As filed with the Securities and Exchange Commission on
February 29, 1996
Registration No. 2-75503
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
(X)
Pre-Effective Amendment No.
(
)
Post-Effective Amendment No. 43
(X)
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940
Amendment No. 43
(X)
MAXIM SERIES FUND, INC.
(Exact Name of Registrant as Specified in Charter)
8515 E. Orchard Road
Englewood, Colorado 80111
Registrant's Telephone Number, including Area Code: (303)
689-3000
W. T. McCallum
President and Chief Executive Officer
Great-West Life & Annuity Insurance Company
8515 E. Orchard Road
Englewood, Colorado 80111
(Name and Address of Agent for Service)
Copies of Communications to:
James F. Jorden, Esquire
Jorden Burt Berenson & Johnson, LLP
1025 Thomas Jefferson St. N. W.
Suite 400 East
Washington, D. C. 20007-0805
It is proposed that this filing will become effective
(check appropriate box)
immediately upon filing pursuant to paragraph
(b) of Rule 485
X on February 29, 1996 pursuant to paragraph (b)
of Rule 485
60 days after filing pursuant to paragraph
(a)(1) of Rule 485
on pursuant to paragraph (a)(1) of
Rule 485
75 days after filing pursuant to paragraph
(a)(2) of Rule 485
on pursuant to paragraph (a)(2) of
Rule 485.
If appropriate, check the
following:
this post-effective amendment designates a new
effective date for
a previously filed post-effective amendment
The Registrant has previously filed a declaration of
indefinite registration of its shares pursuant to Rule 24f-2
under the Investment Company Act of 1940. The Rule 24F-2
Notice for Registrant's fiscal year was filed December 29,
1995. <PAGE>
MAXIM SERIES FUND, INC.
REGISTRATION STATEMENT ON FORM N-1A
CROSS-REFERENCE SHEET
PART A
Form N-1A Item
Prospectus Caption
1. Cover Page
Cover Page
2. Synopsis
Not
Applicable
3. Condensed Financial
Information
Financial Highlights
4. General Description
of Registrant
Introduction; Fund
Portfolios; The Fund and Its
Shares
5. Management of the Fund
Management of the Fund
6. Capital Stock and
Other Securities
The Fund and Its Shares
7. Purchase of Securities
Being Offered
Introduction; Purchase and
Redemption of Shares;
Valuation of Shares
8. Redemption or Repurchase
Purchase and Redemption of
Shares
9. Pending Legal Proceedings
Not
Applicable
PART B
Statement of Additional
Form N-1A Item
Information Caption
10. Cover Page
Cover Page
11. Table of Contents
Table of Contents
12. General Information
and History
Not Applicable
13. Investment Objectives
and Policies
The Fund Portfolios
14. Management of the
Registrant
Management of the Fund
15. Control Persons
and Principal
Purchase and Redemption of
Holders of Securities
Shares
16. Investment Advisory and
Other Services
Management of Fund
17. Brokerage Allocation
Portfolio Transactions and
Brokerage
18. Capital Stock and
Other Securities
Not Applicable
19. Purchase, Redemption
and Price of
Purchase and Redemption of
Securities Being Offered
Shares
20. Tax Status
Taxes
21. Underwriters
Not Applicable
22. Calculation of Yield
Quotations
Calculation of Yields
of Performance Data
and Total Return
23. Financial Statements
Financial Statements
PART C
Form N-1A Item
Part C Caption
24. Financial Statements
and Exhibits
Financial Statements and
Exhibits
25. Persons Controlled
by or Under Common Control
Persons Controlled by
or Under Common Control
26. Number of Holders of
Number of Holders of
Securities
Securities
27. Indemnification
Indemnification
28. Business and Other
Business and Other
Connections
Connections
of Investment Adviser
of
Investment Adviser
29. Principal Underwriters
Principal Underwriters
30. Location of Accounts
Location of Accounts
and Records
and
Records
31. Management Services
Management Services
32. Undertakings
Undertakings
33. Signatures
Signatures<PAGE>
MAXIM SERIES FUND, INC.
8515 E. Orchard Rd., Englewood, Colorado 80111
Phone No. (303) 689-3000
Maxim Series Fund, Inc. (the Fund), an open-end
management investment company, includes the following non-
diversified investment portfolio: the Maxim Vista Growth &
Income Portfolio (the "Vista Portfolio").
The investment objective of the Vista Portfolio is to seek
long-term capital appreciation and to provide dividend income
primarily through a broad portfolio (i.e., at least 80% of
its assets under normal circumstances) of common stock. The
Vista Portfolio seeks to achieve its objective by investing
all of its investible assets in the Growth & Income Portfolio
("Growth & Income"), a non-diversified open-end management
investment company. Growth & Income seeks to achieve its
investment objective, which is identical to the investment
objective of the Vista Portfolio, by investing its assets in
a portfolio of stocks of issuers (including foreign issuers)
ranging from small to medium to large capitalizations.
This Prospectus sets forth concisely the information about
the Vista Portfolio that prospective investors ought to know
before investing.
Additional information about the Fund has been filed with
the Securities and Exchange Commission and is available upon
request, without charge by calling or writing the Fund. The
Statement of Additional Information bears the same date as
this Prospectus and is incorporated by reference into this
Prospectus in its entirety.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS SHOULD BE READ
AND RETAINED FOR FUTURE REFERENCE.
THE GREAT-WEST LIFE ASSURANCE COMPANY
Investment Adviser
The date of this Prospectus is February 29, 1996.
<PAGE>
FINANCIAL HIGHLIGHTS
Selected Data for a Share of Capital Stock For the Period
December 21, 1994 (Inception) to October 31, 1995
MAXIM VISTA GROWTH & INCOME PORTFOLIO1
Period Ended October 31, 1995
Net Asset Value, Beginning of Period
$1.0000
Income From Investment Operations
Net Investment Income
0.0174
Net Gains or Losses on Securities
(realized or unrealized)
0.2133
Total Income From Investment Operations
0.2307
Less Distributions
Dividends (from net investment income)
(0.0174)
Total Distributions
(0.0174)
Net Asset Value, End of Period
$1.2133
Total Return 2/3
27.30%
Net Assets, End of Period
$49,403,163
Ratio of Expenses to Average Net Assets3
1.01%
Ratio of Net Investment Income
to Average Net Assets3
2.21%
Portfolio Turnover Rate4
0.00
1. The portfolio commenced operations on December 21, 1994.
2. The performance shown does not reflect fees or expenses
deducted at the separate account level.
3. Annualized.
4. All purchases and sales were of another Investment
Company. <PAGE>
INTRODUCTION
Maxim Series Fund, Inc. (the Fund) is an open-end
management investment company (a mutual fund) that sells its
shares to the Maxim Series Account, FutureFunds Series
Account, FutureFunds II Series Account, Retirement Plan
Series Account and Pinnacle Series Account of Great-West Life
& Annuity Insurance Company (GWL&A) and to the TNE Series
(k) Account (collectively "Series Accounts") of The New
England Mutual Life Insurance Company ("TNE"). The shares in
the Series Accounts are currently used to fund benefits under
certain individual and group variable annuity contracts and
variable life insurance policies (the Variable Contracts)
issued by GWL&A and TNE. For information concerning your
rights under a variable contract, see the applicable Series
Account prospectus. Shares of the Fund are, and may in the
future be, used to fund benefits under other contracts issued
by GWL&A or its affiliates, TNE or its affiliates, and other
insurance companies. The Great-West Life Assurance Company
(Great-West) is the Investment Adviser for the Fund and the
Vista Portfolio. The investment adviser of Growth & Income
is The Chase Manhattan Bank, N.A. ("Chase"), One Chase
Manhattan Plaza, New York, New York 10081.
THE FUND PORTFOLIOS
The Vista Portfolio has its own investment objective and
investment strategy. The investment objective may not be
changed without a vote of a majority of the shares of the
Vista Portfolio. A more detailed description of the Vista
Portfolio's investment policies and a glossary further
describing certain investment securities mentioned in the
discussion that follows are contained in the Statement of
Additional Information. Unlike other portfolios of the Fund
which directly acquire and manage their own portfolio of
securities, the Vista Portfolio will seek to achieve its
objectives by investing all of its investible assets in
Growth & Income. The Vista Portfolio has an investment
objective that is identical to the investment objective of
Growth & Income. The various investments of and techniques
employed by Growth & Income are discussed under "Maxim Vista
Growth & Income Portfolio", below.
Smaller funds investing in Growth & Income may be
materially affected by the actions of larger funds invested
in Growth & Income. For example, if a large fund withdraws
from Growth & Income, the remaining funds may experience
higher pro rata operating expenses, thereby producing lower
returns, or Growth & Income may become less diverse,
resulting in increased portfolio risk. (However, this
possibility also exists for traditionally structured funds
which have large and/or institutional investors.) Also,
funds with a greater pro rata ownership in Growth & Income
could have effective voting control of the operations of
Growth & Income. Whenever the Fund is requested to vote on
matters pertaining to Growth & Income, the Fund will hold a
meeting of shareholders of the Vista Portfolio and will cast
all of its votes in the same proportion as do the Vista
Portfolio's shareholders. See "The Fund And Its Shares" in
this prospectus for additional information regarding
shareholders of the Fund.
The Vista Portfolio may withdraw its investment in Growth
& Income at any time without shareholder approval if the
Board of Directors of the Fund decides it is in the best
interest of the Vista Portfolio to do so. Upon any such
withdrawal, the Board will consider what action may be taken,
including the investment of assets of the Vista Portfolio in
another underlying mutual fund having the same investment
objective as the Vista Portfolio or the retention of an
investment adviser to manage the Vista Portfolio's assets in
accordance with the investment objective. The investment
objective of the Vista Portfolio, however, and the investment
objective of Growth & Income, can only be changed with
shareholder approval. There is no assurance that the Vista
Portfolio's investment objective will be achieved nor is
there any assurance that Growth & Income's investment
objective will be achieved.
Certain changes in Growth & Income's fundamental
objectives, policies and restrictions could require the Vista
Portfolio to redeem its interest. Any such redemption could
result in a distribution in kind of securities (as opposed to
cash distribution) by the underlying mutual fund. Should
such a distribution occur, the Vista Portfolio could incur
brokerage fees or other transaction costs in converting such
securities to cash. In addition, a distribution in kind
could result in a less diversified portfolio of investments
for the Vista Portfolio and could affect adversely the
liquidity of the Vista Portfolio.
Following is a description of the Vista Portfolio that will
be managed on the basis described above.
Maxim Vista Growth & Income Portfolio
The investment objective of the Vista Portfolio is to seek
long-term capital appreciation and to provide dividend income
primarily through a broad portfolio (i.e., at least 80% of
its assets under normal circumstances) of common stock. The
Vista Portfolio seeks to achieve its objective by investing
all of its investible assets in the Growth & Income, a non-
diversified open-end management investment company managed by
Chase. Growth & Income seeks to achieve its investment
objective, which is identical to the investment objective of
the Vista Portfolio, by investing its assets in a portfolio
of stocks of issuers (including foreign issuers) ranging from
small to medium to large capitalizations. Foreign
investments can involve risk, however, that may not be
present in domestic securities. Please see "Foreign
Investment Risks" in this prospectus.
For the most part, Growth & Income will pursue a "contrary
opinion" investment approach, selecting common stocks that
are currently out of favor with investors in the stock
market. These securities are usually characterized by a
relatively low price/earnings ratio (using normalized
earnings), a low ratio of market price to book value, or
underlying asset values that are believed to be not fully
reflected in the current market price. It is believed that
the market risk involved in this policy will be moderated
somewhat by the anticipated dividend returns on the stocks to
be held by Growth & Income.
Growth & Income normally will be fully invested and will,
in normal circumstances, invest at least 80% of its assets in
common stocks. However, Growth & Income reserves the right
to invest up to 100% of its assets in cash, cash equivalents
and debt securities for temporary defensive purposes during
periods that it is considered to be particularly risky for
investment in common stocks.
Growth & Income may enter into stock index futures
contracts, options on stock index futures contracts, options
on stock indexes and options on equity securities, for the
purpose of hedging its portfolio. These investment practices
involve certain special risks. Please see the Statement of
Additional Information concerning more detailed information
about these practices.
To the extent the assets of Growth & Income are not
invested in common stocks, they will consist of or be
invested in cash, cash equivalents and short-term debt
securities, such as U.S. Government securities, bank
obligations, commercial paper and repurchase agreements.
Foreign Investment Risks
Investments in foreign securities present risks not
typically associated with investments in comparable
securities of U.S. issuers.
There may be less information publicly available about a
foreign corporate or government issuer than about a U.S.
issuer, and foreign corporate issuers are not generally
subject to accounting, auditing and financial reporting
standards and practices comparable to those in the United
States. The securities of some foreign issuers are less
liquid and at times more volatile than securities of
comparable U.S. issuers. Foreign brokerage commissions and
securities custody costs are often higher than those in the
United States, and judgments against foreign entities may be
more difficult to obtain and enforce. With respect to
certain foreign countries, there is a possibility of
governmental expropriation of assets, confiscatory taxation,
political or financial instability and diplomatic
developments that could affect the value of investments in
those countries. The receipt of interest on foreign
government securities may depend on the availability of tax
or other revenues to satisfy the issuer's obligations.
Growth & Income's investments in foreign securities may
include investments in countries whose economies or
securities markets are not yet highly developed. Special
considerations associated with these investments (in addition
to the considerations regarding foreign investments
generally) may include, among others, greater political
uncertainties, an economy's dependence on revenues from
particular commodities or on international aid or development
assistance, currency transfer restrictions, highly limited
numbers of potential buyers for such securities and delays
and disruptions in securities settlement procedures.
Most foreign securities held by Growth & Income will be
denominated in foreign currencies or traded in securities
markets in which settlements are made in foreign currencies.
Similarly, any income on such securities is generally paid to
Growth & Income in foreign currencies. The value of these
foreign currencies relative to the U.S. dollar varies
continually, causing changes in the dollar value of a Growth
& Income's investments (even if the price of the investments
is unchanged) and changes in the dollar value of a Growth &
Income's income available for distribution to its
shareholders. The effect of changes in the dollar value of
a foreign currency on the dollar value of a Growth & Income's
assets and on the net investment income available for
distribution may be favorable or unfavorable.
Growth & Income may incur costs in connection with
conversions between various currencies. In addition, Growth
& Income may be required to liquidate portfolio assets, or
may incur increased currency conversion costs, to compensate
for a decline in the dollar value of a foreign currency
occurring between the time when Growth & Income declares and
pays a dividend, or between the time when Growth & Income
accrues and pays an operating expense in U.S. dollars.
Foreign Currency Exchange Transactions
Growth & Income may engage in foreign currency exchange
transactions to protect against uncertainty in the level of
future exchange rates. For example, Growth & Income may
engage in foreign currency exchange transactions in
connection with the purchase and sale of securities
("transaction hedging") and to protect against changes in the
value of specific positions ("position hedging").
Growth & Income may engage in transaction hedging to
protect against a change in foreign currency exchange rates
between the date on which Growth & Income contracts to
purchase or sell a security and the settlement date, or to
"lock in" the U.S. dollar equivalent of a dividend or
interest payment in a foreign currency. A portfolio may
purchase or sell a foreign currency on a spot (or cash) basis
at the prevailing spot rate in connection with the settlement
of transactions in securities denominated in that foreign
currency.
If conditions warrant, Growth & Income may also enter into
contracts to purchase or sell foreign currencies at a future
date ("forward contracts") and purchase and sell foreign
currency futures contracts as a hedge against changes in
foreign currency exchange rates between the trade and
settlement dates on particular transactions and not for
speculation. A foreign currency forward contract is a
negotiated agreement to exchange currency at a future time at
a rate or rates that may be higher or lower than the spot
rate. Foreign currency futures contracts are standardized
exchange-traded contracts and have margin requirements.
For transaction hedging purposes Growth & Income may also
purchase or sell exchange-listed and over-the-counter call
and put options on foreign currency futures contracts and on
foreign currencies.
Growth & Income may engage in position hedging to protect
against the decline in the value relative to the U.S. dollar
of the currencies in which its portfolio securities are
denominated or quoted (or an increase in the value of the
currency in which the securities Growth & Income intends to
buy are denominated, when Growth & Income holds cash or
short-term investments). For position hedging purposes,
Growth & Income may purchase or sell foreign currency futures
contracts, foreign currency forward contracts and options on
foreign currency futures contracts and on foreign currencies
on exchanges or over-the-counter markets. In connection with
position hedging, Growth & Income may also purchase or sell
foreign currency on a spot basis.
Growth & Income's currency hedging transactions may call
for the delivery of one foreign currency in exchange for
another foreign currency and may at times not involve
currencies in which its portfolio securities are then
denominated. "Cross hedging" activities may be engaged in
when it is believed that such transactions provide
significant hedging opportunities. Cross hedging
transactions involve the risk of imperfect correlation
between changes in the values of the currencies to which such
transactions relate and changes in the value of the currency
or other asset or liability which is the subject of the
hedge.
Hedging transactions involve costs and may result in
losses. Growth & Income will engage in over-the-counter
transactions only when appropriate exchange-traded
transactions are unavailable and when it is believed the
pricing mechanism and liquidity are satisfactory and the
participants are responsible parties likely to meet their
contractual obligations. There is no assurance that
appropriate foreign currency exchange transactions will be
available with respect to all currencies in which investments
may be dominated.
Hedging transactions may also be limited by tax
considerations. Hedging transactions may affect the
character or amount of distributions.
Growth & Income may invest in other types of certain
futures contracts and options which entail certain risks.
Please see the Statement of Additional Information for a
complete discussion of these investment techniques and risks
associated therewith.
MANAGEMENT OF THE FUND AND GROWTH & INCOME
Overall responsibility for management and supervision of
the Fund rests with the Fund's Directors and overall
responsibility for management and supervision of Growth &
Income rests with Trustees of Growth & Income. The Fund
currently has five Directors, three of whom are not
interested persons of the Fund within the meaning of that
term under the Investment Company Act of 1940. The Board of
Directors of the Fund meets regularly four times each year
and at other times as necessary. By virtue of the functions
performed by Great-West as Investment Adviser to the Fund and
The Chase Manhattan Bank, N.A. ("Chase") as investment
adviser to Growth & Income, the Fund requires no employees
other than its executive officers, none of whom devotes full
time to the affairs of the Fund. These officers are
employees of Great-West and receive compensation from it.
The Statement of Additional Information contains the names
of, and general background information regarding, each
Director and executive officer of the Fund and each Trustee
and executive officer of Growth & Income.
Investment Adviser of the Fund
Great-West, located at 8515 E. Orchard Rd., Englewood,
Colorado 80111, serves as the Fund's investment adviser.
Through Power Corporation of Canada, a holding and management
company, Great-West is controlled by a Canadian investor,
Paul Desmarais, and his associates. Great-West presently
acts as the investment adviser for Great-West Variable
Annuity Account A, a separate account of GWL&A registered as
a management investment company, and certain non-registered,
qualified corporate pension plan separate accounts of GWL&A.
Great-West is a registered investment adviser with the
Securities and Exchange Commission.
Subject to the supervision and direction of the Fund's
Board of Directors, Great-West generally manages the Fund's
portfolios in accordance with the Fund's stated investment
objectives and policies, makes investment decisions for the
Fund and places orders to buy and sell securities on behalf
of the Fund. The investment adviser to Growth & Income, in
which the Vista Portfolio invests all its assets, manages
Growth & Income in accordance with Growth & Income's stated
investment objectives and policies, making investment
decisions for Growth & Income and placing orders to buy and
sell securities on behalf of Growth & Income. Great-West
will be responsible for accounting and administration of the
Vista Portfolio only.
With respect to the Vista Portfolio, Great-West
shall
be responsible for all expenses, except extraordinary
expenses. Great-West performs certain accounting and
administrative services for the Vista Portfolio and will
receive monthly compensation at the annual rate of 0.53% for
its services provided with respect to the Vista
Portfolio.
Investment Adviser of Growth & Income
Chase manages the assets of Growth & Income pursuant to an
investment advisory agreement dated November 15, 1993. The
day-to-day co-managers for Growth and Income are Dave Klassen
and Greg Adams, Vice Presidents of Chase. Mr. Klassen, Head
of U.S. Equity Funds Management and Research for Chase, is
also primarily responsible for the day-to-day management of
the Capital Growth Portfolio for which Chase is investment
adviser, as well as several pooled equity funds. Mr. Klassen
joined Chase in March of 1992. Prior to that he spent 11
years at Dean Witter Reynolds as Vice President and Portfolio
Manager, responsible for a number of mutual funds and
individual accounts.
Mr. Adams, Director of U.S. Equity Research for Chase, is
also responsible for managing the Vista Equity Fund, the
Vista Equity Income Fund and co-manages the Vista Balanced
Fund all of which are managed by Chase, as well as a number
of Chase's pooled equity funds. Mr. Adams joined Chase in
1987 and has been responsible for overseeing the proprietary
computer model program used in the U.S. equity selection
process.
For its investment advisory services, Chase will receive an
annual fee computed daily and paid monthly at an rate equal
to .40% of Growth & Income's average daily net assets. Chase
may, from time to time, voluntarily waive all or a portion of
its fees payable under the Advisory Agreement.
Chase, a wholly owned subsidiary of The Chase Manhattan
Corporation, a registered bank holding company, is a
commercial bank offering a wide range of banking and
investment services to customers throughout the United States
and around the world. Its headquarters are at One Chase
Manhattan Plaza, New York, New York 10081. Chase is one of
the largest commercial banks in the United States and The
Chase Manhattan Corporation is one of the largest bank
holding companies in the United States. The Chase Manhattan
Corporation through various subsidiaries provides personal,
corporate and institutional investment management services.
Chase, including its predecessor organizations, has over 100
years of money management experience and renders investment
advisory services to others. Also included among Chase's
accounts are commingled trust funds and a broad spectrum of
individual trust and investment management portfolios. These
accounts have varying investment objectives.
On August 27, 1995, The Chase Manhattan Corporation
announced its entry into an Agreement and Plan of Merger (the
"Merger Agreement") with Chemical Banking Corporation
("Chemical"), a bank holding company, pursuant to which The
Chase Manhattan Corporation will merge with and into Chemical
(the "Holding Company Merger"). Under the terms of the
Merger Agreement, Chemical will be the surviving corporation
in the Holding Company Merger, which will create the second
largest bank holding company in the United States based on
assets. The consummation of the Holding Company Merger is
subject to certain closing conditions. On December 11, 1995,
the respective shareholders of The Chase Manhattan
Corporation and Chemical voted to approve the Holding Company
Merger. The Holding Company Merger is expected to be
completed on or about March 31, 1996.
Subsequent to the Holding Company Merger, it is
expected that the adviser to Growth & Income, The Chase
Manhattan Bank, N.A., will be merged with and into Chemical
Bank, a New York State chartered bank ("Chemical Bank")(the
"Bank Merger" and together with the Holding Company Merger,
the "Mergers"). The surviving bank will continue operations
under the name The Chase Manhattan Bank (as used herein, the
term "Chase" refers to The Chase Manhattan Bank, N.A. and its
successor in the Bank Merger, and the term "Adviser" means
Chase (including its successor in the Bank Merger) in its
capacity as investment adviser to Growth & Income). The
consummation of the Bank Merger is subject to certain closing
conditions, including the receipt of certain regulatory
approvals. The Bank Merger is expected to occur in July
1996.
Chemical is a publicly owned bank holding company
incorporated under Delaware law and registered under the
Federal Bank Holding Company Act of 1956, as amended. As of
December 31, 1995, through its direct or indirect
subsidiaries, Chemical managed more than $57 billion in
assets, including approximately $6.9 billion in mutual fund
assets in 11 mutual fund portfolios. Chemical Bank is a
wholly owned subsidiary of Chemical and is a New York State
chartered bank.
Chase and its affiliates may have deposit, loan and other
commercial banking relationships with the issuers of
securities purchased on behalf of Growth & Income, including
outstanding loans to issuers which may be repaid in whole or
in part with the proceeds of securities so purchased. Chase
and its affiliates deal, trade and invest for their own
accounts in U.S. Government obligations, municipal
obligations and commercial paper and are among the leading
dealers of various types of U.S. Government obligations and
municipal obligations. Chase will not invest Growth &
Income's assets in any U.S. Government obligation, municipal
obligations or commercial paper purchased from itself or any
affiliate, although under certain circumstances such
securities may be purchased from other members of an
underwriting syndicate in which Chase or an affiliate is a
non-principal member. This restriction may limit the amount
or type of U.S. Government obligations, municipal obligations
or commercial paper available to be purchased by Growth &
Income. Chase has informed Growth & Income that in making
its investment decisions, it does not obtain or use material
inside information in the possession of any other division or
department of Chase, including the division that performs
services for Growth & Income as custodian, or in the
possession of any affiliate of Chase.
Chase has been advised by its legal counsel that it may
provide the services described above, without violating the
federal banking law commonly known as the Glass-Steagall Act
("Act"). The Act generally bars banks from publicly
underwriting or distributing certain securities.
The U.S. Supreme Court in its 1981 decision in Board of
Governors of the Federal Reserve System v. Investment Company
Institute determined that, consistent with the requirements
of the Act, a bank may serve as an investment adviser to a
registered, closed-end investment company. Other decisions
of banking regulators have supported the position that a bank
may act as investment adviser to a registered, open-end
investment company. Based on the advice of its counsel,
Chase believes that the Court's decision, and these other
decisions of banking regulators, permit it to serve as
investment adviser to a registered, open-end investment
company.
Possible future changes in federal law or administrative or
judicial interpretations of current or future law, however,
could prevent Chase from continuing to perform investment
advisory services for Growth & Income. If that occurs,
Growth & Income's Board of Trustees promptly would seek to
obtain for Growth & Income the services of another qualified
adviser. Although no assurances can be given, Growth &
Income believes that, if necessary, the transfer to a new
adviser could be accomplished without undue disruption to
operations.
Chase also serves as administrator to Growth &
Income
and is entitled to a fee computed daily and paid monthly at
an annual rate equal to 0.05% of Growth & Income's average
daily net assets. Chase may, from time to time, voluntarily
waive all or a portion of its administrative fees.
Additionally, expenses attributable to and payable by the
Growth & Income Portfolio, currently at the annual rate of
0.02% of Growth & Income's average daily net assets, are paid
monthly. Expenses include, but are not limited to, expenses
connected with the execution, recording and settlement of
security transactions; fees and expenses of Growth & Income's
custodian for all services to Growth & Income, including
safekeeping of funds and securities and maintaining required
books and accounts; expenses of preparing and mailing reports
to investors and to government officers and commissions; and
expenses of meetings of investors.
<PAGE>
DIVIDENDS, DISTRIBUTIONS AND TAXES
Dividends from the investment income of the Vista
Portfolio shall be declared and reinvested quarterly in
additional shares of Growth & Income at net asset value.
Distributions of net realized capital gains, if any, are
declared in the fiscal year in which they have been realized
and are reinvested in additional shares of Growth & Income at
net asset value.
The Fund has qualified, and intends to continue to qualify,
as a registered investment company under Subchapter M of the
Internal Revenue Code (Code). Each Portfolio of the Fund
will be treated as a separate corporation for federal income
tax purposes. The Fund intends to distribute all of its net
income so as to avoid any Fund-level tax. Therefore,
dividends derived from interest and distributions of any
realized capital gains will be taxable, under Subchapter M,
to the Fund's shareholders, which in this case are GWL&A's
Series Accounts. The Fund also intends to distribute
sufficient income to avoid the imposition of the Code Section
4982 excise tax.
For a discussion of the taxation of GWL&A or TNE and the
Series Accounts, see Federal Tax Considerations included in
the applicable Series Account prospectus.
PURCHASE AND REDEMPTION OF SHARES
Shares of the Fund (i.e., its Portfolios) are sold and
redeemed at their net asset value next determined after
initial receipt of purchase order or notice of redemption
without the imposition of any sales commission or redemption
charge. However, certain deferred sales and other charges
may apply to the variable contracts. Such charges are
described in the applicable Series Account prospectus.
VALUATION OF SHARES
A portfolio's net asset value per share is determined as of
4:00 p.m., EST/EDT time once, daily, Monday through Friday,
except on: (i) holidays on which the New York Stock Exchange
is closed, or (ii) on days on which Growth & Income is not
valued.
Since the Vista Portfolio will invest all its investible
assets in Growth & Income, the value of the Vista Portfolio's
shares will be equal to the value of its beneficial interests
in Growth & Income. If the securities owned by Growth &
Income increase in value, the value of the Vista Portfolio's
shares will increase. If the securities owned by Growth &
Income decrease in value, the value of the Vista Portfolio's
shares will also decline. In this way, investors participate
in any change in the value of the securities owned by Growth
& Income.
THE FUND AND ITS SHARES
The Fund was incorporated under the laws of the State of
Maryland on December 7, 1981 and is registered with the
Securities and Exchange Commission as a diversified,
open-end, management investment company. The Fund commenced
operations on February 25, 1982.
The Fund offers a separate class of common stock for each
portfolio. All shares will have equal voting rights, except
that only shares of a respective portfolio will be entitled
to vote on matters concerning only that portfolio. Each
issued and outstanding share of a portfolio is entitled to
one vote and to participate equally in dividends and
distributions declared by that portfolio and, upon
liquidation or dissolution, to participate equally in the net
assets of such portfolio remaining after satisfaction of
outstanding liabilities. The shares of each portfolio, when
issued, will be fully paid and non-assessable, have no
preference, preemptive, conversion, exchange or similar
rights, and will be freely transferable. Shares do not have
cumulative voting rights and the holders of more than 50% of
the shares of the Fund voting for the election of Directors
can elect all of the Directors of the Fund if they choose to
do so and, in such event, holders of the remaining shares
would not be able to elect any Directors.
The Series Accounts, as part of GWL&A or TNE, and
Great-West, which provided the Fund's initial capitalization,
and the affiliates of Great-West or TNE, will be holders of
the shares and be entitled to exercise the rights directly as
described in the applicable Series Account prospectus.
Whenever the Fund is requested to vote on matters pertaining
to Growth & Income, the Fund will hold a meeting of
shareholders of the Vista Portfolio and will cast all of its
votes in the same proportion as do the Vista Portfolio's
shareholders.
The Fund offers its shares to the Series Accounts. For
various reasons, it may become disadvantageous for one or
more of the Series Accounts to continue to invest in Fund
shares. In such an event, one or more Series Accounts may
redeem its Fund shares. For further information, see the
Statement of Additional Information.
<PAGE>
PERFORMANCE RELATED INFORMATION
The Fund may advertise certain performance related
information. Performance information about the Fund is based
on the Vista Portfolio's and/or Growth & Income's past
performance only and is no indication of future performance.
The Fund may include total return in advertisements or
other sales materials regarding the Vista Portfolio. When
the Fund advertises the total return of one its portfolios,
it will usually be calculated for one year, five years, and
ten years or some other relevant period if the Vista
Portfolio and Growth & Income have not been in existence for
at least ten years. Total return is measured by comparing
the value of an investment in the portfolio at the beginning
of the relevant period to the value of the investment at the
end of the period (assuming immediate reinvestment of any
dividends or capital gains distributions). The performance
of the Vista Portfolio will be affected by charges and fees
at the separate account level.
The Vista Portfolio may also advertise its yield in
addition to total return. This yield will be computed by
dividing the net investment income per share earned during a
recent one-month period by the net asset value of a Vista
Portfolio share (reduced by any dividend expected to be paid
shortly out of Vista Portfolio income) on the last day of the
period.
GENERAL INFORMATION
Reports to Shareholders
The fiscal year of the Vista Portfolio and Growth & Income
ends on October 31 of each year. The Fund will send to its
shareholders, at least semi-annually, reports of the Vista
Portfolio and other information. An annual report,
containing financial statements, audited by independent
certified public accountants, will be sent to shareholders
each year.
Custodian for the Fund and Growth & Income
Morgan Guaranty Trust Company of New York ("Morgan"), New
York City, New York, acts as custodian of the Fund's assets.
Morgan has custody of the Fund's assets held within and
outside the United States. Morgan holds the Fund's assets in
safekeeping and collects and remits the income thereon
subject to the instructions of the Fund.
The custodian of Growth & Income's assets is Chase, whose
duties include safeguarding and controlling Growth & Income's
cash and securities and other related functions.
Independent Auditors for the Fund and Growth & Income
Deloitte & Touche LLP has been selected as the independent
auditors of the Fund. The selection of independent auditors
is subject to annual ratification by the Fund's shareholders.
Price Waterhouse LLP has been selected as the independent
auditors of Growth & Income.
Legal Counsel for the Fund
Jorden Burt Berenson & Johnson, LLP is counsel
for the
Fund.
Additional Information
The telephone number or the address of the Fund appearing
on the front page of this prospectus should be used for
requests for additional information.<PAGE>
MAXIM SERIES FUND, INC.
Vista Portfolio
STATEMENT OF ADDITIONAL INFORMATION
This Statement of Additional Information is
not a prospectus but supplements and should be
read in conjunction with the Prospectus for
the Fund. A copy of the Prospectus may be
obtained from the Fund by writing the Fund at
8515 E. Orchard Rd., Englewood, Colorado 80111
or by calling the Fund at (303) 689-3000.
THE GREAT-WEST LIFE ASSURANCE
COMPANY
Investment Adviser
The date of the Prospectus to which this Statement
of Additional Information relates and the date of
this Statement of Additional Information is
February 29, 1996.
<PAGE>
TABLE OF CONTENTS
Page
Sale of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 3
The Fund Portfolios. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 3
Description of Investment Securities . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 3
Information About Securities Ratings . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.11
Investment Limitations . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.13
Lending of Portfolio Securities. . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. .14
Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.15
The Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15
Directors and Officers . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.15
The Investment Adviser . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Advisory Fee . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. .16
The Growth & Income Portfolio. . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Trustees and Officers. . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. .16
The Investment Adviser of Growth & Income. . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.17
The Growth & Income Administrator
19
Purchase and Redemption of Shares
19
Calculation of Yield . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Calculation of Total Return . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
21
Price Make-Up Sheet. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.23
<PAGE>
SALE OF SHARES
Shares of the Fund are sold to the FutureFunds Series
Account, FutureFunds II Series Account, Qualified Series
Account and Maxim Series Account, which are separate accounts
established by GWL&A to receive and invest premiums paid
under variable annuity contracts issued by GWL&A. Shares of
the Fund are also sold to TNE Series (K) Account of New
England Mutual Life Insurance Company ("TNE") to fund
benefits under variable annuity contracts. Shares of the
Fund are also sold to the Pinnacle Series Account, a separate
account established by GWL&A to fund variable life insurance
policies. Shares of the Fund are, and in the future may be,
sold to other separate accounts of GWL&A, its affiliates or
other insurance companies. It is conceivable that in the
future it may be disadvantageous for variable life insurance
separate accounts and variable annuity separate accounts to
invest in the Fund simultaneously. Although no such
disadvantages are currently foreseen either to variable life
insurance policyowners or to variable annuity contract
owners, the Fund's Board of Directors intends to monitor
events in order to identify any material conflicts between
such policyowners and contract owners and to determine what
action, if any, should be taken in response thereto.
Material conflicts could result from, for example, (1)
changes in state insurance laws, (2) changes in Federal
income tax laws, (3) changes in the investment management of
any portfolio of the Fund, or (4) differences in voting
instructions between those given by policyowners and those
given by contract owners.
THE FUND PORTFOLIOS
The discussion that follows provides supplemental
information to the discussion captioned "The Fund Portfolios"
in the Prospectus.
The Fund commenced operations as a management investment
company in 1982. The Maxim Vista Growth and Income Portfolio
(the "Vista Portfolio") was added effective December 21,
1994.
Description of Investment Securities
1. Asset-Backed Securities. Asset-backed securities
may
be classified as pass-through certificates of
collateralized obligations. They depend
primarily on
the credit quality of the assets underlying such
securities, how well the entity issuing the security
is insulated from the credit risk of the
originator or
any other affiliated entities and the amount and
quality of any credit support provided to the
securities. The rate of principal payment on asset-
backed securities generally depends on the rate of
principal payments received on the underlying assets
which in turn may be affected by a variety of
economic
and other factors. As a result, the yield on any
asset-backed security is difficult to predict with
precision and actual yield to maturity may be
more or
less than the anticipated yield to maturity.
Pass-through certificates are asset-backed
securities
which represent an undivided fractional ownership
interest in any underlying pool of assets. Pass-
through certificates usually provide for payments of
principal and interest received to be passed through
to their holders, usually after deduction for
certain
costs and expenses incurred in administering the
pool.
Because pass-through certificates represent an
ownership interest in the underlying assets, the
holders thereof bear directly the risk of any
defaults
by the obligors on the underlying assets not covered
by any credit support.
Asset-backed securities issued in the form of debt
instruments, also known as collateralized
obligations,
are generally issued as the debt of a special
purpose
entity organized solely for the purposes of owning
such assets and issuing such debt. Such assets are
most often trade, credit card or automobile
receivables. The assets collateralizing the debt
instrument are pledged to a trustee or custodian for
the benefit of the holders thereof. Such issuers
generally hold no assets other than those underlying
the security and any credit support provided. As a
result, although payments on such securities are
obligations of the issuers, in the event of a
default
on the underlying assets not covered by credit
support, the issuing entities are unlikely to have
sufficient assets to satisfy their obligations on
the
related asset-backed securities.
2. Bankers' Acceptance. A bankers' acceptance is a t
ime
draft drawn on a commercial bank by a borrower,
usually in connection with international commercial
transactions (to finance the import, export,
transfer
or storage of goods). The borrower is liable for
payment as well as the bank, which unconditionally
guarantees to pay the draft at its face amount on
the
maturity date. Most acceptances have maturities of
six months or less and are traded in secondary
markets
prior to maturity. The Fund generally will not
invest in acceptances with maturities exceeding 7
days
where to do so would tend to create liquidity
problems.
3. Certificate of Deposit. A certificate of deposit
generally is a short-term, interest bearing
negotiable
certificate issued by a commercial bank or
savings and
loan association against funds deposited in the
issuing institution.
4. Collateralized Mortgage Obligations. A
Collateralized
Mortgage Obligation ("CMO") is a bond which uses
certificates issued by the Government National
Mortgage Association, or the Federal National
Mortgage
Association or the Federal Home Loan Mortgage
Corporation as collateral in trust. The trust then
issues several bonds which will be paid using the
cash
flow from the collateral. The trust can redirect
cash
flow temporarily, first paying one bond before other
bonds are paid. The trust can also redirect
prepayments from one bond to another bond, creating
some stable bonds and some volatile bonds. The
proportion of principal cash flow and interest cash
flow from the collateral flowing to each bond can
also
be changed, creating bonds with higher or lower
coupons to the extreme of passing through the
interest
only to one bond and principal only to another
bond.
Variable rate or floating coupon bonds are also
often
created through the use of CMO's.
5. Commercial Paper. Commercial paper is a short-term
promissory note issued by a corporation primarily to
finance short-term credit needs.
6. Covered Options. There are two types of covered
options. A covered call option gives the purchaser
the right to buy the underlying securities from the
seller at a stated exercise price. In writing a
covered call option, the seller must own the
underlying securities subject to the option (or
comparable securities satisfying the cover
requirements of securities exchanges). A covered
put
option gives the purchaser the right to sell the
underlying securities at a stated price. In the c
ase
of a covered put option, the seller will hold cash
and/or high-grade short-term debt obligations
equal to
the price to be paid if the option is exercised.
The
seller will be considered to have covered a put or
call option if and to the extent that it holds an
option that offsets some or all of the risk of the
option it has written. Combinations of covered puts
and calls may be written on the same underlying
security.
Put options may be purchased to protect its
portfolio
holdings in an underlying security against a decline
in market value. Such protection is provided during
the life of the put option because the holder of the
option is able to sell the underlying security at
the
put exercise price regardless of any decline in the
underlying security's market price. In order for a
put option to be profitable, the market price of the
underlying security must decline sufficiently below
the exercise price to cover the premium and
transaction costs. By using put options in this
manner, the seller will reduce any profit it might
otherwise have realized from appreciation of the
underlying security by the premium paid for the put
option and by transaction costs.
Premiums are received from writing a put or call
option, which increases the return on the underlying
security in the event the option expires unexercised
or is closed out at a profit. The amount of the
premium reflects, among other things, the
relationship
between the exercise price and the current market
value of the underlying security, the volatility of
the underlying security, the amount of time
remaining
until expiration, current interest rates, and the
effect of supply and demand in the options market
and
in the market for the underlying security. By
writing
a call option, the seller limits its opportunity to
profit from any increase in the market value of the
underlying security above the exercise price of the
option but continues to bear the risk of a
decline in
the value of the underlying security. By writing a
put option, the seller assumes the risk that it
may be
required to purchase the underlying security for an
exercises price higher than its then-current market
value, resulting in a potential capital loss unless
the security subsequently appreciates in value.
Call options may be purchased to hedge against an
increase in the price of securities that the
purchaser
wants ultimately to buy. Such hedge protection is
provided during the life of the call option since
the
holder of the call option is able to buy the
underlying security at the exercise price regardless
of any increase in the underlying security's market
price. In order for a call option to be profitable,
the market price of the underlying security must
rise
sufficiently above the exercise price to cover the
premium and transactions costs.
Special risks are presented by internationally-
traded
options. Because of time differences, and because
different holidays are observed in different
countries, foreign options markets may be open for
trading during hours or on days when U.S. markets
are
closed. As a result, option premiums may not
reflect
the current prices of the underlying interest in the
United States.
7. Dealer (Over-the-Counter) Options. A dealer
option is
an option which is not traded on an exchange and may
be exercised through the dealer from whom it had
purchased the option. If a Portfolio were to
purchase
a dealer option, failure by the dealer to perform on
the option would result in the loss of the premium
paid as well as loss of the expected benefit of the
transaction.
Dealer options do not have a continuous liquid m
arket
as do exchange-traded options. Consequently, the
value of a dealer option may be realized only be
exercising it or reselling it to the dealer who
issued
it. Dealer options will only be entered into with
dealers who will agree to and which are expected
to be
capable of entering into closing transactions;
however, there can be no assurance the a dealer
option
may be liquidated at a favorable price at any time
prior to expiration. In the event of an insolvency
of the contra party, a dealer option may not be
liquidated.
The staff of the SEC has taken the position that
purchased dealer options and the assets used to
secure
the written dealer options are illiquid securities.
The cover used for written over-the-counter options
may be treated as liquid if the dealer agrees
that the
over-the-counter option which the dealer has written
may be repurchased for a maximum price to be
calculated by a predetermined formula. In such
cases,
the over-the-counter option would be considered
illiquid only to the extent the maximum repurchase
price under the formula exceeds the intrinsic
value of
the option. Accordingly, dealer options will be
treated as subject to the limitation on illiquid
securities. If the SEC changes its position on the
liquidity of dealer options, the Fund will change
its
treatment of such instrument accordingly.
8. Eurodollar Certificate of Deposit. A Eurodollar
certificate of deposit is a short-term obligation of
a foreign subsidiary of a U.S. bank payable in U.S.
dollars.
9. Floating Rate Note. A floating rate note is debt
issued by a corporation or commercial bank that is
typically several years in term but has a
resetting of
the interest rate on a one to six month rollover
basis.
10. Forward Contracts. A forward contract involves an
obligation to purchase or sell a specific
currency at
a future date, which may be any fixed number of days
from the date of the contract agreed upon by the
parties, at a price set at the time of the
contract.
These contracts may be bought or sold to protect the
seller, to some degree, against a possible loss
resulting from an adverse change in the relationship
between foreign currencies and the U.S. dollar.
Forward contracts can be used to protect the
value of
a seller's investment securities by establishing a
rate of exchange that the seller can achieve at some
future point in time; they do not simulate
fluctuations in the underlying prices of the
securities. Additionally, although forward
contracts
tend to minimize the risk of loss due to a d
ecline in
the value of the hedged currency, at the same time,
they tend to limit any potential gains that might
result should the value of such currency increase.
11. Hybrid Instruments. Hybrid instruments have
recently
been developed and combine the elements of futures
contracts or options with those of debt, preferred
equity or a depository instrument. Often these
hybrid
instruments are indexed to the price of a commodity,
particular currency, or a domestic or foreign
debt or
equity securities index. Hybrid instruments may
take
a variety of forms, including, but not limited to,
debt instruments with interest or principal payments
or redemption terms determined by reference to the
value of a currency or commodity or securities index
at a future point in time, preferred stock with
dividend rates determined by reference to the
value of
a currency, or convertible securities with the
conversion terms related to a particular commodity.
The risks associated with hybrid instruments reflect
a combination of the risks of investing in
securities,
options, futures and currencies, including
volatility
and lack of liquidity. Further, the prices of the
hybrid instrument and the related commodity or
currency may not move in the same direction or at
the
same time.
12. Index Futures Contracts. An index futures contract
obligates the seller to deliver (and the
purchaser to
take) an amount of cash equal to a specific dollar
amount times the difference between the value of a
specific index at the close of the last trading
day of
the contract and the price at which the agreement is
made. No physical delivery of the underlying
security
in the index is made. When purchasing an index
futures contract or selling index futures, (1) a
segregated account consisting of cash, U.S.
Government
securities, or other liquid high-grade debt
securities
must be maintained with the custodian bank (and
marked
to market daily) which, when added to any amounts
deposited with a futures commission merchant as
margin, are equal to the market value of the futures
contract; or (2) the Fund must "cover" its position.
13. Repurchase Agreements. A repurchase agreement is an
instrument under which the purchaser acquires
ownership of a debt security and the seller
agrees to
repurchase the obligation at a mutually agreed upon
time and price. The total amount received on
repurchase is calculated to exceed the price paid by
the purchaser, reflecting an agreed upon market rate
of interest for the period from the time of purchase
of the security to the settlement date (i.e., the
time
of repurchase), and would not necessarily relate to
the interest rate on the underlying securities. A
purchaser will only enter repurchase agreements with
underlying securities consisting of U.S.
Government or
government agency securities, certificates of
deposit,
commercial paper or bankers' acceptances, and
will be
entered only with primary dealers. While investment
in repurchase agreements may be made for periods
up to
30 days, it is expected that typically such periods
will be for a week or less. The staff of the
Securities and Exchange Commission has taken the
position that repurchase agreements of greater
than 7
days should be limited to an amount not in excess of
10% of a purchaser's total assets.
Although repurchase transactions usually do not im
pose
market risks on the purchaser, the purchaser
would be
subject to the risk of loss if the seller fails to
repurchase the securities for any reason and the v
alue
of the securities is less than the agreed upon
repurchase price. In addition, if the seller
defaults, the purchaser may incur disposition
costs in
connection with liquidating the securities.
Moreover,
if the seller is insolvent and bankruptcy
proceedings
are commenced, under current law, the purchaser
could
be ordered by a court not to liquidate the
securities
for an indeterminate period of time and the amount
realized by the purchaser upon liquidation of the
securities may be limited.
14. Reverse Repurchase Agreements. Reverse repurchase
agreements involve the sale of securities held by
the
seller, with an agreement to repurchase the
securities
at an agreed upon price, date and interest payment.
The seller will use the proceeds of the reverse
repurchase agreements to purchase other money market
securities either maturing, or under an agreement to
resell, at a date simultaneous with or prior to the
expiration of the reverse repurchase agreement. The
seller will utilize reverse repurchase agreements
when
the interest income to be earned from the investment
of the proceeds from the transaction is greater than
the interest expense of the reverse repurchase
transaction.
15. Stripped Treasury Securities. Zero-Coupon Treasury
Securities come in two forms: U.S. Treasury bills
issued directly by the U.S. Treasury and U.S.
Treasury
bonds or notes and their unmatured interest coupons
which have been separated by their holder, typically
a custodian bank or investment brokerage firm. A
number of securities firms and banks have
stripped the
interest coupons from Treasury bonds and notes and
resold them in custodial receipt programs with a
number of different names. The underlying Treasury
bonds and notes themselves are held in book-entry
form
at the Federal Reserve Bank or, in the case of
bearer
securities, in trust on behalf of the owners
thereof.
Publicly filed documents state that counsel to the
underwriters of these certificates or other
evidences
of ownership of the U.S. Treasury securities have
stated that for Federal tax and securities purposes,
purchasers of such certificates most likely will be
deemed the beneficial holders of the underlying U.S.
Government securities. In addition, such documents
state that the terms of custody for the custodial
receipt programs generally provide that the
underlying
debt obligations will be held separate from the
general assets of the custodian and will not be
subject to any right, charge, security interest,
lien,
or claim of any kind in favor of the custodian or
any
person claiming through the custodian, and the
custodian will be responsible for applying all
payments received on these underlying debt
obligations, if any, to the related receipts or
certificates without making any deductions other
than
applicable tax withholding. The custodian is
required
to maintain insurance in customary amounts to
protect
the holders of the receipts or certificates against
losses resulting from the custody arrangement. The
holders of receipts or certificates, as the real
parties in interest, are entitled to the rights and
privileges of owners of the underlying debt
obligations, including the right, in the event of
default, to proceed directly and individually
against
the U.S. Government without acting in concert with
other holders of such receipts or the custodian.
When U.S. Treasury obligations have been stripped of
their unmatured interest coupons by the holder, the
stripped coupons are sold off separately. The
principal or corpus is sold at a deep discount
because
the buyer receives only the right to receive a
future
fixed payment on the security and does not
receive any
rights to periodic interest payments. Once stripped
or separated, the corpus and coupons may be sold
separately. Typically, the coupons are sold
separately or grouped with other coupons with like
maturity dates and sold in bundled form. Purchasers
of Stripped Treasury Securities acquire, in effect,
discount obligations that are economically identical
to the "zero coupon bonds" that have been issued by
corporations.
The U.S. Treasury has facilitated transfers of
ownership of Stripped Treasury Securities by
accounting separately for the beneficial
ownership of
particular interest coupon and corpus payments on
U.S.
Treasury securities through the Federal Reserve
book-
entry record-keeping system. The Federal Reserve
program, as established by the U.S. Treasury
Department, is known as Separate Trading of
Registered
Interest and Principal of Securities or "STRIPS".
The
plan eliminates the need for the trust or custody
arrangements.
16. Swap Deposit. Swap deposits are foreign currency
short-term investments consisting of a foreign
exchange contract, a short-term note in foreign
currency and a foreign exchange forward contract t
hat
is totally hedged in U.S. currency. This type of
investment can produce competitive yield in U.S.
dollars without incurring risks of foreign exchange.
17. Time Deposit. A time deposit is a deposit in a
commercial bank for a specified period of time at a
fixed interest rate for which a negotiable
certificate
is not received.
18. Variable Amount Master Demand Note. A variable
amount
master demand note is a note which fixes a
minimum and
maximum amount of credit and provides for lending
and
repayment within those limits at the discretion
of the
lender. Before investing in any variable amount
master demand notes, the liquidity of the issuer
must
be determined through periodic credit analysis based
upon publicly available information.
19. When-issued Securities. When the purchase of
securities on a "when-issued" or on a "forward
delivery" basis is permitted, it is expected that,
under normal circumstances, delivery of such
securities will be taken. When a commitment to
purchase a security on a "when-issued" or on a
"forward delivery" basis is made, procedures are
established for such purchase consistent with the
relevant policies of the Securities and Exchange
Commission. Since those policies currently
recommend
that assets equal to the amount of the purchase be
held aside or segregated to be used to pay for the
commitment, cash, cash equivalents, or high quality
debt securities sufficient to cover any
commitments or
to limit any potential risk are expected to be
held.
However, although it is not intended that such
purchases would be made for speculative purposes and
adherence to the provisions of the Securities and
Exchange Commission policies is expected,
purchase of
securities on such bases may involve more risk than
other types of purchases. For example, the sale of
assets which have been set aside in order to meet
redemptions may be required. Also, if it is
determined that it is advisable as a matter of
investment strategy to sell the "when-issued" or
"forward delivery" securities, the then
available cash
flow or the sale of securities would be required to
meet the resulting obligations, or, although it
would
not normally be expected, from the sale of the
"when-
issued" or "forward delivery" securities themselves
(which may have a value greater or less than the
payment obligation).
Futures Contracts and Options
Futures Contracts. A futures contract is a bilateral
agreement providing for the purchase and sale of a specified
type and amount of a financial instrument, or, in the case of
futures contracts on indexes of securities, for the making
and acceptance of a cash settlement, at a stated time in the
future for a fixed price. By its terms, a futures contract
provides for a specified settlement date on which, in the
case of the majority of interest rate futures contracts, the
fixed income securities underlying a contract are delivered
by the seller and paid for by the purchaser, or on which, in
the case of a stock index futures contract, an amount equal
to a dollar amount multiplied by the difference between the
value of a stock index at the close of the last trading day
of the contract and the value of such index at the time the
futures contract was originally entered into is settled
between the purchaser and seller in cash. The purchase or
sale of a futures contract differs from the purchase or sale
of a security in that no purchase price is paid or received
at the time the contract is entered into. Instead, an amount
of cash or cash equivalents, the value of which may vary but
is generally equal to 2% or less of the value of the
contract, must be deposited with the broker as initial
deposit or "margin". Subsequent payments to and from the
broker, referred to as "variation margin", are made on a
daily basis as the value of the index underlying the futures
contract fluctuates, making positions in the futures contract
more or less valuable, a process known as "marking to the
market".
At any time prior to the expiration of a futures contract,
a trader may elect to close out its position by taking an
opposite position, subject to the availability of a secondary
market, which will operate to terminate the initial position.
At that time, a final determination of variation margin is
made and any loss experienced by a party is required to be
paid to the exchange clearing corporation, while any profit
due to a party must be delivered to it.
Futures contracts differ from options (which are described
below) in that they are bilateral agreements, with both the
purchaser and the seller equally obligated to complete the
transaction. Futures contracts call for settlement only on
the expiration date, and cannot be "exercised" at any other
time during their term.
Options on Futures Contracts. An option on a futures
contract gives the purchaser (the "holder") the right, but
not the obligation, to enter into a "long" position in the
underlying futures contract (i.e., a purchase of such futures
contract) in the case of an option to purchase (a "call"
option), or a "short" position in the underlying futures
contract (i.e., a sale of such futures contract) in the case
of an option to sell (a "put" option), at a fixed priced (the
"strike price") up to a stated expiration date. The holder
pays a nonrefundable purchase price for the option, known as
the "premium". The maximum amount of risk the purchaser of
the option assumes is equal to the premium plus related
transaction costs, although this entire amount may be lost.
Upon exercise of the option by the holder, the exchange
clearing corporation establishes a corresponding short
position for the seller (the "writer") of the option in the
case of a call option, or a corresponding long position in
the case of a put option. In the event that an option is
exercised, the parties will be subject to all the risks
associated with the trading of futures contracts, such as
payment of variation margin deposits. In addition, the
writer of an option on a futures contract, unlike the holder,
is subject to initial and variation margin requirements on
the option position.
An option, whether based on a futures contract, a stock
index or an equity security, becomes worthless to the holder
when it expires. A position in an option may be terminated
by the purchaser or seller prior to expiration by effecting
a closing purchase or sale transaction subject to the
availability of a secondary market, which is the purchase or
sale of an option of the same series (i.e., the same exercise
price and expiration date) as the option previously purchased
or sold. The difference between the premiums paid and
received represents the party's profit or loss on the
transaction.
Growth & Income may purchase put options on stock index
futures contracts, stock indexes or equity securities for the
purpose of hedging the relevant portion of its securities
portfolio against an anticipated market-wide decline or
against declines in the values of individual portfolio
securities, and Growth & Income may purchase call options on
such futures contracts as a hedge against a market advance
when it is not fully invested. Growth & Income would write
options on such futures contracts primarily for the purpose
of terminating existing positions. In general, options on
stock indexes will be employed in lieu of options on stock
index futures contracts only where they present an
opportunity to hedged at lower cost. With respect to option
on equity securities, the Portfolio may, under certain
circumstances, purchase a combination of call options on such
securities and U.S. Treasury bills. It is believed that such
a combination may more closely parallel movements in the
value of the security underlying the call option than would
the option itself.
Further, while Growth & Income generally would not write
options on individual portfolio securities it may do so under
limited circumstances known as "targeted sales" and "targeted
buys", which involve the writing of call or put options in an
attempt to purchase or sell portfolio securities at specific
desired prices. Growth & Income would receive a fee, or a
"premium", for the writing of the option. For example, where
Growth & Income seeks to sell portfolio securities at a
"targeted" price, it may write a call option at that price.
In the event that the market rises above the exercise price,
Growth & Income would receive its "targeted" price, upon the
exercise of the option, as well as the premium income. Also,
where Growth & Income seeks to buy portfolio securities at a
"targeted" price, it may write a put option at that price for
which it will receive the premium income. In the event that
the market declines below the exercise price, Growth & Income
would pay its "targeted" price upon the exercise of the
option. In the event that the market does not move in the
direction or to the extent anticipated, however, the targeted
sale or buy might not be successful and Growth & Income could
sustain a loss on the transaction which may not be offset by
the premium received. In addition, Growth & Income may be
required to forego the benefits of an intervening increase or
decline in value of the underlying security.
Risk Factors Associated with Futures and Options Transactions
In addition to any risk factors which may be described
above, the following sets forth certain information regarding
the potential risks associated with Growth & Income's futures
and options transactions.
Risk of Imperfect Correlation. Growth & Income's ability
effectively to hedge all or a portion of its portfolio
through transactions in futures, options on futures or
options on stock indexes depends on the degree to which
movements in the value of the securities or index underlying
such hedging instrument correlate with movements in the value
of the relevant portion of Growth & Income's portfolio. If
the values of the portfolio securities being hedged do not
move in the same amount or direction as the underlying
security or index, the hedging strategy for Growth & Income
might not be successful and Growth & Income could sustain
losses on its hedging transaction which would not be offset
by gains on its portfolio. It is also possible that there
may be a negative correlation between the security or index
underlying a futures or option contract and the portfolio
securities being hedged, which could result in losses both on
the hedging transaction and the portfolio securities. In
such instances, Growth & Income's overall return could be
less than if the hedging transaction had not been undertaken.
Stock index futures or options based on a narrower index of
securities may present greater risk than options or futures
based on a broad market index, as a narrower index is more
susceptible to rapid an extreme fluctuations resulting from
changes in the value of a small number of securities. Growth
& Income would, however, effect transactions in such futures
or options only for hedging purposes.
The trading of futures and options on indexes involves the
additional risk of imperfect correlation between movements in
the futures or option price and the value of the underlying
index. The anticipated spread between the prices may be
distorted due to differences in the nature of the markets,
such as differences in margin requirements, the liquidity of
such markets and the participation of speculators in the
futures and options market. The purchase of an option on a
futures contract also involves the risk that changes in the
value of underlying futures contract will not be fully
reflected in the value of the option purchased. The risk of
imperfect correlation, however, generally tends to diminish
as the maturity date of the futures contract or termination
date of the option approaches. The risk incurred in
purchasing an option on a futures contract is limited to the
amount of the premium plus related transaction costs,
although it may be necessary under certain circumstances to
exercise the option and enter into the underlying futures
contract in order to realize a profit. Under certain extreme
market conditions, it is possible that Growth & Income will
not be able to establish hedging positions, or that any
hedging strategy adopted will be insufficient to completely
protect Growth & Income.
Growth & Income will purchase or sell futures contracts or
options only if, in Chase's judgment, there is expected to be
a sufficient degree of correlation between movements in the
value of such instruments and changes in the value of the
relevant portion of Growth & Income's portfolio for the hedge
to be effective. There can be no assurance that Chase's
judgment will be accurate.
Potential Lack of a Liquid Secondary Market. The ordinary
spreads between prices in the cash and futures markets, due
to differences in the natures of those markets, are subject
to distortions. First, all participants in the futures
market are subject to initial deposit and variation margin
requirements. This could required Growth & Income to post
additional cash or cash equivalents as the value of the
position fluctuates. Further, rather than meeting additional
variation margin requirements, investors may close futures
contracts through offsetting transactions which could distort
the normal relationship between the cash and futures markets.
Second, the liquidity of the futures or options market may be
lacking. Prior to exercise or expiration, a futures or
option position may be terminated only by entering into a
closing purchase or sale transaction, which requires a
secondary market on the exchange on which the position was
originally established. While Growth & Income will establish
a futures or option position only if there appears to be a
liquid secondary market therefor, there can be no assurance
that such a market will exist for any particular futures or
option contract at any specific time. In such event, it may
not be possible to close out a position held by Growth &
Income, which could require Growth & Income to purchase or
sell the instrument underlying the position, make or receive
a cash settlement, or meet ongoing variation margin
requirements. The inability to close out futures or option
positions also could have an adverse impact on Growth &
Income's ability effectively to hedge its portfolio, or the
relevant portion thereof.
The liquidity of a secondary market in a futures contract
or an option on a futures contract may be adversely affected
by "daily price fluctuation limits" established by the
exchanges, which limit the amount of fluctuation in the price
of a contract during a single trading day and prohibit
trading beyond such limits once they have been reached. The
trading of futures and options contracts also is subject to
the risk of trading halts, suspensions, exchange or clearing
house equipment failures, government intervention, insolvency
of the brokerage firm or clearing house or other disruptions
of normal trading activity, which could at times make it
difficult or impossible to liquidate existing positions or to
recover excess variation margin payments.
Risk of Predicting Interest Rate Movements. Investments in
futures contracts on fixed income securities and related
indexes involve the risk that if Chase's investment judgment
concerning the general direction of interest rates is
incorrect, Growth & Income's overall performance may be
poorer than if it had not entered into any such contract.
For example, if Growth & Income has been hedged against the
possibility of an increase in interest rates which would
adversely affect the price of bonds held in its portfolio and
interest rates decrease instead, Growth & Income will lose
part or all of the benefit of the increased value of its
bonds which have been hedged because it will have offsetting
losses in its futures positions. In addition, in such
situations, if Growth & Income has insufficient cash, it may
have to sell bonds from its portfolio to meet daily variation
margin requirements, possibly at a time when it may be
disadvantageous to do so. Such sale of bonds may be, but
will not necessarily be, at increased prices which reflect
the rising market.
Trading and Position Limits. Each contract market on which
futures and option contracts are traded has established a
number of limitations governing the maximum number of
positions which may be held by a trader, whether acting alone
or in concert with others. Chase does not believe that these
trading and position limits will have an adverse impact on
the hedging strategies regarding Growth & Income's portfolio.
Restrictions on the use of Futures and Options Contracts
Regulations of the CFTC require Growth & Income to enter
into transactions in futures contracts and options thereon
for hedging purposes only, in order to assure that it is not
deemed to be a "commodity pool" under such regulations. In
particular, CFTC regulations require that all short futures
positions be entered into for the purpose of hedging the
value of securities held in Growth & Income's portfolio, and
that all long futures positions either constitute bona fide
hedging transactions, as defined in such regulations, or have
a total value not in excess of an amount determined by
reference to certain cash and securities positions maintained
for Growth & Income, and accrued profits on such positions.
In addition, Growth & Income may not purchase or sell such
instruments if, immediately thereafter, the sum of the amount
of initial margin deposits on its existing futures positions
and premiums paid for options on futures contracts would
exceed 5% of the market value of Growth & Income's total
assets.
When Growth & Income purchases a futures contract, an
amount of cash or cash equivalents or high quality debt
securities will be deposited in a segregated account with
Growth & Income's custodian so that the amount so segregated,
plus the initial deposit and variation margin held in the
account if its broker, will at all times equal the value of
the futures contract, thereby insuring that the use of such
futures is unleveraged.
Growth & Income's ability to engage in the hedging
transaction described herein may be limited by the current
federal income tax requirement that Growth & Income derive
less than 30% of its gross income from the sale or other
disposition of stock or securities held for less than three
months.
In addition to the foregoing requirements, the Board of
Trustees has adopted an additional restriction on the use of
futures contracts and options thereon, requiring that the
aggregate market value of the futures contracts held by
Growth & Income not exceed 50% of the market value of its
total assets. Neither this restriction nor any policy with
respect to the above-referenced restrictions, would be
changed by the Board of Trustees without considering the
policies and concerns of the various federal and state
regulatory agencies.
Approval of the investors in Growth & Income is not
required to change these investment policies.
Information about Securities Ratings
Corporate Bonds - Moody's Investors Service, Inc.
Aaa - Bonds which are rated Aaa are judged to be of the
best quality. They carry the smallest degree of investment
risk and are generally referred to as "gilt edge". Interest
payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can
be visualized are most unlikely to impair the fundamentally
strong position of such issues.
Aa - Bonds which are rated Aa are judged to be of high
quality by all standards. Together with the Aaa group they
comprise what are generally known as high-grade bonds. They
are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater
amplitude or there may be other elements present which make
the long-term risks appear somewhat larger than in Aaa
securities.
A - Bonds which are rated A possess many favorable
investment attributes and are to be considered as upper
medium-grade obligations. Factors giving security to
principal and interest are considered adequate but elements
may be present which suggest a susceptibility to impairment
sometime in the future.
Baa - Bonds which are rated Baa are considered as medium
grade obligations, i.e., they are neither highly protected
nor poorly secured. Interest payments and principal security
appear adequate for the present but certain protective
elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack
outstanding investment characteristics and in fact have
speculative characteristics as well.
Ba - Bonds which are rated Ba are judged to have
speculative elements; their future cannot be considered as
well-assured. Often the protection of interest and principal
payments may be very moderate, and thereby not well
safeguarded during both good and bad times over the future.
Uncertainty of position characterizes bonds in this class.
B - Bonds where are rated B generally lack characteristics
of the desirable investment. Assurance of interest and
principal payments or of maintenance of other terms of the
contract over any long period of time may be small.
<PAGE>
Corporate Bonds - Standard & Poor's Corporation
AAA - This is the highest rating assigned by Standard &
Poor's to a debt obligation and indicates an extremely strong
capacity to pay principal and interest.
AA - Bonds rated AA also qualify as high-quality debt
obligations. Capacity to pay principal and interest is very
strong, and in the majority of instances they differ from AAA
issues only in a small degree.
A - Bonds rated A have a strong capacity to pay principal
and interest, although they are somewhat more susceptible to
the adverse effects of changes in circumstances and economic
conditions.
BBB - Bonds rated BBB are regarded as having an adequate
capacity to pay principal and interest. Whereas they
normally exhibit protection parameters, adverse economic
conditions or changing circumstances are more likely to lead
to a weakened capacity for bonds rated BBB than for bonds in
the A category.
BB & B - Standard & Poor's describes the BB and B rated
issues together with issues rated CCC and CC. Debt in these
categories is regarded on balance as predominantly
speculative with respect to capacity to pay interest and
repay principal in accordance with the terms of the
obligation. BB indicates the lowest degree of speculation
and CC the highest degree of speculation. While such debt
will likely have some quality and protective characteristics,
these are outweighed by large uncertainties or major risk
exposures to adverse conditions.
Commercial Paper - Moody's Investors Service, Inc.
"Prime-1" - Commercial Paper issuers rated Prime-1 are
judged to be of the best quality. Their short-term debt
obligations carry the smallest degree of investment risk.
Margins of support for current indebtedness are large or
stable with cash flow and asset protection well assured.
Current liquidity provides ample coverage of near-term
liabilities and unused alternative financing arrangements are
generally available. While protective elements may change
over the intermediate or longer term, such changes are most
unlikely to impair the fundamentally strong position of
short-term obligations.
"Prime-2" - Issuers in the Commercial Paper market rated
Prime-2 are high quality. Protection for short-term holders
is assured with liquidity and value of current assets as well
as cash generation in sound relationship to current
indebtedness. They are rated lower than the best commercial
paper issuers because margins of protection may not be as
large or because fluctuations of protective elements over the
near or immediate term may be of greater amplitude.
Temporary increases in relative short and overall debt load
may occur. Alternative means of financing remain assured.
"Prime-3" - Issuers in the Commercial Paper market rated
Prime-3 have an acceptable capacity for repayment of short-
term promissory obligations. The effect of industry
characteristics and market composition may be more
pronounced. Variability in earning and profitability may
result in changes in the level of debt protection
measurements and the requirement for relatively high
financial leverage. Adequate alternate liquidity is
maintained.
Commercial Paper - Standard & Poor's Corporation
"A" - Issuers assigned this highest rating are regarded as
having the greatest capacity for timely payment. Issuers in
this category are further refined with the designation 1, 2
and 3 to indicate the relative degree of safety.
"A-1" - This designation indicates that the degree of
safety regarding timely payment is very strong.
"A-2" - Capacity for timely payment for issuers with this
designation is strong. However, the relative degree of
safety is not as overwhelming as for issues designated "A-1".
"A-3" - Issuers carrying this designation have a
satisfactory capacity for timely payment. They are, however,
somewhat more vulnerable to the adverse effects of changes in
circumstances than obligations carrying the higher
designation.
Investment Limitations
The Fund has adopted limitations regarding the investment
activity of the Vista Portfolio which are fundamental
policies and may not be changed without the approval of the
holders of a majority of the outstanding voting shares of the
Vista Portfolio. "Majority" for this purpose and under the
Investment Company Act of 1940 means the lesser of (i) 67% of
the shares represented at a meeting at which more than 50% of
the outstanding shares are represented or (ii) more than 50%
of the outstanding shares. A complete statement of all such
limitations are set forth below.
The Vista Portfolio will not:
1. Invest more than 25% of its total assets (taken at
market value at the time of each investment) in the
securities of issuers primarily engaged in the same
industry; utilities will be divided according to
their
services; for example, gas, gas transmission,
electric
and telephone each will be considered a separate
industry for purposes of this restriction; provided
that there shall be no limitation on the purchase of
obligations issued or guaranteed by the U.S.
Government, or its agencies or instrumentalities, or
of certificates of deposit and bankers' acceptances,
and positions in permissible options and futures
will
not be subject to this restriction.
2. Alone or together with any other investor make
investments for the purpose of exercising control
over, or management of any issuer.
3. Purchase or sell interests in commodities,
commodities
contracts, oil, gas or other mineral exploration or
development programs, or real estate, (including
limited partnership interests but excluding
securities
secured by real estate or interests therein), except
that the Vista Portfolio may purchase securities of
issuers which invest or deal in any of the above and
may engage in permissible futures and options
transactions.
4. Purchase securities which cannot be sold without
registration or the filing of a notification under
federal or state securities laws if, as a result,
such
investments would exceed 10% of the value of the
Vista
Portfolio's total assets.
5. Purchase any securities on margin (except that the
Vista Portfolio may obtain such short-term credit as
may be necessary for the clearance of purchases and
sales of portfolio securities, and the Vista
Portfolio
may make margin payments in connection with
transactions in futures contracts and options) or
make
short sales of securities or maintain a short
position, except that the Vista Portfolio may sell
short against the box (except that not more than 10%
of the Vista Portfolio's total assets (taken at
market
value) may be held as collateral for such sales
at any
one time).
6. Make loans, except as provided in limitation (7)
below
and except through the purchase of obligations in
private placements (the purchase of publicly-traded
obligations are not being considered the making of a
loan) and further, through the use of repurchase
agreements or the purchase of short-term
obligations;
however, not more than 10% of the Vista Portfolio's
total assets may be invested in repurchase
agreements
maturing in more than seven days.
7. Lend its portfolio securities in excess of 30% of
its
total assets, taken at market value at the time
of the
loan, and provided that such loan shall be made in
accordance with the guidelines set forth under
"Lending of Portfolio Securities" of this
Statement of
Additional Information.
8. Borrow amounts in excess of 33 1/3% of its total
assets (including the amount borrowed), taken at
market value at the time of the borrowing, and then
only from banks as a temporary measure for
extraordinary or emergency purposes. In the
event the
Fund borrows in excess of 5% of its total assets, at
the time of such borrowing it will have an asset
coverage of at least 300% and will not purchase
additional investment securities.
9. Mortgage, pledge, hypothecate or in any manner
transfer, as security for indebtedness, any
securities
owned or held by the Portfolio except as may be
necessary in connection with borrowings mentioned in
limitation (8) above, and then such mortgaging,
pledging or hypothecating may not exceed 33 1/3% of
the Vista Portfolio's total assets, taken at market
value at the time thereof; provided that collateral
arrangements with respect to permissible futures and
options transactions, including initial and
variation
margin payments, are not considered to be the pledge
of assets for purposes of this restriction.
10. Underwrite securities of other issuers except
insofar
as the Vista Portfolio may be deemed an underwriter
under the Securities Act of 1933 in selling
portfolio
securities.
11. Write, purchase or sell puts, calls or combinations
thereof, except that Vista Portfolio may buy and
sell
permissible options and futures, and may buy and
sell
put and call warrants, the values of which are based
upon securities indices.
In addition, Growth & Income is subject to additional
investment limitations which are set forth in its prospectus
and statement of additional information.
Growth & Income is also subject to certain non-fundamental
"operating" policies which may be changed by the Board of
Trustees of Growth & Income. Please see the Statement of
Additional Information of Growth & Income regarding these
operating policies.
Lending of Portfolio Securities
The Vista Portfolio is not permitted to make loans to other
persons, except (i) through the lending of its portfolio
securities and provided that any such liens not exceed 30% of
the Vista Portfolio's total assets (taken at market value),
(ii) through the use of repurchase agreements or the purchase
of short-term obligations and provided that not more than 10%
of the Vista Portfolio's total assets will be invested in
repurchase agreements maturing in more than seven days, or
(iii) by purchasing, subject to the limitation in paragraph
6 above, a portion of an issue of debt securities of types
commonly distributed privately to financial institutions; for
purposes of this limitation the purchase of short-term
commercial paper and other debt securities which are part of
an issue offered to the public shall not be considered the
making of a loan.
For purposes of the investment restrictions described
above, the issuer of a tax-exempt security is deemed to be
the entity (public or private) ultimately responsible for the
payment of the principal of and interest on the security.
For purposes of Investment Restriction No. 7 industrial
developments bonds, where the payment of principal and
interest is the ultimate responsibility of companies within
the same industry, are grouped together as an "industry".
In the event the Vista Portfolio were ever to redeem its
investment in Growth & Income and the Investment Adviser were
to manage the Vista Portfolio's assets directly (or delegate
such management to a sub-adviser), the Vista Portfolio would
be subject to the above-described fundamental investment
policies. If the Vista Portfolio were to redeem its
investment in Growth & Income and invest in another
investment company, the shareholders of the Vista Portfolio
would be asked to approve the adoption of the investment
policies of such investment company to the extent necessary
or appropriate to allow the Vista Portfolio to make such
investment.
<PAGE>
MANAGEMENT OF THE FUND
The Fund
Directors and Officers
The directors and executive officers of the Fund and their
principal occupations for at least the last five years are
set forth below:
Name, Relationship with
Principal
Occupation
the Fund, and Address
Past Five Years
Rex Jennings
Economic Development
Director2
Consultant (since 1987);
Richard P. Koeppe, Ph.D.
Retired Superintendent,
Director3
Denver
Public
Schools
Dennis Low
The
Great-West Life
Assurance
Director1 5
Company: Executive
Vice-President, Financial
Services
(since 1991); Senior
Vice-President, Individual
(1987-1990)
James D. Motz
The
Great-West Life
Assurance
Director1 5
Company: Senior
Vice-President,
Employee Benefits Operations
(since 1991); Vice-President,
Group (1981-1990)
Sanford Zisman
Attorney, Zisman & Ingraham,
P.C.
Director4
Glen R. Derback
The
Great-West Life
Assurance
Treasurer, Principal
Company, Vice-
President,
Financial and Accounting
Financial Control
(since 1984);
Officer1 5
Ruth B. Lurie
The
Great-West Life
Assurance
Secretary1 5
Company, Vice-
President and
Counsel (since 1988)
_________________________________
1 Interested person as defined in the Investment Company Act
of 1940 and affiliated person of Investment Adviser.
2 12501 East Evans Circle, Unit C, Aurora Colorado 80014
3 8679 East Kenyon Avenue, Denver, Colorado 80237
4 3773 Cherry Creek North Drive, Suite 250, Denver, Colorado
80209.
5 The Great-West Life Assurance Company, 8515 E. Orchard
Road, Englewood, Colorado 80111.
<PAGE>
The Investment Adviser of the Fund
The information that follows supplements the information
provided about the Investment Adviser under the caption
"Management of the Fund - Investment Adviser of the Fund" in
the Prospectus.
The Great-West Life Assurance Company (the "Investment
Adviser") serves as the investment adviser to the Fund
pursuant to an Investment Advisory Agreement dated April 1,
1982 with the Fund. The Investment Adviser is a 99.4% owned
subsidiary of Great-West Lifeco Inc., which in turn is an
86.4% subsidiary of Power Financial Corporation, Montreal,
Quebec. A majority of the common stock of Power Financial
Corporation is owned by 171263 Canada Inc. 171263 Canada Inc
is a wholly owned subsidiary of Power Corporation of Canada,
which, in turn, is controlled by a Canadian investor, Paul
Desmarais, and his associates.
The Investment Advisory Agreement, as amended, was
considered by the Fund's Board of Directors, including a
majority of the Directors who are not "interested persons"
(as defined in the Investment Company Act of 1940), on April
11, 1995. The Agreement will remain in effect until April 1,
1996 and will continue in effect from year to year if
approved annually (a) by the Board of Directors of the Fund
or by a majority of the outstanding shares of the Fund,
including a majority of the outstanding shares of each
portfolio, and (b) by a majority of the Directors who are not
parties to such contract or "interested persons" of any such
party. The agreement is not assignable and may be terminated
without penalty on 60 days' written notice at the option of
either party or by the vote of the shareholders of the Fund.
While the Investment Adviser is at all times subject to the
direction of the Board of Directors of the Fund, the
Investment Advisory Agreement provides that the Investment
Adviser, subject to review by the Board of Directors, is
responsible for the actual management of the Fund and has
responsibility for making decisions to buy, sell or hold any
particular security. The Investment Adviser provides the
portfolio managers for the Fund. Such managers consider
analysis from various sources, make the necessary investment
decisions and effect transactions accordingly. The
Investment Adviser also is obligated to perform certain
administrative and management services for the Fund and is
obligated to provide all the office space, facilities,
equipment and personnel necessary to perform its duties under
the Agreement. With respect to the Vista Portfolio, because
all the Portfolio's investible assets will be invested in
Growth & Income, the investment adviser to Growth & Income
will manage Growth & Income in accordance with Growth &
Income's stated investment objectives and policies, making
investment decisions for Growth & income and placing orders
to buy and sell securities on behalf of Growth & Income.
Great-West will be responsible for accounting and
administration of the Vista Portfolio only.
Fees
Since inception of the Portfolio on December 21, 1994, the
Investment Adviser has been paid $ 132,910.16 for its
administrative and accounting services.
The Growth and Income Portfolio ("Growth & Income")
Trustees and Officers
The Trustees and officers and their principal
occupations for at least the past five years are set forth
below. Their titles may have varied during that period.
Asterisks indicate those Trustees and officers that are
"interested persons" (as defined in the 1940 Act). Unless
otherwise indicated below, the address of each officer is 125
W. 55th Street, New York, New York 10019.
FERGUS REID, III* - Trustee. Chairman of the Board of
Trustees of Mutual Fund Group and Mutual Fund Trust.
Chairman and Chief Executive Officer, Lumelite Corporation,
since September 1985; Trustee, Morgan Stanley Portfolios;
from 1982 through 1984, Managing Director, Bernhard
Associates (venture capital firm).
Address: 971 West Road, New Canaan, Connecticut 06840.
DR. RICHARD E. TEN HAKEN - Trustee. Former District
Superintendent of Schools, Monroe No.2 and Orleans Counties,
New York; Chairman of the Finance and the Audit and
Accounting Committees, Member of the Executive Committee;
Chairman of the Board and President, New York State Teachers'
Retirement System.
Address: 4 Barnfield Road, Pittsford, New York 14534.
H. RICHARD VARTABEDIAN* - Trustee, President and
Chairman of Growth and Income. Consultant, Republic Bank of
New York; formerly, Senior Investment Officer, Division
Executive of the Investment Management Division of The Chase
Manhattan Bank, N.A., 1980 through 1991.
Address: P.O. Box 296, Beach Road, Hendrick's Head,
Southport, Maine 04576
STUART W. CRAGIN, JR. - Trustee. Retired; formerly,
President, Fairfield Testing Laboratory, Inc. He has
previously served in a variety of marketing, manufacturing
and general management positions with Union Camp Corp.,
Trinity Paper & Plastics Corp., and Conover Industries.
Address: 108 Valley Road, Cos Cob, Connecticut 06807.
IRVING L. THODE - Trustee. Retired; Vice President of
Quotron Systems. He has previously served in a number of
executive positions with Control Data Corp., including
President of its Latin American Operations, and General
Manager of its Data Services business.
Address: 80 Perkins Road, Greenwich, Connecticut 06830.
The Board of Trustees met seven times during the
twelve months ended December 31, 1995, and each of the
Trustees attended at least 75% of those meetings.
The Board of Trustees of the Trust presently has an Audit
Committee. The members of the Audit Committee are Messrs.
Ten Haken (Chairman), Vartabedian Cragin, Thode and Reid.
The function of the Audit Committee is to recommend
independent auditors and monitor accounting and financial
matters. The Audit Committee met two times during the fiscal
year ended October 31, 1995.
* Interested Trustees as defined under the 1940 Act.
Principal Executive Officers
The principal executive officers of the Trust are as
follows:
H. RICHARD VARTABEDIAN* - President and Trustee.
MARTIN R. DEAN* - Treasurer and Assistant Secretary;
Vice President, BISYS Group Portfolios, Inc.
ANN BERGIN* - Secretary and Assistant Treasurer; Vice
President, BISYS Funds Group, Inc.; and Secretary, Vista
Broker-Dealer Services, Inc.
The Investment Adviser of Growth & Income
The Chase Manhattan Bank, N.A. ("Chase") manages the assets
of Growth & Income pursuant to an investment advisory
agreement, dated November 15, 1993 (the "Advisory
Agreement"). Subject to such policies as the Board of
Trustees may determine, Chase makes investment decisions for
Growth & Income. Pursuant to the terms of the Advisory
Agreement, Chase provides Growth & Income with such
investment advice and supervision as it deems necessary for
the proper supervision of Growth & Income's investments.
Chase continuously provides investment programs and
determines from time to time what securities shall be
purchased, sold or exchanged and what portion of Growth &
Income's assets shall be held uninvested. Chase furnishes, at
its own expense, all services, facilities and personnel
necessary in connection with managing the investments and
effecting portfolio transactions for Growth & Income. The
other expenses attributable to, and payable by Growth &
Income, are described under "Investment Adviser of Growth &
Income Portfolio" in the Prospectus. The Advisory Agreement
for Growth & Income will continue in effect from year to year
only if such continuance is specifically approved at least
annually by the Board of Trustees or by vote of a majority of
Growth & Income's outstanding voting securities and, in
either case, by a majority of the Trustees who are not
parties to the Advisory Agreement or interested persons of
any such party, at a meeting called for the purpose of voting
on such Advisory Agreement.
Pursuant to the terms of the Advisory Agreement, Chase is
permitted to render services to others. Each Advisory
Agreement is terminable without penalty by Growth & Income on
not more than 60 days', nor less than 30 days' written notice
when authorized either by a majority Growth & Income's
shareholders or by a vote of a majority of the Board of
Trustees of Growth & Income, or by Chase on not more than 60
days', nor less than 30 days', written notice, and will
automatically terminate in the event of its "assignment" (as
defined in the 1940 Act). The Advisory Agreement provides
that Chase under such Agreement shall not be liable for any
error of judgment or mistake of law or for any loss arising
out of any investment or for any act or omission in the
execution of portfolio transactions for Growth & Income,
except for wilful misfeasance, bad faith or gross negligence
in the performance of its duties, or by reason of reckless
disregard of its obligations and duties thereunder.
On August 27, 1995, The Chase Manhattan Corporation
announced its entry into an Agreement and Plan of Merger (the
"Merger Agreement") with Chemical Banking Corporation
("Chemical"), a bank holding company, pursuant to which The
Chase Manhattan Corporation will merge with and into Chemical
(the "Holding Company Merger"). Under the terms of the
Merger Agreement, Chemical will be the surviving corporation
in the Holding Company Merger, which will create the second
largest bank holding company in the United States based on
assets. The consummation of the Holding Company Merger is
subject to certain closing conditions. On December 11, 1995,
the respective shareholders of The Chase Manhattan
Corporation and Chemical voted to approve the Holding Company
Merger. The Holding Company Merger is expected to be
completed on or about March 31, 1996.
Subsequent to the Holding Company Merger, it is
expected that the adviser to Growth & Income, The Chase
Manhattan Bank, N.A., will be merged with and into Chemical
Bank, a New York State chartered bank ("Chemical Bank")(the
"Bank Merger" and together with the Holding Company Merger,
the "Mergers"). The surviving bank will continue operations
under the name The Chase Manhattan Bank (as used herein, the
term "Chase" refers to The Chase Manhattan Bank, N.A. and its
successor in the Bank Merger, and the term "Adviser" means
Chase (including its successor in the Bank Merger) in its
capacity as investment adviser to Growth & Income). The
consummation of the Bank Merger is subject to certain closing
conditions, including the receipt of certain regulatory
approvals. The Bank Merger is expected to occur in July
1996.
Chemical is a publicly owned bank holding company
incorporated under Delaware law and registered under the
Federal Bank Holding Company Act of 1956, as amended. As of
December 31, 1995, through its direct or indirect
subsidiaries, Chemical managed more than $57 billion in
assets, including approximately $6.9 billion in mutual fund
assets in 11 mutual fund portfolios. Chemical Bank is a
wholly owned subsidiary of Chemical and is a New York State
chartered bank.
In the event the operating expenses of Growth & Income,
when combined with those of the Vista Portfolio, including
all investment advisory, administration and sub-
administration fees, but excluding brokerage commissions and
fees, taxes, interest and extraordinary expenses such as
litigation, for any fiscal year exceed the most restrictive
expense limitation applicable to Growth & Income imposed by
the securities laws or regulations thereunder of any state in
which the shares of Growth & Income are qualified for sale,
as such limitations may be raised or lowered from time to
time, the Adviser shall reduce its advisory fee (which fee is
described below) to the extent of its share of such excess
expenses. The amount of any such reduction to be borne by
the Adviser shall be deducted from the monthly advisory fee
otherwise payable with respect to Growth & Income during such
fiscal year; and if such amount should exceed the monthly
fee, the Adviser shall pay to Growth & Income its share of
such excess expenses no later than the last day of the first
month of the next succeeding fiscal year.
In consideration of the services provided by Chase pursuant
to the Advisory Agreement, Growth & Income pays an investment
advisory fee computed and paid monthly based on a rate equal
to .40%. of Growth & Income's average daily net assets, on
an annualized basis for Growth & Income's then-current fiscal
year. However, Chase may voluntarily agree to waive a
portion of the fees payable to it on a month-to-month basis.
The Growth & Income Administrator
Pursuant to an Administration Agreement, dated
November 15, 1993 (the "Administration Agreement"), Chase
serves as administrator of Growth & Income. Chase provides
certain administrative services to Growth & Income, including
among other responsibilities, coordinating the negotiation of
contracts and fees with, and the monitoring of performance
and billing of, Growth & Income's independent contractors and
agents; preparation for signature by an officer of Growth &
Income of all documents required to be filed for compliance
by Growth & Income with applicable laws and regulations
excluding those of the securities laws of various states;
arranging for the computation of performance data, including
net asset value and yield; responding to shareholder
inquiries; and arranging for the maintenance of books and
records of Growth & Income and providing, at its own expense,
office facilities, equipment and personnel necessary to carry
out its duties. The administrator does not have any
responsibility or authority for the management of Growth &
Income, the determination of investment policy, or for any
matter pertaining to the distribution of shares of Growth &
Income or the Vista Portfolio.
Under the Administration Agreement, Chase renders
administrative services to others. The administration
agreement will continue in effect from year to year with
respect to Growth & Income only if such continuance is
specifically approved at least annually by the Board of
Trustees or by vote of a majority of Growth & Income's
outstanding voting securities and, in either case, by a
majority of the Trustees who are not parties to the
administration agreement of "interested person" (as defined
in the 1940 Act) or any such party. The administration
agreement is terminable without penalty by the Trust on
behalf of Growth & Income on 60 days' written notice when
authorized either by a majority vote of Growth & Income's
shareholders or by a vote of a majority of the Board of
Trustees, including a majority of the Trustees who are not
"interested persons" (as defined in the 1940 Act) Growth &
Income, or by the Administrator on 60 days' written notice,
and will automatically terminate in the event of its
"assignment" (as defined in the 1940 Act). The
administration agreement also provides that neither Chase nor
its personnel shall be liable for any error of judgment or
mistake of law or for any act or omission in the
administration or management of Growth & Income, except for
wilful misfeasance, bad faith or gross negligence in the
performance of its or their duties or by reason of reckless
disregard of its or their obligations and duties under the
administration agreements.
In addition, the administration agreement provides
that, in the event the operating expenses of Growth & Income,
including all investment advisory, administration and sub-
administration fees, but excluding brokerage commissions and
fees, taxes, interest and extraordinary expenses such as
litigation, for any fiscal year exceed the most restrictive
expense limitation applicable to Growth & Income imposed by
the securities laws or regulations thereunder of any state in
which the shares of Growth & Income or Vista Portfolio are
qualified for sale, as such limitations may be raised or
lowered from time to time, Chase shall reduce its
administration fee (which fee is described below) to the
extent of its share of such excess expenses. The amount of
such reduction to be borne by Chase shall be deducted from
the monthly administration fee otherwise payable to Chase
during such fiscal year; and if such amounts should exceed
the monthly fee, Chase shall pay to Growth & Income its share
of such excess expenses no later than the last day of the
first month of the next succeeding fiscal year.
In consideration of the services provided Chase
pursuant to the administration agreement, Chase receives from
Growth & Income a fee computed and paid monthly at an annual
rate equal to 0.05% of Growth & Income's average daily net
assets, on an annualized basis for Growth & Income's then-
current fiscal year. Chase may voluntarily waive a portion
of the fees payable to it with respect to Growth & Income on
a month-to-month basis.
For the fiscal years ended October 31, 1992, 1993,
1994, and 1995, Chase, was paid or accrued the following
administration fees and voluntarily waived the amounts in
parentheses following such fees: $85,010 ($2,399); $469,585;
$600,633 and $851,900.
PURCHASE AND REDEMPTION OF SHARES
As of October 31, 1995, 100% of the 40,717,195 outstanding
shares of the Vista Portfolio were held of record by
FutureFunds II Series Account.
<PAGE>
CALCULATION OF YIELDS
As summarized in the Prospectus under the heading
"Performance Related Information", yields of this Portfolio
will be computed by annualizing a recent month's net
investment income, divided by a Portfolio share's net asset
value on the last trading day of that month multiplied by the
average number of outstanding shares for the period. Net
investment income will reflect amortization of any market
value premium or discount of fixed income securities and may
include recognition of a pro rata portion of the stated
dividend rate of dividend paying portfolio securities. The
yields of the Portfolios will vary from time to time
depending upon market conditions and the composition of the
Portfolios. Yield should also be considered relative to
changes in the value of the shares of the Portfolios and to
the relative risks associated with the investment objectives
and policies of the Portfolios. Below is an example of the
yield calculation for the Portfolio.
Maxim Vista Growth & Income Portfolio
The following is an example of the yield calculation for
the Portfolio based on a 30-day period ending October 31,
1995.
Formula: YIELD = 2[(a+b) + 1)6-1]
cd
Where: a = net
investment income earned during the
period by
the portfolio company
attributable to shares owned by the sub-
account.
b = expenses accrued for the
period (net of
reimbursements).
c = the average daily number of
accumulation units
outstanding during the period.
d = the maximum offering price
per accumulation unit
on the last day of the period
Yield as of October 31, 1995:
a = 86,747
b = 22,893
c = 38,799,606
d = 1.21334
Therefore, 1 month yield as of October 31, 1995 is 2.81%
.
CALCULATION OF TOTAL RETURN
As summarized in the Prospectus under the heading
"Performance Related Information", total return is a measure
of the change in value of an investment in a Portfolio over
the period covered, which assumes any dividends or capital
gains distributions are reinvested in that Portfolio
immediately rather than paid to the investor in cash. The
formula for total return used herein includes four steps:
(1) adding to the total number of shares purchased by a
hypothetical $1,000 investment in the Portfolio all
additional shares which would have been purchased if all
dividends and distributions paid or distributed during the
period had been immediately reinvested; (2) calculating the
value of the hypothetical initial investment of $1,000 as of
the end of the period by multiplying the total number of
shares owned at the end of the period by the net asset value
per share on the last trading day of the period; (3) assuming
redemption at the end of the period and deducting any
applicable contingent deferred sales charge; and (4) dividing
this account value for the hypothetical investor by the
initial $1,000 investment. Total return will be calculated
for one year, five years and ten years or some other relevant
periods if a Portfolio has not been in existence for at least
ten years. Below is an example of the total return
calculation for the Portfolio.
MAXIM VISTA GROWTH & INCOME PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA: P(1=T)N = ERV
WHERE:
T = Average annual total return.
N = The number of years including portions of years,
where
applicable, for which the performance is being
measured.
ERV = Ending redeemable value of a
hypothetical $1.00
payment made at the inception
of the portfolio.
P = Opening redeemable value of a hypothetical $1.00
payment made at the inception of the portfolio.
The above formula can be restated to solve for T as follows:
T = [ERV/P)1/N] -1
Inception to date total return as of October 31, 1995:
ERV = 1.23161
N = 0.863
P = 1.00
Therefore, total return as of October 31, 1995 is 27.30%
compounded annually.<PAGE>
Price Make-up Sheet
Maxim Vista Growth & Income Portfolio
Period Ended 10/31/95
Per Share
Amount
Undistributed Net Income -
Beginning of Year
$ 0
Dividend Income
794,012
Interest Income
Operational Expenses
(155,092)
Net Investment Income
638,920
Dividend Distribution -
End of Year
638,577
Undistributed Net Investment
Income -End of Year
343
.0000
Net Realized Gain(Loss) on
Investments - Beginning of Year
0
Net Realized Gain(Loss) on
Investments End of Year
1,414,461
Distribution from Net
Realized Gain
0
Accumulated Undistributed Net
Realized Gain(Loss)
on Investments
1,414,461
.0347
Net Unrealized Appreciation
(Depreciation) on Investments
4,389,466
.1078
Capital Stock at Par
4,071,719
.1000
Additional Paid-In Capital
39,527,174
.9708
Net Assets
49,403,163
1.2133
Shares Outstanding
40,717,195
<PAGE>
PART B
FINANCIAL STATEMENTS
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Stockholders of
Maxim Series Fund, Inc.:
We have audited the accompanying statement of assets and
liabilities, of Maxim Vista Growth & Income Portfolio of
Maxim Series Fund, Inc. as of October 31, 1995, and the
related statement of operations, statement of changes in net
assets and the financial highlights for the period from
December 21, 1994 (inception) to October 31, 1995. These
financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and
financial highlights based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about
whether the financial statements and financial highlights are
free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures
included confirmation of securities owned as of October 31,
1995, by correspondence with the custodian and brokers, and
the application of alternative auditing procedures when
confirmations were not received. An audit also includes
assessing the accounting principles used and significant
estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, such financial statements and financial
highlights present fairly, in all material respects, the
financial position of Maxim Vista Growth & Income Portfolio
of Maxim Series Fund, Inc. at October 31, 1995 and the
results of its operations, the changes in net assets and the
financial highlights for the period from December 21, 1994
(inception) to October 31, 1995, in conformity with generally
accepted accounting principles.
/s/ DELOITTE & TOUCHE LLP
December 28, 1995
<PAGE>
<TABLE>MAXIM SERIES FUND INC. <CAPTION> STATEMENT OF ASSETS
AND LIABILITIES<PAGE>
OCTOBER 31, 1995 <C> MAXIM VISTA GROWTH <PAGE>
<PAGE>
& INCOME <S> PORTFOLIO ASSETS: Investments in Hub - Growth and Income
Portfolio, at value<PAGE>
$ 49,416,846 Receivable for investments sold 64,033
Total Assets<PAGE>
49,480,879 LIABILITIES: Payable for redemptions 55
,535<PAGE>
Other liabilities 22,181 Total Liabilities 77,716 NET
ASSETS<PAGE>
$ 49,403,163
<PAGE>
NET ASSETS REPRESENTED BY: Capital stock, $.10 par value $ 4,071,719
Additional paid-in capital<PAGE>
39,527,174 Net unrealized appreciation on
investments<PAGE>
4,389,466 Undistributed net investment income 343
Accumulated undistributed net
realized gain on investments<PAGE>
1,414,461 NET ASSETS $ 49,403,163 NET
ASSET VALUE PER OUTSTANDING SHARE<PAGE>
$ 1.2133 SHARES OF CAPITAL STOCK:
Authorized<PAGE>
100,000,000 Outstanding 40,717,195 <PAGE>
<PAGE>
See notes to financial statements<FN>. <PAGE>
</TABLE>
<TABLE> MAXIM SERIES FUND INC.<PAGE>
<CAPTION> STATEMENT OF OPERATIONS
<PAGE>
FOR THE PERIOD DECEMBER 21, 1994 (Inception) TO OCTOBER 31,
1995 <PAGE>
<PAGE>
<C> MAXIM VISTA GROWTH & INCOME PORTFOLIO <S>INVESTMENT INCOME
:<PAGE>
Investment income allocated from Hub
portfolio<PAGE>
$ 932,323 Expenses allocated from Hub portfolio (138,311)
Total investment income from Hub
portfolio<PAGE>
794,012 EXPENSES: Advisory fees 155,092 Total
expenses<PAGE>
155,092 NET INVESTMENT INCOME 638,920 <PAGE>
REALIZED AND UNREALIZED GAIN ON
INVESTMENTS:<PAGE>
Net realized gain on investments 1,414,461 Change in net
unrealized appreciation on
investments<PAGE>
4,389,466 Net change in realized and unrealized
appreciation on investments<PAGE>
5,803,927 NET INCREASE IN NET ASSETS
RESULTING<PAGE>
FROM OPERATIONS $ 6,442,847 <PAGE>
See notes to financial statements.FN
<PAGE>
<PAGE>
</TABLE>
<TABLE>MAXIM SERIES FUND, INC.<PAGE>
<CAPTION> STATEMENT OF CHANGES IN
NET ASSETS<PAGE>
FOR THE PERIOD DECEMBER 21, 1994 (Inception) TO
OCTOBER 31, 1995
<PAGE>
<C> MAXIM VISTA GROWTH & INCOME PORTFOLIO <S>
INCREASE IN NET ASSETS:<PAGE>
OPERATIONS: Net investment income $ 638,920<PAGE>
Net realized gain<PAGE>
1,414,461 Change in net unrealized appreciation 4,389
,466<PAGE>
Net increase in net assets resulting
from operations<PAGE>
6,442,847 DISTRIBUTION TO SHAREHOLDERS: From net
investment income<PAGE>
(638,577) Total distribution (638,577) SHARE
TRANSACTIONS:<PAGE>
Net proceeds from sale of shares 54,737,972 Reinvestment
of distribution<PAGE>
638,577 Cost of shares redeemed (11,777,656) Net i
ncrease in net assets resulting
from share transactions<PAGE>
43,598,893 Total increase in net assets 49,
403,163<PAGE>
NET ASSETS: Beginning of period 0 End of period $ 49,403,
163<PAGE>
See notes to financial statements.<FN> <PAGE>
</TABLE>
<PAGE>
<TABLE>MAXIM SERIES FUND, INC. <CAPTION> MAXIM VISTA GROWTH & INCOME
PORTFOLIOFINANCIAL HIGHLIGHTS <PAGE>
Selected data for a share of capital stock of
the portfolio
for the period December 21, 1994 (inception) to<PAGE>
October 31, 1995 were as
follows: <PAGE>
<PAGE>
<C> Period Ended October 31,
1995<PAGE>
<S>Net Asset Value, Beginning of
Period<PAGE>
$ 1.0000 Income From Investment Operations Net Investment
Income<PAGE>
0.0174 Net realized and unrealized gain 0.2133 Total Income
From Investment Operations<PAGE>
0.2307 Less Distributions From Net
Investment Income<PAGE>
(0.0174) Total Distributions (0.0174) Net Asset
Value, End of Period<PAGE>
$ 1.2133 Total Return 27.30% * Net Assets, End
of Period<PAGE>
$ 49,403,163 Ratio of Expenses to Average Net Assets 1.01%
*<PAGE>
Ratio of Net Investment Income to Average
Net Assets<PAGE>
2.21% * * Annualized <PAGE>
/TABLE
<PAGE>
MAXIM SERIES FUND, INC.
MAXIM VISTA GROWTH & INCOME PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
1. HISTORY OF THE FUND
Maxim Series Fund, Inc. (the Fund) is a Maryland
corporation organized on December 7, 1981 as an open-end
management investment company. The Maxim Vista Growth
& Income Portfolio (the Portfolio) is non-diversified.
The Portfolio commenced operations on December 21, 1994.
Interests in the Portfolio are represented by separate
classes of beneficial interest of the Fund. Shares of
the Fund are sold only to FutureFunds Series Account II
of Great-West Life & Annuity Insurance Company (the
Company), to fund benefits under variable annuity
contracts and variable life insurance policies issued by
the Company. The shares are sold at a price equal to
the respective net asset value per share of each class
of shares.
The Fund seeks to achieve the investment objective of
the Portfolio through the adoption of a Hub and Spoke
structure. Contribution of Portfolio (i.e., the Spoke)
investible funds to the Hub portfolio are made in
exchange for beneficial interests in the Hub portfolio
of equal value. The Hub portfolio is the Growth and
Income Portfolio; a non-diversified open-end management
investment company organized as a trust under the laws
of the State of New York and registered under the
Investment Company Act of 1940, as amended. Financial
statements of the Hub portfolio are presented following
the Portfolios financial statements.
The portfolio's percentage interest in the Hub portfolio
is 2.67% at October 31, 1995.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of the significant accounting
policies of the Fund, which are in accordance with the
accounting principles generally accepted in the
investment company industry:
Security Transactions
Security transactions are recorded at the earlier of
trade date or the date a commitment is made to buy or
sell the related investment. The cost of investments
sold is determined on the basis of first in, first out.
Distributions to shareholders are recorded on the ex-
dividend date. Dividends from investment income of the
Portfolio are declared and reinvested quarterly and
dividends from capital gains are declared and reinvested
annually.
Security Valuation
The Portfolios investment in the Hub portfolio is
valued at the last reported net asset value of the Hub
portfolio. The portfolio receives an allocation of
investment income and Hub expenses as well as realized
and unrealized gains and losses on a daily basis from
the Hub. In addition, the Portfolio accrues its own
expenses daily as incurred.
Federal Income Taxes
For federal income tax purposes, the Portfolio qualifies
as a regulated investment company under the provisions
of the Internal Revenue Code by distributing
substantially all of its taxable net income (both
ordinary and capital gain) to its shareholders and
complying with the requirements for regulated investment
companies. Accordingly, no provision for federal income
taxes has been made
<PAGE>
3. INVESTMENT ADVISORY AGREEMENT
The Fund has entered into an investment advisory
agreement with The Great-West Life Assurance Company
(parent of the Company). As compensation for its
services to the Fund with respect to the Maxim Vista
Growth & Income Portfolio, the investment advisor
receives monthly compensation at the annual rate of .53%
of the average daily net assets of the Maxim Vista
Growth & Income Portfolio.
4. Investment Transactions - Increases and decreases in the
Portfolio's investment in the Hub portfolio during the
period December 21, 1994 to October 31, 1995 were as
follows:
[C]
[C]
TABLE
<PAGE>
Increases in Decreases in Hub Portfolio
Investment<PAGE>
Hub Portfolio
Investment<PAGE>
Maxim Vista Growth &
Income Portfolio<PAGE>
$ 54,737,972 $ 11,777,656
5. Transactions in shares of beneficial interest during
the period December 21, 1994 to October 31, 1995 were
as follows:
<S>
Shares sold<PAGE>
50,481,605 Shares issued in reinvestment of
distributions<PAGE>
544,981 Shares redeemed (10,309,391
)<PAGE>
Net increase in shares of
beneficial interest outstanding<PAGE>
40,717,195 Outstanding shares at:
Beginning of period<PAGE>
0 End of Period 40,717,195
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees
and Beneficial Interest Holders of
Growth and Income Portfolio
Capital Growth Portfolio
International Equity Portfolio
In our opinion, the accompanying statement of assets of
liabilities, including
the portfolios of investments, and the related statements
of operations and of
changes in net assets present fairly, in all material
respects, the financial
position of Growth and Income Portfolio, Capital Growth
Portfolio and
International Equity Portfolio (the "Portfolios") at
October 31, 1995, the
results of each of their operations for the year then ended
and the changes in
each of their net assets for the periods presented, in
conformity with
generally accepted accounting principles. These financial
statements are the
responsibility of the Portfolios' management; our
responsibility is to express
an opinion on these financial statements based on our
audits. We conducted our
audits of these financial statements in accordance with
generally accepted
auditing standards which require that we plan and perform
the audit to obtain
reasonable assurance about whether the financial statements
are free of
material misstatement. An audit includes examining, on a
test basis, evidence
supporting the amounts and disclosures in the financial
statements, assessing
the accounting principles used and significant estimates
made by management,
and evaluating the overall financial statement
presentation. We believe that
our audits, which included confirmation of securities at
October 31, 1995 by
correspondence with the custodian and brokers and the
application of
alternative auditing procedures where confirmations from
brokers were not
received, provide a reasonable basis for the opinion
expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, NY 10036
December 15, 1995 <PAGE>
Statement of Assets and Liabilities October 31, 1995
- -----------------------------------------------------------
- -------<CAPTION>------------
Growth & International
Income Capital Growth Equity
Portfolio Portfolio Portfolio
- -------------- -------------- ------------
ASSETS:
Investment securities, at value (Note 1)..............
$1,840,590,355 $1,009,364,734 $ 32,134,987
Cash..................................................
152 152,545 --
Foreign Currency (Cost $761,993)......................
-- -- 757,663
Receivable for open forward currency contracts........
-- -- 14,938
Receivable for investment securities sold.............
10,829,363 19,865,046 1,473,752
Dividends and interest receivable.....................
4,017,526 776,763 64,928
Receivable from VBDS (Note 2).........................
-- -- 7,902
Unamortized organization costs (Note 1)...............
23,996 23,996 24,923
Other assets..........................................
-- 26,895 472
- -------------- -------------- -----------
Total Assets........................................
1,855,461,392 1,030,209,979 34,479,565
- -------------- -------------- -----------
LIABILITIES:
Payable to Custodian..................................
-- -- 43,628
Payable for investment securities purchased...........
-- 10,213,300 --
Accrued liabilities:
Advisory fees (Note 2)..............................
638,362 348,151 --
Administration fees (Note 2)........................
79,795 43,520 --
Organization costs payable..........................
40,000 40,000 --
Other accrued expenses..............................
110,092 139,289 61,609
Variation margin payable on futures contracts.........
427,500 -- --
Payable for open forward currency contracts...........
-- -- 5,002
- -------------- -------------- -----------
Total Liabilities...................................
1,295,749 10,784,260 110,239
- -------------- -------------- -----------
NET ASSETS APPLICABLE TO INVESTORS' BENEFICIAL
INTERESTS.............................................
$1,854,165,643 $1,019,425,719 $ 34,369,326
============== ============== ===========
Cost of Investments.....................................
$1,626,635,055 $ 903,564,483 $ 29,142,373
============== ============== ===========
See notes to financial
statements.<FN>
<PAGE>
Statement of Operations
For the Year Ended October 31, 1995
<CAPTION>--------------------------------------------------
- ----------------------------
International
Growth & Income Capital Growth Equity
Portfolio Portfolio Portfolio
- ---------------- -------------- -------------
INVESTMENT INCOME (Note 1):
Interest..............................................
$ 26,372,528 $ 7,285,147 $ 119,763
Dividends.............................................
30,917,914 11,074,210 725,167
Foreign taxes withheld................................
(121,509) (3,018) (117,243)
----------- ----------- -----------
Total investment income...........................
57,168,933 18,356,339 727,687
----------- ----------- -----------
EXPENSES:
Advisory fees (Note 2)................................
6,815,197 3,563,194 431,019
Administration fees (Note 2)..........................
851,900 445,399 21,632
Accounting fees.......................................
83,003 81,003 74,151
Custodian fees (Note 2)...............................
134,266 103,147 64,251
Professional fees.....................................
70,000 68,769 64,275
Trustee fees..........................................
8,000 8,001 2,001
Miscellaneous expense.................................
37,503 44,465 24,999
Amortization of organization costs (Note 1)...........
7,990 7,990 11,516
----------- ----------- -----------
Total expenses....................................
8,007,859 4,321,968 693,844
----------- ----------- -----------
Less fees waived by the Advisor and Administrator (Note
2)....................................................
-- -- 297,934
----------- ----------- -----------
Net Expenses........................................
8,007,859 4,321,968 395,910
----------- ----------- -----------
Net investment income.................................
49,161,074 14,034,371 331,777
----------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments...........................................
79,876,783 38,313,408 (2,936,445)
Futures transactions..................................
15,400,050 -- --
Foreign currency transactions.........................
56 -- 152,966
----------- ----------- -----------
Net realized gain (loss)............................
95,276,889 38,313,408 (2,783,479)
----------- ----------- -----------
Change in net unrealized appreciation (depreciation) on:
Investments...........................................
153,073,852 83,513,979 1,410,173
Futures contracts.....................................
1,767,626 -- --
Foreign currency contracts and foreign currency
translations........................................
-- -- (23,821)
----------- ----------- -----------
Change in net unrealized appreciation
(depreciation).................................
154,841,478 83,513,979 1,386,352
----------- ----------- -----------
Net realized and unrealized gain (loss).................
250,118,367 121,827,387 (1,397,127)
----------- ----------- -----------
Net increase (decrease) in net assets resulting from
operations............................................
$299,279,441 $ 135,861,758 ($ 1,065,350)
=========== =========== ===========
See notes to financial
statements.<FN>
<PAGE>
Statement of Changes in Net Assets For the Periods
Indicated
- -----------------------------------------------------------
- -------------------
<C> <C>
Growth & Income
Capital Growth International
Equity
Portfolio
Portfolio Portfolio
- -------------------------------
- -------------------------------
- -----------------------------
Year
11/29/93* Year 11/29/93* Year
Year
ended through
ended through ended
ended
10/31/95
10/31/94 10/31/95 10/31/94 10/31/95
10/31/94
--------------
- -------------- -------------- --------------
- ------------- -------------
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income......... $ 49,161,074 $
30,288,120 $ 14,034,371 $ 5,544,732 $
331,777 $ 228,285
Net realized gain (loss) on
investments and foreign
currency.................... 95,276,889
(4,034,603) 38,313,408 14,244,098
(2,783,479) 914,084
Change in net unrealized
appreciation on investments,
futures and foreign currency
translations................ 154,841,478
9,175,252 83,513,979 4,750,804 1,386,352
397,695
--------------
- -------------- -------------- --------------
- ------------- -------------
Increase (decrease) in net
assets resulting from
operations................ 299,279,441
35,428,769 135,861,758 24,539,634
(1,065,350) 1,540,064
--------------
- -------------- -------------- --------------
- ------------- -------------
TRANSACTIONS IN INVESTORS'
BENEFICIAL INTERESTS:
Contributions................. 511,820,403
1,858,407,526 1,403,653,138 1,071,735,107
27,092,056 61,709,664
Withdrawals................... (542,453,501)
(308,316,995) (1,217,251,104) (399,112,814)
(47,239,948) (30,833,170)
--------------
- -------------- -------------- --------------
- ------------- -------------
Net increase (decrease) from
transactions in investors'
beneficial interests.......... (30,633,098)
1,550,090,531 186,402,034 672,622,293
(20,147,892) 30,876,494
--------------
- -------------- -------------- --------------
- ------------- -------------
Net increase (decrease) in
net assets................ 268,646,343
1,585,519,300 322,263,792 697,161,927
(21,213,242) 32,416,558
NET ASSETS:
Beginning of period........... 1,585,519,300 --
697,161,927 -- 55,582,568
23,166,010
--------------
- -------------- -------------- --------------
- ------------- -------------
End of period................. $1,854,165,643
$1,585,519,300 $1,019,425,719 $ 697,161,927 $
34,369,326 $ 55,582,568
=================
================= ================= =================
=============== ===============
- ---------------
* Commencement of operations.
See notes to financial
statements.<FN>
<PAGE>
Notes to Financial Statements October 31, 1995
- -----------------------------------------------------------
- -------------------
1. Organization and Significant Accounting Policies --
Growth and Income
Portfolio ("GIP"), Capital Growth Portfolio ("CGP") and
International Equity
Portfolio ("IEP") (the "Portfolios") are separately
registered under the
Investment Company Act of 1940, as amended, as
non-diversified, open end
management investment companies organized as trusts under
the laws of the
State of New York. Each declaration of trust permits the
Trustees to issue
beneficial interests in the respective Portfolios. The GIP
and CGP Portfolios
commenced operations on November 29, 1993 and the IEP
commenced operations on
December 31, 1992.
Effective October 16, 1995, the offshore partner,
International Equity Fund,
withdrew its partnership interests from the International
Equity Portfolio in
the form of cash. The partnership interest of the offshore
fund declined from
19% at the beginning of the year to 1% at the time of
transfer.
The following is a summary of significant accounting
policies followed by
the Portfolios:
A. Valuation of Investments -- Equity securities,
purchased options and
futures are valued at the last sale price on the
exchange on which they
are primarily traded, including the NASDAQ National
Market. Securities
for which sale prices are not available and other
over-the-counter
securities are valued at the last quoted bid price.
Bonds and other fixed
income securities (other than short-term obligations),
including listed
issues, are valued on the basis of valuations
furnished by a pricing
service. In making such valuations, the pricing
service utilizes both
dealer-supplied valuations and electronic data
processing techniques that
take into account appropriate factors such as
institutional-sized trading
in similar groups of securities, yield, quality,
coupon rate, maturity,
type of issue, trading characteristics and other
market data, without
exclusive reliance upon quoted prices. Short-term
obligations are valued
at amortized cost if acquired with fewer than 61 days
to maturity, or at
value based on quoted exchange or over-the-counter
prices, until the 61st
day prior to maturity and thereafter by amortizing the
value on the 61st
day to par at maturity. Portfolio securities for which
there are no such
quotations or valuations are valued at fair value as
determined in good
faith by or at the direction of the Trustees.
B. Security Transactions and Investment Income --
Investment
transactions are accounted for on the trade date (the
date the order to
buy or sell is executed). Securities gains and losses
are calculated on
the identified cost basis. Interest income is accrued
as earned. Dividend
income is recorded on the ex-dividend date.
C. Repurchase agreements -- It is the Trusts' policy
that repurchase
agreements are fully collateralized by U.S. Treasury
and Government
agency securities. All collateral is held by the
Trust's custodian bank,
sub-custodian or a bank with which the custodian bank
has entered into a
sub-custodian agreement or is segregated in the
Federal Reserve Book
Entry System. In connection with transactions in
repurchase agreements,
if the seller defaults and the value of the collateral
declines, or if
the seller enters into an insolvency proceeding,
realization of the
collateral by the Trust may be delayed or limited.
D. Futures contracts -- When a portfolio enters into
a futures
contract, it makes an initial margin deposit in a
segregated account,
either in cash or liquid securities. Thereafter, the
deposit is marked to
market based upon changes in the value of the futures
contract and the
portfolio makes (or receives) additional cash payments
daily to the
broker. Changes in the value of the contract are
recorded as unrealized
appreciation/depreciation until the contract is closed
or settled.
<PAGE>
Notes to Financial Statements October 31, 1995 (continued)
- -----------------------------------------------------------
- -------------------
The Growth and Income Portfolio invested a portion of
its liquid assets
in long stock index futures contracts to more fully
participate in the
market. Use of futures contracts subject the Portfolio
to risk of loss in
excess of amounts shown on the Statement of Assets and
Liabilities, up to
the amount of the value of the contract.
The Portfolio may enter into futures contracts only on
exchanges or
boards of trade. The exchange or board of trade acts
as the counterparty
to each futures transaction, therefore, the
Portfolio's credit risk is
limited to failure of the exchange or board of trade.
E. Foreign Currency Translations -- The books and
records of the
Portfolios are maintained in U.S. dollars. Foreign
currency amounts are
translated into U.S. dollars at the official exchange
rates, or at the
mean of the current bid and asked prices, of such
currencies against the
U.S. dollar as quoted by a major bank, on the
following basis:
(a) Market value of investment securities and other
assets and
liabilities: at the closing rate of exchange at the
balance sheet date.
(b) Purchases and sales of investment securities,
income and expenses:
at the rates of exchange prevailing on the respective
dates of such
transactions.
Although the net assets of the Portfolio are presented
at the foreign
exchange rates and market values at the close of the
year, the Portfolio
does not isolate that portion of the results of
operations arising as a
result of changes in the foreign exchange rates from
the fluctuations
arising from changes in the market prices of the
securities held at year
end. Similarly, the Portfolio does not isolate the
effect of changes in
foreign exchange rates from the fluctuations arising
from changes in the
market prices of securities sold during the year.
Accordingly, realized
foreign currency gains (losses) are included in the
reported net realized
losses on security transactions.
Reported realized foreign exchange gains or losses
arise from disposition
of foreign currency, currency gains or losses realized
between the trade
and settlement dates on securities transactions, and
the difference
between the amounts of dividends, interest, and
foreign withholding taxes
recorded on the Portfolios' books on the transaction
date and the U.S.
dollar equivalent of the amounts actually received or
paid. Unrealized
foreign exchange gains and losses arise from changes
(due to the changes
in the exchange rate) in the value of foreign currency
and other assets
and liabilities denominated in foreign currencies
which are held at
period end.
G. Forward Foreign Currency Exchange Contracts --
The portfolios may
enter into forward foreign currency contracts
(obligations to purchase or
sell foreign currency in the future on a date and
price fixed at the time
the contracts are entered into) to hedge the portfolio
against
fluctuations in the value of its assets or liabilities
due to change in
the value of foreign currencies. Each day the forward
contract is open,
changes in the value of the contract are recognized as
unrealized gains
or losses by "marking to market". When the forward
contract is closed, or
the delivery of the currency is made or taken, the
portfolio records a
realized gain or loss equal to the difference between
the proceeds from
(or cost of) the closing transaction and the
portfolio's basis in the
contract. The portfolios are subject to off-balance
sheet risk to the
extent of the value of the contracts for purchases of
currency, and in an
unlimited amount for sales of currency.
<PAGE>
Notes to Financial Statements October 31, 1995 (continued)
- -----------------------------------------------------------
- -------------------
H. Federal Income Taxes and Distributions to
Investors -- The
Portfolios intend to qualify as partnerships and
therefore net income and
net realized gains are taxed to the partners. The
investors in the
Portfolios must take into account their proportionate
share of the
Portfolios' income, gains, losses, deductions, credits
and tax preference
items in computing their federal income tax liability,
without regard to
whether they have received any cash distributions from
the Portfolio. The
Portfolios do not intend to distribute to investors
their net investment
income or their net realized gains, if any. It is
intended that the
Portfolios will be managed in such a way that
investors in the portfolio
will be able to satisfy the requirements of subchapter
M of the Internal
Revenue Code to be taxed as regulated investment
companies.
I. Organization Costs -- Organization and initial
registration costs
incurred in connection with establishing each of the
Portfolios have been
deferred and are being amortized on a straight-line
basis over a
sixty-month period beginning with the commencement of
operations of each
Portfolio.
2. Fees and Other Transactions with Affiliates
A. Investment Advisory Fees -- The Chase Manhattan
Bank, N.A.
("Chase"), a direct wholly-owned subsidiary of The
Chase Manhattan
Corporation, is the Portfolios' investment adviser
(the "Adviser") and
custodian (the "Custodian"). The Adviser manages the
assets of the
Portfolios pursuant to an Advisory Agreement, and for
such services, is
paid an annual fee computed daily and paid monthly
based on an annual
rate equal to .40% of the GIP's and CGP's average
daily net assets and
1.00% of the IEP's average daily net assets. The
Adviser voluntarily
waived all or a portion of its fees as outlined in
Note 2.D. below.
B. Custodial Fees -- Chase, as Custodian, provides
safekeeping services
for the Portfolios' securities. Compensation for such
services are
presented in the Statement of Operations as custodian
fees.
C. Administration Fee -- Pursuant to an
Administration Agreement,
effective October 16, 1995, Chase ("the
Administrator"), and prior
thereto The Chase Manhattan Trust Corporation Limited,
provides certain
administration services to the Portfolios. For these
services, the
Administrator, and the predecessor administrator,
receives from each
Portfolio a fee computed at an annual rate equal to
0.05% of the
respective Portfolio's average daily net assets. The
Administrator and
its predecessor voluntarily waived all or a portion of
its fees as
outlined in Note 2D below.
D. Waivers of fees -- For the year ended October 31,
1995, the Adviser
and Administrator (including the predecessor) of IEP
voluntarily waived
fees to which they were entitled of $276,302 and
$21,632, respectively.
E. Other -- The Portfolios' organizational costs
payable are comprised
of liabilities owed to the Funds' Distributor, Vista
Broker Dealer
Services (VBDS).
On August 27, 1995, the Chase Manhattan Corporation
and Chemical Banking
Corporation announced an agreement in principle to
merge, which was
approved by shareholders of both corporations on
December 11, 1995,
subject to the approval of regulators.
<PAGE>
Notes to Financial Statements October 31, 1995 (continued)
- -----------------------------------------------------------
- -------------------
3. Investment Transactions
Purchases and sales of investments (excluding short-term
investments) for the
year ended October 31, 1995, were as follows:
GIP CGP IEP
- -------------- ------------- ------------
Purchases (excluding U.S. Government)...................
$1,097,535,211 $ 855,989,009 $ 53,287,404
Sales (excluding U.S. Government).......................
899,470,573 673,232,243 67,431,260
Purchases of U.S. Government............................
19,583,924 -- --
Sales of U.S. Government................................
113,064,899 -- --
The portfolio turnover rates of GIP, CGP and IEP Portfolios
for this period
were 71%, 86% and 137%, respectively.
4. Open Forward Foreign Currency Contracts
International Equity Portfolio
Net
Unrealized
Delivery
Market Gain
Value (Local
Cost Settlement Value (Loss)
Sales Currency)
(USD) Date (USD) (USD)
- ------------------------------------- ------------
- ----------- ---------- -----------
- ----------
Italian Lira......................... 965,910,000
$600,000 11/22/95 $604,315
($4,315)
Japanese Yen......................... 35,000,000
342,801 11/02/95 342,425
376
Japanese Yen......................... 35,000,000
342,801 11/02/95 342,425
376
Japanese Yen......................... 70,000,000
686,275 11/02/95 684,650
1,625
Japanese Yen......................... 39,000,000
381,792 11/17/95 382,479
(687)
Japanese Yen......................... 178,000,000
1,758,198 11/30/95 1,749,196
9,002
Japanese Yen......................... 103,000,000
1,015,809 11/30/95 1,012,250
3,559
- ----------- -----------
- ----------
Total Sales..........................
$5,127,676 $5,117,740
$9,936
========== ==========
=========
5. Foreign Cash Positions
International Equity Portfolio
Net Unrealized
Local
Cost Market Value Gain (Loss)
Currency Value
(USD) (USD) (USD)
- ------------------------------------------------
- ----------- --------- ------------ --------------
Australian Dollar...............................
3,684 $ 2,788 $ 2,806 $18
German Deutsche Mark............................
441,079 313,535 313,524 (11)
Great British Pound.............................
88,003 139,125 139,125 0
Japanese Yen....................................
30,899,255 306,545 302,208 (4,337)
--------- ------------ --------------
$ 761,993 $757,663 ($4,330)
======== =========== ============
</TABLE>
<TABLE>
Growth and Income Portfolio
Portfolio of Investments October 31, 1995
- -<CAPTION>-------------------------------------------------
- ---------------------- ------
<C> <C>
<C>
Issuer Shares
Value
- ------<S>----------------------------- ------------
- --------------
LONG-TERM INVESTMENTS -- 86.4%
COMMON STOCK -- 73.3%
Aerospace -- 1.9%
General Motors Class H............. 300,000 $
12,600,000
Loral Corp. ....................... 320,000
9,480,000
United Technologies, Corp. ........ 150,000
13,312,500
- --------------
35,392,500
- --------------
Agricultural Production/
Services -- 1.7%
AGCO Corp. ........................ 175,000
7,831,250
Case Corp. ........................ 375,000
14,296,875
Deere & Co. ....................... 100,000
8,937,500
- --------------
31,065,625
- --------------
Apparel/Textiles -- 0.2%
V.F. Corp. ........................ 75,000
3,590,625
- --------------
Automotive -- 2.6%
Chrysler Corp. .................... 214,027
11,049,144
Dana Corp. ........................ 300,000
7,687,500
Echlin, Inc. ...................... 400,000
14,300,000
General Motors..................... 200,000
8,750,000
TRW Inc. .......................... 100,000
6,575,000
- --------------
48,361,644
- --------------
Banking -- 3.3%
Bank of New York Company, Inc. .... 375,000
15,750,000
Citicorp........................... 265,000
17,191,875
First Bank System Inc. ............ 150,000
7,462,500
NationsBank Corp. ................. 125,000
8,218,750
Norwest Corp. ..................... 415,000
12,242,500
- --------------
60,865,625
- --------------
Chemicals -- 2.7%
Air Products & Chemicals, Inc. .... 200,000
10,325,000
Dow Chemical Co. .................. 90,000
6,176,250
duPont (EI) deNemours.............. 300,000
18,712,500
Praxair, Inc. ..................... 225,000
6,075,000
Union Carbide Corp. ............... 235,000
8,900,625
- --------------
50,189,375
- --------------
Computer Software -- 1.5%
Computer Associates
International..................... 200,000
11,000,000
General Motors Corp., Class E...... 200,000
9,425,000
Reynolds & Reynolds, Inc., Class
A................................. 223,000
7,944,375
- --------------
28,369,375
- --------------
Computers/Computer Hardware -- 4.1%
Apple Computer Inc. ............... 210,000
7,625,625
Comdisco, Inc. .................... 180,000
5,490,000
Compaq Computer*................... 400,000
22,300,000
International Business Machines
Corp. ............................ 75,000
7,293,750
Read-Rite Corp. ................... 250,000
8,718,750
SCI Systems, Inc.*................. 200,000
7,025,000
Sun Microsystems, Inc.*............ 225,000
17,550,000
- --------------
76,003,125
- --------------
Issuer Shares
Value
- ----------------------------------- ------------
- --------------
Construction Machinery -- 0.8%
Caterpillar Inc. .................. 250,000 $
14,031,250
- --------------
Consumer Products -- 1.7%
Black & Decker Corp. .............. 300,000
10,162,500
Procter & Gamble Co. .............. 100,000
8,100,000
Shaw Industries.................... 195,000
2,486,250
Toro Co. .......................... 120,000
3,465,000
Whirlpool Corp. ................... 130,000
6,890,000
- --------------
31,103,750
- --------------
Diversified -- 0.7%
Textron, Inc. ..................... 200,000
13,750,000
- --------------
Electronics/Electrical
Equipment -- 1.9%
Analog Devices Inc. ............... 200,000
7,225,000
Texas Instruments.................. 250,198
17,076,014
Xilinx, Inc.*...................... 225,000
10,350,000
- --------------
34,651,014
- --------------
Electronics Distributor -- 0.4%
Arrow Electronics, Inc.*........... 150,000
7,612,500
- --------------
Entertainment -- 0.6%
Trump Hotels & Casino Resorts,
Inc. ............................. 325,000
5,525,000
Viacom, Inc. Class B*.............. 125,763
6,288,150
- --------------
11,813,150
- --------------
Environmental Services -- 0.4%
Browning-Ferris Industries,
Inc. ............................. 250,000
7,281,250
- --------------
Financial Services -- 2.7%
Advanta Corp., Class A............. 100,000
3,875,000
American Express Co. .............. 200,000
8,125,000
American General Delaware.......... 450,000
14,793,750
Dean Witter, Discover & Co. ....... 207,806
10,338,349
Federal National Mortgage
Assoc. ........................... 130,000
13,633,750
- --------------
50,765,849
- --------------
Food/Beverage Products -- 4.1%
Coca-Cola Enterprises, Inc. ....... 400,000
10,650,000
ConAgra, Inc. ..................... 225,000
8,690,625
CPC International, Inc.*........... 100,000
6,637,500
IBP, Inc. ......................... 140,000
8,382,500
PepsiCo., Inc. .................... 250,000
13,187,500
Philip Morris Companies, Inc. ..... 175,000
14,787,500
RJR Nabisco Holdings Corp. ........ 250,000
7,687,500
Seagram Company, Ltd. ............. 200,000
7,200,000
- --------------
77,223,125
- --------------
Health Care -- 2.6%
Baxter International Inc. ......... 400,000
15,450,000
Columbia/HCA Healthcare Corp. ..... 235,000
11,544,375
FHP International Corp.*........... 200,000
4,850,000
Humana, Inc.*...................... 225,000
4,753,125
Manor Care, Inc. .................. 125,000
4,093,750
Tenet Healthcare Corp.*............ 415,000
7,418,125
- --------------
48,109,375
- --------------
See notes to financial
statements.<FN>
<PAGE>
</TABLE>
<TABLE>
Growth and Income Portfolio
Portfolio of Investments October 31, 1995 (continued)
<caption---------------------------------------------------
- ---------------------------
<C> <C> <C>
Issuer Shares
Value
- ---<S>-------------------------------- ------------
- --------------
Insurance -- 4.1%
Allstate Corp. .................... 278,110 $
10,220,543
American International Group....... 142,500
12,023,438
Chubb Corp. ....................... 150,000
13,481,250
Mid Ocean, Ltd.*................... 170,000
6,013,750
Reliastar Financial Corp. ......... 140,000
5,845,000
St. Paul Companies, Inc. .......... 200,000
10,150,000
Transamerica Corp. ................ 150,000
10,162,500
Transport Holdings, Inc., Class
A*................................ 750
29,437
Travelers, Inc. ................... 150,000
7,575,000
- --------------
75,500,918
- --------------
Manufacturing -- 2.3%
Eaton Corp. ....................... 150,000
7,687,500
Johnson Controls................... 275,000
16,018,750
Kennametal Inc. ................... 175,000
5,446,875
Varity Corp.*...................... 400,000
14,500,000
- --------------
43,653,125
- --------------
Metals/Mining -- 1.6%
Aluminum Co. of America (ALCOA).... 200,000
10,200,000
Inco, Ltd. ........................ 375,000
12,890,625
Phelps Dodge Corp. ................ 100,000
6,337,500
- --------------
29,428,125
- --------------
Office/Business Equipment -- 0.4%
Xerox Corp. ....................... 55,000
7,136,250
- --------------
Oil & Gas -- 6.2%
Amoco Corp. ....................... 150,000
9,581,250
Ashland Inc. ...................... 250,000
7,906,250
Halliburton Company................ 449,000
18,633,500
Mobil Corp. ....................... 125,000
12,593,750
Panhandle Eastern Corp. ........... 650,000
16,412,500
Phillips Petroleum Co. ............ 355,000
11,448,750
Smith International*............... 194,200
3,107,200
Triton Energy Corp. ............... 250,000
11,656,250
Ultramar Corp. .................... 200,000
4,875,000
Unocal Corp. ...................... 250,000
6,562,500
Williams Companies, Inc. .......... 300,000
11,587,500
- --------------
114,364,450
- --------------
Paper/Forest Products -- 3.1%
Boise Cascade Corp. ............... 150,000
5,437,500
Champion International Corp. ...... 370,000
19,795,000
Fort Howard Corp.*................. 400,000
6,700,000
Mead Corp. ........................ 170,000
9,796,250
Willamette Industries.............. 261,000
15,138,000
- --------------
56,866,750
- --------------
Pharmaceuticals -- 2.4%
Allergan Inc. ..................... 150,000
4,406,250
American Home Products Corp. ...... 100,000
8,862,500
Glaxo Wellcome Plc................. 300,000
8,137,500
Schering-Plough Corp. ............. 250,000
13,406,250
Smithkline Beecham Plc, ADR........ 175,000
9,078,125
- --------------
43,890,625
- --------------
Issuer Shares
Value
- ----------------------------------- ------------
- --------------
Printing & Publishing -- 1.1%
Harcourt General, Inc. ............ 200,000 $
7,925,000
The News Corporation, Ltd, ADR..... 300,000
5,962,500
Tribune Co. ....................... 125,000
7,890,625
- --------------
21,778,125
- --------------
Real Estate Investment
Trust -- 0.3%
Hospitality Properties Trust....... 181,000
4,751,250
- --------------
Restaurants/Food Services -- 0.3%
Wendy's International, Inc. ....... 325,000
6,459,375
- --------------
Retailing -- 5.0%
American Stores Co. ............... 485,000
14,489,375
Circuit City Stores, Inc. ......... 420,000
14,017,500
Dayton-Hudson Corp. ............... 250,000
17,187,500
Kroger Co.*........................ 654,000
21,827,250
May Department Stores.............. 400,000
15,700,000
Sears Roebuck & Co. ............... 300,000
10,200,000
- --------------
93,421,625
- --------------
Shipping/Transportation -- 3.3%
Burlington Northern, Inc. ......... 100,000
8,387,500
Consolidated Railway, Inc. ........ 200,000
13,750,000
CSX Corp. ......................... 200,000
16,750,000
Federal Express Corp.*............. 100,000
8,212,500
Ryder System....................... 300,000
7,237,500
XTRA Corp. ........................ 155,000
6,800,625
- --------------
61,138,125
- --------------
Steel -- 0.8%
LTV Corp.*......................... 300,000
4,200,000
USX-US Steel Group, Inc. .......... 340,000
10,157,500
- --------------
14,357,500
- --------------
Telecommunications -- 3.4%
AT&T Corp. ........................ 225,000
14,400,000
Frontier Corp. .................... 200,000
5,400,000
GTE Corp. ......................... 400,000
16,500,000
Sprint Corp. ...................... 275,000
10,587,500
Tele-Communications, Class A*...... 350,000
5,950,000
U S West, Inc. .................... 200,000
9,525,000
- --------------
62,362,500
- --------------
Toys & Games -- 0.4%
Mattel, Inc. ...................... 250,000
7,187,500
- --------------
Utilities -- 4.7%
CINergy Corp. ..................... 200,000
5,675,000
CMS Energy Corp. .................. 375,000
10,359,375
Eastern Utilities Associates....... 200,000
4,700,000
FPL Group Inc. .................... 285,000
11,934,375
General Public Utilities........... 300,000
9,375,000
Nipsco Industries Inc. ............ 205,000
7,482,500
Oklahoma Gas & Electric Co. ....... 150,000
6,000,000
PECO Energy Co. ................... 259,100
7,578,675
Pinnacle West Capital Corp. ....... 700,000
19,250,000
Public Service Co. of Colorado..... 115,000
3,924,375
- --------------
86,279,300
- --------------
See notes to financial statements.
<FN>
<PAGE>
</TABLE>
<TABLE>
Growth and Income Portfolio
Portfolio of Investments October 31, 1995 (continued)
- -<CAPTION>-------------------------------------------------
- ----------------------------
<C> <C> <C>
Issuer Shares
Value
- -----<S>------------------------------ ------------
- --------------
TOTAL COMMON STOCK
(Cost $1,168,160,359).............
$1,358,754,700
- --------------
CONVERTIBLE PREFERRED STOCK -- 5.0%
Airlines --
Delta Airlines, Ser. C, $3.50...... 150,000
8,306,250
- --------------
Automotive --
Ford Motor Co., Ser. A, 8.4%....... 80,000
7,520,000
- --------------
Computers/Computer Hardware --
Ceridian Corp., 5.5%............... 120,000
11,700,000
- --------------
Entertainment --
Time Warner Financing Trust,
$1.24............................. 200,000
6,400,000
- --------------
Electronics/Electrical
Equipment --
Westinghouse Electric, Ser. C,
$1.30............................. 800,000
10,981,600
- --------------
Environmental Services --
Browning-Ferris, Inc., 7.25%....... 88,000
2,893,000
- --------------
Financial Services --
American General Delaware, Ser. A,
$3.00............................. 118,000
6,106,500
- --------------
Food/Beverage Products --
RJR Nabisco Holdings Corp., Ser. C,
$0.6012........................... 700,000
4,375,000
- --------------
Health Care --
FHP International Corp., Ser. A,
5.0%.............................. 225,000
5,343,750
- --------------
Oil & Gas --
Diamond Shamrock, 5.0%#............ 120,000
6,540,000
Occidental Petroleum, $3.00........ 140,000
7,910,000
- --------------
14,450,000
- --------------
Paper/Forest Products --
International Paper Capital Corp.#
5.25%............................. 200,000
8,783,800
- --------------
Printing & Publishing --
The News Corporation ADR, $.11..... 200,000
3,650,000
- --------------
Steel --
WHX Corp., Ser. B, $3.75........... 48,500
2,037,000
- --------------
TOTAL CONVERTIBLE PREFERRED STOCK
(Cost $82,938,090)...............
92,546,900
- --------------
Principal
Issuer Amount (USD)
Value
- ----------------------------------- ------------
- --------------
FLOATING RATE NOTES -- 1.3%
Financial Services --
Goldman Sachs#,
5.85% @, due 7/1/96
(Cost $25,000,000)................ $ 25,000,000 $
24,812,500
- --------------
CONVERTIBLE CORPORATE NOTES AND BONDS -- 5.9%
Airlines --
AMR, Corp., 6.125%, due 11/1/24.... 10,000,000
9,623,400
- --------------
Automotive --
Magna International Inc.,
5.0%, due 10/15/02................ 4,500,000
4,584,375
- --------------
Computer Software --
Softkey International Inc.#,
5.5%, due 11/1/00................. 7,000,000
5,929,280
- --------------
Consumer Products --
Grand Metropoliton Placing#,
6.5%, due 1/31/00................. 2,850,000
3,216,367
- --------------
Electronics/Electrical
Equipment --
National Semiconductor,
6.5%, due 10/1/02................. 10,000,000
9,591,500
Sanmina Corp.#, 5.5%, due 8/15/02.. 2,000,000
2,224,440
- --------------
11,815,940
- --------------
Financial Services --
First Financial Management,
5%, due 12/15/99.................. 5,000,000
7,687,250
MBL International Finance Bermuda,
3%, due 11/30/02.................. 5,000,000
5,222,500
South African Pulp & Paper
Industries, BVI Finance Ltd, 7.5%,
due 8/1/02........................ 6,600,000
6,814,500
- --------------
19,724,250
- --------------
Insurance --
Aegon NV#, 4.75%, due 11/1/04...... 8,500,000
11,177,500
- --------------
Manufacturing --
3 Com Corp.#, 10.25%, due 11/1/01.. 6,750,000
11,036,992
Coeur D'Alene Mines Corp.,
6.0%, due 6/10/02................. 3,000,000
2,677,500
ICN Pharmaceutical,
8.5%, due 11/15/99................ 5,000,000
5,577,800
Waban Inc., 6.5%, due 7/1/02....... 3,000,000
2,797,500
- --------------
22,089,792
- --------------
Oil & Gas --
Apache Corp.#, 6%, due 1/15/02..... 5,000,000
5,381,350
- --------------
Pharmaceuticals --
Ciba-Geigy AG#,
6.25%, due 3/15/16................ 3,000,000
3,015,000
- --------------
See notes to financial
statements.<FN>
<PAGE>
</TABLE>
<TABLE>
Growth and Income Portfolio
Portfolio of Investments October 31, 1995 (continued)
- -<CAPTION>-------------------------------------------------
- ----------------------------
<C> <C> <C>
Principal
Issuer Amount
Value
- -------<S>---------------------------- ------------
- --------------
Printing & Publishing --
Time Warner, Inc.,
8.75%, due 1/10/15................ $ 8,349,550 $
8,714,843
- --------------
Retailing --
Federated Department Stores,
5%, due 10/1/03................... 4,000,000
3,866,760
- --------------
TOTAL CONVERTIBLE CORPORATE NOTES
AND BONDS
(Cost $97,167,708)...............
109,138,857
- --------------
U.S. GOVERNMENT OBLIGATIONS -- 0.9%
U.S. Treasury Bond,
9.25%, due 02/15/16
(Cost $14,430,500)............... 12,400,000
16,399,000
- --------------
TOTAL LONG-TERM INVESTMENTS
(Cost $1,387,696,657).............
1,601,651,957
- --------------
SHORT-TERM INVESTMENTS -- 12.9%
U.S. GOVERNMENT OBLIGATIONS -- 0.2%
U.S. Treasury Bill, due 11/24/95@@
(Cost $3,189,011)................ 3,200,000
3,189,011
- --------------
U.S. GOVERNMENT AGENCY SPONSORED
OBLIGATIONS -- 1.9%
Federal National Mortgage
Association, 5.5%, due 11/29/95
(Cost $34,850,005)............... 35,000,000
34,850,005
- --------------
Principal
Issuer Amount
Value
- ----------------------------------- ------------
- --------------
COMMERCIAL PAPER -- 10.8%
Chemicals --
duPont (El) deNemours,
5.71%, due 11/2/95............... $ 35,000,000 $
34,994,449
- --------------
Financial Services --
Federal Home Loan Bank,
5.64%, due 11/2/95................ 20,000,000
19,996,867
Household Finance Corp.,
5.8%, due 11/1/95 ................ 41,042,000
41,042,000
JP Morgan, 5.72%, due 11/9/95...... 35,000,000
34,955,511
Receivables Capital Corp.#,
5.75%, due 11/15/95............... 35,000,000
34,921,736
Svenska Handelsbanken,
5.75%, due 11/3/95................ 35,000,000
34,988,819
- --------------
165,904,933
- --------------
TOTAL COMMERCIAL PAPER
(Cost $200,899,382)..............
200,899,382
- --------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $238,938,398)..............
238,938,398
- --------------
TOTAL INVESTMENTS --
(Cost $1,626,635,055)............ 99.3%
$1,840,590,355
=================
- ---------------
@ = Rate shown is the rate in effect at 10/31/95.
* = Non income producing security.
# = Security may only be sold to qualified
institutional
investors.
@@ = This security is pledged to cover financial
futures
contracts.
Purchased Index Futures Outstanding
Expiration Number of Nominal Value Unrealized
Description (A)
Date Contracts at 10/31/95
Appreciation
- -----------------------------------------------------------
----------- ------------ --------------
- ------------
S & P 500 Futures..........................................
Dec 95 300 $ 87,577,500 $1,362,579
- ---------------
(A) = One contract equals 500 shares.
See notes to financial statements.
<FN>
<PAGE>
</TABLE>
<TABLE>
Capital Growth Portfolio
Portfolio of Investments October 31, 1995
<CAPTION>--------------------------------------------------
- ----------------------------
<C> <C>
<C>
Issuer Shares
Value
- ---------<S>-------------------------- ------------
- --------------
LONG-TERM INVESTMENTS -- 88.6%
COMMON STOCK -- 86.3%
Agricultural Products/
Services -- 5.0%
AGCO Corp. ........................ 435,000 $
19,466,250
Agrium, Inc. ...................... 60,000
2,460,000
Case Corp. ........................ 153,500
5,852,188
IMC Global, Inc. .................. 100,000
7,000,000
Mississippi Chemical............... 200,000
4,825,000
Terra Industries, Inc. ............ 500,000
6,312,500
Vigoro Corp. ...................... 110,000
4,771,250
- ------------
50,687,188
- ------------
Automotive -- 2.0%
Echlin, Inc. ...................... 115,000
4,111,250
Lear Seating Corp. ................ 160,000
4,440,000
Magna International, Inc. Class
A................................. 100,000
4,325,000
Masland Corp. ..................... 350,000
4,900,000
Strattec Security Corp. ........... 20,000
335,000
Titan Wheel International, Inc. ... 127,500
1,848,750
- ------------
19,960,000
- ------------
Banking -- 4.4%
BayBanks, Inc. .................... 175,000
14,175,000
Dime Bancorp, Inc.*................ 200,000
2,125,000
Midlantic Corp., Inc. ............. 50,000
2,650,000
Standard Federal Bancorporation.... 450,000
15,975,000
Zions Bancorporation............... 150,000
10,387,500
- ------------
45,312,500
- ------------
Broadcasting -- 0.2%
People's Choice TV Corp.*.......... 87,740
1,820,605
- ------------
Business Services -- 0.7%
Equifax, Inc. ..................... 125,000
4,875,000
PHH Corp. ......................... 50,000
2,187,500
- ------------
7,062,500
- ------------
Chemicals -- 0.9%
Hanna (M.A.) Co. .................. 150,000
3,843,750
Material Sciences Corp.*........... 200,000
3,325,000
The Geon Company................... 100,000
2,487,500
- ------------
9,656,250
- ------------
Computer Software -- 3.9%
American Management Systems,
Inc.*............................. 150,000
4,331,250
BMC Software, Inc. ................ 125,000
4,453,125
Computervision Corp.*.............. 300,000
3,525,000
FileNet Corp.*..................... 190,000
8,621,250
Reynolds & Reynolds, Inc., Class
A................................. 500,000
17,812,500
Symantec Corp.*.................... 50,000
1,215,625
- ------------
39,958,750
- ------------
Computers/Computer Hardware -- 4.5%
Comdisco, Inc. .................... 350,000
10,675,000
Cornerstone Imaging, Inc.*......... 60,000
1,350,000
Inference Corp., Class A........... 41,650
505,006
Micros Systems, Inc.*.............. 100,000
3,725,000
Read-Rite Corp. ................... 250,000
8,718,750
SCI Systems, Inc.*................. 400,000
14,050,000
Solectron Corp.*................... 175,000
7,043,750
- ------------
46,067,506
- ------------
Issuer Shares
Value
- ----------------------------------- ------------
- --------------
Construction Materials -- 1.7%
Manville Corp.*.................... 500,000 $
5,812,500
Texas Industries Inc. ............. 100,000
5,262,500
USG Corp. ......................... 200,000
5,825,000
- ------------
16,900,000
- ------------
Consumer Products -- 4.7%
Black & Decker Corp. .............. 250,000
8,468,750
Danaher Corp. ..................... 300,000
9,300,000
First Brands Corp. ................ 100,000
4,575,000
Fleetwood Enterprises, Inc. ....... 250,000
5,125,000
Lancaster Colony Corp. ............ 125,000
4,156,250
Leggett & Platt Inc. .............. 200,000
4,800,000
Toro Co. .......................... 400,000
11,550,000
- ------------
47,975,000
- ------------
Diversified -- 0.4%
Albany International Corp., Class
A................................. 200,000
4,150,000
- ------------
Electronics/Electrical Equipment -- 7.3%
Adaptec, Inc. ..................... 150,000
6,675,000
ADT ltd. .......................... 400,000
5,600,000
AVX Corp. ......................... 125,000
3,890,625
Belden, Inc. ...................... 116,000
2,798,500
Harman International Industries,
Inc. ............................. 105,000
4,843,125
Integrated Device Technology,
Inc.*............................. 275,000
5,225,000
ITI Technologies, Inc.*............ 40,000
1,010,000
Lam Research Corp.*................ 90,000
5,478,750
Linear Technology Corp. ........... 75,000
3,281,250
LTX Corp.* ........................ 200,000
2,475,000
Mentor Graphics Corp. ............. 250,000
5,250,000
Microchip Technology, Inc.*........ 125,000
4,960,937
Tektronix Inc. .................... 100,000
5,925,000
Teradyne Inc.*..................... 130,000
4,338,750
Vishay Intertechnology, Inc. ...... 50,600
1,783,650
Watkins-Johnson.................... 100,000
4,812,500
Xilinx, Inc.*...................... 125,000
5,750,000
- ------------
74,098,087
- ------------
Electronics Distributors -- 1.5%
Arrow Electronics, Inc.*........... 137,800
6,993,350
Marshall Industries*............... 225,000
7,931,250
- ------------
14,924,600
- ------------
Entertainment -- 1.1%
Bally Entertainment Corp.*......... 500,000
5,500,000
Integrity Music, Inc., Class A*.... 200,000
475,000
Mirage Resorts, Inc.* ............. 175,000
5,731,250
- ------------
11,706,250
- ------------
Financial Services -- 3.3%
Advanta Corp., Class A............. 200,000
7,750,000
DST Systems, Inc.*................. 174,500
3,664,500
Finova Group, Inc. ................ 100,000
4,525,000
Green Tree Financial Corp. ........ 450,000
11,981,250
National Auto Credit, Inc.*........ 300,000
4,875,000
SEI Corp. ......................... 62,200
1,321,750
- ------------
34,117,500
- ------------
Food/Beverage Products -- 1.6%
IBP, Inc. ......................... 275,000
16,465,625
- ------------
See notes to financial
statements.<FN>
<PAGE>
</TABLE>
<TABLE>
Capital Growth Portfolio
Portfolio of Investments October 31, 1995 (continued)
- -<CAPTION>-------------------------------------------------
- ----------------------------
<C> <C> <C>
Issuer Shares
Value
- ----<S>------------------------------- ------------
- --------------
Health Care -- 4.5%
Apria Healthcare Group, Inc.*...... 60,000 $
1,297,500
Beckman Instruments, Inc. ......... 200,000
6,625,000
Beverly Enterprises................ 350,000
4,112,500
HealthCare COMPARE*................ 175,000
6,475,000
Horizon/CMS Healthcare Corp. ...... 250,000
5,062,500
OrNda Healthcorp*.................. 500,000
8,812,500
Sybron International Corp.*........ 130,000
5,525,000
Universal Health Services, Inc.,
Class B*.......................... 200,000
7,500,000
- ------------
45,410,000
- ------------
Home Building Construction -- 0.6%
Oakwood Homes Corp. ............... 150,000
5,625,000
- ------------
Insurance -- 6.1%
ACE, Ltd. #........................ 170,000
5,780,000
American Re Corp. ................. 150,000
5,737,500
Mid Ocean, Ltd.*................... 175,000
6,190,625
PartnerRe Holdings, Ltd. .......... 50,000
1,331,250
PXRE Corp. ........................ 103,500
2,639,250
Reliance Group Holdings, Inc. ..... 300,000
2,212,500
Reliastar Financial Corp. ......... 325,000
13,568,750
SunAmerica, Inc. .................. 175,000
10,893,750
TIG Holdings Inc. ................. 200,000
5,075,000
Transatlantic Holdings, Inc. ...... 80,000
5,390,000
USF&G Corp. ....................... 200,000
3,350,000
- ------------
62,168,625
- ------------
Machinery & Engineering Equipment -- 0.7%
Blount Inc., Class A............... 75,000
3,253,125
Precision Castparts Corp. ......... 100,000
3,575,000
- ------------
6,828,125
- ------------
Manufacturing -- 5.7%
Duriron, Inc. ..................... 100,000
2,675,000
Elsag Bailey Process Automation
N.V.* ADR......................... 283,000
7,711,750
Furon Co. ......................... 125,000
1,937,500
JLG Industries, Inc. .............. 200,000
4,700,000
Johnson Controls................... 85,000
4,951,250
Kennametal Inc. ................... 385,000
11,983,125
Mark IV Industries................. 200,000
3,900,000
Modine Manufacturing Co. .......... 350,000
9,625,000
NACCO Industries, Inc. Class A..... 100,000
5,725,000
Varity Corp.*...................... 125,000
4,531,250
- ------------
57,739,875
- ------------
Metals/Mining -- 0.8%
Amcast Industrial Corp. ........... 200,000
3,400,000
Cleveland-Cliffs, Inc. ............ 75,000
2,803,125
Commonwealth Aluminum Corp. ....... 125,000
2,015,625
- ------------
8,218,750
- ------------
Oil & Gas -- 4.2%
Diamond Shamrock #................. 200,000
5,150,000
Noble Drilling Corp. .............. 27,097
189,681
Panhandle Eastern Corp. ........... 200,000
5,050,000
Smith International*............... 700,000
11,200,000
Total Petroleum of North America... 500,000
5,062,500
Triton Energy Corp. ............... 110,000
5,128,750
Union Texas Petroleum Holdings..... 225,000
4,050,000
Weatherford Enterra, Inc. ......... 300,000
7,237,500
- ------------
43,068,431
- ------------
Issuer Shares
Value
- ----------------------------------- ------------
- --------------
Paper/Forest Products -- 1.3%
Boise Cascade Corp. ............... 125,000 $
4,531,250
Bowater, Inc. ..................... 100,000
4,425,000
Rayonier, Inc. .................... 125,000
4,687,500
- ------------
13,643,750
- ------------
Printing & Publishing -- 0.4%
Pulitzer Publishing................ 100,000
4,525,000
- ------------
Real Estate Investment
Trust -- 2.8%
Avalon Properties, Inc. ........... 200,000
3,900,000
Bay Apartment Communities, Inc. ... 150,000
3,093,750
Developers Diversified Realty...... 50,000
1,425,000
Evans Withycombe Residential,
Inc. ............................. 150,000
2,831,250
Home Properties of New York,
Inc. ............................. 222,400
3,753,000
Liberty Property Trust............. 200,000
4,050,000
Oasis Residential, Inc. ........... 200,000
4,350,000
ROC Communities, Inc. ............. 100,000
2,250,000
Storage Trust Realty............... 100,000
1,962,500
Walden Residential Properties,
Inc.,............................. 65,000
1,194,375
- ------------
28,809,875
- ------------
Retailing -- 6.6%
Baker (J.), Inc. .................. 150,000
862,500
Big B Inc. ........................ 212,000
3,127,000
Casey's General Stores, Inc. ...... 225,000
5,175,000
Circuit City Stores, Inc. ......... 200,000
6,675,000
Dillard Department Stores, Inc.,
Class A........................... 350,000
9,493,750
Eckerd Corp.*...................... 300,000
11,887,500
Ethan Allen Interiors, Inc.*....... 471,000
9,302,250
General Nutrition Companies,
Inc. ............................. 280,000
6,965,000
Kroger Co.*........................ 150,000
5,006,250
Mercantile Stores.................. 200,000
8,975,000
- ------------
67,469,250
- ------------
Shipping/Transportation -- 2.7%
Consolidated Freightways........... 200,000
4,650,000
GATX Corp. ........................ 200,000
9,500,000
Pittston Services Group............ 250,000
6,875,000
XTRA Corp. ........................ 100,000
4,387,500
Landstar System, Inc.*............. 65,000
1,706,250
- ------------
27,118,750
- ------------
Steel -- 0.5%
LTV Corp.*......................... 400,000
5,600,000
- ------------
Telecommunications -- 1.3%
Aspect Telecommunications Corp.*... 350,000
12,031,250
Mobilemedia Corp. ................. 65,000
1,706,250
- ------------
13,737,500
- ------------
Textile Mill Products -- 1.0%
Springs Industries, Inc., Class
A................................. 125,000
5,359,375
Warnaco Group, Inc., Class A....... 190,000
4,417,500
- ------------
9,776,875
- ------------
Utilities -- 3.9%
CINergy Corp. ..................... 200,000
5,675,000
CMS Energy Corp. .................. 400,000
11,050,000
DQE, Inc. ......................... 300,000
8,250,000
Pinnacle West Capital Corp. ....... 300,000
8,250,000
Public Service Co. of Colorado..... 200,000
6,825,000
- ------------
40,050,000
- ------------
See notes to financial
statements.<FN>
<PAGE>
</TABLE>
<TABLE>
Capital Growth Portfolio
Portfolio of Investments October 31, 1995 (continued)
<CAPTION>--------------------------------------------------
- ----------------------------
<C> <C> <C>
Issuer Shares
Value
- ---<S>-------------------------------- ------------
- --------------
TOTAL COMMON STOCK
(Cost $775,067,805)............... $
880,652,167
- ------------
PREFERRED STOCK -- 0.1%
Electronics/Electrical Equipment --
Comptronix, Ser. A, 6%............. 3,758
6,577
- ------------
Telecommunications --
LCI International, Inc., 5%........ 10,000
478,750
- ------------
TOTAL PREFERRED STOCK
(Cost $250,000)...................
485,327
- ------------
WARRANTS -- 0.1%
Oil & Gas --
BJ Services Co., Expires 1/15/15,
strike price, $30.00
(Cost $600)....................... 60,000
270,000
- ------------
Principal
Amount
------------
CONVERTIBLE CORPORATE BONDS &
NOTES -- 1.0%
Computer Software --
Softkey International Inc.#,
5.5%, due 11/1/00................. $ 5,000,000
4,235,200
- ------------
Computers/Computer Hardware --
Quantum Corp.#,
6.375%, due 4/1/00................ 250,000
265,000
- ------------
Health Care --
ICN Pharmaceutical,
8.5%, due 11/15/99................ 3,000,000
3,346,680
Surgical Laser Technology, Inc.,
8.00%, due 7/30/99................ 3,033
1,820
Shuler Homes,
6.5%, due 1/15/03................. 300,000
252,375
- ------------
3,600,875
- ------------
Restaurants/Food Services --
Flagstar Companies, Inc.,
10%, due 11/1/14.................. 100,000
61,167
- ------------
Tire & Rubber --
Titan Wheel International,
4.75%, due 12/1/00................ 1,500,000
1,800,000
- ------------
Principal
Issuer Amount
Value
- ----------------------------------- ------------
- --------------
TOTAL CONVERTIBLE CORPORATE BONDS &
NOTES
(Cost $10,140,800)................ $
9,962,242
- ------------
VARIABLE RATE NOTES -- 1.1%
Goldman Sachs #,
5.85%, due 7/1/96@
(Cost $12,000,000)............... $ 12,000,000
11,889,720
- ------------
TOTAL LONG-TERM INVESTMENTS
(Cost $797,459,205)...............
903,259,456
- ------------
SHORT-TERM INVESTMENTS -- 10.4%
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 3.9%
Federal Home Loan Bank, Discount
Note, due 12/04/95................ 20,000,000
19,897,517
Federal National Mortgage
Association, Discount Note,
due 11/15/95...................... 20,000,000
19,956,133
- ------------
TOTAL U.S. GOVERNMENT AGENCY
OBLIGATIONS
(Cost $39,853,650)................
39,853,650
- ------------
COMMERCIAL PAPER -- 6.5%
Household Finance Corp.,
5.80%, due 11/01/95.............. 26,325,000
26,325,000
Merrill Lynch, 5.73%, due
11/10/95.......................... 20,000,000
19,971,350
Receivables Capital Corp.,
5.75%, due 11/15/95#.............. 20,000,000
19,955,278
- ------------
TOTAL COMMERCIAL PAPER
(Cost $66,251,628)................
66,251,628
- ------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $106,105,278)..............
106,105,278
- ------------
TOTAL INVESTMENTS --
(Cost $903,564,483)............... 99.0%
$1,009,364,734
- ------------
- ------------
- ---------------
* = Non-income producing security.
Security may only be sold to qualified
# = institutional investors.
@ = Rate shown is the rate in effect at 10/31/95
See notes to financial
statements.<FN>
<PAGE>
</TABLE>
<TABLE>
International Equity Portfolio
Portfolio of Investments October 31, 1995
- -----------------------------------------------------------
- -------------------
<CAPTION> <C> <C>
<C>
Value
Issuer Shares
(USD)
- -------<S>-------------------------------- ---------
- -------------
LONG-TERM INVESTMENTS -- 93.4%
COMMON STOCK -- 93.2%
ARGENTINA -- 1.1%
Banking--
Banco Frances del Rio de la Plata
S.A., ADR........................... 13,500 $
295,313
Oil & Gas--
YPF Sociedad, ADR..................... 5,000
85,625
- -----------
380,938
- -----------
CHILE -- 0.7%
Packaging --
Cristalerias De Chile S.A., ADR....... 10,000
242,500
- -----------
FINLAND -- 1.7%
Electronics/Electrical Equipment --
Nokia AB, Ser. A...................... 5,000
286,182
Nokia AB, Ser. K Shares............... 1,800
105,145
Paper/Forest Products --
Kymmene OY............................ 7,485
204,511
- -----------
595,838
- -----------
FRANCE -- 5.8%
Automotive --
Peugeot S.A.*......................... 1,000
130,439
Broadcasting & Publishing --
TV Francaise.......................... 1,055
109,097
Consumer Products --
SEITA................................. 7,050
245,418
Financial Services --
Cetelem Group*........................ 1,950
311,457
Leisure --
Salomon S.A........................... 433
250,215
Oil & Gas --
Total S.A., Ser. B.................... 3,200
198,022
Pharmaceuticals --
Roussel-Uclaf......................... 1,500
246,340
Retailing --
Docks De France....................... 3,318
505,496
- -----------
1,996,484
- -----------
GERMANY -- 6.4%
Banking --
Commerzbank AG........................ 1,062
245,922
Electronics/Electrical Equipment --
Siemens AG............................ 313
164,181
Machinery & Equipment --
Mannesmann AG......................... 540
177,819
Pharmaceuticals --
Altana Industrie-Aktien Und Anlagen
AG.................................. 800
465,404
Retailing --
Asko Deutsche Kaufhaus AG............. 790
410,455
Karstadt AG........................... 560
244,387
Utilities --
VEBA AG............................... 11,700
480,573
- -----------
2,188,741
- -----------
Value
Issuer Shares
(USD)
- --------------------------------------- ---------
- -------------
HONG KONG -- 3.0%
Banking --
HSBC Holdings Plc..................... 42,024 $
621,215
Diversified --
Jardine Matheson Holdings............. 70,000
427,000
- -----------
1,048,215
- -----------
INDONESIA -- 1.0%
Telecommunications --
PT Indosat, ADR *..................... 10,000
331,250
- -----------
IRELAND -- 1.9%
Banking --
Bank of Ireland....................... 83,000
551,102
Insurance --
Irish Life Plc........................ 28,000
103,138
- -----------
654,240
- -----------
ITALY -- 1.8%
Telecommunications --
Telecom Italia Mobile................. 287,374
483,457
Stet D Risp Port, Non-Convertible
Savings Shares...................... 60,947
132,975
- -----------
616,432
- -----------
JAPAN -- 30.0%
Automotive --
Hitachi Zosen Corp.,.................. 45,000
221,380
Nissan Motor Co, Ltd.................. 85,000
573,622
Banking --
Industrial Bank of Japan.............. 13,000
354,736
Engineering Services --
JGC Corp. ............................ 26,000
282,263
Electronics/Electrical Equipment --
Advantest Corp........................ 16,000
907,624
Fanuc Co.............................. 21,000
909,873
Keyence Corp.......................... 8,000
985,867
Kyocera Corp.......................... 15,000
1,229,400
Mitsubishi Electric Corp.............. 70,000
523,057
Murata Manufacturing Co., Ltd......... 5,000
171,646
NEC Corp.............................. 51,000
673,382
Ushio Inc............................. 51,000
578,610
Financial Services --
Credit Saison Co. Ltd................. 5,000
105,140
New Japan Securities.................. 72,000
338,012
Machinery & Engineering Equipment --
Komori Corp........................... 21,000
497,041
Mitsubishi Heavy Industries Ltd....... 75,000
578,757
Shin Nippon Machinery................. 7,000
52,716
Retailing --
Ito-Yokado Co. Ltd.................... 12,000
656,071
Steel --
Nippon Steel Company.................. 114,000
377,974
Telecommunications --
Tamura Electric Works................. 20,000
305,149
- -----------
10,322,320
- -----------
See notes to financial
statements.<FN>
<PAGE>
</TABLE>
<TABLE>
International Equity Portfolio
Portfolio of Investments October 31, 1995 (continued)
<CAPTION>--------------------------------------------------
- ----------------------------
<C> <C>
<C>
Value
Issuer Shares
(USD)
- --<S>------------------------------------- ---------
- -------------
MALAYSIA -- 2.8%
Construction Materials --
Sungei Way Holdings Bhd............... 84,000 $
282,645
Packaging --
Kian Joo Can Factory Bhd.............. 169,500
667,060
- -----------
949,705
- -----------
NETHERLANDS -- 5.1%
Appliances & Household Durables --
Philips Gloeilampen................... 4,000
154,577
Broadcasting & Publishing --
Verenigde Nederlandse Uitgevbedri
Verigd Bezit (VNU).................. 2,843
398,398
Financial Services --
International Nederlanden Groep NV.... 8,315
495,687
Food/Beverage Products --
Heineken NV........................... 1,927
341,818
Telecommunications --
Royal PTT Nederland NV................ 10,010
351,951
- -----------
1,742,431
- -----------
SPAIN -- 3.1%
Banking --
Banco Santander....................... 13,545
590,627
Steel --
Acerinox SA -- New.................... 294
30,989
Utilities --
Iberdrola S.A......................... 60,787
458,375
- -----------
1,079,991
- -----------
SWEDEN -- 1.5%
Automotive --
Autoliv AB............................ 4,875
279,660
Machinery & Engineering Equipment --
Svedala Industri AB-Free.............. 10,000
253,706
- -----------
533,366
- -----------
SWITZERLAND -- 5.6%
Pharmaceuticals --
Ciba-Geigy AG (Bearer Shares)......... 300
258,962
Ciba-Geigy AG (Registered Shares)..... 390
337,682
Roche Holding AG...................... 102
741,214
Sandoz AG (Registered Shares)......... 540
445,680
Sandoz AG (Bearer Shares)............. 157
130,684
- -----------
1,914,222
- -----------
THAILAND -- 6.7%
Banking --
Bangkok Metropolitan Bank (Foreign)... 480,000
515,001
Krung Thai Bank Ltd. (Foreign)........ 149,000
592,092
Financial Services --
Finance One Co., Ltd. (Foreign)....... 79,000
442,639
Steel --
Sahaviriya Steel Industry (Foreign)... 180,000
418,438
Telecommunications --
Loxley Company Ltd. (Foreign)......... 16,000
321,717
- -----------
2,289,887
- -----------
UNITED KINGDOM -- 15.0%
Aerospace --
British Aerospace Plc................. 7,629
85,510
Airlines --
British Airways Plc................... 28,864
207,621
Value
Issuer Shares
(USD)
- --------------------------------------- ---------
- -------------
Automotive --
Cowie Group Plc....................... 35,218 $
165,915
Banking --
Abbey National Plc.................... 12,990
109,970
Broadcasting & Publishing --
General Cable Plc..................... 86,000
256,280
Computers/Computer Hardware --
Amstrad Plc........................... 42,044
193,752
Consumer Products --
B.A.T. Industries Plc................. 31,296
256,780
Electronics/Electrical Equipment --
General Electric Company Plc.......... 18,783
93,239
Hotels/Other Lodging --
Greenalls Group Plc................... 45,122
345,254
Industrial Components --
McKechnie Group Plc................... 27,822
191,769
Insurance --
General Accident Plc.................. 26,898
274,912
Lloyds Abbey Life Group............... 20,450
147,907
Royal Insurance Holdings Plc.......... 37,493
231,460
Machinery & Equipment --
Powerscreen International Plc......... 25,754
156,751
Senior Engineering Group Plc.......... 101,176
158,350
Vickers Plc........................... 22,933
90,999
Packaging --
David S. Smith (Holdings) Plc......... 18,961
172,659
Pharmaceuticals --
Glaxo Wellcome Plc.................... 14,899
201,032
Restaurants/Food Services --
Compass Group Plc..................... 13,556
92,152
Retailing --
Tesco Plc............................. 67,925
322,148
Shipping/Transportation --
Ocean Group Plc....................... 18,680
108,675
Telecommunications --
British Telecommunications Plc........ 14,512
86,377
Textile Mill Products and Apparel --
Coats Viyella Plc..................... 49,341
145,866
Dewhirst Group Plc.................... 36,021
106,488
Utilities --
Anglian Water Plc..................... 31,064
276,239
National Power Plc.................... 85,268
272,296
South West Water Plc.................. 23,885
189,177
Thames Water Plc...................... 24,205
201,469
- -----------
5,141,047
- -----------
TOTAL COMMON STOCK
(Cost $29,074,450)....................
32,027,607
- -----------
WARRANTS -- 0.2%
MALAYSIA --
Construction Materials --
Sungei Way Holdings Bhd., expires
06/29/99............................ 12,000
14,168
Packaging --
Kian Joo Can Factory Bhd, expires
05/22/99............................ 23,000
38,016
- -----------
TOTAL WARRANTS
(Cost $13,456)........................ $
52,184
- -----------
See notes to financial
statements.<FN>
<PAGE>
</TABLE>
<TABLE>
International Equity Portfolio
Portfolio of Investments October 31, 1995 (continued)
- -----------------------------------------------------------
- ------------------ <C>
<C>
<CAPTION>
Principal
Amount
(in local
Value
currency)
(USD)
---------
- -------------
CORPORATE BONDS AND NOTES -- .0%
FRANCE --
Banking --
Societe Generale (FRF),
3.50%, due 01/01/00
(Cost $2,844)....................... 15,840 $
3,573
- -----------
TOTAL LONG-TERM INVESTMENTS
(Cost $29,090,750)....................
32,083,364
- -----------
SHORT-TERM INVESTMENTS -- 0.1%
MONEY MARKET DEPOSIT
ACCOUNT -- 0.1%
Principal
Value
Issuer Amount
(USD)
- --------------------------------------- ---------
- -------------
UNITED STATES --
Chase Manhattan Bank @ 4.0%, due
11/01/95
(Cost $51,623)..................... $ 51,623 $
51,623
- -----------
TOTAL INVESTMENTS --
(Cost $29,142,373)................... 93.5% $
32,134,987
- -----------
- -----------
- ---------------
* = Non income producing security.
FRF = French Francs
USD = United States Dollars
ADR = American Depositary Receipts
@ = Affiliated Issuer
See notes to financial
statements.<FN>
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits.
(a) Financial
Statements.
The Financial
Statements for the Maxim Vista
Growth & Income
Portfolio and for Growth &
Income Portfolio
are included in Part B.
(b) Exhibits.
Items (b)(1)-(10)
, b(12) and b(13) are
incorporated by
reference to Registrant's
Pre-Effective
Amendment No. 1 to its
Registration
Statement dated March 10, 1982.
Items (b)(5) and
(b)(8) are incorporated by
reference to
Registrant's Post-Effective
Amendment No. 24 d
ated March 1, 1993.
Computation of
Performance Quotations [Item
(b)(16)] is
incorporated by reference to
Registrant's Post
- -Effective Amendment No. 18
to its
Registration Statement dated May 1,
1989.
(11)
Written C onsents
(a)
Written consent of
Jorden Burt
Berenson & Johnson,
LLP.
(b) Written consent of Deloitte &
Touche, LLP.
Item 25. Persons Controlled by or under Common
Control
with Registrant.
The
organizational chart showing persons
controlled by or
under common control with
Registrant
follows this page.
Item 26. Number of Holders of Securities:
(1)
(2)
Number of Record
Holders
Title of Class
as of October
31, 1995
Common Stock ($.10 par value)
- 1 -
Item 27. Indemnification.
Item 4, Part II, of Registrant's Pre-
Effective
Amendment No. 1 to its Registration
Statement is
herein incorporated by reference.
Item 28. Business and Other Connections of
Investment
Adviser.
Part A to Item 5, Part II to
Registrant's Post-
Effective Amendment No. 7 to its
Registration
Statement is herein incorporated by
reference.
Item 29. Principal Underwriter.
Not applicable.
Item 30. Location of Accounts and Records.
Item 7, Part II, of Registrant's Pre-
Effective
Amendment No. 1 to its Registration
Statement is
herein incorporated by reference.
Item 31. Management Services.
Not applicable.
Item 32. Undertakings.
(a) Not applicable.
(b) Not applicable.
(c) Registrant undertakes to furnish
each person
to whom a prospectus is delivered
with a copy of
Registrant's latest annual report to
shareholders
upon request and without charge.
SIGNATURES
As required by the Securities Act of
1933 and the Investment Company Act of 1940, the Registrant
certifies that it meets all the requirements of this
Registration Statement pursuant to Rule 485(b) and has duly
caused Post-Effective Amendment No. 43 to the Registration
Statement to be signed on its behalf, in the City of
Englewood, State of Colorado, on the 21st day of February,
1996.
MAXIM SERIES FUND, INC.
(Registrant)
By: /s/ D. Low
President (D. Low)
Pursuant to the requirements of the Securities Act of
1933, this Post-Effective Amendment No. 43 to the
Registration Statement has been signed below by the
following persons in the capacities and on the dates ind
icated.
Signature and Title
Date
/s/ D. Low
2/21/96
President (D. Low)
/s/ D. Low
2/21/96
Director (D. Low)
/s/ R. Jennings*
2/21/96
Director (R. Jennings)
/s/ R.P. Koeppe *
2/21/96
Director (R.P. Koeppe)
/s/ J.D. Motz
2/21/96
Director (J.D. Motz)
S-1
Signature and Title
Date
/s/ S. Zisman*
2/21/96
Director (S. Zisman)
/s/ G.R. Derback
2/21/96
Treasurer (G.R. Derback)
/s/ G.R. Derback
2/21/96
Principal Financial Officer
(G.R. Derback)
/s/ G.R. Derback
2/21/96
Principal Accounting Officer
(G.R. Derback)
*By: /s/ R.B. Lurie
R.B. Lurie
Attorney-in-fact pursuant to Powers of Attorney
filed under Post-Effective Amendment No. 19 to this
Registration Statement.
S-2<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, Growth and Income Portfolio has duly caused this
Post-Effective Amendment to the Registration Statement
of Maxim Vista Growth & Income Portfolio, to be signed
on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, on the 21st day of
February, 1996.
GROWTH AND INCOME PORTFOLIO
/s/ H. Richard Vartabedian
H. Richard Vartabedian,
Chairman
This Post-Effective Amendment to the Registration
Statement on Form N-1A has been signed below by the
following persons in the capacities and on the dates
indicated.
Signatures
Title
Date
/s/ H. Richard Vartabedian Chairman and
2/21/96
H. Richard Vartabedian
Trustee
/s/ Stuart W. Cragin Jr. Trustee
2/21/96
Stuart W. Cragin, Jr.
/s/ Fergus Reid, III Trustee
2/21/96
Fergus Reid, III
/s/ Irv Thode Trustee
2/21/96
Irv Thode
Trustee
Richard E. Ten Haken
S-3 <PAGE>
(11)(a)
CONSENT OF JORDEN BURT BERENSON AND JOHNSON<PAGE>
February 20 , 1996
Maxim Series Fund, Inc.
8515 East Orchard Road
Englewood, Colorado 80111
Ladies and Gentlemen:
We hereby consent to the use of our name under the
caption "Legal
Counsel" in the Prospectus contained in Post-Effective Amendment No. 43
to the Registration Statement on Form N-1A (File No. 2-75503) filed by
Maxim Series Fund, Inc. with the Securities and Exchange Commission
under the Securities Act of 1933 and the Investment Company Act of 1940.
Very truly yours,
/s/ Jorden Burt
Berenson & Johnson, LLP
JORDEN BURT
BERENSON & JOHNSON, LLP
<PAGE>
(11)(b)
CONSENT OF DELOITTE & TOUCHE, LLP<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Post-Effective Amendment No. 43 to
Registration Statement No. 2-75503 of Maxim Series Fund, Inc. of our
report dated December 28, 1995 appearing in the Statement of Additional
Information, which is part of such Registration Statement, and to the
reference to us under the heading "Independent Auditors for the Fund and
Growth & Income" appearing in the Prospectus, which is also part of such
registration statment.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Denver, Colorado
February 21, 1996
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