<PAGE>
<PAGE>
As filed with the Securities and Exchange Commission on May 1,
1997
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. 51 (X)
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940
Amendment No. 51 (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
<PAGE>
<PAGE>
appropriate box)
_____ immediately upon filing pursuant to paragraph
(b) of Rule 485
X on May 1, 1997 pursuant to paragraph
(b)(1)(v) 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.
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 February 26,
1997.
<PAGE> 2
<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 Financial Highlights
Information
4. General Description of Introduction; Fund
Registrant Portfolios; The Fund and
Its Shares
5. Management of the Fund Management of the Fund
6. Capital Stock and Other The Fund and Its Shares
Securities
7. Purchase of Securities Being Introduction; Purchase
Offered 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 Not Applicable
History
13. Investment Objectives and The Fund Portfolios
Policies
14. Management of the Registrant Management of the Fund
15. Control Persons and Principal Purchase and Redemption
<PAGE> 3
<PAGE>
Holders of Securities of Shares
16. Investment Advisory and Management of the Fund
Other Services
17. Brokerage Allocation Portfolio Transactions
and Brokerage
18. Capital Stock and Other Not Applicable
Securities
19. Purchase, Redemption and Purchase and Redemption
Price of Securities Being of Shares
Offered
20. Tax Status Taxes
21. Underwriters Not Applicable
22. Calculation of Yield Calculation of Yields
Quotations of Performance and Total Return
Data
23. Financial Statements Financial Statements
PART C
Form N-1A Item Part C Caption
24. Financial Statements and Financial Statements and
Exhibits Exhibits
25. Persons Controlled by or Persons Controlled by or
Under Common Control Under Common Control
26. Number of Holders of Securities Number of Holders of
Securities
27. Indemnification Indemnification
28. Business and Other Connections Business and Other
of Investment Adviser Connections of Investment
Adviser
29. Principal Underwriters Principal Underwriters
30. Location of Accounts and Location of Accounts and
Records Records
31. Management Services Management Services
32. Undertakings Undertakings
<PAGE> 4
<PAGE>
33. Signatures Signatures
<PAGE> 5
<PAGE>
PART A
<PAGE> 6
<PAGE>
MAXIM SERIES FUND, INC.
8515 E. Orchard Road, Englewood, Colorado 80111
Phone No. (303) 689-3000
Maxim Series Fund, Inc. (the "Fund"), an open-end
management investment company, includes the following
diversified investment portfolios: the Money Market Portfolio,
the Bond Portfolio, the Stock Index Portfolio, the U.S.
Government Securities Portfolio, the Total Return Portfolio,
the Small-Cap Index Portfolio, the International Equity
Portfolio, the MidCap Portfolio, the Maxim T. Rowe Price
Equity/Income Portfolio, the Maxim INVESCO Small-Cap Growth
Portfolio, the Maxim INVESCO ADR Portfolio, the Small-Cap
Value Portfolio, Maxim INVESCO Balanced Portfolio and the
Corporate Bond Portfolio.
The investment objective of the Money Market Portfolio is
preservation of capital, liquidity and the highest possible
current income consistent with the foregoing objectives,
through investments in short-term money market securities.
Shares of the Money Market Portfolio are neither insured nor
guaranteed by the U.S. Government. Further, there is no
assurance that the Portfolio will be able to maintain a stable
net asset value of $1.00 per share.
The investment objective of the Bond Portfolio is to seek
to achieve maximum total return, consistent with the
preservation of capital, through investment in an actively
managed portfolio of debt securities.
The principal objective of the Stock Index Portfolio is
to provide investment results, before fees, that correspond to
the total return of the S&P 500 Index and the S&P MidCap
Index, weighted according to their pro rata share of the
market.
The investment objective of the U.S. Government
Securities Portfolio is to seek the highest level of return
consistent with preservation of capital and substantial credit
protection. The Portfolio seeks to achieve this objective by
investing primarily in mortgage-related securities issued or
guaranteed by an agency or instrumentality of the U.S.
Government, other U.S. agency and instrumentality obligations,
and in U.S. Treasury obligations.
The objective of the Total Return Portfolio is to seek to
obtain the highest possible total return, a combination of
income and capital appreciation, consistent with reasonable
risk.
<PAGE> 7
<PAGE>
The objective of the Small-Cap Index Portfolio is to
provide investment results, before fees, that correspond to
the total return of the Russell 2000 Index.
The investment objective of the International Equity
Portfolio is long-term capital growth, which it seeks to
achieve through a flexible policy of investing in stocks and
debt obligations of companies outside the United States.
The investment objective of the MidCap Portfolio is
long-term growth of capital by normally investing at least 65%
of its assets in securities issued by medium-sized companies.
The investment objective of the Maxim T. Rowe Price
Equity/Income Portfolio is to seek to provide substantial
dividend income and also capital appreciation by investing
primarily in dividend-paying common stocks of established
companies. In pursuing its objective, the Portfolio will
emphasize companies with favorable prospects for increasing
dividend income and secondarily, capital appreciation.
The investment objective of the Maxim INVESCO Small-Cap
Growth Portfolio is to seek long-term capital growth. The
Portfolio seeks to achieve this objective by investing its
assets principally in a diversified group of equity securities
of emerging growth companies with market capitalizations of $1
billion or less at the time of initial purchase ("small-cap
companies.")
The investment objective of the Maxim INVESCO ADR
Portfolio is to seek to achieve a high total return on
investment through capital appreciation and current income,
while reducing risk through diversification. In pursuing this
objective, substantially all of the Portfolio's assets will be
invested in foreign securities that are issued in the form of
American Depository Receipts ("ADRs") or foreign stocks that
are registered with the Securities and Exchange Commission
("SEC") and traded in the U.S.
The investment objective of the Small-Cap Value Portfolio
is to achieve long-term capital appreciation by investing
primarily in common stocks, although the Portfolio also may
invest in other securities, including restricted and preferred
stocks.
The investment objective of the Corporate Bond Portfolio
is high total investment return. The Corporate Bond Portfolio
seeks to achieve its investment objective by investing
primarily in debt securities (including convertibles),
although up to 20% of its total assets (measured at the time
of acquisition) may be invested in preferred stocks.
<PAGE> 8
<PAGE>
The investment objective of the Maxim INVESCO Balanced
Portfolio is to seek to achieve a high total return on
investment through capital appreciation and current income.
The Portfolio invests in a combination of common stocks
(normally 50% to 70% of total assets) and fixed-income
securities (normally 25% or more).
This Prospectus sets forth concisely the information about the
Fund 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.
G W CAPITAL MANAGEMENT, INC.
Investment Adviser
The date of this Prospectus is May 1, 1997.
<PAGE> 9
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Money Market Portfolio
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1996 1995
Net Asset Value, Beginning of Period $1.0007 $1.0007
Income from Investment Operations
Net investment income 0.0493 0.0555
Net Gains or Losses on Securities
(realized and unrealized) -- --
Total from Investment Operations 0.0493 0.0555
Less Distributions
Dividends (from net investment
income) (0.0493) (0.0555)
Distributions (from capital gains) -- --
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0493) (0.0555)
Net Asset Value End of Period $1.0007 $1.0007
Net Assets, End of Period 396,453,188 277,257,289
Ratio of Expenses to Average Net
Assets 0.46% 0.46%
Ratio of Net Income to Average
Net Assets 4.99% 5.55%
Portfolio Turnover Rate -- --
</TABLE>
<PAGE> 10
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1994, 1993
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Money Market Portfolio
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1994 1993
Net Asset Value, Beginning of Period $1.0007 $1.0007
Income from Investment Operations
Net investment income 0.0394 0.0278
Net Gains or Losses on Securities
(realized and unrealized) -- --
Total from Investment Operations 0.0394 0.0278
Less Distributions
Dividends (from net investment
income) (0.0394) (0.0278)
Distributions (from capital gains) -- --
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0394) (0.0278)
Net Asset Value End of Period $1.0007 $1.0007
Net Assets, End of Period 186,587,262 96,997,973
Ratio of Expenses to Average Net
Assets 0.46% 0.46%
Ratio of Net Income to Average
Net Assets 3.96% 2.82%
Portfolio Turnover Rate -- --
</TABLE>
<PAGE> 11
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1992, 1991
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Money Market Portfolio
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1992 1991
Net Asset Value, Beginning of Period $1.0006 $1.0005
Income from Investment Operations
Net investment income 0.0343 0.0565
Net Gains or Losses on Securities
(realized and unrealized) 0.0001 0.0001
Total from Investment Operations 0.0344 0.0566
Less Distributions
Dividends (from net investment
income) (0.0343) (0.0565)
Distributions (from capital gains) -- --
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0343) (0.0565)
Net Asset Value End of Period $1.0007 $1.0006
Net Assets, End of Period 64,220,562 52,118,377
Ratio of Expenses to Average Net
Assets 0.46% 0.48%
Ratio of Net Income to Average
Net Assets 3.43% 6.15%
Portfolio Turnover Rate -- --
</TABLE>
<PAGE> 12
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1990, 1989
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Money Market Portfolio
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1990 1989
Net Asset Value, Beginning
of Period $1.0027 $1.0014
Income from Investment Operations
Net investment income 0.0766 0.0870
Net Gains or Losses on Securities
(realized and unrealized) (0.0022) 0.0013
Total from Investment Operations 0.0744 0.0883
Less Distributions
Dividends (from net investment income)(0.0766) (0.0870)
Distributions (from capital gains) -- --
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0766) (0.0870)
Net Asset Value End of Period $1.0005 $1.0027
Net Assets, End of Period 36,738,618 28,749,125
Ratio of Expenses to Average Net
Assets 0.50% 0.50%
Ratio of Net Income to Average
Net Assets 8.14% 9.18%
Portfolio Turnover Rate -- --
</TABLE>
<PAGE> 13
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1988, 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Money Market Portfolio
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1988 1987
Net Asset Value, Beginning of
Period $1.0002 $0.9988
Income from Investment Operations
Net investment income 0.0711 0.0635
Net Gains or Losses on Securities
(realized and unrealized) 0.0018 0.0014
Total from Investment Operations 0.0729 0.0649
Less Distributions
Dividends (from net investment
income) (0.0711) (0.0635)
Distributions (from capital gains) (0.0006) --
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0717) (0.0635)
Net Asset Value End of Period $1.0014 $1.0002
Net Assets, End of Period 24,590,994 18,947,848
Ratio of Expenses to Average Net
Assets 0.50% 0.50%
Ratio of Net Income to Average
Net Assets 7.61% 6.85%
Portfolio Turnover Rate -- --
</TABLE>
<PAGE> 14
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Bond Portfolio
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.2301 $1.1352
Income from Investment Operations
Net investment income 0.0745 0.0736
Net Gains or Losses on Securities
(realized and unrealized) (0.0242) (0.0949)
Total from Investment Operations 0.0503 0.1685
Less Distributions
Dividends (from net investment income) (0.0745) (0.0736)
Distributions (from capital gains) - -
Initial Capitalization - -
Returns of Capital Total Distributions (0.0745) (0.0736)
Net Asset Value End of Period $1.2059 $1.2301
Total Return (1) 4.26% 15.21%
Net Assets, End of Period 78,093,10980,025,099
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 6.10% 6.16%
Portfolio Turnover Rate 117.39% 191.58%
(1)The performance shown does not reflect fees or expenses
at the separate account level.
</TABLE>
<PAGE> 15
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Bond Portfolio
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.2274 $1.2259
Income from Investment Operations
Net investment income 0.0634 0.0632
Net Gains or Losses on Securities
(realized and unrealized) (0.0922) 0.0326
Total from Investment Operations (0.0288) 0.0958
Less Distributions
Dividends (from net investment income) (0.0634) (0.0632)
Distributions (from capital gains) (0.0311) (0.0311)
Initial Capitalization - -
Returns of Capital Total Distributions (0.0634) (0.0943)
Net Asset Value End of Period $1.1352 $1.2274
Total Return (1) -2.36% 8.56%
Net Assets, End of Period 68,965,29984,696,187
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 5.33% 5.02%
Portfolio Turnover Rate 60.85% 164.32%
(1)The performance shown does not reflect fees or expenses
at the separate account level.
</TABLE>
<PAGE> 16
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Bond Portfolio
Years Ended December 31,
1992 1991
<S> <C> <C>
Net Asset Value, Beginning of Period $1.2929 $1.2312
Income from Investment Operations
Net investment income 0.0831 0.0939
Net Gains or Losses on Securities
(realized and unrealized) (0.0053) 0.0798
Total from Investment Operations 0.0778 0.1737
Less Distributions
Dividends (from net investment income) (0.0760) (0.0884)
Distributions (from capital gains) (0.0688) (0.0236)
Initial Capitalization - -
Returns of Capital Total Distributions (0.1448) (0.1120)
Net Asset Value End of Period $1.2259 $1.2929
Total Return (1) 6.24% 14.70%
Net Assets, End of Period 69,974,484 88,545,656
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 5.93% 7.64%
Portfolio Turnover Rate 157.97% 168.18%
(1)The performance shown does not reflect fees or expenses
at the separate account level.
<PAGE> 17
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
</TABLE>
<TABLE>
<CAPTION>
Bond Portfolio
Years Ended December 31,
1990 1989
<S> <C> <C>
Net Asset Value, Beginning of Period $1.2297 $1.1725
Income from Investment Operations
Net investment income 0.0946 0.0918
Net Gains or Losses on Securities
(realized and unrealized) 0.0015 0.0572
Total from Investment Operations 0.0961 0.1490
Less Distributions
Dividends (from net investment income) (0.0946) (0.0918)
Distributions (from capital gains) - -
Initial Capitalization - -
Returns of Capital Total Distributions (0.0946) (0.0918)
Net Asset Value End of Period $1.2312 $1.2297
Total Return (1) 8.21% 13.11%
Net Assets, End of Period 62,311,336 47,442,300
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 8.41% 8.21%
Portfolio Turnover Rate 89.91% 79.68%
(1)The performance shown does not reflect fees or expenses
at the separate account level.
</TABLE>
<PAGE> 18
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Bond Portfolio
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1988 1987
Net Asset Value, Beginning of Period $1.2002 $1.2640
Income from Investment Operations
Net investment income 0.0916 0.0851
Net Gains or Losses on Securities
(realized and unrealized) (0.0275) (0.0495)
Total from Investment Operations 0.0641 0.0356
Less Distributions
Dividends (from net investment income) (0.0918) (0.0850)
Distributions (from capital gains) -
Initial Capitalization - (0.0144)
Returns of Capital Total Distributions (0.0918) (0.0994)
Net Asset Value End of Period $1.1725 $1.2002
Total Return (1) 5.40% 2.82%
Net Assets, End of Period 35,806,047 27,251,255
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 8.27% 7.64%
Portfolio Turnover Rate 80.62% 151.78%
(1) The performance shown does not reflect fees or expenses
at the separate account level.
</TABLE>
<PAGE> 19
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990,1989, 1988, 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Stock Index Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1996 1995
Net Asset Value, Beginning of Period $1.9796 $1.4978
Income from Investment Operations
Net investment income 0.0336 0.0334
Net Short-Term realized gain 0.0009 0.0010
Net Gains or Losses on Securities
(realized and unrealized) 0.3951 0.4953
Total from Investment Operations 0.4296 0.5297
Less Distributions
Dividends (from net investment income
and Net Short-Term realized gains) (0.0345) (0.0344)
Distributions (from capital gains) (0.0097) (0.0135)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0442) (0.0479)
Net Asset Value End of Period $2.3650 $1.9796
Total Return (1) 21.81% 35.60%
Net Assets, End of Period 936,806,358 707,459,637
Average Commission Rate Paid Per
Share Bought or Sold $0.0389
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 1.58% 1.91%
Portfolio Turnover Rate 3.31% 5.25%
</TABLE>
* From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio. During these periods, the Portfolio's investment
policies differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 20
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1994, 1993
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Stock Index Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1994 1993
Net Asset Value, Beginning of Period $1.5575 $1.4506
Income from Investment Operations
Net investment income 0.0350 0.0320
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0335) 0.1097
Total from Investment Operations 0.0015 0.1417
Less Distributions
Dividends (from net investment
income and Net Short-Term realized gains) (0.0350) (0.0320)
Distributions (from capital gains) (0.0262) (0.0028)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0612) (0.0348)
Net Asset Value End of Period $1.4978 $1.5575
Total Return (1) 0.14% 9.84%
Net Assets, End of Period 497,339,992 562,189,394
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 2.23% 2.14%
Portfolio Turnover Rate 11.98% 1.68%
* From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio. During these periods, the Portfolio's investment
policies differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
</TABLE>
<PAGE> 21
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1992, 1991
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Stock Index Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1992 1991
Net Asset Value, Beginning of Period $1.5206 $1.3191
Income from Investment Operations
Net investment income 0.0383 0.0563
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.0502 0.2492
Total from Investment Operations 0.0885 0.3055
Less Distributions
Dividends (from net investment
income and Net Short-Term realized gains) (0.0382) (0.0542)
Distributions (from capital gains) (0.1203) (0.0498)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.1585) (0.1040)
Net Asset Value End of Period $1.4506 $1.5206
Total Return (1) 5.87% 23.33%
Net Assets, End of Period 462,539,021 359,177,318
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 2.49% 4.33%
Portfolio Turnover Rate 118.83% 24.28%
</TABLE>
* From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio. During these periods, the Portfolio's investment
policies differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 22
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1990, 1989
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Stock Index Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1990 1989
Net Asset Value, Beginning of Period $1.3947 $1.2986
Income from Investment Operations
Net investment income 0.0682 0.0769
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0756) 0.1213
Total from Investment Operations (0.0074) 0.1982
Less Distributions
Dividends (from net investment
income and Net Short-Term realized gains) (0.0682) (0.0769)
Distributions (from capital gains) -- (0.0252)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0682) (0.1021)
Net Asset Value End of Period $1.3191 $1.3947
Total Return (1) -0.58% 15.21%
Net Assets, End of Period 223,661,178 182,730,744
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 5.70% 6.15%
Portfolio Turnover Rate 26.41% 37.96%
</TABLE>
* From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio. During these periods, the Portfolio's investment
policies differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 23
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1988, 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Stock Index Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1988 1987
Net Asset Value, Beginning of Period $1.1788 $1.2743
Income from Investment Operations
Net investment income 0.0605 0.0563
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.1518 0.0412
Total from Investment Operations 0.2123 0.0975
Less Distributions
Dividends (from net investment income
and Net Short-Term realized gains) (0.0608) (0.0559)
Distributions (from capital gains) (0.0317) (0.1371)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0925) (0.1930)
Net Asset Value End of Period $1.2986 $1.1788
Total Return (1) 17.91% 5.85%
Net Assets, End of Period 134,553,151 97,806,067
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 5.29% 4.61%
Portfolio Turnover Rate 44.65% 47.66%
* From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio. During these periods, the Portfolio's investment
policies differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
</TABLE>
<PAGE> 24
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
U.S. Government Securities Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1996 1995
Net Asset Value, Beginning of Period $1.0010 $1.0138
Income from Investment Operations
Net investment income 0.0675 0.0723
Net Gains or Losses on Securities
(realized and unrealized) (0.0263) 0.0863
Total from Investment Operations 0.0412 0.1586
Less Distributions
Dividends (from net investment income) (0.0675) (0.0723)
Distributions (from capital gains) -- --
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0675) (0.0723)
Net Asset Value End of Period $1.0738 $1.1001
Total Return (1) 3.92% 16.09%
Net Assets, End of Period 64,077,863 62,473,959
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 6.22% 6.76%
Portfolio Turnover Rate 145.02% 185.57%
*From July 29, 1987 until May 1, 1990 the Portfolio's name was
the Government and High Quality Securities Portfolio and from
April 8, 1985 to July 29, 1987 the Portfolio's name was the
Government Guaranteed Portfolio. During these periods, the
Portfolio's investment policies differed from its current
policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
(2) In 1994, the Portfolio turnover rate was higher than in
past years due to the impact of rising interest rates with
respect to the reverse dollar repurchase ( dollar roll )
strategy utilized for this Portfolio. High Portfolio turnover
rates may occur in the future if similar economic conditions
occur.
</TABLE>
<PAGE> 25
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1994, 1993
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
U.S. Government Securities Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1994 1993
Net Asset Value, Beginning of Period $1.1061 $1.1141
Income from Investment Operations
Net investment income 0.0572 0.0881
Net Gains or Losses on Securities
(realized and unrealized) (0.0924) (0.0006)
Total from Investment Operations 0.0352 0.0875
Less Distributions
Dividends (from net investment income) (0.0571) (0.0887)
Distributions (from capital gains) -- (0.0068)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0571) (0.0955)
Net Asset Value End of Period $1.0138 $1.1061
Total Return (1) -3.20% 9.35%
Net Assets, End of Period 56,338,235 51,424,663
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 5.47% 8.49%
Portfolio Turnover Rate (2)308.47% 27.28%
*From July 29, 1987 until May 1, 1990 the Portfolio's name was
the Government and High Quality Securities Portfolio and from
April 8, 1985 to July 29, 1987 the Portfolio's name was the
Government Guaranteed Portfolio. During these periods, the
Portfolio's investment policies differed from its current
policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
(2) In 1994, the Portfolio turnover rate was higher than in
past years due to the impact of rising interest rates with
respect to the reverse dollar repurchase ( dollar roll )
strategy utilized for this Portfolio. High Portfolio turnover
rates may occur in the future if similar economic conditions
occur.</TABLE>
<PAGE> 26
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1992, 1991
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
U.S. Government Securities Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1992 1991
Net Asset Value, Beginning of Period $1.1206 $1.0779
Income from Investment Operations
Net investment income 0.1037 0.0775
Net Gains or Losses on Securities
(realized and unrealized) (0.0069) 0.0709
Total from Investment Operations 0.0968 0.1484
Less Distributions
Dividends (from net investment income) (0.0581) (0.0839)
Distributions (from capital gains) (0.0452) (0.0218)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.1033) (0.1057)
Net Asset Value End of Period $1.1141 $1.1206
Total Return (1) 8.94% 14.34%
Net Assets, End of Period 30,350,801 32,730,410
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 4.96% 8.09%
Portfolio Turnover Rate 42.15% 213.79%
*From July 29, 1987 until May 1, 1990 the Portfolio's name was
the Government and High Quality Securities Portfolio and from
April 8, 1985 to July 29, 1987 the Portfolio's name was the
Government Guaranteed Portfolio. During these periods, the
Portfolio's investment policies differed from its current
policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
(2) In 1994, the Portfolio turnover rate was higher than in
past years due to the impact of rising interest rates with
respect to the reverse dollar repurchase ("dollar roll")
strategy utilized for this Portfolio. High Portfolio turnover
rates may occur in the future if similar economic conditions
occur.</TABLE>
<PAGE> 27
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1990, 1989
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
U.S. Government Securities Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1990 1989
Net Asset Value, Beginning of Period $1.0708 $1.0292
Income from Investment Operations
Net investment income 0.0901 0.0869
Net Gains or Losses on Securities
(realized and unrealized) 0.0071 0.0416
Total from Investment Operations 0.0972 0.1285
Less Distributions
Dividends (from net investment income) (0.0901) (0.0869)
Distributions (from capital gains) -- --
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0901) (0.0869)
Net Asset Value End of Period $1.0779 $1.0708
Total Return (1) 9.70% 13.10%
Net Assets, End of Period 39,727,586 44,046,887
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 9.11% 8.88%
Portfolio Turnover Rate 138.07% 52.55%
*From July 29, 1987 until May 1, 1990 the Portfolio's name was
the Government and High Quality Securities Portfolio and from
April 8, 1985 to July 29, 1987 the Portfolio's name was the
Government Guaranteed Portfolio. During these periods, the
Portfolio's investment policies differed from its current
policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
(2) In 1994, the Portfolio turnover rate was higher than in
past years due to the impact of rising interest rates with
respect to the reverse dollar repurchase ("dollar roll")
strategy utilized for this Portfolio. High Portfolio turnover
rates may occur in the future if similar economic conditions
occur.</TABLE>
<PAGE> 28
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1988, 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
U.S. Government Securities Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1988 1987
Net Asset Value, Beginning of Period $1.0473 $1.0934
Income from Investment Operations
Net investment income 0.0867 0.0800
Net Gains or Losses on Securities
(realized and unrealized) (0.0179) (0.0382)
Total from Investment Operations 0.0688 0.0418
Less Distributions
Dividends (from net investment income) (0.0869) (0.0879)
Distributions (from capital gains) -- (0.0079)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0869) (0.0800)
Net Asset Value End of Period $1.0292 $1.0473
Total Return (1) 6.78% 3.96%
Net Assets, End of Period 47,866,066 49,577,136
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 8.84% 8.16%
Portfolio Turnover Rate 36.83% 116.66%
*From July 29, 1987 until May 1, 1990 the Portfolio's name was
the Government and High Quality Securities Portfolio and from
April 8, 1985 to July 29, 1987 the Portfolio's name was the
Government Guaranteed Portfolio. During these periods, the
Portfolio's investment policies differed from its current
policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
(2) In 1994, the Portfolio turnover rate was higher than in
past years due to the impact of rising interest rates with
respect to the reverse dollar repurchase ( dollar roll )
strategy utilized for this Portfolio. High Portfolio turnover
rates may occur in the future if similar economic conditions
occur.
</TABLE>
<PAGE> 29
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Total Return Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1996 1995
Net Asset Value, Beginning of Period $1.2969 $1.1238
Income from Investment Operations
Net investment income 0.0366 0.0421
Net Short-Term realized gain 0.0139
Net Gains or Losses on Securities
(realized and unrealized) 0.1146 0.1960
Total from Investment Operations 0.1512 0.2520
Less Distributions
Dividends (from net investment
income and Net Short-Term realized gains) (0.0366) (0.0560)
Distributions (from capital gains) (0.0703) (0.0229)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.1069) (0.0789)
Net Asset Value End of Period $1.3412 $1.2969
Total Return (1) 11.75% 22.70%
Net Assets, End of Period 64,660,804 55,176,028
Average Commission Rate Paid
Per Share Bought or Sold $0.0691
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 2.78% 3.41%
Portfolio Turnover Rate 74.52% 44.70%
*The Total Return Portfolio was
established effective July 29, 1987.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
</TABLE>
<PAGE> 30
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1994, 1993
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Total Return Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1994 1993
Net Asset Value, Beginning of Period $1.2065 $1.1327
Income from Investment Operations
Net investment income 0.0382 0.0326
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0704) 0.1025
Total from Investment Operations (0.0322) 0.1351
Less Distributions
Dividends (from net investment income
and Net Short-Term realized gains) (0.0382) (0.0326)
Distributions (from capital gains) (0.0123) (0.0287)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0505) (0.0613)
Net Asset Value End of Period $1.1238 $1.2065
Total Return (1) -2.68% 12.19%
Net Assets, End of Period 41,348,517 39,297,459
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 3.30% 2.88%
Portfolio Turnover Rate 74.85% 58.02%
*The Total Return Portfolio was established effective July 29,
1987.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
</TABLE>
<PAGE> 31
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1992, 1991
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Total Return Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1992 1991
Net Asset Value, Beginning of Period $1.1156 $1.0017
Income from Investment Operations
Net investment income 0.0424 0.0979
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.0165 0.1177
Total from Investment Operations 0.0589 0.2156
Less Distributions
Dividends (from net investment income
and Net Short-Term realized gains) (0.0375) (0.0543)
Distributions (from capital gains) (0.0043) (0.0474)
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0418) (0.1017)
Net Asset Value End of Period $1.1327 $1.1156
Total Return (1) 5.45% 22.04%
Net Assets, End of Period 18,696,606 11,783,118
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 3.56% 5.52%
Portfolio Turnover Rate 29.26% 92.80%
*The Total Return Portfolio was established effective July 29,
1987.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
</TABLE>
<PAGE> 32
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1990, 1989
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Total Return Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1990 1989
Net Asset Value, Beginning of Period $1.0279 $0.9018
Income from Investment Operations
Net investment income 0.0541 0.0542
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0262) 0.1261
Total from Investment Operations 0.0279 0.1803
Less Distributions
Dividends (from net investment income
and Net Short-Term realized gains) (0.0541) (0.0542)
Distributions (from capital gains) -- --
Initial Capitalization -- --
Returns of Capital Total
Distributions (0.0541) (0.0542)
Net Asset Value End of Period $1.0017 $1.0279
Total Return (1) 2.92% 20.48%
Net Assets, End of Period 11,875,970 13,205,175
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 5.98% 6.17%
Portfolio Turnover Rate 59.96% 59.25%
*The Total Return Portfolio was established effective July 29,
1987.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
</TABLE>
<PAGE> 33
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1988, 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
Total Return Portfolio*
Years Ended December 31,
<TABLE>
<CAPTION>
<S> <C> <C>
1988 1987
Net Asset Value, Beginning of Period $0.8750 --
Income from Investment Operations
Net investment income 0.0536 0.0180
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.0271 (0.3738)
Total from Investment Operations 0.0807 (0.3558)
Less Distributions
Dividends (from net investment income
and Net Short-Term realized gains) (0.0539) (0.0178)
Distributions (from capital gains) -- --
Initial Capitalization -- 1.2486
Returns of Capital Total
Distributions (0.0539) 1.2308
Net Asset Value End of Period $0.9018 $0.8750
Total Return (1) 9.34% --
Net Assets, End of Period 10,992,865 9,644,569
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average
Net Assets 6.56% 5.35%
Portfolio Turnover Rate 92.15% 67.24%
*The Total Return Portfolio was established effective July 29,
1987.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
</TABLE>
<PAGE> 34
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Index Portfolio
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.1680 $0.9540
Income from Investment Operations
Net investment income 0.0124 0.0102
Net Short-Term realized gain 0.0374 0.0095
Net Gains or Losses on Securities
(realized and unrealized) 0.1284 0.2298
Total from Investment Operations 0.1783 0.2495
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0498) (0.0197)
Distributions (from capital gains) (0.5950) (0.0158)
Initial Capitalization - -
Returns of Capital Total
Distributions (0.1093) (0.0355)
Net Asset Value End of Period $1.2370 $1.1680
Total Return (1) 15.30% 26.24%
Net Assets, End of Period 80,783,692 51,610,284
Average Commission Rate Paid Per
Share Bought or Sold $0.0453
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average Net
Assets 1.04% 1.00%
Portfolio Turnover Rate 39.66% 30.17%
<PAGE> 35
<PAGE>
</TABLE>
* Annualized
** The Small-Cap Index was established effective December 1,
1993.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 36
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Index Portfolio
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0112 $1.0000
Income from Investment Operations
Net investment income 0.0097 0.0009
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0572) 0.0112
Total from Investment Operations (0.0475) 0.0121
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0097) (0.0009)
Distributions (from capital gains) - -
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0097) (0.0009)
Net Asset Value End of Period $0.9540 $1.0112
Total Return (1) -4.69% 1.21%
Net Assets, End of Period 22,336,944 5,936,716
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%*
Ratio of Net Income to Average Net
Assets 1.20% 1.24%*
Portfolio Turnover Rate 53.44% 0.72%
</TABLE>
* Annualized
<PAGE> 37
<PAGE>
** The Small-Cap Index was established effective December 1,
1993.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 38
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Value Portfolio
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0669 $0.9974
Income from Investment Operations
Net investment income 0.0095 0.0286
Net Short-Term realized gain 0.0350
Net Gains or Losses on Securities 0.1811 0.0884
(realized and unrealized) 0.1906 0.1520
Total from Investment Operations
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0095) (0.0636)
Distributions (from capital gains) (0.0189)
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0095) (0.0825)
Net Asset Value End of Period $1.2480 $1.0669
Total Return (1) 17.94% 15.51%
Net Assets, End of Period 36,599,651 20,769,579
Average Commission Rate Paid Per
Share Bought or Sold $0.0521
Ratio of Expenses to Average Net
Assets 1.31%# 1.35%#
Ratio of Net Income to Average Net
Assets 0.90% 2.51%
Portfolio Turnover Rate 30.61% 17.78%
</TABLE>
* Annualized
<PAGE> 39
<PAGE>
** The Small-Cap Value Portfolio was established effective
December 1, 1993.
# Percentages are shown net of expenses reimbursed by The
Great-West Life Assurance Company or GW Capital
Management, Inc.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 40
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Value Portfolio
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0330 $1.0000
Income from Investment Operations
Net investment income 0.0068 0.0012
Net Short-Term realized gain
Net Gains or Losses on Securities (0.0356) 0.0330
(realized and unrealized) (0.0288) 0.0342
Total from Investment Operations
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0068) (0.0012)
Distributions (from capital gains) - -
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0068) (0.0012)
Net Asset Value End of Period $0.9974 $1.0330
Total Return (1) -2.78% 3.42%
Net Assets, End of Period 9,721,848 3,007,882
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 1.33%# 1.33%*#
Ratio of Net Income to Average Net
Assets 0.80% 1.52%*
Portfolio Turnover Rate 16.81% -
</TABLE>
<PAGE> 41
<PAGE>
* Annualized
** The Small-Cap Value Portfolio was established effective
December 1, 1993.
# Percentages are shown net of expenses reimbursed by The
Great-West Life Assurance Company or GW Capital
Management, Inc.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, and 1993**
The following tables should be read in conjunction with the
financial
statements and related notes included in the Statement of
Additional
Information.
<TABLE>
<CAPTION>
International Equity Portfolio
Years Ended December 31,
<S> <C> <C>
1996 1995
Net Asset Value, Beginning of Period $1.1395 $1.0673
Income from Investment Operations
Net investment income 0.0136 0.0190
Net Short-Term realized gain 0.0045 0.0034
Net Gains or Losses on Securities
(realized and unrealized) 0.2042 0.0722
Total from Investment Operations 0.2223 0.0946
Less Distributions
Dividends (from net investment income and
Net Short-Term realized gains) (0.0181) (0.0224)
Distributions (from capital gains) (0.0208) -
Initial Capitalization - -
Returns of Capital Total Distributions (0.0389) (0.0224)
Net Asset Value End of Period $1.3229 $1.1395
Total Return (1) 19.59% 8.93%
Net Assets, End of Period 96,172,049 55,017,668
Average Commission Rate Paid Per Share
Bought or Sold $0.0146
Ratio of Expenses to Average Net Assets 1.39%# 1.50%#
Ratio of Net Income to Average Net Assets 1.24% 1.70%
Portfolio Turnover Rate 22.21% 20.28%
* Annualized
**The International Equity Portfolio was established
effective December 1, 1993.
#Percentages are shown net of expenses reimbursed by The
Great-West Life Assurance Company or G W Capital
Management, Inc.
<PAGE> 42
<PAGE>
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
</TABLE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, and 1993**
The following tables should be read in conjunction with the
financial
statements and related notes included in the Statement of
Additional
Information.
<TABLE>
<CAPTION>
International Equity Portfolio
Years Ended December 31,
<S> <C> <C>
1994 1993
Net Asset Value, Beginning of Period $1.0110 $1.0000
Income from Investment Operations
Net investment income 0.0049 0.0009
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.0563 0.0110
Total from Investment Operations 0.0612 0.0119
Less Distributions
Dividends (from net investment income and
Net Short-Term realized gains) (0.0049) (0.0009)
Distributions (from capital gains) - -
Initial Capitalization - -
Returns of Capital Total Distributions (0.0049) (0.0009)
Net Asset Value End of Period $1.0673 $1.0110
Total Return (1) 6.06% 1.19%
Net Assets, End of Period 32,180,949 3,126,038
Average Commission Rate Paid Per Share
Bought or Sold
Ratio of Expenses to Average Net Assets 1.49%# 1.48%*#
Ratio of Net Income to Average Net Assets 1.25% 1.09%*
Portfolio Turnover Rate 11.49%
* Annualized
**The International Equity Portfolio was established
effective December 1, 1993.
#Percentages are shown net of expenses reimbursed by The
Great-West Life Assurance Company or G W Capital
Management, Inc.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
</TABLE>
<PAGE> 43
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, and 1994**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Mid-Cap Portfolio
Years Ended December 31,
1996 1995 1994
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $1.3538 $1.1003 $1.0000
Income from Investment Operations
Net investment income (0.0083) 0.0018
Net Short-Term realized gain 0.0299 0.0076
Net Gains or Losses on Securities
(realized and unrealized) 0.0890 0.2594 0.1003
Total from Investment Operations 0.0807 0.2911 0.1079
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0317) (0.0076)
Distributions (from capital gains) (0.0018) (0.0059) -
Initial Capitalization - - -
Returns of Capital Total
Distributions (0.0018) (0.0376) (0.0076)
Net Asset Value End of Period $1.4327 $1.3538 $1.1003
Total Return (1) 5.96% 26.50% 10.86%
Net Assets, End of Period 214,710,803 148,264,194 81,088,654
Average Commission Rate Paid Per
Share Bought or Sold $0.0461
Ratio of Expenses to Average Net
Assets 1.07%# 1.10%# 1.07%*#
Ratio of Net Income to Average Net
Assets -0.66% 0.13% 1.26%
Portfolio Turnover Rate 80.31% 167.21% 166.12%
<PAGE> 44
<PAGE>
</TABLE>
* Annualized
** The Mid-Cap Portfolio was established effective January
3, 1994.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
# Percentages are shown net of expenses reimbursed by The
Great-West Life Assurance Company or GW Capital
Management, Inc.
<PAGE> 45
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, and 1994**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Corporate Bond Portfolio
Years Ended December 31,
<S> <C> <C> <C>
1996 1995 1994
Net Asset Value, Beginning of Period $1.1521 $0.9716 $1.0000
Income from Investment Operations
Net investment income 0.0825 0.0842 0.0137
Net Short-Term realized gain 0.0055 0.0159
Net Gains or Losses on Securities
(realized and unrealized) 0.0269 0.1835 (0.0284)
Total from Investment Operations 0.1149 0.2836 (0.0147)
Less Distributions
Dividends (from net investment
income and Net Short-Term
realized gains) (0.8800) (0.1001) (0.0137)
Distributions (from capital gains) (0.0172) (0.0030) -
Initial Capitalization - - -
Returns of Capital Total
Distributions (0.1052) (0.1031) (0.0137)
Net Asset Value End of Period $1.1618 $1.1521 $0.9716
Total Return (1) 10.35% 30.19% -1.47%
Net Assets, End of Period 83,645,029 45,530,190 13,713,195
Ratio of Expenses to
Average Net Assets 0.90% 0.90% 1.08%*
Ratio of Net Income to Average
Net Assets 7.68% 7.89% 8.64%*
Portfolio Turnover Rate 40.02% 24.70% 9.45%
</TABLE>
*Annualized
**The Corporate Bond Portfolio was established effective
November 1, 1994.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 46
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, and 1994**
The following tables should be read in conjunction with the
financial
statements and related notes included in the Statement of
Additional Information.
<TABLE>
<CAPTION>
Maxim T. Rowe Price Equity/Income
Years Ended December 31,
<S> <C> <C>
1996 1995
Net Asset Value, Beginning of Period $1.2633 $0.9805
Income from Investment Operations
Net investment income 0.0299 0.0345
Net Short-Term realized gain 0.0121 0.0051
Net Gains or Losses on Securities
(realized and unrealized) 0.2009 0.2841
Total from Investment Operations 0.2429 0.3237
Less Distributions
Dividends (from net investment income
and Net Short-Term realized gains) (0.4200) (0.0396)
Distributions (from capital gains) (0.0150) (0.0013)
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0570) (0.0409)
Net Asset Value End of Period $1.4492 $1.2633
Total Return (1) 19.39% 33.42%
Net Assets, End of Period 69,535,900 310,950,195
Average Commission Rate Paid Per
Share Bought or Sold $0.0368
Ratio of Expenses to Average
Net Assets 0.95%# 0.95%#
Ratio of Net Income to Average
Net Assets 2.85% 3.46%
Portfolio Turnover Rate 26.15% 14.00%
</TABLE>
* Annualized
**The Maxim T. Rowe Price Equity/Income fund was
established effective November 1, 1994.
#Percentage is shown net of expenses reimbursed by The
Great-West Life Assurance Company or G W Capital
Management, Inc.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 47
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31,1994**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Maxim T. Rowe Price Equity/Income
Years Ended December 31,
<S> <C>
1994
Net Asset Value, Beginning of Period $1.0000
Income from Investment Operations
Net investment income 0.0061
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0195)
Total from Investment Operations (0.0134)
Less Distributions
Dividends (from net investment income
and Net Short-Term realized gains) (0.0061)
Distributions (from capital gains) -
Initial Capitalization -
Returns of Capital Total Distributions (0.0061)
Net Asset Value End of Period $0.9805
Total Return (1) -1.34%
Net Assets, End of Period 2,110,302
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average
Net Assets 0.95%*#
Ratio of Net Income to Average
Net Assets 3.90%*
Portfolio Turnover Rate 2.74%
</TABLE>
* Annualized
**The Maxim T. Rowe Price Equity/Income fund was
established effective November 1, 1994.
#Percentage is shown net of expenses reimbursed by The
Great-West Life Assurance Company or G W Capital
Management, Inc.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 48
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, and 1994**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Maxim INVESCO Small-Cap Growth
Years Ended December 31,
<S> <C> <C> <C>
1996 1995 1994
Net Asset Value, Beginning of Period $1.2734 $1.0054 $1.0000
Income from Investment Operations
Net investment income 0.0024 0.0069 0.0030
Net Short-Term realized gain 0.1530 0.0272
Net Gains or Losses on Securities
(realized and unrealized) 0.1850 0.2846 0.0054
Total from Investment Operations 0.3404 0.3187 0.0084
Less Distributions
Dividends (from net investment income
and Net Short-Term realized gains) (0.1554) (0.0341) (0.0030)
Distributions (from capital gains) (0.0254) (0.0166) -
Initial Capitalization - - -
Returns of Capital Total
Distributions (0.1808) (0.0507) (0.0030)
Net Asset Value End of Period $1.4330 $1.2734 $1.0054
Total Return (1) 26.73% 31.79% 0.84%
Net Assets, End of Period 31,827,778 6,385,180 2,022,380
Average Commission Rate Paid Per
Share Bought or Sold $0.0410
Ratio of Expenses to Average
Net Assets 1.10%# 1.10%# 1.08%*#
Ratio of Net Income to Average
Net Assets 0.25% 0.58% 1.86%*
Portfolio Turnover Rate 265.05% 266.64% -
</TABLE>
* Annualized
**The Maxim INVESCO Small-Cap fund was established
effective November 1, 1994.
#Percentage is shown net of expenses reimbursed by The
Great-West Life Assurance Company or G W Capital
Management, Inc.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 49
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, and 1994**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Maxim INVESCO ADR
Years Ended December 31,
<S> <C> <C> <C>
1996 1995 1994
Net Asset Value, Beginning of Period $1.1255 $0.9859 $1.0000
Income from Investment Operations
Net investment income 0.0112 0.0120 0.0026
Net Gains or Losses on Securities
(realized and unrealized) 0.2266 0.1396 (0.0141)
Total from Investment Operations 0.2378 0.1516 (0.0115)
Less Distributions
Dividends (from net investment income)(0.0112) (0.0120) (0.0026)
Distributions (from capital gains) (0.0013) - -
Initial Capitalization - - -
Returns of Capital Total
Distributions (0.0125) (0.0120) (0.0026)
Net Asset Value End of Period $1.3508 $1.1255 $0.9859
Total Return (1) 21.17% 15.48% -1.16%
Net Assets, End of Period 7,694,858 2,681,969 1,976,834
Average Commission Rate Paid Per
Share Bought or Sold $0.0628
Ratio of Expenses to Average
Net Assets 1.33%# 1.50%# 1.50%*#
Ratio of Net Income to Average
Net Assets 1.20% 1.17% 1.56%*
Portfolio Turnover Rate 15.25% 5.88% 2.42%
</TABLE>
* Annualized
**The Maxim INVESCO ADR fund was established effective
November 1, 1994.
#Percentage is shown net of expenses reimbursed by The
Great-West Life Assurance Company or G W Capital
Management, Inc.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 50
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Year Ended December 31, 1996 **
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Maxim INVESCO Balanced Portfolio
Year Ended December 31,
<S> <C>
1996
Net Asset Value, Beginning of Period $1.0000
Income from Investment Operations
Net investment income 0.0052
Net Short-Term realized gain 0.0012
Net Gains or Losses on Securities
(realized and unrealized) 0.0408
Total from Investment Operations 0.0472
Less Distributions
Dividends (from net investment income and
Short-Term realized gains) (0.0064)
Distributions (from capital gains)
Initial Capitalization -
Returns of Capital Total Distributions (0.0064)
Net Asset Value End of Period $1.0408
Total Return (1) 4.60%
Net Assets, End of Period 15,987,166
Average Commission Rate Paid Per Share Bought or Sold $0.0617
Ratio of Expenses to Average Net Assets 1.00%*
Ratio of Net Income to Average Net Assets 2.84%*
Portfolio Turnover Rate 17.14%
</TABLE>
* Annualized
**The Maxim INVESCO Balanced Portfolio was established
effective October 1, 1996.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 51
<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
and Pinnacle Series Account of Great-West Life & Annuity
Insurance Company ("GWL&A") and to the TNE Series (k) Account
(collectively, the "Series Accounts") of Metropolitan Life
Insurance Company ("MetLife"). 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 MetLife. For information concerning your rights
under a variable contract, see the applicable Series Account
prospectus provided herewith. Shares of the Fund are, and may
in the future be, used to fund benefits under other contracts
issued by GWL&A, its affiliates, MetLife or other insurance
companies. G W Capital Management, Inc. ("GW Capital
Management")is the Investment Adviser for the Fund. The day-
to-day management of certain Portfolios of the Fund is carried
out by sub-advisers which are not affiliated with GW Capital
Management.
THE FUND PORTFOLIOS
Each portfolio has its own investment objective and
investment strategy. The investment objective of any portfolio
may not be changed without a vote of a majority of the shares
of that portfolio. A more detailed description of the Fund's
investment policies and a glossary further describing certain
investment securities mentioned in the discussions that follow
are contained in the Statement of Additional Information.
Money Market Portfolio
The investment objectives of the Money Market Portfolio
are to preserve shareholder capital, to maintain liquidity and
to achieve the highest possible current income consistent with
the foregoing objectives by investing in short-term money
market securities.
The assets of the Money Market Portfolio are invested in
money market instruments with remaining maturities not
exceeding 13 months. The Money Market Portfolio also maintains
a dollar-weighted average portfolio maturity of ninety days or
less. The money market instruments in which the Portfolio may
invest include the following:
1. U.S. government securities and government agency
securities. U.S. government securities consist of various
types of marketable securities by the United States Treasury,
such as bills, notes and bonds. Such securities are direct
<PAGE> 52
<PAGE>
obligations of the United States Government. U.S. government
agency securities are debt securities issued by
government-sponsored enterprises, federal agencies and
international institutions. Such securities are not direct
obligations of the U.S. Treasury but involve government
sponsorship or guarantees. Among the agencies whose debt
securities may be purchased are: the Government National
Mortgage Association and Federal Housing Administration, whose
instruments are supported by the full faith and credit of the
United States; the Farm Credit Bank, whose instruments are not
direct obligations of the United States, although the Farm
Credit Bank is supported by its ability to borrow from the
U.S. Treasury; and the Federal Land Bank, Federal Home Loan
Bank and Federal Home Loan Mortgage Corporation, whose
instruments are not supported by the U.S. Treasury, but only
by the credit of the issuing agency;
2. Certificates of deposit, time deposits, swap
deposits and bankers' acceptances of (i) U.S. commercial banks
or savings and loan associations having total assets in excess
of $1 billion, or (ii) other U.S. commercial banks or savings
and loan associations, foreign branches of U.S. banks, and
U.S. branches of foreign banks if such bank obligations are
fully insured by the Federal Deposit Insurance Corporation;
3. Commercial paper, including variable amount master
demand notes;
4. Repurchase and reverse repurchase agreements. A
repurchase agreement is an instrument under which the
purchaser (e.g., the Fund) acquires ownership of the
obligation (debt security) and the seller agrees at the time
of the sale to repurchase the obligation at a mutually agreed
upon time and price, thereby determining the yield during the
purchaser's holding period. This results in a fixed rate of
return insulated from market fluctuations during such period.
Reverse repurchase agreements involve the sale of securities
held by the Portfolio, with an agreement to repurchase the
securities at an agreed upon price, date and interest payment.
Repurchase agreements could involve certain risks in the event
of default or insolvency of the other party to the agreement,
including possible delays or restrictions upon the Portfolio's
ability to dispose of the underlying securities. The
Investment Adviser, acting under the supervision of the Board
of Directors, reviews the credit worthiness of those dealers
with whom the Portfolio enters into repurchase agreements; and
5. Other money market instruments that the Portfolio
may from time-to-time invest in include floating rate notes
and Eurodollar certificates of deposit if denominated in U.S.
currency.
<PAGE> 53
<PAGE>
The Money Market Portfolio generally invests in
instruments (other than U.S. government securities) that have
received the highest rating by at least one nationally
recognized statistical rating organization ("NRSRO"),
securities whose issuer has received such ratings with respect
to a class of short-term debt obligations that is comparable
in priority and security with the instrument acquired, or
securities which are determined or ratified by the Fund's
Board of Directors as being comparable to the foregoing
securities. The Money Market Portfolio only enters into
repurchase agreements that are collateralized entirely by U.S.
government securities or securities that, at the time the
repurchase agreement is entered into, are rated in the highest
rating categories by at least one NRSRO.
In addition to following the foregoing guidelines, the
Money Market Portfolio intends otherwise to comply with the
requirements of Rule 2a-7 under the Investment Company Act of
1940, as applicable to the Portfolio.
Bond Portfolio
The investment objective of the Bond Portfolio is to seek
to achieve maximum total return, consistent with the
preservation of capital, through investment in an actively
managed portfolio of debt securities.
The Portfolio will normally consist of securities with
various maturities but the weighted average maturity will be 2
to 10 years.
Under normal circumstances, the Portfolio intends to
invest at least 65% of its net assets in debt securities of
the U.S. Government and its agencies; foreign governments,
agencies and supra-national organizations; and, domestic or
foreign corporations. The Portfolio may also invest in
mortgage related and other asset-backed securities, domestic
and foreign commercial banks and money markets including
commercial paper, bankers acceptances, certificates of
deposit, time deposit and repurchase agreements.
Foreign debt exposure will be limited to a maximum of 40%
of total assets (measured at the time of acquisition) in
foreign debt, with a maximum of 20% of total assets (measured
at the time of acquisition) in non-U.S. dollar denominated
foreign debt. No more than 25% of the total assets (measured
at the time of acquisition) may be invested in securities of
issuers located in a single country, other than the U.S. See
"Foreign Investment Risks" in this prospectus.
Foreign currency exchange transactions may be utilized in
an attempt to protect against uncertainty in the level of
<PAGE> 54
<PAGE>
future exchange rates. See "Foreign Currency Exchange
Transactions" in this prospectus.
The Portfolio may invest in up to 10% of its total assets
(measured at the time of acquisition) in securities of below
investment grade quality, commonly referred to as "junk
bonds." Lower rated fixed-income securities generally provide
higher yields, but are subject to greater credit and market
risk than higher quality fixed-income securities and are
considered predominately speculative with respect to the
ability of the issuer to meet principal and interest payments.
In addition, the secondary market may be less liquid for
lower-rated fixed-income securities which may make the
valuation and sale of these securities more difficult.
Securities in the lowest investment grade category BBB by
Standard & Poor's Corporation ("S&P") or Baa by Moody's
Investor Service, Inc. ("Moody's) have some speculative
characteristics.
The Portfolio will also be able to invest in when-issued
securities or forward commitments, engage in securities
lending, reverse repurchase agreements and have the ability to
borrow money for temporary administrative or emergency
purposes. Securities may be purchased on a when-issued basis
and may be purchased or sold on a forward commitment basis in
order to hedge against anticipated changes in interest rates
and prices and/or secure a favorable rate of return. The
Statement of Additional Information contains more detailed
information about these investment practices.
In order to shorten/lengthen or hedge the duration of the
Portfolio and for the purpose of both hedging the foreign
currency and interest-rate risks associated with the Portfolio
securities and increasing the total return of the Portfolio,
active interest rate management techniques through options,
futures contracts, options on certain futures contracts,
interest rate swaps and interest rate caps and floors may be
utilized in the Portfolio. The Statement of Additional
Information contains more detailed information about these
investment practices.
The portfolio turnover rate for the Portfolio in 1996 was
in excess of 100%. High portfolio turnover rates generally
result in higher transactions costs (which are borne directly
by the Portfolio) and may result in greater tax liability.
U.S. Government Securities Portfolio
The investment objective of the U.S. Government
Securities Portfolio is to seek the highest level of return
consistent with preservation of capital and substantial credit
protection. The Portfolio seeks to achieve this objective by
<PAGE> 55
<PAGE>
investing at least 65% of its total assets in securities
issued or guaranteed by the U.S. Government or one of its
agencies or instrumentalities.
Investment by the U.S. Government Securities Portfolio in
U.S. government securities will include direct pass-through
mortgage certificates issued by those government agencies
whose obligations are backed by the full faith and credit of
the United States Government, such as the Government National
Mortgage Association ("GNMA") or the Federal Housing
Administration. Such pass-through certificates represent
individual interests in pools of mortgages insured by the
Veterans Administration, the Farmers' Home Association,
Federal Housing Administration or any other government agency.
Owners of pass-through certificates are entitled to receive a
pro-rata share of the net payments received on the underlying
mortgages, hence such payments are "passed through" to the
owner. Accordingly, the amount and frequency of payments on
such pass-through certificates depends on the rate of
prepayments on the underlying mortgages, which may vary based
upon a variety of economic factors.
The Portfolio may also invest in other U.S. government
securities, such as U.S. Treasury bills, notes and bonds, or
in certificates representing individual interests in pools of
such U.S. Treasury securities. The payment of principal and
interest to the Portfolio on such certificates is fully backed
by the U.S. Government.
The Portfolio also may invest in securities issued by the
Federal National Mortgage Association ("FNMA") and the Federal
Home Loan Mortgage Corporation ("FHLMC").
FNMA and FHLMC both issue mortgage-backed securities that
are similar to GNMAs in that they represent interests in pools
of mortgage loans. FNMA guarantees timely payment of interest
and principal on its certificates.
FHLMC guarantees timely payment of interest and ultimate
payment of principal. The FNMA and FHLMC guarantees are backed
only by those agencies and not by the full faith and credit of
the United States.
The Portfolio also may invest in private mortgage
pass-through securities and collateralized mortgage
obligations ("CMOs"). These CMOs may take the form of those
issued by private issuers and collateralized by securities
issued or guaranteed by the U.S. Government or its agencies or
instrumentalities.
The Portfolio may also enter into reverse dollar
repurchase agreements ("dollar rolls") of mortgage-backed
<PAGE> 56
<PAGE>
securities in which the Portfolio sells securities for
delivery in the current month and simultaneously contracts to
repurchase substantially similar (same type, coupon and
maturity) securities on a specified future date. During the
roll period, the Portfolio forgoes principal and interest paid
on the mortgage-backed securities. The Portfolio is
compensated by the difference between the current sales price
and the lower forward price for proceeds of the initial sale.
Liquid assets equal to the value of the outstanding repurchase
commitments are segregated from general investible funds and
will be marked to market daily. The risk associated with
dollar roll transactions is that the securities may not be
delivered and the Portfolio may incur a loss or will have lost
the opportunity to otherwise invest the amount set aside for
such transaction in the segregated asset account. As of
December 31, 1996, 8.53% of the Portfolio was comprised of
investments subject to dollar roll transactions.
The Portfolio may purchase securities on a when-issued
basis and may purchase or sell securities on a forward
commitment basis in order to hedge against anticipated changes
in interest rates and prices and/or secure a favorable rate of
return. The Statement of Additional Information contains more
information about these investment practices.
The market value of securities held by the Portfolio can
be expected to decline when interest rates rise. Thus, the
U.S. Government Securities Portfolio will generally shorten
the average maturity of the Portfolio when interest rates are
rising and lengthen the average maturity when interest rates
are falling in order to optimize the total return of the
Portfolio.
The Portfolio also may hold money market instruments as
it believes is advisable to maintain liquidity or for
temporary defensive purposes.
The portfolio turnover rate for the Portfolio in 1996 was
in excess of 100%. High portfolio turnover rates generally
result in higher transactions costs (which are borne directly
by the Portfolio) and may result in greater tax liability.
Total Return Portfolio
The investment objective of the Total Return Portfolio is
to seek to obtain the highest possible total return, a
combination of income and capital appreciation, consistent
with reasonable risk.
In seeking its investment objective, the Total Return
Portfolio invests in three market segments: equity securities,
fixed income securities and money market instruments. The
<PAGE> 57
<PAGE>
Portfolio invests in equity securities consisting primarily of
common stock of domestic issuers and any warrants or rights
which may be attached to such common stock. The Portfolio also
may, from time to time, purchase convertible common stock of
such issuers or common stock of foreign issuers. Fixed income
securities in which the Portfolio may invest primarily include
obligations of domestic corporations and governments (federal,
state or municipal obligations) and agencies thereof.
Occasionally, the Portfolio may invest in debt obligations of
foreign governments. See "Investment Limitations" for certain
limitations applicable to investment in securities of foreign
issuers.
The Investment Adviser places primary emphasis on the mix
of investments among the three market segments in accordance
with the Adviser's appraisal of investments most likely to
achieve the highest return based upon its judgment as to
economic prospects and the outlook for interest rates and the
equity markets. The selection of an individual security within
a market segment by the Investment Adviser will be based on
the Adviser's view of the relative attractiveness of the
security. There are no minimum or maximum percentages as to
the amount of the Portfolio's assets which may be invested in
each of the market segments. Major changes in investment mix
may occur several times a year or over several years,
depending upon perceived market and economic conditions.
Except for restrictions noted herein and under
"Investment Restrictions" in the Statement of Additional
Information, the Investment Adviser has complete flexibility
in determining the amount and nature of equity securities,
fixed income securities or money market instruments in which
the Portfolio may invest.
The Portfolio normally invests for long-term gains. It
may, however, invest for short-term gain when, in the view of
the Investment Adviser, evolving economic, business and market
conditions so warrant.
MidCap Portfolio
The Portfolio's investment objective is long-term growth
of capital. The Portfolio will normally invest at least 65% of
its assets in securities issued by medium-sized companies.
Medium-sized companies are those whose market capitalizations
fall within the range of companies in the S&P MidCap 400 Index
(the "S&P MidCap"). Companies whose capitalization falls
outside this range after the Portfolio's initial purchase
continue to be considered medium-sized companies for purposes
of this policy. As of December 30, 1996, the S&P MidCap
included companies with capitalizations between approximately
$192 million to $6.5 billion. The range of the S&P MidCap is
<PAGE> 58
<PAGE>
expected to change on a regular basis. Janus Capital
Corporation serves as sub-adviser to this Portfolio. As such
it is responsible for the day-to-day management of the
Portfolio, subject to the overall supervision of the Fund's
Board of Directors and the Investment Adviser.
Medium-sized companies may suffer more significant losses
as well as realize more substantial growth than larger
capitalized, more established issuers. Thus, investments in
such companies tend to be more volatile and somewhat
speculative.
The Portfolio invests substantially all of its assets in
common stock when it is believed that the relevant market
environment favors profitable investing in those securities.
Common stock investments are selected in industries and
companies that are believed to be experiencing favorable
demand for their products and services, and which operate in a
favorable competitive and regulatory climate. The process of
analysis and selection focuses on earnings growth potential.
In particular, the Portfolio intends to buy stocks with
earnings growth potential that may not be recognized by the
market. Securities are selected solely for their capital
growth potential; investment income is not a consideration.
The Portfolio may also purchase securities of foreign
issuers pursuant to the same selection criteria applicable to
domestic issuers. In addition, factors such as expected levels
of inflation, government policies influencing business
conditions, the outlook for currency relationships, and
prospects for relative economic growth amongst countries,
regions or geographic areas may warrant greater consideration
in selecting foreign stocks. If appropriate, the Portfolio may
purchase foreign securities through dollar-denominated
American Depository Receipts, which do not involve the same
direct currency and liquidity risks as securities denominated
in foreign currency and which are issued by domestic banks and
publicly traded in the United States. The Portfolio may invest
up to 25% of its total assets (measured at the time of
acquisition) in foreign securities denominated in foreign
currency and not publicly traded in the United States.
Investments in foreign securities involve risks that
differ in some respects from investment in securities of U.S.
issuers. These risks include the risk of fluctuations in the
value of the currencies in which they are denominated, the
risk of adverse political and economic developments and, with
respect to certain countries, the possibility of
expropriation, nationalization or confiscatory taxation or
limitations on the removal of funds or other assets of the
Portfolio. Securities of some foreign companies are less
liquid and more volatile than securities of comparable
<PAGE> 59
<PAGE>
domestic companies. There also may be less publicly available
information about foreign issuers than domestic issuers, and
foreign issuers generally are not subject to the uniform
accounting, auditing and financial reporting standards,
practices and requirements applicable to domestic issuers.
Delays may be encountered in settling securities transactions
in certain foreign markets and the Portfolio will incur costs
in converting foreign currencies to U.S. dollars. Custody
charges are generally higher for foreign securities.
The Portfolio may invest in "special situations" from
time to time. A special situation arises when it is believed
that the securities of a particular company will be recognized
and appreciate in value due to a specific development at that
company. Developments creating a special situation might
include a new product or process, a management change or a
technological breakthrough. Investment in special situations
may carry an additional risk of loss in the event that the
anticipated development does not occur or does not result in
the anticipated economic impact on the value of a company's
securities.
The Portfolio may also purchase and write options on
securities (including index options) and options on foreign
currencies, and may invest in futures contracts for the
purchase or sale of instruments based on financial indices,
including interest rates or an index of U.S. Government or
foreign government securities or equity or fixed income
securities futures contracts on foreign currencies and fixed
income securities ("futures contracts"), options on futures
contracts, forward contracts and swaps and swap-related
products. These instruments will be used primarily to hedge
the Portfolio's positions, i.e., to attempt to reduce the
overall level of investment risk that normally would be
expected to be associated with the Portfolio's assets and to
attempt to protect the Portfolio against market movements that
might adversely affect the value of the Portfolio's securities
or the price of securities that the Portfolio is considering
purchasing.
The use of futures, options, forward contracts and swaps
exposes the Portfolio to additional investment risks and
transaction costs. If these techniques are utilized to protect
the Portfolio against potential adverse movements in the
securities, foreign currency or interest rate markets using
these instruments, and such markets do not move in a direction
adverse to the Portfolio, the Portfolio could be left in a
less favorable position than if such strategies had not been
used. Risks inherent in the use of futures, options, forward
contracts and swaps include (1) the risk that interest rates,
securities prices and currency markets will not move in the
directions anticipated; (2) imperfect correlation between the
<PAGE> 60
<PAGE>
price of the securities or currencies being hedged; (3) the
fact that skills needed to use these strategies are different
from those needed to select portfolio securities; (4) the
possible absence of a liquid secondary market for any
particular instrument at any time; and (5) the possible need
to defer closing out certain hedged positions to avoid adverse
tax consequences.
The Portfolio may invest in securities that are
considered illiquid because of the absence of a readily
available market or due to legal or contractual restrictions.
However, certain restricted securities that are not registered
for sale to the general public but that can be resold to
institutional investors may not be considered illiquid,
provided that a dealer or institutional trading market exists.
See "Illiquid Securities" in this prospectus.
Although the Portfolio may normally invest primarily in
equity securities, it may increase its cash position when
investment opportunities with desirable risk/reward
characteristics cannot be located. The Portfolio may also
invest in preferred stocks, warrants, government securities,
corporate bonds and debentures, high-grade commercial paper,
certificates of deposit or other debt securities when it is
believed there is an opportunity for capital growth for such
securities or so that the Portfolio may receive a return on
idle cash. When the Portfolio invests in such securities,
investment income will increase and may constitute a large
portion of the return on the Portfolio. Consequently, the
Portfolio may not participate in market advances or declines
to the extent that it would if it remained fully invested in
common stocks.
The Portfolio may also invest in money market securities
for defensive purposes or as a cash reserve.
International Equity Portfolio
The Portfolio's investment objective is long-term capital
growth, which it seeks to achieve through a flexible policy of
investing in stocks and debt obligations of companies and
governments outside the United States. Any income realized
will be incidental. Templeton Investment Counsel, Inc. serves
as sub-adviser to this Portfolio. As such, it is responsible
for the day-to-day management of the Portfolio subject to the
overall supervision of the Fund's Board of Directors and the
Investment Adviser.
Although the Portfolio will generally invest in common
stock and certain debt securities, rated or unrated, such as
convertible bonds and bonds selling at a discount, whenever,
in the judgment of the sub-adviser, market or economic
<PAGE> 61
<PAGE>
conditions warrant, the Portfolio may, for temporary defensive
purposes, invest without limitation in U.S. government
securities, money market instruments, bank time deposits in
the currency of any major nation and commercial paper.
The investments of the Portfolio in foreign issuers may
involve special risks in addition to those normally associated
with investments in the securities of U.S. issuers. For
example, there may be less publicly available information
about foreign issuers than is available for U.S. issuers, and
foreign auditing, accounting, and financial reporting
practices may differ from U.S. practices. Also, foreign
securities markets may be less active than U.S. markets,
trading may be thin and consequently securities prices may be
more volatile. Generally, all foreign investments are subject
to risks of foreign political and economic instability,
adverse movements in foreign exchange rates, the imposition or
tightening of exchange controls or other limitations, the
repatriation of foreign capital, and changes in foreign
governmental attitudes towards private investment, possibly
leading to nationalization, increased taxation, or
confiscation of underlying fund assets. Also, there is the
risk of possible losses through the holding of securities by
custodians and securities depositories in foreign countries.
The Portfolio is authorized to invest in medium quality
or high risk, lower quality debt securities that are rated
between BBB and as low as CCC by Standard & Poor's Corporation
("S&P") and between Baa and as low as Caa by Moody's Investors
Service, Inc. ("Moody's"), commonly known as "high yield" (or
"junk") bonds, or, if unrated, are of an equivalent investment
quality, as determined by the sub-adviser. As an operating
policy, which may be changed by the Board of Directors without
shareholder approval, the Portfolio will not invest more than
10% of its total assets in debt securities rated BBB or lower
by S&P or Baa or lower by Moody's; however, this limitation is
inapplicable to unrated foreign convertible bonds which are
convertible at any time into equity securities suitable for
investment by the Portfolio. The Board may consider a change
in this operating policy if, in its or the sub-adviser's
judgment, economic conditions change such that a higher level
of investment in high risk, lower quality debt securities
would be consistent with the interest of the Portfolio and its
shareholders. The Portfolio usually effects currency exchange
transactions on a spot (i.e., cash) basis or on a forward
commitment basis at the spot rate prevailing in the foreign
exchange market. However, some price spread on currency
exchange (to cover service charges) will be incurred when the
Portfolio converts assets from one currency to another.
The Portfolio may purchase and write options on
securities and certain futures contracts and invest in certain
<PAGE> 62
<PAGE>
futures contracts. The Statement of Additional Information
contains more detail about these investment practices. For
temporary defensive purposes, the Portfolio may invest in
cash, money market instruments and may also purchase from
banks or broker/dealers Canadian or U.S. government securities
with a simultaneous agreement by the seller to repurchase them
within more than seven days at the original purchase price,
plus accrued interest.
Stock Index Portfolio
The investment objective of the Stock Index Portfolio is
to provide investment results, before fees, that correspond to
the total return of the S&P 500 Index and the S&P MidCap
Index, weighted according to their pro rata share of the
market. The Portfolio will pursue this objective by investing
in common stocks traded on the New York Stock Exchange and the
American Stock Exchange and, to a limited extent, in the
over-the-counter markets.
Standard & Poor's Corporation ("S&P") chooses the 500
stocks comprising the S&P 500 Index on the basis of market
values and industry diversification. Most of the stocks in the
S&P 500 Index are issued by the 500 largest companies, in
terms of the aggregate market value of their outstanding
stock, and such companies are generally listed on the New York
Stock Exchange. Additional stocks that are not among the 500
largest market value stocks are included in the S&P 500 Index
for diversification purposes.
The S&P MidCap Index is market-weighted and consists of
400 stocks of domestic companies, having a median market
capitalization of approximately $1.6 billion. The stocks
included in the S&P 500 Index and the S&P MidCap Index do not
overlap.
Because smaller capitalized companies, regardless of
their shares outstanding, sometimes exhibit illiquidity in the
market, minimum trading volume constraints are placed on
issues selected for the S&P MidCap Index. For this reason, the
S&P MidCap Index includes a small number of lesser known
companies in well known industries whose shares are more
liquid.
S&P is not a sponsor of, or in any other way affiliated
with, the Portfolio or the Fund.
The Portfolio will attempt to duplicate the performance
of the S&P 500 Index and the S&P MidCap Index while keeping
transaction costs low and minimizing Portfolio turnover. To
achieve its investment objective, the Portfolio will purchase
equity securities that, in the Adviser's opinion, will
<PAGE> 63
<PAGE>
reflect, as a group, the composite price performance of the
S&P 500 Index and the S&P MidCap Index. Like these indices,
the Portfolio will hold both dividend-paying and non-dividend
paying common stocks. Under normal circumstances, at least 80%
of the Portfolio's total assets will be invested in securities
included on the S&P 500 Index and the S&P MidCap Index.
A higher portfolio turnover rate may involve
correspondingly greater brokerage commissions and other
expenses which might be borne by the Fund and, thus,
indirectly by its shareholders.
See also "Index Portfolio Management" in this Prospectus
for more information on management practices and risks
associated with index-type portfolios.
Small-Cap Index Portfolio
The investment objective of the Small-Cap Index Portfolio
is to provide investment results, before fees, that correspond
to the total return of the Russell 2000 Index. The Russell
2000 Index was developed in 1979 by the Frank Russell Company
to track the stock market performance of a broadly diversified
group of small capitalization domestic stocks. As of December
31, 1996, the median market capitalization of issues
comprising the Russell 2000 Index was approximately $360
million.
The Portfolio intends to pursue this objective by
investing primarily in common stocks issued by corporations
domiciled in the U.S. and its territories traded on the
various U.S. stock exchanges and, to a limited extent, in the
over-the-counter markets. The Portfolio may not hold all of
the approximately 2,000 securities in the Russell 2000 Index
because of the administrative costs involved and the expenses
associated with trading less active securities. Instead, the
Portfolio may hold a representative sample of securities
included in the Russell 2000 Index.
The Frank Russell Company is not a sponsor of, or in any other
way affiliated with, the Portfolio or the Fund.
The Russell 2000 Index is a subset of the larger Russell
3000 Index. The Russell 3000 Index consists of the largest
3000 publicly traded stocks of corporations domiciled in the
U.S. and its territories and includes large, medium and small
capitalization stocks. The Russell 3000 Index represents
approximately 98% of the total market capitalization of all
U.S. stocks that trade on the New York and American Stock
Exchanges and in the NASDAQ (National Association of
Securities Dealers Automated Quotations) National Market
System over-the-counter market. The Russell 2000 Index
<PAGE> 65
<PAGE>
consists of the 2000 smallest stocks within the Russell 3000,
representing approximately 6% of the Russell 3000 Index total
market capitalization.
The Russell 2000 Index is reconstituted annually to
reflect changes in the marketplace. The Portfolio will
similarly reconstitute itself on an annual basis. The
reconstituted list of securities are ranked based on May 31
total market capitalizations, with the actual reconstitution
effective June 30. As well, securities that leave the Russell
2000 Index for any reason between reconstitution dates will
not be replaced. As a result, the number of securities held in
the Portfolio over the year will fluctuate.
The annual turnover rate of the Russell 2000 Index is
significant, often as high as 25% per year of the total market
capitalization of the Index. This investment strategy will be
implemented only to the extent it is consistent with
maintaining the Fund's qualification as a regulated investment
company under the Internal Revenue Code (see "Dividends,
Distributions and Taxes). The Fund's strategy may be limited,
in particular, by the requirement for such qualification that
less than 30% of the Fund's annual gross income be derived
from the sale or other disposition of stocks or securities
(including options and futures contracts) held for less than
three months.
Historically, small capitalization stocks, which
constitute the Portfolio's primary investments, have been more
volatile in price than the larger capitalization stocks
included in the S&P 500 Index. Among the reasons for the
greater price volatility of these small company stocks are the
less certain growth prospects of smaller firms, the lower
degree of liquidity in the markets for such stocks, and the
greater sensitivity of small companies to changing economic
conditions. Besides exhibiting greater volatility, small
company stocks may, to a degree, fluctuate independently of
larger company stocks. Small company stocks may decline in
price as large company stocks rise, or rise in price as large
company stocks decline. Investors should therefore expect that
the Portfolio may be more volatile than, and may fluctuate
independently of, broad stock market indices such as the S&P
500 Index.
The Portfolio intends that, under normal circumstances,
at least 80% of its total assets will be invested in
securities included in the Russell 2000 Index.
See also "Index Portfolio Management" in this Prospectus
for more information on management practices and risks
associated with index-type portfolios.
<PAGE> 65
<PAGE>
Maxim T. Rowe Price Equity/Income Portfolio
The investment objective of the Maxim T. Rowe Price
Equity/Income Portfolio is to seek to provide substantial
dividend income and also capital appreciation by investing
primarily in dividend-paying common stocks of established
companies. In pursuing its objective, the Portfolio will
emphasize companies with favorable prospects for increasing
dividend income and secondarily, capital appreciation. T. Rowe
Price Associates, Inc. serves as sub-adviser of this
Portfolio. As such, it is responsible for the day-to-day
management of the Portfolio subject to the overall supervision
of the Fund's Board of Directors and the Investment Adviser.
Over time, the income component (dividends and interest
earned) of the Portfolio's investments is expected to be a
significant contributor to the Portfolio's total return. Total
return will consist primarily of dividend income and
secondarily of capital appreciation (or depreciation).
The investment program of the Portfolio is based on
several premises. First, it is believed that, over time,
dividend income can account for a significant component of the
total return from equity investments. Second, dividends are
normally a more stable and predictable source of return than
capital appreciation. While the price of a company's stock
generally increases or decreases in response to short-term
earnings and market fluctuations, its dividends are generally
less volatile. Finally, it is believed that stocks which
distribute a high level of current income tend to have less
price volatility than those which pay below-average dividends.
To achieve its objective, the Portfolio, under normal
circumstances, will invest at least 65% of its total assets in
income-producing common stocks, whose prospects for dividend
growth and capital appreciation are considered favorable. To
enhance capital appreciation potential, the Portfolio will
also use a value-oriented approach, which means it will invest
in stocks believed to be currently undervalued in the
marketplace. The Portfolio's investments will generally be
made in companies which share some of the following
characteristics: established operating histories; above-
average current dividend yields relative to the Standard &
Poor's 500 Stock Index ("S&P 500"); low price/earnings ratios
relative to the S&P 500; sound balance sheets and other
financial characteristics; and, low stock price relative to a
company's underlying value as measured by assets, earnings,
cash flow, or business franchises.
The Portfolio may also invest its assets in fixed income
securities (corporate and government bonds of various
maturities). The Portfolio may also invest in municipal bonds
<PAGE> 66
<PAGE>
when the expected total return from such bonds appears to
exceed the total returns obtainable from corporate or
government bonds of similar credit quality.
Debt securities in which the Portfolio may invest may
include high yield/high risk bonds, commonly referred to as
"junk bonds." The total return and yield of lower quality
bonds can be expected to fluctuate more than the total return
and yield of higher quality, shorter-term bonds, but not as
much as common stocks. Junk bonds are regarded as
predominantly speculative with respect to the issuer's
continuing ability to meet principal and interest payments.
The Portfolio will not purchase a non-investment grade debt
security (or "junk bond"), if immediately after such purchase
the Portfolio would have more than 10% of its total assets
(measured at the time of acquisition) invested in such
securities.
The Portfolio may invest up to 10% of its total assets
(measured at the time of acquisition) in hybrid instruments.
These instruments combine the characteristics of securities,
futures and options. For example, the principal amount,
redemption or conversion terms of a security could be related
to the market price of some commodity, currency or securities
index. Such securities may bear interest or pay dividends at
below market (or even relatively nominal) rates. Under certain
conditions, the redemption value of such an investment could
be zero. Hybrids can have volatile prices and limited
liquidity and their use by the Portfolio may not be
successful.
Although the Portfolio will invest primarily in U.S.
common stocks, it may also purchase other types of securities.
For example, the Portfolio may invest up to 25% of its total
assets (measured at the time of acquisition) in securities
issued by foreign issuers, including non-dollar denominated
securities traded outside the U.S. and dollar denominated
securities traded in the U.S. (such as ADRs). See "Foreign
Investment Risks" in this prospectus.
The Portfolio also may invest in convertible securities
and warrants. Convertible securities may include debt or
preferred equity securities convertible into or exchangeable
for equity securities. Traditionally, convertible securities
have paid dividends or interest at rates higher than common
stocks but lower than non-convertible securities. They
generally participate in appreciation or depreciation of the
underlying stock into which they are convertible, but to a
lesser degree. Warrants are options to buy a stated number of
shares of common stock at a specified price any time during
the life of the warrants (generally, two or more years).
<PAGE> 67
<PAGE>
The Portfolio may also engage in a variety of investment
management practices, such as buying and selling futures and
options. The Statement of Additional Information contains more
detailed information about these practices.
Maxim INVESCO Small-Cap Growth Portfolio
The investment objective of the Maxim INVESCO Small-Cap
Growth Portfolio is to seek long-term capital growth. The
Portfolio seeks to achieve this objective by investing at
least 65% of assets in a diversified group of equity
securities of emerging growth companies with market
capitalizations of $1 billion or less at the time of initial
purchase ("small-cap companies"). INVESCO Trust Company serves
as sub-adviser to this Portfolio. As such, it is responsible
for the day-to-day management of the Portfolio, subject to the
overall supervision of the Fund's Board of Directors and the
Investment Adviser.
In selecting investments, the Portfolio will seek to
identify small-cap companies that are undervalued in the
marketplace and/or have earnings that may be expected to grow
faster than the U.S. economy in general. Under normal
circumstances, the Portfolio intends to invest at least 65% of
its total assets in equity securities of small-cap companies,
consisting of common and preferred stocks, convertible debt
securities, and other securities having equity features. The
remainder of the Portfolio's assets may be invested in equity
securities of companies with market capitalizations in excess
of $1 billion, debt securities and short-term investments, as
described below.
In selecting the small-cap companies in which the
Portfolio will invest, an attempt will be made to identify
companies in any industry that are thought to have the best
opportunity for capital appreciation within their industry
grouping, subject to the additional requirement that the
companies are determined to be in the developing stages of
their life cycle, and have demonstrated, or are expected to
achieve, long-term earnings growth. In selecting investments
in equity securities of companies with market capitalizations
in excess of $1 billion at the time of initial purchase, the
Portfolio will seek securities that are consistent with the
objective of long-term capital growth. Equity securities
purchased for the Portfolio are traded principally in the
over-the-counter ("OTC") market, although securities traded on
national, regional or foreign stock exchanges may also be
purchased.
The Portfolio may also invest in debt securities
including U.S. Government and corporate debt securities.
Investment in U.S. government securities may consist of
<PAGE> 68
<PAGE>
securities issued or guaranteed by the U.S. Government and any
agency or instrumentality of the U.S. Government. The
Portfolio may invest in both investment grade and lower-rated
corporate debt securities. However, the Portfolio will not
invest more than 5% of its total assets (measured at the time
of purchase) in corporate debt securities that are rated below
BBB by S&P or Baa by Moody's or, if unrated, are securities
judged to be equivalent in quality to debt securities having
such ratings. In no event will the Portfolio invest in a debt
security rated below CCC by S&P or Caa by Moody's.
The short-term investments of the Portfolio may consist
of U.S. government and agency securities, domestic bank
certificates of deposit and bankers' acceptances, and
commercial paper rated A-1 by S&P or P-1 by Moody's, as well
as repurchase agreements with banks and registered broker-
dealers and registered government securities dealers with
respect to the foregoing securities. The Portfolio's assets
invested in U.S. government securities and short-term
investments will be used to maintain liquidity. As well, when
market conditions are believed to warrant such action, the
Portfolio may invest all or a portion of its assets
temporarily in high grade corporate bonds or notes, U.S.
government securities or equity securities of larger, more
established companies, or hold its assets in cash or cash
equivalents, for defensive purposes. While the Portfolio is in
a temporary defensive position, the opportunity to achieve
capital growth will be limited, and, to the extent that this
assessment of market conditions is incorrect, the Portfolio
will be foregoing the opportunity to benefit from capital
growth resulting from increases in the value of equity
investments; however, the ability to maintain a temporary
defensive investment position provides the flexibility for the
Portfolio to seek to avoid capital loss during market down
turns.
The Portfolio may invest in equity securities and
corporate debt obligations which may consist of securities
issued by foreign issuers. Up to 25% of the Portfolio's total
assets, measured at the time of purchase, may be invested
directly in foreign securities. Securities of Canadian issuers
and securities purchased by means of American Depository
Receipts ("ADRs") are not subject to this 25% limitation.
Foreign investments can involve risks, however, that may not
be present in domestic securities. See "Foreign Investment
Risks" in this prospectus.
The Portfolio may make commitments in an amount of up to
10% of the value of its total assets at the time any
commitment is made to purchase or sell securities on a when-
issued or delayed delivery basis (i.e., securities may be
purchased or sold by the Portfolio with settlement taking
<PAGE> 69
<PAGE>
place in the future, often a month or more later). The
Statement of Additional Information contains more detailed
information about these investment practices.
The Portfolio also may invest in securities which are
illiquid because they are subject to restrictions on their
resale ("restricted securities") or because, based upon their
nature or the market for such securities, they are not readily
marketable. Investments in illiquid securities involve certain
risks to the extent that the Portfolio may be unable to
dispose of such a security at the time desired or at a
reasonable price. In addition, in order to resell a restricted
security, the Portfolio might have to bear the expense and
incur the delays associated with effecting registration. See
"Illiquid Securities" in the prospectus.
The Portfolio may purchase and write options on
securities and certain futures contracts and invest in futures
contracts. The Statement of Additional Information contains
more detail about these investment practices.
The portfolio turnover rate for the Portfolio in 1996 was
in excess of 200%. High portfolio turnover rates generally
result in higher transactions costs (which are borne directly
by the Portfolio) and may result in greater tax liability.
Maxim INVESCO ADR Portfolio
The investment objective of the Maxim INVESCO ADR
Portfolio is to achieve a high total return on investment
through capital appreciation and current income, while
reducing risk through diversification. In pursuing this
objective, substantially all of the Portfolio's assets will be
invested in foreign securities that are issued in the form of
American Depository Receipts ("ADRs") or foreign stocks that
are registered with the Securities and Exchange Commission
("SEC") and traded in the U.S. INVESCO Trust Company serves as
sub-adviser to this Portfolio. As such, it is responsible for
the day-to-day management of the Portfolio, subject to the
overall supervision of the Fund's Board of Directors and the
Investment Adviser.
ADRs are negotiable certificates, issued by a U.S.
depository bank, which represent an ownership interest in
shares of non-U.S. companies that are being held by a U.S.
depository bank. Each ADR may represent one ordinary share (or
a fraction or multiple of an ordinary share) on deposit at the
depository bank. The foreign shares held by the depository
bank are known as American Depository Shares (ADSs). Although
there is a technical distinction between ADRs and ADSs, market
participants often use the two terms interchangeably. ADRs are
<PAGE> 70
<PAGE>
traded freely on U.S. exchanges or in the U.S. over-the-
counter market. ADRs can be issued under different types of
ADR programs, and, as a result, some ADRs may not be
registered with the SEC.
The stocks in the ADR Portfolio will be selected from a
universe of approximately 2,200 stocks of large and medium-
sized capitalization, non-U.S. companies for which a computer
database of accounting data has been developed. These stocks
are subjected to a computer analysis that compares the current
stock price to measures such as book value, historical return
on equity, the company's ability to reinvest capital,
dividends and dividend growth. This analysis is based on a
proprietary model developed by the sub-adviser which ranks
securities by relative value.
Once companies with a favorable relative valuation are
identified, they are subject to fundamental analysis by the
sub-adviser to try to determine whether the historical record
that contributed to the favorable ranking can be extended.
Factors considered in this analysis include the company's
business strategy, competitive position and business
environment. Based on this fundamental analysis, the number of
potential investment securities is reduced to form a group of
securities that the sub-adviser uses to build the Portfolio.
The country and industry weightings are a by-product of the
stock selection process.
ADRs are a convenient alternative to direct purchases of
shares on foreign stock exchanges. Although they offer
investment characteristics that are virtually identical to the
underlying ordinary shares, they are often as easy to trade as
stocks of U.S. domiciled companies. A high level of geographic
and industry diversification can be achieved using ADRs, with
all transactions and dividends being in U.S. dollars and
annual reports and shareholder literature printed in English.
On occasion, the sub-adviser may decide that it is economical
to have additional ADRs created or cause a bank to issue ADRs
for companies that have not previously had an ADR facility.
The ADR Portfolio's investment return and the value of
the assets in the Portfolio primarily will be dependent upon
changes in the market value of its equity investments, which
will fluctuate based upon the growth and earnings of the
companies in which it invests, general conditions affecting
the markets for equity securities and exchange rate movements
between the U.S. dollar and overseas currencies. The Portfolio
also may hold cash or cash equivalents to maintain liquidity
or for temporary defensive purposes.
The Portfolio may purchase and write options on
securities and certain futures contracts and invest in futures
<PAGE> 71
<PAGE>
contracts. The Statement of Additional Information contains
more detail about these investment practices.
Foreign investments can involve risks, however, that may
not be present in domestic securities. See "Foreign Investment
Risks" in this prospectus.
Although the Portfolio invests in U.S. dollar denominated
shares of foreign companies, the Portfolio's share value is
affected by changes in currency exchange rates. As one way of
managing exchange rate risk, the Portfolio may enter into
forward foreign currency exchange contracts. See "Foreign
Currency Exchange Transactions" in this prospectus.
Small-Cap Value Portfolio
The investment objective of the Small-Cap Value Portfolio
is to achieve long-term capital appreciation by investing
primarily in common stocks, although the Portfolio may also
invest in other securities, including restricted, preferred
stock or foreign securities. In seeking capital appreciation,
consideration will be given to undervalued small and medium
sized companies in industries that demonstrate a strong
potential for growth, financially strong companies with
distinct market niches offering quality products or services,
outstanding management teams and a proven record of success.
Ariel Capital Management serves as sub-adviser to this
Portfolio. As such, it is responsible for the day-to-day
management of the Portfolio, subject to the overall
supervision of the Fund's Board of Directors and the
Investment Adviser.
As a means of controlling risk, industries that are
believed to be inherently unpredictable specifically,
cyclical, commodity-based and start-up industries will be
avoided. The Portfolio will be constructed on a stock by stock
basis with little attention devoted to the macro-economic
outlook of a particular industry.
The Portfolio will adhere to a disciplined investment
philosophy which incorporates strict guidelines regarding
individual securities. When initiating a position, the
Portfolio will focus on issuers generally ranging in market
capitalization from $50 million to $1.5 billion. As such, the
median market capitalization of the Portfolio is not expected
to exceed $1 billion. Since these companies may be less widely
followed by market analysts, it is believed that they present
greater opportunity for exceptional returns.
<PAGE> 72
<PAGE>
Additionally, in keeping with a value approach, the
Portfolio will generally invest in companies whose equities
are trading at an expected price/earnings ratio of 13-1 or
less over the next 12 months' earnings estimate and at a low
price relative to book value, current sales and total assets.
Expected earnings may represent normalized earnings or be
adjusted for amortization of non-cash charges. When executing
this philosophy, assets of the Portfolio will not trade or
time the market for quick gains. Rather, a fully invested
portfolio is maintained by following a conservative philosophy
of investing for the long-term. A security will be sold if it
is believed that its price/earnings multiple reflects that the
security may be over-valued and/or that it is no longer
perceived as having strong potential for growth. Specifically,
when a stock is trading at a price of 19-20 times its forward
12 months' earnings estimates, it is believed such stock
reflects popular interest. In keeping with a long-term
approach, a security will not be sold because of a short-term
earnings disappointment. However, a holding will be sold if it
is believed that the company's business has undergone
fundamental changes that will negatively affect its stock
price or if there is a loss of faith in a management's ability
to execute the company's stated goals and objectives.
The Portfolio may invest in foreign securities offering
potential for growth. Investments in foreign securities
involve risks that differ in some respects from investment in
securities of U.S. issuers. These risks include the risk of
fluctuations in the value of the currencies in which they are
denominated, the risk of adverse political and economic
developments and, with respect to certain countries, the
possibility of expropriation, nationalization or confiscatory
taxation or limitations on the removal of funds or other
assets of the Portfolio. Securities of some foreign companies
are less liquid and more volatile than securities of
comparable domestic companies. There also may be less publicly
available information about foreign issuers than domestic
issuers, and foreign issuers generally are not subject to the
uniform accounting, auditing and financial reporting
standards, practices and requirements applicable to domestic
issuers. Delays may be encountered in settling securities
transactions in certain foreign markets and the Portfolio will
incur costs in converting foreign currencies to U.S. dollars.
Custody charges are generally higher for foreign securities.
The Portfolio also may invest in money market securities
for temporary or emergency purposes or solely as a cash
reserve. The Portfolio may purchase and write options on
securities and certain futures contracts and invest in certain
futures contracts. The Statement of Additional Information
contains more detail about these investment practices.
<PAGE> 73
<PAGE>
The Portfolio currently observes the following operating
policies, which may be changed without shareholder approval:
(1) the Portfolio actively seeks to invest in companies that
achieve excellence in both financial return and environmental
soundness, selecting issuers that take positive steps toward
preserving our environment and avoiding companies with a poor
environment; and (2) the Portfolio will not invest in issuers
primarily engaged in the manufacture of weapons systems, the
production of nuclear energy, or the manufacture of equipment
to produce nuclear energy.
It is believed that there are long-term benefits inherent
in an investment philosophy that demonstrate concern for the
environment, human rights, economic priorities and
international relations.
The sub-adviser has engaged the services of Franklin
Research and Development Corporation of Boston to provide
environmental screening for all issuers selected for the
Portfolio. Franklin provides information and opinions on the
companies' environmental histories. However, Franklin does not
make recommendations or provide investment advice concerning
the purchase or sale of securities for the Portfolio.
Corporate Bond Portfolio
The investment objective of the Corporate Bond Portfolio
is high total investment return through a combination of
current income and capital appreciation. The Corporate Bond
Portfolio seeks to achieve its investment objective by
investing in debt securities (including convertibles),
although up to 20% of its total assets (measured at the time
of acquisition) may be invested in preferred stocks. In
achieving high total investment returns through a combination
of current income and capital appreciation, the Portfolio will
normally invest at least 65% of its total assets in bonds. A
limited portion of its assets may also be invested in
securities of foreign issuers and up to 35% of its total
assets (measured at the time of acquisition) in securities of
below investment grade quality. The Portfolio may also hold a
portion of its assets in cash or money market instruments.
Loomis, Sayles & Company, L.P. serves as sub-adviser to this
Portfolio. As such, it is responsible for the day-to-day
management of the Portfolio, subject to the overall
supervision of the Fund's Board of Directors and the
Investment Adviser.
The Portfolio may invest in fixed-income securities of
any maturity. Fixed-income securities pay a specified rate of
interest or dividends, or a rate that is adjusted periodically
by reference to some specified index or market rate. Fixed-
income securities include securities issued by federal, state,
<PAGE> 74
<PAGE>
local and foreign governments and related agencies, and by a
wide range of private issuers. Because interest rates vary, it
is impossible to predict the income in fixed-income securities
for any particular period. Therefore, the net asset value of
the Portfolio's shares will vary as a result of changes in the
value of the securities held. Fixed-income securities are
subject to market and credit risk. Market risk relates to
changes in a security's value as a result of changes in
interest rates. In general, the values of fixed-income
securities increase when prevailing interest rates fall and
decrease when interest rates rise. Credit risk relates to the
ability of the issuer to make payments of principal and
interest.
The Portfolio may invest a portion of its assets in
securities rated below investment grade (that is, below BBB by
S&P or Baa by Moody's), including securities in the lowest
rating categories and comparable unrated securities. The
Portfolio may invest up to 35% of its total assets (measured
at the time of acquisition) in such securities. For purposes
of this percentage, a security will be treated as being of
investment grade quality if at the time it is acquired at
least one major rating agency has rated the security in its
top four rating categories (even if another agency has issued
a lower rating), or if the security is unrated but it is
otherwise determined to be of comparable quality. Lower rated
fixed-income securities generally provide higher yields, but
are subject to greater credit and market risk than higher
quality fixed-income securities. Lower rated fixed-income
securities are considered predominately speculative with
respect to the ability of the issuer to meet principal and
interest payments. Achievement of the investment objective of
the Portfolio investing in lower rated fixed-income securities
may be more dependent on credit analysis than is the case with
higher quality bonds. The market for lower rated fixed-income
securities may be more severely affected than some other
financial markets by economic recession or substantial
interest rate increases, by changing public perceptions of
this market or by legislation that limits the ability of
certain categories of financial institutions to invest in
these securities. In addition, the secondary market may be
less liquid for lower rated fixed-income securities. This lack
of liquidity at certain times may affect the values of these
securities and may make the valuation and sale of these
securities more difficult. Securities of below investment
grade quality are commonly referred to as "junk bonds."
Securities in the lowest rating categories may be in poor
standing or in default. Securities in the lowest investment
grade category (BBB by S&P or Baa by Moody's) have some
speculative characteristics.
<PAGE> 75
<PAGE>
The Portfolio also may invest in "zero coupon" fixed-
income securities. These securities accrue interest at a
specified rate, but do not pay interest in cash on a current
basis. If the Portfolio invests in zero coupon securities, it
is required to distribute the income on these securities as
the income accrues, even though the Portfolio is not receiving
the income and cash on a current basis. Thus, the Portfolio
may have to sell other investments to obtain cash to make
income distributions. The market value of zero coupon
securities is often more volatile than that of non-zero coupon
fixed-income securities of comparable quality and maturity.
The Portfolio also may invest in securities of issuers
organized or headquartered outside of the United States. The
Portfolio will not purchase a foreign security if, as a
result, its holdings of foreign securities would exceed 20% of
its total assets (measured at the time of acquisition);
however, the Portfolio may invest any portion of its assets in
securities of Canadian issuers. Foreign investments can
involve risk that may not be present in domestic securities.
See "Foreign Investment Risks" in this prospectus.
The Portfolio may engage in foreign currency exchange
transactions to protect the value of specific positions or in
anticipation of changes in relative values of currencies in
which current or future holdings are denominated or quoted.
See "Foreign Currency Exchange Transactions" in this
prospectus.
The Portfolio may purchase Rule 144A securities. These
are privately offered securities that can be resold only to
certain qualified institutional buyers. Rule 144A securities
are treated as illiquid, unless it has been determined that
the particular issue of Rule 144A securities is liquid. See
"Illiquid Securities" in this prospectus.
The Portfolio may purchase and write options on
securities and certain futures contracts and invest in certain
futures contracts. The Portfolio may also engage in the
following investment practices each of which involves certain
special risks: collateralized mortgage obligations, when-
issued securities and repurchase agreements. The Statement of
Additional Information contains more detailed information
about these practices.
Maxim INVESCO Balanced Portfolio
The Maxim INVESCO Balanced Portfolio (the "Portfolio")
seeks to achieve a high total return on investment through
capital appreciation and current income. The Portfolio
pursues this objective by normally investing 50% to 70% of its
total assets in common stocks, and the remainder in fixed-
<PAGE> 76
<PAGE>
income securities, including money market instruments. At
least 25% of the Portfolio's assets normally will be invested
in fixed income securities issued by the U.S. Government, its
agencies and instrumentalities, or in investment grade
corporate bonds. The capital appreciation component of total
return includes both realized and unrealized appreciation.
There is no guarantee that the Portfolio will meet its
objective.
In selecting equity investments, the Portfolio will seek
to identify companies with better-than-average earnings growth
potential are sought, as well as companies within industries
identified as well-positioned for the current and expected
economic climate. Because current income is a component of
total return, dividend payout records are also considered.
Most of these holdings are traded on national stock exchanges
or in the over-the-counter markets; however, securities traded
on regional or foreign exchanges may also be included in the
Portfolio. In addition to common stocks, the Portfolio also
may hold preferred stocks and securities convertible into
common stock.
For the fixed income portion of the Portfolio's holdings,
obligations of the U.S. Government, its agencies and
instrumentalities, or investment grade corporate bonds are
selected. These securities tend to offer lower income than
bonds of lower quality. Obligations issued by U.S. Government
agencies or instrumentalities may include some supported only
by the credit of the issuer rather than backed by the full
faith and credit of the U.S. Government. The Portfolio may
hold securities of any maturity (from less than one year up to
30 years), with the average maturity varying based upon
economic and market conditions. The Portfolio also may hold
cash and cash equivalent securities as cash reserves.
The amount invested in stocks, bonds and cash equivalent
securities may be varied from time to time depending upon the
assessment of business, economic and market conditions. When
it is believed conditions are adverse, the Portfolio may
assume a defensive position by temporarily investing up to
100% of its assets in U.S. Government and agency securities,
investment grade corporate bonds, or cash equivalent
securities, such as domestic certificates of deposit and
bankers' acceptances, commercial paper and repurchase
agreements, in an attempt to protect principal value until
conditions stabilize.
Up to 25% of the Portfolio's total assets, measured at
the time of purchase, may be invested directly in foreign
equity or corporate debt securities. Securities of Canadian
issuers and American Depository Receipts ("ADRs") are not
subject to this 25% limitation. ADRs are receipts
<PAGE> 77
<PAGE>
representing shares of a foreign corporation held by a U.S.
bank that entitle the holder to all dividends and capital
gains. ADRs are denominated in U.S. dollars and trade in the
U.S. securities markets. Please see "Foreign Investment
Risks" in this prospectus for more information concerning
these securities and their risks.
The Portfolio may purchase and write options on
securities and may invest in futures contracts for the
purchase or sale of foreign currencies, fixed income
securities and instruments based on financial indices
(collectively, "futures contracts"), options on futures
contracts and forward contracts for hedging purposes only.
These practices and their risks are discussed in the Statement
of Additional Information. Please also see "Foreign Currency
Exchange Transactions" in this prospectus.
Index Portfolio Management
All index styled portfolios may utilize futures as a
substitute for a comparable market position in the underlying
securities, or for hedging purposes. A stock 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 stock
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 stocks in the index is made. The intent is
to purchase and sell futures contracts so as to obtain the
best price with consideration also given to liquidity.
Stock index futures contracts may be purchased or sold to
the extent that such activities would be consistent with the
requirements of Section 4.5 of the regulations under the
Commodity Exchange Act, under which the portfolios would be
excluded from the definition of a "commodity pool operator."
Accordingly, each portfolio may enter into futures positions
in such futures contracts to the extent that the aggregate
initial margins and premiums required to establish such
positions do not exceed 5% of the liquidation value of the
respective portfolio.
Risks associated with the use of futures contracts are:
(i) imperfect correlation between the change in value of
securities included on the index and the prices of futures
contracts; and (ii) possible lack of a liquid secondary market
for a futures position when desired. The risk that a portfolio
<PAGE> 78
<PAGE>
will be unable to close out a futures position will be
minimized by entering into such transactions on a national
exchange with an active and liquid secondary market. In
addition, because of the low margin deposits normally required
in futures trading, a high degree of leverage is typical of a
futures trading account. As a result, a relatively small price
movement in a futures contract may result in substantial
losses to the trader (i.e., the Portfolio).
Traditional methods of securities analysis are not used
by the Investment Adviser in making investment decisions for
index styled portfolios. Rather a statistical selection
technique is utilized to determine which securities it will
purchase or sell in order to track the performance of the
relevant index(es) to the extent feasible. In addition, from
time to time, adjustments may be made in a portfolio's
holdings due to change in the composition of the relevant
index(es). Each index styled portfolio will attempt to achieve
a correlation between its performance and that of the relevant
index(es) of at least 0.95, without taking into account
expenses. A correlation of 1.00 would indicate perfect
correlation, which would be achieved when a portfolio's net
asset value, including the value of its dividends and capital
gains distributions, increases or decreases, is in exact
proportion to change in the relevant index(es). The Investment
Adviser will attempt to minimize any "tracing error" (that
statistical measure of the difference between the investment
results of a portfolio and that of the relevant index(es)) in
making investments for a portfolio. However, brokerage and
other transaction costs, as well as potential tracking errors,
will tend to cause a portfolio's return to be lower than the
return of the relevant index(es). There can be no assurance,
however, as to how closely a portfolio's performance will
correspond to the performance of the relevant index(es).
Moreover, the index itself may not perform favorably in which
case a Portfolio's performance would similarly be unfavorable.
Foreign Investment Risks
Investments in foreign securities present risks not
typically associated with investments in comparable securities
of U.S. issuers. Since foreign securities involve foreign
currencies, the value of the assets of a Portfolio and its net
investment income available for distribution may be affected
favorably or unfavorably by changes in currency exchange rates
and exchange control regulations. Investment will not be made
in securities denominated in a foreign currency that is not
fully exchangeable into U.S. dollars without legal restriction
at the time of investment.
There may be less information publicly available about a
foreign corporate or government issuer than about a U.S.
issuer, and foreign corporate issuers generally are not
<PAGE> 79
<PAGE>
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.
A Portfolio'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.
In determining whether to invest in securities of foreign
issuers, the likely impact of foreign taxes on the net yield
available may be considered. Income received from sources
within foreign countries and the U.S. may reduce or eliminate
such taxes. It is impossible to determine the effective rate
of foreign tax in advance since the amount of assets to be
invested in various countries is not known, and tax laws and
their interpretations may change from time to time and may
change without advance notice. While attempts will be made to
minimize such taxes by timing of transactions and other
strategies, there is no assurance that such efforts will be
successful. Any such taxes paid will reduce net income
available for distribution.
Most foreign securities in a Portfolio (other than ADRs)
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 a Portfolio in foreign currencies. With
respect to all Portfolios, the value of foreign currencies
relative to the U.S. dollar varies continually, causing
changes in the dollar value of a Portfolio's investments (even
if the price of the investments is unchanged) and changes in
the dollar value of a Portfolio's income available for
<PAGE> 80
<PAGE>
distribution to its shareholders. The effect of changes in the
dollar value of a foreign currency on the dollar value of a
Portfolio's assets and on the net investment income available
for distribution may be favorable or unfavorable.
For Portfolios other than the Maxim INVESCO ADR
Portfolio, a Portfolio may incur costs in connection with
conversions between various currencies. In addition, a
Portfolio 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 a Portfolio declares and pays
a dividend, or between the time when a Portfolio accrues and
pays an operating expense in U.S. dollars.
The Maxim INVESCO ADR Portfolio may invest in ADRs. ADRs
are receipts, typically issued by a U.S. bank or trust
company, evidencing ownership of the underlying foreign
securities. ADRs are denominated in U.S. dollars and trade in
the U.S. securities markets. ADRs may be issued in sponsored
or unsponsored programs. In sponsored programs, the issuer
makes arrangements to have its securities traded in the form
of ADRs; in unsponsored programs, the issuer may not be
directly involved in the creation of the program. Although the
regulatory requirements with respect to sponsored and
unsponsored programs are generally similar, the issuers of
unsponsored ADRs are not obligated to disclose material
information in the United States and, therefore, such
information may not be reflected in the market value of the
ADRs. ADRs are subject to certain of the same risks as direct
investments in foreign securities, including the risk that
changes in the value of the currency in which the security
underlying an ADR is denominated relative to the U.S. dollar
may adversely affect the value of the ADR.
Foreign Currency Exchange Transactions
Portfolios which engage in foreign currency exchange
transactions do so in an attempt to protect against
uncertainty in the level of future exchange rates. Some
Portfolios 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.")
A Portfolio may engage in transaction hedging to protect
against a change in foreign currency exchange rates between
the date on which the Portfolio contracts to purchase or sell
a security and the settlement date, or to "lock in" the U.S.
<PAGE> 81
<PAGE>
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, a Portfolio 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 a Portfolio may also
purchase or sell exchange-listed and over-the-counter call and
put options on foreign currency futures contracts and on
foreign currencies.
A Portfolio 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, quoted or exposed (or an increase in the value of
the currency in which the securities the Portfolio intends to
buy are denominated, when the Portfolio holds cash or short-
term investments). For position hedging purposes, a Portfolio
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, the Portfolio also may purchase or sell
foreign currency on a spot basis.
A Portfolio'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. A
Portfolio could hedge a foreign currency with forward
contracts on another ("proxy") currency of which changes in
value generally correlate with the currency to be hedged. Such
"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.
<PAGE> 82
<PAGE>
Hedging transactions involve costs and may result in
losses. A Portfolio 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 denominated. Hedging transactions also may be limited
by tax considerations. Hedging transactions may affect the
character or amount of distributions.
Illiquid Securities
Each Portfolio, other than the Money Market Portfolio,
may invest up to 15% of its total assets in "illiquid
securities" (taken as of the time of acquisition of an
illiquid security). The Money Market Portfolio may invest up
to 10% of its total assets in illiquid securities. Illiquid
securities are securities that may not be sold in the ordinary
course of business within seven days at approximately the
price used in determining the net asset value of the
Portfolio. This restriction applies to securities for which a
ready market does not exist, such as restricted securities,
but does not necessarily encompass all restricted securities.
Institutional markets for restricted securities have developed
as a result of the promulgation of Rule 144A under the
Securities Act of 1933 which provides a "safe harbor" from
1933 Act registration requirements for qualifying sales to
institutional investors. When Rule 144A securities present an
attractive investment opportunity and otherwise meet selection
criteria, the Portfolios may make such investments. Whether or
not such securities are "illiquid" depends on the market that
exists for the particular security.
The staff of the Securities and Exchange Commission has
taken the position that the liquidity of Rule 144A securities
is a question of fact for a board of directors to determine,
such determination is to be based on a consideration of the
readily available trading markets and the review of any
contractual restrictions. The staff also acknowledges that
while the board retains ultimate responsibility, it may
delegate this function to an investment adviser. The Board of
Directors of the Fund has delegated this responsibility to the
Investment Adviser, and with respect to those Portfolios
having a sub-adviser, the sub-adviser is responsible for
determining the liquidity of Rule 144A securities.
It is not possible to predict with assurance exactly how
the market for Rule 144A securities or any other security will
develop. A security which when purchased enjoyed a fair degree
<PAGE> 83
<PAGE>
of marketability may subsequently become illiquid and,
accordingly, a security which was deemed to be liquid at the
time of acquisition may subsequently become illiquid. In such
event, appropriate remedies will be considered to minimize the
effect on a Portfolio's liquidity.
Debt Securities
Bonds and other debt instruments are used by issuers to
borrow money from investors. The issuer pays the investor a
fixed or variable rate of interest, and must repay the amount
borrowed at maturity. Some debt securities, such as zero-
coupon bonds, do not pay current interest, but are purchased
at a discount from their face values. In general, bond prices
rise when interest rates fall, and vice versa. Debt securities
have varying degrees of quality and varying levels of
sensitivity to changes in interest rates. Longer-term bonds
are generally more sensitive to interest rate changes than
short-term bonds. This sensitivity to interest rates is also
referred to as "market risk."
Debt obligations are rated based on their estimated
credit risk by independent services such as S&P and Moody's.
"Credit risk" relates to the issuer's ability to make payments
of principal and interest when due.
The lower a bond's quality, the more it is subject to
credit risk and market risk and the more speculative it
becomes. Investment grade securities are those rated AAA, AA,
A or BBB by S&P or Aaa, Aa, A or Baa by Moody's or, if
unrated, are judged to be of comparable quality to securities
so rated. Debt securities rated BBB by S&P or Baa by Moody's
and unrated securities of comparable quality are viewed as
having adequate capacity for payment of principal and
interest, but do involve a higher degree of risk than that
associated with investments in debt securities in the higher
rating categories.
Securities rated below investment grade are commonly
referred to as "high yield-high risk securities" or "junk
bonds". These securities are considered speculative with
respect to the issuer's capacity to pay interest and repay
principal in accordance with the terms of the obligations. It
is, therefore, possible that these types of factors could in
certain instances, reduce the value of securities held with a
commensurate effect on share value.
Debt securities include (1) securities issued or
guaranteed as to principal or interest by the U.S. Government,
its agencies or instrumentalities; (2) debt securities issued
or guaranteed by U.S. corporations or other issuers (including
foreign governments or corporations); (3) asset-backed
<PAGE> 84
<PAGE>
securities and mortgage-related securities, including
collateralized mortgage obligations ("CMOs"); and (4)
securities issued or guaranteed as to principal or interest by
a sovereign government or one of its agencies or political
subdivisions, supranational entities such as development
banks, non-U.S. corporations, banks or bank holding companies,
or other non-U.S. issuers.
MANAGEMENT OF THE FUND
Overall responsibility for management and supervision of
the Fund rests with the Fund's directors. There currently are
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 meets regularly four times each
year and at other times as necessary. By virtue of the
functions performed by GW Capital Management as Investment
Adviser, 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 GW
Capital Management 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.
Investment Adviser
GW Capital Management, 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, the Investment Adviser is controlled by a
Canadian investor, Paul Desmarais, and his associates. The
Investment Adviser 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. GW Capital Management is a
registered investment adviser with the Securities and Exchange
Commission.
Subject to the supervision and direction of the Fund's
Board of Directors, the Investment Adviser manages the Fund's
portfolios in accordance with each Portfolio's stated
investment objectives and policies, makes investment decisions
for the Portfolios and places orders to buy and sell
securities on behalf of the Fund or delegates these functions
to a sub-adviser, as discussed below. The Investment Adviser
provides investment advisory services and pays all the
expenses, except extraordinary expenses, incurred for
providing such services for the Portfolios described herein.
As compensation for its services to the Fund, the Investment
Adviser receives monthly compensation at the annual rate of
<PAGE> 85
<PAGE>
0.46% of the average daily net assets of the Money Market
Portfolio; 0.60% of the average daily net assets of the Bond,
Stock Index, U.S. Government Securities, Total Return
Portfolio, Small-Cap Index Portfolios; 0.80% of the average
daily net assets of the Maxim T. Rowe Price Equity/Income
Portfolio; 0.90% of the average daily net assets of the
Corporate Bond Portfolio; 0.95% of the average daily net
assets of the MidCap and Maxim INVESCO Small-Cap Growth
Portfolios; and 1.00% of the average daily net assets of the
Small-Cap Value, International Equity, Maxim INVESCO ADR and
Maxim INVESCO Balanced Portfolios.
With respect to the MidCap, International Equity, Small-
Cap Value, Maxim T. Rowe Price Equity/Income, Maxim INVESCO
Small-Cap Growth and Maxim INVESCO ADR Portfolios, the
Investment Adviser pays all compensation of, and furnishes
office space for, officers and employees of the Investment
Adviser connected with investment management of these
Portfolios, as well as the fees of all directors of the Fund
who are affiliated persons of the Investment Adviser or any of
its subsidiaries. All other expenses incurred in the operation
of these Portfolios, including general administrative
expenses, are borne by these Portfolios, respectively.
Accounting services are provided for these Portfolios by the
Investment Adviser and these Portfolios reimburse the Adviser
for its costs in connection with such services. However, the
Adviser has agreed to pay any expenses of the Fund which
exceed an annual rate of 0.95% of the average daily net assets
of the Maxim T. Rowe Price Equity/Income Portfolio; 1.10% of
the average daily net assets of the MidCap and Maxim INVESCO
Small-Cap Growth Portfolios; 1.30% of the average daily net
assets of the Maxim Invesco ADR Portfolio; 1.35% of the
average daily net assets of the Small-Cap Value Portfolio;
and, 1.50% of the average daily net assets of the
International Equity Portfolio.
The day-to-day lead portfolio manager for the Bond
Portfolio is B.G. Masters. Mr. Masters is Manager, Public Bond
Investments, Great-West, 1993 to Present; Manager, Bond,
Investment Grade Corporate Bond and Short-Term Maturity Bond
Portfolios of Maxim Series Fund, June 1994 to Present. He was
Assistant Manager, Public Bond Investments, Great-West, 1987
to 1993.
The day-to-day lead portfolio manager for the U.S.
Government Securities Portfolio is C.S. Tocher. Ms. Tocher is
Manager, Public Bond Investments, Securities Great-West, 1993
to Present; Manager, U.S. Government Securities and U.S.
Government Mortgage Securities Portfolio of Maxim Series Fund;
June 1994 to Present. She was Associate Manager, Public Bond
Investments, Great-West, 1990 to 1993; Manager, Bond,
<PAGE> 86
<PAGE>
Investment Grade Corporate Bond and Zero Coupon Treasury
Portfolios of Maxim Series Fund, 1990 to June 1994.
The day-to-day lead portfolio manager for the Total
Return Portfolio is B.D. Squair, C.F.A., Assistant Manager,
Capital Markets Group, Great-West; Manager, Total Return
Portfolio of Maxim Series Fund; Manager, Great-West Variable
Annuity Account A; 1988 to Present.
Sub-Advisers
Janus Capital Corporation ("Janus") serves as the
Sub-Adviser to the MidCap Portfolio. As such, Janus is
responsible for daily managing the investment and reinvestment
of assets of the MidCap Portfolio, subject generally to review
and supervision of the Investment Adviser and the Board of
Directors. Janus bears all expenses in connection with the
performance of its services, such as compensating and
furnishing office space for its officers and employees
connected with investment and economic research, trading and
investment management of the MidCap Portfolio.
Janus is a Colorado corporation, registered as an
investment adviser with the Securities and Exchange
Commission. Its principal business address is 100 Fillmore
Street, Denver, Colorado 80206.
The day-to-day manager of the MidCap Portfolio is James
P. Goff, Portfolio Manager for the Janus Enterprise Fund. Mr.
Goff joined Janus in 1988 and has managed the Janus Enterprise
Fund since its inception in September 1992.
The Investment Adviser is responsible for compensating
Janus, which receives monthly compensation from the Investment
Adviser at the annual rate of .60% on the first $100 million;
.55% on next $400 million; and .45% on all assets over $500
million.
Templeton Investment Counsel, Inc. ("TICI") serves as the
Sub-Adviser of the International Equity Portfolio. As such,
TICI is responsible for daily managing the investment and
reinvestment of assets of the International Equity Portfolio,
subject generally to review and supervision of the Investment
Adviser and the Board of Directors.
TICI bears all expenses in connection with the
performance of its services, such as compensating and
furnishing office space for its officers and employees
connected with investment and economic research, trading and
investment management of the International Equity Portfolio.
<PAGE> 87
<PAGE>
The day-to-day manager of the International Equity
Portfolio is Mark Beveridge, Senior Vice President, TICI
(since 1985).
TICI is an indirect subsidiary of Templeton Worldwide,
Inc., which in turn is a direct, wholly-owned subsidiary of
Franklin Resources, Inc. TICI is a Florida corporation with
its principal business address at Broward Financial Centre,
500 East Broward Boulevard, Suite 2100, Fort Lauderdale,
Florida 33394.
The Investment Adviser is responsible for compensating
TICI, which receives monthly compensation from the Investment
Adviser at the annual rate of .70% on the first $25 million,
.55% on the next $25 million, .50% on the next $50 million,
and .40% on all amounts over $100 million.
T. Rowe Price Associates, Inc. ("T. Rowe Price") serves
as the sub-adviser to the Maxim T. Rowe Price Equity/Income
Portfolio. As such, T. Rowe Price is responsible for daily
managing the investment and reinvestment of assets of the
Portfolio, subject generally to review and supervision of the
Investment Adviser and the Board of Directors. T. Rowe Price
bears all expenses in connection with the performance of its
services, such as compensating and furnishing office space for
its officers and employees connected with the investment and
economic research, trading and investment management of the
Maxim T. Rowe Price Equity/Income Portfolio.
T. Rowe Price is a Maryland corporation, registered as an
investment adviser with the Securities and Exchange
Commission. Its principal business address is 100 East Pratt
Street, Baltimore, Maryland 21202.
The Maxim T. Rowe Price Equity/Income Portfolio is
managed by an Investment Advisory Committee composed of the
following members: Brian C. Rogers, Chairman, Thomas H.
Broadus, Jr., Richard P. Howard and William J. Stromberg. The
Committee Chairman has day-to-day responsibility for managing
the Portfolio. Mr. Rogers has been Chairman of the Committee
since 1993. He joined T. Rowe Price in 1982 and has been
managing investments since 1983.
The Investment Adviser is responsible for compensating T.
Rowe Price, which receives monthly compensation from the
Investment Adviser at the annual rate of .50% on the first $20
million, .40% on the next $30 million and .40% on all assets
once total assets exceed $50 million.
INVESCO Trust Company ("ITC") serves as the sub-adviser
to the Maxim INVESCO Small-Cap Growth Portfolio, Maxim INVESCO
Balanced Portfolio and Maxim INVESCO ADR Portfolio. As such,
<PAGE> 88
<PAGE>
ITC is responsible for daily managing the investment and
reinvestment of assets of the Maxim INVESCO Small Cap Growth,
Maxim INVESCO Balanced and Maxim INVESCO ADR Portfolios,
subject generally to review and supervision of the Investment
Adviser and the Board of Directors. ITC bears all expenses in
connection with the performance of its services, such as
compensating and furnishing office space for its officers and
employees connected with investment and economic research,
trading and investment management of the Portfolios.
ITC is a Colorado Trust Company and an indirect wholly-
owned subsidiary of AMVESCO PLC. ITC is registered as an
Investment Adviser with the Securities and Exchange
Commission. Its principal business address is 7800 E. Union
Avenue, Denver, Colorado, 80237.
The day-to-day management of the Maxim INVESCO Small-Cap
Growth Portfolio is provided by a team of individuals, led by
Timothy J. Miller (since 1997). Mr. Miller also serves as the
co-portfolio manager of the INVESCO Small Company Growth Fund
(since 1997); co-portfolio manager of the INVESCO Growth Fund
(since 1996); portfolio manager of the INVESCO Dynamics Fund
(since 1993); senior vice president (1995 to present), vice
president (1993-1995) and portfolio manager (1992 to present)
of ITC. Formerly (1979 to 1992), Mr. Miller was analyst and
portfolio manager with Mississippi Valley Advisors. Trent E.
May is a co-portfolio manager of the Maxim INVESCO Small-Cap
Growth Portfolio and INVESCO Small Company Growth Fund (since
1997); co-portfolio manager of the INVESCO Growth Fund (since
1996); portfolio manager (since 1996) of ITC. Formerly, Mr.
May was senior equity fund manager/equity analyst at Munder
Capital Management in Detroit. Stacie Cowell is a co-portfolio
manager of the Maxim INVESCO Small-Cap Growth Portfolio and
INVESCO Small Company Growth Fund (since 1997); portfolio
manager (since 1996) of ITC. Formerly, Ms. Cowell was senior
equity analyst with Founders Asset Management; and was capital
markets and trading analyst with Chase Manhattan Bank in New
York.
The Investment Adviser is responsible for compensating
ITC, which receives monthly compensation from the Investment
Adviser at the annual rate of .55% on the first $25 million,
.50% on the next $50 million, .40% on the next $25 million and
.35% on assets over $100 million of the Maxim INVESCO Small-
Cap Growth Portfolio.
Donovan J. (Jerry) Paul, Charles P. Mayer and Albert M.
Grossi are co-portfolio managers for the Maxim INVESCO
Balanced Portfolio. Mr. Mayer is primarily responsible for the
day-to-day management of the Portfolio's equity holdings. He
is also the co-portfolio manager for the INVESCO Balanced
Fund, since 1996. Mr. Mayer is also co-portfolio manager of
<PAGE> 89
<PAGE>
the INVESCO Industrial Income Fund, Inc. and INVESCO VIF-
Industrial Income Fund. Mr. Mayer began his investment career
in 1969 and is now senior vice president and director of
INVESCO Trust and a director of INVESCO Funds Group, Inc.;
from 1993 to 1994, he was a vice president of INVESCO Trust.
From 1984 to 1993, he was a portfolio manager with
Westinghouse Pension. Mr. Paul focuses on the fixed income
investments for the Portfolio. Since 1994, he has also served
as co-portfolio manager for the INVESCO Balanced Portfolio;
portfolio manager of INVESCO Select Income Fund, INVESCO High
Yield Fund, and INVESCO VIF-High Yield Portfolio; co-portfolio
manager of INVESCO Industrial Income Fund and INVESCO VIF-
Industrial Income Fund; portfolio manager and senior vice
president of ITC. Formerly, Mr. Paul was Senior Vice
President and Director of Fixed-Income Research (1989 to 1992)
and portfolio manager (1987 to 1992) with Stein, Roe and
Farnham Inc., and President (1993 to 1994) of Quixote
Investment Management, Inc. Mr. Grossi has served as co-
portfolio manager of the INVESCO Balanced Fund since 1996. He
is also the portfolio manager of INVESCO Worldwide Capital
Goods Fund. Mr. Grossi began his investment career in 1944
and is now a vice president of INVESCO Trust. Formerly, Mr.
Grossi was a portfolio manager for Westinghouse Pension
Investments Corporation.
The Investment Adviser is responsible for compensating
ITC, which receives monthly compensation from the Investment
Adviser at the annual rate of .50% of the average daily net
assets of the Portfolio up to $25 million, .45% on the next
$50 million, .40% on the next $25 million and .35% of such
value in excess of $100 million of the Maxim INVESCO Balanced
Portfolio.
The day-to-day manager of the Maxim INVESCO ADR Portfolio
is W. Lindsay Davidson, who also serves as portfolio manager
for the INVESCO ADR International Equity Management Fund. Mr.
Davidson has been with INVESCO PLC since 1984 and in 1989 he
assumed responsibility for global and international
portfolios. Mr. Davidson began his investment career in 1974
and previously worked for both insurance and reinsurance
companies in England. He holds an M.A. (Honours) degree in
Economics from Edinburgh University.
The Investment Adviser is responsible for compensating
ITC, which receives monthly compensation from the Investment
Adviser at the annual rate of .55% on the first $50 million,
.50% on the next $50 million, and .40% on assets over $100
million of the Maxim INVESCO ADR Portfolio.
Ariel Capital Management, Inc. (Ariel) is a privately
held minority-owned money manager registered with the
Securities and Exchange Commission as an investment adviser.
<PAGE> 90
<PAGE>
It is an Illinois corporation with its principal business
address at 307 North Michigan Avenue, Chicago, Illinois 60601.
Subject generally to review and supervision by the Investment
Adviser and the Board of Directors of the Fund, Ariel is
responsible for the actual daily management of the Small-Cap
Value Portfolio and for making decisions to buy, sell or hold
any particular security.
Ariel bears all expenses in connection with the
performance of its services, such as compensating and
furnishing office space for its officers and employees
connected with investment and economic research, trading and
investment management of the Small-Cap Value Portfolio.
The day-to-day manager for the Small-Cap Value Portfolio
is John W. Rogers, Jr. Mr. Rogers' business experience during
the past five years is as Chief Investment Officer, Ariel
Capital Management and Portfolio Manager, Calvert-Ariel Growth
Fund.
The Investment Adviser is responsible for compensating
Ariel, which receives monthly compensation from the Investment
Adviser at the annual rate of .40% of the average daily net
asset value of the Small-Cap Value Portfolio up to $5 million,
.35% on the next $10 million, .30% on the next $10 million,
and .25% of such value in excess of $25 million.
Loomis, Sayles & Company, L.P. ("Loomis Sayles") is the
sub-adviser of the Corporate Bond Portfolio. As such, Loomis
Sayles is responsible for daily managing the investment and
reinvestment of assets of the Portfolios, subject generally to
review and supervision of the Investment Adviser and the Board
of Directors. Loomis Sayles bears all expenses in connection
with the performance of its services, such as compensating and
furnishing office space for its officers and employees
connected with the investment and economic research, trading
and investment management of the Portfolio.
Loomis Sayles is a Delaware limited partnership,
registered as an investment adviser with the Securities and
Exchange Commission. Its principal business address is One
Financial Center, Boston, Massachusetts 02111.
The day-to-day manager of the Corporate Bond Portfolio is
Daniel J. Fuss, Executive Vice President of Loomis Sayles who
also serves as the fund manager of the Loomis Sayles Bond
Fund. Mr. Fuss has served as the portfolio manager of the
Loomis Sayles Bond Fund since its inception in 1991.
The Investment Adviser is responsible for compensating
Loomis Sayles, which receives monthly compensation from the
<PAGE> 91
<PAGE>
Investment Adviser at the annual rate of .30% on all assets of
the Corporate Bond Portfolio.
The Board of Directors has authorized each sub-adviser to
utilize certain brokers affiliated with the sub-advisers,
respectively, in connection with the execution of transactions
in the Portfolios for which the sub-adviser provides sub-
advisory services.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Dividends from investment income of the Money Market
Portfolio shall be declared daily and reinvested monthly in
additional shares of the Portfolio at net asset value.
Dividends from net investment income of the Bond and U.S.
Government Securities Portfolios shall be declared and
reinvested quarterly. Dividends from investment income, if
any, of the Stock Index, Small-Cap Index, Small-Cap Value,
Total Return, MidCap, Maxim T. Rowe Price Equity/Income, Maxim
INVESCO Balanced and Maxim INVESCO Small-Cap Growth Portfolios
will be declared and reinvested semi-annually. Dividends from
net investment income of the International Equity and Maxim
INVESCO ADR Portfolios shall be declared and reinvested
annually. Distributions of net realized capital gains, if any,
are declared in the fiscal year in which they have been earned
and are reinvested in additional shares of the Fund 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 the Series
Accounts of GWL&A and MetLife. 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/MetLife and the
Series Accounts, see "Federal Tax Considerations" included in
the applicable Series Account prospectus.
PURCHASE AND REDEMPTION OF SHARES
<PAGE> 92
<PAGE>
Shares of the Fund are sold and redeemed at their net
asset value next determined after initial receipt of a
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 once daily Monday through Friday, except
on holidays on which the New York Stock Exchange is closed.
Net asset value of a portfolio share is computed by
dividing the value of the net assets of the portfolio by the
total number of portfolio shares outstanding. Portfolio
securities that are listed on an established securities
exchange or on the NASDAQ National Market System are valued at
the last sale price as of the close of business on the day the
securities are being valued, or, lacking any sales, at the
mean between closing bid and asked price. Securities traded in
the over-the-counter market are valued at the mean between the
bid and asked prices or yield equivalent as obtained from one
or more dealers that make markets in the securities. Portfolio
securities that are traded both in the over-the-counter market
and on an exchange are valued according to the broadest and
most representative market. Securities and assets for which
market quotations are not readily available are valued at fair
value as determined in good faith by or under the direction of
the Board of Directors, including valuations furnished by a
pricing service that may be retained by the Fund.
Market quotations of foreign securities in foreign
currency are translated to U.S. dollars at the prevailing rate
of exchange. Securities for which market quotations are not
readily available, and other assets, are valued at fair value
as determined in good faith by the Board of Directors. Such a
determination may take into account, for example, quotations
by dealers or issuers for securities of similar type, quality,
and maturity, or valuations furnished by a pricing service
retained by the Fund.
Money market securities held by the Fund with 60 days or
less remaining to maturity are valued on an amortized cost
basis, which involves valuing a portfolio instrument at its
cost initially and thereafter assuming a constant amortization
to maturity of any discount or premium, regardless of the
impact of fluctuating interest rates on the market value of
the instrument. While this method provides certainty in
valuation, it may result in periods during which value, as
<PAGE> 93
<PAGE>
determined by amortized cost, is higher or lower than the
price the Fund would receive if it sold the security.
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 an 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 of MetLife, and
The Great-West Life Assurance Company, which provided the
Fund's initial capitalization, will be holders of the shares
and be entitled to exercise the rights directly as described
in the applicable Series Account prospectus.
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.
PERFORMANCE RELATED INFORMATION
The Fund may advertise certain performance related
information. Performance information about the Fund is based
on the Fund'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 Portfolios. When the Fund
<PAGE> 94
<PAGE>
advertises the total return of one of these portfolios, it
will usually be calculated for one year, five years, and ten
years or some other relevant period if the Fund has 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).
Some of the Portfolios also may advertise their 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 Fund share
(reduced by any dividend expected to be paid shortly out of
Fund income) on the last day of the period.
The Money Market Portfolio may advertise its yield and
effective yield. The yield of the Money Market Portfolio is
based upon the income earned by the Portfolio over a seven-day
period and then annualized, i.e., the income earned in the
period is assumed to be earned every seven days over a 52-week
period and stated as a percentage of the investment. Effective
yield is calculated similarly but, when annualized, the income
earned by the investment is assumed to be reinvested in
portfolio shares and thus compounded in the course of a
52-week period.
YIELDS
Yield (and effective yield, in the case of the Money Market
Portfolio) will fluctuate, and publication of yield
information may not provide a basis for comparison with bank
deposits, securities of other investment companies or other
investments which are insured and/or pay a fixed yield for a
stated period of time. In addition, the yield and effective
yield information may be of limited use for comparative
purposes because it does not reflect charges imposed at the
Series Account level which, if included, would decrease the
yield. Moreover, the yields shown reflect past performance of
the Portfolios only and, as such, are not intended to
indicate, predict or guarantee future performance.
<TABLE>
<CAPTION>
Yield**
Effective Yield**
<S> <C> <C>
MONEY MARKET PORTFOLIO 4.95% 5.08%
Comparison Information (1) 5.02%
BOND PORTFOLIO 6.12%
STOCK INDEX PORTFOLIO 1.48%
U.S. GOVERNMENT SECURITIES PORTFOLIO 7.91%
TOTAL RETURN PORTFOLIO 2.57%
<PAGE> 95
<PAGE>
SMALL-CAP INDEX PORTFOLIO 1.54%
INTERNATIONAL EQUITY PORTFOLIO -0.67%
MIDCAP PORTFOLIO -1.08%
MAXIM T. ROWE PRICE
EQUITY/INCOME PORTFOLIO 2.56%
MAXIM INVESCO SMALL-CAP
GROWTH PORTFOLIO 0.68%
MAXIM INVESCO ADR PORTFOLIO 0.65%
SMALL-CAP VALUE PORTFOLIO 1.78%
CORPORATE BOND PORTFOLIO 7.31%
MAXIM INVESCO BALANCED PORTFOLIO 2.75%
</TABLE>
**Yield and effective yield for the Money Market Portfolio is
for the 7-day period ended December 31,1996. Yield for the
other Portfolios is for the month ended December 31,1996. All
the yield and effective yield calculations above take into
account charges against the Portfolio. All yield and effective
yield information is annualized.
(1) The Donoghue MONEY FUND AVERAGE lists 772 taxable money
funds that are available to individual investors.
TOTAL RETURNS
All total return calculations assume the full redemption
of the Portfolio at the end of the period for which the
calculation was made. These returns also reflect annual
returns over the period indicated. For information on the
method used to calculate the above returns see the Statement
of Additional Information. The performance shown reflects only
past performance of the Portfolios and is not intended to be
an indication, prediction or guarantee of future performance.
Total return information, however, may be of limited use for
comparative purposes because it does not reflect charges
imposed at the Series Account level which, if included, would
decrease the total return.
<TABLE>
<CAPTION>
One Five Ten Since
Year Year Year Inception+++
<S> <C> <C> <C> <C>
BOND PORTFOLIO 4.26% 6.23% 7.48%
Comparison Information (2) 4.05% 6.53% 7.91%
STOCK INDEX PORTFOLIO+ 21.81% 13.98% 12.99%
Comparison Information (3) 22.96% 15.22% 15.29%
U.S. GOVERNMENT
SECURITIES PORTFOLIO++ 3.92% 6.83% 8.16%
Comparison Information (7) 5.35% 6.71% 8.78%
<PAGE> 96
<PAGE>
TOTAL RETURN PORTFOLIO 11.76% 9.56% N/A 9.37%
Comparison Information (4) 13.01% 11.13% 11.19%
SMALL-CAP INDEX PORTFOLIO 15.30% N/A N/A 11.64%
Comparison Information (5) 16.49% 15.64% 12.41%
INTERNATIONAL EQUITY
PORTFOLIO 19.59% N/A N/A 11.48%
Comparison Information (6) 6.36% 8.48% 8.74%
MIDCAP PORTFOLIO 5.96% N/A N/A 14.11%
Comparison Information (9) 19.20% 13.93% 15.94%
MAXIM T. ROWE PRICE
EQUITY/INCOME PORTFOLIO 19.39% N/A N/A 23.20%
Comparison Information (3) 22.96% 15.22% 15.29%
MAXIM INVESCO SMALL-
CAP GROWTH PORTFOLIO 26.74% N/A N/A 27.20%
Comparison Information (5) 16.49% 15.64% 15.94%
MAXIM INVESCO
ADR PORTFOLIO 21.17% N/A N/A 16.15%
Comparison Information (6) 6.36% 8.48% 8.74%
SMALL-CAP VALUE PORTFOLIO 17.95% N/A N/A 10.74%
Comparison Information (3) 22.96% 15.22% 15.29%
CORPORATE BOND PORTFOLIO 10.37% N/A N/A 17.39%
Comparison Information (8) 2.91% 7.23%
MAXIM INVESCO
BALANCED PORTFOLIO N/A N/A N/A 19.70%
Comparison Information (3) 22.96% 15.22% 15.29%
</TABLE>
(2) The Lehman Brothers Intermediate Government/Corporate Bond
Index is an index of all investment grade publicly traded
issues of at least $50 million outstanding with a four year
average maturity.
(3 The S&P 500 Index is an index comprised of 500 stocks
chosen for their general representation of the stock market
composition by Standard & Poor's Corporation.
(4) The Lipper Analytical Services Inc. Balanced Fund Survey
is a survey of approximately 61 balanced funds.
(5) The Russell 2000 Index is an index which tracks a broadly
diversified group of small capitalization domestic stocks.
(6) The Morgan Stanley Capital International EAFE Index is an
index which tracks stocks from Europe, Australia and the Far
East.
(7) The Lehman Brothers Mortgage-Backed Securities Index is an
index of 15 and 30-year fixed rate securities backed by
mortgage pools of GNMAS, FNMA and FHLMC. Balloons are also
included in the Index.
<PAGE> 97
<PAGE>
(8) The Merrill Lynch Government/Corporate Index is a broad-
based bond index of investment grade publicly traded issues.
(9) The S&P MidCap 400 Index is market-weighted and consists
of stocks, each having a median market capitalization of $1.6
billion.
+From September 24, 1984, until December 1, 1992, the Stock
Index Portfolio was named the Growth Portfolio and prior to
September 24, 1984, was named the Income/Equity Portfolio.
During these periods, the Portfolio's investment policies
differed from the Stock Index Portfolio's current policies.
++From July 29, 1987, until May 1, 1990, the U.S. Government
Securities Portfolio's name was the Government and High
Quality Securities Portfolio and from April 8, 1985, until
July 29, 1987, the Portfolio's name was the Government
Guaranteed Portfolio. During these periods the Portfolio's
investment policies differed from the U.S. Government
Securities Portfolio's current policies.
+++The Total Return Portfolio was established effective July
29, 1987. The Small-Cap Index, Small-Cap Value and
International Equity Portfolios were established effective
December 1, 1993. The MidCap Portfolio was established
effective January 3, 1994. The Maxim INVESCO Small-Cap Growth,
Corporate Bond, Maxim INVESCO ADR and Maxim T. Rowe Price
Equity/Income Portfolios were established November 1, 1994.
The Maxim INVESCO Balanced Portfolio was established effective
October 1, 1996.
GENERAL INFORMATION
Reports to Shareholders
The fiscal year of the Fund ends on December 31 of each
year. The Fund will send to its shareholders, at least
semiannually, reports showing performance of the Fund's
portfolios and other information. An annual report, containing
financial statements, audited by independent certified public
accountants, will be sent to shareholders each year.
Custodian
Bank of New York, New York City ("BONY"), acts as
custodian of the Fund's assets. BONY has custody of the Fund's
assets held within and outside the United States. BONY holds
the Fund's assets in safekeeping and collects and remits the
income thereon subject to the instructions of the Fund.
Independent Auditors
<PAGE> 98
<PAGE>
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.
Legal Counsel
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> 99
<PAGE>
[Qualified Prospectus]
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
investment portfolios: the Money Market Portfolio, the
Investment Grade Corporate Bond Portfolio, the Stock Index
Portfolio, the U.S. Government Mortgage Securities Portfolio,
the Total Return Portfolio, the Small-Cap Index Portfolio, the
Value Index Portfolio, the Growth Index Portfolio, the
Small-Cap Value Portfolio, the Small-Cap Aggressive Growth
Portfolio, the Corporate Bond Portfolio, the Foreign Equity
Portfolio, the Short-Term Maturity Bond Portfolio, the Maxim
Blue Chip Portfolio and the Maxim MidCap Growth Portfolio.
The investment objective of the Money Market Portfolio is
preservation of capital, liquidity and the highest possible
current income consistent with the foregoing objectives,
through investments in short-term money market securities.
Shares of the Money Market Portfolio are neither insured nor
guaranteed by the U.S. Government. Further, there is no
assurance that the Portfolio will be able to maintain a stable
net asset value of $1.00 per share.
The Investment Grade Corporate Bond Portfolio seeks the
highest possible current income within the confines of the
primary goal of insuring the protection of capital by
investing primarily in investment grade corporate debt
securities and in debt securities issued by the U.S.
Government and its agencies.
The principal objective of the Stock Index Portfolio is
to provide investment results, before fees, that correspond to
the total return of the S&P 500 Index and the S&P MidCap
Index, weighted according to their pro rata share of the
market.
The investment objective of the U.S. Government Mortgage
Securities Portfolio is to seek the highest level of return
consistent with preservation of capital and substantial credit
protection. The Portfolio seeks to achieve this objective by
investing primarily in mortgage related securities issued or
guaranteed by the U.S. Government or one of its agencies or
instrumentalities.
The objective of the Total Return Portfolio is to seek to
obtain the highest possible total return, a combination of
<PAGE> 100
<PAGE>
income and capital appreciation, consistent with reasonable
risk.
This Prospectus sets forth concisely the information
about the Fund 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.
G W CAPITAL MANAGEMENT, INC.
Investment Adviser
The date of this Prospectus is May 1, 1997.
<PAGE> 101
<PAGE>
The objective of the Small-Cap Index Portfolio is to
provide investment results, before fees, that correspond to
the total return of the Russell 2000 Index.
The objective of the Value Index Portfolio is to provide
investment results, before fees, that correspond to the total
return of the Russell 1000 Value Index.
The objective of the Growth Index Portfolio is to provide
investment results, before fees, that correspond to the total
return of the Russell 1000 Growth Index.
The objective of the Small-Cap Value Portfolio is to
achieve long-term capital appreciation by investing primarily
in common stocks, although the Portfolio may also invest in
other securities, including restricted and preferred stocks.
The investment objective of the Small-Cap Aggressive
Growth Portfolio is long-term capital growth. The Small-Cap
Aggressive Growth Portfolio seeks to achieve its objective by
investing in common stocks or their equivalent emphasizing
securities believed to be undervalued by the market.
The investment objective of the Corporate Bond Portfolio
is high total investment return. The Corporate Bond Portfolio
seeks to achieve its investment objective by investing
primarily in debt securities (including convertibles),
although up to 20% of its total assets (measured at the time
of acquisition) may be invested in preferred stocks.
The investment objective of the Foreign Equity Portfolio
is total return from long-term growth of capital and dividend
income. The Foreign Equity Portfolio seeks to achieve its
objective by investing primarily in international equity
securities. Although the Portfolio seeks to invest primarily
in common stocks, it may also invest in any type of equity
security.
The investment objective of the Short-Term Maturity Bond
Portfolio is preservation of capital, liquidity, and maximum
total return through investment in an actively managed
portfolio of debt securities.
The investment objective of the Maxim Blue Chip Portfolio
is long-term growth of capital and income. To achieve its
objective, the Portfolio normally will invest primarily in
common stocks of large, well-established, stable and mature
companies, commonly known as "Blue Chip" companies.
The investment objective of the Maxim MidCap Growth
Portfolio is to provide long-term appreciation by investing
<PAGE> 102
<PAGE>
primarily in common stocks of medium-sized (mid-cap) growth
companies. To achieve this objective, the Portfolio will
invest at least 65% of its assets in a diversified portfolio
of mid-cap companies whose earnings are expected to grow at a
faster rate than the average company.
<PAGE> 103
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0007 $1.0007
Income from Investment Operations
Net Investment Income 0.0493 0.0555
Net Gains or Losses of Securities
(realized and unrealized)
Total from Investment Operations 0.0493 0.0555
Less Distributions
Dividends (from net investment income) (0.0493) (0.0555)
Distribution (from capital gains)
Initial Capitalization
Returns of Capital Total
Distributions (0.0493) (0.5550)
Net Asset Value End of Period $1.0007 $1.0007
Net Assets, End of Period 396,453,188 277,257,289
Ratio of Expenses to Average Net Assets 0.46% 0.46%
Ratio of Net Income to Average Net Assets 4.99% 5.55%
Portfolio Turnover Rate
</TABLE>
<PAGE> 104
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0007 $1.0007
Income from Investment Operations
Net Investment Income 0.0394 0.0278
Net Gains or Losses of Securities
(realized and unrealized)
Total from Investment Operations 0.0394 0.0278
Less Distributions
Dividends (from net investment income) (0.0394) (0.0278)
Distribution (from capital gains)
Initial Capitalization
Returns of Capital Total
Distributions (0.0394) (0.0278)
Net Asset Value End of Period $1.0007 $1.0007
Net Assets, End of Period 186,587,262 96,997,973
Ratio of Expenses to Average Net Assets 0.46% 0.46%
Ratio of Net Income to Average Net Assets 3.96% 2.82%
Portfolio Turnover Rate
</TABLE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
<PAGE> 105
<PAGE>
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
Years Ended December 31,
1992 1991
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0006 $1.0005
Income from Investment Operations
Net Investment Income 0.0343 0.0565
Net Gains or Losses of Securities 0.0001 0.0001
(realized and unrealized)
Total from Investment Operations 0.0344 0.0566
Less Distributions
Dividends (from net investment income) (0.0343) (0.0565)
Distribution (from capital gains)
Initial Capitalization
Returns of Capital Total
Distributions (0.0343) (0.0565)
Net Asset Value End of Period $1.0007 $1.0006
Net Assets, End of Period 64,220,562 52,118,377
Ratio of Expenses to Average Net Assets 0.46% 0.48%
Ratio of Net Income to Average Net Assets 3.43% 6.15%
Portfolio Turnover Rate
</TABLE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<PAGE> 106
<PAGE>
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
Years Ended December 31,
1990 1989
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0027 $1.0014
Income from Investment Operations
Net Investment Income 0.0766 0.0870
Net Gains or Losses of Securities (0.0022) 0.0013
(realized and unrealized)
Total from Investment Operations 0.0744 0.0833
Less Distributions
Dividends (from net investment income) (0.0766) (0.0870)
Distribution (from capital gains)
Initial Capitalization
Returns of Capital Total
Distribution (0.0766) (0.0870)
Net Asset Value End of Period $1.0005 $1.0027
Net Assets, End of Period 36,738,618 28,749,125
Ratio of Expenses to Average Net Assets 0.50% 0.50%
Ratio of Net Income to Average Net Assets 8.14% 9.18%
Portfolio Turnover Rate
</TABLE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
Years Ended December 31,
1988 1987
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0002 $0.9988
Income from Investment Operations
Net Investment Income 0.0711 0.0635
<PAGE> 107
<PAGE>
Net Gains or Losses of Securities 0.0018 0.0014
(realized and unrealized)
Total from Investment Operations 0.0729 0.0649
Less Distributions
Dividends (from net investment income) (0.0711) (0.0635)
Distribution (from capital gains) (0.0006)
Initial Capitalization
Returns of Capital Total
Distribution (0.0717) (0.0635)
Net Asset Value End of Period $1.0014 $1.0002
Net Assets, End of Period 24,590,994 18,947,848
Ratio of Expenses to Average Net Assets 0.50% 0.50%
Ratio of Net Income to Average Net Assets 7.61% 6.85%
Portfolio Turnover Rate
</TABLE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
STOCK INDEX PORTFOLIO*
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.9796 $1.4978
Income from Investment Operations
Net Investment Income 0.0336 0.0334
Net Short-Term realized gain 0.0009 0.0010
Net Gains or Losses on Securities
(realized and unrealized) 0.3951 0.4953
Total from Investment Operations 0.4296 0.5297
Less Distributions
Dividends (from net investment income
<PAGE> 108
<PAGE>
and net Short-Term realized gains) (0.0345) (0.0344)
Distributions (from capital gains) (0.0097) (0.0135)
Initial Capitalization
Returns of Capital Total Distributions (0.0442) (0.0479)
Net Asset Value End of Period $2.3650 $1.9796
Total Return (1) 21.81% 35.60%
Net Assets, End of Period 936,806,358 707,459,637
Average Commission Rate Paid
Per Share Bought or Sold $0.0389
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 1.58% 1.91%
Portfolio Turnover Rate 3.31% 5.25%
</TABLE>
*From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio.
During these periods, the Portfolio's investment policies
differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 109
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
STOCK INDEX PORTFOLIO*
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.5575 $1.4506
Income from Investment Operations
Net Investment Income 0.0350 0.0320
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0335) (0.1097)
Total from Investment Operations 0.0015 0.1417
Less Distributions
Dividends (from net investment income
and net Short-Term realized gains) (0.0350) (0.0320)
Distributions (from capital gains) (0.0262) (0.0028)
Initial Capitalization
Returns of Capital Total Distributions (0.0612) (0.0348)
Net Asset Value End of Period $1.4978 $1.5575
Total Return (1) 0.14% 9.84%
Net Assets, End of Period 497,339,992 562,189,394
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 2.23% 2.14%
Portfolio Turnover Rate 11.98% 1.68%
</TABLE>
*From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
<PAGE> 110
<PAGE>
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio.
During these periods, the Portfolio's investment policies
differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 111
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
STOCK INDEX PORTFOLIO*
Years Ended December 31,
1992 1991
<S> <C> <C>
Net Asset Value, Beginning of Period $1.5206 $1.3191
Income from Investment Operations
Net Investment Income 0.0383 0.0563
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.0502 0.2492
Total from Investment Operations 0.0885 0.3055
Less Distributions
Dividends (from net investment income
and net Short-Term realized gains) (0.0382) (0.0542)
Distributions (from capital gains) (0.1203) (0.0498)
Initial Capitalization
Returns of Capital Total Distributions (0.1585) (0.1040)
Net Asset Value End of Period $1.4506 $1.5206
Total Return (1) 5.87% 23.33%
Net Assets, End of Period 462,539,021 359,177,318
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 2.49% 4.33%
Portfolio Turnover Rate 118.83% 24.28%
</TABLE>
*From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
<PAGE> 112
<PAGE>
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio.
During these periods, the Portfolio's investment policies
differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 113
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
STOCK INDEX PORTFOLIO*
Years Ended December 31,
1990 1989
<S> <C> <C>
Net Asset Value, Beginning of Period $1.3947 $1.2986
Income from Investment Operations
Net Investment Income 0.0682 0.0769
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0756) 0.1213
Total from Investment Operations (0.0074) 0.1982
Less Distributions
Dividends (from net investment income
and net Short-Term realized gains) (0.0682) (0.0769)
Distributions (from capital gains) (0.0252)
Initial Capitalization
Returns of Capital Total Distributions (0.0682) (0.1021)
Net Asset Value End of Period $1.3191 $1.3947
Total Return (1) -0.58% 15.21%
Net Assets, End of Period 223,661,178 182,730,744
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 5.70% 6.15%
Portfolio Turnover Rate 26.41% 37.96%
</TABLE>
*From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
<PAGE> 114
<PAGE>
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio.
During these periods, the Portfolio's investment policies
differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 115
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
STOCK INDEX PORTFOLIO*
Years Ended December 31,
1988 1987
<S> <C> <C>
Net Asset Value, Beginning of Period $1.1788 $1.2743
Income from Investment Operations
Net Investment Income 0.0605 0.0563
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.1518 0.0412
Total from Investment Operations 0.2123 0.0975
Less Distributions
Dividends (from net investment income
and net Short-Term realized gains) (0.0608) (0.0559)
Distributions (from capital gains) (0.0317) (0.1371)
Initial Capitalization
Returns of Capital Total Distributions (0.0925) (0.1930)
Net Asset Value End of Period $1.2986 $1.1788
Total Return (1) 17.91% 5.85%
Net Assets, End of Period 134,553,151 97,806,067
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 5.29% 4.61%
Portfolio Turnover Rate 44.65% 47.66%
</TABLE>
*From September 24, 1984 until December 1, 1992, the
Portfolio's name was the Growth Portfolio, and prior to
<PAGE> 116
<PAGE>
September 24, 1984 the Portfolio's name was the Income/Equity
Portfolio.
During these periods, the Portfolio's investment policies
differed from its current policies.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 117
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
TOTAL RETURN PORTFOLIO
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.2969 $1.1238
Income from Investment Operations
Net Investment Income 0.0366 0.0421
Net Short-Term realized gain 0.0139
Net Gains or Losses on Securities
(realized and unrealized) 0.1146 0.1960
Total from Investment Operations 0.1512 0.2520
Less Distributions
Dividends (from net investment income
and net Short-Term realized gain) (0.0366) (0.0560)
Distributions (from capital gains) (0.0703) (0.0229)
Initial Capitalization
Returns of Capital Total Distributions (0.1069) (0.0789)
Net Asset Value End of Period $13,412.0000 $1.2969
Total Return (1) 11.75% 22.70%
Net Assets, End of Period 64,660,804 55,176,028
Average Commission Rate Paid
Per Share Bought or Sold $0.0691
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 2.78% 3.41%
Portfolio Turnover Rate 74.52% 44.70%
</TABLE>
The Total Return Portfolio was established effective July 29,
1987.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 118
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
TOTAL RETURN PORTFOLIO
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.2065 $1.1327
Income from Investment Operations
Net Investment Income 0.0382 0.0326
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0704) 0.1025
Total from Investment Operations (0.0322) 0.1351
Less Distributions
Dividends (from net investment income
and net Short-Term realized gain) (0.0382) (0.0326)
Distributions (from capital gains) (0.0123) (0.0287)
Initial Capitalization
Returns of Capital Total Distributions (0.0505) (0.0613)
Net Asset Value End of Period $1.1238 $1.2065
Total Return (1) -2.68% 12.19%
Net Assets, End of Period 41,348,517 39,297,459
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 3.30% 2.88%
Portfolio Turnover Rate 74.85% 58.02%
</TABLE>
The Total Return Portfolio was established effective July 29,
1987.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 119
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
TOTAL RETURN PORTFOLIO
Years Ended December 31,
1992 1991
<S> <C> <C>
Net Asset Value, Beginning of Period $1.1156 $1.0017
Income from Investment Operations
Net Investment Income 0.0424 0.0979
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.0165 0.1177
Total from Investment Operations 0.0589 0.2156
Less Distributions
Dividends (from net investment income
and net Short-Term realized gain) (0.0375) (0.0543)
Distributions (from capital gains) (0.0043) (0.0474)
Initial Capitalization
Returns of Capital Total Distributions (0.0418) (0.1017)
Net Asset Value End of Period $1.1327 $1.1156
Total Return (1) 5.45% 22.04%
Net Assets, End of Period 18,696,606 11,783,118
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 3.56% 2.52%
Portfolio Turnover Rate 29.26% 92.80%
</TABLE>
The Total Return Portfolio was established effective July 29,
1987.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 120
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
TOTAL RETURN PORTFOLIO
Years Ended December 31,
1990 1989
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0279 $0.9018
Income from Investment Operations
Net Investment Income 0.0541 0.0542
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0262) 0.1261
Total from Investment Operations 0.0279 0.1803
Less Distributions
Dividends (from net investment income
and net Short-Term realized gain) (0.0541) (0.0542)
Distributions (from capital gains)
Initial Capitalization
Returns of Capital Total Distributions (0.0541) (0.0542)
Net Asset Value End of Period $1.0017 $1.0279
Total Return (1) 2.92% 20.48%
Net Assets, End of Period 11,875,970 13,205,175
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 5.98% 6.17%
Portfolio Turnover Rate 59.96% 59.25%
</TABLE>
The Total Return Portfolio was established effective July 29,
1987.
<PAGE> 121
<PAGE>
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 122
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993, 1992,
1991, 1990, 1989, 1988, and 1987
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
TOTAL RETURN PORTFOLIO
Years Ended December 31,
1988 1987
<S> <C> <C>
Net Asset Value, Beginning of Period $0.8750
Income from Investment Operations
Net Investment Income 0.0536 0.0180
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.0271 (0.3738)
Total from Investment Operations 0.0807 (0.3558)
Less Distributions
Dividends (from net investment income
and net Short-Term realized gain) (0.0539) (0.0178)
Distributions (from capital gains)
Initial Capitalization 1.2486
Returns of Capital Total Distributions (0.0539) 1.2308
Net Asset Value End of Period $0.9018 $0.8750
Total Return (1) 9.34%
Net Assets, End of Period 10,992,865 9,644,569
Average Commission Rate Paid
Per Share Bought or Sold
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 6.56% 5.35%
Portfolio Turnover Rate 92.15% 67.24%
</TABLE>
The Total Return Portfolio was established effective July 29,
1987.
<PAGE> 123
<PAGE>
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 124
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993 and
1992**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
INVESTMENT GRADE CORPORATE BOND PORTFOLIO
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.3161 $1.2019
Income from Investment Operations
Net Investment Income 0.0078 0.0794
Net Short-Term realized gain 0.0022
Net Gains or Losses on Securities
(realized and unrealized) (0.0387) 0.1142
Total from Investment Operations 0.0390 0.1958
Less Distributions
Dividends (from net investment income) (0.0777) (0.0816)
Distributions (from capital gains)
Initial Capitalization
Returns of Capital Total Distributions (0.0777) (0.0816)
Net Asset Value End of Period $1.2775 $1.3161
Total Return (1) 3.14% 16.71%
Net Assets, End of Period 100,722,152 95,210,404
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 6.08% 6.30%
Portfolio Turnover Rate 118.50% 159.21%
</TABLE>
* Annualized.
** The Investment Grade Corporate Bond Portfolio was
established effective December 1, 1992
<PAGE> 125
<PAGE>
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 126
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993 and
1992**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
INVESTMENT GRADE CORPORATE BOND PORTFOLIO
Years Ended December 31,
1994 1993 1992
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $1.3090 $1.2957 $1.0000
Income from Investment Operations
Net Investment Income 0.0665 0.0691 0.0058
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.1071) 0.0452 0.2957
Total from Investment Operations (0.0406) 0.1143 0.3015
Less Distributions
Dividends (from net investment income) (0.0665) (0.0686) (0.0058)
Distributions (from capital gains) (0.0324)
Initial Capitalization
Returns of Capital Total Distributions (0.0665) (0.1010) (0.0058)
Net Asset Value End of Period $1.2019 $1.3090 $1.2957
Total Return (1) -3.15% 8.95% 29.57%
Net Assets, End of Period 71,276,294 63,585,296 49,607,522
Ratio of Expenses to Average Net Assets 0.60% 0.60%* 0.59%*
Ratio of Net Income to Average Net Assets 5.37% 5.13%* 4.71%
Portfolio Turnover Rate 51.66% 151.14% 23.91%
</TABLE>
* Annualized.
<PAGE> 127
<PAGE>
** The Investment Grade Corporate Bond Portfolio was
estabished effective December 1, 1992
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 128
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993 and
1992**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
US GOVERNMENT MORTGAGE SECURITIES PORTFOLIO
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.1786 $1.0917
Income from Investment Operations
Net Investment Income 0.0751 0.0781
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0267) 0.0869
Total from Investment Operations 0.0484 0.1650
Less Distributions
Dividends (from net investment income) (0.0751) (0.0781)
Distributions (from capital gains)
Initial Capitalization
Returns of Capital Total Distributions (0.0751) (0.0781)
Net Asset Value End of Period $1.1519 $1.1786
Total Return (1) 4.29% 15.55%
Net Assets, End of Period 138,465,908 129,549,680
Ratio of Expenses to Average Net Assets 0.60% 0.60%
Ratio of Net Income to Average Net Assets 6.51% 6.84%
Portfolio Turnover Rate 94.63% 188.04%
</TABLE>
* Annualized.
<PAGE> 129
<PAGE>
** The U.S. Government Mortgage Securities Portfolio was
established effective December 1, 1992.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
(2) In 1994, the Portfolio turnover rate was higher than in
past years due to the impact of rising interest rates with
respect to the reverse dollar repurchase ("dollar roll")
strategy utilized for this Portfolio. High Portfolio turnover
rates may occur in the future if the similar economic
conditions occur.
<PAGE> 130
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994, 1993 and
1992**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
US GOVERNMENT MORTGAGE SECURITIES PORTFOLIO
Years Ended December 31,
1994 1993 1992
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $1.1813 $1.1503 $1.0000
Income from Investment Operations
Net Investment Income 0.0620 0.0788 0.0029
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0869) 0.0315 0.1598
Total from Investment Operations (0.0276) 0.1103 0.1627
Less Distributions
Dividends (from net investment income) (0.0620) (0.0788) (0.0029)
Distributions (from capital gains) (0.0005) (0.0095)
Initial Capitalization
Returns of Capital Total Distributions (0.0620) (0.0793) (0.0124)
Net Asset Value End of Period $1.0917 $1.1813 $1.1503
Total Return (1) -2.34% 9.65% 15.03%
Net Assets, End of Period 93,386,366 77,052,883 28,107,848
Ratio of Expenses to Average Net Assets 0.60% 0.60% 0.59%*
Ratio of Net Income to Average Net Assets 5.67% 8.12% 3.16%*
Portfolio Turnover Rate (2) 331.42% 17.78% 33.52%
</TABLE>
* Annualized.
<PAGE> 131
<PAGE>
** The U.S. Government Mortgage Securities Portfolio was
established effective December 1, 1992.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
(2) In 1994, the Portfolio turnover rate was higher than in
past years due to the impact of rising interest rates with
respect to the reverse dollar repurchase ("dollar roll")
strategy utilized for this Portfolio. High Portfolio turnover
rates may occur in the future if the similar economic
conditions occur.
<PAGE> 132
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Value Portfolio
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0669 $0.9974
Income from Investment Operations
Net investment income 0.0095 0.286
Net Short-Term realized gain 0.0350
Net Gains or Losses on Securities 0.1811 0.0884
(realized and unrealized) 0.1906 0.1520
Total from Investment Operations
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0095) (0.0636)
Distributions (from capital gains) (0.0189)
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0095) (0.0825)
Net Asset Value End of Period $1.2480 $1.0669
Total Return (1) 17.94% 15.51%
Net Assets, End of Period 36,599,651 20,769,579
Average Commission Rate Paid Per
Share Bought or Sold $0.0521
Ratio of Expenses to Average Net
Assets 1.31%# 1.35%#
Ratio of Net Income to Average Net
Assets 0.90% 2.51%
Portfolio Turnover Rate 30.61% 17.78%
</TABLE>
* Annualized
<PAGE> 133
<PAGE>
** The Small-Cap Value Portfolio was established effective
December 1, 1993.
# Percentages are shown net of expenses reimbursed by The
Great-West Life Assurance Company or GW Capital
Management, Inc.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 134
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Value Portfolio
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0330 $1.0000
Income from Investment Operations
Net investment income 0.0068 0.0012
Net Short-Term realized gain
Net Gains or Losses on Securities (0.0356) 0.0330
(realized and unrealized) (0.0288) 0.0342
Total from Investment Operations
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0068) (0.0012)
Distributions (from capital gains) - -
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0068) (0.0012)
Net Asset Value End of Period $0.9974 $1.0330
Total Return (1) -2.78% 3.42%
Net Assets, End of Period 9,721,848 3,007,882
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 1.33%# 1.33%*#
Ratio of Net Income to Average Net
Assets 0.80% 1.52*
Portfolio Turnover Rate 16.81% -
</TABLE>
<PAGE> 135
<PAGE>
* Annualized
** The Small-Cap Value Portfolio was established effective
December 1, 1993.
# Percentages are shown net of expenses reimbursed by The
Great-West Life Assurance Company or GW Capital
Management, Inc.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 136
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Index Portfolio
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.1680 $0.9540
Income from Investment Operations
Net investment income 0.0124 0.0102
Net Short-Term realized gain 0.0374 0.0095
Net Gains or Losses on Securities
(realized and unrealized) 0.1284 0.2298
Total from Investment Operations 0.1783 0.2495
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0498) (0.0197)
Distributions (from capital gains) (0.5950) (0.0158)
Initial Capitalization - -
Returns of Capital Total
Distributions (0.1093) (0.0355)
Net Asset Value End of Period $1.2370 $1.1680
Total Return (1) 15.30% 26.24%
Net Assets, End of Period 80,783,692 51,610,284
Average Commission Rate Paid Per
Share Bought or Sold $0.0453
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average Net
Assets 1.04% 1.00%
Portfolio Turnover Rate 39.66% 30.17%
<PAGE> 137
<PAGE>
</TABLE>
* Annualized
** The Small-Cap Index was established effective December 1,
1993.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 138
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Index Portfolio
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0112 $1.0000
Income from Investment Operations
Net investment income 0.0097 0.0009
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0572) 0.0112
Total from Investment Operations (0.0475) 0.0121
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0097) (0.0009)
Distributions (from capital gains) - -
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0097) (0.0009)
Net Asset Value End of Period $0.9540 $1.0112
Total Return (1) -4.69% 1.21%
Net Assets, End of Period 22,336,944 5,936,716
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.60%*
Ratio of Net Income to Average Net
Assets 1.20% 1.24%*
Portfolio Turnover Rate 53.44% 0.72%
</TABLE>
* Annualized
<PAGE> 139
<PAGE>
** The Small-Cap Index was established effective December 1,
1993.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 140
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Value Index Portfolio
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.2623 $0.9614
Income from Investment Operations
Net investment income 0.0298 0.0305
Net Short-Term realized gain 0.1010 0.0054
Net Gains or Losses on Securities
(realized and unrealized) 0.2186 0.03144
Total from Investment Operations 0.2585 0.3503
Less Distributions
Dividends (from net investment
income and net Short-Term realized
gains) (0.0399) (0.0359)
Distributions (from capital gains) (0.0271) (0.0135)
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0670) (0.0494)
Net Asset Value End of Period $1.4538 $1.2623
<PAGE> 141
<PAGE>
Total Return (1) 20.63% 36.80%
Net Assets, End of Period 122,283,026 65,183,898
Average Commission Rate Paid Per
Share Bought or Sold $0.0377
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average Net
Assets 2.38% 2.87%
Portfolio Turnover Rate 16.31% 18.11%
</TABLE>
* Annualized
** The Value Index Portfolio was established effective
December 1, 1993.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 142
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Value Index Portfolio
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0118 $1.0000
Income from Investment Operations
Net investment income 0.0253 0.0014
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0504) 0.0119
Total from Investment Operations (0.0251) 0.0133
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0253) (0.0014)
Distributions (from capital gains) - (0.0001)
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0253) (0.0015)
Net Asset Value End of Period $0.9614 $1.0118
-2.49% 1.32%
Total Return (1)
25,610,474 4,337,142
Net Assets, End of Period
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net 0.60% 0.59%*
Assets
Ratio of Net Income to Average Net 3.18% 2.11%*
Assets 16.88% 8.99%
Portfolio Turnover Rate
</TABLE>
<PAGE> 143
<PAGE>
* Annualized
** The Value Index Portfolio was established effective
December 1, 1993.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 144
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Growth Index Portfolio
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.3459 $1.0120
Income from Investment Operations
Net investment income 0.0114 0.0127
Net Short-Term realized gain 0.0084 0.0038
Net Gains or Losses on Securities
(realized and unrealized) 0.2767 0.3394
Total from Investment Operations 0.2965 0.3359
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0198) (0.0165)
Distributions (from capital gains) (0.1374) (0.0055)
Initial Capitalization - -
Returns of Capital Total
Distributions (0.1572) (0.0220)
Net Asset Value End of Period $1.4852 $1.3459
Total Return (1) 22.10% 35.29%
Net Assets, End of Period 83,743,210 43,515,299
Average Commission Rate Paid Per
Share Bought or Sold $0.0358
Ratio of Expenses to Average Net
Assets 0.60% 0.60%
Ratio of Net Income to Average Net
Assets 0.83% 1.15%
Portfolio Turnover Rate 41.55% 17.90%
<PAGE> 145
<PAGE>
</TABLE>
* Annualized
** The Growth Cap Index Portfolio was established effective
December 1, 1993.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 146
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Growth Index Portfolio
Years Ended December 31,
1994 1993
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0064 $1.0000
Income from Investment Operations
Net investment income 0.0133 0.0015
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0056) 0.0064
Total from Investment Operations (0.0189) 0.0079
Less Distributions
Dividends (from net investment
income and Net Short-Term realized
gains) (0.0133) (0.0015)
Distributions (from capital gains) - -
Initial Capitalization - -
Returns of Capital Total
Distributions (0.0133) (0.0015)
Net Asset Value End of Period $1.0120 $1.0064
Total Return (1) 1.93% 0.79%
Net Assets, End of Period 14,171,307 3,099,916
Average Commission Rate Paid Per
Share Bought or Sold
Ratio of Expenses to Average Net
Assets 0.60% 0.59%*
Ratio of Net Income to Average Net
Assets 1.57% 1.98%*
Portfolio Turnover Rate 18.50% 0.06%
</TABLE>
* Annualized
<PAGE> 147
<PAGE>
** The Growth Cap Index Portfolio was established effective
December 1, 1993.
(1) The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 148
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, and 1994**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Corporate Bond Portfolio
Years Ended December 31,
<S> <C> <C>
1996 1995
Net Asset Value, Beginning of Period $1.1521 $0.9716
Income from Investment Operations
Net investment income 0.0825 0.0842
Net Short-Term realized gain 0.0055 0.0159
Net Gains or Losses on Securities
(realized and unrealized) 0.0269 0.1835
Total from Investment Operations 0.1149 0.2836
Less Distributions
Dividends (from net investment
income and Net Short-Term
realized gains) (0.8800) (0.1001)
Distributions (from capital gains) (0.0172) (0.0030)
Initial Capitalization - -
Returns of Capital Total
Distributions (0.1052) (0.1031)
Net Asset Value End of Period $1.1618 $1.1521
Total Return (1) 10.35% 30.19%
Net Assets, End of Period 83,645,029 45,530,190
Ratio of Expenses to
Average Net Assets 0.90% 0.90%
Ratio of Net Income to Average
Net Assets 7.68% 7.89%
Portfolio Turnover Rate 40.02% 24.70%
</TABLE>
*Annualized
**The Corporate Bond Portfolio was established effective
November 1, 1994.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 149
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1994**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Corporate Bond Portfolio
Years Ended December 31,
<S> <C>
1994
Net Asset Value, Beginning of Period $1.0000
Income from Investment Operations
Net investment income 0.0137
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0284)
Total from Investment Operations (0.0147)
Less Distributions
Dividends (from net investment
income and Net Short-Term
realized gains) (0.0137)
Distributions (from capital gains) -
Initial Capitalization -
Returns of Capital Total
Distributions (0.0137)
Net Asset Value End of Period $0.9716
Total Return (1) -1.47%
Net Assets, End of Period 13,713,195
Ratio of Expenses to
Average Net Assets 1.08%*
Ratio of Net Income to Average
Net Assets 8.64%*
Portfolio Turnover Rate 9.45%
</TABLE>
*Annualized
**The Corporate Bond Portfolio was established effective
November 1, 1994.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 150
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Foreign Equity Portfolio
Years Ended December 31,
1996 95
<S> <C> <C>
Net Asset Value, Beginning of Period $0.9871 $0.9515
Income from Investment Operations
Net investment income (0.0041) 0.0073
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) 0.0709 0.0398
Total from Investment Operations 0.0750 0.0471
Less Distributions
Dividends (from net investment income and
Net Short-Term realized gains)
Distributions (from capital gains) (0.0041) (0.0115)
Initial Capitalization
Returns of Capital Total - -
Distributions
Net Asset Value End of Period (0.0041) (0.0115)
$1.0580 $0.9871
7.61% 5.02%
Total Return (1)
80,106,459 64,403,868
Net Assets, End of Period
Average Commission Rate Paid Per Share $0.2520
Bought or Sold
Ratio of Expenses to Average Net Assets 1.45%# 1.50%#
Ratio of Net Income to Average Net Assets
Portfolio Turnover Rate 0.41% 0.69%
75.65% 119.98
<PAGE> 151
<PAGE>
</TABLE>
*Annualized
**The Foreign Equity Portfolio was established effective
November 1, 1994.
#Percentage is shown net of expenses reimbursed by The Great-
West Life Assurance Company or GW Capital Management, Inc.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 152
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994 and 1993**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Foreign Equity Portfolio
Years Ended December 31,
1994
<S> <C>
Net Asset Value, Beginning of Period $1.0000
Income from Investment Operations
Net investment income -0.0019
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) -0.0466
Total from Investment Operations (0.0485)
Less Distributions
Dividends (from net investment income and
Net Short-Term realized gains)
Distributions (from capital gains) -
Initial Capitalization
Returns of Capital Total -
Distributions
Net Asset Value End of Period
$0.9515
<PAGE> 153
<PAGE>
-4.85%
Total Return (1)
42,760,613
Net Assets, End of Period
Average Commission Rate Paid Per Share
Bought or Sold
Ratio of Expenses to Average Net Assets 1.50*#
Ratio of Net Income to Average Net Assets
Portfolio Turnover Rate -1.26%
19.85%
</TABLE>
*Annualized
**The Foreign Equity Portfolio was established effective
November 1, 1994.
#Percentage is shown net of expenses reimbursed by The Great-
West Life Assurance Company or GW Capital Management, Inc.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 155
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Aggressive Growth Portfolio
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.1605 $0.9755
Income from Investment Operations
Net investment income 0.0091 0.0075
Net Short-Term realized gain 0.0597 0.0878
Net Gains or Losses on Securities
(realized and unrealized) 0.2779 0.1962
Total from Investment Operations 0.3467 0.2915
Less Distributions
Dividends (from net investment income and
Net Short-Term realized gains)
Distributions (from capital gains) (0.0688) (0.0945)
Initial Capitalization (0.0356) (0.0120)
Returns of Capital Total - -
Distributions
Net Asset Value End of Period (0.1044) (0.1065)
$1.4028 $1.1605
<PAGE> 155
<PAGE>
Total Return (1) 30.09% 29.96%
Net Assets, End of Period 79,944,926 28,594,611
Average Commission Rate Paid Per Share
Bought or Sold $0.0573
Ratio of Expenses to Average Net Assets
Ratio of Net Income to Average Net Assets 2.26%# 1.30%#
Portfolio Turnover Rate
0.98% 0.65%
62.63% 99.48%
</TABLE>
*Annualized
**The Small-Cap Aggressive Portfolio was established effective
November 1, 1994.
Percentage is shown net of expenses reimburse by the Great-
West Life Assurance Company or GW Capital Management, Inc.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 156
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, 1995, 1994**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Small-Cap Aggressive Growth Portfolio
Years Ended December 31,
1994
<S> <C>
Net Asset Value, Beginning of Period $1.0000
Income from Investment Operations
Net investment income (0.0016)
Net Short-Term realized gain
Net Gains or Losses on Securities
(realized and unrealized) (0.0229)
Total from Investment Operations (0.0245)
Less Distributions
Dividends (from net investment income and
Net Short-Term realized gains)
Distributions (from capital gains) -
Initial Capitalization -
Returns of Capital Total -
Distributions
Net Asset Value End of Period -
$0.9755
Total Return (1) -2.46%
Net Assets, End of Period 12,963,409
Average Commission Rate Paid Per Share
Bought or Sold
Ratio of Expenses to Average Net Assets
Ratio of Net Income to Average Net Assets 1.26%*#
Portfolio Turnover Rate
-1.08%
8.84%
</TABLE>
<PAGE> 157
<PAGE>
*Annualized
**The Small-Cap Agressive Portfolio was established effective
November 1, 1994.
Percentage is shown net of expenses reimbursed by the Great-
West Life Assurance Company or GW Capital Management, Inc.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 158
<PAGE>
FINANCIAL HIGHLIGHTS (AUDITED)
Per Share Income and Capital Changes
For the Years Ended December 31, 1996, and 1995**
The following tables should be read in conjunction with the
financial statements and related notes included in the
Statement of Additional Information.
<TABLE>
<CAPTION>
Short-Term Maturity Bond Portfolio
Years Ended December 31,
1996 1995
<S> <C> <C>
Net Asset Value, Beginning of Period $1.0092 $1.0000
Income from Investment Operations
Net investment income 0.0489 0.0194
Net Short-Term realized gain 0.0013
Net Gains or Losses on Securities
(realized and unrealized) (0.0027) 0.0092
Total from Investment Operations 0.0462 0.0299
Less Distributions
Dividends (from net investment income and
Net Short-Term realized gain)
Distributions (from capital gains) (0.0489) (0.0207)
Initial Capitalization - -
Returns of Capital Total - -
Distributions
Net Asset Value End of Period (0.0489) (0.0207)
$1.0065 $1.0092
4.70% 3.02%
Total Return (1) 39,503,114 15,618,670
Net Assets, End of Period
Ratio of Expenses to Average Net Assets $0.60% 0.53%*
Ratio of Net Income to Average Net Assets
Portfolio Turnover Rate 5.15% 4.61%*
51.71% 97.87%
</TABLE>
*Annualized
<PAGE> 159
<PAGE>
**The Short-Term Maturity Bond Portfolio was established
effective August 1, 1995.
(1)The performance shown does not reflect fees or expenses
deducted at the separate account level.
<PAGE> 160
<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 and
Pinnacle Series Account of Great-West Life & Annuity Insurance
Company ("GWL&A") and TNE Series(k) Account (collectively, the
"Series Accounts") of Metropolitan Life Insurance Company
("MetLife"). 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
MetLife. 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,
its affiliates, MetLife or other insurance companies. G W
Capital Management, Inc. ("GW Capital Management") is the
Investment Adviser for the Fund. The day-to-day management of
certain Portfolios of the Fund is carried out by sub-advisers
which are not affiliated with GW Capital Management.
THE FUND PORTFOLIOS
Each portfolio has its own investment objective and investment
strategy. The investment objective of any portfolio may not
be changed without a vote of a majority of the shares of that
portfolio. A more detailed description of the Fund's
investment policies and a glossary further describing certain
investment securities mentioned in the discussions that follow
are contained in the Statement of Additional Information.
Following is a description of each of the Portfolios.
Money Market Portfolio
The investment objectives of the Money Market Portfolio are to
preserve shareholder capital, to maintain liquidity and to
achieve the highest possible current income consistent with
the foregoing objectives by investing in short-term money
market securities.
The assets of the Money Market Portfolio are invested in money
market instruments with remaining maturities not exceeding 13
months. The Money Market Portfolio also maintains a
dollar-weighted average portfolio maturity of ninety days or
less. The money market instruments in which the Portfolio may
invest include the following:
1. U.S. government securities and government agency
securities. U.S. government securities consist of various
<PAGE> 161
<PAGE>
types of marketable securities by the United States Treasury,
such as bills, notes and bonds. Such securities are direct
obligations of the United States government. U.S. government
agency securities are debt securities issued by
government-sponsored enterprises, federal agencies and
international institutions. Such securities are not direct
obligations of the U.S. Treasury but involve government
sponsorship or guarantees. Among the agencies whose debt
securities may be purchased are: the Government National
Mortgage Association and Federal Housing Administration, whose
instruments are supported by the full faith and credit of the
United States; the Farm Credit Bank, whose instruments are not
direct obligations of the United States, although the Farm
Credit Bank is supported by its ability to borrow from the
U.S. Treasury; and the Federal Land Bank, Federal Home Loan
Bank and Federal Home Loan Mortgage Corporation, whose
instruments are not supported by the U.S. Treasury, but only
by the credit of the issuing agency;
2. Certificates of deposit, time deposits, swap deposits and
bankers' acceptances of (i) U.S. commercial banks or savings
and loan associations having total assets in excess of $1
billion, or (ii) other U.S. commercial banks or savings and
loan associations, foreign branches of U.S. banks, and U.S.
branches of foreign banks if such bank obligations are fully
insured by the Federal Deposit Insurance Corporation;
3. Commercial paper, including variable amount master demand
notes;
4. Repurchase and reverse repurchase agreements. A
repurchase agreement is an instrument under which the
purchaser (e.g., the Fund) acquires ownership of the
obligation (debt security) and the seller agrees at the time
of the sale to repurchase the obligation at a mutually agreed
upon time and price, thereby determining the yield during the
purchaser's holding period. This results in a fixed rate of
return insulated from market fluctuations during such period.
Reverse repurchase agreements involve the sale of securities
held by the Portfolio, with an agreement to repurchase the
securities at an agreed upon price, date and interest payment.
Repurchase agreements could involve certain risks in the event
of default or insolvency of the other party to the agreement,
including possible delays or restrictions upon the Portfolio's
ability to dispose of the underlying securities. The
Investment Adviser, acting under the supervision of the Board
of Directors, reviews the credit worthiness of those dealers
with whom the Portfolio enters into repurchase agreements; and
5. Other money market instruments that the Portfolio may
from time-to-time invest in include floating rate notes and
<PAGE> 162
<PAGE>
Eurodollar certificates of deposit if denominated in U.S.
currency.
The Money Market Portfolio generally invests in instruments
(other than U.S. government securities) that have received the
highest rating by at least one nationally recognized
statistical rating organization ("NRSRO"), securities whose
issuer has received such ratings with respect to a class of
short-term debt obligations that is comparable in priority and
security with the instrument acquired, or securities which are
determined or ratified by the Fund's Board of Directors as
being comparable to the foregoing securities. The Money Market
Portfolio only enters into repurchase agreements that are
collateralized entirely by U.S. government securities or
securities that, at the time the repurchase agreement is
entered into, are rated in the highest rating categories by at
least one NRSRO.
In addition to following the foregoing guidelines, the Money
Market Portfolio intends otherwise to comply with the
requirements of Rule 2a-7 under the Investment Company Act of
1940, as applicable to the Portfolio.
Investment Grade Corporate Bond Portfolio
The investment objective of the Investment Grade Corporate
Bond Portfolio is to seek the highest possible current income
within the confines of the primary goal of insuring the
protection of capital by investing primarily in investment
grade corporate debt securities and in debt securities issued
by the U.S. government and its agencies. Generally, the
Investment Grade Corporate Bond Portfolio intends to invest in
corporate debt securities having a rating within the two
highest grades as determined by Moody's Investors Service Inc.
(Aaa or Aa) or Standard & Poor's Corporation (AAA or AA). The
Investment Grade Corporate Bond Portfolio may, however, also
invest in debt securities within the third or fourth highest
grades as determined by Moody's Investors Services Inc. (A or
Baa) or Standard & Poor's Corporation (A or BBB), if the Fund
determines such investment meets the standard of the
Portfolio's investment objectives and the debt securities
ratings are supported by an internal credit review that the
Fund will conduct in each such instance. Bonds rated Baa by
Moody's or BBB by Standard & Poor's are considered medium
grade obligations; i.e., they are neither highly protected nor
poorly secured. Interest payments and principal security for
such bonds 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. Adverse changes in
economic conditions are more likely to lead to a weakened
<PAGE> 163
<PAGE>
capacity to make principal and interest payments under such
bonds than in the case of higher grade bonds. The Portfolio
will not retain any bond of this type should its rating drop
below a Baa rating by Moody's or a BBB rating by Standard &
Poor's.
The Investment Grade Corporate Bond Portfolio may invest in
money market securities solely for defensive purposes or as a
cash reserve.
The Investment Grade Corporate Bond Portfolio is classified as
non-diversified. This means that the proportion of the
Portfolio's assets that may be invested in the securities of a
single issuer is not limited by the Investment Company Act of
1940. Because a relatively high percentage of the Portfolio's
assets may be invested in the securities of a limited number
of issuers, primarily within the same industry or economic
sector, the Portfolio's securities may be more susceptible to
any single economic, political or regulatory occurrence than
that experienced by a diversified portfolio.
The portfolio turnover rate for the Portfolio in 1996 was in
excess of 100%. High portfolio turnover rates generally
result in higher transaction costs (which are borne directly
by the Portfolio) and may result in greater tax liability.
U.S. Government Mortgage Securities Portfolio
The investment objective of the U.S. Government Mortgage
Securities Portfolio is to seek the highest level of return
consistent with preservation of capital and substantial credit
protection. The Portfolio seeks to achieve this objective by
investing primarily (at least 65% of its total assets) in
mortgage related securities issued or guaranteed by the U.S.
government or one of its agencies or instrumentalities.
Investment by the U.S. Government Mortgage Securities
Portfolio in U. S. government securities will include direct
pass-through mortgage certificates issued by those government
agencies whose obligations are backed by the full faith and
credit of the United States government, such as the Government
National Mortgage Association ("GNMA") or Federal Housing
Administration. Such pass-through certificates represent
individual interests in pools of mortgages insured by the
Veterans Administration, the Farmers' Home Association,
Federal Housing Administration or other government agencies.
Owners of pass-through certificates are entitled to receive a
pro-rata share of the net payments received on the underlying
mortgages, hence such payments are passed through to the
owner. Accordingly, the amount and frequency of payments on
<PAGE> 164
<PAGE>
such pass-through certificates depends on the rate of
prepayments on the underlying mortgages, which may vary based
upon a variety of economic factors.
The Portfolio may also invest in other U.S. government
securities, such as U.S. Treasury bills, notes and bonds, or
in certificates representing individual interests in pools of
such U.S. Treasury securities. The payment of principal and
interest to the Portfolio on such certificates is fully backed
by the U.S. government.
The Portfolio may additionally invest in securities issued by
the Federal National Mortgage Association ("FNMA") and the
Federal Home Loan Mortgage Corporation ("FHLMC"). FNMA and
FHLMC both issue mortgage-backed securities that are similar
to GNMAs in that they represent interests in pools of mortgage
loans. FNMA guarantees timely payment of interest and
principal on its certificates. FHLMC guarantees timely payment
of interest and ultimate payment of principal. The FNMA and
FHLMC guarantees are backed only by those agencies and not by
the full faith and credit of the United States. The Portfolio
may also invest in private mortgage pass-through securities
and collateralized mortgage obligations ("CMOs"). These CMOs
may take the form of those issued by private issuers and
collateralized by securities issued or guaranteed by the U.S.
government or its agencies or instrumentalities.
The Portfolio may also enter into reverse dollar repurchase
agreements ("dollar rolls") of mortgage-backed securities in
which the Portfolio sells securities for delivery in the
current month and simultaneously contracts to repurchase
substantially similar (same type, coupon and maturity)
securities on a specified future date. During the roll period,
the Portfolio forgoes principal and interest paid on the
mortgage-backed securities. The Portfolio is compensated by
the difference between the current sales price and the lower
forward price for the future purchase as well as the interest
earned on the cash proceeds of the initial sale. Liquid assets
equal to the value of the outstanding repurchase commitments
are segregated from general investible funds and will be
marked to the market daily. The risk associated with dollar
roll transactions is that the securities may not be delivered
and the Portfolio may incur a loss or will have lost the
opportunity to otherwise invest the amount set aside for such
transaction in the segregated asset account. As of December
31, 1996, 12.98% of the Portfolio was comprised of investments
subject to dollar roll transactions.
The Portfolio may purchase securities on a when-issued basis
and may purchase or sell securities on a forward commitment
basis in order to hedge against anticipated changes in
interest rates and prices and/or secure a favorable rate of
<PAGE> 165
<PAGE>
return. The Statement of Additional Information contains more
detailed information about these investment practices.
The market value of securities held by the Portfolio can be
expected to decline when interest rates rise. Thus, the U.S.
Government Mortgage Securities Portfolio will generally
shorten the average maturity of the Portfolio when interest
rates are rising and lengthen the average maturity when
interest rates are falling in order to optimize the total
return of the Portfolio.
The Portfolio may also hold money market instruments as it
believes is advisable to maintain liquidity or for temporary
defensive purposes.
The U.S. Government Mortgage Securities Portfolio is
classified as non-diversified. This means that the proportion
of the Portfolio's assets that may be invested in the
securities of a single issuer is not limited by the Investment
Company Act of 1940. Because a relatively high percentage of
the Portfolio's assets may be invested in the securities of a
limited number of issuers, primarily within the same industry
or economic sector, the Portfolio's securities may be more
susceptible to any single economic, political or regulatory
occurrence than that experienced by a diversified portfolio.
Short-Term Maturity Bond Portfolio
The investment objective of the Short-Term Maturity Bond
Portfolio is preservation of capital, liquidity, and maximum
total return through investment in an actively managed
portfolio of debt securities. It is classified as a non-
diversified portfolio.
The Portfolio will pursue its objectives primarily through
investment in a portfolio of investment grade bonds and other
debt securities of similar quality. The weighted average
quality of the Portfolio will be A rated or higher. The
Portfolio will consist only of individual securities with
maturities of no longer than three years.
Other debt securities in which the Portfolio may invest
include securities of, or guaranteed by, the U.S. Government,
its agencies or instrumentalities, corporate debt obligations,
asset-backed securities (including mortgage-related
securities), commercial paper, certificates of deposits,
bankers' acceptances and other short-term instruments relating
to such securities. Securities may be issued by both domestic
and foreign entities but may be denominated in U.S. dollars
only.
<PAGE> 166
<PAGE>
U.S. Government securities are issued or guaranteed by the
U.S. Treasury or by an agency or instrumentality of the U.S.
Government. Not all U.S. Government securities are backed by
the full faith and credit of the United States. Some are
supported only by the credit of the agency that issued them.
The Portfolio may invest in repurchase agreements relating to
the securities in which it may invest. In a repurchase
agreement, the Portfolio buys a security at one price and
simultaneously agrees to sell it back at a higher price.
Delays or losses could result if the party to the agreement
defaults or becomes bankrupt.
The Portfolio may purchase securities on a when-issued or
forward delivery basis. When-issued and forward delivery
transactions are trading practices wherein payment for and
delivery of the securities take place at a future date. The
market value of a security could change during this period,
which could effect the market value of the Portfolio's assets.
See the Statement of Additional Information for further
information about when-issued and forward delivery securities.
In order to generate additional income, the Portfolio may lend
up to one-third of its portfolio securities to financial
borrowers of securities. This practice could cause the
Portfolio to experience a loss or a delay in recovering its
securities. The Statement of Additional Information contains
more information regarding the lending of securities.
The Portfolio can use various techniques to increase or
decrease its exposure to changing security prices, interest
rates, commodity prices, or other factors that effect
securities values. These techniques include buying and
selling options and certain futures contracts, entering into
swap agreements and purchasing index securities. Further
information regarding such techniques is contained in the
Statement of Additional Information. These techniques will be
used for hedging purposes only.
Generally, the Portfolio intends to invest in investment grade
securities. An investment grade security is one rated in one
of the top four categories by one or more nationally
recognized security rating organizations or which is deemed by
the Investment Adviser to be of comparable creditworthiness.
However, if a security's rating were to drop below investment
grade (commonly referred to as "junk bonds"), the Portfolio
may determine to retain the security until such time as it is
deemed appropriate to sell the security, which could mean that
the security may be held to maturity. Lower rated fixed-
income securities generally provide higher yields, but are
subject to greater credit and market risks than higher quality
fixed-income securities and are considered predominately
<PAGE> 167
<PAGE>
speculative with respect to the ability of the issuer to meet
principal and interest payments. In addition, the secondary
market may be less liquid for lower-rated fixed-income
securities which may make the valuation and sale of the
securities more difficult. The Statement of Additional
Information contains more information about securities
ratings.
The Portfolio may invest in money market securities as part of
the ongoing investment strategy or as a cash reserve.
The Portfolio is classified as non-diversified. This means
that the proportion of the Portfolio's assets that may be
invested in the securities of a single issuer is not limited
by the Investment Company Act of 1940. Because a relatively
high percentage of the Portfolio's assets may be invested in
the securities of a limited number of issuers, primarily
within the same industry or economic sector, the Portfolio's
securities may be more susceptible to any single economic,
political or regulatory occurrence than that experience by a
diversified portfolio.
Total Return Portfolio
The investment objective of the Total Return Portfolio is to
seek to obtain the highest possible total return, a
combination of income and capital appreciation, consistent
with reasonable risk.
In seeking its investment objective, the Total Return
Portfolio invests in three market segments: equity securities,
fixed income securities and money market instruments. The
Portfolio invests in equity securities consisting primarily of
common stock of domestic issuers and any warrants or rights
which may be attached to such common stock. The Portfolio may
also, from time to time, purchase convertible common stock of
such issuers or common stock of foreign issuers. Fixed income
securities in which the Portfolio may invest primarily include
obligations of domestic corporations and governments (federal,
state or municipal obligations) and agencies thereof.
Occasionally, the Portfolio may invest in debt obligations of
foreign governments. (See "Investment Limitations" for certain
limitations applicable to investment in securities of foreign
issuers.)
The Investment Adviser places primary emphasis on the mix of
investments among the three market segments in accordance with
the Adviser's appraisal of investments most likely to achieve
the highest return based upon its judgment as to economic
<PAGE> 168
<PAGE>
prospects and the outlook for interest rates and the equity
markets. The selection of an individual security within a
market segment by the Investment Adviser will be based on the
Adviser's view of the relative attractiveness of the security.
There are no minimum or maximum percentages as to the amount
of the Portfolio's assets which may be invested in each of the
market segments. Major changes in investment mix may occur
several times a year or over several years, depending upon
perceived market and economic conditions.
Except for restrictions noted herein and under "Investment
Restrictions" in the Statement of Additional Information, the
Investment Adviser has complete flexibility in determining the
amount and nature of equity securities, fixed income
securities or money market instruments in which the Portfolio
may invest.
The Portfolio normally invests for long-term gains. It may,
however, invest for short-term gain when, in the view of the
Investment Adviser, evolving economic, business and market
conditions so warrant.
Stock Index Portfolio
The investment objective of the Stock Index Portfolio is to
provide investment results, before fees, that correspond to
the total return of the S&P 500 Index and the S&P MidCap
Index, weighted according to their pro rata share of the
market. The Portfolio will pursue this objective by investing
in common stocks traded on the New York Stock Exchange and the
American Stock Exchange and, to a limited extent, in the
over-the-counter markets.
Standard & Poor's Corporation ("S&P") chooses the 500 stocks
comprising the S&P 500 Index on the basis of market values and
industry diversification. Most of the stocks in the S&P 500
Index are issued by the 500 largest companies, in terms of the
aggregate market value of their outstanding stock, and such
companies are generally listed on the New York Stock Exchange.
Additional stocks that are not among the 500 largest market
value stocks are included in the S&P 500 Index for
diversification purposes.
The S&P MidCap Index is market-weighted and consists of 400
stocks of domestic companies, having a median market
capitalization of approximately $1.6 billion. The stocks
included in the S&P 500 Index and the S&P MidCap Index do not
overlap.
Because smaller capitalized companies, regardless of their
shares outstanding, sometimes exhibit illiquidity in the
market, minimum trading volume constraints are placed on
<PAGE> 169
<PAGE>
issues selected for the S&P MidCap Index. For this reason, the
S&P MidCap Index includes a small number of lesser known
companies in well known industries whose shares are more
liquid.
S&P is not a sponsor of, or in any other way affiliated with,
the Portfolio or the Fund.
The Portfolio will attempt to duplicate the performance of the
S&P 500 Index and the S&P MidCap Index while keeping
transaction costs low and minimizing Portfolio turnover. To
achieve its investment objective, the Portfolio will purchase
equity securities that, in the Adviser's opinion, will
reflect, as a group, the composite price performance of the
S&P 500 Index and the S&P MidCap Index. Like these indices,
the Portfolio will hold both dividend-paying and non-dividend
paying common stocks. Under normal circumstances, at least 80%
of the Portfolio's total assets will be invested in securities
included on the S&P 500 Index and the S&P MidCap Index.
A higher portfolio turnover rate may involve correspondingly
greater brokerage commissions and other expenses which might
be borne by the Fund and, thus, indirectly by its
shareholders.
See also "Index Portfolio Management" in this Prospectus for
more information on management practices and risks associated
with index-type portfolios.
S&P does not endorse, sell, promote or sponsor the Portfolio
or the Fund, and is not in any other way affiliated with the
Portfolio, the Fund or the Investment Adviser.
Small-Cap Index Portfolio
The investment objective of the Small-Cap Index Portfolio is
to provide investment results, before fees, that correspond to
the total return of the Russell 2000 Index. The Russell 2000
Index was developed in 1979 by the Frank Russell Company to
track the stock market performance of a broadly diversified
group of small capitalization domestic stocks. As of December
31, 1996, the median market capitalization of issues
comprising the Russell 2000 Index was approximately $360
million.
The Portfolio intends to pursue this objective by investing
primarily in common stocks issued by corporations domiciled in
the U.S. and its territories traded on the various U.S. stock
exchanges and, to a limited extent, in the over-the-counter
markets. The Portfolio may not hold all of the approximately
2,000 securities in the Russell 2000 Index because of the
administrative costs involved and the expenses associated with
<PAGE> 170
<PAGE>
trading less active securities. Instead, the Portfolio may
hold a representative sample of securities included in the
Russell 2000 Index.
The Frank Russell Company is not a sponsor of, or in any other way
affiliated with, the Portfolio or the Fund.
The Russell 2000 Index is a subset of the larger Russell 3000
Index. The Russell 3000 Index consists of the largest 3000
publicly traded stocks of corporations domiciled in the U.S.
and its territories and includes large, medium and small
capitalization stocks. The Russell 3000 Index represents
approximately 98% of the total market capitalization of all
U.S. stocks that trade on the New York and American Stock
Exchanges and in the NASDAQ (National Association of
Securities Dealers Automated Quotations) National Market
System over-the-counter market. The Russell 2000 Index
consists of the 2000 smallest stocks within the Russell 3000,
representing approximately 6% of the Russell 3000 Index total
market capitalization.
The Russell 2000 Index is reconstituted annually to reflect
changes in the marketplace. The Portfolio will similarly
reconstitute itself on an annual basis. The reconstituted list
of securities are ranked based on May 31 total market
capitalizations, with the actual reconstitution effective June
30. As well, securities that leave the Russell 2000 Index for
any reason between reconstitution dates will not be replaced.
As a result, the number of securities held in the Portfolio
over the year will fluctuate.
The annual turnover rate of the Russell 2000 Index is
significant, often as high as 25% per year of the total market
capitalization of the Index. This investment strategy will be
implemented only to the extent it is consistent with
maintaining the Fund's qualification as a regulated investment
company under the Internal Revenue Code (see "Dividends,
Distributions and Taxes). The Fund's strategy may be limited,
in particular, by the requirement for such qualification that
less than 30% of the Fund's annual gross income be derived
from the sale or other disposition of stocks or securities
(including options and futures contracts) held for less than
three months.
Historically, small capitalization stocks, which constitute
the Portfolio's primary investments, have been more volatile
in price than the larger capitalization stocks included in the
S&P 500 Index. Among the reasons for the greater price
volatility of these small company stocks are the less certain
growth prospects of smaller firms, the lower degree of
liquidity in the markets for such stocks, and the greater
sensitivity of small companies to changing economic
<PAGE> 171
<PAGE>
conditions. Besides exhibiting greater volatility, small
company stocks may, to a degree, fluctuate independently of
larger company stocks. Small company stocks may decline in
price as large company stocks rise, or rise in price as large
company stocks decline. Investors should therefore expect that
the Portfolio may be more volatile than, and may fluctuate
independently of, broad stock market indices such as the S&P
500 Index.
The Portfolio intends that, under normal circumstances, at
least 80% of its total assets will be invested in securities
included in the Russell 2000 Index.
See also "Index Portfolio Management" in this Prospectus for
more information on management practices and risks associated
with index-type portfolios.
Value Index Portfolio
The investment objective of the Maxim Russell 1000 Value Index
Portfolio is to provide investment results, before fees, that
correspond to the total return of the Russell 1000 Value
Index. The Russell 1000 Value Index was developed by the Frank
Russell Company to track stock market performance of stocks
from the Russell 1000 Index exhibiting certain characteristics
suggesting value potential.
The Portfolio intends to pursue this objective by investing
primarily in common stocks with greater than average value
orientation, as determined by the formula set forth below,
issued by corporations domiciled in the U.S. and its
territories traded on the various U.S. stock exchanges and, to
a limited extent, in the over-the-counter markets. The
Portfolio may not hold all of the securities in the Russell
1000 Value Index because of administrative costs involved and
the expenses associated with trading less active securities.
Instead, the Portfolio will hold a representative sample of
securities included in the Russell 1000 Value Index.
The Frank Russell Company is not a sponsor of, or in any other way
affiliated with, the Portfolio or the Fund.
The Russell 1000 Value Index is a subset of the Russell 1000
Index which in turn is a subset of the Russell 3000 Index. The
Russell 3000 Index consists of the largest 3000 publicly
traded stocks of corporations domiciled in the U.S. and its
territories and includes large, medium and small
capitalization stocks.
The Russell 3000 Index represents approximately 98% of the
total market capitalization of all U.S. stocks that trade on
the New York and American Stock Exchanges and in the NASDAQ
<PAGE> 172
<PAGE>
(National Association of Securities Dealers Automated
Quotations) National Market System over-the-counter market.
The Russell 1000 consists of the 1000 largest stocks within
the Russell 3000 Index, representing approximately 94% of the
Russell 3000 Index total market capitalization.
The Russell 1000 Value Index is comprised of stocks from the
Russell 1000 Index with greater-than-average value
orientation. A stock is determined to have
greater-than-average value orientation if it falls in the
bottom 50% of the Russell 1000 Index based on cumulative
market capitalization, ranked by descending price-to-book
ratio. Thus, securities in the Russell 1000 Value Index
typically have low price-to-book and price-earnings ratios,
higher dividend yields and lower forecasted growth rates than
more growth- oriented securities.
The Russell 1000 Value Index is reconstituted annually to
reflect changes in the marketplace. At each reconstitution,
the Russell 1000 Index constituents are ranked by their
price-to-book ratio. Once ranked by this ratio, a breakpoint
is determined by the median market capitalization of the
Russell 1000 Index. As of May 31, 1996, the price-to-book
breakpoint was 3.413.
The Portfolio will similarly reconstitute itself on an annual
basis. The reconstituted list of securities are ranked based
on May 31 total market capitalizations, with the actual
reconstitution effective June 30. As well, securities that
leave the Index for any reason between reconstitution dates
will not be replaced. As a result, the number of securities
held in the Portfolio over the year will fluctuate. As of May
31, 1996, the corporations included in the Russell 1000 Value
Index had an average market capitalization of $2.89 billion.
As discussed above, the Portfolio may not invest in all the
stocks that comprise the Russell 1000 Value Index. Thus, the
Portfolio holdings may be invested differently by industry
segment or by weighting than the Russell 1000 Value Index. The
Portfolio may compensate for the omission from its holdings
that are included in the Russell 1000 Value Index or for
purchasing stocks in proportions that differ from their
weightings in that Index, by purchasing stocks that may or may
not be included in the Russell 1000 Value Index, but which
have characteristics similar to omitted stocks (such as stocks
from the same or similar industry group having similar market
capitalizations and investment characteristics). The Portfolio
will not adopt a temporary or defensive investment posture in
times of generally declining market conditions. Therefore,
investors in the Portfolio will bear the risk of such market
conditions.
<PAGE> 173
<PAGE>
The Portfolio intends that, under normal circumstances, at
least 80% of the Portfolio's total assets will be invested in
securities included in the Russell 1000 Value Index.
See also "Index Portfolio Management" in this Prospectus for
more information on management practices and risks associated
with index-type portfolios.
Growth Index Portfolio
The investment objective of the Growth Index Portfolio is to
provide investment results, before fees, that correspond to
the total return of the Russell 1000 Growth Index. The Russell
1000 Growth Index was developed by the Frank Russell Company
to track stock market performance of stocks from the Russell
1000 Index exhibiting certain characteristics suggesting
growth potential.
The Portfolio intends to pursue this objective by investing
primarily in common stocks with greater than average growth
orientation, as determined by the formula set forth below,
issued by corporations domiciled in the U.S. and its
territories traded on the various U.S. stock exchanges and, to
a limited extent, in the over-the-counter markets. The
Portfolio may not hold all of the securities in the Russell
1000 Growth Index because of administrative costs involved and
the expenses associated with trading less active securities.
Instead, the Portfolio will hold a representative sample of
securities included in the Russell 1000 Growth Index.
The Frank Russell Company is not a sponsor of, or in any other way
affiliated with, the Portfolio or the Fund.
The Russell 1000 Growth Index is a subset of the Russell 1000
Index which in turn is a subset of the Russell 3000 Index. The
Russell 3000 Index consists of the largest 3000 publicly
traded stocks of corporations domiciled in the U.S. and its
territories and includes large, medium and small
capitalization stocks.
The Russell 1000 Growth Index is comprised of stocks from the
Russell 1000 Index with greater-than-average growth
orientation. A stock is determined to have
greater-than-average growth orientation if it falls in the top
50% of the Russell 1000 Index based on cumulative market
capitalization, ranked by descending price-to-book ratio.
Thus, securities in the Russell 1000 Growth Index typically
have high price-to-book and price-earnings ratios, lower
dividend yields and higher forecasted growth rates than more
value-oriented securities.
<PAGE> 174
<PAGE>
The Russell 1000 Growth Index is reconstituted annually to
reflect changes in the marketplace. At each reconstitution,
the Russell 1000 Index constituents are ranked by their price-
to-book ratio. Once ranked by this ratio, a breakpoint is
determined by the median market capitalization of the Russell
1000 Index. As of May 31, 1996, the price-to-book breakpoint
was 3.413.
The Portfolio will similarly reconstitute itself on an annual
basis. The reconstituted list of securities are ranked based
on May 31 total market capitalizations, with the actual
reconstitution effective June 30. As well, securities that
leave the Index for any reason between reconstitution dates
will not be replaced. As a result, the number of securities
held in the Portfolio over the year will fluctuate. As of May
31, 1996, the corporations included in the Russell 1000 Growth
Index had an average market capitalization of $2.67 billion.
As discussed above, the Portfolio may not invest in all the
stocks that comprise the Russell 1000 Growth Index. Thus, the
Portfolio holdings may be invested differently by industry
segment or by weighting than the Russell 1000 Growth Index.
The Portfolio may compensate for the omission from its
holdings that are included in the Russell 1000 Growth Index or
for purchasing stocks in proportions that differ from their
weightings in that Index, by purchasing stocks that may or may
not be included in the Russell 1000 Growth Index, but which
have characteristics similar to omitted stocks (such as stocks
from the same or similar industry group having similar market
capitalizations and investment characteristics). The Portfolio
will not adopt a temporary or defensive investment posture in
times of generally declining market conditions. Therefore,
investors in the Portfolio will bear the risk of such market
conditions.
The Portfolio intends that, under normal circumstances, at
least 80% of the Portfolio's total assets will be invested in
securities included in the Russell 1000 Growth Index.
See also "Index Portfolio Management" in this Prospectus for
more information on management practices and risks associated
with index-type portfolios.
Small-Cap Value Portfolio
The investment objective of the Small-Cap Value Portfolio is
to achieve long-term capital appreciation by investing
primarily in common stocks, although the Portfolio may also
invest in other securities, including restricted, preferred
stock or foreign securities. In seeking capital appreciation,
consideration will be given to undervalued small and medium
sized companies in industries that demonstrate a strong
<PAGE> 175
<PAGE>
potential for growth, financially strong companies with
distinct market niches offering quality products or services,
outstanding management teams and a proven record of success.
Ariel Capital Management serves as sub-adviser to this
Portfolio. As such, it is responsible for the day-to-day
management of the Portfolio subject to the overall supervision
of the Fund's Board of Directors and the Investment Adviser.
As a means of controlling risk, industries that are believed
to be inherently unpredictable--specifically, cyclical,
commodity-based and start-up industries--will be avoided. The
Portfolio will be constructed on a stock by stock basis with
little attention devoted to the macro-economic outlook of a
particular industry.
The Portfolio will adhere to a disciplined investment
philosophy which incorporates strict guidelines regarding
individual securities. When initiating a position, the
Portfolio will focus on issuers generally ranging in market
capitalization from $50 million to $1.5 billion. As such, the
median market capitalization of the Portfolio is not expected
to exceed $1 billion. Since these companies may be less
widely followed by market analysts, it is believed that they
present greater opportunity for exceptional returns.
Additionally, in keeping with a value approach, the Portfolio
will generally invest in companies whose equities are trading
at an expected price/earnings ratio of 13-1 or less over the
next 12 month's earnings estimate and at a low price relative
to book value, current sales and total assets. Expected
earnings may represent normalized earnings or be adjusted for
amortization of non-cash charges. When executing this
philosophy, assets of the Portfolio will not trade or time the
market for quick gains. Rather, a fully invested portfolio is
maintained by following a conservative philosophy of investing
for the long-term. A security will be sold if it is believed
that its price/earnings multiple reflects that the security
may be over-valued and/or that it is not longer perceived as
having strong potential for growth. Specifically, when a
stock is trading at a price of 19-20 times its forward 12
months earnings estimates, it is believed such stock reflects
popular interest. In keeping with a long-term approach, a
security will not be sold because of a short-term earnings
disappointment. However, a holding will be sold if it is
believed that the company's business has undergone fundamental
changes that will negatively affect its stock price or if
there is a loss of faith in a management's ability to execute
the company's stated goals and objectives.
<PAGE> 176
<PAGE>
The Portfolio may invest in foreign securities offering
potential for growth. Investments in foreign securities
involve risks that differ in some respects from investment in
securities of U.S. issuers. These risks include the risk of
fluctuations in the value of the currencies in which they are
denominated, the risk of adverse political and economic
developments and, with respect to certain countries, the
possibility of expropriation, nationalization or confiscatory
taxation or limitations on the removal of funds or other
assets of the Portfolio. Securities of some foreign companies
are less liquid and more volatile than securities of
comparable domestic companies. There also may be less
publicly available information about foreign issuers than
domestic issuers, and foreign issuers generally are not
subject to the uniform accounting, auditing and financial
reporting standards, practices and requirements applicable to
domestic issuers. Delays may be encountered in settling
securities transactions in certain foreign markets and the
Portfolio will incur costs in converting foreign currencies to
U.S. dollars. Custody charges are generally higher for
foreign securities.
The Portfolio may also invest in money market securities for
temporary or emergency purposes or solely as a cash reserve.
The Portfolio may purchase and write options on securities and
certain futures contracts and invest in certain futures
contracts. The Statement of Additional Information contains
more detailed information about these investment practices.
The Portfolio currently observes the following operating
policies, which may be changed without shareholder approval:
(1) the Portfolio actively seeks to invest in companies that
achieve excellence in both financial return and environmental
soundness, selecting issuers that take positive steps toward
preserving our environment and avoiding companies with poor
environmental records; and (2) the Portfolio will not invest
in issuers primarily engaged in the manufacture of weapons
systems, the production of nuclear energy, or the manufacture
of equipment to produce nuclear energy.
It is believed that there are long-term benefits inherent in
an investment philosophy that demonstrates concerns for the
environment, human rights, economic priorities and
international relations.
The sub-adviser has engaged the services of Franklin Research
and Development Corporation of Boston to provide environmental
screening for all issuers selected for the Portfolio.
Franklin provides information and opinions on the companies'
environmental histories. However, Franklin does not make
<PAGE> 177
<PAGE>
recommendations or provide investment advice concerning the
purchase or sale of securities for the Portfolio.
Small-Cap Aggressive Growth Portfolio
The investment objective of the Small-Cap Aggressive Growth
Portfolio is long-term capital growth. The Small-Cap
Aggressive Growth Portfolio seeks to achieve its objective by
investing in common stocks or their equivalent, emphasizing
securities believed to be undervalued by the market. The
Portfolio may also hold a portion of its assets in cash or
money market instruments. Loomis, Sayles & Company, L.P.
serves as sub-adviser to this Portfolio. As such, it is
responsible for the day-to-day management of the Portfolio
subject to the overall supervision of the Fund's Board of
Directors and the Investment Adviser.
Loomis Sayles seeks to build a core small-cap portfolio of
solid growth companies' stock with a smaller emphasis on
special situations and turnarounds (companies that have
experienced significant business problems but which are
believed to have favorable prospects for recovery), as well as
unrecognized stocks.
In seeking long-term capital growth, the Portfolio will
normally invest at least 65% of its total assets in companies
with market capitalization of less than $1 billion and may
invest up to 35% of its total assets (measured at the time of
acquisition) in larger companies. Current income is not a
consideration in selecting investments for the Portfolio.
Equity securities of companies with relatively small market
capitalization may be more volatile than the securities of
larger, more established companies and the broad equity market
indexes.
The Portfolio may invest a limited portion of its assets in
securities of issuers organized or headquartered outside the
United States. However, such investments cannot exceed 10% of
the Portfolio's total assets (measured at the time of
acquisition). Foreign investments can involve risk, however,
that may not be present in domestic securities. Please see
"Foreign Investment Risks" in this prospectus and the
Statement of Additional Information.
The Portfolio may purchase and write options on securities and
certain futures contracts and invest in certain futures
contracts. The Portfolio may also engage in the following
investment practices each of which may involve certain special
risks: when-issued securities and repurchase agreements. The
<PAGE> 178
<PAGE>
Statement of Additional Information contains more detailed
information about these practices.
Corporate Bond Portfolio
The investment objective of the Corporate Bond Portfolio is
high total investment return through a combination of current
income and capital appreciation. The Corporate Bond Portfolio
seeks to achieve its investment objective by investing in debt
securities (including convertibles), although up to 20% of its
total assets (measured at the time of acquisition) may be
invested in preferred stocks. In achieving high total
investment returns through a combination of current income and
capital appreciation, the Portfolio will normally invest at
least 65% of its total assets in bonds. A limited portion of
its total assets (measured at the time of acquisition) may
also be invested in securities of foreign issuers and up to
35% of its total assets (measured at the time of acquisition)
in securities of below investment grade quality. The
Portfolio may also hold a portion of its assets in cash or
money market instruments. Loomis, Sayles & Company, L.P.
serves as sub-adviser to this Portfolio. As such, it is
responsible for the day-to-day management of the Portfolio
subject to the overall supervision of the Funds' Board of
Directors and the Investment Adviser.
The Portfolio may invest in fixed-income securities of any
maturity. Fixed-income securities pay a specified rate of
interest or dividends, or a rate that is adjusted periodically
by reference to some specified index or market rate. Fixed-
income securities include securities issued by federal, state,
local and foreign governments and related agencies, and by a
wide range of private issuers. Because interest rates vary,
it is impossible to predict the income in fixed-income
securities for any particular period. Therefore, the net
asset value of the Portfolio's shares will vary as a result of
changes in the value of the securities held. Fixed-income
securities are subject to market and credit risk. Market risk
relates to changes in a security's value as a result of
changes in interest rates. In general, the values of fixed-
income securities increase when prevailing interest rates fall
and decrease when interest rates rise. Credit risk relates to
the ability of the issuer to make payments of principal and
interest.
The Portfolio may invest a portion of its assets in securities
rated below investment grade (that is, below BBB by S&P or Baa
by Moody's), including securities in the lowest rating
categories and comparable unrated securities. The Portfolio
may invest up to 35% of its total assets (measured at the time
of acquisition) in such securities. For purposes of this
percentage, a security will be treated as being of investment
<PAGE> 179
<PAGE>
grade quality if at the time it is acquired at least one major
rating agency has rated the security in its top four rating
categories (even if another agency has issued a lower rating),
or if the security is unrated but it is otherwise determined
to be of comparable quality. Lower rated fixed-income
securities generally provide higher yields, but are subject to
greater credit and market risk than higher quality fixed-
income securities. Lower rated fixed-income securities are
considered predominately speculative with respect to the
ability of the issuer to meet principal and interest payments.
Achievement of the investment objective of the Portfolio
investing in lower rated fixed-income securities may be more
dependent on credit analysis than is the case with higher
quality bonds. The market for lower rated fixed-income
securities may be more severely affected than some other
financial markets by economic recession or substantial
interest rate increases, by changing public perceptions of
this market or by legislation that limits the ability of
certain categories of financial institutions to invest in
these securities. In addition, the secondary market may be
less liquid for lower rated fixed-income securities. This
lack of liquidity at certain times may affect the values of
these securities and may make the valuation and sale of these
securities more difficult. Securities of below investment
grade quality are commonly referred to as "junk bonds."
Securities in the lowest rating categories may be in poor
standing or in default. Securities in the lowest investment
grade category (BBB by S&P or Baa by Moody's) have some
speculative characteristics.
The Portfolio may also invest in "zero coupon" fixed-income
securities. These securities accrue interest at a specified
rate, but do not pay interest in cash on a current basis. If
the Portfolio invests in zero coupon securities, it is
required to distribute the income on these securities as the
income accrues, even though the Portfolio is not receiving the
income and cash on a current basis. Thus, the Portfolio may
have to sell other investments to obtain cash to make income
distributions. The market value of zero coupon securities is
often more volatile than that of non-zero coupon fixed-income
securities of comparable quality and maturity.
The Portfolio may also invest in securities of issuers
organized or headquartered outside of the United States. The
Portfolio will not purchase a foreign security if, as a
result, its holdings of foreign securities would exceed 20% of
its total assets (measured at the time of acquisition);
however, the Portfolio may invest any portion of its assets in
securities of Canadian issuers. Foreign investments can
involve risk that may not be present in domestic securities.
Please see "Foreign Investment Risks" in this prospectus.
<PAGE> 180
<PAGE>
The Portfolio may engage in foreign currency exchange
transactions to protect the value of specific positions or in
anticipation of changes in relative values of currencies in
which current or future holdings are denominated or quoted.
Please see "Foreign Currency Exchange Transactions" in this
prospectus.
The Portfolio may purchase Rule 144A securities. These are
privately offered securities that can be resold only to
certain qualified institutional buyers. Rule 144A securities
are treated as illiquid, unless it has been determined that
the particular issue of Rule 144A securities is liquid.
Please see "Illiquid Securities" in this prospectus.
The Portfolio may purchase and write options on securities and
certain futures contracts and invest in certain futures
contracts. The Portfolio may also engage in the following
investment practices each of which involves certain special
risks: collateralized mortgage obligations, when issued
securities and repurchase agreements. The Statement of
Additional Information contains more detailed information
about these practices.
Foreign Equity Portfolio
The investment objective of the Foreign Equity Portfolio is
total return from long-term growth of capital and dividend
income. The Foreign Equity Portfolio seeks to achieve its
objective by investing primarily in international equity
securities. Although the Portfolio seeks to invest primarily
in common stocks, it may also invest in any type of equity
security. Loomis, Sayles & Company, L.P. serves as sub-
adviser to this Portfolio. As such, it is responsible for the
day-to-day management of the Portfolio subject to the overall
supervision of the Fund's Board of Directors and the
Investment Adviser.
In seeking to achieve its investment objective, the Portfolio
will normally invest 65% of its total assets in equity
securities of issuers headquartered outside of the United
States. Under normal conditions, the Portfolio will contain
equity securities of issuers from at least three countries
outside the United States. The Portfolio may also hold a
portion of its assets in cash or money market instruments.
The Portfolio will not limit its investments to any particular
type of company. First, a group of attractively valued
countries will be selected. Within the selected countries,
securities will be selected that are expected to offer the
<PAGE> 181
<PAGE>
best value based on valuation and earnings growth
expectations.
Foreign investments can involve risk, however, that may not be
present in domestic securities. Please see "Foreign Investment
Risks" in this prospectus.
The Portfolio may also, from time to time, invest up to 20% of
its assets in fixed-income securities issued or guaranteed by
foreign governments (including their political subdivisions,
agencies and authorities, and/or instrumentalities), issued by
supranational agencies or issued by foreign companies,
including but not limited to convertible debt and less than
investment grade or non-rated debt. The net asset value of the
Portfolio will vary as a result of changes in the value of
bonds and other fixed-income securities held by the Portfolio.
Fixed-income securities are subject to market and credit risk.
Market risk relates to changes in a security's value as a
result of changes in interest rates generally. Credit risk
relates to the ability of the issuer to make payments of
principal and interest. Securities with a rating which is
less than investment grade are commonly referred to as "junk
bonds." Lower rated fixed-income securities generally provide
higher yields, but are subject to greater credit and market
risks than higher quality fixed-income securities and are
considered predominately speculative with respect to the
ability of the issuer to meet principal and interest payments.
In addition, the secondary market may be less liquid for
lower-rated fixed-income securities which may make the
valuation and sale of the securities more difficult. The
Statement of Additional Information contains more information
about securities ratings.
The Portfolio may invest in convertible securities, including
corporate bonds, notes or preferred stocks that can be
converted into common stocks or other equity securities.
Convertible securities include other securities, such as
warrants, that provide an opportunity for equity
participation. Because convertible securities can be converted
into equity securities, their values will normally vary in
some proportion with those of the underlying equity
securities. Convertible securities usually provide a higher
yield than the underlying equity, however, so that the price
decline of a convertible security may sometimes be less
substantial than that of the underlying equity security. The
value of convertible securities that pay dividends or
interest, like the value of all fixed-income securities,
generally fluctuates inversely with changes in interest rates.
Warrants have no voting rights, pay no dividends and have no
rights with respect to the assets of the corporation issuing
them. They do not represent ownership of the securities for
which they are exercisable, but only the right to buy such
<PAGE> 182
<PAGE>
securities at a particular price. Convertible securities
purchased by the Portfolio may be rated below investment grade
or may be unrated.
The Portfolio may also engage in the following investment
practices each of which involves certain special risks:
transactions in options and certain futures contracts and
repurchase agreements. The Statement of Additional Information
contains more detailed information about these practices.
The Portfolio may engage in foreign currency exchange
transactions to protect against uncertainty in the level of
future exchange rates. Please see "Foreign Currency Exchange
Transactions" in this prospectus.
The Portfolio may invest up to 10% of its assets (measured at
the time of acquisition) in securities of investment companies
which invest primarily in securities issued by foreign
companies. As such, the Portfolio may indirectly bear
investment management fees of such investment companies, which
are in addition to the management fees the Portfolio pays its
adviser.
The Portfolio may purchase "illiquid securities," that is,
securities which are not readily marketable, which includes
securities whose disposition is restricted by federal
securities laws. See "Illiquid Securities" in this
prospectus.
Maxim Blue Chip Portfolio
The investment objective of the Maxim Blue Chip Portfolio is
long-term growth of capital and income. To achieve its
objective, the Portfolio normally will invest primarily in
common stocks of large, well-established, stable and mature
companies, commonly known as "Blue Chip" companies.
"Blue Chip" companies typically have long records of financial
success and dividend payments and a reputation for quality
management, products and services. The Portfolio normally
invests at least 65% of its total assets (measured at the time
of investment) in "Blue Chip" stocks that (1) are included in
a widely recognized index of stock market performance such as
the Dow Jones Industrial Average, the Standard & Poor's 500
Index, or the New York Stock Exchange Index; (2) generally pay
regular dividends; and (3) have a market capitalization of at
least $1 billion. The Portfolio may also invest in non-
dividend paying companies if it is determined they offer
favorable prospects for capital appreciation. The Portfolio
may also invest up to 30% of its total assets (measured at the
time of investment) in foreign securities and may invest,
without limitation, in ADRs. Such investments may enhance
<PAGE> 183
<PAGE>
return, but also involve some special risks. See "Foreign
Investment Risks" in this prospectus.
The Portfolio may purchase and write call and put options and
enter into certain futures contracts on securities, financial
indices and foreign currencies. Such transactions may be
entered into for any number of reasons, including: to manage
its exposure to changes in securities prices and foreign
securities; as an efficient means of adjusting its overall
exposure to certain markets; in an effort to enhance income;
and to protect the value of portfolio securities. See the
Statement of Additional Information for more detailed
information about these investment practices.
The Portfolio may engage in foreign currency exchange
transactions to protect the value of specific positions or in
anticipation of changes in relative values of currencies in
which current or future holdings are denominated or quoted.
See "Foreign Currency Exchange Transactions" in this
prospectus and the Statement of Additional Information for
more detailed information about these practices.
The Portfolio may purchase "illiquid securities," that is,
securities which are not readily marketable, which includes
securities whose disposition is restricted by federal
securities laws. See "Illiquid Securities" in this
prospectus.
The Portfolio may also invest in convertible securities,
preferred stocks, bonds, debentures and other corporate
obligations when it is determined that these investments may
offer opportunities for capital appreciation. The Portfolio
will invest in bonds, debentures, and corporate obligations
only if they are rated investment grade (BBB or higher) at the
time of purchase. The Portfolio may invest in convertible
securities and preferred stocks which are rated in medium and
lower categories by Moody's or S&P (Ba or lower by Moody's and
BB or lower by S&P), but none may be rated lower than B.
Securities rated B generally are less desirable investments
and are deemed speculative as far as the issuer's capacity to
pay interest and repay principal over a long period of time.
Traditionally, convertible securities have paid dividends or
interest at rates higher than common stocks but lower than
non-convertible securities. They generally participate in the
appreciation or depreciation of the underlying stock into
which they are convertible, but to a lesser degree. The
Portfolio may also invest in unrated convertible securities
and preferred stocks if they are deemed to be equivalent in
quality to the rated securities that the Portfolio may buy.
The Portfolio will not invest more than 5% of its total assets
(measured at the time of investment) bonds, debentures,
convertible securities and corporate obligations rated below
<PAGE> 184
<PAGE>
investment grade either at the time of purchase or as a result
of a rating reduction after purchase, or in unrated securities
that are believed to be equivalent in quality to securities
rated below investment grade. This 5% limitation does not
apply to preferred stocks.
All or part of the Portfolio's assets may be invested
temporarily in U.S. and foreign-dollar denominated money
market securities, including repurchase agreements, commercial
paper, bank obligations, certificates of deposit, bankers's
acceptances, other cash equivalents and government securities
if it is determined to be appropriate for purposes of
enhancing liquidity or preserving capital in light of
prevailing market or economic conditions. While in such a
defensive position, the opportunity to achieve capital growth
will be limited, and, to the extent that this assessment of
market conditions is incorrect, the Portfolio will be
foregoing the opportunity to benefit from capital growth
resulting from increases in the value of equity investments.
Maxim MidCap Growth Portfolio
The investment objective of the Maxim MidCap Growth Portfolio
is to provide long-term appreciation by investing primarily in
common stocks of medium-sized (mid-cap) growth companies. To
achieve this objective, the Portfolio will invest at least 65%
of its assets (measured at the time of investment) in a
diversified portfolio of mid-cap companies whose earnings are
expected to grow at a faster rate than the average mid-cap
company.
A mid-cap company is defined as one whose market
capitalization (number of shares outstanding multiplied by
share price) falls within the capitalization range of
companies included in the Standard & Poor's 400 MidCap Index -
generally, between $191 million and $6.5 billion. Mid-cap
growth companies are often in the early, more dynamic phase of
their life cycles, but are no longer considered new or
emerging. Mid-cap companies tend to offer higher growth
prospects than larger companies. At the same time, mid-cap
companies tend to have greater resources, and therefore
represent less risk, than smaller companies. In addition,
mid-cap companies generally have sufficient financial
resources and access to capital to finance their growth.
The Portfolio will attempt to invest primarily in companies
that offer proven products or services; have a historical
record of above-average earnings growth; demonstrate the
potential to sustain earnings growth; operate in industries
experiencing increasing demands; or are believed to be
undervalued in the market place.
<PAGE> 185
<PAGE>
Mid-cap growth stocks entail greater risk and are usually more
volatile than the shares of larger, more established
companies. Since mid-cap companies usually reinvest a high
portion of earnings in their own businesses, they tend to pay
a lesser dividend than larger companies. Also, since
investors buy mid-cap growth stocks because of their expected
superior earnings growth, earnings disappointments often
result in sharp price declines.
The Portfolio may invest in preferred equity, warrants and
debt securities convertible into or exchangeable for equity
securities. Traditionally, convertible securities have paid
dividends or interest at rates higher than common stocks but
lower than non-convertible securities. They generally
participate in the appreciation or depreciation of the
underlying stock into which they are convertible, but to a
lesser degree. Warrants are options to buy a stated number of
shares of common stock at a specified price anytime during the
life of the warrants (generally, two or more years).
The Portfolio may invest up to 25% (measured at the time of
investment) in foreign securities. These include non-dollar
denominated securities traded outside of the U.S. and dollar
denominated securities of foreign issuers traded in the U.S.
Such investments may enhance return, but also involve some
special risks. See "Foreign Investment Risks" in this
prospectus.
The Portfolio may, for non-hedging purposes, invest 10% of its
total assets in hybrid instruments. These instruments (a type
of potentially high-risk derivative) can combine the
characteristics of securities, futures and options. For
example, the principal amount, redemption or conversion terms
of a security could be related to the market price of a
commodity, currency, or securities index. Such securities may
bear interest or pay dividends at low market (or even
relatively nominal) rates. Under certain conditions, the
redemption value of such an investment could be zero. See
also the Statement of Additional Information for more
information about these types of transactions.
The Portfolio may purchase "illiquid securities," that is,
securities which are not readily marketable, which includes
securities whose disposition is restricted by federal
securities laws. See "Illiquid Securities" in this
prospectus.
The Portfolio may purchase and write call and put options and
enter into certain futures contracts on securities and
financial indices. Such transactions may be entered into for
any number of reasons, including: to manage its exposure to
changes in securities prices and foreign securities; as an
<PAGE> 186
<PAGE>
efficient means of adjusting its overall exposure to certain
markets; in an effort to enhance income; and to protect the
value of portfolio securities. See the Statement of
Additional Information for more detailed information about
these investment practices.
The Portfolio may engage in foreign currency exchange
transactions to protect the value of specific positions or in
anticipation of changes in relative values of currencies in
which current or future holdings are denominated or quoted.
See also "Foreign Currency Exchange Transactions" in this
prospectus.
The Portfolio may hold a certain portion of its assets in U.S.
and foreign-dollar denominated money market securities,
including repurchase agreements, high quality corporate bonds
or notes and government securities.
Index Portfolio Management
All index styled portfolios may utilize futures as a
substitute for a comparable market position in the underlying
securities, or for hedging purposes. A stock 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 stock
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 stocks in the index is made. The
intent is to purchase and sell futures contracts so as to
obtain the best price with consideration also given to
liquidity.
Stock index futures contracts may be purchased or sold to the
extent that such activities would be consistent with the
requirements of Section 4.5 of the regulations under the
Commodity Exchange Act, under which the portfolios would be
excluded from the definition of a "commodity pool operator."
Accordingly, each portfolio may enter into futures positions
in such futures contracts to the extent that the aggregate
initial margins and premiums required to establish such
positions do not exceed 5% of the liquidation value of the
respective portfolio.
Risks associated with the use of futures contracts are: (i)
imperfect correlation between the change in value of
securities included on the index and the prices of futures
<PAGE> 187
<PAGE>
contracts; and (ii) possible lack of a liquid secondary market
for a futures position when desired. The risk that a portfolio
will be unable to close out a futures position will be
minimized by entering into such transactions on a national
exchange with an active and liquid secondary market. In
addition, because of the low margin deposits normally required
in futures trading, a high degree of leverage is typical of a
futures trading account.
As a result, a relatively small price movement in a futures
contract may result in substantial losses to the trader (i.e.,
the Portfolio). Traditional methods of securities analysis
are not used by the Investment Adviser in making investment
decisions for index styled portfolios. Rather a statistical
selection technique is utilized to determine which securities
it will purchase or sell in order to track the performance of
the relevant index(es) to the extent feasible. In addition,
from time to time, adjustments may be made in a portfolio's
holdings due to change in the composition of the relevant
index(es). Each index styled portfolio will attempt to
achieve a correlation between its performance and that of the
relevant index(es) of at least 0.95, without taking into
account expenses. A correlation of 1.00 would indicate perfect
correlation, which would be achieved when a portfolio's net
asset value, including the value of its dividends and capital
gains distributions, increases or decreases, is in exact
proportion to change in the relevant index(es). The
Investment Adviser will attempt to minimize any tracing error
(that statistical measure of the difference between the
investment results of a portfolio and that of the relevant
index(es)) in making investments for a portfolio. However,
brokerage and other transaction costs, as well as potential
tracking errors, will tend to cause a portfolio's return to be
lower than the return of the relevant index(es). There can be
no assurance, however, as to how closely a portfolio's
performance will correspond to the performance of the relevant
index(es). Moreover, the index itself may not perform
favorably in which case a Portfolio's performance would
similarly be unfavorable.
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
<PAGE> 188
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 judgements 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.
A Portfolio'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, delays and disruptions in
securities settlement procedures.
Most foreign securities in a Portfolio 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 a Portfolio 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 Portfolio's investments (even
if the price of the investments is unchanged) and changes in
the dollar value of a Portfolio'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 Portfolio's assets and on the net investment income
available for distribution may be favorable or unfavorable.
A Portfolio may incur costs in connection with conversions
between various currencies. In addition, a Portfolio 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 a Portfolio declares and pays a dividend, or between the
time when a Portfolio accrues and pays an operating expense in
U.S. dollars.
Foreign Currency Exchange Transactions
Portfolios which engage in foreign currency exchange
transactions do so in an attempt to protect against
<PAGE> 189
<PAGE>
uncertainty in the level of future exchange rates. Some
Portfolios 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").
A Portfolio may engage in transaction hedging to protect
against a change in foreign currency exchange rates between
the date on which the Portfolio 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, a Portfolio 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 a Portfolio may also purchase
or sell exchange-listed and over-the-counter call and put
options on foreign currency futures contracts and on foreign
currencies.
A Portfolio 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,
quoted or exposed (or an increase in the value of the currency
in which the securities the Portfolio intends to buy are
denominated, when the Portfolio holds cash or short-term
investments). For position hedging purposes, a Portfolio 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, the Portfolio may also purchase or sell foreign
currency on a spot basis.
A Portfolio'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. A
<PAGE> 190
<PAGE>
Portfolio could hedge a foreign currency with forward
contracts on another ("proxy") currency of which changes in
value generally correlate with the currency to be hedged.
Such "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.
A Portfolio 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 denominated. Hedging transactions
may also be limited by tax considerations. Hedging
transactions may affect the character or amount of
distributions.
Illiquid Securities
Each Portfolio, other than the Money Market Portfolio, may
invest up to 15% of its total assets in "illiquid securities"
(taken as of the time of acquisition of an illiquid security).
The Money Market Portfolio may invest up to 10% of its total
assets in illiquid securities. Illiquid securities are
securities that may not be sold in the ordinary course of
business within seven days at approximately the price used in
determining the net asset value of the Portfolio. This
restriction applies to securities for which a ready market
does not exist, such as restricted securities, but does not
necessarily encompass all restricted securities.
Institutional markets for restricted securities have developed
as a result of the promulgation of Rule 144A under the
Securities Act of 1933 which provides a "safe harbor" from
1933 Act registration requirements for qualifying sales to
institutional investors. When Rule 144A securities present an
attractive investment opportunity and otherwise meet selection
criteria, the Portfolios may make such investments. Whether
or not such securities are "illiquid" depends on the market
that exists for the particular security.
The staff of the Securities and Exchange Commission has taken
the position that the liquidity of Rule 144A securities is a
question of fact for a board of directors to determined, such
determination to be based on a consideration of the readily
available trading markets and the review of any contractual
<PAGE> 191
<PAGE>
restrictions. The staff also acknowledges that while the
board retains ultimate responsibility, it may delegate this
function to an investment adviser. The Board of Directors of
the Fund has delegated this responsibility to the Investment
Adviser, and with respect to those Portfolios having a sub-
adviser, the sub-adviser is responsible for determining the
liquidity of Rule 144A securities.
It is not possible to predict with assurance exactly how the
market for Rule 144A securities or any other security will
develop. A security which when purchased enjoyed a fair
degree of marketability may subsequently become illiquid and,
accordingly, a security which was deemed to be liquid at the
time of acquisition may subsequently become illiquid. In such
event, appropriate remedies will be considered to minimize the
effect on a Portfolio's liquidity.
Debt Securities
Bonds and other debt instruments are used by issuers to borrow
money from investors. The issuer pays the investor a fixed or
variable rate of interest, and must repay the amount borrowed
at maturity. Some debt securities, such as zero-coupon bonds,
do not pay current interest, but are purchased at a discount
from their face values. In general, bond prices rise when
interest rates fall, and vice versa. Debt securities have
varying degrees of quality and varying levels of sensitivity
to changes in interest rates. Longer-term bonds are generally
more sensitive to interest rate changes than short-term bonds.
This sensitivity to interest rates is also referred to as
"market risk."
Debt obligations are rated based on their estimated credit
risk by independent services such as S&P and Moody's. "Credit
risk" relates to the ability of the issuer's ability to make
payments of principal and interest when due.
The lower a bond's quality, the more it is subject to credit
risk and market risk and the more speculative it becomes.
This is also true of most unrated debt securities. Investment
grade securities are those rated AAA, AA, A or BBB by S&P or
Aaa, Aa, A or Baa by Moody's or, if unrated, are judged to be
of comparable quality to securities so rated. Debt securities
rated BBB by S&P or Baa by Moody's and unrated securities of
comparable quality are viewed as having adequate capacity for
payment of principal and interest, but do involve a higher
degree of risk than that associated with investments in debt
securities in the higher rating categories.
Securities rated below investment grade are commonly referred
to as "high yield-high risk securities" or "junk bonds".
These securities are considered speculative with respect to
<PAGE> 192
<PAGE>
the issuer's capacity to pay interest and repay principal in
accordance with the terms of the obligations. It is,
therefore, possible that these types of factors could in
certain instances, reduce the value of securities held with a
commensurate effect on share value.
Debt securities include (1) securities issued or guaranteed as
to principal or interest by the U.S. Government, its agencies
or instrumentalities; (2) debt securities issued or guaranteed
by U.S. corporations or other issuers (including foreign
governments or corporations); (3) asset-backed securities and
mortgage-related securities, including collateralized mortgage
obligations ("CMOs"); and (4) securities issued or guaranteed
as to principal or interest by a sovereign government or one
of its agencies or political subdivisions, supranational
entities such as development banks, non-U.S. corporations,
banks or bank holding companies, or other non-U.S. issuers.
MANAGEMENT OF THE FUND
Overall responsibility for management and supervision of the
Fund rests with the Fund's directors. There are currently
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 meets regularly four times
each year and at other times as necessary. By virtue of the
functions performed by GW Capital Management as Investment
Adviser, 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 GWL&A
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.
Investment Adviser
GW Capital Management, 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, the Investment Adviser is controlled by a
Canadian investor, Paul Desmarais, and his associates. The
Investment Adviser 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. GW Capital Management is a
registered investment adviser with the Securities and Exchange
Commission.
<PAGE> 193
<PAGE>
Subject to the supervision and direction of the Fund's Board
of Directors, the Investment Adviser manages the Fund's
portfolios in accordance with each Portfolio's stated
investment objectives and policies, makes investment decisions
for the Portfolios and places orders to buy and sell
securities on behalf of the Fund or delegates these functions
to a sub-adviser, as discussed below. The Investment Adviser
provides investment advisory services and pays all the
expenses, except extraordinary expenses, of the Portfolios
described herein. As compensation for its services to the
Fund, the Investment Adviser receives monthly compensation at
the annual rate of 0.46% of the average daily net assets of
the Money Market Portfolio; 0.60% of the average daily net
assets of the Investment Grade Corporate Bond, Stock Index,
Small-Cap Index, Value Index, Growth Index, U.S. Government
Mortgage Securities, Short-Term Maturity Bond and Total Return
Portfolios; 0.90% of the average daily net assets of the
Corporate Bond Portfolio; and, 1.00% of the average daily net
assets of the Small-Cap Value, Small-Cap Aggressive Growth,
Foreign Equity, Maxim Blue Chip and Maxim MidCap Growth
Portfolios.
With respect to the Small-Cap Value, Small-Cap Aggressive
Growth, Foreign Equity, Maxim MidCap Growth and Maxim Blue
Chip Portfolios, the Investment Adviser pays all compensation
of, and furnishes office space for, officers and employees of
the Investment Adviser connected with investment management of
these Portfolios, as well as the fees of all directors of the
Fund who are affiliated persons of the Investment Adviser or
and of its subsidiaries. All other expenses incurred in the
operation of these Portfolios, including general
administrative expenses are borne by these Portfolios,
respectively. Accounting services are provided for these
Portfolios by the Investment Adviser and these Portfolios
reimburse the Adviser for its costs in connection with such
services. However, the Adviser shall pay any expenses of the
Fund which exceed an annual rate of 1.05% of the average daily
net assets of the Maxim MidCap Growth Portfolio; 1.15% of the
average daily net assets of the Maxim Blue Chip Portfolio;
1.30% of the average daily net assets of the Small-Cap
Aggressive Growth Portfolio; 1.35% of the average daily net
assets of the Small-Cap Value Portfolio; and 1.50% of the
Foreign Equity Portfolio.
The day-to-day lead portfolio manager for the Investment Grade
Corporate Bond Portfolio and the Short-Term Maturity Bond
Portfolio is B.G. Masters. Mr. Masters is Manager, Public
Bond Investments, GWL&A, 1993 to Present; Manager, Bond,
Investment Grade Corporate Bond and Short-Term Maturity Bond
Portfolios of Maxim Series Fund, June 1994 to Present. He was
Assistant Manager, Public Bond Investments, GWL&A, 1987 to
1993.
<PAGE> 194
<PAGE>
The day-to-day lead portfolio manager for the U.S. Government
Mortgage Securities Portfolio is C.S. Tocher. Ms. Tocher is
Manager, Public Bond Investments, GWL&A, 1993 to Present;
Manager, U.S. Government Securities and U.S. Government
Mortgage Securities Portfolio of Maxim Series Fund; June 1994
to Present. She was Associate Manager, Public Bond
Investments, GWL&A, 1990 to 1993; Manager, Bond, Investment
Grade Corporate Bond and Zero-Coupon Treasury Portfolios of
Maxim Series Fund, 1990 to June 1994.
The day-to-day lead portfolio manager for the Total Return
Portfolio is B.D. Squair, C.F.A., Assistant Manager, Capital
Markets Group, The Great-West Life Assurance Company; Manager,
Total Return Portfolio of Maxim Series Fund; Manager,
Great-West Variable Annuity Account A.
Sub-Advisers
Ariel Capital Management, Inc. ( Ariel ) is a privately held
minority-owned money manager registered with the Securities
and Exchange Commission as an investment adviser. It is an
Illinois corporation with its principal business address at
307 North Michigan Avenue, Chicago, Illinois 60601. Subject
generally to review and supervision by the Investment Adviser
and the Board of Directors of the Fund, Ariel is responsible
for the actual daily management of the Small-Cap Value
Portfolio and for making decisions to buy, sell or hold any
particular security.
Ariel bears all expenses in connection with the performance of
its services, such as compensating and furnishing office space
for its officers and employees connected with investment and
economic research, trading and investment management of the
Small-Cap Value Portfolio.
The day-to-day manager for the Small-Cap Value Portfolio is
John W. Rogers, Jr. Mr. Rogers' business experience during
the past five years is as Chief Investment Officer, Ariel
Capital Management and Portfolio Manager, Calvert-Ariel Growth
Fund.
The Investment Adviser is responsible for compensating Ariel,
which receives monthly compensation from the Investment
Adviser at the annual rate of .40% of the average daily net
asset value of the Small-Cap Value Portfolio up to $5 million,
.35% on the next $10 million, .30% on the next $10 million,
and .25% of such value in excess of $25 million.
<PAGE> 195
<PAGE>
Loomis, Sayles & Company, L.P. ("Loomis Sayles") is the sub-
adviser of the Small-Cap Aggressive Growth, Corporate Bond and
Foreign Equity Portfolios. As such, Loomis Sayles is
responsible for daily managing the investment and reinvestment
of assets of the Portfolios, subject generally to review and
supervision of the Investment Adviser and the Board of
Directors. Loomis Sayles bears all expenses in connection
with the performance of its services, such as compensating and
furnishing office space for its officers and employees
connected with the investment and economic research, trading
and investment management of the Portfolios.
Loomis Sayles is a Delaware limited partnership, registered as
an investment adviser with the Securities and Exchange
Commission. Its principal business address is One Financial
Center, Boston, Massachusetts 02111.
Jeffrey C. Petherick, Vice President of Loomis, Sayles &
Company, L.P. ("Loomis Sayles"), and Mary Champagne, Vice
President of Loomis Sayles, have day-to-day management
responsibility for the Small-Cap Aggressive Growth Portfolio.
Mr. Petherick has co-managed the Portfolio since the
Portfolio's inception. Mr. Petherick joined Loomis Sayles in
1990. Ms. Champagne has co-managed the Portfolio since July
1995. Prior to joining Loomis Sayles in 1993, Ms. Champagne
served as a portfolio manager at NBD Bank for 10 years.
The day-to-day manager of the Corporate Bond Portfolio is
Daniel J. Fuss, Executive Vice President of Loomis Sayles who
also serves as the fund manager of the Loomis Sayles Bond
Fund. Mr. Fuss has served as the portfolio manager of the
Loomis Sayles Bond Fund since its inception in 1991.
The day-to-day manager of the Foreign Equity Portfolio is Paul
Drexler, Vice President of Loomis Sayles who also serves as
the fund manager of the Loomis Sayles International Equity
Fund (since 1996) and the New England International Equity
Fund (since 1997).
The Investment Adviser is responsible for compensating Loomis
Sayles, which receives monthly compensation from the
Investment Adviser at the annual rate of .50% on the first $10
million, .45% on the next $15 million, .40% on the next $75
million and .30% on all amounts over $100 million of the
Small-Cap Aggressive Growth Portfolio; .30% on all assets of
the Corporate Bond Portfolio; and, .60% on the first $10
million, .50% on the next $40 million, and .35% on amounts
over $50 million on the Foreign Equity Portfolio.
Founders Asset Management, Inc. ("Founders") serves as the
sub-adviser to the Maxim Blue Chip Portfolio. As such,
Founders is responsible for daily management of the investment
<PAGE> 196
<PAGE>
and reinvestment of assets of the Maxim Blue Chip Portfolio,
subject generally to review and supervision of the Investment
Adviser and the Board of Directors. Founders bears all
expenses in connection with the performance of its services,
such as compensating and furnishing office space for its
officers and employees connected with investment and economic
research, trading and investment management for the Maxim Blue
Chip Portfolio.
Founders is a Delaware corporation, registered as an
investment adviser with the Securities and Exchange
Commission. Its principal business address is 2930 East Third
Avenue, Denver, Colorado 80206.
The day-to-day manager of the Maxim Blue Chip Portfolio is
Brian F. Kelly. Mr. Kelly also serves as the lead portfolio
manager for the Founders Blue Chip and Balanced Funds. Mr.
Kelly joined Founders in 1996. Prior to joining Founders, Mr.
Kelly served as a portfolio manager (1993 - 1996) for INVESCO
Trust Company, and as a senior equity investment analyst for
Sears Investment Management Company (1986 - 1993).
The Investment Adviser is responsible for compensating
Founders, which receives monthly compensation from the
Investment Adviser at the annual rate of .425% on the first
$250 million, .35% on the next $250 million, .325% on the next
$250 million and .30% on all amounts over $750 million.
T. Rowe Price Associates, Inc. ("T. Rowe Price") serves as
the sub-adviser to the Maxim MidCap Growth Portfolio. As
such, T. Rowe Price is responsible for daily management of the
investment and reinvestment of assets of the Portfolio,
subject generally to review and supervision of the Investment
Adviser and the Board of Directors. T. Rowe Price bears all
expenses in connection with the performance of its services,
such as compensating and furnishing office space for its
officers and employees connected with the investment and
economic research, trading and investment management of the
Maxim MidCap Growth Portfolio.
T. Rowe Price is a Maryland corporation, registered as an
investment adviser with the Securities and Exchange
Commission. Its principal address is 100 East Pratt Street,
Baltimore, Maryland 21202.
The Maxim MidCap Growth Portfolio is managed by an investment
advisory committee comprised of the following members: Brian
W. H. Berghuis, Chairman, Marc L. Baylin, James A. C. Kennedy,
and John S. Wakeman. The committee chairman has day-to-day
responsibility for managing the Portfolio and works with the
committee in developing and executing the Portfolio's
investment program. This investment committee also serves as
<PAGE> 197
<PAGE>
the investment committee for the T. Rowe Price MidCap Growth
Portfolio. Mr. Berghuis has been Chairman of the T. Rowe
Price MidCap Growth Fund since 1992. He has been managing
investments since joining T. Rowe Price in 1985.
The Investment Adviser is responsible for compensating T. Rowe
Price, which receives monthly compensation from the Investment
Adviser at the annual rate of .50% on all assets of the Maxim
MidCap Growth Portfolio.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Dividends from investment income of the Money Market Portfolio
shall be declared daily and reinvested monthly in additional
shares of the Portfolio at net asset value. Dividends from
investment income of the Investment Grade Corporate Bond, U.S.
Government Mortgage Securities and Short-Term Maturity Bond
Portfolios shall be declared and reinvested quarterly.
Dividends from net investment income of the Stock Index,
Small-Cap Index, Growth Index, Value Index, Small-Cap Value,
Total Return, Maxim Blue Chip, Maxim MidCap Growth and
Corporate Bond Portfolios shall be declared and reinvested
semi-annually. Dividends from net investment income of the
Small-Cap Aggressive Growth and Foreign Equity Portfolios
shall be declared and reinvested annually. Distributions of
net realized capital gains, if any, are declared in the fiscal
year in which they have been earned and are reinvested in
additional shares of the Fund 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 the Series
Accounts of GWL&A and MetLife. 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/MetLife and the
Series Accounts, see "Federal Tax Considerations" included in
the applicable Series Account prospectus.
PURCHASE AND REDEMPTION OF SHARES
Shares of the Fund are sold and redeemed at their net asset
value next determined after initial receipt of a purchase
order or notice of redemption without the imposition of any
sales commission or redemption charge. However, certain
<PAGE> 198
<PAGE>
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 once daily Monday through Friday, except on
holidays on which the New York Stock Exchange is closed.
Net asset value of a portfolio share is computed by dividing
the value of the net assets of the portfolio by the total
number of portfolio shares outstanding. Portfolio securities
that are listed on an established securities exchange or on
the NASDAQ National Market System are valued at the last sale
price as of the close of business on the day the securities
are being valued, or, lacking any sales, at the mean between
closing bid and asked price. Securities traded in the
over-the-counter market are valued at the mean between the bid
and asked prices or yield equivalent as obtained from one or
more dealers that make markets in the securities. Portfolio
securities that are traded both in the over-the-counter market
and on an exchange are valued according to the broadest and
most representative market. Securities and assets for which
market quotations are not readily available are valued at fair
value as determined in good faith by or under the direction of
the Board of Directors, including valuations furnished by a
pricing service that may be retained by the Fund.
Market quotations of foreign securities in foreign currency
are translated to U.S. dollars at the prevailing rate of
exchange. Securities for which market quotations are not
readily available and other assets are valued at fair value as
determined in good faith by the Board of Directors. Such a
determination may take into account, for example, quotations
by dealers or issuers for securities of similar type, quality,
and maturity, or valuations furnished by a pricing service
retained by the Fund.
Money market securities held by the Fund with 60 days or less
remaining to maturity are valued on an amortized cost basis,
which involves valuing a portfolio instrument at its cost
initially and thereafter assuming a constant amortization to
maturity of any discount or premium, regardless of the impact
of fluctuating interest rates on the market value of the
instrument. While this method provides certainty in
valuation, it may result in periods during which value, as
determined by amortized cost, is higher or lower than the
price the Fund would receive if it sold the security.
THE FUND AND ITS SHARES
<PAGE> 199
<PAGE>
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 an 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 of MetLife, and The
Great-West Life Assurance Company, which provided the Fund's
initial capitalization, will be holders of the shares and be
entitled to exercise the rights directly as described in the
applicable Series Account prospectus.
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.
PERFORMANCE RELATED INFORMATION
The Fund may advertise certain performance related
information. Performance information about the Fund is based
on the Fund'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 Portfolios. When the Fund
advertises the total return of one of these portfolios, it
will usually be calculated for one year, five years, and ten
years or some other relevant period if the Fund has not been
in existence for at least ten years. Total return is measured
by comparing the value of an investment in the portfolio at
<PAGE> 200
<PAGE>
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).
Some of the Portfolios may also advertise their 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 Fund share
(reduced by any dividend expected to be paid shortly out of
Fund income) on the last day of the period.
The Money Market Portfolio may advertise its yield and
effective yield. The yield of the Money Market Portfolio is
based upon the income earned by the Portfolio over a seven-day
period and then annualized, i.e., the income earned in the
period is assumed to be earned every seven days over a 52-week
period and stated as a percentage of the investment. Effective
yield is calculated similarly but, when annualized, the income
earned by the investment is assumed to be reinvested in
portfolio shares and thus compounded in the course of a
52-week period.
<PAGE> 201
<PAGE>
YIELDS
Yield (and effective yield, in the case of the Money Market
Portfolio) will fluctuate, and publication of yield
information may not provide a basis for comparison with bank
deposits, securities of other investment companies or other
investments which are insured and/or pay a fixed yield for a
stated period of time. In addition, the yield and effective
yield information may be of limited use for comparative
purposes because it does not reflect charges imposed at the
Series Account level which, if included, would decrease the
yield. Moreover, the yields shown reflect past performance
only and are not intended to indicate, predict or guarantee
future performance.
<TABLE>
<CAPTION>
Yield** Effective Yield**
<S> <C> <C>
MONEY MARKET PORTFOLIO 4.95% 5.08%
Comparison Information (1) 5.02%
INVESTMENT GRADE CORPORATE
BOND PORTFOLIO 5.99%
U.S. GOVERNMENT MORTGAGE
SECURITIES PORTFOLIO 9.69%
TOTAL RETURN PORTFOLIO 2.57%
STOCK INDEX PORTFOLIO 1.48%
SMALL-CAP INDEX PORTFOLIO 1.54%
GROWTH INDEX PORTFOLIO 1.32%
VALUE INDEX PORTFOLIO 1.83%
SMALL-CAP VALUE PORTFOLIO 1.78%
CORPORATE BOND PORTFOLIO 7.31%
SMALL-CAP AGGRESSIVE
GROWTH PORTFOLIO 1.74%
FOREIGN EQUITY PORTFOLIO 0.73%
SHORT-TERM MATURITY
BOND PORTFOLIO 5.28%
</TABLE>
**Yield and effective yield for the Money Market Portfolio is
for the 7-day period ended December 31, 1996. Yield for the
other Portfolios is for the month ended December 31, 1996. All
the yield and effective yield calculations above take into
account charges against the Portfolio. All yield and effective
yield information is annualized.
<PAGE> 202
<PAGE>
(1) The Donoghue MONEY FUND AVERAGE lists 772 taxable money funds
that are available to individual investors.
TOTAL RETURNS
All total return calculations assume the full redemption of
the Portfolio at the end of the period for which the
calculation was made. These returns also reflect annual
returns over the period indicated. For information on the
method used to calculate the above returns see the Statement
of Additional Information. The performance shown reflects
past performance only and is not intended to indicate, predict
or guarantee future performance. Total return information,
however, may be of limited use for comparative purposes
because it does not reflect charges imposed at the Series
Account level which, if included, would decrease total return.
<PAGE> 203
<PAGE>
<TABLE>
<CAPTION>
One Five
Year Year
<S> <C> <C>
INVESTMENT GRADE CORPORATE
BOND PORTFOLIO 3.14% N/A
Comparison Information (2)3.97% 7.87%
U.S. GOVERNMENT MORTGAGE
SECURITIES PORTFOLIO 4.30% N/A
Comparison Information (6)5.35% 6.71%
TOTAL RETURN PORTFOLIO 11.76% 9.56%
Comparison Information (4)13.01% 11.13%
STOCK INDEX PORTFOLIO+ 21.81% 13.98%
Comparison Information (3) 22.96%15.22%
SMALL-CAP INDEX PORTFOLIO15.30% N/A
Comparison Information (5)16.49% 15.64%
GROWTH INDEX PORTFOLIO 22.09% N/A
Comparison Information (7)23.12% 13.38%
VALUE INDEX PORTFOLIO 17.18% N/A
Comparison Information (8)21.37% 19.17%
SMALL-CAP VALUE PORTFOLIO17.95% N/A
Comparison Information (3) 22.96% 15.22%
CORPORATE BOND PORTFOLIO 10.37% N/A
Comparison Information (10)2.91% 7.23%
FOREIGN EQUITY PORTFOLIO 7.62% N/A
Comparison Information (9)6.36% 8.48%
SMALL-CAP AGGRESSIVE
GROWTH PORTFOLIO 30.09% N/A
Comparison Information (5) 16.49% 15.64%
SHORT-TERM MATURITY
BOND PORTFOLIO 4.70% N/A
Comparison Information (11)5.08% 5.56%
<PAGE> 204
<PAGE>
Ten Since++
Year Inception
<S> <C> <C>
INVESTMENT GRADE CORPORATE
BOND PORTFOLIO N/A 6.36%
Comparison Information (2) 8.70%
U.S. GOVERNMENT MORTGAGE
SECURITIES PORTFOLIO N/A 6.93%
Comparison Information (6) 8.78%
TOTAL RETURN PORTFOLIO N/A 9.37%
Comparison Information (4) 11.19%
STOCK INDEX PORTFOLIO+ 12.99%
Comparison Information (3) 15.29%
SMALL-CAP INDEX PORTFOLIO N/A 11.64%
Comparison Information (5) 12.41%
GROWTH INDEX PORTFOLIO N/A 18.71%
Comparison Information (7) 15.43%
VALUE INDEX PORTFOLIO N/A 20.64%
Comparison Information (8) 13.67%
SMALL-CAP VALUE PORTFOLIO N/A 10.74%
Comparison Information (3) 15.29%
CORPORATE BOND PORTFOLIO N/A 17.39%
Comparison Information (10) x.xx%
FOREIGN EQUITY PORTFOLIO N/A 3.41%
Comparison Information (9) 8.74%
SMALL-CAP AGGRESSIVE
GROWTH PORTFOLIO N/A 25.97%
Comparison Information (5) 12.41%
SHORT-TERM MATURITY
BOND PORTFOLIO N/A 5.48%
Comparison Information (11) 7.18%
</TABLE>
(2) The Lehman Brothers Intermediate Corporate Bond Index is an
index of all investment grade publicly traded issues of at
least $100 million outstanding with maturities ranging from 1
to 10 years
(3) The S&P 500 Index is an index comprised of 500 stocks chosen
for their general representation of the stock market
composition by Standard & Poor's Corporation.
(4) The Lipper Analytical Services Inc. Balanced Fund Survey is a
survey of approximately 61 balanced funds.
(5) The Russell 2000 Index is an index which tracks a broadly
diversified group of small capitalization domestic stocks.
<PAGE> 205
<PAGE>
(6) The Lehman Brothers Mortgage-Backed Index is an index of 15-
and 30-year fixed rate mortgages backed by mortgage pools of
GNMA, FNMA and FHLMC. Balloons are also included in the
Index.
(7) The Russell 1000 Growth Index is comprised of stocks from the
Russell 1000 Index with greater-than average growth
orientation. The Russell 1000 Index consists of the 1000
largest stocks with the Russell 3000 Index. The Russell 3000
Index is an index which represents approximately 98% of the
total market capitalization of all U.S. stocks that trade on
the New York and American Stock Exchanges and in the NASDAQ
over-the-counter market.
(8) The Russell 1000 Value Index is comprised of stocks from the
Russell 1000 Index with greater-than average value
orientation. The Russell 1000 Index consists of the 1000
largest stocks with the Russell 3000 Index.
(9) The Morgan Stanley Capital International EAFE Index is an index
which tracks stocks from Europe, Australia and the Far East.
(10) The Merrill Lynch Government/Corporate Index is a broad-based
bond index of investment grade publicly traded issues.
(11) The Lehman Brothers (1-3 Year) Government/Corporate Bond Index
is an index of all investment grade government/corporate
issues of at least $100 million outstanding with maturities of
1 to 3 years.
+From September 24, 1984 until December 1, 1992, the Stock
Index Portfolio was named the Growth Portfolio and prior to
September 24, 1984, was named the Income/Equity Portfolio.
During these periods, the Portfolio's investment policies
differed from the Stock Index Portfolio's current policies.
++The Total Return Portfolio was established effective July
29, 1987. The Investment Grade Corporate Bond, U.S. Government
Mortgage Securities were established effective December 1,
1992. The Small-Cap Index, Growth Index and Value Index, and
Small-Cap Value Portfolios were established effective December
1, 1993. The Small-Cap Aggressive Growth, Corporate Bond and
Foreign Equity Portfolios were established effective November
1, 1994. The Short-Term Maturity Bond Portfolio was
established effective August 1, 1995.
GENERAL INFORMATION
Reports to Shareholders
The fiscal year of the Fund ends on December 31 of each year.
The Fund will send to its shareholders, at least semiannually,
<PAGE> 206
<PAGE>
reports showing performance of the Fund's Portfolios and other
information. An annual report, containing financial
statements, audited by independent certified public
accountants, will be sent to shareholders each year.
Custodian
Bank of New York ("BONY"), New York City, New York, acts as
custodian of the Fund's assets. BONY has custody of the
Fund's assets held within and outside the United States. BONY
holds the Fund's assets in safekeeping and collects and remits
the income thereon subject to the instructions of the Fund.
Independent Auditors
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.
Legal Counsel
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> 207
<PAGE>
PART B
<PAGE> 208
<PAGE>
___________________________________________________________
MAXIM SERIES FUND, INC.
___________________________________________________________
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.
___________________________________________________________
G W CAPITAL MANAGEMENT, INC.
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
May 1, 1997
<PAGE> 209
<PAGE>
TABLE OF CONTENTS
Cross-reference
to page(s) in
Page Prospectus
Sale of Shares 3 38/39
The Fund Portfolios 3 17/16
Description of Investment
Securities 3 17-32/16-35
Information About Securities
Ratings 9 17-32/16-35
Investment Limitations 11 17-32/16-35
Foreign Securities 18 17-32/16-35
Lending of Portfolio
Securities 19 17-32/16-35
Management of the Fund 20 32/35
Directors and Officers 20 --
The Investment Adviser 21 32/36
The Sub-Advisers 22 33/37
Portfolio Transactions and
Brokerage 25 32/36
Portfolio Turnover 26 --
Placement of Portfolio
Brokerage 26 32/36
Purchase and Redemption of Shares 27 36/39
Calculation of Yield and Return 34 37/40
Price Make-Up Sheets 67 --
Financial Statements 88 --
SALE OF SHARES
Shares of the Fund are sold to the FutureFunds Series Account,
Maxim Series Account and Retirement Plan 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 Metropolitan Life Insurance Company ("MetLife") to
<PAGE> 210
<PAGE>
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 with three portfolios, the Money Market, Bond
and Income/Equity Portfolios. Pursuant to shareholders'
approval, the investment objectives of the Income/Equity
Portfolio were changed to that of a growth-type portfolio and
it was renamed the Growth Portfolio effective September 24,
1984. Subsequently, the investment objectives of the Growth
Portfolio were again changed to that of an index-type
portfolio and it was renamed the Stock Index Portfolio
effective December 1, 1992. The Government Guaranteed
Portfolio was added effective January 30, 1985. Subsequently,
pursuant to approval of the shareholders, the investment
objectives of the Government Guaranteed Portfolio were changed
and it was renamed the Government and High Quality Securities
Portfolio effective July 29, 1987. Pursuant to approval of
the shareholders, the investment objectives of the Government
and High Quality Securities Portfolio were changed and it was
renamed the U.S. Government Securities Portfolio effective May
1, 1990. The Total Return Portfolio was added July 29, 1987.
The Investment Grade Corporate Bond and the U.S. Government
Mortgage Securities Portfolios were added effective December
1, 1992. The Small-Cap Index, Value Index, Growth Index,
Small-Cap Value and International Equity Portfolios were added
effective December 1, 1993. The Mid-Cap Portfolio was added
effective January 3, 1994. The Corporate Bond, Small-Cap
<PAGE> 211
<PAGE>
Aggressive Growth, Foreign Equity, Maxim T. Rowe Price
Equity/Income, Maxim INVESCO Small-Cap Growth and Maxim
INVESCO ADR Portfolios were added effective November 1, 1994.
The Short-Term Maturity Bond Portfolio was added effective
August 1, 1995. The Maxim INVESCO Balanced Portfolio was
added effective October 1, 1996. The Maxim MidCap Growth and
Maxim Blue Chip Portfolios were added effective May 1, 1997.
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.
<PAGE> 212
<PAGE>
2.Bankers' Acceptance. A bankers' acceptance is a time 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 case 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
<PAGE> 213
<PAGE>
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
<PAGE> 214
<PAGE>
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 market 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 is an agreement between
two parties in which one party is obligated to deliver a
stated amount of a stated asset at a specified time in the
future and the other party is obligated to pay a specified
amount for the assets at the time of delivery. When used with
foreign currency exchange transactions, a forward contract
<PAGE> 215
<PAGE>
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 decline
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. Forward contracts generally
are traded in an interbank market conducted directly between
traders (usually large commercial banks) and their customers.
Unlike futures contracts, which are standardized contracts,
forward contracts can be specifically drawn to meet the need
of the parties that enter into them. The parties to a forward
contract may agree to offset or terminate the contract before
its maturity, or may hold the contract to maturity and
complete the contemplated exchange.
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
<PAGE> 216
<PAGE>
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.Interest Rate Transactions. Interest rate swaps and interest
rate caps and floors are types of hedging transactions which
are utilized to attempt to protect the Portfolio against and
potentially benefit from fluctuations in interest rates and to
preserve a return or spread on a particular investment or
portion of the Portfolio's holdings. These transactions may
also be used to attempt to protect against possible declines
in the market value of the Portfolio's assets resulting from
downward trends in the debt securities markets (generally due
to a rise in interest rates) or to protect unrealized gains in
the value of the Portfolio's holdings, or to facilitate the
sale of such securities.
Interest rate swaps involve the exchange with another party of
commitments to pay or receive interest; e.g., an exchange of
fixed rate payments for variable rate payments. The purchase
of an interest rate cap entitles the purchaser, to the extent
that a specified index exceeds a predetermined interest rate,
to receive payments of interest on a notional principal amount
from the party selling such interest rate cap. The purchase
of an interest rate floor entitles the purchaser, to the
extent that a specified index falls below a predetermined
interest rate, to receive payments of interest on a notional
principal amount from the party selling such interest rate
floor.
The successful utilization of interest rate transactions
depends on the Portfolio manager's ability to predict
correctly the direction and degree of movements in interest
rates. If the Portfolio manager's judgment about the
direction or extent of movement in interest rates is
incorrect, the Portfolio's overall performance would be worse
than if it had not entered into such transactions. For
example, if the Portfolio purchases an interest rate swap or
an interest rate floor to hedge against the expectation that
interest rates will decline but instead interest rates rise,
the Portfolio would lose part or all of the benefit of the
increased payments it would receive as a result of the rising
interest rates because it would have to pay amounts to its
counterparts under the swap agreement or would have paid the
purchase price of the interest rate floor.
The swap market has grown substantially in recent years with a
large number of banks and investment banking firms acting both
<PAGE> 217
<PAGE>
as principals and as agents utilizing standardized swap
documentation. Caps and floors are more recent innovations
for which standardized documentation has not yet been
developed and, accordingly, they are less liquid than swaps.
Interest rate swaps, caps and floors are considered by the
Staff of the Securities and Exchange Commission to be illiquid
securities and, therefore, the Portfolio may not invest more
than 15% of its assets in such instruments. Finally, there
can be no assurance that the Portfolio will be able to enter
into interest rate swaps or to purchase interest rate caps or
floors at prices or on terms the Portfolio manager believes
are advantageous to the Portfolio. In addition, although the
terms of interest rate swaps, caps and floors may provide for
termination, there can be no assurance that the Portfolio will
be able to terminate an interest rate swap or to sell or
offset interest rate caps or floors that it has purchased.
14.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 15% (together with other
illiquid investments) of a purchaser's total assets.
Although repurchase transactions usually do not impose 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 value 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.
<PAGE> 218
<PAGE>
15.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.
16.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.
<PAGE> 219
<PAGE>
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 recordkeeping 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.
17.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 that 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.
18.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.
19.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.
20.Warrants. Warrants are pure speculation in that they have no
voting rights, pay no dividends and have no rights with
respect to the assets of the corporation issuing them.
Warrants basically are options to purchase equity securities
at a specific price valid for a specific period of time. They
do not represent ownership of the securities, but only the
right to buy them. Warrants differ from call options in that
warrants are issued by the issuer of the security which may be
purchased on their exercise, whereas call options may be
<PAGE> 220
<PAGE>
written or issued by anyone. The prices of warrants do not
necessarily move parallel to the prices of the underlying
securities.
21.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 or
other liquid assets 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).
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.
<PAGE> 221
<PAGE>
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 which 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.
Caa - Bonds which are rated Caa are of poor standing. Such issues
may be in default or there may be present elements of danger
with respect to principal or interest.
Ca - Bonds which are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in
default or have other marked shortcomings.
C - Bonds which are rated C are the lowest rated class of bonds,
and issues so rated can be regarded as having extremely poor
prospects of ever attaining any real investment standing.
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.
<PAGE> 222
<PAGE>
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, CCC, and CC - Standard & Poor's describes the BB, B, CCC and
CC 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.
C - The rating C is reserved for income bonds on which no interest
is being paid.
D - Bonds rated D are in default, and payment of interest and/or
repayment of principal is in arrears.
Plus (+) or Minus (-): The ratings from "AA" to "B" may be
modified by the addition of a plus or minus sign to show
relative standing within the major rating categories.
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
<PAGE> 223
<PAGE>
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 on the investment activity of its
Portfolios 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 Fund, including a
majority of the shares of each Portfolio affected by the
change. These limitations apply to all Portfolios except the
Maxim T. Rowe Price Equity/Income, Maxim MidCap Growth, Maxim
INVESCO Balanced, and Maxim Blue Chip Portfolios. Please see
descriptions starting on page 14 of the investment limitations
applicable to these Portfolios. If only one Portfolio is
affected, only shares of that Portfolio are entitled to vote.
"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
<PAGE> 224
<PAGE>
the outstanding shares. A complete statement of all such
limitations are set forth below.
The Fund (i.e., each Portfolio) will not:
1.(a) Invest more than 15% of its total assets (taken at market
value at the time of each investment) in obligations
(excluding repurchase agreements) of any one bank, or, with
respect to 75% of its assets, invest more than 5% of such
assets in the securities (other than United States Government
or government agency securities) of any one issuer other than
a bank (but including repurchase agreements with any one
bank); and (b) purchase more than either (i) 10% in principal
amount of the outstanding debt securities of an issuer, or
(ii) 10% of the outstanding voting securities of an issuer,
except that such restrictions shall not apply to securities
issued or guaranteed by the United States Government or its
agencies, bank money instruments or bank repurchase
agreements. Under the diversification requirements of the
Investment Company Act of 1940 applicable to diversified
investment companies, such as the Fund, the Fund may not
invest more than 5% of the value of its total assets in the
securities of any one issuer (except that this statutory
restriction does not apply with respect to 25% of the value of
an investment company's total assets). Under the Fund's
current interpretation of the statutory diversification tests,
bank obligations of the type in which the Fund invests are not
subject to this 5% limitation and thus the Fund's only
limitation in this regard is the 15% limitation set forth
above. The staff of the Securities and Exchange Commission,
however, has taken the position that certain bank obligations
are subject to the statutory 5% limitation, and further action
by the Commission may make it necessary that the Fund revise
its investments in bank obligations so as not to exceed the 5%
limitation in order for the Fund to maintain its status as a
diversified company. This investment restriction does not
apply to the Investment Grade Corporate Bond, U.S. Government
Mortgage Securities or Short-Term Maturity Bond Portfolios.
2. 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.
<PAGE> 225
<PAGE>
3.Alone or together with any other investor make investments for
the purpose of exercising control over, or management of any
issuer.
4.Purchase securities of other investment companies, except in
connection with a merger, consolidation, acquisition or
reorganization, or by purchase in the open market of
securities of closed-end investment companies where no
underwriter or dealer's commission or profit, other than
customary broker's commission, is involved, and only if
immediately thereafter not more than 10% of such Fund's total
assets, taken at market value, would be invested in such
securities; and except that the Foreign Equity Portfolio may
invest up to 10% of its total assets at the time of
acquisition in securities of any investments companies. This
investment restriction does not apply to the Short-Term
Maturity Bond Portfolio.
5.Purchase or sell interests in commodities, commodities
contracts, oil, gas or other mineral exploration or
development programs, or real estate, except that the Fund may
purchase securities of issuers which invest or deal in any of
the above; provided, however, that the Bond, Stock Index,
Small-Cap Index, Growth Index, Value Index, MidCap,
International Equity, Small-Cap Value, Corporate Bond, Foreign
Equity, Small-Cap Aggressive Growth, Maxim INVESCO Small-Cap
Growth, Maxim INVESCO ADR and Short-Term Maturity Bond
Portfolios may invest in futures contracts based on financial
indices, foreign currency transactions and options on
permissible futures contracts.
6.Purchase securities for the Fund 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 such Fund's net assets (15% for the
Maxim INVESCO Small-Cap Growth and Maxim INVESCO ADR
Portfolios). This investment restriction does not apply to
the Short-Term Maturity Bond Portfolio.
7.Purchase any securities on margin (except that the Fund may
obtain such short-term credit as may be necessary for the
clearance of purchases and sales of portfolio securities, and
the Bond, Stock Index, Small-Cap Index, Value Index, Growth
Index, International Equity, Small-Cap Value, MidCap,
Corporate Bond, Short-Term Maturity Bond, Small-Cap Aggressive
Growth, Foreign Equity, Maxim INVESCO Small-Cap Growth and
Maxim INVESCO ADR Portfolios may make margin payments in
connection with transactions in currency futures contracts) or
make short sales of securities or maintain a short position.
8.Make loans, except as provided in limitation (9) below and
except through the purchase of obligations in private
<PAGE> 226
<PAGE>
placements (the purchase of publicly-traded obligations are
not being considered the making of a loan).
9.Lend its portfolio securities in excess of 20% 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",
in this Statement of Additional Information (33 1/3% for the
Short-Term Maturity Bond Portfolio).
10.Borrow amounts in excess of 10% of its total assets, 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%. As a matter of policy,
all borrowings will be repaid before any investments are made.
11.Mortgage, pledge, hypothecate or in any manner transfer, as
security for indebtedness, any securities owned or held by the
Fund except as may be necessary in connection with borrowings
mentioned in limitation (10) above, and then such mortgaging,
pledging or hypothecating may not exceed 10% of the Fund's
total assets, taken at market value at the time thereof. The
Fund will not, as a matter of operating policy, mortgage,
pledge or hypothecate its portfolio securities to the extent
that at any time the percentage of the value of pledged
securities will exceed 10% of the value of the Fund's shares.
This restriction does not apply to segregated accounts.
12.Underwrite securities of other issuers except insofar as the
Fund may be deemed an underwriter under the Securities Act of
1933 in selling portfolio securities.
13.Write, purchase or sell puts, calls or combinations thereof,
except that the Bond, Small-Cap Index, Value Index, Growth
Index, MidCap, International Equity, Small-Cap Value,
Corporate Bond, Small-Cap Aggressive Growth, Foreign Equity,
Short-Term Maturity Bond, Maxim INVESCO Small-Cap Growth and
Maxim INVESCO ADR Portfolios may buy and sell put and call
options (and any combination thereof) on securities (including
index options), on index futures contracts, on securities
indices, and on foreign currencies (to the extent a Portfolio
may invest in foreign currencies) and may buy and sell put and
call warrants, the values of which are based upon securities
indices. In addition, the Bond Portfolio may buy and sell put
and call options ( and any combination thereof) on permissible
futures contracts.
14.Sell securities short or purchase securities on margin.
<PAGE> 227
<PAGE>
15.Invest in securities of foreign issuers if at the time of
acquisition more than 10% of its total assets, taken at market
value at the time of investment, would be invested in such
securities. However, up to 25% of the total assets of a
Portfolio may be invested in securities (i) issued, assumed or
guaranteed by foreign governments, or political subdivisions
or instrumentalities thereof, (ii) assumed or guaranteed by
domestic issuers, including Eurodollar securities, or (iii)
issued, assumed or guaranteed by foreign issuers having a
class of securities listed for trading on the New York Stock
Exchange or on a major Canadian exchange. See "Foreign
Securities", below. This investment limitation will not apply
to the International Equity, MidCap, Bond, Small-Cap Value,
Corporate Bond, Short-Term Maturity Bond, Small-Cap Aggressive
Growth, Foreign Equity, Maxim INVESCO Small-Cap Growth and
Maxim INVESCO ADR Portfolios.
Following are investment limitations applicable to the Maxim T.
Rowe Price Equity/Income and Maxim MidCap Growth Portfolios.
These are fundamental policies and may not be changed without
the approval of the holders of a majority of the outstanding
voting shares of the 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.
The Portfolios will not:
1.(a) Invest more than 15% of its total assets (taken at market
value at the time of each investment) in obligations
(excluding repurchase agreements) of any one bank, or, with
respect to 75% of its assets, invest more than 5% of such
assets in the securities (other than United States Government
or government agency securities) of any one issuer other than
a bank (but including repurchase agreements with any one
bank); and (b) purchase more than either (i) 10% in principal
amount of the outstanding debt securities of an issuer, or
(ii) 10% of the outstanding voting securities of an issuer,
except that such restrictions shall not apply to securities
issued or guaranteed by the United States Government or its
agencies, bank money instruments or bank repurchase
agreements. Under the diversification requirements of the
Investment Company Act of 1940 applicable to diversified
investment companies, such as the Fund, the Fund may not
invest more than 5% of the value of its total assets in the
securities of any one issuer (except that this statutory
restriction does not apply with respect to 25% of the value of
an investment company's total assets). Under the Fund's
current interpretation of the statutory diversification tests,
bank obligations of the type in which the Fund invests are not
subject to this 5% limitation and thus the Fund's only
<PAGE> 228
<PAGE>
limitation in this regard is the 15% limitation set forth
above. The staff of the Securities and Exchange Commission,
however, has taken the position that certain bank obligations
are subject to the statutory 5% limitation, and further action
by the Commission may make it necessary that the Fund revise
its investments in bank obligations so as not to exceed the 5%
limitation in order for the Fund to maintain its status as a
diversified company. This investment restriction does not
apply to the Investment Grade Corporate Bond, U.S. Government
Mortgage Securities or Short-Term Maturity Bond Portfolios.
2. 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.
3.Purchase or sell interests in commodities, commodities
contracts, oil, gas or other mineral exploration or
development programs, or real estate, except that the
Portfolio may purchase securities of issuers which invest or
deal in any of the above; provided, however, that the
Portfolio may invest in futures contracts, forward currency
contracts, and options on futures.
4.Make loans, except as provided in limitation (5) 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).
5.Lend its portfolio securities in excess of 33 1/3% 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.
6.Borrow, except that the Portfolios may (i) borrow for non-
leveraging, temporary or emergency purposes and (ii) engage in
reverse repurchase agreements and make other investments or
engage in other transactions which may involve a borrowing, in
a manner consistent with the Portfolio's investment objective
and program, provided that the combination of (i) and (ii)
shall not exceed 33 1/3% of the value of the Portfolio's total
assets (including the borrowed amount) less liabilities (other
than borrowings) or such other percentage permitted by law.
Any borrowings which come to exceed this amount will be
reduced in accordance with applicable law. Reverse repurchase
<PAGE> 229
<PAGE>
agreements and other investments which are "covered" by a
segregated account or an offsetting position in accordance
with applicable SEC requirements do not constitute borrowings
for purposes of any asset coverage requirement.
7.Underwrite securities of other issuers except insofar as the
Portfolio may be deemed an underwriter under the Securities
Act of 1933 in selling portfolio securities.
8.Purchase or sell real estate including limited partnership
interests therein, unless acquired as a result of ownership of
securities or other instruments (but this shall not prevent
the Portfolio from investing in securities or other
instruments backed by real estate or in securities of
companies engaged in the real estate business).
9.Issue senior securities except in compliance with the
Investment Company Act of 1940.
Notes
The following notes should be read in connection with the
above-described investment limitations. The notes are not
fundamental policies.
With respect to investment limitation (3), the Portfolios do
not consider currency contracts or hybrid investments to be
commodities.
For purposes of investment limitation (2), U.S., state or
local governments, or related agencies or instrumentalities,
are not considered an industry. Industries are determined by
reference to the classifications of industries set forth in
the Portfolio's semi-annual and annual reports.
For purposes of investment limitations (4) and (5), the
Portfolios will consider the acquisition of a debt security to
include the execution of a note or other evidence of an
extension of credit with a term of more than nine months.
Operating Policies
As a matter of operating policy, the Portfolios may not:
Purchase additional securities when money borrowed exceeds 5%
of its total assets.
Invest in companies for the purpose of exercising management
or control.
Purchase a futures contract or an option thereon if, with
respect to positions in futures or options on futures which do
<PAGE> 230
<PAGE>
not represent bona fide hedging, the aggregate initial margin
and premiums on such options would exceed 5% of the
Portfolio's net asset value.
Purchase securities of open-end or closed-end investment
companies except in compliance with the Investment Company Act
of 1940 and applicable state law. Duplicate fees may result
from such purchases.
Purchase securities on margin, except (i) to obtain short-term
credit necessary for clearance of purchases of portfolio
securities and (ii) to make margin deposits in connection with
futures contracts or other permissible investments.
Mortgage, pledge, hypothecate or, in any manner, transfer any
security owned by the Portfolios as security for indebtedness
except as may be necessary in connection with permissible
borrowings or investments and then such mortgaging, pledging
or hypothecating may not exceed 33 1/3% of the Portfolio's
total assets at the time of borrowing or investment.
Purchase participation or other direct interests in or enter
into leases with respect to, oil, gas, or other mineral
exploration or development programs.
Effect short sales of securities, unless a Portfolio owns or
has the right to obtain securities equivalent in kind and
amount to the securities sold short without the payment of any
additional consideration therefor, and provided that
transactions in options, swaps and forward futures contracts
are not deemed to constitute selling securities short.
Purchase a security (other than obligations issued or
guaranteed by the U.S., any foreign, state or local
government, their agencies or instrumentalities) if, as a
result, more than 5% of the value of the Portfolio's total
assets would be invested in the securities of issuers which at
the time of purchase had been in operation for less than three
years (for this purpose, the period of operation of any issuer
shall include the period of operation of any predecessor or
unconditional guarantor of such issuer). This restriction
does not apply to securities of pooled investment vehicles or
mortgage or asset-backed securities.
Invest in warrants if, as a result thereof, more than 2% of
the value of the net assets of the Portfolio would be invested
in warrants which are not listed on the New York Stock
Exchange, the American Stock Exchange, or a recognized foreign
exchange, or more than 5% of the value of the net assets of
the Portfolio would be invested in warrants whether or not so
listed. For purposes of these percentage limitations, the
warrants will be valued at the lower of cost or market and
<PAGE> 231
<PAGE>
warrants acquired by the Portfolio in units or attached to
securities may be deemed to be without value.
Following are investment limitations applicable to the Maxim
Blue Chip Portfolio. The policies designated as fundamental
policies may not be changed without the approval of the
holders of a majority of the outstanding voting shares of the
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. The policies designated as non-
fundamental may be changed by the Fund's Board of Directors
without shareholder approval.
Fundamental Policies
The Portfolio will not:
1.Make loans to other persons; the purchase of a portion of an
issue of publicly or privately distributed bonds, debentures
or other securities is not considered the making of a loan by
the Portfolio. The Portfolio may also enter into repurchase
agreements.
2.Underwrite the securities of other issuers except insofar as
the Portfolio may be deemed an underwriter under the
Securities Act of 1933 in selling portfolio securities.
3.Invest directly in physical commodities (other than foreign
currencies), real estate or interests in real estate; provided
that the Portfolio may invest in securities of issuers that
invest in physical commodities, real estate or interests in
real estate; and, provided further, that this shall not
prevent the Portfolio from purchasing or selling options,
futures, swaps and forward contracts or from investing in
securities or other instruments backed by physical
commodities, real estate or interests in real estate.
4.Make any investment if, as a result, 25% or more of the
Portfolio's total assets would be invested in securities of
issuers having their principal business activities in the same
industry, provided that this limitation does not apply to
obligations issued or guaranteed by the U.S. government, its
agencies or instrumentalities.
5.Issue any senior securities except in compliance with the
Investment Company Act of 1940.
<PAGE> 232
<PAGE>
8.Borrow money, except for extraordinary or emergency purposes,
and then only from banks in amounts up to 33 1/3% of the
Portfolio's total assets.
Non-Fundamental Policies
Purchase any securities on margin except to obtain such short-
term credits as may be necessary for the clearance of
transactions.
Sell securities short, unless the Portfolio owns or has the
right to obtain securities equivalent in kind and amount to
the securities sold short without the payment of any
additional consideration therefor, and provided that
transactions in options, swaps and forward futures contracts
are not deemed to constitute selling securities short.
Purchase more than 10% of any class of securities of any
single issuer or purchase more than 10% of the voting
securities of any single issuer.
Purchase securities of any issuer (other than obligations of,
or guaranteed by, the United States government, its agencies
or instrumentalities) if, as a result, more than 5% of the
value of the Portfolio's total assets would be invested in
securities of that issuer.
Invest more than 15% of the market value of its net assets in
securities which are not readily marketable, including
repurchase agreements maturing in over seven days.
Following are investment limitations applicable to the Maxim
INVESCO Balanced Portfolio. These are fundamental policies
and may not be changed without the approval of the holders of
a majority of the outstanding voting shares of the 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.
The Portfolio will not:
<PAGE> 233
<PAGE>
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.
2.With respect to 75% of its total assets, purchase the
securities of any one issuer (except cash items and
"Government securities" as defined under the 1940 Act), if the
purchase would cause the Portfolio to have more than 5% of the
value of its total assets invested in the securities of such
issuer or to own more than 10% of the outstanding voting
securities of such issuer.
3.Purchase or sell physical commodities other than foreign
currencies unless acquired as a result of ownership of
securities (but this shall not prevent the Portfolio from
purchasing or selling options, futures, swap and forward
contracts or from investing in securities or other instruments
backed by physical commodities).
4.Make loans, except as provided in limitation (5) 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).
5.Lend its portfolio securities in excess of 33 1/3% of the
total assets of the Portfolio (including the amount borrowed),
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", in this
Statement of Additional Information.
6.Borrow money, except that the Portfolio may borrow money as a
temporary measure for extraordinary or emergency purposes (not
for leveraging or investment) and may enter into reverse
repurchase agreements in an aggregate amount not exceeding 33
1/3% of the value of its total assets (including the amount
borrowed) less liabilities (other than borrowings). Any
borrowing that comes to exceed 33 1/3% of the value of the
Portfolio's total assets due to a decline in net assets will
be reduced within three days to the extent necessary to comply
with the 33 1/3% limitation. This restriction shall not
prohibit deposits of assets to margin or guarantee positions
in futures, options, swaps or forward contracts, or the
segregation of assets in connection with such contracts.
<PAGE> 234
<PAGE>
7.Underwrite securities of other issuers except insofar as the
Portfolio may be deemed an underwriter under the Securities
Act of 1933 in selling portfolio securities.
8.Invest directly in real estate or interest in real estate;
however, the Portfolio may own debt or equity securities
issued by companies engaged in those businesses.
9.Issue senior securities. For purposes of this restriction,
the issuance of shares of common stock in multiple classes or
series, obtaining of short-term credits as may be necessary
for the clearance of purchases and sales of portfolio
securities, short sales against the box, the purchase or sale
or permissible options and futures transactions (and the use
of initial and maintenance margin arrangements with respect to
futures contracts or related options transactions), the
purchase or sale of securities on a when issued or delayed
delivery basis, permissible borrowings entered into in
accordance with the Portfolio's investment policies, and
reverse repurchase agreements are not deemed to be issuances
of senior securities.
As a fundamental policy in addition to the above, the
Portfolio may, notwithstanding any other investment policy or
limitation (whether or not fundamental), invest all of its
assets in the securities of a single open-end management
investment company with substantially the same fundamental
investment objectives, policies and limitations as the
Portfolio.
Further, the following additional investment restrictions,
which are operating policies of the Portfolio are applicable.
These policies may be changed by the Board of Directors
without shareholder approval.
(a)Investments in warrants, valued at the lower of cost or
market, may not exceed 5% of the value of the Portfolio's net
assets. Included within that amount, but not to exceed 2% of
the value of the Portfolio's net assets, may be warrants that
are not listed on the New York or American Stock Exchanges.
Warrants acquired by the Portfolio in units or attached to
securities shall be deemed to be without value.
(b)The Portfolio will not (i) enter into futures contracts or
options on futures contracts if immediately thereafter the
aggregate margin deposits on all outstanding futures contracts
positions held by the Portfolio and premiums paid on
outstanding options on futures contracts, after taking into
consideration unrealized profits and losses, would exceed 5%
of the market value of the total assets of the Portfolio, or
(ii) enter into any futures contracts if the aggregate net
amount of the Portfolio's commitments under outstanding
<PAGE> 235
<PAGE>
futures contracts positions of the Portfolio would exceed the
market value of the total assets of the Portfolio.
(c)The Portfolio does not currently intend to sell securities
short, unless it owns or has the right to obtain securities
equivalent in kind and amount to the securities sold short
without the payment of any additional consideration therefor,
and provided that transactions in options, swaps and forward
futures contracts are not deemed to constitute selling
securities short.
(d)The Portfolio does not currently intend to purchase securities
on margin, except that the Portfolio may obtain such short-
term credits as are necessary for the clearance of
transactions, and provided that margin payments and other
deposits in connection with transactions in options, futures,
swaps and forward contracts shall not be deemed to constitute
purchasing securities on margin.
(e)The Portfolio does not currently intend to (i) purchase
securities of closed end investment companies, except in the
open market where no commission except the ordinary broker's
commission is paid, or (ii) purchase or retain securities
issued by other open-end management investment companies.
Limitations (i) and (ii) do not apply to money market funds or
to securities received as dividends, through offers of
exchange, or as a result of a reorganization, consolidation,
or merger. If the Portfolio invests in a money market fund,
the investment advisory fee will be waived on the assets of
the Portfolio which are invested in the money market fund
during the time that those assets are so invested.
(f)The Portfolio may not mortgage or pledge any securities owned
or held by the Portfolio in amounts that exceed, in the
aggregate, 15% of the Portfolio's net asset value, provided
that this limitation does not apply to reverse repurchase
agreements or in the case of assets deposited to margin or
guarantee positions in futures, options, swaps or forward
contracts or placed in a segregated account in connection with
such contracts.
(g)The Portfolio does not currently intend to purchase securities
of any issuer (other the U.S. Government agencies and
instrumentalities or instruments guaranteed by an entity with
a record of more than three years' continuous operation,
including that of predecessors) with a record of less than
three years' continuous operation (including that of
predecessors) if such purchase would cause the Portfolio's
investments in all such issuers to exceed 5% of the
Portfolio's total assets taken at market value at the time of
such purchase.
<PAGE> 236
<PAGE>
(h)The Portfolio does not currently intend to invest directly in
oil, gas, or other mineral development or exploration programs
or leases; however, the Portfolio may own debt or equity
securities of companies engaged in those businesses.
(i)The Portfolio may not invest in companies for the purpose of
exercising control or management, except to the extent that
exercise by the Portfolio of its rights under agreements
related to portfolio securities would be deemed to constitute
such control.
Foreign Securities
Any Portfolio of the Fund may purchase certain foreign
securities. Investments in foreign securities, particularly
those of non-governmental issuers, involve considerations
which are not ordinarily associated with investing in domestic
issuers. The following describes certain of these
considerations in addition to those set forth in the
Prospectus. Delays may be encountered in settling securities
transactions in certain foreign markets. Also, it is possible
that market quotations for foreign securities will not be
readily available. In such event, these securities shall be
valued at fair value as determined in good faith by the Board
of Directors. If it should become necessary, the Fund could
encounter greater difficulties in invoking legal processes
abroad than would be the case in the United States.
Transaction costs in foreign securities may be higher. The
Investment Adviser will consider these and other factors
before investing in foreign securities, and will not make such
investments unless, in its opinion, such investments will meet
the standards and objectives of the Fund. In particular,
management anticipates that these considerations will be
inapplicable to a variety of Canadian investments. The
Portfolios will not concentrate its investments in any
particular foreign country, and will purchase only securities
issued in dollar denominations. Notwithstanding the
foregoing, the following Portfolios may invest in non-dollar
denominated foreign equity securities: International Equity,
Mid-Cap, Small-Cap Value, Bond, Corporate Bond, Small-Cap
Aggressive Growth, Foreign Equity, Maxim T. Rowe Price
Equity/Income, Maxim MidCap Growth, Maxim Blue Chip, Maxim
INVESCO Balanced, Maxim INVESCO Small-Cap Growth and Maxim
INVESCO ADR Portfolios.
Lending of Portfolio Securities
<PAGE> 237
<PAGE>
Subject to Investment Limitations described above for all
Portfolios, each Portfolio of the Fund from time-to-time may
lend securities from its portfolio to brokers, dealers and
financial institutions and receive as collateral cash or U.S.
Treasury securities which, at all times while the loan is
outstanding, will be maintained in amounts equal to at least
100% of the current market value of the loaned securities.
Any cash collateral will be invested in short-term securities,
which will increase the current income of the Fund. Such
loans, which will not have terms longer than 30 days, will be
terminable at any time. The Fund will have the right to
regain record ownership of loaned securities to exercise
beneficial rights such as voting rights, subscription rights
and rights to dividends, interest or other distributions. The
Fund may pay reasonable fees to persons unaffiliated with the
Fund for services in arranging such loans.
MANAGEMENT OF 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 President Emeritus, Denver
Director2/ Metro Chamber of Commerce
(since 1987)
Richard P. Koeppe, Ph.D. Retired Superintendent,
Director3/ Denver Public Schools
(1988-1990)
Douglas L. Wooden Great-West Life & Annuity
Director1/ 5/ Insurance Company,
Senior Vice President, Financial
Services (since 1996); Senior
Vice-President, Chief Financial
Officer (1991-1996)
James D. Motz Great-West Life & Annuity
Director1/ 5/ Insurance Company,
Senior Vice-President, Employee
Benefits (since 1991); Vice-
President, Group (1983-1990)
Sanford Zisman Attorney, Zisman &
Director4/ Ingraham, P.C.
<PAGE> 238
<PAGE>
Glen R. Derback Great-West Life &
Treasurer, Principal Annuity Insurance Company,
Financial and Accounting Vice President, Financial
Officer1/ 5/ Control (since 1984)
Beverly A. Byrne Great-West Life & Annuity
Secretary1/ 5/ Insurance Company, Assistant
Counsel (since 1993); Attorney
(1988-1993)
_________________________________
1/ Interested person as defined in the Investment
Company Act of 1940 and affiliated person of
Investment Adviser.
2/ 6508 Hollytree Circle, Tyler, Texas 75703
3/ 8679 East Kenyon Avenue, Denver, Colorado 80237
4/ 3773 Cherry Creek North Drive, Suite 250, Denver,
Colorado 80209.
5/ Great-West Life & Annuity Insurance Company, 8515 E.
Orchard Road, Englewood, Colorado 80111.
<PAGE> 239
<PAGE>
Compensation
The Fund pays no salaries or compensation to any of its
officers or Directors affiliated with the Investment Adviser
or its affiliates. The chart below sets for the annual fees
paid to non-interested Directors in 1996.
<TABLE>
<CAPTION>
R.P. Koeppe R. Jennings S. Zisman
<S> <C> <C> <C>
Compensation received
from the Fund $8,450 $8,450 $8,450
Pension or retirement
benefits accrued as
a Fund expense $0 $0 $0
Total compensation
received from the
Fund and all affi-
liated funds** $12,450 $12,450 $12,450
</TABLE>
------------------------
** As of December 31, 1996, there were twenty-nine funds for
which the Directors serve as Directors or Trustees of which
twenty-three are Portfolios of the Fund. The total
compensation paid is comprised of the amount paid during 1996
by the Fund and all affiliated investment companies.
The Investment Adviser
The information that follows supplements the information
provided about the Investment Adviser under the caption
"Management of the Fund - Investment Adviser" in the
Prospectus.
G W Capital Management, Inc. (the "Investment Adviser") serves
as the investment adviser to the Fund pursuant to an
Investment Advisory Agreement with the Fund. The Investment
Adviser is a wholly owned subsidiary of Great-West Life &
Annuity Insurance Company ("GWL&A"). GWL&A is in turn a
wholly owned subsidiary of The Great-West Life Assurance
Company ("Great-West") which is a 99.5% 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
<PAGE> 240
<PAGE>
subsidiary of Marquette Communications Corporation which in
turn is a wholly owned subsidiary of Power Corporation of
Canada. Mr. Paul Desmarais, through a group of private
holding companies, which he controls, has voting control of
Power Corporation of Canada.
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 10, 1997. As
approved, the Agreement will remain in effect until April 1,
1998 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.
Advisory Fee.
The method of computing the investment advisory fee is fully
described in the Prospectus.
The Sub-Advisers
Janus Capital Corporation
Janus Capital Corporation serves as the sub-adviser to the
MidCap Portfolio pursuant to a Sub-Advisory Agreement dated
December 1, 1993. Janus Capital Corporation has served as
investment adviser to Janus Investment Fund since 1969 and
<PAGE> 241
<PAGE>
also serves as adviser and sub-adviser to other mutual funds,
and individual, corporate, charitable and retirement accounts.
Kansas City Southern Industries, Inc. ("KCSI") owns
approximately 83% of the outstanding voting stock of Janus
Capital. KCSI is a publicly traded holding company whose
primary subsidiaries are engaged in transportation, financial
services and real estate.
Templeton Investment Counsel, Inc.
Templeton Investment Counsel, Inc. ("TICI") serves as the sub-
adviser to the International Equity Portfolio pursuant to a
Sub-Advisory Agreement dated December 1, 1993. TICI is an
indirect subsidiary of Templeton Worldwide, Inc., which in
turn is a direct, wholly-owned subsidiary of Franklin
Resources, Inc.
Ariel Capital Management, Inc.
Ariel Capital Management, Inc. ("Ariel") serves as the sub-
adviser to the Small-Cap Value Portfolio pursuant to a Sub-
Advisory Agreement dated December 1, 1993. Ariel is a
privately held minority-owned money manager.
The Sub-Advisers provides investment advisory assistance and
portfolio management advice to the Investment Adviser for the
respective Portfolios. Subject to review and supervision by
the Investment Adviser and the Board of Directors of the Fund,
the sub-advisers are responsible for the actual management of
the respective Portfolios and for making decisions to buy,
sell or hold any particular securities. The Sub-Advisers bear
all expenses in connection with the performance of their
services, such as compensating and furnishing office space for
their officers and employees connected with investment and
economic research, trading and investment management for the
Portfolios.
T. Rowe Price Associates, Inc.
T. Rowe Price Associates, Inc. serves as the sub-adviser to
the Maxim T. Rowe Price Equity/Income and Maxim MidCap Growth
Portfolios pursuant to a Sub-Advisory Agreement dated November
1, 1994 as amended. T. Rowe Price serves as investment
manager to a variety of individual and institutional
investors, including limited and real estate partnerships and
other mutual funds.
INVESCO Trust Company
INVESCO Trust Company serves as the sub-adviser to the Maxim
INVESCO Small-Cap Growth, Maxim INVESCO ADR and Maxim INVESCO
Balanced Portfolios pursuant to Sub-Advisory Agreements dated
<PAGE> 242
<PAGE>
November 1, 1994 and August 30, 1996. INVESCO Trust Company
is an indirect wholly-owned subsidiary of AMVESCO PLC.
AMVESCO PLC is a publicly-traded holding company that, through
its subsidiaries, engages in the business of investment
management on an international basis. INVESCO PLC changed its
name to AMVESCO PLC on March 3, 1997, as part of a merger
between a direct subsidiary of INVESCO PLC and A I M
Management Group Inc., thus creating one of the largest
independent investment management businesses in the world.
Subject to obtaining shareholder approve at its regular Annual
Shareholder Meeting, the board of directors of AMVESCO PLC has
concluded that the corporate name should be changed to
AMVESCAP PLC effective May 8, 1997. ITC will continue to
operate under its existing name. AMVESCO has approximately
$165 billion in assets under management.
Loomis, Sayles, & Company L.P.
Loomis, Sayles & Company L.P. serves as the sub-adviser to the
Corporate Bond, Small-Cap Aggressive Growth and Foreign Equity
Portfolios pursuant to a Sub-Advisory Agreement dated August
30, 1996, as amended. Loomis Sayles serves as investment
manager to a variety of individual investors, including other
mutual funds. Loomis Sayles is an indirect, majority-owned
subsidiary of Metropolitan Life Insurance Company.
Founders Asset Management, Inc.
Founders Asset Management, Inc. serves as the sub-adviser to
the Maxim Blue Chip Portfolio pursuant to a Sub-Advisory
Agreement dated May 1, 1997. Founders serves as investment
manager to a variety of individual and institutional
investors, including other mutual funds.
Sub-Advisory Fees
The method of computing the sub-advisory fees are fully
described in the Prospectus.
For the past three fiscal years, the Investment Adviser was
paid a fee for its services to the Fund as follows:
<TABLE>
<CAPTION>
Portfolio 1996 1995 1994
<S> <C> <C> <C>
Money Market $1,566,842 $1,094,639 $ 672,768
<PAGE> 243
<PAGE>
Portfolio 1996 1995 1994
Bond $ 470,658 $ 450,783 $ 456,146
Stock Index1/ $4,887,975 $3,630,287 $3,273,683
U.S. Government $ 360,629 $ 377,523 $ 345,124
Securities2/
Zero-Coupon N/A $ 4,195 $ 4,959
Treasury3/
Total Return4/ $ 364,049 $ 293,890 $ 236,951
Investment Grade $ 575,853 $ 511,001 $ 396,105
Corporate
Bond5/
U.S. Government
Mortgage $ 791,813 $ 679,091 $ 507,835
Securities6/
Small-Cap Index7/ $ 404,890 $ 218,365 $ 82,060
Growth Index7/ $ 371,758 $ 172,719 $ 49,266
Value Index7/ $ 552,296 $ 264,392 $ 92,658
International $ 756,318 $ 459,104 $ 119,822
Equity7/
Small-Cap Value7/ $ 274,316 $ 148,789 $ 62,566
MidCap8/ $1,794,155 $1,049,333 $ 155,648
Corporate Bond9/ $ 574,728 $ 250,744 $ 22,771
Small-Cap Aggressive$ 469,293 $ 202,999 $ 19,599
Growth9/
Foreign Equity9/ $ 711,998 $ 581,443 $ 66,960
Maxim T. Rowe Price
Equity/Income9/ $ 257,708 $ 44,411 $ 2,664
Maxim INVESCO Small-
Cap Growth9/ $ 178,001 $ 34,500 $ 3,085
Maxim INVESCO ADR9/$ 45,589 $ 22,375 $ 3,255
Short-Term Maturity$ 179,920 $ 22,401 N/A
Bond10/
<PAGE> 244
<PAGE>
Portfolio 1996 1995 1994
Maxim INVESCO $ 26,984 N/A N/A
Balanced11/
</TABLE>
1/ For the period commencing September 24, 1984. The name
and investment objective of this portfolio was changed
effective December 1, 1992.
2/Formed April 6, 1985. The name and the investment objective
of this portfolio was changed effective July 29, 1987, and
renamed and the investment objective changed effective May 1,
1990.
3/Formed October 1, 1985.
4/Formed July 29, 1987.
5/Formed December 1, 1992.
6/Formed December 1, 1992.
7/Formed December 1, 1993.
8/Formed January 3, 1994.
9/Formed November 1, 1994.
10/Formed August 1, 1995.
11/Formed October 1, 1996.
Payment of Expenses.
Prior to May 1, 1992, the Investment Adviser provided
investment advisory services and paid all compensation of and
furnished office space for officers and employees of the
Investment Adviser connected with investment and economic
research, trading and investment management of the Fund, as
well as the fees of all directors of the Fund who are
affiliated persons of GW Capital Management or any of its
affiliates. The Fund paid all other expenses incurred in its
operation and all of the Fund's general administrative
expenses.
<PAGE> 245
<PAGE>
Expenses that were borne directly by the Fund included
redemption expenses, expenses of portfolio transactions,
shareholder servicing costs, expenses of registering the
shares under federal and state securities laws, pricing costs
(including the daily calculation of net asset value),
interest, certain taxes, charges of the Custodian and Transfer
Agent, directors' fees, legal expenses, state franchise taxes,
costs of auditing services, costs of printing proxies and
stock certificates, Securities and Exchange Commission fees,
advisory fees, certain insurance premiums, costs of corporate
meetings, costs of maintenance of corporate existence,
investor services (including allocable telephone and personnel
expenses), extraordinary expenses, and other expenses properly
payable by the Fund. Accounting services were provided for
the Fund by the Investment Adviser and the Fund reimbursed the
Investment Adviser for its costs in connection with such
services. The amounts of such expense reimbursements for the
Fund's fiscal years ended December 31, 1996, 1995 and 1994
were $266,446, $ 236,850 and $111,944 respectively. Depending
upon the nature of the lawsuit, litigation costs may be borne
by the Fund.
The Investment Adviser has agreed that it will waive all or a
part of its management fee to the extent normal operating
expenses (excluding interest, taxes, brokerage fees,
commissions and extraordinary charges) of the Portfolios
listed below. With respect to these Portfolios, the Fund
shall pay all expenses incurred with operations, including
extraordinary expenses, however, the Investment Adviser shall
pay all expenses which exceed an annual rate of 0.95% of the
average daily net assets of the Maxim T. Rowe Price
Equity/Income Portfolio; 1.10% of the average daily net assets
of the MidCap and Maxim INVESCO Small-Cap Growth Portfolios;
1.30% of the average daily net assets of the Small-Cap
Aggressive Growth and Maxim INVESCO ADR Portfolios; 1.35% of
the average daily net assets of the Small-Cap Value Portfolio;
and 1.50% of the average daily net assets of the International
Equity and Foreign Equity Portfolios.
Expenses paid by the Investment Adviser for 1995 and 1996 were:
<TABLE>
<CAPTION>
Portfolio 1995 1996
<S> <C> <C>
Foreign Equity $ 1,759 $ 32,547
International Equity $ 8,822 $ 16,011
Maxim INVESCO ADR $ 28,646 $ 43,582
Maxim INVESCO
Small-Cap Growth $ 43,637 $ 68,725
<PAGE> 246
<PAGE>
MidCap $ 47,589 $ 16,270
Small-Cap Aggressive
Growth $ 31,883 $ 81,373
Small-Cap Value $ 25,798 $ 4,231
Maxim T. Rowe Equity/
Income $ 48,716 $ 3,707
</TABLE>
PORTFOLIO TRANSACTIONS AND BROKERAGE
Portfolio Turnover
Brokerage costs to each Portfolio of the Fund are commensurate
with the rate of portfolio activity. In computing the
portfolio turnover rate for each portfolio, certain U.S.
Government securities (long-term for periods before 1986 and
short-term for all periods) and all other securities, the
maturities or expiration dates of which at the time of
acquisition are one year or less, are excluded. Subject to
this exclusion, the turnover rate for a portfolio is
calculated by dividing (a) the lesser of purchases or sales of
portfolio securities for the fiscal year by (b) the monthly
average value of portfolio securities owned by the portfolio
during the fiscal year.
There will be no fixed limitations regarding the portfolio
turnover of Portfolios of the Fund. Portfolio turnover rates
are expected to fluctuate under constantly changing economic
conditions and market circumstances. Securities initially
satisfying the basic policies and objectives of each Portfolio
may be disposed of when they are no longer deemed suitable.
Based upon the formulation for calculating the portfolio
turnover rate, as stated above, for each Portfolio (other than
the Money Market Portfolio) is as follows:
<PAGE> 247
<PAGE>
<TABLE>
<CAPTION>
1995 1996
Portfolio Turnover Rate Turnover Rate
<S> <C> <C>
Bond 191.58% 117.39%
Stock Index 5.25% 3.31%
U.S. Government
Securities 185.57% 145.02%
Total Return 44.70% 74.52%
Corporate Bond 24.70% 40.02%
Small-Cap Index 30.17% 39.66%
Small-Cap Value 17.78% 30.61%
International Equity 20.28% 22.21%
Maxim INVESCO ADR 5.88% 15.25%
Maxim INVESCO Balanced N/A 17.14%*
Maxim INVESCO Small-Cap
Growth 266.64% 265.05%
MidCap 167.21% 80.31%
Maxim T. Rowe Price
Equity/Income 14.00% 26.15%
Foreign Equity 119.98% 75.65%
Growth Index 17.90% 41.55%
Investment Grade
Corporate Bond 159.21% 118.50%
Short-Term Maturity
Bond 97.87% 51.71%
Small-Cap Aggressive
Growth 99.48% 62.63%
U.S. Government
Mortgage Securities 188.04% 94.63%
Value Index 18.11% 16.31%
</TABLE>
* Annualized
A higher portfolio turnover rate may involve correspondingly
greater brokerage commissions and other expenses which might
be borne by the Fund and, thus, indirectly by its
shareholders.
Placement of Portfolio Brokerage
The Fund does not have any obligation to deal with any broker,
dealer or group of brokers or dealers in the execution of
transactions in portfolio securities. Subject to policy
established by the Board of Directors, the Investment Adviser
<PAGE> 248
<PAGE>
is primarily responsible for placement of the Fund's portfolio
transactions. In placing orders, it is the policy of the Fund
to obtain the most favorable net results, taking into account
various factors, including price, dealer spread or
commissions, if any, size of the transaction and difficulty of
execution. While the Investment Adviser generally will seek
reasonably competitive spreads or commissions, the Fund will
not necessarily be paying the lowest spread or commission
available.
In placing portfolio transactions, the Investment Adviser may
give consideration to brokers who provide supplemental
investment research, in addition to such research obtained for
a flat fee, to the Investment Adviser, and pay commissions to
such brokers or dealers furnishing such services which are in
excess of commissions which another broker or dealer may
charge for the same transaction. Such supplemental research
ordinarily consists of assessments and analyses of the
business or prospects of a company, industry, or economic
sector. Supplemental research obtained through brokers or
dealers will be in addition to and not in lieu of the services
required to be performed by the Investment Adviser. The
expenses of the Investment Adviser will not necessarily be
reduced as a result of the receipt of such supplemental
information. The Investment Adviser may use any supplemental
investment research obtained for the benefit of the Fund in
providing investment advice to its other investment advisory
accounts, and may use such information in managing their own
accounts. Conversely, such supplemental information obtained
by the placement of business for the Investment Adviser will
be considered by and may be useful to the Investment Adviser
in carrying out its obligations to the Fund. For the year
ended December 31, 1996 the Fund paid out $1,692,326 in
commissions on transactions that aggregated $850,725,101 to
brokers who supplied such supplemental research.
Purchases and sales of securities for the Money Market
Portfolio usually are principal transactions, and normally,
for all portfolios, the Fund will deal directly with the
underwriters or dealers who make a market in the securities
involved unless better prices and execution are available
elsewhere. Such dealers usually act as principals for their
own account. On occasion, securities may be purchased
directly from the issuer. Bonds and money market securities
are generally traded on a net basis and do not normally
involve either brokerage commissions or transfer taxes. The
cost of portfolio securities transactions of the Fund that are
not transactions with principals will consist primarily of
brokerage commissions or dealer or underwriter spreads between
the bid and asked price, although purchases from underwriters
of portfolio securities include a commission or concession
paid by the issuer.
<PAGE> 249
<PAGE>
Securities held by the Fund may also be held by other separate
accounts or mutual funds for which the Investment Adviser
serves as an adviser, or held by GWL&A, the Investment Adviser
for one or more clients when one or more clients are selling
the same security. If purchases or sales of securities for
the Fund or other entities for which they act as investment
adviser or for their advisory clients arise for consideration
at or about the same time, transactions in such securities
will be made for the respective entities and clients in a
manner deemed equitable to all. To the extent that
transactions on behalf of more than one client of the
Investment Adviser during the same period may increase the
demand for securities being purchased or the supply of
securities being sold, there may be an adverse effect on
price.
On occasions when the Investment Adviser deems the purchase or
sale of a security to be in the best interests of the Fund as
well as other accounts or companies, it may to the extent
permitted by applicable laws and regulations, but will not be
obligated to, aggregate the securities to be sold or purchased
for the Fund with those to be sold or purchased for such other
accounts or companies in order to obtain favorable execution
and lower brokerage commissions. In that event, allocation of
the securities purchased or sold, as well as the expenses
incurred in the transaction, will be made by the Investment
Adviser in the manner it considers to be most equitable and
consistent with its fiduciary obligations to the Fund and to
such other accounts or companies. In some cases this
procedure may adversely affect the size of the position
obtainable for a Portfolio.
No brokerage commissions have been paid by the Money Market,
Bond, Investment Grade Corporate Bond, U.S. Government
Securities, U.S. Government Mortgage Securities, the Zero-
Coupon Treasury or the Short-Term Maturity Bond Portfolios for
the years ended December 31, 1994 through December 31, 1996.
The Stock Index Portfolio (prior to December 1, 1992, the
Growth Portfolio) paid commissions in the amount of $179,151,
$80,467 and $89,897 for the years ended December 31, 1994,
1995 and 1996. The Total Return Portfolio paid commissions in
the amount of $105,117, $51,369 and $61,228 for the years
ended December 31, 1994, 1995 and 1996, respectively. The
International Equity portfolio paid commissions in the amount
of $126,521, $126,601 and $190,398 in 1994, 1995 and 1996,
respectively. The Small-Cap Index Portfolio paid commissions
in the amount of $86,863, $63,611 and $154,696 in 1994, 1995
and 1996, respectively. The Value Index Portfolio paid
commissions in the amount of $43,591, $38,183 and $53,019 in
1994, 1995 and 1996, respectively. The Growth Index Portfolio
paid commissions in the amount of $20,103, $25,946 and $48,480
<PAGE> 250
<PAGE>
in 1994, 1995 and 1996, respectively. The Small-Cap Value
Portfolio paid commissions in the amount of $18,944, $29,175
and $55,133 in 1994, 1995 and 1996, respectively. The MidCap
Portfolio paid commissions in the amount of $211,600, $468,104
and $471,788 in 1994, 1995 and 1996, respectively. The
Small-Cap Aggressive Growth Portfolio paid commissions in the
amount of $5,150, $60,792 and $131,463 in 1994, 1995 and 1996,
respectively. The Foreign Equity Portfolio paid commissions
in the amount of $35,586, $456,623 and $322,774 in 1994, 1995
and 1996, respectively. The Maxim T. Rowe Price Equity/Income
Portfolio paid commissions in the amount of $3,188, $7,074 and
$50,812 in 1994, 1995 and 1996, respectively. The Maxim
INVESCO Small-Cap Growth Portfolio paid commissions in the
amount of $1,755, $11,195 and $40,317 in 1994, 1995 and 1996,
respectively. The Maxim INVESCO ADR Portfolio paid
commissions in the amount of $1,902, $932 and $2,664 in 1994,
1995 and 1996, respectively. The Corporate Bond Portfolio
paid commissions in the amount of $1,064 in 1995 and $1,120 in
1996. The Maxim INVESCO Balanced Portfolio paid commissions
in the amount of $18,537 in 1996.
PURCHASE AND REDEMPTION OF SHARES
As of December 31, 1996, all of the outstanding shares of the
Fund were presently held of record by Maxim Series Account,
Pinnacle Series Account, Retirement Plan Series Account,
FutureFunds Series Account, FutureFunds Series Account II and
Qualified Series Account of GWL&A, by TNE Series (k) Account
of MetLife, and by Great-West, which provided the initial
capitalization for certain Portfolios.
The following tables show the allocations of shares of the
Fund among the Series Accounts as of December 31, 1996.
<TABLE>
<CAPTION>
Money Market Portfolio
Series Account No. of Shares Percentage
<S> <C> <C>
Maxim Series Account 2,490,288 0.63%
FutureFunds Series Account 55,297,862 13.96%
FutureFunds Series Account II 313,718,098 79.18%
Pinnacle Series Account 353,080 0.09%
<PAGE> 251
<PAGE>
Qualified Series Account 943,596 0.24%
TNE Series (k) Account 22,344,012 5.64%
Retirement Plan Series Account 1,038,148 0.26%
TOTAL 396,185,085 100.00%
Bond Portfolio
Series Account No. of Shares Percentage
Maxim Series Account 3,321,573 5.13%
FutureFunds Series Account 44,203,798 68.26%
FutureFunds Series Account II 16,666,145 25.73%
Pinnacle Series Account 490,722 0.76%
Qualified Series Account 77,457 0.12%
TOTAL 64,759,695 100.00%
International Equity Portfolio
Series Account No. of Shares Percentage
FutureFunds Series Account 27,207,607 37.43%
FutureFunds II Series Account 45,489,363 62.57%
TOTAL 72,696,970 100.00%
Stock Index Portfolio*
Series Account No. of Shares Percentage
Maxim Series Account 7,277,989 1.84%
FutureFunds Series Account 156,197,730 39.43%
FutureFunds Series Account II 220,890,516 55.76%
Pinnacle Series Account 620,634 0.16%
<PAGE> 252
<PAGE>
Qualified Series Account 2,360,763 0.60%
TNE Series (K) Account 7,293,796 1.84%
Retirement Plan Series Account
1,475,333 0.37%
TOTAL 396,116,761 100.00%
* Prior to December 1, 1992, the Growth Portfolio.
<PAGE> 253
<PAGE>
U.S. Government Securities Portfolio
Series Account No. of Shares Percentage
Maxim Series Account 10,086,010 16.90%
FutureFunds Series Account 37,698,695 63.18%
FutureFunds Series Account II 10,677,688 17.89%
Pinnacle Series Account 1,210,909 2.03%
TOTAL 59,673,302 100.00%
Total Return Portfolio
Series Account No. of Shares Percentage
Maxim Series Account 3,618,241 7.51%
FutureFunds Series Account II 38,304,639 79.45%
Pinnacle Series Account 297,114 0.62%
FutureFunds Series Account 3,703,913 7.68%
TNE Series (K) Account 1,704,243 3.53%
Retirement Plan Series Account 584,099 1.21%
TOTAL 48,212,249 100.00%
Investment Grade Corporate Bond Portfolio
Series Account No. of Shares Percentage
FutureFunds Series Account II 72,223,579 91.60%
Qualified Series Account 320,807 0.40%
TNE Series (K) Account 6,083,640 7.72%
Retirement Plan Series Account 222,334 0.28%
TOTAL 78,850,360 100.00%
<PAGE> 254
<PAGE>
U.S. Government Mortgage Securities Portfolio
Series Account No. of Shares Percentage
FutureFunds Series Account II 112,088,119 93.25%
TNE Series (K) Account 7,739,648 6.44%
Retirement Plan Series Account 377,092 0.31%
TOTAL 120,204,859 100.00%
Growth Index Portfolio
Series Account No. of Shares Percentage
FutureFunds II Series Account 48,358,184 85.77%
TNE Series (K) Account 6,478,660 11.49%
Retirement Plan Series Account 1,546,764 2.74%
TOTAL 56,383,608 100.00%
Value Index Portfolio
Series Account No. of Shares Percentage
FutureFunds II Series Account 72,781,363 86.53%
TNE Series (K) Account 10,119,440 12.03%
Retirement Plan Series Account 1,213,423 1.44%
TOTAL 84,114,226 100.00%
Small-Cap Index Portfolio
Series Account No. of Shares Percentage
Maxim Series Account 123,186 0.19%
FutureFunds Series Account 6,337,383 9.70%
FutureFunds II Series Account 51,612,241 79.03%
<PAGE> 255
<PAGE>
TNE Series (K) Account 5,616,063 8.60%
Retirement Plan Series Account 859,615 1.32%
Great-West 759,049 1.16%
TOTAL 65,307,537 100.00%
Small-Cap Value Portfolio
Series Account No. of Shares Percentage
Maxim Series Account 16,817 0.06%
FutureFunds Series Account 421,784 1.44%
FutureFunds II Series Account 22,953,992 78.27%
TNE Series (K) Account 3,406,204 11.61%
Retirement Plan Series Account 345,736 1.18%
Great-West 2,181,667 7.44%
TOTAL 29,326,200 100.00%
Corporate Bond Portfolio
Series Account No. of Shares Percentage
Maxim Series Account 141,121 0.20%
FutureFunds Series Account 5,716,139 7.94%
FutureFunds II Series Account 57,795,017 80.27%
TNE Series (K) Account 7,932,119 11.02%
Retirement Plan Series Account 412,893 0.57%
TOTAL 71,997,289 100.00%
Small-Cap Aggressive Growth Portfolio
Series Account No. of Shares Percentage
<PAGE> 256
<PAGE>
FutureFunds II Series Account 49,619,519 87.07%
TNE Series (K) Account 6,305,921 11.06%
Retirement Plan Series Account 1,065,024 1.87%
TOTAL 56,990,464 100.00%
Foreign Equity Growth Portfolio
Series Account No. of Shares Percentage
FutureFunds II Series Account 65,702,864 86.77%
TNE Series (K) Account 9,577,564 12.65%
Retirement Plan Series Account 438,024 0.58%
TOTAL 75,718,452 100.00%
Maxim INVESCO Small-Cap Growth Portfolio
Series Account No. of Shares Percentage
Maxim Series Account 389,143 1.76%
FutureFunds Series Account 10,042,050 45.21%
FutureFunds II Series Account 9,428,583 42.45%
Great-West 2,350,597 10.58%
TOTAL 22,210,373 100.00%
Maxim T.Rowe Price Equity/Income Portfolio
Series Account No. of Shares Percentage
Maxim Series Account 709,651 1.48%
FutureFunds Series Account 19,418,225 40.47%
FutureFunds II Series Account 27,206,792 56.70%
Great-West 649,188 1.35%
<PAGE> 257
<PAGE>
TOTAL 47,983,856 100.00%
MidCap Portfolio
Series Account No. of Shares Percentage
FutureFunds II Series Account 121,297,090 80.93%
Maxim Series Account 822,697 0.55%
FutureFunds Series Account 27,749,856 18.52%
TOTAL 149,869,643 100.00%
Maxim INVESCO ADR Portfolio
Series Account No. of Shares Percentage
Maxim Series Account 150,802 2.65%
FutureFunds Series Account 1,859,776 32.65%
FutureFunds II Series Account 1,638,003 28.75%
Great-West 2,047,782 35.95%
TOTAL 5,696,363 100.00%
Short-Term Maturity Bond Portfolio
Series Account No. of Shares Percentage
FutureFunds II Series Account 31,212,451 79.52%
TNE Series (K) Account 5,013,893 12.78%
Retirement Plan Series Account 32,114 0.08%
Great-West 2,990,423 7.62%
TOTAL 39,428,881 100.00%
Maxim INVESCO Balanced Portfolio
Series Account No. of Shares Percentage
<PAGE> 258
<PAGE>
Maxim Series Account 12,732 0.08%
FutureFunds Series Account 200,662 1.31%
FutureFunds II Series Account 12,632,006 82.24
Great-West 2,515,420 16.37%
TOTAL 15,360,820 100.00%
</TABLE>
CALCULATION OF YIELD AND RETURN
Yield of the Money Market Portfolio
As summarized in the Prospectus under the heading "Performance
Related Information," the yield of the Money Market Portfolio
for a seven-day period (the "base period") will be computed by
determining the "net change in value" (calculated as set forth
below) of a hypothetical account having a balance of one share
at the beginning of the period, dividing the net change in
account value by the value of the account at the beginning of
the base period to obtain the base period return, and
multiplying the base period return by 365/7 with the resulting
yield figure carried to the nearest hundredth of one percent.
Net changes in value of a hypothetical account will include
the value of additional shares purchased with dividends from
the original share and dividends declared on both the original
share and any such additional shares, but will not include
realized gains or losses or unrealized appreciation or
depreciation on portfolio investments. Yield may also be
calculated on a compound basis (the "effective yield") which
assumes that net income is reinvested in Portfolio shares at
the same rate as net income is earned for the base period.
The Money Market Portfolio's yield and effective yield will
vary in response to fluctuations in interest rates and in the
expenses of the Portfolio.
The following is an example of this yield calculation for the
Money Market Portfolio based on a seven-day period ending
December 31, 1996.
<TABLE>
<CAPTION>
<S> <C>
Assumptions:
Value of a hypothetical pre-existing
account with exactly one share at the
<PAGE> 259
<PAGE>
beginning of the period: $1.00067671
Value of the same account* (excluding
capital changes) at the end of the
seven-day period: $1.00162761
* This value would include the value of
any additional shares purchased with
dividends from the original share, and
all dividends declared on both the
original share and any such additional
shares.
Calculation:
Ending account value $1.00162761
Less beginning account value 1.00067671
Net change in account value 0.00095090
Base period return:
$0.00095026/$1.00067671 (adjusted
change/beginning account value) = $0.00095026
Current yield = Base period return
x (365/7) = 4.95%
Effective yield = (1 + Base period
return) to the power of 365/7 = 5.08%
</TABLE>
Yields of the Bond, Stock Index*, U.S. Government Securities,
Total Return, Investment Grade Corporate Bond, U.S. Government
Mortgage Securities, Small-Cap Index, Growth Index, Value
Index, Small-Cap Value, International Equity, Corporate Bond,
Small-Cap Aggressive Growth, Foreign Equity, Maxim T. Rowe
Price Equity/Income, Maxim INVESCO Small-Cap Growth, Maxim
INVESCO ADR and Maxim INVESCO Balanced Portfolios
As summarized in the Prospectus under the heading "Performance
Related Information," yields of these Portfolios 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
<PAGE> 260
<PAGE>
the shares of the Portfolios and to the relative risks
associated with the investment objectives and policies of the
Portfolios.
* Prior to December 1, 1992, the Growth Portfolio.
Bond Portfolio
The following is an example of this yield calculation for the
Bond Portfolio based on a 30-day period ending December 31,
1996.
Formula: YIELD = 2[ (a-b)+ 1)6-1]
cd
Where: a = dividends and interest earned during the
period.
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 December 31, 1996:
a = 426,770.52
b = 38,626.67
c = 63,920,655.78
d = 1.20589062
Therefore 1 month yield as of December 31, 1996 is : 6.12%
<PAGE> 261
<PAGE>
Investment Grade Corporate Bond Portfolio
The following is an example of this yield calculation for the
Investment Grade Corporate Bond Portfolio based on a 30-day
period ending December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividends and interest earned during the
period.
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 December 31, 1996:
a = 538,233.23
b = 49,734.43
c = 77,586,867.98
d = 1.27738355
Therefore 1 month yield as of December 31, 1996 is : 5.99%
----------------------------------------------------------------
Stock Index Portfolio1
The following is an example of this yield calculation for the
Stock Index Portfolio based on a 30-day period ending December
31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
b = expenses accrued for the period (net of
reimbursements).
Prior to December 1, 1992, the Growth Portfolio.
<PAGE> 262
<PAGE>
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 December 31, 1996:
a = 1,600,060.41
b = 464,476.81
c = 391,141,680.30
d = 2.36497531
Therefore 1 month yield as of December 31, 1996 is : 1.48%
<PAGE> 263
<PAGE>
U.S. Government Securities Portfolio
The following is an example of this yield calculation for the
U. S. Government Securities Portfolio based on a 30-day period
ending December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 444,876.70
b = 32,030.38
c = 59,305,260.72
d = 1.07381125
Therefore 1 month yield as of December 31, 1996 is : 7.91%
------------------------------------------------------------
U.S. Government Mortgage Securities Portfolio
The following is an example of this yield calculation for the
U. S. Government Mortgage Securities Portfolio based on a 30-
day period ending December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 1,142.381.99
b = 68,085.56
c = 117,746,665.35
<PAGE> 264
<PAGE>
d = 1.15191607
Therefore 1 month yield as of December 31, 1996 is : 9.69%
<PAGE> 265
<PAGE>
Total Return Portfolio
The following is an example of this yield calculation for the
Total Return Portfolio based on a 30-day period ending
December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 162,957,.64
b = 31,792.96
c = 45,955,210.13
d = 1.34116963
Therefore 1 month yield as of December 31, 1996 is : 2.57%
----------------------------------------------------------------
Small-Cap Index Portfolio
The following is an example of this yield calculation for the
Small-Cap Index Portfolio based on a 30-day period ending
December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 133,623.89
b = 38,719.26
c = 59,928.786.98
<PAGE> 266
<PAGE>
d = 1.2369735
Therefore 1 month yield as of December 31, 1996 is : 1.54%
<PAGE> 267
<PAGE>
Growth Index Portfolio
The following is an example of this yield calculation for the
Growth Index Portfolio based on a 30-day period ending
December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 126,244.67
b = 40,931.01
c = 52,543,858.75
d = 1.48524035
Therefore 1 month yield as of December 31, 1996 is : 1.32%
----------------------------------------------------------------
Value Index Portfolio
The following is an example of this yield calculation for the Value
Index Portfolio based on a 30-day period ending December 31,
1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 244,029.82
b = 59,286.53
c = 83,677,521.27
<PAGE> 268
<PAGE>
d = 1.45377343
Therefore 1 month yield as of December 31, 1996 is : 1.83%
<PAGE> 269
<PAGE>
Small-Cap Value Portfolio
The following is an example of this yield calculation for the
Small-Cap Value Portfolio based on a 30-day period ending
December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 85,082.20
b = 32,024.40
c = 28,793,409.83
d = 1.24801888
Therefore 1 month yield as of December 31, 1996 is : 1.78%
----------------------------------------------------------------
International Equity Portfolio
The following is an example of this yield calculation for the
International Equity Portfolio based on a 30-day period ending
December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 27,022.31
b = 78,870.94
c = 70,623,655.14
<PAGE> 270
<PAGE>
d = 1.32291689
Therefore 1 month yield as of December 31, 1996 is : -0.67%
<PAGE> 271
<PAGE>
Corporate Bond Portfolio
The following is an example of this yield calculation for the
Corporate Bond Portfolio based on a 30-day period ending
December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 530,714.06
b = 60,646.31
c = 67,460,744.31
d = 1.16178024
Therefore 1 month yield as of December 31, 1996 is : 7.31%
----------------------------------------------------------------
Small-Cap Aggressive Growth Portfolio
The following is an example of this yield calculation for the
Small-Cap Aggressive Growth Portfolio based on a 30-day period
ending December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 172,517.61
b = 65,609.09
<PAGE> 272
<PAGE>
c = 52,758,430.21
d = 1.40277724
Therefore 1 month yield as of December 31, 1996 is : 1.74%
<PAGE> 273
<PAGE>
Foreign Equity Portfolio
The following is an example of this yield calculation for the
Foreign Equity Portfolio based on a 30-day period ending
December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 123,233.22
b = 75,021.26
c = 74,933,271.34
d = 1.05795162
Therefore 1 month yield as of December 31, 1996 is : 0.73%
----------------------------------------------------------------
Maxim T. Rowe Price Equity/Income Portfolio
The following is an example of this yield calculation for the
Maxim T. Rowe Price Equity/Income Portfolio based on a 30-day
period ending December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 195,691.84
b = 54,148.95
c = 46,003,785.59
<PAGE> 274
<PAGE>
d = 1.44915205
Therefore 1 month yield as of December 31, 1996 is : 2.56%
<PAGE> 275
<PAGE>
Maxim INVESCO Small-Cap Growth Portfolio
The following is an example of this yield calculation for the
Maxim INVESCO Small-Cap Growth Portfolio based on a 30-day
period ending December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 43,712.56
b = 27,969.09
c = 19,387,426.81
d = 1.43301411
Therefore 1 month yield as of December 31, 1996 is : 0.68%
----------------------------------------------------------------
Maxim INVESCO ADR Portfolio
The following is an example of this yield calculation for the
Maxim INVESCO ADR Portfolio based on a 30-day period ending
December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 12,646.07
b = 8,744.16
<PAGE> 276
<PAGE>
c = 5,321,887.70
d = 1.35083696
Therefore 1 month yield as of December 31, 1996 is : 0.65%
<PAGE> 277
<PAGE>
MidCap Portfolio
The following is an example of this yield calculation for the
MidCap Portfolio based on a 30-day period ending December 31,
1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 16,942.62
b = 209,269.29
c = 149,256,535.86
d = 1.43265039
Therefore 1 month yield as of December 31, 1996 is : -1.08%
----------------------------------------------------------------
Short-Term Maturity Bond Portfolio
The following is an example of this yield calculation for the
Short-Term Maturity Bond Portfolio based on a 30-day period
ending December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 186,979.64
b = 19,196.57
c = 38,296,680.29
<PAGE> 278
<PAGE>
d = 1.00647746
Therefore 1 month yield as of December 31, 1996 is : 5.28%
Maxim INVESCO Balanced Portfolio
The following is an example of this yield calculation for the
Maxim INVESCO Balanced Portfolio based on a 30-day period
ending December 31, 1996.
Formula: YIELD = 2[ (a-b +1)6-1]
cd
Where: a = dividend and interest earned during the period.
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 December 31, 1996:
a = 48,622.95
b = 12,921.83
c = 15,071,714.79
d = 1.04077551
Therefore 1 month yield as of December 31, 1996 is : 2.75%
At any time in the future, yields and total return may be
higher or lower than past yields and there can be no assurance
that any historical results will continue.
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
<PAGE> 279
<PAGE>
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.
<PAGE> 280
<PAGE>
BOND PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
10 year total return as of December 31, 1996:
ERV = 4.21713
N = 10.0 (Dec/86 to Dec/96)
P = 2.04932
Therefore 10 year total return as of December 31, 1996 is
7.48% compounded annually.
5 year total return as of December 31, 1996:
ERV = 4.21731
N = 5.00 (Dec/91 to Dec/96)
P = 3.11798
Therefore 5 year total return as of December 31, 1996 is
6.23% compounded annually.
1 year total return as of December 31, 1996:
ERV = 4.21731
N = 1.00 (Dec/95 to Dec/96)
P = 4.04477
Therefore 1 year total return as of December 31, 1996 is
4.26% compounded annually.
<PAGE> 281
<PAGE>
INVESTMENT GRADE CORPORATE BOND PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.65320
N = 4.08333 (Dec/92 to Dec/96)
P = 1.28513
Therefore inception total return as of December 31, 1996 is
6.36% compounded annually.
1 year total return as of December 31, 1996:
ERV = 1.65320
N = 1.00 (Dec/95 to Dec/96)
P = 1.60293
Therefore 1 year total return as of December 31, 1996 is 3.14%
compounded annually.
<PAGE> 282
<PAGE>
STOCK INDEX PORTFOLIO*
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
10 year total return as of December 31, 1996:
ERV = 6.4931
N = 10.0 (Dec/86 to Dec/96)
P = 1.91478
Therefore 10 year total return as of December 31, 1996 is
12.99% compounded annually.
5 year total return as of December 31, 1996:
ERV = 6.4931
N = 5.00 (Dec/91 to Dec/96)
P = 3.37588
Therefore 5 year total return as of December 31, 1996 is
13.98% compounded annually.
1 year total return as of December 31, 1996:
ERV = 6.4931
N = 1.00 (Dec/95 to Dec/96)
P = 5.3306
Therefore 1 year total return as of December 31, 1996 is
21.81% compounded annually.
* Prior to December 1, 1992, the Growth Portfolio.
<PAGE> 283
<PAGE>
U.S. GOVERNMENT SECURITIES PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Ten year total return as of December 31, 1996:
ERV = 2.75589
N = 10.0 (Dec/86 to Dec/96)
P = 1.25798
Therefore ten year total return as of December 31, 1996 is
8.16% compounded annually.
5 year total return as of December 31, 1996:
ERV = 2.75589
N = 5.00 (Dec/91 to Dec/96)
P = 1.98088
Therefore 5 year total return as of December 31, 1996 is
6.83% compounded annually.
1 year total return as of December 31, 1996:
ERV = 2.75589
N = 1.00 (Dec/95 to Dec/96)
P = 2.65189
Therefore 1 year total return as of December 31, 1996 is
3.92% compounded annually.
<PAGE> 284
<PAGE>
U.S. GOVERNMENT MORTGAGE SECURITIES PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.50046
N = 4.08 (Dec/92 to Dec/96)
P = 1.14152
Therefore inception total return as of December 31, 1996 is
6.93% compounded annually.
1 year total return as of December 31, 1996:
ERV = 1.50046
N = 1.00 (Dec/95 to Dec/96)
P = 1.43872
Therefore 1 year total return as of December 31, 1996 is
4.30% compounded annually.
<PAGE> 285
<PAGE>
TOTAL RETURN PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 2.32435
N = 9.41667 (Aug/87 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
9.37% compounded annually.
5 year total return as of December 31, 1996:
ERV = 2.32435
N = 5.00 (Dec/91 to Dec/96)
P = 1.47227
Therefore 1 year total return as of December 31, 1996 is
9.56% compounded annually.
1 year total return as of December 31, 1996:
ERV = 2.32435
N = 1.00 (Dec/95 to Dec/96)
P = 2.07986
Therefore 1 year total return as of December 31, 1996 is
11.76% compounded annually.
<PAGE> 286
<PAGE>
SMALL-CAP INDEX PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.40417
N = 3.08333 (Dec/93 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
11.64% compounded annually.
1 year total return as of December 31, 1996:
ERV = 1.40417
N = 1.00 (Dec/95 to Dec/96)
P = 1.21781
Therefore 1 year total return as of December 31, 1996 is
15.30% compounded annually.
<PAGE> 287
<PAGE>
GROWTH INDEX PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.69712
N = 3.08333 (Dec/93 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
18.71% compounded annually.
1 year total return as of December 31, 1996:
ERV = 1.60712
N = 1.00 (Dec/95 to Dec/96)
P = 1.38992
Therefore 1 year total return as of December 31, 1996 is
22.09% compounded annually.
<PAGE> 288
<PAGE>
VALUE INDEX PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.63053
N = 3.08333 (Dec/93 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
17.18% compounded annually.
1 year total return as of December 31, 1996:
ERV = 1.63053
N = 1.00 (Dec/95 to Dec/96)
P = 1.35158
Therefore 1 year total return as of December 31, 1996 is
20.64% compounded annually.
<PAGE> 289
<PAGE>
SMALL-CAP VALUE PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.36977
N = 3.08333 (Dec/93 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
10.74% compounded annually.
1 year total return as of December 31, 1996:
ERV = 1.36977
N = 1.00 (Dec/95 to Dec/96)
P = 1.16136
Therefore 1 year total return as of December 31, 1996 is
17.95% compounded annually.
INTERNATIONAL EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of N = ERV
WHERE:
T = Average annual total return
<PAGE> 290
<PAGE>
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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.39788
N = 3.08333 (Dec/93 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
11.48% compounded annually.
1 year total return as of December 31, 1996:
ERV = 1.39788
N = 1.00 (Dec/95 to Dec/96)
P = 1.16901
Therefore 1 year total return as of December 31, 1996 is
19.59% compounded annually.
<PAGE> 291
<PAGE>
CORPORATE BOND PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.41547
N = 2.16667 (Nov/94 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
17.39% compounded annually.
One year total return as of December 31, 1996:
ERV = 1.41547
N = 1.00 (Dec/95 to Dec/96)
P = 1.28272
Therefore one year total return as of December 31, 1996 is
10.37% compounded annually.
SMALL-CAP AGGRESSIVE GROWTH PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of N = ERV
WHERE:
T = Average annual total return
<PAGE> 292
<PAGE>
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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.64912
N = 2.16667 (Nov/94 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
25.97% compounded annually.
One year total return as of December 31, 1996:
ERV= 1.64912
N= 1.00 (Dec/95 to Dec/96)
P= 1.26769
Therefore one year total return as of December 31, 1996 is
30.09% compounded annually.
<PAGE> 293
<PAGE>
FOREIGN EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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 a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.07529
N = 2.16667 (Nov/94 to Dec/96)
P =1.00000
Therefore inception total return as of December 31, 1996 is
3.41% compounded annually.
One year total return as of December 31, 1996:
ERV = 1.07529
N=1.00 (Dec/95 to Dec/96)
P =0.99927
Therefore one year total return as of December 31, 1996 is 7.62%
compounded annually.
MAXIM T. ROWE PRICE EQUITY/INCOME PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of N = ERV
WHERE:
T =Average annual total return
<PAGE> 294
<PAGE>
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
a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.57155
N =2.16677 (Nov/94 to Dec/96)
P =1.00000
Therefore inception total return as of December 31, 1996 is
23.20% compounded annually.
One year total return as of December 31, 1996:
ERV = 1.57155
N =1.00 (Dec/95 to Dec/96)
P =1.31635
Therefore one year total return as of December 31, 1996 is
19.39% compounded annually.
<PAGE> 295
<PAGE>
MAXIM INVESCO SMALL-CAP GROWTH PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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
a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.68422
N =2.16667 (Nov/94 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
27.20% compounded annually.
One year total return as of December 31, 1996:
ERV = 1.68422
N =1.00 (Dec/95 to Dec/96)
P =1.32897
Therefore one year total return as of December 31, 1996 is
26.74% compounded annually.
MAXIM INVESCO ADR PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of N = ERV
WHERE:
T =Average annual total return
<PAGE> 296
<PAGE>
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
a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.38311
N = 2.16667 (Nov/94 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
16.15% compounded annually.
One year total return as of December 31, 1996:
ERV = 1.38311
N =1.00 (Dec/95 to Dec/96)
P =1.14143
Therefore one year total return as of December 31, 1996 is
21.17% compounded annually.
<PAGE> 297
<PAGE>
MIDCAP PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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
a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.48591
N = 3.00 (Jan 1/94 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
14.11% compounded annually.
One year total return as of December 31, 1996:
ERV = 1.48591
N =1.00 (Dec/95 to Dec/96)
P =1.40233
Therefore one year total return as of December 31, 1996 is
5.96% compounded annually.
<PAGE> 298
<PAGE>
SHORT-TERM MATURITY BOND PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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
a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.07858
N = 1.41667 (Aug 1/95 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
5.48% compounded annually.
One year total return as of December 31, 1996:
ERV = 1.07858
N =1.00 (Dec/95 to Dec/96)
P =1.03019
Therefore one year total return as of December 31, 1996 is
4.70% compounded annually.
<PAGE> 299
<PAGE>
MAXIM INVESCO BALANCED PORTFOLIO
TOTAL RETURN PERFORMANCE
FORMULA:P(1+T) to the power of 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
a 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) to the power of 1/N]-1
Inception total return as of December 31, 1996:
ERV = 1.04597
N = 0.25000 (Oct 1/96 to Dec/96)
P = 1.00000
Therefore inception total return as of December 31, 1996 is
19.70% compounded annually.
<PAGE> 300
<PAGE>
Performance Comparisons
Each Portfolio may from time to time include its yield and/or
total return in advertisements or in information furnished to
present or prospective shareholders. Each Portfolio may include
in such advertisements the ranking of those performance figures
relative to such figures for groups of mutual funds categorized
by Lipper Analytical Services, relevant indexes and Donoghue
Money Fund Report as having the same or similar investment
objectives.
The manner in which total return and yield will be calculated for
public use is described above. The table in the Prospectus under
the heading "Performance Related Information", summarizes the
calculation of total return and yield for each Portfolio, where
applicable, through December 31, 1996.
<PAGE> 301
<PAGE>
Price Make-up Sheet
Money Market Portfolio
<TABLE>
<CAPTION>
Year Ended 12/31/96 Per Share Amount
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 0
Ordinary Income 18,518,195
Operational Expenses (1,566,842)
Net Investment Income 16,951,353
Dividend Distribution - End of Year (16,951,353)
Undistributed Net Investment Income -
End of Year 0 0.0000
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 0
Distribution from Net Short-Term Gain 0
Accumulated Undistributed Net Short-
Term Realized Gain (Loss) on 0 0.0000
Investment
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 0
Distribution from Net Long-Term
Realized Gain 0
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment
0 0.000
Net Unrealized Appreciation
(Depreciation) on Investments 0 0.000
Capital Stock at Par 39,618,509 0.1000
<PAGE> 302
<PAGE>
Additional Paid-in Capital 356,834,679 0.9007
Net Assets 396,453,188 1.0007
Shares Outstanding 396,185,085
</TABLE>
<PAGE> 303
<PAGE>
Price Make-up Sheet
Bond Portfolio
<TABLE>
<CAPTION>
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income
- Beginning of Year $ 0
Dividend Income 0
Ordinary Income 5,247,243
Operational Expenses (470,658)
Net Investment Income 4,776,585
Dividend Distribution - End of Year (4,776,585)
Undistributed Net Investment Income 0 0.000
- End of Year
Net Short-Term Realized Gain (Loss)
on Investments - Beginning of 0
Year
Net Short-Term Realized Gain (Loss) (1,025,192)
on Investments - End of Year
Distribution from Net Short-Term 0
Gain
Accumulated Undistributed Net Short-
Term Realized Gain (Loss) on (1,025,192) (0.0159)
Investment
Net Long-Term Realized Gain (Loss)
on Investments - Beginning of (564,537)
Year
Net Long-Term Realized Gain (Loss)
on Investments - End of Year 114,977
Distribution from Net Long-Term 0
Realized Gain
Accumulated Undistributed Net Long-
Term Realized Gain (Loss) on (449,560) (0.0069)
Investment
<PAGE> 304
<PAGE>
Net Unrealized Appreciation
(Depreciation) on Investments 466,607 0.0072
Capital Stock at Par 6,475,970 0.1000
Additional Paid-in Capital 72,625,284 1.1215
Net Assets 78,093,109 1.2059
Shares Outstanding 64,759,695
</TABLE>
<PAGE> 305
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Investment Grade Corporate Bond Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 0
Ordinary Income 6,415,480
Operational Expenses (575,853)
Net Investment Income 5,839,627
Dividend Distribution - End of Year (5,839,627)
Undistributed Net Investment Income - End
of Year 0 0.000
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year
Net Short-Term Realized Gain (Loss) on
Investments - End of Year (1,238,570) 0
Distribution from Net Short-Term Gain 0
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment (1,238,570) (0.0157)
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 80,051
Distribution from Net Long-Term Realized 0
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment 80,051 0.0010
Net Unrealized Appreciation
(Depreciation) on Investments 647,612 0.0082
Capital Stock at Par 7,885,036 0.1000
<PAGE> 306
<PAGE>
Additional Paid-in Capital 93,348,023 1.1839
Net Assets 100,722,152 1.2774
Shares Outstanding 78,850,360
</TABLE>
<PAGE> 307
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Stock Index Portfolio*
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $0
Dividend Income 17,361,945
Ordinary Income 347,152
Operational Expenses (4,887,975)
Net Investment Income 12,821,122
Dividend Distribution - End of Year (12,821,122)
Undistributed Net Investment Income -
End of Year 0 0.000
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 367,869
Distribution from Net Short-Term Gain (339,118)
Accumulated Undistributed Net Short-
Term Realized Gain (Loss) on 28,751 0.0001
Investment
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 4,072,466
Distribution from Net Long-Term (3,808,466)
Realized Gain
Accumulated Undistributed Net Long-Term 264,000 0.0007
Realized Gain (Loss) on Investment
Net Unrealized Appreciation
(Depreciation) on Investments 338,974,334 0.8557
Capital Stock at Par 39,611,676 0.1000
<PAGE> 308
<PAGE>
Additional Paid-in Capital 557,927,597 1.4085
Net Assets 936,806,358 2.3650
Shares Outstanding 397,116,761
* Prior to December 1, 1992, the Growth Portfolio
</TABLE>
<PAGE> 309
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
U.S. Government Securities Portfolio
Year Ended Per Share
12/31/96 Amount
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year (30,000)
Dividend Income
0
Ordinary Income 4,415,879
Operational Expenses (390,629)
Net Investment Income 4,025,250
Dividend Distribution - End of Year (4,025,250)
Undistributed Net Investment Income - (30,000) (0.0005)
End of Year
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year (194,811)
Distribution from Net Short-Term Gain 0
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment (194,811) (0.0033)
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year (2,661,476)
Net Long-Term Realized Gain (Loss) on
Investments - End of Year (10,233)
Distribution from Net Long-Term Realized 0
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment (2,671,709) (0.0448)
Net Unrealized Appreciation (Depreciation)
on Investments 1,406,558 0.0236
<PAGE> 310
<PAGE>
Capital Stock at Par 5,967,330 0.1000
Additional Paid-in Capital 59,600,495 0.9988
Net Assets 64,077,863 1.0738
Shares Outstanding 59,673,302
</TABLE>
<PAGE> 311
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
U.S. Mortgage Government Securities Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 0
Ordinary Income 9,387,266
Operational Expenses (791,813)
Net Investment Income 8,595,453
Dividend Distribution - End of Year (8,595,453)
Undistributed Net Investment Income -
End of Year 0 0.0000
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year
0
Net Short-Term Realized Gain (Loss) on (344,155)
Investments - End of Year
Distribution from Net Short-Term Gain
0
Accumulated Undistributed Net Short- (344,155) (0.0028)
Term Realized Gain (Loss) on
Investment
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year (3,550,757)
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 154,023
Distribution from Net Long-Term 0
Realized Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment (3,396,734) (0.0283)
<PAGE> 312
<PAGE>
Net Unrealized Appreciation
(Depreciation) on Investments 2,355,559 0.0196
Capital Stock at Par 12,020,486 0.1000
Additional Paid-in Capital 127,830,752 1.0634
Net Assets 138,465,908 1.1519
Shares Outstanding 120,204,859
</TABLE>
<PAGE> 313
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Total Return Portfolio
Year Ended Per Share Amount
12/31/96 <C>
<S> <C>
Undistributed Net Investment Income - $ 0
Beginning of Year
Dividend Income 464,753
Ordinary Income 1,584,546
Operational Expenses (364,049)
Net Investment Income 1,685,250
Dividend Distribution - End of Year (1,685,250)
Undistributed Net Investment Income - End
of Year 0 0.0000
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year (61,774)
Distribution from Net Short-Term Gain 0
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment (61,774) (0.0012)
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 3,392,612
Distribution from Net Long-Term Realized (3,179,662)
Gain
Accumulated Undistributed Net Long-Term 212,950 0.0044
Realized Gain (Loss) on Investment
Net Unrealized Appreciation
(Depreciation) on Investments 8,992,502 0.1865
Capital Stock at Par 4,821,225 0.1000
<PAGE> 314
<PAGE>
Additional Paid-in Capital 50,695,901 1.0515
Net Assets 64,660,804 1.3412
Shares Outstanding 48,212,249
</TABLE>
<PAGE> 315
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Small-Cap Index Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 1,069,433
Ordinary Income 39,307
Operational Expenses (404,891)
Net Investment Income 703,849
Dividend Distribution - End of Year (703,849)
Undistributed Net Investment Income -End
of Year 0 0.0000
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 2,204,892
Distribution from Net Short-Term Gain (2,251,691)
Accumulated Undistributed Net Short-Term (46,799) (0.0007)
Realized Gain (Loss) on Investment
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 3,428,509
Distribution from Net Long-Term Realized (3,583,470)
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment (154,961) (0.0024)
Net Unrealized Appreciation
(Depreciation) on Investments 9,774,928 0.1497
Capital Stock at Par 6,530,754 0.1000
<PAGE> 316
<PAGE>
Additional Paid-in Capital 64,679,770 0.9904
Net Assets 80,783,692 1.2370
Shares Outstanding 65,307,537
</TABLE>
<PAGE> 317
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Growth Index Portfolio
Year Ended Per Share
12/31/96 Amount
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 838,053
Ordinary Income 47,650
Operational Expenses (371,758)
Net Investment Income 513,945
Dividend Distribution - End of Year (531,945)
Undistributed Net Investment Income -
End of Year 0 0.0000
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 336,540
Distribution from Net Short-Term Gain (431,588)
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment (95,048) (0.0017)
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on 6,909,305
Investments - End of Year
Distribution from Net Long-Term Realized (7,032,586)
Gain
Accumulated Undistributed Net Long-Term (123,281) (0.0022)
Realized Gain (Loss) on Investment
Net Unrealized Appreciation (Depreciation)
on Investments 12,206,193 0.2165
Capital Stock at Par 5,638,361 0.1000
<PAGE> 318
<PAGE>
Additional Paid-in Capital 66,116,985 1.1726
Net Assets 83,743,210 1.4852
Shares Outstanding 56,383,608
</TABLE>
<PAGE> 319
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Value Index Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 2,682,582
Ordinary Income 63,998
Operational Expenses (552,296)
Net Investment Income 2,194,284
Dividend Distribution - End of Year (2,194,284)
Undistributed Net Investment Income -
End of Year 0 0.0000
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on 816,122
Investments - End of Year
Distribution from Net Short-Term Gain (813,590)
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment 2,532 0.0000
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 2,185,585
Distribution from Net Long-Term Realized (2,186,139)
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment (554) 0.0000
Net Unrealized Appreciation (Depreciation)
on Investments 23,205,929 0.2759
Capital Stock at Par 8,411,423 0.1000
<PAGE> 320
<PAGE>
Additional Paid-in Capital 90,663,696 1.0779
Net Assets 122,283,026 1.4538
Shares Outstanding 84,114,226
</TABLE>
<PAGE> 321
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Small-Cap Value Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 497,727
Ordinary Income 107,235
Operational Expenses (356,332)
Net Investment Income 248,630
Dividend Distribution - End of Year (248,630)
Undistributed Net Investment Income - 0 0.0000
End of Year
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year (309,786)
Distribution from Net Short-Term Gain 0
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment (309,786) (0.0106)
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on (184,769)
Investments - End of Year
Distribution from Net Long-Term Realized 0
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment (184,769) (0.0063)
Net Unrealized Appreciation
(Depreciation) on Investments 6,472,815 0.2207
Capital Stock at Par 2,932,620 0.1000
<PAGE> 322
<PAGE>
Additional Paid-in Capital 27,688,771 0.9442
Net Assets 36,599,651 1.2480
Shares Outstanding 29,326,200
</TABLE>
<PAGE> 323
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
International Equity Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income - $ 0
Beginning of Year
Dividend Income 1,653,805
Ordinary Income 318,304
Operational Expenses (1,030,739)
Net Investment Income 941,370
Dividend Distribution - End of Year (941,370)
Undistributed Net Investment Income - 0 0.0000
End of Year
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 692,684
Distribution from Net Short-Term Gain (315,019)
Accumulated Undistributed Net Short-Term 377,665 0.0051
Realized Gain (Loss) on Investment
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 1,486,313
Distribution from Net Long-Term Realized (1,466,872)
Gain
Accumulated Undistributed Net Long-Term 19,441 0.0003
Realized Gain (Loss) on Investment
<PAGE> 324
<PAGE>
Net Unrealized Appreciation
(Depreciation) on Investments and 13,737,651 0.1890
Net Unrealized Appreciation
(Depreciation on translation of
assets and liabilities denominated
in foreign currencies
Capital Stock at Par 7,269,697 0.1000
Additional Paid-in Capital 74,767,595 1.0285
Net Assets 96,172,049 1.3229
Shares Outstanding 72,696,970
</TABLE>
<PAGE> 325
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
MidCap Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 297,903
Ordinary Income 466,960
Operational Expenses (2,010,061)
Net Investment Income (1,245,198)
Dividend Distribution - End of Year 0
Undistributed Net Investment Income - End
of Year (1,245,198) (0.0083)
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year (4,870,222)
Distribution from Net Short-Term Gain 0
Accumulated Undistributed Net Short-Term (0.0325)
Realized Gain (Loss) on Investment (4,870,222)
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on 7,597,142
Investments - End of Year
Distribution from Net Long-Term Realized (275,863)
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment 7,321,279 0.0489
<PAGE> 326
<PAGE>
Net Unrealized Appreciation
(Depreciation) on Investments and 31,733,769 0.2117
Net Unrealized Appreciation
(Depreciation) on translation of
assets and liabilities denominated
in foreign currencies
Capital Stock at Par 14,986,964 0.1000
Additional Paid-in Capital 166,784,211 1.1129
Net Assets 214,710,803 1.4327
Shares Outstanding 149,869,643
</TABLE>
<PAGE> 327
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Corporate Bond Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 341,839
Ordinary Income 5,149,929
Operational Expenses (574,728)
Net Investment Income 4,917,040
Dividend Distribution - End of Year (4,917,040)
Undistributed Net Investment Income - End 0 0.0000
of Year
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 503,724
Distribution from Net Short-Term Gain (371,342)
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment 132,382 0.0018
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 1,443,988
Distribution from Net Long-Term Realized (1,162,203)
Gain
Accumulated Undistributed Net Long-Term 281,785 0.0039
Realized Gain (Loss) on Investment
<PAGE> 328
<PAGE>
Net Unrealized Appreciation
(Depreciation) on Investments and 3,769,367 0.0524
Net Unrealized Appreciation
(Depreciation) on translation of
assets and liabilities denominated
in foreign currencies
Capital Stock at Par 7,199,729 0.1000
Additional Paid-in Capital 72,261,766 1.0037
Net Assets 83,645,029 1.1618
Shares Outstanding 71,997,289
</TABLE>
<PAGE> 329
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Small-Cap Aggressive Growth Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $(21,665)
Dividend Income 644,309
Ordinary Income 397,141
Operational Expenses (577,497)
Net Investment Income 463,953
Dividend Distribution - End of Year (463,953)
Undistributed Net Investment Income -
End of Year (21,665) (0.0004)
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 3,358,025
Distribution from Net Short-Term Gain (3,119,913)
Accumulated Undistributed Net Short-
Term Realized Gain (Loss) on 238,112 0.0042
Investment
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 2,255,775
Distribution from Net Long-Term (1,858,939)
Realized Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment 396,836 0.0070
Net Unrealized Appreciation
(Depreciation) on Investments 9,859,809 0.1730
<PAGE> 330
<PAGE>
Capital Stock at Par 5,699,046 0.1000
Additional Paid-in Capital 63,772,788 1.1190
Net Assets 79,944,926 1.4028
Shares Outstanding 56,990,464
</TABLE>
<PAGE> 331
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Foreign Equity Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $(395,257)
Dividend Income 1,195,658
Ordinary Income 127,750
Operational Expenses (1,029,873)
Net Investment Income 293,535
Dividend Distribution - End of Year (293,535)
Undistributed Net Investment Income -
End of Year (395,257) (0.0052)
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 1,493,498
Distribution from Net Short-Term Gain 0
Accumulated Undistributed Net Short-
Term Realized Gain (Loss) on 1,493,498 (0.0173)
Investment
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year (3,227,710)
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 1,913,362
Distribution from Net Long-Term 0
Realized Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment (1,314,348) (0.0173)
<PAGE> 332
<PAGE>
Net Unrealized Appreciation
(Depreciation) on Investments and 5,897,203 0.0779
Net Unrealized Appreciation
(Depreciation) on translation of
assets and liabilities denominated
in foreign currencies
Capital Stock at Par 7,571,845 0.1000
Additional Paid-in Capital 66,853,518 0.8829
Net Assets 80,106,459 1.0580
Shares Outstanding 75,718,452
</TABLE>
<PAGE> 333
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Maxim T. Rowe Price Equity/Income Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 919,410
Ordinary Income 311,340
Operational Expenses (306,028)
Net Investment Income 924,722
Dividend Distribution - End of Year (924,722)
Undistributed Net Investment Income -End 0 0.0000
of Year
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on 562,055
Investments - End of Year
Distribution from Net Short-Term Gain (563,081)
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment (1,026) 0.0000
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 698,855
Distribution from Net Long-Term Realized (698,855)
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment 0 0.0000
<PAGE> 334
<PAGE>
Net Unrealized Appreciation
(Depreciation) on Investments and 5,638,904 0.1175
Net Unrealized Appreciation
(Depreciation) on translation of
assets and liabilities denominated
in foreign currencies
Capital Stock at Par 4,798,386 0.1000
Additional Paid-in Capital 59,099,639 1.2317
Net Assets 69,535,903 1.4492
Shares Outstanding 47,983,856
</TABLE>
<PAGE> 335
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Maxim INVESCO Small-Cap Growth Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 16,307
Ordinary Income 236,573
Operational Expenses (206,106)
Net Investment Income 46,774
Dividend Distribution - End of Year (46,774)
Undistributed Net Investment Income -End 0 0.0000
of Year
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 2,959,837
Distribution from Net Short-Term Gain (3,017,417)
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment (57,580) (0.0026)
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 500,649
Distribution from Net Long-Term Realized (500,649)
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment 0 0.0000
Net Unrealized Appreciation
(Depreciation) on Investments (118,082) (0.0053)
Capital Stock at Par 2,221,037 0.1000
<PAGE> 336
<PAGE>
Additional Paid-in Capital 29,782,403 1.3409
Net Assets 31,827,778 1,4330
Shares Outstanding 22,210,373
</TABLE>
<PAGE> 337
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Maxim INVESCO ADR Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 98,970
Ordinary Income 16,027
Operational Expenses (60,239)
Net Investment Income 54,758
Dividend Distribution - End of Year (54,758)
Undistributed Net Investment Income - 0 0.0000
End of Year
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year 2,259
Distribution from Net Short-Term Gain 0
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment 2,259 0.0004
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year (15,301)
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 20,327
Distribution from Net Long-Term Realized (7,284)
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment (2,258) (0.0004)
Net Unrealized Appreciation
(Depreciation) on Investments 1,194,855 0.2097
Capital Stock at Par 569,636 0.1000
<PAGE> 338
<PAGE>
Additional Paid-in Capital 5,930,366 1.0411
Net Assets 7,694,858 1.3508
Shares Outstanding 5,696,363
</TABLE>
<PAGE> 339
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Short-Term Maturity Bond Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 0
Ordinary Income 1,729,701
Operational Expenses (179,920)
Net Investment Income 1,549,781
Dividend Distribution - End of Year (1,549,781)
Undistributed Net Investment Income -
End of Year 0 0.0000
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on
Investments - End of Year (60,079)
Distribution from Net Short-Term Gain 0
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment (60,079) (0.0015)
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 0
Distribution from Net Long-Term Realized 0
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment 0 0.0000
Net Unrealized Appreciation
(Depreciation) on Investments 141,471 0.0036
Capital Stock at Par 3,924,888 0.1000
<PAGE> 340
<PAGE>
Additional Paid-in Capital 35,496,834 0.9044
Net Assets 39,503,114 1.0065
Shares Outstanding 39,248,881
</TABLE>
<PAGE> 341
<PAGE>
<TABLE>
<CAPTION>
Price Make-up Sheet
Maxim INVESCO Balanced Portfolio
Year Ended Per Share Amount
12/31/96
<S> <C> <C>
Undistributed Net Investment Income -
Beginning of Year $ 0
Dividend Income 24,079
Ordinary Income 82,345
Operational Expenses (26,984)
Net Investment Income 79,440
Dividend Distribution - End of Year (79,440)
Undistributed Net Investment Income -End 0 0.0000
of Year
Net Short-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Short-Term Realized Gain (Loss) on (15,106)
Investments - End of Year
Distribution from Net Short-Term Gain (18,660)
Accumulated Undistributed Net Short-Term
Realized Gain (Loss) on Investment (33,766) (0.0022)
Net Long-Term Realized Gain (Loss) on
Investments - Beginning of Year 0
Net Long-Term Realized Gain (Loss) on
Investments - End of Year 0
Distribution from Net Long-Term Realized 0
Gain
Accumulated Undistributed Net Long-Term
Realized Gain (Loss) on Investment 0 0.0000
Net Unrealized Appreciation
(Depreciation) on Investments 266,572 0.0174
Capital Stock at Par 1,536,082 0.1000
<PAGE> 342
<PAGE>
Additional Paid-in Capital 14,218,278 0.9256
Net Assets 15,987,166 1.0408
Shares Outstanding 15,360,820
</TABLE>
<PAGE> 343
<PAGE>
FINANCIAL STATEMENTS
Financial statements of Maxim Series Fund, Inc. are
incorporated by reference from the Fund's Form N-30D filed
with the Securities and Exchange Commission via EDGAR
transmission on February 28, 1997.
<PAGE> 344
<PAGE>
PART C
<PAGE> 345
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits.
(a) Financial Statements.
The financial statements are incorporated by
referenced to Registrant's N-30D filed via
EDGAR on February 28, 1997.
(b) Exhibits.
Items (b)(1)-(4), (b)(6)-(7), (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.
Item (b)(5) is incorporated by reference to
Registrant's Post-Effective Amendments Nos.
28 and 29 dated September 1, 1994 and Post-
Effective Amendment No. 49 dated February 14,
1997. Advisory agreements relating to the
Maxim MidCap Growth and Maxim Blue Chip
Portfolios to be filed by amendment.
Item (b)(8) is incorporated by reference to
Registrant's Post-Effective Amendment No. 24
dated March 1, 1993.
Computation of Performance Quotations are set
forth in the Statement of Additional
Information.
Items (b)(9) and (b)(14)-(15) are not
applicable.
(11) Written Consents
(a) Written consent of Jorden Burt
Berenson & Johnson, LLP.
(b) Written consent of Deloitte &
Touche LLP, Independent Auditors
for the Fund.
Item 25. Persons Controlled by or under Common Control with
Registrant.
<PAGE>
<PAGE>
The organizational chart showing persons
controlled by or under common control with
Registrant is disclosed on page C-1a
Item 26. Number of Holders of Securities:
(1) (2)
Number of Record Holders
Title of Class as of December 31, 1996
Common Stock ($.10 par value) 7
<PAGE>
<PAGE>
ORGANIZATIONAL CHART
Power Corporation of Canada, a Canadian company
100% - Marquette Communications Corporation, a Canadian
company
100% - 171263 Canada Inc., a Canadian company
68.1% - Power Financial Corporation, a Canadian company
86.4% - Great-West Lifeco Inc., a Canadian company
99.5% - The Great-West Life Assurance Company, a Canadian
company
100% - Great-West Life & Annuity Insurance Company, a
Colorado company
100% - First Great-West Life & Annuity
Insurance Company, a New York company
100% - GW Capital Management, Inc., a Colorado
company
100% - Financial Administrative Services
Corporation, a Colorado company
100% - One Corporation, a Colorado company
100% - One Health Plan of Illinois, Inc., an
Illinois company
100% - One Health Plan of Texas, Inc., a Texas
company
100% - One Health Plan of California, Inc., a
California company
100% - One Health Plan of Colorado, Inc., a
Colorado company
100% - One Health Plan of Georgia, Inc., a
Georgia company
100% - One Health Plan of North Carolina, a
North Carolina company
100% - One Health Plan of Washington, a
Washington company
100% - One Orchard Equities, Inc., a Colorado
company
100% - Great-West Benefit Services, Inc., a Delaware company
13% - Private Healthcare Systems, Inc., a Massachusetts
company
100% - Benefits Communication Corporation, a Delaware company
100% - BenefitsCorp Equities, Inc., a Delaware company
94% - Maxim Series Fund, Inc., a Maryland company
100% - Greenwood Property Corporation, a Colorado company
100% - GWL Properties Inc., a Colorado company
100% - Great-West Realty Investments Inc., a
Delaware company
50% - Westkin Properties Ltd., a California
limited partnership
100% - Confed Admin Services, Inc., a Delaware company
100% - Orchard Series Fund, a Delaware business trust
<PAGE>
<PAGE>
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.
The Registrant undertakes to furnish each person
to whom a prospectus is delivered with a copy of
the 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 of the requirements for effectiveness of
this Registration Statement pursuant to Rule 485(b) under
the Securities Act of 1933 and has duly caused Post-
Effective Amendment No. 51 to the Registration Statement to
<PAGE>
<PAGE>
be signed on its behalf, in the City of Englewood, State of
Colorado on the 25th day of April, 1997.
MAXIM SERIES FUND, INC.
(Registrant)
By: /s/ J.D. Motz
President (J.D. Motz)
Pursuant to the requirements of the Securities Act of 1933,
this Post-Effective Amendment No. 51 to the Registration
Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature and Title Date
/s/ J.D. Motz April 25, 1997
President (J.D. Motz)
/s/ D.L. Wooden April 25, 1997
Director (D.L. Wooden)
/s/ R. Jennings* April 25, 1997
Director (R. Jennings)
/s/ R.P. Koeppe* April 25, 1997
Director (R.P. Koeppe)
Signature and Title Date
/s/ J.D. Motz April 25, 1997
Director (J.D. Motz)
/s/ S. Zisman* April 25, 1997
Director (S. Zisman)
/s/ G.R. Derback April 25, 1997
Treasurer (G.R. Derback)
/s/ G.R. Derback April 25, 1997
<PAGE>
<PAGE>
Principal Financial Officer
(G.R. Derback)
/s/ G.R. Derback April 25, 1997
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.
<PAGE>
<PAGE>
EXHIBIT 11(a)
JORDEN BURT BERENSON & JOHNSON LLP
1025 Thomas Jefferson Street, N.W.
Washington, D.C. 20007
Tel: (202) 965-8100
Telecopier: (202) 965-8104
April 18, 1997
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. 51 to the Registration Statement on
Form N-1A (File No. 2-75503) filed by Maxim Series Fund, Inc.
w i th 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>
EXHIBIT 11(b)
INDEPENDENT AUDITORS CONSENT
We consent to the use in this Post-Effective Amendment No. 51
to Registration Statement No. 2-75503 of Maxim Series Fund,
Inc. of our report dated January 31, 1997 appearing in the
Statement of Additional Information, which is a part of such
Registration Statement, and to the reference to us under the
heading "Independent Auditors" appearing in the Prospectus,
which is also a part of such Registration Statement.
/S/ DELOITTE & TOUCHE LLP
DELOITTE & TOUCHE LLP
Denver, Colorado
April 28, 1997<PAGE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 1
<NAME> MAXIM BOND PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 76,054,308
<INVESTMENTS-AT-VALUE> 76,520,915
<RECEIVABLES> 1,603,961
<ASSETS-OTHER> 10,983
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 78,135,859
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 42,750
<TOTAL-LIABILITIES> 42,750
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 79,101,254
<SHARES-COMMON-STOCK> 64,759,695
<SHARES-COMMON-PRIOR> 65,057,777
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,474,752)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 466,607
<NET-ASSETS> 78,093,109
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 5,247,243
<OTHER-INCOME> 0
<EXPENSES-NET> 470,658
<NET-INVESTMENT-INCOME> 4,776,585
<REALIZED-GAINS-CURRENT> (910,215)
<APPREC-INCREASE-CURRENT> (665,279)
<NET-CHANGE-FROM-OPS> 3,201,091
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4,776,585
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 17,660,443
<NUMBER-OF-SHARES-REDEEMED> 21,930,923
<SHARES-REINVESTED> 3,972,398
<NET-CHANGE-IN-ASSETS> (1,931,990)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 470,658
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 470,658
<AVERAGE-NET-ASSETS> 78,182,643
<PER-SHARE-NAV-BEGIN> 1.230
<PER-SHARE-NII> 0.075
<PER-SHARE-GAIN-APPREC> (0.024)
<PER-SHARE-DIVIDEND> (0.075)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.206
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC
<SERIES>
<NUMBER> 2
<NAME> MAXIM MONEY MARKET PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 400,427,645
<INVESTMENTS-AT-VALUE> 400,427,645
<RECEIVABLES> 351,104
<ASSETS-OTHER> 24,066
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 400,802,815
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4,349,627
<TOTAL-LIABILITIES> 4,349,627
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 396,453,188
<SHARES-COMMON-STOCK> 396,185,085
<SHARES-COMMON-PRIOR> 277,069,794
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 396,453,188
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 18,518,195
<OTHER-INCOME> 0
<EXPENSES-NET> 1,566,842
<NET-INVESTMENT-INCOME> 16,951,353
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 16,951,353
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 16,951,353
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 486,785,632
<NUMBER-OF-SHARES-REDEEMED> 384,610,230
<SHARES-REINVESTED> 16,939,889
<NET-CHANGE-IN-ASSETS> 119,195,899
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,566,842
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,566,842
<AVERAGE-NET-ASSETS> 344,707,526
<PER-SHARE-NAV-BEGIN> 1.001
<PER-SHARE-NII> 0.049
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (0.049)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.001
<EXPENSE-RATIO> 0.46
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 3
<NAME> MAXIM STOCK INDEX PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 597,078,465
<INVESTMENTS-AT-VALUE> 936,052,799
<RECEIVABLES> 2,079,766
<ASSETS-OTHER> 114,018
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 938,246,583
<PAYABLE-FOR-SECURITIES> 196,550
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,243,675
<TOTAL-LIABILITIES> 1,440,225
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 597,539,273
<SHARES-COMMON-STOCK> 396,116,761
<SHARES-COMMON-PRIOR> 357,369,279
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 292,751
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 338,974,334
<NET-ASSETS> 936,806,358
<DIVIDEND-INCOME> 17,361,945
<INTEREST-INCOME> 347,152
<OTHER-INCOME> 0
<EXPENSES-NET> 4,887,975
<NET-INVESTMENT-INCOME> 12,821,122
<REALIZED-GAINS-CURRENT> 4,440,335
<APPREC-INCREASE-CURRENT> 145,236,441
<NET-CHANGE-FROM-OPS> 162,497,898
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 12,821,122
<DISTRIBUTIONS-OF-GAINS> 4,147,584
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 136,295,020
<NUMBER-OF-SHARES-REDEEMED> 105,028,108
<SHARES-REINVESTED> 7,480,570
<NET-CHANGE-IN-ASSETS> 229,346,721
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 4,887,975
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,887,975
<AVERAGE-NET-ASSETS> 822,904,576
<PER-SHARE-NAV-BEGIN> 1.980
<PER-SHARE-NII> 0.034
<PER-SHARE-GAIN-APPREC> 0.396
<PER-SHARE-DIVIDEND> (0.034)
<PER-SHARE-DISTRIBUTIONS> (0.011)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 2.365
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 4
<NAME> MAXIM TOTAL RETURN PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 55,426,036
<INVESTMENTS-AT-VALUE> 64,418,538
<RECEIVABLES> 397,259
<ASSETS-OTHER> 12,480
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 64,828,277
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 167,473
<TOTAL-LIABILITIES> 167,473
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 55,517,126
<SHARES-COMMON-STOCK> 48,212,249
<SHARES-COMMON-PRIOR> 42,543,959
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 151,176
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 8,992,502
<NET-ASSETS> 64,660,804
<DIVIDEND-INCOME> 464,753
<INTEREST-INCOME> 1,584,546
<OTHER-INCOME> 0
<EXPENSES-NET> 364,049
<NET-INVESTMENT-INCOME> 1,685,250
<REALIZED-GAINS-CURRENT> 3,330,838
<APPREC-INCREASE-CURRENT> 1,763,008
<NET-CHANGE-FROM-OPS> 6,779,096
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,685,250
<DISTRIBUTIONS-OF-GAINS> 3,179,662
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 24,044,972
<NUMBER-OF-SHARES-REDEEMED> 21,972,635
<SHARES-REINVESTED> 3,595,953
<NET-CHANGE-IN-ASSETS> 9,484,776
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 364,049
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 364,049
<AVERAGE-NET-ASSETS> 61,081,097
<PER-SHARE-NAV-BEGIN> 1.297
<PER-SHARE-NII> 0.037
<PER-SHARE-GAIN-APPREC> 0.115
<PER-SHARE-DIVIDEND> (0.037)
<PER-SHARE-DISTRIBUTIONS> (0.070)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.341
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 5
<NAME> MAXIM US GOVERNMENT SECURITIES PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 67,806,551
<INVESTMENTS-AT-VALUE> 69,213,109
<RECEIVABLES> 428,386
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 69,641,495
<PAYABLE-FOR-SECURITIES> 5,529,434
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 34,198
<TOTAL-LIABILITIES> 5,563,632
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 65,567,825
<SHARES-COMMON-STOCK> 59,673,302
<SHARES-COMMON-PRIOR> 56,786,803
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 30,000
<ACCUMULATED-NET-GAINS> (2,866,520)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,406,558
<NET-ASSETS> 64,077,863
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 4,415,879
<OTHER-INCOME> 0
<EXPENSES-NET> 390,629
<NET-INVESTMENT-INCOME> 4,025,250
<REALIZED-GAINS-CURRENT> (205,044)
<APPREC-INCREASE-CURRENT> (1,345,799)
<NET-CHANGE-FROM-OPS> 2,474,407
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4,025,250
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 18,277,697
<NUMBER-OF-SHARES-REDEEMED> 19,150,378
<SHARES-REINVESTED> 3,759,180
<NET-CHANGE-IN-ASSETS> 1,603,904
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 30,000
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 390,629
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 390,629
<AVERAGE-NET-ASSETS> 64,930,523
<PER-SHARE-NAV-BEGIN> 1.100
<PER-SHARE-NII> 0.068
<PER-SHARE-GAIN-APPREC> (0.026)
<PER-SHARE-DIVIDEND> (0.068)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.074
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 6
<NAME> MAXIM CORPORATE BOND PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 78,304,546
<INVESTMENTS-AT-VALUE> 82,073,913
<RECEIVABLES> 1,651,489
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 83,725,402
<PAYABLE-FOR-SECURITIES> 15,683
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 64,690
<TOTAL-LIABILITIES> 80,373
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 79,461,495
<SHARES-COMMON-STOCK> 71,997,289
<SHARES-COMMON-PRIOR> 39,517,862
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 414,167
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,769,367
<NET-ASSETS> 83,645,029
<DIVIDEND-INCOME> 341,839
<INTEREST-INCOME> 5,149,929
<OTHER-INCOME> 0
<EXPENSES-NET> 574,728
<NET-INVESTMENT-INCOME> 4,917,040
<REALIZED-GAINS-CURRENT> 1,947,712
<APPREC-INCREASE-CURRENT> 209,063
<NET-CHANGE-FROM-OPS> 7,073,815
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4,917,040
<DISTRIBUTIONS-OF-GAINS> 1,533,545
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 56,150,349
<NUMBER-OF-SHARES-REDEEMED> 29,238,506
<SHARES-REINVESTED> 5,567,584
<NET-CHANGE-IN-ASSETS> 38,114,839
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 574,728
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 574,728
<AVERAGE-NET-ASSETS> 65,394,661
<PER-SHARE-NAV-BEGIN> 1.152
<PER-SHARE-NII> 0.083
<PER-SHARE-GAIN-APPREC> 0.032
<PER-SHARE-DIVIDEND> (0.083)
<PER-SHARE-DISTRIBUTIONS> (0.023)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.162
<EXPENSE-RATIO> 0.90
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 7
<NAME> MAXIM SMALL-CAP INDEX PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 70,670,934
<INVESTMENTS-AT-VALUE> 80,445,862
<RECEIVABLES> 355,406
<ASSETS-OTHER> 23,682
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 80,824,950
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 41,258
<TOTAL-LIABILITIES> 41,258
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 71,210,524
<SHARES-COMMON-STOCK> 65,307,537
<SHARES-COMMON-PRIOR> 44,187,988
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (201,760)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 9,774,928
<NET-ASSETS> 80,783,692
<DIVIDEND-INCOME> 1,069,433
<INTEREST-INCOME> 39,307
<OTHER-INCOME> 0
<EXPENSES-NET> 404,891
<NET-INVESTMENT-INCOME> 703,849
<REALIZED-GAINS-CURRENT> 5,633,401
<APPREC-INCREASE-CURRENT> 3,305,858
<NET-CHANGE-FROM-OPS> 9,643,108
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 703,849
<DISTRIBUTIONS-OF-GAINS> 5,835,161
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 40,270,869
<NUMBER-OF-SHARES-REDEEMED> 24,437,703
<SHARES-REINVESTED> 5,286,383
<NET-CHANGE-IN-ASSETS> 29,173,408
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 404,891
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 404,891
<AVERAGE-NET-ASSETS> 68,870,579
<PER-SHARE-NAV-BEGIN> 1.168
<PER-SHARE-NII> 0.012
<PER-SHARE-GAIN-APPREC> 0.166
<PER-SHARE-DIVIDEND> (0.012)
<PER-SHARE-DISTRIBUTIONS> (0.097)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.237
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 8
<NAME> MAXIM SMALL-CAP VALUE PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 31,192,086
<INVESTMENTS-AT-VALUE> 37,664,901
<RECEIVABLES> 167,851
<ASSETS-OTHER> 11,136
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 37,843,888
<PAYABLE-FOR-SECURITIES> 1,210,121
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 34,116
<TOTAL-LIABILITIES> 1,244,237
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 30,621,391
<SHARES-COMMON-STOCK> 29,326,200
<SHARES-COMMON-PRIOR> 19,467,399
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (494,555)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 6,472,815
<NET-ASSETS> 36,599,651
<DIVIDEND-INCOME> 497,727
<INTEREST-INCOME> 107,235
<OTHER-INCOME> 0
<EXPENSES-NET> 356,332
<NET-INVESTMENT-INCOME> 248,630
<REALIZED-GAINS-CURRENT> (494,555)
<APPREC-INCREASE-CURRENT> 5,489,537
<NET-CHANGE-FROM-OPS> 5,243,612
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 248,630
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 20,987,576
<NUMBER-OF-SHARES-REDEEMED> 11,342,266
<SHARES-REINVESTED> 213,491
<NET-CHANGE-IN-ASSETS> 15,830,072
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 274,316
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 388,879
<AVERAGE-NET-ASSETS> 28,225,413
<PER-SHARE-NAV-BEGIN> 1.067
<PER-SHARE-NII> 0.010
<PER-SHARE-GAIN-APPREC> 0.181
<PER-SHARE-DIVIDEND> (0.010)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.248
<EXPENSE-RATIO> 1.31
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 9
<NAME> MAXIM INTERNATIONAL EQUITY PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 82,040,703
<INVESTMENTS-AT-VALUE> 95,778,354
<RECEIVABLES> 345,283
<ASSETS-OTHER> 142,257
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 96,265,894
<PAYABLE-FOR-SECURITIES> 3,321
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 90,524
<TOTAL-LIABILITIES> 93,845
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 82,037,292
<SHARES-COMMON-STOCK> 72,696,970
<SHARES-COMMON-PRIOR> 48,280,296
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 397,106
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 13,737,651
<NET-ASSETS> 96,172,049
<DIVIDEND-INCOME> 1,653,805
<INTEREST-INCOME> 318,304
<OTHER-INCOME> 0
<EXPENSES-NET> 1,030,739
<NET-INVESTMENT-INCOME> 941,370
<REALIZED-GAINS-CURRENT> 2,178,997
<APPREC-INCREASE-CURRENT> 10,642,117
<NET-CHANGE-FROM-OPS> 13,762,484
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 941,370
<DISTRIBUTIONS-OF-GAINS> 1,781,891
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 40,579,183
<NUMBER-OF-SHARES-REDEEMED> 18,244,110
<SHARES-REINVESTED> 2,081,601
<NET-CHANGE-IN-ASSETS> 41,154,381
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 756,318
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,046,750
<AVERAGE-NET-ASSETS> 77,281,763
<PER-SHARE-NAV-BEGIN> 1.140
<PER-SHARE-NII> 0.014
<PER-SHARE-GAIN-APPREC> 0.209
<PER-SHARE-DIVIDEND> (0.014)
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.323
<EXPENSE-RATIO> 1.39
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 10
<NAME> MAXIM INVESCO ADR PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 7,027,695
<INVESTMENTS-AT-VALUE> 8,222,550
<RECEIVABLES> 8,012
<ASSETS-OTHER> 13,121
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 8,243,683
<PAYABLE-FOR-SECURITIES> 540,848
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 7,977
<TOTAL-LIABILITIES> 548,825
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 6,500,002
<SHARES-COMMON-STOCK> 5,696,363
<SHARES-COMMON-PRIOR> 2,382,982
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,194,855
<NET-ASSETS> 7,694,858
<DIVIDEND-INCOME> 98,970
<INTEREST-INCOME> 16,027
<OTHER-INCOME> 0
<EXPENSES-NET> 60,239
<NET-INVESTMENT-INCOME> 54,758
<REALIZED-GAINS-CURRENT> 22,587
<APPREC-INCREASE-CURRENT> 898,066
<NET-CHANGE-FROM-OPS> 975,411
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 54,758
<DISTRIBUTIONS-OF-GAINS> 7,284
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 4,000,572
<NUMBER-OF-SHARES-REDEEMED> 734,123
<SHARES-REINVESTED> 46,932
<NET-CHANGE-IN-ASSETS> 5,012,889
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (15,301)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 45,589
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 103,821
<AVERAGE-NET-ASSETS> 4,767,192
<PER-SHARE-NAV-BEGIN> 1.126
<PER-SHARE-NII> 0.011
<PER-SHARE-GAIN-APPREC> 0.227
<PER-SHARE-DIVIDEND> (0.011)
<PER-SHARE-DISTRIBUTIONS> (0.001)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.351
<EXPENSE-RATIO> 1.33
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 11
<NAME> MAXIM INVESCO BALANCED PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 15,629,110
<INVESTMENTS-AT-VALUE> 15,895,681
<RECEIVABLES> 92,899
<ASSETS-OTHER> 12,355
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 16,000,935
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 13,769
<TOTAL-LIABILITIES> 13,769
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 15,754,361
<SHARES-COMMON-STOCK> 15,360,820
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (33,766)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 266,571
<NET-ASSETS> 15,987,166
<DIVIDEND-INCOME> 24,079
<INTEREST-INCOME> 82,345
<OTHER-INCOME> 0
<EXPENSES-NET> 26,984
<NET-INVESTMENT-INCOME> 79,440
<REALIZED-GAINS-CURRENT> (15,106)
<APPREC-INCREASE-CURRENT> 266,571
<NET-CHANGE-FROM-OPS> 330,905
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 79,440
<DISTRIBUTIONS-OF-GAINS> 18,660
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 17,044,573
<NUMBER-OF-SHARES-REDEEMED> 1,777,818
<SHARES-REINVESTED> 94,065
<NET-CHANGE-IN-ASSETS> 15,987,166
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 26,984
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 26,984
<AVERAGE-NET-ASSETS> 11,188,461
<PER-SHARE-NAV-BEGIN> 1.000
<PER-SHARE-NII> 0.005
<PER-SHARE-GAIN-APPREC> 0.042
<PER-SHARE-DIVIDEND> (0.005)
<PER-SHARE-DISTRIBUTIONS> (0.001)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.041
<EXPENSE-RATIO> 1.00
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 12
<NAME> MAXIM INVESCO SMALL-CAP GROWTH PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 32,263,774
<INVESTMENTS-AT-VALUE> 32,145,692
<RECEIVABLES> 78,564
<ASSETS-OTHER> 11,182
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 32,235,438
<PAYABLE-FOR-SECURITIES> 377,870
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 29,790
<TOTAL-LIABILITIES> 407,660
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 32,003,439
<SHARES-COMMON-STOCK> 22,210,373
<SHARES-COMMON-PRIOR> 5,014,369
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (57,579)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (118,082)
<NET-ASSETS> 31,827,778
<DIVIDEND-INCOME> 16,307
<INTEREST-INCOME> 236,573
<OTHER-INCOME> 0
<EXPENSES-NET> 206,106
<NET-INVESTMENT-INCOME> 46,774
<REALIZED-GAINS-CURRENT> 3,460,487
<APPREC-INCREASE-CURRENT> (898,623)
<NET-CHANGE-FROM-OPS> 2,608,638
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 46,774
<DISTRIBUTIONS-OF-GAINS> 3,518,066
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 23,449,006
<NUMBER-OF-SHARES-REDEEMED> 8,740,654
<SHARES-REINVESTED> 2,487,652
<NET-CHANGE-IN-ASSETS> 25,442,598
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 178,001
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 274,831
<AVERAGE-NET-ASSETS> 19,815,858
<PER-SHARE-NAV-BEGIN> 1.273
<PER-SHARE-NII> 0.002
<PER-SHARE-GAIN-APPREC> 0.338
<PER-SHARE-DIVIDEND> (0.002)
<PER-SHARE-DISTRIBUTIONS> (0.178)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.433
<EXPENSE-RATIO> 1.10
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 13
<NAME> MAXIM MID-CAP PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 185,907,917
<INVESTMENTS-AT-VALUE> 218,330,551
<RECEIVABLES> 2,882,130
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 221,212,681
<PAYABLE-FOR-SECURITIES> 5,623,583
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 878,295
<TOTAL-LIABILITIES> 6,501,878
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 181,771,175
<SHARES-COMMON-STOCK> 149,869,643
<SHARES-COMMON-PRIOR> 109,512,924
<ACCUMULATED-NII-CURRENT> (1,245,198)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 2,451,057
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 31,733,769
<NET-ASSETS> 214,710,803
<DIVIDEND-INCOME> 297,903
<INTEREST-INCOME> 466,960
<OTHER-INCOME> 0
<EXPENSES-NET> 2,010,061
<NET-INVESTMENT-INCOME> (1,245,198)
<REALIZED-GAINS-CURRENT> 2,726,920
<APPREC-INCREASE-CURRENT> 6,891,777
<NET-CHANGE-FROM-OPS> 8,373,499
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 275,863
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 61,466,234
<NUMBER-OF-SHARES-REDEEMED> 21,306,676
<SHARES-REINVESTED> 197,161
<NET-CHANGE-IN-ASSETS> 66,446,609
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,794,155
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,026,331
<AVERAGE-NET-ASSETS> 191,376,279
<PER-SHARE-NAV-BEGIN> 1.354
<PER-SHARE-NII> (0.008)
<PER-SHARE-GAIN-APPREC> 0.089
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.002)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.433
<EXPENSE-RATIO> 1.07
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 14
<NAME> MAXIM T. ROWE PRICE EQUITY/INCOME PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 64,481,457
<INVESTMENTS-AT-VALUE> 70,120,361
<RECEIVABLES> 482,356
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 70,602,717
<PAYABLE-FOR-SECURITIES> 1,010,172
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 56,642
<TOTAL-LIABILITIES> 1,066,814
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 63,898,024
<SHARES-COMMON-STOCK> 47,983,856
<SHARES-COMMON-PRIOR> 8,668,162
<ACCUMULATED-NII-CURRENT> (1,025)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 5,638,904
<NET-ASSETS> 69,535,903
<DIVIDEND-INCOME> 919,410
<INTEREST-INCOME> 311,350
<OTHER-INCOME> 0
<EXPENSES-NET> 306,028
<NET-INVESTMENT-INCOME> 924,732
<REALIZED-GAINS-CURRENT> 1,260,911
<APPREC-INCREASE-CURRENT> 4,289,133
<NET-CHANGE-FROM-OPS> 6,474,776
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 924,732
<DISTRIBUTIONS-OF-GAINS> 1,261,936
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 44,968,105
<NUMBER-OF-SHARES-REDEEMED> 7,179,849
<SHARES-REINVESTED> 1,527,438
<NET-CHANGE-IN-ASSETS> 58,585,708
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 257,708
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 387,401
<AVERAGE-NET-ASSETS> 33,984,353
<PER-SHARE-NAV-BEGIN> 1.263
<PER-SHARE-NII> 0.030
<PER-SHARE-GAIN-APPREC> 0.213
<PER-SHARE-DIVIDEND> (0.030)
<PER-SHARE-DISTRIBUTIONS> (0.027)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.449
<EXPENSE-RATIO> 0.95
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 15
<NAME> MAXIM FOREIGN EQUITY PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 73,747,756
<INVESTMENTS-AT-VALUE> 79,644,959
<RECEIVABLES> 294,686
<ASSETS-OTHER> 251,789
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 80,191,434
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 84,975
<TOTAL-LIABILITIES> 84,975
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 74,425,363
<SHARES-COMMON-STOCK> 75,718,452
<SHARES-COMMON-PRIOR> 65,244,412
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 395,257
<ACCUMULATED-NET-GAINS> 179,150
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 5,897,203
<NET-ASSETS> 80,106,459
<DIVIDEND-INCOME> 1,195,658
<INTEREST-INCOME> 127,750
<OTHER-INCOME> 0
<EXPENSES-NET> 1,029,873
<NET-INVESTMENT-INCOME> 293,535
<REALIZED-GAINS-CURRENT> 3,406,860
<APPREC-INCREASE-CURRENT> 1,485,414
<NET-CHANGE-FROM-OPS> 5,185,809
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 293,535
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 45,789,651
<NUMBER-OF-SHARES-REDEEMED> 35,600,077
<SHARES-REINVESTED> 284,466
<NET-CHANGE-IN-ASSETS> 15,702,591
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (3,227,710)
<OVERDISTRIB-NII-PRIOR> 395,257
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 711,998
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,034,104
<AVERAGE-NET-ASSETS> 71,948,638
<PER-SHARE-NAV-BEGIN> 0.987
<PER-SHARE-NII> 0.004
<PER-SHARE-GAIN-APPREC> 0.071
<PER-SHARE-DIVIDEND> (0.004)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.058
<EXPENSE-RATIO> 1.45
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 16
<NAME> MAXIM GROWTH INDEX PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 72,586,976
<INVESTMENTS-AT-VALUE> 84,793,169
<RECEIVABLES> 337,432
<ASSETS-OTHER> 1,426
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 85,132,027
<PAYABLE-FOR-SECURITIES> 1,345,166
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 43,651
<TOTAL-LIABILITIES> 1,388,817
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 71,755,347
<SHARES-COMMON-STOCK> 56,383,608
<SHARES-COMMON-PRIOR> 32,332,633
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (218,330)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 12,206,193
<NET-ASSETS> 83,743,210
<DIVIDEND-INCOME> 838,053
<INTEREST-INCOME> 47,650
<OTHER-INCOME> 0
<EXPENSES-NET> 371,758
<NET-INVESTMENT-INCOME> 513,945
<REALIZED-GAINS-CURRENT> 7,245,844
<APPREC-INCREASE-CURRENT> 4,368,100
<NET-CHANGE-FROM-OPS> 12,127,889
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 513,945
<DISTRIBUTIONS-OF-GAINS> 7,464,174
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 47,802,158
<NUMBER-OF-SHARES-REDEEMED> 29,126,291
<SHARES-REINVESTED> 5,375,108
<NET-CHANGE-IN-ASSETS> 40,227,911
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 371,758
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 371,758
<AVERAGE-NET-ASSETS> 63,523,526
<PER-SHARE-NAV-BEGIN> 1.346
<PER-SHARE-NII> 0.011
<PER-SHARE-GAIN-APPREC> 0.285
<PER-SHARE-DIVIDEND> (0.011)
<PER-SHARE-DISTRIBUTIONS> (0.146)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.485
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 17
<NAME> MAXIM INVESTMENT GRADE CORPORATE BOND PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 98,333,268
<INVESTMENTS-AT-VALUE> 98,980,880
<RECEIVABLES> 2,021,412
<ASSETS-OTHER> 12,758
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 101,015,050
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 292,898
<TOTAL-LIABILITIES> 292,898
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 101,233,059
<SHARES-COMMON-STOCK> 78,850,360
<SHARES-COMMON-PRIOR> 72,344,313
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,158,519)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 647,612
<NET-ASSETS> 100,722,152
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 6,415,479
<OTHER-INCOME> 0
<EXPENSES-NET> 575,853
<NET-INVESTMENT-INCOME> 5,839,626
<REALIZED-GAINS-CURRENT> (1,158,519)
<APPREC-INCREASE-CURRENT> (1,637,586)
<NET-CHANGE-FROM-OPS> 3,043,521
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 5,839,626
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 40,128,086
<NUMBER-OF-SHARES-REDEEMED> 38,210,297
<SHARES-REINVESTED> 4,588,258
<NET-CHANGE-IN-ASSETS> 5,511,748
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 575,853
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 575,853
<AVERAGE-NET-ASSETS> 96,182,959
<PER-SHARE-NAV-BEGIN> 1.316
<PER-SHARE-NII> 0.078
<PER-SHARE-GAIN-APPREC> (0.039)
<PER-SHARE-DIVIDEND> (0.078)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.277
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 18
<NAME> MAXIM SHORT TERM MATURITY BOND PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 38,718,999
<INVESTMENTS-AT-VALUE> 38,860,470
<RECEIVABLES> 652,280
<ASSETS-OTHER> 10,828
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 39,523,578
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 20,464
<TOTAL-LIABILITIES> 20,464
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 39,421,722
<SHARES-COMMON-STOCK> 39,248,881
<SHARES-COMMON-PRIOR> 15,476,607
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (60,079)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 141,471
<NET-ASSETS> 39,503,114
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,729,701
<OTHER-INCOME> 0
<EXPENSES-NET> 179,920
<NET-INVESTMENT-INCOME> 1,549,781
<REALIZED-GAINS-CURRENT> (60,079)
<APPREC-INCREASE-CURRENT> 53,675
<NET-CHANGE-FROM-OPS> 1,543,377
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,549,781
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 51,768,539
<NUMBER-OF-SHARES-REDEEMED> 29,542,541
<SHARES-REINVESTED> 1,546,276
<NET-CHANGE-IN-ASSETS> 23,884,444
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 179,920
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 179,920
<AVERAGE-NET-ASSETS> 30,981,951
<PER-SHARE-NAV-BEGIN> 1.009
<PER-SHARE-NII> 0.049
<PER-SHARE-GAIN-APPREC> (0.003)
<PER-SHARE-DIVIDEND> (0.049)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.007
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 19
<NAME> MAXIM SMALL-CAP AGGRESSIVE GROWTH PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 69,691,541
<INVESTMENTS-AT-VALUE> 79,551,350
<RECEIVABLES> 712,202
<ASSETS-OTHER> 15,431
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 80,278,983
<PAYABLE-FOR-SECURITIES> 264,253
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 69,804
<TOTAL-LIABILITIES> 334,057
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 69,471,833
<SHARES-COMMON-STOCK> 56,990,464
<SHARES-COMMON-PRIOR> 24,639,748
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 21,665
<ACCUMULATED-NET-GAINS> 634,949
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 9,859,809
<NET-ASSETS> 79,944,926
<DIVIDEND-INCOME> 644,309
<INTEREST-INCOME> 397,141
<OTHER-INCOME> 0
<EXPENSES-NET> 577,497
<NET-INVESTMENT-INCOME> 463,953
<REALIZED-GAINS-CURRENT> 5,613,801
<APPREC-INCREASE-CURRENT> 6,998,120
<NET-CHANGE-FROM-OPS> 13,075,874
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 463,953
<DISTRIBUTIONS-OF-GAINS> 4,978,852
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 48,298,315
<NUMBER-OF-SHARES-REDEEMED> 19,892,161
<SHARES-REINVESTED> 3,944,562
<NET-CHANGE-IN-ASSETS> 51,350,315
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 21,665
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 469,293
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 581,204
<AVERAGE-NET-ASSETS> 49,329,542
<PER-SHARE-NAV-BEGIN> 1.161
<PER-SHARE-NII> 0.009
<PER-SHARE-GAIN-APPREC> 0.338
<PER-SHARE-DIVIDEND> (0.009)
<PER-SHARE-DISTRIBUTIONS> (0.095)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.403
<EXPENSE-RATIO> 1.26
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 20
<NAME> MAXIM GOVERNMENT MORTGAGE SECURITIES PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 153,909,364
<INVESTMENTS-AT-VALUE> 156,264,923
<RECEIVABLES> 879,217
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 157,144,140
<PAYABLE-FOR-SECURITIES> 18,437,718
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 240,514
<TOTAL-LIABILITIES> 18,678,232
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 139,851,238
<SHARES-COMMON-STOCK> 120,204,859
<SHARES-COMMON-PRIOR> 109,916,946
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (3,740,889)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,355,559
<NET-ASSETS> 138,465,908
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 9,387,266
<OTHER-INCOME> 0
<EXPENSES-NET> 791,813
<NET-INVESTMENT-INCOME> 8,595,453
<REALIZED-GAINS-CURRENT> (190,132)
<APPREC-INCREASE-CURRENT> (2,751,951)
<NET-CHANGE-FROM-OPS> 5,653,370
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 8,595,453
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 60,620,445
<NUMBER-OF-SHARES-REDEEMED> 57,812,180
<SHARES-REINVESTED> 7,479,648
<NET-CHANGE-IN-ASSETS> 8,916,228
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (3,550,757)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 791,813
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 791,813
<AVERAGE-NET-ASSETS> 132,339,606
<PER-SHARE-NAV-BEGIN> 1.179
<PER-SHARE-NII> 0.075
<PER-SHARE-GAIN-APPREC> (0.027)
<PER-SHARE-DIVIDEND> (0.075)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.152
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000356476
<NAME> MAXIM SERIES FUND, INC.
<SERIES>
<NUMBER> 21
<NAME> MAXIM VALUE INDEX PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 98,650,371
<INVESTMENTS-AT-VALUE> 121,856,300
<RECEIVABLES> 457,481
<ASSETS-OTHER> 32,499
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 122,346,280
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 63,254
<TOTAL-LIABILITIES> 63,254
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 99,075,119
<SHARES-COMMON-STOCK> 84,114,226
<SHARES-COMMON-PRIOR> 51,641,022
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,978
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 23,205,929
<NET-ASSETS> 122,283,026
<DIVIDEND-INCOME> 2,682,582
<INTEREST-INCOME> 63,998
<OTHER-INCOME> 0
<EXPENSES-NET> 552,296
<NET-INVESTMENT-INCOME> 2,194,284
<REALIZED-GAINS-CURRENT> 3,001,707
<APPREC-INCREASE-CURRENT> 12,970,042
<NET-CHANGE-FROM-OPS> 18,166,033
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 2,194,284
<DISTRIBUTIONS-OF-GAINS> 2,999,729
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 59,397,860
<NUMBER-OF-SHARES-REDEEMED> 30,534,066
<SHARES-REINVESTED> 3,609,410
<NET-CHANGE-IN-ASSETS> 57,099,128
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 552,296
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 552,296
<AVERAGE-NET-ASSETS> 94,348,693
<PER-SHARE-NAV-BEGIN> 1.262
<PER-SHARE-NII> 0.030
<PER-SHARE-GAIN-APPREC> 0.229
<PER-SHARE-DIVIDEND> (0.030)
<PER-SHARE-DISTRIBUTIONS> (0.037)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.454
<EXPENSE-RATIO> 0.60
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
