Dear Shareholders:
The financial markets have been exceptionally volatile over the past few
weeks. Events began to unfold in mid August, when the Asian currency crisis bled
over to the Far East markets causing those markets to stumble, setting off a
domino-effect that spread to all world markets. Just as market observers were
predicting a repeat of the October 19, 1987 slide, stocks rallied back. At
Calvert Group, we see this recent roller coaster ride as an example of the ups
and downs inevitable in stock market investing. We don't believe the skies have
suddenly darkened over the entire market. Fundamentals are still strong. There
is no evidence of surging inflation, the economy is expanding at a sustainable
pace and money continues to flow into the market.
For investors troubled by the recent volatility, we suggest two time-tested
approaches. First, make investment decisions based on your time horizon and
tolerance for risk. Second, diversifying among different types of asset classes
can help lessen the sting of a sudden fall in stock prices. Your financial
professional can help you decide whether your portfolio is well balanced. In
closing, I'd like to call your attention to the new format of our shareholder
reports. The changes were intended to put you in closer contact with the
portfolio manager and make the reports more interesting to read. We welcome your
comments.
Sincerely,
Barbara J. Krumsiek
President and CEO
November 3, 1997
Dear Investors:
The financial markets have continued to be good to investors over the
past period. Your Fund's returns have kept up with their respective
indices. Many of us, including Alan Greenspan and noted investor
Warren Buffet, are baffled by the strong gains. Yet, some people talk
about a New Era of Investing Economics and expect prices to continue
to climb.
Well, New Eras bring New Challenges. For example, Microsoft, a stock
the Managed Growth Portfolio has held to great profit, provides a new
case study of what it means to be a dominant economic player for the
personal choices we the people may have, or not have, in the future.
While we as shareholders are able to enjoy the strong financial
returns that come as a result of the software developer's success,
it's hard not to feel a slight sense of misgiving. The company
satisfies all of our traditional investment criteria, and even excels
in the area of personnel practices, yet we have to ask whether our
society, or even Microsoft, is better off when one entity dominates
the creation and development of new information technologies. We
recognize the value of biodiversity in the environment, but what
about the hazards of a monoculture in our information world?
Department of Labor
sweatshop event
On September 22, 1997, Calvert Group organized and led a press
conference with members of the social investment community. The
event, hosted by Secretary of Labor Alexis Herman, applauded the
Apparel Industry Partnership (AIP) for their efforts in developing
meaningful solutions to sweatshop practices. The event was also
intended to encourage more companies to join the Partnership. Several
reporters from prominent news and media organizations were present at
the briefing. A joint statement was endorsed by Calvert Group and
numerous other social investment industry leaders.
The Journal of Investing
Finally, I want to call your attention to the Journal of Investing's
winter issue, which focuses almost entirely on socially responsible
investing. The publication is noteworthy not only because it contains
two articles from Calvert Group, but because this is the first time a
mainstream financial journal has recognized our field in such a
serious and comprehensive way.
As our fund reaches its fifteenth year, it is
this kind of recognition that will help deepen the awareness,
penetration and impact of our investment philosophy.
Sincerely,
D. Wayne Silby
Chairman, Board of Trustees
October 21, 1997
<PAGE>
A DISCUSSION WITH PORTFOLIO MANAGER,
Beth Bunnell Hunter
What was the investment climate over the period covered by this
report?
Investors have had difficulty getting a clear reading on the strength
of the economy or the direction of interest rates, so money market
yields have traded in a fairly tight band. The one-year Treasury Bill
was yielding about 5.69% at the beginning of the period, peaked at 6%
the end of April, then fell back to close the period at 5.45%.
Federal Reserve Chairman Alan Greenspan expressed concern about the
pace of economic growth, but the Fed maintained its neutral monetary
policy. In March, the Fed made only one change to its target for key
rates, a 25 basis points increase to the federal funds rate, the rate
banks charge each other for overnight loans.
What was your strategy?
Expecting that money market rates would be more likely to rise than
fall, we kept the Portfolio's maturity near the short end of its
one-year range throughout the year. The weighted average maturity was
23 days at the close of this period, compared to 28 days at the start.
To enhance yields without taking significantly greater market risk,
we shifted to a barbelled maturity structure, concentrating assets
both at the short and long end of the money market spectrum. At the
short end, we continued to invest heavily in variable rate demand
notes. These securities typically yield 15 to 20 basis points more
than comparable corporate issues. Variable rate demand notes
comprised about 65% of the total Portfolio on September 30, 1997, up
from about 53% one year ago. On the long end, we've added to our
holdings of government agency issues and CDs.
Can you comment on the Portfolio's relative performance?
The Portfolio's yield has remained near the average money market fund
yield over the past year.
Where do you see short-term rates heading over the next six months?
The Fed's next move is more likely to be another modest rate
increase, which should cause short-term yields to rise a bit.
However, money market investors shouldn't expect dramatically higher
yields.
October 20, 1997
Money Market Portfolio Statistics
September 30, 1997
Annualized Dividend Yield
6 Months ended
9/30/97 3/31/97
Money
Market Portfolio 4.98% 4.81%
Lipper Money
Market Funds Index 4.71% 4.60%
Maturity Schedule
Weighted Average
9/30/97 3/31/97
23 days 33 days
Portfolio Quality Structure
Pie chart here showing percentage of each portfolio:
Tier 1 88%
US Government Agency 12%
All securities in Calvert Group money market funds are eligible securities
under rule 2a-7 of the Investment Company Act of 1940. First Tier Securities are
eligible securities rated in the highest rating category for short-term debt
obligations by at least two of the Nationally Recognized Statistical Rating
Organizations. Second Tier Securities are eligible securities not in the First
Tier. Total return assumes reinvestment of dividends. Past performance is no
guarantee of future results.
<PAGE>
A DISCUSSION WITH PORTFOLIO MANAGER,
Greg Habeeb
What was your view of the strength of the economy and the investment
climate over the past 12 months?
The economy looked to be expanding at a robust but not runaway pace. The
most obvious indicators of rising prices-the consumer price index and producer
price index-have not pointed to surging inflation. But there was a steady
increase in new job hires and shrinking unemployment. Tight labor markets
typically push wages higher which can trigger higher prices at the consumer
level. Bond yields traded in a fairly tight range. The high and low yields on
the benchmark 30-year Treasury bond were within 95 basis points of each other
for the year, with a high of 7.20% and a low of 6.25%. What was your strategy?
We kept the Portfolio's duration, a measure of interest rate
sensitivity, near the short end of our range through the first half
of this reporting period. Going into the second half, we lengthened
duration a bit in order to capture more yield. This less cautious
stance is in line with our generally favorable outlook for the bond
market.
Once we hit our target duration, we tend to stay there. Instead of trying
to predict the direction of rates day-to-day or week-to-week, we look to enhance
returns by implementing relative value trades. That is, we purchase undervalued
issues and sell them when they return to fair value We were successful with that
approach during this period, finding trading opportunities among corporate
bonds. We further reduced our holdings of mortgage-backed securities because
they seemed overvalued. How did the Portfolio's return compare to that of its
benchmark? For the 12-month period, we led the Lehman Aggregate Bond Index by 18
basis points. For the six-month period, we led the Index by 38 basis points.
What's your prediction for the economy and interest rates over the
next six months and beyond?
The Federal Reserve is determined not to get behind the curve with
inflation and may take steps to nudge key short-term rates higher in
the coming months. Long rates would likely follow suit. However, we
don't expect any steep increases in the notes that the Fed controls.
Looking out over the next year, we see a number of trends that
portend lower rates. These include a secular downtrend in inflation
over the last three years, fundamental changes in US fiscal policy
and a strong US economy that has practically eliminated the need for
net new Treasury borrowings. Thus our long-term outlook for the bond
market for the next year is positive.
October 20, 1997
Bond
Portfolio Statistics
September 30, 1997
Investment Performance
6 Months 12 Months
Bond Portfolio 7.50% 9.89%
Lehman Aggregate
Bond Index TR 7.12% 9.71%
Lipper Corporate
Debt A Funds Index 7.38% 9.89%
Maturity Schedule
Weighted Average
9/30/97 3/31/97
14 years 11 years
SEC Yields
30 days ended
9/30/97 3/31/97
4.77% 5.44%
<PAGE>
Portfolio Quality Structure
Pie chart here showing percentage of each bond:
AA 2%
AAA 25%
BB 2%
BBB 31%
A 44%
Cash Eqivalent 7%
Investment performance does not reflect the deduction of any
front-end sales charge.
TR represents total return
Source: Lipper Analytical Services, Inc.
<PAGE>
BOND
PORTFOLIO STATISTICS
September 30, 1997
Average Annual Total Returns
as of 9/30/97
One year 5.74%
Five year 5.50%
Ten year 8.44%
Since inception 8.24%
(8/24/87)
Performance Comparison
Comparison of change in value of $10,000 investment.
Line graph here showing comparison from 10//1/87 to 9/97
CSIF Bond Portfolio - $22,490
Lehman Aggregate Bond Index TR - $24,731
Total returns assume reinvestment of dividends and reflect the deduction of
the Fund's maximum sales charge of 3.75%. No sales charge has been applied to
the index used for comparison. Past performance is no guarantee of future
results.
<PAGE>
A DISCUSSION WITH VICE PRESIDENT
OF EQUITIES, JOHN NICHOLS
Could you summarize the performance of the financial markets over the
past year?
Stocks continued to charge ahead, with small- and mid-cap securities
lagging the first three quarters then leading the pack in the final
quarter. Bonds posted positive, but not quite as spectacular gains.
What changes were made in the Portfolio's fixed-income strategy?
Calvert Asset Management Company, Inc. kept the Portfolio's duration,
a measure of interest rate sensitivity, near the short end of the
range through the first half of this reporting period. Going into the
second half, they lengthened duration a bit in order to capture more
yield. This slightly less cautious stance is in line with their
generally favorable outlook for the bond market.
Two other asset managers oversee the Portfolio's equity component.
Can you tell us how assets were managed by those firms?
Brown Capital Management, Inc. uses a Growth at a Reasonable Price
(GARP) approach, whereby they look to identify companies with
above-average growth potential that are also trading at attractive
prices. For the past year, they have focused on companies that stand
to benefit from two key themes: corporations and businesses looking
to enhance productivity and businesses catering to the aging
population. That's led them to stocks in the health care, financial
services and technology industries. They are also weighted toward
mid-cap companies, not the big, well-known companies that comprise the
Dow Jones Industrials Average or the Standard & Poor's 500 Stock
Index.
NCM Capital Management, Inc. also utilizes a GARP strategy. Their
portion of the Portfolio is fully diversified among large and small
companies, across industries and among cyclical and non-cyclical
businesses. During this period, they tended to focus on
multi-national, consumer growth companies-the big corporate
powerhouses they expect will benefit from globalization of the
world's markets-and companies in the financial services and technology
industries.
How did the Fund perform?
Investors earned double-digit returns over both the six- and 12-month
periods. Both asset categories and all three fund managers
contributed positive gains. The Portfolio's return was modestly above
the return on the Lipper Balanced Funds Index for the six-month
period and slightly behind for the one year period. This was largely
due to a turn-around in the small- and mid-cap stock universe. The
Portfolio's mid-cap component is larger than most of its peers, so we
lagged in the first part of this reporting period when mid-caps were
outdistanced by large-caps then led in the latter part when this
sector soared.
Going forward, what should investors expect from the financial
markets?
Near-term, the stock and bond markets will likely exhibit a high
degree of volatility as investors await the next Federal Reserve
meeting. We are not anticipating a steep increase in rates, although
the Fed may take some action to keep inflation in check.
Relatively stable interest rates should allow bonds to generate
positive returns in 1998. Stocks are not likely to expand as much as
they have in the past few years, but the market's foundation looks
solid. Portfolio managers' ability to select stocks will likely be
the key to continued good performance.
October 20, 1997
Managed Growth Portfolio Statistics
September 30, 1997
Ten Largest Holdings
% of Net Assets
Xerox Capital Trust I,
8.00%, 2/1/27 2.39%
Swedbank Sparbank Svenge,
7.50%, 9/1/12 2.05%
Medpartners, Inc.,
6.875%, 9/1/00 1.75%
Cisco Systems, Inc. 1.66%
Greentree Financial Corp. 1.57%
Chase Manhattan Corp. 1.51%
Cardinal Health, Inc. 1.35%
Oracle Systems Corp. 1.33%
Repurchase Agreement 1.29%
EMC Corp. 1.25%
Total 16.15%
Investment Performance
6 Months 12 Months
Managed
Growth Portfolio 19.77% 21.94%
Lehman Aggregate
Bond Index TR 7.12% 9.71%
S&P 500 Index
Mthly. Reinvested 26.24% 40.43%
Lipper Balanced
Funds Index 17.82% 24.92%
Investment performance is for Class A shares and does not reflect the
deduction of any front-end sales charge.
Source: Lipper Analytical Services,Inc.
New subadvisors assumed management of the Portfolio effective July
1995.
<PAGE>
MANAGED GROWTH PORTFOLIO STATISTICS
September 30, 1997
Average Annual Total Returns
Class A Shares
as of 9/30/97
One year 16.30%
Five year 9.91%
Ten year 8.78%
Since inception 11.54%
(10/21/82)
Class C Shares
as of 9/30/97
One year 20.56%
Since inception 11.22%
(3/01/94)
Performance Comparison
Comparison of change in value of $10,000 investment.
Line chart here showing comparison from 10/1/87 to 9/97
CSIF Managed Growth Portfolio - $23,191
S&P 500 Index Monthly Reinvested - $39,502
Lehman Aggregate Bond Index TR - $24,731
Lipper Balanced Fund Index - $28,897
90 day T-Bill - $17,138
Total returns assume reinvestment of dividends and reflect the deduction
of the Fund's maximum sales charge of 4.75%. No sales charge has been applied to
the index used for comparison. Past performance is no guarantee of future
results. The value of an investment in Class A shares is plotted in the line
graph.The value of an investment in Class C shares would be different.
<PAGE>
A DISCUSSION WITH PORTFOLIO MANAGER, PHIL SCHETTEWI
How would you characterize the investment climate for stocks over the
past 12 months?
This has been an exceptional period, brought about by a powerful
combination of strong earnings growth, continued low inflation,
relatively stable interest rates and solid demand for stocks. In
general, the best returns came from stocks in the technology,
financial services and transportation sectors. Health care companies,
utilities and manufacturers of basic materials tended to post weaker
returns.
What is Loomis, Sayles and Company's management strategy?
Our analysis leads us to stocks of companies with improving
fundamentals that are selling at the low end of their historical
valuation range. We then look for evidence of a change occurring at
the company or industry level, something that will serve as a
catalyst for greater earnings growth or higher valuations.
How did the Portfolio perform over the past 12 months?
While strongly positive, the Portfolio's 12-month return lagged the
return for the Lipper Growth Funds Index.
The Portfolio was hurt by our relative underweighting in the
financial services sector and exposure to specific companies that
experienced setbacks. For instance, shares of technology services
company Ikon Office Solutions declined in value when the company
encountered difficulty bringing about a change in its organizational
structure. Investors also punished networking company Ascend
Communications for product delivery problems and weak international
demand.
On the positive side, Intel, the dominant manufacturer of PC chips
and one of the Portfolio's largest holdings, contributed strong
gains. US Freightways also boosted returns.
What should investors expect over the next six months?
The current environment is favorable for stocks, and we don't
anticipate radical change. The economy is expanding at a modest pace,
which should keep corporate earnings from declining and may indeed
encourage further growth. Inflation appears benign, with only slight
price increases measured at the producer and consumer levels. We
expect any intervention by the Federal Reserve would be minimal and
would not bring the current economic expansion to a halt. However,
with valuations moving higher, stock selection becomes more critical.
We believe our active, bottom-up approach should help us outperform
broad market measures over the coming months.
October 20, 1997
Equity
Portfolio Statistics
September 30, 1997
Ten Largest Stock Holdings
% of Net Assets
SBC Communications, Inc. 3.88%
Intel Corp. 3.73%
Federated Department Stores, Inc. 3.38%
Computer Associates
International, Inc. 3.37%
United Meridian Corp. 3.17%
Dover Corp. 3.12%
American Greetings Corp. 3.00%
General Nutrition
Companies, Inc. 2.85%
International Business
Machines Corp. 2.77%
Nalco Chemical Co. 2.76%
Total 32.03%
Investment Performance
6 Months 12 Months
Equity Portfolio 24.54% 31.34%
S&P 500 Index
Mthly. Reinvested 26.24% 40.43%
Lipper Growth
Funds Index 27.66% 34.61%
Investment performance is for Class A shares and does not reflect the
deduction of any front-end sales charge.
Source: Lipper Analytical Services,Inc.
New subadvisors assumed management of the Portfolio effective February
1994.
<PAGE>
EQUITY
PORTFOLIO STATISTICS
September 30, 1997
Average Annual Total Returns
Class A Shares
as of 9/30/97
One year 25.07%
Five year 11.08%
Ten year 9.13%
Since inception 9.25%
(8/24/87)
Class C Shares
as of 9/30/97
One year 29.84%
Since inception 11.89%
(3/01/94)
Performance Comparison
Comparison of change in value of $10,000 investment.
Line graph here showing comparison from 10/1/87 to 9/97
CSIF Equity Portfolio - $23,957
S&P 500 Index Montly Reinvested - $39,502
Lipper Growth Funds Index - $25,060
Total returns assume reinvestment of dividends and reflect the deduction of
the Fund's maximum sales charge of 4.75%. No sales charge has been applied to
the index used for comparison. Past performance is no guarantee of future
results.The value of an investment in Class A shares is plotted in the line
graph. The value of an investment in Class C shares would be different.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees and Shareholders of Calvert Social Investment
Fund: We have audited the accompanying statements of net assets of Calvert
Social Investment Fund (comprised of the Money Market, Managed Growth, Bond and
Equity Portfolios), as of September 30, 1997, the related statements of
operations for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended, and financial highlights for
each of the four years in the period then ended. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits. The financial highlights for the year
ended September 30, 1993, were audited by other auditors whose report dated
October 29, 1993, expressed an unqualified opinion thereon. We conducted our
audits in accordance with generally accepted auditing standards. Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements and financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of investments owned as of September 30, 1997, by correspondence
with the custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion. In our opinion, the financial
statements and financial highlights referred to above present fairly, in all
material respects, the financial position of the respective portfolios
comprising Calvert Social Investment Fund as of September 30, 1997, and the
results of their operations for the year then ended, the changes in their net
assets for each of the two years in the period then ended and financial
highlights for each of the four years in the period then ended, in conformity
with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Baltimore, Maryland
November 7, 1997
<PAGE>
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
SEPTEMBER 30, 1997
U.S. Government Agencies Principal
and Instrumentalities (6.0%) Amount
Federal National Mortgage Assn., 5.33%, 10/16/97 $5,000,000
Student Loan Marketing Assn, 5.79%, 9/16/98 5,000,000
Total U.S. Government Agencies and
Instrumentalities (Cost $9,991,163)
Certificates of Deposit (0.7%)
Bank of Cherokee County, 5.50%, 4/22/98 (^) 100,000
Broadway Federal Savings & Loan, 5.20%,
8/20/98 (^) 100,000
Community Bank of the Bay, 5.50%, 10/7/97 (^) 100,000
Community Capital Bank, 5.05%, 1/20/98 (^) 100,000
Elk Horn Bank & Trust, 5.27%, 12/18/97 (^) 100,000
Family Savings Bank, 5.40%, 8/20/98 (^) 100,000
First Community Bank, 5.10%, 4/22/98 (^) 100,000
Founders National Bank, 5.30%, 8/28/98 (^) 100,000
Seaway National Bank Chicago, IL, 5.45%,
1/27/98 (^) 100,000
Self Help Credit Union, 5.60%, 7/16/98 (^) 100,000
Shore Bank &Trust, 5.20%, 12/19/97 (^) 100,000
South Shore Bank of Chicago, 5.35%, 10/30/97 (^) 100,000
Total Certificates of Deposit (Cost $1,200,000)
Commercial Paper (10.9%)
Accor SA, 5.53%, 11/25/97, LOC: National
Banque of Paris 5,000,000
National Australia Funding, 5.50%, 10/14/97,
GA: National Australia Bank 5,000,000
Northwestern University, 5.51%, 11/10/97 5,000,000
Safeco Credit Company, Inc., 5.56%, 10/20/97 3,195,000
Total Commercial Paper (Cost $18,102,839)
Taxable Variable Rate Demand Notes (75.5%)
Alabama H/M Partners LLC Community
Development VRDN, 5.70%, 10/01/20, LOC:
Amsouth Bank 4,200,000
Alabama State Industrial Development Revenue
VRDN, 5.70%, 12/1/19, LOC:
First Bank NA 5,760,000
Aspen Institute Inc. VRDN, 5.81875%, 12/1/04,
LOC: First National Bank of Maryland 1,710,000
Barton Healthcare LLC VRDN, 5.75%, 2/15/25,
LOC: American National Bank & Trust 7,400,000
Berks County PA Industrial Development
Authority Revenue VRDN, 5.75%, 6/1/15, LOC:
Corestates 2,250,000
Bexar County Health Facilities Revenue VRDN,
5.98%, 2/1/22, LOC: Kredietbank 2,665,000
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
SEPTEMBER 30, 1997
U.S. Government Agencies Value
and Instrumentalities (6.0%)
Federal National Mortgage Assn., 5.33%, 10/16/97 $4,988,896
Student Loan Marketing Assn, 5.79%, 9/16/98 5,002,267
Total U.S. Government Agencies and
Instrumentalities (Cost $9,991,163) 9,991,163
Certificates of Deposit (0.7%)
Bank of Cherokee County, 5.50%, 4/22/98 (^) 100,000
Broadway Federal Savings & Loan, 5.20%,
8/20/98 100,000
Community Bank of the Bay, 5.50%, 10/7/97 (^) 100,000
Community Capital Bank, 5.05%, 1/20/98 (^) 100,000
Elk Horn Bank & Trust, 5.27%, 12/18/97 (^) 100,000
Family Savings Bank, 5.40%, 8/20/98 (^) 100,000
First Community Bank, 5.10%, 4/22/98 (^) 100,000
Founders National Bank, 5.30%, 8/28/98 (^) 100,000
Seaway National Bank Chicago, IL, 5.45%,
1/27/98 (100,000)
Self Help Credit Union, 5.60%, 7/16/98 (^) 100,000
Shore Bank &Trust, 5.20%, 12/19/97 (^) 100,000
South Shore Bank of Chicago, 5.35%, 10/30/97 (^) 100,000
Total Certificates of Deposit (Cost $1,200,000) 1,200,0000
Commercial Paper (10.9%)
Accor SA, 5.53%, 11/25/97, LOC:
National Banque of Par 4,957,757
National Australia Funding, 5.50%, 10/14/97,
GA: National Australia Bank 4,990,069
Northwestern University, 5.51%, 11/10/97 4,969,389
Safeco Credit Company, Inc., 5.56%, 10/20/97 3,185,624
Total Commercial Paper (Cost $18,102,839) 18,102,839
Taxable Variable Rate Demand Notes (75.5%)
Alabama H/M Partners LLC Community
Development
VRDN, 5.70%, 10/01/20, LOC
: Amsouth Bank 4,200,000
Alabama State Industrial Development Revenue
VRDN, 5.70%, 12/1/19, LOC:
First Bank NA 5,760,000
Aspen Institute Inc. VRDN, 5.81875%, 12/1/04,
LOC: First National Bank of Maryland 1,710,000
Barton Healthcare LLC VRDN, 5.75%, 2/15/25,
LOC: American National Bank & Trust 7,400,000
Berks County PA Industrial Development Authority
Revenue VRDN, 5.75%, 6/1/15,
LOC: Core states 2,250,000
Bexar County Health Facilities Revenue VRDN, 5.98%,
2/1/22, LOC: Kredietbank 2,665,000
<PAGE>
Principal
Taxable Variable Rate Demand Notes (Cont'd) Amount
California Statewide Community Development Revenue
VRDN, 5.90%, 7/1/27, LOC: Sanwa Bank $345,000
Chapel Oaks Inc. Revenue VRDN, 5.90%, 10/1/26,
LOC: Allied Irish Bank 7,000,000
Gardena Certificates of Participation VRDN, 5.90%, 7/1/25,
LOC: Sumitomo Trust & Banking, Confirming
LOC: Dai-Ichi Kangyo Bank 7,710,000
Hamburg NY Industrial Development Agency
Mortgage Revenue
VRDN, 5.85%, 12/20/38, LOC: Key Bank of
New York 2,400,000
Iowa Finance Authority Economic Development
Revenue VRDN,
5.65%, 3/1/11, LOC: Rabobank Nederland1,800,000
IPC Industries, Inc. VRDN, 5.70%, 10/1/11, LOC:
National Bank of Canada 4,660,000
Liliha Partners Revenue VRDN, 6.05%, 8/1/24,
LOC: First Hawaiian Bank 8,000,000
Memphis Center Finance Corp. Multi-family Housing
Revenue VRDN, 5.95%, 11/1/30, LOC: National Bank
of Commerce TN 345,000
Meriter Hospital Inc. VRDN, 5.65%, 12/1/16, LOC:
Firstar Bank
of Milwaukee 8,000,000
Mississippi Business Financial Corporation Industrial
Development Revenue VRDN, 5.95%, 5/1/12, LOC:
Mercantile Bank 3,400,000
Montgomery County Industrial Building Revenue
VRDN, 5.70%,
8/1/06, LOC: Fleet Bank 1,981,000
Montgomery County Industrial Development Authority
VRDN, 5.75%, 3/1/10, LOC: Corestates 605,000
Mt. Vernon Industrial Economic Development Revenue
VRDN,
5.90%, 7/1/07, LOC: Citizens National Bank of
Evansville, Confirming LOC: Suntrust Bank 2,600,000
Mt. Vernon Industrial Solid Waste Disposal Revenue
VRDN, 5.90%, 11/1/11, LOC: Citizens National Bank
of Evansville, Confirming
LOC: Suntrust Bank 3,500,000
Mt. Vernon Industrial Solid Waste Disposal Revenue
VRDN, 5.90%, 7/1/07, LOC: Citizens National Bank
of Evansville, Confirming
LOC: Suntrust Bank 1,000,000
Pennsylvania Economic Development Financing
Authority Revenue
VRDN, 5.65%, 7/1/16, LOC: Mellon Bank 3,800,000
Physicians Plus Medical Group VRDN, 5.70%, 8/1/16,
LOC: Marshall & Ilsley Bank 7,669,000
Roosevelt Paper Company, 5.75%, 6/1/12, LOC:
Corestates 4,620,000
Sault Sainte Marie Tribe Building Authority Revenue
VRDN, 5.94%,
6/1/03, LOC: First America Bank of Michigan 6,840,000
St. Josephs County Multi-family Housing VRDN,
Corby Apartments,
5.75%, 6/1/27, LOC: Federal Home Loan Bank 345,000
St. Josephs County Multi-family Housing VRDN, Pin Oak
Apartments, 5.75%, 6/1/27, LOC: Federal Home
Loan Bank 940,000
St. Josephs County Multi-family Housing VRDN,
West Manor
Apartments, 5.75%, 6/1/27, LOC: Federal
Home Loan Bank 570,000
Texas St., Texas Veterans Land, 5.69%, 12/1/27,
TOA: Citibank 8,000,000
<PAGE>
Taxable Variable Rate Demand Notes (Cont'd) Value
California Statewide Community Development Revenue
VRDN, 5.90%, 7/1/27, LOC: Sanwa Bank $345,000
Chapel Oaks Inc. Revenue VRDN, 5.90%, 10/1/26,
LOC: Allied Irish Bank 7,000,000
Gardena Certificates of Participation VRDN, 5.90%, 7/1/25,
LOC: Sumitomo Trust & Banking, Confirming
LOC: Dai-Ichi Kangyo Bank 7,710,000
Hamburg NY Industrial Development Agency Mortgage
Revenue
VRDN, 5.85%, 12/20/38, LOC: Key Bank of New York 2,400,000
Iowa Finance Authority Economic Development Revenue
VRDN,
5.65%, 3/1/11, LOC: Rabobank Nederland1, 800,000
IPC Industries, Inc. VRDN, 5.70%, 10/1/11, LOC:
National Bank of Canada 4,660,000
Liliha Partners Revenue VRDN, 6.05%, 8/1/24,
LOC: First Hawaiian Bank 8,000,000
Memphis Center Finance Corp. Multi-family Housing
Revenue VRDN, 5.95%, 11/1/30, LOC: National Bank
of Commerce TN 345,000
Meriter Hospital Inc. VRDN, 5.65%, 12/1/16, LOC:
Firstar Bank of Milwaukee 8,000,000
Mississippi Business Financial Corporation Industrial
Development Revenue VRDN, 5.95%, 5/1/12, LOC:
Mercantile Bank 3,400,000
Montgomery County Industrial Building Revenue
VRDN, 5.70%,
8/1/06, LOC: Fleet Bank 1,981,000
Montgomery County Industrial Development Authority
VRDN, 5.75%, 3/1/10, LOC: Corestates 605,000
Mt. Vernon Industrial Economic Development
Revenue VRDN, 5.90%, 7/1/07, LOC: Citizens
National Bank of Evansville,
Confirming LOC: Suntrust Bank 2,600,000
Mt. Vernon Industrial Solid Waste Disposal Revenue
VRDN, 5.90%, 11/1/11, LOC: Citizens National
Bank of Evansville, Confirming
LOC: Suntrust Bank 3,500,000
Mt. Vernon Industrial Solid Waste Disposal Revenue
VRDN, 5.90%, 7/1/07, LOC: Citizens National
Bank of Evansville, Confirming
LOC: Suntrust Bank 1,000,000
Pennsylvania Economic Development Financing
Authority Revenue VRDN, 5.65%, 7/1/16, LOC:
Mellon Bank 3,800,000
Physicians Plus Medical Group VRDN, 5.70%, 8/1/16,
LOC: Marshall & Ilsley Bank 7,669,000
Roosevelt Paper Company, 5.75%, 6/1/12,
LOC: Corestates 4,620,000
Sault Sainte Marie Tribe Building Authority Revenue
VRDN, 5.94%, 6/1/03, LOC: First America
Bank of Michigan 6,840,000
St. Josephs County Multi-family Housing VRDN,
Corby Apartments, 5.75%, 6/1/27, LOC: Federa
l Home Loan Bank 345,000
St. Josephs County Multi-family Housing VRDN, Pin Oak
Apartments, 5.75%, 6/1/27, LOC: Federal
Home Loan Bank 940,000
St. Josephs County Multi-family Housing VRDN,
West Manor Apartments, 5.75%, 6/1/27, LOC:
Federal Home Loan Bank 570,000
Texas St., Texas Veterans Land, 5.69%, 12/1/27,
TOA: Citibank 8,000,000
<PAGE>
Principal
Taxable Variable Rate Demand Notes (Cont'd) Amount
TLC Holdings LLC VRDN, 5.70%, 6/1/26,
LOC: Columbus Bank & Trust $5,075,000
W.L. Petrey Wholesaling, Inc. VRDN, 5.70%, 3/1/08,
LOC: Southtrust Bank of Alabama 2,815,000
Westminster Asset Corp., Senior Facilities Project, 5.74%,
4/1/22, LOC: Wells Fargo Bank, NA 7,490,000
Total Taxable Variable Rate Demand Notes
(Cost $125,495,000)
Repurchase Agreements (5.4%)
Donaldson Lufkin Jenrette, 6.125%, dated 9/30/97, due
10/1/97 (Collateral: $9,092,192 Federal National
Mortgage Assn., 5.98%, 9/23/99) 8,900,000
Taxable Variable Rate Demand Notes (Cont'd) Value
TLC Holdings LLC VRDN, 5.70%, 6/1/26,
LOC: Columbus Bank & Trust $5,075,000
W.L. Petrey Wholesaling, Inc. VRDN, 5.70%, 3/1/08,
LOC: Southtrust Bank of Alabama 2,815,000
Westminster Asset Corp., Senior Facilities Project, 5.74%,
4/1/22, LOC: Wells Fargo Bank, NA 7,490,000
Total Taxable Variable Rate Demand Notes
(Cost $125,495,000) 125,495,000
Repurchase Agreements (5.4%)
Donaldson Lufkin Jenrette, 6.125%, dated 9/30/97, due
10/1/97 (Collateral: $9,092,192 Federal National
Mortgage Assn., 5.98%, 9/23/99) 8,900,000
Total Repurchase Agreements
(Cost $8,900,000) 8,900,000
TOTAL INVESTMENTS
(Cost $163,689,00163,689,0022) - 98.5%
Other assets and liabilities, net - 1.5% 2,421,559
Net Assets - 100% $166,110,561
Net Assets Consist Of:
Paid-in-capital applicable to 166,162,505 shares
of beneficial interest; unlimited number of no par value
shares authorized $166,140,418
Undistributed net investment income 17
Accumulated net realized gain (loss) on investments (29,874)
Net Assets $166,110,561
Net Asset Value Per Share $1.00
<PAGE>
MANAGED GROWTH PORTFOLIO
STATEMENT OF NET ASSETS
SEPTEMBER 30, 1997
Principal
Certificates of Deposit (0.1%) Amount
Blackfeet National Bank, 5.00%, 11/13/97 (^) $92,000
Edward Wells Federal Credit Union, 5.00%,
11/20/97 (^) 50,000
First American Credit Union, 5.822%, 12/23/97 (^) 92,000
Mission Area Federal Credit Union, 4.95%, 11/18/97 (^) 50,000
New Alternative Federal, 5.00%, 11/18/97 (^) 50,000
Northeast Community Federal Credit Union, 4.50%,
11/18/97 (^) 50,000
South Shore Bank of Chicago, 5.15%, 12/5/97 (^) 100,000
South Shore Bank of Chicago, 5.35%, 2/9/98 350,000
Total Certificates of Deposit (Cost $834,000)
Convertible Debenture Bonds (0.0%)
WorldWater, Inc., 9.00%, 12/26/97 (*)(b) 150,000
Total Convertible Debenture Bonds (Cost $150,000)
Community Loan Notes (0.7%)
Accion International Corp., 4.00%, 1/13/00 250,000
Accion US Bridge Fund, 4.00%, 1/12/01 100,000
Boston Community Loan Fund, 4.00%, 1/12/01 500,000
Capital District Community Loan, 4.00%, 1/13/98 35,000
Cascadia Revolving Fund, 4.00%, 4/7/98 75,000
Chicago Community Loan Fund, 4.50%, 6/30/98 75,000
Coastal Enterprises, Inc., 4.50%, 6/30/99 100,000
Community Reinvestment Fund, 4.00%, 4/5/00 100,000
Co-op Fund of New England, Inc., 4.00%, 1/13/00 105,000
Delaware Valley Community Reinvestment Fund,
4.00%, 6/30/99 75,000
Eastside Community Investment, 4.00%, 4/5/00 100,000
Ecumenical Development Corp., 5.00%, 12/31/01 100,000
Enterprise Loan Fund, 3.50%, 6/30/98 50,000
Environmental Enterprises, Inc., 4.50%, 6/28/99 125,000
First State Community Loan Fund, 4.00%, 1/15/99 25,000
Foundation for International Community Asst., 3.50%,
4/30/01 50,000
Housing Assistance Council, 4.50%, 6/30/02 75,000
Institute for Community Development, 3.00%, 10/1/01 250,000
Institute for Community Economics, 4.00%, 1/13/00 150,000
Interfaith Housing Delaware, 4.50%, 3/31/98 50,000
Low Income Housing Fund, 4.00%, 1/13/99 50,000
Low Income Housing Fund, 4.00%, 9/30/99 100,000
Manna, Inc., 4.50%, 9/30/02 250,000
Michigan Housing Trust, 4.50%, 6/28/99 100,000
Micro Industry Credit Rural Corp., 4.00%, 1/13/98 100,000
Minnesota Non Profit Assistance Fund, 3.50%, 4/7/00 200,000
Montana Women's Capital, 4.50%, 6/30/99 50,000
National Fed of Community Development Credit Union,
3.00%, 4/7/98 300,000
<PAGE>
MANAGED GROWTH PORTFOLIO
STATEMENT OF NET ASSETS
SEPTEMBER 30, 1997 (Cont'd)
Value
Blackfeet National Bank, 5.00%, 11/13/97 (^) $91,622
Edward Wells Federal Credit Union, 5.00%,
11/20/97 (^) 47,795
First American Credit Union, 5.822%, 12/23/97 (^) 91,560
Mission Area Federal Credit Union, 4.95%, 11/18/97 (^) 49,797
New Alternative Federal, 5.00%, 11/18/97 (^) 48,596
Northeast Community Federal Credit Union, 4.50%,
11/18/97 (^) 49,815
South Shore Bank of Chicago, 5.15%, 12/5/97 (^) 99,577
South Shore Bank of Chicago, 5.35%, 2/9/98 348,439
Total Certificates of Deposit (Cost $834,000) 827,201
Convertible Debenture Bonds (0.0%)
WorldWater, Inc., 9.00%, 12/26/97 (*)(b) 112,500
Total Convertible Debenture Bonds (Cost $150,000) 112,500
Community Loan Notes (0.7%)
Accion International Corp., 4.00%, 1/13/00 245,710
Accion US Bridge Fund, 4.00%, 1/12/01 98,284
Boston Community Loan Fund, 4.00%, 1/12/01 491,420
Capital District Community Loan, 4.00%, 1/13/98 34,371
Cascadia Revolving Fund, 4.00%, 4/7/98 72,632
Chicago Community Loan Fund, 4.50%, 6/30/98 71,878
Coastal Enterprises, Inc., 4.50%, 6/30/99 95,903
Community Reinvestment Fund, 4.00%, 4/5/00 97,027
Co-op Fund of New England, Inc., 4.00%, 1/13/00 103,198
Delaware Valley Community Reinvestment Fund,
4.00%, 6/30/99 71,678
Eastside Community Investment, 4.00%, 4/5/00 97,027
Ecumenical Development Corp., 5.00%, 12/31/01 98,617
Enterprise Loan Fund, 3.50%, 6/30/98 47,579
Environmental Enterprises, Inc., 4.50%, 6/28/99 119,878
First State Community Loan Fund, 4.00%, 1/15/99 24,571
Foundation for International Community Asst., 3.50%,
4/30/01 48,109
Housing Assistance Council, 4.50%, 6/30/02 71,927
Institute for Community Development, 3.00%, 10/1/01 233,597
Institute for Community Economics, 4.00%, 1/13/00 147,426
Interfaith Housing Delaware, 4.50%, 3/31/98 48,595
Low Income Housing Fund, 4.00%, 1/13/99 49,142
Low Income Housing Fund, 4.00%, 9/30/99 94,314
Manna, Inc., 4.50%, 9/30/02 236,877
Michigan Housing Trust, 4.50%, 6/28/99 95,903
Micro Industry Credit Rural Corp., 4.00%, 1/13/98 98,203
Minnesota Non Profit Assistance Fund, 3.50%, 4/7/00 193,614
Montana Women's Capital, 4.50%, 6/30/99 47,951
National Fed of Community Development Credit Union,
3.00%, 4/7/98 289,119
<PAGE>
Principal
Community Loan Notes (Cont'd) Amount
New Hampshire Community Loan Fund, 4.00%, 7/15/99 $250,000
New Mexico Community Loan Fund, 4.50%, 6/30/98 25,000
Nonprofit Facilities Fund, 4.50%, 6/30/99 100,000
North Country Co-op Development Fund, 4.00%, 1/12/01 100,000
Northeast Entrepreneur Fund, 3.50%, 6/30/98 50,000
Northeast South Dakota Energy Conservation Corp., 4.00%,
1/13/98 25,000
Opportunity International, 3.50%, 9/30/99 100,000
Sage Bruno, 6.00%, 12/31/99 150,000
Saint Ambrose Housing Center, 4.50%, 3/31/98 50,000
12th Street Historic Rehabilitation Associates
Mortgage, 10.75%, 4/15/99 (b) 360,978
Vermont Community Loan Fund, 4.00%, 4/30/01 200,000
Washington Area Community Investment Fund, 4.00%,
12/31/01 317,000
Western Massachusetts Enterprise Fund, 4.00%, 9/30/98 50,000
Women's Self-Employment Loan Fund, 4.50%, 9/30/98 50,000
Total Community Loan Notes (*)(Cost $5,367,978)
Corporate Bonds (36.8%)
Abbey National PLC, 6.69%, 10/17/05 5,000,000
Advanta Corp., 7.05%, 7/30/99 3,000,000
AGL Capital Trust, 8.17%, 6/1/37 7,000,000
Alco Capital Resources, Inc., 6.32%, 12/10/01 3,000,000
Alco Capital Resources, Inc., 6.94%, 3/7/01 3,000,000
All Media Solutions, 9.00%, 2/1/98 (*) 100,000
American General Institute Capital, 7.57%, 12/1/45 2,000,000
AON Corp., 6.875%, 10/1/99 1,000,000
Bankboston Capital Trust III, 6.46875%, 6/15/27 5,000,000
Bankers Trust New York, 7.25%, 10/15/11 4,000,000
Central Fidelity Capital Trust I, 6.75%, 4/15/27 6,000,000
Cigna Corp., 6.375%, 1/15/06 5,000,000
Clean Air Cab, 6.00%, 12/31/98 (*)(b) 250,000
Conseco Finance Trust, 8.796%, 4/1/27 5,500,000
Conseco, Inc., 10.50%, 12/15/04 2,400,000
Corestates Capital III, 6.32%, 2/15/27 7,000,000
Credit Suisse First Boston, 7.90%, 4/29/49 5,000,000
Crescent Real Estate Equities, 6.625%, 9/15/02 4,000,000
Dayton Hudson Corp., 10.00%, 12/1/00 5,000,000
Dime Capital Trust I, 9.33%, 5/6/27 2,000,000
Donnelly, R.R., and Sons, Co., 6.70%, 7/5/05 3,000,000
Dresdner Bank, 6.625%, 9/15/05 5,000,000
Dresdner Bank, 7.25%, 9/15/15 2,500,000
First National Bank Commerce, 6.50%, 1/14/00 4,000,000
First Plus Home Loan Owner Trust, 6.28%, 9/10/06 6,000,000
Goldman Sachs Group L.P., 6.20%, 12/15/00 2,000,000
Goldman Sachs Group L.P., 6.75%, 2/15/06 2,000,000
Greenpoint Capital Trust, 9.10%, 6/1/27 2,500,000
Greentree Financial Corp., 6.50%, 9/26/02 2,000,000
Harcourt General, Inc., 7.20%, 8/1/27 5,500,000
<PAGE>
Community Loan Notes (Cont'd) Value
New Hampshire Community Loan Fund, 4.00%, 7/15/99 $238,925
New Mexico Community Loan Fund, 4.50%, 6/30/98 23,959
Nonprofit Facilities Fund, 4.50%, 6/30/99 95,903
North Country Co-op Development Fund, 4.00%, 1/12/01 98,284
Northeast Entrepreneur Fund, 3.50%, 6/30/98 47,579
Northeast South Dakota Energy Conservation Corp., 4.00%,
1/13/98 24,551
Opportunity International, 3.50%, 9/30/99 93,876
Sage Bruno, 6.00%, 12/31/99 150,000
Saint Ambrose Housing Center, 4.50%, 3/31/98 48,595
12th Street Historic Rehabilitation Associates
Mortgage, 10.75%, 4/15/99 (b) 90,244
Vermont Community Loan Fund, 4.00%, 4/30/01 192,960
Washington Area Community Investment Fund, 4.00%,
12/31/01 311,871
Western Massachusetts Enterprise Fund, 4.00%, 9/30/98 47,067
Women's Self-Employment Loan Fund, 4.50%, 9/30/98 47,294
Total Community Loan Notes (*)(Cost $5,367,978) 4,935,658
Corporate Bonds (36.8%)
Abbey National PLC, 6.69%, 10/17/05 5,009,450
Advanta Corp., 7.05%, 7/30/99 2,990,190
AGL Capital Trust, 8.17%, 6/1/37 7,252,980
Alco Capital Resources, Inc., 6.32%, 12/10/01 2,990,760
Alco Capital Resources, Inc., 6.94%, 3/7/01 3,049,320
All Media Solutions, 9.00%, 2/1/98 (*) 100,000
American General Institute Capital, 7.57%, 12/1/45 1,956,800
AON Corp., 6.875%, 10/1/99 1,012,640
Bankboston Capital Trust III, 6.46875%, 6/15/27 4,946,280
Bankers Trust New York, 7.25%, 10/15/11 4,066,480
Central Fidelity Capital Trust I, 6.75%, 4/15/27 6,091,440
Cigna Corp., 6.375%, 1/15/06 4,848,350
Clean Air Cab, 6.00%, 12/31/98 (*)(b) 10,000
Conseco Finance Trust, 8.796%, 4/1/27 5,913,765
Conseco, Inc., 10.50%, 12/15/04 2,870,160
Corestates Capital III, 6.32%, 2/15/27 6,969,970
Credit Suisse First Boston, 7.90%, 4/29/49 5,277,680
Crescent Real Estate Equities, 6.625%, 9/15/02 3,980,400
Dayton Hudson Corp., 10.00%, 12/1/00 5,506,600
Dime Capital Trust I, 9.33%, 5/6/27 2,169,040
Donnelly, R.R., and Sons, Co., 6.70%, 7/5/05 3,030,360
Dresdner Bank, 6.625%, 9/15/05 4,989,550
Dresdner Bank, 7.25%, 9/15/15 2,547,675
First National Bank Commerce, 6.50%, 1/14/00 4,027,680
First Plus Home Loan Owner Trust, 6.28%, 9/10/06 6,018,180
Goldman Sachs Group L.P., 6.20%, 12/15/00 1,994,960
Goldman Sachs Group L.P., 6.75%, 2/15/06 1,990,962
Greenpoint Capital Trust, 9.10%, 6/1/27 2,621,650
Greentree Financial Corp., 6.50%, 9/26/02 1,996,400
Harcourt General, Inc., 7.20%, 8/1/27 5,425,970
<PAGE>
Principal
Corporate Bonds (Cont'd) Amount
Household Finance Corp., 6.63%, 5/28/99 $5,000,000
Household Finance Corp., 8.375%, 11/15/01 1,500,000
HSB Capital I, 6.66%, 7/15/27 2,000,000
Ikon Capital Resources, 6.27%, 7/19/99 5,000,000
Interpool, Inc., 7.20%, 8/1/07 1,000,000
Kaiser Foundation Hospitals, 7.63%, 4/19/99 2,000,000
Key Bank, 7.50%, 9/15/08 3,000,000
Liliha Partners L.P., 6.05%, 8/1/24 4,900,000
Localiza Rent A Car, 10.25%, 10/1/05 500,000
Long Island Savings Bank, 7.00%, 6/13/02 2,500,000
Mark IV Industries, Inc., 7.50%, 9/1/07 6,000,000
McCormick & Co., Inc., 8.95%, 7/1/01 1,750,000
McKesson Corp., 6.875%, 3/1/02 4,500,000
Medpartners, Inc., 6.875%, 9/1/00 12,000,000
Merita Bank, Ltd., 7.15%, 12/29/49 5,000,000
Michigan Bell Telephone Co., 9.25%, 11/15/98 1,000,000
National Association of People with AIDS, 10.00%,
1/31/98 (*)(b) 250,000
Nationsbank Corp., 6.30%, 1/15/27 2,500,000
NCB Affordable Housing / Market Rate Cooperative
First Mortgage Certificates Series 1993-3 B, 7.439%,
1/1/99 2,592,435
Norwest Financial, Inc., 6.8752%, 12/15/99 2,000,000
Ohio Savings Capital Trust I, 9.50%, 6/3/27 6,000,000
Penny (J.C.), Inc., 5.375%, 11/15/98 2,500,000
Penny (J.C.), Inc., 6.95%, 4/1/00 3,500,000
Penny (J.C.), Inc., 7.625%, 3/1/2097 1,000,000
Picturetalk, Inc., 8.00%, 3/13/99 (*) 500,000
Poland Partners, 5.875%, 4/13/04 (*) 458,277
Prime Property Funding II, 6.80%, 8/15/02 4,000,000
Puget Sound Energy, 6.23%, 7/11/02 2,000,000
Puget Sound Energy Capital Trust I, 8.231%, 6/1/27 1,000,000
Security Benefit Life Co., 8.75%, 5/15/16 3,000,000
Socgen Real Estate Co., 7.64%, 12/29/49 3,500,000
Sun Trust Capital I, 6.42%, 5/15/27 3,000,000
Swedbank Sparbank Svenge, 7.50%, 9/1/12 14,000,000
Take the Lead, 9.00%, 9/27/00 (*) 100,000
Transamerica Corp., 6.80%, 3/15/99 1,000,000
US West, Inc., 7.30%, 1/15/07 2,000,000
USF&G Capital III, 8.312%, 7/1/46 2,000,000
WorldCom, Inc., 7.55%, 4/1/04 3,000,000
Xerox Capital Trust I, 8.00%, 2/1/27 15,775,000
Zurich Capital Trust, 8.376%, 6/1/37 4,500,000
Total Corporate Bonds (Cost $249,388,226)
Municipal Obligations (2.7%)
Chickasaw Nation Certificates of Participation, 10.00%,
8/1/03 (c) 5,855,000
Maryland State Economic Development Corp.
Revenue Bonds, 8.00%, 10/1/05 4,000,000
<PAGE>
Corporate Bonds (Cont'd) Value
Household Finance Corp., 6.63%, 5/28/99 $5,042,450
Household Finance Corp., 8.375%, 11/15/01 1,605,660
HSB Capital I, 6.66%, 7/15/27 1,994,674
Ikon Capital Resources, 6.27%, 7/19/99 5,016,350
Interpool, Inc., 7.20%, 8/1/07 992,190
Kaiser Foundation Hospitals, 7.63%, 4/19/99 2,050,460
Key Bank, 7.50%, 9/15/08 3,138,690
Liliha Partners L.P., 6.05%, 8/1/24 4,900,000
Localiza Rent A Car, 10.25%, 10/1/05 502,500
Long Island Savings Bank, 7.00%, 6/13/02 2,531,975
Mark IV Industries, Inc., 7.50%, 9/1/07 5,955,000
McCormick & Co., Inc., 8.95%, 7/1/01 1,903,860
McKesson Corp., 6.875%, 3/1/02 4,581,675
Medpartners, Inc., 6.875%, 9/1/00 11,987,604
Merita Bank, Ltd., 7.15%, 12/29/49 5,042,950
Michigan Bell Telephone Co., 9.25%, 11/15/98 1,037,510
National Association of People with AIDS, 10.00%,
1/31/98 (*)(b) 25,000
Nationsbank Corp., 6.30%, 1/15/27 2,450,250
NCB Affordable Housing / Market Rate Cooperative
First Mortgage Certificates Series 1993-3 B, 7.439%,
1/1/99 2,641,173
Norwest Financial, Inc., 6.8752%, 12/15/99 2,030,880
Ohio Savings Capital Trust I, 9.50%, 6/3/27 6,359,160
Penny (J.C.), Inc., 5.375%, 11/15/98 2,489,700
Penny (J.C.), Inc., 6.95%, 4/1/00 3,565,310
Penny (J.C.), Inc., 7.625%, 3/1/2097 1,027,450
Picturetalk, Inc., 8.00%, 3/13/99 (*) 471,550
Poland Partners, 5.875%, 4/13/04 (*) 295,806
Prime Property Funding II, 6.80%, 8/15/02 4,017,920
Puget Sound Energy, 6.23%, 7/11/02 2,005,660
Puget Sound Energy Capital Trust I, 8.231%, 6/1/27 1,035,130
Security Benefit Life Co., 8.75%, 5/15/16 3,270,780
Socgen Real Estate Co., 7.64%, 12/29/49 3,551,156
Sun Trust Capital I, 6.42%, 5/15/27 2,981,526
Swedbank Sparbank Svenge, 7.50%, 9/1/12 14,048,860
Take the Lead, 9.00%, 9/27/00 (*) 50,000
Transamerica Corp., 6.80%, 3/15/99 1,011,410
US West, Inc., 7.30%, 1/15/07 2,046,860
USF&G Capital III, 8.312%, 7/1/46 2,073,300
WorldCom, Inc., 7.55%, 4/1/04 3,118,980
Xerox Capital Trust I, 8.00%, 2/1/27 16,337,694
Zurich Capital Trust, 8.376%, 6/1/37 4,763,250
Total Corporate Bonds (Cost $249,388,226) 251,608,045
Municipal Obligations (2.7%)
Chickasaw Nation Certificates of Participation, 10.00%,
8/1/03 (c) 3,513,000
Maryland State Economic Development Corp.
Revenue Bonds, 8.00%, 10/1/05 4,069,280
<PAGE>
Principal
Municipal Obligations (Cont'd) Amount
Maryland State Economic Development Corp.
Revenue Bonds, 8.625%, 10/1/19 $3,750,000
Orange County Pension Obligation, 6.16%, 9/1/98 2,630,000
Virginia Development Authority Revenue Bonds, 7.40%,
7/1/06 1,680,000
Virginia Development Authority Revenue Bonds, 7.45%,
7/1/07 2,270,000
Total Municipal Obligations (Cost $20,233,070)
Repurchase Agreements (1.3%)
Union Bank of Switzerland : 6.20%, dated 9/30/97, due
10/1/97 (Collateral: $9,042,064 FHLMC, 9.00%, 4/1/23) 8,800,000
Total Repurchase Agreements (Cost $8,800,000)
Limited Partnership Interest (0.4%)
Environment Allies Investment Trust
Environment Private Equity Fund
Global Environment Emerging Markets Fund
GEEMF Partners (#)
Hambrecht & Quist Environmental Technology Fund
HFG Expansion Fund I
Liberty Environmental Partners
Ukraine Fund
Total Limited Partnership Interest (*)(Cost $2,187,346)
<PAGE>
Municipal Obligations (Cont'd) Value
Maryland State Economic Development Corp.
Revenue Bonds, 8.625%, 10/1/19 $3,957,900
Orange County Pension Obligation, 6.16%, 9/1/98 2,637,338
Virginia Development Authority Revenue Bonds, 7.40%,
7/1/06 1,768,032
Virginia Development Authority Revenue Bonds, 7.45%,
7/1/07 2,398,459
Total Municipal Obligations
(Cost $20,233,070) 18,344,009
Repurchase Agreements (1.3%)
Union Bank of Switzerland : 6.20%, dated 9/30/97, due
10/1/97 (Collateral: $9,042,064 FHLMC,
9.00%, 4/1/23) 8,800,000
Total Repurchase Agreements (Cost $8,800,000) 8,800,000
Limited Partnership Interest (0.4%)
Environment Allies Investment Trust 51,380
Environment Private Equity Fund 123,277
Global Environment Emerging Markets Fund 1,489,000
GEEMF Partners (#) 511,000
Hambrecht & Quist Environmental Technology Fund 356,726
HFG Expansion Fund I 91,250
Liberty Environmental Partners 350,000
Ukraine Fund 54,138
Total Limited Partnership Interest
(3,026,771*)(Cost $2,187,346)
Equity Securities (57.6%) Shares Value
Basic Industries (0.7%)
Praxair, Inc. 61,800 3,163,388
Sigma Aldrich 57,500 1,893,906
5,057,294
Capital Goods (5.9%)
Avery Dennison Corp. 116,530 4,661,200
Belden, Inc. 107,800 4,062,713
Deere & Co. 41,800 2,246,750
Dover Corp. 58,900 3,997,837
Illinois Tool Works, Inc. 70,400 3,520,000
Miller Herman, Inc. 200 10,700
Pall Corp. . 105,500 2,274,843
Parker Hannifin Corp. 54,000 2,430,000
SCI Systems (#) 40,000 1,982,500
Sealed Air Corp. (#) 49,425 2,715,286
Solectron Corp. (#) 103,800 4,619,100
Tyco International, Ltd. 49,300 4,045,681
Vishay Intertechnology, Inc. (#) 143,120 3,783,735
40,350,345
<PAGE>
Equity Securities (Cont'd) Shares Value
Communication Services (1.6%)
Ameritech Corp. 59,290 $3,942,785
Century Telephone Enterprises 93,975 4,134,900
SBC Communications, Inc. 52,120 3,198,865
11,276,550
Consumer Cyclicals (6.8%)
Acxiom Corp. (#) 128,400 2,238,975
Autozone, Inc. (#) 283,200 8,496,000
Barnes & Noble, Inc. (#) 60 1,695
Caseys General Stores, Inc. 68,300 1,681,887
Consolidated Stores Corp.(#) 80,710 3,379,731
CUC International, Inc. (#) 156,325 4,846,075
Dollar General Corp. 89,062 3,033,691
Fastenal Co. 62,200 3,312,150
Home Depot, Inc. 121,520 6,334,230
Jones Apparel Group, Inc.(#) 27,600 1,490,400
Nordstrom, Inc. 36,400 2,320,500
Penny (J.C.), Inc. 73,220 4,265,065
Real Goods Trading Corp.(#)(*) 125,000 675,000
Rouse Co. 126,800 3,930,800
Viking Office Products, Inc. (#) 28,200 613,350
46,619,549
Consumer Staples (6.2%)
Avon Products, Inc. 66,100 4,098,200
Cardinal Health, Inc. 129,750 9,212,250
Colgate Palmolive Co. 32,300 2,250,906
CPC International 31,300 2,899,162
CVS Corp. 39,300 2,235,187
Dial Corp. 128,500 2,240,718
Fort James Corp. 65,175 2,985,830
Gillette Co. 38,800 3,348,925
Heinz H J Co. 93,300 4,309,293
Hershey Foods Corp. 41,100 2,322,150
Interstate Bakeries Corp. 39,200 2,687,650
Kroger Co. (#) 117,400 3,544,012
Odwalla, Inc. (#) 5,879 57,320
42,191,603
Energy (1.0%)
Baker Hughes, Inc. 101,500 4,440,625
Barrett Resources Corp. (#) 56,100 2,184,394
6,625,019
Financial Services (12.5%)
Aflac, Inc. 120,172 6,519,331
American International Group, Inc. 68,068 7,023,767
Bank of Boston Corp. 38,650 3,418,109
Bank One Corp. 86,600 4,833,363
BankAmerica Corp. 67,400 4,941,262
Chase Manhattan Corp. 87,400 10,313,200
<PAGE>
Equity Securities (Cont'd) Shares Value
Financial Services (Cont'd)
Equitable Companies, Inc. 58,500 $2,402,156
Federal National Mortgage Assn. 156,420 7,351,740
Greentree Financial Corp. 228,800 10,753,600
MGIC Investment Corp. 62,000 3,553,375
Post Properties, Inc. 88,700 3,525,825
Price (T. Rowe) Associates, Inc. 85,200 5,729,700
State Street Boston Corp. 38,600 2,352,187
Sunamerica, Inc. 117,750 4,614,328
Umbono Investment Corp. (#)(a) 2,846,419 8,061,952
85,393,895
Media & Publishing (0.1%)
UOL Publishing, Inc. (#) 25,080 555,835
555,835
Pharmaceutical & Health Care (7.0%)
Amgen (#) 139,800 6,701,662
Aviron (#)(*) 37,074 931,486
Boston Scientific Corp. (#) 53,225 2,937,354
Guidant Corp. 54,400 3,046,400
Hayes Medical Services (#)(*) 303,030 500,000
Health Management Association (#) 48,100 1,521,162
Healthsouth Corp. (#) 180,800 4,825,100
Johnson & Johnson 49,700 2,863,962
Medtronic, Inc. 95,600 4,493,200
Merck & Co., Inc. 55,612 5,557,724
R.P. Scherer Corp. (#) 62,900 3,895,868
Schering Plough Corp .150,100 7,730,150
United Healthcare Corp. 59,300 2,965,000
47,969,068
Technology (13.4%)
Automatic Data Processing, Inc. 60,000 3,000,000
BMC Software, Inc.(#) 92,010 5,957,647
Cisco Systems, Inc. (#) 155,900 11,390,444
Compaq Computer Corp. (#) 74,500 5,568,875
Computer Associates International, Inc. 76,925 5,524,176
EMC Corp.(#) 146,965 8,579,081
Hewlett Packard Co. 69,320 4,822,072
Intel Corp. 68,800 6,351,100
L.M. Ericsson (ADR) 60,265 2,888,953
Microsoft Corp.(#) 42,320 5,599,465
Oracle Systems Corp.(#) 249,963 9,108,027
Quantum Corp. (#) 44,000 1,685,750
Sterling Commerce, Inc. (#) 112,000 4,025,000
Sterling Software, Inc. (#) 94,500 3,390,187
Sun Microsystems, Inc.(#) 88,260 4,131,671
Tellabs, Inc. (#) 45,500 2,343,250
3Com Corp.(#) 90,975 4,662,468
Western Digital Corp. (#) 62,200 2,491,910
91,520,076
<PAGE>
Equity Securities (Cont'd) Shares Value
Transportation (0.4%)
AMR Corp. (#) 10,600 $1,173,287
Lear Corp. (#) 35,000 1,723,750
2,897,037
Utilities (1.1%)
California Energy, Inc. (#) 84,800 2,819,600
MCN Corp. 137,000 4,384,000
7,203,600
Venture Capital (0.9%)
Agraquest, Inc. (#)(*) 190,477 200,000
All Media Solutions, Inc.(#)(*) 307,692 200,000
Calypte Biomedical (warrants)(#)(*) 100,000 122,072
Calypte Biomedical Series E, Preferred
(#)(*) 100,000 700,000
Clean Air Cab (#)(*) 80 0
Coastal Venture Partners (*) 80,000 80,000
Community Bank of the Bay (#)(*) 4,000 100,000
Community Growth Fund (*) 1,237,857 578,402
Earths Best Stock (#)(*) 67,500 32,009
Eco Timber International, Inc.(#)(*) 12,468 99,993
Energia Global, Inc., Series A, Convertible
Preferred (#)(*) 80,129 560,903
Energia Global, Inc., Series B, Convertible
Preferred (#)(*) 28,571 199,997
Envirolutions, Inc. (#)(*) 814 26,185
Evergreen Solar (#)(*) 100,000 150,000
Fountainhead Technologies, Inc.,
Preferred (#)(*) 3,295 25,000
IEPF Equity Fund III (#)(*) 100,000 100,000
Knowaste LLC (#)(*) 814 81,400
Living Technologies, Inc. (#)(*) 25,000 100,000
Neighborhood Bancorp (#)(*) 10,000 100,000
Paradigm Biosciences (#)(*) 125,000 275,000
Paradigm, Inc. (#)(*) 121,591 250,000
Picturetalk (warrants) (#)(*) 22,222 0
Poland Partners, L.P. (*) 238,000 238,000
Pro Fund International (#)(*) 4,553 4,553
Pro Fund International, Preferred (#)(*) 450,723 450,723
Quadrant Healthcare Plc. (#)(*) 305,263 467,624
Ultrafem, Inc. (#)(*) 25,000 221,875
Ultrafem, Inc. (warrants)(#)(*) 175,000 201,809
Wild Planet Toys, Inc., Series B,
Preferred (#)(*) 476,190 357,142
Wind Harvest Co., Inc., Series A,
Preferred (#)(*) 8,696 50,000
5,972,687
Total Equity Securities (Cost $288,866,815) 393,632,558
TOTAL INVESTMENTS (Cost $575,827,435) - 99.6% 681,286,742
Other assets and liabilities, net - 0.4% 2,917,433
Net Assets - 100% $684,203,995
<PAGE>
Net Assets Consist of: Value
Paid-in-capital applicable to the following shares
of beneficial interest unlimited number of no par shares
authorized
Class A: 19,361,689 shares outstanding $511,991,083
Class C: 257,731 shares outstanding7,706,824
Undistributed net investment income 668,238
Accumulated net realized gain (loss) 58,378,543
Net unrealized appreciation (depreciation) on investments 105,459,307
Net Assets $684,203,995
Net Asset Value Per Share
Class A (based on net assets of $675,306,495) $34.88
Class C (based on net assets of $8,897,500) $34.52
<PAGE>
BOND PORTFOLIO
STATEMENT OF NET ASSETS
SEPTEMBER 30, 1997
Principal
Corporate Bonds (88.3%) Amount
AGL Capital Trust, 8.17%, 6/1/37 $1,000,000
Advanta Corp., 7.05%, 7/30/99 2,000,000
American General Institutional Capital A, 7.57%,
12/01/45 2,000,000
American General Institutional Capital B, 8.125%,
3/15/46 1,000,000
Bankboston Capital Trust III, 6.5625%, 6/15/27 1,000,000
BellSouth Savings & Employee ESOP, 9.125%, 7/1/03 178,656
Central Fidelity Capital Trust I, 6.75%, 4/15/27 1,000,000
Citizens Utilities Co., 8.45%, 9/1/01 1,000,000
Conseco Financial Trust, 8.796%, 4/01/27 2,500,000
Countrywide Capital III, 8.05%, 6/15/27 1,000,000
Crescent Real Estate Equities, 6.625%, 9/15/02 1,000,000
Dime Capital Trust I, 9.33%, 5/6/27 500,000
Goldman Sachs Group LP, 6.20%, 12/15/00 2,500,000
Greenpoint Capital Trust I, 9.10%, 6/1/27 500,000
HSB Capital I, 6.66%, 7/15/27 1,000,000
Harcourt General, Inc., 7.20%, 8/1/27 1,500,000
Household Financial Corp., 6.63%, 5/28/99 1,000,000
Key Bank of New York, 7.50%, 9/15/08 1,040,000
Key Bank USA, 7.55%, 9/15/06 500,000
McKesson Corp., 6.875%, 3/1/02 2,500,000
Medpartners, Inc., 6.875%, 9/1/00 3,000,000
Merita Bank, Ltd., 7.15%, 12/29/49 1,500,000
National Cooperative Bank, 7.439%, 7/1/12 777,731
Nationsbank Capital Trust III, 6.30%, 1/15/27 3,000,000
New England Telephone & Telegraph Co., 5.05%,
10/1/98 500,000
Norwest Financial, Inc., 6.625%, 7/15/04 1,500,000
Penny (J.C.), Inc., 7.625%, 3/1/2097 1,000,000
Prime Property Funding II, 6.80%, 8/15/02 2,000,000
Puget Sound Energy, 6.23%, 7/11/02 1,000,000
Reed Elsevier Capital, Inc., 6.625%, 5/15/00 2,300,000
Riggs Capital Trust II, 8.875%, 3/15/27 2,000,000
Sub Capital Income Securities, Series A, 6.42%,
5/15/27 1,000,000
Swedbank Sparbank Svenge, 7.50%, 9/1/12 2,000,000
Xerox Capital Trust I, 8.00%, 2/01/27 3,000,000
Zurich Capital Trust, 8.376%, 6/1/37 2,500,000
Total Corporate Bonds (Cost $51,963,395)
<PAGE>
BOND PORTFOLIO
STATEMENT OF NET ASSETS
SEPTEMBER 30, 1997 (Cont'd)
Corporate Bonds (88.3%) Value
AGL Capital Trust, 8.17%, 6/1/37 $1,036,140
Advanta Corp., 7.05%, 7/30/99 1,993,460
American General Institutional Capital A, 7.57%,
12/01/45 1,956,800
American General Institutional Capital B, 8.125%,
3/15/46 1,049,660
Bankboston Capital Trust III, 6.562 5%, 6/15/27 989,256
BellSouth Savings & Employee ES OP, 9.125%, 7/1/ 193,621
Central Fidelity Capital Trust I, 6.75%, 4/15/27 1,015,240
Citizens Utilities Co., 8.45%, 9/1/01 1,075,720
Conseco Financial Trust, 8.796%, 4/01/27 2,688,075
Countrywide Capital III, 8.05%, 6/15/27 1,041,570
Crescent Real Estate Equities, 6.625%, 9/15/02 995,100
Dime Capital Trust I, 9.33%, 5/6/27 542,260
Goldman Sachs Group LP, 6.20%, 12/15/00 2,493,700
Greenpoint Capital Trust I, 9.10%, 6/1/27 524,330
HSB Capital I, 6.66%, 7/15/27 997,337
Harcourt General, Inc., 7.20%, 8/1/27 1,479,810
Household Financial Corp., 6.63%, 5/28/99 1,008,490
Key Bank of New York, 7.50%, 9/15/08 1,088,079
Key Bank USA, 7.55%, 9/15/06 525,115
McKesson Corp., 6.875%, 3/1/02 2,545,375
Medpartners, Inc., 6.875%, 9/1/00 2,996,901
Merita Bank, Ltd., 7.15%, 12/29/49 1,512,885
National Cooperative Bank, 7.439%, 7/1/12 790,252
Nationsbank Capital Trust III, 6.30%, 1/15/27 2,940,300
New England Telephone & Telegraph Co., 5.05%,
10/1/98 496,830
Norwest Financial, Inc., 6.625%, 7/ 15/04 1,504,935
Penny (J.C.), Inc., 7.625%, 3/1/2097 1,027,450
Prime Property Funding II, 6.80%, 8/15/02 2,008,960
Puget Sound Energy, 6.23%, 7/11/0 1,002,8302
Reed Elsevier Capital, Inc., 6.625%, 5/15/00 2,322,977
Riggs Capital Trust II, 8.875%, 3/15/27 2,092,900
Sub Capital Income Securities, Series A, 6.42%,
5/15/27 993,842
Swedbank Sparbank Svenge, 7.50%, 9/1/12 2,006,980
Xerox Capital Trust I, 8.00%, 2/01/27 3,107,010
Zurich Capital Trust, 8.376%, 6/1/37 2,646,251
Total Corporate Bonds (Cost $51,963,395) 52,690,441
<PAGE>
Principal
Municipal Obligations (2.5%) Amount
Missouri Higher Education Student Loan Revenue
Bonds, 6.80%, 2/15/01 $1,000,000
Somerville, Massachusetts, U.S. Government
Guaranteed Notes, 7.12%, 8/1/01 475,000
Total Municipal Obligations (Cost $1,473,352)
Repurchase Agreements (10.7%)
Union Bank of Switzerland: 6.20%, dated 9/30/97,
due 10/1/97 (Collateral: $6,567,955 FHLMC,
8.00%, 5/1/26) 6,400,000
Total Repurchase Agreements (Cost $6,400,000)
Limited Partnership Interest (2.3%)
Northern Borders Partners, L.P. (*)
Total Equity Securities (Cost $864,075)
TOTAL INVESTMENTS (Cost $60,700,822) - 103.8%
Other assets and liabilities, net - (3.8%)
Net Assets - 100%
Net Assets Consist of:
Paid-in-capital applicable to the following 3,584,947
Class A shares of beneficial interest, unlimited number of no
par value shares authorized
Undistributed net investment income
Accumulated net realized gain (loss)
Net unrealized appreciation (depreciation) on investments
Net Assets
Net Asset Value Per Share
<PAGE>
Municipal Obligations (2.5%) Value
(Cont'd)
Missouri Higher Education Student Loan Revenue
Bonds, 6.80%, 2/15/01 $1,014,290
Somerville, Massachusetts, U.S. Government
Guaranteed Notes, 7.12%, 8/1/01 488,846
Total Municipal Obligations
(Cost $1,503,1361,473,352)
Repurchase Agreements (10.7%)
Union Bank of Switzerland: 6.20%, dated 9/30/97,
due 10/1/97 (Collateral: $6,567,955 FHLMC,
8.00%, 5/1/26) 6,400,000
Total Repurchase Agreements
(Cost6,400,000 $6,400,000)
Limited Partnership Interest (2.3%)
Northern Borders Partners, L.P. (*) 1,332,500
Total Equity Securities (Cost $864,01,332,50075)
TOTAL INVESTMENTS (Cost $60,700,822),)
- 103.8% 61,926,077
Other assets and liabilities, net - (3.8%) (2,269,980)
Net Assets - 100% $59,656,097
Net Assets Consist of:
Paid-in-capital applicable to the following 3,584,947
Class A shares of beneficial interest,
unlimited number of no
par value shares authorized $57,981,903
Undistributed net investment income 105,577
Accumulated net realized gain (loss) 343,362
Net unrealized appreciation (depreciation)
on investments 1,225,255
Net Assets $59,656,097
Net Asset Value Per Share $16.64
<PAGE>
EQUITY PORTFOLIO
STATEMENT OF NET ASSETS
SEPTEMBER 30, 1997
Equity Securities (97.1%) Shares Value
Basic Industries (5.3%)
Morton International, Inc. 111,000 $3,940,500
Nalco Chemical Co. 105,600 4,230,600
8,171,100
Capital Goods (5.8%)
Dover Corp. 70,500 4,785,188
Premark International, Inc. 128,000 4,096,000
8,881,188
Communication Services (6.1%)
Ameritech Corp. 50,000 3,325,000
SBC Communications, Inc. 96,932 5,949,202
9,274,202
Consumer Cyclicals (21.0%)
American Greetings Corp. 124,500 4,590,937
Autoliv, Inc. 31,031 1,318,818
Black & Decker Corp. 92,400 3,441,900
Federated Department Stores, Inc.(#) 120,000 5,175,000
Liz Claiborne, Inc. 70,000 3,845,625
Masco Corp. 78,400 3,591,700
Office Depot, Inc. (#) 1,000 20,187
Office Max, Inc. (#) 3,400 51,638
Reebok International, Ltd. 82,100 3,997,244
Sunglass Hut International, Inc.(#) 340,000 2,635,000
Viad Corp. 184,200 3,511,313
32,179,362
Consumer Staples (10.3%)
Albertsons, Inc. 120,000 4,185,000
Colgate Palmolive Co. 46,000 3,205,625
General Nutrition Companies, Inc.(#) 150,000 4,368,750
Rubbermaid, Inc. 160,000 4,090,000
15,849,375
Energy (4.9%)
Enron Corp. 119,000 2,647,750
United Meridian Corp. (#) 132,000 4,851,000
7,498,750
Financial Services (9.9%)
Aetna, Inc. 18,000 1,465,875
BankAmerica Corp. 30,000 2,199,375
Chase Manhattan Corp. 30,000 3,540,000
Chubb Corp. 54,000 3,837,375
USF&G Corp. 180,000 4,128,750
15,171,375
Equity Securities (Cont'd) Shares Value
Pharmaceutical & Health Care (5.4%)
Healthsouth Corp. (#) 140,000 $3,736,250
Merck & Co., Inc. 20,000 1,998,750
Schering Plough Corp. 50,000 2,575,000
8,310,000
Technology (23.1%)
Ascend Communications, Inc. (#) 91,500 2,962,312
Cabletron Systems, Inc. (#) 120000 3,840,000
Computer Associates International, Inc. 72,000 5,170,500
Gateway 2000, Inc. (#) 100,000 3,143,750
Ikon Office Solutions, Inc. 118,500 3,029,156
Intel Corp. 62,000 5,723,375
International Business Machines Corp. 40,000 4,237,500
Symantec Corp. (#) 185,000 4,208,750
3Com Corp. (#) 60,000 3,075,000
35,390,343
Transportation (5.3%)
Ryder System, Inc. 115,000 4,132,812
US Freightways Corp. 117,000 3,934,125
8,066,937
Total Equity Securities (Cost $120,033,381) 148,792,632
<PAGE>
STATEMENT OF NET ASSETS
SEPTEMBER 30, 1997
(Cont'd)
Principal
Repurchase Agreements (5.0%) Amount
State Street Bank: 5.75%, dated 9/30/97, due 10/1/97
(Collateral: $8,122,379, FNMA, 6.25%, 11/10/99) 7,700,000
Total Repurchase Agreements (Cost $7,700,000)
TOTAL INVESTMENTS (Cost $127,733,381)
- - 102.1%
Other assets and liabilities, net - (2.1%)
Net Assets - 100%
Net Assets Consist of:
Paid-in-capital applicable to the following shares
of beneficial interest unlimited number of no
par shares authorized
Class A: 5,294,260 shares outstanding
Class C: 236,978 shares outstanding
Accumulated net realized gain (loss)
Net unrealized appreciation (depreciation)
on investments
Net Assets
Net Asset Value Per Share
Class A (based on net assets of $147,002,362)
Class C (based on net assets of $6,248,542)
<PAGE>
Value
STATEMENT OF NET ASSETS
SEPTEMBER 30, 1997
(Cont'd)
Repurchase Agreements (5.0%)
State Street Bank: 5.75%, dated 9/30/97, due 10/1/97
(Collateral: $8,122,379, FNMA, 6.25%, 11/10/99) 7,700,000
Total Repurchase Agreements (Cost $7,700,700) 7,700,000
TOTAL INVESTMENTS (Cost $127,733,381) - 102.1% 156,492,6321)
Other assets and liabilities, net - (2.1%) (3,241,728)
Net Assets - 100% $153,250,904
Net Assets Consist of:
Paid-in-capital applicable to the following shares
of beneficial interest unlimited number of no
par shares authorized
Class A: 5,294,260 shares outstanding $104,016,879
Class C: 236,978 shares outstanding5,028,365
Accumulated net realized gain (loss) 15,446,409
Net unrealized appreciation (depreciation) on investments 28,759,251
Net Assets $153,250,904
Net Asset Value Per Share
Class A (based on net assets of $147,002,362) $27.77
Class C (based on net assets of $6,248,542) $26.37
(^) These certificates of deposit are fully insured by agencies of the
federal government.
Explanation of Guarantees:
(#) Non-income producing.
GA: Guarantee Agreement
LOC: Letter of Credit
TOA: Tender Option Agreement
Abbreviations: VRDN: Variable Rate Demand Notes
(*) Restricted securities representing 2.5% of net assets of
the Managed Growth Portfolio, were valued by the Board of
Trustees. See Note A.
(a) See Note B.
(b) This security is in default.
(c) This security is in default and was valued by the Board of Trustees. See
Note A.
See notes to financial statements.
<PAGE>
STATEMENTS OF OPERATIONS
YEAR ENDED SEPTEMBER 30, 1997
Money
Market
Net Investment Income Portfolio
Investment Income
Interest income $9,398,599
Dividend income (net of foreign taxes
withheld of $3,468
for Managed Growth) -
Total investment income 9,398,599
Expenses
Investment advisory fee 829,686
Transfer agency fees and expenses 511,791
Distribution Plan expenses:
Class A -
Class C -
Trustees' fees and expenses 64,533
Custodian fees 23,253
Registration fees 26,735
Reports to shareholders 134,525
Professional fees 12,254
Miscellaneous 60,027
Reimbursement from Advisor (187,751)
Total expenses 1,475,053
Fees paid indirectly (23,253)
Net expenses 1,451,800
Net Investment Income 7,946,799
Realized and Unrealized
Gain (Loss) on Investments
Net realized gain (loss) on:
Securities 1,226
Futures -
Foreign currencies -
1,226
Change in unrealized appreciation or
depreciation -
Net Realized and Unrealized
Gain (Loss) on Investments 1,226
Increase (Decrease) in Net Assets
Resulting From Operations $7,948,025
<PAGE>
Managed
Growth
Portfolio
Net Investment Income
Investment Income
Interest income $19,888,368
Dividend income (net of foreign taxes
withheld of $3,468
for Managed Growth) 3,271,394
Total investment income 23,159,762
Expenses
Investment advisory fee 3,739,407
Transfer agency fees and expenses 865,632
Distribution Plan expenses:
Class A 1,474,198
Class C 77,871
Trustees' fees and expenses 241,519
Custodian fees 108,686
Registration fees 43,356
Reports to shareholders 325,285
Professional fees 109,269
Miscellaneous 271,145
Reimbursement from Advisor (243)
Total expenses 7,256,125
Fees paid indirectly (108,686)
Net expenses 7,147,439
Net Investment Income 16,012,323
Realized and Unrealized
Gain (Loss) on Investments
Net realized gain (loss) on:
Securities 78,981,765
Futures (21,962)
Foreign currencies16
78,959,819
Change in unrealized appreciation or
depreciation 31,223,397
Net Realized and Unrealized
Gain (Loss) on Investments 110,183,216
Increase (Decrease) in Net Assets
Resulting From Operations $126,195,539
<PAGE>
STATEMENTS OF OPERATIONS
YEAR ENDED SEPTEMBER 30, 1997
Bond Equity
Net Investment Income Portfolio Portfolio
Investment Income
Interest income $4,253,270 $104,913
Dividend income 57,679 1,429,875
Total investment income 4,310,949 1,534,788
Expenses
Investment advisory fee 363,612 683,046
Transfer agency fees and expenses 124,971 299,349
Distribution Plan expenses:
Class A 122,531 277,434
Class C 1,098 44,775
Trustees' fees and expenses 24,038 44,007
Custodian fees 26,688 16,318
Registration fees 19,225 33,270
Reports to shareholders 42,465 97,121
Professional fees 4,761 9,224
Miscellaneous 27,782 61,037
Reimbursement from Advisor (1,057) -
Total expenses 756,114 1,565,581
Fees paid indirectly (26,688) (16,318)
Net expenses 729,426 1,549,263
Net Investment Income 3,581,523 (14,475)
Realized and Unrealized
Gain (Loss) on Investments
Net realized gain (loss) 1,243,910 16,858,163
Change in unrealized appreciation
or depreciation 941,907 17,734,994
Net Realized and Unrealized
Gain (loss) on Investments 2,185,817 34,593,157
Increase (Decrease) in Net Assets
Resulting From Operations $5,767,340 $34,578,682
<PAGE>
MONEY MARKET PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
Year Ended
September 30,
Increase (Decrease) in Net Assets 1997
Operations
Net investment income $7,946,799
Net realized gain (loss) 1,226
Increase (Decrease) in Net Assets
Resulting From Operations 7,948,025
Distributions to shareholders from
Net investment income (7,947,645)
Capital share transactions:
Shares sold 169,708,929
Reinvestment of distributions 7,481,634
Shares redeemed (177,596,704)
(406,141)
Total Increase (Decrease)
in Net Assets (405,761)
Net Assets
Beginning of year 166,516,322
End of year (including undistributed net
investment
income of $17 and $863, respectively) $166,110,561
Capital Share Activity
Shares sold 169,708,929
Reinvestment of distributions 7,481,634
Shares redeemed (177,596,704)
Total capital share activity (406,141)
<PAGE>
MONEY MARKET PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
(Cont'd)
Year Ended
September 30,
1996
Increase (Decrease) in Net Assets
Operations
Net investment income $7,717,644
Net realized gain (loss) (3,983)
Increase (Decrease) in Net Assets
Resulting From Operations 7,713,661
Distributions to shareholders from
Net investment income (7,717,375)
Capital share transactions:
Shares sold 166,829,716
Reinvestment of distributions 7,211,144
Shares redeemed (161,516,395)
12,524,465
Total Increase (Decrease)
in Net Assets 12,520,751
Net Assets
Beginning of year 153,995,571
End of year (including
undistributed net investment
income of $17 and $863, respectively
$166,516,322 )
Capital Share Activity
Shares sold 166,829,716
Reinvestment of distributions 7,211,144
Shares redeemed (161,516,395)
Total capital share activity 12,524,465
<PAGE>
Managed Growth Portfolio
Statements of Changes in Net Assets
Year Ended
September 30,
Increase (Decrease) in Net Assets 1997
Operations
Net investment income $16,012,323
Net realized gain (loss) 78,959,819
Change in net unrealized appreciation
or depreciation 31,223,397
Increase (Decrease) in Net Assets
Resulting From Operations 126,195,539
Distributions to shareholders from
Net investment income:
Class A Shares (15,615,127)
Class C Shares (108,855)
Net realized gain:
Class A Shares (39,194,997)
Class C Shares (483,529)
Total distributions (55,402,508)
Capital share transactions:
Shares sold:
Class A Shares 91,060,464
Class C Shares 3,006,364
Reinvestment of distributions:
Class A Shares 50,874,854
Class C Shares 576,655
Shares redeemed:
Class A Shares (131,005,332)
Class C Shares (2,299,384)
Total capital share transactions 12,213,621
Total Increase (Decrease) in
Net Assets 83,006,652
Net Assets
Beginning of year 601,197,343
End of year (including undistributed
net investment income of $668,238 and
$375,282, respectively) $684,203,995
Capital Share Activity
Shares sold:
Class A Shares 2,817,950
Class C Shares 94,710
Reinvestment of distributions:
Class A Shares 1,649,098
Class C Shares 18,971
Shares redeemed:
Class A Shares (4,069,195)
Class C Shares (72,209)
Total capital share activity 439,325
Beginning of year 601,197,343
End of year (including undistributed
net investment income of $668,238 and
$375,282, respectively) $684,203,995
Capital Share Activity
Shares sold:
Class A Shares 2,817,950
Class C Shares 94,710
Reinvestment of distributions:
Class A Shares 1,649,098
Class C Shares 18,971
Shares redeemed:
Class A Shares (4,069,195)
Class C Shares (72,209)
Total capital share activity 439,325
<PAGE>
Managed Growth Portfolio
Statements of Changes in Net Assets
(Cont'd)
Year Ended
September 30,
Increase (Decrease) in Net Assets 1996
Operations
Net investment income $14,907,120
Net realized gain (loss) 21,811,370
Change in net unrealized appreciation
or depreciation 19,966,340
Increase (Decrease) in Net Assets
Resulting From Operations 56,684,830
Distributions to shareholders from
Net investment income:
Class A Shares (14,622,197)
Class C Shares (79,219)
Net realized gain:
Class A Shares (63,482,198)
Class C Shares (481,235)
Total distributions (78,664,849)
Capital share transactions:
Shares sold:
Class A Shares 75,161,055
Class C Shares 3,298,057
Reinvestment of distributions:
Class A Shares 71,965,131
Class C Shares 548,576
Shares redeemed:
Class A Shares (91,748,763)
Class C Shares (1,093,458)
Total capital share transactions 58,130,598
Total Increase (Decrease) in
Net Assets 36,150,579
Net Assets
Beginning of year 565,046,764
End of year (including undistributed
net investment income of $668,238 and
$375,282, respectively) $601,197,343
Capital Share Activity
Shares sold:
Class A Shares 2,456,495
Class C Shares 108,790
Reinvestment of distributions:
Class A Shares 2,397,276
Class C Shares 18,464
Shares redeemed:
Class A Shares (2,989,397)
Class C Shares (35,721)
Total capital share activity 1,955,907
Beginning of year 565,046,764
End of year (including undistributed
net investment income of $668,238 and
$375,282, respectively) $601,197,343
Capital Share Activity
Shares sold:
Class A Shares 2,456,495
Class C Shares 108,790
Reinvestment of distributions:
Class A Shares 2,397,276
Class C Shares 18,464
Shares redeemed:
Class A Shares (2,989,397)
Class C Shares (35,721)
Total capital share activity 1,955,907
<PAGE>
Bond Portfolio
Statements of Changes in Net Assets
Year Ended
September 30,
Increase (Decrease) in Net Assets 1997
Operations
Net investment income $3,581,523
Net realized gain (loss) 1,243,910
Change in net unrealized appreciation
or depreciation 941,907
Increase (Decrease) in Net Assets
Resulting From Operations 5,767,340
Distributions to shareholders from
Net investment income:
Class A Shares (3,580,791)
Class C Shares (4,713)
Total distributions (3,585,504)
Capital share transactions:
Shares sold:
Class A Shares 10,499,743
Class C Shares 86,938
Reinvestment of distributions:
Class A Shares 2,785,981
Class C Shares 4,537
Shares redeemed:
Class A Shares (18,062,343)
Class C Shares (1,540,798)
Total capital share transactions (6,225,942)
Total Increase (Decrease) In Net Assets (4,044,106)
Net Assets
Beginning of year 63,700,203
End of year (including undistributed net investment
income of $105,577and $109,558, respectively) $59,656,097
Capital Share Activity
Shares sold:
Class A Shares 645,000
Class C Shares 4,676
Reinvestment of distributions:
Class A Shares 171,179
Class C Shares 283
Shares redeemed:
Class A Shares (1,107,488)
Class C Shares (95,628)
Total capital share activity (381,978)
<PAGE>
Bond Portfolio
Statements of Changes in Net Assets
(Cont'd)
Year Ended
September 30,
Increase (Decrease) in Net Assets 1996
Operations
Net investment income $3,612,447
Net realized gain (loss) 15,729
Change in net unrealized appreciation
or depreciation (1,183,585)
Increase (Decrease) in Net Assets
Resulting From Operations 2,444,591
Distributions to shareholders from
Net investment income:
Class A Shares (3,552,786)
Class C Shares (54,625)
Total distributions (3,607,411)
Capital share transactions:
Shares sold:
Class A Shares 11,109,094
Class C Shares 661,435
Reinvestment of distributions:
Class A Shares 2,753,789
Class C Shares 49,153
Shares redeemed:
Class A Shares (13,397,047)
Class C Shares (152,489)
Total capital share transactions 1,023,935
Total Increase (Decrease) In Net Assets (138,885)
Net Assets
Beginning of year 63,839,088
End of year (including undistributed net investment
income of $105,577and $109,558, respectively) $63,700,203
Capital Share Activity
Shares sold:
Class A Shares 679,640
Class C Shares 40,967
Reinvestment of distributions:
Class A Shares 169,469
Class C Shares 3,061
Shares redeemed:
Class A Shares (822,989)
Class C Shares (9,542)
Total capital share activity 60,606
<PAGE>
EQUITY PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
Year Ended
September 30,
Increase (Decrease) in Net Assets 1997
Operations
Net investment income (loss) $(14,475)
Net realized gain (loss) 16,858,163
Change in net unrealized appreciation
or depreciation 17,734,994
Increase (Decrease) in Net Assets
Resulting From Operations 34,578,682
Distributions to shareholders from
Net investment income:
Class A Shares (35,431)
Class C Shares (1,209)
Net realized gain:
Class A Shares (6,816,291)
Class C Shares (231,649)
Total distributions (7,084,580)
Capital share transactions:
Shares sold:
Class A Shares 35,065,087
Class C Shares 2,841,400
Reinvestment of distributions:
Class A Shares 6,224,717
Class C Shares 221,462
Shares redeemed:
Class A Shares (22,155,024)
Class C Shares (780,271)
Total capital share transactions 21,417,371
Total Increase (Decrease) in Net Assets 48,911,473
Net Assets
Beginning of year 104,339,431
End of year (including undistributed net investment
income of $0 and $36,595, respectively) $153,250,904
Capital Share Activity
Shares sold:
Class A Shares 1,437,044
Class C Shares 122,108
Reinvestment of distributions:
Class A Shares 273,375
Class C Shares 10,163
Shares redeemed:
Class A Shares (911,939)
Class C Shares (33,306)
Total capital share activity 897,445
<PAGE>
EQUITY PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
(Cont'd)
Year Ended
September 30,
1996
Increase (Decrease) in Net Assets
Operations
Net investment income (loss) $112,016
Net realized gain (loss) 6,588,657
Change in net unrealized appreciation
or depreciation 8,311,454
Increase (Decrease) in Net Assets
Resulting From Operations 15,012,127
Distributions to shareholders from
Net investment income:
Class A Shares (262,483)
Class C Shares (1,695)
Net realized gain:
Class A Shares (7,816,026)
Class C Shares (165,432)
Total distributions (8,245,636)
Capital share transactions:
Shares sold:
Class A Shares 19,139,948
Class C Shares 1,179,087
Reinvestment of distributions:
Class A Shares 7,431,893
Class C Shares 164,558
Shares redeemed:
Class A Shares (22,784,833)
Class C Shares (310,498)
Total capital share transactions 4,820,155
Total Increase (Decrease) in Net Assets 11,586,646
Net Assets
Beginning of year 92,752,785
End of year (including undistributed net investment
income of $0 and $36,595, respectively) $104,339,431
Capital Share Activity
Shares sold:
Class A Shares 913,008
Class C Shares 57,668
Reinvestment of distributions:
Class A Shares 367,609
Class C Shares 8,348
Shares redeemed:
Class A Shares (1,092,012)
Class C Shares (15,221)
Total capital share activity 239,400
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Note A-Significant Accounting Policies
General: The Calvert Social Investment Fund (the "Fund") is registered
under the Investment Company Act of 1940 as a diversified, open-end management
investment company. The Fund operates as a series fund with four separate
portfolios: Money Market, Managed Growth, Bond and Equity. Each Portfolio offers
shares of beneficial interest. Money Market shares are sold without a sales
charge. Managed Growth and Equity offer both Class A and Class C shares. Class A
shares are sold with a maximum front-end sales charge of 4.75% (3.75% for Bond).
Class C shares, which have no transaction-based sales charge, have a higher
annual expense rate than Class A. Each class has different: (a) dividend rates,
due to differences in Distribution Plan expenses and other class specific
expenses, (b) exchange privileges and (c) class specific voting rights. On
October 29, 1996, all outstanding Class C shares in the Bond Portfolio were
converted into an equivalent value of Class A shares. This transaction was a
non-taxable exchange and no sales charge was applied to the Class A shares
issued.
Security Valuation: Securities listed or traded on a national securities
exchange are valued at the last reported sale price. Unlisted securities and
listed securities for which the last sale price is not available are valued at
the most recent bid price or based on a yield equivalent obtained from the
securities' market maker. Municipal securities are valued utilizing the average
of bid prices or at bid prices based on a matrix system (which considers such
factors as security prices, yields, maturities and ratings) furnished by dealers
through an independent pricing service. Foreign security prices, furnished by
quotation services in the security's local currency, are translated using the
current U.S. dollar exchange rate. All securities held by Money Market are
valued at amortized cost which approximates market. The Fund may invest in
securities whose resale is subject to restrictions. Restricted securities and
other securities and assets for which market quotations are not available or
deemed inappropriate are valued in good faith under the direction of the Board
of Trustees. In determining fair value, the Board considers all relevant
qualitative and quantitative information available. These factors are subject to
change over time and are reviewed periodically. The values assigned to fair
value investments are based on available information and do not necessarily
represent amounts that might ultimately be realized, since such amounts depend
on future developments inherent in long-term investments. However, because of
the inherent uncertainty of valuation, those estimated values may differ
significantly from the values that would have been used had a ready market of
the investments existed, and the differences could be material. At September 30,
1997, $23,260,631 or 3.4% of nets assets, for Managed Growth, and $790,252 or
1.3 % for Bond, were valued by the Board of Trustees.
Repurchase Agreements: The Fund may enter into repurchase agreements with
recognized financial institutions or registered broker/dealers and, in all
instances, holds underlying securities with a value exceeding the total
repurchase price, including accrued interest. Although risk is mitigated by the
collateral, the Fund could experience a delay in recovering its value and a
possible loss of income or value if the counterparty fails to perform in
accordance with the terms of the agreement.
Options: The Fund may write or purchase option securities. The option premium is
the basis for recognition of unrealized or realized gain or loss on the option.
The cost of securities acquired or the proceeds from securities sold through the
exercise of the option is adjusted by the amount of the premium. Risks arise
from the possible illiquidity of the options market and from movements in
security values.
Futures Contracts: The Fund may enter into futures contracts
agreeing to buy or sell a financial instrument for a set price at a future date.
The Fund maintains securities with a value equal to its obligation under each
contract. Initial margin deposits of either cash or securities are made upon
entering into futures contracts; thereafter, variation margin payments are made
or received daily reflecting the change in market value. Unrealized or realized
gains and losses are recognized based on the change in market value. Risks of
futures contracts arise from the possible illiquidity of the futures markets and
the movement in the value of the investment or in interest rates.
Security Transactions and Investment Income: Security transactions are
accounted for on trade date. Realized gains and losses are recorded on an
identified cost basis. Dividend income is recorded on the ex-dividend date or,
in the case of dividends on certain foreign securities, as soon as the Fund is
informed of the ex-dividend date. Interest income, accretion of discount and
amortization of premium are recorded on an accrual basis. Investment income,
expenses and realized and unrealized gains and losses are allocated to separate
classes of shares based upon the relative net assets of each class.
Foreign Currency Transactions: The Fund's accounting records are maintained
in U.S. dollars. For valuation of assets and liabilities on each date of net
asset value determination, foreign denominations are translated into U.S.
dollars using the current exchange rate. Security transactions, income and
expenses are converted at the prevailing rate of exchange on the date of the
event. The effect of changes in foreign exchange rates on securities is included
in the net realized and unrealized gain or loss on securities.
Distributions to Shareholders: Distributions to shareholders are recorded
by the Fund on ex-dividend date. Dividends from net investment income are paid
monthly by Money Market (accrued daily) and Bond, quarterly by Managed Growth
and annually by Equity. Distributions from net realized capital gains, if any,
are paid at least annually. Distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles; accordingly, periodic reclassifications are made within the Fund's
capital accounts to reflect income and gains available for distribution under
income tax regulations.
Estimates: The preparation of the financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amount of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of income and expenses during
the reported period. Actual results could differ from those estimates.
Expense Offset Arrangement: The Fund has an arrangement with its custodian
bank whereby the custodian's fees are paid indirectly by credits earned on each
Portfolio's cash on deposit with the bank. Such deposit arrangement is an
alternative to overnight investments.
Federal Income Taxes: No provision for federal income or excise tax is
required since the Fund intends to continue to qualify as a regulated investment
company under the Internal Revenue Code and to distribute substantially all of
its earnings.
Note B-Related Party Transactions
Calvert Asset Management Company, Inc. (the "Advisor") is wholly-owned by
Calvert Group, Ltd. ("Calvert"), which is indirectly wholly-owned by Acacia
Mutual Life Insurance Company. The Advisor provides investment advisory services
and pays the salaries and fees of officers and affiliated Trustees of the Fund.
For its services, the Advisor receives monthly fees based on the following
annual rates of average daily net assets: .50% for Money Market, .65% for Bond
and .70% for Equity. Effective March 1997 the Advisor agreed to reduce its fee
to .55% for Bond until March 2000. Effective June 1995, Equity began paying a
monthly performance fee of plus or minus .20%, on an annual basis, of average
daily net assets of the performance period depending on the Portfolio's
performance compared to the Standard & Poor's 500 Index Total Return. For
Managed Growth, the Advisor receives a monthly fee based on the following annual
rates of average daily net assets: .70% on the first $500 million, .675% on the
next $500 million and .65% on the excess of $1 billion. Effective January, 1997,
Managed Growth began paying a monthly performance fee of plus or minus .15%, on
an annual basis, of average daily net assets of the performance period depending
on the portfolio's performance compared to the Lipper Balanced Funds Index. For
the year ended September 30, 1997, the performance fee adjustment increased (or
decreased) management fees by $(194,354) and $(620,990) for Equity and Managed
Growth, respectively. The Advisor reimburses the Portfolios for their respective
operating expenses (excluding brokerage fees, taxes, interest, Distribution Plan
expenses and extraordinary items) exceeding the following annual rates of
average daily net assets: 1.5% on the first $30 million and 1.0% on the excess
of $30 million for Money Market, Managed Growth and Bond. Calvert Distributors,
Inc., an affiliate of the Advisor, is the distributor and principal underwriter
for the Fund. Distribution Plans, adopted by each class of shares, allow the
Portfolios to pay the distributor for expenses and services associated with
distribution of shares. The expenses paid may not exceed .35% and 1.0% annually
of average daily net assets of each Class A and Class C for Managed Growth, Bond
and Equity, respectively. The expenses of Money Market are limited to .25%
annually of average daily net assets. The Distributor received the following as
its portion of the commissions charged on sales of each Portfolio's shares:
$331,679 for Managed Growth, $53,362 for Bond and $211,952 for Equity. Calvert
Shareholder Services, Inc., an affiliate of the Advisor, acts as transfer,
dividend disbursing and shareholder servicing agent for the Fund. Each Trustee
who is not affiliated with the Advisor receives an annual fee of $15,430 plus
$600 for each Board and Committee meeting attended. Additional fees of up to
$10,000 annually may be paid to the Chairperson of special committees of the
Board. Trustee's fees are allocated to each of the funds served. Umbono
Investment Corp., which is an affiliate because Managed Growth owns over 5% of
the voting securities, was purchased at a cost of $7,861,821 for 2,846,419
shares.
Note C-Investment Activity
During the year, purchases and sales of investments, other than short-term
securities, were:
Managed Growth Bond Equity
Purchases: $1,263,533,824 $173,691,596 $126,782,034
Sales: 1,315,864,886 186,176,254 111,557,883
Money Market held only short-term investments.
The cost of investments owned at September 30, 1997 was substantially the
same for federal income tax and financial reporting purposes for each Portfolio.
The following table presents the components of net unrealized appreciation
(depreciation) as of September 30, 1997 and the net realized capital loss
carryforwards as of September 30, 1997 with expiration dates:
Money Managed
Market Growth
Unrealized appreciation - $111,621,521
Unrealized (depreciation) - (6,162,214)
Capital loss carryforward 29,874 -
Expiration dates 1998-2004 -
Bond Equity
Unrealized appreciation $1,316,687 $33,992,950
Unrealized (depreciation) (91,432 ) (5,233,699)
Capital loss carryforward -
Expiration dates -
Capital losses may be utilized to offset current and future capital gains until
expiration.
As a cash management practice, Portfolios may sell or purchase short-term
variable rate demand notes from other Portfolios managed by the Advisor. All
transactions are executed at independently derived prices.
Note D-Line of Credit
Effective July 1, 1997, a financing agreement is in place with all Calvert
Group Funds and State Street Bank and Trust Company ("the Bank"). Under the
agreement, the Bank is providing an unsecured line of credit facility, in the
aggregate amount of $50 million ($25 million committed and $25 million
uncommitted), to be accessed by the Funds for temporary or emergency purposes
only. Borrowings under this facility bear interest at the overnight Federal
Funds Rate plus .50% per annum. A commitment fee of .10% per annum will be
incurred on the unused portion of the committed facility which will be allocated
to all participating funds. This fee is paid quarterly in arrears. The Fund had
no loans outstanding pursuant to this line of credit at September 30, 1997.
Note E-Income Tax Information
The Fund designates $36,853,535 and $1,472,536 as capital gain dividends
paid during the taxable year ended September 30, 1997 for Managed Growth
Portfolio and Equity Portfolio, respectively.
<PAGE>
MONEY MARKET PORTFOLIO
FINANCIAL HIGHLIGHTS
Years Ended
September 30, September 30,
1997 1996
Net asset value, beginning $1.00 $1.00
Income from investment operations
Net investment income .048 .048
Distributions from
Net investment income (.048) (.048)
Net asset value, ending $1.00 $1.00
Total return 4.89% 4.88%
Ratios to average net assets:
Net investment income 4.79% 4.77%
Total expenses~ .89% .89%
Net expenses .87% .87%
Expenses reimbursed .11% .21%
Net assets, ending (in thousands) $166,111 $166,516
Number of shares outstanding,
ending (in thousands) 166,163 166,569
<PAGE>
MONEY MARKET PORTFOLIO
FINANCIAL HIGHLIGHTS
Years Ended
September 30,
1995
Net asset value, beginning
Income from investment operations $1.00
Net investment income
Distributions from .050
Net investment income
Net asset value, ending (.050)
$1.00
Total return
Ratios to average net assets: 5.13%
Net investment income
Total expenses~ 5.03%
Net expenses .89%
Expenses reimbursed .87%
Net assets, ending (in thousands) .18%
Number of shares outstanding, $153,996
ending (in thousands) 154,044
Years Ended
September 30, September 30,
1994 1993
Net asset value, beginning $1.00 $1.00
Income from investment operations
Net investment income .031 .025
Distributions from
Net investment income (.031) (.025)
Net asset value, ending $1.00 $1.00
Total return 3.13% 2.56%
Ratios to average net assets:
Net investment income 3.07% 2.54%
Total expenses~ N/A N/A
Net expenses .87% .87%
Expenses reimbursed .18% .20%
Net assets, ending (in thousands) $143,779 $144,985
Number of shares outstanding,
ending (in thousands) 143,826 145,031
<PAGE>
MANAGED GROWTH PORTFOLIO
FINANCIAL HIGHLIGHTS
Years Ended
Sept. 30, Sept. 30,
Class A Shares 1997 1996
Net asset value, beginning $31.35 $32.81
Income from investment operations
Net investment income .83 .78
Net realized and unrealized gain (loss) 5.61 2.28
Total from investment operations 6.44 3.06
Distributions from
Net investment income (.81) (.77)
Net realized gain (2.10) (3.75)
Total distributions (2.91) (4.52)
Total increase (decrease) in net
asset value 3.53 (1.46)
Net asset value, ending $34.88 $31.35
Total return* 21.94% 10.27%
Ratios to average net assets:
Net investment income 2.57% 2.58%
Total expenses~ 1.14% 1.28%
Net expenses 1.12% 1.26%
Expenses reimbursed - .01%
Portfolio turnover 215% 111%
Average commission rate paid $.0508 $.0489
Net assets, ending (in thousands) $675,306 $594,482
Number of shares outstanding,
ending (in thousands) 19,362 18,964
<PAGE>
MANAGED GROWTH PORTFOLIO
FINANCIAL HIGHLIGHTS
(Cont'd)
Years Ended
Class A Shares Sept. 30
1995
Net asset value, beginning $28.77
Income from investment operations
Net investment income .87
Net realized and unrealized gain (loss) 4.25
Total from investment operations 5.12
Distributions from
Net investment income (.87)
Net realized gain (.21)
Total distributions (1.08)
Total increase (decrease) in
net asset value 4.04
Net asset value, ending $32.81
Total return* 18.21%
Ratios to average net assets:
Net investment income 2.89%
Total expenses~ 1.28%
Net expenses 1.26%
Expenses reimbursed .02%
Portfolio turnover 114%
Average commission rate paid N/A
Net assets, ending (in thousands) $560,981
Number of shares outstanding,
ending (in thousands) 17,099
Years Ended
September 30, September 30,
Class A Shares 1994 1993
Net asset value, beginning $30.85 $29.35
Income from investment operations
Net investment income .93 .95
Net realized and unrealized gain (loss)(1.83) 1.91
Total from investment operations (.90) 2.86
Distributions from
Net investment income (.95) (.95)
Net realized gain (.23) (.41)
Total distributions (1.18) (1.36)
Total increase (decrease) in net
asset value (2.08) 1.50
Net asset value, ending $28.77 $30.85
Total return* (2.95%) 9.98%
Ratios to average net assets:
Net investment income 3.14% 3.25%
Total expenses~ N/A N/A
Net expenses 1.24% 1.25%
Expenses reimbursed - -
Portfolio turnover 34% 33%
Average commission rate paid N/A N/A
Net assets, ending (in thousands) $512,027 $536,170
Number of shares outstanding,
ending (in thousands) 17,800 17,378
<PAGE>
MANAGED GROWTH PORTFOLIO
FINANCIAL HIGHLIGHTS
Years Ended
September 30, September 30,
Class C Shares 1997 1996
Net asset value, beginning $31.05 $32.60
Income from investment operations
Net investment income .47 .46
Net realized and unrealized gain (loss)5.54 2.17
Total from investment operations 6.01 2.63
Distributions from
Net investment income (.44) (.43)
Net realized gain (2.10) (3.75)
Total distributions (2.54) (4.18)
Total increase (decrease) in
net asset value 3.47 (1.55)
Net asset value, ending $34.52 $31.05
Total return* 20.56% 8.85%
Ratios to average net assets:
Net investment income 1.42% 1.34%
Total expenses~ 2.29% 2.52%
Net expenses 2.27% 2.50%
Expenses reimbursed - .14%
Portfolio turnover 215% 111%
Average commission rate paid $.0508 $.0489
Net assets, ending (in thousands) $8,898 $6,715
Number of shares outstanding,
ending (in thousands) 258 216
Years Ended
September 30, September 30,
Class C Shares 1995 1994**
Net asset value, beginning $28.65 $30.43
Income from investment operations
Net investment income .54 .51
Net realized and unrealized gain (loss)4.20 (1.66)
Total from investment operations 4.74 (1.15)
Distributions from
Net investment income (.58) (.63)
Net realized gain (.21) -
Total distributions (.79) (.63)
Total increase (decrease) in
net asset value 3.95 (1.78)
Net asset value, ending $32.60 $28.65
Total return* 16.85% (3.30%)
Ratios to average net assets:
Net investment income 1.61% 1.83%(a)
Total expenses~ 2.51% N/A
Net expenses 2.50% 2.47%(a)
Expenses reimbursed .42% 1.46%(a)
Portfolio turnover 114% 34%
Average commission rate paid N/A N/A
Net assets, ending (in thousands) $4,065 $1,893
Number of shares outstanding,
ending (in thousands) 125 66
<PAGE>
BOND PORTFOLIO
FINANCIAL HIGHLIGHTS
Years Ended
September 30, September 30,
Class A Shares 1997 1996
Net asset value, beginning $16.06 $16.34
Income from investment operations
Net investment income .96 .92
Net realized and unrealized gain (loss).58 (.29)
Total from investment operations 1.54 .63
Distributions from
Net investment income (.96) (.91)
Net realized gain - -
Tax return of capital - -
Total distributions (.96) (.91)
Total increase (decrease) in
net asset value .58 (.28)
Net asset value, ending $16.64 $16.06
Total return* 9.89% 3.96%
Ratios to average net assets:
Net investment income 5.85% 5.60%
Total expenses~ 1.23% 1.29%
Net expenses 1.19% 1.26%
Portfolio turnover 319% 22%29%
Net assets, ending (in thousands) $59,656 $62,259
Number of shares outstanding,
ending (in thousands) 3,585 3,876
<PAGE>
BOND PORTFOLIO
FINANCIAL HIGHLIGHTS
Years Ended September 30,
1995
Class A Shares
Net asset value, beginning $15.49
Income from investment operations
Net investment income .96
Net realized and unrealized gain (loss) .91
Total from investment operations 1.87
Distributions from
Net investment income (.93)
Net realized gain (.06)
Tax return of capital (.03)
Total distributions (1.02)
Total increase (decrease) in
net asset value .85
Net asset value, ending $16.34
Total return* 12.57%
Ratios to average net assets:
Net investment income 6.04%
Total expenses~ 1.24%
Net expenses 1.22%
Portfolio turnover
Net assets, ending (in thousands) $62,929
Number of shares outstanding,
ending (in thousands) 3,850
Years Ended
September 30, September 30,
Class A Shares 1994 1993
Net asset value, beginning $17.77 $17.05
Income from investment operations
Net investment income .94 1.08
Net realized and unrealized gain (loss)(1.81) .85
Total from investment operations (.87) 1.93
Distributions from
Net investment income (.94) (1.08)
Net realized gain (.47) (.13)
Tax return of capital -
Total distributions (1.41) (1.21)
Total increase (decrease) in
net asset value (2.28) .72
Net asset value, ending $15.49 $17.77
Total return* (5.18%) 11.89%
Ratios to average net assets:
Net investment income 5.64% 6.33%
Total expenses~ N/A N/A
Net expenses 1.10% .79%
Expenses reimbursed - .20%
Portfolio turnover 19% 28%
Net assets, ending (in thousands) $61,573 $67,134
Number of shares outstanding,
ending (in thousands) 3,976 3,778
<PAGE>
BOND PORTFOLIO
FINANCIAL HIGHLIGHTS
Periods Ended
October 29, September 30,
Class C Shares 1996 1996
Net asset value, beginning $15.90 $16.20
Income from investment operations
Net investment income .06 .72
Net realized and unrealized gain (loss).21 (.31)
Total from investment operations .27 .41
Distributions from
Net investment income (.05) (.71)
Net realized gain - -
Tax return of capital - -
Total distributions (.05) (.71)
Total increase (decrease) in
net asset value .22 (.30)
Net asset value, ending $16.12 $15.90
Total return* 1.73% 2.58%
Ratios to average net assets:
Net investment income 4.84%(a) 4.18%
Total expenses~ 2.56%(a) 2.53%
Net expenses 2.51%(a) 2.50%
Expenses reimbursed .96%(a) .75%
Portfolio turnover 0% 22%
Net assets, ending (in thousands) $1,427 $1,441
Number of shares outstanding,
ending (in thousands) 89 91
Years Ended
September 30, September 30,
Class C Shares 1995 1994**
Net asset value, beginning $15.43 $16.71
Income from investment operations
Net investment income .80 .45
Net realized and unrealized gain (loss).87 (1.23)
Total from investment operations 1.67 (.78)
Distributions from
Net investment income (.81) (.50)
Net realized gain (.06) -
Tax return of capital (.03) -
Total distributions (.90) (.50)
Total increase (decrease) in net
asset value .77 (1.28)
Net asset value, ending $16.20 $15.43
Total return* 11.21% (4.13%)
Ratios to average net assets:
Net investment income 4.60% 4.63%(a)
Total expenses 2.52% N/A
Net expenses 2.50% 2.41%(a)
Expenses reimbursed 2.14% 9.60%(a)
Portfolio turnover 29% 19%
Net assets, ending (in thousands) $910 $315
Number of shares outstanding,
ending (in thousands) 56 20
<PAGE>
Equity Portfolio
Financial Highlights
Years Ended
Sept. 30, Sept. 30
Class A Shares 1997 1996
Net asset value, beginning $22.54 $21.12
Income from investment operations
Net investment income - .03
Net realized and unrealized gain (loss)6.73 3.26
Total from investment operations 6.73 3.29
Distributions from
Net investment income (.01) (.06)
Net realized gain (1.49) (1.81)
Total distributions (1.50) (1.87)
Total increase (decrease) in net
asset value 5.23 1.42
Net asset value, ending $27.77 $22.54
Total return* 31.34% 16.62%
Ratios to average net assets:
Net investment income .03% .15%
Total expenses~ 1.21% 1.29%
Net expenses 1.20% 1.27%
Portfolio turnover 93% 118%
Average commission rate paid $.0574 $.0556
Net assets, ending (in thousands) $147,002 $101,344
Number of shares outstanding,
ending (in thousands) 5,294 4,496
<PAGE>
Equity Portfolio
Financial Highlights
Years Ended
September 30,
1995
Class A Shares
Net asset value, beginning $20.13
Income from investment operations
Net investment income .06
Net realized and unrealized gain (loss) 2.22
Total from investment operations 2.28
Distributions from
Net investment income (.04)
Net realized gain (1.25)
Total distributions (1.29)
Total increase (decrease) in
net asset value .99
Net asset value, ending $21.12
Total return* 12.43%
Ratios to average net assets:
Net investment income .32%
Total expenses~ 1.38%
Net expenses 1.36%
Portfolio turnover 35%
Average commission rate paid N/A
Net assets, ending (in thousands) $90,951
Number of shares outstanding
ending (in thousands) 4,307
Years Ended
Sept. 30, Sept. 30,
Class A Shares 1994 1993
Net asset value, beginning $21.43 $20.03
Income from investment operations
Net investment income .13 .21
Net realized and unrealized gain (loss) (1.04) 1.36
Total from investment operations (.91) 1.57
Distributions from
Net investment income (.28) (.17)
Net realized gain (.11) -
Total distributions (.39) (.17)
Total increase (decrease) in net
asset value (1.30) 1.40
Net asset value, ending $20.13 $21.43
Total return* (4.33%) 7.82%
Ratios to average net assets:
Net investment income .65% 1.06%
Total expenses~ N/A N/A
Net expenses 1.27% 1.13%
Expenses reimbursed - -
Portfolio turnover 94% 43%
Average commission rate paid N/A N/A
Net assets, ending (in thousands) $92,970 $85,042
Number of shares outstanding,
ending (in thousands) 4,620 3,968
<PAGE>
EQUITY PORTFOLIO
FINANCIAL HIGHLIGHTS
Years Ended
September 30, September 30,
Class C Shares 1997 1996
Net asset value, beginning $21.71 $20.66
Income from investment operations.
Net investment income (loss) (.05) (.16)
Net realized and unrealized gain (loss)6.21 3.04
Total from investment operations 6.16 2.88
Distributions from
Net investment income (.01) (.02)
Net realized gain (1.49) (1.81)
Total distributions (1.50) (1.83)
Total increase (decrease) in
net asset value 4.66 1.05
Net asset value, ending $26.37 $21.71
Total return* 29.84% 14.85%
Ratios to average net assets:
Net investment income (loss) (1.08%) (1.42%)
Total expenses~ 2.31% 2.86%
Net expenses 2.30% 2.85%
Expenses reimbursed - -
Portfolio turnover 93% 118%
Average commission rate paid $.0574 $.0556
Net assets, ending (in thousands) $6,249 $2,996
Number of shares outstanding,
ending (in thousands) 237 138
<PAGE>
Years Ended
September 30, September 30,
Class C Shares 1995 1994**
Net asset value, beginning $19.98 $22.12
Income from investment operations.
Net investment income (.03) (.06)
Net realized and unrealized gain (loss) 2.05 (2.08)
Total from investment operations 2.02 (2.14)
Distributions from
Net investment income (.09) -
Net realized gain (1.25) -
Total distributions (1.34) -
Total increase (decrease) in net
asset value .68 (2.14)
Net asset value, ending $20.66 $19.98
Total return* 11.16% (9.14%)
Ratios to average net assets:
Net investment income (loss) (.84%) (1.06%)(a)
Total expenses~ 2.51% N/A
Net expenses 2.50% 2.75%(a)
Expenses reimbursed 1.07% 4.60%(a)
Portfolio turnover 35% 94%
Average commission rate paid N/A N/A
Net assets, ending (in thousands) $1,802 $670
Number of shares outstanding,
ending (in thousands) 87 34
(a) Annualized
* Total return is not annualized for periods less than one
year and does not reflect deduction of Class A front-end sales charge.
+ Effective September 30, 1995, this ratio reflects total expenses before
reduction for fees paid indirectly; such reductions are included in the ratio of
net expenses.
** From March 1, 1994 inception. N/A Disclosure not applicable to
prior periods.
N/A Disclosure not applicable to prior periods.
Calvert Group's
Family of Funds
Tax-Exempt
Money Market Funds
CTFR Money Market Portfolio
CTFR California Money Market Portfolio
Taxable
Money Market Funds
First Government Money Market Fund
CSIF Money Market Portfolio
Balanced Fund
CSIF Managed Growth Portfolio
Municipal Funds
CTFRLimited-Term Portfolio
CTFR Long-Term Portfolio
CTFR Vermont Municipal Portfolio
National Muni. Intermediate Portfolio
Arizona Muni. Intermediate Portfolio
California Muni. Intermediate Portfolio
Florida Muni. Intermediate Portfolio
Maryland Muni. Intermediate Portfolio
Michigan Muni. Intermediate Portfolio
New York Muni. Intermediate Portfolio
Pennsylvania Muni. Intermediate Portfolio
Virginia Muni. Intermediate Portfolio
Taxable Bond Funds
CSIF Bond Portfolio
Income Fund
Equity Funds
CSIFEquity Portfolio
Capital Accumulation Fund
CWV International Equity Fund
New Vision Small Cap Fund
Strategic Growth Fund
New Africa Fund
<PAGE>
Calvert Group
INformation
To Open an Account
800-368-2748
Yields and Prices
Calvert Information Network
(24 hours, 7 days a week)
800-368-2745
Service for Existing Account
Shareholders: 800-368-2745
Brokers: 800-368-2746
TDDfor Hearing Impaired
800-541-1524
Branch Office
4550 Montgomery Avenue
Suite 1000 North
Bethesda, Maryland 20814
Registered, Certified
or Overnight Mail
Calvert Group
c/o NFDS, 6th Floor
1004 Baltimore
Kansas City, MO 64105-1807
Web Site
http://www.calvertgroup.com
Please check the inside back cover for
Calvert Group's Family of Funds.
This report is intended to provide fund
information to shareholders. It is not authorized
for distribution to prospective investors unless
preceded or accompanied by a prospectus.
<PAGE>
Calvert Group
INformation
To Open an Account
800-368-2748
Yields and Prices
Calvert Information Network
(24 hours, 7 days a week)
800-368-2745
Service for Existing Account
Shareholders: 800-368-2745
Brokers: 800-368-2746
TDDfor Hearing Impaired
800-541-1524
Branch Office
4550 Montgomery Avenue
Suite 1000 North
Bethesda, Maryland 20814
Registered, Certified
or Overnight Mail
Calvert Group
c/o NFDS, 6th Floor
1004 Baltimore
Kansas City, MO 64105-1807
Web Site
http://www.calvertgroup.com
Please check the inside back cover for
Calvert Group's Family of Funds.
This report is intended to provide fund
information to shareholders. It is not authorized
for distribution to prospective investors unless
preceded or accompanied by a prospectus.
<PAGE>
Portfolio Quality Structure
Money Market Portfolio Statistics
September 30, 1997
Average Annual Total Returns
as of 9/30/97
One year 4.89%
Five year 4.12%
Ten year 5.39%
Since inception 6.28%
(10/21/82)
Long-Term Performance
Change in value of $10,000 investment.
Line graph here showing comparison from 10/87 to 9/97
CSIF $16,907
Total return assumes reinvestment of dividends. Past performance is no guarantee
of future results.
<PAGE>
Shareholder Dialogue with Oracle Corporation In April of this year, Calvert
filed a shareholder resolution requesting that the management of Oracle
Corporation prepare and disseminate to all employees and shareholders a report
detailing the software company's EEO programs and policies, including the
company's Federal EEO-1 report for the most recent three years. After extensive
negotiations and dialogue between Calvert and Oracle management, the company
agreed to prepare and publish a diversity report by March 1998. Oracle will also
publish its diversity initiatives on its web site. Based on the terms of the
withdrawal agreement, Calvert withdrew its resolution. We applaud this step by
Oracle toward increased accountability on equal opportunity employment issues.
Calvert Special Equities Program We continue to see exciting social and
financial results from our early-stage investment program. Highlights in the
past six months include the successful trial results of Aviron's nasal flu
vaccine for children. Another notable development is the acquisition of
Fountainhead, a maker of chlorine-free pool filters, by Zodiac, one of the
largest swimming pool companies in the world. New investments made within the
past year include Hayes Medical, a developer of 3-D technology for
better-fitting, cheaper prosthetics and Real Goods, a retailer of renewable
energy and sustainable living products. High Social Impact Investing Finally, an
important part of our investment approach is the one percent of assets we invest
at less-than-market returns in community initiatives. One such investment is the
Northeast Entrepreneur Fund which helps hundreds of people in Minnesota focus
their talents, determination and dreams into sensible plans and successful
businesses. One notable success story is Don Young, a resident of a remote
community in Northern Minnesota, who managed to get his family of twelve off
welfare by turning his woodworking hobby into a thriving commercial operation,
thanks to a lot of hard work-and the help of a micro-loan.
As always, more information about the Fund, including the article from the
Journal of Investing, is available on the Internet at www.calvertsif.com.
Investment performance is for Class A shares and does not reflect the deduction
of any front-end sales charge. TR represents total return. Source: Lipper
Analytical Services, Inc. New subadvisors assumed management of the equity
portion of the Portfolio effective July 1995.
<PAGE>
