March 31, 1999
Semi-Annual
Report
CALVERT SOCIAL
INVESTMENT FUND
<PAGE>
Calvert Social
Investment Fund
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Calvert Group
c/o NFDS
330 West 9th Street
Kansas City, MO 64105
Web Site
http://www.calvertgroup.com
Principal Underwriter
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000 North
Bethesda, Maryland 20814
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.
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 Balanced Portfolio
Municipal Funds
CTFR Limited-Term Portfolio
CTFR Long-Term Portfolio
CTFR Vermont Municipal Portfolio
National Muni. Intermediate Portfolio
California Muni. Intermediate Portfolio
Maryland Muni. Intermediate Portfolio
Virginia Muni. Intermediate Portfolio
Taxable Bond Funds
CSIF Bond Portfolio
Income Fund
Equity Funds
CSIF Managed Index Portfolio
CSIF Equity Portfolio
Capital Accumulation Fund
CWV International Equity Fund
New Vision Small Cap Fund
New Africa Fund
printed on recycled paper
using soy-based inks
<PAGE>
Table
of
Contents
President's Letter
1
Social Update
2
Portfolio
Manager Remarks
4
Portfolio
of Investments
18
Statements
of Assets and Liabilities
36
Statements
of Operations
38
Statements
of Changes in
Net Assets
40
Notes to
Financial Statements
49
Financial Highlights
54
Shareholder Meeting Update
66
Y2K Update
69
[photo of Barbara Krumsiek, no caption]
Dear Shareholders:
The stock market appears to be on its way to a fifth straight year of 20%
plus returns. The pundits are running out of superlatives. The Dow Jones
Industrial Average produced a total return of 25.86%, closing-in on a
record-breaking 10,000 level near the end of the March quarter. The NASDAQ
Composite index, supercharged by the technology sector, generated a total
return of 45.57% over the same six-month period.
The current economic environment for investors is exceedingly positive.
Interest rates and inflationary expectations are low and the US economy
remains in an expansion mode. The world's largest economy is now in its
fifth year of GDP growth in excess of 4%.
Among stocks, the top performers were tightly consolidated by capitalization
range and industry group. Large-capitalization companies and technology
plays fueled most of the advance. In the bond market, long-term US Treasury
securities outperformed other categories substantially.
While investors may be tempted to chase the current trend setters, that
approach comes with increased risk now, given the stock market's high levels
and increased volatility. We encourage investors to make decisions based on
their financial objectives and tolerance for risk. At this point, it would
be a good idea to reevaluate your asset allocation to be sure you are
positioned at a comfortable risk level. If you think change is in order,
your financial professional can suggest strategies that keep you on track to
meet long-term financial objectives without exposing you to undue levels of
risk.
We appreciate your investment in Calvert Group funds and look forward to
providing competitive returns in the months ahead.
Sincerely,
/s/
Barbara J. Krumsiek
President and CEO
April 28, 1999
<PAGE>
Social
Update
Social Change and the Rights of Indigenous Peoples
The Calvert Social Investment Fund Advisory Council, which advises the Fund
on social policy issues, is exploring a new area of social change - the
rights of indigenous peoples. Shareholders were mailed a copy of an
interview on this topic with Calvert Social Investment Fund Trustee Rebecca
Adamson, whose pioneering work with Native Americans on land rights issues
and economic independence is widely recognized around the world. We will
continue to keep you updated as the Fund examines this complex issue. The
interview with Rebecca Adamson is available on our website at
www.calvertgroup.com. Other highlights on our website feature a segment on
shareholder resolutions and important labor and human rights issues. This
segment talks about the current debate surrounding sweatshops and global
warming as well as the companies that have recently received resolutions.
Calvert Redesigns Its Web Site
Calvert Group unveiled its newly redesigned Web site. The redesigned Web
site uses leading edge technology to make information easily accessible to
investment professionals, individual investors and institutional investors.
Some of the key features include information such as performance, profiles,
literature, and audio manager updates. Performance and account information
are updated daily. We have several tools designed to educate the investor,
including our "Know What You Own (r)" service which allows individuals to
find out the stocks held by their mutual funds. We also offer a section
explaining climate change and supplier standards that explains how people
can make an impact on companies through proxy voting and the shareholder
resolution process. Comprehensive information is also available on socially
responsible and tax-free investing. Our mutual fund basics section offers an
array of tools to help individuals make important decisions regarding their
financial future. Please visit us at www.calvertgroup.com and learn more
about how Calvert Group can meet your needs.
Shareholder Actions
In May 1998, following the announcement of the NationsBank-BankAmerica
merger, BankAmerica pledged to provide $350 billion for community
development lending and investment during the next ten years. Calvert has
been in extensive dialogue with management regarding the implementation of
the company's community investment initiatives. We were not satisfied with
the company's response. In November 1998, Calvert joined with the Interfaith
Center for Corporate Responsibility to co-file a shareholder resolution
regarding the implementation of these initiatives. In response, management
agreed to meet with us to address our concerns. Following a meeting in San
Francisco with management in January 1999, Calvert withdrew the resolution,
after reaching an agreement on the resolution's core issues: meeting
minority and low income mortgage lending benchmarks, issuing annual
community reinvestment reports, and making progress reports at semi-annual
meetings.
Calvert filed a resolution with a group of social and religious
institutional investors for the second year in a row with Home Depot. Last
October, Calvert met with management to discuss disclosing the company's
equal employment opportunity date by race, gender and job classification.
Dissatisfied with management's response, we decided to resubmit the EEO
disclosure resolution. Home Depot agreed to include our resolution in the
company's proxy for the second year. The resolution is scheduled for a May
1999 vote at the company's annual shareholder meeting.
We also filed a resolution with Dollar General in response to management's
policy against disclosing EEO data. Although management refuses to discuss
this issue with us, we are impressed with the company's commitment to
low-income communities. This resolution is scheduled for June 1999 at the
annual shareholders meeting.
Special Equities Highlights
The Fund continues to support new private companies and projects that are
not available on the stock markets. Wild Planet Toys, an investment that we
added to in the last year, is a company that makes "environmentally cool"
toys. Wild Planet recently acquired a very exciting company started by a ten
year old boy and his mother. The acquisition allowed Wild Planet to enter a
new category of toys - underwater walkie talkies. This acquisition resulted
in international media attention and bolstered the awareness of the company
and its products overall. Wild Planet is also thrilled to be able to
champion a boy who is an inspiration to teens across America.
High Social Impact Investments
High Social Impact Investments make targeted, direct investments in the
lives of people and their communities. It's helping people like Merlinda. As
a child, Merlinda's father told her, "If there's something you want, learn
to make it." So she did. When financial crisis struck, Merlinda took her
grandmother's chili recipe and began cooking. A loan of $500 from ACCION New
Mexico allowed her to can her salsa as well, doubling her sales. Merlinda
says, "that $500 was worth a million." ACCION helps microentrepreneurs start
and grow their businesses in the United States and Latin America. Calvert
has been supporting ACCION to reach out to new entrepreneurs since 1991.
<PAGE>
[photo of B.B. Hunter, no caption]
Beth Bunnell Hunter
of Calvert Asset Management Company
What were the key factors in fixed income markets during the past six months?
Since our last report, the world economic crisis, which sparked three
sequential 25 basis point easings of the Federal funds rate, has abated.
Although concerns over troubled world economies still exist, the market
panic that sparked global liquidity problems last fall has all but
disappeared from the market radar screens. However, in our
never-a-dull-moment world, we now are contending with the conflict in Kosovo
and concerns over escalation of that war will be one factor which will
likely influence the market in the days ahead.
In addition to world events, market technicals such as the continuing pay
down of US treasury bills have continued to support bill prices and
consequently to apply downward pressure on yields. Combining this with the
two Fed funds easings, which happened after the close of our last report,
has created an environment in which money market yields are significantly
lower than those of last September.
What was your strategy during the period?
Because we did anticipate a continuation of the lowering of the Fed funds
rate, we continued to extend our average days to maturity throughout the
final months of 1998, to lock in higher rates wherever possible. On March
31, 1999, our average days to maturity was 42 days, versus 36 days on
September 30, 1998.
How did the Fund perform?
For the six month period ending March 31, 1999 the Fund's return was 2.28%
versus the Lipper Money Market Funds average of 2.20%.
What is your outlook?
It appears the Federal Reserve Board has retreated to the sidelines for the
moment and has returned to looking at inflationary trends rather than world
liquidity as the primary determinant of the direction of future interest
rates. While the Fed has been neutral over the past few meetings, many
participants in the market place think it likely that the Fed's next move
may be to hike the rate up by 25 basis points sometime later this year.
Inflation in certain areas, such as crude oil prices, has been notable over
the past few months, although areas such as the consumer price index remain
stable. We will continue to monitor these developments and adjust investment
strategy as needed over the coming six months.
April 28, 1999
Money Market Portfolio Statistics
March 31, 1999
Investment Performance
6 Months 12 Months
ended ended
3/31/99 3/31/99
Money Market Portfolio 2.28% 4.80%
Lipper Money
Market Funds Average 2.20% 4.70%
Maturity Schedule
Weighted Average
3/31/99 9/30/98
42 days 36 days
Portfolio Quality Structure
First Tier 100%
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.
Money Market Portfolio Statistics
March 31, 1999
Average Annual Total Returns
as of 3/31/99
One year 4.80%
Five year 4.81%
Ten year 5.03%
Since inception 6.15%
(10/21/82)
Total return assumes reinvestment of dividends. Past performance is no
guarantee of future results.
<PAGE>
[photo of J. Nichols]
CAMCO
Vice President
of Equities, John Nichols
What were the key factors in stock and bond market performance?
Large caps continue to dominate small and mid-cap equities and growth
continues to outpace value. The S&P 500, representative of large cap stocks,
gained 4.98% and 27.34% during the quarter and trailing six-month period,
respectively. Small cap stocks as reflected by the Russell 2000 lost 5.44%
in the first quarter and gained only 10.13% over the six-month period. The
S&P Barra Growth Index rose 6.86% in the first quarter and returned over 33%
since the end of September. This compares to a gain of 2.85% and 20.76% in
the first quarter and six-month period for the S&P Barra Value Index.
The primary drivers of the market's advance were the three interest-rate
cuts by the Federal Reserve. As noted in the year-end review, the stock
market experienced many gyrations throughout the course of 1998. After
suffering one of the worse months in stock market history in August 1998,
the market was poised to regain lost ground in the fourth quarter.
The credit markets rallied significantly over the last six months as the
one-year bear market in the spread between non-government bonds and Treasury
bonds came to a screeching halt. When market participants became comfortable
with the idea that the Russian debacle was not necessarily going to be
repeated in other parts of the world, they started to purchase
non-government bonds. The flight to quality reversed itself as Treasury
yields rose significantly.
The Federal Reserve announced the first of three interest rate cuts on
September 29. The cuts came on the heels of investors' concern that
corporate profits would be flat. Profitability in general had been pressured
by turmoil in overseas markets, including Southeast Asia, Latin America and
Russia. The impeachment trial of President Clinton and the bombing of Iraq
also did not make for a stable market environment.
What strategy was utilized by the fixed-income manager?
When the new issue market revived after a two-month hiatus in August and
September, Calvert Asset Management Company, Inc. ("CAMCO"), became active
participants and purchased numerous new bond issues which came with generous
compensatory concessions to the secondary market. As CAMCO's activities
increased, the returns improved.
The fixed-income component of the Balanced Portfolio handsomely outperformed
its Lehman benchmark over the last six months by over 250 basis points. With
the recovery in spreads in the taxable bond market, CAMCO has assumed a more
defensive stance in our position with a mild credit upgrade of our holdings.
CAMCO believes that single A bonds are, as a class, rich (overvalued)
relative to both higher and lower rated bonds. For that reason, CAMCO has
sold many single A holdings and purchased higher and lower rated bonds.
And on the equity side?
NCM Capital positioned their portion of the Portfolio defensively going into
the fourth quarter. They reduced their weighting within the highly volatile
technology group for fear the stocks would self-destruct as investors sought
out more predictable and less economically sensitive sectors. They
gravitated towards healthcare and domestic consumer staples while avoiding
industries tied to depressed commodity prices such as basic materials and
energy. The majority of their sector decisions proved to be the right ones
with the exception of under-weighting technology. The technology sector not
only proved to be the best performing sector in 1998, but was also the
strongest performing group in the fourth quarter. Consequently, as the
market began to react positively to the Fed's rate cuts in October, the
Portfolio under-performed materially. NCM was able to make up the majority
of the lost ground by the end of the fourth period. They repositioned the
Portfolio more aggressively towards the end of October, once they realized
the Fed action in late September would be followed by additional rate cuts
throughout the course of the quarter.
Brown Capital Management held to their bottom-up, fundamental approach to
finding the most promising opportunities that are also selling at reasonable
prices.
Environmental factors remain quite positive. The strength, breadth and depth
of the US economy at this stage of the business cycle are extraordinary.
Employment, production, income and spending are robust. The US is in the
midst of one of the longest economic expansions in its history. While uneven
patterns in other economies are tempering global expansion, they do help to
keep inflationary pressure in check. Brown Capital Management sees no
evidence of an overheated economic environment but are less than sanguine
that a rational case can be made for continuation of unprecedented
investment returns. Their valuation discipline, which allows for generally
higher P/E ratios in periods of low interest rates, indicates limited
near-term appreciation potential for the market's larger cap indices. A
stronger case can be made for individual companies of any size that maintain
growth.
Brown's valuation discipline treats the five-year Treasury bond as the
riskless asset and assigns appropriate risk premiums to individual
companies. The other crucial variable in Brown's model is the expected
earnings growth rate. Interest rates and risk premiums for many large
companies are at historically low levels and we do not think they will be
key catalysts for near-term price appreciation. Therefore the more important
variable in the current environment is expected earnings growth. In
contrast, risk premiums for midcap companies are at historically high levels
and Brown thinks that they will likely be a key catalysts for price
appreciation over both the short and long term.
Has the market effectively measured the effects of the Y2K problem?
Y2K issues could be the very catalysts to change the market environment as
we progress through 1999. Most of the large capitalized companies in the US
have made significant capital investment to become Y2K compliant by
year-end. Our major concern as it relates to Y2K pertains more to the
foreign vendor relationships most multinational companies have. While I do
not foresee a problem with large US companies becoming compliant by
year-end, those companies that have relationships with companies in emerging
markets may experience some difficulty. However, it is also important to
note that many emerging countries are more labor intensive and less
technology exposed than the developed nations. In any event, the equity
markets may indeed become spooked as we approach the unknown. We will keep
abreast of any changes in market sentiment as such events typically create
attractive buying opportunities.
What is your outlook for the financial markets in the months ahead?
As we look out to the second half of the fiscal year we remain somewhat
cautious. The equity markets are expensive despite the low level of interest
rates. The 30-year rate has actually backed up this year, which, generally
speaking, spells bad news for stocks. It is very difficult to predict a
change in the economic environment or a change in the stock market. Thus, we
will continue to focus on good stock selection.
With the ongoing paydown of Treasury securities, there has been a hearty
appetite for all spread product. We would expect this trend to continue as
long as there are no negative fundamental developments in the troubled
economies of Asia and Latin America.
April 28, 1999
Balanced Portfolio Statistics
March 31, 1999
Investment Performance
6 Months 12 Months
ended ended
3/31/99 3/31/99
Class A 14.61% 9.45%
Class B 13.84% 8.03%
Class C 14.08% 8.31%
Class I N/A N/A
Lehman Aggregate
Bond Index TR (0.16)% 6.49%
S&P 500 Index
Mthly. Reinvested 27.32% 18.49%
Lipper Balanced
Funds Average 12.58% 6.47%
Ten Largest Long-Term Holdings
% of Net Assets
Microsoft Corp. 2.59%
Merck & Co. 1.88%
IBM Corp. 1.77%
EMC Corp. 1.74%
Onbank Capital Trust I,
9.25%, 2/2/27 1.64%
Cardinal Health, Inc. 1.60%
Tellabs, Inc. 1.40%
MCI Worldcom, Inc. 1.37%
American International Group 1.30%
Gillette Co. 1.30%
Total 16.59%
Investment performance does not reflect the deduction of any front-end or
deferred 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.
Balanced Portfolio Statistics
March 31, 1999
Average Annual Total Returns
Class A Shares
as of 3/31/99
One year 4.26%
Five year 12.74%
Ten year 10.74%
Since inception 11.72%
(10/21/82)
Class B Shares
as of 3/31/99
One year 3.03%
Since inception 3.03%
(4/1/98)
Class C Shares
as of 3/31/99
One year 8.31%
Five years 12.55%
Since inception 11.54%
(3/1/94)
Class I Shares
as of 3/31/99
Since inception N/A
(3/1/99)
Performance Comparison
Comparison of change in value of $10,000
investment. (Source: Lipper Analytical Services, Inc.)
[LINE GRAPH HERE]
CSIF Balanced Portfolio $28,015
Lehman Aggregate Bond Index TR $23,848
S&P 500 Monthly Reinvest $56,725
Lipper Balanced Funds Index $34,102
Total returns assume reinvestment of dividends and reflect the deduction of
the Fund's maximum front-end or deferred sales charge. No sales charge has
been applied to the index used for comparison. Past performance is no
guarantee of future results. The value of an investment in Class A shares is
plotted in the line graph. The value of an investment in another class of
shares would be different.
Balanced Portfolio Statistics
March 31, 1999
Asset Allocation
Stocks 62%
Bonds 35%
Cash & Cash Equivalents 3%
100%
Top Five Economic Sectors
(Equity Holdings)
% of Equity Holdings
Technology 28.25%
Financial Services 20.42%
Health Care 17.42%
Retail 10.10%
Business Equip. and Services 6.44%
Portfolio Statistics
March 31, 1999
Portfolio Characteristics
(Equity holdings)
CSIF S&P
Balanced 500
Portfolio Index
Number of Stocks 80 500
Median Market
Capitalization ($bil) 38.11 64.74
(by portfolio weight)
Price/Earnings
Ratio 42.67 31.12
Earnings Per Share
Growth 25.16% 17.66%
Yield 0.55% 1.26%
(return on capital investment)
Volatility Measures
CSIF S&P
Balanced 500
Portfolio Index
Beta1 1.09 1.00
R-Squared2 0.97 1.00
1 Measure of volatility compared to the S&P 500 Stock Index (S&P 500) beta
of 1. The higher the beta, the higher the risk and potential reward.
2 Measure of correlation between the fund's returns and the overall market's
(S&P 500) returns. An R-Squared of 0 would mean no correlation, an R-Squared
of 1 would mean total correlation.
Source: Vestek
<PAGE>
[photo of G. Habeeb]
Greg Habeeb
of Calvert Asset Management Company
What were the driving forces in the credit markets?
The credit markets rallied significantly over the last six months as the
one-year bear market in the spread between non-government bonds and Treasury
bonds came to a screeching halt. When market participants became comfortable
with the idea that the Russian debacle was not necessarily going to be
repeated in other parts of the world, they started to purchase
non-government bonds. The flight to quality reversed itself as Treasury
yields rose significantly.
Institutions followed suit by issuing large amounts of bonds, including a
record number of billion dollar plus deals. Right through the end of the
first quarter of 1999, these deals have been extremely well received.
What was your strategy?
When spreads widened significantly, we purchased some of the more
out-of-favor names and/or structures (step-up bonds, trust preferreds,
Japanese banks, etc.) aggressively at semi-distressed levels. We were also
extremely active in the new issue market since most such bond offerings came
with generous concessions to the marketplace. Combined with our normal style
of relative value trading, our activity increased dramatically and our
turnover rose. It is our belief that single A bonds are, as a class, rich
(overvalued) relative to both higher and lower rated bonds. For that reason,
we have sold many of our single A holdings and purchased higher and lower
rated bonds.
How did the Fund perform relative to its peer group?
Our active management style paid off handsomely as the CSIF Bond portfolio
significantly outperformed both the Lipper Corporate Debt Funds A rated
Average and the Lehman Aggregate Bond Index over the last six months.
What should investors expect in the coming months?
Currently the Treasury market has entered a trading range with Federal
Reserve policy in neutral. Continued low inflation eliminates the need for a
tighter policy and an economy that seems to be expanding eliminates the need
for any stimulating rate cuts. In this environment, the credit markets
appear stable.
With the ongoing paydown of Treasury securities, there has been a hearty
appetite for all spread product. We would expect this trend to continue as
long as there are no negative fundamental developments in the troubled
economies of Asia and Latin America. However, we continue to be somewhat
defensive in our portfolio management style because of global risks.
April 28, 1999
Bond
Portfolio Statistics
March 31, 1999
Investment Performance
6 Months 12 Months
ended ended
3/31/99 3/31/99
Class A 0.85% 4.91%
Class B 0.14% 3.51%
Class C 0.10% N/A
Lehman Aggregate
Bond Index TR (0.16)% 6.49%
Lipper Corporate
Debt Funds
A Rated Average (0.96)% 5.03%
Maturity Schedule
Weighted Average
3/31/99 9/30/98
13 years 13 years
SEC Yields
30 days ended
3/31/99 9/30/98
Class A 5.53% 5.56%
Class B 4.31% 4.33%
Class C 4.33% 4.36%
Portfolio Quality Structure
AAA 35%
AA 10%
A 23%
BBB 29%
BB 3%
B --
NR --
Cash & Cash Equivalents --
100%
Investment performance does not reflect the deduction of any front-end or
deferred sales charge.
TR represents total return.
Source: Lipper Analytical Services, Inc.
Bond
Portfolio Statistics
March 31, 1999
Average Annual Total Returns
Class A Shares
as of 3/31/99
One year 0.98%
Five year 5.81%
Ten year 7.88%
Since inception 7.97%
(8/24/87)
Class B Shares
as of 3/31/99
One year (0.49)%
Since inception (0.49)%
(4/1/98)
Class C Shares
as of 3/31/99
Since inception 0.97%
(6/1/98)
Performance Comparison
Comparison of change in value of $10,000 investment. (Source: Lipper
Analytical Services, Inc.)
[LINE GRAPH HERE]
CSIF Bond Portfolio $21,482
Lehman Aggregate Bond Index TR $23,848
Lipper Corp. Debt Funds A Rated Index $22,949
Total returns assume reinvestment of dividends and reflect the deduction of
the Fund's maximum front-end or deferred sales charge. 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 another class of
shares would be different.
<PAGE>
[photo of D. Boone]
Dan Boone
of Atlanta Capital
Management
How have different types of stocks or investment styles fared in the market
run up to the Dow 10,000?
During the six-month period since September 30, 1998, the stock market has
experienced an astounding recovery. It has left behind the third-quarter
correction caused by Russia's default on its sovereign debt and the collapse
of several hedge funds, especially Long-Term Capital Management. The
cumulative gain for the S&P 500, the equity fund's basic benchmark, was
27.32%. We are pleased to report the Equity Portfolio did exceptionally well
in this initial period, since we began as its subadvisor, enjoying a gain of
36.23%.
The headline grabbing index returns were not representative of what was
actually happening in most stocks. The gains were highly concentrated in two
areas: the mega-large growth companies over $50 billion in market
capitalization and the Internet stocks. More representative indices, such as
the equal-weighted S&P 500, reflected increases of 18.5%. The small company
indices, such as the Russell 2000 (starts with the 1000th largest company),
had an increase of only 10%.
There was also a wide divergence between returns from companies classified
as growth companies as compared to those classified as value companies. The
Russell 1000 growth index, dominated by the largest companies, increased
34.8%, while the Russell 1000 value index increased 18.3%.
Atlanta Capital's philosophy in managing the Equity Portfolio is to only
invest in high-quality companies with favorable growth characteristics. We
have been unwilling, however, to pay the very high valuations accorded to
many of the mega-large growth companies, which were the leaders during the
period. Thus, we were very pleased to have outperformed both the growth
indices and other growth mutual funds through our stock selection.
What about emerging market and Y2K problems?
Today, the worldwide financial markets are much less concerned about two
potential problems which were making headlines last summer: the emerging
markets collapse and the Y2K problem.
The collapse of Russia's currency and subsequent default sent shock waves
through the financial markets last summer. Fear arose that the turmoil would
spread to Latin America and cause a worldwide recession. In fact, what
happened was a bottoming out and beginning of recovery in Asian economies
and relative stability in Latin America. The Brazilian devaluation was
contained to that country as a result of quick action from world financial
organizations and subsequent domestic economic reform. We believe Asia and
most of Latin America will experience good growth in 1999. Brazil still has
significant problems but has taken a number of steps to resolve them
long-term.
Russia's outlook is not good, significantly caused by the lack of a legal
system to protect the rights of private property and the presence of
widespread corruption. However, Russia's impact on the world is not material
in an economic context. The emerging markets stock prices rose during the
first quarter of 1999, signaling better economic times ahead.
The second concern raised last summer was the Y2K problem. Correcting this
problem has certainly caused some disruption to normal demand patterns,
especially in the boost to computer sales as replacements were accelerated.
Software sales slowed as the investment technology personnel in companies
planned, corrected, and tested their computers and production machines for
the changeover to the year 2000. So far, the reports are very encouraging.
The stock markets, telephone systems, electric utility, airline, and airport
systems have passed the tests almost flawlessly. We expect a few
inconveniences, but anticipate that most of the problems will be corrected
within a few days. This fear is creating some opportunities in the markets
as some good companies, which sell or implement software, have been beaten
down over fears of Y2K failure and legal liability. We are beginning to
accumulate a position in some of these companies.
What is your market outlook for the coming months?
Our general outlook for the equity market, as measured by the Dow or S&P
500, is cautious. Stocks are overvalued by all historical measures and wild
speculation in Internet stocks has now turned into a mania, similar to the
classical tulip bulb mania in the 1600's in Holland. This is a risky market.
At the same time, we continue to find many attractive companies to buy,
especially high-quality companies between $3 and $10 billion in market
capitalization. We expect that more difficult markets lie ahead, but we have
positioned the portfolio conservatively with good companies, with good
earnings outlooks, and at reasonable valuations.
April 28, 1999
Equity
Portfolio Statistics
March 31, 1999
Investment Performance
6 Months 12 Months
ended ended
3/31/99 3/31/99
Class A 36.23% 6.67%
Class B 35.32% 5.40%
Class C 35.45% 5.64%
S&P 500 Index
Mthly. Reinvested 27.32% 18.49%
Lipper Growth
Funds Average 28.23% 13.56%
Ten Largest Stock Holdings
% of Net Assets
Sun Microsystems, Inc. 4.20%
Office Depot, Inc. 3.72%
Anadarko Pete Corp. 3.70%
Cisco Systems, Inc. 3.69%
Lowes Co.'s, Inc. 3.39%
Dayton Hudson Corp. 3.17%
Pfizer, Inc. 3.11%
Schering Plough Corp. 3.10%
Mylan Labs, Inc. 3.08%
Gap, Inc. 3.02%
Total 34.18%
Investment performance does not reflect the deduction of any front-end or
deferred sales charge.
Source: Lipper Analytical Services, Inc.
New subadvisor assumed management of the Portfolio effective September 1998
Equity
Portfolio Statistics
March 31, 1999
Average Annual Total Returns
Class A Shares
as of 3/31/99
One year 1.60%
Five year 12.57%
Ten year 10.63%
Since inception 9.31%
(8/24/87)
Class B Shares
as of 3/31/99
One year 0.40%
Since inception 0.40%
(4/1/98)
Class C Shares
as of 3/31/99
One year 5.64%
Five year 12.33%
Since inception 10.93%
(3/1/94)
Performance Comparison
Comparison of change in value of $10,000
investment. (Source: Lipper Analytical Services, Inc.)
[LINE GRAPH HERE]
CSIF Equity Portfolio $27,511
S&P 500 Index Monthly Reinvested $56,725
Lipper Growth Funds Index $47,667
Total returns assume reinvestment of dividends and reflect the deduction of
the Fund's maximum front-end or deferred sales charge. No sales charge has
been applied to the index used for comparison. Past performance is no
guarantee of future results. The value of an investment in Class A shares is
plotted in the line graph. The value of an investment in another class of
shares would be different.
Equity
Portfolio Statistics
March 31, 1999
Asset Allocation
Stocks 96%
Bonds 1%
Cash & Cash Equivalents 3%
100%
Top Five Economic Sectors
% of Equity Holdings
Technology 19.50%
Health Care 18.74%
Raw Materials 12.70%
Business Equip. & Services 11.34%
Financial Services 11.30%
Equity
Portfolio
Statistics
March 31, 1999
Portfolio Characteristics
CSIF S&P
Equity 500
Portfolio Index
Number of Stocks 48 500
Median Market
Capitalization ($bil) 13.34 64.74
(by portfolio weight)
Price/Earnings
Ratio 38.09 31.12
Earnings Per Share
Growth 16.55% 17.66%
Yield 0.73% 1.26%
(return on capital investment)
Volatility Measures
CSIF S&P
Equity 500
Portfolio Index
Beta1 1.09 1.00
R-Squared2 0.90 1.00
1 Measure of volatility compared to the S&P 500 Stock Index (S&P 500) beta
of 1. The higher the beta, the higher the risk and potential reward.
2 Measure of correlation between the fund's returns and the overall market's
(S&P 500) returns. An R-Squared of 0 would mean no correlation, an R-Squared
of 1 would mean total correlation.
Source: Vestek
<PAGE>
[photo of Ted Gekas]
Ted Gekas of State Street Global Advisors
What were the key factors in the Fund's performance over the last six months?
Large cap stocks continued their domination of small cap stocks as the
Russell 1000 outpaced the Russell 2000 by 8.8% for the first quarter. The
Russell 1000 benefited from the continued run-up in blue-chips. The
technology sector of the Russell 1000 was up 7.6%, much of it driven by
names like America Online, Microsoft and Cisco Systems. This was the fifth
consecutive quarter in which growth stocks outperformed value. The more
momentum-oriented growth sectors like technology led the advance (up 7.6%),
while traditional defensive growth sectors such as health care (up 2.6%) and
consumer staples (down -10.1%) lagged.
What is your outlook for the equity market?
Current consensus US GDP forecasts for 1999 are generally in the 2.75%
range, up approximately 0.5% from the start of the year. Accordingly, we
raised our return expectations for large and small cap US stocks to 9% from
6% for large-cap stocks.
Regardless of how you look at it, large cap stocks are not cheap.
Price-to-earnings multiples and market sentiment readings are at or near
all-time highs. The breadth of the U.S. market continues to be very narrow--
demand being highest for communications and technology large cap growth
companies. Money flow from mutual funds and foreign investors is waning;
investors may be drawing a line at how much they are willing to pay for
projected returns. That being said, adjustments from current market
valuations will be contained by strong economic fundamentals. We look for
volatile forces to be worked out in the first half of the year, which should
allow for stronger second half returns.
April 28, 1999
Managed Index
Portfolio Statistics
March 31, 1999
Investment Performance
6 Months 12 Months
ended ended
3/31/99 3/31/99
Class A 24.53% N/A
Class B 23.66% N/A
Class C 23.59% N/A
Class I 24.65% N/A
Russell 1000
Index 26.90% N/A
Lipper Growth
Funds Average 28.23% N/A
Investment performance does not reflect the deduction of any front-end or
deferred sales charge.
Source: Lipper Analytical Services, Inc.
Average Annual Total Returns
Class A Shares
as of 3/31/99
Since inception 7.06%
(4/15/98)
Class B Shares
as of 3/31/99
Since inception 6.13%
(4/15/98)
Class C Shares
as of 3/31/99
Since inception 14.08%
(6/1/98)
Class I Shares
as of 3/31/99
Since inception 12.51%
(4/15/98)
Total returns assume reinvestment of dividends and reflect the deduction of
the Fund's maximum front-end or deferred sales charges.
Ten Largest Stock Holdings
% of Net Assets
Intel Corp. 3.18%
Johnson & Johnson 3.12%
Microsoft Corp. 3.09%
Merck & Co., Inc. 2.97%
Bellsouth Corp. 2.85%
Ameritech Corp. 2.65%
Amgen, Inc. 2.30%
American Int'l Group, Inc. 2.28%
Chase Manhattan Corp., Inc. 2.22%
Lucent Technologies, Inc. 2.03%
Total 26.69%
Asset Allocation
Stocks 100%
Cash & Cash Equivalents --
Total 100%
Top Five Economic Sectors
% of Equity Holdings
Financial Services 22.24%
Technology 19.33%
Health Care 14.88%
Utilities 13.10%
Consumer Non-durables 6.99%
Managed Index
Portfolio Statistics
March 31, 1999
Portfolio Characteristics
CSIF Russell
Managed Index 1000
Portfolio Index
Number of Stocks 148 952
Median Market
Capitalization ($bil) 37.97 57.64
(by portfolio weight)
Price/Earnings
Ratio 26.83 30.02
Earnings Per Share
Growth 19.04% 17.40%
Yield 1.44% 1.29%
(return on capital investment)
Volatility Measures
CSIF Russell
Managed Index 1000
Portfolio Index
Beta1 0.98 1.00
R-Squared2 0.98 1.01
1 Measure of volatility compared to the S&P 500 Stock Index (S&P 500) beta
of 1. The higher the beta, the higher the risk and potential reward.
2 Measure of correlation between the fund's returns and the overall market's
(S&P 500) returns. An R-Squared of 0 would mean no correlation, an R-Squared
of 1 would mean total correlation.
Source: Vestek
<PAGE>
MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 1999
U.S. GOVERNMENT AGENCY PRINCIPAL
OBLIGATIONS - 6.2% AMOUNT VALUE
Federal Home Loan Bank, 4.79%, 2/4/00 $6,000,000 $5,987,605
Federal National Mortgage Assn., 5.79%,
10/12/99 6,000,000 6,027,975
Total U.S. Government Agency Obligations
(Cost $12,015,580) 12,015,580
DEPOSITORY RECEIPTS FOR U.S. GOVERNMENT
GUARANTEED LOANS - 7.0%
Colson Services Corporation Loan Sets:*
7.737%, 9/9/06 183,587 184,709
7.094, 4/26/09 262,342 263,489
8.594%, 1/17/10 76,034 78,458
7.344%, 7/26/10 384,113 385,430
7.25%, 1/22/11 771,939 780,141
7.50%, 3/23/12 666,828 677,664
7.375%, 5/29/12 1,710,517 1,733,156
7.25%, 8/10/12 6,691,340 6,766,617
7.25%, 9/2/12 2,769,042 2,800,194
Total Depository Receipts for U.S. Government
Guaranteed Loans (Cost $13,669,858) 13,669,858
VARIABLE RATE LOANS GUARANTEED BY
AGENCIES OF THE U.S. GOVERNMENT - 1.2%
Loan pools:
6.25%, 3/1/07 849,945 846,758
7.00%, 12/8/15 1,537,313 1,543,462
Total Variable Rate Loans Guaranteed by Agencies of the
U.S. Government (Cost $2,390,220) 2,390,220
CERTIFICATES OF DEPOSIT - 2.2%
Bank of Cherokee County, 4.85%, 4/22/99 (^)100,000 100,000
Broadway Federal Savings & Loan, 5.20%,
8/20/99 (^) 100,000 100,000
Community Bank of the Bay, 4.45%, 10/7/99 (^) 100,000 100,000
Community Capital Bank, 4.15%, 1/20/00 (^)100,000 100,000
Elk Horn Bank & Trust, 5.34%, 12/18/99 (^) 100,000 100,000
Family Savings Bank, 5.40%, 8/20/99 (^) 100,000 100,000
First Community Bank, 5.40%, 4/22/99 (^) 100,000 100,000
Founders National Bank, 5.00%, 8/30/99 (^) 100,000 100,000
Royal Bank of Canada, 5.12%, 3/22/00 3,000,000 2,999,158
Seaway National Bank Chicago, IL, 4.40%,
1/27/00 (^) 100,000 100,000
Self Help Credit Union, 5.45%, 7/16/99 (^) 100,000 100,000
Shore Bank & Trust, 4.50%, 12/18/99 (^) 100,000 100,000
South Shore Bk of Chicago, 4.50%, 10/30/99 (^) 100,000 100,000
Total Certificates of Deposit (Cost $4,199,158) 4,199,158
<PAGE>
PRINCIPAL
COMMERCIAL PAPER - 10.2% AMOUNT VALUE
Duke University, 4.85%, 5/5/99 $2,000,000 $1,990,839
Duke University, 4.82%, 6/30/99 6,000,000 5,927,700
Island Finance Puerto Rico, 4.90%, 4/16/99 1,500,000 1,496,938
Northwestern University, 4.84, 4/27/99 4,000,000 3,986,018
Northwestern University, 4.84, 5/11/99 1,389,000 1,381,530
Receivable Capital Corporation, 4.86, 4/7/99 5,000,000
4,995,948
Total Commercial Paper (Cost $19,778,973) 19,778,973
CORPORATE TAXABLE NOTES - 2.6%
Norwest Bank Medium Term Notes, 6.05%,
11/19/99 5,000,000 5,032,076
Total Corporate Taxable Notes (Cost $5,032,076) 5,032,076
TAXABLE VARIABLE RATE DEMAND NOTES - 48.5%
ABAG Financing Authority for Nonprofit Corporations CA
Certificates of Participation VRDN, 5.00%, 10/1/27,
LOC: Banque National de Paris 3,468,000 3,468,000
Alabama St. Industrial Development Authority
VRDN, 5.05%, 12/1/19, LOC:
Nationsbank 5,540,000 5,540,000
Alabama St. Industrial Development Authority
VRDN, 4.98%, 5/1/10, LOC: Regions Bank115,000 115,000
Aspen Institute Inc. VRDN, 5.10%, 12/1/04,
LOC: First National Bank of Maryland 510,000 510,000
Barton Healthcare LLC VRDN, 4.95%, 2/15/25,
LOC: American National Bank & Trust 5,000,000 5,000,000
Berks County PA Industrial Development Authority Revenue
VRDN, 5.05%, 6/1/15, LOC: Corestates 2,135,000 2,135,000
Betters Group LP VRDN, 5.05%, 2/1/12, LOC:
Century National Bank & Trust,
Confirming LOC: Mellon Bk 2,090,000 2,090,000
California Statewide Community Development Revenue
VRDN, 5.45%, 7/1/27, LOC: Sanwa Bank 65,000 65,000
Chicago IL General Obligations VRDN, 4.986%, 1/1/19,
BPA: LaSalle Bank, INSUR: FGIC 5,000,000 5,000,000
Colorado Health Facilities Authority VRDN, 4.85, 11/1/26,
LOC: Kredietbank 5,000,000 5,000,000
Colorado Health Facilities Authority VRDN, 5.15, 2/1/25,
LOC: Kredietbank 2,945,000 2,945,000
Episcopal Health Services, Inc. VRDN, 5.05%, 3/1/28,
LOC: Banque Paribas 4,500,000 4,500,000
Gardena Certificates of Participation VRDN, 7.18%, 7/1/25,
LOC: Sumitomo Trust & Banking,
Confirming LOC: Dai-Ichi Kangyo Bank8,160,000 8,160,000
Health Midwest Ventures Group, 4.95%, 8/1/19,
LOC: Bank of America-IL 8,100,000 8,100,000
IPC Industries, Inc. VRDN, 5.05%, 10/1/11,
LOC: National Bank of Canada 3,750,000 3,750,000
La Mirada CA Industrial Development Authority
VRDN, 4.95%, 12/1/26, LOC: First
National Bank of Chicago 3,000,000 3,000,000
Memphis Center Finance Corp. Multi-family Housing
Revenue VRDN, 5.39%, 11/1/23, LOC:
National Bank of Commerce TN 225,000 225,000
Montgomery County KY Industrial Building Revenue
VRDN, 5.05%, 8/1/06, LOC: Fleet Bank1,826,000 1,826,000
<PAGE>
TAXABLE VARIABLE RATE PRINCIPAL
DEMAND NOTES (Cont'd) AMOUNT VALUE
Nevada Housing Division Cheyenne MFH VRDN, 4.94%, 4/1/31,
LOC: East-West Bank, Confirming
LOC: FHLB $1,920,000 $1,920,000
Nevada Housing Division Hilltop MFH VRDN, 4.94%, 4/1/31,
LOC: East-West Bank, Confirming
LOC: FHLB 570,000 570,000
Nevada Housing Division Stewart MFH VRDN, 4.93%, 4/1/31,
LOC: East-West Bank, Confirming
LOC: FHLB 585,000 585,000
New Hampshire State Business Financial Authority Revenue
VRDN, 5.15%, 6/1/28, LOC: Fleet Bank2,000,000 2,000,000
Pleasant Hill CA Redevelopment Agency VRDN, 5.55%, 8/1/26,
LOC: Heller Financial, Confirming
LOC: Commerze Bank, AG 50,000 50,000
San Jose Financing Authority Revenue VRDN, 4.95%,
12/1/25, BPA: Bank of Nova Scotia,
INSUR: AMBAC 6,450,000 6,450,000
Sault Sainte Marie Tribe Building Authority Revenue
VRDN, 5.55%, 6/1/03, LOC: First
America Bank of Michigan 4,770,000 4,770,000
South Central Communications Corp., 5.10%, 6/1/13,
LOC: Citizens National Bank of Evansville,
Confirming LOC: Suntrust Bank 4,000,000 4,000,000
St. Josephs County Multi-family Housing VRDN, Pin Oak
Apartments, 5.09%, 6/1/27, LOC:
Federal Home Loan Bank 695,000 695,000
St. Paul MN Port Authority Industrial Revenue
VRDN, 5.40%, 6/1/11, LOC:
US Bank N.A. 775,000 775,000
Texas St., Texas Veterans Land, 4.965%,
12/1/27, TOA: Citibank 8,115,000 8,115,000
W.L. Petrey Wholesaling, Inc. VRDN, 5.05%, 3/1/08,
LOC: Southtrust Bank of Alabama 2,470,000 2,470,000
Waukesha Health Systems Inc. VRDN, 5.00%, 8/15/26,
LOC: Bank of America 400,000 400,000
Total Taxable Variable Rate Demand
Notes (Cost $94,229,000) 94,229,000
REPURCHASE AGREEMENTS - 21.2%
Donaldson, Lufkin & Jenrette, 5.00%, dated 3/31/99,
due 4/1/99 (Collateral: $15,060,210
FHLMC, 5.375%, 3/1/01) 14,759,000 14,759,000
Donaldson, Lufkin & Jenrette, 5.00%, dated 3/31/99,
due 4/1/99 (Collateral: $20,111,224 FHLMC
4.750%, 12/14/01) 19,709,000 19,709,000
Donaldson, Lufkin & Jenrette, 5.00%, dated
3/31/99, due 4/1/99 (Collateral: $6,869,395
Refco Stripped Principal, 10/15/19) 6,732,000 6,732,000
Total Repurchase Agreements (Cost $41,200,000) 41,200,000
TOTAL INVESTMENTS (Cost $192,514,865) - 99.1%192,514,865
Other assets and liabilities, net - 0.9%
1,779,734
Net Assets - 100% $194,294,599
See notes to financial statements.
<PAGE>
BALANCED PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 1999
PRINCIPAL
CERTIFICATES OF DEPOSIT - 0.1% AMOUNT VALUE
Alternative Federal Credit Union, 4.00%,
11/30/99 (^) $50,000 $49,835
Blackfeet National Bank, 5.15%, 11/13/99 (^) 92,000 91,565
D. Edward Wells Federal Credit Union, 5.00%,
11/20/99 (^) 50,000 49,389
First American Credit Union, 5.75%, 12/23/99 (^) 92,000 91,560
Mission Area Federal Credit Union, 4.95%,
11/18/99 (^) 50,000 49,796
Northeast Community Federal Credit Union,
5.00%, 11/18/99 (^) 50,000 49,815
South Shore Bank of Chicago:
5.55%, 12/5/99 (^) 100,000 98,631
4.75%, 2/9/00 (^) 350,000 348,475
Total Certificates of Deposit (Cost $834,000) 829,066
CONVERTIBLE DEBENTURE BONDS - 0.0%
WorldWater, Inc., 9.00%, 3/31/98 (*)(#)(b) 150,000 45,000
Total Convertible Debenture Bonds (Cost $150,000) 45,000
COMMUNITY LOAN NOTES - 0.6%
Accion International Corp., 4.00%, 1/13/00 250,000 239,535
Accion US Bridge Fund, 4.00%, 1/12/01 100,000 95,903
Boston Community Loan Fund, 4.50%, 1/12/01500,000 481,280
Coastal Enterprises, Inc., 4.00%, 7/15/01 200,000 196,714
Community Reinvestment Fund, 4.00%, 4/5/00100,000 94,705
Co-op Fund of New England, Inc., 4.00%,
1/13/00 105,000 100,605
Eastside Community Investment, 4.00%,
4/5/00 (b) 100,000 33,000
Ecumenical Development Corp., 5.00%,
12/31/01 100,000 96,609
Environmental Enterprises Assistance Fund,
4.50%, 6/28/99 125,000 123,376
First State Community Loan Fund,
4.00%, 1/13/02 25,000 23,976
Foundation for International Community Asst.,
3.50%, 4/30/01 50,000 49,732
Housing Assistance Council, 4.50%, 6/30/02 75,000 74,067
Institute for Community Development, 4.00%,
10/1/01 250,000 243,100
Institute for Community Economics, 4.00%,
1/13/00 150,000 143,721
Interfaith Housing Delaware, 4.50%, 12/31/99 49,888 39,910
Low Income Housing Fund, 4.00%, 9/30/04 500,000 486,200
Manna, Inc., 4.50%, 9/30/02 250,000 243,675
Michigan Housing Trust, 4.50%, 6/28/99 100,000 98,701
Micro Industry Credit Rural Corp., 4.50%,
1/13/01 100,000 96,256
Minnesota Non Profit Assistance Fund, 4.00%,
4/7/00 200,000 189,354
National Fed of Community Development Credit Union,
4.00%, 4/7/01 400,000 379,156
New Hampshire Community Loan Fund, 4.00%,
7/15/01 400,000 394,592
Nonprofit Facilities Fund, 4.50%, 6/30/99 100,000 98,674
North Country Co-op Development Fund,
4.50%, 1/12/01 100,000 96,256
Northeast South Dakota Energy Conservation Corp.,
4.50%, 1/13/03 25,000 24,064
Opportunity International, 3.50%, 9/30/99 100,000 97,009
Saint Ambrose Housing Center, 4.50%, 3/31/00 25,000 23,808
Vermont Community Loan Fund, 4.50%, 4/30/01200,000 199,082
<PAGE>
PRINCIPAL
COMMUNITY LOAN NOTES (Cont'd) AMOUNT VALUE
Washington Area Community Investment
Fund, 4.50%, 12/31/01 $317,000 $305,132
Western Massachusetts Enterprise Fund,
4.50%, 9/30/03 50,000 48,735
Women's Self-Employment Loan Fund,
4.50%, 3/30/00 50,000 47,623
Total Community Loan Notes (*)(Cost $5,095,888) 4,864,550
CORPORATE BONDS - 30.5%
Abbey National PLC, 8.20%, 10/15/04 3,000,000 3,265,830
Advanta Corp., 7.05%, 7/30/99 3,000,000 2,967,150
AGL Capital Trust, 8.17%, 6/1/37 4,000,000 3,841,760
All Media Solutions, 9.00%, 7/31/99 (*)(#)(b) 50,000 33,000
Atlantic Mutual Insurance Co., 8.15%, 2/15/28 8,500,000 7,322,070
BNP US Funding LLC, 7.738%, 12/31/49 4,000,000 3,888,760
Bank United Corp., 8.00%, 3/15/09 2,000,000 1,975,660
BellSouth Telecommunications,
6.00%, 6/15/02 8,015,000 8,085,532
Community Reinvestment Fund, 6.35%, 6/1/1581,681 77,007
Computer Associates International, Inc.:
6.25%, 4/15/03 5,600,000 5,511,296
6.375%, 4/15/05 2,000,000 1,948,080
Conseco Financing Trust III, 8.796%, 4/1/27 6,750,000 6,123,465
Conseco Medium Term Notes, 6.40%, 6/15/115,800,000 5,698,732
Conseco, Inc., 6.80%, 6/15/05 3,000,000 2,872,740
Credit Suisse First Boston, 7.90%, 4/29/49 4,000,000 4,061,000
Crescent Real Estate Equities, 7.00%, 9/15/02 5,000,000 4,608,700
Dayton Hudson Corp., 5.95%, 6/15/00 2,000,000 2,008,080
Dime Bancorp, Inc., 6.375%, 1/30/01 5,000,000 4,963,900
Discover Card Medium Term Notes,
5.90%, 10/15/04 1,000,000 1,007,120
Dresdner Bank, 6.625%, 9/15/05 3,000,000 3,014,400
Federated Department Stores,
Inc., 6.30%, 9/1/28 2,000,000 1,973,140
First Interstate Bancorp, 9.90%, 11/15/01 1,000,000 1,101,640
Florida Windstorm Underwriting,
7.125%, 2/25/19 8,500,000 8,523,035
Fuji Bank, Ltd., 9.87%, 12/31/49 6,500,000 5,817,500
Goldman Sachs Group LP:
6.60%, 7/15/02 3,500,000 3,515,120
7.875%, 1/15/03 6,000,000 6,301,560
6.625%, 12/1/04 1,000,000 996,650
6.34%, 3/01/06 1,250,000 1,231,663
International Business Machines Corp.,
5.25%, 12/1/03 2,000,000 1,958,180
Interpool, Inc.:
6.625%, 3/1/03 7,000,000 6,207,390
7.20%, 8/1/07 1,500,000 1,266,465
Key Bank Medium Term Notes,
5.80%, 4/1/04 2,000,000 1,968,408
LG & G Capital Corp., 5.75%, 11/1/01 1,500,000 1,484,130
Long Island Savings Bank, 7.00%, 6/13/02 2,500,000 2,552,025
Mark IV Industries, Inc., 7.50%, 9/1/07 6,000,000 5,673,900
Mckesson Corp., 6.30%, 3/1/05 900,000 888,426
Merita Bank, Ltd., 7.15%, 12/29/49 7,125,000 7,083,888
National Association of People with AIDS,
10.00%, 1/31/98 (*)(#)(b) 250,000 25,000
National Rural Utilities:
5.38%, 12/15/03 1,000,000 986,260
5.50%, 1/15/05 8,000,000 7,827,360
NCB Affordable Housing / Market Rate Cooperative First
Mortgage Certificates Series 1993-3 B,
7.70%, 7/1/12 (*) 2,592,436 2,615,508
Nordstrom, Inc., 5.625%, 1/15/09 2,000,000 1,915,540
<PAGE>
PRINCIPAL
CORPORATE BONDS (Cont'd) AMOUNT VALUE
Onbank Capital Trust I, 9.25%, 2/2/27 $11,600,000 $12,759,768
Orion Capital Trust II, 7.70%, 4/15/28 2,000,000 1,694,480
Pacific Bell, 6.25%, 3/1/05 1,500,000 1,524,525
Penny (J.C.), Inc., 7.25%, 4/1/02 (*) 4,250,000 4,370,700
Pioneer Human Services, 8.75%, 5/27/01 (*) 500,000 504,868
Poland Partners, 5.875%, 4/13/04 (*) 630,527 470,234
Prime Property Funding II, 6.80%, 8/15/02 4,000,000 3,930,880
Providian Capital I, 9.525%, 2/1/27 2,500,000 2,441,050
Puget Sound Energy, 6.23%, 7/11/02 3,248,727 3,289,433
Sage Bruno, 6.00%, 12/31/99 (*) 125,000 100,000
Seventh Generation, 10.85%, 6/30/02 (*) 100,000 100,000
Skandinaviska Enskilda Banken, 6.50%,
12/29/49 5,300,000 5,136,627
Socgen Real Estate Co. LLC, 7.64%, 12/29/498,150,000 7,589,280
Sovereign Bancorp, Inc., 6.75%, 9/1/00 1,500,000 1,498,905
Stanley Works, 5.75%, 3/1/04 2,000,000 1,980,800
Sun Life Canada Capital Trust I,
8.526%, 5/29/49 3,000,000 3,116,550
Sunamerica, Inc., 6.75%, 10/1/07 4,000,000 4,184,600
Swedbank Sparbank Svenge AB,
7.50%, 9/27/49 1,000,000 971,906
Telecom Corp of New Zealand,
6.50%, 2/10/08 2,500,000 2,551,575
Tokai Funding Capital Co. LLC,
9.98%, 12/29/49 2,500,000 2,225,000
Transamerica Financial Corp., 5.93%, 3/25/02 3,000,000 2,987,100
Tyco International Group, 6.125%, 6/15/01 4,000,000 4,026,040
12th Street Historic Rehabilitation Associates Mortgage,
10.75%, 4/15/99 (#)(b)(*) 355,099 71,019
Umbono Investment, 10.00%, 1/16/02 (*) 898,209 751,316
Union Bank Norway, 7.35%, 12/31/49 4,000,000 4,041,400
US West Capital Funding, Inc.:
6.125%, 7/15/02 500,000 504,185
6.25%, 7/15/05 500,000 503,795
Westdeutsche Landesbank, 6.05%, 1/15/09 4,000,000 3,898,688
WFS Financial Owner Trust, 6.25%, 3/20/03 4,565,000 4,621,742
Xerox Capital Trust I, 8.00%, 2/1/27 3,450,000 3,519,379
Zurich Capital Trust, 8.376%, 6/1/37 5,850,000 6,205,435
Total Corporate Bonds (Cost $241,698,384) 236,758,350
MUNICIPAL OBLIGATIONS - 3.5%
Chickasaw Nation Certificates of Participation,
10.00%, 8/1/03 3,804,721 3,424,249
Maryland State Economic Development Corp. Revenue Bonds,
8.00%, 10/1/05 3,625,000 3,726,282
Maryland State Economic Development Corp. Revenue Bonds,
8.625%, 10/1/19 3,750,000 4,369,987
Philadelphia Authority for Industrial Development Pension
Funding Revenue Bonds:
5.69%, 4/15/07 5,000,000 4,902,150
6.35%, 4/15/28 6,000,000 5,703,240
San Mateo Redevelopment Agency Tax Allocation Refunding Bonds,
7.125%, 8/1/08 1,415,000 1,453,771
Virginia Development Authority Revenue Bonds,
7.40%, 7/1/06 1,000,000 1,037,800
Virginia Development Authority Revenue Bonds,
7.45%, 7/1/07 2,000,000 2,083,400
Total Municipal Obligations (Cost $26,336,911) 26,700,879
<PAGE>
U.S. GOVERNMENT AGENCIES PRINCIPAL
AND INSTRUMENTALITIES - 0.6% AMOUNT VALUE
Federal National Mortgage Assn.,
6.09%, 9/27/27 $3,250,000 $3,158,220
Federal National Mortgage Assn.,
6.08%, 9/01/28 1,700,000 1,649,085
Total U.S. Government Agencies and Instrumentalities
(Cost $5,147,709) 4,807,305
REPURCHASE AGREEMENTS - 3.5%
Donaldson, Lufkin & Jenrette, 5.00%, dated 3/31/99, due 4/1/99
(Collateral: $13,556,120 FNMA,
4.750%, 12/14/01) 13,285,000 13,285,000
Donaldson, Lufkin & Jenrette, 5.00%, dated 3/31/99, due 4/1/99
(Collateral: $14,096,950 Refco
Stripped Prinicpal, 10/15/19) 13,815,000 13,815,000
Total Repurchase Agreements
(Cost $27,100,000) 27,100,000
LIMITED PARTNERSHIP INTEREST - 0.3%
Environmental Allies Investment Trust 50,000 12,325
Environmental Private Equity Fund II 200,000 156,121
Global Environment Emerging Markets Fund 2 0
GEEMF Partners 255,500 138,129
Hambrecht & Quist Environmental
Technology Fund 500,000 223,610
HFG Expansion Fund I 125,000 0
IEPF Equity Fund III (#) 500,000 563,432
Labrador Ventures III (#) 200,000 195,268
Liberty Environmental Partners 350,000 277,939
Poland Partners 350,000 341,895
Ukraine Fund 70,000 54,810
Utah Ventures (#) 175,000 142,667
Venture Strategy Partners 66,599 62,836
Viridian Capital (#) 235,125 203,865
Total Limited Partnership Interest
(*)(Cost $3,623,160) 2,372,897
EQUITY SECURITIES - 61.4% SHARES
Capital Goods - 2.1%
Illinois Tool Works, Inc. 74,300 4,597,312
Solectron Corp. (#) 130,800 6,351,975
Tyco International, Ltd. 77,900 5,589,325
16,538,612
Communication Services - 3.7%
Alltel Corp. 51,100 3,187,362
Ameritech Corp. 30 1,736
Bellsouth Corp. 88,500 3,545,531
Century Telephone Enterprises 49,362 3,467,680
MCI Worldcom, Inc. (#) 120,485 10,670,452
SBC Communications, Inc. 167,440 7,890,610
28,763,371
Consumer Cyclicals - 7.1%
Acxiom Corp. (#) 155,500 4,120,750
Autozone, Inc. (#) 53,100 1,612,912
Costco Companies, Inc. (#) 84,000 7,691,250
Dayton Hudson Corp. 77,900 5,190,087
Dollar General Corp. 238,790 8,118,860
Fastenal Co. 111,200 3,898,950
Harley Davidson, Inc. 64,700 3,720,250
<PAGE>
EQUITY SECURITIES (Cont'd) SHARES VALUE
Consumer Cyclicals (Cont'd)
Home Depot, Inc. 151,140 $9,408,465
IMS Health, Inc. 87,800 2,908,375
Lowes Companies, Inc. 48,000 2,904,000
New York Times Co. 60 1,710
Real Goods Trading Corp. (#) 125,000 488,281
Staples, Inc. (#) 91,050 2,993,269
Sylvan Learning Systems, Inc. (#) 60,000 1,642,500
54,699,659
Consumer Staples - 7.9%
Cardinal Health, Inc. 188,175 12,419,550
Clear Channel Communications (#) 45,100 3,024,518
CVS Corp. 106,200 5,044,500
Dial Corp. 128,500 4,417,187
Fort James Corp. 70 2,218
Gillette Co. 169,300 10,062,768
Heinz (H. J.) Co. 20 947
Kroger Co. (#) 71,500 4,281,063
Newell Rubbermaid, Inc. 119,000 5,652,500
Robert Half International, Inc. (#) 85,600 2,808,750
Safeway, Inc. (#) 82,600 4,238,412
Time Warner, Inc. 127,200 9,039,150
60,991,563
Financial Services - 12.6%
Aflac, Inc. 94,400 5,138,900
American International Group, Inc. 83,927 10,123,694
BankAmerica Corp. 124,400 8,785,750
Chase Manhattan Corp. 46,800 3,805,425
Conseco, Inc. 62,500 1,929,687
Equitable Companies, Inc. 61,900 4,333,000
Federal National Mortgage Assn. 108,720 7,528,860
Fifth Third Bancorp. 60,100 3,962,843
Firstar Corp. 63,200 5,656,400
Franklin Resources, Inc. 105,000 2,953,125
Highwood Properties, Inc. 6,900 5,972,502
Marsh & Mclennan Companies 71,600 5,311,825
Mellon Bank Corp. 68,300 4,806,612
Price (T. Rowe) Associates, Inc. 163,800 5,630,625
SLM Holding Corp. 140,400 5,861,700
State Street Boston Corp. 94,300 7,750,281
Umbono Investments (#)(a) 22,670,603 4,047,172
Washington Mutual, Inc. 101,500 4,148,812
97,747,213
Pharmaceutical & Health Care - 8.6%
Amgen, Inc. (#) 76,000 5,690,500
Aviron (#) 37,074 750,748
Boston Scientific Corp. (#) 144,800 5,873,450
Guidant Corp. 55,100 3,333,550
Hayes Medical Services (#)(*) 303,030 400,000
Health Management Association (#) 274,025 3,339,679
Johnson & Johnson 107,300 10,052,668
<PAGE>
EQUITY SECURITIES (Cont'd) SHARES VALUE
Pharmaceutical & Health Care (Cont'd)
Medtronic, Inc. 87,000 $6,242,250
Merck & Co., Inc. 181,724 14,571,993
Pfizer, Inc. 58,700 8,144,625
Quadrant Healthcare Plc. (#) 305,263 374,564
Schering Plough Corp. 146,800 8,119,875
66,893,902
Publishing - 0.0%
UOL Publishing (#) 25,080 100,320
Technology - 18.7%
America Online, Inc. (#) 56,000 8,176,000
BMC Software, Inc.(#) 109,200 4,047,225
Cisco Systems, Inc. (#) 66,700 7,307,818
Compaq Computer Corp. 238,300 7,551,131
Compuware Corp. (#) 120,400 2,874,550
EMC Corp.(#) 105,870 13,524,893
Fiserv, Inc. (#) 40,800 2,187,900
Hewlett Packard Co. 20 1,356
Intel Corp. 78,800 9,367,350
International Business Machines Corp. 77,700 13,772,325
Lucent Technologies, Inc. 92,600 9,977,650
Microsoft Corp.(#) 224,480 20,119,020
Network Associates, Inc. (#) 104,050 3,193,034
Oracle Systems Corp.(#) 219,469 5,788,494
Parametric Technology (#) 237,700 4,694,575
Paychex, Inc. 123,900 5,877,506
Sterling Commerce, Inc. (#) 155,900 4,793,925
Sterling Software, Inc. (#) 180,400 4,284,500
Sun Microsystems, Inc. (#) 56,900 7,108,943
Tellabs, Inc. (#) 111,300 10,879,601
145,527,796
Venture Capital - 0.7%
Agraquest, Inc., Series B Preferred (#)(*) 190,477 323,811
Agraquest, Inc., Series C Convertible
Preferred (#)(*) 117,647 200,000
All Media Solutions, Inc.(#)(*) 389,692 167,178
Calypte Biomed (#)(*) 100,000 275,000
Coastal Venture Partners (*) 80,000 76,801
Community Bank of the Bay (#)(*) 4,000 100,000
Community Growth Fund (*) 1,315,609 450,269
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, Series B (#)(*) 100,000 200,000
Evergreen Solar, Series C (#)(*) 76,972 153,944
Evergreen Solar (warrants)(#)(*) 30,789 300
Fountainhead Technologies, Inc.,
Preferred (#)(*) 3,295 25,000
Knowaste LLC (#)(*) 814 81,400
Living Technologies, Inc. (#)(*) 25,000 100,000
Neighborhood Bancorp (#)(*) 10,000 100,000
Paradigm Biosciences (#)(*) 125,000 275,000
<PAGE>
EQUITY SECURITIES (Cont'd) SHARES VALUE
Venture Capital (Cont'd)
Paradigm, Inc. (#)(*) 121,591 $250,000
Picturetalk (warrants) (#)(*) 22,222 0
Pro Fund International (#)(*) 5,729 5,729
Pro Fund International, Preferred (#)(*) 567,119
567,119
Take the Lead (#)(*) 23,630 50,945
Ultrafem, Inc. (#)(*) 25,000 0
Ultrafem, Inc. (warrants)(#)(*) 175,000 0
Wild Planet Toys, Inc., Series B,
Preferred (#)(*) 476,190 666,666
Wild Planet Toys, Inc.,
Series E, Preferred (#)(*) 129,089 180,724
Wind Harvest Co., Inc., Series A,
Preferred (#)(*) 8,696 50,000
5,186,964
Total Equity Securities (Cost $356,786,208) 476,449,400
TOTAL INVESTMENTS
(Cost $666,772,260) - 100.5% 779,927,447
Other assets and liabilities, net - (0.5%)
(3,527,267)
Net Assets - 100% $776,400,180
See notes to financial statements.
<PAGE>
BOND PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 1999
PRINCIPAL
CORPORATE BONDS - 84.7% AMOUNT VALUE
AGL Capital Trust, 8.17%, 6/1/37 $1,000,000 $960,440
Advanta Corp., 7.05%, 7/30/99 2,000,000 1,978,100
ARG Funding Corp., 6.02%, 5/20/05 2,000,000 2,004,375
Atlantic Mutual Insurance Co.,
8.15%, 2/15/28 500,000 430,710
BNP US Funding LLC, 7.738%, 12/31/49 1,000,000 972,190
BellSouth Savings & Employee ESOP,
9.125%, 7/1/03 141,765 152,156
BellSouth Telecommunications, 6.00%,
6/15/02 2,000,000 2,017,600
Citizens Utilities Co., 8.45%, 9/1/01 1,000,000 1,054,910
Colonial Bank, 8.00%, 3/15/09 1,000,000 981,200
Computer Associates International Inc.:
6.25%, 4/15/03 1,000,000 1,377,824
6.375%, 4/15/05 2,000,000 1,948,080
Conseco Inc., 6.40%, 2/10/03 2,000,000 1,939,640
Dayton Hudson Corp., 5.95%, 6/15/00 2,000,000 2,008,080
Dime Bancorp Inc., 6.375%, 01/30/01 2,000,000 1,985,560
Discover Card Medium Term Notes, 5.90%,
10/15/04 2,000,000 2,014,240
Florida Widstrom Underwriting, 7.125%,
2/25/19 2,500,000 2,506,775
Fuji Bank, Ltd., 9.87%, 12/31/49 1,500,000 1,342,500
Goldman Sachs Group LP, 6.34%, 3/1/06 1,750,000 1,724,327
Interpool Capital Trust, 9.875%, 2/15/27 500,000 439,005
Interpool, Inc., 6.625%, 3/1/03 1,000,000 886,770
Key Bank Medium Term Notes, 5.80%,
4/1/04 1,000,000 984,204
LG & G Capital Corp., 5.75%, 11/1/01 1,500,000 1,484,130
Mark IV Industries, Inc., 7.50%, 9/1/07 500,000 472,825
Merita Bank, Ltd., 7.15%, 12/29/49 1,290,000 1,282,557
National Cooperative Bank, 6.06176%, 7/1/12777,731 787,530
National Rural Utilities Cooperative Financing,
5.50%, 1/15/05 1,000,000 978,420
Nordstrom Inc., 5.625%, 1/15/09 750,000 718,328
North American Mortgage Medium Term,
7.315%, 8/25/03 500,000 507,050
Onbank Capital Trust I, 9.25%, 2/1/27 2,000,000 2,199,960
Orion Capital Trust II, 7.70%, 4/15/28 500,000 423,620
Pacific Bell:
7.25%, 7/1/02 1,950,000 2,038,218
6.25%, 3/1/05 1,000,000 1,016,350
Prime Property Funding II, 6.80%, 8/15/02 2,000,000 1,965,440
Russell Frank Co., 5.625%, 1/15/09 500,000 482,785
Skandinaviska Enskilda Banken, 6.50%,
12/29/49 1,500,000 1,453,763
Socgen Real Estate Co. LLC, 7.64%, 12/29/49260,000 242,112
Sovereign Bancorp Inc., 6.75%, 9/1/00 1,500,000 1,498,905
Sunamerica Inc., 6.75%, 10/1/07 3,000,000 3,138,450
Tokai Preferred Capital LLC, 9.98%, 12/29/49 300,000 267,000
Tyco International Group, 6.125%, 6/15/01 1,000,000 1,006,510
Union Bank Norway, 7.35%, 12/31/49 1,000,000 1,010,350
Union Pacific Resources Group Inc.,
7.05%, 5/15/18 500,000 453,825
Westdeutsche Landesbank Giroze, 6.05%,
1/15/09 500,000 487,336
WFS Financial Owner Trust, 6.25%, 3/20/03 2,000,000 2,024,860
Xerox Capital Trust I, 8.00%, 2/01/27 1,000,000 1,020,110
Zurich Capital Trust, 8.376%, 6/1/37 2,500,000 2,651,825
Total Corporate Bonds (Cost $59,735,398) 59,320,945
<PAGE>
U.S. GOVERNMENT AGENCIES Principal
AND INSTRUMENTALITIES - 10.2% Amount Value
Federal Home Loan Mortgage Corp.,
7.12%, 6/25/28 $2,750,000 $2,824,745
Federal National Mortgage Assn.,
6.09%, 9/27/27 1,250,000 1,214,700
Federal National Mortgage Assn., 6.08%,
9/1/28 3,250,000 3,104,160
Total U.S. Government Agencies and Instrumentalities
(Cost $7,455,338) 7,143,605
MUNICIPAL OBLIGATIONS - 4.9%
Missouri Higher Education Student Loan Revenue Bonds,
6.80%, 2/15/01 1,000,000 1,018,830
Philadelphia PA Authority, 6.35%, 4/15/28 2,000,000 1,901,080
Somerville, Massachusetts, U.S. Government Guaranteed Notes,
7.12%, 8/1/01 475,000 490,547
Total Municipal Obligations (Cost $3,364,862) 3,410,457
CERTIFICATES OF DEPOSIT - 0.1%
South Shore Bank, 4.75%, 2/9/00 100,000 99,564
Total Certificates of Deposit (Cost $100,000) 99,564
COMMERCIAL LOAN NOTES - 0.6%
DC Habitat for Humanity, 4.50%, 2/17/01 150,000 143,898
Northeast Entrepreneur Fund, 4.50%, 6/30/03100,000 98,756
St. Vincent de Paul Society, 4.50%, 7/29/01 200,000 196,620
Total Commercial Loan Notes (*)(Cost $450,000) 439,274
EQUITY SECURITIES - 0.9% SHARES
Highwoods Properties Inc., Series A, Preferred 600 519,348
Northern Borders Partners, LP (*) 3,500 106,969
Total Equity Securities (Cost $695,819) 626,317
TOTAL INVESTMENTS (Cost $71,801,417) - 101.4%71,040,162
Other assets and liabilities, net - (1.4%)
(1,003,146)
Net Assets - 100% $70,037,016
See notes to financial statements.
<PAGE>
EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 1999
EQUITY SECURITIES - 95.8% SHARES VALUE
Basic Industries - 3.2%
Morton International, Inc. 81,000 $2,976,750
Nalco Chemical Co. 105,600 2,805,000
Smurfit Stone Container Corp. (#) 1,000 19,312
5,801,062
Capital Goods - 7.1%
Dover Corp. 96,000 3,156,000
Pitney Bowes, Inc. 40,000 2,550,000
Solectron Corp. (#) 70,000 3,399,375
Tyco International, Ltd. 50,000 3,587,500
12,692,875
Communication Services - 0.0%
Ameritech Corp. 500 28,937
Consumer Cyclicals - 23.9%
American Greetings Corp. 100 2,537
Autozone, Inc. (#) 150,000 4,556,250
Black & Decker Corp. 400 22,175
Block H & R, Inc. 100,000 4,737,500
Dayton Hudson Corp. 85,000 5,663,125
Family Dollar Stores, Inc. 200,000 4,600,000
Gap, Inc. 80,000 5,385,000
Harley Davidson, Inc. 85,000 4,887,500
Liz Claiborne, Inc. 500 16,312
Lowes Companies, Inc. 100,000 6,050,000
Masco Corp. 800 22,600
Office Depot, Inc. (#) 180,100 6,629,931
Office Max, Inc. (#) 100 862
Reebok International, Ltd. (#) 600 9,525
42,583,317
Consumer Staples - 5.1%
Albertsons, Inc. 100 5,431
Colgate Palmolive Co. 46,000 4,232,000
Newell Rubbermaid Inc. 100,788 4,787,444
9,024,875
Energy - 6.3%
Anadarko Petroleum Corp. 175,000 6,606,250
Enron Corp. 280,000 4,655,000
11,261,250
Financial Services - 10.8%
Aflac, Inc, 63,000 3,429,562
American International Group, Inc. 35,000 4,221,875
BankAmerica Corp. 50,343 3,555,474
Federal National Mortgage Assn. 50,000 3,462,500
<PAGE>
EQUITY SECURITIES (Cont'd) SHARES VALUE
Financial Services (Cont'd)
Frontier Insurance Group, Inc. 150,000 $1,781,250
Progressive Corp. 20,000 2,870,000
19,320,661
Pharmaceutical & Health Care - 18.0%
Biomet, Inc, 88,000 3,690,500
Dentsply International, Inc. 90,000 2,092,500
Merck & Co., Inc. 58,000 4,650,875
Mylan Labs, Inc. 200,000 5,487,500
Pfizer, Inc. 40,000 5,550,000
Schering Plough Corp. 100,000 5,531,250
Stryker Corp. 100,000 5,043,750
32,046,375
Technology - 21.4%
Adobe Systems, Inc. 85,000 4,823,750
Cisco Systems, Inc. (#) 60,000 6,573,750
Electronic Data Systems Corp. 110,000 5,355,625
Grainger (W.W.), Inc. 65,000 2,799,062
Hewlett Packard Co. 60,000 4,068,750
Intel Corp. 30,000 3,566,250
Scientific Atlanta, Inc. 125,000 3,406,250
Sun Microsystems, Inc. (#) 60,000 7,496,255
38,089,692
Total Equity Securities (Cost $129,835,419) 170,849,044
PRINCIPAL
Commercial Loan Notes - 0.8% AMOUNT
Chicago Community Loan Fund,
4.50%, 6/30/03 $150,000 148,134
Community Loan Fund of SW Pennsylvania,
4.50%, 4/15/01 100,000 95,246
Delaware Valley Reinvestment Fund,
4.50%, 7/15/03 250,000 245,950
Enterprise Corp. of Delta, 4.50%,
7/29/01 300,000 295,140
Midwest Minnesota CDC, 4.50%, 9/30/01 300,000 292,410
Primary Care Development Corp.,
4.50%, 2/17/01 200,000 191,090
South Shore Bank, 4.75%, 2/09/00 100,000 99,564
Total Commercial Loan Notes (*)(Cost $1,400,000) 1,367,534
Repurchase Agreements - 3.3%
State Street Bank, 4.89%, dated 3/31/99, due 4/1/99
(Collateral: $6,183,312 FHCMC,
5.125%, 10/15/08) 6,000,000 6,000,000
Total Repurchase Agreements (Cost $6,000,000) 6,000,000
TOTAL INVESTMENTS (Cost $137,235,419) - 99.9%178,216,578
Other assets and liabilities, net - 0.1% 153,647
Net Assets - 100% $178,370,225
See notes to financial statements.
<PAGE>
MANAGED INDEX PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 1999
EQUITY SECURITIES - 99.6% SHARES VALUE
Basic Industries - 0.0%
Level 3 Communications, Inc. (#) 100 $7,281
Capital Goods - 3.1%
National Service Industries, Inc. 3,100 105,594
Paccar, Inc. 3,100 127,681
Pitney Bowes, Inc. 700 44,625
Premark International, Inc. 12,400 408,425
Solectron Corp. (#) 2,600 126,262
York International Corp. 4,500 158,906
971,493
Communication Services - 10.7%
Air Touch Communications 2,600 251,225
Ameritech Corp. 14,600 844,975
Bellsouth Corp. 22,700 909,418
MCI Worldcom, Inc. (#) 3,700 327,681
SBC Communications, Inc. 9,400 442,975
US West, Inc. 11,400 627,712
3,403,986
Consumer Cyclicals - 8.8%
American Greetings Corp. 3,000 76,125
Best Buy, Inc. (#) 4,300 223,600
Central Newspapers, Inc. 8,800 273,900
Costco Companies, Inc. (#) 2,100 192,281
Dayton Hudson Corp. 2,200 146,575
Dun & Bradstreet Corp. 4,400 156,750
Federal Mogul Corp. 700 30,100
Federated Department Stores, Inc.(#) 2,400 96,300
Gap, Inc. 1,650 111,066
Harley Davidson, Inc. 1,400 80,500
Home Depot, Inc. 6,200 385,950
Lancaster Colony Corp. 900 23,963
Lowes Companies, Inc. 1,900 114,950
May Department Stores Co. 1,950 76,294
Omnicom Group, Inc. 1,900 151,881
Ross Stores, Inc. 2,100 92,006
Staples, Inc. (#) 300 9,862
TJX Companies, Inc. 2,700 91,800
Viad Corp. 17,100 475,594
2,809,497
Consumer Staples - 13.1%
Alberto Culver Co. 2,100 49,088
Albertsons, Inc. 2,000 108,625
Avon Products, Inc. 700 32,943
Bergen Brunswig Corp. 5,700 114,000
Bestfoods (#) 900 42,300
<PAGE>
EQUITY SECURITIES (Cont'd) SHARES VALUE
Consumer Staples (Cont'd)
BHC Communications, Inc. 3,600 $441,900
Cardinal Health, Inc. 2,031 134,046
Colgate Palmolive Co. 1,900 174,800
CVS Corp. 800 38,000
Darden Restaurant, Inc. 15,100 311,438
Donnelley RR & Sons 15,300 492,469
General Mills, Inc. 5,100 385,369
Gillette Co. 4,800 285,300
Heinz (H. J.) Co. 5,000 236,875
Kellogg Co. 800 27,050
King World Productions, Inc. (#) 2,900 88,631
Mediaone Group, Inc. (#) 3,900 247,650
Safeway, Inc. (#) 2,000 102,625
Supervalu, Inc. 18,500 381,563
Time Warner, Inc. 4,400 312,675
Tupperware Corp. 5,200 93,600
Walgreen Co. 3,000 84,750
4,185,697
Energy - 0.7%
Anadarko Petroleum Corp. 2,100 79,275
Union Pacific Resources Group, Inc. 5,700 67,687
Varco International, Inc. (#) 6,800 75,650
222,612
Financial Services - 25.2%
Ambac Financial Group, Inc. 1,200 64,800
American General Corp. 2,400 169,200
American International Group, Inc. 6,027 727,007
Amresco, Inc. (#) 8,800 67,650
Aon Corp. 1,200 75,900
Apartment Investment & Management Co.4,200 152,250
Bank One Corp. 4,858 267,494
BankAmerica Corp. 747 52,757
Chase Manhattan Corp. 8,700 707,419
Comerica, Inc. 1,900 118,631
Conseco, Inc. 14,600 450,775
Countrywide Credit Industries, Inc. 4,500 168,750
Edwards (A.G.), Inc. 7,100 232,081
Equitable Companies, Inc. 600 42,000
Equity Office Properties Trust 15,500 394,281
Everest Reinsurance Holdings 1,600 49,900
Federal Home Loan Mortgage Corp. 4,700 268,487
Federal National Mortgage Assn. 8,400 581,700
Fifth Third Bancorp. 700 46,156
Finova Group, Inc. 300 15,562
Fremont General Corp. 8,400 160,125
Golden West Financial Corp. 1,000 95,500
Greenpoint Financial Corp. 1,700 59,075
Household International, Inc. 3,700 168,813
Jefferson Pilot Corp. 600 40,650
Keycorp 18,100 548,656
Liberty Property Trust 8,700 180,525
<PAGE>
EQUITY SECURITIES (Cont'd) SHARES VALUE
Financial Services (Cont'd)
Lincoln National Corp. 1,900 $187,862
Marsh & Mclennan Companies, Inc. 4,300 319,006
MBIA, Inc. 1,000 58,000
MBNA Corp. 4,000 95,500
Meditrust 13,200 164,175
National City Corp. 2,200 146,025
North Fork Bancorporation 15,400 325,325
Paine Webber Group, Inc. 2,600 103,675
PMI Group, Inc. 2,000 92,750
Prologis Trust 3,700 75,850
Providian Financial Corp. 900 99,000
Republic NY Corp. 600 27,675
Schwab Charles Corp. 900 86,512
Sallie Mae Holdings Corp, 2,100 87,675
Wells Fargo & Co. 7,000 245,438
8,020,612
Pharmaceutical & Health Care - 14.0%
Amgen, Inc. (#) 9,800 733,775
Becton Dickinson & Co. 3,600 137,925
Biogen, Inc. (#) 1,300 148,606
Dentsply International, Inc. 4,400 102,300
Genzyme Corp. (#) 1,700 85,744
Guidant Corp. 2,600 157,300
Johnson & Johnson 10,600 993,088
Merck & Co., Inc. 11,800 946,212
Mylan Labs, Inc. 2,800 76,825
Pfizer, Inc. 3,900 541,125
Rexall Sundown, Inc. 2,200 42,212
Schering Plough Corp. 7,600 420,375
Sybron International Corp. (#) 300 7,500
Wellpoint Health Networks, Inc. (#) 1,100 83,394
4,476,381
Technology - 20.7%
Adaptec, Inc. (#) 600 13,687
Adobe Systems, Inc. 1,700 96,475
America Online, Inc. (#) 3,000 438,000
Apple Computer (#) 2,300 82,656
Applied Materials, Inc. (#) 3,700 228,243
BMC Software, Inc.(#) 2,400 88,950
Cisco Systems, Inc. (#) 4,050 443,728
Computer Associates International, Inc. 2,300 81,794
Compuware Corp. (#) 700 16,713
Dell Computer Corp. (#) 6,000 245,250
EMC Corp. (#) 1,300 166,075
First Data Corp. 2,500 106,875
General Instrument Corp. (#) 100 3,031
Hewlett Packard Co. 4,700 318,719
Intel Corp. 8,500 1,012,563
International Business Machines Corp. 3,400 602,650
<PAGE>
EQUITY SECURITIES (Cont'd) SHARES VALUE
Technology (Cont'd)
Learning Company, Inc. (#) 1,600 $46,400
Lucent Technologies, Inc. 6,000 646,500
Micron Technology, Inc. 5,700 275,025
Microsoft Corp.(#) 11,000 985,875
Oracle Systems Corp.(#) 4,750 125,281
Sabre Group Holdings, Inc. (#) 1,100 49,912
Sun Microsystems, Inc. (#) 1,600 199,900
Tellabs, Inc. (#) 1,300 127,075
Xerox Corp. 3,800 202,825
Zilinx, Inc. (#) 100 4,056
6,608,258
Transportation - 0.9%
AMR Corp. (#) 800 46,850
Delta Air Lines, Inc. 1,300 90,350
Norfolk Southern Corp. 5,500 145,063
282,263
Utilities - 2.4%
Allgheny Energy, Inc. 3,100 91,450
Cinergy Corp. 8,400 231,000
Consolidated National Gas Co. 3,000 146,063
MCN Energy Group, Inc. 9,800 157,412
OGE Energy Corp. 1,600 36,100
Puget Souind Energy 3,700 85,374
747,399
Total Equity Securities (Cost $27,234,135) 31,735,479
TOTAL INVESTMENTS (Cost $27,234,135)
- 99.6% 31,735,479
Other assets and liabilities, net - 0.4%
139,171
Net Assets - 100% $31,874,650
(^) These certificates of deposit are fully insured by agencies of the
federal government.
(#) Non-income producing.
(*) Restricted securities represents, 2.8% of net assets for Balanced, 0.8%
for Bond, and 0.8% for Equity.
(v) See Note B.
(b) This security is in default.
Explanation of Guarantees: Abbreviations:
BPA: Bond Purchase Agreement AMBAC: American Municipal Bond Assurance Corp.
GA: Guarantee Agreement VRDN: Variable Rate Demand Notes
INSUR: Insurance MFH: Multi-family Housing
LOC: Letter of Credit COPs: Certificates of Participation
TOA: Tender Option Agreement
See notes to financial statements.
<PAGE>
statements of assets and liabilities
March 31, 1999
money
market Balanced bond
assets portfolio portfolio portfolio
Investments in securities,
at value $192,514,865 $779,927,447 $71,040,162
Cash . . . . . 449,940 269,994 402,105
Receivable for securities sold -- 9,268,461 1,586,480
Receivable for shares sold 334,705 507,271 156,518
Interest & dividends receivable 1,315,337 5,127,151 948,137
Other assets 14,423 50,827 14,621
Total assets 194,629,270 795,151,151 74,148,023
liabilities
Payable for securities purchased -- 16,910,329 4,003,343
Payable for shares redeemed 71,621 736,974 6,048
Payable to Calvert Asset
Management, Inc. 95,594 450,040 39,391
Payable to Calvert Shareholders
Services, Inc. 19,940 21,749 3,126
Payable to Calvert Administrative
Services, Inc. -- 180,524 11,930
Payable to Calvert Distributors, Inc. 32,872 170,476 14,062
Accrued expenses and
other liabilities 114,644 280,879 33,107
Total liabilities 334,671 18,750,971 4,111,007
Net Assets $194,294,599 $776,400,180 $70,037,016
net assets consist of:
Paid-in capital applicable to the following shares of beneficial
interest, unlimited number of no par value shares authorized:
Money Market Portfolio:
194,369,805
shares outstanding $194,347,720
Balanced Portfolio:
Class A: 22,621,283
shares outstanding $613,752,601
Class B: 200,889
shares outstanding 6,696,999
Class C: 422,579
shares outstanding 13,092,864
Class I: 34,440
shares outstanding 1,119,907
Bond Portfolio:
Class A: 4,176,600
shares outstanding $67,754,817
Class B: 116,300 shares outstanding 1,916,179
Class C: 84,867 shares outstanding 1,391,381
Undistributed net
investment income (2,479) 958,575 59,318
Accumulated net realized
gain (loss) on investments (50,642) 27,624,745 (323,423)
Net unrealized appreciation (depreciation)
on investments and assets and liabilities
in foreign currencies -- 113,154,489 (761,256)
Net Assets $194,294,599 $776,400,180 $70,037,016
net asset value per share
Money Market Portfolio $1.00
Balanced Portfolio:
Class A: (based on net
assets of $754,673,414) . $33.36
Class B: (based on net
assets of $6,672,089) $33.21
Class C: (based on net
assets of $13,905,606) $32.91
Class I: (based on net
assets of $1,149,071) $33.36
Bond Portfolio:
Class A: (based on net assets of $66,829,237) $16.00
Class B: (based on net assets of $1,854,750)
$15.95
Class C: (based on net assets of $1,353,029)
$15.94
See notes to financial statements.
<PAGE>
statements of assets and liabilities
March 31, 1999
managed
equity index
assets portfolio portfolio
Investments in securities, at value $178,216,578 $31,735,479
Cash . . . 299,043 707,757
Receivable for securities sold -- 5,574,236
Receivable for shares sold 258,276 123,705
Interest & dividends receivable 102,599 28,515
Other assets 19,637 19,517
Total assets 178,896,133 38,189,209
liabilities
Payable for securities purchased -- 6,271,258
Payable for shares redeemed 261,539 6,022
Payable to Calvert Asset Management, Inc. 115,341 19,669
Payable to Calvert Administrative
Service Company 30,121 1,699
Payable to Calvert Shareholders
Services, Inc. 10,850 984
Payable to Calvert Distributors, Inc. 42,459 5,133
Accrued expenses and other liabilities 65,598 9,794
Total liabilities 525,908 6,314,559
Net Assets $178,370,225 $31,874,650
net assets consist of:
Paid-in capital applicable to the following shares of beneficial
interest, unlimited number of no par value shares authorized:
Equity Portfolio
Class A: 5,987,652
shares outstanding $120,255,395
Class B: 150,995
shares outstanding 3,701,266
Class C: 320,054
shares outstanding 7,038,706
Managed Index Portfolio
Class A: 552,599 shares outstanding $8,451,762
Class B: 167,692 shares outstanding 2,543,463
Class C: 73,425 shares outstanding 1,141,998
Class I: 1,103,091 shares outstanding 16,549,787
Undistributed net investment income (loss) (232,787) 20,541
Accumulated net realized
gain (loss) on investments 6,626,486 (1,334,245)
Net unrealized appreciation
(depreciation) on investments 40,981,159 4,501,344
Net Assets $178,370,225 $31,874,650
net asset value per share
Equity Portfolio:
Class A (based on net
assets of $166,000,624) $27.72
Class B (based on net
assets of $4,136,632) $27.40
Class C (based on net
assets of $8,232,969) $25.72
Managed Index Portfolio:
Class A (based on net assets of $9,288,634) $16.81
Class B (based on net assets of $2,795,874) $16.67
Class C (based on net assets of $1,226,829) $16.71
Class I (based on net assets of $18,563,313) $16.83
See notes to financial statements.
<PAGE>
Statements of Operations
six months Ended march 31, 1999
Money
Market Balanced Bond
Net Investment Income Portfolio Portfolio Portfolio
Investment Income:
Interest income $4,895,042 $9,963,778 $2,293,200
Dividend income -- 1,714,867 38,302
Total investment income 4,895,042 11,678,645 2,331,502
Expenses:
Investment advisory fee 422,380 2,200,608 177,176
Transfer agency
fees and expenses 235,113 506,321 73,469
Administrative fees 32,872 180,524 11,930
Distribution Plan expenses:
Class A -- 859,812 66,575
Class B -- 22,067 6,447
Class C -- 63,064 4,505
Trustees' fees and expenses 23,880 94,223 9,156
Custodian fees 18,595 69,116 16,275
Registration fees 17,007 42,230 23,212
Reports to shareholders 47,828 110,841 11,563
Professional fees 15,175 71,086 5,720
Miscellaneous 15,276 65,910 6,544
Total expenses 828,126 4,285,802 412,572
Reimbursement from Advisor:
Class O (15,186) -- --
Class A -- -- --
Class B -- (3,434) (4,999)
Class C -- -- (3,105)
Class I -- (627) --
Fees paid indirectly (16,249) (55,483) (19,312)
Net expenses 796,691 4,226,258 385,156
Net Investment Income 4,098,351 7,452,387 1,946,346
Realized and Unrealized
Gain (Loss) on Investments
Net realized gain (loss) on:
Investments (21,777) 29,077,993 (95,383)
Foreign currency transactions -- 1,943 --
(21,777) 29,079,936 (95,383)
Change in unrealized appreciation or (depreciation):
Securities -- 63,606,036 (1,250,539)
Assets and liabilities denominated
in foreign currencies -- (4,772) --
-- 63,601,264 (1,250,539)
Net Realized and Unrealized
Gain (Loss)
on Investments (21,777) 92,681,200 (1,345,922)
Increase (Decrease) in Net Assets
Resulting From Operations $4,076,574 $100,133,587 $600,424
See notes to financial statements.
<PAGE>
Statements of Operations
six months Ended March 31, 1999
Equity Managed Index
Net Investment Income Portfolio Portfolio
Investment Income:
Interest income $635,086 --
Dividend income 38,119 $187,171
Total investment income 673,205 187,171
Expenses:
Investment advisory fee 421,262 79,840
Transfer agency fees and expenses 198,166 18,543
Administrative fees 30,121 15,636
Distribution Plan expenses:
Class A 172,881 8,382
Class B 13,907 9,441
Class C 35,608 3,619
Trustees' fees and expenses 20,208 3,075
Custodian fees 14,550 14,641
Registration fees 22,683 21,527
Reports to shareholders 38,727 939
Professional fees 13,426 (2,366)
Miscellaneous 19,128 1,670
Total expenses 1,000,667 174,947
Reimbursement from Advisor:
Class A -- (11,970)
Class B (584) (5,261)
Class C -- (1,635)
Class I -- (8,284)
Fees paid indirectly (94,091) (8,380)
Net expenses 905,992 139,417
Net Investment Income (Loss) (232,787) 47,754
Realized and Unrealized
Gain (Loss) on Investments
Net realized gain (loss) 10,098,175 (1,229,343)
Change in unrealized appreciation
or (depreciation) 38,285,450 6,568,219
Net Realized and Unrealized
Gain (Loss) on Investments 48,383,625 5,338,876
Increase (Decrease) in Net Assets
Resulting From Operations $48,150,838 $5,386,630
See notes to financial statements.
<PAGE>
Money Market Portfolio
Statements of Changes in Net Assets
Six Months Ended Year Ended
March 31, September 30,
Increase (Decrease) in Net Assets 1999 1998
Operations:
Net investment income $4,098,351 $8,321,421
Net realized gain (loss) (21,777) 1,009
Increase (Decrease) in Net Assets
Resulting From Operations 4,076,574 8,322,430
Distributions to shareholders from
Net investment income (4,113,413) (8,308,855)
Capital share transactions:
Shares sold 109,100,915 154,779,292
Reinvestment of distributions 3,838,983 7,819,897
Shares redeemed (91,308,984) (156,022,801)
21,630,914 6,576,388
Total Increase (Decrease) in Net Assets 21,594,075 6,589,963
Net Assets
Beginning of period 172,700,524 166,110,561
End of period (including undistributed net investment
income (loss) of $(2,479)
and $12,853, respectively) $194,294,599 $172,700,524
Capital Share Activity
Shares sold 109,100,915 154,779,292
Reinvestment of distributions 3,838,983 7,819,897
Shares redeemed (91,308,984) (156,022,801)
Total capital share activity 21,630,914 6,576,388
See notes to financial statements.
<PAGE>
Balanced Portfolio
Statements of Changes in Net Assets
Six Months Ended Year Ended
March 31, September 30,
Increase (Decrease) in Net Assets 1999 1998
Operations:
Net investment income $7,452,387 $15,843,294
Net realized gain (loss) 29,079,936 76,966,372
Change in net unrealized
appreciation or (depreciation) 63,601,264 (55,906,082)
Increase (Decrease) in Net Assets
Resulting From Operations 100,133,587 36,903,584
Distributions to shareholders from
Net investment income:
Class A Shares (7,323,995) (15,407,301)
Class B Shares (26,527) (13,826)
Class C Shares (64,013) (132,534)
Class I Shares (5,510) --
Net realized gain:
Class A Shares (69,564,483) (64,690,996)
Class B Shares (412,084)
Class C Shares (1,218,576) (945,605)
Total distributions (78,615,188) (81,190,262)
Capital share transactions:
Shares sold:
Class A Shares 61,789,002 68,087,988
Class B Shares 3,828,467 2,658,548
Class C Shares 2,068,584 4,076,426
Class I Shares 1,121,828 --
Reinvestment of distributions:
Class A Shares 71,166,746 74,176,448
Class B Shares 401,900 12,756
Class C Shares 1,249,053 1,056,857
Class I Shares 5,510 __
Shares redeemed:
Class A Shares (73,241,080) (100,217,586)
Class B Shares (193,985) (10,687)
Class C Shares (1,236,675) (1,828,205)
Class I Shares (7,431) --
Total capital share transactions 66,951,919 48,012,545
Total Increase (Decrease) in Net Assets 88,470,318 3,725,867
Net Assets
Beginning of period 687,929,862 684,203,995
End of period (including undistributed net investment
income of $958,575
and $926,233, respectively) $776,400,180 $687,929,862
See notes to financial statements.
<PAGE>
Balanced Portfolio (Cont'd)
Six Months Ended Year Ended
March 31 September 30,
Capital Share Activity 1999 1998
Shares sold:
Class A Shares 1,864,428 2,018,239
Class B Shares 115,784 78,358
Class C Shares 63,114 121,111
Class I Shares 34,496 --
Reinvestment of distributions:
Class A Shares 2,199,664 2,377,203
Class B Shares 12,471 385
Class C Shares 39,152 34,413
Class I Shares 165 --
Shares redeemed:
Class A Shares (2,211,163) (2,988,777)
Class B Shares (5,806) (303)
Class C Shares (37,940) (55,002)
Class I Shares (221) --
Total capital share activity 2,074,144 1,585,627
See notes to financial statements.
<PAGE>
Bond Portfolio
Statements of Changes in Net Assets
Six Months Ended Year Ended
March 31, September 30,
Increase (Decrease) in Net Assets 1999 1998
Operations:
Net investment income $1,946,346 $3,567,253
Net realized gain (loss) (95,383) 2,273,322
Change in net unrealized
appreciation or (depreciation) (1,250,539) (735,972)
Increase (Decrease) in Net Assets
Resulting From Operations 600,424 5,104,603
Distributions to shareholders from
Net investment income:
Class A Shares (1,905,094) (3,574,287)
Class B Shares (29,287) (6,098)
Class C Shares (22,090) (4,656)
Net Realized Gain:
Class A Shares (2,196,195) (599,165)
Class B Shares (46,303) --
Class C Shares (21,407) --
Total distributions (4,220,376) (4,184,206)
Capital share transactions:
Shares sold:
Class A Shares 9,774,367 13,656,586
Class B Shares 1,437,996 567,123
Class C Shares 1,209,508 651,468
Reinvestment of distributions:
Class A Shares 3,338,072 3,302,128
Class B Shares 65,315 3,781
Class C Shares 40,530 4,537
Shares redeemed:
Class A Shares (8,572,076) (11,726,163)
Class B Shares (141,915) (16,121)
Class C Shares (257,462) (257,200)
Total capital share transactions 6,894,335 6,186,139
Total Increase (Decrease)
In Net Assets 3,274,383 7,106,536
Net Assets
Beginning of period 66,762,633 59,656,097
End of period (including undistributed net investment
income of $59,318 and
$69,443, respectively) $70,037,016 $66,762,633
<PAGE>
Bond Portfolio (Cont'd)
Six Months Ended Year Ended
March 31, September 30,
Capital Share Activity 1999 1998
Shares sold:
Class A Shares 599,669 813,667
Class B Shares 87,784 33,817
Class C Shares 74,696 38,777
Reinvestment of distributions:
Class A Shares 206,859 197,486
Class B Shares 4,070 226
Class C Shares 2,524 272
Shares redeemed:
Class A Shares (527,394) (698,634)
Class B Shares (8,635) (962)
Class C Shares (16,050) (15,352)
Total capital share activity 423,523 369,297
See notes to financial statements.
<PAGE>
Equity Portfolio
Statements of Changes in Net Assets
Six Months Ended Year Ended
March 31, September 30,
Increase (Decrease) in Net Assets 1999 1998
Operations:
Net investment income (loss) $(232,787) $(308,492)
Net realized gain (loss) 10,098,175 609,268
Change in net unrealized
appreciation or (depreciation) 38,285,450 (26,063,542)
Increase (Decrease) in Net Assets
Resulting From Operations 48,150,838 (25,762,766)
Distributions to shareholders from
Net realized gain:
Class A Shares (83,432) (18,421,731)
Class B Shares (1,577) --
Class C Shares (4,329) (881,454)
Total distributions (89,338) (19,303,185)
Capital share transactions:
Shares sold:
Class A Shares 10,969,561 32,530,473
Class B Shares 1,810,545 2,076,520
Class C Shares 1,054,726 3,144,295
Reinvestment of distributions:
Class A Shares 83,962 16,511,336
Class B Shares 1,161 --
Class C Shares 4,064 847,807
Shares redeemed:
Class A Shares (18,951,066) (24,740,783)
Class B Shares (111,521) (75,439)
Class C Shares (887,209) (2,144,660)
Total capital share transactions (6,025,777) 28,149,549
Total Increase (Decrease) in Net Assets 42,035,723 (16,916,402)
Net Assets
Beginning of period 136,334,502 153,250,904
End of period (including undistributed net investment
income (loss) of $(232,787)
and $0, respectively) $178,370,225 $136,334,502
See notes to financial statements.
<PAGE>
Equity Portfolio (Cont'd)
Six Months Ended Year Ended
March 31, September 30,
Capital Share Activity 1999 1998
Shares sold:
Class A Shares 441,994 1,437,044
Class B Shares 72,928 --
Class C Shares 44,646 122,108
Reinvestment of distributions:
Class A Shares 3,350 273,375
Class B Shares 47 --
Class C Shares 175 10,163
Shares redeemed:
Class A Shares (777,528) (911,939)
Class B Shares (4,427) --
Class C Shares (39,635) (33,306)
Total capital share activity (258,450) 897,445
See notes to financial statements.
<PAGE>
Managed Index Portfolio
Statement of Changes in Net Assets
From Inception
Six Months 4/15/98
Ended Through
Increase (Decrease) in Net Assets 3/31/99 9/30/98
Operations:
Net investment income (loss) $47,754 $42,792
Net realized gain (loss) (1,229,343) (104,902)
Change in net unrealized
appreciation or (depreciation) 6,568,219 (2,066,875)
Increase (Decrease) in Net Assets
Resulting From Operations 5,386,630 (2,128,985)
Distributions to shareholders from
Net investment income:
Class A Shares (20,043) --
Class I Shares (49,962) --
Total distributions (70,005) --
Capital share transactions:
Shares sold:
Class A Shares 4,325,084 5,107,452
Class B Shares 1,550,893 1,062,922
Class C Shares 771,860 455,574
Class I Shares -- 16,515,346
Reinvestment of distributions
Class A Shares 18,852 --
Class I Shares 49,946 --
Shares redeemed:
Class A Shares (704,118) (295,508)
Class B Shares (67,069) (3,283)
Class C Shares (56,599) (28,837)
Class I Shares -- (15,505)
Total capital share transactions 5,888,849 22,798,161
Total Increase (Decrease)
in Net Assets 11,205,474 20,669,176
Net Assets
Beginning of period 20,669,176 --
End of period (including undistributed net investment
income of $20,541 and
$42,792, respectively) $31,874,650 $20,669,176
<PAGE>
Managed Index Portfolio (Cont'd)
Six Months Ended Year Ended
March 31, September 30,
Capital Share Activity 1999 1998
Shares sold:
Class A Shares 272,083 346,063
Class B Shares 99,516 72,487
Class C Shares 47,479 31,384
Class I Shares -- 1,101,064
Reinvestment of distributions:
Class A Shares 1,165 --
Class I Shares 3,084 --
Shares redeemed:
Class A Shares (45,567) (21,145)
Class B Shares (4,096) (215)
Class C Shares (3,417) (2,021)
Class I Shares -- (1,057)
Total capital share activity 370,247 1,526,560
See notes to financial statements.
<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 an open-end management investment
company. The Fund operates as a series fund with five separate portfolios:
Money Market, Balanced, Bond, Equity and Managed Index. Money Market,
Balanced, Equity and Managed Index are registered as diversified portfolios
and Bond as a non-diversified portfolio. Money Market shares are sold
without sales charge. Balanced, Bond, Equity and Managed Index offers Class
A, Class B and Class C shares. Balanced and Managed Index also offers Class
I shares. Class A shares are sold with a maximum front-end sales charge of
4.75% (3.75% for Bond). Class B shares are sold without a front-end sales
charge. With certain exceptions, the Fund will impose a deferred sales
charge at the time of redemption, depending on how long you have owned the
shares. Class C shares are sold without a front-end sales charge. With
certain exceptions, the Fund will impose a deferred sales charge on shares
sold within one year of purchase. Class B and Class C shares have higher
level of expenses than Class A shares. Effective March 1, 1999, the Balanced
began to offer Class I shares. Class I shares require a minimum account
balance of $1,000,000. Class I shares have no front-end or deferred sales
charge. Each class has different: (a) dividend rates, due to Distribution
Plan expenses and other class-specific expenses, (b) exchange privileges and
(c) class-specific voting rights.
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. Further,
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 March 31 1999, $21,145,409 or 2.7% of net assets, for Balanced,
$1,326,368 or 1.9% for Bond, and $1,366,355 or 0.8% for Equity 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 from writing or purchasing option securities arise
from possible illiquidity of the options market and the movement in the
value of the investment or in interest rates. The risk associated with
purchasing options is limited to the premium originally paid.
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 translated 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 accrued
daily and paid monthly by Money Market and Bond, quarterly by Balanced and
annually
by Equity and Managed Index. 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 Arrangements: The Fund has an arrangement with its custodian
bank whereby the custodian's and transfer agent's fees are paid indirectly
by credits earned on each Portfolio's cash on deposit with the bank. Such a
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
Ameritas Acacia Mutual Holding 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:
10/1/98 - 2/28/99 Effective 3/1/99
Money Market .50% .30%
Bond .65% .35%
Balanced:
First $500 Million .70% .425%
Next $500 Million .675% .40%
Over $1 Billion .65% .375%
Equity .70% .50%
Managed Index .60% .60%
Equity pays 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 Standard & Poor's 500 Index Total
Return. For the period ended March 31, 1999, the performance fee adjustment
decreased advisory fees by $109,437. Balanced pays 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
Lipper Balanced Fund Index. For the period ended March 31, 1999, the
performance fee adjustment decreased advisory fees by $161,637. Performance
fees for Equity and Balanced were eliminated effective February 28, 1999.
Calvert Distributors, Inc., an affiliate of the Advisor, is the distributor
and principal underwriter for the Fund. Distribution Plans, adopted by Class
A, Class B, and Class C shares, allow the Portfolios to pay the distributor
for expenses and services associated with distribution of shares. The
expenses of Money Market are limited to .25% annually of average daily net
assets. The expenses paid may not exceed .35%, 1.0%, and 1.0% annually of
average daily net assets of each Class A, Class B, and Class C for Balanced,
Bond and Equity, respectively. The expenses paid may not exceed .25%, 1.0%,
and 1.0% annually of average daily net assets of each Class A, Class B, and
Class C for Managed Index. Class I for Balanced and Managed Index does not
have Distribution Plan expenses.
The Distributor received the following front-end sales charges (net of
dealer reallowances and contingent deferred sales charges): $145,280 for
Balanced, $26,403 for Bond, $57,574 for Equity, and $16,225 for Managed
Index.
Calvert Shareholder Services, Inc. (CSSI), an affiliate of the Advisor, is
the shareholder servicing agent for the Fund. For its services, CSSI
received fees of $120,861, $139,858, $19,401, $65,609, and $4,083 for the
six months ended March 31, 1999 for Money Market, Balanced, Bond, Equity and
Managed Index, respectively. National Financial Data Services, Inc., is the
transfer and dividend disbursing agent.
Calvert Administrative Services Company (CASC), and affiliate of the
Advisor, provides administrative services for the Fund. For providing such
services, CASC receives an annual fee, payable monthly, from Managed Index
of 0.15% (0.10% for Class I shares) of the average daily net assets.
Effective March 1, 1999 CASC receives a monthly fee based on the following
annual rates of average daily net assets:
Money Market .20%
Balanced (Class A, B, & C) .275%
Balanced (Class I) .125%
Bond (Class A, B, & C) .30%
Equity (Class A, B, & C) .20%
Managed Index (Class A, B, & C) .15%
Managed Index (Class I) .10%
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 Balanced owns over
33% of the voting securities, was purchased at a cost of $6,261,630 for
22,670,603 shares.
Note C -- Investment Activity
During the period, purchases and sales of investments, other than short-term
securities, were:
Managed
Balanced Bond Equity Index
Purchases: $559,742,210 $156,159,724 $44,728,259 $17,767,693
Sales: 565,068,480 148,556,945 50,197,796 11,476,731
Money Market held only short-term investments.
<PAGE>
The cost of investments owned at March 31, 1999 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
March 31, 1999 and the net realized capital loss carryforwards as of
September 30, 1998 with expiration dates:
Money Managed Managed
Market Growth Bond Equity Index
Unrealized appreciation -- $136,004,888
$404,381 $44,026,365 $5,352,192
Unrealized (depreciation) -- 22,849,701
1,165,637 3,045,206 850,848
Capital loss carryforward $29,000 --
- -- -- --
Expiration dates 1999-2004 --
- -- -- --
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
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. The Fund had no loans outstanding pursuant to this line
of credit at March 31, 1999.
<PAGE>
Money Market Portfolio
Financial Highlights
Periods Ended
March 31, September 30, September 30,
1999 1998 1997
Net asset value, beginning $1.00 $1.00 $1.00
Income from investment operations
Net investment income .023 .049 .048
Distributions from
Net investment income (.023) (.049) (.048)
Net asset value, ending $1.00 $1.00 $1.00
Total return* 2.28% 5.02% 4.89%
Ratios to average net assets:
Net investment income 4.50% (a) 4.92% 4.79%
Total expenses+ .89% (a) .89% .89%
Net expenses .87% (a) .87% .87%
Expenses reimbursed .02% (a) .05% .11%
Net assets, ending (in thousands) $194,295 $172,701 $166,111
Number of shares outstanding,
ending (in thousands) 194,370 172,739 166,163
Years Ended
September 30, September 30, September 30,
1996 1995 1994
Net asset value, beginning $1.00 $1.00 $1.00
Income from investment operations
Net investment income .048 .050 .031
Distributions from
Net investment income (.048) (.050) (.031)
Net asset value, ending $1.00 $1.00 $1.00
Total return* 4.88% 5.13% 3.13%
Ratios to average net assets:
Net investment income 4.77% 5.03% 3.07%
Total expenses+ .89% .89% N/A
Net expenses .87% .87% .87%
Expenses reimbursed .21% .18% .18%
Net assets, ending
(in thousands) $166,516 $153,996 $143,779
Number of shares outstanding,
ending (in thousands) 166,569 154,044 143,826
<PAGE>
Balanced Portfolio
Financial Highlights
Periods Ended
March 31, September 30, September 30,
Class A Shares 1999 1998 1997
Net asset value, beginning $32.45 $34.88 $31.35
Income from investment operations
Net investment income .34 .77 .83
Net realized and
unrealized gain (loss) 4.27 .92 5.61
Total from investment
operations 4.61 1.69 6.44
Distributions from
Net investment income (.34) (.76) (.81)
Net realized gain (3.36) (3.36) (2.10)
Total distributions (3.70) (4.12) (2.91)
Total increase (decrease)
in net asset value .91 (2.43) 3.53
Net asset value, ending $33.36 $32.45 $34.88
Total return* 14.61% 5.50% 21.94%
Ratios to average net assets:
Net investment income 2.05% (a) 2.27% 2.57%
Total expenses+ 1.14% (a) 1.13% 1.14%
Net expenses 1.12% (a) 1.11% 1.12%
Expenses reimbursed -- -- --
Portfolio turnover 78% 185% 215%
Net assets, ending
(in thousands) $754,673 $673,907 $675,306
Number of shares outstanding,
ending (in thousands) 22,621 20,768 19,362
Years Ended September 30,
Class A Shares 1996 1995 1994
Net asset value, beginning $32.81 $28.77 $30.85
Income from investment operations
Net investment income .78 .87 .93
Net realized and unrealized
gain (loss) 2.28 4.25 (1.83)
Total from investment
operations 3.06 5.12 (.90)
Distributions from
Net investment income (.77) (.87) (.95)
Net realized gain (3.75 (.21) (.23)
Total distributions (4.52) (1.08) (1.18)
Total increase (decrease) in net
asset value (1.46) 4.04 (2.08)
Net asset value, ending $31.35 $32.81 $28.77
Total return* 10.27% 18.21% (2.95%)
Ratios to average net assets:
Net investment income 2.58% 2.89% 3.14%
Total expenses+ 1.28% 1.28% N/A
Net expenses 1.26% 1.26% 1.24%
Expenses reimbursed .01% .02% --
Portfolio turnover 111% 114% 34%
Net assets, ending (in thousands) $594,482 $560,981 $512,027
Number of shares outstanding,
ending (in thousands) 18,964 17,099 17,800
<PAGE>
Balanced Portfolio
Financial Highlights
Period Ended
March 31, September 30,
Class B Shares 1999 1998 #
Net asset value, beginning $32.38 $34.37
Income from investment operations
Net investment income .17 0.15
Net realized and unrealized gain (loss) 4.20 (1.90)
Total from investment operations 4.37 (1.75)
Distributions from
Net investment income (.18) (0.24)
Net realized gain (3.36) --
Total distributions (3.54) (0.24)
Total increase (decrease) in net asset value .83
(1.99)
Net asset value, ending $33.21 $32.38
Total return* 13.84% (5.10%)
Ratios to average net assets:
Net investment income .63% (a) 1.22%(a)
Total expenses+ 2.55% (a) 2.43%(a)
Net expenses 2.52% (a) 2.41%(a)
Expenses reimbursed .16% (a) 1.16%(a)
Portfolio turnover 78% 185%
Net assets, ending (in thousands) $6,672 $2,540
Number of shares outstanding,
ending (in thousands) 201 78
<PAGE>
Balanced Portfolio
Financial Highlights
Periods Ended
March 31, September 30, September 30,
Class C Shares 1999 1998 1997
Net asset value, beginning $32.05 $34.52 $31.05
Income from investment operations
Net investment income .19 .41 .47
Net realized and
unrealized gain (loss) 4.20 .89 5.54
Total from investment
operations 4.39 1.30 6.01
Distributions from
Net investment income (.17) (.41) (.44)
Net realized gain (3.36) (3.36) (2.10)
Total distributions (3.53) (3.77) (2.54)
Total increase (decrease)
in net asset value .86 (2.47) 3.47
Net asset value, ending $32.91 $32.05 $34.52
Total return* 14.08% 4.35% 20.56%
Ratios to average net assets:
Net investment income 1.02% (a) 1.16% 1.42%
Total expenses+ 2.17% (a) 2.25% 2.29%
Net expenses 2.15% (a) 2.23% 2.27%
Expenses reimbursed -- -- --
Portfolio turnover 78% 185% 215%
Net assets, ending (in thousands) $13,906 $11,483 $8,898
Number of shares outstanding,
ending (in thousands) 423 358 258
Years Ended
September 30, September 30, September 30,
Class C Shares 1996 1995 1994^
Net asset value, beginning $32.60 $28.65 $30.43
Income from investment operations
Net investment income .46 .54 .51
Net realized and
unrealized gain (loss) 2.17 4.20 (1.66)
Total from investment
operations 2.63 4.74 (1.15)
Distributions from
Net investment income (.43) (.58) (.63)
Net realized gain (3.75) (.21) --
Total distributions (4.18) (.79) (.63)
Total increase (decrease)
in net asset value (1.55) 3.95 (1.78)
Net asset value, ending $31.05 $32.60 $28.65
Total return* 8.85% 16.85% (3.30%)
Ratios to average net assets:
Net investment income 1.34% 1.61% 1.83%(a)
Total expenses+ 2.52% 2.51% N/A
Net expenses 2.50% 2.50% 2.47%(a)
Expenses reimbursed .14% .42% 1.46%(a)
Portfolio turnover 111% 114% 34%
Net assets, ending (in thousands) $6,715 $4,065 $1,893
Number of shares outstanding,
ending (in thousands) 216 125 66
<PAGE>
Balanced Portfolio
Financial Highlights
Period Ended
March 31,
Class I Shares 1999###
Net asset value, beginning $32.52
Income from investment operations
Net investment income .06
Net realized and unrealized gain (loss) .94
Total from investment operations 1.00
Distributions from
Net investment income (.16)
Net realized gain --
Total distributions (.16)
Total increase (decrease) in net asset value
.84
Net asset value, ending $33.36
Total return* 3.08%
Ratios to average net assets:
Net investment income 2.10% (a)
Total expenses+ .76% (a)
Net expenses .75% (a)
Expenses reimbursed .64% (a)
Portfolio turnover 78%
Net assets, ending (in thousands) $1,149
Number of shares outstanding,
ending (in thousands) 34
<PAGE>
Bond Portfolio
Financial Highlights
Periods Ended
March 31, September 30, September 30,
Class A Shares 1999 1998 1997
Net asset value, beginning $16.88 $16.64 $16.06
Income from investment operations
Net investment income .46 .95 .96
Net realized and unrealized
gain (loss) (.33) .41 .58
Total from investment
operations .13 1.36 1.54
Distributions from
Net investment income (.46) (.96) (.96)
Net realized gain (.55) (.16) --
Total distributions (1.01) (1.12) (.96)
Total increase (decrease)
in net asset value (.88) .24 .58
Net asset value, ending $16.00 $16.88 $16.64
Total return* .85% 8.46% 9.89%
Ratios to average net assets:
Net investment income 5.70% (a) 5.69% 5.85%
Total expenses+ 1.13% (a) 1.14% 1.23%
Net expenses 1.07% (a) 1.07% 1.19%
Portfolio turnover 224% 620% 319%
Net assets, ending (in thousands) $66,829 $65,807 $59,656
Number of shares outstanding,
ending (in thousands) 4,177 3,897 3,585
Years Ended
September 30, September 30, September 30,
Class A Shares 1996 1995 1994
Net asset value, beginning $16.34 $15.49 $17.77
Income from investment operations
Net investment income .92 .96 .94
Net realized and
unrealized gain (loss) (.29) .91 (1.81)
Total from investment
operations .63 1.87 (.87)
Distributions from
Net investment income (.91) (.93) (.94)
Net realized gain -- (.06) (.47)
Tax return of capital -- (.03) --
Total distributions (.91) (1.02) (1.41)
Total increase (decrease)
in net asset value (.28) .85 (2.28)
Net asset value, ending $16.06 $16.34 $15.49
Total return* 3.96% 12.57% (5.18%)
Ratios to average net assets:
Net investment income 5.60% 6.04% 5.64%
Total expenses+ 1.29% 1.24% N/A
Net expenses 1.26% 1.22% 1.10%
Portfolio turnover 22% 29% 19%
Net assets, ending (in thousands) $62,259 $62,929 $61,573
Number of shares outstanding,
ending (in thousands) 3,876 3,850 3,976
<PAGE>
Bond Portfolio
Financial Highlights
Period Ended
March 31, September 30
Class B Shares 1999 1998#
Net asset value, beginning $16.84 $16.69
Income from investment operations
Net investment income .39 .36
Net realized and unrealized gain (loss) (.37) .19
Total from investment operations .02 .55
Distributions from
Net investment income (.36) (.40)
Net realized gain (.55)
Total distributions (.91)
Total increase (decrease) in net asset value (.89)
.15
Net asset value, ending $15.95 $16.84
Total return* .14% 3.36%
Ratios to average net assets:
Net investment income 4.33% (a) 4.14%(a)
Total expenses+ 2.57% (a) 2.55%(a)
Net expenses 2.50% (a) 2.50%(a)
Expenses reimbursed .78% (a) 5.53%(a)
Portfolio turnover 224% 620%
Net assets, ending (in thousands) $1,855 $557
Number of shares outstanding,
ending (in thousands) 116 33
Period Ended
March 31, September 30,
Class C Shares 1999 1998^^
Net asset value, beginning $16.84 $16.81
Income from investment operations
Net investment income .38 .21
Net realized and unrealized gain (loss) (.37) .08
Total from investment operations .01 .29
Distributions from
Net investment income (.36) (.26)
Net realized gain (.55)
Total distributions (.91)
Total increase (decrease) in net asset value (.90)
.03
Net asset value, ending $15.94 $16.84
Total return* .10% 1.75%
Ratios to average net assets:
Net investment income 4.34% (a) 4.06%(a)
Total expenses+ 2.55% (a) 2.74%(a)
Net expenses 2.50% (a) 2.50%(a)
Expenses reimbursed .69% (a) 4.35%(a)
Portfolio turnover 224% 620%
Net assets, ending (in thousands) $1,353 $399
Number of shares outstanding,
ending (in thousands) 85 24
<PAGE>
Equity Portfolio
Financial Highlights
Periods Ended
`March 31, September 30, September 30,
Class A Shares 1999 1998 1997
Net asset value, beginning $20.36 $27.77 $22.54
Income from investment operations
Net investment income (.03) (.04) --
Net realized and
unrealized gain (loss) 7.40 (4.01) 6.73
Total from investment
operations 7.37 (4.05) 6.73
Distributions from
Net investment income -- -- (.01)
Net realized gain (.01) (3.36) (1.49)
Total distributions (.01) (3.36) (1.50)
Total increase (decrease) in
net asset value 7.36 (7.41) $5.23
Net asset value, ending $27.72 $20.36 $27.77
Total return* 36.23% (15.70%) 31.34%
Ratios to average net assets:
Net investment income (.22%) (a) (.14%) .03%
Total expenses+ 1.18% (a) 1.16% 1.21%
Net expenses 1.06% (a) 1.07% 1.20%
Portfolio turnover 29% 110% 93%
Net assets, ending (in thousands) $166,000 $128,683 $147,002
Number of shares outstanding,
ending (in thousands) 5,988 6,320 5,294
Years Ended
September 30, September 30, September 30,
Class A Shares 1996 1995 1994
Net asset value, beginning $21.12 $20.13 $21.43
Income from investment operations
Net investment income .03 .06 .13
Net realized and unrealized gain (loss) 3.26 2.22 (1.04)
Total from investment operations 3.29 2.28 (.91)
Distributions from
Net investment income (.06) (.04) (.28)
Net realized gain (1.81) (1.25) (.11)
Total distributions (1.87) (1.29) (.39)
Total increase (decrease)
in net asset value 1.42 .99 (1.30)
Net asset value, ending $22.54 $21.12 $20.13
Total return* 16.62% 12.43% (4.33%)
Ratios to average net assets:
Net investment income .15% .32% .65%%
Total expenses+ 1.29% 1.38% N/A
Net expenses 1.27% 1.36% 1.27%
Portfolio turnover 118% 35% 94%
Net assets, ending (in thousands) $101,344 $90,951 $92,970
Number of shares outstanding,
ending (in thousands) 4,496 4,307 4,620
<PAGE>
Equity Portfolio
Financial Highlights
Period Ended
March 31, September 30,
Class B Shares 1999 1998 #
Net asset value, beginning $20.26 $26.01
Income from investment operations
Net investment income (.11) (.09)
Net realized and unrealized gain (loss) 7.26 (5.66)
Total from investment operations 7.15 (5.75)
Distributions from
Net realized gain (.01) --
Total increase (decrease) in net asset value 7.14
(5.75)
Net asset value, ending $27.40 $20.26
Total return* 35.32% (22.11%)
Ratios to average net assets:
Net investment income (1.64%) (a) (1.55%)(a)
Total expenses+ 2.70% (a) 3.19%(a)
Net expenses 2.50% (a) 2.56%(a)
Expenses reimbursed .04% (a) .93%(a)
Portfolio turnover 29% 110%
Net assets, ending (in thousands) $4,137 $1,670
Number of shares outstanding,
ending (in thousands) 151 82
<PAGE>
Equity Portfolio
Financial Highlights
Periods Ended
March 31, September 30, September 30,
Class C Shares 1999 1998 1997
Net asset value, beginning $19.00 $26.37 $21.71
Income from investment operations.
Net investment income (loss) (.13) (.16) (.05)
Net realized and unrealized
gain (loss) 6.86 (3.85) 6.21
Total from investment
operations 6.73 (4.01) 6.16
Distributions from
Net investment income -- -- (.01)
Net realized gain (.01) (3.36) (1.49)
Total distributions (.01) (3.36) (1.50)
Total increase (decrease)
in net asset value 6.72 (7.37) 4.66
Net asset value, ending $25.72 $19.00 $26.37
Total return* 35.45% (16.47%) 29.84%
Ratios to average net assets:
Net investment
income (loss) (1.20%) (a) (1.17%) (1.08%)
Total expenses+ 2.23% (a) 2.21% 2.31%
Net expenses 2.04% (a) 2.09% 2.30%
Portfolio turnover 29% 110% 93%
Net assets, ending (in thousands) $8,233 $5,981 $6,249
Number of shares outstanding,
ending (in thousands) 320 315 237
Years Ended
September 30, September 30, September 30,
Class C Shares 1996 1995 1994^
Net asset value, beginning $20.66 $19.98 $22.12
Income from investment operations.
Net investment income (.16) (.03) (.06)
Net realized and
unrealized gain (loss) 3.04 2.05 (2.08)
Total from investment operations 2.88 2.02 (2.14)
Distributions from
Net investment income (.02) (.09) --
Net realized gain (1.81) (1.25) --
Total distributions (1.83) (1.34) --
Total increase (decrease)
in net asset value 1.05 .68 (2.14)
Net asset value, ending $21.71 $20.66 $19.98
Total return* 14.85% 11.16% (9.14%)
Ratios to average net assets:
Net investment income (loss) (1.42%) (.84%) (1.06%)(a)
Total expenses+ 2.86% 2.51% N/A
Net expenses 2.85% 2.50% 2.75%(a)
Expenses reimbursed -- 1.07% 4.60%(a)
Portfolio turnover 118% 35% 94%
Net assets, ending (in thousands) $2,996 $1,802 $670
Number of shares outstanding,
ending (in thousands) 138 87 34
<PAGE>
Managed Index Portfolio
Financial Highlights
Period Ended
March 31, September 30,
Class A Shares 1999 1998 ##
Net asset value, beginning $13.54 $15.00
Income from investment operations
Net investment income .02 .02
Net realized and unrealized gain (loss) 3.30 (1.48)
Total from investment operations 3.32 (1.46)
Distributions from
Net investment income (.05) --
Total increase (decrease) in net asset value 3.27
(1.46)
Net asset value, ending $16.81 $13.54
Total return* 24.53% (9.73%)
Ratios to average net assets:
Net investment income .15% (a) .42%(a)
Total expenses+ 1.32% (a) 1.01%(a)
Net expenses 1.25% (a) .95%(a)
Expense reimbursed .36% (a) .85%(a)
Portfolio turnover 44% 27%
Net assets, ending (in thousands) $9,289 $4,401
Number of shares outstanding,
ending (in thousands) 553 325
Period Ended
March 31, September 30,
Class B Shares 1999 1998 ##
Net asset value, beginning $13.48 $15.00
Income from investment operations
Net investment income (.05) (.03)
Net realized and unrealized gain (loss) 3.24 (1.49)
Total from investment operations 3.19 (1.52)
Total increase (decrease) in net asset value 3.19
(1.52)
Net asset value, ending $16.67 $13.48
Total return* 23.66% (10.13%)
Ratios to average net assets:
Net investment income (1.10%) (a) (.98%)(a)
Total expenses+ 2.58% (a) 2.56%(a)
Net expenses 2.50% (a) 2.50%(a)
Expenses reimbursed .56% (a) 3.05%(a)
Portfolio turnover 44% 27%
Net assets, ending (in thousands) $2,796 $975
Number of shares outstanding,
ending (in thousands) 168 72
<PAGE>
Managed Index Portfolio
Financial Highlights
Period Ended
March 31, September 30,
Class C Shares 1999 1998 ##
Net asset value, beginning $13.52 $14.52
Income from investment operations
Net investment income (.04) (.02)
Net realized and unrealized gain (loss) 3.23 (.98)
Total from investment operations 3.19 (1.00)
Total increase (decrease) in net asset value 3.19
(1.00)
Net asset value, ending $16.71 $13.52
Total return* 23.59% (6.89%)
Ratios to average net assets:
Net investment income (1.10%) (a) (.96%)(a)
Total expenses+ 2.57% (a) 2.56%(a)
Net expenses 2.50% (a) 2.50%(a)
Expense reimbursed .45% (a) 2.26%(a)
Portfolio turnover 44% 27%
Net assets, ending (in thousands) $1,227 $397
Number of shares outstanding,
ending (in thousands) 73 29
Period Ended
March 31, September 30,
Class I Shares 1999 1998 ##
Net asset value, beginning $13.54 $15.00
Income from investment operations
Net investment income .05 .04
Net realized and unrealized gain (loss) 3.29 (1.50)
Total from investment operations 3.34 (1.46)
Distributions from
Net investment income (.05) --
Total increase (decrease) in net asset value 3.29
(1.46)
Net asset value, ending $16.83 $13.54
Total return* 24.65% (9.73%)
Ratios to average net assets:
Net investment income .66% (a) .54%(a)
Total expenses+ .81% (a) .81%(a)
Net expenses .75% (a) .75%(a)
Expenses reimbursed .10% (a) .22%(a)
Portfolio turnover 44% 27%
Net assets, ending (in thousands) $18,563 $14,897
Number of shares outstanding,
ending (in thousands) 1,103 1,100
(a) Annualized
* Total return is not annualized for periods less than one year and does
not reflect deduction of any front-end or deferred 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. Total expenses are presented net
of expense waivers and reimbursements.
# From April 1, 1998 inception.
^ From March 1, 1994 inception.
^^ From June 1, 1998 inception.
## From April 15, 1998 inception.
N/A Disclosure not applicable to prior periods.
### From March 1, 1999 inception.
<PAGE>
A special meeting of shareholders was scheduled for February 24, 1999. There
were several proposals voted upon at the meeting. A brief description of
each proposal and the number of votes received for, against, and votes to
abstain is shown below. All proposals were passed.
Proposal 1 for each Portfolio - To approve amended fundamental investment
restrictions to: (a) delete restrictions that are no longer required to be
fundamental due to changes in state laws or which otherwise need not be
fundamental; and (b) to revise the language of those restrictions that are
still required to be fundamental.
CSIF Money Market Portfolio
For Against Abstain Broker Non-Vote
83,314,321 2,109,661 9,208,268 600,000
CSIF Balanced Portfolio
For Against Abstain Broker Non-Vote
7,879,116 314,272 863,148 2,058,498
CSIF Bond Portfolio
For Against Abstain Broker Non-Vote
2,308,150 77,820 202,898 280,444
CSIF Equity Portfolio
For Against Abstain Broker Non-Vote
2,462,053 84,257 345,785 511,500
CSIF Managed Index Portfolio
For Against Abstain Broker Non-Vote
1,345,292 1,923 17,304 129,678
Proposal 2 for each Portfolio - To approve a new investment advisory
agreement with the investment advisor, Calvert Asset Management Company,
Inc. ("CAMCO") (as described in Note B to Financial Statements).
CSIF Money Market Portfolio
For Against Abstain
83,338,470 2,472,754 9,421,026
CSIF Balanced Portfolio
For Against Abstain
10,011,914 268,123 834,997
<PAGE>
CSIF Bond Portfolio
For Against Abstain
2,045,542 70,534 192,074
CSIF Equity Portfolio
For Against Abstain
2,994,469 68,526 340,600
CSIF Managed Index Portfolio
For Against Abstain
1,474,950 1,363 17,884
Proposal 3 for CSIF Balanced - To approve a new investment subadvisory
agreement between CAMCO and the investment subadvisor, NCM Capital
Management Group, Inc.
For Against Abstain
10,004,820 245,092 865,121
Proposal 4 for CSIF Balanced - To approve a new investment subadvisory
agreement between CAMCO and the investment subadvisor, Brown Capital
Management, Inc.
For Against Abstain
10,030,514 230,718 853,800
Proposal 5 for CSIF Equity - To approve a new investment subadvisory
agreement between CAMCO and the investment subadvisor, Atlanta Capital
Management Company, L.L.C.
For Against Abstain
2,995,330 71,396 336,870
Proposal 6 for CSIF Balanced and Equity - To authorize CSIF and/or CAMCO to
enter into a new and/or materially amend an existing investment subadvisory
agreement with a subadvisor in the future without having to first obtain
shareholder approval.
CSIF Balanced Portfolio
For Against Abstain Broker Non-Vote
7,711,297 501,708 843,531 2,058,498
<PAGE>
CSIF Equity Portfolio
For Against Abstain Broker Non-Vote
2,388,668 162,956 335,285 516,686
Proposal 7 for CSIF Balanced - To approve a revised investment objective
which is more reflective of current economic times.
For Against Abstain Broker Non-Vote
8,031,470 254,306 770,761 2,058,497
Proposal 8 for CSIF Bond - To change CSIF Bond from a diversified to a
nondiversified fund.
For Against Abstain Broker Non-Vote
1,710,195 112,084 205,426 280,445
Proposal 9 for each Portfolio - To ratify each Board's selection of
auditors, PricewaterhouseCoopers LLP.
CSIF Money Market Portfolio
For Against Abstain
85,209,799 1,108,923 8,913,527
CSIF Balanced Portfolio
For Against Abstain
10,262,483 107,269 745,282
CSIF Bond Portfolio
For Against Abstain
2,099,927 27,425 180,799
CSIF Equity Portfolio
For Against Abstain
3,058,500 37,607 307,488
CSIF Managed Index Portfolio
For Against Abstain
1,480,563 879 12,755
<PAGE>
Calvert Group and the Year 2000
Plans and Progress
We are now less than a year away from the year 2000, a problematic date for
computer systems coded for two-character year format. Entered as "00," the
year 2000 would be processed as 1900, a mistake that could foul a variety of
date-sensitive transactions.
As your mutual fund sponsor, our goal is make sure there is no interruption
in the level of service you receive. In the summary below, we've outlined
the steps Calvert Group is taking to ensure our systems perform reliably.
Step One-Assess Systems and Software. Develop an Action Plan
In 1997, we identified all systems, operating platforms and software
potentially affected by the millennium bug. These included:
Calvert Group systems-portfolio trading, sales contact and reporting and
internal management reporting
transfer agency systems-shareholder record-keeping and transaction
processing
subadvisor systems--investment accounting
other third-party data and service systems.
We also formed a Y2K task force, led by Calvert's vice president of
technology. This group has identified and prioritized our efforts to achieve
year 2000
compliance.
Step Two-Test for Compliance. Repair Systems as Necessary.
Internal systems have been tested. We've made repairs and moved modified
code into production. These systems are now fully compliant. Transfer agency
systems were re-engineered for compliance in 1989. Recent tests indicate
these are, in fact, compliant. The readiness of third-party systems,
including subadvisor systems, has been evaluated. Based on information
received from these groups, we have found no significant obstacles to
compliance.
Step Three-Confirm Compliance. Finalize Contingency Plan.
Testing of transfer agency systems will continue through 1999 to ensure
these remain compliant and continue to interact correctly with external
systems and processes. The transfer agency has established a back-up site,
should main systems fail, and compliance testing of these contingency
measures are also underway. We are developing contingency plans to ensure
that any unforeseen systems failures will not adversely affect our
operations or inconvenience our shareholders.
For more information or to get an update on remediation and testing efforts,
please visit us online at www.calvertgroup.com.
