<PAGE>
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DEAR SHAREHOLDERS:
We are pleased to provide this report for INA Investment Securities, Inc., cov-
ering the quarter ended March 31, 1995.
BOND RALLY MARKS FIRST QUARTER
Thus far in 1995, the markets major surprise has been an unexpectedly strong
rally in bonds. Slower growth and tame inflation numbers have helped build in-
vestor confidence that the Federal Reserve has indeed engineered a "soft land-
ing" for the economy.
Corporate bonds, including the high-yield sector, continued to perform well. A
significant decline in the number of new bonds issued, coupled with unabated
investor demand, kept spreads over Treasury bonds near historic lows. For the
same supply and demand reasons, most mortgage-backed securities also performed
well. The bond market returned a healthy +4.98% during the first quarter, as
measured by the Lehman Government/Corporate Index.
FUND PERFORMANCE
The Fund's performance compared favorably with the market index for the quar-
ter, returning +4.87% after deduction of expenses and reinvestment of divi-
dends, based on net asset value of underlying Fund assets.
PORTFOLIO REVIEW
The portfolio remains fully invested. On March 31, 1995, corporate and foreign
bonds were approximately 63.0% of portfolio holdings, U.S. government/agency
securities 32.2%, and cash and other assets 4.8%. Per-share net asset value was
$18.08, up from $17.56 on December 31, 1994. A dividend of $.33 was declared
during the first quarter.
OUTLOOK
There is a good chance the economy will accelerate again during late spring or
summer, prompting the Federal Reserve Bank to raise short-term rates and
tighten credit. Until longer term economic trends re-assert themselves, the
markets will most likely go on trading in a narrow range. We do not anticipate
making significant changes in the duration of the bonds in which we invest over
this period. We do expect to continue to favor non-Treasury securities, and to
maintain a presence in the high-yield market.
Sincerely,
\s\ R. Bruce Albro
R. Bruce Albro, Chairman
INA Investment Securities, Inc.
May 4, 1995
<PAGE>
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FINANCIAL SUMMARY
For the Three Months Ended March 31 (Unaudited)
(In Thousands)
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
Net investment income $1,567 $1,577
Net realized and unrealized gain (loss) 2,529 (4,590)
Per share:
Net investment income $ 0.33 $ 0.33
Dividends from net investment income $ 0.33 $ 0.33
Net asset value at end of period $18.08 $18.76
</TABLE>
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NET INVESTMENT INCOME PER SHARE
For the Three Months Ended March 31 (Unaudited)
<TABLE>
- - ------------------------------------------------------------------------------------------------------------
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C>
$0.33 $0.33 $0.36 $0.37 $0.40
</TABLE>
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STATEMENT OF ASSETS AND LIABILITIES
March 31, 1994 (Unaudited)
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(IN THOUSANDS)
--------------
<S> <C>
ASSETS:
Investments at market value
(Cost -- $86,276,085) $85,216
Cash 1
Interest receivable 2,178
Other 41
-------
Total assets 87,436
-------
LIABILITIES:
Payable for investments purchased 531
Deferred directors' fees payable 84
Accrued advisory fees payable 43
Other accrued expenses (including $17,531 due to affiliate) 132
-------
Total liabilities 790
-------
NET ASSETS $86,646
=======
NET ASSET VALUE PER SHARE
Applicable to 4,792,215 shares of $.10 par value capital stock
outstanding (12,000,000 shares authorized) $18.08
======
</TABLE>
<PAGE>
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STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
For the Three Months Ended March 31, 1995
(Unaudited)
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(IN THOUSANDS)
--------------
<S> <C> <C>
INVESTMENT INCOME:
Interest $ 1,782
EXPENSES:
Investment advisory fees $ 112
Administrative services 19
Transfer agent fees 17
Shareholder reports 17
Custodian fees 16
Auditing and legal fees 13
State taxes 9
Directors' fees 8
Other 4 215
----- --------
NET INVESTMENT INCOME 1,567
NET REALIZED GAIN ON INVESTMENTS 46
UNREALIZED APPRECIATION OF INVESTMENTS 2,483
--------
NET INCREASE IN NET ASSETS FROM OPERATIONS 4,096
DISTRIBUTIONS TO SHAREHOLDERS
FROM NET INVESTMENT INCOME (1,581)
--------
NET INCREASE IN NET ASSETS 2,515
NET ASSETS:
Beginning of period 84,131
--------
End of period (includes overdistributed net investment income
of $35,563) $ 86,646
========
</TABLE>
<PAGE>
INA Investment Securities is a closed-end, diversified manage- ment investment
company that invests primarily in debt securities. The investment adviser is
CIGNA Investments, Inc., Hartford, Connecticut 06152.
Shareholders may elect to have dividends automatically reinvested in additional
shares of INA Investment Securities by participating in the Automatic Dividend
Investment Plan. For a brochure describing this Plan or general inquiries about
your account, contact State Street Bank and Trust Company, Stock Transfer De-
partment, P.O. Box 8200, Boston, Massachusetts, 02266-8200, or call toll-free
1-800-426-5523.
<PAGE>
-------------------
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U.S. POSTAGE
INA Investment Securities, Inc. PAID
P.O. Box 13856 SO. HACKENSACK, NJ
Philadelphia, PA 19101 PERMIT 750
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Printed on recycled paper
[LOGO OF CIGNA APPEARS HERE]
INA Investment Securities, Inc.
First Quarter Report
March 31,1995
