<PAGE>
A Message To Our Contract Owners:
We are pleased to forward this combined Annual Report of Massachusetts Mutual
Variable Annuity Fund 1 ("Fund") and the MML Series Investment Fund ("MML
Trust"). These reports are for the year ended December 31, 1995.
The Annual Report for the Fund begins on page 3. The Fund has net assets of
$21,573,260 as of December 31, 1995. Net asset values per accumulation unit for
the Fund are shown in detail in the table on page 3.
The Annual Report for the MML Trust begins on page 9. This report contains a
detailed description of the financial results of the four series of the MML
Trust -- MML Equity Fund, MML Money Market Fund, MML Managed Bond Fund and MML
Blend Fund for the year ended December 31, 1995.
We appreciate the interest and confidence you have shown in the Fund.
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
/s/ Thomas B. Wheeler
Thomas B. Wheeler
President and Chief Executive Officer
February 1, 1996
1
<PAGE>
Table of Contents
Massachusetts Mutual Variable Annuity Fund 1
Statement of Assets and Liabilities as of December 31, 1995... 3
Statement of Operations For The Year Ended December 31, 1995.. 4
Statement of Changes in Net Assets For The Years Ended
December 31, 1995 and 1994................................... 5
Notes to Financial Statements................................. 6-7
Report of Independent Accountants............................. 8
MML Series Investment Fund
To Our Shareholders........................................... 9-11
Statement of Assets and Liabilities as of December 31, 1995... 12
Statement of Operations For The Year Ended December 31, 1995.. 13
Statement of Changes in Net Assets For The Years Ended
December 31, 1995 and 1994................................... 14
Financial Highlights.......................................... 15-16
Schedule of Investments as of December 31, 1995
MML Equity Fund............................................. 17-19
MML Money Market Fund....................................... 20
MML Managed Bond Fund....................................... 21-23
MML Blend Fund.............................................. 24-28
Notes to Financial Statements................................. 29-31
Report of Independent Accountants............................. 32
2
<PAGE>
Massachusetts Mutual Variable Annuity Fund 1
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1995
<TABLE>
<S> <C>
ASSETS
Investment in MML Equity Fund 806,939 shares at value
(Identified cost $13,674,156) (Notes 3A and 3B).......... $20,919,002
Dividends receivable...................................... 793,651
Other assets.............................................. 8,696
-----------
Total assets............................................ 21,721,349
-----------
LIABILITIES
Annuitant mortality fluctuation reserve (Note 3D)......... 30,730
Payable to Massachusetts Mutual Life Insurance Company.... 117,359
-----------
Total liabilities....................................... 148,089
-----------
NET ASSETS................................................ $21,573,260
===========
Net Assets consist of:
1,451,842 accumulation units at $14.15 per unit (Note 8).. $20,548,916
Annuity reserves (Note 3E)................................ 1,024,344
-----------
Net assets.............................................. $21,573,260
===========
Net asset value per accumulation unit
December 31, 1995....................................... $ 14.15
December 31, 1994....................................... 10.87
December 31, 1993....................................... 10.52
December 31, 1992....................................... 9.67
December 31, 1991....................................... 8.81
</TABLE>
See Notes to Financial Statements.
3
<PAGE>
Massachusetts Mutual Variable Annuity Fund 1
STATEMENT OF OPERATIONS
For The Year Ended December 31, 1995
<TABLE>
<S> <C>
Investment income
Dividends (Note 3B)......................................... $ 794,389
Expenses
Mortality and expense risk fees (Note 4).................... 150,874
----------
Net investment income (Note 3C)............................. 643,515
----------
Net realized and unrealized gain on investments
Net realized gain on investments (Notes 3B, 3C and 6)....... 1,216,677
Change in net unrealized appreciation on investments........ 3,590,464
----------
Net gain on investments..................................... 4,807,141
----------
Net increase in net assets resulting from operations........ $5,450,656
==========
</TABLE>
See Notes to Financial Statements.
4
<PAGE>
Massachusetts Mutual Variable Annuity Fund 1
STATEMENT OF CHANGES IN NET ASSETS
For The Years Ended December 31, 1995 and 1994
<TABLE>
<CAPTION>
1995 1994
----------- -----------
<S> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income.............................................. $ 643,515 $ 597,195
Net realized gain on investments................................... 1,216,677 729,445
Change in net unrealized appreciation/depreciation on investments.. 3,590,464 (686,930)
----------- -----------
Net increase in net assets resulting from operations............... 5,450,656 639,710
----------- -----------
Capital transactions: (Note 8)
Net contract payments (Note 5)..................................... 92,252 77,970
Reimbursement (payment) of accumulation unit value fluctuation..... (23,441) 4,494
Net credit to annuitant mortality fluctuation reserve (Note 3D).... (192,215) (113,451)
Expense guarantee adjustment (Note 7).............................. 2,125 2,470
Withdrawal of funds................................................ (2,604,279) (1,402,471)
Annuity benefits................................................... (144,557) (156,091)
----------- -----------
Net decrease in net assets resulting from capital transactions..... (2,870,115) (1,587,079)
----------- -----------
Total increase (decrease).......................................... 2,580,541 (947,369)
NET ASSETS, at beginning of the year................................ 18,992,719 19,940,088
----------- -----------
NET ASSETS, at end of the year...................................... $21,573,260 $18,992,719
=========== ===========
</TABLE>
See Notes to Financial Statements.
5
<PAGE>
Massachusetts Mutual Variable Annuity Fund 1
Notes To Financial Statements
1. HISTORY
Massachusetts Mutual Variable Annuity Fund 1 ("Fund") is a separate
investment account established by Massachusetts Mutual Life Insurance
Company ("MassMutual"). The Fund operates as a registered unit investment
trust pursuant to the Investment Company Act of 1940 and the rules
promulgated thereunder.
2. INVESTMENT OF THE FUND'S ASSETS
The Fund invests in shares of MML Equity Fund. MML Equity Fund is one of the
four series of shares of MML Series Investment Fund (the "MML Trust"). The
MML Trust is a no-load, registered, open-end, diversified management
investment company for which MassMutual acts as investment manager. Concert
Capital Management, Inc. ("Concert Capital"), a wholly-owned subsidiary of
DLB Acquisition Corporation, which is a controlled subsidiary of MassMutual,
serves as investment sub-advisor to the MML Equity Fund.
3. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
consistently by the Fund in the preparation of the financial statements in
conformity with generally accepted accounting principles.
A. Investment Valuation
The investment in MML Equity Fund is stated at market value which is the net
asset value of MML Equity Fund.
B. Accounting For Investments
Investment transactions are accounted for on trade date and identified cost
is the basis followed in determining the cost of investments sold for
financial statement purposes. Dividend income is recorded on the ex-dividend
date.
C. Federal Income Taxes
Operations of the Fund form a part of the total operations of MassMutual,
and the Fund is not taxed separately. MassMutual is taxed as a life
insurance company under the provisions of the 1986 Internal Revenue Code, as
amended. The Fund will not be taxed as a "regulated investment company"
under Subchapter M of the Internal Revenue Code. Under existing federal law,
no taxes are payable on investment income and realized capital gains
attributable to contracts which depend on the Fund's investment performance
(the "Contracts"). Accordingly, no provision for federal income tax has
been made. MassMutual may, however, make such a charge in the future if an
unanticipated change of current law results in a company tax liability
attributable to the Fund.
D. Annuitant Mortality Fluctuation Reserve
The Fund maintains a reserve as required by regulatory authorities to
provide for mortality losses incurred. The reserve is increased quarterly
for mortality gains and its proportionate share of any increases in value.
The reserve is charged quarterly for mortality losses and its proportionate
share of any decreases in value. Transfers to or from MassMutual are then
made quarterly to adjust the Fund. Net transfers from the Fund to MassMutual
totaled $193,494 and $119,954 for the years ended December 31, 1995 and
1994, respectively. The reserve is subject to a maximum of 3% of the Fund's
annuity reserves. Any mortality losses in excess of this reserve will be
assumed by MassMutual. The reserve is not available to owners of Contracts
except to the extent necessary to cover mortality losses under the
Contracts.
E. Annuity Reserves
Annuity reserves are developed by using accepted actuarial methods and are
computed using the Annuity Table for 1949, as modified.
F. Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
6
<PAGE>
Notes To Financial Statements (Continued)
4. Charges
Daily charges for mortality and expense risks assumed by MassMutual are made
which are equivalent on an annual basis to 0.730% of the value of the
Contracts. Effective on January 1 of any year after the first Contract year,
the daily charge made for the assumption of mortality and expense risks will
be as determined by MassMutual, but in no event will such charge be at an
annual rate of more than 1.2045% of the value of the Contracts.
5. Net Contract Payments
<TABLE>
<CAPTION>
For the Years Ended
December 31,
--------------------------
1995 1994
---------- ----------
<S> <C> <C>
Gross contract payments.................................. $ 100,373 $ 84,865
Less sales and administrative charges and premium taxes.. 8,121 6,895
---------- ----------
Net contract payments.................................... $ 92,252 $ 77,970
========== ==========
</TABLE>
No deduction is made for sales expense with respect to purchase payments
derived from proceeds under fixed-dollar life insurance or fixed-dollar
annuity contracts issued by MassMutual.
6. Purchases and Sales of Investments
The aggregate cost of MML Equity Fund shares acquired for the year ended
December 31, 1995 was $916,634. The proceeds from sales of MML Equity Fund
shares for the year ended December 31, 1995 were $3,068,837.
7. Expense Guarantee Adjustment
MassMutual will reimburse the Fund for any per share expenses of MML Equity
Fund attributable to shares of MML Equity Fund held by the Fund other than
(1) the annual investment management fee payable to MassMutual by MML Equity
Fund, (2) brokerage commissions and other capital items payable in
connection with the purchase or sale of MML Equity Fund's investments and
(3) interest on account of any borrowings by MML Equity Fund. No such
reimbursements were required for the year ended December 31, 1995 and 1994.
8. Net Decrease in Accumulation Units
<TABLE>
<CAPTION>
For the Years Ended
December 31,
-----------------------------
1995 1994
---------- ----------
<S> <C> <C>
Units purchased................................... 7,578 7,309
Units withdrawn................................... (205,108) (131,000)
Units transferred to annuity reserves............. -- (1,160)
---------- ----------
Net decrease...................................... (197,530) (124,851)
Units, at beginning of the year................... 1,649,372 1,774,223
---------- ----------
Units, at end of the year......................... 1,451,842 1,649,372
========== ==========
</TABLE>
Offered through MML Investors Services, Inc., Springfield, Massachusetts.
7
<PAGE>
Report Of Independent Accountants
To the Contract Owners of Massachusetts Mutual Variable Annuity Fund 1
and the Board of Directors of Massachusetts Mutual Life Insurance Company
We have audited the statement of assets and liabilities of Massachusetts Mutual
Variable Annuity Fund 1 as of December 31, 1995, and the related statement of
operations for the year then ended, and the statement of changes in net assets
for each of the two years in the period then ended. These financial statements
are the responsibility of the Account's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
verification of investments owned as of December 31, 1995 by examination of the
records of MML Series Investment Fund. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Massachusetts Mutual Variable
Annuity Fund 1 at December 31, 1995, the results of their operations for the
year then ended, and the changes in their net assets for each of the two years
in the period then ended, in conformity with generally accepted accounting
principles.
Coopers & Lybrand L.L.P.
Springfield, Massachusetts
February 6, 1996
8
<PAGE>
MML SERIES INVESTMENT FUND
TABLE OF CONTENTS
Page
----
To Our Shareholders..................................................... 2 - 4
Statement of Assets and Liabilities as of December 31, 1995............. 5
MML Equity Fund
MML Money Market Fund
MML Managed Bond Fund
MML Blend Fund
Statement of Operations for the year ended December 31, 1995............ 6
MML Equity Fund
MML Money Market Fund
MML Managed Bond Fund
MML Blend Fund
Statement of Changes in Net Assets for the year ended December 31, 1995
and 1994............................................................... 7
MML Equity Fund
MML Money Market Fund
MML Managed Bond Fund
MML Blend Fund
Financial Highlights
MML Equity Fund.................................................... 8
MML Money Market Fund.............................................. 8
MML Managed Bond Fund.............................................. 9
MML Blend Fund..................................................... 9
Schedule of Investments as of December 31, 1995
MML Equity Fund.................................................... 10 - 12
MML Money Market Fund.............................................. 13
MML Managed Bond Fund.............................................. 14 - 16
MML Blend Fund..................................................... 17 - 21
Notes to Financial Statements........................................... 22 - 24
Report of Independent Accountants....................................... 25
1
<PAGE>
MML Series Investment Fund
To Our Shareholders
An Economic Soft Landing Is Achieved in U.S.
The past year saw the continuation of a very good economic environment for
investors in both stocks and bonds. The U.S. economic growth rate as measured by
Gross Domestic Product continued to slow throughout the year from its heated
level of 4.1% in 1994 to roughly 2.5% in 1995. The Federal Reserve, which had
been raising rates during 1994 in an attempt to slow growth somewhat, was able
to change course and even move rates lower. Because the economy is cyclical, the
Fed wanted growth to slow to a more moderate, sustainable level - a "soft
landing" from 1994's rapid pace - to prolong the positive part of the current
cycle.
As demand for goods slowed from 1994 levels, businesses began reducing their
inventories, which had started the year at high levels. This in turn slowed
order- and production-driven demand from the manufacturing sector, which exerted
further downward pressure on the growth rate, supported the cause for interest
rate cuts, and helped keep inflation at bay.
Stock and Bond Markets React
While the Federal Reserve actually increased rates as late as February 1995, the
bond market had begun to rally as early as November 1994 on the belief that
growth would slow enough to indicate a change in monetary policy. The market was
correct. The Fed's February rate increase of 1/2 point was followed during the
year by two cuts of 1/4 point each in July and December. Rates on Treasuries
fell significantly during this period, which drove dramatic price appreciation
for Treasuries. The prices in most other bond sectors followed suit, with 1995
playing out to be one of the strongest bull markets for bonds in history.
Backed by low interest rates and a strong bond market, stocks reached all-time
highs in 1995. The Dow Jones Industrial Average made new highs almost daily,
hitting a peak of 5216 and closing the year at 5117, and the S&P 500 rose
37.58%. In addition to support from the bond market, stocks reacted to continued
positive earnings surprises, merger and consolidation activity, an improving
export picture and growing productivity and efficiency throughout corporate
America.
Outlook for Economy, Markets Remains Positive
The forecast for the economy and markets appears favorable, though both should
be somewhat more moderate than they were during the past year. Economic growth
will probably slow further because employment and personal income - which are
important components of demand - are not strong enough to fuel increases in
demand-driven growth.
Even in the face of a slower economy, sales and earnings remained strong through
the end of 1995. The U.S. had its biggest productivity gain on record in 1995
and exports grew, aided in the early part of the year by a weak dollar, which in
turn created improvements in trade. Going into 1996, we expect to see exports
remain strong, as U.S. businesses recognize that future growth will come in part
from operating in a global market. This opinion is supported by the heavy
outlays we've seen for business equipment, which should further enhance
competitiveness, productivity and export activity for the coming year.
The Case for Value Investing
Because of uncertainty about the slowing in the economy throughout 1995, growth
investing, or buying stocks of companies whose earnings growth rates can surpass
that of the economy, took the lead last year. By the same token it was growth,
rather than income, that led to the dramatic appreciation of 1995's bond market.
With both markets currently at high levels in terms of price, we believe we will
see a return of superior performance from value investing strategies. Value
investing relies on capturing appreciation by "buying well" and seeking out
fundamental values, rather than buying above-average growth. Value investors
like the MML Series Investment Fund work to buy stocks and bonds that are either
temporarily out-of-favor with the markets, or that offer opportunities that have
not yet been recognized by the investment community at large.
With stocks and bonds at highs and an economy that is likely to continue to
slow, we expect both the stocks and bond markets to return to more "normal"
activity in terms of returns and volatility. In this type of environment, value
investing should continue to offer solid long-term results. Since security
selection should be very important in the coming year, your portfolio managers
will continue to rely upon hands-on research and careful analysis in an effort
to find the best opportunities for investors.
/s/ Stuart H. Reese
Stuart H. Reese
President
MML Series Investment Fund
January 31, 1996
2
<PAGE>
MML EQUITY
How has the Fund performed over the period?
The Fund has performed very well, with 1995 returns at nearly three times the
long-term average for stocks. Typically, our value-oriented style has not
outperformed the broad market indices in years where absolute gains have been as
robust as in 1995. Over the long term, however, our value strategy - focusing on
dividend-paying companies with strong balance sheets while their stocks are
selling at what we consider low prices - has been very successful.
How did large company stocks perform in 1995?
Large company stocks were the place to be this year. Benefiting from improved
productivity, falling interest rates and, through August, a weak dollar, large
companies were able to turn in earnings at levels more typical of small company
growth stocks, which drove their prices up. The market's focus on large cap
stocks benefited the Fund.
What strategic moves have you made within the portfolio?
Though we make investments based on researching individual companies rather than
their industry sectors, the biggest move we made over the period was increasing
our exposure to consumer non-durables companies, one of the best performing
sectors for the year. Our purchases in Albertson's, a major grocery concern and
several consumer goods companies such as American Brands and Kimberly-Clark,
benefited the portfolio considerably. These businesses typically are insulated
from slowing economic growth. We also increased our holdings in the very strong
financial services area, buying the stock of MBIA, a municipal bond insurer and
Safeco, a large property and casualty insurance firm. Our higher exposure to
financial services was another plus for the Fund - in fact, looking back, we
would have liked to have owned more. Over the year, the size of the Fund has
grown, and so has the weighted average market capitalization. This was a third
benefit during a period of large cap leadership.
What segments of the market are you currently targeting?
Our buying has shifted from consumer non-durables to more cyclical companies.
Because this area suffered price declines over the year as the market favored
sectors with more stable earnings, we've been able to buy stocks at what we
consider compelling values. We are buying and looking to buy companies that can
benefit from lower basic materials costs and thus improve their profit margins
regardless of the slower economy.
What is your outlook for the Fund?
After the past year, it's become more difficult to find reasonably-priced
stocks, but with inflation and long-term interest rates low, our outlook remains
favorable. We believe the coming year's market will be positive, but that it
will perform more like its historical average than it did in 1995. We expect to
see more typical levels of volatility than last year's market. During the past
year, the broad market advanced significantly. Going forward, we believe stock
selection will again become more important. That could benefit the Fund in that
strong stock selection is one of the major advantages of a research-driven value
strategy like ours.
MML MONEY MARKET
How has the Fund performed over the period?
The Fund has performed well, remaining on target with its goal of providing
principal preservation and a competitive level of current income by investing in
highly liquid short-term debt instruments. While longer-term interest rates
continued to decline over the majority of the year, rates for the extremely
short-term securities we focus on remained favorable, and even exceeded rates on
longer-term issues at certain times during the year.
What strategic moves have you made within the portfolio?
Over the course of the year, we made one major change. Both in the early part of
1995 when it was anticipated and then later when it actually happened, we
lengthened the average maturity of the Fund's portfolio on the likelihood of the
Federal Reserve's interest rate cuts. By lengthening our maturity, we hoped to
make use of available higher current income levels for as long as possible,
expecting that debt issued after a rate cut would offer lower income levels.
This strategy benefited the Fund by allowing us to maintain our income stream
while the market adjusted to the Fed's actions.
What is your outlook for the Fund?
The Fed eased, or lowered rates, twice in 1995 and may do so again in the first
few months of 1996 depending on the forecast for the economy. If it appears that
the economy has slowed too far, or if budget discussions are finalized, another
decline is a distinct possibility. However, we believe that any further declines
will not be significant. In this environment, we are continuing to extend
maturities in an effort to make the most of the current rates while maintaining
an emphasis on principal stability. Our outlook for the Fund remains optimistic,
though our performance as always will be tied to any changes in the Federal
Reserve's monetary policy.
3
<PAGE>
MML MANAGED BOND
How has the Fund performed over the period?
The Fund's performance has been excellent. It compares favorably to its market
indices and has been outstanding on an absolute and historical basis. The past
year has been an extremely strong period for the bond market in general, with
bonds from almost every sector the Fund invests in benefiting from decreasing
interest rates and the price appreciation that accompanies rate declines.
What strategic decisions have you made within the portfolio as a result of lower
rates?
In response to declines in interest rates, our duration increased somewhat over
the period. A longer duration will help us take advantage of any potential
benefits from further changes in the rate structure. New supply in the market
tended to be longer, particularly in corporate bonds. This was due in part to
lower rates. So increasing our duration has allowed us to continue to track the
duration of the Lehman Government/Corporate Index, which is our benchmark. The
portfolio's average duration increased over the period from 4.85 years to 5.23
years.
What other strategic moves have you made within the portfolio?
During the year, the Fund grew from $121 million to $159 million in size. While
this was due in part to asset appreciation and in part to new investments, it
required a great deal of trading activity to become fully invested. Over the
period we initially increased our holdings of Treasuries, and then we sold some
of our Treasuries as the market improved. Corporates also performed well over
the period due to strong fundamentals and demand factors. Additionally, we
increased our holdings of mortgage-backed securities. Though mortgages are
typically sensitive to prepayment risk, our well-seasoned, well-structured
holdings remained strong throughout the period's declines in rates.
What areas of the market are you currently targeting?
As we believe the corporate market still offers strong potential, though within
a slowing economy, we're employing extensive credit research before investing in
corporate issues. We also continue to increase our exposure to the mortgage-
backed sector of the market, especially in adjustable rate mortgages, where
we're finding particularly attractive pricing. Pricing remains an important part
of our investment strategy. We continue to buy bonds across sectors wherever we
believe we've found appreciation potential through mispriced issues.
What is your outlook for the Fund?
This has been a dramatic year for the bond market and the Fund. While current
low inflation and slow to moderate economic growth lead us to believe there is
still room for appreciation in the market, it would be very difficult to imagine
repeating 1995's performance. Our outlook is for the extension of a positive
market environment, where income will again be an important component of total
return. Within this outlook, we expect the Fund to continue to provide high
total return potential consistent with reasonable risk by maintaining a
diversified portfolio of high quality bonds.
MML BLEND
How has the Fund performed over the period?
The Fund has performed quite well, backed by the dramatic appreciation declining
interest rates sparked in both the stock and bond markets. Because of the Fund's
focus on preservation of capital, however, it did not perform as well as some of
its more aggressive peers over this unusual time period. Though it will tend to
lag in strong bull markets, we believe our strategy is prudent for long-term
investors and that it will outperform over time.
Did your allocation between stocks, bonds and cash change over the period?
Our stock holdings will normally fall within a range of 50% to 70% of the
portfolio. In the beginning of the year, we were 53% invested in stocks and by
the end of year, they represented approximately 54%. Our core bond holdings at
the end of 1995 represented 15% of the portfolio, down from 19%. In bonds, a
flattening yield curve also indicated a shortening in the average life of our
portfolio. When the yield curve is flatter, investors are typically not
well-compensated for extending into longer-maturity bonds. While this excluded
us from some of the appreciation in the bond market, our bond portfolio
performed well. Our allocation decisions stem from a policy consistent with
preservation of capital. The remainder of the portfolio, approximately 31% up
from 28% a year ago, is invested in short-term securities.
What is your outlook for the Fund?
An environment of low inflation, favorable interest rates and slow to moderate
economic growth suggests the continuation of decent markets for both stocks and
bonds. While results should remain positive, we expect to see a return to more
normal periods for both markets. In stocks, we are positioning the Fund for
greater volatility and selectivity in the coming year and in bonds, we expect
income to again become the most consistent component of total return. We believe
the MML Blend Fund's conservative strategy should position it to perform well
during this more typical market environment.
4
<PAGE>
MML Series Investment Fund
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1995
<TABLE>
<CAPTION>
MML MML
MML Money Managed MML
Equity Market Bond Blend
Fund Fund Fund Fund
------ ------ ------ -------
<S> <C> <C> <C> <C>
ASSETS
Investments at value (See Schedule of Investments)
(Notes 2A, 2B and 5)
Equities (Identified cost: $784,795,485;
$627,696,809 respectively)............................... $1,155,154,333 $ -- $ -- $1,008,564,451
Bonds and notes (Identified cost: $145,473,365;
$267,817,760 respectively)............................... -- -- 151,903,257 279,948,878
Short-term investments (Identified cost: $146,006,980;
$109,543,253; $2,578,380; $582,413,954 respectively)..... 146,000,856 109,543,253 2,578,380 582,150,249
-------------- ------------ ------------ --------------
Total investments........................................ 1,301,155,189 109,543,253 154,481,637 1,870,663,578
Cash......................................................... 8,396 2,440 5,639,136 13,407,050
Interest and dividends receivable............................ 2,502,360 497 2,067,198 6,632,527
Receivable for investments sold.............................. 910,994 -- 7,093,878 1,355,885
Receivable for settlement of investments
purchased on a forward commitment basis (Note 2D).......... -- -- -- 1,388,372
Prepaid trustees' fees....................................... 820 522 522 390
-------------- ------------ ------------ --------------
Total assets............................................. 1,304,577,759 109,546,712 169,282,371 1,893,447,802
-------------- ------------ ------------ --------------
LIABILITIES
Payable for investments purchased............................ 7,019,418 -- 7,923,222 14,568,979
Dividends payable (Note 2C).................................. 47,382,259 475,700 2,456,289 53,960,727
Investment management fee payable (Note 4)................... 1,197,689 135,475 187,550 1,722,486
Accrued liabilities.......................................... 79,387 15,336 17,172 54,680
-------------- ------------ ------------ --------------
Total liabilities........................................ 55,678,753 626,511 10,584,233 70,306,872
-------------- ------------ ------------ --------------
NET ASSETS................................................... $1,248,899,006 $108,920,201 $158,698,138 $1,823,140,930
============== ============ ============ ==============
Net assets consist of:
Series shares (par value $.01 per share; an unlimited
number authorized) (Note 6)................................ $ 481,756 $ 1,089,202 $ 127,487 $ 888,515
Additional paid-in capital................................... 878,072,599 107,830,999 152,990,211 1,428,825,164
Undistributed (overdistributed) net investment
income (Note 2C)........................................... 3,739 9,734 (72,567) (7,094)
Undistributed net realized loss on investments and
forward commitments (Notes 2D and 3)....................... -- (9,734) (776,885) --
Overdistributed net realized gain on investments and
forward commitments (Notes 2C and 2D)...................... (11,812) -- -- (689,082)
Net unrealized appreciation on:
Investments (Note 2A)...................................... 370,352,724 -- 6,429,892 392,735,055
Forward commitments (Note 2D).............................. -- -- -- 1,388,372
-------------- ------------ ------------ --------------
NET ASSETS................................................... $1,248,899,006 $108,920,201 $158,698,138 $1,823,140,930
============== ============ ============ ==============
Outstanding series shares.................................... 48,175,574 108,920,201 12,748,690 88,851,472
============== ============ ============ ==============
Net asset value per share.................................... $25.92 $1.00 $12.45 $20.52
============== ============ ============ ==============
</TABLE>
See Notes to Financial Statements.
5
<PAGE>
MML Series Investment Fund
STATEMENT OF OPERATIONS
For The Year Ended December 31, 1995
<TABLE>
<CAPTION>
MML MML
MML Money Managed MML
Equity Market Bond Blend
Fund Fund Fund Fund
------ ------ ------ ------
<S> <C> <C> <C> <C>
Investment income (Note 2B)
Dividends.................................................... $ 28,229,106 $ -- $ -- $ 26,802,102
Interest..................................................... 6,641,154 5,999,684 10,026,269 49,931,175
------------ ---------- ----------- -----------
Total income............................................. 34,870,260 5,999,684 10,026,269 76,733,277
------------ ---------- ----------- -----------
Expenses
Investment management fee (Note 4)........................... 4,178,204 501,924 681,807 6,344,373
Trustees' fees............................................... 14,625 11,617 11,651 11,900
Audit fees................................................... 27,433 18,917 24,467 29,567
Tax expense.................................................. 6,263 -- -- 6,263
Registration fee............................................. 65,689 5,908 7,745 46,532
Other........................................................ 1,892 1,178 1,178 1,180
------------ ---------- ----------- -----------
Total expenses........................................... 4,294,106 539,544 726,848 6,439,815
------------ ---------- ----------- -----------
Net investment income (Note 2C).............................. 30,576,154 5,460,140 9,299,421 70,293,462
------------ ---------- ----------- -----------
Net realized and unrealized gain (loss) on investments
and forward commitments (Notes 2A, 2B and 2D)
Net realized gain (loss) on:
Investments (Notes 2B and 2C).............................. 16,898,835 (841) 866,079 29,289,639
Forward commitments (Note 2D).............................. -- -- 453,016 6,506,024
------------ ---------- ----------- -----------
Net realized gain (loss)................................. 16,898,835 (841) 1,319,095 35,795,663
------------ ---------- ----------- -----------
Change in net unrealized appreciation/depreciation on:
Investments (Note 2A)...................................... 237,559,436 -- 13,542,298 241,023,762
Forward commitments (Note 2D).............................. -- -- 162,634 2,579,828
Total change in net unrealized appreciation/ ------------ ---------- ----------- -----------
depreciation........................................... 237,559,436 -- 13,704,932 243,603,590
------------ ---------- ----------- -----------
Net gain (loss).............................................. 254,458,271 (841) 15,024,027 279,399,253
------------ ---------- ----------- -----------
Net increase in net assets resulting from operations......... $285,034,425 $5,459,299 $24,323,448 $349,692,715
============ ========== =========== ============
</TABLE>
See Notes to Financial Statements.
6
<PAGE>
MML Series Investment Fund
STATEMENT OF CHANGES IN NET ASSETS
For The Years Ended December 31, 1995 and 1994
<TABLE>
<CAPTION>
1995
-------------------------------------------------------------------
MML MML
MML Money Managed MML
Equity Market Bond Blend
Fund Fund Fund Fund
------ ------ ------ ------
<S> <C> <C> <C> <C>
Increase (decrease)
in net assets
Operations:
Net investment income............... $ 30,576,154 $ 5,460,140 $ 9,299,421 $ 70,293,462
Net realized gain (loss)
on investments and
forward commitments............... 16,898,835 (841) 1,319,095 35,795,663
Change in net unrealized
appreciation/depreciation
on investments and forward
commitments....................... 237,559,436 -- 13,704,932 243,603,590
-------------- ------------ ------------ --------------
Net increase (decrease) in
net assets resulting from
operations........................ 285,034,425 5,459,299 24,323,448 349,692,715
Dividends to shareholders
from: (Note 2C)
Distribution of net investment
income.......................... (30,563,214) (5,459,299) (9,294,583) (70,291,011)
Distribution of net
realized gains.................. (16,854,045) -- -- (35,463,987)
Distribution in excess of net
realized gains.................. -- -- -- --
Net increase in capital share
transactions (Note 6)............ 190,498,822 17,134,168 22,459,621 134,942,076
-------------- ------------ ------------ --------------
Total increase (decrease)........ 428,115,988 17,134,168 37,488,486 378,879,793
NET ASSETS, at beginning
of the year....................... 820,783,018 91,786,033 121,209,652 1,444,261,137
-------------- ------------ ------------ --------------
NET ASSETS, at end
of the year....................... $1,248,899,006 $108,920,201 $158,698,138 $1,823,140,930
============== ============ ============ ==============
(Overdistributed) undistributed
net investment income included
in net assets at end
of the year....................... $ 3,739 $ 9,734 $ (72,567) $ (7,094)
============== ============ ============ ==============
Rate per share of dividends
to shareholders from:
Net investment income............. $.634 $.054 $.782 $ .811
Net realized gains................ .350 -- -- .399
<CAPTION>
1994
----------------------------------------------------------------
MML MML
MML Money Managed MML
Equity Market Bond Blend
Fund Fund Fund Fund
------ ------ ------ ------
<S>................................. <C> <C> <C> <C>
Increase (decrease)
in net assets
Operations:
Net investment income............... $ 23,743,493 $ 3,147,135 $ 8,506,956 $ 56,319,900
Net realized gain (loss)
on investments and
forward commitments............... 9,479,860 (5,364) (2,156,483) 28,803,202
Change in net unrealized
appreciation/depreciation
on investments and forward
commitments....................... (1,773,621) -- (11,386,882) (49,350,511)
------------ ----------- ----------- --------------
Net increase (decrease) in
net assets resulting from
operations........................ 31,449,732 3,141,771 (5,036,409) 35,772,591
Dividends to shareholders
from: (Note 2C)
Distribution of net investment
income.......................... (23,735,788) (3,141,771) (8,503,670) (56,320,396)
Distribution of net
realized gains.................. (9,536,463) -- -- (29,300,874)
Distribution in excess of net
realized gains.................. -- -- -- (254,531)
Net increase in capital share
transactions (Note 6)............ 159,512,479 18,127,025 5,640,533 197,821,191
------------ ----------- ------------ --------------
Total increase (decrease)........ 157,689,960 18,127,025 (7,899,546) 147,717,981
NET ASSETS, at beginning
of the year....................... 663,093,058 73,659,008 129,109,198 1,296,543,156
------------ ----------- ------------ --------------
NET ASSETS, at end
of the year....................... $820,783,018 $91,786,033 $121,209,652 $1,444,261,137
============ =========== ============ ==============
(Overdistributed) undistributed
net investment income
included in net assets at
end of the year................... $ (9,200) $ 8,893 $ (3,270) $ 2,008
============ =========== ============ ==============
Rate per share of dividends
to shareholders from:
Net investment income............. $ .594 $ .038 $ .792 $ .707
Net realized gains................ .238 -- -- .362
</TABLE>
See Notes to Financial Statements
7
<PAGE>
MML Series Investment Fund
FINANCIAL HIGHLIGHTS
Selected per share data for each series share outstanding throughout each year
ended ended December 31:
MML EQUITY FUND
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year........... $ 20.520 $20.510 $19.862 $18.735 $15.659
--------- ------- ------- ------- -------
Income from investment
operations:
Net investment income......... .634 .594 .524 .543 .563
Net realized and unrealized
gain (loss) on investments.. 5.754 .248 1.365 1.420 3.440
--------- ------- ------- ------- -------
Total from investment
operations................... 6.388 .842 1.889 1.963 4.003
--------- ------- ------- ------- -------
Less distributions:
Dividends from net
investment income............ (.634) (.594) (.524) (.543) (.562)
Distribution from net
realized gains............... (.350) (.238) (.717) (.288) (.365)
Distribution in excess of
net realized gains........... -- -- -- (.005) --
--------- ------- ------- ------- -------
Total distributions........... (.984) (.832) (1.241) (.836) (.927)
--------- ------- ------- ------- -------
Net asset value:
End of year................. $ 25.924 $20.520 $20.510 $19.862 $18.735
========= ======= ======= ======= =======
Total return.................. 31.13% 4.10% 9.52% 10.48% 25.56%
Net assets (in millions):
End of year................. $1,248.90 $820.78 $663.09 $490.62 $355.04
Ratio of expenses to
average net assets........... .41% .43% .44% .46% .48%
Ratio of net investment
income to average net
assets....................... 2.89% 3.04% 3.23% 3.09% 3.43%
Portfolio turnover rate....... 11.72% 9.99% 11.28% 9.07% 9.37%
<CAPTION>
1990 1989 1988 1987 1986
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year........... $16.764 $14.929 $13.828 $15.591 $13.832
------- ------- ------- ------- -------
Income from investment
operations:
Net investment income......... .636 .694 .646 .525 .495
Net realized and unrealized
gain (loss) on investments.. (.722) 2.746 1.660 (.066) 2.174
------- ------- ------- ------- -------
Total from investment
operations................... (.086) 3.440 2.306 .459 2.669
------- ------- ------- ------- -------
Less distributions:
Dividends from net
investment income............ (.665) (.711) (.639) (.988) (.412)
Distribution from net
realized gains............... (.354) (.894) (.566) (1.234) (.498)
Distribution in excess of
net realized gains........... -- -- -- -- --
------- ------- ------- ------- -------
Total distributions........... (1.019) (1.605) (1.205) (2.222) (.910)
------- ------- ------- ------- -------
Net asset value:
End of year................. $15.659 $16.764 $14.929 $13.828 $15.591
======= ======= ======= ======= =======
Total return.................. (.51%) 23.04% 16.68% 2.10% 20.15%
Net assets (in millions):
End of year................. $235.45 $226.41 $172.80 $150.41 $141.46
Ratio of expenses to
average net assets.......... .49% .50% .50% .51% .52%
Ratio of net investment
income to average net
assets....................... 4.09% 4.30% 4.05% 3.44% 3.54%
Portfolio turnover rate....... 13.50% 15.71% 15.97% 15.73% 14.73%
</TABLE>
MML MONEY MARKET FUND
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year........... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
--------- ------- ------- ------- -------
Income from investment
operations:
Net investment income......... .054 .038 .027 .034 .059
--------- ------- ------- ------- -------
Total from investment
operations................... .054 .038 .027 .034 .059
--------- ------- ------- ------- -------
Less distributions:
Dividends from net
investment income............ (.054) (.038) (.027) (.034) (.059)
--------- ------- ------- ------- -------
Total distributions........... (.054) (.038) (.027) (.034) (.059)
--------- ------- ------- ------- -------
Net asset value:
End of year................. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
========= ======= ======= ======= =======
Total return.................. 5.58% 3.84% 2.75% 3.48% 6.01%
Net assets (in millions):
End of year................. $ 108.92 $ 91.79 $ 73.66 $ 84.56 $ 94.41
Ratio of expenses to
average net
assets...................... .54% .55% .54% .53% .52%
Ratio of net investment
income to average net
assets....................... 5.43% 3.81% 2.71% 3.42% 5.91%
<CAPTION>
1990 1989 1988 1987 1986
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year........... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------- ------- ------- ------- -------
Income from investment
operations:
Net investment income......... .078 .088 .072 .063 .064
------- ------- ------- ------- -------
Total from investment
operations................... .078 .088 .072 .063 .064
------- ------- ------- ------- -------
Less distributions:
Dividends from net
investment income............ (.078) (.088) (.072) (.063) (.064)
------- ------- ------- ------- -------
Total distributions........... (.078) (.088) (.072) (.063) (.064)
------- ------- ------- ------- -------
Net asset value:
End of year................. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======= ======= ======= ======= =======
Total return.................. 8.12% 9.16% 7.39% 6.49% 6.60%
Net assets (in millions):
End of year................. $114.59 $ 70.16 $ 66.35 $ 52.35 $ 33.54
Ratio of expenses to
average net assets........... .54% .54% .55% .57% .57%
Ratio of net investment
income to average net
assets....................... 7.80% 8.79% 7.20% 6.35% 6.44%
</TABLE>
See Notes to Financial Statements
8
<PAGE>
MML Series Investment Fund
FINANCIAL HIGHLIGHTS (Continued)
MML MANAGED BOND FUND
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year $ 11.141 $ 12.405 $ 12.041 $ 12.219 $11.318
--------- --------- --------- --------- -------
Income from investment
operations:
Net investment income .782 .792 .785 .870 .903
Net realized and unrealized
gain (loss) on investments
and forward commitments 1.307 (1.264) .618 .001 .916
--------- --------- --------- --------- -------
Total from investment
operations 2.089 (.472) 1.403 .871 1.819
--------- --------- --------- --------- -------
Less distributions:
Dividends from net
investment income (.782) (.792) (.784) (.869) (.902)
Distribution from net
realized gains -- -- (.255) (.158) (.016)
Distribution in excess of
net realized gains -- -- -- (.022) --
--------- --------- --------- --------- -------
Total distributions (.782) (.792) (1.039) (1.049) (.918)
--------- --------- --------- --------- -------
Net asset value:
End of year $ 12.448 $ 11.141 $ 12.405 $ 12.041 $12.219
========= ========= ========= ========= =======
Total return 19.14% (3.76%) 11.81% 7.31% 16.66%
Net assets (in millions):
End of year $ 158.70 $ 121.21 $ 129.11 $ 88.15 $ 66.98
Ratio of expenses to
average net assets .52% .52% .54% .56% .57%
Ratio of net investment
income to average net
assets 6.63% 6.69% 6.37% 7.28% 7.96%
Portfolio turnover rate 70.00% 32.77% 58.81% 39.51% 61.85%
<CAPTION>
1990 1989 1988 1987 1986
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year $11.354 $10.919 $11.052 $12.541 $11.978
------- ------- ------- ------- -------
Income from investment
operations:
Net investment income .943 .918 .906 .969 1.061
Net realized and unrealized
gain (loss) on investments
and forward commitments (.036) .454 (.133) (.673) .597
------- ------- ------- ------- -------
Total from investment
operations .907 1.372 .773 .296 1.658
------- ------- ------- ------- -------
Less distributions:
Dividends from net
investment income (.943) (.918) (.906) (1.229) (1.095)
Distribution from net
realized gains -- (.019) -- (.556) --
Distribution in excess of
net realized gains -- -- -- -- --
------- ------- ------- ------- -------
Total distributions (.943) (.937) (.906) (1.785) (1.095)
------- ------- ------- ------- -------
Net asset value:
End of year $11.318 $11.354 $10.919 $11.052 $12.541
======= ======= ======= ======= =======
Total return 8.38% 12.83% 7.13% 2.60% 14.46%
Net assets (in millions):
End of year $ 43.07 $ 40.03 $ 31.35 $ 26.16 $ 30.38
Ratio of expenses to
average net assets .57% .59% .61% .60% .60%
Ratio of net investment
income to average net
assets 8.40% 8.35% 8.25% 8.24% 8.87%
Portfolio turnover rate 69.93% 64.77% 74.92% 55.60% 203.76%
</TABLE>
MML BLEND FUND
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year $ 17.672 $ 18.305 $ 17.846 $ 17.307 $14.839
--------- --------- --------- --------- -------
Income from investment
operations:
Net investment income .811 .707 .655 .707 .736
Net realized and unrealized
gain (loss) on investments
and forward commitments 3.246 (.271) 1.057 .880 2.771
--------- --------- --------- --------- -------
Total from investment
operations 4.057 .436 1.712 1.587 3.507
--------- --------- --------- --------- -------
Less distributions:
Dividends from net
investment income (.811) (.707) (.655) (.707) (.736)
Distribution from net
realized gains (.399) (.359) (.598) (.326) (.303)
Distribution in excess of
net realized gains -- (.003) -- (.015) --
--------- --------- --------- --------- -------
Total distributions (1.210) (1.069) (1.253) (1.048) (1.039)
--------- --------- --------- --------- -------
Net asset value:
End of year $ 20.519 $ 17.672 $ 18.305 $ 17.846 $17.307
========= ========= ========= ========= =======
Total return 23.28% 2.48% 9.70% 9.36% 24.00%
Net assets (in millions):
End of year $1,823.14 $1,444.26 $1,296.54 $1,013.28 $797.04
Ratio of expenses to
average net assets .38% .39% .40% .41% .42%
Ratio of net investment
income to average net
assets 4.19% 3.93% 3.60% 4.07% 4.54%
Portfolio turnover rate 30.78% 26.59% 20.20% 25.43% 26.92%
<CAPTION>
1990 1989 1988 1987 1986
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year $15.428 $13.876 $13.095 $13.774 $12.244
------- ------- ------- ------- -------
Income from investment
operations:
Net investment income .792 .823 .734 .624 .540
Net realized and unrealized
gain (loss) on investments
and forward commitments (.445) 1.921 1.000 (.148) 1.653
------- ------- ------- ------- -------
Total from investment
operations .347 2.744 1.734 .476 2.193
------- ------- ------- ------- -------
Less distributions:
Dividends from net
investment income (.811) (.835) (.728) (.747) (.560)
Distribution from net
realized gains (.125) (.357) (.225) (.408) (.103)
Distribution in excess of
net realized gains -- -- -- -- --
------- ------- ------- ------- -------
Total distributions (.936) (1.192) (.953) (1.155) (.663)
------- ------- ------- ------- -------
Net asset value:
End of year $14.839 $15.428 $13.876 $13.095 $13.774
======= ======= ======= ======= =======
Total return 2.37% 19.96% 13.40% 3.12% 18.30%
Net assets (in millions):
End of year $574.15 $524.29 $401.22 $346.12 $236.15
Ratio of expenses to
average net assets .44% .45% .46% .48% .51%
Ratio of net investment
income to average net
assets 5.37% 5.57% 5.29% 4.77% 4.81%
Portfolio turnover rate 24.55% 22.39% 25.70% 36.56% 58.75%
</TABLE>
Total return information shown in the Financial Highlights tables does not
reflect expenses that apply at the separate account level or to related
insurance products. Inclusion of these charges would reduce the total return
figures for all periods shown.
See Notes to Financial Statements
9
<PAGE>
MML Equity Fund
SCHEDULE OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note 2A)
------------ ------------
<S> <C> <C>
EQUITIES - 92.49%
Aerospace & Defense - 2.23%
The Boeing Company......................... 202,500 $ 15,870,938
TRW, Inc................................... 154,100 11,942,750
------------ ------------
356,600 27,813,688
------------ ------------
Agribusiness - 1.56%
Archer-Daniels-Midland Company............. 359,975 6,479,550
Pioneer Hi-Bred International, Inc......... 235,000 13,071,875
------------ ------------
594,975 19,551,425
------------ ------------
Apparel, Textiles, Shoes - .93%
VF Corporation............................. 220,000 11,605,000
------------ ------------
Automotive & Parts - 4.20%
Ford Motor Company......................... 477,000 13,833,000
Genuine Parts Company...................... 433,500 17,773,500
Goodyear Tire & Rubber Company............. 461,000 20,917,875
------------ ------------
1,371,500 52,524,375
------------ ------------
Banking, Savings & Loans - 6.16%
The Bank of New York Company,
Incorporated.............................. 435,000 21,206,250
Comerica, Incorporated..................... 435,000 17,454,375
CoreStates Financial Corporation........... 410,500 15,547,687
Norwest Corporation........................ 291,000 9,603,000
Wachovia Corporation....................... 288,200 13,185,150
------------ ------------
1,859,700 76,996,462
------------ ------------
Beverages - 1.95%
Brown-Forman Corporation (Class B)......... 333,000 12,154,500
Pepsico, Incorporated...................... 218,000 12,180,750
------------ ------------
551,000 24,335,250
------------ ------------
Chemicals - 4.03%
Eastman Chemical Company................... 240,000 15,030,000
E.I. du Pont de Nemours and Company........ 166,500 11,634,187
The Lubrizol Corporation................... 242,000 6,745,750
Nalco Chemical Company..................... 335,000 10,091,875
Rohm & Haas................................ 106,300 6,843,063
------------ ------------
1,089,800 50,344,875
------------ ------------
Communications - 2.18%
AT&T Corporation........................... 420,000 27,195,000
------------ ------------
Computers & Office Equipment - 6.41%
Hewlett-Packard Company.................... 385,000 32,243,750
International Business Machines Corporation 121,000 11,101,750
Pitney Bowes, Inc.......................... 423,500 19,904,500
Xerox Corporation.......................... 123,000 16,851,000
------------ ------------
1,052,500 80,101,000
------------ ------------
Containers - .97%
Temple-Inland, Inc......................... 273,500 12,068,188
------------ ------------
Cosmetics & Personal Care - 1.28%
Kimberly-Clark Corporation................. 193,600 16,020,400
------------ ------------
Electric Utilities - 1.84%
Niagara Mohawk Power Corporation........... 463,500 4,461,187
NIPSCO Industries, Inc..................... 200,000 7,650,000
SCANA Corporation.......................... 378,000 10,820,250
------------ ------------
1,041,500 22,931,437
------------ ------------
<CAPTION>
Number Market
of Value
Shares (Note 2A)
------------ ------------
<S> <C> <C>
EQUITIES (Continued)
Electrical Equipment & Electronics - 7.53%
AMP, Incorporated.......................... 580,000 $ 22,257,500
General Electric Company................... 470,000 33,840,000
General Signal Corporation................. 269,500 8,725,063
Honeywell Inc.............................. 272,500 13,250,313
Hubbell, Incorporated (Class B)............ 242,072 15,916,234
------------ ------------
1,834,072 93,989,110
------------ ------------
Energy - 8.65%
Amoco Corporation.......................... 380,000 27,312,500
Atlantic Richfield Company................. 175,500 19,436,625
Chevron Corporation........................ 360,000 18,900,000
Kerr-McGee Corporation..................... 250,100 15,881,350
Mobil Corporation.......................... 197,200 22,086,400
USX Corporation - Marathon Group........... 145,000 2,827,500
Union Pacific Resources Group, Inc......... 62,100 1,575,787
------------ ------------
1,569,900 108,020,162
------------ ------------
Financial Services - 1.33%
American Express Company................... 400,000 16,550,000
------------ ------------
Foods - 1.57%
CPC International, Inc..................... 285,000 19,558,125
------------ ------------
Forest Products & Paper - 2.37%
Westvaco Corporation....................... 335,755 9,317,201
Weyerhaeuser Company....................... 467,500 20,219,375
------------ ------------
803,255 29,536,576
------------ ------------
Hardware & Tools - 1.30%
The Stanley Works.......................... 315,500 16,248,250
------------ ------------
Healthcare - 9.60%
Becton, Dickinson and Company.............. 260,000 19,500,000
Bristol-Myers Squibb Company............... 507,500 43,581,562
Pfizer, Incorporated....................... 600,000 37,800,000
Schering-Plough Corp....................... 347,500 19,025,625
------------ ------------
1,715,000 119,907,187
------------ ------------
Household Products - .91%
The Clorox Company......................... 159,500 11,424,188
------------ ------------
Industrial Distribution - 1.25%
W. W. Grainger, Inc........................ 236,000 15,635,000
------------ ------------
Industrial Transportation - 1.54%
Norfolk Southern Corporation............... 242,000 19,208,750
------------ ------------
Insurance - 4.92%
Allstate Corporation....................... 185,182 7,615,610
Jefferson-Pilot Corporation................ 207,000 9,625,500
MBIA, Inc.................................. 154,000 11,550,000
SAFECO Corporation......................... 750,000 25,875,000
Unitrin, Inc............................... 140,000 6,720,000
------------ ------------
1,436,182 61,386,110
------------ ------------
Machinery & Components - 1.62%
Dover Corporation.......................... 325,000 11,984,375
Parker-Hannifin Corporation................ 242,050 8,290,213
------------ ------------
567,050 20,274,588
------------ ------------
Metals & Mining - .27%
Reynolds Metals Company.................... 60,000 3,397,500
------------ ------------
</TABLE>
10
<PAGE>
MML Equity Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note 2A)
------------ ------------
<S> <C> <C>
EQUITIES (Continued)
Miscellaneous - 2.59%
Harsco Corporation......................... 169,500 $ 9,852,187
Minnesota Mining &
Manufacturing Company..................... 340,000 22,525,000
------------ ------------
509,500 32,377,187
------------ ------------
Photography - 1.21%
Eastman Kodak Company...................... 225,000 15,075,000
------------ ------------
Publishing & Printing - 4.35%
The Dun & Bradstreet Corporation........... 308,500 19,975,375
McGraw-Hill Companies, Inc................. 224,000 19,516,000
R. R. Donnelley & Sons Company............. 378,000 14,883,750
------------ ------------
910,500 54,375,125
------------ ------------
Retail - 2.32%
J.C. Penney Company, Inc................... 89,400 4,257,675
The May Department Stores Company.......... 363,000 15,336,750
Sears Roebuck and Company.................. 242,000 9,438,000
------------ ------------
694,400 29,032,425
------------ ------------
Retail - Grocery - 1.20%
Albertson's, Inc........................... 455,200 14,964,700
------------ ------------
Telephone Utilities - 2.64%
Ameritech Corporation...................... 182,000 10,738,000
Frontier Corporation....................... 423,500 12,705,000
Southern New England
Telecommunications Corporation............ 240,000 9,540,000
------------ ------------
845,500 32,983,000
------------ ------------
Tobacco - 1.58%
American Brands, Inc....................... 442,000 19,724,250
------------ ------------
Total Equities
(Cost $784,795,485)........................ 1,155,154,333
-------------
<CAPTION>
Principal
Amount
-----------
<S> <C> <C>
SHORT-TERM INVESTMENTS - 11.69%
Commercial Paper
Aristar, Inc.
5.600% 2/14/96.................... $ 3,480,000 3,456,181
Comdisco, Inc.
6.030% 1/11/96.................... 3,545,000 3,539,062
Comdisco, Inc.
6.030% 1/12/96.................... 3,300,000 3,293,920
Comdisco, Inc.
6.000% 1/22/96.................... 4,610,000 4,593,235
Comdisco, Inc.
5.950% 2/12/96.................... 4,790,000 4,756,356
ConAgra, Inc.
5.970% 1/3/96..................... 5,585,000 5,583,148
ConAgra, Inc.
5.930% 1/24/96.................... 3,615,000 3,601,304
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
SHORT-TERM INVESTMENTS (Continued)
Commercial Paper (Continued)
ConAgra, Inc.
5.930% 2/1/96..................... $ 4,590,000 $ 4,566,562
ConAgra, Inc.
5.770% 2/6/96..................... 3,835,000 3,812,872
Dana Credit Corporation
6.000% 1/31/96.................... 6,220,000 6,187,578
Dana Credit Corporation
5.950% 2/16/96.................... 4,295,000 4,261,793
Dana Credit Corporation
5.820% 3/21/96.................... 3,165,000 3,123,042
Dominion Resources Inc.
6.010% 1/23/96.................... 5,200,000 5,180,901
Florida Power & Light Co.
5.580% 2/7/96..................... 2,255,000 2,242,068
GTE Corporation
5.950% 2/2/96..................... 5,225,000 5,197,366
GTE Corporation
5.830% 2/9/96..................... 5,900,000 5,862,737
Illinois Power Company
6.000% 1/25/96.................... 3,225,000 3,212,100
Illinois Power Company
6.100% 2/5/96..................... 2,380,000 2,365,885
Illinois Power Company
5.930% 2/8/96..................... 4,000,000 3,974,962
MAPCO Inc.
6.050% 1/5/96..................... 4,575,000 4,571,925
MAPCO Inc.
6.000% 1/8/96..................... 4,385,000 4,379,884
MAPCO Inc.
6.000% 1/10/96.................... 4,000,000 3,994,000
ORIX Credit Alliance, Inc.
6.080% 1/17/96.................... 5,865,000 5,848,749
ORIX Credit Alliance, Inc.
6.070% 1/19/96.................... 5,160,000 5,144,178
ORIX Credit Alliance, Inc.
6.000% 1/26/96.................... 4,000,000 3,983,333
ORIX Credit Alliance, Inc.
6.070% 1/30/96.................... 4,000,000 3,980,175
ORIX Credit Alliance, Inc.
5.750% 2/14/96.................... 8,000,000 7,943,778
Public Service Company of Colorado
6.000% 1/29/96.................... 6,410,000 6,380,087
Rite Aid Corporation
5.900% 2/26/96.................... 3,790,000 3,754,926
Rite Aid Corporation
5.980% 1/16/96.................... 3,500,000 3,491,057
Texas Utilities Electric Company
5.950% 1/2/96..................... 4,000,000 3,999,339
Textron, Inc.
5.970% 2/29/96.................... 1,500,000 1,485,146
Tyson Foods, Inc.
6.050% 1/4/96..................... 1,340,000 1,339,324
Tyson Foods, Inc.
5.990% 1/9/96..................... 2,745,000 2,741,346
Tyson Foods, Inc.
5.990% 1/18/96.................... 4,165,000 4,152,537
------------ ------------
Total Short-Term Investments
(Cost $146,006,980)....................... $146,650,000 146,000,856
============ ============
</TABLE>
11
<PAGE>
MML Equity Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Value
(Note 2A)
--------------
<S> <C> <C>
Total Investments -
(Cost $930,802,465) (a) 104.18% $1,301,155,189
Other Assets - 27 3,422,570
Liabilities - (4.45) (55,678,753)
------- --------------
Net Assets - 100.00% $1,248,899,006
======= ==============
(a) Federal Income Tax Information: At
December 31, 1995 the net unrealized
appreciation on investments based on cost
of $930,814,277 for federal income tax
purposes is as follows:
Aggregate gross unrealized appreciation for
all investments in which there is an excess
of market value over tax cost.................. $ 378,715,018
Aggregate gross unrealized depreciation for
all investments in which there is an excess
of tax cost over market value.................. (8,374,106)
--------------
Net unrealized appreciation.................... $ 370,340,912
==============
</TABLE>
See Notes to Financial Statements.
12
<PAGE>
MML Money Market Fund
SCHEDULE OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
SHORT-TERM INVESTMENTS - 100.57%
Commercial Paper
Anheuser-Busch Companies, Inc.
5.550% 3/7/96..................... $ 2,115,000 $ 2,093,480
Aristar, Inc.
5.780% 1/30/96.................... 4,000,000 3,981,375
Atlantic Richfield Corp.
5.600% 2/9/96..................... 2,800,000 2,783,013
Baltimore Gas & Electric Company
5.680% 1/19/96.................... 3,015,000 3,006,437
Bell Atlantic Network Funding Corp.
5.450% 2/22/96.................... 2,035,000 2,018,980
Bell Atlantic Network Funding Corp.
5.510% 2/23/96.................... 2,265,000 2,246,626
Campbell Soup Company
5.650% 1/16/96.................... 3,210,000 3,202,443
Caterpillar Financial Services Corp.
5.650% 2/15/96.................... 1,915,000 1,901,475
Coca Cola Company
5.580% 2/2/96..................... 1,425,000 1,417,932
Coca Cola Company
5.350% 3/6/96..................... 1,000,000 990,340
Coca Cola Financial Corporation
5.580% 2/1/96..................... 1,845,000 1,836,135
Consolidated Natural Gas Company
5.630% 2/6/96..................... 1,435,000 1,426,921
Dresser Industries, Inc.
5.750% 1/31/96.................... 2,200,000 2,189,458
Dresser Industries, Inc.
5.650% 1/26/96.................... 1,800,000 1,792,938
E.I. du Pont de Nemours and Company
5.660% 1/17/96.................... 3,015,000 3,007,416
Echlin Inc.
5.710% 1/26/96.................... 2,000,000 1,992,069
Eli Lilly & Company
5.670% 1/19/96.................... 1,890,000 1,884,642
Eli Lilly & Company
5.550% 3/28/96.................... 2,400,000 2,367,810
Ford Motor Credit Company
5.350% 7/22/96.................... 4,000,000 3,879,328
GTE Corporation
5.850% 2/14/96.................... 2,545,000 2,526,803
GTE Corporation
5.840% 2/16/96.................... 230,000 228,284
GTE Corporation
5.600% 3/5/96..................... 1,580,000 1,564,270
General Electric Company
5.420% 5/3/96..................... 1,125,000 1,104,167
General Motors Acceptance Corporation
5.570% 3/15/96.................... 2,080,000 2,056,185
General Motors Acceptance Corporation
5.847% 1/2/96..................... 510,000 510,000
Georgia Power Company
5.610% 3/6/96..................... 360,000 356,354
Georgia Power Company
5.640% 2/12/96.................... 3,900,000 3,874,338
Great Lakes Chemical Corp.
5.670% 1/22/96.................... 1,735,000 1,729,261
Hercules Incorporated
5.660% 2/16/96.................... 1,870,000 1,856,476
Hercules Incorporated
5.350% 6/19/96.................... 1,600,000 1,559,578
Indianapolis Power & Light Company
5.680% 1/25/96.................... 2,025,000 2,017,332
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
SHORT-TERM INVESTMENTS (Continued)
Commercial Paper (Continued)
John Deere Capital Corporation
5.680% 2/13/96.................... $ 3,930,000 $ 3,903,337
McCormick & Company Inc.
5.600% 1/29/96.................... 2,855,000 2,842,565
Minnesota Mining and Manufacturing Company
5.480% 3/14/96.................... 2,460,000 2,432,664
Nestle Capital Corporation
5.660% 1/23/96.................... 1,595,000 1,589,483
Nestle Capital Corporation
5.370% 4/11/96.................... 2,720,000 2,679,021
Northern Illinois Gas Company
5.670% 1/12/96.................... 4,500,000 4,492,204
Northern States Power Company
5.680% 1/18/96.................... 2,020,000 2,014,582
Pacificorp
5.710% 1/5/96..................... 1,570,000 1,569,004
Pacificorp
5.700% 2/7/96..................... 2,250,000 2,236,819
J.C. Penney Funding Corp.
5.650% 2/8/96..................... 3,785,000 3,762,427
Pepsico Inc.
5.700% 1/12/96.................... 820,000 818,572
Pepsico Inc.
5.550% 2/6/96..................... 1,770,000 1,760,177
Pioneer Hi-Bred International, Inc.
5.700% 1/24/96.................... 3,375,000 3,362,709
Pitney Bowes Credit Corporation
5.620% 2/5/96..................... 3,060,000 3,043,281
Proctor & Gamble Company
5.610% 2/21/96.................... 4,000,000 3,968,210
Southern New England Telecommunications
Corporation
5.700% 1/31/96.................... 1,530,000 1,522,733
Southwestern Bell Telephone Company
5.500% 2/27/96.................... 4,180,000 4,143,599
------------ ------------
<CAPTION>
Total Short-Term Investments
(Cost $109,543,253) (a) $110,345,000 109,543,253
============ ------------
<S> <C> <C>
Total Investments -
(Cost $109,543,253) (a) 100.57% 109,543,253
Other Assets - .01 3,459
Liabilities - (.58) (626,511)
------- ------------
Net Assets - 100.00% $108,920,201
======= ============
</TABLE>
(a) Federal Income Tax Information: The aggregate cost for investments
for the MML Money Market Fund as of December 31, 1995 is the same for
financial reporting and federal income tax purposes.
December 31, 1995 seven-day average yield for the portfolio: 5.25%
See Notes to Financial Statements.
13
<PAGE>
MML Managed Bond Fund
SCHEDULE OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
BONDS AND NOTES - 95.72%
Asset Backed Securities - 10.03%
Auto Receivables
Daimler-Benz Auto Grantor Trust 1995-A
5.850% 5/15/02..................... $ 2,883,620 $ 2,894,433
Daimler-Benz Vehicle Trust 1994-A
5.950% 12/15/00.................... 660,968 662,059
Ford Credit 1994-B Grantor Trust
7.300% 10/15/99.................... 959,110 977,390
GMAC 1992-E Grantor Trust
4.750% 8/15/97..................... 321,666 320,257
Honda Auto Receivables 1992-A Grantor Trust
4.900% 6/15/98..................... 195,325 194,653
Jet Equipment Trust 1995-A
8.235% 5/1/15...................... 1,990,986 2,187,895
Midlantic Auto Grantor Trust 1992-1
4.300% 9/15/97..................... 93,624 93,594
Nissan Auto Receivables 1994-A Grantor Trust
6.450% 9/15/99..................... 1,547,068 1,560,110
Railcar Trust No. 1992-1
7.750% 6/1/04...................... 1,715,380 1,849,385
World Omni 1994-A Automobile Lease
Securitization Trust
6.450% 9/25/00..................... 2,131,553 2,145,110
World Omni 1995-A Automobile Lease
Securitization Trust
6.050% 11/25/01.................... 3,000,000 3,026,250
------------ ------------
Total Asset Backed Securities
(Cost $15,716,572) 15,499,300 15,911,136
------------ ------------
Corporate Debt - 51.52%
American Airlines, Inc.
9.780% 11/26/11.................... 2,000,000 2,364,400
AMR Corporation
9.000% 8/1/12...................... 1,000,000 1,127,770
Analog Devices, Inc.
6.625% 3/1/00...................... 1,000,000 1,012,980
Associates Corporation of North America
7.875% 9/30/01..................... 2,000,000 2,182,260
Atlantic Richfield Company
7.770% 2/13/02..................... 3,000,000 3,275,310
BP America Inc.
8.500% 4/15/01..................... 2,000,000 2,240,220
Bell Atlantic Financial Services, Inc.
6.610% 2/4/00...................... 2,000,000 2,064,600
Columbia Gas System, Inc.
6.610% 11/28/02.................... 2,000,000 2,036,220
Commercial Credit Company
7.750% 3/1/05...................... 3,000,000 3,333,180
Corning Glass Works, Inc.
8.875% 3/15/16..................... 500,000 603,690
Dow Capital
7.125% 1/15/03..................... 4,000,000 4,167,880
English China Clays Delaware, Inc.
7.375% 10/1/02..................... 1,000,000 1,059,300
Equifax, Inc.
6.500% 6/15/03..................... 1,250,000 1,273,950
ERAC USA Finance Company 144A
7.875% 3/15/98..................... 1,500,000 1,576,875
Foster Wheeler Corporation
6.750% 11/15/05.................... 2,000,000 2,061,620
General Electric Capital Corporation
8.750% 5/21/07..................... 1,000,000 1,206,390
General Motors Acceptance Corporation
6.300% 9/10/97..................... 2,500,000 2,529,150
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
BONDS AND NOTES (Continued)
Corporate Debt (Continued)
The Goldman Sachs Group, L.P. 144A
6.200% 2/15/01..................... $ 2,000,000 $ 2,004,360
Hercules Incorporated
6.625% 6/1/03...................... 2,000,000 2,055,180
Imcera Group, Inc.
6.000% 10/15/03.................... 2,000,000 1,924,780
ITT Corporation (New)
7.375% 11/15/15.................... 3,500,000 3,608,500
Leucadia National Corporation
7.750% 8/15/13..................... 2,000,000 2,070,380
Lockheed Corporation
5.650% 4/1/97...................... 2,000,000 1,995,500
McDonnell Douglas Corporation
9.250% 4/1/02...................... 1,400,000 1,630,160
Newmont Mining Corporation
8.625% 4/1/02...................... 2,000,000 2,209,980
News America Holdings Incorporated
9.250% 2/1/13...................... 1,000,000 1,177,840
Penske Truck Leasing Co., L.P.
7.750% 5/15/99..................... 1,250,000 1,305,450
Polaroid Corporation
7.250% 1/15/97..................... 1,000,000 1,013,290
Polaroid Corporation
8.000% 3/15/99..................... 1,000,000 1,056,350
Ralston Purina Company
7.750% 10/1/15..................... 3,000,000 3,222,240
Rolls-Royce Capital Inc.
7.125% 7/29/03..................... 1,500,000 1,564,890
Service Corporation International
7.000% 6/1/15...................... 2,250,000 2,507,018
Tenaga Nasional Berhad 144A
7.875% 6/15/04..................... 1,250,000 1,373,563
Textron Inc.
9.550% 3/19/01..................... 1,000,000 1,136,100
Thomas & Betts Corporation
8.250% 1/15/04..................... 1,500,000 1,645,035
Time Warner, Inc.
7.750% 6/15/05..................... 3,000,000 3,123,090
US West Capital Funding Corporation
8.375% 10/18/99.................... 3,000,000 3,262,140
Union Oil of California
8.750% 8/15/01..................... 1,500,000 1,669,890
United Air Lines, Inc.
10.110% 2/19/06..................... 476,860 540,998
Valassis Communications, Inc.
9.550% 12/1/03..................... 2,000,000 2,039,240
Westinghouse Electric Corporation
8.375% 6/15/02..................... 1,200,000 1,237,680
W.R. Grace & Co.
7.750% 10/1/02..................... 2,100,000 2,273,250
------------ ------------
Total Corporate Debt
(Cost $78,945,707).......................... 76,676,860 81,762,699
============ ============
</TABLE>
14
<PAGE>
MML Managed Bond Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
BONDS AND NOTES (Continued)
U.S. Government Agency Obligations - 19.01%
Federal Home Loan Mortgage
Corporation (FHLMC) - 4.06%
Collateralized Mortgage Obligations - 3.91%
FHLMC Series 1080 Class D
7.000% 7/15/20..................... $ 2,000,000 $ 2,032,500
FHLMC Series 1322 Class G
7.500% 2/15/07..................... 2,000,000 2,088,740
FHLMC Series 1460 Class H
7.000% 5/15/07..................... 2,000,000 2,072,500
------------ ------------
6,000,000 6,193,740
------------ ------------
Pass-Through Securities - .15%
FHLMC
9.000% 3/1/17...................... 228,281 242,521
------------ ------------
6,228,281 6,436,261
------------ ------------
Federal National Mortgage
Association (FNMA) - 3.32%
Collateralized Mortgage Obligations - 2.81%
FNMA Series 1993-175 Class PL
5.000% 10/25/02.................... 2,000,000 1,980,000
FNMA Series 1993-191 Class PD
5.400% 3/25/04..................... 1,500,000 1,486,395
FNMA Series 1993-221 Class PD
6.000% 12/25/08.................... 1,000,000 989,680
------------ ------------
4,500,000 4,456,075
------------ ------------
Pass-Through Securities - .51%
FNMA
9.000% 5/1/09...................... 761,881 809,971
------------ ------------
5,261,881 5,266,046
------------ ------------
Government National Mortgage
Association (GNMA) - 9.10%
Collateralized Mortgage Obligations - .60%
JHM Acceptance Corporation, Series E Class 5
8.960% 4/1/19...................... 895,053 956,587
------------ ------------
Pass-Through Securities - 8.50%
GNMA
8.000% 6/15/06 - 3/15/08........... 6,449,335 6,833,391
GNMA - ARMS
6.000% 7/20/25 - 12/20/25.......... 6,586,262 6,659,175
------------ ------------
13,035,597 13,492,566
------------ ------------
13,930,650 14,449,153
------------ ------------
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
BONDS AND NOTES (Continued)
U.S. Government Guaranteed Notes - 2.53%
1994-A Atlanta, GA
5.780% 8/1/98...................... $ 130,000 $ 130,637
1994-A Baxter Springs, KS
5.780% 8/1/98...................... 700,000 703,430
1994-A Boston, MA
5.780% 8/1/98...................... 745,000 748,650
1994-A Detroit, MI
5.780% 8/1/98...................... 385,000 386,887
1994-A Egg Harbor, NJ
5.780% 8/1/98...................... 260,000 261,274
1994-A Kansas City, MO
5.780% 8/1/98...................... 550,000 552,695
1994-A Mayaguez, PR
5.780% 8/1/98...................... 295,000 296,446
1994-A Rochester, NY
5.780% 8/1/98...................... 300,000 301,470
1994-A Sacramento, CA
5.780% 8/1/98...................... 55,000 55,270
1994-A Saginaw, MI
5.780% 8/1/98...................... 315,000 316,544
1994-A Youngstown, OH
5.780% 8/1/98...................... 265,000 266,299
------------ ------------
4,000,000 4,019,602
------------ ------------
Total U.S. Government Agency Obligations
(Cost $29,136,748).......................... 29,420,812 30,171,062
------------ ------------
U.S. Treasury Obligations - 15.16%
U.S. Treasury Bonds - 9.28%
U.S. Treasury Bond
8.875% 8/15/17..................... 11,000,000 14,733,070
------------ ------------
U.S. Treasury Notes - 3.50%
U.S. Treasury Note
7.250% 5/15/04..................... 5,000,000 5,550,000
------------ ------------
U.S. Treasury Strips - 2.38%
U.S. Treasury Strip - Principal Only
0.000% 2/15/15..................... 12,200,000 3,775,290
------------ ------------
Total U.S. Treasury Obligations
(Cost $21,674,338).......................... 28,200,000 24,058,360
------------ ------------
Total Bonds and Notes
(Cost $145,473,365)......................... $149,796,972 151,903,257
============ ============
</TABLE>
15
<PAGE>
MML Managed Bond Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
SHORT-TERM INVESTMENTS - 1.62%
Commercial Paper
ORIX Credit Alliance, Inc.
6.400% 1/5/96........................ $ 2,185,000 $ 2,183,446
Ryder System Inc.
6.000% 1/2/96........................ 395,000 394,934
------------ ------------
Total Short-Term Investments
(Cost $2,578,380) $ 2,580,000 2,578,380
============ ------------
<CAPTION>
<S> <C> <C>
Total Investments
(Cost $148,051,745) (a) 97.34% 154,481,637
Other Assets - 9.33 14,800,734
Liabilities - (6.67) (10,584,233)
------- ------------
Net Assets - 100.00% $158,698,138
======= ============
</TABLE>
(a) Federal Income Tax Information. At
December 31, 1995 the net unrealized
appreciation on investments based on
cost of $148,061,936 for federal income
tax purposes is as follows.
Aggregate gross unrealized appreciation for
all investments and forward commitments in
which there is an excess of market value over
tax cost................................................. $ 7,077,046
Aggregate gross unrealized depreciation for
all investments and forward commitments in
which there is an excess of tax cost over
market value............................................. (657,345)
------------
Net unrealized appreciation........................... $ 6,419,701
============
See Notes to Financial Statements
16
<PAGE>
MML Blend Fund
SCHEDULE OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note 2A)
------------ ------------
<S> <C> <C>
EQUITIES - 55.32%
Aerospace & Defense - 1.42%
The Boeing Company.......................... 193,500 $ 15,165,563
TRW, Inc.................................... 138,500 10,733,750
------------ ------------
332,000 25,899,313
------------ ------------
Agribusiness - .95%
Archer-Daniels-Midland Company.............. 318,017 5,724,306
Pioneer Hi-Bred International, Inc.......... 208,000 11,570,000
------------ ------------
526,017 17,294,306
------------ ------------
Apparel, Textiles, Shoes - .60%
VF Corporation.............................. 208,000 10,972,000
------------ ------------
Automotive & Parts - 2.57%
Ford Motor Company.......................... 410,000 11,890,000
Genuine Parts Company....................... 397,000 16,277,000
Goodyear Tire & Rubber Company.............. 412,200 18,703,575
------------ ------------
1,219,200 46,870,575
------------ ------------
Banking, Savings & Loans - 3.85%
The Bank of New York Company, Incorporated.. 390,000 19,012,500
Comerica, Incorporated...................... 397,000 15,929,625
CoreStates Financial Corporation............ 374,800 14,195,550
Norwest Corporation......................... 262,000 8,646,000
Wachovia Corporation........................ 270,600 12,379,950
------------ ------------
1,694,400 70,163,625
------------ ------------
Beverages - 1.25%
Brown-Forman Corporation (Class B).......... 319,500 11,661,750
Pepsico, Incorporated....................... 200,000 11,175,000
------------ ------------
519,500 22,836,750
------------ ------------
Chemicals - 2.12%
Eastman Chemical Company.................... 216,475 13,556,747
E.I. du Pont de Nemours and Company......... 146,000 10,201,750
The Lubrizol Corporation.................... 216,000 6,021,000
Nalco Chemical Company...................... 295,000 8,886,875
------------ ------------
873,475 38,666,372
------------ ------------
Communications - .66%
AT&T Corporation............................ 185,000 11,978,750
------------ ------------
Computers & Office Equipment - 3.88%
Hewlett-Packard Company..................... 343,000 28,726,250
International Business Machines Corporation. 106,000 9,725,500
Pitney Bowes, Inc........................... 371,000 17,437,000
Xerox Corporation........................... 108,000 14,796,000
------------ ------------
928,000 70,684,750
------------ ------------
Cosmetic & Personal Care - .80%
Kimberly-Clark Corporation.................. 176,200 14,580,550
------------ ------------
Electric Utilities - 1.11%
Niagara Mohawk Power Corporation............ 416,000 4,004,000
NIPSCO Industries, Inc...................... 178,000 6,808,500
SCANA Corporation........................... 326,000 9,331,750
------------ ------------
920,000 20,144,250
------------ ------------
Electrical Equipment & Electronics - 4.63%
AMP, Inc.................................... 530,000 20,338,750
General Electric Company.................... 420,000 30,240,000
General Signal Corporation.................. 243,000 7,867,125
Honeywell Inc............................... 243,000 11,815,875
Hubbell, Incorporated (Class B)............. 215,940 14,198,055
------------ ------------
1,651,940 84,459,805
------------ ------------
<CAPTION>
Number Market
of Value
Shares (Note 2A)
------------ ------------
<S> <C> <C>
EQUITIES (Continued)
Energy - 5.08%
Amoco Corporation........................... 332,000 $ 23,862,500
Atlantic Richfield Company.................. 151,000 16,723,250
Chevron Corporation......................... 324,000 17,010,000
Kerr-McGee Corporation...................... 216,000 13,716,000
Mobil Corporation........................... 177,100 19,835,200
Union Pacific Resources Group, Inc.......... 55,400 1,405,775
------------ ------------
1,255,500 92,552,725
------------ ------------
Financial Services - .80%
American Express Company.................... 352,500 14,584,688
------------ ------------
Foods - 1.07%
CPC International, Inc...................... 285,000 19,558,125
------------ ------------
Forest Products & Paper - 1.54%
Westvaco Corporation........................ 363,012 10,073,583
Weyerhaeuser Company........................ 415,000 17,948,750
------------ ------------
778,012 28,022,333
------------ ------------
Hardware & Tools - .81%
The Stanley Works........................... 285,300 14,692,950
------------ ------------
Healthcare - 5.96%
Becton, Dickinson and Company............... 247,800 18,585,000
Bristol-Myers Squibb Company................ 450,000 38,643,750
Pfizer, Incorporated........................ 540,000 34,020,000
Schering-Plough Corp........................ 318,400 17,432,400
------------ ------------
1,556,200 108,681,150
------------ ------------
Household Products - .57%
The Clorox Company.......................... 146,000 10,457,250
------------ ------------
Industrial Distribution - .77%
W. W. Grainger, Inc......................... 212,300 14,064,875
------------ ------------
Industrial Transportation - .92%
Norfolk Southern Corporation................ 212,000 16,827,500
------------ ------------
Insurance - 2.99%
Allstate Corporation........................ 165,501 6,806,228
Jefferson-Pilot Corporation................. 183,000 8,509,500
MBIA, Inc................................... 135,000 10,125,000
SAFECO Corporation.......................... 668,000 23,046,000
Unitrin, Inc................................ 125,000 6,000,000
------------ ------------
1,276,501 54,486,728
------------ ------------
Machinery & Components - 1.05%
Dover Corporation........................... 286,000 10,546,250
Parker-Hannifin Corporation................. 251,750 8,622,438
------------ ------------
537,750 19,168,688
------------ ------------
Metals & Mining - .17%
Reynolds Metals Company..................... 55,000 3,114,375
------------ ------------
Miscellaneous - 1.62%
Harsco Corporation.......................... 159,050 9,244,781
Minnesota Mining &
Manufacturing Company...................... 305,000 20,206,250
------------ ------------
464,050 29,451,031
------------ ------------
Photography - .73%
Eastman Kodak Company....................... 198,500 13,299,500
------------ ------------
</TABLE>
17
<PAGE>
MML Blend Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note 2A)
------------ ------------
<S> <C> <C>
EQUITIES (Continued)
Publishing & Printing - 2.66%
The Dun & Bradstreet Corporation............ 276,000 $ 17,871,000
McGraw-Hill Companies, Inc.................. 200,000 17,425,000
R.R. Donnelley & Sons Company............... 334,000 13,151,250
------------ ------------
810,000 48,447,250
------------ ------------
Retail - 1.42%
J.C. Penney Company, Inc.................... 81,000 3,857,625
The May Department Stores Company........... 324,000 13,689,000
Sears Roebuck and Company................... 216,000 8,424,000
------------ ------------
621,000 25,970,625
------------ ------------
Retail - Grocery - .75%
Albertson's, Inc............................ 418,300 13,751,612
------------ ------------
Telephone Utilities - 1.63%
Ameritech Corporation....................... 170,000 10,030,000
Frontier Corporation........................ 371,000 11,130,000
Southern New England
Telecommunications Corporation............. 216,000 8,586,000
------------ ------------
757,000 29,746,000
------------ ------------
Tobacco - .94%
American Brands, Inc........................ 384,000 17,136,000
------------ ------------
Total Equities
(Cost $627,696,809)......................... 1,008,564,451
-------------
<CAPTION>
Principal
Amount
------------
<S> <C> <C>
BONDS AND NOTES - 15.36%
Asset Backed Securities - 1.16%
Auto Receivables
Daimler-Benz Auto Grantor Trust 1995-A
5.850% 5/15/02..................... $ 2,403,016 2,412,028
Daimler-Benz Vehicle Trust 1994-A
5.950% 12/15/00.................... 1,321,937 1,324,118
Ford Credit Auto Loan Master Trust,
Series 1992-1
6.875% 1/15/99..................... 1,500,000 1,520,625
Ford Credit 1994-B Grantor Trust
7.300% 10/15/99.................... 1,278,813 1,303,187
GMAC 1992-E Grantor Trust
4.750% 8/15/97..................... 193,000 192,154
Honda Auto Receivables 1992-A Grantor Trust
4.900% 6/15/98..................... 195,325 194,653
Nissan Auto Receivables 1994-A Grantor Trust
6.450% 9/15/99..................... 4,177,084 4,212,297
Railcar Trust No. 1992-1
7.750% 6/1/04...................... 1,552,419 1,673,694
World Omni 1994-A Automobile Lease
Securitization Trust
6.450% 9/25/00..................... 4,689,417 4,719,242
World Omni 1995-A Automobile Lease
Securitization Trust
6.050% 11/25/01.................... 3,500,000 3,530,625
------------ ------------
Total Asset Backed Securities
(Cost $20,966,611)......................... 20,811,011 21,082,623
------------ ------------
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
BONDS AND NOTES (Continued)
Corporate Debt - 5.49%
AMR Corporation
9.000% 8/1/12...................... $ 2,000,000 $ 2,255,540
American Airlines, Inc.
9.780% 11/26/11.................... 5,000,000 5,911,000
American Brands, Inc.
8.750% 2/15/96..................... 1,000,000 1,002,850
American General Finance Corporation
7.750% 1/15/97..................... 2,000,000 2,041,440
Analog Devices, Inc.
6.625% 3/1/00...................... 1,500,000 1,519,470
Bell Atlantic Financial Services Inc.
6.610% 2/4/00...................... 1,000,000 1,032,300
Cardinal Distribution, Inc.
8.000% 3/1/97...................... 2,000,000 2,051,560
Chrysler Financial Corp.
6.620% 4/29/97..................... 2,000,000 2,023,180
Columbia Gas System, Inc.
6.610% 11/28/02.................... 3,000,000 3,054,330
Commercial Credit Company
7.750% 3/1/05...................... 2,500,000 2,777,650
Corning Glass Works, Inc.
8.875% 3/15/16..................... 500,000 603,690
Delta Air Lines, Inc.
8.540% 1/2/07...................... 4,578,616 4,962,075
ERAC USA Finance Company 144A
7.875% 3/15/98..................... 4,000,000 4,205,000
English China Clays Delaware, Inc.
7.375% 10/1/02..................... 1,000,000 1,059,300
Ford Motor Credit Company
8.450% 7/15/06..................... 1,500,000 1,521,360
GTE Corporation
9.100% 6/1/03...................... 1,000,000 1,162,710
General Electric Capital Corporation
8.750% 5/21/07..................... 1,500,000 1,809,585
General Motors Acceptance Corporation
9.125% 7/15/01..................... 1,500,000 1,710,120
The Goldman Sachs Group, L.P. 144A
6.200% 2/15/01..................... 4,000,000 4,008,720
ITT Corporation (New)
7.375% 11/15/15.................... 5,000,000 5,155,000
Leucadia National Corporation
7.750% 8/15/13..................... 3,000,000 3,105,570
McDonnell Douglas Corporation
9.250% 4/1/02...................... 2,200,000 2,561,680
Newmont Mining Corporation
8.625% 4/1/02...................... 5,000,000 5,524,950
News America Holdings Incorporated
9.250%..................................... 2,000,000 2,355,680
North Finance (Bermuda) Limited 144A
7.000% 9/15/05..................... 4,000,000 4,080,000
Polaroid Corporation
7.250% 1/15/97..................... 4,500,000 4,559,805
Ralston Purina Company
7.750% 10/1/15..................... 2,000,000 2,148,160
Rolls-Royce Capital Inc.
7.125% 7/29/03..................... 2,000,000 2,086,520
Service Corporation International
7.000% 6/1/15...................... 4,500,000 5,014,035
Tele-Communications, Inc.
7.550% 9/2/03...................... 3,000,000 3,168,390
Tenaga Nasional Berhad 144A
7.875% 6/15/04..................... 2,500,000 2,747,125
Thomas & Betts Corporation
8.250% 1/15/04..................... 1,000,000 1,096,690
</TABLE>
18
<PAGE>
MML Blend Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
BONDS AND NOTES (Continued)-
Time Warner, Inc.
7.750% 6/15/05..................... $ 3,000,000 $ 3,123,090
The Toro Company
11.000% 8/1/17...................... 2,000,000 2,000,000
United States Leasing
International, Inc.
8.750% 5/1/96...................... 3,500,000 3,533,635
Valassis Communications, Inc.
9.550% 12/1/03..................... 2,000,000 2,039,240
Westinghouse Electric Corporation
8.375% 6/15/02..................... 1,000,000 1,031,400
------------ ------------
Total Corporate Debt
(Cost $94,662,584).......................... 93,778,616 100,042,850
------------ ------------
U.S. Government Agency Obligations - 4.03%
Federal Home Loan Mortgage
Corporation (FHLMC) - .93%
Collateralized Mortgage Obligations - .67%
FHLMC Series 1080 Class D
7.000% 7/15/20..................... 5,000,000 5,081,250
FHLMC Series 1322 Class G
7.500% 2/15/07..................... 5,000,000 5,221,850
FHLMC Series 1460 Class 4
7.000% 5/15/07..................... 1,789,000 1,853,851
------------ ------------
11,789,000 12,156,951
------------ ------------
Pass-Through Securities - .26%
FHLMC
9.000% 3/1/17...................... 684,843 727,563
------------ ------------
12,473,843 12,884,514
------------ ------------
Federal National Mortgage
Association (FNMA) - .28%
Collateralized Mortgage Obligations - .08%
FNMA Series 1993-191 Class PD
5.400% 3/25/04..................... 1,500,000 1,486,395
------------ ------------
Pass-Through Securities - .20%
FNMA
5.000% 10/25/02.................... 4,130,000 4,088,700
FNMA
8.000% 5/1/13...................... 3,474,720 3,626,739
------------ ------------
7,604,720 7,715,439
------------ ------------
9,104,720 9,201,834
------------ ------------
Government National Mortgage
Association (GNMA) - 1.64%
Collateralized Mortgage Obligations - .10%
JHM Acceptance Corporation, Series E Class 5
8.960% 4/1/19...................... 1,790,105 1,913,175
------------ ------------
Pass-Through Securities - 1.54%
GNMA
8.000% 1/15/04-5/15/08............. 8,755,864 9,277,277
GNMA
9.000% 8/15/08-9/15/09............. 2,679,591 2,900,658
GNMA - ARMS
6.000% 7/20/25-12/20/25............ 15,725,551 15,900,693
------------ ------------
27,161,006 28,078,628
------------ ------------
28,951,111 29,991,803
------------ ------------
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
BONDS AND NOTES (Continued)
Government National Mortgage
Association (GNMA) (Continued)
U.S. Government Guaranteed Notes - 1.18%
1994-A Abilene, TX
5.780% 8/1/98...................... $ 70,000 $ 70,343
1994-A Bakersfield, CA
5.780% 8/1/98...................... 245,000 246,200
1994-A Barberton, OH
5.780% 8/1/98...................... 75,000 75,367
1994-A Buffalo, NY
5.780% 8/1/98...................... 375,000 376,837
1991-A Caguas, PR
8.740% 8/1/01...................... 280,000 317,719
1991-A Council Bluffs, IA
8.740% 8/1/01...................... 155,000 175,880
1994-A Cumberland, MD
5.780% 8/1/98...................... 55,000 55,269
1994-A Elizabeth, NJ
5.780% 8/1/98...................... 75,000 75,367
1994-A Erie, PA
5.780% 8/1/98...................... 70,000 70,343
1994-A Euclid, OH
5.780% 8/1/98...................... 105,000 105,514
1994-A Fairfax County, VA
5.780% 8/1/98...................... 110,000 110,539
1991-A Fairfax County, VA
8.740% 8/1/01...................... 85,000 96,450
1991-A Fajardo, PR
8.740% 8/1/01...................... 210,000 238,289
1994-A Fort Myers, FL
5.040% 8/1/96...................... 120,000 119,700
1994-A Fort Myers, FL
5.780% 8/1/98...................... 135,000 135,661
1991-A Gasden, AL
8.740% 8/1/01...................... 100,000 113,471
1994-A Jacksonville, FL
5.040% 8/1/96...................... 200,000 199,500
1994-A Lawrence, MA
5.040% 8/1/96...................... 35,000 34,913
1994-A Lawrence, MA
5.780% 8/1/98...................... 40,000 40,196
1994-A Little Rock, AK
5.040% 8/1/96...................... 310,000 309,225
1994-A LA County, CA
5.040% 8/1/96...................... 145,000 144,638
1994-A LA County, CA
5.780% 8/1/98...................... 175,000 175,858
1991-A Lorain, OH
8.740% 8/1/01...................... 30,000 34,041
1994-A Macon, GA
5.040% 8/1/96...................... 25,000 24,938
1994-A Mayaguez, PR
5.780% 8/1/98...................... 65,000 65,319
1991-A Mayaguez, PR
8.740% 8/1/01...................... 150,000 170,207
1994-A Mobile, AL
5.780% 8/1/98...................... 205,000 206,005
1994-A Montgomery County, PA
5.780% 8/1/98...................... 230,000 231,126
1994-A Montgomery County, PA
5.040% 8/1/96...................... 215,000 214,463
1994-A New Orleans, LA
5.780% 8/1/98...................... 175,000 175,857
</TABLE>
19
<PAGE>
MML Blend Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
BONDS AND NOTES (Continued)
U.S. Government Guaranteed Notes (Continued)
1994-A Ocean Shores, WA
5.780% 8/1/98...................... $ 110,000 $ 110,539
1994-A Pasadena, CA
5.780% 8/1/98...................... 140,000 140,686
1994-A Providence, RI
5.040% 8/1/96...................... 40,000 39,900
1994-A Providence, RI
5.780% 8/1/98...................... 50,000 50,245
1994-A Reading, PA
5.040% 8/1/96...................... 15,000 14,962
1994-A Reading, PA
5.780% 8/1/98...................... 65,000 65,319
1994-A Roanoke, VA
5.780% 8/1/98...................... 210,000 211,029
1994-A Rochester, NY
5.040% 8/1/96...................... 155,000 154,613
1994-A Rochester, NY
5.780% 8/1/98...................... 165,000 165,809
1991-A Rochester, NY
8.650% 8/1/00...................... 4,295,000 4,784,029
1994-A Sacramento, CA
5.040% 8/1/96...................... 125,000 124,688
1994-A Sacramento, CA
5.780% 8/1/98...................... 300,000 301,470
1994-A St. Joseph, MO
5.040% 8/1/96...................... 70,000 69,825
1994-A Salt Lake City, UT
5.040% 8/1/96...................... 135,000 134,662
1994-A Schaumburg, IL
5.040% 8/1/96...................... 60,000 59,850
1994-A Syracuse, NY
5.040% 8/1/96...................... 50,000 49,875
1994-A Syracuse, NY
5.780% 8/1/98...................... 50,000 50,245
1994-A Tacoma, WA
5.040% 8/1/96...................... 130,000 129,675
1994-A Tacoma, WA
5.780% 8/1/98...................... 155,000 155,759
1994-A Trenton, NJ
5.040% 8/1/96...................... 120,000 119,700
1994-A Trenton, NJ
5.780% 8/1/98...................... 130,000 130,637
1994-A Virginia Beach, VA
5.780% 8/1/98...................... 260,000 261,274
1994-A Waterford Township, MI
5.780% 8/1/98...................... 55,000 55,269
1994-A Waterford Township, MI
5.040% 8/1/96...................... 50,000 49,875
1994-A West Palm Beach, FL
5.780% 8/1/98...................... 105,000 105,515
U.S. Department of Housing and Urban
Development, Series 1995-A
8.240% 8/1/02...................... 8,475,000 9,557,681
------------ ------------
19,780,000 21,502,366
------------ ------------
Total U.S. Government Agency Obligations
(Cost $69,632,270).......................... 70,309,674 73,580,517
------------ ------------
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
BONDS AND NOTES (Continued)
U.S. Treasury Obligations - 4.68%
U.S. Treasury Bonds - 2.04%
U.S. Treasury Bond
8.750% 5/15/17..................... $ 28,125,000 $ 37,195,313
------------ ------------
U.S. Treasury Notes - 2.43%
U.S. Treasury Note
6.375% 1/15/99..................... 30,000,000 30,932,700
U.S. Treasury Note
7.250% 5/15/04..................... 12,000,000 13,320,000
------------ ------------
42,000,000 44,252,700
------------ ------------
U.S. Treasury Strips - .21%
U.S. Treasury Strip - Principal Only
0.000% 2/15/10..................... 8,750,000 3,794,875
------------ ------------
Total U.S. Treasury Obligations
(Cost $82,556,295).......................... 78,875,000 85,242,888
------------ ------------
Total Bonds and Notes
(Cost $267,817,760)......................... $263,774,301 279,948,878
============ ------------
SHORT-TERM INVESTMENTS - 31.93%
Commercial Paper
Bausch & Lomb, Inc.
5.700% 1/26/96..................... $ 6,745,000 6,716,181
Campbell Soup Company
5.670% 1/2/96...................... 9,165,000 9,163,447
Central and South West Corporation
5.700% 1/22/96..................... 11,250,000 11,209,087
Central and South West Corporation
5.720% 1/19/96..................... 12,170,000 12,132,685
Coca Cola Company
5.580% 2/1/96...................... 11,140,000 11,079,013
Coca Cola Company
5.350% 3/6/96...................... 10,860,000 10,742,048
Comdisco, Inc.
6.000% 1/3/96...................... 14,695,000 14,690,102
ConAgra, Inc.
5.780% 2/21/96..................... 12,350,000 12,244,180
ConAgra, Inc.
5.640% 3/20/96..................... 13,875,000 13,693,276
Consolidated Natural Gas Company
5.650% 1/23/96..................... 5,000,000 4,981,263
Consolidated Natural Gas Company
5.630% 2/6/96...................... 3,525,000 3,503,778
Dana Credit Corporation
5.900% 3/15/96..................... 7,200,000 7,111,450
Dana Credit Corporation
5.880% 3/13/96..................... 10,000,000 9,880,208
Dana Credit Corporation
5.700% 3/21/96..................... 8,995,000 8,875,754
Dean Witter, Discover & Company
5.680% 1/31/96..................... 13,860,000 13,787,754
Dean Witter, Discover & Company
5.700% 2/7/96...................... 16,500,000 16,396,203
Deere Capital Corporation
5.560% 2/29/96..................... 17,070,000 16,900,959
Dial Corp.
5.650% 3/11/96..................... 4,820,000 4,763,800
Echlin Inc.
5.710% 1/23/96..................... 5,265,000 5,245,270
</TABLE>
20
<PAGE>
MML Blend Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S> <C> <C>
SHORT-TERM INVESTMENTS (Continued)
Commercial Paper (Continued)
Echlin Inc.
5.710% 1/24/96..................... $ 7,815,000 $ 7,783,872
GTE California, Inc.
5.780% 2/27/96..................... 7,960,000 7,886,302
GTE Northwest, Inc.
5.580% 3/29/96..................... 11,645,000 11,475,743
Georgia Power Company
5.650% 3/4/96...................... 10,000,000 9,894,583
Hercules Incorporated
5.660% 2/16/96..................... 13,650,000 13,544,463
Hercules Incorporated
5.350% 6/19/96..................... 7,990,000 7,769,221
IBM Credit Corporation
5.630% 2/22/96..................... 16,370,000 16,224,640
IBM Credit Corporation
5.550% 3/5/96...................... 8,650,000 8,557,433
Monsanto Company
5.680% 1/30/96..................... 8,290,000 8,248,913
Nestle Capital Corporation
5.530% 2/23/96..................... 10,000,000 9,908,036
Nestle Capital Corporation
5.530% 2/26/96..................... 10,940,000 10,838,759
Nestle Capital Corporation
5.470% 3/14/96..................... 11,985,000 11,839,516
Northern Illinois Gas Company
5.680% 1/9/96...................... 6,900,000 6,890,644
Northern States Power Company
5.680% 1/18/96..................... 10,725,000 10,692,908
NYNEX Corp.
5.700% 2/2/96...................... 10,000,000 9,945,311
NYNEX Corp.
5.750% 2/8/96...................... 14,625,000 14,528,963
NYNEX Corp.
5.550% 3/19/96..................... 4,680,000 4,619,453
ORIX Credit Alliance, Inc.
6.050% 1/29/96..................... 8,445,000 8,404,588
ORIX Credit Alliance, Inc.
6.000% 2/20/96..................... 7,645,000 7,581,831
ORIX Credit Alliance, Inc.
5.750% 3/21/96..................... 5,900,000 5,821,784
ORIX Credit Alliance, Inc.
5.700% 3/8/96...................... 8,529,000 8,433,641
PHH Corporation
5.680% 1/17/96..................... 10,000,000 9,972,291
Pennsylvania Power & Light Company
6.000% 1/11/96..................... 2,195,000 2,191,342
J.C. Penney Funding Corporation
5.650% 2/12/96..................... 10,000,000 9,929,763
J.C. Penney Funding Corporation
5.620% 2/28/96..................... 7,100,000 7,031,997
PepsiCo, Inc.
5.700% 1/12/96..................... 9,360,000 9,342,549
Pitney Bowes Credit Corporation
5.620% 2/5/96...................... 10,545,000 10,483,279
Proctor & Gamble Company
5.650% 1/25/96..................... 7,600,000 7,567,894
Proctor & Gamble Company
5.620% 2/14/96..................... 10,000,000 9,924,686
Proctor & Gamble Company
5.570% 3/1/96...................... 7,525,000 7,449,279
Public Service Company of Colorado
5.820% 3/22/96..................... 12,000,000 11,839,000
<CAPTION>
Market
Principal Value
Amount (Note 2A)
------------ ------------
<S>.......................................... <C> <C>
SHORT-TERM INVESTMENTS (Continued)
Commercial Paper (Continued)
Public Service Electric and Gas Company
5.900% 1/29/96..................... $ 585,000 $ 582,315
Rite Aid Corporation
5.750% 1/8/96...................... 11,575,000 11,561,267
Rite Aid Corporation
5.920% 2/9/96...................... 7,720,000 7,669,395
Sierra Pacific Power Company
5.950% 1/26/96..................... 5,000,000 4,979,340
SUPERVALU, Inc.
6.020% 2/6/96...................... 7,615,000 7,569,155
Textron Inc.
6.000% 1/16/96..................... 10,500,000 10,473,172
Textron Inc.
5.930% 2/15/96..................... 9,670,000 9,594,296
Textron Inc.
6.000% 1/4/96...................... 8,360,000 8,355,820
Tyson Foods, Inc.
5.850% 1/10/96..................... 10,000,000 9,984,491
Tyson Foods, Inc.
5.870% 1/11/96..................... 7,175,000 7,162,434
Tyson Foods, Inc.
5.910% 1/5/96...................... 8,945,000 8,938,956
VF Corporation
5.850% 2/9/96...................... 5,500,000 5,463,947
Xerox Corporation
5.630% 2/13/96..................... 10,150,000 10,076,519
------------ ------------
Total Short-Term Investments
(Cost $582,413,954)......................... $586,349,000 582,150,249
============ ------------
<CAPTION>
<S> <C> <C>
Total Investments -
(Cost $1,477,928,523) (a) 102.61% 1,870,663,578
Other Assets - 1.25 22,784,224
Liabilities - (3.86) (70,306,872)
------- --------------
Net Assets - 100.00% $1,823,140,930
======= ==============
</TABLE>
<TABLE>
<CAPTION>
Table of Open Forward Commitment Contracts
Forward Aggregate Expiration
Commitment Face Value of of Unrealized
Contracts Contracts Contracts Appreciation
---------- ------------- ----------- ------------
<S> <C> <C> <C> <C>
United States of America
6.500% due 8/15/05 $51,200,000 February 1996 $ 1,388,372
------------
Total Forward Commitment
Contracts $ 1,388,372
===========
</TABLE>
(a) Federal Income Tax Information: At
December 31, 1995 the net unrealized
appreciation on investments and forward
commitment contracts based on cost of
$1,531,480,367 for federal income tax
purposes is as follows:
Aggregate gross unrealized appreciation for
all investments and forward commitments in
which there is an excess of market value
over tax cost......................................... $ 400,196,547
Aggregate gross unrealized depreciation for
all investments and forward commitments in
which there is an excess of tax cost over
market value.......................................... (6,519,128)
---------------
Net unrealized appreciation......................... $ 393,677,419
===============
See Notes to Financial Statements.
21
<PAGE>
MML SERIES INVESTMENT FUND
NOTES TO FINANCIAL STATEMENTS
1. HISTORY
MML Series Investment Fund (the "MML Trust") is registered under the
Investment Company Act of 1940 as a no-load, registered open end, diversified
management investment company. MML Equity Fund, MML Money Market Fund, MML
Managed Bond Fund and MML Blend Fund (the "Funds") are the four series of shares
of the MML Trust. The MML Trust is organized under the laws of the Commonwealth
of Massachusetts pursuant to an Agreement and Declaration of Trust.
The MML Trust was established by Massachusetts Mutual Life Insurance Company
("MassMutual") for the purpose of providing vehicles for the investment of
assets of various separate investment accounts established by MassMutual and by
life insurance companies which are subsidiaries of MassMutual. Shares of the MML
Trust are not offered to the general public. MassMutual at December 31, 1995,
was the beneficial owner of 1.1% of MML Blend Fund's shares.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
consistently by each Fund in the preparation of the financial statements in
conformity with generally accepted accounting principles.
A. INVESTMENT VALUATION
Equity securities are valued on the basis of valuations furnished by a
pricing service, authorized by the Board of Trustees, which provides the
last reported sale price for securities listed on a national securities
exchange, or on the NASDAQ national market system. If securities are
unlisted, or there is no reported sale price, the bid price of the prior
trade date will be used. Long-term bonds are valued on the basis of
valuations furnished by a pricing service, authorized by the Board of
Trustees, which determines valuations taking into account appropriate
factors such as institutional-size, trading in similar groups of securities,
yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other market data.
For MML Equity Fund, MML Managed Bond Fund, and MML Blend Fund, short-term
securities with more than sixty days to maturity from the date of purchase
are valued at market and short-term securities having a maturity from the
date of purchase of sixty days or less are valued at amortized cost. MML
Money Market Fund's portfolio securities are valued at amortized cost in
accordance with a rule of the Securities and Exchange Commission pursuant to
which MML Money Market Fund must adhere to certain conditions. It is the
intention of MML Money Market Fund to maintain a per share net asset value
of $1.00.
B. ACCOUNTING FOR INVESTMENTS
Investment transactions are accounted for on trade date. Dividend income is
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. Premiums and discounts on short-term securities are amortized in
determining interest income.
The cost basis of long-term bonds is not adjusted for amortization of
premium or accrual of discount since MML Managed Bond Fund and MML Blend
Fund do not generally intend to hold such investments until maturity;
however, the MML Trust has elected to accrue for financial reporting
purposes, certain discounts which are required to be accrued for federal
income tax purposes.
Realized gains and losses on investment transactions and unrealized
appreciation and depreciation of investments are reported for financial
statement and federal income tax purposes on the identified cost method.
C. FEDERAL INCOME TAX
The MML Trust has established a policy for each of the Funds to comply with
the provisions of the Internal Revenue Code applicable to regulated
investment companies. As a result, the Funds will not be subject to federal
income tax on any net investment income and any net capital gains to the
extent they are distributed or are deemed to have been distributed to
shareholders. Distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to the deferral of wash sale losses, and
paydowns on certain mortgage-backed securities. As a result, net investment
income (loss) and net realized gain (loss) on investment transactions for a
reporting period may differ significantly from distributions during such
period. Accordingly, the Funds may periodically make reclassifications among
certain of their capital accounts without impacting the net asset value of
the Funds.
22
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
D. Forward Commitments
Each Fund may purchase or sell securities on a "when issued" or delayed
delivery or on a forward commitment basis. The Funds use forward commitments
to manage interest rate exposure or as a temporary substitute for purchasing
or selling particular debt securities. Forward commitments are not used for
purposes of trading. Settlement for securities purchased on a forward
commitment basis can take place a month or more after the date of the
transaction. The Fund generally does not take delivery on these forward
commitments, but such commitments are instead settled with offsetting
transactions. When a forward commitment contract is closed, the Funds record
a realized gain or loss. Forward commitments involve a risk of loss if the
value of the security to be purchased declines prior to the settlement date.
The Funds could also be exposed to loss if they can not close out their
forward commitments because of an illiquid secondary market, or the
inability of counterparties to perform. The Fund monitors exposure to ensure
counterparties are credit worthy and concentration of exposure is minimized.
The Funds instruct the custodian to segregate liquid high quality assets in
a separate account with a current market value at least equal to the amount
of its forward purchase commitments. The price of the underlying security
and the date when the securities will be delivered and paid for are fixed at
the time the transaction is negotiated. The value of the forward commitment
is determined by management using a commonly accepted pricing model and
fluctuates based upon changes in the value of the underlying security and
market repo rates. Such rates equate the counterparty's cost to purchase and
finance the underlying security to the earnings received on the security and
forward delivery proceeds. The Funds record on a daily basis the unrealized
appreciation/depreciation based upon changes in the value of the forward
commitment. At December 31, 1995, the cost (value) of forward commitments to
purchase securities amounted to $53,105,836 ($54,494,208) for the MML Blend
Fund.
E. ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
3. CAPITAL LOSS CARRYFORWARD
The accumulated net realized loss on investments for the MML Money Market Fund
results in a capital loss carryforward of $9,734 which is available for federal
income tax purposes to offset future capital gains. Of the total carryforward,
$485 expires December 31, 1997, $1,639 expires December 31, 1998, $1,204 expires
December 31, 2000, $201 expires December 31, 2001, $5,364 expires December 31,
2002 and $841 expires December 31, 2003.
The accumulated net realized loss on investments for the MML Managed Bond Fund
results in a capital loss carryforward of $840,829 which is available for
federal income tax purposes to offset future capital gains. This carryforward
expires December 31, 2002.
4. INVESTMENT MANAGEMENT FEE
MassMutual provides all investment advisory, management and administrative
services needed by the Funds. For acting as such, MassMutual receives a
quarterly fee from each Fund at the annual rate of .50% of the first
$100,000,000 of the average daily net asset value of each Fund, .45% of the next
$200,000,000, .40% of the next $200,000,000, and .35% of any excess over
$500,000,000.
MassMutual has entered into an investment sub-advisory agreement with Concert
Capital Management, Inc. ("Concert"), a wholly-owned subsidiary of Babson
Acquisition Corporation which is a controlled subsidiary of MassMutual. The
agreement provides that Concert manage the assets of MML Equity Fund and the
assets of the Equity Sector of MML Blend Fund. MassMutual pays Concert a
quarterly fee equal to an annual rate of .13% of the average daily net asset
value of MML Equity Fund and the Equity Sector of MML Blend Fund.
MassMutual has agreed, at least through April 30, 1997, to bear the expenses of
the Funds to the extent that the aggregate expenses (excluding each Fund's
management fee, interest, taxes, brokerage commissions and extraordinary
expenses) incurred during each Fund's fiscal year exceed .11% of the average
daily net asset value of each Fund for such year. For the year ended December
31, 1995, MassMutual was not required to reimburse the Funds for any expenses.
23
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
5. PURCHASES AND SALES OF INVESTMENTS AND FORWARD COMMITMENTS
<TABLE>
<CAPTION>
Proceeds
For the Year Ended Acquisition from Sales
December 31, 1995 Cost and Maturities
------------------ -------------- --------------
<S> <C> <C>
Investments
-----------
MML EQUITY FUND
Equities....................................... $ 229,128,687 $ 111,920,115
Short-term investments......................... 1,173,976,609 1,111,406,690
MML MONEY MARKET FUND
Short-term investments......................... 655,453,234 644,100,630
MML MANAGED BOND FUND
Bonds and notes................................ 49,417,797 31,634,617
U.S. Government investments - long term........ 66,464,380 60,934,135
Short-term investments......................... 535,089,316 540,413,398
MML BLEND FUND
Equities....................................... 117,991,665 171,211,503
Bonds and notes................................ 55,930,726 27,095,542
U.S. Government investments - long term........ 176,774,268 197,430,879
Short-term investments......................... 2,401,405,335 2,275,579,310
Cost
Forward Commitments of Contracts
------------------- -------------
MML MANAGED BOND FUND
U.S. Treasury and GNMA Forward
Commitment Contracts:
Contracts opened............................. $ 14,301,523
Contracts closed............................. 21,317,004
Outstanding at December 31, 1995........... --
MML BLEND FUND
U.S. Treasury and GNMA Forward
Commitment Contracts:
Contracts opened............................. 218,072,828
Contracts closed............................. 224,132,699
Outstanding at December 31, 1995........... 53,105,836
</TABLE>
6. NET INCREASE FROM CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
MML MML
MML Money Managed MML
For the Year Ended Equity Market Bond Blend
December 31, 1995 Fund Fund Fund Fund
------------------ ----------- ---------- ----------- ------------
<S> <C> <C> <C> <C>
Shares
Reinvestment of dividends.... 1,621,795 5,376,748 763,489 5,184,192
Sales of shares.............. 8,464,024 92,327,266 2,219,273 6,885,480
Redemptions of shares........ (1,909,273) (80,569,846) (1,113,390) (4,944,135)
------------- ------------ ------------ -------------
Net increase................. 8,176,546 17,134,168 1,869,372 7,125,537
============= ============ ============ =============
Amount
Reinvestment of dividends....$ 33,282,252 $ 5,376,748 $ 8,979,443 $ 96,495,329
Sales of shares.............. 203,078,940 92,327,266 26,776,179 135,128,246
135,128,246
Redemptions of shares........ (45,862,370) (80,569,846) (13,296,001) (96,681,499)
------------- ------------ ------------ -------------
Net increase.................$ 190,498,822 $ 17,134,168 $ 22,459,621 $ 134,942,076
============= ============ ============ =============
<CAPTION>
MML Money Managed MML
For the Year Ended Equity Market Bond Blend
December 31, 1994 Fund Fund Fund Fund
------------------ ----------- ---------- ----------- ------------
Shares
Reinvestment of dividends 1,956,594 2,918,570 930,847 5,115,478
Sales of shares 7,668,310 63,560,555 1,691,878 9,445,934
Redemptions of shares (1,955,939) (48,352,100) (2,151,153) (3,664,257)
------------- ------------ ------------ -------------
Net increase 7,668,965 18,127,025 471,572 10,897,155
============= ============ ============ =============
Amount
Reinvestment of dividends $ 40,128,959 $ 2,918,570 $ 11,006,790 $ 92,494,374
Sales of shares 159,968,984 63,560,555 19,994,563 171,986,353
Redemptions of shares (40,585,464) (48,352,100) (25,360,820) (66,659,536)
------------- ------------ ------------ -------------
Net increase $159,512,479 $ 18,127,025 $ 5,640,533 $ 197,821,191
============= ============ ============ =============
</TABLE>
24
<PAGE>
Report Of Independent Accountants
To the Board of Trustees and Shareholders of
MML Series Investment Fund
We have audited the accompanying statement of assets and liabilities of each of
the Funds which comprise the MML Series Investment Fund (a Massachusetts
business trust), including the schedules of investments, as of December 31,
1995, and the related statement of operations for the year then ended, the
statement of changes in net assets for each of the two years in the period then
ended, and the financial highlights for each of the ten years in the period then
ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1995 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the Funds as of December 31, 1995, the results of their respective operations
for the year then ended, the changes in their respective net assets for each of
the two years in the period then ended, and the financial highlights for each of
the ten years in the period then ended, in conformity with generally accepted
accounting principles.
Coopers & Lybrand L.L.P.
Springfield, Massachusetts
February 2, 1996
25
