Merrill Lynch
Ready Assets Trust
FUND LOGO
Semi-Annual Report June 30, 1994
Officers and Trustees
Arthur Zeikel--President and Trustee
Donald Cecil--Trustee
M. Colyer Crum--Trustee
Edward H. Meyer--Trustee
Charles H. Ross, Jr.--Trustee
Jack B. Sunderland--Trustee
J. Thomas Touchton--Trustee
Terry K. Glenn--Executive Vice President
Joseph T. Monagle, Jr.--Executive Vice President
Donald C. Burke--Vice President
John Ng--Vice President
Gerald M. Richard--Treasurer
Mark B. Goldfus--Secretary
Custodian
The Bank of New York
1 Wall Street
New York, New York 10286
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 221-7210
<PAGE>
This report is not authorized for use as an
offer of sale or a solicitation of an offer to
buy shares of the Trust unless accompanied or
preceded by the Trust's current prospectus.
Past performance results shown in this report
should not be considered a representation of
future performance, which will fluctuate. The
Trust seeks to maintain a consistent $1.00 net
asset value per share, although this cannot be
assured. An investment in the Trust is neither
insured nor guaranteed by the US Government.
Merrill Lynch
Ready Assets Trust
Box 9011
Princeton, NJ 08543-9011
Merrill Lynch Ready Assets Trust
Dear Shareholder:
For the six-month period ended June 30, 1994, the Trust paid
shareholders a net annualized yield of 3.07%*. The Trust's 7-day
yield as of June 30, 1994 was 3.67% (excluding gains and losses)
and 3.67% (including gains and losses).
The Environment
A sharp change in investor sentiment occurred during the six-
month period ended June 30, 1994. Following a series of better-
than-expected economic results, the Federal Reserve Board began
to pursue a less accommodative monetary policy, raising short-
term interest rates a total of four times from February through
June month-end. The expectation of increasing inflationary
pressures and higher interest rates initially heightened investor
concerns and increased financial market volatility during the
period. However, as the period drew to a close, it was the
weakness of the US dollar in foreign exchange markets that
dominated the financial news and prolonged stock and bond market
declines.
<PAGE>
The US dollar's weakness relative to other major currencies
reflects the deteriorating US trade deficit and widening net
long-term capital outflows. In 1993, an expanding US economy and
recession in other industrial countries led to a higher level of
imports and weaker export growth, widening the US trade deficit
further. In addition, global investors favored non-US dollar
denominated assets throughout 1993, which has further depressed
the dollar's value. This trend is not improving significantly
thus far in 1994 since foreign inflows into US capital markets
continue to decline, although US investors are investing outside
of the United States to a lesser degree.
[FN]
*Based on a constant investment throughout the period, with
dividends compounded daily, and reflecting a net return to the
investor after all expenses.
Over the longer term, if the economies of the United States'
major trading partners expand (improving the prospects for US
export growth), the outlook for the US dollar is likely to
improve. In the near term, central banks have attempted to
reverse the dollar's decline through currency market
intervention. These efforts have met with limited success thus
far, giving rise to the concern that the Federal Reserve Board
will be forced to continue to raise short-term interest rates to
attract investment capital back to the United States and bolster
the dollar's value. However, further interest rate increases may
jeopardize the US economic expansion. In the weeks ahead,
investors will continue to assess economic data and inflationary
trends as they focus on the US dollar in order to gauge whether
further increases in short-term interest rates are imminent.
Portfolio Matters
For the six months ended June 30, 1994, Merrill Lynch Ready
Assets Trust's investment outlook became progressively less
optimistic, as reflected in our average portfolio maturity which
peaked at a high of 83 days early in the period and subsequently
declined to a low of 41 days. Since the end of 1993, interest
rates have risen on the heels of continued economic expansion and
modest inflation. During this time, the Federal Reserve Board has
taken an aggressive role in the marketplace by raising the
Federal Funds rate four times to its current level of 4.25% and
the discount rate to its present level of 3.50%.
<PAGE>
Since our last shareholder report, the Trust adopted a more
defensive approach to the market. As the June period opened, a
weighting of one-year US Treasury bills and short-term commercial
paper gave the Trust an opportunity to barbell its investments
effectively against comparable six-month money market securities
at a spread of 10 basis points--12 basis points (0.10%--0.12%).
By mid-January, the average portfolio maturity peaked at 83 days.
However, as the month proceeded and our concerns over the
stability of interest rates heightened, we actively sought to
reduce market exposure. By month-end, the Trust's average port-
folio maturity was reduced to the mid 70-day range.
During the opening days of February, we aggressively reduced the
Trust's exposure to interest rates by paring the average
portfolio maturity to the low 60-day area. On February 4, the
Federal Reserve Board tightened monetary policy by hiking its
Federal Funds rate target by 25 basis points to 3.25%, reversing
a trend that had dominated the marketplace since 1989. For the
remainder of the month, we largely limited new purchases to the
overnight market for both liquidity purposes and in anticipation
of another round of Federal Reserve Board tightening. By month-
end, the average portfolio maturity stood at 50 days, reflective
of our defensive posture.
As we entered March, the Trust continued its cautious approach to
the market, expecting another round of tightening from the
central bank. Accordingly, new purchases were limited to the very
front end of the investment spectrum. As a further hedge against
rising interest rates, we selectively added to positions in our
three-month Treasury bill-based variable rate securities. On
March 22, citing inflationary fears, the Federal Reserve Board
again raised interest rates by 25 basis points, thereby placing
the benchmark Federal Funds rate at 3.50%. At this point, it was
our decision to commit modestly to 90-day money market
securities. By the end of March, the Trust's average portfolio
maturity stood at 44 days.
During the month of April, the Trust's overall investment
approach remained defensive as we were concerned that the
market's anticipation would prompt the Federal Reserve Board to
tighten again. By the end of April, the Trust's average maturity
again stood at 44 days. Additionally, the Trust modestly
increased its positions in variable rate products from 27% of
total assets to 29% over the same time frame.
<PAGE>
On the heels of a strong employment report, the Trust maintained
an average life in the low 40-day range throughout the early part
of May. However, after the Federal Reserve Board's decisive
tightening on May 17, we elected to increase the Trust's exposure
to interest rates modestly by pushing the average life into the
50-day area. Importantly, we were heartened by the Federal
Reserve Board's press release suggesting that its actions of 1994
had substantially reversed the monetary accommodations of 1993.
Accordingly, we established positions in six-month Government
agency securities at similar yields to those available on high-
quality commercial paper. Additionally, given our view that the
central bank could now afford to hold policy steady for a time,
we established sizable portions in three-month commercial paper,
where quality spreads were the most attractive. By the end of
May, the Trust's average maturity stood at 56 days.
Market forces were favorable for the early days of June. Job
growth for May appeared to moderate while inflation seemed
subdued. As a result, we continued our cautiously optimistic
strategy by maintaining the Trust's average maturity in the mid
to high 50-day range. As we entered the latter part of June, and
in response to the deterioration of the US dollar and the implied
inflationary ramifications, the fixed-income market's tone turned
negative. Accordingly, the Trust reduced its exposure to interest
rates by selling off some of its longer-dated agencies. Further-
more, new purchases were limited to maturities of 30 days and
less. By the end of June, the Trust's average life stood at
50 days.
Currently, the Trust's average portfolio maturity stands at 41
days. Recent employment statistics suggest that the economy
remains strong. Domestic interest rates continue to rise as the
value of the dollar continues to falter against major currencies.
We will continue to remain conservative in our commitment to the
market until the Federal Reserve Board takes a clearer position
on its monetary policy.
<PAGE>
The portfolio's composition at the end of the June period and as
of our last report is detailed below:
6/30/94 12/31/93
------- --------
Bankers' Acceptances--Yankee* 0.8% --
Bank Notes 0.4 1.3%
Certificates of Deposit 0.4 --
Certificates of Deposit--European -- 1.5
Certificates of Deposit--Yankee* -- 1.4
Commercial Paper 51.3 39.3
Corporate Notes 0.1 0.2
Master Notes 7.3 5.6
Medium-Term Notes -- 1.5
Repurchase Agreements 1.6 3.7
Taxable Municipal Bonds -- 0.3
US Government, Agency &
Instrumentality--Discount 13.5 21.6
US Government, Agency &
Instrumentality--Non-Discount 25.1 24.5
Other Assets (Liabilities)--Net (0.5) (0.9)
------- --------
Total 100.0% 100.0%
======= ========
[FN]
*US branches of foreign banks.
In Conclusion
We thank you for your support of Merrill Lynch Ready Assets
Trust, and we look forward to serving your investment needs in
the months and years ahead.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(John Ng)
John Ng
Vice President and Portfolio Manager
July 11, 1994
<PAGE>
Merrill Lynch Ready Assets Trust
Schedule of Investments as of June 30, 1994 (in Thousands)
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
Bank Notes--0.4%
NationsBank $ 25,000 3.625 % 11/30/94 $ 24,850
Texas, N.A.
Total Bank Notes
(Cost--$24,996) 24,850
Bankers' Acceptances--Yankee--0.8%
Bayerische 51,000 3.89 7/07/94 50,996
Landesbank Girozentrale
Total Bankers' Acceptances-- Yankee
(Cost--$51,000) 50,996
Certificates of Deposit--0.4%
American Express 25,000 3.97 7/05/94 24,999
Centurion Bank
Total Certificates of Deposit
(Cost--$24,999) 24,999
Commercial Paper--Discount--51.3%
ANZ Delaware Inc. 25,000 4.43 9/07/94 24,777
5,000 4.445 9/07/94 4,955
20,000 4.53 10/20/94 19,708
APRECO, Inc. 10,400 4.35 7/01/94 10,399
Allomon Funding Corp. 9,050 4.31 7/28/94 9,020
American Express 67,055 4.13 7/01/94 67,048
Credit Corp. 150,000 4.25 7/08/94 149,858
65,000 4.30 7/25/94 64,806
B.A.T. Capital Corp. 13,900 4.30 7/20/94 13,867
7,000 4.30 7/26/94 6,978
<PAGE>
Bankers Trust NY 50,000 3.959 7/20/94 49,881
Corp. 59,165 4.50 9/01/94 58,684
Bear Stearns 10,000 4.35 7/06/94 9,993
Companies, Inc. (The) 30,000 4.50 8/26/94 29,788
50,000 4.47 9/16/94 49,496
Bowater PLC 15,000 4.45 8/22/94 14,901
5,000 4.50 8/26/94 4,965
17,000 4.45 9/14/94 16,833
15,000 4.45 9/20/94 14,841
CIT Group 25,000 4.38 7/05/94 24,985
Holdings, Inc. (The) 50,000 4.45 8/22/94 49,671
25,000 4.45 8/23/94 24,832
60,000 4.49 8/25/94 59,583
70,000 4.47 8/30/94 69,460
40,000 4.45 9/08/94 39,638
CS First Boston, Inc. 15,000 3.937 7/06/94 14,989
25,000 4.30 7/25/94 24,925
CXC Incorporated 20,000 4.43 9/12/94 19,809
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
Commercial Paper--Discount (continued)
Cargill Incorporated $ 75,000 4.35 % 7/01/94 $ 74,991
Central & 11,800 4.40 8/04/94 11,750
SouthWest Corp.
Ciesco L.P. 26,200 3.906 7/08/94 26,176
40,000 4.27 7/08/94 39,962
35,000 3.907 7/11/94 34,955
35,000 3.909 7/14/94 34,942
30,000 3.957 7/15/94 29,947
57,100 4.30 7/18/94 56,977
23,000 3.959 7/19/94 22,948
Coles Myer Finance 8,400 3.908 7/12/94 8,388
(USA) Ltd.
Commonwealth Bank 50,000 3.96 7/22/94 49,869
of Australia
<PAGE>
Corporate 13,600 3.908 7/13/94 13,579
Receivables Corp. 25,000 3.959 7/18/94 24,946
31,100 4.45 9/12/94 30,803
Creditanstalt 50,000 4.50 9/06/94 49,561
Finance, Inc.
Daimler-Benz North 39,000 4.30 7/19/94 38,911
American Corp.
Dow Jones & 9,481 4.75 7/01/94 9,480
Company, Inc.
ESC Securitization Inc. 25,000 4.45 8/24/94 24,829
Falcon Asset 10,200 4.32 7/21/94 10,174
Securitization Corp.
Ford Motor Credit 75,000 4.25 7/05/94 74,956
Company 75,000 4.25 7/06/94 74,947
65,000 4.48 8/29/94 64,516
General Electric 8,000 3.82 7/06/94 7,994
Capital Corp. 7,525 4.45 7/07/94 7,518
25,000 3.97 8/19/94 24,845
Generale Bank Inc. 55,000 4.47 9/19/94 54,425
Goldman Sachs 20,000 4.50 9/06/94 19,824
Group, L.P.
Halifax Building 25,000 3.969 7/19/94 24,943
Society
Hanson Finance 25,000 3.969 7/18/94 24,946
(UK) PLC 16,500 4.42 9/07/94 16,353
63,000 4.42 9/09/94 62,422
48,000 4.45 9/12/94 47,541
44,000 4.45 9/15/94 43,562
Hertz Funding 8,000 3.907 7/11/94 7,990
Corporation 12,000 4.45 8/29/94 11,911
<PAGE>
Merrill Lynch Ready Assets Trust
Schedule of Investments as of June 30, 1994 (continued)
(in Thousands)
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
Commercial Paper--Discount (continued)
Household Finance $ 50,000 4.45 % 9/13/94 $ 49,516
Corporation
International Lease 25,000 4.40 8/03/94 24,894
Finance Corp. 20,000 4.45 9/13/94 19,806
Kredietbank North 18,000 3.989 7/18/94 17,961
American Finance 7,000 4.50 9/06/94 6,939
Corp.
Leeds Permanent 50,000 3.29 7/21/94 49,875
Building Society
MCA Funding 6,500 4.52 10/04/94 6,419
Corporation 18,000 4.52 10/06/94 17,770
McKenna Triangle 25,000 4.45 9/19/94 24,738
National Corporation
Morgan Stanley 138,000 4.40 7/01/94 137,983
Group, Inc.
New Center Asset 50,000 4.30 7/05/94 49,970
Trust 100,000 4.34 7/22/94 99,735
30,000 4.45 9/06/94 29,737
36,500 4.45 9/13/94 36,146
Nomura Holding 25,000 4.30 7/26/94 24,922
America Inc.
PHH Corporation 20,000 4.30 7/22/94 19,947
50,000 4.50 8/31/94 49,608
Panasonic Finance, 4,000 4.43 9/08/94 3,964
Inc.
Preferred Receivables 16,000 4.35 7/07/94 15,986
Funding Corp.
<PAGE>
Premium Funding Inc., 10,068 4.40 8/08/94 10,020
Series A 10,068 4.40 8/09/94 10,019
Sheffield Receivables 19,000 3.918 7/12/94 18,973
Corp. 30,000 3.959 7/18/94 29,936
17,000 4.30 7/19/94 16,961
15,000 4.30 7/21/94 14,962
Siemens Corp. 5,000 3.959 7/19/94 4,989
Student Loan Corp. 20,000 4.47 9/20/94 19,788
Svenska 50,000 4.42 9/09/94 49,541
Handelsbanken, Inc. 24,850 4.44 9/09/94 24,622
7,000 4.45 9/14/94 6,931
18,000 4.54 9/26/94 17,795
Toshiba America, Inc. 20,000 4.44 8/19/94 19,876
Transamerica Finance 70,000 4.50 9/06/94 69,385
Corporation
Wal-Mart Stores, Inc. 66,400 4.30 7/05/94 66,360
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
Commercial Paper--Discount (concluded)
Western Australia $ 42,000 3.958 % 7/18/94 $ 41,910
Treasury Corp.
Xerox Credit 70,000 3.955 7/07/94 69,942
Corporation 16,500 3.966 7/12/94 16,477
Total Commercial Paper--Discount
(Cost--$3,305,502) 3,304,974
Corporate Notes--0.1%
Associates Corp. of 5,000 6.625 12/01/94 5,037
North America
Shell Oil Company 5,000 6.125 11/15/94 5,028
Total Corporate Notes
(Cost--$10,104) 10,065
<PAGE>
Master Notes--7.3%
Goldman Sachs 150,000 4.38 9/01/94 150,000
Group, L.P.++
Kingdom of Sweden 320,000 4.312 7/15/94 320,000
Total Master Notes
(Cost--$470,000) 470,000
US Government, Agency & Instrumentality
Obligations--Discount--13.5%
Federal Farm Credit 8,000 3.50 12/08/94 7,830
Bank
Federal Home 59,000 4.046 9/01/94 58,540
Loan Bank 23,000 4.218 10/11/94 22,699
50,000 3.50 12/02/94 48,980
Federal National 25,000 3.848 7/18/94 24,949
Mortgage Association 20,000 3.41 9/19/94 19,800
25,000 3.43 9/19/94 24,750
100,000 4.37 9/19/94 98,999
50,000 3.42 9/20/94 49,493
17,000 3.42 9/26/94 16,815
50,000 3.42 9/30/94 49,431
25,000 4.185 10/04/94 24,695
50,000 4.204 10/04/94 49,389
20,000 3.45 10/13/94 19,733
100,800 3.44 10/14/94 99,441
125,000 3.45 10/18/94 123,251
US Treasury Bills 25,000 3.46 12/15/94 24,460
25,000 3.465 12/15/94 24,460
56,500 3.48 12/15/94 55,279
25,000 3.41 2/09/95 24,250
Total US Government, Agency &
Instrumentality Obligations--Discount
(Cost--$869,774) 867,244
<PAGE>
Merrill Lynch Ready Assets Trust
Schedule of Investments as of June 30, 1994 (concluded)
(in Thousands)
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
US Government, Agency & Instrumentality
Obligations--Non-Discount--25.1%
Federal Home $ 23,000 4.40 % 4/27/95 $ 22,964
Loan Bank++ 44,000 4.68 6/21/95 44,000
79,000 4.56 8/09/95 78,281
75,000 4.68 12/28/95 75,000
73,000 4.71 6/17/96 73,000
29,000 4.71 6/21/96 29,000
Federal Home Loan 50,000 4.34 9/16/94 49,518
Mortgage Corporation++ 136,000 4.372 1/06/95 135,975
79,000 4.53 8/09/95 78,281
56,000 4.61 9/01/95 55,987
39,000 4.62 9/01/95 38,996
16,000 4.58 5/06/96 16,000
15,000 4.75 5/13/98 15,000
Federal National 45,000 4.19 7/08/94 44,999
Mortgage Association++ 86,000 4.29 6/01/95 85,992
30,000 4.65 12/20/95 30,000
95,000 4.58 5/13/96 95,000
70,000 4.58 5/24/96 70,000
70,000 4.70 5/19/97 70,000
65,000 4.75 5/14/98 65,000
Student Loan 7,500 4.81 8/22/94 7,501
Marketing 30,000 4.61 9/09/94 29,997
Association++ 30,000 4.24 10/13/94 30,000
23,000 4.61 12/30/94 23,000
10,000 4.91 3/23/95 10,010
<PAGE>
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
US Government, Agency & Instrumentality
Obligations--Non-Discount (concluded)
Student Loan $ 10,000 4.89 % 4/24/95 $ 10,008
Marketing 80,750 4.66 8/07/95 80,750
Association++ 43,500 4.66 3/20/96 43,493
(concluded) 5,000 4.49 5/15/96 5,003
60,000 4.67 1/14/97 60,000
US Treasury Notes 62,000 4.25 8/31/94 61,981
80,000 3.875 2/28/95 79,300
Total US Government, Agency &
Instrumentality Obligations--Non-Discount
(Cost--$1,616,399) 1,614,036
Repurchase Agreements**--1.6%
Face
Amount Issue
$120,589 Fuji Securities, Inc., purchased on 6/30/94
to yield 4.35% to 7/01/94 100,000
Total Repurchase Agreements
(Cost--$100,000) 100,000
Total Investments
(Cost--$6,472,774)--100.5% 6,467,164
Liabilities in Excess of Other Assets--(0.5%) (31,336)
----------
Net Assets--100.0% $6,435,828
==========
[FN]
*Commercial Paper and certain US Government, Agency & Instrumentality
Obligations are traded on a discount basis; the interest rates shown
are the discount rates paid at the time of purchase by the Trust. Other
securities bear interest at the rates shown, payable at fixed shown
dates or upon maturity. Interest rates on variable rate securities
are adjusted periodically based upon appropriate indexes. Interest
rates shown are the rates in effect at June 30, 1994.
**Repurchase Agreements are fully collateralized by the US Government
Obligations.
++Variable Rate Notes.
See Notes to Financial Statements.
<PAGE>
<TABLE>
Merrill Lynch Ready Assets Trust
Statement of Assets and Liabilities as of June 30, 1994
<S> <C> <C>
Assets:
Investments, at value (identified cost--$6,472,774,005*)(Note 1a) $ 6,467,164,454
Cash 283,322
Receivables:
Interest $ 12,913,485
Beneficial interest sold 2,377,902 15,291,387
------------
Prepaid registration fees and other assets (Note 1d) 79,404
---------------
Total assets 6,482,818,567
---------------
Liabilities:
Payables:
Beneficial interest redeemed 41,868,734
Investment adviser (Note 2) 1,925,768
Distributor (Note 2) 1,540,523 45,335,025
------------
Accrued expenses and other liabilities 1,655,132
---------------
Total liabilities 46,990,157
---------------
Net Assets $ 6,435,828,410
===============
Net Assets Consist of:
Shares of beneficial interest, $.10 par value, unlimited number of shares authorized $ 644,143,785
Paid-in capital in excess of par 5,797,294,176
Unrealized depreciation on investments--net (5,609,551)
---------------
Net Assets--Equivalent to $1.00 per share based on 6,441,437,961 shares of beneficial
interest outstanding $ 6,435,828,410
===============
<FN>
*Cost for Federal income tax purposes. As of June 30, 1994, net unrealized
depreciation for Federal income tax purposes amounted to $5,609,551, of which
$4,628 related to appreciated securities and $5,614,179 related to depreciated
securities.
</TABLE>
<PAGE>
<TABLE>
Merrill Lynch Ready Assets Trust
Statement of Operations for the Six Months Ended June 30, 1994
<S> <C> <C>
Investment Income (Note 1c):
Interest and premium and discount earned $ 122,569,859
Expenses:
Investment advisory fees (Note 2) $ 11,846,157
Transfer agent fees (Note 2) 5,149,641
Distribution fees (Note 2) 3,879,282
Registration fees (Note 1d) 139,750
Accounting services (Note 2) 125,500
Custodian fees 117,032
Printing and shareholder reports 100,574
Trustees' fees and expenses 70,564
Professional fees 54,931
Other 53,536
---------------
Total expenses 21,536,967
---------------
Investment income--net 101,032,892
Realized Gain on Investments--Net (Note 1c) 272,857
Change in Unrealized Depreciation on Investments--Net (6,104,185)
---------------
Net Increase in Net Assets Resulting from Operations $ 95,201,564
===============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
For the Six For the Year
Merrill Lynch Ready Assets Trust Months Ended Ended
Statements of Changes in Net Assets June 30, 1994 Dec. 31, 1993
Increase (Decrease) in Net Assets:
<S> <C> <C>
Operations:
Investment income--net $ 101,032,892 $ 197,862,626
Realized gain on investments--net 272,857 3,578,640
Change in unrealized depreciation on investments--net (6,104,185) (1,103,997)
--------------- ---------------
Net increase in net assets resulting from operations 95,201,564 200,337,269
--------------- ---------------
Dividends & Distributions to Shareholders (Note 1e):
Investment income--net (101,032,892) (197,862,626)
Realized gain on investments--net (272,857) (3,578,640)
--------------- ---------------
Net decrease in net assets resulting from dividends and distributions to shareholders (101,305,749) (201,441,266)
--------------- ---------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares 6,293,341,964 14,756,129,434
Net asset value of shares issued to shareholders in reinvestment of dividends and
distributions (Note 1e) 100,920,478 200,674,784
--------------- ---------------
6,394,262,442 14,956,804,218
Cost of shares redeemed (6,475,516,827) (15,898,382,152)
--------------- ---------------
Net decrease in net assets derived from beneficial interest transactions (81,254,385) (941,577,934)
--------------- ---------------
Net Assets:
Total decrease in net assets (87,358,570) (942,681,931)
Beginning of period 6,523,186,980 7,465,868,911
--------------- ---------------
End of period $ 6,435,828,410 $ 6,523,186,980
=============== ===============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
For the Six
Merrill Lynch Ready Assets Trust Months Ended For the Year Ended December 31,
Financial Highlights June 30, 1994 1993 1992 1991 1990
The following per share data and ratios have
been derived from information provided in the
financial statements.
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ----------- ----------- -----------
Investment income--net .0152 .0272 .0332 .0556 .0771
Realized and unrealized gain on
investments--net (.0009) .0003 .0009 .0029 .0010
----------- ----------- ----------- ----------- -----------
Total from investment operations .0143 .0275 .0341 .0585 .0781
----------- ----------- ----------- ----------- -----------
Less dividends and distributions:
Investment income--net (.0152) (.0272) (.0332) (.0556) (.0771)
Realized gain on investments--net -- (.0005) (.0007) (.0029)++ (.0010)++
----------- ----------- ----------- ----------- -----------
Total dividends and distributions (.0152) (.0277) (.0339) (.0585) (.0781)
----------- ----------- ----------- ----------- -----------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== =========== ===========
Total Investment Return 3.07%* 2.81% 3.44% 6.02% 8.08%
=========== =========== =========== =========== ===========
Ratios to Average Net Assets:
Expenses, excluding distribution fees .53%* .53% .52% .50% .50%
=========== =========== =========== =========== ===========
Expenses .65%* .65% .64% .62% .62%
=========== =========== =========== =========== ===========
Investment income--net and realized gain on
investments--net 3.07%* 2.78% 3.48% 5.87%++ 7.80%++
=========== =========== =========== =========== ===========
Supplemental Data:
Net assets, end of period (in thousands) $ 6,435,828 $ 6,523,187 $ 7,465,869 $ 9,077,226 $10,180,436
=========== =========== =========== =========== ===========
<FN>
*Annualized.
++Includes unrealized gain (loss).
See Notes to Financial Statements.
</TABLE>
<PAGE>
Merrill Lynch Ready Assets Trust
Notes to Financial Statements
1. Significant Accounting Policies:
Merrill Lynch Ready Assets Trust (the "Trust") is registered
under the Investment Company Act of 1940 as a diversified, open-
end management investment company. The following is a summary of
significant accounting policies followed by the Trust.
(a) Valuation of investments--Investments maturing more than
sixty days after the valuation date are valued at the most recent
bid price or yield equivalent as obtained from dealers that make
markets in such securities. When such securities are valued with
sixty days or less to maturity, the difference between the
valuation existing on the sixty-first day before maturity and
maturity value is amortized on a straight-line basis to maturity.
Investments maturing within sixty days from their date of
acquisition are valued at amortized cost, which approximates
market value. For purposes of valuation, the maturity of a
variable rate security is deemed to be the next coupon date on
which the interest rate is to be adjusted. Assets for which
market quotations are not readily available are valued at fair
value as determined in good faith by or under the direction of
the Board of Trustees.
(b) Income taxes--It is the Trust's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable income
to its shareholders. Therefore, no Federal income tax provision
is required.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are
entered into (the trade dates). Interest income (including
amortization of discount) is recognized on the accrual basis.
Realized gains and losses on security transactions are determined
on the identified cost basis.
(d) Prepaid registration fees--Prepaid registration fees are
charged to expense as the related shares are issued.
(e) Dividends to shareholders--The Trust declares dividends
daily and reinvests daily such dividends (net of non-resident
alien tax and back-up withholding tax) in additional shares of
beneficial interest at net asset value. Dividends are declared
from the total of net investment income and net realized gain or
loss on investments.
<PAGE>
2. Investment Advisory Agreement and Transactions with
Affiliates:
The Trust has entered into an Investment Advisory Agreement with
Merrill Lynch Asset Management, L.P. Effective January 1, 1994,
the investment advisory business of MLAM was reorganized from a
corporation to a limited partnership. Both prior to and after the
reorganization, ultimate control of MLAM was vested with Merrill
Lynch & Co. ("ML & Co."). The general partner of MLAM is
Princeton Services, Inc., an indirect wholly-owned subsidiary of
ML & Co. The limited partners are ML & Co. and Merrill Lynch
Investment Management, Inc. ("MLIM"), which is an indirect
wholly-owned subsidiary of ML & Co. The Trust has also entered
into a Distribution Agreement and a Distribution Plan with
Merrill Lynch Funds Distributor, Inc. ("MLFD" or "Distributor"),
a wholly-owned subsidiary of MLIM. MLAM provides the Trust with
investment management, research, statistical, and advisory
services, and pays certain other expenses of the Trust. For such
services, the Trust pays a monthly fee based upon the average
daily value of the Trust's net assets at the following annual
rates:
Notes to Financial Statements
(concluded)
Portion of average daily value of net assets: Rate
Not exceeding $500 million 0.500%
In excess of $500 million but not exceeding $1 billion 0.400
In excess of $1 billion but not exceeding $5 billion 0.350
In excess of $5 billion but not exceeding $10 billion 0.325
In excess of $10 billion but not exceeding $15 billion 0.300
In excess of $15 billion but not exceeding $20 billion 0.275
In excess of $20 billion 0.250
The most restrictive annual expense limitation requires that the
Adviser reimburse the Trust to the extent the Trust's expenses
(excluding interest, taxes, distribution fees, brokerage fees and
commissions, and extraordinary items) exceed 2.5% of the Trust's
first $30 million of average daily net assets, 2.0% of the next
$70 million of average daily net assets, and 1.5% of the average
daily net assets in excess thereof. The obligation of the manager
to reimburse the Trust under this limitation is not limited to
the amount of the management fee.
<PAGE>
The Trust has adopted a Shareholder Servicing Plan and Agreement
in accordance with Rule 12b-1 under the Investment Company Act of
1940, pursuant to which Merrill Lynch, Pierce, Fenner and Smith
Inc. ("MLPF&S"), a wholly-owned subsidiary of ML & Co., receives
a fee each month from the Trust at the annual rate of 0.125% of
average daily net assets of the accounts of Trust shareholders
who maintain their Trust accounts through MLPF&S. This fee is to
compensate MLPF&S financial consultants and other directly
involved branch office personnel for providing direct personal
services to shareholders. The fee is not compensation for
administrative services.
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary
of ML & Co., is the Trust's transfer agent.
Accounting services are provided to the Trust by MLAM at cost.
Certain officers and/or trustees of the Trust are officers and/or
directors of MLIM, FDS, MLFD, MLPF&S, and/or ML & Co.
3. Shares of Beneficial Interest:
The number of shares purchased and redeemed during the six months
ended June 30, 1994 and the year ended December 31, 1993,
corresponds to the amounts included in the Statements of Changes
in Net Assets for net proceeds from sale of shares and cost of
shares redeemed, respectively, since shares are recorded at $1.00
per share.
