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Description of art work on front cover of Prospectus
Two thin blue vertical lines on right side of page.
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PROSPECTUS
MAY 1, 1995, AS REVISED SEPTEMBER 22, 1995
WRIGHT TRUE BLUE CHIP
EQUITY INVESTMENT FUNDS
<PAGE>
P R O S P E C T U S MAY 1, 1995, AS REVISED SEPTEMBER 22, 1995
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THE WRIGHT TRUE BLUE CHIP EQUITY MANAGED INVESTMENT FUNDS
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THE WRIGHT MANAGED EQUITY TRUST
A mutual fund consisting of four series (three of which are covered by this
Prospectus), or Funds, seeking long-term growth of capital and reasonable
current income.
WRIGHT QUALITY CORE EQUITIES FUND
WRIGHT SELECTED BLUE CHIP EQUITIES FUND
WRIGHT JUNIOR BLUE CHIP EQUITIES FUND
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Write To: THE WRIGHT MANAGED INVESTMENT FUNDS, BOS 725, BOX 1559,
BOSTON, MA 02104
Or Call: THE FUND ORDER ROOM -- (800) 225-6265
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This combined Prospectus is designed to provide you with information you should
know before investing. Please retain this document for future reference.
A combined Statement of Additional Information dated May 1, 1995, as revised
September 22,1995, for the Funds has been filed with the Securities and Exchange
Commission and is incorporated herein by reference. This Statement is available
without charge from Wright Investors' Service Distributors, Inc., 1000 Lafayette
Boulevard, Bridgeport, Connecticut 06604 (800-888-9471).
SHARES OF THE FUNDS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR ENDORSED OR
GUARANTEED BY ANY BANK OR OTHER INSURED DEPOSITORY INSTITUTION, AND ARE NOT
FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD OR ANY OTHER GOVERNMENT AGENCY. SHARES OF THE FUNDS INVOLVE
INVESTMENT RISKS, INCLUDING FLUCTUATIONS IN VALUE AND THE POSSIBLE LOSS OF SOME
OR ALL OF THE PRINCIPAL INVESTMENT.
TABLE OF CONTENTS
PAGE
An Introduction to the Funds...................... 2
Shareholder and Fund Expenses..................... 4
Financial Highlights.............................. 5
Performance and Yield Information................. 8
The Funds and their Investment Objectives
and Policies...................................... 8
Wright Quality Core Equities Fund (WQC)......... 8
Wright Selected Blue Chip Equities Fund (WBC)... 9
Wright Junior Blue Chip Equities Fund (WJBC).... 9
Other Investment Policies......................... 10
Special Investment Considerations................. 10
The Investment Adviser............................ 11
The Administrator................................. 13
Distribution Expenses............................. 13
How the Funds Value their Shares.................. 14
How to Buy Shares................................. 14
How Shareholder Accounts are Maintained........... 16
Distributions by the Funds........................ 16
Taxes............................................. 16
How to Exchange Shares............................ 18
How to Redeem or Sell Shares...................... 18
Other Information................................. 20
Tax-Sheltered Retirement Plans.................... 20
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
AN INTRODUCTION TO THE FUNDS
THE INFORMATION SUMMARIZED BELOW IS QUALIFIED IN ITS ENTIRETY BY THE MORE
DETAILED INFORMATION SET FORTH IN THIS PROSPECTUS.
The Trust...........................The Wright Managed Equity Trust (the
"Trust" or the "Equity Trust") is an
open-end management investment company
known as a mutual fund,is registered under
the Investment Company Act of 1940, as
amended (the "1940 Act") and consists of
four series (the "Funds") (including
one series that is being offered under a
separate prospectus). Each Fund is a
diversified fund and represents a separate
and distinct series of the Trust's shares of
beneficial interest.
Investment Objectives...............Each Fund seeks long-term growth of capital
and reasonable current income by investing
in securities selected from The Approved
Wright Investment List ("AWIL") prepared by
Wright Investors' Service, the Fund's
investment adviser. Only those companies
meeting or exceeding Wright's 32 fundamental
standards of investment quality are
eligible for inclusion on the AWIL.
The Funds...........................Wright Quality Core Equities Fund ("WQC")
selects AWIL companies (as defined above)
with a superior investment outlook.
Wright Selected Blue Chip Equities Fund
("WBC") invests in selected WQC companies,
regardless of size, whose current operations
have been identified as being likely to
provide comparatively superior total
investment return over the intermediate
term.
Wright Junior Blue Chip Equities Fund
("WJBC") invests in smaller WQC companies
with a superior investment outlook.
The Investment Adviser..............Each Fund has engaged Wright Investors'
Service of Bridgeport, Connecticut
("Wright" or the "Investment Adviser")
as investment adviser to carry out the
investment and reinvestment of the
Fund's assets.
The Administrator...................Each Fund also has retained Eaton Vance
Management ("Eaton Vance" or the
"Administrator"), 24 Federal Street, Boston,
MA 02110 as administrator to manage the
Fund's legal and business affairs.
The Distributor.....................Wright Investors' Service Distributors, Inc.
is the Distributor of the Fund's shares and
receives a distribution fee equal on an
annual basis to 2/10 of 1% of each Fund's
average daily net assets.
<PAGE>
How to Purchase Fund Shares........There is no sales charge on the purchase
of shares of any Fund. Shares of any Fund
may be purchased at the net asset value per
share next determined after receipt and
acceptance of the purchase order.The minimum
initial investment is $1,000 per Fund which
may be waived for investments in 401(k)
tax-sheltered retirement plans.There is no
minimum amount for subsequent purchases. The
$1,000 minimum initial investment is waived
for Bank Draft Investing accounts which may
be established with an investment of $50
or more with a minimum of $50 applicable to
each subsequent investment. Shares also may
be purchased through an exchange of
securities. See "How to Buy Shares."
Distribution Options ...............Distributions are paid in additional
shares at net asset value or cash as the
shareholder elects. Unless the shareholder
has elected to receive dividends and
distributions in cash, dividends and
distributions will be reinvested in
additional shares of the Funds at net asset
value per share as of the ex-dividend date.
Redemptions.........................Shares may be redeemed directly from a Fund
at the net asset value per share next
determined after receipt of the redemption
request in good order. See "How to Redeem or
Sell Fund Shares."
Exchange Privilege..................Shares of the Funds may be
exchanged for shares of another Fund and
certain other investment companies for which
Wright acts as investment adviser at the net
asset value next determined after receipt of
the exchange request in good order. There
may be limits on the number and frequency of
exchanges. See "How to Exchange Shares."
Net Asset Value.....................Net asset value per share of each Fund is
calculated on each day the New York Stock
Exchange is open for trading.
Taxation ...........................Each Fund has elected to be treated, has
qualified and intends to continue to qualify
each year as a regulated investment company
under Subchapter M of the Internal Revenue
Code and, consequently, should not be liable
for federal income tax on net investment
income and net realized capital gains that
are distributed to shareholders in
accordance with applicable timing
requirements.
Shareholder Communications......... Each shareholder will receive
annual and semi-annual reports containing
financial statements, and a statement
confirming each share transaction.Financial
statements included in annual reports are
audited by the Trust's independent certified
public accountants. Where possible,
shareholder confirmations and account
statements will consolidate all Wright
investment fund holdings of the shareholder.
THE PROSPECTUSES OF THE FUNDS ARE COMBINED IN THIS PROSPECTUS. EACH FUND OFFERS
ONLY ITS OWN SHARES, YET IT IS POSSIBLE THAT A FUND MIGHT BECOME LIABLE FOR A
MISSTATEMENT IN THE PROSPECTUS OF ANOTHER FUND. THE TRUSTEES OF THE TRUST HAVE
CONSIDERED THIS IN APPROVING THE USE OF A COMBINED PROSPECTUS.
<PAGE>
SHAREHOLDER AND FUND EXPENSES
The following table of fees and expenses is provided to assist investors in
understanding the various costs and expenses which may be borne directly or
indirectly by an investment in each Fund. The percentages shown below
representing total operating expenses are based on actual amounts incurred for
the fiscal year ended December 31, 1994.
<TABLE>
<CAPTION>
Wright Wright Wright
Selected Blue Chip Junior Blue Chip Quality Core
Equities Fund (WBC) Equities Fund (WJBC) Equities Fund (WQC)
-------------------- --------------------- --------------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES none none none
ANNUALIZED FUND OPERATING EXPENSES
(as a percentage of average net assets)
Investment Adviser Fee 0.62% 0.55% 0.45%
Rule 12b-1 Distribution Expense 0.20% 0.20% 0.20%
Other Expenses (including administration fees)[1] 0.21% 0.36% 0.34%
----- ----- -----
TOTAL OPERATING EXPENSES 1.03% 1.11% 0.99%
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<FN>
[1] Administration fees for WJBC and WQC were 0.20% and for WBC 0.13%.
</FN>
</TABLE>
EXAMPLE OF FUND EXPENSES
The following is an illustration of the total transaction and operating expenses
that an investor in each Fund would bear over different periods of time,
assuming an investment of $1,000, a 5% annual return on the investment and
redemption at the end of each period:
<TABLE>
<CAPTION>
Wright Wright Wright
Selected Blue Chip Junior Blue Chip Quality Core
Equities Fund (WBC) Equities Fund (WJBC) Equities Fund (WQC)
-------------------- --------------------- --------------------
<S> <C> <C> <C>
1 Year $ 11 $ 11 $ 10
3 Years 33 35 32
5 Years 57 61 55
10 Years 126 135 121
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</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF ACTUAL PAST EXPENSES
OR FUTURE EXPENSES. ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN
DEPENDING UPON A VARIETY OF FACTORS INCLUDING THE ACTUAL PERFORMANCE OF EACH
FUND. Moreover, while the Example assumes a 5% annual return, a Fund's actual
performance will vary and may result in actual returns greater or less than 5%.
The Fund's payment of a distribution fee may result in a long-term shareholder
indirectly paying more than the economic equivalent of the maximum initial sales
charge permitted under the Rules of Fair Practice of the National Association of
Securities Dealers, Inc.
<PAGE>
FINANCIAL HIGHLIGHTS
The following information should be read in conjunction with the audited
financial statements included in the Statement of Additional Information, all of
which have been so included in reliance upon the report of Deloitte & Touche
LLP, independent certified public accountants, as experts in accounting and
auditing, which report is contained in the Fund's Statement of Additional
Information. Further information regarding the performance of each Fund is
contained in the Funds' annual report to shareholders which may be obtained
without charge by contacting the Funds' Principal Underwriter, Wright Investors'
Service Distributors, Inc. at 800-888-9471.
<TABLE>
<CAPTION>
THE WRIGHT MANAGED EQUITY TRUST WRIGHT SELECTED BLUE CHIP EQUITIES FUND -- Year Ended December 31,
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
-------------------- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
Net asset value, beginning of year. $14.920 $14.790 $17.180 $13.840 $15.370 $13.760 $12.120 $14.040 $13.490 $10.990
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Income from Investment Operations:
Net investment income............ $0.233 $0.196 $0.222 $0.267 $0.323 $0.368 $0.315 $0.292 $0.287 $0.393
Net realized and unrealized gain
(loss) on investments............ (0.763) 0.104 0.498 4.553 (0.843) 2.922 2.250 (0.557) 1.553 2.527
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total income (loss) from investment
operations.................... $(0.530) $0.300 $0.720 $4.820 $(0.520) $3.290 $2.565 $(0.265) $1.840 $2.920
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Less Distributions:
From net investment income....... $(0.180) $(0.170) $(0.200) $(0.250) $(0.320) $(0.310) $(0.275) $(0.340) $(0.310) $(0.420)
From net realized gain on
investments (0.360) -- (2.910) (1.230) (0.690) (1.370) (0.650) (1.315) (0.980) --
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions.............. $(0.540) $0.170) $(3.110) $(1.480) $(1.010) $(1.680) $(0.925) $(1.655) $(1.290) $(0.420)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of year....... $13.850 $14.920 $14.790 $17.180 $13.840 $15.370 $13.760 $12.120 $14.040 $13.490
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return....................... (3.52%) 2.06% 4.71% 35.98% (3.30%) 24.57% 21.31% (1.83%) 14.18% 27.25%
Ratios/Supplemental Data
Net assets, end of year
(000 omitted).................... $186,016 $175,481 $152,997 $167,900 $108,571 $120,345 $114,042 $ 99,200 $ 92,908$ 65,232
Ratio of expenses to average
net assets....................... 1.03% 1.03% 1.02% 1.08% 1.12% 1.11% 1.10% 1.03% 0.98% 0.87%
Ratio of net investment income to
average net assets.............. 1.57% 1.28% 1.34% 1.67% 2.28% 2.38% 2.29% 1.92% 1.96% 3.21%
Portfolio Turnover Rate 72% 28% 77% 72% 83% 20% 29% 30% 40% 80%
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE WRIGHT MANAGED EQUITY TRUST WRIGHT JUNIOR BLUE CHIP EQUITIES FUND -- Year Ended December 31,
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
-------------------- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
Net asset value, beginning of year. $11.950 $11.690 $14.720 $11.500 $13.020 $12.450 $11.030 $12.730 $12.380 $10.000
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Income from Investment Operations:
Net investment income............ $0.101 $0.101 $0.045 $0.072 $0.111 $0.177 $0.197 $0.131 $0.149 $0.209
Net realized and unrealized gain
(loss) on investments........... (0.431) 0.809 0.315 4.118 (1.491) 1.723 1.478 (0.671) 0.541 2.331
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total income (loss) from investment
operations.................... $(0.330) $0.910 $0.360 $4.190 $(1.380) $1.900 $ 1.675 $(0.540) $0.690 $2.540
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Less Distributions:
From net investment income....... $(0.100) $(0.060) $(0.030) $(0.070) $(0.140) $(0.150) $(0.175) $(0.150) $(0.160)$(0.160)
From net realized gain on
investments..................... (0.520) (0.590) (3.360) (0.900) -- (1.180) (0.080) (1.010) (0.180) --
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions.............. $(0.620) $(0.650) $(3.390) $(0.970) $(0.140) $(1.330) $(0.255) $(1.160) $(0.340) $(0.160)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of year....... $11.000 $11.950 $11.690 $14.720 $11.500 $13.020 $12.450 $11.030 $12.730 $12.380
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return....................... (2.75%) 7.93% 3.28% 36.98% (10.61%) 15.61% 15.21% (3.58%) 5.62% 25.61%**
Ratios/Supplemental Data
Net assets, end of year
(000 omitted)................... $ 37,124 $68,226 $64,635 $120,911 $63,385 $98,593 $121,644 $95,808 $74,113 $30,132
Ratio of expenses to average
net assets 1.11% 1.09% 1.07% 1.10% 1.14% 1.10% 1.08% 1.03% 1.05% 0.90%**
Ratio of net investment income to
average net assets.............. 0.91% 0.86% 0.31% 0.52% 0.95% 1.34% 1.61% 0.96% 1.11% 1.74%**
Portfolio Turnover Rate............ 36% 38% 80% 60% 75% 15% 38% 58% 20% 26%
* Portfolio commenced operations on January 14, 1985; ** Computed on an
annualized basis.
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THE WRIGHT MANAGED EQUITY TRUST WRIGHT QUALITY CORE EQUITIES FUND -- Year Ended December 31,
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FINANCIAL HIGHLIGHTS 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985*
-------------------- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
Net asset value, beginning of year. $12.720 $13.380 $14.730 $10.760 $11.290 $10.590 $9.710 $12.810 $11.300 $10.000
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Income from Investment Operations:
Net investment income............ $0.180 $0.176 $0.179 $0.175 $0.192 $0.207 $0.211 $0.233 $0.232 $0.111
Net realized and unrealized gain
(loss) on investments........... (0.295) (0.046) 0.951 3.985 (0.522) 2.163 1.394 (0.303) 1.658 1.229
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total income (loss) from investment
operations.................... $(0.115) $0.130 $1.130 $4.160 $(0.330) $2.370 $1.605 $(0.070) $1.890 $1.340
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Less Distributions:
From net investment income....... $(0.160) $(0.160) $(0.160) $(0.190) $(0.200) $(0.220) $(0.185) $(0.265) $(0.240) $(0.040)
From net realized gain on
investments..................... (1.055) (0.625) (2.320) -- -- (1.450) (0.540) (2.765) (0.140) --
In excess of net realized gains.. -- (0.005) -- -- -- -- -- -- -- --
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions.............. $(1.215) $(0.790) $(2.480) $(0.190) $(0.200) $(1.670) $(0.725) $(3.030) $(0.380) $(0.040)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of year....... $11.390 $12.720 $13.380 $14.730 $10.760 $11.290 $10.590 $9.710 $12.810 $11.300
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return....................... (0.73%) 1.00% 8.02% 38.90% (2.89%) 23.02% 16.66% 1.01% 16.90% 13.46%**
Ratios/Supplemental Data
Net assets, end of year
(000 omitted)..................... $51,085 $88,349 $81,674 $80,065 $44,293 $50,193 $60,989 $60,579 $81,939 $27,446
Ratio of expenses to average
net assets...................... 0.99% 0.97% 1.01% 1.03% 1.07% 1.14% 1.06% 0.96% 1.03% 0.90%**
Ratio of net investment income to
average net assets.............. 1.46% 1.37% 1.20% 1.34% 1.80% 1.76% 1.97% 1.61% 1.79% 2.61%**
Portfolio Turnover Rate............ 55% 53% 70% 9% 18% 12% 14% 34% 17% 9%
* Portfolio commenced operations on August 7, 1985; ** Computed on an annualized
basis.
</TABLE>
<PAGE>
NOTES:
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WRIGHT SELECTED BLUE CHIP EQUITIES FUND
During each of the years ended December 31, 1987 and 1986, the operating
expenses of the Fund were reduced either by a reduction of the investment
adviser fee, administration fee, distribution fee, or through the allocation of
expenses to the Adviser, or a combination of these. Had such actions not been
undertaken, the net investment income per share and the ratios would have been
as follows:
<TABLE>
<CAPTION>
Year Ended December 31,
---------------------------------
<S> <C> <C>
WRIGHT SELECTED BLUE CHIP EQUITIES FUND 1987 1986
--------------------------------------- ---- ----
Net investment income per share............................... $ 0.279 $ 0.278
======= =======
Ratios (As a percentage of average net assets):
Expenses................................................. 1.09% 1.02%
======= =======
Net investment income.................................... 1.86% 1.92%
======= =======
</TABLE>
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WRIGHT JUNIOR BLUE CHIP EQUITIES FUND (INCEPTION DATE JANUARY 14, 1985)
During the year ended December 31, 1985, the Principal Underwriter reduced the
distribution expenses incurred by it for the benefit of Wright Junior Blue Chip
Equities Fund (WJBC). In addition, during the year ended December 31, 1987, the
Administrator reduced its fee. Had such actions not been undertaken, the net
investment income per share and the ratios would have been as follows:
<TABLE>
<CAPTION>
Year Ended December 31,
---------------------------------
<S> <C> <C>
WRIGHT JUNIOR BLUE CHIP EQUITIES FUND 1987 1985*
------------------------------------- ---- -----
Net investment income per share............................... $ 0.118 $ 0.207
======= =======
Ratios (As a percentage of average net assets):
Expenses................................................. 1.08% 0.92%**
======= =======
Net investment income.................................... 0.91% 1.72%**
======= =======
* Portfolio commenced operations on January 14, 1985; ** Computed on an annualized basis.
</TABLE>
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WRIGHT QUALITY CORE EQUITIES FUND (INCEPTION DATE AUGUST 7, 1985)
The Principal Underwriter made a reduction of its fees during the year ended
December 31, 1990. During each of the years ended December 31, 1985, 1987, 1988
and 1989, the operating expenses of the Fund were reduced either by a reduction
of the investment adviser fee, administrator fee, distribution fee, or a
reduction of a combination of these fees. Had such actions not been undertaken,
the net investment income per share and the annualized ratios would have been as
follows:
<TABLE>
<CAPTION>
Year Ended December 31,
-------------------------------------------
<S> <C> <C> <C> <C> <C>
WRIGHT QUALITY CORE EQUITIES FUND 1990 1989 1988 1987 1985*
--------------------------------- ---- ---- ---- ---- -----
Net investment income per share............. $0.183 $0.206 $0.208 $0.222 $0.104
======= ======= ======= ======= =======
Ratios (As a percentage of average net assets):
Expenses................................. 1.15% 1.15% 1.08% 1.00% 1.07%**
======= ======= ======= ======= =======
Net investment income.................... 1.72% 1.75% 1.95% 1.57% 2.44%**
======= ======= ======= ======= =======
* Period from August 7, 1985 (commencement of operations) to December 31, 1985;
** Computed on an annualized basis.
</TABLE>
<PAGE>
PERFORMANCE AND YIELD INFORMATION
From time to time, a Fund may publish its yield and/or total return in
advertisements and communications to shareholders. The current yield for a Fund
will be calculated by dividing the net investment income per share during a
recent 30-day period by the maximum offering price (net asset value) per share
of a Fund on the last day of the period. A Fund's total return is determined by
computing the annual percentage change in value of $1,000 invested at the
maximum public offering price (net asset value) for specified periods ending
with the most recent calendar quarter, assuming reinvestment of all
distributions. Investors should note that the investment results of a Fund will
fluctuate over time, and any presentation of a Fund's current yield or total
return for any prior period should not be considered as a representation of what
an investment may earn or what an investor's yield or total return may be in any
future period.
THE FUNDS AND THEIR
INVESTMENT OBJECTIVES AND POLICIES
The objective of each Fund is to provide long-term growth of capital and at the
same time earn reasonable current income. Securities selected for each Fund are
drawn from an investment list prepared by Wright and known as The Approved
Wright Investment List (the "AWIL").
APPROVED WRIGHT INVESTMENT LIST (AWIL). Wright systematically reviews about
3,000 U.S. companies in its proprietary database in order to identify those
which, on the basis of at least five years of audited records, pass the minimum
standards of prudence (e.g. the value of its assets and shareholders' equity
exceeds certain minimum standards and the company's operations have been
profitable during the last three years) and thus are suitable for consideration
by fiduciary investors. Companies which meet these requirements (about 1,600
companies) are considered by Wright to be of "investment grade." They may be
large or small, may have their securities traded on exchanges or over the
counter, and may include companies not currently paying dividends on their
shares.
These companies are then subjected to extensive analysis and evaluation in order
to identify those which meet Wright's 32 fundamental standards of investment
quality. Only those companies which meet or exceed all of these standards are
eligible for selection by the Wright Investment Committee for inclusion in The
Approved Wright Investment List. See the Statement of Additional Information for
a more detailed description of Wright Quality Ratings and the AWIL.
All companies on the AWIL are, in the opinion of Wright, soundly financed "True
Blue Chips" with established records of earnings profitability and equity
growth. All have established investment acceptance and active, liquid markets
for their publicly owned shares. The AWIL will normally be made up of 250 to 300
companies.
The investment objective and, unless otherwise indicated, policies of each Fund
may be changed by the Trustees of the Trust without a vote of the Fund's
shareholders. Any such change of the investment objective of a Fund will be
preceded by thirty days advance notice to each shareholder of such Fund. If any
changes were made, a Fund might have investment objectives different from the
objectives which an investor considered appropriate at the time the investor
became a shareholder in such Fund. There is no assurance that the Trust or any
of the Funds will achieve its investment objective. The market price of
securities held by the Funds and the net asset value of each Fund's shares will
fluctuate in response to stock market developments.
WRIGHT QUALITY CORE EQUITIES FUND (WQC). This Fund seeks to enhance total
investment return (consisting of price appreciation plus income) by providing
management of a broadly diversified portfolio of equity securities of
well-established companies meeting strict quality standards. The Fund will,
through continuous professional investment supervision by Wright, pursue these
objectives by investing in a diversified portfolio of common stocks of what are
believed to be high-quality, well-established and profitable companies.
The Fund will, under normal market conditions, invest at least 80% of its net
assets in equity securities, including common stocks, preferred stocks and
securities convertible
<PAGE>
into stock. However, for temporary defensive purposes the Fund may hold cash or
invest more than 20% of its net assets in the short-term debt securities
described under "Special Investment Considerations -- Defensive Investments."
This Fund is quality oriented and is suitable for a total equity account or as a
base portfolio for accounts with multiple objectives. Investments, except for
temporary defensive investments, will be made solely in companies on the AWIL.
In selecting companies from the AWIL for this portfolio, the Investment
Committee of Wright Investors' Service selects, based on quantitative formulae,
those companies which are expected to do better over the intermediate term. The
quantitative formulae take into consideration factors such as over/under
valuation and compatibility with current market trends. Investments in the
portfolio are equally weighted in the selected securities.
The disciplines which determine sale include preventing individual holdings from
exceeding 2 1/2 times their normal value position in this Fund and requiring the
sale of the securities of any company which no longer meets the standards of the
AWIL. Also, portfolio holdings which fall in the unfavorable category based on
the quantitative formulae described above are generally sold. The disciplines
which determine purchase provide that new funds, income from securities
currently held, and proceeds of sales of securities will be used to increase
those positions which at current market are the furthest below their normal
target values and to purchase companies which become eligible for the portfolio
as described above.
WRIGHT SELECTED BLUE CHIP EQUITIES FUND (WBC). This Fund seeks to enhance the
total investment return (consisting of price appreciation plus income) by
providing active management of equity securities of well-established companies
meeting strict quality standards. Equity securities are limited to those
companies whose current operations reflect defined, quantified characteristics
which have been identified by Wright as being likely to provide comparatively
superior total investment return. The process selects approximately two-thirds
of the WQC companies on the basis of Wright's evaluation of their outlook.
Investments are equally weighted.
The disciplines which determine sale include preventing individual holdings from
exceeding 2 1/2 times their normal value position in this Fund, preventing the
retention of the securities of any company which no longer meets the standards
of the AWIL, and portfolio holdings which cease to meet the outlook criteria
described above. The disciplines which determine purchase provide that new
funds, income from securities currently held, and proceeds of sales of
securities will be used to increase those positions which at current market
values are the furthest below their normal target values and to purchase
companies which become eligible for the portfolio.
The Fund will, under normal market conditions, invest at least 80% of its net
assets in Selected Blue Chip equity securities, including common stocks,
preferred stocks and securities convertible into stock. However, for temporary
defensive purposes the Fund may hold cash or invest more than 20% of its net
assets in the short-term debt securities described under "Special Investment
Considerations -- Defensive Investments."
WRIGHT JUNIOR BLUE CHIP EQUITIES FUND (WJBC). This Fund seeks to enhance the
total investment return (consisting of price appreciation plus income) by
providing management of equity securities of smaller companies still
experiencing their rapid growth period. Equity securities selected are limited
to those companies selected for the WQC Fund which when sorted by stock market
capitalization represent the smaller companies on the list. Investments are
equally weighted.
The Fund will, under normal market conditions, invest at least 80% of its net
assets in Junior Blue Chip equity securities, including common stocks, preferred
stocks and securities convertible into stock. However, for temporary defensive
purposes the Fund may hold cash or invest more than 20% of its net assets in the
short-term debt securities described under "Special Investment Considerations --
Defensive Investments."
Somewhat higher volatility of market pricing and greater variability of
individual stock investment returns can be expected in this Fund as compared to
either the Wright Quality Core Equities Fund or the Wright Selected Blue Chip
Equities Fund, which invest in larger companies.
<PAGE>
OTHER INVESTMENT POLICIES
The Trust has adopted certain fundamental investment restrictions which are
enumerated in detail in the Statement of Additional Information and which may be
changed as to a Fund only by the vote of a majority of such Fund's outstanding
voting securities. Among other restrictions, each Fund may not borrow money in
excess of 1/3 of the current market value of such Fund's net assets (excluding
the amount borrowed), invest more than 5% of the Fund's total assets taken at
current market value in the securities of any one issuer, purchase more than 10%
of the voting securities of any one issuer or invest 25% or more of the Fund's
total assets in the securities of issuers in the same industry. There is,
however, no limitation in respect to investments in obligations issued or
guaranteed by the U.S. Government or its agencies or instrumentalities. None of
the Funds has any current intention of borrowing for leverage or speculative
purposes.
None of the Funds is intended to be a complete investment program, and the
prospective investor should take into account his objectives and other
investments when considering the purchase of any Fund's shares. The Funds cannot
eliminate risk or assure achievement of their objectives.
SPECIAL INVESTMENT CONSIDERATIONS
REPURCHASE AGREEMENTS. Each of the Funds may enter into repurchase agreements to
the extent permitted by its investment policies in order to earn income on
temporarily uninvested cash. A repurchase agreement is an agreement under which
the seller of securities agrees to repurchase and the Fund agrees to resell the
securities at a specified time and price. A Fund may enter into repurchase
agreements only with large, well-capitalized banks or government securities
dealers that meet Wright credit standards. In addition, such repurchase
agreements will provide that the value of the collateral underlying the
repurchase agreement will always be at least equal to the repurchase price,
including any accrued interest earned under the repurchase agreement. In the
event of a default or bankruptcy by a seller under a repurchase agreement, the
Fund will seek to liquidate such collateral. However, the exercise of the right
to liquidate such collateral could involve certain costs, delays and
restrictions and is not ultimately assured. To the extent that proceeds from any
sale upon a default of the obligation to repurchase are less than the repurchase
price, the Fund could suffer a loss.
DEFENSIVE INVESTMENTS. During periods of unusual market conditions, when Wright
believes that investing for temporary defensive purposes is appropriate, all or
a portion of each Fund's assets may be held in cash or invested in short-term
obligations, including but not limited to short-term obligations issued or
guaranteed as to interest and principal by the U.S. Government or any agency or
instrumentality thereof (including repurchase agreements collateralized by such
securities); commercial paper which at the date of investment is rated A-1 by
Standard & Poor's Ratings Group ("Standard & Poor's") or P-1 by Moody's
Investors Service, Inc. ("Moody's"), or, if not rated by such rating
organizations, is deemed by the Trustees to be of comparable quality; short-term
corporate obligations and other debt instruments which at the date of investment
are rated AA or better by Standard & Poor's or Aa or better by Moody's or, if
unrated by such rating organizations, are deemed by the Trustees to be of
comparable quality; and certificates of deposit, bankers' acceptances and time
deposits of domestic banks which are determined to be of high quality by the
Trustees. The Funds may invest in instruments and obligations of banks that have
other relationships with the Funds, Wright, Eaton Vance or Investors Bank &
Trust Company, an affiliate of Eaton Vance. No preference will be shown towards
investing in banks which have such relationships.
LENDING PORTFOLIO SECURITIES. Each Fund may seek to increase its total return by
lending portfolio securities to broker-dealers or other institutional borrowers.
Under present regulatory policies of the Securities and Exchange Commission,
such loans are required to be continuously secured by collateral in cash,
cash-equivalents and U.S. Government securities held by the Fund's custodian and
maintained on a current basis at an amount at least equal to the market value of
the securities loaned, which will be marked to market daily. During the
existence of a loan, a Fund will continue to receive the equivalent of the
interest or dividends paid by the issuer on the securities loaned and will also
receive a fee, or all or a portion of the interest, if any, on investment of the
collateral. However, the Fund may at
<PAGE>
the same time pay a transaction fee to such borrowers. As with other extensions
of credit there are risks of delay in recovery or even loss of rights in the
securities loaned if the borrower of the securities fails financially. However,
the loans will be made only to organizations deemed by the Investment
Adviser to be of good standing and when, in the judgment of the Investment
Adviser, the consideration which can be earned from securities loans of this
type justifies the attendant risk. The financial condition of the borrower will
be monitored by the Investment Adviser on an ongoing basis and collateral
values will be continuously maintained at no less than 100% by "marking to
market" daily. If the Investment Adviser decides to make securities loans,
it is intended that the value of the securities loaned would not exceed 30% of
the Fund's total assets.
THE INVESTMENT ADVISER
Each Fund has engaged Wright Investors' Service ("Wright"), 1000 Lafayette
Boulevard, Bridgeport, Connecticut, to act as its investment adviser pursuant to
an Investment Advisory Contract. Under the general supervision of the Trustees
of the Trust, Wright furnishes the Funds with investment advice and management
services. The Trustees of the Trust are responsible for the general oversight of
the conduct of the Funds' business.
Wright is a leading independent international investment management and advisory
firm with more than 30 years' experience. Its staff of over 175 people includes
a highly respected team of 70 economists, investment experts and research
analysts. Wright manages assets for bank trust departments, corporations,
unions, municipalities, eleemosynary institutions, professional associations,
institutional investors, fiduciary organizations, family trusts and individuals
as well as mutual funds. Wright operates one of the world's largest and most
complete databases of financial information on 12,000 domestic and international
corporations. At the end of 1994, Wright managed approximately $4 billion of
assets.
Under Wright's Investment Advisory Contract with the Trust, Wright receives
monthly advisory fees at the annual rates (as a percentage of average daily net
assets) set forth in the following table. The table also lists each Fund's
aggregate net asset value at December 31, 1994 and the advisory fee rate paid
during the fiscal year ended December 31, 1994.
<TABLE>
Annual % Advisory Fee Rates
------------------------------------- Aggregate Fee Rate Paid
Under $100 Million to $250 Million to $500 Million to Over Net Asset Value for the Fiscal Year
$100 Million $250 Million $500 Million $1 Billion $1 Billion at 12/31/94 Ended 12/31/94
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wright Selected Blue Chip
Equities Fund (WBC) 0.55% 0.69% 0.67% 0.63% 0.58% $186,015,791 0.62%
Wright Junior Blue Chip
Equities Fund (WJBC) 0.55% 0.69% 0.67% 0.63% 0.58% $37,124,040 0.55%
Wright Quality Core
Equities Fund (WQC) 0.45% 0.59% 0.57% 0.53% 0.48% $51,084,656 0.45%
</TABLE>
The combined advisory and administration fee rates paid by the Funds (other than
the WQC Fund) are believed to be higher than those paid by most other mutual
funds. This higher fee is attributable to the specialized expertise required to
implement each Fund's investments and is comparable to the fees paid by many
other funds with similar investment objectives and policies.
Shareholders of the Funds who are also advisory clients of Wright may have
agreed to pay Wright a fee for such advisory services. Wright does not intend to
exclude from the calculation of the investment advisory fees payable to Wright
by such advisory clients the portion of the advisory fee payable to the Funds.
Accordingly, a client may pay an advisory fee to Wright in accordance with
Wright's customary investment advisory fee schedule charged to investment
advisory clients and at the same time, as a shareholder in a Fund, bear its
share of the advisory fee paid by the Fund to Wright as described above.
<PAGE>
Pursuant to the Investment Advisory Contract, Wright also furnishes for the use
of each Fund office space and all necessary office facilities, equipment and
personnel for servicing the investments of each Fund. Each Fund is responsible
for the payment of all expenses relating to its operations other than those
expressly stated to be payable by Wright under its Investment Advisory Contract.
An Investment Committee of six senior officers, all of whom are experienced
analysts, exercises disciplined direction and control over all investment
selections, policies and procedures for each Fund. The Committee, following
highly disciplined buy-and-sell rules, makes all decisions for the selection,
purchase and sale of all securities. The members of the Committee are as
follows:
JOHN WINTHROP WRIGHT, Chairman of the Investment Committee, Chairman and Chief
Executive Officer of Wright Investors' Service. AB Amherst College. Before
founding Wright Investors' Service in 1960, Mr. Wright was treasurer, St. John's
College; Commander, USNR; Executive Vice President, Standard Air Services;
President, Wright Power Saw & Tool Corp.; Senior Partner, Andris Trubee & Co.
(financial consultants); and Chairman, Rototiller, Inc. Mr. Wright has
frequently been interviewed on radio and television in the United States and
Europe and his published investment and financial writings are widely quoted.
His testimony has often been requested by various House and Senate Committees of
the Congress on matters concerning monetary policy and taxes. He participated in
the 1974 White House Financial Summit on Inflation and the 1980 Congressional
Economic Conference. He is a director of the Center for Financial Studies and a
member of the Board of Visitors of the School of Business at Fairfield
University, a fellow of the University of Bridgeport Business School and a
Trustee of the Institutes for the Development of Human Potential in
Philadelphia. He is also a member of the New York Society of Security Analysts.
JUDITH R. CORCHARD, Vice Chairman of the Investment Committee, Executive
Vice President-Investment Management of Wright Investors' Service. Ms. Corchard
attended the University of Connecticut and joined Wright Investors' in 1960. She
is a member of the New York Society of Security Analysts and the Hartford
Society of Financial Analysts.
PETER M. DONOVAN, CFA, President of Wright Investors' Service. Mr. Donovan
received a BA Economics, Goddard College and joined Wright Investors' Service
from Jones, Kreeger & Co., Washington, DC in 1966. Mr. Donovan is the president
of The Wright Managed Blue Chip Series Trust, The Wright Managed Income Trust,
The Wright Managed Equity Trust, and The Wright EquiFund Equity Trust. He is
also director of EquiFund - Wright National Equity Fund, a Luxembourg SICAV. He
is a member of the New York Society of Security Analysts and the Hartford
Society of Financial Analysts.
JATIN J. MEHTA, CFA, Executive Counselor and Director of Education of Wright
Investors' Service. Mr. Mehta received a BS Civil Engineering, University of
Bombay, India and an MBA from the University of Bridgeport. Before joining
Wright in 1969, Mr. Mehta was an executive of the Industrial Credit Investment
Corporation of India, a development bank promoted by the World Bank for
financial assistance to private industry. He is a Trustee of The Wright Managed
Blue Chip Series Trust. He is a member of the New York Society of Security
Analysts and the Hartford Society of Financial Analysts.
HARIVADAN K. KAPADIA, CFA, Senior Vice President - Investment Analysis and
Information of Wright Investors' Service. Mr. Kapadia received a BA (hon.)
Economics and Statistics and MA Economics, University of Baroda, India and an
MBA from the University of Bridgeport. Before joining Wright in 1969, Mr.
Kapadia was Assistant Lecturer at the College of Engineering and Technology in
Surat, India and Lecturer, B.J. at the College of Commerce & Economics, VVNagar,
India. He has published the textbooks: "Elements of Statistics," "Statistics,"
"Descriptive Economics," and "Elements of Economics." He was appointed Adjunct
Professor at the Graduate School of Business, Fairfield University in 1981. He
is a member of the New York Society of Security Analysts and the Hartford
Society of Financial Analysts.
MICHAEL F. FLAMENT, CFA, Senior Vice President - Investment and Economic
Analysis of Wright Investors' Service. Mr. Flament received a BS Mathematics,
Fairfield University; MA Mathematics, University of Massachusetts and an MBA
Finance, University of Bridgeport. He is a member
<PAGE>
of the New York Society of Security Analysts and the Hartford Society of
Financial Analysts.
Wright places the portfolio security transactions for each Fund, which in some
cases may be effected in block transactions which include other accounts managed
by Wright. Wright provides similar services directly for bank trust departments.
Wright seeks to execute the Funds' portfolio security transactions on the most
favorable terms and in the most effective manner possible. Subject to the
foregoing, Wright may consider sales of shares of the Funds or of other
investment companies sponsored by Wright as a factor in the selection of
broker-dealer firms to execute such transactions.
Wright is also the investment adviser to the other Funds in The Wright Managed
Equity Trust, The Wright Managed Income Trust, The Wright Managed Blue Chip
Series Trust and The Wright EquiFund Equity Trust (the "Wright Funds").
THE ADMINISTRATOR
Each Fund engages Eaton Vance as its administrator under an Administration
Agreement. Under the Administration Agreement, Eaton Vance is responsible for
managing the legal and business affairs of each Fund, subject to the supervision
of the Trust's Trustees. Eaton Vance's services include recordkeeping,
preparation and filing of documents required to comply with federal and state
securities laws, supervising the activities of each Fund's custodian and
transfer agent, providing assistance in connection with the Trustees' and
shareholders' meetings and other administrative services necessary to conduct
each Fund's business. Eaton Vance will not provide any investment management or
advisory services to the Funds. For its services under the Administration
Agreement, Eaton Vance receives monthly administration fees at the annual rates
(as a percentage of average daily net assets) set forth in the table below.
<TABLE>
<CAPTION>
Annual% Administration Fee Rates
---------------------------------
Fee Rates Fee Rate Paid
Under $100 Million to $250 Million to Over for the Fiscal Year
$100 Million $250 Million $500 Million $500 Million Ended 12/31/94
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Wright Selected Blue Chip Equities Fund (WBC) 0.20% 0.06% 0.03% 0.02% 0.13%
Wright Junior Blue Chip Equities Fund (WJBC) 0.20% 0.06% 0.03% 0.02% 0.20%
Wright Quality Core Equities Fund (WQC) 0.20% 0.06% 0.03% 0.02% 0.20%
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Eaton Vance, its affiliates and its predecessor companies have been managing
assets of individuals and institutions since 1924 and managing investment
companies since 1931. In addition to acting as the administrator of the Funds,
Eaton Vance or its affiliates act as investment adviser to investment companies
and various individual and institutional clients with assets under management of
approximately $15 billion. Eaton Vance is a wholly-owned subsidiary of Eaton
Vance Corp., a publicly held holding company. Eaton Vance Corp., through its
subsidiaries and affiliates, engages in investment management and marketing
activities, fiduciary and banking services, oil and gas operations, real estate
investment, consulting and management activities, and the development of
precious metals properties.
DISTRIBUTION EXPENSES
In addition to the fees and expenses payable by each Fund in accordance with the
Investment Advisory Contract and Administration Agreement, each Fund pays for
certain expenses pursuant to a Distribution Plan (the "Plan") adopted by the
Trust and designed to meet the requirements of Rule 12b-1 under the Investment
Company Act of 1940.
The Trust's Plan provides that monies may be spent by a Fund on any activities
primarily intended to result in the sale of the Fund's shares, including, but
not limited to,
<PAGE>
compensation paid to and expenses incurred by officers, Trustees, employees
or sales representatives of the Trust, including telephone expenses, the
printing of prospectuses and reports for other than existing shareholders,
preparation and distribution of sales literature, and advertising of any type.
The expenses covered by the Trust's Plan may include payments to any separate
distributors under agreement with the Trust for activities primarily intended
to result in the sale of the Trust's shares.
The Trust has entered into a distribution contract with Wright Investors'
Service Distributors, Inc. ("WISDI" or the "Principal Underwriter"), a wholly
owned subsidiary of Wright. Under the Plan, as amended, it is intended that each
Fund will pay 2/10 of 1% of its average daily net assets to WISDI. Subject to
the 2/10 of 1% per annum limitation imposed by the Plan, each Fund may pay
separately for expenses of any other activities primarily intended to result in
the sale of its shares.
The following table shows the distribution rate paid by each Fund for the fiscal
year ended December 31, 1994.
<TABLE>
Distribution Rate
Paid as a % of Fund's
Average Net Asset Value
-------------------------
<S> <C>
Wright Selected Blue Chip
Equities Fund (WBC) 0.20%
Wright Junior Blue Chip
Equities Fund (WJBC) 0.20%
Wright Quality Core
Equities Fund (WQC) 0.20%
</TABLE>
The Principal Underwriter may use the distribution fee for its expenses of
distributing each Fund's shares, including allocable overhead expenses. Any
distribution expenses exceeding the amounts paid by the Funds to the Principal
Underwriter were not incurred by the Principal Underwriter but were paid by
Wright from its own assets. Distribution expenses not specifically attributable
to a particular Fund are allocated among the Funds based on the amount of sales
of each Fund's shares resulting from the Principal Underwriter's distribution
efforts and expenditures. If the distribution fee exceeds the Principal
Underwriter's expenses, the Principal Underwriter may realize a profit from
these arrangements. The Trust's Plan is a compensation plan. If the Plan is
terminated, the Funds would stop paying the distribution fee and the Trustees
would consider other methods of financing the distribution of the Funds' shares.
HOW THE FUNDS VALUE THEIR SHARES
The shares of each Fund are valued once on each day the New York Stock Exchange
(the "Exchange") is open as of the close of regular trading on the Exchange -
normally 4:00 p.m. New York time. The net asset value is determined by the
Funds' custodian (as agent for the Funds) in the manner authorized by the
Trustees of the Trust. Such determination is accomplished by dividing the number
of outstanding shares of each Fund into its net worth (the excess of its assets
over its liabilities). Securities listed on securities exchanges or in the
NASDAQ National Market are valued at closing sale prices. Unlisted or listed
securities, for which closing sale prices are not available, are valued at the
mean between latest bid and asked prices. Securities for which market quotations
are unavailable, restricted securities, and other assets are valued at their
fair value as determined in good faith by or at the direction of the Trustees of
the Trust. (These valuation methods apply to debt and fixed-income as well as to
equity securities.) Short-term obligations maturing in 60 days or less are
valued at amortized cost, which approximates market value.
HOW TO BUY SHARES
Shares of each Fund are sold without a sales charge at the net asset value next
determined after the receipt of a purchase order as described below. The minimum
initial purchase of shares is $1,000 per Fund, although this may be waived for
investments in 401(k) tax-sheltered retirement plans or for Bank Draft Investing
accounts, which may be established with an investment of $50 or more. There is
no minimum amount required for subsequent purchases,
<PAGE>
except that subsequent investments for Bank Draft Investing accounts must be
at least $50. Each Fund reserves the right to reject any order for the purchase
of its shares or to limit or suspend, without prior notice, the offering of its
shares.
Shares of each Fund may be purchased or redeemed through an investment
dealer, bank or other institution. Charges may be imposed by the institution for
its services. Any such charges could constitute a material portion of a smaller
account. Shares may be purchased or redeemed directly from or with each Fund
without imposition of any charges other than those described in this Prospectus.
BY WIRE: Investors may purchase shares by transmitting immediately available
funds (Federal Funds) by wire to:
Boston Safe Deposit and Trust Company
One Boston Place
Boston, MA
ABA: 011001234
Account 081345
Further Credit: (Name of Fund)
(Include your Fund account number)
Initial purchase - Upon making an initial investment by wire, an investor must
first telephone the Order Department of the Funds at 800-225-6265 to advise of
the action and to be assigned an account number. If this telephone call is not
made, it may not be possible to process the order promptly. In addition, an
Account Instructions form, which is available through WISDI, should be promptly
forwarded to The Shareholder Services Group, Inc. (the "Transfer Agent") at the
following address:
Wright Managed Investment Funds
BOS 725
P.O. Box 1559
Boston, Massachusetts 02104
Subsequent Purchases - Additional investments may be made at any time through
the wire procedure described above. The Funds' Order Department must be
immediately advised by telephone at 800-225-6265 of each transmission of funds
by wire.
BY MAIL: Initial Purchases - The Account Instructions form available through
WISDI should be completed by an investor, signed and mailed with a check,
Federal Reserve Draft, or other negotiable bank draft, drawn on a U.S. bank and
payable in U.S. dollars, to the order of the Fund whose shares are being
purchased, as the case may be, and mailed to the Transfer Agent at the above
address.
Subsequent Purchases - Additional purchases may be made at any time by an
investor by check, Federal Reserve draft, or other negotiable bank draft, drawn
on a U.S. bank and payable in U.S. dollars, to the order of the relevant Fund at
the above address. The sub-account, if any, to which the subsequent purchase is
to be credited should be identified together with the sub-account number and,
unless otherwise agreed, the name of the sub-account.
BANK DRAFT INVESTING -- FOR REGULAR SHARE ACCUMULATION: Cash investments of
$50 or more may be made through the shareholder's checking account via bank
draft each month or quarter. The $1,000 minimum initial investment and small
account redemption policy are waived for Bank Draft Investing accounts.
PURCHASE THROUGH EXCHANGE OF SECURITIES: Investors wishing to purchase shares of
a Fund through an exchange of portfolio securities should contact WISDI to
determine the acceptability of the securities and make the proper arrangements.
The shares of a Fund may be purchased, in whole or in part, by delivering to the
Fund's custodian securities that meet the investment objectives and policies of
the Fund, have readily ascertainable market prices and quotations and which are
otherwise acceptable to the Investment Adviser and the Fund. The Trust will only
accept securities in exchange for shares of the Funds for investment purposes
and not as agent for the shareholders with a view to a resale of such
securities. The Investment
<PAGE>
Adviser will also require that securities presented
for exchange be listed on the New York Stock Exchange, American Stock Exchange
or NASDAQ. The Investment Adviser, WISDI and the Funds reserve the right to
reject all or any part of the securities offered in exchange for shares of a
Fund. An investor who wishes to make an exchange should furnish to WISDI a list
with a full and exact description of all of the securities which he proposes to
deliver. WISDI or the Investment Adviser will specify those securities which the
Fund is prepared to accept and will provide the investor with the necessary
forms to be completed and signed by the investor. The investor should then send
the securities, in proper form for transfer, with the necessary forms to the
Fund's custodian and certify that there are no legal or contractual restrictions
on the free transfer and sale of the securities. Exchanged securities will be
valued at their fair market value as of the date that the securities in proper
form for transfer and the accompanying purchase order are both received by the
Trust, using the procedures for valuing portfolio securities as described under
"How the Funds Value their Shares" on page 14. However, if the Exchange is not
open for unrestricted trading on such date, such valuation should be on the next
day on which such Exchange is so open. The net asset value used for purposes of
pricing shares sold under the exchange program will be the net asset value next
determined following the receipt of both the securities offered in exchange and
the accompanying purchase order. Securities to be exchanged must have a minimum
aggregate value of $5,000. An exchange of securities is a taxable transaction
which may result in realization of a gain or loss for Federal and state income
tax purposes.
HOW SHAREHOLDER ACCOUNTS ARE MAINTAINED
Upon the initial purchase of a Fund's shares, an account will be opened for the
account or sub-account of an investor. Subsequent investments may be made at any
time by mail to the Transfer Agent or by wire, as noted above. Distributions
paid in additional shares are credited to Fund accounts quarterly. Confirmation
statements indicating total shares of each Fund owned in the account or each
sub-account will be mailed to investors quarterly, and at the time of each
purchase or redemption. The issuance of shares will be recorded on the books of
the relevant Fund. The Trust does not issue share certificates.
DISTRIBUTIONS BY THE FUNDS
The Trust intends to pay dividends from the net investment income of each Fund
as shown on the Fund's books at least quarterly. Any net capital gains realized
from the sale of securities or other transactions in a Fund's portfolio (reduced
by any available capital loss carryforwards from prior years) will be paid at
least annually, shortly before or after the close of the Fund's fiscal year.
Shareholders may reinvest dividends and accumulate capital gains distributions,
if any, in additional shares of the same Fund at the net asset value as of the
ex-dividend date. Unless shareholders otherwise instruct, all distributions and
dividends will be automatically invested in additional shares of the same Fund.
Alternatively, shareholders may reinvest capital gains distributions and direct
that dividends be paid in cash, or that both dividends and capital gains
distributions be paid in cash.
TAXES
Each Fund is treated as a separate entity for Federal income tax purposes under
the Internal Revenue Code of 1986, as amended (the "Code"). Each Fund has
qualified and elected to be treated as a regulated investment company for
Federal income tax purposes and intends to continue to qualify as such. In order
to so qualify, each Fund must meet certain requirements with respect to sources
of income, diversification of assets, and distributions to shareholders. Each
Fund does not pay Federal income or excise taxes to the extent that it
distributes to its shareholders all of its net investment income and net
realized capital gains in accordance with the timing requirements of the Code.
In addition, each Fund will not be subject to income or corporate excise or
franchise taxes in Massachusetts as long as it qualifies as a regulated
investment company under the Code.
In order to avoid Federal excise tax, the Code requires that each Fund
distribute (or be deemed to have distributed) by December 31 of each calendar
year at least 98% of its ordinary income for such year, at least 98% of the
excess of its realized capital gains over its realized capital losses (computed
on the basis of the one-year period ending on October 31 of such year, after
reduction by any available
<PAGE>
capital loss carryforwards, for the WBC and WJBC
Funds and at the election of the WQC Fund, for the year ended December 31, after
reduction by any available capital loss carryforwards, for the WQC Fund) and
100% of any income and capital gains from the prior year (as previously
computed) that was not paid out during such year and on which the Fund paid no
Federal income tax.
Distributions of net investment income and the excess of net short-term capital
gain over net long-term capital loss are taxable to shareholders as ordinary
income, whether received in cash or reinvested in additional shares. A portion
of distributions of net investment income made by a Fund which are derived from
dividends may qualify for the dividends-received deduction for corporations. The
dividends-received deduction is reduced to the extent the shares with respect to
which the dividends are received are treated as debt-financed under the Code and
is eliminated if the shares are deemed to have been held for less than a minimum
period, generally 46 days. Receipt of distributions qualifying for the deduction
may result in liability for the alternative minimum tax and/or reduction of the
tax basis of the corporate shareholder's shares.
Distributions of the excess of each Fund's net long-term capital gain over its
net short-term capital loss are taxable as long-term capital gains whether
received in cash or reinvested in additional shares, regardless of how long the
shareholder has held the Fund shares. The dividends received deduction does not
apply to distributions of such gains. Distributions on Fund shares shortly after
their purchase, although in effect a return of a portion of the purchase price,
are generally subject to Federal income tax.
Shareholders may realize a taxable gain or loss upon a redemption or exchange of
shares of a Fund. Any loss realized upon the redemption or exchange of shares
with a tax holding period of six months or less will be treated as a long-term
capital loss to the extent of any distribution of net long-term capital gains
with respect to such shares. All or a portion of a loss realized upon a
redemption or other disposition of Fund shares may be disallowed under "wash
sale" rules if other Fund shares are purchased (whether through reinvestment of
dividends or otherwise) within the period beginning 30 days before and ending 30
days after the date of such disposition.
Each Fund follows the accounting practice known as equalization, which may
affect the amount, timing and character of distributions.
Annually, shareholders of each Fund that are not exempt from information
reporting requirements will receive information on Form 1099 to assist in
reporting the prior calendar year's distributions and redemptions (including
exchanges) on Federal and state income tax returns. Dividends declared by a Fund
in October, November or December of any calendar year to shareholders of record
as of a date in such a month and paid the following January will be treated for
Federal income tax purposes as having been received by shareholders on December
31 of the year in which they are declared.
Under Section 3406 of the Code, individuals and other nonexempt shareholders who
have not provided to a Fund their correct taxpayer identification numbers and
certain required certifications will be subject to backup withholding of 31% on
distributions made by the Funds and on proceeds of redemptions or exchanges of
shares of the Funds. In addition, the Funds may be required to impose such
backup withholding if they are notified by the IRS or a broker that the taxpayer
identification number is incorrect or that backup withholding applies because of
underreporting of interest or dividend income. If such withholding is
applicable, such distributions and proceeds will be reduced by the amount of tax
required to be withheld.
Special tax rules apply to IRA accounts (including penalties on certain
distributions and other transactions) and to other special classes of investors,
such as tax-exempt organizations, banks or insurance companies. Investors should
consult their tax advisers for more information.
Shareholders who are not United States persons should also consult their tax
advisers as to the potential application of certain U.S. taxes, including a 30%
U.S. withholding tax at the rate of 30% (or at a lower treaty rate) on dividends
representing ordinary income to them, and of foreign taxes to their investment
in the Funds.
Dividends and other distributions may, of course, also be subject to state and
local taxes. Shareholders should consult their own tax advisers with respect to
state and local tax consequences of investing in the Fund.
<PAGE>
HOW TO EXCHANGE SHARES
Shares of any Fund may be exchanged for shares of the other funds in The Wright
Managed Equity Trust, The Wright Managed Income Trust or The Wright EquiFund
Equity Trust at net asset value at the time of the exchange.
This exchange offer is available only in states where shares of such other fund
may be legally sold. Each exchange is subject to a minimum initial investment of
$1,000 in each fund.
The prospectus of each fund describes its investment objectives and policies and
shareholders should obtain a prospectus and consider these objectives and
policies carefully before requesting an exchange.
Shareholders purchasing shares from an Authorized Dealer may effect exchanges
between the above funds through their Authorized Dealer who will transmit
information regarding the requested exchanges to the Transfer Agent.
The Shareholder Services Group, Inc. makes exchanges at the next determined
net asset value after receiving a request in writing mailed to the address
provided under "How to Buy Shares."
Telephone exchanges are also accepted if the exchange involves shares valued at
less than $50,000 and on deposit with The Shareholder Services Group, Inc. and
the investor has not disclaimed in writing the use of the privilege. To effect
such exchanges, call The Shareholder Services Group, Inc. at 800-262-1122 or
within Massachusetts, 617-573-9403, Monday through Friday, 9:00 a.m. to 4:00
p.m. (Eastern Standard Time). All such telephone exchanges must be registered in
the same name(s) and with the same address and social security or other taxpayer
identification number as are registered with the fund from which the exchange is
being made. Neither the Trust, the Principal Underwriter nor The Shareholder
Services Group, Inc. will be responsible for the authenticity of exchange
instructions received by telephone, provided that reasonable procedures have
been followed to confirm that instructions communicated are genuine, and if such
procedures are not followed, the Trust, the Funds, the Principal Underwriter or
The Shareholder Services Group, Inc. may be liable for any losses due to
unauthorized or fraudulent telephone instructions. Telephone instructions will
be tape recorded. In times of drastic economic or market changes, a telephone
exchange may be difficult to implement.
Additional documentation may be required for exchange requests if shares are
registered in the name of a corporation, partnership or fiduciary. Any exchange
request may be rejected by a Fund or the Principal Underwriter at its
discretion. Contact the Transfer Agent, The Shareholder Services Group, Inc.,
for additional information concerning the Exchange Privilege. The exchange
privilege may be changed or discontinued without penalty at any time.
Shareholders will be given sixty (60) days' notice prior to any termination or
material amendment of the exchange privilege. Contact the Transfer Agent, The
Shareholder Services Group, Inc., for additional information concerning the
Exchange Privilege.
Shareholders should be aware that for Federal and state income tax purposes, an
exchange is a taxable transaction which may result in recognition of a gain or
loss.
HOW TO REDEEM OR SELL SHARES
Shares of a Fund will be redeemed at the net asset value next determined after
receipt of a redemption request in good order as described below. Proceeds will
be mailed within seven days of such receipt. However, at various times a Fund
may be requested to redeem shares for which it has not yet received good
payment. If the shares to be redeemed represent an investment made by check,
each Fund may delay payment of redemption proceeds until the check has been
collected which, depending upon the location of the issuing bank, could take up
to 15 days. For Federal and state income tax purposes, a redemption of shares is
a taxable transaction which may result in recognition of a gain or loss.
THROUGH AUTHORIZED DEALERS: Shareholders using Authorized Dealers may redeem
shares through such dealers.
BY TELEPHONE: All shareholders are automatically eligible for the telephone
redemption privilege, unless the account application indicates otherwise.
Shareholders may effect a redemption by calling the Funds' Order Department at
<PAGE>
800-225-6265 (8:30 a.m. to 4:00 p.m. Eastern time). In times when the volume of
telephone redemptions is heavy, additional phone lines will automatically be
added by the Funds. However, in times of drastic economic or market changes, a
telephone redemption may be difficult to implement. When calling to make a
telephone redemption, shareholders should have available their account number. A
telephone redemption will be made at the day's net asset value, provided that
the telephone redemption request is received prior to 4:00 p.m. on that day.
Telephone redemption requests received after 4:00 p.m. will be effected at the
net asset value determined for the next trading day. Payment will be made by
wire transfer to the bank account designated and normally, as indicated above,
within one business day after receipt of the redemption request in good order.
Trust Departments may make redemptions and deposit the proceeds in checking or
other accounts of clients, as specified in instructions furnished to the Funds
at the time of initially purchasing Fund shares. Neither the Trust, the
Principal Underwriter nor The Shareholder Services Group, Inc. will be
responsible for the authenticity of redemption instructions received by
telephone, provided that reasonable procedures have been followed to confirm
that instructions communicated are genuine, and if such procedures are not
followed, the Trust, the Funds, the Principal Underwriter or The Shareholder
Services Group, Inc. may be liable for any losses due to unauthorized or
fraudulent telephone instructions.
Also, shareholders may effect a redemption by calling the Funds' Transfer Agent,
The Shareholder Services Group, Inc., at 800-262-1122 (8:30 a.m. to 4:00 p.m.
(Eastern time) if the redemption involves shares valued at less than $50,000 and
on deposit with The Shareholder Services Group, Inc. Payment will be made by
check to the address of record. Telephone instructions will be tape recorded.
BY MAIL: A shareholder may also redeem all or any number of shares at any time
by mail by delivering the request with a stock power to the Transfer Agent, The
Shareholder Services Group, Inc., Wright Managed Investment Funds, BOS 725, P.O.
Box 1559, Boston, Massachusetts 02104. As in the case of wire requests, payments
will normally be made within one business day after receipt of the redemption
request in good order. Good order means that written redemption requests or
stock powers must be endorsed by the record owner(s) exactly as the shares are
registered and the signature(s) must be guaranteed by a member of either the
Securities Transfer Association's STAMP program or the New York Stock Exchange's
Medallion Signature Program, or certain banks, savings and loan institutions,
credit unions, securities dealers, securities exchanges, clearing agencies and
registered securities associations as required by a regulation of the Securities
and Exchange Commission and acceptable to The Shareholder Services Group, Inc.
In addition, in some cases, good order may require the furnishing of additional
documents, such as where shares are registered in the name of a corporation,
partnership or fiduciary.
The right to redeem shares of a Fund and to receive payment therefore may be
suspended at times (a) when the securities markets are closed, other than
customary weekend and holiday closings, (b) when trading is restricted for any
reason, (c) when an emergency exists as a result of which disposal by the Fund
of securities owned by it is not reasonably practicable or it is not reasonably
practicable for the Fund fairly to determine the value of its net assets, or (d)
when the Securities and Exchange Commission by order permits a suspension of the
right of redemption or a postponement of the date of payment or redemption.
Although the Funds normally intend to redeem shares in cash, each Fund, subject
to compliance with applicable regulations, reserves the right to deliver the
proceeds of redemptions in the form of portfolio securities if deemed advisable
by the Trustees. The value of any such portfolio securities distributed will be
determined in the manner described under "How the Funds Value their Shares" and
may be more or less than a shareholder's cost depending upon the market value of
portfolio securities at the time the redemption is made. If the amount of a
Fund's shares to be redeemed for a shareholder or a sub-account within a 90-day
period exceeds the lesser of $250,000 or 1% of the aggregate net asset value of
the Fund at the beginning of such period, such Fund reserves the right to
deliver all or any part of such excess in the form of portfolio securities. If
portfolio securities were distributed in lieu of cash, the shareholder would
normally incur transaction costs upon the disposition of any such securities.
<PAGE>
Due to the relatively high cost of maintaining small accounts, each Fund
reserves the right to redeem fully at net asset value any Fund account which at
any time, due to redemption or transfer, amounts to less than $1,000 for that
Fund; any shareholder who makes a partial redemption which reduces his account
in a Fund to less than $1,000 would be subject to the Fund's right to redeem
such account. However, no such redemption would be required by the Fund if the
cause of the low account balance was a reduction in the net asset value of Fund
shares. Prior to the execution of any such redemption, notice will be sent and
the shareholder will be allowed 60 days from the date of notice to make an
additional investment to meet the required minimum of $1,000 per Fund.
OTHER INFORMATION
The Trust is a business trust established under Massachusetts law and is a
no-load, open-end management investment company. The Trust was established
pursuant to a Declaration of Trust dated June 17, 1982, as amended and restated
December 21, 1987.
The Trust's shares of beneficial interest have no par value. Shares of the Trust
may be issued in two or more series or "Funds". The Trust currently has three
Funds which are offered hereby. (The Trust also has one additional series -
Wright International Blue Chip Equities Fund - that is being offered under a
separate prospectus.) Each Fund's shares may be issued in an unlimited number by
the Trustees of the Trust. Each share of a Fund represents an equal
proportionate beneficial interest in that Fund and, when issued and outstanding,
the shares are fully paid and non-assessable by the relevant Fund. Shareholders
are entitled to one vote for each full share held. Fractional shares may be
voted in proportion to the amount of the net asset value of a Fund which they
represent. Voting rights are not cumulative, which means that the holders of
more than 50% of the shares voting for the election of the Trustees of the Trust
can elect 100% of the Trustees and, in such event, the holders of the remaining
less than 50% of the shares voting on the matter will not be able to elect any
Trustees. Shares have no preemptive or conversion rights and are freely
transferable. Upon liquidation of a Fund, shareholders are entitled to share pro
rata in the net assets of the particular Fund available for distribution to
shareholders, and in any general assets of the Trust not allocated to a
particular Fund by the Trustees.
As permitted by Massachusetts law, there will normally be no meetings of
shareholders for the purpose of electing Trustees unless and until such time as
less than a majority of the Trustees holding office have been elected by
shareholders. In such an event, the Trustees then in office will call a
shareholders' meeting for the election of Trustees. Except for the foregoing
circumstances and unless removed by action of the shareholders in accordance
with the Trust's by-laws, the Trustees shall continue to hold office and may
appoint successor Trustees. The Trustees shall only be liable in cases of their
willful misfeasance, bad faith, gross negligence, or reckless disregard of their
duties.
The Trust's by-laws provide that no persons shall serve as a Trustee if
shareholders holding two-thirds of the outstanding shares have removed him from
that office either by a written declaration filed with the Trust's custodian or
by votes cast at a meeting called for that purpose. The by-laws further provide
that the Trustees shall promptly call a meeting of shareholders for the purpose
of voting upon a question of removal of a Trustee when requested so to do by the
record holders of not less than 10 per centum of the outstanding shares.
TAX-SHELTERED RETIREMENT PLANS
The Funds are suitable investments for individual retirement account plans for
individuals and their non-employed spouses, pension and profit sharing plans for
self-employed individuals, corporations and non-profit organizations, or 401(k)
tax-sheltered retirement plans. The minimum initial purchase of $1,000 for each
Fund may be waived for investments in 401(k) plans.
For more information, write to:
Wright Investors' Service Distributors, Inc.
1000 Lafayette Boulevard
Bridgeport, Connecticut 06604
or call
(203) 330-5060
<PAGE>
WRIGHT TRUE BLUE CHIP
EQUITY INVESTMENT FUNDS
PROSPECTUS
MAY 1, 1995, AS REVISED SEPTEMBER 22, 1995
THE WRIGHT MANAGED EQUITY TRUST
INVESTMENT ADVISER
Wright Investors' Service
1000 Lafayette Boulevard
Bridgeport, Connecticut 06604
PRINCIPAL UNDERWRITER
Wright Investors' Service Distributors, Inc.
1000 Lafayette Boulevard
Bridgeport, Connecticut 06604
ADMINISTRATOR
Eaton Vance Management
24 Federal Street
Boston, Massachusetts 02110
CUSTODIAN
Investors Bank & Trust Company
24 Federal Street
Boston, Massachusetts 02110
TRANSFER AGENT
The Shareholder Services Group, Inc.
Wright Managed Investment Funds
BOS 725
P.O. Box 1559
Boston, Massachusetts 02104
AUDITORS
Deloitte & Touche LLP
125 Summer Street
Boston, Massachusetts 02110
24 FEDERAL STREET
BOSTON, MASSACHUSETTS 02110
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1995, as revised September 22, 1995
===============================================================================
THE WRIGHT MANAGED EQUITY TRUST
24 Federal Street
Boston, Massachusetts 02110
-------------------------------------------------------------------------------
Wright Quality Core Equities Fund
Wright Selected Blue Chip Equities Fund
Wright Junior Blue Chip Equities Fund
-------------------------------------------------------------------------------
TABLE OF CONTENTS Page
General Information And History..................... 2
Investment Objectives And Policies.................. 3
Investment Restrictions............................. 5
Officers And Trustees............................... 6
Control Persons And Principal Holders Of Shares..... 8
Investment Advisory And Administrative Services..... 8
Custodian........................................... 11
Independent Certified Public Accountants............ 11
Brokerage Allocation................................ 12
Fund Shares And Other Securities.................... 13
Purchase, Exchange, Redemption And Pricing Of Shares. 13
Principal Underwriter................................ 14
Calculation Of Performance And Yield Quotations..... 16
Financial Statements................................ 18
Appendix ................................................36
THIS COMBINED STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND IS
AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS ONLY IF PRECEDED OR
ACCOMPANIED BY THE CURRENT COMBINED PROSPECTUS OF THE WRIGHT MANAGED EQUITY
TRUST (THE "TRUST" OR THE "EQUITY TRUST") OFFERING THE ABOVE FUNDS DATED MAY 1,
1995, AS REVISED SEPTEMBER 22, 1995; A COPY OF WHICH MAY BE OBTAINED WITHOUT
CHARGE FROM WRIGHT INVESTORS' SERVICE DISTRIBUTORS, INC., 1000 LAFAYETTE
BOULEVARD, BRIDGEPORT, CONNECTICUT 06604 (800-888-9471).
<PAGE>
GENERAL INFORMATION AND HISTORY
The Trust is a no-load, open-end management investment company organized in
1982 as a Massachusetts business trust. The Trust has three series described
herein (the "Funds" or the "Equity Funds") plus one series offered under a
separate prospectus and statement of additional information. Each Fund is a
diversified fund.
As permitted by Massachusetts law, there will normally be no meetings of
shareholders for the purpose of electing Trustees of the Trust unless and until
such time as less than a majority of the Trustees of the Trust holding office
have been elected by its shareholders. In such an event, the Trustees then in
office will call a shareholders' meeting for the election of Trustees. Subject
to the foregoing circumstances, the Trustees will continue to hold office and
may appoint successor or new Trustees except that, pursuant to provisions of the
Investment Company Act of 1940 (the "1940 Act"), which are set forth in the
By-Laws of the Trust, the shareholders can remove one or more of its Trustees.
The Trust's Declaration of Trust may be amended with the affirmative vote
of a majority of the outstanding shares of such Trust or, if the interests of a
particular Fund are affected, a majority of such Fund's outstanding shares. The
Trustees are authorized to make amendments to a Declaration of Trust that do not
have a material adverse effect on the interests of shareholders. The Trust may
be terminated (i) upon the sale of the Trust's assets to another diversified
open-end management investment company, if approved by the holders of two-thirds
of the outstanding shares of the Trust, except that if the Trustees recommend
such sale of assets, the approval by the vote of a majority of the outstanding
shares will be sufficient, or (ii) upon liquidation and distribution of the
assets of the Trust, if approved by a majority of its Trustees or by the vote of
a majority of the Trust's outstanding shares. If not so terminated, the Trust
may continue indefinitely.
The Trust's Declaration of Trust further provides that the Trust's Trustees
will not be liable for errors of judgment or mistakes of fact or law; however,
nothing in the Declaration of Trust protects a Trustee against any liability to
which he would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence, or reckless disregard of the duties involved in the conduct of
his office.
The Trust is an organization of the type commonly known as a "Massachusetts
business trust." Under Massachusetts law, shareholders of such a trust may,
under certain circumstances, be held personally liable as partners for the
obligations of the Trust. The Trust's Declaration of Trust contains an express
disclaimer of shareholder liability in connection with the Trust property or the
acts, obligations or affairs of the Trust. The Declaration of Trust also
provides for indemnification out of the Trust property of any shareholder held
personally liable for the claims and liabilities to which a shareholder may
become subject by reason of being or having been a shareholder. Thus, the risk
of a shareholder incurring financial loss on account of shareholder liability is
limited to circumstances in which the Trust itself would be unable to meet its
obligations. The risk of any shareholder incurring any liability for the
obligations of the Trust is extremely remote.
The Trust has retained Wright Investors' Service of Bridgeport, Connecticut
("Wright") as investment adviser to carry out the management, investment and
reinvestment of its assets. The Trust has retained Eaton Vance Management
("Eaton Vance"), 24 Federal Street, Boston, Massachusetts 02110, as
administrator of its business affairs.
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES
The investment objective of each Fund is to provide long-term growth of
capital and at the same time earn reasonable current income. The investment
objective and policies of the Equity Funds may be changed by the Trustees
without a vote of the Equity Funds' shareholders. Securities selected for each
Fund are drawn from an investment list prepared by Wright and known as The
Approved Wright Investment List (the "AWIL").
APPROVED WRIGHT INVESTMENT LIST (AWIL). Wright systematically reviews about
3,000 U.S. companies in its proprietary database in order to identify those
which, on the basis of at least five years of audited records, pass the minimum
standards of prudence (e.g. the value of its assets and shareholders' equity
exceeds certain minimum standards and the company's operations have been
profitable during the last three years) and thus are suitable for consideration
by fiduciary investors. Companies which meet these requirements (about 1,600
companies) are considered by Wright to be "investment grade." They may be large
or small, may have their securities traded on exchanges or over the counter, and
may include companies not currently paying dividends on their shares.
These companies are then subjected to extensive analysis and evaluation in
order to identify those which meet Wright's 32 fundamental standards of
investment quality. Only those companies which meet or exceed all of these
standards are eligible for selection by the Wright Investment Committee for
inclusion in the AWIL.
All companies on the AWIL are, in the opinion of Wright, soundly financed
"True Blue Chips" with established records of earnings profitability and equity
growth. All have established investment acceptance and active, liquid markets
for their publicly owned shares.
WRIGHT QUALITY CORE EQUITIES FUND (WQC). This Fund seeks to enhance total
investment return (consisting of price appreciation plus income) by providing
management of a broadly diversified portfolio of equity securities of
well-established companies meeting strict quality standards. The Fund will,
through continuous professional investment supervision by Wright, pursue these
objectives by investing in a diversified portfolio of common stocks of what are
believed to be high-quality, well-established and profitable companies.
This Fund is quality oriented and is suitable for a total equity account
or as a base portfolio for accounts with multiple objectives. Investments,
except for temporary defensive investments, will be made solely in companies on
the AWIL. In selecting companies from the AWIL for this portfolio, the
Investment Committee of Wright Investors' Service selects, based on quantitative
formulae, those companies which are expected to do better over the intermediate
term. The quantitative formulae take into consideration factors such as
over/under valuation and compatibility with current market trends. Investments
in the portfolio are equally weighted in the selected securities.
The disciplines which determine sale include preventing individual
holdings from exceeding 2 1/2 times their normal value position in this Fund and
requiring the sale of the securities of any company which no longer meets the
standards of the AWIL. Also, portfolio holdings which fall in the unfavorable
category based on the quantitative formulae described above are generally sold.
The disciplines which determine purchase provide that new funds, income from
securities currently held, and proceeds of sales of securities will be used to
increase those positions which at current market are the furthest below their
normal target values and to purchase companies which become eligible for the
portfolio as described above.
<PAGE>
WRIGHT SELECTED BLUE CHIP EQUITIES FUND (WBC). This Fund seeks to enhance
the total investment return (consisting of price appreciation plus income) by
providing active management of equity securities of well-established companies
meeting strict quality standards. Equity securities are limited to those
companies whose current operations reflect defined, quantified characteristics
which have been identified by Wright as being likely to provide comparatively
superior total investment return. The process selects approximately two-thirds
of the WQC companies on the basis of Wright's evaluation of their outlook.
Investments are equally weighted.
The disciplines which determine sale include preventing individual
holdings from exceeding 2 1/2 times their normal value position in this Fund,
preventing the retention of the securities of any company which no longer meets
the standards of the AWIL, and liquidating portfolio holdings which cease to
meet the outlook criteria described above. The disciplines which determine
purchase provide that new funds, income from securities currently held, and
proceeds of sales of securities will be used to increase those positions which
at current market values are the furthest below their normal target values and
to purchase companies which become eligible for the portfolio.
WRIGHT JUNIOR BLUE CHIP EQUITIES FUND (WJBC). This Fund seeks to enhance
the total investment return (consisting of price appreciation plus income) by
providing management of equity securities of smaller companies still
experiencing their rapid growth period. Equity securities selected are limited
to those companies selected for the WQC Fund which when sorted by stock market
capitalization represent the smaller companies on the list. Investments are
equally weighted.
A series of disciplines controls the purchase and sale of securities for
the Wright Junior Blue Chip Equities Fund. Each company is reviewed on a
continuous basis by Wright's Investment Committee in order to assure that it
continues to meet all of the required characteristics of investment quality,
financial strength, profitability and stability and growth. These disciplines
are believed to limit the financial risk which is sometimes associated with
investment in smaller companies. However, somewhat higher volatility of market
pricing and greater variability of individual stock investment returns can be
expected in this Fund as compared to the Wright Selected Blue Chip Equities
Fund, which is invested in larger companies.
POLICIES FOR ALL EQUITY FUNDS. It is the policy of the Funds to hold cash
or temporarily invest in cash-equivalent securities (high-quality, short-term,
fixed-income debt securities) whenever this is deemed to be in the best
interests of the shareholders for any reason, which would include the investment
adviser's expectation of a substantial stock market decline. Such defensive
investments will normally be limited to that percentage of Fund assets which is
considered to be desirable under the then prevailing economic and stock market
conditions, normally no more than approximately 20% of a Fund's assets.
Accordingly, it is intended that each Fund remain at least 80% invested in
equity securities at all times, and this is a fundamental investment policy that
may only be changed by the vote of a majority of such Fund's outstanding voting
securities. The Fund may, for defensive purposes, temporarily exceed this 20%
limit if Wright believes that this would be advisable in view of what it
considers extraordinary economic and stock market conditions. In practice,
Wright does not anticipate adopting a defensive position in the Wright Quality
Core Equities Fund (WQC) or the Wright Junior Blue Chip Equities Fund (WJBC)
except in the most extraordinary economic and stock market conditions and
intends to avoid adopting a defensive position in the Wright Selected Blue Chip
Equities Fund (WBC) during periods of normal market fluctuations.
<PAGE>
INVESTMENT RESTRICTIONS
The following investment restrictions have been adopted by each Fund and may be
changed as to a Fund only by the vote of a majority of the Fund's outstanding
voting securities, which as used in this Statement of Additional Information
means the lesser of (a) 67% of the shares of the Fund if the holders of more
than 50% of the shares are present or represented at the meeting or (b) more
than 50% of the shares of the Fund. Accordingly, the Trust may not:
(1) Borrow money in excess of 1/3 of the current market value of the net
assets of any Fund (excluding the amount borrowed) and then only if
such borrowing is incurred as a temporary measure for extraordinary or
emergency purposes or to facilitate the orderly sale of portfolio
securities to accommodate redemption requests; or issue any securities
of a Fund other than its shares of beneficial interest except as
appropriate to evidence indebtedness which the Fund is permitted to
incur. To the extent that a Fund purchases additional portfolio
securities while such borrowings are outstanding, that particular Fund
may be considered to be leveraging its assets, which entails the risks
that the costs of borrowing may exceed the return from the securities
purchased. (The Trust anticipates paying interest on borrowed money at
rates comparable to a Fund's yield and the Trust has no intention of
attempting to increase any Fund's net income by means of borrowing);
(2) Pledge, mortgage or hypothecate its assets to an extent greater than
1/3 of the total assets of a Fund taken at market;
(3) Invest more than 5% of a Fund's total assets taken at current market
value in the securities of any one issuer or allow a Fund to purchase
more than 10% of the voting securities of any one issuer;
(4) Purchase or retain securities of any issuer if 5% of the issuer's
securities are owned by those officers and Trustees of the Trust or its
manager, investment adviser or administrator who own individually more
than 1/2 of 1% of the issuer's securities;
(5) Purchase securities on margin or make short sales except sales against
the box, write or purchase or sell any put options, or purchase
warrants;
(6) Buy or sell real estate, commodities, or commodity contracts unless
acquired as a result of ownership of securities;
(7) Purchase any securities which would cause more than 25% of the market
value of a Fund's total assets at the time of such purchase to be
invested in the securities of issuers having their principal business
activities in the same industry, provided that there is no limitation
in respect to investments in obligations issued or guaranteed by the
U.S. Government or its agencies or instrumentalities;
(8) Underwrite securities issued by other persons except insofar as the
Trust may technically be deemed an underwriter under the Securities Act
of 1933 in selling a portfolio security;
(9) Make loans, except (i) through the loan of a portfolio security, (ii)
by entering into repurchase agreements and (iii) to the extent that the
purchase of debt instruments for a Fund in accordance with the Trust's
investment objective and policies may be deemed to be loans; or
<PAGE>
(10) Purchase from or sell to any of its Trustees or officers, its manager,
administrator or investment adviser, its principal underwriter, if any,
or the officers or directors of said manager, administrator, investment
adviser or principal underwriter, portfolio securities of any Fund.
Although not a matter of fundamental policy, the Trust has no current
intention of entering into repurchase agreements on behalf of any Fund. In
addition, each Fund will not invest (1) more than 15% of its net assets in
illiquid investments, including repurchase agreements maturing in more than
seven days, securities that are not readily marketable and restricted securities
not eligible for resale pursuant to Rule 144A under the Securities Act of 1933
(the "1933 Act"); (2) more than 10% of its net assets in restricted securities,
excluding securities eligible for resale pursuant to Rule 144A or foreign
securities which are offered or sold outside the United States in accordance
with Regulation S under the 1933 Act; or (3) more than 15% of its net assets in
restricted securities (including those eligible for resale under Rule 144A).
If a percentage restriction contained in any Fund's investment policies is
adhered to at the time of investment, a later increase or decrease in the
percentage resulting from a change in the value of portfolio securities or the
Fund's net assets will not be considered a violation of such restriction.
OFFICERS AND TRUSTEES
The officers and Trustees of the Trust are listed below. Except as indicated,
each individual has held the office shown or other offices in the same company
for the last five years. Those Trustees who are "interested persons" of the
Trust, Wright, Eaton Vance, Eaton Vance's wholly-owned subsidiary, Boston
Management and Research ("BMR"), Eaton Vance's parent, Eaton Vance Corp.
(`EVC'), or by Eaton Vance's Trustee, Eaton Vance, Inc. ("EV") as defined in the
1940 Act by virtue of their affiliation with either the Trust, Wright, Eaton
Vance, EVC or EV, are indicated by an asterisk (*).
PETER M. DONOVAN (52), PRESIDENT AND TRUSTEE*
President and Director of Wright Investors' Service; Vice President, Treasurer
and a Director of Wright Investors' Service Distributors, Inc.
Address: 1000 Lafayette Boulevard, Bridgeport, CT 06604
H. DAY BRIGHAM, JR. (68), VICE PRESIDENT, SECRETARY AND TRUSTEE*
Vice President of Eaton Vance, BMR, EV and EVC and Director, EV and EVC;
Director, Trustee and officer of various investment companies managed by Eaton
Vance or BMR; Director, Investors Bank & Trust Company
Address: 24 Federal Street, Boston, MA 02110
WINTHROP S. EMMET (85), TRUSTEE
Attorney at Law, Stockbridge, MA; Trust Officer, First National City Bank, New
York, NY (1963-1971)
Address: Box 327, West Center Road, West Stockbridge, MA 01266
LELAND MILES (71), TRUSTEE
President Emeritus, University of Bridgeport (1987 - present); President,
University of Bridgeport (1974-1987)Director, United Illuminating Company
Address: Tide Mill Landing, 2425 Post Road, Suite 102, Southport, CT 06490
A. M. MOODY III (58), VICE PRESIDENT & TRUSTEE*
Senior Vice President, Wright Investors' Service; President,Wright Investors'
Service Distributors, Inc.
Address: 1000 Lafayette Boulevard, Bridgeport, CT 06604
<PAGE>
LLOYD F. PIERCE (76), TRUSTEE
Retired Vice Chairman (prior to 1984 - President), People's Bank, Bridgeport,
CT; Member, Board of Trustees, People's Bank, Bridgeport, CT; Board of
Directors, Southern Connecticut Gas Company; Chairman, Board of Directors,
COSINE
Address: 125 Gull Circle North, Daytona Beach, FL 32119
GEORGE R. PREFER (60), TRUSTEE
Retired President and Chief Executive Officer, Muller Data Corp., New York, NY
(President 1983-1986) (1989-1990); President and Chief Executive Officer,
InvestData Corporation, A Mellon Financial Services Company (1986-1989)
Address: 7738 Silver Bell Drive, Sarasota, FL 34241
RAYMOND VAN HOUTTE (71), TRUSTEE
President Emeritus and Counselor of The Tompkins County Trust Company, Ithaca,
NY since January 1989; President and Chief Executive Officer, The Tompkins
County Trust Company (1973-1988); President, New York State Bankers Association
1987-1988; Director, McGraw Housing Company, Inc., Deanco, Inc., Evaporated
Metal Products and Ithaco, Inc.
Address: One Strawberry Lane, Ithaca, NY 14850
JUDITH R. CORCHARD (56), VICE PRESIDENT
Executive Vice President, Senior Investment Officer, Vice Chairman of The
Investment Committee and Director, Wright Investors' Service.
Address: 1000 Lafayette Boulevard, Bridgeport, CT 06604
JAMES L. O'CONNOR (50), TREASURER
Vice President of Eaton Vance, BMR and EV. Officer of various investment
companies managed by Eaton Vance or BMR.
Address: 24 Federal Street, Boston, MA 02110
JANET E. SANDERS (59), ASSISTANT TREASURER AND ASSISTANT SECRETARY
Vice President of Eaton Vance, BMR and EV. Officer of various investment
companies managed by Eaton Vance or BMR.
Address: 24 Federal Street, Boston, MA 02110
A. JOHN MURPHY (32), ASSISTANT SECRETARY
Assistant Vice President of Eaton Vance, BMR and EV since March 1, 1994;
employee of Eaton Vance since March 1993. State Regulations Supervisor, The
Boston Company (1991-1993) and Registration Specialist, Fidelity Management &
Research Co. (1986-1991). Officer of various investment companies managed by
Eaton Vance or BMR. Mr. Murphy was elected Assistant Secretary of the Trust on
June 21, 1995.
Address: 24 Federal Street, Boston, MA 02110
ERIC G. WOODBURY (38), ASSISTANT SECRETARY
Vice President of Eaton Vance since February 1993; formerly, associate at
Dechert, Price & Rhoades and Gaston & Snow. Officer of various investment
companies managed by Eaton Vance or BMR. Mr. Woodbury was elected Assistant
Secretary of the Trust on June 21, 1995.
Address: 24 Federal Street, Boston, MA 02110
WILLIAM J. AUSTIN, JR. (43), ASSISTANT TREASURER
Assistant Vice President of Eaton Vance, BMR and EV. Officer of various
investment companies managed by Eaton Vance or BMR. Mr. Austin was elected
Assistant Treasurer of the Trust on December 18, 1991.
Address: 24 Federal Street, Boston, MA 02110
All of the Trustees and officers hold identical positions with The Wright
Managed Income Trust, The Wright Managed Blue Chip Series Trust (except Mr.
Miles) and The Wright EquiFund Equity Trust. The fees and expenses of those
Trustees of the Trust (Messrs. Emmet, Miles, Pierce, Prefer and Van Houtte) who
are not affiliated persons of the Trust are paid by the Funds and other series
of the Trust. They also received additional payments from other investment
companies for which Wright provides investment advisory services. The Trustees
who are "interested persons" of the Trust receive no compensation from the
Trust. For Trustee compensation for the fiscal year ended December 31, 1994, see
the following table.
<PAGE>
<TABLE>
COMPENSATION TABLE
Fiscal Year Ended December 31, 1994
Registrant - The Wright Managed Equity Trust
Registered Investment Companies -- 4
Aggregate
Compensation Esti- Total
from The Pension mated Compen-
Wright Managed Benefits Annual sation
Trustees Equity Trust Accrued Benefits Paid(1)
-------------------------------------------------------
<S> <C> <C> <C> <C>
Winthrop S. Emmet $1,100 None None $5,000
Leland Miles $1,100 None None $5,000
Lloyd F. Pierce $1,100 None None $5,000
George R. Prefer $1,100 None None $5,000
Raymond Van Houtte $1,100 None None $5,000
-------------------------------------------------------
<FN>
(1) Total compensation paid is from The Wright Managed Equity Trust (4 Funds)
and the other boards in the Wright Fund complex (19 Funds) for a total of 23
Funds.
</FN>
</TABLE>
Messrs. Emmet, Miles, Pierce, Prefer and Van Houtte are members of the
Special Nominating Committee of the Trustees of the Trust. The Special
Nominating Committee's function is selecting and nominating individuals to fill
vacancies, as and when they occur, in the ranks of those Trustees who are not
"interested persons" of the Trust, Eaton Vance or Wright. The Trust does not
have a designated audit committee since the full board performs the functions of
such committee.
CONTROL PERSONS AND
PRINCIPAL HOLDERS OF SHARES
As of March 31, 1995, the Trustees and officers of the Trust, as a group, owned
in the aggregate less than 1% of the outstanding shares of any Fund. The Funds'
shares are held primarily by trust departments of depository institutions and
trust companies either for their own account or for the accounts of their
clients. From time to time, several of these trust departments are the record
owners of 5% or more of the outstanding shares of a particular Fund. To date,
the Funds' experience has been that such shareholders do not continuously hold
in excess of 5% or more of a Fund's outstanding shares for extended periods of
time. Should a shareholder continuously hold 5% or more of a Fund's outstanding
shares for an extended period of time (a period in excess of a year), this would
be disclosed by an amendment to this Statement of Additional Information showing
such shareholder's name, address and percentage of ownership. Upon request, the
Trust will provide shareholders with a list of all shareholders holding 5% or
more of a Fund's outstanding shares as of a current date.
As of March 31, 1995, the number of trust departments which were the record
owners of more than 5% of the outstanding shares of the Funds was as follows:
WBC, 4; WJBC, 4; and WQC, 6.
INVESTMENT ADVISORY
AND ADMINISTRATIVE SERVICES
The Trust has engaged Wright to act as each Fund's investment adviser pursuant
to an Investment Advisory Contract dated December 21, 1987 (the "Investment
Advisory Contract"). Wright, located at 1000 Lafayette Boulevard, Bridgeport,
Connecticut, was founded in 1960 and currently provides investment services to
clients throughout the United States and abroad. John Winthrop Wright may be
considered a controlling person of Wright by virtue of his position as Chairman
of the Board of Directors of Wright, and by reason of his ownership of more than
a majority of the outstanding shares of Wright.
The Investment Advisory Contract provides that Wright will carry out the
investment and reinvestment of the assets of the Funds, will furnish
continuously
<PAGE>
<TABLE>
<CAPTION>
Annual % Advisory Fee Rate Fee Earned Fee Earned Fee Earned
Under $100 Mil $250 Mil $500 Mil Over for Fiscal for Fiscal for Fiscal
$100- to to to $1 Yr Ended Yr Ended Yr Ended
Million $250 Mil $500 Mil $1 Billion Billion 12/31/92 12/31/93 12/31/94
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Wright Selected Blue Chip Equities Fund (WBC) 0.55% 0.69% 0.67% 0.63% 0.58% $997,071 $1,042,731 $1,169,165
Wright Junior Blue Chip Equities Fund (WJBC) 0.55% 0.69% 0.67% 0.63% 0.58% $453,476 $364,034 $322,161
Wright Quality Core Equities Fund (WQC) 0.45% 0.59% 0.57% 0.53% 0.48% $308,574 $391,623 $332,192
----------------------------------------------------------------------------------------------- ----------------------
</TABLE>
<PAGE>
an investment program with respect to the Funds, will determine
which securities should be purchased, sold or exchanged, and will implement such
determinations. Wright will furnish to the Funds investment advice and
management services, office space, equipment and clerical personnel, and
investment advisory, statistical and research facilities. In addition, Wright
has arranged for certain members of the Eaton Vance and Wright organizations to
serve without salary as officers or Trustees of the Trust. In return for these
services, each Fund is obligated to pay a monthly advisory fee calculated at the
rates set forth in the table above.
The Trust has engaged Eaton Vance to act as the administrator for each Fund
pursuant to an Administration Agreement dated December 21, 1987 and re-executed
November 1, 1990. Eaton Vance, or its affiliates, act as investment adviser to
investment companies and various individual and institutional clients with
assets under management of approximately $15 billion. Eaton Vance is a
wholly-owned subsidiary of EVC, a publicly held holding company.
Under the Administration Agreement, Eaton Vance is responsible for managing
the business affairs of each Fund, subject to the supervision of the Trust's
Trustees. Eaton Vance services include recordkeeping, preparation and filing of
documents required to comply with Federal and state securities laws, supervising
the activities of the Trust's custodian and transfer agent, providing assistance
in connection with the Trustees' and shareholders' meetings and other
administrative services necessary to conduct each Fund's business. Eaton Vance
will not provide any investment management or advisory services to the Funds.
For its services under the Administration Agreement, Eaton Vance receives
monthly administration fees at the annual rates set forth in the following
table.
<TABLE>
<CAPTION>
Annual % Administration Fee Rates
---------------------------------- Fee Earned Fee Earned Fee Earned
Under $100 Mil $250 Mil Over for Fiscal for Fiscal for Fiscal
$100 to to $500 Yr Ended Yr Ended Yr Ended
Million $250 Mil $500 Mil Million 12/31/92 12/31/93 12/31/94
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wright Selected Blue Chip Equities Fund (WBC) 0.20% 0.06% 0.03% 0.02% $238,876 $242,846 $253,840
Wright Junior Blue Chip Equities Fund (WJBC) 0.20% 0.06% 0.03% 0.02% $160,552 $132,376 $117,150
Wright Quality Core Equities Fund (WQC) 0.20% 0.06% 0.03% 0.02% $137,144 $174,054 $147,641
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Eaton Vance and EV are both wholly owned subsidiaries of EVC. BMR is a
wholly-owned subsidiary of Eaton Vance. Eaton Vance and BMR are both
Massachusetts business trusts, and EV is the trustee of Eaton Vance and BMR. The
Directors of EV are Landon T. Clay, H. Day Brigham, Jr., M. Dozier Gardner,
James B. Hawkes and Benjamin A. Rowland, Jr. The Directors of EVC consist of the
same persons and John G.L. Cabot and Ralph Z. Sorenson. Mr. Clay is chairman,
and Mr. Gardner is president and chief executive officer of EVC, Eaton Vance,
BMR and EV. All of the issued and outstanding shares of Eaton Vance and of EV
are owned by EVC. All of the issued and outstanding shares of BMR are owned by
Eaton Vance. All shares of the outstanding Voting Common Stock of EVC are
deposited in a Voting Trust which expires on December 31, 1996, the Voting
Trustees of which are Messrs. Brigham, Clay, Gardner, Hawkes, and Rowland. The
Voting Trustees have unrestricted voting rights for the election of Directors of
EVC. All of the outstanding voting trust receipts issued under said Voting Trust
are owned by certain of the officers of Eaton Vance and BMR who are also
officers and Directors of EVC and EV. As of March 31, 1995, Messrs. Clay,
Gardner and Hawkes each owned 24% of such voting trust receipts and Messrs.
Rowland and Brigham owned 15% and 13%, respectively, of such voting trust
receipts. Mr. Brigham is an officer and Trustee of the Trust, and a member of
EVC, Eaton Vance, BMR and EV organizations. Messrs. Austin, Murphy, O'Connor and
Woodbury and Ms. Sanders, are officers of the Trust, and are also members of the
Eaton Vance, BMR and EV organizations. Eaton Vance will receive the fees paid
under the Administration Agreement.
Eaton Vance owns all of the stock of Energex Corporation which is engaged
in oil and gas operations. EVC owns all of the stock of Marblehead Energy Corp.
(which engages in oil and gas operations) and 77.3% of the stock of Investors
Bank & Trust Company, the Funds' custodian, which provides custodial, trustee
and other fiduciary services to investors, including individuals, employee
benefit plans, corporations, investment companies, savings banks and other
institutions. In addition, Eaton Vance owns all the stock of Northeast
Properties, Inc., which is engaged in real estate investment and consulting and
management, and of Fulcrum Management, Inc. and MinVen, Inc., which are engaged
in the development of precious metal properties. EVC, EV, Eaton Vance and BMR
may also enter into other businesses.
The Trust will be responsible for all of its expenses not assumed by Wright
under the Investment Advisory Contract or by Eaton Vance under the
Administration Agreement, including, without limitation, the fees and expenses
of its custodian and transfer agent, including those incurred for determining
each Fund's net asset value and keeping each Fund's books; the cost of share
certificates; membership dues in investment company organizations; brokerage
commissions and fees; fees and expenses of registering its shares; expenses of
reports to shareholders, proxy statements, and other expenses of shareholders'
meetings; insurance premiums; printing and mailing expenses; interest, taxes and
corporate fees; legal and accounting expenses; expenses of Trustees not
affiliated with Eaton Vance or Wright; distribution expenses incurred pursuant
to the Trust's distribution plan; and investment advisory and administration
fees. The Trust will also bear expenses incurred in connection with litigation
in which the Trust is a party and the legal obligation the Trust may have to
indemnify its officers and Trustees with respect thereto.
The Trust's Investment Advisory Contract and Administration Agreement will
remain in effect until February 28, 1996. The Trust's Investment Advisory
Contract may be continued with respect to a Fund from year to year thereafter so
long as such continuance after February 28, 1996 is approved at least annually
(i) by the vote of a majority of the Trustees
<PAGE>
who are not "interested persons" of the Trust, Eaton Vance or Wright cast
in person at a meeting specifically called for the purpose of voting on such
approval and (ii) by the Board of Trustees of the Trust or by vote of a majority
of the outstanding shares of that Fund. The Trust's Administration Agreement
may be continued from year to year after February 28, 1996 so long as such
continuance is approved annually by the vote of a majority of the Trustees.
Each agreement may be terminated as to a Fund at any time without penalty on
sixty (60) days' written notice by the Board of Trustees or Directors of either
party, or by vote of the majority of the outstanding shares of that Fund, and
each agreement will terminate automatically in the event of its assignment. Each
agreement provides that, in the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of its obligations or duties to the Trust
under such agreement on the part of Eaton Vance or Wright, Eaton Vance or
Wright will not be liable to the Trust for any loss incurred. The Trust's
Investment Advisory Contract and Administration Agreement were most recently
approved by its Trustees, including the "non-interested Trustees," at a
meeting held on January 25, 1995 and by the shareholders of each of the Funds
at a meeting held on December 9, 1987.
CUSTODIAN
Investors Bank & Trust Company ("IBT"), 24 Federal Street, Boston, Massachusetts
(a 77.3% owned subsidiary of EVC) acts as custodian for the Funds. IBT has the
custody of all cash and securities of the Funds, maintains the Funds' general
ledgers and computes the daily net asset value per share. In such capacity it
attends to details in connection with the sale, exchange, substitution, transfer
or other dealings with the Funds' investments, receives and disburses all funds
and performs various other ministerial duties upon receipt of proper
instructions from the Funds. IBT charges custody fees which are competitive
within the industry. A portion of the custody fee for each fund served by IBT is
based upon a schedule of percentages applied to the aggregate assets of those
funds managed by Eaton Vance for which IBT serves as custodian, the fees so
determined being then allocated among such funds relative to their size. These
fees are then reduced by a credit for cash balances of the particular fund at
IBT equal to 75% of the 91-day, U.S. Treasury Bill auction rate applied to the
particular fund's average daily collected balances for the week. In addition,
each fund pays a fee based on the number of portfolio transactions and a fee for
bookkeeping and valuation services. During the fiscal year ended December 31,
1994, the Funds paid IBT the following amounts under these arrangements.
Wright Selected Blue Chip Equities Fund (WBC)..$57,774
Wright Junior Blue Chip Equities Fund (WJBC)...$27,815
Wright Quality Core Equities Fund (WQC)........$32,641
EVC and its affiliates and its officers and employees from time to time
have transactions with various banks, including the Funds' custodian, IBT. Those
transactions with IBT which have occurred to date have included loans to certain
of Eaton Vance's officers and employees. It is Eaton Vance's opinion that the
terms and conditions of such transactions were not and will not be influenced by
existing or potential custodian or other relationships between the Funds and
IBT.
INDEPENDENT CERTIFIED
PUBLIC ACCOUNTANTS
Deloitte & Touche LLP, 125 Summer Street, Boston, Massachusetts are the Trust's
independent certified public accountants, providing audit services, tax return
preparation, and assistance and consultation with respect to the preparation of
filings with the Securities and Exchange Commission.
<PAGE>
BROKERAGE ALLOCATION
Wright places the portfolio security transactions for each Fund, which in
some cases may be effected in block transactions which include other accounts
managed by Wright. Wright provides similar services directly for bank trust
departments. Wright seeks to execute portfolio security transactions on the most
favorable terms and in the most effective manner possible. In seeking best
execution, Wright will use its best judgment in evaluating the terms of a
transaction, and will give consideration to various relevant factors, including
without limitation the size and type of the transaction, the nature and
character of the markets for the security, the confidentiality, speed and
certainty of effective execution required for the transaction, the reputation,
experience and financial condition of the broker-dealer and the value and
quality of service rendered by the broker-dealer in other transactions, and the
reasonableness of the brokerage commission or markup, if any.
It is expected that on frequent occasions there will be many broker-dealer
firms which will meet the foregoing criteria for a particular transaction. In
selecting among such firms, the Funds may give consideration to those firms
which supply brokerage and research services, quotations and statistical and
other information to Wright for their use in servicing their accounts. The Funds
may include firms which purchase investment services from Wright. The term
"brokerage and research services" includes advice as to the value of securities,
the advisability of investing in, purchasing or selling securities, and the
availability of securities or purchasers or sellers of securities; furnishing
analyses and reports concerning issuers, industries, securities, economic
factors and trends, portfolio strategy and the performance of accounts; and
effecting securities transactions and performing functions incidental thereto
(such as clearance and settlement). Such services and information may be useful
and of value to Wright in servicing all or less than all of their accounts and
the services and information furnished by a particular firm may not necessarily
be used in connection with the account which paid brokerage commissions to such
firm. The advisory fee paid by the Funds to Wright is not reduced as a
consequence of Wright's receipt of such services and information. While such
services and information are not expected to reduce Wright's normal research
activities and expenses, Wright would, through use of such services and
information, avoid the additional expenses which would be incurred if it should
attempt to develop comparable services and information through its own staff.
Subject to the requirement that Wright shall use its best efforts to seek
to execute each Fund's portfolio security transactions at advantageous prices
and at reasonably competitive commission rates, Wright, as indicated above, is
authorized to consider as a factor in the selection of any broker-dealer firm
with whom a Fund's portfolio orders may be placed the fact that such firm has
sold or is selling shares of the Funds or of other investment companies
sponsored by Wright. This policy is consistent with a rule of the National
Association of Securities Dealers, Inc., which rule provides that no firm which
is a member of the Association shall favor or disfavor the distribution of
shares of any particular investment company or group of investment companies on
the basis of brokerage commissions received or expected by such firm from any
source.
Under the Trust's Investment Advisory Contract, Wright has the authority to
pay commissions on portfolio transactions for brokerage and research services
exceeding that which other brokers or dealers might charge provided certain
conditions are met. This authority will not be exercised, however, until the
Funds' Prospectus or this Statement of Additional Information has been
supplemented or amended to disclose the conditions under which Wright proposes
to do so.
<PAGE>
The Trust's Investment Advisory Contract expressly recognizes the practices
which are provided for in Section 28(e) of the Securities Exchange Act of 1934
by authorizing the selection of a broker or dealer which charges a Fund a
commission which is in excess of the amount of commission another broker or
dealer would have charged for effecting that transaction if it is determined in
good faith that such commission was reasonable in relation to the value of the
brokerage and research services which have been provided.
During the fiscal years ended December 31, 1992, 1993 and 1994, the Funds
paid the following aggregate brokerage commissions on portfolio transactions:
<TABLE>
1992 1993 1994
---- ---- ----
<S> <C> <C> <C>
Wright Selected Blue Chip
Equities Fund (WBC) $309,821 $112,735 $345,675
Wright Junior Blue Chip
Equities Fund (WJBC) $145,380 $38,721 $71,949
Wright Quality Core
Equities (WQC) $125,730 $109,394 $112,398
</TABLE>
FUND SHARES AND OTHER SECURITIES
The shares of beneficial interest of the Trust, without par value, may be
issued in two or more series, or Funds. The Trust currently has three Funds
described in this Statement of Additional Information. In addition, the Trust
has one additional series -- Wright International Blue Chip Equities Fund --
that is being offered pursuant to a separate prospectus and statement of
additional information. Shares of each Fund may be issued in an unlimited number
by the Trustees of the Trust. Each share of a Fund represents an equal
proportionate beneficial interest in that Fund and, when issued and outstanding,
the shares are fully paid and non-assessable by the Trust.
Shareholders are entitled to one vote for each full share held. Fractional
shares may be voted in proportion to the amount of a Fund's net asset value
which they represent. Voting rights are not cumulative, which means that the
holders of more than 50% of the shares voting for the election of Trustees can
elect 100% of the Trustees and, in such event, the holders of the remaining less
than 50% of the shares voting on the matter will not be able to elect any
Trustees. Shares have no preemptive or conversion rights and are freely
transferable. Upon liquidation of a Trust or Fund, shareholders are entitled to
share pro rata in the net assets of the affected Trust or Fund available for
distribution to shareholders, and in any general assets of the Trust not
previously allocated to a particular Fund by the Trustees.
PURCHASE, EXCHANGE,
REDEMPTION AND PRICING OF SHARES
For information regarding the purchase of shares, see "How to Buy Shares"
in the Funds' current Prospectus.
For information about exchanges between Funds, see "How to Exchange Shares"
in the Funds' current Prospectus.
<PAGE>
For a description of how the Funds value their shares, see "How the Funds
Value their Shares" in the Funds' current Prospectus. The Funds value short-term
obligations with a remaining maturity of 60 days or less by the amortized cost
method. The amortized method involves initially valuing a security at its cost
(or its fair market value on the sixty-first day prior to maturity) and
thereafter assuming a constant amortization to maturity of any discount or
premium, without regard to unrealized appreciation or depreciation in the market
value of the security.
For information about the redemption of shares, see "How to Redeem or Sell
Shares" in the Funds' current Prospectus.
PRINCIPAL UNDERWRITER
The Trust has adopted a Distribution Plan (the "Plan") on behalf of its
Funds as defined in Rule 12b-1 under the 1940 Act. The Trust's Plan specifically
allows that expenses covered by the Plan may include direct and indirect
expenses incurred by any separate distributor or distributors under agreement
with the Trust in activities primarily intended to result in the sale of its
shares. The expenses of such activities shall not exceed two-tenths of one
percent (2/10 of 1%) per annum of each Fund's average daily net assets. Payments
under the Plans are reflected as an expense in each Fund's financial statements.
Such expenses do not include interest or other financing charges.
The Trust has entered into a distribution contract on behalf of its Funds
with its principal underwriter, Wright Investors' Service Distributors, Inc.
("WISDI"), a wholly-owned subsidiary of Wright, providing for WISDI to act as a
separate distributor of each Fund's shares.
It is intended that each Fund will pay 2/10 of 1% of its average daily net
assets to WISDI for distribution activities on behalf of the Fund in connection
with the sale of its shares. WISDI shall provide on a quarterly basis
documentation concerning the expenses of such activities. Documented expenses of
a Fund shall include compensation paid to and out-of-pocket disbursements of
officers, employees or sales representatives of WISDI, including telephone
costs, the printing of prospectuses and reports for other than existing
shareholders, preparation and distribution of sales literature, and advertising
of any type intended to enhance the sale of shares of the Fund. Subject to the
2/10 of 1% per annum limitation imposed by the Trust's Plan, a Fund may pay
separately for expenses of activities primarily intended to result in the sale
of the Fund's shares. It is contemplated that the payments for distribution
described above will be made directly to WISDI. If the distribution payments to
WISDI exceed its expenses, WISDI may realize a profit from these arrangements.
Peter M. Donovan, President and a Trustee of the Trust and President and a
Director of Wright, is Vice President, Treasurer and a Director of WISDI. A. M.
Moody, III, Vice President and a Trustee of the Trust and Senior Vice President
of Wright, is President and a Director of WISDI.
It is the opinion of the Trustees and officers of the Trust that the
following are not expenses primarily intended to result in the sale of shares
issued by any Fund; fees and expenses of registering shares of the Fund under
Federal or state laws regulating the sale of securities; fees and expenses of
registering the Trust as a broker-dealer or of registering an agent of the Trust
under Federal or state laws regulating the sale of securities; fees of
registering, at the request of the Trust, agents or representatives of a
principal underwriter or distributor of any Fund under Federal or state laws
regulating the sale of securities, provided that no sales commission or "load"
is charged on sales of shares of the Fund; and fees and expenses of pre-
<PAGE>
paring and setting in type the Trust's registration statement under the
Securities Act of 1933. Should such expenses be deemed by a court or agency
having jurisdiction to be expenses primarily intended to result in the sale of
shares issued by a Fund, they shall be considered to be expenses contemplated
by and included in the applicable Plan but not subject to the 2/10 of 1% per
annum limitation described above.
Under the Trust's Plan, the President or Vice President of the Trust shall
provide to the Trustees for their review, and the Trustees shall review at least
quarterly, a written report of the amounts expended under the Plan and the
purposes for which such expenditures were made. For the fiscal year ended
December 31, 1994, it is estimated that WISDI spent approximately the following
amounts on behalf of the Wright Managed Investment Funds including these Funds:
<TABLE>
<CAPTION>
Wright Investors Service Distributors, Inc.
Financial Summaries for the Year 1994
Printing & Mailing Travel and Commissions and Administration
FUNDS Promotional Prospectuses Entertainment Service Fees and Other TOTAL
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Wright Selected Blue Chip
Equities Fund (WBC) $209,846 $62,612 $51,608 -- $55,402 $379,468
Wright Junior Blue Chip
Equities Fund (WJBC) $64,784 $19,330 $15,932 -- $17,104 $117,150
Wright Quality Core
Equities Fund (WQC) $81,645 $24,361 $20,079 -- $21,556 $147,641
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The table below shows the distribution expenses allowable to WISDI and paid
by each Fund for the fiscal year ended December 31, 1994.
<TABLE>
Distribution Distribution Expenses
Expenses Paid as a % of Fund's
Paid by Fund Average Net Asset Value
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Wright Selected Blue Chip Equities Fund (WBC) $379,468 0.20%
Wright Junior Blue Chip Equities Fund (WJBC) $117,150 0.20%
Wright Quality Core Equities (WQC) $147,641 0.20%
---------------------------------------------------------------------------------------------------------------------
</TABLE>
Under its terms the Trust's Plan remains in effect from year to year,
provided such continuance is approved annually by a vote of its Trustees,
including a majority of the Trustees who are not interested persons of the Trust
and who have no direct or indirect financial interest in the operation of the
Plan. The Plan may not be amended to increase materially the amount to be spent
for the services described therein as to any Fund without approval of a majority
of the outstanding voting securities of that Fund and all material amendments of
the Plan must also be approved by the Trustees of the Trust in the manner
described above. The Trust's Plan may be terminated at any time as to any Fund
without payment of any
<PAGE>
penalty by vote of a majority of the Trustees of the Trust who are not
interested persons of the Trust and who have no direct or indirect financial
interest in the operation of the Plan or by a vote of a majority of the
outstanding voting securities of that Fund. So long as the Trust's Plan is
in effect, the selection and nomination of Trustees who are not interested
persons of the Trust shall be committed to the discretion of the Trustees who
are not such interested persons. The Trustees of the Trust have determined
that in their judgment there is a reasonable likelihood that the Plan will
benefit the Trust and its shareholders.
The continuation of the Plan was most recently approved by the Trustees
of the Trust on January 25, 1995 and by the shareholders of each Fund on
December 9, 1987.
CALCULATION OF PERFORMANCE
AND YIELD QUOTATIONS
The average annual total return of each Fund is determined for a particular
period by calculating the actual dollar amount of investment return on a $1,000
investment in the Fund made at the maximum public offering price (i.e. net asset
value) at the beginning of the period, and then calculating the annual
compounded rate of return which would produce that amount. Total return for a
period of one year is equal to the actual return of the Fund during that period.
This calculation assumes that all dividends and distributions are reinvested at
net asset value on the reinvestment dates during the period.
The average annual total return of each Fund for the one, three and
five-year periods ended December 31, 1994 and the period from inception to
December 31, 1994 are shown in the table below.
Each Fund's yield is computed by dividing its net investment income per
share earned during a recent 30-day period by the maximum offering price (i.e.
net asset value) per share on the last day of the period and annualizing the
resulting figure. Net investment income per share is equal to the Fund's
dividends and interest earned during the period, with the resulting number being
divided by the average daily number of shares outstanding and entitled to
receive dividends during the period.
<TABLE>
<CAPTION>
Year Ended 12/31/94 Inception
___________________________________________ To Inception
1 Year 3 Years 5 Years 10 Years 12/31/94 Date
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Wright Selected Blue Chip Equities Fund (1) -3.52% 1.03% 6.28% 11.32% 10.94% 1/04/83
Wright Junior Blue Chip Equities Fund (2) -2.75% 2.73% 5.83% -- 8.54% 1/14/85
Wright Quality Core Equities Fund (3) -0.73% 2.70% 7.88% -- 11.56% 8/07/85
---------------------------------------------------------------------------------------------------------------------------------
<FN>
(1) If a portion of the WBC Fund's expenses had not been subsidized for the
years ended December 31, 1987, 1986 and 1984, the Fund would have had lower
returns; (2) If a portion of the WJBC Fund's expenses had not been subsidized
during the years ended December 31, 1987 and 1985, the Fund would have had lower
returns; (3) If a portion of the WQC Fund's expenses had not been subsidized
during the years ended December 31, 1990, 1989, 1988, 1987 and 1985, the Fund
would have had lower returns.
</FN>
</TABLE>
<PAGE>
For the 30-day period ended December 31, 1994, the yield of each Fund was
as follows:
30-Day Period
Ended
December 31, 1994*
---------------------
Wright Selected Blue Chip Equities Fund 1.57%
Wright Junior Blue Chip Equities Fund 1.25%
Wright Quality Core Equities Fund 1.71%
* according to the following formula:
6
Yield = 2 [ ( a-b + 1) - 1 ]
---
cd
Where:
a = dividends and interest earned during the period.
b = expenses accrued for the period (after reductions).
c = the average daily number of accumulation units outstanding during
the period.
d = the maximum offering price per accumulation unit on the last day
of the period.
NOTE: "a" has been calculated for stocks by dividing the stated dividend rate
for each security held during the period by 360. "a" has been estimated for debt
securities other than mortgage certificates by dividing the year-end market
value times the yield to maturity by 360. "a" for mortgage securities, such as
GNMAs, is the actual income earned. Neither discount or premium have been
amortized.
"b" has been estimated by dividing the actual 1992 expense amounts by 360
or the number of days the Fund was in existence.
A Fund's yield or total return may be compared to the Consumer Price Index
and various domestic securities indices. A Fund's yield or total return and
comparisons with these indices may be used in advertisements and in information
furnished to present or prospective shareholders.
From time to time, evaluations of a Fund's performance made by independent
sources may be used in advertisements and in information furnished to present or
prospective shareholders. According to the rankings prepared by Lipper
Analytical Services, Inc., an independent service which monitors the performance
of mutual funds. The Lipper performance analysis includes the reinvestment of
dividends and capital gain distributions, but does not take sales charges into
consideration and is prepared without regard to tax consequences.
<PAGE>
<TABLE>
<CAPTION>
WRIGHT SELECTED BLUE CHIP EQUITIES FUND (WBC)
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1994
================================================================================
Shares Value
--------------------------------------------------------------------------------
<S> <C> <C>
EQUITY INTERESTS -- 98.0%
APPAREL -- 4.9%
Fruit of the Loom, Inc*............. 65,000 $ 1,755,000
Justin Industries................... 145,000 1,721,875
Nike Inc............................ 25,000 1,865,625
Reebok International Ltd............ 51,000 2,014,500
VF Corp............................. 36,830 1,790,859
-------------
$ 9,147,859
-------------
AUTOMOTIVE -- 2.0%
Modine Manufacturing Co............. 68,000 $ 1,955,000
Myers Industries.................... 118,625 1,660,750
-------------
$ 3,615,750
-------------
BEVERAGES -- 1.1%
Brown Forman Corp................... 66,000 $ 2,013,000
-------------
CHEMICALS -- 2.1%
Clorox Company...................... 31,140 $ 1,833,368
Sherwin Williams Co................. 61,800 2,047,125
-------------
$ 3,880,493
-------------
CONSTRUCTION -- 1.0%
Clayton Homes....................... 119,250 $ 1,878,188
-------------
DIVERSIFIED -- 4.0%
National Service Industries......... 72,000 $ 1,845,000
Rockwell International Corp......... 53,210 1,902,258
Standex International Corp.......... 57,730 1,811,279
Teleflex, Incorporated.............. 55,000 1,952,500
-------------
$ 7,511,037
-------------
DRUGS, COSMETICS & HEALTH CARE -- 6.9%
Alberto Culver Co. Class A.......... 79,000 $ 1,935,500
Becton Dickenson & Co............... 40,000 1,920,000
Bristol-Meyers Squibb Co............ 33,564 1,942,517
Johnson & Johnson................... 32,600 1,784,850
Medex Inc........................... 124,000 1,674,000
Merck & Co., Inc.................... 47,000 1,791,875
Upjohn Co........................... 57,000 1,752,750
-------------
$ 12,801,492
-------------
ELECTRICAL -- 2.8%
Emerson Electric Co................. 26,650 $ 1,665,625
General Electric Co................. 39,540 2,016,540
Juno Lighting, Inc.................. 88,000 1,562,000
-------------
$ 5,244,165
-------------
ELECTRONICS -- 6.5%
Compaq Computer*.................... 48,000 $ 1,896,000
EG&G................................ 60,000 847,500
E-Systems Inc....................... 48,955 2,037,752
Hewlett Packard Inc................. 19,000 1,897,625
Intel Corporation................... 28,155 1,798,401
Methode Electronics Class A......... 103,000 1,751,000
Raytheon Co......................... 29,180 1,863,873
-------------
$ 12,092,151
-------------
FINANCIAL -- 17.0%
AFLAC Inc........................... 55,000 $ 1,760,000
American International Group........ 20,000 1,960,000
Amsouth Bancorp..................... 66,000 1,699,500
Bancorp Hawaii Inc.................. 65,175 1,653,816
Commerce Bancshares, Inc............ 69,037 1,864,012
Edwards (A.G.), Inc................. 106,000 1,908,000
Fifth Third Bancorp................. 36,000 1,728,000
First Colonial Bankshares........... 86,000 1,741,500
First Colony Corp................... 80,000 1,790,000
First Hawaiian Inc.................. 70,500 1,674,375
First Virginia Banks Inc............ 52,665 1,685,280
Keycorp............................. 71,208 1,780,200
Raymond James Financial Corp........ 127,000 1,778,000
Southern National Corp.............. 92,000 1,759,500
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Southtrust Corporation.............. 88,000 1,584,000
Star Banc Corp...................... 49,965 1,817,477
SunTrust Banks Inc.................. 35,920 1,715,180
West One Bancorp.................... 67,000 1,775,500
-------------
$ 31,674,340
-------------
FOOD -- 5.0%
Archer Daniels Midland Co........... 91,375 $ 1,884,609
Dean Foods Company.................. 64,000 1,856,000
Hormel (George A.) & Company........ 68,000 1,683,000
Pioneer Hi-Bred International....... 58,000 2,001,000
Universal Foods Corp................ 70,000 1,925,000
-------------
$ 9,349,609
-------------
MACHINERY & EQUIPMENT -- 1.9%
Briggs & Stratton Corp.............. 56,180 $ 1,839,895
Pitney-Bowes Inc.................... 54,500 1,730,375
-------------
$ 3,570,270
-------------
METAL PRODUCTS MANUFACTURERS -- 4.1%
CLARCOR Inc......................... 93,950 $ 1,996,438
Crown Cork & Seal Company*.......... 53,000 2,000,750
Kaydon Corp......................... 81,000 1,944,000
Watts Industries Inc................ 76,000 1,605,500
-------------
$ 7,546,688
-------------
OIL, GAS & COAL -- 0.9%
Exxon Corporation................... 25,800 $ 1,567,350
-------------
PAPER -- 1.0%
Kimberly-Clark Corp................. 38,000 $ 1,919,000
-------------
PRINTING & PUBLISHING -- 7.0%
Banta (George) Corp................. 60,899 $ 1,842,195
Ennis Business Forms................ 134,220 1,677,750
Gannett Co. Inc..................... 34,080 1,814,760
Harland (John H.) Co................ 89,900 1,798,000
Lee Enterprises, Inc................ 57,300 1,976,850
Reynolds & Reynolds Inc............. 78,900 1,972,500
Wallace Computer Services........... 68,600 1,989,400
-------------
$ 13,071,455
-------------
RECREATION -- 3.1%
Carnival Corporation................ 90,590 $ 1,925,038
International Dairy Queen*.......... 113,000 1,921,000
Luby's Cafeteria, Inc............... 84,750 1,896,281
-------------
$ 5,742,319
-------------
RETAILERS -- 7.5%
Casey's General Stores.............. 128,000 $ 1,920,000
Dress Barn Inc*..................... 178,000 1,913,500
Giant Food Inc...................... 82,000 1,783,500
Hannaford Brothers Company.......... 70,000 1,776,250
Land's End Inc*..................... 112,000 1,540,000
May Department Stores............... 50,000 1,687,500
Melville Corp....................... 58,000 1,790,750
Ross Stores Inc..................... 138,000 1,552,500
-------------
$ 13,964,000
-------------
TRANSPORTATION -- 3.2%
Air Express International Corp...... 105,000 $ 2,100,000
Arnold Industries Inc............... 90,000 1,867,500
Intertrans Corp..................... 147,400 1,916,200
-------------
$ 5,883,700
</TABLE>
------------
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
UTILITIES -- COMMUNICATIONS -- 2.0%
Ameritech Corp...................... 48,240 $ 1,947,690
Lincoln Telecom Co.................. 107,400 1,825,800
-------------
$ 3,773,490
-------------
UTILITIES -- ELECTRIC POWER -- 5.0%
DQE................................. 65,000 $ 1,925,625
Duke Power Co....................... 47,850 1,824,281
Southwestern Energy Company......... 110,000 1,636,250
TECO Energy, Inc.................... 97,800 1,968,225
Wisconsin Energy Corp............... 77,350 2,001,431
-------------
$ 9,355,812
-------------
UTILITIES-- ELECTRIC POWER HOLDING-- 1.0%
Central & South West Corp........... 79,400 $ 1,796,425
-------------
UTILITIES-- ELECTRIC POWER & GAS-- 1.1%
NIPSCO Industries Inc............... 68,000 $ 2,023,000
-------------
MISCELLANEOUS -- 6.9%
Dionex Corporation*................. 48,000 $ 1,812,000
Genuine Parts Co.................... 54,150 1,949,400
Handleman Co........................ 172,000 1,956,500
Marshall Industries*................ 72,265 1,933,089
Medicine Shoppe International....... 68,300 1,827,021
Pioneer Stand Electronics........... 101,000 1,590,750
Stanhome Inc........................ 58,000 1,834,250
-------------
$ 12,903,010
-------------
TOTAL INVESTMENTS -- 98.0%
(identified cost, $180,285,908) $182,324,603
OTHER ASSETS,
LESS LIABILITIES-- 2.0% 3,691,188
-------------
NET ASSETS-- 100% $186,015,791
=============
</TABLE>
* Non-income-producing security.
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
WRIGHT SELECTED BLUE CHIP EQUITIES FUND
================================================================================
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1994
--------------------------------------------------------------------------------
<S> <C>
ASSETS:
Investments --
Identified cost.................................... $180,285,908
Unrealized appreciation............................ 2,038,695
-------------
Total Value (Note 1A)............................ $182,324,603
Receivable for fund shares sold...................... 241,516
Cash................................................. 471
Receivable for investments sold...................... 4,843,983
Dividends receivable................................. 532,153
-------------
Total Assets....................................... $187,942,726
-------------
LIABILITIES:
Loans payable........................................ $ 52,983
Capital gains distribution payable....... 4,065
Payable for fund shares reacquired....... 1,846,092
Trustee fees payable..................... 312
Custodian fee payable.................... 14,482
Accrued expenses and other liabilities... 9,001
-------------
Total Liabilities...................... $ 1,926,935
-------------
NET ASSETS.................................. $186,015,791
=============
NET ASSETS CONSIST OF:
Proceeds from sales of shares (including the market
value of securities received in exchange for Fund
shares and shares issued to shareholders in
payment of distributions declared), less cost
of shares reacquired............................... $178,381,517
Accumulated undistributed net realized gain
on investments (computed on the basis of
identified cost)................................... 3,586,353
Unrealized appreciation of investments (computed
on the basis of identified cost)................... 2,038,695
Undistributed net investment income.................. 2,009,226
-------------
Net assets applicable to outstanding shares $186,015,791
=============
SHARES OF BENEFICIAL INTEREST
OUTSTANDING........................................ 13,431,844
=============
NET ASSET VALUE, OFFERING PRICE,
AND REDEMPTION PRICE PER SHARE
OF BENEFICIAL INTEREST............................. $13.85
=============
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
For the Year Ended December 31, 1994
--------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME:
Income --
Dividends.......................................... $ 4,510,245
Interest........................................... 408,176
-------------
Total Income..................................... $ 4,918,421
-------------
Expenses --
Investment Adviser fee (Note 2).................... $ 1,169,165
Administrator fee (Note 2)......................... 253,840
Compensation of Trustees not affiliated with
the Investment Adviser or Administrator.......... 2,151
Custodian fee (Note 2)............................. 57,774
Transfer and dividend disbursing agent fees........ 22,462
Distribution expenses (Note 3)..................... 379,468
Audit services..................................... 24,533
Legal services..................................... 2,523
Registration costs................................. 18,481
Printing........................................... 2,464
Miscellaneous...................................... 11,957
Interest paid on loans............................. 699
-------------
Total Expenses................................... $ 1,945,517
-------------
Net Investment Income.......................... $ 2,972,904
-------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS:
Net realized gain on investment transactions
(identified cost basis)............................ $ 9,148,808
Change in unrealized appreciation
of investments..................................... (19,763,621)
-------------
Net realized and unrealized gain (loss)
on investments..................................... $(10,614,813)
-------------
Net decrease in net assets
from operations................................ $ (7,641,909)
=============
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
WRIGHT SELECTED BLUE CHIP EQUITIES FUND
================================================================================
Year Ended
December 31,
---------------------------------
STATEMENT OF CHANGES IN NET ASSETS 1994 1993
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE)IN NET ASSETS:
From operations --
Net investment income...................................................... $ 2,972,904 $ 2,189,863
Net realized gain (loss) on investment transactions........................ 9,148,808 (767,573)
Change in unrealized appreciation of investments........................... (19,763,621) 2,320,286
-------------- --------------
Increase (decrease) in net assets from operations..................... $ (7,641,909) $ 3,742,576
-------------- --------------
Undistributed net investment income included in
price of shares sold and redeemed (Note 1C).................................. $ 280,883 $ 227,658
-------------- --------------
Distributions to shareholders --
From net investment income................................................. $ (2,385,221) $ (2,019,776)
From net realized gain on investment transactions.......................... (4,787,377) --
-------------- -------------
Total distributions to shareholders................................... $ (7,172,598) $ (2,019,776)
-------------- --------------
Net increase from fund share transactions (exclusive of amounts
allocated to net investment income) (Note 4)................................ $ 25,068,300 $ 20,534,008
-------------- --------------
Net increase in net assets............................................ $ 10,534,676 $ 22,484,466
NET ASSETS:
At beginning of year........................................................... 175,481,115 152,996,649
-------------- -------------
At end of year................................................................. $ 186,015,791 $ 175,481,115
============== =============
UNDISTRIBUTED NET INVESTMENT INCOME INCLUDED IN NET ASSETS.......................... $ 2,009,226 $ 1,140,660
============== =============
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
WRIGHT JUNIOR BLUE CHIP EQUITIES FUND (WJBC)
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1994
================================================================================
Shares Value
--------------------------------------------------------------------------------
<S> <C> <C>
EQUITY INTERESTS -- 96.6%
APPAREL -- 4.5%
Justin Industries................... 31,000 $ 368,125
Nautica Enterprises*................ 32,000 968,000
Stride Rite Corp.................... 29,000 322,625
-------------
$ 1,658,750
-------------
AUTOMOTIVE -- 2.0%
Modine Manufacturing................ 26,600 $ 764,756
-------------
DIVERSIFIED -- 4.8%
Standex International Corp.......... 27,000 $ 847,125
Teleflex, Inc....................... 26,000 923,000
-------------
$ 1,770,125
DRUGS, COSMETICS & HEALTH CARE -- 6.7%
Alberto Culver Company Class A...... 42,000 $ 1,029,000
Invacare Corporation................ 13,000 445,250
Nellcor Inc*........................ 18,000 594,000
Sunrise Medical, Inc*............... 15,000 414,375
-------------
$ 2,482,625
ELECTRICAL -- 4.4%
Baldor Electric..................... 15,000 $ 405,000
Juno Lighting Inc................... 68,600 1,217,650
-------------
$ 1,622,650
ELECTRONICS -- 3.1%
EG&G................................ 56,000 $ 791,000
Methode Electronics Class A......... 21,000 357,000
-------------
$ 1,148,000
FINANCIAL -- 2.9%
First Hawaiian Inc.................. 15,000 $ 356,250
Raymond James Financial Corp........ 27,000 378,000
Southern National Corp.............. 19,000 363,375
-------------
$ 1,097,625
FOOD -- 4.3%
Bob Evans Farms, Inc................ 45,000 $ 922,500
Universal Food Corporation.......... 24,000 660,000
-------------
$ 1,582,500
MACHINERY & EQUIPMENT -- 2.5%
Donaldson Co. Inc................... 40,000 $ 945,000
-------------
METAL PRODUCTS MANUFACTURERS -- 6.5%
CLARCOR Inc......................... 57,300 $ 1,217,625
Kaydon Corp......................... 34,300 823,200
Watts Industries Inc................ 17,000 359,125
-------------
$ 2,399,950
PAPER -- 1.1%
Wausau Paper Mills Co............... 18,700 $ 425,425
-------------
PRINTING & PUBLISHING -- 10.3%
Banta (George) Co., Inc............. 28,750 $ 869,688
Harland J.H. Co..................... 46,000 920,000
Lee Enterprises, Inc................ 33,700 1,162,650
Wallace Computer Services........... 30,400 881,600
-------------
$ 3,833,938
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
RECREATION -- 5.9%
International Dairy Queen*.......... 33,000 $ 561,000
Luby's Cafeteria, Inc............... 41,000 917,375
Morrison Restaurants Inc............ 29,500 722,750
-------------
$ 2,201,125
RETAILERS -- 5.6%
Casey's General Stores.............. 70,000 $ 1,050,000
Hannaford Brothers Co............... 16,000 406,000
Lands' End Inc*..................... 22,000 302,500
Ross Stores, Inc.................... 29,000 326,250
-------------
$ 2,084,750
TRANSPORTATION -- 5.5%
Air Express International Corp...... 38,250 $ 765,000
Arnold Industries Inc............... 39,200 813,400
Comair Holdings, Inc................ 26,000 455,000
-------------
$ 2,033,400
UTILITIES -- 9.6%
Black Hills Corporation............. 41,300 $ 882,788
Lincoln Telecom..................... 60,000 1,020,000
Southern Indiana Gas & Electric..... 36,000 954,000
Southwestern Energy Company......... 47,000 699,125
-------------
$ 3,555,913
MISCELLANEOUS -- 16.9%
Blair (John) Corp................... 25,350 $ 1,014,000
Crawford & Co....................... 39,000 624,000
Dionex Corp*........................ 28,400 1,072,100
Handleman Co........................ 42,000 477,750
Lydall Inc*......................... 24,000 780,000
Marshall Industries*................ 33,000 882,750
Pioneer Stand Electronics........... 44,000 693,000
Stanhome Inc........................ 23,000 727,375
-------------
$ 6,270,975
TOTAL INVESTMENTS -- 96.6%
(identified cost, $34,143,838) $ 35,877,507
OTHER ASSETS,
LESS LIABILITIES-- 3.4% 1,246,533
-------------
NET ASSETS-- 100.0% $ 37,124,040
=============
</TABLE>
* Non-income-producing security.
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
WRIGHT JUNIOR BLUE CHIP EQUITIES FUND
================================================================================
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1994
--------------------------------------------------------------------------------
<S> <C>
ASSETS:
Investments --
Identified cost.................................. $ 34,143,838
Unrealized appreciation.......................... 1,733,669
-------------
Total Value (Note 1A).......................... $ 35,877,507
Cash............................................... 94,335
Receivable for fund shares sold.................... 35,732
Receivable for investments sold.................... 1,353,625
Dividends receivable............................... 52,154
-------------
Total Assets..................................... $ 37,413,353
-------------
LIABILITIES:
Payable for fund shares reacquired................. $ 278,653
Trustee fees payable............................... 312
Custodian fee payable.............................. 8,883
Accrued expenses and other liabilities............. 1,465
-------------
Total Liabilities................................ $ 289,313
-------------
NET ASSETS............................................ $ 37,124,040
=============
NET ASSETS CONSIST OF:
Proceeds from sales of shares (including the market
value of securities received in exchange for Fund
shares and shares issued to shareholders in
payment of distributions declared), less cost
of shares reacquired............................. $ 30,253,969
Accumulated undistributed net realized gain
on investments (computed on the basis of
identified cost)................................. 4,751,919
Unrealized appreciation of investments (computed
on the basis of identified cost)................. 1,733,669
Undistributed net investment income................ 384,483
-------------
Net assets applicable to outstanding shares...... $ 37,124,040
=============
SHARES OF BENEFICIAL INTEREST
OUTSTANDING...................................... 3,375,431
=============
NET ASSET VALUE, OFFERING PRICE,
AND REDEMPTION PRICE PER SHARE
OF BENEFICIAL INTEREST........................... $11.00
=============
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
For the Year Ended December 31, 1994
--------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME:
Income --
Dividends........................................ $ 1,106,123
Interest......................................... 67,273
-------------
Total Income................................... $ 1,173,396
-------------
Expenses --
Investment Adviser fee (Note 2).................. $ 322,161
Administrator fee (Note 2)....................... 117,150
Compensation of trustees not affiliated with
the Investment Adviser or Administrator........ 2,201
Custodian fee (Note 2)........................... 27,815
Transfer and dividend disbursing agent fees..... 11,755
Distribution expenses (Note 3)................... 117,150
Audit services................................... 24,133
Legal services................................... 1,781
Registration costs............................... 11,562
Printing......................................... 2,541
Miscellaneous.................................... 5,826
-------------
Total Expenses................................. 644,075
-------------
Net Investment Income........................ $ 529,321
-------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS:
Net realized gain on investment transactions
(identified cost basis)......................... $ 6,599,714
Change in unrealized appreciation
of investments.................................. (8,816,947)
-------------
Net realized and unrealized gain (loss)
on investments................................ $ (2,217,233)
-------------
Net decrease in net assets
from operations............................. $ (1,687,912)
=============
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
WRIGHT JUNIOR BLUE CHIP EQUITIES FUND
================================================================================
Year Ended
December 31,
-------------------------------------
STATEMENT OF CHANGES IN NET ASSETS 1994 1993
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income...................................................... $ 529,321 $ 571,301
Net realized gain on investment transactions............................... 6,599,714 4,621,330
Change in unrealized appreciation of investments........................... (8,816,947) (81,609)
-------------- ---------------
Increase (decrease) in net assets from operations..................... $ (1,687,912) $ 5,111,022
-------------- ---------------
Undistributed net investment loss included in
price of shares sold and redeemed (Note 1C).................................. $ (98,655) $ (4,664)
- -------------- ---------------
Distributions to shareholders
From net investment income................................................... $ (488,244) $ (335,175)
From net realized gain on investment transactions............................ (2,117,788) (3,274,154)
-------------- ---------------
Total distribution to shareholders.................................... $ (2,606,032) $ (3,609,329)
-------------- --------------
Net increase (decrease) from fund share transactions (exclusive of
amounts allocated to net investment income) (Note 4)......................... $ (26,708,885) $ 2,093,853
- -------------- ---------------
Net increase (decrease) in net assets................................. $ (31,101,484) $ 3,590,882
NET ASSETS:
At beginning of year........................................................... 68,225,524 64,634,642
-------------- ---------------
At end of year................................................................. $ 37,124,040 $ 68,225,524
============== ===============
UNDISTRIBUTED NET INVESTMENT INCOME INCLUDED IN NET ASSETS.......................... $ 89,314 $ 146,892
============== ===============
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
WRIGHT QUALITY CORE EQUITIES FUND (WQC)
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1994
================================================================================
Shares Value
--------------------------------------------------------------------------------
<S> <C> <C>
EQUITY INTERESTS -- 92.7%
APPAREL -- 2.5%
Nike Inc............................ 6,500 $ 485,063
Reebok International................ 11,400 450,300
VF Corp............................. 6,700 325,787
-------------
$ 1,261,150
-------------
BEVERAGES -- 1.8%
Brown-Forman Corp .................. 14,650 $ 446,825
Coca-Cola Co........................ 9,532 490,898
-------------
$ 937,723
-------------
CHEMICALS -- 7.0%
Bandag, Inc......................... 6,000 $ 363,000
Clorox Corp......................... 8,300 488,662
Great Lakes Chemical Corp........... 6,000 342,000
Int'l Flavors & Fragrances Inc...... 9,700 448,625
Lubrizol Corp....................... 12,900 436,988
Nalco Chemical...................... 10,500 351,750
PPG Industries...................... 11,000 408,375
Proctor & Gamble Co................. 5,000 310,000
Sherwin Williams Co................. 12,700 420,688
-------------
$ 3,570,088
-------------
CONSTRUCTION -- 0.8%
Clayton Homes....................... 27,108 $ 426,951
-------------
DIVERSIFIED -- 2.1%
Lancaster Colony Corp............... 9,932 $ 291,752
Minnesota Mining & Mfg. Co.......... 7,516 401,167
Rockwell Int'l. Corp................ 10,200 364,650
-------------
$ 1,057,569
-------------
DRUGS, COSMETICS & HEALTH CARE -- 9.6%
Abbott Laboratories................. 16,330 $ 532,766
Alberto Culver Co. Class A.......... 15,500 379,750
Becton Dickinson & Co............... 9,400 451,200
Biomet, Inc*........................ 29,500 413,000
Bristol-Meyers Squibb Co............ 7,700 445,638
Johnson & Johnson................... 8,700 476,325
Merck & Co.......................... 9,242 352,351
Pfizer Inc.......................... 6,400 494,400
St. Jude Medical Inc................ 13,000 516,750
Schering-Plough Corp................ 6,200 458,800
Upjohn Co........................... 12,400 381,300
-------------
$ 4,902,280
-------------
ELECTRICAL -- 3.5%
Baldor Electric..................... 14,000 $ 378,000
Emerson Electric Co................. 6,800 425,000
General Electric Co................. 9,100 464,100
Thomas & Betts Corp................. 7,500 503,438
-------------
$ 1,770,538
-------------
ELECTRONICS -- 7.6%
ADC Telecommunications*............. 9,500 $ 475,000
Amp Inc............................. 5,600 407,400
Compaq Computer*.................... 8,600 339,700
E Systems Inc....................... 10,100 420,412
Hewlett-Packard Inc................. 5,200 519,350
Intel Corporation................... 5,400 344,925
Linear Technology Corp.............. 10,300 509,850
Motorola Inc........................ 7,800 451,425
Raytheon Co......................... 6,300 402,413
-------------
$ 3,870,475
-------------
FINANCIAL -- 9.9%
AFLAC, Inc.......................... 8,400 $ 268,800
American International Group........ 3,600 352,800
Amsouth Bancorp..................... 11,500 296,125
Andrew Corporation*................. 7,700 402,325
Bancorp Hawaii...................... 12,550 318,456
Commerce Bancshares, Inc............ 9,450 255,150
Edwards (A.G.), Inc................. 20,800 374,400
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
Fifth Third Bancorp................. 7,200 $ 345,600
First Hawaiian Inc.................. 13,900 330,125
First Virginia Banks Inc............ 10,600 339,200
Keycorp............................. 12,748 318,700
Southtrust Corp..................... 19,800 356,400
Star Banc Corp...................... 10,200 371,025
Suntrust Banks Inc.................. 8,500 405,875
West One Bancorp.................... 12,300 325,950
-------------
$ 5,060,931
-------------
FOOD -- 5.2%
Archer Daniels Midland Co........... 27,187 $ 560,731
CPC International Inc............... 8,500 452,625
Dean Foods Co....................... 12,200 353,800
Hershey Foods Corp.................. 7,340 355,073
Hormel (George A.) & Co............. 18,700 462,825
Wrigley (Wm.) Jr. Co................ 9,200 454,250
-------------
$ 2,639,304
-------------
MACHINERY & EQUIPMENT -- 3.7%
Briggs & Stratton Corp.............. 11,000 $ 360,250
Donaldson Co., Inc.................. 15,800 373,275
Dover Corp.......................... 8,000 413,000
Nordson Corp........................ 7,200 432,000
Pitney-Bowes Inc.................... 10,200 323,850
-------------
$ 1,902,375
-------------
METAL PRODUCERS -- 0.8%
Worthington Industries.............. 20,450 $ 409,000
-------------
METAL PRODUCTS MANUFACTURERS -- 3.0%
CLARCOR............................. 17,300 $ 367,625
Crown Cork & Seal Inc*.............. 10,700 403,925
Illinois Tool Works Inc............. 10,300 450,625
Stanley Works....................... 8,900 318,175
-------------
$ 1,540,350
-------------
OIL, GAS, COAL & RELATED SERVICES-- 0.9%
Exxon Corp.......................... 7,200 $ 437,400
-------------
PAPER -- 1.3%
Kimberly-Clark...................... 6,800 $ 343,400
Sonoco Products Co.................. 15,100 330,313
-------------
$ 673,713
-------------
PRINTING & PUBLISHING -- 3.6%
American Business Products.......... 16,000 $ 356,000
Banta Corp.......................... 10,500 317,625
Donnelley (R.R.) & Sons............. 14,200 418,900
Gannett Co. Inc..................... 7,200 383,400
Knight-Ridder Inc................... 6,900 348,450
-------------
$ 1,824,375
-------------
RECREATION -- 2.3%
Bob Evans Farms..................... 17,200 $ 352,600
Carnival Cruise Class A............. 19,200 408,000
McDonald's Corp..................... 15,000 438,750
-------------
$ 1,199,350
-------------
RETAILERS -- 9.8%
Albertson's Inc..................... 15,600 $ 452,400
Blair Corporation................... 8,500 340,000
Casey's General Stores, Inc......... 26,000 390,000
Circuit City Stores Inc............. 18,100 402,725
Dollar General Corp................. 16,312 489,360
Giant Food Inc...................... 14,900 324,075
Hannaford Brothers Co............... 17,500 444,063
May Department Stores............... 9,300 313,875
Nordstrom Inc....................... 9,500 399,000
Pep Boys-M. M. & M. (The)........... 15,400 477,400
Rite Aid Corp....................... 20,600 481,525
Winn-Dixie.......................... 9,800 503,475
-------------
$ 5,017,898
-------------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
TRANSPORTATION -- 2.1%
Air Express International Corp...... 19,500 $ 390,000
Arnold Industries................... 16,900 350,675
Comair Holdings, Inc................ 18,000 315,000
-------------
$ 1,055,675
-------------
UTILITIES -- COMMUNICATIONS -- 3.3%
Alltel Corp......................... 15,100 $ 454,888
AmeriTech Corp...................... 10,000 403,750
Century Telephone Enterprises....... 14,700 433,650
Southwestern Bell Corp.............. 9,600 387,600
-------------
$ 1,679,888
-------------
UTILITIES -- ELECTRIC POWER -- 3.2%
Black Hills......................... 18,000 $ 384,750
Duke Power Company.................. 10,700 407,937
TECO Energy, Inc.................... 20,500 412,563
Wisconsin Energy Corp............... 17,150 443,756
-------------
$ 1,649,006
-------------
UTILITIES-- ELECTRIC POWER HOLDING-- 0.7%
Central & South West Corp........... 16,700 $ 377,838
-------------
MISCELLANEOUS -- 8.0%
Automatic Data Processing Inc....... 7,800 $ 456,300
Block (H & R) Inc................... 11,100 412,087
Cintas Corp......................... 13,400 475,700
Crawford and Co..................... 22,900 366,400
Dionex Corporation*................. 9,200 347,300
Genuine Parts Co.................... 11,900 428,400
Interpublic Group Cos. Inc.......... 12,700 407,986
Leggett & Platt Inc................. 8,800 308,000
Newell Co........................... 18,000 378,000
Pacificare Health Systems*.......... 7,800 514,800
-------------
$ 4,094,973
-------------
TOTAL EQUITY INTERESTS -- 92.7%
(identified cost, $43,675,674) $ 47,358,850
-------------
RESERVE FUNDS -- 7.1%
Face Amount
------------
American Express Corp., 5.759%,
1/09/95..........................$1,770,000 $ 1,770,000
General Electric Capital Corp., 5.441%,
1/03/95...........................$1,865,000 1,865,000
TOTAL RESERVE FUNDS, -------------
at amortized cost $ 3,635,000
-------------
TOTAL INVESTMENTS -- 99.8%
(identified cost, $47,310,674) $ 50,993,850
OTHER ASSETS,
LESS LIABILITIES -- 0.2% 90,806
-------------
NET ASSETS-- 100% $ 51,084,656
=============
</TABLE>
* Non-income-producing security.
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
WRIGHT QUALITY CORE EQUITIES FUND
================================================================================
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1994
--------------------------------------------------------------------------------
<S> <C>
ASSETS:
Investments --
Identified cost.................................. $ 47,310,674
Unrealized appreciation.......................... 3,683,176
-------------
Total Value (Note 1A).......................... $ 50,993,850
Cash............................................... 787
Receivable for fund shares sold.................... 10,955
Dividends and interest receivable.................. 110,471
-------------
Total Assets..................................... $ 51,116,063
-------------
LIABILITIES:
Payable for fund shares reacquired................. $ 21,753
Trustee fees payable............................... 312
Custodian fee payable.............................. 7,616
Accrued expenses and other liabilities............. 1,726
-------------
Total Liabilities................................ $ 31,407
-------------
NET ASSETS............................................ $ 51,084,656
=============
NET ASSETS CONSIST OF:
Proceeds from sales of shares (including the
market value of securities received in exchange
for Fund shares and shares issued to share-
holders in payment of distributions declared),
less cost of shares reacquired................... $ 47,208,714
Unrealized appreciation of investments
(computed on the basis of identified cost)......... 3,683,176
Undistributed net investment income................ 192,766
-------------
Net assets applicable to
outstanding shares............................. $ 51,084,656
=============
SHARES OF BENEFICIAL INTEREST
OUTSTANDING..................................... 4,485,312
=============
NET ASSET VALUE, OFFERING PRICE,
AND REDEMPTION PRICE PER SHARE
OF BENEFICIAL INTEREST........................... $11.39
=============
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
For the Year Ended December 31, 1994
--------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME:
Income --
Dividends........................................ $ 1,740,963
Interest......................................... 67,255
-------------
Total Income................................... $ 1,808,218
-------------
Expenses --
Investment Adviser fee (Note 2).................. $ 332,192
Administrator fee (Note 2)....................... 147,641
Compensation of trustees not affiliated with
the Investment Adviser or Administrator........ 2,151
Custodian fee (Note 2)........................... 32,641
Transfer and dividend disbursing agent fees..... 14,012
Distribution expenses (Note 3)................... 147,641
Audit services................................... 28,250
Legal services................................... 1,833
Registration costs............................... 11,786
Printing......................................... 2,394
Interest paid on loans........................... 5,450
Miscellaneous.................................... 5,420
-------------
Total Expenses................................. $ 731,411
-------------
Net Investment Income........................ $ 1,076,807
-------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS:
Net realized gain on investment transactions
(identified cost basis).......................... $ 9,834,657
Change in unrealized appreciation
of investments................................... (11,332,016)
-------------
Net realized and unrealized gain (loss)
on investments................................... $ (1,497,359)
-------------
Net decrease in net assets
from operations.............................. $ (420,552)
=============
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
WRIGHT QUALITY CORE EQUITIES FUND
================================================================================
Year Ended
December 31,
-------------------------------------
STATEMENT OF CHANGES IN NET ASSETS 1994 1993
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income...................................................... $ 1,076,807 $ 1,187,636
Net realized gain on investment transactions............................... 9,834,657 4,083,933
Change in unrealized appreciation of investments........................... (11,332,016) (4,372,477)
-------------- ---------------
Increase (decrease) in net assets from operations..................... $ (420,552) $ 899,092
-------------- ---------------
Undistributed net investment income (loss) included in
price of shares sold and redeemed (Note 1C).................................. $ (198,337) $ 28,601
- -------------- ---------------
Distributions to shareholders --
From net investment income................................................... $ (879,992) $ (1,084,466)
From net realized gain on investment transactions............................ (4,488,457) (4,083,933)
In excess of net realized gain on investment transactions.................... (7,109) (31,540)
-------------- --------------
Total distributions to shareholders................................... $ (5,375,558) $ (5,199,939)
-------------- ---------------
Net increase (decrease) from fund share transactions (exclusive of
amounts allocated to net investment income) (Note 4)......................... $ (31,269,572) $ 10,946,442
- -------------- ---------------
Net increase (decrease) in net assets................................. $ (37,264,019) $ 6,674,196
NET ASSETS:
At beginning of year........................................................... 88,348,675 81,674,479
-------------- ---------------
At end of year................................................................. $ 51,084,656 $ 88,348,675
============== ==============
UNDISTRIBUTED NET INVESTMENT INCOME INCLUDED IN NET ASSETS.......................... $ 255,021 $ 256,543
============== ===============
</TABLE>
See notes to financial statements
<PAGE>
THE WRIGHT MANAGED EQUITY TRUST
NOTES TO FINANCIAL STATEMENTS
================================================================================
(1) SIGNIFICANT ACCOUNTING POLICIES
The Wright Managed Equity Trust (the "Trust"), issuer of Wright Selected
Blue Chip Equities Fund (WBC) series, Wright Junior Blue Chip Equities Fund
(WJBC) series, Wright Quality Core Equities Fund (WQC) series and Wright
International Blue Chip (WIBC) series, is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end, management
investment company. WIBC's financial statements have been prepared separately.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
A. Investment Valuations - Securities listed on securities exchanges or in the
NASDAQ National Market are valued at closing sale prices. Unlisted or
listed securities for which closing sale prices are not available are
valued at the mean between the latest bid and asked prices. Short-term
obligations maturing in sixty days or less are valued at amortized cost,
which approximates value. Securities for which market quotations are
unavailable are appraised at their fair value as determined in good faith
by or at the direction of the Trustees.
B. Federal Taxes - The Trust's policy is to comply with the provisions of the
Internal Revenue Code (the Code) available to regulated investment
companies and distribute to shareholders each year all of its taxable
income, including any net realized gain on investments. Accordingly, no
provision for federal income or excise tax is necessary.
C. Equalization - The Funds follow the accounting practice known as
equalization by which a portion of the proceeds from sales and costs of
reacquisitions of Fund shares, equivalent on a per-share basis to the
amount of undistributed net investment income on the date of the
transaction, is credited or charged to undistributed net investment income.
As a result, undistributed net investment income per share is unaffected by
sales or reacquisitions of Fund shares.
D. Distributions - The Trust requires that differences in the recognition or
classification of income between the financial statements and tax earnings
and profits which result in temporary overdistributions for financial
statement purposes, are classified as distributions in excess of net
investment income or accumulated net realized gains. At December 31, 1994,
WQC recharacterized $62,255 of capital gain distributions to distributions
from net investment income. WJBC recharacterized $295,169 of distributions
from net investment income to distributions from capital gains. In
addition, permanent differences of $5,346,200 and $766,787 for WQC and
WJBC, respectively, were reclassified from net realized gain on investment
transactions to paid-in capital. These differences were a result of
redemption-in-kind transactions.
E. Other - Investment transactions are accounted for on the date the
investments are purchased or sold. Dividend income and distributions to
shareholders are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis.
(2) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The Trust has engaged Wright Investors' Service (Wright) to perform
investment management, investment advisory, and other services. For its
services, Wright is compensated based upon a percentage of average daily net
assets which rate is adjusted as average daily net assets exceed certain levels.
For the year ended December 31, 1994, the effective annual rate was 0.62% for
WBC, 0.55% for WJBC, and 0.45% for WQC. The Trust also has engaged Eaton Vance
Management (Eaton Vance) to act as administrator of the Trust. Under the
Administration Agreement, Eaton Vance is responsible
<PAGE>
THE WRIGHT MANAGED EQUITY TRUST
NOTES TO FINANCIAL STATEMENTS - continued
================================================================================
for managing the business affairs of the Trust and is compensated based upon a
percentage of average daily net assets which rate is reduced as average daily
net assets exceed certain levels. For the year ended December 31, 1994, the
effective annual rate was 0.13% for WBC, 0.20% for WJBC and 0.20% for WQC.
Except as to Trustees of the Trust who are not affiliated with Eaton Vance or
Wright, Trustees and officers receive remuneration for their services to
the Trust out of the fees paid to Eaton Vance and Wright. The custodian fee
was paid to Investors Bank & Trust Company (IBT), an affiliate of Eaton Vance,
for its services as custodian of the Trust. Pursuant to the custodian
agreement, IBT receives a fee reduced by credits which are determined
based on the average daily cash balances the Trust maintains with IBT.
Certain of the Trustees and officers of the Trust are Trustees or officers
of the above organizations. See Note 3.
(3) DISTRIBUTION EXPENSES
The Trustees have adopted a Distribution Plan (the Plan) pursuant to Rule
12b-1 of the Investment Company Act of 1940. The Plan provides that each of the
Funds will pay the Principal Underwriter, Wright Investors' Service
Distributors, Inc., a subsidiary of Wright Investors' Service, an annual rate of
2/10 of 1% of each Fund's average daily net assets for activities primarily
intended to result in the sale of each Fund's shares.
(4) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number
of full and fractional shares of beneficial interest (without par value).
Transactions in Fund shares were as follows:
<TABLE>
<CAPTION>
Year Ended December 31,
--------------------------------------------------------------
1994 1993
--------------------------- ------------------------------
Shares Amount Shares Amount
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
WRIGHT SELECTED BLUE CHIP EQUITIES FUND --
Sold ............................................... 5,636,130 $ 81,393,593 4,523,131 $ 65,219,268
Issued to shareholders in payment
of distributions declared.......................... 429,746 5,868,021 105,286 1,512,950
Reacquired........................................... (4,395,865) (62,193,314) (3,212,081) (46,198,210)
----------- -------------- ----------- ---------------
Net increase .................................. 1,670,011 $ 25,068,300 1,416,336 $ 20,534,008
=========== ============== ========== ===============
WRIGHT JUNIOR BLUE CHIP EQUITIES FUND --
Sold ............................................... 780,096 $ 9,079,764 1,023,432 $ 11,994,806
Issued to shareholders in payment
of distributions declared.......................... 201,483 2,267,954 271,144 3,167,595
Reacquired........................................... (3,315,481) (38,056,603) (1,113,847) (13,068,548)
----------- -------------- ----------- ---------------
Net increase (decrease)........................ (2,333,902) $ (26,708,885) 180,729 $ 2,093,853
=========== ============== ========== ===============
WRIGHT QUALITY CORE EQUITIES FUND --
Sold ............................................... 1,640,109 $ 20,229,633 2,016,941 $ 26,177,770
Issued to shareholders in payment
of distributions declared.......................... 444,758 5,046,814 399,579 5,030,154
Reacquired........................................... (4,547,757) (56,546,019) (1,570,396) (20,261,482)
----------- -------------- ----------- --------------
Net increase (decrease)........................ (2,462,890) $ (31,269,572) 846,124 $ 10,946,442
=========== ============== =========== ===============
</TABLE>
<PAGE>
THE WRIGHT MANAGED EQUITY TRUST
NOTES TO FINANCIAL STATEMENTS - continued
================================================================================
(5) INVESTMENT TRANSACTIONS
Purchases and sales of investments, other than U.S. Government securities
and short-term obligations, for the year ended December 31, 1994, were as
follows:
<TABLE>
WRIGHT SELECTED BLUE CHIP WRIGHT JUNIOR BLUE CHIP WRIGHT QUALITY CORE
EQUITIES FUND EQUITIES FUND EQUITIES FUND
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Purchases..................................... $154,613,053 $20,170,178 $38,772,261
============ =========== ===========
Sales......................................... $130,108,838 $45,167,452 $57,130,479
============ =========== ===========
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
In addition, investments for WQC and WJBC having aggregate market
values of $16,768,992 and $3,493,125, respectively, were distributed
in payment for capital stock redeemed.
(6) FEDERAL INCOME TAX BASIS OF INVESTMENT SECURITIES
The cost and unrealized appreciation (depreciation) of the investment
securities owned at December 31, 1994, as computed on a federal income tax
basis, are as follows:
<TABLE>
WRIGHT WRIGHT WRIGHT
SELECTED BLUE CHIP JUNIOR BLUE CHIP QUALITY CORE
EQUITIES FUND EQUITIES FUND EQUITIES FUND
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Aggregate cost.................................... $ 180,285,908 $ 34,143,838 $ 47,310,674
============== ============== ==============
Gross unrealized appreciation..................... $ 9,594,283 $ 3,853,319 $ 4,986,750
Gross unrealized depreciation..................... (7,555,588) (2,119,650) (1,303,574)
-------------- -------------- --------------
Net unrealized appreciation....................... $ 2,038,695 $ 1,733,669 $ 3,683,176
============== ============== ==============
------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(7) FINANCIAL INSTRUMENTS
The Trust may trade in financial instruments with off-balance sheet risk in
the normal course of its investing activities to assist in managing exposure to
various market risks. These financial instruments include written options,
forward foreign currency exchange contracts, and futures contracts and may
involve, to a varying degree, elements of risk in excess of the amounts
recognized for financial statement purposes. The Funds hold no such instruments
at December 31, 1994.
(8) LINE OF CREDIT
The Trust participates with other funds managed by Wright in a line of
credit with a bank which allows the Funds to borrow up to $20,000,000
collectively. The line of credit consists of a $5,000,000 committed facility and
a $15,000,000 uncommitted facility. Interest is charged to each Fund based on
its borrowings, at a rate equal to the bank's base rate. In addition, the funds
pay a facility fee computed at a rate of 1/4 of 1% on the unused portion of the
$5,000,000 facility. The Trust did not have any significant borrowings under the
line of credit during the year ended December 31, 1994.
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Trustees and Shareholders of
The Wright Managed Equity Trust:
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Wright Selected Blue Chip Equities Fund,
Wright Junior Blue Chip Equities Fund, and Wright Quality Core Equities Fund
(three of the four portfolios which constitute The Wright Managed Equity Trust)
as of December 31, 1994, the related statements of operations for the year then
ended, the statements of changes in net assets for the years ended December 31,
1994 and 1993, and the financial highlights for each of the years in the
five-year period ended December 31, 1994. These financial statements and
financial highlights are the responsibility of the Trust'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 the securities owned as of
December 31, 1994, by correspondence with the custodian. 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, such financial statements and financial highlights present
fairly, in all material respects, the financial position of each of the
aforementioned Portfolios of The Wright Managed Equity Trust as of December 31,
1994, the results of their operations, the changes in their net assets, and
their financial highlights for the respective stated periods in conformity with
generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
February 2, 1995
<PAGE>
APPENDIX
DESCRIPTION OF INVESTMENTS
U.S. GOVERNMENT, AGENCY AND INSTRUMENTALITY OBLIGATIONS -- U.S. Government
obligations are issued by the Treasury and include bills, certificates of
indebtedness, notes, and bonds. Agencies and instrumentalities of the U.S.
Government are established under the authority of an act of Congress and
include, but are not limited to, the Government National Mortgage Association,
the Tennessee Valley Authority, the Bank for Cooperatives, the Farmers Home
Administration, Federal Home Loan Banks, Federal Intermediate Credit Banks,
Federal Land Banks, and the Federal National Mortgage Association.
CERTIFICATES OF DEPOSIT -- are certificates issued against funds deposited
in a bank, are for a definite period of time, earn a specified rate of return,
and are normally negotiable.
BANKERS' ACCEPTANCES -- are short-term credit instruments used to finance
the import, export, transfer or storage of goods. They are termed "accepted"
when a bank guarantees their payment at maturity.
COMMERCIAL PAPER -- refers to promissory notes issued by corporations in
order to finance their short-term credit needs.
FINANCE COMPANY PAPER -- refers to promissory notes issued by finance
companies in order to finance their short-term credit needs.
CORPORATE OBLIGATIONS -- include bonds and notes issued by corporations in
order to finance longer-term credit needs.
LENDING PORTFOLIO SECURITIES
Each Equity Fund may seek to increase its income by lending portfolio
securities to broker-dealers or other institutional borrowers. Under present
regulatory policies of the Securities and Exchange Commission, such loans are
required to be secured continuously by collateral in cash, cash equivalents or
U.S. Government securities held by the Fund's custodian and maintained on a
current basis at an amount at least equal to the market value of the securities
loaned, which will be marked to market daily. Cash equivalents include
certificates of deposit, commercial paper and other short-term money market
instruments. The Fund would have the right to call a loan and obtain the
securities loaned at any time on up to five business days' notice. The Fund
would not have the right to vote any securities having voting rights during the
existence of a loan, but would call the loan
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in anticipation of an important vote to be taken among holders of the securities
or the giving or withholding of their consent on a material matter affecting the
investment.
WRIGHT QUALITY RATINGS
Wright Quality Ratings provide the means by which the fundamental criteria
for the measurement of quality of an issuer's securities can be objectively
evaluated.
Each rating is based on 32 individual measures of quality grouped into four
components: (1) Investment Acceptance, (2) Financial Strength, (3) Profitability
and Stability, and (4) Growth. The total rating is three letters and a numeral.
The three letters measure (1) Investment Acceptance, (2) Financial Strength, and
(3) Profitability and Stability. Each letter reflects a composite measurement of
eight individual standards which are summarized as A: Outstanding, B: Excellent,
C: Good, D: Fair, L: Limited, and N: Not Rated. The numeral rating reflects
Growth and is a composite of eight individual standards ranging from 0 to 20.
EQUITY SECURITIES
INVESTMENT ACCEPTANCE reflects the acceptability of a security by and its
marketability among investors, and the adequacy of the floating supply of its
common shares for the investment of substantial funds.
FINANCIAL STRENGTH represents the amount, adequacy and liquidity of the
corporation's resources in relation to current and potential requirements. Its
principal components are aggregate equity and total capital, the ratio of
invested equity capital to debt, the adequacy of net working capital, its fixed
charges coverage ratio and other appropriate criteria.
PROFITABILITY AND STABILITY measures the record of a corporation's
management in terms of (1) the rate and consistency of the net return on
shareholders' equity capital investment at corporate book value, and (2) the
profits or losses of the corporation during generally adverse economic periods,
including its ability to withstand adverse financial developments.
GROWTH per common share of the corporation's equity capital, earnings, and
dividends -- rather than the corporation's overall growth of dollar sales and
income.
These ratings are determined by specific quantitative formulae. A
distinguishing characteristic of these ratings is that The Wright Investment
Committee must review and accept each rating. The Committee may reduce a
computed rating of any company, but may not increase it.
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DEBT SECURITIES
Wright ratings for commercial paper, corporate bonds and bank certificates
of deposit consist of the two central positions of the four position
alphanumeric corporate equity rating. The two central positions represent those
factors which are most applicable to fixed income and reserve investments. The
first, Financial Strength, represents the amount, the adequacy and the liquidity
of the corporation's resources in relation to current and potential
requirements. Its principal components are aggregate equity and total capital,
the ratios of (a) invested equity capital, and (b) long-term debt, total of
corporate capital, the adequacy of net working capital, fixed-charges coverage
ratio and other appropriate criteria. The second letter represents Profitability
and Stability and measures the record of a corporation's management in terms of:
(a) the rate and consistency of the net return on shareholders' equity capital
investment at corporate book value, and (b) the profits and losses of the
corporation during generally adverse economic periods, and its ability to
withstand adverse financial developments.
The first letter rating of the Wright four-part alphanumeric corporate
rating is not included in the ratings of fixed income securities since it
primarily reflects the adequacy of the floating supply of the company's common
shares for the investment of substantial funds. The numeric growth rating is not
included because this element is identified only with equity investments.
A-1 AND P-1 COMMERCIAL PAPER RATINGS
BY STANDARD & POOR'S AND MOODY'S
A Standard & Poor's Commercial Paper Rating is a current assessment of the
likelihood of timely payment of debt having an original maturity of no more than
365 days.
`A': Issues assigned this highest rating are regarded as having the
greatest capacity for timely payment. Issues in this category are delineated
with the numbers 1, 2, and 3 to indicate the relative degree of safety. The
`A-1' designation indicates that the degree of safety regarding timely payment
is either overwhelming or very strong. Those issues determined to possess
overwhelming safety characteristics will be denoted with a plus (+) sign
designation.
The commercial paper rating is not a recommendation to purchase or sell a
security. The ratings are based on current information furnished to Standard &
Poor's by the issuer or obtained from other sources it considers reliable. The
ratings may be changed, suspended or withdrawn as a result of changes in or
unavailability of such information.
Issuers (or related supporting institutions) rated P-1 by Moody's have a
superior capacity for repayment of short-term promissory obligations. P-1
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repayment capacity will normally be evidenced by the following characteristics:
-- Leading market positions in well-established industries.
-- High rates of return on funds employed.
-- Conservative capitalization structures with moderate reliance on
debt and ample asset protection.
-- Broad margins in earnings coverage of fixed financial charges and
high internal cash generation.
-- Well-established access to a range of financial markets and
assured sources of alternate liquidity.
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