GIT Equity Trust
Special Growth Portfolio
Select Growth Portfolio
Equity Income Portfolio
Annual Report
March 31, 1996/Audited
GIT
GIT Investment Funds
<PAGE>
Management's Discussion of Fund Performance
May 20, 1996
Dear Fellow Shareholder:
Driven by strong growth in corporate earnings, low inflation, and
declining interest rates, returns from U.S. equities for the year
ended March 31, 1996 were exceptional. The S&P 500 returned 32.2%
during this period, more than double the average annual total
return for the last ten years. Across a wide range of industries,
U.S. companies are positioned well to benefit from the growth of
the global economy, and the stock market acknowledged this trend
with 1995's broad based rally.
For the year ended March 31, 1996, the Select Growth Portfolio
returned 31.6%, which places it in the top third of all domestic
growth funds, as compiled by Morningstar, Inc. The portfolio's
returns were driven by core holdings in the technology and
financial sectors, including Cisco Systems and Green Tree
Financial. Both these sectors offer companies with high operating
margins and return on equity, robust earnings growth, and
excellent balance sheets, and we believe that they will continue
to grow at a faster rate than the economy as a whole.
Select Growth's performance for the past six months has been
dragged down somewhat by the semiconductor sector, which remained
weak through the end of March. We used the sharp price declines
in semiconductor capital equipment stocks in January and March to
accumulate shares of several companies at depressed levels.
The more conservative Equity Income Portfolio returned 27.6% for
the year ended March 31, 1996, placing it in the top 36% of all
equity income funds, as compiled by Morningstar, Inc. The
portfolio achieved this return while maintaining a high degree of
price stability. Several of the fund's largest holdings, such as
Monsanto, Williams Companies, and Federal Home Loan Mortgage
Association, grew earnings to record levels. The portfolio's high
dividend paying equities also benefited from declining interest
rates during the period of this report. Although interest rates
have recently reversed this trend and headed upwards, the Equity
Income Portfolio appears well positioned to benefit from an
easing of inflationary concerns.
The Special Growth Portfolio's one year total return of 21.2% was
its best since 1991. Throughout the fiscal year, the portfolio
achieved its returns with a high degree of price stability
relative to other small company funds. As we announced in
December, this portfolio is now managed by the same team as the
Select Growth and Equity Income portfolios. The new management
is placing a higher emphasis on rapid earnings growth than was
applied to this portfolio in the past. This shift in emphasis has
already begun to yield positive results. As of May 20, 1996, the
Special Growth Portfolio has returned 11.7% in 1996, ahead of the
S&P 500.
In closing, while we are pleased with the results of the past
year, our focus continues to be on the future, and on identifying
the best investment opportunities for the coming years. We thank
you for your continued confidence in GIT Investment Funds.
Sincerely,
A. Bruce Cleveland
President
<PAGE>
Management's Discussion of Fund Performance (continued)
Comparison of Changes in the Value of a $10,000 Investment
and the S&P 500
Depicted herein is a graphic presentation consisting of two
charts comparing the values of a $10,000 investment made to
each of the portfolios against the S&P 500. Through the use of
line graphs, the following information is presented:
Value (as of March 31, 1996) of a $10,000 investment made on
March 31, 1986 in the Special Growth Portfolio: $23,826.
Average Annual Total Returns:
1 year - 21.22 percent
5 year - 9.59 percent
10 year - 9.07 percent.
Value (as of March 31, 1996) of a $10,000 investment made on
March 31, 1986 in the Select Growth Portfolio: $25,434.
Average Annual Total Returns:
1 year - 31.63 percent
5 year - 9.01 percent
10 year - 9.79 percent.
Value (as of March 31, 1996) of a $10,000 investment made on
March 31, 1986 in the Equity Income Portfolio: $24,415.
Average Annual Total Returns:
1 year - 27.56 percent
5 year - 10.23 percent
10 year - 9.34 percent.
Corresponding value of the S&P 500: $36,814
Past performance is not predictive of future performance.
<PAGE>
Report of Ernst & Young LLP, Independent Auditors
To the Board of Trustees and Shareholders, Special Growth
Portfolio, Select Growth Portfolio and Equity Income Portfolio,
GIT Equity Trust:
We have audited the accompanying statements of assets and
liabilities, including the portfolios of investments, of GIT
Equity Trust (comprising, respectively, the Special Growth,
Select Growth and Equity Income Portfolios) as of March 31, 1996,
and the related statements of operations for the year then ended,
the statements of changes in net assets for each of the two years
in the period then ended, and the financial highlights for each
of the five years in the period then ended. 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
securities owned as of March 31, 1996, by correspondence with the
custodian and brokers. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the
financial position of each of the respective portfolios
constituting GIT Equity Trust at March 31, 1996, the results of
their operations for the year then ended, the changes in their
net assets for each of the two years in the period then ended,
and the financial highlights for each of the five years in the
period then ended, in conformity with generally accepted
accounting principles.
Ernst & Young LLP
Washington, DC
May 3, 1996
<PAGE>
Special Growth Portfolio
Portfolio of Investments - March 31, 1996
Number
Company of
Description Shares Value
COMMON STOCKS AND EQUIVALENTS:
94.1% of Net Assets
BUILDING AND CONSTRUCTION: 13.4%
*Central Sprinkler
Corporation Manufactures fire
sprinklers for
commercial,
industrial and
residential
properties 30,000 $ 907,500
*Koala Corporation Manufactures and
markets child
protection products 22,000 401,500
McGrath Rentcorp Leases temporary
modular offices 50,000 981,250
COMPUTER HARDWARE: 4.2%
*Adaptec, Inc. Supplies high-performance
microcomputer
input/output
products 15,000 725,625
COMPUTER SOFTWARE: 2.3%
*Datastream Systems,
Inc. Develops, markets,
sells and supports
plant-maintenance
software 10,000 221,250
*IKOS Systems, Inc. Supplies high-performance,
mixed-level hardware
and software 10,000 167,500
DATA SERVICES: 18.1%
American List
Corporation Compiles computerized
lists of high school
and college students 46,400 1,461,600
*CUC International, Inc. Operates database programs
that provide marketing
services to members 7,000 204,750
*Data Research
Associates, Inc. Provides libraries with
automation systems
and electronic networking
services 28,000 577,500
Fair Issac & Company,
Inc. Develops statistical tools
and scoring
algorithms 20,000 612,500
*IPC Information
Systems, Inc. Designs, manufactures,
markets and services
telecommunications
systems 10,000 231,250
FINANCIAL SERVICES: 9.2%
Advanta Corporation Originates credit cards
and mortgages 17,000 881,875
Green Tree Financial
Corporation Originates conditional
sales contracts for
manufactured homes 20,000 687,500
GAMING EQUIPMENT: 1.0%
*Paul-Son Gaming
Corporation Manufactures gaming
tables and related
supplies 20,000 178,750
HEALTHCARE INFORMATION SYSTEMS: 0.8%
*Physician Computer
Network, Inc. Publishes and licenses
medical practice management
software products 10,000 137,500
INSURANCE: 11.5%
Amwest Insurance Group,
Inc. Underwrites surety
bonds 45,000 635,625
Frontier Insurance
Group, Inc. Underwrites general
liability, workers'
compensation and property
insurance 25,000 765,625
*20th Century Industries Markets auto insurance on
the west coast 33,900 567,825
MEDICAL SUPPLIES: 4.8%
*Utah Medical Products,
Inc. Manufactures disposable
medical products 49,000 826,875
See Notes to Portfolios of Investments
<PAGE>
Special Growth Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Number
Company of
Description Shares Value
OFFICE PRODUCTS: 2.7%
Newell Company Manufactures and markets
consumer hardware and
housewares 17,000 $454,750
OILFIELD EQUIPMENT: 2.9%
*Input/Output, Inc. Designs and manufactures
3-dimensional seismic
data acquisition
systems 16,200 502,200
REAL ESTATE: 5.0%
BRE Properties, Inc. Real estate investment
trust 11,400 404,700
Western Investment Real
Estate Trust West coast real estate
investment trust 40,000 445,000
RETAIL AND SPECIAL LINES: 1.0%
*Leslie's Poolmart Retails swimming pool
supplies and related
products 12,500 167,188
SEMICONDUCTORS: 8.0%
*Credence Systems
Corporation Designs, manufactures,
sells and services
automatic test
equipment 10,000 168,750
*Electroglas, Inc. Develops, produces
and services automatic
wafer probing
equipment 5,000 75,937
*KLA Instruments
Corporation Manufactures yield management
and process monitoring
systems 20,000 451,250
*Lam Research
Corporation Manufactures, markets and
services semiconductor
processing equipment 13,000 453,375
*Oak Technology, Inc. Designs, develops and markets
multimedia semiconductor and
related software 10,000 211,250
TELECOMMUNICATIONS: 6.3%
*IFR Systems, Inc. Manufactures communications
test equipment 80,000 1,080,000
TOURISM: 2.9%
Carnival Corporation,
Class A Operates cruise
ships 18,000 495,000
TOTAL COMMON STOCKS
AND EQUIVALENTS (Cost $10,998,930)= 16,083,200
REPURCHASE AGREEMENT: 4.5% of Net Assets
With Donaldson, Lufkin & Jenrette Securities
Corporation issued 3/29/96 at 5.3%, due 4/1/96,
collateralized by $790,831 in Federal National
Mortgage Association Medium-Term Notes due 3/19/03.
Total proceeds at maturity are $773,341.
(Cost $773,000) 773,000
TOTAL INVESTMENTS (Cost $11,771,930)+ $16,856,200
See Notes to Portfolios of Investments.
<PAGE>
Select Growth Portfolio
Portfolio of Investments - March 31, 1996
Number
of
Shares Value
COMMON STOCKS: 93.3% of Net Assets
AUTOMOTIVE: 3.5%
Borg-Warner Automotive, Inc. 2,500 $83,125
Chrysler Corporation 2,000 124,500
General Motors Corporation 1,000 53,250
BANKING AND FINANCIAL SERVICES: 23.7%
American Express Company 3,000 148,125
Chemical Banking Corporation 2,500 176,250
Citicorp 1,200 96,000
Countrywide Credit Industries, Inc. 5,000 110,625
Dean Witter Discover and Company 3,500 200,375
Federal National Mortgage Association 4,000 127,500
First USA, Inc. 4,000 226,500
Green Tree Financial Corporation 7,400 254,375
Merrill Lynch & Company, Inc. 1,500 91,125
Norwest Corporation 3,000 110,250
Travelers Group, Inc. 3,200 211,200
BEVERAGES - SOFT DRINKS: 1.7%
PepsiCo, Inc. 2,000 126,500
BUSINESS SERVICES: 2.7%
*American Business Information, Inc. 5,000 81,875
Olsten Corporation 3,750 120,937
CAPITAL GOODS: 3.4%
Case Corporation 1,000 50,875
Eaton Corporation 800 48,200
General Electric Company 2,000 155,750
CHEMICALS: 2.2%
Chemed Corporation 3,000 111,375
Rexene Corporation 4,000 53,500
COMPUTERS - HARDWARE AND PERIPHERALS: 8.7%
*Adaptec, Inc. 3,700 178,987
*Cisco Systems, Inc. 4,000 185,750
*Sun Microsystems, Inc. 2,000 87,625
*3Com Corporation 1,500 59,719
*U.S. Robotics Corporation 1,000 129,750
COMPUTERS - SOFTWARE AND SERVICES: 8.7%
*Applix, Inc. 2,000 70,500
*Business Objects S.A., ADR 1,000 85,500
Computer Associates International,
Inc. 2,000 143,250
Reynolds & Reynolds Company 3,500 143,500
*Sungard Data Systems, Inc. 6,000 203,250
CONSUMER PRODUCTS: 1.4%
Procter & Gamble Company 1,200 101,700
ELECTRONICS - GENERAL: 1.4%
*Teradyne, Inc. 6,000 100,500
Number
of
Shares Value
ELECTRONICS - SEMICONDUCTORS: 9.2%
*Applied Materials, Inc. 4,800 $167,100
Intel Corporation 2,000 113,625
*KLA Instruments Corporation 7,000 157,937
*Lam Research Corporation 4,000 139,500
*Ultratech Stepper, Inc. 6,000 105,000
FOREST PRODUCTS - PAPER: 1.1%
Stone Container Corporation 6,000 84,000
HOUSING AND CONSTRUCTION: 8.7%
Clayton Homes, Inc. 8,812 183,951
Continental Homes Holding Corporation 6,500 149,500
Oakwood Homes Corporation 4,200 208,425
Shelter Components Corporation 7,000 98,000
INSURANCE: 1.0%
American International Group, Inc. 750 70,219
MEDICAL SUPPLIES AND SERVICES: 4.0%
ADAC Laboratories 6,000 105,000
*Safeskin Corporation 7,000 188,125
METALS AND MINING: 1.4%
Phelps Dodge Corporation 1,500 102,937
RAILROADS: 0.9%
Union Pacific Corporation 1,000 68,625
RESTAURANTS: 1.9%
McDonald's Corporation 3,000 144,000
RETAIL-SPECIAL LINES: 3.6%
Callaway Golf Company 2,500 66,875
*General Nutrition Companies, Inc. 8,000 201,500
TELECOMMUNICATIONS: 3.9%
AT&T Corporation 1,000 61,250
*GST Telecommunications, Inc. 3,000 25,313
*Intervoice, Inc. 5,000 143,750
MCI Communications Corporation 1,900 57,594
TOTAL COMMON STOCKS
(Cost $5,298,887) 6,894,469
REPURCHASE AGREEMENT: 8.6% of Net Assets
With Donaldson, Lufkin & Jenrette Securities
Corporation issued 3/29/96 at 5.3%, due 4/1/96,
collateralized by $652,717 in Federal National
Mortgage Association Medium-Term Notes due 3/19/03.
Total proceeds at maturity are $638,282.
(Cost $638,000) 638,000
TOTAL INVESTMENTS
(Cost $5,936,887)+ $7,532,469
See Notes to Portfolios of Investments.
<PAGE>
Equity Income Portfolio
Portfolio of Investments - March 31, 1996
Number
of
Shares Value
COMMON STOCKS AND EQUIVALENTS:
92.8% of Net Assets
AUTOMOTIVE: 0.8%
Ford Motor Company 1,000 $34,375
BANKING AND FINANCIAL SERVICES: 13.5%
Bank of New York Company, Inc. 2,000 103,000
Crestar Financial Corporation 1,000 57,500
Federal Home Loan Mortgage Corporation 1,500 127,875
J.P. Morgan & Company, Inc. 1,800 149,400
NationsBank Corporation 2,000 160,250
CHEMICALS: 9.0%
Chemed Corporation 2,500 92,813
Monsanto Company 1,200 184,200
WD-40 Company 2,600 124,475
ELECTRONICS: 2.0%
Diebold, Inc. 2,250 89,156
HOUSEHOLD PRODUCTS: 3.3%
Clorox Company 1,700 146,413
INSURANCE: 4.3%
Cigna Corporation 700 79,975
St. Paul Companies, Inc. 2,000 111,000
LEASING: 2.4%
GATX Corporation 2,300 105,800
MANUFACTURING: 2.9%
Minnesota Mining & Manufacturing
Company 2,000 129,750
METALS - DIVERSIFIED: 2.3%
Phelps Dodge Corporation 1,500 102,937
NATURAL GAS: 6.0%
Tenneco, Inc. 2,000 111,750
Williams Companies, Inc. 3,046 153,442
OFFICE AND BUSINESS EQUIPMENT: 2.2%
Pitney-Bowes, Inc. 2,000 98,000
PETROLEUM: 6.4%
Amoco Corporation 2,000 144,500
Royal Dutch Petroleum Company 1,000 141,250
PHARMACEUTICALS: 4.6%
American Home Products Corporation 1,000 108,375
Pfizer, Inc. 1,400 93,800
PUBLISHING AND PRINTING: 1.4%
Dun & Bradstreet Corporation 1,000 60,625
REAL ESTATE: 2.9%
Post Properties, Inc. 1,500 48,750
Sun Communities, Inc. 3,000 81,750
Number
of
Shares Value
TELECOMMUNICATION: 13.3%
Ameritech Corporation 1,800 $98,100
Bell Atlantic Corporation 1,000 61,750
Pacific Telesis Group 2,000 55,250
Royal PTT Nederland NV, ADR 1,000 39,500
SBC Communications, Inc. 2,500 131,562
Sprint Corporation 2,000 76,000
Telecom Corporation of New Zealand
Limited, ADR 1,600 114,600
*360 Communications Company 666 15,901
TRANSPORTATION: 3.6%
CSX Corporation 2,000 91,250
Norfolk Southern Corporation 800 68,000
UTILITIES - ELECTRIC: 5.6%
Baltimore Gas and Electric Company 4,600 127,075
Central & South West Corporation 1,500 42,750
Scana Corporation 2,800 77,000
UTILITIES - GAS: 6.3%
Brooklyn Union Gas Company 3,000 80,250
Northwest Natural Gas Company 3,500 112,000
Washington Gas Light Company 4,000 87,500
TOTAL COMMON STOCKS AND EQUIVALENTS
(Cost $2,745,651) 4,119,649
PREFERRED STOCKS: 1.2% of Net Assets
Chase Manhattan Corporation,
9.08% Series J 1,000 25,875
Sears, Roebuck and Company Depository
Shares, 8.88% Series 1ST 1,000 25,438
TOTAL PREFERRED STOCKS (Cost $50,000) 51,313
REPURCHASE AGREEMENT: 5.9% of Net Assets
With Donaldson, Lufkin & Jenrette Securities
Corporation issued 3/29/96 at 5.3%, due 4/1/96
collateralized by $268,044 in Federal National
Mortgage Association Medium-Term Notes due 3/19/03.
Total proceeds at maturity are $262,116.
(Cost $262,000) 262,000
TOTAL INVESTMENTS (Cost $3,057,651)+ $4,432,962
Notes to the Portfolios of Investments:
ADR American Depository Receipt
* Non-income producing
+ Aggregate cost for federal income tax purposes and net
unrealized appreciation of investments is as follows:
Special Select Equity
Growth Growth Income
Portfolio Portfolio Portfolio
Aggregate cost $11,771,930 $5,936,887 $3,057,651
Gross unrealized
appreciation $5,609,882 $1,906,083 $1,375,311
Gross unrealized
depreciation 525,612 310,501 0
Net unrealized
appreciation $5,084,270 $1,595,582 $1,375,311
The Notes to Financial Statements are an integral part of these
statements.
<PAGE>
Statements of Assets and Liabilities
March 31, 1996
Special Select Equity
Growth Growth Income
Portfolio Portfolio Portfolio
ASSETS
Investments, at cost $11,771,930 $5,936,887 $3,057,651
Investments, at value
(Notes 1 and 2)
Investment securities $16,083,200 $6,894,469 $4,170,962
Repurchase agreement 773,000 638,000 262,000
Total investments 16,856,200 7,532,469 4,432,962
Cash 598 786 714
Receivables
Investment securities sold 523,125 -- --
Share subscriptions 50 50 4,000
Dividends and interest 6,542 6,145 11,077
Other assets 71 9 28
Total assets 17,386,586 7,539,459 4,448,781
LIABILITIES
Payables
Investment securities
purchased -- 142,125 --
Dividends 3 -- --
Capital shares redeemed 295,268 2,321 5,243
Shares reserved for
subscription 50 50 4,000
Other liabilities 261 6,297 22
Total liabilities 295,582 150,793 9,265
NET ASSETS (Note 5) $17,091,004 $7,388,666 $4,439,516
CAPITAL SHARES OUTSTANDING 834,197 336,008 229,674
NET ASSET VALUE PER SHARE $20.488 $21.990 $19.330
Statements of Operations
For the Year Ended March 31, 1996
Special Select Equity
Growth Growth Income
Portfolio Portfolio Portfolio
INVESTMENT INCOME (Note 1)
Interest income $196,272 $32,401 $15,225
Dividend income (net of
foreign tax of $0, $238,
and $2,075, respectively) 379,969 57,839 146,764
Total investment income 576,241 90,240 161,989
EXPENSES (Notes 3 and 4)
Investment advisory fee 219,111 44,041 29,875
Custodian fees 10,028 2,659 1,969
Professional fees 22,933 8,037 6,879
Salaries and related expenses 94,597 25,150 18,645
Securities registration
and blue sky expenses 7,913 6,565 5,757
Telephone expense 5,737 1,535 1,135
Data processing and office
equipment expenses 30,408 9,908 7,232
Office and miscellaneous
expenses 19,161 6,801 4,689
Depreciation and amortization 2,706 711 528
Total expenses 412,594 105,407 76,709
NET INVESTMENT INCOME (LOSS) 163,647 (15,167) 85,280
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS
Net realized gain on
investments 7,936,809 370,742 26,354
Net unrealized appreciation
(depreciation) of
investments (2,310,916) 1,182,208 851,075
NET GAIN ON INVESTMENTS 5,625,893 1,552,950 877,429
TOTAL INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $5,789,540 $1,537,783 $962,709
The Notes to Financial Statements are an integral part of these
statements.
<PAGE>
Statements of Changes in Net Assets
For the Years Ended March 31
Special Growth Portfolio
1996 1995
INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS
Net investment income (loss) $163,647 $266,540
Net realized gain on investments 7,936,809 2,872,581
Net unrealized appreciation
(depreciation) of investments (2,310,916) (2,105,062)
Total increase in net assets
resulting from operations 5,789,540 1,034,059
NET EQUALIZATION CREDIT (Note 1) -- --
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (148,514) (266,540)
From net capital gains (1,629,234) (5,447,258)
CAPITAL SHARE TRANSACTIONS (Note 7) (18,510,504) 1,337,943
TOTAL INCREASE (DECREASE)IN NET ASSETS (14,498,712) (3,341,796)
NET ASSETS
Beginning of year 31,589,716 34,931,512
End of year $17,091,004 $31,589,716
UNDISTRIBUTED NET INVESTMENT INCOME
INCLUDED IN NET ASSETS AT THE END
OF YEAR (Note 5) $15,132 --
Select Growth Portfolio
1996 1995
INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS
Net investment income (loss $(15,167) $(8,924)
Net realized gain on investments 370,742 445,885
Net unrealized appreciation
(depreciation) of investments 1,182,208 (216,078)
Total increase in net assets
resulting from operations 1,537,783 220,883
NET EQUALIZATION
CREDIT (Note 1) -- --
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income -- --
From net capital gains -- (455,760)
CAPITAL SHARE TRANSACTIONS (Note 7) 1,102,287 223,748
TOTAL INCREASE (DECREASE) IN NET ASSETS 2,640,070 (11,129)
NET ASSETS
Beginning of year 4,748,596 4,759,725
End of year $7,388,666 $4,748,596
UNDISTRIBUTED NET INVESTMENT INCOME
INCLUDED IN NET ASSETS AT THE END
OF YEAR (Note 5) -- --
Equity Income Portfolio
1996 1995
INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS
Net investment income (loss) $85,280 $88,298
Net realized gain on investments 26,354 65,516
Net unrealized appreciation (depreciation)
of investments 851,075 47,919
Total increase in net assets resulting
from operations 962,709 201,733
NET EQUALIZATION
CREDIT (Note 1) 133 (427)
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (66,947) (111,973)
From net capital gains -- (170,493)
CAPITAL SHARE TRANSACTIONS (Note 7) 131,112 (130,962)
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,027,007 (212,122)
NET ASSETS
Beginning of year 3,412,509 3,624,631
End of year $4,439,516 $3,412,509
UNDISTRIBUTED NET INVESTMENT INCOME
INCLUDED IN NET ASSETS AT THE END
OF YEAR (Note 5) $18,466 --
The Notes to Financial Statements are an integral part of these
statements.
<PAGE>
Financial Highlights
Selected data for a share outstanding throughout each year:
1992 1993 1994 1995 1996
Special Growth Portfolio
Net asset value
beginning of
year $18.047 $19.099 $19.970 $21.110 $18.092
Net investment
income $ 0.175 $ 0.092 $ 0.171 $ 0.152 $ 0.133
Net realized &
unrealized
gains
(losses) on
securities $ 1.245 $ 1.031 $ 2.125 $ 0.190 $ 3.621
Total from
investment
operations $ 1.420 $ 1.123 $ 2.296 $ 0.342 $ 3.754
Distributions
from net
investment
income $(0.159) $(0.121)$(0.170)$0.152) $(0.115)
Distributions
from capital
gains $(0.209) $(0.131)$(0.986)$(3.208) $(1.243)
Total
distribu-
tions $(0.368) $(0.252)$(1.156)$(3.360) $(1.358)
Net asset
value end
of year $19.099 $19.970 $21.110 $18.092 $20.488
Total return 7.92% 5.90% 11.57% 2.27% 21.22%
Net assets end
of year
(thousands)$58,867 $38,911 $34,931 $31,590 $17,091
Ratio of
expenses
to average
net assets 1.39% 1.35% 1.45% 1.30% 1.41%
Ratio of net
investment
income to
average net
assets 0.95% 0.44% 0.75% 0.76% 0.56%
Portfolio
turnover 24% 13% 7% 4% 21%
Select Growth Portfolio
Net asset value
beginning of
year $18.884 $19.670 $18.486 $17.706 $16.706
Net investment
income $ 0.268 $ 0.137 $(0.053) $(0.032) $(0.045)
Net realized &
unrealized
gains
(losses) on
securities $ 0.736 $ 1.410 $(0.318) $ 0.741 $ 5.329
Total from
investment
operations $1.004 $ 1.547 $(0.371) $0.709 $5.284
Distributions
from net
investment
income $(0.218) $(0.175) $(0.007) -- --
Distributions
from capital
gains -- $(2.556) $(0.402) $(1.709) --
Total
distribu-
tions $(0.218) $(2.731) $(0.409) $(1.709) --
Net asset
value end
of year $19.670 $18.486 $17.706 $16.706 $21.990
Total return 5.28% 8.45% (2.05)% 4.55% 31.63%
Net assets end
of year
(thousands)$5,483 $5,742 $4,760 $4,749 $7,389
Ratio of
expenses
to average
net assets 2.00% 2.00% 2.02% 1.90% 1.79%
Ratio of net
investment
income to
average net
assets 1.44% 0.70% (0.27)% (0.19)% (0.26)%
Portfolio
turnover 60% 125% 48% 82% 56%
Equity Income Portfolio
Net asset value
beginning of
year $14.805 $15.117 $16.814 $15.809 $15.411
Net investment
income $ 0.499 $ 0.416 $ 0.382 $ 0.504 $ 0.373
Net realized &
unrealized
gains
(losses) on
securities $ 0.203 $ 1.961 $(0.543) $ 0.364 $ 3.839
Total from
investment
operations $ 0.702 $ 2.377 $(0.161) $ 0.868 $ 4.212
Distributions
from net
investment
income $(0.390) $(0.449) $(0.352) $(0.504)$(0.293)
Distributions
from capital
gains -- $(0.231) $(0.492) $(0.762) --
Total
distribu-
tions $(0.390) $(0.680) $(0.844) $(1.266) $(0.293)
Net asset
value end
of year $15.117 $16.814 $15.809 $15.411 $19.330
Total return 4.74% 16.11% (1.08)% 6.04% 7.56%
Net assets end
of year
(thousands)$2,838 $3,315 $3,625 $3,413 $4,440
Ratio of
expenses
to average
net assets 2.15% 2.19% 2.17% 2.07% 1.92%
Ratio of net
investment
income to
average net
assets 3.47% 2.58% 2.27% 2.53% 2.13%
Portfolio
turnover 32% 55% 34% 29% 7%
The Notes to Financial Statements are an integral part of
these statements.
GIT Equity Trust
Notes to Financial Statements
March 31, 1996
1. Summary of Significant Accounting Policies. GIT Equity Trust
(the "Trust") is registered with the Securities and Exchange
Commission under the Investment Company Act of 1940 as an open-
end, diversified investment management company. The Trust offers
shares in four separate portfolios which invest in differing
securities . The Special Growth Portfolio is invested primarily
in smaller companies that may offer rapid growth potential. The
Select Growth Portfolio is invested primarily in established
companies that may be undervalued or may offer good management
and significant growth potential. The Equity Income Portfolio is
invested primarily in relatively stable, high-yielding
securities. The Worldwide Growth Portfolio invests primarily in
foreign equity securities emphasizing companies that are likely
to benefit from the growth of the world's smaller and emerging
capital markets. The Worldwide Growth Portfolio issues separate
semi-annual and annual financial reports to shareholders.
Securities Valuation: Securities traded on a national
securities exchange are valued at their closing sale price,
if
<PAGE>
Notes to Financial Statements (continued)
available, and if not available such securities are valued at the
mean between their bid and asked prices. Other securities, for
which current market quotations are readily available, are valued
at the mean between their bid and asked prices. Securities for
which current market quotations are not readily available are
valued at their fair value as determined in good faith by the
Trustees. Investment transactions are recorded on the trade date.
The cost of investments sold is determined on the identified cost
basis for financial statement and federal income tax purposes.
Repurchase agreements are valued at amortized cost, which
approximates market value.
Investment Income: Interest and other income (if any) is accrued
as earned. Dividend income is recorded on the ex-dividend date.
Dividends: Substantially all of the Trust's accumulated net
investment income, if any, determined as gross investment income
less accrued expenses, is declared as a regular dividend and
distributed to shareholders at least twice annually at calendar
and fiscal year ends. The Trust intends to declare and pay
regular Equity Income Portfolio dividends quarterly. Capital
gains distributions reflecting net realized gains of each
portfolio (if any) are declared and paid twice annually at
calendar and fiscal year end. Additional distributions will be
made if necessary.
Income Tax: In accordance with the provisions of Subchapter M of
the Internal Revenue Code applicable to regulated investment
companies, all of the taxable income of each portfolio is
distributed to its shareholders, and therefore no federal income
tax provision is required. As of March 31, 1996, the Equity
Income Portfolio had available for federal income tax purposes
unused capital loss carryovers of $26,296 expiring March 31,
2004.
Equalization: The Trust uses an accounting practice known as
equalization for the Equity Income Portfolio, by which a portion
of the proceeds from sales and costs of redemption of capital
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 redemptions of capital
shares.
Share Subscriptions: Shares purchased by check or otherwise not
paid for in immediately available funds are accounted for as
share subscriptions receivable and shares reserved for
subscriptions.
Use of Estimates: The preparation of the financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and reported amounts
of increases and decreases in net assets from operations during
the reporting period. Actual results could differ from those
estimates.
2. Investments in Repurchase Agreements. When the Trust
purchases securities under agreements to resell, the securities
are held for safekeeping by the Trust's custodian bank as
collateral. Should the market value of the securities purchased
under such an agreement decrease below the principal amount to be
received at the termination of the agreement plus accrued
interest, the counterparty is required to place an equivalent
amount of additional securities in safekeeping with the Trust's
custodian bank. Repurchase agreements may be terminated within
seven days. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Trust, along with other
registered investment companies having Advisory and Services
Agreements with Bankers Finance Investment Management Corp.
("BFIMC"), transfers uninvested cash balances into a joint
trading account. The aggregate balance in this joint trading
account is invested in one or more consolidated repurchase
agreements whose underlying securities are U.S. Treasury or
federal agency obligations.
3. Investment Advisory Fees and Other Transactions with
Affiliates. The Investment Adviser to the Trust, BFIMC, earns an
advisory fee equal to 0.75% per annum of the average net assets
of each of the Special Growth, Select Growth and Equity Income
Portfolios; the fees accrue daily and are payable monthly. BFIMC
had retained Cramblit & Carney, Incorporated, investment
counselors, as a sub-adviser with respect to the Special Growth
Portfolio. For the
<PAGE>
Notes to Financial Statements (continued)
year ended March 31, 1996, the sub-adviser received fees from
BFIMC of $90,238. The sub-advisory agreement was terminated as of
the close of business on December 31, 1995. In order to meet the
securities registration requirements of certain states, BFIMC has
undertaken to reimburse the Trust by the amount, if any, by which
the total expenses of the Trust (less certain excepted expenses)
exceed the applicable expense limitation in any state or other
jurisdiction in which the Trust is subject to regulation during
the fiscal year. The Trust believes the current applicable
expense limitation is 2.5% per annum of the average net assets
of each portfolio up to $30 million, 2% of any amount of such
net assets exceeding $30 million but not exceeding $100 million,
and 1.5% per annum of such amount in excess of $100 million.
BFIMC is responsible for the fees and expenses of trustees who
are affiliated with BFIMC, the rent expense of the Trust's
principal executive office premises and certain promotional
expenses. For the year ended March 31, 1996, outside trustee fees
were $3,250 for each portfolio. At March 31, 1996, certain
officers, trustees, companies and individuals affiliated with the
Trust have investments in the Trust aggregating 1.2% of the
Special Growth Portfolio shares outstanding, 0.9% of the Select
Growth Portfolio shares outstanding and 0.2% of the Equity Income
Portfolio shares outstanding.
4. Other Expenses. With the exception of certain expenses of the
Trust payable by it directly, all operational support services
are provided to the Trust under a services agreement between the
Trust and BFIMC, pursuant to which such services are to be
provided for amounts not exceeding the cost to BFIMC of the
support provided. Common expenses incurred by the Trust are
allocated among the portfolios based on the ratio of net assets
of each portfolio to the combined net assets. For the year
ended March 31, 1996, operating expenses of $193,483 for the
Special Growth Portfolio, $61,366 for the Select Growth
Portfolio, and $46,834 for the Equity Income Portfolio have been
reimbursed to BFIMC under the Services Agreement. As of March
31, 1996, expenses of $1,277 for the Special Growth Portfolio,
$10,817 for the Select Growth Portfolio, and $38,046 for the
Equity Income Portfolio have been incurred by BFIMC on behalf of
the portfolios, the billings of which have been deferred.
5. Net Assets. At March 31, 1996, net assets included the
following:
Special Growth Select Growth Equity Income
Portfolio Portfolio Portfolio
Net paid in capital
on shares of
beneficial
interest $5,684,027 $5,433,320 $3,072,035
Undistributed net
investment income 15,132 -- 18,466
Accumulated net
realized gains
(losses) 6,307,575 359,764 (26,296)
Net unrealized
appreciation of
investments 5,084,270 1,595,582 1,375,311
Total net assets $17,091,004 $7,388,666 $4,439,516
The Select Growth Portfolio reclassified $15,167 from accumulated
net investment losses to paid in capital as a result of permanent
book and tax basis differences. This reclassification had no
impact on net asset value.
6. Investment Transactions. Purchases and sales of securities
other than short-term securities for the year ended March 31,
1996, were as follows:
Special Growth Select Growth Equity Income
Portfolio Portfolio Portfolio
Purchases $5,299,214 $3,999,942 $322,703
Sales 21,708,608 3,052,028 242,191
<PAGE>
Notes to Financial Statements (continued)
7. Capital Share Transactions. An unlimited number of capital
shares, without par value, are authorized. Transactions in
capital shares for the years ended March 31 were as follows:
Special Growth Portfolio
1996 1995
In Dollars
Shares sold $63,271,505 $164,683,514
Shares issued in reinvestment
of dividends 1,559,202 5,232,976
Total shares issued 64,830,707 169,916,490
Shares redeemed (83,341,211) (168,578,547)
Net increase (decrease) $(18,510,504) $1,337,943
In Shares
Shares sold 3,260,611 8,581,112
Shares issued in reinvestment
of dividends 80,463 284,944
Total shares issued 3,341,074 8,866,056
Shares redeemed (4,252,958) (8,774,708)
Net increase (decrease) (911,884) 91,348
Select Growth Portfolio
1996 1995
In Dollars
Shares sold $2,853,388 $1,165,448
Shares issued in reinvestment
of dividends -- 443,606
Total shares issued 2,853,388 1,609,054
Shares redeemed (1,751,101) (1,385,306)
Net increase (decrease) $1,102,287 $223,748
In Shares
Shares sold 141,259 68,987
Shares issued in reinvestment
of dividends -- 28,074
Total shares issued 141,259 97,061
Shares redeemed (89,489) (81,565)
Net increase (decrease) 51,770 15,496
Equity Income Portfolio
1996 1995
In Dollars
Shares sold $904,364 $297,518
Shares issued in reinvestment
of dividends 59,319 269,709
Total shares issued 963,683 567,227
Shares redeemed (832,571) (698,189)
Net increase (decrease) $131,112 $(130,962)
In Shares
Shares sold 52,804 19,179
Shares issued in reinvestment
of dividends 3,417 18,114
Total shares issued 56,221 37,293
Shares redeemed (47,985) (45,132)
Net increase (decrease) 8,236 (7,839)
GIT Equity Trust
Special Tax Information (Unaudited)
March 31, 1996
Corporate shareholders should note that the percentages of
ordinary dividend income resulting from the fiscal year ended
March 31, 1996, that qualify for the corporate dividends-received
deduction are as follows:
Select Growth Portfolio 100%
Special Growth Portfolio 35%
Equity Income Portfolio 100%
Pursuant to Section 852 of the Internal Revenue Code, the Special
Growth and Select Growth Portfolios designate $7,345,286 and
$317,324, respectively, as capital gain dividends for the fiscal
year ended March 31, 1996.
<PAGE>
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<PAGE>
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<PAGE>
Telephone Numbers
Shareholder Service
Washington, DC area: 703/528-6500
Toll-free nationwide: 800/336-3063
24-Hour ACCESS
Toll-free nationwide: 800/448-4422
The GIT Family of Mutual Funds
GIT Equity Trust
Special Growth Portfolio
Select Growth Portfolio
Equity Income Portfolio
Worldwide Growth Portfolio
GIT Income Trust
Maximum Income Portfolio
Government Portfolio
GIT Tax-Free Trust
Arizona Portfolio
Maryland Portfolio
Missouri Portfolio
Virginia Portfolio
National Portfolio
Money Market Portfolio
Government Investors Trust
For more complete information on any GIT Investment Fund,
including charges and expenses, request a prospectus by
calling the numbers above. Read it carefully before you
invest or send money. This prospectus does not constitute an
offering by the distributor in any jurisdiction in which such
offering may not be lawfully made.
GIT
GIT Investment Funds
1655 Fort Myer Drive
Arlington Virginia 22209
http://www.gitfunds.com
<PAGE>
GIT Equity Trust
Worldwide Growth Portfolio
Annual Report
March 31, 1996
Management's Discussion of Fund Performance
May 10, 1996
Dear Shareholder:
Emerging market funds have found a more favorable investment
climate during the past twelve months, as evidenced by the
one year total return of 16.88% achieved by our Worldwide
Growth Portfolio. When the fiscal year began in April 1995,
emerging markets equities were just beginning to rebound
from the crisis triggered by the Mexican currency
devaluation in December 1994. During the year that followed,
the majority of the emerging markets continued a gradual
recovery, with periodic short setbacks.
Some of the most impressive turnarounds were achieved in
Asia, after major declines in the prior year. During the
year ended March 31, Hong Kong's Heng Seng Index returned
32.2% and Malaysia's KLSE Composite returned 18.5%. These
rallies were partly in response to declining interest rates
in the U.S. U.S. rates affect the Hong Kong market because
Hong Kong's currency is pegged to the U.S. dollar.
Furthermore, Malaysia's current account deficit makes its
domestic economy sensitive to international interest rates.
Since U.S. interest rates have risen considerably since
January, we have taken a more skeptical view of Hong Kong
and Malaysia, and reduced our holdings there.
Elsewhere in the Pacific region, rapid economic growth in
Thailand and Indonesia has led to a tightening of monetary
policy. While we are cautious on these markets due to the
restrictive stance by their respective central banks, we
remain enthusiastic about infrastructure-related companies
which continue to grow their earnings at double digit rates.
We are also enthusiastic about the prospects for South
Korea. Stock valuations there are among the lowest in the
region, while growth prospects are among the best. An
overweight position in South Korea hurt fund performance in
recent months, but we believe that our investments there
represent outstanding potential for long-term capital
appreciation.
In contrast to market rallies reflecting Asia's high growth
prospects, the recovery in Latin American equities has been
more tentative. In 1995, the Mexican economy experienced one
of the worst economic contractions of the 20th century, and
many companies with high levels of debt saw their share
prices collapse. At the same time, Mexican companies
involved in exports have been able to take advantage of a
weak currency to bolster sales, and we have focused on these
stocks to limit the fund's exposure to currency risk and a
sluggish domestic economy.
Stock market conditions in the rest of Latin America
continue to improve gradually. Stocks that have performed
particularly well over the past year include CPT, the
Peruvian national telecommunications concern, and Petrobras,
Brazil's state owned oil corporation. Falling behind in the
region have been smaller, less liquid private sector stocks,
as investors in recent months have preferred the more
liquid, well capitalized issues.
In recent months, we have diversified the portfolio across
more regions and countries, resulting in greater exposure to
Eastern Europe and the Middle East. Companies in Eastern
European markets such as Poland and the Czech Republic have
shown accelerated earnings growth recently, while Greece and
Turkey offer equities at low earnings per share multiples.
<PAGE>
Management's Discussion of Fund Performance (continued)
We remain optimistic that this steady recovery in emerging
markets equities has laid a foundation for continued gains.
Valuations remain at attractive levels in many markets, and
many of the blue chip companies in Asia, Eastern Europe and
elsewhere continue to grow their profits at rates faster
than comparable companies in developed countries. While we
expect periodic setbacks, we believe that our investments
are well positioned for the future.
Sincerely,
A. Bruce Cleveland
President
Comparison of change in value of $10,000 investment in the
GIT Equity Trust Worldwide Growth Portfolio and the Morgan
Stanley European Australian and Far East Index
Depicted herein is a graphic presentation consisting of two
charts comparing the values of a $10,000 investment made to
the portfolios against the Morgan Stanley European
Australian Far East Index. Through the use of a line graph,
the following information is presented:
Value (as of March 31, 1996) of a $10,000 investment made on
March 31, 1986 in the Worldwide Growth Portfolio: $11,385.
Average Annual Total Returns:
1 year - 16.88 percent
Since inception (April 16, 1993) - 4.46 percent.
Corresponding value of the Morgan Stanley European
Australian Far East Index: $12,688
Past performance is not predictive of future performance
<PAGE>
Report of Ernst & Young LLP, Independent Auditors
To the Board of Trustees and Shareholders, Worldwide Growth
Portfolio, GIT Equity Trust:
We have audited the accompanying statement of assets and
liabilities, including the portfolio of investments, of
Worldwide Growth Portfolio (one of the portfolios comprising
GIT Equity Trust) as of March 31, 1996, and the related
statement of operations for the year then ended, the
statements of changes in net assets for each of the two
years in the period then ended, and the financial highlights
for each of the two years in the period then ended and for
the period from inception (April 16, 1993) to March 31,
1994. These financial statements and financial highlights
are the responsibility of the Portfolio's management. Our
responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that we
plan and perform the audit to obtain reasonable assurance
about whether the financial statements and financial
highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of
March 31, 1996, by correspondence with the custodian and
brokers. An audit also includes assessing the accounting
principles used and significant estimates made by
management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial
highlights referred to above present fairly, in all material
respects, the financial position of Worldwide Growth
Portfolio at March 31, 1996, the results of its operations
for the year then ended, the changes in its net assets for
each of the two years in the period then ended, and the
financial highlights for each of the two years in the period
then ended and for the period from inception (April 16,
1993) to March 31, 1994, in conformity with generally
accepted accounting principles.
Ernst & Young LLP
Washington, DC
May 3, 1996
<PAGE>
Worldwide Growth Portfolio
Portfolio of Investments - March 31, 1996
Number
of
Company Description Shares Value
COMMON STOCKS:
74.0% of Net Assets
ARGENTINA: 4.8%
Inversiones y Representacion
S.A., Class B Engineering and
construction 20,576 $57,613
Telecom Argentina
Stet-France
Telecom S.A., ADR Telecommunications 500 20,750
Telefonica de Argentina
S.A., Class B Telecommunications 10,600 27,242
YPF Sociedad Anonima,
ADR Oil and gas 2,200 44,275
COLOMBIA: 1.3%
Banco Ganadero S.A.,
ADR Banking and financial
services 2,000 39,500
CZECH REPUBLIC: 2.0%
*Komercni Banka A.S.,
GDR (144A) Banking and financial
services 2,500 62,300
GREECE: 3.2%
Alpha Credit Bank Banking and financial
services 800 57,463
Athens Medical Center
S.A. Hospital management 6,000 42,350
HONG KONG/CHINA: 8.8%
Consolidated Electric
Power Asia Ltd. Electric utility 20,000 33,101
First Pacific Company
Ltd. Diversified 84,774 120,573
Guangdong Investment
Limited Diversified 46,000 29,144
HSBC Holdings Plc. Banking and financial
services 6,000 89,992
HUNGARY: 2.7%
Egis Gyogyszergyar
Reszvnytarsas A.G. Pharmaceuticals 2,000 84,992
INDIA: 2.1%
*The India Fund, Inc. Multi-industry 3,000 30,375
*The Morgan Stanley
India Investment
Fund, Inc. Multi-industry 1,500 16,688
Sanghi Polyesters Ltd.,
GDR (144A) Textiles 6,000 18,475
INDONESIA: 3.7%
P.T. Indorama
Synthetics Textiles 15,000 51,348
P.T. Pabrik Kertas
Tjiwi Kimia Forest and paper
products 23,427 22,805
P.T. Semen Cibinong Building Materials 15,000 42,362
ISRAEL: 3.0%
ECI Telecommunications
Limited Telecommunications 2,500 55,938
Koor Industries Limited,
ADR Telecommunications 2,000 38,750
MALAYSIA: 6.6%
Malaysian Assurrance
Alliance Berhad Financial Services 13,500 84,308
O.Y.L. Industries
Berhad Real Estate 8,000 69,565
Westmont Industries
Berhad Diversified 24,000 51,225
See Notes to Portfolio of Investments
<PAGE>
Worldwide Growth Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Number
of
Company Description Shares Value
MEXICO: 5.5%
Alfa, S.A. de C.V. Manufacturing 2,000 $26,551
*Cemex, S.A. de C.V.,
Series B Building materials 10,000 38,538
*Desc, S.A. de C.V.,
ADR Diversified 2,500 42,500
*Grupo Financiero
Banamex Accival
S.A. de C.V.,
Series L Banking and financial
services 10,920 21,187
Transportacion Maritima
Mexicana, S.A.
de C.V., ADR Marine transportation 5,300 43,725
PERU: 3.3%
Compania Goodyear
del Peru Rubber products 20,000 29,711
CPT Telefonica del
Peru S.A., B shares Telecommunications 36,112 72,040
POLAND: 4.7%
*Bank Gdanski S.A.,
GDR (144A) Banking and financial
services 3,500 38,500
Polifarb Wroclaw S.A. Building materials 10,000 41,747
Zaklady Przemyslu
Cukierniczego
Jutrzenka S.A. Food processing 4,000 67,105
PORTUGAL: 0.7%
Espirito Santo Financial
Holding S.A., ADR Banking and financial
services 2,000 24,000
SINGAPORE: 3.6%
Sunright Limited Electronics 80,000 84,659
Venture Manufacturing
Ltd. Electronics 8,000 28,409
SOUTH AFRICA: 4.6%
Barlow Limited, ADR Diversified 4,000 50,300
South African Breweries
Limited, ADR Brewery 1,000 31,750
The Southern Africa
Fund, Inc. Multi-industry 3,500 59,938
SOUTH KOREA: 3.8%
*Korea Housing Bank,
1st New Banking and financial
services 2,250 59,180
Samsung Electronics
Company Electronics 490 57,839
TAIWAN: 2.0%
*ROC Taiwan Fund Multi-industry 6,000 62,250
THAILAND: 2.2%
*Bangkok Bank Company
Ltd. Banking 5,800 52,352
Singer Thailand Public
Company Limited Home appliances 1,800 15,107
TURKEY: 3.8%
Erciyas Biracilik Ve
Malt Sanayii Brewery 96,000 58,231
Kerevitas Gida Foods 700,000 59,247
UNITED STATES: 0.4%
Capco Automotive
Products Corporation Automotive parts 1,000 12,375
See Notes to Portfolio of Investments
<PAGE>
Worldwide Growth Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Number
of
Company Description Shares Value
VENEZUELA: 1.2%
C.A. La Electricidad
de Caracas Electric utility 56,023 $38,416
TOTAL COMMON STOCKS (Cost $2,331,826) 2,306,791
PREFERRED STOCKS: 13.0% of Net Assets
BRAZIL: 10.8%
Companhia Acos
Especiais Itabira,
ADR Steel 5,325 60,168
*Compania Siderurgica
Paulista, Series B Steel 45,000 61,488
Petroleo Brasileiro
S.A. Oil and gas 930,000 111,073
*Randon Participacoes
S.A. Diversified 50,000,000 29,858
Telecomunicacoes
Brasileiras, S.A.,
ADR Telecommunications 1,500 74,625
SOUTH KOREA: 2.2%
Samsung Electronics
Company Electronics 940 68,142
TOTAL PREFERRED STOCKS (Cost $426,706) 405,354
CONVERTIBLE CORPORATE BONDS: 1.5% of Net Assets
PHILIPPINES: 1.5%
Bacnotan Consolidated
Industries, Inc., 5.5%,
6/21/04 (144A)
(Cost $50,000) Building materials 50,000 46,000
REPURCHASE AGREEMENT: 9.7% of Net Assets
With Donaldson, Lufkin & Jenrette Securities
Corporation issued 3/29/96 at 5.3%, due 4/1/96
collateralized by $308,966 in Federal National
Mortgage Association Medium-Term Notes due
3/19/03. Total proceeds at maturity are
$302,133. (Cost $302,000) 302,000
TOTAL INVESTMENTS (Cost $3,110,532)+ $3,060,145
Notes to the Portfolio of Investments:
* Non-income producing
+ Aggregate cost for federal income tax purposes is
$3,110,532 at March 31, 1996, and the net
unrealized depreciation is $50,387 comprised
of gross unrealized appreciation of $382,297
and gross unrealized depreciation of $432,684.
ADR American Depository Receipt
GDR Global Depository Receipt
144A Securities exempt from registration under Rule 144A of
the Securities Act of 1933. These securities may be
resold in transactions exempt from registration,
normally to qualified institutional buyers.
At March 31, 1996 these securities amounted to
$165,275 or 5.3% of net assets.
The Notes to Financial Statements are an integral part of
these statements.
<PAGE>
Worldwide Growth Portfolio
Statement of Assets and Liabilities
March 31, 1996
ASSETS
Investments, at cost $3,110,532
Investments, at value (Notes 1 and 2)
Investment securities 2,758,145
Repurchase agreement 302,000
Total investments 3,060,145
Cash and foreign currency 2,184
Receivables
Investment securities sold 57,856
Dividends and interest 10,778
Other assets 2
Total assets 3,130,965
LIABILITIES
Payables
Capital shares redeemed 8,908
Investment securities purchased 6,324
Other liabilities 24
Total liabilities 15,256
NET ASSETS (Note 5) $3,115,709
CAPITAL SHARES OUTSTANDING 315,944
NET ASSET VALUE PER SHARE $9.862
Worldwide Growth Portfolio
Statement of Operations
For the Year Ended March 31, 1996
INVESTMENT INCOME (Note 1)
Interest income $30,223
Dividend income (Net of foreign tax of $5,700) 67,477
Total income 97,700
EXPENSES (Notes 3 and 4)
Investment advisory fee 34,933
Custodian fees 23,555
Professional fees 4,792
Salaries and related expenses 11,799
Securities registration and blue sky expense 7,581
Telephone expense 717
Data processing and office equipment expense 15,084
Office and miscellaneous expenses 4,752
Depreciation and amortization 338
Investment advisory fee waived (20,681)
Total expenses 82,870
NET INVESTMENT INCOME 14,830
REALIZED AND UNREALIZED GAIN (LOSS)
FROM INVESTMENTS AND FOREIGN CURRENCY
Net realized loss on investments (581,432)
Net realized loss on foreign currency
transactions (3,488)
Capital gain distributions from regulated
investment companies 3,505
Net unrealized appreciation of investments 1,103,450
Net unrealized depreciation on foreign
currency transactions (3,053)
NET GAIN FROM INVESTMENTS AND FOREIGN CURRENCY 518,982
TOTAL INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $533,812
The Notes to Financial Statements are an integral part of
these statements.
<PAGE>
Worldwide Growth Portfolio
Statements of Changes in Net Assets
For the Years Ended March 31
INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS
Net investment income $14,830 $8,510
Net realized gain (loss) on investments (577,927) 12,222
Net realized loss on foreign currency
transactions (3,488) (4,875)
Net unrealized appreciation
(depreciation) of investments 1,103,450 (1,056,140)
Net unrealized depreciation on foreign
currency transactions (3,053) --
Total increase (decrease) in net
assets resulting from operations 533,812 (1,040,283)
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (22,834) (9,688)
From net capital gains -- (431,663)
CAPITAL SHARE TRANSACTIONS (Note 7) (714,253) 1,274,473
TOTAL DECREASE IN NET ASSETS (203,275) (207,161)
NET ASSETS
Beginning of year 3,318,984 3,526,145
End of year $3,115,709 $3,318,984
Worldwide Growth Portfolio
Financial Highlights
Selected data for a share outstanding throughout each
period:
<TABLE>
<CAPTION>
Year ended Year ended Period ended<F1>
March 31, 1996 March 31, 1995 March 31, 1994
<C> <C> <C>
Net asset value beginning
of period $ 8.501 $12.511 $10.000
Net investment income (loss) 0.044 0.022 (0.035)
Net realized and unrealized
gains (losses) on securities 1.387 (2.491) 2.546
Total from investment
operations 1.431 (2.469) 2.511
Distributions from net
investment income (0.070) (0.025) --
Distributions from capital
gains -- (1.516) --
Total distributions (0.070) (1.541) --
Net asset value end of
period $ 9.862 $8.501 12.511
Total return 16.88% (22.20)% 26.19%<F2>
Net assets at end of
period (thousands) 3,116 3,319 3,526
Ratio of expenses
to average net assets<F3> 2.38% 2.05% 1.81%<F2>
Ratio of ne income
to average net assets<F3> 0.43% 0.21% (0.48)%<F2>
Portfolio turnover 78% 65% 83%
<FN>
<F1>
April 16, 1993 (inception) to March 31, 1994
<F2>
Annualized
<F3>
Had BFIMC not waived advisory fees, the Portfolio's ratios
of expenses and net investment loss to average net assets
would have been 2.97% and (0.17)%, respectively, for the
year ended March 31, 1996, and 3.05% and (0.79)%,
respectively, for the year ended March 31, 1995. Had BFIMC
not waived the advisory fee and deferred a portion of the
operating expenses, the Portfolio's annualized ratios of
expenses and net investment loss to average net assets
would have been 4.24% and (2.92)%, respectively, for the
period from inception to March 31, 1994.
</FN>
</TABLE>
The Notes to Financial Statements are an integral part of
these statements.
Worldwide Growth Portfolio
Notes to Financial Statements
March 31, 1996
1. Summary of Significant Accounting Policies. GIT Equity
Trust (the "Trust") is registered with the Securities and
Exchange Commission under the Investment Company Act of 1940
as an open-end, diversified investment management company.
The Trust offers shares in four separate portfolios which
invest in differing securities. The Worldwide Growth
Portfolio (the "Portfolio") invests primarily in foreign
equity securities, emphasizing companies that are likely to
benefit from the growth of the world's smaller and emerging
capital markets. The Special Growth, Select Growth and
Equity Income Portfolios are managed independently from the
Worldwide Growth Portfolio and issue separate semi-annual
and annual financial reports to shareholders.
Securities Valuation: Securities traded on a securities
exchange are valued at their closing sale price, if
available, and if not available, such securities are valued
at the mean between their bid and asked prices. Other
securities, for which current market quotations are readily
available, are valued at the mean between their bid and
asked prices. Securities for which current market
quotations are not readily available are valued at their
fair value as determined in good faith by the Trustees.
Securities whose prices are quoted in foreign currency are
normally translated into U.S. dollars based on exchange
rates at 1 p.m., Washington, D.C. time. The portfolio does
not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in
market prices of securities held. Such fluctuations are
included with net realized and unrealized gain or loss on
investments. Investment transactions are recorded on the
trade date. The cost of investments sold is determined on
the identified cost basis for financial statement and
federal income tax purposes. Repurchase agreements are
valued at amortized cost, which approximates market value.
Foreign Currency Translations: The books and records of the
Portfolio are maintained in U.S. dollars. Foreign currency
amounts are translated into U.S. dollars on the following
basis:
(i) market value of investment securities, assets and
liabilities at the daily rates of exchange, and
(ii) purchase and sales of investment securities, dividend
and interest income and certain expenses at the rates
of exchange prevailing on the respective dates of such
transactions.
The Portfolio does not isolate that portion of the results
of operations resulting from changes in foreign exchange
rates on investments from the fluctuations arising from
changes in market prices of securities held. Such
fluctuations are included with the net realized and
unrealized gain or loss from investments.
Reported net realized gains or losses from foreign currency
transactions arise from sales and maturities of short-term
securities, sales of foreign currencies, currency gains or
losses realized between the trade and settlement dates on
securities transactions, the difference between the amounts
of dividends, interest, and foreign withholding taxes
recorded on the Portfolio's books, and the U.S. dollar
equivalent of the amounts actually received or paid. Net
unrealized gains and losses from foreign currency
transactions arise from changes in the value of assets and
liabilities other than investments in securities at the end
of the fiscal period, resulting from changes in exchange
rates.
Forward Foreign Currency Contracts: The Portfolio may enter
into forward foreign currency contracts in order to hedge
against foreign currency risk. Such contracts have been
used solely to establish a rate of exchange for settlement
of transactions. Forward foreign currency contracts are
valued at the forward rate and are marked-to-market daily.
The change in market value is recorded by the Portfolio as
an unrealized gain or loss. Realized gains or losses are
recognized when contracts settle. Although forward foreign
currency contracts limit the risk of loss due to a decline
in the value of the hedged currency, they also limit any
potential gain that might result should the value of the
currency increase. In addition, the Portfolio could be
exposed to risks if the counter parties to the contracts are
unable to meet the terms of their contracts.
Investment Income: Interest and other income (if any) is
accrued as earned. Dividend income is recorded on the ex-
dividend date, except that if the ex-dividend date has
passed, certain dividends from foreign securities are
recorded as soon as the Portfolio is informed of the ex-
dividend date.
Dividends: Substantially all of the Trust's accumulated net
investment income, determined as gross investment income
less accrued expenses, is declared as a regular dividend and
distributed to shareholders at least twice annually at
calendar and fiscal year end. Capital gains distributions
reflecting net realized gains of the portfolio, if any, are
declared and paid twice annually at calendar and fiscal year
end. Additional distributions will be made if necessary.
<PAGE>
Notes to Financial Statements (continued)
Income Tax: In accordance with the provisions of Subchapter
M of the Internal Revenue Code applicable to regulated
investment companies, all of the taxable income of each
portfolio is distributed to its shareholders, and therefore
no federal income tax provision is required. As of March
31, 1996, the Portfolio had available for federal income tax
purposes unused capital loss carryovers of $600,026 expiring
March 31, 2004.
Share Subscriptions: Shares purchased by check or otherwise
not paid for in immediately available funds are accounted
for as share subscriptions receivable and shares reserved
for subscriptions.
Use of Estimates: The preparation of the financial
statements in conformity with generally accepted accounting
principles requires management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities and reported amounts of increases and decreases
in net assets from operations during the reporting period.
Actual results could differ from those estimates.
2. Investments in Repurchase Agreements. When the Trust
purchases securities under agreements to resell, the
securities are held for safekeeping by the Trust's custodian
bank as collateral. Should the market value of the
securities purchased under such an agreement decrease below
the principal amount to be received at the termination of
the agreement plus accrued interest, the counterparty is
required to place an equivalent amount of additional
securities in safekeeping with the Trust's custodian bank.
Repurchase agreements may be terminated within seven days.
Pursuant to an Exemptive Order issued by the Securities and
Exchange Commission, the Trust, along with other registered
investment companies having Advisory and Services Agreements
with Bankers Finance Investment Management Corp. ("BFIMC"),
transfers uninvested cash balances into a joint trading
account. The aggregate balance in this joint trading
account is invested in one or more consolidated repurchase
agreements whose underlying securities are U.S. Treasury or
federal agency obligations.
3. Investment Advisory Fees and Other Transactions with
Affiliates. The Investment Adviser to the Trust, BFIMC,
earns an advisory fee equal to 1.00% per annum of the
average net assets of the Portfolio; the fee accrues daily
and is payable monthly. For the year ended March 31, 1996,
BFIMC waived $20,681 of such fee from the Portfolio. In
order to meet the securities registration requirements of
certain states, BFIMC has undertaken to reimburse the
Portfolio by the amount, if any, by which the total expenses
of the Portfolio (less certain excepted expenses) exceed the
applicable expense limitation in any state or other
jurisdiction in which the Trust is subject to regulation
during the fiscal year. The Trust believes the current
applicable expense limitation is 2.50% per annum of the
average net assets of each portfolio up to $30 million,
2.00% of any amount of such net assets exceeding $30
million but not exceeding $100 million, and 1.50% per annum
of such amount in excess of $100 million. BFIMC is
responsible for the fees and expenses of trustees who are
affiliated with BFIMC, the rent expense of the Trust's
principal executive office premises and certain promotional
expenses. For the year ended March 31, 1996, outside
trustees fees of $2,250 were paid by the Portfolio. Certain
officers, trustees, companies and individuals affiliated
with the Trust have investments in the Trust aggregating
9.2% of net assets.
4. Other Expenses. With the exception of certain expenses of
the Trust payable by it directly, all support services are
provided to the Trust under a services agreement between the
Trust and BFIMC, pursuant to which such services are to be
provided for amounts not exceeding the cost to BFIMC of the
support provided. For the year ended March 31, 1996,
expenses of $68,618 have been reimbursed to BFIMC under the
services agreement. As of March 31, 1996, expenses of
$7,605 have been incurred by BFIMC on behalf of the
Portfolio, the billing of which has been deferred.
5. Net Assets. At March 31, 1996, net assets include the
following:
Net paid in capital on shares
of beneficial interest $3,769,174
Accumulated net realized loss on investments (600,026)
Net unrealized depreciation of investments
and foreign currency (53,439)
Total net assets $3,115,709
The Portfolio reclassified $8,004 from accumulated net
investment losses and $5,995 from accumulated net losses on
foreign currency transactions to paid in capital as a result
of permanent book and tax basis differences. These
reclassifications had no impact on net asset value.
<PAGE>
Notes to Financial Statements (continued)
6. Investment Transactions. Purchases and sales of
securities other than short-term securities for the year
ended March 31, 1996 were $2,338,269 and $2,929,237,
respectively.
7. Capital Share Transactions. An unlimited number of
capital shares, without par value, are authorized.
Transactions in capital shares for years ended March 31 were
as follows:
1996 1995
In Dollars
Shares sold $960,967 $3,109,192
Shares issued in reinvestment
of dividends 18,767 399,120
Total shares issued 979,734 3,508,312
Shares redeemed (1,693,987) (2,233,839)
Net increase (decrease) $(714,253) $1,274,473
In Shares
Shares sold 100,911 275,640
Shares issued in reinvestment
of dividends 2,009 37,227
Total shares issued 102,920 312,867
Shares redeemed (177,403) (204,278)
Net increase (decrease) (74,483) 108,589
Worldwide Growth Portfolio
Special Tax Information (Unaudited)
March 31, 1996
Corporate shareholders should note that 1% of ordinary
dividend income resulting from the fiscal year ended March
31, 1996 qualifies for the corporate dividends-received
deduction.
For the year ended March 31, 1996, the Portfolio paid
foreign taxes of $5,700. The Portfolio intends to make a
distribution in December 1996, and it will make an election
under Section 853 of the Internal Revenue Code to allow
shareholders to treat their proportionate share of foreign
taxes paid by the fund as having been paid directly by them.
The Notes to Financial Statements are an integral part of
these statements
