MANAGERS INCOME EQUITY
FUND MANAGERS CAPITAL
APPRECIATION FUND
MANAGERS SPECIAL
EQUITY FUND MANAGERS
INTERNATIONAL EQUITY
FUND SEMI-ANNUAL
REPORT
JUNE 30, 1997
MANAGERS INCOME EQUITY
FUND MANAGERS CAPITAL
APPRECIATION FUND
MANAGERS SPECIAL
EQUITY FUND MANAGERS
INTERNATIONAL EQUITY
FUND Semi-Annual
Report
June 30, 1997
(unaudited)
TABLE OF CONTENTS
Begins on Page
---------PRESIDENT'S
MESSAGE 1
THE MANAGERS FUNDS PERFORMANCE 3
Complete performance table for all of The
Managers Funds
as of June 30, 1997
INVESTMENT MANAGER'S COMMENTS 4
Discussion of Funds' investment results
during the period
with a special focus on the sub-advisors of
Managers Special
Fund. Also, top ten holdings of each Fund.
SUMMARY OF MAJOR SECTORS AND COUNTRY
ALLOCATIONS 10
Side by side comparison of the Funds'
industry breakdown SCHEDULES OF PORTFOLIO
INVESTMENTS 11
Detailed portfolio listings by security type
and industry sector,
as valued at June 30, 1997
STATEMENTS OF ASSETS AND LIABILITIES 24
Fund balance sheets, Net Asset Value (NAV)
per share computation
and cumulative undistributed amounts
STATEMENTS OF OPERATIONS 25
Detail of sources of income, fund expenses,
and realized and unrealized
gains (losses) during the period
STATEMENTS OF CHANGES IN NET ASSETS 26
Detail of changes in fund assets and
distributions to shareholders for the
past two periods
FINANCIAL HIGHLIGHTS 28
Historical net asset values, distributions,
total returns, expense ratios,
turnover ratios and net assets
NOTES TO FINANCIAL STATEMENTS 32
Accounting and distribution policies, details
of agreements and transactions
with fund management and description of certain
investment
risks
Investments in The Managers Funds are not
deposits or obligations of, or guaranteed or
endorsed by, any bank. Shares of the funds are
not federally insured by the Federal Deposit
Insurance Corp., the Federal Reserve Board, or
any governmental agency.
President's Message
Dear Fellow Shareholder:
Despite a brief pause in late March and early
April, the financial markets charged to record
levels in the first half of 1997. The primary
driver continues to be strong economic growth
without evidence of inflation. Domestic stocks
turned in an extremely strong performance, with
most of the broad domestic stock indices hitting
all time highs during the second quarter.
European stocks were strong for the six months
while Far Eastern bourses were mixed.
The economy accelerated in the first quarter,
with Gross Domestic Product (GDP) rising at a
revised annualized rate of 4.9%, then cooled to
a 2.2% annual rate in the second quarter as
consumer spending slowed down. The key concern
during such relatively healthy growth continues
to be inflationary pressures, however, they have
yet to make any real impact. The Consumer Price
Index, which measures retail prices, rose only
slightly (0.69%) for the first six months of the
year, while the Producer Price Index, which
measures wholesale prices, dropped for six
consecutive months for the first time ever.
Business leaders have been reluctant to raise
prices for fear of losing market share, and they
are not likely to increase prices until their
true capacity is stretched. Labor rates have
risen only slightly, probably due to the current
expansion of the labor force and the proven
willingness of businesses to slash jobs which
has made labor groups reluctant to demand higher
fees.
Stocks of large companies began the year
reasonably well with strong earnings reports
buoying prices. As the surging economic
statistics would suggest, corporate fundamentals
remain strong and corporate managers
consistently raised their dividends. However,
just as low interest rates were an important
factor in the rising valuation of the market
over the past two years, rising rates put a
damper on stock prices in the first quarter. Not
surprisingly, the stocks with the highest
valuations (i.e., P/E) were hit the hardest.
With the rosy economic environment coming into
question in March, the market moved toward more
predictable holdings, and earnings
disappointments were punished severely. While
large capitalization indices such as the S&P 500
and the Dow Jones Industrial Average (the "Dow")
rose 10% into mid-February, small capitalization
stocks, as measured by the Russell 2000, were
languishing with very large performance
differences between "growth" stocks, which moved
lower, and "value" stocks.
In the second quarter, domestic stocks moved
sharply higher. As the market rose, it became
more volatile because investors are becoming
increasingly concerned with valuations. Much of
the concern focuses on the level of interest
rates, which is primarily why the market
corrected in March, in anticipation of the
Federal Reserve Board's interest rate hike, and
rallied in May, when first quarter earnings and
inflation statistics showed healthy corporate
earnings and no evidence of inflation. Continued
strong cash flows into mutual funds, and
increasing merger activity also boosted stock
prices. In addition to the "index effect," large
capitalization stocks also benefited from
investors' pursuit of liquidity in their climb
up the "wall of worry." This could backfire on
investors who lose sight of price risk in their
quest to minimize liquidity risk.
The Dow closed at 7,673, returning 20.1% for the
six months. The S&P 500 index returned 20.6%,
the NASDAQ Composite index returned 11.9% and
the Russell 2000 Index, which measures the
performance of a broad list of small
capitalization stocks, returned 10.2% during
this period.
Foreign stocks performed extremely well during
the first six
months of 1997, particularly when measured in
their local currencies. Despite continuing
uncertainty over the fate of the European
Monetary Union, along with other shocks such as
surprise election victories in France and
Britain, European stocks moved sharply higher,
benefiting from the same conditions which have
been propelling the U.S. markets over the past
few years. The strength in the U.S. Dollar
versus most European currencies diminished the
returns somewhat. Stocks in the Far East were
mixed, although the major markets were strong
during the second quarter. Japan's Nikkei Index,
which lost 7% in the first quarter, rebounded
sharply by rising 14.5% for the second quarter.
The Japanese Yen followed a similar path,
dropping 7% during the first quarter, then
rebounding 8.0% during the second quarter. Thus,
the Japanese market returned roughly 8.4% in
U.S. Dollars for the six month period. During
the second quarter, Hong Kong stocks surged 21%
in anticipation of the June 30th handoff from
British rule to the Chinese.
Domestic bonds offered more stability during the
first quarter, but no meaningful returns as bond
yields rose across all maturities and the first
quarter culminated with the Federal Reserve
Board raising the discount rate by 25 basis
points (25%).
The healthy economic environment served the
domestic bond markets well during the second
quarter. The Fed's decision to hold rates
steady, along with the aforementioned lack of
inflationary evidence, gave investors confidence
that interest rates were appropriately
positioned. Rates dropped moderately across all
maturity ranges.
Looking forward, we urge you to remember that
the strength of the equity markets has been the
result of a near perfect economic environment.
As recently noted in Barron's, over the past
fifteen years, equity investors have enjoyed the
best average return of any fifteen year period
in the last 180 years. While this favorable, yet
delicately balanced, environment could continue
for awhile, the returns are not likely to be
nearly as robust. We continue to believe that
diversification into several asset classes is
prudent, and that it is particularly important
to evaluate and rebalance investment portfolios
based on future prospects rather than relying on
past performance.
We at The Managers Funds continue to believe
that active portfolio management by experienced
investment professionals with the resources to
research and evaluate individual issues is the
best strategy in the long run. Common sense
suggests that stocks should be owned based on
their individual merit and prospective returns
rather than their group membership or historical
returns. We also believe, as do most investment
organizations, that there are many different,
yet successful, approaches to equity investing,
and that there are benefits to diversifying
across investment approaches.
As always, should you have any questions on this
report, please feel free to contact us or your
financial advisor. We thank you for your
continued investment in The Managers Funds.
Sincerely,
/s/ Robert P. Watson
Robert P. Watson
President
THE MANAGERS FUNDS PERFORMANCE (UNAUDITED)
All periods ending June 30, 1997
Average Annual Total Returns*
- --------------------------------------------------
- --------------------
Since
Inception Morningstar
6 Months 1 Year 3 Years 5 Years 10 Years
Inception Date Rating**
------------ -------- ---------- ---------
- - ---------- ------------ -------- --------
Equity Funds:
Income
Equity 15.06%27.21%23.00%17.10%12.22%15.23%Oct.
'84****
Capital
Appreciation
Fund 5.09%11.97%18.28%15.22%12.79%15.28%Jun.
'84***
Special Equity
Fund 9.93%16.25%24.57%20.27%15.84%16.63%Jun.
'84****
International
Equity
Fund12.79%19.38%14.70%15.64%10.47%14.83%Dec. '85
****
Income Funds:
Short Government
Fund 2.34% 5.55% 5.62% 2.86% - 5.18%Oct.
'87**
Short & Intermediate
Bond Fund 2.35% 6.22% 6.41% 5.31% 7.19% 8.42%Jun.
'84****
Intermediate Mortgage
Fund 3.09% 7.78% 6.41% 2.23% 6.68% 7.09%May
'86 *
Bond Fund 3.96%13.31%12.26% 9.15%
9.88%11.24%Jun. '84*****
Global
Bond Fund-1.64%4.31% 6.27% - - 5.75%Mar.
'94 *
Money
Market Fund2.61%5.35%5.11% 4.11% 5.45% 5.89%Jun.
'84NA
Past performance is no guarantee of future
results. Investment returns and share price will
fluctuate. The redemption price of a mutual fund
may be more or less than the purchase price. For
additional or more recent information, or for a
current prospectus for any Fund(s), please call
The Managers Funds at (800) 835-3879, or your
investment adviser.
*Total return equals income yield plus share
price change and assumes reinvestment of all
dividends and capital gain distributions. No
adjustment has been made for taxes payable by
shareholders on their reinvested dividends and
capital gain distributions. Returns for periods
greater than one year are annualized.
**Morningstar proprietary ratings reflect risk-
adjusted performance through 6/30/97 and are
subject to change every month. The ratings are
by asset class and are calculated from the
funds' three-, five- and ten-year returns (with
fee adjustments) in excess of 90-day Treasury
bill returns, and a risk factor that reflects
fund performance below 90-day Tbill returns. For
the three-, five- and ten-year periods,
respectively, each of the Equity Funds other
than the International Equity Fund was rated
against 2,016, 1,153 and 637 equity funds, the
International Equity Fund was rated against 535,
245 and 94 international equity funds, and each
of the Income Funds was rated against 1,258, 687
and 293 fixed-income funds. Ten percent of the
funds in each asset class receive five stars,
22.5% receive 4 stars, 35% receive 3 stars,
22.5% receive 2 stars and 10% receive 1 star.
Managers Income Equity Fund
Investment Manager's Comments -----------------
- ------------------------------------------------
- ----------------
Managers Income Equity Fund is an income
oriented stock fund managed by The Managers
Funds, L.P. since its inception in 1984. The
Managers Funds currently utilizes two
independent subadvisors who each manage
approximately half of the total portfolio:
Anthony Spare, of Spare, Kaplan, Bischel &
Associates (SKB&A), hired in August 1990, and
Robert Hoffman, of Scudder, Stevens & Clark,
Inc. (SS&C), hired in August 1991.
The Six Month Review During the first six months
of 1997, Managers Income Equity Fund provided a
total return of 15.1% versus the Standard &
Poor's 500 Stock Index (S&P 500) return of
20.6%. -----------------------------------------
- ---------------------------------------
Top Ten Holdings as of June 30, 1997
% Fund
----------
Phillip Morris* 2.3
GTE* 2.2
J.C. Penney* 2.0
Xerox 2.0
J.P. Morgan* 1.9
Bell Atlantic* 1.8
NYNEX* 1.7
Corestates Financial 1.7
Philips Electronics 1.7
Ford Motor Co. 1.7
*A top ten holding December 1996
- ------------------------------------------------
- ---------------------------------
The Fund's yield oriented style, partly intended
to reduce volatility, can typically be expected
to lag the market in strong upturns, while
outperforming the market during moderate, flat
and down markets. Thus, it is not surprising
that the Fund lagged the market early in the
first quarter and again during the strong second
quarter rally, although it did make up some
relative performance during the March/April
downturn.
The Fund's heavy weighting in electric utility
stocks were a primary weakness during the first
six months of 1997. Utilities as a sector were
by far the poorest performers for the period,
rising "only" 5%. In particular, the Fund's
position Northeast Utilities declined 40% in the
first quarter after its dividend was eliminated.
The position was subsequently liquidated early
in the second quarter.
The Fund's largest holding, Phillip Morris,
which was marked by volatility associated with
pending settlement of tobacco litigation, kept
up with the market returning 20% during the
period.
Pharmaceuticals were an area of strength for the
period. Fund holdings of Bristol-Myers Squibb
and Warner Lambert rose 50% and 66%,
respectively, while both managers took advantage
of the prices by reducing their holdings on
strength during the second quarter.
Strong top ten holdings included Bell Atlantic
and NYNEX, which announced their merger, and
Xerox and Phillips Electronics which returned
50% and 80%, respectively, during the six month
period.
Although hurt by rising interest rates in the
first quarter, financials, which make up a large
portion of the Fund, performed well during the
second quarter, notably Lincoln National and
Student Loan Marketing (Sallie Mae) which rose
23% and 36%, respectively, for the six
month period.
Managers Capital Appreciation Fund
Investment Manager's Comments ------------------
- ------------------------------------------------
- ------------------------
Managers Capital Appreciation Fund is a growth
oriented stock fund managed by The Managers
Funds, L.P. since its inception in 1984. The
Managers Funds currently utilizes two
independent subadvisors who each manage
approximately one half of the total portfolio:
Frank Husic at Husic Capital Management, hired
in September, 1996, and Joseph McNay of Essex
Investment Management Company, just hired in
March of 1997.
The Six Month Review
During the first six months of 1997, Managers
Capital Appreciation Fund provided a total
return of 5.1% versus 20.6% for the S&P 500.
The Fund lagged the market in both the first and
second quarters of 1997. During March, the Fund
began a restructuring process when Essex
Investment Management was hired to replace
Dietche & Field Advisers. The timing of this
restructuring to a more aggressive, growth
oriented portfolio coincided with the
March/April market decline which punished the
technology and health care companies which both
managers held.
The correction, however, did give Essex an
opportunity to establish new positions at more
favorable prices. Husic also repositioned its
portfolio and the results of both managers'
efforts are reflected in the top ten holdings,
where only one stock (Household International)
from the top ten list of December 1996 remained
in that list at June 30. -----------------------
- ------------------------------------------------
- ------------------------------
Top Ten Holdings as of June 30, 1997
% Fund
----------
Household International* 2.3
Washington Mutual 2.2
America Online 2.0
Warner Lambert 2.0
National Semiconductor 1.9
Schlumberger 1.8
Citicorp. 1.7
Federal Express 1.7
Philips Electronics 1.7
Xerox 1.7
Microsoft 1.7
*A top ten holding December 1996
- ------------------------------------------------
- ---------------------------------
During the second quarter, the Fund's avoidance
of some of the largest components of the S&P
500, which performed well, led to continued
underperformance for the Fund. This was
particularly true in the technology sector where
the Fund's holdings rose only 10% on average,
versus 18% for the entire technology sector.
There can be no generalizations as to why the
managers chose not to hold these companies,
other than to note that they see better
appreciation potential for their holdings in
terms of growth and valuations. Examples of
these include National Semiconductor, a top ten
holding which only rose 10% during the second
quarter and 26% for the full six months, and
Advanced Micro Devices, which corrected 13%
after a sharp first quarter rise and finished
up 40% for the first half.
Areas of relative strength in the second
quarter included individual names such as
Tellabs, which rose 55% upon announcing record
revenues and sharply higher earnings and Xerox,
which was added to the portfolio in May and
rose 19% upon the company's introduction of a
new product line.
The Fund's financial and healthcare holdings
were the strongest performers during the first
six months. The Fund's two largest holdings,
Household International and Washington Mutual
appreciated 27% and 38, respectively, and
BankAmerica rose by 29%. A new position in
Warner Lambert added during the second quarter
rose 17%, while core positions in Pfizer and Eli
Lilly appreciated 16% and 26%, respectively, for
the full six-month period.
Other areas of relative strength included
positions in Microsoft, America Online and
Federal Express, which rose 53%, 38% and 30%,
respectively, during the six month period.
Managers Special Equity Fund
Investment Manager's Comments ------------------
- ------------------------------------------------
- ------------------------
Managers Special Equity Fund, managed by The
Managers Funds, L.P. since its inception in
1984, is a growth oriented equity fund which
primarily invests in the stocks of small
capitalization companies. The Managers Funds
currently utilizes three independent subadvisors
who each manage approximately one third of the
total portfolio: Andrew Knuth of Westport Asset
Management, and Timothy Ebright of Liberty
Investment Management, each of whom has been
managing a portion of the fund since December,
1985, and Gary Pilgrim of Pilgrim Baxter &
Associates, who has been managing a portion of
the fund since October, 1994.
The Portfolio Managers
Andy Knuth's investment philosophy entails
investing in small capitalization companies
which he perceives as having significant upside
potential in earnings and return on equity over
the next twelve to eighteen months. Although he
is investing for growth, Andy will purchase
stocks only if they are selling at or below the
market's price/earnings multiple, or below
valuations of other companies in the same
industry. Thus, he must discover and invest in
companies very early in their growth cycle.
Implicit in the strategy is that Andy and his
partner focus on a small number of issues and
normally hold them for a long time. The
concentration and low turnover enable Andy to
heavily research and monitor each position. He
is focused on future profits only, and, in fact,
prefers to find businesses which are inherently
good but which have gone through a troubling
period. Factors which may improve earnings and
investor perceptions include acquisitions or
divestitures, management shakeups, changes in
the business cycle, or the development of a
proprietary product in a strong industry. He
specifically searches for companies with good
managers who are finding ways to substantially
improve the company.
The result is that Andy will typically have a
portfolio of approximately 30 stocks, and any
significant industry concentrations are merely
an outcome of bottom up selection. Because some
of the companies in which he invests may not yet
have earnings, the price to trailing earnings
ratio may be high, although the price to forward
earnings will be well below average. Andy is a
patient investor, usually turning over less than
20% of his portfolio per year.
While similar in some respects, Tim Ebright, of
Liberty Investment Management searches for a
different kind of value
and growth. Tim searches for companies which
have very predictable earnings, positive
operational cash flow and a defensible market
position, which are selling for less than the
intrinsic value of the business. In addition,
Tim prefers companies in which the managers own
a substantial portion of the stock.
Typically, this combination can only be found in
companies that have not been "discovered" by
institutional investors, or have been "orphaned"
since their initial public offerings. Companies
such as this tend to be very small, thus, Tim is
what many consider a micro-cap manager. That is,
he typically invests in companies with market
capitalizations under $300 million, sometimes
far smaller. If his analysis is correct, the
portfolio makes money in one of three ways:
First, the company may continue to churn out
steady earnings growth for an indefinite period.
Second, the stock may be discovered by
institutional investors and enjoy an expansion
of its valuation. Third, the company may be
acquired at or above its intrinsic value.
Because of the size of the companies, Tim must
build a portfolio of close to 100 positions.
These stocks tend to be less susceptible to
market swings, and exhibit less price volatility
merely because they trade much less than larger
companies. Their added risk is in their lower
liquidity. Gary Pilgrim, of Pilgrim Baxter &
Associates focuses only on companies with high
and accelerating earnings growth. First, he
screens for stocks which are exhibiting at least
20% or greater earnings growth. He then ranks
these stocks using a proprietary quantitative
ranking system (QRS) which focuses on recent
earnings growth, earnings acceleration,
prospective earnings growth and potential for
earnings surprises. A team of analysts at
Pilgrim Baxter speak with managements and
analyze the businesses to confirm and refine
earnings expectations, and stocks are purchased
and sold based on their relative rankings.
Typically the portfolio will have an average
historical and expected earnings growth rate of
near 50%. Because such a high priority is placed
on high growth, the companies in the portfolio
tend to be very visible, and possess very high
price to earnings multiples. While successful
growers move up in price quickly, companies
posting disappointing earnings move down
dramatically as well. High multiples also make
the prices very sensitive to industry and
economic news and events. The result is a
portfolio which exhibits a high level of price
volatility.
In addition, the QRS's focus on short-term
periods results in a high level of portfolio
turnover. This is a necessary circumstance since
companies with high price multiples whose growth
is slowing need to be identified and replaced
immediately. Gary typically holds around 80
positions and has an annual turnover ratio in
excess of 200%. His portfolios are also
typically heavily weighted in a few business
sectors.
Risk is a necessary part of investing, and is
particularly inherent in investing in small
capitalization companies. In this Fund we have
combined three managers, who each specialize in
a different type of risk. Andy Knuth takes on
extra specific (or company) risk by
concentrating his portfolio in a small number of
stocks. Meanwhile he is trying to decrease price
risk by purchasing undervalued companies. Tim
Ebright is taking on added liquidity risk while
decreasing specific and price risks. Gary
Pilgrim is taking on added price risk while
lowering specific risk.
The Six Months in Review
During the first six months of 1997, Managers
Special Equity Fund provided a total return of
9.9% as compared to the
Russell 2000, a broad index of small
capitalization stocks, which returned 10.2%. ---
- ------------------------------------------------
- -----------
Top Ten Holdings as of June 30, 1997
% Fund
----------
Airborne Freight* 1.8
Xtra Corp. 1.6
Pittston Brinks Group 1.3
Downey Financial Group 1.3
AAR Corp. 1.1
Circle International 1.1
Charter Power Systems* 1.1
Air Express International* 1.1
Checkpoint Systems 1.0
MacFrugals Bargains Close Outs* 1.0
*A top ten holding December 1996
- ------------------------------------------------
- ----------------------------------
The first quarter of 1997 was difficult for
small capitalization stocks in general,
particularly for the growth segments of both the
index and the Fund. Despite a positive earnings
environment, the valuations of aggressively
growing companies retracted substantially,
continuing a trend begun last June. The Pilgrim
Baxter portion of the portfolio suffered more
than the other two managers' portions of the
Fund, specifically in technology and software
companies which were down 19% on average.
The second quarter saw the end of the ten-month
bear market for small cap stocks, and the Fund
more than made up its relative under-performance
of the first quarter. The rally was broad, as
all sectors represented in the portfolio
appreciated by double digit percentages.
National Education, long one of the Fund's
largest holdings, was acquired in June by
Harcourt General at a price 38% higher than its
year end valuation. Other second quarter
takeovers included Living Centers of America, a
nursing home operator, and Premier Radio
Networks.
Transportation holdings, which were an area of
strength in the first quarter, continued to
shine in the second quarter. During the six-
month period, top ten holdings of Airborne
Freight, Air Express International and Circle
International (formerly Harper Group) each rose
79%, 24% and 12%, respectively.
The Fund's high cash position (16%) at June 30
was partially due to receipt of cash proceeds
from the National Education acquisition along
with strong cash inflows from investors into the
Fund. This cash position is not being held in
attempt to time the market, and it will be
reduced over time as the portfolio managers put
it to work in new stocks.
Managers International Equity Fund
Investment Manager's Comments ------------------
- ------------------------------------------------
- ------------------------
Managers International Equity Fund, managed by
The Managers Funds, L.P. since its inception in
1985, seeks long-term capital appreciation
through investment in nonU.S. equity securities.
The Managers Funds currently utilizes two
independent subadvisors who each manage
approximately one half of the total portfolio:
William Holzer of Scudder, Stevens & Clark,
Inc., hired in December 1989, and John
Reinsberg, of Lazard Freres Asset Management,
who was hired
in January 1995.
The Six Months in Review
During the first six months of 1997, Managers
International Equity Fund provided a total
return of 12.8% versus 11.2% for the Morgan
Stanley Capital International - Europe Australia
Far East Index (EAFE). -------------------------
- ------------------------------------------------
- ------------------
Top Ten Holdings as of June 30, 1997
% Fund
---------
Novartis 2.3
Hoechst* 2.2
Zurich Versicherung 2.0
DaimlerBenz* 2.0
Matsushita Electric Industries 1.9
Nestle SA, Reg. ADR* 1.8
Mannesmann* 1.7
Unilever 1.7
Viag 1.7
Sony* 1.7
*A top ten holding December 1996
- ------------------------------------------------
- ---------------------------------
The first half of 1997 was marked by consistent
positive performance in the European markets,
and a healthy second quarter bounce back in
Japan after a weak first quarter.
The Fund's relative over-weighting in Europe and
underweighting in Japan helped the Fund's
performance in the first quarter, however, it
led to the Fund losing some relative ground
during the second quarter when Japan led the
markets.
Of note in the first quarter were holdings in
France, Germany and Switzerland, which rose 13%,
5% and 7%, respectively, in U.S. Dollars.
Offsetting these were holdings in the U.K. which
declined 2% on average, and the Fund's Japanese
holdings, which dropped 5.5%, yet still
outperformed the Japanese market in general
which was down 13% in U.S. Dollars.
During the second quarter, the Fund's holdings
in Japanese companies rose 22% on average,
slightly lagging the Japanese market in general
which rose 24% in U.S. Dollars. The most
significant Japanese holdings were Orix (+78%),
Matsushita Electric Industries (+23%) and Sony
(+33%) during the sixmonth period.
Other holdings of note included Novartis, the
Fund's largest holding, which rose 40% during
the six months, as well as Zurich Insurance and
Philips Electronics which rose 43% and 59%,
respectively, during the period.
Managers Income Equity Fund
Schedule of Portfolio Investments
June 30, 1997 (unaudited)
Shares
Value COMMON STOCKS - 94.5%
Basic Industries - 12.5%
Allegheny Teledyne, Inc. 15,017
$405,459
Betzdearborn, Inc. 6,500
429,000
Consolidated Papers, Inc. 900
48,600
Dow Chemical Co.
11,200 975,800
Eastman Chemical Co.
9,000 571,500
E.I. duPont de Nemours & Co., Inc.
4,100 257,787
Freeport, McMoRan Copper & Gold,
8,400 245,700
Inc., Class A
Georgia Pacific Corp.
5,600
478,100
Imperial Chemical Industries PLC -
12,800 * 728,000
Sponsored ADR
Louisiana-Pacific Corp.
8,300
175,337
Lubrizol Corp.
4,000
167,750
Olin Corp.
8,700
339,844
Oregon Steel Mills, Inc.
13,300
265,169
Phelps Dodge Corp.
1,800
153,338
Potlatch Corp.
5,600
253,400
Union Camp Corp.
8,900
445,000
Westvaco Corp.
8,800
276,650
Weyerhaeuser Co.
17,100
889,200
Witco Corp.
19,300
732,194
Total Basic Industries
7,837,828
CAPITAL GOODS - 3.2%
Martin Marietta Materials, Inc. 4,951 160,289
PACCAR, Inc. 7,400 343,175
Philips Electronics NV - ADR 14,900 1,070,9
37 Rockwell
International Corp. 7,400 436,600
Total Capital Goods
2,011,001
COMMUNICATION SERVICES - 11.8%
ALLTEL Corp. 11,300 377,844
Ameritech Corp. 4,100 278,544
AT & T Corp. 10,100 354,131
Bell Atlantic Corp. 15,300 1,160,8
87 BellSouth
Corp. 7,700 357,087
Frontier Corp. 8,000 159,500
GTE Corp. 31,700 1,390,8
37 NYNEX Corp.
18,900 1,089,1
13 SBC
Communications, Inc. 10,386 642,634
Southern New England 8,700 338,212
Telecommunications Corp.
Sprint Corp. 8,500 447,313
U.S. West Communications Group, Inc. 22,200 836,663
Total Communication Services
7,432,765
CONSUMER BASICS - 7.8%
Anheuser-Busch Co., Inc. 6,400 268,400
Gallaher Group PLC - ADR+ 5,300 97,719
General Mills, Inc. 10,100 657,762
Heinz (H.J.) Co. 16,900 779,512
Philip Morris Cos., Inc. 33,100 1,468,8
13 RJR Nabisco
Holdings Corp. 5,440 179,520
Unilever NV, New York registered 3,400 741,200
shares
UST, Inc. 18,100 502,275
Warner Lambert Co. 1,600 198,800
Total Consumer Basics
4,894,001
CONSUMER DURABLE GOODS - 5.1%
Dana Corp. 11,700 444,600
Eaton Corp. 2,100 183,356
Ford Motor Co. 27,700 1,045,6
75
General Motors Corp.
5,200
289,575
TRW, Inc.
13,500
766,969
Whirlpool Corp.
8,300
452,869
Total Consumer Durable Goods
3,183,044
CONSUMER NON-DURABLE - 5.4%
Fortune Brands, Inc.
9,300
347,006
International Flavors & Fragrances,
2,200
111,100
Inc.
J.C. Penney Co., Inc.
24,500
1,278,5
94 Kimberly-
Clark Corp. 9,200 457,700
May Department Stores Co.
5,400
255,150
Mercantile Stores Co., Inc.
500
31,469
Rite Aid Corp.
10,100
503,737
Sears, Roebuck & Co.
7,700
413,875
Total Consumer Non-Durable
3,398,631
ENERGY - 8.8%
Amoco Corp.
6,000
521,625
Atlantic Richfield Co.
12,000
846,000
Chevron Corp.
5,200
384,475
Compagnie Francaise de Petroleum
7,100
359,437
Total, Sponsored ADR
Elf Aquitaine, Sponsored ADR
9,341
508,501
(France)
Exxon Corp.
15,600
959,400
Lyondell Petrochemical Co.
10,400 * 226,850
MCN Energy Corp.
8,400
257,250
Royal Dutch Petroleum Co. - NY
7,200
391,500
Registered Shares
Texaco, Inc.
6,500
706,875
YPF Sociedad Anonima, Class D,
12,100
372,075
Sponsored ADR (Argentina)
Total Energy
5,533,988
FINANCE AND INSURANCE - 16.1%
American General Corp.
10,300
491,825
Banc One Corp.
17,150
830,703
Bankers Trust New York Corp.
4,700
408,900
Chase Manhattan Corp.
4,400
427,075
CoreStates Financial Corp.
20,000
1,075,0
00 EXEL Ltd.
(USA) 7,200 379,800
Federal National Mortgage
8,400
366,450
Association
First Bank Systems, Inc.
4,700
401,262
First Union Corp.
2,600
240,500
J.P. Morgan & Co., Inc.
11,300
1,179,4
38 KeyCorp
7,000 391,125
Lincoln National Corp.
15,500
997,812
Marsh and McLennan Companies, Inc.
6,000
428,250
Mellon Bank Corp.
12,500
564,063
Mid Ocean Ltd.
5,200
272,675
National City Corp.
1,300
68,250
PNC Bank Corp.
8,800
366,300
Safeco Corp.
9,900
462,206
Student Loan Marketing Association
6,100
774,700
Total Finance and Insurance
10,126,334
GENERAL BUSINESS - 1.4%
Deluxe Corp.
8,500
290,063
Dun & Bradstreet Corp.
8,700
228,375
H & R Block, Inc.
11,100
357,975
Total General Business 876,413
HEALTH CARE - 5.3%
American Home Products Corp.
6,400
489,600
Baxter International, Inc.
8,800
459,800
Bristol-Myers Squibb Co.
12,700
1,028,7
00 Pharmacia &
Upjohn, Inc. 5,700 198,075
Schering-Plough Corp.
12,200
584,075
SmithKline Beecham Unit PLC,
2,800
256,550
Sponsored ADR
Zeneca Group PLC, Sponsored ADR
3,500
346,938
Total Health Care
3,363,738
REAL ESTATE - 1.6%
Developers Diversified Realty Corp.
1,600
64,000
Health Care Property Investors, Inc.
6,800
239,700
Meditrust
7,000
279,125
Nationwide Health Properties, Inc.
10,500
231,000
Security Capital Industrial Trust
9,658
207,647
Total Real Estate
1,021,472
TECHNOLOGY - 3.6%
AMP, Inc.
4,300
179,525
Lockheed Martin Corp.
1,526
158,036
Thomas & Betts Corp.
6,400
336,400
United Technologies Corp.
4,200
348,600
Xerox Corp.
15,800
1,246,2
25
Total Technology
2,268,786
TRANSPORTATION - 1.4%
Canadian National Railway Co.
5,300
231,875
CSX Corp.
7,000
388,500
Union Pacific Corp.
3,700
260,850
Total Transportation 881,225
UTILITIES - 10.5%
Baltimore Gas & Electric Co.
18,600
496,387
Boston Edison Co.
3,100
81,763
Central & South West Corp.
15,900
337,875
Cinergy Corp.
3,700
128,806
Consolidated Natural Gas Co.
4,700
252,919
Duke Power Co.
16,891
809,699
Florida Progress Corp.
8,400
263,025
National Power PLC, Sponsored ADR
6,600
232,237
NICOR, Inc.
10,200
365,925
OGE Energy Corp.
7,000
318,500
Pacificorp
6,600
145,200
PG&E Corp.
11,900
288,575
Powergen PLC, Sponsored ADR
6,300
305,550
PP & L Resources, Inc.
9,900
197,381
Public Service Enterprise Group
10,000
250,000
Public Services Company of Colorado
4,000
166,000
Southern Co.
4,100
89,688
Texas Utilities Co.
5,900
203,181
Unicom Corp.
12,400
275,900
Union Electric Corp.
15,200
572,850
Western Resources, Inc. 7,100 230,306
Wisconsin Energy Corp. 23,300 579,588
Total Utilities
6,591,355
Total Common Stocks
(cost $43,632,543) 59,420,
581
PREFERRED STOCKS - 0.7%
Basic Industries - 0.3%
Boise Cascade Corp., Series G, $1.58 7,600 216,600
Consumer Non-Durable - 0.4%
Kmart Financing I, Convertible, 4,600 252,425
$3.42**
Total Preferred Stocks
(cost $483,424) 469,025
SHORT-TERM INVESTMENTS - 4.5%
Calvert Cash Reserves Institutional 1,834,0
1,834,0 Prime Fund
84 83
Landmark Institutional Liquid 588,614
588,613 Reserves
SSgA Money Market Fund 393,160
393,161
Total Short-Term Investments
(cost $2,815,857) 2,815,857
Total Investments - 99.7%
(cost $46,931,824) 62,705,463
Other Assets, less Liabilities - 168,434
0.3%
Net Assets - 100.0% $62,873,897
Note: Based on the cost of investments of
$46,961,879 for federal income tax purposes
at June 30, 1997, the aggregate gross
unrealized appreciation and depreciation was
$16,017,503 and $273,919, respectively,
resulting in net unrealized appreciation
of investments of $15,743,584.
+ Non-income-producing security.
* Some or all of these shares, amounting to
$1,212,677, or 1.9% of net assets, were
out on loan to various brokers as of June 30,
1997.
** Stated rate is annualized based on the last
quarterly dividend paid.
Investment Abbreviations:
ADR: Securities whose value is determined or
significantly influenced by trading on
exchanges not located in the United States or
Canada. ADR after the name
of a holding stands for American Depositary
Receipt, representing ownership
of foreign securities on deposit with a
domestic custodian
bank.
The accompanying notes are an integral part of
these
financial statements.
Managers Capital Appreciation Fund
Schedule of Portfolio Investments
June 30, 1997 (unaudited)
Shares Value
Common Stocks - 99.2%
Basic Industries - 1.0%
Corning, Inc. 17,300 $962,312
Capital Goods - 1.2%
Applied Materials, Inc.* 16,800 1,188,60
0
Communication Services - 9.1%
Advanced Fibre Communications* 27,200 1,643,90
0 Ascend
Communications, Inc.* 20,000 785,000
Ciena Corp. 36,400
** 1,713,07
5 CNET, Inc.*
47,500 ** 1,389,37
5 LCI
International, Inc.* 41,700 912,187
Lucent Technologies, Inc. 7,400 533,263
WorldCom, Inc.* 63,500 2,028,03
1
Total Communication Services 9,004,83
1
Computer Software - 14.3%
BMC Software, Inc.* 22,900 1,268,08
8 Citrix
Systems, Inc.* 25,700 1,127,58
7 Compuware
Corp.* 22,000 1,050,50
0 HBO &
Company 27,400 1,887,17
5 McAfee
Associates, Inc.* 15,000 945,000
Microsoft Corp.* 18,300 2,313,80
6 Oracle
Corp.* 20,900 1,051,53
1 Peoplesoft,
Inc.* 35,500 1,872,62
5 Sterling
Commerce, Inc.* 35,300 1,160,48
8 Viasoft,
Inc.* 17,400 ** 883,050
Visio Corp.* 8,100 570,544
Total Computer Software 14,130,3
94
Consumer Basics - 4.8%
Colgate-Palmolive Co. 7,800 508,950
Philip Morris Cos., Inc. 28,400 1,260,25
0 Warner
Lambert Co. 24,300 3,019,27
5
Total Consumer Basics 4,788,47
5
Consumer Durable Goods - 3.6%
SPX Corp. 20,500 1,328,65
6 Sunbeam
Corp., Inc. 60,000 2,265,00
0
Total Consumer Durable Goods 3,593,65
6
Consumer Non-Durable - 4.8%
Home Depot, Inc. 20,000 1,378,75
0 Liz
Claiborne, Inc. 28,500 1,328,81
3 Rite Aid
Corp. 17,200 857,850
Wal-Mart Stores, Inc. 33,700 1,139,48
1
Total Consumer Non-Durable 4,704,89
4
Energy - 4.1%
Santa Fe International Corp.* 8,000 272,000
Schlumberger, Ltd. 22,500 2,812,50
0 Valero
Energy Corp. 26,800 971,500
Total Energy 4,056,00
0
Entertainment and Leisure - 5.3%
America Online, Inc.* 57,900 3,220,68
8 Time
Warner, Inc. 41,200 1,987,90
0
Total Entertainment And Leisure 5,208,58
8
Environmental Controls - 0.7%
Republic Industries, Inc.* 30,000 746,250
Finance and Insurance - 15.2%
American Express Co. 15,000 1,117,50
0 BankAmerica
Corp. 32,000 2,066,00
0 Citicorp
22,100 2,664,43
1 Hartford
Life, Inc. - Class A* 13,800 517,500
Household International, Inc. 38,900 4,568,31
9 Washington
Mutual, Inc. 69,100 ** 4,128,72
5
Total Finance And Insurance 15,062,4
75
General Business - 2.1%
Apollo Group, Inc. - Class A* 27,200 958,800
McGraw-Hill Companies 18,400 1,082,15
0
Total General Business 2,040,95
0
Health Care - 8.9%
Bristol-Myers Squibb Co. 13,100 1,061,10
0 Centocor,
Inc.* 13,600 421,600
Dura Pharmaceuticals, Inc.* 28,400 1,128,90
0 Elan Corp.
PLC - Sponsored ADR* 21,900 ** 990,975
Eli Lilly & Co. 10,400 1,136,85
0 Genzyme
Corp. (General Division)* 44,000 1,215,50
0 Johnson &
Johnson 7,700 495,688
Merck & Co., Inc. 10,100 1,045,35
0 Pfizer,
Inc. 10,900 1,302,55
0
Total Health Care 8,798,51
3
Real Estate - 0.6%
Redwood Trust, Inc. 13,300 618,450
Technology - 19.7%
Advanced Micro Devices, Inc.* 63,800 2,296,80
0
AlliedSignal Inc. 12,600 1,058,40
0 Boeing Co.
19,000 1,008,18
7 Data
General Corp. 41,000 ** 1,066,00
0 Honeywell,
Inc. 10,200 773,925
LSI Logic Corp.* 28,300 905,600
Motorola, Inc. 20,600 1,565,60
0 National
Semiconductor Corp.* 93,500 2,863,43
8 Nokia Corp.
- - Sponsored ADR 26,700 1,969,12
5 Security
Dynamics Technologies, Inc.* 23,200 852,600
Tellabs, Inc.* 21,200 1,181,90
0 Thiokol
Corp. 22,500 1,575,00
0 Xerox Corp.
30,200 2,382,02
5
Total Technology 19,498,6
00
Transportation - 3.8%
Federal Express Corp.* 43,500 2,512,12
5 UAL Corp.*
17,600 1,259,50
0
Total Transportation 3,771,62
5
Total Common Stocks
(cost $86,874,323) 98,174,6
13
Short-Term Investments - 1.6%
SSgA Money Market Fund (cost $1,574,785) 1,574,78 1,574,78
5 5
Total Investments - 100.8%
(cost $88,449,108) 99,749,3
98 Other
Assets, less Liabilities - (0.8)% (810,194
)
Net Assets - 100.0% $98,939,
204
Based on the cost of investments of $88,645,547 for
federal income tax purposes
at June 30, 1997, the aggregate gross unrealized
appreciation and depreciation was
$12,467,100 and $1,363,249, respectively, resulting
in net unrealized appreciation
of investments of $11,103,851.
* Non-income-producing security.
** Some or all of these shares, amounting to
$7,647,776,
or 7.7% of net assets, were
out on loan to various brokers as of June 30, 1997.
Investment Abbreviations:
ADR: Securities whose value is determined or
significantly influenced by trading on
exchanges not located in the United States or
Canada. ADR after the name
of a holding stands for American Depositary
Receipt, representing ownership
of foreign securities on deposit with a domestic
custodian bank.
The accompanying notes are an integral part of
these
financial statements.
Managers Special Equity Fund
Schedule of Portfolio Investments
June 30, 1997 (unaudited)
Shares Value
Common Stock - 86.5%
Basic Industries - 1.9%
Chase Industries, Inc.* 56,500
$1,377,188
Donnelly Corp. 34,775 582,481
Fibreboard Corp.* 28,500 1,567,500
Lydall, Inc.* 100,000 2,112,500
Maverick Tube Corp.* 5,900 221,250
Oregon Metallurgical Corp.* 55,200 1,545,600
RMI Titanium Co.* 78,500 *
2,139,125
*
Total Basic Industries 9,545,644
Capital Goods - 7.5%
AAR Corp. 172,800 5,583,600
Cable Design Technologies Corp.* 81,050 2,385,909
Charter Power Systems, Inc.* 141,100 5,273,612
DT Industries, Inc. 68,800 2,442,400
EVI, Inc.* 30,200 1,268,400
Flow International Corp.* 72,200 685,900
Furon Co. 46,400 1,455,800
Hughes Supply, Inc. 27,900 1,116,000
Jaco Electronics, Inc.* 77,100 554,156
K-Tron International, Inc.* 79,700 1,135,725
MasTec, Inc.* 2,600 123,013
Rexel, Inc.* 19,300 357,050
Rogers Corp.* 68,700 2,421,675
Sanmina Corp.* 42,200 *
2,637,500
*
Sawtek, Inc.* 62,500 2,093,750
Scotsman Industries, Inc. 29,200 832,200
Sequa Corp, Class A* 81,500 4,594,563
Watsco, Inc. 59,900 1,497,500
Wolverine Tube, Inc.* 22,900 638,338
Total Capital Goods
37,097,091
Communication Services - 5.0%
ACC Corp.* 69,800 2,155,075
Advanced Fibre Communications* 33,000 1,994,437
Arch Communications Group, Inc.* 117,900 898,988
Aspect Telecommunications Corp.* 51,300 1,128,600
Associated Group, Inc., Class B* 22,400 856,800
Centennial Cellular Corp., Class A* 143,650 2,226,575
CFW Communications Co. 51,300 942,638
Comcast UK Cable Partners Ltd., Class A* 85,000 1,020,000
CommNet Cellular, Inc.* 42,500 1,476,875
Communications Central, Inc.* 141,400 1,520,050
Davel Communications Group, Inc.* 94,000 1,621,500
LCI International, Inc.* 66,200 1,448,125
MIDCOM Communications, Inc.* 78,000 414,375
P-COM, Inc.* 74,900 2,452,975
People Telephone Company, Inc.* 105,900 364,031
Powerwave Technologies, Inc.* 31,300 704,250
ProNet, Inc.* 151,400 586,675
Sitel Corp.* 36,200 746,625
Tekelec* 35,200 1,240,800
Wireless Telecom Group, Inc. 67,300 744,506
Total Communication Services
24,543,900
Computer Software - 5.7%
Aspen Technologies, Inc.* 75,600 2,839,725
Ciber, Inc.* 59,300 2,027,319
Computer Learning Centers, Inc.* 26,300 1,084,875
Documentum, Inc.* 47,500 1,169,687
HNC Software, Inc.* 37,100 1,409,800
JDA Software Group, Inc.* 62,600 2,136,225
National Data Corp. 71,800 3,109,838
Pegasystems, Inc.* 44,300 1,384,375
Remedy Corp.* 44,800 1,783,600
Renaissance Solutions, Inc.* 43,500 *
1,587,750
*
Scopus Technology, Inc.* 72,950 1,623,137
Technology Solutions Co.* 52,100 2,051,438
Veritas Software Corp.* 27,150 1,357,500
Viasoft, Inc.* 24,400 1,238,300
Wind River Systems* 86,200 3,307,925
Total Computer Software
28,111,494
Consumer Basics - 0.5%
Glacier Water Services, Inc.* 36,900 * 940,950
*
National Sanitary Supply Co. 35,700 464,100
Sylvan, Inc.* 110,400 1,173,000
Total Consumer Basics 2,578,050
Consumer Durable Goods - 0.2%
Aaron Rents, Inc., Class B 84,100 1,093,300
Consumer Non-Durable - 4.7%
Alrenco, Inc.* 91,400 1,199,625
American Safety Razor Co.* 59,200 1,058,200
Blyth Industries, Inc.* 115,050 *
3,882,937
*
Cash America International, Inc. 143,400 1,505,700
Catherine's Stores Corp.* 43,700 163,875
Cone Mills Corp.* 52,900 423,200
Dollar Tree Stores, Inc.* 32,400 1,632,150
Fingerhut Cos., Inc. 125,000 2,179,687
Freds, Inc., Class A 59,800 889,525
Helen of Troy Ltd.* 58,200 1,491,375
MacFrugals Bargains Close-Outs, Inc.* 175,800 4,790,550
Michael Anthony Jewelers, Inc.* 150,600 602,400
Showbiz Pizza Time, Inc.* 16,900 445,738
TJX Companies, Inc. 40,000 1,055,000
Uni-Marts, Inc. 104,100 520,500
West Marine, Inc.* 49,500 *
1,274,625
*
Total Consumer Non-Durable
23,115,087
Consumer Services - 3.0%
Carriage Services, Inc., Class A* 65,400 1,389,750
Landry's Seafood Restaurants, Inc.* 86,300 1,974,112
Pittston Brinks Group 219,100 6,573,000
Protection One, Inc.* 177,900 2,401,650
Ruby Tuesday, Inc.* 111,000 2,490,563
Total Consumer Services
14,829,075
Energy - 3.1%
Berry Petroleum Co., Class A 95,700 1,818,300
Forcenergy, Inc.* 40,500 1,230,187
Global Industries Ltd.* 35,200 818,400
Newpark Resources, Inc.* 100,300 3,385,125
Pool Energy Services Co.* 56,600 1,025,875
Pride International, Inc.* 52,200 1,249,537
Seacor Holdings, Inc.* 22,300 1,166,569
Tosco Corp. 75,000 2,245,313
Varco International, Inc.* 77,000 2,483,250
Total Energy
15,422,556
Entertainment and Leisure - 3.2%
Benihana, Inc. - Class A* 79,000 641,875
CKE Restaurants, Inc. 66,000 2,087,250
Dover Downs Entertainment, Inc. 57,500 1,035,000
Gaylord Entertainment Co., Class A 150,000 3,459,375
Granite Broadcasting Corp.* 148,700 *
1,487,000
*
Harveys Casino Resorts 82,400 1,447,150
Houghton Mifflin Co. 43,200 2,883,600
Jones Intercable, Inc., Class A* 141,000 1,762,500
Platinum Entertainment, Inc.* 27,000 178,875
Saga Communications, Inc., Class A* 42,500 786,250
Total Entertainment and Leisure
15,768,875
Environmental Controls - 2.8%
Allied Waste Industries, Inc.* 82,500 1,402,500
American Disposal Services, Inc.* 73,300 1,612,600
GNI Group, Inc.* 136,100 816,600
Met-Pro Corp. 55,900 845,488
Superior Services, Inc.* 81,600 1,907,400
Tetra Tech, Inc.* 119,218 2,876,134
United Waste Systems, Inc.* 74,900 3,061,537
URS Corp.* 99,700 1,308,563
Total Environmental Controls
13,830,822
Finance and Insurance - 11.2%
Alabama National Bancorporation 64,400 1,392,650
Allied Capital Advisers, Inc.* 205,881 939,332
Allied Capital Lending Corp. 112,291 1,656,292
Andover Bancorp, Inc. 28,800 864,000
CENFED Financial Corp. 22,000 750,750
Charter One Financial, Inc. 85,050 4,582,069
ContiFinancial Corp.* 80,400 2,934,600
Downey Financial Corp. 265,315 6,268,067
First Republic Bancorp, Inc.* 54,056 1,256,802
First Savings Bank of Washington Bancorp, 127,000 2,794,000
Inc.
First Union Corp. 37,556 3,473,930
HCC Insurance Holdings, Inc. 97,750 2,608,703
Hilb, Rogal & Hamilton Co. 128,000 2,176,000
HUBCO, Inc. 64,478 1,845,683
Money Store, Inc. (The) 128,550 *
3,663,675
*
National Western Life Insurance Co., 12,000 1,029,000
Class A*
Norwalk Savings Society 104,500 3,135,000
Penn Treaty American Corp.* 41,300 1,264,813
Penn-America Group, Inc. 67,050 980,606
Roosevelt Financial Group, Inc. 145,000 3,190,000
Sterling Financial Corp.* 141,600 2,584,200
Washington Mutual, Inc. 22,500 *
1,344,375
*
Webster Financial Corp. 65,800 2,977,450
Western National Corp. 46,100 1,236,056
Total Finance and Insurance
54,948,053
General Business - 8.9%
ABM Industries, Inc. 85,900 1,658,944
AccuStaff, Inc.* 53,700 *
1,272,019
*
Affiliated Computer Services, Inc. - 34,400 963,200
Class A*
Alternative Resources Corp.* 66,400 1,348,750
American Business Information* 46,900 996,625
Amplicon, Inc. 34,300 780,325
Baker, Michael Corp.* 100,000 693,750
Concord EFS, Inc.* 113,675 2,941,341
Consolidated Graphics, Inc.* 49,600 2,070,800
Data Transmission Network Corp.* 31,800 993,750
Electro Rent Corp.* 70,350 1,741,162
F.Y.I. Inc.* 46,900 1,102,150
Gray Communications System, Inc. 45,000 *
1,009,688
*
Greenwich Air Services, Inc., Class B 45,700 1,308,162
Iron Mountain, Inc.* 50,000 1,462,500
Labor Ready, Inc.* 39,200 396,900
Learning Tree International, Inc.* 28,700 1,273,563
LSI Industries, Inc. 64,000 840,000
Mail-Well, Inc.* 97,350 2,774,475
Manpower, Inc. 46,500 2,069,250
M/A/R/C, Inc. 15,700 298,300
National Computer Systems, Inc. 31,500 838,687
PMT Sevices, Inc.* 93,400 1,418,513
Precision Response Corp.* 52,600 * 841,600
*
Steck Vaughn Publishing Corp.* 227,100 2,923,912
TeleTech Holdings Inc.* 69,200 *
1,812,175
*
U.S. Office Products Co.* 83,300 *
2,530,237
*
Volt Information Sciences, Inc.* 61,350 3,098,175
Whittman-Hart, Inc.* 47,600 1,338,750
World Fuel Services Corp. 50,400 1,102,500
Total General Business
43,900,203
Health Care - 8.8%
Acuson Corp.* 52,300 1,202,900
Advocat, Inc.* 128,600 1,462,825
Applied Analytical Industries, Inc.* 65,400 1,324,350
Chemed Corp. 54,200 2,029,112
Dura Pharmaceuticals, Inc.* 77,800 3,092,550
Gulf South Medical Supply, Inc.* 58,300 1,122,275
Horizon Mental Health Management, Inc.* 56,000 1,260,000
Jones Medical Industries, Inc. 67,800 *
3,220,500
*
Lifeline Systems, Inc.* 55,700 1,044,375
Lunar Corp.* 35,000 743,750
Morrison Health Care, Inc. 98,852 1,575,454
National Dentex Corp.* 54,300 997,762
NCS HealthCare, Inc., Class A* 66,700 2,034,350
Orthodontic Centers of America, Inc.* 44,700 * 812,981
*
Owens & Minor, Inc. Holding Co. 213,300 3,186,169
Parexel International Corp.* 80,100 2,503,125
Prime Medical Services, Inc.* 117,200 1,259,900
Protocol Systems, Inc.* 155,400 1,223,775
Quorum Health Group, Inc.* 50,700 1,799,850
Regency Health Services, Inc.* 73,700 1,133,137
Renal Treatment Centers, Inc.* 106,400 2,859,500
Res-Care, Inc.* 50,800 952,500
Retirement Care Associates, Inc.* 81,418 *
1,007,548
*
Summit Care Corp.* 24,500 330,750
Universal Health Services, Inc., Class B* 86,500 3,330,250
Vitalink Pharmacy Services, Inc.* 85,500 1,635,188
Total Health Care
43,144,876
Real Estate - 2.5%
Allied Capital Commerical Corp. 78,032 1,872,768
CapStar Hotel Co.* 42,600 1,363,200
Chateau Communities, Inc. 59,229 1,695,430
Equity Inns, Inc. 113,100 1,512,713
Health Care Property Investors, Inc. 36,800 1,297,200
Presidential Realty Corp., Class B 64,458 447,177
RFS Hotel Investors, Inc. 78,300 1,409,400
Signature Resorts, Inc.* 39,700 *
1,369,650
*
Sovran Self Storage, Inc. 47,500 1,389,375
Total Real Estate
12,356,913
Technology - 8.5%
Alpha Industries, Inc.* 210,700 1,751,444
CACI International, Inc., Class A* 68,800 1,049,200
Cambridge Technology Partners* 118,500 3,732,750
Checkpoint Systems, Inc.* 309,900 4,977,769
Computer Horizons Corp.* 35,600 1,214,850
Comverse Technology, Inc.* 56,700 2,955,487
Davox Corp.* 40,800 1,456,050
Encad, Inc.* 61,300 2,543,950
Fusion Systems Corp.* 32,300 1,277,869
IDX Systems Inc.* 52,200 1,800,900
ILC Technology, Inc. 75,600 793,800
Inter-Tel, Inc.* 99,500 2,114,375
NeoMagic Corp.* 72,500 *
1,622,187
*
Network Appliance, Inc.* 72,100 2,730,787
Pomeroy Computer Resources, Inc.* 60,300 1,484,887
REMEC, Inc.* 81,450 1,852,988
Richardson Electronics, Ltd. 31,400 259,050
Sensormatic Electronics Corp. 222,300 2,862,113
Sipex Corp.* 26,100 913,500
Speedfam International, Inc.* 20,900 749,788
Sterling Electronic Corp.* 55,200 703,800
Uniphase Corp.* 11,200 646,800
Vitesse Semiconductor Corp.* 75,150 2,451,769
Total Technology
41,946,113
Transportation - 8.1%
Air Express International Corp. 131,500 5,202,469
Airborne Freight Corp. 209,100 8,756,062
Circle International Group, Inc. 201,800 5,297,250
CNF Transportation Inc. 68,100 2,196,225
Fritz Companies, Inc.* 293,600 *
2,844,250
*
Pittston Burlington Corp. 124,500 3,501,562
Sea Containers, Ltd., Class A 107,000 2,420,875
Sea Containers, Ltd., Class B 13,890 324,679
Trico Marine Services, Inc.* 51,200 1,116,800
Xtra Corp. 183,000 8,040,563
Total Transportation
39,700,735
Utilities - 0.9%
El Paso Electric Co.* 600,000 4,237,500
Total Common Stocks
(cost $340,150,752)
426,170,28
7
Other Investment Companies - 0.3%
Allied Capital Corp. II, Closed-End Fund 32,500 682,500
Sirrom Capital Corp., Closed-End Fund 24,700 845,975
Total Other Investment Companies
(cost $1,407,538) 1,528,475
Short-Term Investments - 13.2%
Other Investment Companies - 9.3%
AIM Liquid Asset Portofolio 18,157,4
18,1
57,4
14
14
Calvert Cash Reserves Institutional Prime 9,603,09
9,603,096 Fund 6
JPM Institutional Prime Money Market Fund 1,881,38
1,8
81,
386
6
Landmark Institutional Liquid Reserves 16,465,9
16,465,913
13
SSgA Money Market Fund 15,038
15,038
Total Other Investment Companies
46,122,847
Principa
l Amount
Repurchase Agreement - 3.9%
State Street Bank & Trust Co., dated
6/30/97, due 07/01/97,
5.000%, total to be received
$19,124,656 (secured by
$3,085,000 FHLB 6.320%, due
12/06/99,
$4,045,000 FNMA 5.125%, due
10/25/13 and,
$12,780,000 FNMA 6.436%, due
06/01/21
market value $19,512,800),
at cost $19,122,
19,122,000
000
Total Short-Term Investments
(cost $65,244,847)
65,244,847
Total Investments - 100.0%
(cost $406,803,137)
492,943,60
9 Other Assets,
less Liabilities - (0.0)% (58,268)
Net Assets - 100.0%
$492,885,3
41
Note: Based on the cost of investments of
$407,579,044 for federal income tax purposes
at June 30, 1997, the aggregate gross unrealized
appreciation and depreciation was
$93,240,752 and $7,876,187, respectively, resulting
in net unrealized appreciation
of investments of $85,364,565
* Non-income-producing security.
** Some or all of these shares, amounting to
$21,734,342,
or 4.4% of net assets, were
out on loan to various brokers as of June 30, 1997.
Investment Abbreviations:
FHLB: Federal Home Loan Bank
FNMA: Federal National Mortgage Association
The accompanying notes are an integral part of these
financial statements.
Managers International Equity Fund
Schedule of Portfolio Investments
June 30, 1997 (unaudited)
Shares Value
Common Stocks - 89.4%
Basic Industries - 13.7%
AGA AB, Series B, Switzerland Certificate 91,100 $1,213,018
(Sweden)
Aracruz Celulose SA, Sponsored ADR 78,800 1,605,550
(Brazil)
Ashanti Goldfields Co. Ltd. Sponsored GDR 95,789 1,119,534
(Ghana)
BASF AG (Germany) 54,350 2,008,404
Bayer AG (Germany)* 61,853 2,376,807
BOC Group PLC (U.K.) 136,161 2,366,127
Ciba Specialty Chemicals AG - Registered 15,781 1,459,202
(Switzerland)*
Clariant AG - Registered (Switzerland) 2,540 1,644,041
Compagnie De Saint-Gobain (France) 13,610 1,984,748
Companhia Vale do Rio Doce, Sponsored ADR 61,900 1,379,955
(Brazil)
Hoechst AG (Germany) 152,344 6,462,020
Holderbank Financiere Glaris AG - Bearer 4,237 4,001,934
Shares (Switzerland)
Impala Platinum Holdings, ADR (South 24,300 271,900
Africa)
Kymmene OY (Finland) 45,040 1,040,839
Lafarge SA (France)* 19,444 1,209,315
Redland PLC (U.K.) 250,500 1,418,337
Rhone Poulenc SA, Class A (France) 102,382 4,181,204
RTZ Corp. PLC (U.K.) 146,890 2,559,907
Rustenburg Platinum Holdings Ltd., ADR 49,276 901,741
(South Africa)*
Sasol Ltd., Sponsored ADR (South Africa) 80,034 1,040,442
Sekisui Chemical Co. (Japan)* 264,000 2,671,785
Stillwater Mining Co. (USA)* 39,200 840,350
Sumitomo Metal Mining Co. (Japan)* 192,000 1,356,831
Thyssen AG (Germany) 8,400 1,989,106
Usinas Siderurgicas de Minas Gerais, 64,500 706,978
Sponsored ADR (Brazil)
Total Basic Industries 47,810,074
Capital Goods - 7.4%
ABB AG - Bearer Shares (Switerzland) 1,594 2,412,836
Alcatel Alsthom (France) 22,400 2,805,384
FLS Industries, Series B (Denmark) 31,000 1,050,468
General Electric Co. PLC (U.K.)* 602,700 3,603,200
Mannesmann AG (Germany) 11,707 5,215,492
Mitsubishi Heavy Industries Ltd. (Japan)* 318,000 2,438,684
Omron Corp. Japan) 63,000 1,335,631
Schindler Holding AG PC (Switzerland) 616 770,000
Schneider SA (France) 38,079 2,026,837
Siemens AG (Germany) 34,533 2,050,279
SKF AB, Series B (Sweden) 85,300 2,205,416
Total Capital Goods 25,914,227
Communication Services - 3.6%
Deutsche Telekom AG (Germany)* 34,483 830,391
Deutsche Telekom AG, Sponsored ADR 30,173 727,924
(Germany)
Nippon Telegraph & Telephone Corp. 367 3,522,073
(Japan)
Stet Societa' Finanziaria Telefonica SpA 761,000 2,641,786
(Italy)
Telecom Corporation of New Zealand (New 226,500 1,153,876
Zealand)*
Telecomunicacoes Brasileiras S/A - 13,400 2,035,114
Telebras, Sponsored ADR (Brazil)
Telefonica De Espana (Spain) 59,100 1,708,626
Total Communication Services 12,619,790
Conglomerates - 2.2%
BTR PLC (U.K.) 557,900 1,909,242
Hutchison Whampoa Ltd. (Hong Kong) 189,000 1,634,505
Metallgesellschaft AG (Germany)* 82,000 1,706,668
Sumitomo Corp. (Japan) 37,000 351,858
Swire Pacific Ltd. (Hong Kong)* 236,300 2,127,441
Total Conglomerates 7,729,714
Consumer Basics - 6.7%
B.A.T. Industries PLC, Sponsored ADR 254,900 2,281,608
(U.K.)
Cadbury Schweppes PLC (U.K.) 303,793 2,711,661
Coca Cola Amatil Ltd. (Australia)* 53,310 692,971
Fosters Brewing Group Ltd. (Australia) 712,160 1,324,009
Grand Metropolitan PLC (U.K.)* 339,736 3,270,109
Heineken NV (Netherlands) 10,060 1,716,898
Lion Nathan Ltd. (New Zealand) 337,800 855,851
Nestle SA - Registered (Switerzland) 4,094 5,400,715
Unilever PLC (U.K.) 180,000 5,152,775
Total Consumer Basics 23,406,597
Consumer Durable Goods - 9.6%
Autoliv, Inc. (USA)* 32,000 1,252,000
Bridgestone Corp. (Japan)* 98,000 2,274,298
Daimler-Benz AG (Germany)* 74,648 6,056,242
Electrolux AB, Series B (Sweden)* 26,300 1,897,149
Fiat SpA (Italy) 324,500 1,168,496
Honda Motor Co. (Japan) 48,000 1,444,774
LucasVarity PLC (U.K.) 821,800 2,846,572
Matsushita Electric Industries (Japan)* 285,000 5,743,762
Michelin, Class B - Registered (France) 42,727 2,565,787
Philips Electronics N.V. (Netherlands) 47,700 3,416,690
Sony Corp. (Japan) 54,300 4,732,656
Total Consumer Durable Goods 33,398,426
Consumer Non-Durable - 2.9%
Canon Inc. (Japan)* 102,000 2,776,479
EMI Group PLC - Sponsored ADR (U.K.) 75,400 1,356,088
Ito-Yokado Co., Ltd. (Japan) 40,000 2,320,712
Metro AG (Germany) 15,800 1,731,196
Neuenburger, Schweizerische Allgemeine 1,010 576,945
Versicherungs - Gesellschaft
(Switzerland)
Sears PLC (U.K.) 1,207,900 1,367,832
Total Consumer Non-Durable 10,129,252
Energy - 6.2%
Broken Hill Proprietary Co. Ltd. 87,300 1,285,429
(Australia)
Elf Aquitaine SA (France) 33,500 3,614,103
Ente Nazionale Idrocarburi SpA (Italy)* 443,400 2,511,062
Royal Dutch Petroleum Co. - NY Registered 50,800 2,762,250
Shares
RWE AG (Germany) 78,300 2,725,079
Shell Transport & Trading Co. - 340,200 2,322,796
Registered (U.K.)
Total Francaise Petroleum, Class B 8,831 892,612
(France)
Woodside Petroleum Ltd. (Australia) 268,650 2,314,567
YPF Sociedad Anonima, Class D, Sponsored 55,100 1,694,325
ADR (Argentina)
Yukong Ltd. (South Korea) 52,969 1,282,470
Total Energy 21,404,693
Entertainment and Leisure - 2.3%
Carlton Communications PLC (U.K.) 212,700 1,801,155
Genting Berhad (Malaysia) 109,000 522,544
Nintendo Corp. Ltd. (Japan) 31,400 2,629,908
Rank Group PLC (U.K.) 202,500 1,283,135
Reuters Holdings PLC (U.K.) 156,980 1,654,782
Total Entertainment and Leisure 7,891,524
Finance and Insurance - 17.7%
Aegon NV (Netherlands) 25,632 1,788,977
Assurances Generales de France (France)* 33,200 1,060,963
AXA-UAP (France)* 30,396 1,890,472
Banque Nationale de Paris (France) 68,600 2,827,253
Bayerische Vereinsbank AG (Germany) 55,980 2,288,501
Commerzbank AG (Germany) 41,531 1,176,327
Compagnie Financiere de Paribas, Class A 11,684 807,205
(France)
CS Holding AG (Switerland)* 21,779 2,796,961
Deutsche Bank AG (Germany) 56,900 3,324,414
EXEL Ltd. (USA) 39,900 2,104,725
HSBC Holding PLC, registered (Hong Kong) 85,461 2,570,239
International Nederlanden Groep NV 45,460 2,095,945
(Netherlands)
Istituto Nazionale delle Assicurazioni 540,100 823,066
(Italy)
Mitsui Marine & Fire Insurance Co. 136,000 982,446
(Japan)*
Munchener Rueckvericherungs-Gesellschaft 724 2,029,906
- - Registered (Germany)*
Nichiei Co. (Japan) 10,000 1,160,356
Nomura Securities Co. Ltd. (Japan)* 69,000 951,143
Norwich Union PLC (a) (U.K.)* 51,700 273,785
Orix Corp. Ltd. (Japan) 52,000 3,851,684
Promise Co. (Japan) 26,800 1,533,834
Prudential Corp. PLC (U.K.) 157,500 1,539,403
Schweizerische Rueckversicherungs - 1,199 1,695,846
Registered (Switzerland)
Shohkoh Fund (Japan) 3,600 1,089,862
Skandia Foersaekrings AB (Sweden) 76,170 2,806,341
Sumitomo Trust and Banking Co. (Japan)* 355,000 3,809,545
Svenska Handelsbanken, Class A (Sweden) 70,300 2,235,641
Uniao de Bancos Brasileiros S.A. - 18,500 686,813
Sponsored GDR (Brazil)*
Unidanmark A/S, Class A (Denmark) 28,200 1,584,150
Westpac Banking Corporation Ltd. 564,500 3,400,168
(Australia)*
Zurich Versicherun - Registered 16,030 6,379,062
(Switerland)
Total Finance and Insurance 61,565,033
General Business - 1.9%
Flughafen Wien AG (Austria)* 29,755 1,256,826
Havas SA (Frances) 10,000 720,643
Mirror Group PLC (U.K.) 268,700 841,237
SAP AG (Germany) 9,100 1,888,768
Societe Generale de Surveillance Holding 866 1,850,630
SA (Switzerland)
Total General Business 6,558,104
Health Care - 4.5%
Astra AB, Series A (Sweden) 97,147 1,808,431
Astra AB, Series B (Sweden) 107,200 1,891,642
Novartis AG - Bearer (Switzerland) 1,386 2,213,803
Novartis AG - Registered (Switzerland) 3,685 5,890,952
Schering AG (Germany) 15,210 1,625,127
SmithKline Beecham Unit PLC (U.K.) 118,800 2,187,097
Total Health Care 15,617,052
Real Estate - 0.5%
Kerry Properties Ltd. (Hong Kong) 656,000 1,591,884
Technology - 2.8%
British Aerospace PLC (U.K.) 202,351 4,503,675
Ricoh Company Ltd. (Japan)* 311,000 4,069,971
Samsung Display Devices Co. (South Korea) 6,980 362,363
Samsung Electronics Ltd., GDR 27,281 736,587
representing 1/2 non-voting Shares (South
Africa)
Samsung Electronics Ltd., GDR 1,422 82,476
representing 1/2 non-voting Shares, (a)
(South Africa)*
Total Technology 9,755,072
Transportation - 1.1%
Canadian Pacific, Ltd. (Canada) 49,800 1,417,246
Konink Nedlloyd Groep NV (Netherlands) 66,400 1,918,019
London & Overseas Freighters, ADR (U.K.) 34,400 468,700
Total Transportation 3,803,965
Utilities - 6.3%
CIE Generale Des Eaux (France) 26,900 3,446,781
CIE Generale Des Eaux, warrants (France) 26,900 16,113
Centrais Eletricas Brasileiras, ADR 86,100 2,555,284
(Brazil)
Elektrowatt AG, Class B (Switzerland) 1,700 629,932
Huaneng Power International, Inc., ADR 42,000 1,071,000
(China)*
National Grid Group PLC (UK) 556,900 2,012,471
National Power PLC (U.K.) 323,900 2,815,621
Powergen PLC (U.K.) 210,326 2,500,829
Veba AG (Germany) 37,200 2,090,247
Viag AG (Germany) 10,610 4,824,110
Viag AG, New Shares (Germany)* 202 91,555
Total Utilities 22,053,943
Total Common Stocks
(cost $246,324,232) 311,249,35
0
Preferred Stocks - 0.5%
Consumer Durable Goods - 0.5%
Fiat SpA (Italy) (cost $2,047,364) 956,100 1,766,420
Short-Term Investments - 8.8%
Other Investments Companies - 3.0%
Calvert Cash Reserves Institutional Prime 9,182,960 9,182,960
Fund
SSgA Money Market Fund 1,329,056 1,329,056
Total Other Investment Companies 10,512,016
Principal
Amount
Discount Note - 2.3%
Federal National Mortgage Association, $8,000,00 8,000,000
0.000%, 0701/97 0
Repurchase Agreement - 3.5%
Donaldson, Lufkin, Jenrette, dated
06/30/97, due 07/01/97,
5.900%, total to be received
$12,184,997 (secured by
$12,255,000 U.S. Treasury
Note, 5.000%, due 02/15/99,
market value $12,306,067),
at cost 12,183,00 12,183,000
0
Total Short-Term Investments
(cost $30,695,016) 30,695,016
Total Investments - 98.7%
(cost $279,066,612) 343,710,78
6 Other
Assets, less Liabilities - 1.3% 4,453,389
Net Assets - 100.0% $348,164,1
75
Note: Based on the cost of investments of
$279,539,676 for federal income tax purposes
at June 30, 1997, the aggregate gross unrealized
appreciation and depreciation was
$69,254,720 and $5,083,609, respectively, resulting
in net unrealized appreciation
of investments of $64,171,111.
* Non-income-producing security.
(a) Security 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 buyers. At June 30, 1997, the value of
these securities amounted to
$356,261, or 0.1% of net assets.
Investment Abbreviations:
ADR/GDR:Securities whose value is determined or
significantly influenced by trading on
exchanges not located in the United States or Canada.
ADR
after the name
of a holding stands for American Depositary Receipt,
representing ownership
of foreign securities on deposit with a domestic
custodian
bank; a GDR (Global
Depositary Receipt) is comparable, but foreign
securities
are held on deposit in a
non-U.S. Bank.
The accompanying notes are an integral part of these
financial statements.
The Managers Funds
Statements of Assets and Liabilities
June 30, 1997(unaudited)
Manager Managers
Managers Managers
s
Income Capital Special Internat
ional Equity
Apprecia Equity Equity
tion
Fund Fund Fund Fund
Assets:
Investments at value* $ 59,889, $ 98,174,6 $
427,698,7 $ 313,015, 606 13 62
771
Short-term 2,815,8 1,574,78
65,244,84 30,695,0
investments at cost 57 5
7 16
and value
Cash -- 10,641
2,407 87,572
Foreign currency -- -- -
- - 344,749
(cost $345,195)
Collateral from 1,258,5 7,863,19
23,050,78 --
brokers on securities 00 5
8
loaned
Receivable for 230,914 2,057,96
3,086,955 396,149
investments sold 3
Receivable for Fund 123,589 210,416
6,643,503 2,959,11
shares sold 6
Unrealized gain on -- -- -
- - 168,776
foreign currency
contracts, net
Dividends, interest 182,268 77,762
134,781 1,087,98
and other receivables 8
Foreign withholding 2,298 1,000 -
- - 412,235
tax receivable
Prepaid expenses 14,012 18,474
38,081 37,343
64,517, 109,988,
525,900,1 349,204,
Total assets 044 849
24 715
Liabilities:
Payable for Fund 61,724 340,288
956,529 433,943
shares repurchased
Payable upon return 1,258,5 7,863,19
23,050,78 --
of securities loaned 00 5
8
Payable for 82,500 2,707,45
8,352,088 --
investments purchased 3
Payable to custodian 126,067 -- -
- - --
Accrued expenses:
Investment 39,469 65,151
340,125 249,295
advisory and
management fees
Administrative 13,156 20,363
94,479 69,249
fees
Other 61,731 53,195
220,774 288,052
1,643,1 11,049,6
33,014,78 1,040,53
Total liabilities 47 45
3 9
Net Assets $ 62,873, $ 98,939,2 $
492,885,3 $ 348,164,
897 04
41 176
Shares outstanding 1,814,6 3,575,77
8,800,472 7,064,43
80 0 7
Net asset value,
offering and
redemption
$34.65 $27.67
$56.01 $49.28
Net Assets Represent:
Paid-in capital $ 43,895, $ 81,906,9 $
397,145,1 $ 272,202,
137 65
16 367
Undistributed net 45,677 (66,786)
211,225 2,482,55
investment income 1
(loss)
Accumulated net 3,159,4 5,798,73
9,388,528 8,678,04
realized gain from 44 5 3
investments
Net unrealized
appreciation of
investments and
foreign currency
contracts and 15,773, 11,300,2
86,140,47 64,801,2
translations 639 90
2 15
Net Assets $ 62,873, $ 98,939,2 $
492,885,3 $ 348,164,
897 04
41 176
* Investments at $ 44,115, $ 86,874,3 $
341,558,2 $ 248,371,
cost 967 23
90 596
The accompanying notes are an integral part of these
financial statements.
The Managers Funds
Statements of Operations
For the six months ended June 30, 1997
(unaudited)
Manager Managers Managers Managers
s
Income Capital Special Internat
ional Equity
Appreciati Equity Equity
on
Fund Fund Fund Fund
Investment Income:
Dividend income $ 1,013,3 $ 407,930 $ 1,238,01
$ 4,632,23 01 9 2
Interest income 100,047 121,415 1,347,18 711,360
5
Foreign withholding (12,823 (2,442) -- (587,087
tax ) )
Stock loan fees 1,998 33,194 54,886 --
1,102,5 560,097 2,640,09 4,756,50
Total investment 23 0 5
income
Expenses:
Investment advisory 217,225 397,060 1,618,97 1,330,21
and management fees 6 6
Administrative fees 72,408 124,081 449,715 369,505
Custodian fees 39,443 36,794 132,191 252,237
Transfer agent fees 24,259 40,560 134,820 113,130
Audit fees 14,219 14,963 15,583 20,293
Registration fees 12,653 15,418 30,262 29,881
Insurance 5,310 10,396 24,359 25,537
Trustee fees 1,626 2,943 10,111 8,233
Legal fees 1,218 4,191 7,174 6,055
Miscellaneous 4,957 11,886 19,491 20,937
expenses
393,318 658,292 2,442,68 2,176,02
Total expenses 2 4
before reduction
Expense reductions (3,174) (31,409) (13,817) (1,179)
Net expenses 390,144 626,883 2,428,86 2,174,84
5 5
712,379 (66,786) 211,225 2,581,66
Net investment 0
income (loss)
Net Realized and
Unrealized Gain
(Loss):
Net realized gain 2,264,9 5,188,624 4,764,85 8,806,64
on investment 91 0 8
transactions
Net realized gain
on foreign currency
contracts
and -- -- -- 112,058
translations
Net unrealized 5,381,8 (217,687) 39,905,7 27,056,5
appreciation 91 03 82
(depreciation) of
investments
Net unrealized
appreciation from
foreign
currency -- -- -- 157,119
translations
7,646,8 4,970,937 44,670,5 36,132,4
Net realized and 82 53 07
unrealized gain
Net Increase in Net
Assets
$ 8,359,2 $ 4,904,151 $ 44,881,7
$ 38,714,0 61 78 67
The accompanying notes are an integral part of these
financial statements.
The Managers Funds
Statements of Changes in Net Assets
Managers
Income
Equity
Fund
For the
six months
For the
June 30,
year ended
1997
(unaudited)
December 31, 1996
Increase (Decrease) in Net Assets
From Operations:
Net investment income (loss) $712,379
$1,228,144
Net realized gain on investments
and foreign currency 2,264,991
3,059,690
transactions
Net unrealized appreciation
(depreciation) of
investments and foreign 5,381,891
3,401,883
currency translations
Net increase in
net assets
resulting 8,359,261
7,689,717
from operations
Distributions to Shareholders:
From net investment income (728,568)
(1,207,927)
From net realized gain on --
(3,147,241)
investments
Total (728,568)
(4,355,168)
distributions to shareholders
From Capital Share Transactions:
Proceeds from sale of shares 20,645,089
34,882,439
Net asset value of shares issued
in connection
with reinvestment of 633,427
3,705,668
dividends and distributions
Cost of shares repurchased (19,098,341)
(26,667,124)
Net increase
(decrease) from
capital share 2,180,175
11,920,983
transactions
Total increase (decrease) in net 9,810,868
15,255,532
assets
Net Assets:
Beginning of period 53,063,029
37,807,497
End of period $62,873,897
$53,063,029
End of period undistributed
(overdistributed)
$45,677
$61,866
Share Transactions:
Sale of shares 647,302
1,177,997
Shares issued in connection with
reinvestment
of dividends and 19,642 123,222
distributions
Shares repurchased (592,394) (890,919)
Net increase 74,550 410,300
(decrease) in shares
Managers
Capital
Appreciation
Fund
For the
six months For the
June 30, 1997
year ended
(unaudited)
December 31,
1
9
9
6
Increase (Decrease) in Net Assets
From Operations:
Net investment income (loss) ($66,786) $324,010
Net realized gain on investments
and foreign currency 5,188,624 12,474,078
transactions
Net unrealized appreciation
(depreciation) of
investments and foreign (217,687) (239,860)
currency translations
Net increase in
net assets
resulting 4,904,151 12,558,228
from operations
Distributions to Shareholders:
From net investment income -- (330,477)
From net realized gain on --
(14,706,217)
investments
Total --
(15,036,694)
distributions to shareholders
From Capital Share Transactions:
Proceeds from sale of shares 14,256,038 47,104,779
Net asset value of shares issued
in connection
with reinvestment of -- 13,914,902
dividends and distributions
Cost of shares repurchased (21,503,286)
(40,611,675)
Net increase
(decrease) from
capital share (7,247,248) 20,408,006
transactions
Total increase (decrease) in net (2,343,097) 17,929,540
assets
Net Assets:
Beginning of period 101,282,301 83,352,761
End of period $98,939,204
$101,282,301
End of period undistributed
(overdistributed)
($66,786) --
Share Transactions:
Sale of shares 533,428 1,667,966
Shares issued in connection with
reinvestment
of dividends and -- 525,476
distributions
Shares repurchased (802,734)
(1,419,363)
Net increase (269,306) 774,079
(decrease) in shares
Managers
Special
Equity
Fund
For the
six months
For the June 30,
1997 year
ended
(
u
n
a
u
d
i
t
e
d
)
D
e
c
e
m
b
e
r
3
1
,
1
9
9
6
Increase (Decrease) in Net Assets
From Operations:
Net investment income (loss) $211,225
($172,893)
Net realized gain on investments
and foreign currency 4,764,850
16,533,528
transactions
Net unrealized appreciation
(depreciation) of
investments and foreign 39,905,703
21,777,123
currency translations
Net increase in
net assets
resulting 44,881,778
38,137,758
from operations
Distributions to Shareholders:
From net investment income -- --
From net realized gain on --
(15,417,452)
investments
Total --
(15,417,452)
distributions to shareholders
From Capital Share Transactions:
Proceeds from sale of shares 283,518,650
200,247,845
Net asset value of shares issued
in connection
with reinvestment of --
12,045,589
dividends and distributions
Cost of shares repurchased (106,948,301)
(81,942,114)
Net increase
(decrease) from
capital share 176,570,349
130,351,320
transactions
Total increase (decrease) in net 221,452,127 153,071,626
assets
Net Assets:
Beginning of period 271,433,214 118,361,588
End of period $492,885,341
$271,433,214
End of period undistributed
(overdistributed)
$211,225 --
Share Transactions:
Sale of shares 5,592,862 3,994,546
Shares issued in connection with
reinvestment
of dividends and -- 240,100
distributions
Shares repurchased (2,119,745) (1,638,391)
Net increase 3,473,117 2,596,255
(decrease) in shares
Managers
International
Equity
Fund
For the
six months For the
June 30, 1997
year ended
(unaudited)
December 31,
1
9
9
6
Increase (Decrease) in Net Assets
From Operations:
Net investment income (loss) $2,581,660 $1,992,050
Net realized gain on investments
and foreign currency 8,918,706 5,649,063
transactions
Net unrealized appreciation
(depreciation) of
investments and foreign 27,213,701 18,280,159
currency translations
Net increase in
net assets
resulting 38,714,067 25,921,272
from operations
Distributions to Shareholders:
From net investment income -- (1,972,418)
From net realized gain on -- (6,154,840)
investments
Total -- (8,127,258)
distributions to shareholders
From Capital Share Transactions:
Proceeds from sale of shares 130,317,941 162,992,914
Net asset value of shares issued
in connection
with reinvestment of --
6,457,243
dividends and distributions
Cost of shares repurchased (90,436,248)
(58,163,660)
Net increase
(decrease) from
capital share 39,881,693
111,286,497
transactions
Total increase (decrease) in net 78,595,760
129,080,511
assets
Net Assets:
Beginning of period 269,568,416
140,487,905
End of period $348,164,176
$269,568,416
End of period undistributed
(overdistributed)
$2,482,551
($99,109)
Share Transactions:
Sale of shares 2,909,239
3,879,381
Shares issued in connection with
reinvestment
of dividends and --
150,567
distributions
Shares repurchased (2,014,761)
(1,374,547)
Net increase 894,478
2,655,401
(decrease) in shares
The accompanying notes are an integral part of these
financial statements.
Managers Income Equity Fund
Financial Highlights
For a share of capital
stock outstanding
throughout each period
For the
six
months
ended
June 30, Year
1997 ended
Decemb
er 31,
(unaudit 1996 1995 1994
1993 1992*
ed)
Net Asset Value, $30.49 $28.43 $24.9 $27.8
$27.3 $28.6
Beginning of 0 9
8 2
Period
Income from
Investment
Operations:
Net investment 0.39 0.76 0.87 0.80
0.81 0.99
income
Net realized and
unrealized
gain(loss)
on investments 4.17 3.97 7.47 (0.50 2.54 1.72
)
Total from 4.56 4.73 8.34 0.30 3.35 2.71
investment
operations
Less Distributions
to Shareholders
from:
Net investment (0.40) (0.76) (0.86 (0.83
(0.76 (0.98
income ) ) ) )
Net realized gain --- (1.91) (3.95 (2.46
(2.08 (2.97
on investments ) ) ) )
Total (0.40) (2.67) (4.81 (3.29
(2.84 (3.95
distributions to ) ) ) )
shareholders
Net Asset Value, $34.65 $30.49 $28.4 $24.9
$27.8 $27.3
End of Period 3 0 9 8
Total Return 15.06% (c) 17.08% 34.36 0.99%
12.40 9.80%
% %
Ratio of net 1.35% (a) 1.44% (a 1.45% 1.33% 1.32% 1.20%
expenses to (d) )
average net assets
Ratio of net
investment income
to average
2.46% (d) 2.63% 2.85% 3.06% 2.75% 3.52%
Portfolio turnover 21% (c) 33% 36% 46% 41% 41%
Average commission $0.06 $0.06 --- --- --- ---
rate (b)
Net assets at end $62,874 $53,06 $37,8 $48,8
$40,9 $49,6
of period (000's 3 07 75 65 48
omitted)
(a) The Fund has entered into an arrangement with one
or more third-party broker-dealers who have paid a
portion of the Fund's expenses. Absent this expense
reduction, the ratio of expenses
to average net assets for the six months ended
June 30, 1997 would
have been 1.36%. The ratio of expenses to
average net assets for the year ended December
31, 1996 would have been 1.44%. (See Note 1c of
Notes to Financial Statements.)
(b) All funds are now required to disclose their
average commission rate per share for security
trades on which commissions are
charged. The amount may vary from period to
period and from fund to fund depending on the mix
of trades executed in various markets where
trading practices and commissions rate structures
may differ.
(c) Not
annualized.
(d) Annualized.
* Audited by
prior auditors.
Managers Capital Appreciation Fund
Financial Highlights
For a share of capital stock outstanding
throughout each period
For the
six
months
ended
June 30, Year
1997 ended
Decemb
er 31,
(unaudit 1996 1995 1994
1993 1992*
ed)
Net Asset Value, $26.34 $27.14 $23.2 $25.1
$24.6 $23.46
Beginning of 5 7 7
Period
Income from
Investment
Operations:
Net investment (0.02) 0.09 0.09 0.12 0.19 0.08
income
Net realized and
unrealized
gain(loss)
on investments 1.35 3.66 7.62 (0.49 3.80 2.39
)
Total from 1.33 3.75 7.71 (0.37 3.99 2.47
investment )
operations
Less
Distributions to
Shareholders:
From net --- (0.10) (0.08 (0.12
(0.19 (0.07)
investment income ) ) )
From net realized --- (4.45) (3.74 (1.39
(3.30 (1.19)
gain on ) ) )
investments
In excess of net
realized gain
on investments --- --- --- (0.04 --- ---
)
Total --- (4.55) (3.82 (1.55
(3.49 (1.26)
distributions to ) ) )
shareholders
Net Asset Value, $27.67 $26.34 $27.1 $23.2
$25.1 $24.67
End of Period 4 5 7
Total Return 5.09% (c) 13.73% 33.39 (1.50
16.38 10.50%
% )% %
Ratio of net 1.26% (a)( 1.33% (a) 1.36% 1.29% 1.18% 1.05%
expenses to d)
average net
assets
Ratio of net
investment income
to average
(0.13)% (d) 0.34% 0.31% 0.53%
0.74% 0.33%
Portfolio 134% (c) 172% 134% 122%
131% 175%
turnover
Average $0.06 $0.06 --- ---
- --- ---
commission rate
(b)
Net assets at end $98,939 $101,2 $83,3 $86,0
$69,3 $56,19
of period (000's 82 53 42
58 6
omitted)
(a) The Fund has entered into an arrangement with one or
more third-party broker-dealers who have paid a
portion of the Fund's
expenses. Absent this expense reduction, the
ratio of expenses to average net assets for the
six months ended June 30, 1997 would
have been 1.33%. The ratio of expenses to
average net assets for the year ended December
31, 1996 would have been 1.38%.
(See Note 1c of Notes to Financial Statements.)
(b) All funds are now required to disclose
their average commission rate per share for
security trades on which commissions are
charged. The amount may vary from period to
period and from fund to fund depending on the
mix of trades executed in
various markets where trading practices and
commissions rate structures may differ.
(c) Not annualized.
(d) Annualized.
* Audited by prior auditors.
Managers Special Equity
Fund
Financial Highlights
For a share of capital
stock outstanding
throughout each period
For
the
six
months
ended
June Year
30, ended
1997 Decem
ber
31,
(unaud 1996
19951994 199 199
ited) (a)
3 2*
Net Asset Value, Beginning $50.95 $43.3 $36.
$38. $36 $34 of Period 4 79
90 .14 .49
Income from Investment
Operations:
Net investment 0.02 0.00 (0.0
(0.0 0.0 0.0
income(loss) 7)
1) 2 5
Net realized and
unrealized gain(loss)
on investments 5.04 10.68 12.2
(0.7 6.1 5.3
8
6) 2 5
Total from investment 5.06 10.68 12.2
(0.7 6.1 5.4
operations 1
7) 4 0
Less Distributions to
Shareholders from:
Net investment income --- --- --- -
- -- (0. (0.
01) 05) Net realized
gain on --- (3.07 (5.6 (1.3 (3. (3.
investments ) 6)
4) 37) 70)
Total distributions to --- (3.07 (5.6
(1.3 (3. (3.
shareholders ) 6)
4) 38) 75)
Net Asset Value, End of $56.01 $50.9 $43.
$36. $38 $36 Period 5 34
79 .90 .14
Total Return 9.93% (d 24.75 33.9
(1.9 17. 15. ) % 4% 9)% 05% 64%
Ratio of net expenses to 1.35% (c 1.43% 1.44
1.37 1.2 1.2
average net assets )( %
% 6% 9%
e)
Ratio of net investment
income to average
0.12% (e (0.10 (0.1
(0.0 0.0 0.1 ) )% 6)% 6)% 7% 4%
Portfolio turnover 24% (d 56% 65%
66% 45% 54%
)
Average commission rate $0.05 $0.05 --- -
- -- --- --(b)
Net assets at end of $492,8 $271, $118
$111 $99 $53 period (000's omitted) 85 433
,362 ,584 ,03 ,64
2 1
(a) Calculated using the weighted average shares
outstanding during the year.
(b) All funds are now required to disclose their
average commission rate per share for security
trades on which commissions are
charged. The amount may vary from period to
period and
from fund to fund depending on the mix of
trades executed in
various markets where trading practices and
commissions rate structures may differ.
(c) The Fund has entered into an arrangement
with one or more third-party broker-dealers
who have paid a portion of the Fund's
expenses. Absent this expense reduction, the
ratio of expenses to average net assets for
the six months ended June 30, 1997 would
have been 1.36%.(See Note 1c of Notes to
Financial Statements.)
(d) Not annualized.
(e) Annualized.
* Audited by prior auditors.
Managers International Equity Fund
Financial Highlights
For a share of capital stock
outstanding throughout each period
For the
six
months
ended
June Year
30, ended
1997 Decembe
r 31,
(unaudi 1996 1995(a 1994
1993 1992*
ted) )
Net Asset $43.69 $39.9 $36.35 $35.92
$26.52 $25.66
Value, 7
Beginning of
Period
Income from
Investment
Operations:
Net investment 0.37 0.32 0.31 0.16
0.22 0.23
income
Net realized
and unrealized
gain(loss)
on investments 5.22 4.76 5.59 0.56
9.88 0.85
Total from 5.59 5.08 5.90 0.72
10.10 1.08
investment
operations
Less
Distributions
to
Shareholders:
From net --- (0.33 (0.13) (0.08)
(0.29) (0.22)
investment )
income
In excess of --- ---
(0.11) ---
net investment
income
From net --- (1.03 (2.15) ---
(0.30) ---
realized gain )
on investments
In excess of
net realized
gain
on investments --- --- --- (0.21)
- --- ---
Total --- (1.36 (2.28) (0.29)
(0.70) (0.22)
distributions )
to
shareholders
Net Asset $49.28 $43.6 $39.97 $36.35
$35.92 $26.52
Value, End of 9
Period
Total Return 12.79% (d) 12.77 16.24% 2.00%
38.20% 4.25%
%
Ratio of net 1.47% (c) 1.53% 1.58% 1.49%
1.47% 1.45% expenses to (e)
average net
assets
Ratio of net
investment
income to
average
1.75% (e) 0.97% 0.80% 0.60%
0.78% 0.97%
Portfolio 20% (d) 30% 73% 22%
46% 51% turnover
Average $0.04 $0.03 --- ---
- --- --commission
rate (b)
Net assets at $348,16 $269, $140,4 $86,92
$62,27 $23,12 end of period 4 568
88 4 3 9 (000's
omitted)
(a) Calculated using the weighted average shares
outstanding during the year.
(b) All funds are now required to disclose their
average commission rate per share for security
trades on which commissions are
charged. The amount may vary from period to
period and
from fund to fund depending on the mix of
trades executed in
various markets where trading practices and
commissions rate structures may differ.
(c)The Fund has entered into an arrangement
with one or more third-party broker-dealers
who have paid a portion of the Fund's
expenses. Absent this expense reduction, the
ratio of expenses to average net assets for
the six months ended June 30, 1997 would
have been 1.47%. (See Note 1c of Notes to
Financial Statements.)
(d) Not annualized.
(e)Annualized.
* Audited by prior auditors.
The Managers Funds
Notes to Financial Statements
June 30, 1997 (unaudited)
(1) Summary of Significant Accounting Policies
The Managers Funds (the "Trust") is a no-load,
open-end, management investment company,
organized as a Massachusetts business trust,
and registered under the Investment Company Act
of 1940, as amended (the "1940 Act"). Currently
the Trust is comprised of 10 investment series.
Included in this report are Managers Income
Equity Fund ("Income Equity"), Managers Capital
Appreciation Fund ("Capital Appreciation"),
Managers Special Equity Fund ("Special Equity")
and Managers International Equity Fund
("International Equity"), collectively the
"Funds."
The Funds' financial statements are prepared in
accordance
with generally accepted accounting principles
which require the use of management's estimates.
The following is a summary of significant
accounting policies followed by the Funds:
(a) Valuation of Investments
Equity securities traded on a domestic or
international securities exchange are valued at
the last quoted sales price, or, lacking any
sales, on the basis of the last quoted bid
price. Over-the-counter securities for which
market quotations are readily available are
valued at the last quoted bid price. Fixed
income securities are valued based on valuations
furnished by independent pricing services that
utilize matrix systems which reflect such
factors as security prices, yields, maturities,
and ratings, and are supplemented by dealer and
exchange quotations. Short-term investments,
having a remaining maturity of 60 days or less,
are valued at amortized cost which approximates
market. Securities for which market quotations
are not readily available are valued at fair
value, as determined in good faith and pursuant
to procedures established by the Board of
Trustees.
(b) Security Transactions
Security transactions are accounted for as of
trade date. Gains and losses on securities sold
are determined on the basis of identified cost.
(c) Investment Income and Expenses
Dividend income is recorded on the ex-dividend
date, except certain dividends from foreign
securities where the exdividend date may have
passed are recorded as soon as the Trust is
informed of the ex-dividend date. Dividend
income on foreign securities is recorded net of
withholding tax. Interest income is recorded on
the accrual basis and includes amortization of
discounts and premiums when required for federal
income tax purposes. Other income and expenses
are recorded on an accrual basis. Expenses which
cannot be directly attributed to a particular
fund are apportioned among the funds in the
Trust based upon their average net assets.
Income Equity, Capital Appreciation and Special
Equity each had certain portfolio trades
directed to brokers who paid a portion of such
Fund's custody expense. For the six months
ended June 30, 1997, Income Equity, Capital
Appreciation and Special Equity expenses were
reduced by $2,241, $8,208 and $8,930,
respectively, under this arrangement.
(d) Dividends and Distributions
Dividends resulting from net investment income,
if any, normally will be declared and paid
monthly for Income Equity and annually for
Capital Appreciation, Special Equity and
International Equity. Distributions of capital
gains, if any, will be made on an annual basis
and when required for federal excise tax
purposes. Income and capital gain distributions
are determined in accordance with Federal income
tax regulations which may differ from generally
accepted accounting principles. These
differences are primarily due to differing
treatments for foreign currency related
transactions, losses deferred due to wash sales
and equalization accounting for tax purposes.
Permanent book and
tax basis differences, if any, relating to
shareholder distributions will result in
reclassifications to paid-in capital.
(e) Repurchase Agreements
Each Fund may enter into repurchase agreements
provided that the value of the underlying
collateral, including accrued interest, will be
equal to or exceed the value of the repurchase
agreement during the term of the agreement. The
underlying collateral for all repurchase
agreements is held in safekeeping by the Fund's
custodian or at the Federal Reserve Bank.
If the seller defaults and the value of the
collateral declines, or if bankruptcy
proceedings commence with respect to the seller
of the security, realization of the collateral
by the Fund may be delayed or limited.
(f) Federal Taxes
Each Fund intends to comply with the
requirements under Subchapter M of the Internal
Revenue Code of 1986, as amended, and to
distribute substantially all of its taxable
income and gains to its shareholders and to meet
certain diversification and income requirements
with respect to investment companies. Therefore,
no provision for federal income or excise tax is
included in the accompanying financial
statements.
(g) Capital Stock
The Trust's Declaration of Trust authorizes for
each series the issuance of an unlimited number
of shares of beneficial interest, without par
value. Each Fund records sales and repurchases
of its capital stock on the trade date.
Dividends and distributions to shareholders are
recorded on the ex-dividend date.
At June 30, 1997, certain unaffiliated
shareholders, including omnibus accounts,
individually held greater than 10% of the
outstanding shares of the Funds: Income Equity
two own 30%; Capital Appreciation- one owns 27%;
Special Equity- one owns 33%; and International
Equity- two own 34%.
(h) Foreign Currency Translation
The books and records of the Funds are
maintained in U.S. dollars. The value of
investments, assets and liabilities denominated
in currencies other than U.S. dollars are
translated into U.S. dollars based upon current
foreign exchange rates. Purchases and sales of
foreign investments and income and expenses are
converted into U.S. dollars based on currency
exchange rates prevailing on the respective
dates of such transactions. Net realized and
unrealized gain (loss) on foreign currency
transactions represent: (1) foreign exchange
gains and losses from the sale and holdings of
foreign currencies; (2) gains and losses between
trade date and settlement date on investment
securities transactions and forward foreign
currency exchange contracts; and (3) gains and
losses from the difference between amounts of
interest and dividends recorded and the amounts
actually received.
In addition, the Funds do not isolate that
portion of the results of operation resulting
from changes in exchange
rates from the fluctuations resulting from
changes in market prices of securities held.
Such fluctuations are included with the net
realized and unrealized gain or loss on
investments.
(2) Agreements and Transactions with Affiliates
The Managers Funds, L.P. (the "Investment
Manager") provides or oversees investment
advisory and management services to the Funds
under Management Agreements with each Fund. The
Investment Manager selects portfolio managers
for each Fund (subject to Trustee approval),
allocates assets among portfolio managers and
monitors the portfolio managers' investment
programs and results. Each Fund's investment
portfolio is managed by portfolio managers who
serve pursuant to Portfolio Management
Agreements with the Investment Manager and the
Fund. Certain trustees and officers of the Funds
are officers of the Investment Manager.
Investment advisory and management fees are paid
directly by each Fund to The Managers Funds,
L.P. based on average daily net assets. The
annual investment advisory and management fee
rates, as a percentage of average daily net
assets for the six months ended June 30, 1997,
were as follows:
Investment Advisory
Fund and Management Fee
Income Equity 0.75%
Capital Appreciation
0.80 Special Equity
0.90
International Equity
0.90
The Trust has adopted an Administrative and
Shareholder Servicing Agreement. The Managers
Funds, L.P. serves as each Fund's administrator
(the "Administrator") and is responsible for all
aspects of managing the Funds' operations,
including administration and shareholder
services to each Fund, its shareholders, and
certain institutions, such as bank trust
departments, broker-dealers and registered
investment advisers, that advise or act as an
intermediary with the Funds' shareholders.
During the six months ended June 30, 1997, each
of the Funds paid a fee to the Administrator at
the rate of 0.25% per annum of the Fund's
average daily net assets.
An aggregate annual fee of $10,000 is paid to
each outside Trustee for serving as a Trustee of
the Trust. In addition, these Trustees receive
meeting fees of $750 for each inperson meeting
attended, and $200 for participation in any
telephonic meetings. The Trustee fee expense
shown in the financial statements represents
each Fund's allocated portion of the total fees.
(3) Purchases and Sales of Securities
Purchases and sales of securities, excluding
short-term securities, for the six months ended
June 30, 1997 were as follows:
Fund Purchases Sales
Income Equity $ 13,770,269
$11,492,463
Capital Appreciation 128,990,758
134,188,428 Special Equity
213,921,486 75,317,957
International Equity 80,199,168
55,847,902
There were no purchases or sales of U.S.
Government securities.
(4) Portfolio Securities Loaned
Certain of the Funds may participate in a
securities lending program providing for the
lending of corporate bonds, equity and
government securities to qualified brokers.
Collateral on all securities loaned except for
government securities loaned is accepted only in
cash. Collateral on government securities loaned
is in the form of other similar securities.
Collateral is maintained at a minimum level of
100% of the market value, plus interest, if
applicable, of investments on loan. Collateral
received in the form of cash is invested
temporarily in money market funds by the
custodian. Earnings of such temporary cash
investments are divided between the custodian,
as a fee for its services under the program, and
the Fund, according to agreed-upon rates.
(5) Forward Foreign Currency Contracts
(International Equity only)
During the six months ended June 30, 1997,
International Equity invested in forward foreign
currency exchange contracts. These investments
may involve greater market risk than the amounts
disclosed in the Fund's financial statements.
A forward foreign currency exchange contract is
an agreement between the Fund and another party
to buy or sell a currency at a set price at a
future date. The market value of the contract
will fluctuate with changes in currency exchange
rates. The contract is marked-to-market daily,
and the change in market value is recorded as an
unrealized gain or loss. Gain or loss on the
purchase or sale of contracts having the same
settlement date, amount and counterparty is
realized on the date of offset, otherwise gain
or loss is realized on settlement date.
The Fund may invest in non-U.S. dollar
denominated instruments subject to limitations,
and enter into forward foreign currency exchange
contracts to facilitate transactions in foreign
securities and protect against a possible loss
resulting from an adverse change in the
relationship between the U.S. dollar and such
foreign currency. Risks may arise upon entering
into these contracts from the potential
inability of counterparties to meet the terms of
their contracts and from unanticipated movements
in the value of a foreign currency relative to
the U.S. dollar.
Open forward foreign currency contracts for
International Equity at June 30, 1997 were as
follows:
Settlement Current
Unrealized Date
Value Gains
Sell Contracts
DEM 10,967,592 07/31/97
$6,303,141
$93,821
DEM 4,630,654 07/31/97
2,663,887
74,978
Total Sell Contracts
(Receivable Amount $9,135,827)
$8,967,028 $168,799
DEM-German Deutschemark
(6) Contingency
Two lawsuits seeking class action status have
been filed against Managers Intermediate
Mortgage Fund, Managers Short Government Fund,
the Investment Manager and the Trust, among
other defendants. In both of these cases, the
plaintiffs seek unspecified damages based upon
losses alleged in the two funds named above. In
the suit relating to Managers Short Government
Fund, the court has preliminarily approved the
parties' agreement to settle all claims by the
purported class. However, the settlement is
subject to certain conditions such as a pre-
determined percentage of class members
participating in the settlement and final court
approval. For these and other reasons, there
can be no assurance that the settlement will be
consummated. In addition, a non-class action
lawsuit based on similar allegations has been
filed by a customer against certain of the
defendants named in the class action lawsuits,
as well as Managers Short and Intermediate Bond
Fund. Certain other customers, who are
potentially members of the plaintiff class in
each of the two class action lawsuits referred
to above, have asserted that they may file
similar lawsuits based on similar claims, but
have not done so. Management continues to
believe that it has meritorious defenses and, if
the cases are not settled, Management intends to
defend vigorously against these actions.
Where Leading Money Managers Converge
Fund Distributor
The Managers Funds, L.P.
40 Richards Avenue
Norwalk, Connecticut 06854-2325
(203)857-5321 or (800)835-
3879
Custodian
State Street Bank and Trust
Company
1776 Heritage Drive
North Quincy, Massachusetts
02171
Legal Counsel
Shereff, Friedman, Hoffman &
Goodman, LLP 919 Third Avenue
New York, New York 10022
Transfer Agent
Boston Financial Data
Services, Inc. attn: The
Managers Funds
P.O. Box 8517
Boston, Massachusetts 02266-
8517 (800)252-0682
The Managers Funds
Equity Funds:
INCOME EQUITY FUND
Scudder, Stevens & Clark,
Inc.
Spare, Kaplan, Bischel &
Associates
CAPITAL APPRECIATION FUND
Essex Investment Management
Company, Inc.
Husic Capital Management
SPECIAL EQUITY FUND
Liberty Investment
Management
Pilgrim Baxter &
Associates
Westport Asset
Management, Inc.
INTERNATIONAL EQUITY
FUND
Scudder, Stevens &
Clark, Inc.
Lazard, Freres Asset
Management Co.
Income Funds:
MONEY MARKET FUND
J.P. Morgan
SHORT GOVERNMENT FUND
Jennison Associates
Capital Corp.
SHORT AND INTERMEDIATE
BOND FUND
Standish, Ayer &
Wood, Inc.
INTERMEDIATE MORTGAGE
FUND
Jennison Associates
Capital Corp.
BOND FUND.
Loomis, Sayles &
Company, Inc.
GLOBAL BOND FUND
Rogge Global Partners
This report is prepared for the information of
shareholders. It is authorized for distribution
to prospective investors only when preceded by
an effective prospectus.
