<PAGE>
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QUANTITATIVE GROUP of FUNDS
ANNUAL
REPORT
MARCH 31, 1998
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U.S. EQUITY FUNDS
Quantitative Small Cap Fund
Quantitative Mid Cap Fund
Quantitative Growth and Income Fund
INTERNATIONAL EQUITY FUNDS
Quantitative International Equity Fund
Quantitative Emerging Markets Fund
<PAGE>
[LETTERHEAD]
May 29, 1998
Dear Fellow Shareholder:
I am pleased to provide you with the Annual Report of the Quantitative Group
of Funds. The twelve month period from April of 1997 until the end of March
1998 has been a tremendous period for investors. As a group, your funds have
performed remarkably well. In a microcosm, the events of this past year under-
score the wisdom of long-term investing and the importance of diversification.
Many of the concerns that were facing investors at the beginning of 1997 dis-
sipated over the course of the next twelve months. In the domestic markets,
while larger companies continued to be the strongest performers, both smaller
and middle sized companies quickly rebounded from losses at the beginning of
1997, and rewarded investors for riding out the storm. Our large cap, mid cap,
and small cap domestic funds generated phenomenal returns of 51.52%, 46.76%,
and 37.79% over the twelve month period ended March 31, 1998.
The path to these returns was not a straight line. Although the Dow Indus-
trial Averages crossed the 9000 mark in April, 1998, its growth was severely
stalled in October, 1997, when troubles in Southeast Asia caused the largest
single day decline in the history of the Dow, and the market paused to assess
the impact of the growing financial crises on the fortunes of domestic compa-
nies. During this period, our own portfolio managers sat on the sidelines wait-
ing for the market, and analysts in particular, to develop informed opinions
about the impact of these events on individual companies.
In the end, those funds most affected by troubles in Southeast Asia were our
two international funds. Despite the difficulties in Southeast Asia, our inter-
national fund generated a strong return, as a result of its significant posi-
tions in larger, more mature foreign markets. Our emerging markets fund, howev-
er, held positions in Malaysia, South Korea, and Thailand, and experienced
losses for the twelve months as a result. Despite our disappointment with the
losses encountered by the Fund, we are pleased that our diversified strategy
within the emerging markets prevented the Fund from being affected to the same
extent as many other emerging markets funds. Moreover, we know from history
that the declines in a single market or region can be surmounted in a rela-
tively short period of time.
From an operational perspective, we have developed a new Web Site on the
Internet that is designed to give our investors greater access to information
about the Fund Group. On the site, you will find more current commentary about
each of our funds, recent articles and press releases, and current net asset
values and performance information. I hope that you will take a minute to visit
the site at WWW.QUANTFUNDS.COM and share your views with us. Another small im-
provement we recently made was to change the names of certain of our funds to
more accurately reflect their investment objectives.
<PAGE>
I am pleased to announce that we have just opened a new international fund,
Quantitative Foreign Value, managed by Bernard R. Horn, Jr. of Polaris Capital
Management, Inc. Mr. Horn has achieved considerable success and peer recogni-
tion in almost 20 years of experience in international investing. The fund will
focus on both developed and emerging foreign markets. Further information
can be obtained from the Fund's prospectus, available on our Web Site or by
calling us at 800-331-1244.
Finally, I want to share with you the perspectives of our portfolio managers
on the broader trends for the upcoming year:
Robert A. von Pentz, CFA (Quantitative Small Cap Fund, Quantitative Mid Cap
Fund): "While any signs of market weakness are likely to lead to periods favor-
ing the large, liquid stocks, the outlook for small cap stocks is positive. The
relative valuation of small caps is very good, particularly when one considers
the expected earnings growth."
"The outlook for mid cap stocks is very positive as well. The reduction in
the capital gains tax rate and the negative implications of the strong dollar
for larger multinational companies are beneficial to mid cap stocks."
Steve Esielonis and Charles Babin, CFA (Quantitative Growth and Income Fund):
"With the onset of the financial debacle in Indonesia and surrounding coun-
tries, investors have returned to large cap stocks, especially Blue Chip is-
sues, as a safe haven. We expect that this trend will continue throughout 1998
as some small- and mid-sized company earnings are more heavily impacted by
troubles in the Far East."
Norman H. Meltz and David Umstead, CFA (Quantitative International Equity
Fund and Quantitative Emerging Markets Fund): "Asian markets will most likely
be hindered by the continuing difficulties in Japan. European markets continue
to offer the most hope of the international markets for strong returns."
"Restructuring and the rebound in Asia, however, offer an opportunity which
occurs infrequently. Although interest in emerging markets has followed such
market run-ups as occurred from 1988 to 1993, the best long-term investment op-
portunity has occurred at times such as now, during a correction and restruc-
turing."
I appreciate the continued confidence that you have shown in us. We are
available at any time to answer questions and provide assistance.
Sincerely,
/s/ Willard L. Umphrey
Willard L. Umphrey
Chairman
Lyle H. Davis, who co-managed both our Quantitative International Equity Fund
and our Quantitative Emerging Markets Fund died suddenly in April. Lyle was re-
garded as one of the deans of the investment management community and a pioneer
in the application of quantitative techniques to select foreign stocks. He
served as President and CEO of Boston International Advisors, the firm he
founded in 1986, which recently became Independence International Associates.
All who knew Lyle greatly respected his professionalism and quiet demeanor. We
will miss the opportunity to share his wisdom and his friendship.
<PAGE>
QUANTITATIVE SMALL CAP FUND
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INVESTMENT PROFILE All Data as of March 31, 1998
- ---------------------
INVESTMENT COMMENTARY
- ---------------------
While investor interest in small caps waxed and waned over the past year
based primarily on factors other than the companies themselves, such as concern
over potential interest rate hikes and the Asian crisis, the Fund continued to
pursue its course of investing in small cap companies. This adversely affected
the Fund's performance during the periods when the largest stocks in the Russell
2000 substantially outperformed the smallest stocks. However, this enabled the
Fund to acquire stocks that were sound fundamentally at depressed prices and
reap the benefits when investors began again to value companies on the basis of
their merits rather than unfounded fears.
The Fund's performance for the period is attributable 63% to stock
selection and 37% to sector allocation. A number of the Fund's most profitable
stocks were in the consumer cyclical and financial sectors. The consumer stocks
included Furniture Brands (furniture manufacturer), Ross Stores (apparel
retailer) and ShowBiz Pizza Time (owners of the Chuck E. Cheese chain, among
others). These stocks benefited from a pent-up consumer demand for goods such as
clothing and furniture driven by the strong economy. The best performing
financial stocks included savings and loans Fremont General, Astoria Financial,
and Golden State Bancorp, along with Ocwen Financial (financial services). The
savings and loans had increased earnings from mortgage loans, due to a healthy
housing market.
In addition to the specific stocks, the Fund's overweights in the consumer
cyclical and financial sectors added to the Fund's performance. Underweighting
utilities and basic materials also added value. The Fund's long standing energy
overweight adversely affected returns during the third and fourth quarters of
the fiscal year.
The relative valuation of small caps is very positive, particularly when
one considers the expected earnings growth. While the S&P 500 is trading at a
forward multiple over two times expected earnings growth, the Russell 2000
trades at a multiple equal to its growth rate.
<TABLE>
<CAPTION>
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PERFORMANCE UPDATE 1Q98 One Year Five Years Since Inception
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Quantitative Small Cap 11.68% 36.41% 19.32% 24.23% (8/3/92)
Russell 2000 Index 10.06% 42.01% 19.11% 19.09%
Lipper Small Cap Funds Average 10.90% 43.54% 18.51%
</TABLE>
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VALUE OF $10,000 INVESTED IN QUANTITATIVE SMALL CAP ORDINARY SHARES VS.
RUSSELL 2000
- -----------------------------------------------------------------------
[LINE GRAPH APPEARS HERE]
QUANTATIVE SMALL CAP
- --------------------
Small Cap Russell 2000
--------- ------------
$10,000 $10,000
$10,220 $10,230
1993 $12,870 $11,760
$14,120 $12,260
$14,850 $12,530
$16,790 $13,620
1994 $16,590 $13,980
$16,630 $13,610
$15,300 $13,080
$17,210 $13,990
1995 $17,300 $13,720
$18,330 $14,360
$19,860 $15,700
$23,413 $17,253
1996 $23,118 $17,627
$24,614 $18,533
$26,935 $19,460
$28,592 $19,526
1997 $28,800 $20,541
$25,039 $19,479
$29,497 $21,996
$33,576 $25,269
1998 $30,872 $24,422
$34,133 $26,879
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FUND INFORMATION
- ----------------
Ticker Symbol USBNX (ordinary)
QBNAX (institutional)
Number of Companies 72
Median Market Cap $737 million
Price to Book 3.6
Price to Earnings 23.1
Assets Under Management $73 million
* The Russell 2000 Index is an unmanaged index comprised of the bottom
two-thirds of the largest 3,000 publicly traded companies in the United States.
It is widely recognized as representative of the general market for small
company stocks. Investment returns assume the reinvestment of dividends paid on
stocks comprising the Index. The Lipper returns are based on the Lipper Small
Cap Funds Average, as published in the Wall Street Journal. Lipper Mutual Funds
Averages are comprised of all of the mutual funds within their respective
investment objectives, excluding multiple share classes, and adjusted for the
reinvestment of capital gains distributions.
Past performance is no guarantee of future results. This information may be used
only when preceded or accompanied by a prospectus. Returns reflect the average
annual returns of ordinary shares of the Fund, which carry a 12b-1 fee of .50bp,
and include the effect of a 1% deferred sales charge. Excluding the effect of
the 1% redemption fee for ordinary shares, the returns would have been 37.79%,
19.56%, and 24.45%, for the one year, five year, and inception periods,
respectively. The value of $10,000 chart reflects the effects of the redemption
fee. Institutional shares of the Fund are available to clients of some financial
advisors without a 12b-1 fee or sales charge. The one year, five year and since
inception (1/6/93) returns for Institutional Shares are 38.44%, 20.17% and
21.35% respectively. Share prices will vary and shares may be worth more or less
than their original cost at the time of sale. The investment return and
principal value of an investment will fluctuate. The Fund's portfolio is subject
to change. Distributed by U.S. Boston Capital Corporation.
<PAGE>
QUANTITATIVE SMALL CAP FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 1998
[PICTURE OF ROBERT
VON PENTZ APPEARS HERE]
Robert von Pentz
THE QUANTITATIVE SMALL CAP FUND (formerly Quantitative Numeric Fund) is a small
company fund that seeks investment opportunities among companies with less than
one billion dollars in market capitalization. The Fund looks for stocks of
companies that have superior growth rates, but with share prices that do not
fully reflect their potential. Stocks of smaller companies generally are more
volatile than larger companies, but also offer the opportunity for greater price
appreciation. The Quantitative Small Cap Fund may not be appropriate for every
investor.
INVESTMENT PROCESS The Fund employs a disciplined, quantitative approach to
investing. Each and every stock in the universe of eligible investments is
examined through a variety of prisms created by a computer model. Rankings are
assigned to the stocks based on their attractiveness. Generally, companies with
records of strong earnings growth, whose earnings estimates are being revised
upwards by securities analysts, and which are valued cheaply on a relative
basis, are good candidates for inclusion in the Fund's portfolio. Risk controls
also are employed to prevent the Fund from concentrating its investments in any
particular industry sector.
BUY AND SELL DISCIPLINE The purchase and sale of securities in the Fund's
portfolio primarily is driven by computer rankings. Among comparably ranked
companies, a further examination may be conducted to determine if there are
additional quantitative factors that might bear upon future performance. A
strict, passionless sell discipline is employed if a company's rankings
deteriorate or its market capitalization increases above one-and-a-half billion
dollars.
MANAGEMENT The Fund is managed by Robert von Pentz, CFA, an owner and chief
equity investment officer of Columbia Partners, LLC located in Washington, D.C.
Bob has spent most of his career designing and implementing quantitative
strategies. He earned his BA in economics and an MBA from the University of New
Mexico. His interests include aviation, flyfishing and gardening.
- ------------------
TOP TEN HOLDINGS (Each generally no more than 2-3% of the Fund.)
- ------------------
Avis Rent A Car, Inc. Mail-Well, Inc.
Consolidated Graphics, Inc. Michaels Stores, Inc.
Fremont General Corp. Orthodontic Centers of America
Henry (Jack) & Associates Ross Stores, Inc.
Lightbridge, Inc. Superior Services, Inc.
- -----------------
SECTOR ALLOCATION
- -----------------
[PIE CHART APPEARS HERE]
- ------------------------------------
Energy 6%
- ------------------------------------
Consumer Cyclical 16%
- ------------------------------------
Capital Goods 8%
- ------------------------------------
Health Care 17%
- ------------------------------------
Basic Materials 2%
- ------------------------------------
Cash 1%
- ------------------------------------
Technology 11%
- ------------------------------------
Utilities 8%
- ------------------------------------
Financials 18%
- ------------------------------------
Consumer Services 7%
- ------------------------------------
Consumer Staples 6%
- ------------------------------------
<PAGE>
QUANTITATIVE MID CAP FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 1998
- ---------------------
INVESTMENT COMMENTARY
- ---------------------
During a twelve month period in which investors allowed outside factors,
such as concerns over interest rates and the Asian economic crisis, to distract
them from a company's fundamentals, the Fund continued to remain fully invested
in mid cap stocks. When the market was depressed, the Fund's investment model
targeted smaller mid cap stocks, which still retained attractive valuations and
had higher earnings growth expectations than those for larger stocks. When the
market refocused on the positive attributes of the smaller mid cap stocks, the
Fund's model again added value.
Stock selection and sector allocation had an equal impact on performance.
The Fund focused on extremely attractive valuations and continued positive
earnings trends in the technology, financials, and energy sectors. These sectors
had suffered the most during the sell-off, despite numerous companies with
attractive growth rates. Some of the Fund's best-performing holdings were
financial stocks Ahmanson, Dime Bancorp and Old Republic, all savings and loans
which saw increased mortgage loan business from an improved housing market, and
consumer cyclical stocks Costco (retail warehouse), Ross Stores (apparel
retailer), and TJX (discount apparel retailer, including Marshalls and TJ Maxx
chains). Costco and TJX in particular benefited from well-executed expansion
plans increasing revenues for the period.
The outlook for mid cap stocks is very positive. While all asset classes
experienced negative estimate revisions during the third fiscal quarter, mid
caps fared the best, with the lowest percentage of downside revisions. When
fiscal fourth quarter earnings are reported, mid caps are expected to deliver
the strongest growth. The relative valuation of the asset class is attractive,
trading at a discount price/earnings multiple to large stocks despite expected
earnings growth over 10% greater than the S&P 500. The reduction in the capital
gains tax rate and the negative implications of the strong dollar for larger
multinational companies are also beneficial to mid cap stocks.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
PERFORMANCE UPDATE 1Q98 One Year Since Inception
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Quantitative Mid Cap 11.91% 46.76% 32.02% (3/21/95)
S&P 400 Index 11.02% 49.03% 28.67%
Lipper Mid Cap Funds Average 12.05% 43.06%
</TABLE>
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VALUE OF $10,000 INVESTED IN QUANTITATIVE MID CAP ORDINARY SHARES VS. S&P 400
- -----------------------------------------------------------------------------
[LINE GRAPH APPEARS HERE]
QUANTITATIVE MID CAP
- --------------------
Mid Cap S&P 400
------- -------
1995 $10,000 $10,000
$10,120 $10,132
$11,120 $11,016
$12,270 $12,091
1996 $12,665 $12,262
$13,460 $13,018
$14,204 $13,393
$14,826 $13,783
1997 $16,141 $14,618
$15,812 $14,400
$18,201 $16,517
$21,671 $19,173
1998 $20,762 $19,332
$23,234 $21,462
- ----------------
FUND INFORMATION
- ----------------
Ticker Symbol QNIIX (ordinary)
QNIAX (Institutional)
Number of Companies 51
Median Market Cap $3.3 billion
Price to Book 4.3
Price to Earnings 21.3
Assets Under Management $16 million
The S&P 400 Index is an unmanaged index comprised of stocks outside the large
capitalization bias of the S&P 500, which are chosen by Standard & Poors for
their size and industry characteristics. It is widely recognized as
representative of the general market for stocks with medium capitalizations.
Investment returns assume the reinvestment of dividends paid on stocks
comprising the Index. The Lipper results are based on the Lipper Mid Cap Funds
Average, comprised of mutual funds with medium cap investment objectives,
determined by Lipper and as published in the Wall Street Journal. Lipper Mutual
Funds Averages are comprised of all of the mutual funds within their respective
investment objectives, excluding multiple share classes, and are adjusted for
the reinvestment of capital gains distributions.
Past performance is no guarantee of future results. This information may be used
only when preceded or accompanied by a prospectus. Returns reflect the average
annual returns of ordinary shares of the Fund, which carry a 12b-1 fee of .25bp.
Institutional Shares of the Fund may be available to clients of some financial
advisors without a 12b-1 fee. The one year and since inception (4/17/95) returns
for Institutional Shares are 47.01% and 31.86% respectively. Share prices will
vary and shares may be worth more or less than their original cost at the time
of sale. The investment return and principal value of an investment will
fluctuate. The Fund's portfolio is subject to change. Distributed by U.S. Boston
Capital Corporation.
<PAGE>
QUANTITATIVE MID CAP FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 1998
[PICTURE OF ROBERT
VON PENTZ APPEARS HERE]
Robert von Pentz
THE QUANTITATIVE MID CAP FUND (formerly Quantitative Numeric II) seeks
investment opportunities among companies with from one to five billion dollars
in market capitalization. The Fund looks for stocks of companies that have
superior growth rates, but with share prices that do not fully reflect their
potential. Companies in this strong middle range of market capitalization often
have more solid industry positions and experienced management than smaller
companies. At the same time, they frequently are in the earlier stages of their
business cycle and can produce higher sales and earnings growth rates than
larger, more established companies.
INVESTMENT PROCESS The Fund employs a disciplined, quantitative approach to
investing. Each and every stock in the universe of eligible investments is
examined through a variety of prisms created by a computer model. Rankings are
assigned to the stocks based on their attractiveness. Generally, companies with
records of strong earnings growth, whose earnings estimates are being revised
upwards by securities analysts, and which are valued cheaply on a relative
basis, are good candidates for inclusion in the Fund's portfolio. Risk controls
also are employed to prevent the Fund from concentrating its investments in any
particular industry sector.
BUY AND SELL DISCIPLINE The purchase and sale of securities in the Fund's
portfolio primarily is driven by computer rankings. Among comparably ranked
companies, a further examination may be conducted to determine if there are
additional quantitative factors that might bear upon future performance. A
strict, passionless sell discipline is employed when a company's rankings
deteriorate or its market capitalization increases above five billion dollars.
MANAGEMENT The Fund is managed by Robert von Pentz, CFA, an owner and chief
equity investment officer of Columbia Partners, LLC located in Washington, D.C.
Bob has spent most of his career designing and implementing quantitative
strategies. He earned his BA in economics and an MBA from the University of New
Mexico. His interests include aviation, flyfishing and gardening.
- ------------------
TOP TEN HOLDINGS (Each generally no more than 2-3% of the Fund.)
- ------------------
Ace Limited LCI International Inc.
Allied Waste Inds., Inc. Miller (Herman), Inc.
Capital One Finl. Corp. Montana Power Co.
Compuware Corp. OfficeMax, Inc.
Dime Bancorp, Inc. Quorum Health Group, Inc.
- -----------------
SECTOR ALLOCATION
- -----------------
- ------------------------------------
Basic Materials 3%
- ------------------------------------
Health Care 8%
- ------------------------------------
Consumer Cyclicals 19%
- ------------------------------------
Financials 18%
- ------------------------------------
Consumer Services 6%
- ------------------------------------
Capital Goods 6%
- ------------------------------------
Cash 3%
- ------------------------------------
Energy 7%
- ------------------------------------
Utilities 8%
- ------------------------------------
Technology 13%
- ------------------------------------
Consumer Staples 8%
- ------------------------------------
<PAGE>
QUANTITATIVE GROWTH & INCOME
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 1998
- --------------------------------------------------------------------------------
INVESTMENT COMMENTARY
- --------------------------------------------------------------------------------
The Fund's experience with one of the better performing sectors during the
period, technology, demonstrates the benefits of the quantitative method.
Despite a generally stellar year for technology stocks, the sector dropped
dramatically in the last three months of 1997 as investors worried about the
impact of the financial crisis in the Far East. We held our positions because
the impact on U.S. technology companies' earnings was at that point
unquantifiable. Many of those issues hardest hit have since moved higher and in
cases like Compuware, have eclipsed their previous highs. Another benefit to
shareholders of our holding on to the technology stocks was avoiding generating
more realized gains, which would have resulted in larger taxable distributions.
This was also factored into our decision making process.
Our sector selection model, introduced roughly a year and a half ago,
continues to add value to the Fund. Some of the sectors we anticipate will
perform well over the next six months are consumer finance, electronic
semiconductors, and long distance telecommunications.
Large cap stocks, as a whole, once again provided investors with higher
returns than their smaller cap relatives. We expect that investors will continue
to turn to large cap stocks, especially Blue Chip issues throughout 1998 as
small and mid sized company earnings are more heavily impacted by troubles in
the Far East.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
PERFORMANCE UPDATE 1Q98 One Year Five Years Ten Years Since Inception
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Quantitative Growth & Income 12.95% 50.01% 19.87% 17.75% 17.09% (5/9/85)
S&P 500 Index 13.95% 48.00% 22.40% 18.94% 18.56%
Lipper Growth & Income Funds Average 11.62% 40.15% 19.18% 16.37%
</TABLE>
- --------------------------------------------------------------------------------
VALUE OF $10,000 INVESTED IN QUANTITATIVE GROWTH AND INCOME ORDINARY SHARES
VS. S&P 500
- --------------------------------------------------------------------------------
[LINE GRAPH APPEARS HERE]
QUANTITATIVE GROWTH AND INCOME
- ------------------------------
OGI S&P 500
--- -------
$10,000 $10,000
$9,660 $10,490
1986 $11,190 $12,130
$12,820 $13,810
$13,430 $14,630
$13,010 $13,610
1987 $13,360 $14,370
$15,780 $17,440
$16,350 $18,320
$17,380 $19,520
1988 $13,560 $15,120
$14,920 $15,980
$15,690 $17,050
$15,540 $17,110
1989 $15,860 $17,630
$17,370 $18,880
$18,880 $20,540
$21,760 $22,740
1990 $21,760 $23,210
$20,990 $22,510
$22,570 $23,930
$19,660 $20,640
1991 $21,510 $22,490
$24,750 $25,760
$24,240 $25,700
$25,740 $27,050
1992 $27,530 $29,310
$27,160 $28,580
$26,860 $29,120
$27,640 $30,040
1993 $29,270 $31,540
$30,900 $32,920
$31,220 $33,080
$32,260 $33,930
1994 $32,750 $34,780
$31,370 $33,400
$31,210 $33,540
$32,470 $35,180
1995 $32,534 $35,180
$35,370 $38,600
$38,178 $42,290
$40,809 $45,650
1996 $41,692 $48,398
$43,211 $50,997
$44,961 $53,287
$45,910 $54,934
1997 $50,037 $59,510
$50,973 $60,706
$60,821 $71,311
$69,864 $76,645
1998 $68,384 $78,846
$76,467 $89,845
- --------------------------------------------------------------------------------
FUND INFORMATION
- --------------------------------------------------------------------------------
Ticker Symbol USBOX (ordinary)
QGIAX (institutional)
Number of Companies 103
Average Market Cap $41.8 billion
Price to Book 4.2
Price to Earnings 19.0
Assets Under Management $70 million
The S&P 500 Index is an unmanaged index of stocks chosen by Standard & Poors for
their size and industry characteristics. It is widely recognized as
representative of the general market for stocks in the United States. Investment
returns assume the reinvestment of dividends paid on stocks comprising the
Index. The Lipper results are based on the Growth & Income Funds Average,
comprised of mutual funds with similar objectives, determined by Lipper and as
published in the Wall Street Journal. Lipper Mutual Funds Averages are comprised
of all of the mutual funds within their respective investment objectives,
excluding multiple share classes, and are adjusted for the reinvestment of
capital gains distributions.
Past performance is no guarantee of future results. This information may be used
only when preceded or accompanied by a prospectus. Returns reflect the average
annual returns of ordinary shares of the Fund, which carry a 12b-1 fee of
.50bp., and include the effects of a 1% deferred sales charge. Excluding the
effects of the 1% redemption fee for ordinary shares, the returns would have
been 51.52%, 20.11%, 17.87% and 17.18%, for the one year, five year, ten year
and inception periods, respectively. The value of $10,000 chart reflects the
effects of the redemption fee. Institutional Shares of the Fund may be available
to clients of some financial advisors without a 12b-1 fee or sales charge. The
one year, five year and since inception (3/25/91) returns for Institutional
Shares are 52.18%, 20.70% and 18.41% respectively. Share prices will vary and
shares may be worth more or less than their original cost at the time of sale.
The investment return and principal value of an investment will fluctuate. The
Fund's portfolio is subject to change. Distributed by U.S. Boston Capital
Corporation.
<PAGE>
QUANTITATIVE GROWTH & INCOME
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 1998
THE QUANTITATIVE GROWTH & INCOME FUND, created in 1985, seeks long-term growth
of capital by investing primarily in the common stock of larger, more stable
companies. The Fund is designed to be a core United States common stock
portfolio that can be utilized either alone or in conjunction with more narrowly
differentiated strategies. The Quantitative Growth & Income Fund employs a
conservative equity investment strategy that makes it well suited for longer
term investors seeking a domestic stock fund for retirement or college planning.
INVESTMENT PROCESS The Fund's investment process begins with a top-down ranking
of industries based on forecasts of their relative attractiveness. Strict limits
are placed on the concentration of securities that may be purchased within any
economic and industry sector to avoid undue risk. In addition, risk controls
restrict the percentage of the Fund's assets that can be invested in the stock
of a particular company.
BUY AND SELL DISCIPLINE Individual investments are selected from among a
universe of over 1,000 companies. Stocks within the portfolio are chosen based
on rankings produced by a multifactor quantitative model. Revisions to a
company's earnings estimates, which are published by financial analysts, are
closely followed and trends are quantified daily to arrive at a forecast of the
actual earnings of the company for the quarter. Each company's stock is then
evaluated on the basis of historic earnings, dividends, and asset values, which
are compared to the current price of the stock. Based on these and other
factors, a company's stock is assigned a "matrix" ranking which determines
whether it will be purchased for the Fund or retained in its portfolio.
MANAGEMENT The Quantitative Growth & Income Fund has been managed continuously
since inception by a team of analysts and portfolio managers at State Street
Global Advisors located in Boston, Massachusetts. The team at State Street
responsible for the day-to-day management of the portfolio includes Steven M.
Esielonis and Charles Babin, CFA.
- --------------------------------------------------------------------------------
TOP TEN HOLDINGS
- --------------------------------------------------------------------------------
(Each generally no more than 2-3% of the Fund.)
AT & T Exxon
Compaq Computer Ford Motor
Compuware General Electric
Dayton Hudson Merck
Dell Computer Schering-Plough
- --------------------------------------------------------------------------------
SECTOR ALLOCATION
- --------------------------------------------------------------------------------
[PIE CHART APPEARS HERE]
Consumer Staples 7%
Transportation 1%
Utilities 2%
Financials 16%
Consumer Cyclicals 14%
Health Care 9%
Capital Goods 6%
Communication Services 7%
Basic Materials 6%
Energy 7%
Technology 24%
<PAGE>
QUANTITATIVE INTERNATIONAL EQUITY
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 1998
- --------------------------------------------------------------------------------
INVESTMENT COMMENTARY
- --------------------------------------------------------------------------------
Foreign market returns over the past year have varied dramatically. In
Europe, every one of the developed country equity markets delivered positive
returns, and all but one of those exceeded 20%. Italy, Spain, and Switzerland
with 83%, 76% and 52% returns, respectively, all performed exceptionally. In all
three of these countries improving economies and the anticipation of the
benefits from the European common currency contributed to the increase in stock
prices. In contrast to the buoyant European markets, the Pacific equity markets
all declined with the exception of Australia, which was flat. The problems in
the Pacific region started last summer with the precipitous fall of the Thai
bhat and spilled over into the other southeast Asia currencies and equity
markets. As is often the case, investor reaction was extreme. In spite of the
turmoil in the Pacific region the Fund returned 14.9% for the quarter due to its
broad diversification across European and Latin American countries -- more than
offsetting the declines in the Pacific.
While the stocks held by the Fund added 1.7% of return versus EAFE, country
allocation caused the Fund to under-perform EAFE. The Fund's investments in the
emerging markets, which are intended to provide additional diversification, were
the major cause of the under-performance. In February 1998, we also implemented
our country ranking models for the developed markets which also combine the same
two elements we use to select individual stocks, attractive valuations and
improving fundamentals. Foreign currency exposure cost the Fund about 3% in
return over the past year.
Most investment analysts predict slower economic growth over the next year.
Asian markets will most likely be hindered by the continuing difficulties in
Japan. European markets continue to offer the most hope of the international
markets for strong returns. However, even if the returns settle at more modest
levels, we believe that developed markets continue to offer an important
opportunity to diversify an investment portfolio.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
PERFORMANCE UPDATE 1Q98 One Year Five Years Ten Years Since Inception
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Quantitative International Equity 14.88% 11.82% 9.78% 5.30% 4.35% (7/31/87)
MSCI EAFE Index 14.73% 18.63% 11.93% 6.20% 7.37%
Lipper International Funds Average 14.67% 19.45% 13.45% 10.46%
</TABLE>
- --------------------------------------------------------------------------------
VALUE OF $10,000 INVESTED IN QUANTITATIVE INTERNATIONAL EQUITY ("QIE")
ORDINARY SHARES VS. EAFE
- --------------------------------------------------------------------------------
[LINE GRAPH APPEARS HERE]
Date EAFE Int. Equity
- ---- ---- -----------
10,000 10,000
9,840 9,750
1988 8,800 8,680
10,140 9,390
9,700 9,700
9,760 9,890
1989 11,290 11,200
11,320 11,070
10,620 10,970
11,940 12,780
1990 12,480 13,130
10,010 12,120
10,970 12,690
8,640 9,630
1991 9,560 9,420
10,270 10,090
9,710 9,540
10,540 10,230
1992 10,710 10,370
9,440 9,710
9,640 9,950
9,790 9,250
1993 9,410 8,950
10,540 9,880
11,600 10,500
12,370 11,440
1994 12,480 11,850
12,910 12,709
13,570 13,333
13,584 13,333
1995 13,446 12,920
13,696 12,718
13,797 12,984
14,376 12,959
1996 14,960 13,226
15,392 13,426
15,636 13,665
15,617 13,527
1997 15,879 13,927
15,635 14,080
18,140 15,405
18,015 15,791
1998 18,608 13,844
21,349 15,745
- --------------------------------------------------------------------------------
FUND INFORMATION
- --------------------------------------------------------------------------------
Ticker Symbol USBFX (ordinary)
QIEAX (institutional)
Number of Companies 118
Median Market Cap $12.6 billion
Price to Book 2.56
Price to Earnings 17.4
Assets Under Management $34 million
The Morgan Stanley Capital International Europe, Australia, and Far East
("EAFE") Index is an unmanaged index comprised of stocks in countries other than
the United States. It is widely recognized as representative of the general
market for developed foreign markets. The Lipper results are based on the
International Funds Average, comprised of mutual funds with similar objectives,
determined by Lipper and as published in the Wall Street Journal. Lipper Mutual
Funds Averages are comprised of all of the mutual funds within their respective
investment objectives, excluding multiple share classes, and are adjusted for
the reinvestment of capital gains distributions.
Past performance is no guarantee of future results.This information may be used
only when preceded or accompanied by a prospectus. Returns reflect the average
annual returns of ordinary shares of the Fund, which carry a 12b-1 fee of .50bp,
and include the effects of a 1% deferred sales charge. Excluding the effects of
the 1% redemption fee for ordinary shares, the returns would have been -12.95%,
10.00%, 5.41%, and 4.44%, for the one year, five year, ten year, and inception
periods, respectively. The Value of $10,000 chart reflects the effects of the
redemption fee. Institutional shares may be available to clients of some
financial advisors without a 12b-1 fee or sales charge. The one year and since
inception (8/25/94) returns for Institutional Shares are 13.50% and 4.80%
respectively. Share prices will vary and shares may be worth more or less than
their original cost at the time of sale. The investment return and principal
value of an investment will fluctuate. The Fund's portfolio is subject to
change. Distributed by U.S. Boston Capital Corporation.
<PAGE>
QUANTITATIVE INTERNATIONAL EQUITY
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 1998
THE QUANTITATIVE INTERNATIONAL EQUITY FUND, created in 1987, provides investors
with the opportunity to participate in the growth potential of companies located
in developed foreign countries. By investing in ten or more developed foreign
countries, the Fund attempts to take advantage of broad international economic
trends. Importantly, while the Fund's performance is affected by global and
international trends, its returns historically have not been highly correlated
to those of the United States' stock markets. Thus, adding the Fund to your
portfolio may provide diversification that can reduce your overall risk.
However, there are some special risks associated with foreign investing (e.g.
currency-exchange fluctuation). Thus, the Fund is designed as a long-term
investment and may not be suitable for each investor.
INVESTMENT PROCESS The Fund generally owns stocks of over 100 non-U.S. companies
located in the twenty-one countries comprising the Morgan Stanley Europe,
Australia and Far East (EAFE) Index. In addition, the Fund also may invest a
portion of its assets in emerging markets, such as Argentina and Turkey. This
diversification within the Fund, coupled with risk controls that limit the
amount of assets that can be invested in certain countries, like Japan, reduce
the effect that the performance of any single foreign country can have on the
Fund's return.
BUY AND SELL DISCIPLINE The investment process for the Quantitative
International Equity Fund relies upon sophisticated quantitative computer
models. The Fund utilizes proprietary investment models developed for each
individual country. Generally, the Fund searches for stocks with strong value
characteristics (e.g., low price relative to book value or earnings), with the
expectation that they will outperform growth stocks (e.g., high earnings growth
rates) in most markets. In some countries, however, the Fund's models may
emphasize growth characteristics, if these factors have been the predominate
predictor of share appreciation in that market over time. Individual portfolio
positions are examined regularly and country allocations may be adjusted to
reflect current forecasts for the market or imbalances resulting from
performance.
MANAGEMENT Since its inception, the Quantitative International Equity Fund has
been managed by Independence International Associates, Inc. (and its
predecessor), a Boston, Massachusetts-based money manager that specializes in
the management of international equity portfolios. The portfolio managers for
the Fund are Norman H. Meltz, and David A. Umstead, Ph.D., CFA.
- --------------------------------------------------------------------------------
TOP TEN HOLDINGS
- --------------------------------------------------------------------------------
(Each generally no more than 2-3% of the Fund.)
Anglian Water Nokia
CRH Schweizerische-Bankgesellschaf
Elf Aquitaine Skandia-Forsakring
Kerry Group UPM-Kymmene
KLM Wharf Holdings
- --------------------------------------------------------------------------------
COUNTRY ALLOCATION
*Australia, Austria, Belgium, Denmark, Germany, Italy, Norway, Singapore,
Spain, Sweden.
- --------------------------------------------------------------------------------
[PIE CHART APPEARS HERE]
Cash 2%
France 6%
Hong Kong 5%
Netherlands 6%
Emerging Markets 15%
Others* (3% or less) 17%
United Kingdom 10%
Japan 13%
Ireland 7%
Finland 7%
Malaysia 4%
Switzerland 8%
<PAGE>
QUANTITATIVE EMERGING MARKETS FUND
- ----------------------------------
INVESTMENT PROFILE All Data as of March 31, 1998
- ---------------------
INVESTMENT COMMENTARY
- ---------------------
The most significant factors impacting returns in emerging markets were the
crisis in Asia and the ability of European and Latin American emerging markets
to withstand the effects of that crisis. In the last six months of 1997, Asian
markets lost half their value, reflecting concern for currency values and debt
levels. As rescue plans were negotiated, Korea, Thailand, Malaysia and the
Philippines rebounded partially in the first quarter of 1998. India and Taiwan
managed to hold near to their early 1997 values.
In stark contrast, Latin America continued on a path of lower inflation and
far lower debt levels than in Asia, and positive equity returns, despite some
volatility and interest rate blips. This continuing recovery from the currency
crisis of 1994 offset the performance of Asian markets, and lends support to
expectations of restructuring in Asia. Emerging markets in Europe and the Middle
East were little affected by the crisis and posted moderate gains.
The Fund held a representative basket of stocks in 19 markets during this
fiscal year, and thus achieved a return similar to the IFCI index. Since the
basket tracked the index within each country, the country returns were more
significant factors than individual stock returns. The Fund's overall return is
remarkable for the counterbalance provided by the Latin American and European
markets given the extent to which Asian markets fell and rebounded.
The Fund is now incorporating a stock selection strategy based upon
research completed during the past year. The strategy involves selecting stocks
having higher value relative to forecast earnings, growth, and asset values
within each market. This strategy is similar to those used with success in
developed markets, but subject to the availability of forecasts within emerging
markets.
The volatility of the past year is not unexpected in emerging markets, but
rather is a trade-off for the higher growth potential. Expected growth of
earnings from analyst forecasts is 24% for emerging markets over the next fiscal
year, compared to 15% for the U.S., and 13% for other developed markets.
Note: we have changed our benchmark to the Morgan Stanley EMG Free Index, an
emerging markets index that provides a better comparison to the Fund.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
PERFORMANCE UPDATE 1Q98 One Year Since Inception
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Quantitative Emerging Markets 0.39% -17.50% -6.60% (10/3/94)
MS EMG Index 6.13% -13.67% -6.13%
Lipper Emerging Mkts Funds Average 4.96% -6.26%
- ------------------------------------------------------------------------------------------------------------------------------
VALUE OF $10,000 INVESTED IN QUANTITATIVE EMERGING MARKETS ORDINARY SHARES VS. IFCI AND MS EMG
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
[LINE GRAPH APPEARS HERE]
Date Emerging Mkt. IFCI MSEMG
- ---- ------------- ---- -----
$10,000 $10,000 $10,000
$ 8,213 $ 8,299 $ 8,558
1995 $ 7,469 $ 7,091 $ 7,496
$ 8,222 $ 7,708 $ 8,267
$ 8,047 $ 7,675 $ 8,210
1996 $ 8,026 $ 7,605 $ 8,095
$ 8,656 $ 8,185 $ 8,595
$ 9,059 $ 8,740 $ 8,946
$ 8,759 $ 8,548 $ 8,616
1997 $ 8,728 $ 8,526 $ 8,563
$ 9,544 $ 9,338 $ 9,283
$10,196 $ 9,901 $10,067
$ 9,558 $ 9,010 $ 9,159
1998 $ 7,924 $ 7,267 $ 7,551
$ 7,875 $ 7,726 $ 8,014
- ----------------
FUND INFORMATION
- ----------------
Ticker Symbol QFFOX (ordinary)
QEMAX (institutional)
Number of Companies 139
Assets Under Management $10.0 million
The IFCI Index is published by the International Finance Corporation, a member
of the World Bank. The Morgan Stanley EMG Index is published by Morgan Stanley.
Both are widely recognized as representatives of the general market for emerging
markets. The Lipper results are based on the Lipper Emerging Markets Funds
Average, comprised of mutual funds with similar objectives, determined by Lipper
and as published in the Wall Street Journal. Lipper Mutual Funds Averages are
equally weighted, comprised of all of the mutual funds within their respective
investment objectives, excluding multiple share classes, and are adjusted for
the reinvestment of capital gains distributions.
Past performance is no guarantee of future results. This information may be used
only when preceded or accompanied by a prospectus. Returns reflect the average
annual returns of ordinary shares of the Fund, which carry a 12b-1 fee of .50bp,
and include the effects of a 1% deferred sales charge. Excluding the effect of
the 1% redemption fee for ordinary shares, the returns would have been -16.67%
and -6.33%, for the one year and inception periods, respectively. The value of
$10,000 chart reflects the effects of the redemption fee. Institutional shares
may be available to clients of some financial advisors without a 12b-1 fee or
sales charge. The one year and since inception (4/2/96) returns for
Institutional Shares are -16.29% and -4.25% respectively. Share prices will vary
and shares may be worth more or less than their original cost at the time of
sale. The investment return and principal value of an investment will fluctuate.
The Fund's portfolio is subject to change. Distributed by U.S. Boston Capital
Corporation.
<PAGE>
QUANTITATIVE EMERGING MARKETS FUND
- ----------------------------------
INVESTMENT PROFILE All Data as of March 31, 1998
THE QUANTITATIVE EMERGING MARKETS FUND (formerly Quantitative Foreign Frontier
Fund) is designed to afford investors the opportunity to participate in the
overall growth potential of emerging market countries. Over twenty countries
located in Europe, Latin America, Africa, the Middle East, and Asia are
classified as emerging markets. Many of these countries experienced substantial
growth in per capita income and domestic production in the 1980s and 90s.
Moreover, continuing improvements in infrastructure are likely to make these
countries increasingly productive in years to come.
INVESTMENT PROCESS Rapid economic and political changes in emerging markets have
generated investment returns that are impressive over multi-year periods. Annual
returns for individual emerging markets, however, have been far more volatile
and unpredictable than those of the United States and other developed countries.
In fact, it is not uncommon for individual markets to gain significant amounts
one year and lose large sums the next. To minimize investors' exposure to the
annual performance volatility experienced by individual emerging markets, the
Fund invests at all times in eight or more countries.
BUY AND SELL DISCIPLINE At least two, and generally three, broad geographic
regions, such as Latin America, Asia, and Europe, will be represented in the
Fund's portfolio. Within a geographic region, investments are allocated equally
by the manager to selected emerging markets. Systematic rebalancing of portfolio
positions among countries assures that diversification will be maintained at
desired levels. The Fund has historically employed quantitative investment
models to select representative stocks within each country whose collective
performance are most likely to mirror the overall performance of that country's
stock market. The Fund has recently supplemented this approach with an
investment model designed to identify the most attractive stocks in each country
on the basis of value and improving fundamentals.
MANAGEMENT The Quantitative Emerging Markets Fund has been managed continuously
by Independence International Associates, Inc. (and its predecessor), a Boston,
Massachusetts-based money manager that specializes in the management of
international equity portfolios. The portfolio managers for the Emerging Markets
Fund are Norman H. Meltz, and David A. Umstead, Ph.D., CFA.
SPECIAL CONSIDERATIONS The Quantitative Emerging Markets Fund was created
specifically for long-term investors who are willing to accept greater risk,
including losses, in the pursuit of higher returns. Although the Fund offers
many investors an excellent opportunity to diversify their existing domestic and
international portfolios, it also may be more volatile than other funds and
presents special risks, like political uncertainty and currency exchange
fluctuation, and therefore may not be suitable for every investor.
- ----------------
TOP TEN HOLDINGS (Each generally no more than 2-3% of the Fund.)
- ----------------
BCOCom Portugues Telefonica de Argentina
BCOEspir Santo Telefonica del Peru
Hellenic Bottling Telefonos de Mexico
MSCI Taiwan Opal B Turkiye Is Bankasi
Portugal Telecom YPF Sociedad Anonima
- --------------------------------------------------------------------------------
COUNTRY ALLOCATION * China, Hungary, Philippines.
- --------------------------------------------------------------------------------
South Africa 5% Argentina 8%
Mexico 9% Brazil 8%
Other* (4% or less) 10% Malaysia 4%
[PIE GRAPH APPEARS HERE]
Chile 6% Cash 5%
India 5% Turkey 6%
Peru 6% Portugal 10%
Greece 9% Taiwan 9%
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE SMALL CAP FUND
- --------------------------------------------------------------------------------
COMMON STOCK--99.4%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
APPAREL & TEXILES--.8%
Tropical Sportswear International Corporation (a) 43,085 $ 608,576
-----------
AUTOMOBILES--1.9%
Avis Rent-A-Car Inc. (a) 42,560 1,380,540
-----------
BANKS--6.3%
Coast Federal Litigation Trust (a) 19,060 309,725
Golden State Bancorp Inc. (a) 30,655 1,170,638
Independence Community Bank Corporation (a) 31,840 569,140
PFF Bancorp Inc. (a) 45,120 930,600
Richmond County Financial Corporation 53,355 1,023,749
WestAmerica Bancorporation 15,540 518,647
-----------
4,522,499
-----------
BUILDING CONSTRUCTION--1.7%
McDermott (J. Ray) S.A. (a) 28,600 1,204,775
-----------
BUSINESS SERVICES--3.3%
American Capital Strategies Ltd. 43,710 967,084
Henry Jack & Associates Inc. 38,600 1,389,600
-----------
2,356,684
-----------
CHEMICALS--2.5%
Calgon Carbon Corporation 69,085 807,431
Mississippi Chemical Corporation 48,150 966,009
-----------
1,773,440
-----------
COMPUTERS & BUSINESS EQUIPMENT--1.2%
Xircom Inc. (a) 63,190 872,812
-----------
DRUGS & HEALTH CARE--15.2%
Coventry Corporation (a) 72,730 1,168,226
Curative Health Services Inc. (a) 35,855 1,194,420
Monarch Dental Corporation (a) 64,430 1,103,364
Orthodontic Centers of America Inc. (a) 60,280 1,307,322
Priority Healthcare Corporation (a) 41,980 750,392
PSS World Medical Inc. (a) 49,845 1,171,358
Quorum Health Group Inc. (a) 37,370 1,256,566
Steris Corporation (a) 21,325 1,151,550
Sunrise Assisted Living Inc. (a) 25,815 1,155,221
VISX Inc. (a) 28,520 713,000
-----------
10,971,419
-----------
ELECTRICAL EQUIPMENT--2.8%
AFC Cable Systems Inc. (a) 28,085 1,091,804
Watsco Inc. 34,615 930,278
-----------
2,022,082
-----------
ELECTRONICS--2.6%
ATMI Inc. (a) 29,605 895,551
Gentex Corporation (a)
(with rights exp. 8/26/01) 28,400 963,825
-----------
1,859,376
-----------
FINANCIAL SERVICES--1.0%
Ocwen Financial Corporation (a) 26,455 734,126
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
FOOD & BEVERAGES--5.6%
Earthgrains Company 22,970 $ 1,014,987
Flowers Industries Inc. 41,655 976,289
International Home Foods Inc. (a) 24,155 803,154
Ralcorp Holdings Inc. (a) 59,980 1,244,585
-----------
4,039,015
-----------
HOTELS & RESTAURANTS--1.6%
Showbiz Pizza Time Inc. (a) 33,475 1,115,136
-----------
HOUSEHOLD APPLIANCES & FURNISHINGS--1.7%
Furniture Brands International Inc. (a) 38,675 1,244,852
-----------
INSURANCE--8.0%
ESG Real Estate Ltd. 44,400 1,154,400
Fremont General Corporation 23,185 1,363,568
Mutual Risk Management Ltd. 28,190 954,936
NAC Real Estate Corporation 21,100 1,106,431
Reliance Group Holdings Inc. 61,570 1,177,526
-----------
5,756,861
-----------
LEISURE TIME--0.9%
Championship Auto Racing Team (a) 35,750 661,375
-----------
MISCELLANEOUS--1.5%
United Rentals Inc. (a) 42,515 1,105,390
-----------
OFFICE FURNISHINGS & SUPPLIES--1.5%
United Stationers Inc. (a) 17,575 1,086,355
-----------
PETROLEUM SERVICES--3.9%
Friede Goldman International Inc. 22,525 650,409
Pride International Inc. (a) 46,485 1,109,829
Veritas DGC Inc. (a) 20,970 1,060,296
-----------
2,820,534
-----------
POLLUTION CONTROL--3.9%
MPW Industrial Services Group Inc. (a) 50,035 544,131
Philip Services Corporation (a) 80,105 836,096
Superior Services Inc. (a) 45,695 1,425,113
-----------
2,805,340
-----------
PUBLISHING--3.8%
Consolidated Graphics Inc. (a) 24,705 1,429,802
Mail-Well Inc. (a) 34,555 1,308,771
-----------
2,738,573
-----------
REAL ESTATE--8.3%
Boston Properties Inc. 31,745 1,117,027
Capital Automotive Real Estate Investment Trust (a) 18,935 357,398
Entertainment Properties Trust 62,510 1,226,759
FelCor Suite Hotels Inc. 28,680 1,062,952
Imperial Credit Commercial Mortgage Investment Corporation 65,575 983,625
Kilroy Realty Corporation 42,470 1,213,049
-----------
5,960,810
-----------
</TABLE>
- --------------------------------------------------------------------------------
11
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE SMALL CAP FUND--CONTINUED
- -------------------------------------------------------------------------------
COMMON STOCK--Continued
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
RETAIL TRADE--6.6%
Dress Barn, The (a) 29,965 $ 861,494
Michaels Stores Inc. (a) 35,280 1,318,590
Ross Stores Inc. 30,709 1,355,035
Sunglass Hut International Inc. (a) 118,630 1,245,615
-----------
4,780,734
-----------
SAVINGS & LOAN--1.6%
Ahmanson (H.F.) & Company 0 22
Astoria Financial Corporation 18,680 1,154,658
-----------
1,154,680
-----------
SOFTWARE--4.1%
Arbor Software Corporation (a) 23,595 1,088,319
Rational Software Corporation (a) 71,275 926,575
Wind River Systems Inc. (a) 23,025 915,244
-----------
2,930,138
-----------
TELECOMMUNICATION SERVICES--1.9%
Lightbridge Inc. (a) 75,935 1,371,576
-----------
TELEPHONE--0.3%
Tel-Save Holdings Inc. (a) 10,000 227,500
-----------
TIRES & RUBBER--1.7%
Safeskin Corporation (a) 17,010 1,256,614
-----------
TRUCKING & FREIGHT FORWARDING--3.2%
CNF Transportation Inc. 14,965 537,805
Fritz Company Inc. (a) 43,870 696,436
Roadway Express Inc. 44,200 1,085,662
-----------
2,319,903
-----------
TOTAL COMMON STOCK
(Cost $59,414,856) $71,681,715
===========
</TABLE>
SHORT TERM INVESTMENTS--0.6%
<TABLE>
<CAPTION>
Par Value Value
<S> <C> <C>
State Street Repo 4.25%, 4/1/98, (Cost $402,000) (Dated
3/31/98), Collaterlized by $405,000 U.S. Treasury Bond
5.875%, 4/30/98, Market Value $414,988, Repurchase
Proceeds $402,047. $402,000 $ 402,000
------------
TOTAL SHORT TERM INVESTMENTS
(Cost $402,000) $ 402,000
------------
TOTAL INVESMENTS--100%
(Cost $59,816,856) (b) $ 72,083,715
============
</TABLE>
(a) Non-income producing security.
(b) At March 31, 1998, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $60,106,555 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $13,959,090
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (1,981,930)
-----------
Net unrealized appreciation $11,977,160
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
- -------------------------------------------------------------------------------
12
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE MID CAP FUND
- --------------------------------------------------------------------------------
COMMON STOCK--95.0%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
AEROSPACE--3.7%
Sundstrand Corporation 5,335 $ 322,767
Thiokol Corporation 6,320 305,335
-----------
628,102
-----------
ALUMINUM--1.4%
Reynolds Metals Company 3,815 234,384
-----------
APPAREL & TEXTILES--3.7%
Tommy Hilfiger Corporation (a) 5,210 312,926
Intimate Brands Inc. 11,345 307,024
-----------
619,950
-----------
AUTOMOBILES--1.8%
Lear Corporation (a) 5,365 302,452
-----------
BANKS--3.9%
Dime Bancorp Inc. 12,175 366,011
Golden State Bancorp Inc. (a) 7,500 286,406
-----------
652,417
-----------
BUSINESS SERVICES--1.8%
AccuStaff Inc. (a) 8,675 299,287
-----------
COMPUTERS & BUSINESS EQUIPMENT--3.6%
Ingram Micro Inc. (a) 8,660 321,502
Tandy Corporation 5,860 275,420
-----------
596,922
-----------
DRUGS & HEALTH CARE--9.5%
General Nutrition Companies Inc. (a) 8,305 330,124
McKesson Corporation 5,405 312,139
Quorum Health Group Inc. (a) 10,237 344,219
Total Renal Care Holdings Inc. (a) 8,741 291,185
Watson Pharmaceuticals Inc. (a) 8,775 315,900
-----------
1,593,567
-----------
ELECTRIC UTILITIES--2.1%
Montana Power Company 9,735 351,068
-----------
ELECTRONICS--3.4%
Advanced Fibre Communications (a) 8,540 310,642
National Semiconductor Corporation (a) 12,425 260,148
-----------
570,790
-----------
FINANCIAL SERVICES--3.8%
Capital One Financial Corporation 4,615 364,008
SLM Holding Corporation 6,145 268,076
-----------
632,084
-----------
FOOD & BEVERAGES--6.8%
Dean Foods Company 5,410 272,191
Dole Food Inc. 5,815 281,301
Flowers Industries Inc. 11,890 278,672
Interstate Bakeries Corporation 9,435 304,868
-----------
1,137,032
-----------
GAS & PIPELINE UTILITIES--1.7%
Washington Gas Light Company 10,160 278,130
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
INSURANCE--9.5%
Ace Limited 9,465 $ 356,712
Lincoln National Corporation 3,605 305,974
MGIC Investment Corporation 4,790 314,643
Ohio Casualty Corporation 6,390 306,720
Old Republic International Corporation 6,975 309,080
-----------
1,593,129
-----------
OFFICE FURNISHINGS & SUPPLIES--4.3%
Miller Herman Inc. 10,720 359,455
OfficeMax Inc. (a) 20,080 358,930
-----------
718,385
-----------
PAPER--1.5%
Union Camp Corporation 4,150 247,962
-----------
PETROLEUM SERVICES--7.3%
Ensco International Inc. 10,930 303,308
EVI Inc. 6,930 320,946
Global Marine Inc. (a) 13,320 329,670
R & B Falcon Corporation (a) 9,375 277,734
-----------
1,231,658
-----------
POLLUTION CONTROL--2.1%
Allied Waste Industries Inc. (a) 13,850 345,817
-----------
PUBLISHING--1.8%
Times Mirror Company 4,895 310,221
-----------
RETAIL TRADE--5.6%
Consolidated Stores Corporation (a) 7,590 325,896
Ross Stores Inc. 6,720 296,520
TJX Companies Inc. 7,100 321,275
-----------
943,691
-----------
SOFTWARE--5.9%
Compuware Corporation (a) 6,960 343,650
Intuit (a) 6,575 318,066
Sterling Commerce Inc. (a) 7,040 326,480
-----------
988,196
-----------
TELECOMMUNICATION SERVICES--3.8%
CIENA Corporation (a) 7,195 306,687
Valassis Communications Inc. (a) 7,930 325,130
-----------
631,817
-----------
TELEPHONE--4.0%
EXCEL Communications Inc. (a) 14,305 337,062
LCI International Inc. (a) 8,800 338,800
-----------
675,862
-----------
TRUCKING & FREIGHT FORWARDING--2.0%
CNF Transportation Inc. 9,205 330,805
-----------
TOTAL COMMON STOCK
(Cost $12,937,633) $15,913,728
===========
</TABLE>
- --------------------------------------------------------------------------------
13
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE MID CAP FUND--CONTINUED
- --------------------------------------------------------------------------------
SHORT TERM INVESTMENTS--5.0%
<TABLE>
<CAPTION>
Par Value Value
<S> <C> <C>
State Street Repo 4.25%, 4/1/98, (Cost $831,000) (Dated
3/31/98), Collateralized by $830,000 U.S. Treasury Bond
5.875%, 4/30/98, Market Value $850,469, Repurchase
Proceeds $831,098. $831,000 $ 831,000
-----------
TOTAL SHORT TERM INVESTMENTS
(Cost $831,000) $ 831,000
===========
TOTAL INVESTMENTS--100%
(Cost $13,768,633) (b) $16,744,728
===========
</TABLE>
(a) Non-income producing security.
(b) At March 31, 1998, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $13,771,669 were as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments in
which there is an excess of value over tax cost $3,136,691
Aggregate gross unrealized depreciation for all investments in
which there is an excess of tax cost over value (163,632)
----------
Net unrealized appreciation $2,973,059
==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
14
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE GROWTH AND INCOME FUND
- --------------------------------------------------------------------------------
COMMON STOCK--100.0%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
AEROSPACE--3.1%
General Dynamics Corporation 8,600 $ 740,675
Northrop Grumman Corporation 5,600 601,650
Sundstrand Corporation 13,200 798,600
-----------
2,140,925
-----------
APPAREL & TEXTILES--0.5%
V.F. Corporation 6,800 357,425
-----------
AUTO PARTS--1.3%
Dana Corporation 14,700 855,356
-----------
AUTOMOBILES--2.7%
Chrysler Corporation 9,100 378,219
Ford Motor Company 23,100 1,497,169
-----------
1,875,388
-----------
BANKS--7.9%
AmSouth Bancorporation 6,450 380,953
BankAmerica Corporation 13,800 1,140,225
Bankers Trust NY Corporation 7,500 902,344
Comerica Inc. 9,200 973,475
First Union Corporation 6,100 346,175
Mercantile Bankshares Corporation 16,150 584,428
National City Corporation 1,200 87,975
Republic NY Corporation 2,500 333,437
SouthTrust Corporation 16,200 678,375
-----------
5,427,387
-----------
BUSINESS SERVICES--1.3%
Cognizant Corporation 1,800 103,275
Comdisco Inc. 18,500 807,062
-----------
910,337
-----------
CHEMICALS--2.3%
Dow Chemical Company 3,400 330,650
Goodrich B.F. Company 14,000 714,875
Olin Corporation 11,000 516,312
-----------
1,561,837
-----------
COMPUTERS & BUSINESS EQUIPMENT--9.5%
Bay Networks Inc. (a) 16,300 442,138
Cisco Systems Inc. (a) 7,800 533,325
Compaq Computer Corporation 47,500 1,229,062
Dell Computer Corporation (a) 28,000 1,897,000
Pitney Bowes Inc. 13,200 662,475
Unisys Corporation (a) 35,600 676,400
Xerox Corporation 9,900 1,053,731
-----------
6,494,131
-----------
CONSTRUCTION & MINING EQUIPMENT--2.2%
Case Corporation 9,600 654,000
Caterpillar Inc. 16,000 881,000
-----------
1,535,000
-----------
CONSTRUCTION MATERIALS--0.4%
USG Corporation (a) 4,400 238,425
-----------
COSMETICS & TOILETRIES--1.1%
Avon Products Inc. 9,300 725,400
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
DOMESTIC OIL--1.6%
Amerada Hess Corporation 3,900 $ 227,419
Murphy Oil Corporation 6,600 330,825
Phillips Petroleum Company 10,100 504,369
-----------
1,062,613
-----------
DRUGS & HEALTH CARE--8.7%
Baxter International Inc. 10,200 562,275
Biogen Inc. (a) 3,200 154,200
Bristol-Myers Squibb Company 8,400 876,225
Merck & Company Inc. 13,200 1,694,550
Mylan Laboratories Inc. 30,200 694,600
Schering-Plough Corporation 24,200 1,976,838
-----------
5,958,688
-----------
ELECTRIC UTILITIES--1.6%
DTE Energy Company 10,100 397,056
Long Island Lighting Company 12,800 403,200
Rochester Gas & Electric Corporation 9,900 321,750
-----------
1,122,006
-----------
ELECTRICAL EQUIPMENT--3.2%
General Electric Company 18,200 1,568,612
Johnson Controls Inc. 10,600 643,288
-----------
2,211,900
-----------
ELECTRONICS--8.5%
Eaton Corporation 4,200 399,788
General Instrument Corporation (a) 36,000 753,750
Harris Corporation 8,800 458,700
Intel Corporation 13,000 1,014,813
Lexmark International Group Inc. (a) 15,600 703,950
Linear Technology Corporation 11,100 765,900
Lucent Technologies Inc. 3,844 491,552
SCI Systems Inc. (a) 19,200 684,000
Tektronix Inc. 2,500 111,562
Tellabs Inc. (a) 5,800 389,325
-----------
5,773,340
-----------
FINANCIAL SERVICES--1.8%
Federal National Mortgage Association 12,000 759,000
SLM Holding Corporation 10,150 442,794
-----------
1,201,794
-----------
FOOD & BEVERAGES--3.4%
Coca-Cola Company 8,500 658,219
Heinz H.J. Company 14,000 817,250
Interstate Bakeries Corporation 12,000 387,750
McCormick & Company Inc. 15,100 486,975
-----------
2,350,194
-----------
GAS & PIPELINE UTILITIES--0.5%
National Fuel Gas Company (N.J.) 6,700 314,900
-----------
INDUSTRIAL MACHINERY--0.4%
Parker Hannifin Corporation 5,000 256,250
-----------
</TABLE>
- --------------------------------------------------------------------------------
15
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE GROWTH AND INCOME FUND--CONTINUED
- -------------------------------------------------------------------------------
COMMON STOCK--Continued
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
INSURANCE--4.0%
AMBAC Financial Group Inc. 6,200 $ 362,312
Conseco Inc. 16,000 906,000
Everest Reinsurance Holdings 14,800 608,650
Marsh & McLennan Companies Inc. 9,500 829,469
-----------
2,706,431
-----------
INTERNATIONAL OIL--5.5%
Amoco Corporation 3,200 276,400
Chevron Corporation 8,600 690,687
Exxon Corporation 17,300 1,169,913
Mobil Corporation 12,200 934,825
Texaco Inc. 11,400 686,850
-----------
3,758,675
-----------
INVESTMENT COMPANIES--0.8%
Bear Stearns Companies Inc. 10,962 563,173
-----------
NEWSPAPERS--1.4%
Gannett Inc. 13,000 934,375
-----------
PAPER--1.1%
Consolidated Papers Inc. 10,500 672,000
Sonoco Products Company 2,200 88,137
-----------
760,137
-----------
PETROLEUM SERVICES--1.5%
Lyondell Petrochemical Company 19,100 650,594
Rowan Companies Inc. (a) 12,500 362,500
-----------
1,013,094
-----------
PUBLISHING--1.0%
Dun & Bradstreet Corporation 4,200 143,587
McGraw Hill Companies Inc. 7,100 540,044
-----------
683,631
-----------
RAILROADS & EQUIPMENT--0.9%
CSX Corporation 4,400 261,800
Trinity Inds Inc. 6,500 356,687
-----------
618,487
-----------
RETAIL TRADE--7.6%
Dayton Hudson Corporation 17,000 1,496,000
Federated Department Stores Inc. (a) 1,700 88,081
Home Depot Inc. 15,000 1,011,563
May Department Stores Company 10,400 660,400
Supervalu Inc. 16,900 787,962
TJX Companies Inc. 15,600 705,900
Tiffany & Company 9,300 452,794
-----------
5,202,700
-----------
SOFTWARE--5.0%
Autodesk Inc. 16,600 715,875
Compuware Corporation (a) 37,600 1,856,500
Microsoft Corporation (a) 9,400 841,300
-----------
3,413,675
-----------
STEEL--1.0%
USX--U.S. Steel Group 18,100 683,275
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
TELEPHONE--7.0%
AT & T Corporation 18,400 $ 1,207,500
Ameritech Corporation 16,200 800,888
Bell Atlantic Corporation 8,500 871,250
GTE Corporation 13,100 784,362
U.S. West Inc. 20,000 1,095,000
-----------
4,759,000
-----------
TOBACCO--1.2%
Philip Morris Companies Inc. 2,200 91,712
RJR Nabisco Holdings Corporation 3,000 93,938
UST Inc. 12,200 393,450
Universal Corporation VA 5,800 255,563
-----------
834,663
-----------
TOTAL COMMON STOCK
(Cost $46,710,340) (b) $68,304,612
===========
</TABLE>
(a) Non-income producing security.
(b) At March 31, 1998, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $46,710,340 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $21,812,823
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (218,551)
-----------
Net unrealized appreciation $21,594,272
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
- -------------------------------------------------------------------------------
16
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMMON STOCK--97.4%
Shares Value
<S> <C> <C>
ARGENTINA--1.7%
Perez Companc SA, Class B (d) 11,968 $ 162,075
Telefonica De Argentina SA, Class B (d) 2,700 102,769
YPF Sociedad Anonima, Class D (d) 9,100 309,400
-----------
574,244
-----------
AUSTRALIA--0.4%
Westpac Banking Corporation (f) 20,500 137,588
-----------
AUSTRIA--1.1%
Austria Mikros System 20 1,264
Mayr Melnhof Karto 5,450 376,986
-----------
378,250
-----------
BELGIUM--0.5%
Electrabel (f) 625 159,240
-----------
BRAZIL--1.3%
Aracruz Celulose SA (d) 4,550 68,250
Centrais Eletricas Brasileiras (d) 2,900 67,587
Companhia Cerveja Ria Brahma 4,400 68,200
Companhia Siderurgica Nacional (d) 2,100 62,240
Petrobras Distribuidora 3,000 26,438
Telecomunicacoes Brasileiras (d) 1,240 160,968
-----------
453,683
-----------
CHILE--1.3%
Chilectra SA (d) 1,250 33,720
Compania Cervecerias Unidas SA (d) 1,600 48,400
Compania De Telecom De Chile (d) 3,100 85,444
Embotelladora Andina SA, Class A (d) 1,000 23,000
Embotelladora Andina SA, Class B (d) 1,000 20,000
Empresa Nacional De Electricia (d) 4,100 78,925
Enersis SA (d) 2,400 75,750
Sociedad Quimica Minera De Chile, Class B (d) 600 26,400
Vina Concha Y Toro SA (d) 1,200 39,300
-----------
430,939
-----------
CHINA--0.8%
Guangshen Railway Ltd. (d) 7,400 87,875
Jilin Chemical Industrial Ltd., Class H (d) 7,200 85,950
Shanghai Chlor-Alkali Chem Ltd. (d) 41,900 73,325
Shanghai Petrochemical Corporation 1,800 27,788
-----------
274,938
-----------
DENMARK--1.6%
Bang & Olufsen Holding, Class B 600 37,873
Novo-Nordisk AS, Class B (f) 2,950 502,142
-----------
540,015
-----------
FINLAND--6.8%
Kesko OYJ 17,700 286,974
Metra OYJ ABP, Class B 2,300 56,141
Nokia (AB) OY, Class K 8,500 914,408
Stockmann AB (OY), Class B 600 48,426
Upm-Kymmene OY 39,000 993,639
-----------
2,299,588
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
FRANCE--5.6%
AXA-UAP 3,250 $ 334,657
Compagnie Financiere De Paribas, Class A 2,700 273,229
Elf Aquitaine 8,400 1,100,857
Promodes 350 168,281
-----------
1,877,024
-----------
GERMANY--2.5%
Bayerische Hypoth-Und Wechel Bank (f) 12,710 694,122
Bayerische Vereinsbank AG (f) 2,200 160,593
-----------
854,715
-----------
HONG KONG--4.7%
Kumagai Gumi Hong Kong 336,000 213,569
New World Development Company 51,000 180,020
Shangri-La Asia Ltd. 164,000 140,753
Swire Pacific, Class A 24,000 126,996
Wharf (Holdings) 473,000 927,894
-----------
1,589,232
-----------
INDIA--1.2%
Bajaj Auto (e) 3,300 60,555
Grasim Industries (e) 2,700 20,588
Grasim Industries Ltd. (b) (e) 4,100 31,263
Gujarat Ambuja Cements (e) 11,200 72,800
Hindalco Industries Ltd. (b) (e) 2,600 44,122
Indian Hotels Company Ltd. (e) 3,800 63,650
Reliance Industries (e) 9,600 79,200
Steel Authority of India (e) 4,500 17,096
Tata Engineering & Locomotive (e) 4,100 30,416
-----------
419,690
-----------
IRELAND--7.2%
Allied Irish Banks 7,600 93,252
CRH 65,300 981,354
Irish Life 47,700 435,557
Kerry Group, Class A 69,300 922,820
-----------
2,432,983
-----------
ITALY--2.9%
Burgo (Cartiere) Spa (f) 68,600 609,636
Sirti Spa (f) 52,200 358,228
-----------
967,864
-----------
JAPAN--12.8%
Casio Computer Company (f) 58,000 500,169
Chichibu Onoda Cement (f) 214,000 378,718
Chugai Pharmaceutical Company 97,000 632,822
Fujitsu (f) 24,000 250,159
Hitachi 49,000 356,417
Kansai Electric Power (f) 7,000 117,581
Mitsubishi Chemical (f) 86,000 157,999
Mitsubishi Corporation 45,000 367,815
Nippon Oil Company (f) 43,000 150,583
Osaka Gas Company 55,000 120,843
Sekisui House 31,000 253,384
Tokio Marine & Fire Insurance 16,000 178,771
Tokyo Electric Power 29,000 548,011
Toyobo Company (f) 149,000 224,581
Yokogawa Electric 17,000 101,728
-----------
4,339,581
-----------
</TABLE>
- --------------------------------------------------------------------------------
17
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE INTERNATIONAL EQUITY FUND--CONTINUED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMMON STOCK--Continued
Shares Value
<S> <C> <C>
MALAYSIA--3.7%
Golden Hope Plantations 148,000 $ 187,033
Malaysia International Shipping 451,000 867,308
Perusahaan Otomobil Nasional 107,000 186,662
-----------
1,241,003
-----------
MEXICO--2.0%
Kimberly Clark De Mexico SA, Class A (d) 12,200 315,104
Telefonos De Mexico SA, Class L (d) 4,900 276,238
Vitro Sociedad Anonima (d) 7,400 88,800
-----------
680,142
-----------
NETHERLANDS--6.1%
Getronics NV 3,550 152,408
ING Groep NV 3,800 215,638
KLM 22,250 890,128
Koninklijke Hoogovens NV 5,250 253,849
Kon PTT Nederland 6,050 313,426
Philips Electronic 1,900 139,445
Unilever NV 1,600 107,910
-----------
2,072,804
-----------
NEW ZEALAND--2.1%
Fletcher Challenge Ltd. 201,500 694,078
-----------
NORWAY--3.1%
NCL Holdings AS (a) 160,480 728,278
Norske Skogsindust, Class A 9,710 312,022
-----------
1,040,300
-----------
PORTUGAL--2.7%
Banco Comercial Portugues SA (with rights exp. 4/7/98) (d) 3,362 54,422
Banco Comercial Portugues (d) 17,000 545,063
Portugal Telecom SA (d) 6,000 314,625
-----------
914,110
-----------
SINGAPORE--0.2%
Creative Technology (a) 3,000 66,130
-----------
SOUTH AFRICA--1.0%
Anglo American Corporation of South Africa Ltd. (d) 2,400 110,100
Billiton (d) 17,700 53,100
C.G. Smith Ltd. (d) 13,500 62,438
Gencor Ltd. (d) 3,540 6,195
Iscor Ltd. (d) 4,600 12,689
Malbak Ltd. (d) 36,800 29,900
Sasol Ltd. (d) 6,800 55,250
-----------
329,672
-----------
SPAIN--2.3%
Banco Santander SA 800 39,843
Iberdrola SA 48,477 736,348
-----------
776,191
-----------
SWEDEN--2.8%
Skandia Foersaekrings AB 14,620 952,783
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
SWITZERLAND--8.3%
Holderbank Financiere Glaris 280 $ 293,867
Sairgroup 495 691,279
Schweiz-Ruckversicherungs 180 395,421
Schweizerische Bankgesellschaf 875 1,429,157
-----------
2,809,724
-----------
TURKEY--0.8%
Erciyas Biracilik, Class A (e) 30,800 87,780
Tofas Otomobil Fab (e) 420,600 92,532
Turkiye Garanti Bankasi AS (e) 25,854 102,123
-----------
282,435
-----------
UNITED KINGDOM--9.9%
Abbey National 9,400 181,496
Anglian Water 68,000 1,064,706
Barclays 19,900 596,174
British Petroleum 8,900 128,099
British Telecommunications 32,500 352,941
HSBC Holdings 12,300 374,668
Royal Bank of Scotland Group 6,600 102,344
United Utilities 37,848 562,497
-----------
3,362,925
-----------
TOTAL COMMON STOCK
(Cost $28,440,868) $32,951,871
===========
PREFERRED STOCK--0.1%
BRAZIL--0.1%
Companhia Vale Do Rio Doce (d) 1,900 45,284
-----------
TOTAL PREFERRED STOCK
(Cost $44,413) $ 45,284
===========
</TABLE>
- --------------------------------------------------------------------------------
18
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE INTERNATIONAL EQUITY FUND--CONTINUED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHORT TERM INVESTMENTS--2.5%
Par
Value Value
<S> <C> <C>
State Street Repo 4.25%, 4/1/98 (Cost $837,000) (Dated
3/31/98), Collateralized by $835,000 U.S. Treasury Bond
5.875%, 4/30/98, Market Value $855,593, Repurchase
Proceeds $837,099. $837,000 $ 837,000
-----------
TOTAL SHORT TERM INVESTMENTS
(Cost $837,000) $ 837,000
===========
TOTAL INVESTMENTS--100%
(Cost $29,322,281) (c) $33,834,155
===========
</TABLE>
(a) Non-income producing security.
(b) Security exempt from registration under Rule 144A of the Securities Act of
1933. (Note 2)
(c) At March 31, 1998, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $29,733,476 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $ 7,194,719
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (3,094,040)
-----------
Net unrealized appreciation $ 4,100,679
===========
</TABLE>
(d) ADR--American Depository Receipts
(e) GDR--Global Depository Receipts
(f) A portion of security is on loan at 3/31/98 (Note 6).
<TABLE>
<CAPTION>
SECTOR ALLOCATIONS (AS A
PERCENTAGE OF TOTAL COMMON
AND PREFERRED STOCK)
- ---------------------------------
<S> <C>
Basic Industries 12.6%
Capital Goods 1.4%
Consumer Basics 9.5%
Consumer Durable Goods 1.5%
Consumer Non-Durable Goods 4.8%
Consumer Services 7.6%
Energy 5.9%
Finance 22.1%
General Business 6.8%
Miscellaneous 4.2%
Shelter 7.5%
Technology 4.6%
Transportation 2.9%
Utilities 8.6%
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
19
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
COMMON STOCK--89.1%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
ARGENTINA--7.7%
Astra Cia Argentina 71,970 $ 136,757
Banco Frances Rio Plata (a) 14,000 140,014
Central Puerto SA, Class B (a) 20,000 63,206
Irsa Inversiones Y Representac 5,000 18,902
Ledesma Agricola, Class B 70,000 65,106
Telefonica De Argentina, Class B 46,000 175,738
Transport Gas Sur, Class B 14,000 32,553
YPF SA, Class D 4,600 155,956
-----------
788,232
-----------
BRAZIL--2.9%
Centrais Electrobras 3,030,000 140,695
Cia Paulista De Force E Luz (rights exp. 4/7/98) 239 0
Compania Vale Do Rio Doce 500 11,037
Sider Nacional Cia 2,383,000 70,604
Souza Cruz (Cia) 2,300 19,175
Telec Brasileiras--Telebras 528,000 54,560
-----------
296,071
-----------
CHILE--6.0%
Chilectra SA (d) 1,500 41,625
Chilgener SA (a) (d) 1,900 45,719
Compania Cervecerias Unidas SA (d) 2,280 68,970
Compania De Telecomunicaciones De Chile (d) 4,110 113,282
Embotelladora Andina SA, Class A (d) 1,500 34,500
Embotelladora Andina SA, Class B (d) 1,500 30,000
Embotelladora Buenos Aires, Class B 35 1,330
Empresa Nacional De Electricid (d) 5,630 108,377
Enersis SA (d) 3,000 94,687
Madeco SA (d) 2,880 49,860
Maderas Y Sinteticos Sociedad (d) 2,500 25,781
-----------
614,131
-----------
CHINA--5.1%
China International Marine, Class B 19,000 16,013
Guangdon Electric, Class B 42,800 23,200
Guangshen Railway, Class H 202,000 46,405
Huaneng Power International Inc. (a) (d) 6,600 155,100
Maanshan Iron & Steel, Class H 163,400 16,660
Qingling Motors, Class H 119,300 55,429
Shanghai Chlor-Alkali Chemical, Class B 4,350 748
Shanghai Dazhong Taxi, Class B (a) 12,000 8,496
Shanghai Hai Xing Shipping, Class H (a) 402,000 88,719
Shanghai Lujiazhui, Class B (a) 32,320 19,392
Shanghai Petrochemical Company, Class H 331,800 50,102
Shanghai Tyre & Rubber, Class B 32,000 7,360
Tsingtao Brewery, Class H (a) 45,900 10,663
Yizheng Chemical Fibre, Class H 96,000 15,735
-----------
514,022
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
GREECE--8.7%
Alpha Credit Bank 1,985 $ 153,633
Attica Enterprises 2,200 32,679
Attica Enterprises (with rights exp. 4/30/98) 2,200 2,002
Commercial Bank of Greece 1,140 45,988
Delta Dairy 1,830 20,602
Ergo Bank 1,290 92,379
Hellenic Bottling Company 5,460 157,083
Hellenic Sugar Industries 3,072 15,274
Heracles General Cement 2,900 68,106
Intracom 680 38,914
Ionian Bank 1,040 21,904
Naoussa Spinning Mills 5,300 19,557
National Bank of Greece (a) 926 101,351
Titan Cement Company 1,600 116,880
-----------
886,352
-----------
HUNGARY--3.0%
Magyar Olaj-Es Gazipare Resz 3,700 113,443
Matav Rt 8,000 49,319
OTP Bank 2,000 101,732
Pannonplast Muan Yagi Pari 1,000 40,716
-----------
305,210
-----------
INDIA--5.3%
Arvind Mills (a) (e) 8,000 12,000
Bombay Dyeing & Manufacturing (a) (e) 8,100 20,655
Century Textiles (a) (e) 6,000 9,600
Croslands Research Labs Ltd. (a) (b) (e) 1,200 31,356
Grasim Industries Ltd. (a) (b) (e) 2,900 22,113
Gujarat Ambuja Cements (e) 4,300 27,950
India Cements (e) 11,900 17,850
Indian Hotels Ltd. (e) 1,100 18,425
Indian Rayon & Industries (a) (e) 3,450 14,214
Indo Gulf Fertilisers & Chemical (e) 38,200 28,650
ITC Ltd. (e) 4,800 115,920
Larsen & Toubro (e) 3,000 39,375
Mahindra & Mahindra (e) 3,000 24,360
Reliance Industries (a) (e) 7,600 62,700
Southern Petrochemical Industries (b) (e) 10,100 45,955
Tata Engineering & Locomotive (e) 4,000 29,674
United Phosphorus (e) 4,800 14,688
-----------
535,485
-----------
MALAYSIA--3.7%
Golden Hope Plantations 35,000 44,231
Highlands & Lowlands 100,000 113,187
Malaysia International Shipping 35,000 62,500
Pan-Malaysia Cement Works 150,000 53,983
Tenaga Nasional 40,000 101,099
-----------
375,000
-----------
</TABLE>
- --------------------------------------------------------------------------------
20
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE EMERGING MARKETS FUND--CONTINUED
- --------------------------------------------------------------------------------
COMMON STOCK--Continued
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
MEXICO--9.3%
Alfa SA, Class A 6,915 $ 38,967
Cemex SA, Class A 7,300 32,566
Cemex SA, Class B 7,000 37,802
Cifra SA De Cv, Class V 57,388 104,967
El Puerto De Liverpool, Class C 200 319
Empresas La Modern, Class A (a) 15,300 75,710
Fomento Economico Mexico, Class B 14,500 105,371
Grupo Industrial Bimbo, Class A 16,000 42,451
Grupo Mexico, Class B 7,800 25,457
Grupo Televisa SA (a) 2,100 38,632
Kimberly Clark De Mexico, Class B 5,000 23,949
Telefonos De Mexico, Class L 98,400 278,403
Tubos De Acero De Mexico (a) 2,100 39,076
Vitro SA 26,000 103,628
-----------
947,298
-----------
PERU--5.8%
Cementos Lima 2,879 56,381
Cervs Peruanas Backus & Johnston, Class T 51,257 37,779
Cervs Peruanas Backus & Johnston, Class A 5,724 50,952
Credicorp Ltd. 5,520 89,007
Minas Buenaventura, Class B 7,805 64,474
Pacifico Peru-Suiz 2 18
Southern Peru Copper Corporation 1,261 19,073
Telefonica Del Peru, Class B 125,600 268,776
-----------
586,460
-----------
PHILIPPINES--1.7%
Manila Electric Company, Class B 22,000 71,979
Petron Corporation 200,001 31,662
Philippine Long Distance 2,400 66,807
Philippine National Bank 975 2,392
-----------
172,840
-----------
PORTUGAL--10.3%
Banco Commercial Portugues (with rights exp. 4/20/98) 6,600 213,094
Banco Espir Santo 3,500 161,699
BPI Soc Gestora 1,700 65,390
Cimpor Cimentos De Portugal 2,000 70,477
Jeronimo Martins SGPS 2,496 102,663
Modelo Contin SGPS 1,300 101,559
Portugal Telecom 3,328 173,099
Sonae Investimentos 2,400 112,970
Soporcel 1,000 44,616
-----------
1,045,567
-----------
SOUTH AFRICA--4.8%
Adcock Ingram 948 $ 3,763
Anglo American Corporation of South Africa 2,500 114,507
Billiton 20,400 54,654
De Beers Centenary 4,300 93,697
Gencor 4,080 8,340
Liberty Life Association of Africa 2,700 91,090
Metro Cash and Carry 7,284 6,939
Millennium Entertainment 1,512 1,740
Polifin Limited 600 863
Premier Group 12,000 1,738
Sasol 7,700 62,346
South Africa Breweries 1,800 53,368
-----------
493,045
-----------
TAIWAN--8.9%
MSCI Taiwan Index Series (b) (f) 6,700 900,547
-----------
THAILAND--0.0%
One Holding (warrants exp. 10/11/01) 7,940 0
Prime Finance and Securities 131,400 0
-----------
0
-----------
TURKEY--5.9%
Akbank 930,042 67,920
Dogan Holding (a) 2,031,750 73,561
Ford Otomotiv San 40,000 24,686
KOC Holding 321,000 50,847
Konya Cimento 1,524,000 20,692
Sifas (a) 2,214,000 44,179
T Garanti Bankasi 1,441,998 56,955
Turkiye Is Bankasi 1,900,000 203,246
Turk Hava Yollari (a) 214,000 12,767
Vestel Electronic Sanayi Ve T 592,000 46,278
-----------
601,131
-----------
TOTAL COMMON STOCK
(Cost $7,933,462) $ 9,061,391
===========
PREFERRED STOCK--5.9%
BRAZIL--5.9%
Banco Bradesco SA 109,635 1,133
Banco Est Sao Paulo 850,000 56,811
Banco Itau SA 239,000 153,434
Belgo-Mineira 1,600,000 96,034
Bombril Cirio SA 5,000,000 28,142
Cemig Cia Energetica Minas Gerais 720,500 34,976
Compania Vale Do Rio Doce 1,648 39,566
Centrais Electrobras 380,000 18,781
Fosfatados Fertilizantes 11,700,000 52,681
Telec Brasileiras--Telebras 825,000 108,612
Usiminas 1,632 13,204
-----------
603,374
-----------
TOTAL PREFERRED STOCK
(Cost $451,297)
$ 603,374
===========
</TABLE>
- --------------------------------------------------------------------------------
21
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
PORTFOLIO OF INVESTMENTS March 31, 1998
QUANTITATIVE EMERGING MARKETS FUND--CONTINUED
- --------------------------------------------------------------------------------
<TABLE>
SHORT TERM INVESTMENTS--5.0%
<CAPTION>
Par
Value Value
<S> <C> <C>
State Street Repo 4.25%, 4/1/98, (Cost $512,000) (Dated
3/31/98), Collateralized by $510,000 U.S. Treasury Bond
5.875%, 4/30/98, Market Value $522,578, Repurchase
Proceeds $512,060. $512,000 $ 512,000
-----------
TOTAL SHORT TERM INVESTMENTS
(Cost $512,000) $ 512,000
===========
TOTAL INVESTMENTS--100%
(Cost $8,896,759) (c) $10,176,765
===========
</TABLE>
(a) Non-income producing security.
(b) Security exempt from registration under Rule 144A of the Securities Act of
1933. (Note 2)
(c) At March 31, 1998, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $8,994,014 was as follows:
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $ 2,189,273
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (1,006,522)
-----------
Net unrealized appreciation $ 1,182,751
===========
(d) ADR--American Depository Receipts
(e) GDR--Global Depository Receipts
(f) OPAL, Rule 144A stock, issued by Morgan Stanley Capital (Delaware) LLC. An
OPAL represents an optimised portfolio of securities designed to track the
performance of a specific benchmark index in a single trade. Emerging Mar-
kets has the contractual right to exchange the OPAL for the underlying se-
curities, which may not be restricted securities, at any time.
SECTOR ALLOCATIONS (AS A PERCENTAGE OF TOTAL COMMON
AND PREFERRED STOCK)
- ----------------------------------------------------------------------------
Basic Industries 12.6%
Capital Goods 4.4%
Consumer Basics 6.2%
Consumer Durable Goods 1.3%
Consumer Non-Durable Goods 3.9%
Consumer Services 0.3%
Energy 6.5%
Finance 20.4%
General Business 3.9%
Miscellaneous 15.1%
Shelter 3.5%
Technology 1.1%
Transportation 2.5%
Utilities 18.3%
- --------------------------------------------------------------------------------
22
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES March 31, 1998
<TABLE>
<CAPTION>
Growth and International Emerging
Small Cap Mid Cap Income Equity Markets
<S> <C> <C> <C> <C> <C>
ASSETS :
Investments at value
(Note 2)
See accompanying
schedules $72,083,715 $16,744,728 $68,304,612 $33,834,155 $10,176,765
Foreign currency at
value (Cost $ 4,858 for
International Equity and
$ 391,231 for Emerging
Markets) (Note 2) -- -- -- 4,877 384,884
Cash -- 1,242 1,801,067 1,406 405,544
Collateral for
securities loaned at
value (Note 6) -- -- -- 4,198,112 --
Dividends, interest and
foreign tax reclaims
receivable 81,575 3,822 81,321 161,213 13,092
Receivable for
investments sold 2,531,996 -- -- -- --
Receivable for shares of
beneficial interest sold -- 111 50,103 435 --
Other assets 21,249 2,913 14,348 8,895 3,163
----------- ----------- ----------- ----------- -----------
Total assets 74,718,535 16,752,816 70,251,451 38,209,093 10,983,448
----------- ----------- ----------- ----------- -----------
LIABILITIES :
Collateral for
securities loaned (Note
6) -- -- -- 4,198,112 --
Due to custodian 740,312 -- -- -- --
Payable for investments
purchased 668,060 394,796 -- -- 690,782
Payable for shares of
beneficial interest
repurchased 12,840 -- -- 3,811 --
Payable for compensation
of Manager (Note 3) 61,117 17,678 43,806 28,001 6,788
Payable for distribution
fees (Note 3) 27,875 7,557 27,703 13,267 3,825
Payable to custodian 6,332 3,581 3,598 11,617 15,359
Payable to transfer
agent (Note 3) 10,032 1,565 10,023 4,964 1,713
Other accrued expenses 29,953 20,550 46,005 39,239 22,331
----------- ----------- ----------- ----------- -----------
Total liabilities 1,556,521 445,727 131,135 4,299,011 740,798
----------- ----------- ----------- ----------- -----------
NET ASSETS $73,162,014 $16,307,089 $70,120,316 $33,910,082 $10,242,650
----------- ----------- ----------- ----------- -----------
NET ASSETS CONSIST OF :
Shares of beneficial
interest $61,294,469 $12,958,183 $43,087,490 $29,841,039 $11,482,684
Undistributed net
investment income (loss) 947 -- 5,642 (292,161) (68,100)
Accumulated net realized
gain (loss) on
investments and foreign
denominated assets,
liabilities and currency (400,261) 372,811 5,432,912 (147,411) (2,453,704)
Unrealized appreciation
of investments and
foreign denominated
assets, liabilities and
currency 12,266,859 2,976,095 21,594,272 4,508,615 1,281,770
----------- ----------- ----------- ----------- -----------
$73,162,014 $16,307,089 $70,120,316 $33,910,082 $10,242,650
----------- ----------- ----------- ----------- -----------
Investment securities,
at cost $59,816,856 $13,768,633 $46,710,340 $29,322,281 $ 8,896,759
----------- ----------- ----------- ----------- -----------
NET ASSETS
Ordinary Shares $66,876,268 $15,484,375 $66,396,761 $32,182,491 $ 9,240,896
----------- ----------- ----------- ----------- -----------
Institutional Shares $ 6,285,746 $ 822,714 $ 3,723,555 $ 1,727,591 $ 1,001,754
----------- ----------- ----------- ----------- -----------
Shares of beneficial
interest outstanding
(Unlimited number of
shares authorized)
Ordinary Shares 3,757,939 964,744 3,184,634 2,688,423 1,200,611
----------- ----------- ----------- ----------- -----------
Institutional Shares 341,631 50,661 178,632 144,589 129,054
----------- ----------- ----------- ----------- -----------
Net asset value and
offering price per
share*
Ordinary Shares $ 17.80 $ 16.05 $ 20.85 $ 11.97 $ 7.70
----------- ----------- ----------- ----------- -----------
Institutional Shares $ 18.40 $ 16.24 $ 20.84 $ 11.95 $ 7.76
----------- ----------- ----------- ----------- -----------
</TABLE>
* A deferred sales charge amounting to 1% of the net asset value
of the Ordinary Shares redeemed is withheld and paid to the
Distributor. No deferred sales charge is withheld from redemp-
tions of the Institutional Shares. In addition, no deferred
sales charge is withheld from the Ordinary Shares of Mid Cap
purchased after August 1, 1996.
The accompanying notes are an integral part of these financial
statements.
- --------------------------------------------------------------------------------
23
<PAGE>
STATEMENT OF OPERATIONS Year Ended March 31, 1998
<TABLE>
<CAPTION>
Growth and International Emerging
Small Cap Mid Cap Income Equity Markets
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends* $ 330,963 $ 109,716 $ 933,347 $ 827,462 $ 220,734
Interest 68,968 19,230 -- 21,756 13,007
----------- ---------- ----------- ---------- -----------
Total investment income 399,931 128,946 933,347 849,218 233,741
----------- ---------- ----------- ---------- -----------
EXPENSES:
Compensation of Manager
(Note 3) 712,299 122,800 425,583 311,008 86,261
Distribution fees, Or-
dinary Shares (Note 3) 320,707 29,183 273,177 147,117 48,237
Custodian fees 65,338 45,025 50,320 98,890 110,850
Transfer agent fees
(Note 3):
Ordinary Shares 94,444 17,050 79,932 43,182 14,216
Institutional Shares 10,651 879 3,062 2,468 1,675
Audit and legal 63,514 10,607 49,977 27,883 9,703
Registration fees 31,703 5,185 24,465 13,792 4,853
Amortization of organi-
zational expenses (Note
2) 2,952 -- -- -- --
Insurance 20,556 3,408 16,065 8,996 3,143
Compensation of Trust-
ees (Note 3) 12,158 2,015 9,490 5,311 1,855
Printing 14,516 2,466 11,607 6,421 2,214
Miscellaneous 14,253 2,586 10,399 6,144 2,421
----------- ---------- ----------- ---------- -----------
Total expenses before
waivers and/or reim-
bursements, and reduc-
tions 1,363,091 241,204 954,077 671,212 285,428
Waivers and/or reim-
bursements of expenses
(Note 3) (40,002) (48,918) -- (351) --
Fees reduced by credits
allowed by Custodian
(Note 3) (7,665) -- (27,480) (25,878) (12,960)
----------- ---------- ----------- ---------- -----------
EXPENSES, NET 1,315,424 192,286 926,597 644,983 272,468
----------- ---------- ----------- ---------- -----------
Net investment income
(loss) (915,493) (63,340) 6,750 204,235 (38,727)
----------- ---------- ----------- ---------- -----------
REALIZED AND UNREALIZED
GAIN (LOSS) ON
INVESTMENTS, FOREIGN
CURRENCY AND FOREIGN
TRANSLATION:
Net realized gain
(loss) (Note 2) on:
Investments 2,413,066 2,419,921 8,944,446 323,673 (2,126,425)
Foreign denominated as-
sets, liabilities and
currency -- -- -- (103,015) 37,072
Written options -- -- (80,117) -- --
Change in unrealized
appreciation (deprecia-
tion) of:
Investments 20,992,077 2,234,749 14,011,197 3,309,438 188,966
Foreign denominated as-
sets, liabilities and
currency -- -- -- 3,956 1,895
----------- ---------- ----------- ---------- -----------
Net realized and
unrealized gain (loss) 23,405,143 4,654,670 22,875,526 3,534,052 (1,898,492)
----------- ---------- ----------- ---------- -----------
Net increase (decrease)
in net assets resulting
from operations $22,489,650 $4,591,330 $22,882,276 $3,738,287 $(1,937,219)
----------- ---------- ----------- ---------- -----------
</TABLE>
*Dividends are net of foreign withholding taxes of $113,911 for International
Equity, and $14,795 for Emerging Markets.
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
24
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Small Cap Mid Cap Growth and Income
Year ended Year ended Year ended Year ended Year ended Year ended
March 31, 1998 March 31, 1997 March 31, 1998 March 31, 1997 March 31, 1998 March 31, 1997
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN
NET ASSETS :
Operations :
Net investment income
(loss) $ (915,493) $ 693,843 $ (63,340) $ 63,377 $ 6,750 $ 232,397
Net realized gain
(loss) on investments,
foreign denominated
assets, liabilities,
currency and written
options 2,413,066 21,319,089 2,419,921 1,308,543 8,864,329 4,161,193
Distributions of
realized gains from
other investment
companies -- -- -- -- -- --
Unrealized appreciation
(depreciation) of
investments and foreign
denominated assets,
liabilities and
currency 20,992,077 (16,690,396) 2,234,749 124,901 14,011,197 2,948,570
------------ ------------ ----------- ----------- ----------- -----------
Net increase (decrease)
in net assets resulting
from operations 22,489,650 5,322,536 4,591,330 1,496,821 22,882,276 7,342,160
Distributions to
shareholders from :
Net investment income
Ordinary Shares (573,716) -- -- (71,413) (124,594) (259,327)
Institutional Shares (122,203) -- -- (616) (16,181) (23,323)
Distributions in excess
of net investment
income
Ordinary Shares -- -- -- -- -- --
Institutional Shares -- -- -- -- -- --
Net realized gains
Ordinary Shares (8,534,419) (17,582,327) (2,319,745) (1,007,841) (5,343,691) (4,775,270)
Institutional Shares (868,942) (7,604,417) (120,011) (37,397) (185,893) (235,639)
Distributions in excess
of net realized gains
Ordinary Shares -- -- -- -- -- --
Institutional Shares -- -- -- -- -- --
Return of capital
Ordinary Shares (99,481) -- -- -- -- --
Institutional Shares (10,129) -- -- -- -- --
------------ ------------ ----------- ----------- ----------- -----------
(10,208,890) (25,186,744) (2,439,756) (1,117,267) (5,670,359) (5,293,559)
------------ ------------ ----------- ----------- ----------- -----------
Fund share transactions
(Note 11) (5,460,907) (28,214,437) 5,061,374 (1,931,229) 8,109,863 (491,446)
------------ ------------ ----------- ----------- ----------- -----------
Increase (decrease) in
net assets 6,819,853 (48,078,645) 7,212,948 (1,551,675) 25,321,780 1,557,155
Net assets beginning of
year 66,342,161 114,420,806 9,094,141 10,645,816 44,798,536 43,241,381
------------ ------------ ----------- ----------- ----------- -----------
Net assets end of year
(*) $ 73,162,014 $ 66,342,161 $16,307,089 $ 9,094,141 $70,120,316 $44,798,536
============ ============ =========== =========== =========== ===========
(*) Includes
undistributed
(overdistributed) net
investment income of $ 947 693,843 $ -- $ 12,716 $ 5,642 $ 139,667
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
25
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS--CONTINUED
<TABLE>
<CAPTION>
International Equity Emerging Markets
Year ended Year ended Year ended Year ended
March 31, 1998 March 31, 1997 March 31, 1998 March 31, 1997
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN
NET ASSETS :
Operations :
Net investment income
(loss) $ 204,235 $ 33,211 $ (38,727) $ (39,785)
Net realized gain
(loss) on investments,
foreign denominated as-
sets, liabilities, cur-
rency and written op-
tions 220,658 1,835,136 (2,089,353) (128,993)
Distributions of real-
ized gains from other
investment companies -- 47,975 -- --
Unrealized appreciation
(depreciation) of in-
vestments and foreign
denominated assets, li-
abilities and currency 3,313,394 (844,329) 190,861 1,119,489
--------------- --------------- ----------- -----------
Net increase (decrease)
in net assets resulting
from operations 3,738,287 1,071,993 (1,937,219) 950,711
Distributions to share-
holders from :
Net investment income
Ordinary Shares (284,663) (194,106) -- --
Institutional Shares (28,084) (12,144) -- (2,825)
Distributions in excess
of net investment in-
come
Ordinary Shares (157,497) -- -- --
Institutional Shares (15,539) -- -- --
Net realized gains
Ordinary Shares (565,604) -- -- --
Institutional Shares (30,405) -- -- --
Distributions in excess
of net realized gains
Ordinary Shares (118,443) -- -- --
Institutional Shares (6,367) -- -- --
Return of capital
Ordinary Shares -- -- -- --
Institutional Shares -- -- -- --
--------------- --------------- ----------- -----------
(1,206,602) (206,250) -- (2,825)
--------------- --------------- ----------- -----------
Fund share transactions
(Note 11) 2,208,378 (338,691) 916,061 2,579,464
--------------- --------------- ----------- -----------
Increase (decrease) in
net assets 4,740,063 527,052 (1,021,158) 3,527,350
Net assets beginning of
year 29,170,019 28,642,967 11,263,808 7,736,458
--------------- --------------- ----------- -----------
Net assets end of year
(*) $ 33,910,082 $ 29,170,019 $10,242,650 $11,263,808
=============== =============== =========== ===========
(*) Includes undistrib-
uted (overdistributed)
net investment income of $ (292,161) $ 445,299 $ (68,100) $ (101,346)
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
26
<PAGE>
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Income from
Investment Operations
Net Asset Net Realized
Value at Net and Unrealized Total from
Beginning Investment Gain (Loss) Investment
of Period Income on Securities Operations
<S> <C> <C> <C> <C>
SMALL CAP
ORDINARY SHARES
Year Ended March
31, 1994 $14.12 (0.09) 2.57 2.48
Year Ended March
31, 1995 (f) $15.33 (0.20) 1.67 1.47
Year Ended March
31, 1996 (f) $15.81 (0.21)(a) 5.54 5.33
Year Ended March
31, 1997 (f) $18.91 0.16 (a)(h) 0.77 0.93
Year Ended March
31, 1998 (f) $15.04 (0.23)(a) 5.60 5.37
INSTITUTIONAL
SHARES (D)
Year Ended March
31, 1994 $14.15 (0.05) 2.63 2.58
Year Ended March
31, 1995 (f) $15.46 (0.13) 1.71 1.58
Year Ended March
31, 1996 (f) $16.05 (0.12)(a) 5.63 5.51
Year Ended March
31, 1997 (f) $19.33 0.08 (a)(h) 0.94 1.02
Year Ended March
31, 1998 (f) $15.55 (0.15)(a) 5.79 5.64
MID CAP
ORDINARY SHARES
Oct. 3, 1994**
to March 31,
1995 (f) $10.00 0.05 (a) 0.07 0.12
Year Ended March
31, 1996 (f) $10.12 0.06 (a) 3.27 3.33
Year Ended March
31, 1997 (f) $13.20 0.09 (a) 2.29 2.38
Year Ended March
31, 1998 (f) $13.44 (0.08)(a) 6.06 5.98
INSTITUTIONAL
SHARES
April 17, 1995**
to March 31,
1996 (f) $10.27 0.10 (a) 3.09 3.19
Year Ended March
31, 1997 (f) $13.20 0.11 (a) 2.27 2.38
Year Ended March
31, 1998 (f) $13.55 (0.06)(a) 6.12 6.06
GROWTH AND
INCOME
ORDINARY SHARES
Year Ended March
31, 1994 $17.27 0.18 0.21 0.39
Year Ended March
31, 1995 (f) $13.86 0.14 1.44 1.58
Year Ended March
31, 1996 (f) $13.72 0.12 (a) 2.89 3.01
Year Ended March
31, 1997 (f) $14.57 0.08 (a) 2.53 2.61
Year Ended March
31, 1998 (f) $15.22 0.00 7.61 7.61
INSTITUTIONAL
SHARES (D)
Year Ended March
31, 1994 $17.28 0.28 0.19 0.47
Year Ended March
31, 1995 (f) $13.86 0.21 1.44 1.65
Year Ended March
31, 1996 (f) $13.72 0.20 (a) 2.89 3.09
Year Ended March
31, 1997 (f) $14.58 0.15 (a) 2.55 2.70
Year Ended March
31, 1998 (f) $15.24 0.10 7.60 7.70
<CAPTION>
Distributions
Dividends
Dividends in excess of Distributions Distributions Net Assets
from Net Net from in excess of Net Asset End of
Investment Investment Realized Realized Total Value End Total Period
Income Income Capital Gains Capital Gains Distributions of Period Return(c) (000's)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
SMALL CAP
ORDINARY SHARES
Year Ended March
31, 1994 -- -- (1.27) -- (1.27) $15.33 17.80% $40,852
Year Ended March
31, 1995 (f) -- -- (0.99) -- (0.99) $15.81 10.24% $53,920
Year Ended March
31, 1996 (f) -- -- (2.23) -- (2.23) $18.91 34.25% $71,618
Year Ended March
31, 1997 (f) -- -- (4.80) -- (4.80) $15.04 1.72% $57,135
Year Ended March
31, 1998 (f) (0.16) -- (2.45)(i) -- (2.61) $17.80 37.79% $66,876
INSTITUTIONAL
SHARES (D)
Year Ended March
31, 1994 -- -- (1.27) -- (1.27) $15.46 18.50% $24,175
Year Ended March
31, 1995 (f) -- -- (0.99) -- (0.99) $16.05 10.88% $47,044
Year Ended March
31, 1996 (f) -- -- (2.23) -- (2.23) $19.33 34.89% $42,803
Year Ended March
31, 1997 (f) -- -- (4.80) -- (4.80) $15.55 2.21% $ 9,207
Year Ended March
31, 1998 (f) (0.34) -- (2.45)(i) -- (2.79) $18.40 38.44% $ 6,286
MID CAP
ORDINARY SHARES
Oct. 3, 1994**
to March 31,
1995 (f) -- -- -- -- -- $10.12 1.20% $ 420
Year Ended March
31, 1996 (f) (0.01) -- (0.24) -- (0.25) $13.20 33.01% $ 6,025
Year Ended March
31, 1997 (f) (0.14) -- (2.00) -- (2.14) $13.44 17.47% $ 8,733
Year Ended March
31, 1998 (f) -- -- (3.37) -- (3.37) $16.05 46.76% $15,484
INSTITUTIONAL
SHARES
April 17, 1995**
to March 31,
1996 (f) (0.02) -- (0.24) -- (0.26) $13.20 31.12% $ 4,621
Year Ended March
31, 1997 (f) (0.03) -- (2.00) -- (2.03) $13.55 17.51% $ 361
Year Ended March
31, 1998 (f) -- -- (3.37) -- (3.37) $16.24 47.01% $ 823
GROWTH AND
INCOME
ORDINARY SHARES
Year Ended March
31, 1994 (0.16) -- (3.64) -- (3.80) $13.86 1.51% $36,510
Year Ended March
31, 1995 (f) (0.16) -- (1.56) -- (1.72) $13.72 12.71% $37,048
Year Ended March
31, 1996 (f) (0.13) -- (2.03) -- (2.16) $14.57 22.17% $41,353
Year Ended March
31, 1997 (f) (0.10) -- (1.86) -- (1.96) $15.22 17.97% $43,266
Year Ended March
31, 1998 (f) (0.05) -- (1.93) -- (1.98) $20.85 51.52% $66,397
INSTITUTIONAL
SHARES (D)
Year Ended March
31, 1994 (0.25) -- (3.64) -- (3.89) $13.86 1.99% $ 3,990
Year Ended March
31, 1995 (f) (0.23) -- (1.56) -- (1.79) $13.72 13.29% $ 1,975
Year Ended March
31, 1996 (f) (0.20) -- (2.03) -- (2.23) $14.58 22.75% $ 1,888
Year Ended March
31, 1997 (f) (0.18) -- (1.86) -- (2.04) $15.24 18.62% $ 1,532
Year Ended March
31, 1998 (f) (0.17) -- (1.93) -- (2.10) $20.84 52.18% $ 3,724
<CAPTION>
Ratios and Supplemental Data
Ratio of Ratio of Net
Operating Investment
Expenses Income Loss) Average
to Average to Average Portfolio Commission
Net Assets Net Assets Turnover Rate(g)
<S> <C> <C> <C> <C>
SMALL CAP
ORDINARY SHARES
Year Ended March
31, 1994 1.83% (1.30)% 389.00% --
Year Ended March
31, 1995 (f) 1.84% (1.31)% 320.00% --
Year Ended March
31, 1996 (f) 1.97%* (1.17)% 324.00% --
Year Ended March
31, 1997 (f) 1.97%* 0.90 %(h) 393.00% $0.0305
Year Ended March
31, 1998 (f) 1.90%* (1.33)% 135.00% $0.0406
INSTITUTIONAL
SHARES (D)
Year Ended March
31, 1994 1.23% (0.70)% 389.00% --
Year Ended March
31, 1995 (f) 1.36% (0.82)% 320.00% --
Year Ended March
31, 1996 (f) 1.47%* (0.67)% 324.00% --
Year Ended March
31, 1997 (f) 1.47%* 0.41 %(h) 393.00% $0.0305
Year Ended March
31, 1998 (f) 1.41%* (0.86)% 135.00% $0.0406
MID CAP
ORDINARY SHARES
Oct. 3, 1994**
to March 31,
1995 (f) -- % 1.50 %(b) 0.00%(b) --
Year Ended March
31, 1996 (f) 2.34%* 0.46 % 181.00% --
Year Ended March
31, 1997 (f) 1.19%* 0.62 % 162.00% $0.0492
Year Ended March
31, 1998 (f) 1.57% (0.52)% 128.00% $0.0466
INSTITUTIONAL
SHARES
April 17, 1995**
to March 31,
1996 (f) 2.02%(b)* 0.87 %(b) 181.00% --
Year Ended March
31, 1997 (f) 1.44%* 0.77 % 162.00% $0.0492
Year Ended March
31, 1998 (f) 1.40% (0.35)% 128.00% $0.0466
GROWTH AND
INCOME
ORDINARY SHARES
Year Ended March
31, 1994 1.72% 1.02 % 110.00% --
Year Ended March
31, 1995 (f) 1.69% 1.01 % 121.00% --
Year Ended March
31, 1996 (f) 1.73%* 0.81 % 152.00% --
Year Ended March
31, 1997 (f) 1.73%* 0.50 % 98.00% $0.0397
Year Ended March
31, 1998 (f) 1.69%* (0.01)% 72.00% $0.0368
INSTITUTIONAL
SHARES (D)
Year Ended March
31, 1994 1.22% 1.52 % 110.00% --
Year Ended March
31, 1995 (f) 1.23% 1.48 % 121.00% --
Year Ended March
31, 1996 (f) 1.24%* 1.31 % 152.00% --
Year Ended March
31, 1997 (f) 1.24%* 0.99 % 98.00% $0.0397
Year Ended March
31, 1998 (f) 1.19%* 0.50 % 72.00% $0.0368
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
27
<PAGE>
FINANCIAL HIGHLIGHTS--Continued
<TABLE>
<CAPTION>
Income from
Investment Operations
Net Asset Net Realized
Value at Net and Unrealized Total from
Beginning Investment Gain (Loss) Investment
of Period Income on Securities Operations
<S> <C> <C> <C> <C>
INTERNATIONAL
EQUITY
ORDINARY SHARES
Year Ended March
31, 1994 $ 8.03 0.00 (a) 2.28 2.28
Year Ended March
31, 1995 (f) $10.18 (0.03)(a) 0.04 0.01
Year Ended March
31, 1996 (f) $10.06 0.00 (a) 0.67 0.67
Year Ended March
31, 1997 (f) $10.70 0.01 (a) 0.40 0.41
Year Ended March
31, 1998 (f) $11.03 0.07 (a) 1.30 1.37
INSTITUTIONAL
SHARES (D)
April 1, 1991 to
March 19, 1992 $ 9.40 0.09 (a) (1.40) (1.31)
August 25,
1994** to March
31,
1995 (f) $11.00 0.01 (a) (0.73) (0.72)
Year Ended March
31, 1996 (f) $10.10 0.04 (a) 0.66 0.70
Year Ended March
31, 1997 (f) $10.73 0.06 (a) 0.41 0.47
Year Ended March
31, 1998 (f) $11.10 0.14 (a) 1.28 1.42
EMERGING MARKETS
ORDINARY SHARES
August 8, 1994**
to March 31,
1995 (f) $10.00 (0.05)(a) (2.71) (2.76)
Year Ended March
31, 1996 (f) $ 7.24 (0.07)(a) 1.21 1.14
Year Ended March
31, 1997 (f) $ 8.38 (0.04)(a) 0.90 0.86
Year Ended March
31, 1998 (f) $ 9.24 (0.04) (1.50) (1.54)
INSTITUTIONAL
SHARES
April 2, 1996**
to March 31,
1997 (f) $ 8.49 0.01 (a) 0.80 0.81
Year Ended March
31, 1998 (f) $ 9.27 0.02 (1.53) (1.51)
<CAPTION>
Distributions
Dividends
Dividends in excess of Distributions Distributions
from Net Net from in excess of Net Asset
Investment Investment Realized Realized Total Value End Total
Income Income Capital Gains Capital Gains Distributions of Period Return(c)
<S> <C> <C> <C> <C> <C> <C> <C>
INTERNATIONAL
EQUITY
ORDINARY SHARES
Year Ended March
31, 1994 (0.13) -- -- -- (0.13) $10.18 28.69 %
Year Ended March
31, 1995 (f) (0.13) -- -- -- (0.13) $10.06 0.07 %
Year Ended March
31, 1996 (f) (0.03) -- -- -- (0.03) $10.70 6.63 %
Year Ended March
31, 1997 (f) (0.08) -- -- -- (0.08) $11.03 3.82 %
Year Ended March
31, 1998 (f) (0.11) (0.06) (0.21) (0.05) (0.43) $11.97 12.95 %
INSTITUTIONAL
SHARES (D)
April 1, 1991 to
March 19, 1992 (0.15) -- -- -- (0.15) $ 7.94(e) (14.62)%(b)
August 25,
1994** to March
31,
1995 (f) (0.18) -- -- -- (0.18) $10.10 (6.57)%
Year Ended March
31, 1996 (f) (0.07) -- -- -- (0.07) $10.73 6.95 %
Year Ended March
31, 1997 (f) (0.10) -- -- -- (0.10) $11.10 4.38 %
Year Ended March
31, 1998 (f) (0.20) (0.11) (0.21) (0.05) (0.57) $11.95 13.50 %
EMERGING MARKETS
ORDINARY SHARES
August 8, 1994**
to March 31,
1995 (f) -- -- -- -- -- $ 7.24 (27.60)%
Year Ended March
31, 1996 (f) -- -- -- -- -- $ 8.38 15.75 %
Year Ended March
31, 1997 (f) -- -- -- -- -- $ 9.24 10.26 %
Year Ended March
31, 1998 (f) -- -- -- -- -- $ 7.70 (16.67)%
INSTITUTIONAL
SHARES
April 2, 1996**
to March 31,
1997 (f) (0.03) -- -- -- (0.03) $ 9.27 9.54 %
Year Ended March
31, 1998 (f) -- -- -- -- -- $ 7.76 (16.29)%
<CAPTION>
Ratios and Supplemental Data
Ratio of Ratio of Net
Net Assets Operating Investment
End of Expenses Income Loss) Average
Period to Average to Average Portfolio Commission
(000's) Net Assets Net Assets Turnover Rate(g)
<S> <C> <C> <C> <C> <C>
INTERNATIONAL
EQUITY
ORDINARY SHARES
Year Ended March
31, 1994 $26,222 2.01% (0.08)% 40.00% --
Year Ended March
31, 1995 (f) $27,657 1.91% (0.24)% 46.48% --
Year Ended March
31, 1996 (f) $27,402 2.15%* (0.04)% 43.00% --
Year Ended March
31, 1997 (f) $27,410 2.20%* 0.10 % 135.00% $0.0140
Year Ended March
31, 1998 (f) $32,182 2.18%* 0.62 % 61.00% $0.0095
INSTITUTIONAL
SHARES (D)
April 1, 1991 to
March 19, 1992 $ 0 1.63% 1.05 % 52.00% --
August 25,
1994** to March
31,
1995 (f) $ 3,052 1.66%(b) 0.13 %(b) 46.48%(b) --
Year Ended March
31, 1996 (f) $ 1,241 1.65%* 0.38 % 43.00% --
Year Ended March
31, 1997 (f) $ 1,760 1.69%* 0.51 % 135.00% $0.0140
Year Ended March
31, 1998 (f) $ 1,728 1.68%* 1.19 % 61.00% $0.0095
EMERGING MARKETS
ORDINARY SHARES
August 8, 1994**
to March 31,
1995 (f) $ 4,259 2.54%(b) (1.03)%(b) 10.72%(b) --
Year Ended March
31, 1996 (f) $ 7,736 2.74%* (0.84)% 9.00% --
Year Ended March
31, 1997 (f) $10,052 2.68%* (0.47)% 8.00% $0.0024
Year Ended March
31, 1998 (f) $ 9,241 2.69%* (0.43)% 52.00% $0.0008
INSTITUTIONAL
SHARES
April 2, 1996**
to March 31,
1997 (f) $ 1,212 2.01%(b)* 0.13 %(b) 8.00%(b) $0.0024
Year Ended March
31, 1998 (f) $ 1,002 2.19%* 0.24 % 52.00% $0.0008
</TABLE>
* EXPENSE RATIOS FOR THE YEARS ENDED MARCH 31, 1998, MARCH 31, 1997 AND MARCH
31, 1996 ARE SHOWN GROSS OF CUSTODY CREDITS (NOTE 3) IN ACCORDANCE WITH SEC
REGULATIONS. THESE CREDITS ARE GENERATED BY INTEREST EARNED ON UNINVESTED
CASH BALANCES MAINTAINED BY THE FUNDS, AND ARE USED TO OFFSET CUSTODIAL EX-
PENSES OF THE FUND. THE FUNDS' EXPENSE RATIOS NET OF SUCH CREDITS, AS RE-
PORTED IN PRIOR PERIODS, WOULD HAVE BEEN AS FOLLOWS: SMALL CAP ORDINARY AND
INSTITUTIONAL SHARES, 1.89%, 1.90%, 1.88% AND 1.40%, 1.40%, 1.38%, RESPEC-
TIVELY, FOR THE PERIODS ENDED MARCH 31, 1998, 1997 AND 1996; MID CAP ORDI-
NARY AND INSTITUTIONAL SHARES,1.11%, 1.92% AND 1.27%, 1.66% (ANNUALIZED),
RESPECTIVELY, FOR THE PERIODS ENDED MARCH 31, 1997 AND 1996; GROWTH AND IN-
COME ORDINARY AND INSTITUTIONAL SHARES, 1.65%, 1.70%, 1.64% AND 1.14%,
1.21%, 1.15%, RESPECTIVELY, FOR THE PERIODS ENDED MARCH 31, 1998, 1997 AND
1996; INTERNATIONAL EQUITY ORDINARY AND INSTITUTIONAL SHARES, 2.03%, 2.15%,
2.09% AND 1.54%, 1.64%, 1.59%, RESPECTIVELY, FOR THE PERIODS ENDED MARCH 31,
1998, 1997 AND 1996; AND EMERGING MARKETS ORDINARY AND INSTITUTIONAL SHARES,
2.57%, 2.56%, 2.59% AND 2.07%, 1.89% (ANNUALIZED), --, RESPECTIVELY FOR THE
PERIODS ENDED MARCH 31, 1998, 1997 AND 1996.
** Commencement of Operations
(a) Reflects expense waivers/reimbursements and reductions in effect during
the period. See Note 3 to the Financial Statements. As a result of such
waivers/reimbursements and reductions, expenses of the Small Cap Ordinary
Shares for the periods ended March 31, 1998, 1997, and 1996 reflect a re-
duction of $0.01, $0.02 and $0.02 per share; expenses of the Small Cap In-
stitutional Shares for the periods ended March 31, 1998, 1997 and 1996 re-
flect a reduction of $0.01, $0.02 and $0.02 per share; expenses of the Mid
Cap Ordinary Shares for the periods ended March 31, 1998, 1997, 1996 and
1995 reflect a reduction of $0.07, $0.15, $0.23 and $0.76 per share; ex-
penses of the Mid Cap Institutional Shares for the periods ended March 31,
1998, 1997, and 1996 reflects a reduction of $0.06, $0.10 and $0.11 per
share; expenses of the Growth and Income Ordinary Shares for the periods
ended March 31, 1997 and 1996 reflect a reduction of $0.01 and $0.01 per
share; expenses of the Growth and Income Institutional Shares for the pe-
riods ended March 31, 1997 and 1996 reflect a reduction of $0.01 and $0.01
per share; expenses of the International Equity Ordinary Shares for the
periods ended March 31, 1998, 1997, 1996, 1995 and 1994 reflect a reduc-
tion of $--, $0.01 $0.01, $0.01 and $0.01 per share respectively; expenses
of the International Equity Institutional Shares for the periods ended
March 31, 1998, 1997, 1996, 1995 and 1992 reflect a reduction of $--,
$0.02, $0.01, $0.01 and $0.04 per share; and expenses of the Emerging Mar-
kets Ordinary Shares for the periods ended March 31, 1997, 1996 and 1995
reflect a reduction of $0.01, $0.01 and $0.02 per share; expenses of the
Emerging Markets Institutional Shares for the period ended March 31, 1997
reflects a reduction of $0.02 per share.
(b) Annualized
(c) Total Return does not include the one time deferred sales charge of 1% for
the Ordinary Shares. Effective August 1, 1996 Mid Cap Ordinary Shares are
no longer subject to the deferred sales charge of 1%. The total return
would have been lower if certain fees had not been waived or if custodial
fees had not been reduced by credits allowed by the custodian.
(d) Investment income and expenses for the periods ending March 31, 1991
through March 31, 1994 were calculated for the Ordinary Shares and then
adjusted for the differences in distribution and transfer agency expenses
borne by the two classes of shares.
(e) Amount represents the last net asset value per share before the March 19,
1992 redemption which resulted in this Fund having no Institutional Share-
holders and no Institutional Shares of beneficial interest outstanding
from that date until August 25, 1994.
(f) Per share numbers have been calculated using the average shares method. In
accordance with SEC reporting requirements the average commission rate has
been calculated for fiscal years beginning on or after September 1, 1995.
(g) In accordance with SEC reporting requirements, the average commission ra-
tio has been calculated for fiscal years beginning on or after December 1,
1995.
(h) Net investment income per share and the net investment income ratio would
have been lower without a certain investment strategy followed by the
subadvisor during the fiscal year ended March 31, 1997.
(i) Represents $2.42 per share of distributions from realized capital gains
and $0.03 per share of a return of capital.
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
28
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
NOTES TO FINANCIAL STATEMENTS
1. Organization of the Trust.
The Quantitative Group of Funds (the "Trust") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940, as
amended, as a non-diversified, open-end management investment company. The
Trust currently has five series (individually a "Fund" and collectively the
"Funds") each with a distinct investment objective: Quantitative Small Cap,
Quantitative Mid Cap, Quantitative Growth and Income, Quantitative Interna-
tional Equity, and Quantitative Emerging Markets. Quantitative Small Cap,
Quantitative Mid Cap and Quantitative Emerging Markets were formerly known as
Quantitative Numeric, Quantitative Numeric II, and Quantitative Foreign Fron-
tier respectively.
The Quantitative Small Cap Fund ("Small Cap") seeks maximum long-term capital
appreciation by investing primarily in common stocks of companies with smaller
($1 billion or less) market capitalizations or larger companies with higher
than average expected earnings growth rates.
The Quantitative Mid Cap Fund ("Mid Cap") seeks long-term growth of capital by
investing primarily in common stock of companies with medium ($1 billion to $5
billion) market capitalizations.
The Quantitative Growth and Income Fund ("Growth and Income") seeks long-term
growth of capital and income by investing primarily in common stocks of larger
companies having substantial equity capital that are currently paying divi-
dends.
The Quantitative International Equity Fund ("International Equity") seeks
long-term capital growth and income by investing primarily in foreign securi-
ties. Generally, the Fund invests in Western Europe, Australia, and the larger
capital markets in the Far East.
The Quantitative Emerging Markets Fund ("Emerging Markets") seeks long-term
growth of capital by investing in securities of foreign issuers located in
emerging markets.
Holders of Institutional Shares bear no portion of the 12b-1 Plan expense of
the Funds and are not entitled to vote on matters involving the 12b-1 Plan.
Ordinary Shares are sold subject to a 12b-1 Plan and, for Small Cap, Growth
and Income, International Equity and Emerging Markets, a deferred sales
charge. Prior to August 1, 1996, Ordinary Shares of Mid Cap were sold subject
to the deferred sales charge.
2. Significant Accounting Policies.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements. The policies are in
conformity with generally accepted accounting principles for investment compa-
nies, which require management to make estimates and assumptions that affect
the reported amounts and disclosures in the financial statements. Actual re-
sults could differ from these estimates.
Security Valuation.
Portfolio securities are valued each business day at the last reported sale
price on the principal exchange or market on which they are traded. If there
is no such reported sale, the securities are valued at the mean between the
last reported bid and asked price. Short-term investments that mature in 60
days or less are valued at amortized cost. Securities quoted in foreign cur-
rencies are translated into U.S. dollars based upon the prevailing exchange
rate on each business day. Other assets and securities for which no quotations
are readily available are valued at fair value as determined in good faith us-
ing procedures approved by the Trustees.
Security Transactions and Related Investment Income.
Security transactions are accounted for on the trade date (the date the order
to buy or sell is executed). Dividend income is recorded on the ex-dividend
date, except that certain dividends from foreign securities are recorded as
soon as the Funds are informed of the ex-dividend date. Interest income is re-
corded on the accrual basis. In determining the net gain or loss on securities
sold, the cost of securities is determined on the identified cost basis. Each
Fund's investment income and realized and unrealized gains and losses are al-
located among classes based upon the daily relative net assets.
Repurchase Agreements.
The Funds' custodian takes possession through the federal book-entry system of
securities collateralizing repurchase agreements. Collateral is marked-to-mar-
ket daily to ensure that the market value of the underlying assets remains
sufficient to protect the Funds. The Funds may experience costs and delays in
liquidating the collateral if the issuer defaults or enters into bankruptcy.
Options.
Premiums received by the Funds upon writing put or call options are recorded
as an asset with a corresponding liability which is subsequently adjusted to
the current market value of the option. When an option expires, is exercised,
or is closed,
- --------------------------------------------------------------------------------
29
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
NOTES TO FINANCIAL STATEMENTS--Continued
the Funds realize a gain or loss, and the liability is eliminated. The Funds
continue to bear the risk of adverse movements in the price of the underlying
asset during the period of the option, although any potential loss during the
period would be reduced by the amount of the option premium received. Pur-
chased options and the liability related to premiums received on written op-
tions are valued based upon their quoted daily settlement price.
Option Contracts Written.
The number of contracts and premium amounts associated with call option con-
tracts written by Growth and Income for the year ended March 31, 1998 were as
follows:
<TABLE>
<CAPTION>
Number of Premium
Contracts Amount
<S> <C> <C>
Balance at 3/31/97 -- --
Opened 390 94,411
Closed or expired (390) (94,411)
Exercised -- --
---- -------
Balance at 3/31/98 -- --
</TABLE>
Foreign Currency Transactions.
All monetary items denominated in foreign currencies are translated into U.S.
dollars based on the prevailing exchange rate at the close of each business
day. Income and expenses denominated in foreign currencies are translated at
the prevailing rates of exchange when accrued or incurred.
Reported net realized gains and losses on foreign currency transactions repre-
sent net gains and losses from currency gains and losses realized between the
trade and settlement dates on investment transactions, and the difference be-
tween the amount of net investment income accrued and the U.S. dollar amount
actually received. The effects of changes in foreign currency exchange rates
on investments in securities are not segregated in the Statement of Operations
from the effects of changes in market prices of those securities, but are in-
cluded with the net realized and unrealized gain or loss on investments.
Restricted Securities.
The Funds are permitted to invest in securities that are subject to legal or
contractual restrictions on resale. These securities may be resold in transac-
tions exempt from registration or to the public if the securities are regis-
tered. One type of exempt transaction is a sale to certain qualified institu-
tional buyers under Rule 144A of the Securities Act of 1933. Disposal of these
securities may involve time-consuming negotiations and expense, and prompt
sale at an acceptable price may be difficult. At the end of the period, re-
stricted securities amounted to $75,385 or 0% of net assets of International
Equity; $999,971 or 10% of net assets of Emerging Markets; and $0 for each of
Small Cap, Mid Cap, and Growth and Income.
Unamortized Organization Expenses.
Costs incurred with Small Cap's organization and registration were amortized
over the period of benefit, not exceeding 60 months. All costs are now fully
amortized.
Expenses.
The majority of the expenses of the Funds are attributed to the individual
Funds for which they are incurred. Expenses that are not attributed to a spe-
cific Fund are allocated in proportion to the respective net assets of the
Funds. Expenses allocable to a Fund are borne pro rata by the holders of both
classes of shares of such Fund, except that 12b-1 Plan expenses will not be
borne by the holders of Institutional Shares and each class has its own trans-
fer agency fee.
3. Management Fee, Advisory Contracts and
Other Affiliate Transactions.
The Funds have entered into a management agreement with Quantitative Advisors,
Inc. (the "Manager"). Compensation of the Manager, for management and adminis-
tration of the Funds, including selection and monitoring of the portfolio ad-
visors, is paid monthly based on the average daily net asset value of each
Fund for the month. The annual rate of such fees is 1.00% of the average daily
net asset value of Small Cap, Mid Cap, and International Equity; 0.75% of the
average daily net asset value of the Growth and Income Fund; and 0.80% of the
average daily net asset value of Emerging Markets.
Under the management agreement, the Manager has agreed to reduce its compensa-
tion with respect to Small Cap, Growth and Income, and International Equity to
the extent that the total expenses of any of these Funds individually exceed
2% of average net asset value for any fiscal year. The Manager has also volun-
tarily agreed to waive fees or assume certain operating expenses of Mid Cap
and Emerging Markets in order to reduce the total expenses of these Funds to
no more than 1.65% and 2.45%, respectively, of their average net assets. The
distribution agreement calls for the Distributor to reduce its fee similarly
after the Manager's fee has been eliminated. The Manager has also agreed to
assume expenses of any of these Funds if necessary in order to reduce their
total expenses to no more than 2% of average net assets for any fiscal year.
Fund expenses subject to this limitation are exclusive of brokerage, interest,
taxes and extraordinary expenses, which include incremental custody costs as-
sociated with international securities. Expenses are calculated gross of cus-
tody credits, if applicable.
- --------------------------------------------------------------------------------
30
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
NOTES TO FINANCIAL STATEMENTS--Continued
For the year ended March 31, 1998, the fees waived or expenses reimbursed by
the Manager amounted to $40,002, $34,313, and $351 for Small Cap, Mid Cap, and
International Equity respectively. The aggregate management fees, net of fees
waived or reimbursed by the Manager amounted to $1,583,285.
The Manager has entered into advisory contracts with the following advisors
(collectively the "Advisors") to provide investment advisory services to the
following Funds: Columbia Partners, L.L.C., Investment Management (Small Cap,
Mid Cap), State Street Bank and Trust Company (Growth and Income), and Inde-
pendence International Associates, Inc. (International Equity, Emerging Mar-
kets).
For services rendered, the Manager pays to the Advisor of a Fund a fee based
on a percentage of the average daily net asset value of the Fund. The fee for
each Fund is determined separately. The fees paid by the Manager to the Advi-
sors of the Funds are as follows: Small Cap and International Equity Funds--
0.50% of average daily total net assets; Mid Cap and Emerging Markets Funds--
0.40% of average daily total net assets; and Growth and Income--0.375% of the
first $20 million and 0.30% of amounts in excess of $20 million of average
daily total net assets, with an annual minimum of $25,000.
The Funds have entered into a distribution agreement with U.S. Boston Capital
Corporation (the "Distributor"). For its services under the distribution
agreement, the Distributor receives a monthly fee at the annual rate of (i)
0.50% of the average net asset value of Ordinary Shareholder accounts of Small
Cap, Growth and Income, International Equity and Emerging Markets and (ii)
0.25% of the average net asset value of Ordinary Shareholder accounts of Mid
Cap open during the period the plan is in effect. Prior to August 1, 1996, the
annual rate for Mid Cap accounts was 0.50%. No fees are received by the Dis-
tributor for Institutional Shares. For the year ended March 31, 1998, the Dis-
tributor voluntarily agreed to waive its fees in part with respect to Mid Cap,
which amounted to $8,737. During the year ended March 31, 1998, the aggregate
fees, net of fees waived by the Distributor, paid by the Funds pursuant to
such distribution plan amounted to $809,684. A deferred sales charge amounting
to 1% of the net asset value of Ordinary Shares redeemed of Small Cap, Growth
and Income, International Equity and Emerging Markets is withheld from the re-
demption proceeds and paid to the Distributor. The deferred sales charge is
also imposed on redemptions of Ordinary Shares of Mid Cap purchased prior to
August 1, 1996. The deferred sales charge is not imposed on redemptions of In-
stitutional Shares, and certain other transactions. The Funds have been ad-
vised that during the year ended March 31, 1998, such fees earned by the Dis-
tributor were $207,769.
Transfer agent functions are provided to the Funds by Quantitative Institu-
tional Services, a division of the Manager (the "Transfer Agent") pursuant to
a transfer agent agreement. The transfer agent agreement provides for base
fees that are payable to the Transfer Agent at an annual rate of 0.13% of the
aggregate average daily net asset value of each class of shares of each Fund
and for reimbursement of out of pocket expenses. During the year ended March
31, 1998, the aggregate fees, net of fees waived by the Transfer Agent, paid
by the Funds pursuant to such agreement amounted to $261,691. For the year
ended March 31, 1998, the Transfer Agent voluntarily agreed to waive its fees
in part with respect to Mid Cap which amounted to $5,868.
State Street Bank and Trust Company ("State Street") maintained the Funds' ac-
counting records and provided custodial services through January 20, 1998. Ef-
fective January 21, 1998, custody and fund accounting services are provided by
Investors Fiduciary Trust Company ("IFTC"), a wholly owned subsidiary of State
Street. Custody credits generated by interest earned on uninvested cash bal-
ances maintained by the Funds are used to offset custodial expenses of the
Funds.
Each Trustee receives an annual Trustee's fee of $4,000 allocated to each Fund
in proportion to the respective net assets of the Funds.
4. Federal Income Taxes.
It is the policy of the Funds to distribute all of their taxable income within
the prescribed time and otherwise comply with the provisions of the Internal
Revenue Code applicable to regulated investment companies. Therefore, no Fed-
eral income tax provision is required.
International Equity and Emerging Markets utilized $103,200 and $261,255, re-
spectively, of capital loss carryovers during the fiscal year ended March 31,
1998.
At March 31, 1998, Emerging Markets had a capital loss carryover amounting to
$25,743 which will expire on March 31, 2005 and a post October loss deferral
amounting to $2,423,421. To the extent that these losses are used to offset
any future capital gains realized during the carryover period, no capital
gains tax liabilities will be incurred by Emerging Markets for gains realized
and not distributed.
5. Purchases and Sales.
During the year ended March 31, 1998, purchases of investment securities other
than U.S. Government obligations and short-term investments, for Small Cap,
Mid Cap, Growth and
- --------------------------------------------------------------------------------
31
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
NOTES TO FINANCIAL STATEMENTS--Continued
Income, International Equity and Emerging Markets were $93,201,740,
$17,394,360, $41,721,679, $19,436,601, and $5,677,003 respectively. Sales of
such securities for the Funds were $106,216,004, $15,053,824, $39,983,114,
$18,621,988, and $5,124,054 respectively. Purchases and sales of U.S. Govern-
ment obligations were $5,294,577 and $5,300,000 respectively for Emerging Mar-
kets.
6. Securities Loans.
As of March 31, 1998, International Equity loaned common stocks having a value
of $4,024,948 and received cash collateral of $4,198,112 for these loans.
Security lending income of $19,447 collected by State Street and IFTC was re-
corded in interest income on the Statement of Operations.
7. Reclassifications.
For the year ended March 31, 1998, certain reclassification adjustments were
made between undistributed/ (overdistributed) net investment income, accumu-
lated net realized gain/(loss), and shares of beneficial interest due to dif-
ferences between book and tax accounting, primarily due to current year net
operating losses for Small Cap, Mid Cap, Emerging Markets; passive foreign in-
vestment company holdings for International Equity and Emerging Markets; and
foreign currency translation for International Equity and Emerging Markets.
Such reclassifications were as follows:
<TABLE>
<CAPTION>
Increase/(Decrease)
Increase/(Decrease) Undistributed/ Increase/(Decrease)
Shares of (Overdistributed) Accumulated
Beneficial Net Investment Net Realized
Interest Income/(Loss) Gain/(Loss)
<S> <C> <C> <C>
Small Cap 1,266,089 918,516 (2,184,605)
Mid Cap 20 50,624 (50,644)
International Equity (144) (455,912) 456,056
Emerging Markets (5,195) 71,973 (66,778)
</TABLE>
8. Contingent Liability.
The Trust insures itself and all Funds under a policy with ICI Mutual Insur-
ance Company. The annual premium is allocated among the Funds and Quantitative
Institutional Services. Additionally, the Funds have committed up to 300% of
the annual premium, one third of which was provided in cash, with each Fund's
pro rata portion recorded as an asset. The remainder is secured with an irrev-
ocable letter of credit.
9. Shares of Beneficial Interest.
The following schedule shows the number of shareholders each owning 5% or more
of a Fund and the total percentage of the Fund held by such shareholders.
<TABLE>
<CAPTION>
5% or Greater Shareholders
------------------------------
% of
Fund Number Fund Held
<S> <C> <C>
Small Cap Inst. 5 66%
Mid Cap Ord. 2 22%
Mid Cap Inst. 4 75%
Growth and Income Inst. 4 81%
International Equity Inst. 1 91%
Emerging Markets Inst. 2 97%
</TABLE>
10. Concentration of Risk.
The relatively large investments of Emerging Markets in Latin American and
Southeast Asian countries with limited or developing capital markets may in-
volve greater risks than investments in more developed markets and the prices
of such investments may be volatile. The consequences of political, social or
economic changes in these markets may have disruptive effects on the market
prices of the Fund's investments and the income they generate, as well as the
Fund's ability to repatriate such amounts.
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32
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
NOTES TO FINANCIAL STATEMENTS--Continued
11. Transactions in Shares of Beneficial Interest.
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
Year Ended Year Ended
March 31, 1998 March 31, 1997
---------------------- ------------------------
Shares Dollars Shares Dollars
<S> <C> <C> <C> <C>
SMALL CAP
ORDINARY SHARES:
Shares sold 356,461 $ 6,027,298 351,818 $ 6,317,030
Shares issued in
reinvestment of
distributions 550,052 8,762,319 924,424 16,907,849
Shares redeemed (947,877) (15,988,184) (1,264,403) (22,735,475)
-------- ------------ ---------- ------------
Net change (41,364) $ (1,198,567) 11,839 $ 489,404
-------- ------------ ---------- ------------
INSTITUTIONAL SHARES:
Shares sold 76,347 $ 1,343,153 321,340 $ 5,965,533
Shares issued in
reinvestment of
distributions 34,000 558,954 213,876 4,116,247
Shares redeemed (360,913) (6,164,447) (2,157,817) (38,785,621)
-------- ------------ ---------- ------------
Net change (250,566) $ (4,262,340) (1,622,601) $(28,703,841)
-------- ------------ ---------- ------------
TOTAL NET CHANGE FOR FUND $ (5,460,907) $(28,214,437)
------------ ------------
MID CAP
ORDINARY SHARES:
Shares sold 323,072 $ 4,936,609 283,463 $ 4,013,410
Shares issued in
reinvestment of
distributions 153,778 2,265,150 76,221 1,064,046
Shares redeemed (161,738) (2,497,310) (166,383) (2,323,633)
-------- ------------ ---------- ------------
Net change 315,112 $ 4,704,449 193,301 $ 2,753,823
-------- ------------ ---------- ------------
INSTITUTIONAL SHARES:
Shares sold 24,031 $ 362,791 96,506 $ 1,350,989
Shares issued in
reinvestment of
distributions 8,065 120,011 2,350 33,070
Shares redeemed (8,069) (125,877) (422,182) (6,069,111)
-------- ------------ ---------- ------------
Net change 24,027 $ 356,925 (323,326) $ (4,685,052)
-------- ------------ ---------- ------------
TOTAL NET CHANGE FOR FUND $ 5,061,374 $ (1,931,229)
------------ ------------
GROWTH AND INCOME
ORDINARY SHARES:
Shares sold 411,100 $ 7,998,681 138,045 $ 2,136,905
Shares issued in
reinvestment of
distributions 253,654 4,723,028 293,065 4,442,864
Shares redeemed (322,168) (6,086,768) (427,154) (6,602,373)
-------- ------------ ---------- ------------
Net change 342,586 $ 6,634,941 3,956 $ (22,604)
-------- ------------ ---------- ------------
INSTITUTIONAL SHARES:
Shares sold 85,691 $ 1,602,542 9,058 $ 137,464
Shares issued in
reinvestment of
distributions 10,834 201,396 17,093 258,962
Shares redeemed (18,462) (329,016) (55,068) (865,268)
-------- ------------ ---------- ------------
Net change 78,063 $ 1,474,922 (28,917) $ (468,842)
-------- ------------ ---------- ------------
TOTAL NET CHANGE FOR FUND $ 8,109,863 $ (491,446)
------------ ------------
</TABLE>
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33
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
NOTES TO FINANCIAL STATEMENTS--Continued
<TABLE>
<CAPTION>
Year Ended Year Ended
March 31, 1998 March 31, 1997
--------------------- ---------------------
Shares Dollars Shares Dollars
<S> <C> <C> <C> <C>
INTERNATIONAL EQUITY
ORDINARY SHARES:
Shares sold 465,824 $ 5,430,040 288,056 $ 3,128,420
Shares issued in reinvestment of
distributions 102,951 1,093,343 16,596 182,722
Shares redeemed (365,138) (4,141,960) (380,548) (4,118,431)
-------- ----------- -------- -----------
Net change 203,637 $ 2,381,423 (75,896) $ (807,289)
-------- ----------- -------- -----------
INSTITUTIONAL SHARES:
Shares sold 5,215 $ 55,388 46,087 $ 502,388
Shares issued in reinvestment of
distributions 7,592 80,395 1,099 12,144
Shares redeemed (26,843) (308,828) (4,216) (45,934)
-------- ----------- -------- -----------
Net change (14,036) $ (173,045) 42,970 $ 468,598
-------- ----------- -------- -----------
Total net change for fund $ 2,208,378 $ (338,691)
----------- -----------
EMERGING MARKETS
ORDINARY SHARES:
Shares sold 308,029 $ 2,634,998 269,187 $ 2,347,110
Shares issued in reinvestment of
distributions -- -- -- -
Shares redeemed (195,299) (1,708,550) (104,973) (898,041)
-------- ----------- -------- -----------
Net change 112,730 $ 926,448 164,214 $ 1,449,069
-------- ----------- -------- -----------
INSTITUTIONAL SHARES:
Shares sold 2,349 $ 17,973 131,870 $ 1,140,389
Shares issued in reinvestment of
distributions -- -- 14 116
Shares redeemed (4,047) (28,360) (1,132) (10,110)
-------- ----------- -------- -----------
Net change (1,698) $ (10,387) 130,752 $ 1,130,395
-------- ----------- -------- -----------
NET CHANGE FOR FUND $ 916,061 $ 2,579,464
----------- -----------
</TABLE>
12. Subsequent Events.
In April 1998, the Board of Trustees approved a proposal to change the names
of certain of the Funds as follows: Quantitative Numeric Fund to Quantitative
Small Cap Fund, Quantitative Numeric II Fund to Quantitative Mid Cap Fund, and
Quantitative Foreign Frontier Fund to Quantitative Emerging Markets Fund.
Tax Information Notice (unaudited).
For the fiscal year ended March 31, 1998, the Quantitative Small Cap Fund dis-
tributed $1,769,788 of long term capital gain dividends (28% gain).
- --------------------------------------------------------------------------------
34
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Trustees of Quantitative Group of Funds
In our opinion, the accompanying statements of assets and liabilities, includ-
ing the portfolios of investments, and the related statements of operations
and of changes in net assets and the financial highlights present fairly, in
all material respects, the financial position of Quantitative Small Cap Fund
(formerly Quantitative Numeric Fund), Quantitative Mid Cap Fund (formerly
Quantitative Numeric II Fund), Quantitative Growth and Income Fund, Quantita-
tive International Equity Fund and Quantitative Emerging Markets Fund (for-
merly Quantitative Foreign Frontier Fund) hereafter referred to as the
"Funds") at March 31, 1998, the results of each of their operations, the
changes in each of their net assets and the financial highlights for each of
the periods indicated, in conformity with generally accepted accounting prin-
ciples. These financial statements and financial highlights (hereafter re-
ferred to as "financial statements") are the responsibility of the Funds' man-
agement; our responsibility is to express an opinion on these financial state-
ments based on our audits. We conducted our audits of these financial state-
ments in accordance with generally accepted auditing standards which require
that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and dis-
closures in the financial statements, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall fi-
nancial statement presentation. We believe that our audits, which included
confirmation of securities at March 31, 1998 by correspondence with the custo-
dian and brokers and the application of alternative auditing procedures where
confirmations from brokers were not received, provide a reasonable basis for
the opinion expressed above.
PRICE WATERHOUSE LLP
Boston, MA
May 5, 1998
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35
<PAGE>
[LOGO OF QUANTITATIVE GROUP OF FUNDS APPEARS HERE]
QUANTITATIVE
GROUP of FUNDS
55 Old Bedford Road
Lincoln, MA 01773
voice 800/331-1244
fax 781/259-1166
www.quantfunds.com
