<PAGE>
QUANTITATIVE GROUP of FUNDS
SEMI-ANNUAL
REPORT
SEPTEMBER 30, 1998
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
Quantitative Foreign Value Fund
<PAGE>
[LETTERHEAD OF QUANTITATIVE GROUP of FUNDS]
________________________________________________________________________________
November 27, 1998
Dear Fellow Shareholder:
I am pleased to provide you with the Semi-Annual Report of the Quantitative
Group of Funds. During the six month period from April through the end of
September 1998, your funds performed remarkably well under difficult conditions.
The majority of the funds outperformed their peer averages, in some cases by
substantial margins. While the absolute returns of our funds did not compare to
last year at this time, the disciplined investment approaches followed by our
managers helped to minimize losses in a time of significant market correction.
The performance of the Funds and the market in general over the period can
be divided into two distinct segments. From April through June, investor concern
over the economic troubles in Asia and decreasing earnings forecasts in the U.S.
began to drive the market down. Investors began to accelerate their flight to
the perceived "quality" and liquidity of larger companies. As a result, returns
of mid and small cap companies suffered while the U.S. large company market
continued to post gains. On the international front, the developed markets had
modest gains, while the emerging markets, driven mainly by continued troubles in
the Asian markets, saw substantial losses.
From July through September, the markets decreased further as a number of
events continued to erode investor confidence. Overseas, there were increasing
questions about Japan's abilities to solve its financial problems, while
Malaysia took the drastic step of limiting repatriation of investments. In the
U.S., the emerging difficulties of the hedge funds drove down the prices of
financial stocks. Investors were concerned that banks would have to write off
loans made to the hedge funds. The resulting turmoil depressed other stocks as
well, as investors anticipated the hedge funds dumping their holdings on the
market. Once again, large cap stocks held their value best in the declining
market, although they still suffered a significant retrenchment.
Stock prices began rising again in September, as efforts to stabilize the
hedge funds began to be implemented. This trend has continued through the
present time, with the Dow recently reaching its highest point since late July.
The third quarter decline has left valuations for the asset classes very
attractive relative to projected earnings, creating significant opportunities
for future investment.
Finally, I wanted 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): "We feel better about the relative attractiveness of (small cap stocks)
than we have in some time. When small stocks have reached such extremely low
valuations in the past, they have consistently outperformed larger stocks over
the next twelve months."
<PAGE>
FORMERLY NUMERIC FUND
QUANTITATIVE SMALL CAP FUND
- --------------------------------------------------------------------------------
All Data as of September 30, 1998
INVESTMENT PROFILE
INVESTMENT COMMENTARY
Q From April 1 through September 30, the Fund had a return of -24.44%, ahead of
the -24.75% return for the average small cap fund and slightly trailing the
- -23.87% return for the Russell 2000 Index. The Fund's relative performance was
driven by strong technology and health care stock selection.
Q Individual technology stock selection substandially contributed to the Fund's
returns. Performance was led by Xircom, a notebook modem card manufacturer which
nearly doubled after the introduction of a new product. Rational Software (an
enterprise software tools company) and Jack Henry Associates (a software
services company which has focused on Y2K issues for banks) were also superior
performers. By contrast, the technology sector as a whole was one of the worst
performing sectors for the six month period. During the period we nearly doubled
our weight in technology and lowered our weight in capital goods and energy as
the models identified solid technology companies.
Q During the period, investors continued to move to larger stocks, which they
perceived as safer in a time of economic uncertainty. As a result, returns for
mid cap companies were primarily concentrated in the largest companies in the
index. This contributed to the Fund's slight underperformance relative to the
index. The Fund tends to maintain equally weighted positions, and accordingly,
each holding in the Fund has roughly the same effect on returns. The Russell
2000 is calculated using cap-weighted returns, thus the larger companies had a
greater effect on the index's returns.
Q We believe that small cap stocks are poised for a significant rebound. Since
the inception of the Russell 2000 index, every major decline (in excess of 20%)
has been followed by a period of substantial absolute performance. Small cap
stocks in general are cheaply priced, with the median company in the Russell
2000 selling at just over 12 times earnings.
Q The portfolio continues to be well diversified by sector and security and has
favorable value to growth characteristics. We feel stronger about the relative
attractiveness of this asset class than we have in some time.
<TABLE>
<CAPTION>
PERFORMANCE UPDATE Six Months Year To Date One Year Five Years Since Inception
<S> <C> <C> <C> <C> <C>
[_____] QUANTITATIVE SMALL CAP -24.44% -15.57% -23.14% 8.98% 16.63% (8/3/92)
[_____] Russell 2000 Index -23.87% -16.21% -19.02% 9.10% 12.32%
Lipper Small Cap Funds Average -24.75% -16.54% -20.58% 9.63%
CALENDAR YEAR PERFORMANCE ORDINARY SHARES FUND INFORMATION
[GRAPH APPEARS HERE] TICKER SYMBOL USBNX (ordinary)
QBNAX (institutional)
NUMBER OF COMPANIES 70
AVERAGE MARKET CAP $560 million
PRICE TO BOOK 2.9
PRICE TO EARNINGS 17.2
ASSETS UNDER MANAGEMENT $51 million
For more information, contact QUANTITATIVE GROUP of FUNDS at
1-800-331-1244 or www.quantfunds.com
</TABLE>
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
performance of ordinary shares of the Fund, which carry a 12b-1 fee of .10bp,
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 -22.37%,
9.20%, and 16.82%, for the one year, five year, and inception periods,
respectively. Similarly, the Calendar Year Performance chart does not reflect
the effects of the redemption fee. Institutional Shares of the Fund are
available to clients of financial advisors without a 12b-1 fee or sales charge.
The one year, five years, and since inception (1/6/93) returns for Institutional
Shares are -21.97%, 9.75% and 13.68% respectively. Share prices will vary and
shares may be worth more or less than their original cost at the time of the
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
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INVESTMENT PROFILE All Data as of September 30, 1998
[PHOTO APPEARS HERE]
ROBERT VON PENTZ
THE QUANTITATIVE SMALL CAP 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, fly fishing and gardening.
TOP TEN HOLDINGS (Each generally no more than 2-3% of the Fund.)
CURATIVE HEALTH SERVICES INC. RATIONAL SOFTWARE CORP.
EARTHGRAINS CO. REYNOLDS & REYNOLDS
ENTERTAINMENT PROPERTIES TR. SAFESKIN CORP.
FREMONT GENERAL CORP. STERIS CORP.
HENRY (JACK) & ASSOCIATES XIRCOM INC.
SECTOR ALLOCATION
[PIE CHART APPEARS HERE]
Consumer Staples 6%
Financials 17%
Technology 21%
Energy 2%
Cash 2%
Basic Materials 2%
Utilities 6%
Health Care 18%
Consumer Cyclicals 19%
Capital Goods 6%
<PAGE>
QUANTITATIVE MID CAP FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of September 30, 1998
INVESTMENT COMMENTARY
Q From April 1 through September 30, the Fund had a return of -16.51%, leading
the average mid cap fund (-19.30%) and slightly trailing its S&P 400 Index at -
16.30%. The Fund's weighting in technology and health care stocks, stock
selection in the technology and finance sectors, and investments in larger mid
cap stocks, all contributed to the Fund's performance.
Q The Fund increased its exposure in the technology and health care sectors, two
of the best performing sectors during the period, adding companies that
demonstrated improving earnings fundamentals. The Fund decreased its exposure in
the consumer cyclical and energy sectors, two of the worst performing sectors
during the period. An underweight in electrical utilities, generally viewed by
investors as a safe haven in bear markets, adversely effected the Fund's
relative performance.
Q Significant individual selections in the portfolio included Ingram Micro (a
distributor of computer equipment), CIENA Corp. (a telecom equipment company)
and Capital One Financial (a credit card company). Ingram Micro and Capital One
both have superb earnings prospects, and CIENA received a takeover bid from
Tellabs. In general, the value/growth characteristics of the portfolio remain
favorable with the price earnings ratio at 90% of the benchmark, while the
earnings growth rate is more than twice the benchmark.
Q Investors continued to focus their attention on larger stocks in response to
concerns about the global financial markets. As a result, returns for mid cap
companies were concentrated in the top 10% of the largest companies in the
index. This contributed to the Fund's underperformance relative to the index.
The Fund tends to maintain equally weighted positions, and accordingly, each
holding in the Fund has roughly the same effect on returns. The S&P 400 is
calculated using cap-weighted returns, thus the larger companies had a greater
effect on the index's returns.
Q The growth characteristics of mid size companies remain attractive, despite
some downward revision of earnings estimates in the recent economic climate.
The valuations of these companies also remain attractive, with the median
company in the S&P 400 selling at just over 13 times projected 1999 earnings. If
the earnings projections remains above recession level, the asset class should
remain quite promising for investments over the coming months.
<TABLE>
<CAPTION>
PERFORMANCE UPDATE Six Months Year To Date One Year Since Inception
<S> <C> <C> <C> <C>
[____] QUANTITATIVE MID CAP -16.51% -6.69% -10.65% 20.60% (3/21/95)
[____] S&P 400 Index -16.30% -7.08% -6.31% 18.04%
Lipper Mid Cap Funds Average -19.30% -9.57% -11.95%
</TABLE>
CALENDAR YEAR PERFORMANCE ORDINARY SHARES
[GRAPH APPEARS HERE]
FUND INFORMATION
TICKER SYMBOL QNIIX (ordinary)
QNIAX (institutional)
NUMBER OF COMPANIES 50
AVERAGE MARKET CAP $2.5 billion
PRICE TO BOOK 2.7
PRICE TO EARNINGS 19.5
ASSETS UNDER MANAGEMENT $14 million
For more information, contact QUANTITATIVE GROUP of FUNDS at 1-800-331-1244 or
www.quantfunds.com
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 & Poor's 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 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
performance of ordinary shares of the Fund, which carry a 12b-1 fee of .25bp.
Institutional Shares of the Fund are available to clients of financial advisors
without a 12b-1 fee. The one year and since inception (4/17/95) returns for
Institutional Shares are -10.48% and 20.24% respectively. Share prices will vary
and shares may be worth more or less that their original cost at the time of the
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>
FORMERLY NUMERIC II FUND
QUANTITATIVE MID CAP FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of September 30, 1998
[PHOTO APPEARS HERE]
ROBERT VON PENTZ
THE QUANTITATIVE MID CAP FUND 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 if 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, fly fishing and gardening.
TOP TEN HOLDINGS (Each generally no more than 2-9% of the Fund.)
CITRIX SYSTEMS INC. RATIONAL SOFTWARE CORP.
COMPUWARE CORP. SOUTHWEST AIRLINES
FLOWERS INDUSTRIES INC. TANDY CORP.
INGRAM MICRO INC. UNITED RENTALS INC.
QWEST COMMUNICATIONS INTL. INC. WATSON PHARMACEUTICALS INC.
SECTOR ALLOCATION
[PIE CHART APPEARS HERE]
Utilities 9%
Capital Goods 10% Technology 20%
Consumer Staples 9%
Financials 17%
Basic Materials 3%
Cash 1%
Consumer Cyclicals 19% Energy 1%
Health Care 11%
<PAGE>
QUANTITATIVE GROWTH & INCOME
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of September 30, 1998
INVESTMENT COMMENTARY
Q From April 1 through September 30, the Fund had a return of -6.81%, ahead
of both the -12.23% return for the average large cap fund and -6.98% return for
the S&P 500 Index. The Fund's sector weightings proved fruitful in specific
areas. The Fund's portfolio was restructured in June to overweight those
industries that the Fund's model anticipated would perform the best over the
next six months and underweighting the lowest ranked industries. Since June, six
of our top ten industries have performed in line with our expectations while
four have suffered. Health Care, Household Products, and Retail Drug Stores fall
into the winner category while Oil and Gas Drilling, Foods and Aerospace/Defense
have suffered. The Fund's September run of the model has identified four new
industries. As a result, the Fund will be incorporating Retail Apparel,
Diversified Financials, Home Furnishings and Appliances and Homebuilding stocks
into the portfolio.
Q Many of the technology stocks in the portfolio that were particularly hard
hit, such as Dell Computer, Compuware, Microsoft and Cisco System have bounced
back and handily outperformed the S&P 500 year to date. This supports the Fund's
decision to continue holding these issues through the downturn, which was based
on the model's favorable outlook for the sector and the individual stocks.
Financial stocks also hurt the Fund's performance as loans to hedge funds took
their toll on quarterly earnings. The Fund's largest exposure here included
BankAmerica and Bankers Trust. We will monitor these positions in the coming
weeks to determine if continuing ownership is warranted.
Q Looking forward our models are indicating a health return for the S&P 500
over the next twelve months. This forecast is based primarily on the current
interest rate environment and its effect on the economy. We are confident that
the Federal Reserve under Chairman Greenspan has formulated a well mapped out
plan which when executed will preserve the economic expansion that the U.S
economy has enjoyed over the past several years. We do however caution investors
that in our view, the markets for the foreseeable future will continue to be
volatile.
<TABLE>
<CAPTION>
PERFORMANCE UPDATE Six Months Year to Date One Year Five Years Ten Years Since Inception
<S> <C> <C> <C> <C> <C> <C>
[__] QUANTITATIVE GROWTH & INCOME -6.81% 5.25% 1.99% 17.17% 16.45% 5.79% (5/9/85)
[__] S&P 500 Index -6.98% 6.00% 9.05% 19.91% 17.29% 17.11%
Lipper Growth & Income Average -12.23% -2.56% -1.08% 15.22% 14.19%
</TABLE>
CALENDAR YEAR PERFORMANCE ORDINARY SHARES
[GRAPH APPEARS HERE]
FUND INFORMATION
TICKER SYMBOL USBOX (ordinary)
QGIAX (institutional)
NUMBER OF COMPANIES 101
AVERAGE MARKET CAP $43.7 billion
PRICE TO BOOK 4.0
PRICE TO EARNINGS 18.0
ASSETS UNDER MANAGEMENT $64 million
For more information, contact QUANTITATIVE GROUP of FUNDS at 1-800-331-1244 or
www.quantfunds.com
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 objectives, adjusted for
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
performance 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 3.03%,
17.41%, 16.56% and 15.87%, for the one year, five year, ten year and inception
periods, respectively. Similarly, the Calendar Year Performance chart does not
reflect 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 3.58%, 17.99% and 16.04% 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 to an investment will
fluctuate. The Fund's portfolio is subject to change, Distributed by U.S. Boston
Capital Corporation.
<PAGE>
QUANTITATIVE GROWTH & INCOME
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INVESTMENT PROFILE All Data as of September 30, 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 1,000 companies. Stocks within the portfolio are chosen based on
rankings produced by a multifactor quantitative model. Revisions to a company's
earning 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 Douglas T.
Holmes, CFA, Steven M. Esielonis and Charles Babin, CFA.
TOP TEN HOLDINGS (Each generally no more than 2-3% of the Fund.)
[PIE CHART APPEARS HERE]
ALLERGAN INC. DAYTON HUDSON CORP.
AT&T CORP. DELL COMPUTER CORP.
CHRYSLER CORP. GENERAL ELECTRIC CO.
COMPAQ COMPUTER CORP. HOME DEPOT INC.
COMPUWARE CORP. SCHERING PLOUGH CORP.
SECTOR ALLOCATION
Financials 20% Consumer Staples 6%
Utilities 1% Basic Materials 1%
Capital Goods 5%
Communication Services 5%
Energy 5% Technology 30%
Consumer Cyclicals 13% Health Care 15%
<PAGE>
QUANTITATIVE INTERNATIONAL EQUITY
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INVESTMENT PROFILE All Data as of September 30, 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, Australasia 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 David A. Umstead, Ph.D., CFA and Norman H. Meltz.
TOP TEN HOLDINGS (Each generally no more than 2-3% of the Fund.)
ANGLIAN WATER IRISH LIFE
BAYER HYPO-VEREINS NOKIA
CHUGAL PHARM. TOKYO ELEC. POWER
EDP ELECTRICIDADE UNITED UTILITIES
MONDA MOTOR UPM-KYMMENE
COUNTRY ALLOCATION
[PIE CHART APPEARS HERE]
Austria 4% Portugal 4%
France 4% Sweden 4%
Netherlands 9%
United Kingdom 12%
Others* 12%
(3% or less)
Cash 2%
Japan 24% Ireland 8%
Finland 8%
Germany 4%
Switzerland 8%
<PAGE>
QUANTITATIVE INTERNATIONAL EQUITY
- --------------------------------------------------------------------------------
INVESTMENT PROFILE
INVESTMENT COMMENTARY
Q From April 1 through September 30, the Fund had a return of -18.38% trailing
the -15.56% return for the average developed markets fund and the-13.31% return
for the Morgan Stanley EAFE Index. Performance attribution for the period shows
that the Fund's under-performance versus the EAFE Index over the past 6 months
resulted from its country allocation, its industry allocation and its under-
exposure to the largest capitalization stocks which were the least hurt in the
"flight to quality" phenomena. Each of these three factors contributed about the
same to the performance shortfall.
Q The Fund's country allocations fell on both sides of the performance spectrum.
Finland, one of the Fund's largest overweights, was one of only two European
countries with positive returns for the period. By contrast, Norway, another
overweight, was the worst performing European country due to continued weakness
in oil prices.
Q Along the industry dimension, the Fund's overweights in banks and, more
broadly, in the financial sector, produced a negative impact on performance.
Many of the banks in the portfolio are larger, global banks. These are the types
of institutions that were particularly affected by the multiple crises in Asia,
Russia, and Latin America, as well as hedge fund exposure.
Q Foreign currency exposure helped the Fund's total return over the 6 months. In
total, currency returns added about 3% to the returns the Fund achieved in local
terms. All the European currencies the Fund held by investing in European stocks
increased in value versus the U.S. dollar. Most European currencies gained more
than 10%. On the other side of the world, all the currencies in the Pacific
region lost value over the period. The Japanese yen, the Fund's largest currency
exposure in the Pacific region fell 2%. Other Pacific currencies fell more with
Australia the worst, declining 11%. As we have seen this 6 months, equity
markets around the world have all felt the effects of the Asian crisis that
began last year. The financial sector has been particularly hard hit. Looking
ahead, we think Japan's efforts to address its banking problems will help
equities in the Pacific region and reduce pressure on European equities as well.
We expect slow growth, on average, over the next past 6 months around the world.
We are confident that the worst is behind us and expect positive equity market
returns from foreign countries.
<TABLE>
<CAPTION>
PERFORMANCE UPDATE Six months Year to Date One Year Five Years Ten Years Since Inception
<S> <C> <C> <C> <C> <C> <C>
[_] QUANTITATIVE INTERNATIONAL EQUITY -18.38% -6.24% -18.62% 2.36% 2.65% 2.27% (7/31/87)
[_] MSCI EAFE Index -13.31% -0.55% -8.34% 5.35% 5.10% 5.71%
Lipper International Funds Average -15.56% -3.17% -10.66% 6.61% 8.79%
CALENDAR YEAR PERFORMANCE ORDINARY SHARES FUND INFORMATION
[GRAPH APPEARS HERE] TICKER SYMBOL USBFX (ordinary)
QIEAX (institutional)
NUMBER OF COMPANIES 93
AVERAGE MARKET CAP $17.5 BILLION
PRICE TO BOOK 2.5
PRICE TO EARNINGS 15.7
ASSETS UNDER MANAGEMENT $24 MILLION
For more information, contact QUANTITATIVE GROUP of FUNDS at 1-800-331-1244
or www.quantfunds.com
</TABLE>
The Morgan Stanley Capital International Europe, Australasia, and Far East
("EAFE") Index is an unmanaged index comprised of stocks located 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 Average 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 distribution.
Past Performance is no guarantee of future results. This information may be used
only when preceded or accompanied by a prospectus. Returns reflect the
performance 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 -17.80%,
2.56%, 2.76%, and 2.36%, for the one year, five year, ten year, and inception
periods, respectively. Similarly, the Calendar Year Performance chart does not
reflect 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 -
17.31% and -0.77% respectively. Share prices will vary and shares may be worth
more or less than their original cost at the time of the 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>
Formerly Foreign Frontier
QUANTITATIVE EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of September 30, 1998
THE QUANTITATIVE EMERGING MARKETS 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.)
ALPHA CREDIT BANK OTE
BANCO COMERCIAL PORTUGUESE PTT EXPLORATION & PRODUCTION
ELECTRICITY GENERATING TELEFONICA DE ARGENTINA
MSCI TAIWAN OPAL B TELEFONICA DEL PERU
NATL. BANK OF GREECE TELEFONOS DE MEXICO
[PIE CHART APPEARS HERE]
COUNTRY ALLOCATION ???????
Cash 5% South Africa 5%
Brazil 6% Others* 7%
Mexico 8% China 4%
Thailand 5% Greece 13%
Turkey 5%
Taiwan 8% Argentina 7%
Chile 5%
Portugal 10%
India 7%
Peru 5%
<PAGE>
Formerly Foreign Frontier
QUANTITATIVE EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of September 30, 1998
INVESTMENT COMMENTARY
Q In the past six months of turmoil in world equity markets, the Fund (-28.75%)
has held up well by significantly outperforming the MSEMF index (-40.42%) and
the average emerging markets fund (-38.63%) significantly. Both country
allocation and stock selection contributed to the Fund's superior returns. The
Fund held a more equally distributed set of country exposures than the index,
providing greater diversification, and the resulting underweights in the large
markets of Brazil, South Africa, and Mexico were beneficial. Stock selection in
the majority of our countries outperformed the local indexes due to a
combination of more successful fundamentals and better value.
Q The Fund has employed a stock selection strategy based upon research
indicating that a higher return may accrue over time to higher value securities
where earnings fundamentals are improving. The strategy involves selecting
stocks having higher value relative to forecast earnings, growth, and asset
values within each market. Some of the main contributors to performance this
year were Bank Itau in Brazil and Credit Bank in Greece which have high growth
in deposits, and opportunities to purchase newly privatized state owned banks.
Anglo American, the largest mining and finance company in South Africa, and
Dogan Holding, a multi-industry stock in tourism and insurance in Turkey also
enhanced the Fund by outperforming their country indexes.
Q September was truly a breath of fresh air for equity markets, and reflected
the likely rebound in emerging markets we foresee beginning over the next year.
Most countries have made positive steps to reduce debt, restructure the banking
industry, privatize state owned companies, create more transparent accounting
standards, and reduce restrictions on foreign investment. These countries
warrant reconsideration of their relative attractiveness. We expect to gradually
increase the Fund's allocation in Asian markets as their restructuring
progresses. Since forecasts for developed markets have retreated to more
realistic levels, emerging markets now offer forecasted earnings growth in line
with developed markets, but at only half the price.
<TABLE>
<CAPTION>
PERFORMANCE UPDATE Six Months Year to Date One Year Since Inception
<S> <C> <C> <C> <C>
[___] QUANTITATIVE EMERGING MARKETS -28.57% -28.29% -41.26% -13.40% (10/3/94
[___] Morgan Stanley EMG Index -40.42% -36.72% -47.81% -17.02%
Lipper Emerging Mkts Funds Average -38.63% -35.59% -46.46%
</TABLE>
CALENDAR YEAR PERFORMANCE ORDINARY SHARES
[GRAPH APPEARS HERE]
FUND INFORMATION
TICKER SYMBOL QFFOX (ordinary)
QEMAX (institutional)
NUMBER OF COMPANIES 146
ASSETS UNDER MANAGEMENT $8 million
For more information, contact QUANTITATIVE GROUP of FUNDS at 1-800-331-1244 or
www.quantfunds.com
The Morgan Stanley Capital International Emerging Markets Global ("EMG") Index
is an unmanaged index comprised of stocks located in countries other than the
United States. It is widely recognized as representative 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
performance 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 4% redemption fee for ordinary shares, the returns would have been -40.67%,
and-13.18%, for the one year and inception periods, respectively. Similarly, the
Calendar Year Performance chart does not reflect 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 -40.17 and -15.48 respectively. Share
prices will vary and shares may be worth more or less than their original cost
at the time of the 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 FOREIGN VALUE FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of September 30, 1998
THE QUANTITATIVE FOREIGN VALUE FUND, provides Investors with the opportunity to
participate in the growth potential of companies predominantly located in
developed foreign countries. Importantly, the returns of the developed foreign
markets historically have not been highly correlated to those of the United
States' stock markets, as represented by broadbased stock indices. Thus, adding
the Fund to your portfolio may provide a measure of diversification that can
reduce your overall investment 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 will generally own stocks of 25-40 non-U.S.
companies located in the twenty-one countries comprising the Morgan Stanley
Europe, Australasia and Far East (EAFE) Index. In addition, the Fund also may
invest a portion of its assets in emerging markets, such as Mexico and Thailand.
This diversification within the Fund, coupled with the fact that the operation
of the Fund's investment model will generally lead the Fund to be invested in 10
or more countries, reduces the likelihood that negative performance of a single
country will significantly impact the Fund's return.
BUY AND SELL DISCIPLINE. The investment process for the Quantitative Foreign
Value Fund combines both quantitative and fundamental techniques. The Fund's
approach is primarily "bottom up", searching for individual stocks with strong,
undervalued cash flows, regardless of location or industry. The Fund uses
proprietary computer models to rank countries and industries on the basis of
value and to narrow a universe of 12,000 down to 300 to 500 deserving of further
consideration. Recognizing the difficulty of getting complete information about
companies in some foreign markets, the Fund supplements the screening process by
performing in-depth financial and fundamental analysis including communications
with the management of prospective investments prior to investing.
MANAGEMENT. The Fund is managed by Bernard R. Horn, Jr., President of Polaris
Capital Management, Inc., a Boston, Massachusetts based money manager that
specializes in the management of international equity portfolios. Mr. Horn
brings nearly 20 years of international investment experience to the Fund.
TOP TEN HOLDINGS (Each generally no more than 3-4% of the Fund.)
ARISAWA MFG. CO. SAPPL
FUTABA INDUSTRIAL TAKEFUJI CORP.
METHANEX CORP. TOYOTA MOTOR CORP.
NEPTUNE MARITIME OY. UNION ELEC. FENOSA
RHI AG. VTECH HLDGS
COUNTRY ALLOCATION ???????????
[PIE CHART APPEARS HERE]
Canada 3%
Cash 10% Finland 8%
Other Europe* 17% Germany 10%
Hong Kong 5%
Thailand 2%
Mexico 3%
Sweden 4% Japan 19%
Spain 6%
South Africa 6% Netherlands 7%
<PAGE>
QUANTITATIVE FOREIGN VALUE FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of September 30, 1998
INVESTMENT COMMENTARY
Q The Fund began fully implementing its investment strategy on July 1. For the
period from July 1 to September 30, the Fund had a return of -18.00%, trailing
the -14.22% return for the Morgan Stanley EAFE Index and the -16.16% return for
the average developed markets fund. The Fund was adversely effected by general
market conditions in the period. The Fund's 19% weighting in Japan, and
positions in Spain and Hong Kong performed well. Declines in the remainder of
the portfolio offset this stronger performance. The Fund focused away from
sectors in the market that performed exceptionally well in the first six months
of 1998 because the valuations of those companies had increased to levels beyond
where they valued by the Fund's investment model. European equity markets fit
this profile. Asian markets, while attractive on a value basis, were not
acceptable due to the financial and economic risks associated with these
markets.
Q The best performing stock for the quarter was Vtech, the Hong Kong maker of
portable phones and electronic learning toys for preschoolers. Union Fenosa, the
large Spanish utility, responded well to a strong Spanish economy, lower
interest rates, and favorable regulatory developments. Other solid performers
included the Fund's Japanese holdings (19% of the portfolio), the Dutch printer
Roto Smeets de Boer, and Italian energy company ENI.
Q The largest declines in the portfolio occurred in oil, cyclical, and banking
companies. Lukoil, the Russian oil company, declined sharply, due to the decline
in the value of the Russian ruble. Although Lukoil continues to make progress in
its transformation, the political turmoil within Russia overwhelmed the value in
its oil reserves. Weak oil prices due to slower economic growth also affected
the other oil producing company in the portfolio -- Norsk Hydro. Both stocks
were sold during the quarter since we believed that recent large oil discoveries
will keep oil prices down in a world where demand is falling.
Q The extreme market volatility has created strong opportunities for the Fund's
value strategy. The Fund's investment process currently includes a fresh list of
excellent long-term investments. The Fund's current strategy is to modify its
holdings of European equities. European equities, which were up 40% to 50% at
mid year, are now flat to down. Consequently, the Fund is retaining some
European positions and adding others that have fallen to very attractive levels.
We have a cautious stance on Asia due to financial risk in many companies there.
However, some of the best values in the world exist in Asia at this time, and we
will continue to cautiously pursue investment opportunities there.
<TABLE>
<CAPTION>
PERFORMANCE UPDATE Three Months Since Inception
<S> <C> <C>
[____] QUANTITATIVE FOREIGN VALUE -18.00% -18.00% (7/1/98)
[____] MSCI EAFE Index -14.22% -14.22%
Lipper International Funds Average -16.16%
FUND INFORMATION
TICKER SYMBOL None
NUMBER OF COMPANIES 31
ASSETS UNDER MANAGEMENT $5 million
</TABLE>
For more information, contact QUANTITATIVE GROUP
of FUNDS at 1-800-331-1244 or www.quantfunds.com
The Morgan Stanley Capital International Europe, Australasia, and Far East
("EAFE") Index is an unmanaged index comprised of stocks located 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. The information may be used
only when preceded or accompanied by a prospectus. Returns are for a limited
period of time and reflect the performance of ordinary shares of the Fund, which
carry a 12b-1 fee of .25bp, but exclude the effects of a 1% deferred sales
charge. The since inception return is not annualized. Institutional Shares may
be available to clients of some financial advisors without a 12b-1 fee of sales
charge. Share prices will vary and shares may be worth more or less than their
original cost at the time of the 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>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE SMALL CAP FUND
- --------------------------------------------------------------------------------
COMMON STOCK--98.4%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
AUTOMOBILES--1.6%
Avis Rent-A-Car Inc. (a) 38,565 $ 831,558
-----------
BANKS--2.8%
Independence Community Bank Corporation 57,765 812,320
PFF Bancorp Inc. (a) 40,885 623,496
-----------
1,435,816
-----------
BUSINESS SERVICES--5.1%
American Capital Strategies Limited 39,610 641,187
Complete Business Solutions Inc. (a) 32,755 941,706
Henry Jack and Associates Inc. 21,295 1,016,836
-----------
2,599,729
-----------
CHEMICALS--2.0%
Calgon Carbon Corporation 62,600 465,587
Mississippi Chemical Corporation 43,630 529,014
-----------
994,601
-----------
COMPUTERS & BUSINESS
EQUIPMENT--4.5%
American Management Systems Inc. (a) 32,630 893,246
Wang Laboratories Inc. (a) 16,745 324,434
Xircom Inc. (a) 43,325 1,061,463
-----------
2,279,143
-----------
DRUGS & HEALTH CARE--16.7%
Curative Health Services Inc. (a) 32,570 997,456
Monarch Dental Corporation (a) 65,600 865,100
NBTY Inc. (a) 34,645 272,829
Orthodontic Centers of America Inc. (a) 54,625 911,555
PathoGensis Corporation (a) 16,735 558,531
Priority Healthcare Corporation, Class B (a) 38,535 881,488
PSS World Medical Inc. (a) 45,895 849,058
Quorum Health Group Inc. (a) 29,765 483,681
Steris Corporation (a) 41,430 1,170,398
Sunrise Assisted Living Inc. (a) 22,865 784,555
Sybron International Corporation Wisconsin (a) 39,405 753,621
-----------
8,528,272
-----------
ELECTRICAL EQUIPMENT--6.0%
AFC Cable Systems Inc. (a) 25,450 604,437
Antec Corporation (a) 40,235 618,613
Cable Design Technologies Corporation (a) 39,305 501,139
Jabil Circuit Inc. (a) 14,700 510,825
Watsco Inc. (a) 55,607 834,105
-----------
3,069,119
-----------
ELECTRONICS--1.5%
Gentex Corporation (a) 51,470 772,050
-----------
FINANCIAL SERVICES--3.3%
ARM Financial Group Inc., Class A 51,855 920,426
Richmond County Financial Corporation 49,040 735,600
-----------
1,656,026
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
FOOD & BEVERAGES--5.5%
Earthgrains Company 35,940 $ 1,111,894
Flowers Industries Inc. 42,775 933,029
Ralcorp Hldgs Inc. (a) 54,345 760,830
-----------
2,805,753
-----------
HOUSEHOLD APPLIANCES &
FURNISHINGS--1.4%
Furniture Brands International Inc. (a) 35,630 694,785
-----------
INSURANCE--7.8%
Annuity and Life Reinsurance Holdings 13,205 260,799
Fremont General Corporation 21,005 1,008,240
Mutual Risk Management Ltd. 26,440 935,315
NAC Real Estate Corporation 19,120 941,660
Reliance Group Holdings Inc. 58,260 819,281
-----------
3,965,295
-----------
LEISURE TIME--1.7%
Championship Auto Racing Team (a) 34,965 854,457
-----------
LIQUOR--0.2%
Coors Adolph Company, Class B 2,165 99,387
-----------
MISCELLANEOUS--1.7%
United Rentals Inc. (a) 35,893 859,189
-----------
OFFICE FURNISHINGS & SUPPLIES--3.6%
Reynolds & Reynolds Company, Class A 60,850 1,083,891
United Stationers Inc. (a) 32,300 771,162
-----------
1,855,053
-----------
PETROLEUM SERVICES--1.5%
Friede Goldman International Inc. (a) 31,620 498,015
Veritas DGC Inc. (a) 14,910 248,811
-----------
746,826
-----------
POLLUTION CONTROL--1.6%
Allied Waste Industries Inc. (a) 15,430 360,676
MPW Industrial Services Group Inc. (a) 49,270 468,065
-----------
828,741
-----------
PUBLISHING--2.0%
Consolidated Graphics Inc. (a) 19,620 745,560
Mail-Well Holdings Inc. (a) 31,310 268,092
-----------
1,013,652
-----------
REAL ESTATE--7.7%
Boston Properties Inc. 29,295 834,908
Capital Automotive Real Estate Investment Trust 57,350 670,278
Entertainment Properties Trust 56,640 1,047,840
FelCor Lodging Trust Inc. 25,985 631,760
Intrawest Corporation 22,800 349,125
Suburban Lodges America Inc. (a) 60,095 401,885
-----------
3,935,796
-----------
</TABLE>
- --------------------------------------------------------------------------------
13
<PAGE>
[LOGO APPEARS HERE]
- -------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE SMALL CAP FUND--CONTINUED
- -------------------------------------------------------------------------------
COMMON STOCK--Continued
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
RETAIL TRADE--8.5%
BJ's Wholesale Club Inc. (a) 26,005 $ 955,684
Cash American International Inc. 41,680 463,690
Chico's Fashion Inc. (a) 10,020 161,573
Mens Wearhouse Inc. 34,727 599,041
Michaels Stores Inc. (a) 31,970 815,235
Oakley Inc. (a) 71,045 683,808
Sunglass Hut International Inc. (a) 116,630 670,623
-----------
4,349,654
-----------
SAVINGS AND LOAN--1.4%
Astoria Financial Corporation 16,930 713,176
-----------
SOFTWARE--8.4%
Hyperion Solutions Corporation (a) 21,380 463,679
Learning Company Inc. (a) 42,950 850,947
Rational Software Corporation (a) 64,585 1,085,835
Sterling Software Inc. (a) 33,710 929,132
Wind River Systems Inc. (a) 19,735 932,479
-----------
4,262,072
-----------
TIRES & RUBBER--1.9%
Safeskin Corporation (a) 31,390 990,747
-----------
TOTAL COMMON STOCK
(Cost $53,836,203) $50,140,897
===========
</TABLE>
SHORT TERM INVESTMENTS--1.6%
<TABLE>
<CAPTION>
Par Value Value
<S> <C> <C>
State Street Repo 4.000%, 10/01/98 (Cost $824,000)
(Dated 09/30/98), Collateralized by $610,000 U.S.
Treasury Bond 8.125%, 08/15/21, Market Value
$845,041, Repurchase Proceeds $824,092. $824,000 $ 824,000
-----------
TOTAL SHORT TERM INVESTMENTS
(Cost $824,000) $ 824,000
-----------
TOTAL INVESTMENTS--100%
(Cost $54,660,203) (b) $50,964,897
===========
</TABLE>
(a) Non-income producing Security.
(b) At September 30, 1998, the unrealized depreciation of investments based on
aggregate cost for federal tax purposes of $54,660,203 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $ 4,764,986
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (8,460,292)
-----------
Net unrealized depreciation $(3,695,306)
===========
</TABLE>
- -------------------------------------------------------------------------------
14
<PAGE>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE MID CAP FUND
- --------------------------------------------------------------------------------
COMMON STOCK--98.0%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
AEROSPACE--6.2%
Cordant Technologies Inc. 7,320 $ 309,728
Gulfstream Aerospace Corporation (a) 7,570 304,693
Sundstrand Corporation 5,335 247,411
-----------
861,832
-----------
AIR TRAVEL--2.6%
Southwest Airlines Company 18,307 366,140
-----------
APPAREL & TEXTILES--3.7%
Tommy Hilfiger Corporation (a) 5,210 213,610
Shaw Industries Inc. 18,850 306,312
-----------
519,922
-----------
AUTOMOBILES--2.1%
Lear Corporation (a) 6,585 288,094
-----------
BUILDING CONSTRUCTION--1.4%
McDermott J. Ray S.A. (a) 6,575 197,661
-----------
BUSINESS SERVICES--2.1%
Quintiles Transnational Corporation (a) 6,825 298,594
-----------
CHEMICALS--1.8%
Cabot Corporation 10,320 257,355
-----------
COMPUTERS & BUSINESS
EQUIPMENT--10.8%
Citrix Systems (a) 5,805 412,155
Ingram Micro Inc., Class A (a) 8,660 463,851
Seagate Technology (a) 11,530 288,971
Tandy Corporation 6,385 341,597
-----------
1,506,574
-----------
DRUGS & HEALTH CARE--8.0%
Allegiance Corporation 10,520 312,970
Quorum Health Group Inc. (a) 12,207 198,364
Total Renal Care Holdings (a) 11,416 273,984
Watson Pharmaceuticals Inc. (a) 6,715 340,786
-----------
1,126,104
-----------
ELECTRIC UTILITIES--2.1%
Montana Power Company 6,595 294,714
-----------
ELECTRONICS--2.1%
Micron Technology Inc. (a) 9,445 287,482
-----------
FINANCIAL SERVICES--1.0%
Capital One Financial Corporation 1,405 145,417
-----------
FOOD & BEVERAGES--6.4%
Dean Foods Company 6,280 276,320
Flowers Industries Inc. 15,360 335,040
Quaker Oats Company 4,925 290,575
-----------
901,935
-----------
FOREST PRODUCTS--1.4%
Georgia-Pacific Corporation 4,395 200,522
-----------
GAS & PIPELINE UTILITIES--2.0%
Washington Gas Light Company 10,160 281,305
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
INSURANCE--11.6%
ACE Limited 9,465 $ 283,950
CMAC Investment Corporation 5,130 223,155
Nationwide Financial Services Inc., Class A 7,140 324,424
Ohio Casualty Corporation 6,390 247,612
Old Republic International Corporation 10,462 235,395
Provident Companies Inc. 9,090 306,788
-----------
1,621,324
-----------
INVESTMENT COMPANIES--1.8%
T. Rowe Price & Associates Inc. 8,595 252,478
-----------
MISCELLANEOUS--3.5%
United Rentals Inc. (a) 14,360 343,742
Weatherford International Inc. 6,930 149,861
-----------
493,603
-----------
REAL ESTATE--1.8%
Crescent Real Estate Equities 9,650 243,662
-----------
RETAIL GROCERY--2.0%
Kroger Company 5,695 284,750
-----------
RETAIL TRADE--5.7%
Abercrombie & Fitch Company, Class A (a) 5,840 256,960
Barnes & Noble Inc. (a) 10,485 283,095
TJX Companies Inc. 14,200 252,938
-----------
792,993
-----------
SAVINGS AND LOAN--2.2%
Dime Bancorp Inc. 12,175 308,180
-----------
SOFTWARE--9.9%
Cadence Design Systems Inc. 5,470 139,827
Compuware Corporation (a) 6,960 409,770
Intuit Inc. (a) 5,265 245,152
Rational Software Corporation (a) 19,400 326,162
Solectron Corporation (a) 5,480 263,040
-----------
1,383,951
-----------
TELECOMMUNICATION SERVICES--4.8%
Qwest Communications Intl Inc. (a) 11,461 358,873
Valassis Communications Inc. (a) 7,930 317,200
-----------
676,073
-----------
TIRES & RUBBER--1.0%
Safeskin Corporation (a) 4,470 141,084
-----------
TOTAL COMMON STOCK
(Cost $13,547,181) $13,731,749
===========
</TABLE>
- -------------------------------------------------------------------------------
15
<PAGE>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE MID CAP FUND--CONTINUED
- --------------------------------------------------------------------------------
SHORT TERM INVESTMENTS--2.0%
<TABLE>
<CAPTION>
Par Value Value
<S> <C> <C>
State Street Repo 4.000%, 10/01/98 (Cost $275,000)
(Dated 09/30/98), Collateralized by $190,000 U.S.
Treasury Bond 13.750%, 08/15/04, Market Value
$282,417, Repurchase Proceeds $275,031. $275,000 $ 275,000
-----------
TOTAL SHORT TERM INVESTMENTS (Cost $275,000) $ 275,000
===========
TOTAL INVESTMENTS--100%
(Cost $13,822,181) (b) $14,006,749
===========
</TABLE>
(a) Non-income producing Security
(b) At September 30, 1998, the unrealized appreciation of investments based on
aggregate cost for federal tax purposes of $13,822,181 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $ 1,592,356
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (1,407,788)
-----------
Net unrealized appreciation $ 184,568
===========
</TABLE>
- --------------------------------------------------------------------------------
16
<PAGE>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE GROWTH AND INCOME FUND
- --------------------------------------------------------------------------------
COMMON STOCK--100.0%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
AEROSPACE--2.3%
General Dynamics Corporation 17,200 $ 863,225
Sundstrand Corporation 13,200 612,150
-----------
1,475,375
-----------
AIR TRAVEL--0.3%
Delta Air Lines Inc. Delaware 1,100 106,975
U.S. Airways Group Inc. (a) 1,900 96,187
-----------
203,162
-----------
AUTOMOBILES--4.2%
Chrysler Corporation 25,300 1,211,238
Ford Motor Company 23,100 1,084,256
Volkswagen A.G. (c) 25,000 360,485
-----------
2,655,979
-----------
BANKS--7.3%
AmSouth Bancorporation 9,675 330,159
BankAmerica Corporation 13,800 829,725
Bankers Trust NY Corporation 7,500 442,500
Charter One Financial Inc. 15,540 386,557
Comerica Inc. 13,800 756,413
First Chicago NBD Corporation 1,700 116,450
First Union Corporation 6,100 312,244
Fleet Financial Group Inc. 8,000 587,500
National City Corporation 1,200 79,125
PNC Bank Corporation 13,500 607,500
Republic New York Corporation 5,000 197,500
-----------
4,645,673
-----------
BROADCASTING--1.5%
Comcast Corporation, Class A 13,000 610,188
MediaOne Group Inc. (a) 7,100 315,506
-----------
925,694
-----------
BUSINESS SERVICES--1.2%
Comdisco, Inc. 40,700 554,537
Deluxe Corporation 4,100 116,594
IMS Health Inc. 1,800 111,488
-----------
782,619
-----------
COMPUTERS & BUSINESS
EQUIPMENT--16.0%
Apple Computer (a) 30,000 1,143,750
Cisco Systems Inc. (a) 17,100 1,056,994
Compaq Computer Corporation 47,500 1,502,188
Dell Computer Corporation (a) 56,000 3,682,000
Honeywell, Inc. 5,000 320,313
Pitney Bowes Inc. 13,200 693,825
Tech Data Corporation (a) 2,500 125,156
Unisys Corporation (a) 35,600 809,900
Xerox Corporation 9,900 839,025
-----------
10,173,151
-----------
CONSTRUCTION & MINING
EQUIPMENT--1.3%
Caterpillar Inc. 18,100 806,581
-----------
CONSTRUCTION MATERIALS--0.3%
USG Corporation 4,400 190,300
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
DOMESTIC OIL--1.1%
Amerada Hess Corporation 3,900 $ 224,981
Phillips Petroleum Company 10,100 455,763
-----------
680,744
-----------
DRUGS & HEALTH CARE--15.7%
Allegiance Corporation 23,600 702,100
Allergan, Inc. 21,500 1,255,063
Amgen Inc. (a) 6,000 453,375
Bausch & Lomb Inc. 2,400 94,500
Biogen Inc. (a) 9,200 605,475
Bristol-Myers Squibb Company 5,100 529,762
Merck & Company Inc. 2,700 349,819
PacifiCare Health Systems, Class B (a) 8,200 610,900
Pharmacia & Upjohn Inc. 22,800 1,144,275
Pfizer, Inc. 8,100 858,094
Schering-Plough Corporation 24,200 2,506,212
Warner-Lambert Company 11,200 845,600
-----------
9,955,175
-----------
ELECTRICAL EQUIPMENT--2.3%
General Electric Company 18,200 1,448,037
-----------
ELECTRONICS--4.6%
Intel Corporation 8,500 728,875
Lexmark International Group Inc. (a) 15,600 1,081,275
Lucent Technologies Inc. 7,688 530,952
SCI Systems Inc. (a) 12,900 347,494
Tellabs Inc. (a) 5,800 230,913
-----------
2,919,509
-----------
FINANCIAL SERVICES--1.4%
Countrywide Credit Industries Inc. 8,000 333,000
Federal National Mortgage Association 8,200 526,850
-----------
859,850
-----------
FOOD & BEVERAGES--3.9%
Flowers Industries Inc. 16,100 351,181
Heinz H.J. Company 14,000 715,750
Interstate Bakeries Corporation 24,300 753,300
McCormick & Company Inc. 15,100 438,844
Supervalu Inc. 10,000 233,125
-----------
2,492,200
-----------
GAS & PIPELINE UTILITIES--1.0%
Marketspan Corporation 11,264 323,136
National Fuel Gas Company (N.J.) 6,700 314,900
-----------
638,036
-----------
HOTELS & RESTAURANTS--0.9%
Tricon Global Restaurants Inc. (a) 14,900 581,100
-----------
HOUSEHOLD PRODUCTS--0.2%
Dial Corporation 5,200 107,250
-----------
INDUSTRIAL MACHINERY--0.7%
Parker-Hannifin Corporation 15,930 472,922
-----------
</TABLE>
- -------------------------------------------------------------------------------
17
<PAGE>
[LOGO APPEARS HERE]
- -------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE GROWTH AND INCOME FUND--CONTINUED
- -------------------------------------------------------------------------------
COMMON STOCK--Continued
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
INSURANCE--7.5%
Ambac Financial Group Inc. 6,200 $ 297,600
American General Corporation 12,700 811,212
CIGNA Corporation 12,900 853,013
Conseco Inc. 16,000 489,000
Everest Reinsurance Holdings 14,800 552,225
Fremont General Corporation 15,700 753,600
Lincoln National Corporation 8,100 666,225
Marsh & McLennan Companies Inc. 6,450 320,887
-----------
4,743,762
-----------
INTERNATIONAL OIL--4.0%
Amoco Corporation 6,400 344,800
Chevron Corporation 8,600 722,938
Exxon Corporation 3,500 245,656
Mobil Corporation 5,200 394,875
Texaco Inc. 13,500 846,281
-----------
2,554,550
-----------
INVESTMENT COMPANIES--0.6%
Bear Stearns Companies Inc. 12,762 394,824
-----------
MISCELLANEOUS--1.2%
General Instrument Corporation (a) 36,000 778,500
-----------
RETAIL TRADE--7.2%
Dayton Hudson Corporation 34,000 1,215,500
Federated Department Stores Inc. (a) 1,700 61,837
GAP Inc. 3,700 195,175
Home Depot Inc. 30,000 1,185,000
May Department Stores Company 10,400 535,600
Rite Aid Corporation 11,000 390,500
Sears, Roebuck & Company 3,600 159,075
TJX Companies Inc. 31,200 555,750
Tiffany & Company 9,300 291,788
-----------
4,590,225
-----------
SOFTWARE--7.3%
Autodesk, Inc. 19,500 511,875
Compuware Corporation (a) 35,300 2,078,287
Microsoft Corporation (a) 9,400 1,034,588
Oracle Corporation (a) 34,400 1,001,900
-----------
4,626,650
-----------
TELECOMMUNICATION SERVICES--0.5%
Northern Telecom Limited 9,360 299,520
-----------
TELEPHONE--4.6%
AT&T Corporation 26,700 1,560,281
Ameritech Corporation 18,900 895,388
U.S. West Inc. 8,593 450,595
-----------
2,906,264
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
TOBACCO--0.9%
UST Inc. 12,200 $ 360,662
Universal Corporation VA 5,800 207,350
-----------
568,012
-----------
TOTAL COMMON STOCK
(Cost $49,424,424) (b) $63,475,664
===========
</TABLE>
(a) Non-income producing Security
(b) At September 30, 1998, the unrealized appreciation of investments based on
aggregate cost for federal tax purposes of $49,424,424 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $17,703,595
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (3,652,355)
-----------
Net unrealized appreciation $14,051,240
===========
</TABLE>
(c) ADR--American Depository Receipt
- -------------------------------------------------------------------------------
18
<PAGE>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
COMMON STOCK--97.9%
<TABLE>
<CAPTION>
<S> <C> <C>
Australia National Industries 283,414 $ 124,273
Leighton Holdings 49,700 162,268
Orica Limited (b) 41,295 200,649
-----------
487,190
-----------
AUSTRIA--4.2%
Austria Mikros System (b) 3,020 115,022
Bank Austria AG 4,100 175,871
Bohler Uddeholm 10,300 447,083
OMV AG 3,150 282,333
-----------
1,020,309
-----------
BELGIUM--1.9%
Fortis AG 1,400 348,711
Petrofina SA 300 110,128
-----------
458,839
-----------
DENMARK--1.3%
Novo-Nordisk AS, Class B 2,550 307,181
-----------
FINLAND--7.7%
Nokia (AB) OY, Class A 15,000 1,191,858
Sampo, Class A 6,300 179,787
UPM-Kymmene OY 21,000 481,168
-----------
1,852,813
-----------
FRANCE--3.8%
Axa-Uap (b) 3,250 297,734
Cie Fin Paribas 2,700 145,612
Peugeot SA 750 131,042
Promodes 350 213,382
Suez Lyonnaise Des Eaux 704 119,922
-----------
907,692
-----------
GERMANY--4.2%
Bayerische Hypoth-Und Vereins 11,733 864,156
Deutsche Bank AG (b) 2,850 147,283
-----------
1,011,439
-----------
HONG KONG--0.1%
Wharf (Holdings) (warrants exp. 12/31/99) 22,650 430
-----------
IRELAND--8.0%
Allied Irish Banks 25,600 374,940
Clondalkin Group 26,900 178,835
CRH 33,200 419,267
Irish Life 67,600 500,090
Jurys Hotel Group 14,400 115,136
Kerry Group 19,200 223,816
Smurfit (Jefferson) 77,100 115,226
-----------
1,927,310
-----------
ITALY--1.3%
Burgo (Cartiere) Spa 54,600 306,301
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
JAPAN--21.2%
Acom Company 4,900 $ 263,285
Canon Inc. 16,000 347,130
Casio Computer Company (b) 58,000 369,811
Chugai Pharmaceutical Company 97,000 662,501
Dainippon Ink & Chemicals 57,000 122,907
Fuji Photo Film Company 6,000 211,575
Fujitsu (b) 14,000 120,933
Honda Motor Company 16,000 486,073
Kansai Electric Power Company (b) 7,000 120,676
Mitsubishi Corporation 45,000 217,415
Mitsui Mining & Sm 28,000 121,414
Orix Corporation 2,500 171,260
Sankyo Company 6,000 135,691
Sekisui House 31,000 251,667
Sony Corporation 6,000 433,109
Sumitomo Metal Mining 64,000 201,925
Tokyo Electric Power Company 29,000 554,079
Toyota Motor Corporation 9,000 209,059
Yokogawa Electric (b) 25,000 101,753
-----------
5,102,263
-----------
NETHERLANDS--9.3%
Getronics NV 3,550 161,162
Heineken NV 7,000 329,190
IHC Caland NV 2,500 117,701
ING Groep NV 9,400 423,745
KLM 7,250 182,852
Koninklijke Hoogovens NV 5,250 147,185
Koninklijke KPN NV 6,050 186,959
Philips Electronic 3,400 183,237
TNT Post Groep NV 6,050 154,193
Unilever NV 5,500 346,351
-----------
2,232,575
-----------
NORWAY--3.1%
Christiania Bank (b) 37,800 120,156
Elkem AS 18,220 202,061
Norske Skogsindustrier 9,710 243,603
Storebrand ASA 25,180 173,679
-----------
739,499
-----------
PORTUGAL--3.7%
BPI Soc Gestora 11,000 303,594
Electric De Portugal 26,100 597,940
-----------
901,534
-----------
SPAIN--2.0%
Iberdrola SA 14,377 239,557
Repsol SA 5,600 241,744
-----------
481,301
-----------
SWEDEN--4.2%
Diligentia 14,200 122,401
Drott AB, Class B 2,900 24,051
Electrolux AB, Class B 17,800 233,927
Ericsson (L.M.) Telefonaktiebol, Class B 16,700 315,356
Hennes and Mauritz, Class B 2,900 211,120
Skanska AB, Class B 3,400 112,140
-----------
1,018,995
-----------
</TABLE>
- -------------------------------------------------------------------------------
19
<PAGE>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE INTERNATIONAL EQUITY FUND--CONTINUED
- --------------------------------------------------------------------------------
COMMON STOCK--Continued
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
SWITZERLAND--7.6%
Holderbank Financiere Glarus 280 288,032
Roche Holdings AG 11 118,176
Sairgroup 545 112,324
Schweiz-Ruckversicherungs 160 318,169
Sulzer AG 230 116,580
Swatch Group 1,010 149,993
UBS AG 2,445 478,231
Valora Holding AG 1,110 251,286
-----------
1,832,791
-----------
UNITED KINGDOM--12.3%
Abbey National 9,400 162,047
Anglian Water 33,413 538,521
Barclays 19,900 325,125
BOC Group 9,600 120,690
British Petroleum 8,900 136,178
British Telecommunications 28,400 382,883
HSBC Holdings 12,300 220,195
Racal Electronics 20,400 119,848
Royal Bank of Scotland Group 9,700 110,489
Taylor Woodrow 42,500 131,565
United Utilities 36,948 597,373
Vodafone Group 9,600 111,472
-----------
2,956,386
-----------
TOTAL COMMON STOCK
(Cost $23,437,974) $23,544,848
-----------
SHORT TERM INVESTMENTS--2.1%
<CAPTION>
Par
value
<S> <C> <C>
State Street Repo 4.000%, 10/01/98 (Cost $502,000) (Dated
09/30/98), Collateralized by $400,000 U.S. Treasury Bond
9.250%, 02/15/16, Market Value $494,875, Repurchase
Proceeds $502,056. $502,000 $ 502,000
-----------
TOTAL SHORT TERM INVESTMENTS
(Cost $502,000) $ 502,000
-----------
TOTAL INVESTMENTS--100%
(Cost $23,939,974) (a) $24,046,848
===========
</TABLE>
(a) At September 30, 1998, the unrealized appreciation of investments based on
aggregate cost for federal tax purposes of $23,939,974 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $ 2,778,585
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (2,671,711)
-----------
Net unrealized appreciation $ 106,874
===========
</TABLE>
(b) A portion of security is on loan at 9/30/98. (Note 6)
<TABLE>
<CAPTION>
SECTOR ALLOCATIONS (AS A
PERCENTAGE OF TOTAL COMMON
STOCK)
- ---------------------------------
<S> <C>
Basic Industries 12.8%
Capital Goods 6.3%
Consumer Basics 7.6%
Consumer Durable Goods 7.1%
Consumer Non-Durable Goods 9.8%
Consumer Services 1.3%
Energy 5.8%
Finance 26.4%
General Business 4.8%
Miscellaneous 0.8%
Real Estate 0.5%
Shelter 6.8%
Technology 4.0%
Utilities 6.0%
</TABLE>
- -------------------------------------------------------------------------------
20
<PAGE>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
COMMON STOCK--90.1%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
ARGENTINA--7.2%
Astra Cia Argentina 71,970 $ 79,539
Banco Frances Rio Plata (a) 14,000 89,614
Central Puerto SA, Class B 20,000 48,007
Irsa Inversiones Y Representac (a) 5,000 10,602
Ledesma Agricola, Class B 70,000 49,008
Telefonica De Argentina, Class B 46,000 134,801
YPF SA, Class D 4,600 119,158
------------
530,729
------------
BRAZIL--1.8%
Centrais Electrobras 3,030,000 62,877
Embratel Participa (a) 528,000 4,409
Gerasul Centrais (a) 3,030,000 3,169
Sider Nacional Cia 2,383,000 39,239
Tele Celular Sul 528,000 401
Tele Centro Oeste 528,000 281
Tele Centro Sul Pa 528,000 3,363
Tele Leste Celular 528,000 147
Tele Norte Lests P 528,000 3,338
Tele Sudeste Celular 528,000 891
Telec Brasileiras-Telebras 528,000 111
Telemig Celular Pa 528,000 445
Telenordeste Celular 528,000 227
Telenorte Celular 528,000 111
Telesp Celular Par 528,000 2,227
Telesp Participaco 528,000 8,284
Vale Rio Doce(Cia) 4,148 0
Vale Rio Doce 500 5,357
------------
134,877
------------
CHILE--4.6%
Chilectra SA (d) 1,500 24,375
Compania Cervecerias Unidas SA (d) 2,280 41,895
Compania De Telecomunicaciones De
Chile (d) 4,110 78,604
Embotelladora Andina SA, Class A (d) 1,500 20,625
Embotelladora Andina SA, Class B (d) 1,500 16,594
Embotelladora Buenos Aires, Class B 35 1,330
Empresa Nacional De Electricid (d) 5,630 47,855
Enersis SA (d) 3,000 61,125
Gener SA (d) 1,900 28,381
Madeco SA (d) 2,880 19,800
------------
340,584
------------
CHINA--4.0%
China International Marine, Class B 20,900 10,789
Guangdong Electric, Class B 263,640 89,822
Guangshen Railway, Class H 202,000 26,329
Huaneng Power International Inc.,
Class N (a) (d) 6,600 67,650
Qingling Motors, Class H 119,300 23,094
Shanghai Dazhong Taxi, Class B (a) 72,000 33,264
Shanghai Petrochemical, Class H 331,800 33,827
Shanghai Tyre & Rubber, Class B (a) 35,200 4,858
------------
289,633
------------
</TABLE>
<TABLE>
Shares Value
<S> <C> <C>
GREECE--12.9%
Alpha Credit Bank 2,205 $ 163,975
Attica Enterprises 5,280 37,889
Commercial Bank of Greece 1,140 89,134
Ergo Bank 1,290 104,000
Hellenic Bottling Company 5,460 134,807
Hellenic Sugar Industries 3,072 27,542
Heracles General Cement 2,900 75,178
Intracom 1,812 66,808
National Bank Of Greece 1,111 149,796
Titan Cement Company 1,600 95,660
------------
944,789
------------
HUNGARY--2.5%
Magyar Olaj-Es Gazipare Resz 3,700 71,805
Matav Rt 8,000 35,225
OTP Bank 2,000 56,756
Pannonplast Muan Yagi Pari 1,000 22,885
------------
186,671
------------
INDIA--6.6%
Century Textiles (e) 6,000 4,500
Grasim Industries Ltd. (b) (e) 2,900 11,383
Gulf Corporation (e) 29,000 23,200
ITC Ltd. (e) 4,800 96,000
Larsen & Toubro (e) 3,000 25,425
Mahanagar Telep Ni (a) (e) 8,000 95,000
Mahindra & Mahindra (e) 6,000 24,000
Masisa SA (d) 2,500 13,750
Ranbaxy Laboratories Ltd (b) (e) 2,700 47,250
Reliance Industries (e) 7,600 40,660
St Bk India (e) 9,000 100,575
------------
481,743
------------
ISRAEL--3.1%
Bank Hapoalim Bm 45,000 109,886
Bezek Israel Telecom (a) 23,000 68,067
Koor Industries 600 50,086
------------
228,039
------------
MEXICO--7.7%
Alfa SA, Class A 6,915 17,630
Cemex SA, Class A 7,300 16,070
Cemex SA, Class B 7,000 17,469
Cemex SA 21,000 46,230
Cifra SA De Cv, Class V (a) 57,388 72,931
Fomento Economico Mexico, Class B 29,000 57,727
Grupo Industrial Bimbo, Class A 16,000 31,065
Grupo Mexico, Class B 7,800 19,886
Grupo Televisa SA (a) 2,100 19,975
Kimberly Clark De Mexico, Class B 5,000 11,890
Telefonos De Mexico, Class L 98,400 220,961
Vitro SA 26,000 35,591
------------
567,425
------------
</TABLE>
- -------------------------------------------------------------------------------
21
<PAGE>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE EMERGING MARKETS FUND--CONTINUED
- --------------------------------------------------------------------------------
COMMON STOCK--Continued
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
PERU--5.1%
Cementos Lima 3,022 $ 44,521
Cervs Peruanas Backus & Johnston, Class T 59,066 22,431
Cervs Peruanas Backus & Johnston, Class A 6,595 50,739
Credicorp Ltd. SA 5,520 40,365
Minas Buenaventura, Class B 7,805 45,994
Southern Peru Copper Corporation 1,261 13,871
Telefonica Del Peru, Class B 125,600 154,199
----------
372,120
----------
PHILIPPINES--1.4%
Manila Electric Company, Class B 22,000 41,989
Petron Corporation (a) 200,001 13,029
Philippine Long Distance 2,400 50,469
----------
105,487
----------
PORTUGAL--9.6%
Banco Commercial Portugues 6,600 178,379
Banco Espir Santo 4,637 127,248
BPI Soc Gestora 1,700 46,919
Cimpor Cimentos De Portugal 2,000 55,818
Jeronimo Martins SGPS 2,496 84,616
Modelo Contin SGPS 3,475 60,699
Portugal Telecom 3,328 121,218
Soporcel SA 2,000 28,616
----------
703,513
----------
SOUTH AFRICA--5.1%
Anglogold 1,200 63,820
Dimension Data Holding (a) 12,000 48,794
Foschini 32,960 40,375
Liberty Life Asso 5,500 83,748
Metropolitan Life 50,000 66,352
Rembrandt Group 10,000 59,802
Sun International of South Africa 80,000 13,611
----------
376,502
----------
TAIWAN--8.2%
MSCI Taiwan Index Series (b) (f) 6,700 602,933
----------
THAILAND--4.7%
Electricity Generating (a) 60,000 143,363
Hana Microelectronic (a) 18,000 51,429
One Holding (warrants exp. 10/11/01) (a) 7,940 0
Prime Finance & Securities (a) 131,400 0
PTT Exploration & Production (a) 17,000 149,583
----------
344,375
----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
TURKEY--5.6%
Akbank 2,325,104 $ 32,674
Dogan Holding 2,031,750 73,208
Ford Otomotiv San 40,000 9,080
KOC Holding 321,000 33,542
Konya Cimento 1,524,000 19,494
Sifas 3,689,852 23,599
T Garanti Bankasi 1,441,998 24,940
Turkiye Is Bankasi, Class C 4,750,000 124,941
Turk Hava Yollari (a) 214,000 13,687
Vestel Electronic Sanayi Ve T (a) 592,000 54,394
----------
409,559
----------
TOTAL COMMON STOCK
(Cost $8,030,130) $6,618,979
==========
PREFERRED STOCK--4.5%
BRAZIL--4.5%
Banco Est Sao Paulo 850,000 28,681
Banco Itau SA 239,000 112,902
Belgo-Mineira 1,600,000 58,982
Belgo-Mineira (rights exp. 4/7/98) 40,173 0
Centrais Electrobras 380,000 8,399
Embratel Participa (a) 825,000 8,699
Fosfatados Fertilizantes 11,700,000 34,050
Gerasul Centrais G, Class B 380,000 378
Telec Brasileiras-Telebras 825,000 278
Tele Celular Sul 825,000 1,162
Tele Centro Oeste 825,000 599
Tele Centro Sul Pa 825,000 8,699
Tele Leste Celular 825,000 320
Telemig Celular Pa 825,000 612
Telenordeste Celular 825,000 459
Telenorte Celular 825,000 223
Tele Norte Leste P 825,000 9,611
Telesp Celular Participacoes 825,000 5,568
Telesp Participaco 825,000 19,834
Tele Sudeste Celular 825,000 2,575
Usiminas Uni Sd Mg 1,632 4,818
Vale Rio Doce, Class A 1,648 25,023
----------
331,872
----------
TOTAL PREFERRED STOCK
(Cost $426,257) $ 331,872
==========
</TABLE>
- --------------------------------------------------------------------------------
22
<PAGE>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE EMERGING MARKETS FUND--CONTINUED
- --------------------------------------------------------------------------------
SHORT TERM INVESTMENTS--5.4%
<TABLE>
<CAPTION>
Par Value Value
<S> <C> <C>
State Street Repo 4.000%, 10/01/98 (Cost $399,000) (Dated
09/30/98), Collateralized by $350,000 U.S. Treasury Bond
7.000%, 07/15/06, Market Value $410,470, Repurchase
Proceeds $399,044 $399,000 $ 399,000
----------
TOTAL SHORT TERM INVESTMENTS
(Cost $399,000) $ 399,000
==========
TOTAL INVESTMENTS--100%
(Cost $8,855,387) (c) $7,349,851
==========
</TABLE>
(a) Non-income producing security.
(b) Security exempt from registration under Rule 144A of the Securities Act of
1933. (Note 2)
(c) At September 30, 1998, the unrealized depreciation of investments based on
aggregate cost for federal tax purposes of $8,855,387 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $ 1,130,345
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (2,635,881)
-----------
Net unrealized depreciation $(1,505,536)
===========
</TABLE>
(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.
<TABLE>
<CAPTION>
SECTOR ALLOCATIONS (AS A
PERCENTAGE OF TOTAL COMMON STOCK
AND PREFERRED STOCK)
- ----------------------------------
<S> <C>
Basic Industries 5.9%
Capital Goods 4.8%
Consumer Basics 8.8%
Consumer Durable Goods 2.1%
Consumer Non-Durable Goods 1.7%
Consumer Services 0.2%
Energy 6.7%
Finance 25.4%
General Business 4.9%
Mining 0.9%
Miscellaneous 8.7%
Real Estate 0.2%
Shelter 3.0%
Technology 5.3%
Transportation 1.6%
Utilities 19.8%
</TABLE>
- --------------------------------------------------------------------------------
23
<PAGE>
[LOGO APPEARS HERE]
- -------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS September 30, 1998 (Unaudited)
QUANTITATIVE FOREIGN VALUE FUND
- -------------------------------------------------------------------------------
COMMON STOCK--89.8%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
AUSTRIA--3.1%
RHI AG 4,500 $ 147,070
----------
CANADA--3.3%
Methanex Corporation (a) 27,000 154,872
----------
DENMARK--2.8%
Jyske Bank AS 1,600 131,013
----------
FINLAND--8.3%
Kesko 8,300 109,372
Neptune Maritime OY 35,000 158,324
Rautaruukki OY 22,700 126,793
----------
394,489
----------
FRANCE--2.9%
Christian Dior 1,700 136,612
----------
GERMANY--10.1%
Continental AG 4,000 95,572
A. Friedrich Flender AG (a) 905 126,812
Veba AG 2,800 145,873
Walter AG 3,000 111,381
----------
479,638
----------
HONG KONG--4.6%
VTech Holdings 55,000 219,324
----------
IRELAND--2.1%
Cream (James) 65,000 102,000
----------
ITALY--3.1%
ENI Spa (c) 2,400 147,000
----------
JAPAN--18.8%
Arisawa Manufacturing Company 16,000 152,264
Futaba Industrial 16,000 199,231
Takefuji Corporation 4,000 201,457
TDK Corporation 2,000 136,159
Toyota Motor Corporation 9,000 200,944
----------
890,055
----------
MEXICO--3.0%
Cemex (c) 29,000 141,726
----------
NETHERLANDS--6.9%
KLM 3,521 88,803
Roto Smeets D Boer 2,800 116,558
Schuttersveld Holding 5,500 120,610
----------
325,971
----------
NORWAY--3.1%
Orkla ASA, Class A 10,700 146,159
----------
SOUTH AFRICA--5.8%
Palabora Mining Company 30,000 102,080
Sappi Ltd. (a) 52,000 175,611
----------
277,691
----------
SPAIN--5.7%
Repsol SA (c) 2,200 92,813
Union Electrica Fenosa SA (a) 12,000 180,082
----------
272,895
----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
SWEDEN--4.1%
SKF AB, Class B 6,600 $ 81,684
Volvo AB, Class B 4,700 115,139
----------
196,823
----------
THAILAND--2.1%
Total Access Communication (a) 150,000 99,750
----------
TOTAL COMMON STOCK
(Cost $5,331,119) $4,263,088
==========
SHORT TERM INVESTMENTS--10.2%
<CAPTION>
Par Value Value
<S> <C> <C>
State Street Repo 4.000%, 10/01/98 (Cost $482,000) (Dated
09/30/98), Collateralized by $400,000 U.S. Treasury Bond
6.875%, 08/15/25, Market Value $494,875, Repurchase
Proceeds $482,054 $482,000 $ 482,000
----------
TOTAL SHORT TERM INVESTMENTS
(Cost $482,000) $ 482,000
==========
TOTAL INVESTMENTS--100%
(Cost $5,813,119) (b) $4,745,088
==========
</TABLE>
(a) Non-income producing security.
(b) At September 30, 1998, the unrealized depreciation of investments based on
aggregate cost for federal tax purposes of $5,813,119, was as follows :
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $ 84,983
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (1,153,014)
-----------
Net unrealized depreciation $(1,068,031)
===========
</TABLE>
(c) ADR--American Depository Receipts
<TABLE>
<CAPTION>
SECTOR ALLOCATIONS (AS A
PERCENTAGE OF TOTAL COMMON
STOCK)
- ---------------------------------
<S> <C>
Basic Industries 16.4%
Capital Goods 12.2%
Consumer Basics 8.4%
Consumer Durable Goods 12.5%
Consumer Non-Durable Goods 3.2%
Consumer Services 4.8%
Energy 5.6%
Finance 7.8%
General Business 2.4%
Shelter 6.9%
Technology 8.4%
Transportation 3.7%
Utilities 7.7%
</TABLE>
- -------------------------------------------------------------------------------
24
<PAGE>
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES September 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Growth and International Emerging Foreign
Small Cap Mid Cap Income Equity Markets Value
<S> <C> <C> <C> <C> <C> <C>
ASSETS :
Investments at value
(Note 2) $50,964,897 $14,006,749 $63,475,664 $24,046,848 $ 7,349,851 $4,745,088
Foreign currency at
value (Cost $34,784 for
International Equity,
$6,075 for Emerging
Markets and $158 for
Foreign Value) (Note 2) -- -- -- 35,427 6,126 164
Cash 1,557 1,944 1,111,621 1,163 490,698 1,803
Collateral for
securities loaned at
value (Note 6) -- -- -- 1,841,825 -- --
Dividends, interest and
foreign tax reclaims
receivable 42,298 6,622 86,238 90,261 26,423 5,843
Receivable for
investments sold 940,369 -- 254,694 13,198,080 -- 145,494
Receivable for shares of
beneficial interest sold 29,101 -- -- 1,378 -- --
Other assets 33,796 4,843 14,348 8,896 3,163 285
----------- ----------- ----------- ----------- ----------- ----------
Total assets 52,012,018 14,020,158 64,942,565 39,223,878 7,876,261 4,898,677
----------- ----------- ----------- ----------- ----------- ----------
LIABILITIES :
Collateral for
securities loaned (Note
6) -- -- -- 1,841,825 -- --
Payable for investments
purchased 777,874 142,446 1,057,325 13,416,592 -- 145,494
Payable for shares of
beneficial interest
repurchased 6,101 -- 23,000 -- -- --
Payable for compensation
of Manager (Note 3) 41,122 11,272 39,672 20,632 5,020 4,071
Payable for distribution
fees (Note 3) 18,903 -- 24,960 9,612 2,811 1,018
Payable to custodian 14,345 10,940 8,716 23,931 28,147 7,382
Payable to transfer
agent (Note 3) 7,604 1,346 9,612 4,081 1,444 --
Other accrued expenses 7,521 1,782 9,439 3,423 809 --
----------- ----------- ----------- ----------- ----------- ----------
Total liabilities 873,470 167,786 1,172,724 15,320,096 38,231 157,965
----------- ----------- ----------- ----------- ----------- ----------
NET ASSETS $51,138,548 $13,852,372 $63,769,841 $23,903,782 $ 7,838,030 $4,740,712
----------- ----------- ----------- ----------- ----------- ----------
NET ASSETS CONSIST OF :
Shares of beneficial
interest $56,450,805 $13,345,535 $41,383,777 $25,296,644 $12,181,233 $5,916,582
Undistributed net
investment income (loss) -- -- -- -- 10,423 2,854
Accumulated net realized
gain (loss) on
investments and foreign
denominated assets,
liabilities and currency (1,616,951) 322,269 8,334,824 (1,503,291) (2,847,120) (110,878)
Unrealized appreciation
(depreciation) of
investments and foreign
denominated assets,
liabilities and currency (3,695,306) 184,568 14,051,240 110,429 (1,506,506) (1,067,846)
----------- ----------- ----------- ----------- ----------- ----------
$51,138,548 $13,852,372 $63,769,841 $23,903,782 $ 7,838,030 $4,740,712
----------- ----------- ----------- ----------- ----------- ----------
Investment securities,
at cost $54,660,203 $13,822,181 $49,424,424 $23,939,974 $ 8,855,387 $5,813,119
----------- ----------- ----------- ----------- ----------- ----------
NET ASSETS
Ordinary Shares $47,024,137 $13,006,441 $60,116,139 $22,311,671 $ 7,026,736 $4,740,712
----------- ----------- ----------- ----------- ----------- ----------
Institutional Shares $ 4,114,411 $ 845,931 $ 3,653,702 $ 1,592,111 $ 811,294 $ --
----------- ----------- ----------- ----------- ----------- ----------
Shares of beneficial
interest outstanding
(Unlimited number of
shares authorized)
Ordinary Shares 3,497,141 970,658 3,093,624 2,285,731 1,277,609 601,956
----------- ----------- ----------- ----------- ----------- ----------
Institutional Shares 295,207 62,377 187,589 163,016 145,907 --
----------- ----------- ----------- ----------- ----------- ----------
Net asset value and
offering price per
share*
Ordinary Shares $ 13.45 $ 13.40 $ 19.43 $ 9.76 $ 5.50 $ 7.88
----------- ----------- ----------- ----------- ----------- ----------
Institutional Shares $ 13.94 $ 13.56 $ 19.48 $ 9.77 $ 5.56 $ --
----------- ----------- ----------- ----------- ----------- ----------
</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.
- -------------------------------------------------------------------------------
25
<PAGE>
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS Six Months Ended September 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Growth and International Emerging Foreign
Small Cap Mid Cap Income Equity Markets Value
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends* $ 239,101 $ 62,294 $ 500,734 $ 401,642 $ 173,986 $ 21,028
Interest 41,149 15,803 -- 25,557 10,091 11,725
Miscellaneous 1,277 -- -- -- -- --
------------ ----------- ----------- ----------- ----------- -----------
Total investment income 281,527 78,097 500,734 427,199 184,077 32,753
------------ ----------- ----------- ----------- ----------- -----------
EXPENSES:
Compensation of Manager
(Note 3) 320,797 79,626 260,271 153,245 37,996 16,072
Distribution fees, Or-
dinary Shares (Note 3) 147,228 18,793 163,877 72,003 21,404 4,018
Custodian fees 23,350 19,850 21,300 37,800 40,425 15,066
Transfer agent fees
(Note 3):
Ordinary Shares 41,243 10,518 45,865 20,159 5,985 2,226
Institutional Shares 3,691 624 2,696 1,292 656 --
Audit and legal 18,942 4,522 19,580 8,938 2,719 553
Registration fees 14,108 3,449 14,972 6,676 2,039 582
Insurance 8,642 2,103 9,132 4,088 1,249 339
Compensation of Trust-
ees (Note 3) 5,300 1,286 5,581 2,506 765 200
Printing 4,908 1,171 5,051 2,315 704 139
Miscellaneous 8,127 1,320 4,135 2,084 1,095 430
------------ ----------- ----------- ----------- ----------- -----------
Total expenses before
waivers and/or reim-
bursements, and reduc-
tions 596,336 143,262 552,460 311,106 115,037 39,625
Waivers and/or reim-
bursements of expenses
(Note 3) -- (14,443) -- -- (8,172) (7,226)
Fees reduced by credits
allowed by Custodian
(Note 3) -- -- (15,900) (6,063) (1,310) (2,500)
------------ ----------- ----------- ----------- ----------- -----------
EXPENSES, NET: 596,336 128,819 536,560 305,043 105,555 29,899
------------ ----------- ----------- ----------- ----------- -----------
Net investment income
(loss) (314,809) (50,722) (35,826) 122,156 78,522 2,854
------------ ----------- ----------- ----------- ----------- -----------
REALIZED AND UNREALIZED
GAIN (LOSS) ON
INVESTMENTS, FOREIGN
CURRENCY AND FOREIGN
TRANSLATION:
Net realized gain
(loss) (Note 2) on:
Investments (902,828) 180 2,932,096 (1,170,429) (394,326) (108,228)
Foreign denominated as-
sets, liabilities and
currency -- -- -- (15,446) 910 (2,650)
Change in unrealized
appreciation (deprecia-
tion) of:
Investments (15,962,165) (2,791,527) (7,543,032) (4,405,001) (2,785,542) (1,068,031)
Foreign denominated as-
sets, liabilities and
currency -- -- -- 6,815 (2,733) 185
------------ ----------- ----------- ----------- ----------- -----------
Net realized and
unrealized gain (loss) (16,864,993) (2,791,347) (4,610,936) (5,584,061) (3,181,691) (1,178,724)
------------ ----------- ----------- ----------- ----------- -----------
Net increase (decrease)
in net assets resulting
from operations $(17,179,802) $(2,842,069) $(4,646,762) $(5,461,905) $(3,103,169) $(1,175,870)
------------ ----------- ----------- ----------- ----------- -----------
</TABLE>
* Dividends and interest, respectively, are net of foreign withholding taxes
of $54,151 and $-0-, for International Equity, $8,705 and $4, for Emerging
Markets and $1,600 and $-0-, for Foreign Value.
The accompanying notes are an integral part of these financial statements.
- -------------------------------------------------------------------------------
26
<PAGE>
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS (UNAUDITED)
<TABLE>
<CAPTION>
Small Cap Mid Cap Growth and Income
Six Months ended Year ended Six Months ended Year ended Six Months ended Year ended
September 30, 1998 March 31, 1998 September 30, 1998 March 31, 1998 September 30, 1998 March 31, 1998
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE)
IN NET ASSETS :
Operations :
Net investment
income (loss) $ (314,809) $ (915,493) $ (50,722) $ (63,340) $ (35,826) $ 6,750
Net realized gain
(loss) on
investments, foreign
denominated assets,
liabilities,
currency and written
options (902,828) 2,413,066 180 2,419,921 2,932,096 8,864,329
Unrealized
appreciation
(depreciation) of
investments and
foreign denominated
assets, liabilities
and currency (15,962,165) 20,992,077 (2,791,527) 2,234,749 (7,543,032) 14,011,197
------------ ----------- ----------- ----------- ----------- -----------
Net increase
(decrease) in net
assets resulting
from operations (17,179,802) 22,489,650 (2,842,069) 4,591,330 (4,646,762) 22,882,276
Distributions to
shareholders from :
Net investment
income
Ordinary Shares -- (573,716) -- -- -- (124,594)
Institutional
Shares -- (122,203) -- -- -- (16,181)
Distributions in
excess of net
investment income
Ordinary Shares -- -- -- -- -- --
Institutional
Shares -- -- -- -- -- --
Net realized gains
Ordinary Shares -- (8,534,419) -- (2,319,745) -- (5,343,691)
Institutional
Shares -- (868,942) -- (120,011) -- (185,893)
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) -- (2,439,756) -- (5,670,359)
------------ ----------- ----------- ----------- ----------- -----------
Fund share
transactions (Note
11) (4,843,664) (5,460,907) 387,352 5,061,374 (1,703,713) 8,109,863
------------ ----------- ----------- ----------- ----------- -----------
Increase (decrease)
in net assets (22,023,466) 6,819,853 (2,454,717) 7,212,948 (6,350,475) 25,321,780
Net assets beginning
of year 73,162,014 66,342,161 16,307,089 9,094,141 70,120,316 44,798,536
------------ ----------- ----------- ----------- ----------- -----------
Net assets end of
year (*) $ 51,138,548 $73,162,014 $13,852,372 $16,307,089 $63,769,841 $70,120,316
============ =========== =========== =========== =========== ===========
(*) Includes
undistributed
(overdistributed) net
investment income of $ -- $ 947 $ -- $ -- $ -- $ 5,642
</TABLE>
The accompanying notes are an integral part of these financial statements.
- -------------------------------------------------------------------------------
27
<PAGE>
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS (UNAUDITED)--CONTINUED
<TABLE>
<CAPTION>
International Equity Emerging Markets Foreign Value
Six Months Ended Year ended Six Months Ended Year ended Six Months Ended Year ended
September 30, 1998 March 31, 1998 September 30, 1998 March 31, 1998 September 30, 1998 March 31, 1998
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DE-
CREASE) IN NET
ASSETS :
Operations :
Net investment
income (loss) $ 122,156 $ 204,235 $ 78,522 $ (38,727) $ 2,854 $ --
Net realized
gain (loss) on
investments,
foreign
denominated
assets,
liabilities,
currency and
written options (1,185,875) 220,658 (393,416) (2,089,353) (110,878) --
Unrealized
appreciation
(depreciation)
of investments
and foreign
denominated
assets,
liabilities and
currency (4,398,186) 3,313,394 (2,788,275) 190,861 (1,067,846) --
----------------- ---------------- ----------- ----------- ----------- ------
Net increase
(decrease) in
net assets
resulting from
operations (5,461,905) 3,738,287 (3,103,169) (1,937,219) (1,175,870) --
Distributions to
shareholders
from :
Net investment
income
Ordinary Shares -- (284,663) -- -- -- --
Institutional
Shares -- (28,084) -- -- -- --
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 capi-
tal
Ordinary Shares -- -- -- -- -- --
Institutional
Shares -- -- -- -- -- --
----------------- ---------------- ----------- ----------- ----------- ------
-- (1,206,602) -- -- -- --
----------------- ---------------- ----------- ----------- ----------- ------
Fund share trans-
actions (Note 11) (4,544,395) 2,208,378 698,549 916,061 5,916,582 --
----------------- ---------------- ----------- ----------- ----------- ------
Increase (de-
crease) in net
assets (10,006,300) 4,740,063 (2,404,620) (1,021,158) 4,740,712 --
Net assets begin-
ning of year 33,910,082 29,170,019 10,242,650 11,263,808 -- --
----------------- ---------------- ----------- ----------- ----------- ------
Net assets end of
year (*) $ 23,903,782 $ 33,910,082 $ 7,838,030 $10,242,650 $ 4,740,712 $ --
================= ================ =========== =========== =========== ======
(*) Includes
undistributed
(overdistributed)
net investment
income of $ -- $ (292,161) $ 10,423 $ (68,100) $ 2,854 $ --
</TABLE>
The accompanying notes are an integral part of these financial statements.
- -------------------------------------------------------------------------------
28
<PAGE>
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Income from
Investment Operations Distributions
----------------------------------------- ---------------------------------------------------------
Dividends
Net Asset Net Realized Dividends in excess of Distributions Distributions
Value at Net and Unrealized Total from from Net Net from in excess of
Beginning Investment Gain (Loss) Investment Investment Investment Realized Realized
of Period Income on Securities Operations Income Income Capital Gains Capital Gains
<S> <C> <C> <C> <C> <C> <C> <C> <C>
SMALL CAP
ORDINARY SHARES
Year Ended March
31, 1994 $14.12 (0.09) 2.57 2.48 -- -- (1.27) --
Year Ended March
31, 1995 (e) $15.33 (0.20) 1.67 1.47 -- -- (0.99) --
Year Ended March
31, 1996 (e) $15.81 (0.21)(a) 5.54 5.33 -- -- (2.23) --
Year Ended March
31, 1997 (e) $18.91 0.16 (a)(g) 0.77 0.93 -- -- (4.80) --
Year Ended March
31, 1998 (e) $15.04 (0.23)(a) 5.60 5.37 (0.16) -- (2.45)(h) --
Six Months Ended
September 30,
1998 (Unaudited)
(e) $17.80 (0.08)(a) (4.27) (4.35) -- -- -- --
INSTITUTIONAL SHARES (D)
Year Ended March
31, 1994 $14.15 (0.05) 2.63 2.58 -- -- (1.27) --
Year Ended March
31, 1995 (e) $15.46 (0.13) 1.71 1.58 -- -- (0.99) --
Year Ended March
31, 1996 (e) $16.05 (0.12)(a) 5.63 5.51 -- -- (2.23) --
Year Ended March
31, 1997 (e) $19.33 0.08 (a)(g) 0.94 1.02 -- -- (4.80) --
Year Ended March
31, 1998 (e) $15.55 (0.15)(a) 5.79 5.64 (0.34) -- (2.45)(h) --
Six Months Ended
September 30,
1998 (Unaudited)
(e) $18.40 (0.04)(a) (4.42) (4.46) -- -- -- --
MID CAP
ORDINARY SHARES
Oct. 3, 1994**
to March 31,
1995 (e) $10.00 0.05 (a) 0.07 0.12 -- -- -- --
Year Ended March
31, 1996 (e) $10.12 0.06 (a) 3.27 3.33 (0.01) -- (0.24) --
Year Ended March
31, 1997 (e) $13.20 0.09 (a) 2.29 2.38 (0.14) -- (2.00) --
Year Ended March
31, 1998 (e) $13.44 (0.08)(a) 6.06 5.98 -- -- (3.37) --
Six Months Ended
September 30,
1998 (Unaudited)
(e) $16.05 (0.05)(a) (2.60) (2.65) -- -- -- --
INSTITUTIONAL SHARES
April 17, 1995**
to March 31,
1996 (e) $10.27 0.10 (a) 3.09 3.19 (0.02) -- (0.24) --
Year Ended March
31, 1997 (e) $13.20 0.11 (a) 2.27 2.38 (0.03) -- (2.00) --
Year Ended March
31, 1998 (e) $13.55 (0.06)(a) 6.12 6.06 -- -- (3.37) --
Six Months Ended
September 30,
1998 (Unaudited)
(e) $16.24 (0.04)(a) (2.64) (2.68) -- -- -- --
GROWTH AND INCOME
ORDINARY SHARES
Year Ended March
31, 1994 $17.27 0.18 0.21 0.39 (0.16) -- (3.64) --
Year Ended March
31, 1995 (e) $13.86 0.14 1.44 1.58 (0.16) -- (1.56) --
Year Ended March
31, 1996 (e) $13.72 0.12 (a) 2.89 3.01 (0.13) -- (2.03) --
Year Ended March
31, 1997 (e) $14.57 0.08 (a) 2.53 2.61 (0.10) -- (1.86) --
Year Ended March
31, 1998 (e) $15.22 0.00 7.61 7.61 (0.05) -- (1.93) --
Six Months Ended
September 30,
1998 (Unaudited)
(e) $20.85 (0.01)(a) (1.41) (1.42) -- -- -- --
INSTITUTIONAL SHARES (D)
Year Ended March
31, 1994 $17.28 0.28 0.19 0.47 (0.25) -- (3.64) --
Year Ended March
31, 1995 (e) $13.86 0.21 1.44 1.65 (0.23) -- (1.56) --
Year Ended March
31, 1996 (e) $13.72 0.20 (a) 2.89 3.09 (0.20) -- (2.03) --
Year Ended March
31, 1997 (e) $14.58 0.15 (a) 2.55 2.70 (0.18) -- (1.86) --
Year Ended March
31, 1998 (e) $15.24 0.10 7.60 7.70 (0.17) -- (1.93) --
Six Months Ended
September 30,
1998 (Unaudited)
(e) $20.84 0.04 (a) (1.40) (1.36) -- -- -- --
<CAPTION>
Ratios and Supplemental Data
------------------------------------------------------
Ratio of Ratio of Net
Net Assets Operating Investment
Net Asset End of Expenses Income (Loss) Average
Total Value End Total Period to Average to Average Portfolio Commission
Distributions of Period Return(c) (000's) Net Assets Net Assets Turnover Rate(f)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
SMALL CAP
ORDINARY SHARES
Year Ended March
31, 1994 (1.27) $15.33 17.80 % $40,852 1.83% (1.30)% 389.00% --
Year Ended March
31, 1995 (e) (0.99) $15.81 10.24 % $53,920 1.84% (1.31)% 320.00% --
Year Ended March
31, 1996 (e) (2.23) $18.91 34.25 % $71,618 1.97%* (1.17)% 324.00% --
Year Ended March
31, 1997 (e) (4.80) $15.04 1.72 % $57,135 1.97%* 0.90 %(g) 393.00% $0.0305
Year Ended March
31, 1998 (e) (2.61) $17.80 37.79 % $66,876 1.90%* (1.33)% 135.00% $0.0406
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $13.45 (24.44)%(b) $47,024 1.91%(b) (1.02)%(b) 99.00%(b) --
INSTITUTIONAL SHARES (D)
Year Ended March
31, 1994 (1.27) $15.46 18.50 % $24,175 1.23% (0.70)% 389.00% --
Year Ended March
31, 1995 (e) (0.99) $16.05 10.88 % $47,044 1.36% (0.82)% 320.00% --
Year Ended March
31, 1996 (e) (2.23) $19.33 34.89 % $42,803 1.47%* (0.67)% 324.00% --
Year Ended March
31, 1997 (e) (4.80) $15.55 2.21 % $ 9,207 1.47%* 0.41 %(g) 393.00% $0.0305
Year Ended March
31, 1998 (e) (2.79) $18.40 38.44 % $ 6,286 1.41%* (0.86)% 135.00% $0.0406
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $13.94 (24.24)%(b) $ 4,114 1.40%(b) (0.53)%(b) 99.00%(b) --
MID CAP
ORDINARY SHARES
Oct. 3, 1994**
to March 31,
1995 (e) -- $10.12 1.20 % $ 420 -- % 1.50 %(b) 0.00%(b) --
Year Ended March
31, 1996 (e) (0.25) $13.20 33.01 % $ 6,025 2.34%* 0.46 % 181.00% --
Year Ended March
31, 1997 (e) (2.14) $13.44 17.47 % $ 8,733 1.19%* 0.62 % 162.00% $0.0492
Year Ended March
31, 1998 (e) (3.37) $16.05 46.76 % $15,484 1.57% (0.52)% 128.00% $0.0466
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $13.40 (16.51)%(b) $13,006 1.63%(b) (0.64)%(b) 179.00%(b) --
INSTITUTIONAL SHARES
April 17, 1995**
to March 31,
1996 (e) (0.26) $13.20 31.12 % $ 4,621 2.02%(b)* 0.87 %(b) 181.00% --
Year Ended March
31, 1997 (e) (2.03) $13.55 17.51 % $ 361 1.44%* 0.77 % 162.00% $0.0492
Year Ended March
31, 1998 (e) (3.37) $16.24 47.01 % $ 823 1.40% (0.35)% 128.00% $0.0466
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $13.56 (16.50)%(b) $ 846 1.57%(b) (0.56)%(b) 179.00%(b) --
GROWTH AND INCOME
ORDINARY SHARES
Year Ended March
31, 1994 (3.80) $13.86 1.51 % $36,510 1.72% 1.02 % 110.00% --
Year Ended March
31, 1995 (e) (1.72) $13.72 12.71 % $37,048 1.69% 1.01 % 121.00% --
Year Ended March
31, 1996 (e) (2.16) $14.57 22.17 % $41,353 1.73%* 0.81 % 152.00% --
Year Ended March
31, 1997 (e) (1.96) $15.22 17.97 % $43,266 1.73%* 0.50 % 98.00% $0.0397
Year Ended March
31, 1998 (e) (1.98) $20.85 51.52 % $66,397 1.69%* (0.01)% 72.00% $0.0368
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $19.43 (6.81)%(b) $60,116 1.62%(b)* (0.13)%(b) 78.00%(b) --
INSTITUTIONAL SHARES (D)
Year Ended March
31, 1994 (3.89) $13.86 1.99 % $ 3,990 1.22% 1.52 % 110.00% --
Year Ended March
31, 1995 (e) (1.79) $13.72 13.29 % $ 1,975 1.23% 1.48 % 121.00% --
Year Ended March
31, 1996 (e) (2.23) $14.58 22.75 % $ 1,888 1.24%* 1.31 % 152.00% --
Year Ended March
31, 1997 (e) (2.04) $15.24 18.62 % $ 1,532 1.24%* 0.99 % 98.00% $0.0397
Year Ended March
31, 1998 (e) (2.10) $20.84 52.18 % $ 3,724 1.19%* 0.50 % 72.00% $0.0368
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $19.48 (6.53)%(b) $ 3,654 1.12%(b)* 0.37 %(b) 78.00%(b) --
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
29
<PAGE>
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS--Continued
<TABLE>
<CAPTION>
Income from Distributions
Investment Operations Dividends
Net Asset Net Realized Dividends in excess of Distributions Distributions
Value at Net and Unrealized Total from from Net Net from in excess of
Beginning Investment Gain (Loss) Investment Investment Investment Realized Realized
of Period Income on Securities Operations Income Income Capital Gains Capital Gains
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INTERNATIONAL
EQUITY
ORDINARY SHARES
Year Ended March
31, 1994 $ 8.03 0.00 (a) 2.28 2.28 (0.13) -- -- --
Year Ended March
31, 1995 (e) $10.18 (0.03)(a) 0.04 0.01 (0.13) -- -- --
Year Ended March
31, 1996 (e) $10.06 0.00 (a) 0.67 0.67 (0.03) -- -- --
Year Ended March
31, 1997 (e) $10.70 0.01 (a) 0.40 0.41 (0.08) -- -- --
Year Ended March
31, 1998 (e) $11.03 0.07 (a) 1.30 1.37 (0.11) (0.06) (0.21) (0.05)
Six Months Ended
September 30,
1998 (Unaudited)
(e) $11.97 0.04 (a) (2.25) (2.21) -- -- -- --
INSTITUTIONAL
SHARES (D)
August 25,
1994** to March
31, 1995 (e) $11.00 0.01 (a) (0.73) (0.72) (0.18) -- -- --
Year Ended March
31, 1996 (e) $10.10 0.04 (a) 0.66 0.70 (0.07) -- -- --
Year Ended March
31, 1997 (e) $10.73 0.06 (a) 0.41 0.47 (0.10) -- -- --
Year Ended March
31, 1998 (e) $11.10 0.14 (a) 1.28 1.42 (0.20) (0.11) (0.21) (0.05)
Six Months Ended
September 30,
1998 (Unaudited)
(e) $11.95 0.07 (a) (2.25) (2.18) -- -- -- --
EMERGING MARKETS
ORDINARY SHARES
August 8, 1994**
to March 31,
1995 (e) $10.00 (0.05)(a) (2.71) (2.76) -- -- -- --
Year Ended March
31, 1996 (e) $ 7.24 (0.07)(a) 1.21 1.14 -- -- -- --
Year Ended March
31, 1997 (e) $ 8.38 (0.04)(a) 0.90 0.86 -- -- -- --
Year Ended March
31, 1998 (e) $ 9.24 (0.04) (1.50) (1.54) -- -- -- --
Six Months Ended
September 30,
1998 (Unaudited)
(e) $ 7.70 0.06 (a) (2.26) (2.20) -- -- -- --
INSTITUTIONAL
SHARES
April 2, 1996**
to March 31,
1997 (e) $ 8.49 0.01 (a) 0.80 0.81 (0.03) -- -- --
Year Ended March
31, 1998 (e) $ 9.27 0.02 (1.53) (1.51) -- -- -- --
Six Months Ended
September 30,
1998 (Unaudited)
(e) $ 7.76 0.07 (a) (2.27) (2.20) -- -- -- --
FOREIGN VALUE
ORDINARY SHARES
May 15, 1998**
to September 30,
1998 (Unaudited)
(e) $10.00 0.01 (a) (2.13) (2.12) -- -- -- --
<CAPTION>
Ratios and Supplemental Data
Ratio of Ratio of Net
Net Assets Operating Investment
Net Asset End of Expenses Income Loss) Average
Total Value End Total Period to Average to Average Portfolio Commission
Distributions of Period Return(c) (000's) Net Assets Net Assets Turnover Rate(g)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INTERNATIONAL
EQUITY
ORDINARY SHARES
Year Ended March
31, 1994 (0.13) $10.18 28.69 % $26,222 2.01% (0.08)% 40.00% --
Year Ended March
31, 1995 (e) (0.13) $10.06 0.07 % $27,657 1.91% (0.24)% 46.48% --
Year Ended March
31, 1996 (e) (0.03) $10.70 6.63 % $27,402 2.15%* (0.04)% 43.00% --
Year Ended March
31, 1997 (e) (0.08) $11.03 3.82 % $27,410 2.20%* 0.10 % 135.00% $0.0140
Year Ended March
31, 1998 (e) (0.43) $11.97 12.95 % $32,182 2.18%* 0.62 % 61.00% $0.0095
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $ 9.76 (18.46)%(b) $22,312 2.07%(b)* 0.77 %(b) 155.00%(b) --
INSTITUTIONAL
SHARES (D)
August 25,
1994** to March
31, 1995 (e) (0.18) $10.10 (6.57)% $ 3,052 1.66%(b) 0.13 %(b) 46.48%(b) --
Year Ended March
31, 1996 (e) (0.07) $10.73 6.95 % $ 1,241 1.65%* 0.38 % 43.00% --
Year Ended March
31, 1997 (e) (0.10) $11.10 4.38 % $ 1,760 1.69%* 0.51 % 135.00% $0.0140
Year Ended March
31, 1998 (e) (0.57) $11.95 13.50 % $ 1,728 1.68%* 1.19 % 61.00% $0.0095
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $ 9.77 (18.24)%(b) $ 1,592 1.56%(b)* 1.23 %(b) 155.00%(b) --
EMERGING MARKETS
ORDINARY SHARES
August 8, 1994**
to March 31,
1995 (e) -- $ 7.24 (27.60)% $ 4,259 2.54%(b) (1.03)%(b) 10.72%(b) --
Year Ended March
31, 1996 (e) -- $ 8.38 15.75 % $ 7,736 2.74%* (0.84)% 9.00% --
Year Ended March
31, 1997 (e) -- $ 9.24 10.26 % $10,052 2.68%* (0.47)% 8.00% $0.0024
Year Ended March
31, 1998 (e) -- $ 7.70 (16.67)% $ 9,241 2.69%* (0.43)% 52.00% $0.0008
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $ 5.50 (28.57)%(b) $ 7,027 2.31%(b)* 1.61 %(b) 40.00%(b) --
INSTITUTIONAL
SHARES
April 2, 1996**
to March 31,
1997 (e) (0.03) $ 9.27 9.54 % $ 1,212 2.01%(b)* 0.13 %(b) 8.00%(b) $0.0024
Year Ended March
31, 1998 (e) -- $ 7.76 (16.29)% $ 1,002 2.19%* 0.24 % 52.00% $0.0008
Six Months Ended
September 30,
1998 (Unaudited)
(e) -- $ 5.56 (28.35)%(b) $ 811 1.79%(b)* 2.06 %(b) 40.00%(b) --
FOREIGN VALUE
ORDINARY SHARES
May 15, 1998**
to September 30,
1998 (Unaudited)
(e) -- $ 7.88 (21.20)%(b) $ 4,741 2.02%(b)* 0.18 %(b) 10.00%(b) --
</TABLE>
* EXPENSE RATIOS FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1998 AND 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 EXPENSES OF THE FUND. THE FUNDS'
EXPENSE RATIOS NET OF SUCH CREDITS, AS REPORTED 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%, RESPECTIVELY, FOR THE PERIODS ENDED MARCH 31,
1998, 1997 AND 1996; MID CAP ORDINARY 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 INCOME ORDINARY AND INSTITUTIONAL SHARES, 1.58%,
1.65%, 1.70%, 1.64% AND 1.08%, 1.14%, 1.21%, 1.15%, RESPECTIVELY, FOR THE PE-
RIODS ENDED SEPTEMBER 30, 1998, MARCH 31, 1998, 1997 AND 1996; INTERNATIONAL
EQUITY ORDINARY AND INSTITUTIONAL SHARES, 1.98%, 2.03%, 2.15%, 2.09% AND
1.48%, 1.54%, 1.64%, 1.59%, RESPECTIVELY, FOR THE PERIODS ENDED SEPTEMBER 30,
1998, MARCH 31, 1998, 1997 AND 1996; EMERGING MARKETS ORDINARY AND INSTITU-
TIONAL SHARES, 2.28%, 2.57%, 2.56%, 2.59% AND 1.77%, 2.07%, 1.89%
(ANNUALIZED), --, RESPECTIVELY FOR THE PERIODS ENDED SEPTEMBER 30, 1998,
MARCH 31, 1998, 1997 AND 1996; AND FOREIGN VALUE ORDINARY SHARES 1.87% FOR
THE PERIOD ENDED SEPTEMBER 30, 1998.
** 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 September 30, 1998, March 31,
1998, 1997, 1996 and 1995 reflect a reduction of $0.01, $0.07, $0.15, $0.23
and $0.76 per share; expenses 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 periods 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 re-
flect a reduction of $--, $0.01, $0.01, $0.01 and $0.01 per share respec-
tively; 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; expenses of the Emerging
Markets Ordinary Shares for the periods ended September 30, 1998, March 31,
1997, 1996 and 1995 reflect a reduction of $0.01, $0.01, $0.01 and $0.02
per share; expenses of the Emerging Markets Institutional Shares for the
periods ended September 30, 1998 and March 31, 1997 reflects a reduction of
$0.01 and $0.02 per share; and expenses of the Foreign Value Ordinary
Shares for the period ended September 30, 1998 reflect a reduction of $0.01
per share.
- --------------------------------------------------------------------------------
30
<PAGE>
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS--Continued
(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) Per share numbers have been calculated using the average shares method.
(f) In accordance with SEC reporting requirements the average commission rate
has been calculated for fiscal years ending March 31, 1998 and 1997.
(g) 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.
(h) 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.
- --------------------------------------------------------------------------------
31
<PAGE>
[LOGO APPEARS HERE]
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
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 six 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, Quantitative Emerging Markets, and Quantitative Foreign Value.
Quantitative Small Cap, Quantitative Mid Cap and Quantitative Emerging Markets
were formerly known as Quantitative Numeric, Quantitative Numeric II, and
Quantitative Foreign Frontier 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.
The Quantitative Foreign Value Fund ("Foreign Value") seeks long-term capital
growth and income by investing in a diversified portfolio consisting primarily
of foreign securities. Generally, the Fund invests in Western Europe, Austra-
lia, and the larger capital markets in the Far East. The Fund may also invest
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, Emerging Markets and Foreign Value, a de-
ferred 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.
- -------------------------------------------------------------------------------
32
<PAGE>
[LOGO APPEARS HERE]
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS--Continued
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, the Funds realize a gain or loss, and the liability is eliminat-
ed. 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. Purchased options and the liability related to premiums received on
written options are valued based upon their quoted daily settlement price.
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 $661,566 or 8% of net assets of Emerging Mar-
kets; and $0 for each of Small Cap, Mid Cap, Growth and Income, International
Equity and Foreign Value.
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, International Equity and Foreign Value;
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 2.25%, 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.
For the six months ended September 30, 1998, the fees waived or expenses reim-
bursed by the Manager amounted to $68 and $8,172 for Mid Cap and Emerging Mar-
kets respectively. The aggregate management fees, net of fees waived or reim-
bursed by the Manager amounted to $859,767.
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
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33
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NOTES TO FINANCIAL STATEMENTS--Continued
Cap), State Street Bank and Trust Company (Growth and Income), Independence
International Associates, Inc. (International Equity, Emerging Markets), and
Polaris Capital Management, Inc. (Foreign Value).
For services rendered, the Manager pays to the Advisor of a Fund a fee gener-
ally 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 Advisors of the Funds are as follows: Small Cap and International Equi-
ty--0.50% of average daily total net assets; Mid Cap and Emerging Markets--
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 fee for Foreign
Value is based on a percentage of the management fee received by the Manager
for managing Foreign Value: 25% for assets up to $30 million and 50% for as-
sets in excess of $30 million.
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 and Foreign Value 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 Distributor for Institutional Shares. For the six months ended
September 30, 1998, the Distributor voluntarily agreed to waive its fees in
part with respect to Mid Cap, which amounted to $14,375. During the six months
ended September 30, 1998, the aggregate fees, net of fees waived by the Dis-
tributor, paid by the Funds pursuant to such distribution plan amounted to
$412,948. A deferred sales charge amounting to 1% of the net asset value of
Ordinary Shares redeemed of Small Cap, Growth and Income, International Equi-
ty, Emerging Markets and Foreign Value is withheld from the redemption pro-
ceeds 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 Institutional
Shares, and certain other transactions. The Funds have been advised that dur-
ing the six months ended September 30, 1998, such fees earned by the Distribu-
tor were $112,564.
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 six months ended
September 30, 1998, the aggregate fees, net of fees waived by the Transfer
Agent, paid by the Funds pursuant to such agreement amounted to $132,729. For
the six months ended September 30, 1998, the Transfer Agent voluntarily agreed
to waive its fees in their entirety with respect to Foreign Value which
amounted to $2,226.
Custody and fund accounting services are provided by Investors Fiduciary Trust
Company ("IFTC"), a wholly owned subsidiary of State Street Bank and Trust
Company. Custody credits generated by interest earned on uninvested cash bal-
ances maintained by the Funds are used to offset custodial expenses of the
Funds. For the six months endedSeptember 30, 1998, IFTC voluntarily agreed to
waive its minimum fees in part with respect to Foreign Value, which amounted
to $5,000.
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 six months ended September 30, 1998, purchases of investment secu-
rities other than U.S. Government obligations and short-term investments, for
Small Cap, Mid Cap, Growth and Income, International Equity, Emerging Markets
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34
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- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS--Continued
and Foreign Value were $30,311,759, $14,059,589, $25,842,607, $22,438,014,
$2,170,068 and $5,581,534, respectively. Sales of such securities for the
Funds were $34,987,585, $13,450,221, $26,060,618, $26,314,914, $1,704,114, and
$142,186, respectively. Purchases and sales of U.S. Government obligations
were $2,000,000 and $2,000,000 respectively for International Equity
6. Securities Loans.
As of September 30, 1998, International Equity loaned common stocks having a
value of $1,703,958 and received cash collateral of $1,841,825 for these
loans.
Security lending income of $6,827 collected by IFTC was recorded in interest
income on the Statement of Operations.
7. Reclassifications.
For the six months ended September 30, 1998, certain reclassification adjust-
ments were made between undistributed/ (overdistributed) net investment income
and accumulated net realized gain/(loss) due to differences between book and
tax accounting, primarily due to current year net operating losses for Small
Cap, Mid Cap, Growth and Income and International Equity. Such reclassifica-
tions 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 -- 313,862 (313,862)
Mid Cap -- 50,722 (50,722)
Growth and Income -- 30,184 (30,184)
International Equity -- 170,005 (170,005)
</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
---------------------------------
Fund Number % of Fund Held
<S> <C> <C>
Small Cap Inst............................ 6 71%
Mid Cap Ord............................... 2 19%
Growth and Income Inst.................... 4 82%
International Equity Inst................. 1 92%
Emerging Markets Inst..................... 3 94%
Foreign Value Ord......................... 4 30%
</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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35
<PAGE>
[LOGO APPEARS HERE]
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NOTES TO FINANCIAL STATEMENTS--Continued
11. Transactions in Shares of Beneficial Interest.
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
September 30, 1998 March 31, 1998
--------------------- ----------------------
Shares Dollars Shares Dollars
<S> <C> <C> <C> <C>
SMALL CAP
ORDINARY SHARES:
Shares sold 147,512 $ 2,405,006 356,461 $ 6,027,298
Shares issued in reinvestment
of distributions -- -- 550,052 8,762,319
Shares redeemed (408,310) (6,460,118) (947,877) (15,988,184)
-------- ----------- -------- ------------
Net change (260,798) $(4,055,112) (41,364) $ (1,198,567)
-------- ----------- -------- ------------
INSTITUTIONAL SHARES:
Shares sold 1,006 $ 15,508 76,347 $ 1,343,153
Shares issued in reinvestment
of distributions -- -- 34,000 558,954
Shares redeemed (47,430) (804,060) (360,913) (6,164,447)
-------- ----------- -------- ------------
Net change (46,424) $ (788,552) (250,566) $ (4,262,340)
-------- ----------- -------- ------------
TOTAL NET CHANGE FOR FUND $(4,843,664) $ (5,460,907)
----------- ------------
MID CAP
ORDINARY SHARES:
Shares sold 85,222 $ 1,334,279 323,072 $ 4,936,609
Shares issued in reinvestment
of distributions -- -- 153,778 2,265,150
Shares redeemed (79,308) (1,134,847) (161,738) (2,497,310)
-------- ----------- -------- ------------
Net change 5,914 $ 199,432 315,112 $ 4,704,449
-------- ----------- -------- ------------
INSTITUTIONAL SHARES:
Shares sold 22,076 $ 355,244 24,031 $ 362,791
Shares issued in reinvestment
of distributions -- -- 8,065 120,011
Shares redeemed (10,360) (167,324) (8,069) (125,877)
-------- ----------- -------- ------------
Net change 11,716 $ 187,920 24,027 $ 356,925
-------- ----------- -------- ------------
TOTAL NET CHANGE FOR FUND $ 387,352 $ 5,061,374
----------- ------------
GROWTH AND INCOME
ORDINARY SHARES:
Shares sold 158,432 $ 3,315,462 411,100 $ 7,998,681
Shares issued in reinvestment
of distributions -- -- 253,654 4,723,028
Shares redeemed (249,442) (5,198,611) (322,168) (6,086,768)
-------- ----------- -------- ------------
Net change (91,010) $(1,883,149) 342,586 $ 6,634,941
-------- ----------- -------- ------------
INSTITUTIONAL SHARES:
Shares sold 18,248 $ 381,668 85,691 $ 1,602,542
Shares issued in reinvestment
of distributions -- -- 10,834 201,396
Shares redeemed (9,291) (202,232) (18,462) (329,016)
-------- ----------- -------- ------------
Net change 8,957 $ 179,436 78,063 $ 1,474,922
-------- ----------- -------- ------------
TOTAL NET CHANGE FOR FUND $(1,703,713) $ 8,109,863
----------- ------------
</TABLE>
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36
<PAGE>
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NOTES TO FINANCIAL STATEMENTS--Continued
<TABLE>
<CAPTION>
Six Months Ended Year Ended
September 30, 1998 March 31, 1998
--------------------- ----------------------
Shares Dollars Shares Dollars
<S> <C> <C> <C> <C>
INTERNATIONAL EQUITY
ORDINARY SHARES:
Shares sold 176,679 $ 2,097,615 465,824 $ 5,430,040
Shares issued in reinvestment
of distributions -- -- 102,951 1,093,343
Shares redeemed (579,371) (6,867,942) (365,138) (4,141,960)
-------- ----------- -------- ------------
Net change (402,692) $(4,770,327) 203,637 $ 2,381,423
-------- ----------- -------- ------------
INSTITUTIONAL SHARES:
Shares sold 18,643 $ 228,564 5,215 $ 55,388
Shares issued in reinvestment
of distributions -- -- 7,592 80,395
Shares redeemed (216) (2,632) (26,843) (308,828)
-------- ----------- -------- ------------
Net change 18,427 $ 225,932 (14,036) $ (173,045)
-------- ----------- -------- ------------
TOTAL NET CHANGE FOR FUND $(4,544,395) $ 2,208,378)
----------- ------------
EMERGING MARKETS
ORDINARY SHARES:
Shares sold 152,117 $ 1,091,440 308,029 $ 2,634,998
Shares issued in reinvestment
of distributions -- -- -- --
Shares redeemed (75,119) (517,369) (195,299) (1,708,550)
-------- ----------- -------- ------------
Net change 76,998 $ 574,071 112,730 $ 926,448
-------- ----------- -------- ------------
INSTITUTIONAL SHARES:
Shares sold 16,852 $ 124,478 2,349 $ 17,973
Shares issued in reinvestment
of distributions -- -- -- --
Shares redeemed -- -- (4,047) (28,360)
-------- ----------- -------- ------------
Net change 16,852 $ 124,478 (1,698) $ (10,387)
-------- ----------- -------- ------------
TOTAL NET CHANGE FOR FUND $ 698,549 $ 916,061
----------- ------------
FOREIGN VALUE
ORDINARY SHARES:
Shares sold 658,121 $ 6,424,178 -- --
Shares issued in reinvestment
of distributions -- -- -- --
Shares redeemed (56,165) (507,596) -- --
-------- ----------- -------- ------------
Net change for fund 601,956 $ 5,916,582 -- --
-------- ----------- -------- ------------
TOTAL NET CHANGE FOR FUND $ 5,916,582 --
----------- ------------
</TABLE>
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37
<PAGE>
QUANTITATIVE GROUP OF FUNDS
55 Old Bedford Road
Lincoln, MA 01773
1-800-331-1244
www.quantfunds.com
MANAGER
Quantitative Advisors, Inc.
55 Old Bedford Road
Lincoln, MA 01773
ADVISORS
Columbia Partners, LLC,
Independence International Associates, Inc. Investment Management
53 State Street 1775 Pennsylvania Avenue, N.W.
Boston, MA 02109 Washington, D.C. 20006
Polaris Capital Management, Inc. State Street Bank and Trust Company
125 Summer Street 225 Franklin Street
Boston, MA 02110 Boston, MA 02110
DISTRIBUTOR
U.S. Boston Capital Corporation
55 Old Bedford Road
Lincoln, MA 01773
CUSTODIAN
Investors Fiduciary Trust Company
801 Pennsylvania Avenue
St. Louis, MO 64105
TRANSFER AGENT
Quantitative Institutional Services
55 Old Bedford Road
Lincoln, MA 01773
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
160 Federal Street
Boston, MA 02110
<PAGE>
[LOGO APPEARS HERE]
QUANTITATIVE
GROUP of FUNDS
55 Old Bedford Road
Lincoln, MA 01773
voice 800/331-1244
fax 781/259-1166
www.quantfunds.com
Distributed by U.S. Boston Capital Corp.
