QUANT FUNDS
[LOGO OF QUANT FUNDS] ANNUAL REPORT
MARCH 31, 2000
U.S. EQUITY FUNDS
Quant Growth and Income Fund
Quant Mid Cap Fund
Quant Small Cap Fund
INTERNATIONAL EQUITY FUNDS
Quant Emerging Markets Fund
Quant Foreign Value Fund
Quant International Equity Fund
<PAGE>
QUANT FUNDS
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[LOGO OF QUANT FUNDS]
May 30, 2000
Dear Fellow Shareholder:
I am pleased to provide you with the Annual Report of the Quant Funds for
the twelve-month period ending March 31, 2000. This letter will give you an
overview of the funds as well as an update on some technological enhancements we
have made in providing you with more information and better service.
There were two global themes that contributed to outperformance over the
course of the fiscal year ended March 31, 2000: sector allocation and stock
selection. Regardless of whether a fund was domestic or international, if a
majority of the portfolio was comprised of holdings within the technology and
telecommunications sectors as well as having more growth than value holdings,
fund strategies could be directly correlated with higher fund performance over
the fiscal year. These two sectors drove performance returns in many of our
mutual funds. In addition, some holdings within these sectors individually
returned over 100% in several domestic fund benchmarks, which comprised the
majority of the total return within those benchmarks. Last year, we mentioned
that we planned to introduce a few select Internet holdings into our portfolios,
but only those that we felt showed promise of posting positive earnings. A
majority of the companies that we added to our domestic portfolios were
semiconductor companies with a focus on wireless and Internet applications. As
the year progressed, investors made a deliberate shift in their focus from pure
Internet stocks to Internet enablers, or companies that enable e-commerce. These
Internet enabling companies contributed to the significant returns that
dominated many portfolio and benchmark returns.
As technology was the dominating sector, the divergence between growth and
value stocks was enormous over the course of the fiscal year. Growth stocks
significantly outperformed value stocks. The extreme divergence that occurred
between these types of stocks had a direct impact on both growth and
value-oriented mutual funds, the latter suffering in performance returns. In the
fall of 1999, for the developed countries, the underperformance of value stocks
versus growth stocks was the largest in twenty-five years. For domestic
products, the performance of some of these specific growth stocks led to a
reversal in the market where some small cap stocks significantly outperformed
their large cap brethren.
The small cap stock rally, after lagging for several months was again due
to outperformance in the technology sector. Additionally, the health care sector
had some high returns. The health care surge was predominantly led by
biotechnology companies and specialty pharmaceutical companies.
In the emerging markets, a continuing rebound was the story for the fiscal
year period. A major underestimation of the resilience of emerging markets,
combined with a growing concern over domestic inflation has accounted for much
of the resurgence. The portfolio manager of the Quant Emerging Markets Fund
indicated that most investment professionals thought that the damage inflicted
on the emerging markets would take years to repair, but the restructuring has
been remarkable. Currencies have stabilized, interest rates and debt levels have
dropped significantly, current account balances have surged, and earnings
reports continue to improve. Additionally, once you factor in the growing
concern over inflation and recent deteriorating trade balances in the U. S.
markets, the result is that many investors have begun to shift their sights
overseas.
In terms of providing you access to Quant Funds information, we are pleased
to let you know that we have also made some substantial technological
enhancements to our web site, www.quantfunds.com. The following is a list of
some of these enhancements:
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.
<PAGE>
Report of Independent Accountants
To the Shareholders and Trustees of the Quantitative Group of Funds
In our opinion, the accompanying statements of assets and liabilities, in-
cluding the portfolio of investments, and the related statements of operations
and of changes in net assets and the financial highlights present fairly, in
all material respects, the financial position of each of the portfolios con-
stituting the Quantitative Group of Funds (hereafter referred to as the
"Funds") at March 31, 2000, the results of each of their operations for the
year then ended, the changes in each of their net assets and the financial
highlights for each of the periods indicated, in conformity with accounting
principles generally accepted in the United States. These financial statements
and financial highlights (hereafter referred to as "financial statements") are
the responsibility of the Funds' management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States, which require that we plan and per-
form the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presenta-
tion. We believe that our audits, which included confirmation of securities at
March 31, 2000 by correspondence with the custodian and brokers, provide a
reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
Kansas City, MO
May 8, 2000
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<PAGE>
[LOGO OF QUANT FUNDS]
. Price, Fund and Benchmark Performance: By approximately 6:30 pm on
each business day, our web site has this information updated for your
review.
. Quarterly Fund Information: All fund statistics (including
performance, top ten holdings, sector/country allocation, manager
commentary, etc.) are updated within 3 business days following the end
of each quarter (3/31, 6/30, 9/30, 12/31).
. Press Releases: All releases are posted to the press release portion
of the site the day that the press release is issued. Additionally,
the two most recent press releases can be viewed directly from the
Quant Funds home page.
. Shareholder Lookup and Subsequent Investment: As a Quant Funds
shareholder, you are now able to look up your current and historical
account balances at any time. Additionally, you can make new purchases
into your existing Quant Funds accounts.
. New Investments Online: Potential investors can purchase into any of
the Quant Funds directly from our web site using ACH (Automated
Clearing House) transaction capability.
These are just a few of the enhancements that we have made to the web site,
and we have more in store during the upcoming months. We are always looking for
better ways to service you and provide you with timely information. Feel free to
email us at [email protected] if you have any suggestions for our web
site.
We look forward with great anticipation to the opportunities and challenges
of the coming year. We are available at any time to answer your questions or to
provide assistance. We know you have many investment choices, and we want to
thank you for your continued confidence and support.
Sincerely,
/s/ Willard L. Umphrey
Willard L. Umphrey
President
<PAGE>
QUANT MID CAP FUND
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INVESTMENT PROFILE All Data as of March 31, 2000
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INVESTMENT COMMENTARY
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The Quant Mid Cap Fund had a one-year return of 71.41%, and outperformed its
benchmark, the S&P 400 Index which only returned 38.09% for the fiscal year
ended March 31, 2000.
Similar to the small cap fund arena, companies that enable e-commerce,
contributed greatly to the fund's performance for the period ended March 31,
2000. In the past, the fund's combination of quantitative and fundamental
analyses indicated that the technology sector would have some potential upswing.
Citrix Systems, a software company, was up over 400% for the one-year period
ended March 31, 2000. The fund has held the Citrix Systems stock in its
portfolio for over three years. Analog Devices, a semiconductor company, was
also up over 400% and has been in the fund's portfolio for over a year. During
the fiscal year, mid cap stocks with the highest price/earnings ratios
outperformed and experienced the most overall growth primarily within the
technology sector.
The performance of mid cap growth stocks, in particular, improved dramatically
during 1999 and outperformed most of the larger growth stocks. We felt that
optimistic investors appeared to be seeking newer growth companies in rapidly
changing industries. We believe the resiliency is in part due to the forecasted
acceleration in earnings growth as companies benefit from improving global
economies.
Looking ahead, the fund's manager currently expects to retain the portfolio's
construction with the fund slowly reducing its overall exposure in the
technology sector in an effort to help keep the portfolio risk-controlled. We
believe that mid cap stocks continue to be an excellent investment for the
upcoming months.
All sector/security returns for the specific period referenced above refer to
the specific period's weighted returns in the individual securities comprising
the S&P 400 Index.
<TABLE>
<CAPTION>
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PERFORMANCE UPDATE (at POP) 1Q00 Calendar YTD One Year Five Year Since Inception
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<S> <C> <C> <C> <C> <C>
Quant Mid Cap Fund 28.47% 28.47% 71.41% 31.20% 31.30% (3/21/95)
S&P 400 Index 12.69% 12.69% 38.09% 24.06% 24.22%
</TABLE>
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VALUE OF $10,000 INVESTED IN QUANT MID CAP (QMC) ORDINARY SHARES VS. S&P 400
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[GRAPH]
QMC S&P 400
10,000 10,000
12,565 12,262
16,142 14,616
20,761 19,330
23,428 23,025
30,683 25,416
39,393 29,768
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FUND INFORMATION
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Ticker Symbol QNIIX (Ordinary)
QNIAX (Institutional)
Number of Companies 45
Median Market Cap $5.64 billion
Price to Book 6.0
Price to Earnings 28.8
Assets Under Management $21 million
The S&P 400 Index is an unmanaged index comprised of stocks outside the large
capitalization bias of the S&P 500, which are chosen by Standard & Poors for
their size and industry characteristics. It is widely recognized as
representative of the general market for stocks with medium capitalizations.
Investment returns assume the reinvestment of dividends paid on stocks
comprising the Index.
Past performance is no guarantee of future results. This information may be used
only when preceded or accompanied by a prospectus. Returns at Public Offering
Price ("POP") reflect the average annual returns of Ordinary Shares of the fund,
and reflect the waiver of the 0.25% 12b-1 fee from 5/12/98 through the end of
the period. Absent the waiver, performance would have been lower. Institutional
shares of the fund are available to clients of some financial advisors without a
12b-1 fee. The one year and since inception (4/17/95) returns for Institutional
Shares are 72.81% and 31.41%. Share prices will vary, and shares may be worth
more or less than their original cost at the time of sale. The investment return
and principal value of an investment will fluctuate. The fund's portfolio is
subject to change. Distributed by U.S. Boston Capital Corporation.
<PAGE>
QUANT MID CAP FUND
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INVESTMENT PROFILE All Data as of March 31, 2000
[PHOTO]
Robert von Pentz
The Quant Mid Cap Fund seeks investment opportunities among companies with
medium market capitalizations. 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 have the potential to 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
are also employed to help limit 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 may bear upon future performance. A strict,
passionless sell discipline is employed if a company's rankings deteriorate.
Management The fund is managed by Robert von Pentz, CFA, an owner and chief
equity investment officer of Columbia Partners, LLC Investment Management
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.
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TOP TEN HOLDINGS
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Company % Total Net Assets
Analog Devices 3.9
Rational Software Corp. 3.2
Applied Micro Circuits Corp. 2.9
Terayon Communication Systems Inc. 2.9
Citrix Systems Inc. 2.8
Transwitch Corp. 2.8
Inktomi Corp. 2.7
DII Group Inc. 2.6
BJ Services Co. 2.5
American Power Conversion 2.5
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SECTOR ALLOCATION
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[GRAPH]
Consumer Cyclicals 17%
Energy 9%
Financials 10%
Health Care 5%
Basic Materials 4%
Cash and Other Assets (Net) 9%
Utilities 7%
Technology 39%
<PAGE>
QUANT GROWTH AND INCOME FUND
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INVESTMENT PROFILE All Data as of March 31, 2000
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INVESTMENT COMMENTARY
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After a great rally at the end of the year, the fund continued its positive
performance, returning 49.94% for the fiscal year ended March 31, 2000. The
fund's benchmark, the S&P 500 Index returned 17.94% for the fiscal year ended
March 31, 2000.
At the beginning of July, non-growth oriented companies typically found in the
consumer staples, basic materials and consumer cyclicals sectors had a strong
run. To the benefit of the fund, this run was short-lived, and in the late
summer the technology and telecommunications sectors started to come back. The
fund increased its weight in telecommunications and kept its technology weight
the same; however, when the overweight in technology became too high relative to
the S&P 500 Index, the fund's management decided to pull back on the overweight
in technology. Had the fund been more overweighted in technology, the fund's
return would have been higher for the period, but in the interest of keeping the
portfolio risk-controlled, the fund's management believed the risk was too
great.
Looking ahead, we believe the fund is well positioned to take advantage of the
opportunities in the energy sector with the demand for natural gas on the rise.
As fund management is always monitoring risk, in the upcoming months, management
currently intends to cut back on some of the holdings with higher weights in the
technology sector that have had historically strong returns. Additionally, as a
result of upcoming Federal Reserve policies, investors could experience
increased market volatility in the upcoming months.
<TABLE>
<CAPTION>
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at NAV at POP
PERFORMANCE UPDATE 1Q00 Calendar YTD One Year Five Year Ten Year Since Inception
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<S> <C> <C> <C> <C> <C> <C>
Quant Growth and Income Fund 6.37% 6.37% 49.94% 30.06% 20.15% 18.88% (5/9/85)
S&P 500 Index 2.29% 2.29% 17.94% 26.76% 18.84% 18.09%
</TABLE>
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VALUE OF $10,000 INVESTED IN QUANT GROWTH AND INCOME (QGI) ORDINARY SHARES VS.
S&P 500
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[GRAPH]
QGI S&P 500
10,000 10,000
10,248 9,991
13,116 13,022
13,495 14,012
15,601 15,422
15,499 15,625
20,063 21,497
23,838 26,432
32,580 35,250
42,202 45,324
59,556 54,868
62,716 56,125
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FUND INFORMATION
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Ticker Symbol USBOX (Ordinary)
QGIAX (Institutional)
Number of Companies 57
Price to Book 7.2
Price to Earnings 34.7
Assets Under Management $99 million
The S&P 500 Index is an unmanaged index of stocks chosen by Standard & Poors for
their size and industry characteristics. It is widely recognized as
representative of the general market for stocks in the United States. Investment
returns assume the reinvestment of dividends paid on stocks comprising the
Index.
Past performance is no guarantee of future results. This information may be used
only when preceded or accompanied by a prospectus. Returns at Public Offering
Price ("POP") reflect the average annual returns of Ordinary Shares of the fund,
which carry a 12b-1 fee of 50bp and include the effects of a 1% redemption fee.
The value of $10,000 chart reflects the effects of the redemption fee.
Institutional shares of the fund are available to clients of some financial
advisors without a 12b-1 or redemption fee. The one year, five year and since
inception (3/21/91) returns for Institutional Shares are 52.32%, 30.99% and
21.29%, respectively. Returns at the year to date and first quarter are
calculated at Net Asset Value ("NAV") and do not take into account the
redemption fee of 1%. Accordingly, returns at NAV would be lower if such fees
were deducted. Share prices will vary, and shares may be worth more or less than
their original cost at the time of sale. The investment return and principal
value of an investment will fluctuate. The fund's portfolio is subject to
change. Distributed by U.S. Boston Capital Corporation.
<PAGE>
QUANT GROWTH AND INCOME FUND
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INVESTMENT PROFILE All Data as of March 31, 2000
[PHOTO]
Steve Esielonis
The Quant Growth and Income Fund, created in 1985, 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 dividends. The fund
is designed to be a core common stock portfolio that can be utilized either
alone or in conjunction with more narrowly differentiated strategies. The fund
employs a conservative equity investment strategy that makes it well suited for
longer term investors seeking a domestic stock fund.
Investment Process The fund's investment process begins with a top-down ranking
of industries based on forecasts of their relative attractiveness. Strict limits
are placed on the concentration of securities that may be purchased within any
economic and industry sector to avoid undue risk. In addition, risk controls
restrict the percentage of the fund's assets that can be invested in the stock
of a particular company.
Buy and Sell Discipline Individual investments are selected from among a
universe of over 1,000 companies. Stocks within the portfolio are chosen based
on rankings produced by a multi-factor quantitative model. Revisions to a
company's earnings estimates, which are published by financial analysts, are
closely followed and trends are quantified daily to arrive at a forecast of the
actual earnings of the company for the quarter. Each company's stock is then
evaluated on the basis of historic earnings, dividends and asset values, which
are compared to the current price of 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 fund is managed by a team of analysts and the portfolio manager,
Steve Esielonis, at State Street Global Advisors located in Boston,
Massachusetts.
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TOP TEN HOLDINGS
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Company % Total Net Assets
Cisco Systems Inc. 4.0
Sun Microsystems Inc. Co. 3.7
Microsoft Corporation 3.7
General Electric Co. 3.4
Oracle Corporation 2.9
Intel Corporation 2.8
Applied Materials Inc. 2.7
Morgan Stanley Dean Witter Co. 2.6
Nokia Corporation 2.5
Sprint PCS Corporation 2.5
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SECTOR ALLOCATION
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[GRAPH]
Consumer Cyclicals 8%
Consumer Staples 3%
Energy 8%
Financials 14%
Health Care 12%
Transportation 2%
Technology 37%
Cash and Other Assets (Net) 1%
Communications 15%
<PAGE>
QUANT INTERNATIONAL EQUITY FUND
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INVESTMENT PROFILE All Data as of March 31, 2000
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INVESTMENT COMMENTARY
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As in the United States and emerging markets, the dominant themes of technology
and growth driving returns continued to propel the stock market performance in
the developed markets over the course of the fiscal year ended March 31, 2000.
The continued divergence of growth stocks outperforming value stocks was the
main contributor to the fund's underperformance versus its benchmark, the Morgan
Stanley Europe, Australasia and Far East (EAFE) Index. Some of the
telecommunications companies that were held by the fund (Ericsson, France
Telecom, Nokia, Vodafone) did well over the fiscal year. Over the past few
months, the fund's management has increased its weight in telecommunications to
be more in line with the benchmark due to the prospects for continued growth in
this sector.
Upon examining stock selection for the period ended March 31, 2000, we feel that
international management practices have changed. Companies in Japan are facing
global competition, and, as a result, are starting to focus more on
profitability and return on equity, while starting to migrate away from the
"employment for life" philosophy. In the banking industry, more consolidation is
taking place among financial institutions as they seek to pool assets and
ultimately cut costs. These corporate changes caused strong price fluctuation in
the developed markets over the course of the fiscal year.
As indicated, the international drivers of performance - technology and growth
over the fiscal year, were identical to those drivers of performance in the U.S.
stock markets. Historically, the drivers for international and domestic returns
have not been highly correlated. Looking ahead, we will continue to monitor our
portfolio holdings in an effort to seek out favorable returns in a risk-
controlled environment while also seeking to take advantage of the changing
international economic environment.
<TABLE>
<CAPTION>
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at NAV at POP
PERFORMANCE UPDATE 1Q00 Calendar YTD One Year Five Year Ten Year Since Inception
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<S> <C> <C> <C> <C> <C> <C>
Quant International Equity Fund -3.23% -3.23% 11.80% 5.89% 3.40% 4.24% (7/31/87)
MSCI EAFE Index -0.11% -0.11% 25.09% 12.39% 9.38% 8.10%
</TABLE>
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VALUE OF $10,000 INVESTED IN QUANT INTERNATIONAL EQUITY ("QIE") ORDINARY SHARES
VS. EAFE
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[GRAPH]
QIE EAFE
10,000 10,000
7,773 8,546
8,560 10,710
7,323 9,417
9,703 12,496
10,581 13,470
10,940 14,904
11,521 15,820
11,351 16,338
12,635 19,607
14,439 24,912
13,881 24,884
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FUND INFORMATION
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Ticker Symbol USBFX (Ordinary)
QIEAX (Institutional)
Number of Companies 123
Price to Book 7.27
Price to Earnings 26.9
Assets Under Management $20 million
The Morgan Stanley Capital International Europe, Australasia, and Far East
("EAFE") Index is an unmanaged index comprised of stocks in countries other than
the United States. It is widely recognized as representative of the general
market for developed foreign markets.
Past performance is no guarantee of future results. This information may be used
only when preceded or accompanied by a prospectus. Returns at Public Offering
Price ("POP") reflect the average annual returns of Ordinary Shares of the fund,
which carry a 12b-1 fee of 50bp and include the effects of a 1% redemption fee.
The value of $10,000 chart reflects the effects of the redemption fee.
Institutional shares of the fund are available to clients of some financial
advisors without a 12b-1 or redemption fee. The one year, five year, and since
inception (4/25/90) returns for Institutional Shares are 13.33%, 6.55% and
4.55%, respectively. Returns at the year to date and first quarter are
calculated at Net Asset Value ("NAV") and do not take into account the
redemption fee of 1%. Accordingly, returns at NAV would be lower if such fees
were deducted. Share prices will vary, and shares may be worth more or less than
their original cost at the time of sale. The investment return and principal
value of an investment will fluctuate. The fund's portfolio is subject to
change. Distributed by U.S. Boston Capital Corporation.
<PAGE>
QUANT INTERNATIONAL EQUITY FUND
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INVESTMENT PROFILE All Data as of March 31, 2000
[PHOTO]
Brad Greenleaf
The Quant International Equity Fund*, provides investors with the opportunity to
participate in 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 have historically not been highly correlated to those of the United
States stock markets.
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 may also invest a
portion of its assets in emerging markets. This diversification within the fund,
coupled with risk controls that limit the amount of assets that can be invested
in certain countries, like Japan, help reduce the effect that the performance of
any single foreign country may have on the fund's return.
Buy and Sell Discipline The investment process for the fund relies on
sophisticated quantitative computer models. The fund utilizes specific models
for each individual country. In some countries, however, the fund's models may
emphasize growth or value characteristics, depending on which factors have been
the predominate predictors of share appreciation in a particular 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 The fund is managed by Independence International Associates, Inc., a
Boston, Massachusetts money manager that specializes in the management of
international equity portfolios. The portfolio manager for the fund is Brad
Greenleaf.
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TOP TEN HOLDINGS
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Company % Total Net Assets
Vodafone Airtouch 4.2
Deutsche Telekom 3.1
Nokia Corporation 2.8
Royal Dutch Petroleum 2.7
Ericsson 2.6
Honda Motor 2.5
Toyota Motor 2.4
Zuerich Allied 2.2
Total Fina Elf 2.1
Canon 2.0
*Investing in foreign securities may involve certain additional risks, including
exchange rate fluctuations, less liquidity, greater volatility and less
regulation.
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COUNTRY ALLOCATION
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[GRAPH]
France 9%
Australia 2%
Germany 9%
Belguim 2%
Denmark 2%
Finland 3%
Hong Kong 2%
Italy 4%
Japan 28%
Ireland 1%
U.K. 18%
Switzerland 4%
Sweden 3%
Spain 3%
Singapore 2%
Portugal 2%
Netherlands 5%
Austria 1%
<PAGE>
QUANT EMERGING MARKETS FUND
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INVESTMENT PROFILE All Data as of March 31, 2000
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INVESTMENT COMMENTARY
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The story for emerging markets for the fiscal year ended March 31, 2000 is a
simple one: rebound and recovery. The fund's benchmark, the Morgan Stanley
Capital International Emerging Markets Free (MSCI EMF) Index, was up over 50%
for the fiscal year ended March 31, 2000.
The majority of this return is due to the overall resilience of emerging
markets. More recently, the greatest impact in emerging markets has been very
similar to the story here in the United States: the technology and
telecommunications sectors. Returns overseas for the first part of the year show
that telecommunications and technology stocks are significantly ahead of the
indexes in all regions. As of the end of the quarter, the fund's benchmark
returned 2.42% and technology stocks offset many shortfalls in other sectors
comprising the index (financials, durable goods and materials returned -5%, -17%
and -7% respectively). Many emerging market technology companies have recently
made investments in smaller companies developing Internet and network equipment.
Additionally, one of the largest markets for Internet services is in China,
where the fund has some exposure in the technology sector.
The technology sector was not the only area that impacted the fund's
performance; country selection also played an important role. Countries where
currency risks have subsided and interest rates have fallen experienced the
highest returns (Turkey and Russia). Other Mid-Eastern region countries that had
strong returns were Israel and the Czech Republic. Eighteen markets returned
over 40%, and the recovery is still underway.
Emerging markets still seem quite attractive relative to developed markets where
investor expectations reflect analysts' forecasts of earnings. Accordingly, we
believe the coming year offers ample opportunities for the fund to excel.
<TABLE>
<CAPTION>
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at NAV at POP
PERFORMANCE UPDATE 1Q00 Calendar YTD One Year Five Year Since Inception
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Quant Emerging Markets Fund -0.11% -0.11% 41.31% 5.16% -0.52% (10/3/94)
Morgan Stanley EMF Free Index 2.42% 2.42% 51.59% 5.23% -0.15%
</TABLE>
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VALUE OF $10,000 INVESTED IN QUANT EMERGING MARKETS (QEM) ORDINARY SHARES VS.
MSCI EMF FREE
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[GRAPH]
QEM EMF
10,000 10,000
8,213 8,558
7,469 7,496
8,211 8,267
8,036 8,210
8,015 8,095
8,644 8,595
9,046 8,946
8,746 8,516
8,715 8,563
9,531 9,283
10,151 10,067
9,541 9,159
7,912 7,551
7,843 8,098
5,880 6,179
5,673 4,911
6,200 5,788
6,876 6,541
8,506 8,137
8,245 7,718
9,827 9,682
9,718 9,916
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FUND INFORMATION
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Ticker Symbol QFFOX (Ordinary)
QEMAX (Institutional)
Number of Companies 126
Assets Under Management $16 million
The Morgan Stanley Capital International Emerging Markets Free ("EMF Free")
Index is an unmanaged index comprised in stocks located in countries other than
the United States. It is widely recognized as representative of the general
market for emerging markets. Investment returns assume the reinvestment of
dividends paid on stocks comprising the Index.
Past performance is no guarantee of future results. This information may be used
only when preceded or accompanied by a prospectus. Returns at Public Offering
Price ("POP") reflect-the average annual returns of Ordinary Shares of the fund,
which carry a 12b-1 fee of 50bp and include the effects of a 1% redemption fee.
The value of $10,000 chart reflects the effects of the redemption fee.
Institutional shares of the fund are available to clients of some financial
advisors without a 12b-1 or redemption fee. The one year and since inception
(4/2/96) returns for Institutional Shares are 43.55% and 3.47%, respectively.
Returns at the year to date and first quarter are calculated at Net Asset Value
("NAV") and do not take into account the redemption fee of 1%. Accordingly,
returns at NAV would be lower if such fees were deducted. Share prices will
vary, and shares may be worth more or less than their original cost at the time
of sale. The investment return and principal value of an investment will
fluctuate. The fund's portfolio is subject to change. Distributed by U.S. Boston
Capital Corporation.
<PAGE>
QUANT EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 2000
[PHOTO]
Dennis Fogarty
The Quant 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.
Moreover, continuing improvements in infrastructure are likely to make these
countries increasingly productive in years to come.
Investment Process 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. 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.
Buy and Sell Discipline 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 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 fund is managed by Independence International Associates, Inc., a
Boston, Massachusetts money manager that specializes in the management of
international equity portfolios. The portfolio manager for the fund is Dennis
Fogarty.
- --------------------------------------------------------------------------------
TOP TEN HOLDINGS
- --------------------------------------------------------------------------------
Company % Total Net Assets
Telefonos De Mexico 4.2
Samsung Electronic 3.7
Telefonica De Argentina 2.6
Bezeq Israel Telecommunication 2.3
Reliance Industries Ltd. 2.2
Groupo Televisa SA 2.0
Turkiye is Bankasi 1.7
Caemi Mineracao E Metalurgia 1.7
National Bank of Greece 1.6
Usiminas Usi Sd Mg 1.6
*Investing in foreign securities may involve certain additional risks, including
exchange rate fluctuations, less liquidity, greater volatility and less
regulation. The risks may be magnified for emerging markets.
- --------------------------------------------------------------------------------
COUNTRY ALLOCATION
- --------------------------------------------------------------------------------
[GRAPH]
Argentina 6%
Brazil 9%
Chile 6%
Greece 7%
Hungary 2%
India 7%
Israel 5%
Republic of Korea 9%
Hong Kong 3%
Turkey 7%
Thailand 4%
Taiwan 7%
South Africa 7%
Poland 5%
Phillipines 2%
Mexico 9%
Cash and Other Assets (Net) 1%
China 1%
<PAGE>
QUANT FOREIGN VALUE FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 2000
- --------------------------------------------------------------------------------
INVESTMENT COMMENTARY
- --------------------------------------------------------------------------------
Value stocks continue to struggle as the market's growth surge continues into
2000. The fund's strategy continues to move from a small and medium size company
concentration to a slightly larger company concentration in an effort to seek
out companies with strong growth prospects and outstanding value.
Investments in technology-related companies helped the fund's return over the
course of the fiscal year ended March 31, 2000. Draka Holdings was up for the
one-year period ended March 31, 2000. Investments in Total Access Communication,
the second largest cellular telephone company in Thailand, and Arisawa
Manufacturing, who manufacture advanced woven materials for components of LCD
screens in Japan, were also beneficial to the portfolio.
Although the fund generally invests in markets comprising the Morgan Stanley
Europe, Australasia and Far East (EAFE) Index, it may also invest a portion of
its assets in emerging markets.
Towards the end of 1999, the fund added two positions in the Republic of Korea,
an emerging market, to increase the overall exposure to technology.
South Africa, also an emerging market, represented over 7% of the portfolio for
the fiscal year ended March 31, 2000. Exposure in the United Kingdom, which
comprised approximately 12% of the fund's portfolio, hurt performance for most
of the fiscal year but picked up toward the end. Additionally, the main currency
of Europe, the Euro, declined throughout the fiscal year, and the fund's
portfolio was over 60% invested in European countries.
However, with constant rotations and market cycles, we are seeing indications
that value is slowly trying to re-establish its place in the market. We continue
to remain optimistic that the fund's portfolio is well positioned to take
advantage of an environment where value stocks return to favor.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
at NAV at POP
PERFORMANCE UPDATE 1Q00 Calendar YTD One Year Since Inception
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Quant Foreign Value Fund -4.54% -4.54% 11.05% -3.75% (5/15/98)
MSCI EAFE Index -0.11% -0.11% 25.09% 16.87%
</TABLE>
- --------------------------------------------------------------------------------
VALUE OF $10,000 INVESTED IN QUANT FOREIGN VALUE (QFV) ORDINARY SHARES VS. EAFE
- --------------------------------------------------------------------------------
[GRAPH]
QFV EAFE
10,000 10,000
8,610 10,192
7,880 8,743
8,665 10,548
8,384 10,696
9,417 10,975
9,078 11,457
9,851 13,403
9,310 13,388
- --------------------------------------------------------------------------------
FUND INFORMATION
- --------------------------------------------------------------------------------
Ticker Symbol QFVOX (Ordinary)
N/A (Institutional)
Number of Companies 38
Price to Book 1.81
Price to Earnings 20.7
Assets Under Management $15 million
The Morgan Stanley Capital International Europe, Australasia, and Far East
("EAFE") Index is an unmanaged index comprised of stocks in countries other than
the United States. It is widely recognized as representative of the general
market for developed foreign markets.
Past performance is no guarantee of future results This information may be used
only when preceded or accompanied by a prospectus. Returns at Public Offering
Price ("POP") reflect the average annual returns of Ordinary Shares of the fund,
which carry a 12b-1 fee of 25bp and a 1% redemption fee. The value of $10,000
chart reflects the effects of the redemption fee. Institutional Shares of the
fund are available to clients of some financial advisors without a 12b-1 or
redemption fee. The one year and since inception (12/18/98) returns for
Institutional Shares are 12.37% and 8.88%, respectively. Returns at the year to
date and first quarter are calculated at Net Asset Value ("NAV") and do not take
into account the redemption fee of 1%. Accordingly, returns at NAV would be
lower if such fees were deducted. Share prices will vary, and shares may be
worth more or less than their original cost at the time of sale. The investment
return and principal value of an investment will fluctuate. The fund's portfolio
is subject to change. Distributed by U.S. Boston Capital Corporation.
<PAGE>
QUANT FOREIGN VALUE FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE All Data as of March 31, 2000
[PHOTO]
Bernard R. Horn, Jr.
The Quant 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 broad-based stock indices.
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 may also
invest a portion of its assets in emerging markets. The 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, helps
reduce 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 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 companies 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.
Management The fund is managed by Bernard R. Horn, Jr., President of Polaris
Capital Management, Inc., a Boston, Massachusetts 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
- --------------------------------------------------------------------------------
Company % Total Net Assets
Draka Holding 5.3
V-Tech Holdings Ltd. 3.9
Union Electrica Fenosa 3.5
Kon Boskalis Westminster 3.4
Kesko OYJ 3.3
Kone OYJ 3.2
Sanlam Limited 3.0
Banco Bilbao Vizcaya Argentaria 3.0
A. Friedrich Flender 2.9
Sappi Ltd. 2.9
*Investing in foreign securities may involve certain additional risks, including
exchange rate fluctuations, less liquidity, greater volatility and less
regulation.
- --------------------------------------------------------------------------------
COUNTRY ALLOCATION
- --------------------------------------------------------------------------------
[GRAPH]
Austria 2%
Germany 7%
Denmark 2%
Spain 6%
Finland 7%
Indonesia 1%
France 6%
United Kingdom 12%
Hong Kong 4%
Italy 4%
Canada 2%
Cash and Other Assets (Net) 12%
South Africa 8%
Thailand 3%
Netherlands 15%
Republic of Korea 4%
Japan 5%
<PAGE>
QUANT 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
Independence International Associates, Inc.
53 State Street
Boston, MA 02109
Polaris Capital Management, Inc.
125 Summer Street
Boston, MA 02110
Columbia Partners, LLC, Investment Management
1775 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
State Street Global Advisors
2 International Place
Boston, MA 02110
Distributor
U.S. Boston Capital Corporation
55 Old Bedford Road
Lincoln, MA 01773
Custodian
Investors Fiduciary Trust Company
801 Pennsylvania Avenue
Kansas City, MO 64105
Transfer Agent
Quantitative Institutional Services
55 Old Bedford Road
Lincoln, MA 01773
Independent Accountants
PricewaterhouseCoopers LLP
1055 Broadway, 10th Floor
Kansas City, MO 64105
[LOGO OF QUANT FUNDS]
QUANT 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.
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS--Continued
<TABLE>
<CAPTION>
International Equity Emerging Markets Foreign Value
Year ended Year ended Year ended Year ended Year ended Year ended
March 31, 2000 March 31, 1999 March 31, 2000 March 31, 1999 March 31, 2000 March 31, 1999**
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations:
Net investment income
(loss) $ (69,216) $ 40,721 $ 1,994 $ 97,849 $ 52,861 $ 10,203
Net realized gain
(loss) on investments,
foreign denominated
assets, liabilities,
currency and written
options 2,925,169 51,083 480,186 (153,778) 206,133 (298,274)
Unrealized appreciation
(depreciation) of
investments and foreign
denominated assets,
liabilities and
currency (232,894) (1,703,373) 3,923,901 (1,311,380) 720,112 (549,162)
--------------- ---------------- ----------- ----------- ----------- ----------
Net increase (decrease)
in net assets resulting
from operations 2,623,059 (1,611,569) 4,406,081 (1,367,309) 979,106 (837,233)
Distributions to
shareholders from:
Net investment income
Ordinary Shares -- (47,429) -- (62,864) (440,249) (10,203)
Institutional Shares -- (5,481) -- (15,751) (2,829) --
Distributions in excess
of net investment
income
Ordinary Shares (524,319) (9,143) (20,725) -- (34,588) (9,526)
Institutional Shares (47,894) (1,057) (9,394) -- (222) --
Net realized gains
Ordinary Shares (763,209) -- -- -- --
Institutional Shares (58,039) -- -- -- --
Distributions in excess
of net realized gains
Ordinary Shares -- -- -- -- -- --
Institutional Shares -- -- -- -- -- --
Return of capital
Ordinary Shares -- -- -- (26,927) -- --
Institutional Shares -- -- -- (6,747) -- --
--------------- ---------------- ----------- ----------- ----------- ----------
(1,393,461) (63,110) (30,119) (112,289) (477,888) (19,729)
--------------- ---------------- ----------- ----------- ----------- ----------
Fund share transactions
(Note 10) (5,418,070) (8,384,309) 1,297,698 1,126,259 6,418,141 8,736,341
--------------- ---------------- ----------- ----------- ----------- ----------
Increase (decrease) in
net assets (4,188,472) (10,058,988) 5,673,660 (353,339) 6,919,359 7,879,379
Net assets beginning of
year 23,851,094 33,910,082 9,889,311 10,242,650 7,879,379 --
--------------- ---------------- ----------- ----------- ----------- ----------
Net assets end of year* $ 19,662,622 $ 23,851,094 $15,562,971 $ 9,889,311 $14,798,738 $7,879,379
=============== ================ =========== =========== =========== ==========
* Includes
undistributed net
investment income
(loss) of $ (128,065) $ (27,158) $ 2,634 $ (11,691) $ 1,193 $ (18,051)
</TABLE>
**From the commencement of operations on May 15, 1998.
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
12
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT SMALL CAP FUND
- --------------------------------------------------------------------------------
COMMON STOCK--96.4%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
APPAREL & TEXTILES--0.7%
Madden (Steven) Ltd. (a) 31,370 $ 596,030
-----------
BANKS--1.0%
Wilmington Trust Corporation 16,205 787,968
-----------
BROADCASTING--1.7%
Entercom Communications (a) 24,800 1,264,800
Regent Communications Inc. (a) 9,050 111,994
-----------
1,376,794
-----------
BUSINESS SERVICES--5.8%
Anixter International Inc. (a) 35,695 994,998
Henry (Jack) & Associates 45,730 1,686,294
TMP Worldwide Inc. (a) 26,060 2,026,165
-----------
4,707,457
-----------
CHEMICALS--1.8%
Geon Company 10,075 216,612
Georgia Gulf Corporation 10,075 261,950
Grace (W.R.) & Company (a) 20,145 255,590
Millennium Chemicals Inc. 34,840 696,800
-----------
1,430,952
-----------
COMPUTERS & BUSINESS EQUIPMENT--3.8%
CacheFlow Inc. (a) 8,390 994,215
Comverse Technology Inc. (a) 10,925 2,064,825
-----------
3,059,040
-----------
DRUGS & HEALTHCARE--8.3%
Apria Healthcare Group Inc. (a) 63,430 915,770
Cell Therapeutics Inc. (a) 10,615 248,789
Ilex Oncology Inc. (a) 26,011 1,092,462
Medicis Pharmaceutical Corporation (a) 23,645 945,800
Mid Atlantic Medical Services Inc. (a) 93,410 864,043
NPS Pharmaceuticals Inc. (a) 32,065 482,979
Orthodontic Centers of America Inc. (a) 62,690 1,175,438
Sybron International Corporation (a) 33,350 967,150
-----------
6,692,431
-----------
ELECRICAL EQUIPMENT--4.5%
Amphenol Corporation (a) 11,500 1,175,875
Cable Design Technologies (a) 72,265 2,452,493
-----------
3,628,368
-----------
ELECTRONICS--11.3%
Dallas Semiconductor Corporation 33,340 1,171,068
Digital Microwave Corporation (a) 17,495 592,643
Exar Corporation (a) 35,077 2,510,198
Gentex Corporation (a) 27,155 1,006,432
LSI Logic Corporation (a) 29,610 2,150,426
Sensormatic Electronics Corporation (a) 74,740 1,676,979
-----------
9,107,746
-----------
FOOD & BEVERAGE--1.1%
Suiza Foods Corporation (a) 21,295 857,124
-----------
GAS EXPLORATION--2.1%
Chesapeake Energy Corporation (a) 117,316 381,277
Glogal Marine Inc. (a) 52,560 1,333,710
-----------
1,714,987
-----------
HOTELS & RESTAURANTS--1.2%
CEC Entertainment Inc. (a) 36,195 981,789
-----------
INSURANCE--1.2%
Annuity & Life Real Estate Holdings 37,810 983,060
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
INTERNET SERVICES--4.1%
Etinuum Inc. (a) 18,935 $ 179,882
LifeMinders.com Inc. (a) 23,255 1,578,433
Modem Media.Poppe Tyson Inc. (a) 36,900 1,194,638
WorldGate Communications Inc. (a) 12,870 386,904
-----------
3,339,857
-----------
INVESTMENT COMPANIES--1.7%
American Capital Strategies Ltd. 32,430 822,911
Southwest Securities Group Inc. 13,535 587,927
-----------
1,410,838
-----------
LODGING & RESTAURANTS--1.6%
Outback Steakhouse Inc. (a) 41,007 1,314,787
-----------
MINING--1.0%
Inco Ltd. (a) 39,855 729,845
-----------
OFFICE FURNISHINGS & SUPPLY--2.4%
Reynolds & Reynolds Company 72,415 1,955,205
-----------
PETROLEUM SERVICES--1.8%
Devon Energy Corporation 29,445 1,429,923
-----------
PUBLISHING--1.8%
Scholastic Corporation (a) 27,710 1,494,608
-----------
REAL ESTATE--5.1%
CarrAmerica Realty Corporation 27,355 577,874
Entertainment Properties Trust 14,525 191,549
Kilroy Realty Corporation 10,785 227,159
Pinnacle Holdings Inc. (a) 43,015 2,322,810
SL Green Realty Corporation 31,400 745,750
-----------
4,065,142
-----------
RETAIL TRADE--2.4%
Chico's Fashions Inc. (a) 95,795 1,624,025
Genesco Inc. (a) 21,345 280,153
-----------
1,904,178
-----------
SOFTWARE--14.8%
Engage Technologies Inc. (a) 23,270 1,775,792
Freeshop.com Inc. (a) 68,875 1,343,062
Informix Corporation (a) 72,970 1,235,929
NVIDIA Corporation (a) 34,890 2,947,660
Rational Software Corporation (a) 29,215 2,234,948
Symantec Corporation (a) 16,320 1,226,040
Vignette Corporation (a) 7,380 1,182,645
-----------
11,946,076
-----------
TECHNOLOGY--3.7%
FEI Company (a) 3,880 115,430
Microchip Technology Inc. (a) 23,402 1,538,682
PerkinElmer Inc. 20,637 1,372,360
-----------
3,026,472
-----------
TELECOMMUNICATION SERVICES--11.5%
Clearnet Communications Inc. (a) 50,905 2,096,650
Microcell Telecommunications (a) 34,495 1,530,715
Pac-West Telecommunications Inc. (a) 69,645 2,176,406
Powerwave Technologies Inc. (a) 20,010 2,501,250
Western Wireless Corporation 22,085 1,011,769
-----------
9,316,790
-----------
TOTAL COMMON STOCK
(Cost $49,683,569) 77,857,467
-----------
</TABLE>
- --------------------------------------------------------------------------------
13
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT SMALL CAP FUND--Continued
- --------------------------------------------------------------------------------
SHORT TERM INVESTMENTS--4.1%
<TABLE>
<CAPTION>
Par Value Value
<S> <C> <C>
State Street Bank & Trust Repurchase Agreement
3.50%, 4/3/00, (Dated 3/31/00), Collateralized by
$3,440,000 U.S. Treasury Bond 3.875%, 1/15/09,
Market Value $3,426,443, Repurchase Proceeds
$3,359,980 (Cost $3,359,000). $3,359,000 $ 3,359,000
-----------
TOTAL INVESTMENTS--100.5%
(Cost $53,042,569) (b) 81,216,467
OTHER ASSETS & LIABILITIES (NET)--(0.5)% (426,772)
-----------
NET ASSETS--100% $80,789,695
===========
</TABLE>
(a) Non-income producing security.
(b) At March 31, 2000, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $53,302,693 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments in
which there is an excess of value over tax cost $29,696,880
Aggregate gross unrealized depreciation for all investments in
which there is an excess of tax cost over value (1,783,106)
-----------
Net unrealized appreciation $27,913,774
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
14
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT MID CAP FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMMON STOCK--91.5%
Shares Value
<S> <C> <C>
AIR TRAVEL--2.0%
Delta Air Lines Inc. 7,920 $ 421,740
-----------
ALUMINUM--1.6%
Reynolds Metals Company 4,925 329,359
-----------
AUTOMOBILES--2.1%
Harley-Davidson Inc. 5,600 444,500
-----------
BUSINESS SERVICES--3.7%
Untied Parcel Services Inc. 7,960 501,480
Young & Rubicam Inc. 5,875 276,125
-----------
777,605
-----------
CHEMICALS--1.7%
Martin Marietta Materials Inc. 7,375 350,313
-----------
COMPUTERS &
BUSINESS EQUIPMENT--8.9%
Citrix Systems Inc. (a) 8,835 585,319
Lexmark International Group Inc. (a) 4,180 442,035
Seagate Technology 8,300 500,075
Wind River Systems Inc. (a) 9,255 335,494
-----------
1,862,923
-----------
DRUGS & HEALTHCARE--4.7%
Forest Labs Inc. (a) 5,280 446,160
Shire Pharmaceuticals Group PL (a) (c) 5,990 306,988
Sybron International (a) 8,230 238,670
-----------
991,818
-----------
ELECTRICAL EQUIPMENT--1.9%
Jabil Circuit Inc. (a) 9,150 395,737
-----------
ELECTRONICS--14.5%
Analog Devices Inc. (a) 10,010 806,431
Applied Micro Circuits (a) 4,100 615,256
DII Group Inc. (a) 4,865 550,049
TranSwitch Corporation (a) 6,002 576,942
Vitesse Semiconductor (a) 5,035 484,619
-----------
3,033,297
-----------
ENERGY--2.5%
American Power Conversion (a) 12,305 527,577
-----------
FINANCIAL SERVICES--4.0%
Block (H&R) Inc. 8,875 397,156
Eaton Vance Corporation 10,020 430,234
-----------
827,390
-----------
FOREST PRODUCTS--0.9%
Georgia-Pacific Corporation 4,985 197,219
-----------
GAS & PIPELINE UTILITIES--2.4%
Kinder Morgan Inc. 14,550 501,975
-----------
HOTELS & RESTAURANTS--1.2%
Darden Restaurants Inc. 14,470 257,747
-----------
INVESTMENT COMPANIES--5.6%
Bear Stearns Companies Inc. 8,320 379,600
Donaldson Lufkin & Jenrette Inc. 8,595 444,791
Waddell & Reed Financial Inc. 8,160 345,270
-----------
1,169,661
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
LODGING & RESTAURANTS--1.5%
Outback Steakhouse Inc. (a) 9,445 $ 302,830
-----------
PETROLEUM SERVICES--6.6%
BJ Services Company (a) 7,175 530,053
ENSCO International Inc. 11,790 425,914
Weatherford International Inc. (a) 7,025 414,036
-----------
1,370,003
-----------
PUBLISHING--2.7%
Reader's Digest Association Inc. 8,275 292,728
Valassis Communications Inc. (a) 8,055 268,332
-----------
561,060
-----------
RETAIL TRADE--3.4%
BJ's Wholesale Club (a) 11,465 442,835
Family Dollar Stores Inc. 12,790 266,192
-----------
709,027
-----------
SOFTWARE--9.5%
Inktomi Corporation (a) 2,935 572,325
Network Appliance Inc. (a) 5,545 458,849
Rational Software Corporation (a) 8,755 669,757
RealNetworks Inc. (a) 5,190 295,506
-----------
1,996,437
-----------
TELECOMMUNICATIONS SERVICES--7.3%
Broadwing Inc. (a) 12,040 447,738
Terayon Communications Systems (a) 2,925 599,625
Williams Communications Group (a) 9,235 478,488
-----------
1,525,851
-----------
UTILITIES--2.8%
Montana Power Company 7,305 467,520
ONEOK Inc. 4,455 111,375
-----------
578,895
-----------
TOTAL COMMON STOCK
(Cost $12,117,399) 19,132,964
-----------
</TABLE>
- --------------------------------------------------------------------------------
15
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT MID CAP FUND--Continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHORT TERM INVESTMENTS--12.8%
Par Value Value
<S> <C> <C>
State Street Bank & Trust Repurchase Agreement 3.50%,
4/3/00, (Dated 3/31/00), Collateralized by
$2,745,000 U.S. Treasury Bond 3.875%, 1/15/09,
Market Value $2,734,182, Repurchase Proceeds
$2,677,781 (Cost $2,677,000). $2,677,000 $ 2,677,000
-----------
TOTAL INVESTMENTS--104.3%
(Cost $14,794,399) (b) 21,809,964
OTHER ASSETS & LIABILITIES (NET)--(4.3%) (902,934)
-----------
NET ASSETS--100% $20,907,030
===========
</TABLE>
(a) Non-income producing security.
(b) At March 31, 2000, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $14,805,305 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments in
which there is an excess of value over tax cost $7,125,644
Aggregate gross unrealized depreciation for all investments in
which there is an excess of tax cost over value (120,985)
----------
Net unrealized appreciation $7,004,659
==========
</TABLE>
(c) ADR--American Depository Receipts
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
16
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT GROWTH AND INCOME FUND
- --------------------------------------------------------------------------------
COMMON STOCK--99.3%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
AUTOMOBILES--3.4%
DaimlerChrysler AG Stuttgart 14,500 $ 948,844
Toyota Motor Company (c) 23,000 2,392,000
-----------
3,340,844
-----------
BANKS--2.7%
Bank America Corporation 21,616 1,133,489
Chase Manhattan Corporation 17,900 1,560,656
-----------
2,694,145
-----------
BROADCASTING--1.1%
Comcast Corporation 26,000 1,127,750
-----------
BUSINESS SERVICES--1.6%
United Parcel Services Inc. 25,220 1,588,860
-----------
COMPUTERS & BUSINESS
EQUIPMENT--11.6%
Apple Computer (a) 17,200 2,335,975
Cisco Systems Inc. (a) 50,800 3,927,475
Palm Inc. (a) 18,410 826,149
Sun Microsystems Inc. (a) 38,700 3,626,311
Verisign Inc. 5,000 747,500
-----------
11,463,410
-----------
DOMESTIC OIL--1.6%
Burlington Resources Inc. 42,000 1,554,000
-----------
DRUG & HEALTHCARE--12.4%
Amgen Inc. (a) 31,500 1,933,312
Biogen Inc. (a) 21,500 1,502,313
Biovail Corporation (a) 29,000 1,285,063
Genentech Inc. (a) 13,000 1,976,000
Medtronic, Inc. 37,100 1,908,331
Pfizer, Inc. 40,000 1,462,500
Pharmacia & Upjohn Inc. 21,000 1,244,250
Schering-Plough Corporation 25,950 953,662
-----------
12,265,431
-----------
ELECTRICAL EQUIPMENT--3.4%
General Electric Company 21,500 3,336,531
-----------
ELECTRONICS--6.0%
Applied Materials Inc. (a) 28,200 2,657,850
Intel Corporation 20,700 2,731,106
Infineon Technologies AG (a) (c) 8,946 513,836
-----------
5,902,792
-----------
FINANCIAL SERVICES--7.7%
Capital One Financial 35,100 1,682,606
Citigroup Inc. 22,000 1,304,875
Goldman Sachs Group Inc. 20,105 2,113,538
Morgan Stanley Dean Witter 31,000 2,528,438
-----------
7,629,457
-----------
FOOD & BEVERAGE--2.7%
Coca-Cola Company 25,000 1,173,437
PepsiCo Inc. 44,800 1,548,400
-----------
2,721,837
-----------
HOUSEHOLD PRODUCTS--0.6%
Proctor & Gamble 10,000 562,500
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
INTERNATIONAL OIL--4.1%
Anadarko Petroleum Corporation 17,000 $ 657,688
Apache Corporation 34,000 1,691,500
Barrett Resources (a) 28,700 855,619
BP Amoco PLC (c) 16,468 873,833
-----------
4,078,640
-----------
PETROLEUM SERVICES--2.2%
Royal Dutch Petroleum (d) 22,000 1,266,375
Schlumberger Ltd. 12,000 918,000
-----------
2,184,375
-----------
RETAIL TRADE--4.2%
Home Depot Inc. 34,200 2,205,900
Wal-Mart Stores Inc. 35,400 1,964,700
-----------
4,170,600
-----------
SOFTWARE--8.9%
EMC Corporation (a) 18,200 2,275,000
Microsoft Corporation 34,000 3,612,500
Oracle Corporation (a) 37,000 2,888,313
-----------
8,775,813
-----------
TELECOMMUNICATION SERVICES--25.1%
ALLTEL Corporation 19,800 1,248,637
AT&T Corporation 29,400 1,653,750
Cable & Wireless PLC (c) 25,000 1,400,000
Global Telesystems Group Inc. (a) 49,000 1,004,500
Lucent Technologies Inc. 15,376 934,092
MCI WorldCom Inc. (a) 37,200 1,685,625
Motorola, Inc. 13,600 1,936,300
Nokia Corporation (c) 11,500 2,498,375
Nortel Networks 18,000 2,268,000
QUALCOMM Inc. (a) 11,200 1,672,300
Sonera Corporation PLC (a) (c) 31,400 2,084,175
Sprint PCS Corporation (a) 37,200 2,429,625
Tele 1 Europe Holding AB (a) (c) 12,198 233,287
Vodafone AirTouch PLC (c) 28,250 1,569,641
Voicestream Wireless Corporation (a) 16,500 2,125,406
-----------
24,743,713
-----------
TOTAL COMMON STOCK
(Cost $64,343,204) (b) 98,140,698
OTHER ASSETS & LIABILITIES (NET)--0.7% 690,238
-----------
NET ASSETS--100% $98,830,936
===========
</TABLE>
(a) Non-income producing security.
(b) At March 31, 2000, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $64,438,606 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments in
which there is an excess of value over tax cost $36,931,139
Aggregate gross unrealized depreciation for all investments in
which there is an excess of tax cost over value (3,229,047)
-----------
Net unrealized appreciation $33,702,092
===========
</TABLE>
(c) ADR--American Depository Receipts
(d) GDR--Global Depository Receipts
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
17
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
COMMON STOCK--98.1%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
AUSTRALIA--1.6%
CSR Limited (c) 23,500 $ 49,319
Fosters Brewing Group 44,200 109,651
News Corporation 2,500 34,907
Pioneer International Ltd. 27,400 74,621
Telstra Corporation 9,700 44,715
-----------
313,213
-----------
AUSTRIA--0.7%
Austria Tabak 3,400 130,227
-----------
BELGIUM--2.0%
Fortis B 9,700 248,924
KBC Bank Verzekerin NPV 700 25,136
Solvay 800 57,453
Suez Lyonn Eaux 400 4
Union Miniere 1,800 62,394
-----------
393,911
-----------
DENMARK--2.1%
Danisco 700 22,410
Novo Nordisk AS 1,300 175,497
Tele Danmark A/S 2,450 220,496
-----------
418,403
-----------
FINLAND--2.8%
Nokia AB OY 2,600 550,208
-----------
FRANCE--9.0%
AXA-UAP 1,497 212,294
Banque Nationale De Paris 1,112 87,846
Carrefour 432 55,389
France Telecom 2,059 354,887
Lafarge 899 76,701
LVMH Moet Hennessy 126 52,749
Peugeot SA 373 80,720
Pinault Printemps Redo 747 138,480
Schneider Electric 600 38,321
SGS-Thomson Microelectronics 1,214 223,193
Soc. Generale 173 34,523
Total Fina Elf 2,810 421,097
-----------
1,776,200
-----------
GERMANY--9.0%
Bayerische Hypo-Und Vereins 2,782 172,488
Bilfinger & Berger 5,750 83,304
Brau Und Brunnen (a) 700 24,800
Continental AG 2,150 39,116
Degussa Huls AG (c) 4,550 140,291
Deutsche Telekom 7,600 611,300
EM TV Merchandising 1,901 156,182
Karstadt Quelle AG 6,250 191,570
Siemens AG NPV (Regd) 2,050 294,427
Thyssen Krupp AG 2,593 63,935
-----------
1,777,413
-----------
HONG KONG--2.0%
Cathay Pacific Air 128,000 192,331
Hang Seng Bank 3,900 34,059
Sun Hung Kai Properties 11,000 96,416
Swire Pacific 14,000 72,099
-----------
394,905
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
IRELAND--1.0%
Waterford Wedgewood 220,400 $ 200,492
-----------
ITALY--4.1%
Banco Di Roma 10,000 11,041
ENI SPA (c) 8,000 40,064
Istituto Banco Sao Paolo IMI SPA 22,943 314,377
Montedison SPA (c) 49,400 86,328
Sirti SPA 92,000 194,689
Telecom Italia Mob (c) 12,500 153,447
-----------
799,946
-----------
JAPAN--27.6%
Acom Company 1,800 194,789
Asahi Bank 6,000 33,604
Bank of Tokyo-Mitsubishi 9,000 128,603
Bank of Yokohama 2,000 8,104
Bridgestone Corporation 3,000 66,186
Canon Inc. 9,000 390,104
Daiichi Pharmaceutical Company 1,000 15,487
Daito Trust Construction 3,200 54,765
Daiwa Securities Group Inc. 6,000 112,794
Honda Motor Company 12,000 495,592
Industrial Bank of Japan 4,000 36,546
Kansai Electric Power (c) 6,000 89,651
Kyocera Corporation 300 50,144
Mabuchi Motor Company 2,100 222,958
Mitsubishi Corporation 26,000 235,777
Mitsui Mining & Smelting (c) 12,000 73,170
Murata Manufacturing Company 1,000 243,023
Nippom Telephone & Telegraph Docomo 3 123,021
Nippon Telephone & Telegraph 13 206,399
Nomura Securities 3,000 97,891
Orix Corporation 2,160 312,434
Promise Company 700 53,933
Rohm Company 1,000 347,733
Sakura Bank 9,000 68,465
Sekisui House 17,000 155,817
Softbank Corporation 200 178,250
Sony Corporation, New Shares (a) 1,000 142,210
Sony Corporation 1,000 141,236
Taisho Pharmaceutical Company 3,000 103,443
Takeda Chemical Industries 1,000 71,105
Takefuji Corporation 1,000 107,145
Tohuku Electric Power (c) 11,200 143,457
Tokyo Electric Power (c) 11,700 256,417
Toyota Motor Corporation 9,000 470,754
-----------
5,431,007
-----------
NETHERLANDS--4.7%
ABN-AMRO Holdings NV 7,300 162,800
ASM Lithography HL (a) 400 44,698
ING Groep NV 400 21,679
Philips Elec (Kon) 1,000 168,146
Royal Dutch Petroleum 9,000 525,781
-----------
923,104
-----------
NEW ZEALAND--0.5%
Fletcher Challenge (Paper) 48,000 32,624
Fletcher Challenge (Building) 64,900 70,189
-----------
102,813
-----------
</TABLE>
- --------------------------------------------------------------------------------
18
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT INTERNATIONAL EQUITY FUND--Continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMMON STOCK--Continued
Shares Value
<S> <C> <C>
PORTUGAL--1.9%
Brisa Auto Estrada 37,392 $ 275,338
Portucel Industria 10,300 69,040
Portugal Telecom 2,600 33,361
-----------
377,739
-----------
SINGAPORE--1.1%
Neptune Orient Lines (a) 23,000 20,288
United Overseas Bank 32,000 196,285
-----------
216,573
-----------
SPAIN--2.8%
Banco Santander Central Hisp 3,600 38,712
Endesa SA 9,400 215,753
Faes Esp Prod Quim 2,867 36,265
Grupo Empres Ence 3,600 72,391
Iberdrola SA 14,177 185,030
-----------
548,151
-----------
SWEDEN--3.3%
Ericsson (LM) Telecommunications 5,700 501,425
Netcom AB (a) 1,600 138,155
-----------
639,580
-----------
SWITZERLAND--3.9%
Credit Suisse Group 300 59,735
Nestle SA 20 35,853
Roche Holdings AG 11 119,506
Sairgroup 545 102,453
Zurich Allied AG 870 438,572
-----------
756,119
-----------
UNITED KINGDOM--18.0%
Abbey National PLC 8,500 111,105
Barclays PLC 5,553 148,528
BP Amoco PLC 11,600 107,624
British Aerospace 18,300 101,974
British Telecommunications PLC 15,100 282,478
GKN PLC 2,100 26,079
Glaxo Wellcome 13,100 373,332
Granada Group PLC 5,400 57,860
HSBC Holdings PLC 30,600 360,515
Invensys PLC 26,200 116,692
Lloyds TSB Group PLC 11,500 121,573
Rolls Royce 5,512 17,902
Royal Bank of Scotland Group 10,385 152,939
Smith Kline Beecham 12,800 167,922
Smiths Industries 3,500 42,294
Taylor Woodrow PLC 15,485 35,994
Thames Water 9,100 101,851
United Utilities 36,948 382,362
Vodafone Airtouch PLC 149,600 833,625
-----------
3,542,649
-----------
TOTAL COMMON STOCK
(Cost $16,718,885) 19,292,653
-----------
</TABLE>
<TABLE>
<CAPTION>
SHORT TERM INVESTMENTS--1.8%
Par
Value Value
<S> <C> <C>
State Street Bank & Trust Repurchase Agreement 3.50%,
4/3/00, (Dated 3/31/00), Collateralized by $355,000 U.S.
Treasury Bond 6.125%, 8/15/07, Market Value $352,973,
Repurchase Proceeds $344,100 (Cost $344,000) $344,000 $ 344,000
-----------
TOTAL INVESTMENTS--99.9%
(Cost $17,062,885) (b) 19,636,653
OTHER ASSETS & LIABILITIES (NET)--0.1% 25,969
-----------
NET ASSETS--100% $19,662,622
===========
</TABLE>
(a) Non-income producing security.
(b) At March 31, 2000, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $17,323,731 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments in
which there is an excess of value over tax cost $ 3,297,192
Aggregate gross unrealized depreciation for all investments in
which there is an excess of tax cost over value (984,270)
-----------
Net unrealized appreciation $ 2,312,922
===========
</TABLE>
(c) A portion of security is on loan at 3/31/00. (Note 6)
SECTOR ALLOCATIONS (as a percentage of Total Common Stock)
<TABLE>
- ---------------------------------
<S> <C>
Basic Industries 4.4%
Capital Goods 5.8%
Consumer Basics 6.9%
Consumer Durable Goods 6.1%
Consumer Non-Durable Goods 8.5%
Consumer Services 1.3%
Energy 6.8%
Finance 22.2%
General Business 11.9%
Miscellaneous 2.0%
Shelter 2.3%
Technology 4.5%
Transportation 1.5%
Utilities 15.8%
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
19
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
COMMON STOCK--92.5%
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
ARGENTINA--6.3%
Banco De Galicia 48,552 $ 246,277
Central Puerto SA 45,000 75,186
Irsa Inversiones Y 35,406 110,165
Nobleza Piccardo 25,000 50,024
PC Holdings SA (a) 55,708 95,864
Telefonica De Argentina 102,000 396,971
-----------
974,487
-----------
BRAZIL--3.4%
Brahma (Cia Cervejaria) 21,000 10,889
Centrais Electrobras 3,030,000 53,936
Lojas Americanas (a) 33,407,403 164,975
Sao Carlos Empreendimentos (a) 33,407,403 77,692
Sider Nacional Compania 2,383,000 84,291
Tele Centro Sul PA (a) 11,000,000 120,011
Vale Rio Doce Compania 500 11,484
-----------
523,278
-----------
CHILE--5.5%
Banco Santander Chile (d) 6,000 81,750
Chilectra SA (b) (d) 3,000 52,470
Compania Cervecerias Unidas SA (d) 3,280 81,590
Compania De Telecomunicacion De Chile (d) 4,110 93,503
Embotelladora Andina SA (d) 1,500 19,031
Empresa Nacional De Electricidad (d) 10,539 114,612
Enersis SA (d) 3,000 60,937
Gener SA (d) 4,100 55,350
Laboratorio Chile SA (d) 5,000 113,750
Madeco SA (d) 12,880 141,680
Masisa SA (d) 2,500 35,937
-----------
850,610
-----------
CHINA--1.1%
Huaneng Power International Inc. (d) 6,600 52,800
Guangdon Electric 263,640 126,630
-----------
179,430
-----------
GREECE--6.8%
Alpha Credit Bank 2,810 188,877
Commercial Bank of Greece (a) 2,610 155,277
Intracom (a) 3,000 130,085
National Bank of Greece 3,644 255,878
OTE (Hellenic Telecom) 7,000 199,116
Titan Cement Company 3,200 133,814
-----------
1,063,047
-----------
HONG KONG--3.4%
China Merchants Holdings International 75,000 48,642
China Telecommunications (a) 25,000 219,930
Citic Pacific Ltd. 20,000 120,978
Cosco Pacific Ltd. 90,000 52,591
Legend Holdings 20,000 31,978
Yizheng Chemical Fibre (a) 250,000 47,839
-----------
521,958
-----------
HUNGARY--2.0%
Magyar Olaj-Es Gazipare Resz 5,400 104,949
Matav RT 8,000 70,289
OTP Bank 2,000 107,954
Pannonplast Muanyag 1,000 29,101
-----------
312,293
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
INDIA--7.1%
Bajaj Auto Ltd. (e) 6,000 $ 57,000
ITC Ltd. (e) 4,800 92,160
Larsen & Toubro (e) 6,000 85,500
Mahanagar Telephone Nigam (e) 14,000 196,000
Mahindra & Mahindra (e) 6,000 48,900
Ranbaxy Laboratories Ltd. (e) 9,400 197,400
Reliance Industries Ltd. (b) (e) 15,100 338,618
State Bank of India (e) 9,000 86,850
-----------
1,102,428
-----------
ISRAEL--4.5%
Bank Hapoalim Bm 74,000 235,690
Bezeq Israel Telecommunication 65,000 351,246
Elite Industries 2,000 108,574
-----------
695,510
-----------
KOREA, REPUBLIC OF--9.0%
Daishin Securities 3,112 38,011
Han Hwa Chemical (a) 12,694 97,050
Housing & Commercial Bank 2,200 42,796
Kookmin Credit Bank 1,100 11,147
Korea Electric Power 4,600 131,102
Korea Green Cross 1,372 71,998
Korean Air Lines 10,500 99,751
LG Chemicals 3,000 85,772
LG Electronics Inc. 1,500 43,700
Namhae Chemical 5,616 104,165
Pohang Iron & Steel 800 77,087
Samsung Electronic 1,900 575,888
SK Corporation 1,243 28,678
-----------
1,407,145
-----------
MEXICO--9.0%
Apasco SA 15,000 93,048
Cemex Appreciation (with warrants exp. 12/12/02) 2,000 1,508
Cemex SA 36,654 166,188
Grupo Modelo SA 60,000 128,458
Grupo Televisa SA (a) 91,000 312,137
Industrias Penoles 15,000 36,266
Telefonos De Mexico 196,800 657,025
-----------
1,394,630
-----------
PERU--2.6%
Cementos Lima 3,218 43,565
Credicorp SA 5,520 59,340
Minas Buenaventura 7,805 69,845
Telefonica Del Peru 125,600 212,906
Union Cerv Peru Backus & Johnston 65,264 23,773
-----------
409,429
-----------
PHILIPPINES--1.5%
Ayala Land Inc. 175,000 28,919
Bacnotan Construction 20,000 6,926
EEI Corporation (a) 950,000 13,852
Manila Electric Company 16,000 27,995
Philippine Long Distance 1,600 34,994
San Miguel Corporation 31,400 37,008
SM Prime Holdings 600,000 81,652
-----------
231,346
-----------
</TABLE>
- --------------------------------------------------------------------------------
20
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT EMERGING MARKETS FUND--Continued
- -------------------------------------------------------------------------------
COMMON STOCK--Continued
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
POLAND--4.6%
Big Bank Gdanski 75,000 $ 234,290
BRE Bank 7,000 252,573
Elektrim (a) 6,000 87,178
KGHM Polska Miedz 15,000 109,335
WBK (Wielkopolski) 6,000 39,375
-----------
722,751
-----------
SOUTH AFRICA--6.8%
Anglo American Platinum 5,000 133,119
Anglogold 1,000 47,892
De Beers Centenary 6,000 140,464
Impala Platinum 2,000 69,956
M Cell 17,000 95,160
Nedcor Ltd. 9,000 183,429
Reunert 30,000 39,706
Sanlam 80,000 102,221
Sappi 20,000 154,847
Sasol 15,000 93,642
-----------
1,060,436
-----------
TAIWAN--7.3%
MSCI Taiwan Index Series (b) (f) 6,800 1,141,244
-----------
THAILAND--4.4%
Advanced Information Services (a) 5,000 68,600
Banpu Company (warrants exp. 1/14/03) 24,000 3,129
Banpu Public Company 24,000 15,389
Charoen Pokphand Feedmill Company 44,000 152,099
Delta Electronics 5,000 62,021
Electricity Generating 35,000 41,182
Hana Microelectronics 11,000 89,083
National Petrochemical 100,000 118,755
PTT Exploration & Production 10,000 51,560
TelecomAsia (a) 50,000 78,863
-----------
680,681
-----------
TURKEY--7.2%
Akbank 4,000,052 74,713
Aksa 1,500,000 73,057
Brisa 414,000 25,659
Sifas (a) 3,689,852 3,835
Turkiye Garanti Bankasi (a) 16,372,984 208,511
Turkiye Is Bankasi 6,000,000 259,795
Usas 35,000 87,072
Vestel Electronis Sanayi (a) 592,000 198,531
Yapi Kredi Bankasi 7,200,000 192,554
-----------
1,123,727
-----------
TOTAL COMMON STOCK
(Cost $11,028,670) 14,394,430
-----------
PREFERRED STOCK--6.0%
BRAZIL
Brahma (Cia Cervejaria) 185,000 146,385
Caemi Mineracao e Metalurgia 3,000,000 267,011
Centrais Electrobras 380,000 7,310
Metalurgica Gerdau 4,500,000 206,719
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
BRAZIL--Continued
Usiminas Usi Sd Mg 51,632 $ 256,455
Vale Rio Doce Compania 1,648 44,950
-----------
TOTAL PREFERRED STOCK
(Cost $400,302) 928,830
-----------
SHORT TERM INVESTMENTS--3.4%
<CAPTION>
Par Value Value
<S> <C> <C>
State Street Bank & Trust Repurchase Agreement
3.50%, 4/3/00, (Dated 3/31/00), Collateralized by
$535,000 U.S. Treasury Bond 5.750%, 11/15/00,
Market Value $544,834, Repurchase Proceeds
$531,155 (Cost $531,000). $531,000 $ 531,000
-----------
TOTAL INVESTMENTS--101.9%
(Cost $11,959,972) (c) 15,854,260
OTHER ASSETS & LIABILITIES (NET)--(1.9)% (291,289)
-----------
NET ASSETS--100% $15,562,971
===========
</TABLE>
(a) Non-income producing security.
(b) Security exempt from registration under Rule 144A of the Securities Act of
1933. (Note 2)
(c) At March 31, 2000, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $11,967,785 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $ 5,002,889
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (1,116,414)
-----------
Net unrealized appreciation $ 3,886,475
===========
</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.
SECTOR ALLOCATIONS (as a percentage of Total Common Stock and Preferred Stock)
<TABLE>
- ---------------------------------
<S> <C>
Basic Industries 18.3%
Capital Goods 6.3%
Consumer Basics 6.2%
Consumer Durable Goods 0.5%
Consumer Non-Durable Goods 1.7%
Consumer Services 0.6%
Energy 1.8%
Finance 28.4%
General Business 6.2%
Miscellaneous 5.1%
Shelter 2.0%
Technology 4.2%
Utilities 18.7%
</TABLE>
The accompanying notes are an integral part of these financial statements.
- -------------------------------------------------------------------------------
21
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT FOREIGN VALUE FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMMON STOCK--87.9%
Shares Value
<S> <C> <C>
AUSTRIA--2.3%
RHI AG 12,600 $ 335,530
-----------
CANADA--2.0%
Methanex Corporation (a) 139,000 280,296
Methanex Corporation (US Shares) (a) (c) 7,000 14,875
-----------
295,171
-----------
DENMARK--2.3%
Jyske Bank A/S 19,500 338,459
-----------
FINLAND--6.8%
Kesko OYJ 35,500 481,001
Kone Corporation OYJ 8,140 471,565
Neptune Maritime OYJ (a) 33,600 56,304
-----------
1,008,870
-----------
FRANCE--5.4%
Banque National Paris 4,600 363,390
Christian Dior SA 1,860 430,478
-----------
793,868
-----------
GERMANY--7.3%
A. Friedrich Flender AG (a) 35,150 434,187
Continental AG 18,600 338,398
Walter AG 15,800 305,612
-----------
1,078,197
-----------
HONG KONG--3.9%
V-Tech Holdings Ltd. 145,234 581,939
-----------
INDONESIA--1.0%
PT Asahimas Flat Glass TBK 1,039,000 123,527
PT Tempo Scan Pacific TBK 72,000 35,429
-----------
158,956
-----------
IRELAND--0.2%
Crean (James) PLC (a) 122,059 35,063
-----------
ITALY--4.2%
Banca Popolare Di Milano 59,500 412,494
Pirelli SPA 82,000 213,179
-----------
625,673
-----------
JAPAN--5.2%
Arisawa Manufacturing Company Ltd. 18,700 415,293
East Japan Railway 68 352,369
-----------
767,662
-----------
KOREA, REPUBLIC OF--4.1%
Samsung Display Devices Ltd. (a) (d) 26,900 248,153
Samsung Electronics Ltd. (d) 3,800 358,625
-----------
606,778
-----------
NETHERLANDS--14.7%
ABN-AMRO Holdings NV 16,600 370,202
Draka Holdings NV 12,284 778,092
Gamma Holdings NV (a) 10,066 351,813
Kon. Boskalis Westminster 24,853 509,277
Roto Smeets de Boer 5,761 158,874
-----------
2,168,258
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
SOUTH AFRICA--7.8%
Palabora Mining Company 58,050 $ 272,241
Sanlam Ltd. 350,000 445,031
Sappi Ltd. 55,700 431,248
-----------
1,148,520
-----------
SPAIN--6.4%
Banco Bilbao Vizcaya Argentaria SA 29,700 436,827
Union Electrica Fenosa SA 25,100 514,579
-----------
951,406
-----------
THAILAND--2.4%
Total Access Communication (a) (d) 111,900 358,080
-----------
UNITED KINGDOM--11.9%
Barratt Developments PLC 102,000 384,874
Beazer Group PLC 187,400 346,097
Bellway PLC 80,100 293,313
Countryside Properties PLC 181,000 348,686
Crest Nicholson PLC 179,000 387,581
-----------
1,760,551
-----------
TOTAL COMMON STOCK
(Cost $12,842,327) 13,012,981
-----------
</TABLE>
<TABLE>
<CAPTION>
SHORT TERM INVESTMENTS--12.1%
Par Value Value
<S> <C> <C>
State Street Bank & Trust Repurchase Agreement 3.50%,
4/3/00, (Dated 3/31/00), Collateralized by
$1,830,000 U.S. Treasury Bond 3.875%, 1/15/09,
Market Value $1,822,788, Repurchase Proceeds
$1,783,520 (Cost $1,783,000). $1,783,000 $ 1,783,000
-----------
TOTAL INVESTMENTS--100.0%
(Cost $14,625,327) (b) 14,795,981
OTHER ASSETS & LIABILITIES (NET)--0.0% 2,757
-----------
NET ASSETS--100% $14,798,738
===========
</TABLE>
(a) Non-income producing security.
(b) At March 31, 2000, the unrealized appreciation of investments based on ag-
gregate cost for federal tax purposes of $14,632,697 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized appreciation for all investments
in which there is an excess of value over tax cost $ 1,814,124
Aggregate gross unrealized depreciation for all investments
in which there is an excess of tax cost over value (1,650,840)
------------
Net unrealized appreciation $ 163,284
============
</TABLE>
(c) ADR--American Depository Receipts
(d) GDR--Global Depository Receipts
- --------------------------------------------------------------------------------
22
<PAGE>
[LOGO OF QUANT]
PORTFOLIO OF INVESTMENTS March 31, 2000
QUANT FOREIGN VALUE FUND--Continued
- --------------------------------------------------------------------------------
SECTOR ALLOCATIONS (as a percentage of Total Common Stock)
<TABLE>
- ---------------------------------
<S> <C>
Basic Industries 7.7%
Capital Goods 32.4%
Consumer Basics 4.2%
Consumer Durable Goods 4.2%
Consumer Non-Durable Goods 6.0%
Consumer Services 0.4%
Finance 18.2%
General Business 4.0%
Shelter 9.8%
Technology 6.4%
Transportation 2.7%
Utilities 4.0%
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
23
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES March 31, 2000
<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) $81,216,467 $21,809,964 $98,140,698 $19,636,653 $15,854,260 $14,795,981
Foreign currency at
value (Cost $428,789 for
International Equity,
$6,408 for Emerging
Markets and $2,576 for
Foreign Value) (Note 2) -- -- -- 422,457 31,416 2,576
Cash 1,897 1,449 791,971 1,615 1,845 1,282
Collateral for
securities loaned at
value (Note 6) -- -- -- 955,918 -- --
Dividends, interest and
foreign tax reclaims
receivable 32,808 4,772 60,577 73,024 47,533 35,302
Receivable for
investments sold -- 548,445 -- 74,900 732,023 41,263
Receivable for shares of
beneficial interest sold 3,348 980 11,731 789 63 39,480
Receivable from Manager
for reimbursement of
expenses (Note 3) -- -- -- 1,409 -- --
Other assets 17,141 3,941 19,964 3,570 2,926 3,025
----------- ----------- ----------- ----------- ----------- -----------
Total assets 81,271,661 22,369,551 99,024,941 21,170,335 16,670,066 14,918,909
----------- ----------- ----------- ----------- ----------- -----------
Liabilities:
Collateral for
securities loaned (Note
6) -- -- -- 955,918 -- --
Payable for investments
purchased 292,350 1,419,537 -- 493,405 1,062,845 41,174
Payable for shares of
beneficial interest
repurchased 35,000 4,847 35,903 -- -- 42,790
Payable for compensation
of Manager (Note 3) 72,569 16,595 62,989 16,461 10,864 12,335
Payable for distribution
fees (Note 3) 33,518 -- 40,999 8,140 5,651 2,905
Payable to custodian 7,893 5,029 -- 11,668 12,358 6,905
Payable to transfer
agent (Note 3) 15,066 2,714 18,122 4,804 3,010 1,756
Other accrued expenses 25,570 13,799 35,992 17,317 12,367 12,306
----------- ----------- ----------- ----------- ----------- -----------
Total liabilities 481,966 1,462,521 194,005 1,507,713 1,107,095 120,171
----------- ----------- ----------- ----------- ----------- -----------
Net assets $80,789,695 $20,907,030 $98,830,936 $19,662,622 $15,562,971 $14,798,738
=========== =========== =========== =========== =========== ===========
Net Assets consist of:
Shares of beneficial
interest $46,660,350 $10,870,474 $52,652,148 $16,035,474 $13,850,056 $15,153,238
Undistributed net
investment income (loss) -- -- -- (128,064) 2,634 1,193
Accumulated net realized
gain (loss) on
investments and foreign
denominated assets,
liabilities and currency 5,955,447 3,020,991 12,381,294 1,182,864 (2,184,010) (526,643)
Unrealized appreciation
(depreciation) of
investments and foreign
denominated assets,
liabilities and currency 28,173,898 7,015,565 33,797,494 2,572,348 3,894,291 170,950
----------- ----------- ----------- ----------- ----------- -----------
$80,789,695 $20,907,030 $98,830,936 $19,662,622 $15,562,971 $14,798,738
----------- ----------- ----------- ----------- ----------- -----------
Investments, at cost $53,042,569 $14,794,399 $64,343,204 $17,062,885 $11,959,972 $14,625,327
----------- ----------- ----------- ----------- ----------- -----------
Net assets
Ordinary Shares $74,289,090 $19,921,097 $96,476,781 $19,490,711 $12,767,210 $13,594,986
Institutional Shares $ 6,500,605 $ 985,933 $ 2,354,155 $ 171,911 $ 2,795,761 $ 1,203,752
Shares of beneficial
interest outstanding
(Unlimited number of
shares authorized)
Ordinary Shares 2,993,641 807,293 3,727,452 1,624,227 1,360,044 1,501,814
Institutional Shares 250,808 39,108 89,782 14,324 295,040 132,918
Net asset value and
offering price per
share*
Ordinary Shares $ 24.82 $ 24.68 $ 25.88 $ 12.00 $ 9.39 $ 9.05
Institutional Shares $ 25.92 $ 25.21 $ 26.22 $ 12.00 $ 9.48 $ 9.06
</TABLE>
* A redemption fee amounting to 1% of the net asset value of the
Ordinary Shares redeemed is withheld and paid to the Distribu-
tor. No redemption fee is withheld from redemptions of the In-
stitutional Shares. In addition, no redemption fee 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.
- --------------------------------------------------------------------------------
24
<PAGE>
STATEMENT OF OPERATIONS Year Ended March 31, 2000
<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* $ 322,601 $ 78,277 $ 465,398 $ 373,290 $ 287,779 $239,823
Interest 84,903 17,487 -- 12,956 17,387 42,226
Miscellaneous -- -- -- 38 41 184
----------- ---------- ----------- ---------- ---------- --------
Total investment income 407,504 95,764 465,398 386,284 305,207 282,233
----------- ---------- ----------- ---------- ---------- --------
Expenses:
Compensation of Manager
(Note 3) 614,633 150,343 601,110 217,370 107,302 121,504
Distribution fees, Or-
dinary Shares (Note 3) 283,272 35,913 385,662 101,984 57,568 29,650
Custodian fees 48,080 40,500 47,500 81,845 81,990 50,370
Transfer agent fees
(Note 3):
Ordinary Shares 80,517 20,437 109,848 29,142 16,372 16,861
Institutional Shares 6,842 950 4,326 1,921 2,702 413
Audit and legal 44,812 11,074 60,023 16,931 9,804 8,807
Registration fees 15,540 3,884 21,566 6,259 3,247 2,830
Insurance 13,711 3,389 18,372 5,170 3,006 2,712
Compensation of Trust-
ees (Note 3) 5,663 1,391 7,456 2,058 1,269 1,164
Printing 15,636 3,846 20,890 5,758 3,432 3,121
Miscellaneous (Note 3) 57,623 15,106 73,023 24,799 16,521 11,631
----------- ---------- ----------- ---------- ---------- --------
Total expenses before
waivers and/or reim-
bursements, and reduc-
tions 1,186,329 286,833 1,349,776 493,237 303,213 249,063
Waivers and/or reim-
bursements of expenses
(Note 3) -- (35,913) -- (26,300) -- (19,691)
Fees reduced by credits
allowed by Custodian
(Note 3) (3,473) -- (31,368) (11,437) -- --
----------- ---------- ----------- ---------- ---------- --------
Expenses, net 1,182,856 250,920 1,318,408 455,500 303,213 229,372
----------- ---------- ----------- ---------- ---------- --------
Net investment income
(loss) (775,352) (155,156) (853,010) (69,216) 1,994 52,861
----------- ---------- ----------- ---------- ---------- --------
Realized and Unrealized
Gain (Loss) on
Investments, Foreign
Currency and Foreign
Translation:
Net realized gain
(loss) (Note 2) on:
Investments 12,518,037 3,667,858 22,532,196 2,945,435 490,296 211,488
Foreign denominated as-
sets, liabilities and
currency -- -- -- (20,266) (10,110) (5,355)
Change in unrealized
appreciation (deprecia-
tion) of:
Investments 22,479,764 5,137,854 13,226,035 (233,095) 3,917,649 719,183
Foreign denominated as-
sets, liabilities and
currency -- -- -- 201 6,252 929
----------- ---------- ----------- ---------- ---------- --------
Net realized and
unrealized gain (loss) 34,997,801 8,805,712 35,758,231 2,692,275 4,404,087 926,245
----------- ---------- ----------- ---------- ---------- --------
Net increase (decrease)
in net assets resulting
from operations $34,222,449 $8,650,556 $34,905,221 $2,623,059 $4,406,081 $979,106
=========== ========== =========== ========== ========== ========
</TABLE>
* Dividends are net of foreign withholding taxes of $523 for
Small Cap, $14,196 for Growth and Income, $55,124 for Interna-
tional Equity, $23,950 for Emerging Markets and $26,076 for
Foreign Value.
The accompanying notes are an integral part of these financial
statements.
- --------------------------------------------------------------------------------
25
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Small Cap Mid Cap Growth and Income
Year ended Year ended Year ended Year ended Year ended Year ended
March 31, 2000 March 31, 1999 March 31, 2000 March 31, 1999 March 31, 2000 March 31, 1999
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations:
Net investment income
(loss) $ (775,352) $ (562,515) $ (155,156) $ (106,681) $ (853,010) $ (236,608)
Net realized gain
(loss) on investments,
foreign denominated
assets, liabilities,
currency and written
options 12,518,037 (5,509,251) 3,667,858 606,101 22,532,196 10,150,742
Unrealized appreciation
(depreciation) of
investments and foreign
denominated assets,
liabilities and
currency 22,479,764 (6,572,725) 5,137,854 (1,098,384) 13,226,035 (1,022,813)
----------- ------------ ----------- ----------- ------------ -----------
Net increase (decrease)
in net assets resulting
from operations 34,222,449 (12,644,491) 8,650,556 (598,964) 34,905,221 8,891,321
Distributions to
shareholders from:
Net investment income
Ordinary Shares -- -- -- -- -- --
Institutional Shares -- -- -- -- -- --
Distributions in excess
of net investment
income
Ordinary Shares -- -- -- -- -- --
Institutional Shares -- -- -- -- -- --
Net realized gains
Ordinary Shares -- -- (1,051,870) (351,734) (16,535,191) (7,029,265)
Institutional Shares -- -- (46,385) (24,367) (657,052) (429,071)
Distributions in excess
of net realized gains
Ordinary Shares -- -- -- -- -- --
Institutional Shares -- -- -- -- -- --
Return of capital
Ordinary Shares -- -- -- -- -- --
Institutional Shares -- -- -- -- -- --
----------- ------------ ----------- ----------- ------------ -----------
-- -- (1,098,255) (376,101) (17,192,243) (7,458,336)
----------- ------------ ----------- ----------- ------------ -----------
Fund share transactions
(Note 10) (5,717,640) (8,232,637) 181,135 (2,158,430) 5,636,664 3,927,993
----------- ------------ ----------- ----------- ------------ -----------
Increase (decrease) in
net assets 28,504,809 (20,877,128) 7,733,436 (3,133,495) 23,349,642 5,360,978
Net assets beginning of
year 52,284,886 73,162,014 13,173,594 16,307,089 75,481,294 70,120,316
----------- ------------ ----------- ----------- ------------ -----------
Net assets end of year* $80,789,695 $ 52,284,886 $20,907,030 $13,173,594 $ 98,830,936 $75,481,294
=========== ============ =========== =========== ============ ===========
* Includes undistributed
net investment income
(loss) of $ -- $ 12,293 $ -- $ -- $ -- $ --
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
26
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS--Continued
<TABLE>
<CAPTION>
International Equity Emerging Markets Foreign Value
Year ended Year ended Year ended Year ended Year ended Year ended
March 31, 2000 March 31, 1999 March 31, 2000 March 31, 1999 March 31, 2000 March 31, 1999**
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations:
Net investment income
(loss) $ (69,216) $ 40,721 $ 1,994 $ 97,849 $ 52,861 $ 10,203
Net realized gain
(loss) on investments,
foreign denominated
assets, liabilities,
currency and written
options 2,925,169 51,083 480,186 (153,778) 206,133 (298,274)
Unrealized appreciation
(depreciation) of
investments and foreign
denominated assets,
liabilities and
currency (232,894) (1,703,373) 3,923,901 (1,311,380) 720,112 (549,162)
--------------- ---------------- ----------- ----------- ----------- ----------
Net increase (decrease)
in net assets resulting
from operations 2,623,059 (1,611,569) 4,406,081 (1,367,309) 979,106 (837,233)
Distributions to
shareholders from:
Net investment income
Ordinary Shares -- (47,429) -- (62,864) (440,249) (10,203)
Institutional Shares -- (5,481) -- (15,751) (2,829) --
Distributions in excess
of net investment
income
Ordinary Shares (524,319) (9,143) (20,725) -- (34,588) (9,526)
Institutional Shares (47,894) (1,057) (9,394) -- (222) --
Net realized gains
Ordinary Shares (763,209) -- -- -- --
Institutional Shares (58,039) -- -- -- --
Distributions in excess
of net realized gains
Ordinary Shares -- -- -- -- -- --
Institutional Shares -- -- -- -- -- --
Return of capital
Ordinary Shares -- -- -- (26,927) -- --
Institutional Shares -- -- -- (6,747) -- --
--------------- ---------------- ----------- ----------- ----------- ----------
(1,393,461) (63,110) (30,119) (112,289) (477,888) (19,729)
--------------- ---------------- ----------- ----------- ----------- ----------
Fund share transactions
(Note 10) (5,418,070) (8,384,309) 1,297,698 1,126,259 6,418,141 8,736,341
--------------- ---------------- ----------- ----------- ----------- ----------
Increase (decrease) in
net assets (4,188,472) (10,058,988) 5,673,660 (353,339) 6,919,359 7,879,379
Net assets beginning of
year 23,851,094 33,910,082 9,889,311 10,242,650 7,879,379 --
--------------- ---------------- ----------- ----------- ----------- ----------
Net assets end of year* $ 19,662,622 $ 23,851,094 $15,562,971 $ 9,889,311 $14,798,738 $7,879,379
=============== ================ =========== =========== =========== ==========
* Includes
undistributed net
investment income
(loss) of $ (128,064) $ (27,158) $ 2,634 $ (11,691) $ 1,193 $ (18,051)
</TABLE>
**From the commencement of operations on May 15, 1998.
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
27
<PAGE>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Income from
Investment Operations(a) Distributions
Net Asset Net Net Realized Dividends Distributions
Value at Investment and Unrealized Total from from Net from Net Asset
Beginning Income Gain (Loss) Investment Investment Realized Total Value End Total
of Period (Loss)(b)(c) on Securities Operations Income Capital Gains Distributions of Period Return(d)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Small Cap
Ordinary Shares
Year Ended March
31, 2000 $14.60 (0.24) 10.46 10.22 -- -- -- $24.82 70.00 %
Year Ended March
31, 1999 $17.80 (0.15) (3.05) (3.20) -- -- -- $14.60 (17.98)%
Year Ended March
31, 1998 $15.04 (0.23) 5.60 5.37 (0.16) (2.45)(h) (2.61) $17.80 37.79 %
Year Ended March
31, 1997 $18.91 0.16 (g) 0.77 0.93 -- (4.80) (4.80) $15.04 1.72 %
Year Ended March
31, 1996 $15.81 (0.21) 5.54 5.33 -- (2.23) (2.23) $18.91 34.25 %
Institutional
Shares
Year Ended March
31, 2000 $15.17 (0.15) 10.90 10.75 -- -- -- $25.92 70.86 %
Year Ended March
31, 1999 $18.40 (0.08) (3.15) (3.23) -- -- -- $15.17 (17.55)%
Year Ended March
31, 1998 $15.55 (0.15) 5.79 5.64 (0.34) (2.45)(h) (2.79) $18.40 38.44 %
Year Ended March
31, 1997 $19.33 0.08 (g) 0.94 1.02 -- (4.80) (4.80) $15.55 2.21 %
Year Ended March
31, 1996 $16.05 (0.12) 5.63 5.51 -- (2.23) (2.23) $19.33 34.89 %
Mid Cap
Ordinary Shares
Year Ended March
31, 2000 $15.46 (0.19) 10.74 10.55 -- (1.33) (1.33) $24.68 71.41 %
Year Ended March
31, 1999 $16.05 (0.11) (0.09) (0.20) -- (0.39) (0.39) $15.46 (1.08)%
Year Ended March
31, 1998 $13.44 (0.08) 6.06 5.98 -- (3.37) (3.37) $16.05 46.76 %
Year Ended March
31, 1997 $13.20 0.09 2.29 2.38 (0.14) (2.00) (2.14) $13.44 17.47 %
Year Ended March
31, 1996 $10.12 0.06 3.27 3.33 (0.01) (0.24) (0.25) $13.20 33.01 %
Institutional
Shares
Year Ended March
31, 2000 $15.65 (0.19) 11.08 10.89 -- (1.33) (1.33) $25.21 72.81 %
Year Ended March
31, 1999 $16.24 (0.10) (0.10) (0.20) -- (0.39) (0.39) $15.65 (1.07)%
Year Ended March
31, 1998 $13.55 (0.06) 6.12 6.06 -- (3.37) (3.37) $16.24 47.01 %
Year Ended March
31, 1997 $13.20 0.11 2.27 2.38 (0.03) (2.00) (2.03) $13.55 17.51 %
April 17, 1995*
to March 31,
1996 $10.27 0.10 3.09 3.19 (0.02) (0.24) (0.26) $13.20 31.12 %
Growth and In-
come
Ordinary Shares
Year Ended March
31, 2000 $21.26 (0.25) 10.21 9.96 -- (5.34) (5.34) $25.88 51.46 %
Year Ended March
31, 1999 $20.85 (0.08) 2.82 2.74 -- (2.33) (2.33) $21.26 13.67 %
Year Ended March
31, 1998 $15.22 0.00 7.61 7.61 (0.05) (1.93) (1.98) $20.85 51.52 %
Year Ended March
31, 1997 $14.57 0.08 2.53 2.61 (0.10) (1.86) (1.96) $15.22 17.97 %
Year Ended March
31, 1996 $13.72 0.12 2.89 3.01 (0.13) (2.03) (2.16) $14.57 22.17 %
Institutional
Shares
Year Ended March
31, 2000 $21.37 (0.14) 10.33 10.19 -- (5.34) (5.34) $26.22 52.32 %
Year Ended March
31, 1999 $20.84 0.03 2.83 2.86 -- (2.33) (2.33) $21.37 14.27 %
Year Ended March
31, 1998 $15.24 0.10 7.60 7.70 (0.17) (1.93) (2.10) $20.84 52.18 %
Year Ended March
31, 1997 $14.58 0.15 2.55 2.70 (0.18) (1.86) (2.04) $15.24 18.62 %
Year Ended March
31, 1996 $13.72 0.20 2.89 3.09 (0.20) (2.03) (2.23) $14.58 22.75 %
International
Equity
Ordinary Shares
Year Ended March
31, 2000 $11.37 (0.04) 1.50 1.46 (0.34)(i) (0.49) (0.83) $12.00 12.93 %
Year Ended March
31, 1999 $11.97 0.01 (0.58) (0.57) (0.03)(i) -- (0.03) $11.37 (4.78)%
Year Ended March
31, 1998 $11.03 0.07 1.30 1.37 (0.17)(i) (0.26)(j) (0.43) $11.97 12.95 %
Year Ended March
31, 1997 $10.70 0.01 0.40 0.41 (0.08) -- (0.08) $11.03 3.82 %
Year Ended March
31, 1996 $10.06 0.00 0.67 0.67 (0.03) -- (0.03) $10.70 6.63 %
<CAPTION>
Ratios and Supplemental Data
Ratio of Expenses to Average
Net Assets(e)(f)
Net Assets Net Investment
End of Including Income (Loss)
Period Excluding Custody to Average Net Portfolio
(000's) Credits Gross Credits Assets(c)(e) Turnover(e)
<S> <C> <C> <C> <C> <C> <C>
Small Cap
Ordinary Shares
Year Ended March
31, 2000 $74,289 1.97% 1.97% 1.96% (1.30)% 145.00%
Year Ended March
31, 1999 $47,605 1.94% 1.94% 1.94% (0.99)% 113.00%
Year Ended March
31, 1998 $66,876 1.90% 1.96% 1.89% (1.33)% 135.00%
Year Ended March
31, 1997 $57,135 1.97% 2.03% 1.90% 0.90 %(g) 393.00%
Year Ended March
31, 1996 $71,618 1.97% 1.97% 1.88% (1.17)% 324.00%
Institutional
Shares
Year Ended March
31, 2000 $ 6,501 1.47% 1.47% 1.46% (0.80)% 145.00%
Year Ended March
31, 1999 $ 4,680 1.44% 1.44% 1.44% (0.49)% 113.00%
Year Ended March
31, 1998 $ 6,286 1.41% 1.47% 1.40% (0.86)% 135.00%
Year Ended March
31, 1997 $ 9,207 1.47% 1.52% 1.40% 0.41 %(g) 393.00%
Year Ended March
31, 1996 $42,803 1.47% 1.47% 1.38% (0.67)% 324.00%
Mid Cap
Ordinary Shares
Year Ended March
31, 2000 $19,921 1.67% 1.92% 1.67% (1.03)% 153.00%
Year Ended March
31, 1999 $12,617 1.65% 1.87% 1.65% (0.72)% 168.00%
Year Ended March
31, 1998 $15,484 1.57% 1.97% 1.57% (0.52)% 128.00%
Year Ended March
31, 1997 $ 8,733 1.19% 2.19% 1.11% 0.62 % 162.00%
Year Ended March
31, 1996 $ 6,025 2.34% 2.62% 1.92% 0.46 % 181.00%
Institutional
Shares
Year Ended March
31, 2000 $ 986 1.67% 1.67% 1.67% (1.04)% 153.00%
Year Ended March
31, 1999 $ 557 1.62% 1.62% 1.62% (0.69)% 168.00%
Year Ended March
31, 1998 $ 823 1.40% 1.72% 1.40% (0.35)% 128.00%
Year Ended March
31, 1997 $ 361 1.44% 2.01% 1.27% 0.77 % 162.00%
April 17, 1995*
to March 31,
1996 $ 4,621 2.02% 2.51% 1.66% 0.87 % 181.00%
Growth and In-
come
Ordinary Shares
Year Ended March
31, 2000 $96,477 1.70% 1.70% 1.66% (1.08)% 78.00%
Year Ended March
31, 1999 $70,874 1.67% 1.67% 1.62% (0.36)% 97.00%
Year Ended March
31, 1998 $66,397 1.69% 1.69% 1.65% (0.01)% 72.00%
Year Ended March
31, 1997 $43,266 1.73% 1.73% 1.70% 0.50 % 98.00%
Year Ended March
31, 1996 $41,353 1.73% 1.73% 1.64% 0.81 % 152.00%
Institutional
Shares
Year Ended March
31, 2000 $ 2,354 1.20% 1.20% 1.16% (0.60)% 78.00%
Year Ended March
31, 1999 $ 4,607 1.17% 1.17% 1.12% 0.14 % 97.00%
Year Ended March
31, 1998 $ 3,724 1.19% 1.19% 1.14% 0.50 % 72.00%
Year Ended March
31, 1997 $ 1,532 1.24% 1.24% 1.21% 0.99 % 98.00%
Year Ended March
31, 1996 $ 1,888 1.24% 1.24% 1.15% 1.31 % 152.00%
International
Equity
Ordinary Shares
Year Ended March
31, 2000 $19,491 2.18% 2.30% 2.13% (0.35)% 78.00%
Year Ended March
31, 1999 $21,956 2.11% 2.11% 2.08% 0.12 % 128.00%
Year Ended March
31, 1998 $32,182 2.18% 2.18% 2.03% 0.62 % 61.00%
Year Ended March
31, 1997 $27,410 2.20% 2.23% 2.15% 0.10 % 135.00%
Year Ended March
31, 1996 $27,402 2.15% 2.15% 2.09% (0.04)% 43.00%
</TABLE>
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
28
<PAGE>
FINANCIAL HIGHLIGHTS--Continued
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Income from
Investment Operations(a) Distributions
Net Asset Net Net Realized Dividends Distributions
Value at Investment and Unrealized Total from from Net from Net Asset
Beginning Income Gain (Loss) Investment Investment Realized Total Value End Total
of Period (Loss)(b)(c) on Securities Operations Income Capital Gains Distributions of Period Return(d)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
International
Equity
- --Continued
Institutional
Shares
Year Ended March
31, 2000 $11.39 0.02 1.49 1.51 (0.41)(i) (0.49) (0.90) $12.00 13.33 %
Year Ended March
31, 1999 $11.95 0.06 (0.58) (0.52) (0.04)(i) -- (0.04) $11.39 (4.34)%
Year Ended March
31, 1998 $11.10 0.14 1.28 1.42 (0.31)(i) (0.26)(j) (0.57) $11.95 13.50 %
Year Ended March
31, 1997 $10.73 0.06 0.41 0.47 (0.10) -- (0.10) $11.10 4.38 %
Year Ended March
31, 1996 $10.10 0.04 0.66 0.70 (0.07) -- (0.07) $10.73 6.95 %
Emerging Markets
Ordinary Shares
Year Ended March
31, 2000 $ 6.59 (0.01) 2.83 2.82 (0.02)(k) -- (0.02) $ 9.39 42.73 %
Year Ended March
31, 1999 $ 7.70 0.07 (1.11) (1.04) (0.07)(l) -- (0.07) $ 6.59 (13.40)%
Year Ended March
31, 1998 $ 9.24 (0.04) (1.50) (1.54) -- -- -- $ 7.70 (16.67)%
Year Ended March
31, 1997 $ 8.38 (0.04) 0.90 0.86 -- -- -- $ 9.24 10.26 %
Year Ended March
31, 1996 $ 7.24 (0.07) 1.21 1.14 -- -- -- $ 8.38 15.75 %
Institutional
Shares
Year Ended March
31, 2000 $ 6.64 0.04 2.85 2.89 (0.05)(k) -- (0.05) $ 9.48 43.55 %
Year Ended March
31, 1999 $ 7.76 0.09 (1.11) (1.02) (0.10)(l) -- (0.10) $ 6.64 (12.93)%
Year Ended March
31, 1998 $ 9.27 0.02 (1.53) (1.51) -- -- -- $ 7.76 (16.29)%
April 2, 1996*
to March 31,
1997 $ 8.49 0.01 0.80 0.81 (0.03) -- (0.03) $ 9.27 9.54 %
Foreign Value
Ordinary Shares
Year Ended March
31, 2000 $ 8.36 0.04 0.97 1.01 (0.32)(m) -- (0.32) $ 9.05 12.17 %
May 15, 1998* to
March 31, 1999 $10.00 0.02 (1.64) (1.62) (0.02)(m) -- (0.02) $ 8.36 (16.16)%
Institutional
Shares
Year Ended March
31, 2000 $ 8.37 0.12 0.91 1.03 (0.34)(m) -- (0.34) $ 9.06 12.37 %
December 18,
1998* to March
31, 1999 $ 8.43 0.06 (0.12) (0.06) -- -- -- $ 8.37 (0.71)%
<CAPTION>
Ratios and Supplemental Data
Ratio of Expenses to Average
Net Assets(e)(f)
Net Assets Net Investment
End of Including Income (Loss)
Period Excluding Custody to Average Net Portfolio
(000's) Credits Gross Credits Assets(c)(e) Turnover(e)
<S> <C> <C> <C> <C> <C> <C>
International
Equity
- --Continued
Institutional
Shares
Year Ended March
31, 2000 $ 172 1.68% 1.80% 1.63% 0.14 % 78.00%
Year Ended March
31, 1999 $ 1,895 1.61% 1.61% 1.58% 0.62 % 128.00%
Year Ended March
31, 1998 $ 1,728 1.68% 1.69% 1.54% 1.19 % 61.00%
Year Ended March
31, 1997 $ 1,760 1.69% 1.75% 1.64% 0.51 % 135.00%
Year Ended March
31, 1996 $ 1,241 1.65% 1.65% 1.59% 0.38 % 43.00%
Emerging Markets
Ordinary Shares
Year Ended March
31, 2000 $12,767 2.33% 2.33% 2.33% (0.07)% 31.00%
Year Ended March
31, 1999 $ 8,442 2.32% 2.58% 2.24% 1.03 % 49.00%
Year Ended March
31, 1998 $ 9,241 2.69% 2.69% 2.57% (0.43)% 52.00%
Year Ended March
31, 1997 $10,052 2.68% 2.68% 2.56% (0.47)% 8.00%
Year Ended March
31, 1996 $ 7,736 2.74% 2.74% 2.59% (0.84)% 9.00%
Institutional
Shares
Year Ended March
31, 2000 $ 2,796 1.83% 1.83% 1.83% 0.52 % 31.00%
Year Ended March
31, 1999 $ 1,447 1.82% 2.08% 1.74% 1.36 % 49.00%
Year Ended March
31, 1998 $ 1,002 2.19% 2.19% 2.07% 0.24 % 52.00%
April 2, 1996*
to March 31,
1997 $ 1,212 2.01% 2.17% 1.89% 0.13 % 8.00%
Foreign Value
Ordinary Shares
Year Ended March
31, 2000 $13,595 1.90% 2.06% 1.90% 0.40 % 30.00%
May 15, 1998* to
March 31, 1999 $ 7,478 1.99% 2.13% 1.90% 0.19 % 22.00%
Institutional
Shares
Year Ended March
31, 2000 $ 1,204 1.61% 1.77% 1.61% 1.67 % 30.00%
December 18,
1998* to March
31, 1999 $ 401 1.72% 1.86% 1.70% 0.75 % 22.00%
</TABLE>
* Commencement of Operations
(a) Per share numbers have been calculated using the average shares method.
(b) Reflects expense waivers/reimbursements and reductions in effect during
the period. See Note 3 to the Financial Statements.
(c) Net investment income (loss) per share and the ratio of net investment in-
come (loss) to average net assets reflect net investment income prior to
certain reclassifications for federal income or excise taxes.
(d) Total Return does not include the one time redemption fee of 1% for the
Ordinary Shares. Effective August 1, 1996 Mid Cap Ordinary Shares are no
longer subject to the redemption fee 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. See Note 3 to the
Financial Statements.
(e) Periods less than one year are annualized.
(f) Ratio of expenses to average net assets shows:
Excluding Credits (total expenses less fees waivers and reimbursements by
the investment advisor, if any).
Gross (total expenses not taking into account fee waivers and reimbursements
by the investment advisor or custody earnings credits, if any).
Including Credits (expenses less fee waivers and reimbursements by the in-
vestment advisor and reduced by custody earnings credits, if any).
(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) Distributions from realized capital gains include distributions in excess
of realized capital gains of $0.03 per share.
(i) Distributions from net investment income includes distributions in excess
of current net income of $0.34, $0.01 and $0.06 per share for Ordinary
Shares, and $0.41, $0.01 and $0.11 per share for Institutional Shares dur-
ing the fiscal years ended March 31, 2000, 1999 and 1998, respectively.
(j) Distributions from realized capital gains include distributions in excess
of realized capital gains of $0.05 per share.
(k) Distributions from net investment income includes distributions in excess
of current net investment income of $0.02 per share for Ordinary Shares
and $0.05 per share for Institutional Shares.
(l) Distributions from net investment income includes a return of capital of
$0.02 per share for Ordinary Shares and $0.03 per share for Institutional
Shares.
(m) Distribution from net investment income includes distributions in excess
of current net investment income of $0.02 and $0.01 for Ordinary Shares,
and $0.02 and $(-) for Institutional Shares for the years ended March 31,
2000 and 1999, respectively.
The accompanying notes are an integral part of these financial
statements.
- --------------------------------------------------------------------------------
29
<PAGE>
[LOGO OF QUANT]
NOTES TO FINANCIAL STATEMENTS
1. Organization of the Trust.
The Quantitative Group of Funds (the "Trust") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940, as
amended, as a non-diversified, open-end management investment company. Effec-
tive November 30, 1999, the Trust began doing business as "Quant Funds." The
Trust currently has six series (individually a "Fund" and collectively the
"Funds") each with a distinct investment objective: Quant Small Cap, Quant Mid
Cap, Quant Growth and Income, Quant International Equity, Quant Emerging Mar-
kets, and Quant Foreign Value.
The Quant Small Cap Fund ("Small Cap") seeks maximum long-term capital appre-
ciation by investing primarily in common stocks of companies with smaller mar-
ket capitalizations or larger companies with higher than average expected
earnings growth rates.
The Quant Mid Cap Fund ("Mid Cap") seeks long-term growth of capital by in-
vesting primarily in common stock of companies with medium market capitaliza-
tions.
The Quant Growth and Income Fund ("Growth and Income") seeks long-term growth
of capital and income by investing primarily in common stocks of larger compa-
nies having substantial equity capital that are currently paying dividends.
The Quant International Equity Fund ("International Equity") seeks long-term
capital growth and income by investing primarily in foreign securities. Gener-
ally, the Fund invests in Western Europe, Australia, and the larger capital
markets in the Far East.
The Quant Emerging Markets Fund ("Emerging Markets") seeks long-term growth of
capital by investing in securities of foreign issuers located in emerging mar-
kets.
The Quant 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, Australia,
and the larger capital markets in the Far East. The Fund may also invest in
emerging markets.
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 up to 4:00 p.m. on the principal exchange or market on which they are
traded. If there is no such reported sale, the securities are valued at the
last reported price. Short-term investments that mature in 60 days or less are
valued at amortized cost. Securities quoted in foreign currencies are trans-
lated into U.S. dollars based upon the prevailing exchange rate on each busi-
ness day. Other assets and securities for which no quotations are readily
available are valued at fair value as determined in good faith using proce-
dures approved by the Funds' Trustees (the "Trustees").
Security Transactions and Related Investment Income.
Security transactions are accounted for on the trade date (the date the order
to buy or sell is executed). Dividend income is recorded on the ex-dividend
date, except that certain dividends from foreign securities are recorded as
soon as the Funds are informed of the ex-dividend date. Interest income is re-
corded on the accrual basis. In determining the net gain or loss on securities
sold, the cost of securities is determined on the identified cost basis. Each
Fund's investment income and realized and unrealized gains and losses are al-
located among classes based upon the daily relative net assets.
Repurchase Agreements.
The Funds' custodian takes possession through the federal book-entry system of
securities collateralizing repurchase agreements. Collateral is marked-to-mar-
ket daily to ensure that the market value of the underlying assets remains
sufficient to protect the Funds. The Funds may experience costs and delays in
liquidating the collateral if the issuer defaults or enters into bankruptcy.
Options.
Premiums received by the Funds upon writing put or call options are recorded
as an asset with a corresponding liability which is subsequently adjusted to
the current market value of the option. When an option expires, is exercised,
or is closed, 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.
- -------------------------------------------------------------------------------
30
<PAGE>
[LOGO OF QUANT]
NOTES TO FINANCIAL STATEMENTS--Continued
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,
$1,532,332, or 10% of net assets of Emerging Markets, was invested in re-
stricted securities 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, and if necessary, assume expenses, 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 fis-
cal year. The distribution agreement calls for the Distributor to reduce its
fee similarly after the Manager's fee has been eliminated. The Manager has
also voluntarily agreed to waive fees or assume certain operating expenses of
Emerging Markets in order to reduce the total expenses of this Fund to no more
than 2.25% of its average net assets. Fund expenses subject to this limitation
are exclusive of brokerage, interest, taxes and extraordinary expenses, which
include incremental custody costs associated with international securities.
Expenses are calculated gross of custody credits, if applicable.
For the year ended March 31, 2000, the fees waived or expenses reimbursed by
the Manager amounted to $26,300 for International Equity. The aggregate man-
agement fees, net of fees waived or reimbursed by the Manager amounted to
$1,785,962.
The Manager has entered into advisory contracts with the following advisors
(collectively the "Advisors") to provide investment advisory services to the
following Funds: Columbia Partners, L.L.C., Investment Management (Small Cap,
Mid Cap), State Street Bank and Trust Company (Growth and Income), Indepen-
dence 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; 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; and Foreign Value
for the period April 1, 1999 to October 5, 1999, 0.35% of first $30 million
and 0.50% of amounts over $30 million and for the period October 5, 1999 to
March 31,
- -------------------------------------------------------------------------------
31
<PAGE>
[LOGO OF QUANT]
NOTES TO FINANCIAL STATEMENTS--Continued
2000, 0.35% of the first $35 million, 0.40% of amounts over $35 million and up
to $200 million and 0.50% for assets in excess of $200 million of average
daily total net assets.
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%. Holders of In-
stitutional Shares bear no portion of the 12b-1 Plan expenses of the Funds and
are not entitled to vote on matters involving the 12b-1 Plan. For the year
ended March 31, 2000, the Distributor voluntarily agreed to waive its fees
with respect to Mid Cap, which amounted to $35,913. During the year ended
March 31, 2000, the aggregate fees paid by the Funds pursuant to such distri-
bution plan, net of fees waived by the Distributor, amounted to $858,136.
A deferred sales charge amounting to 1% of the net asset value of Ordinary
Shares redeemed of Small Cap, Growth and Income, International Equity, Emerg-
ing Markets and Foreign Value is withheld from the redemption proceeds and
paid to the Distributor. The deferred sales charge is also imposed on redemp-
tions of Ordinary Shares of Mid Cap purchased prior to August 1, 1996. The de-
ferred sales charge is not imposed on redemptions of Institutional Shares and
certain other transactions. The Funds have been advised that during the year
ended March 31, 2000, such fees earned by the Distributor were $144,776.
Transfer agent functions are provided to the Funds by Quantitative Institu-
tional Services, a division of the Manager (the "Transfer Agent") pursuant to
a transfer agent agreement. The transfer agent agreement provides for base
fees that are payable to the Transfer Agent at an annual rate of 0.13% of the
aggregate average daily net asset value of each class of shares of each Fund
and for reimbursement of out of pocket expenses. During the year ended March
31, 2000, the aggregate fees, net of fees waived by the Transfer Agent, paid
by the Funds pursuant to such agreement amounted to $278,140. The Transfer
Agent voluntarily agreed to waive its fees through December 31, 1999 with re-
spect to Foreign Value which amounted to $12,191.
Quantitative Institutional Services also provides the Fund with other services
consisting of in-house legal services, preparation and review of semi-annual
and annual reports and development of internet based shareholder services sys-
tems. These services are provided as additional services agreed to by the
Trustees under the provisions of the Transfer Agent and Services Agreement.
During the year ended March 31, 2000, the aggregate fees paid by the Funds
pursuant to such agreement amounted to $169,557.
Custody and fund accounting services are provided by State Street Kansas City.
Custody credits generated by interest earned on uninvested cash balances main-
tained by the Funds are used to offset custodial expenses of the Funds. For
the year ended March 31 2000, State Street voluntarily agreed to waive its
minimum fees in part with respect to Foreign Value, which amounted to $7,500.
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.
For the year ended March 31, 2000, certain reclassification adjustments were
made between undistributed net investment income/(loss), accumulated net real-
ized gain/(loss), and shares of beneficial interest due to differences between
book and tax accounting, primarily due to March 31 year-end net operating
losses for Small Cap, Mid Cap and Growth and Income, passive foreign invest-
ment company holdings for International Equity, Emerging Markets and Foreign
Value, and currency translation for International Equity, Emerging Markets and
Foreign Value.
At March 31, 2000 Emerging Markets had a capital loss carry-over amounting to
$2,026,159 which will expire on March 31, 2007. Foreign Value had a capital
loss carry-over amounting to $359,523 of which $281,817 will expire on March
31, 2007 and $77,706 will expire on March 31, 2008. Emerging Markets and For-
eign Value also had a post October loss deferrals amounting to $157,851 and
$159,750, respectively. 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 the Funds for gains realized and not dis-
tributed.
5. Purchases and Sales.
During the year ended March 31, 2000, purchases of investment securities other
than U.S. Government obligations and
- -------------------------------------------------------------------------------
32
<PAGE>
[LOGO OF QUANT]
NOTES TO FINANCIAL STATEMENTS--Continued
short-term investments, for Small Cap, Mid Cap, Growth and Income, Interna-
tional Equity, Emerging Markets and Foreign Value were $85,602,083,
$22,205,420, $61,858,335, $16,432,927, $5,170,792 and $7,505,738, respective-
ly. Sales of such securities for the Funds were $93,568,882, $25,004,783,
$73,241,234, $23,263,257, $3,926,970, and $3,280,634, respectively.
6. Securities Loans.
As of March 31, 2000, International Equity loaned common stocks having a value
of $919,909 and received cash collateral of $955,918 for these loans.
Security lending income of $10,031 collected by State Steet was recorded in
interest income on the Statement of Operations.
7. Line of Credit and Contingent Liability.
Small Cap, Mid Cap, International Equity, Emerging Markets and Foreign Value
share in a $2,000,000 unsecured committed revolving line of credit with State
Street Bank and Trust Company for temporary or emergency purposes. Pursuant to
the line of credit agreement, the Funds may borrow up to 10%, 10%, 10%, 5% and
10%, respectively, of each Funds' net asset value up to certain limits set
forth in the allocation procedures approved by the Trustees. Such borrowings
are due not more than 60 days from the date of borrowing, with interest, as
determined by the line of credit agreement. At March 31, 2000 there were no
outstanding balances under the line of credit.
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.
8. Shares of Beneficial Interest.
The following schedule shows the number of shareholders each owning 5% or more
of a class of shares of a Fund and the total percentage of the class held by
such shareholders.
<TABLE>
<CAPTION>
5% or Greater
Shareholders
----------------------
Fund Number % of Class Held
<S> <C> <C>
Small Cap Inst. 7 70%
Mid Cap Ord. 2 13%
Mid Cap Inst. 6 79%
Growth and Income Inst. 3 63%
International Equity Inst. 3 95%
Emerging Markets Inst. 4 95%
Foreign Value Inst. 4 99%
</TABLE>
9. 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.
- -------------------------------------------------------------------------------
33
<PAGE>
NOTES TO FINANCIAL STATEMENTS--Continued
10. Transactions in Shares of Beneficial Interest.
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
Year Ended Year Ended
March 31, 2000 March 31, 1999
--------------------- ----------------------
Shares Dollars Shares Dollars
<S> <C> <C> <C> <C>
Small Cap
Ordinary Shares:
Shares sold 198,309 $ 3,707,730 321,309 $ 4,921,114
Shares issued in reinvestment
of distributions -- -- -- --
Shares redeemed (464,611) (8,596,371) (819,305) (12,593,183)
-------- ----------- -------- ------------
Net change (266,302) (4,888,641) (497,996) (7,672,069)
======== ----------- ======== ------------
Institutional Shares:
Shares sold 51,217 1,056,317 165,132 2,572,359
Shares issued in reinvestment
of distributions -- -- -- --
Shares redeemed (108,815) (1,885,316) (198,357) (3,132,927)
-------- ----------- -------- ------------
Net change (57,598) (828,999) (33,225) (560,568)
======== ----------- ======== ------------
Total net change for fund $(5,717,640) $ (8,232,637)
=========== ============
Mid Cap
Ordinary Shares:
Shares sold 118,230 $ 2,511,461 130,228 $ 2,026,572
Shares issued in reinvestment
of distributions 56,085 1,013,460 23,434 339,321
Shares redeemed (183,316) (3,427,844) (302,112) (4,291,004)
-------- ----------- -------- ------------
Net change (9,001) 97,077 (148,450) (1,925,111)
======== ----------- ======== ------------
Institutional Shares:
Shares sold 16,584 363,736 24,035 385,114
Shares issued in reinvestment
of distributions 2,533 46,385 1,327 19,447
Shares redeemed (15,600) (326,063) (40,432) (637,880)
-------- ----------- -------- ------------
Net change 3,517 84,058 (15,070) (233,319)
======== ----------- ======== ------------
Total net change for fund $ 181,135 $ (2,158,430)
=========== ============
Growth and Income
Ordinary Shares:
Shares sold 167,523 $ 3,868,631 360,216 $ 7,546,886
Shares issued in reinvestment
of distributions 640,292 14,009,592 298,358 6,059,646
Shares redeemed (414,615) (9,357,746) (508,956) (10,464,456)
-------- ----------- -------- ------------
Net change 393,200 8,520,477 149,618 3,142,076
======== ----------- ======== ------------
Institutional Shares:
Shares sold 22,748 542,541 59,785 1,255,152
Shares issued in reinvestment
of distributions 29,337 649,232 13,464 274,384
Shares redeemed (177,920) (4,075,586) (36,264) (743,619)
-------- ----------- -------- ------------
Net change (125,835) (2,883,813) 36,985 785,917
======== ----------- ======== ------------
Total net change for fund $ 5,636,664 $ 3,927,993
=========== ============
</TABLE>
- --------------------------------------------------------------------------------
34
<PAGE>
NOTES TO FINANCIAL STATEMENTS--Continued
<TABLE>
<CAPTION>
Year Ended Year Ended
March 31, 2000 March 31, 1999
--------------------- ----------------------
Shares Dollars Shares Dollars
<S> <C> <C> <C> <C>
International Equity
Ordinary Shares:
Shares sold 82,908 $ 971,911 201,594 $ 2,372,212
Shares issued in reinvestment
of distributions 98,828 1,172,103 4,912 54,669
Shares redeemed (488,421) (5,787,344) (964,017) (11,074,145)
-------- ----------- -------- ------------
Net change (306,685) (3,643,330) (757,511) (8,647,264)
======== ----------- ======== ------------
Institutional Shares:
Shares sold 69,058 808,819 21,428 259,064
Shares issued in reinvestment
of distributions 8,932 105,933 587 6,538
Shares redeemed (230,052) (2,689,492) (218) (2,647)
-------- ----------- -------- ------------
Net change (152,062) (1,774,740) 21,797 262,955
======== ----------- ======== ------------
Total net change for fund $(5,418,070) $ (8,384,309)
=========== ============
Emerging Markets
Ordinary Shares:
Shares sold 214,337 $ 1,805,946 237,299 $ 1,587,802
Shares issued in reinvestment
of distributions 2,277 19,809 14,903 87,929
Shares redeemed (138,122) (1,303,824) (171,261) (1,078,284)
-------- ----------- -------- ------------
Net change 78,492 521,931 80,941 597,447
======== ----------- ======== ------------
Institutional Shares:
Shares sold 111,346 1,074,829 88,509 526,429
Shares issued in reinvestment
of distributions 169 1,478 404 2,398
Shares redeemed (34,440) (300,540) (2) (15)
-------- ----------- -------- ------------
Net change 77,075 775,767 88,911 528,812
======== ----------- ======== ------------
Total net change for fund $ 1,297,698 $ 1,126,259
=========== ============
Foreign Value
Ordinary Shares:
Shares sold 711,647 $ 6,619,414 964,692 $ 8,959,698
Shares issued in reinvestment
of distributions 53,026 473,523 2,345 19,694
Shares redeemed (157,119) (1,438,775) (72,777) (646,297)
-------- ----------- -------- ------------
Net change 607,554 5,654,162 *894,260 8,333,095
======== ----------- ======== ------------
Institutional Shares:
Shares sold 124,779 1,138,343 47,949 403,246
Shares issued in reinvestment
of distributions 342 3,051 -- --
Shares redeemed (40,152) (377,415) -- --
-------- ----------- -------- ------------
Net change 84,969 763,979 *47,949 403,246
======== ----------- ======== ------------
Total net change for fund $ 6,418,141 $ 8,736,341
=========== ============
</TABLE>
* From the commencement of operations on May 15, 1998.
- --------------------------------------------------------------------------------
35
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Trustees of the Quantitative Group of Funds
In our opinion, the accompanying statement of assets and liabilities, includ-
ing the portfolio of investments, and the related statements of operations and
of changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of each of the portfolios constitut-
ing the Quantitative Group of Funds (hereafter referred to as the "Funds") at
March 31, 2000, the results of each of their operations for the year then end-
ed, the changes in each of their net assets and the financial highlights for
each of the periods indicated, in conformity with accounting principles gener-
ally accepted in the United States. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the responsi-
bility of the Funds' management; our responsibility is to express an opinion
on these financial statements based on our audits. We conducted our audits of
these financial statements in accordance with auditing standards generally ac-
cepted in the United States, which require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evi-
dence supporting the amounts and disclosures in the financial statements, as-
sessing the accounting principles used and significant estimates made by man-
agement, and evaluating the overall financial statement presentation. We be-
lieve that our audits, which included confirmation of securities at March 31,
2000 by correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
PricewaterhouseCoopers LLP
Kansas City, MO
May 8, 2000
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36
