<PAGE>
AMERICAN FUNDS INSURANCE SERIES
PART B
STATEMENT OF ADDITIONAL INFORMATION
APRIL 1, 2000
(as amended August 7, 2000)
This document is not a prospectus but should be read in conjunction with the
current prospectuses of American Funds Insurance Series (the "Series") dated
April 1, 2000. The prospectuses may be obtained from your investment dealer or
financial planner or by writing to the Series at the following address:
AMERICAN FUNDS INSURANCE SERIES
Attention: Secretary
333 South Hope Street
Los Angeles, CA 90071
(213) 486-9200
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ITEM PAGE
NO.
<S> <C>
Certain Investment Limitations and Guidelines 2
Description of Certain Securities and Investment 6
Techniques
Fundamental Policies and Investment Restrictions 18
Series Organization and Voting Rights 22
Series Trustees and Officers 23
Management 27
Price of Shares 30
Dividends, Distributions and Federal Taxes 31
Execution of Portfolio Transactions 32
General Information 33
Description of Commercial Paper Ratings 34
Financial Statements Attached
</TABLE>
CERTAIN INVESTMENT LIMITATIONS AND GUIDELINES
The following limitations and guidelines are considered at the time of
purchase, under normal market conditions, and are based on a percentage of the
fund's net assets unless otherwise noted. This summary is not intended to
reflect all of the fund's investment limitations.
GLOBAL GROWTH FUND
Non-U.S. Securities
- The fund will invest in issuers domiciled in at least three countries.
- The fund may invest up to 40% of its assets in securities of issuers
domiciled in any one country (excluding cash that is U.S. dollar
denominated).
- The fund may invest in the securities of issuers domiciled in less developed
and developing countries.
Debt Securities
- The fund may invest up to 10% of its assets in straight debt securities rated
BBB or Baa or below by S&P or Moody's (or unrated but determined to be
equivalent)
GLOBAL SMALL CAPITALIZATION FUND
Equity Securities
- The fund will invest at least 65% of its total assets in equity securities of
small capitalization issuers (market capitalizations of $50 million to $1.5
billion based on U.S. share prices)
Non-U.S. Securities
- The fund may invest in securities of issuers domiciled outside the U.S.,
including issuers in less developed and developing countries.
Debt Securities
- The fund may invest in debt securities generally rated in the top three
categories by S&P or Moody's (or unrated but determined to be equivalent)
GROWTH FUND
Non-U.S. Securities
- The fund may invest up to 15% of its assets in securities of issuers
domiciled outside the U.S. and Canada and not included in the S&P 500.
Debt Securities
- The fund may invest up to 10% of its assets on straight debt securities rated
Ba and BB or below by S&P or Moody's or unrated by determined to be of
equivalent quality.
INTERNATIONAL FUND
Equity Securities
- The fund will invest at least 65% of its assets in equity securities
(including depositary receipts) of issuers domiciled outside the U.S.; however,
under normal market conditions, the fund will invest substantially all of its
assets in issuers domiciled outside the U.S. The fund may also invest in the
securities of issuers domiciled in less developed and developing countries.
Debt Securities
- The fund may invest up to 5% of its assets in straight debt securities rated
BBB or Baa or below by S&P or Moody's or unrated but determined to be of
equivalent quality.
NEW WORLD FUND
General
- The fund will invest at least 35% of its assets in equity and debt securities
of companies primarily based in qualified countries which have developing
economies and/or markets.
Equity Securities
- The fund may invest the balance of its assets in equity securities of any
company regardless of where it is based, provided the adviser has determined
that a significant portion of its assets or revenues (generally 20% or more)
are attributable to developing countries.
Debt Securities
- The fund may invest up to 25% of its assets in debt securities of issuers
primarily based in qualified countries which have developing economies and/or
markets, or issuers that the fund's investment adviser determines has a
significant portion of its assets or revenues (generally 20% or more)
attributable to developing countries.
- The fund may invest up to 25% of its assets in straight debt securities rated
Ba and BB or below by S&P or Moody's or unrated but determined to be of
equivalent quality
GROWTH-INCOME FUND
Non-U.S. Securities
- The fund may invest up to 10% of its assets in equity securities of issuers
domiciled outside U.S. and not in the S&P 500.
Debt Securities
- The fund may invest up to 5% of its assets on straight debt securities rated
Ba and BB or below by S&P or Moody's or unrated but determined to be of
equivalent quality.
ASSET ALLOCATION FUND
General
- The fund will generally invest 40% to 80% of its assets in equity securities;
20% to 50% in debt securities; and 0% to 40% in money market instruments
(including cash).
Debt Securities
- The fund may invest up to 25% of the fund's assets in straight debt
securities rated Ba and BB below by S&P or Moody's or unrated by determined to
be of equivalent quality.
Non-U.S. Securities
- The fund may invest up to 10% of its assets in equity-type securities of
issuers domiciled outside the U.S. and not in the S&P 500.
- The fund may invest up to 5% of its assets in debt securities of issuers
domiciled outside the U.S.
BOND FUND
Equity Securities
- The fund may not purchase equity securities directly, but may retain up to 5%
of its assets in common stock, warrants and rights after the sale of the
corresponding debt securities.
Debt Securities
- The fund will invest at least 65% of its assets in bonds (debt securities
having initial maturities in excess of one year)
- The fund will invest at least 35% of its assets in debt securities (including
cash and cash equivalents) rated A or better by Moody's or S&P or unrated but
determined to be of equivalent quality.
- The fund will invest at least 65% of its assets in debt securities (including
cash and cash equivalents) that are rated BBB or Baa or better by Moody's or
S&P.
- The fund may invest up to 35% of its assets in straight debt securities rated
Ba and BB or below by Moody's or S&P or unrated but determined to be of
equivalent quality.
Non-U.S. Securities
- The fund may invest up to 20% of its assets in non-U.S. dollar denominated
securities.
- The fund may invest in the securities of issuers domiciled in less developed
and developing countries.
HIGH-YIELD BOND FUND
Debt Securities
- The fund will invest at least 65% of its assets in debt securities rated Ba
or BB or below by Moody's or S&P or unrated but determined to be of equivalent
quality.
Equity and Other Securities
- The fund may invest up to 25% of its assets in common and preferred stocks
and convertibles.
Maturity
- The fund will invest in securities with maturities in excess of 3 years.
Non-U.S. Securities
- The fund may invest up to 25% of its assets in securities of issuers
domiciled outside the U.S.
- The fund may invest in the securities of issuers domiciled in less developed
and developing countries.
U.S. GOVERNMENT/AAA-RATED SECURITIES FUND
General
- The fund will invest at least 65% of its assets in securities guaranteed by
the "full faith and credit" pledge of the U.S. Government or debt securities
rated AAA by S&P or Aaa by Moody's or unrated but determined to be of
equivalent quality.
CASH MANAGEMENT FUND
General
- The fund will invest in high quality money market instruments rated in the
two highest quality categories by either Moody's or S&P, provided the issuer
has commercial paper rated in the highest rating category by Moody's or S&P.
Maturity
- The fund may purchase securities that mature or may be redeemed in 13 months
or less (25 months or less if U.S. Government securities), even if original
maturity is greater than 1 year.
DESCRIPTION OF CERTAIN SECURITIES AND INVESTMENT TECHNIQUES
With respect to all funds, portfolio changes will be made without regard to the
length of time a particular investment may have been held.
EQUITY SECURITIES -- Equity securities represent an ownership position in a
company. These securities may include common stocks and securities with equity
conversion or purchase rights. The prices of equity securities fluctuate based
on changes in the financial condition of their issuers and on market and
economic conditions. The funds' results will be related to the overall market
for these securities.
DEBT SECURITIES -- Bonds and other debt securities are used by issuers to
borrow money. Issuers pay investors interest and must repay the amount borrowed
at maturity. Some debt securities, such as zero coupon bonds, do not pay
current interest but are purchased at a discount from their face values. The
prices of debt securities fluctuate depending on such factors as interest
rates, credit quality and maturity. In general their prices decline when
interest rates rise and vice versa.
Lower quality, lower rated bonds rated Ba or below by Standard & Poor's
Corporation and BB or below by Moody's Investors Services, Inc. (or unrated but
considered to be of equivalent quality) are described by the rating agencies as
speculative and involve greater risk of default or price changes due to changes
in the issuer's creditworthiness than higher rated bonds, or they may already
be in default. The market prices of these securities may fluctuate more than
higher quality securities and may decline significantly in periods of general
economic difficulty. It may be more difficult to dispose of, or to determine
the value of, lower quality, lower rated bonds.
Certain risk factors relating to "lower quality, lower rated bonds" are
discussed below.
SENSITIVITY TO INTEREST RATE AND ECONOMIC CHANGES - Lower quality, lower rated
bonds can be sensitive to adverse economic changes and political and corporate
developments and may be less sensitive to interest rate changes. During an
economic downturn or substantial period of rising interest rates, highly
leveraged issuers may experience financial stress that would adversely affect
their ability to service their principal and interest payment obligations, to
meet projected business goals, and to obtain additional financing. In
addition, periods of economic uncertainty and changes can be expected to result
in increased volatility of market prices and yields of lower quality, lower
rated bonds.
PAYMENT EXPECTATIONS - Lower quality, lower rated bonds, like other bonds, may
contain redemption or call provisions. If an issuer exercises these provisions
in a declining interest rate market, a fund would have to replace the security
with a lower yielding security, resulting in a decreased return for investors.
If the issuer of a bond defaults on its obligations to pay interest or
principal or enters into bankruptcy proceedings, the fund may incur losses or
expenses in seeking recovery of amounts owed to it.
LIQUIDITY AND VALUATION - There may be little trading in the secondary market
for particular bonds, which may affect adversely a fund's ability to value
accurately or dispose of such bonds. Adverse publicity and investor
perceptions, whether or not based on fundamental analysis, may decrease the
values and liquidity of lower quality, lower rated bonds, especially in a thin
market.
Capital Research and Management Company attempts to reduce the risks described
above through diversification of the portfolios and by credit analysis of each
issuer as well as by monitoring broad economic trends and corporate and
legislative developments, but there can be no assurance that it will be
successful in doing so.
SECURITIES WITH EQUITY AND DEBT CHARACTERISTICS -- The funds may also invest
in securities that have a combination of equity and debt characteristics such
as non-convertible preferred stocks and convertible securities. These
securities may at times resemble equity more than debt and vice versa. The
risks of convertible preferred stocks may be similar to those of equity
securities. Some types of convertible preferred stocks automatically convert
into common stock. Non-convertible preferred stock with stated redemption rates
are similar to debt in that they have a stated dividend rate akin to the coupon
of a bond or note even though they are often classified as equity securities.
The prices and yields of non-convertible preferred stocks generally move with
changes in interest rates and the issuer's credit quality, similar to the
factors affecting debt securities.
Bonds, preferred stocks, and other securities may sometimes be converted into
shares of common stock or other securities at a stated exchange ratio. These
securities prior to conversion pay a fixed rate of interest or a dividend.
Because convertible securities have both debt and equity characteristics their
value varies in response to many factors, including the value of the underlying
equity, general market and economic conditions, convertible market valuations,
as well as changes in interest rates, credit spreads, and the credit quality of
the issuer.
INVESTING IN SMALLER CAPITALIZATION STOCKS -- The funds' may invest in the
stocks of smaller companies (typically with market capitalizations of less than
$1.5 billion at the time of purchase). Capital Research and Management Company
believes that the issuers of smaller capitalization stocks often provide
attractive investment opportunities. However, investing in smaller
capitalization stocks can involve greater risk than is customarily associated
with investing in stocks of larger, more established companies. For example,
smaller companies often have limited product lines, markets, or financial
resources, may be dependent for management on one or a few key persons, and can
be more susceptible to losses. Also, their securities may be thinly traded (and
therefore have to be sold at a discount from current prices or sold in small
lots over an extended period of time), may be followed by fewer investment
research analysts, and may be subject to wider price swings thus creating a
greater chance of loss than securities of larger capitalization companies.
Because the Global Small Capitalization Fund in particular emphasizes the
stocks of issuers with smaller market capitalizations (by U.S. standards), it
can be expected to have more difficulty obtaining information about the issuers
or valuing or disposing of its securities than if it were to concentrate on
more larger capitalization stocks. The funds determine relative market
capitalizations using U.S. standards. Accordingly, the funds' non-U.S.
investments may have large capitalizations relative to market capitalizations
of companies based outside the U.S.
INVESTING IN VARIOUS COUNTRIES -- The Global Growth Fund, the Global Small
Capitalization Fund, the Growth Fund, the International Fund, the New World
Fund, the Growth-Income Fund, the Asset Allocation Fund, the Bond Fund and the
High-Yield Bond Fund may invest in securities of issuers domiciled outside the
U.S. and which may be denominated in currencies other than the U.S. dollar.
Investing outside the U.S. involves special risks, caused by, among other
things: currency controls; fluctuating currency values; different accounting,
auditing, and financial reporting regulations and practices in some countries;
changing local and regional economic, political, and social conditions;
expropriation and confiscatory taxation; greater market volatility; differing
securities market structures; and various administrative difficulties such as
delays in clearing and settling portfolio transactions or in receiving payment
of dividends. However, in the opinion of Capital Research and Management
Company, investing outside the U.S. also can reduce certain portfolio risks due
to greater diversification opportunities.
The risks described above are potentially heightened in connection with
investments in less developed and developing countries. Although there is no
universally accepted definition, a developing country is generally considered
to be a country which is in the initial stages of its industrialization cycle
with a low per capita gross national product. For example, political and/or
economic structures in these countries may be in their infancy and developing
rapidly. Historically, the markets of developing countries have been more
volatile than the markets of developed countries.
Additional costs could be incurred in connection with the funds' investment
activities outside the U.S. Brokerage commissions are generally higher outside
the U.S., and the funds will bear certain expenses in connection with their
currency transactions. Furthermore, increased custodian costs may be associated
with the maintenance of assets in certain jurisdictions.
The U.S. Government/AAA-Rated Securities Fund may purchase obligations of
non-U.S. corporations or governmental entities, provided they are U.S. dollar
denominated and highly liquid. Accordingly, while the risks mentioned above are
still present, they are present to a lesser extent.
Certain risk factors related to developing countries are discussed below.
CURRENCY FLUCTUATIONS - Certain funds may invest in securities valued in
currencies other than the U.S. dollar. Certain developing countries' currencies
have experienced and may in the future experience significant declines against
the U.S. dollar. For example, if the U.S. dollar appreciates against foreign
currencies, the value of the fund's securities holdings would generally
depreciate and vice versa. Consistent with its investment objective, the fund
can engage in certain currency transactions to hedge against currency
fluctuations. See "Currency Transactions" below.
GOVERNMENT REGULATION - The political, economic, and social structures of
certain developing countries may be more volatile and less developed than those
in the U.S. Certain developing countries lack uniform accounting, auditing,
and financial reporting standards, have less governmental supervision of
financial markets than in the U.S., and do not honor legal rights enjoyed in
the U.S. Certain governments may be more unstable and present greater risks of
nationalization or restrictions on foreign ownership of local companies.
Repatriation of investment income, capital, and the proceeds of sales by
foreign investors may require governmental registration and/or approval in some
developing market countries. While the fund will only invest in markets where
these restrictions are considered acceptable, a country could impose new or
additional repatriation restrictions after the funds' investment. If this
happened, the fund's response might include, among other things, applying to
the appropriate authorities for a waiver of the restrictions or engaging in
transactions in other markets designed to offset the risks of decline in that
country. Such restrictions will be considered in relation to the fund's
liquidity needs and all other positive and negative factors. Further, some
attractive equity securities may not be available to the fund because foreign
shareholders hold the maximum amount legally permissible.
While government involvement in the private sector varies in degree among
developing countries, such involvement may in some cases, include government
ownership of companies in certain sectors, wage and price controls or
imposition of trade barriers and other protectionist measures. With respect to
any developing country, there is no guarantee that some future economic or
political crisis will not lead to price controls, forced mergers of companies,
expropriation, or creation of government monopolies to the possible detriment
of the fund's investments.
LESS DEVELOPED SECURITIES MARKETS - Developing countries may have less
well-developed securities markets and exchanges. They have lower trading
volumes than the securities markets of more developed countries. These markets
may be unable to respond effectively to increases in trading volume.
Consequently, these markets may be substantially less liquid than those of more
developed countries and the securities of issuers located in these markets may
have limited marketability. These factors may make prompt liquidation of
substantial portfolio holdings difficult or impossible at times.
SETTLEMENT RISKS - Settlement systems in developing countries are generally
less well organized in developed markets. Supervisory authorities may also be
unable to apply standards comparable with those in developed markets. Thus,
there may be risks that settlement may be delayed and that cash or securities
belonging to the fund may be in jeopardy because of failures of or defects in
the systems. In particular, market practice may require that payment be made
before receipt of the security being purchased or that delivery of a security
be made before payment is received. In such cases, default by a broker or bank
(the "counterparty") through whom the transaction is effected might cause the
funds to suffer a loss. The funds will seek, where possible, to use
counterparties whose financial status is such that this risk is reduced.
However, there can be no certainty that the funds will be successful in
eliminating this risk, particularly as counterparties operating in developing
countries frequently lack the substance or financial resources of those in
developed countries. There may also be a danger that, because of uncertainties
in the operation of settlement systems in individual markets, competing claims
may arise with respect to securities held by or to be transferred to the funds.
INVESTOR INFORMATION - The funds may encounter problems assessing investment
opportunities in certain developing securities markets in light of limitations
on available information and different accounting, auditing and financial
reporting standards. In such circumstances, the fund's investment adviser will
seek alternative sources of information, and to the extent the investment
adviser may not be satisfied with the sufficiency of the information obtained
with respect to a particular market or security, the funds will not invest in
such market or security.
TAXATION - Taxation of dividends and capital gains received by non-residents
varies among developing countries and, in some cases, is comparatively high.
In addition, developing countries typically have less well-defined tax laws and
procedures and such laws may permit retroactive taxation so that the funds
could in the future become subject to local tax liability that it had not
reasonably anticipated in conducting its investment activities or valuing its
assets.
LITIGATION - The funds and their shareholders may encounter substantial
difficulties in obtaining and enforcing judgments against non-U.S. resident
individuals and companies.
FRAUDULENT SECURITIES - Securities purchased by the funds may subsequently be
found to be fraudulent or counterfeit, resulting in a loss to the funds.
LOAN PARTICIPATIONS - New World Fund may invest, subject to its overall
limitation on debt securities, in loan participations, typically made by a
syndicate of banks to governmental or corporate borrowers for a variety of
purposes. The underlying loans to developing market governmental borrowers may
be in default and may be subject to restructuring under the Brady Plan. The
underlying loans may be secured or unsecured, and will vary in term and legal
structure. When purchasing such instruments the fund may assume the credit
risks associated with the original bank lender as well as the credit risks
associated with the borrower. Investment in loan participations present the
possibility that in the U.S., the fund could be held liable as a co-lender
under emerging legal theories of lender liability. In addition, if the loan is
foreclosed, the fund could be part owner of any collateral, and could bear the
costs and liabilities of owning and disposing of the collateral. Loan
participations are generally not rated by major rating agencies, may not be
protected by securities laws, and are often considered to be illiquid.
CURRENCY TRANSACTIONS -- The Global Growth Fund, Global Small Capitalization
Fund, Growth Fund, International Fund, New World Fund, Asset Allocation Fund,
Bond Fund and High-Yield Bond Fund can purchase and sell currencies to
facilitate securities transactions and enter into forward currency contracts to
protect against changes in currency exchange rates. The Growth-Income Fund
does not currently intend to engage in any transactions other than purchasing
and selling currencies and foreign exchange contracts which will be used to
facilitate settlement of trades. A forward currency contract is an obligation
to purchase or sell a specific currency at a future date, which may be any
fixed number of days from the date of the contract agreed upon by the parties,
at a price set at the time of the contract. Forward currency contracts entered
into by the funds will involve the purchase or sale of one currency against the
U.S. dollar. While entering into forward currency transactions could minimize
the risk of loss due to a decline in the value of the hedged currency, it could
also limit any potential gain which might result from an increase in the value
of the currency. The funds will not generally attempt to protect against all
potential changes in exchange rates. The funds will segregate liquid assets
which will be marked to market daily to meet its forward contract commitments
to the extent required by the Securities and Exchange Commission.
The Bond Fund and High-Yield Bond Fund may enter into the transactions
described above and may also enter into exchange-traded futures contracts
relating to foreign currencies ("currency contracts") in connection with
investments in securities of foreign issuers in anticipation of, or to protect
against, fluctuations in exchange rates. In addition, forward currency
contracts may be used by these funds to purchase or sell a currency against
another currency at a future date and price as agreed upon by the parties. An
exchange-traded futures contract relating to foreign currency is similar to a
forward foreign currency contract but has a standardized size and exchange
date. Although currency contracts typically will involve the purchase and sale
of a currency against the U.S. dollar, these funds also may enter into currency
contracts not involving the U.S. dollar. In connection with these futures
transactions, the Series has filed a notice of eligibility with the Commodities
Futures Trading Association ("CFTC") that exempts the Series from CFTC
registration as a "commodity pool operator" as defined under the Commodities
Exchange Act. Pursuant to this notice, these funds will observe certain CFTC
guidelines with respect to its futures transactions that, among other things,
limit initial margin deposits in connection with the use of futures contracts
and related options for purposes other than "hedging" (as defined by CFTC
rules) up to 5% of a fund's net assets.
The Bond Fund and High-Yield Bond Fund may attempt to accomplish objectives
similar to those involved in their use of currency contracts by purchasing put
or call options on currencies. A put option gives a fund, as purchaser, the
right (but not the obligation) to sell a specified amount of currency at the
exercise price until the expiration of the option. A call option gives a fund,
as purchaser, the right (but not the obligation) to purchase a specified amount
of currency at the exercise price until its expiration. The funds might
purchase a currency put option, for example, to protect themselves during the
contract period against a decline in the U.S. dollar value of a currency in
which they hold or anticipate holding securities. If the currency's value
should decline against the U.S. dollar, the loss in currency value should be
offset, in whole or in part, by an increase in the value of the put. If the
value of the currency instead should rise against the U.S. dollar, any gain to
the funds would be reduced by the premium they had paid for the put option. A
currency call option might be purchased, for example, in anticipation of, or to
protect against, a rise in the value against the U.S. dollar of a currency in
which the funds anticipate purchasing securities.
Currency options may be either listed on an exchange or traded over-the-counter
("OTC options"). Listed options are third-party contracts (I.E., performance
of the obligations of the purchaser and seller is guaranteed by the exchange or
clearing corporation) and have standardized strike (exercise) prices and
expiration dates. OTC options are two-party contracts with negotiated strike
prices and expiration dates. The High-Yield Bond Fund and Bond Fund will not
purchase an OTC option unless it is believed that daily valuations for such
options are readily obtainable. OTC options differ from exchange-traded
options in that OTC options are transacted with dealers directly and not
through a clearing corporation which guarantees performance. Consequently,
there is a risk of non-performance by the dealer. Since no exchange is
involved, OTC options are valued on the basis of a quote provided by the
dealer. In the case of OTC options, there can be no assurance that a liquid
secondary market will exist for any particular option at any specific time.
Certain provisions of the Internal Revenue code may limit the extent to which
the fund may enter into forward contracts. Such transactions may also affect,
for U.S. federal tax purposes, the character and timing of income, gain or loss
recognized by the fund.
FORWARD COMMITMENTS -- The funds may enter into commitments to purchase or sell
securities at a future date. When a fund agrees to purchase such securities it
assumes the risk of any decline in value of the securities beginning on the
date of the agreement. When a fund agrees to sell such securities, it does not
participate in further gains or losses. If the other party to such a
transaction fails to deliver or pay for the securities, a fund could miss a
favorable price or yield opportunity, or could experience a loss.
As the funds' aggregate commitments under these transactions increase, the
opportunity for leverage similarly increases. The funds will not use these
transactions for the purpose of leveraging and will segregate liquid assets
which will be marked to market daily in an amount sufficient to meet their
payment obligations in these transactions. Although these transactions will not
be entered into for leveraging purposes, to the extent the funds' aggregate
commitments under these transactions exceed their segregated assets, the funds
temporarily could be in a leveraged position (because they may have an amount
greater than their net assets subject to market risk). Should the market values
of the funds' portfolio securities decline while the funds are in a leveraged
position, greater depreciation of their net assets would likely occur than were
they not in such a position. The funds will not borrow money to settle these
transactions and therefore, will liquidate other portfolio securities in
advance of settlement if necessary to generate additional cash to meet their
obligations thereunder.
The Asset Allocation Fund, Bond Fund, High-Yield Bond Fund, and U.S.
Government/AAA-Rated Securities Fund also may enter into "roll" transactions
which are the sale of mortgage-backed or other securities together with a
commitment to purchase similar, but not identical, securities at a later date.
The funds assume the rights and risks of ownership, including the risk of price
and yield fluctuations as of the time of the agreement. The funds intend to
treat roll transactions as two separate transactions: one involving the
purchase of a security and a separate transaction involving the sale of a
security. Since the funds do not intend to enter into roll transactions for
financing purposes, they may treat these transactions as not falling within the
definition of "borrowing" set forth in Section 2(a)(23) of the Investment
Company Act of 1940 (the "1940 Act"). The funds will segregate liquid assets
which will be marked to market daily in an amount sufficient to meet their
payment obligations in these transactions.
REPURCHASE AGREEMENTS -- The funds may enter into repurchase agreements, under
which they buy a security and obtain a simultaneous commitment from the seller
to repurchase a security at a specified time and price. The seller must
maintain with the Series' custodian collateral equal to at least 100% of the
repurchase price including accrued interest as monitored daily by Capital
Research and Management Company. The funds will only enter into repurchase
agreements involving securities in which they could otherwise invest and with
selected banks and securities dealers whose financial condition is monitored by
Capital Research and Management Company. If the seller under the repurchase
agreement defaults, a fund may incur a loss if the value of the collateral
securing the repurchase agreement has declined and may incur disposition costs
in connection with liquidating the collateral. If bankruptcy proceedings are
commenced with respect to the seller, liquidation of the collateral by a fund
may be delayed or limited.
U.S. GOVERNMENT SECURITIES -- Securities guaranteed by the U.S. Government
include direct obligations of the U.S. Treasury (such as Treasury bills, notes
and bonds). For these securities, the payment of principal and interest is
unconditionally guaranteed by the U.S. Government, and thus they are of the
highest possible credit quality. Such securities are subject to variations in
market value due to fluctuations in interest rates, but, if held to maturity,
will be paid in full.
Certain securities issued by U.S. Government instrumentalities and certain
federal agencies are neither direct obligations of, nor guaranteed by, the
Treasury. However, they generally involve federal sponsorship in one way or
another: some are backed by specific types of collateral; some are supported by
the issuer's right to borrow from the Treasury; some are supported by the
discretionary authority of the Treasury to purchase certain obligations of the
issuer; and others are supported only by the credit of the issuing government
agency or instrumentality. These agencies and instrumentalities include, but
are not limited to, Farmers Home Administration, Federal Home Loan Bank,
Federal Home Loan Mortgage Corporation, Federal National Mortgage Association,
Tennessee Valley Authority, and Federal Farm Credit Bank System.
PASS-THROUGH SECURITIES -- The funds may invest in various debt obligations
backed by a pool of mortgages or other assets including loans on single family
residences, home equity loans, mortgages on commercial buildings, credit card
receivables, and leases on airplanes or other equipment. Principal and interest
payments made on the underlying asset pools backing these obligations are
typically passed through to investors. Pass-through securities may have either
fixed or adjustable coupons. These securities include those discussed below.
"Mortgage-backed securities" are issued both by U.S. government agencies,
including the Government National Mortgage Association (GNMA), the Federal
National Mortgage Association (FNMA), and the Federal Home Loan Mortgage
Corporation (FHLMC), and by private entities. The payment of interest and
principal on securities issued by U.S. Government agencies is guaranteed by the
full faith and credit of the U.S. government (in the case of GNMA securities)
or the issuer (in the case of FNMA and FHLMC securities). However, the
guarantees do not apply to the market prices and yields of these securities,
which vary with changes in interest rates.
Mortgage-backed securities issued by private entities are structured similarly
to mortgage-backed securities issued by GNMA, FNMA and FHLMC. These securities
and the underlying mortgages are not guaranteed by government agencies. In
addition, these securities generally are structured with one or more types of
credit enhancement. Mortgage-backed securities generally permit borrowers to
prepay their underlying mortgages. Prepayments can alter the effective maturity
of these instruments.
"Collateralized mortgage obligations" (CMOs) are backed by a pool of mortgages,
mortgage-backed securities or mortgage loans, which are divided into two or
more separate bond issues. CMOs issued by U.S. government agencies are backed
by agency mortgages. Payments of principal and interest are passed-through to
each bond at varying schedules resulting in bonds with different coupons,
effective maturities, and sensitivities to interest rates. In fact, some CMOs
may be structured in a way that when interest rates change, the impact of
changing prepayment rates on these securities' effective maturities is
magnified.
"Commercial mortgage-backed securities" are backed by mortgages of commercial
property, such as hotels, office buildings, retail stores, hospitals, and other
commercial buildings. These securities may have a lower prepayment risk than
other mortgage-related securities because commercial mortgage loans generally
prohibit or impose penalties on prepayments of principal. In addition,
commercial mortgage-related securities often are structured with some form of
credit enhancement to protect against potential losses on the underlying
mortgage loans. Many of the risks of investing in commercial mortgage-backed
securities reflect the risks of investing in the real estate securing the
underlying mortgage loans, including the effects of local and other economic
conditions on real estate markets, the ability of tenants to make loan
payments, and the ability of a property to attract and retain tenants.
"Asset-backed securities" are backed by other assets such as a credit card,
automobile or consumer loan receivables, retail installment loans, or
participations in pools of leases. Credit support for these securities may be
based on the underlying assets and/or provided through credit enhancements by a
third party. The values of these securities are sensitive to changes in the
credit quality of the underlying collateral, the credit strength of the credit
enhancement, changes in interest rates, and at times the financial condition of
the issuer. Some asset-backed securities also may receive prepayments which can
change the securities' effective maturities.
"IOs and POs" are issued in portions or tranches with varying maturities and
characteristics; some tranches may only receive the interest paid on the
underlying mortgages (IOs) and others may only receive the principal payments
(POs); the values of Ios and Pos are extremely sensitive to interest rate
fluctuations and prepayment rates, and IOs are also subject to the risk of
early repayment of the underlying mortgages which will substantially reduce or
eliminate interest payments.
INFLATION-INDEXED BONDS -- Inflation-indexed notes and bonds are issued by
governments, their agencies or instrumentalities, or corporations. The
principal value of this type of bond is periodically adjusted according to
changes in the rate of inflation. The interest rate is generally fixed at
issuance; however, interest payments are based on an inflation adjusted
principal value. For example, in a period of falling inflation, principal
value will be adjusted downward, reducing the interest payable.
Repayment of the original bond principal upon maturity (as adjusted for
inflation) is guaranteed in the case of U.S. Treasury inflation-indexed bonds,
even during a period of deflation. However, the current market value of the
bonds is not guaranteed, and will fluctuate. The funds may also invest in other
bonds which may or may not provide a similar guarantee. If a guarantee of
principal is not provided, the adjusted principal value of the bond repaid at
maturity may be less than the original principal.
REAL ESTATE INVESTMENT TRUSTS -- The funds may invest in debt securities issued
by real estate investment trusts (REITs), which are pooled investment vehicles
that primarily invest in real estate or real estate related loans. REITs are
not taxed on income distributed to shareholders provided they meet requirements
imposed by the Internal Revenue Code. The risks associated with REIT debt
investments are similar to the risks of investing in corporate-issued debt. In
addition, the return on REITs is dependent on such factors as the skill of
management and the real estate environment in general. Debt that is issued by
REITs is typically rated by the credit rating agencies as investment grade or
above.
CASH AND CASH EQUIVALENTS -- These securities include (i) commercial paper
(E.G. short-term notes up to nine months in maturity issued by corporations,
governmental bodies or bank/corporation sponsored conduits (asset backed
commercial paper)), (ii) commercial bank obligations (E.G. certificates of
deposit, bankers' acceptances (time drafts on a commercial bank where the bank
accepts an irrevocable obligation to pay at maturity)), (iii) savings
association obligation and savings bank obligations (E.G. bank notes and
certificates of deposit issued by savings banks or savings associations), (iv)
securities of the U.S. government, its agencies or instrumentalities that
mature, or may be redeemed, in one year or less, and (v) corporate bonds and
notes that mature, or that may be redeemed, in one year or less.
"Commercial paper" is short-term notes (up to nine months) issued by companies
or governmental bodies. The Cash Management Fund may only purchase commercial
paper judged by the Investment Adviser to be of suitable investment quality.
This includes (a) commercial paper that is rated in the two highest categories
by Standard & Poor's Corporation and by Moody's Investors Service, Inc. or (b)
other commercial paper deemed on the basis of the issuer's creditworthiness to
be of a quality appropriate for the Cash Management Fund. (No more than 5% of
the Cash Management Fund's assets may be invested in commercial paper rated in
the second highest rating category by either Moody's or Standard & Poor's; no
more than the greater of 1% of the Cash Management Fund's assets or $1 million
may be invested in such securities of any one issuer.) See the Appendix for a
description of the ratings.
The commercial paper in which the Cash Management Fund may invest includes
variable amount master demand notes. Variable amount master demand notes
permit the Cash Management Fund to invest varying amounts at fluctuating rates
of interest pursuant to the agreement in the master note. These are direct
lending obligations between the lender and borrower, they are generally not
traded, and there is no secondary market. Such instruments are payable with
accrued interest in whole or in part on demand. The amounts of the instruments
are subject to daily fluctuations as the participants increase or decrease the
extent of their participations. Investments in these instruments are limited to
those that have a demand feature enabling the Cash Management Fund
unconditionally to receive the amount invested from the issuer upon seven or
fewer days' notice. (Generally, the Cash Management Fund attempts to invest in
instruments having a one-day notice provision). In connection with master
demand note arrangements, the Investment Adviser, subject to the direction of
the Trustees, monitors on an ongoing basis the earning power, cash flow, and
other liquidity ratios of the borrower and its ability to pay principal and
interest on demand. The Investment Adviser also considers the extent to which
the variable amount master demand notes are backed by bank letters of credit.
These notes generally are not rated by Moody's or Standard & Poor's. The Cash
Management Fund may invest in them only if it is deemed that at the time of
investment the notes are of comparable quality to the other commercial paper in
which the Cash Management Fund may invest. Master demand notes are considered
to have a maturity equal to the repayment notice period unless the Investment
Adviser has reason to believe that the borrower could not make timely repayment
upon demand.
"Commercial bank obligations" are certificates of deposit (interest-bearing
time deposits), bankers acceptances (time drafts drawn on a commercial bank
where the bank accepts an irrevocable obligation to pay at maturity)
representing direct or contingent obligations of commercial banks with assets
in excess of $1 billion, based on latest published reports, or other
obligations issued by commercial banks with assets of less than $1 billion if
the principal amount of such obligation is fully insured by the U.S.
Government.
The Cash Management Fund may purchase corporate obligations that mature or that
may be redeemed in one year or less. These obligations originally may have
been issued with maturities in excess of one year. The Cash Management Fund
may invest only in corporate bonds or notes of issuers having outstanding
short-term securities rated as described above in "Commercial Paper."
"Savings association obligations" include certificates of deposit
(interest-bearing time deposits) issued by savings banks or savings and loan
associations that have assets in excess of $1 billion, based on latest
published reports, or obligations issued by institutions with assets of less
than $1 billion if the principal amount of such obligation is fully insured by
the U.S. Government.
"Floating rate obligations" have a coupon rate that changes at least annually
and generally more frequently. The coupon rate is set in relation to money
market rates. The obligations, issued primarily by banks, other corporations,
governments and semi-governmental bodies, may have a maturity in excess of one
year. In some cases, the coupon rate may vary with changes in the yield on
Treasury bills or notes or with changes in LIBOR (London Interbank Offering
Rate). The Investment Adviser considers floating rate obligations to be liquid
investments because a number of U.S. and non-U.S. securities dealers make
active markets in these securities.
RESTRICTED SECURITIES AND LIQUIDITY -- The funds may purchase securities
subject to restrictions on resale. All such securities not actively traded will
be considered illiquid unless they have been specifically determined to be
liquid under procedures which have been adopted by the Series' Board of
Trustees, taking into account factors such as the frequency and volume of
trading, the commitment of dealers to make markets and the availability of
qualified investors, all of which can change from time to time. The funds may
incur certain additional costs in disposing of illiquid securities.
PORTFOLIO TURNOVER -- Under certain market conditions, the investment policies
of the Asset Allocation Fund, the Bond Fund, the High-Yield Bond Fund, and the
U.S. Government/AAA-Rated Securities Fund may result in higher portfolio
turnover than those of the other funds, although no fund's annual portfolio
turnover rate is expected to exceed 100%. A 100% annual portfolio turnover
rate would occur, for example, if all the investments in a fund's portfolio
(exclusive of securities with less than one year to maturity) were replaced in
a period of one year. High portfolio turnover involves correspondingly greater
brokerage commissions, to the extent such commissions are payable, and other
transaction costs, which will be borne directly by the fund involved.
REVERSE REPURCHASE AGREEMENTS -- Although the Bond Fund and the U.S.
Government/AAA-Rated Securities Fund have no current intention of doing so
during the next 12 months, each fund is authorized to enter into reverse
repurchase agreements. A reverse repurchase agreement is the sale of a
security by a fund and its agreement to repurchase the security at a specified
time and price. Each fund will segregate liquid assets which will be marked to
market daily in an amount sufficient to cover its obligations under reverse
repurchase agreements with broker-dealers (but no collateral is required on
reverse repurchase agreements with banks). Under the Investment Company Act of
1940 (the "1940 Act"), reverse repurchase agreements may be considered
borrowings by a fund. The use of reverse repurchase agreements by a fund
creates leverage which increases the fund's investment risk. As a fund's
aggregate commitments under these reverse repurchase agreements increase, the
opportunity for leverage similarly increases. If the income and gains on
securities purchased with the proceeds of reverse repurchase agreements exceed
the costs of the agreements, a fund's earnings or net asset value will increase
faster than otherwise would be the case; conversely, if the income and gains
fail to exceed the costs, a fund's earnings or net asset value would decline
faster than otherwise would be the case.
LOANS OF PORTFOLIO SECURITIES -- Although the Asset Allocation Fund, the Bond
Fund, the High-Yield Bond Fund and the U.S. Government/AAA-Rated Securities
Fund have no current intention of doing so during the next 12 months, these
funds are authorized to lend portfolio securities to selected securities
dealers or other institutional investors whose financial condition is monitored
by Capital Research and Management Company (the "Investment Adviser"). The
borrower must maintain with the Series' custodian collateral consisting of
cash, cash equivalents or U.S. Government securities equal to at least 100% of
the value of the borrowed securities, plus any accrued interest. The
Investment Adviser will monitor the adequacy of the collateral on a daily
basis. Each fund may at any time call a loan of its portfolio securities and
obtain the return of the loaned securities. Each fund will receive any
interest paid on the loaned securities and a fee or a portion of the interest
earned on the collateral. Each fund will limit its loans of portfolio
securities to an aggregate of 10% of the value of its total assets, determined
at the time any such loan is made.
LOAN PARTICIPATIONS AND ASSIGNMENTS -- The Bond Fund and High-Yield Bond Fund
may invest in loan participations or assignments, typically made by a syndicate
of banks to U.S. and non-U.S. corporate or governmental borrowers for a variety
of purposes. Loan participations are loans or other direct debt instruments
which are interests in amounts owed by a corporate, governmental or other
borrower to another party. They may represent amounts owed to lenders or
lending syndicates, to suppliers of goods or services, or to other parties. A
fund will have the right to receive payments of principal, interest and any
fees to which it is entitled only from the lender selling the participation and
only upon receipt by the lender of the payments from the borrower. In
connection with purchasing participations, a fund generally will have no right
to enforce compliance by the borrower with the terms of the loan agreement
relating to loan, nor any rights of set-off against the borrower, and the fund
may not directly benefit from any collateral supporting the loan in which it
has purchased the participation. As a result, the fund will assume the credit
risk of both the borrower and the lender that is selling the participation. In
the event of the insolvency of the lender selling a participation, a fund may
be treated as a general creditor of the lender and may not benefit from any
set-off between the lender and the borrower.
When a fund purchases assignments from lenders it will acquire direct rights
against the borrower on the loan. However, because assignments are arranged
through private negotiations between potential assignees and potential
assignors, the rights and obligations acquired by a fund as the purchaser of an
assignment may differ from, and be more limited than, those held by the
assigning lender. Because there is no liquid market for such securities, the
fund's anticipate that such securities could be sold only to a limited number
of institutional investors.
Investments in loan participations and assignments present the possibility that
the fund could be held liable as a co-lender under emerging legal theories of
lender liability. In addition, if the loan is foreclosed, a fund could be part
owner of any collateral, and could bear the costs and liabilities of owning and
disposing of the collateral. Loan participations and assignments are generally
not rated by major rating agencies, may not be protected by the securities
laws, and are generally considered to be illiquid.
REINSURANCE RELATED NOTES AND BONDS -- The High-Yield Bond Fund may invest in
reinsurance related notes and bonds. These instruments, which are typically
issued by special purpose reinsurance companies, transfer an element of
insurance risk to the note or bond holders. For example, the reinsurance
company would not be required to repay all or a portion of the principal value
of the notes or bonds if losses due to a catastrophic event under the policy
(such as a major hurricane) exceed certain dollar thresholds. Consequently,
the fund may lose the entire amount of its investment in such bonds or notes if
such an event occurs and losses exceed certain dollar thresholds. In this
instance, investors would have no recourse against the insurance company.
These instruments may be issued with fixed or variable interest rates and rated
in a variety of credit quality categories by the rating agencies.
PORTFOLIO TRADING OF FIXED-INCOME SECURITIES -- The funds intend to engage in
portfolio trading of fixed-income securities when it is believed that the sale
of a fixed-income security owned and the purchase of another security of better
value can enhance principal and/or increase income. A security may be sold to
avoid any prospective decline in market value in light of what is evaluated as
an expected rise in prevailing yields, or a security may be purchased in
anticipation of a market rise (a decline in prevailing yields). A security
also may be sold and a comparable security purchased concurrently in order to
take advantage of what is believed to be a disparity in the normal yield and
price relationship between the two securities.
FUNDAMENTAL POLICIES AND INVESTMENT RESTRICTIONS
The Series has adopted the following fundamental policies and investment
restrictions for each fund which may not be changed without approval by holders
of a majority vote of the funds' outstanding shares. Such majority is defined
in the Investment Company Act of 1940 ("1940 Act") as the vote of the lesser of
(I) 67% or more of the outstanding shares of the fund present at a meeting, if
the holders of more than 50% of the outstanding voting securities of the fund
are present in person or by proxy, or (ii) more than 50% of the outstanding
voting securities of the fund. All percentage limitations are considered at the
time securities are purchased and are based on the funds' net assets unless
otherwise indicated. None of the following investment restrictions involving a
maximum percentage of assets will be considered violated unless the excess
occurs immediately after, and is caused by, an acquisition by the fund.
INVESTMENT RESTRICTIONS OF THE GLOBAL GROWTH FUND, GLOBAL SMALL CAPITALIZATION
FUND, GROWTH FUND, INTERNATIONAL FUND, NEW WORLD FUND, GROWTH-INCOME FUND,
ASSET ALLOCATION FUND, BOND FUND AND HIGH-YIELD BOND FUND
The Global Growth Fund, Global Small Capitalization Fund, Growth Fund,
International Fund, Growth-Income Fund, Asset Allocation Fund, Bond Fund and
High-Yield Bond Fund may not:
1. Invest more than 5% of the value of the total assets of the fund in the
securities of any one issuer, provided that this limitation shall apply only to
75% of the value of the fund's total assets and, provided further, that the
limitation shall not apply to obligations of the government of the U.S. under a
general Act of Congress. The short-term obligations of commercial banks are
excluded from this 5% limitation with respect to 25% of the fund's total
assets.
2. As to 75% of its total assets, purchase more than 10% of the outstanding
voting securities of an issuer.
3. Invest more than 25% of the fund's total assets in the securities of issuers
in the same industry. Obligations of the U.S. Government, its agencies and
instrumentalities, are not subject to this 25% limitation on industry
concentration. In addition, the fund may, if deemed advisable, invest more
than 25% of its assets in the obligations of domestic commercial banks.
4. Invest in real estate (including limited partnership interests, but
excluding securities of companies, such as real estate investment trusts, which
deal in real estate or interests therein).
5. Purchase commodities or commodity contracts; except that the Global Small
Capitalization Fund, International Fund, Asset Allocation Fund, High-Yield Bond
Fund and Bond Fund may engage in transactions involving currencies (including
forward or futures contracts and put and call options).
6. Invest in companies for the purpose of exercising control or management.
7. Make loans to others except for (a) the purchase of debt securities; (b)
entering into repurchase agreements; (c) the loaning of its portfolio
securities; and (d) entering into loan participations.
8. Borrow money, except from banks for temporary purposes, and then in an
amount not in excess of 5% of the value of the fund's total assets. Moreover,
in the event that the asset coverage for such borrowings falls below 300%, the
fund will reduce, within three days, the amount of its borrowings in order to
provide for 300% asset coverage.
9. Purchase securities on margin.
10. Sell securities short, except to the extent that the fund
contemporaneously owns, or has the right to acquire at no additional cost,
securities identical to those sold short.
11. Invest in puts, calls, straddles, spreads or any combination thereof;
except as described above in Investment Restriction number 6.
12. Invest in securities of other investment companies, except as
permitted by the 1940 Act.
13. Engage in underwriting of securities issued by others, except to the
extent it may be deemed to be acting as an underwriter in the purchase or
resale of portfolio securities.
Notwithstanding investment restriction number 12, the funds may invest in
securities of other managed investment companies if deemed advisable by its
officers in connection with the administration of a deferred compensation plan
adopted by Trustees pursuant to an exemptive order granted by the Securities
and Exchange Commission.
Notwithstanding investment restriction number 13, the funds may not engage in
the business of underwriting securities of other issuers, except to the extent
that the disposal of an investment position may technically constitute the fund
an underwriter as that term is defined under the Securities Act of 1933.
The funds may not invest more than 15% of their net assets in illiquid
securities.
INVESTMENT RESTRICTIONS OF THE U.S. GOVERNMENT/AAA-RATED SECURITIES FUND
The U.S. Government/AAA-Rated Securities Fund may not:
1. Purchase any security (other than securities issued or guaranteed by the
U.S. Government or its agencies or instrumentalities ("U.S. Government
securities")) if, immediately after and as a result of such investment, more
than 5% of the value of the fund's total assets would be invested in securities
of the issuer.
2. Invest 25% or more of the value of its total assets in the securities of
issuers conducting their principal business activities in the same industry,
except that this limitation shall not apply to U.S. Government securities or
other securities to the extent they are backed by or represent interests in
U.S. Government securities or U.S. Government-guaranteed mortgages.
3. Invest in companies for the purpose of exercising control or management.
4. Invest in securities of other investment companies, except as permitted
by the 1940 Act.
5. Buy or sell real estate or commodities or commodity contracts in the
ordinary course of its business; however, the fund may purchase or sell readily
marketable debt securities secured by real estate or interests therein or
issued by companies which invest in real estate or interests therein, including
real estate investment trusts.
6. Engage in the business of underwriting securities of other issuers, except
to the extent that the disposal of an investment position may technically cause
it to be considered an underwriter as that term is defined under the Securities
Act of 1933.
7. Make loans, except that the fund may: (a) purchase readily marketable debt
securities; (b) invest in repurchase agreements; (c) make loans of portfolio
securities; and (d) enter into loan participations. The fund will not invest
in repurchase agreements maturing in more than seven days if any such
investment, together with any illiquid securities (including securities which
are subject to legal or contractual restrictions on resale) held by the fund,
exceeds 10% of the value of its total assets.
8. Sell securities short, except to the extent that the fund contemporaneously
owns or has the right to acquire at no additional cost, securities identical to
those sold short.
9. Purchase securities on margin, except that the fund may obtain such
short-term credits as may be necessary for the clearance of purchases and sales
of securities.
10. Borrow money, except from banks for temporary or emergency purposes not in
excess of 5% of the value of the fund's total assets, except that the fund may
enter into reverse repurchase agreements.
11. Write, purchase or sell puts, calls or combinations thereof.
Notwithstanding investment restriction number 4, the fund may invest in
securities of other managed investment companies if deemed advisable by its
officers in connection with the administration of a deferred compensation plan
adopted by Trustees pursuant to an exemptive order granted by the Securities
and Exchange Commission.
The fund may not invest more than 15% of its net assets in illiquid
securities.
INVESTMENT RESTRICTIONS OF THE CASH MANAGEMENT FUND
The Cash Management Fund may not:
1. Invest more than 5% of the value of the total assets of the fund in the
securities of any one issuer, provided that this limitation shall apply only to
75% of the value of the fund's total assets and, provided further, that the
limitation shall not apply to obligations of the government of the U.S. under a
general Act of Congress. The short-term obligations of commercial banks are
excluded from this 5% limitation with respect to 25% of the fund's total
assets.
2. As to 75% of its total assets, purchase more than 10% of the outstanding
voting class of securities of an issuer.
3. Invest more than 25% of the fund's total assets in the securities of issuers
in the same industry. Obligations of the U.S. Government, its agencies and
instrumentalities, are not subject to this 25% limitation on industry
concentration. In addition, the fund may, if deemed advisable, invest more
than 25% of its assets in the obligations of domestic commercial banks.
4. Enter into any repurchase agreement maturing in more than seven days or
invest in any other illiquid security if, as a result, more than 10% of the
fund's total assets would be so invested.
5. Make loans to others except for the purchase of the debt securities listed
above. The fund may enter into repurchase agreements as described above.
6. Borrow money, except from banks for temporary purposes, and then in an
amount not in excess of 5% of the value of the fund's total assets. Moreover,
in the event that the asset coverage for such borrowings falls below 300%, the
fund will reduce, within three days, the amount of its borrowings in order to
provide for 300% asset coverage.
7. Sell securities short except to the extent that the fund contemporaneously
owns or has the right to acquire at no additional cost, securities identical to
those sold short.
8. Invest in puts, calls, straddles, spreads or any combination thereof.
9. Purchase or sell securities of other investment companies (except in
connection with a merger, consolidation, acquisition or reorganization), real
estate or commodities.
10. Act as underwriter of securities issued by others, engage in distribution
of securities for others, or make investments in other companies for the
purpose of exercising control or management.
Notwithstanding investment restriction number 9, the fund may invest in
securities of other managed investment companies if deemed advisable by its
officers in connection with the administration of a deferred compensation plan
adopted by Trustees pursuant to an exemptive order granted by the Securities
and Exchange Commission.
Notwithstanding investment restriction number 1 above, in order to comply with
Rule 2a-7 under the 1940 Act, the Cash Management Fund has adopted a
non-fundamental policy (that may be changed by the Board of Trustees without
shareholder approval) of investing no more than 5% of its assets (measured at
the time of purchase) in the securities of any one issuer (other than the U.S.
Government); provided however, that the Cash Management Fund may invest, as to
25% of its assets, more than 5% of its assets in certain high-quality
securities (as defined in the Rule) of a single issuer for a period of up to
three business days. Investment restriction number 9 above does not prevent
the purchase by the Cash Management Fund of securities that have "put" or
"stand-by" commitment features.
SERIES ORGANIZATION AND VOTING RIGHTS
The Series, an open-end investment company, was organized as a Massachusetts
business trust on September 13, 1983.
All Series operations are supervised by the Board of Trustees which meets
periodically and performs duties applicable to state and federal law. Members
of the board who are not employed by Capital Research and Management Company or
its affiliates are paid certain fees for services rendered to the Series as
described in "Trustees and Trustee Compensation" below. They may elect to defer
all or a portion of these fees through a deferred compensation plan in effect
for the Series. The Board of Trustees has approved the retention of the
companies listed below to provide certain services to the Series.
SERIES TRUSTEES AND OFFICERS
TRUSTEES AND TRUSTEE COMPENSATION
<TABLE>
<CAPTION>
NAME, ADDRESS POSITION PRINCIPAL AGGREGATE TOTAL TOTAL
AND AGE WITH OCCUPATION(S) COMPENSATION COMPENSATION NUMBER OF
REGISTRANT DURING PAST 5 YEARS (INCLUDING (INCLUDING FUND
VOLUNTARILY VOLUNTARILY BOARDS
DEFERRED DEFERRED ON WHICH
COMPENSATION COMPENSATION TRUSTEE
/1/) FROM /1/) FROM ALL SERVES /2/
SERIES DURING FUNDS
FISCAL MANAGED BY
YEAR ENDED CAPITAL
11/30/99 AND ONE RESEARCH AND
MONTH ENDED MANAGEMENT
12/31/99 COMPANY OR ITS
AFFILIATES /2/
FOR THE YEAR
ENDED 11/30/99
AND ONE MONTH
ENDED 12/31/99
<S> <C> <C> <C> <C> <C>
Lee A. Ault III Trustee Chairman, In-Q-Tel, $11,667 $11,667 1
1901 Avenue of the Inc.; $13,500 $13,500
Stars former Chief
Suite 1800 Executive Officer,
Los Angeles, CA Telecredit, Inc.
90067
Age: 64
H. Frederick Trustee Private Investor; $33,500/3/ $204,200 18
Christie former President $13,500/3/ $33,150
P. O. Box 144 and Chief Executive
Palos Verdes, CA Officer, The
90274 Mission Group (non-utility holding
Age: 66 Company, subsidiary
of Southern
California Edison
Company)
Joe E. Davis Trustee Private Investor; $36,500 $36,500 1
3436 Caribeth Drive former Chairman, $13,500 $13,500
Encino, CA 91436 Linear Corporation;
Age: 64 former President and
Chief Executive
Officer, National
Health Enterprises,
Inc.
James K. Dunton President Senior Vice President None/4/ None/4/ 2
333 South Hope Street and and Director
Los Angeles, CA 90071 Trustee
Age: 62
Martin Fenton Trustee Chairman, Senior $34,500/3/ $124,700 16
4350 Executive Drive Resource Group $13,500/3/ $15,900
Suite 101 (management of senior
San Diego, CA 92123 living
Age: 63 centers)
Leonard R. Fuller Trustee President and Chief $11,667 $60,867 13
4337 Marina City Executive Officer, $13,500 $20,200
Drive Fuller Consulting
Suite 841 ETN (financial management
Marina del Rey, CA consulting)
90292
Age: 54
Mary Myers Kauppila Trustee Founder and $32,500/3/ $115,500 5
286 Congress Street President, Energy $13,500/3/ $23,250
Boston, MA 02110 Investment, Inc.
Age: 45
Donald D. O'Neal Executive Senior Vice President, None/4/ None/4/ 1
P.O. Box 7650 Vice Capital Research and
San Francisco, CA 94120 President and Management Company
Age: 40 Trustee
Kirk P. Pendleton Trustee President, Cairnwood, $30,500/3/ $135,000 7
Cairnwood, Inc. Inc. $13,500/3/ $19,500
Box 546
Bryn Athyn, PA 19009
Age: 60
+James F. Rothenberg Chairman of the Board President and none/4/ none/4/ 1
333 South Hope Director, Capital
Street Research and
Los Angeles, CA Management
90071 Company
Age: 53
</TABLE>
+ "INTERESTED PERSONS" WITHIN THE MEANING OF THE 1940 ACT ON THE BASIS OF
THEIR AFFILIATION WITH THE SERIES' INVESTMENT ADVISER, CAPITAL RESEARCH AND
MANAGEMENT COMPANY, OR THE PARENT COMPANY OF THE INVESTMENT ADVISER, THE
CAPITAL GROUP COMPANIES, INC.
/1/ AMOUNTS MAY BE DEFERRED BY ELIGIBLE TRUSTEES UNDER A NON-QUALIFIED DEFERRED
COMPENSATION PLAN ADOPTED BY THE SERIES IN 1993. DEFERRED AMOUNTS ACCUMULATE
AT AN EARNINGS RATE DETERMINED BY THE TOTAL RETURN OF ONE OR MORE FUNDS IN THE
AMERICAN FUNDS GROUP AS DESIGNATED BY THE TRUSTEE.
/2/ CAPITAL RESEARCH AND MANAGEMENT COMPANY MANAGES THE AMERICAN FUNDS GROUP
CONSISTING OF 28 FUNDS: AMCAP FUND, INC., AMERICAN BALANCED FUND, INC.,
AMERICAN HIGH-INCOME MUNICIPAL BOND FUND, INC., AMERICAN HIGH-INCOME TRUST,
AMERICAN MUTUAL FUND, INC., THE BOND FUND OF AMERICA, INC., THE CASH MANAGEMENT
TRUST OF AMERICA, CAPITAL INCOME BUILDER, INC., CAPITAL WORLD GROWTH AND INCOME
FUND, INC., CAPITAL WORLD BOND FUND, INC., EUROPACIFIC GROWTH FUND, FUNDAMENTAL
INVESTORS, INC., THE GROWTH FUND OF AMERICA, INC., THE INCOME FUND OF AMERICA,
INC., INTERMEDIATE BOND FUND OF AMERICA, THE INVESTMENT COMPANY OF AMERICA,
LIMITED TERM TAX-EXEMPT BOND FUND OF AMERICA, THE NEW ECONOMY FUND, NEW
PERSPECTIVE FUND, INC., SMALLCAP WORLD FUND, INC., THE TAX-EXEMPT BOND FUND OF
AMERICA, INC., THE TAX-EXEMPT FUND OF CALIFORNIA, THE TAX-EXEMPT FUND OF
MARYLAND, THE TAX-EXEMPT FUND OF VIRGINIA, THE TAX-EXEMPT MONEY FUND OF
AMERICA, THE U. S. TREASURY MONEY FUND OF AMERICA, U.S. GOVERNMENT SECURITIES
FUND AND WASHINGTON MUTUAL INVESTORS FUND, INC. CAPITAL RESEARCH AND
MANAGEMENT COMPANY ALSO MANAGES ANCHOR PATHWAY FUND WHICH SERVES AS THE
UNDERLYING INVESTMENT VEHICLE FOR CERTAIN VARIABLE INSURANCE CONTRACTS; AND
ENDOWMENTS, WHOSE SHAREHOLDERS ARE LIMITED TO (I) ANY ENTITY EXEMPT FROM
TAXATION UNDER SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED ("501 (C)(3) ORGANIZATION"); (II) ANY TRUST, THE PRESENT OR FUTURE
BENEFICIARY OF WHICH IS A 501(C)(3) ORGANIZATION; AND (III) ANY OTHER ENTITY
FORMED FOR THE PRIMARY PURPOSE OF BENEFITING A 501(C)(3) ORGANIZATION. AN
AFFILIATE OF CAPITAL RESEARCH AND MANAGEMENT COMPANY, CAPITAL INTERNATIONAL,
INC., MANAGES EMERGING MARKETS GROWTH FUND, INC.
/3/ SINCE THE DEFERRED COMPENSATION PLAN'S ADOPTION, THE TOTAL AMOUNT OF
DEFERRED COMPENSATION ACCRUED BY THE SERIES (PLUS EARNINGS THEREON) FOR
PARTICIPATING TRUSTEES IS AS FOLLOWS: H . FREDERICK CHRISTIE ($155,207); MARTIN
FENTON ($49,789); MARY MYERS KAUPPILA ($223,397) AND KIRK P. PENDLETON
($164,951). AMOUNTS DEFERRED AND ACCUMULATED EARNINGS THEREON ARE NOT FUNDED
AND ARE GENERAL UNSECURED LIABILITIES OF THE SERIES UNTIL PAID TO THE
TRUSTEE.
/4/ JAMES K. DUNTON, DONALD D. O'NEAL AND JAMES F. ROTHENBERG ARE
AFFILIATED WITH THE INVESTMENT ADVISER AND, ACCORDINGLY, RECEIVE NO
REMUNERATION FROM THE SERIES.
OFFICERS
<TABLE>
<CAPTION>
NAME AND ADDRESS AGE POSITION(S) PRINCIPAL
WITH OCCUPATION(S)
REGISTRANT DURING PAST 5 YEARS
<S> <C> <C> <C>
James F. Rothenberg 53 Chairman of President and
333 South Hope the Board Director, Capital
Street Research and
Los Angeles, CA Management Company
90071
James K. Dunton 62 President Senior Vice President
333 South Hope and and Director, Capital
Street Trustee Research and
Los Angeles, CA Management Company
90071
Donald D. O'Neal 40 Executive Vice Senior Vice President,
P.O. Box 7650 President Capital Research and
San Francisco, CA and Trustee Management Company
94120
Abner D. Goldstine 70 Senior Vice Senior Vice President
11100 Santa Monica President and Director, Capital
Boulevard Research and
Los Angeles, CA Management Company
90025
Michael J. Downer 45 Senior Vice Senior Vice President
333 South Hope President - Fund Business
Street Management Group,
Los Angeles, CA Capital Research and
90071 Management Company
Alan N. Berro 40 Vice Senior Vice President,
333 South Hope President Capital Research
Street Company*
Los Angeles, CA
90071
Claudia P. 48 Vice Senior Vice President,
Huntington President Capital Research
333 South Hope Company
Street
Los Angeles, CA
90071
Robert W. Lovelace 38 Vice Vice President,
11100 Santa Monica President Capital Research and
Boulevard Management Company
Los Angeles, CA
90025
John H. Smet 43 Vice Vice President,
11100 Santa Monica President Capital Research and
Boulevard Management Company
Los Angeles, CA
90025
Susan M. Tolson 36 Vice Senior Vice President
11100 Santa Monica President and Director, Capital
Boulevard Research Company
Los Angeles, CA
90025
Chad L. Norton 40 Secretary Vice President - Fund
333 South Hope Business Management
Street Group, Capital
Los Angeles, CA Research and
90071 Management Company
Robert P. Simmer 39 Treasurer Vice President - Fund
5300 Robin Hood Road Business Management
Norfolk, VA 23513 Group, Capital
Research and
Management Company
Sheryl F. Johnson 31 Assistant Assistant Vice
5300 Robin Hood Road Treasurer President - Fund
Norfolk, VA 23513 Business Management
Group, Capital
Research and
Management Company
David A. Pritchett 33 Assistant Assistant Vice
5300 Robin Hood Road Treasurer President - Fund
Norfolk, VA 23513 Business Management
Group, Capital
Research and
Management Company
</TABLE>
All of the officers listed are officers and/or directors/trustees of one or
more of the other funds served by the Investment Adviser.
No compensation is paid by the Series to any officer or Trustee who is a
director, officer or employee of the Investment Adviser or affiliated
companies. The Series pays fees of $22,000 per annum to Trustees who are not
affiliated with the Investment Adviser, plus $2,500 for each Board of Trustees
meeting attended, plus $1,000 for each meeting attended as a member of a
committee of the Board of Trustees. The Trustees may elect, on a voluntary
basis, to defer all or a portion of these fees through a deferred compensation
plan in effect for the Series. The Series also reimburses certain expenses of
the Trustees who are not affiliated with the Investment Adviser.
MANAGEMENT
INVESTMENT ADVISER -- The Investment Adviser, founded in 1931, maintains
research facilities in the U.S. and abroad (Los Angeles, San Francisco, New
York, Washington D.C., London, Geneva, Hong Kong, Singapore and Tokyo), with a
staff of professionals, many of whom have a number of years of investment
experience. The Investment Adviser is located at 333 South Hope Street, Los
Angeles, CA 90071, and at 135 South State College Boulevard, Brea, CA 92821.
The Investment Adviser's professionals travel several million miles a year,
making more than 5,000 research visits in more than 50 countries around the
world. The Investment Adviser believes that it is able to attract and retain
quality personnel. The Investment Adviser is a wholly owned subsidiary of The
Capital Group Companies, Inc.
The Investment Adviser is responsible for more than $300 billion of stocks,
bonds and money market instruments and serves over 11 million shareholder
accounts of all types around the world. These investors include privately
owned businesses and large corporations as well as schools, colleges,
foundations and other non-profit and tax-exempt organizations.
INVESTMENT ADVISORY AND SERVICE AGREEMENT - An Amended Investment Advisory and
Service Agreement (the "Agreement") between the Series and the Investment
Adviser, unless sooner terminated, will continue in effect until November 30,
2000, and may be renewed from year to year thereafter, provided that any such
renewal has been specifically approved at least annually by (I) the Board of
Trustees, or by the vote of a majority (as defined in the 1940 Act) of the
outstanding voting securities of the Series, and (ii) the vote of a majority of
Trustees who are not parties to the Agreement or interested persons (as defined
in the 1940 Act) of any such party, cast in person at a meeting called for the
purpose of voting on such approval. The Agreement provides that the Investment
Adviser has no liability to the Series for its acts or omissions in the
performance of its obligations to the Series not involving willful misconduct,
bad faith, gross negligence or reckless disregard of its obligations under the
Agreement. The Agreement also provides that either party has the right to
terminate it, without penalty, upon 60 days' written notice to the other party,
and that the Agreement automatically terminates in the event of its assignment
(as defined in the 1940 Act).
As compensation for its services, the Investment Adviser receives a monthly fee
which is accrued daily, calculated at the annual rates of:
GLOBAL GROWTH FUND: 0.69% of the first $600 million of net assets, plus 0.59%
on net assets greater than $600 million but not exceeding $1.2 billion, plus
0.53% on net assets in excess of $1.2 billion;
GLOBAL SMALL CAPITALIZATION FUND: .80% of the first $600 million of net
assets, plus 0.74% on net assets in excess of $600 million;
GROWTH FUND: 0.50% of the first $600 million of net assets, plus 0.45% on net
assets greater than $600 million but not exceeding $1.2 billion, plus 0.42% on
net assets greater than $1.2 billion but not exceeding $2.0 billion, plus 0.37%
on net assets greater than $2.0 billion but not exceeding $3.0 billion, plus
0.35% on net assets greater than $3.0 billion but not exceeding $5.0 billion,
plus 0.33% on net assets greater than $5.0 billion but not exceeding $8.0
billion, plus 0.315% on net assets greater than $8.0 billion but not
exceeding $13.0 billion, plus 0.30% on nets assets in excess of $13.0 billion;
INTERNATIONAL FUND: 0.69% of the first $500 million of net assets, plus 0.59%
on net assets greater than $500 million but not exceeding $1.0 billion, plus
0.53% on net assets greater than $1.0 billion but not exceeding $1.5 billion,
plus 0.50% on net assets greater than $1.5 billion but not exceeding $2.5
billion, plus 0.48% on net assets greater than $2.5 billion but not exceeding
$4.0 billion, plus 0.47% on net assets greater than $4.0 billion but not
exceeding $6.5 billion, plus 0.46% on net assets greater than $6.5 billion
but not exceeding $10.5 billion, plus 0.45% on net assets in excess of
$10.5 billion;
NEW WORLD FUND: 0.85% of net assets;
GROWTH-INCOME FUND: 0.50% of the first $600 million of net assets, plus 0.45%
on net assets greater than $600 million but not exceeding $1.5 billion, plus
0.40% on net assets greater than $1.5 billion but not exceeding $2.5 billion,
plus 0.32% on net assets greater than $2.5 billion but not exceeding $4.0
billion, plus 0.285% on net assets greater than $4.0 billion but not exceeding
$6.5 billion, plus 0.256% on net assets greater than $6.5 billion but not
exceeding $10.5 billion, plus 0.242% on net assets in excess of $10.5 billion;
ASSET ALLOCATION FUND: 0.50% of the first $600 million of net assets, plus
0.42% on net assets greater than $600 million but not exceeding $1.2 billion,
plus 0.36% on net assets greater than $1.2 billion but not exceeding $2.0
billion, plus 0.32%on net assets in excess of $2.0 billion;
BOND FUND: 0.48% of the first $600 million of net assets, plus 0.44% on net
assets greater than $600 million but not exceeding $1.0 billion, plus 0.40%
on net assets in excess of $1.0 billion;
HIGH-YIELD BOND FUND: 0.50% of the first $600 million of net assets, plus 0.46%
on net assets greater than $600 million but not exceeding $1.0 billion, plus
0.46% on net assets in excess of $1.0 billion;
U.S. GOVERNMENT/AAA-RATED SECURITIES FUND: 0.46% of the first $600 million of
net assets, plus 0.40% on net assets greater than $600 million but not exceeding
$1.0 billion, plus 0.36% on net assets in excess of $1.0 billion;
CASH MANAGEMENT FUND: 0.50% of the first $100 million of net assets, plus
0.42% on net assets greater than $100 million but not exceeding $400 million,
plus 0.38% on net assets in excess of $400 million.
The Investment Adviser, in addition to providing investment advisory services,
furnishes the services and pays the compensation and travel expenses of
qualified persons to perform the executive, and related administrative
functions of the Series, provides necessary office space, office equipment and
utilities, and general purpose accounting forms, supplies, and postage used at
the office of the Series relating to the services furnished by the Investment
Adviser. Subject to the expense agreement described below, the Series will pay
all expenses not expressly assumed by the Investment Adviser, including, but
not limited to, registration and filing fees with federal and state agencies;
blue sky expenses (if any); expenses of shareholders' meetings; the expense of
reports to existing shareholders; expenses of printing proxies and
prospectuses; insurance premiums; legal and auditing fees; dividend
disbursement expenses; the expense of the issuance, transfer, and redemption of
its shares; custodian fees; printing and preparation of registration
statements; taxes; compensation, fees and expenses paid to Trustees
unaffiliated with the Investment Adviser; association dues; and costs of
stationary and forms prepared exclusively for the Series.
The Agreement provides for an advisory fee reduction to the extent that each
fund's annual ordinary net operating expenses, except the International Fund's,
exceed 1 1/2% of the first $30 million of the average month-end total net
assets of the fund and 1% of the average month-end total net assets in excess
thereof. For the International Fund, the advisory fee will be reduced to the
extent that its annual ordinary net operating expenses exceed 1 1/2% of its
average month-end total net assets. Expenditures, including costs incurred in
connection with the purchase or sale of portfolio
securities, which are capitalized in accordance with generally accepted
accounting principles applicable to investment companies, are accounted for as
capital items and not as expenses.
During the fiscal years ended November 30, 1999, 1998 and 1997, the Investment
Adviser's total fees, respectively, amounted to the following: Global Growth
Fund $2,672,000, $1,341,000 and $310,000; Growth Fund $26,451,000, $20,494,000
and $17,154,000; International Fund $17,107,000, $15,732,000 and $15,477,000;
Growth-Income Fund $26,220,000, $24,542,000 and $21,263,000; Asset Allocation
Fund $7,418,000, $6,916,000 and $5,806,000; Bond Fund $1,228,000, $952,000 and
$557,000; High-Yield Bond Fund $3,651,000, $4,018,000 and $3,624,000;
U.S.Government/AAA-Rated Securities Fund $2,681,000, $2,553,000 and
$2,444,000; and Cash Management Fund $1,441,000, $1,164,000 and $1,113,000.
During the fiscal periods ended November 30, 1999 and 1998, the Investment
Adviser's total fee for the Global Small Capitalization Fund amounted to
$1,054,000 and $240,000. During the fiscal period ended November 30, 1999, the
total fee for the New World Fee amounted to $154,000.
During the one-month period ended December 31, 1999, the Investment Adviser's
total fee amounted to the following: Global Growth Fund $376,000; Global Small
Capitalization Fund $176,000; Growth Fund $2,723,000; International Fund
$1,874,000; New World Fund $54,000; Growth-Income Fund $2,192,000; Asset
Allocation Fund $623,000; Bond Fund $111,000; High-Yield Bond Fund $291,000;
U.S. Government/AAA-Rated Securities Fund $204,000; and Cash Management Fund
$134,000.
PLAN OF DISTRIBUTION The Series has adopted a Plan of Distribution (the
"Plan") for its Class 2 shares, pursuant to rule 12b-1 under the 1940 Act. As
required by rule 12b-1, the Plan has been approved by a majority of the entire
Board of Trustees, and separately by a majority of the Trustees who are not
"interested persons" of the Series and who have no direct or indirect financial
interest in the operation of the Plan. The officers and Trustees who are
"interested persons" of the Series may be considered to have a direct or
indirect financial interest in the operation of the Plan due to present or past
affiliations with the Investment Adviser and related companies. Potential
benefits of the Plan to the Series include improved shareholder services,
benefits to the investment process from growth or stability of assets and
maintenance of a financially healthy management organization. The selection
and nomination of Trustees who are not "interested persons" of the Series is
committed to the discretion of the Trustees who are not "interested persons"
during the existence of the Plan. The Plan is reviewed quarterly and must be
renewed annually by the Board of Trustees.
Under the Plan the Series will pay to insurance company contract issuers 0.25%
of each fund's average net assets annually (Class 2 shares only) to finance any
distribution activity which is primarily intended to benefit the Class 2 shares
of the Series, provided that the Board of Trustees of the Series has approved
the categories of expenses for which payment is being made. Payments made
pursuant to the Plan will be used by insurance company contract issuers to pay
a continuing annual service fee to dealers on the value of all variable annuity
contract payments. During the fiscal year ended November 30, 1999 and the
one-month period ended December 31, 1999, the Series paid $5,710,000 and
$765,000, respectively to certain life insurance companies under the Plan.
This fee is paid to the contract issuers without regard to expenses. Accrued
and unpaid distribution expenses were $671,000 and $765,000, respectively.
PRICE OF SHARES
The price paid for shares is based on the net asset value per share which is
calculated once daily as of approximately 4:00 p.m., New York time, which is
the normal close of trading on the New York Stock Exchange each day the
Exchange is open. If, for example, the Exchange closes at 1:00 p.m., the
funds' share prices would still be determined as of 4:00 p.m. New York time.
The New York Stock Exchange is currently closed on weekends and on the
following holidays: New Year's Day, Martin Luther King, Jr. Day, Presidents'
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and
Christmas Day. Certain of the funds invest in securities listed on foreign
exchanges which trade on Saturdays or other U.S. business holidays. Since the
funds typically do not calculate their net asset values on Saturdays or other
U.S. business holidays, the value of the funds' redeemable securities may be
affected on days when shareholders do not have access to the funds. The net
asset value per share is determined as follows:
1. Equity securities, including depositary receipts, are valued at the last
reported sale price on the exchange or market on which such securities are
traded, as of the close of business on the day the securities are being valued
or, lacking any sales, at the last available bid price. In cases where equity
securities are traded on more than one exchange, the securities are valued on
the exchange or market determined by the Investment Adviser to be the broadest
and most representative market, which may be either a securities exchange or
the over-the-counter market. Fixed-income securities are valued at prices
obtained from a pricing service, when such prices are available; however, in
circumstances where the Investment Adviser deems it appropriate to do so, such
securities will be valued at the mean quoted bid and asked prices or at prices
for securities of comparable maturity, quality and type. Securities with
original maturities of one year or less having 60 days or less to maturity are
amortized to maturity based on their cost if acquired within 60 days of
maturity or, if already held on the 60th day, based on the value determined on
the 61st day. Forward currency contracts are valued at the mean of
representative quoted bid and asked prices.
Assets or liabilities initially expressed in terms of foreign currencies are
translated prior to the next determination of the net asset value of the fund's
shares into U.S. dollars at the prevailing market rates.
Securities and assets for which representative market quotations are not
readily available are valued at fair value as determined in good faith under
policies approved by the fund's Board. The fair value of all other assets is
added to the value of securities to arrive at the total assets;
2. Liabilities, including accruals of taxes and other expense items, are
deducted from total assets; and
3. Net assets so obtained are then divided by the total number of shares
outstanding, and the result, rounded to the nearer cent, is the net asset value
per share.
DIVIDENDS, DISTRIBUTIONS AND FEDERAL TAXES
Each fund of the Series intends to qualify to be taxed as a "regulated
investment company" under the provisions of Subchapter M of the Internal
Revenue Code of 1986, as amended (the "Code"). To qualify for the tax
treatment afforded a regulated investment company under the Code, a fund must
annually distribute at least 90% of its net investment income and certain
short-term capital gains and meet certain diversification of assets and other
requirements of the Code. If a fund qualifies for such tax treatment, it will
not be subject to Federal income tax on the part of its ordinary income and its
net realized capital gains which it distributes to shareholders. To meet the
requirements of the Code, a fund must (a) derive at least 90% of its gross
income from dividends, interest, payments with respect to securities loans, and
gains from the sale or other disposition of stock or securities or currencies;
and (b) diversify its holdings so that, at the end of each fiscal quarter, (i)
at least 50% of the market value of the fund's assets is represented by cash,
U.S. Government securities, securities of other regulated investment companies,
and other securities, limited, in respect of any one issuer, to an amount not
greater than 5% of the fund's assets and 10% of the outstanding voting
securities of such issuer, and (ii) not more than 25% of the value of its
assets is invested in the securities of any one issuer (other than U.S.
Government securities or the securities of other regulated investment
companies), or in two or more issuers which each fund controls and which are
engaged in the same or similar trades or businesses. It is the Series' policy
to distribute to the shareholders (the insurance company separate accounts) all
of its net investment income and net realized capital gains during each fiscal
year.
Under the Code, a fund may elect to compute taxable income for each year
without regard to any net foreign currency loss attributable to transactions
after October 31, and any such net foreign currency loss will be treated as
arising on the first day of the following taxable year.
The amount of any realized gain or loss by a fund on closing out a currency
contract will generally result in ordinary income or loss for tax purposes.
Under Code Section 1256, currency contracts held by each fund at the end of
each fiscal year will be required to be "marked to market" for federal income
tax purposes, that is, deemed to have been sold at market value. Sixty percent
of any net gain or loss recognized on these deemed sales and 60% of any net
realized gain or loss from any actual sales, will be treated as long-term
capital gain or loss, and the remainder of gain or loss from deemed and actual
sales will be treated as short-term capital gain or loss. Code Section 988
may also apply to currency contracts. Under Section 988, each foreign currency
gain or loss is generally computed separately and treated as ordinary income or
loss. In the case of overlap between Sections 1256 and 988, special provisions
determine the character and timing of any income, gain or loss. Each fund will
attempt to monitor Section 988 transactions to avoid an adverse tax impact.
Each fund, except for the Cash Management Fund, may be required to pay
withholding and other taxes imposed by foreign countries which would reduce
investment income. Tax conventions between certain countries and the United
States may reduce or eliminate such taxes.
In addition to the asset diversification and other requirements for
qualification as a regulated investment company, the funds are subject to
another set of asset diversification requirements applicable to insurance
company separate accounts and their underlying funding vehicles. To satisfy
these diversification requirements, as of the end of each calendar quarter or
within 30 days thereafter, no more than 55% of the total assets of a fund may
be represented by any one investment, no more than 70% by any two investments,
no more than 80% by any three investments, and no more than 90% by any four
investments. For this purpose all securities of the same issuer are considered
a single investment, and each agency or instrumentality of the U.S. government
is treated as a separate issuer of securities. The Series intends to comply
with these regulations. If a fund should fail to comply with these
regulations, Contracts invested in that fund will not be treated as annuity,
endowment or life insurance contracts under the Code.
See the applicable Contract prospectus for information regarding the Federal
income tax treatment of the Contracts and distributions to the separate
accounts.
EXECUTION OF PORTFOLIO TRANSACTIONS
The Investment Adviser places orders for the fund's portfolio securities
transactions. The Investment Adviser strives to obtain the best available
prices in its portfolio transactions taking into account the costs and quality
of executions. When, in the opinion of the Investment Adviser, two or more
brokers
(either directly or through their correspondent clearing agents) are in a
position to obtain the best price and execution, preference may be given to
brokers who have sold shares of the fund or who have provided investment
research, statistical, or other related services to the Investment Adviser. The
fund does not consider that it has an obligation to obtain the lowest available
commission rate to the exclusion of price, service and qualitative
considerations.
There are occasions on which portfolio transactions for the fund may be
executed as part of concurrent authorizations to purchase or sell the same
security for other funds served by the Investment Adviser, or for trusts or
other accounts served by affiliated companies of the Investment Adviser.
Although such concurrent authorizations potentially could be either
advantageous or disadvantageous to the fund, they are effected only when the
Investment Adviser believes that to do so is in the interest of the fund. When
such concurrent authorizations occur, the objective is to allocate the
executions in an equitable manner. The fund will not pay a mark-up for research
in principal transactions.
Brokerage commissions paid on portfolio transactions for the fiscal years ended
November 30, 1999, 1998 and 1997, respectively, amounted to the following:
Global Growth Fund $414,000, $292,000 and $194,000; Growth Fund $4,487,000,
$3,271,000, and $2,869,000; International Fund $5,345,000, $3,972,000, and
$5,252,000; Growth-Income Fund $6,110,000, $5,110,000, and $3,955,000; and
Asset Allocation Fund $790,000, $501,000, and $551,000. Brokerage commissions
paid on portfolio transactions for the Global Small Capitalization Fund for the
periods ended November 30, 1999 and 1998 amounted to $385,000 and $90,000.
Commissions paid on transactions for the New World Fund for the period ended
November 30, 1999 amounted to $106,000.
Brokerage commissions paid on portfolio transactions for the one-month period
ended December 31, 1999 amounted to the following: Global Growth Fund $40,000;
Global Small Capitalization Fund $89,000; Growth Fund $433,000, International
Fund $336,000; New World Fund $16,000; Growth-Income Fund $520,000; and Asset
Allocation Fund $53,000.
GENERAL INFORMATION
CUSTODIANS OF ASSETS -- Securities and cash owned by all funds except New World
Fund, including proceeds from the sale of shares of the funds and of securities
in the funds' portfolios, are held by State Street Bank and Trust Company, 225
Franklin Street, Boston, Massachusetts 02110, as Custodian. Securities and cash
owned by New World Fund, including proceeds from the sale of shares of the fund
and of securities in the fund's portfolio, are held by The Chase Manhattan
Bank, One Chase Manhattan Plaza, New York, NY 10081, as Custodian. Non-U.S.
securities may be held by the Custodians in non-U.S. banks or securities
depositories or foreign branches of U.S. banks.
INDEPENDENT ACCOUNTANTS -- PricewaterhouseCoopers LLP, 400 South Hope Street,
Los Angeles, CA 90071, has served as the Series' independent accountants since
March 18, 1991, providing audit services, preparation of tax returns and review
of certain documents to be filed with the Securities and Exchange Commission.
The financial statements included in this Statement of Additional Information
from the Annual Report have been so included in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting. The selection of the Series'
independent accountant is reviewed and determined annually by the Board of
Trustees.
PROSPECTUSES AND REPORTS TO SHAREHOLDERS -- The Series' fiscal year ends
December 31. Contract owners are provided with updated prospectuses annually.
In addition, contract owners are provided at least semi-annually with reports
showing the investment portfolio, financial statements and other information.
The Series' annual financial statements are audited by the independent
accounting firm of PricewaterhouseCoopers LLP.
PERSONAL INVESTING POLICY -- The Series, Capital Research and Management
Company and its affiliated companies have adopted codes of ethics which allow
for personal investments. The personal investing policy consistent with
Investment Company Institute guidelines. This policy includes: a ban on
acquisitions of securities pursuant to an initial public offering; restrictions
on acquisitions of private placement securities; pre-clearance and reporting
requirements; review of duplicate confirmation statements; annual
recertification of compliance with codes of ethics; blackout periods on
personal investing for certain investment personnel; a ban on short-term
trading profits for investment personnel; limitations on service as a director
of publicly traded companies; and disclosure of personal securities
transactions.
SHAREHOLDER AND TRUSTEE RESPONSIBILITY -- Under the laws of certain states,
including Massachusetts, where the Series was organized, and California, where
the Series' principal office is located, shareholders of a Massachusetts
business trust may, under certain circumstances, be held personally liable as
partners for the obligations of the Series. However, the risk of a shareholder
incurring any financial loss on account of shareholder liability is limited to
circumstances in which the Series itself would be unable to meet its
obligations. The Declaration of Trust contains an express disclaimer of
shareholder liability for acts or obligations of the Series and provides that
notice of the disclaimer may be given in each agreement, obligation, or
instrument which is entered into or executed by the Series or Trustees. The
Declaration of Trust provides for indemnification out of Series property of any
shareholder personally liable for the obligations of the Series and also
provides for the Series to reimburse such shareholder for all legal and other
expenses reasonably incurred in connection with any such claim or liability.
Under the Declaration of Trust, the Trustees or officers are not liable for
actions or failure to act; however, they are not protected from liability by
reason of their willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of their office. The Series
will provide indemnification to its Trustees and officers as authorized by its
By-Laws and by the 1940 Act and the rules and regulations thereunder.
REGISTRATION STATEMENT -- A registration statement has been filed with the
Securities and Exchange Commission under the Securities Act of 1933 and the
1940 Act, with respect to the Series. The prospectus and this Statement of
Additional Information do not contain all information set forth in the
registration statement, its amendments and exhibits, to which reference is made
for further information concerning the Series. Statements contained in the
prospectus and this Statement of Additional Information as to the content of
the Contracts issued through the separate accounts and other legal instruments
are summaries. For a complete statement of the terms thereof, reference is
made to the registration statements of the separate accounts and Contracts as
filed with the Securities and Exchange Commission.
AUTHORIZED SHARES -- The Series was organized as a Massachusetts Business Trust
which permits each fund of the Series to issue an unlimited number of shares of
beneficial interest of one or more classes.
DESCRIPTION OF COMMERCIAL PAPER RATINGS
Moody's Investors Service, Inc.'s top two rating designations for commercial
paper are described as follows: issues rated Prime-1 have a superior capacity
for repayment of short-term promissory obligations. Prime-1 repayment capacity
will normally be evidenced by the following characteristics: leading market
positions in well-established industries; high rates of return on funds
employed; conservative capitalization structures with moderate reliance on debt
and ample asset protection; broad margins in earnings coverage of fixed
financial charges and high internal cash generation; and well-established
access to a range of financial markets and assured sources of alternate
liquidity. Issues rated Prime-2 have a strong capacity for repayment of
short-term promissory obligations. This will normally be evidenced by many of
the characteristics cited above, but to a lesser degree. Earnings trends and
coverage ratios, while sound, will be more subject to variation.
Capitalization characteristics, while still appropriate, may be more affected
by external conditions. Ample alternate liquidity is maintained.
Standard & Poor's Corporation's top two rating categories for commercial paper
are described as follows: A -- Issues assigned its highest rating are regarded
as having the greatest capacity for timely payment. Issues in this category
are delineated with numbers 1 or 2 to indicate the relative degree of safety.
A-1 -- This designation indicates that the degree of safety regarding timely
payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics will be denoted with a plus (+)
sign designation. A-2 -- Capacity for timely payments on issues with this
designation is strong. However, the relative degree of safety is not as high
as for issues designated "A-1".
<TABLE>
American Variable Insurance Series Global Growth Fund
Investment Portfolio
<S> <C> <C> <C> <C>
Where the funds are invested Dec. 31, 1999 Nov. 30, 1999
The Americas 35.06 36.17
Asia/Pacific 29.95 29.59
Europe 25.13 26.48
Other 0.80 0.90
Cash & Cash Equivalents 9.06 6.86
LARGEST INDIVIDUAL EQUITY SECURITIES
Dec. 31, 1999 Nov. 30, 1999
Percent of Percent of
Net Assets Net Assets
Murata Manufacturing 2.6 Fujitsu Support 2.67
Fujitsu Support and Services 2.5 and Services
Infosys Technologies 2.2 Murata Manufacturing 2.32
Chartered Semiconductor Manufacturing 2.1 AstraZeneca 2.01
Mannesman 1.9 Chartered Semiconductor 1.97
Oracle 1.7 Manufacturing
AstraZeneca 1.5 Infosys Technologies 1.75
Telefonaktiebolaget LM Ericsson 1.4 Telefonaktiebolaget 1.47
Microsoft 1.3 LM Ericsson
Fuji Television Network 1.3 Mannesmann 1.42
Microsoft 1.33
Oracle 1.33
United Pan-Europe 1.26
Communications
Dec. 31, 1999 Nov. 30, 1999
Number Market Value Number Market Value
of Shares of Shares
(000) (000)
Equity Securitites (common and preferred stocks)
--------------------------------------------
ELECTRONIC COMPONENTS - 11.23% / 11.21%
Murata Manufacturing Co., Ltd. (Japan) 82,00 $ 19,2 82,000 $ 13,659
Microchip Technology Inc. (USA) (1) 110,00 7,5 110,000 6,971
Rohm Co., Ltd. (Japan) 23,00 9,4 23,000 6,267
Samsung Electronics Co., Ltd. (South Korea) 26,22 6,1 26,227 5,431
Taiwan Semiconductor Manufacturing Co. Ltd. 1,400,00 7,4 1,150,000 5,404
(Taiwan) (1)
Texas Instruments Inc. (USA) 55,00 5,3 55,000 5,283
Samsung Electro-Mechanics Co. (South Korea) (1) 55,00 3,6 55,000 4,271
Intel Corp. (USA) 55,00 4,5 55,000 4,218
Keyence Corp. (Japan) 14,50 5,8 14,500 4,140
Venture Manufacturing (Singapore) Ltd (Singapore) 380,00 4,3 380,000 3,845
Cypress Semiconductor Corp. (USA) (1) 85,00 2,7 85,000 2,316
Applied Micro Circuits Corp. (USA) (1) 20,00 2,5 20,000 1,663
EPCOS AG (Germany) (1) 21,00 1,5 21,000 1,290
Quantum Corp. - DLT & Storage Systems 70,00 1,0 70,000 1,103
(formerly Quantum Corp.) (USA) (1)
BROADCASTING & PUBLISHING - 10.62% / 10.82%
United Pan-Europe Communications NV 75,60 9,6 75,600 7,423
(Netherlands) (1)
Grupo Televisa, SA, ordinary participation 118,00 8,0 151,000 7,371
certificates (ADR) (Mexico) (1)
Viacom Inc., Class B (USA) (1) 144,00 8,7 144,000 7,164
Fuji Television Network Inc. (Japan) (1) 72 9,9 724 6,735
Time Warner Inc. (USA) 80,00 5,7 80,000 4,935
News Corp. Ltd. (Australia) 511,52 4,9 511,522 4,432
Fox Entertainment Group, Inc., Class A (USA) (1) 160,00 3,9 160,000 3,680
Nippon Television Network Corp. (Japan) 3,50 4,1 3,500 3,346
Rogers Communications Inc., Class B (Canada) (1) 125,00 3,0 125,000 2,837
SBS Broadcasting SA (Luxembourg) (1) 60,00 2,9 60,000 2,430
Austar United Communications Ltd. (Australia) (1) 580,00 2,3 580,000 2,142
KirchMedia GmbH & Co. KGaA (Germany) (1) (2) (3) 42,00 1,8 42,000 1,854
ProSieben Media AG (Germany) 36,00 2,0 36,000 1,676
John Fairfax Holdings Ltd. (Australia) 515,00 1,5 515,000 1,462
Sogecable, SA (Spain) (1) 45,00 2,8 45,000 1,422
PRIMEDIA Inc. (USA) (1) 110,00 1,8 110,000 1,327
Washington Post Co., Class B (USA) 2,00 1,1 2,000 1,143
Ziff-Davis Inc. (USA) (1) 39,70 6 39,700 732
Sinclair Broadcast Group, Inc., Class A (USA) (1) 53,80 6 53,800 619
Insight Communications Co., LP, Class A (USA) (1) 20,00 5 20,000 495
CBS Corp. (USA) (1) 7,16 4 7,168 373
BUSINESS SERVICES - 10.83% / 10.69%
Fujisu Support & Service Inc. (Japan) 37,00 18,1 37,000 15,662
Hays PLC (United Kingdom) 360,00 5,7 360,000 5,488
Reuters Group PLC (United Kingdom) 426,14 5,9 426,140 4,787
Cendant Corp. (USA) (1) 281,00 7,4 281,000 4,654
Terra Networks, SA (Spain) (1) 91,10 4,9 91,100 3,138
Vivendi SA (France) 38,61 3,4 38,617 3,091
Rentokil Initial PLC (United Kingdom) 690,80 2,5 690,800 2,647
InterQ Inc. (Japan) (1) 6,00 3,4 3,000 2,422
Brambles Industries Ltd. (Australia) 86,60 2,3 86,600 2,379
Sabre Group Holdings, Inc., Class A (USA) (1) 50,00 2,5 50,000 2,275
eXchange Holding PLC (United Kingdom) (1) 539,00 3,0 539,000 2,101
NDS Group PLC, Class A (ADR) (USA) (1) 68,00 2,0 68,000 2,066
Yahoo! Inc. (USA) (1) 8,70 3,7 8,700 1,851
OpenTV, Class A (USA) (1) 23,00 1,8 23,000 1,777
China.com Corp., Class A (Hong Kong) (1) 31,40 2,4 15,700 1,758
Securitas AB, Class B (Sweden) 90,00 1,6 90,000 1,498
Freeserve PLC (United Kingdom) (1) 314,40 3,0 314,400 1,491
Adecco SA (Switzerland) (1) 2,00 1,5 2,000 1,278
Waste Management, Inc. (USA) 60,00 1,0 60,000 975
Ratin A/S, Class B (Denmark) 6,30 7 6,300 734
United Parcel Service, Inc. Class B (USA) 5,60 3 5,600 370
Securicor Group PLC (United Kingdom) 150,00 3 150,000 364
DIVERSIFIED TELECOMMUNICATION SERVICES
- 8.18% / 9.00%
Korea Telecom Corp. (ADR) (Korea) 110,00 8,2 130,400 6,911
Telecom Italia SpA, nonconvertible savings (Italy 1,034,00 6,2 1,034,000 5,572
Telecom Italia SpA 110,00 1,5 110,000 1,203
Deutsche Telekom AG (Germany) 111,47 7,9 111,479 6,382
Teleglobe Inc. (Canada) 221,00 5,0 221,000 5,480
Telefonica, SA (ADR) (Spain) (1) 85,76 6,7 85,763 5,328
AT&T Corp. (USA) 66,00 3,3 66,000 3,688
Nippon Telegraph and Telephone Corp. (Japan) 19 3,2 190 3,423
Global TeleSystems Group, Inc. (USA) (1) 100,00 3,4 100,000 3,194
Kingston Communications (HULL) PLC 220,00 2,6 220,000 2,451
(United Kingdom) (1)
Cable & Wireless Communications PLC 211,10 2,9 211,100 2,376
(United Kingdom) (1)
eireann PLC (Ireland) 437,50 1,8 437,500 1,740
Telefonos de Mexico, SA de CV, Class L 16,00 1,8 16,000 1,481
(ADR) (Mexico)
Telecom Argentina STET-France Telecom SA, 47,00 1,6 47,000 1,380
Class B (ADR) (Argentina)
Global Crossing Ltd. (USA - Incorporated 26,00 1,3 26,000 1,134
in Bermuda) (1)
Equant NV, New York registered (Netherlands) (1) 10,60 1,1 10,600 999
Compania de Telecomunicaciones de 6,03 1 6,030 111
Chile SA (ADR) (Chile)
HEALTH & PERSONAL CARE - 5.83% / 6.79%
AstraZeneca PLC (United Kingdom) 267,36 11,1 259,365 11,643
AstraZeneca PLC (ADR) 3,00 1 3,000 134
Pfizer Inc (USA) 212,45 6,8 147,450 5,336
Avon Products, Inc. (USA) 142,90 4,7 142,900 5,207
Fujisawa Pharmaceutical Co. Ltd. (Japan) 165,00 4,0 165,000 4,475
Forest Laboratories, Inc. (USA) (1) 44,00 2,7 44,000 2,252
QLT PhotoTherapeutics Inc. (Canada) (1) 50,00 2,9 50,000 2,231
Guidant Corp. (USA) (1) 66,00 3,1 36,000 1,800
Omnicare, Inc. (USA) 130,00 1,5 130,000 1,763
Luxottica Group SpA (ADR) (Italy) 100,00 1,7 100,000 1,750
Glaxo Wellcome PLC (United Kingdom) 52,90 1,5 52,900 1,613
Cardinal Health, Inc., (USA) 35,00 1,6 30,000 1,569
Genentech, Inc. (USA) (1) 1,60 2 1,600 138
WIRELESS TELECOMMUNICATION SERVICES
- 5.64% / 5.94%
Mannesmann AG (ADR) (Germany) 39,65 9,6 39,650 8,327
Mannesmann AG (formerly Orange PLC) 18,52 4,4 192,000 5,772
DDI Corp. (Japan) 48 6,5 480 6,663
China Telecom (Hong Kong) Ltd. (ADR) 31,00 3,9 31,000 3,259
(People's Republic of China) (1)
China Telecom (Hong Kong) Ltd. (1) 270,00 1,6 270,000 1,450
Tele Celular Sul Participacoes SA, preferred 106,50 3,3 106,500 2,130
nominative (ADR) (Brazil)
Telesystem International Wireless Inc. 80,00 2,9 80,000 1,932
(Canada) (1)
Tele Nordeste Celular Participacoes SA, 68,90 3,4 68,900 1,791
preferred nominative (ADR) (Brazil)
Vodafone AirTouch PLC (formerly Airtouch 25,00 1,2 25,000 1,180
Communications) (ADR) (United Kingdom)
Crown Castle International Corp. (USA) (1) 55,00 1,7 55,000 1,158
Stet Hellas Telecommunications SA (ADR) 35,30 1,0 35,300 697
(Greece) (1)
Partner Communications Co. Ltd (ADR) 29,00 7 29,000 544
(Israel) (1)
DATA PROCESSING & REPRODUCTION - 4.62% / 5.21%
Microsoft Corp. (USA) (1) 86,00 10,0 86,000 7,830
Oracle Corp. (USA) (1) 110,00 12,3 115,000 7,798
Documentum, Inc. (USA) (1) 35,00 2,0 139,900 4,704
Computer Associates International, Inc. (USA) 70,00 4,8 70,000 4,550
PeopleSoft, Inc. (USA) (1) 150,00 3,1 150,000 2,822
Rambus Inc. (USA) (1) 27,000 1,905
Storage Technology Corp. (USA) (1) 50,00 9 50,000 988
Momentum Business Applications, Inc., 5,00 5,000 41
Class A (USA) (1)
ELECTRICAL & ELECTRONICS - 5.04% / 4.75%
Chartered Semiconductor Manufacturing Ltd 217,50 15,8 217,500 11,582
(ADR) (Singapore) (1)
Telefonaktiebolaget LM Ericsson, Class B 157,50 10,1 177,500 8,611
(Sweden)
Nortel Networks Corp. (Canada) 66,80 6,7 66,800 4,943
Nokia Corp., Class A (ADR) (Finland) 20,00 3,8 20,000 2,764
BANKING - 2.72% / 3.28%
Bank of America Corp. (USA) 87,00 4,3 77,000 4,505
Bank of Nova Scotia (Canada) 161,00 3,4 161,000 3,474
Banque Nationale de Paris (France) 33,35 3,0 33,350 3,056
Banque Nationale de Paris, guaranteed value 14,95 14,950 64
certificates, expire 2002 (1)
Washington Mutual, Inc. (USA) 75,00 1,9 75,000 2,175
DBS Group Holdings Ltd. (formerly Development 151,19 2,4 151,190 1,962
Bank of Singapore Ltd.) (Singapore)
ABN AMRO Holding NV (Netherlands) 66,72 1,6 66,728 1,624
Westpac Banking Corp. (Australia) 215,66 1,4 215,666 1,453
Toronto-Dominion Bank (Canada) 39,20 1,0 39,200 944
Sakura Bank Ltd 20,00 116
METALS: NONFERROUS - 2.28% / 2.17%
Freeport-McMoRan Copper & Gold Inc., 335,00 7,0 335,000 5,297
Class B (USA) (1)
Alcoa Inc. (USA) 78,50 6,5 76,500 5,011
Billiton PLC (United Kingdom) 500,00 2,9 500,000 2,412
MERCHANDISING - 1.85% / 2.16%
Dixons Group PLC (United Kingdom) 120,00 2,8 120,000 2,555
Consolidated Stores Corp. (USA) (1) 113,70 1,8 113,700 1,791
Ito-Yokado Co., Ltd. (Japan) 16,00 1,7 16,000 1,733
Limited Inc. (USA) 40,00 1,7 40,000 1,698
Woolworths Ltd. (Australia) 420,38 1,4 420,385 1,421
Kingfisher PLC (United Kingdom) 140,86 1,5 140,866 1,311
Sunglass Hut International, Inc. (USA) (1) 89,00 1,0 89,000 1,090
Cifra, SA de CV (ADR) (Mexico) (1) 60,00 1,2 60,000 1,087
LEISURE & TOURISM - 2.10% / 2.04%
Seagram Co. Ltd. (Canada) 80,00 3,5 80,000 3,485
SFX Entertainment, Inc., Class A (USA) (1) 110,00 3,9 80,500 2,717
Village Roadshow Ltd., Class A, 1,131,60 1,9 1,131,601 2,133
5.50% preferred (Australia)
go.com (USA) (1) 69,00 1,6 69,000 1,867
Granada Group PLC (United Kingdom) 150,00 1,5 150,000 1,296
Carnival Corp. (USA) 7,10 3 7,100 313
Walt Disney Co. (USA) 76,90 2,2 7,000 195
MULTI- INDUSTRY - 2.06% / 1.93%
PT Multimedia (Indonesia) (1) 100,00 5,6 100,000 3,939
First Pacific Co. Ltd. (Hong Kong) 6,161,37 4,7 6,161,370 3,332
Orkla AS, Class A (Norway) 122,28 2,1 122,285 1,881
Preussag AG (Germany) 32,81 1,8 32,811 1,647
Lend Lease Corp. Ltd. (Australia) 43,90 6 43,900 561
ELECTRONIC INSTRUMENTS - 2.08% / 1.92%
Applied Materials, Inc. (USA) (1) 70,00 8,8 70,000 6,821
KLA - Tencor Corp. (USA) (1) 40,00 4,4 40,000 3,382
ADVANTEST CORP. (Japan) 6,60 1,7 6,600 1,106
IT CONSULTING & SERVICES - 2.27% / 1.75%
Infosys Technologies Ltd. (ADR) (India) 50,00 16,5 50,000 10,300
CHEMICALS - 1.23% / 1.60%
Monsanto Co. (USA) 115,00 4,0 115,000 4,852
BOC Group PLC (United Kingdom) 145,00 3,1 145,000 3,004
Valspar Corp. (USA) 40,00 1,6 40,000 1,568
AUTOMOBILES - 1.27% / 1.57%
Suzuki Motor Corp. (Japan) 281,00 4,1 281,000 4,147
Bayerische Motoren Werke AG (Germany) 74,36 2,2 74,360 1,984
Nissan Motor Co., Ltd. (Japan) (1) 357,00 1,4 357,000 1,669
Honda Motor Co., Ltd. (Japan) 39,00 1,4 35,000 1,447
RECREATION & OTHER CONSUMER PRODUCTS
- 1.07% / 1.42%
EMI Group PLC (United Kingdom) 459,40 4,4 557,000 4,589
Shimano Inc. (Japan) 120,00 2,1 120,000 2,357
Hasbro, Inc. (USA) 35,00 6 35,000 754
edel music AG (Germany) (1) 16,00 5 16,000 619
APPLIANCES & HOUSEHOLD DURABLES
- 1.53% / 1.26%
Sony Corp. (Japan) 29,60 8,7 29,600 5,507
THOMSON multimedia (France) (1) 43,30 2,3 43,300 1,875
INDUSTRIAL COMPONENTS - 0.84% / 0.96%
THK Co., Ltd (Japan) 120,00 4,8 120,000 4,690
NGK Spark Plug Co., Ltd. (Japan) 135,00 1,2 135,000 974
AEROSPACE & MILITARY TECHNOLOGY
- 0.79% / 0.95%
Bombardier Inc., Class B (Canada) 280,00 5,7 280,000 5,548
ENERGY SOURCES - 0.81% / 0.68%
Norsk Hydro AS (Norway) 80,00 3,3 40,000 1,563
Woodside Petroleum Ltd. (Australia) 142,00 1,0 142,000 1,013
TOTAL FINA SA, Class B (formerly TOTAL), 10,00 6 10,000 661
Class B (ADR) (France)
"Shell" Transport and Trading Co., PLC, 10,00 4 10,000 456
New York registered (United Kingdom)
Fletcher Challenge Energy (New Zealand) 123,03 3 123,030 278
WHOLESALE & INTERNATIONAL TRADE
- 0.55% / 0.63%
Li & Fung Ltd. (Hong Kong-Incorporated 1,600,00 4,0 1,600,000 3,678
in Bermuda)
FINANCIAL SERVICES - 0.40% / 0.49%
Shohkoh Fund & Co., Ltd. (Japan) 4,00 1,5 3,000 1,627
Capital One Financial Corp. (USA) 27,00 1,3 27,000 1,257
REAL ESTATE - 0.39% / 0.47%
Mandamus Fastigheter AB (formerly Mandamus AB) 377,60 2,3 377,600 2,242
(Sweden)
Unibail, bearer (France) 3,70 4 3,700 481
Unibail, warrants, expire 2004 (1) 3,70 3,700 16
TRANSPORTATION: AIRLINES - 0.36% / 0.41%
British Airways PLC (United Kingdom) 400,00 2,6 400,000 2,411
MISCELLANEOUS MATERIALS & COMMODITIES
- 0.43% / 0.40%
Sealed Air Corp. (USA) (1) 60,00 3,1 50,000 2,350
FOREST PRODUCTS & PAPER - 0.29% / 0.35%
Kimberly-Clark de Mexico, SA de CV (Mexico) 540,00 2,0 540,000 2,027
FOOD & HOUSEHOLD PRODUCTS - 0.21% / 0.34%
Reckitt Benckiser (formerly Reckitt & Colman PLC 165490 1,5 105,098 2,001
and Benckiser NV (United Kingdom)
GOLD MINES - 0.21% / 0.26%
Anglogold Ltd. (South Africa) 30,00 1,5 30,000 1,530
HEALTH CARE PROVIDERS & SERVICES - 0.15% / 0.23%
Quintiles Transnational Corp. (USA) (1) 60,00 1,1 60,000 1,324
BEVERAGES & TOBACCO - 0.15% / 0.21%
Coca-Cola Amatil Ltd. (Australia) 400,00 1,0 400,000 1,256
INSURANCE - 0.13% / 0.14%
Fairfax Financial Holdings Ltd. (Canada) (1) 5,00 8 5,000 737
Fairfax Financial Holdings Ltd., Subscriptions (1 60 1 600 88
MACHINERY & ENGINEERING - 0.08% / 0.09%
Kvaerner ASA, Class A (Norway) (1) 28,84 6 28,840 544
Miscellaneous - 2.70% / 1.02%
Other equity securities in initial period 19,580 5,968
of acquisition
---------- ----------
TOTAL EQUITY SECURITIES (cost: $395,540,000 660,231 547,200
and $385,368,000, respectively)
---------- ----------
Principal Principal
Amount Amount
Short-Term Securities (000) (000)
-------------------------------------------- -------- --------
Corporate Short-Term Notes - 7.22% / 4.95%
Wal-Mart Stores Inc. 5.26% due 12/17/1999 (2) $ 7,000 6,983
Alcoa Inc. 5.30% due 12/1/1999 6,500 6,499
Ford Motor Credit Co. 5.32% due 12/8/1999 5,000 4,994
Associates Corp. of North America 5.71% 4,600 4,599
due 12/1/1999
Xerox Capital (Europe) PLC 5.30% due 12/9/1999 3,500 3,495
Caisse d'amortissement de la dette sociale 2,500 2,499
5.20% due 12/3/1999
National Australia Funding (Delaware) Inc. $ 12,600 12,569
4.50%-5.95% due 1/3/2000-2/2/2000
Toyota Motor Credit Corp 6.00%-6.25% due 12,40 12,377
1/10/2000-1/13/2000
Amer Honda Finance Corp. 6.02% due 2/10/2000 10,00 9,932
DaimlerChrysler AG 5.99% due 1/31/2000 9,60 9,550
Sony Capital Corp 6.38% due 1/11/2000 5,00 4,990
BMW US Capital Corp CP 6.55% due 1/12/2000 3,00 2,993
Federal Agency Discount Notes - 1.68% / 4.35%
Fannie Mae 5.20%-5.48% due 12/13/1999-2/17/2000 7,50 7,4 16,000 15,965
Federal Home Loan Banks 5.36%-5.75% 8,000 7,988
due 12/10/1999-2/15/2000
Freddie Mac 5.20%-5.75% due 12/15/1999-2/15/2000 4,80 4,7 1,600 1,597
Non-U.S. Currency - 0.03% / 0.03%
New Taiwanese Dollar NT$6,410 2 NT$6,362 201
---------- ----------
TOTAL SHORT-TERM SECURITES (cost: 64,825 54,820
$64,822,000 and $54,819,000, respectively)
---------- ----------
TOTAL INVESTMENT SECURITIES (cost: 725,056 602,020
$460,362,000 and $440,187,000, respectively)
Net cash, receivables and payables 971 (14,503)
---------- ----------
NET ASSETS 726,027 587,517
========== ==========
(1) Non-income-producing security.
(2) Purchased in a private placement transaction;
resale to the public may require registration
or sale only to qualified institutional buyers.
(3) Valued under procedures established by
the Board of Trustees.
ADR = American Depository Receipts
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series Global
Small Capitalization Fund Investment Portfolio,
December 31, 1999 and November 30, 1999
<S> <C> <C>
Where the Fund's Assets Are Invested December 31, 19 November 30, 1999
Percent of Percent of
Net Assets Net Assets
The Americas 42.00% 39.18%
Europe 15.33% 14.59%
Asia/Pacific 29.50% 32.88%
Other Countries 3.23% 3.17%
Cash & Equivalents 9.94% 10.18%
100.00% 100.00%
</TABLE>
<TABLE>
American Variable Insurance Series Global
Small Capitalization Fund Investment Portfolio,
December 31, 1999 and November 30, 1999
<S> <C> <C>
November 30, 1999
LARGEST INDIVIDUAL EQUITY SECURITIES Percent of
Net Assets
HNC Software 3.15%
AVEX 2.36
Yushin Precision Equipment 2.30
Applied Micro Circuits 1.74
Picvue Electronics 1.57
Baltimore Technologies 1.53
Inet Technologies 1.52
Power Integrations 1.51
hi/fn 1.38
Fujitsu Devices 1.31
December 31, 1999
LARGEST INDIVIDUAL EQUITY SECURITIES Percent of
Net Assets
HNC Software 2.96%
Great Plains Software 2.85
Yushin Precision Equipment 2.78
Baltimore Technologies 2.21
Applied Micro Circuits 2.20
Picvue Electronics 1.67
AVEX 1.56
TranSwitch 1.51
Power Integrations 1.41
Apex 1.23
</TABLE>
<TABLE>
American Variable Insurance Series
Global Small Capitalization Fund
Investment Portfolio,
December 31, 1999 and November 30, 1999
<S> <C> <C> <C> <C> <C>
December 31 November 30
Market Market Percent
Number of Value Number of Value Of Net
EQUITY SECURITIES (common and preferred stocks) Shares (000) Shares (000) Assets
---------------------------------------------- ---------------------------------------------
ELECTRONIC COMPONENTS - 13.47% / 13.90%
Applied Micro Circuits Corp. (USA) (1) 50,000 $ 6,36 50,000 $ 4,15 1.74
Power Integrations, Inc. (USA) (1) 85,000 4,075 90,000 3,589 1.51
hi/fn, inc. (USA) (1) 75,000 2,906 75,000 3,300 1.38
Fujitsu Devices Inc. (Japan) 80,000 3,288 80,000 3,127 1.31
Micrel, Inc. (USA) (1) 60,000 3,416 60,000 2,955 1.24
Cymer, Inc. (USA) (1) 70,000 3,220 70,000 2,800 1.17
Venture Manufacturing (Singapore) Ltd (Singapore) 168,000 1,928 168,000 1,700
Venture Manufacturing (Singapore) Ltd (2) 90,000 1,033 90,000 911 1.10
MegaChips Corp. (Japan) - - 20,000 1,545 .65
CTX Opto-Electronics Corp (Taiwan)(1) 690,000 1,429 690,000 1,528 .64
DuPont Photomasks, Inc. (USA) (1) 20,000 965 20,000 1,230 .52
Komatsu Electronic Metals Co., Ltd. (Japan) 146,500 1,176 146,500 1,082 .45
Paltek (Japan) 30,000 1,233 25,000 982 .41
Veeco Instruments Inc. (USA) (1) 19,000 890 19,000 786 .33
NatSteel Electronics Ltd (Singapore) 175,000 926 175,000 724 .30
SOITEC SA (France) (1) 8,500 1,154 8,500 610 .26
Dialer and Business Electronics, Co. Ltd (Taiwan) (1) 840,000 1,499 447,000 590 .25
Sanmina Corp. (USA) (1) 5,000 499 5,000 481 .20
Tower Semiconductor Ltd. (Israel) (1) 35,500 388 35,500 379 .16
Dallas Semiconductor Corp. (USA) 5,800 374 5,800 334 .14
Varitronix International Ltd. (Hong Kong - 150,000 345 150,000 311 .13
Incorporated in Bermuda)
Acer Laboratories Inc. (Taiwan) (1) 300,000 1,807 - -
BUSINESS SERVICES - 10.66% / 12.28%
Computer Engineer & Consulting Ltd. (Japan) 85,000 2,271 85,000 2,912 1.22
ITE Group PLC (United Kingdom) 2,137,200 2,4862,137,200 2,866 1.20
Zuken Inc. (Japan) 70,000 2,679 64,800 2,673 1.12
Flextronics International Ltd. (USA - Incorporated 60,000 2,760 30,000 2,488 1.04
in Singapore) (1)
Photobition Group PLC (United Kingdom) 480,153 2,540 480,153 2,459 1.03
Black Box Corp. (USA) (1) 29,500 1,976 29,500 1,755 .74
Sapiens International Corp. NV (Israel) (1) 100,000 1,644 100,000 1,388 .58
Nippon Kanzai (Japan) 40,000 1,272 40,000 1,378 .58
Source Information Management Co. (USA) (1) 100,000 1,675 85,000 1,296 .54
Zhejiang Expressway Co. Ltd., Class H (China) 7,000,000 1,0637,000,000 1,127 .47
Corporate Services Group PLC (United Kingdom) 578,750 944 578,750 1,090 .46
OpenTV Corp., Class A (USA) (1) - - 11,100 857 .36
London Bridge Software Holdings PLC (United Kingdom) 10,200 719 10,200 755 .32
Lason, Inc. (USA) (1) - - 30,000 731 .31
InfoCure Corp. (USA) (1) - - 40,000 643 .27
Kroll-O'Gara Co. (USA) (1) 38,700 639 38,700 634 .27
Midas, Inc. (USA) 28,700 628 28,700 617 .26
Optosof AB, Class B (Sweden) (1) 33,800 850 33,800 561 .24
Falck A/S (Denmark) 7,000 734 5,000 498 .21
MDC Communications Corp., Class A (Canada) (1) 62,400 539 62,400 474 .20
NDS Group PLC, Class A (ADR) (United Kingdom)(1) 14,100 430 14,100 428 .18
eXchange Holdings PLC (United Kingdom) (1) 106,700 600 106,700 416
International Container Terminal 4,500,000 4094,500,000 374 .16
Services, Inc. (Philippines) (1)
Seminis, Inc., Class A (USA)(1) 40,000 252 40,000 220 .09
MEDION AG (Germany) 2,800 251 700 215 .09
Launch Media, Inc. (USA) (1) 38,100 721 10,500 194 .08
Brunel International NV (Netherlands) 13,048 118 13,048 139 .06
SciQuest.com, Inc. (USA) (1) - - 2,400 79 .03
Ituran Group (Israel) (1) 26,500 1,093 - -
Metron Technology NV (Netherlands) (1) 93,000 1,494 - -
DATA PROCESSING & REPRODUCTION -
11.59% / 10.18%
HNC Software Inc. (USA) (1) 80,900 8,555 105,900 7,519 3.15
Inet Technologies, Inc. (USA) (1) 44,500 3,109 60,000 3,630 1.52
Great Plains Software, Inc. (USA) (1) 110,000 8,223 50,000 2,672 1.12
Apex Inc. (USA) (1) 110,000 3,548 90,000 2,115 .89
RadiSys Corp. (USA) (1) 45,000 2,295 45,000 2,019 .85
MMC Networks, Inc. (USA) (1) 75,000 2,578 75,000 1,477 .62
Documentum, Inc. (USA) (1) 40,000 2,395 40,000 1,345 .56
Infowave Software, Inc. (Canada) (1) (2) - - 200,000 841
Infowave Software, Inc., warrants, 100,000 858 100,000 - .35
expire 2000 (1) (3)
Great Wall Technology Co. Ltd., Class H (China) (1) - - 964,500 813
National Computer Systems, Inc. (USA) 20,000 752 20,000 768 .32
Nice Systems Ltd. (ADR) (Israel) (1) 14,000 689 14,000 573 .24
Momentum Business Applications, Inc., 60,000 472 60,000 488 .20
Class A (USA) (1)
MERCHANDISING - 8.38% / 9.98%
Lands' End, Inc. (USA) (1) 51,000 1,772 51,000 3,079 1.29
Sharper Image Corp. (USA) (1) 160,000 2,030 150,000 3,019 1.27
Tsuruha Co., Ltd. (Japan) 20,000 2,642 20,000 2,953 1.24
Sundrug Co., Ltd. (Japan) 35,000 2,432 35,000 2,753 1.16
Senshukai Co., Ltd. (Japan) 140,000 1,877 140,000 2,521 1.06
Homac Corp. (Japan) 53,000 1,478 53,000 1,555 .65
DFS Furniture Co. PLC (United Kingdom) 250,000 1,454 250,000 1,317 .55
KOMERI Co., Ltd. (Japan) 40,000 1,213 40,000 1,284 .54
Rent-Way, Inc. (USA) (1) 81,000 1,514 55,000 839 .35
Too, Inc. (USA) (1) 45,000 776 45,000 832 .35
Migros Turk TAS (Turkey) 1,950,000 1,2591,950,000 800 .34
School Specialty, Inc. (USA) (1) 45,000 681 45,000 731 .31
Michaels Stores, Inc. (USA) (1) 14,500 413 14,500 455 .19
EUROBIKE AG (Germany) 40,000 402 40,000 445 .19
Giordano International Ltd. (Hong Kong) 400,000 412 400,000 399 .17
Dickson Concepts (International) Ltd. 310,000 391 310,000 319 .13
(Hong Kong--Incorporated in Bermuda)
Bombay Co., Inc. (USA) (1) 43,900 198 43,900 220 .09
Jean Coutu Group (PJC) Inc., Class A (Canada) 57,400 1,310 7,400 166 .07
Chapters Online Inc. (Canada) (1) 66,500 922 7,500 91 .04
Alloy Online, Inc. (USA) (1) 65,000 1,024 - -
ELECTRONIC INSTRUMENTS - 7.26% / 7.55%
Picvue Electronics, Ltd. (Taiwan) 4,000,000 4,8184,000,000 3,747 1.57
ASM Pacific Technology Ltd. (Hong Kong) 1,900,000 3,3731,900,000 3,046 1.28
Disco Corp. (Japan) 15,000 3,479 15,000 3,042 1.28
TranSwitch Corp. (USA) (1) 60,000 4,354 60,000 2,820 1.18
Densei Lambda KK (Japan) 43,000 1,347 43,000 1,854 .78
Lasertec Corp. (Japan) 55,000 1,459 55,000 1,684 .71
Orbotech Ltd. (Israel) (1) 18,000 1,395 12,000 1,098 .46
Etec Systems, Inc. (USA) (1) 16,600 745 16,600 714 .30
MACHINERY & ENGINEERING - 4.20% / 3.67%
Yushin Precision Equipment Co., Ltd. (Japan) 69,480 8,024 69,480 5,472 2.30
JOT Automation Group Oyj (Finland) 322,500 3,001 322,500 2,192 .92
HISAKA WORKS, LTD. (Japan) 200,000 851 200,000 906 .38
KCI Konecranes International Corp. (Finland) 6,800 261 6,800 186 .08
RECREATION & OTHER CONSUMER PRODUCTS
- 2.58% / 3.41%
AVEX Inc. (Japan) 18,000 4,492 18,000 5,617 2.36
GTR Group Inc. (Canada) (1) 393,000 1,060 393,000 1,053 .44
Movado Group, Inc. (USA) 55,000 1,200 30,000 713 .30
Radica Games Ltd. (Hong Kong) (1) 70,000 516 70,000 560 .23
Metromedia International Group, Inc. (USA) (1) 40,000 190 40,000 180 .08
BROADCASTING & PUBLISHING - 2.95% / 2.74%
Fox Kids Europe NV (United Kingdom) (1) 200,000 2,555 200,000 2,729
Westwood One, Inc. (USA) (1) 32,100 2,440 32,100 1,838 .77
APN News & Media Ltd (Australia) 414,857 912 414,857 845 .35
United Television, Inc. (USA) 6,000 813 6,000 803 .34
Radio Unica Communications Corp. (USA) (1) 11,400 329 11,400 315 .13
SBS Broadcasting SA (Luxembourg)(1) 30,000 1,461 - -
LEISURE & TOURISM - 2.70% / 2.64%
Station Casinos, Inc. (USA) (1) - - 89,600 2,150 .90
Four Seasons Hotels Inc. (Canada) 17,000 903 17,000 839 .35
Lions Gate Entertainment Corp. (Canada) (1) 300,000 684 300,000 702
Morton's Restaurant Group, Inc. (USA) (1) 70,000 1,085 45,000 672 .28
Imax Corp. (Canada) (1) 20,000 548 20,000 544 .23
Vail Resorts, Inc. (USA) (1) 113,300 2,032 20,000 344 .14
Corporacion Interamericana de Entretenimiento, 100,000 400 100,000 332 .14
SA de CV, Class B (Mexico) (1)
Kinepolis Group NV (Belgium) 3,544 303 3,544 299 .13
CinemaxX AG (Germany) (1) 12,000 193 12,000 219 .09
Alliance Atlantis Communications Inc., nonvoting, 20,000 166 20,000 181 .08
Class B (Canada) (1)
Lions Gate Entertainment Corp., Class A, 558 1,274 - -
convertible preferred (Canada) (1) (3)
Lions Gate Entertainment Corp., warrants, 237,150 216 - -
expire 2004 (1) (3)
HEALTH & PERSONAL CARE - 2.49% / 2.00%
ViroPharma Inc. (USA) (1) 50,000 1,850 50,000 1,225 .51
Genetronics Biomedical Ltd., warrants (Canada) (1) 250,000 778 250,000 746 .31
Pharmacyclics, Inc. (USA) (1) 20,000 825 20,000 688 .29
Nobel Biocare AB (Sweden) 45,100 636 45,100 653 .27
TriPath Imaging, Inc. (USA) (1) 94,836 391 94,836 622 .26
Aviron (USA) (1) 29,200 462 29,200 469 .20
Grupo Casa Autrey, SA de CV (ADR) (Mexico) (1) 44,900 371 44,900 376 .16
Women First HealthCare, Inc. (USA) (1) 360,000 1,890 - -
IT CONSULTING & SERVICES - 2.42% / 1.77%
Baltimore Technologies PLC (United Kingdom) (1) 77,363 6,373 77,363 3,643 1.53
Data Communication System Co., Ltd. (Japan) (1) 3,000 370 3,000 369 .15
Formula Systems (1985) Ltd. (ADR) (Israel) (1) 6,100 256 6,100 214 .09
BEVERAGES & TOBACCO - 1.93% / 1.73%
Montana Group Ltd. (formerly Corporate 1,250,000 1,3671,250,000 1,340 .56
Investments Ltd.) (New Zealand)
Shikoku Coca-Cola Bottling Co., Ltd. (Japan) 80,000 1,167 80,000 1,064 .45
Robert Mondavi Corp., Class A (USA) (1) 13,600 473 13,600 523 .22
Quilmes Industrial SA, nonvoting preferred 45,000 537 45,000 523 .22
(ADR) (Luxembourg)
Simeon Wines Ltd. (Australia) 156,140 348 156,140 338 .14
BRL Hardy Ltd. (Australia) 106,531 514 71,531 332 .14
Hokkaido Coca-Cola Bottling Co., Ltd. (Japan) 85,000 1,157 - -
WIRELESS TELECOMMUNICATION SERVICES
- 1.86% / 1.60%
Rogers Cantel Mobile Communications Inc., 50,000 1,821 50,000 1,605 .67
Class B, restricted voting (Canada) (1)
Tele Centro Oeste Celular Participacoes SA, 300,000 1,950 300,000 1,200 .50
preferred nominative (ADR) (Brazil)
Tele Celular Sul Participacoes SA, preferred 50,000 1,587 50,000 1,000 .42
nominative (ADR) (Brazil)
DIVERSIFIED TELECOMMUNICATION SERVICES
- 1.57% / 1.54%
Highpoint Telecommunications Inc., 380,000 2,345 380,000 1,863
convertible preferred (Canada) (1) (2) (3)
Highpoint Telecommunications Inc. (1) 130,000 944 130,000 750 1.10
Global Light Telecommunications Inc. (Canada) (1) 81,037 1,003 81,035 871 .37
Western Telecom (France) (1) 25,000 247 25,000 184 .08
ELECTRICAL & ELECTRONICS - 1.45% / 1.23%
Kokusai Electric Co., Ltd. (Japan) 170,000 2,396 170,000 2,360 .99
Maker Communications, Inc. (USA)(1) 15,000 641 15,000 345 .14
Finisar Corp. (USA) (1) - - 1,900 219 .09
ITG Group PLC (Ireland) (1) 98,029 1,144 - -
CHEMICALS - 1.51% / 1.02%
Omni Industries Ltd. (Singapore) 1,800,000 3,2671,100,000 1,408 .59
OM Group, Inc. (USA) 12,000 413 12,000 405 .17
Ionics, Inc. (USA) (1) 11,900 335 11,900 317 .13
Cambrex Corp. (USA) 10,000 344 10,000 315 .13
HEALTH CARE PROVIDERS & SERVICES
- 0.38% / 0.79%
Medicis Pharmaceutical Corp., Class A (USA) (1) - - 23,800 836 .35
Rhon-Klinikum AG, nonvoting preferred (Germany) 21,000 748 21,000 772 .32
ICON PLC (ADR) (Ireland) (1) 20,000 340 20,000 277 .12
APPLIANCES & HOUSEHOLD DURABLES
- 0.78% / 0.78%
Fisher & Paykel Industries Ltd. (New Zealand) 590,000 2,253 590,000 1,852 .78
REAL ESTATE - 0.70% / 0.76%
Wiggins Group PLC (United Kingdom) (1) 3,000,000 1,7083,000,000 1,509 .63
Mandamus AB (Sweden) 50,000 312 50,000 297 .12
BANKING - 0.55% / 0.62%
Industrial Finance Corp. of Thailand (Thailand) (1) 2,400,000 1,1852,400,000 1,046 .44
Laurentian Bank of Canada (Canada) 33,000 405 33,000 430 .18
METALS: NONFERROUS - 0.65% / 0.59%
Minmet PLC (Ireland) (1) (2) 5,796,138 1,8735,796,138 1,411 .59
ENERGY SOURCES - 1.05% / 0.55%
Mitchell Energy & Development Corp., 30,300 653 30,300 697 .29
nonvoting, Class B (USA)
Cabre Exploration Ltd. (Canada) (1) 40,000 332 40,000 304 .13
Northrock Resources Ltd. (Canada) (1) 36,900 245 36,900 204 .09
Premier Oil PLC (United Kingdom) (1) 430,000 101 430,000 106 .04
Western Oil Sands Inc., $5.00 units (Canada) 430,000 1,487 - -
(1) (2) (3)
Western Oil Sands Inc., $7.50 units (1) (2) (3) 43,333 225 - -
MISCELLANEOUS MATERIALS & COMMODITIES
- 1.12% / 0.53%
SPARTECH Corp. (USA) 100,000 3,225 40,000 1,262 .53
UTILITIES: ELECTRIC & GAS - 0.43% / 0.51%
International Energy Group Ltd. (United Kingdom) 360,000 1,233 360,000 1,224 .51
FOOD & HOUSEHOLD PRODUCTS - 0.41% / 0.46%
PT Indofood Sukses Makmur Tbk (Indonesia) (1) 700,000 878 700,000 770 .32
Geest PLC (United Kingdom) 45,000 298 45,000 325 .14
TRANSPORTATION: AIRLINES - 0.49% / 0.41%
SkyWest, Inc. (USA) 50,000 1,400 40,000 980 .41
TEXTILES & APPAREL - 0.25% / 0.30%
Esprit Holdings Ltd. (Hong Kong) 404,010 436 404,010 408 .17
Wolford Group (Austria) 7,300 288 7,300 312 .13
INSURANCE - 0.23% / 0.29%
Independent Insurance Group PLC (United Kingdom) 155,000 674 155,000 690 .29
WHOLESALE & INTERNATIONAL TRADE
- 0.26% / 0.29%
Li & Fung Ltd. (Hong Kong - Incorporated in Bermuda) 300,000 753 300,000 690 .29
AUTOMOBILES - 0.27% / 0.28%
Mahindra & Mahindra Ltd. (GDR) (India) 70,000 780 70,000 674 .28
FINANCIAL SERVICES - 0.17% / 0.26%
Nissin Co., Ltd. (Japan) 12,000 493 12,000 617 .26
EQUITY COMMON TRUSTS - 0.21% / 0.24%
Atle AB, Class A (Sweden) 36,800 601 36,800 567 .24
INDUSTRIAL COMPONENTS - 0.48% / 0.17%
Kiekert AG (Germany) 10,000 241 10,000 256 .11
THK Co., Ltd. (Japan) 4,000 162 4,000 157 .07
BERU AG (Germany) 34,200 981 - -
BUILDING MATERIALS & COMPONENTS
- 0.01% / 0.02%
Futuris Corp. Ltd. (Australia) 29,202 41 29,202 39 .02
MISCELLANEOUS - 4.60% / 4.73%
Other equity securities in initial period 13,291 11,274 4.73
of acquisition
----------- -----------
TOTAL EQUITY SECURITIES (cost: 260,098 214,074 89.82
$181,759.000, $156,635,000)
----------- ----------==========
Principal Principal Percent
Amount Amount Of Net
SHORT TERM SECURITIES (000) (000) Assets
----------------------------------------------- ---------------------------------------------
CORPORATE SHORT TERM NOTES - 6.78% / 6.16%
Associates Corp. of North America 5.71% - - $ 5,00 4,999 2.10
due 12/1/1999
Wal-Mart Stores, Inc. 5.56% due 12/13/1999 (2) - - 4,000 3,992 1.67
Ford Motor Credit Co. 5.32% due 12/8/1999 - - 3,000 2,996 1.26
Sony Capital Corp. 5.30% due 12/6/1999 (2) - - 2,700 2,698 1.13
Associates First Capital Corp. 4.00% due 1/3/2000 $ 5,62 5,618 - -
Arco British Ltd. 6.10% due 1/20/2000 (2) 5,200 5,182 - -
BMW US Capital Corp. 6.01% due 1/10/2000 4,800 4,792 - -
Toyota Motor Credit Corp. 6.25% due 1/13/2000 4,000 3,991 - -
FEDERAL AGENCY DISCOUNT NOTES
- 2.99% / 4.45%
Fannie Mae 5.21%-5.30% due 12/17/1999 - - 4,935 4,923
Freddie Mac 5.19%-5.75% due 12/16/1999-2/15/2000 8,700 8,645 3,400 3,392
Federal Home Loan Banks 5.36% due 12/10/1999 - - 2,300 2,296
NON-U.S. CURRENCY - 0.04% / 0.33%
New Taiwanese Dollar NT$3,206 102NT$3,177 792
----------- ------------
TOTAL SHORT-TERM SECURITIES (cost: 28,330 26,088
$28,329,000, $26,087,000)
----------- -----------
TOTAL INVESTMENT SECURITIES (cost: 288,428 240,162
$210,088,000, $182,722,000)
Net cash, receivables and payables 374 (1,824)
----------- ------------
NET ASSETS $ 288,802 $ 238,33
=========== ===========
(1) Non-income-producing security.
(2) Purchased in a private placement
transaction; resale to the institutional buyers.
(3) Valued under procedures established
by the Board of Trustees.
ADR = American Depositary Receipts
GDR = Global Depositary Receipts
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series
Growth Fund Investment Portfolio,
December 31 and November 30, 1999
<S> <C> <C> <C> <C>
December 31, November 30,
1999 1999
EQUITY SECURITIES 95.49% 93.71%
CASH &
EQUIVALENTS 4.51% 6.29%
Percent Percent
Of Net Of Net
Largest Individual Equity Securities Assets Assets
--------------------------------------------- --------- ---------
Viacom 5.15% Viacom 4.84%
Texas Instruments 3.33 Texas Instruments 3.77
Time Warner 3.26 Time Warner 3.17
Applied Materials 2.70 Applied Materials 2.61
Solectron 2.58 Solectron 2.55
KLA-Tencor 2.55 KLA-Tencor 2.42
Cendant 2.43 NTT Mobile
NTT Mobile Communications Network 2.05 Communications Networ 2.15
UnitedGlobalCom 1.99 Microchip Technology 1.83
Corning 1.98 Computer Associates
International 1.74
Cendant 1.73
Market Market
Number of Value Number of Value
Equity Securities (common and preferred stocks) Shares (000) Shares (000)
-------------------------------------------- ----------- ----------- ------------ ------------
ELECTRONIC COMPONENTS - 23.46%/23.91%
Texas Instruments Inc. 3,225,00 $ 312,42 3,225,0 $ 309,802
Solectron Corp.(1) 2,542,00 241,80 2,542,0 209,397
Microchip Technology Inc.(1) 2,365,00 161,85 2,365,0 149,882
Corning Inc. 1,437,30 185,32 1,437,3 134,657
Adaptec, Inc.(1) 2,286,00 114,01 2,286,0 123,158
Intel Corp. 1,546,60 127,30 1,596,6 122,439
Altera Corp.(1) 1,750,00 86,73 1,950,0 105,056
Linear Technology Corp. 1,420,40 101,64 1,450,0 103,041
SCI Systems, Inc.(1) 1,213,32 99,72 1,213,3 82,355
Taiwan Semiconductor Manufacturing Co. Ltd. 17,220,00 91,64 17,220,0 80,923
(Taiwan)(1)
Analog Devices, Inc.(1) 1,366,66 127,10 1,366,6 78,498
Jabil Circuit, Inc.(1) 1,100,00 80,30 1,200,0 76,725
Micron Technology, Inc.(1) 1,125,00 87,46 1,125,0 75,516
PMC-Sierra, Inc.(1) 600,00 96,18 600,0 61,838
LSI Logic Corp.(1) 1,000,00 67,50 1,000,0 60,438
Quantum Corp. - DLT & Storage Systems 2,900,00 43,86 2,900,0 45,675
(formerly Quantum Corp.)(1)
Quantum Corp. - Hard Disk Drive(1) 1,000,00 6,93 1,000,0 6,875
Maxim Integrated Products, Inc.(1) 1,200,00 56,62 600,0 48,188
Applied Micro Circuits Corp.(1) 300,00 38,17 300,0 24,937
Cypress Semiconductor Corp.(1) 850,00 27,51 850,0 23,162
Vitesse Semiconductor Corp.(1) 400,00 20,97 400,0 18,025
Seagate Technology(1) 200,00 9,31 200,0 7,400
Sanmina Corp.(1) 75,00 7,49 75,0 7,209
Newbridge Networks Corp. (Canada)(1) 300,00 6,76 300,0 6,787
BROADCASTING & PUBLISHING - 19.16%/18.21%
Viacom Inc., Class B (1) 7,100,00 429,10 7,100,0 353,225
Viacom Inc., Class A (1) 878,40 53,08 878,4 43,755
Time Warner Inc. 4,212,75 305,16 4,215,1 260,022
AT&T Corp. Liberty Media Group, Class A (1) 3,075,00 174,50 3,200,0 133,800
News Corp. Ltd., preferred (ADR) (Australia) 2,695,70 90,13 2,695,7 83,398
News Corp. Ltd. (ADR) 1,270,00 48,57 1,270,0 43,498
UnitedGlobalCom, Inc., Class A (formerly United 2,644,50 186,76 1,180,0 122,941
International Holdings, Inc.)(1)
USA Networks, Inc.(1) 2,970,00 164,09 2,970,0 118,800
CBS Corp.(1) 1,786,75 114,24 1,786,7 92,911
Fox Entertainment Group, Inc., Class A (1) 3,450,00 86,03 3,450,0 79,350
Cablevision Systems Corp., Class A (1) 600,00 45,30 700,0 47,994
Comcast Corp., Class A, special stock 550,00 27,80 1,050,0 47,447
BHC Communications, Inc., Class A (1) 286,18 45,79 286,1 45,218
AMFM Inc. (formerly Chancellor Media Corp.)(1) 185,70 14,53 185,7 13,127
Clear Channel Communications, Inc.(1) 115,73 10,32 115,7 9,302
DATA PROCESSING & REPRODUCTION - 12.08%/9.87%
Computer Associates International, Inc. 2,200,00 153,86 2,200,0 143,000
Oracle Corp.(1) 1,450,00 162,49 1,650,0 111,891
3Com Corp. (1) 3,255,00 152,98 2,730,8 108,720
Microsoft Corp.(1) 1,150,00 134,26 1,050,0 95,599
PeopleSoft, Inc.(1) 6,025,92 128,42 4,950,0 93,122
Fujitsu Ltd. (Japan) 1,880,00 85,73 1,880,0 66,997
Lexmark International Group, Inc., Class A (1) 510,00 46,15 510,0 42,330
Storage Technology Corp.(1) 1,850,00 34,10 1,850,0 36,538
Gateway, Inc. (formerly Gateway 2000, Inc.)(1) 325,70 23,47 400,0 30,550
Autodesk, Inc. 920,00 31,05 920,0 26,967
Vantive Corp.(1) - - 1,304,1 20,214
Rambus Inc.(1) - - 275,0 19,405
Compaq Computer Corp. 300,00 8,11 300,0 7,331
Mentor Graphics Corp.(1) 800,00 10,55 800,0 7,200
Cadence Design Systems, Inc. (1) 6,700,00 160,800
ELECTRONIC INSTRUMENTS - 6.92%/6.36%
Applied Materials, Inc.(1) 2,000,00 253,37 2,200,0 214,362
KLA-Tencor Corp.(1) 2,150,00 239,45 2,350,0 198,722
PE Corp.-PE Biosystems Group 727,80 87,56 727,8 59,407
Teradyne, Inc.(1) 950,00 62,70 950,0 41,384
ANTEC Corp.(1) 150,00 5,47 150,0 8,400
HEALTH & PERSONAL CARE - 6.38%/5.57%
AstraZeneca PLC (United Kingdom) 1,750,00 72,70 1,750,0 78,635
Cardinal Health, Inc. 2,150,00 102,93 1,478,0 77,318
Amgen Inc.(1) 800,00 48,05 800,0 36,450
Pfizer Inc 3,300,00 107,04 822,4 29,761
Millennium Pharmaceuticals, Inc.(1) 300,00 36,60 300,0 29,203
Sepracor Inc.(1) 290,40 28,80 290,4 28,205
Guidant Corp.(1) 500,00 23,50 500,0 25,000
MedImmune, Inc.(1) 200,00 33,17 200,0 24,038
Gilead Sciences, Inc.(1) 500,00 27,06 500,0 24,000
Omnicare, Inc. 1,650,00 19,80 1,650,0 22,378
Forest Laboratories, Inc.(1) 300,00 18,43 300,0 15,356
Warner-Lambert Co. 150,00 12,29 150,0 13,453
PE Corp.-Celera Genomics(1) 181,95 27,11 181,9 11,145
Novoste Corp.(1) 700,00 11,55 700,0 10,544
BioChem Pharma Inc. (Canada)(1) - - 400,0 9,150
Biogen, Inc.(1) 100,00 8,45 100,0 7,306
Inhale Therapeutic Systems, Inc.(1)(2) 200,00 8,51 200,0 6,125
Genentech, Inc.(1) 49,60 6,67 49,6 4,259
Guilford Pharmaceuticals, Inc.(1) 200,00 3,40 200,0 2,925
Pharmacia & Upjohn, Inc. 36,25 1,63 36,2 1,982
BUSINESS SERVICES - 5.37%/4.87%
Cendant Corp.(1) 8,564,80 227,50 8,564,8 141,855
Federal Express Corp.(1) 1,400,00 57,31 1,400,0 59,063
Juniper Networks, Inc.(1) 145,70 49,53 145,7 40,377
Concord EFS, Inc.(1) 1,276,35 32,86 1,276,3 33,823
Flextronics International Ltd. (USA - 600,00 27,60 300,0 24,881
Incorporated in Singapore)(1)
Allied Waste Industries, Inc.(1) 2,950,00 25,99 2,850,0 23,156
Robert Half International Inc.(1) 800,00 22,85 800,0 22,400
Waste Management, Inc. 1,200,00 20,62 1,200,0 19,500
United Parcel Service, Inc. Class B 186,20 12,84 186,2 12,301
Avery Dennison Corp. 200,00 14,57 200,0 11,875
Paychex, Inc. 187,50 7,50 187,5 7,488
Snyder Communications, Inc.(1) 200,00 3,85 200,0 2,688
ELECTRICAL & ELECTRONICS - 3.77%/3.51%
NEC Corp. (Japan) 4,000,00 95,32 4,000,0 93,916
Telefonaktiebolaget LM Ericsson, Class B 1,240,00 81,45 1,240,0 59,753
(ADR) (Sweden)
Nortel Networks Corp. (Canada) 780,00 78,78 780,0 57,720
General Instrument Corp.(1) 600,00 51,00 600,0 39,300
Nokia Corp., Class A (ADR) (Finland) 180,00 34,20 180,0 24,874
Lucent Technologies Inc. (formerly Ascend 165,00 12,34 165,0 12,055
Communications, Inc.)
WIRELESS TELECOMMUNICATION SERVICES
- 2.36%/2.54%
NTT Mobile Communications Network, Inc. (Japan) 5,00 192,30 5,0 176,216
Nextel Communications, Inc., Class A(1) 100,00 10,31 200,0 19,825
Crown Castle International Corp.(1) 550,00 17,66 550,0 11,584
Paging Network, Inc.(1) 1,500,00 1,21 1,500,0 1,078
BANKING - 1.74%/2.30%
Sakura Bank, Ltd. (Japan) 8,000,00 46,35 8,000,0 59,460
Washington Mutual, Inc. 1,325,00 34,45 1,325,0 38,425
Charter One Financial, Inc. 1,459,00 27,90 1,359,0 29,473
Fleet Boston Corp. (formerly BankBoston Corp.) 688,94 23,98 688,9 26,051
Wells Fargo & Co. 500,00 20,21 500,0 23,250
M&T Bank Corp. 25,00 10,35 25,0 11,750
TRANSPORTATION: AIRLINES - 1.49%/1.63%
AMR Corp.(1) 1,100,00 73,70 1,100,0 66,962
Southwest Airlines Co. 3,644,76 58,99 3,644,7 59,455
Delta Air Lines, Inc. 150,00 7,47 150,0 7,388
LEISURE & TOURISM - 1.36%/1.59%
Starbucks Corp. (1) 2,600,00 63,05 2,600,0 69,063
Carnival Corp. 1,184,80 56,64 1,184,8 52,279
go.com (1) 341,20 8,12 341,2 9,234
CHEMICALS - 1.24%/1.54%
Monsanto Co. 2,000,00 71,25 2,000,0 84,375
Valspar Corp. 750,00 31,40 750,0 29,391
Air Products and Chemicals, Inc. 400,00 13,42 400,0 12,950
ENERGY SOURCES - 1.33%/1.46%
Murphy Oil Corp. 609,70 34,98 609,7 34,448
Pogo Producing Co. 1,599,30 32,78 1,524,3 27,437
EOG Resources, Inc. 1,400,00 24,58 1,400,0 25,900
Enterprise Oil PLC (United Kingdom) 1,700,00 11,57 1,700,0 12,213
Talisman Energy Inc. (Canada)(1) 400,00 10,20 400,0 10,205
TOTAL FINA SA, Class B (ADR)(formerly TOTAL) 150,00 10,38 150,0 9,919
(France)
MERCHANDISING - 1.15%/1.27%
Consolidated Stores Corp.(1) 2,152,42 34,97 2,152,4 33,901
Sunglass Hut International, Inc.(1) 2,203,00 24,78 2,203,0 26,987
Limited Inc. 550,00 23,82 550,0 23,340
Lowe's Companies, Inc. 400,00 23,90 400,0 19,925
HEALTH CARE PROVIDERS & SERVICES
- 1.25%/1.17%
Columbia/HCA Healthcare Corp. 2,890,30 84,72 1,468,1 40,006
Quintiles Transnational Corp.(1) 800,00 14,95 1,800,0 39,712
Universal Health Services, Inc., Class B (1) 500,00 18,00 500,0 16,469
FINANCIAL SERVICES - 0.97%/1.10%
Capital One Financial Corp. 685,70 33,04 685,7 31,928
Household International, Inc. 700,00 26,07 700,0 27,694
Providian Financial Corp. 200,00 18,21 200,0 15,825
Fannie Mae 225,00 14,04 225,0 14,990
BEVERAGES & TOBACCO - 0.67%/0.77%
Coca-Cola West Japan Co. Ltd. (formerly 800,00 33,66 800,0 32,290
Kita Kyushu Coca-Cola Bottling Co., Ltd.) (Japan)
Philip Morris Companies Inc. 655,00 15,18 655,0 17,235
PepsiCo, Inc. 400,00 14,10 400,0 13,825
TEXTILES & APPAREL - 0.69%/0.73%
NIKE, Inc., Class B 1,300,00 64,43 1,300,0 59,800
DIVERSIFIED TELECOMMUNICATION
SERVICES - 0.54%/0.67%
Teleglobe Inc. (Canada) 1,535,00 34,83 1,535,0 38,253
MCI WorldCom, Inc.(1) 300,00 15,91 200,0 16,537
INSURANCE - 0.55%/0.61%
XL Capital Ltd. (Bermuda - Incorporated in the 710,00 36,83 710,0 36,210
Cayman Islands)
MGIC Investment Corp. 250,00 15,04 250,0 14,125
MISCELLANEOUS MATERIALS & COMMODITIES
- 0.47%/0.49%
Sealed Air Corp.(1) 850,00 44,04 850,0 39,950
RECREATION & OTHER CONSUMER
PRODUCTS - 0.34%/0.44%
Hasbro, Inc. 1,675,00 31,93 1,675,0 36,117
FOOD & HOUSEHOLD PRODUCTS - 0.31%/0.35%
Keebler Foods Co.(1) 600,00 16,87 600,0 16,537
Dole Food Co., Inc. 750,00 12,18 750,0 12,000
UTILITIES: ELECTRIC & GAS - 0.14%/0.18%
Questar Corp. 850,00 12,75 850,0 14,609
ENERGY EQUIPMENT - 0.09%/0.11%
Schlumberger Ltd. (Netherlands Antilles) 150,00 8,43 150,0 9,009
MACHINERY & ENGINEERING - 0.03%/0.04%
Thermo Electron Corp.(1) 200,00 3,00 200,0 3,000
TRANSPORTATION: RAIL & ROAD - 0.03%/0.03%
Wisconsin Central Transportation Corp.(1) 200,00 2,68 200,0 2,806
Miscellaneous - 1.60%/2.39%
Other equity securities in initial period 149,962 196,489
of acquisition
------------ ------------
TOTAL EQUITY SECURITIES (cost: 8,950,427 7,691,068
$4,602,249,000 and $4,462,086,000, respectively)
------------ ------------
Principal Principal
Amount Amount
SHORT-TERM SECURITIES (000) (000)
-------------------------------------------- ------------------------ ------------ ------------
CORPORATE SHORT-TERM NOTES - 4.01%/6.59%
Park Avenue Receivables Corp. 5.95%-5.97% $ 45,00 44,92 $ 45,0 44,691
due 1/10-1/11/2000 (2)
PACCAR Financial Corp. 5.47%-5.79% due 10,00 9,93 36,0 35,809
12/20/1999-2/7/2000
BellSouth Capital Funding Corp. 5.67%-5.84% 10,00 9,92 36,0 35,568
due 2/10-2/16/2000 (2)
American Express Credit Corp. 5.28%-5.31% - - 35,6 35,558
due 12/1-12/17/1999
SBC Communications Inc. 5.67%-5.77% 21,28 21,23 35,6 35,285
due 1/14-2/18/2000 (2)
National Rural Utilities Cooperative Finance Corp 15,00 14,90 35,0 34,804
5.30%-5.80% due 12/9/1999-2/7/2000
Pfizer Inc 5.80%-5.93% due 1/19-3/1/2000 (2) 34,30 34,09 34,3 33,926
International Lease Finance Corp. 5.76%-5.91% 18,72 18,63 33,2 32,887
due 2/1-2/3/2000
Kellogg Co. 5.80% due 3/8/2000 (2) 17,50 17,31 33,0 32,475
Motiva Enterprises LLC 5.90% due 1/27/2000 30,00 29,86 30,0 29,718
Procter & Gamble Co. 5.87%-5.90% due 2/4/2000 - - 27,3 27,007
General Electric Capital Corp. 5.84% due 1/20/200 26,00 25,91 26,0 25,784
Fortune Brands Inc. 5.90%-6.08% due 37,60 37,44 20,0 19,818
1/24-1/25/2000 (2)
Eastman Kodak Co. 5.67% due 1/28/2000 20,00 19,90 20,0 19,809
Minnesota Mining & Manufacturing Co. 20,00 19,82 20,0 19,729
5.84% due 2/22/2000
Halliburton Co. 5.27%-5.28% due 12/8-12/10/1999 - - 19,0 19,065
Bestfoods 5.30%-5.47% due 12/10-12/21/1999 (2) - - 18,8 18,760
Monsanto Co. 5.32% due 12/14/1999 - - 15,0 14,969
Lucent Technologies Inc. 5.75%-6.00% 25,00 24,76 15,0 14,794
due 2/23-3/2/2000
Equilon Enterprises, LLC 5.87% due 2/3/2000 10,40 10,34 10,4 10,288
Associates First Capital Corp. 4.00% due 1/3/2000 14,80 14,79 - -
Scripps (E.W.) Co. 6.02% due 3/16/2000 (2) 11,50 11,35 - -
Anheuser Busch Co. 6.05% due 2/11/2000 5,60 5,56 - -
Duke Energy Corp. 6.08% due 2/18/2000 3,90 3,86 - -
Avon Capital Corp. 6.70% due 1/6/2000 (2) 1,10 1,09 - -
FEDERAL AGENCY DISCOUNT NOTES - 0.48%/0.33%
Freddie Mac 5.20%-5.94% due 12/13/1999-2/15/2000 34,95 34,69 27,100 26,862
Fannie Mae 5.67% due 2/24/2000 10,00 9,91 - -
NON-U.S. CURRENCY - 0.04%/0.05%
New Taiwanese Dollar NT$126,350 4,02 NT$125,305 3,965
------------ ------------
TOTAL SHORT-TERM SECURITIES (cost: 424,359 571,571
$424,141,000 and $571,404,000, respectively)
------------ ------------
TOTAL INVESTMENT SECURITIES (cost: 9,374,786 8,262,639
$5,026,390,000 and $5,033,490,000, respectively)
Net cash, receivables and payables (2,012) (55,659)
------------ ------------
NET ASSETS $ 9,372,774 $ 8,206,980
============= =============
(1) Non-income-producing security.
(2) Purchased in a private placement transaction;
resale to the public may require registration or
sale only to qualified institutional buyers.
ADR = American Depositary Receipts
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series
International Fund
Investment Portfolio
<S> <C> <C> <c. <C>
Where the Fund's Assets Are Invested
Dec. 31, 1999 Nov. 30, 1999
Percent of Percent of
Net Assets Net Assets
-------- --------
EUROPE 48.73% 49.33%
ASIA/PACIFIC 35.06% 34.86%
THE AMERICAS 8.57% 8.76%
OTHER COUNTRIES 1.89% 1.75%
CASH & EQUIVALENTS 5.75% 5.30%
Largest Individual Stocks
Dec. 31, 1999 Nov. 30, 1999
Mannesmann 3.55% Nokia 3.35%
Nokia 3.37%Telefonos de Mex 2.49%
Rohm 2.59% Telefonica 2.28%
Telefonos de Mexico 2.58% Orange 2.20%
Telefonica 2.36% Mannesmann 2.13%
Sony 2.24% Rohm 2.02%
Mediaset 2.04%Telefonaktiebola 1.97%
Telefonaktiebolaget LM Ericsson 2.04% LM Ericsson
Deutsche Telekom 1.97% AstraZeneca 1.96%
Murata Manufacturing 1.83%Samsung Electro 1.88%
Mechanics
Deutsche Telekom 1.86%
Dec. 31, 1999 Nov. 30, 1999
Market Market
Number of Value Number of Value
Stocks (common and preferred) Shares (000) Shares (000)
-------------------------------------------- -------- -------- -------- --------
BROADCASTING & PUBLISHING
- 17.89%/15.45%
Mediaset SpA (Italy) 5,967,00 $92,095 5,967,000 $68,164
United Pan-Europe Communications NV 600,00 76,65 600,000 58,910
(Netherlands) (1)
CANAL + (France) 497,67 72,34 497,672 41,145
Flextech PLC (United Kingdom) (1) 2,250,00 42,74 2,250,000 38,953
Metropole Television (France) 106,00 52,46 106,000 34,905
Fuji Television Network Inc. (Japan) (1) 4,13 56,62 3,733 34,728
Television Broadcasts Ltd. (Hong Kong) 5,089,30 34,70 5,089,300 33,094
KirchMedia GmbH & Co. KGaA (Germany) 675,51 29,79 675,511 29,825
(1) (2) (3)
British Sky Broadcasting Group PLC 2,200,00 35,53 2,200,000 29,163
(United Kingdom) (1)
Television Francaise 1 SA (France) 80,00 41,85 80,000 29,002
Seat Pagine Gialle SpA (Italy) 20,000,00 43,90 20,000,000 23,161
Austar United Communications Ltd. 6,508,20 26,06 5,898,200 21,781
(Australia) (1)
Sogecable, SA (Spain) (1) 660,10 42,10 660,100 20,866
Nippon Television Network Corp. (Japan) 21,00 24,66 21,000 20,074
News Corp. Ltd. (ADR) (Australia) 362,00 13,84 362,000 12,399
News Corp. Ltd., preferred (ADR) 181,00 6,05 181,000 5,600
News Corp. Ltd., preferred 201,48 1,72 201,480 1,568
ProSieben Media AG (Germany) 400,00 23,21 400,000 18,617
Grupo Televisa, SA (ADR)(Mexico) (1) 360,00 24,57 360,000 17,573
Publishing & Broadcasting Ltd. (Australia) 2,350,00 17,94 2,350,000 15,471
Modern Times Group MTG AB, Class B 61,00 16,16 61,000 10,500
(ADR) (Sweden) (1)
Modern Times Group MTG AB, Class A (1) 101,60 5,01 101,600 3,131
Axel Springer Verlag AG (Germany) 10,00 11,87 10,000 10,070
SBS Broadcasting SA (Luxembourg) (1) 158,80 7,73 158,800 6,431
Fox Kids Europe NV (Netherlands) (1) 430,00 5,49 430,000 5,867
Societe Europeenne des Satellites, SA, -- -- 8,908 1,121
Class A (FDR) (Luxembourg)
Primedia Ltd., units (South Africa) 391,63 50 391,631 399
Primedia Ltd., units, Class N 179,63 22 179,635 180
DIVERSIFIED TELECOMMUNICATION SERVICES
- 12.40%/12.09%
Telefonos de Mexico, SA de CV, Class L 1,032,00 116,10 1,032,000 95,525
(ADR) (Mexico)
Telefonica, SA (Spain) (1) 3,121,20 77,87 3,121,200 64,744
Telefonica, SA (ADR)(1) 362,93 28,60 362,931 22,547
Deutsche Telekom AG (Germany) 1,245,71 88,60 1,245,712 71,314
Telecom Italia SpA, nonconvertible savings 7,884,16 48,01 7,884,165 42,484
(Italy)
Telecom Italia SpA 345,00 4,84 345,000 3,773
Swisscom AG (Switzerland) 121,49 49,14 121,494 41,234
Nippon Telegraph and Telephone Corp. 1,85 31,68 1,850 33,328
(Japan)
Korea Telecom Corp. (ADR) (South Korea) 617,90 46,18 617,900 32,749
Videsh Sanchar Nigam Ltd. (GDR) (India) 838,60 20,79 838,600 19,288
Philippine Long Distance Telephone Co. 205,00 5,22 205,000 4,210
(Philippines)
Philippine Long Distance Telephone Co., 80,00 3,81 80,000 3,260
convertible preferred (GDR)
Philippine Long Distance Telephone Co. (ADR) 154,00 3,98 154,000 3,157
Telefonica de Argentina SA, Class B (ADR) 350,00 10,80 280,000 7,368
(Argentina)
Bayan Telecommunications Holdings Corp., 150,00 7,08 150,000 6,959
convertible preferred (Philippines) (1) (2) (3)
Bayan Telecommunications Holdings Corp. 30,30 7 30,308 74
(1) (2) (3)
Bayan Telecommunications Holdings Corp., 20,27 5 20,279 50
Class A (1) (2) (3)
Bayan Telecomunications Holdings Corp., 6,62 1 6,622 16
Class B (1) (2) (3)
Koninklijke PTT Nederland NV (Netherlands) 117,68 11,47 117,683 6,553
Telstra Corp. Ltd. (Australia) 700,00 3,80 700,000 4,083
Perusahaan Perseroan (Persero) PT Indonesian -- -- 350,300 491
Satellite Corp. (Indonesia)
Perusahaan Perseroan (Persero) PT -- -- 20,000 278
Compania de Telecomunicaciones de 26,17 47 26,170 481
Chile SA (ADR) (Chile)
ELECTRICAL & ELECTRONICS - 9.47%/9.52%
Nokia Corp. (Finland) 838,00 151,74 908,000 128,558
Telefonaktiebolaget LM Ericsson, Class B (Sweden) 1,018,70 65,51 1,157,200 56,138
Telefonaktiebolaget LM Ericsson, Class B (ADR) 400,00 26,27 400,000 19,275
Chartered Semiconductor Manufacturing Ltd 650,80 47,50 650,800 34,655
(ADR) (Singapore) (1)
NEC Corp. (Japan) 1,414,00 33,69 1,414,000 33,199
Toshiba Corp. (Japan) 4,230,00 32,29 4,230,000 31,273
Nortel Networks Corp. (Canada) 300,00 30,30 400,000 29,600
Hitachi, Ltd. (Japan) 1,970,00 31,61 1,970,000 27,345
Premier Farnell PLC (United Kingdom) 1,000,00 7,44 1,000,000 5,428
ELECTRONIC COMPONENTS - 9.13%/9.08%
Rohm Co., Ltd. (Japan) 284,00 116,73 284,000 77,388
Samsung Electro-Mechanics Co. (South Korea) (1) 927,73 61,71 927,730 72,041
Murata Manufacturing Co., Ltd. (Japan) 351,00 82,44 411,000 68,460
Taiwan Semiconductor Manufacturing Co. Ltd. 13,393,50 71,27 13,393,500 62,941
(Taiwan) (1)
Hirose Electric Co., Ltd. (Japan) 111,00 24,88 111,000 18,631
Hon Hai Precision Industry Co. Ltd. (Taiwan) (1) 1,960,00 14,61 1,960,000 14,018
Hoya Corp. (Japan) 175,00 13,78 175,000 12,749
Samsung Electronics Co., Ltd. (South Korea) 53,60 12,56 53,600 11,099
ATI Technologies Inc. (Canada) (1) 1,000,00 13,20 1,000,000 10,958
WIRELESS TELECOMMUNICATION SERVICES
- 8.05%/8.81%
Mannesmann AG (fomerly Orange PLC) (Germany) 271,10 65,32 2,809,400 84,462
Mannesmann AG (ADR) 390,00 94,77 390,000 81,900
DDI Corp. (Japan) 2,60 35,62 2,600 36,090
China Telecom (Hong Kong) Ltd. (ADR) 314,60 40,44 314,600 33,072
(People's Republic of China) (1)
NTT Mobile Communications Network, Inc. (Japan) 81 31,34 815 28,723
Vodafone Airtouch PLC (formerly Vodafone 6,000,00 29,56 6,000,000 28,280
Group PLC) (United Kingdom)
Telecom Italia Mobile SpA (Italy) 2,000,00 22,25 2,000,000 15,604
Telecom Italia Mobile SpA, savings 1,312,80 6,23 1,312,800 5,074
SK Telecom Co., Ltd. (South Korea) 3,26 11,72 3,269 7,556
SK Telecom Co., Ltd. (ADR) 285,79 10,96 277,470 6,573
Partner Communications Co. Ltd. (ADR) 370,20 9,57 370,200 6,941
(Israel) (1)
TELECEL - Comunicacoes Pessoais, SA (Portugal) 282,00 4,91 282,000 3,731
BANKING - 4.16%/4.74%
ABN AMRO Holding NV (Netherlands) 1,937,24 48,33 1,937,245 47,151
Banque Nationale de Paris (France) 395,35 36,43 395,350 36,229
Banque Nationale de Paris, guaranteed 53,95 24 53,950 231
value certificates, expire 2002 (1)
DBS Group Holdings Ltd. (formerly Development 1,628,20 26,71 1,628,200 21,128
Bank of Singapore Ltd.) (Singapore)
Bank of Nova Scotia (Canada) 975,00 20,93 975,000 21,037
Westpac Banking Corp. (Australia) 2,400,23 16,55 2,400,238 16,176
Sakura Bank, Ltd. (Japan) 1,870,00 10,83 1,720,000 12,784
Bank of Scotland (United Kingdom) 711,63 8,26 711,635 8,468
Bangkok Bank PCL (Thailand) (1) 3,500,00 8,87 3,500,000 7,496
Fuji Bank, Ltd. (Japan) 470,00 4,56 470,000 5,654
Commonwealth Bank of Australia (Australia) 245,00 4,21 245,000 4,046
Standard Chartered Bank (United Kingdom) 101,63 1,57 101,630 1,374
BUSINESS SERVICES - 4.62%/4.33%
Terra Networks, SA (Spain) (1) 1,421,30 77,56 1,421,300 48,963
Adecco SA (Switzerland) (1) 50,00 38,94 50,000 31,959
Brambles Industries Ltd. (Australia) 925,68 25,59 925,682 25,429
Aegis Group PLC (United Kingdom) 7,350,00 26,71 7,350,000 21,121
TNT Post Groep (Netherlands) 643,19 18,40 643,198 16,452
Rentokil Initial PLC (United Kingdom) 3,144,10 11,47 3,144,100 12,047
Vivendi SA (France) 88,14 7,95 88,147 7,057
Zhejiang Expressway Co. Ltd., Class H 10,298,00 1,56 10,298,000 1,658
(People's Republic of China)
ecorp Ltd. (Australia) (1) -- -- 805,300 1,338
Metropolis Transactive Holdings Ltd. 58,76 1 58,765 8
(South Africa) (1)
MERCHANDISING - 3.00%/3.98%
Dixons Group PLC (United Kingdom) 2,800,10 67,39 2,800,100 59,624
EM.TV & Merchandising AG (Germany) 389,80 25,09 350,000 27,315
EM.TV & Merchandising AG (1) 70,20 4,52 70,200 5,302
Carrefour SA (France) -- -- 88,000 15,331
Cifra, SA de CV, Class C (Mexico) (1) 6,000,00 11,44 6,000,000 10,555
Cifra, SA de CV, Class V (1) -- -- 2,467,300 4,613
Ito-Yokado Co., Ltd. (Japan) 135,00 14,66 135,000 14,619
Kingfisher PLC (United Kingdom) 557,22 6,16 557,224 5,186
Koninklijke Ahold NV (Netherlands) -- -- 145,000 4,616
Loblaw Companies Ltd. (Canada) 150,00 3,65 150,000 3,511
Coles Myer Ltd. (Australia) 400,61 2,06 400,618 2,041
HEALTH & PERSONAL CARE - 2.84%/3.57%
AstraZeneca PLC (United Kingdom) 1,677,05 70,65 1,677,054 75,049
Fujisawa Pharmaceutical Co. Ltd. (Japan) 1,829,00 44,39 1,829,000 49,605
Elan Corp., PLC (ADR) (Ireland) (1) 332,80 9,81 332,800 9,110
SmithKline Beecham PLC (ADR) (United Kingdom) 50,00 3,22 50,000 3,325
APPLIANCES & HOUSEHOLD DURABLES
- 3.06%/2.59%
Sony Corp. (Japan) 340,00 100,82 340,000 63,260
Koninklijke Philips Electronics NV (Netherlands) 240,20 32,62 240,200 29,231
THOMSON multimedia (France) (1) 78,40 4,22 156,700 6,785
AUTOMOBILES - 1.74%/2.28%
Bayerische Motoren Werke AG (Germany) 1,144,00 34,87 1,622,400 43,295
Suzuki Motor Corp. (Japan) 1,700,00 24,80 1,700,000 25,087
Honda Motor Co., Ltd. (Japan) 504,00 18,74 461,000 19,061
RECREATION & OTHER CONSUMER PRODUCTS
- 1.59%/1.94%
Nintendo Co., Ltd. (Japan) 210,00 34,89 210,000 35,165
Sony Music Entertainment (Japan) Inc. (Japan) (3) 90,00 22,28 90,000 13,999
EMI Group PLC (United Kingdom) 1,500,00 14,53 1,500,000 12,359
Square Co., Ltd. (Japan) -- -- 108,600 6,628
edel music AG (Germany) (1) -- -- 160,000 6,187
ENERGY SOURCES - 1.57%/1.62%
Broken Hill Proprietary Co. Ltd. (Australia) 3,611,61 47,42 3,611,615 39,660
TOTAL FINA SA, Class B (formerly Elf Aquitaine) 48,94 6,52 48,944 6,511
(France)
TOTAL FINA SA, Class B (ADR) (formerly TOTAL) 55,00 3,80 55,000 3,637
Woodside Petroleum Ltd. (Australia) 600,00 4,43 600,000 4,279
"Shell" Transport and Trading Co., PLC, 90,00 4,43 90,000 4,106
New York registered (United Kingdom)
Norsk Hydro AS (Norway) 100,00 4,18 100,000 3,907
MULTI-INDUSTRY - 1.35%/1.44%
Orkla AS, Class A (Norway) 2,097,94 36,06 2,097,942 32,270
Lend Lease Corp. Ltd. (Australia) 962,63 13,48 962,630 12,289
Preussag AG (Germany) 160,02 8,90 160,029 8,032
Benpres Holdings Corp. (GDR) (Philippines) (1) 771,10 2,22 956,000 2,868
AEROSPACE & MILITARY TECHNOLOGY - 1.27%/1.44%
Bombardier Inc., Class B (Canada) 2,787,80 57,16 2,787,800 55,234
DATA PROCESSING & REPRODUCTION - 1.77%/1.44%
Fujitsu Ltd. (Japan) 1,070,00 48,79 1,070,000 38,132
BCE Inc. (Canada) (1) 575,00 30,81 575,000 17,069
BUILDING MATERIALS & COMPONENTS - 1.22%/1.27%
Cemex, SA de CV, (ADR) (Mexico) 1,472,61 41,04 1,472,613 36,171
Holderbank Financiere Glaris Ltd. (Switzerland) 10,00 13,69 10,000 12,526
FOOD & HOUSEHOLD PRODUCTS - 0.80%/1.21%
Nestle SA (Switzerland) 9,75 17,86 9,752 17,541
Cadbury Schweppes PLC (United Kingdom) 703,25 4,22 2,000,000 12,612
Reckitt Benckiser (formerly Reckitt & Coleman 876,37 8,22 876,375 10,532
PLC )(United Kingdom)
Groupe Danone (France) 25,00 5,88 25,000 5,798
FOREST PRODUCTS & PAPER - 0.94%/0.93%
UPM-Kymmene Corp. (Finland) 945,00 38,02 945,000 31,594
Kimberly-Clark de Mexico, SA de CV (Mexico) 1,100,00 4,27 1,100,000 4,130
IT CONSULTING & SERVICES - 1.10%/0.92%
Check Point Software Technologies Ltd. 250,00 49,68 250,000 35,406
(Israel) (1)
METALS: STEEL - 0.60%/0.81%
Kawasaki Steel Corp. (Japan) 15,125,00 27,08 15,125,000 31,268
BEVERAGES & TOBACCO - 0.71%/0.79%
South African Breweries PLC (United Kingdom) (1) 2,833,37 28,87 2,833,372 26,602
Panamerican Beverages, Inc., Class A 72,60 1,49 72,600 1,361
(Multinational-Incorporated in Panama)
Coca-Cola Amatil Ltd. (Australia) 91,60 25 408,415 1,282
Coca-Cola Beverages PLC (United Kingdom) (1) 635,93 1,21 635,937 1,249
UTILITIES: ELECTRIC & GAS - 0.63%/0.77%
Cia. Energetica de Minas Gerais - CEMIG, 826,60 18,49 826,600 15,499
preferred nominative (ADR) (Brazil)
Cia. Energetica de Minas Gerais - CEMIG, 114,074,04 1,55 131,519,048 1,574
ordinary nominative
Manilla Electric Co., Class A (GDR) 510,00 6,04 510,000 5,596
(Philippines) (2) (3)
Cia. Paranaense de Energia - COPEL, 69,62 64 480,373 3,693
Class B, preferred nominative (ADR) (Brazil)
Cia. Paranaense de Energia - COPEL, -- -- 328,207,800 1,608
ordinary nominative
Scottish Power PLC (United Kingdom) 200,00 1,47 200,000 1,772
MACHINERY & ENGINEERING - 0.70%/0.76%
GKN PLC (United Kingdom) 621,80 10,18 621,808 9,748
Metso Oyj (formerly Valmet Oy) (Finland) (1) 830,00 10,77 830,000 8,985
Mitsubishi Heavy Industries, Ltd. (Japan) 2,500,00 8,34 2,500,000 8,146
Kvaerner ASA, Class A (Norway) (1) 112,00 2,35 112,000 2,112
CONSTRUCTION & HOUSING - 0.47%/0.55%
YTL Corp. Bhd. (Malaysia) 12,000,00 19,10 10,000,000 16,316
YTL Corp. Bhd., Class A (1) -- -- 2,000,000 3,079
YTL Corp. Bhd., warrants, expire 2009 (1) 3,000,00 2,01 3,000,000 1,682
INSURANCE - 0.48%/0.50%
Royal & Sun Alliance Insurance Group PLC 1,624,00 11,74 1,624,006 10,071
(United Kingdom)
ING Groep NV (Netherlands) 100,00 6,03 100,000 5,624
AEGON NV (Netherlands) 40,00 3,85 40,000 3,625
GOLD MINES - 0.32%/0.37%
Anglogold Ltd. (South Africa) 275,00 14,17 275,000 14,023
LEISURE & TOURISM - 0.33%/0.35%
Granada Group PLC (United Kingdom) 1,100,00 11,10 1,100,000 9,500
Mandarin Oriental International Ltd. (Singapore) 5,196,21 3,63 5,742,218 4,048
INDUSTRIAL COMPONENTS - 0.19%/0.22%
Bridgestone Corp. (Japan) 175,00 3,85 175,000 4,341
Valeo (France) 50,00 3,85 50,000 3,348
Minebea Co., Ltd. (Japan) 60,00 1,02 60,000 941
REAL ESTATE - 0.17%/0.18%
Cheung Kong (Holdings) Ltd. (Hong Kong) 500,00 6,35 500,000 5,617
Mitsui Fudosan Co., Ltd. (Japan) 159,00 1,07 159,000 1,273
TRANSPORTATION: SHIPPING - 0.13%/0.13%
Stolt-Nielsen SA, Class B (ADR) (Multinational) 327,00 5,72 327,000 4,864
METALS: NONFERROUS - 0.10%/0.10%
Pechiney, Class A (France) 65,00 4,63 65,000 3,767
MISCELLANEOUS - 0.97%/0.04%
Other equity stocks in initial period 43,486 1,620
of acquisition
---------- ----------
TOTAL STOCKS (cost: $2,020,509,000 4,223,280 3,615,629
and $2,032,783,000 respectively)
---------- ----------
Principal Principal
Amount Amount
Convertible Debentures (000) (000)
-------------------------------------------- -------- --------
BROADCASTING & PUBLISHING - 0.19%/0.22%
United News & Media PLC 6.125% 2003 #4,500 8,44 #4,500 8,311
ELECTRONIC COMPONENTS - 0.15%/0.12%
Acer Peripherals Inc. 1.25% 2006 (2) $2,000 6,70 $2,000 4,700
DIVERSIFIED TELECOMMUNICATION SERVICES
- 0.13%/0.11%
COLT Telecom Group PLC 2.00% 2006 EURO2,400 5,85 EURO2,400 4,260
ENERGY SOURCES - 0.00%/0.03%
Zhenhai Refining Chemical Co. Ltd. 3.00% -- -- $950 978
2003 (2)
ELECTRICAL & ELECTRONIC - 0.02%/0.00%
Elektrim SA 3.75% 2004 $1,000 86 -- --
---------- ----------
TOTAL CONVERTIBLE DEBENTURES (cost: 21,866 18,249
$14,279,000 and $14,380,000 respectively)
---------- ----------
TOTAL EQUITY SECURITIES (cost: 4,245,146 3,633,878
$2,034,788,000 and $2,047,163,000 respectively)
---------- ----------
Short-Term Securities
--------------------------------------------
CORPORATE SHORT-TERM NOTES - 5.67%/4.64%
Reed Elsevier Inc. 5.87%-6.00% due 1/24/2000 (2) 31,00 30,87 31,000 30,723
Arco British Ltd. 5.35%-5.70% due -- -- 24,700 24,680
12/2-12/7/1999 (2)
Asset Securitization Corp. 5.85%-5.93% 22,90 22,73 22,900 22,614
due 2/8-2/23/2000 (2)
Xerox Capital (Europe) PLC 5.30%-5.70% -- -- 22,150 22,123
due 12/1-12/16/1999
Lloyds TSB Group PLC 5.36%-5.90% due 10,00 9,96 20,000 19,881
12/20/1999-1/24/2000
Spintab AB 5.85%-5.975% 2/17-4/17/2000 24,50 24,25 19,500 19,245
Diageo Capital PLC 5.95% due 1/18-1/19/2000 (2) 15,67 15,62 15,670 15,544
Telstra Corp. Ltd. 5.40%-5.95% due 6,48 6,37 13,392 13,366
12/13/1999-4/17/2000
ANZ (Delaware) Inc. 5.32% due 12/7/1999 -- -- 10,000 9,990
KfW International Finance Inc. 5.92%-6.05% 34,50 34,251
due 2/3-3/28/2000
Glaxo Wellcome PLC 6.00% due 2/2-2/4/2000 (2) 30,00 29,833
DaimlerChrysler AG 5.95% due 2/4/2000 15,50 15,410
Toyota Motor Credit Corp. 6.00% due 1/10/2000 13,80 13,777
UBS Finance (Delaware) Inc. 4.25% due 1/3/2000 13,40 13,395
American Honda Finance Corp. 6.02% 10,00 9,931
due 2/10/2000
Sara Lee Corp 5.87% due 1/6/2000 9,30 9,291
Toronto-Dominion Holdings Inc. 5.90% 9,00 8,949
due 2/4/2000
Anheuser-Busch Companies, Inc. 6.05% 5,80 5,759
due 2/11/2000
BMW US Capital Corp. 4.00% due 1/4/2000 3,00 2,999
National Rural Utilities Cooperative Finance Corp. 1,80 1,781
5.98% due 3/7/2000
FEDERAL AGENCY DISCOUNT NOTES - 0.00%/0.45%
Freddie Mac 5.27%-5.41% due 12/17-12/30/1999 -- -- 17,304 17,247
NON U.S. CURRENCY - 0.05%/0.06%
New Taiwanese Dollar NT$74,768 2,38 NT$74,090 2,345
---------- ----------
TOTAL SHORT-TERM SECURITIES (cost: 257,580 197,758
$257,375,000 and $197,573,000 respectively)
---------- ----------
TOTAL INVESTMENT SECURITIES (cost: 4,502,726 3,831,636
$2,292,163,000 and $2,244,736,000 respectively)
Net cash, receivables and payables 1,209 5,644
---------- ----------
NET ASSETS $4,503,935 $3,837,280
========== ==========
(1) Non-income-producing security.
(2) Purchased in a private placement transaction;
resale to the public may require registration
or sale only to qualified institutional buyers.
(3) Valued under procedures established by
the Board of Trustees.
ADR = American Depositary Receipts
FDR = Fiduciary Depositary Receipts
GDR = Global Depositary Receipts
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series New World Fund
Investment Portfolio, December 31 and November 30, 1999
<S> <C> <C> <C> <C>
Dec. 31, 1999 Nov. 30, 1999
Where the Fund's Assets Are Invested
Asia/Pacific 26.88% 27.94%
The Americas 27.11 27.56
Europe 16.57 18.46
Other Countries 6.08 6.58
Cash & Equivalent 23.36 19.46
Largest Individual Equity Securities
Dec. 31, 1999 Nov. 30, 1999
Samsung Electro-Mechanics 2.87 Samsung Electro- 4.30
Check Point Software Technologies 2.10 Mechanics
Telefonos de Mexico 2.06 Telefonos de Mexico 2.18
DBS Group Holdings 1.92 ABN AMRO Holding 2.16
Hon Hai Precision Industry 1.89 DBS Group Holdings 1.95
Migros Turk 1.82 Fuji Photo Film 1.95
ABN AMRO Holding 1.73 Check Point Softwar 1.91
Magyar Tavkozlesi 1.56 Technologies
Tele Sudeste Celular Participacoes 1.49 Avon Products 1.90
Unibanco-Uniao de Bancos Brasileiros 1.46 Hon Hai Precision 1.77
Industry
Carrefour 1.69
Magyar Tavkozlesi 1.67
Dec. 31, 1999 Nov. 30, 1999
Market Market
Number of Value Number of Value
EQUITY SECURITIES (common and preferred stocks) Shares (000) Shares (000)
-------------------------------------------- -------- -------- -------- --------
DIVERSIFIED TELECOMMUNICATION SERVICES
- 11.26%/10.82%
Telefonos de Mexico, SA de CV, Class L 15,30 1,7 15,300 1,416
(ADR) (Mexico)
Magyar Tavkozlesi Rt. (ADR) (Hungary) 36,10 1,3 36,100 1,090
Korea Telecom Corp. (ADR) (South Korea) 14,00 1,0 14,000 742
Nortel Inversora SA, preferred, Class B 38,00 7 38,000 712
(ADR) (Argentina)
Philippine Long Distance Telephone Co. (Philippines) 30,80 7 30,800 633
Global TeleSystems Group, Inc. (USA) (1) 18,10 6 18,100 578
Compania Anonima Nacional Telefonos 23,00 5 23,000 551
de Venezuela (CANTV), Class D (ADR) (Venezuela)
Videsh Sanchar Nigam Ltd. (GDR) (India) 22,00 5 22,000 506
Mahanagar Telephone Nigam Ltd. (GDR) (India) 52,00 5 52,000 461
Telecom Argentina STET-France Telecom SA, 12,00 4 12,000 353
Class B (ADR) (Argentina)
Telefonica de Argentina SA, Class B (Argentina) 175,00 5 -- --
Telefonica de Argentina SA, Class B (ADR) 17,00 5 -- --
ELECTRONIC COMPONENTS - 6.77%/8.18%
Samsung Electro-Mechanics Co. (South Korea) (1) 36,00 2,3 36,000 2,796
Hon Hai Precision Industry Co. Ltd. (Taiwan) (1) 211,00 1,5 161,000 1,151
Samsung Electronics Co., Ltd. (South Korea) 4,90 1,1 4,400 911
Venture Manufacturing (Singapore) Ltd (Singapore) 46,00 5 46,000 466
BANKING - 9.17%/7.06%
ABN AMRO Holding NV (Netherlands) 57,70 1,4 57,703 1,404
DBS Group Holdings Ltd. (Singapore) 97,69 1,6 97,692 1,268
Yapi ve Kredi Bankasi AS (Turkey) 38,317,00 1,1 38,317,000 703
Unibanco-Uniao de Bancos Brasileiros SA, 40,40 1,2 29,400 693
units (GDR) (Brazil)
Wielkopolski Bank Kredytowy SA (Poland) 48,00 3 48,000 268
Bangkok Bank PCL (Thailand) (1) 120,00 3 120,000 257
Kookmin Bank (South Korea) 40,00 6 -- --
Shinhan Bank (South Korea) 45,00 4 -- --
Standard Chartered PLC (United Kingdom) 30,00 4 -- --
HEALTH & PERSONAL CARE - 3.81%/5.04%
Avon Products, Inc. (USA) 34,00 1,1 34,000 1,239
AstraZeneca PLC (United Kingdom) 19,10 8 19,100 854
PLIVA d.d. (GDR) (Croatia) 50,00 6 50,000 607
Kimberly-Clark Corp. (USA) 9,10 5 9,100 581
ELECTRICAL & ELECTRONICS - 3.89%/3.98%
ECI Telecom Ltd. (Israel) 33,00 1,0 33,000 827
Telefonaktiebolaget LM Ericsson, Class B (Sweden) 13,20 8 13,200 640
Trigem Computer Inc. (South Korea) 6,40 7 6,400 635
Elektrim SA (Poland) (1) 65,00 6 65,000 486
MULTI-INDUSTRY - 3.03%/3.27%
Orkla AS, Class A (Norway) 41,14 7 41,142 633
Anglo American PLC (United Kingdom) 10,00 6 10,000 586
First Pacific Co. Ltd. (Hong Kong) 1,039,00 8 1,039,000 562
Benpres Holdings Corp. (Philippines) (1) 2,435,00 3 2,435,000 345
MERCHANDISING - 1.82%/3.17%
Carrefour SA (France) -- -- 6,300 1,098
Migros Turk TAS (Turkey) 2,355,00 1,5 2,355,000 966
WIRELESS TELECOMMUNICATION SERVICES
- 3.23%/2.83%
China Telecom (Hong Kong) Ltd. (People's Republic 120,00 7 120,000 644
of China) (1)
Tele Sudeste Celular Participacoes SA, 30,00 1,1 30,000 617
preferred nominative (ADR) (Brazil)
Telesp Celular SA, preferred nominative, 8,869,00 7 8,869,000 430
Class B (Brazil)
Partner Communications Co. Ltd. (ADR) (Israel) (1) -- -- 8,200 154
Tele Sudeste Celular Participacoes SA (Brazil) 18,898,00 -- --
BROADCASTING & PUBLISHING - 2.67%/2.80%
Matav-Cable Systems Media Ltd. (Israel) 23,00 6 23,000 571
MIH Holdings Ltd., Class A (South Africa) (1) 10,00 5 10,000 538
Grupo Televisa, SA, ordinary participation 9,60 6 9,600 469
certificates (ADR) (Mexico) (1)
Antenna TV SA (ADR) (Greece) (1) 18,70 3 18,700 245
BEVERAGES & TOBACCO - 2.14%/2.70%
Fomento Economico Mexicano, SA de CV (ADR) (Mexico) 15,30 6 15,300 580
Coca-Cola Amatil Ltd. (Australia) 170,87 4 170,878 536
South African Breweries PLC (United Kingdom) (1) 40,00 4 40,000 376
Coca-Cola Co. (USA) 4,00 2 4,000 269
METALS: NONFERROUS - 2.57%/2.66%
Alcoa Inc. (USA) 13,00 1,0 13,000 851
Freeport-McMoRan Copper & Gold Inc., Class B (USA) (1 31,00 6 31,000 490
KGHM Polska Miedz SA (GDR) (Poland) 30,00 4 30,000 389
AUTOMOBILES - 1.86%/2.49%
Suzuki Motor Corp. (Japan) 68,00 9 68,000 1,004
Honda Motor Co., Ltd. (Japan) 15,00 5 15,000 620
RECREATION & OTHER CONSUMER PRODUCTS
- 1.36%/1.95%
Fuji Photo Film Co., Ltd. (Japan) 31,00 1,1 31,000 1,267
IT CONSULTING & SERVICES - 2.10%/1.91%
Check Point Software Technologies Ltd. (Israel) (1) 8,80 1,7 8,800 1,246
FOOD & HOUSEHOLD PRODUCTS - 1.50%/1.78%
Colgate-Palmolive Co. (USA) 7,80 5 7,800 428
Sara Lee Corp. (USA) 16,00 3 16,000 388
PT Indofood Sukses Makmur Tbk (Indonesia) (1) 309,00 3 309,000 340
BUSINESS SERVICES - 1.55%/1.54%
Sabre Group Holdings, Inc., Class A (USA) 7,50 3 7,500 341
Terra Networks, SA (Spain)(1) 8,60 4 8,600 296
Korea Thrunet Co. Ltd., Class A (South Korea)(1) 4,27 2 4,270 238
Seminis, Inc., Class A (USA)(1) 23,50 1 23,500 129
MISCELLANEOUS MATERIALS & COMMODITIES
- 1.22%/1.45%
De Beers Consolidated Mines Ltd. (South Africa) 35,00 1,0 35,000 946
REAL ESTATE - 0.87%/1.02%
SM Prime Holdings, Inc. (Philippines) 1,800,00 3 1,800,000 286
Ayala Land, Inc. (Philippines) 1,162,00 3 1,162,000 276
New World China Land Ltd. (People's Republic 225,00 225,000 100
of China - Incorporated in the Cayman Islands) (1)
APPLIANCES & HOUSEHOLD DURABLES - 1.24%/1.00%
Sony Corp. (Japan) 3,50 1,0 3,500 651
ENERGY SOURCES - 0.87%/0.97%
Broken Hill Proprietary Co. Ltd. (Australia) 35,55 4 35,558 390
MOL Magyar Olaj- es Gazipari Rt. (Hungary) 12,50 2 12,500 242
TRANSPORTATION: AIRLINES - 0.66%/0.77%
AMR Corp. (USA) (1) 8,20 5 8,200 499
WHOLESALE & INTERNATIONAL TRADE - 1.66%/0.58%
Li & Fung Ltd. (Hong Kong - Incorporated in Bermuda) 164,00 4 164,000 377
Marubeni Corp (Japan) 231,00 9 -- --
FOREST PRODUCTS & PAPER - 0.47%/0.58%
Kimberly-Clark de Mexico, SA de CV, Class A (Mexico) 100,00 3 100,000 375
MISCELLANEOUS - 1.80%/1.24%
Other equity securities in initial period 1,509 807
of acquisition
---------- ----------
TOTAL EQUITY SECURITIES (cost: $45,681,000 56,322 45,423
and $42,175,000, respectively)
---------- ----------
Principal Principal
Amount Amount
BONDS & NOTES (000) (000)
-------------------------------------------- -------- --------
BROADCASTING, ADVERTISING & PUBLISHING
- 0.27%/0.34%
Grupo Televisa, SA 0%/13.25% 2008 (2) 25 2 $ 250 223
MULTI-INDUSTRY - 0.27%/0.33%
Reliance Industries Ltd. 10.25% 2097 (3) 25 2 250 215
WIRELESS TELECOMMUNICATION SERVICES
- 0.31%/0.00%
Cellco Finance NV 12.75% 2005 25 260
NON U.S. GOVERNMENT OBLIGATIONS
- 8.27%/10.07%
Brazil (Federal Republic of):
Bearer 8.00% 2014 (4) 2,69 2,0 2,693 1,845
Global 10.125% 2027 1,00 8 1,000 800
United Mexican States Government Eurobonds, Global:
11.50% 2026 30 3 300 349
11.375% 2016 48 5 250 275
10.375% 2009 -- -- 250 259
Argentina (Republic of) 11.75% 2009 65 6 650 629
Panama (Republic of), Past Due Interest 71 5 718 536
Eurobond 6.50% 2016 (5)
Turkey (Republic of) 12.375% 2009 50 5 500 523
Philippines (Republic of) 9.875% 2019 50 4 500 510
Poland (Republic of), Past Due Interest Bond, 37 3 375 330
Bearer 5.00% 2014 (5)
Croatian Government:
Series A, 6.456% 2010 (5) 24 2 240 205
Series B, 6.456% 2006 (5) 7 78 69
Venezuela (Republic of), Global 9.25% 2027 35 2 350 224
---------- ----------
TOTAL BONDS & NOTES (cost: 7,603 6,992
$7,074,000 and $6,795,000, respectively)
---------- ----------
SHORT-TERM SECURITIES
--------------------------------------------
CORPORATE SHORT-TERM NOTES - 14.64%/17.75%
Paccar Financial Corp. 5.47% due 12/21/1999 -- -- 1,200 1,196
CIT Group Holdings, Inc. 5.95% due 1/4/2000 1,09 1,0 1,096 1,090
Arco British Ltd. 5.36% due 12/2/1999 (3) -- -- 1,000 1,000
Corporate Asset Funding Co. Inc. 5.45% -- -- 1,000 1,000
due 12/2/1999 (3)
Bestfoods 5.30% due 12/21/1999 (3) -- -- 1,000 997
British Telecommunications PLC 5.83% due 1/19/2000 1,00 9 1,000 992
Export Development Corp. 5.80% due 1/18/2000 1,00 9 1,000 992
Spintab AB 5.92% due 1/24/2000 1,00 9 1,000 991
Sony Capital Corp. 5.30% due 12/6/1999 (3) -- -- 900 899
Vodafone Airtouch PLC 5.50% due 12/13/1999 (3) -- -- 900 898
Xerox Capital (Europe) PLC 5.30% due 12/14/1999 -- -- 800 798
DaimlerChrysler NA Holdings 5.47% due 12/10/1999 -- -- 700 699
Sara Lee Corp. 5.10% due 1/28/2000 1,30 1,2 -- --
Motiva Enterprises LLC 5.85% due 1/10/2000 1,20 1,1 -- --
Coca-Cola Co. 5.88% due 1/1/4/2000 1,10 1,0 -- --
France Telecom, SA,6.00% due 2/2/2000 (3) 1,10 1,0 -- --
Associate First Capital Corp. 4.00% due 1/3/2000 1,00 1,0 -- --
Avon Capital Corp. 6.70% due 1/6/2000(3) 1,00 9 -- --
Sony Europe Finance PLC 6.15% due 1/10/2000 (3) 94 9 -- --
BMW US Capital Corp. 6.55% due 1/12/2000 50 4 -- --
FEDERAL AGENCY DISCOUNT NOTES - 7.99%/4.52%
Fannie Mae 5.21%-5.48% due 12/2/1999-2/17/2000 2,40 2,3 1,840 1,838
Freddie Mac 5.26%-5.61% due 12/8/1999-1/27/2000 2,50 2,4 1,103 1,101
International Bank for Reconstruction 1,80 1,7 -- --
and Development 5.80% due 1/13/2000
NON-U.S. CURRENCY - 0.03%/0.03%
New Taiwanese Dollar NT$635 NT$635 20
---------- ----------
TOTAL SHORT-TERM SECURITIES (cost: 18,898 14,511
$18,898,000 and $14,511,000, respectively)
---------- ----------
TOTAL INVESTMENT SECURITIES (cost: 82,823 66,926
$71,653,000 and $63,481,000, respectively)
Net cash, receivables and payables 592 (1,843)
---------- ----------
NET ASSETS 83,415 65,083
========== ==========
(1) Non-income-producing security.
(2) Step bond; coupon rate will increase
at a later date.
(3) Purchased in a private placement transaction;
resale to the public may require registration
or sale only to qualified institutional buyers.
(4) Payment in kind; the issuer has the option of
paying additional securities in lieu of cash.
(5) Coupon rate may change periodically.
ADR = American Depositary Receipts
GDR = Global Depositary Receipts
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series Growth
Income Fund Investment Portfolio,
December 31, 1999 and November 30, 1999
<S> <C> <C> <C> <C>
Dec 31, 1999 Nov 30, 1999
EQUITY SECURITIES 87.45% 87.43%
CASH &
EQUIVALENTS 12.55% 12.57%
Percent
Of Net
Largest Individual Equity Securities Assets
-------------------------------------------- ---------
U S WEST Communications 1.80%
Microsoft 1.75
Computer Associates International 1.72
Texas Instruments 1.70
Viacom 1.60
Albertson's 1.53
Wells Fargo 1.24
Household International 1.22
Citizens Utilities 1.14
Allied Waste Industries 1.06
Percent
Of Net
Largest Individual Stocks Assets
-------------------------------------------- ---------
Texas Instruments 1.73%
Computer Associates International 1.64
U S WEST Communications 1.59
Wells Fargo 1.52
Microsoft 1.40
Viacom 1.40
Monsanto 1.37
Albertson's 1.34
Household International 1.33
Bristol-Myers Squibb 1.19
Market Market
Number of Value Number of Value
Stocks (common and preferred) Shares (000) Shares (000)
-------------------------------------------- -------- -------- -------- --------
DATA PROCESSING & REPRODUCTION - 9.68% / 9.13%
Computer Associates International, Inc. 1,925,00 $ 134,63 1,925,000 $ 125,125
Microsoft Corp. (1) 1,175,00 137,18 1,175,000 106,980
Storage Technology Corp. (1) 4,150,00 76,51 4,150,000 81,963
Xerox Corp. 2,950,00 66,92 2,850,000 77,128
3Com Corp. (1) 1,500,00 70,50 1,500,000 59,719
Lexmark International Group, Inc., Class A (1) 575,00 52,03 575,000 47,725
Gateway, Inc. (formerly Gateway 2000, Inc.) (1) 475,70 34,28 550,000 42,006
Cisco Systems, Inc. (1) 400,00 42,85 400,000 35,675
Oracle Corp. (1) 350,00 39,22 400,000 27,125
Compaq Computer Corp. 900,00 24,35 900,000 21,994
International Business Machines Corp. 210,00 22,68 210,000 21,643
Autodesk, Inc. 700,00 23,62 700,000 20,519
Silicon Graphics, Inc. (1) 1,724,30 16,92 1,724,300 16,273
Hewlett-Packard Co. 150,00 17,09 150,000 14,231
HEALTH & PERSONAL CARE - 6.88% / 7.67%
Bristol-Myers Squibb Co. 1,243,30 79,80 1,243,300 90,839
Guidant Corp. (1) 1,500,00 70,50 1,392,200 69,610
Kimberly-Clark Corp. 1,040,00 67,86 1,040,000 66,430
Avon Products, Inc. 1,700,00 56,10 1,700,000 61,944
AstraZeneca PLC (ADR) (United Kingdom) 1,156,75 48,29 1,311,700 58,371
Warner-Lambert Co. 650,00 53,25 650,000 58,297
Merck & Co., Inc. 500,00 33,53 500,000 39,250
Glaxo Wellcome PLC (ADR) (United Kingdom) 600,00 33,52 600,000 35,662
Schering-Plough Corp. 530,00 22,35 530,000 27,096
Cardinal Health, Inc. 500,00 23,93 500,000 26,156
Eli Lilly and Co. 225,00 14,96 225,000 16,144
Bergen Brunswig Corp., Class A 1,800,00 14,96 1,800,000 14,850
Pfizer Inc 400,00 12,97 400,000 14,475
McKesson Corp. 300,00 6,76 300,000 7,012
ENERGY SOURCES - 5.50% / 6.10%
Ultramar Diamond Shamrock Corp. 2,260,10 51,27 2,279,100 57,690
Conoco Inc., Class A 1,674,00 41,43 1,674,000 44,047
Conoco Inc., Class B 491,36 12,22 491,369 12,868
Texaco Inc. 800,00 43,45 800,000 48,750
Phillips Petroleum Co. 950,00 44,65 950,000 45,422
Kerr-McGee Corp. 675,00 41,85 725,000 41,506
Petro-Canada (Canada) 2,800,00 39,59 2,800,000 39,137
Valero Energy Corp. 1,700,00 33,78 1,700,000 35,275
Atlantic Richfield Co. 275,00 23,78 325,000 31,322
Noble Affiliates, Inc. 980,00 21,00 980,000 21,560
USX-Marathon Group 750,00 18,51 750,000 19,828
Sunoco, Inc. 750,00 17,62 750,000 19,172
Murphy Oil Corp. 300,00 17,21 300,000 16,950
Chevron Corp. 185,00 16,02 185,000 16,384
Ashland Inc. 250,00 8,23 250,000 8,437
BP Amoco PLC (ADR) (United Kingdom) 132,332 8,064
BANKING - 5.45% / 6.04%
Wells Fargo & Co. 2,397,00 96,92 2,497,000 116,111
Bank of America Corp. 1,100,00 55,20 1,100,000 64,350
BANK ONE CORP. 1,333,01 42,74 1,083,012 38,176
First Union Corp. 1,472,80 48,32 972,800 37,635
Bank of New York Co., Inc. 800,00 32,00 800,000 31,900
Chase Manhattan Corp. 400,00 31,07 400,000 30,900
KeyCorp 800,00 17,70 800,000 21,600
Citigroup Inc. 381,90 21,21 381,900 20,575
J.P. Morgan & Co. Inc. 150,00 18,99 150,000 19,725
SunTrust Banks, Inc. 280,00 19,26 280,000 19,565
Sakura Bank, Ltd. (ADR) (Japan) 200,00 11,35 200,000 14,838
Huntington Bancshares Inc. 505,64 12,07 505,646 14,000
Fleet Boston Corp. 350,00 12,18 350,000 13,234
Washington Mutual, Inc. (formerly Washington - - 358,700 10,402
Mutual Savings Bank)
Bank of Tokyo-Mitsubishi, Ltd. (ADR) (Japan) 600,00 8,36 600,000 8,850
BROADCASTING & PUBLISHING - 6.05% / 5.71%
Viacom Inc., Class B (1) 2,075,00 125,40 2,150,000 106,962
News Corp. Ltd. (ADR) (Australia) 1,100,00 42,07 1,100,000 37,675
News Corp. Ltd., preferred (ADR) 900,00 30,09 900,000 27,844
MediaOne Group, Inc. (1) 615,00 47,24 615,000 48,739
Harte-Hanks Communications, Inc. 2,066,10 44,93 1,832,400 37,908
AT&T Corp. Liberty Media Group, Class A (1) 500,00 28,37 900,000 37,631
Media General, Inc., Class A 755,10 39,26 636,100 32,441
Time Warner Inc. 505,40 36,61 507,000 31,276
Gannett Co., Inc. 350,00 28,54 385,400 27,580
Knight-Ridder, Inc. 400,00 23,80 400,000 21,825
Fox Entertainment Group, Inc., Class A (1) 700,00 17,45 700,000 16,100
E.W. Scripps Co., Class A 226,00 10,12 226,000 10,509
DIVERSIFIED TELECOMMUNICATION SERVICES
- 4.64% / 4.89%
U S WEST Communications, Inc. 1,960,00 141,12 1,960,000 121,642
Citizens Utilities Co., Series B (1) 6,300,00 89,38 6,300,000 77,962
GTE Corp. 700,00 49,39 755,000 55,115
SBC Communications Inc. 726,40 35,41 726,400 37,727
AT&T Corp. 600,00 30,45 600,000 33,525
MCI WorldCom, Inc. (1) - - 350,000 28,941
Focal Communications Corp. (1) 430,00 10,37 430,000 10,159
Qwest Communications International Inc. (1) 170,00 7,31 170,000 5,812
Time Warner Telecom Inc., Class A (1) - - 110,100 3,200
CHEMICALS - 3.96% / 4.32%
Monsanto Co. 2,177,90 77,58 2,475,000 104,414
Mallinckrodt Inc. 1,800,00 57,26 1,800,000 59,850
Millennium Chemicals Inc. 2,741,60 54,14 2,741,600 53,632
International Flavors & Fragrances Inc. 1,100,00 41,52 1,100,000 40,494
Praxair, Inc. 600,00 30,18 600,000 26,775
PPG Industries, Inc. 450,00 28,15 450,000 26,353
E.I. du Pont de Nemours and Co. 130,00 8,56 130,000 7,727
Air Products and Chemicals, Inc. 200,00 6,71 200,000 6,475
CK Witco Corp. (formerly Witco Corp.) 462,10 6,18 462,100 4,939
MERCHANDISING - 4.40% / 3.95%
Albertson's, Inc. 3,714,50 119,79 3,213,950 102,645
J.C. Penney Co., Inc. 1,650,00 32,89 1,650,000 36,816
AutoZone, Inc. (1) 1,300,00 42,00 1,300,000 35,831
Limited Inc. 750,00 32,48 750,000 31,828
Lowe's Companies, Inc. 847,40 50,63 550,000 27,397
Federated Department Stores, Inc. (1) 500,00 25,28 500,000 23,531
Too, Inc. (1) 910,00 15,69 910,000 16,835
Circuit City Stores, Inc. - Circuit City Group 300,00 13,51 300,000 14,550
Gap, Inc. 125,00 5,75 125,000 5,063
Dollar General Corp. 173,90 3,95 173,900 4,261
Circuit City Stores, Inc. - CarMax Group (1) 1,300,00 3,00 1,300,000 3,087
ELECTRONIC COMPONENTS - 3.49% / 3.58%
Texas Instruments Inc. 1,375,00 133,20 1,375,000 132,086
Corning Inc. 500,00 64,46 679,500 63,661
Intel Corp. 400,00 32,92 530,000 40,644
SCI Systems, Inc. (1) 413,30 33,96 413,300 28,053
Quantum Corp. - DLT & Storage Systems 600,00 9,07 600,000 9,450
(formerly Quantum Corp.) (1)
BUSINESS SERVICES - 3.57% / 3.55%
Allied Waste Industries, Inc. (1) 9,425,00 83,05 8,456,400 68,708
Cendant Corp. (1) 2,050,00 54,45 2,579,899 42,730
IKON Office Solutions, Inc. 4,050,00 27,59 4,050,000 27,084
Pitney Bowes Inc. 632,20 30,54 535,800 25,685
Waste Management, Inc. 1,490,00 25,60 1,490,000 24,212
Alexander & Baldwin, Inc. 1,020,00 23,26 1,020,000 23,205
ServiceMaster Co. 1,600,00 19,70 1,553,300 19,902
Equifax Inc. 500,00 11,78 500,000 12,375
Young & Rubicam Inc. - - 225,000 11,742
Hertz Corp., Class A - - 205,400 8,691
Manpower Inc. 100,00 3,76 200,000 7,288
FOREST PRODUCTS & PAPER - 2.96% / 2.88%
Bowater Inc. 1,395,00 75,76 1,395,000 68,355
Fort James Corp. 1,669,49 45,70 1,669,499 47,998
Weyerhaeuser Co. 600,00 43,08 650,000 39,813
International Paper Co. 700,00 39,50 700,000 36,531
Sonoco Products Co. 800,00 18,20 800,000 18,400
Westvaco Corp. 187,50 6,11 187,500 5,660
Georgia-Pacific Corp., Timber Group 150,00 3,69 150,000 3,722
FINANCIAL SERVICES - 2.30% / 2.40%
Household International, Inc. 2,563,32 95,48 2,563,320 101,411
Capital One Financial Corp. 630,00 30,35 630,000 29,334
Providian Financial Corp. 250,00 22,76 250,000 19,781
MBNA Corp. 470,00 12,80 470,000 11,868
FINOVA Group Inc. 310,00 11,00 310,000 11,528
Associates First Capital Corp., Class A 277,46 7,61 277,464 9,226
UTILITIES: ELECTRIC & GAS - 2.19% / 2.26%
Ameren Corp. 1,145,40 37,51 1,145,400 39,659
DPL Inc. 1,600,00 27,70 1,600,000 28,600
GPU, Inc. 850,00 25,44 850,000 27,200
TECO Energy, Inc. 1,300,00 24,13 1,300,000 26,000
Consolidated Natural Gas Co. 350,00 22,72 350,000 22,444
Duke Energy Corp. 500,00 25,06 405,700 20,564
American Electric Power Co., Inc. 275,00 8,83 275,000 8,628
FOOD & HOUSEHOLD PRODUCTS - 2.06% / 2.21%
Sara Lee Corp. 3,100,00 68,39 3,100,000 75,175
Campbell Soup Co. 800,00 30,95 800,000 35,700
General Mills, Inc. 820,00 29,31 820,000 30,904
Colgate-Palmolive Co. 500,00 32,50 500,000 27,437
MACHINERY & ENGINEERING - 2.20% / 2.12%
Millipore Corp. 1,354,20 52,30 1,354,200 44,434
Deere & Co. 850,00 36,86 850,000 36,497
Ingersoll-Rand Co. 525,00 28,90 525,000 25,430
New Holland NV (Netherlands) 1,700,00 22,63 1,700,000 23,269
Pall Corp. 700,00 15,09 700,000 16,406
Caterpillar Inc. 350,00 16,47 350,000 16,231
INSURANCE - 1.99% / 1.85%
Allstate Corp. 1,800,00 43,20 1,800,000 47,137
MGIC Investment Corp. 400,00 24,07 422,400 23,866
American General Corp. 320,00 24,28 320,000 23,460
Aetna Inc. 406,40 22,68 406,400 22,200
Royal & Sun Alliance Insurance Group PLC 2,500,00 18,07 2,500,000 15,503
(United Kingdom)
Hartford Financial Services Group, Inc. 500,00 23,68 202,300 9,445
ELECTRONIC INSTRUMENTS - 2.05% / 1.82%
Applied Materials, Inc. (1) 600,00 76,01 800,000 77,950
PE Corp.-PE Biosystems Group 600,00 72,18 600,000 48,975
L-3 Communications Corp. (1) 300,00 12,48 300,000 12,375
BEVERAGES & TOBACCO - 1.63% / 1.81%
Philip Morris Companies Inc. 1,590,00 36,86 1,590,000 41,837
Nabisco Group Holdings Corp. (formerly RJR 2,950,00 31,34 2,950,000 34,109
Nabisco Holdings Corp.)
PepsiCo, Inc. 820,00 28,90 820,000 28,341
UST Inc. 700,00 17,63 700,000 18,638
R.J. Reynolds Tobacco Holdings, Inc. 733,33 12,92 733,333 15,629
ELECTRICAL & ELECTRONICS - 1.59% / 1.36%
York International Corp. 1,902,90 52,21 1,902,900 42,459
Nokia Corp., Class A (ADR) (Finland) 170,00 32,30 210,000 29,019
Hitachi, Ltd. (Japan) 1,120,00 17,97 1,120,000 15,546
Harris Corp. 500,00 13,34 500,000 10,500
Telefonaktiebolaget LM Ericsson, Class B (ADR) 100,00 6,56 100,000 4,819
(Sweden)
Lanier Worldwide, Inc. (1) 500,00 1,93 500,000 2,000
TRANSPORTATION: RAIL & ROAD - 1.14% / 1.26%
Canadian National Railway Co. (Canada) 1,400,00 36,83 1,400,000 41,913
Burlington Northern Santa Fe Corp. 1,025,00 24,85 925,000 26,825
Norfolk Southern Corp. 841,00 17,24 740,000 15,818
Union Pacific Corp. 150,00 6,54 150,000 7,059
CSX Corp. 125,00 3,92 125,000 4,445
MULTI-INDUSTRY - 1.12% / 1.02%
FMC Corp. (1) 550,00 31,52 550,000 26,675
Honeywell International Inc. (formerly 500,00 28,84 400,000 23,925
AlliedSignal Inc.)
Textron Inc. 200,00 15,33 200,000 14,213
Loews Corp. 200,00 12,13 200,000 12,800
TEXTILES & APPAREL - 1.13% / 0.97%
NIKE, Inc., Class B 1,394,10 69,09 1,190,000 54,740
VF Corp. 650,00 19,50 650,000 19,419
INDUSTRIAL COMPONENTS - 0.86% / 0.93%
Eaton Corp. 440,00 31,95 440,000 34,073
Federal-Mogul Corp. 856,60 17,23 856,600 19,113
Dana Corp. 231,80 6,94 231,800 6,432
Tower Automotive, Inc. (1) 400,00 6,17 400,000 6,000
Genuine Parts Co. - - 200,000 5,150
Illinois Tool Works Inc. 75,00 5,06 - -
AEROSPACE & MILITARY TECHNOLOGY
- 0.94% / 0.91%
United Technologies Corp. 623,20 40,50 623,200 35,211
Boeing Co. 550,00 22,85 550,000 22,447
Raytheon Co., Class B 250,00 6,64 250,000 7,672
Raytheon Co., Class A 151,84 3,76 151,848 4,422
ENERGY EQUIPMENT - 0.73% / 0.81%
Schlumberger Ltd. (Netherlands Antilles) 900,00 50,62 900,000 54,056
Baker Hughes Inc. 300,00 6,31 300,000 7,575
LEISURE & TOURISM - 0.75% / 0.74%
Seagram Co. Ltd. (Canada) 1,300,00 58,41 1,300,000 56,631
RECREATION & OTHER CONSUMER PRODUCTS
- 0.59% / 0.63%
Pennzoil-Quaker State Co. 3,554,60 36,21 3,554,600 36,879
Mattel, Inc. 750,00 9,84 750,000 10,734
Water Pik Technologies, Inc. (1) - - 60,000 443
REAL ESTATE - 0.66% / 0.59%
Equity Residential Properties Trust 600,00 25,61 600,000 24,113
Boston Properties, Inc. 850,00 26,45 750,000 21,234
HEALTH CARE PROVIDERS & SERVICES
- 0.66% / 0.55%
United HealthCare Corp. 450,00 23,90 450,000 23,372
Service Corp. International 4,000,00 27,75 2,500,000 18,906
METALS: NONFERROUS - 0.53% / 0.43%
Alcoa Inc. 500,00 41,50 500,000 32,750
MISCELLANEOUS MATERIALS & COMMODITIES
- 0.42% / 0.41%
Owens-Illinois, Inc. (1) 700,00 17,54 700,000 16,756
Crown Cork & Seal Co., Inc. 700,00 15,66 700,000 14,263
IT CONSULTING & SERVICES - 0.17% / 0.34%
Electronic Data Systems Corp. 200,00 13,38 400,000 25,725
WIRELESS TELECOMMUNICATION SERVICES
- 0.28% / 0.25%
Western Wireless Corp., Class A (1) 325,00 21,69 325,000 19,033
METALS: STEEL - 0.17% / 0.20%
Allegheny Technologies, Inc. (formerly 600,00 13,46 600,000 15,113
Allegheny Teledyne Inc.)
TRANSPORTATION: AIRLINES - 0.21% / 0.00%
Southwest Airlines Co. 1,000,00 16,18 - -
MISCELLANEOUS - 4.32% / 3.58%
Other stocks in initial period of acquisition 338,310 273,567
---------- ----------
TOTAL STOCKS (cost: 5,727,660,000 and 6,837,414 6,672,622
$5,677,953,000, respectively)
---------- ----------
Principal Market Principal Market
Convertible Debentures Amount Value Amount Value
-------------------------------------------- (000) (000) (000) (000)
-------- -------- -------- --------
DIVERSIFIED TELECOMMUNICATION SERVICES
- 0.18% / 0.16%
Telefonos de Mexico, SA de CV 4.25% 2004 (Mexico) $ 11,06 14,43 $ 11,06 12,622
---------- ----------
TOTAL CONVERTIBLE DEBENTURES (cost: 14,433 12,622
$10,728,000 and $10,722,000, respectively)
---------- ----------
TOTAL EQUITY SECURITIES (cost: 6,851,847 6,685,244
$5,738,388,000 and $5,688,675,000, respectively)
---------- ----------
Short-Term Securities
--------------------------------------------
Corporate Short-Term Notes - 11.69% / 11.08%
American Express Credit Corp. 5.73%-5.90% 55,00 54,67 55,000 54,381
due 2/1-2/11/2000
Bell Atlantic Network Funding Corp. 5.25%-5.82% 25,00 24,91 50,000 49,712
due 12/22/1999-1/20/2000
Procter & Gamble Co. 5.65%-5.90% due 1/27-2/2/2000 50,00 49,76 50,000 49,517
American General Finance Corp. 5.74%-5.84% 50,00 49,67 50,000 49,426
due 1/25-2/23/2000
BellSouth Capital Funding Corp. 5.67%-5.93% 67,80 67,42 49,700 49,212
due 1/20-2/15/2000 (2)
Ford Motor Credit Co. 5.64%-5.93% due 1/11-2/10/2000 46,00 45,83 46,000 45,609
Emerson Electric Co. 5.30%-5.31% due 1/24-1/26/2000 45,00 44,81 45,000 44,594
National Rural Utilities Cooperative Finance Corp. 35,60 35,24 44,100 43,867
5.30%-5.94% due 12/6/1999-3/29/2000
E.W. Scripps Co. 5.80%-6.00% due 1/21-2/14/2000 (2) 42,00 41,73 42,000 41,529
Ciesco LP 5.30%-5.95% due 12/10/1999-2/8/2000 18,20 18,08 40,000 39,788
Eastman Kodak Co. 5.30%-5.49% due 12/3/1999 - - 36,965 36,948
USAA Capital Corp. 5.72%-5.92% due 1/19-2/9/2000 35,00 34,84 35,000 34,664
E.I. du Pont de Nemours and Co. 5.55% due 2/3/2000 35,00 34,80 35,000 34,633
Merck & Co. Inc. 5.30%-6.15% due 2/1-2/4/2000 40,00 39,77 35,000 34,627
General Electric Capital Corp. 5.84% due 1/18/2000 34,00 33,90 34,000 33,728
General Motors Acceptance Corp. 5.29%-6.02% 53,05 52,66 30,800 30,507
due 12/22/1999-2/17/2000
SBC Communications Inc. 5.26%-5.82% due 14,25 14,17 30,588 30,434
12/3/1999-2/18/2000 (2)
Gannett Co. 5.85%-5.90% due 1/14-1/21/2000 (2) 29,60 29,51 29,600 29,368
International Lease Finance Corp. 5.76%-5.83% 28,00 27,84 28,000 27,701
due 2/1-2/9/2000
Associates First Capital Corp. 5.72% due 2/24/2000 25,00 24,77 25,000 24,649
Equilon Enterprises, LLC 5.92%-5.94% due 1/28/2000 21,70 21,60 21,700 21,492
H.J. Heinz Co. 5.28% due 12/1/1999 - - 19,700 19,697
Pfizer Inc 5.64% due 3/17/2000 (2) 14,50 14,32 14,500 14,249
Kellogg Co. 5.62% due 1/28/2000 7,00 6,96 7,000 6,933
Fortune Brands 5.85% due 1/27-1/28/2000 (2) 30,00 29,86 - -
Corporate Asset Funding Co. Inc. 6.00%-6.02% 26,70 26,56 - -
due 1/26-2/2/2000 (2)
Coca-Cola Co. 5.95% due 2/16/2000 26,50 26,29 - -
Duke Energy Corp. 6.08% due 2/22/2000 25,00 24,78 - -
Household Finance Corp. 5.94% due 1/31/2000 23,60 23,47 - -
CIT Group Holdings, Inc. 4.75% due 1/3/2000 9,70 9,69 - -
Avon Capital Corp. 6.70% due 1/6/2000 (2) 6,20 6,19 - -
Gillette Co. 5.85% due 1/10/2000 (2) 2,00 1,99 - -
Federal Agency Discount Notes - 0.78% / 1.63%
Freddie Mac 5.16%-5.75% due 12/17/1999-3/3/2000 33,00 32,73 65,503 65,000
Fannie Mae 5.26%-5.67% due 12/17/1999-2/24/2000 28,20 27,99 38,500 38,273
Federal Home Loan Banks 5.25% due 12/15/1999 - - 21,000 20,954
---------- ----------
TOTAL SHORT-TERM SECURITIES (cost: 976,958 971,492
$977,046,000 and $971,656,000, respectively)
---------- ----------
TOTAL INVESTMENT SECURITIES (cost: 7,828,805 7,656,736
$6,715,434,000 and $6,660,331,000, respectively)
Net cash, receivables and payables 5,999 (10,597)
---------- ----------
NET ASSETS $ 7,834,804 $7,646,139
============ ===========
(1) Non-income-producing security.
(2) Purchased in a private placement transaction;
resale to the public may require registration
or sale only to qualified institutional buyers.
ADR = American Depositary Receipts
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series Asset Allocation Fund
Investments in both stocks and bonds
Investment Portfolio, December 31 & November 30, 1999
<S> <C> <C> <C> <C>
December 31 November 30
Percent of Percent of
Net Assets Net Assets
Equity Securities 62.63 61.48
U.S. Government Bonds 15.54 15.87
Corporate Bonds 14.17 14.29
Non-U.S. Government Bonds 0.15 0.15
Cash & Equivalents 7.51 8.21
LARGEST INDIVIDUAL EQUITY SECURITIES
Computer Associates International 2.63 2.46
CenturyTel 2.21 2.16
Citigroup 2.17 2.12
Bank of America 1.67 1.97
Carnival 1.94 1.80
Household International 1.62 1.73
AstraZeneca - 1.71
Pitney Bowes 1.68 1.68
United Technologies 1.85 1.62
Nokia 2.20 1.61
Corning 1.87 -
December 31 November 30
Market Market
Number of Value Number of Value
Shares (000) Shares (000)
Stocks (common and preferred) -------- -------- -------- --------
--------------------------------------------
DATA PROCESSING & REPRODUCTION - 7.21% / 6.46%
Computer Associates International, Inc. 650,000 45,459 650,000 42,250
International Business Machines Corp. 150,000 16,200 150,000 15,459
Gateway, Inc. (1) 200,000 14,413 200,000 15,275
Hewlett-Packard Co. 150,000 17,091 150,000 14,231
Storage Technology Corp. (1) 600,000 11,063 600,000 11,850
Autodesk, Inc. 400,000 13,500 400,000 11,725
Xerox Corp. 300,000 6,806 - -
ENERGY SOURCES - 6.21% / 6.29%
Royal Dutch Petroleum Co., New York registered 360,000 21,758 360,000 20,880
(Netherlands)
Atlantic Richfield Co. 200,000 17,300 200,000 19,275
Chevron Corp. 150,000 12,994 150,000 13,284
Kerr-McGee Corp. 150,000 9,300 200,000 11,450
Ultramar Diamond Shamrock Corp. 400,000 9,075 400,000 10,125
Phillips Petroleum Co. 200,000 9,400 200,000 9,562
Texaco Inc. 250,000 13,578 150,000 9,141
Murphy Oil Corp. 135,000 7,746 135,000 7,627
Conoco Inc., Class B 245,684 6,111 245,684 6,434
BANKING - 6.76% / 5.88%
Citigroup Inc. 675,000 37,505 675,000 36,366
Bank of America Corp. 576,320 28,924 576,320 33,715
Washington Mutual Savings Bank 400,000 10,400 400,000 11,600
KeyCorp 250,000 5,531 250,000 6,750
Tokai Preferred Capital Co. LLC, Series A, 3,000 2,989 3,000 3,047
9.98% noncumulative preferred (Japan) (2)
Fuji JGB Investment LLC, Series A, 9.87% 2,500 2,500 2,500 2,522
noncumulative preferred (Japan) (2)
BNP U.S. Funding LLC, Series A, 7.738% 2,500 2,327 2,500 2,327
noncumulative preferred (2)
First Republic Capital Corp., Series A, 10.50% 2,250 2,059 2,250 2,166
preferred (2)
NB Capital Corp. 8.35% exchangeable depositary 60,000 1,290 60,000 1,391
IBJ Preferred Capital Co. LLC, Series A, 1,000 945 1,000 955
8.79% noncumulative preferred (2)
BANK ONE CORP. 700,000 22,444 - -
HEALTH & PERSONAL CARE - 5.32% / 5.69%
AstraZeneca PLC (ADR) (United Kingdom) 660,000 27,555 660,000 29,370
SmithKline Beecham PLC (ADR) (United Kingdom) 300,000 19,331 300,000 19,950
Warner-Lambert Co. 200,000 16,388 200,000 17,938
Pfizer Inc 300,000 9,731 300,000 10,856
Eli Lilly and Co. 150,000 9,975 150,000 10,762
Gillette Co. 216,960 8,936 216,960 8,719
MERCHANDISING - 4.31% / 3.83%
Albertson's, Inc. 820,000 26,445 500,000 15,969
J.C. Penney Co., Inc. 628,000 12,521 628,000 14,012
Limited Inc. 318,273 13,785 318,273 13,507
May Department Stores Co. 400,000 12,900 400,000 13,450
Walgreen Co. 300,000 8,775 300,000 8,738
DIVERSIFIED TELECOMMUNICATION SERVICES
- 3.91% / 3.83%
CenturyTel, Inc. 804,375 38,107 804,375 37,001
Sprint FON Group 350,000 23,559 350,000 24,281
COLT Telecom Group PLC (ADR) (United Kingdom) (1) 29,250 5,967 29,250 4,362
AEROSPACE & MILITARY TECHNOLOGY - 3.00% / 3.02%
United Technologies Corp. 491,800 31,967 491,800 27,787
Raytheon Co., Class B 420,000 11,156 420,000 12,889
Raytheon Co., Class A 100,000 2,481 100,000 2,912
Boeing Co. 150,000 6,234 200,000 8,162
BUSINESS SERVICES - 2.78% / 2.84%
Pitney Bowes Inc. 600,000 28,988 600,000 28,763
Rentokil Initial PLC (ADR) (United Kingdom) 500,000 18,000 500,000 18,906
EarthWatch Inc., Series B, 7.00% convertible 289,991 1,000 289,991 1,000
preferred (1)(2)(3)(4)(5)
ELECTRICAL & ELECTRONICS - 3.41% / 2.70%
Nokia Corp., Class A (ADR) (Finland) 200,000 38,000 200,000 27,637
York International Corp. 450,000 12,347 450,000 10,041
Emerson Electric Co. 150,000 8,606 150,000 8,550
INSURANCE - 2.61% / 2.53%
American General Corp. 176,700 13,407 176,700 12,954
CIGNA Corp. 150,000 12,084 150,000 12,338
Allstate Corp. 400,000 9,600 350,000 9,166
Aon Corp. 250,000 10,000 250,000 8,922
CHEMICALS - 2.16% / 2.27%
Monsanto Co. 365,600 13,025 365,600 15,424
Millennium Chemicals Inc. 600,000 11,850 600,000 11,738
PPG Industries, Inc. 200,000 12,512 200,000 11,712
LEISURE & TOURISM - 1.94% / 1.80%
Carnival Corp. 700,000 33,469 700,000 30,888
Discovery Zone, Inc. (1)(5) 2,940 2,940 1
Discovery Zone, Inc., warrants, expire 2007 (1)(4)(5) 326 326 -
FINANCIAL SERVICES - 1.62% / 1.73%
Household International, Inc. 750,000 27,938 750,000 29,672
BEVERAGES & TOBACCO - 1.64% / 1.67%
PepsiCo, Inc. 520,000 18,330 520,000 17,972
UST Corp. 400,000 10,075 400,000 10,650
ELECTRONIC COMPONENTS - 1.86% / 1.36%
Corning Inc. 250,000 32,234 250,000 23,422
MACHINERY & ENGINEERING - 1.30% / 1.29%
Millipore Corp. 300,000 11,588 350,000 11,484
Deere & Co. 250,000 10,844 250,000 10,734
INDUSTRIAL COMPONENTS - 1.12% / 1.10%
Dana Corp. 400,000 11,975 400,000 11,100
Genuine Parts Co. 300,000 7,444 300,000 7,725
BROADCASTING & PUBLISHING - 0.98% / 0.92%
New York Times Co., Class A 300,000 14,737 350,000 13,453
Adelphia Communications Corp., Series B, 20,000 2,200 20,000 2,255
13.00% exchangeable preferred 2009 (1)
FOREST PRODUCTS & PAPER - 0.82% / 0.74%
Weyerhaeuser Co. 150,000 10,772 150,000 9,188
Sonoco Products Co. 150,000 3,413 150,000 3,450
ENERGY EQUIPMENT - 0.65% / 0.70%
Schlumberger Ltd. (Netherlands Antilles) 200,000 11,250 200,000 12,013
FOOD & HOUSEHOLD PRODUCTS - 0.62% / 0.66%
General Mills, Inc. 300,000 10,725 300,000 11,306
MULTI-INDUSTRY - 0.51% / 0.62%
Dover Corp. 150,000 6,806 200,000 8,675
Swire Pacific Capital Ltd. 8.84% cumulative 100,000 2,025 100,000 1,950
guaranteed perpetual capital securities
(Hong Kong) (2)
WIRELESS TELECOMMUNICATION SERVICES - 0.66% / 0.60%
Omnipoint Corp. 7.00% convertible preferred (2) 40,000 6,680 40,000 5,800
Crown Castle International Corp. 12.75% 2,267 2,347 2,197 2,286
exchangeable preferred 2010 (1)(2)(3)
Nextel Communications, Inc., Series D, 13.00% 1,657 1,756 1,657 1,756
exchangeable preferred 2009 (1)(3)
McCaw International, Ltd. (owned by Nextel 2,000 5 2,000 5
Communications, Inc.), warrants, expire 2007
(1)(2)(4)
Esat Telecom Group PLC, warrants, expire 2007 3,500 642 3,500 458
(Ireland) (1)(2)(4)(5)
Conecel Holdings Ltd., Class B, warrants, 77,700 8 77,700 8
expire 2000 (Ecuador) (1)(2)(4)(5)
Iridium LLC, warrants, expire 2005 (1)(2)(4)(5) 1,500 1,500 -
UTILITIES: ELECTRIC & GAS - 0.35% / 0.35%
Central and South West Corp. 300,000 6,000 300,000 6,000
METALS: STEEL - 0.00% / 0.19%
Allegheny Telchnologies, Inc. (formerly Allegheny - 128,200 3,229
Teledyne Inc.)
REAL ESTATE - 0.05% / 0.04%
CarrAmerica Realty Corp., Series B, 8.57% 50,000 806 50,000 784
redeemable preferred
RECREATION & OTHER CONSUMER PRODUCTS
- 0.00% / 0.00%
V2 Music Holdings, warrants, expire 2008 1,250 1,250 -
(United Kingdom) (1)(2)(5)
MISCELLANEOUS - 0.08% / 1.53%
Other stocks in initial period of acquisition 1,307 26,161
---------- ----------
TOTAL STOCKS (cost: $782,800,000 and 1,069,316 1,039,648
$777,392,000, respectively)
---------- ----------
Principal Market Principal Market
Amount Value Amount Value
(000) (000) (000)
Convertible Debentures -------- -------- -------- --------
--------------------------------------------
INDUSTRIALS & SERVICES - 0.75% / 0.84%
Bell Atlantic Financial Services, Inc. 4.25% $2,150 2,645 $4,000 4,350
senior exchangeable notes 2005 (2)
Bell Atlantic Financial Services, Inc. 5.75% 2003 (2) 3,500 3,535 3,500 3,474
Sunglass Hut International, Inc. 5.25% 2003 3,375 2,717 3,375 2,717
USA Waste Services, Inc. 4.00% 2002 2,000 1,700 2,000 1,670
Advanced Micro Devices, Inc. 6.00% convertible 1,500 1,530 1,500 1,417
subordinated notes 2005
Ingram Micro Inc. 0% 2018 (2) 2,700 877 2,700 867
---------- ----------
TOTAL CONVERTIBLE DEBENTURES (cost: 13,004 14,495
$12,481,000 and $14,260,000, respectively)
---------- ----------
TOTAL EQUITY SECURITIES (cost: 1,082,320 1,054,143
$795,281,000 and $791,652,000, respectively)
---------- ----------
Principal Market Market
Amount Value Principal Value
Bonds & Notes (000) (000) Amount (000)
-------------------------------------------- -------- -------- -------- --------
BANKING & THRIFTS - 1.81% / 1.84%
National Westminster Bank PLC:
7.75% 2049 3,200 3,075 3,200 3,120
7.375% 2009 2,500 2,443 2,500 2,488
9.45% 2001 1,000 1,031 1,000 1,035
BANK ONE CORP.:
5.625% 2004 2,500 2,345 2,500 2,364
6.00% 2009 2,000 1,779 2,000 1,812
Imperial Capital Trust I, Series B, 9.98% 2026 2,950 2,621 2,950 2,692
MBNA Corp.:
Capital A, Series A, 8.278% 2026 2,010 1,749 2,010 1,783
Capital B, Series B, 7.005% 2027 (6) 1,000 824 1,000 810
Chase Capital II, Series B, 6.705% 2027 (6) 2,500 2,363 2,500 2,364
Bankers Trust Corp. 6.70% 2007 2,080 1,956 2,080 1,986
Advanta Capital Trust I 8.99% 2026 3,000 2,070 3,000 1,980
Banque Nationale de Paris 6.765%/6.138% 2049 (6) 2,000 1,937 2,000 1,934
Chevy Chase Bank, FSB 9.25% 2008 2,000 1,880 2,000 1,920
Fleet Capital Trust 7.14%/6.513% 2028 (6) 1,500 1,482 1,500 1,481
Chase Capital III, Series C, 6.66%/6.053% 2027 (6) 1,500 1,410 1,500 1,410
Komercni Banka AS 9.00%/10.75% 2008 (2)(7) 1,000 933 1,000 935
Abbey National PLC 6.70% 2049 1,000 902 1,000 913
J.P. Morgan & Co. Inc., Series A, 6.00% 2009 510 456 510 465
FINANCIAL SERVICES - 1.66% / 1.73%
Capital One Bank:
7.35% 2000 5,000 5,005 5,000 5,008
6.375% 2003 2,500 2,398 2,500 2,412
Ford Motor Credit Co. 5.80% 2009 3,500 3,102 3,500 3,147
Capital One Financial Corp. 7.125% 2008 3,200 2,919 3,200 2,966
GS Escrow Corp. 7.125% 2005 3,000 2,696 3,000 2,726
BHP Finance Ltd. 6.75% 2013 2,680 2,392 2,680 2,441
Providian National Bank 6.65% 2004 2,500 2,360 2,500 2,388
MBNA America Bank, NA 6.75% 2008 2,500 2,302 2,500 2,324
Household Finance Corp. 6.40% 2008 1,500 1,387 2,250 2,113
Wharf International Finance Ltd. 7.625% 2007 1,750 1,624 1,750 1,582
AT&T Capital Corp. 6.875% 2001 1,500 1,500 1,500 1,503
Capital One Capital I 7.755% 2027 (2)(6) 1,250 1,079 1,250 1,080
DIVERSIFIED MEDIA & CABLE TELEVISION - 1.47% / 1.64%
Time Warner Inc. 9.125% 2013 5,500 6,023 5,500 6,162
NTL Inc.:
0%/11.50% 2009 (2)(7) 4,500 2,626 4,500 2,651
11.50% 2008 1,000 1,080 1,000 1,085
Fox/Liberty Networks, LLC 0%/9.75% 2007 (7) 4,000 3,200 4,000 3,180
Comcast Cable Communications, Inc. 8.875% 2017 - 2,500 2,760
Charter Communications Holdings, LLC 0%/9.92% 2011 (7) 4,000 2,340 4,000 2,420
Telemundo Holdings, Inc. 0%/11.50% 2008 (7) 4,000 2,380 4,000 2,280
TCI Communications, Inc. 8.75% 2015 2,000 2,182 2,000 2,213
Hearst-Argyle Television, Inc. 7.50% 2027 2,000 1,848 2,000 1,836
Liberty Media Corp. 7.875% 2009 (2) 1,500 1,493 1,500 1,499
Cablevision Industries Corp. 8.125% 2009 1,250 1,228 1,250 1,246
Conecel Holdings Ltd.:
Series A, 14.00% 2000 (2)(4)(5) 3,000 300 3,000 300
14.00% 2002 (5) 1,000 305 1,000 242
V2 Music Holdings, units 0%/14.00% 2008 (2)(7) 1,250 337 1,250 337
WIRELESS TELECOMMUNICATION SERVICES - 1.13% / 1.10%
Nextel Communications, Inc.:
0%/9.95% 2008 (7) 4,500 3,161 4,500 3,173
0%/9.75% 2007 (7) 2,000 1,425 2,000 1,435
0%/10.65% 2007 (7) 1,500 1,121 1,500 1,129
McCaw International, Ltd. (owned by Nextel 6,000 4,140 6,000 3,990
Communications, Inc.) 0%/13.00% 2007 (7)
Clearnet Communications Inc.:
0%/11.75% 2007 (7) 5,250 2,587 5,250 2,511
0%/10.40% 2008 (7) 4,000 1,750 4,000 1,690
0%/10.125% 2009 (7) 1,250 759 1,250 766
Esat Telecom Group PLC 0%/12.50% 2007 (7) 3,500 2,975 3,500 2,625
Omnipoint Corp. 11.625% 2006 1,500 1,590 1,500 1,590
TRANSPORTATION: AIRLINES - 1.00% / 1.02%
Continental Airlines, Inc.:
Series 1996-2C, 10.22% 2014 (8) 2,092 2,204 2,092 2,233
Series 1998-3C, 7.25% 2005 1,500 1,436 1,500 1,454
Series 1997-4A, 6.90% 2018 1,469 1,360 1,469 1,371
United Air Lines, Inc.:
Series 1996-A2, 7.87% 2019 2,500 2,263 2,500 2,299
Series 1995-A1, 9.02% 2012 (8) 1,321 1,326 1,321 1,345
9.00% 2003 500 515 500 519
Delta Air Lines, Inc., pass-through trust: (8)
Series 1993-A2, 10.50% 2016 2,000 2,276 2,000 2,302
Series 1992-A2, 9.20% 2014 1,000 1,036 1,000 1,049
Airplanes Pass Through Trust, Class 1-C, 8.15% 2019 (8) 2,851 2,651 2,932 2,756
Jet Equipment Trust, Series 1995-B, 7.83% 2015 (2)(8) 2,251 2,196 2,251 2,203
ENERGY & RELATED COMPANIES - 0.88% / 0.90%
Union Pacific Resources Group, Inc. 7.30% 2009 3,100 2,977 3,100 3,005
USX Corp. 9.125% 2013 2,500 2,716 2,500 2,777
Oryx Energy Co. 8.375% 2004 2,500 2,564 2,500 2,574
Norcen Energy Resources Ltd. 7.375% 2006 2,000 1,947 2,000 1,961
OXYMAR 7.50% 2016 (2) 2,500 1,661 2,500 1,734
Louis Dreyfus Natural Gas Corp. 9.25% 2004 1,500 1,522 1,500 1,524
Cross Timbers Oil Co. 8.75% 2009 1,000 945 1,000 965
Conoco Inc. 6.35% 2009 1,000 927 1,000 944
DIVERSIFIED TELECOMMUNICATIONS SERVICES
- 0.75% / 0.74%
Cable & Wireless Communications PLC:
6.625% 2005 3,300 3,259 3,300 3,292
6.75% 2008 2,000 1,970 2,000 2,003
COLT Telecom Group PLC 0%/12.00% 2006 (7) 3,750 3,300 3,750 3,225
Telesystem International Wireless Inc. 3,700 2,368 3,700 2,127
0%/13.25% 2007 (7)
CEI Citicorp Holdings SA 11.25% 2007 (2) 2,500 2,044 2,500 2,044
ASSET-BACKED OBLIGATIONS (8) - 0.63% / 0.64%
Sears Credit Account Master Trust II, 3,250 3,046 3,250 3,072
Series 1998-2, Class A, 5.25% 2008
H.S. Receivables Corp., Series 1999-1, 2,500 2,475 2,500 2,475
Class A, 8.13% 2004 (2)
First Consumer Master Trust, Series 1999-A, 2,250 2,159 2,250 2,156
Class A, 5.80% 2005 (2)
Providian Master Trust, Series 1999-2, 1,750 1,737 1,750 1,748
Class A, 6.60% 2007
FIRSTPLUS Home Loan Owner Trust, 1,500 1,485 1,500 1,488
Series 1997-1, Class A-6, 6.95% 2015
UTILITIES: ELECTRIC & GAS - 0.59% / 0.60%
Israel Electric Corp. Ltd.: (2)
7.25% 2006 2,500 2,364 2,500 2,396
7.70% 2018 1,750 1,554 1,750 1,541
7.75% 2027 1,500 1,296 1,500 1,322
Edison Mission Energy 7.73% 2009 (2) 2,000 1,979 2,000 1,981
Commonwealth Edison Co., Series 75, 9.875% 2020 1,500 1,617 1,500 1,655
Energen Corp., Series B, 7.125% 2028 1,500 1,325 1,500 1,353
MERCHANDISING - 0.56% / 0.57%
J.C. Penney Co., Inc.:
8.25% 2022 3,150 2,800 3,150 2,852
7.60% 2007 2,000 1,859 2,000 1,911
7.95% 2017 2,000 1,778 2,000 1,779
Dayton Hudson Corp. 8.50% 2022 2,500 2,501 2,500 2,524
Venator Group, Inc., Series A, 7.00% 2002 750 683 750 690
FOREST PRODUCTS & PAPER - 0.48% / 0.54%
Fort James Corp. 6.625% 2004 2,500 2,410 2,500 2,429
Container Corp. of America 9.75% 2003 2,000 2,040 2,000 2,040
Scotia Pacific Co. LLC, Class A-2, 7.11% 2028 2,000 1,749 2,000 1,652
Kappa Beheer BV 10.625% 2009 (2) 1,250 1,327 1,250 1,315
Pacifica Papers Inc. 10.00% 2009 - 1,000 1,030
Pindo Deli Finance Mauritius Ltd. 10.75% 2007 1,000 727 1,000 708
COLLATERALIZED MORTGAGE OBLIGATIONS
(PRIVATELY ORIGINATED) (8) - 0.52% / 0.53%
DLJ Mortgage Acceptance Corp., Series 3,000 2,973 3,000 3,004
1996-CF2, Class A1, 7.29% 2021 (2)
Morgan Stanley Capital I, Inc., Series 1998-HF2, 3,000 2,821 3,000 2,862
Class A-2, 6.48% 2030
L.A. Arena Funding, LLC 7.66% 2026 (2) 2,000 1,783 2,000 1,802
GMAC Commercial Mortgage Securities, Inc., 1,390 1,384 1,417 1,417
Series 1997-C1, Class A-1, 6.83% 2003
REAL ESTATE - 0.35% / 0.36%
SocGen Real Estate Co. LLC, Series A, 5,700 5,144 5,700 5,216
7.64%/8.40% preferred 2049 (2)(6)
EOP Operating LP 7.25% 2018 1,000 880 1,000 891
FOOD & HOUSEHOLD PRODUCTS - 0.31% / 0.31%
Home Products International, Inc. 9.625% 2008 3,000 2,737 3,000 2,708
Fage Dairy Industry SA 9.00% 2007 2,000 1,760 2,000 1,800
Gruma, SA de CV 7.625% 2007 1,000 870 1,000 878
METALS: NONFERROUS - 0.31% / 0.31%
Freeport-McMoRan Copper & Gold Inc. 7.20% 2026 2,750 2,077 2,750 2,080
Inco Ltd. 9.60% 2022 2,000 1,938 2,000 1,943
Doe Run Resources Corp. 12.231% 2003 (6) 1,500 1,380 1,500 1,350
BROADCASTING & PUBLISHING - 0.31% / 0.31%
British Sky Broadcasting Group PLC 8.20% 2009 (2) 2,250 2,176 2,250 2,143
RBS Participacoes SA 11.00% 2007 (2) 2,000 1,695 2,000 1,595
Ziff-Davis Inc. 8.50% 2008 1,500 1,562 1,500 1,470
HEALTH & PERSONAL CARE - 0.28% / 0.29%
Allegiance Corp. 7.00% 2026 3,000 2,914 3,000 2,896
Lilly Del Mar 7.355% 2029 (2)(6) 1,750 1,752 1,750 1,752
Integrated Health Services, Inc., Series A: (5)
9.25% 2008 1,750 144 1,750 158
9.50% 2007 1,250 103 1,250 112
LEISURE & TOURISM - 0.22% / 0.22%
Royal Caribbean Cruises Ltd. 7.00% 2007 3,000 2,823 3,000 2,857
Horseshoe Gaming Holding Corp. 8.625% 2009 (2) 1,000 955 1,000 963
BUSINESS SERVICES - 0.28% / 0.12%
Allied Waste North America, Inc. 10.00% 2009 (2) 1,300 1,160 1,300 1,188
USA Waste Services, Inc. 6.50% 2002 1,000 926 1,000 912
Cendant Corp. 7.75% 2003 2,750 2,743 - -
ELECTRICAL & ELECTRONICS - 0.11% / 0.11%
Hyundai Semiconductor America, Inc. 8.625% 2007 (2) 2,400 1,995 2,400 1,950
MULTI-INDUSTRY - 0.16% / 0.10%
Tyco International Group SA 6.875% 2002 (2) 2,800 2,761 1,800 1,774
MANUFACTURING & MATERIALS - 0.09% / 0.10%
Owens-Illinois, Inc. 8.10% 2007 1,750 1,654 1,750 1,676
INSURANCE - 0.09% / 0.09%
ReliaStar Financial Corp. 8.00% 2006 1,500 1,508 1,500 1,529
CHEMICALS - 0.06% / 0.06%
Equistar Chemicals, LP 8.75% 2009 1,000 988 1,000 992
APPLIANCES & HOUSEHOLD DURABLES - 0.06% / 0.06%
Samsung Electronics Co., Ltd. 7.45% 2002 (2) 1,000 984 1,000 978
INDUSTRIAL COMPONENTS - 0.06% / 0.00%
Cooper Tire & Rubber Co. 7.25% 2002 1,000 989 - -
NON-U.S. GOVERNMENTS & GOVERNMENTAL
AUTHORITIES - 0.15% / 0.15%
Canadian Government 4.60% 2026 (9) 2,000 1,533 2,000 1,496
Mendoza (Province of) 10.00% 2007 (2) 1,300 1,017 1,300 978
FEDERAL AGENCY OBLIGATIONS: MORTGAGE
PASS-THROUGHS (8) - 4.38% / 4.49%
Government National Mortgage Assn.:
7.00% 2022-2029 18,345 17,747 18,531 18,121
8.00% 2020-2029 16,210 16,422 16,290 16,600
7.50% 2029 9,762 9,652 9,854 9,832
6.50% 2029 9,333 8,758 9,343 8,887
8.50% 2021-2029 2,361 2,439 2,364 2,451
10.00% 2019 517 558 528 571
Fannie Mae:
6.50% 2013 8,391 8,140 8,512 8,323
6.00% 2013 8,297 7,872 8,376 8,018
8.50% 2024 2,917 2,993 2,957 3,047
7.00% 2009 902 893 917 914
9.00% 2019 269 280 269 282
U.S. TREASURY OBLIGATIONS - 11.16% / 11.38%
7.25% 2004-2016 50,000 51,963 50,000 52,739
6.50% 2002-2005 50,000 50,151 50,000 50,581
7.00% 2006 25,000 25,606 25,000 25,969
10.375% 2009-2012 16,000 19,319 16,000 19,626
6.625% 2007 15,000 15,059 15,000 15,291
3.739% 2002 (9) 10,000 10,398 10,000 10,400
8.75% 2000-2008 8,000 8,398 8,000 8,460
8.25% 2005 5,000 5,032 5,000 5,046
11.875% 2003 2,500 2,951 2,500 2,981
9.125% 2009 1,500 1,638 1,500 1,655
11.125% 2003 1,000 1,146 1,000 1,159
11.75% 2010 500 608 500 615
10.75% 2003 500 565 500 570
---------- ----------
TOTAL BONDS & NOTES (COST: $545,990,000 515,961 519,633
and $546,490,000, respectively)
---------- ----------
Market Market
Principal Value Principal Value
Short-Term Securities Amount 0 Amount (000)
-------------------------------------------- -------- -------- -------- --------
CORPORATE SHORT-TERM NOTES - 6.15% / 6.07%
H.J. Heinz Co. 5.30%-6.05% due 12/2/1999-1/12/2000 8,600 8,582 25,300 25,277
Bell Atlantic Network Funding Corp. 5.30%-5.82% 5,500 5,490 17,500 17,440
due 12/13/1999-1/11/2000
BellSouth Telecommunications, Inc. 5.28% - 15,000 14,994
due 12/3/1999 (2)
Alcoa Inc. 5.30%-5.48% due 12/1-12/3/1999 - 13,465 13,460
USAA Capital Corp. 5.85%-6.03% due 1/24-1/30/2000 21,500 21,403 13,400 13,273
Motorola, Inc. 5.32% due 12/23/1999 - 12,300 12,258
PACCAR Financial Corp. 5.27% due 12/10/1999 - 7,400 7,389
American Express Credit Corp. 5.55% due 3/1/2000 21,000 20,793 - -
Colgate-Palmolive Co. 5.95% due 1/28/2000 (2) 8,900 8,859 - -
Sara Lee Corp. 5.87% due 1/6/2000 8,100 8,092 - -
Anheuser-Busch Companies, Inc. 6.05% due 2/11/2000 7,500 7,447 - -
Merck & Co. Inc. 6.15% due 2/1/2000 7,300 7,260 - -
Gillette Co. 5.85% 1/10/2000 (2) 4,600 4,592 - -
Park Avenue Receivables 6.15% due 1/10/2000 (2) 4,250 4,243 - -
Associates First Capital Corp. 4.00% due 1/3/2000 3,500 3,499 - -
National Rural Utilities Cooperative Finance 3,300 3,265 - -
Corp. 5.98% due 3/7/2000
Procter & Gamble Co. 6.05% due 2/11/2000 2,700 2,681 - -
FEDERAL AGENCY DISCOUNT NOTES - 0.90% / 2.17%
Freddie Mac 5.44%-5.75% due 12/16/1999-2/15/2000 15,700 15,585 37,211 37,114
---------- ----------
TOTAL SHORT-TERM SECURITIES (COST: 121,791 141,205
$121,799,000 and $141,204,000, respectively)
---------- ----------
TOTAL INVESTMENT SECURITIES (COST: 1,720,072 1,714,981
$1,463,070,000 and $1,479,346,000, respectively)
Net cash, receivables and payables 8,048 (468)
---------- ----------
NET ASSETS 1,728,120 1,714,513
(1)Non-income-producing security.
(2)Purchased in a private placement transaction;
resale to the public may require registration or sale
only to qualified institutional buyers.
(3)Payment in kind. The issuer has the option of paying
additional securities in lieu of cash.
(4) Valued under procedures established by the
Board of Trustees.
(5)Company not making interest payments; bankruptcy
proceedings pending.
(6) Coupon rate changes periodically.
(7) Step bond; coupon rate will increase at a later date.
(8) Pass-through securities backed by a pool of
mortgages or other loans on which principal payments
are periodically made. Therefore, the effective
maturity is shorter than the stated
maturity.
(9) Index-linked bond, which is a floating-rate note whose
principal amount moves with a government retail price
index.
ADR=American Depositary Receipts
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series Bond Fund
Investment Portfolio, December 31 and
November 30, 1999
<S> <C> <C> <C> <C>
December November 30
Corporate Bonds 60.89% 61.25%
U.S. Government Bonds 16.80% 17.99%
Equity Securities 7.65% 7.79%
Non-U.S. Government Bonds 3.03% 3.24%
Cash & Equivalents 11.63% 9.73%
December December November November 30
Principal Market Principal Market
Amount Value Amount Value
Bonds & Notes (000) (000) (000) (000)
-------------------------------------------- -------- -------- -------- --------
WIRELESS TELECOMMUNICATION SERVICES
- 8.02%/7.89%
Nextel Communications, Inc.:
0%/9.95% 2008(1) $2,625 $1,844 $2,625 $1,851
0%/9.75% 2007(1) 2,475 1,763 2,475 1,776
0%/10.65% 2007(1) 1,275 953 1,275 959
12.00% 2008 500 560 500 557
McCaw International, Ltd. (owned by Nextel 2,125 1,466 2,125 1,413
Communications, Inc.)
0%/13.00% 2007 (1)
Nextel International, Inc. 0%/12.125% 2008(1) 1,000 590 1,000 550
Clearnet Communications Inc.:(1)
0%/11.75% 2007 C$2658 1,310 C$2,658 1,271
0%/10.40% 2008 3,000 1,312 3,000 1,267
0%/10.125% 2009 $ 500 304 $ 500 306
Omnipoint Corp.:
11.625% 2006 1,500 1,590 1,500 1,590
11.50% 2009 (2) 1,000 1,080 1,000 1,080
Esat Telecom Group PLC 0%/12.50% 2007(1) 2,000 1,700 2,000 1,500
Crown Castle International Corp.:
0%/10.625% 2007(1) 1,000 755 1,000 750
0%/11.25% 2011(1)(2) 1,000 625 1,000 620
VoiceStream Wireless Corp. 10.375% 2009(2) 1,000 1,030 1,000 1,043
PanAmSat Corp. 6.125% 2005 1,000 886 1,000 894
SpectraSite Holdings, Inc.:
0%/11.25% 2009(1) 1,125 602 1,125 574
0%/12.00% 2008(1) 500 295 500 285
PageMart Wireless, Inc.:
0%/15.00% 2005(1) 500 439 500 440
0%/11.25% 2008(1) 750 255 750 233
American Cellular Corp. 10.50% 2008 500 554 500 555
Dobson/Sygnet Communications Co. 12.25% 2008 250 277 250 278
Conecel Holdings Ltd.:
14.00% 2002(3) 500 153 500 121
Series A, 14.00% 2000(2)(3)(4) 600 60 600 60
BROADCASTING & PUBLISHING - 7.15%/7.57%
Fox/Liberty Networks, LLC, FLN Finance, Inc.:
0%/9.75% 2007(1) 2,750 2,200 2,750 2,186
8.875% 2007 500 509 500 510
Charter Communications Holdings, LLC:
0%/9.92% 2011(1) 3,250 1,901 3,250 1,966
8.25% 2007 500 465 500 472
CBS Corp. 7.15% 2005 2,000 1,962 2,000 1,981
Liberty Media Corp. 7.875% 2009(2) 1,900 1,891 1,900 1,898
Comcast UK Cable Partners Ltd. 0%/11.20% 2007(1) 650 617 650 611
NTL Communications Corp.
11.50% 2008 500 540 500 543
Series B, 10.00% 2007 250 256 250 256
Hearst-Argyle Television, Inc. 7.00% 2018 1,500 1,333 1,500 1,337
Time Warner Inc.:
7.75% 2005 500 506 500 511
7.95% 2000 500 501 500 501
Chancellor Media Corp. of Los Angeles:
Series B, 8.75% 2007 500 510 500 500
8.125% 2007 500 501 500 495
British Sky Broadcasting Group PLC 8.20% 2009(2) 1,000 967 1,000 953
Cablevision Industries Corp. 8.125% 2009 750 737 750 747
American Media Operations, Inc. 10.25% 2009 750 759 750 743
Cox Communications, Inc. 7.75% 2006 - - 700 712
Telemundo Holdings, Inc. 0%/11.50% 2008(1) 1,000 595 1,000 570
Ziff-Davis Inc. 8.50% 2008 500 521 500 490
Comcast Cable Communications, Inc. 8.875% 2017 - - 250 276
Rogers Communications, Inc. 8.875% 2007 250 252 250 251
V2 Music Holdings PLC 0%/14.00% 2008(1)(2) L575 251 L575 248
RBS Participacoes SA 11.00% 2007(2) 250 212 250 199
TVN Entertainment Corp. 14.00% 2008(2) 300 84 300 120
Globo Comunicacoes Participacoes Ltd. 10.50% 2006(2) 120 104 120 100
BANKING - 7.10%/7.18%
Advanta Corp.:
Series B, 7.00% 2001 2,265 2,123 2,265 2,121
Series D, 6.98% 2002 1,000 913 1,000 912
Series D, 6.925% 2002 500 456 500 456
Advanta Capital Trust I 8.99% 2026 500 345 500 330
J.P. Morgan & Co. Inc.:
Series A, 6.783% 2012(5) 2,000 1,729 2,000 1,755
Series A, 6.00% 2009 340 304 340 310
SocGen Real Estate Co. LLC, Series A, 2,250 2,030 2,250 2,059
7.64% (undated)(1)(2)(6)
Bank One Corp.:
Series A, 6.00% 2009 1,080 961 1,080 978
Series A, 5.625% 2004 1,000 938 1,000 946
Deutsche Bank Capital Funding Trust I 7.872% 2,000 1,897 2,000 1,907
(undated)(2)(6)
Sakura Capital Funding 6.446% (undated)(2)(6) 1,000 948 1,000 947
Abbey National PLC 6.70% (undated)(6) 970 875 970 886
National Westminster Bank PLC:
7.75% (undated)(6) 500 480 500 487
9.375% 2003 276 293 276 296
MBNA Corp., MBNA Capital A, Series A, 8.278% 2026 850 739 850 754
Capital One Bank 6.375% 2003 500 480 500 482
Capital One Capital I 7.755% 2027 (2)(6) 250 216 250 216
Imperial Capital Trust I, Imperial Bancorp 9.98% 202 550 489 550 502
Chevy Chase Bank, FSB 9.25% 2008 500 470 500 480
Riggs Capital Trust II 8.875% 2027 500 446 500 452
Bank of Scotland 7.00% (undated)(2) 480 444 480 443
Bankers Trust New York Corp. 6.70% 2007 250 235 250 239
Komercni Finance BV 9.00%/10.75% 2008(1)(2) 250 233 250 234
COLLATERALIZED MORTGAGE OBLIGATIONS
(PRIVATELY ORIGINATED) - 4.56%/4.62%
GS Mortgage Securities Corp. II, mortgage
pass-through certificates:
Series 1998-C1, Class E, 7.333% 2030(6) 1,250 1,074 1,250 1,076
Series 1998-C1, Class D, 7.333% 2030(6) 1,000 899 1,000 880
Nomura Asset Securities Corp., Series 1998-D6, 1,748 1,680 1,762 1,707
Class A-A1, 6.28% 2030(6)
L.A. Arena Funding, LLC, Series 1, Class A, 1,300 1,159 1,300 1,172
7.656% 2026(2)
Merrill Lynch Mortgage Investors, Inc.:
Series 1995-C3, Class A-3, 6.995% 2025(6) 1,000 984 1,000 991
Series 1995-C2, Class A-1, 7.108% 2021(6) 141 140 146 144
CS First Boston Mortgage Securities Corp., 1,106 1,067 1,114 1,084
Series 1998-C1, Class A-1A, 6.26% 2040
Morgan Stanley Capital I Inc., 1,000 940 1,000 954
Series 1998-HF2, Class A-2, 6.48% 2030
Norwest Asset Securities Corp., 879 834 885 843
Series 1998-31, Class A-1, 6.25% 2014
LB Commercial Mortgage Trust, Series 1998-C1, 850 830 856 842
Class A1, 6.33% 2030
Structured Asset Securities Corp., 669 684 679 698
Series 1998-RF2, Class A, 8.55% 2027 (2)(6)
DLJ Mortgage Acceptance Corp., 600 593 600 597
Series 1995-CF2, Class A1B, 6.85% 2027 (2)
Commercial Mortgage Acceptance Corp., 449 432 452 438
Series 1998-C1, Class A-1, 6.23% 2007
GMAC Commercial Mortgage Securities, Inc., 278 277 283 283
Series 1997-C1, Class A1, 6.83% 2003
LEISURE & TOURISM - 4.60%/4.45%
Joseph E. Seagram & Sons, Inc. 6.625% 2005 2,000 1,909 2,000 1,920
Mirage Resorts, Inc.:
6.625% 2005 2,000 1,829 2,000 1,824
6.75% 2007 500 441 - -
Horseshoe Gaming Holding Corp. 8.625% 2009 1,500 1,432 1,500 1,444
Royal Caribbean Cruises Ltd.:
7.25% 2018 1,000 893 1,000 907
7.00% 2007 500 470 500 476
William Hill Finance 10.625% 2008 L750 1,242 L750 1,251
Premier Parks Inc.:
9.75% 2007 $1,000 1005 $1,000 991
0%/10.00% 2008(1) 250 171 250 170
Florida Panthers Holdings, Inc. 9.875% 2009 1,000 990 1,000 960
Boyd Gaming Corp. 9.50% 2007 500 495 500 492
Carmike Cinemas, Inc., Series B, 9.375% 2009 375 328 375 358
International Game Technology 8.375% 2009 250 242 250 242
Harrah's Operating Co., Inc. 7.875% 2005 250 241 250 242
DIVERSIFIED TELECOMMUNICATION SERVICES
- 3.89%/3.89%
Cable & Wireless Communications PLC:
6.625% 2005 3,660 3,615 3,660 3,651
6.75% 2008 500 493 500 501
COLT Telecom Group PLC:
8.875% 2007 DM1,250 691 DM1,250 689
7.625% 2008 1,000 514 1,000 526
0%/12.00% 2006(1) $250 220 $ 250 215
NEXTLINK Communications, Inc.:
0%/12.25% 2009(1) 1,500 953 1,500 908
9.625% 2007 500 491 500 488
Time Warner Telecom Inc. 9.75% 2008 1,225 1,256 1,225 1,262
Versatel Telecom International NV 11.875% 2009 750 767 750 756
Qwest Communications International Inc. 750 588 750 564
0%/8.29% 2008(1)
Allegiance Telecom, Inc. 0%/11.75% 2008(1) 250 178 250 177
Viatel, Inc. 11.25% 2008 125 124 125 124
FINANCIAL SERVICES - 2.86%/3.30%
Ford Motor Credit Co.:
7.375% 2009 - - 1,000 1,004
5.80% 2009 1,000 886 1,000 899
AT&T Capital Corp. 6.875% 2001 1,000 1,000 1,000 1,002
Toyota Motor Credit Corp. 6.00% 2003 1,000 969 1,000 974
Capital One Financial Corp. 7.125% 2008 1,000 912 1,000 927
AB Spintab 7.50% (undated)(2)(6) 750 718 750 720
Providian Financial Corp. 9.525% 2027(2) 750 636 750 646
BHP Finance Ltd. 6.69% 2006 600 569 600 576
Household Finance Corp. 6.40% 2008 500 462 500 470
MBNA Corp., MBNA 6.75% 2008 500 460 500 465
GS Escrow Corp. 7.125% 2005 500 449 500 454
BankUnited Capital Trust, BankUnited Financial 250 218 250 227
Corp., 10.25% 2026
TRANSPORTATION: AIRLINES - 2.59%/2.66%
Continental Airlines, Inc., pass-through
certificates(7):
Series 1998-3, Class C-2, 7.25% 2005 500 479 500 485
Series 1997-1, Class C, 7.42% 2007 470 459 470 462
Series 1999-1, Class B, 6.795% 2020 500 454 500 462
Series 1998-3, Class A-2, 6.32% 2008 500 454 500 461
Series 1998-1, Class A, 6.648% 2019 489 444 489 448
Series 1996, Class C, 9.50% 2015 228 235 228 238
Airplanes Pass Through Trust, pass-through 1,663 1,546 1,710 1,608
certificates Series 1, Class C, 8.15% 2019(7)
Atlas Air, Inc. pass-through trust, Series 1998-1, 1,474 1,337 1,474 1,360
Class A, 7.38% 2018(7)
Jet Equipment Trust(2)(7):
Series 1995-D, 11.44% 2014 300 338 300 345
Series 1994-A, Class B1,11.79% 2013 250 292 250 304
United Air Lines, Inc. 10.67% 2004(7) 500 548 500 552
MULTI-INDUSTRY - 2.48%/2.50%
Sony Corp. 6.125% 2003 2,500 2,437 2,500 2,453
American Standard Inc.:
8.25% 2009(2) 1,000 962 1,000 995
7.125% 2006 EUR 500 506EUR 500 500
Graham Packaging Co.:
0%/10.75% 2009(1) $750 510 $750 510
8.75% 2008 500 480 500 480
Reliance Industries Ltd.:
10.25% 2097(2) 500 440 500 429
Series B, 10.25% 2097 250 220 250 215
Wharf International Finance Ltd., Series A, 515 478 515 466
7.625% 2007
Hutchison Whampoa Finance (CI) Ltd., 300 281 300 283
Series D, 6.988% 2037(2)
ENERGY SOURCES - 2.18%/2.21%
Petrozuata Finance, Inc.:
Series B, 8.22% 2017(2) 1,500 1,117 1,500 1,129
Series A, 7.63% 2009(2) 1,000 805 1,000 796
Union Pacific Resources Group Inc. 7.30% 2009 840 807 840 814
USX Corp. 6.65% 2006 1,000 949 1,000 959
PDVSA Finance Ltd.:
7.40% 2016 485 357 485 369
9.75% 2010(2) 250 235 250 244
Norcen Energy Resources Ltd. 7.375% 2006 500 487 500 490
Louis Dreyfus Natural Gas Corp. 9.25% 2004 500 507 500 508
Pioneer Natural Resources Co. 7.20% 2028 375 273 375 278
Asset-Backed Obligations - 2.15%/2.01%
ComEd Transitional Funding Trust, Transitional
Funding Trust Notes:
Series 1998, Class A-4, 5.39% 2005 2,000 1,919 2,000 1,930
Series 1998, Class A-6, 5.63% 2009 500 464 500 468
Conseco Finance Home Loan Trust, Series 1,250 1,242 1,250 1,253
1999-G, Class B-2, 10.96% 2029
Sears Credit Account Master Trust II, 1,000 937 1,000 945
Series 1998-2, Class A, 5.25% 2008
FIRSTPLUS Home Loan Owner Trust, 500 495 500 496
Series 1997-1, Class A-6, 6.95% 2015
Green Tree Financial Corp., pass through 499 414 - -
certificates, Series 1996-5, Class B-2, 8.45% 2027
FOREST PRODUCTS & PAPER - 2.07%/2.00%
Pindo Deli Finance Mauritius Ltd.:
10.75% 2007 1,450 1,055 1,450 1,026
10.25% 2002 500 396 500 376
Kappa Beheer BV 10.625% 2009(2) EUR 750 796EUR 1250 1,309
Container Corp. of America 9.75% 2003 $1,000 1,020 $1,000 1,020
Fort James Corp. 6.625% 2004 500 482 500 486
Packaging Corp. of America 9.625% 2009 375 383 375 387
Pacifica Papers 10.00% 2009 250 258 250 258
Scotia Pacific Co. LLC, Series B, Class A-2, 1000 874 250 206
7.11% 2028
INDUSTRIAL COMPONENTS - 1.62%/1.64%
Federal-Mogul Corp.:
7.375% 2006 2,000 1,826 2,000 1,841
7.75% 2006 1,000 926 1,000 935
7.50% 2009 1,000 886 1,000 894
TRW Inc. 7.125% 2009(2) 500 473 500 480
BREED Technologies, Inc. 9.25% 2008(3) 1,000 15 1,000 15
INSURANCE - 1.63%/1.61%
Lindsey Morden Group Inc., Series B, 7.00% 2008(2) C$2,750 1,702 C$2,750 1,679
Royal & Sun Alliance Insurance Group PLC $750 766 $750 759
8.95% 2029(2)
Conseco, Inc. 9.00% 2006 750 773 750 747
Jefferson Pilot Corp. 8.14% 2046(2) 700 645 700 649
ReliaStar Financial Corp. 8.00% 2006 250 251 250 255
UTILITIES: ELECTRIC & GAS - 1.33%/1.50%
Israel Electric Corp. Ltd.(2):
7.70% 2018 1,000 888 1,000 880
7.75% 2027 620 536 620 547
8.25% 2009 400 399 400 397
7.75% 2009 250 241 250 241
Transener SA 9.25% 2008(2) 1,000 873 1,000 872
Commonwealth Edison Co. 9.875% 2020 400 431 400 441
United Utilities PLC 6.875% 2028 - - 500 425
HEALTH CARE PROVIDERS & SERVICES - 1.19%/1.20%
Columbia/HCA Healthcare Corp.:
6.91% 2005 2,000 1,830 2,000 1,816
8.85% 2007 500 489 500 491
7.15% 2004 500 470 500 471
Integrated Health Services, Inc.(3):
Series A, 9.25% 2008 2,000 165 2,000 180
Series A, 9.50% 2007 750 62 750 68
BUSINESS SERVICES - 1.47%/0.99%
Waste Management, Inc.:
6.625% 2002 925 862 925 844
6.875% 2009(2) 500 421 500 414
Allied Waste North America, Inc. 10.00% 2009(2) 1,625 1,450 1,375 1,256
Cendant Corp. 7.75% 2003 1,000 998 - -
MERCHANDISING - 0.26%/0.63%
Federated Department Stores, Inc. 6.30% 2009 - - 1,000 919
J. C. Penney Co., Inc. 8.25% 2022 750 667 750 679
FOOD & HOUSEHOLD PRODUCTS - 0.52%/0.53%
Gruma, SA de CV 7.625% 2007 1,000 870 1,000 878
New World Pasta Co. 9.25% 2009 250 231 250 230
Fage Dairy Industry SA 9.00% 2007 250 220 250 225
MACHINERY & ENGINEERING - 0.48%/0.48%
Safety-Kleen Corp. 9.25% 2009 1,000 968 1,000 963
Deere & Co. 8.95% 2019 250 261 250 264
ENERGY EQUIPMENT & SERVICES - 0.45%/0.45%
McDermott Inc. 9.375% 2002 1,150 1,149 1,150 1,146
HEALTH & PERSONAL CARE - 0.42%/0.40%
Paracelsus Healthcare Corp. 10.00% 2006 1,000 580 1,000 528
Allegiance Corp. 7.00% 2026 500 486 500 483
CHEMICALS - 0.29%/0.29%
Equistar Chemicals, LP 8.75% 2009 750 741 750 744
ELECTRONIC COMPONENTS - 0.57%/0.24%
Hyundai Semiconductor America, Inc. 8.625% 2007(2) 1750 1455 750 609
APPLIANCES & HOUSEHOLD SERVICES - 0.20%/0.20%
Salton/Maxim Housewares, Inc. 10.75% 2005 500 515 500 510
IT CONSULTING & SERVICES - 0.19%/0.19%
Ceridian Corp. 7.25% 2004 500 483 500 488
MISCELLANEOUS MATERIALS & COMMODITIES - 0.19%/0.18%
Printpack, Inc. 10.625% 2006 500 483 500 466
METALS: NONFERROUS - 0.18%/0.18%
Freeport-McMoRan Copper & Gold Inc.:
7.20% 2026 500 378 500 378
7.50% 2006 100 73 100 74
ELECTRICAL & ELECTRONICS - 0.16%/0.17%
Zilog, Inc. 9.50% 2005 450 414 450 421
REAL ESTATE INVESTMENT TRUST - 0.09%/0.09%
ProLogis Trust 7.05% 2006 250 236 250 238
NON U.S. GOVERNMENT OBLIGATIONS - 3.03%/3.24%
Hellenic Republic 8.60% 2008 GRD475,00 1,644GRD475,00 1,629
Argentina (Republic of):
Series C, 0% 2001 $1,250 1,050 $1,250 1,048
11.00% 2005 500 489 500 474
Panama (Republic of) 8.875% 2027 1,750 1,474 1,750 1,457
Philippines (Republic of) 9.875% 2019 500 496 1,000 1,020
Ontario (Province of) 5.50% 2008 1,000 886 1,000 901
Canadian Government 4.599% 2026(5) C$1,000 767 C$1,000 748
Hungarian Government 15.00% 2001 HUF105,00 435HUF105,00 427
Venezuela (Republic of) Eurobond 6.313% 2007(6) $381 301 $405 317
Mendoza (Province of) 10.00% 2007(2) 200 157 200 151
FEDERAL AGENCY OBLIGATIONS: MORTGAGE
PASS-THROUGHS - 6.56%/6.70%
Government National Mortgage Assn.:
7.00% 2023-2029 4,628 4,479 4,652 4,551
6.00% 2029 3,453 3,140 3,463 3,199
8.00% 2023 1,976 1,996 2,004 2,036
6.50% 2025-2028 1,081 1,015 1,095 1,042
7.50% 2023-2024 1,012 1,005 1,015 1,016
10.00% 2019 345 372 352 381
9.50% 2021 332 352 341 362
Fannie Mae:
7.00% 2012-2026 1,706 1,666 1,721 1,697
6.50% 2013-2026 1,042 1,006 1,046 1,019
6.00% 2013 861 817 864 827
10.00% 2018-2025 471 504 479 515
9.00% 2021 303 316 309 323
FEDERAL AGENCY OBLIGATIONS: OTHER
- 4.14%/1.59%
Freddie Mac:
5.125%-6.60% 2004-2009 8,500 7,881 4,500 4,031
Fannie Mae 5.25% 2009 3,000 2,646 - -
U.S. TREASURY OBLIGATIONS - 6.10%/9.70%
6.25% 2003 8,000 7,976 14,250 14,308
7.50% 2005-2016 1,000 1,070 4,000 4,257
10.375% 2009-2012 1,500 1,791 1,500 1,817
8.875% 2017 2,575 3,112 1,325 1,632
7.25% 2004 1,500 1,547 1,500 1,564
5.75% 2002 - - 1,000 992
---------- ----------
TOTAL BONDS & NOTES (cost: $218,866,000 205,221 208,936
and $222,255,000 respectively)
---------- ----------
Number of
Shares or
Principal
Stocks (common and preferred) Amount
-------------------------------------------- --------
BANKING - 3.06%/3.23%
Fuji JGB Investment LLC, Series A, 9.87% $2,100 $2,100 $2,350 $2,371
noncumulative preferred(Japan)(2)
SB Treasury Co. LLC, Series A, 9.40% $1,500 1,493 $1,500 1,523
noncumulative preferred(Japan)(2)
BNP U.S. Funding LLC, Series A, 7.738% $1,550 1,443 $1,550 1,443
noncumulative preferred(France)(2)
Tokai Preferred Capital Co. LLC, Series A,
9.98%/11.09% noncumulative preferred(Japan)(1)(2) $1,250 1,245 $1,250 1,269
First Republic Capital Corp. 10.50% preferred(2) 750 686 750 722
NB Capital Corp. 8.35% exchangeable depositary 20,000 430 20,000 463
IBJ Preferred Capital Co. LLC, Series A, $400 378 $400 382
8.79% noncumulative preferred(Japan)(2)
WIRELESS TELECOMMUNICATION SERVICES - 0.75%/0.70%
Crown Castle International Corp. 1,133 1,173 1,098 1,143
12.75% Senior Exchangeable Preferred 2010 (8)(9)
Nextel Communications, Inc.,
Series D, 13.00% exchangeable preferred 328 348 328 348
redeemable 2009 (8)(9)
McCaw International, Ltd. (owned by Nextel 2,000 5 2,000 5
Communications, Inc.) warrants, expire 2007
(2)(4)(9)
Esat Holdings Ltd., warrants, expire 2007 2,000 367 2,000 261
(Ireland)(2)(4)(9)
Globalstar Telecommunications Ltd., warrants, 250 13 250 16
expire 2004(9)
Conecel Holdings Ltd., Class B, warrants, 15,500 1 15,500 1
expire 2000 (Ecuador)(2)(4)(9)
Iridium World Communications Ltd. warrants, 250 - 250 -
expire 2005 (Bermuda)(2)(4)(9)
MULTI-INDUSTRY - 0.52.%/0.50%
Swire Pacific Capital Ltd. 65,000 1,316 65,000 1,268
8.84% cumulative guarantedd perpetual
capital securities (2)
REAL ESTATE - 0.41%/0.43%
ProLogis Trust, Series D, 7.92% preferred 40,000 730 40,000 770
CarrAmerica Realty Corp., Series B, 8.57% 20,000 323 20,000 314
cumulative redeemable preferred
BROADCASTING & PUBLISHING - 0.23%/0.23%
Adelphia Communications Corp., Series B, 5,000 550 5,000 564
13.00% 2009 (9)
NTL Inc., warrants, expire 2008 (2)(4)(9) 238 31 238 22
TVN Entertainment Corp., warrants, 300 - 300 -
expires 2008(2)(4)(9)
DIVERSIFIED TELECOMMUNICATION SERVICES
- 0.16%/0.11%
COLT Telecom Group PLC (ADR)(United Kingdom)(9) 1,950 398 1,950 291
RECREATION OTHER CONSUMER PRODUCTS
- 0.00%/0.00%
V2 Music Holdings PLC, warrants, expire 2000 575 - 575 -
(United Kingdom)(2)(9)
---------- ----------
TOTAL STOCKS (cost: $11,954,000 and 13,030 13,176
$12,169,000 respectively)
---------- ----------
Principal
Amount
Convertible Debentures (000)
-------------------------------------------- --------
DIVERSIFIED TELECOMMUNICATION SERVICES
- 1.27%/1.37%
Bell Atlantic Financial Services, Inc.:
4.25% convertible debentures 2005(2) 2,000 2,460 2,500 2,719
5.75%,convertible debentures 2003(2) 750 758 750 744
BUSINESS SERVICES - 0.57%/0.56%
USA Waste Services, Inc. 4.00% 2002 $1,400 1,190 $1,400 1,169
EarthWatch Inc., Series B, 7.00% convertible 72 250 72 250
preferred 2009(4)(8)(9)
WHOLESALE & INTERNATIONAL TRADE
- 0.24%/0.24%
Ingram Micro Inc. 0% convertible debentures 2018 1,900 618 1,900 610
ELECTRONIC COMPONENTS - 0.25%/0.23%
Advanced Micro Devices, Inc. 6.00% convertible 625 638 625 591
subordinated notes 2005
MERCHANDISING - 0.19%/0.19%
Sunglass Hut International Ltd. 5.25% 600 483 600 483
convertible debentures 2003
---------- ----------
TOTAL CONVERTIBLE DEBENTURES (cost: 6,397 6,566
$5,904,000 and $6,379,000 respectively)
---------- ----------
TOTAL EQUITY SECURITIES (cost: 19,427 19,742
$17,858,000 and $18,548,000 respectively)
---------- ----------
Short-Term Securities
--------------------------------------------
Corporate Short-Term Notes - 10.23%/7.14%
Associates Corp. of North America 5.71% - - 7,700 7,699
due 12/1/1999
Wal-Mart Stores Inc. 5.48%-5.53% due - - 7,200 7,178
12/20-12/21/1999 (2)
E.I. du Pont de Nemours and Co. 5.29% due 12/3/1999 - - 3,200 3,198
Associats First Capital Corp. 4.00% due 1/3/2000 6,060 6,058 - -
Avon Capital Corp. 6.70% due 1/6/2000 (2) 4,000 3,995 - -
Equilon Enterprises, LLC 6.25% 1/10/2000 4,000 3,993 - -
Halliburton Co. 6.30% 1/4/2000 7,000 6,995 - -
John Hancock Capital Corp. 5.90% 1/4/2000 (2) 5,000 4,997 - -
Federal Agency Discount Notes - 0.00%/0.87%
Freddie Mac 5.30% due 12/10/1999 - - 2,200 2,197
---------- ----------
TOTAL SHORT-TERM SECURITIES (cost: 26,038 20,272
$26,038,000 and $20,272,000 respectively)
---------- ----------
TOTAL INVESTMENT SECURITIES (cost: 250,686 248,950
$262,762,000 and $261,075,000 respectively)
Excess of cash and receivables over payables 3,548 4,367
---------- ----------
NET ASSETS $254,234 $253,317
========== ==========
(1) Step bond; coupon rate will increase at a later date.
(2) Purchased in a private placement transaction;
resale to the public may require registration
or sale only to qualified institutional buyers.
(3) Company not making interest or dividend
payments; bankruptcy proceedings pending.
(4) Valued under procedures established by
the Board of Trustees.
(5) Index-linked bond whose principal amount moves
with agovernment retail price index.
(6) Coupon rate may change periodically.
(7) Pass-through securities backed by a pool of
mortgages or other assets on which principal
payments are periodically made. Therefore, the
effective maturity is shorter than the stated maturity.
(8) Payment in kind; the issuer has the option of
paying additional securities in lieu of cash.
(9) Non-income-producing security.
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series High Yield Bond Fund
Investment Portfolio, December 31 and November 30, 1999
<S> <C> <C> <C> <C>
31-Dec 30-Nov
Percent oPercent of
net assetnet assets
Corporate Bonds 78.01% 77.90%
Non-U.S. Govt Agencies 1.61% 1.56%
Equity Securities 14.75% 13.65%
Cash & Equivalents 5.63% 6.89%
100.00% 100.00%
Nextel Communications 4.46 4.59
Omnipoint 4.68 4.47
COLT Telecom 4.46 3.73
NTL 3.56 3.56
Charter Communications 1.97 2.03
Crown Castle International 2.05 2.01
Viatel 1.71 1.99
Clearnet Communications 1.94 1.89
Chancellor Media Corp of Los Angeles 1.78 1.75
Container Corp. of America 1.73 1.74
Principal Market Principal Market
Amount Value Amount Value
BONDS & NOTES (000) (000) (000) (000)
-------------------------------------------- -------- -------- -------- --------
WIRELESS TELECOMMUNICATION SERVICES
- 19.50%/19.05%
Omnipoint Corp.:
11.625% 2006 $12,700 $13,462 $12,700 $13,462
14.00% 2003 (1)(2)(3) 9,996 10,476 9,342 9,903
9.40%-10.479% 2006 (1)(4) 5,000 4,975 5,000 4,850
Nextel Communications, Inc.(5):
0%/9.95% 2008 11,000 7,728 11,000 7,755
0%/10.65% 2007 6,500 4,859 6,500 4,891
0%/9.75% 2007 3,000 2,137 3,000 2,152
McCaw International, Ltd. (owned by Nextel
Communications, Inc.) 0%/13.00% 2007 (5) 7,000 4,830 7,000 4,655
Nextel International, Inc. 0%/12.125% 2008 (5) 6,000 3,540 6,000 3,300
Nextel Partners Inc. 0%/14.00% 2009 (5) 1,600 1,048 350 227
Clearnet Communications Inc.(5):
0%/11.75% 2007 C$20,825 10,261C$20,825 9,962
0%/10.40% 2008 7,000 3,062 7,000 2,957
American Cellular Corp. 10.50% 2008 $7,850 8,694 $7,850 8,714
SpectraSite Holdings, Inc.(5):
0%/11.25% 2009 7,875 4,213 7,875 4,016
0%/12.00% 2008 5,250 3,098 5,250 2,993
Esat Telecom Group PLC:
0%/12.50% 2007 (5) 5,125 4,356 5,125 3,844
11.875% 2008 2,750 3,059 2,750 2,943
PageMart Wireless, Inc. 0%/11.25% 2008 (5) 21,650 7,361 21,650 6,712
Crown Castle International Corp.(5):
0%/11.25% 2011 (1) 6,000 3,750 6,000 3,720
0%/10.625% 2007 3,500 2,642 3,500 2,625
CTI Holdings SA 0%/11.50% 2008 (5) 10,500 6,064 10,500 5,801
VoiceStream Wireless Corp.(1):
0%/11.875% 2009 (5) 7,500 4,538 7,500 4,556
10.375% 2009 1,000 1,030 1,000 1,042
Dobson Communications Corp. 11.75% 2007 2,750 3,101 2,750 3,080
Comunicacion Celular SA 0%/14.125% 2005 (1)(5) 5,000 2,394 5,000 2,531
Centennial Cellular Corp. 10.75% 2008 2,250 2,419 2,250 2,396
Occidente y Caribe Celular SA 0%/14.00% 2004 (5) 3,700 1,660 3,700 2,007
Telesystem International Wireless Inc. 2,450 1,568 3,450 1,984
0%/13.25% 2007 (5)
Loral Orion Network Systems, Inc. 11.25% 2007 2,400 1,800 2,400 1,776
Western Wireless Corp. 10.50% 2006 1,500 1,601 1,500 1,605
Teligent, Inc. 11.50% 2007 1,500 1,463 1,500 1,440
PTC International Finance BV 0%/10.75% 2007 (5) 2,000 1,345 2,000 1,365
Teletrac Holdings, Inc.(3):
9.00% 2004 492 394 492 394
senior note 10.00% 2000 116 116 116 116
Conecel Holdings Ltd.(6):
14.00% 2002 750 229 750 182
14.00% 2000(1)(3) 1,000 100 1,000 100
Cellco Finance NV 15.00% 2005(1) 250 272 250 263
BROADCASTING & PUBLISHING - 18.54%/18.56%
Comcast UK Cable Partners Ltd. 0%/11.20% 2007 (5) 10,000 9,500 10,000 9,400
NTL Inc.:
0%/10.75% 2008 (5) L7,250 7,730 L7,250 7,870
0%/9.75% 2008 (5) $5,500 3,836 $5,500 3,754
11.50% 2008 1,500 1,620 1,500 1,627
Series B, 10.00% 2007 1,500 1,537 1,500 1,534
Charter Communications Holdings, LLC:
0%/9.92% 2011(5) 17,500 10,237 17,500 10,587
8.25% 2007 3,500 3,255 3,500 3,308
Chancellor Media Corp. of Los Angeles:
Series B, 8.75% 2007 6,000 6,120 6,000 6,000
8.125% 2007 4,500 4,511 4,500 4,455
9.375% 2004 1,500 1,549 1,500 1,526
Fox/Liberty Networks, LLC, FLN Finance, Inc.:
0%/9.75% 2007 (5) 8,085 6,468 8,085 6,428
8.875% 2007 4,410 4,487 4,410 4,498
American Media Operations, Inc. 10.25% 2009 6,650 6,733 6,650 6,584
ACME Intermediate Holdings, LLC 0%/12.00% 2005 (5) 8,911 6,327 8,911 6,238
Ziff-Davis Inc. 8.50% 2008 6,000 6,248 6,000 5,880
Gray Communications Systems, Inc. 10.625% 2006 5,250 5,421 5,250 5,408
Muzak Holdings LLC 0%/13.00% 2010(5) 6,500 3,867 6,500 3,770
Muzak LLC 9.875% 2009 1,000 972 1,000 963
Big City Radio, Inc. 0%/11.25% 2005 (5) 6,000 4,020 6,000 4,095
Globo Comunicacoes Partcipacoes Ltda.:
10.50% 2006(1) 2,750 2,386 2,750 2,289
10.50% 2006 1,000 867 1,000 832
FrontierVision 11.00% 2006 2,750 2,901 2,750 2,901
Avalon Cable of Michigan LLC:
9.375% 2008 2,500 2,519 2,500 2,513
0%/11.875% 2008(5) 500 326 500 330
Cablevision Industries Corp. 9.875% 2013 2,500 2,637 2,500 2,606
TVN Entertainment Corp. 14.00% 2008 (1) 6,500 1,820 6,500 2,600
Antenna TV SA 9.00% 2007 2,750 2,530 2,750 2,530
Multicanal Participacoes SA, Series B, 12.625% 2004 2,375 2,399 2,375 2,399
V2 Music Holdings PLC:
0%/14.00% 2008(1)(5) 6,900 1,863 6,900 1,863
0%/14.00% 2008(1)(5) L1,000 436 L1,000 431
TransWestern Publishing Co. LLC 9.625% 2007 $2,250 2,233 $2,250 2,182
TeleWest Communications PLC 9.625% 2006 2,000 2,035 2,000 2,040
Falcon Holding Group, LP, Falcon Funding Corp. 2,000 2,015 2,000 2,005
8.375% 2010
STC Broadcasting, Inc. 11.00% 2007 2,000 1,985 2,000 1,990
Telemundo Holdings, Inc. 0%/11.50% 2008 (5) 2,500 1,488 2,500 1,425
RBS Participacoes SA 11.00% 2007(1) 1,000 848 1,000 797
Young Broadcasting Inc. 10.125% 2005 750 763 750 765
Sun Media Corp. 9.50% 2007 325 322 325 323
Cumulus Media Inc. 10.375% 2008 250 261 250 261
DIVERSIFIED TELECOMMUNICATION SERVICES
- 8.61%/8.88%
Viatel, Inc.:
11.25% 2008 3,300 3,284 5,550 5,495
0%/12.50% 2008 (5) 7,000 4,393 7,000 4,270
11.15% 2008 DM6,000 3,094 DM6,000 3,027
0%/12.40% 2008 (5) 1,000 334 1,000 324
COLT Telecom Group PLC:
0%/12.00% 2006 (5) $11,250 9,900 $11,250 9,675
8.875% 2007 DM5,000 2,765 DM5,000 2,754
NEXTLINK Communications, Inc.:
9.625% 2007 $3,500 3,439 $3,500 3,412
9.00% 2008 3,000 2,843 3,000 2,827
0%/12.25% 2009(5) 3,500 2,223 3,500 2,117
0%/12.125% 2009(1)(5) 2,750 1,602 2,750 1,554
12.50% 2006 1,000 1,080 1,000 1,070
Time Warner Telecom Inc. 9.75% 2008 7,625 7,816 7,625 7,854
US Xchange, LLC 15.00% 2008 4,625 3,608 4,625 3,839
Allegiance Telecom, Inc.:
0%/11.75% 2008 (5) 4,250 3,033 4,250 3,018
12.875% 2008 625 706 625 694
Global TeleSystems Group, Inc. 9.875% 2005 3,600 3,294 3,600 3,312
GST Equipment Funding, Inc. 13.25% 2007 3,000 2,970 3,000 3,000
IMPSAT Corp. 12.375% 2008 1,750 1,562 1,750 1,435
Versatel Telecom International NV 11.875% 2009 EUR 1,000 1,076EUR 1,000 1,057
LEISURE & TOURISM - 5.71%/5.95%
Horseshoe Gaming Holdings Corp. 8.625% 2009 $ 8,00 7,640 $ 8,00 7,700
William Hill Finance 10.625% 2008 3,550 5,878 3,550 5,922
Premier Parks Inc.:
9.75% 2007 2,625 2,671 2,625 2,665
0%/10.00% 2008 (5) 2,500 1,713 2,500 1,700
Boyd Gaming Corp.:
9.25% 2003 3,250 3,291 3,250 3,283
9.50% 2007 1,000 990 1,000 985
AMF Bowling Worldwide, Inc.:
10.875% 2006 3,500 1,470 4,250 2,380
0%/12.25% 2006 (5) 2,751 880 2,751 1,265
Sun International Hotels Ltd., Sun International
North America, Inc.:
8.625% 2007 2,250 2,115 2,250 2,093
9.00% 2007 750 724 750 712
International Game Technology 7.875% 2004 2,800 2,702 2,800 2,730
Carmike Cinemas, Inc., Series B, 9.375% 2009 2,750 2,406 2,750 2,626
Harrah's Operating Co., Inc. 7.875% 2005 2,275 2,190 2,275 2,198
Six Flags Entertainment Corp. 8.875% 2006 2,000 1,955 2,000 1,960
KSL Recreation Group, Inc. 10.25% 2007 1,250 1,250 1,250 1,231
Friendly Ice Cream Corp. 10.50% 2007 925 786 925 800
Florida Panthers Holdings, Inc. 9.875% 2009 500 495 500 480
FOREST PRODUCTS & PAPER - 3.47%/3.97%
Container Corp. of America:
9.75% 2003 9,600 9,792 9,600 9,792
Series A, 11.25% 2004 2,000 2,070 2,000 2,080
Kappa Beheer BV:
0%/12.50% 2009(1)(5) 4,750 2,999 4,750 2,930
10.625% 2009(1) 1,500 1,592 1,500 1,578
Paperboard Industries International Inc. 8.375% 2007 1,250 1,188 4,000 3,680
Indah Kiat Finance Mauritius Ltd.:
11.875% 2002 2,300 2,035 2,300 1,984
10.00% 2007 250 186 250 178
Advance Agro PCL 13.00% 2007 3,200 2,064 3,200 2,096
Pacifica Papers Inc. 10.00% 2009 - - 1,000 1,030
Pindo Deli Finance Mauritius Ltd. 10.75% 2007 1,300 946 1,300 920
Copamex Industrias, SA de CV, Series B, 11.375% 2004 1,000 907 1,000 908
FOOD & HOUSEHOLD PRODUCTS - 2.91%/3.01%
Fage Dairy Industry SA 9.00% 2007 10,500 9,240 10,500 9,450
Home Products International, Inc. 9.625% 2008 7,500 6,844 7,500 6,769
Salton/Maxim Housewares, Inc. 10.75% 2005 3,125 3,219 3,125 3,187
DGS International Finance Co. 10.00% 2007(1) 1,250 641 2,000 1,205
MULTI-INDUSTRY - 2.50%/2.48%
Graham Packaging Co.:
0%/10.75% 2009 (5) 6,500 4,420 6,500 4,420
8.75% 2008 4,250 4,080 4,250 4,080
Tekni-Plex, Inc. 9.25% 2008 5,500 5,638 5,500 5,500
Wharf International Finance Ltd. 7.625% 2007 3,000 2,786 3,000 2,712
Reliance Industries Ltd. 10.50% 2046(1) 250 238 250 236
BUSINESS SERVICES - 3.04%/2.74%
Allied Waste North America, Inc. 10.00% 2009(1) 8,875 7,921 8,375 7,653
Safety-Kleen Services, Inc. 9.25% 2008 7,375 7,135 7,375 7,228
EarthWatch Inc. 0%/12.50% 2005(1)(3)(5) 2,880 1,925 2,880 1,905
Iron Mountain Inc.:
10.125% 2006 1,500 1,530 1,500 1,549
8.75% 2009 350 336 350 331
Stericycle Inc. 12.375% 2009(1) 1,000 1,020 1,000 1,015
Waste Management, Inc. 7.70% 2002 1,000 958 1,000 944
BEVERAGES & TOBACCO - 1.66%/1.67%
Delta Beverage Group, Inc. 9.75% 2003 6,200 6,200 6,200 6,200
Canandaigua Wine Co., Inc.:
Series C, 8.75% 2003 3,750 3,741 3,750 3,741
8.75% 2003 1,500 1,466 1,500 1,470
ELECTRONIC COMPONENTS - 1.76%/1.48%
Flextronics International Ltd. 8.75% 2007 4,500 4,410 4,500 4,466
Samsung Electronics Co., Ltd.(1):
7.45% 2002 3,150 3,098 3,150 3,080
9.75% 2003 500 516 500 519
Advanced Micro Devices, Inc. 11.00% 2003 2,250 2,216 2,000 1,940
Fairchild Semiconductor Corp. 10.375% 2007 1,750 1,785 150 153
MISCELLANEOUS MATERIALS & COMMODITIES - 1.47%/1.47%
Printpack, Inc. 10.625% 2006 4,258 4,109 4,258 3,971
Anchor Glass Container Corp. 11.25% 2005 4,000 3,600 4,000 3,760
Impress Metal Packaging Holdings BV 9.875% 2007 DM4,750 2,370 DM4,750 2,323
ENERGY SOURCES - 1.71%/1.35%
Cross Timbers Oil Co.:
Series B, 9.25% 2007 $3,000 2,962 $3,000 2,970
8.75% 2009 1,000 945 1,000 965
Pogo Producing Co.:
8.75% 2007 2,500 2,406 2,500 2,413
10.375% 2009 1,250 1,300 1,250 1,306
Petrozuata Finance, Inc.(1):
Series B, 8.22% 2017 1,000 745 1,000 752
Series A, 7.63% 2009 800 644 800 637
Newfield Exploration Co., Series B, 7.45% 2007 250 227 250 231
HS Resources, Inc. 9.25% 2006 2,500 2481 - -
METALS: NONFERROUS - 0.88%/0.87%
Kaiser Aluminum & Chemical Corp. 12.75% 2003 2,350 2,350 2,350 2,332
Doe Run Resources Corp. 11.25% 2005 2,000 1,895 2,000 1,820
Freeport-McMoRan Copper & Gold Inc. 7.20% 2026 2,400 1,813 2,400 1,815
BANKING - 0.71%/0.71%
Advanta Corp.:
Series D, 6.98% 2002 2,000 1,826 2,000 1,824
Series D, 6.925% 2002 2,000 1,824 2,000 1,822
7.50% 2000 500 495 500 494
Komercni Finance BV 9.00%/10.75% 2008(1)(5) 750 699 750 701
HEALTH & PERSONAL CARE - 1.67%/1.69%
Paracelsus Healthcare Corp. 10.00% 2006 13,000 7,540 13,000 6,857
Integrated Health Services, Inc.(6):
Series A, 9.25% 2008 9,250 763 9,250 832
Series A, 9.50% 2007 5,325 439 5,325 479
10.25% 2006 5,000 412 5,000 450
Tenet Healthcare Corp. 8.00% 2005 1,500 1,448 1,500 1,436
Sun Healthcare Group, Inc.(6):
9.375% 2008 (1) 8,000 560 8,000 1,000
Series B, 9.50% 2007 2,925 205 2,925 366
Mariner Health Group, Inc. 9.50% 2006 (6) 8,100 81 8,100 162
MERCHANDISING - 0.51%/0.52%
Kmart Corp., Series K-2, 9.78% 2020 2,000 2,052 2,000 2,050
DR Securitized Lease Trust, pass-through certificates, 1,500 1,474 1,500 1,474
Series 1994 K-2. 9.35% 2019 (7)
TRANSPORTATION: SHIPPING - 0.47%/0.47%
Teekay Shipping Corp. 8.32% 2008 3,500 3,211 3,500 3,185
ELECTRICAL & ELECTRONICS - 0.50%/0.44%
Zilog, Inc. 9.50% 2005 3,750 3,450 3,250 3,039
FINANCIAL SERVICES - 0.63%/0.44%
Providian Financial Corp. 9.525% 2027 (1) 3,500 2,966 3,500 3,014
GS Escrow Corp. 7.125% 2005 1,500 1,348 - -
RECREATION & OTHER CONSUMER PRODUCTS
- 0.44%/0.44%
Boyds Collection, Ltd. 9.00% 2008 3,137 2,980 3,137 2,980
AUTOMOBILES - 0.47%/0.57%
Key Plastics Holdings, Inc. 10.25% 2007 3,000 1,290 3,000 1,950
Hayes Lemmerz International, Inc., Series B, 2,000 1,820 2,000 1,835
8.25% 2008
BREED Technologies, Inc. 9.25% 2008 (6) 7,375 111 7,375 111
TRANSPORTATION: AIRLINES - 0.21%/0.21%
USAir, Inc., pass-through trust, Series 1993-A3, 1,500 1,440 1,500 1,431
10.375% 2013 (7)
TEXTILES & APPAREL - 0.20%/0.21%
WestPoint Stevens Inc. 7.875% 2005 1,500 1,365 1,500 1,421
COLLATERALIZED MORTGAGE OBLIGATIONS
(PRIVATELY ORIGINATED) - 0.18%/0.19%
Chase Commercial Mortgage Securities Corp., 1,522 1,258 1,522 1,266
Series 1998-2, Class E, 6.39% 2030 (7)
ENERGY EQUIPMENT & SERVICES - 0.15%/0.15%
McDermott Inc. 9.375% 2002 1,000 999 1,000 997
REAL ESTATE INVESTMENT TRUST - 0.10%/0.10%
FelCor Suites LP 7.375% 2004 750 682 750 682
NON U.S. GOVERNMENTS & GOVERNMENTAL
AUTHORITIES - 1.61%/1.56%
United Mexican States Government Eurobonds:
Global, 11.375% 2016 2,250 2,551 2,250 2,477
Global, 11.50% 2026 500 595 500 582
Panama (Republic of):
Interest Reduction Bond, 3.75% 2014(1)(4) 3,000 2,355 3,000 2,228
8.875% 2027 250 211 250 208
Argentina (Republic of):
11.75% 2009 830 828 830 803
11.00% 2006 725 721 725 694
9.75% 2027 800 722 800 668
11.375% 2017 250 249 250 234
Philippines (Republic of):
8.875% 2008 1,750 1,715 1,750 1,722
9.875% 2019 500 496 500 510
Bulgaria (Republic of), Front-Loaded Interest 445 322 445 313
Reduction Bond, 2.75% 2012 (4)
Turkey (Republic of) 12.375% 2009 250 269 250 262
TOTAL BONDS & NOTES (cost: $623,539,000 545,656 543,573
and $622,182,000 respectively)
======== ========
Number of Number of
Shares or Shares or
Stocks (Common & Preferred) Principal Principal
-------------------------------------------- Amount Amount
WIRELESS TELECOMMUNICATION SERVICES
- 5.16%/5.19%
Nextel Communications, Inc.:
Series E, 11.125% exchangeable preferred, 13,548 13,548 14,374 14,374
redeemable 2010 (2)(8)
Series D, 13.00% exchangeable preferred, 2,132 2,260 2,132 2,260
redeemable 2009 (2)(8)
McCaw International, Ltd. (owned by Nextel
Communications, Inc.) warrants, expire 2007 (1)(3)(8) 2,500 6 2,500 6
Dobson Communications Corp.(2)(8):
12.25% exchangeable preferred, redeemable 2008 4,660 4,660 4,519 4,700
12.25% senior exchangeable preferred, redeemable 2008 3,872 3,873 3,756 3,906
Crown Castle International Corp. 12.75% preferred 2010 7,369 7,627 7,142 7,431
Omnipoint Corp.(8) 14,893 1,797 14,893 1,206
Omnipoint Corp. 7.00% convertible preferred 8,000 1,336 8,000 1,160
Comunicacion Celular SA, Class B, warrants, 5,000 1 5,000 275
expire 2003 (Colombia)(1)(8)
Esat Telecom Group PLC, warrants, expire 2007 1,250 229 1,250 163
(Ireland) (1)(3)(8)
Conecel Holdings Ltd., Class B, warrants, 25,900 3 25,900 3
DIVERSIFIED TELECOMMUNICATION SERVICES - 2.97%/2.25%
COLT Telecom Group (ADR) (United Kingdom)(8) 87,750 17,901 87,750 13,086
IXC Communications, Inc. (2)(8) 1,647 1,812 1,647 1,812
Viatel, Inc. (8) 11,371 610 11,371 478
KMC Telecom Holdings Inc., warrants, expire 2008 (1)(8 9,500 28 9,500 28
BROADCASTING & PUBLISHING - 2.10%/1.97%
ACME Communications, Inc. (8) 106,579 3,544 106,579 3,604
Cumulus Media Inc. 13.75% preferred 2009 (2) 2,732 3,074 2,732 3,033
Radio One, Inc., Class A (8) 33,700 3,100 37,500 2,370
Price Communications Corp. (8) 78,238 2,176 90,538 2,269
Clear Channel Communications, Inc. (8) 25,506 2,276 25,506 2,050
NTL Inc., warrants, expire 2008 1,425 188 1,425 132
(United Kingdom-Incorporated in USA) (1)(3)(8)
TVN Entertainment Corp., warrants, expire 2008 (1)(3)( 6,500 - 6,500 -
BANKING - 1.78%/1.81%
Chevy Chase Preferred Capital Corp. 10.375% 38,200 1,858 38,200 1,934
Fuji JGB Investment LLC, Series A, 9.87% 8,500 8,5008,500,000 8,575
noncumulative preferred (Japan)(1)
First Republic Capital Corp. 10.50% preferred (1) 2,000 1,830 2,000 1,925
BUSINESS SERVICES - 0.66%/0.63%
EarthWatch Inc.(2)(3)(8):
Series B, 7.00% convertible preferred 2009 896,976 3,000 869,976 3,000
Series C, 8.50% convertible preferred 2009 (1) 170,534 293 170,534 293
Verio Inc., warrants, expire 2004 (1)(8) 7,350 1195 7,350 935
Teletrac, Inc.(3)(8) 316,366 47 316,366 47
Teletrac, Inc., Class A, warrants, expire 2004 (3)(8) 116,490 12 116,490 12
MULTI-INDUSTRY - 0.47%/0.46%
Swire Pacific Capital Ltd. 8.84% cumulative guaranteed
perpetual capital securities (Hong Kong)(1) 160,000 3,240 160,000 3,120
FOREST PRODUCTS & PAPER - 0.30%/0.30%
Packaging Corp. of America 12.375% preferred 2010 (2)( 18,516 2,037 18,517 2,027
ENERGY SOURCES - 0.05%/0.06%
Cross Timbers Oil Co. 40,000 362 40,000 408
FINANCIAL SERVICES - 0.03%/0.03%
Wilshire Financial Services Group, Inc. (8) 155,212 213 155,212 194
APPLIANCES & HOUSEHOLD DURABLES
- 0.00%/0.00%
Protection One Alarm Monitoring, Inc., warrants, 6,400 2 6,400 1
expire 2005 (1)(3)(8)
RECREATION OTHER CONSUMER PRODUCTS
- 0.00%/0.00%
V2 Music Holdings, warrants, expire 2008 7,900 - 7,900 -
(United Kingdom)(1)(8)
TEXTILES & APPAREL - 0.00%/0.00%
Tultex Corp., warrants, expire 2007 (3)(8) 203,005 - 203,005 -
---------- ----------
TOTAL STOCKS (cost: $66,790,000 92,638 86,817
and $61,768,000 respectively)
======== ========
Principal Principal
Amount Amount
Convertible Debentures (000) (000)
-------------------------------------------- -------- -------- -------- --------
ELECTRONIC COMPONENTS - 0.36%/0.33%
Advanced Micro Devices, Inc. 6.00% 2005 2,400 2,448 2,400 2,268
MERCHANDISING - 0.25%/0.25%
Sunglass Hut International, Inc. 5.25% 2003 2,125 1,711 2,125 1,710
WHOLESALE & INTERNATIONAL TRADE - 0.23%/0.23%
Ingram Micro Inc. 0% 2018 4,905 1,594 4,905 1,576
WIRELESS TELECOMMUNICATION SERVICES - 0.13%/0.13%
Piltel International Holding Corp. 1.75% 2006 1,875 909 1,875 900
HEALTH CARE PROVIDERS & SERVICES - 0.01%/0.01%
Integrated Health Services, Inc. 5.75% 2001 3,500 70 3,500 70
---------- ----------
TOTAL CONVERTIBLE DEBENTURES 6,732 6,524
(cost: $10,515,000 and $10,488,000 respectively) ---------- ----------
Miscellaneous - 0.26%/0.00%
Other equity securities in initial period of acquisition 1,748 23
---------- ----------
TOTAL EQUITY SECURITIES (cost: $77,305,000 101,118 93,364
and $76,954,000 respectively)
---------- ----------
Short-Term Securities
--------------------------------------------
CORPORATE SHORT-TERM NOTES - 4.14%/4.04%
PACCAR Financial Corp. 5.27%-5.28% - - 7,800 7,790
due 12/8-12/10/1999
Bell Atlantic Network Funding Corp. 5.30% - - 6,600 6,587
due 12/13/1999
Halliburton Co. 5.27% due 12/21/1999 - - 5,400 5,383
H.J. Heinz Co. 5.28% due 12/2/1999 - - 5,000 4,999
Associates Corp. of North America 5.71% - - 2,900 2,900
due 12/1/1999
Pfizer Inc 5.87% due 2/7/2000 (1) 9,400 9,342 - -
Ford Motor Credit Co. 6.02% due 1/4/2000 5,000 4,996 - -
CIT Group Holdings, Inc. 4.75% due 1/3/2000 4,500 4,498 - -
Bell Atlantic Network Funding Corp. 6.05% 4,200 4,185 - -
due 1/21/2000
USAA Capital Corp 6.03% due 1/28/2000 4,100 4,080 - -
Gillette Co. 5.85% due 1/10/2000 (1) 1,300 1,298 - -
FEDERAL AGENCY DISCOUNT NOTES - 0.00%/1.21%
Freddie Mac 5.36% due 12/9/1999 - - 8,300 8,289
TOTAL SHORT-TERM SECURITIES (cost: 28,399 35,948
$28,400,000 and $35,948,000 respectively)
---------- ----------
TOTAL INVESTMENT SECURITIES (cost: 675,173 672,885
$729,244,000 and $735,084,000 respectively)
Excess of payables cash and receivables 10,153 11,192
NET ASSETS 685,326 684,077
1-Purchased in a private placement transaction;
resale to the public may require registration
or sale only to qualified institutional buyers.
2-Payment in kind.The issuer has the option
of paying additional securities in lieu of cash.
3-Valued under procedures established by the
Board of Trustees.
4-Coupon rate may change periodically.
5-Step bond-coupon; rate will increase at a later date.
6-Company not making interest payments,
bankruptcy proceedings pending.
7-Pass-through securities backed by a pool of
mortgages or other loans on which principal
payments are periodically made. Therefore,
the effective maturity is shorter than the
stated maturity
8-Non-income-producing security
ADR=American Depositary Receipts
See Notes to Financial Statements
</TABLE>
<TABLE>
U.S. Government Guaranteed/ AAA-Rated Securitites Fund
Investment Portfolio
<S> <C> <C> <C> <C>
December 31 November 30
------------------------------------------------ -------- -------- --------
PRIVATE MORTGAGE & ASSET-BACKED SECURITIES 37.52 37.47
FEDERAL AGENCY MORTGAGE-RELATED SECURITIES 32.93 33.94
U.S. TREASURY OBLIGATIONS 16.50 17.83
OTHER FEDERAL OBLIGATIONS 7.08 5.67
OTHER BONDS 2.60 2.59
CASH & EQUIVALENTS 3.37 2.50
------------------------------------------------ -------- -------- --------
December 31 November 30
Principal Market Principal Market
Amount Value Amount Value
Bonds & Notes (000) (000) (000) (000)
-------------------------------------------- -------- -------- -------- --------
Federal Agency Obligations: Mortgage
Pass-Throughs (1) - 29.46% / 30.50%
Government National Mortgage Assn.:
6.00% 2013-2029 $25,423 $23,358 $26,237 $24,457
7.00% 2023-2029 16,196 15,68 16,327 15,979
8.00% 2023-2027 9,500 9,59 9,645 9,802
7.50% 2022-2029 7,891 7,81 6,960 6,955
6.50% 2028-2029 5,815 5,45 5,842 5,557
8.50% 2021-2023 4,723 4,88 4,757 4,937
9.50% 2019-2021 2,413 2,55 2,417 2,570
10.00% 2019 1,378 1,48 1,407 1,523
5.50% 2013 974 90 979 920
9.00% 2009-2016 676 71 678 718
10.50% 2019 60 6 60 66
Fannie Mae:
6.00% 2013-2029 7,320 6,87 11,310 10,768
6.50% 2013-2028 9,190 8,84 9,252 8,983
7.00% 2012-2028 6,040 5,89 6,091 5,997
8.50% 2023-2027 4,543 4,67 4,633 4,789
7.50% 2029-2039 3,992 3,90 4,551 4,447
8.00% 2024 3,795 3,84 3,805 3,872
13.00% 2015 1,836 2,09 1,886 2,183
10.00% 2018 1,839 1,96 1,873 2,009
12.00% 2015-2019 1,719 1,92 1,749 1,965
5.50% 2014 1,892 1,75 1,909 1,787
9.00% 2011-2025 1,113 1,15 1,151 1,202
Freddie Mac:
6.00% 2014-2029 12,799 12,02 14,214 13,473
8.25% 2008-2009 2,157 2,18 2,227 2,270
5.50% 2013 1,832 1,70 1,840 1,723
7.00% 2008 1,361 1,35 1,389 1,388
8.00% 2012 1,187 1,20 1,235 1,259
8.50% 2018-2027 1,086 1,11 1,111 1,143
11.00% 2018 482 52 492 539
9.50% 2016 91 9 91 95
12.00% 2016 1 1 1
Freddie Mac Gold 9.00% 2022-2028 2,254 2,34 2,349 2,453
Collateralized Mortgage Obligations (Privately
Originated) (1) - 22.70% / 22.55%
Morgan Stanley Capital I, Inc.:
Series 1998-HF2, Class A-2, 6.48% 2030 7,500 7,05 7,500 7,155
Series 1997-HF1, Class A-1, 6.86% 2006 (2) 4,168 4,12 4,187 4,173
Series 1999-FNV1, Class A-2, 6.53% 2031 3,000 2,80 3,000 2,844
Series 1998-HF2, Class A-1, 6.01% 2030 2,783 2,64 2,801 2,687
Series 1998-WF2, Class A-1, 6.34% 2030 2,714 2,62 2,732 2,663
Series 1998-WF1, Class A-1, 6.25% 2030 2,383 2,31 2,394 2,339
Ocwen Residential MBS Corp., Series 1998-R1, 8,723 8,24 8,858 8,375
Class AWC, 3.985% / 3.213% 2040 (2,3)
GE Capital Mortgage Services, Inc. Series 1994-15, 8,000 7,20 8,000 7,282
Class A-10, 6.00% 2009
Nomura Asset Securities Corp., Series 1998-D6, 6,993 6,72 7,050 6,827
Class A-A1, 6.28% 2030
Deutsche Mortgage & Asset Receiving Corp., 6,698 6,43 6,789 6,576
Series 1998-C1, Class A-1, 6.22% 2007
Merrill Lynch Mortgage Investors, Inc.:
Series 1998-C3, Class A-1, 5.65% 2030 3,285 3,09 3,305 3,141
Series 1995-C3, Class A-2, 6.949% / 6.755% 2025 (3) 1,500 1,48 1,500 1,488
Series 1995-C3, Class A-3, 7.189% / 6.995% 2025 (3) 1,500 1,47 1,500 1,487
Structured Asset Securities Corp.:
Series 1998-RF2, Class A, 8.549% / 8.55% 2027 (2,3) 2,823 2,88 2,865 2,948
Series 1998-RF1, Class A, 8.676% / 8.68% 2027 (2,3) 2,649 2,72 2,690 2,776
Mortgage Capital Funding, Inc., Series 1998-MC1, 5,782 5,60 5,820 5,686
Class A-1, 6.42% 2030
Chase Commercial Mortgage Securities Corp.:
Series 1998-2, Class A-2, 6.39% 2008 3,000 2,79 3,000 2,836
Series 1998-1, Class A-1, 6.34% 2030 2,681 2,60 2,700 2,644
CS First Boston Mortgage Securities Corp., 5,576 5,38 5,617 5,461
Series 1998-C1, Class A-1A, 6.26% 2040
Security National Mortgage Loan Trust, Series 5,000 4,79 5,000 4,821
1999-1, Class A-2, 8.353% 2030 (2)
Commercial Mortgage Acceptance Corp.:
Series 1998-C1, Class A-1, 6.23% 2007 2,245 2,16 2,259 2,191
Series 1998-C2, Class A-1, 5.80% 2006 1,353 1,28 1,363 1,306
AMRESCO Commercial Mortgage Funding I Corp., 3,307 3,25 3,320 3,292
Series 1997-C1, Class A-1, 6.73% 2029
J.P. Morgan Commercial Mortgage Finance Corp., 3,000 2,97 3,000 2,991
Series 1995-C1, Class A-2, 7.373% / 7.413% 2010 (3)
Nationsbanc Montgomery Funding Corp., 2,697 2,53 2,728 2,579
Series 1998-5, Class A-1, 6.00% 2013
First Nationwide Trust, Series 1999-2, Class 2,037 1,90 2,048 1,925
IPP-A-1, 6.50% 2029
Freddie Mac Loan Receivables Trust, Series 2,000 1,84 2,000 1,843
1998-A, Class A-3, 6.69% 2020 (2)
LB Commerical Conduit Mortgage Trust, Series 1,700 1,66 1,713 1,684
1998-C1, Class A-1, 6.33% 2030
GMAC Commercial Mortgage Securities, Inc., 1,500 1,42 1,500 1,465
Series 1997-C1, Class A-3, 6.869% 2007
DLJ Mortgage Acceptance Corp., 1,373 1,36 1,386 1,389
Series 1996-CF1, Class A-1A, 7.28% 2028 (2)
DLJ Commercial Mortgage Corp., 1,250 1,15 1,250 1,171
Series 1998-CF2, Class A-1B, 6.24% 2031
Norwest Asset Securities Corp., Series 1998-31, 1,143 1,08 1,150 1,095
Class A-1, 6.25% 2014
Ryland Acceptance Corp., Series 88, Class E, 708 70 708 712
7.95% 2019
U.S. Treasury Obligations - 16.50% / 17.83%
8.875% 2017 19,790 23,91 19,790 24,370
10.375% 2009 16,000 18,40 17,500 20,379
5.75% 2003 7,160 7,01 7,560 7,468
10.75% 2003 6,500 7,34 6,500 7,408
6.625% 2001 3,000 3,01 4,500 4,542
7.875% 2021 3,500 3,91 3,500 4,004
7.125% 2023 3,425 3,56 3,425 3,652
7.25% 2004 - - 3,500 3,644
6.125% 2007 3,650 3,55 3,650 3,612
12.00% 2013 2,000 2,67 2,000 2,717
8.75% 2017 1,400 1,67 1,400 1,704
11.625% 2002 1,000 1,13 1,000 1,145
5.875% 2002 125 12 125 124
Strip Principal, 0% 2027 5,780 97 2,880 499
Asset-Backed Obligations (1) - 14.82% / 14.92%
Green Tree Finacial Corp.:
Series 1995-9, Class A-5, 6.80% 2027 5,000 4,97 5,000 4,983
Series 1996-7, Class A-6, 7.65% 2027 3,000 2,99 3,000 3,021
Series 1997-6, Class A-7, 7.14% 2029 2,500 2,46 2,500 2,483
Series 1997-6, Class A-6, 6.90% 2029 2,500 2,47 2,500 2,481
Series 1996-10, Class A-5, 6.83% 2028 2,500 2,45 2,500 2,448
Series 1999-2, Class A-2, 5.84% 2030 2,500 2,43 2,500 2,445
Series 1995-3, Class A-5, 7.30% 2025 2,050 2,05 2,050 2,056
NPF:2
XII, Inc., Series 1999-2, Class A, 7.05% 2003 11,875 11,67 11,875 11,706
VI, Inc., Series 1999-1, Class A, 6.25% 2003 1,000 97 1,000 978
PP&L Transistion Bond Co. LLC, Series 1999-1, 8,750 8,71 10,250 10,345
Class A-8, 7.15% 2008
EQCC Home Equity Loan Trust, Series 1999-2, 5,000 4,87 5,000 4,886
Class A-3F, 6.347% 2022
Puerto Rico Public Financing Corp., Series 4,774 4,63 4,774 4,654
1999-1, Class A, AMBAC Insured, 6.15% 2008
Chase Credit Card Master Trust, Series 1997-5, 4,000 3,90 4,000 3,931
Class A, 6.194% 2005
Green Tree Recreational, Equipment & Consumer 3,000 2,95 3,000 2,964
Trust, Series 1999-A, Class A-6, 6.84% 2029
Triad Auto Receivables Owner Trust, Series 1999-1, 3,000 2,93 3,000 2,942
Class A-2, FSA Insured, 6.09% 2005
ComEd Transitional Funding Trust:
Series 1998-1, Class A-5, 5.44% 2005 1,600 1,50 1,600 1,518
Series 1998-1, Class A-7, 5.74% 2008 1,500 1,35 1,500 1,374
Standard Credit Card Master Trust I, 2,500 2,55 2,500 2,565
Series 1994-4, Class A, 8.25% 2003
PECO Energy Transition Trust, Series 1999-1 2,000 1,84 2,000 1,871
Class A-7, 6.13% 2009
Citibank Credit Card Master Trust I, Series 1998-9, 1,800 1,68 1,800 1,704
Class A, 5.30% 2006
Federal Agency Obligations - Other - 7.08% / 5.67%
Fannie Mae:
6.00% 2008 9,850 9,22 9,850 9,367
5.25% 2009 3,000 2,64 3,000 2,689
Freddie Mac:
5.125% 2008 7,500 6,57 7,500 6,677
5.75% 2008 3,500 3,22 3,500 3,274
6.25% 2004 3,500 3,42 - -
Tennessee Valley Authority, Series G, 5.375% 2008 3,250 2,88 3,250 2,937
Federal Home Loan Banks:
5.125% 2003 4,700 4,44 1,500 1,429
5.625% 2001 750 74 750 745
Collateralized Mortgage Obligations (Federal
Agencies) (1) - 3.47% / 3.44%
Freddie Mac:
Series 1567, Class A, 5.333% / 6,463 6,28 6,513 6,338
5.373% 2023 (3)
Series 1716, Class A, 6.50% 2009 2,250 2,15 2,250 2,192
Series 1507, Class JZ, 7.00% 2023 633 57 630 583
Series 2030, Class F, 6.96% / 5.90% 2028 (3) 245 24 248 250
Series 83-B, Class B-3, 12.50% 2013 200 21 200 218
Fannie Mae:
Series 1997-M6, Class ZA, 6.85% 2026 5,864 4,88 5,831 4,942
Series 1997-28, Class C, 7.00% 2027 1,000 95 1,000 962
Series 1998-M6, Class A-2, 6.32% 2008 1,000 92 1,000 944
Developmental Authorities - 2.38% / 2.38%
Inter-American Development Bank 8.875% 2009 10,000 11,17 10,000 11,374
Foreign Governmental Authorities - 0.22% / 0.21%
KfW International Finance Inc. 7.625% 2004 1,000 1,01 1,000 1,025
---------- ----------
TOTAL BONDS & NOTES (cost: $468,371,000 452,731 466,251
and $477,919,000, respectively)
---------- ----------
Short Term Securities
Corporate Short-Term Notes - 2.62% / 0.88%
--------------------------------------------
Associates Corp. of North America 5.71% due 12/1/1999 - - 4,200 4,199
Associates First Capital Corp. 4.00% due 1/3/2000 6,400 6,39 - -
Ford Motor Credit Co. 6.02% due 1/4/2000 5,900 5,89 - -
---------- ----------
TOTAL SHORT-TERM SECURITIES (cost: 12,294 4,199
$12,294,000 and $4,199,000 respectively)
---------- ----------
TOTAL INVESTMENT SECURITIES (cost: 465,02 470,450
$480,665,000 and $ 482,118,000 respectivley)
Net cash, receivables and payables 3,529 7,729
---------- ----------
NET ASSETS $468,554 $478,179
---------- ----------
---------- ----------
(1)Pass-through securities backed by a pool
of mortgages or other loans on which principal
payments are periodically made. Therefore,
the effective maturity is shorter than the stated
maturity.
(2)Purchased in a private placement transaction;
resale to the public may require registration or
sale only to qualified institutional buyers.
(3)Coupon rate may change periodically.
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series Cash Management Fund
Investment Portfolio, December 31 and November 30, 1999
<S> <C> <C> <C> <C>
December December November November
3 3 30 30
Principa Market Principa Market
Amount Value Amount Value
Short-Term Securities (000) (000) (000) (000)
-------------------------------------------- -------- -------- -------- --------
Corporate Short-Term Notes - 72.99%/72.53%
Motiva Enterprises LLC 5.85% due 1/19/2000 9,80 $ 9,770 9,800 $ 9,720
AT&T Corp. 5.25% due 12/17/1999 9,500 9,476
Merck & Co., Inc. 5.72% due 1/31/2000 9,20 9,15 9,200 9,108
Bell Atlantic Network Funding Corp. 5.27%-5.92% 9,00 8,96 9,000 8,992
due 12/6/1999-1/25/2000
Duke Energy Corp. 5.28% due 12/7/1999 9,000 8,991
Exxon Asset Management Co. 5.81% due 1/5/2000 (1) 9,00 8,99 9,000 8,948
Motorola, Inc. 5.81% due 1/18/2000 9,00 8,97 9,000 8,929
Vermont American Corp. 5.83% due 1/18/2000 (1) 9,00 8,97 9,000 8,929
International Lease Finance Corp. 5.76% due 2/1/2000 9,00 8,95 9,000 8,908
Park Avenue Receivables Corp. 5.97% due 1/10/2000 (1 8,86 8,84 8,861 8,801
CIT Group Holdings, Inc. 5.29%-5.88% due 8,70 8,66 8,700 8,696
12/3/1999-1/28/2000
SBC Communications Inc. 5.82% due 1/18/2000 (1) 8,70 8,67 8,700 8,631
Alcoa Inc. 5.30% due 12/1/1999 8,500 8,499
Coca-Cola Co. 5.77% due 1/13/2000 8,50 8,48 8,500 8,440
Albertson's, Inc. 5.85% due 1/18/2000 (1) 8,50 8,47 8,500 8,432
A.I. Credit Corp. 5.81%-5.82% due 1/20/2000 8,50 8,47 8,500 8,430
Hershey Foods Corp. 5.28% due 12/9/1999 8,300 8,289
Ford Motor Credit Co. 5.32% due 12/8/1999 8,200 8,190
E.I. du Pont de Nemours and Co. 5.29% due 12/3/1999 8,100 8,096
National Rural Utilities Cooperative Finance Corp. 8,000 7,985
!5.30% due 12/13/1999
Halliburton Co. 5.27% due 12/22/1999 8,000 7,974
Procter & Gamble Co. 5.82% due 1/10/2000 8,00 7,98 8,000 7,947
Chevron USA Inc. 5.80% due 1/11/2000 8,00 7,98 8,000 7,946
American General Finance Corp. 5.84% due 1/18/2000 8,00 7,97 8,000 7,936
Household Finance Corp. 5.28%-5.94% due 6,80 6,76 7,500 7,493
12/6/1999-2/2/2000
Kimberly-Clark Corp. 5.81% due 1/24/2000 (1) 7,50 7,47 7,500 7,433
Harvard University 5.30% due 12/7/1999 7,200 7,193
IBM Credit Corp. 5.30% due 12/10/1999 7,000 6,990
H.J. Heinz Co. 5.27%-5.83% due 12/3/1999-1/25/2000 9,00 8,96 6,000 5,997
Monsanto Co. 5.93% due 1/7/2000 (1) 6,00 5,99 6,000 5,963
Corporate Asset Funding Co. Inc. 5.40% due 5,000 4,990
12/14/1999 (1)
Wal-Mart Stores, Inc. 5.47% due 12/21/1999 (1) 4,600 4,585
Pfizer Inc 5.87% due 2/9/2000 (1) 10,00 9,935
Associates First Capital Corp. 4.00% due 1/3/2000 9,57 9,567
John Hancock Capital Corp. 5.90% due 1/4/2000 (1) 9,00 8,994
BellSouth Capital Funding Corp. 5.87% due 2/4/2000 ( 9,00 8,949
Schering Corp. 6.00% due 2/8/2000 9,00 8,941
Anheuser-Busch Companies, Inc. 5.68% due 2/3/2000 8,50 8,453
Gillette Co. 5.85% due 1/14/2000 (1) 8,50 8,481
Baltimore Gas and Electric Co. 5.88% due 1/14/2000 8,19 8,181
Minnesota Mining and Manufacturing Co. 5.80% 8,20 8,172
due 1/21/2000
American Express Credit Corp. 5.94% due 1/27/2000 7,80 7,765
Fortune Brands Inc. 6.25% due 1/26/2000 5,80 5,774
Avon Capital Corp. 6.70% due 1/6/2000 (1) 4,60 4,595
Federal Agency Discount Notes - 27.23%/27.71%
Fannie Mae 5.21%-5.66% due 12/2/1999-2/9/2000 21,00 20,89 44,900 44,804
Freddie Mac 5.19%-5.82% due 12/1/1999-2/24/2000 40,30 40,05 39,945 39,865
International Bank for Reconstruction and Developmen 27,94 27,87 10,300 10,220
!5.48%-5.80% due 1/12-1/21/2000
Federal Home Loan Banks 5.36%-5.82% due 10,59 10,54 3,300 3,295
12/10/1999-2/18/2000
---------- ----------
TOTAL INVESTMENT SECURITIES (cost: 365,700 355,121
$365,701,000 and $355,124,000 respectively)
Net cash, receivables and payables (801) (865)
---------- ----------
NET ASSETS 364,899 354,256
========== ==========
(1) Purchased in a private placement transaction;
resale to the public may require registration
or sale only to qualified institutional buyers.
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
at December 31, 1999 and November 30, 1999
(dollars in thousands, except per-share
data)
<S> <C> <C> <C> <C>
Global Small
Global Capitalization
Growth Fund Fund
---------- ---------- ---------- ----------
December 31, November 30, December 31, November 30,
1999 1999 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
ASSETS:
Investment securities at market $725,056 $602,020 $288,428 $240,162
Cash 101 29 3 42
Receivables for-
Sales of investments 40 1,73
Sales of fund's shares 1,076 305 538 438
Open forward currency
contracts - net -
Dividends and interest 272 1,305 70 200
---------- ---------- ---------- ----------
726,50 604,061 289,0 242,576
LIABILITIES: ---------- ---------- ---------- ----------
Payables for-
Purchases of investments 16,081 4,067
Repurchases of fund's shares 6
Management services 376 314 177 145
Distribution fees - Class 2 7 6 1
Other expenses 27 28 11 9
---------- ---------- ---------- ----------
47 16,544 2 4,238
NET ASSETS AT ---------- ---------- ---------- ----------
December 31, 1999 and November 30, 1999
(Total $26,310,890 and $24,065,679,
respectively) 726,02 $587,517 288,8 $238,338
=========== =========== =========== ===========
Investment securities at cost $460,362 $440,187 210,0 $182,722
=========== =========== =========== ===========
Class 1 (unlimited shares authorized):
Net assets (Total $22,399,176 and
$20,686,307, respectively) $327,137 $271,914 $178,020 $150,240
Shares of beneficial interest
outstanding 15,274,162 14,316,682 10,248,227 8,756,127
Net asset value per share $21.42 $18.99 $17.37 $17.16
Class 2 (unlimited shares authorized):
Net assets (Total $3,911,714 and
$3,379,372, respectively) $398,890 $315,603 $110,782 $88,098
Shares of beneficial interest
outstanding 18,635,121 16,625,731 6,381,225 5,139,964
Net asset value per share $21.41 $18.98 $17.36 $17.14
Growth Fund International Fund
---------- ---------- ---------- ----------
December 31, November 30, December 31, November 30,
1999 1999 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
ASSETS:
Investment securities at market $9,374,786 $8,262,639 $4,502,726 $3,831,636
Cash 142 324 - 982
Receivables for-
Sales of investments - 4,63 - 6,32
Sales of fund's shares 4,057 1,891 2,060 469
Open forward currency
contracts - net - - -
Dividends and interest 1,473 1,995 3,426 3,495
---------- ---------- ---------- ----------
9,380,45 8,271,482 4,508,2 3,842,908
LIABILITIES: ---------- ---------- ---------- ----------
Payables for-
Purchases of investments - 56,900 - 2,931
Repurchases of fund's shares 4,47 4,63 1,9 58
Management services 2,723 2,506 1,874 1,622
Distribution fees - Class 2 21 18 5
Other expenses 270 276 379 431
---------- ---------- ---------- ----------
7,68 64,502 4,2 5,628
NET ASSETS AT ---------- ---------- ---------- ----------
December 31, 1999 and November 30, 1999
(Total $26,310,890 and $24,065,679,
respectively) 9,372,77 $8,206,980 4,503,9 $3,837,280
=========== =========== =========== ===========
Investment securities at cost 5,026,39 $5,033,490 2,292,1 $2,244,736
=========== =========== =========== ===========
Class 1 (unlimited shares authorized):
Net assets (Total $22,399,176 and
$20,686,307, respectively) $8,224,215 $7,270,253 $4,112,613 $3,526,134
Shares of beneficial interest
outstanding 116,457,977 100,808,884 153,817,355 140,588,653
Net asset value per share $70.62 $72.12 $26.74 $25.08
Class 2 (unlimited shares authorized):
Net assets (Total $3,911,714 and
$3,379,372, respectively) $1,148,559 $936,727 $391,322 $311,146
Shares of beneficial interest
outstanding 16,275,900 13,003,113 14,638,924 12,412,402
Net asset value per share $70.57 $72.04 $26.73 $25.07
New World Fund Growth-Income Fund
---------- ---------- ---------- ----------
December 31, November 30, December 31, November 30,
1999 1999 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
ASSETS:
Investment securities at market $82,823 $66,926 $7,828,805 $7,656,736
Cash 88 227 169 317
Receivables for-
Sales of investments - 23,16
Sales of fund's shares 379 133 2,367 1,115
Open forward currency
contracts - net - -
Dividends and interest 191 194 8,708 10,558
---------- ---------- ---------- ----------
83,48 67,480 7,840,0 7,691,895
LIABILITIES: ---------- ---------- ---------- ----------
Payables for-
Purchases of investments 2,344 - 38,495
Repurchases of fund's shares 2,5 4,62
Management services 54 42 2,192 2,149
Distribution fees - Class 2 2 22
Other expenses 5 3 277 266
---------- ---------- ---------- ----------
6 2,397 5,2 45,756
NET ASSETS AT ---------- ---------- ---------- ----------
December 31, 1999 and November 30, 1999
(Total $26,310,890 and $24,065,679,
respectively) $83,415 $65,083 7,834,8 $7,646,139
=========== =========== =========== ===========
Investment securities at cost 71,653 $63,481 6,715,4 $6,660,331
=========== =========== =========== ===========
Class 1 (unlimited shares authorized):
Net assets (Total $22,399,176 and
$20,686,307, respectively) $45,229 $36,771 $6,631,972 $6,537,371
Shares of beneficial interest
outstanding 3,843,422 3,482,087 200,490,319 168,938,996
Net asset value per share $11.77 $10.56 $33.08 $38.70
Class 2 (unlimited shares authorized):
Net assets (Total $3,911,714 and
$3,379,372, respectively) $38,186 $28,312 $1,202,832 $1,108,768
Shares of beneficial interest
outstanding 3,245,506 2,682,522 36,371,662 28,670,703
Net asset value per share $11.77 $10.55 $33.07 $38.67
Asset
Allocation Fund Bond Fund
---------- ---------- ---------- ----------
December 31, November 30, December 31, November 30,
1999 1999 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
ASSETS:
Investment securities at market $1,720,072 $1,714,981 $250,686 $248,950
Cash 175 1,563
Receivables for-
Sales of investments 13 52 68
Sales of fund's shares 664 112 286 127
Open forward currency
contracts - net - - -
Dividends and interest 8,538 8,606 3,681 3,986
---------- ---------- ---------- ----------
1,729,579 1,725,790 254,6 253,744
LIABILITIES: ---------- ---------- ---------- ----------
Payables for-
Purchases of investments 9,407
Repurchases of fund's shares 70 1,07 2 27
Management services 623 608 111 106
Distribution fees - Class 2 7 6 1
Other expenses 62 127 48 33
---------- ---------- ---------- ----------
1,459 11,277 4 427
NET ASSETS AT ---------- ---------- ---------- ----------
December 31, 1999 and November 30, 1999
(Total $26,310,890 and $24,065,679,
respectively) $1,728,120 $1,714,513 254,2 $253,317
=========== =========== =========== ===========
Investment securities at cost $1,463,070 $1,479,346 262,7 $261,075
=========== =========== =========== ===========
Class 1 (unlimited shares authorized):
Net assets (Total $22,399,176 and
$20,686,307, respectively) $1,387,375 $1,393,837 $169,037 $173,264
Shares of beneficial interest
outstanding 92,077,466 86,931,205 17,349,968 17,577,655
Net asset value per share $15.07 $16.03 $9.74 $9.86
Class 2 (unlimited shares authorized):
Net assets (Total $3,911,714 and
$3,379,372, respectively) $340,745 $320,676 $85,197 $80,053
Shares of beneficial interest
outstanding 22,619,588 20,012,529 8,746,371 8,126,181
Net asset value per share $15.06 $16.02 $9.74 $9.85
U.S. Government/
High-Yield AAA-Rated
Bond Fund Securities Fund
---------- ---------- ---------- ----------
December 31, November 30, December 31, November 30,
1999 1999 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
ASSETS:
Investment securities at market $675,173 $672,885 $465,025 $470,450
Cash 141 110 281
Receivables for-
Sales of investments 35 1,35 5,07
Sales of fund's shares 46 112 11 53
Open forward currency
contracts - net 18 40 - -
Dividends and interest 9,676 10,841 3,908 3,870
---------- ---------- ---------- ----------
685,99 685,597 469,1 479,725
LIABILITIES: ---------- ---------- ---------- ----------
Payables for-
Purchases of investments - 1,047
Repurchases of fund's shares 32 85 3 26
Management services 291 281 204 202
Distribution fees - Class 2 2 1
Other expenses 33 365 26 25
---------- ---------- ---------- ----------
66 1,520 5 1,546
NET ASSETS AT ---------- ---------- ---------- ----------
December 31, 1999 and November 30, 1999
(Total $26,310,890 and $24,065,679,
respectively) 685,32 $684,077 $468,554 $478,179
=========== =========== =========== ===========
Investment securities at cost 729,24 $735,084 $480,665 $482,118
=========== =========== =========== ===========
Class 1 (unlimited shares authorized):
Net assets (Total $22,399,176 and
$20,686,307, respectively) $586,168 $588,997 $420,579 $431,383
Shares of beneficial interest
outstanding 45,976,558 45,993,928 39,812,295 40,001,057
Net asset value per share $12.75 $12.81 $10.56 $10.78
Class 2 (unlimited shares authorized):
Net assets (Total $3,911,714 and
$3,379,372, respectively) $99,158 $95,080 $47,975 $46,796
Shares of beneficial interest
outstanding 7,779,063 7,429,225 4,542,189 4,341,910
Net asset value per share $12.75 $12.80 $10.56 $10.78
Cash
Management Fund
---------- ----------
December 31, November 30,
1999 1999
---------------------------------- ----------- -----------
ASSETS:
Investment securities at market $365,700 $355,121
Cash 10 180
Receivables for-
Sales of investments -
Sales of fund's shares 11 141
Open forward currency
contracts - net -
Dividends and interest -
---------- ----------
365,721 355,442
LIABILITIES: ---------- ----------
Payables for-
Purchases of investments 1,031
Repurchases of fund's shares 66 -
Management services 134 132
Distribution fees - Class 2 1 10
Other expenses 13 13
---------- ----------
822 1,186
NET ASSETS AT ---------- ----------
December 31, 1999 and November 30, 1999
(Total $26,310,890 and $24,065,679,
respectively) $364,899 $354,256
=========== ===========
Investment securities at cost $365,701 $355,124
=========== ===========
Class 1 (unlimited shares authorized):
Net assets (Total $22,399,176 and
$20,686,307, respectively) $316,831 $306,143
Shares of beneficial interest
outstanding 28,679,142 27,506,247
Net asset value per share $11.05 $11.13
Class 2 (unlimited shares authorized):
Net assets (Total $3,911,714 and
$3,379,372, respectively) $48,068 $48,113
Shares of beneficial interest
outstanding 4,352,002 4,325,590
Net asset value per share $11.04 $11.12
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series
FINANCIAL STATEMENTS
Statement of Operations
for the one month period
ended December 31, 1999 and
the year ended November 30, 1999
(dollars in thousands)
<S> <C> <C> <C> <C>
Global Small
Global Growth Capitalization
Fund Fund
---------------- --------------------------------------------------
Period ended Year ended Period ended Year ended
December 31, November 30, December 31, November 30,
1999 1999 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
INVESTMENT INCOME (LOSS:)
Income:
Dividends $556 $4,057 $60 $970
Interest 267 2,668 129 816
---------- ---------- ---------- ----------
8 6,725 189 1,786
---------- ---------- ---------- ----------
Expenses:
Management services fee 376 2,672 176 1,054
Distribution fees - Class 2 75 484 21 105
Reports to shareholders 13 - 5
Registration statement and
prospectus 7 - 3
Postage, stationery and
supplies 2 3 1 1
Trustees' fees 2 4 1 1
Auditing and legal fees 5 3 2 1
Custodian fee 14 82 8 23
Taxes other than federal
income tax 4 1
Other expenses 4 4
---------- ---------- ---------- ----------
4 3,276 209 1,198
---------- ---------- ---------- ----------
Net investment income (loss) 3 3,449 (20) 588
---------- ---------- ---------- ----------
REALIZED GAIN (LOSS) AND
UNREALIZED APPRECIATION
(DEPRECIATION) ON INVESTMENTS:
Realized gain (loss) 7,9 28,893 8,25 24,832
---------- ---------- ---------- ----------
Net change in unrealized appreciation
(depreciation) on investments 102,879 136,393 20,900 61,148
Net change in unrealized appreciation
(depreciation) on open forward - - -
currency contracts
---------- ---------- ---------- ----------
Net unrealized appreciation
(depreciation) 102,8 136,393 20,900 61,148
---------- ---------- ---------- ----------
Net realized gain (loss) and
unrealized appreciation (depreciation)
on investments 110,8 165,286 29,152 85,980
---------- ---------- ---------- ----------
NET INCREASE(DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 111,2 $168,735 $29,132 $86,568
========= ========= ========= =========
International
Growth Fund Fund
---------------- --------------------------------------------------
Period ended Year ended Period ended Year ended
December 31, November 30, December 31, November 30,
1999 1999 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
INVESTMENT INCOME (LOSS:)
Income:
Dividends $1,512 $19,665 $2,172 $45,571
Interest 2,228 20,676 1,270 9,417
---------- ---------- ---------- ----------
3,740 40,341 3,44 54,988
---------- ---------- ---------- ----------
Expenses:
Management services fee 2,723 26,451 1,874 17,107
Distribution fees - Class 2 218 1,417 74 470
Reports to shareholders 11 241 5 107
Registration statement and
prospectus 89 - 38
Postage, stationery and
supplies 29 70 14 31
Trustees' fees 34 69 16 32
Auditing and legal fees 63 67 29 35
Custodian fee 40 269 138 1,415
Taxes other than federal
income tax 86 - 64
Other expenses 9 48 4 54
---------- ---------- ---------- ----------
3,127 28,807 2,15 19,353
---------- ---------- ---------- ----------
Net investment income (loss) 613 11,534 1,28 35,635
---------- ---------- ---------- ----------
REALIZED GAIN (LOSS) AND
UNREALIZED APPRECIATION
(DEPRECIATION) ON INVESTMENTS:
Realized gain (loss) 65,111 1,261,163 70,792 419,919
---------- ---------- ---------- ----------
Net change in unrealized appreciation
(depreciation) on investments 1,119,232 1,604,675 623,662 971,987
Net change in unrealized appreciation
(depreciation) on open forward - - -
currency contracts
---------- ---------- ---------- ----------
Net unrealized appreciation
(depreciation) 1,119,232 1,604,675 623,66 971,987
---------- ---------- ---------- ----------
Net realized gain (loss) and
unrealized appreciation (depreciation)
on investments 1,184,343 2,865,838 694,45 1,391,906
---------- ---------- ---------- ----------
NET INCREASE(DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $1,184,956 $2,877,372 695,74 $1,427,541
========= ========= ========= =========
Growth-Income
New World Fund Fund
---------------- --------------------------------------------------
Period ended Period ended Period ended Year ended
December 31, November 30, December 31, November 30,
1999 1999* 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
INVESTMENT INCOME (LOSS:)
Income:
Dividends $ 46 $ 134 $11,556 $113,635
Interest 148 419 4,955 48,424
---------- ---------- ---------- ----------
1 553 16,51 162,059
---------- ---------- ---------- ----------
Expenses:
Management services fee 54 154 2,192 26,220
Distribution fees - Class 2 7 17 241 2,063
Reports to shareholders 1 11 266
Registration statement and
prospectus 2 - 92
Postage, stationery and
supplies 27 84
Trustees' fees 31 82
Auditing and legal fees 58 85
Custodian fee 7 12 143
Taxes other than federal
income tax - 91
Other expenses 10 53
---------- ---------- ---------- ----------
181 2,58 29,179
---------- ---------- ---------- ----------
Net investment income (loss) 1 372 13,92 132,880
---------- ---------- ---------- ----------
REALIZED GAIN (LOSS) AND
UNREALIZED APPRECIATION
(DEPRECIATION) ON INVESTMENTS:
Realized gain (loss) 2 9 112,696 1,254,871
---------- ---------- ---------- ----------
Net change in unrealized appreciation
(depreciation) on investments 7,725 3,445 116,969 (469,846)
Net change in unrealized appreciation
(depreciation) on open forward - - - -
currency contracts
---------- ---------- ---------- ----------
Net unrealized appreciation
(depreciation) 7,7 3,445 116,96 (469,846)
---------- ---------- ---------- ----------
Net realized gain (loss) and
unrealized appreciation (depreciation)
on investments 7,9 3,454 229,66 785,025
---------- ---------- ---------- ----------
NET INCREASE(DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $8,125 $3,826 243,59 $917,905
========= ========= ========= =========
Asset
Allocation Fund Bond Fund
---------------- --------------------------------------------------
Period ended Year ended Period ended Year ended
December 31, November 30, December 31, November 30,
1999 1999 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
INVESTMENT INCOME (LOSS:)
Income:
Dividends $1,965 $19,852 $37 $316
Interest 4,074 48,017 1,718 18,173
---------- ---------- ---------- ----------
6,0 67,869 1,75 18,489
---------- ---------- ---------- ----------
Expenses:
Management services fee 623 7,418 111 1,228
Distribution fees - Class 2 70 608 18 149
Reports to shareholders 2 60 8
Registration statement and
prospectus 23 3
Postage, stationery and
supplies 6 19 1 3
Trustees' fees 7 19 1 2
Auditing and legal fees 13 19 2 3
Custodian fee 3 40 1 12
Taxes other than federal
income tax 20 3
Other expenses 2 14 2
---------- ---------- ---------- ----------
7 8,240 13 1,413
---------- ---------- ---------- ----------
Net investment income (loss) 5,3 59,629 1,62 17,076
---------- ---------- ---------- ----------
REALIZED GAIN (LOSS) AND
UNREALIZED APPRECIATION
(DEPRECIATION) ON INVESTMENTS:
Realized gain (loss) (2,150) 108,464 (155) (1,349)
---------- ---------- ---------- ----------
Net change in unrealized appreciation
(depreciation) on investments 21,367 (42,237) 50 (10,317)
Net change in unrealized appreciation
(depreciation) on open forward - - (19)
currency contracts
---------- ---------- ---------- ----------
Net unrealized appreciation
(depreciation) 21,3 (42,237) 5 (10,336)
---------- ---------- ---------- ----------
Net realized gain (loss) and
unrealized appreciation (depreciation)
on investments 19,2 66,227 (10 (11,685)
---------- ---------- ---------- ----------
NET INCREASE(DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 24,5 $125,856 1,51 $5,391
========= ========= ========= =========
U.S. Government/
High-Yield AAA-Rated
Bond Fund Securites Fund
-------------------------------------------------------------------
Period ended Year ended Period ended Year ended
December 31, November 30, December 31, November 30,
1999 1999 1999 1999
---------------------------------- ----------- ----------- ----------- -----------
INVESTMENT INCOME (LOSS:)
Income:
Dividends $67 $836 - -
Interest 5,645 70,024 $2,700 $34,874
---------- ---------- ---------- ----------
5,7 70,860 2,70 34,874
---------- ---------- ---------- ----------
Expenses:
Management services fee 291 3,651 204 2,681
Distribution fees - Class 2 21 203 10 97
Reports to shareholders 1 25 - 19
Registration statement and
prospectus 1 - 7
Postage, stationery and
supplies 2 9 2 6
Trustees' fees 3 8 2 6
Auditing and legal fees 5 9 4 6
Custodian fee 2 22 1 13
Taxes other than federal
income tax 8 - 6
Other expenses 1 7 1 5
---------- ---------- ---------- ----------
3 3,952 22 2,846
---------- ---------- ---------- ----------
Net investment income (loss) 5,3 66,908 2,47 32,028
---------- ---------- ---------- ----------
REALIZED GAIN (LOSS) AND
UNREALIZED APPRECIATION
(DEPRECIATION) ON INVESTMENTS:
Realized gain (loss) (922) (13,757) (450) (3,881)
---------- ---------- ---------- ----------
Net change in unrealized appreciation
(depreciation) on investments 8,138 (22,789) (3,972) (27,213)
Net change in unrealized appreciation
(depreciation) on open forward (167) 340 - -
currency contracts
---------- ---------- ---------- ----------
Net unrealized appreciation
(depreciation) 7,9 (22,449) (3,97 (27,213)
---------- ---------- ---------- ----------
Net realized gain (loss) and
unrealized appreciation (depreciation)
on investments 7,0 (36,206) (4,42 (31,094)
---------- ---------- ---------- ----------
NET INCREASE(DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 12,4 $30,702 ($1,946) $934
========= ========= ========= =========
Cash Management
Fund
---------------- ----------------
Period ended Year ended
December 31, November 30,
1999 1999
---------------------------------- ----------- -----------
INVESTMENT INCOME (LOSS:)
Income:
Dividends -
Interest $1,761 $16,519
---------- ----------
1,7 16,519
---------- ----------
Expenses:
Management services fee 134 1,441
Distribution fees - Class 2 10 97
Reports to shareholders 1 12
Registration statement and
prospectus 4
Postage, stationery and
supplies 1 3
Trustees' fees 1 4
Auditing and legal fees 3 3
Custodian fee 1 7
Taxes other than federal
income tax 3
Other expenses 3
---------- ----------
1 1,577
---------- ----------
Net investment income (loss) 1,6 14,942
---------- ----------
REALIZED GAIN (LOSS) AND
UNREALIZED APPRECIATION
(DEPRECIATION) ON INVESTMENTS:
Realized gain (loss) 0
---------- ----------
Net change in unrealized appreciation
(depreciation) on investments 2 (3)
Net change in unrealized appreciation
(depreciation) on open forward -
currency contracts
---------- ----------
Net unrealized appreciation
(depreciation) (3)
---------- ----------
Net realized gain (loss) and
unrealized appreciation (depreciation)
on investments (3)
---------- ----------
NET INCREASE(DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $1,612 $14,939
========= =========
*For the period June 17, 1999,
commencement of operations,
through November 30, 1999.
See Notes to Financial Statements
</TABLE>
<TABLE>
American Variable Insurance Series
FINANCIAL STATEMENTS
<S> <C> <C> <C>
Statement of Changes in Net Assets Global
(dollars in thousands) Growth Fund
--------------------------------------------------
Period ended Year ended Year ended
December 31, November 30, November 30,
1999 (1) 1999 1998
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) $349 $3,449 $1,980
Net realized gain (loss) on investments 7,977 28,893 9,087
Net unrealized appreciation (depreciation)
on investments 102,879 136,393 26,951
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 111,205 168,735 38,018
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (1,567) (1,453) (1,226)
Class 2 (1,7 (98 (766)
----------- ----------- -----------
Total dividends from net investment income (3,2 (2,43 (1,992)
Distributions from net realized gain on
investments (28,845) (8,908) (277)
----------- ----------- -----------
Total dividends and distributions (32,114) (11,344) (2,269)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 5,394 67,540 45,339
Proceeds from shares issued on reinvestment
of dividends and distributions 14,698 6,056 1,395
Cost of shares repurchased (1,060) (10,585) (15,055)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti 19,032 63,011 31,679
----------- ----------- -----------
Class 2:
Proceeds from shares sold 23,049 108,096 61,131
Proceeds from shares issued on reinvestment
of dividends and distributions 17,416 5,288 874
Cost of shares repurchased (78) (1,571) (893)
----------- ----------- -----------
Net increase from Class 2 transactions 40,387 111,813 61,112
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 59,419 174,824 92,791
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 138,510 332,215 128,540
NET ASSETS:
Beginning of period 587,517 255,302 126,762
----------- ----------- -----------
End of period $726,027 $587,517 $255,302
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) ($1,752) $1,343 $296
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 267,792 4,441,849 3,748,614
Shares issued on reinvestment of dividends
and distributions 741,190 444,162 118,716
Shares repurchased (51,502) (681,311) (1,315,104)
----------- ----------- -----------
Net increase (decrease) in shares outstanding 957,480 4,204,700 2,552,226
============ ============ ============
Class 2:
Shares sold 1,134,476 6,844,522 5,120,157
Shares issued on reinvestment of dividends
and distributions 878,682 390,215 73,850
Shares repurchased (3,768) (105,965) (78,598)
----------- ----------- -----------
Net increase in shares outstanding 2,009,390 7,128,772 5,115,409
============ ============ ============
Global Small
Capitalization
Fund
--------------------------------------------------
Period ended Year ended Period ended
December 31, November 30, November 30,
1999 (1) 1999 1998 (2)
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) ($20) $588 $409
Net realized gain (loss) on investments 8,252 24,832 925
Net unrealized appreciation (depreciation)
on investments 20,900 61,148 (3,708)
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 29,132 86,568 (2,374)
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (109) (520) (194)
Class 2 (16 (36)
----------- ----------- -----------
Total dividends from net investment income (1 (68 (230)
Distributions from net realized gain on
investments (24,812) (1,115) -
----------- ----------- -----------
Total dividends and distributions (24,921) (1,802) (230)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 11,812 63,699 50,353
Proceeds from shares issued on reinvestment
of dividends and distributions 15,545 1,362 194
Cost of shares repurchased (2,213) (27,291) (2,874)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti 25,144 37,770 47,673
----------- ----------- -----------
Class 2:
Proceeds from shares sold 11,885 43,737 17,199
Proceeds from shares issued on reinvestment
of dividends and distributions 9,376 440 36
Cost of shares repurchased (152) (617) (62)
----------- ----------- -----------
Net increase from Class 2 transactions 21,109 43,560 17,173
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 46,253 81,330 64,846
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 50,464 166,096 62,242
NET ASSETS:
Beginning of period 238,338 72,242 10,000
----------- ----------- -----------
End of period $288,802 $238,338 $72,242
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) ($35) $92 $182
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 678,864 4,749,605 5,351,886
Shares issued on reinvestment of dividends
and distributions 940,440 129,600 23,072
Shares repurchased (127,204) (2,142,344) (355,692)
----------- ----------- -----------
Net increase (decrease) in shares outstanding 1,492,100 2,736,861 5,019,266
============ ============ ============
Class 2:
Shares sold 682,640 3,234,870 1,915,704
Shares issued on reinvestment of dividends
and distributions 567,537 41,588 4,349
Shares repurchased (8,916) (48,695) (7,852)
----------- ----------- -----------
Net increase in shares outstanding 1,241,261 3,227,763 1,912,201
============ ============ ============
Growth Fund
--------------------------------------------------
Period ended Year ended Year ended
December 31, November 30, November 30,
1999 (1) 1999 1998
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) $613 $11,534 $19,359
Net realized gain (loss) on investments 65,111 1,261,163 847,243
Net unrealized appreciation (depreciation)
on investments 1,119,232 1,604,675 296,599
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 1,184,956 2,877,372 1,163,201
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (4,509) (14,657) (16,761)
Class 2 (24 (125)
----------- ----------- -----------
Total dividends from net investment income (4,5 (14,90 (16,886)
Distributions from net realized gain on
investments (1,263,287) (825,168) (580,855)
----------- ----------- -----------
Total dividends and distributions (1,267,796) (840,071) (597,741)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 2,748 96,088 109,347
Proceeds from shares issued on reinvestment
of dividends and distributions 1,116,782 792,389 586,639
Cost of shares repurchased (93,709) (792,339) (589,670)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti 1,025,821 96,138 106,316
----------- ----------- -----------
Class 2:
Proceeds from shares sold 72,052 403,546 195,304
Proceeds from shares issued on reinvestment
of dividends and distributions 151,014 47,682 11,102
Cost of shares repurchased (253) (795) (457)
----------- ----------- -----------
Net increase from Class 2 transactions 222,813 450,433 205,949
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 1,248,634 546,571 312,265
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,165,794 2,583,872 877,725
NET ASSETS:
Beginning of period 8,206,980 5,623,108 4,745,383
----------- ----------- -----------
End of period $9,372,774 $8,206,980 $5,623,108
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) ($67) $4,340 $7,091
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 38,157 1,565,510 2,196,906
Shares issued on reinvestment of dividends
and distributions 16,915,817 15,490,288 13,311,288
Shares repurchased (1,304,881) (12,994,043) (11,951,567)
----------- ----------- -----------
Net increase (decrease) in shares outstanding 15,649,093 4,061,755 3,556,627
============ ============ ============
Class 2:
Shares sold 987,527 6,424,935 3,926,116
Shares issued on reinvestment of dividends
and distributions 2,288,785 933,831 252,355
Shares repurchased (3,525) (13,499) (10,179)
----------- ----------- -----------
Net increase in shares outstanding 3,272,787 7,345,267 4,168,292
============ ============ ============
International
Fund
--------------------------------------------------
Period ended Year ended Year ended
December 31, November 30, November 30,
1999 (1) 1999 1998
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) $1,288 $35,635 $37,231
Net realized gain (loss) on investments 70,792 419,919 47,635
Net unrealized appreciation (depreciation)
on investments 623,662 971,987 335,472
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 695,742 1,427,541 420,338
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (13,966) (43,883) (45,333)
Class 2 (1,113) (2,507) (1,201)
----------- ----------- -----------
Total dividends from net investment income (15,079) (46,390) (46,534)
Distributions from net realized gain on
investments (394,473) (50,248) (272,318)
----------- ----------- -----------
Total dividends and distributions (409,552) (96,638) (318,852)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 3,903 34,895 41,886
Proceeds from shares issued on reinvestment
of dividends and distributions 374,983 91,716 312,120
Cost of shares repurchased (54,835) (435,475) (471,251)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti 324,051 (308,864) (117,245)
----------- ----------- -----------
Class 2:
Proceeds from shares sold 25,293 93,651 68,884
Proceeds from shares issued on reinvestment
of dividends and distributions 34,569 4,922 6,732
Cost of shares repurchased (3,448) (2,045) (1,263)
----------- ----------- -----------
Net increase from Class 2 transactions 56,414 96,528 74,353
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 380,465 (212,336) (42,892)
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 666,655 1,118,567 58,594
NET ASSETS:
Beginning of period 3,837,280 2,718,713 2,660,119
----------- ----------- -----------
End of period $4,503,935 $3,837,280 $2,718,713
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) $680 $15,014 ($375)
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 149,417 1,765,824 2,567,211
Shares issued on reinvestment of dividends
and distributions 15,169,223 5,064,143 21,440,773
Shares repurchased (2,089,938) (22,707,024) (30,137,030)
----------- ----------- -----------
Net increase (decrease) in shares outstanding 13,228,702 (15,877,057) (6,129,046)
============ ============ ============
Class 2:
Shares sold 962,154 4,634,989 4,258,892
Shares issued on reinvestment of dividends
and distributions 1,398,428 269,559 460,573
Shares repurchased (134,060) (104,840) (83,746)
----------- ----------- -----------
Net increase in shares outstanding 2,226,522 4,799,708 4,635,719
============ ============ ============
New World Fund
-------------------------------------
Period ended Period ended
December 31, November 30,
1999 (1) 1999 (3)
---------------------------------- ----------- -----------
OPERATIONS:
Net investment income (loss) $128 $372
Net realized gain (loss) on investments 272 9
Net unrealized appreciation (depreciation)
on investments 7,725 3,445
----------- -----------
Net increase (decrease) in net assets
resulting from operations 8,125 3,826
----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (150) (67)
Class 2 (1 (34)
----------- -----------
Total dividends from net investment income (2 (101)
Distributions from net realized gain on
investments (34) -
----------- -----------
Total dividends and distributions (292) (101)
----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 4,008 25,029
Proceeds from shares issued on reinvestment
of dividends and distributions 169 67
Cost of shares repurchased (76) (440)
----------- -----------
Net increase (decrease) from Class 1 transacti 4,101 24,656
----------- -----------
Class 2:
Proceeds from shares sold 6,314 26,970
Proceeds from shares issued on reinvestment
of dividends and distributions 123 34
Cost of shares repurchased (39) (302)
----------- -----------
Net increase from Class 2 transactions 6,398 26,702
Net increase (decrease) in net ----------- -----------
assets resulting from capital share
transactions 10,499 51,358
----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 18,332 55,083
NET ASSETS:
Beginning of period 65,083 10,000
----------- -----------
End of period $83,415 $65,083
============ ============
Undistributed net investment income (distributions
in excess of net income) $129 $261
============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 353,465 2,519,706
Shares issued on reinvestment of dividends
and distributions 14,709 7,034
Shares repurchased (6,839) (44,653)
----------- -----------
Net increase (decrease) in shares outstanding 361,335 2,482,087
============ ============
Class 2:
Shares sold 555,757 2,709,210
Shares issued on reinvestment of dividends
and distributions 10,726 3,570
Shares repurchased (3,499) (30,258)
----------- -----------
Net increase in shares outstanding 562,984 2,682,522
============ ============
Growth-
Income Fund
--------------------------------------------------
Period ended Year ended Year ended
December 31, November 30, November 30,
1999 (1) 1999 1998
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) $13,929 $132,880 $119,829
Net realized gain (loss) on investments 112,696 1,254,871 1,068,839
Net unrealized appreciation (depreciation)
on investments 116,969 (469,846) (236,509)
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 243,594 917,905 952,159
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (30,097) (115,275) (115,861)
Class 2 (4,6 (11,45 (5,220)
----------- ----------- -----------
Total dividends from net investment income (34,7 (126,72 (121,081)
Distributions from net realized gain on
investments (1,257,729) (1,064,215) (633,062)
----------- ----------- -----------
Total dividends and distributions (1,292,471) (1,190,940) (754,143)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 1,257 30,036 79,575
Proceeds from shares issued on reinvestment
of dividends and distributions 1,097,689 1,093,525 730,769
Cost of shares repurchased (113,133) (1,041,360) (713,841)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti 985,813 82,201 96,503
----------- ----------- -----------
Class 2:
Proceeds from shares sold 57,496 474,135 363,643
Proceeds from shares issued on reinvestment
of dividends and distributions 194,782 97,415 23,374
Cost of shares repurchased (549) (2,294) (829)
----------- ----------- -----------
Net increase from Class 2 transactions 251,729 569,256 386,188
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 1,237,542 651,457 482,691
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 188,665 378,422 680,707
NET ASSETS:
Beginning of period 7,646,139 7,267,717 6,587,010
----------- ----------- -----------
End of period $7,834,804 $7,646,139 $7,267,717
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) $13,714 $34,526 $28,393
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 35,851 774,972 2,066,094
Shares issued on reinvestment of dividends
and distributions 34,671,173 30,452,267 20,193,738
Shares repurchased (3,155,701) (26,889,197) (18,531,056)
----------- ----------- -----------
Net increase (decrease) in shares outstanding 31,551,323 4,338,042 3,728,776
============ ============ ============
Class 2:
Shares sold 1,563,119 12,167,829 9,296,520
Shares issued on reinvestment of dividends
and distributions 6,154,235 2,709,787 643,598
Shares repurchased (16,395) (59,137) (23,804)
----------- ----------- -----------
Net increase in shares outstanding 7,700,959 14,818,479 9,916,314
============ ============ ============
Asset
Allocation Fund
--------------------------------------------------
Period ended Year ended Year ended
December 31, November 30, November 30,
1999 (1) 1999 1998
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) $ 5,313 $ 59,629 $ 57,128
Net realized gain (loss) on investments (2,150) 108,464 115,877
Net unrealized appreciation (depreciation)
on investments 21,367 (42,237) 6,383
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 24,530 125,856 179,388
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (12,197) (51,835) (51,238)
Class 2 (2,7 (7,68 (3,336)
----------- ----------- -----------
Total dividends from net investment income (14,9 (59,51 (54,574)
Distributions from net realized gain on
investments (108,804) (115,203) (78,277)
----------- ----------- -----------
Total dividends and distributions (123,743) (174,721) (132,851)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 945 16,085 55,514
Proceeds from shares issued on reinvestment
of dividends and distributions 99,814 154,558 126,847
Cost of shares repurchased (27,140) (231,188) (120,895)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti 73,619 (60,545) 61,466
----------- ----------- -----------
Class 2:
Proceeds from shares sold 16,286 138,364 121,817
Proceeds from shares issued on reinvestment
of dividends and distributions 23,929 20,163 6,004
Cost of shares repurchased (1,014) (5,215) (195)
----------- ----------- -----------
Net increase from Class 2 transactions 39,201 153,312 127,626
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 112,820 92,767 189,092
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 13,607 43,902 235,629
NET ASSETS:
Beginning of period 1,714,513 1,670,611 1,434,982
----------- ----------- -----------
End of period $1,728,120 $1,714,513 $1,670,611
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) $5,116 $14,824 $14,723
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 61,842 1,006,722 3,472,672
Shares issued on reinvestment of dividends
and distributions 6,831,915 9,936,348 8,206,467
Shares repurchased (1,747,496) (14,375,597) (7,525,015)
----------- ----------- -----------
Net increase (decrease) in shares outstanding 5,146,261 (3,432,527) 4,154,124
============ ============ ============
Class 2:
Shares sold 1,035,600 8,584,297 7,514,429
Shares issued on reinvestment of dividends
and distributions 1,637,814 1,294,397 385,691
Shares repurchased (66,355) (326,832) (12,673)
----------- ----------- -----------
Net increase in shares outstanding 2,607,059 9,551,862 7,887,447
============ ============ ============
Bond Fund
--------------------------------------------------
Period ended Year ended Year ended
December 31, November 30, November 30,
1999 (1) 1999 1998
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) $1,621 $17,076 $12,668
Net realized gain (loss) on investments (155) (1,349) 1,054
Net unrealized appreciation (depreciation)
on investments 50 (10,336) (4,888)
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 1,516 5,391 8,834
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (3,003) (12,348) (9,573)
Class 2 (1,4 (3,82 (1,605)
----------- ----------- -----------
Total dividends from net investment income (4,4 (16,17 (11,178)
Distributions from net realized gain on
investments (1,080) (1,717)
----------- ----------- -----------
Total dividends and distributions (4,425) (17,256) (12,895)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 226 23,707 64,860
Proceeds from shares issued on reinvestment
of dividends and distributions 3,003 13,208 11,132
Cost of shares repurchased (5,507) (40,585) (18,584)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti (2,278) (3,670) 57,408
----------- ----------- -----------
Class 2:
Proceeds from shares sold 5,106 37,873 33,674
Proceeds from shares issued on reinvestment
of dividends and distributions 1,422 4,048 1,763
Cost of shares repurchased (424) (4,348) (1,431)
----------- ----------- -----------
Net increase from Class 2 transactions 6,104 37,573 34,006
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 3,826 33,903 91,414
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 917 22,038 87,353
NET ASSETS:
Beginning of period 253,317 231,279 143,926
----------- ----------- -----------
End of period $254,234 $253,317 $231,279
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) $1,580 $4,385 $3,506
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 22,935 2,350,427 6,220,296
Shares issued on reinvestment of dividends
and distributions 308,959 1,326,283 1,070,589
Shares repurchased (559,581) (4,049,517) (1,789,981)
----------- ----------- -----------
Net increase (decrease) in shares outstanding (227,687) (372,807) 5,500,904
============ ============ ============
Class 2:
Shares sold 517,185 3,794,942 3,219,589
Shares issued on reinvestment of dividends
and distributions 146,356 407,478 169,961
Shares repurchased (43,351) (435,922) (137,744)
----------- ----------- -----------
Net increase in shares outstanding 620,190 3,766,498 3,251,806
============ ============ ============
High-Yield
Bond Fund
--------------------------------------------------
Period ended Year ended Year ended
December 31, November 30, November 30,
1999 (1) 1999 1998
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) $5,386 $66,908 $70,319
Net realized gain (loss) on investments (922) (13,757) 6,948
Net unrealized appreciation (depreciation)
on investments 7,971 (22,449) (66,774)
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 12,435 30,702 10,493
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (13,126) (64,228) (65,776)
Class 2 (2,1 (7,68 (3,726)
----------- ----------- -----------
Total dividends from net investment income (15,2 (71,91 (69,502)
Distributions from net realized gain on
investments (10,695) (8,320)
----------- ----------- -----------
Total dividends and distributions (15,264) (82,607) (77,822)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 1,744 18,289 45,293
Proceeds from shares issued on reinvestment
of dividends and distributions 13,126 73,957 73,843
Cost of shares repurchased (15,279) (171,534) (107,252)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti (409) (79,288) 11,884
----------- ----------- -----------
Class 2:
Proceeds from shares sold 3,289 30,578 49,128
Proceeds from shares issued on reinvestment
of dividends and distributions 2,138 8,650 3,979
Cost of shares repurchased (940) (6,260) (1,418)
----------- ----------- -----------
Net increase from Class 2 transactions 4,487 32,968 51,689
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 4,078 (46,320) 63,573
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,249 (98,225) (3,756)
NET ASSETS:
Beginning of period 684,077 782,302 786,058
----------- ----------- -----------
End of period $685,326 $684,077 $782,302
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) $4,014 $13,841 $17,744
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 136,572 1,381,259 3,143,506
Shares issued on reinvestment of dividends
and distributions 1,034,422 5,670,708 5,138,832
Shares repurchased (1,188,364) (12,975,153) (7,540,786)
----------- ----------- -----------
Net increase (decrease) in shares outstanding (17,370) (5,923,186) 741,552
============ ============ ============
Class 2:
Shares sold 254,659 2,325,235 3,361,669
Shares issued on reinvestment of dividends
and distributions 168,481 665,715 280,937
Shares repurchased (73,302) (480,054) (105,506)
----------- ----------- -----------
Net increase in shares outstanding 349,838 2,510,896 3,537,100
============ ============ ============
U.S. Government/
AAA-Rated
Securities Fund
--------------------------------------------------
Period ended Year ended Year ended
December 31, November 30, November 30,
1999 (1) 1999 1998
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) $2,476 $32,028 $30,885
Net realized gain (loss) on investments (450) (3,881) 4,748
Net unrealized appreciation (depreciation)
on investments (3,972) (27,213) 5,763
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations (1,946) 934 41,396
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (6,962) (30,055) (29,472)
Class 2 (7 (2,22 (938)
----------- ----------- -----------
Total dividends from net investment income (7,7 (32,28 (30,410)
Distributions from net realized gain on
investments - - -
----------- ----------- -----------
Total dividends and distributions (7,718) (32,282) (30,410)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 941 27,407 97,521
Proceeds from shares issued on reinvestment
of dividends and distributions 6,961 30,055 29,472
Cost of shares repurchased (10,015) (133,690) (71,432)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti (2,113) (76,228) 55,561
----------- ----------- -----------
Class 2:
Proceeds from shares sold 1,753 22,324 26,930
Proceeds from shares issued on reinvestment
of dividends and distributions 757 2,227 938
Cost of shares repurchased (358) (7,625) (3,235)
----------- ----------- -----------
Net increase from Class 2 transactions 2,152 16,926 24,633
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 39 (59,302) 80,194
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS (9,625) (90,650) 91,180
NET ASSETS:
Beginning of period 478,179 568,829 477,649
----------- ----------- -----------
End of period $468,554 $478,179 $568,829
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) $2,310 $7,682 $7,936
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 87,758 2,460,496 8,582,116
Shares issued on reinvestment of dividends
and distributions 659,229 2,735,646 2,630,834
Shares repurchased (935,749) (12,168,746) (6,349,283)
----------- ----------- -----------
Net increase (decrease) in shares outstanding (188,762) (6,972,604) 4,863,667
============ ============ ============
Class 2:
Shares sold 162,396 2,025,288 2,379,800
Shares issued on reinvestment of dividends
and distributions 71,621 203,277 83,414
Shares repurchased (33,738) (691,609) (287,245)
----------- ----------- -----------
Net increase in shares outstanding 200,279 1,536,956 2,175,969
============ ============ ============
Cash Management
Fund
--------------------------------------------------
Period ended Year ended Year ended
December 31, November 30, November 30,
1999 (1) 1999 1998
---------------------------------- ----------- ----------- -----------
OPERATIONS:
Net investment income (loss) $1,610 $14,942 $13,045
Net realized gain (loss) on investments - - 1
Net unrealized appreciation (depreciation)
on investments 2 (3) -
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 1,612 14,939 13,046
----------- ----------- -----------
DIVIDENDS AND DISTRIBUTIONS
PAID TO SHAREHOLDERS:
Dividends from net investment income:
Class 1 (3,707) (13,032) (11,431)
Class 2 (526) (1,66 (984)
----------- ----------- -----------
Total dividends from net investment income (4,233) (14,69 (12,415)
Distributions from net realized gain on
investments - - -
----------- ----------- -----------
Total dividends and distributions (4,233) (14,699) (12,415)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class 1:
Proceeds from shares sold 19,537 282,973 269,818
Proceeds from shares issued on reinvestment
of dividends and distributions 3,707 13,032 11,431
Cost of shares repurchased (10,257) (239,463) (258,426)
----------- ----------- -----------
Net increase (decrease) from Class 1 transacti 12,987 56,542 22,823
----------- ----------- -----------
Class 2:
Proceeds from shares sold 4,545 41,842 40,995
Proceeds from shares issued on reinvestment
of dividends and distributions 526 1,667 984
Cost of shares repurchased (4,794) (29,551) (21,792)
----------- ----------- -----------
Net increase from Class 2 transactions 277 13,958 20,187
Net increase (decrease) in net ----------- ----------- -----------
assets resulting from capital share
transactions 13,264 70,500 43,010
----------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 10,643 70,740 43,641
NET ASSETS:
Beginning of period 354,256 283,516 239,875
----------- ----------- -----------
End of period $364,899 $354,256 $283,516
============ ============ ============
Undistributed net investment income (distributions
in excess of net income) $1,592 $4,215 $3,971
============ ============ ============
SHARES OF BENEFICIAL INTEREST:
Class 1:
Shares sold 1,759,589 25,510,844 24,352,691
Shares issued on reinvestment of dividends
and distributions 336,087 1,182,023 1,037,352
Shares repurchased (922,781) (21,593,174) (23,299,957)
----------- ----------- -----------
Net increase (decrease) in shares outstanding 1,172,895 5,099,693 2,090,086
============ ============ ============
Class 2:
Shares sold 409,857 3,773,972 3,700,810
Shares issued on reinvestment of dividends
and distributions 47,642 151,230 89,256
Shares repurchased (431,087) (2,666,463) (1,966,921)
----------- ----------- -----------
Net increase in shares outstanding 26,412 1,258,739 1,823,145
============ ============ ============
(1) Represents the one month ended December 31, 1999.
(2) For the period April 30, 1998, commencement
of operations, through November 30, 1998.
(3) For the period June 17, 1999, commencement
of operations, through November 30, 1999.
(4) Represents initial capitalization from the sale
of 1,000,000 Class 1 shares of beneficial interest.
See Notes to Financial Statements
</TABLE>
Notes to Financial Statements
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION - American Variable Insurance Series (the "series") is registered
under the Investment Company Act of 1940 as an open-end, diversified management
investment company with 11 different funds. The 11th fund, the New World Fund,
commenced operations on June 17, 1999. The assets of each fund are segregated,
with each fund accounted for separately. The funds' investment objectives are
as follows: Global Growth Fund - growth of capital by investing primarily in
common stocks or securities with common stock characteristics of issuers
domiciled around the world; Global Small Capitalization Fund - long-term growth
of capital by investing primarily in smaller companies in the United States and
around the world; Growth Fund - growth of capital by investing primarily in
common stocks or securities with common stock characteristics; New World Fund -
long-term growth of capital by investing primarily in stocks of companies with
significant exposure to countries which have developing economies and/or
markets. International Fund - long-term growth of capital by investing
primarily in securities of issuers domiciled outside the United States;
Growth-Income Fund - growth of capital and income by investing primarily in
common stocks or other securities which demonstrate the potential for
appreciation and/or dividends; Asset Allocation Fund - high total return
(including income and capital gains) consistent with long-term preservation of
capital; Bond Fund - as high a level of current income as is consistent with
the preservation of capital by investing primarily in fixed-income securities;
High-Yield Bond Fund - high current income and, secondarily, capital
appreciation by investing primarily in intermediate and long-term corporate
obligations, with emphasis on higher yielding, higher risk, lower rated or
unrated securities; U.S. Government/AAA-Rated Securities Fund - a high level of
current income consistent with prudent investment risk and preservation of
capital by investing primarily in a combination of securities guaranteed by the
U.S. government and other debt securities rated AAA or Aaa; Cash Management
Fund - high current yield while preserving capital by investing in a
diversified selection of high-quality money market instruments.
Each fund offers Class 1 and Class 2 shares. Class 1 shares are not subject
to either an initial or contingent deferred sales charge nor have they adopted
a plan of distribution to cover any distribution expenses. Class 2 shares are
subject to certain fees pursuant to a Plan of Distribution. Holders of both
classes of shares have identical voting, dividend, liquidation and other rights
and shall have exclusive rights to vote on matters affecting only their
classes. The shares of each class represent an interest in the same portfolio
of investments of each fund.
SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been prepared
in conformity with generally accepted accounting principles which require
management to make estimates and assumptions that affect the reported amounts
and disclosures in the financial statements. Actual results could differ from
those estimates. The series' year-end changed from November 30 to December 31
effective December 1, 1999. The following is a summary of the significant
accounting policies consistently followed by the series in the preparation of
its financial statements:
SECURITY VALUATION - Equity securities, including depositary receipts, are
valued at the last reported sale price on the exchange or market on which such
securities are traded, as of the close of business on the day the securities
are being valued or, lacking any sales, at the last available bid price. In
cases where equity securities are traded on more than one exchange, the
securities are valued on the exchange or market determined by the investment
adviser to be the broadest and most representative market, which may be either
a securities exchange or the over-the-counter market. Fixed-income securities
are valued at prices obtained from a pricing service, when such prices are
available; however, in circumstances where the investment adviser deems it
appropriate to do so, such securities will be valued at the mean quoted bid and
asked prices or at prices for securities of comparable maturity, quality and
type. The ability of the issuers of the debt securities held by the series to
meet their obligations may be affected by economic developments in a specific
industry, state or region. Short-term securities maturing within 60 days are
valued at amortized cost, which approximates market value. Forward currency
contracts are valued at the mean of their representative quoted bid and asked
prices. Securities and assets for which representative market quotations are
not readily available are valued at fair value as determined in good faith by a
committee appointed by the Board of Trustees.
NON-U.S. CURRENCY TRANSLATION - Assets and liabilities initially expressed in
terms of non-U.S. currencies are translated into U.S. dollars at the prevailing
market rates at the end of the reporting period. Purchases and sales of
securities and income and expenses are translated into U.S. dollars at the
prevailing market rates on the dates of such transactions. The effects of
changes in non-U.S. currency exchange rates on investment securities and other
assets and liabilities are included with the net realized and unrealized gain
or loss on investment securities.
SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions are
accounted for as of the trade date. Realized gains and losses from securities
transactions are determined based on specific identified cost. In the event
securities are purchased on a delayed delivery or "when-issued" basis, the
series will instruct the custodian to segregate liquid assets sufficient to
meet its payment obligations in these transactions. Dividend income is
recognized on the ex-dividend date, and interest income is recognized on an
accrual basis. Market discounts, premiums and original issue discounts on
securities purchased are amortized daily over the expected life of the
security.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS - Dividends and distributions paid
to shareholders are recorded on the ex-dividend date.
FORWARD CURRENCY CONTRACTS - The series may enter into forward currency
contracts, which represent agreements to exchange currencies of different
countries at specified future dates at specified rates. The series enters into
these contracts to manage its exposure to fluctuations in foreign exchange
rates arising from investments denominated in non-U.S. currencies. The series'
use of forward currency contracts involves market risk in excess of the amount
recognized in the statement of assets and liabilities. The contracts are
recorded in the statement of assets and liabilities at their net unrealized
value. The series records realized gains or losses at the time the forward
contract is closed or offset by a matching contract. The face or contract
amount in U.S. dollars reflects the total exposure the series has in that
particular contract. Risks may arise upon entering these contracts from the
potential inability of counterparties to meet the terms of their contracts and
from possible movements in non-U.S. exchange rates and securities values
underlying these instruments. Purchases and sales of forward currency exchange
contracts having the same settlement date and broker are offset and presented
net in the statement of assets and liabilities.
CLASS ALLOCATIONS - Income, expenses (other than class-specific expenses) and
realized and unrealized gains and losses are prorated between the classes based
on the relative net assets of each class. Distribution and any other
class-specific expenses, if any, are calculated daily at the class level based
on the relative daily net assets of each class and the specific expense rate
applicable to each class.
2. NON-U.S. INVESTMENTS
INVESTMENT RISK - Investments in securities of non-U.S. issuers in certain
countries involve special investment risks. These risks may include, but are
not limited to, investment and repatriation restrictions, revaluation of
currencies, adverse political, social, and economic developments, government
involvement in the private sector, limited and less reliable investor
information, lack of liquidity, certain local tax law considerations, and
limited regulation of the securities markets.
TAXATION - Dividend and Interest income is recorded net of non-U.S. taxes paid.
3. FEDERAL INCOME TAXATION - Each fund in the series intends to comply with
the requirements of the Internal Revenue Code applicable to regulated
investment companies and intends to distribute all of its net taxable income
and net capital gains for the fiscal period. As a regulated investment company,
each fund in the series is not subject to income taxes if such distributions
are made. Required distributions are determined on a tax basis and may differ
from net investment income and net realized gains for financial reporting
purposes. In addition, the fiscal year in which amounts are distributed may
differ from the year in which the net investment income and net realized gains
are recorded by the funds.
The Bond Fund, the High-Yield Bond Fund, and the U.S. Government/AAA-Rated
Securities Fund had net capital loss carryforwards available at December 31,
1999 and at November 30, 1999. The Asset Allocation Fund had a net capital
loss carryforward available at December 31, 1999. These amounts may be used to
offset capital gains realized during subsequent years expiring December 31,
2003 through 2007, and thereby relieve the fund and its shareholders of any
federal income tax liability with respect to the capital gains that are so
offset. The funds will not make distributions from capital gains while a
capital loss carryforward remains.
Tax basis disclosures as of and for the one month ended December 31, 1999 and
as of and for the year ended November 30, 1999 are as follows:
<TABLE>
<S> <C> <C> <C> <C>
(dollars in
Global Global Small thousands)
Growth Capitalization Growth International
Fund Fund Fund Fund
As of and for the one-month period
Ended December 31, 1999:
For the one month
ended December 31, 1999:
Net capital gain (loss) $ 7,97 $ 8,25 $ 65,10 $ 70,763
Net currency gain (loss) 29
As of December 31, 1999 (excluding
forward currency contracts):
Unrealized
appreciation 284,23 91,69 4,613,55 2,253,753
Unrealized
depreciation 19,53 13,35 265,15 43,190
Net unrealized
appreciation
(depreciation) 264,69 78,34 4,348,39 2,210,563
Cost of portfolio
securities 460,36 210,08 5,026,39 2,292,163
Capital loss carryforward at
December 31, 1999 -
As of and for the year ended
November 30, 1999:
For the year
ended November 30, 1999:
Net capital gain (loss) $ 28,85 $ 24,69 $ 1,260,93 $ 395,686
Net currency gain (loss) 3 22 (7)
Losses during the period
November 1, 1999 to
November 30, 1999 deferred to
fiscal period ending
December 31,1999 related to
the following:
Currency - -
Capital gains - -
As of November 30, 1999 (excluding
forward currency contracts):
Unrealized
appreciation 183,39 70,06 3,561,22 1,650,486
Unrealized
depreciation 21,56 12,62 332,07 63,586
Net unrealized
appreciation
(depreciation) 161,83 57,44 3,229,14 1,586,900
Cost of portfolio
securities 440,18 182,72 5,033,49 2,244,736
Capital loss carryforward at
November 30, 1999 -
(dollars in
thousands)
New Growth- Asset
World Income Allocation Bond
Fund Fund Fund Fund
As of and for the one-month period
Ended December 31, 1999:
For the one month
ended December 31, 1999:
Net capital gain (loss) $ 27 $ 112,69 $ (2,15 $ (154)
Net currency gain (loss) ( (2)
As of December 31, 1999 (excluding
forward currency contracts):
Unrealized
appreciation 12,75 1,849,34 373,63 4,134
Unrealized
depreciation 1,58 735,96 116,63 16,210
Net unrealized
appreciation
(depreciation) 11,17 1,113,37 257,00 (12,076)
Cost of portfolio
securities 71,65 6,715,43 1,463,07 262,762
Capital loss carryforward at
December 31, 1999 2,15 1,500
As of and for the year ended
November 30, 1999:
For the year
ended November 30, 1999:
Net capital gain (loss) 19 * $ 1,254,89 $ 108,47 $ (1,346)
Net currency gain (loss) (10)* (2 (1 (21)
Losses during the period
November 1, 1999 to
November 30, 1999 deferred to
fiscal period ending
December 31,1999 related to
the following:
Currency 1
Capital gains -
As of November 30, 1999 (excluding
forward currency contracts):
Unrealized
appreciation 6,06 1,686,83 344,10 3,495
Unrealized
depreciation 2,62 690,43 108,47 15,620
Net unrealized
appreciation
(depreciation) 3,44 996,40 235,63 (12,125)
Cost of portfolio
securities 63,48 6,660,33 1,479,34 261,075
Capital loss carryforward at
November 30, 1999 1,346
(dollars in
thousands)
High-Yiel U.S. Government Cash
Bond AAA-Rated Management
Fund Securities Fund Fund
As of and for the one-month period
Ended December 31, 1999:
For the one month
ended December 31, 1999:
Net capital gain (loss) $ (97 $ (73 -
Net currency gain (loss) (11 -
As of December 31, 1999 (excluding
forward currency contracts):
Unrealized
appreciation 51,35 72 $ 1
Unrealized
depreciation 105,42 16,36 2
Net unrealized
appreciation
(depreciation) (54,07 (15,64 (1)
Cost of portfolio
securities 729,24 480,66 365,701
Capital loss carryforward at
December 31, 1999 19,70 19,85 -
As of and for the year ended
November 30, 1999:
For the year
ended November 30, 1999:
Net capital gain (loss) $ (18,72 $ (3,59 -
Net currency gain (loss) 1,40 -
Losses during the period
November 1, 1999 to
November 30, 1999 deferred to
fiscal period ending
December 31,1999 related to
the following:
Currency -
Capital gains 28 -
As of November 30, 1999 (excluding
forward currency contracts):
Unrealized
appreciation 42,03 1,59 -
Unrealized
depreciation 104,23 13,25 $ 3
Net unrealized
appreciation
(depreciation) (62,19 (11,66 (3)
Cost of portfolio
securities 735,08 482,11 355,124
Capital loss carryforward at
November 30, 1999 18,72 19,12 -
* For the period
June 17, 1999,
commencement of operations,
through November 30, 1999.
</TABLE>
4. FEES AND TRANSACTIONS WITH RELATED PARTIES
INVESTMENT ADVISORY FEE - The fees for management services were incurred
pursuant to an agreement with Capital Research and Management Company (CRMC),
with which certain officers and Trustees of the series are affiliated. The
Investment Advisory and Service Agreement provides for monthly fees, accrued
daily, based on the following annual rates: Global Growth Fund - 0.69% of the
first $600 million of average net assets; 0.59% of such assets in excess of
$600 million but not exceeding $1.2 billion; and 0.53% of such assets in excess
of $1.2 billion; Global Small Capitalization Fund - 0.80% of the first $600
million of average net assets; and 0.74% of such assets in excess of $600
million; Growth Fund - 0.50% of the first $600 million of average net assets;
0.45% of such assets in excess of $600 million but not exceeding $1.2 billion;
0.42% of such assets in excess of $1.2 billion but not exceeding $2.0 billion;
0.37% of such assets in excess of $2.0 billion but not exceeding $3.2 billion;
0.35% of such assets in excess of $3.2 billion but not exceeding $5.2 billion;
0.33% of such assets in excess of $5.2 billion but not exceeding $8.4 billion;
and 0.315% of such assets in excess of $8.4 billion; International Fund -0.78%
of the first $600 million of average net assets; 0.60% of such assets in excess
of $600 million but not exceeding $1.2 billion; 0.48% of such assets in excess
of $1.2 billion but not exceeding $2.0 billion; and 0.465% of such assets in
excess of $2.0 billion; New World Fund - 0.85% of average net assets;
Growth-Income Fund - 0.50% of the first $600 million of average net assets;
0.45% of such assets in excess of $600 million but not exceeding $1.5 billion;
0.40% of such assets in excess of $1.5 billion but not exceeding $2.5 billion;
0.32% of such assets in excess of $2.5 billion but not exceeding $4.0 billion;
0.285% of such assets in excess of $4.0 billion but not exceeding $6.5 billion;
0.256% of such assets in excess of $6.5 billion but not exceeding $10.5
billion; and 0.242% of such assets in excess of $10.5 billion; Asset Allocation
Fund - 0.50% of the first $600 million of average net assets; 0.42% of such
assets in excess of $600 million but not exceeding $1.2 billion; 0.36% of such
assets in excess of $1.2 billion but not exceeding $2.0 billion; and 0.32% of
such assets in excess of $2.0 billion; Bond Fund - 0.60% of the first $30
million of average net assets; and 0.50% of such assets in excess of $30
million; High-Yield Bond Fund - 0.60% of the first $30 million of average net
assets; 0.50% of such assets in excess of $30 million but not exceeding $600
million; and 0.46% of such assets in excess of $600 million; U.S.
Government/AAA-Rated Securities Fund - 0.60% of the first $30 million of
average net assets; 0.50% of such assets in excess of $30 million but not
exceeding $600 million; and 0.40% of such assets in excess of $600 million;
Cash Management Fund - 0.50% of the first $100 million of average net assets;
0.42% of such assets in excess of $100 million but not exceeding $400 million;
and 0.38% of such assets in excess of $400 million.
DISTRIBUTION EXPENSES - Pursuant to a Plan of Distribution, each fund may
expend 0.25% of the average daily net assets of Class 2 shares in connection
with certain distribution services and related activities. During the one
month ended December 31, 1999 and the year ended November 30, 1999,
distribution expenses under the Plan for the series aggregated $765,000 and
$5,710,000 respectively. As of December 31, 1999 and November 30, 1999,
accrued and unpaid distribution expenses were $765,000 and $671,000,
respectively.
DEFERRED TRUSTEES' FEES - Trustees who are unaffiliated with CRMC may elect to
defer part or all of the fees earned for services as members of the Board.
Amounts deferred are not funded and are general unsecured liabilities of the
series. As of December 31, 1999 and November 30, 1999, aggregate deferred
amounts and earnings thereon since the deferred compensation plan's adoption
(1993) net of any payments to Trustees, were $694,000 and $628,000,
respectively. Certain Trustees and officers of the series are or may be
considered to be affiliated with CRMC. No such persons received any
remuneration directly from the series.
5. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES
The following table presents additional information as of and for the periods
ended December 31, 1999 and November 30, 1999:
<TABLE>
(dollars in
<S> <C> <C> <C> <C>
thousands)
Global Global Small
Growth Capitalization Growth Interna-
Fund Fund Fund tional Fund
As of and for the one month period
ended December 31, 1999:
For the month
ended December 31,1999:
Purchases of
investment
securities (1) $ 17,49 $ 32,64 $ 268,85 $ 57,137
Sales of invest-
ment securities (1) 15,99 15,77 211,81 149,840
Non-U.S taxes withheld on
dividend and interest income 2 277
Book basis net currency
gain (loss) on dividends,
interest, sales of
non-U.S. bonds, forward currency
contracts, and other receivables
and payables 29
As of December 31, 1999:
Accumulated
undistributed
net realized
gain (loss) on
investments 7,97 8,06 65,10 70,763
Reclassification from (to)
undistributed net investment
income to (from)undistributed
net realized gain 17 ( 51 543
Paid-in capital 455,11 202,42 4,959,34 2,221,997
As of and for the year ended
November 30, 1999:
For the year
ended November 30,1999:
Purchases of
investment
securities (1) $ 245,15 $ 166,68 $2,408,19 $ 1,217,049
Sales of invest-
ment securities (1) 87,80 95,38 2,755,32 1,537,097
Non-U.S taxes withheld on
dividend and interest income 28 5 5,367
Book basis net currency
gain (loss) on dividends,
interest, sales of
non-U.S. bonds, forward currency
contracts and other receivables
and payables 3 22 (208)
As of November 30, 1999:
Accumulated
undistributed
net realized
gain (loss) on
investments 28,66 24,63 1,262,76 393,901
Reclassification from (to)
undistributed net investment
income to (from)undistributed
net realized gain (3 ( (61 (26,144)
Paid-in capital 395,69 156,17 3,710,70 1,841,532
New Growth- Asset
World Income Allocatio Bond
Fund Fund Fund Fund
As of and for the one month period
ended December 31, 1999:
For the month
ended December 31,1999:
Purchases of
investment
securities (1) $ 4,99 $ 182,07 $ 27,75 $ 12,417
Sales of invest-
ment securities (1) 1,49 245,06 22,49 16,510
Non-U.S taxes withheld on
dividend and interest income - -
Book basis net currency
gain (loss) on dividends,
interest, sales of
non-U.S. bonds, forward currency
contracts, and other receivables
and payables ( (1)
As of December 31, 1999:
Accumulated
undistributed
net realized
gain (loss) on
investments 25 112,95 (2,15 (1,500)
Reclassification from (to)
undistributed net investment
income to (from)undistributed
net realized gain ( 8 1
Paid-in capital 71,85 6,594,76 1,468,15 266,238
As of and for the year ended
November 30, 1999:
For the year
ended November 30,1999:
Purchases of
investment
securities (1) $ 49,16 $ 2,765,69 $ 573,97 $ 115,202
Sales of invest-
ment securities (1) 23 3,323,95 591,35 85,155
Non-U.S taxes withheld on
dividend and interest income -
Book basis net currency
gain (loss) on dividends,
interest, sales of
non-U.S. bonds, forward currency
contracts and other receivables
and payables (1 (2 (3 (152)
As of November 30, 1999:
Accumulated
undistributed
net realized
gain (loss) on
investments 1 1,257,98 108,72 (1,346)
Reclassification from (to)
undistributed net investment
income to (from)undistributed
net realized gain 1 2 1 21
Paid-in capital 61,35 5,357,22 1,355,33 262,412
High-Yiel U.S. Government Cash
Bond AAA-Rated Management
Fund Securities Fund Fund
As of and for the one month period
ended December 31, 1999:
For the month
ended December 31,1999:
Purchases of
investment
securities (1) $ 10,37 $ 8,53 -
Sales of invest-
ment securities (1) 8,70 17,06 -
Non-U.S taxes withheld on
dividend and interest income -
Book basis net currency
gain (loss) on dividends,
interest, sales of
non-U.S. bonds, forward currency
contracts, and other receivables
and payables ( -
As of December 31, 1999:
Accumulated
undistributed
net realized
gain (loss) on
investments (19,70 (19,85 -
Reclassification from (to)
undistributed net investment
income to (from)undistributed
net realized gain (5 13 -
Paid-in capital 754,90 501,74 $ 363,308
As of and for the year ended
November 30, 1999:
For the year
ended November 30,1999:
Purchases of
investment
securities (1) $ 214,02 $ 296,42 -
Sales of invest-
ment securities (1) 281,57 343,12 -
Non-U.S taxes withheld on
dividend and interest income -
Book basis net currency
gain (loss) on dividends,
interest, sales of
non-U.S. bonds, forward currency
contracts and other receivables
and payables (37 -
As of November 30, 1999:
Accumulated
undistributed
net realized
gain (loss) on
investments (18,72 (19,53 -
Reclassification from (to)
undistributed net investment
income to (from)undistributed
net realized gain (1,10 $ (1)
Paid-in capital 750,82 501,70 350,044
(1) Excludes short-
term securities
(2) For the period
June 17, 1999,
commencement of operations,
through November 30, 1999.
</TABLE>
Pursuant to the custodian agreement, each fund within the series receives
credits against its custodian fee for imputed interest on certain balances with
the custodian bank. For the one month ended December 31, 1999 and the year
ended November 30, 1999, custodian fees for the series aggregated $224,000 and
$2,033,000, respectively, of which $11,000 and $94,000, respectively, were paid
by these credits rather than in cash.
The High-Yield Bond Fund had outstanding forward currency contracts to sell
non-U.S. currencies as follows:
<TABLE>
<S> <C> <C> <C> <C>
Non-U.S. Currency Sale Contracts
Contract
Amount
---------------
Fund Non-U.S. U.S.
--------------- -------------- ---------------
At December 31, 1999: Euro
expiring High-Yield Bond 4,330,00 4,549,000
1/24-2/24/2000
British Pounds
expiring High-Yield Bond 6,696,00 10,831,000
2/1-3/17/2000
At November 30, 1999: Euro
expiring High-Yield Bond 4,330,00 4,596,000
12/6/1999-2/24/2000
British Pounds
expiring High-Yield Bond 6,696,00 10,838,000
12/17/1999-2/10/2000
U.S.
Valuation
-----------------
Unrealized
Appreciation
Fund Amount (Depreciation)
--------------- -------------- ---------------
At December 31, 1999: Euro
expiring High-Yield Bond 4,372,00 177,000
1/24-2/24/2000
British Pounds
expiring High-Yield Bond 10,821,00 10,000
2/1-3/17/2000
At November 30, 1999: Euro
expiring High-Yield Bond 4,382,00 214,000
12/6/1999-2/24/2000
British Pounds
expiring High-Yield Bond 10,698,00 140,000
12/17/1999-2/10/2000
</TABLE>
<TABLE>
PER-SHARE
DATA AND
RATIOS
<S> <C> <C> <C> <C> <C> <C> <C>
Net gains
(losses) on
securitie Total DividendDistri-
Net asse Net (both from (from nebutions
value, invest- realized invest- invest- (from Total
Year beginnin ment and ment ment capital distri-
Ended (1) of year income unrealizeoperationincome) gains) butions
--------- -----------------------------------------------------------
Global Growth Fund (2)
Class 1
11/30/1997 $10.00 $.06 $ .59 $ .65 $(.03) - $(.03)
11/30/1998 10.62 .13 2.43 2.56 (.14) $(.02) (.16)
11/30/1999 13.02 .14 6.39 6.53 (.12) (.44) (.56)
12/31/1999 18.99 .01 3.43 3.44 (.11) (.90) (1.01)
Class 2
11/30/1997 10.00 .03 .60 .63 (.02) - (.02)
11/30/1998 10.61 .10 2.44 2.54 (.11) (.02) (.13)
11/30/1999 13.02 .11 6.37 6.48 (.08) (.44) (.52)
12/31/1999 18.98 .01 3.42 3.43 (.10) (.90) (1.00)
Global Small
Capitalization Fund (4)
Class 1
11/30/1998 $10.00 $.07 $(.92) $(.85) $(.04) - $(.04)
11/30/1999 9.11 .06 8.20 8.26 (.08) $(.13) (.21)
12/31/1999 17.16 - 1.92 1.92 (.01) (1.70) (1.71)
Class 2
11/30/1998 10.00 .04 (.91) (.87) (.03) - (.03)
11/30/1999 9.10 .04 8.19 8.23 (.06) (.13) (.19)
12/31/1999 17.14 - 1.92 1.92 - (1.70) (1.70)
Growth Fund
Class 1
11/30/1995 31.94 .33 10.63 10.96 (.29) (.80) (1.09)
11/30/1996 41.81 .24 5.17 5.41 (.29) (3.40) (3.69)
11/30/1997 43.53 .27 9.61 9.88 (.27) (3.02) (3.29)
11/30/1998 50.12 .19 10.91 11.10 (.17) (6.14) (6.31)
11/30/1999 54.91 .11 25.35 25.46 (.14) (8.11) (8.25)
12/31/1999 72.12 .01 9.64 9.65 (.05) (11.10) (11.15)
Class 2 (5)
11/30/1997 40.59 .11 9.51 9.62 (.12) - (.12)
11/30/1998 50.09 .08 10.90 10.98 (.05) (6.14) (6.19)
11/30/1999 54.88 (.02) 25.33 25.31 (.04) (8.11) (8.15)
12/31/1999 72.04 - 9.63 9.63 - (11.10) (11.10)
International Fund
Class 1
11/30/1995 13.27 .34 1.02 1.36 (.33) (.41) (.74)
11/30/1996 13.89 .28 1.96 2.24 (.31) (.29) (.60)
11/30/1997 15.53 .25 1.18 1.43 (.27) (.62) (.89)
11/30/1998 16.07 .22 2.21 2.43 (.28) (1.65) (1.93)
11/30/1999 16.57 .25 8.87 9.12 (.30) (.31) (.61)
12/31/1999 25.08 .01 4.34 4.35 (.10) (2.59) (2.69)
Class 2 (5)
11/30/1997 15.86 .13 .23 .36 (.16) - (.16)
11/30/1998 16.06 .20 2.19 2.39 (.24) (1.65) (1.89)
11/30/1999 16.56 .10 8.98 9.08 (.26) (.31) (.57)
12/31/1999 25.07 .01 4.33 4.34 (.09) (2.59) (2.68)
New World Fund (6)
Class 1
11/30/1999 10.00 .07 .51 .58 (.02) - (.02)
12/31/1999 10.56 .01 1.25 1.26 (.04) (.01) (.05)
Class 2
11/30/1999 10.00 .06 .51 .57 (.02) - (.02)
12/31/1999 10.55 .02 1.25 1.27 (.04) (.01) (.05)
Growth Income Fund
Class 1
11/30/1995 25.30 .73 7.20 7.93 (.73) (1.03) (1.76)
11/30/1996 31.47 .71 5.55 6.26 (.74) (1.26) (2.00)
11/30/1997 35.73 .73 6.78 7.51 (.72) (2.55) (3.27)
11/30/1998 39.97 .67 4.60 5.27 (.68) (3.83) (4.51)
11/30/1999 40.73 .69 3.94 4.63 (.66) (6.00) (6.66)
12/31/1999 38.70 .06 .88 .94 (.18) (6.38) (6.56)
Class 2 (5)
11/30/1997 34.10 .37 5.82 6.19 (.35) - (.35)
11/30/1998 39.94 .58 4.60 5.18 (.59) (3.83) (4.42)
11/30/1999 40.70 .59 3.94 4.53 (.56) (6.00) (6.56)
12/31/1999 38.67 .07 .87 .94 (.16) (6.38) (6.54)
Asset Allocation Fund
Class 1
11/30/1995 11.25 .50 2.69 3.19 (.50) (.17) (.67)
11/30/1996 13.77 .53 1.89 2.42 (.53) (.48) (1.01)
11/30/1997 15.18 .55 1.94 2.49 (.54) (.97) (1.51)
11/30/1998 16.16 .58 1.27 1.85 (.57) (.87) (1.44)
11/30/1999 16.57 .58 .60 1.18 (.57) (1.15) (1.72)
12/31/1999 16.03 .05 .15 .20 (.14) (1.02) (1.16)
Class 2 (5)
11/30/1997 14.43 .29 1.69 1.98 (.26) - (.26)
11/30/1998 16.15 .53 1.28 1.81 (.53) (.87) (1.40)
11/30/1999 16.56 .53 .61 1.14 (.53) (1.15) (1.68)
12/31/1999 16.02 .05 .14 .19 (.13) (1.02) (1.15)
Bond Fund (7)
Class 1
11/30/1996 $10.00 $.40 $.16 $.56 $(.25) - $(.25)
11/30/1997 10.31 .63 .30 .93 (.62) - (.62)
11/30/1998 10.62 .67 (.15) .52 (.65) $(.12) (.77)
11/30/1999 10.37 .73 (.50) .23 (.69) (.05) (.74)
12/31/1999 9.86 .07 (.01) .06 (.18) - (.18)
Class 2 (5)
11/30/1997 10.11 .35 .46 .81 (.31) - (.31)
11/30/1998 10.61 .65 (.15) .50 (.63) (.12) (.75)
11/30/1999 10.36 .67 (.47) .20 (.66) (.05) (.71)
12/31/1999 9.85 .06 - .06 (.17) - (.17)
High-Yield Bond Fund
Class 1
11/30/1995 $ 12.8 $ 1.32 $1.10 $2.42 $(1.32) - $(1.32)
11/30/1996 13.99 1.28 .54 1.82 (1.30) - (1.30)
11/30/1997 14.51 1.29 .43 1.72 (1.27) - (1.27)
11/30/1998 14.96 1.26 (1.04) .22 (1.25) (.16) (1.41)
11/30/1999 13.77 1.26 (.72) .54 (1.31) (.19) (1.50)
12/31/1999 12.81 .11 .12 .23 (.29) - (.29)
Class 2 (5)
11/30/1997 14.28 .69 .61 1.30 (.63) - (.63)
11/30/1998 14.95 1.25 (1.06) .19 (1.22) (.16) (1.38)
11/30/1999 13.76 1.18 (.67) .51 (1.28) (.19) (1.47)
12/31/1999 12.80 .11 .12 .23 (.28) - (.28)
U.S. Government/AAA-Rated
Securities Fund
Class 1
11/30/1995 $ 10.8 $ 0.82 $.71 $1.53 $(.81) - $(.81)
11/30/1996 11.52 .83 (.24) .59 (.82) - (.82)
11/30/1997 11.29 .76 (.07) .69 (.80) - (.80)
11/30/1998 11.18 .68 .26 .94 (.69) - (.69)
11/30/1999 11.43 .69 (.67) .02 (.67) - (.67)
12/31/1999 10.78 .06 (.10) (.04) (.18) - (.18)
Class 2 (5)
11/30/1997 10.83 .38 .33 .71 (.37) - (.37)
11/30/1998 11.17 .68 .24 .92 (.67) - (.67)
11/30/1999 11.42 .65 (.64) .01 (.65) - (.65)
12/31/1999 10.78 .05 (.10) (.05) (.17) - (.17)
Cash Management Fund
Class 1
11/30/1995 11.09 .63 (.02) .61 (.59) - (.59)
11/30/1996 11.11 .54 .01 .55 (.54) - (.54)
11/30/1997 11.12 .57 (.01) .56 (.55) - (.55)
11/30/1998 11.13 .57 (.01) .56 (.56) - (.56)
11/30/1999 11.13 .49 .02 .51 (.51) - (.51)
12/31/1999 11.13 .05 - .05 (.13) - (.13)
Class 2 (5)
11/30/1997 11.07 .28 .03 .31 (.26) - (.26)
11/30/1998 11.12 .55 (.02) .53 (.53) - (.53)
11/30/1999 11.12 .48 - .48 (.48) - (.48)
12/31/1999 11.12 .05 - .05 (.13) - (.13)
Net asset Net assetRatio of
value, end of expenses
Year end of Total year (in to average
Ended (1) year return millions)net assets
--------- ----------------- ------------------
Global Growth Fund (2)
Class 1
11/30/1997 $10.62 6.45 % (3) $ 80 .44 % (3)
11/30/1998 13.02 24.26 132 .75
11/30/1999 18.99 51.89 272 .72
12/31/1999 21.42 18.53 (3) 327 .06 (3)
Class 2
11/30/1997 10.61 6.28 (3) 46 .57 (3)
11/30/1998 13.02 24.06 124 1.00
11/30/1999 18.98 51.45 316 .96
12/31/1999 21.41 18.47 (3) 399 .08 (3)
Global Small
Capitalization Fund (4)
Class 1
11/30/1998 $ 9.11 (8.31) % (3) $55 .51 % (3)
11/30/1999 17.16 92.15 150 .82
12/31/1999 17.37 11.70 (3) 178 .07 (3)
Class 2
11/30/1998 9.10 (8.49) (3) 17 .64 (3)
11/30/1999 17.14 91.86 88 1.06
12/31/1999 17.36 11.69 (3) 111 .09 (3)
Growth Fund
Class 1
11/30/1995 41.81 35.35 3,154 .47
11/30/1996 43.53 14.32 3,860 .44
11/30/1997 50.12 24.57 4,671 .42
11/30/1998 54.91 25.27 5,313 .41
11/30/1999 72.12 52.55 7,270 .39
12/31/1999 70.62 14.45 (3) 8,224 .03 (3)
Class 2 (5)
11/30/1997 50.09 23.73 (3) 75 .37 (3)
11/30/1998 54.88 24.97 310 .66
11/30/1999 72.04 52.22 937 .64
12/31/1999 70.57 14.44 (3) 1,149 .05 (3)
International Fund
Class 1
11/30/1995 13.89 10.78 1,703 .75
11/30/1996 15.53 16.66 2,370 .69
11/30/1997 16.07 9.52 2,612 .67
11/30/1998 16.57 16.94 2,593 .66
11/30/1999 25.08 56.48 3,526 .61
12/31/1999 26.74 18.18 (3) 4,113 .05 (3)
Class 2 (5)
11/30/1997 16.06 2.20 (3) 48 .53 (3)
11/30/1998 16.56 16.63 126 .91
11/30/1999 25.07 56.16 311 .85
12/31/1999 26.73 18.16 (3) 391 .07 (3)
New World Fund (6)
Class 1
11/30/1999 10.56 5.87 (3) 37 .43 (3)
12/31/1999 11.77 11.88 (3) 45 .08 (3)
Class 2
11/30/1999 10.55 5.71 (3) 28 .57 (3)
12/31/1999 11.77 11.87 (3) 38 .10 (3)
Growth Income Fund
Class 1
11/30/1995 31.47 33.14 3,953 .44
11/30/1996 35.73 21.02 5,249 .41
11/30/1997 39.97 22.92 6,430 .38
11/30/1998 40.73 14.77 6,704 .36
11/30/1999 38.70 12.86 6,537 .35
12/31/1999 33.08 3.21 (3) 6,632 .03 (3)
Class 2 (5)
11/30/1997 39.94 18.18 (3) 157 .35 (3)
11/30/1998 40.70 14.49 564 .61
11/30/1999 38.67 12.59 1,109 .60
12/31/1999 33.07 3.19 (3) 1,203 .05 (3)
Asset Allocation Fund
Class 1
11/30/1995 13.77 29.45 870 .52
11/30/1996 15.18 18.65 1,141 .49
11/30/1997 16.16 17.90 1,393 .47
11/30/1998 16.57 12.32 1,497 .45
11/30/1999 16.03 7.65 1,394 .44
12/31/1999 15.07 1.45 (3) 1,387 .04 (3)
Class 2 (5)
11/30/1997 16.15 13.80 (3) 42 .40 (3)
11/30/1998 16.5 12.05 173 .70
11/30/1999 16.02 7.39 321 .69
12/31/1999 15.06 1.42 (3) 341 .06 (3)
Bond Fund (7)
Class 1
11/30/1996 $10.31 5.74 % (3) $ 77 .52 % (3)
11/30/1997 10.62 9.36 132 .55
11/30/1998 10.37 5.12 186 .54
11/30/1999 9.86 2.33 173 .53
12/31/1999 9.74 .59 (3) 169 .05 (3)
Class 2 (5)
11/30/1997 10.61 8.09 (3) 12 .44 (3)
11/30/1998 10.36 4.85 45 .78
11/30/1999 9.85 2.07 80 .78
12/31/1999 9.74 .59 (3) 85 .07 (3)
High-Yield Bond Fund
Class 1
11/30/1995 $13.99 19.81 % $ 534 .54 %
11/30/1996 14.51 13.75 662 .53
11/30/1997 14.96 12.45 (3) 765 .51
11/30/1998 13.77 1.44 715 .51
11/30/1999 12.81 4.22 589 .51
12/31/1999 12.75 1.83 (3) 586 .04 (3)
Class 2 (5)
11/30/1997 14.95 9.20 (3) 21 .43 (3)
11/30/1998 13.76 1.18 68 .76
11/30/1999 12.80 3.96 95 .76
12/31/1999 12.75 1.81 (3) 99 .07 (3)
U.S. Government/AAA-Rated
Securities Fund
Class 1
11/30/1995 $11.52 14.73 % $ 542 .54 %
11/30/1996 11.29 5.49 512 .53
11/30/1997 11.18 6.49 471 .52
11/30/1998 11.43 8.72 537 .51
11/30/1999 10.78 .24 431 .52
12/31/1999 10.56 (.41) (3) 421 .05 (3)
Class 2 (5)
11/30/1997 11.17 6.65 (3) 7 .44 (3)
11/30/1998 11.42 8.46 32 .75
11/30/1999 10.78 .08 47 .77
12/31/1999 10.56 (.43) (3) 48 .07 (3)
Cash Management Fund
Class 1
11/30/1995 11.11 5.65 193 .49
11/30/1996 11.12 5.09 240 .47
11/30/1997 11.13 5.21 226 .47
11/30/1998 11.13 5.17 250 .46
11/30/1999 11.13 4.73 306 .46
12/31/1999 11.05 .46 (3) 317 .04 (3)
Class 2 (5)
11/30/1997 11.1 2.87 (3) 14 .41 (3)
11/30/1998 11.1 4.92 34 .70
11/30/1999 11.12 4.47 48 .71
12/31/1999 11.04 .43 (3) 48 .06 (3)
Ratio
of net
income to Portfolio
Year average turnover
Ended (1) net assets rate
--------- --------- ---------
Global Growth Fund (2)
Class 1
11/30/1997 .80 % (3) 13.22 % (3)
11/30/1998 1.14 25.56
11/30/1999 1.01 25.84
12/31/1999 .06 (3) 2.65 (3)
Class 2
11/30/1997 .56 (3) 13.22 (3)
11/30/1998 .87 25.56
11/30/1999 .77 25.84
12/31/1999 .04 (3) 2.65 (3)
Global Small
Capitalization Fund (4)
Class 1
11/30/1998 .86 % (3) 28.20 % (3)
11/30/1999 .53 80.55
12/31/1999 - (3) 6.65 (3)
Class 2
11/30/1998 .63 (3) 28.20 (3)
11/30/1999 .25 80.55
12/31/1999 - (3) 6.65 (3)
Growth Fund
Class 1
11/30/1995 .92 35.47
11/30/1996 .61 30.88
11/30/1997 .59 45.14
11/30/1998 .38 49.91
11/30/1999 .19 36.81
12/31/1999 .01 (3) 2.55 (3)
Class 2 (5)
11/30/1997 .08 (3) 45.14
11/30/1998 .15 49.91
11/30/1999 - 36.81
12/31/1999 - (3) 2.55 (3)
International Fund
Class 1
11/30/1995 2.64 24.66
11/30/1996 1.99 32.08
11/30/1997 1.56 50.12
11/30/1998 1.36 34.08
11/30/1999 1.18 41.99
12/31/1999 .03 (3) 1.45 (3)
Class 2 (5)
11/30/1997 .34 (3) 50.12
11/30/1998 1.03 34.08
11/30/1999 .84 41.99
12/31/1999 .01 (3) 1.45 (3)
New World Fund (6)
Class 1
11/30/1999 1.02 (3) .81 (3)
12/31/1999 .18 (3) 2.57 (3)
Class 2
11/30/1999 .95 (3) .81 (3)
12/31/1999 .16 (3) 2.57 (3)
Growth Income Fund
Class 1
11/30/1995 2.70 26.91
11/30/1996 2.26 31.27
11/30/1997 2.01 37.55
11/30/1998 1.74 42.72
11/30/1999 1.75 40.63
12/31/1999 .18 (3) 2.69 (3)
Class 2 (5)
11/30/1997 .93 (3) 37.55
11/30/1998 1.02 42.72
11/30/1999 1.50 40.63
12/31/1999 .16 (3) 2.69 (3)
Asset Allocation Fund
Class 1
11/30/1995 4.11 39.89
11/30/1996 3.88 50.62
11/30/1997 3.63 34.14
11/30/1998 3.63 27.97
11/30/1999 3.50 36.27
12/31/1999 .31 (3) 1.42 (3)
Class 2 (5)
11/30/1997 1.81 (3) 34.14
11/30/1998 3.39 27.97
11/30/1999 3.24 36.27
12/31/1999 .29 (3) 1.42 (3)
Bond Fund (7)
Class 1
11/30/1996 6.18 % (3) 32.83 % (3)
11/30/1997 6.63 52.93
11/30/1998 6.89 61.54
11/30/1999 7.17 38.22
12/31/1999 .65 (3) 5.48 (3)
Class 2 (5)
11/30/1997 3.50 (3) 52.93
11/30/1998 6.62 61.54
11/30/1999 6.94 38.22
12/31/1999 .63 (3) 5.48 (3)
High-Yield Bond Fund
Class 1
11/30/1995 10.12 % 31.73 %
11/30/1996 9.27 44.81
11/30/1997 8.92 50.22
11/30/1998 8.66 65.80
11/30/1999 9.13 30.72
12/31/1999 .79 (3) 1.36 (3)
Class 2 (5)
11/30/1997 4.92 (3) 50.22
11/30/1998 8.60 65.80
11/30/1999 8.86 30.72
12/31/1999 .77 (3) 1.36 (3)
U.S. Government/AAA-Rated
Securities Fund
Class 1
11/30/1995 7.37 % 30.11 %
11/30/1996 7.33 30.45
11/30/1997 6.73 53.80
11/30/1998 6.11 89.25
11/30/1999 6.06 58.30
12/31/1999 .52 (3) 1.86 (3)
Class 2 (5)
11/30/1997 3.45 (3) 53.80
11/30/1998 5.68 89.25
11/30/1999 5.83 58.30
12/31/1999 .51 (3) 1.86 (3)
Cash Management Fund
Class 1
11/30/1995 5.37 -
11/30/1996 4.94 -
11/30/1997 4.99 -
11/30/1998 5.07 -
11/30/1999 4.65 -
12/31/1999 .45 (3) -
Class 2 (5)
11/30/1997 2.80 (3) -
11/30/1998 4.75 -
11/30/1999 4.40 -
12/31/1999 .42 (3) -
1 For the fiscal years ended November 30, 1995 through 1999 and the One month ended
December 31,1999
2 Commenced operations April 30, 1997
3 Based on operations for the period shown and, accordingly, not representative of a
full year.
4 Commenced operations April 30, 1998.
5 Shares offered for sale commencing April 30, 1997.
6 Commenced operations June 17, 1999
7 Commenced operations January 2, 1996
See Notes to Financial Statements
</TABLE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees and Shareholders of
American Variable Insurance Series:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investment portfolios, and the related statements of
operations and of changes in net assets and the per-share data and ratios
present fairly, in all material respects, the financial position of the Global
Growth Fund, the Global Small Capitalization Fund, the Growth Fund, the
International Fund, the New World Fund, the Growth-Income Fund, the Asset
Allocation Fund, the Bond Fund, the High-Yield Bond Fund, the U.S.
Government/AAA-Rated Securities Fund and the Cash Management Fund (constituting
the American Variable Insurance Series, hereafter referred to as the "Series")
at December 31, 1999 and at November 30, 1999, the results of each of their
operations, the changes in each of their net assets, and the per-share data and
ratios for each of the periods indicated, in conformity with accounting
principles generally accepted in the United States. These financial statements
and per-share data and ratios (hereafter referred to as "financial statements")
are the responsibility of the Series' 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 perform the audits 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 presentation. We believe that our audits, which included
confirmation of securities owned at December 31, 1999 and at November 30, 1999
by correspondence with the custodian, provide a reasonable basis for the
opinion expressed above.
PRICEWATERHOUSECOOPERS LLP
Los Angeles, California
January 18, 2000
