<PAGE> 1
1995
[ZWEIG SERIES TRUST LOGO]
ANNUAL REPORT
<PAGE> 2
CONTENTS
<TABLE>
<S> <C>
SHAREHOLDER LETTER 1
WHY WE OFFER ZWEIG MUTUAL FUNDS
THROUGH FINANCIAL ADVISORS 3
INVESTMENT PERFORMANCE VS.
INVESTOR PERFORMANCE: A CAUTIONARY NOTE 4
ZWEIG STRATEGY FUND REVIEW 6
ZWEIG MANAGED ASSETS REVIEW 8
ZWEIG APPRECIATION FUND REVIEW 10
GOVERNMENT SECURITIES REVIEW 12
ZWEIG CASH FUND REVIEW 13
STANDARDIZED PERFORMANCE 13
REPORT OF INDEPENDENT ACCOUNTANTS 14
STATEMENT OF NET ASSETS 15
STATEMENT OF OPERATIONS 33
STATEMENT OF CHANGES IN NET ASSETS 34
NOTES TO FINANCIAL STATEMENTS 36
FINANCIAL HIGHLIGHTS 40
</TABLE>
This report has been prepared for the information of shareholders of Zweig
Series Trust and is not authorized for distribution to prospective investors
unless preceded or accompanied by an effective prospectus that includes
information regarding the Trust's expenses, objectives, policies, management,
performance and other information.
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
<PAGE> 3
DEAR FELLOW SHAREHOLDER
Each of the Zweig Mutual Funds earned significant gains in 1995, helping to
bring our shareholders closer to achieving their long-term financial goals. I
am proud of our funds' performance, especially as it reflects the continuing
flexibility with which we manage your money.
As even the most casual market observer knows, 1995 turned out to be a year for
the record books. After a mild sinking spell in 1994, stocks climbed to new
heights in 1995, with hardly a pause or a stumble. The Dow Jones Industrial
Average had its best year since 1975; the S&P 500 made its strongest showing
since 1958 -- outperforming no less than 91% of all equity mutual funds. After
a genuinely horrific '94, bonds turned in their second best performance since
1925.
It's hard to believe that at the beginning of 1995, the Federal Reserve had
raised interest rates six times, and would tighten again in February in an
effort to cool down what appeared to be an overheated economy. We had entered
1995 with the market exposure of our stock funds at a highly defensive 30% of
assets. Rising interest rates, the threat of inflation and a roaring economy
have historically been bearish for bonds and stocks, and we had stayed largely
out of harm's way throughout 1994.
<TABLE>
<CAPTION>
1995 RETURNS AVERAGE MARKET AVG.
through 12/31/95 EXPOSURE DURATION
<S> <C> <C> <C>
ZWEIG STRATEGY FUND 25.1% 63%
A SHARES
ZWEIG APPRECIATION FUND 24.0% 65%
A SHARES
ZWEIG MANAGED ASSETS 16.3% 71%
A SHARES
GOVERNMENT SECURITIES 13.8% 4.1 Years
A SHARES
</TABLE>
But, late in the first quarter, the economy weakened markedly. As the pressure
came off interest rates and inflation, bonds rallied and stocks followed. Our
indicators reacted to these changes, and by the end of the quarter our equity
exposure had risen to 50%.
Our research continued to keep us in gear with the markets. As conditions
improved, we steadily increased the market exposure of our stock funds to 70%
at mid-year, 75% by the end of the third quarter, and 80% by year-end.
The positive monetary outlook was fueled by two Federal Reserve interest rate
cuts, one in July and one in December. In addition, a reduction in stock supply
coupled with greater demand bolstered the bullish case. Several significant
mergers and large corporate buybacks took large amounts of stock out of
circulation. At the same time, the strong demand for mutual funds kept money
flooding into the markets. Portfolio managers were
1
<PAGE> 4
forced to chase a shrinking supply of stock as they sought to invest the
inflows, helping drive prices higher.
Our funds participated solidly in the gains of 1995 because we followed the
dictates of our research and remained flexible. As market conditions changed,
so did our research, and so did our market exposure. This is what you hire us
to do. You won't find us prognosticating about the future. We believe that no
one can consistently predict what stocks and bonds will do next. We react to
changes in the markets by adjusting the asset mix of our funds.
[PHOTO OF MARTIN E. ZWEIG, Ph.D., President]
Our goal is the same as that of every other mutual fund -- superior long-term
returns. The path we take, however, is quite different. Most mutual funds make
little attempt to limit losses. They are designed to capture all the gains of a
bull market, but often suffer the sharp declines of a bear market.
Our style is designed to participate solidly during bull markets, which all of
our funds have been doing over the past several years, and to protect the bulk
of our gains during serious market declines -- which haven't occurred since
1990. We are pleased to be doing as well as we are during these bull phases,
yet we remain focused on risk control as the key to successful investing over
the long run.
In the midst of all the bullish news, it's important to remember that the
markets have gone more than five years without even a 10% correction in stocks
- -- the longest such run ever. My 34 years in the market have taught me that the
markets are cyclical. No matter how long a particular phase lasts, the markets
always return to their historical pattern of growth, punctuated by periodic and
often painful declines. Though our research currently favors the bullish case,
we are always prepared to retreat to cash as our indicators reflect changing
conditions and rising risk.
I am the chief strategist for our funds, responsible for the asset mix
decisions. Our portfolio managers pick the stocks and bonds for our funds. They
discuss the results of each fund later in this report. Thank you for your
continued confidence in us.
Sincerely,
/s/ MARTIN E. ZWEIG
- ----------------------
MARTIN E. ZWEIG, PH.D.
President
January 17, 1996
2
<PAGE> 5
WHY WE OFFER ZWEIG MUTUAL FUNDS
THROUGH FINANCIAL ADVISORS
The goal of Zweig Mutual Funds is to produce superior risk-adjusted rates of
return over complete market cycles. And we believe that most investors need
someone to explain to them the vitally important concept of risk-adjusted rates
of return.
Simply stated, that's why we offer our funds through financial advisors.
Any prospective investor can look up the past performance of mutual funds in a
magazine. Returns, in that sense, are very easy to understand.
On the other hand, it is more difficult to get an accurate, objective idea of
the risk taken on in order to get those returns.
This is really too bad, since most people's investment behavior isn't driven by
how much they can make, but by how much they can lose. At Zweig, we believe
that far more people would have a greater appreciation of the importance of
risk management...if only someone would explain it to them.
That's where a trained, professional financial advisor comes in.
If one looks at two mutual funds in a magazine, both of which have an average
return of 10% per year over a certain period of time, it will be easy to assume
that both funds have performed equally well.
But when a financial advisor points out that one fund was 95% invested during
the period and experienced marked volatility, while the other was only 65%
invested and declined much less during a bear market, suddenly the superior
risk-adjusted return of the latter fund becomes clear.
This is certainly not to suggest that individual investors are incapable of
determining risk-adjusted rates of return on their own, if they look hard
enough. It's just that, late in a major bull market, too few people may be
trying to measure risk at all. (In fact, 63 months into the longest bull-market
run of the century, getting your arms around risk is probably harder than it's
ever been.)
In our experience, the superior financial advisor is always mindful of risk.
That's why we offer our funds through financial advisors. And why many superior
financial advisors recommend Zweig Mutual Funds to their clients.
3
<PAGE> 6
INVESTMENT PERFORMANCE VS. INVESTOR PERFORMANCE:
A CAUTIONARY NOTE
As this greatest of bull markets continues to age, "superior performance" has
become the goal of a whole new generation of equity mutual fund investors.
Indeed, most investors view performance as total return, without accounting for
the risk taken to achieve that return.
Unfortunately, there is an imperfect correlation between the performance of
mutual funds and the behavior of mutual fund investors.
First of all, investors tend to put hugely disproportionate sums into mutual
funds after a tremendous market rise. For example, the last 20% decline in
equity prices -- the textbook definition of a "bear market" -- ended on October
11, 1990. In the first six full calendar months of the current bull market
(November 1990 through April 1991), net investment in equity mutual funds was
$11 billion. In the last six months of 1995, with the broad market averages
roughly 87% higher than they were in the November '90-April '91 period, net
equity fund inflows were $110 billion.*
Thus, relative performance figures tend to mask the fact that a great many
people "buy high." Still, we know that even investors who buy at relatively
high levels may do satisfactorily in the long run -- if they hold on for the
long run. The trouble is, they often don't.
Having bought mutual funds only after a huge runup in prices, many investors
have shown a marked tendency to redeem fund shares late in the next major
market decline, or on their way to getting back to even. Bluntly put, after
having bought high, many people sell low.
BY CHASING PEAK "PERFORMANCE," INVESTORS MAY BE SETTING THEMSELVES UP FOR
FAR-ABOVE-AVERAGE DECLINES IN THE NEXT CYCLICAL DOWNTURN.
As always, there is a theory in the land today that "this time it's different;"
that today's new breed of fund investors will not succumb to the urge to bail
out of investments when they experience a major cyclical downturn. Recent
evidence, however, suggests that nothing much has changed, and that investor
behavior in major downdrafts is no less prone to panic than ever.
*Source: Ned Davis Research, Investment Company Institute.
4
<PAGE> 7
INVESTOR REACTION TO A BEAR MARKET: BOND MUTUAL FUND SALES
<TABLE>
<CAPTION>
Month Year Flows Shearson
- -------------------------------------------------------
<S> <C> <C> <C>
Jan-90 1990 0.22 3,332.27
Feb-90 1990 1.46 3,314.08
Mar-90 1990 1.33 3,308.57
Apr-90 1990 0.59 3,230.80
May-90 1990 2.74 3,374.03
Jun-90 1990 1.96 3,451.90
Jul-90 1990 2.34 3,487.29
Aug-90 1990 -1.41 3,343.02
Sep-90 1990 0.58 3,377.76
Oct-90 1990 0.61 3,454.40
Nov-90 1990 1.52 3,600.26
Dec-90 1990 0.88 3,669.02
Jan-91 1991 3.40 3,717.26
Feb-91 1991 2.69 3,724.95
Mar-91 1991 3.53 3,739.74
Apr-91 1991 5.30 3,791.75
May-91 1991 4.40 3,786.98
Jun-91 1991 4.16 3,760.91
Jul-91 1991 6.58 3,820.49
Aug-91 1991 6.76 3,948.35
Sep-91 1991 7.43 4,075.87
Oct-91 1991 7.35 4,081.71
Nov-91 1991 5.73 4,103.97
Dec-91 1991 5.02 4,351.88
Jan-92 1992 7.71 4,212.00
Feb-92 1992 7.43 4,238.14
Mar-92 1992 6.78 4,193.41
Apr-92 1992 6.71 4,198.90
May-92 1992 8.68 4,301.92
Jun-92 1992 8.67 4,368.90
Jul-92 1992 10.31 4,549.19
Aug-92 1992 7.71 4,580.67
Sep-92 1992 9.75 4,651.88
Oct-92 1992 3.06 4,553.94
Nov-92 1992 8.10 4,570.16
Dec-92 1992 6.08 4,698.94
Jan-93 1993 9.85 4,836.06
Feb-93 1993 9.89 4,996.12
Mar-93 1993 7.34 5,005.59
Apr-93 1993 8.00 5,054.86
May-93 1993 8.23 5,039.82
Jun-93 1993 9.23 5,279.52
Jul-93 1993 9.60 5,368.84
Aug-93 1993 9.01 5,582.67
Sep-93 1993 4.23 5,605.98
Oct-93 1993 7.27 5,640.18
Nov-93 1993 2.34 5,487.48
Dec-93 1993 3.97 5,512.63
Jan-94 1994 6.39 5,646.98
Feb-94 1994 -1.35 5,419.24
Mar-94 1994 -8.83 5,190.30
Apr-94 1994 -5.34 5,119.63
May-94 1994 -2.31 5,088.29
Jun-94 1994 -0.96 5,041.31
Jul-94 1994 -1.75 5,193.87
Aug-94 1994 -1.84 5,166.12
Sep-94 1994 -3.14 5,006.69
Oct-94 1994 -6.16 4,985.19
Nov-94 1994 -8.26 5,008.95
Dec-94 1994 -6.80 5,130.02
Jan-95 1995 -0.47 5,267.67
Feb-95 1995 3.17 5,419.46
Mar-95 1995 -1.55 5,454.07
Apr-95 1995 0.08 5,551.15
May-95 1995 2.45 5,989.77
Jun-95 1995 -1.45 6,053.29
Jul-95 1995 1.71 5,953.82
Aug-95 1995 1.96 6,080.80
Sep-95 1995 1.44 6,185.85
Oct-95 1995 2.81 6,367.46
Nov-95 1995 2.83 6,531.36
Dec-95 1995 6,706.15
</TABLE>
As the chart above shows, net inflows into bond funds soared to record levels
as interest rates plunged and bond prices surged between 1991 and the autumn of
1993. At that point, interest rates shot up again, and bond prices declined
sharply. This drove bond funds into massive net liquidation throughout 1994.
Bond prices then recovered to new highs in 1995--while bond funds were in net
redemptions (more money was exiting the funds than entering them).
The fact that the Lehman Brothers Treasury Bond Index started 1991 around 3700
and ended 1995 around 6700 makes yet another marvelous intellectual case for
"buy-and-hold." The volatility bonds went through in the interim -- and the
truly awful buy-high-sell-low cycle of investor behavior occasioned by that
volatility -- only reaffirms our conviction that our strategy of loss
limitation is as vitally important today as it ever was.
Late in a bull market, when performance mania seizes ever larger numbers of
people, investors tend to lose sight of the fact that peak "performance"
usually goes hand-in-hand with peak volatility. Thus, by chasing peak
"performance," investors may be setting themselves up for far-above-average
declines in the next cyclical downturn. And historically, peak volatility is
the one thing many investors are unable to go through without panic.
Our style of management seeks to participate solidly in the advancing phases of
the market, and then to retreat to the safety of cash during major market
declines. All the evidence continues to suggest that this strategy reduces the
potential psychological and financial pitfalls of investing, and thus increases
the chance that more people will be capable of holding on. Our ultimate goal,
then, is to help narrow the wide gap between investment performance and
investor performance.
5
<PAGE> 8
A RISK-AVERSE
APPROACH TO THE
GROWTH POTENTIAL
OF MID-SIZED AND
LARGE-COMPANY STOCKS
QUOTRON SYMBOLS:
ZSTAX / ZSTCX
ASSETS AS OF 12/31/95:
$ 1.1 BILLION
PORTFOLIO MANAGER:
[PHOTO OF DAVID KATZEN]
DAVID KATZEN
ZWEIG STRATEGY FUND
Zweig Strategy Fund solidly participated in the stock market gains of 1995. The
Class A and Class C Shares were up 25.1% and 24.3%, respectively. We achieved
our returns while taking considerably less risk than the average fund. Our
average cash position during the year was 37%. I'm particularly pleased with
our long-term performance. From its inception on December 29, 1989, through
December 31, 1995, the Fund has returned an average of 11.2% annually, versus
12.2% for the average growth fund. We have captured 92% of the upside during
the bull market while holding an average of 34% of our assets in the safety of
cash.
As Marty Zweig discusses in his letter, 1995 demonstrated the value of
our flexible and pragmatic approach. While our willingness to gradually retreat
to the safety of cash is what sets us apart from most other funds, and helped
us during market declines in 1990 and 1994, 1995 was a year in which risk
takers earned the greatest rewards. Although we came into 1995 cautiously, our
research steadily improved and we became more heavily invested along the way,
once again vindicating our flexible style.
The Fund's unique style was also evident in 1995 through our stock
selection. The quantitative model that drives our stock selection process was
constructed to focus on stocks with above-average earnings growth and
below-average valuations. During the first nine months of the year, this
process directed us to be overweighted in technology and banking stocks, two of
the top-performing sectors. This in large part helped us keep pace with the
market, despite our heavy cash position. Importantly, we remained true to our
discipline of emphasizing both growth and valuations in our equity holdings. So
while the fourth quarter saw a sharp rotation away from technology stocks, the
favorable value characteristics of our portfolio (low price-to-earnings ratio,
low price-to-book-value ratio) cushioned our results. Still, we lagged the S&P
500 during this period.
As we begin the new year, our exposure represents a moderately
optimistic posture. Our equity focus has moved toward more cyclical areas such
as the chemicals, metal and mining, and machinery stocks. Utilities and
airlines also are improving in our model. These industries currently have the
best combination of growth trends and favorable valuations in our mid- to
large-cap universe.
Please see page 13 for additional performance information.
/s/ DAVID KATZEN
- ---------------------
DAVID KATZEN
Senior Vice President
January 17, 1996
6
<PAGE> 9
ZWEIG STRATEGY FUND HAS CAPTURED 92% OF THE GAINS OF THE AVERAGE
GROWTH FUND DURING THE LONGEST BULL MARKET THIS CENTURY,
AND HAS DONE SO WITH AN AVERAGE MARKET EXPOSURE OF 66%.
PERFORMANCE for the year ended 12/31/95
<TABLE>
<S> <C>
ZWEIG STRATEGY FUND
A SHARES 25.1%
C SHARES 24.3%
LIPPER GROWTH FUND AVERAGE 30.8%
S&P 500 37.5%
AVERAGE MARKET EXPOSURE: 63%
</TABLE>
<TABLE>
<CAPTION>
Annualized since inception
AVERAGE MARKET
EXPOSURE
<S> <C> <C>
ZWEIG STRATEGY FUND (A SHARES) 11.2% 66%
LIPPER GROWTH FUND AVERAGE 12.2%+
S&P 500 INDEX 13.1%
- ---------------------------------------------------------------------------------------------
ZWEIG STRATEGY FUND (C SHARES) 11.1% 63%
INCEPTION DATES: A SHARES-12/29/89
C SHARES-2/3/92
</TABLE>
<TABLE>
<CAPTION>
ASSET MIXES for 1995
<S> <C>
January 1
STOCKS 30%
CASH 70%
March 31
STOCKS 50%
CASH 50%
June 30
STOCKS 70%
CASH 30%
December 31
STOCKS 80%
CASH 20%
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECTORS as of 12/31/95*
<S> <C>
PROCESS INDUSTRIES 20.1%
ELECTRONIC TECHNOLOGY 19.9%
FINANCE 15.9%
NON-ENERGY MINERALS 9.8%
UTILITIES 9.1%
PRODUCER MANUFACTURING 8.5%
TRANSPORTATION 6.6%
ENERGY MINERALS 3.8%
CONSUMER DURABLES 2.2%
CONSUMER NON-DURABLES 1.5%
</TABLE>
+ The Lipper Growth Fund Average is based on the total return of 572 growth
funds. The period measured is from 12/31/89 due to Lipper's weekly data.
Returns do not include any initial or contingent deferred sales charges.
For purposes of determining asset mix, the Fund's stock futures position
is treated as reducing or increasing stock exposure and increasing or
reducing cash.
* Percentage of the stock portion of the Fund only; does not take into
account the Fund's cash position.
7
<PAGE> 10
FLEXIBLE ASSET
ALLOCATION AMONG
DOMESTIC AND
INTERNATIONAL STOCKS,
BONDS AND CASH
QUOTRON SYMBOLS:
ZMAAX / ZMACX
ASSETS AS OF 12/31/95:
$ 669 MILLION
PORTFOLIO MANAGER:
[PHOTO OF CARLTON B. NEEL]
CARLTON B. NEEL
ZWEIG MANAGED ASSETS
Zweig Managed Assets participated solidly in the gains of foreign and domestic
stocks and bonds during 1995. Foreign stock markets were laggards in 1995,
however, U.S. stocks and bonds posted banner years, which helped propel the
Fund to returns of 16.3% and 15.4% for the Class A and Class C Shares,
respectively. Zweig Managed Assets captured nearly 95% of the 17.4% return of
the Lipper Global Flexible Fund Average.
It is important when examining the Fund's performance to keep in mind
ZMA's significant international exposure. In September, we increased the Fund's
allowable foreign exposure to 50%, and increased the potential equity exposure
to 60%. We made these changes in order to increase the Fund's flexibility and
take advantage of additional investment oppor-tunities. In addition, we have
increased the Fund's diversification by expanding the number of countries we
invest in.
Throughout 1995, central banks in Europe responded to weaker economic
conditions by lowering key short-term interest rates. Expectations of
continued central bank measures, combined with low inflation, helped bond
markets across Europe rally to new highs late in 1995. After declining more
than 25% in the first six months of 1995, Japanese stocks recovered, ending
December above where they had begun the year. We concentrated our investments
in Japanese bonds as interest rates fell during the early part of the year, and
then moved into Japanese stocks as the market rallied.
Lower interest rates are usually followed by stronger stock markets,
as was the case in the U.S. in 1995. Thus, with rates currently falling
throughout Europe, our outlook there is positive. If the rally in Japanese
stocks continues, we are prepared to increase our investment there. We've
expanded into Hong Kong, and are moving into Singapore, as well.
In the fourth quarter, our new investment parameters helped the Fund
to a return of 3.5% for the A Shares and 3.2% for the C Shares, while the
Lipper Global Flexible Fund Average was up 3.0%. We will continue to adhere to
our flexible investment philosophy, seeking to participate solidly in bull
markets globally as they occur, while limiting risk during bear phases through
the use of cash and diversification.
Please see page 13 for additional performance information.
/s/ CARLTON B. NEEL
- --------------------
CARLTON B. NEEL
First Vice President
January 17, 1996
8
<PAGE> 11
ZWEIG MANAGED ASSETS HAS CAPTURED 83% OF THE RETURNS OF THE
AVERAGE GLOBAL FLEXIBLE FUND SINCE ITS INCEPTION, AND HAS DONE
SO WITH AN AVERAGE MARKET EXPOSURE OF 62%.
<TABLE>
<CAPTION>
PERFORMANCE for the year ended 12/31/95
<S> <C>
ZWEIG MANAGED ASSETS
A SHARES 16.3%
C SHARES 15.4%
LIPPER GLOBAL FLEXIBLE AVERAGE 17.4%
AVERAGE EXPOSURE: STOCKS 31%, BONDS 40%, CASH 29%
</TABLE>
<TABLE>
<S> <C>
Annualized since inception
ZWEIG MANAGED ASSETS (A SHARES) 8.4%
ZWEIG MANAGED ASSETS (C SHARES) 7.7%
LIPPER GLOBAL FLEXIBLE FUND AVG. 10.1%+
</TABLE>
<TABLE>
<CAPTION>
AVERAGE MARKET EXPOSURE
<S> <C>
STOCKS 27%
BONDS 35%
CASH 38%
</TABLE>
<TABLE>
<CAPTION>
ASSET MIXES for 1995
<S> <C>
January 1
CASH 55%
BONDS 34%
STOCKS 11%
March 31
CASH 44%
BONDS 35%
STOCKS 21%
June 30
CASH 37%
BONDS 32%
STOCKS 31%
December 31
CASH 10%
BONDS 46%
STOCKS 44%
</TABLE>
[MAP]
<TABLE>
<CAPTION>
COUNTRY ALLOCATIONS as of 12/31/95
Cash
Stocks Bonds Equivalents
<S> <C> <C> <C>
U.S. 20.1% 20.0% 8.3%
AUSTRALIA 3.5 2.9 0.0
CANADA 1.9 1.2 0.0
FINLAND 0.0 2.0 0.0
FRANCE 2.4 4.3 0.0
GERMANY 3.5 4.5 0.0
HONG KONG 1.0 0.0 0.0
ITALY 0.0 1.1 0.0
JAPAN 4.2 0.0 0.0
NEW ZEALAND 0.4 2.2 1.3
SPAIN 3.1 1.8 0.0
SWEDEN 0.0 2.2 0.0
SWITZERLAND 1.0 0.0 0.0
UNITED KINGDOM 3.1 4.0 0.0
TOTAL 44.2% 46.2% 9.6%
</TABLE>
Countries ZMA is invested in.
+ The Lipper Global Flexible Fund Average is based on the total return of 55
global flexible funds. The period measured is from 2/11/93 due to Lipper's
weekly data. Returns do not include any initial or contingent deferred
sales charges.
For purposes of determining asset mix, the Fund's stock futures position
is treated as reducing or increasing stock exposure and increasing or
reducing cash.
9
<PAGE> 12
A RISK-AVERSE
APPROACH TO THE
GROWTH POTENTIAL OF
SMALL-COMPANY STOCKS
QUOTRON SYMBOLS:
ZAPAX / ZAPCX
ASSETS AS OF 12/31/95:
$ 468 MILLION
PORTFOLIO MANAGER:
[PHOTO OF DAVID KATZEN]
DAVID KATZEN
ZWEIG APPRECIATION FUND
Zweig Appreciation Fund Class A and C Shares were up 24.0% and 23.2%,
respectively, in 1995. These returns surpassed the 21.8% earned by the Value
Line Geometric Index. The average small-company stock fund, meanwhile, was up
31.5%.
We've delivered on our goal of generating attractive returns during
this unusually kind phase in the market. Nevertheless, some investors may ask
why they should be satisfied being up 24.0% while the average small-company
stock fund is up 31.5%. The reason is that we also delivered on our goal of
controlling risk. Our average cash position during the year was 35%. Thus, we
captured 75% of the gains of our peers, with a market exposure of only 65% --
a superior risk-adjusted return. Beyond holding cash, we also kept risk low
through prudent industry diversification. For example, we participated in the
gains of the technology sector in 1995, as did many of our competitors.
However, the amount of the Fund that was invested in this group never exceeded
20%. Thus, when many small-company funds suffered in the fourth quarter from
technology's reversal, we were somewhat insulated by our more conservative
position.
It is important to remember that throughout the entire existence of
the Fund, we've been in a bull market environment. While we've been pleased
with our performance, we know that it only tells half the story. When it comes
to evaluating mutual fund managers, it is important to know what their game
plan is for the inevitable periods of corrections and bear markets. Successful
long-term investors know that the best offense is often a good defense.
Morningstar, an independent monitor of mutual funds, notes that as of
12/31/95, Appreciation Fund's risk was in the lowest 2% of its peer group. The
Fund's risk control is evidenced in a number of ways, from its much broader
diversification among stocks and sectors, to the substantially lower
price-to-earnings ratios of its stocks. Most of the other small-company stock
funds are making bigger bets on companies' earnings with less regard for the
price paid to capture that growth. While the biggest risk takers have looked
best over the past few years, I'm confident that the value of our approach,
already seen in our risk-adjusted returns, will be more widely appreciated
during the next cyclical downturn in small-company stocks.
Please see page 13 for additional performance information.
/s/ DAVID KATZEN
- ---------------------
DAVID KATZEN
Senior Vice President
January 17, 1996
10
<PAGE> 13
ZWEIG APPRECIATION FUND HAS EARNED 73% OF THE GAINS OF ITS PEERS SINCE
ITS INCEPTION, AND HAS DONE SO WITH AN AVERAGE MARKET EXPOSURE OF 65%.
<TABLE>
<CAPTION>
PERFORMANCE for the year ended 12/31/95
<S> <C>
ZWEIG APPRECIATION FUND
A SHARES 24.0%
C SHARES 23.2%
LIPPER SMALL-COMPANY FUND AVERAGE 31.5%+
VALUE LINE GEOMETRIC INDEX 21.8%
AVERAGE MARKET EXPOSURE: 65%
</TABLE>
<TABLE>
<CAPTION>
Annualized since inception
AVERAGE MARKET
EXPOSURE
<S> <C> <C>
ZWEIG APPRECIATION FUND (A SHARES) 12.1% 65%
LIPPER SMALL-CO. FUND AVERAGE 16.6%+
VALUE LINE GEOMETRIC INDEX 9.3%
- ----------------------------------------------------------------------------------------------------
ZWEIG APPRECIATION FUND (C SHARES) 9.8% 64%
INCEPTION DATES: A SHARES-10/8/91
C SHARES-2/3/92
</TABLE>
<TABLE>
<CAPTION>
ASSET MIXES for 1995
<S> <C>
January 1
STOCKS 30%
CASH 70%
March 31
STOCKS 50%
CASH 50%
June 30
STOCKS 70%
CASH 30%
December 31
STOCKS 80%
CASH 20%
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECTORS as of 12/31/95*
<S> <C>
FINANCE 24.9%
ELECTRONIC TECHNOLOGY 13.0%
PRODUCER MANUFACTURING 11.7%
PROCESS INDUSTRIES 11.3%
UTILITIES 9.1%
NON-ENERGY MINERALS 8.2%
TRANSPORTATION 4.4%
CONSUMER DURABLES 4.1%
CONSUMER NON-DURABLES 2.5%
COMMERCIAL SERVICES 2.2%
</TABLE>
+ The Lipper Small-Company Fund Average is based on the total return of
305 small-company funds. The period measured is from 10/10/91 due to
Lipper's weekly data. Returns do not include any initial or contingent
deferred sales charges.
The Value Line Geometric Index measures the returns of 1,700 stocks
ranging from large-cap to small-cap on an unweighted basis. The
returns include an estimate for dividends reinvested.
For purposes of determining asset mix, the Fund's stock futures
position is treated as reducing or increasing stock exposure and
increasing or reducing cash.
* Percentage of the stock portion of the Fund only; does not take into
account the Fund's cash position.
11
<PAGE> 14
MONTHLY INCOME
FROM U.S. GOVERNMENT
SECURITIES
QUOTRON SYMBOLS:
ZGVAX / ZGVCX
ASSETS AS OF 12/31/95:
$ 62 MILLION
PORTFOLIO MANAGER:
[PHOTO OF CARLTON B. NEEL]
CARLTON B. NEEL
GOVERNMENT SECURITIES
What a difference a year makes! In stark contrast to a dismal 1994, 1995 was a
banner year for bonds. In 1994, the Lehman Brothers Government Bond Index fell
3.4%, its worst annual performance in over a decade. But 1995 more than made up
for it, as the Index rallied 18.3% for the year.
Weaker-than-expected economic conditions fueled the strong bond
market. Toward the end of 1994, the economy appeared overheated, and most
economists expected the Federal Reserve to continue to raise interest rates.
However, as the economy started to show signs of slowing, bonds began to rally
in early 1995. The rally continued throughout the spring, and in the summer the
Fed surprised many by easing interest rates. This paved the way for continued
bond market strength and a final Fed rate cut in December.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE ONE SINCE
THROUGH 12/31/95 YEAR INCEPTION
<S> <C> <C>
GOVERNMENT SECURITIES (A SHARES) 13.8% 7.9%
LIPPER U.S. GOV'T. FUND AVERAGE 17.3% 8.9%+
- ---------------------------------------------------------------------------------------------
GOVERNMENT SECURITIES (C SHARES) 13.3% 6.4%
INCEPTION DATES: A SHARES - 3/25/85*; C SHARES - 2/3/92
</TABLE>
In keeping with our risk-averse approach to investing, we tend to
maintain a lower average maturity and duration than our peers. Duration is a
measure of a fund's price sensitivity to changes in interest rates. The higher
the duration of a fund, the more the fund will make (or lose) as rates fall (or
rise). The Fund's duration in early 1995 was somewhat lower than economic
conditions warranted. Our models are based heavily on Federal Reserve policy
and interest rate levels. Since the Fed had tightened six times in 1994, and
was still tightening in early 1995, we elected to maintain a low exposure to
interest rate fluctuations. How-ever, the economy cooled rapidly, and bonds
began to rally to new highs. Beginning in the second quarter, we gradually
increased the Fund's duration to 5.4 years, where it remained at year-end.
Government Securities captured nearly 80% of the gains of the average
government bond fund last year, with an average duration for 1995 of 4.1 years,
which was lower than that of the average fund. The Class A Shares returned
13.8% for the year and the C Shares returned 13.3%, compared with 17.3% for the
Lipper U.S. Government Fund Average. For the fourth quarter, the A and C Shares
returned 5.0% and 4.9%, respectively, versus 4.4% for the average government
bond fund.
Please see page 13 for additional performance information.
/s/ CARLTON B. NEEL
- ---------------------
CARLTON B. NEEL
First Vice President
January 17, 1996
+ The Lipper U.S. Government Fund Average is based on the total return of
174 government bond funds. The period measured is from 3/31/85 due to
Lipper's weekly data. Returns do not include any initial or contingent
deferred sales charges.
* Zweig/Glaser Advisers assumed responsibility for managing the Fund on
September 1, 1989.
12
<PAGE> 15
ZWEIG CASH FUND
The annualized net yield of Zweig Cash Fund for the year ended December 31,
1995, was 5.08% for Class A and C Shares, and 5.32% for Class M Shares.
STANDARDIZED PERFORMANCE
Average annual returns through 12/31/95 net of all charges and expenses
ZWEIG STRATEGY FUND
<TABLE>
<CAPTION>
CLASS A SHARES (ZSTAX) CLASS C SHARES (ZSTCX)
from inception from inception
(12/29/89) five year one year (2/3/92) one year
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
10.2% 12.8% 18.2% 11.1% 22.7%
............................................................................................................
</TABLE>
ZWEIG MANAGED ASSETS
<TABLE>
<CAPTION>
CLASS A SHARES (ZMAAX) CLASS C SHARES (ZMACX)
from inception from inception
(2/8/93) one year (2/8/93) one year
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
6.3% 9.9% 7.7% 14.0%
............................................................................................................
</TABLE>
ZWEIG APPRECIATION FUND
<TABLE>
<CAPTION>
CLASS A SHARES (ZAPAX) CLASS C SHARES (ZAPCX)
from inception from inception
(10/8/91) one year (2/3/92) one year
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
10.6% 17.2% 9.8% 21.7%
............................................................................................................
</TABLE>
GOVERNMENT SECURITIES
<TABLE>
<CAPTION>
CLASS A SHARES (ZGVAX) CLASS C SHARES (ZGVCX)
from inception
10 year five year one year (2/3/92) one year
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
6.5% 6.8% 8.4% 6.4% 11.9%
</TABLE>
Class A Share returns reported above include the effect of the 5.5% maximum
initial sales charge (4.75% for Government Securities). Class C Shares, sold
with no initial sales charge, are subject to a 1.25% contingent deferred sales
charge if sold within 12 months of purchase. Class C Share one-year returns
reported above assume that a redemption took place. Returns assume that all
dividends and capital gains are reinvested. Aggregate annual service and
distribution fees are .30% for Class A Shares and 1.0% for Class C Shares (.75%
for Government Securities).
13
<PAGE> 16
REPORT OF INDEPENDENT ACCOUNTANTS
THE SHAREHOLDERS AND BOARD OF TRUSTEES OF ZWEIG SERIES TRUST:
We have audited the accompanying statements of net assets of Zweig Series Trust
(comprising the Zweig Strategy Fund, Zweig Appreciation Fund, Zweig Managed
Assets, Government Securities Series and Zweig Cash Fund) as of December 31,
1995 and the related statements of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period
then ended and financial highlights for each of the five years in the period
then ended with respect to Zweig Strategy Fund, Zweig Appreciation Fund,
Government Securities Series and Zweig Cash Fund; and each of the three years
in the period then ended with respect to Zweig Managed Assets. These financial
statements and financial highlights are the responsibility of the management of
the Trust. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1995 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the Series constituting Zweig Series Trust as of December 31, 1995, the
results of their operations for the year then ended, the changes in their net
assets for each of the two years in the period then ended, and financial
highlights for each of the periods referred to above, in conformity with
generally accepted accounting principles.
Coopers & Lybrand L.L.P.
New York, New York
January 22, 1996
14
<PAGE> 17
ZWEIG STRATEGY FUND
Statement of Net Assets as of December 31, 1995
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ---------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS: 75.82%
AEROSPACE: 2.06%
Aviall Inc. . . . . . . . . . . . . . . . . . 25,695 $ 240,891
McDonnell Douglas Corp. . . . . . . . . . . . 184,900 17,010,800
Northrop Grumman Corp. . . . . . . . . . . . 78,800 5,043,200
United Technologies Corp. . . . . . . . . . . 900 85,387
--------------
22,380,278
--------------
AIR FREIGHT: 0.45%
* Federal Express Corp. . . . . . . . . . . . . 65,700 4,853,588
AIRLINES: 3.35%
* AMR Corp. . . . . . . . . . . . . . . . . . . 47,000 3,489,750
British Airways Plc., ADR . . . . . . . . . . 8,200 596,550
Delta Air Lines Inc. . . . . . . . . . . . . 209,400 15,469,425
* Northwest Airlines Corp. . . . . . . . . . . 68,500 3,493,500
* UAL Corp. . . . . . . . . . . . . . . . . . . 75,100 13,405,350
--------------
36,454,575
--------------
AUTOMOBILES: 1.06%
General Motors Corp. . . . . . . . . . . . . 219,000 11,579,625
--------------
AUTOMOTIVE PARTS AND EQUIPMENT: 0.22%
Dana Corp. . . . . . . . . . . . . . . . . . 55,800 1,632,150
TRW Inc. . . . . . . . . . . . . . . . . . . 10,100 782,750
--------------
2,414,900
--------------
BANKS: 8.80%
Bank of Boston Corp. . . . . . . . . . . . . 225,500 10,429,375
Bank of New York Inc. . . . . . . . . . . . . 222,800 10,861,500
BankAmerica Corp. . . . . . . . . . . . . . . 64,500 4,176,375
* Bay Ridge Bancorp Inc. . . . . . . . . . . . 209,100 4,613,269
BayBanks Inc. . . . . . . . . . . . . . . . . 30,000 2,947,500
* Brooklyn Bancorp Inc. . . . . . . . . . . . . 27,200 1,108,400
Chemical Banking Corp. . . . . . . . . . . . 195,500 11,485,625
Citicorp . . . . . . . . . . . . . . . . . . 198,800 13,369,300
Comerica Inc. . . . . . . . . . . . . . . . . 21,100 846,638
Crestar Financial Corp. . . . . . . . . . . . 12,400 733,150
First American Corp., Tennessee . . . . . . . 27,500 1,302,812
First Bank Systems Inc. . . . . . . . . . . . 14,800 734,450
First Chicago Corp. . . . . . . . . . . . . . 92,650 3,659,675
First Interstate Bancorp . . . . . . . . . . 90,600 12,366,900
Hibernia Corp., Class A . . . . . . . . . . . 147,600 1,586,700
NationsBank Corp. . . . . . . . . . . . . . . 20,400 1,420,350
PNC Bank Corp. . . . . . . . . . . . . . . . 266,910 8,607,847
* Riggs National Corp., Washington . . . . . . 58,300 757,900
UJB Financial Corp. . . . . . . . . . . . . . 1,300 46,475
Union Bank of San Francisco . . . . . . . . . 36,600 1,985,550
U.S. Bancorp . . . . . . . . . . . . . . . . 14,847 499,230
Wells Fargo & Co. . . . . . . . . . . . . . . 10,400 2,246,400
--------------
95,785,421
--------------
BUILDING MATERIALS AND PRODUCTS: 0.97%
Johnson Controls Inc. . . . . . . . . . . . . 5,900 405,625
Lafarge Corp. . . . . . . . . . . . . . . . . 9,200 172,500
* Owens Corning Fiberglass Corp. . . . . . . . 50,300 2,257,212
* Southdown Inc. . . . . . . . . . . . . . . . 9,200 179,400
* Toll Brothers Inc. . . . . . . . . . . . . . 62,400 1,435,200
* USG Corp. . . . . . . . . . . . . . . . . . . 95,400 2,862,000
* Waban Inc. . . . . . . . . . . . . . . . . . 170,400 3,195,000
--------------
10,506,937
--------------
CASINO OPERATORS: 0.25%
Grand Casinos Inc. . . . . . . . . . . . . . 117,000 2,720,250
--------------
CATALOG DISTRIBUTION: 0.26%
Premark International Inc. . . . . . . . . . 55,000 2,784,375
--------------
CHEMICALS: 7.22%
Akzo Nobel N.V., ADS . . . . . . . . . . . . 5,800 336,400
Cabot Corp. . . . . . . . . . . . . . . . . . 54,200 2,920,025
* Cytec Industries Inc. . . . . . . . . . . . . 24,700 1,540,663
Dow Chemical Corp. . . . . . . . . . . . . . 134,300 9,451,363
Dupont (E.I.) De Nemours & Co. . . . . . . . 11,600 810,550
Eastman Chemical Co. . . . . . . . . . . . . 256,200 16,044,525
First Mississippi Corp. . . . . . . . . . . . 91,300 2,419,450
Georgia Gulf Corp. . . . . . . . . . . . . . 66,000 2,029,500
Goodrich B.F.Co. . . . . . . . . . . . . . . 2,600 177,125
IMC Global Inc. . . . . . . . . . . . . . . . 350,500 14,326,687
Imperial Chemical Industries Plc, ADR . . . . 55,500 2,594,625
Mississippi Chemical Corp. . . . . . . . . . 47,800 1,111,350
Olin Corp. . . . . . . . . . . . . . . . . . 124,000 9,207,000
Terra Industries Inc. . . . . . . . . . . . . 114,500 1,617,312
Union Carbide Corp. . . . . . . . . . . . . . 374,200 14,032,500
--------------
78,619,075
--------------
COMPUTER COMPONENTS AND SOFTWARE: 5.34%
* Computervision Corp. . . . . . . . . . . . . 179,075 2,753,278
* Cypress Semiconductor Corp. . . . . . . . . . 104,200 1,328,550
* In Focus Systems Inc. . . . . . . . . . . . . 7,000 252,875
* Integrated Device Technology Inc. . . . . . . 264,100 3,400,287
Micron Technology Inc. . . . . . . . . . . . 219,000 8,677,875
* Microsemi Corp. . . . . . . . . . . . . . . . 71,500 616,687
* National Semiconductor Corp. . . . . . . . . 570,300 12,689,175
* Seagate Technology Corp. . . . . . . . . . . 367,700 17,465,750
Texas Instruments Inc. . . . . . . . . . . . 160,400 8,300,700
* VLSI Technology Inc. . . . . . . . . . . . . 147,400 2,671,625
--------------
58,156,802
--------------
CONGLOMERATES: 1.58%
BET Plc, ADS . . . . . . . . . . . . . . . . 1,400 10,675
ITT Corp. . . . . . . . . . . . . . . . . . . 7,300 386,900
Loews Corp. . . . . . . . . . . . . . . . . . 148,800 11,662,200
Norsk Hydro A.S., ADS . . . . . . . . . . . . 68,800 2,881,000
Textron Inc. . . . . . . . . . . . . . . . . 33,200 2,241,000
--------------
17,181,775
--------------
CONSTRUCTION EQUIPMENT: 1.30%
AGCO Corp. . . . . . . . . . . . . . . . . . 21,600 1,101,600
Case Corp. . . . . . . . . . . . . . . . . . 256,300 11,725,725
JLG Industries Inc. . . . . . . . . . . . . . 25,000 743,750
* Varity Corp. . . . . . . . . . . . . . . . . 14,200 527,175
--------------
14,098,250
--------------
CONTAINERS AND PACKAGING: 1.26%
Federal Paper Board Co., Inc. . . . . . . . . 142,500 7,392,188
Temple Inland Inc. . . . . . . . . . . . . . 144,000 6,354,000
--------------
13,746,188
--------------
DATA PROCESSING SYSTEMS: 3.89%
* Compaq Computer Corp. . . . . . . . . . . . . 12,400 595,200
* Dell Computer Corp. . . . . . . . . . . . . . 251,100 8,694,338
* Digital Equipment Corp. . . . . . . . . . . . 105,600 6,771,600
International Business Machines Corp. . . . . 165,500 15,184,625
* Sun Microsystems Inc. . . . . . . . . . . . . 243,200 11,096,000
--------------
42,341,763
--------------
ELECTRICAL PRODUCTS: 1.46%
Philips Electronics N.V. . . . . . . . . . . 444,400 15,942,850
--------------
ELECTRONICS: 4.29%
* Advanced Semiconductors Corp. . . . . . . . . 22,900 1,127,825
Avnet Inc. . . . . . . . . . . . . . . . . . 23,800 1,065,050
Burr Brown Corp. . . . . . . . . . . . . . . 57,400 1,463,700
Credence Systems Corp. . . . . . . . . . . . 12,800 292,800
* Electro Scientific Industries Inc. . . . . . 22,400 655,200
* Electroglas Inc. . . . . . . . . . . . . . . 63,200 1,548,400
* Hadco Corp. . . . . . . . . . . . . . . . . . 67,200 1,890,000
Harris Corp. . . . . . . . . . . . . . . . . 73,300 4,004,013
* Hutchinson Technology Inc. . . . . . . . . . 99,900 4,220,775
Innovex Inc. . . . . . . . . . . . . . . . . 64,100 977,525
* Komag Inc. . . . . . . . . . . . . . . . . . 151,200 6,974,100
* Kulicke & Soffa Industries Inc. . . . . . . . 222,000 5,161,500
Loral Corp. . . . . . . . . . . . . . . . . . 39,800 1,407,925
* Read-Rite Corp. . . . . . . . . . . . . . . . 267,100 6,210,075
* SCI Systems Inc. . . . . . . . . . . . . . . 115,300 3,574,300
* Silicon Valley Group Inc. . . . . . . . . . . 17,400 439,350
</TABLE>
15
<PAGE> 18
ZWEIG STRATEGY FUND
Statement of Net Assets as of December 31, 1995
(Continued)
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ---------------------------------------------------------------------------------------------
<S> <C> <C>
ELECTRONICS (CONTINUED)
Teledyne Inc. . . . . . . . . . . . . . . . . 63,500 $ 1,627,188
* Teradyne Inc. . . . . . . . . . . . . . . . . 90,300 2,257,500
Varian Associates Inc. . . . . . . . . . . . 6,900 329,475
Wyle Electronics Inc. . . . . . . . . . . . . 42,530 1,493,866
--------------
46,720,567
--------------
FARMING AND MILLING: 0.77%
Archer-Daniels-Midland Co. . . . . . . . . . 463,635 8,345,430
--------------
FINANCE: 0.15%
Dean Witter, Discover & Co. . . . . . . . . . 21,500 1,010,500
Finova Group Inc. . . . . . . . . . . . . . . 4,500 217,125
First Financial Caribbean Corp. . . . . . . . 3,000 56,250
Travelers Group Inc. . . . . . . . . . . . . 6,400 402,400
--------------
1,686,275
--------------
FOOD AND BEVERAGES: 1.10%
Chiquita Brands International Inc. . . . . . 114,020 1,567,775
IBP Inc. . . . . . . . . . . . . . . . . . . 205,400 10,372,700
--------------
11,940,475
--------------
FOREST AND PAPER PRODUCTS: 9.46%
Abitibi Price Inc. . . . . . . . . . . . . . 126,225 1,830,263
Boise Cascade Corp. . . . . . . . . . . . . . 217,500 7,530,938
Bowater Inc. . . . . . . . . . . . . . . . . 265,200 9,414,600
Champion International Corp. . . . . . . . . 242,500 10,185,000
Chesapeake Corp. . . . . . . . . . . . . . . 36,400 1,078,350
Consolidated Papers Inc. . . . . . . . . . . 40,665 2,282,323
Georgia-Pacific Corp. . . . . . . . . . . . . 217,400 14,919,075
International Paper Co. . . . . . . . . . . . 60,000 2,272,500
James River Corp. . . . . . . . . . . . . . . 60,000 1,447,500
Mead Corp. . . . . . . . . . . . . . . . . . 145,100 7,581,475
* Mercer International Inc. . . . . . . . . . . 115,200 2,361,600
Potlatch Corp. . . . . . . . . . . . . . . . 67,915 2,716,600
Rayonier Inc. . . . . . . . . . . . . . . . . 54,775 1,828,116
Union Camp Corp. . . . . . . . . . . . . . . 225,000 10,715,625
Westvaco Corp. . . . . . . . . . . . . . . . 190,700 5,291,925
Weyerhaeuser Co. . . . . . . . . . . . . . . 307,200 13,286,400
Willamette Industries Inc. . . . . . . . . . 146,400 8,235,000
--------------
102,977,290
--------------
HEALTHCARE FACILITIES AND PRODUCTS: 0.61%
Community Psychiatric Centers Corp. . . . . . 33,500 410,375
ICN Pharmaceuticals Inc. . . . . . . . . . . 112,580 2,167,165
* Integrated Health Services Inc. . . . . . . . 13,400 335,000
* OrNda Healthcorp. . . . . . . . . . . . . . . 159,000 3,696,750
--------------
6,609,290
--------------
HOUSEHOLD PRODUCTS: 0.42%
Black & Decker Corp. . . . . . . . . . . . . 128,800 4,540,200
--------------
INDUSTRIAL PRODUCTS: 0.39%
Harnischfeger Industries Inc. . . . . . . . . 16,000 532,000
Kennametal Inc. . . . . . . . . . . . . . . . 41,600 1,320,800
Parker-Hannifin Corp. . . . . . . . . . . . . 39,900 1,366,575
Tecumseh Products Co., Class A . . . . . . . 11,400 589,950
TRINOVA Corp. . . . . . . . . . . . . . . . . 16,600 475,175
--------------
4,284,500
--------------
INSURANCE: 1.24%
AFLAC Inc. . . . . . . . . . . . . . . . . . 12,400 537,850
AMBAC Inc. . . . . . . . . . . . . . . . . . 5,500 257,813
EXEL Limited . . . . . . . . . . . . . . . . 69,400 4,233,400
Old Republic International Corp. . . . . . . 1,500 53,250
PartnerRe Holdings Ltd. . . . . . . . . . . . 50,700 1,394,250
Reliastar Financial Corp. . . . . . . . . . . 5,000 221,875
St. Paul Companies Inc. . . . . . . . . . . . 64,000 3,560,000
TIG Holdings Inc. . . . . . . . . . . . . . . 67,700 1,929,450
USF&G Corp. . . . . . . . . . . . . . . . . . 73,400 1,238,625
Western National Corp. . . . . . . . . . . . 6,600 106,425
--------------
13,532,938
--------------
INVESTMENT BANKING AND BROKERAGE: 0.72%
Alex Brown Inc. . . . . . . . . . . . . . . . 50,460 2,119,320
Lehman Brothers Holdings Inc. . . . . . . . . 221,000 4,696,250
Quick & Reilly Group Inc. . . . . . . . . . . 51,405 1,053,802
--------------
7,869,372
--------------
MARINE TRANSPORTATION: 0.07%
Stolt-Nielsen S.A. . . . . . . . . . . . . . 28,000 808,500
--------------
METAL FABRICATION: 0.39%
* Mueller Industries Inc. . . . . . . . . . . . 42,525 1,243,856
Timken Co. . . . . . . . . . . . . . . . . . 70,000 2,677,500
Trinity Industries Inc. . . . . . . . . . . . 10,000 315,000
--------------
4,236,356
--------------
METALS AND MINING: 3.26%
Alcan Aluminum Ltd. . . . . . . . . . . . . . 127,900 3,980,888
* Alumax Inc. . . . . . . . . . . . . . . . . . 124,600 3,815,875
Aluminum Company of America . . . . . . . . . 96,200 5,086,575
ASARCO Inc. . . . . . . . . . . . . . . . . . 114,300 3,657,600
* Kaiser Aluminum Corp. . . . . . . . . . . . . 227,300 2,954,900
* Magma Copper Co. . . . . . . . . . . . . . . 16,800 468,300
Phelps Dodge Corp. . . . . . . . . . . . . . 47,000 2,925,750
Reynolds Metals Co. . . . . . . . . . . . . . 223,000 12,627,375
--------------
35,517,263
--------------
OFFICE AUTOMATION AND EQUIPMENT: 0.16%
* Mentor Graphics Corp. . . . . . . . . . . . . 32,300 589,475
* Network Equipment Technologies Inc. . . . . . 42,300 1,157,962
--------------
1,747,437
--------------
OIL AND GAS: 3.44%
British Petroleum Plc., ADR . . . . . . . . . 38,275 3,908,834
Coastal Corp. . . . . . . . . . . . . . . . . 125,300 4,667,425
Mobil Corp. . . . . . . . . . . . . . . . . . 72,700 8,142,400
Occidental Petroleum Co. . . . . . . . . . . 526,600 11,256,075
Panhandle Eastern Corp. . . . . . . . . . . . 33,700 939,388
Repsol S.A., ADR . . . . . . . . . . . . . . 193,900 6,374,462
* Smith International Inc. . . . . . . . . . . 24,100 566,350
* Tesoro Petroleum Corp. . . . . . . . . . . . 35,500 306,188
YPF Sociedad Anonima, ADS . . . . . . . . . . 60,000 1,297,500
--------------
37,458,622
--------------
RAILROADS: 1.11%
Burlington Northern Santa Fe Corp. . . . . . 36,131 2,818,218
Conrail Inc. . . . . . . . . . . . . . . . . 98,400 6,888,000
CSX Corp. . . . . . . . . . . . . . . . . . . 52,600 2,399,875
--------------
12,106,093
--------------
REAL ESTATE INVESTMENT TRUSTS: 0.16%
CWM Mortgage Holdings Inc. . . . . . . . . . 105,200 1,788,400
--------------
RECREATIONAL PRODUCTS: 0.05%
Outboard Marine Corp. . . . . . . . . . . . . 27,080 551,755
--------------
RETAIL TRADE: 0.18%
* Autozone Inc. . . . . . . . . . . . . . . . . 1,400 40,425
* CompUSA Inc. . . . . . . . . . . . . . . . . 19,400 603,825
Ross Stores Inc. . . . . . . . . . . . . . . 51,900 992,587
* Safeway Inc. . . . . . . . . . . . . . . . . 7,000 360,500
--------------
1,997,337
--------------
SAVINGS & LOAN ASSOCIATIONS: 0.97%
Astoria Financial Corp. . . . . . . . . . . . 26,900 1,227,313
California Federal Bank Corp. . . . . . . . . 160,100 2,521,575
* Dime Bancorp Inc. . . . . . . . . . . . . . . 31,200 362,700
* Glendale Federal Bank Corp. . . . . . . . . . 165,000 2,887,500
GP Financial Corp. . . . . . . . . . . . . . 31,700 847,975
Long Island Bancorp Inc. . . . . . . . . . . 58,000 1,529,750
Standard Federal Bank Corp. . . . . . . . . . 28,800 1,134,000
--------------
10,510,813
--------------
</TABLE>
16
<PAGE> 19
<TABLE>
Number Value
of Shares (Note 2)
- ---------------------------------------------------------------------------------------------
<S> <C> <C>
STEEL: 0.89%
* AK Steel Holdings Corp. . . . . . . . . . . . 46,400 $ 1,589,200
British Steel Plc, ADS . . . . . . . . . . . 99,000 2,536,875
* LTV Corp. . . . . . . . . . . . . . . . . . . 218,300 3,001,625
Quanex Corp. . . . . . . . . . . . . . . . . 34,795 674,153
* Tubos De Acero de Mexico, ADR . . . . . . . . 40,625 284,375
USX-U.S. Steel Group . . . . . . . . . . . . 24,200 744,150
* WHX Corp. . . . . . . . . . . . . . . . . . . 74,700 812,362
--------------
9,642,740
--------------
TELECOMMUNICATIONS: 0.98%
Philippine Long Distance Telephone Co., ADS . 35,400 1,916,025
Telefonica de Espana, S.A., ADS . . . . . . . 207,800 8,701,625
--------------
10,617,650
--------------
TEXTILES: 0.13%
* Westpoint Stevens Inc. . . . . . . . . . . . 69,900 1,402,369
--------------
UTILITIES: 5.41%
Baltimore Gas & Electric Co. . . . . . . . . 14,200 404,700
Centerior Energy Corp. . . . . . . . . . . . 137,300 1,218,538
CMS Energy Corp. . . . . . . . . . . . . . . 38,600 1,153,175
* Columbia Gas Systems Inc. . . . . . . . . . . 84,800 3,720,600
DQE Inc. . . . . . . . . . . . . . . . . . . 30,200 928,650
Entergy Corp. . . . . . . . . . . . . . . . . 70,400 2,059,200
FPL Group Inc. . . . . . . . . . . . . . . . 18,400 853,300
General Public Utilities Inc. . . . . . . . . 136,700 4,647,800
Illinova Corp. . . . . . . . . . . . . . . . 170,900 5,127,000
New England Electric System Co. . . . . . . . 12,600 499,275
New York State Electric & Gas Co. . . . . . . 36,500 944,437
Northeast Utilities Corp. . . . . . . . . . . 165,100 4,024,312
Northern States Power Co. . . . . . . . . . . 21,700 1,066,013
Ohio Edison Co. . . . . . . . . . . . . . . . 8,900 209,150
Pacific Enterprises Inc. . . . . . . . . . . 31,500 889,875
Pacific Gas & Electric Co. . . . . . . . . . 231,700 6,574,487
Pinnacle West Capital Corp. . . . . . . . . . 186,100 5,350,375
Portland General Corp. . . . . . . . . . . . 7,000 203,875
Public Service Co. of Colorado . . . . . . . 10,200 360,825
SCE Corp. . . . . . . . . . . . . . . . . . . 509,100 9,036,525
Sierra Pacific Resources Inc. . . . . . . . . 13,800 322,575
Unicom Corp. . . . . . . . . . . . . . . . . 285,400 9,346,850
--------------
58,941,537
--------------
TOTAL COMMON STOCKS
(Cost $730,475,420) . . . . . . . . . . . 825,399,861
--------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
---------
<S> <C> <C>
SHORT-TERM OBLIGATIONS: 8.79%
FEDERAL FARM CREDIT BANK, DISCOUNT
NOTES: 1.37%:
5.65%, 1/4/96 . . . . . . . . . . . . . . . . $ 10,000,000 9,995,292
5.44%, 2/13/96 . . . . . . . . . . . . . . . 5,000,000 4,967,511
--------------
14,962,803
--------------
FEDERAL HOME LOAN MORTGAGE CORP.,
DISCOUNT NOTES: 4.58%:
5.47%, 1/16/96 . . . . . . . . . . . . . . . 10,000,000 9,977,208
5.56%, 1/16/96 . . . . . . . . . . . . . . . 15,000,000 14,965,250
5.46%, 1/17/96 . . . . . . . . . . . . . . . 10,000,000 9,975,733
5.65%, 1/22/96 . . . . . . . . . . . . . . . 10,000,000 9,967,042
5.54%, 2/14/96 . . . . . . . . . . . . . . . 5,000,000 4,966,144
--------------
49,851,377
--------------
FEDERAL NATIONAL MORTGAGE ASSN,
DISCOUNT NOTES: 2.29%:
5.48%, 1/5/96 . . . . . . . . . . . . . . . . 10,000,000 9,993,911
5.56%, 1/25/96 . . . . . . . . . . . . . . . 10,000,000 9,962,933
5.54%, 2/28/96 . . . . . . . . . . . . . . . 5,000,000 4,957,085
--------------
24,913,929
--------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
or Number Value
of Contracts (Note 2)
- --------------------------------------------------------------------------------------------
<S> <C> <C>
UNITED STATES TREASURY BILLS: 0.55%
5.285%, 1/4/96 . . . . . . . . . . . . . . . $1,000,000(a) $ 999,560
5.29%, 1/11/96 . . . . . . . . . . . . . . . 1,000,000(a) 998,531
5.24%, 1/18/96 . . . . . . . . . . . . . . . 1,000,000(a) 997,526
5.29%, 1/18/96 . . . . . . . . . . . . . . . 1,000,000(a) 997,502
5.21%, 3/14/96 . . . . . . . . . . . . . . . 2,000,000(a) 1,980,398
--------------
5,973,517
--------------
TOTAL SHORT-TERM OBLIGATIONS
(Cost $95,698,386) . . . . . . . . . . . . . 95,701,626
--------------
</TABLE>
<TABLE>
<S> <C> <C>
REPURCHASE AGREEMENTS: 17.42%
With Morgan Stanley & Co., Inc.
(dated 12/29/95), 5.95%, due 1/2/96
(Repurchase proceeds $89,725,279);
collateralized by: $86,938,097 various
United States Government Agency Obligations,
6.00%-10.75%, 12/1/2000-12/1/2025 (Market
value $91,845,036). . . . . . . . . . . . . . 89,666,000 89,666,000
With Prudential Securities Inc. (dated
12/29/95), 5.95%, due 1/2/96 (Repurchase
proceeds $100,066,111) collateralized by:
$98,993,212 various United States Government
Agency Obligations, 6.50%-8.50%,
2/15/2001-12/15/2025 (Market value
$102,000,077). . . . . . . . . . . . . . . . 100,000,000 100,000,000
--------------
TOTAL REPURCHASE AGREEMENTS
(Cost $189,666,000) . . . . . . . . . . . . . . . . . . . . . . . . . 189,666,000
--------------
NET UNREALIZED DEPRECIATION ON FUTURES
CONTRACTS: (0.05)%
Standard & Poor's 500
March 1996 Long futures (b) . . . . . . . . . 151 (573,237)
--------------
TOTAL INVESTMENTS
(Cost $1,015,839,806) . . . . . . . . . . . . 101.98% 1,110,194,250
Other Assets . . . . . . . . . . . . . . . . . . 3.17 34,450,197
------- ---------------
Total Assets . . . . . . . . . . . . . . . . 105.15% 1,144,644,447
Total Liabilities (Note 7) . . . . . . . . . (5.15) (56,058,516)
------- ---------------
NET ASSETS (Note 9) . . . . . . . . . . . . . . . 100.00% $1,088,585,931
======= ===============
CLASS A SHARES
Net asset value (NAV) and redemption price per share
($558,286,293/38,467,646 shares) . . . . . . . . . . . . . . . . . . . . $14.51
======
Maximum public offering price per share- NAV/(1-maximum
sales charge) ($14.51/.945) . . . . . . . . . . . . . . . . . . . . . . . $15.35
======
CLASS C SHARES
Net asset value and offering price per share
($530,299,638/36,430,336 shares) . . . . . . . . . . . . . . . . . . . . $14.56
======
Redemption price per share . . . . . . . . . . . . . . . . . . . . . . . **
======
- -------------------------------------------------------------------------------------------
</TABLE>
* Non-income producing security.
** Varies by length of time shares are held. (Note 3b)
(a) Pledged as collateral for futures transactions.
(b) The market value of the long futures was $46,692,975 (repesenting 4.29% of
the Fund's net assets) with a cost of $47,266,212. For Federal income tax
purposes, the tax basis of investments owned at December 31, 1995 was
$1,016,297,043 and unrealized appreciation on investments consisted of:
<TABLE>
<S> <C>
Gross unrealized appreciation . . . . . . . . . . . . . . . . . . $ 112,847,013
Gross unrealized depreciation . . . . . . . . . . . . . . . . . . (18,949,806)
-------------
Net unrealized appreciation . . . . . . . . . . . . . . . . . . . $ 93,897,207
=============
</TABLE>
See notes to financial statements.
17
<PAGE> 20
ZWEIG APPRECIATION FUND
Statement of Net Assets as of December 31, 1995
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS: 85.77%
ADVERTISING: 0.03%
* Heritage Media Corp., Class A . . . . . . . . . . . . . . . . . . . . . . . . . 5,100 $ 130,688
------------
AEROSPACE: 1.43%
Aviall Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71,700 672,188
McDonnell Douglas Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,900 2,750,800
* Moog Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,300 281,175
Northrop Grumman Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,800 563,200
* RMI Titanium Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68,400 547,200
* Sequa Corp., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,690 417,545
United Technologies Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,300 1,451,588
------------
6,683,696
------------
AIR FREIGHT: 0.36%
* Federal Express Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,700 1,676,962
------------
AIRLINES: 1.92%
* AMR Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,800 2,658,150
British Airways Plc., ADR . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,900 574,725
Delta Air Lines Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,300 2,681,662
KLM Royal Dutch Airlines . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,402 1,212,670
* Northwest Airlines Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,700 1,004,700
* UAL Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,800 678,300
* WorldCorp Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,900 169,000
------------
8,979,207
------------
APPAREL: 0.28%
* Quicksilver Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,900 1,329,894
------------
AUTOMOBILES: 1.08%
Chrysler Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,952 1,658,592
Ford Motor Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48,800 1,415,200
General Motors Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,700 1,781,888
Volvo Aktiebolaget, ADR., Class B . . . . . . . . . . . . . . . . . . . . . . . 10,400 214,174
------------
5,069,854
------------
AUTOMOTIVE PARTS AND EQUIPMENT: 0.89%
Barnes Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,000 468,000
Carlisle Companies Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,700 310,888
Dana Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,700 693,225
Goodyear Tire & Rubber Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,700 1,166,137
* ITT Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,800 355,200
* Lear Seating Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000 87,000
Standard Motor Products Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 2,400 36,000
Starrett L.S. Co., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,900 514,913
Wynns International Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,300 512,512
------------
4,143,875
------------
BANKS: 11.22%
Banco Latinoamericano de Export 'E'. . . . . . . . . . . . . . . . . . . . . . . 12,400 576,600
Bank of Boston Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56,500 2,613,125
Bank of New York Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54,900 2,676,375
BankAmerica Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,200 1,307,950
Banponce Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,600 1,185,750
Barnett Banks Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,300 2,141,700
* Bay Ridge Bancorp Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,200 379,475
BayBanks Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,900 1,660,425
* Brooklyn Bancorp Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,600 594,950
Centura Banks Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,600 864,075
Chase Manhattan Bank Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,800 957,875
Chemical Banking Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,300 2,191,375
Citicorp . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,800 2,542,050
City National Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,400 229,600
Comerica Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,800 1,356,225
Compass Bancshares Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,400 541,200
Crestar Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,100 1,129,287
Cullen Frost Bankers Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,400 620,000
CVB Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,810 208,876
Deposit Guaranty Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,400 1,441,800
First American Corp., Tennessee . . . . . . . . . . . . . . . . . . . . . . . . 30,300 1,435,462
First Bank Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,600 1,270,400
First Chicago Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,481 650,999
First Empire State Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,100 675,800
First Interstate Bancorp . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,600 2,675,400
First Union Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,300 1,351,688
Fleet Financial Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,000 1,141,000
Hibernia Corp., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130,100 1,398,575
Hubco Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,801 1,433,722
Mercantile Bancorporation Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 11,800 542,800
Metrobank Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,200 350,000
Mid-American Bancorp . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,926 358,668
National Australia Bank Ltd., ADR . . . . . . . . . . . . . . . . . . . . . . . 4,900 221,725
National Westminster Bank Plc, ADR . . . . . . . . . . . . . . . . . . . . . . . 8,500 516,375
NationsBank Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,300 717,137
North Fork Bancorp . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,756 1,635,089
PNC Bank Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,930 2,287,492
Republic New York Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,700 1,223,862
* Riggs National Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,000 442,000
* Santa Monica Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,080 207,350
Southern National Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,800 204,750
SouthTrust Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,325 982,078
Sterling Bancorp . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,730 271,625
SunTrust Banks Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,800 397,300
UJB Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,900 353,925
Union Bank of San Francisco . . . . . . . . . . . . . . . . . . . . . . . . . . 10,200 553,350
U.S. Bancorp . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,783 934,203
Wells Fargo & Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,500 1,188,000
Westamerica Bancorp . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,700 895,275
Westpac Banking Corp., ADR . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,700 173,250
Zions Bancorp . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,400 754,350
------------
52,462,363
------------
BUILDING MATERIALS AND PRODUCTS: 1.61%
Ameron Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,100 530,512
Armstrong World Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . 1,700 105,400
Florida Rock Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 15,100 441,675
International Aluminum Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,100 491,625
Johnson Controls Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,800 880,000
Lafarge Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,300 511,875
* Lamson & Sessions Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,900 502,975
* Lone Star Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,600 690,000
* Manville Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,000 196,875
Medusa Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,100 135,150
* Mestek Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,000 317,250
* Owens Corning Fiberglass Corp. . . . . . . . . . . . . . . . . . . . . . . . . . 4,300 192,962
Puerto Rican Cement Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,600 251,750
Republic Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,200 604,800
Shelter Components Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,987 867,662
* Southdown Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,300 337,350
* USG Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,100 453,000
* Waban Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,600 48,750
------------
7,559,611
------------
CASINO OPERATORS: 0.15%
* Casino America Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,500 168,438
Grand Casinos Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,350 519,638
------------
688,076
------------
CATALOG DISTRIBUTION: 0.26%
Premark International Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,300 1,230,187
------------
CHEMICALS: 3.52%
Aceto Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,450 343,200
AEP Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,849 656,678
Akzo Nobel N.V., ADS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,700 1,142,600
ARCO Chemical Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,665 1,053,461
Cabot Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,700 684,213
Cambrex Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,400 1,050,925
* Cytec Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,300 392,962
Dow Chemical Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,900 2,244,963
Eastman Chemical Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,400 2,342,175
* Electrochemical Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . 54,200 157,516
First Mississippi Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,800 498,200
Georgia Gulf Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,300 501,225
</TABLE>
18
<PAGE> 21
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CHEMICALS (CONTINUED)
IMC Global Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,700 $ 641,738
Imperial Chemical Industries Plc, ADR . . . . . . . . . . . . . . . . . . . . . 13,675 639,306
Mississippi Chemical Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,800 483,600
* Rexene Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,400 122,550
Terra Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56,900 803,712
Union Carbide Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,800 2,430,000
Wellman Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,700 288,925
------------
16,477,949
------------
COAL MINING: 0.10%
* Addington Resources Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,700 156,488
Ashland Coal Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,000 320,625
------------
477,113
------------
COMMERCIAL SERVICES: 0.63%
* ADT Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58,800 882,000
* C D I Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,300 347,400
M A R C Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,897 290,994
Volt Information Sciences Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 28,500 776,625
World Fuel Services Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,050 667,544
------------
2,964,563
------------
COMPUTER COMPONENTS AND SOFTWARE: 3.27%
* Computervision Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93,600 1,439,100
* Hogan Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56,900 775,263
* Integrated Circuit Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . 30,800 381,150
* Integrated Device Technology Inc. . . . . . . . . . . . . . . . . . . . . . . . 31,900 410,712
* International Rectifier Corp. . . . . . . . . . . . . . . . . . . . . . . . . . 12,400 310,000
Micron Technology Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48,400 1,917,850
* Microsemi Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45,300 390,712
* National Semiconductor Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 80,800 1,797,800
* Printronix Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,400 215,600
* Seagate Technology Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,600 2,451,000
* Siliconix Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,300 1,158,100
* Software Spectrum Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,400 352,600
* Supertex Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,400 222,025
Texas Instruments Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,400 2,194,200
* VLSI Technology Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,400 224,750
* Western Digital Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58,200 1,040,325
------------
15,281,187
------------
CONGLOMERATES: 1.77%
American Financial Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 3,500 107,188
BET Plc, ADS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,090 328,561
* Great American Management &
Investment Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,300 455,700
ITT Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,800 784,400
Loews Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,800 3,197,700
Montedison S.P.A., ADR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,100 299,650
Norsk Hydro A. S., ADS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,700 1,494,938
Nova Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47,200 377,600
Textron Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,200 1,228,500
------------
8,274,237
------------
CONSTRUCTION EQUIPMENT: 2.05%
AGCO Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,550 1,660,050
Cascade Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,700 513,800
Case Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,700 581,025
* Gardner Denver Machinery Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 34,700 659,300
JLG Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95,600 2,844,100
NACCO Industries Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . . 6,600 366,300
* Navistar International Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 35,700 374,850
Oshkosh Truck Corp., Class B . . . . . . . . . . . . . . . . . . . . . . . . . . 84,100 1,282,525
PACCAR Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,000 631,875
* Raymond Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,485 375,034
* Varity Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,900 330,413
------------
9,619,272
------------
CONSUMER ELECTRICAL: 0.35%
Black & Decker Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,200 394,800
Fedders Corp., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,400 284,050
Harman International Industries Inc. . . . . . . . . . . . . . . . . . . . . . . 16,930 679,316
* Helen Of Troy Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,200 298,200
------------
1,656,366
------------
CONTAINERS AND PACKAGING: 0.41%
Ball Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,300 200,750
* Continental Can Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,300 217,787
Federal Paper Board Co., Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 13,700 710,687
* Gaylord Container Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,300 179,794
Temple Inland Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,100 445,663
Tuscarora Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,800 164,900
------------
1,919,581
------------
DATA PROCESSING SYSTEMS: 2.64%
* Advanced Logic Research Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 17,400 104,400
* Amdahl Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,900 254,150
* CACI International Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . 59,800 710,125
Computer Task Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,600 387,100
* Dell Computer Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,200 1,184,175
* Digital Equipment Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,800 3,001,050
International Business Machines Corp. . . . . . . . . . . . . . . . . . . . . . 25,400 2,330,450
* Sequoia Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74,700 392,175
* Sun Microsystems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67,600 3,084,250
* Triad Systems Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,500 921,813
------------
12,369,688
------------
ELECTRICAL PRODUCTS: 0.91%
Charter Power Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,700 796,375
* Genlyte Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,800 349,650
Kollmorgen Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,340 366,740
Philips Electronics N.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67,600 2,425,150
Thomas Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,860 349,210
------------
4,287,125
------------
ELECTRONICS: 3.92%
* Advanced Semiconductors Corp. . . . . . . . . . . . . . . . . . . . . . . . . . 8,000 394,000
* Altron Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,700 1,491,000
* Bell Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,077 249,233
Burr Brown Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,500 1,797,750
* Computer Products Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102,600 1,179,900
CTS Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,000 792,750
* Electro Scientific Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . 16,200 473,850
* Electroglas Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,000 465,500
* Electromagnetic Science Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 6,200 68,200
* Esterline Technologies Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 30,300 715,838
* Hadco Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,900 784,687
Harris Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,800 1,190,825
Helix Technology Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,800 1,611,600
* Hutchinson Technology Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,600 405,600
Innovex Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,100 184,525
* Komag Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,500 714,938
* Kulicke & Soffa Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . 22,500 523,125
* Laser Industries Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,700 83,737
* LTX Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,100 210,788
* Novellus Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,200 388,800
* Orbotech Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,500 593,375
Park Electrochemical Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,200 1,194,600
* Read-Rite Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,200 399,900
* SCI Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,700 176,700
* Tech-Sym Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,500 908,438
* Teradyne Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,400 310,000
Varian Associates Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,600 124,150
Watkins Johnson Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,600 726,250
Wyle Electronics Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,600 161,575
------------
18,321,634
------------
ENGINEERING: 0.61%
Butler Manufacturing Company . . . . . . . . . . . . . . . . . . . . . . . . . . 45,700 1,793,725
Granite Construction Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,600 900,900
* Layne Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,400 139,500
------------
2,834,125
------------
</TABLE>
19
<PAGE> 22
ZWEIG APPRECIATION FUND
Statement of Net Assets as of December 31, 1995
(Continued)
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ENTERTAINMENT: 0.04%
* Carmike Cinemas Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,700 $ 173,250
------------
ENVIRONMENTAL SERVICES: 0.16%
* Tetra Technologies Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,900 641,137
* Western Waste Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 4,700 128,662
------------
769,799
------------
FARMING AND MILLING: 0.62%
Archer-Daniels-Midland Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . 156,985 2,825,730
Orange Co. Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,600 58,900
------------
2,884,630
------------
FINANCE: 1.08%
Dean Witter, Discover & Co. . . . . . . . . . . . . . . . . . . . . . . . . . . 23,800 1,118,600
Finova Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,300 593,475
First Financial Caribbean Co. . . . . . . . . . . . . . . . . . . . . . . . . . 28,000 525,000
* Investors Financial Services Corp., Class A . . . . . . . . . . . . . . . . . . 387 8,030
Transamerica Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,200 597,575
Travelers Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,400 1,471,275
United Cos. Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 6,000 158,250
Value Line Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,900 573,650
------------
5,045,855
------------
FLUID CONTROLS: 0.57%
* Central Sprinkler Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,400 1,079,200
Graco Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,300 588,650
* IMO Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,500 257,812
Parker-Hannifin Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,400 321,950
Robbins & Myers Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,600 438,000
------------
2,685,612
------------
FOOD AND BEVERAGES: 1.23%
* Alpine Lace Brands Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,200 77,900
Chiquita Brands International Inc. . . . . . . . . . . . . . . . . . . . . . . . 9,600 132,000
* Chock Full O' Nuts Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,735 213,859
Coca Cola Enterprises Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,900 505,575
Hudson Foods Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . 57,150 985,837
IBP Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,000 1,767,500
International Multifoods Corp. . . . . . . . . . . . . . . . . . . . . . . . . . 23,000 462,875
Seaboard Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,600 430,200
* Seneca Foods Corp., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . 26,100 482,850
* Seneca Foods Corp., Class B . . . . . . . . . . . . . . . . . . . . . . . . . . 34,800 678,600
------------
5,737,196
------------
FOREST AND PAPER PRODUCTS: 4.89%
Abitibi Price Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,200 234,900
American Israeli Paper Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,100 89,775
Boise Cascade Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,100 626,712
Bowater Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,300 756,150
Champion International Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 59,100 2,482,200
Chesapeake Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,400 367,350
Consolidated Papers Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,500 308,688
* Domtar Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63,700 485,712
Georgia-Pacific Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,600 2,168,550
International Paper Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62,200 2,355,825
Macmillan Bloedel Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67,400 817,225
Mead Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,400 2,006,400
* Mercer International Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,700 1,039,350
Mosinee Paper Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,360 215,270
Potlatch Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,300 332,000
Rayonier Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,300 477,262
* Repap Enterprises Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,300 187,706
Union Camp Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41,400 1,971,675
Westvaco Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,700 1,018,425
Weyerhaeuser Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56,900 2,460,925
Willamette Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,700 2,458,125
------------
22,860,225
------------
HEALTHCARE FACILITIES AND PRODUCTS: 0.52%
Community Psychiatric Centers Corp. . . . . . . . . . . . . . . . . . . . . . . 4,000 49,000
ICN Pharmaceuticals Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,900 132,825
* Maxicare Health Plans Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,900 696,063
Novo-Nordisk., A. S., ADR . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,200 40,800
* OrNda Healthcorp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45,400 1,055,550
* PCI Services Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,000 477,750
------------
2,451,988
------------
HOME BUILDING AND LAND DEVELOPMENT: 0.81%
* Champion Enterprises Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,400 1,062,100
Continental Homes Holdings . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,500 677,188
M.D.C. Holdings Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76,800 547,200
Patten Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,361 110,965
* Toll Brothers Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,600 335,800
* U.S. Home Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,800 693,175
U.S. Home Corp., Warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,529 82,819
Webb (Del) Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,100 283,762
------------
3,793,009
------------
HOTELS AND RESORTS: 0.04%
* Prime Hospitality Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,200 182,000
------------
HOUSEHOLD PRODUCTS: 0.24%
* Chromcraft Revington Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,500 519,188
Oneida Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,200 585,150
------------
1,104,338
------------
INDUSTRIAL PRODUCTS, SERVICES AND MACHINERY: 2.64%
A. P. Green Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 13,400 261,300
Acme-Cleveland Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,700 106,875
Albany International Corp., Class A . . . . . . . . . . . . . . . . . . . . . . 2,400 43,500
American Filtrona Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,200 213,900
Ampco-Pittsburgh Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,400 434,300
Applied Power Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . 16,000 480,000
BMC Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142,000 3,301,500
Brady W.H. & Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,100 488,700
Furon Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,500 330,000
Gleason Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,500 991,250
Harnischfeger Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 14,100 468,825
Katy Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,500 467,125
Kennametal Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,100 130,175
Kysor Industrial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,500 739,625
MacDermid Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,000 1,368,500
Mine Safety Appliances Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 5,300 254,400
Regal Beloit Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,900 432,825
* Rogers Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,000 130,500
Tecumseh Products Co., Class A . . . . . . . . . . . . . . . . . . . . . . . . . 20,500 1,060,875
Varlen Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,920 664,780
------------
12,368,955
------------
INSURANCE: 4.16%
Ace Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,500 337,875
Aegon N.V. ADR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,589 377,916
American Annuity Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62,100 737,438
American National Insurance Co. . . . . . . . . . . . . . . . . . . . . . . . . 14,400 957,600
American Re Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,900 241,163
* CNA Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,800 2,133,800
EXEL Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,600 768,600
Independent Insurance Group . . . . . . . . . . . . . . . . . . . . . . . . . . 24,400 664,900
* ITT Hartford Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,800 715,950
Midland Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,100 54,038
NAC Re Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,100 75,600
National Re Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,300 505,400
Old Republic International Corp. . . . . . . . . . . . . . . . . . . . . . . . . 30,600 1,086,300
Orion Capital Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,300 186,513
PartnerRE Holdings Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,900 767,250
Pioneer Financial Services Inc. . . . . . . . . . . . . . . . . . . . . . . . . 41,900 775,150
Poe & Brown Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000 248,750
Protective Life Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44,800 1,400,000
PXRE Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,300 670,450
Reliastar Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,883 127,933
RLI Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,750 643,750
Selective Insurance Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 22,900 812,950
St. Paul Companies Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,600 2,425,250
SunAmerica Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,150 434,625
</TABLE>
20
<PAGE> 23
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INSURANCE (CONTINUED)
TIG Holdings Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,800 $ 108,300
Transatlantic Holdings Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 6,400 469,600
USF&G Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62,300 1,051,312
Washington National Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,700 571,838
Western National Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,700 91,912
------------
19,442,163
------------
INVESTMENT BANKING AND BROKERAGE: 1.23%
Alex Brown Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,200 1,562,400
Fahnestock Viner Holdings Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 34,700 323,144
Jefferies Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,000 850,500
Lehman Brothers Holdings Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 24,200 514,250
McDonald & Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,400 565,200
Quick & Reilly Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 66,874 1,370,917
* Sherwood Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56,000 483,000
Waterhouse Investors Services Inc. . . . . . . . . . . . . . . . . . . . . . . . 3,500 86,625
------------
5,756,036
------------
INVESTMENT MANAGEMENT: 0.16%
* Atalanta/Sosnoff Capital Corp. . . . . . . . . . . . . . . . . . . . . . . . . . 4,500 65,250
Eaton Vance Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,500 155,375
* White River Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,500 519,750
------------
740,375
------------
LAWN CARE PRODUCTS: 0.18%
Briggs & Stratton Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,600 286,275
Toro Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,900 555,587
------------
841,862
------------
MANUFACTURING: 1.01%
* ACX Technologies Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,300 170,913
Blount Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,250 216,563
Core Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,600 252,350
Global Industrial Technologies Inc. . . . . . . . . . . . . . . . . . . . . . . 46,600 879,575
Olin Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,800 579,150
Standex International Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 7,600 248,900
Synalloy Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,450 263,006
Teledyne Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,700 427,937
Transtechnology Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,900 336,150
Tredegar Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,600 767,000
Trinity Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,600 207,900
TRINOVA Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,100 231,862
Valmont Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,800 143,550
------------
4,724,856
------------
MARINE TRANSPORTATION: 0.40%
International Shipholding Corp. . . . . . . . . . . . . . . . . . . . . . . . . 30,250 627,688
Oglebay Norton Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,000 409,750
Stolt Nielsen S.A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,500 851,812
------------
1,889,250
------------
MEDICAL INSTRUMENTS AND SUPPLIES: 0.51%
Allied Healthcare Products Co. . . . . . . . . . . . . . . . . . . . . . . . . . 68,300 1,092,800
Bindley Western Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . 18,000 306,000
* Bio-Radiology Labs Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,500 318,750
Foxmeyer Health Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,700 98,975
Kinetic Concepts Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44,100 529,200
* North American Biologicals Inc. . . . . . . . . . . . . . . . . . . . . . . . . 4,400 47,300
------------
2,393,025
------------
METAL FABRICATION: 1.01%
Amcast Industrial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,000 273,750
Brenco Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,400 280,850
Commercial Metals Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,933 443,842
* Intermet Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,800 417,900
Kaydon Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700 21,262
* Mueller Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,600 778,050
Penn Engineering & Manufacturing Corp. . . . . . . . . . . . . . . . . . . . . . 700 67,900
Pitt-Des Moines Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,300 592,875
Precision Castparts Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,950 554,513
SPS Technologies Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,500 827,313
Timken Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,500 478,125
------------
4,736,380
------------
METALS AND MINING: 2.71%
Alcan Aluminum Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66,600 2,072,925
* Alumax Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,200 710,500
Aluminum Company of America . . . . . . . . . . . . . . . . . . . . . . . . . . 33,900 1,792,463
ASARCO Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,000 576,000
Brush Wellman Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,900 222,525
Cyprus Amax Minerals Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75,200 1,964,600
* First Mississippi Gold Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 19 423
* Magma Copper Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,600 1,048,100
* MAXXAM Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,400 84,600
Phelps Dodge Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,000 2,365,500
Reynolds Metals Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,100 1,817,662
------------
12,655,298
------------
OFFICE AUTOMATION AND EQUIPMENT: 0.25%
Kimball International Inc., Class B . . . . . . . . . . . . . . . . . . . . . . 7,600 191,900
Nam Tai Electronics Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,300 461,775
* Network Equipment Technologies Inc. . . . . . . . . . . . . . . . . . . . . . . 6,300 172,463
* Proteon Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53,900 357,088
------------
1,183,226
------------
OIL AND GAS: 3.27%
* American Exploration Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,000 135,000
Atwood Oceanics Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,100 1,315,525
British Petroleum Plc., ADR . . . . . . . . . . . . . . . . . . . . . . . . . . 17,872 1,825,178
Coastal Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68,900 2,566,525
* Crystal Oil Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,000 331,375
Diamond Shamrock Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,400 217,350
Digicon Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48,955 391,640
Fina Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,200 363,600
Getty Petroleum Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,400 180,900
* Lufkin Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,400 348,425
Lyondell Petrochemical Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,900 134,962
Mobil Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,700 1,198,400
Occidental Petroleum Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74,800 1,598,850
* Plains Research Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,000 450,000
* Pride Petroleum Services Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 81,000 860,625
Repsol S.A., ADR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,100 1,515,537
* RPC Energy Services Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59,760 545,310
* Smith International Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,100 237,350
* Tesoro Petroleum Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,300 235,462
* Tuboscope Vetco International Co. . . . . . . . . . . . . . . . . . . . . . . . 63,000 358,313
Williams Companies Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,699 469,419
------------
15,279,746
------------
PERSONAL CARE PRODUCTS: 0.25%
* Jean Philippe Fragrances Co. . . . . . . . . . . . . . . . . . . . . . . . . . . 18,300 148,688
Kimberly Clark Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,480 1,032,720
------------
1,181,408
------------
POLLUTION CONTROL EQUIPMENT: 0.20%
BHA Group Inc.,Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,700 287,525
* Gundle/SLT Environmental Corp. . . . . . . . . . . . . . . . . . . . . . . . . . 77,500 431,094
Met Pro Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,580 213,232
------------
931,851
------------
PRECISION INSTRUMENTS: 0.60%
* Coherent Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,000 1,174,500
Fluke Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,900 109,475
* Galileo Electro-Optics Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 44,800 464,800
* Genrad Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,400 359,975
Newport Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,900 39,812
Technitrol Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,200 641,550
------------
2,790,112
------------
PRINTING AND FORMS: 0.64%
American Business Products Inc. . . . . . . . . . . . . . . . . . . . . . . . . 6,375 181,688
* Devon Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,400 1,086,938
</TABLE>
21
<PAGE> 24
ZWEIG APPRECIATION FUND
Statement of Net Assets as of December 31, 1995
(Continued)
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
PRINTING AND FORMS (CONTINUED)
Graphic Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99,600 $ 1,220,100
Quebecor Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,300 507,825
------------
2,996,551
------------
PUBLISHING: 0.12%
Plenum Publishing Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,600 569,400
------------
RAILROADS: 0.82%
Burlington Northern Santa Fe Corp. . . . . . . . . . . . . . . . . . . . . . . . 13,010 1,014,780
Conrail Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,600 2,002,000
CSX Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,600 803,000
------------
3,819,780
------------
REAL ESTATE INVESTMENT TRUSTS: 0.65%
Centerpoint Properties Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 22,600 522,625
CV REIT Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,100 417,375
CWM Mortgage Holdings Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,600 724,200
HRE Properties Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,300 215,975
Health & Retirement Properties Trust . . . . . . . . . . . . . . . . . . . . . . 1,500 24,375
Property Capital Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76,100 656,363
Public Storage Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,300 461,700
------------
3,022,613
------------
RECREATIONAL PRODUCTS: 0.23%
Coachmen Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,400 617,700
* First Team Sports Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,100 215,025
Outboard Marine Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,300 230,237
------------
1,062,962
------------
RENTAL AND LEASING: 1.44%
Aaron Rentals Inc., Class B . . . . . . . . . . . . . . . . . . . . . . . . . . 18,000 324,000
* Central Trans Rental Group, ADS . . . . . . . . . . . . . . . . . . . . . . . . 270,800 169,250
Comdisco Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74,850 1,693,481
* Electro Rent Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102,075 2,220,131
GATX Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,400 457,075
PHH Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,700 500,225
PS Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,775 266,331
Rollins Truck Leasing Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 14,625 162,703
Ryder Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,600 955,350
------------
6,748,546
------------
RESTAURANTS: 0.07%
* Quantum Restaurant Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,900 336,375
------------
RETAIL TRADE: 1.09%
* Autozone Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,000 808,500
Claire's Stores Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,900 192,113
* CompUSA Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,900 401,512
* Fabri-Centers America Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,800 355,100
* Gottschalks Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,200 53,550
Great Atlantic & Pacific Tea Co. . . . . . . . . . . . . . . . . . . . . . . . . 18,200 418,600
* Intertan Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,000 29,000
* Kroger Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,800 292,500
Pier 1 Imports Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,710 121,826
Regis Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,600 374,400
* Rex Stores Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,500 62,125
Riser Foods Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,700 607,912
Ross Stores Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,700 453,263
* Safeway Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,000 566,500
Schultz Sav-O Stores Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,900 219,775
Shopko Stores Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,300 160,875
------------
5,117,551
------------
SAVINGS & LOAN ASSOCIATIONS: 1.58%
Astoria Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,700 716,313
California Federal Bank Corp. . . . . . . . . . . . . . . . . . . . . . . . . . 13,200 207,900
Charter One Financial Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,900 517,563
Commercial Federal Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,100 268,025
* Dime Bancorp Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100,900 1,172,962
Firstfed Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,100 354,538
* Glendale Federal Bank Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 10,900 190,750
Greenpoint Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,600 470,800
Long Island Bancorp Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,400 511,675
Standard Federal Bank Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 36,100 1,421,438
TCF Financial Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,800 887,750
Westcorp Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,500 675,250
------------
7,394,964
------------
SHOES: 0.17%
Weyco Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 800 31,400
Wolverine Worldwide Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,700 746,550
------------
777,950
------------
STEEL: 2.16%
* AK Steel Holdings Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,700 880,225
British Steel Plc, ADS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,900 1,278,688
Carpenter Technology Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,300 711,463
Chaparral Steel Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,400 559,450
Cleveland Cliffs Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,400 631,400
Lone Star Technologies Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 35,400 389,400
* LTV Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57,700 793,375
* National Steel Corp., Class B . . . . . . . . . . . . . . . . . . . . . . . . . 25,000 321,875
Quanex Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,000 251,875
Roanoke Electric Steel Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 69,000 1,147,125
* Steel of West Virginia Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . 69,200 640,100
Texas Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,700 1,203,100
* Tubos De Acero de Mexico, ADR . . . . . . . . . . . . . . . . . . . . . . . . . 87,800 614,600
* WHX Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61,800 672,075
------------
10,094,751
------------
TELECOMMUNICATIONS: 0.67%
* Interdigital Communications Corp. . . . . . . . . . . . . . . . . . . . . . . . 11,300 83,337
* Norstan Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,000 404,000
Telefonica de Espana, S.A. ADS . . . . . . . . . . . . . . . . . . . . . . . . . 42,800 1,792,250
* VTEL Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45,600 843,600
------------
3,123,187
------------
TEXTILES: 0.21%
Guilford Mills Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,700 442,137
Springs Industries Inc., Class A . . . . . . . . . . . . . . . . . . . . . . . . 4,800 198,600
* Westpoint Stevens Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,300 347,081
------------
987,818
------------
TOBACCO: 0.19%
* Culbro Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,500 908,812
------------
TRUCKING: 0.25%
* Builders Transport Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,000 137,250
* FRP Properties Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,100 699,050
* Matlack Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,050 315,437
------------
1,151,737
------------
UTILITIES: 6.79%
American Water Works Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,000 466,500
Baltimore Gas & Electric Co. . . . . . . . . . . . . . . . . . . . . . . . . . . 39,100 1,114,350
Boston Edison Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,300 421,850
Centerior Energy Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,500 244,063
Central Vermont Public Services Corp. . . . . . . . . . . . . . . . . . . . . . 23,500 314,313
CILCORP Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000 127,125
CMS Energy Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,300 576,587
* Columbia Gas Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,700 1,654,088
Consolidated Edison Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,300 713,600
DQE Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,400 319,800
Duke Power Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,600 1,402,300
Eastern Enterprises Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,400 84,600
Empresa Nacionale de Electricidad, ADR . . . . . . . . . . . . . . . . . . . . . 10,600 606,850
Entergy Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59,000 1,725,750
Florida Progress Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,700 1,262,887
FPL Group Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,200 936,775
General Public Utilities Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 21,700 737,800
Illinova Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,500 585,000
Interstate Power Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,900 761,425
New York State Electric & Gas Co. . . . . . . . . . . . . . . . . . . . . . . . 16,100 416,587
NIPSCO Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,300 585,225
Northeast Utilities Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . 92,700 2,259,562
</TABLE>
22
<PAGE> 25
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
UTILITIES (CONTINUED)
Ohio Edison Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45,600 $ 1,071,600
Pacific Enterprises Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,600 271,200
Pacific Gas & Electric Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . 86,600 2,457,275
Pinnacle West Capital Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . 23,800 684,250
Portland General Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,300 1,464,988
* Public Service Co. of New Mexico . . . . . . . . . . . . . . . . . . . . . . . . 32,300 569,288
Rochester Gas & Electric Co. . . . . . . . . . . . . . . . . . . . . . . . . . . 15,200 343,900
SCE Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154,000 2,733,500
Sierra Pacific Resources Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 12,600 294,525
Southern Union Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,925 755,606
ST. Joseph Light & Power Co. . . . . . . . . . . . . . . . . . . . . . . . . . . 1,300 46,150
TNP Enterprises Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,400 682,500
Unicom Corp. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83,900 2,747,725
United Illumination Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,300 85,962
Westcoast Energy Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,300 238,387
------------
31,763,893
------------
WHOLESALE DISTRIBUTORS: 0.50%
Bearings Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,900 143,325
Castle A. M. & Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,500 1,054,688
Hughes Supply Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,100 426,575
Noland Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,400 583,200
* Rexel Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,000 108,000
------------
2,315,788
------------
TOTAL COMMON STOCKS
(Cost $312,356,440) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 401,232,376
------------
Principal
Amount
----------
SHORT-TERM OBLIGATIONS: 0.63%
UNITED STATES TREASURY BILLS: 0.63%
4.93%, 3/14/96 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,000,000(a) 990,199
5.21%, 3/14/96 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000,000(a) 1,980,398
------------
TOTAL SHORT-TERM OBLIGATIONS
(Cost $2,968,874) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,970,597
------------
REPURCHASE AGREEMENTS: 13.71%
With Morgan Stanley & Co., Inc. (dated
12/29/95), 5.95%, due 1/2/96 (Repurchase
proceeds $29,132,247); collateralized by:
$27,527,000 of various United States
Government Agency Obligations,
8.00%-9.00%, 1/15/97-12/1/2025
(Market value $29,968,959) . . . . . . . . . . . . . . . . . . . . . . . . . . 29,113,000 29,113,000
<CAPTION>
Principal
Amount
or Number Value
of Contracts (Note 2)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
With Prudential Securities Inc. (dated 12/29/95),
5.95%, due 1/2/96 (Repurchase proceeds
$35,023,139); collateralized by: $35,225,133 of
various United States Government Agency
Obligations, 6.125%-7.50%,
2/15/2001-12/20/2025 (Market value
$35,700,616) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $35,000,000 $ 35,000,000
------------
TOTAL REPURCHASE AGREEMENTS
(Cost $64,113,000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,113,000
------------
NET UNREALIZED APPRECIATION ON
FUTURES CONTRACTS: 0.08%
Standard & Poor's 500 March 1996
Short futures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (24) 76,425
Mid-Cap 400 March 1996 Short futures . . . . . . . . . . . . . . . . . . . . . . (168) 300,775
------------
Total Appreciation on Futures Contracts (b) . . . . . . . . . . . . . . . . . . 377,200
------------
TOTAL INVESTMENTS
(Cost $379,438,314) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.19% 468,693,173
Other Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.28 1,290,481
-------- ------------
Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.47% 469,983,654
Total Liabilities (Note 7) . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.47) (2,189,740)
-------- ------------
NET ASSETS (NOTE 9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.00% $467,793,914
======== ============
CLASS A SHARES
Net asset value (NAV) and redemption price per share
($272,589,698/17,130,664 shares) . . . . . . . . . . . . . . . . . . . . . . . $15.91
======
Maximum public offering price per share- NAV/(1-maximum
sales charge) ($15.91/.945) . . . . . . . . . . . . . . . . . . . . . . . . . $16.84
======
CLASS C SHARES
Net asset value and offering price per share
($195,204,216/12,329,786 shares) . . . . . . . . . . . . . . . . . . . . . . . $15.83
======
Redemption price per share . . . . . . . . . . . . . . . . . . . . . . . . . . . **
======
</TABLE>
* Non-income producing security.
** Varies by length of time shares are held. ( Note 3b)
(a) Pledged as collateral for futures transactions.
(b) The market value of the short futures was $25,737,600 (representing
5.50% of the Fund's net assets) with a cost of $26,114,800.
For Federal income tax purposes, the tax basis of investments owned at
December 31, 1995 was $379,517,980 and unrealized appreciation on investments
consisted of:
<TABLE>
<S> <C>
Gross unrealized appreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . $95,626,837
Gross unrealized depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,451,644)
-----------
Net unrealized appreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . $89,175,193
===========
</TABLE>
See notes to financial statements.
23
<PAGE> 26
ZWEIG MANAGED ASSETS
Statement of Net Assets as of December 31, 1995
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS: 44.16%
UNITED STATES: 20.10%
AEROSPACE: 0.27%
Textron Inc. . . . . . . . . . . . . 8,900 $ 600,750
United Technologies Corp. . . . . . . 12,800 1,214,400
------------
1,815,150
------------
AIRLINES: 0.05%
Delta Air Lines Inc. . . . . . . . . . 4,100 302,887
------------
AUTOMOBILES: 0.62%
Ford Motor Co. . . . . . . . . . . . 62,900 1,824,100
General Motors Corp. . . . . . . . . 43,900 2,321,212
------------
4,145,312
------------
BANKS: 0.94%
BankAmerica Corp. . . . . . . . . . . 47,600 3,082,100
Bankers Life Holding Corp. . . . . . 6,800 137,700
Bankers Trust NY Corp. . . . . . . . 10,100 671,650
Mellon Bank Corp. . . . . . . . . . . 18,200 978,250
PNC Bank Corp. . . . . . . . . . . . 29,500 951,375
US Bancorp. . . . . . . . . . . . . . 12,700 427,037
------------
6,248,112
------------
BIOTECHNOLOGY: 0.04%
* Chiron Corp. . . . . . . . . . . . . 2,100 232,050
------------
BROADCASTING: 0.38%
* Viacom Inc., Class B . . . . . . . . . 53,300 2,525,087
------------
BUILDING MATERIALS & PRODUCTS: 0.42%
* Applied Materials Inc. . . . . . . . . 30,100 1,185,187
Ingersoll-Rand Inc. . . . . . . . . . 12,500 439,063
Johnson Controls Inc. . . . . . . . . 7,600 522,500
USG Corp. . . . . . . . . . . . . . . 22,000 660,000
------------
2,806,750
------------
CASINO OPERATORS: 0.01%
Harrah's Entertainment Inc. . . . . . 2,100 50,925
------------
CHEMICALS: 0.45%
Albemarle Corp. . . . . . . . . . . . 1,400 27,125
Ethyl Corp. . . . . . . . . . . . . . 2,500 31,250
IMC Global Corp. . . . . . . . . . . . 10,200 416,925
Olin Corp. . . . . . . . . . . . . . . 3,900 289,575
PPG Industries Inc. . . . . . . . . . 31,800 1,454,850
Rohm & Haas Inc. . . . . . . . . . . . 10,900 701,687
Union Carbide Corp. . . . . . . . . . 2,900 108,750
------------
3,030,162
------------
COMPUTERS & SOFTWARE: 0.54%
* Dell Computer Corp. . . . . . . . . . 3,500 121,187
* Oracle Systems Corp. . . . . . . . . . 70,700 2,995,912
* Sybase Inc. . . . . . . . . . . . . . 11,600 417,600
* Tandem Computers Inc. . . . . . . . . 3,100 32,937
* Unisys Corp. . . . . . . . . . . . . . 4,500 25,312
------------
3,592,948
------------
CONGLOMERATES: 0.98%
Tenneco Inc. . . . . . . . . . . . . . 37,300 1,851,012
Westinghouse Electric Corp. . . . . . 285,100 4,704,150
------------
6,555,162
------------
CONSTRUCTION EQUIPMENT: 0.09%
Stewart & Stevenson Inc. . . . . . . . 22,700 573,175
------------
CONTAINERS: 0.09%
Stone Container Corp. . . . . . . . . 14,700 211,312
Temple-Inland Inc. . . . . . . . . . 9,100 401,538
------------
612,850
------------
ELECTRICAL EQUIPMENT: 0.50%
* American Power Conversion Corp. . . . 34,400 326,800
Exide Corp. . . . . . . . . . . . . . 7,400 339,475
Whirlpool Corp. . . . . . . . . . . . 50,800 2,705,100
------------
3,371,375
------------
ELECTRONICS: 0.58%
Intel Corp. . . . . . . . . . . . . . 21,800 1,237,150
Micron Technology Corp. . . . . . . . 5,500 217,937
Motorola Inc. . . . . . . . . . . . . 15,600 889,200
Teledyne Inc. . . . . . . . . . . . . 9,000 230,625
Teledyne Inc., Pfd. . . . . . . . . . 134 1,926
Tyco International Ltd. . . . . . . . 26,300 936,938
* Western Digital Corp. . . . . . . . . 1,300 23,237
Xilinx Inc. . . . . . . . . . . . . . 11,600 353,800
------------
3,890,813
------------
ENGINEERING: 0.05%
Cincinnati Milacron Corp. . . . . . . 6,400 168,000
Harnischfeger Industries Inc. . . . . 5,600 186,200
------------
354,200
------------
FINANCE: 0.07%
Countrywide Credit Corp. . . . . . . . 21,300 463,275
------------
FOOD & BEVERAGES: 0.93%
Brown-Forman Corp., Class A . . . . . 700 26,162
Brown-Forman Corp., Class B . . . . . 1,000 36,500
ConAgra Inc. . . . . . . . . . . . . 25,700 1,060,125
Lancaster Colony Inc. . . . . . . . . 2,800 104,300
Pepsico Inc. . . . . . . . . . . . . . 85,000 4,749,375
Tyson Foods Inc., Class A . . . . . . 8,200 214,225
------------
6,190,687
------------
FOREST & PAPER PRODUCTS: 0.29%
Weyerhaeuser Co. . . . . . . . . . . 33,300 1,440,225
Willamette Industries Inc. . . . . . 8,900 500,625
------------
1,940,850
------------
HOSPITAL & HEALTHCARE: 1.43%
* Foundation Health Corp. . . . . . . . 16,100 692,300
* Health Systems International Inc. . . 23,600 758,150
Oxford Health Plans Inc. . . . . . . 33,900 2,504,362
Pfizer Inc. . . . . . . . . . . . . . 31,700 1,997,100
* United Health Corp. . . . . . . . . . 49,400 3,235,700
* Value Health Inc. . . . . . . . . . . 15,100 415,250
------------
9,602,862
------------
HOUSEHOLD PRODUCTS: 0.52%
Black & Decker Corp. . . . . . . . . 16,000 564,000
Colgate Palmolive Corp. . . . . . . . 5,400 379,350
Newell Co. . . . . . . . . . . . . . . 15,000 388,125
Procter & Gamble Co. . . . . . . . . . 25,700 2,133,100
------------
3,464,575
------------
INSURANCE: 0.66%
American Re Corp. . . . . . . . . . . 1,500 61,312
Cigna Corp. . . . . . . . . . . . . . 28,800 2,973,600
Conseco Inc. . . . . . . . . . . . . . 7,700 482,213
Marsh & McLennan Co. . . . . . . . . . 2,400 213,000
Old Republic International Inc. . . . 19,700 699,350
------------
4,429,475
------------
INVESTMENT BANKING & BROKERAGE: 0.41%
JP Morgan & Co. . . . . . . . . . . . 24,200 1,942,050
Salomon Brothers Inc. . . . . . . . . 22,300 791,650
------------
2,733,700
------------
LEISURE & ENTERTAINMENT: 0.03%
Fleetwood Enterprises Inc. . . . . . . 2,700 69,525
Time Warner Corp. . . . . . . . . . . 3,200 121,200
------------
190,725
------------
METALS & MINING: 0.27%
Freeport McMoran Copper &
Gold Corp., Class A . . . . . . . . 400 11,200
Reynolds Metals Inc. . . . . . . . . . 7,000 396,375
</TABLE>
24
<PAGE> 27
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ------------------------------------------------------------------------------
<S> <C> <C>
METALS & MININGS (CONTINUED)
Santa Fe Pacific Gold Corp. . . . . . 67,900 $ 823,288
Worthington Corp. . . . . . . . . . . 28,900 601,485
------------
1,832,348
------------
NATURAL GAS: 0.07%
Equitable Resources Inc. . . . . . . . 2,500 78,125
Sonat Inc. . . . . . . . . . . . . . . 11,400 406,125
------------
484,250
------------
OFFICE AUTOMATION & EQUIPMENT: 0.07%
Xerox Corp. . . . . . . . . . . . . . 3,600 493,200
------------
OIL & GAS: 2.56%
Enron Corp. . . . . . . . . . . . . . 33,300 1,269,563
Exxon Corp. . . . . . . . . . . . . . 25,000 2,003,125
Mobil Corp. . . . . . . . . . . . . . 20,000 2,240,000
Phillips Petroleum Corp. . . . . . . 43,300 1,477,613
Sun Co. Inc. . . . . . . . . . . . . . 41,100 1,125,113
Texaco Inc. . . . . . . . . . . . . . 93,400 7,331,900
Tosco Corp. . . . . . . . . . . . . . 20,200 770,125
USX-Marathon Group . . . . . . . . . . 47,400 924,300
------------
17,141,739
------------
PHARMACEUTICALS: 0.79%
Ivax Corp. . . . . . . . . . . . . . . 5,900 168,150
Merck & Co. . . . . . . . . . . . . . 61,700 4,056,775
Schering-Plough Inc. . . . . . . . . 18,400 1,007,400
Witco Corp. . . . . . . . . . . . . . 2,800 81,900
------------
5,314,225
------------
PHOTOGRAPHIC PRODUCTS: 0.06%
Polaroid Corp. . . . . . . . . . . . . 8,400 397,950
------------
PUBLISHING: 0.12%
New York Times Inc., Class A . . . . 26,400 782,100
------------
RAILROADS: 0.46%
Burlington Northern Santa Fe Corp. . 18,200 1,419,600
Conrail Inc. . . . . . . . . . . . . . 14,100 987,000
* Southern Pacific Rail Inc. . . . . . . 28,500 684,000
------------
3,090,600
------------
RESTAURANTS: 0.27%
Host Marriott Corp. . . . . . . . . . 65,500 867,875
Morrison Restaurants Inc. . . . . . . 700 9,800
Wendy's International Inc. . . . . . . 42,500 903,125
------------
1,780,800
------------
RETAIL TRADE: 0.94%
Kmart Corp. . . . . . . . . . . . . . 32,800 237,800
* Meyer (Fred) Inc. . . . . . . . . . . 11,000 247,500
Nike Inc., Class B . . . . . . . . . . 13,900 967,787
Sears, Roebuck and Co. . . . . . . . . 27,100 1,056,900
Wal-Mart Stores Co. . . . . . . . . . 163,700 3,662,788
Woolworth Corp. . . . . . . . . . . . 9,500 123,500
------------
6,296,275
------------
SAVINGS & LOAN ASSOCIATIONS: 0.21%
Great Western Financial Corp. . . . . 28,600 729,300
H.F. Ahmanson Corp. . . . . . . . . . 24,600 651,900
------------
1,381,200
------------
TELECOMMUNICATIONS: 1.55%
American Telephone & Telegraph Co. . . 71,000 4,597,250
Bay Networks Inc. . . . . . . . . . . 17,500 719,687
MCI Communications Corp. . . . . . . 36,700 958,788
SBC Communications Inc. . . . . . . . 33,000 1,897,500
* Tele-Communications Corp., Class A . . 106,400 2,114,700
* Vanguard Cellular Systems Inc. . . . . 2,200 44,550
------------
10,332,475
------------
TEXTILES: 0.15%
Shaw Industries Inc. . . . . . . . . 66,000 973,500
------------
TOBACCO: 0.43%
Philip Morris Companies . . . . . . . 19,800 1,791,900
RJR Nabisco Holdings Corp. . . . . . . 29,400 907,725
UST Inc. . . . . . . . . . . . . . . . 4,600 153,525
------------
2,853,150
------------
TRANSPORTATION: 0.01%
Alexander & Baldwin Inc. . . . . . . . 1,500 34,500
Tidewater Inc. . . . . . . . . . . . 1,800 56,700
------------
91,200
------------
UTILITIES: 1.79%
Centerior Energy Corp. . . . . . . . . 65,500 581,313
CMS Energy Corp. . . . . . . . . . . . 40,300 1,203,962
Northeast Utilities Corp. . . . . . . 59,900 1,460,063
Public Service Co. of Colorado . . . . 28,000 990,500
SCE Corp. . . . . . . . . . . . . . . 167,400 2,971,350
Texas Utilities Corp. . . . . . . . . 99,900 4,108,388
Utilicorp . . . . . . . . . . . . . . 20,200 593,375
Valero Energy Corp. . . . . . . . . . 3,200 78,400
------------
11,987,351
------------
TOTAL UNITED STATES (Cost
$125,900,608) . . . . . . . . . . . 134,355,470
------------
FOREIGN STOCKS: 24.06%
AUSTRALIA: 3.46%
BANKS: 0.52%
National Australia Bank . . . . . . . 255,851 2,302,838
Westpac Banking Corp.. . . . . . . . . 263,304 1,167,332
------------
3,470,170
------------
BUILDING MATERIALS & PRODUCTS: 0.10%
Boral Ltd., Co. . . . . . . . . . . . 257,639 651,595
------------
CHEMICALS: 0.07%
ICI Australia Inc. . . . . . . . . . 61,593 471,913
------------
CONGLOMERATES: 0.45%
CRA Ltd. . . . . . . . . . . . . . . 121,284 1,780,922
CSR Ltd. . . . . . . . . . . . . . . 192,911 628,523
Pacific Dunlop Ltd., Co. . . . . . . . 251,149 588,467
------------
2,997,912
------------
FOOD & BEVERAGES: 0.21%
Fosters Brewing Group . . . . . . . . 398,412 654,950
Goodman Fielder Ltd. . . . . . . . . . 397,939 399,610
SouthCorp Holdings . . . . . . . . . . 140,839 327,915
------------
1,382,475
------------
FOREST AND PAPER PRODUCTS: 0.12%
Amcor Ltd., Co. . . . . . . . . . . . 117,223 828,380
------------
METALS AND MINING: 0.40%
Australia National Industries Ltd. . . 128,921 95,891
Mim Holdings Ltd., Corp. . . . . . . . 326,203 451,302
Newcrest Mining Ltd. . . . . . . . . 12,109 50,981
Western Mining Corp. . . . . . . . . . 324,923 2,088,280
------------
2,686,454
------------
NEWSPAPERS & PUBLISHING: 0.43%
* News Corp., Ltd. . . . . . . . . . . 380,281 2,031,043
News Corp., Ltd., Pfd. . . . . . . . . 185,207 866,565
------------
2,897,608
------------
OIL AND GAS: 0.83%
* Ampolex Ltd., Inc. . . . . . . . . . . 104,005 227,449
Broken Hill Properties Ltd., Inc. . . 350,074 4,947,736
Santos Ltd., Inc. . . . . . . . . . . 128,421 375,413
------------
5,550,598
------------
REAL ESTATE: 0.21%
Lend Lease Corp. . . . . . . . . . . . 60,116 872,007
Westfield Trust . . . . . . . . . . . 291,130 524,063
------------
1,396,070
------------
</TABLE>
25
<PAGE> 28
ZWEIG MANAGED ASSETS
Statement of Net Assets as of December 31, 1995
(Continued)
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- -----------------------------------------------------------------------------
<S> <C> <C>
RETAIL TRADE: 0.12%
Coles Myer Ltd., Co. . . . . . . . . 261,246 $ 814,252
------------
TOTAL AUSTRALIA. . . . . . . . . . . . . . . . . 23,147,427
------------
CANADA: 1.93%
BANKS: 0.39%
Bank of Montreal . . . . . . . . . . . 29,000 659,167
Royal Bank of Canada . . . . . . . . . 48,200 1,099,996
Toronto Dominion Bank . . . . . . . . 49,600 872,826
------------
2,631,989
------------
CONGLOMERATES: 0.22%
Canadian Pacific Ltd. . . . . . . . . 47,300 857,313
Imasco Corp. . . . . . . . . . . . . 30,407 590,820
------------
1,448,133
------------
FOOD & BEVERAGES: 0.15%
Seagram Ltd., Co. . . . . . . . . . . 29,800 1,031,825
------------
METALS AND MINING: 0.42%
Alcan Aluminum Corp. . . . . . . . . 34,500 1,073,813
* Inco Ltd. . . . . . . . . . . . . . . 14,800 492,100
* Placer Dome Inc. . . . . . . . . . . 51,500 1,242,438
------------
2,808,351
------------
OIL AND GAS: 0.16%
Imperial Oil Ltd. . . . . . . . . . . 9,915 358,179
* Renaissance Energy Inc. . . . . . . . 28,500 710,491
------------
1,068,670
------------
RAILROADS: 0.09%
Bombardier Inc., Class B . . . . . . . 43,900 579,392
------------
TELECOMMUNICATIONS: 0.40%
BCE Inc. . . . . . . . . . . . . . . . 30,200 1,041,900
Moore Corp. Ltd. . . . . . . . . . . . 31,800 592,275
Northern Telecom Inc. . . . . . . . . 14,200 610,600
Thomson Corp. . . . . . . . . . . . . 31,200 434,653
------------
2,679,428
------------
UTILITIES: 0.10%
Nova Corp. . . . . . . . . . . . . . . 80,300 642,400
------------
TOTAL CANADA. . . . . . . . . . . . . . . . . . . 12,890,188
------------
FRANCE: 2.35%
AUTOMOBILES: 0.11%
Peugeot S.A. . . . . . . . . . . . . . 2,900 383,079
Renault Ord. . . . . . . . . . . . . . 13,200 380,584
------------
763,663
------------
BANKS: 0.33%
Banque National . . . . . . . . . . . 10,900 492,356
Cie Fin Paribas . . . . . . . . . . . 7,400 406,287
Compagnie De Suez . . . . . . . . . . 9,300 384,142
Credit Commercial De France . . . . . 5,350 273,387
Societe Generale . . . . . . . . . . . 5,250 649,490
------------
2,205,622
------------
BROADCASTING: 0.04%
Canal Plus . . . . . . . . . . . . . . 1,500 281,573
------------
BUILDING MATERIALS & PRODUCTS: 0.06%
LaFarge Coppee . . . . . . . . . . . . 6,450 416,118
------------
CHEMICALS: 0.16%
Air Liquide Co. . . . . . . . . . . . 3,950 655,051
Rhone Poulenc S.A. . . . . . . . . . . 18,150 389,321
------------
1,044,372
------------
CONGLOMERATES: 0.15%
AXA . . . . . . . . . . . . . . . . . 8,600 580,323
Lyonnais Des Eaux- Dumez . . . . . . . 4,050 390,476
------------
970,799
------------
CONSUMER PRODUCTS AND SERVICES: 0.51%
Cie Generale Des Eaux . . . . . . . . 6,700 669,811
Groupe Danone Co. . . . . . . . . . . 4,600 760,023
Loreal Co. . . . . . . . . . . . . . 3,300 884,655
Pinault-Printemps . . . . . . . . . . 1,650 329,637
* Promodes . . . . . . . . . . . . . . . 1,400 329,504
Sanofi SA . . . . . . . . . . . . . . 6,450 414,008
------------
3,387,638
------------
ELECTRONICS: 0.23%
Alcatel Alsthom . . . . . . . . . . . 8,300 716,562
* Legrand Inc. . . . . . . . . . . . . . 1,700 262,802
Michelin Inc. . . . . . . . . . . . . 6,800 271,561
* Schneider SA . . . . . . . . . . . . . 7,700 263,574
------------
1,514,499
------------
FOOD AND BEVERAGES: 0.16%
LVMH Moet Hennessy . . . . . . . . . . 5,100 1,063,721
------------
INSURANCE: 0.06%
Compagnie UAP . . . . . . . . . . . . 15,150 396,224
------------
OIL AND GAS: 0.16%
Societe Nationale Elf Aquitaine . . . 14,600 1,077,152
------------
RETAIL TRADE: 0.21%
Carrefour . . . . . . . . . . . . . . 1,400 850,527
Cie De St. Gobain . . . . . . . . . . 5,000 554,149
------------
1,404,676
------------
TOURISM: 0.04%
* Havas . . . . . . . . . . . . . . . . 3,550 282,018
------------
UTILITIES: 0.13%
Total SA, Class B . . . . . . . . . . 13,200 892,077
------------
TOTAL FRANCE . . . . . . . . . . . . . . . . . . . 15,700,192
------------
GERMANY: 3.54%
AUTOMOBILES: 0.52%
Daimler-Benz AG . . . . . . . . . . . 4,770 2,406,201
Volkswagen AG . . . . . . . . . . . . 3,097 1,037,760
------------
3,443,961
------------
BANKS: 0.69%
* Bayerische Hypotheken-Und . . . . . . 37,540 948,152
Deutsche Bank AG . . . . . . . . . . . 48,980 2,326,011
Dresdner Bank AG . . . . . . . . . . . 50,474 1,350,649
------------
4,624,812
------------
CHEMICALS: 0.63%
Bayer AG . . . . . . . . . . . . . . . 7,345 1,942,379
Hoechst AG . . . . . . . . . . . . . . 8,259 2,244,675
------------
4,187,054
------------
CONGLOMERATES: 0.16%
Viag AG . . . . . . . . . . . . . . . 2,667 1,071,438
------------
CONSUMER PRODUCTS AND SERVICES: 0.06%
Karstadt AG . . . . . . . . . . . . . 989 404,230
------------
ELECTRONICS: 0.33%
Siemens AG . . . . . . . . . . . . . . 4,066 2,230,044
------------
INSURANCE: 0.53%
Allianz AG Holding . . . . . . . . . . 1,816 3,547,558
------------
MACHINERY AND EQUIPMENT: 0.33%
Mannesmann AG . . . . . . . . . . . . 6,982 2,227,856
------------
UTILITIES: 0.29%
RWE AG . . . . . . . . . . . . . . . . 5,259 1,910,658
------------
TOTAL GERMANY . . . . . . . . . . . . . . . . . . 23,647,611
------------
HONG KONG: 1.05%
AIRLINES: 0.03%
* Cathay Pacific Airways, Ltd. . . . . . 116,000 177,028
------------
BANKS: 0.28%
Bank of East Asia . . . . . . . . . . 45,000 161,505
HSBC Holdings, Plc. . . . . . . . . . 115,200 1,743,206
------------
1,904,711
------------
</TABLE>
26
<PAGE> 29
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- -----------------------------------------------------------------------------
<S> <C> <C>
CONGLOMERATES: 0.23%
* Hutchison Whampoa Ltd. . . . . . . . . 129,000 $ 785,816
* South China Morning Post Holdings . . 204,000 124,664
* Swire Pacific Ltd., Class A . . . . . 80,000 620,800
------------
1,531,280
------------
CONSUMER SERVICES: 0.02%
* Hong Kong & Shanghi Hotel . . . . . . 89,000 143,308
------------
FOOD & BEVERAGES: 0.00%
Dairy Farm International Holdings . . 4,602 4,235
------------
REAL ESTATE: 0.32%
* Great Eagle Holdings . . . . . . . . . 33,000 85,358
Hong Kong Land Holdings Ltd. . . . . . 6,333 11,716
* Hopewell Holdings Ltd., Ord. . . . . . 216,000 124,308
Hysan Development . . . . . . . . . . 52,000 137,530
New World Development . . . . . . . . 89,000 387,906
Sun Hung Kai Properties . . . . . . . 135,000 1,104,340
* Wharf Holdings . . . . . . . . . . . . 89,000 296,397
------------
2,147,555
------------
TELECOMMUNICATIONS: 0.10%
* Hong Kong Telecommunications . . . . . 386,800 690,361
------------
UTILITIES: 0.07%
China Light & Power Co. . . . . . . . 41,000 188,772
Hong Kong Electric Holdings . . . . . 77,500 254,091
------------
442,863
------------
TOTAL HONG KONG . . . . . . . . . . . . . . . . . 7,041,341
------------
JAPAN: 4.24%
APPAREL: 0.04%
Nisshinbo Corp. . . . . . . . . . . . 30,000 290,832
------------
AUTOMOBILES: 0.18%
* Hino Motors Ltd. . . . . . . . . . . . 32,000 269,581
Suzuki Motor Corp. . . . . . . . . . 20,000 222,972
Toyota Motor Corp. . . . . . . . . . 34,000 721,847
------------
1,214,400
------------
BANKS: 0.21%
Fuji Bank Ltd. . . . . . . . . . . . . 22,000 486,273
Mitsubishi Bank . . . . . . . . . . . 25,000 588,937
Sumitomo Bank . . . . . . . . . . . . 17,000 360,924
------------
1,436,134
------------
BUILDING MATERIALS & PRODUCTS: 0.05%
Toto Ltd., Co. . . . . . . . . . . . 22,000 307,120
------------
CHEMICALS: 0.38%
Asahi Denka Kogyo KK . . . . . . . . . 40,000 336,200
* Konica Co. . . . . . . . . . . . . . . 36,000 261,050
Kuraray Co. . . . . . . . . . . . . . 32,000 350,550
Kyowa Hakko Kogyo . . . . . . . . . . 40,000 377,696
Nippon Chemical Industries . . . . . . 29,000 238,684
* Nisshin Chemical Industries . . . . . 67,000 444,927
Shin-Etsu Chemical . . . . . . . . . . 27,000 560,145
------------
2,569,252
------------
ELECTRONICS: 0.60%
* Matsushita Electric Industrial Co. . 33,000 537,458
* Nippondenso Corp. . . . . . . . . . . 29,000 542,599
Pioneer Electronic Inc. . . . . . . . 21,000 384,773
* Sankyo Co., Ltd. . . . . . . . . . . . 18,000 404,840
* Sharp Corp. . . . . . . . . . . . . . 31,000 495,870
Sony Corp. . . . . . . . . . . . . . . 21,000 1,260,183
Sumitomo Electric Industries Inc. . . 34,000 408,717
------------
4,034,440
------------
ENTERTAINMENT: 0.07%
* Tokyo Dome Corp. . . . . . . . . . . . 27,000 463,296
------------
FINANCE: 0.21%
* Japan Securities Finance . . . . . . . 23,000 329,999
* Nomura Securities Inc. . . . . . . . 48,000 1,047,000
------------
1,376,999
------------
FOOD AND BEVERAGES: 0.21%
Ajinomoto Inc. . . . . . . . . . . . . 31,000 345,607
Asahi Breweries . . . . . . . . . . . 33,000 390,298
Merican Corp. . . . . . . . . . . . . 47,000 344,919
* Nisshin Flour Milling Corp. . . . . . 27,000 303,629
------------
1,384,453
------------
FOREST AND PAPER PRODUCTS: 0.05%
New OJI Paper Co. Ltd. . . . . . . . . 34,000 307,856
------------
HOMEBUILDERS: 0.22%
* Daiwa House Industries Inc. . . . . . 20,000 329,610
* Obayashi Corp. . . . . . . . . . . . . 42,000 333,875
Shimizu Corp. . . . . . . . . . . . . 44,000 447,880
* Tekken Corp. . . . . . . . . . . . . 50,000 375,175
------------
1,486,540
------------
INSURANCE: 0.04%
* Mitsui Marine & Fire Insurance . . . . 42,000 299,674
------------
MACHINERY AND EQUIPMENT: 0.52%
Ebara Corp. . . . . . . . . . . . . . 27,000 395,242
* Hitachi Zosen Corp. . . . . . . . . . 52,000 269,698
Kawasaki Steel . . . . . . . . . . . . 199,000 694,510
* Koyo Seiko Corp. . . . . . . . . . . . 53,000 482,973
* Kyokuo Corp. . . . . . . . . . . . . . 20,000 104,894
* Meidensha Corp. . . . . . . . . . . . 44,000 272,567
* Mitsubishi Corp. . . . . . . . . . . . 42,000 517,100
* Nippon Sharyo Corp. . . . . . . . . . 41,000 395,482
* Okuma Corp.. . . . . . . . . . . . . . 38,000 355,494
------------
3,487,960
------------
MANUFACTURING: 0.26%
* NGK Insulators . . . . . . . . . . . . 27,000 269,600
* Nippon Piston Ring . . . . . . . . . . 62,000 328,172
Shinagawa Refract . . . . . . . . . . 28,000 249,729
* Toyo Seikan . . . . . . . . . . . . . 18,000 539,204
* Yamaha Corp. . . . . . . . . . . . . . 21,000 378,664
------------
1,765,369
------------
METALS & MINING: 0.20%
* Chiyoda Corp. . . . . . . . . . . . . 32,000 316,426
* Mitsubishi Steel Manufacturing . . . . 27,000 141,345
Shimura Kako Co. . . . . . . . . . . . 44,000 251,667
* Sumitomo Coal Mining . . . . . . . . . 23,000 114,160
* Sumitomo Metal Manufacturing . . . . . 37,000 332,867
* Toho Zinc Corp. . . . . . . . . . . . 20,000 148,324
------------
1,304,789
------------
PHARMACEUTICALS: 0.05%
Yamanouchi Pharmaceuticals . . . . . . 16,000 344,347
------------
PHOTOGRAPHIC PRODUCTS: 0.27%
Canon Inc. . . . . . . . . . . . . . . 30,000 543,858
Fuji Photo Film Ltd. . . . . . . . . . 20,000 577,788
* Nikkon Corp. . . . . . . . . . . . . . 21,000 285,016
* Ricoh Corp. . . . . . . . . . . . . . 35,000 383,414
------------
1,790,076
------------
PRINTING AND PUBLISHING: 0.08%
Dai Nippon Printing Co., Ltd. . . . . 31,000 525,924
------------
RAILROADS: 0.09%
* Keisei Electric Railway Co. . . . . . 34,000 286,759
Odakyu Electric Railway Co. . . . . . 44,000 300,718
------------
587,477
------------
REAL ESTATE: 0.04%
* Mitsui Fudosan Corp. . . . . . . . . . 22,000 270,862
------------
</TABLE>
27
<PAGE> 30
ZWEIG MANAGED ASSETS
Statement of Net Assets as of December 31, 1995
(Continued)
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- -----------------------------------------------------------------------------
<S> <C> <C>
RETAIL TRADE: 0.06%
* Marui Co., Ltd. . . . . . . . . . . . 19,000 $ 396,017
------------
TEXTILES: 0.04%
* Fuji Spinning Co., Ltd. . . . . . . . 36,000 160,888
* Toho Rayon Co., Ltd. . . . . . . . . . 33,000 121,249
------------
282,137
------------
TRANSPORTATION: 0.14%
* Mitsubishi Warehouse & Transportation Corp. 32,000 499,456
* Navix Line Corp. . . . . . . . . . . 58,000 170,932
* Nippon Yusen Kabashiki Kaisha . . . . 45,000 261,310
------------
931,698
------------
UTILITIES: 0.18%
* Iwatani International Corp. . . . . . 63,000 335,910
* Mitsubishi Oil Co. . . . . . . . . . . 43,000 382,261
* Nisshin Oil Mills Co. . . . . . . . . 36,000 271,170
Tokyo Gas Co. . . . . . . . . . . . . 54,000 190,550
------------
1,179,891
------------
WHOLESALE DISTRIBUTORS: 0.05%
* Marubeni Corp. . . . . . . . . . . . . 61,000 330,571
------------
TOTAL JAPAN . . . . . . . . . . . . . . . . . . . 28,368,114
------------
NEW ZEALAND: 0.39%
WHOLESALE DISTRIBUTORS: 0.39%
Telecom Corp. of New Zealand, Ltd. . . 603,000 2,601,764
------------
TOTAL NEW ZEALAND . . . . . . . . . . . . . . . . 2,601,764
------------
SPAIN: 3.05%
BANKS: 1.02%
* Argentaria SA . . . . . . . . . . . . 31,631 1,303,659
Banco Bilbao Vizcaya SA . . . . . . . 50,021 1,801,832
Banco Central Hispano . . . . . . . . 34,683 703,288
Banco De Santander SA . . . . . . . . 25,950 1,302,675
* Banco Espanol Credito . . . . . . . . 103,078 713,712
* Banco Popular Espanol . . . . . . . . 5,394 994,622
------------
6,819,788
------------
BUSINESS SERVICES: 0.10%
Autopistas Cesa Co. . . . . . . . . . 56,422 641,812
------------
ENERGY: 0.47%
Gas Natural . . . . . . . . . . . . . 7,238 1,127,617
Repsol Petroleo SA . . . . . . . . . 62,308 2,041,559
------------
3,169,176
------------
HOMEBUILDERS: 0.07%
Fomento De Construcion . . . . . . . . 6,472 496,138
------------
RETAIL TRADE: 0.17%
* Centros Com. Pryca SA . . . . . . . . 53,295 1,118,033
------------
TELECOMMUNICATIONS: 0.35%
Telefonica De Espana . . . . . . . . . 170,748 2,364,535
------------
UTILITIES: 0.87%
Empresa Nacionale de Electricidad . . 47,177 2,671,582
Iberdrola I SA . . . . . . . . . . . . 344,194 3,149,237
------------
5,820,819
------------
TOTAL SPAIN . . . . . . . . . . . . . . . . . . . 20,430,301
------------
SWITZERLAND: 0.95%
BANKS: 0.27%
HolderBank . . . . . . . . . . . . . . 100 76,913
Schweiz Bank . . . . . . . . . . . . . 480 109,295
Schweiz BankGesellschaft, Class B . . 480 521,444
Schweiz BankVerein . . . . . . . . . . 650 133,033
Schweiz BankVerein, Class B . . . . . 550 225,134
Schweiz Rueckversicherungs . . . . . . 300 349,889
Zurich Versicherungsgesellschaft . . . 1,350 404,771
------------
1,820,479
------------
ENVIRONMENTAL: 0.04%
BBC Brown Boveri AG . . . . . . . . . 200 232,912
------------
FINANCE: 0.07%
CS Holdings . . . . . . . . . . . . . 4,200 431,625
------------
FOOD & BEVERAGES: 0.15%
Nestle SA . . . . . . . . . . . . . . 920 1,020,223
------------
MANUFACTURING: 0.01%
S. M. H. AG . . . . . . . . . . . . . 100 59,966
------------
METALS & MINING: 0.01%
Alusuisse-Lonza . . . . . . . . . . . 100 79,433
------------
PHARMACEUTICALS: 0.40%
Ciba-Geigy . . . . . . . . . . . . . . 120 105,332
Ciba-Geigy AG . . . . . . . . . . . . 610 538,087
Roche Holdings AG . . . . . . . . . . 160 1,268,847
Sandoz AG . . . . . . . . . . . . . . 835 766,314
------------
2,678,580
------------
TOTAL SWITZERLAND . . . . . . . . . . . . . . . . 6,323,218
------------
UNITED KINGDOM: 3.10%
BANKS: 0.39%
Abbey National Plc. . . . . . . . . . 78,046 770,665
HSBC Holdings, Class A . . . . . . . . 22,128 345,620
HSBC Holdings . . . . . . . . . . . . 56,874 867,130
National Westminster Bank Plc. . . . . 47,944 483,098
Royal Bank of Scotland . . . . . . . . 12,392 112,745
------------
2,579,258
------------
BROADCASTING: 0.09%
Reed International Corp. . . . . . . . 37,800 576,318
------------
BUILDING MATERIALS & PRODUCTS: 0.15%
Redland Corp. . . . . . . . . . . . . 75,856 458,140
RMC Group Inc. . . . . . . . . . . . 23,600 363,114
Williams Holdings Co. . . . . . . . . 37,514 191,040
------------
1,012,294
------------
CHEMICALS: 0.08%
BOC Group . . . . . . . . . . . . . . 15,612 218,395
Imperial Chemical Industries Inc. . . 28,400 336,435
------------
554,830
------------
CONGLOMERATES: 0.10%
Hanson Co. . . . . . . . . . . . . . . 78,438 234,428
Siebe Plc. . . . . . . . . . . . . . 20,353 250,904
TI Group . . . . . . . . . . . . . . . 28,500 203,102
------------
688,434
------------
CONSUMER PRODUCTS AND SERVICES: 0.47%
BAA Plc. . . . . . . . . . . . . . . . 95,505 719,162
Caradon Plc. . . . . . . . . . . . . . 29,661 90,030
De La Rue Plc. . . . . . . . . . . . 11,902 120,298
Glaxo Holdings Plc. . . . . . . . . . 110,300 1,566,944
Smithkline Beecham . . . . . . . . . . 20,480 225,759
Tomkins Corp. . . . . . . . . . . . . 90,153 394,717
------------
3,116,910
------------
FINANCE: 0.01%
Mercury Asset Management . . . . . . . 5,643 76,223
------------
FOOD AND BEVERAGES: 0.52%
Allied Domecq Plc. . . . . . . . . . . 50,900 414,890
BASS Plc. . . . . . . . . . . . . . . 21,408 238,980
Bat Industries Inc. . . . . . . . . . 121,472 1,070,290
Cadbury Schweppes Inc. . . . . . . . . 113,562 938,000
Unilever Plc. . . . . . . . . . . . . 30,800 632,657
United Biscuits Corp. . . . . . . . . 42,500 168,921
------------
3,463,738
------------
INSURANCE: 0.17%
Prudential Corp. . . . . . . . . . . . 101,647 654,932
Royal Insurance Co. . . . . . . . . . 57,014 338,144
</TABLE>
28
<PAGE> 31
<TABLE>
<CAPTION>
Number
of Shares/
Principal Value
Amount (Note 2)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INSURANCE (CONTINUED)
Sun Alliance Group Inc. . . . . . . . . . . . . . . . . . . 25,624 $ 148,591
-------------
1,141,667
-------------
MANUFACTURING: 0.02%
Rexam Plc. . . . . . . . . . . . . . . . . . . . . . . . . . 23,700 130,260
-------------
OIL AND GAS: 0.39%
British Petroleum Plc. . . . . . . . . . . . . . . . . . . . 218,354 1,827,296
Enterprise Oil Co. . . . . . . . . . . . . . . . . . . . . . 16,700 103,194
Shell Transport . . . . . . . . . . . . . . . . . . . . . . 52,696 697,068
-------------
2,627,558
-------------
RETAIL TRADE: 0.33%
Boots Co. . . . . . . . . . . . . . . . . . . . . . . . . . 25,948 236,080
Great Universal Stores Inc. . . . . . . . . . . . . . . . . 33,900 360,537
Marks & Spencer Corp. . . . . . . . . . . . . . . . . . . . 160,647 1,122,392
Sears Plc. . . . . . . . . . . . . . . . . . . . . . . . . . 56,328 90,953
Tesco Corp. . . . . . . . . . . . . . . . . . . . . . . . . 80,170 369,680
-------------
2,179,642
-------------
TELECOMMUNICATIONS: 0.21%
British Telecommunications Corp. . . . . . . . . . . . . . . 202,673 1,113,931
Cable & Wireless . . . . . . . . . . . . . . . . . . . . . . 43,786 312,715
-------------
1,426,646
-------------
TOURISM: 0.09%
Forte . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,316 253,055
Ladbroke Group . . . . . . . . . . . . . . . . . . . . . . . 39,411 89,640
Rank Organization Inc. . . . . . . . . . . . . . . . . . . . 38,900 281,445
-------------
624,140
-------------
UTILITIES: 0.08%
National Power Corp. . . . . . . . . . . . . . . . . . . . . 75,782 528,875
-------------
TOTAL UNITED KINGDOM . . . . . . . . . . . . . . . . . 20,726,793
-------------
TOTAL FOREIGN STOCKS (Cost $153,474,242) . . . . . . . . . . 160,876,949
------------
TOTAL COMMON STOCKS
(Cost $279,374,850) . . . . . . . . . . . . . . . . . . . 295,232,419
-------------
BONDS: 46.22%
UNITED STATES GOVERNMENT & AGENCY
OBLIGATIONS: 20.04%
FEDERAL HOME LOAN MORTGAGE CORP.: 0.45%
7.61%, 9/1/2004 . . . . . . . . . . . . . . . . . . . . . $ 2,900,000 2,972,790
-------------
FEDERAL NATIONAL MORTGAGE ASSN.: 0.91%
6.90%, 3/10/2004 . . . . . . . . . . . . . . . . . . . . . 2,900,000 2,934,620
7.60%, 4/14/2004 . . . . . . . . . . . . . . . . . . . . . 3,115,000 3,181,306
-------------
6,115,926
-------------
UNITED STATES TREASURY BONDS: 3.22%
7.625%, 2/15/2025 . . . . . . . . . . . . . . . . . . . . 17,600,000 21,510,474
-------------
UNITED STATES TREASURY NOTES: 15.46%
4.625%, 2/15/96 . . . . . . . . . . . . . . . . . . . . . 1,340,000 1,340,837
6.125%, 5/15/98 . . . . . . . . . . . . . . . . . . . . . 6,500,000 6,630,000
6.125%, 7/31/2000 . . . . . . . . . . . . . . . . . . . . 29,000,000 29,860,894
6.25%, 8/31/2000 . . . . . . . . . . . . . . . . . . . . . 20,500,000 21,217,500
7.50%, 2/15/2005 . . . . . . . . . . . . . . . . . . . . . 22,500,000 25,537,500
6.50%, 5/15/2005 . . . . . . . . . . . . . . . . . . . . . 17,600,000 18,760,474
-------------
103,347,205
-------------
TOTAL UNITED STATES GOVERNMENT &
AGENCY OBLIGATIONS
(Cost $128,855,255) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133,946,395
-------------
FOREIGN GOVERNMENT OBLIGATIONS: 26.18%
AUSTRALIAN GOVERNMENT BONDS: 2.89%
10.00%, 2/15/2006 . . . . . . . . . . . . . . . . . . . . A$ 10,100,000 8,424,612
10.00%, 10/15/2007 . . . . . . . . . . . . . . . . . . . . A$ 13,000,000 10,881,949
-------------
19,306,561
-------------
CANADIAN GOVERNMENT BONDS: 1.23%
8.75%, 12/1/2005 . . . . . . . . . . . . . . . . . . . . Can$ 10,000,000 8,213,190
-------------
DEUTSCHLAND REPUBLIC GOVERNMENT
BONDS: 4.50%
7.50%, 11/11/2004 . . . . . . . . . . . . . . . . . . . . DM 9,050,000 6,964,174
6.875%, 5/12/2005 . . . . . . . . . . . . . . . . . . . . DM 31,293,000 23,155,819
-------------
30,119,993
-------------
FINNISH GOVERNMENT BONDS: 2.03%
9.50%, 3/15/2004 . . . . . . . . . . . . . . . . . . . . .Fim 52,000,000 13,569,036
-------------
FRANCE O.A.T. BONDS: 4.25%
7.75%, 10/25/2005 . . . . . . . . . . . . . . . . . . . . ff 129,000,000 28,409,412
-------------
ITALIAN GOVERNMENT BONDS: 1.08%
10.50%, 4/1/2005 . . . . . . . . . . . . . . . . . . . . Lira 115,000,000 7,199,000
-------------
NEW ZEALAND GOVERNMENT BONDS: 2.15%
8.00%, 4/15/2004 . . . . . . . . . . . . . . . . . . . . .NZ$ 21,000,000 14,385,071
-------------
SPANISH GOVERNMENT BONDS: 1.81%
10.00%, 2/28/2005 . . . . . . . . . . . . . . . . . . . Pta 14,500,000 12,119,100
-------------
SWEDISH GOVERNMENT BONDS: 2.22%
6.00%, 2/09/2005 . . . . . . . . . . . . . . . . . . . . SKr 116,000,000 14,830,948
-------------
UNITED KINGDOM TREASURY BONDS: 4.02%
7.75%, 9/8/2006 . . . . . . . . . . . . . . . pound sterling 17,000,000 26,913,822
-------------
TOTAL FOREIGN GOVERNMENT OBLIGATIONS
(Cost $168,517,231) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175,066,133
-------------
TOTAL BONDS
(Cost $297,372,486) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 309,012,528
-------------
UNITED STATES SHORT-TERM OBLIGATIONS: 1.19%
FEDERAL NATIONAL MORTGAGE ASSN.
DISCOUNT NOTES: 0.74%
5.54%, 2/28/96 . . . . . . . . . . . . . . . . . . . . . . $ 5,000,000 4,957,085
-------------
UNITED STATES TREASURY BILLS: 0.45%
5.28%, 1/18/96 . . . . . . . . . . . . . . . . . . . . . . 1,000,000(a) 997,507
5.29%, 1/18/96 . . . . . . . . . . . . . . . . . . . . . . 1,000,000(a) 997,502
5.35%, 1/18/96 . . . . . . . . . . . . . . . . . . . . . . 1,000,000(a) 997,473
-------------
2,992,482
-------------
TOTAL UNITED STATES SHORT-TERM OBLIGATIONS
(Cost $7,947,855) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,949,567
-------------
UNITED STATES REPURCHASE AGREEMENTS: 5.21%
With Prudential Securities Inc. (dated 12/29/95),
5.95%, due 1/2/96 (Repurchase proceeds
$34,832,013); collateralized by: $34,824,617
various United States Government Agency
Obligations, 6.00%-7.00%, 11/20/2018-
10/20/2024 (Market value $35,518,464)
(Cost $34,809,000) . . . . . . . . . . . . . . . . . . 34,809,000 34,809,000
-------------
NET UNREALIZED DEPRECIATION ON FOREIGN
FORWARD CURRENCY CONTRACTS (NOTE 6): (0.22)% . . . . . . . . . . . . . . . . . . . . . . (1,451,966)
-------------
FOREIGN CURRENCY: 1.36%
Australian Dollar . . . . . . . . . . . . . . . . . . . . . A$ 86,183 64,103
Canadian Dollar . . . . . . . . . . . . . . . . . . . . . . C$ 78 57
French Franc . . . . . . . . . . . . . . . . . . . . . . . . ff 12 2
German Deutsche Mark . . . . . . . . . . . . . . . . . . . . DM 7,937 5,545
Hong Kong Dollar . . . . . . . . . . . . . . . . . . . . . .HK$ 655,703 84,782
Italian Lira . . . . . . . . . . . . . . . . . . . . . . . Lira 854,550 513
Japanese Yen . . . . . . . . . . . . . . . . . . . . . . . .yen 6,263,944 60,134
Mexican Peso . . . . . . . . . . . . . . . . . . . . . . . . P 16,128 2,092
New Zealand Dollar . . . . . . . . . . . . . . . . . . . . .NZ$ 13,448,729 8,791,434
Swiss Franc . . . . . . . . . . . . . . . . . . . . . . . . Sf 47,284 41,090
U.K. Pound Sterling . . . . . . . . . . . . . . pound sterling 7,302 11,337
-------------
TOTAL FOREIGN CURRENCY
(Cost $9,063,070) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,061,089
-------------
TOTAL INVESTMENTS
(Cost $628,567,261) . . . . . . . . . . . . . . . . . . . . 97.92% 654,612,637
Other Assets . . . . . . . . . . . . . . . . . . . . . . . . 3.57 23,851,701
-------- -------------
Total Assets . . . . . . . . . . . . . . . . . . . . . . . 101.49% 678,464,338
Total Liabilities (Note 7) . . . . . . . . . . . . . . . . (1.49) (9,921,875)
-------- -------------
NET ASSETS (Note 9) . . . . . . . . . . . . . . . . . . . . 100.00% $668,542,463
======== =============
</TABLE>
29
<PAGE> 32
ZWEIG MANAGED ASSETS
Statement of Net Assets as of December 31, 1995
(Concluded)
<TABLE>
<CAPTION>
Number Value
of Shares (Note 2)
- ------------------------------------------------------------------------------
<S> <C>
CLASS A SHARES
Net asset value (NAV) and redemption price per share
($141,110,333/11,306,313 shares) . . . . . . . . . . $12.48
======
Maximum public offering price per share- NAV/(1-maximum
sales charge) ($12.48/.945) . . . . . . . . . . . . . $13.21
======
CLASS C SHARES
Net asset value and redemption price per share
($527,432,130/42,230,677 shares) . . . . . . . . . . $12.49
======
Redemption price per share . . . . . . . . . . . . . . **
======
- ------------------------------------------------------------------------------
</TABLE>
* Non-income producing security.
** Varies by length of time shares are held (Note 3b).
(a) Pledged as collateral for futures transactions.
For Federal income tax purposes, the tax basis of investments owned at December
31, 1995 was $629,801,160 and unrealized appreciation on investments consisted
of :
<TABLE>
<S> <C>
Gross unrealized appreciation . . . . . . . . . . . $32,447,363
Gross unrealized depreciation . . . . . . . . . . . (7,635,886)
-----------
Net unrealized appreciation . . . . . . . . . . . . $24,811,477
===========
</TABLE>
INDUSTRY BREAKDOWN--COMMON STOCKS
<TABLE>
<CAPTION>
Value % Net Assets
- ------------------------------------------------------------------------------
<S> <C> <C>
Aerospace . . . . . . . . . . . . . . $ 1,815,150 0.27%
Airlines . . . . . . . . . . . . . . 479,915 0.07
Apparel . . . . . . . . . . . . . . . 290,832 0.04
Automobiles . . . . . . . . . . . . . 9,567,336 1.43
Banks . . . . . . . . . . . . . . . . 33,741,115 5.05
Biotechnology . . . . . . . . . . . . 232,050 0.03
Broadcasting . . . . . . . . . . . . 3,382,978 0.51
Building Materials & Products . . . . 5,193,877 0.78
Business Services . . . . . . . . . . 641,812 0.10
Casino Operators . . . . . . . . . . 50,925 0.01
Chemicals . . . . . . . . . . . . . . 11,857,583 1.77
Computers & Software . . . . . . . . 3,592,948 0.54
Conglomerates . . . . . . . . . . . . 15,263,158 2.28
Construction Equipment . . . . . . . 573,175 0.09
Consumer Products & Services . . . . 7,052,086 1.05
Containers . . . . . . . . . . . . . 612,850 0.09
Electrical Equipment . . . . . . . . 3,371,375 0.50
Electronics . . . . . . . . . . . . . 11,669,796 1.74
Energy . . . . . . . . . . . . . . . 3,169,176 0.47
Engineering . . . . . . . . . . . . . 354,200 0.05
Environmental . . . . . . . . . . . . 232,912 0.03
Finance . . . . . . . . . . . . . . . 2,348,122 0.35
Food & Beverages . . . . . . . . . . 15,541,357 2.32
Forest & Paper Products . . . . . . . 3,077,086 0.46
Homebuilders . . . . . . . . . . . . 1,982,678 0.30
Hospital & Healthcare . . . . . . . . 9,602,862 1.44
Household Products . . . . . . . . . 3,464,575 0.52
Insurance . . . . . . . . . . . . . . 9,814,598 1.47
Investment Banking & Brokerage . . . 2,733,700 0.41
Leisure & Entertainment . . . . . . . 654,021 0.10
Machinery & Equipment . . . . . . . . 5,715,816 0.85
Manufacturing . . . . . . . . . . . . 1,955,595 0.29
Metals & Mining . . . . . . . . . . . 8,711,375 1.30
Natural Gas . . . . . . . . . . . . . 484,250 0.07
Newspapers & Publishing . . . . . . . 4,205,632 0.63
Office Automation & Equipment . . . . 493,200 0.07
Oil & Gas . . . . . . . . . . . . . . 27,465,717 4.11
Pharmaceuticals . . . . . . . . . . . 8,337,152 1.25
Photographic Products . . . . . . . . 2,188,026 0.33
Railroads . . . . . . . . . . . . . . 4,257,469 0.64
Real Estate . . . . . . . . . . . . . 3,814,487 0.57
Restaurants . . . . . . . . . . . . . 1,780,800 0.27
Retail Trade . . . . . . . . . . . . 12,208,895 1.83
Savings & Loan Associations . . . . . 1,381,200 0.21
Telecommunications . . . . . . . . . 17,493,445 2.62
Textiles . . . . . . . . . . . . . . 1,255,637 0.19
Tobacco . . . . . . . . . . . . . . . 2,853,150 0.43
Tourism . . . . . . . . . . . . . . . 906,158 0.14
Transportation . . . . . . . . . . . 1,022,898 0.15
Utilities . . . . . . . . . . . . . . 23,404,934 3.50
Wholesale Distributors . . . . . . . 2,932,335 0.44
------------ -----
$295,232,419 44.16%
</TABLE> ============ =====
See notes to financial statements.
30
<PAGE> 33
GOVERNMENT SECURITIES SERIES
Statement of Net Assets as of December 31, 1995
<TABLE>
<CAPTION>
Principal Value
Amount (Note 2)
- -----------------------------------------------------------------------------
<S> <C> <C>
UNITED STATES GOVERNMENT & AGENCY
OBLIGATIONS: 81.79%
OVER ONE YEAR: 73.74%
FEDERAL HOME LOAN MORTGAGE CORP.,
MODIFIED MTGE. PASS-THROUGH
SECURITIES: 0.71%
10.50%, 1/1/2001 . . . . . . . . $ 31,848 $ 33,522
10.50%, 6/1/2011 . . . . . . . . 137,930 151,335
12.00%, 4/1/2014 . . . . . . . . 29,213 32,819
11.50%, 10/1/2015 . . . . . . . 92,639 103,321
12.00%, 11/1/2015 . . . . . . . 112,149 125,992
-----------
446,989
-----------
FEDERAL NATIONAL MORTGAGE ASSN.,
MODIFIED MTGE. PASS-THROUGH
SECURITIES: 0.14%
12.50%, 10/01/2014 . . . . . . . 76,323 87,056
-----------
FEDERAL NATIONAL MORTGAGE ASSN.: 6.75%
Deb., 8.25%, 12/18/2000 . . . . 950,000 1,057,325
Notes, 6.95%, 9/10/2002 . . . . 1,100,000 1,114,219
Notes, 6.38%, 6/25/2003 . . . . 2,000,000 2,015,330
-----------
4,186,874
-----------
GOVERNMENT NATIONAL MORTGAGE ASSN.,
MODIFIED MTGE. PASS-THROUGH
SECURITIES: 0.33%
12.50%, 11/20/2013 . . . . . . . 48,239 55,068
12.00%, 9/15/2015 . . . . . . . 104,862 121,018
8.00%, 8/15/2022 . . . . . . . . 24,774 25,827
-----------
201,913
-----------
PRIVATE EXPORT FUNDING CORP.: 1.76%
7.90%, 3/31/2000 . . . . . . . . 1,000,000 1,090,088
-----------
UNITED STATES TREASURY BONDS: 29.46%
10.75%, 2/15/2003 . . . . . . . 1,000,000 1,305,311
7.25%, 5/15/2004 . . . . . . . . 1,036,000 1,152,872
12.00%, 8/15/2013 . . . . . . . 1,025,000 1,582,344
8.125%, 8/15/2019 . . . . . . . 3,000,000 3,772,500
7.625%, 11/15/2022 . . . . . . . 1,145,000 1,383,303
6.25%, 8/15/2023 . . . . . . . . 1,478,000 1,519,569
7.50%, 11/15/2024 . . . . . . . 1,500,000 1,802,342
7.625%, 2/15/2025 . . . . . . . 4,700,000 5,744,274
-----------
18,262,515
-----------
UNITED STATES TREASURY NOTES: 34.59%
6.125%, 7/31/2000 . . . . . . . 11,000,000 11,330,000
6.375%, 8/15/2002 . . . . . . . 1,200,000 1,261,123
6.50%, 5/15/2005 . . . . . . . . 8,300,000 8,847,269
-----------
21,438,392
-----------
TOTAL OVER ONE YEAR
(Cost $43,454,639) . . . . . . . . . . . . . . . . . . . . 45,713,827
-----------
LESS THAN ONE YEAR: 8.05%
FEDERAL FARM CREDIT BANK, DISCOUNT
NOTES: 8.05%
5.66%, 1/16/96 . . . . . . . . . 3,000,000 2,992,925
5.48%, 1/19/96 . . . . . . . . . 2,000,000 1,994,520
-----------
TOTAL LESS THAN ONE YEAR
(Cost $4,987,445) . . . . . . . . . . . . . . . . . . . . 4,987,445
-----------
TOTAL UNITED STATES GOVERNMENT & AGENCY OBLIGATIONS
(Cost $48,442,084) . . . . . . . . . . . . . . . . . . . . 50,701,272
-----------
REPURCHASE AGREEMENTS: 17.17%
With Morgan Stanley & Co., Inc.
(dated 12/29/95), 5.95%, due 1/2/96
(Repurchase proceeds $4,644,068); collater-
alized by: $4,949,000 Federal National
Mortgage Assn., 8.00%, 12/01/2025 (Market
value $5,153,009) . . . . . . . . 4,641,000 4,641,000
With Prudential Securities Inc. (dated
12/29/95), 5.95%, due 1/2/96 (Repurchase
proceeds $6,003,967); collateralized by:
$6,027,011 Government National Mortgage
Assn., 5.50%-6.75%, 3/20/2016-12/20/2025
(Market value $6,123,133) . . . . 6,000,000 6,000,000
-----------
TOTAL REPURCHASE AGREEMENTS
(Cost $10,641,000) . . . . . . . . . . . . . . . . . . . . . 10,641,000
-----------
TOTAL INVESTMENTS
(Cost $59,083,084) . . . . . . . 98.96% 61,342,272
Other Assets . . . . . . . . . . . . 1.48 914,561
------ -----------
Total Assets . . . . . . . . . . . 100.44% 62,256,833
Total Liabilities ote 7) . . . . . (0.44) (271,225)
------ -----------
NET ASSETS (Note 9) . . . . . . . . . 100.00% $61,985,608
====== ===========
WEIGHTED AVERAGE DURATION . . . . . . . . . . . . . . . . . . . 5.4 YEARS
===
CLASS A SHARES
Net asset value (NAV) and redemption price per share
($42,207,159/4,063,191 shares) . . . . . . . . . . . . . . . $10.39
======
Maximum public offering price per share- NAV/(1-maximum
sales charge) ($10.39/.9525) . . . . . . . . . . . . . . . $10.91
======
CLASS C SHARES
Net asset value and offering price per share
($19,778,449/1,905,062 shares) . . . . . . . . . . . . . . . $10.38
======
Redemption price per share . . . . . . . . . . . . . . . . . . *
======
- -----------------------------------------------------------------------------
</TABLE>
*Varies by length of time shares are held. (Note 3b)
For Federal income tax purposes, the tax basis of investments owned at December
31, 1995 was $ 59,083,084 and unrealized appreciation on investments
consisted of:
<TABLE>
<S> <C>
Gross unrealized appreciation . . . . . . . . . . . . . . . $2,302,295
Gross unrealized depreciation . . . . . . . . . . . . . . . (43,107)
----------
Net unrealized appreciation . . . . . . . . . . . . . . . . $2,259,188
==========
</TABLE>
See notes to financial statements.
31
<PAGE> 34
ZWEIG CASH FUND
Statement of Net Assets as of December 31, 1995
<TABLE>
<CAPTION>
Principal Value
Amount (Note 2)
- -----------------------------------------------------------------------------
<S> <C> <C>
UNITED STATES GOVERNMENT AGENCY OBLIGATIONS: 75.51%
FEDERAL FARM CREDIT BANK, DISCOUNT NOTES: 28.07%
5.66%, 1/16/96 . . . . . . . . . $3,000,000 $ 2,992,925
5.56%, 1/23/96 . . . . . . . . . 2,000,000 1,993,204
5.53%, 1/25/96 . . . . . . . . . 2,000,000 1,992,627
5.54%, 2/9/96 . . . . . . . . . . 3,000,000 2,981,995
5.42%, 2/22/96 . . . . . . . . . 4,000,000 3,968,684
5.37%, 4/15/96 . . . . . . . . . 2,000,000 1,968,675
-----------
15,898,110
-----------
FEDERAL HOME LOAN BANK:
DISCOUNT NOTES: 3.50%
5.54%, 2/27/96 . . . . . . . . . 2,000,000 1,982,457
-----------
FEDERAL HOME LOAN MORTGAGE CORP.,
DISCOUNT NOTES: 14.02%
5.55%, 2/7/96 . . . . . . . . . . 5,000,000 4,971,479
5.505%, 3/4/96 . . . . . . . . . 3,000,000 2,971,099
-----------
7,942,578
-----------
FEDERAL NATIONAL MORTGAGE ASSN.,
DISCOUNT NOTES: 29.92%
5.59%, 1/5/96 . . . . . . . . . . 2,000,000 1,998,758
5.61%, 1/5/96 . . . . . . . . . . 4,000,000 3,997,507
5.58%, 1/19/96 . . . . . . . . . 3,000,000 2,991,630
5.57%, 1/26/96 . . . . . . . . . 2,000,000 1,992,264
5.53%, 1/30/96 . . . . . . . . . 2,000,000 1,991,091
5.56%, 2/2/96 . . . . . . . . . . 2,000,000 1,990,115
5.58%, 2/22/96 . . . . . . . . . 2,000,000 1,983,880
-----------
16,945,245
-----------
TOTAL UNITED STATES GOVERNMENT AGENCY OBLIGATIONS
(Cost $42,768,390) . . . . . . . . . . . . . . . . . . . . . 42,768,390
-----------
REPURCHASE AGREEMENTS: 24.94%
With Morgan Stanley & Co., Inc. (dated
12/29/95), 5.95%, due 1/2/96 (Repurchase
proceeds $6,003,967); collateralized by:
$6,873,534 various United States
Government Agency Obligations,
5.50%-7.755%, 12/1/2000-3/1/2028
(Market value $6,179,097) . . . . . 6,000,000 6,000,000
With Prudential Securities, Inc. (dated
12/29/95), 5.95%, due 1/2/96 (Repurchase
proceeds $8,130,372); collateralized by:
$8,156,768 Government National Mtge. Assn.,
5.50%-7.625%, 12/20/2023-10/15/2030
(Market value $8,308,480) . . . . . 8,125,000 8,125,000
-----------
TOTAL REPURCHASE AGREEMENTS
(Cost $14,125,000) . . . . . . . . . . . . . . . . . . . . . 14,125,000
-----------
TOTAL INVESTMENTS (Cost $56,893,390) 100.45% 56,893,390
Other Assets . . . . . . . . . . . . 0.05 25,714
------ -----------
Total Assets . . . . . . . . . . . 100.50% 56,919,104
Total Liabilities (Note 7) . . . . (0.50) (285,515)
------ -----------
NET ASSETS (Note 9) . . . . . . . . . 100.00% $56,633,589
====== ===========
Net asset value, offering and redemption
price per share (3,660,628 Class A shares,
4,458,389 Class C shares and 48,514,572
Class M shares) . . . . . . . . . . . . . . . . . . . . . . . $1.00
=====
Weighted average days to maturity . . . . . . . . . . . . . . . 30
=====
</TABLE>
See notes to financial statements.
32
<PAGE> 35
ZWEIG SERIES TRUST
Statement of Operations for the Year Ended
December 31, 1995 (In thousands)
<TABLE>
<CAPTION>
Zweig Zweig Zweig
Strategy Appreciation Managed
Fund Fund Assets
--------- ------------ --------
<S> <C> <C> <C>
INVESTMENT INCOME:
Income:
Dividends* . . . . . . . . . . . . . . . . . . . . . . . . $ 10,793 $ 6,288 $ 5,416
Interest . . . . . . . . . . . . . . . . . . . . . . . . . 17,768 4,996 31,473**
- ----------------------------------------------------------------------------------------------------------------
Total income . . . . . . . . . . . . . . . . . . . . . . 28,561 11,284 36,889
- ----------------------------------------------------------------------------------------------------------------
Expenses: (Note 2)
Advisory fees (Note 3) . . . . . . . . . . . . . . . . . . 6,702 4,141 6,994
Distribution fees, Class A (Note 3) . . . . . . . . . . . . 1,466 746 454
Distribution fees, Class C (Note 3) . . . . . . . . . . . . 4,050 1,655 5,482
Distribution fees, Class M (Note 3) . . . . . . . . . . . . -- -- --
Transfer agent fees . . . . . . . . . . . . . . . . . . . . 1,152 649 804
Amortization of organization expenses . . . . . . . . . . . -- 149 155
Custodian fees . . . . . . . . . . . . . . . . . . . . . . 120 96 465
Insurance . . . . . . . . . . . . . . . . . . . . . . . . . 48 19 31
Portfolio accounting fees . . . . . . . . . . . . . . . . . 209 177 209
Professional fees . . . . . . . . . . . . . . . . . . . . . 85 48 70
Registration fees . . . . . . . . . . . . . . . . . . . . . 40 40 51
Reports to shareholders . . . . . . . . . . . . . . . . . . 259 141 185
Trustees' fees . . . . . . . . . . . . . . . . . . . . . . 20 12 16
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . 41 22 30
- ----------------------------------------------------------------------------------------------------------------
Total expenses . . . . . . . . . . . . . . . . . . . . . 14,192 7,895 14,946
Less: Expenses reimbursed by investment adviser (Note 3) . -- -- --
- ----------------------------------------------------------------------------------------------------------------
Net expenses . . . . . . . . . . . . . . . . . . . . . . 14,192 7,895 14,946
- ----------------------------------------------------------------------------------------------------------------
Net investment income . . . . . . . . . . . . . . . . . . . . . 14,369 3,389 21,943
- ----------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS
AND FOREIGN CURRENCY:
Net realized gains (losses):
Security transactions . . . . . . . . . . . . . . . . . . . 97,587 37,164 37,132
Option transactions . . . . . . . . . . . . . . . . . . . . (848) (418) 2,412
Futures transactions . . . . . . . . . . . . . . . . . . . (8,360) (19,554) 2,194
Currency transactions . . . . . . . . . . . . . . . . . . . -- -- 7,929
- ----------------------------------------------------------------------------------------------------------------
Net realized gains (losses) . . . . . . . . . . . . . . . 88,379 17,192 49,667
- ----------------------------------------------------------------------------------------------------------------
Increase in unrealized appreciation of investments
and foreign currency . . . . . . . . . . . . . . . . . . . 81,614 68,145*** 30,325
- ----------------------------------------------------------------------------------------------------------------
Net realized and unrealized gains (losses) on investments
and foreign currency 169,993 85,337 79,992
- ----------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations . . . . . $ 184,362 $ 88,726 $101,935
================================================================================================================
* Net of taxes withheld on foreign dividends. . . . . . . . $ 87 $ 42 $ 452
========================================
<CAPTION>
Government Zweig
Securities Cash
Series Fund
---------- -----
<S> <C> <C>
INVESTMENT INCOME:
Income:
Dividends* . . . . . . . . . . . . . . . . . . . . . . . . $ -- $ --
Interest . . . . . . . . . . . . . . . . . . . . . . . . . 4,248 4,185
- --------------------------------------------------------------------------------------------------------------
Total income . . . . . . . . . . . . . . . . . . . . . 4,248 4,185
- --------------------------------------------------------------------------------------------------------------
Expenses: (Note 2)
Advisory fees (Note 3) . . . . . . . . . . . . . . . . . . 394 359
Distribution fees, Class A (Note 3) . . . . . . . . . . . . 134 12
Distribution fees, Class C (Note 3) . . . . . . . . . . . . 156 15
Distribution fees, Class M (Note 3) . . . . . . . . . . . . -- 45
Transfer agent fees . . . . . . . . . . . . . . . . . . . . 101 35
Amortization of organization expenses . . . . . . . . . . . -- --
Custodian fees . . . . . . . . . . . . . . . . . . . . . . 22 23
Insurance . . . . . . . . . . . . . . . . . . . . . . . . . 3 3
Portfolio accounting fees . . . . . . . . . . . . . . . . . 47 8
Professional fees . . . . . . . . . . . . . . . . . . . . . 9 7
Registration fees . . . . . . . . . . . . . . . . . . . . . 22 38
Reports to shareholders . . . . . . . . . . . . . . . . . . 18 16
Trustees' fees . . . . . . . . . . . . . . . . . . . . . . 5 5
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . 8 9
- --------------------------------------------------------------------------------------------------------------
Total expenses . . . . . . . . . . . . . . . . . . . . 919 575
Less: Expenses reimbursed by investment adviser (Note 3) . -- (95)
- --------------------------------------------------------------------------------------------------------------
Net expenses . . . . . . . . . . . . . . . . . . . . . 919 480
- --------------------------------------------------------------------------------------------------------------
Net investment income . . . . . . . . . . . . . . . . . . . . . 3,329 3,705
- --------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS
AND FOREIGN CURRENCY:
Net realized gains (losses):
Security transactions . . . . . . . . . . . . . . . . . . . 1,665 (106)
Option transactions . . . . . . . . . . . . . . . . . . . . -- --
Futures transactions . . . . . . . . . . . . . . . . . . . -- --
Currency transactions . . . . . . . . . . . . . . . . . . . -- --
- --------------------------------------------------------------------------------------------------------------
Net realized gains (losses) . . . . . . . . . . . . . 1,665 (106)
- --------------------------------------------------------------------------------------------------------------
Increase in unrealized appreciation of investments
and foreign currency . . . . . . . . . . . . . . . . . . . 3,304 --
- --------------------------------------------------------------------------------------------------------------
Net realized and unrealized gains (losses) on investments
and foreign currency 4,969 (106)
- --------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations . . . . . $8,298 $3,599
==============================================================================================================
* Net of taxes withheld on foreign dividends. . . . . . . . -- --
=============================
</TABLE>
** Net of taxes withheld on foreign interest of $409.
*** Excludes net unrealized appreciation on investments of $1,746 acquired in
the merger with Priority Selection List Series.(Note 5)
See notes to financial statements.
33
<PAGE> 36
ZWEIG SERIES TRUST
Statement of Changes in Net Assets for the Years Ended
December 31, 1995 and 1994 (In thousands)
<TABLE>
<CAPTION>
Zweig Strategy Fund Zweig Appreciation Fund
----------------------- --------------------------
1995 1994 1995 1994
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income . . . . . . . . . . . . . . . . . . . . . $ 14,369 $ 11,482 $ 3,389 $ 3,048
Net realized gains (losses) on investments and
foreign currency . . . . . . . . . . . . . . . . . . . . . . . 88,379 (8,953) 17,192 10,311
Unrealized appreciation (depreciation) of investments and
foreign currency . . . . . . . . . . . . . . . . . . . . . . . 81,614 1,536 68,145 (21,532)
- -------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations . . . . . . . . . . . . . . . . . . . . . . . . . 184,362 4,065 88,726 (8,173)
- -------------------------------------------------------------------------------------------------------------------------------
Additions to capital paid-in (Notes 3a and 8) . . . . . . . . . . . . -- 67 -- 11
- -------------------------------------------------------------------------------------------------------------------------------
Dividends to shareholders from net investment income:
Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . (13,218) (6,766) (5,429) (962)
Class C . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,393) (2,373) (1,215) --
Class M . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- -- -- --
Distributions to shareholders from net realized gains
on investments:
Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . (20,001) (3,243) (8,373) (7,097)
Class C . . . . . . . . . . . . . . . . . . . . . . . . . . . . (18,613) (1,505) (6,032) (4,677)
- -------------------------------------------------------------------------------------------------------------------------------
Total dividends and distributions to shareholders . . . . . . . . . (58,225) (13,887) (21,049) (12,736)
- -------------------------------------------------------------------------------------------------------------------------------
Capital share transactions (Note 8):
Net proceeds from sale of shares . . . . . . . . . . . . . . . . 329,295 313,689 62,439 161,190
Net proceeds from reorganization and merger
(Notes 4 and 5) . . . . . . . . . . . . . . . . . . . . . . . -- -- 57,544 --
Net asset value of shares issued to shareholders in
reinvestment of dividends and distributions . . . . . . . . . 45,624 10,855 17,132 10,678
- -------------------------------------------------------------------------------------------------------------------------------
374,919 324,544 137,115 171,868
Cost of shares redeemed . . . . . . . . . . . . . . . . . . . . . . . (144,286) (177,488) (89,795) (134,360)
- -------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets derived from capital share
transactions . . . . . . . . . . . . . . . . . . . . . . . . . 230,633 147,056 47,320 37,508
- -------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets . . . . . . . . . . . . . 356,770 137,301 114,997 16,610
NET ASSETS:
Beginning of year . . . . . . . . . . . . . . . . . . . . . . . 731,816 594,515 352,797 336,187
- -------------------------------------------------------------------------------------------------------------------------------
End of year . . . . . . . . . . . . . . . . . . . . . . . . . . $1,088,586 $ 731,816 $ 467,794 $ 352,797
===============================================================================================================================
Undistributed net investment income (loss) . . . . . . . . . . . . . $ (25) $ 2,144 $ (214) $ 3,041
===============================================================================================================================
</TABLE>
See notes to financial statements.
34
<PAGE> 37
<TABLE>
<CAPTION>
Zweig Managed Assets Government Securities Series
-------------------- ----------------------------
1995 1994 1995 1994
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income . . . . . . . . . . . . . . . . . . . . . $ 21,943 $ 15,293 $ 3,329 $ 3,793
Net realized gains (losses) on investments and
foreign currency . . . . . . . . . . . . . . . . . . . . . . . 49,667 (15,872) 1,665 (3,559)
Unrealized appreciation (depreciation) of investments and
foreign currency . . . . . . . . . . . . . . . . . . . . . . . 30,325 (25,567) 3,304 (2,764)
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations . . . . . . . . . . . . . . . . . . . . . . . . . . 101,935 (26,146) 8,298 (2,530)
- ----------------------------------------------------------------------------------------------------------------------------------
Additions to capital paid-in (Notes 3a and 8) . . . . . . . . . . . . -- -- -- 11
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends to shareholders from net investment income:
Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8,831) (3,209) (2,404) (2,742)
Class C . . . . . . . . . . . . . . . . . . . . . . . . . . . . (26,808) (8,472) (1,014) (1,055)
Class M . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- -- -- --
Distributions to shareholders from net realized gains
on investments:
Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,348) -- -- --
Class C . . . . . . . . . . . . . . . . . . . . . . . . . . . . (16,160) -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
Total dividends and distributions to shareholders . . . . . . . . . (56,147) (11,681) (3,418) (3,797)
- ----------------------------------------------------------------------------------------------------------------------------------
Capital share transactions (Note 8):
Net proceeds from sale of shares . . . . . . . . . . . . . . . . 88,397 339,737 8,989 17,854
Net proceeds from reorganization and merger
(Notes 4 and 5) . . . . . . . . . . . . . . . . . . . . . . . -- -- -- --
Net asset value of shares issued to shareholders in
reinvestment of dividends and distributions . . . . . . . . . 40,755 8,390 1,943 2,196
- ----------------------------------------------------------------------------------------------------------------------------------
129,152 348,127 10,932 20,050
Cost of shares redeemed . . . . . . . . . . . . . . . . . . . . . . . (231,550) (135,856) (24,048) (25,020)
- ----------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets derived from capital share
transactions . . . . . . . . . . . . . . . . . . . . . . . . . (102,398) 212,271 (13,116) (4,970)
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets . . . . . . . . . . . . . (56,610) 174,444 (8,236) (11,286)
NET ASSETS:
Beginning of year . . . . . . . . . . . . . . . . . . . . . . . 725,152 550,708 70,222 81,508
- ----------------------------------------------------------------------------------------------------------------------------------
End of year . . . . . . . . . . . . . . . . . . . . . . . . . . $ 668,542 $ 725,152 $ 61,986 $ 70,222
==================================================================================================================================
Undistributed net investment income (loss) . . . . . . . . . . . . . $ 1,508 $ 4,465 $ -- $ (70)
==================================================================================================================================
<CAPTION>
Zweig Cash Fund
-------------------------
1995 1994
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income . . . . . . . . . . . . . . . . . . . . . $ 3,705 $ 3,495
Net realized gains (losses) on investments and
foreign currency . . . . . . . . . . . . . . . . . . . . . . . (106) (415)
Unrealized appreciation (depreciation) of investments and
foreign currency . . . . . . . . . . . . . . . . . . . . . . . -- --
- -----------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations . . . . . . . . . . . . . . . . . . . . . . . . . 3,599 3,080
- -----------------------------------------------------------------------------------------------------
Additions to capital paid-in (Notes 3a and 8) . . . . . . . . . . . . 106 415
- -----------------------------------------------------------------------------------------------------
Dividends to shareholders from net investment income:
Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . (199) (245)
Class C . . . . . . . . . . . . . . . . . . . . . . . . . . . . (250) (96)
Class M . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,256) (3,154)
Distributions to shareholders from net realized gains
on investments:
Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- --
Class C . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- --
- -----------------------------------------------------------------------------------------------------
Total dividends and distributions to shareholders . . . . . . . . . (3,705) (3,495)
- -----------------------------------------------------------------------------------------------------
Capital share transactions (Note 8):
Net proceeds from sale of shares . . . . . . . . . . . . . . . . 284,593 595,278
Net proceeds from reorganization and merger
(Notes 4 and 5) . . . . . . . . . . . . . . . . . . . . . . . -- 13,504
Net asset value of shares issued to shareholders in
reinvestment of dividends and distributions . . . . . . . . . 2,031 1,421
- -----------------------------------------------------------------------------------------------------
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 286,624 610,203
Cost of shares redeemed . . . . . . . . . . . . . . . . . . . . . . . (317,482) (615,182)
- -----------------------------------------------------------------------------------------------------
Increase (decrease) in net assets derived from capital share
transactions . . . . . . . . . . . . . . . . . . . . . . . . . (30,858) (4,979)
- -----------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets . . . . . . . . . . . . . (30,858) (4,979)
NET ASSETS:
Beginning of year . . . . . . . . . . . . . . . . . . . . . . . 87,492 92,471
- -----------------------------------------------------------------------------------------------------
End of year . . . . . . . . . . . . . . . . . . . . . . . . . . $ 56,634 $ 87,492
=====================================================================================================
Undistributed net investment income (loss) . . . . . . . . . . . . . $ -- $ --
=====================================================================================================
</TABLE>
35
<PAGE> 38
NOTES TO FINANCIAL STATEMENTS
December 31, 1995
NOTE 1--ORGANIZATION
Zweig Series Trust (the "Trust"), a Massachusetts business trust, is registered
under the Investment Company Act of 1940 as a diversified, open-end management
investment company. The Trust presently consists of five separate investment
portfolios ("Series"): Zweig Strategy Fund, Zweig Appreciation Fund, Zweig
Managed Assets, Government Securities Series and Zweig Cash Fund. Each Series
has distinct investment objectives and policies. A shareholder's interest is
limited to the Series in which she or he owns shares. Each Series offers both
Class A and Class C shares and Zweig Cash Fund also offers Class M shares. All
classes of shares have identical rights to earnings, assets and voting
privileges, except that each class has its own distribution and/or service
plan, and has exclusive voting rights with respect to matters affecting only
that class. On May 1, 1994, shares formerly designated Class B shares were
redesignated Class C Shares to conform with standards generally adopted in the
mutual fund industry. The offering of a new class of Class B shares, which was
authorized by the Board of Trustees on June 22, 1995, has not yet commenced.
NOTE 2--SIGNIFICANT ACCOUNTING POLICIES
(a) General: Securities transactions are recorded on trade date.
Realized gains and losses on sales of investments are determined on the
identified cost basis for both financial reporting and income tax purposes.
Distributions to shareholders and dividend income are recorded on the
ex-dividend date, except that certain dividends from foreign securities are
recorded as soon as the Series is informed of the ex-dividend date. Interest
income is recorded on the accrual basis. Direct expenses are charged to each
class or Series and general expenses are allocated in proportion to net assets.
Organization expenses are amortized on a straight-line basis over the first 60
months of operations of a Series.
(b) Portfolio Valuation: Stocks, futures and options are valued at the
closing prices reported on recognized securities exchanges or if no sale was
reported, and for unlisted securities, at the mean between the last-reported
bid and asked prices. Bonds and other fixed-income securities are valued at
prices obtained from an established bond-pricing service when such prices are
available. Forward foreign currency contracts are valued using forward currency
exchange rates supplied by a quotation service. Securities for which market
quotations are not readily available (of which there were none at December 31,
1995) are valued at fair value as determined by the Board of Trustees.
Short-term obligations having a remaining maturity of 60 days or less are
valued at amortized cost (which approximates market value). Zweig Cash Fund
values all short-term investments using the amortized cost method pursuant to
Rule 2a-7 under the Investment Company Act of 1940.
(c) Futures Contracts and Option Accounting Principles: Initial margin
deposits on futures contracts are recorded as assets. The value of such
contracts are "marked to market" daily and changes are recognized as unrealized
gains or losses. Variation margin payments are recognized as assets or
liabilities, depending upon whether unrealized gains or losses are incurred.
When a futures contract is closed, the Series realizes a gain or loss equal to
the difference between the proceeds from (or cost of) the closing transaction
and its basis in the contract. When a Series writes an option, an amount equal
to the premium received is recorded as an asset and a corresponding liability.
The liability is subsequently "marked to market" daily. When an option written
is exercised, the proceeds of sale of the underlying security are increased by
the premium originally received and the Series realizes a gain or loss. When an
option written expires or the Series enters into a closing purchase
transaction, the liability is extinguished and the Series realizes a gain or
loss.
(d) Foreign Currency Translation: Assets and liabilities denominated
in a foreign currency are translated into U.S. dollars using exchange rates on
the valuation date. Purchases and sales of securities, expense payments and
income receipts are translated into U.S. dollars using the exchange rate on the
transaction date. The Trust does not segregate that portion of the results of
operations resulting from changes in foreign exchange rates from the portion
resulting from changes in market prices of securities held; both are included
in net realized and unrealized gains or losses.
(e) Off-Balance-Sheet Risk, Repurchase Agreements and Derivatives:
Foreign securities and forward foreign currency contracts may involve risks
relating to the level of governmental supervision and regulation of foreign
markets, and the possibility of political or economic instability. With respect
to forward foreign currency contracts and repurchase agreements, losses may
arise if the counterparty does not perform under the contract or agreement. The
Trust's investment manager monitors the requirement that the market value of
the securities used to collateralize a repurchase agreement exceed the dollar
amount of the counterparty's obligation to repurchase. A Series' use of futures
contracts, forward foreign currency contracts and options involves, to varying
degrees, elements of market risk in excess of the amount recognized in the
statement of net assets. These derivative financial instruments ("derivatives")
are used to adjust the risk and return characteristics of a Series' portfolio.
Derivatives are not used for the purpose of leverage. The objective in buying
or selling a derivative instrument is to increase or decrease a Series'
exposure to changing security prices, interest rates or currency exchange
rates. If the Manager misjudges market conditions or employs a strategy that
does not correlate well with the Series' other investments, use of these
derivatives could result in a loss, regardless of the Manager's original intent
to reduce risk.
(f) Federal Income Taxes: It is the policy of each Series to continue
to comply with the requirements of the Internal Revenue Code applicable to
regulated investment companies and to distribute all of its net taxable income,
including any net realized gain on investments, to its shareholders; therefore,
no provision for federal income tax is required.
(g) Dividends and Distributions to Shareholders: Dividends and
distributions are declared separately for each class of shares of a Series.
Dividends from net investment income are declared and paid monthly by
Government Securities Series, quarterly by Zweig Strategy Fund and Zweig
Managed Assets and at least annually by Zweig Appreciation Fund. Any net
realized capital gain distributions are declared and paid annually, except that
amounts attributable to net short-term capital gains may be included with
dividends from net investment income. Zweig Cash Fund declares daily dividends
of all net investment income, plus or minus realized gains or losses, and pays
dividends monthly. The character of distributions made during the year from net
investment income or net realized gains may differ from their ultimate
characterization for federal income tax purposes due to differences in the
recognition of income and expense items for financial statement and federal
income tax purposes. During the year ended December 31, 1995, Zweig Managed
Assets reclassified $10,739,061 from accumulated net realized gain to
undistributed net investment income and Government Securities Series
reclassified $160,492 from current year net realized gain to undistributed net
investment income.
At October 31, 1995 (each Series' tax fiscal year-end), Government
Securities Series had capital loss carryforwards, including acquired loss
carryforwards, of $28,444,648, $13,506,401, $2,631,923, $249,274 and
36
<PAGE> 39
$7,227,155 expiring October 31, 1996, 1997, 1998, 1999 and 2001, respectively;
available to offset any net capital gains subsequently realized, subject to
certain limitations.
NOTE 3--INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS
WITH AFFILIATES
(a) INVESTMENT MANAGER: The Trust's investments are managed by
Zweig/Glaser Advisers (the "Manager"). The Manager's investment advisory fee is
based on the average daily net assets of each Series at the following annual
rates: Zweig Strategy Fund--.75%; Zweig Appreciation Fund--1.00%; Zweig Managed
Assets--1.00%; Government Securities Series--.60%; and Zweig Cash Fund--.50%.
The fee is accrued daily and paid monthly. Investment advisory fees for the
year ended December 31, 1995 aggregated $18,590,172.
The Manager has undertaken voluntarily to limit the expenses of Zweig
Cash Fund (exclusive of taxes, interest, brokerage commissions, the
distribution fees described below and extraordinary expenses) to .35% of its
average daily net assets. During the year ended December 31, 1995, the
Manager's reimbursements to Zweig Cash Fund aggregated $94,925 under this and
prior voluntary expense limitations. The Manager reserves the right to
discontinue the expense limitation at any time after April 30, 1996. In March,
1994 and November, 1995, the Manager contributed $415,283 and $106,250,
respectively, to Zweig Cash Fund to offset losses incurred by the Fund on sales
of certain variable rate reset notes.
(b) PRINCIPAL DISTRIBUTOR: Zweig Securities Corp. (the "Distributor")
serves as principal distributor of shares of the Trust. The Trust's Class A
Shares (excluding Zweig Cash Fund shares) are sold with an initial sales
charge. Class C Shares are sold subject to a contingent deferred sales charge,
and Class M shares of Zweig Cash Fund are sold without a sales charge. The
Distributor's share of sales charges paid by the purchasers of Class A shares
was $800,912 and its share of contingent deferred sales charges paid by the
redeemers of Class C shares was $305,671 during the year ended December 31,
1995.
Pursuant to a Rule 12b-1 plan of distribution, the Trust pays the
Distributor a combined service and distribution fee equal to an annual rate of
.30% of average daily net assets for each Series of Class A shares and 1.00%
for Class C shares of Zweig Strategy Fund, Zweig Appreciation Fund and Zweig
Managed Assets, .75% for Class C shares of Government Securities Series and
.30% for Class C shares of Zweig Cash Fund, respectively. The Distributor's
aggregate fees under this plan for the year ended December 31, 1995, amounted
to $2,812,095 for Class A shares and $11,357,616 for Class C shares. A separate
Rule 12b-1 distribution sharing plan for Class M shares of Zweig Cash Fund
provides that the Manager may enter into service agreements with various
service organizations for distribution, promotion, administration and/or
servicing investors in Class M shares. The service organizations are paid
equally by the Class M shares and the Manager. During the year ended December
31, 1995, the Class M shares paid $44,714 under this plan.
During the year ended December 31, 1995, the Trust paid Zweig
Securities Corp. brokerage commissions of $468,501 in connection with portfolio
transactions effected by it.
One Trustee and all of the officers of the Trust are also officers of
the Manager and/or the Distributor.
NOTE 4--REORGANIZATION
On May 1, 1994, Zweig Cash Fund, a newly formed Series of Zweig Series Trust,
exchanged its Class A and Class C Shares for the net assets of the Money Market
Series of the Trust and exchanged its Class M Shares for the net assets of
Zweig Cash Fund Inc. The Class A and Class C shares of the newly formed Series
were distributed to shareholders of the Money Market Series and the Class M
shares were distributed to the shareholders of Zweig Cash Fund Inc. in
liquidation of those entities.
===============================================================================
NOTE 5--MERGER
On April 4, 1995, Zweig Appreciation Fund ("Appreciation") acquired all of the
net assets of Zweig Series Trust Priority Selection List Series ("Priority")
pursuant to a plan of reorganization approved by the shareholders of Priority
on March 28, 1995. The acquisition was accomplished by a tax-free exchange of
the Appreciation shares for all the net assets of Priority and has been
accounted for as a pooling of interests without restatement for financial
reporting purposes. The selected financial information and shares outstanding
for the Funds immediately before and after the acquisition were as follows:
<TABLE>
<CAPTION>
Net Asset
Value Shares Exchange Shares
Net Assets Per Share Outstanding* Ratio Outstanding**
------------ --------- ------------ ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Priority Class A . . . . $ 41,711,769 $12.47 3,344,959 x .90442368 = 3,025,260
Appreciation Class A . . 207,349,503 13.79 15,038,440 15,038,440
------------ ------ ---------- ----------
Combined . . . . . . . . $249,061,272 $13.79 18,383,399 18,063,700
------------ ------ ---------- ----------
Priority Class C . . . . $ 15,831,830 $12.44 1,272,171 x .90935221 = 1,156,852
Appreciation Class C . . 139,760,128 13.69 10,212,445 10,212,445
------------ ------ ---------- ----------
Combined . . . . . . . . $155,591,958 $13.69 11,484,616 11,369,297
------------ ------ ---------- ----------
</TABLE>
The net assets of Priority included unrealized appreciation on investments
of $1,745,945 and accumulated net realized losses of $1,314,728.
* Before acquisition.
** After acquisition.
37
<PAGE> 40
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 6--PURCHASES AND SALES OF SECURITIES AND FORWARD CURRENCY CONTRACTS
During the year ended December 31, 1995, purchase and sale transactions of the
Trust, excluding repurchase agreements, short-term obligations, options written
and futures contracts, were:
<TABLE>
<CAPTION>
Zweig Zweig Zweig Government
Strategy Appreciation Managed Securities
Fund Fund Assets Series
------------ ------------ -------------- -----------
<S> <C> <C> <C> <C>
Securities purchases . . . . . . . . . . . . $947,063,095 $274,089,760 $1,311,356,109 $79,131,855
Securities sales . . . . . . . . . . . . . . 556,857,750 223,532,713 1,128,826,624 66,055,661
</TABLE>
Transactions in options written during the year ended December 31, 1995, were:
<TABLE>
<CAPTION>
Zweig Strategy Fund Zweig Appreciation Fund
----------------------------------- ---------------------------------
Number of Contracts Premiums Number of Contracts Premiums
------------------- -------- ------------------- --------
<S> <C> <C> <C> <C>
Options outstanding at December 31,1994 . . . 333 $ 613,526 164 $ 302,157
Closing purchase transactions . . . . . . . . (333) (613,526) (164) (302,157)
---- --------- ---- ---------
Options outstanding at December 31,1995 . . . -- $ -- -- $ --
==== ========= ==== =========
</TABLE>
Forward currency contracts outstanding at December 31, 1995, for Zweig Managed
Assets were:
<TABLE>
<CAPTION>
Net Unrealized
Settlement Appreciation
Contracts to Deliver In Exchange For Date Value (Depreciation)
--------------------- --------------- -------- ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Sales . . . . Australian Dollar . . . A$ 56,700,000 $ 41,865,863 2/1/96 $ (42,102,472) $ (236,609)
Finnish Markka . . . . Fim 58,400,000 13,411,105 2/1/96 (13,471,770) (60,665)
French Franc . . . . . ff 210,000,000 42,464,562 2/1/96 (42,975,030) (510,468)
German Deutsche Mark . DM 67,000,000 46,480,974 2/1/96 (46,901,340) (420,366)
Italian Lira . . . . . Lira 11,000,000,000 6,817,055 2/1/96 (6,897,000) (79,945)
Japanese Yen . . . . . yen 2,760,000,000 27,434,570 2/1/96 (26,890,680) 543,890
Spanish Peseta . . . . Pta 2,983,000,000 24,083,679 2/1/96 (24,499,379) (415,700)
Swedish Krona . . . . . SKr 98,000,000 14,534,668 2/1/96 (14,744,688) (210,020)
Swiss Franc . . . . . . Sf 7,200,000 6,220,840 2/1/96 (6,281,431) (60,591)
U.K. Pound Sterling . . pound
sterling 33,000,000 50,754,000 2/1/96 (51,191,349) (437,349)
------------------- ------------- -----------
$274,067,316 $(275,955,139) $(1,887,823)
=================== ============= ===========
Purchases . . German Deutsche Mark . $ 46,604,643 DM 67,000,000 2/1/96 $46,901,340 $296,697
Spanish Peseta . . . . 24,388,848 Pta 2,983,000,000 2/1/96 24,499,379 110,531
U.K. Pound pound
Sterling . . . . . . . 4,625,130 sterling 3,000,000 2/1/96 4,653,759 28,629
--------------- ------------- ------------
$ 75,618,621 $ 76,054,478 $ 435,857
=============== ============= ============
</TABLE>
NOTE 7--LIABILITIES--DECEMBER 31, 1995 (IN THOUSANDS)
<TABLE>
<CAPTION>
Zweig Zweig Zweig Government Zweig
Strategy Appreciation Managed Securities Cash
Fund Fund Assets Series Fund
---- ---- ------ ------ ----
<S> <C> <C> <C> <C> <C>
Advisory Fee . . . . . . . . . . . . . . $ 89 $ 51 $ 72 $ 4 $ 3
Distribution and Service Fees . . . . . . 585 233 482 23 3
Capital Shares Redeemed . . . . . . . . . 1,013 511 779 205 --
Dividends . . . . . . . . . . . . . . . . -- -- -- -- 266
Securities Purchased . . . . . . . . . . 53,959 1,146 7,787 -- --
Accrued Expenses . . . . . . . . . . . . 413 249 802 39 14
-------- -------- -------- ------ -----
Total Liabilities . . . . . . . . . . . $ 56,059 $ 2,190 $ 9,922 $ 271 $ 286
======== ======== ======== ====== =====
</TABLE>
38
<PAGE> 41
NOTE 8--CAPITAL SHARES
The Trust has unlimited authorized shares of beneficial interest ($0.10 par
value), divided into Series and issued in classes (see note 1). Capital share
transactions for the years ended December 31, 1995 and 1994 are set forth
below.
On June 8, 1993, Zweig Strategy Fund, Zweig Appreciation Fund and Government
Securities Series were all beneficiaries of a settlement with the Trust's
former distributor. The proceeds from the settlement received in 1994 were
treated as additions to capital paid-in.
<TABLE>
<CAPTION>
Class A Class C
--------------------------- -----------------------------
1995 1994 1995 1994
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
ZWEIG STRATEGY FUND
Sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,877,181 12,364,078 15,068,149 12,642,547
Issued in reinvestment of dividends and distributions . . . . . . 1,847,851 628,409 1,322,287 250,204
Redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,617,447) (11,060,548) (4,816,427) (3,119,586)
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase . . . . . . . . . . . . . . . . . . . . . . . . . 4,107,585 1,931,939 11,574,009 9,773,165
===================================================================================================================================
ZWEIG APPRECIATION FUND
Sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,345,078 7,174,228 2,780,621 4,144,686
Issued in reinvestment of dividends and distributions . . . . . . 755,791 524,760 352,626 277,178
Issued in merger of Priority Selection List Series (Note 5) . . . 3,025,260 -- 1,156,852 --
Redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,757,691) (7,997,504) (2,393,312) (1,454,951)
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) . . . . . . . . . . . . . . . . . . . . 1,368,438 (298,516) 1,896,787 2,966,913
===================================================================================================================================
ZWEIG MANAGED ASSETS
Sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,612,962 5,744,271 5,502,115 22,216,871
Issued in reinvestment of dividends and distributions . . . . . . 874,559 219,494 2,398,874 484,734
Redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,317,073) (2,648,985) (14,332,281) (8,761,943)
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) . . . . . . . . . . . . . . . . . . . . (1,829,552) 3,314,780 (6,431,292) 13,939,662
===================================================================================================================================
GOVERNMENT SECURITIES SERIES
Sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 224,049 642,988 676,987 1,129,396
Issued in reinvestment of dividends . . . . . . . . . . . . . . . 136,077 159,828 60,147 61,844
Redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,242,528) (1,628,976) (1,181,786) (890,029)
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) . . . . . . . . . . . . . . . . . . . . (882,402) (826,160) (444,652) 301,211
===================================================================================================================================
ZWEIG CASH FUND (1)(2)
Sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,510,433 192,766,579 10,482,656 5,977,650
Issued in reinvestment of dividends . . . . . . . . . . . . . . . 157,598 197,578 211,361 67,653
Issued in reorganization of Money Market Series (Note 4) . . . . -- 10,892,661 -- 2,611,345
Redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . (14,310,228) (199,553,993) (11,275,296) (3,616,980)
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) . . . . . . . . . . . . . . . . . . . . (642,197) 4,302,825 (581,279) 5,039,668
===================================================================================================================================
</TABLE>
(1) For the years ended December 31, 1995 and 1994, respectively, shares of
Zweig Cash Fund Class M sold were 260,599,750 and 396,533,858; shares
issued in reinvestment of dividends were 1,661,722 and 1,155,299; and
shares redeemed were 291,896,255 and 412,010,758 for net decreases of
29,634,783 and 14,321,601 shares.
(2) Class A and Class C shares commenced operations on May 1, 1994.
NOTE 9--NET ASSETS--DECEMBER 31, 1995 (IN THOUSANDS)
<TABLE>
<CAPTION>
Zweig Zweig Zweig Government Zweig
Strategy Appreciation Managed Securities Cash
Fund Fund Assets Series Fund
---------- ------------ -------- ---------- --------
<S> <C> <C> <C> <C> <C>
Net Assets consist of:
Capital paid-in . . . . . . . . . . . . . . . . . $ 953,822 $370,165 $640,556 $110,445 $56,634
Undistributed net investment income (loss) . . . (25) (214) 1,508 -- --
Accumulated net realized gain (loss) . . . . . . 40,435 8,588 408 (50,718) --
Net unrealized appreciation of investments . . . 94,354 89,255 26,070 2,259 --
---------- -------- -------- -------- -------
$1,088,586 $467,794 $668,542 $ 61,986 $56,634
========== ======== ======== ======== =======
</TABLE>
39
<PAGE> 42
FINANCIAL HIGHLIGHTS
Selected Data for each share of capital stock outstanding throughout the years
indicated.
<TABLE>
<CAPTION>
Net Realized Distributions
Net Asset and Dividends from Net Total Net Asset
Value Net Unrealized Total from from Net Realized Dividends Value
Year Beginning Investment Gains Investment Investment Capital and End Total
Ended of Year Income (Losses) Operations Income Gains Distributions of Year Return***
- ----- --------- ---------- --------- ---------- ---------- ------------ ------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
ZWEIG STRATEGY FUND CLASS A
1995 $ 12.36 $ 0.27 $ 2.80 $ 3.07 $ (0.37) $ (0.55) $ (0.92) $ 14.51 25.12%
1994 12.52 0.24 (0.10) 0.14 (0.20) (0.10) (0.30) 12.36 1.14
1993 13.60 0.13 1.72 1.85 (0.12) (2.81) (2.93) 12.52 14.97
1992 13.03 0.17 0.80 0.97 (0.21) (0.19) (0.40) 13.60 7.61
1991 10.81 0.21 2.27 2.48 (0.26) -- (0.26) 13.03 23.34
ZWEIG STRATEGY FUND CLASS C
1995 12.35 0.16 2.82 2.98 (0.22) (0.55) (0.77) 14.56 24.26
1994 12.51 0.15 (0.10) 0.05 (0.11) (0.10) (0.21) 12.35 0.41
1993 13.61 0.05 1.71 1.76 (0.05) (2.81) (2.86) 12.51 14.18
1992(1) 12.89 0.08 0.69 0.77 (0.05) -- (0.05) 13.61 6.00
ZWEIG APPRECIATION FUND CLASS A
1995 13.54 0.16 3.05 3.21 (0.33) (0.51) (0.84) 15.91 24.00
1994 14.33 0.16 (0.43) (0.27) (0.06) (0.46) (0.52) 13.54 (1.83)
1993 13.10 0.07 1.83 1.90 (0.06) (0.61) (0.67) 14.33 14.65
1992 12.03 0.06 1.07 1.13 (0.03) (0.03) (0.06) 13.10 9.52
1991(2) 11.34 0.03 0.66 0.69 -- -- -- 12.03 6.08
ZWEIG APPRECIATION FUND CLASS C
1995 13.36 0.06 3.03 3.09 (0.11) (0.51) (0.62) 15.83 23.20
1994 14.19 0.06 (0.43) (0.37) -- (0.46) (0.46) 13.36 (2.55)
1993 13.01 (0.01) 1.80 1.79 -- (0.61) (0.61) 14.19 13.84
1992(1) 12.33 (0.02) 0.70 0.68 -- -- -- 13.01 5.52
ZWEIG MANAGED ASSETS CLASS A
1995 11.76 0.47 1.40 1.87 (1.03) (0.12) (1.15) 12.48 16.26
1994 12.38 0.33 (0.69) (0.36) (0.26) -- (0.26) 11.76 (2.93)
1993(3) 11.34 0.22 1.13 1.35 (0.14) (0.17) (0.31) 12.38 11.98
ZWEIG MANAGED ASSETS CLASS C
1995 11.73 0.38 1.40 1.78 (0.90) (0.12) (1.02) 12.49 15.44
1994 12.36 0.23 (0.68) (0.45) (0.18) -- (0.18) 11.73 (3.66)
1993(3) 11.34 0.15 1.13 1.28 (0.09) (0.17) (0.26) 12.36 11.34
GOVERNMENT SECURITIES SERIES CLASS A
1995+ 9.63 0.52 0.77 1.29 (0.53) -- (0.53) 10.39 13.84
1994 10.43 0.50 (0.79) (0.29) (0.51) -- (0.51) 9.63 (2.83)
1993 10.01 0.55 0.46 1.01 (0.59) -- (0.59) 10.43 10.35
1992 10.21 0.65 (0.22) 0.43 (0.63) -- (0.63) 10.01 4.51
1991 9.60 0.68 0.62 1.30 (0.69) -- (0.69) 10.21 14.35
GOVERNMENT SECURITIES SERIES CLASS C
1995+ 9.62 0.48 0.76 1.24 (0.48) -- (0.48) 10.38 13.27
1994 10.40 0.46 (0.79) (0.33) (0.45) -- (0.45) 9.62 (3.18)
1993 10.02 0.52 0.41 0.93 (0.55) -- (0.55) 10.40 9.48
1992(1) 9.86 0.52 0.09 0.61 (0.45) -- (0.45) 10.02 6.31
ZWEIG CASH FUND CLASS A (5)
1995 1.00 0.05 -- 0.05 (0.05) -- (0.05) 1.00 5.08
1994(4) 1.00 0.03 -- 0.03 (0.03) -- (0.03) 1.00 2.55**
ZWEIG CASH FUND CLASS C (5)
1995 1.00 0.05 -- 0.05 (0.05) -- (0.05) 1.00 5.08
1994(4) 1.00 0.03 -- 0.03 (0.03) -- (0.03) 1.00 2.55**
ZWEIG CASH FUND CLASS M (6)
1995 1.00 0.05 -- 0.05 (0.05) -- (0.05) 1.00 5.32
1994 1.00 0.04 -- 0.04 (0.04) -- (0.04) 1.00 3.67
1993 1.00 0.03 -- 0.03 (0.03) -- (0.03) 1.00 2.86
1992 1.00 0.03 -- 0.03 (0.03) -- (0.03) 1.00 3.40
1991 1.00 0.06 -- 0.06 (0.06) -- (0.06) 1.00 5.63
</TABLE>
<TABLE>
<CAPTION>
Ratios to Average
Net Assets Average
----------------------- Commission
Net Portfolio Per Share on Net Assets
Year Investment Turnover Portfolio End of Year
Ended Expenses Income Rate Transactions (in thousands)
- ----- -------- ---------- --------- ------------- --------------
<S> <C> <C> <C>
ZWEIG STRATEGY FUND CLASS A
1995 1.27% 1.92% 95% $0.03 $ 558,286
1994 1.40 1.90 70 N/A 424,805
1993 1.43 1.00 359 N/A 405,884
1992 1.63 1.32 249 N/A 358,318
1991 1.58 1.79 179 N/A 367,343
ZWEIG STRATEGY FUND CLASS C
1995 1.97 1.22 95 $0.03 530,300
1994 2.10 1.20 70 N/A 307,011
1993 2.13 0.30 359 N/A 188,631
1992(1) 2.43* 0.40* 249 N/A 64,697
ZWEIG APPRECIATION FUND CLASS A
1995 1.63 1.10 68 $0.03 272,590
1994 1.70 1.09 97 N/A 213,400
1993 1.73 0.52 69 N/A 230,230
1992 1.96 0.49 61 N/A 200,656
1991(2) 2.19* 1.27* 8 N/A 157,948
ZWEIG APPRECIATION FUND CLASS C
1995 2.33 0.40 68 $0.03 195,204
1994 2.40 0.39 97 N/A 139,397
1993 2.43 (0.18) 69 N/A 105,957
1992(1) 2.80* (0.32)* 61 N/A 42,089
ZWEIG MANAGED ASSETS CLASS A
1995 1.59 3.69 239 $0.03 141,110
1994 1.68 2.70 299 N/A 154,441
1993(3) 1.67* 1.93* 196 N/A 121,620
ZWEIG MANAGED ASSETS CLASS C
1995 2.29 2.99 239 $0.03 527,432
1994 2.38 2.00 299 N/A 570,710
1993(3) 2.37* 1.23* 196 N/A 429,088
GOVERNMENT SECURITIES SERIES CLASS A
1995+ 1.26 5.22 195 N/A 42,207
1994 1.28 5.07 191 N/A 47,622
1993 1.30 5.46 256 N/A 60,207
1992 1.30 6.58 200 N/A 70,062
1991 1.42 7.10 361 N/A 83,859
GOVERNMENT SECURITIES SERIES CLASS C
1995+ 1.71 4.77 195 N/A 19,778
1994 1.73 4.62 191 N/A 22,599
1993 1.75 5.01 256 N/A 21,301
1992(1) 1.81* 5.93* 200 N/A 9,210
ZWEIG CASH FUND CLASS A (5)
1995 0.87 4.97 N/A N/A 3,661
1994(4) 0.62** 2.52** N/A N/A 4,303
ZWEIG CASH FUND CLASS C (5)
1995 0.87 4.97 N/A N/A 4,458
1994(4) 0.61** 2.52** N/A N/A 5,040
ZWEIG CASH FUND CLASS M (6)
1995 0.64 5.20 N/A N/A 48,515
1994 0.70 3.58 N/A N/A 78,149
1993 0.70 2.83 N/A N/A 92,471
1992 0.70 3.35 N/A N/A 145,169
1991 0.66 5.63 N/A N/A 126,019
</TABLE>
(1) Commenced operations February 4, 1992.
(2) Commenced operations October 7, 1991.
(3) Commenced operations February 8, 1993.
(4) Commenced operations May 1, 1994.
(5) During 1995, the Manager voluntarily reimbursed Zweig Cash Fund Class A and
Class C $.005 and $.003 per share (.47% and .28% ratio of operating
expenses to average net assets), respectively.
(6) During 1995, 1994, 1993, 1992 and 1991, the Manager voluntarily reimbursed
Zweig Cash Fund Class M $.001, $.002, $.001, $.002 and $.001 per share
(.10%, .15%, .08%, .15%, and .15% ratio of operating expenses to average
net assets), respectively.
* Annualized
** Not Annualized
*** Total Return does not consider the effect of any initial or contingent
deferred sales charge.
+ Based on the average of the number of shares outstanding during the year.
40
<PAGE> 43
TRUSTEES
Claire B. Benenson
Richard E. Deems
S. Leland Dill
Eugene J. Glaser
Donald B. Romans
OFFICERS
Eugene J. Glaser
Chairman, Chief Executive Officer
and Trustee
Martin E. Zweig
President
David Katzen
Senior Vice President
Barry M. Mandinach
First Vice President
Carlton B. Neel
First Vice President
Alfred J. Ratcliffe
First Vice President & Treasurer
Charles I. Leone
First Vice President & Assistant
Secretary
Annemarie Gilly
Vice President
Maureen McQuaid
Assistant Vice President
Thomas Disbrow
Assistant Treasurer
Marc Baltuch
Secretary
INVESTMENT MANAGER
Zweig/Glaser Advisers
5 Hanover Square-17th Floor
New York, New York 10004
PRINCIPAL DISTRIBUTOR
Zweig Securities Corp.
5 Hanover Square-17th Floor
New York, New York 10004
CUSTODIAN
The Bank of New York
48 Wall Street
New York, New York 10015
TRANSFER AGENT
State Street Bank & Trust Co.
225 Franklin Street
Boston, Massachusetts 02110
SERVICING AGENT
Boston Financial Data Services, Inc.
2 Heritage Drive
North Quincy, Massachusetts 02171
COUNSEL
Shearman & Sterling
599 Lexington Avenue
New York, New York 10022
INDEPENDENT ACCOUNTANTS
Coopers & Lybrand L.L.P.
1301 Avenue of the Americas
New York, New York 10019
DESIGN: THE BLANK PAGE, INC. NEW YORK, NY
<PAGE> 44
ZWEIG MUTUAL FUNDS
5 Hanover Square-17th Floor
New York, New York 10004
BULK RATE
U.S. POSTAGE
PAID
METRO SELIGER
INDUSTRIES
