<PAGE>
PORTFOLIO MANAGERS' LETTER
EXECUTIVE INVESTORS BLUE CHIP FUND
Dear Investor:
We are pleased to present the semi-annual report for Executive Investors Blue
Chip Fund for the six months ended June 30, 1997. During the period, the Fund's
return on a net asset value basis was 16.8% compared to a return of 15.5% for
the Lipper Growth and Income Average.
At the beginning of the year, stock market observers were anticipating either a
slowdown in the economy or a series of interest rate hikes by the Federal
Reserve that might slow or end the current bull market. However, the economy, as
measured by the gross domestic product, expanded at an annual rate of 4.9% in
the first quarter with few signs of inflation contained in the economic
indicators and statistics. The outlook on inflation may keep the Federal Reserve
from taking any action on interest rates over the next few months. As the main
beneficiaries of the continued solid economic performance, U.S. companies posted
sound earnings and profit growth. The solid profit growth achieved by many
companies, coupled with expectations for continued growth, drove the stock
market to record levels during the first half of 1997.
The Blue Chip Fund's performance was driven by above-average returns from major
pharmaceutical companies such as Warner-Lambert, Eli Lilly, Bristol-Myers
Squibb, and Smithkline Beecham. Select technology companies such as Microsoft,
Sun Microsystems, and L.M. Ericsson, also contributed to the Fund's performance.
Many of the household name securities held in the Fund like General Electric,
Merrill Lynch, DuPont, Allstate, Procter & Gamble, Gillette and Wal-Mart, also
performed well in the first half of the year. The six month performance of the
Fund was held back by the performance of its holdings in select technology
companies such as Seagate, Intel and Hewlett-Packard which underperformed during
the period. The Fund's holdings in the electric utility sector such as FPL
Group, Sierra Pacific and Duke Energy, also underperformed during the period.
The Fund will continue to take a bottom up strategy while remaining sector
neutral and will maintain a long-term horizon. We will continue to focus on
companies with growth opportunities selling at price to earnings multiples in a
reasonable relationship to that growth. We will also continue to invest in
companies that can combine the growth attributes we seek with an income stream
in the form of dividends.
While we believe the economic fundamentals supporting continued solid
performance of the stock market remain in place, investors in equity securities
should be aware of the risks. The current bull market is in its seventh year and
valuations, as determined by price to earnings multiples, are at historic highs.
Substantive indications of a slowdown in the growth of profits could lead to a
reduction in market values. Another cause for concern is that the Federal
Reserve might raise interest rates to combat perceived inflationary pressures.
Higher interest rates could hurt corporate profits, reduce valuations, and
increase the attractiveness of alternative investments. In addition, the
possibility of an external, unanticipated event causing a market downturn is
always a risk. While these risks are real, market fundamentals appear strong and
our outlook for the stock market remains positive.
As always, we appreciate the opportunity to serve your investment needs.
Sincerely,
[SIGNATURE]
Patricia D. Poitra
Directors of Equities
and Co-Portfolio Manager
[SIGNATURE]
Dennis T. Fitzpatrick
Co-Portfolio Manager
July 28, 1997
1
<PAGE>
PORTFOLIO MANAGER'S LETTER
EXECUTIVE INVESTORS HIGH YIELD FUND
Dear Investor:
We are pleased to present the semi-annual report for Executive Investors High
Yield Fund for the six months ended June 30, 1997. During the period, the Fund
declared dividends from net investment income of 34.2 cents per share. For the
same period, the Fund's return on a net asset value basis was 4.7% per share
compared to a return of 5.9% for the average of all high yield funds as measured
by Lipper Analytical Services, Inc.
The first half of 1997 ended with an ideal economy: sustained, moderate growth
with little inflation. Early in the year it appeared that the economy might be
growing too fast as gross domestic product expanded at a 4.9% annual rate during
the first quarter. Concerned by the economy's strength, the Federal Reserve
raised short-term interest rates in March for the first time in over two years
as an "insurance policy" in case faster growth led to higher inflation. The
Federal Reserve's action subsequently appeared to be unnecessary as the economy
slowed down significantly in the second quarter and consumer price inflation in
fact decelerated to an annual rate of less than 2.5%.
Although both the bond and stock markets suffered setbacks at times during the
first six months of the year, the combination of moderate growth and low
inflation ultimately provided a positive environment for investors. The markets
were also buoyed by an agreement between the President and Congress to eliminate
the Federal budget deficit over the next five years. Lastly, the markets
benefited from substantial demand for both stocks and bonds throughout the first
half of 1997.
Many of the circumstances that caused the high yield market and the Executive
Investors High Yield Fund to perform well in 1996 continued through the first
half of 1997. These factors include buoyant capital markets and strong equity
valuations, which in turn supported credit sensitive debt securities. Indeed,
the total return from the junk bond market was 5.9%, according to the Credit
Suisse First Boston Index, which compares with a 2.5% return on ten-year
Treasury notes. This supportive background for financial markets stimulated
demand for high yield bonds. Investors with varying objectives sensed profit
potential and committed large amounts of money to junk bonds. The market
therefore had a voracious appetite for bonds and readily absorbed a total of
$57.6 billion in new issuance by the end of June.
High yield issuers have generally benefited from the benign economic
environment. We have seen many companies carry out bold strategies for growth
and operating improvement, aided by capital available at comparatively low cost.
Financial flexibility afforded to companies is illustrated by the fact that the
amount of extra yield earned on low rated (riskier) bonds continues to decline
relative to their more highly rated peers. For example, according to Chase
Securities, yields on B rated bonds have on average declined by .26% versus BB
rated bonds. This is an obvious positive for companies coming into the market to
borrow, as it bolsters precious corporate liquidity and has helped to fuel the
record issuance. Consistent with this overall landscape, default rates have been
low, amounting to .83% according to Merrill Lynch. None have occurred in the
High Yield Fund during this period.
The Fund was affected by its slightly higher than average quality distribution.
Also, its duration, or maturity schedule, is slightly shorter than some of its
competitors. This is meant to protect the Fund, and has succeeded at doing so,
but in the circumstances of early 1997, it caused the Fund to lag slightly. One
holding, Semi-Tech Corp., encountered some business volatility, from which it
and its bonds have substantially recovered. This bond continues to offer
attractive return potential. The Fund is reaping rewards from investments that
have succeeded and redeploying cash
2
<PAGE>
into issuers which are at earlier stages in their business plans. This will have
the effect of linking the Fund more closely to current market conditions.
Merger and acquisition activity has been brisk, as companies have combined to
achieve stronger market positions and operating improvements. The Fund has
participated selectively in several such transactions that we expect will lead
to credit improvement that the market will applaud. Several portfolio holdings
have appreciated when they have received significant equity investments or were
involved in a stock for stock merger that directly improved their credit
strength.
Aware that this positive environment can change, we remain watchful for
corporate and industry developments that affect the credit direction of the
Fund's holdings and the relative values within our market, as well as for
investment opportunities.
Investors who buy bond funds--whether for income or total return--should be
aware that the value of their investment fluctuates as interest rates change.
For example, a 1% increase in yield on a ten-year Treasury bond results in
roughly a 7% decrease in that bond's price. In each of the last five years,
ten-year Treasury bond yields have moved more than 1%. In addition, the value of
a fund can fluctuate based on changes in the credit quality of the bonds which
it holds. In particular, high yield funds invest in lower-rated debt obligations
which are more sensitive than higher-rated investments to adverse economic
changes or individual corporate developments, and thus can be subject to a
higher incidence of default. Investors should be aware of these risks and
recognize that successful investing generally requires a long-term commitment to
the market.
The outlook for the financial markets continues to be positive. The economy is
growing moderately, inflation is subdued and the Federal Reserve is unlikely to
tolerate unsustainably fast economic growth. Demand for financial assets is
likely to remain strong both here and overseas. While the sizable recent returns
in some markets are not likely to continue, the factors which might cause a
sustained downturn are not readily apparent. Despite this optimistic outlook,
investors should keep in mind that a diversified portfolio provides the best
insurance against unexpected changes in the financial markets.
As always, we appreciate the opportunity to serve your investment needs.
Sincerely,
[SIGNATURE]
George V. Ganter
Vice President
and Portfolio Manager
July 28, 1997
3
<PAGE>
PORTFOLIO MANAGER'S LETTER
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
Dear Investor:
We are pleased to present the semi-annual report for Executive Investors Insured
Tax Exempt Fund for the six months ended June 30, 1997. During the period, the
Fund declared dividends from net investment income of 33.6 cents per share. For
the same period, the Fund's return on a net asset value basis was 2.9% which
compared favorably to the average return of 2.4% for insured municipal bond
funds as reported by Lipper Analytical Services, Inc.
The first half of 1997 ended with an ideal economy: sustained, moderate growth
with little inflation. Early in the year it appeared that the economy might be
growing too fast as gross domestic product expanded at a 4.9% annual rate during
the first quarter. Concerned by the economy's strength, the Federal Reserve
raised short-term interest rates in March for the first time in over two years
as an "insurance policy" in case faster growth led to higher inflation. The
Federal Reserve's action subsequently appeared to be unnecessary as the economy
slowed down significantly in the second quarter and consumer price inflation in
fact decelerated to an annual rate of less than 2.5%.
Although both the bond and stock markets suffered setbacks at times during the
first six months of the year, the combination of moderate growth and low
inflation ultimately provided a positive environment for investors. The markets
were also buoyed by an agreement between the President and Congress to eliminate
the Federal budget deficit over the next five years. Lastly, the markets
benefited from substantial demand for both stocks and bonds throughout the first
half of 1997.
Like most of the financial markets, the municipal bond market was characterized
by strong demand from investors throughout the first half of the year. Despite
issuance of close to $94 billion, the market rarely had trouble distributing
supply due to demand from individuals, insurance companies and non-traditional
buyers of municipal bonds. The strength of this demand is best indicated by the
fact that, during the first six months of 1997, long-term municipal bond prices
rose while long-term Treasury bond prices fell. As a result, tax exempt bonds
provided after-tax returns that significantly surpassed those on taxable bonds
for most investors.
Management of the Fund focused on responding to two shifts in the market's trend
during the first half of the year. As the market fell sharply during March, the
Fund reduced its interest rate exposure by slightly increasing its cash
position. At this time, the Fund also took advantage of the market's decline by
selling bonds purchased at lower yields and replacing them with higher yielding
bonds often with better call protection. When it became apparent in May that
interest rates had bottomed, the Fund moved back to being fully invested. During
May and June, the Fund had substantial positive returns in large part because of
its holdings of non-callable bonds which have been accumulated over the past
several years. The market closed the second quarter on a strong note as
reinvestment demand from the relatively large June and July coupon payments
propelled prices to their highest level of the year before pulling back
slightly.
Investors who buy bond funds--whether for income or total return--should be
aware that the value of their investment fluctuates as interest rates change.
For example, a 100 basis point (or 1%) increase in yield on a ten-year Treasury
bond results in roughly a 7% decrease in that bond's price. In each of the last
five years, ten-year Treasury bond yields have moved more than 100 basis points.
In addition, while the Fund's municipal bonds are insured as to timely payment
of principal and interest, the insurance does not protect the bonds against
changes in market value. Investors
4
<PAGE>
should be aware of these risks and recognize that successful investing generally
requires a long-term commitment to the market.
The outlook for the financial markets continues to be positive. The economy is
growing moderately, inflation is subdued and the Federal Reserve is unlikely to
tolerate unsustainably fast economic growth. Demand for financial assets is
likely to remain strong both here and overseas. While the sizable recent returns
in some markets are not likely to continue, the factors which might cause a
sustained downturn are not readily apparent. Despite this optimistic outlook,
investors should keep in mind that a diversified portfolio provides the best
insurance against unexpected changes in the financial markets.
As always, we appreciate the opportunity to serve your investment needs.
Sincerely,
[SIGNATURE]
Clark D. Wagner
Chief Investment Officer
and Portfolio Manager
July 28, 1997
5
<PAGE>
PORTFOLIO OF INVESTMENTS
EXECUTIVE INVESTORS BLUE CHIP FUND
June 30, 1997
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000 OF
SHARES SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMON STOCKS--94.6%
BASIC MATERIALS--4.6%
100 Aluminum Company of America $ 7,537 $ 26
400 Du Pont (E.I.) de Nemours & Company 25,150 86
100 *FMC Corporation 7,944 27
100 Freeport-McMoRan Copper & Gold, Inc. - Class "B" 3,112 11
300 International Paper Company 14,569 50
400 James River Corporation of Virginia 14,800 51
500 Monsanto Company 21,531 74
300 Morton International, Inc. 9,056 31
100 Pioneer Hi-Bred International, Inc. 8,000 27
200 Sigma-Aldrich Corporation 7,012 24
300 Weyerhauser Company 15,600 54
- -------------------------------------------------------------------------------------
134,311 461
- -------------------------------------------------------------------------------------
CAPITAL GOODS--12.4%
200 AlliedSignal, Inc. 16,800 58
300 Avery Dennison Corporation 12,037 41
200 Boeing Company 10,612 36
300 Corning, Inc. 16,687 57
300 Emerson Electric Company 16,519 57
200 Fluor Corporation 11,037 38
200 Foster Wheeler Corporation 8,100 28
1,100 General Electric Company 71,912 247
500 Ingersoll-Rand Company 30,875 106
200 Lockheed Martin Corporation 20,712 71
700 *Philip Services Corporation 11,112 38
500 Tenneco, Inc. 22,594 77
600 Textron, Inc. 39,825 137
500 Thomas & Betts Corporation 26,281 90
200 Tyco International Ltd. 13,912 48
200 United Technologies Corporation 16,600 57
400 *USA Waste Services, Inc. 15,450 53
- -------------------------------------------------------------------------------------
361,065 1,239
- -------------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000 OF
SHARES SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMUNICATION SERVICES--4.1%
600 A T & T Corporation $ 21,037 $ 72
200 *AirTouch Communications, Inc. 5,475 19
300 Bell Atlantic Corporation 22,762 78
400 BellSouth Corporation 18,550 64
600 GTE Corporation 26,325 90
200 MCI Communications Corporation 7,656 26
300 SBC Communications, Inc. 18,562 64
- -------------------------------------------------------------------------------------
120,367 413
- -------------------------------------------------------------------------------------
CONSUMER CYCLICALS--8.3%
200 Adidas AG (ADR) (Note 4) 11,076 38
300 *Costco Companies, Inc. 9,862 34
600 *CUC International, Inc. 15,487 53
500 *Federated Department Stores, Inc. 17,375 60
600 Hasbro, Inc. 17,025 58
500 Hilton Hotels Corporation 13,281 46
400 Home Depot, Inc. 27,575 95
500 *Lear Corporation 22,187 76
150 Masco Corporation 6,262 21
200 McGraw-Hill Companies, Inc. 11,762 40
400 Ogden Corporation 8,700 30
800 *PETsMART, Inc. 9,200 32
400 *Staples, Inc. 9,300 32
500 Tribune Company 24,031 82
200 Unifi, Inc. 7,475 26
900 Wal-Mart Stores, Inc. 30,431 104
- -------------------------------------------------------------------------------------
241,029 827
- -------------------------------------------------------------------------------------
CONSUMER STAPLES--12.9%
500 Anheuser-Busch Companies, Inc. 20,969 72
200 Clorox Company 26,400 91
500 Coca-Cola Company 33,750 116
300 ConAgra, Inc. 19,237 66
300 CPC International, Inc. 27,694 95
400 Gillette Company 37,900 130
1,000 *Host Marriott Corporation 17,812 61
- -------------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
PORTFOLIO OF INVESTMENTS
EXECUTIVE INVESTORS BLUE CHIP FUND
June 30, 1997
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000 OF
SHARES SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
CONSUMER STAPLES (continued)
200 Kimberly-Clark Corporation $ 9,950 $ 34
1,100 PepsiCo, Inc. 41,319 142
300 Philip Morris Companies, Inc. 13,312 46
300 Procter & Gamble Company 42,375 145
200 Rite Aid Corporation 9,975 34
213 *Safeway, Inc. 9,825 34
400 *Steiner Leisure Ltd. 11,150 38
300 *Tele-Communications, Inc. Liberty Media Group -
Series "A" 7,125 24
100 Unilever N.V. 21,800 75
300 Walt Disney Company 24,075 83
- -------------------------------------------------------------------------------------
374,668 1,286
- -------------------------------------------------------------------------------------
ENERGY--9.7%
150 Amoco Corporation 13,041 45
300 Baker Hughes, Inc. 11,606 40
600 Chevron Corporation 44,363 152
500 Dresser Industries, Inc. 18,625 64
400 Exxon Corporation 24,600 84
50 Kerr-McGee Corporation 3,169 11
400 Mobil Corporation 27,950 96
600 *Oryx Energy Company 12,675 43
900 Royal Dutch Petroleum Company 48,938 168
200 Schlumberger Ltd. 25,000 86
200 Texaco, Inc. 21,750 75
200 Unocal Corporation 7,763 27
500 Williams Companies, Inc. 21,875 75
- -------------------------------------------------------------------------------------
281,355 966
- -------------------------------------------------------------------------------------
FINANCIAL--12.4%
200 Allstate Corporation 14,600 50
200 American Express Company 14,900 51
150 American International Group, Inc. 22,406 77
300 BankAmerica Corporation 19,369 66
400 BankBoston Corporation 28,825 99
200 Chase Manhattan Corporation 19,413 67
400 Citicorp 48,225 165
- -------------------------------------------------------------------------------------
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000 OF
SHARES SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
FINANCIAL (continued)
500 Fannie Mae $ 21,813 $ 75
200 First Union Corporation 18,500 63
400 Freddie Mac 13,750 47
300 Jefferson-Pilot Corporation 20,963 72
200 Marshall & Ilsley Corporation 8,125 28
300 Merrill Lynch & Company, Inc. 17,888 61
300 NationsBank Corporation 19,350 66
400 Norwest Corporation 22,500 77
1,100 The Money Store, Inc. 31,556 108
100 Travelers Group, Inc 6,306 22
600 USF&G Corporation 14,400 49
- -------------------------------------------------------------------------------------
362,889 1,243
- -------------------------------------------------------------------------------------
HEALTHCARE--13.3%
250 Abbott Laboratories 16,688 57
500 American Home Products Corporation 38,250 131
500 *Amgen, Inc. 29,063 100
300 Baxter International, Inc. 15,675 54
700 Bristol-Myers Squibb Company 56,700 194
500 *Cardiovascular Dynamics, Inc. 3,938 14
300 Eli Lilly & Company 32,794 112
400 Johnson & Johnson 25,750 88
700 *MedPartners, Inc. 15,138 52
200 Medtronic, Inc. 16,200 56
500 Merck & Company, Inc. 51,750 177
700 Pharmacia & Upjohn, Inc. 24,325 83
500 *RoTech Medical Corporation 10,031 34
300 SmithKline Beecham PLC - Class "A" (ADR) 27,488 94
200 Warner-Lambert Company 24,850 85
- -------------------------------------------------------------------------------------
388,640 1,331
- -------------------------------------------------------------------------------------
TECHNOLOGY--15.1%
500 *Adaptec, Inc. 17,375 60
600 *Atmel Corporation 16,800 58
300 *Cadence Design Systems, Inc. 10,050 34
300 *Cisco Systems, Inc. 20,138 69
- -------------------------------------------------------------------------------------
</TABLE>
9
<PAGE>
PORTFOLIO OF INVESTMENTS
EXECUTIVE INVESTORS BLUE CHIP FUND
June 30, 1997
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000 OF
SHARES SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
TECHNOLOGY (continued)
600 Comdisco, Inc. $ 15,600 $ 54
100 Eastman Kodak Company 7,675 26
900 Ericsson (L.M.) Telephone Co. - Class "B" (ADR) 35,438 122
400 First Data Corporation 17,575 60
100 *Hadco Corporation 6,550 22
400 Hewlett-Packard Company 22,400 77
200 Intel Corporation 28,363 97
500 *Micron Technology, Inc. 19,969 68
300 *Microsoft Corporation 37,913 130
500 Motorola, Inc. 38,000 130
300 *Newbridge Networks Corporation 13,050 45
400 Nokia Corporation - Class "A" (ADR) 29,500 101
175 *Oracle Corporation 8,816 30
200 Raytheon Company 10,200 35
200 *Seagate Technology, Inc. 7,038 24
300 *Sterling Commerce, Inc. 9,863 34
700 *Sun Microsystems, Inc. 26,053 89
300 *Synopsys, Inc. 11,025 38
1,200 *SystemSoft Corporation 12,900 44
200 Texas Instruments, Inc. 16,813 58
- -------------------------------------------------------------------------------------
439,104 1,505
- -------------------------------------------------------------------------------------
TRANSPORTATION--.3%
100 Burlington Northern Santa Fe 8,988 31
- -------------------------------------------------------------------------------------
UTILITIES--1.5%
300 Duke Energy Corporation 14,381 49
250 FPL Group, Inc. 11,516 39
600 Sierra Pacific Resources 19,200 66
- -------------------------------------------------------------------------------------
45,097 154
- -------------------------------------------------------------------------------------
TOTAL VALUE OF COMMON STOCKS (cost $2,011,453) 2,757,513 9,456
- -------------------------------------------------------------------------------------
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
SHORT-TERM CORPORATE NOTES--3.4%
$ 100M Carolina Power & Light Co., 5.53%, 7/24/97
(cost $99,647) $ 99,647 $ 342
- -------------------------------------------------------------------------------------
TOTAL VALUE OF INVESTMENTS (cost $2,111,100) 98.0% 2,857,160 9,798
OTHER ASSETS, LESS LIABILITIES 2.0 58,818 202
- -------------------------------------------------------------------------------------
NET ASSETS 100.0% $2,915,978 $10,000
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
See notes to financial statements
11
<PAGE>
PORTFOLIO OF INVESTMENTS
EXECUTIVE INVESTORS HIGH YIELD FUND
June 30, 1997
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
CORPORATE BONDS--90.4%
AEROSPACE/DEFENSE--2.7%
$ 200M Howmet Corp., 10%, 2003 (Note 4) $ 216,000 $ 120
150M K & F Industries, Inc., 10.375%, 2004 159,000 88
100M Moog, Inc., 10%, 2006 105,500 59
- -------------------------------------------------------------------------------------
480,500 267
- -------------------------------------------------------------------------------------
APPAREL/TEXTILES--4.1%
300M Pillowtex, 10%, 2006 317,625 177
400M Westpoint Stevens, Inc., 9.375%, 2005 416,000 231
- -------------------------------------------------------------------------------------
733,625 408
- -------------------------------------------------------------------------------------
AUTOMOTIVE--.8%
150M Lear Seating, Inc., 11.25%, 2000 151,125 84
- -------------------------------------------------------------------------------------
BUILDING MATERIALS--1.8%
299M ISP Holdings, Inc., 9.75%, 2002 318,435 177
- -------------------------------------------------------------------------------------
CHEMICALS--4.2%
300M Harris Chemical North America, Inc., 10.25%, 2001 308,250 171
400M Rexene Corp., 11.75%, 2004 454,000 252
- -------------------------------------------------------------------------------------
762,250 423
- -------------------------------------------------------------------------------------
CONSUMER PRODUCTS--6.0%
300M Commemorative Brands, Inc., 11%, 2007 315,750 176
300M Herff Jones, Inc., 11%, 2005 324,000 180
300M Semi-Tech Corp., 0%-11.50%, 2003 180,750 100
250M Syratech Corp., 11%, 2007 267,187 149
- -------------------------------------------------------------------------------------
1,087,687 605
- -------------------------------------------------------------------------------------
CONTAINERS/PACKAGING--2.3%
400M Radnor Holdings, Inc., 10%, 2003 416,000 231
- -------------------------------------------------------------------------------------
DURABLE GOODS MANUFACTURING--1.2%
200M Fairfield Manufacturing, Inc., 11.375%, 2001 214,000 119
- -------------------------------------------------------------------------------------
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
ELECTRICAL EQUIPMENT--3.8%
$ 200M Amphenol Corp., 9.875%, 2007 $ 206,000 $ 115
350M Essex Group, Inc., 10%, 2003 367,500 204
100M Thermadyne Holdings Corp., 10.75%, 2003 103,125 57
- -------------------------------------------------------------------------------------
676,625 376
- -------------------------------------------------------------------------------------
ENERGY--7.4%
300M Falcon Drilling Co., Inc., 12.50%, 2005 333,000 185
400M Giant Industries, Inc., 9.75%, 2003 413,000 230
250M Maxus Energy Corp., 11.50%, 2015 262,187 146
300M United Meridian Corp., 10.375%, 2005 327,000 182
- -------------------------------------------------------------------------------------
1,335,187 743
- -------------------------------------------------------------------------------------
FINANCIAL SERVICES--.6%
100M Terra Nova Holdings, PLC, 10.75%, 2005 111,250 62
- -------------------------------------------------------------------------------------
FOOD/BEVERAGE/TOBACCO--1.9%
300M Van de Kamps, Inc., 12%, 2005 336,000 187
- -------------------------------------------------------------------------------------
GAMING/LODGING--2.9%
250M Casino America, Inc., 12.50%, 2003 260,938 145
250M Grand Casinos, Inc., 10.125%, 2003 258,750 144
- -------------------------------------------------------------------------------------
519,688 289
- -------------------------------------------------------------------------------------
HEALTHCARE--3.0%
200M Dade International, Inc., 11.125%, 2006 222,500 124
300M Tenet Healthcare Corp., 10.125%, 2005 327,000 182
- -------------------------------------------------------------------------------------
549,500 306
- -------------------------------------------------------------------------------------
MEDIA/CABLE TELEVISION--15.0%
500M Bell Cablemedia, PLC, 0%-11.95%, 2004 454,375 253
650M Echostar Communications Corp., 0%-12.875%, 2004 546,000 304
300M Garden State Newspapers, Inc., 12%, 2004 333,000 185
300M Grupo Televisa, S.A., 11.875%, 2006 339,000 189
300M Outdoor Systems, Inc., 8.875%, 2007 (Note 4) 291,000 162
- -------------------------------------------------------------------------------------
</TABLE>
13
<PAGE>
PORTFOLIO OF INVESTMENTS
EXECUTIVE INVESTORS HIGH YIELD FUND
June 30, 1997
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
MEDIA/CABLE TELEVISION (continued)
$ 300M Rogers Cablesystems, Inc., 10%, 2005 $ 325,500 $ 181
400M TCI Satellite Entertainment, Inc., 10.875%, 2007
(Note 4) 401,000 223
- -------------------------------------------------------------------------------------
2,689,875 1,497
- -------------------------------------------------------------------------------------
MINING/METALS--10.6%
274M Carbide/Graphite Group, Inc., 11.50%, 2003 300,030 167
400M Euramax International, PLC, 11.25%, 2006 430,000 239
200M Gulf States Steel Inc., 13.50%, 2003 201,000 112
240M UCAR Global Enterprises, Inc., 12%, 2005 271,350 151
300M Wells Aluminum Corp., 10.125%, 2005 (Note 4) 310,500 173
400M Wheeling-Pittsburgh Steel Corp., 9.375%, 2003 388,000 216
- -------------------------------------------------------------------------------------
1,900,880 1,058
- -------------------------------------------------------------------------------------
MISCELLANEOUS--2.5%
100M Allied Waste, North America, 10.25%, 2006 (Note
4) 107,250 60
350M Kindercare Learning Centers, Inc., 9.50%, 2009 339,938 189
- -------------------------------------------------------------------------------------
447,188 249
- -------------------------------------------------------------------------------------
PAPER/FOREST PRODUCTS--5.8%
300M Gaylord Container Corp., 11.50%, 2001 313,500 174
350M Riverwood International, 10.25%, 2006 345,188 192
350M S.D. Warren Co., Inc., 12%, 2004 390,250 217
- -------------------------------------------------------------------------------------
1,048,938 583
- -------------------------------------------------------------------------------------
REAL ESTATE/CONSTRUCTION--.9%
150M Continental Homes Holding Corp., 10%, 2006 154,500 86
- -------------------------------------------------------------------------------------
TELECOMMUNICATIONS--9.2%
450M American Communication Services, Inc., 0%-13%,
2005 268,875 149
500M Brooks Fiber Properties, Inc., 0%-10.875%, 2006 341,250 190
500M Comcast Cellular Corp., 9.50%, 2007 (Note 4) 503,125 280
200M InterCel, Inc., 0%-12%, 2006 124,750 69
- -------------------------------------------------------------------------------------
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
PRINCIPAL INVESTED
AMOUNT FOR EACH
OR $10,000 OF
SHARES SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
TELECOMMUNICATIONS (continued)
$ 400M McCaw International, Ltd, 0%-13%, 2007 (Note 4) $ 190,000 $ 106
200M Qwest Communications International, Inc.,
10.875%, 2007 (Note 4) 218,500 121
- -------------------------------------------------------------------------------------
1,646,500 915
- -------------------------------------------------------------------------------------
TRANSPORTATION--3.7%
300M Moran Transportation Co., 11.75%, 2004 333,000 185
350M Trism, Inc., 10.75%, 2000 339,500 189
- -------------------------------------------------------------------------------------
672,500 374
- -------------------------------------------------------------------------------------
TOTAL VALUE OF CORPORATE BONDS (cost $15,612,948) 16,252,253 9,039
- -------------------------------------------------------------------------------------
COMMON STOCKS--.2%
MEDIA/CABLE TELEVISION
2,203 *Echostar Communications Corp. - Class "A"
(cost $0) 34,422 19
- -------------------------------------------------------------------------------------
PREFERRED STOCKS--5.7%
FINANCIAL--1.9%
3,000 California Federal Bank, 10.625%, Series "B" 334,500 186
- -------------------------------------------------------------------------------------
MEDIA/CABLE TELEVISION--1.7%
254 PanAmSat Capital Corp., 12.75%, PIK 314,786 175
- -------------------------------------------------------------------------------------
PAPER/FOREST PRODUCTS--2.1%
9,000 S.D. Warren Co., Inc., 14%, Series "B" 387,000 215
- -------------------------------------------------------------------------------------
TOTAL VALUE OF PREFERRED STOCKS (cost $812,114) 1,036,286 576
- -------------------------------------------------------------------------------------
</TABLE>
15
<PAGE>
PORTFOLIO OF INVESTMENTS
EXECUTIVE INVESTORS HIGH YIELD FUND
June 30, 1997
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
AMOUNT
WARRANTS INVESTED
OR FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
WARRANTS--.4%
GAMING/LODGING--.0%
200 *Goldriver Finance Corp., Liquidating Trust $ -- $ --
- -------------------------------------------------------------------------------------
MINING/METALS--.0%
200 *Gulf State Steel Acquistion Corp. (expiring
4/15/03) (Note 4) 2 --
- -------------------------------------------------------------------------------------
PAPER/FOREST PRODUCTS--.3%
9,000 *S.D. Warren Co., Inc. (expiring 12/15/06) (Note
4) 45,000 25
- -------------------------------------------------------------------------------------
TELECOMMUNICATIONS--.1%
450 *American Communication Services, Inc. (expiring
11/1/05) (Note 4) 21,375 12
- -------------------------------------------------------------------------------------
TOTAL VALUE OF WARRANTS (cost $0) 66,377 37
- -------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--1.4%
$ 250M McCormick & Company, Inc., 6.05%, 7/1/97
(cost $250,000) 250,000 139
- -------------------------------------------------------------------------------------
TOTAL VALUE OF INVESTMENTS (cost $16,675,062) 98.1% 17,639,338 9,810
OTHER ASSETS, LESS LIABILITIES 1.9 340,850 190
- -------------------------------------------------------------------------------------
NET ASSETS 100.0% $17,980,188 $10,000
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
See notes to financial statements
16
<PAGE>
PORTFOLIO OF INVESTMENTS
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
June 30, 1997
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
MUNICIPAL BONDS--100.1%
ALABAMA--1.7%
$ 250M Coffee Cnty. Public Bldg. Authority, 6.10%,
9/1/2016 $ 259,062 $ 166
- --------------------------------------------------------------------------------------
ARIZONA--3.3%
250M Maricopa County Development Authority Hosp. Facs.
Rev., 7%, 12/1/2016 295,000 189
200M Maricopa County Uni. Sch. Dist. Gen. Oblig. #80
(Chandler),
6.25%, 7/1/2011 221,500 142
- --------------------------------------------------------------------------------------
516,500 331
- --------------------------------------------------------------------------------------
CALIFORNIA--10.3%
Los Angeles County, Calif. Transportation Comm.
Sales Tax Revenue:
100M 6.75%, 7/1/2001 * 110,500 71
100M 6.90%, 7/1/2001 * 111,125 71
250M San Francisco City & County Parking Auth., 7%,
6/1/2012 285,625 183
500M San Francisco City & County Redev. Agy. (Moscone
Ctr.),
6.75%, 7/1/2015 551,875 354
250M San Jose Redevelopment Agency, 6%, 8/1/2015 268,750 173
250M Santa Ana Fin. Auth. Lease Rev., 6.25%, 7/1/2015 274,375 176
- --------------------------------------------------------------------------------------
1,602,250 1,028
- --------------------------------------------------------------------------------------
COLORADO--2.5%
350M Roaring Fork General Obligation, 6.60%,
6/15/2004 * 391,125 251
- --------------------------------------------------------------------------------------
CONNECTICUT--2.7%
400M Connecticut Special Tax Oblig. Rev., 6.10%,
10/1/2011 424,000 272
- --------------------------------------------------------------------------------------
DELAWARE--.9%
130M Delaware Cnty. Hosp. Auth. (Ball Memorial Hosp.),
6.625%, 8/1/2006 140,725 90
- --------------------------------------------------------------------------------------
FLORIDA--8.5%
335M Cocoa, Fla. Water & Sewer Revenue, 5.75%,
10/1/2017 340,444 219
500M Halifax, Florida Hospital, 5.25%, 10/1/2015 481,875 309
500M Pensecola, Florida Airport Revenue, 5.60%,
10/1/2017 503,125 323
- --------------------------------------------------------------------------------------
1,325,444 851
- --------------------------------------------------------------------------------------
</TABLE>
17
<PAGE>
PORTFOLIO OF INVESTMENTS
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
June 30, 1997
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
GEORGIA--.7%
$ 100M Cherokee County Water & Sewer Auth. Rev., 7.10%,
8/1/2000 * $ 109,500 $ 70
- --------------------------------------------------------------------------------------
ILLINOIS--11.3%
500M Chicago Board of Education, 6.25%, 12/1/2012 548,750 352
500M Chicago General Obligation, 6%, 1/1/2010 531,875 341
500M Illinois Dev. Fin. Auth. (Rockford School 205),
6.55%, 2/1/2009 561,875 361
100M Will County School District General Obligation,
7.10%, 12/1/2009 118,125 76
- --------------------------------------------------------------------------------------
1,760,625 1,130
- --------------------------------------------------------------------------------------
MAINE--1.8%
250M Maine Municipal Bond Bank, 6.50%, 11/1/2014 273,437 176
- --------------------------------------------------------------------------------------
MASSACHUSETTS--3.4%
500M Mass. Bay Transportation Authority Gen. Sys.
Rev., 5.80%, 3/1/2013 527,425 339
- --------------------------------------------------------------------------------------
MICHIGAN--1.9%
1,000M Howell Public Schools General Obligation, Zero
Coupon, 5/1/2006 * 296,250 190
- --------------------------------------------------------------------------------------
MISSOURI--5.0%
200M Liberty, Mo., Sewer System Revenue, 6.15%,
2/1/2015 212,750 137
500M Missouri State Health & Educational Facilities
Auth. (BJC Health System), 6.75%, 5/15/2010 572,500 367
- --------------------------------------------------------------------------------------
785,250 504
- --------------------------------------------------------------------------------------
NEW JERSEY--5.6%
350M New Jersey Economic Development Authority Rev.,
5.50%, 5/1/2017 348,687 224
485M New Jersey Housing & Mortgage Fin. Rev., 6.55%,
10/1/2010 517,737 332
- --------------------------------------------------------------------------------------
866,424 556
- --------------------------------------------------------------------------------------
NEW YORK--2.0%
290M New York City Municipal Water Fin. Auth. Rev.,
5.875%, 6/15/2001 * 306,313 197
- --------------------------------------------------------------------------------------
NORTH CAROLINA--4.3%
250M Gaston, North Carolina Certificate of
Participation, 5.25%, 12/1/2016 241,563 155
430M North Carolina Central Univ. Hsg. Rev., 5.75%,
11/1/2015 436,988 280
- --------------------------------------------------------------------------------------
678,551 435
- --------------------------------------------------------------------------------------
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
OHIO--1.6%
$ 250M Lorain County, Ohio Hosp. Rev. (Catholic
Healthcare Partners),
5.625%, 9/1/2014 $ 250,625 $ 161
- --------------------------------------------------------------------------------------
OKLAHOMA--3.5%
500M Grand River Dam Authority Revenue,
6.25%, 6/1/2011 552,500 355
- --------------------------------------------------------------------------------------
OREGON--4.9%
500M Oregon State Dept. of Administrative Services,
Cert. of Partic.,
5.65%, 5/1/2012 508,125 326
250M Tillamook County, Oregon General Obligation,
5.60%, 1/15/2012 255,000 164
- --------------------------------------------------------------------------------------
763,125 490
- --------------------------------------------------------------------------------------
PENNSYLVANIA--7.3%
525M Erie, Pennsylvania General Obligation, 5.75%,
5/15/2013 536,156 344
200M Jeannette, Pa. School District General
Obligation, 6.65%, 6/1/2001 * 215,750 138
350M Philaldelphia Water & Wastewater Rev., 6.25%,
8/1/2012 382,375 245
- --------------------------------------------------------------------------------------
1,134,281 727
- --------------------------------------------------------------------------------------
PUERTO RICO--6.6%
400M Puerto Rico Commonwealth Hwy. & Transn. Auth.
Rev., 6.25%, 7/1/2014 445,000 286
545M Puerto Rico Indl. Tourist Edl. Med. & Env. Ctl.
Facs., 6.25%, 7/1/2016 582,469 374
- --------------------------------------------------------------------------------------
1,027,469 660
- --------------------------------------------------------------------------------------
RHODE ISLAND--1.4%
200M Rhode Island Convention Center Authority Series
"A", 6.70%, 5/15/2001 * 219,000 141
- --------------------------------------------------------------------------------------
TEXAS--8.9%
505M Austin, Texas Utility System Rev., 6%, 11/15/2013 542,244 348
500M Harris County General Obligation, 6.50%,
8/15/2013 562,695 361
250M Houston, Water Conveyance System Cert.of Part.,
6.25%, 12/15/2012 275,625 177
- --------------------------------------------------------------------------------------
1,380,564 886
- --------------------------------------------------------------------------------------
TOTAL VALUE OF MUNICIPAL BONDS (cost $14,584,587) 15,590,445 10,006
- --------------------------------------------------------------------------------------
</TABLE>
19
<PAGE>
PORTFOLIO OF INVESTMENTS
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
June 30, 1997
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
SHORT-TERM TAX EXEMPT INVESTMENTS--.6%
$ 100M Valdez Alaska Marine Terminal (Exxon Pipeline Co.
Project A),
4.00% **
(cost $100,000) $ 100,000 $ 64
- --------------------------------------------------------------------------------------
TOTAL VALUE OF INVESTMENTS (cost $14,684,587) 100.7% 15,690,445 10,070
EXCESS OF LIABILITIES OVER OTHER ASSETS (.7) (109,063) (70)
- --------------------------------------------------------------------------------------
NET ASSETS 100.0% $15,581,382 $10,000
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
</TABLE>
* Municipal Bonds which have been prerefunded are shown maturing at the
prerefunded call date.
** Interest rates on Adjustable Rate Notes are determined and reset daily by the
issuer. Interest rate shown is the rate in effect at June 30, 1997.
See notes to financial statements
20
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
EXECUTIVE INVESTORS TRUST
June 30, 1997
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
BLUE CHIP HIGH YIELD INSURED TAX
FUND FUND EXEMPT FUND
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investment in securities:
At identified cost................... $2,111,100 $16,675,062 $14,684,587
--------- ---------- -----------
--------- ---------- -----------
At value (Note 1A)................... $2,857,160 $17,639,338 $15,690,445
Cash................................... 65,655 255,095 22,282
Receivables:
Interest and dividends............... 1,914 331,542 228,694
Trust shares sold.................... 674 3,351 95
Investment securities sold........... 9,974 -- 204,074
Other assets........................... 4 4,966 17
--------- ---------- -----------
Total Assets........................... 2,935,381 18,234,292 16,145,607
--------- ---------- -----------
LIABILITIES
Payables:
Trust shares redeemed................ 100 99,879 11,340
Investment securities purchased...... 15,068 -- 486,709
Dividend payable..................... -- 125,367 61,258
Accrued expenses....................... 3,639 21,343 1,696
Accrued advisory fee................... 596 7,515 3,222
--------- ---------- -----------
Total Liabilities...................... 19,403 254,104 564,225
--------- ---------- -----------
NET ASSETS............................. $2,915,978 $17,980,188 $15,581,382
--------- ---------- -----------
--------- ---------- -----------
NET ASSETS CONSIST OF:
Capital paid in........................ $2,026,714 $22,058,057 $14,564,308
Undistributed net investment income.... 9,687 176,308 2,635
Accumulated net realized gain (loss) on
investment transactions.............. 133,517 (5,218,453) 8,581
Net unrealized appreciation in value of
investments.......................... 746,060 964,276 1,005,858
--------- ---------- -----------
Total.................................. $2,915,978 $17,980,188 $15,581,382
--------- ---------- -----------
--------- ---------- -----------
SHARES OF BENEFICIAL INTEREST
OUTSTANDING.......................... 136,344 2,272,588 1,122,650
--------- ---------- -----------
--------- ---------- -----------
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE
(Net assets divided by trust shares
outstanding)......................... $ 21.39 $ 7.91 $ 13.88
--------- ----- -----------
--------- ----- -----------
MAXIMUM OFFERING PRICE PER SHARE
(Net asset value/.9525)*............. $ 22.46 $ 8.30 $ 14.57
--------- ----- -----------
--------- ----- -----------
</TABLE>
* On purchases of $100,000 or more, the sales charge is reduced.
See notes to financial statements
21
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
EXECUTIVE INVESTORS TRUST
<TABLE>
<CAPTION>
- ----------------------------------------------------------------
BLUE CHIP FUND
----------------------
1/1/97 TO 1/1/96 TO
6/30/97 12/31/96
- ---------------------------------------- ---------- ----------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income................. $ 14,140 $ 22,997
Net realized gain (loss) on
investments......................... 133,517 118,654
Net unrealized appreciation
(depreciation) of investments....... 248,340 199,645
---------- ----------
Net increase in net assets resulting
from operations................... 395,997 341,296
---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income................. (5,815) (24,266)
Net realized gains.................... -- (118,654)
---------- ----------
Total distributions................. (5,815) (142,920)
---------- ----------
TRUST SHARE TRANSACTIONS (a)
Proceeds from shares sold............. 381,435 602,423
Value of distributions reinvested..... 5,464 137,288
Cost of shares redeemed............... (21,338) (204,360)
---------- ----------
Net increase from trust share
transactions........................ 365,561 535,351
---------- ----------
Net increase in net assets.......... 755,743 733,727
NET ASSETS
Beginning of period................... 2,160,235 1,426,508
---------- ----------
End of period+........................ $2,915,978 $2,160,235
---------- ----------
---------- ----------
+Includes undistributed net investment
income of.............................. $ 9,687 $ 1,362
---------- ----------
---------- ----------
(a)TRUST SHARES ISSUED AND REDEEMED
Sold.................................. 19,450 34,030
Issued for distributions reinvested... 291 7,503
Redeemed.............................. (1,087) (11,252)
---------- ----------
Net increase in trust shares.......... 18,654 30,281
---------- ----------
---------- ----------
</TABLE>
See notes to financial statements
22
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------
INSURED
HIGH YIELD FUND TAX EXEMPT FUND
------------------------ ------------------------
1/1/97 TO 1/1/96 TO 1/1/97 TO 1/1/96 TO
6/30/97 12/31/96 6/30/97 12/31/96
- ---------------------------------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income................. $ 775,753 $ 1,513,831 $ 370,608 $ 722,050
Net realized gain (loss) on
investments......................... (123,060) (139,925) 8,581 120,145
Net unrealized appreciation
(depreciation) of investments....... 148,055 707,493 51,068 (215,936)
----------- ----------- ----------- -----------
Net increase in net assets resulting
from operations................... 800,748 2,081,399 430,257 626,259
----------- ----------- ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income................. (753,374) (1,455,005) (369,971) (722,005)
Net realized gains.................... -- -- -- (120,145)
----------- ----------- ----------- -----------
Total distributions................. (753,374) (1,455,005) (369,971) (842,150)
----------- ----------- ----------- -----------
TRUST SHARE TRANSACTIONS (a)
Proceeds from shares sold............. 2,202,363 2,505,007 817,425 3,948,019
Value of distributions reinvested..... 281,265 618,840 178,639 520,606
Cost of shares redeemed............... (1,324,134) (2,649,367) (883,397) (2,186,795)
----------- ----------- ----------- -----------
Net increase from trust share
transactions........................ 1,159,494 474,480 112,667 2,281,830
----------- ----------- ----------- -----------
Net increase in net assets.......... 1,206,868 1,100,874 172,953 2,065,939
NET ASSETS
Beginning of period................... 16,773,320 15,672,446 15,408,429 13,342,490
----------- ----------- ----------- -----------
End of period+........................ $17,980,188 $16,773,320 $15,581,382 $15,408,429
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
+Includes undistributed net investment
income of............................. $ 176,308 $ 153,929 $ 2,635 $ 1,998
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
(a)TRUST SHARES ISSUED AND REDEEMED
Sold.................................. 280,632 322,959 58,963 286,274
Issued for distributions reinvested... 36,022 79,911 13,013 37,872
Redeemed.............................. (169,299) (341,193) (64,277) (159,446)
----------- ----------- ----------- -----------
Net increase in trust shares.......... 147,355 61,677 7,699 164,700
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
</TABLE>
See notes to financial statements
23
<PAGE>
STATEMENT OF OPERATIONS
EXECUTIVE INVESTORS TRUST
Six Months Ended June 30, 1997
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
BLUE CHIP HIGH YIELD INSURED TAX
FUND FUND EXEMPT FUND
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME
Income:
Interest............................. $ 5,579 $ 831,568 $ 427,721
Dividends (Note 1F).................. 18,023 33,856 --
Consent fees......................... -- 18,025 --
--------- ---------- -----------
Total income........................... 23,602 883,449 427,721
--------- ---------- -----------
Expenses (Notes 1 and 3):
Advisory fee......................... 12,640 86,845 76,128
Distribution plan expenses........... 6,309 43,423 37,661
Shareholder servicing costs.......... 1,993 12,144 4,067
Professional fees.................... 1,309 7,646 6,678
Custodian fees....................... 2,469 2,678 2,363
Reports and notices to
shareholders....................... 170 951 315
Other expenses....................... 1,676 7,513 3,823
--------- ---------- -----------
Total expenses......................... 26,566 161,200 131,035
Less: Expenses waived or assumed....... (16,093) (52,108) (72,159)
Custodian fees paid indirectly.... (1,011) (1,396) (1,763)
--------- ---------- -----------
Net expenses........................... 9,462 107,696 57,113
--------- ---------- -----------
Net investment income.................. 14,140 775,753 370,608
--------- ---------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS (Note 2):
Net realized gain (loss) on
investments.......................... 133,517 (123,060) 8,581
Net unrealized appreciation of
investments.......................... 248,340 148,055 51,068
--------- ---------- -----------
Net gain on investments................ 381,857 24,995 59,649
--------- ---------- -----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS...................... $ 395,997 $ 800,748 $ 430,257
--------- ---------- -----------
--------- ---------- -----------
</TABLE>
See notes to financial statements
24
<PAGE>
NOTES TO FINANCIAL STATEMENTS
EXECUTIVE INVESTORS TRUST
1. SIGNIFICANT ACCOUNTING POLICIES--The Trust, a Massachusetts business trust,
is registered under the Investment Company Act of 1940 (the "1940 Act") as a
diversified, open-end management investment company. The Trust consists of
unlimited shares of beneficial interest of the Blue Chip Fund, the High Yield
Fund, and the Insured Tax Exempt Fund, and accounts separately for the assets,
liabilities and operations of each Fund. The objective of each Fund is as
follows:
BLUE CHIP FUND seeks high total investment return consistent with the
preservation of capital.
HIGH YIELD FUND primarily seeks high current income and secondarily seeks
capital appreciation.
INSURED TAX EXEMPT FUND seeks to provide a high level of interest income which
is exempt from federal income tax and is not an item of tax preference for
purposes of the federal alternative minimum tax.
A. Security Valuation--Except as provided below, a security listed or traded on
an exchange or the Nasdaq Stock Market is valued at its last sale price on the
exchange where the security is principally traded, and lacking any sales, the
security is valued at the mean between the closing bid and asked prices. Each
security traded in the over-the-counter market (including securities listed on
exchanges whose primary market is believed to be over-the-counter) is valued at
the mean between the last bid and asked prices based upon quotes furnished by a
market maker for such securities. Securities for which market quotations are not
readily available and other assets are valued on a consistent basis at fair
value as determined in good faith by or under the direction of the Trust's
officers in a manner specifically authorized by the trustees.
Securities in the Blue Chip and High Yield Funds may also be priced by a pricing
service which uses quotations obtained from investment dealers or brokers, and
other available information in determining value.
The municipal bonds in which the Insured Tax Exempt Fund invests are traded
primarily in the over-the-counter markets. Such securities are valued daily on
the basis of valuations provided by a pricing service approved by the Board of
Trustees. The pricing service considers security type, rating, market condition
and yield data, as well as market quotations and prices provided by market
makers in determining value. "When Issued Securities" are reflected in the
assets of the Fund as of the date the securities are purchased.
The municipal bonds held by the Insured Tax Exempt Fund are insured as to
payment of principal and interest by the issuer or under insurance policies
written by independent insurance companies. It is the intention of the Fund to
retain any insured securities which are in default or in significant risk of
default and to place a value on the defaulted securities based on the value of
similar securities which are not in default. The Fund may invest up to 20% of
its assets in portfolio securities not covered by the insurance feature.
B. Federal Income Taxes--No provision has been made for federal income taxes on
net income or capital gains since it is the policy of the Trust to continue to
comply with the special provisions of the Internal Revenue Code applicable to
investment companies and to make sufficient distributions of income and capital
gains (in excess of any available capital loss carryovers), to relieve it from
all, or substantially all, federal income taxes. At June 30, 1997, the High
Yield Fund had capital loss carryovers of $4,971,915 of which $3,364,392 expires
in 1998, $1,286,892 expires in 1999, $211,168 expires in 2003 and $109,463
expires in 2004.
C. Expense Allocation--Expenses directly charged or attributable to a Fund are
paid from the assets of that Fund. General expenses of the Trust are allocated
among and charged to the assets of each Fund on a fair and equitable basis,
which may be based on the relative assets of each Fund or the nature of the
services performed and relative applicability to each Fund.
25
<PAGE>
NOTES TO FINANCIAL STATEMENTS
EXECUTIVE INVESTORS TRUST
D. Distributions to Shareholders--Dividends from net investment income to the
shareholders of the High Yield Fund and the Insured Tax Exempt Fund are
generally declared daily and paid monthly. Dividends from net investment income
of the Blue Chip Fund are generally declared and paid quarterly. Distributions
from net realized capital gains, if any, are declared and paid annually.
Income dividends and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
capital loss carryforwards and post October losses.
E. Use of Estimates--The preparation of the financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenue and expense during the reporting period. Actual results could differ
from those estimates.
F. Other--Security transactions are accounted for on the date the securities are
purchased or sold. Cost is determined, and gains and losses are based, on the
identified cost basis for both financial statement and federal income tax
purposes. Interest income and estimated expenses are accrued daily. Dividend
income is recorded on the ex-dividend date. Shares of stock received in lieu of
cash dividends on certain preferred stock holdings are recognized as dividend
income and recorded at the market value of the shares received. During the six
months ended June 30, 1997, the High Yield Fund recognized $17,919 of dividend
income from these taxable "pay in kind" distributions. The Funds' custodian has
provided credits in the amount of $4,170 against custodian charges based on the
uninvested cash balances of the Funds.
2. SECURITY TRANSACTIONS--For the six months ended June 30, 1997, purchases and
sales of securities other than short-term tax exempt investments and short-term
corporate notes, were as follows:
<TABLE>
<CAPTION>
BLUE CHIP HIGH YIELD INSURED TAX
FUND FUND EXEMPT FUND
--------- ---------- -----------
<S> <C> <C> <C>
Cost of purchases...................... $1,201,233 $4,417,066 $ 8,802,461
--------- ---------- -----------
--------- ---------- -----------
Proceeds of sales...................... $ 858,843 $3,320,615 $ 8,350,237
--------- ---------- -----------
--------- ---------- -----------
</TABLE>
At June 30, 1997, aggregate cost and net unrealized appreciation of securities
for federal income tax purposes were as follows:
<TABLE>
<CAPTION>
BLUE CHIP HIGH YIELD INSURED TAX
FUND FUND EXEMPT FUND
--------- ---------- -----------
<S> <C> <C> <C>
Aggregate cost......................... $2,111,100 $16,689,867 $14,684,587
--------- ---------- -----------
--------- ---------- -----------
Gross unrealized appreciation.......... $ 764,331 $1,132,919 $ 1,010,835
Gross unrealized depreciation.......... 18,271 183,448 4,977
--------- ---------- -----------
Net unrealized appreciation............ $ 746,060 $ 949,471 $ 1,005,858
--------- ---------- -----------
--------- ---------- -----------
</TABLE>
26
<PAGE>
3. ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES--Certain officers and
trustees of the Trust are officers and directors of its investment adviser,
Executive Investors Management Company, Inc. ("EIMCO"), its underwriter,
Executive Investors Corporation ("EIC"), its transfer agent, Administrative Data
Management Corp. ("ADM") and/or First Financial Savings Bank, S.L.A. ("FFS"),
custodian of the Trust's Individual Retirement Accounts. Officers and trustees
received no remuneration from the Trust for serving in such capacities. Their
remuneration (together with certain other expenses of the Trust) is paid by
EIMCO or First Investors Corporation ("FIC"), an affiliated dealer.
The Investment Advisory Agreement provides as compensation to EIMCO an annual
fee, payable monthly, at the rate of 1% on the first $200 million of each Fund's
average daily net assets, .75% on the next $300 million, declining by .03% on
each $250 million thereafter, down to .66% on average daily net assets over $1
billion. The total advisory fees earned by EIMCO from all Funds was $175,613 of
which $109,999 was waived. In addition, expenses of $12,799 were assumed by
EIMCO.
For the six months ended June 30, 1997, EIC, as underwriter of the Trust,
received $14,362 in commissions from the sale of Trust shares, after allowing
$90,659 to other dealers. Shareholder servicing costs included $14,476 in
transfer agent fees accrued to ADM and $1,458 in IRA custodian fees accrued to
FFS.
Pursuant to a Distribution Plan adopted under Rule 12b-1 of the 1940 Act, each
Fund is authorized to pay a fee equal to .50% of its average net assets on an
annualized basis each fiscal year, payable quarterly. The fee consists of a
distribution fee and a service fee. The service fee is paid for the ongoing
servicing of clients who are shareholders of that Fund. Total distribution plan
fees accrued to EIC amounted to $87,393 (of which $17,562 was waived).
4. RULE 144A SECURITIES--Under Rule 144A, certain restricted securities are
exempt from the registration requirements of the Securities Act of 1933 and may
only be resold to qualified institutional investors. At June 30, 1997, the Blue
Chip and High Yield Funds held one and eleven 144A securities, respectively,
with aggregate values of $11,076 and $2,303,752, respectively. These securities
represent .4% and 12.8% of the respective Fund's net assets and are valued as
set forth in Note 1A.
5. CONCENTRATION OF CREDIT RISK--The High Yield Fund's investment in high yield
securities, whether rated or unrated, may be considered speculative and subject
to greater market fluctuations and risk of loss of income and principal than
lower yielding, higher rated, fixed income securities. The risk of loss due to
default by the issuer may be significantly greater for the holders of high
yielding securities, because such securities are generally unsecured and are
often subordinated to other creditors of the issuer.
27
<PAGE>
FINANCIAL HIGHLIGHTS
EXECUTIVE INVESTORS TRUST
The following table sets forth the per share operating performance data for a
share of beneficial interest outstanding, total return, ratios to average net
assets and other supplemental data for each period indicated.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
--------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
NET ASSET ---------------------------------------- FROM
VALUE NET REALIZED -------------------
--------- NET AND UNREALIZED TOTAL FROM NET NET
BEGINNING INVESTMENT GAIN (LOSS) ON INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
BLUE CHIP FUND
1992................... $ 13.49 $ .25 $ .30 $ .55 $ .26 $ -- $ .26
1993................... 13.78 .23 .88 1.11 .23 .59 .82
1994................... 14.07 .24 (.41) (.17) .22 .93 1.15
1995................... 12.75 .30 4.30 4.60 .29 .74 1.03
1996................... 16.32 .22 3.13 3.35 .24 1.07 1.31
1/1/97 to 6/30/97...... 18.36 .10 2.98 3.08 .05 -- .05
- --------------------------------------------------------------------------------------------------------------
HIGH YIELD FUND
1992................... $ 7.10 $ .80 $ .29 $ 1.09 $ .76 $ -- $ .76
1993................... 7.43 .72 .50 1.22 .76 -- .76
1994................... 7.89 .70 (.87) (.17) .74 -- .74
1995................... 6.98 .70 .58 1.28 .67 -- .67
1996................... 7.59 .72 .28 1.00 .70 -- .70
1/1/97 to 6/30/97...... 7.89 .35 .01 .36 .34 -- .34
- --------------------------------------------------------------------------------------------------------------
INSURED TAX EXEMPT FUND
1992................... $ 12.39 $ .74 $ .59 $ 1.33 $ .72 $ .17 $ .89
1993................... 12.83 .71 1.27 1.98 .72 .32 1.04
1994................... 13.77 .68 (1.23) (.55) .69 -- .69
1995................... 12.53 .72 1.80 2.52 .73 .28 1.01
1996................... 14.04 .66 (.10) .56 .67 .11 .78
1/1/97 to 6/30/97...... 13.82 .34 .06 .40 .34 -- .34
- --------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Annualized
* Calculated without sales charges.
+ Net of expenses waived or assumed (Note 3).
++ Average commission rate (per share of security) as required by amended
disclosure requirements effective in 1996.
See notes to financial statements
28
<PAGE>
The following table sets forth the per share operating performance data for a
share of beneficial interest outstanding, total return, ratios to average net
assets and other supplemental data for each period indicated.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
------------------------------------------------------------------------------------
---------
RATIO TO AVERAGE NET RATIO TO AVERAGE NET ASSETS
BEFORE
ASSETS+ EXPENSES WAIVED OR ASSUMED
NET ASSET ------------------------- -----------------------------
VALUE TOTAL NET NET
--------- RETURN NET ASSETS INVESTMENT INVESTMENT
END * END OF PERIOD EXPENSES INCOME EXPENSES INCOME
OF PERIOD (%) (IN THOUSANDS) (%) (%) (%) (%)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
BLUE CHIP FUND
1992................... $ 13.78 4.13 $ 786 .41 1.95 2.55 (.19)
1993................... 14.07 8.13 956 .50 1.63 2.30 (.17)
1994................... 12.75 (1.21) 1,041 .50 1.82 2.54 (.22)
1995................... 16.32 36.30 1,427 .50 1.99 2.20 .29
1996................... 18.36 20.62 2,160 .75 1.33 2.28 (.20)
1/1/97 to 6/30/97...... 21.39 16.78 2,916 .75(a) 1.12(a) 2.10(a) (.23)(a)
- ----------------------------------------------------------------------------------------------------------------------
HIGH YIELD FUND
1992................... $ 7.43 16.89 $ 10,491 1.29 10.72 2.10 9.90
1993................... 7.89 17.04 14,231 1.34 9.49 1.95 8.88
1994................... 6.98 (2.32) 15,142 1.33 9.45 1.88 8.90
1995................... 7.59 19.08 15,672 1.35 9.52 1.90 8.97
1996................... 7.89 13.69 16,773 1.22 9.38 1.82 8.78
1/1/97 to 6/30/97...... 7.91 4.72 17,980 1.26(a) 8.93(a) 1.86(a) 8.33(a)
- ----------------------------------------------------------------------------------------------------------------------
INSURED TAX EXEMPT FUND
1992................... $ 12.83 11.03 $ 5,875 .47 5.88 1.89 4.47
1993................... 13.77 15.74 9,447 .50 5.29 1.68 4.11
1994................... 12.53 (3.95) 10,363 .50 5.39 1.80 4.09
1995................... 14.04 20.53 13,342 .50 5.35 1.74 4.11
1996................... 13.82 4.11 15,408 .75 4.85 1.71 3.89
1/1/97 to 6/30/97...... 13.88 2.91 15,581 .75(a) 4.87(a) 1.72(a) 3.90(a)
- ----------------------------------------------------------------------------------------------------------------------
<CAPTION>
PORTFOLIO AVERAGE
TURNOVER COMMISSION
RATE RATE
(%) ++
- -----------------------------------------------------------
<S> <C><C> <C>
BLUE CHIP FUND
1992................... 50 $ --
1993................... 47 --
1994................... 89 --
1995................... 33 --
1996................... 50 .0689
1/1/97 to 6/30/97...... 39 .0668
- -----------------------------------------------------------------------
HIGH YIELD FUND
1992................... 83 $ --
1993................... 89 --
1994................... 53 --
1995................... 69 --
1996................... 27 --
1/1/97 to 6/30/97...... 20 --
- -----------------------------------------------------------------------------------
INSURED TAX EXEMPT FUND
1992................... 131 $ --
1993................... 97 --
1994................... 215 --
1995................... 147 --
1996................... 116 --
1/1/97 to 6/30/97...... 57 --
- -----------------------------------------------------------------------------------------------
</TABLE>
(a) Annualized
* Calculated without sales charges.
+ Net of expenses waived or assumed (Note 3).
++ Average commission rate (per share of security) as required by amended
disclosure requirements effective in 1996.
See notes to financial statements
29
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Shareholders and Trustees of
Executive Investors Trust
We have audited the accompanying statement of assets and liabilities, including
the portfolios of investments, of the Blue Chip, High Yield and Insured Tax
Exempt Funds (comprising Executive Investors Trust), as of June 30, 1997, the
related statement of operations for the six months then ended, the statement of
changes in net assets for the six months ended June 30, 1997 and the year ended
December 31, 1996, and financial highlights for each of the periods indicated
thereon. These financial statements and financial highlights are the
responsibility of the Trust's management. 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 June
30, 1997, 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 the
Blue Chip, High Yield and Tax Exempt Funds at June 30, 1997, and the results of
their operations, changes in their net assets and financial highlights for the
respective periods presented, in conformity with generally accepted accounting
principles.
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
July 31, 1997
30
<PAGE>
EXECUTIVE INVESTORS TRUST
TRUSTEES
- -------------------------------------------
JAMES J. COY (Emeritus)
ROGER L. GRAYSON
GLENN O. HEAD
KATHRYN S. HEAD
REX R. REED
HERBERT RUBINSTEIN
NANCY S. SCHAENEN
JAMES M. SRYGLEY
JOHN T. SULLIVAN
ROBERT F. WENTWORTH
OFFICERS
- -------------------------------------------
GLENN O. HEAD
President
GEORGE V. GANTER
Vice President
PATRICIA D. POITRA
Vice President
CLARK D. WAGNER
Vice President
CONCETTA DURSO
Vice President and Secretary
JOSEPH I. BENEDEK
Treasurer
CAROL LERNER BROWN
Assistant Secretary
GREGORY R. KINGSTON
Assistant Treasurer
MARK S. SPENCER
Assistant Treasurer
SHAREHOLDER INFORMATION
- -------------------------------------------
INVESTMENT ADVISER
EXECUTIVE INVESTORS
MANAGEMENT COMPANY, INC.
95 Wall Street
New York, NY 10005
UNDERWRITER
EXECUTIVE INVESTORS CORPORATION
95 Wall Street
New York, NY 10005
CUSTODIAN
THE BANK OF NEW YORK
48 Wall Street
New York, NY 10286
TRANSFER AGENT
ADMINISTRATIVE DATA
MANAGEMENT CORP.
581 Main Street
Woodbridge, NJ 07095-1198
LEGAL COUNSEL
KIRKPATRICK & LOCKHART LLP
1800 Massachusetts Avenue, N.W.
Washington, DC 20036
AUDITORS
TAIT, WELLER & BAKER
Two Penn Center Plaza
Philadelphia, PA 19102
It is the Trust's practice to mail only one copy of its annual and semi-annual
reports to any address at which more than one shareholder with the same last
name has indicated that mail is to be delivered. Additional copies of the
reports will be mailed if requested by any shareholder in writing or by calling
800-423-4026. The Trust will ensure that separate reports are sent to any
shareholder who subsequently changes his or her mailing address.
This report is authorized for distribution only to existing shareholders, and,
if given to prospective shareholders, must be accompanied or preceded by the
Trust's prospectus.
31
<PAGE>
EXECUTIVE
INVESTORS
TRUST
Blue Chip Fund
High Yield Fund
Insured Tax Exempt Fund
SEMI-
ANNUAL
REPORT
JUNE 30, 1997
Vertically reading from bottom to top in the center of the page the words
"EXECUTIVE INVESTORS" appear.
The following appears in a box to the left of the above language:
EXECUTIVE INVESTORS
NEED SERVICE?
If you have questions about your account...or would like information regarding
other products or services...please contact your representative or call our
Shareholder Services Department at...
(800) 423-4026
The following appears in a box within the above box:
Our business is...putting investors first
The following appears on the bottom lefthand side:
EIHY-107
