SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Registration No. 33-2659
Pre-Effective Amendment No.
Post-Effective Amendment No. 25
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
1940 Act File No. 811-4556
Amendment No. 27
(Check appropriate box or boxes.)
IDEX SERIES FUND
(Exact Name of Registrant as Specified in Charter)
201 Highland Avenue, Largo, Florida 33770-2957
(Address of Principal Executive Offices) (Zip Code)
- -------------------------------------------------------------------------------
Registrant's Telephone Number, including Area Code: (813) 585-6565
John Hurley, P.O. Box 5068, Clearwater, Florida 34618-5068
(Name and Address of Agent for Service)
- -------------------------------------------------------------------------------
Approximate date of proposed public offering: It is proposed that this filing
will become effective:
/ / 60 days after filing pursuant to paragraph (a) (1) of Rule 485.
/ / 75 days after filing pursuant to paragraph (a) (2) of Rule 485.
/ / On (date) pursuant to paragraph (a) (1) of Rule 485.
/ / On (date) pursuant to paragraph (a) (2) of Rule 485.
/ / Immediately upon filing pursuant to paragraph (b) of Rule 485.
/X/ On February 1, 1997 pursuant to paragraph (b) of Rule 485.
If appropriate, check the following box:
/ / This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Registrant has registered an indefinite number of shares under the Securities
Act of 1933 pursuant to Rule 24f-2(a) and filed a Rule 24f-2 Notice on November
29, 1996 for the fiscal year ended September 30, 1996 and on December 30, 1996
for the one month period ended October 31, 1996.
as filed January 31, 1997
<PAGE>
IDEX SERIES FUND
Cross Reference Sheet
Between Prospectus and Statement of
Additional Information and Form N-1A Item
Form N-1A Item Caption
Part A Prospectus
1. Cover Page Cover Page
2. Synopsis The IDEX Series - Fund Introduction to the
Portfolios; Summary of Expenses
3. Condensed Financial Financial Highlights
Information
4. General Description of The IDEX Series - Fund Introduction to the
Registrant Portfolios; Securities in Which the
Portfolios Invest; How the Portfolios
Invest; Additional Risk Factors;
Miscellaneous Information
5. Management of Fund Investment Advisory and Other Services;
Miscellaneous Information
5A. Management's Discussion Not Applicable
of Fund Performance
6. Capital Stock and Other Shareholder Information and Instructions -
Securities How to Buy Shares; Distributions and
Taxes; Miscellaneous Information
7. Purchase of Securities Alternative Purchase Arrangements;
Being Offered Shareholder Information and Instructions -
Opening an Account; Shareholder
Information and Instructions - How to Buy
Shares; Shareholder Information and
Instructions; How to Exchange Shares;
Shareholder Information and Instructions
- Other Information; Investment Advisory
and Other Services
8. Redemption or Repurchase Shareholder Information and Instructions -
How to Redeem (Sell) Shares
9. Pending Legal Proceedings Not Applicable
Part B Statement of Additional
Information
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and Miscellaneous Information
History
<PAGE>
13. Investment Objectives and Investment Objectives; Investment
Policies Restrictions; Policies and Practices; Other
Policies and Practices of the Portfolio
14. Management of the Fund Trustees and Officers
15. Control Persons and Principal Shareholders
Principal Holders of
Securities
16. Investment Advisory and Investment Advisory and Other Services;
Other Services Administrative Services; Custodian, Transfer
Agent and Other Affiliates
17. Brokerage Allocation and Portfolio Transactions and Brokerage
Other Practices
18. Capital Stock and Other Miscellaneous Information
Securities
19. Purchase, Redemption and Purchase of Shares; Distribution Plans; Net
Pricing of Securities Being Asset Value Determination; Dividends and
Offered Other Distributions; Shareholder Accounts;
Retirement Plans; Redemption of Shares
20. Tax Status Taxes
21. Underwriter Distributor
22. Calculation of Performance Performance Information
Data
23. Financial Statements Financial Statements
<PAGE>
IDEX SERIES FUND
201 Highland Avenue, Largo, FL 33770-2597
Customer Service: (800) 851-9777
Prospectus dated February 1, 1997
This Prospectus is a legal document provided to you, the investor, which sets
forth concise information about the IDEX Series Fund that should be considered
carefully before you invest in a Portfolio of the Fund. Additional and more
detailed information about each Portfolio is contained in the Statement of
Additional Information (the "SAI"), which is incorporated by reference in this
Prospectus. You may obtain a copy of the current SAI, dated February 1, 1997, at
no charge by calling or writing IDEX. You should retain this Prospectus for
future reference.
The investment objective of each Portfolio is set forth on the following pages
of this Prospectus. There can be, of course, no assurance that a Portfolio will
achieve its investment objective. For further information about the Portfolios,
please read The IDEX Series Fund - Introduction to the Portfolios^; Securities
in Which the Portfolios Invest; How the Portfolios Invest; and Additional Risk
Factors.
PORTFOLIO SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY, THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY
OTHER AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION ("SEC") OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
This Prospectus does not constitute an offer to sell securities in any state to
any person to whom it is unlawful to make an offer in such state.
<PAGE>
TABLE OF CONTENTS
The IDEX Series Fund..........................................................1
Introduction to the Portfolios................................................1
Summary of Expenses ......................................................1
Financial Highlights .....................................................1
Aggressive Growth Portfolio..........................................2
International Equity Portfolio.......................................5
Capital Appreciation Portfolio.......................................7
Global Portfolio.....................................................10
Growth Portfolio.....................................................13
C.A.S.E. Portfolio...................................................16
Value Equity Portfolio...............................................19
Strategic Total Return Portfolio (formerly Equity-Income Portfolio)..21
Tactical Asset Allocation Portfolio..................................24
Balanced Portfolio...................................................27
Flexible Income Portfolio............................................30
Income Plus Portfolio................................................33
Tax-Exempt Portfolio.................................................36
Performance/Total Return......................................................41
Securities in Which the Portfolios Invest ....................................42
How the Portfolios Invest ....................................................46
Additional Risk Factors ......................................................49
Investment Advisory and Other Services .......................................52
Distributor and Distribution and Service Plans ...............................60
Miscellaneous Information ....................................................60
Distributions and Taxes ......................................................62
Shareholder Information and Instructions .....................................65
Brief Explanation of Rating Categories................................Appendix A
Glossary of Investment Terms..........................................Appendix B
i
<PAGE>
THE IDEX SERIES FUND
^
INTRODUCTION TO THE PORTFOLIOS
The IDEX Series Fund consists of thirteen Portfolios. Each Portfolio is a
separate series of IDEX Series Fund (formerly IDEX II Series Fund) (the "Fund"),
an open-end management investment company offering a selection of separate
investment portfolios. The Fund is registered under the Investment Company Act
of 1940 (the "1940 Act"). All Portfolios ^ of the Fund are diversified except
for the Capital Appreciation Portfolio ^. The Capital Appreciation Portfolio is
^ non-diversified. See How the Portfolios Invest - Diversification. ^ Each
Portfolio has its own distinct investment objective and policies^, which are
summarized in the following sections. The Portfolios are generally listed in
order from those with higher to lower risk/reward characteristics. Portfolios
with higher risk/reward characteristics may experience greater volatility in net
asset value changes and total return. The summaries should be read in
conjunction with the sections called: Securities in Which the Portfolios Invest;
How the Portfolios Invest; and Additional Risk Factors, which provide more
information about the Portfolios' investments, practices and risks. Either Idex
Management, Inc. or InterSecurities, Inc. serves as investment adviser to each
of the Portfolios. All investments involve risks. For information on specific
Portfolio investment risks, see Additional Risk Factors. For detailed
information about how to purchase, redeem or exchange shares, see Shareholder
Information and Instructions.
Each Portfolio may change its investment objective without shareholder approval.
Unless otherwise noted, a Portfolio may also change its investment policies
without shareholder approval. ^ There can be no assurance that a Portfolio will
achieve its investment objective.
^ SUMMARY OF EXPENSES
Before investing in a Portfolio of IDEX Series Fund, please read this section
carefully to understand the cost of investing. When you buy shares of any of the
Portfolios, you will incur certain expenses. The section titled Shareholder
Transaction Expenses shows the expenses involved in owning shares of each class
of the Portfolios. The section titled Examples shows the expenses you might pay
when making a hypothetical $1,000 investment. Class T shares of the Growth
Portfolio are not available for sale to new investors.
^ FINANCIAL HIGHLIGHTS
Each Financial Highlights table shows the actual earnings, capital gains or
losses, and expenses of a share of each class in a Portfolio. On October 1,
1996, the Fund changed its fiscal year end from September 30 to October 31. The
information contained in the tables for each fiscal year through October 31,
1996 has been audited by ^ Price Waterhouse LLP, independent accountants, whose
report is incorporated by reference into the SAI. ^ All years ^ have been
audited unless otherwise noted. No financial information is shown for the Value
Equity and International Equity Portfolios for the fiscal year ended October 31,
1996 as those Portfolios had not yet commenced operations at that time. The SAI
is incorporated by reference in this Prospectus. You may obtain it without
charge by calling or writing the Fund. Further information about performance of
the Fund Portfolios is contained in the Fund's Annual Report to shareholders,
which you may also obtain without charge by calling or writing to the Fund.
1
<PAGE>
AGGRESSIVE GROWTH PORTFOLIO
Objective: Long-term capital appreciation.
INVESTMENT FOCUS: The Aggressive Growth Portfolio is a diversified, actively
managed portfolio primarily composed of equity securities traded on domestic
stock exchanges or in the over-the-counter market. These securities include
common or preferred stocks, or securities convertible into or exchangeable for
equity securities, including warrants and rights.
INVESTOR PROFILE: For the investor who aggressively seeks capital growth, and
who can tolerate volatility in the value of an investment.
PRIMARY INVESTMENT PRACTICES: The Portfolio may engage in leveraging and options
and futures transactions, which are considered speculative and which may cause
the Portfolio's net asset value to be more volatile than the net asset value of
a fund which does not engage in these activities.
Except during temporary defensive periods, the Portfolio invests at least 85% of
its net assets in equity securities. The sub-adviser may pick stocks of
developing companies; older companies that appear to be entering a new stage of
growth due to management changes or development of new technologies, products or
markets; or companies providing products or services with a high unit volume
growth rate.
In order to afford the flexibility to take advantage of new opportunities for
investments in accordance with its investment objective, the Portfolio may hold
up to 15% of its net assets in money market instruments and repurchase
agreements and in excess of that amount (up to 100% of its assets) during
temporary defensive periods. This amount may be higher than that maintained by
other funds with similar investment objectives. Under those circumstances,
investment income may constitute a proportionately larger amount of the return
realized by the Portfolio.
SUB-ADVISER: Fred Alger Management, Inc.
2
<PAGE>
<TABLE>
<CAPTION>
AGGRESSIVE GROWTH PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
==================================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None
Redemption Fees ^(a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) ^(b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00%
12b-1 ^ Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (net of expense reimbursements and/or fee waivers^) (c) 0.50% 0.50% 0.50%
----- ----- -----
Total Operating Expenses (net of expense reimbursements and/or fee waivers^) (c) 1.85% 2.50% 2.40%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $73 $110 $150 $260
B $75 $108 $143 $267
C $24 $75 $128 $274
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $73 $110 $150 $260
B $25 $78 $133 $267
C $24 $75 $128 $274
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. The percentages shown are for the fiscal year ended September 30,
1996.
</TABLE>
The purpose of the Examples shown in the ^ Summary of Expenses ^ are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
3
<PAGE>
<TABLE>
<CAPTION>
AGGRESSIVE GROWTH PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $15.75 $(0.01) $(0.04) $(0.05) -- -- -- $15.70
9/30/96 (14) $17.68 $(0.15) $(0.76) $(0.91) -- $(1.02) $(1.02) $15.75
9/30/95 $10.00 $(0.14) $7.82 $7.68 -- -- -- $17.68
CLASS B
10/31/96 (2) $15.63 $(0.01) $(0.04) $(0.05) -- -- -- $15.58
9/30/96 (14) $17.64 $(0.23) $(0.76) $(0.99) -- $(1.02) $(1.02) $15.63
CLASS C
10/31/96 (2) $15.65 $(0.01) $(0.04) $(0.05) -- -- -- $15.60
9/30/96 (14) $17.64 $(0.21) $(0.76) $(0.97) -- $(1.02) $(1.02) $15.65
9/30/95 $10.00 $(0.18) $7.82 $7.64 -- -- -- $17.64
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) (0.32)% $21,938 1.85% 1.85% 2.62% (1.06)% 9.40% $0.0662
9/30/96 (4.91)% $22,078 1.85% 1.85% 2.60% (1.15)% 127.49% $0.0715
9/30/95 76.80% $16,747 2.85% 2.85% 3.35% (2.39)% 88.28% --
CLASS B
10/31/96 (2) (0.32)% $1,992 2.50% 2.50% 3.27% (1.71)% 9.40% $0.0662
9/30/96 (5.33)% $1,800 2.50% 2.50% 3.25% (1.80)% 127.49% $0.0715
CLASS C
10/31/96 (2) (0.32)% $2,129 2.40% 2.40% 3.17% (1.62)% 9.40% $.0662
9/30/96 (5.22)% $2,250 2.40% 2.40% 3.15% (1.70)% 127.49% $.0715
9/30/95 76.40% $1,736 3.40% 3.40% 3.91% (2.94)% 88.28% --
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
4
<PAGE>
INTERNATIONAL EQUITY PORTFOLIO
OBJECTIVE: Long-term growth of capital.
INVESTMENT FOCUS: The International Equity Portfolio invests primarily in the
common stock and other equity securities of foreign issuers traded on overseas
exchanges and in foreign over-the-counter markets.
INVESTOR PROFILE: For the investor who seeks long-term growth of capital through
investments in foreign securities. The investor should also be able to tolerate
the significant risk factors associated with foreign investing.
PRIMARY INVESTMENT PRACTICES: The Portfolio invests primarily in common stock
and other equity securities, including preferred stocks, convertible securities,
warrants or rights. The Portfolio may also invest in fixed-income instruments
when its sub-advisers deem appropriate.
Daily cash inflows attributable to shares purchased by investors will be divided
equally each day between its sub-advisers, and each portion will thereafter be
managed separately by each sub-adviser.
Under normal circumstances, the Portfolio will seek to be invested in a minimum
of 50 stocks of issuers from approximately 15-25 countries, based on (i) the
country in which an issuer is organized; (ii) the country from which an issuer
derives at least 50% of its revenues or profits; or (iii) the principal trading
market for the issuer's securities. The Portfolio will not be invested in
issuers of fewer than twelve countries other than the U.S. at any time. (For
this purpose, ADRs, European Depositary Receipts ("EDRs"), and Global Depositary
Receipts ("GDRs") will be considered to be issued by the issuer of the
securities underlying the receipt.) Typically, the Portfolio will be invested
broadly, not only in the larger stock markets of the United Kingdom, Continental
Europe, Japan and the Far East, but also, to a lesser extent, in the smaller
stock markets of Asia, Europe and Latin America.
At any time, overseas economies may not be moving in the same direction and will
be subject to substantially different fiscal and monetary policies. These
provide situations the Portfolio will aim to exploit. The Portfolio will aim to
add value through active asset allocation among international equity markets.
In selecting investments on behalf of the Portfolio, its sub-adviser GE
Investment Management Incorporated ("GEIM") seeks companies that are expected to
grow faster than relevant markets and whose securities are available at a price
that does not fully reflect the potential growth of those companies. GEIM
typically focuses on companies that possess one or more of a variety of
characteristics, including strong earnings growth relative to price-to-earnings
and price-to-cash earnings ratios, low price-to-book value, strong cash flow,
presence in an industry experiencing strong growth, and high quality management.
In selecting investments on behalf of the Portfolio, its sub-adviser, Scottish
Equitable Investment Management Limited ("Scottish Equitable"), seeks initially
to identify countries where economic growth conditions are favorable (through
analysis of gross domestic product growth rates, inflation, interest rates and
other economic factors), and where stock market valuations generally do not
fully reflect growth potential. Scottish Equitable then seeks to identify within
each of the individual markets, companies whose earnings are undervalued (that
is, where future earnings potential is not reflected in the present share
price). Scottish Equitable will utilize measures of value appropriate to local
market conditions, which may include low price earnings ratios, low price to
book value, low price to cash flow ratios, as well as considering such factors
as industry position and management quality.
Under normal circumstances, the Portfolio will seek to invest as described
above, but may for cash management purposes and to meet operating expenses,
invest a portion of its total assets in cash and/or money market instruments as
described under How the Portfolios Invest below, pending investment in
accordance with its investment objective and policies. During periods when a
sub-adviser believes there are unstable market, economic, political or currency
conditions abroad, the Portfolio may assume a temporary defensive posture and
(i) restrict the securities markets in which its assets will be invested and/or
invest all or a significant portion of its assets in securities of the types
described above issued by companies incorporated in and/or having their
principal activities in the United States, or (ii) without limitation, hold cash
and/or invest in such money market instruments. To the extent that it holds cash
or invests in money market instruments, the Portfolio may not achieve its
investment objective of long-term growth of capital.
SUB-ADVISERS: Scottish Equitable Investment Management Limited and GE Investment
Management Incorporated
5
<PAGE>
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
=============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None
Redemption Fees ^(a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) ^(b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00%
12b-1 ^ Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses ^(c) 0.35% 0.35% 0.35%
----- ----- -----
Total Operating Expenses ^(c) 1.70% 2.35% 2.25%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $71 $106 (d) (d)
B $74 $103 (d) (d)
C $23 $70 (d) (d)
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $71 $106 (d) (d)
B $24 $73 (d) (d)
C $23 $70 (d) (d)
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) Other Expenses shown for the International Equity Portfolio are based
on estimates for the current fiscal year. For the period ended October 31, 1997,
annualized Total Expenses for International Equity Class A, Class B and Class C
are expected to be 3.65%, 4.30% and 4.20%, respectively, absent reimbursement.
(d) Pursuant to applicable rules, Portfolios that have been in operation
for less than 10 months complete only one- and three-year period portions of the
Examples.
</TABLE>
The purpose of the Examples shown in the ^ Summary of Expenses ^ are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
NOTE: No Financial Highlights exist for the International Equity Portfolio, as
that Portfolio commenced operations on February 1, 1997.
<PAGE>
6
<PAGE>
CAPITAL APPRECIATION PORTFOLIO
OBJECTIVE: Long-term growth of capital.
INVESTMENT FOCUS: The Capital Appreciation Portfolio is a nondiversified
Portfolio that pursues its objective by normally investing at least 50% of its
equity assets in securities issued by medium-sized companies. Medium-sized
companies are those whose market capitalizations fall within the range of
companies in the MidCap Index. Companies whose capitalization falls outside this
range after the Portfolio's initial purchase continue to be considered
medium-sized companies for purposes of this policy. As of ^ December 31, 1996,
the MidCap Index included companies with capitalizations between approximately ^
$192 million and ^ $6.5 billion. The range of the MidCap Index is expected to
change on a regular basis. Subject to the above policy, the Portfolio may also
invest in smaller or larger issuers.
INVESTOR PROFILE: For the investor who wants capital growth, ^ and who can
tolerate the greater risks associated with common stock investments.
PRIMARY INVESTMENT PRACTICES: The Portfolio invests in industries and stocks of
companies the sub-adviser believes are experiencing favorable demand for their
products and services, and which operate in a favorable competitive environment
and regulatory climate. The sub-adviser searches especially for stocks with
earnings growth potential that may not be recognized by the market. Some fund
holdings may create incidental income.
Medium-sized companies may suffer more significant losses as well as realize
more substantial growth than larger issuers. Investments in such companies tend
to be more volatile than investments in larger companies, and are somewhat
speculative.
SUB-ADVISER: Janus Capital Corporation
7
<PAGE>
<TABLE>
<CAPTION>
CAPITAL APPRECIATION PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None
Redemption Fees ^(a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) ^(b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00%
12b-1 ^ Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (net of expense reimbursements and/or fee waivers^) (c) 0.50% 0.50% 0.50%
----- ----- -----
Total Operating Expenses (net of expense reimbursements and/or fee waivers^) (c) 1.85% 2.50% 2.40%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $73 $110 $150 $260
B $75 $108 $143 $267
C $24 $75 $128 $274
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $73 $110 $150 $260
B $25 $78 $133 $267
C $24 $75 $128 $274
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. The percentages shown are for the fiscal year ended September 30,
1996.
</TABLE>
The purpose of the Examples shown in the ^ Summary of Expenses ^ are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
8
<PAGE>
<TABLE>
<CAPTION>
CAPITAL APPRECIATION PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $15.75 $(0.02) $(0.24) $(0.26) -- -- -- $15.49
9/30/96 (15) $13.54 $0.06 $3.04 $3.10 $(0.07) $(0.82) $(0.89) $15.75
9/30/95 $10.00 $(0.03) $3.57 $3.54 -- -- -- $13.54
CLASS B
10/31/96 (2) $15.69 $(0.03) $(0.24) $(0.27) -- -- -- $15.42
9/30/96 $13.49 $(0.02) $3.04 $3.02 -- $(0.82) $(0.82) $15.69
CLASS C
10/31/96 (2) $15.70 $(0.03) $(0.24) $(0.27) -- -- -- $15.43
9/30/96 (15) $13.49 -- $3.04 $3.04 $(0.01) $(0.82) $(0.83) $15.70
9/30/95 $10.00 $(0.08) $3.57 $3.49 -- -- -- $13.49
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) (1.59)% $19,350 1.85% 1.85% 2.48% (1.41)% 10.11% $0.0340
9/30/96 24.35% $18,713 1.85% 1.85% 2.72% (0.35)% 160.72% $0.0369
9/30/95 35.40% $6,241 2.90% 2.85% 4.17% 0.75% 262.97% --
CLASS B
10/31/96 (2) (1.66)% $2,132 2.50% 2.50% 3.13% (2.06)% 10.11% $0.0340
9/30/96 23.63% $2,022 2.50% 2.50% 3.37% (1.00)% 160.72% $0.0369
CLASS C
10/31/96 (2) (1.66)% $2,243 2.40% 2.40% 3.03% (1.96)% 10.11% $0.0340
9/30/96 23.81% $2,369 2.40% 2.40% 3.27% (0.90)% 160.72% $0.0369
9/30/95 34.90% $2,565 3.45% 3.40% 4.72% 0.20% 262.97% --
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
9
<PAGE>
GLOBAL PORTFOLIO
OBJECTIVE: Long-term growth of capital in a manner consistent with preservation
of capital primarily through investing in common stocks of foreign and domestic
issuers.
INVESTMENT FOCUS: The Global Portfolio invests primarily in common stocks of
foreign and domestic issuers. It also invests in securities issued by foreign or
domestic governments, government agencies, and other government entities.
INVESTOR PROFILE: For the investor who wants capital growth without being
limited to investments in U.S. securities. The investor should also be able to
tolerate the significant risk factors associated with foreign investing.
PRIMARY INVESTMENT PRACTICES: The Portfolio's assets are normally invested in
securities of issuers from at least five different countries, including the
United States. Under unusual marketing circumstances, the Portfolio may,
however, invest its assets in as few as three countries, or for temporary
emergency defensive purposes, in a single country.
The Portfolio seeks to invest substantially all of its assets in common stocks
of companies that the sub-adviser believes are experiencing favorable demand for
their products and services, and which operate in a favorable competitive
environment and regulatory climate. These stocks are selected solely for their
capital growth potential; investment income is not a consideration.
In evaluating foreign investments, the manager looks for: prospects for relative
economic growth among countries, regions or geographic areas; expected levels of
inflation; government policies influencing business conditions; and the outlook
for currency relationships.
SUB-ADVISER: Janus Capital Corporation
^
10
<PAGE>
<TABLE>
<CAPTION>
GLOBAL PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
==============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None
Redemption Fees (a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) (b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00%
12b-1 Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (c) 0.74% 0.74% 0.74%
----- ----- -----
Total Operating Expenses (c) 2.09% 2.74% 2.64%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $75 $117 $161 $284
B $78 $115 $155 $291
C $27 $82 $140 $297
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $75 $117 $161 $284
B $28 $85 $145 $291
C $27 $82 $140 $297
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. The percentages shown are for the fiscal year ended September 30,
1996.
</TABLE>
The purpose of the Examples shown in the ^ Summary of Expenses ^ are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
11
<PAGE>
<TABLE>
<CAPTION>
GLOBAL PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $21.40 $(0.02) $0.01 $(0.01) -- -- -- $21.39
9/30/96 $17.73 $(0.09) $4.38 $4.29 -- $(0.62) $(0.62) $21.40
9/30/95 $15.93 $(0.06) $2.42 $2.36 -- $(0.56) $(0.56) $17.73
9/30/94 $13.35 $(0.04) $2.62 $2.58 -- -- -- $15.93
9/30/93 $10.00 $(0.04) $3.39 $3.35 -- -- -- $13.35
CLASS B
10/31/96 (2) $21.14 $(0.02) $0.01 $(0.01) -- -- -- $21.13
9/30/96 $17.57 $(0.19) $4.38 $4.19 -- $(0.62) $(0.62) $21.14
CLASS C
10/31/96 (2) $21.04 $(0.02) $0.01 $(0.01) -- -- -- $21.03
9/30/96 $17.46 $(0.18) $4.38 $4.20 -- $(0.62) $(0.62) $21.04
9/30/95 $15.74 $(0.14) $2.42 $2.28 -- $(0.56) $(0.56) $17.46
9/30/94 $13.35 $(0.23) $2.62 $2.39 -- -- -- $15.74
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) (0.05)% $135,837 2.08% 2.07% -- (1.15)% 2.59% $0.0520
9/30/96 25.04% $131,347 2.09% 2.06% -- (0.67)% 97.94% $0.0489
9/30/95 15.47% $89,397 2.10% 1.97% -- (0.43)% 161.48% --
9/30/94 19.33% $81,241 2.14% -- -- (0.55)% 148.01% --
9/30/93 33.52% $17,430 2.84% -- 3.65% (0.87)% 116.98% --
CLASS B
10/31/96 (2) (0.05)% $5,966 2.73% 2.72% -- (1.80)% 2.59% $0.0520
9/30/96 24.70% $5,000 2.74% 2.71% -- (1.32)% 97.94% $0.0489
CLASS C
10/31/96 (2) (0.05)% $8,624 2.63% 2.62% -- (1.70)% 2.59% $0.0520
9/30/96 24.91% $8,081 2.64% 2.61% -- (1.22)% 97.94% $0.0489
9/30/95 15.14% $3,567 2.65% 2.52% -- (0.98)% 161.48% --
9/30/94 17.90% $3,571 4.04% -- -- (2.46)% 148.01% --
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
12
<PAGE>
GROWTH PORTFOLIO
OBJECTIVE: Growth of capital.
INVESTMENT FOCUS: The Growth Portfolio invests primarily in common stocks listed
on a national securities exchange or on NASDAQ, which the Portfolio's
sub-adviser believes have a good potential for capital growth. Investment
analysis focuses on stocks with earnings growth potential that may not be
recognized by the market. These securities are selected solely for their growth
potential; investment income is not a consideration.
INVESTOR PROFILE: For the investor who wants capital growth in a broadly
diversified stock portfolio, and who can tolerate significant fluctuations in
value.
PRIMARY INVESTMENT PRACTICES: The Portfolio seeks to invest substantially all of
its assets in common stocks when its sub-adviser believes that the relevant
market environment favors such investing. Common stock investments are selected
from industries and companies that the portfolio manager believes are
experiencing favorable demand for their products and services, and which operate
in a favorable competitive environment and regulatory climate.
SUB-ADVISER: Janus Capital Corporation
^
13
<PAGE>
<TABLE>
<CAPTION>
GROWTH PORTFOLIO
SUMMARY OF EXPENSES CLASS OF
SHARES
A B C T
================================================================================================================================
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None 8.50%
Redemption Fees (a) None None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None None
whichever is lower) (b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00% 1.00%
12b-1 Distribution and Service Fees 0.35% 1.00% 0.90% --
Other Expenses (c) 0.33% 0.33% 0.33% 0.33%
----- ----- ----- -----
Total Operating Expenses (c) 1.68% 2.33% 2.23% 1.33%
EXAMPLES
The tables below show the expenses you would pay on a $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $71 $105 $141 $243
B $74 $103 $135 $250
C $23 $70 $119 $256
T $97 $124 $152 $232
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $71 $105 $141 $243
B $24 $73 $125 $250
C $23 $70 $119 $256
T $97 $124 $152 $232
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A or Class T shares in amounts greater
than $1,000,000, a contingent deferred sales charge of 1% applies for 12 months
after purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. Other Expenses for Class A, Class B and Class C for the fiscal year
ended September 30, 1996 were 0.48%, 0.46% and 0.44%, respectively; and Other
Expenses for Class T for the fiscal year ended October 31, 1996 were 0.33% on an
annualized basis. Other Expenses shown for each class are based on estimates for
the period ending October 31, 1997. Other Expenses for the fiscal year ended
September 30, 1996 reflect the effects of the reorganization of IDEX Fund and
IDEX Fund 3 into Class T.
</TABLE>
The purpose of the Examples shown in the Summary of Expenses are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
14
<PAGE>
<TABLE>
<CAPTION>
GROWTH PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $22.21 -- $(0.24) $(0.24) -- -- -- $21.97
9/30/96 $22.84 $(0.11) $4.66 $4.55 -- $(5.18) $(5.18) $22.21
9/30/95 $16.78 $(0.05) $6.18 $6.13 -- $(0.07) $(0.07) $22.84
9/30/94(4)(14) $18.46 $0.01 $(1.22) $(1.21) -- $(0.47) $(0.47) $16.78
9/30/93 (3) $16.46 $0.04 $2.42 $2.46 $(0.07) $(0.39) $(0.46) $18.46
9/30/92 $16.22 $0.08 $0.88 $0.96 $(0.07) $(0.65) $(0.72) $16.46
9/30/91 (4) $13.77 $0.14 $5.32 $5.46 $(0.17) $(2.84) $(3.01) $16.22
9/30/90 $17.52 $0.12 $(2.21) $(2.09) $(0.09) $(1.57) $(1.66) $13.77
9/30/89 $11.48 $0.09 $6.18 $6.27 $(0.23) -- $(0.23) $17.52
9/30/88 $14.08 $0.25 $(1.59) $(1.34) $(0.16) $(1.10) $(1.26) $11.48
9/30/87 $9.90 $0.14 $4.11 $4.25 $(0.07) -- $(0.07) $14.08
9/30/86 $10.00 $0.07 $(0.17) $(0.10) -- -- -- $9.90
CLASS B
10/31/96 (2) $21.85 $(0.01) $(0.24) $(0.25) -- -- --
9/30/96 $22.64 $(0.27) $4.66 $4.39 -- $(5.18) $(5.18) $21.85
CLASS C
10/31/96 (2) $21.91 $(0.02) $(0.24) $(0.26) -- -- -- $21.65
9/30/96 $22.64 $(0.21) $4.66 $4.45 -- $(5.18) $(5.18) $21.91
9/30/95 $16.68 $(0.15) $6.18 $6.03 -- $(0.07) $(0.07) $22.64
9/30/94 (14) $18.46 $(0.09) $(1.22) $(1.31) -- $(0.47) $(0.47) $16.68
CLASS T (8)
10/31/96 (2) $22.41 -- $(0.24) $(0.24) -- -- -- $22.17
9/30/96 (13) $22.23 -- $0.18 $0.18 -- -- -- $22.41
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) (1.09)% $565,032 1.68% 1.68% -- (0.13)% 9.40% $0.0360
9/30/96 22.41% $567,564 1.83% 1.82% -- (0.22)% 57.80% $0.0385
9/30/95 36.70% $485,935 1.86% 1.84% -- (0.26)% 123.26% --
9/30/94 (4) (6.72)% $431,207 1.76% -- -- 0.04% 63.73% --
9/30/93 15.13 % $548,564 1.61% -- -- 0.29% 97.40% --
9/30/92 6.10% $403,361 1.61% -- -- 0.69% 56.21% --
9/30/91 (4) 48.00% $126,436 1.48% -- -- 0.88% 102.16% --
9/30/90 (12.50)% $74,594 1.35% -- -- 0.75% 127.79% --
9/30/89 55.70% $89,494 1.41% -- -- 0.67% 98.88% --
9/30/88 (8.00)% $65,463 1.47% -- -- 2.45% 133.28% --
9/30/87 44.10% $78,979 1.32% 1.39% -- 0.94% 167.58% --
9/30/86 (1.70)% $19,745 2.02% 2.21% -- 2.35% 19.57% --
CLASS B
10/31/96 (2) (1.14)% $5,242 2.32% 2.32% -- (0.78)% 9.40% $0.0360
9/30/96 21.87% $4,536 2.46% 2.45% -- (0.86)% 57.80% $0.0385
CLASS C
10/31/96 (2) (1.19)% $11,016 2.23% 2.23% -- (0.68)% 9.40% $0.0360
9/30/96 22.15% $11,167 2.34% 2.33% -- (0.77)% 57.80% $0.0385
9/30/95 36.32% $5,593 2.41% 2.38% -- (0.81)% 123.26% --
9/30/94 (7.72)% $3,423 3.48% -- -- (1.68)% 63.73% --
CLASS T (8)
10/31/96 (2) (1.03)% $573,884 1.33% 1.33% -- (0.20)% 9.40% $0.0360
9/30/96 (13) 0.81% $585,505 1.18% 1.17% -- 0.36% 57.80% $0.0385
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
15
<PAGE>
C.A.S.E. PORTFOLIO
OBJECTIVE: Annual growth of capital through investment in companies whose
management, financial resources and fundamentals appear attractive on a scale
measured against each company's present value.
INVESTMENT FOCUS: The C.A.S.E. Portfolio's assets are normally invested in
companies whose securities are traded on a national exchange or in the domestic
over-the-counter markets. Companies are selected based on their perceived
qualitative and quantitative fundamental strengths, on a market relative basis
against other companies in the same industry, sector and against the broad
market.
INVESTOR PROFILE: For investors who seek growth in excess of the S&P 500 on a
quarterly basis, in good markets as well as bad markets, but want a diversified
portfolio that seeks to have investments in companies that have below market
risk characteristics. The investor should be comfortable with the price
fluctuations of a stock portfolio.
PRIMARY INVESTMENT PRACTICES: Employing the sub-adviser's proprietary forms of
market comparative and stock specific research, companies are selected after
evaluating the present nature of the economic cycle and after the sub-adviser
identifies what it believes to be attractive sectors, industries and company
specific circumstances. The Portfolio normally invests in common, preferred and
convertible stocks of firms that the sub-adviser believes exhibit below market
risk characteristics supported by below market multiples on a leading, lagging
and ten-year basis, and are perceived to have above average fundamentals
including return on equity, price to earnings ratio and other balance sheet
components to obtain long-term capital growth. The sub-adviser applies its
proprietary forms of research to such companies which it believes exhibit
superior products, above average growth rates along with sound management and
financials. Each company selected in the Portfolio is monitored against more
than two dozen disciplines, on a market and comparative basis, including
insider's activity, market style leadership, earnings surprise, analyst's change
in earnings projection, return on equity, five-year earnings per share growth,
price earnings ratio, price-to-book, price to cash flow, institutional activity
and holdings, stock price changes, price to 200 day moving average, price to
historical rising inflation, price to declining U.S. dollar and earnings
projected change. The sub-adviser believes that above average performance is as
much a condition of eliminating bad situations as it is discovering good ones.
Securities are sold when companies appear overvalued or lose the fundamentals
necessary for future confidence as determined by the sub-adviser of the
Portfolio. Under certain circumstances, the Portfolio may elect to invest 20% or
more of its investable assets in money market instruments, repurchase agreements
and cash equivalents.
During the fiscal year ended September 30, 1996, the C.A.S.E. Portfolio was
leveraged for 12 days (up to an amount equal to 20% of total assets) for
temporary purposes. The purpose of the leveraging was to fulfill a short-short
gain requirement in order to retain status as a regulated investment company
under the Code. This circumstance developed due to abnormally high redemptions
and purchases during the fiscal year.
Estimated portfolio turnover for the C.A.S.E. Portfolio for its initial year of
operations was 100% to 200%. For the period from February 1, 1996 (inception)
through September 30, 1996, and for the one-month period ending October 31,
1996, the Portfolio's turnover rate was 654.49% and 20.69%, respectively. The
unexpectedly high rate of turnover for the period ending September 30, 1996 was
caused by a number of large investments in, and redemptions from, the Portfolio
over a relatively short period of time through shareholder accounts advised by a
common representative, necessitating significant purchases, and subsequent
liquidation, of portfolio investments.
SUB-ADVISER: C.A.S.E. Management, Inc.
16
<PAGE>
<TABLE>
<CAPTION>
C.A.S.E. PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
=============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None
Redemption Fees ^(a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) ^(b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00%
12b-1 ^ Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (net of expense reimbursements and/or fee waivers^) (c) 1.50% 1.50% 1.50%
----- ----- -----
Total Operating Expenses (net of expense reimbursements and/or fee waivers^) (c) 2.85% 3.50% 3.40%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $82 $138 (d) (d)
B $85 $137 (d) (d)
C $34 $104 (d) (d)
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $82 $138 (d) (d)
B $35 $107 (d) (d)
C $34 $104 (d) (d)
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. The percentages shown are actual for the period February 1, 1996
through September 30, 1996, and have been annualized.
(d) Pursuant to applicable rules, Portfolios that have been in operation
for less than 10 months complete only one- and three-year period portions of the
Examples.
</TABLE>
The purpose of the Examples shown in the ^ Summary of Expenses ^ are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
17
<PAGE>
<TABLE>
<CAPTION>
C.A.S.E. PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $10.46 $(0.07) $0.17 $0.10 -- -- -- $10.56
9/30/96 $10.00 $0.61 $(0.15) $0.46 -- -- -- $10.46
CLASS B
10/31/96 (2) $10.41 $(0.07) $0.17 $0.10 -- -- -- $10.51
9/30/96 $10.00 $0.56 $(0.15) $0.41 -- -- -- $10.41
CLASS C
10/31/96 (2) $10.42 $(0.07) $0.17 $0.10 -- -- -- $10.52
9/30/96 $10.00 $0.57 $(0.15) $0.42 -- -- -- $10.42
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) 0.96% $1,675 1.85% 1.84% 6.79% 0.27% 20.69% $0.0603
9/30/96 4.60% $1,455 2.85% 2.85% 5.89% 10.00% 654.49% $0.0396
CLASS B
10/31/96 (2) 0.96% $1,159 2.50% 2.49% 7.44% 0.38% 20.69% $0.0603
9/30/96 4.10% $1,100 3.50% 3.50% 6.54% 9.35% 654.49% $0.0396
CLASS C
10/31/96 (2) 0.96% $687 2.40% 2.39% 7.34% 0.28% 20.69% $0.0603
9/30/96 4.20% $613 3.40% 3.40% 6.44% 9.45% 654.49% $0.0396
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
18
<PAGE>
VALUE EQUITY PORTFOLIO
OBJECTIVE: Maximum consistent total return with minimum risk to principal.
INVESTMENT FOCUS: The Value Equity Portfolio invests primarily in common stocks
with above-average statistical value which the sub-adviser believes are in
fundamentally attractive industries and are undervalued at the time of purchase.
INVESTOR PROFILE: For the investor who seeks both capital preservation and
long-term capital appreciation.
PRIMARY INVESTMENT PRACTICES: The Portfolio seeks to achieve its investment
objective by investing its assets in common stocks with above-average
statistical value which the sub-adviser believes are in fundamentally attractive
industries and are undervalued at the time of purchase. The sub-adviser will
seek to identify stocks of above-average statistical value by using statistical
measures to screen for below-average price-to-earnings and price-to-book ratios,
above-average dividend yields and strong financial stability.
The sub-adviser will begin the process of evaluating potential common stock and
equity-related securities investments by screening a universe of 1,100
companies, primarily of medium to large capitalization. For these purposes, the
sub-adviser considers medium capitalization stocks to be stocks issued by
companies with market capitalization of between $500 million and $3 billion, and
large capitalization stocks to be those stocks issued by companies with market
capitalization in excess of $3 billion. Investments in companies with market
capitalization under $500 million will be limited to 10% of the Portfolio's
total assets.
The process used by the sub-adviser to identify promising under-valued companies
within this universe of companies may be different from those of other
value-oriented investment managers in the following ways: the use of earnings
averaged over both strong and weak periods to value cyclical companies, a focus
on quality of earnings, investment in relative value, and concentration in
industries/sectors having strong long-term fundamentals.
As a part of this multi-disciplined approach to capturing value, the sub-adviser
first seeks to identify market sectors early in their cycle of fundamental
improvement, investor recognition and market exploitation. Industry fundamentals
used in this decision making process are business trend analysis (to analyze
industry and company fundamentals for the impact of changing worldwide product
demand/supply), direction of inflation and interest rates, and
expansion/contraction of business cycles. The sub-adviser utilizes in-house
capabilities, in addition to independent resources, for economic, industry and
securities research.
Following this initial phase, approximately 200 companies that the sub-adviser
believes have above-average statistical value and are in a sector identified as
having positive fundamentals on a long-term basis, will be actively followed.
The Portfolio's investments will generally be selected from among these 200
actively followed companies. Company visits and interviews with management
augment fundamental research in seeking to identify the potential value in these
investments. The Portfolio will ^ focus on those industries with positive
fundamentals and likewise will seek to minimize risk by avoiding industries with
deteriorating long-term fundamentals.
SUB-ADVISER: NWQ Investment Management Company, Inc,
19
<PAGE>
<TABLE>
<CAPTION>
VALUE EQUITY PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
=============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None
Redemption Fees (a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) (b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00%
12b-1 Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (c) 0.15% 0.15% 0.15%
----- ----- -----
Total Operating Expenses (c) 1.50% 2.15% 2.05%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $69 $100 (d) (d)
B $72 $97 (d) (d)
C $21 $64 (d) (d)
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $69 $100 (d) (d)
B $22 $67 (d) (d)
C $21 $64 (d) (d)
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) Other Expenses shown for the Value Equity Portfolio are based on
estimates for the current fiscal year. For the period ended October 31, 1997,
annualized Total Expenses for Value Equity Class A, Class B and Class C are
expected to be 3.35%, 4.00% and 3.90%, respectively, absent reimbursement.
(d) Pursuant to applicable rules, Portfolios that have been in operation
for less than 10 months complete only one- and three-year period portions of the
Examples.
</TABLE>
The purpose of the Examples shown in the Summary of Expenses are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
NOTE: No Financial Highlights exist for the Value Equity Portfolio, as that
Portfolio commenced operations on February 1, 1997.
20
<PAGE>
^ STRATEGIC TOTAL RETURN PORTFOLIO
OBJECTIVE: Current income, long-term growth of income and capital appreciation.
INVESTMENT FOCUS: The Strategic Total Return Portfolio (formerly Equity-Income
Portfolio) seeks to invest primarily in a blend of equity and fixed-income
securities, including common stocks, income-producing securities convertible
into common stock and fixed-income securities. The Portfolio will primarily
invest in equity and debt securities of companies with established operating
histories and strong fundamental characteristics.
INVESTOR PROFILE: For the investor who seeks capital appreciation and income
growth through a strategic blend of stocks and bonds. The investor should desire
a fundamentally-oriented investment approach which emphasizes risk management.
PRIMARY INVESTMENT PRACTICES: The Portfolio seeks to invest its assets primarily
in income producing common or preferred stock, debt obligations, some of which
will typically be convertible into common stock, and other fixed-income
securities. The sub-adviser typically seeks companies which exhibit strong
fundamental characteristics and considers fundamental factors such as balance
sheet quality, cash flow generation, earnings and dividend growth record and
outlook, and profitability levels. The sub-advisor presently intends to consider
these and other fundamental characteristics in determining attractive investment
opportunities in equity and fixed-income investment securities. However, the
sub-adviser may select securities based on other factors. For example, some
securities may be purchased at an apparent discount to their appropriate value,
anticipating that they will increase to that value over time. The Portfolio
seeks to achieve an income yield in excess of the average dividend income yield
of the stocks in the S&P 500 primarily by utilizing both equity and fixed-income
securities. The Portfolio does not, at present, intend to invest more than 20%
of its assets in equities which do not pay a dividend.
The sub-adviser expects that the majority of the Portfolio's equity securities
will be listed on a national securities exchange or traded on NASDAQ or in the
U.S. over-the-counter market.
SUB-ADVISER: Luther King Capital Management Corporation
21
<PAGE>
<TABLE>
<CAPTION>
STRATEGIC TOTAL RETURN PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
=============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None
Redemption Fees ^(a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) ^(b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00%
12b-1 ^ Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (net of expense reimbursements and/or fee waivers^) (c) 0.50% 0.50% 0.50%
----- ----- -----
Total Operating Expenses (net of expense reimbursements and/or fee waivers^) (c) 1.85% 2.50% 2.40%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $73 $110 $150 $260
B $75 $108 $143 $267
C $24 $75 $128 $274
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $73 $110 $150 $260
B $25 $78 $133 $267
C $24 $75 $128 $274
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. The percentages shown are for the fiscal year ended September 30,
1996.
</TABLE>
The purpose of the Examples shown in the ^ Summary of Expenses ^ are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
22
<PAGE>
<TABLE>
<CAPTION>
STRATEGIC TOTAL RETURN PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $13.27 $0.01 $0.15 $0.16 -- -- -- $13.43
9/30/96 $11.74 $0.57 $1.28 $1.85 $(0.17) $(0.15) $(0.32) $13.27
9/30/95 $10.00 $0.09 $1.75 $1.84 $(0.10) -- $(0.10) $11.74
CLASS B
10/31/96 (2) $13.27 -- $0.15 $0.15 -- -- -- $13.42
9/30/96 $11.73 $0.50 $1.28 $1.78 $(0.09) $(0.15) $(0.24) $13.27
CLASS C
10/31/96 (2) $13.27 -- $0.15 $0.15 -- -- -- $13.42
9/30/96 $11.73 $0.52 $1.28 $1.80 $(0.11) $(0.15) $(0.26) $13.27
9/30/95 $10.00 $0.03 $1.75 $1.78 $(0.05) -- $(0.05) $11.73
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) 1.20% $11,744 1.85% 1.82% 2.76% 1.47% 5.50% $0.0591
9/30/96 16.00% $11,314 1.85% 1.79% 2.79% 1.67% 40.58% $0.0622
9/30/95 18.43% $5,167 2.99% 2.85% 4.57% 0.85% 34.67% --
CLASS B
10/31/96 (2) 1.13% $1,684 2.50% 2.47% 3.40% 0.82% 5.50% $0.0591
9/30/96 15.38% $1,537 2.50% 2.44% 3.44% 1.02% 40.58% $0.0622
CLASS C
10/31/96 (2) 1.13% $1,792 2.40% 2.37% 3.30% 0.92% 5.50% $0.0591
9/30/96 15.49% $1,728 2.40% 2.34% 3.34% 1.12% 40.58% $0.0622
9/30/95 17.95% $281 3.54% 3.40% 5.12% 0.30% 34.67% --
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
23
<PAGE>
TACTICAL ASSET ALLOCATION PORTFOLIO
OBJECTIVE: Preservation of capital and competitive investment returns.
INVESTMENT FOCUS: The Tactical Asset Allocation Portfolio invests primarily in
stocks, U.S. Treasury bonds, notes and bills and money market funds. Models are
used in determining when the Portfolio's assets are "tactically" allocated among
these groups of investments.
INVESTOR PROFILE: For the investor who wants a combination of capital growth and
income, and who is comfortable with the risks associated with an actively traded
portfolio which shifts assets between equity and debt.
PRIMARY INVESTMENT PRACTICES: The Portfolio does not, at present, intend to
invest more than 20% of its assets in equities which do not pay a dividend. The
Portfolio focuses on high quality, liquid, large capitalization stocks. These
stocks are selected via a "bottom-up" screening method (i.e., company by
company, not industry by industry, or by any other large category) which seeks
to identify undervalued companies. The screening method compares financial
characteristics such as the price-to-cash flow ratio, price-to-sales ratio,
price-to-earnings ratio (P/E ratio), dividend yield, and return on equity to a
stock's historical norms. The Portfolio seeks to achieve an income yield in
excess of the dividend income yield of the S&P 500. Undervalued companies --
those which are selling at less than true value -- are by definition out of
favor with most investors. However, the portfolio manager believes that
investors' expectations and the company's operating performance ultimately
determine which statistically "undervalued" stocks make good investments. In
order to preserve a margin of safety for the Portfolio's investors, the
sub-adviser thoroughly reviews the risks surrounding stocks under consideration
for investment. The goal is to choose stocks whose price has been driven down
due to an "overreaction" by the market to their perceived risks. Stocks are
given a careful fundamental and technical evaluation to determine their likely
prospects for positive investment performance.
"Asset allocation" is an investment technique which shifts assets from one class
of investment to another in anticipation of changes in market direction. The
Portfolio seeks to enhance its returns in positive markets by increasing its
equity exposure, then to protect itself in negative markets by shifting assets
into fixed income investments and reducing equity exposure.
The portfolio manager utilizes a series of linear statistical models that
attempt to forecast total stock market returns for both short (12 to 18 months)
and long (36 to 60 months) time periods. These time series models, developed by
the sub-adviser, help compare anticipated risks and rewards of holding stocks
versus holding treasury notes and money market funds. The models therefore
determine when the sub-adviser "tactically" adjusts asset allocation through a
gradual shifting of assets among stocks, U.S. Treasury bonds and notes and money
market funds. A combination of fundamental, technical, sentiment and monetary
variables is used in the forecasting models.
The Portfolio seeks to invest its assets primarily in income producing common or
preferred stock when the sub-adviser believes that the market environment favors
profitable investing in such securities. The remainder of the Portfolio will
ordinarily be invested in debt obligations of U.S. issuers, some of which will
typically be convertible into common stock.
If the forecasting models predict a decline in the stock market, the Portfolio
may invest as much as 10% of its total assets in money market funds, within
limits imposed by the 1940 Act, which restricts the Portfolio's investments in
investment companies. The Portfolio will indirectly bear its proportionate share
of any investment advisory fees and expenses paid by the funds in which it
invests, in addition to the investment advisory fee and expenses paid by the
Portfolio.
SUB-ADVISER: Dean Investment Associates
24
<PAGE>
<TABLE>
<CAPTION>
TACTICAL ASSET ALLOCATION PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
=============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None
Redemption Fees (a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) (b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00%
12b-1 Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (net of expense reimbursements and/or fee waivers) (c) 1.50% 1.50% 1.50%
----- ----- -----
Total Operating Expenses (net of expense reimbursements and/or fee waivers) (c) 2.85% 3.50% 3.40%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $82 $138 $197 $355
B $85 $137 $192 $363
C $34 $104 $177 $368
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $82 $138 $197 $355
B $35 $107 $182 $363
C $34 $104 $177 $368
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. The percentages shown are for the fiscal year ended September 30,
1996.
</TABLE>
The purpose of the Examples shown in the Summary of Expenses are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
25
<PAGE>
<TABLE>
<CAPTION>
TACTICAL ASSET ALLOCATION PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $11.03 $0.02 $0.14 $0.16 -- -- -- $11.19
9/30/96 $10.00 $0.17 $0.94 $1.11 $(0.08) -- $(0.08) $11.03
CLASS B
10/31/96 (2) $11.02 $0.02 $0.14 $0.16 -- -- -- $11.18
9/30/96 $10.00 $0.09 $0.94 $1.03 $(0.01) -- $(0.01) $11.02
CLASS C
10/31/96 (2) $11.03 $0.01 $0.14 $0.15 -- -- -- $11.18
9/30/96 $10.00 $0.11 $0.94 $1.05 $(0.02) -- $(0.02) $11.03
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) 1.45% $8,396 1.85% 1.85% 2.65% 1.26% 2.38% $0.0800
9/30/96 11.07% $7,401 2.85% 2.85% 3.20% 0.72% 56.22% $0.0828
CLASS B
10/31/96 (2) 1.45% $5,013 2.50% 2.50% 3.30% 0.61% 2.38% $0.0800
9/30/96 10.39% $4,848 3.50% 3.50% 3.85% 0.07% 56.22% $0.0828
CLASS C
10/31/96 (2) 1.36% $4,758 2.40% 2.40% 3.20% 0.71% 2.38% $0.0800
9/30/96 10.50% $4,641 3.40% 3.40% 3.75% 0.17% 56.22% $0.0828
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
<PAGE>
26
<PAGE>
BALANCED PORTFOLIO
OBJECTIVE: Long-term capital growth, consistent with preservation of capital and
balanced by current income.
INVESTMENT FOCUS: The Balanced Portfolio normally invests 40-60% of its assets
in securities selected primarily for their growth potential and 40-60% of its
assets in securities selected primarily for their income potential. At least 25%
of its assets normally will be invested in fixed income senior securities, which
include debt securities and preferred stocks.
INVESTOR PROFILE: For the investor who wants capital growth and income from the
same investment, but who also wants an investment which has the prospect of
sustaining its interim principal value through maintaining a balance between
equity and debt. The Portfolio is not designed for investors who desire a
consistent level of income.
PRIMARY INVESTMENT PRACTICES: The growth component of the Portfolio is expected
to consist primarily of common stocks, selected in industries and companies that
the sub-adviser believes are experiencing favorable demand for their products
and services, and which operate in a favorable competitive environment and
regulatory climate. The sub-adviser's analysis of these stocks aims to find
companies with earnings growth potential that may not be recognized by the
market.
The income component of the Portfolio may consist of all types of
income-producing securities, including common stocks selected primarily for
their dividend payments, preferred stocks, convertible securities and debt
securities of corporate and government issuers.
The Portfolio may select equity securities for the income component on the basis
of growth potential, dividend paying properties, or some combination of both.
The Portfolio may shift assets between the growth and income portions of its
portfolio based on its manager's analysis of the relevant market, financial and
economic conditions. If the sub-adviser believes that growth securities will
provide better returns than the yields available or expected on income-producing
securities, then the Portfolio will place a greater emphasis on growth
securities.
SUB-ADVISER: Janus Capital Corporation
27
<PAGE>
<TABLE>
<CAPTION>
BALANCED PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
=============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 5.50% None None
Redemption Fees ^(a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) ^(b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 1.00% 1.00% 1.00%
12b-1 ^ Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (net of expense reimbursements and/or fee waivers^) (c) 0.50% 0.50% 0.50%
----- ----- -----
Total Operating Expenses (net of expense reimbursements and/or fee waivers^) (c) 1.85% 2.50% 2.40%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $73 $110 $150 $260
B $75 $108 $143 $267
C $24 $75 $128 $274
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $73 $110 $150 $260
B $25 $78 $133 $267
C $24 $75 $128 $274
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. The percentages shown are for the fiscal year ended September 30,
1996.
</TABLE>
The purpose of the Examples shown in the ^ Summary of Expenses ^ are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
28
<PAGE>
<TABLE>
<CAPTION>
BALANCED PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $13.47 $0.01 $0.10 $0.11 -- -- -- $13.58
9/30/96 $11.47 $0.72 $1.77 $2.49 $(0.21) $(0.28) $(0.49) $13.47
9/30/95 $10.00 $0.05 $1.47 $1.52 $(0.05) -- $(0.05) $11.47
CLASS B
10/31/96 (2) $13.46 -- $0.10 $0.10 -- -- -- $13.56
9/30/96 $11.47 $0.63 $1.77 $2.40 $(0.13) $(0.28) $(0.41) $13.46
CLASS C
10/31/96 (2) $13.46 $0.01 $0.10 $0.11 -- -- -- $13.57
9/30/96 $11.47 $0.64 $1.77 $2.41 $(0.14) $(0.28) $(0.42) $13.46
9/30/95 $10.00 $0.01 $1.47 $1.48 $(0.01) -- $(0.01) $11.47
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) 0.81% $8,402 1.85% 1.85% 3.44% 1.84% 9.08% $0.0408
9/30/96 22.12% $8,056 1.85% 1.85% 3.11% 1.87% 175.78% $0.0443
9/30/95 15.27% $3,670 2.92% 2.85% 4.48% 0.56% 82.48% --
CLASS B
10/31/96 (2) 0.74% $878 2.50% 2.50% 4.09% 1.18% 9.08% $0.0408
9/30/96 21.38% $687 2.50% 2.50% 3.76% 1.22% 175.78% $0.0443
CLASS C
10/31/96 (2) 0.81% $967 2.40% 2.40% 3.99% 1.28% 9.08% $0.0408
9/30/96 21.49% $943 2.40% 2.40% 3.66% 1.32% 175.78% $0.0443
9/30/95 14.77% $3,365 3.47% 3.40% 5.03% 0.01% 82.48% --
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
<PAGE>
29
<PAGE>
FLEXIBLE INCOME PORTFOLIO
OBJECTIVE: Maximum total return for shareholders, consistent with preservation
of capital, by actively managing a portfolio of income- producing securities.
INVESTMENT FOCUS: As a fundamental policy, the Flexible Income Portfolio will
normally invest at least 80% of its total assets in income-producing securities.
It may invest in all types of income-producing securities, including domestic or
foreign securities issued by companies or by governments or governmental
agencies and lower rated securities.
INVESTOR PROFILE: For the investor who wants current income enhanced by possible
capital growth, and is willing to tolerate the fluctuation in principal value
associated with changes in the interest rate environment and the risks
associated with substantial holdings of high-yield/high-risk bonds.
PRIMARY INVESTMENT PRACTICES: The Portfolio emphasizes total return, primarily
through investing in corporate debt securities which offer higher yield but more
risk than higher grade securities. It may purchase debt securities of any
maturity. The average maturity of the Portfolio may vary substantially,
depending on the sub-adviser's analysis of market, economic and financial
conditions.
The Portfolio has no pre-established quality standards and may invest in debt
securities of any quality, including lower rated bonds that may offer higher
yields because of the greater risks involved in such investments. The Portfolio
may also invest in unrated debt securities of foreign and domestic issuers.
The Portfolio may, at times, have substantial holdings of high-yield/high-risk
bonds or unrated bonds of foreign and domestic issuers.
The Portfolio may also purchase mortgage-and other asset-backed securities,
preferred stocks, income producing common stocks or securities convertible into
common stocks if such securities appear to offer the best opportunity for
maximum total return.
If rated securities held by the Portfolio are downgraded by a ratings agency,
the sub-adviser will consider the advisability of keeping these securities.
The sub-adviser uses, but does not place sole reliance on, credit ratings in
evaluating bonds and determining credit quality of the issuer.
SUB-ADVISER: Janus Capital Corporation
30
<TABLE>
<CAPTION>
FLEXIBLE INCOME PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
=============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 4.75% None None
Redemption Fees ^(a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) ^(b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 0.90% 0.90% 0.90%
12b-1 ^ Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (net of expense reimbursements and/or fee waivers^) (c) 0.60% 0.60% 0.60%
----- ----- -----
Total Operating Expenses (net of expense reimbursements and/or fee waivers^) (c) 1.85% 2.50% 2.40%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $65 $103 $143 $254
B $75 $108 $143 $267
C $24 $75 $128 $274
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $65 $103 $143 $254
B $25 $78 $133 $267
C $24 $75 $128 $274
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. The percentages shown are for the fiscal year ended September 30,
1996.
</TABLE>
The purpose of the Examples shown in the Summary of Expenses are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
31
<PAGE>
<TABLE>
<CAPTION>
FLEXIBLE INCOME PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $9.19 $0.20 $(0.01) $0.19 $(0.05) -- $(0.05) $9.33
9/30/96 $9.17 $2.23 $(1.63) $0.60 $(0.58) -- $(0.58) $9.19
9/30/95 $8.83 $0.61 $0.37 $0.98 $(0.64) -- $(0.64) $9.17
9/30/94(4)(5) $9.59 $0.65 $(0.81) $(0.16) $(0.60) -- $(0.60) $8.83
9/30/93 $8.95 $0.70 $0.60 $1.30 $(0.66) -- $(0.66) $9.59
10/31/92 (3) $8.73 $0.80 $0.22 $1.02 $(0.80) -- $(0.80) $8.95
10/31/91 $7.74 $0.82 $1.10 $1.92 $(0.80) $(0.13) $(0.93) $8.73
10/31/90 $9.55 $0.90 $(1.80) $(0.90) $(0.91) -- $(0.91) $7.74
10/31/89 $10.15 $0.95 $(0.46) $0.49 $(0.93) $(0.16) $(1.09) $9.55
10/31/88 $9.60 $0.91 $0.55 $1.46 $(0.91) -- $(0.91) $10.15
10/31/87 $10.00 $0.25 $(0.40) $(0.15) $(0.25) -- $(0.25) $9.60
CLASS B
10/31/96 (2) $9.18 $0.20 $(0.01) $0.19 $(0.05) -- $(0.05) $9.32
9/30/96 $9.17 $2.16 $(1.63) $0.53 $(0.52) -- $(0.52) $9.18
CLASS C
10/31/96 (2) $9.18 $0.20 $(0.01) $0.19 $(0.05) -- $(0.05) $9.32
9/30/96 $9.17 $2.17 $(1.63) $0.54 $(0.53) -- $(0.53) $9.18
9/30/95 $8.83 $0.56 $0.37 $0.93 $(0.59) -- $(0.59) $9.17
9/30/94 $9.59 $0.60 $(0.81) $(0.21) $(0.55) -- $(0.55) $8.83
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) 2.08% $17,001 1.85% 1.85% 2.98% 6.15% 16.16% --
9/30/96 6.73% $17,065 1.85% 1.85% 2.07% 6.46% 135.38% --
9/30/95 11.57% $19,786 1.87% 1.85% 1.94% 7.03% 149.58% --
9/30/94(4)(5) (1.54)% $21,527 1.85% -- 2.13% 6.57% 105.40% --
9/30/93 13.66% $29,232 1.50% -- 1.56% 7.76% 138.86% --
10/31/92 (3) 12.17% $26,676 1.50% -- 1.66% 8.55% 140.23% --
10/31/91 26.38% $18,696 1.50% -- 1.75% 9.84% 130.73% --
10/31/90 (10.22)% $18,760 1.50% -- 1.60% 10.51% 72.40% --
10/31/89 5.17% $27,645 1.29% -- 1.56% 9.63% 71.44% --
10/31/88 15.62% $20,469 1.00% -- 1.96% 9.22% 54.42% --
10/31/87 (1.90)% $4,676 1.14% -- -- 7.88% 68.21% --
CLASS B
10/31/96 (2) 2.04% $522 2.50% 2.50% 3.63% 5.50% 16.16% --
9/30/96 5.94% $494 2.50% 2.50% 2.72% 5.81% 135.38% --
CLASS C
10/31/96 (2) 2.04% $846 2.40% 2.40% 3.53% 5.60% 16.16% --
9/30/96 6.03% $883 2.40% 2.40% 2.62% 5.91% 135.38% --
9/30/95 10.95% $558 2.42% 2.40% 2.49% 6.48% 149.58% --
9/30/94 (2.15)% $691 2.40% -- 8.59% 6.03% 105.40% --
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
<PAGE>
32
<PAGE>
INCOME PLUS PORTFOLIO
OBJECTIVE: As high a level of current income as is consistent with the avoidance
of excessive risk.
INVESTMENT FOCUS: The Income Plus Portfolio invests in a diversified portfolio
of fixed-income and convertible debt securities and dividend-paying common,
preferred and convertible preferred stocks. Although yields on convertible
securities are often lower than yields on nonconvertible bonds and preferred
stocks of comparable investment quality, the Portfolio may invest in convertible
securities if the total return is expected to provide higher current income than
nonconvertible securities. The Portfolio may also hold or invest in common
stocks which are acquired in conversion or exchange of, or in a unit offering
with, fixed-income securities.
INVESTOR PROFILE: For the investor who wants high current income and is willing
to tolerate the fluctuation in principal value associated with changes in the
interest rate environment.
PRIMARY INVESTMENT PRACTICES: The Portfolio seeks yields as high as possible
while managing risk through certain investment policies described below.
The Portfolio will not invest in rated securities that, at the time of
investment, are rated below B by Moody's or B by S&P ("b," in the case of
Moody's preferred stock ratings). It may invest in unrated securities which, in
the manager's judgment, are of equivalent quality. The Portfolio may not invest
in rated corporate securities if, after such investment, more than 50% of its
total holdings of securities (other than commercial paper) would then be rated
below investment grade (below the four highest rating categories); and will not
invest in rated securities that, at the time of investment, are rated B by
Moody's or B by S&P.
The Portfolio may not invest in commercial paper of corporate issuers which is
rated below Prime-2 by Moody's or A-2 by S&P. It may invest in unrated
commercial paper of comparable quality, as determined by the sub-adviser.
Under certain conditions, the Portfolio may temporarily invest some or all of
its assets in short-term obligations such as (a) commercial paper and bankers'
acceptances of U.S. banks; (b) U.S. dollar-denominated obligations of U.S. bank
branches located outside the United States and of U.S. branches of foreign
banks; (c) U.S. dollar-denominated time deposits (subject to certain
restrictions described in the SAI); and (d) obligations of the U.S. government,
its agencies or instrumentalities. Before investing in any foreign short-term
bank obligations, the sub-adviser will consider factors including the political
and economic condition in a country, the prospect for changes in the value of
its currency, the possibility of expropriation or nationalization, and interest
payment limitations, based on existing or prior actions of the foreign
government. Such risks cannot be entirely eliminated from foreign investing.
If rated securities held by the Portfolio are downgraded by a ratings agency,
the sub-adviser will consider the advisability of keeping these securities. At
all times, however, the sub-adviser will ensure that no more than 50% of the
Portfolio's total holdings (other than commercial paper) would be rated below
investment grade (below the four highest rating categories); and will not invest
in rated securities that, at the time of investment, are ratedB by Moody's or B
by S&P.
The sub-adviser uses, but does not place sole reliance on, credit ratings in
evaluating bonds and determining credit quality of the issuer.
SUB-ADVISER: AEGON USA Investment Management, Inc.
33
<PAGE>
<TABLE>
<CAPTION>
INCOME PLUS PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
================================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 4.75% None None
Redemption Fees (a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) (b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 0.60% 0.60% 0.60%
12b-1 Distribution and Service Fees 0.35% 1.00% 0.90%
Other Expenses (c) 0.38% 0.38% 0.38%
----- ----- -----
Total Operating Expenses (c) 1.33% 1.98% 1.88%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $60 $88 $117 $200
B $70 $92 $117 $214
C $19 $59 $102 $220
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A $60 $88 $117 $200
B $20 $62 $107 $214
C $19 $59 $102 $220
- -------------------------------
(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
(b) On certain purchases of Class A shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
(c) See Ratio of Expenses to Average Net Assets in the Financial Highlights
section, and Note 10 to the Notes to Financial Highlights for further discussion
of expenses. The percentages shown are for the fiscal year ended September 30,
1996.
</TABLE>
The purpose of the Examples shown in the Summary of Expenses are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
34
<PAGE>
<TABLE>
<CAPTION>
INCOME PLUS PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $10.41 $0.22 $0.04 $0.26 $(0.06) -- $(0.06) $10.61
9/30/96 $10.36 $2.72 $(1.96) $0.76 $(0.71) -- $(0.71) $10.41
9/30/95 $9.75 $0.75 $0.71 $1.46 $(0.75) $(0.10) $(0.85) $10.36
9/30/94 $10.98 $0.76 $(1.10) $(0.34) $(0.75) $(0.14) $(0.89) $9.75
9/30/93 $10.55 $0.83 $0.46 $1.29 $(0.81) $(0.05) $(0.86) $10.98
9/30/92 (6) $10.04 $0.76 $0.64 $1.40 $(0.76) $(0.13) $(0.89) $10.55
11/30/91 $9.20 $0.98 $0.87 $1.85 $(0.98) $(0.03) $(1.01) $10.04
11/30/90 $9.99 $1.04 $(0.79) $0.25 $(1.04) -- $(1.04) $9.20
11/30/89 $9.89 $1.04 $0.10 $1.14 $(1.04) -- $(1.04) $9.99
11/30/88 $9.85 $1.04 $0.06 $1.10 $(1.04) $(0.02) $(1.06) $9.89
11/30/87 $10.94 $1.08 $(1.03) $0.05 $(1.08) $(0.06) $(1.14) $9.85
11/30/86 $10.28 $1.06 $0.73 $1.79 $(1.06) $(0.07) $(1.13) $10.94
CLASS B
10/31/96 (2) $10.40 $0.23 $0.04 $0.27 $(0.06) -- $(0.06) $10.61
9/30/96 $10.35 $2.65 $(1.96) $0.69 $(0.64) -- $(0.64) $10.40
CLASS C
10/31/96 (2) $10.40 $0.23 $0.04 $0.27 $(0.06) -- $(0.06) $10.61
9/30/96 $10.35 $2.66 $(1.96) $0.70 $(0.65) -- $(0.65) $10.40
9/30/95 $9.74 $0.69 $0.71 $1.40 $(0.69) $(0.10) $(0.79) $10.35
9/30/94 $10.98 $0.66 $(1.10) $(0.44) $(0.66) $(0.14) $(0.80) $9.74
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) 2.53% $66,285 1.33% 1.32% -- 5.60% 1.58% --
9/30/96 7.64% $65,252 1.33% 1.31% -- 6.89% 65.96% --
9/30/95 15.85% $68,746 1.29% 1.26% -- 7.53% 25.07% --
9/30/94 (3.28)% $63,995 1.33% -- -- 7.35% 48.12% --
9/30/93 12.80% $72,401 1.33% -- -- 7.73% 54.51% --
9/30/92 (6) 14.40% $54,647 1.17% -- -- 8.79% 91.01% --
11/30/91 21.00% $47,334 1.15% -- 1.21% 10.20% 52.79% --
11/30/90 2.50% $33,182 0.69% -- 1.44% 11.12% 18.54% --
11/30/89 12.10% $23,416 0.70% -- 1.09% 10.59% 57.50% --
11/30/88 11.50% $17,078 0.68% -- 1.11% 10.55% 34.29% --
11/30/87 0.30% $11,349 0.64% -- 1.20% 10.82% 34.13% --
11/30/86 17.90% $4,221 1.29% -- 2.25% 9.93% 29.80% --
CLASS B
10/31/96 (2) 2.59% $804 1.98% 1.97% -- 4.95% 1.58% --
9/30/96 6.95% $774 1.98% 1.96% -- 6.24% 65.96% --
CLASS C
10/31/96 (2) 2.59% $2,781 1.88% 1.87% -- 5.05% 1.58% --
9/30/96 7.05% $2,684 1.88% 1.86% -- 6.34% 65.96% --
9/30/95 15.08% $1,980 1.84% 1.81% -- 6.98% 25.07% --
9/30/94 (4.55)% $2,112 3.52% -- -- 5.16% 48.12% --
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
35
<PAGE>
^ TAX-EXEMPT PORTFOLIO
OBJECTIVE: Maximum current interest income exempt from federal income tax,
consistent with preservation of capital.
INVESTMENT FOCUS: Ordinarily, at least 80% of the Tax-Exempt Portfolio's net
assets will be invested in municipal obligations. These are obligations issued
by states, territories or possessions of the United States, the District of
Columbia and their political subdivisions, agencies, instrumentalities and
authorities if the interest on such securities is, in the opinion of bond
counsel, exempt from federal income tax. Income from municipal obligations may
be subject to state and local tax and may constitute an item of preference for
determining the federal alternative minimum tax. The weighted average maturity
of securities in the Portfolio is generally expected to be between 20 and 35
years.
INVESTOR PROFILE: For the investor who wants high current federal tax-free
income, and is willing to tolerate the fluctuation in principal value associated
with changes in the interest rate environment. Yields on municipal obligations
are typically lower than on similar taxable securities. The Portfolio is not
well suited as an investment vehicle for tax-exempt retirement programs which
receive no benefit from the tax-exempt nature of the majority of the Portfolio's
income. Also, the benefits of tax-exempt income are greater for persons with
higher taxable incomes.
PRIMARY INVESTMENT PRACTICES: The Portfolio seeks yields as high as possible
while managing risk through certain investment policies described below.
The Portfolio normally invests at least 75% of its net assets in (a) municipal
obligations which are rated at the time of purchase within the four highest
ratings of Moody's or S&P; (b) municipal commercial paper rated at the time of
purchase within the highest grade assigned by Moody's or S&P; and (c) unrated
municipal notes (with maturities between 6 months and 3 years) of issuers which,
at the time of purchase, have outstanding at least one issue of municipal bonds
rated in the four highest ratings of Moody's or S&P. In addition, the Portfolio
may invest in unrated municipal obligations which the portfolio manager
considers equal in quality to the four highest ratings of Moody's or S&P.
Unrated municipal securities may be less liquid than rated securities.
Therefore, their purchase by the Portfolio may entail somewhat greater risk than
that involved in rated municipal obligations.
Bonds rated in the fourth category by Moody's or S&P have some speculative
characteristics. The Portfolio's operating policies place no specific limit on
the proportion of the Portfolio which may be made up of bonds in these
categories, so long as the sub-adviser believes that the Portfolio's objective
of preserving capital is being met. ^ If rated securities held by the Portfolio
are downgraded by a ratings agency, the sub-adviser will consider the
advisability of keeping these securities.
The Portfolio may also invest in floating and variable rate municipal
obligations or participation interests in such obligations. The interest on
these obligations or participations must be free from federal income tax, and
the credit quality must be equal to long-term bonds rated in the four highest
Moody's or S&P categories, or to short-term bonds rated in the two highest
Moody's or S&P categories.
Under certain conditions, the Portfolio may invest as much as 20% of its assets
in taxable securities. For example, the Portfolio may make such investments due
to market conditions, while temporarily holding funds in readiness for
tax-exempt investments, or to provide highly liquid securities to meet
anticipated share sales. Such investments may also be made when the sub-adviser
determines that a defensive position is required in anticipation of a decline in
the market value of portfolio securities. These temporary investments may
consist of the following fixed-income, short-term securities: (a) U.S.
government securities; (b) certificates of deposit issued by domestic banks with
assets of at least $1 billion and having deposits insured by the Federal Deposit
Insurance Corporation; (c) repurchase agreements with respect to government
securities; and (d) commercial paper rated P-1 by Moody's or A-1 by S&P.
A period of rising commercial interest rates may adversely affect the value of
the Portfolio and its net asset value per share. This may require rapid
portfolio turnover, with temporary investments in lower-yielding and taxable
instruments, to adjust the Portfolio to higher prevailing rates. Conversely,
portfolio values will tend to increase in periods of falling commercial rates.
Congress has periodically considered proposals to restrict or eliminate the
federal income tax exemption for interest on certain types of, or on all,
municipal obligations. Such legislation would affect the availability of
municipal obligations for investment and the value of the Portfolio's assets.
The Portfolio's income which is exempt from federal taxes is not generally
exempt from state and local income taxes.
SUB-ADVISER: AEGON USA Investment Management, Inc.
36
<PAGE>
<TABLE>
<CAPTION>
TAX-EXEMPT PORTFOLIO
SUMMARY OF EXPENSES CLASS OF SHARES
A B C
=============================================================================================================================
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases (as percentage of offering price) 4.75% None None
Redemption Fees ^(a) None None None
Deferred Sales Charge (as a percentage of original purchase price or redemption proceeds, None 5.00% None
whichever is lower) ^(b)
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
Management Fees 0.60% 0.60% 0.60%
12b-1 ^ Distribution and Service Fees 0.35% 1.00% 0.60%
Other Expenses (net of expense reimbursements and/or fee waivers^) (c) 0.05% 0.05% 0.05%
----- ----- -----
Total Operating Expenses (net of expense reimbursements and/or fee waivers^) (c) 1.00% 1.65% 1.25%
EXAMPLES
The tables below show the expenses you would pay on a ^ $1,000 investment over a
variety of time frames, assuming a 5% annual return. The first example assumes
redemption at the end of each period.
<S> <C> <C> <C> <C>
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A 57 78 100 164
B 67 82 100 178
C 13 40 69 151
The next example assumes no redemption and, therefore, no deferred sales charge.
Share Class 1 Year 3 Years 5 Years 10 Years
- ----------- ------ ------- ------- --------
A 57 78 100 164
B 17 52 90 178
C 13 40 69 151
^-------------------------------
^(a) A $10 service fee is charged for each redemption transaction paid by
Federal funds bank wire, and a $20 service fee is charged for each check
redemption sent via overnight delivery.
^(b) On certain purchases of Class A ^ shares in amounts greater than
$1,000,000, a contingent deferred sales charge of 1% applies for 12 months after
purchase.
^(c) See Ratio of Expenses to Average Net Assets in the Financial
Highlights section, and Note 10 to the Notes to Financial Highlights for further
discussion of expenses. ^ The percentages shown are for the fiscal year ended
September 30, 1996.
</TABLE>
The purpose of the Examples shown in the Summary of Expenses are to help you
understand the direct and indirect expenses an investor in each Portfolio may
bear. The Examples for Class B shares reflect conversion to Class A shares eight
years after purchase, and assume that the shareholder was the owner of shares on
the first day of the first year. For more information, see Investment Advisory
and Other Services and Shareholder Information and Instructions.
Long-term shareholders may pay more in 12b-1 fees than the economic equivalent
of the maximum sales charge permitted under the rules of the National
Association of Securities Dealers, Inc. ("NASD").
EXPENSES SHOWN IN THE EXAMPLES DO NOT REPRESENT ACTUAL PAST OR FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. THE ASSUMED 5% RETURN IS
HYPOTHETICAL, AND IS NOT A REPRESENTATION OR PREDICTION OF PAST OR FUTURE
RETURNS, WHICH MAY BE MORE OR LESS THAN 5%.
37
<PAGE>
<TABLE>
<CAPTION>
TAX-EXEMPT PORTFOLIO
FINANCIAL HIGHLIGHTS
NET
REALIZED TOTAL
AND INCOME DIVIDENDS DISTRIBUTIONS
NET ASSET NET UNREALIZED (LOSS) FROM FROM NET ASSET
VALUE INVESTMENT GAIN (LOSS) FROM NET REALIZED NET VALUE AT
YEAR OR PERIOD BEGINNING INCOME ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
ENDED (1) OF PERIOD (LOSS) INVESTMENTS INCOME INCOME GAINS DISTRIBUTIONS PERIOD
--------- --------- ------ ----------- ------ ------ ----- ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) $11.36 $0.18 $(0.09) $0.09 $(0.05) -- $(0.05) $11.40
9/30/96 $11.34 $2.13 $(1.48) $0.65 $(0.56) $(0.07) $(0.63) $11.36
9/30/95 $11.10 $0.55 $0.29 $0.84 $(0.56) $(0.04) $(0.60) $11.34
9/30/94 $12.07 $0.56 $(0.60) $(0.04) $(0.54) $(0.39) $(0.93) $11.10
9/30/93 $11.62 $0.56 $0.45 $1.01 $(0.54) $(0.02) $(0.56) $12.07
9/30/92 (7) $11.46 $0.54 $0.28 $0.82 $(0.54) $(0.12) $(0.66) $11.62
11/30/91 $11.27 $0.75 $0.26 $1.01 $(0.75) $(0.07) $(0.82) $11.46
11/30/90 $11.39 $0.78 $(0.12) $0.66 $(0.78) -- $(0.78) $11.27
11/30/89 $10.97 $0.78 $0.42 $1.20 $(0.78) -- $(0.78) $11.39
11/30/88 $10.44 $0.79 $0.53 $1.32 $(0.79) -- $(0.79) $10.97
11/30/87 $11.81 $0.77 $(1.37) $(0.60) $(0.77) -- $(0.77) $10.44
11/30/86 $10.56 $0.79 $1.42 $2.21 $(0.79) $(0.17) $(0.96) $11.81
CLASS B
10/31/96 (2) $11.36 $0.17 $(0.09) $0.08 $(0.04) -- $(0.04) $11.40
9/30/96 $11.34 $2.06 $(1.48) $0.58 $(0.49) $(0.07) $(0.56) $11.36
CLASS C
10/31/96 (2) $11.36 $0.17 $(0.09) $0.08 $(0.04) -- $(0.04) $11.40
9/30/96 $11.34 $2.10 $(1.48) $0.62 $(0.53) $(0.07) $(0.60) $11.36
9/30/95 $11.10 $0.52 $0.29 $0.81 $(0.53) $(0.04) $(0.57) $11.34
9/30/94 $12.07 $0.53 $(0.60) $(0.07) $(0.51) $(0.39) $(0.90) $11.10
NET ASSETS RATIO OF EXPENSES TO AVERAGE NET RATIO OF NET
AT END OF ASSETS (10) INCOME (LOSS) PORTFOLIO AVERAGE
YEAR OR PERIOD TOTAL PERIOD EXCLUDING INCLUDING TO AVERAGE TURNOVER COMMISSION
ENDED (1) RETURN (9) (000'S) CREDITS CREDITS GROSS NET ASSETS (16) RATE (11) RATE (12)
--------- ---------- ------- ------- ------- ----- --------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/96 (2) 0.76% $24,439 1.00% 1.00% 1.89% 4.60% 3.79% --
9/30/96 5.89% $24,708 1.00% 1.00% 1.46% 4.88% 71.05% --
9/30/95 7.75% $27,401 1.02% 1.00% 1.35% 4.83% 126.48% --
9/30/94 (0.41)% $29,096 1.00% -- 1.30% 4.83% 59.84% --
9/30/93 8.97% $30,717 1.00% -- 1.43% 4.83% 91.03% --
9/30/92 7.20% $28,363 1.00% -- 1.20% 5.49% 106.89% --
11/30/91 9.20% $28,242 0.95% -- 1.24% 6.67% 117.92% --
11/30/90 6.00% $22,708 0.68% -- 0.92% 6.92% 81.17% --
11/30/89 11.20% $15,916 0.70% -- 1.11% 6.98% 67.45% --
11/30/88 12.90% $11,805 0.70% -- 1.13% 7.28% 35.44% --
11/30/87 (5.20)% $8,833 0.64% -- 1.37% 7.16% 87.03% --
11/30/86 21.40% $3,112 1.21% -- 2.92% 6.89% 38.00% --
CLASS B
10/31/96 (2) 0.71% $198 1.65% 1.65% 2.54% 3.94% 3.79% --
9/30/96 5.21% $189 1.65% 1.65% 2.11% 4.23% 71.05% --
CLASS C
10/31/96 (2) 0.74% $939 1.25% 1.25% 2.14% 4.34% 3.79% --
9/30/96 5.63% $907 1.25% 1.25% 1.71% 4.63% 71.05% --
9/30/95 7.48% $454 1.27% 1.25% 1.60% 4.58% 126.48% --
9/30/94 (0.73)% $277 1.25% -- 20.88% 4.58% 59.84% --
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS ON PAGE 39
<PAGE>
38
<PAGE>
NOTES TO FINANCIAL HIGHLIGHTS
(1) Commencement of operations for Growth Portfolio Class A, Global Portfolio
Class A, IDEX Total Income Trust (predecessor to Flexible Income Portfolio Class
A), AEGON USA Tax-Exempt Portfolio (predecessor to Tax-Exempt Portfolio Class A)
and AEGON USA High Yield Portfolio (predecessor to Income Plus Portfolio Class
A) was May 8, 1986, October 1, 1992, June 29, 1987, April 1, 1985 and June 14,
1985, respectively. Commencement of operations for the Class C shares of Growth,
Global, Flexible Income, Tax-Exempt and Income Plus Portfolios was October 1,
1993. Commencement of operations for Class A and Class C shares of Balanced,
Capital Appreciation, Aggressive Growth and ^ Strategic Total Return Portfolios
was December 2, 1994. Commencement of operations for Class B shares of each of
the above Portfolios was October 1, 1995. Commencement of operations for Class
A, Class B and Class C shares of the Tactical Asset Allocation Portfolio was
October 1, 1995. Commencement of operations for Class A, Class B and Class C
shares of the C.A.S.E. Portfolio was February 1, 1996. Commencement of
operations for Class A, Class B and Class C shares of the International Equity
and Value Equity Portfolios was February 1, 1997.
(2) Calculations are for the one month period ended October 31, 1996. On October
1, 1996, the Fund changed its fiscal year end from September 30 to October 31.
(3) As of October 1, 1992, Growth Portfolio Class A and Flexible Income
Portfolio Class A discontinued the practice of equalization accounting.
(4) Prior to May 1, 1991, no 12b-1 fees were incurred by Growth Portfolio Class
A shares. Effective May 1, 1991, Growth Portfolio Class A shares incurred 12b-1
fees at the rate of 0.25% in accordance with the Plan of Distribution under Rule
12b-1 of the Investment Company Act of 1940. Effective October 1, 1993, Growth
Portfolio Class A shares' 12b-1 fee rate changed from 0.25% to 0.35%. Prior to
October 1, 1993, no 12b-1 fees were incurred by Flexible Income Portfolio Class
A shares. Effective October 1, 1993, Flexible Income Portfolio Class A shares
incurred 12b-1 fees at the rate of 0.35% in accordance with the Plan of
Distribution under Rule 12b-1 of the Investment Company Act of 1940.
(5) On October 1, 1993, IDEX Total Income Trust ("IDEX Total") was reorganized
into IDEX II Flexible Income Portfolio, which had no prior operating history as
of that date. Pursuant to the Agreement and Plan of Reorganization and
Liquidation, Flexible Income Portfolio acquired all of the assets and assumed
all of the liabilities of IDEX Total in exchange for Class A shares of Flexible
Income Portfolio. All historical financial information relates to IDEX Total
prior to the date it was reorganized into Flexible Income Portfolio.
(6) On August 7, 1992, AEGON High Yield Portfolio was reorganized into IDEX II
Income Plus Portfolio (formerly known as IDEX II High Yield Portfolio), which
had no prior operating history as of that date. Pursuant to the Agreement and
Plan of Reorganization and Liquidation, the Income Plus Portfolio acquired all
of the assets and assumed all of the liabilities of AEGON High Yield Portfolio
in exchange for shares of Income Plus Portfolio. All historical financial
information prior to August 7, 1992 relates to AEGON High Yield Portfolio.
(7) On August 7, 1992, AEGON Tax-Exempt Portfolio was reorganized into IDEX II
Tax-Exempt Portfolio, which had no prior operating history as of that date.
Pursuant to the Agreement and Plan of Reorganization and Liquidation, the
Tax-Exempt Portfolio acquired all of the assets and assumed all of the
liabilities of AEGON Tax-Exempt Portfolio in exchange for shares of Tax-Exempt
Portfolio. All historical financial information prior to August 7, 1992 relates
to AEGON Tax-Exempt Portfolio.
(8) On September 20, 1996, IDEX Fund and IDEX Fund 3 were reorganized into
Growth Portfolio Class T shares which had no prior operating history. Pursuant
to the Agreement and Plan of Reorganization and Liquidation, the Growth
Portfolio acquired all of the assets and assumed all of the liabilities of each
of IDEX Fund and IDEX Fund 3 in exchange for Class T shares of Growth Portfolio.
(9) Total return has been calculated without deduction of a sales load, if any,
on an initial purchase for Class A or Class T shares and assumes all dividends
and distributions are paid in additional shares. Short periods (where
applicable) are not annualized.
(10) Ratio of expenses to average net assets ^ show: Expenses Excluding Credits
(total expenses less amounts waived/reimbursed by the investment adviser); ^
Expenses Including Credits (total expenses less amounts waived/reimbursed by the
investment adviser and reduced by affiliated brokerage and custody earnings
credits); and ^ Gross Expenses (total expenses ^, not taking into account
waived/reimbursed amounts by the investment adviser ^ or affiliated brokerage
and custody earnings credits). Short periods (where applicable) are annualized.
(11) This rate is calculated by dividing the ^ lesser of the Portfolio's ^
respective long-term purchases or sales by the average value of its long-term
investments during the period. ^ Growth's acquisition of investment securities
of IDEX Fund and IDEX Fund 3 has been eliminated from the September 30, 1996
portfolio turnover calculation. Short periods (where applicable) are not
annualized.
39
<PAGE>
(12) This rate is calculated by dividing total commissions paid on purchases and
sales of securities during the period by total shares purchased or sold in those
same transactions and is reported for the periods ^ ended September 30, 1996 and
forward to the extent that commissionable trades constitute more than 10% of the
average net assets for the period.
(13) The information shown for Class T shares is for the period from inception
(September 20, 1996) through the fiscal year ended September 30, 1996.
(14) Distributions from net realized capital gains include distributions in
excess of current net realized capital gains.
(15) Distributions from net investment income include distributions in excess of
current net investment income.
(16) Short periods (where applicable) are annualized.
40
<PAGE>
PERFORMANCE/TOTAL RETURN
Mutual fund performance is most often stated as "total return." Total return,
expressed as a percentage, shows the change in value of fund shares, plus its
income and capital gain distributions, net of expenses or sales charges, from
the beginning of a period to the end of a period. Total return may be annual --
the return achieved in a year -- or cumulative, over a period of several years.
Performance is calculated separately for each class of shares.
You may also see a Portfolio's performance described in terms of "average annual
total return." This rate shows the hypothetical annual compounded return that
would have produced the same cumulative return if performance had been constant
over the entire period. Because average annual returns for more than one year
tend to smooth out variations in performance, such figures are not the same as
actual year-by-year results.
The SAI contains a more detailed description of the method used to calculate
average annual total return for each Portfolio.
YIELD
The current 30-day yield for a class of shares of the Flexible Income,
Tax-Exempt or Income Plus Portfolios is based on the investment income earned
during a particular 30-day period (including dividends, if any, and interest),
less expenses (excluding reductions for affiliated brokerage and custody
earnings credits) accrued during that period, divided by average shares
outstanding during the period, and divided by the maximum offering price per
share on the last day of the period. The resulting figure is multiplied by 12
for an annual yield.
PERFORMANCE SHOWN IN ADVERTISING
The Portfolios may advertise their returns in non-standard ways, or for periods
in addition to those required by the NASD and SEC. The Portfolios may also
advertise returns without deducting sales charges; such returns would appear
higher than actual returns which reflect sales charges.
Each class of shares of the Tax-Exempt Portfolio may advertise its "taxable
equivalent yield." This figure shows the percentage yield an investor in a given
tax bracket -- typically the highest -- would have to earn on a taxable
investment in order to equal the tax-exempt income of the Portfolio.
COMMERCIAL PERFORMANCE RANKINGS AND COMPARISONS TO STANDARD INVESTING INDEXES
The Portfolios may sometimes advertise their "Lipper Rankings" or "Morningstar
Ratings", or other ratings or rankings published by business magazines or
newspapers such as Forbes, Money, The Wall Street Journal, Business Week,
Barron's, Changing Times, CDA/Wiesenberger Investment Technologies, Fortune or
Institutional Investor. These rankings or ratings may include criteria relating
to Portfolio characteristics, as well as to performance.
When the Portfolios advertise such rankings or ratings relating to the Portfolio
performance, information will be included about the ranking category, the number
of funds in the category, the period and criteria on which the ranking is based
and the effect of sales charges, fee waivers and/or expense reimbursements.
A Portfolio may also compare its performance to other selected funds or to
recognized market indexes, such as the Standard & Poor's 500 Stock Index (the
"S&P 500"), the Dow Jones Industrial Average, the Standard & Poor's MidCap
Index, the Russell 2000, the NASDAQ Composite, the Lehman Brothers Intermediate
Government Corporate Bond Index, the Lehman Brothers Long Government Corporate
Bond Index, the Merrill Lynch High Yield Master Index, the Lehman Brothers Long
Municipal Bond Index or the Morgan Stanley Capital International World Index.
The International Equity and Global Portfolios' performance may be compared to
the record of global market indicators such as the Morgan Stanley Capital
International Europe, Australia, Far East Index ("EAFE Index"). The EAFE Index
is an unmanaged index of foreign common stock prices translated into U.S.
dollars.
In addition, a Portfolio may make appropriate comparisons of its performance to
the performance of other types of investments, including certificates of
deposit, savings accounts and U.S. Treasury securities, or of certain interest
rate and inflation indexes, such as the Consumer Price Index.
41
<PAGE>
All performance figures are based on historical results and are not intended to
predict future performance. The investment return and principal value of an
investment will fluctuate so that an investor's shares, when sold, may be worth
more or less than their original cost.
SECURITIES IN WHICH THE PORTFOLIOS INVEST
A Portfolio's potential risks and rewards are achieved fundamentally from the
investments it makes. Certain limitations may apply to Portfolio investments.
Unless otherwise indicated, all limitations apply at the time of investment.
Limitations on borrowing and investments in illiquid securities apply on a
continuous basis. This section discusses those securities with special
risk/reward considerations. This section should be read together with the
section called Additional Risk Factors.
FOREIGN SECURITIES
Subject to the following limitations, eleven of the thirteen Portfolios may
invest directly in foreign securities denominated in a foreign currency and not
publicly traded in the United States.
o The Growth, Balanced, Capital Appreciation, Aggressive Growth, Tactical
Asset Allocation, C.A.S.E. and Value Equity Portfolios may invest up to 25%
of their individual net assets, directly or indirectly, in foreign
securities.
o The Global and International Equity Portfolios may invest without limit in
foreign securities.
o The ^ Strategic Total Return Portfolio may invest up to 25% of its net
assets directly or indirectly in foreign securities, provided that no more
than 10% of its total assets may be invested directly in such securities
denominated in foreign currency and not publicly traded in the United
States.
o The Flexible Income Portfolio may invest up to 50% of its net assets,
directly or indirectly, in foreign securities, provided that no more than
25% of its total assets may be invested in the securities of the government
or private issuers of any one foreign country.
In addition to direct foreign investment, these Portfolios may also invest in
foreign securities through American Depositary Receipts ("ADRs") or American
Depositary Shares ("ADSs"), which are dollar-denominated receipts issued by
domestic banks or securities firms. ADRs and ADSs are publicly traded on U.S.
exchanges, and may not involve the same risks as securities denominated in
foreign currency.
Each of these Portfolios may also indirectly invest in foreign securities
through European Depositary Receipts ("EDRs"), which are typically issued by
European banks; in Global Depositary Receipts ("GDRs"), which may be issued by
domestic or foreign banks; and in other types of receipts evidencing ownership
of foreign securities.
Investments in foreign securities involve different risks from investing in
domestic securities. See Additional Risk Factors.
FUTURES, OPTIONS AND OTHER DERIVATIVE INSTRUMENTS
Each of the Portfolios, other than the Tax-Exempt and Income Plus Portfolios,
may write and purchase options on securities, as well as engage in transactions
involving options on securities or foreign currencies, futures contracts,
options on futures contracts, forward currency contracts, and interest rate
swaps, caps and floors. These instruments are commonly called derivatives,
because their price is derived from an underlying index, security or other
measure of value.
These Portfolios use derivatives primarily as a hedge -- for example, to protect
portfolio positions against market or currency swings, to gain market exposure
for accumulating and residual cash balances pending investment in securities, to
adjust a Portfolio's overall maturity duration, or to reduce the risk inherent
in the management of the Portfolio involved.
Futures contracts and related options may be used to attempt to enhance profit,
but each Portfolio limits non-hedging use of such instruments by requiring that
the aggregate initial margin and premiums required to establish non-hedging
positions will not exceed 5% of the fair market value of such Portfolio's net
assets.
The Value Equity, ^ Strategic Total Return and Tactical Asset Allocation
Portfolios do not currently intend to purchase or sell any derivatives during
the fiscal year ending October 31, 1997. However, they may do so in the future.
The Flexible Income Portfolio may also write and purchase options on securities
to attempt to enhance income. Call options, which give the buyer the right to
"call away" a portfolio security at a designated price until a certain date,
must be "covered" -- that is, the Portfolio must own the securities required to
fulfill the contract.
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The Income Plus Portfolio may purchase and sell contracts for the future
delivery of fixed-income securities at an established price, commonly called
"interest rate futures contracts." It does so only for the purpose of hedging
against anticipated interest rate changes that would adversely affect the value
of Portfolio securities. The Portfolio will maintain cash or cash equivalents
equal in value to the market value of futures contracts purchased (less related
margin deposits) to assure that its position is fully collateralized and that
its use of such contracts is minimally leveraged.
The Aggressive Growth Portfolio intends to use derivatives for hedging as well
as to enhance income, subject to these limitations:
o The Portfolio may write covered call options on common stocks that it owns
or has an immediate right to acquire through conversion or exchange of
other securities in an amount not to exceed 25% of total assets.
o The Portfolio does not intend to write any put options.
o The Portfolio may buy only those options listed on a national securities
exchange.
o The Portfolio will not purchase options if, as a result, the aggregate cost
of all outstanding options exceeds 10% of the Portfolio's total assets.
o No more than 5% of the Portfolio's total assets will be committed to
non-hedging transactions.
o The Portfolio will buy and sell stock index futures contracts and options
on stock index futures only for hedging or other permissible
risk-management purposes, not for speculation. Aggregate initial margins
and premiums on such investments may not be more than 5% of the Portfolio's
total assets.
The Portfolios' futures contracts activities are limited in such a manner as to
qualify for certain exemptions from registration with the Commodity Futures
Trading Commission.
There can be no assurance that the use of derivatives will help a Portfolio
achieve its investment objective. Derivatives involve special risks. See
Additional Risk Factors.
For more information about derivatives and their risks, see the SAI.
MORTGAGE AND OTHER ASSET-BACKED SECURITIES
Each Portfolio may invest up to 25% of its net assets in mortgage- and other
asset-backed securities. These are subject to prepayment risk -- the possibility
that early payoffs of underlying mortgages or other loans will cause the
principal and interest on the security to be paid before its stated maturity.
These early payments are more likely during periods when long-term interest
rates decline. In the event of such a prepayment during an interest rate
decline, a Portfolio may be required to invest the unanticipated proceeds at a
lower interest rate. Prepayments during such periods will also limit a
Portfolio's ability to participate in the kind of market gains possible with
comparable government securities not subject to prepayment.
The Value Equity Portfolio does not currently intend to invest in these types of
securities during the fiscal year ended October 31, 1997, although it may do so
in the future.
CONVERTIBLE SECURITIES
The Portfolios may invest in varying degrees in convertible securities, which
may include corporate notes or preferred stock, but ordinarily are long-term
debt obligations which are convertible at a stated rate and time into common
stock of the issuer.
As with all debt securities, the market value of convertibles tends to decline
as interest rates rise and to increase as interest rates fall. Convertible
securities generally offer lower interest rates or dividend yields than
non-convertible securities of similar quality. However, when the market price of
the common stock underlying a convertible exceeds the conversion price, the
price of the convertible tends to rise like the common stock price. When the
price of the underlying stock declines, the convertible tends to trade
increasingly on a yield basis; therefore, its price may not fall as much as the
price of the common stock.
Convertible securities generally rank senior to common stocks in an issuer's
capital structure. That means convertible obligations are supposed to be paid
off before common stock obligations. Consequently, most convertibles are of
higher quality and entail less risk of decline in market value than the issuer's
common stock. However, the extent to which such risk is reduced depends largely
on the market
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value of the convertible as a debt security -- i.e., if compared to other debt
securities, the convertible pays a competitive rate and is in demand, its price
will hold up.
Each Portfolio that invests primarily in equity securities may invest in
convertibles as a substitute for common stock. When investing in convertible
debt securities, each Portfolio will evaluate them for potential investment
using the same ratings criteria as such Portfolio would use for investments in
non-convertible debt securities. See Securities in Which the Portfolios Invest -
Debt Securities.
WHEN-ISSUED, DELAYED DELIVERY AND FORWARD TRANSACTIONS
Each Portfolio, other than the Tax-Exempt and Tactical Asset Allocation
Portfolios, may buy securities on a when-issued or delayed delivery basis. They
may also enter into contracts to buy securities for a fixed price at a future
date beyond normal settlement time ("forward commitments"). The Tax-Exempt
Portfolio may purchase municipal bonds on a when-issued or delayed delivery
basis. The Portfolios bear the risk that the value of such securities may change
before delivery and the risk that the seller may not complete the transaction.
See Appendix B for more information.
ILLIQUID SECURITIES
Each of the Portfolios, other than the Tax-Exempt and Income Plus Portfolios,
may invest as much as 15% of their net assets in securities that are considered
illiquid. The Tax-Exempt and Income Plus Portfolios may invest as much as 10% of
their net assets in such securities.
Securities may be considered illiquid if there is no readily available market
for them, or if they carry legal or contractual restrictions on resale. It often
takes more time to sell illiquid securities, and costs more in brokerage or
dealer discounts or other expenses than does the sale of exchange-listed
securities or securities traded over-the-counter. As a result, a Portfolio may
not be able to sell such securities readily when the sub-adviser thinks it
proper to do so. The sub-adviser may have to sell an alternative security in
order to meet short-term needs for cash such as shareholder redemption requests
at a time that may not be advantageous.
Certain securities, called Rule 144A securities, are not registered for sale to
the public, but may be sold to certain institutional investors. Rule 144A
securities may be considered liquid if a dealer or an institutional market
exists for them. Procedures have been established by the Portfolios'
sub-advisers and Board of Trustees to determine if certain Rule 144A securities
and other securities, including commercial paper, are liquid. Under similar
procedures for the Flexible Income and Tax-Exempt Portfolios, the sub-adviser
and Board of Trustees may determine that certain municipal leases are liquid.
Securities purchased under these rules may later become illiquid. The
Portfolios' investments in such securities could have the effect of increasing
the level of Portfolio illiquidity to the extent that a dealer or institutional
trading market declines. To the extent such securities are determined to be
liquid, they will not be subject to the percentage limitations described above.
The Tactical Asset Allocation Portfolio does not currently intend to invest in
illiquid securities.
ZERO COUPON BONDS AND OTHER SECURITIES
Each of the Portfolios, other than the Aggressive Growth and Value Equity
Portfolios, may invest as much as 10% of their assets in zero coupon bonds, step
coupon bonds, pay-in-kind securities or strips.
o Zero coupon bonds do not make regular interest payments. They are sold at a
discount from face value. Principal and accreted discount (representing
interest accrued but not paid) are paid at maturity.
o Step coupon bonds sell at a discount and pay a low coupon rate for an
initial period, then pay a higher coupon rate thereafter.
o Pay-in-kind securities may pay interest in cash or in the form of a similar
bond or other asset.
o Strips are debt securities that are stripped of their interest after the
securities are issued, but are comparable to zero coupon bonds.
The market value of these four kinds of securities generally fluctuates more in
response to interest rate changes than does the market value of interest-paying
securities of comparable quality and term. The Portfolios may realize greater
gains or losses as a result of such fluctuations.
To pay cash distributions from income earned on these kinds of securities, the
Portfolios may sell certain securities and may incur a capital gain or loss on
the sale.
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REPURCHASE AND REVERSE REPURCHASE AGREEMENTS
Each of the Portfolios may invest in repurchase and reverse repurchase
agreements. In a repurchase agreement, the Portfolio buys a security and
simultaneously agrees to resell it to the seller, generally a bank or
broker-dealer who agrees to repurchase the security, at a specified price and
date or on demand. This technique is a method of earning income on idle cash.
The repurchase agreement is effectively secured by the value of the underlying
security.
If a seller fails to repurchase the security as agreed, the Portfolio may suffer
a loss if the security's value declines before it can be sold on the open
market. If the seller goes bankrupt, a Portfolio may encounter delays and
increased costs in selling the underlying security.
Repurchase agreements maturing in more than seven days are subject to the limits
described above on illiquid securities.
In a reverse repurchase agreement, a Portfolio sells a security to another party
such as a bank or broker-dealer in return for cash and the Portfolio agrees to
buy the security back at a future date and price. These agreements may provide
cash to satisfy unusually heavy redemption requests or for other temporary or
emergency purposes without actually selling portfolio securities. They also may
help earn additional income on securities like treasury bills and notes.
U.S. GOVERNMENT SECURITIES
Each of the Portfolios may invest in U.S. government securities, which are debt
securities backed either by the credit of the U.S. government as a whole or only
by the credit of the issuing agency or instrumentality. Securities issued by the
Federal Home Loan Banks and the Federal National Mortgage Association (FNMA) are
supported by the agency's right to borrow money from the U.S. Treasury under
certain circumstances. U.S. Treasury bonds, notes and bills, and some agency
securities, such as those issued by the Government National Mortgage Association
(GNMA), are backed by the full faith and credit of the U.S. government as to
payment of principal and interest and are the highest quality U.S. government
securities.
DEBT SECURITIES
None of the Portfolios, other than the Value Equity, ^ Strategic Total Return,
Flexible Income and Income Plus Portfolios, may invest more than 5% of its net
assets in junk bonds. The Flexible Income Portfolio may invest without limit,
the Income Plus Portfolio may invest up to 50% of its total assets, and each of
the Value Equity and ^ Strategic Total Return Portfolios may invest up to 10% of
its total assets, in junk bonds, or in the case of the Value Equity and ^
Strategic Total Return Portfolios, in convertible securities rated lower than
investment grade. Bonds rated below investment grade are commonly known as "junk
bonds" and normally involve greater risk than investment grade securities. (See
Additional Risk Factors.)
The Aggressive Growth and C.A.S.E. Portfolios may invest in debt securities
rated only in the three highest categories by Moody's (Aaa, Aa or A) or S&P
(AAA, AA or A).
The Tactical Asset Allocation Portfolio will limit investments in commercial
paper to obligations rated Prime-1 by Moody's or A-1 by S&P.
The Portfolios may also buy unrated securities that, in the sub-adviser's
opinion, are equal in quality to the Portfolio's rated debt securities.
Unrated debt securities are not necessarily of lower grade than rated
securities, but they may not be as attractive to some buyers. The Portfolios
rely on the credit analysis of their sub-advisers when investing in unrated debt
securities.
See the IDEX Tax-Exempt Portfolio - Primary Investment Practices for a
discussion of the Portfolio's investments in debt securities.
OTHER INVESTMENT COMPANIES
Certain of the Portfolios may invest in securities issued by other investment
companies, within limits described in the SAI and in accordance with the 1940
Act. These limitations do not apply to investments by the International Equity
Portfolio in the GEI Short-Term Investment Fund, as described under How the
Portfolios Invest - Cash Positions and Debt Investing by Stock Portfolios. A
Portfolio may indirectly bear its proportionate share of any investment advisory
fees and expenses paid by the funds in which it invests, in addition to the
investment advisory fee and expenses paid by such Portfolio.
The International Equity Portfolio may invest in investment funds which have
been authorized by the governments of certain countries specifically to permit
foreign investment in securities of companies listed and traded on the stock
exchanges in these countries.
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BANK OBLIGATIONS
Subject to its investment policy, during temporary defensive periods, a
Portfolio may invest up to 100% of its assets in bank obligations such as CDs or
time deposits. Certain characteristics of the banking industry and the possible
risks of such investments might be:
o banks are subject to extensive governmental regulations which may limit the
amounts and types of loans and other financial commitments, as well as
interest rates and fees which may be charged;
o profitability is largely dependent upon the availability and cost of
capital funds for the purpose of financing lending operations under
prevailing money market conditions; and
o exposure to credit losses arising from possible financial difficulties of
borrowers might affect a bank's ability to meet its obligations.
HOW THE PORTFOLIOS INVEST
A Portfolio's potential risks and rewards are affected by the investment
techniques practiced by the Portfolio. This section discusses investing
techniques with special risk/reward considerations.
DIVERSIFICATION
Diversification is the practice of spreading a portfolio's assets over a number
of investments, investment types, industries or countries to reduce risk. A
non-diversified portfolio has the ability to take larger positions in fewer
issuers. Because the appreciation or depreciation of a single security may have
a greater impact on the net asset value of a non-diversified portfolio, its
share price can be expected to fluctuate more than a comparable diversified
portfolio.
Each of the Portfolios other than the Capital Appreciation Portfolio is
diversified as a matter of fundamental policy, and is defined as a diversified
investment company under the 1940 Act. With respect to 75% of its total assets,
a diversified investment company may not purchase the securities of any one
issuer (other than government securities), if immediately after and as a result
of such purchase, the value of the holdings of the securities of such issuer
exceeds 5% of the value of the Portfolio's total assets, or the Portfolio owns
more than 10% of the outstanding voting securities of any one class of
securities of such issuer. The Capital Appreciation Portfolio is a
nondiversified investment company.
As a fundamental policy governing concentration, each of the Portfolios will not
invest 25% or more ^ of total assets in any one particular industry, other than
U.S. government securities.
The Capital Appreciation Portfolio reserves the right to become a diversified
investment company (as defined by the 1940 Act). Currently, however, its
policies are as follows:
With respect to 50% of its assets, the Capital Appreciation Portfolio will not
buy the securities of any one issuer (other than cash items and U.S. government
securities) if, as a result, the Portfolio
o owns more than 10% of the outstanding voting securities of that issuer; or
o the value of the Portfolio's holdings of that issuer exceeds 5% of the
value of the Portfolio's total assets.
The Capital Appreciation Portfolio may invest as much as 50% of its assets in
the securities of as few as two issuers. However, it does not expect to do so
unless its sub-adviser sees the potential for substantial capital appreciation
in such an investment. The Portfolio does intend to take advantage of the
flexibility of its nondiversification policy by investing more than 5% of total
assets in the securities of one issuer.
To the extent that the Portfolio makes such single large investments, it
increases its exposure to credit and/or market risks, and to the profit
potential, associated with a single issuer. Both profit potential and risk are
greater in a nondiversified portfolio than in a diversified portfolio.
See The IDEX Series Fund - Introduction to the Portfolios: ^ Investment
Practices and Risks for a discussion of the individual Portfolios'
diversification styles.
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PORTFOLIO TURNOVER
Although it is the policy of each Portfolio, other than the Tax-Exempt and
Income Plus Portfolios, to buy and hold securities for their stated investment
objectives, changes in these holdings will be made whenever the respective
portfolio managers believe they are advisable. Such changes may result from:
o liquidity needs;
o securities having reached a price or yield objective;
o anticipated changes in interest rates or the credit standing of an issuer;
or
o developments not foreseen at the time of the investment decision.
To a limited extent, these Portfolios may engage in a significant number of
short-term transactions if such investing serves their objectives. The rate of
portfolio turnover will not be a limiting factor when such short-term investing
is considered appropriate. The Value Equity Portfolio will not normally engage
in short-term trading, but reserves the right to do so.
The estimated annual portfolio turnover rate of the Value Equity Portfolio is
expected to average less than 50%. The estimated annual portfolio turnover rate
of the International Equity Portfolio is expected to range between 100% and
200%.
The investment policies of the Tax-Exempt and Income Plus Portfolios may lead to
frequent changes in investments, particularly when interest rates fluctuate
rapidly. Securities may be sold in anticipation of a decline in portfolio value
(a rise in interest rates) or bought in anticipation of an increase in portfolio
value (a fall in interest rates).
In addition, a security may be sold and another bought at approximately the same
time to take advantage of a temporary disparity, in the manager's judgment, in
the normal yield relationship between the two securities. These yield
disparities may occur for reasons not directly related to the investment quality
of particular issues or to the general movement of interest rates; instead, this
disparity may come about because of changes in the overall demand for or supply
of various types of securities or because of changes in the objectives of
investors in such securities.
Turnover rate will not limit a manager's ability to buy or sell securities for
the Portfolios. Certain tax rules may restrict a Portfolio's ability to sell
securities when the security has been held for less than three months.
Increased turnover (100% or more) results in higher brokerage costs or mark-up
charges for a Portfolio; these charges are ultimately borne by the shareholders.
Short-term trading may also result in short-term capital gains, which are taxed
as ordinary income to the Portfolio's shareholders.
For historical Portfolio turnover rates, see Financial Highlights. For more
discussion of portfolio turnover, see the SAI.
CASH POSITIONS AND DEBT INVESTING BY STOCK PORTFOLIOS
The Portfolios may at times choose to hold some portion of their net assets in
cash, or to invest that cash in a variety of debt securities. This may be done
as a defensive measure at times when desirable risk/reward characteristics are
not available in stocks or to earn income from otherwise uninvested cash. When a
Portfolio increases its cash or debt investment position, its income may
increase while its ability decreases to participate in stock market declines or
advances.
The International Equity Portfolio may also invest in the GEI Short-Term
Investment Fund (the "Investment Fund"), ^ an investment fund created
specifically to serve as a vehicle for the collective investment of cash
balances of the Portfolio and other accounts advised by GEIM or its affiliate,
General Electric Investment Corporation ("GEIC"). The Investment Fund invests
exclusively in the money market instruments described in (i) through (vii)
below. The Investment Fund is advised by GEIM. No advisory fee is charged by
GEIM to the Investment Fund, nor will a Portfolio incur, directly or indirectly,
any sales charge, redemption fee, distribution fee or service fee in connection
with its investments in the Investment Fund. The Portfolio may invest up to 25%
of its total assets in the Investment Fund. The types of money market
instruments in which the International Equity Portfolio may invest directly or
indirectly through its investment in the Investment Fund are as follows: (i)
securities issued or guaranteed by the U.S. government or one of its agencies or
instrumentalities; (ii) debt obligations of banks, savings and loan
institutions, insurance companies and mortgage bankers; (iii) commercial paper
and notes, including those with variable and floating rates of interest; (iv)
debt obligations of foreign branches of U.S. banks, U.S. branches of foreign
banks and foreign branches of foreign banks; (v) debt obligations issued or
guaranteed by one or more foreign governments or any of their
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political subdivisions, agencies or instrumentalities, including obligations of
supranational entities; (vi) debt securities issued by foreign issuers; and
(vii) repurchase agreements. The Investment Fund is not registered with the SEC
as an investment company.
SHORT SALES
Each of the Portfolios may sell securities "short against the box." A short sale
is a sale of a security that the Portfolio does not own. A short sale is
"against the box" if, at all times when the short sale is open, the Portfolio
owns an equal amount of the securities sold short or convertible into those same
securities, or exchangeable without further consideration for, securities of the
same issue as the securities sold short.
BORROWING AND LENDING
Each Portfolio, other than the Aggressive Growth Portfolio, may borrow money
from banks for temporary or emergency purposes. The amount borrowed shall not
exceed 25% of total assets for the Capital Appreciation, Global, Growth,
C.A.S.E., ^ Strategic Total Return, Tactical Asset Allocation, Balanced and
Flexible Income Portfolios, 33 1/3% of total assets for the International
Equity, Income Plus and Tax-Exempt Portfolios, and 10% of total assets for the
Value Equity Portfolio.
To secure borrowings, a Portfolio may not mortgage or pledge its securities in
amounts that exceed 15% of its net assets for the International Equity, Capital
Appreciation, Global, Growth, C.A.S.E., ^ Strategic Total Return, Tactical Asset
Allocation, Balanced and Flexible Income Portfolios, and 10% of net assets for
the Value Equity, Income Plus and Tax-Exempt Portfolios.
The Tactical Asset Allocation Portfolio does not currently intend to borrow.
The Capital Appreciation, Global, Growth, Balanced and Flexible Income
Portfolios may borrow money from or lend money to other funds that permit such
transactions and that are advised or sub-advised by Janus Capital Corporation
("Janus Capital"), provided that Janus Capital obtains permission to do so from
the SEC. There is no assurance that such permission will be granted.
The Aggressive Growth Portfolio may borrow for investment purposes -- this is
called "leveraging." The Portfolio may borrow only from banks, not from other
investment companies.
The 1940 Act requires that a Portfolio maintain continuous asset coverage of
300% of the amount borrowed -- that is, total assets including borrowings, less
liabilities exclusive of borrowings, must be three times the amount borrowed.
There are risks associated with leveraging, which is a speculative technique.
o If the Portfolio's asset coverage drops below 300% of borrowings, the
Portfolio may be required to sell securities within three days to reduce
its debt and restore the 300% coverage, even though it may be
disadvantageous to do so.
o Leveraging may exaggerate the effect on net asset value of any increase or
decrease in the market value of the Portfolio's securities.
o Money borrowed for leveraging will be subject to interest costs. In certain
cases, interest costs may exceed the return received on the securities
purchased.
o The Portfolio may be required to maintain minimum average balances in
connection with borrowing or to pay a commitment or other fee to maintain a
line of credit. Either of these requirements would increase the cost of
borrowing over the stated interest rate.
State law and regulations may impose additional limits on the Portfolio's
borrowing. To the extent that any Portfolio purchases securities when the amount
that it has borrowed, even for temporary or emergency purposes, exceeds 5% of
its total assets, the Portfolio is engaged in leveraging. For more information
about borrowing and lending, see the SAI.
LENDING PORTFOLIO SECURITIES
Each of the Portfolios other than the Tax-Exempt and Income Plus Portfolios may
lend securities to broker-dealers and financial institutions to realize
additional income. As a fundamental policy, these Portfolios (except for the
Aggressive Growth Portfolio) will not lend securities or other assets if, as a
result, more than 25% (or 30% in the case of the International Equity Portfolio)
of total assets would be lent to other parties. In practice, at this time, none
of these Portfolios intends to lend securities or make any other loans valued at
more than 5% of total assets.
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As a fundamental policy, the Aggressive Growth Portfolio may not make loans to
others, except through buying qualified debt obligations, lending portfolio
securities or entering into repurchase agreements. The Aggressive Growth
Portfolio will not lend securities or other assets if, as a result, more than
20% of its total assets would be loaned to other parties.
If the borrower of a security defaults, the Portfolio may be delayed or
prevented from recovering collateral, or may be otherwise required to cover a
transaction in the security loaned. If portfolio securities are loaned,
collateral values must be continuously maintained at no less than 100% by
pricing both the securities loaned and the collateral daily. If a material event
is to be voted upon affecting a Portfolio's investment in securities which are
on loan, the Portfolio will take such actions as may be appropriate in order to
vote its shares. For more information about lending securities, see the SAI.
JOINT TRADING ACCOUNTS
Subject to approval by the Fund's Board of Trustees, the Growth, Global,
Flexible Income, Balanced and Capital Appreciation Portfolios may transfer
uninvested cash balances on a daily basis into certain joint trading accounts.
Assets in the joint trading accounts are invested in money market instruments.
All other participants in the joint trading accounts will be registered mutual
funds or other clients of Janus Capital or its affiliates. These Portfolios will
participate in the joint trading accounts only to the extent that the
investments of the joint trading accounts are consistent with each Portfolio's
investment policies and restrictions. Janus Capital anticipates that the
investments made by a Portfolio through the joint trading accounts will be at
least as advantageous to that Portfolio as if the Portfolio had made such
investment directly.
MASTER FUND/FEEDER FUND OPTION
The Fund may in the future seek to achieve the investment objective of each
Portfolio, other than the Income Plus and Tax-Exempt Portfolios, by investing
all of a Portfolio's assets in another investment company having the same
objective and substantially the same investment policies and restrictions.
Such an investment would be made only if the Board of Trustees of the Fund
determines it would be in the best interests of the Portfolio and its
shareholders. In making this determination, the Board will consider benefits to
shareholders and the opportunities to reduce costs and increase efficiency,
among other things. Should such a determination be made, shareholders will be
given at least 30 days notice.
CHANGES IN INVESTMENT POLICIES AND RULES
Each Portfolio is subject to investment restrictions, certain of which are
fundamental policies of that Portfolio. As such, they may not be changed without
shareholder approval. Non-fundamental investment restrictions and operating
policies may be changed by the Board of Trustees without shareholder approval.
The investment restrictions of each Portfolio are described in the SAI.
NEW INVESTMENT INSTRUMENTS
The sub-advisers reserve the right to evaluate new financial instruments as they
are developed and become actively traded. Subject to any applicable investment
restriction, a Portfolio may invest in any such investment products that its
manager believes will further the Portfolio's investment objective.
ADDITIONAL RISK FACTORS
All investments involve risks. Some securities and some investment practices
involve taking special or additional risks. This section describes a number of
those risk factors.
FOREIGN SECURITIES
Investments in foreign securities involve risks that are different in some
respects from investments in securities of U.S. issuers. These risks include:
CURRENCY VALUE. Changes in currency exchange rates may affect the value of
foreign securities and the value of their dividend or interest payments and,
therefore, a Portfolio's share price and returns. Currency exchange rates are
affected by numerous factors, including relative interest rates, balances of
trade, levels of foreign investment and manipulation by central banks. The
foreign currency market is essentially
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unregulated and can be subject to speculative trading. From time to time, many
countries impose exchange controls which limit or prohibit trading in certain
currencies.
CURRENCY TRADING COSTS. ADRs do not involve the same direct currency and
liquidity risks as securities denominated in foreign currencies. However, the
value of the currency in which the foreign security represented by the ADR is
denominated may affect the value of the ADR.
To the extent that a Portfolio invests in foreign securities denominated in
foreign currencies, its share price reflects the price movements both of its
securities and of the currencies in which they are denominated. The share price
of a Portfolio that invests in both U.S. and foreign securities may have a low
correlation with movements in the U.S. markets. If most of the securities in a
Portfolio are denominated in foreign currencies or depend on the value of
foreign currencies, the relative strength of the U.S. dollar against those
foreign currencies may be an important factor in that Portfolio's performance. A
Portfolio incurs costs in converting foreign currencies into U.S. dollars, and
vice versa.
DIFFERENT ACCOUNTING AND REPORTING PRACTICES. Foreign companies are generally
subject to tax laws and to accounting, auditing and financial reporting
standards, practices and requirements different from those that apply in the
U.S.
LESS INFORMATION AVAILABLE. There is generally less public information available
about foreign companies.
LESS REGULATION. Many foreign countries have less stringent securities
regulations than the U.S.
MORE DIFFICULT BUSINESS NEGOTIATIONS. A Portfolio may find it difficult to
enforce obligations in foreign countries or to negotiate favorable brokerage
commission rates.
REDUCED LIQUIDITY/INCREASED VOLATILITY. Some foreign securities are less liquid,
and their prices more volatile, than securities of comparable U.S. companies.
SETTLEMENT DELAYS. Settling foreign securities transactions may take longer than
settlements in the U.S.
HIGHER CUSTODY CHARGES. Custodianship of shares may cost more for foreign
securities than it does for U.S. securities.
ASSET VULNERABILITY. In some foreign countries, there is a risk of direct
seizure or appropriation through taxation of assets of a Portfolio. Certain
countries may also impose limits on the removal of securities or other assets of
a Portfolio. Interest, dividends and capital gains on foreign securities held by
a Portfolio may be subject to foreign withholding taxes.
POLITICAL INSTABILITY. In some countries, political instability, war or
diplomatic developments could affect investments.
These risks may be greater in developing countries or in countries with limited
or developing capital markets. In particular, developing countries may have
relatively unstable governments, economies based on only a few industries, and
securities markets that trade only a small number of securities. As a result,
securities of issuers located in developing countries may have limited
marketability and may be subject to abrupt or erratic price fluctuations.
At times, the Portfolios' foreign securities may be listed on exchanges or
traded in markets which are open on days (such as Saturday) when the Portfolios
do not compute a price or accept orders for purchase, sale or exchange of
shares. As a result, the net asset value of the Portfolios may be significantly
affected by trading on days when shareholders cannot make transactions.
HEDGING FOREIGN CURRENCY TRANSACTIONS. A Portfolio may hedge some or all of its
investments denominated in a foreign currency against a decline in the value of
that currency. For example, a Portfolio may buy or sell securities while using
forward currency contracts to fix a price in U.S. dollars for securities it has
agreed to buy or sell ("transaction hedge"). A Portfolio may enter into
contracts to sell a foreign currency for U.S. dollars (not exceeding the value
of a given Portfolio's assets denominated in that currency) or by participation
in options or futures contracts with respect to a currency ("position hedge").
A Portfolio could hedge a position by selling a second currency, which is
expected to perform similarly to the currency in which portfolio investments are
denominated or exposed, for U.S. dollars ("proxy hedge"). Or it may enter into a
forward contract to sell the currency in which the security is denominated for a
second currency that is expected to perform better relative to a given currency,
if the portfolio manager believes there is a reasonable degree of correlation
between movements in the two currencies ("cross-hedge").
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As an operating policy, a Portfolio will not commit more than 10% of its assets
to the consummation of cross-hedge contracts, and will either cover such
transactions with liquid portfolio securities denominated in the applicable
currency or segregate liquid assets in the amount of such commitments. In
addition, when a Portfolio anticipates buying securities denominated in a
particular currency, it may enter into a forward contract to purchase such
currency in exchange for the U.S. dollar or another currency ("anticipatory
hedge").
These strategies seek to minimize the effect of currency appreciation as well as
depreciation, but do not protect against a decline in the underlying value of
the hedged security. In addition, such strategies may reduce or eliminate the
opportunity to profit from increases in the value of the original currency, and
may adversely affect a Portfolio's performance if the manager's projection of
future exchange rates is wrong.
FUTURES, OPTIONS AND OTHER DERIVATIVE INSTRUMENTS
Generally, options, futures contracts, forward contracts and swap-related
products ("derivative instruments") involve additional investment risks and
transaction costs, and draw upon skills and experience which are different from
those needed to pick the other securities or instruments in which a Portfolio
invests. Special risks of derivatives' use include:
INACCURATE MARKET PREDICTIONS. If interest rates, securities prices or currency
markets do not move in the directions expected by a portfolio manager who uses
derivatives based on those measures, these instruments may fail in their
intended purpose and result in losses to the Portfolio.
IMPERFECT CORRELATION. Derivatives' prices may be imperfectly correlated with
the prices of the securities, interest rates or currencies being hedged. When
this happens, the expected benefits may be diminished.
ILLIQUIDITY. A liquid secondary market may not be available for a particular
instrument at a particular time. A Portfolio may therefore be unable to control
losses by closing out a derivative position.
TAX CONSIDERATIONS. A Portfolio may have to delay closing out certain derivative
positions to avoid adverse tax consequences.
The risk of loss from investing in derivative instruments is potentially
unlimited. See the SAI for more information about derivatives.
FIXED INCOME INVESTING
Risk in the fixed income component of any Portfolio depends on (1) the term of
the securities; (2) the quality of the securities; and (3) changes in interest
rates.
When prevailing interest rates trend downward, the price of existing debt
securities tends to go up, because the coupon payments (or yield) of those
securities becomes more valuable in comparison to prevailing rates. When
interest rates trend upward, the price of existing securities tends to go down.
This effect usually becomes more pronounced with longer-term issues than with
shorter-term issues.
The effect of these fluctuations, in turn, on a Portfolio's share price and
yield depends on the extent to which a Portfolio is invested in debt securities.
HIGH-YIELD/HIGH-RISK BONDS
High-yield/high risk debt securities are also known as "junk bonds." These bonds
involve significant quality and liquidity concerns. Their yields fluctuate. They
are not suitable for short-term investing.
Higher yields are ordinarily available on fixed-income securities which are
unrated or are rated in the lower categories by services such as S&P or Moody's.
Unrated securities are not necessarily of lower quality than rated securities,
but the markets for lower rated and unrated securities are less liquid than
higher rated securities.
Lower rated debt securities (including convertibles) carry significant default
risk -- the risk that the issuer will not make interest or principal payments
when due. Because the coupon rates on these securities are high, the issuers
might experience great financial stress in an economic downturn or during
periods of rising interest rates. This stress might adversely affect their
ability to make interest or principal payments or to obtain additional credit. A
bond default within the Portfolio would cause losses to the Portfolio.
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<PAGE>
The performance of high-yield debt securities in an economic downturn cannot be
precisely predicted.
Appendix A of this Prospectus contains a description of bond rating categories
and includes a weighted average debt rating table for the Flexible Income and
Income Plus Portfolios.
SPECIAL SITUATIONS
Each Portfolio may invest in "special situations" from time to time. Special
situations arise when, in the opinion of a portfolio manager, a company's
securities may be recognized, then increase considerably in price, due to:
o a new product or process;
o a management change;
o a technological breakthrough;
o an extraordinary corporate event; or
o a temporary imbalance in the supply of, and demand for, the securities of
an issuer.
Investing in a special situation carries an additional risk of loss if the
expected development does not happen or does not attract the expected attention.
The impact of special situation investing to a Portfolio will depend on the size
of the Portfolio's investment in a situation.
INVESTMENT ADVISORY AND OTHER SERVICES
The Fund is run by a Board of Trustees. Subject to the supervision of the Board
of Trustees, the assets of each Portfolio are managed by investment advisers and
sub-advisers, and by portfolio managers. This section describes IDEX Series
Fund's ownership, organization and management.
TRUSTEES
The Board of Trustees is responsible for managing the business and affairs of
IDEX Series Fund. It oversees the operation of the Fund by its officers. It also
reviews the management of the Portfolios' assets by the investment advisers and
sub-advisers. Information about the Trustees and officers of the Fund is
contained in the SAI.
CAPITAL APPRECIATION, GLOBAL, GROWTH, BALANCED AND FLEXIBLE INCOME PORTFOLIOS
INVESTMENT ADVISER
These Portfolios have each entered into a Management and Investment Advisory
Agreement ("Advisory Agreement") with Idex Management, Inc. ("IMI"), whose
address is 201 Highland Avenue, Largo, Florida 33770-2597, to act as its
investment adviser. IMI has served as investment adviser to IDEX Series Fund
Capital Appreciation, Global, Growth, Balanced and Flexible Income (and its
predecessor, IDEX Total Income Trust) Portfolios, since the inception of each
Portfolio. IMI also served as the investment adviser to IDEX Fund and IDEX Fund
3, which were reorganized into IDEX Growth Portfolio Class T shares on September
20, 1996, since inception of each of those Funds.
ADVISORY FEES PAID BY THESE PORTFOLIOS
IMI is responsible for furnishing or causing to be furnished to each of these
Portfolios investment advice and recommendations, and for supervising the
purchase and sale of securities as directed by Fund officers. In addition, IMI
is responsible for the administration of each of these Portfolios.
The Portfolios pay IMI an annual fee, computed daily and paid monthly, based on
each Portfolio's average daily net assets, as shown in the Advisory Fee
Schedule.
The investment advisory fees paid by these Portfolios are higher than those paid
by most other funds.
52
<PAGE>
ADVISORY FEE REIMBURSEMENT
IMI will reimburse each of these Portfolios or waive fees, or both, to the
extent that the Portfolio's normal net operating expenses, including advisory
fees but excluding interest, taxes, brokerage commissions and 12b-1 fees, exceed
on an annual basis 1.50% of that Portfolio's average daily net assets.
AGGRESSIVE GROWTH, INTERNATIONAL EQUITY, C.A.S.E., VALUE EQUITY, ^ STRATEGIC
TOTAL RETURN, TACTICAL ASSET ALLOCATION, INCOME PLUS AND TAX-EXEMPT PORTFOLIOS
INVESTMENT ADVISER
These Portfolios have each entered into an Advisory Agreement with
InterSecurities, Inc. ("ISI"), whose address is 201 Highland Avenue, Largo,
Florida 33770-2597, to act as its investment adviser. ISI has served as
investment adviser to the IDEX Series Fund Aggressive Growth, International
Equity, C.A.S.E., Value Equity, ^ Strategic Total Return, Tactical Asset
Allocation, Income Plus and Tax-Exempt Portfolios since the inception of each
Portfolio. ISI is an affiliate of IMI.
ADVISORY FEES PAID BY THESE PORTFOLIOS
ISI is responsible for furnishing or causing to be furnished to each of these
Portfolios investment advice and recommendations, and for supervising the
purchase and sale of securities as directed by Fund officers. In addition, ISI
is responsible for the administration of each of these Portfolios.
The Portfolios pay ISI an annual fee, computed daily and paid monthly, based on
each Portfolio's net assets, as shown in the Advisory Fee Schedule.
The investment advisory fees paid by these Portfolios are higher than those paid
by most other funds.
No investment advisory fees were paid for the fiscal year ended September 30,
1996 or the one-month period ended October 31, 1996 by the Value Equity and
International Equity Portfolios since those Portfolios had not yet begun
operations as of that date.
ADVISORY FEE REIMBURSEMENT
ISI will reimburse a Portfolio or waive fees, or both, to the extent that the
Portfolio's normal net operating expenses, including advisory fees but excluding
interest, taxes, brokerage commissions and 12b-1 fees, exceed on an annual basis
the following percentages of each Portfolio's average daily net assets:
Tax-Exempt Portfolio, 0.65%; Income Plus Portfolio, 1.25%; Aggressive Growth, ^
Strategic Total Return, Tactical Asset Allocation and C.A.S.E. Portfolios,
1.50%; Value Equity Portfolio, 1.15% for the first nine months of the
Portfolio's operations, and 1.50% thereafter; and International Equity
Portfolio, 1.35% for the first nine months of the Portfolio's operations and
1.50% thereafter.
No expenses were paid for the fiscal year ended September 30, 1996 or the
one-month period ended October 31, 1996, by the Value Equity and International
Equity Portfolios, since those Portfolios had not yet begun operations as of
that date.
ACTUAL ADVISORY FEE RATIOS FOR
THE FISCAL YEAR ENDED
SEPTEMBER 30, 1996
PERCENTAGE OF AVERAGE
DAILY NET ASSETS
Capital Appreciation* 0.13%
Global 1.00%
Growth 1.00%
Balanced* 0.00%
Flexible Income* 0.69%
*Net of fees waived by IMI
TOTAL ACTUAL EXPENSE RATIOS FOR THE FISCAL
YEAR ENDED SEPTEMBER 30, 1996,
INCLUDING THE INVESTMENT ADVISORY FEE.
PERCENTAGE OF AVERAGE DAILY NET ASSETS
CLASS A CLASS B CLASS C CLASS T
Capital Appreciation* 1.85% 2.50% 2.40% --
Global 2.09% 2.74% 2.64% --
Growth 1.83% 2.46% 2.34% 1.18%
Balanced ^* 1.85% 2.50% 2.40% --
Flexible Income* 1.85% 2.50% 2.40% --
*Net of fees waived by IMI
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<PAGE>
ADVISORY FEE SCHEDULE
CAPITAL FLEXIBLE
AVERAGE DAILY NET ASSETS APPRECIATION GLOBAL GROWTH BALANCED INCOME
First $750 million 1.00% 1.00% 1.00% 1.00%
the next $250 million 0.90% 0.90% 0.90% 0.90%
over $1 billion 0.85% 0.85% 0.85% 0.85%
First $100 million 0.90%
the next $150 million 0.80%
over $250 million 0.70%
ACTUAL ADVISORY FEE RATIOS FOR
THE FISCAL YEAR ENDED
SEPTEMBER 30, 1996
PERCENTAGE OF AVERAGE DAILY NET
ASSETS
Aggressive Growth* 0.25%
C.A.S.E.* 0.00%
Strategic Total Return* 0.06%
Tactical Asset Allocation* 0.65%
Income Plus 0.60%
Tax-Exempt* 0.13%
*Net of fees waived by ISI
--------------------------------------
TOTAL ACTUAL EXPENSE RATIOS FOR THE FISCAL
YEAR ENDED SEPTEMBER 30, 1996,
INCLUDING THE INVESTMENT ADVISORY FEE.
PERCENTAGE OF AVERAGE DAILY NET ASSETS
CLASS A CLASS B CLASS C
Aggressive Growth* 1.85% 2.50% 2.40%
C.A.S.E. * 2.85% 3.50% 3.40%
Strategic Total Return* 1.85% 2.50% 2.40%
Tactical Asset Allocation* 2.85% 3.50% 3.40%
Income Plus 1.33% 1.98% 1.88%
Tax-Exempt* 1.00% 1.65% 1.25%
*Net of fees waived by ISI
<TABLE>
<CAPTION>
ADVISORY FEE SCHEDULE
STRATEGIC TACTICAL
Aggressive International VALUE TOTAL ASSET INCOME TAX-
AVERAGE DAILY NET ASSETS Growth Equity C.A.S.E. EQUITY RETURN ALLOCATION PLUS EXEMPT
<S> <C> <C> <C> <C> <C> <C> <C> <C>
First $750 million 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 0.60% 0.60%
the next $250 million 0.90% 0.90% 0.90% 0.90% 0.90% 0.90% 0.60% 0.60%
over $1 billion 0.85% 0.85% 0.85% 0.85% 0.85% 0.85% 0.60% 0.60%
</TABLE>
BUSINESS EXPENSES BORNE BY THE PORTFOLIOS
In addition to the investment advisory fee, under their Advisory Agreements, the
Portfolios pay most of their operating costs, including administrative,
bookkeeping and clerical expenses, legal fees, auditing and accounting fees,
shareholder services and transfer agent fees, custodian fees, costs of complying
with federal and state regulations, preparing, printing and distributing reports
to shareholders, non-interested trustees' fees and expenses, interest,
insurance, dues for trade associations and taxes. The Portfolios also pay all
brokerage commissions in connection with portfolio transactions; brokerage of
the Portfolios may be placed with affiliates, and the sale of Fund shares by a
broker-dealer may be taken into account in placing brokerage.
OWNERSHIP OF IDEX MANAGEMENT, INC. AND INTERSECURITIES, INC.
Fifty percent (50%) of the outstanding stock of IMI and 100% of the outstanding
stock of ISI, principal underwriter of the Fund's shares, is owned by AUSA
Holding Company ("AUSA"). AUSA is a holding company which is wholly owned by
AEGON USA, Inc. ("AEGON USA"), a financial services holding company whose
primary emphasis is on life and health insurance and annuity and investment
products. AEGON USA is a wholly owned indirect subsidiary of AEGON nv, a
Netherlands corporation and publicly traded international insurance group. Janus
Capital, the sub-adviser of the Capital Appreciation, Global, Growth, Balanced
and Flexible Income Portfolios, owns the remaining 50% of the outstanding shares
of IMI. Kansas City Southern Industries, Inc., a publicly owned holding company
whose primary subsidiaries are engaged in transportation and financial services,
owns approximately 83% of Janus Capital.
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<PAGE>
SUB-ADVISERS
Janus Capital, AEGON USA Investment Management, Inc. ("AEGON Management"), Fred
Alger Management, Inc. ("Alger Management"), Luther King Capital Management
Corporation ("Luther King"), Dean Investment Associates ("Dean Investment"),
C.A.S.E. Management, Inc. ("C.A.S.E."), NWQ Investment Management Company, Inc.
("NWQ"), Scottish Equitable ^ and GEIM, whose functions in managing the
Portfolios are described below, are described in this Prospectus collectively as
the "sub-advisers" and individually as a "sub-adviser."
AGGRESSIVE GROWTH PORTFOLIO
Alger Management, 75 Maiden Lane, New York, New York 10038, serves as the
investment sub-adviser to the Aggressive Growth Portfolio pursuant to an
Investment Counsel Agreement relating to the Portfolio. Alger Management, a
registered investment adviser, is a wholly owned subsidiary of Fred Alger &
Company, Incorporated ("Alger, Inc."), which in turn is a wholly-owned
subsidiary of Alger Associates, Inc., a financial services holding company
controlled by Fred M. Alger and David D. Alger. As of December 31, 1996, Alger
Management had approximately ^ $7.1 billion in assets under management for
investment companies and private accounts. Alger Management has served as the
investment sub-adviser to the WRL Series Fund, Inc. Aggressive Growth Portfolio
since its inception in February, 1994.
Alger Management provides ISI with investment advice and recommendations for the
Aggressive Growth Portfolio consistent with that Portfolio's investment
objective, policies and restrictions, and supervises all security purchases and
sales on behalf of the Portfolio, including the negotiation of commissions and
the allocation of principal business and portfolio brokerage. In allocating such
portfolio transactions, Alger Management may consider research and other
services furnished to it. It is anticipated that Alger, Inc., an affiliate of
Alger Management, will serve as the Aggressive Growth Portfolio's broker in
effecting substantially all of the Portfolio's transactions on securities
exchanges and will retain commissions in accordance with certain regulations of
the SEC. In placing portfolio business with all broker/dealers, Alger Management
seeks the best execution of each transaction, and all brokerage placement must
be consistent with the Rules of Fair Practice of the NASD.
While Alger Management provides portfolio management services, ISI retains
responsibility for the performance of such functions. For its services, Alger
Management receives 40% of the fees received by ISI under the Aggressive Growth
Portfolio's Advisory Agreement, less 40% of any amount reimbursed to that
Portfolio or waived by ISI pursuant to that Portfolio's expense limitation.
PORTFOLIO MANAGERS:
David D. Alger, Seilai Khoo and Ronald Tartaro are primarily responsible for the
day-to-day management of the Portfolio. Mr. Alger has been employed by Alger
Management as Executive Vice President and Director of Research since 1971 and
as President since 1995 and has served as a portfolio manager of the Aggressive
Growth Portfolio since its inception in December, 1994. Ms. Khoo has been
employed by Alger Management as a senior research analyst since 1989 and as a
Senior Vice President since 1995 and has served as a portfolio manager of the
Aggressive Growth Portfolio since October, 1995. Mr. Tartaro has been employed
by Alger Management as a senior research analyst since 1990 and as a Senior Vice
President since 1995 and has served as a portfolio manager of the Aggressive
Growth Portfolio since October, 1995. Mr. Alger, Ms. Khoo and Mr. Tartaro also
serve as portfolio managers for other mutual funds and investment accounts
managed by Alger Management.
INTERNATIONAL EQUITY PORTFOLIO
Scottish Equitable, Edinburgh Park, Edinburgh EH12 9SE, Scotland, a wholly-owned
subsidiary of Scottish Equitable plc and an indirect wholly-owned subsidiary of
AEGON nv, serves as an investment sub-adviser to the International Equity
Portfolio. Scottish Equitable plc is successor to Scottish Equitable Life
Assurance Society, which was founded in Edinburgh in 1831. As of December 31,
1996, Scottish Equitable plc had ^ over $20 billion in assets under management.
Scottish Equitable currently provides investment advisory and management
services to certain of its affiliates, including Scottish Equitable plc, and to
other external organizations.
GEIM, 3003 Summer Street, Stamford, Connecticut 06905, a wholly-owned subsidiary
of General Electric Company, also serves as an investment sub-adviser to the
International Equity Portfolio. GEIM's principal officers and directors serve in
similar capacities with respect to GEIC, also a wholly-owned subsidiary of
General Electric Company. GEIC serves as investment adviser to various GE
pension and benefit plans and certain employee mutual funds. GEIC and GEIM (and
their predecessors) together have approximately 70 years of investment
management experience, and have managed mutual funds since 1935. Together, as of
December 31 1996, GEIM and GEIC managed assets in excess of ^ $57 billion.
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<PAGE>
GEIM and Scottish Equitable also serve as the investment sub-advisers to the WRL
Series Fund, Inc. International Equity Portfolio; and GEIM serves as the
investment sub-adviser to the WRL Series Fund, Inc. U.S. Equity Portfolio.
Scottish Equitable and GEIM provide ISI with investment advice and
recommendations for the International Equity Portfolio consistent with that
Portfolio's investment objective, policies and restrictions, and supervise all
security purchases and sales transactions on behalf of the Portfolio, including
the negotiation of commissions and the allocation of principal business and
portfolio brokerage. In allocating such portfolio transactions, Scottish
Equitable and GEIM may consider research and other services furnished to them
and may place portfolio transactions with broker-dealers that are affiliated
with ISI, Scottish Equitable or GEIM. It is anticipated that PaineWebber, an
affiliate of GEIM, may serve as a broker to the Portfolio's transactions and
retain commissions in accordance with certain regulations of the SEC. In placing
portfolio business with all broker/dealers, Scottish Equitable and GEIM seek the
best execution of each transaction, and all brokerage placement must be
consistent with the Rules of Fair Practice of the NASD.
While Scottish Equitable and GEIM provide portfolio management services, ISI
retains responsibility for the performance of such functions. For their
services, Scottish Equitable and GEIM each will receive 45% of the fees received
by ISI with respect to the amount of Portfolio assets managed by each
sub-adviser under the International Equity Portfolio's Advisory Agreement, and,
until at least January 31, 1998, less 45% of any amount reimbursed to the
Portfolio or waived by ISI pursuant to that Portfolio's expense limitation, with
respect to the amount of assets managed by each sub-adviser.
PORTFOLIO MANAGERS:
James Aird serves as the Scottish Equitable Investment Manager for the
International Equity Portfolio. Mr. Aird joined Scottish Equitable in 1981 and
has served both as a portfolio manager and investment analyst. Mr. Aird has the
responsibility for Scottish Equitable's investment services in the U.S. and
Europe. Mr. Aird joined Scottish Equitable directly from the University of
Edinburgh where he earned a BSc in Economics. He is also an associate of the
Institute of Investment Management and Research.
Ralph R. Layman serves as the GEIM Portfolio Manager for the International
Equity Portfolio. Mr. Layman has more than 17 years of investment experience and
has held positions with GEIM since 1991. From 1989 to 1991, Mr. Layman served as
Executive Vice President, Partner and Portfolio Manager of Northern Capital
Management, and prior thereto, served as Vice President and Portfolio Manager of
Templeton Investment Counsel. Mr. Layman is currently an Executive Vice
President of GEIM.
CAPITAL APPRECIATION, GLOBAL, GROWTH, BALANCED AND FLEXIBLE INCOME PORTFOLIOS
IMI has entered into an Investment Counsel Agreement for each of these
Portfolios with Janus Capital, 100 Fillmore Street, Denver, Colorado 80206.
Janus Capital is a registered investment adviser which serves as the investment
adviser or sub-adviser to other mutual funds and private accounts. Janus Capital
is also sub-adviser to certain Portfolios of the WRL Series Fund, Inc., an
affiliate of the Fund. Janus Capital also served as sub-adviser to IDEX Fund and
IDEX Fund 3 prior to their reorganization into the Growth Portfolio Class T
shares, since the inception of each of those Funds.
Janus Capital provides IMI with investment advice and recommendations for each
Portfolio consistent with that Portfolio's investment objective, policies and
restrictions, and supervises all security purchases and sales on behalf of the
Portfolio, including the negotiation of commissions and the allocation of
principal business and portfolio brokerage. In allocating such portfolio
transactions, Janus Capital may consider research and other services furnished
to it and may place portfolio transactions with broker-dealers that are
affiliated with IMI or Janus Capital. In placing portfolio business with all
broker/dealers, Janus Capital seeks the best execution of each transaction, and
all brokerage placement must be consistent with the Rules of Fair Practice of
the NASD.
While Janus Capital provides portfolio management services, IMI retains
responsibility for the performance of such functions. For its services, Janus
Capital receives 50% of the fees received by IMI under each of the Growth,
Global, Flexible Income, Balanced and Capital Appreciation Portfolios'
respective Advisory Agreements, less 50% of any amount reimbursed to the
Portfolio or waived by IMI pursuant to that Portfolio's expense limitation. IMI
may pay additional compensation to Janus Capital under certain circumstances
depending on the level of the aggregate net assets of IDEX Series Fund, as
described in the SAI.
PORTFOLIO MANAGERS:
Scott W. Schoelzel has served as portfolio manager of the Growth Portfolio since
January, 1996. He previously served as co-portfolio manager of the Growth
Portfolio from 1995 until becoming portfolio manager. Mr. Schoelzel also served
as portfolio manager of IDEX Fund and IDEX Fund 3 prior to their reorganization
into the Growth Portfolio Class T shares. Mr. Schoelzel is Vice President of
Janus Capital, where he has been employed since 1994. From 1991 to 1993, Mr.
Schoelzel was a portfolio manager with Founders Asset Management, Denver,
Colorado.
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<PAGE>
Helen Y. Hayes has served as portfolio manager of the Global Portfolio since its
inception. Ms. Hayes is also an Executive Vice President of Janus Investment
Fund and Janus Aspen Series. Ms. Hayes has been employed by Janus Capital since
1987.
Ronald V. Speaker has served as portfolio manager of the Flexible Income
Portfolio since October, 1993, and served as portfolio manager of the Flexible
Income Portfolio's predecessor, IDEX Total Income Trust, since February, 1992.
Mr. Speaker is also an Executive Vice President of Janus Investment Fund and
Janus Aspen Series; he joined Janus Capital as a securities analyst and research
associate in 1986. On January 13, 1997, Mr. Speaker, settled an SEC
administrative action involving two personal trades that he made in January of
1993. Without admitting or denying the allegations, Mr. Speaker agreed to civil
money penalty, disgorgement and interest payments totaling $37,199, and to a
90-day suspension starting on or about January 27, 1997. During that time, the
Flexible Income Portfolio will be managed by its co-manager, Sandy Rufenacht.
Sandy R. Rufenacht has been co-portfolio manager of the Flexible Income
Portfolio since January, 1997. Mr. Rufenacht joined Janus Capital Corporation in
1990 and gained experience as a trader and research analyst before assuming
management responsibilities. He holds a Bachelor of Arts in Business from the
University of Northern Colorado. Mr. Rufenacht is also an Executive Vice
President of Janus Investment Fund and serves as portfolio manager or co-manager
of other mutual funds.
Blaine P. Rollins has assisted in the management of the Balanced Portfolio since
its inception, and has served as portfolio manager since February 1, 1996. Mr.
Rollins joined Janus Capital in 1990 and has gained experience as a trader and
research analyst prior to assuming management responsibility for the Balanced
Portfolio. He holds a Bachelor of Science in Finance from the University of
Colorado and is a Chartered Financial Analyst. He has also managed the Janus
Balanced Fund since January 1996.
James P. Goff has served as portfolio manager of the Capital Appreciation
Portfolio since its inception. Mr. Goff joined Janus Capital in 1988 and has
managed Janus Enterprise Fund since its inception in September, 1992. He has
co-managed Janus Venture Fund since December, 1993.
VALUE EQUITY PORTFOLIO
NWQ, 655 South Hope Street, 11th Floor, Los Angeles, CA 90017, serves as the
investment sub-adviser to the Value Equity Portfolio. NWQ was founded in 1982
and is a wholly-owned subsidiary of United Asset Management Corporation. NWQ
provides investment management services to institutions and high net worth
individuals. As of September 30, 1996, NWQ had over $6.2 billion in assets under
management. NWQ has served as the investment sub-adviser to the WRL Series Fund,
Inc. Value Equity Portfolio since its inception.
NWQ provides ISI with investment advice and recommendations for the Value Equity
Portfolio consistent with that Portfolio's investment objective, policies and
restrictions, and supervises all security purchases and sales on behalf of the
Portfolio, including the negotiation of commissions and the allocation of
principal business and portfolio brokerage. In allocating such portfolio
transactions, NWQ may consider research and other services furnished to it. In
placing portfolio business with all broker/dealers, NWQ seeks the best execution
of each transaction, and all brokerage placement must be consistent with the
Rules of Fair Practice of the NASD.
While NWQ provides portfolio management services, ISI retains responsibility for
the performance of such functions. For its services, NWQ receives 40% of the
fees received by ISI under the Value Equity Portfolio's Advisory Agreement, less
40% of any amount reimbursed to that Portfolio or waived by ISI pursuant to that
Portfolio's expense limitation.
PORTFOLIO MANAGERS:
An investment policy committee is responsible for the day-to-day management of
the Value Equity Portfolio's investments. David A. Polak, CFA, Edward C.
Friedel, CFA, James H. Galbreath, CFA, Phyllis G. Thomas, CFA and Jon D. Bosse,
CFA, constitute the committee.
Edward C. Friedel serves as Senior Portfolio Manager for the Value Equity
Portfolio. Mr. Friedel has been a managing director and investment
strategist/portfolio manager of NWQ since 1983. From 1971 to 1983, Mr. Friedel
was a portfolio manager for Beneficial Standard Investment Management.
C.A.S.E. PORTFOLIO
C.A.S.E., located at 2255 Glades Road, Suite 221-A, Boca Raton, FL 33431, serves
as the investment sub-adviser to the C.A.S.E. Portfolio pursuant to an
Investment Counsel Agreement relating to the Portfolio. C.A.S.E. is a registered
investment advisory firm and a wholly- owned subsidiary of C.A.S.E., Inc.
C.A.S.E., Inc. is indirectly controlled by William Edward Lange, President and
Chief Executive Officer
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of the sub-adviser. C.A.S.E. provides investment management services to
financial institutions, high net worth individuals and other professional money
managers. C.A.S.E. has served as the investment sub-adviser to the WRL Series
Fund, Inc. C.A.S.E. Quality Growth, C.A.S.E. Growth & Income and C.A.S.E. Growth
Portfolios since their inception in 1995.
C.A.S.E. provides ISI with investment advice and recommendations for the
C.A.S.E. Portfolio consistent with that Portfolio's investment objective,
policies and restrictions, and supervises all security purchases and sales
transactions on behalf of the Portfolio, including the negotiation of
commissions and the allocation of principal business and portfolio brokerage. In
allocating such portfolio transactions, C.A.S.E. may consider research and other
services furnished to it and may place portfolio transactions with
broker-dealers that are affiliated with ISI or C.A.S.E. In placing portfolio
business with all broker/dealers, C.A.S.E. seeks the best execution of each
transaction, and all brokerage placement must be consistent with the Rules of
Fair Practice of the NASD.
While C.A.S.E. provides portfolio management services, ISI retains
responsibility for the performance of such functions. For its services, C.A.S.E.
receives 40% of the fees received by ISI under the C.A.S.E. Portfolio's Advisory
Agreement, less 40% of any amount reimbursed to the Portfolio or waived by ISI
pursuant to that Portfolio's expense limitation.
PORTFOLIO MANAGERS:
The C.A.S.E. Portfolio is managed by a team of investors called the
Portfolio Management Committee. William Edward Lange serves as the head
portfolio manager to the Portfolio Management Committee. Mr. Lange has been
President of C.A.S.E. since 1984.
^ STRATEGIC TOTAL RETURN PORTFOLIO
Luther King, 301 Commerce Street, Suite 1600, Fort Worth, Texas 76102, serves as
the investment sub-adviser to the ^ Strategic Total Return Portfolio pursuant to
an Investment Counsel Agreement relating to the Portfolio. Ultimate control of
the sub-adviser is exercised by Luther King, Jr. Luther King is a registered
investment adviser and provides investment management services to accounts of
individual and other institutional investors. Luther King has served as the
investment sub-adviser to the WRL Series Fund, Inc. ^ Strategic Total Return
Portfolio since its inception in February, 1993.
Luther King provides ISI with investment advice and recommendations for the ^
Strategic Total Return Portfolio consistent with that Portfolio's investment
objective, policies and restrictions, and supervises all security purchases and
sales transactions on behalf of the Portfolio, including the negotiation of
commissions and the allocation of principal business and portfolio brokerage. In
allocating such portfolio transactions, Luther King may consider research and
other services furnished to it and may place portfolio transactions with
broker-dealers that are affiliated with ISI or Luther King. In placing portfolio
business with all broker/dealers, Luther King seeks the best execution of each
transaction, and all brokerage placement must be consistent with the Rules of
Fair Practice of the NASD.
While Luther King provides portfolio management services, ISI retains
responsibility for the performance of such functions. For its services, Luther
King receives 40% of the fees received by ISI under the ^ Strategic Total Return
Portfolio's Advisory Agreement, less 40% of any amount reimbursed to that
Portfolio or waived by ISI pursuant to that Portfolio's expense limitation.
PORTFOLIO MANAGERS:
Luther King, Jr. and Scot C. Hollmann have served as portfolio managers of the ^
Strategic Total Return Portfolio since its inception. Mr. King has been
President of Luther King since 1979. Mr. Hollmann has served as Vice President
of Luther King since 1983.
TACTICAL ASSET ALLOCATION PORTFOLIO
ISI has entered into an Investment Counsel Agreement for the Tactical Asset
Allocation Portfolio with Dean Investment, a division of C.H. Dean and
Associates, Inc., 2480 Kettering Tower, Dayton, Ohio 45423-2480. Founded in
1972, Dean Investment manages portfolios for individuals and institutional
clients world-wide and provides a full range of investment advisory services,
with more than ^ $3.7 billion in assets under management as of December 31,
1996. Dean Investment has served as the investment sub-adviser to the WRL Series
Fund, Inc. Tactical Asset Allocation Portfolio since its inception in January,
1995.
Dean Investment provides ISI with investment advice and recommendations for the
Tactical Asset Allocation Portfolio consistent with that Portfolio's investment
objective, policies and restrictions, and supervises all security purchases and
sales on behalf of the Portfolio, including the negotiation of commissions and
the allocation of principal business and portfolio brokerage. In allocating such
portfolio transactions, Dean Investment may consider research and other services
furnished to it and may place portfolio transactions with broker-dealers that
are affiliated with ISI or Dean Investment. In placing portfolio business with
all broker/dealers, Dean Investment seeks the best execution of each
transaction, and all brokerage placement must be consistent with the Rules of
Fair Practice of the NASD.
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While Dean Investment provides portfolio management services, ISI retains
responsibility for the performance of such functions. For its services, Dean
Investment receives 40% of the fees received by ISI under the Tactical Asset
Allocation Portfolio's Advisory Agreement, less 40% of any amount reimbursed to
that Portfolio or waived by ISI pursuant to that Portfolio's expense limitation.
PORTFOLIO MANAGERS:
John C. Riazzi, CFA, is the Senior Portfolio Manager of the Tactical Asset
Allocation Portfolio. Mr. Riazzi joined Dean Investment in March of 1989. Before
being promoted to Vice President and Director of Consulting Services, Mr. Riazzi
was responsible for client servicing, portfolio execution and trading
operations. Mr. Riazzi has been a member of the Central Investment Committee of
Dean Investment and a Senior Institutional Portfolio Manager for the past five
years.
Arvind Sachdeva, CFA, is the Senior Equity Strategist of the Tactical Asset
Allocation Portfolio. Mr. Sachdeva joined Dean Investment in 1993. Before that,
he had been the Senior Security Analyst and Equity Portfolio Manager for
Carillon Advisers, Inc. from 1985 to 1993. Carillon Advisers, Inc. is an
investment subsidiary of the Union Central Life Insurance Company.
INCOME PLUS AND TAX-EXEMPT PORTFOLIOS
AEGON Management, 4333 Edgewood Road N.E., Cedar Rapids, Iowa 52499, serves as
the investment sub-adviser to each of these Portfolios pursuant to an Investment
Counsel Agreement relating to each Portfolio. Each Investment Counsel Agreement
was entered into between ISI and AEGON USA Securities, Inc. ("AEGON
Securities"), formerly known as MidAmerica Management Corporation, which
assigned each Agreement to AEGON Management on September 30, 1992. AEGON
Securities previously served as the investment adviser to each series of AEGON
USA Managed Portfolios, Inc. AEGON Management also serves as sub-adviser to
certain portfolios of the WRL Series Fund, Inc. AEGON Management is a wholly
owned indirect subsidiary of AEGON USA and thus is an affiliate of ISI and IMI.
AEGON Management provides ISI with investment advice and recommendations for
each Portfolio consistent with that Portfolio's investment objective, policies
and restrictions, and supervises all security purchases and sales on behalf of
the Portfolio, including the negotiation of commissions and the allocation of
principal business and portfolio brokerage. In allocating such portfolio
transactions, AEGON Management may consider research and other services
furnished to it and may place portfolio transactions with broker-dealers that
are affiliated with ISI or AEGON Management. In placing portfolio business with
all broker/dealers, AEGON Management seeks the best execution of each
transaction, and all brokerage placement must be consistent with the Rules of
Fair Practice of the NASD.
While AEGON Management provides portfolio management services, ISI retains
responsibility for the performance of such functions. For its services, AEGON
Management receives 50% of the fees received by ISI under the Tax-Exempt and
Income Plus Portfolios' Advisory Agreements, less 50% of any amount reimbursed
to that Portfolio or waived by ISI pursuant to that Portfolio's expense
limitation.
PORTFOLIO MANAGERS:
Rachel A. Dennis has served as portfolio manager of the Tax-Exempt Portfolio
since its inception. Ms. Dennis is a Vice President of AEGON Management. Ms.
Dennis has been employed by AEGON Management and its affiliates in various
positions since 1977.
David R. Halfpap has served as portfolio manager of the Income Plus Portfolio
since its inception. Mr. Halfpap is also a Senior Vice President of AEGON
Management and has been employed by AEGON Management and its affiliates in
various positions since 1975.
ADMINISTRATOR
IMI has entered into separate Administrative Services Agreements
("Administrative Agreements") pursuant to which ISI serves as administrator to
the Growth, Global, Flexible Income, Balanced and Capital Appreciation
Portfolios.
Under these Administrative Agreements, ISI provides all services required to
carry on the general administrative and corporate affairs of these Portfolios.
These services include furnishing all executive and managerial personnel, office
space and equipment, arrangements for and supervision of all shareholder
services, federal and state regulatory compliance, and responsibility for
accounting and record keeping.
For its services under an Administrative Agreement, ISI receives 50% of the fees
received by IMI under the corresponding Advisory Agreement. Under certain
circumstances, the amounts payable to ISI under an Administrative Agreement will
be reduced by any additional compensation payable by IMI to Janus Capital, as
described in the SAI.
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DISTRIBUTOR AND DISTRIBUTION AND SERVICE PLANS
UNDERWRITING AGREEMENTS
The Fund has entered into an Underwriting Agreement with ISI pursuant to which
ISI serves as principal underwriter and performs services and bears expenses
relating to the offering of Fund shares for sale to the public.
ISI is compensated by each Portfolio for services as distributor and principal
underwriter for Class A, Class B and Class C shares of each Portfolio, and Class
T shares of the Growth Portfolio.
DISTRIBUTION PLANS
ISI may use the fees payable under these plans as it deems appropriate to pay
for activities or expenses primarily intended to result in the sale of the
respective share classes or in personal service to and/or maintenance of
shareholder accounts of the respective share classes. Expense categories may
include, but are not limited to: compensation to employees of ISI; compensation
to and expenses of ISI, dealers or other financial institutions who sell shares
or service shareholder accounts; the costs of printing and distributing
prospectuses, statements of additional information and reports for other than
existing shareholders; and the costs of preparing, printing and distributing
sales literature and advertising materials. Payments made under the plans may
exceed distribution expenses actually incurred.
Of the distribution and service fees received by ISI for Class A and Class B
shares, ISI currently reallows an annual amount of 0.25% of the average daily
net assets of that Portfolio's Class A or Class B shares to brokers or dealers
that have sold such shares. Of the distribution and service fees received by ISI
for Class C shares, ISI currently reallows the total fees to brokers or dealers
that have sold such Class C shares. Class T shares of the Growth Portfolio are
not subject to annual distribution and service fees. However, as compensation
for the expenses borne by ISI and the distribution services provided, ISI
receives the sales charges imposed on Class T shares and reallows a portion of
such charges to brokers or dealers that have sold such Class T shares.
CLASS A SHARE DISTRIBUTION PLAN
As compensation for the expenses borne by ISI and the distribution services
provided, ISI receives the sales charges imposed on Class A shares and reallows
a portion of such charges to brokers or dealers that have sold Class A shares.
ISI may also receive annual distribution and service fees in accordance with the
Plan of Distribution pursuant to Rule 12b-1 under the 1940 Act, adopted with
respect to each class of shares of a Portfolio. Under its Plan of Distribution
for Class A shares ("Class A Plan"), a Portfolio may pay ISI an annual
distribution fee of up to 0.35%, and an annual service fee of up to 0.25%, of
the average daily net assets of that Portfolio's Class A shares. However, to the
extent that a Portfolio pays service fees, the amount the Portfolio may pay as a
distribution fee is reduced accordingly, so that the total fees payable under
the Class A Plan may not exceed 0.35%, on an annualized basis, of the average
daily net assets of that Portfolio's Class A shares.
CLASS B SHARE DISTRIBUTION PLAN
Under its Plan of Distribution for Class B shares ("Class B Plan"), a Portfolio
may pay ISI an annual distribution fee of up to 0.75%, and an annual service fee
of up to 0.25%, of the average daily net assets of that Portfolio's Class B
shares.
CLASS C SHARE DISTRIBUTION PLAN
Under its Plan of Distribution for Class C shares ("Class C Plan"), a Portfolio
may pay ISI an annual distribution fee of up to 0.75%, and an annual service fee
of up to 0.25%, of the average daily net assets of that Portfolio's Class C
shares. However, the total fee payable pursuant to a Class C Plan may not, on an
annualized basis, exceed 0.90% of the average daily net assets of each
Portfolio, and the Tax-Exempt Portfolio currently intends to limit the total
fees payable pursuant to its Class C Plan to 0.60% of the average daily net
assets of that Portfolio's Class C shares.
MISCELLANEOUS INFORMATION
ORGANIZATION OF THE PORTFOLIOS
Each Portfolio is a series of IDEX Series Fund ("the Fund"), a Massachusetts
business trust that was formed by a Declaration of Trust dated January 7, 1986
and whose operations are governed by a Restatement of Declaration of Trust dated
as of August 30, 1991 ("Declaration of Trust"). A copy of the Declaration of
Trust is on file with the Secretary of the Commonwealth of Massachusetts. On
September 20,
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1996, in a tax free reorganization, IDEX Growth Portfolio acquired all of the
assets and assumed all of the liabilities of each of IDEX Fund and IDEX Fund 3
in exchange for Class T shares of IDEX Growth Portfolio, which were then
distributed on a pro rata basis to the respective shareholders of IDEX Fund and
IDEX Fund 3. At that time, the Fund changed its name from IDEX II Series Fund to
IDEX Series Fund. Before its organization as a series company, the Fund was
called IDEX II.
Under Massachusetts law, shareholders of a Massachusetts business trust could,
under certain circumstances, be held personally liable for acts or obligations
of the Fund. The Declaration of Trust contains an express disclaimer of
shareholder liability for acts, obligations or affairs of the Fund. The
Declaration of Trust also provides for indemnification out of Fund assets for
all loss and expense of any shareholder held personally liable by reason of
being or having been a shareholder. Liability is limited to circumstances in
which the Fund itself would be unable to meet its obligations, a possibility
that IDEX believes is remote.
CLASS A, CLASS B, CLASS C AND CLASS T SHARES
The Fund is managed by its Board of Trustees pursuant to the Declaration of
Trust. The Declaration of Trust permits the Board of Trustees to issue an
unlimited number of shares of beneficial interest in the Fund. The shares of
beneficial interest of each Portfolio are currently divided into three classes:
Class A, Class B, and Class C shares. In addition, the shares of beneficial
interest of IDEX Growth Portfolio only include a fourth class of shares,
designated Class T shares. Each class represents interests in the same assets of
the Portfolio. The classes differ as follows:
o Each class of shares has exclusive voting rights on matters pertaining to
its plan of distribution or any other matters appropriately limited to that
class.
o Class A shares are subject to an initial sales charge, or front-end load.
Class A shares which are not subject to an initial sales charge because of
the size of the purchase are subject to a deferred sales charge if redeemed
during the first year.
o Class B shares are subject to a contingent deferred sales charge, or
back-end load, at a declining rate.
o Class C shares are subject to higher ongoing distribution and service fees
than Class A shares, and lower ongoing distribution and service fees than
Class B shares.
o Class T shares of the Growth Portfolio are subject to an initial front-end
load, but no annual distribution and service fees. Class T shares are not
available to new investors; only existing Class T shareholders (who were
shareholders of IDEX Fund or IDEX Fund 3 on September 20, 1996) may
purchase additional Class T shares.
Each class may bear differing amounts of certain class-specific expenses. Each
class has a separate exchange privilege. Each share of a series is entitled to
equal voting, dividend, liquidation, and redemption rights, except that due to
the differing expenses borne by the three classes, dividends and liquidation
proceeds of Class B and Class C shares are expected to be lower than for Class A
shares of the same Portfolio, and with respect to the Growth Portfolio, lower
than for Class T shares.
Class B shares convert automatically into Class A shares of the same Portfolio
eight years after the end of the calendar month in which the shareholder's order
to purchase the share was accepted. The conversion is based on net asset value,
without any sales charge, fee or other charge. The purpose of this conversion is
to relieve the holders of the Class B shares from the higher ^ distribution and
service fees imposed on those shares, after ISI has been substantially
compensated for distribution expenses by those fees.
The Fund does not expect that there will be any conflicts between the interests
of holders of the different classes of shares of the same Portfolio because of
the class structure. The Board of Trustees will consider, if necessary, whether
any such conflict exists; if it does, the Board will take appropriate action to
resolve it.
PERSONAL SECURITIES TRADING
The Fund permits "Access Persons" as defined by Rule 17j-1 under the 1940 Act to
engage in personal securities transactions, subject to the terms of the Code of
Ethics and Insider Trading Policy ("the Policy") that has been adopted by the
Board of Trustees of the Fund. Access Persons must use the guidelines
established by this Policy for all personal securities transactions and are
subject to certain prohibitions on personal trading. The Fund's sub-advisers,
pursuant to Rule 17j-1 and other applicable laws, and pursuant to the terms of
the Policy, must adopt and enforce their own Code of Ethics and Insider Trading
Policies appropriate to their particular business needs. Each sub-adviser must
report to the Board of Trustees on a quarterly basis with respect to the
administration and enforcement of such Policy, including any violations thereof
which may potentially affect the Fund.
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SHAREHOLDER MEETINGS
The Fund does not intend to hold annual meetings of shareholders, unless
required to do so by the 1940 Act or by the Declaration of Trust. A meeting will
be called for the election of trustees upon the written request of holders of
10% of the outstanding shares of the Fund.
Shareholders have neither preemptive nor cumulative voting rights.
THE TRANSFER AGENT
Idex Investor Services, Inc., P.O. Box 9015, Clearwater, Florida 34618-9015, an
affiliate of IMI and ISI, is the Fund's transfer agent, withholding agent and
dividend paying agent.
THE CUSTODIAN
Investors Fiduciary Trust Company ("IFTC"), 127 West 10th Street, Kansas City,
Missouri 64105, is custodian of the Fund's assets and serves as custodian for
qualified retirement plans and individual retirement plan accounts investing in
the Fund. However, all correspondence about a shareholder's account should be
sent to IDEX.
SHAREHOLDER INQUIRIES
Inquiries by shareholders about a Portfolio or requests for forms for opening or
changing accounts or plans should be made by writing IDEX at P.O. Box 9015,
Clearwater, Florida 34618-9015 or calling IDEX Customer Service at (800)
851-9777.
SHAREHOLDER REPORTS, PROSPECTUSES AND
CONSOLIDATED STATEMENTS
The Fund sends annual and semi-annual reports and updated prospectuses to
shareholders. The annual reports contain audited financial statements. To reduce
costs, the Fund will send only one copy of certain mailings to a shareholder who
has more than one account (each with the same taxpayer ID number). Further, two
or more shareholders may elect to receive a consolidated statement and only one
copy of certain mailings for their accounts so long as they share the same
surname and address. Select this option on the New Account Application or by
written request to IDEX Customer Service.
Additional copies of shareholder reports and prospectuses may be obtained by
calling IDEX Customer Service.
DISTRIBUTIONS AND TAXES
This section discusses how and when the Portfolios make distributions to you ^
and some of your tax responsibilities related to such distributions.
INCOME AND CAPITAL GAINS DISTRIBUTIONS
The Portfolios pay several kinds of distributions. Ordinary income distributions
are made from fund earnings from interest paid on taxable bonds, dividends paid
on stocks, and other kinds of securities income. Capital gains distributions are
made from gains realized when securities owned by a Portfolio for more than one
year are sold at an amount greater than their cost. Short-term capital gain
distributions (related to securities sold which have been owned one year or
less) are ordinary income, not capital gain, to shareholders. The Tax-Exempt
Portfolio pays exempt interest dividends that are generally exempt from Federal
income tax.
NOTE: A Portfolio may also realize capital losses.
Ordinarily, the Portfolios distribute income and capital gains annually, except
that the ^ Strategic Total Return, Tactical Asset Allocation and Balanced
Portfolios distribute income quarterly, and the Flexible Income, Income Plus and
Tax-Exempt Portfolios distribute income monthly. Dividend transactions are
confirmed quarterly. Capital gain distributions realized during each fiscal year
normally will be declared and paid in the following fiscal year. To avoid a 4%
excise tax on undistributed amounts of ordinary income and capital gains, as
described in the SAI, a Portfolio may, to the extent permitted by the SEC, pay
additional distributions of capital gain in any year and make additional
dividend distributions.
Dividends and other distributions paid by a Portfolio with respect to its Class
A, Class B, Class C and Class T shares are calculated in the same manner and
declared and paid at the same time. For a complete discussion of Class A, Class
B, Class C and Class T share values and expenses, see Shareholder Information
and Instructions.
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If you buy shares in a non-retirement account on or shortly before the record
date for a dividend or other taxable distribution, you will pay full price for
the shares, then receive some portion of what you paid as a taxable
distribution.
HOW YOU RECEIVE YOUR DISTRIBUTIONS
The Portfolios will automatically reinvest your dividend and capital gain
distributions in additional portfolio shares of the same class you already own,
unless you specify another payment method. See Shareholder Information and
Instructions for complete information about how to receive your distributions.
Requested cash distributions will be paid by direct deposit (via Automated
Clearing House electronic funds transfer ("ACH")), or by check, whichever you
choose on your New Account Application. Dividend checks are usually mailed,
along with a confirmation, on the payable date. The dividend checks will be made
payable to the shareholder of record and mailed to the address of record. You
may request a different payee or address on the New Account Application. To
change your current dividend procedures on an existing account, send a signature
guaranteed request to IDEX.
Any checks which cannot be delivered and are returned to IDEX will be reinvested
in full or fractional shares in your account at the net asset value next
computed after the check has been received by IDEX. To reduce costs to a
Portfolio, checks outstanding and uncashed for over 180 days may have payments
stopped and be reinvested back into the shareholder/payee's account at the
discretion of IDEX. Cash distributions that total less than $5.00 will be
reinvested into the account.
Shareholders may obtain further information or change their dividend or
distribution options any time before the record date of any dividend or
distribution by calling IDEX Customer Service at (800) 851-9777 or writing to
IDEX, P.O. Box 9015, Clearwater, FL 34618- 9015.
TAX INFORMATION
Each Portfolio is treated as a separate entity for federal tax purposes. Each
Portfolio is a regulated investment company, as defined by Subchapter M of the
Internal Revenue Code of 1986 (the "Code"), as amended.
For each fiscal period, if a Portfolio meets certain requirements of the Code,
the Portfolio does not pay taxes on net income realized from investment
operations to the extent earnings and profits are distributed to shareholders.
Shareholders are responsible for any taxes ^ attributable to distributions. (See
The Tax-Exempt Portfolio -- Special Considerations, below, for discussion of
tax-exempt distributions; see the SAI for a complete discussion of the tax
treatment of a mutual fund as a regulated investment company.)
If a Portfolio declares a dividend or other distribution in October, November or
December payable to shareholders of record on a specified date in such a month,
and if the Portfolio pays the distribution to the shareholders during January of
the following year, then each shareholder will be treated as receiving the
distribution on December 31 of the first year, and the Portfolio will be treated
as having paid the distribution on that date.
"TAXABLE EVENTS" -- WHEN AND HOW YOU OWE FEDERAL INCOME TAX
RELATED TO YOUR PORTFOLIO INVESTMENT
SELLING OR EXCHANGING SHARES. When you sell shares, whether you take cash or
exchange the shares for shares in another Portfolio, it is a "taxable event."
For non-retirement plan accounts, you will owe tax if you realize a taxable gain
on the sale or exchange. On the other hand, if you realize a loss based on your
cost or basis in the shares, you may be able to offset that capital loss against
any capital gain income you have. If there were any capital gains distributions
on the shares, the loss that is allowed will be treated as a long-term capital
loss, to the extent of the capital gains distributions.
For tax purposes, the cost of a Class A or Class T share is generally the
per-share price you paid for your shares (which may include sales charges); the
cost of a Class B or Class C share is the per-share NAV. The reorganization of
IDEX Fund and IDEX Fund 3 into the IDEX Growth Portfolio on September 20, 1996,
was not a taxable event. As such, the former shareholders of IDEX Fund and IDEX
Fund 3 who received Class T shares of IDEX Growth Portfolio as a result of the
reorganization obtained a carryover basis and carryover holding period in their
Class T shares. ^ As a general rule, your gain or loss on a sale or exchange
will be a long-term capital gain or loss if the shares have been held for more
than one year and a short-term capital gain or loss if held for one year or
less. Under current tax law, individuals are subject to a maximum federal tax
rate of 28% on net capital gain.
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For most accounts (other than retirement plan accounts which will receive Form
1099-R), IDEX will provide you with your "cost basis" when you sell shares. This
cost basis figure is important. It is figured on the single category average
cost method, and it may assist you in determining the gain or loss on your share
sales.
You are not required to use this method; in fact, if you have previously sold
shares in a Portfolio and did not use this method to report gain or loss, it is
not available to you for sales of shares in that Portfolio. To determine which
cost basis method is most suitable for you, please consult your tax adviser.
NOTE: Please keep all regular account statements to use in conjunction with
average cost information (if received) in order to determine gain or loss on the
sale of Portfolio shares.
INCOME TAX OWED ON INCOME DISTRIBUTIONS. Ordinary income distributions from all
Portfolios, whether received in cash or reinvested, are subject to ordinary
income tax rates. See the Tax-Exempt Portfolio - Special Considerations, below.
INCOME TAX OWED ON CAPITAL GAIN DISTRIBUTIONS. As explained above, the
Portfolios generally distribute net realized capital gains, to the extent
available, to shareholders once a year. These capital gains distributions,
whether paid in cash or reinvested, are subject to the maximum Federal capital
gains tax rate of 28% -- the same tax rate as if you sell shares and realize a
gain. If you sell shares in a Portfolio, then buy shares again under the
reinvestment privilege described in Shareholder Information and Instructions,
the cost of shares sold may need to be reduced related to any front-end sales
charges you may have initially paid. See the SAI and consult your tax adviser
about these rules, as well as wash sale provisions of the Internal Revenue Code.
THE TAX-EXEMPT PORTFOLIO --
SPECIAL CONSIDERATIONS
The Tax-Exempt Portfolio intends to continue to qualify to pay "exempt-interest"
dividends. These are distributions from the Portfolio's investment income
attributable to interest on municipal obligations. Exempt-interest dividends are
generally excluded from the calculation of the gross income of recipients for
federal income tax purposes.
The Tax-Exempt Portfolio's principal business is tax-exempt investing. However,
some of its investments or activities may result in taxable income to its
shareholders, or other tax consequences. Possible tax effects include:
ALTERNATIVE MINIMUM TAX. Some securities held by the Tax-Exempt Portfolio may
pay interest which is a tax preference item for purposes of computing the
federal alternative minimum tax for both individuals and corporations. ^
TAXABLE INCOME DIVIDENDS. Some securities held by the Tax-Exempt Portfolio may
pay interest that is taxable as ordinary income.
CAPITAL GAINS. Any capital gains distributions from the Tax-Exempt Portfolio are
taxable as capital gains.
SOCIAL SECURITY AND RAILROAD RETIREMENT BENEFITS. Exempt-interest dividends from
the Tax-Exempt Portfolio are included in the calculation of total income for
recipients of Social Security or railroad retirement benefits. As a result,
although the exempt-interest dividends from the Portfolio are still tax-exempt,
they may be figured into the calculation of how much of a recipient's Social
Security or railroad retirement income is taxed.
CAPITAL LOSS ALLOWANCE. If shares of a Portfolio that earned exempt-interest
dividends are redeemed at a loss after being held for six months or less, part
of the loss will be disallowed for income tax purposes, to the extent of
exempt-interest dividends that were earned on the shares. It is anticipated that
this situation could only occur for shareholders in the Tax-Exempt Portfolio.
SOME STATE TAX EXEMPTIONS
In some states, shareholders are not subject to state taxation on distributions
made by a registered investment company that were derived from interest on or
portions of their account value attributed to direct or indirect obligations of
the U.S. government. This exemption generally does not apply to dividends
derived from interest on obligations issued by agencies or instrumentalities of
the U.S. government, or interest earned on repurchase obligations secured by
such obligations or direct obligations of the U.S. government. See Securities in
Which the Portfolios Invest for an explanation of these securities and
transactions.
^
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<PAGE>
TAX STATEMENTS
Tax forms related to dividends and other distributions paid by a Portfolio are
mailed annually. For most types of accounts, IDEX will report the proceeds of
redemptions to shareholders and the Internal Revenue Service ("IRS") annually.
Average cost basis information on non-retirement plan account redemptions is not
currently reported to the IRS.
TAX WITHHOLDING
Each Portfolio, except the Tax-Exempt Portfolio, is required to withhold 31% of
all dividends, and each Portfolio, including the Tax-Exempt Portfolio, is
required to withhold 31% of capital gains distributions and redemption proceeds,
paid on behalf of any individuals and certain other noncorporate shareholders
who do not furnish the Portfolio with a correct taxpayer identification number.
Withholding from income distributions and capital gain distributions also is
required for shareholders who otherwise are subject to backup withholding
according to the IRS.
NOTE: The foregoing is only a general summary of some of the important federal
tax considerations under current law generally affecting each Portfolio and its
shareholders; see the SAI for further discussion. Because there may be other
federal, state or local tax considerations applicable to a particular
shareholder, shareholders are urged to consult their own tax advisers.
SHAREHOLDER INFORMATION AND INSTRUCTIONS
This section discusses buying, selling, and exchanging shares of a Portfolio;
sales charges and possible waivers and discounts; and general shareholder
account information.
If you need help or additional forms, call IDEX Customer Service at (800)
851-9777 M-F, 8 a.m-7 p.m. Eastern Time, or contact your representative.
HOW TO BUY SHARES
1. OPEN AN ACCOUNT
Complete the New Account Application form included with this prospectus and send
it to IDEX. IRAs and other retirement accounts require a different application.
To open an IRA, call or write your registered representative or IDEX for an IRA
application. If you already have an account in an IDEX Portfolio, you may open
an account in another IDEX Portfolio with the same account features by calling
or writing to IDEX.
NOTE: You must include your Social Security or other Taxpayer Identification
Number with your application, or your account may be subject to backup
withholding or may be closed.
The Fund reserves the right to reject any purchase.
2. CHOOSE A, B, OR C SHARES
For a complete discussion of A, B, and C shares, and help in understanding which
choice may be best for you, see Which Class of Shares Should You Buy, below, or
contact your financial adviser. Be sure to specify which Class of shares you
want to buy.
NOTE: Class T shares of the Growth Portfolio are not available to new investors;
only existing Class T shareholders (who were shareholders of IDEX Fund or IDEX
Fund 3 on September 20, 1996) may purchase additional Class T shares.
3. PAY FOR YOUR SHARES
You may buy shares in the following ways:
o By check:
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<PAGE>
Make your check payable to IDEX Mutual Funds and send it to:
IDEX INVESTOR SERVICES, INC.
P.O. BOX 9015
CLEARWATER, FL 34618-9015
or
201 HIGHLAND AVENUE
LARGO, FL 33770-2597
o By Automatic Investment Plan:
With an Automatic Investment Plan, you choose to invest a dollar amount on a
regular basis, and have that amount deducted from a bank account on any day
between the 3rd and 28th day of each month. Your money will be transferred via
ACH, an electronic banking process. To establish, change or discontinue an
Automatic Investment Plan, call or write IDEX Customer Service for instructions.
o By telephone:
Telephone purchase privileges may be established by writing IDEX, or you may
select telephone purchases on your New Account Application. Funds to pay for
telephone orders will be transferred electronically from your bank account to
IDEX via ACH. See also Other Information, Telephone Transactions.
o Through authorized dealers:
Orders of at least $1,000 ("confirmed purchases") may be issued through
authorized dealers. If you open a new account through a dealer, the dealer is
responsible for opening your account and providing your taxpayer ID number. If
you already have an IDEX account, no additional documentation is needed. Dealers
may pay for share orders with Federal funds bank wires by instructing their
banks to wire Federal funds as follows:
NATIONSBANK OF FLORIDA, N.A.
TAMPA, FLORIDA
ABA #: 063100277
DDA #: 3601194554
ATTN: IDEX INVESTOR SERVICES, INC.
CONFIRMED PURCHASE ORDER NUMBER(S)
SHAREHOLDER'S ACCOUNT NAME(S)
The dealer's bank may charge for a wire transfer. IDEX currently does not charge
for this service.
The Fund will not accept initial purchases for less than $500 worth of shares
(including the sales charge in the case of Class A or Class T shares) per
Portfolio account; however, purchases through plans for regular investment, like
the Automatic Investment Plan described above, do not require a minimum initial
investment. Investments made after the initial purchase must be at least $50 per
Portfolio account.
Purchases of shares generally must be "settled" (payment received by the Fund
and shares credited to your account) within three business days from when the
Fund accepts your purchase order. Therefore, the Fund must receive your payment
within that time. The Fund may charge a $15 fee (through a redemption of shares)
when a check, pre-authorized draft or an electronic transfer through ACH is
returned or rejected by the paying bank because of insufficient or uncollected
funds, or because of a stop payment order.
PER-SHARE PUBLIC OFFERING PRICE AND NET ASSET VALUE
Public offering price and net asset value ("NAV") per share refer to the
purchase price and value of one share of a class of a Portfolio, Class A, Class
B, Class C, or Class T, respectively. The public offering price of a Class A or
Class T share is its per share NAV plus the sales charge. With Class B or Class
C shares, there are no up-front sales charges, so the public offering price is
simply the NAV.
Net assets of an entire Portfolio are determined by adding the value of all
securities, receivables and other assets of the Portfolio, and subtracting
liabilities. However, for purposes of shareholder communication, public offering
price and NAV per share usually refer to the purchase price and value of one
share of one class of a Portfolio, respectively.
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<PAGE>
The number of shares that you buy is determined by the next NAV per share
calculated after IDEX receives and accepts your order to purchase shares. NAV is
determined separately for each class of shares of a Portfolio. Example: If you
buy $1,000 worth of Class B shares of a Portfolio, and the Portfolio's Class B
per-share NAV is $10, you will receive 100 Class B shares of that Portfolio. The
NAV per share of each class of a Portfolio is determined by the Fund's custodian
on each day that the New York Stock Exchange (the "Exchange") is open, as of the
close of the regular session of business on the Exchange. The Exchange currently
closes at 4:00 p.m. Eastern Time each day it is open.
Per share NAV for each share class is determined by dividing the net assets
allocable to that share class by the total number of shares outstanding of that
class.
In determining total net assets and thus, NAV per share, securities and other
portfolio investments are valued at market value. Investments for which
quotations are not readily available are valued at fair value determined in good
faith under the supervision of the Board of Trustees. The different expenses
incurred by each class of shares will result in different NAVs and dividends for
each class. The NAV of Class B and Class C shares will generally be lower than
the Class A share NAV of a given Portfolio, or Class T shares of the Growth
Portfolio, because Class B and Class C shares carry higher expenses.
CLASS A SHARES: SALES CHARGES, AVAILABLE DISCOUNTS
AND DEALER REALLOWANCES
When you buy Class A shares, you generally pay an up-front sales charge. When
you buy Class A shares you also pay ^ distribution ^ and service Fees up to
0.35% per year throughout your investment. You can reduce the up-front sales
charge percentage in four ways:
o By investing larger amounts.
o By investing under a "right of accumulation," which credits your account
for shares you already own in various IDEX Portfolios and helps you earn
discounts on new investments.
o By filing a "letter of intention" to buy enough shares within a 13 month
period to qualify for a reduced sales charge.
o By investing as part of a qualified group.
You generally pay no sales charge upon redemption of Class A shares. However, if
you pay no up-front sales charge because you are purchasing $1 million or more
of Class A shares, you will pay a deferred sales charge of 1% if you redeem any
of those shares within the first 12 months after buying them, unless they were
purchased through a qualified retirement plan. The charge is assessed on an
amount equal to the lesser of the then current market value or the original cost
of the shares being redeemed. No sales charge is imposed on increases in net
asset value above the initial purchase price.
WHAT IS A "DEALER REALLOWANCE"?
IDEX sells shares of its Portfolios both directly and through authorized dealers
in the United States and its territories. Your Portfolio receives the entire NAV
of shares sold. ISI retains the sales charge, then reallows uniform discounts
from the applicable public offering price to all of its dealers -- this is how
dealers are compensated.
From time to time, ISI will create special promotions with dealers, in which
dealers earn larger reallowances in return for selling significant amounts of
shares or in return for certain training services. Sometimes, these dealers may
earn virtually the entire sales charge; at those times, they may be deemed
underwriters as described in the Securities Act of 1933.
Promotions may also involve non-cash incentives such as prizes or merchandise.
Non-cash compensation may also be in the form of attendance at seminars
conducted by ISI, including lodging and travel expenses.
Reallowances may also be given to banks or other financial institutions to
compensate them for their services in connection with Class A share sales and
servicing of shareholder accounts.
ISI may also pay dealers, banks or other institutions from its own funds for
administrative services in connection with larger accounts.
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<PAGE>
DISCOUNTS THROUGH A RIGHT OF ACCUMULATION
If you already own Class A shares of certain IDEX Portfolios, or Class T shares
of the Growth Portfolio, you may be able to get a sales charge discount when you
buy new shares of Portfolios described in this Prospectus. The value of the
shares you already own may be "accumulated" -- i.e., counted together with the
value of the new shares you plan to buy -- to achieve quantities eligible for
discount. Ask your sales representative for information, or call IDEX Customer
Service.
DISCOUNTS THROUGH A LETTER OF INTENTION
You may also earn a sales charge discount on Class A shares or Class T shares of
the Growth Portfolio by making a written commitment to invest, within a 13-month
period, an amount which qualifies for discount. This written commitment, called
a Letter of Intention ("LOI"), is not a binding legal obligation.
Shares purchased under the terms of an LOI will be purchased at the public
offering price -- NAV plus discounted sales charge -- which applies to the total
value of the shares you commit to buy during the period of the LOI. During this
period, your share purchases are subject to the following rules:
o The first 5% of the amount that you agree to invest will be placed in
escrow until the LOI is fulfilled or 13 months has expired.
o Future changes in quantity discounts (breakpoints) will apply to purchases
under the LOI.
o Sales charge adjustments will be made if you actually buy more or less than
you commit to buy during the period of your LOI.
o Shares bought up to 90 days before an LOI may be included in your LOI. The
LOI, however, will start on the day of the first purchase that is included
under the LOI.
o Right of accumulation can apply to an LOI. That is, the current value of
all previous purchases into Class A shares that paid a sales charge can be
counted towards fulfillment of the LOI, but the sales charges on these
previous purchases will not be adjusted.
o Dividends and capital gains must be reinvested in additional shares. No
cash distributions are allowed under an LOI.
You may elect to invest under an LOI on your New Account Application. For more
information about an LOI, consult your registered representative or call IDEX
Customer Service at (800) 851-9777.
DISCOUNTS AS A QUALIFIED GROUP
Members of a qualified group may purchase Class A shares at a reduced sales
charge applicable to the group within a specified period. IDEX takes into
account the anticipated aggregate amount of purchases by the group of Class A
shares and/or Class T shares. A "qualified group" is one which (i) has been in
existence for more than six months, (ii) has a purpose other than to acquire
shares of the Portfolio or similar investments and (iii) satisfies uniform
criteria that allows IDEX and other dealers offering Portfolio shares to realize
economies of scale. Pension or other employee benefit plan participants may be
eligible for qualified group purchases. The Fund reserves the right to modify or
terminate this privilege at any time. For information about qualifying groups,
call IDEX Customer Service.
WAIVER OF CLASS A SHARE SALES CHARGES FOR CERTAIN INDIVIDUALS
Class A shares of a Portfolio may be sold without sales charges to:
o Current or former trustees, trustees emeriti, directors, officers,
full-time employees or sales representatives of the Fund, IMI, ISI, Alger
Management, Scottish Equitable, GEIM, Janus Capital, C.A.S.E., NWQ, Luther
King, Dean Investment, AEGON Management, or any of their affiliates.
o Directors, officers, full-time employees and sales representatives of any
dealer having a sales agreement with ISI.
o Any trust, pension, profit-sharing or other benefit plan for any of the
foregoing persons.
o Any family members of the foregoing persons.
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<PAGE>
o "Wrap" accounts for the benefit of clients of certain broker-dealers,
financial institutions or financial planners, who have entered into
arrangements with the Fund or ISI.
Persons eligible to buy Class A shares at NAV may not impose a sales charge when
they re-sell those shares.
CLASS A SHARE QUANTITY DISCOUNTS
AGGRESSIVE GROWTH PORTFOLIO
INTERNATIONAL EQUITY PORTFOLIO
CAPITAL APPRECIATION PORTFOLIO
^ GLOBAL PORTFOLIO
GROWTH PORTFOLIO
C.A.S.E. PORTFOLIO
VALUE EQUITY PORTFOLIO
^ STRATEGIC TOTAL RETURN PORTFOLIO ^
TACTICAL ASSET ALLOCATION PORTFOLIO
BALANCED PORTFOLIO
REALLOWANCE
SALES CHARGE TO DEALERS
AS % OF AS A % SALES CHARGE
OFFERING OF OFFERING AS % OF
AMOUNT OF PURCHASE PRICE PRICE AMOUNT INVESTED
Less than $50,000 5.50% 4.75% 5.82%
$50,000 but less than $100,000 4.75% 4.00% 4.99%
$100,000 but less than $250,000 3.50% 2.75% 3.63%
$250,000 but less than $500,000 2.75% 2.25% 2.83%
$500,000 but less than $1,000,000 2.00% 1.75% 2.04%
$1,000,000 or more 0.00% 1.00%* 0.00%
* This amount is not a charge incurred by shareholders. ISI, at its own
expense, may make the following payments in accordance with its procedures
as may be in effect from time to time: 1.00% of the net asset value of
shares sold in amounts of $1,000,000 but less than $2,500,000; .75% of the
net asset value of shares sold in amounts of $2,500,000 but less than
$4,000,000; .50% of the net asset value of shares sold in amounts of
$4,000,000 but less than $5,000,000; and .25% of the net asset value of
shares sold in amounts of $5,000,000 or more. The privilege of purchasing
Class A shares at net asset value in amounts of $1,000,000 or more is not
available if another net asset value purchase privilege is also applicable.
NOTE: If you redeem Class A shares on which no up-front sales charge was imposed
because you invested $1 million or more during the first 12 months after buying
them, you will pay a deferred sales charge equal to 1% unless they were
purchased through a qualified retirement plan. You do not pay any deferred sales
charge when you redeem any Class A shares if you paid an up-front sales charge
on those shares, regardless of how long you have owned them.
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<PAGE>
<TABLE>
<CAPTION>
CLASS A SHARE QUANTITY DISCOUNTS
FLEXIBLE INCOME PORTFOLIO
INCOME PLUS PORTFOLIO
TAX-EXEMPT PORTFOLIO
SALES CHARGE REALLOWANCE SALES CHARGE
AS % OF TO DEALERS AS A % AS % OF
AMOUNT OF PURCHASE OFFERING PRICE OF OFFERING PRICE AMOUNT INVESTED
<S> <C> <C> <C>
Less than $50,000 4.75% 4.00% 4.99%
$50,000 but less than $100,000 4.00% 3.25% 4.17%
$100,000 but less than $250,000 3.50% 2.75% 3.63%
$250,000 but less than $500,000 2.25% 1.75% 2.30%
$500,000 but less than $1,000,000 1.25% 1.00% 1.27%
$1,000,000 or more 0.00% 0.50%* 0.00%
* This amount is not a charge incurred by shareholders. ISI, at its own
expense, may make the following payments in accordance with its procedures
as may be in effect from time to time: .50% of the net asset value of
shares sold in amounts of $1,000,000 but less than $2,500,000; .35% of the
net asset value of shares sold in amounts of $2,500,000 but less than
$4,000,000; .20% of the net asset value of shares sold in amounts of
$4,000,000 but less than $5,000,000; and .15% of the net asset value of
shares sold in amounts of $5,000,000 or more. The privilege of purchasing
Class A shares at net asset value in amounts of $1,000,000 or more is not
available if another net asset value purchase privilege is also applicable.
</TABLE>
NOTE: If you redeem Class A shares on which no up-front sales charge was imposed
because you invested $1 million or more during the first 12 months after buying
them, you will pay a deferred sales charge equal to 1% unless they were
purchased through a qualified retirement plan. You do not pay any deferred sales
charge when you redeem any Class A shares if you paid an up-front sales charge
on those shares, regardless of how long you have owned them.
CLASS B SHARES: SALES CHARGES, DEALER REALLOWANCES AND POSSIBLE WAIVERS
When you buy Class B shares, you pay no up-front sales charge. You pay ^
distribution and service fees up to 1.00% per year throughout your investment.
When you redeem your shares, you may incur a sales charge. This charge decreases
year by year.
The amount subject to sales charge is determined as follows:
o Dividends and capital gains, either in cash or reinvested shares, are not
subject to the sales charge.
o No sales charge is imposed on any increase in value of your shares.
o If your shares are worth less than when you bought them, the charge will be
assessed on their current (or lower) value.
o When you issue a redemption order for Class B shares, IDEX always sells the
longest-held shares first, then the next-longest held, and so forth, until
your redemption request is fulfilled.
For the purpose of calculating the contingent deferred sales charge, your
holding period for Class B shares always begins on the first day of the first
month after you pay for them.
Class B shares may not be purchased in individual amounts of more than $500,000.
In addition to the reallowances at the time of sale, dealers begin to earn an
annual service fee of up to 0.25% of average daily net assets on Class B shares
in the thirteenth month after their sale.
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<PAGE>
SALES CHARGE WAIVERS ON CLASS B SHARES
The sales charge on Class B shares may be waived in certain circumstances:
o Following the death of the shareholder.
o Following the total disability of the shareholder, as determined by the
Social Security Administration. The waiver applies only to shares held at
the time of the determination of the disability.
o On redemptions made under provisions of the Fund's systematic withdrawal
plan, but limited to 12% annually of the value of the account on the date
the systematic withdrawal plan is established.
o After selling Class B shares of one Portfolio, if you decide to reinvest
those proceeds within 90 days in Class B shares of another Portfolio, the
sales charge on your initial redemption will be waived.
See the SAI for complete information about Class B share sales charge waivers.
CLASS B SHARES
CONTINGENT DEFERRED SALES CHARGE
AS A PERCENTAGE OF DOLLAR AMOUNT
YEAR SINCE PURCHASE SUBJECT TO CHARGE*
First 5%
Second 4%
Third 3%
Fourth 2%
Fifth and Sixth 1%
Seventh and Later 0%
*The charge is assessed on an amount equal to the lesser of the then current
market value or the original cost of the shares being redeemed. No sales charge
is imposed on increases in net asset value above the initial purchase price.
CLASS B SHARE DEALER REALLOWANCES
Aggressive Growth Portfolio, International Equity Portfolio, Capital
Appreciation Portfolio, Global Portfolio, Growth Portfolio, C.A.S.E. Portfolio,
Value Equity Portfolio, Strategic Total Return Portfolio, Tactical Asset
Allocation Portfolio, Balanced Portfolio
AMOUNT OF CLASS B SHARES PURCHASED DEALER REALLOWANCE %
Up to $250,000 4.00%
$250,000 to $500,000 2.50%
Flexible Income Portfolio, Income Plus Portfolio, Tax-Exempt Portfolio
AMOUNT OF CLASS B SHARES PURCHASED DEALER REALLOWANCE %
Up to $250,000 3.00%
$250,000 to $500,000 2.00%
NOTE: Class B shares are not sold in amounts over $500,000.
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<PAGE>
CLASS C SHARES: SALES CHARGES AND DEALER REALLOWANCES
When you buy Class C shares, you pay no up-front sales charge. Throughout your
investment, you will be charged ^ distribution and service fees of up to 0.90%
per year.
The Tax-Exempt Portfolio intends to limit these fees to no more than 0.60% of
average daily net assets of its Class C shares.
ISI currently pays dealers for sales of Class C shares a distribution fee not to
exceed 0.90% per year of average daily net assets of Class C shares sold by that
dealer.
NOTE: The purpose and function of the contingent deferred sales charge on Class
B shares, and of the annual ^ distribution and service fees on Class B and Class
C shares, are the same as the purpose and function of the up-front commission
and annual ^ distribution and service fees on Class A shares and on Class T
shares of the Growth Portfolio.
CLASS T SHARES: SALES CHARGES AND AVAILABLE DISCOUNTS
Class T shares are not available to new investors; only existing Class T
shareholders (former IDEX Fund and IDEX Fund 3 shareholders) may buy Class T
shares of the Growth Portfolio. Class T shares are not subject to annual ^
distribution and service fees. When you buy Class T shares of the Growth
Portfolio, you generally pay an up-front sales charge. You can reduce the
up-front sales charge percentage in the following four ways, which are described
in more detail above under Class A Shares: Sales Charges, Available Discounts
and Dealer Reallowances.
o By investing larger amounts.
o By investing under a "right of accumulation," which credits your account
for shares you already own in various IDEX Portfolios and helps you earn
discounts on new investments.
o By filing a "letter of intention" to buy enough shares within a 13 month
period to qualify for a reduced sales charge.
o By investing as part of a qualified group.
You generally pay no sales charge upon redemption of Class T shares. However, if
you pay no up-front sales charge because you are purchasing $1 million or more
of Class T shares, you will pay a deferred sales charge of 1% if you redeem any
of those shares within the first 12 months after buying them, unless they were
purchased through a qualified retirement plan. The charge is assessed on an
amount equal to the lesser of the then current market value or the original cost
of the shares being redeemed. No sales charge is imposed on increases in net
asset value above the initial purchase price.
WAIVER OF CLASS T SHARE SALES CHARGES FOR CERTAIN INDIVIDUALS
Class T shares of a Portfolio may be sold without sales charges to:
o Current or former trustees, trustees emeriti, directors, officers,
full-time employees or sales representatives of the Fund, IMI, ISI, Alger
Management, Scottish Equitable, GEIM, Janus Capital, C.A.S.E., NWQ, Luther
King, Dean Investment, AEGON Management, or any of their affiliates.
o Directors, officers, full-time employees and sales representatives of any
dealer having a sales agreement with ISI.
o Any trust, pension, profit-sharing or other benefit plan for any of the
foregoing persons.
o Any family members of the foregoing persons.
o "Wrap" accounts for the benefit of clients of certain broker-dealers,
financial institutions or financial planners, who have entered into
arrangements with the Fund or ISI.
Persons eligible to buy Class T shares at NAV may not impose a sales charge when
they re-sell those shares.
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<PAGE>
<TABLE>
<CAPTION>
CLASS T SHARE QUANTITY DISCOUNTS
GROWTH PORTFOLIO
SALES CHARGE REALLOWANCE SALES CHARGE
AS % OF TO DEALERS AS A % AS % OF
AMOUNT OF PURCHASE OFFERING PRICE OF OFFERING PRICE AMOUNT INVESTED
<S> <C> <C> <C>
Less than $10,000 8.50% 7.00% 9.29%
$10,000 but less than $25,000 7.75% 6.25% 8.40%
$25,000 but less than $50,000 6.25% 5.50% 6.67%
$50,000 but less than $75,000 5.75% 5.00% 6.10%
$75,000 but less than $100,000 5.00% 4.25% 5.26%
$100,000 but less than $250,000 4.25% 3.75% 4.44%
$250,000 but less than $500,000 3.00% 2.50% 3.09%
$500,000 but less than $1,000,000 1.25% 1.00% 1.27%
$1,000,000 or more 0.00% 1.00%* 0.00%
* This amount is not a charge incurred by shareholders. ISI, at its own
expense, may make the following payments in accordance with its procedures
as may be in effect from time to time: 1.00% of the net asset value of
shares sold in amounts of $1,000,000 but less than $2,500,000; .75% of the
net asset value of shares sold in amounts of $2,500,000 but less than
$4,000,000; .50% of the net asset value of shares sold in amounts of
$4,000,000 but less than $5,000,000; and .25% of the net asset value of
shares sold in amounts of $5,000,000 or more. The privilege of purchasing
Class T shares at net asset value in amounts of $1,000,000 or more is not
available if another net asset value purchase privilege is also applicable.
</TABLE>
NOTE: If you redeem Class T shares on which no up-front sales charge was imposed
because you invested $1 million or more during the first 12 months after buying
them, you will pay a deferred sales charge equal to 1% unless they were
purchased through a qualified retirement plan. You do not pay any deferred sales
charge when you redeem any Class T shares if you paid an up-front sales charge
on those shares, regardless of how long you have owned them.
WHICH CLASS OF SHARES SHOULD YOU BUY
Class A, Class B, Class C and Class T share commissions, dealer reallowances,
discounts, and possible waivers have been explained in the sections above. ONLY
EXISTING CLASS T SHAREHOLDERS (FORMER IDEX FUND AND IDEX FUND 3 SHAREHOLDERS)
MAY PURCHASE CLASS T SHARES OF THE GROWTH PORTFOLIO.
Please consult with your registered representative to decide which class of
shares is appropriate for you. Which class makes the most sense for you will
depend upon your particular circumstances and investment goals. The Fund
provides these classes of shares with differing charges so that you can choose
what makes sense in your situation. Some things you should think about:
o How much you intend to invest. For example, Class A and Class T shares have
an initial sales charge, but if you invest more you may get a lower
percentage sales charge or no sales charge at all on Class A or Class T
shares.
o How long you intend to keep shares. Class B shares charge a sales load upon
redemption during the first six years, but the amount declines each year
and goes to zero if you keep your shares more than six years. However,
Class A or Class T shares on which you pay an up-front sales charge and
Class C shares (that do not have any up-front sales charges) are not
subject to any sales charges when you redeem.
o Whether you think you will keep your shares long enough that the higher
annual distribution and services fees paid by Class B or Class C shares
will add up to more than the up-front sales charge on Class A or Class T
shares, based on the amount you are investing. Remember that if you hold
Class B shares for eight years they automatically become Class A shares
(which have a lower annual distribution and service fee than Class B or
Class C shares of the Fund), even though you do not pay any up-front sales
charge. Class C shares have lower distribution and service charges than
Class B shares, but Class C shares do not convert to Class A shares free of
the sales charge. Class T shares of the Growth Portfolio have a higher
up-front sales charge, but are not subject to annual ^ distribution and
service fees.
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NOTE: For a hypothetical comparison of the expenses which you might incur with a
$1,000 investment in Class A, Class B, Class C or Class T shares, see Examples
of Expenses under Summary of Expenses.
Class A, Class B, Class C and Class T shares of a Portfolio represent interests
in the same portfolio of investments. They generally have the same rights.
However, each class of shares bears separate expenses for distribution and
service and other expenses pertaining to that class. Each class of shares has
separate voting rights on its distribution plan, or on any other matters
involving only that class.
Dividends and other distributions are calculated in a similar fashion and paid
at the same time for each class of shares. The per share dividends from net
investment income on Class B and Class C shares are expected to be lower than
those from Class A or Class T shares because of Class B and Class C shares'
higher expenses.
CLASS A CLASS B CLASS C CLASS T
Up-front sales charge Yes No No Yes
Higher ongoing distribution
and service fees No Yes Yes No
Sales charge on redemption No** Yes* No No**
Quantity sales charge
discounts available Yes No No Yes
* The redemption charge on Class B shares declines year by year and reaches
0% after six years. After eight years, Class B shares convert to Class A
shares, which are subject to lower ongoing fees.
** A 1% deferred sales charge will be applied to any redemption within 12
months of a $1 million purchase on which no up-front sales charge was
imposed, unless the shares were purchased through a qualified retirement
plan.
HOW TO REDEEM (SELL) SHARES
GENERAL INFORMATION. You may redeem (sell) your shares at any time at the next
determined NAV after IDEX receives your redemption request. For information
about how NAV is determined, see Per-Share Public Offering Price and Net Asset
Value under How to Buy Shares.
Your transaction will be processed at the NAV on the day your redemption request
is received. IDEX will normally pay you for your shares within three days of
receiving a valid redemption request. However, shares purchased by check or ACH
are not considered part of your collected/available balance for 15 days;
therefore, the Fund may not send payment of such redemption proceeds for up to
15 days from the purchase date to allow for sufficient clearing time.
Your check will be sent by first-class mail. You can pay $20 (by check or
deduction from your account) for overnight delivery, if you wish, and if the
service is available to your account address.
Redemption and repurchase of shares may be suspended or payment postponed during
any period when the Exchange is closed (other than on weekends or customary
holidays) or trading on the Exchange is restricted, or during a period of an
emergency or other periods during which the SEC permits such suspension.
This section describes selling shares for cash. For other circumstances, see
Redemption of Shares in the SAI.
As described under How to Buy Shares, Class B and certain Class A and Class T
share sales will be charged the appropriate contingent deferred sales charge
applicable to certain redemptions.
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TO REDEEM SHARES BY MAIL. Send your redemption request to:
IDEX INVESTOR SERVICES, INC.
ATTENTION: REDEMPTIONS
P.O. BOX 9015
CLEARWATER, FL 34618-9015.
Your redemption request must be signed by the owner(s) of the account, or by a
person authorized to act for the owner(s).
o Include the name of the Portfolio, the class of shares, the number of
shares or dollar amount of shares to be sold, the account number, and the
name(s) on the account.
o If you have previously requested share certificates, they must be returned
if you wish to redeem these shares.
o Your signature may have to be guaranteed. See Signature Guarantees below.
Evidence of the authority of the person seeking a redemption is required for all
written redemptions of shares held in the name of a corporation, a partnership,
trust or fiduciary.
SIGNATURE GUARANTEES. For your protection, a signature guaranteed written
request will be required for the following transactions:
o redemption requests larger than $100,000.
o redemption requests of any size made in an account where the address has
been changed within the past 10 days.
o redemptions by check made payable to someone other than the name on the
account, and/or sent to an address other than the address of record.
o redemptions by Federal funds bank wire to a bank that is not pre-designated
on your account.
o certain requests to change the registered owners of an account.
o to change certain arrangements in your systematic withdrawal plan or cash
dividend payment details.
This guarantee must be made by a national or state bank, a member firm or a
national stock exchange, or any other eligible guarantor as defined by the SEC.
Notarization is not an acceptable substitute. IDEX may require signature
guarantees for certain other circumstances.
TO REDEEM SHARES BY TELEPHONE AND RECEIVE YOUR MONEY BY CHECK. You may redeem
shares in amounts up to $50,000 by phone per day and receive your money by check
unless you have declined this privilege on the New Account Application. Call
(800) 851-9777 to request a phone redemption.
Telephone redemption with payment by check is not allowed in the following
situations:
o For shares purchased by check or ACH within the past 15 days.
o For retirement accounts (except IRAs, which will be subject to 10%
withholding).
o For shares represented by certificates.
o In amounts over $50,000.
o In accounts where the address has been changed within the past 10 days.
If the account is held in more than one name, IDEX may accept the telephone sale
order of any one account holder. IDEX will employ reasonable procedures to
confirm that all telephone instructions are genuine. Your registered
representative may redeem shares on your behalf by telephone unless you have
declined the telephone redemption privilege on your New Account Application.
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The Fund reserves the right to alter or modify the telephone redemption
privilege. See Other Information -- Telephone Transactions for further
information.
TO REDEEM SHARES BY TELEPHONE AND RECEIVE YOUR MONEY ELECTRONICALLY BY ACH OR
BANK WIRE. You may sell up to $50,000 worth of shares by phone and receive your
money by ACH or Federal funds bank wire to a pre-authorized bank account. To
receive this privilege, complete the appropriate section of the New Account
Application. If you already have an account, and wish to add the electronic
payment privilege, mail a signature guaranteed letter and bank information
(usually a voided check) to IDEX. ACH transfers usually take three banking days.
No fee is currently charged for this service.
Funds sent via Federal funds bank wire usually arrive on the next banking day.
Each time you have money wired to your bank account via a Federal funds wire, a
$10 fee will be charged. This amount will be deducted from your account by the
sale of shares. The receiving bank may also charge you a fee. Federal funds wire
transfers require a minimum redemption of $1,000. If you do not have the wire
transfer privilege, and do not want to establish it as a standing privilege on
your account, you may still redeem shares and receive funds at a U.S. bank via
Federal funds wire by writing a letter of instruction to IDEX. A Federal funds
wire redemption requires a signature guarantee.
TO REDEEM SHARES THROUGH A REGISTERED DEALER. You may also place confirmed
redemption requests through registered securities dealers. Some of these dealers
use the National Securities Clearing Corporation ("NSCC") electronic order
system. It is the responsibility of such dealers to transmit your sell orders
promptly. Payment for these redemption requests will be made to the dealer
within three days after IDEX receives your order, properly signed, including
share certificates and appropriate signature guarantees where necessary. IDEX
reviews all such orders.
TO REDEEM SHARES AUTOMATICALLY, AT REGULAR INTERVALS. You may establish a
systematic withdrawal plan ("SWP") on your New Account Application or by calling
Customer Service to obtain the forms. To establish an SWP, you must:
o Have an account worth at least $10,000 (unless this is an IRA account).
o Withdraw only up to 12% annually of the value of your account, if you own
Class B shares.
o Withdraw at least $50 with each redemption.
You may receive your money by direct deposit via ACH to your bank account or by
check to your address of record.
Withdrawals paid by direct deposit can be made on any day you select between the
3rd and 28th of the month; withdrawals paid by check are available only on a
fixed date each month, which is normally seven to ten days before the first of
the month. The Fund cannot guarantee that you will receive your money exactly by
the date you select. You may make withdrawals monthly, quarterly, or annually.
Special considerations in using an SWP:
o If an SWP is established on a new account, the initial disbursement can not
normally be made within 15 days of the date of your initial purchase.
o Dividends and capital gains distributions on accounts with an active SWP
are usually paid in additional shares of the Portfolio.
o If the requested payments under an SWP require sale of more shares than
have been credited through the payment of dividends and capital gains
distributions in additional shares, your original investment may be
depleted and ultimately exhausted.
o Payments under an SWP probably will include some amount of your original
investment and are taxable events.
o An SWP may not be advantageous to maintain while you simultaneously buy
shares in the same portfolio; you'll pay more in sales charges than you
have to.
o You can change or cancel an SWP at any time by writing or calling IDEX. An
SWP will be terminated when all shares in an account have been redeemed, or
when IDEX receives notice of the account holder's death.
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REINVESTMENT PRIVILEGE
If you sell Class A, Class B or Class T shares, you may repurchase Class A,
Class B or Class T shares in any Portfolio of the same class, in an amount not
more than the amount you sold without incurring a new sales charge. To do this,
you must send a check accompanied by a written request to IDEX within 90 days
after you sell your shares. IDEX reserves the right to modify or eliminate this
reinvestment privilege at any time.
When you exercise this reinvestment privilege:
o You may reinvest the proceeds of a Class A or Class T share sale in shares
of the same class without paying the up-front commission;
o You may reinvest the proceeds of a Class B share sale in Class B shares,
and your new shares will be considered the same age as your old shares --
i.e., if you sell three-year-old shares and buy new shares, the new shares
will be, effectively, three years old, and therefore subject to a smaller
contingent deferred sales charge;
o The contingent deferred sales charge you paid when you sold your Class B
shares will also be reinvested in new Class B shares;
o Alternatively, you may reinvest the proceeds of a Class B share sale (less
the contingent deferred sales charge paid) in Class A shares without paying
the up-front sales charge on these Class A shares.
NOTE: Certain distributions from qualified plans are not eligible for this
privilege.
HOW TO EXCHANGE SHARES
GENERAL INFORMATION. You may exchange shares of one Portfolio for shares in the
same class of another Portfolio. No sales charges are imposed at the time of an
exchange; exchanges must be made in amounts of $500 or more. You may exchange
Class A shares for Class A shares, Class B shares for Class B shares, and Class
C shares for Class C shares, among any of the Portfolios in this Fund.
Class T Shares may be exchanged only for Class A shares of the IDEX Portfolios
other than the Growth Portfolio. There will be no sales charges imposed on such
exchanges; however Class A shares of all IDEX Portfolios are subject to 12b-1
distribution and service fees. Shareholders may not exchange other classes of
shares of the IDEX Portfolios for Class T shares.
In the case of Class B share exchanges, the contingent deferred sales charge
will be calculated from the date you bought your original shares -- i.e., your
new shares will be the same age as your old shares, so your sales charge will
not increase.
In addition, you may exchange Class A, Class C or Class T shares for any of the
three portfolios of the Cash Equivalent Fund or the California Tax-Exempt Money
Market Fund. Class B shares may be exchanged only for the Cash Equivalent Money
Market Portfolio. See Money Market Fund Exchange Privilege, below.
You automatically have the telephone exchange privilege unless you decline it on
your New Account Application.
Exchanges may be requested by telephone or in writing. Call or write IDEX
Customer Service.
You may exchange all the shares in one account for shares in another account.
All special account features present in the old account, such as Automatic
Investment Plan, Letter of Intention, or Systematic Withdrawal/Exchange Plan,
will be transferred to the new account, unless IDEX is otherwise instructed.
You may exchange part of the shares in one account and open a new account for
new shares in another Portfolio. In partial exchanges, all special account
features except Automatic Investment Plan and Systematic Withdrawal/Exchange
Plan will be transferred to the new account, unless IDEX is otherwise
instructed.
Before making an exchange into a Portfolio which is new to you, read the
Prospectus carefully. Obtain Prospectuses by calling or writing IDEX Customer
Service.
The Fund reserves the right to limit exchanges or modify or terminate the
exchange privilege at any time.
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<PAGE>
TELEPHONE EXCHANGES. Call IDEX Customer Service at (800) 851-9777 to request a
telephone exchange. New shares acquired by telephone exchange must be registered
in exactly the same name as the shares sold by telephone exchange. See Other
Information -- Telephone Transactions for more information.
SYSTEMATIC EXCHANGES. You may choose, either on your New Account Application, or
by calling or writing IDEX, to exchange shares of the same class automatically
at regular intervals from one Portfolio to another. All conditions described
above under General Information also apply to systematic exchanges.
New shares acquired by systematic exchange must be registered in exactly the
same name as the shares sold in a systematic exchange.
MONEY MARKET FUND EXCHANGE PRIVILEGE. You may make sales charge-free exchanges
of at least $500 at NAV from Class A, Class C or Class T shares to any of the
three portfolios of the Cash Equivalent Fund or the California Tax-Exempt Money
Market Fund. Class B shares may be exchanged without sales charge, minimum $500
at NAV, only into the Cash Equivalent Money Market Portfolio.
You may also sell your shares of any of the Money Market Funds in minimum
amounts of $500 and invest the proceeds in the same class of shares of any of
the other Portfolios.
Sales charges will be applied to exchanges from Money Market Funds when you have
originally invested in these Money Market Funds, then decided to exchange for
shares of a Portfolio in the Fund.
Systematic exchanges may also be made between the Money Market Funds and the
Portfolios of the Fund. See Systematic Exchanges, above, for conditions.
These Funds (the "Money Market Funds"), which are separately managed by Zurich
Kemper Investments, Inc., are open-end, diversified money market mutual funds.
Sales of shares in connection with Money Market Fund exchanges will be effected
as of the end of the day when your exchange request is received, if it is
received before 4:00 p.m. Eastern time.
This exchange privilege does not constitute an offering or recommendation of
Money Market Fund shares by the Fund. Before making a Money Market Fund
exchange, you should consider the investment objective of the Money Market Fund
and read its current Prospectus.
You may request a Money Market Fund exchange by calling or writing IDEX Customer
Service.
CLASS B SHARES -- SALES CHARGE DETERMINATION IN MONEY MARKET FUND EXCHANGES.
When you exchange Class B shares of a Portfolio for Class B shares of the Cash
Equivalent Money Market Portfolio, you will not be charged a contingent deferred
sales charge. You will be charged the sales charge if you subsequently sell the
Class B shares of the Cash Equivalent Money Market Portfolio, but the time you
held the shares of the Cash Equivalent Money Market Portfolio will not count
toward figuring the sales charge.
Similarly, if you exchange Class B shares of the Cash Equivalent Money Market
Portfolio back for Class B shares of a Portfolio of the Fund, no sales charge
will be made. However, when you eventually sell the Class B shares of your
Portfolio, you will pay the deferred sales charge, which is determined only for
the time you hold Class B shares in the Fund. The time you held Class B shares
of the Cash Equivalent Money Market Portfolio does not count toward figuring
your ultimate sales charge.
OTHER INFORMATION
MINIMUM ACCOUNT BALANCE. A $10 semi-annual fee will be charged on accounts with
balances below $500. Accounts with balances ^ that fall below $250 due to
redemptions will be liquidated (deducting any applicable sales charge for Class
B shares), and a check will be mailed to the address of record.
No fees will be charged on accounts opened within the preceding 24 months,
accounts with an active monthly Automatic Investment Plan ($50 minimum per
account) or accounts owned by individuals whose multiple accounts with the same
social security number have a combined balance totalling $10,000 or more.
Before a minimum account fee is assessed or an account is liquidated,
shareholders will be given 60 days notice and will have the opportunity to
increase the account balance to at least $500 or to start a monthly Automatic
Investment Plan.
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REPURCHASE ARRANGEMENTS. For the convenience of its shareholders, the Fund has
authorized ISI to act as its agent in the repurchase of Fund shares. This
procedure may be terminated at any time. If you sell your shares to ISI through
a dealer, your dealer may charge you an additional fee.
RETIREMENT PLANS. Class A, Class B, Class C and Class T shares may be purchased
in qualified retirement plans, including individual retirement accounts (IRAs),
401(k)s, Simplified Employee Pension Plans (SEP-IRAs), corporate and self-
employed pension and profit sharing plans (Keoghs) and 403(b)(7) programs.
Retirement plans require a different application. Please do not try to open a
retirement plan with the application in this Prospectus. Call or write IDEX
Customer Service to obtain the application.
Retirement plan accounts naming IFTC as custodian are ordinarily charged a $15
per year maintenance fee, with a maximum of $30 per year per taxpayer ID number.
However, if combined retirement account balances per taxpayer ID number, under
IFTC as custodian, are more than $50,000, there is generally no fee.
The SAI contains more information about retirement plans. Investors should
consult with their tax advisers about tax-deferral issues in such plans.
TELEPHONE TRANSACTIONS. The Fund, ISI and IDEX will not be liable for complying
with telephone instructions, and investors will bear the risk of loss. The Fund,
ISI and/or IDEX will employ reasonable procedures to make sure telephone
instructions are genuine. These procedures may include, among others, requiring
forms of personal identification, providing written confirmation of telephone
transactions and/or tape recording telephone orders. If the Fund, ISI and/or
IDEX do not employ such reasonable procedures, they may be held liable for loss
due to fraudulent or unauthorized telephone instructions.
HOW TRANSACTIONS ARE CONFIRMED. After most account transactions, except when
shares are bought with reinvested dividends and capital gains distributions, and
except for automatic redemptions or purchases via ACH, you will receive a
statement. This statement will show the details of the transaction, the number
of shares held in your account and the transactions since the beginning of the
year. You will receive a quarterly statement which details all your financial
transactions for the period indicated, including dividend and capital gain
distribution reinvestments as well as your ACH transactions.
HISTORICAL STATEMENTS. You may order a historical statement covering years
before the current year.
SHARE CERTIFICATES. Account holders ordinarily do not want share certificates.
Shares are normally recorded on the Fund's books and no certificates are issued.
You may, however, obtain certificates for your shares, with these limitations:
o No certificates will be issued for fractional shares.
o No certificates will be issued for accounts holding less than 30 shares,
except in connection with sales or transfers of shares from other funds
when you already hold certificates.
o Certificates are issued only as your account is registered.
o Certificates are not issued for retirements plan accounts with IFTC as
custodian.
If you want certificates representing your shares, you may call or write IDEX to
request them. You may return share certificates to IDEX for re-deposit at any
time. Notify IDEX immediately if your certificates are lost or stolen. There may
be a charge for cancelling and replacing lost or stolen share certificates.
Remember that if you ask for a certificate for your shares, you will not be able
to redeem or exchange your shares by telephone. You will have to send your share
certificate to IDEX in order to redeem or exchange those shares.
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APPENDIX A
BRIEF EXPLANATION OF RATING CATEGORIES
BOND RATING EXPLANATION
STANDARD & POOR'S AAA Highest rating; extremely strong capacity to
CORPORATION pay principal and interest.
AA High quality; very strong capacity to pay
principal and interest.
A Strong capacity to pay principal and
interest; somewhat more susceptible to the
adverse effects of changing circumstances and
economic conditions.
BBB Adequate capacity to pay principal and
interest; normally exhibit adequate
protection parameters, but adverse economic
conditions or changing circumstances
more likely to lead to a weakened capacity
to pay principal and interest than for higher
rated bonds.
BB,B Predominantly speculative with respect to the
CCC, CC, C issuer's capacity to meet required interest
and principal payments. BB - lowest degree of
speculation; C - highest degree of
speculation. Quality and protective
characteristics outweighed by large
uncertainties or major risk exposure to
adverse conditions.
D In default.
MOODY'S INVESTORS Aaa Highest quality, smallest degree of
SERVICE, INC. investment risk.
Aa
High quality; together with Aaa bonds,
they compose the high-grade bond group.
A Upper-medium grade obligations; many
favorable investment attributes.
Baa Medium-grade obligations; neither highly
protected nor poorly secured. Interest and
principal appear adequate for the
present but certain protective elements
may be lacking or may be unreliable over any
great length of time.
Ba More uncertain, with speculative elements.
Protection of interest and principal payments
not well safeguarded during good and bad
times.
B Lack characteristics of desirable investment;
potentiallylow assurance of timely interest
and principal payments or maintenance of
other contract terms over time.\
Caa Poor standing, may be in default; elements of
danger with respect to principal or interest
payments.
Ca Speculative in a high degree; could be in
defalut or have other marked shortcomings.
C Lowest-rated; extremely poor aspects of ever
attaining investment standing.
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SECURITIES HOLDINGS BY RATING CATEGORY
During the period ended October 31, 1996, the percentage of securities holdings
by rating category based upon a weighted average was:
BONDS - S&P RATING FLEXIBLE INCOME PORTFOLIO INCOME PLUS PORTFOLIO
- ----------------------------------------------------------------------------
AAA 11.4% 1.5%
AA 3.7% --
A 13.0% 11.8%
BBB 15.1% 36.0%
BB 13.6% 16.4%
B 21.1% 14.9%
CCC -- --
CC -- 5.2%
C/NR 7.3% --
Preferred Stock/NR 4.1% --
Cash, Equivalents and 10.7% 14.7%
Assets Less Liabilities
Total 100% 100%
- ----------------------------------------------------------------------------
No other Fund held 5% or more of its assets in bonds rated below investment
grade, including unrated bonds deemed to be the equivalent of non-investment
grade securities, for the period ended October 31, 1996. Unrated securities and
securities that have received different ratings from more than one agency will
be treated as noninvestment grade securities unless the portfolio manager
determines that such securities are the equivalent of investment grade
securities.
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APPENDIX B
GLOSSARY OF INVESTMENT TERMS
This glossary provides a more detailed description of the types of securities in
which the Portfolios may invest. The Portfolios may invest in these securities
to the extent permitted by their investment objectives and policies. The
Portfolios are not limited by this discussion and may invest in ANY type of
security unless precluded by the policies discussed elsewhere in this Prospectus
or in the SAI.
I. EQUITY AND DEBT SECURITIES
BONDS ARE DEBT SECURITIES issued by a company, municipality or government
agency. The issuer of a bond is required to pay the holder the amount of the
loan (or par value) at a specified maturity and to make scheduled interest
payments.
CERTIFICATES OF PARTICIPATION ("COPS") are certificates representing an interest
in a pool of securities. Holders are entitled to a proportionate interest in the
underlying securities. Municipal lease obligations are often sold in the form of
COPs. See "Municipal lease obligations" below.
COMMERCIAL PAPER is a short-term debt obligation with a maturity ranging from 1
to 270 days issued by banks, corporations and other borrowers to investors
seeking to invest idle cash. The Portfolios may purchase commercial paper issued
under Section 4(2) of the Securities Act of 1933. The Portfolios may determine
that such securities are liquid under guidelines established by the Trustees.
COMMON STOCK represents a share of ownership in a company and usually carries
voting rights and earns dividends. Unlike preferred stock, dividends on common
stock are not fixed but are declared at the discretion of the issuer's board of
directors.
CONVERTIBLE SECURITIES are preferred stocks or bonds that pay a fixed dividend
or interest payment and are convertible into common stock at a specified price
or conversion ratio.
DEPOSITARY RECEIPTS are receipts for shares of a foreign-based corporation that
entitle the holder to dividends and capital gains on the underlying security.
Receipts include those issued by domestic banks (American Depositary Receipts),
foreign banks (Global or European Depositary Receipts) and broker-dealers
(depositary shares).
FIXED-INCOME SECURITIES are securities that pay a fixed rate of return. The term
generally includes short- and long-term government, corporate and municipal
obligations that pay a fixed rate of interest or coupons for a specified period
of time and preferred stock, which pays fixed dividends. Coupon and dividend
rates may be fixed for the life of the issue or, in the case of adjustable and
floating rate securities, for a shorter period.
HIGH-YIELD/HIGH-RISK BONDS are securities that are rated below investment grade
by the primary rating agencies (BB or lower by Standard & Poor's and Ba or lower
by Moody's). Other terms commonly used to describe such securities include
"lower rated bonds," "non-investment grade bonds" and "junk bonds."
INDUSTRIAL DEVELOPMENT BONDS are revenue bonds that are issued by a public
authority but which may be backed only by the credit and security of a private
issuer and may involve greater credit risk. See "Municipal securities" below.
MORTGAGE- AND ASSET-BACKED SECURITIES are shares in an organized pool of
mortgages or other debt. These securities are generally pass-through securities,
which means that principal and interest payments on the underlying securities
(less servicing fees) are passed through to shareholders on a pro rata basis.
These securities involve prepayment risk, which is the risk that the underlying
mortgages or other debt may be refinanced or paid off prior to their maturities
during periods of declining interest rates. In that case, a portfolio manager
may have to reinvest the proceeds from the securities at a lower rate. Potential
market gains on a security subject to prepayment risk may be more limited than
potential market gains on a comparable security that is not subject to
prepayment risk.
MUNICIPAL LEASE OBLIGATIONS are revenue bonds backed by leases or installment
purchase contracts for property or equipment. Lease obligations may not be
backed by the issuing municipality's credit and may involve risks not normally
associated with general obligation bonds and other revenue bonds. For example,
their interest may become taxable if the lease is assigned and the holders may
incur losses if the issuer does not appropriate funds for the lease payments on
an annual basis, which may result in termination of the lease and possible
default.
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MUNICIPAL SECURITIES are bonds or notes issued by a U.S. state or political
subdivision. A municipal security may be a general obligation backed by the full
faith and credit (i.e., the borrowing and taxing power) of a municipality or a
revenue obligation paid out of the revenues of a designated project, facility or
revenue source.
PASSIVE FOREIGN INVESTMENT COMPANIES (PFICS) are foreign investment funds or
trusts. In addition to bearing their proportionate share of a Portfolio's
expenses, shareholders may indirectly bear similar expenses of PFICs and similar
trusts.
PREFERRED STOCK is a class of stock that generally pays dividends at a specified
rate and has preference over common stock in the payment of dividends and
liquidation. Preferred stock generally does not carry voting rights.
REPURCHASE AGREEMENTS involve the purchase of a security by a Portfolio and a
simultaneous agreement by a bank or dealer to repurchase the security from the
Portfolio at a specified date or upon demand. This technique offers a method of
earning income on idle cash. These securities involve the risk that the seller
will fail to repurchase the security, as agreed. In that case, a Portfolio will
bear the risk of market value fluctuations until the security can be sold and
may encounter delays and incur costs in liquidating the security.
REVERSE REPURCHASE AGREEMENTS involve the sale of a security by a Portfolio to
another party (generally a bank or dealer) in return for cash and an agreement
by the Portfolio to buy the security back at a specified price and time. This
technique may be used to provide cash to satisfy unusually high redemption
requests or for other temporary or emergency purposes.
STANDBY COMMITMENTS are obligations purchased by a Portfolio from a dealer that
give the Portfolio the option to sell a security to the dealer at a specified
price.
TENDER OPTION BONDS are generally long-term securities that have been coupled
with an option to tender the securities to a bank, broker-dealer or other
financial institution at periodic intervals and receive the face value of the
bond. This type of security is commonly used as a means of enhancing the
liquidity of municipal securities.
U.S. GOVERNMENT SECURITIES include direct obligations of the U.S. government
that are supported by its full faith and credit. Treasury bills have initial
maturities of less than one year, Treasury notes have initial maturities of one
to ten years and Treasury bonds may be issued with any maturity but generally
have maturities of at least ten years. U.S. government securities also include
indirect obligations of the U.S. government that are issued by federal agencies
and government sponsored entities. Unlike Treasury securities, agency securities
generally are not backed by the full faith and credit of the U.S. government.
Some agency securities are supported by the right of the issuer to borrow from
the Treasury, others are supported by the discretionary authority of the U.S.
government to purchase the agency's obligations and others are supported only by
the credit of the sponsoring agency.
WARRANTS are securities, typically issued with preferred stock or bonds, that
give the holder the right to buy a proportionate amount of common stock at a
specified price, usually at a price that is higher than the market price at the
time of issuance of the warrant. The right may last for a period of years or
indefinitely.
WHEN-ISSUED, DELAYED DELIVERY AND FORWARD TRANSACTIONS generally involve the
purchase of a security with payment and delivery due at some time in the future
(i.e., beyond normal settlement). The Portfolios do not earn interest on such
securities until settlement and bear the risk of market value fluctuations in
between the purchase and settlement dates. New issues of stocks and bonds,
private placements and U.S. government securities may be sold in this manner.
ZERO COUPON BONDS are debt securities that do not pay regular interest at
regular intervals, but are issued at a significant discount from face value. The
discount approximates the total amount of interest the security will accrue from
the date of issuance to maturity. Strips are debt securities that are stripped
of their interest (usually by a financial intermediary) after the securities are
issued. The market value of these securities generally fluctuates more in
response to changes in interest rates than interest-paying securities of
comparable maturity.
II. FUTURES, OPTIONS AND OTHER DERIVATIVES
FUTURES CONTRACTS are contracts that obligate the buyer to receive and the
seller to deliver an instrument or money at a specified price on a specified
date. The Portfolios may buy and sell futures contracts on foreign currencies,
securities and financial indices including interest rates or an index of U.S.
government, foreign government, equity or fixed-income securities. An option on
a futures contract gives the buyer the right, but not the obligation, to buy or
sell a futures contract at a specified price on or before a specified date.
Futures contracts and options on futures are standardized and traded on
designated exchanges.
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INDEXED/STRUCTURED SECURITIES are typically short- to intermediate-term debt
securities whose value at maturity or interest rate is linked to currencies,
interest rates, equity securities, indices or other financial indicators. Such
securities may be positively or negatively indexed (i.e. their value may
increase or decrease if the reference index or instrument appreciates).
Indexed/structured securities may have return characteristics similar to direct
investments in the underlying instruments and may be more volatile than the
underlying instruments. A Portfolio bears the market risk of an investment in
the underlying instruments, as well as the credit risk of the issuer.
INVERSE FLOATERS are debt instruments whose interest rate bears an inverse
relationship to the interest rate on another instrument.
OPTIONS are the right, but not the obligation, to buy or sell a specified amount
of securities or other assets on or before a fixed date at a predetermined
price. The Portfolios may purchase and write put and call options on securities,
securities indices and foreign currencies. A put option gives the holder the
right, upon payment of a premium, to deliver a specified amount of a security to
the writer of the option on or before a fixed date at a predetermined price. A
call option gives the holder the right, upon payment of a premium, to call upon
the writer to deliver a specified amount of a security on or before a fixed date
at a predetermined price.
FORWARD CONTRACTS are contracts to purchase or sell a specified amount of
property for an agreed upon price at a specified time. Forward contracts are not
currently exchange traded and are typically negotiated on an individual basis.
The Portfolios may enter into forward currency contracts to hedge against
declines in the value of non-dollar denominated securities or to reduce the
impact of currency appreciation on purchases of nondollar denominated
securities. They may also enter into forward contracts to purchase or sell
securities or other financial indices.
INTEREST RATE SWAPS involve the exchange by two parties of their respective
commitments to pay or receive interest (e.g., an exchange of floating rate
payments for fixed rate payments).
INTEREST RATE CAPS entitle the purchaser, to the extent that a specified index
exceeds a predetermined interest rate, to receive payments of interest on a
contractually based principal amount from the party selling the interest rate
cap.
INTEREST RATE FLOORS entitle the purchaser, to the extent that a specified index
falls below a predetermined interest rate, to receive payments of interest on a
contractually based principal amount from the party selling the interest rate
floor.
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IDEX AGGRESSIVE GROWTH PORTFOLIO
IDEX INTERNATIONAL EQUITY PORTFOLIO
IDEX CAPITAL APPRECIATION PORTFOLIO
IDEX GLOBAL PORTFOLIO
IDEX GROWTH PORTFOLIO
IDEX C.A.S.E. PORTFOLIO
IDEX VALUE EQUITY PORTFOLIO
IDEX ^ STRATEGIC TOTAL RETURN PORTFOLIO
IDEX TACTICAL ASSET ALLOCATION PORTFOLIO
IDEX BALANCED PORTFOLIO
IDEX FLEXIBLE INCOME PORTFOLIO
IDEX INCOME PLUS PORTFOLIO
IDEX TAX-EXEMPT PORTFOLIO
STATEMENT OF ADDITIONAL INFORMATION
FEBRUARY 1, 1997
IDEX SERIES FUND
(FORMERLY IDEX II SERIES FUND)
201 Highland Avenue
Largo, Florida 33770-2957
Customer Service (800) 851-9777
IDEX Aggressive Growth, International Equity, Capital Appreciation,
Global, Growth, C.A.S.E., Value Equity, ^ Strategic Total Return (formerly
Equity-Income), Tactical Asset Allocation, Balanced, Flexible Income, Income
Plus and Tax-Exempt Portfolios (each a "Portfolio" and collectively, the
"Portfolios") are series of IDEX Series Fund (the "Fund"), an open-end
management investment company that offers a selection of investment portfolios.
Each IDEX Portfolio herein was formerly known as an IDEX II Portfolio. All
Portfolios other than the Capital Appreciation Portfolio are diversified, while
the Capital Appreciation Portfolio is nondiversified. IDEX Aggressive Growth
Portfolio seeks long-term capital appreciation. IDEX International Equity
Portfolio seeks long-term growth of capital. IDEX Capital Appreciation Portfolio
seeks long-term growth of capital by emphasizing investments in common stocks of
companies by normally investing at least 50% of its equity assets in securities
issued by medium-sized companies as described in the Prospectus. IDEX Global
Portfolio seeks long-term growth of capital in a manner consistent with
preservation of capital, primarily through investments in common stocks of
foreign and domestic issuers. IDEX Growth Portfolio seeks only growth of
capital. IDEX C.A.S.E. Portfolio seeks annual growth of capital through
investments in companies whose management, financial resources and fundamentals
appear attractive on a scale measured against each company's present value. IDEX
Value Equity Portfolio seeks maximum consistent total return with minimum risk
to principal. IDEX ^ Strategic Total Return Portfolio seeks to provide current
income, long-term growth of income and capital appreciation. IDEX Tactical Asset
Allocation Portfolio seeks preservation of capital and competitive investment
returns. IDEX Balanced Portfolio seeks long-term capital growth, consistent with
preservation of capital and balanced by current income. IDEX Flexible Income
Portfolio seeks to obtain maximum total return for its shareholders, consistent
with preservation of capital, by actively managing a portfolio of
income-producing securities. IDEX Income Plus Portfolio seeks to provide as high
a level of current income as is consistent with the avoidance of excessive risk.
IDEX Tax-Exempt Portfolio seeks to provide maximum current interest income
exempt from federal income tax in a manner consistent with preservation of
capital.
On September 20, 1996 in a tax-free reorganization, IDEX Growth
Portfolio (formerly IDEX II Growth Portfolio) acquired all of the assets and
assumed all of the liabilities of IDEX Fund and IDEX Fund 3 in exchange for
Class T shares of IDEX Growth Portfolio, which were then distributed on a pro
rata basis to the respective shareholders of IDEX Fund and IDEX Fund 3. Upon the
closing of the reorganization, IDEX II Series Fund changed its name to IDEX
Series Fund.
This Statement of Additional Information is not a Prospectus, and
should be read in conjunction with the Prospectus dated February 1, 1997 which
may be obtained free of charge by writing or calling the Fund at the above
address or telephone number. This Statement of Additional Information contains
additional and more detailed information about each Portfolio's operations and
activities than that set forth in the Prospectus.
<PAGE>
IDEX SERIES FUND
STATEMENT OF ADDITIONAL INFORMATION
TABLE OF CONTENTS
INVESTMENT OBJECTIVES 1
INVESTMENT RESTRICTIONS, POLICIES AND PRACTICES 1
Investment Restrictions of IDEX Aggressive Growth Portfolio 1
Investment Restrictions of IDEX International Equity Portfolio 2
Investment Restrictions of IDEX Capital Appreciation Portfolio and
IDEX Balanced Portfolio 4
Investment Restrictions of IDEX Global Portfolio 5
Investment Restrictions of IDEX Growth Portfolio and
IDEX Flexible Income Portfolio 7
Investment Restrictions of IDEX C.A.S.E. Portfolio 8
Investment Restrictions of IDEX Value Equity Portfolio 10
Investment Restrictions of IDEX ^ Strategic Total Return Portfolio 11
Investment Restrictions of IDEX Tactical Asset Allocation Portfolio 12
Investment Restrictions of IDEX Income Plus Portfolio 14
Investment Restrictions of IDEX Tax-Exempt Portfolio 15
OTHER POLICIES AND PRACTICES OF THE PORTFOLIOS 17
Futures, Options and Other Derivative Instruments 17
Futures Contracts 17
Options on Futures Contracts 19
Options on Securities 20
Options on Foreign Currencies 23
Forward Contracts 24
Swaps and Swap-Related Products 25
Eurodollar Instruments 26
Special Investment Considerations and Risks 26
Additional Risks of Options on Foreign Currencies, Forward Contracts
and Foreign Instruments 27
Other Investment Companies 28
Zero Coupon, Pay-In-Kind and Step Coupon Securities 28
Income-Producing Securities 28
Lending of Portfolio Securities 29
Joint Trading Accounts 30
Illiquid Securities 30
Repurchase and Reverse Repurchase Agreements 30
Pass-through Securities 31
High-Yield/High-Risk Bonds 32
Warrants and Rights 32
U.S. Government Securities 32
Portfolio Turnover 33
INVESTMENT ADVISORY AND OTHER SERVICES 33
Additional Investment Advisory or Sub-Advisory Services
Provided by the Sub-Advisers 36
^
DISTRIBUTOR 38
ADMINISTRATIVE SERVICES 38
CUSTODIAN, TRANSFER AGENT AND OTHER AFFILIATES 39
PORTFOLIO TRANSACTIONS AND BROKERAGE 40
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TRUSTEES AND OFFICERS 42
PURCHASE OF SHARES 46
DISTRIBUTION PLANS 47
NET ASSET VALUE DETERMINATION 50
DIVIDENDS AND OTHER DISTRIBUTIONS 52
SHAREHOLDER ACCOUNTS 52
RETIREMENT PLANS 52
REDEMPTION OF SHARES 52
TAXES 53
PRINCIPAL SHAREHOLDERS 55
MISCELLANEOUS 55
Organization 55
Shares of Beneficial Interest 55
Legal Counsel and Auditors 56
Registration Statement 56
PERFORMANCE INFORMATION 56
FINANCIAL STATEMENTS 60
CERTAIN SECURITIES IN WHICH THE PORTFOLIOS MAY INVEST APPENDIX A
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INVESTMENT OBJECTIVES
The Prospectus discusses the investment objective of each Portfolio, the
types of securities in which each Portfolio will invest and the policies and
practices of each Portfolio. The following discussion of Investment
Restrictions, Policies and Practices supplements that set forth in the
Prospectus.
There can be no assurance that a Portfolio will, in fact, achieve its
objective. A Portfolio's investment objective may be changed by the Board of
Trustees without shareholder approval. A change in the investment objective of a
Portfolio may result in the Portfolio having an investment objective different
from that which the shareholder deemed appropriate at the time of investment. A
Portfolio will not change its objective without 30 days prior notice to its
shareholders nor will it charge shareholders an exchange fee or redemption fee
after such notice and prior to the expiration of such 30 day notice period.
However, should a shareholder decide to redeem Portfolio shares because of a
change in the objective, the shareholder may realize a taxable gain or loss.
INVESTMENT RESTRICTIONS, POLICIES AND PRACTICES
As indicated in the Prospectus, each Portfolio is subject to certain
fundamental policies and restrictions which as such may not be changed without
shareholder approval. Shareholder approval would be the approval by the lesser
of (i) more than 50% of the outstanding voting securities of a Portfolio, or
(ii) 67% or more of the voting securities present at a meeting if the holders of
more than 50% of the outstanding voting securities of a Portfolio are present or
represented by proxy.
INVESTMENT RESTRICTIONS OF IDEX AGGRESSIVE GROWTH PORTFOLIO
IDEX Aggressive Growth Portfolio may not, as a matter of fundamental policy:
1. With respect to 75% of the Portfolio's total assets, purchase the
securities of any one issuer (other than government securities as defined in the
Investment Company Act of 1940, as amended (the "1940 Act")), if immediately
after and as a result of such purchase (a) the value of the holdings of the
Portfolio in the securities of such issuer exceeds 5% of the value of the
Portfolio's total assets, or (b) the Portfolio owns more than 10% of the
outstanding voting securities of any one class of securities of such issuer;
2. Purchase any securities that would cause more than 25% of the value of
the Portfolio's total assets to be invested in the securities of issuers
conducting their principal business activities in the same industry; provided
that there shall be no limit on the purchase of U.S. government securities;
3. Purchase or sell real estate or real estate limited partnerships, except
that the Portfolio may purchase and sell securities secured by real estate,
mortgages or interests therein and securities that are issued by companies that
invest or deal in real estate;
4. Invest in commodities, except that the Portfolio may purchase or sell
stock index futures contracts and related options thereon if thereafter no more
than 5% of its total assets are invested in aggregate initial margin and
premiums;
5. Make loans to others, except through purchasing qualified debt
obligations, lending portfolio securities or entering into repurchase
agreements;
6. Act as an underwriter of securities issued by others, except to the
extent that it may be deemed an underwriter in connection with the disposition
of its portfolio securities;
7. Borrow money, except that the Portfolio may borrow from banks for
investment purposes as set forth in the Prospectus and may also engage in
reverse repurchase agreements. Immediately after any borrowing, including
reverse repurchase agreements, the Portfolio will maintain asset coverage of not
less than 300% with respect to all borrowings; and
8. Issue senior securities, except that the Portfolio may borrow from banks
for investment purposes so long as the Portfolio maintains the required
coverage.
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As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolio has adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees of the
Fund without shareholder approval:
(A) The Portfolio may not sell securities short or purchase securities on
margin, except that the Portfolio may obtain any short-term credit necessary for
the clearance of purchases and sales of securities. These restrictions shall not
apply to transactions involving selling securities "short against the box";
(B) The Portfolio may not pledge, hypothecate, mortgage or otherwise
encumber more than 15% of the value of the Portfolio's total assets except in
connection with borrowings described in ^ number 7 above. These restrictions
shall not apply to transactions involving reverse repurchase agreements or the
purchase of securities subject to firm commitment agreements or on a when-issued
basis;
(C) The Portfolio may not invest directly in oil, gas, or other mineral
development or exploration programs or leases; however, the Portfolio may own
debt or equity securities of companies engaged in those businesses;
(D) The Portfolio may not invest in securities of other investment
companies, except as it may be acquired as part of a merger, consolidation,
reorganization, acquisition of assets or offer of exchange;
(E) The Portfolio may not invest in companies for the purpose of exercising
control or management; and
(F) The Portfolio may not invest more than 15% of its net assets in
illiquid securities. This does not include securities eligible for resale
pursuant to Rule 144A under the Securities Act of 1933 (the "1933 Act"), or any
successor to such Rule, Section 4(2) commercial paper or any other securities as
to which the Board of Trustees has made a determination as to liquidity, as
permitted under the 1940 Act.
INVESTMENT RESTRICTIONS OF IDEX INTERNATIONAL EQUITY PORTFOLIO
IDEX International Equity Portfolio may not, as a matter of fundamental policy:
1. With respect to 75% of the Portfolio's total assets, purchase the
securities of any one issuer (other than government securities as defined in the
1940 Act) if immediately after and as a result of such purchase (a) the value of
the holdings of the Portfolio in the securities of such issuer exceeds 5% of the
value of the Portfolio's total assets, or (b) the Portfolio owns more than 10%
of the outstanding voting securities of any one class of securities of such
issuer. All securities of a foreign government and its agencies will be treated
as a single issuer for purposes of this restriction;
2. Invest 25% or more ^ of the value of the Portfolio's total assets in any
particular industry (other than U.S. government securities). For purposes of
this restriction, the term industry shall include (a) the government of any one
country other than the U.S., but not the U.S. government and (b) all
supranational organizations;
3. Purchase or sell physical commodities other than foreign currencies
unless acquired as a result of ownership of securities (but this restriction
shall not prevent the Portfolio from purchasing or selling options, futures
contracts, caps, floors and other derivative instruments, engaging in swap
transactions or investing in securities or other instruments backed by physical
commodities);
4. Invest directly in real estate or interests in real estate, including
limited partnership interests; however, the Portfolio may own securities or
other instruments backed by real estate, including mortgage-backed securities,
or debt or equity securities issued by companies engaged in those businesses;
5. Act as an underwriter of securities issued by others, except to the
extent that it may be deemed an underwriter in connection with the disposition
of portfolio securities of the Portfolio;
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<PAGE>
6. Lend any security or make any other loan if, as a result, more than 30%
of its total assets would be lent to other parties (but this limitation does not
apply to purchases of commercial paper, debt securities or to repurchase
agreements);
7. The Portfolio may borrow money only for temporary or emergency purposes
(not for leveraging or investment) in an amount not exceeding 331/3% of the
value of the Portfolio's total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that exceed 331/3% of the
value of the Portfolio's total assets by reason of a decline in net assets will
be reduced within three business days to the extent necessary to comply with the
331/3% limitation. This policy shall not prohibit reverse repurchase agreements
or deposits of assets to provide margin or guarantee positions in connection
with transactions in options, futures contracts, swaps, forward contracts, or
other derivative instruments or the segregation of assets in connection with
such transactions; and
8. Issue senior securities, except as permitted by the 1940 Act.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolio has adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees of the
Fund without shareholder approval:
(A) The Portfolio may not, as a matter of non-fundamental policy (i) enter
into any futures contracts or options on futures contracts for purposes other
than bona fide hedging transactions within the meaning of Commodity Futures
Trading Commission regulations if the aggregate initial margin deposits and
premiums required to establish positions in futures contracts and related
options that do not fall within the definition of bona fide hedging transactions
would exceed 5% of the fair market value of the Portfolio's net assets, after
taking into account unrealized profits and losses on such contracts it has
entered into and (ii) enter into any futures contracts or options on futures
contracts if the aggregate amount of the Portfolio's commitments under
outstanding futures contracts positions and options on futures contracts would
exceed the market value of its total assets;
(B) The Portfolio may not mortgage or pledge any securities owned or held
by the Portfolio in amounts that exceed, in the aggregate, 15% of the
Portfolio's net assets, provided that this limitation does not apply to reverse
repurchase agreements or in the case of assets deposited to provide margin or
guarantee positions in options, futures contracts, swaps, forward contracts or
other derivative instruments or the segregation of assets in connection with
such transactions;
(C) The Portfolio may not sell securities short, unless it owns or has the
right to obtain securities equivalent in kind and amount to the securities sold
short, and provided that transactions in options, futures contracts, swaps,
forward contracts and other derivative instruments are not deemed to constitute
selling securities short;
(D) The Portfolio may not purchase securities on margin, except that the
Portfolio may obtain such short-term credits as are necessary for the clearance
of transactions, and provided that margin payments and other deposits made in
connection with transactions in options, futures contracts, swaps, forward
contracts, and other derivative instruments shall not be deemed to constitute
purchasing securities on margin;
(E) The Portfolio may not invest more than 15% of its net assets in
illiquid securities. This does not include securities eligible for resale
pursuant to Rule 144A under the 1933 Act, or any successor to such Rule, Section
4(2) commercial paper or other securities for which the Board of Trustees has
made a determination of liquidity, as permitted under the 1940 Act;
(F) The Portfolio may not purchase securities of other investment
companies, except a security acquired as a result of reorganization,
consolidation, or merger, acquisition or offer of exchange and except as
otherwise permitted under the 1940 Act. Investments by the Portfolio in the GEI
Short-Term Investment Fund, an investment fund advised by GE Investment
Management ^ Incorporated ("GEIM"), created specifically to serve as a vehicle
for the collective investment of cash balances of the Portfolio and other
accounts advised by GEIM or General Electric Investment Corporation, is not
considered an investment in another investment company for the purposes of this
restriction;
(G) The Portfolio may not invest directly in oil, gas or other mineral
development or exploration programs or leases; however, the Portfolio may own
debt or equity securities of companies engaged in those businesses; and
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(H) The Portfolio may not invest in companies for the purpose of exercising
control or management.
With respect to investment restriction No. 2 above, the Portfolio may use
the industry classifications reflected by the S&P 500 Composite Stock Index, if
applicable at the time of determination. For all other Portfolio holdings the
Portfolio may use the Directory of Companies Required to File Annual Reports
with the SEC and Bloomberg, Inc. In addition, the Portfolio may select its own
industry classifications, provided such classifications are reasonable.
INVESTMENT RESTRICTIONS OF IDEX CAPITAL APPRECIATION PORTFOLIO AND IDEX BALANCED
PORTFOLIO
IDEX Capital Appreciation Portfolio and IDEX Balanced Portfolio may not, as a
matter of fundamental policy:
1. With respect to 75% of its total assets in the case of the Balanced
Portfolio and 50% of its total assets in the case of the Capital Appreciation
Portfolio, purchase the securities of any one issuer (except cash items and
"government securities" as defined under the 1940 Act, if immediately after and
as a result of such purchase the value of the holdings of the Portfolio in the
securities of such issuer exceeds 5% of the value of such Portfolio's total
assets or the Portfolio owns more than 10% of the outstanding voting securities
of such issuer. With respect to the remaining 50% of the value of its total
assets, IDEX Capital Appreciation Portfolio may invest in the securities of as
few as two issuers;
2. Invest more than 25% of the value of its assets in any particular
industry (other than U.S. government securities);
3. Invest directly in real estate or interests in real estate; however, a
Portfolio may own debt or equity securities issued by companies engaged in those
businesses;
4. Purchase or sell physical commodities other than foreign currencies
unless acquired as a result of ownership of securities (but this limitation
shall not prevent a Portfolio from purchasing or selling options, futures, swaps
and forward contracts or from investing in securities or other instruments
backed by physical commodities);
5. Lend any security or make any other loan if, as a result, more than 25%
of its total assets would be lent to other parties (but this limitation does not
apply to purchases of commercial paper, debt securities or repurchase
agreements);
6. Act as underwriter of securities issued by others, except to the extent
that a Portfolio may be deemed an underwriter in connection with the disposition
of portfolio securities of that Portfolio; and
7. The Portfolio may borrow money for temporary or emergency purposes (not
for leveraging or investment) in an amount not exceeding 25% of the value of the
Portfolio's total assets (including the amount borrowed) less liabilities (other
than borrowings). If borrowings exceed 25% of the value of the Portfolio's total
assets by reason of a decline in net assets, the Portfolio will reduce its
borrowings within three business days to the extent necessary to comply with the
25% limitation. This policy shall not prohibit reverse repurchase agreements, or
deposits of assets to margin or guarantee positions in futures, options, swaps
or forward contracts, and the segregation of assets in connection with such
contracts.
8. Issue senior securities, except as permitted by the 1940 Act.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolios have adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees without
shareholder approval:
(A) The Portfolio may not: (i) enter into any futures contracts and related
options for purposes other than bona fide hedging transactions within the
meaning of Commodity Futures Trading Commission ("CFTC") regulations if the
aggregate initial margin and premiums required to establish positions in futures
contracts and related options that do not fall within the definition of bona
fide hedging transactions will exceed 5% of the fair market value of a
Portfolio's net assets, after taking into account unrealized profits and
unrealized losses on any such contracts it has entered into; and (ii) enter into
any futures contracts if the aggregate amount of such Portfolio's commitments
under outstanding futures contracts positions of that Portfolio would exceed the
market value of its total assets;
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<PAGE>
(B) The Portfolio may not sell securities short, unless it owns or has the
right to obtain securities equivalent in kind and amount to the securities sold
short without the payment of any additional consideration therefore, and
provided that transactions in futures, options, swaps and forward contracts are
not deemed to constitute selling securities short;
(C) The Portfolio may not purchase securities on margin, except that the
Portfolio may obtain such short-term credits as are necessary for the clearance
of transactions, and provided that margin payments and other deposits in
connection with transactions in futures, options, contracts, swaps, and forward
contracts, shall not be deemed to constitute purchasing securities on margin;
(D) The Portfolio may not (i) purchase securities of other investment
companies, except in the open market where no commission except the ordinary
broker's commission is paid, or (ii), purchase or retain securities issued by
other open-end investment companies. Limitations (i) and (ii) do not apply to
money market funds or to securities received as dividends, through offers of
exchange, or as a result of a reorganization, consolidation, or merger. If the
Portfolio invests in a money market fund, the investment adviser will reduce its
advisory fees by the amount of any investment advisory and administrative
services fees paid to the investment manager of the money market fund;
(E) The Portfolio may not mortgage or pledge any securities owned or held
by the Portfolio in amounts that exceed, in the aggregate, 15% of that
Portfolio's net asset value, provided that this limitation does not apply to
reverse repurchase agreements, deposits of assets to margin, guarantee positions
in futures, options, swaps or forward contracts or segregation of assets in
connection with such contracts;
(F) The Portfolio may not invest directly in oil, gas or other mineral
development or exploration programs or leases; however, the Portfolio may own
debt or equity securities of companies engaged in those businesses;
(G) The Portfolio may not purchase any security or enter into a repurchase
agreement, if as a result, more than 15% of its net assets would be invested in
repurchase agreements not entitling the holder to payment of principal and
interest within seven days and in securities that are illiquid by virtue of
legal or contractual restrictions on resale or the absence of a readily
available market. The Trustees, or the Portfolio's investment adviser or
sub-adviser acting pursuant to authority delegated by the Trustees, may
determine that a readily available market exists for securities eligible for
resale pursuant to Rule 144A under the 1933 Act, or any successor to such Rule,
Section 4(2) commercial paper and municipal lease obligations. Accordingly, such
securities may not be subject to the foregoing limitation;
(H) The Portfolio may not invest in companies for the purpose of exercising
control or management; and
(I) With respect to the Balanced Portfolio only, at least 25% of the total
assets of that Portfolio will normally be invested in fixed-income senior
securities, which include corporate debt securities and preferred stock.
INVESTMENT RESTRICTIONS OF IDEX GLOBAL PORTFOLIO
IDEX Global Portfolio may not, as a matter of fundamental policy:
1. Own more than 10% of the outstanding voting securities of any one issuer
and, as to seventy-five percent (75%) of the value of its total assets, purchase
the securities of any one issuer (except cash items and "government securities"
as defined under the 1940 Act, if immediately after and as a result of such
purchase, the value of the holdings of the Portfolio in the securities of such
issuer exceeds 5% of the value of the Portfolio's total assets;
2. Invest more than 25% of the value of its assets in any particular
industry (other than government securities);
3. Invest directly in real estate or interests in real estate; however, the
Portfolio may own debt or equity securities issued by companies engaged in those
businesses;
4. Purchase or sell physical commodities other than foreign currencies
unless acquired as a result of ownership of securities (but this shall not
prevent the Portfolio from purchasing or selling options, futures, swaps and
forward contracts or from investing in securities or other instruments backed by
physical commodities);
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5. Lend any security or make any other loan if, as a result, more than 25%
of its total assets would be lent to other parties (but this limitation does not
apply to purchases of commercial paper, debt securities or to repurchase
agreements);
6. Act as an underwriter of securities issued by others, except to the
extent that it may be deemed an underwriter in connection with the disposition
of its portfolio securities; and
7. The Portfolio may borrow money only for temporary or emergency purposes
(not for leveraging or investment) in an amount not exceeding 25% of the value
of the Portfolio's total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that exceed 25% of the value of the
Portfolio's total assets by reason of a decline in net assets will be reduced
within three business days to the extent necessary to comply with the 25%
limitation. This policy shall not prohibit reverse repurchase agreements or
deposits of assets to margin or guarantee positions in futures, options, swaps
or forward contracts, or the segregation of assets in connection with such
contacts.
8. Issue senior securities, except as permitted by the 1940 Act.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolio has adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees without
shareholder approval:
(A) The Portfolio may not (i) enter into any futures contracts or options
on futures contracts for purposes other than bona fide hedging transactions
within the meaning of Commodity Futures Commission regulations if the aggregate
initial margin deposits and premiums required to establish positions in futures
contracts and related options that do not fall within the definition of bona
fide hedging transactions would exceed 5% of the fair market value of the
Portfolio's net assets, after taking into account unrealized profits and losses
on such contracts it has entered into; and (ii) enter into any futures contracts
or options on futures contracts if the aggregate amount of the Portfolio's
commitments under outstanding futures contracts positions and options on futures
contracts would exceed the market value of its total assets;
(B) The Portfolio may not sell securities short, unless it owns or has the
right, without the payment of any additional compensation, to obtain securities
equivalent in kind and amount to the securities sold short, and provided that
transactions in options, swaps and forward futures contracts are not deemed to
constitute selling securities short;
(C) The Portfolio may not purchase securities on margin, except that the
Portfolio may obtain such short-term credits as are necessary for the clearance
of transactions, and provided that margin payments and other deposits in
connection with transactions in options, futures, swaps and forward contracts
shall not be deemed to constitute purchasing securities on margin;
(D) The Portfolio may not (i) purchase securities of other investment
companies, except in the open market where no commission except the ordinary
broker's commission is paid, or (ii) purchase or retain securities issued by
other open-end investment companies. Limitations (i) and (ii) do not apply to
money market funds or to securities received as dividends, through offers of
exchange, or as a result of a consolidation, merger or other reorganization;
(E) The Portfolio may not mortgage or pledge any securities owned or held
by the Portfolio in amounts that exceed, in the aggregate, 15% of the
Portfolio's net assets, provided that this limitation does not apply to reverse
repurchase agreements or in the case of assets deposited to provide margin or
guarantee positions in options, futures contracts, swaps, forward contracts or
other derivative instruments or the segregation of assets in connection with
such transactions;
(F) The Portfolio may not invest directly in oil, gas or other mineral
development or exploration programs or leases; however, the Portfolio may own
debt or equity securities of companies engaged in those businesses;
(G) The Portfolio may not invest more than 15% of its net assets in
illiquid securities. This does not include securities eligible for resale
pursuant to Rule 144A under the 1933 Act, or any successor to such Rule, Section
4(2) commercial paper or any other securities as to which the Board of Trustees
have made a determination as to liquidity, as permitted under the 1940 Act; and
6
<PAGE>
(H) The Portfolio may not invest in companies for the purpose of exercising
control or management.
INVESTMENT RESTRICTIONS OF IDEX GROWTH PORTFOLIO AND IDEX FLEXIBLE INCOME
PORTFOLIO
IDEX Growth Portfolio and IDEX Flexible Income Portfolio may not, as a matter of
fundamental policy:
1. With respect to 75% of the Portfolio's total assets, purchase the
securities of any one issuer (other than cash items and "government securities"
as defined under the 1940 Act, if immediately after and as a result of such
purchase (a) the value of the holdings of the Portfolio in the securities of
such issuer exceeds 5% of the value of the Portfolio's total assets, or (b) the
Portfolio owns more than 10% of the outstanding voting securities of such
issuer;
2. Invest more than 25% of the value of its assets in any particular
industry (other than government securities);
3. Purchase or sell physical commodities other than foreign currencies
unless acquired as a result of ownership of securities (but this restriction
shall not prevent the Portfolio from purchasing or selling options, futures
contracts, caps, floors and other derivative instruments, engaging in swap
transactions or investing in securities or other instruments backed by physical
commodities);
4. Invest directly in real estate or interests in real estate, including
limited partnership interests; however, the Portfolio may own debt or equity
securities issued by companies engaged in those businesses;
5. Act as underwriter of securities issued by others, except to the extent
that it may be deemed an underwriter in connection with the disposition of
portfolio securities of the Portfolio;
6. Lend any security or make any other loan if, as a result, more than 25%
of its total assets would be lent to other parties (but this limitation does not
apply to purchases of commercial paper, debt securities or to repurchase
agreements); and
7. The Portfolio may borrow money only for temporary or emergency purposes
(not for leveraging or investment) in an amount not exceeding 25% of the value
of the Portfolio's total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that exceed 25% of the value of the
Portfolio's total assets by reason of a decline in net assets will be reduced
within three business days to the extent necessary to comply with the 25%
limitation. This policy shall not prohibit reverse repurchase agreements or
deposits of assets to provide margin or guarantee positions in connection with
transactions in options, futures contracts, swaps, forward contracts, and other
derivative instruments or the segregation of assets in connection with such
transactions.
8. Issue senior securities, except as permitted by the 1940 Act.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolios have adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees without
shareholder approval:
(A) The Portfolio may not: (i) enter into any futures contracts or options
on futures contracts for purposes other than bona fide hedging transactions
within the meaning of Commodity Futures Commission regulations if the aggregate
initial margin deposits and premiums required to establish positions in futures
contracts and related options that do not fall within the definition of bona
fide hedging transactions would exceed 5% of the fair market value of the
Portfolio's net assets, after taking into account unrealized profits and losses
on such contracts it has entered into; and (ii) enter into any futures contracts
or options on futures contracts if the aggregate amount of the Portfolio's
commitments under outstanding futures contracts positions and options on futures
contracts would exceed the market value of its total assets;
(B) The Portfolio may not mortgage or pledge any securities owned or held
by the Portfolio in amounts that exceed, in the aggregate, 15% of the
Portfolio's net assets, provided that this limitation does not apply to reverse
repurchase agreements or in the case of assets deposited to provide margin or
guarantee positions in options, futures contracts, swaps, forward contracts or
other derivative instruments or the segregation of assets in connection with
such transactions;
7
<PAGE>
(C) The Portfolio may not sell securities short, unless it owns or has the
right to obtain securities equivalent in kind and amount to the securities sold
short, and provided that transactions in options, futures contracts, swaps,
forward contracts, and other derivative instruments are not deemed to constitute
selling securities short;
(D) The Portfolio may not purchase securities on margin, except that the
Portfolio may obtain such short-term credits as are necessary for the clearance
of transactions, and provided that margin payments and other deposits made in
connection with transactions in options, futures contracts, swaps, forward
contracts, and other derivative instruments shall not be deemed to constitute
purchasing securities on margin;
(E) The Portfolio may not invest more than 15% of its net assets in
illiquid securities. This does not include securities eligible for resale
pursuant to Rule 144A under the 1933 Act, or any successor to such Rule, Section
4(2) commercial paper or any securities which the Board of Trustees or the
investment sub-adviser, as appropriate, has made a determination of liquidity,
as permitted under the 1940 Act;
(F) The Portfolio may not invest in companies for the purpose of exercising
control or management;
(G) The Portfolio may not (i) purchase securities of other investment
companies except in the open market where no commission except the ordinary
broker's commission is paid, or (ii) purchase or retain securities issued by
other open-end investment companies. Restrictions (i) and (ii) do not apply to
money market funds or to securities received as dividends, through offers to
exchange, or as a result of reorganization, consolidation, or merger. If the
Portfolio invests in a money market fund, the investment advisers will reduce
their advisory fees by the amount of any investment advisory or administrative
service fees paid to the investment manager of the money market fund; and
(H) The Portfolio may not invest directly in oil, gas or other mineral
development or exploration programs or leases; however, the Portfolio may own
debt or equity securities of companies engaged in those businesses.
In making all investments for the IDEX Flexible Income Portfolio, the
sub-adviser will emphasize economic or financial factors or circumstances of the
issuer, rather than opportunities for short-term arbitrage.
INVESTMENT RESTRICTIONS OF IDEX C.A.S.E. PORTFOLIO
IDEX C.A.S.E. Portfolio may not, as a matter of fundamental policy:
1. With respect to 75% of the Portfolio's total assets, purchase the
securities of any one issuer (other than cash items and "government securities"
as defined in the 1940 Act) if immediately after and as a result of such
purchase (a) the value of the holdings of the Portfolio in the securities of
such issuer exceeds 5% of the value of the Portfolio's total assets, or (b) the
Portfolio owns more than 10% of the outstanding voting securities of any one
class of securities of such issuer.
2. Invest 25% or more of the value of the Portfolio's assets in any
particular industry (other than government securities);
3. Purchase or sell physical commodities other than foreign currencies
unless acquired as a result of ownership of securities (but this restriction
shall not prevent the Portfolio from purchasing or selling options, futures
contracts, caps, floors and other derivative instruments, engaging in swap
transactions or investing in securities or other instruments backed by physical
commodities);
4. Invest directly in real estate or interests in real estate, including
limited partnership interests; however, the Portfolio may own debt or equity
securities issued by companies engaged in those businesses;
5. Act as an underwriter of securities issued by others, except to the
extent that it may be deemed an underwriter in connection with the disposition
of portfolio securities of the Portfolio;
6. Lend any security or make any other loan if, as a result, more than 25%
of its total assets would be lent to other parties (but this limitation does not
apply to purchases of commercial paper, debt securities or to repurchase
agreements);
8
<PAGE>
7. The Portfolio may borrow money only for temporary or emergency purposes
(not for leveraging or investment) in an amount not exceeding 25% of the value
of the Portfolio's total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that exceed 25% of the value of the
Portfolio's total assets by reason of a decline in net assets will be reduced
within three business days to the extent necessary to comply with the 25%
limitation. This policy shall not prohibit reverse repurchase agreements or
deposits of assets to provide margin or guarantee positions in connection with
transactions in options, futures contracts, swaps, forward contracts, or other
derivative instruments or the segregation of assets in connection with such
transactions; and
8. Issue senior securities, except as permitted by the 1940 Act.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolio has adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees of the
Fund without shareholder approval:
(A) The Portfolio may not, as a matter of non-fundamental policy (i) enter
into any futures contracts or options on futures contracts for purposes other
than bona fide hedging transactions within the meaning of Commodity Futures
Commission regulations if the aggregate initial margin deposits and premiums
required to establish positions in futures contracts and related options that do
not fall within the definition of bona fide hedging transactions would exceed 5%
of the fair market value of the Portfolio's net assets, after taking into
account unrealized profits and losses on such contracts it has entered into and
(ii) enter into any futures contracts or options on futures contracts if the
aggregate amount of the Portfolio's commitments under outstanding futures
contracts positions and options on futures contracts would exceed the market
value of its total assets;
(B) The Portfolio may not mortgage or pledge any securities owned or held
by the Portfolio in amounts that exceed, in the aggregate, 15% of the
Portfolio's net assets, provided that this limitation does not apply to reverse
repurchase agreements or in the case of assets deposited to provide margin or
guarantee positions in options, futures contracts, swaps, forward contracts or
other derivative instruments or the segregation of assets in connection with
such transactions;
(C) The Portfolio may not sell securities short, unless it owns or has the
right to obtain securities equivalent in kind and amount to the securities sold
short, and provided that transactions in options, futures contracts, swaps,
forward contracts and other derivative instruments are not deemed to constitute
selling securities short;
(D) The Portfolio may not purchase securities on margin, except that the
Portfolio may obtain such short-term credits as are necessary for the clearance
of transactions, and provided that margin payments and other deposits made in
connection with transactions in options, futures contracts, swaps, forward
contracts, and other derivative instruments shall not be deemed to constitute
purchasing securities on margin;
(E) The Portfolio may not invest more than 15% of its net assets in
illiquid securities. This does not include securities eligible for resale
pursuant to Rule 144A under the 1933 Act, or any successor to such Rule, Section
4(2) commercial paper or other securities for which the Board of Trustees has
made a determination of liquidity, as permitted under the 1940 Act;
(F) The Portfolio may not (i) purchase securities of other investment
companies, except in the open market where no commission except the ordinary
broker's commission is paid, or (ii) purchase or retain securities issued by
other open-end investment companies. Restrictions (i) and (ii) do not apply to
money market funds or to securities received as dividends, through offers to
exchange, or as a result of reorganization, consolidation, or merger. If the
Portfolio invests in a money market fund, the investment adviser will reduce its
advisory fee by the amount of any investment advisory or administrative service
fees paid to the investment manager of the money market fund;
(G) The Portfolio may not invest directly in oil, gas or other mineral
development or exploration programs or leases; however, the Portfolio may own
debt or equity securities of companies engaged in those businesses;
(H) The Portfolio may not invest more than 25% of its net assets at the
time of purchase in the securities of foreign issuers and obligors; and
9
<PAGE>
(I) The Portfolio may not invest in companies for the purpose of exercising
control or management.
INVESTMENT RESTRICTIONS OF IDEX VALUE EQUITY PORTFOLIO
IDEX Value Equity Portfolio may not, as a matter of fundamental policy:
1. With respect to 75% of the Portfolio's total assets, purchase the
securities of any one issuer (other than government securities as defined in the
1940 Act) if immediately after and as a result of such purchase (a) the value of
the holdings of the Portfolio in the securities of such issuer exceeds 5% of the
value of the Portfolio's total assets, or (b) the Portfolio owns more than 10%
of the outstanding voting securities of any one class of securities of such
issuer;
2. Invest 25% or more ^ of the value of the Portfolio's total assets in any
particular industry (other than U.S. government securities);
3. Purchase or sell physical commodities other than foreign currencies
unless acquired as a result of ownership of securities (but this restriction
shall not prevent the Portfolio from purchasing or selling options, futures
contracts, caps, floors and other derivative instruments, engaging in swap
transactions or investing in securities or other instruments backed by physical
commodities);
4. Invest directly in real estate or interests in real estate, including
limited partnership interests; however, the Portfolio may own debt or equity
securities issued by companies engaged in those businesses;
5. Act as an underwriter of securities issued by others, except to the
extent that it may be deemed an underwriter in connection with the disposition
of portfolio securities of the Portfolio;
6. Lend any security or make any other loan if, as a result, more than 25%
of its total assets would be lent to other parties (but this limitation does not
apply to purchases of commercial paper, debt securities or to repurchase
agreements);
7. The Portfolio may borrow money only for temporary or emergency purposes
(not for leveraging or investment) in an amount not exceeding 10% of the value
of the Portfolio's total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that exceed 10% of the value of the
Portfolio's total assets by reason of a decline in net assets will be reduced
within three business days to the extent necessary to comply with the 10%
limitation. The Portfolio may not purchase additional securities when borrowings
exceed 5% of total assets. This policy shall not prohibit reverse repurchase
agreements or deposits of assets to provide margin or guarantee positions in
connection with transactions in options, futures contracts, swaps, forward
contracts, or other derivative instruments or the segregation of assets in
connection with such transactions; and
8. Issue senior securities, except as permitted by the 1940 Act.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolio has adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees of the
Fund without shareholder approval:
(A) The Portfolio may not, as a matter of non-fundamental policy (i) enter
into any futures contracts or options on futures contracts for purposes other
than bona fide hedging transactions within the meaning of Commodity Futures
Commission regulations if the aggregate initial margin deposits and premiums
required to establish positions in futures contracts and related options that do
not fall within the definition of bona fide hedging transactions would exceed 5%
of the fair market value of the Portfolio's net assets, after taking into
account unrealized profits and losses on such contracts it has entered into and
(ii) enter into any futures contracts or options on futures contracts if the
aggregate amount of the Portfolio's commitments under outstanding futures
contracts positions and options on futures contracts would exceed the market
value of its total assets;
(B) The Portfolio may not mortgage or pledge any securities owned or held
by the Portfolio in amounts that exceed, in the aggregate, 15% of the
Portfolio's net assets, provided that this limitation does not apply to reverse
repurchase agreements or in
10
<PAGE>
the case of assets deposited to provide margin or guarantee positions in
options, futures contracts, swaps, forward contracts or other derivative
instruments or the segregation of assets in connection with such transactions;
(C) The Portfolio may not sell securities short, unless it owns or has the
right to obtain securities equivalent in kind and amount to the securities sold
short, and provided that transactions in options, futures contracts, swaps,
forward contracts and other derivative instruments are not deemed to constitute
selling securities short;
(D) The Portfolio may not purchase securities on margin, except that the
Portfolio may obtain such short-term credits as are necessary for the clearance
of transactions, and provided that margin payments and other deposits made in
connection with transactions in options, futures contracts, swaps, forward
contracts, and other derivative instruments shall not be deemed to constitute
purchasing securities on margin;
(E) The Portfolio may not invest more than 15% of its net assets in
illiquid securities. This does not include securities eligible for resale
pursuant to Rule 144A under the 1933 Act, or any successor to such Rule, Section
4(2) commercial paper or other securities for which the Board of Trustees has
made a determination of liquidity, as permitted under the 1940 Act;
(F) The Portfolio may not (i) purchase securities of other investment
companies, except in the open market where no commission except the ordinary
broker's commission is paid, or (ii) purchase or retain securities issued by
other open-end investment companies. Restrictions (i) and (ii) do not apply to
money market funds or to securities received as dividends, through offers to
exchange, or as a result of reorganization, consolidation, or merger. If the
Portfolio invests in a money market fund, the investment adviser will reduce its
advisory fee by the amount of any investment advisory or administrative service
fees paid to the investment manager of the money market fund;
(G) The Portfolio may not invest directly in oil, gas or other mineral
development or exploration programs or leases; however, the Portfolio may own
debt or equity securities of companies engaged in those businesses;
(H) The Portfolio may not invest more than 25% of its net assets at the
time of purchase in the securities of foreign issuers and obligors; and
(I) The Portfolio may not invest in companies for the purpose of exercising
control or management.
INVESTMENT RESTRICTIONS OF IDEX ^ STRATEGIC TOTAL RETURN PORTFOLIO
IDEX ^ Strategic Total Return Portfolio may not, as a matter of fundamental
policy:
1. With respect to 75% of the Portfolio's total assets, purchase the
securities of any one issuer (other than government securities as defined in the
1940 Act) if immediately after and as a result of such purchase (a) the value of
the holdings of the Portfolio in the securities of such issuer exceeds 5% of the
value of the Portfolio's total assets, or (b) the Portfolio owns more than 10%
of the outstanding voting securities of such issuer;
2. Invest more than 25% of the Portfolio's assets in the securities of
issuers primarily engaged in the same industry. Utilities will be divided
according to their services, for example, gas, gas transmission, electric and
telephone, and each will be considered a separate industry for purposes of this
restriction. In addition, there shall be no limitation on the purchase of
obligations issued or guaranteed by the U.S. government or its agencies or
instrumentalities, or of certificates of deposit and bankers' acceptances;
3. Purchase or sell real estate (but this shall not prevent the Portfolio
from investing in securities or other instruments backed by real estate,
including mortgage-backed securities, or securities of companies engaged in the
real estate business);
4. Purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments (but this shall not prevent the
Portfolio from investing in securities or other instruments backed by physical
commodities);
5. Lend any security or make any other loan if, as a result, more than 25%
of its total assets would be lent to other parties (but this limitation does not
apply to purchases of commercial paper or debt securities);
11
<PAGE>
6. Act as an underwriter of securities issued by others, except to the
extent that it may be deemed an underwriter in connection with the disposition
of its portfolio securities;
7. The Portfolio may borrow money only for temporary or emergency purposes
(not for leveraging or investment) in an amount not exceeding 25% of the value
of the Portfolio's total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that exceed 25% of the value of the
Portfolio's total assets by reason of a decline in net assets will be reduced
within three business days to the extent necessary to comply with the 25%
limitation; and
8. Issue senior securities, except as permitted by the 1940 Act.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolio has adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees of the
Fund without shareholder approval:
(A) The Portfolio may not mortgage or pledge any securities owned or held
by the Portfolio in amounts that exceed, in the aggregate, 15% of the
Portfolio's net assets, provided that this limitation does not apply in the case
of assets deposited to margin or guarantee positions in options, futures
contracts and options on futures contracts or placed in a segregated account in
connection with such contracts;
(B) The Portfolio may not sell securities short, unless it owns or has the
right to obtain securities equivalent in kind and amount to the securities sold
short, and provided that margin payments and other deposits in connection with
transactions in options, swaps and forward futures contracts are not deemed to
constitute selling securities short;
(C) The Portfolio may not purchase securities on margin, except that the
Portfolio may obtain such short-term credits as are necessary for the clearance
of transactions, and provided that margin payments and other deposits in
connection with transactions in options, futures, swaps and forward contracts
shall not be deemed to constitute purchasing securities on margin;
(D) The Portfolio may not (i) purchase securities of other investment
companies, except in the open market where no commission except the ordinary
broker's commission is paid, or (ii) purchase or retain securities issued by
other open-end investment companies. Limitations (i) and (ii) do not apply to
money market funds or to securities received as dividends, through offers of
exchange, or as a result of a consolidation, merger or other reorganization;
(E) The Portfolio may not invest directly in oil, gas, or other mineral
development or exploration programs or leases; however, the Portfolio may own
debt or equity securities of companies engaged in those businesses;
(F) The Portfolio may not invest more than 15% of its net assets in
illiquid securities. This does not include securities eligible for resale
pursuant to Rule 144A under the 1933 Act, or any successor to such Rule, Section
4(2) commercial paper or any other securities as to which the Board of Trustees
has made a determination as to liquidity, as permitted under the 1940 Act;
(G) The Portfolio may not invest in companies for the purpose of exercising
control or management; and
(H) The Portfolio may not invest in securities of foreign issuers
denominated in foreign currency and not publicly traded in the United States if
at the time of acquisition more than 10% of the Portfolio's total assets would
be invested in such securities.
INVESTMENT RESTRICTIONS OF IDEX TACTICAL ASSET ALLOCATION PORTFOLIO
IDEX Tactical Asset Allocation Portfolio may not, as a matter of fundamental
policy:
1. With respect to 75% of the Portfolio's total assets, purchase the
securities of any one issuer (other than government securities as defined in the
1940 Act) if immediately after and as a result of such purchase (a) the value of
the holdings of the Portfolio in the securities of such issuer exceeds 5% of the
value of the Portfolio's total assets, or (b) the Portfolio owns more than 10%
of the outstanding voting securities of such issuer;
12
<PAGE>
2. Invest more than 25% of the Portfolio's assets in the securities of
issuers primarily engaged in the same industry. Utilities will be divided
according to their services, for example, gas, gas transmission, electric and
telephone, and each will be considered a separate industry for purposes of this
restriction. In addition, there shall be no limitation on the purchase of
obligations issued or guaranteed by the U.S. government or its agencies or
instrumentalities, or of certificates of deposit and bankers acceptances;
3. Purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments (but this limitation shall not
prevent the Portfolio from investing in securities or other instruments backed
by physical commodities);
4. Purchase or sell real estate (but this shall not prevent the Portfolio
from investing in securities or other instruments backed by real estate,
including mortgage-backed securities, or securities of companies engaged in the
real estate business);
5. Lend any security or make any other loan if, as a result, more than 25%
of its total assets would be lent to other parties (but this limitation does not
apply to purchases of commercial paper or debt securities);
6. Act as an underwriter of securities issued by others, except to the
extent that it may be deemed an underwriter in connection with the disposition
of its portfolio securities;
7. The Portfolio may borrow money only for temporary or emergency purposes
(not for leveraging or investment) in an amount not exceeding 25% of the value
of the Portfolio's total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that exceed 25% of the value of the
Portfolio's total assets by reason of a decline in net assets will be reduced
within three business days to the extent necessary to comply with the 25%
limitation; and
8. Issue senior securities, except as permitted by the 1940 Act.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolio has adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees of the
Fund without shareholder approval:
(A) The Portfolio may not sell securities short, unless it owns or has the
right to obtain securities equivalent in kind and amount to the securities sold
short, and provided that margin payments and other deposits in connection with
transactions in options, swaps and forward and futures contracts are not deemed
to constitute selling securities short;
(B) The Portfolio may not purchase securities on margin, except that the
Portfolio may obtain such short-term credits as are necessary for the clearance
of transactions, and provided that margin payments and other deposits in
connection with transactions in options, futures, swaps and forward contracts
shall not be deemed to constitute purchasing securities on margin;
(C) The Portfolio may not (i) purchase securities of other investment
companies, except in the open market where no commission except the ordinary
broker's commission is paid, or (ii) purchase or retain securities issued by
other open-end investment companies. Limitations (i) and (ii) do not apply to
money market funds or to securities received as dividends, through offers of
exchange, or as a result of a consolidation, merger or other reorganization;
(D) The Portfolio may not mortgage or pledge any securities owned or held
by the Portfolio in amounts that exceed, in the aggregate, 15% of the
Portfolio's net assets, provided that this limitation does not apply to reverse
repurchase agreements, deposits of assets to margin, guarantee positions in
futures, options, swaps or forward contracts or segregation of assets in
connection with such contracts;
(E) The Portfolio may not invest directly in oil, gas, or other mineral
development or exploration programs or leases; however, the Portfolio may own
debt or equity securities of companies engaged in those businesses;
(F) The Portfolio may not invest in companies for the purpose of exercising
control or management; and
13
<PAGE>
(G) The Portfolio may not invest more than 15% of its net assets in
illiquid securities. This does not include securities eligible for resale
pursuant to Rule 144A under the 1933 Act, or any successor to such Rule, Section
4(2) commercial paper or any other securities as to which the Board of Trustees
has made a determination as to liquidity, as permitted under the 1940 Act.
INVESTMENT RESTRICTIONS OF IDEX INCOME PLUS PORTFOLIO
IDEX Income Plus Portfolio may not, as a matter of fundamental policy:
1. Borrow money, except from a bank for temporary or emergency purposes
(not for leveraging or investment) in an amount not to exceed 1/3 of the current
value of the Portfolio's total assets (including the amount borrowed) less
liabilities (not including the amount borrowed) at the time the borrowing is
made. If at any time the Portfolio's borrowings exceed this limitation due to a
decline in net assets, such borrowings will be reduced within 3 business days to
the extent necessary to comply with the limitation. The Portfolio will borrow
only to facilitate redemptions requested by shareholders which might otherwise
require untimely disposition of portfolio securities and will not purchase
securities while borrowings are outstanding;
2. Pledge assets, except that the Portfolio may pledge not more than 1/3 of
its total assets (taken at current value) to secure borrowings made in
accordance with paragraph 1 above. Initial margin deposits under interest rate
futures contracts, which are made to guarantee the Portfolio's performance under
such contracts, shall not be deemed a pledging of Portfolio assets for the
purpose of this investment restriction. As a matter of non-fundamental operating
policy, in order to permit the sale of shares of the Portfolio under certain
state laws, the Portfolio will not pledge its assets in excess of an amount
equal to 10% of its net assets unless such state restrictions are changed;
3. Invest more than 25% of its assets, measured at the time of investment,
in a single industry (which term shall not include governments or their
political subdivisions), outside the industries of the Portfolio's public
utilities Portfolio concentration, except that the Portfolio may, for temporary
defensive purposes, invest more than 25% of its total assets in the obligations
of banks;
4. Purchase the securities (other than government securities) of any issuer
if, as a result, more than 5% of the Portfolio's total assets would be invested
in the securities of such issuer, provided that up to 25% of the Portfolio's
total net assets may be invested without regard to this 5% limitation and in the
case of certificates of deposit, time deposits and banker's acceptances, up to
25% of total Portfolio assets may be invested without regard to such 5%
limitation, but shall instead be subject to a 10% limitation;
5. Invest in mineral leases;
6. Invest in bank time deposits with maturities of over 7 calendar days, or
invest more than 10% of the Portfolio's total assets in bank time deposits with
maturities of from 2 business days through 7 calendar days;
7. Issue senior securities, except to the extent that senior securities may
be deemed to arise from bank borrowings and purchases of government securities
on a "when-issued" or "delayed delivery" basis, as described in the Prospectus;
8. Underwrite any issue of securities, except to the extent the Portfolio
may be deemed to be an underwriter in connection with the sale of its portfolio
securities, although the Portfolio may purchase securities directly from the
issuers thereof for investment in accordance with the Portfolio's investment
objective and policies;
9. Purchase or sell commodities or commodity contracts, except that the
Portfolio may purchase and sell interest rate futures contracts for hedging
purposes as set forth in the Prospectus;
10. Purchase securities on margin or sell "short", but the Portfolio may
obtain such short-term credits as may be necessary for the clearance of
purchases and sales of securities. (Initial and maintenance margin deposits and
payment with respect to interest rate futures contracts are not considered the
purchase of securities on margin);
11. Purchase or retain the securities of any issuer, if, to the Portfolio's
knowledge, those officers and directors of the manager and sub-adviser who
individually own beneficially more than 0.5% of the outstanding securities of
such issuer together own beneficially more than 5% of such outstanding
securities;
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12. Invest in securities of other investment companies, except in the event
of merger or reorganization with another investment company;
13. Make loans, except to the extent the purchase of notes, bonds, bankers'
acceptances or other evidence of indebtedness or the entry into repurchase
agreements or deposits (including time deposits and certificates of deposit)
with banks may be considered loans;
14. Invest in companies for the purpose of exercising management for
control;
15. Invest in oil, gas or other mineral exploration or development
programs;
16. Purchase or hold any real estate or mortgage loans thereon, except that
the Portfolio may invest in securities secured by real estate or interests
therein or issued by persons (such as real estate investment trusts) which deal
in real estate or interests therein; and
17. Purchase the securities (other than government securities) of any
issuer if, as a result, the Portfolio would hold more than 10% of any class of
securities (including any class of voting securities) of such issuer; for this
purpose, all debt obligations of an issuer, and all shares of stock of an issuer
other than common stock, are treated as a single class of securities.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolio has adopted the following non-fundamental
investment restrictions which may be changed by the Board of Trustees without
shareholder approval. The Income Plus Portfolio may not:
(A) Write or purchase put, call, straddle or spread options, or
combinations thereof;
(B) Invest more than 10% of its net assets in illiquid securities;
(C) Invest in real estate limited partnerships; and
(D) Purchase or sell interest rate futures contracts (a) involving
aggregate delivery or purchase obligations in excess of 30% of the Portfolio's
net assets, or aggregate margin deposits made by the Portfolio in excess of 5%
of the Portfolio's net assets, (b) which are not for hedging purposes only, or
(c) which are executed under custodial, reserve and other arrangements
inconsistent with regulations and policies adopted or positions taken (i) by the
Securities and Exchange Commission for exemption from enforcement proceedings
under Section 17(f) or 18(f) of the 1940 Act, (ii) by the CFTC for exemption of
investment companies registered under the 1940 Act from registration as
"commodity pool operators" and from certain provisions of Subpart B of Part 4 of
the CFTC's regulations, or (iii) by state securities commissioners or
administrators in the states in which the Portfolio's shares have been qualified
for public offering.
INVESTMENT RESTRICTIONS OF IDEX TAX-EXEMPT PORTFOLIO
IDEX Tax-Exempt Portfolio may not, as a matter of fundamental policy:
1. Underwrite any issue of securities, except to the extent the Portfolio
may be deemed to be an underwriter in connection with the sale of its portfolio
securities, although the Portfolio may purchase Municipal Obligations directly
from the issuers thereof for investment in accordance with the Portfolio's
investment objective and policies.
2. Purchase the securities (other than government securities) of any issuer
if, as a result, more than 5% of the Portfolio's total assets would be invested
in the securities of such issuer, provided that up to 25% of the Portfolio's
total net assets may be invested without regard to this 5% limitation;
3. Invest in any direct interest in an oil, gas or other mineral
exploration or development program;
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4. Purchase securities on margin or sell "short", but the Portfolio may
obtain such short-term credits as may be necessary for the clearance of
purchases and sales of securities;
5. Purchase or hold any real estate or mortgage loans thereon, except that
the Portfolio may invest in securities secured by real estate or interests
therein or issued by persons (such as real estate investment trusts) which deal
in real estate or interests therein;
6. Purchase or retain the securities of any issuer, if, to the Portfolio's
knowledge, those officers and directors of the manager or sub-adviser who
individually own beneficially more than 0.5% of the outstanding securities of
such issuer together own beneficially more than 5% of such outstanding
securities;
7. Invest in securities of other investment companies, except in the event
of merger or reorganization with another investment company;
8. Make loans, except to the extent the purchase of notes, bonds, or other
evidences of indebtedness or the entry into repurchase agreements or deposits
with banks may be considered loans;
9. Invest in companies for the purpose of exercising management or control;
10. Write, purchase or sell put, call, straddle or spread options, except
for hedging purposes only, in accordance with such non-fundamental policies that
the Board may from time to time adopt;
11. Purchase or sell commodities or commodity contracts; and
12. The Portfolio may borrow money only for temporary or emergency purposes
(not for leveraging or investment) in an amount not exceeding 1/3 of the current
value of the Portfolio's total assets (including the amount borrowed) less
liabilities (not including the amount borrowed at the time the borrowing is
made). For purposes of this limitation, reverse repurchases would not constitute
borrowings.
As a fundamental policy governing concentration, the Portfolio will not
invest 25% or more of its total assets in any one particular industry, other
than U.S. government securities.
Furthermore, the Portfolio has adopted the following non-fundamental
restrictions which may be changed by the Board of Trustees without shareholder
approval:
(A) The Portfolio may not invest more than 10% of its net assets in
illiquid securities;
(B) The Portfolio may not invest in oil, gas or mineral leases;
(C) The Portfolio may not invest in real estate limited partnerships; and
(D) For hedging purposes only, the Tax-Exempt Portfolio may adopt policies
permitting:
(1) the purchase and sale of interest rate futures contracts, the purchase
of put and call options thereon, and the writing of covered call or
secured put options thereon, not involving delivery or purchase
obligations in excess of 30% of the Portfolio's net assets, and
(2) the purchase of put and call options related to portfolio securities
and securities to be purchased for the Tax- Exempt Portfolio, the
writing of secured put and covered call options, and the entering into
of closing purchase transactions with respect to such options, where
such transactions will not involve futures contract margin deposits
and premiums on option purchases which, in the aggregate, exceed 5% of
the Portfolio's net assets, in the judgment of the sub-adviser are
economically appropriate to the reduction of risks inherent in the
ongoing management of the Portfolio, and are executed under custodial,
reserve and other arrangements consistent with regulations and
policies adopted or positions taken (i) by the Securities and Exchange
Commission for exemption
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from enforcement proceedings under Section 17(f) or 18(f) of the
Investment Company Act of 1940, as amended (the "1940 Act"), (ii) by
the Commodity Futures Trading Commission (the "CFTC") for exemption of
investment companies registered under the 1940 Act from registration
as "commodity pool operators" and from certain provisions of Subpart B
of Part 4 of the CFTC's regulations, and (iii) by state securities
commissioners or administrators in the states in which the Portfolio's
shares have been qualified for public offering.
The Tax-Exempt Portfolio does not intend in the foreseeable future to adopt
the foregoing investment policies to permit trading in interest rate futures
contracts, options thereon, and options on portfolio securities.
Except with respect to borrowing money, if a percentage limitation set
forth above is complied with at the time of the investment, a subsequent change
in the percentage resulting from any change in value of the net assets of any of
the Portfolios will not result in a violation of such restriction. Additional
limitations on borrowing that are imposed by state law and regulations may
apply.
In addition to the above, as a fundamental policy, each of the Portfolios
other than the Tax-Exempt Portfolio and the Income Plus Portfolio, may,
notwithstanding any other investment policy or limitation (whether or not
fundamental), invest all of its assets in the securities of a single open-end
management investment company with substantially the same fundamental investment
objectives, policies and limitations as such Portfolio.
OTHER POLICIES AND PRACTICES OF THE PORTFOLIOS
FUTURES, OPTIONS AND OTHER DERIVATIVE INSTRUMENTS.
A. Futures Contracts. Each of the Portfolios other than the Tax-Exempt
Portfolio and the Income Plus Portfolio may enter into contracts for
the purchase or sale for future delivery of equity or fixed-income
securities, foreign currencies or contracts based on financial indices
including indices of U.S. government securities, foreign government
securities, equity or fixed-income securities ("futures contracts").
The Income Plus Portfolio may enter into contracts for the purchase or
sale of fixed-income securities ("interest rate futures contracts") as
described in the Prospectus. U.S. futures contracts are traded on
exchanges which have been designated "contract markets" by the
Commodity Futures Trading Commission ("CFTC") and must be executed
through a futures commission merchant ("FCM"), or brokerage firm,
which is a member of the relevant contract market. Through their
clearing corporations, the exchanges guarantee performance of the
contracts as between the clearing members of the exchange.
When a Portfolio buys or sells a futures contract it incurs a
contractual obligation to receive or deliver the underlying instrument
(or a cash payment based on the difference between the underlying
instrument's closing price and the price at which the contract was
entered into) at a specified price on a specified date. Transactions
in futures contracts may be made to attempt to hedge against potential
changes in interest or currency exchange rates or the price of a
security or a securities index which might correlate with or otherwise
adversely affect either the value of the Portfolio's securities or the
prices of securities which the Portfolio is considering buying at a
later date.
The buyer or seller of a futures contract is not required to deliver
or pay for the underlying instrument unless the contract is held until
the delivery date. However, both the buyer and seller are required to
deposit "initial margin" for the benefit of the FCM when the contract
is entered into. Initial margin deposits are equal to a percentage of
the contract's value, as set by the exchange on which the contract is
traded, and may be maintained in cash or ^ liquid assets by the
Portfolio's custodian for the benefit of the FCM. Initial margin
payments are similar to good faith deposits or performance bonds.
Unlike margin extended by a securities broker, initial margin payments
do not constitute purchasing securities on margin for purposes of a
Portfolio's investment limitations. If the value of either party's
position declines, that party will be required to make additional
"variation margin" payments with the FCM to settle the change in value
on a daily basis. The party that has a gain may be entitled to receive
all or a portion of this amount. In the event of the bankruptcy of the
FCM that holds margin on behalf of a Portfolio, that Portfolio may be
entitled to return of the margin owed to such Portfolio only in
proportion to the amount received by the FCM's other customers. The
portfolio manager will attempt to minimize the risk by careful
monitoring of the creditworthiness of the FCMs with which a Portfolio
does business and by segregating margin payments with the custodian.
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Although a Portfolio would segregate with the custodian cash and
liquid assets in an amount sufficient to cover its open futures
obligations, the segregated assets would be available to that
Portfolio immediately upon closing out the futures position, while
settlement of securities transactions could take several days.
However, because a Portfolio's cash that may otherwise be invested
would be held uninvested or invested in liquid assets so long as the
futures position remains open, such Portfolio's return could be
diminished due to the opportunity losses of foregoing other potential
investments.
The acquisition or sale of a futures contract may occur, for example,
when a Portfolio holds or is considering purchasing equity or debt
securities and seeks to protect itself from fluctuations in prices or
interest rates without buying or selling those securities. For
example, if stock or debt prices were expected to decrease, a
Portfolio might sell equity index futures contracts, thereby hoping to
offset a potential decline in the value of equity securities in the
Portfolio by a corresponding increase in the value of the futures
contract position held by that Portfolio and thereby preventing the
Portfolio's net asset value from declining as much as it otherwise
would have. Similarly, if interest rates were expected to rise, a
Portfolio might sell bond index futures contracts, thereby hoping to
offset a potential decline in the value of debt securities in the
portfolio by a corresponding increase in the value of the futures
contract position held by the Portfolio. A Portfolio also could seek
to protect against potential price declines by selling portfolio
securities and investing in money market instruments. However, since
the futures market is more liquid than the cash market, the use of
futures contracts as an investment technique allows a Portfolio to
maintain a defensive position without having to sell portfolio
securities.
Similarly, when prices of equity securities are expected to increase,
or interest rates are expected to fall, futures contracts may be
bought to attempt to hedge against the possibility of having to buy
equity securities at higher prices. This technique is sometimes known
as an anticipatory hedge. Since the fluctuations in the value of
futures contracts should be similar to those of equity securities, a
Portfolio could take advantage of the potential rise in the value of
equity or debt securities without buying them until the market has
stabilized. At that time, the futures contracts could be liquidated
and such Portfolio could buy equity or debt securities on the cash
market. To the extent a Portfolio enters into futures contracts for
this purpose, the segregated assets maintained to cover such
Portfolio's obligations with respect to futures contracts will consist
of liquid assets from its portfolio in an amount equal to the
difference between the contract price and the aggregate value of the
initial and variation margin payments made by that Portfolio with
respect to the futures contracts.
The ordinary spreads between prices in the cash and futures markets,
due to differences in the nature of those markets, are subject to
distortions. First, all participants in the futures market are subject
to initial margin and variation margin requirements. Rather than
meeting additional variation margin requirements, investors may close
out futures contracts through offsetting transactions which could
distort the normal price relationship between the cash and futures
markets. Second, the liquidity of the futures market depends on
participants entering into offsetting transactions rather than making
or taking delivery. To the extent participants decide to make or take
delivery, liquidity in the futures market could be reduced and prices
in the futures market distorted. Third, from the point of view of
speculators, the margin deposit requirements in the futures market are
less onerous than margin requirements in the securities market.
Therefore, increased participation by speculators in the futures
market may cause temporary price distortions. Due to the possibility
of the foregoing distortions, a correct forecast of general price
trends by the portfolio manager still may not result in a successful
use of futures contracts.
Futures contracts entail risks. Although each of the Portfolios that
invests in such contracts believes that their use will benefit the
Portfolio, if the portfolio manager's investment judgment proves
incorrect, the Portfolio's overall performance could be worse than if
the Portfolio had not entered into futures contracts. For example, if
a Portfolio has hedged against the effects of a possible decrease in
prices of securities held in its portfolio and prices increase
instead, that Portfolio may lose part or all of the benefit of the
increased value of the securities because of offsetting losses in the
Portfolio's futures positions. In addition, if a Portfolio has
insufficient cash, it may have to sell securities from its portfolio
to meet daily variation margin requirements. Those sales may, but will
not necessarily, be at increased prices which reflect the rising
market and may occur at a time when the sales are disadvantageous to
the Portfolio.
The prices of futures contracts depend primarily on the value of their
underlying instruments. Because there are a limited number of types of
futures contracts, it is possible that the standardized futures
contracts available to a Portfolio
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will not match exactly such Portfolio's current or potential
investments. A Portfolio may buy and sell futures contracts based on
underlying instruments with different characteristics from the
securities in which it typically invests--for example, by hedging
investments in portfolio securities with a futures contract based on a
broad index of securities--which involves a risk that the futures
position will not correlate precisely with such performance of the
Portfolio's investments.
Futures prices can also diverge from the prices of their underlying
instruments, even if the underlying instruments correlate with a
Portfolio's investments. Futures prices are affected by factors such
as current and anticipated short-term interest rates, changes in
volatility of the underlying instruments, and the time remaining until
expiration of the contract. Those factors may affect securities prices
differently from futures prices. Imperfect correlations between a
Portfolio's investments and its futures positions may also result from
differing levels of demand in the futures markets and the securities
markets, from structural differences in how futures and securities are
traded, and from imposition of daily price fluctuation limits for
futures contracts. A Portfolio may buy or sell futures contracts with
a greater or lesser value than the securities it wishes to hedge or is
considering purchasing in order to attempt to compensate for
differences in historical volatility between the futures contract and
the securities, although this may not be successful in all cases. If
price changes in a Portfolio's futures positions are poorly correlated
with its other investments, its futures positions may fail to produce
desired gains or may result in losses that are not offset by the gains
in that Portfolio's other investments.
Because futures contracts are generally settled within a day from the
date they are closed out, compared with a settlement period of seven
days for some types of securities, the futures markets can provide
superior liquidity to the securities markets. Nevertheless, there is
no assurance a liquid secondary market will exist for any particular
futures contract at any particular time. In addition, futures
exchanges may establish daily price fluctuation limits for futures
contracts and may halt trading if a contract's price moves upward or
downward more than the limit in a given day. On volatile trading days
when the price fluctuation limit is reached, it may be impossible for
a Portfolio to enter into new positions or close out existing
positions. If the secondary market for a futures contract is not
liquid because of price fluctuation limits or otherwise, the Portfolio
may not be able to promptly liquidate unfavorable futures positions
and potentially could be required to continue to hold a futures
position until the delivery date, regardless of changes in its value.
As a result, such Portfolio's access to other assets held to cover its
futures positions also could be impaired.
Although futures contracts by their terms call for the delivery or
acquisition of the underlying commodities or a cash payment based on
the value of the underlying commodities, in most cases the contractual
obligation is offset before the delivery date of the contract by
buying, in the case of a contractual obligation to sell, or selling,
in the case of a contractual obligation to buy, an identical futures
contract on a commodities exchange. Such a transaction cancels the
obligation to make or take delivery of the commodities.
The Aggressive Growth, Capital Appreciation, International Equity,
Global, Growth, Value Equity, C.A.S.E., ^ Strategic Total Return,
Tactical Asset Allocation, Balanced and Flexible Income Portfolios
each intend to comply with guidelines of eligibility for exclusion
from the definition of the term "commodity pool operator" with the
CFTC and the National Futures Association, which regulate trading in
the futures markets. The Portfolios will use futures contracts and
related options primarily for bona fide hedging purposes within the
meaning of CFTC regulations; except that, in addition, the Portfolios
may hold positions in futures contracts and related options that do
not fall within the definition of bona fide hedging transactions,
provided that the aggregate initial margin and premiums required to
establish such positions will not exceed 5% of the fair market value
of a Portfolio's net assets, after taking into account unrealized
profits and unrealized losses on any such contracts it has entered
into.
The Aggressive Growth Portfolio may not enter in a futures contract or
related option (except for closing transactions) if, immediately
thereafter, the sum of the amount of its initial margin and premiums
on open futures contracts and options thereon would exceed 5% of the
Aggressive Growth Portfolio's total assets (taken at current value);
however, in the case of an option that is in-the-money at the time of
the purchase, the in-the-money amount may be excluded in calculating
the 5% limitation.
B. Options on Futures Contracts. Each of the Portfolios other than the
Tax-Exempt and Income Plus Portfolios may buy and write put and call
options on futures contracts. An option on a future gives a Portfolio
the right (but not the obligation) to buy or sell a futures contract
at a specified price on or before a specified date. Transactions in
options
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on futures contracts may be made to attempt to hedge against potential
changes in interest rates or currency exchange rates or the price of a
security or a securities index which might correlate with or otherwise
adversely affect either the value of the Portfolio's securities or the
prices of securities which the Portfolio is considering buying at a
later date. Transactions in options on future contracts will not be
made for speculation.
The purchase of a call option on a futures contract is similar in some
respects to the purchase of a call option on an individual security.
Depending on the pricing of the option compared to either the price of
the futures contract upon which it is based or the price of the
underlying instrument, ownership of the option may or may not be less
risky than ownership of the futures contract or the underlying
instrument. As with the purchase of futures contracts, when a
Portfolio is not fully invested it may buy a call option on a futures
contract to hedge against a market advance.
The writing of a call option on a futures contract constitutes a
partial hedge against declining prices of the security or foreign
currency which is deliverable under, or of the index comprising, the
futures contract. If the futures price at the expiration of the option
is below the exercise price, a Portfolio will retain the full amount
of the option premium which provides a partial hedge against any
decline that may have occurred in such Portfolio's holdings. The
writing of a put option on a futures contract constitutes a partial
hedge against increasing prices of the security or foreign currency
which is deliverable under, or of the index comprising, the futures
contract. If the futures price at expiration of the option is higher
than the exercise price, a Portfolio will retain the full amount of
the option premium which provides a partial hedge against any increase
in the price of securities which that Portfolio is considering buying.
If a call or put option a Portfolio has written is exercised, such
Portfolio will incur a loss which will be reduced by the amount of the
premium it received. Depending on the degree of correlation between
the change in the value of its portfolio securities and changes in the
value of the futures positions, that Portfolio's losses from existing
options on futures may to some extent be reduced or increased by
changes in the value of portfolio securities.
The purchase of a put option on a futures contract is similar in some
respects to the purchase of protective put options on portfolio
securities. For example, a Portfolio may buy a put option on a futures
contract to hedge its portfolio securities against the risk of falling
prices or rising interest rates.
The amount of risk a Portfolio assumes when it buys an option on a
futures contract is the premium paid for the option plus related
transaction costs. In addition to the correlation risks discussed
above, the purchase of an option also entails the risk that changes in
the value of the underlying futures contract will not be fully
reflected in the value of the options bought.
C. Options on Securities. In an effort to increase current income and to
reduce fluctuations in net asset value, each of the Portfolios other
than the Tax-Exempt Portfolio and the Income Plus Portfolio may write
covered put and call options and buy put and call options on
securities that are traded on United States and foreign securities
exchanges and over-the-counter. A Portfolio also may write call
options that are not covered for cross-hedging purposes. A Portfolio
may write and buy options on the same types of securities that the
Portfolio may purchase directly. There are no specific limitations on
the Portfolios' writing and buying of options on securities.
A put option gives the holder the right, upon payment of a premium, to
deliver a specified amount of a security to the writer of the option
on or before a fixed date at a predetermined price. A call option
gives the holder the right, upon payment of a premium, to call upon
the writer to deliver a specified amount of a security on or before a
fixed date at a predetermined price.
A put option written by a Portfolio is "covered" if the Portfolio (i)
segregates cash not available for investment or other liquid assets
with a value equal to the exercise price with its custodian or (ii)
continues to own an equivalent number of puts of the same "series"
(that is, puts on the same underlying securities having the same
exercise prices and expiration dates as those written by the
Portfolio), or an equivalent number of puts of the same "class" (that
is, puts on the same underlying securities) with exercise prices
greater than those it has written (or if the exercise prices of the
puts it holds are less than the exercise prices of those it has
written, the difference is segregated with the custodian). The premium
paid by the buyer of an option will reflect, among other things, the
relationship of the exercise price to the market price and the
volatility of the underlying security, the remaining term of the
option, supply and demand and interest rates.
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A call option written by a Portfolio is "covered" if the Portfolio
owns the underlying security covered by the call or has an absolute
and immediate right to acquire that security without additional cash
consideration (or has segregated additional cash with its custodian)
upon conversion or exchange of other securities held in its portfolio.
A call option written by a Portfolio is also deemed to be covered (i)
if that Portfolio holds a call at the same exercise price for the same
exercise period and on the same securities as the call written, (ii)
in the case of a call on a stock index, if the Portfolio owns a
portfolio of securities substantially replicating the movement of the
index underlying the call option, or (iii) if at the time the call is
written an amount of cash, U.S. government securities or other liquid
assets equal to the fluctuating market value of the optioned
securities is segregated with the custodian.
A Portfolio may also write call options that are not covered for cross
hedging purposes. A Portfolio collateralizes its obligation under a
written call option for cross-hedging purposes by segregating cash or
other liquid assets in an amount not less than the market value of the
underlying security, marked-to-market daily. A Portfolio would write a
call option for cross-hedging purposes, instead of writing a covered
call option, when the premium to be received from the cross-hedge
transaction would exceed that which would be received from writing a
covered call option and the portfolio manager believes that writing
the option would achieve the desired hedge.
If a put or call option written by a Portfolio were exercised, the
Portfolio would be obligated to buy or sell the underlying security at
the exercise price. Writing a put option involves the risk of a
decrease in the market value of the underlying security, in which case
the option could be exercised and the underlying security would then
be sold by the option holder to the Portfolio at a higher price than
its current market value. Writing a call option involves the risk of
an increase in the market value of the underlying security, in which
case the option could be exercised and the underlying security would
then be sold by the Portfolio to the option holder at a lower price
than its current market value. Those risks could be reduced by
entering into an offsetting transaction. A Portfolio retains the
premium received from writing a put or call option whether or not the
option is exercised.
The writer of an option may have no control when the underlying
security must be sold, in the case of a call option, or bought, in the
case of a put option, since with regard to certain options, the writer
may be assigned an exercise notice at any time prior to the
termination of the obligation. Whether or not an option expires
unexercised, the writer retains the amount of the premium. This
amount, of course, may, in the case of a covered call option, be
offset by a decline in the market value of the underlying security
during the option period. If a call option is exercised, the writer
experiences a profit or loss from the sale of the underlying security.
If a put option is exercised, the writer must fulfill the obligation
to buy the underlying security at the exercise price, which will
usually exceed the then market value of the underlying security.
The writer of an option that wishes to terminate its obligation may
effect a "closing purchase transaction." This is accomplished by
buying an option of the same series as the option previously written.
The effect of the purchase is that the writer's position will be
canceled by the clearing corporation. However, a writer may not effect
a closing purchase transaction after being notified of the exercise of
an option. Likewise, an investor who is the holder of an option may
liquidate its position by effecting a "closing sale transaction." This
is accomplished by selling an option of the same series as the option
previously bought. There is no guarantee that either a closing
purchase or a closing sale transaction can be effected.
In the case of a written call option, effecting a closing transaction
will permit a Portfolio to write another call option on the underlying
security with either a different exercise price or expiration date or
both. In the case of a written put option, such transaction will
permit the Portfolio to write another put option to the extent that
the exercise price thereof is secured by deposited other liquid
assets. Effecting a closing transaction also will permit the cash or
proceeds from the concurrent sale of any securities subject to the
option to be used for other Portfolio investments. If a Portfolio
desires to sell a particular security on which the Portfolio has
written a call option, such Portfolio will effect a closing
transaction prior to or concurrent with the sale of the security.
A Portfolio will realize a profit from a closing transaction if the
price of a purchase transaction is less than the premium received from
writing the option or the price received from a sale transaction is
more than the premium paid to buy the option. The Portfolio will
realize a loss from a closing transaction if the price of the purchase
transaction is more than the premium received from writing the option
or the price received from a sale transaction is less than the premium
paid to buy the option. Because increases in the market price of a
call option will generally reflect increases
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in the market price of the underlying security, any loss resulting
from the repurchase of a call option is likely to be offset in whole
or in part by appreciation of the underlying security owned by the
Portfolio.
An option position may be closed out only where a secondary market for
an option of the same series exists. If a secondary market does not
exist, a Portfolio may not be able to effect closing transactions in
particular options and that Portfolio would have to exercise the
options in order to realize any profit. If a Portfolio is unable to
effect a closing purchase transaction in a secondary market, it will
not be able to sell the underlying security until the option expires
or it delivers the underlying security upon exercise. Reasons for the
absence of a liquid secondary market may include the following: (i)
there may be insufficient trading interest in certain options, (ii)
restrictions may be imposed by a national securities exchange on which
the option is traded ("Exchange") on opening or closing transactions
or both, (iii) trading halts, suspensions or other restrictions may be
imposed with respect to particular classes or series of options or
underlying securities, (iv) unusual or unforeseen circumstances may
interrupt normal operations on an Exchange, (v) the facilities of an
Exchange or the Options Clearing Corporation ("OCC") may not at all
times be adequate to handle current trading volume, or (vi) one or
more Exchanges could, for economic or other reasons, decide or be
compelled at some future date to discontinue the trading of options
(or a particular class or series of options), in which event the
secondary market on that Exchange (or in that class or series of
options) would cease to exist, although outstanding options on that
Exchange that had been issued by the OCC as a result of trades on that
Exchange would continue to be exercisable in accordance with their
terms.
Each of the Portfolios other than the Tax-Exempt Portfolio and the
Income Plus Portfolio may write options in connection with
buy-and-write transactions. In other words, the Portfolio may buy a
security and then write a call option against that security. The
exercise price of such call will depend upon the expected price
movement of the underlying security. The exercise price of a call
option may be below ("in-the-money"), equal to ("at-the-money") or
above ("out-of-the-money") the current value of the underlying
security at the time the option is written. Buy-and-write transactions
using in-the-money call options may be used when it is expected that
the price of the underlying security will remain flat or decline
moderately during the option period. Buy-and-write transactions using
at-the-money call options may be used when it is expected that the
price of the underlying security will remain fixed or advance
moderately during the option period. Buy-and-write transactions using
out-of-the-money call options may be used when it is expected that the
premiums received from writing the call option plus the appreciation
in the market price of the underlying security up to the exercise
price will be greater than the appreciation in the price of the
underlying security alone. If the call options are exercised in such
transactions, the Portfolio's maximum gain will be the premium
received by it for writing the option, adjusted upwards or downwards
by the difference between that Portfolio's purchase price of the
security and the exercise price. If the options are not exercised and
the price of the underlying security declines, the amount of such
decline will be offset by the amount of premium received.
The writing of covered put options is similar in terms of risk and
return characteristics to buy-and-write transactions. If the market
price of the underlying security rises or otherwise is above the
exercise price, the put option will expire worthless and a Portfolio's
gain will be limited to the premium received. If the market price of
the underlying security declines or otherwise is below the exercise
price, a Portfolio may elect to close the position or take delivery of
the security at the exercise price and that Portfolio's return will be
the premium received from the put options minus the amount by which
the market price of the security is below the exercise price.
A Portfolio may buy put options to hedge against a decline in the
value of its Portfolio. By using put options in this way, a Portfolio
will reduce any profit it might otherwise have realized in the
underlying security by the amount of the premium paid for the put
option and by transaction costs.
A Portfolio may buy call options to hedge against an increase in the
price of securities that it may buy in the future. The premium paid
for the call option plus any transaction costs will reduce the
benefit, if any, realized by such Portfolio upon exercise of the
option, and, unless the price of the underlying security rises
sufficiently, the option may expire worthless to that Portfolio.
In purchasing an option, a Portfolio would be in a position to realize
a gain if, during the option period, the price of the underlying
security increased (in the case of a call) or decreased (in the case
of a put) by an amount in excess of the premium paid and would realize
a loss if the price of the underlying security did not increase (in
the case of a call) or decrease (in the case of a put) during the
period by more than the amount of the premium. If a put or call option
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purchased by a Portfolio were permitted to expire without being sold
or exercised, the Portfolio would lose the amount of the premium.
Although they entitle the holder to buy equity securities, warrants on
and options to purchase equity securities do not entitle the holder to
dividends or voting rights with respect to the underlying securities,
nor do they represent any rights in the assets of the issuer of those
securities.
In addition to options on securities, a Portfolio may also purchase
and sell call and put options on securities indexes. A stock index
reflects in a single number the market value of many different stocks.
Relative values are assigned to the stocks included in an index and
the index fluctuates with changes in the market values of the stocks.
The options give the holder the right to receive a cash settlement
during the term of the option based on the difference between the
exercise price and the value of the index. By writing a put or call
option on a securities index, the Portfolio is obligated, in return
for the premium received, to make delivery of this amount. The
Portfolio may offset its position in stock index options prior to
expiration by entering into a closing transaction on an exchange or it
may let the option expire unexercised.
Use of options on securities indexes entails the risk that trading in
the options may be interrupted if trading in certain securities
included in the index is interrupted. The Portfolio will not purchase
these options unless the sub-adviser is satisfied with the
development, depth and liquidity of the market and believes the
options can be closed out.
Price movements in the Portfolio's securities may not correlate
precisely with movements in the level of an index and, therefore, the
use of options on indexes cannot serve as a complete hedge and will
depend, in part, on the ability of its portfolio manager to predict
correctly movements in the direction of the stock market generally or
of a particular industry. Because options on securities indexes
require settlement in cash, the portfolio manager may be forced to
liquidate portfolio securities to meet settlement obligations.
The amount of risk a Portfolio assumes when it buys an option on a
futures contract is the premium paid for the option plus related
transaction costs. In addition to the correlation risks discussed
above, the purchase of an option also entails the risk that changes in
the value of the underlying futures contract will not be fully
reflected in the value of the options bought.
D. Options on Foreign Currencies. Each of the Portfolios other than the
Tax-Exempt Portfolio and the Income Plus Portfolio may buy and write
options on foreign currencies in a manner similar to that in which
futures contracts or forward contracts on foreign currencies will be
utilized. For example, a decline in the U.S. dollar value of a foreign
currency in which portfolio securities are denominated will reduce the
U.S. dollar value of such securities, even if their value in the
foreign currency remains constant. In order to protect against such
diminutions in the value of portfolio securities, a Portfolio may buy
put options on the foreign currency. If the value of the currency
declines, such Portfolio will have the right to sell such currency for
a fixed amount in U.S. dollars and will offset, in whole or in part,
the adverse effect on its portfolio.
Conversely, when a rise in the U.S. dollar value of a currency in
which securities to be acquired are denominated is projected, thereby
increasing the cost of such securities, a Portfolio may buy call
options thereon. The purchase of such options could offset, at least
partially, the effects of the adverse movements in exchange rates. As
in the case of other types of options, however, the benefit to a
Portfolio from purchases of foreign currency options will be reduced
by the amount of the premium and related transaction costs. In
addition, if currency exchange rates do not move in the direction or
to the extent desired, a Portfolio could sustain losses on
transactions in foreign currency options that would require such
Portfolio to forego a portion or all of the benefits of advantageous
changes in those rates. In addition, in the case of other types of
options, the benefit to the Portfolio from purchases of foreign
currency options will be reduced by the amount of the premium and
related transaction costs.
A Portfolio may also write options on foreign currencies. For example,
in attempting to hedge against a potential decline in the U.S. dollar
value of foreign currency denominated securities due to adverse
fluctuations in exchange rates, a Portfolio could, instead of
purchasing a put option, write a call option on the relevant currency.
If the expected decline occurs, the option will most likely not be
exercised and the diminution in value of portfolio securities will be
offset by the amount of the premium received.
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Similarly, instead of purchasing a call option to attempt to hedge
against a potential increase in the U.S. dollar cost of securities to
be acquired, a Portfolio could write a put option on the relevant
currency which, if rates move in the manner projected, will expire
unexercised and allow that Portfolio to hedge the increased cost up to
the amount of premium. As in the case of other types of options,
however, the writing of a foreign currency option will constitute only
a partial hedge up to the amount of the premium. If exchange rates do
not move in the expected direction, the option may be exercised and a
Portfolio would be required to buy or sell the underlying currency at
a loss which may not be offset by the amount of the premium. Through
the writing of options on foreign currencies, a Portfolio also may
lose all or a portion of the benefits which might otherwise have been
obtained from favorable movements in exchange rates.
A Portfolio may write covered call options on foreign currencies. A
call option written on a foreign currency by a Portfolio is "covered"
if that Portfolio owns the underlying foreign currency covered by the
call or has an absolute and immediate right to acquire that foreign
currency without additional cash consideration (or for additional cash
consideration that is segregated by its custodian) upon conversion or
exchange of other foreign currency held in its portfolio. A call
option is also covered if (i) the Portfolio holds a call at the same
exercise price for the same exercise period and on the same currency
as the call written or (ii) at the time the call is written, an amount
of cash, U.S. government securities or other liquid assets equal to
the fluctuating market value of the optioned currency is segregated
with the custodian.
Each of the Portfolios other than the Tax-Exempt Portfolio and the
Income Plus Portfolio may write call options on foreign currencies for
cross-hedging purposes that would not be deemed to be covered. A call
option on a foreign currency is for cross-hedging purposes if it is
not covered but is designed to provide a hedge against a decline due
to an adverse change in the exchange rate in the U.S. dollar value of
a security which the Portfolio owns or has the right to acquire and
which is denominated in the currency underlying the option. In such
circumstances, a Portfolio collateralizes the option by segregating
cash or other liquid assets in an amount not less than the value of
the underlying foreign currency in U.S. dollars marked-to-market
daily.
E. Forward Contracts. A forward contract is an agreement between two
parties in which one party is obligated to deliver a stated amount of
a stated asset at a specified time in the future and the other party
is obligated to pay a specified invoice amount for the assets at the
time of delivery. Each of the Portfolios other than the Tax-Exempt
Portfolio and Income Plus Portfolio may enter into forward contracts
to purchase and sell government securities, foreign currencies or
other financial instruments. Forward contracts generally are traded in
an interbank market conducted directly between traders (usually large
commercial banks) and their customers. Unlike futures contracts, which
are standardized contracts, forward contracts can be specifically
drawn to meet the needs of the parties that enter into them. The
parties to a forward contract may agree to offset or terminate the
contract before its maturity, or may hold the contract to maturity and
complete the contemplated exchange.
The following discussion summarizes the Aggressive Growth, Capital
Appreciation, International Equity, Global, Growth, Value Equity,
C.A.S.E., ^ Strategic Total Return, Tactical Asset Allocation,
Balanced and Flexible Income Portfolios' principal uses of forward
foreign currency exchange contracts ("forward currency contracts"). A
Portfolio may enter into forward currency contracts with stated
contract values of up to the value of that Portfolio's assets. A
forward currency contract is an obligation to buy or sell an amount of
a specified currency for an agreed price (which may be in U.S. dollars
or another currency). A Portfolio will exchange foreign currencies for
U.S. Dollars and for other foreign currencies in the normal course of
business and may buy and sell currencies through forward currency
contracts in order to fix a price for securities it has agreed to buy
or sell ("transaction hedge"). A Portfolio also may hedge some or all
of its investments denominated in foreign currency or exposed to
foreign currency fluctuations against a decline in the value of that
currency relative to the U.S. dollar by entering into forward currency
contracts to sell an amount of that currency (or a proxy currency
whose performance is expected to replicate or exceed the performance
of that currency relative to the U.S. dollar) approximating the value
of some or all of its portfolio securities denominated in that
currency ("position hedge") or by participating in options or futures
contracts with respect to the currency. A Portfolio also may enter
into a forward currency contract with respect to a currency where such
Portfolio is considering the purchase or sale of investments
denominated in that currency but has not yet selected the specific
investments ("anticipatory hedge"). In any of these circumstances a
Portfolio may, alternatively, enter into a forward currency contract
to purchase or sell one foreign currency for a second currency that is
expected to perform
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more favorably relative to the U.S. dollar if the portfolio manager
believes there is a reasonable degree of correlation between movements
in the two currencies ("cross-hedge").
These types of hedging seek to minimize the effect of currency
appreciation as well as depreciation, but do not eliminate
fluctuations in the underlying U.S. dollar equivalent value of the
proceeds of or rates of return on a Portfolio's foreign currency
denominated portfolio securities. The matching of the increase in
value of a forward contract and the decline in the U.S. dollar
equivalent value of the foreign currency denominated asset that is the
subject of the hedge generally will not be precise. Shifting a
Portfolio's currency exposure from one foreign currency to another
removes that Portfolio's opportunity to profit from increases in the
value of the original currency and involves a risk of increased losses
to such Portfolio if its portfolio manager's position projection of
future exchange rates is inaccurate. Proxy hedges and cross-hedges may
result in losses if the currency used to hedge does not perform
similarly to the currency in which hedged securities are denominated.
Unforeseen changes in currency prices may result in poorer overall
performance for a Portfolio than if it had not entered into such
contracts.
A Portfolio will cover outstanding forward currency contracts by
maintaining liquid portfolio securities denominated in the currency
underlying the forward contract or the currency being hedged. To the
extent that a Portfolio is not able to cover its forward currency
positions with underlying portfolio securities, its custodian will
segregate cash or other liquid assets having a value equal to the
aggregate amount of such Portfolio's commitments under forward
contracts entered into with respect to position hedges, cross-hedges
and anticipatory hedges. If the value of the securities used to cover
a position or the value of segregated assets declines, the Portfolio
will find alternative cover or segregate additional cash or other
liquid assets on a daily basis so that the value of the covered and
segregated assets will be equal to the amount of a Portfolio's
commitments with respect to such contracts. As an alternative to
segregating assets, a Portfolio may buy call options permitting such
Portfolio to buy the amount of foreign currency being hedged by a
forward sale contract or a Portfolio may buy put options permitting it
to sell the amount of foreign currency subject to a forward buy
contact.
While forward contracts are not currently regulated by the CFTC, the
CFTC may in the future assert authority to regulate forward contracts.
In such event, a Portfolio's ability to utilize forward contracts may
be restricted. In addition, a Portfolio may not always be able to
enter into forward contracts at attractive prices and may be limited
in its ability to use these contracts to hedge its assets.
F. Swaps and Swap-Related Products. In order to attempt to protect the
value of its investments from interest rate or currency exchange rate
fluctuations, each of the Portfolios other than the Tax-Exempt
Portfolio and the Income Plus Portfolio may enter into interest rate
and currency exchange rate swaps, and may buy or sell interest rate
and currency exchange rate caps and floors. The portfolio manager
expects to enter into these transactions primarily to attempt to
preserve a return or spread on a particular investment or portion of
its portfolio. A Portfolio also may enter into these transactions to
attempt to protect against any increase in the price of securities the
Portfolio may consider buying at a later date.
Each Portfolio does not intend to use these transactions as a
speculative investment. Interest rate swaps involve the exchange by a
Portfolio with another party of their respective commitments to pay or
receive interest, e.g., an exchange of floating rate payments for
fixed rate payments. The exchange commitments can involve payments to
be made in the same currency or in different currencies. The purchase
of an interest rate cap entitles the purchaser, to the extent that a
specified index exceeds a predetermined interest rate, to receive
payments of interest on a contractually based principal amount from
the party selling the interest rate cap. The purchase of an interest
rate floor entitles the purchaser, to the extent that a specified
index falls below a predetermined interest rate, to receive payments
of interest on a contractually based principal amount from the party
selling the interest rate floor.
Each of the Portfolios other than the Tax-Exempt and Income Plus
Portfolios may enter into interest rate swaps, caps and floors on
either an asset-based or liability-based basis, depending upon whether
it is hedging its assets or its liabilities, and will usually enter
into interest rate swaps on a net basis (i.e., the two payment streams
are netted out, with a Portfolio receiving or paying, as the case may
be, only the net amount of the two payments). The net amount of the
excess, if any, of a Portfolio's obligations over its entitlements
with respect to each interest rate swap will be calculated on a daily
basis and an amount of cash or other liquid assets having an aggregate
net asset at least equal to the accrued excess will be segregated by
its custodian. If a Portfolio enters into an interest rate swap on
other than a
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net basis, it will maintain a segregated account in the full amount
accrued on a daily basis of its obligations with respect to the swap.
A Portfolio will not enter into any interest rate swap, cap or floor
transaction unless the unsecured senior debt or the claims-paying
ability of the other party thereto is rated in one of the three
highest rating categories of at least one nationally recognized
statistical rating organization at the time of entering into such
transaction. The portfolio manager will monitor the creditworthiness
of all counterparties on an ongoing basis. If there is a default by
the other party to such a transaction, the Portfolio will have
contractual remedies pursuant to the agreements related to the
transaction.
The swap market has grown substantially in recent years with a large
number of banks and investment banking firms acting both as principals
and as agents utilizing standardized swap documentation. The
sub-advisers have determined that, as a result, the swap market has
become relatively liquid. Caps and floors are more recent innovations
for which standardized documentation has not yet been developed and,
accordingly, they are less liquid than swaps. To the extent a
Portfolio sells (i.e., writes) caps and floors, it will segregate cash
or other liquid assets having an aggregate net asset value at least
equal to the full amount, accrued on a daily basis, of its obligations
with respect to any caps or floors.
There is no limit on the amount of interest rate swap transactions
that may be entered into by the Aggressive Growth, Capital
Appreciation, International Equity, Global, Growth, Value Equity,
C.A.S.E., ^ Strategic Total Return, Tactical Asset Allocation,
Balanced and Flexible Income Portfolios, although none of the
Portfolios presently intends to engage in such transactions in excess
of 5% of its total assets. These transactions may in some instances
involve the delivery of securities or other underlying assets by a
Portfolio or its counterparty to collateralize obligations under the
swap. Under the documentation currently used in those markets, the
risk of loss with respect to interest rate swaps is limited to the net
amount of the interest payments that a Portfolio is contractually
obligated to make. If the other party to an interest rate swap that is
not collateralized defaults, a Portfolio would risk the loss of the
net amount of the payments that it contractually is entitled to
receive. A Portfolio may buy and sell (i.e., write) caps and floors
without limitation, subject to the segregation requirement described
above.
In addition to the instruments, strategies and risks described in this
Statement of Additional Information and in the Prospectus, there may
be additional opportunities in connection with options, futures
contracts, forward currency contracts and other hedging techniques,
that become available as the portfolio managers develop new
techniques, as regulatory authorities broaden the range of permitted
transactions and as new instruments are developed. The portfolio
managers may use these opportunities to the extent they are consistent
with the Portfolio's investment objective and are permitted by the
Portfolio's investment limitations and applicable regulatory
requirements.
G. Eurodollar Instruments. The Portfolios may each make investments in
Eurodollar instruments. Eurodollar instruments are U.S.
dollar-denominated futures contracts or options thereon which are
linked to the London Interbank Offered Rate (the "LIBOR"), although
foreign currency-denominated instruments are available from time to
time. Eurodollar futures contracts enable purchasers to obtain a fixed
rate for the lending of funds and sellers to obtain a fixed rate for
borrowings. A Portfolio might use Eurodollar futures contracts and
options thereon to hedge against changes in LIBOR, to which many
interest rate swaps and fixed income instruments are linked.
H. Special Investment Considerations and Risks. The successful use of the
investment practices described above with respect to futures
contracts, options on futures contracts, forward contracts, options on
securities and on foreign currencies, and swaps and swap-related
products draws upon skills and experience which are different from
those needed to select the other instruments in which a Portfolio
invests. Should interest or exchange rates or the prices of securities
or financial indices move in an unexpected manner, a Portfolio may not
achieve the desired benefits of the foregoing instruments or may
realize losses and thus be in a worse position than if such strategies
had not been used. Unlike many exchange-traded futures contracts and
options on futures contracts, there are no daily price fluctuation
limits with respect to options on currencies, forward contracts and
other negotiated or over-the-counter instruments, and adverse market
movements could therefore continue to an unlimited extent over a
period of time. In addition, the correlation between movements in the
price of the securities and currencies hedged or used for cover will
not be perfect and could produce unanticipated losses.
A Portfolio's ability to dispose of its positions in the foregoing
instruments will depend on the availability of liquid markets in the
instruments. Markets in a number of the instruments are relatively new
and still developing, and it is
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impossible to predict the amount of trading interest that may exist in
those instruments in the future. Particular risks exist with respect
to the use of each of the foregoing instruments and could result in
such adverse consequences to a Portfolio as the possible loss of the
entire premium paid for an option bought by a Portfolio, the inability
of the Portfolio, as the writer of a covered call option, to benefit
from the appreciation of the underlying securities above the exercise
price of the option and the possible need to defer closing out
positions in certain instruments to avoid adverse tax consequences. As
a result, no assurance can be given that a Portfolio will be able to
use those instruments effectively for their intended purposes.
In connection with certain of its hedging transactions, a Portfolio
must segregate assets with the Fund's custodian bank to ensure that
such Portfolio will be able to meet its obligations pursuant to these
instruments. Segregated assets generally may be not be disposed of for
so long as a Portfolio maintains the positions giving rise to the
segregation requirement. Segregation of a large percentage of a
Portfolio's assets could impede implementation of that Portfolio's
investment policies or its ability to meet redemption requests or
other current obligations.
I. Additional Risks of Options on Foreign Currencies, Forward Contracts
and Foreign Instruments. Unlike transactions entered into by a
Portfolio in futures contracts, options on foreign currencies and
forward contracts are not traded on contract markets regulated by the
CFTC or (with the exception of certain foreign currency options) by
the SEC. To the contrary, such instruments are traded through
financial institutions acting as market-makers, although foreign
currency options are also traded on certain national securities
exchanges, such as the Philadelphia Stock Exchange and the Chicago
Board Options Exchange, subject to SEC regulation. Options on
currencies may be traded over-the- counter. In an over-the-counter
trading environment, many of the protections afforded to exchange
participants will not be available. For example, there are no daily
price fluctuation limits, and adverse market movements could therefore
continue to an unlimited extent over a period of time. Although the
buyer of an option cannot lose more than the amount of the premium
plus related transaction costs, this entire amount could be lost.
Moreover, an option writer and a buyer or seller of futures or forward
contracts could lose amounts substantially in excess of any premium
received or initial margin or collateral posted due to the potential
additional margin and collateral requirements associated with such
positions.
Options on foreign currencies traded on national securities exchanges
are within the jurisdiction of the SEC, as are other securities traded
on such exchanges. As a result, many of the protections provided to
traders on organized exchanges will be available with respect to such
transactions. In particular, all foreign currency option positions
entered into on a national securities exchange are cleared and
guaranteed by the OCC, thereby reducing the risk of counterparty
default. Further, a liquid secondary market in options traded on a
national securities exchange may be more readily available than in the
over-the-counter market, potentially permitting a Portfolio to
liquidate open positions at a profit prior to exercise or expiration,
or to limit losses in the event of adverse market movements.
The purchase and sale of exchange-traded foreign currency options,
however, is subject to the risks of the availability of a liquid
secondary market described above, as well as the risks regarding
adverse market movements, margining of options written, the nature of
the foreign currency market, possible intervention by governmental
authorities and the effects of other political and economic events. In
addition, exchange-traded options on foreign currencies involve
certain risks not presented by the over-the-counter market. For
example, exercise and settlement of such options must be made
exclusively through the OCC, which has established banking
relationships in applicable foreign countries for this purpose. As a
result, the OCC may, if it determines that foreign government
restrictions or taxes would prevent the orderly settlement of foreign
currency option exercises, or would result in undue burdens on the OCC
or its clearing member, impose special procedures on exercise and
settlement, such as technical changes in the mechanics of delivery of
currency, the fixing of dollar settlement prices or prohibitions on
exercise.
In addition, options on U.S. government securities, futures contracts,
options on futures contracts, forward contracts and options on foreign
currencies may be traded on foreign exchanges and over-the-counter in
foreign countries. Such transactions are subject to the risk of
governmental actions affecting trading in or the prices of foreign
currencies or securities. The value of such positions also could be
adversely affected by (i) other complex foreign political and economic
factors, (ii) lesser availability than in the United States of data on
which to make trading decisions, (iii) delays in a Portfolio's ability
to act upon economic events occurring in foreign markets during
nonbusiness hours in the United States, (iv) the imposition of
different exercise and settlement terms and procedures and margin
requirements than in the United States, and (v) low trading volume.
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OTHER INVESTMENT COMPANIES.
Certain of the Portfolios may invest in securities issued by other
investment companies, within limits described in the investment restrictions of
each Portfolio and in accordance with the 1940 Act. A Portfolio may indirectly
bear its proportionate share of any investment advisory fees and expenses paid
by the funds in which it invests, in addition to the investment advisory fee and
expenses paid by such Portfolio.
The International Equity Portfolio may not purchase securities of other
investment companies, other than a security acquired in connection with a
merger, consolidation, acquisition, reorganization or offer of exchange and
except as otherwise permitted under the 1940 Act. Investments by the
International Equity Portfolio in GEI Short-Term Investment Fund, an investment
fund advised by ^ GEIM, created specifically to serve as a vehicle for the
collective investment of cash balances of the Portfolio and other accounts
advised by GEIM or its affiliate, General Electric Investment Corporation, is
not considered an investment in another investment company for purposes of this
restriction.
ZERO COUPON, PAY-IN-KIND AND STEP COUPON SECURITIES.
Although it is the policy of the Flexible Income, Income Plus and Tactical
Asset Allocation Portfolios to invest primarily in income-producing securities,
each of the Portfolios other than the Aggressive Growth, International Equity
and Value Equity Portfolio may invest up to 10% of their assets in zero coupon,
pay-in-kind and step-coupon securities. Zero-coupon bonds are issued and traded
at a discount from their face value. They do not entitle the holder to any
periodic payment of interest prior to maturity. Step coupon bonds trade at a
discount from their face value and pay coupon interest. The coupon rate is low
for an initial period and then increases to a higher coupon rate thereafter. The
discount from the face amount or par value depends on the time remaining until
cash payments begin, prevailing interest rates, liquidity of the security and
the perceived credit quality of the issuer. Pay-in-kind bonds give the issuer an
option to pay cash at a coupon payment date or give the holder of the security a
similar bond with the same coupon rate and a face value equal to the amount of
the coupon payment that would have been made. The Flexible Income Portfolio may
also invest in "strips", which are debt securities that are stripped of their
interest after the securities are issued, but otherwise are comparable to zero
coupon bonds.
Current federal income tax law requires holders of zero-coupon securities
and step-coupon securities to report the portion of the original issue discount
on such securities that accrues that year as interest income, even though the
holders receive no cash payments of interest during the year. In order to
qualify as a "regulated investment company" under the Internal Revenue Code of
1986 ("Code"), a Portfolio must distribute its investment company taxable
income, including the original issue discount accrued on zero-coupon or
step-coupon bonds. Because it will not receive cash payments on a current basis
in respect of accrued original-issue discount on zero-coupon bonds or
step-coupon bonds during the period before interest payments begin, in some
years a Portfolio may have to distribute cash obtained from other sources in
order to satisfy the distribution requirements under the Code. A Portfolio might
obtain such cash from selling other portfolio holdings. These actions may reduce
the assets to which Portfolio expenses could be allocated and may reduce the
rate of return for such Portfolio. In some circumstances, such sales might be
necessary in order to satisfy cash distribution requirements even though
investment considerations might otherwise make it undesirable for a Portfolio to
sell the securities at the time.
Generally, the market prices of zero-coupon bonds and strip securities are
more volatile than the prices of securities that pay interest periodically and
in cash and are likely to respond to changes in interest rates to a greater
degree than other types of debt securities having similar maturities and credit
quality.
INCOME-PRODUCING SECURITIES.
As a fundamental policy, the Flexible Income Portfolio may not purchase a
non-income-producing security if, after such purchase, less than 80% of the
Flexible Income Portfolio's total assets would be invested in income-producing
securities. Income-producing securities include securities that make periodic
income payments, as well as those that make interest payments on a deferred
basis, or pay interest at maturity (as in the case with treasury bills or
zero-coupon bonds).
The Flexible Income Portfolio will purchase defaulted securities only when
its portfolio manager believes, based upon his analysis of the financial
condition, results of operations and economic outlook of an issuer, that there
is potential for resumption of income payments and that the securities offer an
unusual opportunity for capital appreciation. Notwithstanding the portfolio
28
<PAGE>
manager's belief as to the resumption of income payments, however, the purchase
of any security on which payment of interest or dividends is suspended involves
a high degree of risk. Such risk includes, among other things, the following:
A. Financial and Market Risks. Investments in securities that are in
default involve a high degree of financial and market risks that can
result in substantial or at times even total losses. Issuers of
defaulted securities may have substantial capital needs and may become
involved in bankruptcy or reorganization proceedings. Among the
problems involved in investments in such issuers is the fact that it
may be difficult to obtain information about the condition of such
issuers. The market prices of such securities also are subject to
abrupt and erratic movements and above average price volatility, and
the spread between the bid and asked prices of such securities may be
greater than normally expected.
B. Disposition of Portfolio Securities. Although the Flexible Income
Portfolio generally intends to purchase securities for which its
portfolio manager expects an active market to be maintained, defaulted
securities may be less actively traded than other securities and it
may be difficult to dispose of substantial holdings of such securities
at prevailing market prices. The Flexible Income Portfolio will limit
its holdings of any such securities to amounts that its portfolio
manager believes could be readily sold, and its holdings of such
securities would, in any event, be limited so as not to limit the
Flexible Income Portfolio's ability to readily dispose of its
securities to meet redemptions.
C. Other. Defaulted securities require active monitoring and may, at
times, require participation in bankruptcy or receivership proceedings
on behalf of the Flexible Income Portfolio.
Other types of income producing securities that the Portfolios may purchase
include, but are not limited to, the following types of securities:
Variable and Floating Rate Obligations. These types of securities are
relatively long-term instruments that often carry demand features
permitting the holder to demand payment of principal at any time or at
specified intervals prior to maturity.
Standby Commitments. These instruments, which are similar to a put,
give the Portfolios the option to obligate a broker, dealer or bank to
repurchase a security held by the Portfolios at a specified price.
Tender Option Bonds. Tender option bonds are relatively long-term
bonds that are coupled with the agreement of a third party (such as a
broker, dealer or bank) to grant the holders of such securities the
option to tender the securities to the institution at periodic
intervals.
Inverse Floaters. Inverse floaters are instruments whose interest
bears an inverse relationship to the interest rate on another
security. The Portfolios will not invest more than 5% of their
respective assets in inverse floaters.
The Portfolios will purchase instruments with demand features, standby
commitments and tender option bonds primarily for the purpose of increasing the
liquidity of their portfolios.
LENDING OF PORTFOLIO SECURITIES.
Subject to any applicable investment restriction relating to lending, each
of the Portfolios other than the Tax-Exempt Portfolio and the Income Plus
Portfolio may lend securities from its portfolio. Under applicable regulatory
requirements (which are subject to change), the following conditions apply to
securities loans: a) the loan must be continuously secured by liquid assets
maintained on a current basis in an amount at least equal to the market value of
the securities loaned; b) a Portfolio must receive any dividends or interest
paid by the issuer on such securities; c) a Portfolio must have the right to
call the loan and obtain the securities loaned at any time upon notice of not
more than five business days, including the right to call the loan to permit
voting of the securities; and d) a Portfolio must receive either interest from
the investment of collateral or a fixed fee from the borrower. Securities loaned
by a Portfolio remain subject to fluctuations in market value. A Portfolio may
pay reasonable finders, custodian and administrative fees in connection with a
loan. Securities lending, as with other extensions of credit, involves the risk
that the borrower may default. Although securities loans will be fully
collateralized at all times, a Portfolio may experience delays in, or be
prevented from, recovering the collateral. During a period that a Portfolio
seeks to enforce its rights against the borrower, the collateral and the
securities loaned remain subject to fluctuations in market value. A Portfolio
may also incur expenses in enforcing its rights. If a Portfolio has sold the
loaned security, it may not be able to settle the sale of the security and may
incur potential liability to the buyer of the security on loan for its costs to
cover the purchase. The Portfolios will not lend securities
29
<PAGE>
to any advisers or sub-advisers to the Fund or their affiliates. By lending its
securities, a Portfolio can increase its income by continuing to receive
interest or dividends on the loaned securities as well as by either investing
the cash collateral in short-term securities or by earning income in the form of
interest paid by the borrower when U.S. government securities are used as
collateral.
JOINT TRADING ACCOUNTS.
As described in the Prospectus, the Growth, Global, Flexible Income,
Balanced and Capital Appreciation Portfolios and other clients of Janus Capital
and its affiliates may place assets in joint trading accounts for the purpose of
making short-term investments in money market instruments. The Board of Trustees
of the Fund must approve the participation of each of these Portfolios in these
joint trading accounts and procedures pursuant to which the joint accounts will
operate. The joint trading accounts are to be operated pursuant to an exemptive
order issued to Janus Capital and certain of its affiliates by the SEC. All
joint account participants, including these Portfolios, will bear the expenses
of the joint trading accounts in proportion to their investments. Financial
difficulties of other participants in the joint accounts could cause delays or
other difficulties for the Portfolios in withdrawing their assets from joint
trading accounts.
ILLIQUID SECURITIES.
Each of the Aggressive Growth, Capital Appreciation, International Equity,
Global, Growth, Value Equity, C.A.S.E., ^ Strategic Total Return, Tactical Asset
Allocation, Balanced and Flexible Income Portfolios may invest up to 15%, and
each of the Tax-Exempt and Income Plus Portfolios may invest up to 10%, of its
net assets in illiquid securities (i.e., securities that are not readily
marketable). The Board of Trustees has authorized the sub-advisers to make
liquidity determinations with respect to its securities, including Rule 144A
securities, commercial paper and municipal lease obligations in accordance with
the guidelines established by the Board of Trustees. Under the guidelines, the
portfolio manager will consider the following factors in determining whether a
Rule 144A security or a municipal lease obligation is liquid: 1) the frequency
of trades and quoted prices for the security; 2) the number of dealers willing
to purchase or sell the security and the number of other potential purchasers;
3) the willingness of dealers to undertake to make a market in the security; and
4) the nature of the marketplace trades, including the time needed to dispose of
the security, the method of soliciting offers and the mechanics of the transfer.
With respect to municipal lease obligations, the portfolio managers of the
Tax-Exempt and Flexible Income Portfolios will also consider factors unique to
municipal lease obligations including the general creditworthiness of the
municipality, the importance of the property covered by the lease obligation and
the likelihood that the marketability of the obligation will be maintained
throughout the time the obligation is held by the Portfolio. The sale of
illiquid securities often requires more time and results in higher brokerage
charges or dealer discounts and other selling expenses than does the sale of
securities eligible for trading on national securities exchanges or in the
over-the-counter markets. A Portfolio may be restricted in its ability to sell
such securities at a time when the sub-advisor deems it advisable to do so. In
addition, in order to meet redemption requests, a Portfolio may have to sell
other assets, rather than such illiquid securities, at a time which is not
advantageous.
REPURCHASE AND REVERSE REPURCHASE AGREEMENTS.
Although each of the Portfolios may enter into repurchase and reverse
repurchase agreements, the Growth, C.A.S.E., Global, Flexible Income,
Tax-Exempt, ^ Strategic Total Return and Income Plus Portfolios do not intend to
invest more than 5% of their assets, the Balanced, Capital Appreciation,
Aggressive Growth and Tactical Asset Allocation Portfolios do not intend to
invest more than 15% of their assets, and the International Equity and the Value
Equity Portfolios do not intend to invest more than 25% of their assets in
either repurchase or reverse repurchase agreements. In a repurchase agreement, a
Portfolio purchases a security and simultaneously commits to resell that
security to the seller at an agreed upon price on an agreed upon date within a
number of days (usually not more than seven) from the date of purchase. The
resale price reflects the purchase price plus an agreed upon incremental amount
which is unrelated to the coupon rate or maturity of the purchased security. A
repurchase agreement involves the obligation of the seller to pay the agreed
upon price, which obligation is in effect secured by the value (at least equal
to the amount of the agreed upon resale price and marked-to-market daily) of the
underlying security or "collateral". A Portfolio may engage in a repurchase
agreement with respect to any security in which it is authorized to invest.
While it does not presently appear possible to eliminate all risks from these
transactions (particularly the possibility of a decline in the market value of
the underlying securities, as well as delays and costs to a Portfolio in
connection with bankruptcy proceedings), it is the policy of each Portfolio to
limit repurchase agreements to those parties whose creditworthiness has been
30
<PAGE>
reviewed and found satisfactory by the investment sub-adviser for that Portfolio
and approved by the Board of Trustees of the Fund. In addition, the Portfolios
currently intend to invest primarily in repurchase agreements collateralized by
cash, U.S. government securities, or money market instruments whose value equals
at least 100% of the repurchase price, marked-to-market daily.
In a reverse repurchase agreement, a Portfolio sells a portfolio instrument
to another party, such as a bank or broker-dealer, in return for cash and agrees
to repurchase the instrument at a particular price and time. While a reverse
repurchase agreement is outstanding, a Portfolio will segregate with its
custodian cash and appropriate liquid assets with the Fund's custodian to cover
its obligation under the agreement. The Portfolios will enter into reverse
repurchase agreements only with parties the investment sub-adviser for each
Portfolio deems creditworthy and that have been reviewed by the Board of
Trustees of the Fund.
PASS-THROUGH SECURITIES.
Each of the Portfolios may, in varying degrees, invest in various types of
pass-through securities, such as mortgage-backed securities, asset-backed
securities and participation interests. A pass-through security is a share or
certificate of interest in a pool of debt obligations that have been repackaged
by an intermediary, such as a bank or broker-dealer. The purchaser receives an
undivided interest in the underlying pool of securities. The issuers of the
underlying securities make interest and principal payments to the intermediary
which are passed through to purchasers, such as the Portfolios. The most common
type of pass-through securities are mortgage-backed securities. Government
National Mortgage Association ("GNMA") Certificates are mortgage-backed
securities that evidence an undivided interest in a pool of mortgage loans. GNMA
Certificates differ from traditional bonds in that principal is paid back
monthly by the borrowers over the term of the loan rather than returned in a
lump sum at maturity. A Portfolio will generally purchase "modified
pass-through" GNMA Certificates, which entitle the holder to receive a share of
all interest and principal payments paid and owned on the mortgage pool, net of
fees paid to the "issuer" and GNMA, regardless of whether or not the mortgagor
actually makes the payment. GNMA Certificates are backed as to the timely
payment of principal and interest by the full faith and credit of the U.S.
government.
The Federal Home Loan Mortgage Corporation ("FHLMC") issues two types of
mortgage pass-through securities: mortgage participation certificates ("PCs")
and guaranteed mortgage certificates ("GMCs"). PCs resemble GNMA Certificates in
that each PC represents a pro rata share of all interest and principal payments
made and owned on the underlying pool. FHLMC guarantees timely payments of
interest on PCs and the full return of principal. GMCs also represent a pro rata
interest in a pool of mortgages. However, these instruments pay interest
semi-annually and return principal once a year in guaranteed minimum payments.
This type of security is guaranteed by FHLMC as to timely payment of principal
and interest, but is not backed by the full faith and credit of the U.S.
government.
The Federal National Mortgage Association ("FNMA") issues guaranteed
mortgage pass-through certificates ("FNMA Certificates"). FNMA Certificates
resemble GNMA Certificates in that each FNMA Certificate represents a pro rata
share of all interest and principal payments made and owned on the underlying
pool. This type of security is guaranteed by FNMA as to timely payment of
principal and interest, but it is not backed by the full faith and credit of the
U.S. government.
Each of the mortgage-backed securities described above is characterized by
monthly payments to the holder, reflecting the monthly payments made by the
borrowers who received the underlying mortgage loans. The payments to the
security holders (such as a Portfolio), like the payments on the underlying
loans, represent both principal and interest. Although the underlying mortgage
loans are for specified periods of time, such as 20 or 30 years, the borrowers
can, and typically do, pay them off sooner. Thus, the security holders
frequently receive prepayments of principal in addition to the principal that is
part of the regular monthly payments. A borrower is more likely to prepay a
mortgage that bears a relatively high rate of interest. This means that in times
of declining interest rates, some of a Portfolio's higher yielding
mortgage-backed securities might be converted to cash and that Portfolio will be
forced to accept lower interest rates when that cash is used to purchase
additional securities in the mortgage-backed securities sector or in other
investment sectors. Mortgage and asset-backed securities may have periodic
income payments or may pay interest at maturity (as is the case with Treasury
bills or zero-coupon bonds).
Asset-backed securities represent interests in pools of consumer loans and
are backed by paper or accounts receivables originated by banks, credit card
companies or other providers of credit. Generally, the originating bank or
credit provider is neither the obliger or guarantor of the security and interest
and principal payments ultimately depend upon payment of the underlying loans by
individuals. Tax-exempt asset-backed securities include units of beneficial
interests in pools of purchase contracts, financing leases, and sales agreements
that may be created when a municipality enters into an installment purchase
31
<PAGE>
contract or lease with a vendor. Such securities may be secured by the assets
purchased or leased by the municipality; however, if the municipality stops
making payments, there generally will be no recourse against the vendor. The
market for tax-exempt asset-backed securities is still relatively new. These
obligations are likely to involve unscheduled prepayments of principal.
HIGH-YIELD/HIGH-RISK BONDS.
High-yield/high-risk, below investment grade securities (commonly known as
"junk bonds") involve significant credit and liquidity concerns and fluctuating
yields and are not suitable for short-term investing. Higher yields are
ordinarily available on fixed-income securities which are unrated or are rated
in the lower rating categories of recognized rating services such as Moody's and
Standard & Poor's. None of the Portfolios other than the Value Equity, ^
Strategic Total Return, Flexible Income and Income Plus Portfolios may invest
more than 5% of its net assets in junk bonds. Lower rated bonds also involve the
risk that the issuer will not make interest or principal payments when due. In
the event of an unanticipated default, a Portfolio owning such bonds would
experience a reduction in its income, and could expect a decline in the market
value of the securities so affected. More careful analysis of the financial
condition of each issuer of lower rated securities is therefore necessary.
During an economic downturn or substantial period of rising interest rates,
highly leveraged issuers may experience financial stress which would adversely
affect their ability to service their principal and interest payments
obligations, to meet projected business goals and to obtain additional
financing.
The market prices of lower grade securities are generally less sensitive to
interest rate changes than higher rated investments, but more sensitive to
adverse economic or political changes or individual developments specific to the
issuer. Periods of economic or political uncertainty and change can be expected
to result in volatility of prices of these securities. Since the last major
economic recession, there has been a substantial increase in the use of
high-yield debt securities to fund highly leveraged corporate acquisitions and
restructurings, so past experience with high-yield securities in a prolonged
economic downturn may not provide an accurate indication of future performance
during such periods. Lower rated securities also may have less liquid markets
than higher rated securities, and their liquidity as well as their value may be
more severely affected by adverse economic conditions. Adverse publicity and
investor perceptions as well as new or proposed laws may also have a greater
negative impact on the market for lower rated bonds.
Unrated securities are not necessarily of lower quality than rated
securities, but the markets for lower rated and nonrated securities are more
limited than those in which higher rated securities are traded. In addition, an
economic downturn or increase in interest rates is likely to have a greater
negative effect on the market for lower rated and nonrated securities, the value
of high yield debt securities held by a Portfolio, the new asset value of a
Portfolio holding such securities and the ability of the bonds' issuers to repay
principal and interest, meet projected business goals and obtain additional
financing than on higher rated securities.
WARRANTS AND RIGHTS.
Each of the Portfolios other than the Tax-Exempt Portfolio may invest in
warrants and rights. A warrant is a type of security that entitles the holder to
buy a proportionate amount of common stock at a specified price, usually higher
than the market price at the time of issuance, for a period of years or to
perpetuity. In contrast, rights, which also represent the right to buy common
shares, normally have a subscription price lower than the current market value
of the common stock and a life of two to four weeks.
U.S. GOVERNMENT SECURITIES.
Examples of the types of U.S. government securities that the Portfolios may
hold include, in addition to those described in the Prospectus and direct
obligations of the U.S. Treasury, the obligations of the Federal Housing
Administration, Farmers Home Administration, Small Business Administration,
General Services Administration, Central Bank for Cooperatives, Federal Farm
Credit Banks, Federal Home Loan Bank, Federal Intermediate Credit Banks, Federal
Land Banks and Maritime Administration. U.S. government securities may be
supported by the full faith and credit of the U.S. government (such as
securities of the Small Business Administration); by the right of the issuer to
borrow from the Treasury (such as securities of the Federal Home Loan Bank); by
the discretionary authority of the U.S. government to purchase the agency's
obligations (such as securities of the Federal National Mortgage Association);
or only by the credit of the issuing agency.
32
<PAGE>
PORTFOLIO TURNOVER.
PORTFOLIO 10/31/96 1996 1995 1994
- --------- -------- ---- ---- ----
AGGRESSIVE GROWTH 9.40% 127.49% 88.28% --
CAPITAL APPRECIATION 10.11% 160.72% 262.97% --
GLOBAL 2.59% 97.94% 161.48% 148.01%
GROWTH^ 9.40% 57.80% 123.26% 63.73%
C.A.S.E. 20.69% 654.49% -- --
EQUITY-INCOME 5.50% 40.58% 34.67% --
TACTICAL ASSET ALLOCATION 2.38% 56.22% -- --
BALANCED 9.08% 175.78% 82.48% --
FLEXIBLE INCOME 16.16% 135.38% 149.58% 105.40%
INCOME PLUS 1.58% 65.96% 25.07% 48.12%
TAX-EXEMPT 3.79% 71.05% 126.48% 59.84%
The estimated annual portfolio turnover rate of the International Equity
Portfolio for the fiscal year ended October 31, 1997 is expected to range
between 100% and 200%. The estimated annual portfolio turnover rate for the
Value Equity Portfolio for the fiscal year ended October 31, 1997, is expected
to average less than 50%.
As stated in the Prospectus, each of the Portfolios generally intend to
purchase and sell securities as deemed appropriate by its portfolio manager to
further the Portfolio's stated investment objective, and the rate of portfolio
turnover is not expected to be a limiting factor when changes are deemed to be
appropriate. Portfolio transactions for the Tax-Exempt Portfolio and the Income
Plus Portfolio are ordinarily undertaken to achieve each Portfolio's investment
objective in light of anticipated movements in the level of interest rates. The
investment policies of the Tax-Exempt Portfolio and the Income Plus Portfolio
may lead to frequent changes in investments, particularly in periods of rapidly
fluctuating interest rates.
These percentages are calculated by dividing the lesser of purchases or
sales of portfolio securities during the fiscal year by the monthly average of
the value of such securities (excluding from the computation all securities,
including options, with maturities at the time of acquisition of one year or
less). For example, a portfolio turnover rate of 100% would mean that all of the
Portfolio's securities (except those excluded from the calculation) were
replaced once in a period of one year. A high rate of portfolio turnover
generally involves correspondingly greater brokerage commission expenses.
Turnover rates may vary greatly from year to year as well as within a particular
year and may also be affected by cash requirements for redemptions of the
Portfolio's shares and by requirements, the satisfaction of which enable the
Portfolio to receive favorable tax treatment. Because the rate of portfolio
turnover is not a limiting factor, particular holdings may be sold at any time,
if investment judgement or portfolio operations make a sale advisable. As a
result, the annual portfolio turnover rate in future years may exceed the
percentage shown above.
INVESTMENT ADVISORY AND OTHER SERVICES
The Fund has entered into a Management and Investment Advisory Agreement
applicable to each of the Capital Appreciation, Global, Growth, Balanced and
Flexible Income Portfolios with Idex Management, Inc. ("IMI"), and applicable to
each of the Aggressive Growth, International Equity, C.A.S.E., Value Equity, ^
Strategic Total Return, Tactical Asset Allocation, Income Plus and Tax-Exempt
Portfolios with InterSecurities, Inc. ("ISI"), both located at 201 Highland
Avenue, Largo, Florida 33770-2957. These Management and Investment Advisory
Agreements are ^ collectively referred to herein as the "Advisory Agreements".
IMI and ISI supervise each respective Portfolio's investments and conducts its
investment program. Each Advisory Agreement provides that IMI and ISI will
perform the following services or cause them to be performed by others: (i)
furnish to the Portfolio investment advice and recommendations, (ii) supervise
the purchase and sale of securities as directed by appropriate Fund officers,
and (iii) be responsible for the administration of the Portfolio. For services
to each of its respectively advised Portfolios, IMI receives an annual fee,
computed daily and paid monthly, equal to 1.00% of the first $750 million of
that
33
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Portfolio's average daily net assets, 0.9% of the next $250 million of that
Portfolio's average daily net assets, and 0.8% of the average daily net assets
of that Portfolio in excess of $1 billion. For services to the Tax-Exempt and
Income Plus Portfolios, ISI receives an annual fee of .60% of each Portfolio's
average daily net assets computed and paid on a monthly basis. For services to
each of its other respectively advised Portfolios, ISI receives an annual fee,
computed daily and paid monthly, equal to 1.00% of the first $750 million of
that Portfolio's average daily net assets, 0.9% of the next $250 million of that
Portfolio's average daily net assets, and 0.8% of the average daily net assets
of the Portfolio in excess of $1 billion.
The duties and responsibilities of the investment adviser are specified in
the Advisory Agreements. The Agreements were approved by the board of Trustees
of the Fund (including a majority of trustees who are not parties to the
Agreement or interested persons, as defined by the 1940 Act, of any such party.)
The Agreements are not assignable and may be terminated without penalty upon 60
days written notice at the option of either the Fund, IMI, ISI or by a vote of
shareholders of each Portfolio. Each provides that it can be continued from year
to year so long as such continuance is specifically approved annually (a) by the
Board of Trustees of the Fund or by a majority of the outstanding shares of the
Portfolio and (b) by a majority vote of the Trustees who are not parties to the
Agreement or interested persons of any such party cast in person at a meeting.
The Agreements also provide that IMI and ISI shall not be liable to the
Fund or to any shareholder for any error of judgment or mistake of law or for
any loss suffered by the Fund or by any shareholder in connection with matters
to which the Agreements relate, except for a breach of fiduciary duty or a loss
resulting from willful misfeasance, bad faith, gross negligence, or reckless
disregard on the part of IMI or ISI in the performance of its duties thereunder.
The Advisory Agreements became effective as follows: Aggressive Growth -
September 30, 1994; International Equity - ^ February 1, 1997; Capital
Appreciation - September 30, 1994; Global - April 22, 1992; Growth - April 22,
1991; C.A.S.E. - November 15, 1995; Value Equity - October 30, 1996; ^ Strategic
Total Return - September 30, 1994; Tactical Asset Allocation -June 1, 1995;
Balanced - September 30, 1994; Flexible Income - August 5, 1993; Income Plus -
April 22, 1992; and Tax-Exempt - April 22, 1992.
Each Portfolio pays its allocable share of the fees and expenses of the
Fund's non-interested trustees, custodian and transfer agent fees, brokerage
commissions and all other expenses in connection with the execution of its
portfolio transactions, administrative, clerical, recordkeeping, bookkeeping,
legal, auditing and accounting expenses, interest and taxes, expenses of
preparing tax returns, expenses of shareholders' meetings and preparing,
printing and mailing proxy statements (unless otherwise agreed to by the Fund,
IMI or ISI), expenses of preparing and typesetting periodic reports to
shareholders (except for those reports the Portfolio permits to be used as sales
literature), and the costs, including filing fees, of renewing or maintaining
registration of Portfolio shares under federal and state law. The respective
investment adviser will reimburse a Portfolio, or waive fees, or both, whenever,
in any fiscal year, the total cost to a Portfolio of normal operating expenses
chargeable to its income account, including the investment advisory fee but
excluding brokerage commissions, interest, taxes and 12b-1 fees, exceeds, in the
case of the Aggressive Growth, Capital Appreciation, Global, Growth, C.A.S.E., ^
Strategic Total Return, Tactical Asset Allocation, Balanced and Flexible Income
Portfolios, 1.5% of each Portfolio's average daily net assets; in the case of
the Tax-Exempt and Income Plus Portfolios, 0.65% and 1.25% of the Portfolio's
average daily net assets, respectively; in the case of the Value Equity
Portfolio, 1.15% for the first nine months of the Portfolio's operations and
1.50% thereafter; and in the case of the International Equity Portfolio, 1.35%
for the first nine months of the Portfolio's operations and 1.50% thereafter.
34
<PAGE>
INVESTMENT ADVISORY FEES
<TABLE>
<CAPTION>
ADVISORY FEES ^ AFTER REIMBURSEMENT ADVISORY FEE ^ REIMBURSEMENTS
September 30 September 30
------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Portfolio Advisor 10/31/96 1996 1995 1994 10/31/96 1996 1995 1994
Aggressive Growth ISI $5,163 $56,761 $30,629 -- $17,394 $169,995 $31,402 --
Capital Appreciation IMI $7,502 $19,350 $(11,865) -- $12,709 $122,710 $55,475 --
Global IMI $126,856 $1,130,757 $873,921 $558,189 -- -- -- --
Growth IMI $952,996 $5,459,981 $4,292,430 $4,949,754 -- -- -- --
C.A.S.E. ISI $(11,137) $(36,998) -- -- $13,949 $55,165 -^- --
Strategic Total
Return ISI $1,140 $5,591 $(14,695) -- $11,492 $92,079 $39,831 --
Tactical Asset
Allocation ISI $2,983 $53,542 -- -- $11,829 $28,453 -- --
Balanced IMI $(4,993) $(21,773) $(17,689) -- $13,490 $106,223 $49,201 --
Flexible Income IMI $(3,566) $133,035 $169,696 $136,806 $17,675 $41,410 $16,128 $98,496
Income Plus ISI $35,332 $414,023 $402,031 $421,791 -- -- -- --
Tax-Exempt ISI $(6,243) $35,970 $78,055 $65,782 $19,367 $123,530 $91,270 $115,553
</TABLE>
No investment advisory fees were paid by the International Equity and Value
Equity Portfolios for the one-month period ended October 31, 1996 and the fiscal
year ended September 30, 1996, as those Portfolios had not yet commenced
operations.
IMI has entered into an Investment Counsel Agreement applicable to each of
the Capital Appreciation, Global, Growth, Balanced and Flexible Income
Portfolios, respectively, wherein Janus Capital Corporation ("Janus Capital"),
100 Fillmore Street, Denver, CO 80206, serves as the investment sub-adviser to
each of these Portfolios. The Investment Counsel Agreement for the Growth
Portfolio became effective April 22, 1991, the Global Portfolio's Investment
Counsel Agreement became effective April 22, 1992, the Flexible Income
Portfolio's Investment Counsel Agreement became effective August 5, 1993, and
the Balanced and Capital Appreciation Portfolios' respective Investment Counsel
Agreements were ^ entered into as of September 30, 1994.
Fred Alger Management, Inc. ("Alger Management"), 75 Maiden Lane, New York,
NY 10038, serves as the investment sub-adviser to the Aggressive Growth
Portfolio pursuant to an Investment Counsel Agreement dated as of September 30,
1994 with ISI. Luther King Capital Management Corporation ("Luther King"), 301
Commerce Street, Suite 1600, Fort Worth, TX 76102, serves as the investment
sub-adviser to the ^ Strategic Total Return Portfolio pursuant to an Investment
Counsel Agreement dated as of September 30, 1994 with ISI. Dean Investment
Associates ("Dean Investment"), a Division of C.H. Dean and Associates, Inc.,
2480 Kettering Tower, Dayton, Ohio 45423-2480 serves as the investment
sub-adviser to the Tactical Asset Allocation Portfolio pursuant to an Investment
Counsel Agreement dated as of June 30, 1995 with ISI. C.A.S.E. Management, Inc.
("C.A.S.E."), 2255 Glades Road, Suite 221-A, Boca Raton, FL 33431, serves as the
investment sub-adviser to the C.A.S.E. Portfolio pursuant to an Investment
Counsel Agreement dated November 15, 1995 with ISI. NWQ Investment Management
Company, Inc. ("NWQ"), 655 South Hope Street, 11th Floor, Los Angeles, CA 90017,
serves as the investment sub-adviser to the Value Equity Portfolio pursuant to
an Investment Counsel Agreement dated October 30, 1996 with ISI. Scottish
Equitable Investment Management Limited ("Scottish Equitable"), Edinburgh Park,
Edinburgh EH12 9SE, Scotland, and GEIM, 3003 Summer Street, Stamford, CT 06905,
serve as the investment sub-advisers to the International Equity Portfolio
pursuant to ^ respective Investment Counsel Agreements dated ^ February 1, 1997
with ISI.
AEGON USA Investment Management, Inc. ("AEGON Management"), 4333 Edgewood
Road, N.E., Cedar Rapids, Iowa 52499, serves as the investment sub-adviser to
the Tax-Exempt Portfolio and the Income Plus Portfolio pursuant to an Investment
Counsel Agreement relating to each Portfolio. Each Investment Counsel Agreement
was entered into between ISI and AEGON Securities which assigned each Agreement
to AEGON Management, the parent of AEGON Securities, on September 30, 1992.
AEGON Management is a wholly-owned indirect subsidiary of AEGON USA and thus is
an affiliate of ISI and IMI.
35
<PAGE>
Further discussions of the basic fee arrangements and allocation of
responsibilities relating to terms of the ^ Investment Counsel Agreements for
each Portfolio are set forth in the Prospectus. Alger Management, Scottish
Equitable, GEIM, Janus Capital, C.A.S.E., NWQ, Luther King, Dean Investment and
AEGON Management also serve as sub-advisers to certain portfolios of the WRL
Series Fund, Inc., a registered investment company. They may be referred to
herein collectively as the "sub-advisers" and individually as a "sub-adviser."
SUB-ADVISORY FEES
^(NET OF FEES REIMBURSED)
SEPTEMBER 30
PORTFOLIO 10/31/96 1996 1995 1994
Aggressive Growth $2,065 $22,704 $12,252 --
Capital Appreciation $3,751 $9,675 -- --
Global $63,428 $565,378 $436,960 $279,094
Growth $476,498 $2,729,990 $2,146,215 $2,474,877
C.A.S.E. -- -- -- --
Strategic Total Return $456 $2,236 -- --
Tactical Asset Allocation $1,193 $21,417 -- --
Balanced -- -- -- --
Flexible Income -- $66,517 $84,848 $68,403
Income Plus $17,666 $207,011 $201,015 $210,895
Tax-Exempt -- $17,985 $39,027 $32,891
No investment sub-advisory fees were assessed for the Value Equity and
International Equity Portfolios for the one-month period ended October 31, 1996
and the fiscal year ended September 30, 1996, as those Portfolios had not yet
commenced operations.
ADDITIONAL INVESTMENT ADVISORY OR SUB-ADVISORY SERVICES PROVIDED BY THE
SUB-ADVISERS
The Investment Counsel Agreements between IMI and Janus Capital provide for
additional compensation to be paid by IMI to Janus Capital as follows: If on
December 31 ^, 1996, and December 31 of each year thereafter ("Target Date") the
aggregate actual net assets on that date of the Fund and any other registered
investment company sponsored by IMI, containing the name IDEX or with respect to
which IMI acts as investment adviser or administrator, and to which Janus
Capital provides investment advice (the "Advised Funds") are less than the
applicable Target Net Assets specified in Table 1 below, then IMI shall pay to
Janus Capital a percentage, as specified in Table 2 below, of the Net Fee
otherwise payable to ISI, or any other affiliate of IMI serving as administrator
to the Fund for the calendar year following such date (the "Administrator").
TABLE 1
TARGET DATE ADVISED FUNDS TARGET NET ASSETS
------ ---- -------------------------------
December 31, 1996 $950 million
(and December 31 of each year thereafter)
The Net Fee of the Administrator shall be the fee received by the
Administrator from IMI less any reimbursement from the Administrator in
connection with any applicable expense limitation. The percentage of the Net Fee
so payable to Janus Capital shall be determined by the percentage that on the
applicable Target Date the aggregate actual net assets of the Advised Funds are
less than the applicable Target Net Assets of the Advised Funds ("Shortfall of
Target") in accordance with Table 2 below:
36
<PAGE>
TABLE 2
SHORTFALL OF TARGET PERCENTAGE OF NET FEE
5% - 10% .....................................................10%
Over 10% - 20% ...............................................20%
Over 20% - 30% ...............................................30%
Over 30% .....................................................40%
No additional fees shall be payable to Janus Capital for any year if, for
the five-year period ending December 31 of the preceding year, the respective
total returns of a majority of the Advised Funds that have the objective of
investing primarily in equity securities with such a five-year record (and with
respect to which Janus Capital shall have provided investment advice for all of
such five years and for the then current year), which in 1996 were IDEX Fund,
IDEX Growth, Global, Flexible Income, Balanced and Capital Appreciation
Portfolios and IDEX Fund 3, are not in the top one-third of their respective
fund categories as determined by Lipper Analytical Services, Inc. or its
successor (or if no successor exists, by a mutually agreed upon statistical
service). No additional fees were payable by IMI to Janus Capital for 1996
because Advised Funds Target Net Assets exceeded $950 million on December 31,
1996.
IMI and Janus Capital also served as investment adviser and sub-adviser,
respectively, to certain other funds in the IDEX Group, IDEX Fund and IDEX Fund
3, which were reorganized into Class T shares of IDEX Growth Portfolio on
September 20, 1996. Janus Capital has served as investment adviser to Janus Fund
since 1970 and currently serves as investment adviser to each portfolio of the
Janus Investment Fund and Janus Aspen Series as well as sub-adviser to other
mutual funds. Janus Capital also serves as investment adviser to individual,
corporate, charitable and retirement accounts. Janus Capital managed
approximately ^ $46 billion in assets as of December 31, 1996.
Janus Capital and AUSA Holding Company ("AUSA") each own 50% of the
outstanding stock of IMI. AUSA also owns 100% of the outstanding shares of the
Fund's distributor and transfer agent. AUSA is wholly-owned by AEGON USA, Inc.,
a financial services holding company located at 4333 Edgewood Road, N.E., Cedar
Rapids, Iowa 52499. AEGON USA, Inc. is a wholly-owned indirect subsidiary of
AEGON nv, a Netherlands corporation and publicly traded international insurance
group. Kansas City Southern Industries, Inc. ("KCSI") owns approximately 83% of
Janus Capital, most of which it acquired in 1984. Thomas H. Bailey, President
and Chairman of the Boards of Janus Capital and IMI, owns approximately 12% of
Janus Capital's voting stock and, by agreement with KCSI, selects a majority of
Janus Capital's Board. KCSI, whose address is 114 West 11th Street, Kansas City,
Missouri 64105-1804, is a publicly traded holding company whose primary
subsidiaries are engaged in transportation and financial services.
Alger Management provides investment advisory services to ISI for the
Aggressive Growth Portfolio. Scottish Equitable and GEIM provide investment
advisory services to ISI for the International Equity Portfolio. Janus Capital
provides investment advisory services to IMI for the Capital Appreciation,
Global, Growth, Balanced and Flexible Income Portfolios. C.A.S.E. provides
investment advisory services to ISI for the C.A.S.E. Portfolio. NWQ provides
investment advisory services to ISI for the Value Equity Portfolio. Luther King
provides investment advisory services to ISI for the ^ Strategic Total Return
Portfolio. Dean Investment provides investment advisory services to ISI for the
Tactical Asset Allocation Portfolio. AEGON Management provides investment
advisory services to ISI for the Income Plus and Tax-Exempt Portfolios. Each of
the sub-advisers also serves as investment adviser or sub-adviser to other funds
and/or private accounts which may have investment objectives identical or
similar to that of the Portfolios. Securities frequently meet the investment
objectives of one or all of these Portfolios, the other funds and the private
accounts. In such cases, a sub-adviser's decision to recommend a purchase to one
fund or account rather than another is based on a number of factors. The
determining factors in most cases are the amounts available for investment by
each fund or account, the amount of securities of the issuer then outstanding,
the value of those securities and the market for them. Another factor considered
in the investment recommendations is other investments which each fund or
account presently has in a particular industry.
It is possible that at times identical securities will be held by more than
one fund or account. However, positions in the same issue may vary and the
length of time that any fund or account may choose to hold its investment in the
same issue may likewise vary. To the extent that more than one of the funds or
private accounts served by a sub-adviser seeks to acquire or sell the same
security at about the same time, either the price obtained by the Portfolios or
the amount of securities that may be purchased or sold by a Portfolio at one
time may be adversely affected. On the other hand, if the same securities are
bought or
37
<PAGE>
sold at the same time by more than one fund or account, the resulting
participation in volume transactions could produce better executions for the
Portfolios. In the event more than one fund or account purchases or sells the
same security on a given date, the purchase and sale transactions are allocated
among the Portfolio(s), the other funds and the private accounts in a manner
believed by the sub-advisers to be equitable to each.
DISTRIBUTOR
The Fund has entered into an Underwriting Agreement with ISI to act as the
principal underwriter of Fund shares. The Underwriting Agreement will continue
from year to year so long as its continuance is approved at least annually in
the same manner as the Investment Advisory Agreements discussed above. A
discussion of ISI's responsibilities and charges as principal underwriter of
Fund shares is set forth in the Prospectus.
UNDERWRITING COMMISSIONS
<TABLE>
<CAPTION>
COMMISSIONS RECEIVED COMMISSIONS RETAINED
SEPTEMBER 30 SEPTEMBER 30
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PORTFOLIO 10/31/96 1996 1995 1994 10/31/96 1996 1995 1994
Aggressive Growth $25,967 $479,802 $228,229 -- $3,677 $65,924 $33,478 --
Capital Appreciation $47,565 $395,205 $73,332 -- $8,052 $60,768 $10,921 --
Global $150,015 $938,340 $491,761 $1,202,555 $20,964 $139,197 $73,278 $102,320
Growth $191,780 $2,033,743 $1,155,639 $2,389,332 $28,146 $296,565 $167,446 $346,753
C.A.S.E. $4,356 $36,903 -- -- $642 $5,443 -- --
Strategic Total
Return $19,972 $234,546 $90,604 -- $3,617 $35,552 $14,667 --
Tactical Asset
Allocation $22,282 $200,817 -- -- $2,742 $30,970 -- --
Balanced $13,157 $128,544 $61,824 -- $2,118 $20,474 $10,074 --
Flexible Income $2,509 $36,139 $28,794 $66,672 $444 $5,837 $5,736 $12,453
Income Plus $7,845 $167,267 $142,265 $285,345 $1,393 $29,744 $26,821 $52,998
Tax-Exempt $2,189 $50,307 $22,502 $73,000 $410 $8,771 $4,491 $14,193
</TABLE>
No underwriting commissions were received or retained on the sale of Value
Equity or International Equity Portfolio shares for the one-month period ended
October 31, 1996 and the fiscal year ended September 30, 1996, as those
Portfolios had not yet commenced operations.
ADMINISTRATIVE SERVICES
Each of IMI and ISI, with respect to the Portfolios they advise, is
responsible for the supervision all of the administrative functions, providing
office space, and paying its allocable portion of the salaries, fees and
expenses of all Fund officers and of those trustees who are affiliated with IMI
and ISI. The costs and expenses, including legal and accounting fees, filing
fees and printing costs in connection with the formation of the Fund and the
preparation and filing of the Fund's initial registration statements under the
1933 Act and 1940 Act are also paid by the advisor.
IMI has entered into an Administrative Services Agreement ("Administrative
Agreement") with ISI applicable to each of the Capital Appreciation, Global,
Growth, Balanced and Flexible Income Portfolios. Under each Administrative
Agreement, ISI carries out and supervises all of the administrative functions of
the Portfolio and incurs IMI's expenses related to such functions. The basic fee
arrangement and allocation of responsibilities is set forth in the Prospectus.
The amount payable to ISI under the Administrative Agreement will be reduced to
the extent that additional compensation is paid by IMI to Janus Capital, as
described above under "Additional Investment Advisory or Sub-Advisory Services
Provided by the Sub-Advisers."
38
<PAGE>
The administrative duties of ISI with respect to each Portfolio include:
providing the Portfolio with office space, telephones, office equipment and
supplies; paying the compensation of the Fund's officers for services rendered
as such; supervising and assisting in preparation of annual and semi-annual
reports to shareholders, notices of dividends, capital gain distributions and
tax information; supervising compliance by the Fund with the recordkeeping
requirements under the 1940 Act and regulations thereunder and with the state
regulatory requirements; maintaining books and records of the Portfolio (other
than those maintained by the Fund's custodian and transfer agent); preparing and
filing tax returns and reports; monitoring and supervising relationships with
the Fund's custodian and transfer agent; monitoring the qualifications of tax
deferred retirement plans providing for investment in shares of the Portfolio;
authorizing expenditures and approving bills for payment on behalf of the
Portfolio; and providing executive, clerical and secretarial help needed to
carry out its duties.
CUSTODIAN, TRANSFER AGENT AND OTHER AFFILIATES
Investors Fiduciary Trust Company ("IFTC"), 127 West 10th Street, Kansas
City, Missouri 64105, is Custodian for the Fund. The Custodian is in no way
responsible for any of the investment policies or decisions of a Portfolio, but
holds its assets in safekeeping and collects and remits the income thereon
subject to the instructions of the Fund.
Idex Investor Services, Inc., P. O. Box 9015, Clearwater, Florida
34618-9015, is the Fund's transfer agent, withholding agent and dividend
disbursing agent. Idex Investor Services, Inc. is a wholly-owned subsidiary of
AUSA Holding Company and thus is an affiliate of IMI, ISI and AEGON Management.
Each Portfolio pays the transfer agent an annual per-account charge of $15.10
for each of its shareholder accounts in existence, $2.63 for each new account
opened and $1.57 for each closed account.
DST, provider of data processing and recordkeeping services for the Fund's
transfer agent, is a partially-owned subsidiary of KCSI and, thus, is an
affiliate of IMI and Janus Capital. Each Portfolio may use another affiliate of
DST as introducing broker for certain portfolio transactions as a means to
reduce expenses through a credit against transfer agency fees with regard to
commissions earned by such affiliate. (See "Portfolio Transactions and
Brokerage.")
TRANSFER AGENCY FEES
<TABLE>
<CAPTION>
FEES AND EXPENSES NET OF BROKERAGE CREDITS BROKERAGE CREDITS RECEIVED
SEPTEMBER 30 SEPTEMBER 30
------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PORTFOLIO 10/31/96 1996 1995 1994 10/31/96 1996 1995 1994
Aggressive Growth $15,460 $141,668 $27,772 -- -- -- -- --
Capital Appreciation $9,740 $61,086 $22,570 -- -- -- $8 --
Global $46,880 $379,409 $341,591 $34,294 -- -- $323 $222
Growth $273,000 $1,537,321 $174,068 $1,523,083 -- -- -- $12,039
C.A.S.E. $2,260 $8,930 -- -- -- -- -- --
Strategic Total
Return $5,772 $40,189 $10,668 -- -- -- -- --
Tactical Asset
Allocation $6,084 $25,499 -- -- -- -- -- --
Balanced $3,500 $26,374 $9,905 -- -- -- -- --
Flexible Income $8,624 $51,078 $53,822 $60,995 -- -- -- --
Income Plus $10,000 $113,654 $118,821 $152,834 -- -- -- --
Tax-Exempt $4,250 $40,367 $35,084 $40,702 -- -- -- --
</TABLE>
No custodian or transfer agency fees and expenses were incurred by the
Value Equity and International Equity Portfolios for the one-month period ended
October 31, 1996 and the fiscal year ended September 30, 1996, as those
Portfolios had not yet commenced operations.
39
<PAGE>
PORTFOLIO TRANSACTIONS AND BROKERAGE
Decisions as to the assignment of portfolio business for each of the
Portfolios and negotiation of its commission rates are made by its sub-adviser,
whose policy is to obtain the "best execution" (prompt and reliable execution at
the most favorable security price) of all portfolio transactions. The Advisory
Agreement and Investment Counsel Agreement of each Portfolio specifically
provide that in placing portfolio transactions for each of the Portfolios, the
sub-adviser may agree to pay brokerage commissions for effecting a securities
transaction in an amount higher than another broker or dealer would have charged
for effecting that transaction as authorized, under certain circumstances, by
the Securities Exchange Act of 1934.
In selecting brokers and dealers and in negotiating commissions, a
sub-adviser considers a number of factors, including but not limited to: the
sub-adviser's knowledge of currently available negotiated commission rates or
prices of securities and other current transaction costs; the nature of the
security being traded; the size and type of the transaction; the nature and
character of the markets for the security to be purchased or sold; the desired
timing of the trade; the activity existing and expected in the market for the
particular security; the quality of the execution, clearance and settlement
services; financial stability; the existence of actual or apparent operational
problems of any broker or dealer; and research products and services provided.
In recognition of the value of the foregoing factors, the sub-adviser may place
portfolio transactions with a broker with whom it has negotiated a commission
that is in excess of the commission another broker would have charged for
effecting that transaction if the sub-adviser determines in good faith that such
amount of commission was reasonable in relation to the value of the brokerage
and research provided by such broker viewed in terms of either that particular
transaction or of the overall responsibilities of the sub-adviser. Research
provided may include: furnishing advice, either directly or through publications
or writings, as to the value of securities, the advisability of purchasing or
selling specific securities and the availability of securities or purchasers or
sellers of securities; furnishing seminars, information, analyses and reports
concerning issuers, industries, securities, trading markets and methods,
legislative developments, changes in accounting practices, economic factors and
trends and portfolio strategy; access to research analysts, corporate management
personnel, industry experts, economists and government officials; comparative
performance evaluation and technical measurement services and quotation
services, and other services (such as third party publications, reports and
analyses, and computer and electronic access, equipment, software, information
and accessories that deliver process or otherwise utilize information, including
the research described above) that assist the sub-adviser in carrying out its
responsibilities. Most brokers and dealers used by the sub-advisers provide
research and other services described above.
The sub-adviser may use research products and services in servicing other
accounts in addition to the Portfolio. If the sub-adviser determines that any
research product or service has a mixed use, such that it also serves functions
that do not assist in the investment decision-making process, the sub-adviser
may allocate the costs of such service or product accordingly. The portion of
the product or service that the sub-adviser determines will assist it in the
investment decision-making process may be paid for in brokerage commission
dollars. Such allocation may be a conflict of interest for the sub-adviser.
When a Portfolio purchases or sells a security in the over-the-counter
market, the transaction takes place directly with a principal market-maker,
without the use of a broker, except in those circumstances where better prices
and executions will be achieved through the use of a broker.
The sub-adviser may also consider the sale or recommendation of a
Portfolio's shares by a broker or dealer to its customers as a factor in the
selection of brokers or dealers to execute portfolio transactions. In placing
portfolio business with broker or dealers, the sub-adviser will seek the best
execution of each transaction and all such brokerage placement must be
consistent with the Rules of Fair Practice of the National Association of
Securities Dealers, Inc.
The sub-adviser may place transactions for the purchase or sale of
portfolio securities with affiliates of IMI, ISI or the sub-adviser, including
DST Securities, Inc., ISI or Fred Alger & Company, Incorporated. It is
anticipated that Fred Alger & Company, Incorporated, an affiliate of Alger
Management, will serve as the Aggressive Growth Portfolio's broker in effecting
substantially all of the Aggressive Growth Portfolio's transactions on
securities exchanges and will retain commissions in accordance with certain
regulations of the Securities and Exchange Commission. The sub-adviser may place
transactions if it reasonably believes that the quality of the transaction and
the associated commission are fair and reasonable and if, overall, the
associated transaction costs, net of any credits described above under
"Custodian, Transfer Agent and Other Affiliates," are lower than those that
would otherwise be incurred. Under rules adopted by the Securities and Exchange
Commission, the Fund's Board of Trustees will conduct periodic compliance
reviews of such brokerage allocations and review certain procedures adopted by
the Board of Trustees to ensure compliance with these rules as often as
necessary to determine their continued appropriateness. For the one-month period
ended October 31, 1996 and the fiscal year ended September 30, 1996 the ^
Aggressive Growth Portfolio paid the following commissions to ^ Fred Alger &
Company, Incorporated:
40
<PAGE>
COMMISSIONS PAID: Fred Alger &
Company, Incorporated
10/31/96 09/30/96
Fiscal 1996 $4,711 $42,819
Fiscal 1996 Percentages: 91.4% 98.2%
Commissions with affiliates
to total commissions
Value of brokerage transactions with
affiliates to total brokerage 92.7% 98.8%
transactions
^ BROKERAGE COMMISSIONS
<TABLE>
<CAPTION>
BROKERAGE COMMISSIONS PAID AGGRESSIVE CAPITAL STRATEGIC
(including Affiliated Brokerage) GROWTH APPRECIATION GLOBAL GROWTH C.A.S.E. TOTAL RETURN
<S> <C> <C> <C> <C> <C> <C>
October 31, 1996 $5,156 $14,114 $9,638 $34,732 $3,469 $2,089
September, 1996 $43,591 $109,526 $109,328 $314,230 $50,714 $16,340
September, 1995 $19,568 $41,182 $124,068 $930,417 -- $9,661
September, 1994 -- -- $61,311 $607,482 -- --
AFFILIATED BROKERAGE PAID
October 31, 1996 $4,711 -- -- -- -- --
September, 1996 $42,819 -- -- -- -- --
September, 1995 $18,944 $11 $431 -- -- --
September, 1994 -- -- $296 $16,052 -- --
</TABLE>
<TABLE>
<CAPTION>
TACTICAL ASSET
BROKERAGE COMMISSIONS PAID ALLOCATION BALANCED FLEXIBLE INCOME INCOME PLUS TAX-EXEMPT
(including Affiliated Brokerage)
<S> <C> <C> <C> <C> <C>
October 31, 1996 $2,800 $1,291 -- -- --
September, 1996 $34,335 $37,881 $27,515 -- --
September, 1995 -- $9,193 $1,853 -- --
September, 1994 -- -- $2,963 -- --
AFFILIATED BROKERAGE PAID
October 31, 1996 -- -- -- -- --
September, 1996 -- -- -- -- --
September, 1995 -- -- -- -- --
September, 1994 -- -- -- -- --
</TABLE>
No brokerage commissions were paid on the purchase or sale of Value Equity
or International Equity Portfolio shares for the one-month period ended October
31, 1996 and the fiscal year ended September 30, 1996, as those Portfolios had
not yet commenced operations.
41
<PAGE>
During ^ the fiscal year ended September 30, 1996, Growth, Global, ^
Balanced, Capital Appreciation ^, Strategic Total Return, Tactical Asset
Allocation and C.A.S.E. Portfolios had transactions in the amounts of ^
$302,630, $69,535, $14,546, $46,367, $184,125, $54,341,341, and $31,674,394,
respectively, which resulted in brokerage commission of ^ $24,095, $1,589,
$1,360, $2,165, $590, $34,444 and $50,714, respectively, that were directed to
brokers for brokerage and research services provided.
During the one-month period ended October 31, 1996, Global, Balanced,
Strategic Total Return, Tactical Asset Allocation and C.A.S.E. Portfolios had
transactions in the amounts of $9,838, $1,153, $145,192, $9,001, $665 and
$14,220,018, respectively, which resulted in brokerage commissions of $32, $11,
$240, $3,360 and $3,469, respectively, that were directed to brokers for
brokerage and research services provided.
TRUSTEES AND OFFICERS
- ----------
Peter R. Brown
1475 Belcher Road South
Largo, FL 34640
05/10/28
Trustee of IDEX Series Fund;^ Director of WRL Series Fund, Inc. (investment
company); Chairman of the Board of Peter Brown Construction Co., Largo, FL
(construction, contractors and engineers); Rear Admiral (Retired), U.S. Navy
Reserve, Civil Engineer Corps.
- ----------
Daniel Calabria
7120 S. Shore Drive
South Pasadena, FL 33707
03/05/36
Trustee ^ of IDEX Series Fund; ^ Trustee (1993 - present) and President (1993 -
1995) of The Florida Tax Free Funds (mutual funds); Director (1996-present) of
ASM Fund (mutual fund); currently retired; formerly President and Director
(1995) of Sun Chiropractic Clinics, Inc. (medical services); Executive Vice
President (1993 - 1995) of William R. Hough & Co. (investment adviser, municipal
bond and underwriting firm); President/CEO (1986-1992) of Templeton Fund
Management, Inc. (investment advisers); and Vice President (1986-1992) of all
U.S. Templeton Funds (mutual funds).
- ----------
James L. Churchill
12 Lavington Road
Long Cove
Hilton Head, SC 29928
05/07/30
Trustee of IDEX Series Fund; ^ currently retired; formerly, President (1981 -
1990) and Executive Vice President (1979 - 1981) of the Avionics Group of
Rockwell International Corporation, Cedar Rapids, Iowa (supplier of aviation
electronics).
- ----------
Becky A. Ferrell(2)
12/10/60
Vice President (September 1995 - present), Assistant Vice President (March 1994
- - September 1995), Counsel and Secretary (March 1994 - present) of IDEX Series
Fund; former Vice President, Counsel and Secretary of IDEX Fund and IDEX Fund 3;
Vice President (September 1995 - present), Assistant Vice President (March 1994
- - September 1995), and Secretary (March 1994 - present) WRL Series Fund, Inc.
(investment company); Assistant Vice President, Counsel and Assistant Secretary
of InterSecurities, Inc. (March 1994 - present) (broker-dealer); Attorney
(August 1993 - present), Western Reserve Life Assurance Co. of Ohio (life
insurance); Attorney, Hearne, Graziano, Nader & Buhr, P.A. (September 1992 -
August 1993) (law firm); Legal Writing Instructor, Florida State University
College of Law (August 1991 - June 1992) (law school); Teaching Assistant,
English, University of South Florida (August 1990 - July 1991) (university);
Associate Attorney, Johnson, Blakely, Pope, Bokor, Ruppel Burns, P.A. (August
1989 - July 1990) (law firm); Attorney, Schifino, Fleischer & Neal, P.A. (August
1986 - August 1989) (law firm); Attorney, Trenam, Simmons, Kemker, Scharf,
Barkin, Frye & O'Neill, P.A. (August 1984 - August 1986) (law firm).
42
<PAGE>
^----------
William H. Geiger(2)
06/01/47
Vice President (November 1990 to present), Secretary (June 1990 to March 1994)
and Assistant Secretary (March 1994 to present) of IDEX Series Fund; former Vice
President and Assistant Secretary of IDEX Fund and IDEX Fund 3; Secretary (June
1990 to March 1994) and Assistant Secretary (March 1994 to present) of WRL
Series Fund, Inc. (investment company); Senior Vice President, Secretary and
General Counsel (July 1990 to present) of Western Reserve Life Assurance Co. of
Ohio (life insurance); Secretary (November 1990 to present) of Idex Management,
Inc. (investment adviser); Secretary (May 1990 to present) and Director (April
1991 to present) of InterSecurities, Inc. (broker-dealer); Secretary (September
1992 to present) of ISI Insurance Agency, Inc.; Secretary (May 1990 to present)
of Idex Investor Services, Inc. (transfer agent); Vice President, Secretary and
General Counsel (May 1990 to February 1991) of Pioneer Western Corporation and
Secretary of its subsidiaries (financial services); Secretary and General
Counsel (March 1980 to April 1990) of Orange State Life and Health Insurance
Company and its affiliates (life and health insurance).
- ----------
Ronald L. Hall (2)
12-05-48
Senior Vice President, Sales and Marketing (September 1996 to present) of IDEX
Series Fund; Vice President (November 1995 to Present) of InterSecurities, Inc.;
Regional Marketing Director (March 1995 to November 1995) of Western Reserve
Life Assurance Co. of Ohio; President (March 1991 to March 1995) of Herzfeld
Hall & Associates, Inc./MCC Securities, Inc.; Vice President (November 1987 to
March 1991) of Western Reserve Life Assurance Co. of Ohio.
- ---------
Charles C. Harris
35 Winston Drive
Belleair, FL 34616
07/15/30
Trustee of IDEX Series Fund;^ Director (March 1994 - present) of WRL Series
Fund, Inc. (investment company); currently retired (1988 - present); Senior Vice
President, Treasurer (1966 - 1988), Western Reserve Life Assurance Co. of Ohio
(life insurance); Vice President, Treasurer (1968 - 1988), Director (1968 -
1987), Pioneer Western Corporation (financial services); Vice President of WRL
Series Fund, Inc. (1986 - December 1990) (investment company).
- ---------
G. John Hurley(2)
09/12/48
President and Chief Executive Officer (September 1990 to present), Trustee (June
1990 to present) and Executive Vice President (June 1988 to September 1990) of
IDEX Series Fund; former President and Chief Executive Officer and Trustee of
IDEX Fund and IDEX Fund 3; Executive Vice President (June 1993 to present) and
Director (March 1994 to present) of WRL Series Fund, Inc. (investment company);
President, Chief Executive Officer and Director (May 1988 to present) of
InterSecurities, Inc. (broker-dealer); President (September 1992 to present) of
ISI Insurance Agency, Inc.; Executive Vice President (April 1993 to present) of
Western Reserve Life Assurance Co. of Ohio (life insurance); President, Chief
Executive Officer and Director (1983 to November 1990) of PW Securities, Inc.
(broker-dealer); President, Chief Executive Officer and Director (September 1990
to present) and Executive Vice President and Director (May 1988 to September
1990) of Idex Management, Inc. (investment adviser); President and Director (May
1988 to present) of Idex Investor Services, Inc. (transfer agent); Assistant
Vice President (September 1991 to September 1992) of AEGON USA Managed
Portfolios, Inc. (financial services); Vice President (May 1988 to February
1991) of Pioneer Western Corporation (financial services). Mr. Hurley was
employed by Pioneer Western Corporation in various executive positions from 1972
until February 1991.
43
<PAGE>
- ----------
John R. Kenney(2)
02/08/38
Trustee (1987 to present), Chairman (December 1989 to present) and President and
Chief Executive Officer (1987 to September 1990) of IDEX Series Fund;^ Chairman
of the Board (1986 to present) of WRL Series Fund, Inc. (investment company);
President and Director (1985 to September 1990) and Director (December 1990 to
present) of Idex Management, Inc. (investment adviser); Chairman (1988 to
present) and Director (1985 to present) of InterSecurities, Inc.
(broker-dealer); Director (October 1992 to present) of ISI Insurance Agency,
Inc.; President and Chief Executive Officer, (1978 to 1987), Chairman and Chief
Executive Officer (1987 to 1992) and Chairman, President and Chief Executive
Officer (1992 to present) of Western Reserve Life Assurance Co. of Ohio (life
insurance); Senior Vice President (May 1992 to present) of AEGON USA, Inc.
(financial services holding company); Chairman and Chief Executive Officer (1988
to February 1991), President and Chief Executive Officer (1988 to 1989),
Executive Vice President (1972 to 1988) and Director (1976 to February 1991) of
Pioneer Western Corporation (financial services). Mr. Kenney is also the
brother-in-law of Jack Zimmerman, a trustee of the Fund.
- ---------
Julian A. Lerner
One Spurling Plaza, Suite 208
12850 Spurling Road
Dallas, TX 75230
11/12/24
Trustee ^ of IDEX Series Fund; ^ currently semi-retired; Trustee of American
Skandia Investment Trust; Advisor to the Board of Associated Financial Group
(financial services organization); formerly Investment Consultant (1995-1996)
and Sr. Vice President (1987-1995) of Aim Capital Management (investment
adviser).
- ---------
Thomas R. Moriarty(2)
05/03/51
Senior Vice President (March 1995 to present), Treasurer and Principal Financial
Officer (December 1996 to present), Vice President and Principal Accounting
Officer (November 1990 to March 1995) and Principal Accounting Officer (1988 to
September 1990) of IDEX Series Fund; former Senior Vice President of IDEX Fund
and IDEX Fund 3; Senior Vice President (June 1991 to present) and Vice President
(1988 to June 1991) of InterSecurities, Inc. (broker-dealer); Senior Vice
President (September 1992 to present) of ISI Insurance Agency, Inc.; President
(November 1990 to present) and Vice President (1988 to November 1990) of PW
Securities, Inc. (broker-dealer); Senior Vice President (June 1991 to present)
and Vice President (1988 to June 1991) of Idex Investor Services, Inc. (transfer
agent); Vice President (November 1990 to present) and Assistant Vice President
(1988 to September 1990) of Idex Management, Inc. (investment adviser); Vice
President (June 1993 to present) of Western Reserve Life Assurance Co. of Ohio
(life insurance); Assistant Vice President (September 1991 to September 1992) of
AEGON USA Managed Portfolios, Inc. (financial services); President (November
1990 to December 1992) and Vice President (1988 to November 1990) of PW
Securities, Inc. (broker-dealer). Mr. Moriarty was employed by Pioneer Western
Corporation in various executive positions from 1984 to February 1991.
- ----------
Christopher G. Roetzer(2)
01/11/63
Principal Accounting Officer (March 1995 to present) and Assistant Vice
President (November 1990 to present) of IDEX Series Fund; former Principal
Accounting Officer of IDEX Fund and IDEX Fund 3; Assistant Vice President and
Controller (May 1988 to present) of InterSecurities, Inc. (broker-dealer);
Assistant Vice President (September 1992 to present) of ISI Insurance Agency,
Inc.; Assistant Vice President and Controller (May 1988 to present) of Idex
Investor Services, Inc. (transfer agent); Assistant Vice President (November
1990 to present) of Idex Management, Inc. (investment adviser); Assistant Vice
President and Assistant Controller (April 1988 to May 1988) and Accounting
Manager (June 1986 to April 1988) of Western Reserve Life Assurance Co. of Ohio
(life insurance); and Auditor (September 1984 to June 1986) of Peat, Marwick,
Mitchell & Co. (CPA firm).
44
<PAGE>
- ---------
William W. Short, Jr.
12420 73rd Court
Largo, FL 34623
02/25/36
Trustee of IDEX Series Fund;^ President and sole shareholder of Shorts, Inc.
(men's retail apparel); Chairman of Southern Apparel Corporation and S.A.C.
Apparel Corporation and S.A.C. Distributors (nationwide wholesale apparel
distributors), Largo, Florida; ^ Member of Advisory Board of Barnett Banks of
Pinellas County; Trustee of Morton Plant Hospital Foundation; former Chairman of
Advisory Board of First Florida Bank, Pinellas County, Florida.
- ---------
Jack E. Zimmerman
507 Saint Michel Circle
Kettering, OH 45429
02/03/28
Trustee of IDEX Series Fund; ^ Director (1987 to present), Western Reserve Life
Assurance Co. of Ohio (life insurance); currently retired; formerly, Director,
Regional Marketing^ (September 1986 to January 1993) Martin Marietta
Corporation, Dayton (aerospace industry); Director of Strategic Planning
(January 1986 to September 1986) of Martin Marietta Baltimore Aerospace. Mr.
Zimmerman is also the brother-in-law of John Kenney, Trustee and Chairman of the
Fund.
- -------------------
(1) The principal business address of each person listed, unless otherwise
indicated, is P.O. Box 9015, Clearwater, FL 34618-9015.
(2) Interested Person (as defined in the Investment Company Act of 1940) of the
Fund.
The Fund pays no salaries or compensation to any of its officers, all of
whom are officers or employees of either ISI, IMI or their affiliates.
Disinterested Trustees (i.e., Trustees who are not affiliated with ISI, IMI or
any of the sub-advisers) receive for each regular Board meeting: (a) a total
annual retainer fee of $13,000 from IDEX Series Fund, of which the Fund pays a
pro rata share allocable to each Portfolio based on the relative assets of the
Portfolio; plus (b) $2,250 and incidental expenses per meeting attended. Three
of the Disinterested Trustees have been elected to serve on the Fund's Audit
Committee, which meets twice annually. Each Audit Committee member receives a
total of $250 per Audit Committee meeting attended in addition to the regular
meetings attended. In the case of a Special Board Meeting, each of the
Disinterested Trustees receives a fee of $500 per special meeting attended in
addition to the regular meetings attended. Any fees and expenses paid to
Trustees who are affiliates of IMI or ISI are paid by IMI and/or ISI and not by
the Fund or the Fund Complex. Commencing on January 1, 1996, a non-qualified
deferred compensation plan (the "Plan") became available to Trustees who are not
interested persons of the Fund. Under the Plan, compensation may be deferred
that would otherwise be payable by IDEX Series Fund and/or WRL Series Fund,
Inc., to a Disinterested Trustee or Director on a current basis for services
rendered as Trustee. Deferred compensation amounts will accumulate based on the
value of Class A shares of a Portfolio of the Fund (without imposition of sales
charge), as elected by the Trustee. It is not anticipated that the Plan will
have any impact on the Portfolios of the Fund.
The following table provides compensation amounts paid to Disinterested
Trustees of the Fund for the one-month period ended October 31, 1996 and the
fiscal year ended September 30, 1996.
45
<PAGE>
COMPENSATION TABLE
<TABLE>
<CAPTION>
AGGREGATE PENSION OR RETIREMENT TOTAL COMPENSATION PAID
COMPENSATION FROM BENEFITS ACCRUED AS PART TO TRUSTEES FROM FUND
NAME OF PERSON, POSITION IDEX SERIES FUND OF FUND EXPENSES* COMPLEX**
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Peter R. Brown, Trustee $0 $3,637 $19,000 $18,500 $2,500 $31,000
Daniel Calabria, Trustee $250 $3,887 $6,500 $6,250 $500 $12,500
James L. Churchill, Trustee $100 $5,919 $14,800 $14,400 $500 $23,500
Charles C. Harris, Trustee $500 $15,414 $0 $0 $2,500 $31,000
Julian A. Lerner, Trustee $500 $7,773 $0 $0 $500 $12,500
William W. Short, Jr., Trustee $500 $15,414 $0 $0 $500 $24,000
Jack E. Zimmerman, Trustee $0 $3,637 $18,500 $18,000 $500 $23,500
Total $1,850 $55,681 $58,800 $57,150 $7,500 $158,000
</TABLE>
* Because the Plan was effective January 1, 1996, amounts shown in the table
are also equal to total amounts accrued to date under the Plan.
** The Fund Complex ^ consists of IDEX Series Fund (including IDEX Fund and
IDEX Fund 3 prior to their reorganization into IDEX Series Fund on
September 20, 1996)and WRL Series Fund, Inc.
The Board of Trustees has adopted a policy whereby any Disinterested
Trustee of the Fund in office on September 1, 1990 who has served at least three
years as a trustee may, subject to certain limitations, elect upon his
resignation to serve as a trustee emeritus for a period of two years. A trustee
emeritus has no authority, power or responsibility with respect to any Fund
matter. While serving as such, a trustee emeritus is entitled to receive from
the Fund an annual fee equal to one-half the fee then payable per annum to
Disinterested Trustees of the Fund, plus reimbursement of expenses incurred for
attendance at Board meetings.
The Fund has an executive committee whose members currently are John R.
Kenney, G. John Hurley and Peter R. Brown. The executive committee may perform
all of the functions which may be performed by the Board of Trustees, except as
set forth in the Declaration of Trust and By-Laws of the Fund or as prohibited
by applicable law.
During the one-month period ended October 31, 1996 and the fiscal year
ended September 30, 1996, the Fund paid ^ $6,000 and ^ $62,000, respectively, in
trustees fees and expenses and no trustee emeritus fees or expenses. As of ^
January 2, 1997, the trustees and officers held in the aggregate less than 1% of
the outstanding shares of each of the Aggressive Growth, International Equity,
Capital Appreciation, Global, Growth, C.A.S.E., Value Equity, ^ Strategic Total
Return, Tactical Asset Allocation, Balanced, Flexible Income, Income Plus and
Tax-Exempt Portfolios.
PURCHASE OF SHARES
As stated in the Prospectus, each Portfolio offers investors a choice of
three classes of shares, and the Growth Portfolio includes a fourth class, Class
T shares. Class A, Class B or Class C shares of a Portfolio can be purchased
through ISI or through broker-dealers or other financial institutions that have
sales agreements with ISI. Class T shares of IDEX Growth Portfolio are not
available to new investors; only existing Class T shareholders (former
shareholders of IDEX Fund and IDEX Fund 3) can purchase Class T shares of the
Growth Portfolio. Shares of each Portfolio are sold at the net asset value per
share as determined at the close of the regular session of business on the New
York Stock Exchange next occurring after a purchase order is received
46
<PAGE>
and accepted by the Fund plus the applicable sales charge in the case of Class A
and Class T shares. The Prospectus contains detailed information about the
purchase of Portfolio shares.
DISTRIBUTION PLANS
As stated in the Prospectus under "Investment Advisory and Other Services",
each Portfolio has adopted a separate Distribution Plan pursuant to Rule 12b-1
under the 1940 Act (individually, a "Plan" and collectively, the "Plans"),
applicable to Class A, Class B and Class C shares of the Portfolio. Class T
shares of the Growth Portfolio are not subject to annual distribution and
service fees.
Under the Plans for Class A shares (the "Class A Plans"), a Portfolio may
pay ISI an annual distribution fee of up to 0.35%, and an annual service fee of
up to 0.25%, of the average daily net assets of the Portfolio's Class A shares;
however, to the extent that the Portfolio pays service fees, the amount which
the Portfolio may pay as a distribution fee is reduced accordingly so that the
total fees payable under the Class A Plan may not exceed on an annualized basis
0.35% of the average daily net assets of the Portfolio's Class A shares.
Under the Plans for Class B shares (the "Class B Plans"), a Portfolio may
pay ISI an annual distribution fee of up to 0.75% and an annual service fee of
up to 0.25%, of the average daily net assets of the Portfolio's Class B shares.
Under the Plans for Class C shares (the "Class C Plans"), a Portfolio may
pay ISI an annual distribution fee of up to 0.75% and an annual service fee of
up to 0.25% of the average daily net assets of the Portfolio's Class C shares;
however, the total fee payable pursuant to the Class C Plan may not on an
annualized basis exceed 0.90% of the average daily net assets of the Portfolio's
Class C shares.
ISI may use the fees payable under the Class A, Class B and Class C Plans
as it deems appropriate to pay for activities or expenses primarily intended to
result in the sale of the Class A, Class B or Class C shares, respectively, or
in personal service to and/or maintenance of Class A, Class B or Class C
shareholder accounts, respectively. For each class, these activities and
expenses may include, but are not limited to compensation to employees of ISI;
compensation to and expenses of ISI and other selected dealers who engage in or
otherwise support the distribution of shares or who service shareholder
accounts; the costs of printing and distributing prospectuses, statements of
additional information and reports for other than existing shareholders; and the
cost of preparing, printing and distributing sales literature and advertising
materials.
Under the Plans, as required by Rule 12b-1, the Board of Trustees will
review at least quarterly a written report provided by ISI of the amounts
expended by ISI in distributing and servicing Class A, Class B or Class C shares
of the Portfolio and the purpose for which such expenditures were made. For so
long as the Plans are in effect, selection and nomination of the Trustees who
are not interested persons of the Fund shall be committed to the discretion of
the Trustees who are not interested persons of the Fund.
A Plan may be terminated as to a class of shares of a Portfolio at any time
by vote of a majority of the non-interested Trustees or by vote of a majority of
the outstanding voting securities of the applicable class. A Plan may be amended
by vote of the Trustees, including a majority of the non- interested Trustees
who are not interested persons of the Fund and have no direct or indirect
financial interest in the operation of the Plan or any agreement relating
thereto ("non-interested Trustees"), cast in person at a meeting called for that
purpose. Any amendment of a Plan that would materially increase the costs to a
particular class of shares of a Portfolio requires approval by the shareholders
of that class. A Plan will remain in effect for successive one year periods, so
long as such continuance is approved annually by vote of the Fund's Trustees,
including a majority of the non-interested Trustees, cast in person at a meeting
called for the purpose of voting on such continuance.
DISTRIBUTION FEES
Distribution ^ related expenses incurred by ISI for the one-month period
ended October 31, 1996 and the fiscal year ended September 30, 1996^ were as
follows. These expenses have been partially reimbursed to ISI by the 12b-1
arrangements with the Fund.
47
<PAGE>
<TABLE>
<CAPTION>
AGGRESSIVE GROWTH
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $157 $18,689 $35 $2,107 $8 $5,131
Printing/mailing $4,360 $20,464 $959 $3,760 $228 $2,454
Prospectuses to other
than current shareholders
Compensation to underwriters $1,906 $19,470 $1,214 $7,764 $1,221 $15,985
Compensation to dealers $4,765 $48,675 $405 -- $470 $6,148
Compensation to sales personnel $1,095 $1,611 $241 $302 $57 $167
Interest or other finance -- -- -- -- -- --
charges
Travel $219 $4,476 $48 $806 $11 $620
Office Expenses $434 $17,033 $95 $2,738 $23 $3,128
Administrative Processing Costs $345 $1,036 $131 $392 $135 $405
TOTAL $13,281 $131,454 $3,128 $17,869 $2,153 $34,038
</TABLE>
<TABLE>
<CAPTION>
CAPITAL APPRECIATION
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $274 $10,406 $37 $2,151 $14 $2,410
Printing/mailing $7,579 $23,446 $1,013 $4,492 $391 $3,403
Prospectuses to other
than current shareholders
Compensation to underwriters $1,647 $10,891 $1,349 $7,281 $1,261 $16,717
Compensation to dealers $4,118 $27,229 $450 -- $485 $6,430
Compensation to sales personnel $1,904 $2,340 $254 $431 $98 $315
Interest or other finance -- -- -- -- -- --
charges
Travel $380 $4,588 $51 $1,035 $20 $1,171
Office Expenses $755 $7,334 $101 $1,651 $39 $1,299
Administrative Processing Costs $228 $684 $124 $373 $124 $373
TOTAL $16,885 $86,918 $3,379 $17,414 $2,432 $32,118
</TABLE>
<TABLE>
<CAPTION>
GLOBAL
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $855 $9,104 $194 $920 $139 $1,335
Printing/mailing $23,693 $139,124 $5,362 $18,881 $3,840 $19,310
Prospectuses to other
than current shareholders
Compensation to underwriters $11,506 $105,872 $3,543 $16,329 $4,686 $35,301
Compensation to dealers $28,766 $264,679 $1,181 -- $1,802 $13,577
Compensation to sales personnel $5,951 $41,945 $1,347 $5,033 $964 $6,547
Interest or other finance charges -- -- -- -- -- --
Travel $1,188 $9,632 $269 $1,219 $192 $1,626
Office Expenses $2,360 $8,682 $534 $1,109 $382 $1,169
Administrative Processing Costs $795 $8,793 $144 $1,432 $186 $2,084
TOTAL $75,114 $587,831 $12,574 $44,923 $12,191 $80,949
</TABLE>
<TABLE>
<CAPTION>
GROWTH
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $1,693 $27,068 $133 $918 $67 $1,910
Printing/mailing $46,894 $351,326 $3,689 $16,577 $1,850 $22,710
Prospectuses to other
than current shareholders
Compensation to underwriters $48,496 $523,027 $3,166 $16,832 $6,195 $52,279
Compensation to dealers $121,240 $1,307,566 $1,055 -- $2,383 $20,107
Compensation to sales personnel $11,779 $118,398 $927 $4,770 $465 $8,089
Interest or other finance charges -- -- -- -- -- --
Travel $2,351 $26,470 $185 $1,084 $93 $1,894
Office Expenses $4,671 $22,410 $368 $983 $184 $1,480
Administrative Processing Costs $3,152 $37,972 $153 $1,495 $207 $2,344
TOTAL $240,276 $2,414,237 $9,676 $42,659 $11,444 $110,813
</TABLE>
<TABLE>
<CAPTION>
C.A.S.E.
A B C
SHARES SHARES SHARES
^ 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
10/31/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $41 $948 $11 $1,150 $27 $1,832
Printing/mailing $1,137 $2,549 $305 $2,147 $757 $1,912
Prospectuses to other than
current shareholders
Compensation to underwriters $133 $751 $951 $3,928 $350 $5,360
Compensation to dealers $333 $1,876 -- -- $135 $2,062
Compensation to sales personnel $286 $247 $77 $184 $190 $76
Interest or other finance charges -- -- -- -- -- --
Travel $57 $540 $15 $633 $38 $942
Office Expenses $113 $875 $30 $1,140 $75 $2,665
Administrative Processing Costs $112 $336 $106 $317 $110 $330
TOTAL $2,212 $8,122 $1,495 $9,499 $1,682 $15,179
</TABLE>
<TABLE>
<CAPTION>
^ STRATEGIC TOTAL RETURN
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $110 $6,180 $26 $1,675 $14 $1,563
Printing/mailing $3,049 $13,540 $732 $2,820 $398 $2,988
Prospectuses to other than
current shareholders
Compensation to underwriters $977 $8,140 $1,035 $6,629 $977 $6,203
Compensation to dealers $2,442 $20,350 $345 -- $376 $2,386
Compensation to sales personnel $766 $1,201 $184 $241 $100 $232
Interest or other finance charges -- -- -- -- -- --
Travel $153 $2,239 $37 $759 $20 $578
Office Expenses $304 $7,785 $73 $1,627 $40 $2,368
Administrative Processing Costs $167 $500 $116 $347 $118 $354
TOTAL $7,968 $59,935 $2,548 $14,098 $2,043 $16,672
</TABLE>
48
<PAGE>
<TABLE>
<CAPTION>
TACTICAL ASSET ALLOCATION
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $170 $6,178 $39 $6,207 $38 $3,329
Printing/mailing $4,715 $12,610 $1,081 $8,746 $1,050 $6,338
Prospectuses to other than
current shareholders
Compensation to underwriters $664 $3,454 $3,143 $22,393 $2,587 $15,989
Compensation to dealers $1,660 $8,636 $1,048 -- $995 $6,149
Compensation to sales personnel $1,184 $1,129 $271 $683 $264 $558
Interest or other finance charges -- -- -- -- -- --
Travel $236 $2,847 $54 $2,617 $53 $1,523
Office Expenses $470 $6,403 $108 $6,336 $105 $3,387
Administrative Processing Costs $137 $410 $119 $356 $11 $358
TOTAL $9,236 $41,667 $5,863 $47,338 $5,103 $37,631
</TABLE>
<TABLE>
<CAPTION>
BALANCED
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $71 $3,386 $36 $623 $6 $1,064
Printing/mailing $1,980 $7,500 $997 $1,631 $170 $1,078
Prospectuses to other than
current shareholders
Compensation to underwriters $706 $5,805 $467 $2,605 $530 $15,541
Compensation to dealers $1,765 $14,513 $156 -- $204 $5,977
Compensation to sales personnel $497 $658 $250 $154 $43 $57
Interest or other finance charge -- -- -- -- -- --
Travel $99 $1,196 $50 $228 $9 $427
Office Expenses $197 $4,492 $99 $756 $17 $1,305
Administrative Processing Costs $137 $411 $105 $315 $113 $338
TOTAL $5,452 $37,961 $2,160 $6,312 $1,092 $25,787
</TABLE>
<TABLE>
<CAPTION>
FLEXIBLE INCOME
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $43 $896 $7 $96 $6 $461
Printing/mailing $1,186 $11,415 $199 $1,588 $154 $2,952
Prospectuses to other than
current shareholders
Compensation to underwriters $1,451 $18,303 $322 $2,252 $477 $5,587
Compensation to dealers $3,628 $45,758 $107 -- $183 $2,149
Compensation to sales personnel $298 $4,142 $50 $599 $39 $1,290
Interest or other finance charges -- -- -- -- -- --
Travel $59 $883 $10 $134 $8 $283
Office Expenses $118 $702 $20 $83 $15 $262
Administrative Processing Costs $172 $2,093 $102 $1,212 $111 $1,308
TOTAL $6,955 $84,192 $817 $5,964 $993 $14,292
</TABLE>
<TABLE>
<CAPTION>
INCOME PLUS
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $150 $3,631 $6 $270 $21 $667
Printing/mailing $4,151 $41,521 $176 $3,232 $583 $6,654
Prospectuses to other than
current shareholders
Compensation to underwriters $5,592 $65,983 $497 $4,642 $1,497 $16,650
Compensation to dealers $13,980 $164,959 $166 $0 $576 $6,404
Compensation to sales personnel $1,043 $14,760 $44 $1,196 $147 $2,621
Interest or other finance charges -- -- -- -- -- --
Travel $208 $3,229 $9 $262 $29 $548
Office Expenses $414 $2,757 $18 $204 $58 $452
Administrative Processing Costs $283 $3,468 $104 $1,229 $119 $1,397
TOTAL $25,821 $300,308 $1,020 $11,035 $3,030 $35,393
</TABLE>
<TABLE>
<CAPTION>
TAX-EXEMPT
A B C
SHARES SHARES SHARES
10/31/96 9/30/96 10/31/96 9/30/96 10/31/96 9/30/96
<S> <C> <C> <C> <C> <C> <C>
Advertising $59 $1,123 $2 $31 $11 $201
Printing/mailing $1,645 $13,723 $51 $697 $292 $2,110
Prospectuses to other than
current shareholders
Compensation to underwriters $2,093 $25,933 $121 $1,029 $298 $1,941
Compensation to dealers $5,232 $64,833 $40 -- $213 $1,387
Compensation to sales personnel $413 $4,822 $13 $274 $73 $761
Interest or other finance charges -- -- -- -- -- --
Travel $82 $1,060 $3 $47 $15 $164
Office Expenses $164 $883 $5 $30 $29 $146
Administrative Processing Costs $155 $1,861 $100 $1,203 $109 $1,279
TOTAL $9,843 $114,238 $335 $3,311 $1,040 $7,989
</TABLE>
49
<PAGE>
No distribution fees were applicable to Class A, Class B or Class C shares
of the International Equity or Value Equity Portfolios for the one-month period
ended October 31,1996 or the fiscal year ended September 30, 1996, as those
Portfolios had not yet commenced operations. Class T shares of the Growth
Portfolio are not subject to annual distribution and service fees.
NET ASSET VALUE DETERMINATION
As stated in the Prospectus, net asset value is determined separately for
each class of shares of a Portfolio on each day as of the close of the regular
session of business on the New York Stock Exchange (the "Exchange"), currently
4:00 p.m. Eastern Time, Monday through Friday, except on (i) days on which
changes in the value of portfolio securities will not materially affect the net
asset value of a particular class of shares of the Portfolio; (ii) days during
which no shares of the Portfolio are tendered for redemption and no orders to
purchase shares of that Portfolio are received; or (iii) customary national
holidays on which the Exchange is closed. The per share net asset value of each
class of shares of a Portfolio is determined by dividing the total value of the
Portfolio's securities, receivables and other assets allocable to that class by
the total number of shares outstanding of that class. The public offering price
of a Class A, Class B, Class C or Class T share of a Portfolio is the net asset
value per share plus, in the case of Class A and Class T shares, the applicable
sales charge. Investment securities are valued at the closing price for
securities traded on a principal securities exchange (U.S. or foreign) or on the
NASDAQ National Market. Investment securities traded on the over-the-counter
market and listed securities for which no sales are reported for the trading
period immediately preceding the time of determination are valued at the last
bid price. Foreign currency denominated assets and liabilities are converted
into U.S. dollars at the closing exchange rate each day. Other securities for
which quotations are not readily available are valued at fair values determined
in such manner as the Portfolio's sub-adviser, under the supervision of the
Board of Trustees, decide in good faith.
50
<PAGE>
OFFERING PRICE PER SHARE CALCULATED AS FOLLOWS:
<TABLE>
<CAPTION>
NET ASSET VALUE PER SHARE ADD MAXIMUM AMOUNT OF SALES
AS OF OCTOBER 31, 1996 NET ASSET SHARES OUTTANDING) SELLING COMMISSIONS CHARGE OFFERING PRICE PER SHARE
<S> <C> <C> <C> <C>
AGGRESSIVE GROWTH
Class A $15.70 5.50% $0.91 $16.61
Class B $15.58 -- -- $15.58
Class C $15.60 -- -- $15.60
CAPITAL APPRECIATION
Class A $15.49 5.50% $0.90 $16.39
Class B $15.42 -- -- $15.42
Class C $15.43 -- -- $15.43
GLOBAL
Class A $21.39 5.50% $1.24 $22.63
Class B $21.13 -- -- $21.13
Class C $21.03 -- -- $21.03
GROWTH
Class A $21.97 5.50% $1.28 $23.25
Class B $21.60 -- -- $21.60
Class C $21.65 -- -- $21.65
Class T $22.17 8.50% $2.06 $24.23
C.A.S.E.
Class A $10.56 5.50% $0.61 $11.17
Class B $10.51 -- -- $10.51
Class C $10.52 -- -- $10.52
STRATEGIC TOTAL RETURN
Class A $13.43 5.50% $0.78 $14.21
Class B $13.42 -- -- $13.42
Class C $13.42 -- -- $13.42
TACTICAL ASSET ALLOCATION
Class A $11.19 5.50% $0.65 $11.84
Class B $11.18 -- -- $11.18
Class C $11.18 -- -- $11.18
BALANCED
Class A $13.58 5.50% $0.79 $14.37
Class B $13.56 -- -- $13.56
Class C $13.57 -- -- $13.57
FLEXIBLE INCOME
Class A $9.33 4.75% $0.47 $9.80
Class B $9.32 -- -- $9.32
Class C $9.32 -- -- $9.32
INCOME PLUS
Class A $10.61 4.75% $0.53 $11.14
Class B $10.61 -- -- $10.61
Class C $10.61 -- -- $10.61
TAX-EXEMPT
Class A $11.40 4.75% $0.57 $11.97
Class B $11.40 -- -- $11.40
Class C $11.40 -- -- $11.40
</TABLE>
No such calculations are presented for International Equity and Value
Equity Portfolios because no shares of those Portfolios were outstanding as of
October 31, 1996.
51
<PAGE>
DIVIDENDS AND OTHER DISTRIBUTIONS
As indicated in the Prospectus, an investor may choose among several
options with respect to dividends and capital gain distributions payable to the
investor. Dividends or other distributions will be paid in full and fractional
shares at the net asset value determined as of the ex-dividend date, unless the
shareholder has elected another distribution option as described in the
Prospectus. Transaction confirmations and checks for payments designated to be
made in cash generally will be mailed on the payable date. The per share income
dividends on Class B and Class C shares of a Portfolio are anticipated to be
lower than the per share income dividends on Class A shares of that Portfolio,
and Class T shares of the Growth Portfolio, as a result of higher ^ distribution
and service fees applicable to the Class B and Class C shares.
SHAREHOLDER ACCOUNTS
Detailed information about general procedures for Shareholder Accounts and
specific types of accounts is set forth in the Prospectus.
RETIREMENT PLANS
As stated in the Prospectus, the Fund offers several types of retirement
plans that an investor may establish to invest in shares of a Portfolio with tax
deductible dollars. Prototype retirement plans for both corporations and
self-employed individuals and for Individual Retirement Accounts, Code Section
401(k) Plans and Simplified Employee Pension Plans are available by calling or
writing IDEX Customer Service. These plans require the completion of separate
applications which are also available from IDEX Customer Service. Investors
Fiduciary Trust Company ("IFTC"), Kansas City, Missouri, acts as the custodian
or trustee under these plans for which it charges an annual fee of up to $15.00
on each such account with a maximum of $30.00 per tax identification number.
However, if your retirement plan is under custody of IFTC and your combined
retirement account balances per taxpayer ID number are more than $50,000, there
is generally no fee. Shares of a Portfolio are also available for investment by
Code Section 403(b)(7) retirement plans for employees of charities, schools, and
other qualifying employers. The Tax Exempt Portfolio is not well-suited as an
investment vehicle for tax-deferred retirement plans which cannot benefit from
tax-exempt income and whose distributed earnings are taxable to individual
recipients as ordinary income. To receive additional information or forms on
these plans, please call IDEX Customer Service at (800) 851-9777 or write the
Transfer Agent at P. O. Box 9015, Clearwater, Florida 34618-9015. No
contribution to a retirement plan can be made until the appropriate forms to
establish the plan have been completed. It is advisable for an investor
considering the funding of any retirement plan to consult with an attorney,
retirement plan consultant or financial or tax advisor with respect to the
requirements of such plans and the tax aspects thereof.
REDEMPTION OF SHARES
Shareholders may redeem their shares at any time at any price equal to the
net asset value per share next determined following receipt of a valid
redemption order by the transfer agent, in proper form as prescribed in the
Prospectus. Payment will ordinarily be made within three days of the receipt of
a valid redemption order. The value of shares on redemption may be more or less
than the shareholder's cost, depending upon the market value of the Portfolio's
net assets at the time of redemption. CLASS B SHARES AND CERTAIN CLASS A SHARE
PURCHASES ARE ALSO SUBJECT TO A CONTINGENT DEFERRED SALES CHARGE UPON CERTAIN
REDEMPTIONS. THE PROSPECTUS DESCRIBES THE REQUIREMENTS AND PROCEDURES FOR THE
REDEMPTION OF SHARES.
Shares will normally be redeemed for cash, although each Portfolio retains
the right to redeem its shares in kind under unusual circumstances, in order to
protect the interests of the remaining shareholders, by the delivery of
securities selected from its assets at its discretion. The Fund has, however,
elected to be governed by Rule 18f-1 under the 1940 Act pursuant to which the
Fund is obligated to redeem shares solely in cash up to the lesser of $250,000
or 1% of the net asset value of a Portfolio during any 90-day period for any one
shareholder. Should redemptions by any shareholder exceed such limitation, the
Fund will have the option of redeeming the excess in cash or in kind. If shares
are redeemed in kind, the redeeming shareholder might incur brokerage costs in
converting the assets to cash. The method of valuing securities used to make
redemptions in kind will be the same as the method of valuing portfolio
securities described under "Net Asset Value Determination", and such valuation
will be made as of the same time the redemption price is determined. Upon any
distributions in-kind, shareholders may appeal the valuation of such securities
by writing to the Fund.
52
<PAGE>
Redemption of shares may be suspended, or the date of payment may be
postponed, whenever (1) trading on the Exchange is restricted, as determined by
the Securities and Exchange Commission, or the Exchange is closed except for
holidays and weekends, (2) the Securities and Exchange Commission permits such
suspension and so orders, or (3) an emergency exists as determined by the
Securities and Exchange Commission so that disposal of securities and
determination of net asset value is not reasonably practicable.
The Contingent Deferred Sales Charge ("CDSC") is waived on redemptions of
Class B shares in the circumstances described below:
(a) Redemption upon Total Disability or Death
The Fund will waive the CDSC on redemptions following the death or total
disability (as evidenced by a determination of the federal Social Security
Administration) of a Class B shareholder, but in the case of total disability
only as to shares owned at the time of the initial determination of disability.
The Transfer Agent or Distributor will require satisfactory proof of death or
disability before it determines to waive the CDSC.
(b) Redemption Pursuant to a Fund's Systematic Withdrawal Plan
A shareholder may elect to participate in a systematic withdrawal plan
("Plan") with respect to the shareholder's investment in the Fund. Under the
Plan, a dollar amount of a participating shareholder's investment in the Fund
will be redeemed systematically by the Fund on a periodic basis, and the
proceeds paid in accordance with the shareholder's instructions. The amount to
be redeemed and frequency of the systematic withdrawals will be specified by the
shareholder upon his or her election to participate in the Plan. The CDSC will
be waived on redemptions made under the Plan subject to the limitations
described below.
The amount of the shareholder's investment in a Fund at the time election
to participate in the Plan is made with respect to the Fund is hereinafter
referred to as the "Initial Account Balance." The amount to be systematically
redeemed from the Fund without the imposition of a CDSC may not exceed a maximum
of 12% annually of the shareholder's Initial Account Balance. The Fund reserves
the right to change the terms and conditions of the Plan and the ability to
offer the Plan.
The CDSC is also waived on redemption of Class B shares as it relates to
the reinvestment of redemption proceeds in Class B shares of another IDEX
Portfolio within 90 days after redemption.
TAXES
Each Portfolio has qualified, and intends to continue to qualify, for
treatment as a regulated investment company ("RIC") under the Internal Revenue
Code of 1986, as amended (the "Code"). In order to qualify for that treatment,
each Portfolio must must distribute to its shareholders for each taxable year at
least 90% of its investment company taxable income (consisting generally of
taxable net investment income and net short-term capital gain) and must meet
several additional requirements. With respect to each Portfolio, these
requirements include the following: (1) the Portfolio must derive at least 90%
of its gross income each taxable year from dividends, interest, payments with
respect to securities loans and gains from the sale or other disposition of
securities, or other income (including gains from futures contracts) derived
with respect to its business of investing in securities; (2) the Portfolio must
derive less than 30% of its gross income each taxable year from the sale or
other disposition of securities or futures contracts that were held for less
than three months ("Short-Short Limitation"); (3) at the close of each quarter
of the Portfolio's taxable year, at least 50% of the value of its total assets
must be represented by cash and cash items, U.S. government securities,
securities of other RICs and other securities, with these other securities
limited, in respect of any one issuer, to an amount that does not exceed 5% of
the value of the Portfolio's total assets and that does not represent more than
10% of the outstanding voting securities of the issuer; and (4) at the close of
each quarter of the Portfolio's taxable year, not more than 25% of the value of
its total assets may be invested in securities (other than U.S. government
securities or the securities of other RICs) of any one issuer.
A Portfolio will be subject to a nondeductible 4% excise tax to the extent
it fails to distribute by the end of any calendar year substantially all of its
ordinary income for that year and capital gain net income for the one-year
period ending on October 31 of that year, plus certain other amounts. Each
Portfolio intends to distribute annually a sufficient amount of any taxable
income and capital gains so as to avoid liability for this excise tax.
53
<PAGE>
If the Tax-Exempt Portfolio invests in any instruments that generate
taxable income, under the circumstances described in the Prospectus,
distributions of the interest earned thereon will be taxable to that Portfolio's
shareholders as ordinary income to the extent of its earnings and profits.
Moreover, if that Portfolio realizes capital gains as a result of market
transactions, any distributions of that gain also will be taxable to its
shareholders.
Proposals may be introduced before Congress for the purpose of restricting
or eliminating the federal income tax exemption for interest on municipal
securities. If such a proposal were enacted, the availability of municipal
securities for investment by the Tax-Exempt Portfolio and the value of its
portfolio securities would be affected. In that event, the Tax-Exempt Portfolio
will re-evaluate its investment objective and policies.
Dividends and interest received by a Portfolio may be subject to income,
withholding or other taxes imposed by foreign countries and U.S. possessions
that would reduce the yield on its securities. Tax conventions between certain
countries and the United States may reduce or eliminate these foreign taxes,
however, and foreign countries generally do not impose taxes on capital gains in
respect of investments by foreign investors. If more than 50% of the value of
the Global Portfolio's total assets at the close of its taxable year consists of
securities of foreign corporations, it will be eligible to, and may, file an
election with the Internal Revenue Service that will enable its shareholders, in
effect, to receive the benefit of the foreign tax credit with respect to any
foreign and U.S. possessions income taxes paid by it. Pursuant to the election,
a Portfolio will treat those taxes as dividends paid to its shareholders and
each shareholder will be required to (1) include in gross income, and treat as
paid by him, his proportionate share of those taxes, (2) treat his share of
those taxes and of any dividend paid by the Portfolio that represents income
from foreign or U.S. possessions sources as his own income from those sources,
and (3) either deduct the taxes deemed paid by him in computing his taxable
income or, alternatively, use the foregoing information in calculating the
foreign tax credit against his federal income tax. The Global Portfolio will
report to its shareholders shortly after each taxable year their respective
shares of the income from sources within, and taxes paid to, foreign countries
and U.S. possessions if it makes this election.
Each Portfolio except the Tax-Exempt Portfolio may invest in the stock of
"passive foreign investment companies" ("PFICs"). A PFIC is a foreign
corporation that, in general, meets either of the following tests: (1) at least
75% of its gross income is passive or (2) an average of at least 50% of its
assets produce, or are held for the production of, passive income. Under certain
circumstances, a Portfolio will be subject to federal income tax on a portion of
any "excess distribution" received on the stock of a PFIC or of any gain on
disposition of that stock (collectively "PFIC income"), plus interest thereon,
even if the Portfolio distributes the PFIC income as a taxable dividend to its
shareholders. The balance of the PFIC income will be included in the Portfolio's
investment company taxable income and, accordingly, will not be taxable to it to
the extent that income is distributed to its shareholders. If a Portfolio
invests in a PFIC and elects to treat the PFIC as a "qualified electing fund,"
then in lieu of the foregoing tax and interest obligation, the Portfolio will be
required to include in income each year its pro rata share of the qualified
electing fund's annual ordinary earnings and net capital gain (the excess of net
long-term capital gain over net short-term capital loss), even if they are not
distributed to the Portfolio; those amounts would be subject to the distribution
requirements described above. In most instances it will be very difficult, if
not impossible, to make this election because of certain requirements thereof.
The use of hedging strategies, such as writing (selling) and purchasing
options and futures contracts and entering into forward contracts, involves
complex rules that will determine for income tax purposes the character and
timing of recognition of the income received in connection therewith by a
Portfolio. Income from foreign currencies (except certain gains therefrom that
may be excluded by future regulations), and income from transactions in options,
futures and forward contracts derived by a Portfolio with respect to its
business of investing in securities or foreign currencies, will qualify as
permissible income under the Income Requirement. However, income from the
disposition of foreign currencies that are not directly related to the
Portfolio's principal business of investing in securities (or options and
futures with respect thereto) also will be subject to the Short-Short Limitation
if the securities are held for less than three months.
If a Portfolio satisfies certain requirements, any increase in value on a
position that is part of a "designated hedge" will be offset by any decrease in
value (whether realized or not) of the offsetting hedging position during the
period of the hedge for purposes of determining whether the Portfolio satisfies
the Short-Short Limitation. Thus, only the net gain (if any) from the designated
hedge will be included in gross income for purposes of that limitation. Each
Portfolio intends that, when it engages in hedging transactions, they will
qualify for this treatment, but at the present time it is not clear whether this
treatment will be available for all of the Portfolio's hedging transactions. To
the extent this treatment is not available, a Portfolio may be forced to defer
the closing out of certain options and futures contracts beyond the time when it
otherwise would be advantageous to do so, in order for the Portfolio to continue
to qualify as an RIC.
54
<PAGE>
The treatment of income dividends and capital gain distributions by a
Portfolio to shareholders under the various state income tax laws may not
parallel that under the federal law. Qualification as a regulated investment
company does not involve supervision of a Portfolio's management or of its
investment policies and practices by any governmental authority.
Shareholders are urged to consult their own tax advisors with specific
reference to their own tax situations, including their state and local tax
liabilities.
PRINCIPAL SHAREHOLDERS
To the knowledge of the Fund, as of ^ January 2, 1997, no shareholder owned
beneficially or of record 5% or more of the outstanding shares of beneficial
interest of each of the Aggressive Growth, International Equity, Capital
Appreciation, Global, C.A.S.E., Value Equity, ^ Strategic Total Return, Tactical
Asset Allocation, Balanced, Flexible Income or Tax-Exempt Portfolios, with the
following exceptions: ^ Patrick J. Logue was record owner of approximately 8% of
the Balanced Portfolio, and ISI owned beneficially or of record approximately
12% of the C.A.S.E. Portfolio. As of January 2, 1997, certain affiliates of ISI
and AEGON Management were the record owners of shares of beneficial interest of
the Income Plus Portfolio, as follows: AUSA Life Insurance Company owned
approximately ^ 7%, and Bankers United Life Assurance Company owned
approximately ^ 2%. As of ^ January 2, 1997, State Street Bank and Trust Company
as Trustee for the ConAgra Retirement Income Savings Plan, Boston,
Massachusetts, owned approximately ^ 9% of the outstanding shares of beneficial
interest of the Growth Portfolio.
MISCELLANEOUS^
ORGANIZATION
The Portfolios are series of IDEX Series Fund, a Massachusetts business
trust that was formed by a Declaration of Trust dated January 7, 1986. The Trust
currently is governed by a Restatement of Declaration of Trust ("Declaration of
Trust") dated as of August 30, 1991.
On October 1, 1993, in a tax-free reorganization, the Flexible Income
Portfolio acquired all of the assets and assumed all of the liabilities of IDEX
Total Income Trust ("IDEX Total") in exchange for shares of the Flexible Income
Portfolio which were then distributed to IDEX Total shareholders. All historical
financial and performance information set forth in the Statement of Additional
Information relates to IDEX Total prior to the date it was reorganized into the
Flexible Income Portfolio.
On September 20, 1996 in a tax-free reorganization, IDEX Growth Portfolio
(formerly IDEX II Growth Portfolio) acquired all of the assets and assumed all
of the liabilities of IDEX Fund and IDEX Fund 3 in exchange for Class T shares
of IDEX Growth Portfolio which were then distributed on a pro rata basis to the
respective shareholders of IDEX Fund and IDEX Fund 3. Upon closing of the
reorganization, IDEX II Series Fund changed its name to IDEX Series Fund.
SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Fund to issue an unlimited number of
shares of beneficial interest. Shares of the Fund are fully paid and
nonassessable when issued. Shares of the Fund have no preemptive, cumulative
voting, conversion or subscription rights. Shares of the Fund are fully
transferable but the Fund is not bound to recognize any transfer until it is
recorded on its books.
The shares of beneficial interest of each Portfolio are divided into three
classes, Class A, Class B and Class C shares; the Growth Portfolio includes a
fourth class, Class T shares. Each class represents interests in the same assets
of the Portfolio and differ as follows: each class of shares has exclusive
voting rights on matters pertaining to its plan of distribution or any other
matter appropriately limited to that class; Class A shares are subject to an
initial sales charge; Class B shares are subject to a contingent deferred sales
charge, or back-end load, at a declining rate; Class B and Class C shares are
subject to higher ongoing distribution and service fees; each class may bear
differing amounts of certain class-specific expenses; and each class has a
separate exchange privilege. Class T shares of the Growth Portfolio are subject
to an initial sales charge, but no annual distribution and service fees. Class T
shares are not available to new investors; only existing Class T shareholders
(who were shareholders of IDEX Fund or IDEX Fund 3 on September 20, 1996) may
purchase additional Class T shares. The Fund does not anticipate that there will
be any conflicts between the interests of holders of the different classes of
shares of the same Portfolio by virtue of these classes. On an ongoing basis,
the Board of Trustees will consider whether any such conflict exists
55
<PAGE>
and, if so, take appropriate action. On any matter submitted to a vote of
shareholders of a series or class, each full issued and outstanding share of
that series or class has one vote.
The Declaration of Trust provides that each of the trustees will continue
in office until the termination of the Trust or his earlier death, resignation,
bankruptcy or removal. A meeting will be called for the election of trustees
upon the written request of holders of 10% or more of the outstanding shares of
the Trust. Vacancies may be filled by majority of the remaining trustees,
subject to certain limitations imposed by the 1940 Act. Therefore, it is not
anticipated that annual or regular meetings of shareholders normally will be
held, unless otherwise required by the Declaration of Trust or the 1940 Act.
Subject to the foregoing, shareholders have the power to vote for the election
and removal of trustees, to terminate or reorganize the Fund, to amend the
Declaration of Trust, on whether to bring certain derivative actions and on any
other matters on which a shareholder vote is required by the 1940 Act, the
Declaration of Trust, the Fund's bylaws or the trustees.
LEGAL COUNSEL AND AUDITORS
Sutherland, Asbill & Brennan, L.L.P., 1275 Pennsylvania Avenue, N.W.,
Washington, D.C. 20004, serves as counsel to the Fund and certain of its
affiliates. ^ Price Waterhouse LLP, serves as independent accountants for the
Fund.
REGISTRATION STATEMENT
This Statement of Additional Information and the Prospectus for the
Portfolios do not contain all the information set forth in the registration
statement and exhibits relating thereto, which the Fund has filed with the
Securities and Exchange Commission, Washington, D.C. under the 1933 Act and the
1940 Act, to which reference is hereby made.
PERFORMANCE INFORMATION
The Prospectus contains a brief description of how performance is
calculated.
Quotations of average annual total return for a particular class of shares
of a Portfolio will be expressed in terms of the average annual compounded rate
of return of a hypothetical investment in the Portfolio over periods of 1, 5,
and 10 years. These are the average annual compounded rates of return that would
equate the initial amount invested to the ending redeemable value. These rates
of return are calculated pursuant to the following formula:
T ((ERV / P) 1/N)-1
(where P = a hypothetical initial investment of $1,000; T = the average annual
total return; N = the number of years; and ERV = the ending redeemable value of
a hypothetical $1,000 investment made at the beginning of the period). All
average annual total return figures reflect the deduction of a proportionate
share of each Portfolio's expenses on an annual basis, and assume that the
maximum sales load (Class A and Class T shares) is deducted from the initial
$1,000 investment and all dividends and distributions are paid in additional
shares.
56
<PAGE>
<TABLE>
^ AVERAGE ANNUAL TOTAL RETURN
<CAPTION>
AGGRESSIVE GROWTH CAPITAL APPRECIATION
CLASS CLASS
<S> <C> <C> <C> <C> <C> <C>
AS OF OCTOBER 31, 1996 A B C A B C
INCEPTION DATE 12/02/94 10/01/95 12/02/94 12/02/94 10/01/95 12/02/94
SALES CHARGE 5.50% * -- 5.50% * --
12B-1 FEE 0.35% 1.00% 0.90% 0.35% 1.00% 0.90%
AVERAGE ANNUAL TOTAL RETURN
INCLUDING SALES CHARGES:
1 year (6.68)% (6.62)% -- 17.79% 18.99% --
5 years -- -- -- -- -- --
10 years -- -- -- -- -- --
Inception 27.19% (9.84)% -- 26.31% 15.12% --
AVERAGE ANNUAL TOTAL RETURN
WITHOUT DEDUCTION OF SALES CHARGE:
1 year (1.24)% (1.62)% (1.56)% 24.61% 23.99% 24.07%
5 years -- -- -- -- -- --
10 years -- -- -- -- -- --
Inception 30.99% (5.20)% 30.54% 30.08% 19.67% 29.50%
CUMULATIVE TOTAL RETURN WITHOUT
DEDUCTION OF SALES CHARGE:
1 year (1.24)% (1.62)% (1.56)% 24.61% 23.99% 24.07%
5 years -- -- -- -- -- --
10 years -- -- -- -- -- --
Inception 67.69% (5.63)% 66.67% 65.48% 21.51% 64.14%
</TABLE>
GLOBAL
CLASS
AS OF OCTOBER 31, 1996 A B C
INCEPTION DATE 10/01/92 10/01/95 10/01/93
SALES CHARGE 5.50% * --
12B-1 FEE 0.35% 1.00% 0.90%
AVERAGE ANNUAL TOTAL RETURN
INCLUDING SALES CHARGES:
1 year 22.11% 23.97% --
5 years -- -- --
10 years -- -- --
Inception 20.94% 17.97% --
AVERAGE ANNUAL TOTAL RETURN
WITHOUT DEDUCTION OF SALES CHARGE:
1 year 29.22% 28.97% 29.14%
5 years -- -- --
10 years -- -- --
Inception 22.60% 22.51% 18.49%
CUMULATIVE TOTAL RETURN WITHOUT
DEDUCTION OF SALES CHARGE:
1 year 29.22% 28.97% 29.14%
5 years -- -- --
10 years -- -- --
Inception 130.02% 24.64% 68.74%
<TABLE>
<CAPTION>
GROWTH C.A.S.E.
CLASS CLASS
<S> <C> <C> <C> <C> <C> <C> <C>
AS OF OCTOBER 31, 1996 A B C T A B C
INCEPTION DATE 05/08/86 10/01/95 10/01/93 9/20/96 02/01/96 2/01/96 2/01/96
SALES CHARGE 5.50% * -- 8.50% 5.50% * --
12B-1 FEE 0.35% 1.00% 0.90% 0% 0.35% 1.00% 0.90%
AVERAGE ANNUAL TOTAL RETURN
INCLUDING SALES CHARGES:
1 year 12.93% 14.16% -- 11.35% -- -- --
5 years 11.47% -- -- 11.05% -- -- --
10 years 16.56% -- -- 16.07% -- -- --
Inception 15.86% 14.19% -- 16.42% (0.19)% 0.10% --
AVERAGE ANNUAL TOTAL RETURN
WITHOUT DEDUCTION OF SALES CHARGE:
1 year 19.52% 19.16% 19.17% 21.70% -- -- --
5 years 12.74% -- -- 13.04% -- -- --
10 years 17.23% -- -- 17.11% -- -- --
Inception 16.49% 18.74% 14.50% 17.33% 5.60% 5.10% 5.20%
CUMULATIVE TOTAL RETURN WITHOUT
DEDUCTION OF SALES CHARGE:
1 year 19.52% 19.16% 19.17% 21.70% -- -- --
5 years 82.16% -- -- 84.54% -- -- --
10 years 390.17% -- -- 385.04% -- -- --
Inception 395.66% 20.84% 51.85% 519.46% 5.60% 5.10% 5.20%
</TABLE>
57
<PAGE>
^ STRATEGIC TOTAL RETURN
CLASS
A B C
AS OF OCTOBER 31, 1996 12/02/94 10/01/95 12/02/94
INCEPTION DATE 5.50% * --
SALES CHARGE 0.35% 1.00% 0.90%
12B-1 FEE
AVERAGE ANNUAL TOTAL RETURN
INCLUDING SALES CHARGES: 11.16% 11.87% --
1 year -- -- --
5 years -- -- --
10 years 15.34% 10.71% --
Inception
AVERAGE ANNUAL TOTAL RETURN
WITHOUT DEDUCTION OF SALES CHARGE: 17.60% 16.87% 16.98%
1 year -- -- --
5 years -- -- --
10 years 18.28% 15.27% 18.13%
Inception
CUMULATIVE TOTAL RETURN WITHOUT
DEDUCTION OF SALES CHARGE: 17.60% 16.87% 16.98%
1 year -- -- --
5 years -- -- --
10 years 39.03% 16.67% 37.62%
Inception
<TABLE>
<CAPTION>
TACTICAL ASSET ALLOCATION BALANCED
CLASS CLASS
<S> <C> <C> <C> <C> <C> <C>
AS OF OCTOBER 31, 1996 A B C A B C
INCEPTION DATE 10/01/95 10/01/95 10/01/95 12/02/94 10/01/95 12/02/94
SALES CHARGE 5.50% * -- 5.50% * --
12B-1 FEE 0.35% 1.00% 0.90% 0.35% 1.00% 0.90%
AVERAGE ANNUAL TOTAL RETURN
INCLUDING SALES ^ CHARGE:
1 year 7.52% 8.14% -- 15.29% 16.12% --
5 years -- -- -- -- -- --
10 years -- -- -- -- -- --
Inception 5.99% 6.34% -- 16.62% 15.91% --
AVERAGE ANNUAL TOTAL RETURN
WITHOUT DEDUCTION OF SALES CHARGE:
1 year 13.82% 13.14% 13.25% 21.95% 21.12% 21.32%
5 years -- -- -- -- -- --
10 years -- -- -- -- -- --
Inception 11.64% 10.92% 11.01% 20.10% 20.45% 19.45%
CUMULATIVE TOTAL RETURN WITHOUT
DEDUCTION OF SALES CHARGE:
1 year 13.82% 13.14% 13.25% 21.95% 21.12% 21.32%
5 years -- -- -- -- -- --
10 years -- -- -- -- -- --
Inception 12.69% 11.90% 12.00% 42.02% 22.37% 40.58%
</TABLE>
FLEXIBLE INCOME
CLASS
A B C
AS OF OCTOBER 31, 1996 06/29/87 10/01/95 10/01/93
INCEPTION DATE 4.75% * --
SALES CHARGE 0.35% 1.00% 0.90%
12B-1 FEE
AVERAGE ANNUAL TOTAL RETURN
INCLUDING SALES ^ CHARGE: 2.20% 1.48% --
1 year 7.98% -- --
5 years -- -- --
10 years 7.57% 2.84% --
Inception
AVERAGE ANNUAL TOTAL RETURN
WITHOUT DEDUCTION OF SALES CHARGE: 7.28% 6.48% 6.58%
1 year 9.05% -- --
5 years -- -- --
10 years 8.19% 7.43% 5.28%
Inception
CUMULATIVE TOTAL RETURN WITHOUT
DEDUCTION OF SALES CHARGE: 7.28% 6.48% 6.58%
1 year 54.23% -- --
5 years -- -- --
10 years 108.75% 8.09% 17.21%
Inception
<TABLE>
<CAPTION>
INCOME PLUS TAX-EXEMPT
CLASS CLASS
A B C A B C
<S> <C> <C> <C> <C> <C> <C>
AS OF OCTOBER 31, 1996
INCEPTION DATE 06/14/85 10/01/95 10/01/93 04/01/85 10/01/95 10/01/93
SALES CHARGE 4.75% * -- 4.75% * --
12B-1 FEE 0.35% 1.00% 0.90% 0.35% 1.00% 0.60%
AVERAGE ANNUAL TOTAL RETURN
INCLUDING SALES CHARGEs:
1 year 5.02% 4.56% -- 0.24% (0.35)% --
5 years 9.01% -- -- 2.20% -- --
10 years 9.11% -- -- 6.04% -- --
Inception 10.29% 4.33% -- 7.49% 0.88% --
AVERAGE ANNUAL TOTAL RETURN WITHOUT
DEDUCTION OF SALES CHARGE:
1 year 10.21% 9.56% 9.61% 5.23% 4.65% 4.97%
5 years 10.08% -- -- 7.28% -- --
10 years 9.65% -- -- 6.56% -- --
Inception 10.76% 8.92% 6.27% 7.94% 5.48% 4.20%
CUMULATIVE TOTAL RETURN WITHOUT
DEDUCTION OF SALES CHARGE:
1 year 10.21% 9.56% 9.61% 5.23% 4.65% 4.97%
5 years 61.65% -- -- 33.77% -- --
10 years 151.25% -- -- 88.81% -- --
Inception 220.10% 9.71% 20.64% 142.37% 5.96% 13.54%
- -------------------------
* The deferred sales charge on redemption of Class B shares is 5% during
the first year, 4% during the second year, 3% during the third year,
2% during the fourth year, 1% during the fifth and sixth years and 0%
during the seventh year and later.
** Performance of Class T Shares of the Growth Portfolio is based on the
historical performance of IDEX Fund from its inception on June 4, 1985
until the reorganization of IDEX Fund and IDEX Fund 3 into Class T
Shares of IDEX Series Fund Growth Portfolio on September 20, 1996; and
the historical performance of Class T Shares of the Growth Portfolio
thereafter.
</TABLE>
58
<PAGE>
The current yield for a particular class of shares of each of the Flexible
Income, Tax-Exempt, Income Plus, Balanced or ^ Strategic Total Return Portfolios
is computed in accordance with a standardized method prescribed by rules of the
Securities and Exchange Commission. The yield is computed by dividing the
Portfolio's investment income per share earned during a particular 30-day base
period (including dividends, if any and interest earned, minus expenses
(excluding reductions for affiliated brokerage and custody earnings credits)
accrued during the period) by the maximum offering price per share on the last
day of the base period and then annualizing the result.
CURRENT YIELD
STRATEGIC TOTAL RETURN 30 Day Period Ended 10/31/96
Class A 1.49%
Class B 0.92%
Class C 1.02%
BALANCED
Class A 2.28%
Class B 1.76%
Class C 1.85%
FLEXIBLE INCOME
Class A 6.14%
Class B 5.82%
Class C 5.92%
INCOME PLUS
Class A 6.43%
Class B 6.08%
Class C 6.19%
The tax equivalent yield of the Tax-Exempt Portfolio is computed by
dividing that portion of the yield (as computed above) which is tax-exempt by
one minus an assumed tax rate of 28% and adding the product to that portion, if
any, of the Portfolio's yield that is not tax-exempt. The tax equivalent yield
of the Tax-Exempt Portfolio's Class A, Class B and Class C shares based on a
30-day period ended October 31, 1996 was 7.31%, 6.78% and 7.33%, respectively.
As stated in the Prospectus, from time to time in advertisements or sales
material, a Portfolio may present and discuss its performance rankings and/or
ratings or other information as published by recognized mutual fund statistical
services or by publications of general interest such as Wall Street Journal,
Boston Globe, New York Times, Los Angeles Times, Christian Science Monitor, USA
Today, Tampa Tribune, St. Petersburg Times, Financial Times, Hartford Current,
International Herald Tribune, Investor's Business Daily, Boston Herald,
Washington Post, Kiplinger's Washington Letter, Kiplinger's Tax Report,
Kiplinger's Personal Finance Magazine, Barron's, Business Week, Financial
Services Week, National Underwriter, Time, Newsweek, Pensions & Investments,
U.S. News and World Report, Morningstar Mutual Fund Values, Economist, Bank
Letter, Boston Business Journal, Research Recommendations, FACS of the Week,
Money, Modern Maturity, Forbes, Fortune, Financial Planner, American Banker,
U.S. Banker, ABA Banking Journal, Institutional Investor (U.S./Europe),
Registered Representative, Independent Agent, American Demographics, Trusts &
Estates, Credit Union Management, Personal Investor, New England Business,
Business Month, Gentlemen's Quarterly, Employee Research Report, Employee
Benefit Plan Review, ICI Mutual Fund News, Succeed, Johnson Charts, Weisenberger
Investment Companies Service, Mutual Fund Quarterly, Financial World Magazine,
Consumer Reports, Babson-United Mutual Fund Selector and Mutual Fund
Encyclopedia (Dearborn Financial Publishing.) . A Portfolio may also advertise
non-standardized performance information which is for period in addition to
those required to be presented, or which provides actual year-by-year return, or
any combination thereof, or both. For Class A, Class B and Class T shares,
non-standardized performance may also be that which does not reflect deduction
of the maximum sales charge applicable to Class A and Class T shares or the
contingent deferred sales charge applicable to Class B shares. In addition, a
Portfolio may, as appropriate, compare its performance to that of other types of
investments such as certificates of deposit, savings accounts and U.S.
Treasuries, or to certain interest rate and inflation indices, such as the
Consumer Price Index. A Portfolio may also advertise various methods of
investing including, among others, dollar cost averaging, and may use
compounding illustrations to show the results of such investment methods. The
Fund or the Distributor may also from time to
59
<PAGE>
time in advertisements or sales material present tables or other information
comparing tax-exempt yields to the equivalent taxable yields, whether with
specific reference to the Tax-Exempt Portfolio or otherwise.
FINANCIAL STATEMENTS
Audited Financial Statements for IDEX Aggressive Growth, Capital
Appreciation, Global, Growth, C.A.S.E., ^ Strategic Total Return, Tactical Asset
Allocation, Balanced, Flexible Income, Income Plus and Tax-Exempt Portfolios
(each, former IDEX II Portfolios) for the one-month period ended October 31,
1996 and the fiscal year ended September 30, 1996 are incorporated by reference
from the Fund's Annual Report dated October 31, 1996 and September 30, 1996,
respectively. No financial information exists for International Equity or Value
Equity Portfolios for the one-month period ended October 31, 1996 and the fiscal
year ended September 30, 1996, as those Portfolios had not commenced operations
as of those dates.
<PAGE>
APPENDIX A
CERTAIN SECURITIES IN WHICH THE PORTFOLIOS MAY INVEST
I. MUNICIPAL OBLIGATIONS IN WHICH THE TAX-EXEMPT PORTFOLIO MAY INVEST
A. MUNICIPAL BONDS
General Information. Municipal Bonds are debt obligations issued to obtain
funds for various public purposes, including the construction of a wide range of
public facilities such as airports, highways, bridges, schools, hospitals,
housing, mass transportation, streets and water and sewer works, and that pay
interest that is exempt from federal income tax in the opinion of issuer's
counsel. Other public purposes for which Municipal Bonds may be issued include
the refunding of outstanding obligations, obtaining funds for general expenses
and obtaining funds to lend to other public institutions and facilities.
The two principal classifications of Municipal Bonds are "general
obligation" bonds and "revenue" or "special tax" bonds. General obligation bonds
are secured by the issuer's pledge of its full faith, credit and taxing power
for the payment of principal and interest. Revenue or special tax bonds are
payable only from the revenues derived from a particular facility or class of
facilities or project or, in some cases, from the proceeds of a special excise
tax or other specific revenue source, but are not supported by the issuer's
power to levy general taxes. Most industrial development bonds are in this
category.
There are, of course, variations in the security of Municipal bonds, both
within a particular classification and between classifications, depending on
numerous factors. The yields of Municipal Bonds depend, among other things, upon
general money market conditions, general conditions of the Municipal Bond
market, size of a particular offering, the maturity of the obligations and
rating of the issue.
Industrial Development Bonds and Private Activity Bonds. Industrial
development bonds ("IDBs") and private activity bonds ("PABs") are issued by or
on behalf of public authorities to finance various privately operated
facilities, such as airports or pollution control facilities. PABs generally are
such bonds issued after August 15, 1986. These obligations are included within
the term "municipal bonds" if the interest paid thereon is exempt from federal
income tax in the option of the bond counsel. IDBs and PABs are in most cases
revenue bonds and thus are not payable from the unrestricted revenues of the
issuer. The credit quality of IDBs and PABs is usually directly related to the
credit standing of the user of the facilities being financed.
Purchases on "When-Issued" or "Delayed Delivery" Basis. Sometimes the
Tax-Exempt Portfolio may buy Municipal Bonds on a "when-issued" or "delayed
delivery" basis. This means that when it agrees to buy, the terms of the Bonds
and the price it will pay are fixed, but it does not purchase and take delivery
of the Bonds until a later date (the "settlement date"), which is usually within
one month. The Tax-Exempt Portfolio pays no money and receives no interest
before the settlement date. The commitment to purchase securities on a
when-issued or delayed delivery basis involves the risk that the market value of
such securities may fall below cost prior to the settlement date. While the
Tax-Exempt Portfolio may sell the Municipal Bonds before the settlement date, it
will ordinarily do so only for investment management reasons. Ordinarily, the
Tax-Exempt Portfolio purchases Municipal Bonds that it has agreed to buy on a
when-issued or delayed delivery basis. Gains or losses on sales prior to the
settlement date are not tax-exempt.
1
<PAGE>
A Municipal Bond purchased on a when-issued or delayed delivery basis is
recorded as an asset on the commitment date. The Tax-Exempt Portfolio will
direct the Fund's custodian to segregate cash, U.S. Government securities or
other appropriate other debt obligations owned by the Portfolio that are at
least equal in value to the amount the Tax-Exempt Portfolio will have to pay on
the settlement date. If necessary, additional assets will be placed in the
account daily so that the value of the account will at least equal the
Portfolio's purchase commitment.
B. MUNICIPAL NOTES
The Tax-Exempt Portfolio may invest in the following types of Municipal
Notes, subject to the quality requirements described in the Prospectus:
Project Notes. Project notes ("PNs") are issued on behalf of local
authorities at auctions conducted by the United States Department of Housing and
Urban Development to raise funds for federally sponsored urban renewal,
neighborhood development and housing programs. PNs are backed by the full faith
and credit of the Federal government through agreements with the local authority
which provide that, if required, the Federal government will lend the issuer an
amount equal to the principal of and interest on the PNs. Ordinarily, PNs are
repaid by rolling over the notes or from the proceeds of new bonds or other
securities which are issued to provide permanent financing.
Bond Anticipation Notes. Bond anticipation notes ("BANs") are usually
general obligations of state and local governmental issuers which are sold to
obtain interim financing for projects that will eventually be funded through the
sale of long-term debt obligations or bonds. The ability of an issuer to meet
its obligations on its BANs is primarily dependent on the issuer's access to the
long-term municipal bond market and the likelihood that the proceeds of such
bond sales will be used to pay the principal and interest on the BANs.
Tax Anticipation Notes. Tax anticipation notes ("TANs") are issued by state
and local governments to finance their current operations. Repayment is
generally to be derived from specific future tax revenues. TANs are usually
general obligations of the issuer. A weakness in an issuer's capacity to raise
taxes due to, among other things, a decline in its tax base or a rise in
delinquencies, could adversely affect the issuer's ability to meet its
obligations on outstanding TANs.
Revenue Anticipation Notes. Revenue anticipation notes ("RANs") are issued
by governments or governmental bodies with the expectation that future revenues
from a designated source will be used to repay the notes. In general, they also
constitute general obligations of the issuer. A decline in the receipt of
projected revenues, such as anticipated revenues from another level of
government, could adversely affect an issuer's ability to meet its obligations
on outstanding RANs. In addition, the possibility that the revenues would, when
received, be used to meet other obligations could affect the ability of the
issuer to pay the principal and interest on RANs.
Construction Loan Notes. Construction loan notes are issued to provide
construction financing for specific projects. Frequently, these notes are
redeemed with funds obtained from the Federal Housing Administration.
Bank Notes. Bank notes are notes issued by local governmental bodies and
agencies as those described above to commercial banks as evidence of borrowings.
Banks on occasion sell such notes to purchasers such as the Tax-Exempt
Portfolio. The purposes for which the notes are issued vary, but bank notes are
frequently issued to meet short-term working-capital or capital-project needs.
These notes typically are redeemed with revenue from taxes or from long-term
financing proceeds, and may have risks similar to the risks associated with TANs
and RANs.
C. MUNICIPAL COMMERCIAL PAPER
Municipal Commercial Paper (also called "short-term discount notes")
represents short-term obligations of state and local governments and their
agencies issued typically to meet seasonal working capital or interim
construction financing requirements. Municipal Commercial Paper is often issued
at a discount, with shorter maturities than Municipal Notes. Such obligations
are repayable from general revenues of the issuer or refinanced with long-term
debt. In most cases, Municipal Commercial Paper is backed by letters of credit,
lending or note repurchase agreements, or other credit facility agreements
offered by banks or other institutions.
2
<PAGE>
While the various types of Municipal Notes and Municipal Commercial Paper
described above as a group represent the major portion of the tax-exempt note
market, other types of notes are occasionally available in the marketplace and
the Tax-Exempt Portfolio may invest in such other types of notes to the extent
permitted under its investment objective and policies. Such short-term
obligations may be issued for different purposes and with different security
than those mentioned above.
D. FLOATING RATE AND VARIABLE RATE OBLIGATIONS
The Tax-Exempt Portfolio may purchase floating rate and variable rate
obligations, including participation interests therein (see section E below).
Investments in floating or variable rate securities normally will include IDBs
which provide that the rate of interest is set as a specific percentage of a
designated base rate, such as the rate on Treasury Bonds or Bills or the prime
rate at a major commercial bank, and that the Portfolio can demand payment of
the obligation on short notice at par value plus accrued interest. Variable rate
securities provide for a specified periodic adjustment in the interest rate,
while floating rate securities have flexible rates that change whenever there is
a change in the designated base interest rate. Frequently, such securities are
secured by letters of credit or other credit support arrangements provided by
banks. The quality of the underlying creditor (i.e., the corporation utilizing
the IDBs financing) or the bank, as the case may be, must be equivalent to the
Municipal Obligation ratings required for purchases for the Tax-Exempt
Portfolio.
E. PARTICIPATION INTERESTS
The Tax-Exempt Portfolio may invest in participation interests purchased
from banks in variable rate tax-exempt securities (such as IDBs) owned by the
banks. A participation interest gives the purchaser an undivided interest in the
tax-exempt security in the proportion that the Portfolio's participation
interest bears to the total principal amount of the tax-exempt security, and
permits demand repurchase as described in section D above. Participations are
frequently backed by an irrevocable letter of credit or guarantee of the bank
offering the participation which the sub-adviser, under the supervision of the
Board of Trustees, has determined meets the prescribed quality standards for the
Tax-Exempt Portfolio. The Portfolio has the right to sell the instrument back to
the bank and draw on the letter of credit on 7 days' notice for all or any part
of the Portfolio's participation interest in the tax-exempt security, plus
accrued interest. The Portfolio intends to exercise its demand rights under the
letter of credit only (1) upon a default under the terms of the tax-exempt
security, (2) as needed to provide liquidity in order to meet redemptions, or
(3) upon a drop in the rating or the sub-adviser's evaluation of the underlying
security. Banks charge a service and letter of credit fee and a fee for issuing
repurchase commitments in an amount equal to the excess of the interest paid on
the tax-exempt securities over the yield negotiated between the Portfolio and
the bank at which the instruments were purchased by the Tax-Exempt Portfolio.
The sub-adviser will monitor the pricing, quality and liquidity of the variable
rate demand instruments held by the Tax-Exempt Portfolio, including the IDBs
supported by bank letters of credit or guarantee, on the basis of published
financial information, reports or rating agencies and other bank analytical
services. Participation interests will be purchased only if, in the opinion of
counsel, interest income on such interest will be tax-exempt when distributed as
dividends to shareholders.
Obligations of issuers of Municipal Bonds, Municipal Notes and Municipal
Commercial Paper are subject to the provisions of bankruptcy, insolvency and
other laws affecting the rights and remedies of creditors, such as the Federal
Bankruptcy Act, and laws, if any, which may be enacted by Congress or state
legislatures extending the time for payment of principal or interest, or
imposing other constraints upon enforcement of such obligations or upon
municipalities' power to levy taxes. There is also the possibility that
litigation or other conditions may materially affect the power or ability of an
issuer to pay, when due, the principal of and interest on its Municipal
Obligations.
II. OBLIGATIONS IN WHICH EACH PORTFOLIO MAY INVEST (UNLESS OTHERWISE NOTED)
A. U.S. GOVERNMENT OBLIGATIONS
As described in the Prospectus, the Portfolios may invest in some or all of
the following types of direct obligations of the Federal Government, issued by
the Department of the Treasury, and backed by the full faith and credit of the
Federal Government.
Treasury Bills. Treasury bills are issued with maturities of up to one
year. They are issued in bearer form, are sold on a discount basis and are
payable at par value at maturity.
3
<PAGE>
Treasury Notes. Treasury Notes are longer-term interest bearing obligations
with original maturities of one to seven years.
Treasury Bonds. Treasury bonds are longer-term interest bearing obligations
with original maturities from 5 to 30 years.
B. OBLIGATIONS OF FEDERAL AGENCIES, INSTRUMENTALITIES AND AUTHORITIES
Certain federal agencies have been established as instrumentalities of the
United States Government to supervise and finance certain types of activities.
These agencies include, but are not limited to, the Banks for Cooperatives,
Federal Land Banks, Federal Intermediate Credit Banks, Federal Home Loan Banks
("FHLB"), Federal National Mortgage Association ("FNMA"), Government National
Mortgage Association ("GNMA"), Export-Import Bank of the United States, and
Tennessee Valley Authority ("TVA"). Issues of these agencies, while not direct
obligations of the United States Government, are either backed by the full faith
and credit of the United States (e.g., GNMA Certificates or certain TVA Bonds)
or are guaranteed by the Treasury (e.g., certain other TVA Bonds) or supported
by the issuing agencies' right to borrow from the Treasury (e.g., FHLB and FNMA
Bonds). There can be no assurance that the United States Government itself will
pay interest and principal on securities as to which it is not legally obligated
to do so.
C. CERTIFICATES OF DEPOSIT (ALL PORTFOLIOS) AND TIME DEPOSITS (INCOME PLUS
PORTFOLIO ONLY)
A time deposit is a non-negotiable interest-bearing deposit with a bank
which generally cannot be withdrawn prior to a specified maturity date without
substantial interest penalties. A certificate of deposit ("CD") is a negotiable
instrument issued by a bank against a time deposit. CDs normally can be traded
in the secondary market prior to maturity, and are thus more liquid than other
forms of time deposits. The Portfolios will only invest in U.S. dollar
denominated time deposits and CDs representing deposits in U.S. Banks with
assets of $1 billion or more, whose deposits are insured by the Federal Deposit
Insurance Corporation.
D. COMMERCIAL PAPER
Commercial paper refers to short-term unsecured promissory notes issued by
commercial and industrial corporations to finance their current operations.
Commercial paper may be issued at a discount and redeemed at par, or issued at
par with interest added at maturity. The interest or discount rate depends on
general interest rates, the credit standing of the issuer, and the maturity of
the note, and generally moves in tandem with rates on large CDs and Treasury
bills. An established secondary market exists for commercial paper, particularly
that of stronger issuers which are rated by Moody's Investors Service, Inc. and
Standard and Poor's Ratings Group. Investments in commercial paper are subject
to the risks that general interest rates will rise, that the credit standing and
outside rating of the issuer will fall, or that the secondary market in the
issuer's notes will become too limited to permit their liquidation at a
reasonable price.
E. BANKER'S ACCEPTANCE
A banker's acceptance is a negotiable short-term draft, generally arising
from a bank customer's commercial transaction with another party, with payment
due for the transaction on the maturity date of the customer's draft. The draft
becomes a banker's acceptance when the bank, upon fulfillment of the obligations
of the third party, accepts the draft for later payment at maturity, thus adding
the bank's guarantee of payment to its customer's own obligation. In effect, a
banker's acceptance is a post-dated certified check payable to its bearer at
maturity. Such acceptances are highly liquid, but are subject to the risk that
both the customer and the accepting bank will be unable to pay at maturity. The
Portfolios may invest in U.S. dollar denominated banker's acceptances issued by
U.S. banks, their foreign branches, and by U.S. branches of foreign banks.
F. REPURCHASE AGREEMENTS FOR U.S. GOVERNMENT SECURITIES (EXCEPT ^ STRATEGIC
TOTAL RETURN PORTFOLIO)
The Portfolios may enter into repurchase agreements with banks and dealers
for securities of or guaranteed by the U.S. Government, under which the
Portfolio purchases securities and agrees to resell the securities at an agreed
upon time and at an agreed upon price. The difference between the amount the
Portfolio pays for the securities and the amount it receives upon resale is
accrued as interest and reflected in the Portfolio's net investment income. When
the Portfolio enters into repurchase agreements, it relies on the seller to
repurchase the securities. Failure to do so may result in a loss for the
Portfolio if the market value of the securities is less than the repurchase
price. Under the Investment Company Act of 1940, repurchase agreements may be
considered collateralized loans by the Portfolio.
4
<PAGE>
At the time a Portfolio enters into a repurchase agreement, the value of
the underlying security including accrued interest will be equal to or exceed
the value of the repurchase agreement and, for repurchase agreements that mature
in more than one day, the seller will agree that the value of the underlying
security including accrued interest will continue to be at least equal to the
value of the repurchase agreement.
Although repurchase agreements carry certain risks not associated with
direct investment in securities, the Portfolios intend to enter into repurchase
agreements only with banks and dealers in transactions which the sub-adviser
believes present minimal credit risks in accordance with guidelines adopted by
the Trustees. To the extent that proceeds from any sales of collateral upon a
default in the counterparty's obligation to repurchase were less than the
repurchase price, the Portfolio would suffer a loss. If the counterpart's
petitions for bankruptcy or otherwise becomes subject to bankruptcy or
liquidation proceedings, there might be restrictions on the Portfolio's ability
to sell the collateral and the Portfolio could suffer a loss.
III. OTHER SECURITIES IN WHICH THE PORTFOLIOS MAY INVEST
A. CORPORATE DEBT SECURITIES
The Portfolio may invest in corporate bonds, notes and debentures of long
and short maturities and of various grades, including unrated securities.
Corporate debt securities exist in great variety, differing from one another in
quality, maturity, and call or other provisions. Lower grade bonds, whether
rated or unrated, usually offer higher interest income, but also carry increased
risk of default. Corporate bonds may be secured or unsecured, senior to or
subordinated to other debt of the issuer, and, occasionally, may be guaranteed
by another entity. In addition, they may carry other features, such as those
described under "Convertible Securities" and "Variable or Floating Rate
Securities", or have special features such as the right of the holder to shorten
or lengthen the maturity of a given debt instrument, rights to purchase
additional securities, rights to elect from among two or more currencies in
which to receive interest or principal payments, or provisions permitting the
holder to participate in earnings of the issuer or to participate in the value
of some specified commodity, financial index, or other measure of value.
B. INTERNATIONAL AGENCY OBLIGATIONS
The Portfolio may invest in bonds, notes or Eurobonds of international
agencies. Examples are securities issued by the Asian Development Bank, the
European Economic Community, and the European Investment Bank. The Portfolio may
also purchase obligations of the International Bank for Reconstruction and
Development which, while technically not a U.S. Government agency or
instrumentality, has the right to borrow from the participating countries,
including the United States.
C. BANK OBLIGATIONS OR SAVINGS AND LOAN OBLIGATIONS
The Portfolios may purchase certificates of deposit, bankers' acceptances
and other debt obligations of commercial banks and certificates of deposit and
other debt obligations of savings and loan associations ("S&L's"). Certificates
of deposit are receipts from a bank or an S&L for funds deposited for a
specified period of time at a specified rate of return. Bankers' acceptance are
time drafts drawn on commercial banks by borrowers, usually in connection with
international commercial transactions. These instruments may be issued by
institutions of any size, may be of any maturity, and may be insured or
uninsured. The quality of bank or savings and loan obligations may be affected
by such factors as (a) location - the strength of the local economy will often
affect financial institutions in the region, (b) asset mix -institutions with
substantial loans in a troubled industry may be weakened by those loans, and (c)
amount of equity capital - -under-capitalized financial institutions are more
vulnerable when loan losses are suffered. The portfolio manager will evaluate
these and other factors affecting the quality of bank and savings and loan
obligations purchased by the Portfolio, but the Portfolio is not restricted to
obligations or institutions which satisfy specified quality criteria.
D. VARIABLE OR FLOATING RATE SECURITIES
The Portfolio may purchase variable rate securities that provide for
automatic establishment of a new interest rate at fixed intervals (e.g., daily,
monthly, semi-annually, etc.). Floating rate securities provide for automatic
adjustment of the interest rate whenever some specified interest rate index
changes. The interest rate on variable and floating rate securities is
ordinarily determined by reference to, or is a percentage of, a bank's prime
rate, the 90-day U.S. Treasury bill rate, the rate of return on commercial paper
or bank certificates of deposit, an index of short-term interest rates, or some
other objective measure.
5
<PAGE>
E. PREFERRED STOCKS (ALL PORTFOLIOS EXCEPT THE TAX-EXEMPT PORTFOLIO)
Preferred stocks are securities which represent an ownership interest in a
corporation and which give the owner a prior claim over common stock on the
corporation's earnings and assets. Preferred stock generally pays quarterly
dividends. Preferred stocks may differ in many of their provisions. Among the
features that differentiate preferred stocks from one another are the dividend
rights, which may be cumulative or non-cumulative and participating or
non-participating, redemption provisions, and voting rights. Such features will
establish the income return and may affect the prospects for capital
appreciation or risks of capital loss.
F. CONVERTIBLE SECURITIES
The Portfolios may invest in debt securities convertible into or
exchangeable for equity securities, or debt securities that carry with them the
right to acquire equity securities, as evidenced by warrants attached to such
securities or acquired as part of units of the securities. Such securities
normally pay less current income than securities without conversion features,
but add the potential opportunity for appreciation from enhanced value for the
equity securities into which they are convertible, and the concomitant risk of
loss from declines in those values.
G. COMMON STOCKS
Each Portfolio (other than the Tax-Exempt Portfolio) invests in common
stocks. The Flexible Income Portfolio will consider investment in
income-producing common stocks if the yields of common stocks generally become
competitive with the yields of other income securities. Common stocks are junior
to the debt obligations and preferred stocks of an issuer. Hence, dividend
payments on common stocks should be regarded as less secure than income payments
on corporate debt securities.
6
<PAGE>
IDEX SERIES FUND
OTHER INFORMATION
PART C
ITEM 24 FINANCIAL STATEMENTS AND EXHIBITS
List all financial statements and exhibits filed as part of the
Registration Statement.
(A) FINANCIAL STATEMENTS:
(1) Audited financial statements of IDEX Aggressive Growth, Capital
Appreciation, Global, Growth, C.A.S.E., Equity-Income, Tactical Asset
Allocation, Balanced, Flexible Income, Income Plus and Tax-Exempt
Portfolios for the one-month period ended October 31, 1996 and for the
fiscal year ended September 30, 1996 included in the IDEX Series
Fund's 1996 Annual Report to Shareholders will be incorporated by
reference into the Statement of Additional Information. No financial
information exists for the IDEX Value Equity or International Equity
Portfolios for the one-month period ended October 31, 1996 or for the
fiscal year ending September 30, 1996, as those Portfolios had not yet
commenced operations.
(2) Financial Highlights of IDEX Aggressive Growth, Capital Appreciation,
Global, Growth, C.A.S.E., Equity- Income, Tactical Asset Allocation,
Balanced, Flexible Income, Income Plus and Tax-Exempt Portfolios are
included on pages 2-30 of the Prospectus.
(B) EXHIBITS:
Exhibit 1 Restatement of Declaration of Trust 1
Exhibit 2 Bylaws, as amended 1
Exhibit 3 Not Applicable
Exhibit 4 Specimen Share Certificate:
(a) Class A Shares
(1) IDEX Aggressive Growth Portfolio 1
(2) IDEX International Equity Portfolio 1
(3) IDEX Capital Appreciation Portfolio 1
(4) IDEX Global Portfolio 1
(5) IDEX Growth Portfolio 1
(6) IDEX C.A.S.E. Portfolio 2
(7) IDEX Value Equity Portfolio 1
(8) IDEX Equity-Income Portfolio 1
(9) IDEX Tactical Asset Allocation Portfolio 3
(10) IDEX Balanced Portfolio 1
(11) IDEX Flexible Income Portfolio 1
(12) IDEX Income Plus Portfolio 1
(13) IDEX Tax Exempt Portfolio
- --------
1 Filed previously with Post-Effective Amendment No. 24 to Registration
Statement filed on November 15, 1996 (File No. 33- 2659). 2 Filed
previously with Post-Effective Amendment No. 20 to Registration Statement
filed on November 17, 1995 (File No. 33- 2659). 3 Filed previously with
Post-Effective Amendment No. 18 to Registration Statement filed on June 30,
1995 (File No. 33-2659).
1
<PAGE>
(b) Class B Shares
(1) IDEX Aggressive Growth Portfolio 1
(2) IDEX International Equity Portfolio 1
(3) IDEX Capital Appreciation Portfolio 1
(4) IDEX Global Portfolio 1
(5) IDEX Growth Portfolio 1
(6) IDEX C.A.S.E. Portfolio 2
(7) IDEX Value Equity Portfolio 1
(8) IDEX Equity-Income Portfolio 1
(9) IDEX Tactical Asset Allocation Portfolio 3
(10) IDEX Balanced Portfolio 1
(11) IDEX Flexible Income Portfolio 1
(12) IDEX Income Plus Portfolio 1
(13) IDEX Tax Exempt Portfolio
(c) Class C Shares
(1) IDEX Aggressive Growth Portfolio 1
(2) IDEX International Equity Portfolio 1
(3) IDEX Capital Appreciation Portfolio 1
(4) IDEX Global Portfolio 1
(5) IDEX Growth Portfolio 1
(6) IDEX C.A.S.E. Portfolio 2
(7) IDEX Value Equity Portfolio 1
(8) IDEX Equity-Income Portfolio 1
(9) IDEX Tactical Asset Allocation Portfolio 3
(10) IDEX Balanced Portfolio 1
(11) IDEX Flexible Income Portfolio 1
(12) IDEX Income Plus Portfolio 1
(13) IDEX Tax Exempt Portfolio
(d) Class T Shares
(1) IDEX Growth Portfolio 4
Exhibit 5 (a) Management and Investment Advisory Agreement
(1) IDEX Aggressive Growth Portfolio 1
(2) IDEX International Equity Portfolio
(3) IDEX Capital Appreciation Portfolio 1
(4) IDEX Global Portfolio 1
(5) IDEX Growth Portfolio
(6) IDEX C.A.S.E. Portfolio 2
(7) IDEX Value Equity Portfolio
(8) IDEX Equity-Income Portfolio 1
(9) IDEX Tactical Asset Allocation Portfolio 3
(10) IDEX Balanced Portfolio 1
(11) IDEX Flexible Income Portfolio 1
(12) IDEX Income Plus Portfolio 1
(13) IDEX Tax-Exempt Portfolio 1
(b) Investment Counsel Agreement
(1) IDEX Aggressive Growth Portfolio 1
(2) (i) IDEX International Equity Portfolio
(ii) IDEX International Equity Portfolio
- --------
4 Filed previously with Registrant's Registration Statement filed on Form
N-14 filed on June 3, 1996 (File No. 333-05113).
2
<PAGE>
(3) IDEX Capital Appreciation Portfolio 1
(4) IDEX Global Portfolio 1
(5) IDEX Growth Portfolio 1
(6) IDEX C.A.S.E. Portfolio 2
(7) IDEX Value Equity Portfolio
(8) IDEX Equity-Income Portfolio 1
(9) IDEX Tactical Asset Allocation Portfolio 3
(10) IDEX Balanced Portfolio 1
(11) IDEX Flexible Income Portfolio 1
(12) IDEX Income Plus Portfolio 1
(13) IDEX Tax-Exempt Portfolio 1
(c) Administrative Services Agreement
(1) IDEX Capital Appreciation Portfolio 1
(2) IDEX Global Portfolio 1
(3) IDEX Growth Portfolio 1
(4) IDEX Balanced Portfolio 1
(5) IDEX Flexible Income Portfolio 1
Exhibit 6 (a) Underwriting Agreement
(b) Dealer's Sales Agreement 1
(c) Service Agreement
(d) Wholesaler's Agreement 2
Exhibit 7 Trustees/Directors Deferred Compensation Plan 2
Exhibit 8 Custody Agreement
Exhibit 9 Transfer Agency Agreement with Idex Investor Services, Inc. 1
Exhibit 10 Opinion of Counsel
Exhibit 11 (a) Consent of Price Waterhouse LLP
(b) Consent of Sutherland Asbill & Brennan
Exhibit 12 Not Applicable
Exhibit 13 Investment Letter from Sole Shareholder 5
Exhibit 14 (a) Model Individual Retirement Plan 1
(b) Model Section 403(b)(7) Plan 1
(c) Model 401(k) Plan 1
Exhibit 15
(a) Plan of Distribution under Rule 12b-1 - Class A Shares
(1) IDEX Aggressive Growth Portfolio 1
(2) IDEX International Equity Portfolio 1
(3) IDEX Capital Appreciation Portfolio 1
(4) IDEX Global Portfolio 1
(5) IDEX Growth Portfolio 1
(6) IDEX C.A.S.E. Portfolio 2
(7) IDEX Value Equity Portfolio 1
(8) IDEX Equity-Income Portfolio 1
- --------
5 Filed previously with Pre-Effective Amendment No. 1 to Registration
Statement filed on March 7, 1986 (File No. 33-2659).
3
<PAGE>
(9) IDEX Tactical Asset Allocation Portfolio 3
(10) IDEX Balanced Portfolio 1
(11) IDEX Flexible Income Portfolio 1
(12) IDEX Income Plus Portfolio 1
(13) IDEX Tax-Exempt Portfolio 1
(b) Plan of Distribution under Rule 12b-1 - Class B Shares
(1) IDEX Aggressive Growth Portfolio 1
(2) IDEX International Equity Portfolio 1
(3) IDEX Capital Appreciation Portfolio 1
(4) IDEX Global Portfolio 1
(5) IDEX Growth Portfolio 1
(6) IDEX C.A.S.E. Portfolio 2
(7) IDEX Value Equity Portfolio 1
(8) IDEX Equity-Income Portfolio 1
(9) IDEX Tactical Asset Allocation Portfolio 3
(10) IDEX Balanced Portfolio 1
(11) IDEX Flexible Income Portfolio 1
(12) IDEX Income Plus Portfolio 1
(13) IDEX Tax Exempt Portfolio 1
(c) Plan of Distribution under Rule 12b-1 - Class C Shares
(1) IDEX Aggressive Growth Portfolio 1
(2) IDEX International Equity Portfolio 1
(3) IDEX Capital Appreciation Portfolio 1
(4) IDEX Global Portfolio 1
(5) IDEX Growth Portfolio 1
(6) IDEX C.A.S.E. Portfolio 2
(7) IDEX Value Equity Portfolio 1
(8) IDEX Equity-Income Portfolio 1
(9) IDEX Tactical Asset Allocation Portfolio 3
(10) IDEX Balanced Portfolio 1
(11) IDEX Flexible Income Portfolio 1
(12) IDEX Income Plus Portfolio 1
(13) IDEX Tax-Exempt Portfolio 1
Exhibit 16
(a) Computation of Performance Quotation
Class A Shares
(1) IDEX Aggressive Growth Portfolio 3
(2) IDEX Capital Appreciation Portfolio 3
(3) IDEX Global Portfolio 6
(4) IDEX Growth Portfolio 7
(5) IDEX C.A.S.E. Portfolio 8
(6) IDEX Equity-Income Portfolio 3
(7) IDEX Tactical Asset Allocation Portfolio 8
(8) IDEX Balanced Portfolio 3
- --------
6 Filed previously with Post-Effective Amendment No. 15 to Registration
Statement filed on December 3, 1993 (File No. 33- 2659). 7 Filed previously
with Post-Effective Amendment No. 14 to Registration Statement filed on
August 2, 1993 (File No. 33- 2659). 8 Filed previously with Post-Effective
Amendment No. 23 to Registration Statement filed on July 19, 1996 (File No.
33-2659).
4
<PAGE>
(9) IDEX Flexible Income Portfolio 9
(10) IDEX Income Plus Portfolio 10
(11) IDEX Tax-Exempt Portfolio 10
(b) Computation of Performance Quotation
Class B Shares
(1) IDEX Aggressive Growth Portfolio 8
(2) IDEX Capital Appreciation Portfolio 8
(3) IDEX Global Portfolio 8
(4) IDEX Growth Portfolio 8
(5) IDEX C.A.S.E. Portfolio 8
(6) IDEX Equity-Income Portfolio 8
(7) IDEX Tactical Asset Allocation Portfolio 8
(8) IDEX Balanced Portfolio 8
(9) IDEX Flexible Income Portfolio 8
(10) IDEX Income Plus Portfolio 8
(11) IDEX Tax-Exempt Portfolio 8
(c) Computation of Performance Quotation
Class C Shares
(1) IDEX Aggressive Growth Portfolio 3
(2) IDEX Capital Appreciation Portfolio 3
(3) IDEX Global Portfolio 2
(4) IDEX Growth Portfolio 2
(5) IDEX C.A.S.E. Portfolio 8
(6) IDEX Equity-Income Portfolio 3
(7) IDEX Tactical Asset Allocation Portfolio 8
(8) IDEX Balanced Portfolio 3
(9) IDEX Flexible Income Portfolio 2
(10) IDEX Income Plus Portfolio 2
(11) IDEX Tax-Exempt Portfolio 2
Exhibit 18 Multiple Class Plan 4
Exhibit 19 Powers of Attorney 3
Exhibit 27
(i) Financial Data Schedule for the fiscal year ended September
30, 1996
(ii) Financial Data Schedule for the one-month ended October 31,
1996
Item 25 Persons Controlled by or under Common Control with Registrant
To the knowledge of the Registrant, IDEX International Equity, Aggressive
Growth, Capital Appreciation, Global, Growth, C.A.S.E., Value Equity,
Equity-Income, Tactical Asset Allocation, Balanced, Flexible Income, Income Plus
and Tax-Exempt Portfolios are not controlled by or under common control with any
other person. The Registrant has no subsidiaries.
ITEM 26 NUMBER OF HOLDERS OF SECURITIES
- ------- -------------------------------
The number of record holders of shares of beneficial interest of the
Registrant as of January 2, 1997, was as follows:
- --------
9 Filed previously with Post-Effective Amendment No. 16 to Registration
Statement filed on October 3, 1994 (File No. 33- 2659). 10 Filed previously
with Post-Effective Amendment No. 7 to Registration Statement filed on
January 17, 1992 (File No. 33- 2659).
5
<PAGE>
Title of Class A Shares Number of Record Holders
Beneficial Interest
IDEX Aggressive Growth Portfolio 5,141
IDEX Capital Appreciation Portfolio 3,063
IDEX Global Portfolio 15,287
IDEX Growth Portfolio 61,626
IDEX C.A.S.E. Portfolio 334
IDEX Equity-Income Portfolio 1,509
IDEX Tactical Asset Allocation Portfolio 900
IDEX Balanced Portfolio 862
IDEX Flexible Income Portfolio 1,350
IDEX Income Plus Portfolio 3,531
IDEX Tax-Exempt Portfolio 1,021
Title of Class B Shares Number of Record Holders
Shares of Beneficial Interest
IDEX Aggressive Growth Portfolio 806
IDEX Capital Appreciation Portfolio 662
IDEX Global Portfolio 1,494
IDEX Growth Portfolio 1,575
IDEX C.A.S.E. Portfolio 176
IDEX Equity-Income Portfolio 407
IDEX Tactical Asset Allocation Portfolio 467
IDEX Balanced Portfolio 156
IDEX Flexible Income Portfolio 48
IDEX Income Plus Portfolio 105
IDEX Tax-Exempt Portfolio 12
Title of Class C Shares Number of Record Holders
Shares of Beneficial Interest
IDEX Aggressive Growth Portfolio 728
IDEX Capital Appreciation Portfolio 490
IDEX Global Portfolio 1,985
IDEX Growth Portfolio 2,333
IDEX C.A.S.E. Portfolio 233
IDEX Equity-Income Portfolio 395
IDEX Tactical Asset Allocation Portfolio 448
IDEX Balanced Portfolio 254
IDEX Flexible Income Portfolio 198
IDEX Income Plus Portfolio 343
IDEX Tax-Exempt Portfolio 145
Title of Class T Shares Number of Record Holders
Shares of Beneficial Interest
IDEX Growth Portfolio 35,700
ITEM 27 INDEMNIFICATION
Provisions relating to indemnification of the Registrant's Trustees and
employees are included in Registrant's Restatement of Declaration of Trust and
Bylaws which are incorporated herein by reference.
6
<PAGE>
ITEM 28 BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISERS
- ------- -----------------------------------------------------
(a). Capital Appreciation, Global, Growth, Balanced and Flexible Income
Portfolios
The only business of Idex Management, Inc. ("IMI") is to serve as the
investment adviser of Capital Appreciation, Global, Growth, Balanced and
Flexible Income Portfolios of IDEX Series Fund.
JanusCapital Corporation ("Janus Capital") serves as sub-adviser to certain
portfolios in the IDEX Series Fund and as investment adviser to each
portfolio of Janus Investment Fund and Janus Aspen Series and as adviser or
sub-adviser to several other mutual funds and private and retirement
accounts. Janus Capital also serves as sub-adviser to certain portfolios of
the WRL Series Fund, Inc. Thomas H. Bailey, Chairman and President of Janus
Capital and Chairman of the Board of Directors of Idex Management, Inc.,
has no business, profession, vocation or employment of a substantial nature
other than his positions with Idex Management, Inc., Janus Investment Fund,
Janus Aspen Series and Janus Capital. Steven R. Goodbarn, Vice President of
Finance, Treasurer and Chief Financial Officer of Janus Capital, Treasurer
and Chief Financial Officer of Janus Investment Fund and Janus Aspen Series
and Director of Idex Management, Inc., has no substantial business,
profession, vocation or employment other than his positions with Janus
Capital, Janus Investment Fund, Janus Aspen Series and Idex Management,
Inc. James P. Craig, James P. Goff, Scott W. Schoelzel, Ronald V. Speaker
and Helen Y. Hayes are Vice Presidents of Janus Capital, and have no
substantial business, profession, vocation or employment other than their
positions with Janus Capital, Janus Investment Fund and Janus Aspen Series.
David C. Tucker is Vice President, Secretary and General Counsel of Janus
Capital, and Vice President and General Counsel of Janus Investment Fund
and Janus Aspen Series; he has no substantial business, profession,
vocation or employment other than his positions with Janus Capital, Janus
Investment Fund and Janus Aspen Series. Michael N. Stolper, a director of
Janus Capital, is President of Stolper & Company, Inc., 525 "B" Street,
Suite 1080, San Diego, CA 92101, an investment performance consultant.
Michael E. Herman, a director of Janus Capital, is Chairman of the Finance
Committee of Ewing Marion Kauffman Foundation, 4900 Oak, Kansas City, MO
64112. Thomas A. McDonnell, a director of Janus Capital, is President,
Chief Executive Officer and a director of DST Systems, Inc., 1004 Baltimore
Avenue, Kansas City, MO 64105, a provider of data processing and
recordkeeping services for various mutual funds (including the IDEX Funds),
and Executive Vice President and a director of Kansas City Southern
Industries, Inc., 114 W. 11th Street, Kansas City, MO, 64105, a publicly
traded holding company whose primary subsidiaries are engaged in
transportation, information processing and financial services. The only
business, professions, vocations or employments of a substantial nature of
Messrs. Kenney, Hurley, Moriarty, Geiger, Franz and Ms. Ferrell, the
remaining officers and directors of Idex Management, Inc., are described
under "Trustees and Officers" in the Statement of Additional Information
included in this Registration Statement.
(b). Aggressive Growth, International Equity, C.A.S.E., Value Equity,
Equity-Income, Tactical Asset Allocation, Income Plus and Tax-Exempt
Portfolios
InterSecurities, Inc. ("ISI") serves as investment adviser to IDEX
Tax-Exempt Portfolio, IDEX Income Plus Portfolio, IDEX Aggressive Growth
Portfolio, IDEX Equity-Income Portfolio, IDEX Tactical Asset Allocation
Portfolio and IDEX C.A.S.E. Portfolio, and serves as principal underwriter
to the Fund. ISI is also a registered broker-dealer engaged in the retail
brokerage of securities. The only business, professions, vocations or
employments of a substantial nature of Messrs. Kenney, Hurley, Moriarty,
Geiger and Franz, officers and directors of ISI, are described under
"Trustees and Officers" in the Statement of Additional Information included
in this Registration Statement. In addition, the following describes the
principal occupations of other officers and directors of ISI: J. Will
Paull, a Director of ISI, is Chairman, President and Chief Executive
Officer of Associated Mariner Financial Group, 17199 N. Laurel Park Drive,
Ste. 100, Livonia, MI 48152-3908, a Financial Holding Company whose primary
subsidiaries are engaged in insurance and financial services; William G.
Cummings, Vice President of ISI, is also Vice President of Associated
Mariner Financial Group; Kristy L. Dowd is a Vice President of ISI; Ronald
L. Hall is a Vice President of ISI; Gerald P. Kirk is a Vice President of
ISI; Gordon E. Hippner is a Vice President of ISI; Cynthia L. Remley, Vice
President and Assistant Secretary of ISI, is also Vice President of Western
Reserve Life and Assistant Secretary of Idex Investor Services, Inc.;
Stanley R. Orr, Vice President of ISI, is also Vice President of Western
Reserve Life; Terry L. Garvin, Vice President of ISI, is also a Vice
President of Western Reserve Life.
* * *
7
<PAGE>
Fred Alger Management, Inc. ("Alger Management"), sub-adviser to the
Aggressive Growth Portfolio, is a wholly owned subsidiary of Fred Alger &
Company, Incorporated ("Alger, Inc.") which in turn is a wholly-owned
subsidiary of Alger Associates, Inc., a financial services holding company.
Alger Management is generally engaged in rendering investment advisory
services to mutual funds, institutions and, to a lesser extent,
individuals.
Fred M. Alger III serves as Chairman of the Board of Alger Associates, Inc.
("Associates"), Alger Management, Alger, Inc., Alger Properties, Inc.
("Properties"), Alger Shareholder Services, Inc. ("Services"), Alger Life
Insurance Agency, Inc. ("Agency"), Fred Alger International Advisory SA
("International") and Analysts Resources, Inc. David D. Alger serves as
President and Director of Associates, Alger Management, Alger Inc.,
Properties, Services, International and Agency; and Executive Vice
President and Director of Analysts Resources, Inc. Gregory S. Duch serves
as Executive Vice President, Treasurer and Director of Alger Management and
Properties; ^ Executive Vice President and Treasurer of Associates, Alger
Inc., Analysts Resources, Inc., Services and Agency; and Treasurer and
Director of International. Mary Marsden-Cochran serves as Secretary of
Associates, Alger Management, Alger Inc., Properties, Analysts Resources,
Inc., Services, International and Agency. The principal business address of
each of the companies listed above, other than Alger, Inc., is 75 Maiden
Lane, New York, NY 10038. The principal business address of Alger, Inc. is
30 Montgomery Street, Jersey City, NJ 07302.
* * *
Scottish Equitable Investment Management Limited ("Scottish Equitable"),
incorporated in Scotland, United Kingdom, serves as sub-adviser to the
International Equity Portfolio. William W. Stewart is Chairman of the Board
and Executive Director, Strategy; Otto Thoresen is Director, International
Business; Niall A.M. Franklin is Finance Director; Russell Hogan is
Director and Chief Investment Officer; Roy Patrick is Director and
Secretary; Paul N. Ritchie is Director and Investment Administration
Manager. The principal address of Scottish Equitable is Edinburgh Park,
Edinburgh EH129SE, Scotland.
GE Investment Management Incorporated ("GEIM"), a Delaware corporation, is
a wholly-owned subsidiary of General Electric Company and a registered
investment adviser under the Investment Advisers Act of 1940, as amended.
GEIM serves as sub-adviser to the International Equity Portfolio. Dale F.
Frey is Chairman, CEO and President; Michael J. Cosgrove, Ralph R. Layman,
John H. Myers, Eugene K. Bolton and Geoffrey R. Norman are Executive Vice
Presidents; Alan M. Lewis is Executive Vice President, General Counsel and
Secretary; Donald W. Torey is Executive Vice President and CFO. The
principal address of GEIM is 3003 Summer Street, Stamford, CT 06905.
* * *
C.A.S.E. Management, Inc. ("C.A.S.E".), sub-adviser to the C.A.S.E.
Portfolio, is a registered investment advisory firm and a wholly-owned
subsidiary of C.A.S.E., Inc. C.A.S.E., Inc. is indirectly controlled by
William Edward Lange, President and Chief Executive Officer of C.A.S.E.
C.A.S.E. provides investment management services to financial institutions,
high net worth individuals, and other professional money managers.
William E. Lange is the President, Chief Executive Officer and Founder;^
Robert G. Errigo, Executive Vice President; John Gordon, Senior Vice
President; Bruce H. Jordan, Senior Vice President; and James M. LaBonte,
Chief Operating Officer. Officers of C.A.S.E. have no other business,
professions, vocations or employments of a substantial nature. The business
address of each of the officers is 2255 Glades Road, Suite 221-A, Boca
Raton, FL 33431.
* * *
NWQ Investment Management Company, Inc. ("NWQ") is a Massachusetts
corporation and is a wholly-owned subsidiary of United Asset Management
Corporation. NWQ provides investment advice to individuals, pension funds,
profit sharing funds, charitable institutions, educational institutions,
trust accounts, corporations, insurance companies, municipalities and
governmental agencies.
8
<PAGE>
NWQ, sub-adviser to the Value Equity Portfolio, is located at 655 Hope
Street, 11th Floor, Los Angeles, CA 90017. David A. Polak is President,
Director & Chief Investment Officer; Edward C. Friedel, Jr. is Director &
Managing Director; James H. Galbreath (Denver) is Director & Managing
Director; Mary-Gene Slaven is Secretary/Treasurer & Managing Director;
James P. Owen is Managing Director; Michael C. Mendez (Scottsdale, AZ) is
Managing Director; Phyllis G. Thomas is Managing Director; Thomas J. Laird
is Managing Director; Jon D. Bosse is Managing Director; Justin T. Clifford
is Managing Director; Louis T. Chambers (Atlanta, GA), Jeffrey M. Cohen,
Paul R. Guastamacchio, Ronald R. Halverson (Minneapolis, MN), Karen S.
McCue, Martin Pollack and Ronald R. Sternal (Minneapolis, MN) are Vice
Presidents.
* * *
Luther King Capital Management Corporation ("Luther King"), sub-adviser to
the Equity-Income Portfolio, is a registered investment adviser providing
investment management services. Luther King also provides investment
management services to individual and institutional investors on a private
basis. J. Luther King, Jr., President of Luther King, Paul W. Greenwell,
Steven R. Purvis, Robert M. Holt, Jr., Scot C. Hollmann, David L. Dowler,
Donald R. Andrews, Joan M. Maynard, Scott M. Kleberg and Barbara S. Garcia,
officers of Luther King, have no substantial business, profession, vocation
or employment other than their positions with Luther King.
* * *
Dean Investment Associates ("Dean Investment"), a division of C.H. Dean and
Associates, Inc., sub-adviser to the Tactical Asset Allocation Portfolio,
is a registered investment adviser providing investment management
services. Dean Investment became a registered investment adviser on March
11, 1974. C.H. Dean and Associates, Inc. was incorporated as an Ohio
corporation on March 28, 1975.
Chauncey H. Dean is the Chairman and Chief Executive Officer; Dennis D.
Dean is President; Frank H. Scott is Senior Vice President; John C. Riazzi
is Vice President and Director of Consulting Services; Robert D. Dean is
Vice President and Director of Research; Richard M. Luthman is Senior Vice
President; Darrell N. Fulton is Vice President of Information Systems. The
business address of each of the officers of Dean Investment is 2480
Kettering Tower, Dayton, OH 45423-2480.
* * *
AEGON USA Investment Management, Inc. ("AEGON Management"), is an Iowa
Corporation which was incorporated on April 12, 1989. AEGON Management
became a registered investment adviser on March 16, 1992 and has assumed
all of the investment advisory functions of AEGON USA Securities, Inc.
("AEGON Securities"). AEGON Management and AEGON Securities are
wholly-owned subsidiaries of AUSA Holding Company, which is a wholly-owned
subsidiary of AEGON USA, Inc.
AEGON Management serves as sub-adviser to Tax-Exempt and Income Plus
Portfolios. Patrick E. Falconio, President, Director and Chairman of the
Board of AEGON Management, is also Executive Vice President and Chief
Investment Officer of AEGON USA, Inc.; Senior Vice President and Director
of AUSA Holding Company and Senior Vice President and Chief Investment
Officer of AUSA Life Insurance Company, Inc. Mr. Falconio is also currently
an officer and/or a director of other AEGON affiliates. Brenda K. Clancy,
Director of AEGON Management, is also Vice President and Controller of
AEGON USA, Inc. Ms. Clancy is also currently an officer and/or director of
other AEGON affiliates. Craig D. Vermie, Director of AEGON Management, is
also Secretary of AUSA Life Insurance Company, Inc. and Vice President and
General Counsel of AEGON USA, Inc. Mr. Vermie is also currently an officer
and/or a director of other AEGON affiliates. Donald E. Flynn, Executive
Vice President of AEGON Management is also a Vice President of AUSA Life
Insurance Company, Inc. Mr. Flynn is also currently an officer and/or
director of other AEGON affiliates. Donald W. Chamberlain, is an Executive
Vice President of AEGON Management; James D. Ross is an Executive Vice
President of AEGON Management; Clifford A. Sheets is an Executive Vice
President of AEGON Management; Ralph M. O'Brien, a Senior Vice President of
AEGON Management, is also a Vice President of AUSA Life Insurance Company,
Inc. Mr. O'Brien is also currently an officer and/or a director of other
AEGON affiliates. Michael Van Meter is a Senior Vice President of AEGON
Management; David R. Halfpap is a Senior Vice President of AEGON Management
and a Vice President of AUSA Life Insurance Company, Inc. Mr. Halfpap is
also currently an officer and/or a director of other AEGON affiliates.
Robert L. Hansen is Vice President of AEGON Management and Vice President
of AUSA Life Insurance Company, Inc.; Jon D. Kettering is Vice President
and Treasurer of AEGON Management and Vice President of AUSA Life Insurance
Company, Inc.; Gregory W. Theobald, Vice President and Secretary of AEGON
Management, is also Vice President and Asst. Secretary of AUSA Life
Insurance Company, Inc. Mr. Theobald
9
<PAGE>
is also currently an officer and/or a director of other AEGON affiliates.
Drew E. Washburn, Kenneth M. Certain, Rachel A. Dennis, Michael N. Meese,
Frederick A. Sabetta, Steven P. Opp, David M. Carney and Lewis O.
Funkhouser are Vice Presidents of AEGON Management. James E. Fine, Brad J.
Beman, Thomas E. Myers and Mary T. Pech are Assistant Vice Presidents of
AEGON Management. Robert S. Jett is Assistant Secretary of AEGON
Management.
* * *
ITEM 29 PRINCIPAL UNDERWRITER
InterSecurities, Inc.
(a) The Registrant has entered into an Underwriting Agreement with
InterSecurities, Inc. ("ISI"), whose address is P.O. Box 9053, Clearwater,
FL 34618-9053, to act as the principal underwriter of Fund shares.
(b) Directors and Officers of Principal Underwriter
Name Positions and Offices Positions and Offices
with Underwriter with Registrant
John R. Kenney Chairman and Director Chairman and Trustee
G. John Hurley President, Chief Executive President, Chief Executive
Officer and Director Officer and Trustee
J. Will Paull Director N/A
William H. Geiger Director and Secretary Vice President and Assistant
Secretary
Thomas R. Moriarty Senior Vice President Senior Vice President,
Treasurer and Principal
Financial Officer
Ronald L. Hall Vice President, Sales Senior Vice President,Sales
and Marketing and Marketing
Kristy L. Dowd Vice President N/A
Becky A. Ferrell Assistant Vice Vice President, Counsel
President, Counsel and and Secretary
Assistant Secretary
Richard B. Franz II Treasurer N/A
Christopher G. Roetzer Assistant Vice President Assistant Vice President and
Principal Accounting Officer
Cynthia L. Remley Vice President, Counsel N/A
and Assistant Secretary
Terry L. Garvin Vice President N/A
Gordon E. Hippner Vice President N/A
Gerard P. Kirk Vice President N/A
Stanley R. Orr Vice President N/A
10
<PAGE>
William G. Cummings Vice President N/A
Diane Rogers Assistant Vice President N/A
Ronald T. Klimas Assistant Vice President N/A
Russell W. Crooks Assistant Vice President N/A
Greg Limardi Assistant Vice President N/A
Christine M. Goodwin Assistant Vice President N/A
Stuart Walsky Assistant Vice President N/A
Laura Schneider Assistant Secretary N/A
ITEM 30 LOCATION OF ACCOUNTS AND RECORDS
- ------- --------------------------------
The accounts, books and other documents required to be maintained by
Section 31(a) of the 1940 Act and the rules promulgated thereunder are
maintained as follows:
(a) Shareholder records are maintained by the Registrant's transfer agent, Idex
Investor Services, Inc., P. O. Box 9015, Clearwater, FL 34618-9015.
(b) All other accounting records of the Registrant are maintained at the
offices of the Registrant at 201 Highland Avenue, Largo, FL, 33770-2957 or
33 N. Garden Avenue, Suites 1000 & 1100, Clearwater, FL 34615, and are in
the physical possession of the officers of the Fund, or at the offices of
the Custodian, Investors Fiduciary Trust Company, 127 West 10th Street,
Kansas City, MO 64105.
ITEM 31 MANAGEMENT SERVICES
The Registrant has no management-related service contract which is not
discussed in Part I of this form. See the section of the Prospectus entitled
"Investment Advisory and Other Services" for a discussion of the management and
advisory services furnished by IMI, ISI, Alger Management, Scottish Equitable,
GEIM, Janus Capital, C.A.S.E., NWQ, Luther King, Dean Investment and AEGON
Management pursuant to the Management and Investment Advisory Agreements, the
Investment Counsel Agreements, the Administrative Services Agreements and the
Underwriting Agreement.
ITEM 32 UNDERTAKINGS
(a) Not applicable
(b) Registrant hereby undertakes to file a Post-Effective Amendment
including the financial statements of IDEX Value Equity and
International Equity Portfolios, which need not be certified, within
four to six months after the effective date of this Post-Effective
Amendment to the Registration Statement.
(c) Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered with a copy of its latest annual report to
shareholders, upon request and without charge.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Registration Statement pursuant to
Rule 485(b) under the Securities Act of 1933 and has duly caused this
Post-Effective Amendment to its Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of Largo and
State of Florida, on the ^ 27th day of ^ January, 1997.
IDEX Series Fund
/S/
By:_______________________________________
G. John Hurley
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933 and Investment
Company Act of 1940, this Post-Effective Amendment to its Registration Statement
has been signed below by the following persons in the capacities and on the
dates indicated:
/s/ John R. Kenney Chairman and Trustee January 27, 1997
- -----------------------------
John R. Kenney
/s/ G. John Hurley President and Trustee January 27, 1997
- ----------------------------- (Principal Executive
G. John Hurley Officer)
/s/ ^ Thomas R. Moriarty Treasurer ^ and Principal January 27, 1997
- ----------------------------- Financial Officer
Thomas R. Moriarty
/s/ Christopher G. Roetzer Assistant Vice President January 27, 1997
- ----------------------------- and Principal Accounting
Christopher G. Roetzer Officer
/s/ Peter R. Brown * Trustee January 27, 1997
- -----------------------------
Peter R. Brown *
/s/ Daniel Calabria* Trustee January 27, 1997
- -----------------------------
Daniel Calabria *
/s/ James L. Churchill * Trustee January 27, 1997
- -----------------------------
James L. Churchill *
/s/ Charles C. Harris * Trustee January 27, 1997
- -----------------------------
Charles C. Harris*
/s/ Julian A. Lerner* Trustee January 27, 1997
- -----------------------------
Julian A. Lerner *
/s/ William W. Short, Jr. * Trustee January 27, 1997
- -----------------------------
William W. Short, Jr. *
/s/ Jack E. Zimmerman * Trustee January 27, 1997
- -----------------------------
Jack E. Zimmerman *
/s/ G. John Hurley
*Signed by G. John Hurley
Attorney in Fact
<PAGE>
CLASS A SHARES OF
IDEX II
TAX-EXEMPT PORTFOLIO
A series of shares of
IDEX II SERIES FUND
(A MASSACHUSETTS BUSINESS TRUST)
SHARES OF BENEFICIAL INTEREST
THIS CERTIFIES that is the owner of ACCOUNT NO. ALPHA CODE
fully paid and non-assessable Class A Shares (without par value) of IDEX II
Tax-Exempt Portfolio, a series of shares (the "Series") of IDEX II Series Fund,
a Massachusetts business trust (the "Trust"), which shares are established and
designated under the Declaration of Trust dated January 7, 1986, and restated as
of August 30, 1991, as amended from time to time (the "Trust Agreement"). The
terms of the Trust Agreement, a copy of which is on file with the Secretary of
the Commonwealth of Massachusetts, are hereby incorporated by reference as fully
as if set down herein in their entirety. As provided in the Trust Agreement, the
beneficial interest in the Series has been divided into classes of Shares, and
the Shares evidenced hereby represent the beneficial interest in an undivided
proportionate part of the assets belonging to the Series subject to the
liabilities belonging to the Series and classes thereof. Such Shares have the
rights and preferences set forth in the Trust Agreement and the Trust will
furnish the holder of this certificate upon written request and without charge a
statement of such rights and preferences. THE SHARES EVIDENCED HEREBY ARE
SUBJECT TO REDEMPTION BY THE TRUST pursuant to the procedures that may be
determined by the Trustees in accordance with the Trust Agreement. This
certificate is issued by the Trustees of the Trust not individually but as
Trustees under the Trust Agreement, and represents shares of beneficial interest
in the Series and does not bind any of the Trustees, shareholders, officers,
employees or agents of the Trust personally but only the assets and property of
the Series. Subject to the provisions of the Trust Agreement, the Class A shares
represented by this certificate are transferable upon the books of the Trust by
the registered holder hereof in person or by its duly authorized attorney upon
surrender of this certificate.
Witness the facsimile signature of the President and Treasurer of the Trust and
the signature of its duly authorized agent.
VOID IF NOT COUNTERSIGNED
COUNTERSIGNED by Idex Investor Services, Inc.
P.O. Box 9015, Clearwater, FL 34618-9015
TRANSFER AGENT
BY
--------------------------------------------
AUTHORIZED SIGNATURE
PLEASE DETACH AND DISCARD UNLESS CHANGES ARE REQUIRED
CLASS A SHARES OF IDEX II TAX-EXEMPT PORTFOLIO
A SERIES OF IDEX II SERIES FUND SHARES
NUMBER IM
ACCOUNT NO. ALPHA CODE DEALER NO. CONFIRM NO.
TRADE DATE CONFIRM DATE BATCH ID. NO.
CHANGE NOTICE: IF THE ABOVE INFORMATION IS INCORRECT OR
MISSING. PLEASE PRINT THE CORRECT INFORMATION BELOW, AND RETURN TO:
IDEX INVESTOR SERVICES, INC.
P.O. BOX 9015
CLEARWATER, FL 34618-9015
TAX IDENT. OR SOC. SEC. NO.
<PAGE>
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full,
according to the applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFTS/TRANSFERS MIN ACT - Custodian
_____________
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right
of survivorship under Uniform Gifts/Transfers to Minors
and not as tenants in common Act _______
(State)
Additionalabbreviations may also be used though
not in the above list.
For value received, ___________ hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
______________________________
______________________________
__________________________________________________________________________
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
__________________________________________________________________________
__________________________________________________________________________Shares
of the Shares represented by the within Certificate, and do hereby irrevocably
constitute and appoint
______________________________________________________________________Attorney
to transfer the said stock on the books of the within-named issuer with full
power of substitution in the premises
Dated, ___________________
__________________________________
Owner
__________________________________
Signature of Co-Owner, if any
IMPORTANT (BEFORE SIGNING, READ AND COMPLY CAREFULLY WITH NOTICE PRINTED ABOVE)
Signature(s) guaranteed by:
___________________________________
Name of Institution
___________________________________
Authorized Signature
(Guarantee stamp must be included)
<PAGE>
NOTICE THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE
NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY
PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE
WHATEVER.
THIS SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION WHO MEETS THE STANDARDS AND PROCEDURES OF THE
TRANSFER AGENT.
<PAGE>
CLASS B SHARES OF
IDEX II
TAX-EXEMPT PORTFOLIO
A series of shares of
IDEX II SERIES FUND
(A MASSACHUSETTS BUSINESS TRUST)
SHARES OF BENEFICIAL INTEREST
THIS CERTIFIES that is the owner of ACCOUNT NO. ALPHA CODE
fully paid and non-assessable Class B Shares (without par value) of IDEX II
Tax-Exempt Portfolio, a series of shares (the "Series") of IDEX II Series Fund,
a Massachusetts business trust (the "Trust"), which shares are established and
designated under the Declaration of Trust dated January 7, 1986, and restated as
of August 30, 1991, as amended from time to time (the "Trust Agreement"). The
terms of the Trust Agreement, a copy of which is on file with the Secretary of
the Commonwealth of Massachusetts, are hereby incorporated by reference as fully
as if set down herein in their entirety. As provided in the Trust Agreement, the
beneficial interest in the Series has been divided into classes of Shares, and
the Shares evidenced hereby represent the beneficial interest in an undivided
proportionate part of the assets belonging to the Series subject to the
liabilities belonging to the Series and classes thereof. Such Shares have the
rights and preferences set forth in the Trust Agreement and the Trust will
furnish the holder of this certificate upon written request and without charge a
statement of such rights and preferences. THE SHARES EVIDENCED HEREBY ARE
SUBJECT TO REDEMPTION BY THE TRUST pursuant to the procedures that may be
determined by the Trustees in accordance with the Trust Agreement. This
certificate is issued by the Trustees of the Trust not individually but as
Trustees under the Trust Agreement, and represents shares of beneficial interest
in the Series and does not bind any of the Trustees, shareholders, officers,
employees or agents of the Trust personally but only the assets and property of
the Series. Subject to the provisions of the Trust Agreement, the Class B shares
represented by this certificate are transferable upon the books of the Trust by
the registered holder hereof in person or by its duly authorized attorney upon
surrender of this certificate.
Witness the facsimile signature of the President and Treasurer of the Trust and
the signature of its duly authorized agent.
VOID IF NOT COUNTERSIGNED
COUNTERSIGNED by Idex Investor Services, Inc.
P.O. Box 9015, Clearwater, FL 34618-9015
TRANSFER AGENT
BY
--------------------------------------------
AUTHORIZED SIGNATURE
PLEASE DETACH AND DISCARD UNLESS CHANGES ARE REQUIRED
CLASS B SHARES OF IDEX II TAX-EXEMPT PORTFOLIO
A SERIES OF IDEX II SERIES FUND SHARES
NUMBER IM
ACCOUNT NO. ALPHA CODE DEALER NO. CONFIRM NO.
TRADE DATE CONFIRM DATE BATCH ID. NO.
CHANGE NOTICE: IF THE ABOVE INFORMATION IS INCORRECT OR
MISSING. PLEASE PRINT THE CORRECT INFORMATION BELOW, AND RETURN TO:
IDEX INVESTOR SERVICES, INC.
P.O. BOX 9015
CLEARWATER, FL 34618-9015
TAX IDENT. OR SOC. SEC. NO.
<PAGE>
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full,
according to the applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFTS/TRANSFERS MIN ACT - Custodian
_____________
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right
of survivorship under Uniform Gifts/Transfers to Minors
and not as tenants in common Act _______
(State)
Additionalabbreviations may also be used though
not in the above list.
For value received, ___________ hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
______________________________
______________________________
__________________________________________________________________________
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
__________________________________________________________________________
__________________________________________________________________________Shares
of the Shares represented by the within Certificate, and do hereby irrevocably
constitute and appoint
______________________________________________________________________Attorney
to transfer the said stock on the books of the within-named issuer with full
power of substitution in the premises
Dated, ___________________
__________________________________
Owner
__________________________________
Signature of Co-Owner, if any
IMPORTANT (BEFORE SIGNING, READ AND COMPLY CAREFULLY WITH NOTICE PRINTED ABOVE)
Signature(s) guaranteed by:
___________________________________
Name of Institution
___________________________________
Authorized Signature
(Guarantee stamp must be included)
<PAGE>
NOTICE THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE
NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY
PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE
WHATEVER.
THIS SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION WHO MEETS THE STANDARDS AND PROCEDURES OF THE
TRANSFER AGENT.
CLASS C SHARES OF
IDEX II
TAX-EXEMPT PORTFOLIO
A series of shares of
IDEX II SERIES FUND
(A MASSACHUSETTS BUSINESS TRUST)
SHARES OF BENEFICIAL INTEREST
THIS CERTIFIES that is the owner of ACCOUNT NO. ALPHA CODE
fully paid and non-assessable Class C Shares (without par value) of IDEX II
Tax-Exempt Portfolio, a series of shares (the "Series") of IDEX II Series Fund,
a Massachusetts business trust (the "Trust"), which shares are established and
designated under the Declaration of Trust dated January 7, 1986, and restated as
of August 30, 1991, as amended from time to time (the "Trust Agreement"). The
terms of the Trust Agreement, a copy of which is on file with the Secretary of
the Commonwealth of Massachusetts, are hereby incorporated by reference as fully
as if set down herein in their entirety. As provided in the Trust Agreement, the
beneficial interest in the Series has been divided into classes of Shares, and
the Shares evidenced hereby represent the beneficial interest in an undivided
proportionate part of the assets belonging to the Series subject to the
liabilities belonging to the Series and classes thereof. Such Shares have the
rights and preferences set forth in the Trust Agreement and the Trust will
furnish the holder of this certificate upon written request and without charge a
statement of such rights and preferences. THE SHARES EVIDENCED HEREBY ARE
SUBJECT TO REDEMPTION BY THE TRUST pursuant to the procedures that may be
determined by the Trustees in accordance with the Trust Agreement. This
certificate is issued by the Trustees of the Trust not individually but as
Trustees under the Trust Agreement, and represents shares of beneficial interest
in the Series and does not bind any of the Trustees, shareholders, officers,
employees or agents of the Trust personally but only the assets and property of
the Series. Subject to the provisions of the Trust Agreement, the Class C shares
represented by this certificate are transferable upon the books of the Trust by
the registered holder hereof in person or by its duly authorized attorney upon
surrender of this certificate.
Witness the facsimile signature of the President and Treasurer of the Trust and
the signature of its duly authorized agent.
VOID IF NOT COUNTERSIGNED
COUNTERSIGNED by Idex Investor Services, Inc.
P.O. Box 9015, Clearwater, FL 34618-9015
TRANSFER AGENT
BY
--------------------------------------------
AUTHORIZED SIGNATURE
PLEASE DETACH AND DISCARD UNLESS CHANGES ARE REQUIRED
CLASS C SHARES OF IDEX II TAX-EXEMPT PORTFOLIO
A SERIES OF IDEX II SERIES FUND SHARES
NUMBER IM
ACCOUNT NO. ALPHA CODE DEALER NO. CONFIRM NO.
TRADE DATE CONFIRM DATE BATCH ID. NO.
CHANGE NOTICE: IF THE ABOVE INFORMATION IS INCORRECT OR
MISSING. PLEASE PRINT THE CORRECT INFORMATION BELOW, AND RETURN TO:
IDEX INVESTOR SERVICES, INC.
P.O. BOX 9015
CLEARWATER, FL 34618-9015
TAX IDENT. OR SOC. SEC. NO.
<PAGE>
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full,
according to the applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFTS/TRANSFERS MIN ACT - Custodian
_____________
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right
of survivorship under Uniform Gifts/Transfers to Minors
and not as tenants in common Act _______
(State)
Additionalabbreviations may also be used though
not in the above list.
For value received, ___________ hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
______________________________
______________________________
__________________________________________________________________________
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
__________________________________________________________________________
__________________________________________________________________________Shares
of the Shares represented by the within Certificate, and do hereby irrevocably
constitute and appoint
______________________________________________________________________Attorney
to transfer the said stock on the books of the within-named issuer with full
power of substitution in the premises
Dated, ___________________
__________________________________
Owner
__________________________________
Signature of Co-Owner, if any
IMPORTANT (BEFORE SIGNING, READ AND COMPLY CAREFULLY WITH NOTICE PRINTED ABOVE)
Signature(s) guaranteed by:
___________________________________
Name of Institution
___________________________________
Authorized Signature
(Guarantee stamp must be included)
<PAGE>
NOTICE THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE
NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY
PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE
WHATEVER.
THIS SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION WHO MEETS THE STANDARDS AND PROCEDURES OF THE
TRANSFER AGENT.
IDEX SERIES FUND
ON BEHALF OF IDEX INTERNATIONAL EQUITY PORTFOLIO
MANAGEMENT AND INVESTMENT ADVISORY AGREEMENT
This Agreement, entered into as of February 1, 1997, is between IDEX SERIES
FUND, a Massachusetts business trust (referred to herein as the "Fund") and
INTERSECURITIES, INC., a Delaware corporation (referred to herein as
"InterSecurities"), to provide certain management and investment advisory
services to a certain series of shares of beneficial interest in the Trust,
namely, IDEX Series Fund International Equity Portfolio (the "Portfolio").
The Fund is registered as an open-end investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"), and consists of more than one
series of shares, including the Portfolio. In managing the Portfolio, as well as
in the conduct of certain of its affairs, the Fund wishes to have the benefit of
the investment advisory services of InterSecurities and its assistance in
performing certain management, administrative and promotional functions.
InterSecurities desires to furnish such services for the Portfolio and to
perform the functions assigned to it under this Agreement for the considerations
provided. Accordingly, the parties have agreed as follows:
1. APPOINTMENT. The Fund hereby appoints InterSecurities as the Portfolio's
investment adviser and administrator for the period and on the terms set forth
in this Agreement. InterSecurities accepts such appointment and agrees to render
or cause to be rendered the services set forth for the compensation herein
specified. In all matters relating to the performance of this Agreement,
InterSecurities will act in conformity with the Fund's Declaration of Trust,
Bylaws and registration statement applicable to the Portfolio and with the
instructions and direction of the Board of Trustees of the Fund, and will
conform to and comply with the 1940 Act and all other applicable federal or
state laws and regulations.
2. INVESTMENT ADVISORY SERVICES. In its capacity as investment adviser to the
Portfolio, InterSecurities shall have the following responsibilities:
(a) to furnish continuous advice and recommendations to the Fund as to the
acquisition, holding or disposition of any or all of the securities or
other assets which the Portfolio may own or contemplate acquiring from
time to time, consistent with the Fund's Declaration of Trust and the
Portfolio's investment objectives and policies adopted and declared by
the Board of Trustees and stated in the Portfolio's current
Prospectus;
(b) to cause the officers of InterSecurities to attend meetings and
furnish oral or written reports, as the Fund may reasonably require,
in order to keep the Trustees and appropriate officers of the Fund
fully informed as to the conditions of the investment securities of
the Portfolio, the investment recommendations of InterSecurities, and
the investment considerations which have given rise to those
recommendations; and
(c) to supervise the purchase and sale of securities as directed by the
appropriate officers of the Fund, including the selection of brokers
and dealers to execute such transactions, consistent with paragraph 10
hereof.
It is understood and agreed that InterSecurities intends to enter into an
Investment Counsel Agreement with each of GE Investment Management Incorporated,
a Delaware corporation ("GE Investments") and Scottish Equitable Investment
Management Limited, a corporation incorporated in Scotland, United Kingdom
("Scottish Equitable"), and that pursuant to those Investment Counsel Agreements
GE Investments and Scottish Equitable will furnish investment information and
advice to assist InterSecurities in carrying out its responsibilities under this
Section 2. The compensation to be paid to GE Investments and Scottish Equitable
for such services and the other terms and conditions under which the services
shall be rendered by GE Investments and Scottish Equitable shall be set forth in
the Investment Counsel Agreements; provided, however, that such Agreements shall
be approved by the Board of Trustees and by the holders of the outstanding
voting securities of the Portfolio in accordance with the requirements of
Section 15 of the 1940 Act, and shall otherwise be subject to, and contain such
provisions as shall be required by, the 1940 Act.
-1-
<PAGE>
3. MANAGEMENT AND ADMINISTRATIVE SERVICES. InterSecurities shall furnish and
perform all administrative services, including recordkeeping, shareholder
relations, regulatory reporting and compliance, supervising and coordinating the
services of the Portfolio's custodian and transfer agent and such other
functions of the Portfolio (other than the investment advisory services provided
for in Section 2), as the parties may agree. InterSecurities shall also assist
in the preparation of reports to shareholders of the Portfolio and prepare sales
literature promoting sale of the Portfolio shares as requested by the Fund.
4. INTERSECURITIES EXPENSES. In addition to the expenses which InterSecurities
may incur in the performance of its services pursuant to Sections 2 and 3 above,
InterSecurities shall incur and pay the following expenses allocable to the
Portfolio's operations:
(a) Reasonable compensation, fees and related expenses of officers of the
Fund and of those Trustees of the Fund who are interested persons (as
that term is defined in Section 2(a)(19) of the 1940 Act) of
InterSecurities; and
(b) Rental of offices for the Portfolio.
5. OBLIGATIONS OF FUND. The Fund shall have the following obligations under this
Agreement:
(a) to keep InterSecurities continuously and fully informed as to the
composition of the investment securities of the Portfolio and the
nature of all of its assets and liabilities from time to time;
(b) to furnish InterSecurities with a certified copy of any financial
statement or report prepared for the Portfolio by certified or
independent public accountants, and with copies of any financial
statements or reports made to its shareholders or to any governmental
body or securities exchange;
(c) to furnish InterSecurities with any further materials or information
which InterSecurities may reasonably request to enable it to perform
its functions under this Agreement; and
(d) to compensate InterSecurities for its services in accordance with the
provisions of Section 6 hereof.
6. COMPENSATION. The Portfolio shall pay to InterSecurities for its services an
annual fee, computed daily and paid monthly, payable on the last day of each
month during which or part of which this Agreement is in effect, equal to 1.00%
of the first $750 million of the Portfolio's average daily net assets, 0.90% of
the next $250 million of the Portfolio's average daily net assets, and 0.85% of
the average daily net assets of the Portfolio in excess of $1 billion. For the
month during which this Agreement becomes effective and the month during which
it terminates, however, there shall be an appropriate proration of the fee
payable for such month based on the number of calendar days of such month during
which this Agreement is effective.
7. EXPENSES PAID BY PORTFOLIO. Subject to the provisions of Section 8, below,
and except as provided in this paragraph, nothing in this Agreement shall be
construed to impose upon InterSecurities the obligation to incur, pay, or
reimburse the Portfolio for any expenses not specifically assumed by
InterSecurities under Sections 2, 3 and 4 above. The Fund shall pay all of its
other expenses (or pay such expenses of the Fund attributable to the Portfolio)
including, but not limited to, custodian and transfer agent fees; advisory fees;
brokerage commissions and all other expenses in connection with the execution of
portfolio transactions; administrative, clerical, recordkeeping, bookkeeping,
legal, auditing and accounting expenses; interest and taxes; expenses of
preparing tax returns; expenses of shareholders' meetings and of preparing,
printing and mailing proxy statements (unless otherwise agreed to by the Fund
and InterSecurities); expenses of preparing and typesetting periodic reports to
its shareholders (except for those reports the Portfolio permits to be used as
sales literature); its allocable share of the fees and expenses of the Fund's
non-interested Trustees; and the costs, including filing fees, of registering
and renewing or maintaining registration of the Portfolio's shares under federal
and state law. Nothing in this Section 7 shall prohibit the Fund from entering
into other agreements or adopting plans which provide for the allocation of
expenses of the Fund or the Portfolio to other entities, or the assumption of
other expenses by the Fund or the Portfolio.
-2-
<PAGE>
8. LIMITATION ON EXPENSES OF PORTFOLIO. Whenever, for any fiscal year, the total
cost to the Portfolio for normal operating expenses chargeable to its income
account, including, but not limited to, the fees of the Portfolio's investment
adviser, the compensation of its custodian, transfer agent, registrar, auditors
and legal counsel, printing expenses, expenses incurred in complying with all
laws applicable to the sale of shares of the Portfolio and any compensation,
fees, or reimbursements which the Portfolio pays to Trustees of the Fund who are
not interested persons (as that phrase is defined in Section 2(a)(29) of the
1940 Act) of InterSecurities, but excluding all interest and all federal, state
and local taxes (such as stamp, excise, income, franchise and similar taxes),
exceeds any expense limitation imposed by applicable state law, InterSecurities
shall reimburse the Portfolio for the amount of said excess in the manner and to
the extent required by state law; provided, however, that during the first full
year of the Portfolio's operation, InterSecurities shall reimburse the Portfolio
for the amount of such expenses, exclusive of expenses incurred pursuant to the
Fund's Plan of Distribution under Rule 12b-1 of the 1940 Act, which exceed 1.35%
of the Fund's average daily net assets for the first full nine months of the
Portfolio's operation, and 1.50% of the Fund's average daily net assets
thereafter. After the first full fiscal year, InterSecurities may continue to
reimburse the Portfolio in this manner, but it shall not be obligated to do so.
9. TREATMENT OF INVESTMENT ADVICE. With respect to the Portfolio, the Fund shall
treat the investment advice and recommendations of InterSecurities as being
advisory only, and shall retain full control over its own investment policies.
However, the Trustees of the Fund may delegate to the appropriate officers of
the Fund, or to a committee of Trustees, the power to authorize purchases, sales
or other actions affecting the securities of the Portfolio in the interim
between meetings of the Trustees, provided such action is consistent with the
established investment policy of the Fund and is reported to the Trustees at
their next meeting.
10. BROKERAGE COMMISSIONS. For purposes of this Agreement, brokerage commissions
paid by the Portfolio upon the purchase or sale of its portfolio securities
shall be considered a cost of securities of the Portfolio and shall be paid by
the Portfolio. InterSecurities is authorized and directed to place the
Portfolio's securities transactions, or to delegate to GE Investments and
Scottish Equitable the authority and direction to place the Portfolio's
securities transactions, only with brokers and dealers who render satisfactory
service in the execution of orders at the most favorable prices and at
reasonable commission rates; provided, however, that InterSecurities or GE
Investments and Scottish Equitable may pay a broker or dealer an amount of
commission for effecting a securities transaction in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction if InterSecurities or GE Investments and Scottish Equitable
determines in good faith that such amount of commission was reasonable in
relation to the value of the brokerage and research services provided by such
broker or dealer viewed in terms of either that particular transaction or the
overall responsibilities of InterSecurities and GE Investments and Scottish
Equitable are also authorized to consider sales of Portfolio shares by a
broker-dealer or the recommendation of a broker-dealer to its customers that
they purchase Portfolio shares as a factor in selecting broker-dealers to
execute the Portfolio's securities transactions, provided that in placing
portfolio business with such broker-dealers, InterSecurities and GE Investments
and Scottish Equitable shall seek the best execution of each transaction and all
such brokerage placement shall be consistent with the Rules of Fair Practice of
the National Association of Securities Dealers, Inc. Notwithstanding the
foregoing, the Fund shall retain the right to direct the placement of all
securities transactions of the Portfolio, and the Trustees may establish
policies or guidelines to be followed by InterSecurities and GE Investments and
Scottish Equitable in placing securities transactions for the Portfolio pursuant
to the foregoing provisions. InterSecurities shall report on the placement of
portfolio transactions each quarter to the Trustees of the Fund.
11. LIABILITY OF INTERSECURITIES. InterSecurities may rely on information
reasonably believed by it to be accurate and reliable. Except as may otherwise
be provided by the 1940 Act, neither InterSecurities nor its officers,
directors, employees or agents shall be subject to any liability to the Fund or
the Portfolio or any shareholder of the Portfolio for any error of judgment,
mistake of law or any loss arising out of any investment or other act or
omission in the course of, connected with or arising out of any service to be
rendered hereunder, except by reason of willful misfeasance, bad faith or gross
negligence in its performance of its duties or by reason of reckless disregard
of its obligations and duties under this Agreement.
12. TERMINATION. This Agreement may be terminated at any time, without penalty,
by the Trustees of the Fund or by the shareholders of the Portfolio acting by
vote of at least a majority of its outstanding voting securities (as that phrase
is defined in Section 2(a)(42) of the 1940 Act), provided in either case that 60
days' written notice of termination be given to InterSecurities at its principal
place of business. This Agreement may be terminated by InterSecurities at any
time by giving 60 days' written notice of termination to the Fund, addressed to
its principal place of business.
-3-
<PAGE>
13. ASSIGNMENT. This Agreement shall terminate automatically in the event of any
assignment (as the term is defined in Section 2(a)(4) of the 1940 Act) of this
Agreement.
14. TERM. This Agreement shall continue in effect, unless sooner terminated in
accordance with its terms, for an initial term ending April 22, 1998, and shall
continue in effect from year to year thereafter only so long as such continuance
is specifically approved at least annually by the vote of a majority of the
Trustees of the Fund who are not parties hereto or interested persons (as that
term is defined in Section 2(a)(19) of the 1940 Act) of any such party, cast in
person at a meeting called for the purpose of voting on the approval of the
terms of such renewal, and by either the Trustees of the Fund or the affirmative
vote of a majority of the outstanding voting securities of the Portfolio (as
that phrase is defined in Section 2(a)(42) of the 1940 Act).
15. AMENDMENTS. The terms of this Agreement may be amended only with the
approval by the affirmative vote of a majority of the outstanding voting
securities of the Portfolio (as that phrase is defined in Section 2(a)(42) of
the 1940 Act) and the approval by the vote of a majority of Trustees of the Fund
who are not parties hereto or interested persons (as that phrase is defined in
Section 2(a)(19) of the 1940 Act) of any such party, cast in person at a meeting
called for the purpose of voting on the approval of such amendment, unless
otherwise permitted in accordance with the 1940 Act.
16. PRIOR AGREEMENTS. This Agreement supersedes all prior agreements between the
parties relating to the subject matter hereof, and all such prior agreements are
deemed terminated upon the effectiveness of this agreement.
17. LIMITATION OF LIABILITY. A copy of the Fund's Declaration of Trust is on
file with the Secretary of The Commonwealth of Massachusetts, and notice is
hereby given that this Agreement is executed on behalf of the Trustees as
Trustees of the Fund and not individually, and that the obligations under this
Agreement are not binding upon any of the Trustees, officers, shareholders,
agents or employees of the Fund individually, but binding only upon the assets
and property of the Portfolio.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
February 1, 1997.
ATTEST: INTERSECURITIES, INC.
/S/ /S/
____________________________ ______________________________
William H. Geiger, Secretary By: G. John Hurley, President and
Chief Executive Officer
ATTEST: IDEX SERIES FUND
/S/ /S/
____________________________ ______________________________
Becky A. Ferrell, Secretary By: G. John Hurley, President and
Chief Executive Officer
-4-
IDEX SERIES FUND
ON BEHALF OF IDEX VALUE EQUITY PORTFOLIO
MANAGEMENT AND INVESTMENT ADVISORY AGREEMENT
This Agreement, entered into as of October 30, 1996, is between IDEX SERIES
FUND, a Massachusetts business trust (referred to herein as the "Fund") and
INTERSECURITIES, INC., a Delaware corporation (referred to herein as
"InterSecurities"), to provide certain management and investment advisory
services to a certain series of shares of beneficial interest in the Trust,
namely, IDEX Series Fund Value Equity Portfolio (the "Portfolio").
The Fund is registered as an open-end investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"), and consists of more than one
series of shares, including the Portfolio. In managing the Portfolio, as well as
in the conduct of certain of its affairs, the Fund wishes to have the benefit of
the investment advisory services of InterSecurities and its assistance in
performing certain management, administrative and promotional functions.
InterSecurities desires to furnish such services for the Portfolio and to
perform the functions assigned to it under this Agreement for the considerations
provided. Accordingly, the parties have agreed as follows:
1. APPOINTMENT. The Fund hereby appoints InterSecurities as the Portfolio's
investment adviser and administrator for the period and on the terms set forth
in this Agreement. InterSecurities accepts such appointment and agrees to render
or cause to be rendered the services set forth for the compensation herein
specified. In all matters relating to the performance of this Agreement,
InterSecurities will act in conformity with the Fund's Declaration of Trust,
Bylaws and registration statement applicable to the Portfolio and with the
instructions and direction of the Board of Trustees of the Fund, and will
conform to and comply with the 1940 Act and all other applicable federal or
state laws and regulations.
2. INVESTMENT ADVISORY SERVICES. In its capacity as investment adviser to the
Portfolio, InterSecurities shall have the following responsibilities:
(a) to furnish continuous advice and recommendations to the Fund as to the
acquisition, holding or disposition of any or all of the securities or
other assets which the Portfolio may own or contemplate acquiring from time
to time, consistent with the Fund's Declaration of Trust and the
Portfolio's investment objectives and policies adopted and declared by the
Board of Trustees and stated in the Portfolio's current Prospectus;
(b) to cause the officers of InterSecurities to attend meetings and furnish
oral or written reports, as the Fund may reasonably require, in order to
keep the Trustees and appropriate officers of the Fund fully informed as to
the conditions of the investment securities of the Portfolio, the
investment recommendations of InterSecurities, and the investment
considerations which have given rise to those recommendations; and
(c) to supervise the purchase and sale of securities as directed by the
appropriate officers of the Fund, including the selection of brokers and
dealers to execute such transactions, consistent with paragraph 10 hereof.
It is understood and agreed that InterSecurities intends to enter into an
Investment Counsel Agreement with NWQ Investment Company, Inc. ("NWQ"), a
Massachusetts corporation, under which NWQ would furnish investment information
and advice to assist InterSecurities in carrying out its responsibilities under
this Section 2. The compensation to be paid to NWQ for such services and the
other terms and conditions under which the services shall be rendered by NWQ
shall be set forth in the Investment Counsel Agreement; provided, however, that
such Agreement shall be approved by the Board of Trustees and by the holders of
the outstanding voting securities of the Portfolio in accordance with the
requirements of Section 15 of the 1940 Act, and shall otherwise be subject to,
and contain such provisions as shall be required by, the 1940 Act.
3. MANAGEMENT AND ADMINISTRATIVE SERVICES. InterSecurities shall furnish and
perform all administrative services, including recordkeeping, shareholder
relations, regulatory reporting and compliance, supervising and coordinating the
services of the Portfolio's custodian and transfer agent and such other
functions of the Portfolio, (other than the investment advisory services
provided for in Section 2), as the parties may agree. InterSecurities shall also
assist in the preparation of reports to
1
<PAGE>
shareholders of the Portfolio and prepare sales literature promoting sale of the
Portfolio shares as requested by the Fund.
4. INTERSECURITIES EXPENSES. In addition to the expenses which InterSecurities
may incur in the performance of its services pursuant to Sections 2 and 3 above,
InterSecurities shall incur and pay the following expenses allocable to the
Portfolio's operations:
(a) Reasonable compensation, fees and related expenses of officers of the Fund
and of those Trustees of the Fund who are interested persons (as that term
is defined in Section 2(a)(19) of the 1940 Act) of InterSecurities; and
(b) Rental of offices for the Portfolio.
5. OBLIGATIONS OF FUND. The Fund shall have the following obligations under this
Agreement:
(a) to keep InterSecurities continuously and fully informed as to the
composition of the investment securities of the Portfolio and the nature of
all of its assets and liabilities from time to time;
(b) to furnish InterSecurities with a certified copy of any financial statement
or report prepared for the Portfolio by certified or independent public
accountants, and with copies of any financial statements or reports made to
its shareholders or to any governmental body or securities exchange;
(c) to furnish InterSecurities with any further materials or information which
InterSecurities may reasonably request to enable it to perform its
functions under this Agreement; and
(d) to compensate InterSecurities for its services in accordance with the
provisions of Section 6 hereof.
6. COMPENSATION. The Portfolio shall pay to InterSecurities for its services an
annual fee, computed daily and paid monthly, payable on the last day of each
month during which or part of which this Agreement is in effect, equal to 1.00%
of first $750 million of the Portfolio's average daily net assets, 0.90% of the
next $250 million of the Portfolio's average daily net assets, and 0.85% of the
average daily net assets of the Portfolio in excess of $1 billion. For the month
during which this Agreement becomes effective and the month during which it
terminates, however, there shall be an appropriate proration of the fee payable
for such month based on the number of calendar days of such month during which
this Agreement is effective.
7. EXPENSES PAID BY PORTFOLIO. Subject to the provisions of Section 8, below,
and except as provided in this paragraph, nothing in this Agreement shall be
construed to impose upon InterSecurities the obligation to incur, pay, or
reimburse the Portfolio for any expenses not specifically assumed by
InterSecurities under Sections 2, 3 and 4 above. The Fund shall pay all of its
other expenses (or pay such expenses of the Fund attributable to the Portfolio)
including, but not limited to, custodian and transfer agent fees; advisory fees;
brokerage commissions and all other expenses in connection with the execution of
portfolio transactions; administrative, clerical, recordkeeping, bookkeeping,
legal, auditing and accounting expenses; interest and taxes; expenses of
preparing tax returns; expenses of shareholders' meetings and of preparing,
printing and mailing proxy statements (unless otherwise agreed to by the Fund
and InterSecurities); expenses of preparing and typesetting periodic reports to
its shareholders (except for those reports the Portfolio permits to be used as
sales literature); its allocable share of the fees and expenses of the Fund's
non-interested Trustees; and the costs, including filing fees, of registering
and renewing or maintaining registration of the Portfolio's shares under federal
and state law. Nothing in this Section 7 shall prohibit the Fund from entering
into other agreements or adopting plans which provide for the allocation of
expenses of the Fund or the Portfolio to other entities, or the assumption of
other expenses by the Fund or the Portfolio.
8. LIMITATION ON EXPENSES OF PORTFOLIO. Whenever, for any fiscal year, the total
cost to the Portfolio for normal operating expenses chargeable to its income
account, including, but not limited to, the fees of the Portfolio's investment
adviser, the compensation of its custodian, transfer agent, registrar, auditors
and legal counsel, printing expenses, expenses incurred in complying with all
laws applicable to the sale of shares of the Portfolio and any compensation,
fees, or reimbursements which the Portfolio pays to Trustees of the Fund who are
not interested persons (as that phrase is defined in Section 2(a)(29) of the
1940 Act) of InterSecurities, but excluding all interest and all federal, state
and local taxes (such as stamp, excise, income, franchise and similar taxes),
exceeds any expense limitation imposed by applicable state law, InterSecurities
shall reimburse the Portfolio for the amount of said excess in the manner and to
the extent required by state law; provided, however, that InterSecurities shall
reimburse the Portfolio for the amount of such expenses, exclusive of expenses
incurred pursuant to the
2
<PAGE>
Fund's Plan of Distribution under Rule 12b-1 of the 1940 Act, which exceed 2.50%
of the Fund's average daily net assets for the first full fiscal year of the
Portfolio, and 1.50% thereafter.
9. TREATMENT OF INVESTMENT ADVICE. With respect to the Portfolio, the Fund shall
treat the investment advice and recommendations of InterSecurities as being
advisory only, and shall retain full control over its own investment policies.
However, the Trustees of the Fund may delegate to the appropriate officers of
the Fund, or to a committee of Trustees, the power to authorize purchases, sales
or other actions affecting the securities of the Portfolio in the interim
between meetings of the Trustees, provided such action is consistent with the
established investment policy of the Fund and is reported to the Trustees at
their next meeting.
10. BROKERAGE COMMISSIONS. For purposes of this Agreement, brokerage commissions
paid by the Portfolio upon the purchase or sale of its portfolio securities
shall be considered a cost of securities of the Portfolio and shall be paid by
the Portfolio. InterSecurities is authorized and directed to place the
Portfolio's securities transactions, or to delegate to NWQ the authority and
direction to place the Portfolio's securities transactions, only with brokers
and dealers who render satisfactory service in the execution of orders at the
most favorable prices and at reasonable commission rates; provided, however,
that InterSecurities or NWQ may pay a broker or dealer an amount of commission
for effecting a securities transaction in excess of the amount of commission
another broker or dealer would have charged for effecting that transaction if
InterSecurities or NWQ determines in good faith that such amount of commission
was reasonable in relation to the value of the brokerage and research services
provided by such broker or dealer viewed in terms of either that particular
transaction or the overall responsibilities of InterSecurities or NWQ
InterSecurities and NWQ are also authorized to consider sales of Portfolio
shares by a broker-dealer or the recommendation of a broker-dealer to its
customers that they purchase Portfolio shares as a factor in selecting
broker-dealers to execute the Portfolio's securities transactions, provided that
in placing portfolio business with such broker-dealers, InterSecurities and NWQ
shall seek the best execution of each transaction and all such brokerage
placement shall be consistent with the Rules of Fair Practice of the National
Association of Securities Dealers, Inc. Notwithstanding the foregoing, the Fund
shall retain the right to direct the placement of all securities transactions of
the Portfolio, and the Trustees may establish policies or guidelines to be
followed by InterSecurities and NWQ in placing securities transactions for the
Portfolio pursuant to the foregoing provisions. InterSecurities shall report on
the placement of portfolio transactions each quarter to the Trustees of the
Fund.
11. LIABILITY OF INTERSECURITIES. InterSecurities may rely on information
reasonable believed by it to be accurate and reliable. Except as may otherwise
be provided by the 1940 Act, neither InterSecurities nor its officers,
directors, employees or agents shall be subject to any liability to the Fund or
the Portfolio or any shareholder of the Portfolio for any error or judgment,
mistake of law or any loss arising out of any investment or other act or
omission in the course of, connected with or arising out of any service to be
rendered hereunder, except by reason of willful misfeasance, bad faith or gross
negligence in its performance of its duties or by reason of reckless disregard
of its obligations and duties under this Agreement.
12. TERMINATION. This Agreement may be terminated at any time, without penalty,
by the Trustees of the Fund or by the shareholders of the Portfolio acting by
vote of at least a majority of its outstanding voting securities (as that phrase
is defined in Section 2(a)(42) of the 1940 Act), provided in either case that 60
days' written notice of termination be given to InterSecurities at its principal
place of business. This Agreement may be terminated by InterSecurities at any
time by giving 60 days' written notice of termination to the Fund, addressed to
its principal place of business.
13. ASSIGNMENT. This Agreement shall terminate automatically in the event of any
assignment (as the term is defined in Section 2(a)(4) of the 1940 Act) of this
Agreement.
14. TERM. This Agreement shall continue in effect, unless sooner terminated in
accordance with its terms, for an initial term ending April 22, 1998, and shall
continue in effect from year to year thereafter only so long as such continuance
is specifically approved at least annually by the vote of a majority of the
Trustees of the Fund who are not parties hereto or interested persons (as that
term is defined in Section 2(a)(19) of the 1940 Act) of any such party, cast in
person at a meeting called for the purpose of voting on the approval of the
terms of such renewal, and by either the Trustees of the Fund or the affirmative
vote of a majority of the outstanding voting securities of the Portfolio (as
that phrase is defined in Section 2(a)(42) of the 1940 Act).
15. AMENDMENTS. The terms of this Agreement may be amended only with the
approval by the affirmative vote of a majority of the outstanding voting
securities of the Portfolio (as that phrase is defined in Section 2(a)(42) of
the 1940 Act) and the approval by the vote of a majority of Trustees of the Fund
who are not parties hereto or interested persons (as that phrase
3
<PAGE>
is defined in Section 2(a)(19) of the 1940 Act) of any such party, cast in
person at a meeting called for the purpose of voting on the approval of such
amendment, unless otherwise permitted in accordance with the 1940 Act.
16. PRIOR AGREEMENTS. This Agreement supersedes all prior agreements between the
parties relating to the subject matter hereof, and all such prior agreements are
deemed terminated upon the effectiveness of this agreement.
17. LIMITATION OF LIABILITY. A copy of the Fund's Declaration of Trust is on
file with the Secretary of The Commonwealth of Massachusetts, and notice is
hereby given that this Agreement is executed on behalf of the Trustees as
Trustees of the Fund and not individually, and that the obligations under this
Agreement are not binding upon any of the Trustees, officers, shareholders,
agents or employees of the Fund individually, but binding only upon the assets
and property of the Portfolio.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
October 30, 1996.
ATTEST: INTERSECURITIES, INC.
/S/ /S/
By:
William H. Geiger, Secretary G. John Hurley
President and Chief Executive Officer
ATTEST: IDEX SERIES FUND
/S/ By: /S/
Becky A. Ferrell, Secretary G. John Hurley
President and Chief Executive Officer
4
IDEX SERIES FUND
ON BEHALF OF IDEX INTERNATIONAL EQUITY PORTFOLIO
INVESTMENT COUNSEL AGREEMENT
This Agreement is entered into as of February 1, 1997, between INTERSECURITIES,
INC., a Delaware corporation (referred to herein as "ISI") and GE INVESTMENT
MANAGEMENT INCORPORATED, a Delaware corporation (referred to herein as "GE
Investments").
WHEREAS, ISI entered into a Management and Investment Advisory Agreement
(referred to herein as the "Advisory Agreement"), dated as of February 1, 1997,
with IDEX Series Fund, a Massachusetts business trust (referred to herein as the
"Fund") on behalf of the IDEX Series Fund International Equity Portfolio (the
"Portfolio"), under which ISI has agreed, among other things, to act as
investment adviser to the Fund;
WHEREAS, the Advisory Agreement provides that ISI may engage GE Investments and
Scottish Equitable Investment Management Limited, a corporation incorporated in
Scotland, United Kingdom (referred to herein as "Scottish Equitable") as
co-sub-advisers to furnish investment information and advice to assist ISI in
carrying out its responsibilities under the Advisory Agreement as investment
adviser to the Portfolio;
WHEREAS, ISI has entered into an Investment Counsel Agreement with Scottish
Equitable regarding the services to be provided by Scottish Equitable on behalf
of the Portfolio, the terms of which are identical to the terms of this
Agreement; and
WHEREAS, it is the purpose of this Agreement to express the mutual agreements of
the parties hereto with respect to the services to be provided by GE Investments
to ISI and the terms and conditions under which such services will be rendered.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, the parties hereto agree as follows:
1. SERVICES OF GE INVESTMENTS. GE Investments shall act as investment counsel to
ISI. In this capacity, GE Investments shall have the following responsibilities:
(a) to furnish continuous investment information, advice and recommendations to
ISI as to the acquisition, holding or disposition of any or all of the
securities or other assets which the Portfolio may own or contemplate
acquiring from time to time;
(b) to cause its officers to attend meetings of ISI or the Fund and furnish
oral or written reports, as ISI may reasonably require, in order to keep
ISI and its officers and the Trustees of the Fund and appropriate officers
of the Fund fully informed as to the condition of the investment portfolio
of the Portfolio, the investment recommendations of GE Investments, and the
investment considerations which have given rise to those recommendations;
(c) to furnish such statistical and analytical information and reports as may
reasonably be required by ISI from time to time;
(d) to supervise the purchase and sale of securities; and
(e) to place orders and negotiate the commissions (if any) for the execution of
transactions in securities or other assets with or through such brokers,
dealers, underwriters or issuers as GE Investments may select in accordance
with the specific authority granted to both ISI and GE Investments under
the terms of the Advisory Agreement with respect to the placement of
brokerage.
2. OBLIGATIONS OF ISI. ISI shall have the following obligations under this
Agreement:
(a) to keep GE Investments continuously and fully informed as to the
composition of the Portfolio's investment portfolio and the nature of the
Portfolio's assets and liabilities from time to time;
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<PAGE>
(b) to furnish GE Investments with a certified copy of any financial statement
or report prepared for the Portfolio by certified or independent public
accountants, and with copies of any financial statements or reports made by
the Fund to its shareholders or to any governmental body or securities
exchange;
(c) to furnish GE Investments with copies of the Fund's Declaration of Trust,
By-laws, and current registration statement and any amendments thereto
applicable to the Portfolio, together with any further materials or
information which GE Investments may reasonably request to enable it to
perform its functions under this Agreement; and
(d) to compensate GE Investments for its services under this Agreement by the
payment of fees equal to (i) 45% of the fees received by ISI pursuant to
Section 6 of the Advisory Agreement for services rendered by ISI to the
Portfolio during the term of this Agreement with respect to the amount of
Portfolio assets managed by GE Investments during such period, less (ii)
45% of any amount reimbursed to the Portfolio by ISI pursuant to the
provisions of Section 8 of the Advisory Agreement with respect to the
amount of Portfolio assets managed by GE Investments during such period. In
the event that this Agreement shall be effective for only part of a period
to which any such fee received by ISI is attributable, then an appropriate
proration of the fee that would have been payable hereunder if this
Agreement had remained in effect until the end of such period shall be
made, based on the number of calendar days in such period and the number of
calendar days during the period in which this Agreement was in effect. The
fees payable to GE Investments hereunder shall be payable upon receipt by
ISI from the Portfolio of fees payable to ISI under Section 6 of the
Advisory Agreement. Any amount borne by GE Investments pursuant to (ii)
above in this paragraph constitutes an agreement between ISI and GE
Investments only for the first twelve months following commencement of the
Portfolio's investment operations. The fee payable to GE Investments
pursuant to this paragraph will not be waived by GE Investments or
otherwise reduced by any waiver or expense limitation affecting the fee
that is payable to ISI under the Advisory Agreement, except as may be
mutually agreed to by GE Investments and ISI. In no event will any amount
to be borne by GE Investments pursuant to (ii) above or pursuant to such
further mutual agreement between GE Investments and ISI exceed the amount
of fee payable to GE Investments pursuant to (i) above in this paragraph.
3. ALLOCATION OF TRANSACTIONS. On occasions when GE Investments deems the
purchase or sale of a security to be in the best interests of the Portfolio as
well as other clients of GE Investments, GE Investments, to the extent permitted
by applicable laws and regulations, may, but shall be under no obligation to,
aggregate the securities to be purchased or sold to attempt to obtain a more
favorable price or lower brokerage commissions and efficient execution. In such
event, allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by GE Investments in the
manner GE Investments considers to be the most equitable and consistent with its
fiduciary obligations to the Portfolio and to its other clients.
4. TREATMENT OF INVESTMENT ADVICE. GE Investments shall supervise and direct the
investment of Portfolio assets managed by it as set forth above consistent with
the Fund's Declaration of Trust and the Portfolio's investment objectives and
policies adopted and declared by the Board of Trustees and stated in the
Portfolio's current Prospectus; provided, however, that ISI may direct GE
Investments to furnish its investment information, advice and recommendations
directly to ISI or to the officers or Trustees of the Fund.
5. SERVICES TO OTHER CLIENTS. Nothing contained in this Agreement shall limit or
restrict (i) the freedom of GE Investments, or any affiliated person thereof, to
render investment advisory, management and corporate administrative services to
any other investment companies, to act as an investment adviser, investment
manager or investment counselor to any other persons, firms or corporations, or
to engage in any other business activities, or (ii) the right of any director,
officer or employee of GE Investments, who may also be a director, officer or
employee of the Fund, to engage in any other business or to devote his or her
time and attention in part to the management or other aspects of any other
business, whether of a similar nature or a dissimilar nature.
6. REPRESENTATIONS AND WARRANTIES OF GE INVESTMENTS. GE Investments represents,
warrants and agrees as follows: GE Investments (i) is registered as an
investment adviser under the Investment Advisers Act of 1940 ("Advisers Act")
-2-
<PAGE>
and will continue to be so registered for so long as this Agreement remains in
effect; (ii) is not prohibited by the 1940 Act or the Advisers Act from
performing the services contemplated by this Agreement; (iii) has met, and will
seek to continue to meet for so long as this Agreement remains in effect, any
other applicable federal or state requirements, or the applicable requirements
of any regulatory or industry self-regulatory agency, necessary to be met in
order to perform the services contemplated by this Agreement; (iv) has the
authority to enter into and perform the services contemplated by this Agreement;
and (v) will promptly notify ISI of the occurrence of any event that would
disqualify GE Investments from serving as an investment adviser of an investment
company pursuant to Section 9(a) of the 1940 Act or otherwise.
7. REPRESENTATIONS AND WARRANTIES OF ISI. ISI represents, warrants and agrees as
follows: ISI (i) is registered as an investment adviser under the Advisers Act
and will continue to be so registered for so long as this Agreement remains in
effect; (ii) is not prohibited by the 1940 Act or the Advisers Act from
performing the services contemplated by the Advisory Agreement; (iii) has met,
and will seek to continue to meet for so long as this Agreement remains in
effect, any other applicable federal or state requirements, or the applicable
requirements of any regulatory or industry self-regulatory agency, necessary to
be met in order to perform the services contemplated by the Advisory Agreement;
(iv) has the authority to enter into and perform the services contemplated by
the Advisory Agreement and has the authority to enter into this Agreement; (v)
will promptly notify GE Investments of the occurrence of any event that would
disqualify ISI from serving as an investment adviser of an investment company
pursuant to Section 9(a) of the 1940 Act or otherwise; and (vi) will notify GE
Investments, to the extent possible, within a reasonable period of time prior to
any termination of this Agreement pursuant to Section 10 which arises from a
termination of the Advisory Agreement (including any termination by assignment
resulting from a foreseeable change in control of ISI that is a matter of public
information).
8. PURCHASES BY AFFILIATES. Neither GE Investments nor any of its officers or
directors shall take a long or short position in the securities issued by the
Fund. This prohibition, however, shall not prevent the purchase from the Fund of
shares issued by the Fund by the officers and directors of GE Investments (or
deferred benefit plans established for their benefit) at the current price
available to the public, or at such price with reductions in sales charge as may
be permitted in the Fund's current prospectus in accordance with Section 22(d)
of the Investment Company Act of 1940.
9. LIABILITY OF GE INVESTMENTS. GE Investments may rely on information
reasonably believed by it to be accurate and reliable. Except as may otherwise
be provided by the Investment Company Act of 1940, neither GE Investments nor
its officers, directors, employees or agents shall be subject to any liability
to the Fund or any shareholders of the Fund for any error of judgment, mistake
of law or any loss arising out of any investment or other act or omission in the
course of, connected with or arising out of any service to be rendered
hereunder, except by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of reckless disregard
of its obligations and duties under this Agreement. ISI agrees to indemnify GE
Investments, its officers and directors, and any person who controls it within
the meaning of Section 15 of the Securities Act of 1933, as amended (the "1933
Act") for any loss or expense (including attorneys' fees) arising out of any
claim, demand, action or suit in the event that GE Investments has been found to
be without fault and ISI or any person who controls ISI within the meaning of
Section 15 of the 1933 Act has been found at fault (i) by the final judgment of
a court of competent jurisdiction or (ii) in any order of settlement of any
claim, demand, action or suit that has been approved by the Board of Directors
of ISI or such other controlling person. GE Investments agrees to indemnify ISI,
its officers and trustees, and any person who controls ISI within the meaning of
Section 15 of the 1933 Act for any loss or expense (including attorneys' fees)
arising out of any claim, demand, action or suit in the event that ISI has been
found to be without fault and GE Investments or any person who controls GE
Investments within the meaning of Section 15 of the 1933 Act has been found at
fault (i) by the final judgment of a court of competent jurisdiction or (ii) in
any order of settlement of any claim, demand, action or suit that has been
approved by the Board of Directors of GE Investments or such other controlling
person.
10. COMPLIANCE WITH LAWS. GE Investments represents that it is, and will
continue to be throughout the term of this Agreement, an investment adviser
registered under all applicable federal and state laws. In all matters relating
to the performance of this Agreement, GE Investments will act in conformity with
the Fund's Declaration of Trust, Bylaws, and current registration statement
applicable to the Portfolio as it may be supplemented from time to time and with
the instructions and direction of ISI and the Fund's Trustees, and will conform
to and comply with the Investment Company Act of 1940, as amended (the "1940
Act") and all other applicable federal or state laws and regulations.
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<PAGE>
11. TERMINATION. This Agreement shall terminate automatically upon the
termination of the Advisory Agreement. This Agreement may be terminated at any
time, without penalty, by ISI or by the Fund by giving 60 days' written notice
of such termination to GE Investments at its principal place of business,
provided that such termination is approved by the Board of Trustees of the Fund
or by vote of a majority of the outstanding voting securities (as that phrase is
defined in Section 2(a)(42) of the 1940 Act) of the Fund. This Agreement may be
terminated at any time by GE Investments by giving 60 days' written notice of
such termination to the Fund and ISI at their respective principal places of
business.
12. ASSIGNMENT. This Agreement shall terminate automatically in the event of any
assignment (as that term is defined in Section 2(a)(4) and the rules thereunder
of the 1940 Act) of this Agreement.
13. TERM. This Agreement shall continue in effect, unless sooner terminated in
accordance with its terms, for an initial term ending April 22, 1998, and shall
continue in effect from year to year thereafter only so long as such continuance
is specifically approved at least annually by the vote of a majority of the
Trustees of the Fund who are not parties hereto or interested persons (as the
term is defined in Section 2(a)(19) of the 1940 Act) of any such party, cast in
person at a meeting called for the purpose of voting on the approval of the
terms of such renewal, and by either the Trustees of the Fund or the affirmative
vote of a majority of the outstanding voting securities of the Fund (as that
phrase is defined in Section 2(a)(42) of the 1940 Act).
14. AMENDMENTS. This Agreement may be amended by an instrument in writing signed
by the party against which enforcement of the amendment is sought. No amendment
shall be effective until it is approved by the affirmative vote of a majority of
the outstanding voting securities of the Portfolio (as that phrase is defined in
Section 2(a)(42) of the 1940 Act) and by the vote of a majority of the Trustees
of the Fund who are not parties hereto or interested persons (as that term is
defined in Section 2(a)(19) of the 1940 Act) of any such party, cast in person
at a meeting called for the purpose of voting on the approval of such amendment,
unless otherwise permitted in accordance with the 1940 Act.
15. PRIOR AGREEMENTS. This Agreement supersedes all prior agreements between the
parties relating to the subject matter hereof, and all such prior agreements are
deemed terminated upon the effectiveness of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
ATTEST: GE INVESTMENT MANAGEMENT INCORPORATED.
/S/ BY: /S/
Michael J. Cosgrove
Assistant Secretary Executive Vice President
ATTEST: INTERSECURITIES, INC.
/S/ BY: /S/
William H. Geiger G. John Hurley
Secretary President and Chief Executive Officer
-4-
IDEX SERIES FUND
ON BEHALF OF IDEX INTERNATIONAL EQUITY PORTFOLIO
INVESTMENT COUNSEL AGREEMENT
This Agreement is entered into as of February 1, 1997, between INTERSECURITIES,
INC., a Delaware corporation (referred to herein as "ISI") and SCOTTISH
EQUITABLE INVESTMENT MANAGEMENT LIMITED, a corporation incorporated in Scotland,
United Kingdom (referred to herein as "Scottish Equitable").
WHEREAS, ISI entered into a Management and Investment Advisory Agreement
(referred to herein as the "Advisory Agreement"), dated as of February 1, 1997,
with IDEX Series Fund, a Massachusetts business trust (referred to herein as the
"Fund") on behalf of the IDEX Series Fund International Equity Portfolio (the
"Portfolio"), under which ISI has agreed, among other things, to act as
investment adviser to the Fund;
WHEREAS, the Advisory Agreement provides that ISI may engage Scottish Equitable
and GE Investment Management Incorporated, a Delaware corporation (referred to
herein as "GE Investments") as co-sub-advisers to furnish investment information
and advice to assist ISI in carrying out its responsibilities under the Advisory
Agreement as investment adviser to the Portfolio;
WHEREAS, ISI has entered into an Investment Counsel Agreement with GE
Investments regarding the services to be provided by GE Investments on behalf of
the Portfolio, the terms of which are identical to the terms of this Agreement;
and
WHEREAS, it is the purpose of this Agreement to express the mutual agreements of
the parties hereto with respect to the services to be provided by Scottish
Equitable to ISI and the terms and conditions under which such services will be
rendered.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, the parties hereto agree as follows:
1. SERVICES OF SCOTTISH EQUITABLE. Scottish Equitable shall act as investment
counsel to ISI. In this capacity, Scottish Equitable shall have the following
responsibilities:
(a) to furnish continuous investment information, advice and recommendations to
ISI as to the acquisition, holding or disposition of any or all of the
securities or other assets which the Portfolio may own or contemplate
acquiring from time to time;
(b) to cause its officers to attend meetings of ISI or the Fund and furnish
oral or written reports, as ISI may reasonably require, in order to keep
ISI and its officers and the Trustees of the Fund and appropriate officers
of the Fund fully informed as to the condition of the investment portfolio
of the Portfolio, the investment recommendations of Scottish Equitable, and
the investment considerations which have given rise to those
recommendations;
(c) to furnish such statistical and analytical information and reports as may
reasonably be required by ISI from time to time;
(d) to supervise the purchase and sale of securities; and
(e) to place orders and negotiate the commissions (if any) for the execution of
transactions in securities or other assets with or through such brokers,
dealers, underwriters or issuers as Scottish Equitable may select in
accordance with the specific authority granted to both ISI and Scottish
Equitable under the terms of the Advisory Agreement with respect to the
placement of brokerage.
2. OBLIGATIONS OF ISI. ISI shall have the following obligations under this
Agreement:
(a) to keep Scottish Equitable continuously and fully informed as to the
composition of the Portfolio's investment portfolio and the nature of the
Portfolio's assets and liabilities from time to time;
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<PAGE>
(b) to furnish Scottish Equitable with a certified copy of any financial
statement or report prepared for the Portfolio by certified or independent
public accountants, and with copies of any financial statements or reports
made by the Fund to its shareholders or to any governmental body or
securities exchange;
(c) to furnish Scottish Equitable with copies of the Fund's Declaration of
Trust, By-laws, and current registration statement and any amendments
thereto applicable to the Portfolio, together with any further materials or
information which Scottish Equitable may reasonably request to enable it to
perform its functions under this Agreement; and
(d) to compensate Scottish Equitable for its services under this Agreement by
the payment of fees equal to (i) 45% of the fees received by ISI pursuant
to Section 6 of the Advisory Agreement for services rendered by ISI to the
Portfolio during the term of this Agreement with respect to the amount of
Portfolio assets managed by Scottish Equitable during such period, less
(ii) 45% of any amount reimbursed to the Portfolio by ISI pursuant to the
provisions of Section 8 of the Advisory Agreement with respect to the
amount of Portfolio assets managed by Scottish Equitable during such
period. In the event that this Agreement shall be effective for only part
of a period to which any such fee received by ISI is attributable, then an
appropriate proration of the fee that would have been payable hereunder if
this Agreement had remained in effect until the end of such period shall be
made, based on the number of calendar days in such period and the number of
calendar days during the period in which this Agreement was in effect. The
fees payable to Scottish Equitable hereunder shall be payable upon receipt
by ISI from the Portfolio of fees payable to ISI under Section 6 of the
Advisory Agreement. Any amount borne by Scottish Equitable pursuant to (ii)
above in this paragraph constitutes an agreement between ISI and Scottish
Equitable only for the first twelve months following commencement of the
Portfolio's investment operations. The fee payable to Scottish Equitable
pursuant to this paragraph will not be waived by Scottish Equitable or
otherwise reduced by any waiver or expense limitation affecting the fee
that is payable to ISI under the Advisory Agreement, except as may be
mutually agreed to by Scottish Equitable and ISI. In no event will any
amount to be borne by Scottish Equitable pursuant to (ii) above or pursuant
to such further mutual agreement between Scottish Equitable and ISI exceed
the amount of fee payable to Scottish Equitable pursuant to (i) above in
this paragraph.
3. ALLOCATION OF TRANSACTIONS. On occasions when Scottish Equitable deems the
purchase or sale of a security to be in the best interests of the Portfolio as
well as other clients of Scottish Equitable, Scottish Equitable, to the extent
permitted by applicable laws and regulations, may, but shall be under no
obligation to, aggregate the securities to be purchased or sold to attempt to
obtain a more favorable price or lower brokerage commissions and efficient
execution. In such event, allocation of the securities so purchased or sold, as
well as the expenses incurred in the transaction, will be made by Scottish
Equitable in the manner Scottish Equitable considers to be the most equitable
and consistent with its fiduciary obligations to the Portfolio and to its other
clients.
4. TREATMENT OF INVESTMENT ADVICE. Scottish Equitable shall supervise and direct
the investment of Portfolio assets managed by it as set forth above consistent
with the Fund's Declaration of Trust and the Portfolio's investment objectives
and policies adopted and declared by the Board of Trustees and stated in the
Portfolio's current Prospectus; provided, however, that ISI may direct Scottish
Equitable to furnish its investment information, advice and recommendations
directly to ISI or to the officers or Trustees of the Fund.
5. SERVICES TO OTHER CLIENTS. Nothing contained in this Agreement shall limit or
restrict (i) the freedom of Scottish Equitable, or any affiliated person
thereof, to render investment advisory, management and corporate administrative
services to any other investment companies, to act as an investment adviser,
investment manager or investment counselor to any other persons, firms or
corporations, or to engage in any other business activities, or (ii) the right
of any director, officer or employee of Scottish Equitable, who may also be a
director, officer or employee of the Fund, to engage in any other business or to
devote his or her time and attention in part to the management or other aspects
of any other business, whether of a similar nature or a dissimilar nature.
6. REPRESENTATIONS AND WARRANTIES OF SCOTTISH EQUITABLE. Scottish Equitable
represents, warrants and agrees as
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<PAGE>
follows: Scottish Equitable (i) is registered as an investment adviser under the
Investment Advisers Act of 1940 ("Advisers Act") and will continue to be so
registered for so long as this Agreement remains in effect; (ii) is not
prohibited by the 1940 Act or the Advisers Act from performing the services
contemplated by this Agreement; (iii) has met, and will seek to continue to meet
for so long as this Agreement remains in effect, any other applicable federal or
state requirements, or the applicable requirements of any regulatory or industry
self-regulatory agency, necessary to be met in order to perform the services
contemplated by this Agreement; (iv) has the authority to enter into and perform
the services contemplated by this Agreement; and (v) will promptly notify ISI of
the occurrence of any event that would disqualify Scottish Equitable from
serving as an investment adviser of an investment company pursuant to Section
9(a) of the 1940 Act or otherwise.
7. REPRESENTATIONS AND WARRANTIES OF ISI. ISI represents, warrants and agrees as
follows: ISI (i) is registered as an investment adviser under the Advisers Act
and will continue to be so registered for so long as this Agreement remains in
effect; (ii) is not prohibited by the 1940 Act or the Advisers Act from
performing the services contemplated by the Advisory Agreement; (iii) has met,
and will seek to continue to meet for so long as this Agreement remains in
effect, any other applicable federal or state requirements, or the applicable
requirements of any regulatory or industry self-regulatory agency, necessary to
be met in order to perform the services contemplated by the Advisory Agreement;
(iv) has the authority to enter into and perform the services contemplated by
the Advisory Agreement and has the authority to enter into this Agreement; (v)
will promptly notify Scottish Equitable of the occurrence of any event that
would disqualify ISI from serving as an investment adviser of an investment
company pursuant to Section 9(a) of the 1940 Act or otherwise; and (vi) will
notify Scottish Equitable, to the extent possible, within a reasonable period of
time prior to any termination of this Agreement pursuant to Section 10 which
arises from a termination of the Advisory Agreement (including any termination
by assignment resulting from a foreseeable change in control of ISI that is a
matter of public information).
8. PURCHASES BY AFFILIATES. Neither Scottish Equitable nor any of its officers
or directors shall take a long or short position in the securities issued by the
Fund. This prohibition, however, shall not prevent the purchase from the Fund of
shares issued by the Fund by the officers and directors of Scottish Equitable
(or deferred benefit plans established for their benefit) at the current price
available to the public, or at such price with reductions in sales charge as may
be permitted in the Fund's current prospectus in accordance with Section 22(d)
of the Investment Company Act of 1940.
9. LIABILITY OF SCOTTISH EQUITABLE. Scottish Equitable may rely on information
reasonably believed by it to be accurate and reliable. Except as may otherwise
be provided by the Investment Company Act of 1940, neither Scottish Equitable
nor its officers, directors, employees or agents shall be subject to any
liability to the Fund or any shareholders of the Fund for any error of judgment,
mistake of law or any loss arising out of any investment or other act or
omission in the course of, connected with or arising out of any service to be
rendered hereunder, except by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of reckless disregard
of its obligations and duties under this Agreement. ISI agrees to indemnify
Scottish Equitable, its officers and directors, and any person who controls it
within the meaning of Section 15 of the Securities Act of 1933, as amended (the
"1933 Act") for any loss or expense (including attorneys' fees) arising out of
any claim, demand, action or suit in the event that Scottish Equitable has been
found to be without fault and ISI or any person who controls ISI within the
meaning of Section 15 of the 1933 Act has been found at fault (i) by the final
judgment of a court of competent jurisdiction or (ii) in any order of settlement
of any claim, demand, action or suit that has been approved by the Board of
Directors of ISI or such other controlling person. Scottish Equitable agrees to
indemnify ISI, its officers and trustees, and any person who controls ISI within
the meaning of Section 15 of the 1933 Act for any loss or expense (including
attorneys' fees) arising out of any claim, demand, action or suit in the event
that ISI has been found to be without fault and Scottish Equitable or any person
who controls Scottish Equitable within the meaning of Section 15 of the 1933 Act
has been found at fault (i) by the final judgment of a court of competent
jurisdiction or (ii) in any order of settlement of any claim, demand, action or
suit that has been approved by the Board of Directors of Scottish Equitable or
such other controlling person.
10. COMPLIANCE WITH LAWS. Scottish Equitable represents that it is, and will
continue to be throughout the term of this Agreement, an investment adviser
registered under all applicable federal and state laws. In all matters relating
to
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<PAGE>
the performance of this Agreement, Scottish Equitable will act in conformity
with the Fund's Declaration of Trust, Bylaws, and current registration statement
applicable to the Portfolio as it may be supplemented from time to time and with
the instructions and direction of ISI and the Fund's Trustees, and will conform
to and comply with the Investment Company Act of 1940, as amended (the "1940
Act") and all other applicable federal or state laws and regulations.
11. TERMINATION. This Agreement shall terminate automatically upon the
termination of the Advisory Agreement. This Agreement may be terminated at any
time, without penalty, by ISI or by the Fund by giving 60 days' written notice
of such termination to Scottish Equitable at its principal place of business,
provided that such termination is approved by the Board of Trustees of the Fund
or by vote of a majority of the outstanding voting securities (as that phrase is
defined in Section 2(a)(42) of the 1940 Act) of the Fund. This Agreement may be
terminated at any time by Scottish Equitable by giving 60 days' written notice
of such termination to the Fund and ISI at their respective principal places of
business.
12. ASSIGNMENT. This Agreement shall terminate automatically in the event of any
assignment (as that term is defined in Section 2(a)(4) and the rules thereunder
of the 1940 Act) of this Agreement.
13. TERM. This Agreement shall continue in effect, unless sooner terminated in
accordance with its terms, for an initial term ending April 22, 1998, and shall
continue in effect from year to year thereafter only so long as such continuance
is specifically approved at least annually by the vote of a majority of the
Trustees of the Fund who are not parties hereto or interested persons (as the
term is defined in Section 2(a)(19) of the 1940 Act) of any such party, cast in
person at a meeting called for the purpose of voting on the approval of the
terms of such renewal, and by either the Trustees of the Fund or the affirmative
vote of a majority of the outstanding voting securities of the Fund (as that
phrase is defined in Section 2(a)(42) of the 1940 Act).
14. AMENDMENTS. This Agreement may be amended by an instrument in writing signed
by the party against which enforcement of the amendment is sought. No amendment
shall be effective until it is approved by the affirmative vote of a majority of
the outstanding voting securities of the Portfolio (as that phrase is defined in
Section 2(a)(42) of the 1940 Act) and by the vote of a majority of the Trustees
of the Fund who are not parties hereto or interested persons (as that term is
defined in Section 2(a)(19) of the 1940 Act) of any such party, cast in person
at a meeting called for the purpose of voting on the approval of such amendment,
unless otherwise permitted in accordance with the 1940 Act.
15. PRIOR AGREEMENTS. This Agreement supersedes all prior agreements between the
parties relating to the subject matter hereof, and all such prior agreements are
deemed terminated upon the effectiveness of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
ATTEST: SCOTTISH EQUITABLE INVESTMENT
MANAGEMENT LIMITED
/S/ /S/
BY:
Secretary Title:
ATTEST: INTERSECURITIES, INC.
/S/ BY:/S/
William H. Geiger G. John Hurley
Secretary President and Chief Executive Officer
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<PAGE>
INVESTMENT COUNSEL AGREEMENT BETWEEN INTERSECURITIES, INC.
AND
SCOTTISH EQUITABLE INVESTMENT MANAGEMENT LIMITED
ADDITIONAL INFORMATION
CONTENTS OF TERMS OF BUSINESS LETTER
1. InterSecurities, Inc. ("ISI") is a non-private customer.
2. Scottish Equitable Investment Management Limited ("Scottish Equitable") is a
member of IMRO and is regulated in the conduct of its investment business by
IMRO.
3. The Investment Counsel Agreement sets out the nature of the services which
Scottish Equitable will provide.
4. Clause 2 of the Investment Counsel Agreement sets out the basis of
remuneration to be paid to Scottish Equitable.
5. The preamble and Clause 9 of the Investment Counsel Agreement specify how the
agreement is to enter into force.
6. Clause 7 of the Investment Counsel Agreement specifies how the agreement may
be terminated. Any termination will be without prejudice to the completion of
advice for transactions already initiated. In respect of transactions in
progress at the date of termination, Scottish Equitable shall take all steps to
effect the satisfactory conclusion to such transactions and ISI undertakes to
pay reasonable fees and expenses in connection with Scottish Equitable so
acting. Termination will not affect any rights intended to survive and will be
without penalty, as provided for in Clause 7 of the Investment Counsel
Agreement.
7. In respect of any complaints arising in respect of the duties to be carried
out by Scottish Equitable, ISI should, initially, give written notification to
Scottish Equitable with a copy to the Compliance Manager C/o Scottish Equitable.
ISI should note that it also has a right of complaint direct to the Investment
Ombudsman.
8. Scottish Equitable is not granted authority to hold client money.
9. Scottish Equitable may from time to time advise on Contingent Liability
Transactions, on the basis of the provisions governing the investment of the
Portfolio applicable from time to time.
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<PAGE>
GLOSSARY OF TERMS
"Contingent Liability Transactions" means a derivatives transaction under the
terms of which there may be a liability to make further payments (other than
charges, and whether or not secured by margin) when the transaction fails to be
completed or upon the earlier closing out of the position.
"Investment Ombudsman" means the person appointed by IMRO for the purpose of the
ombudsman memorandum to consider complaints through investigation and, where
appropriate, adjudication.
-6-
IDEX SERIES FUND
ON BEHALF OF IDEX VALUE EQUITY PORTFOLIO
INVESTMENT COUNSEL AGREEMENT
This Agreement is entered into as of October 30, 1996, between INTERSECURITIES,
INC., a Delaware corporation (referred to herein as "ISI"), and NWQ Investment
Management Company, Inc., a Massachusetts corporation (referred to herein as
"NWQ").
WHEREAS, ISI entered into a Management and Investment Advisory Agreement
(referred to herein as the "Advisory Agreement"), dated October 30, 1996, with
IDEX Series Fund, a Massachusetts business trust (referred to herein as the
"Fund") on behalf of the IDEX Series Fund Value Equity Portfolio (the
"Portfolio"), under which ISI has agreed, among other things, to act as
investment adviser to the Fund;
WHEREAS, the Advisory Agreement provides that ISI may engage NWQ to furnish
investment information and advice to assist ISI in carrying out its
responsibilities under the Advisory Agreement as investment adviser to the
Portfolio; and
WHEREAS, it is the purpose of this Agreement to express the mutual agreements of
the parties hereto with respect to the services to be provided by NWQ to ISI and
the terms and conditions under which such services will be rendered.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, the parties hereto agree as follows:
1. SERVICES OF NWQ. NWQ shall act as investment counsel to ISI. In this
capacity, NWQ shall have the following responsibilities:
(a) to furnish continuous investment information, advice and recommendations to
ISI as to the acquisition, holding or disposition of any or all of the
securities or other assets which the Portfolio may own or contemplate
acquiring from time to time;
(b) to cause its officers to attend meetings of ISI or the Fund and furnish
oral or written reports, as ISI may reasonably require, in order to keep
ISI and its officers and the Trustees of the Fund and appropriate officers
of the Fund fully informed as to the condition of the investment portfolio
of the Portfolio, the investment recommendations of NWQ, and the investment
considerations which have given rise to those recommendations;
(c) to furnish such statistical and analytical information and reports as may
reasonably be required by ISI from time to time; and
(d) to supervise the purchase and sale of securities as directed by the
appropriate officers of the Fund or of ISI.
2. OBLIGATIONS OF ISI. ISI shall have the following obligations under this
Agreement:
(a) to keep NWQ continuously and fully informed as to the composition of the
Portfolio's investment portfolio and the nature of the Portfolio's assets
and liabilities from time to time;
(b) to furnish NWQ with a certified copy of any financial statement or report
prepared for the Portfolio by certified or independent public accountants,
and with copies of any financial statements or reports made by the Fund to
its shareholders or to any governmental body or securities exchange;
(c) to furnish NWQ with copies of the Fund's Declaration of Trust, By-laws, and
current registration statement and any amendments thereto applicable to the
Portfolio, together with any further materials or information which NWQ may
reasonably request to enable it to perform its functions under this
Agreement; and
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<PAGE>
(d) to compensate NWQ for its services under this Agreement by the payment of
fees equal to (i) 40% of the fees received by ISI pursuant to Section 6 of
the Advisory Agreement for services rendered by ISI to the Portfolio during
the term of this Agreement, less (ii) 40% of any amount reimbursed to the
Portfolio by ISI pursuant to the provisions of Section 8 of the Advisory
Agreement. In the event that this Agreement shall be effective for only
part of a period to which any such fee received by ISI is attributable,
then an appropriate proration of the fee that would have been payable
hereunder if this Agreement had remained in effect until the end of such
period shall be made, based on the number of calendar days in such period
and the number of calendar days during the period in which this Agreement
was in effect. The fees payable to NWQ hereunder shall be payable upon
receipt by ISI from the Portfolio of fees payable to ISI under Section 5 of
the Advisory Agreement.
3. TREATMENT OF INVESTMENT ADVICE. ISI shall treat the investment information,
advice and recommendations of NWQ as being advisory only, and shall determine
the extent to which such advice and recommendations shall be passed on to the
Portfolio or incorporated in investment advice by ISI to the Portfolio. ISI may
direct NWQ to furnish its investment information, advice and recommendations
directly to officers or Trustees of the Fund.
4. PURCHASES BY AFFILIATES. Neither NWQ nor any of its officers or Directors
shall take a long or short position in the securities issued by the Fund. This
prohibition, however, shall not prevent the purchase from the Fund of shares
issued by the Fund by the officers and Directors of NWQ (or deferred benefit
plans established for their benefit) at the current price available to the
public, or at such price with reductions in sales charge as may be permitted in
the Fund's current prospectus in accordance with Section 22(d) of the Investment
Company Act of 1940.
5. LIABILITY OF NWQ NWQ may rely on information reasonably believed by it to be
accurate and reliable. Except as may otherwise be provided by the Investment
Company Act of 1940, neither NWQ nor its officers, directors, employees or
agents shall be subject to any liability to the Fund or any shareholders of the
Fund for any error of judgment, mistake of law or any loss arising out of any
investment or other act or omission in the course of, connected with or arising
out of any service to be rendered hereunder, except by reason of willful
misfeasance, bad faith or gross negligence in the performance of its duties or
by reason of reckless disregard of its obligations and duties under this
Agreement.
6. COMPLIANCE WITH LAWS. NWQ represents that it is, and will continue to be
throughout the term of this Agreement, an investment adviser registered under
all applicable federal and state laws. In all matters relating to the
performance of this Agreement, NWQ will act in conformity with the Fund's
Declaration of Trust, Bylaws, and current registration statement applicable to
the Portfolio and with the instructions and direction of ISI and the Fund's
Trustees, and will conform to and comply with the Investment Company Act of
1940, as amended (the "1940 Act") and all other applicable federal or state laws
and regulations.
7. TERMINATION. This Agreement shall terminate automatically upon the
termination of the Advisory Agreement. This Agreement may be terminated at any
time, without penalty, by ISI or by the Fund by giving 60 days' written notice
of such termination to NWQ at its principal place of business, provided that
such termination is approved by the Board of Trustees of the Fund or by vote of
a majority of the outstanding voting securities (as that phrase is defined in
Section 2(a)(42) of the 1940 Act) of the Fund. This Agreement may be terminated
at any time by NWQ. by giving 60 days' written notice of such termination to the
Fund and ISI at their respective principal places of business.
8. ASSIGNMENT. This Agreement shall terminate automatically in the event of any
assignment (as that term is defined in Section 2(a)(4) and the rules thereunder
of the 1940 Act) of this Agreement.
9. TERM. This Agreement shall continue in effect, unless sooner terminated in
accordance with its terms, for an initial term ending April 22, 1998, and shall
continue in effect from year to year thereafter only so long as such continuance
is specifically approved at least annually by the vote of a majority of the
Trustees of the Fund who are not parties hereto or interested persons (as the
term is defined in Section 2(a)(19) of the 1940 Act) of any such party, cast in
person at a meeting called for the purpose of voting on the approval of the
terms of such renewal, and by either the Trustees of the Fund or the affirmative
vote of a majority of the outstanding voting securities of the Fund (as that
phrase is defined in Section 2(a)(42) of the 1940 Act).
-2-
<PAGE>
10. AMENDMENTS. This Agreement may be amended only with the approval by the
affirmative vote of a majority of the outstanding voting securities of the
Portfolio (as that phrase is defined in Section 2(a)(42) of the 1940 Act) and
the approval by the vote of a majority of the Trustees of the Fund who are not
parties hereto or interested persons (as that term is defined in Section
2(a)(19) of the 1940 Act) of any such party, cast in person at a meeting called
for the purpose of voting on the approval of such amendment, unless otherwise
permitted in accordance with the 1940 Act.
11. PRIOR AGREEMENTS. This Agreement supersedes all prior agreements between the
parties relating to the subject matter hereof, and all such prior agreements are
deemed terminated upon the effectiveness of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
ATTEST: NWQ INVESTMENT MANAGEMENT
COMPANY, INC.
/S/ /S/
Mary Gene Sloven BY: David A. Polak, CFA
Secretary Title: President
ATTEST: INTERSECURITIES, INC.
/S/ BY: /S/
William H. Geiger G. John Hurley
Secretary President and Chief Executive Officer
-3-
IDEX SERIES FUND
(FORMERLY IDEX II SERIES FUND)
UNDERWRITING AGREEMENT
This Agreement is entered into as of September 30, 1994, by and between
IDEX Series Fund , a Massachusetts business trust (the "Fund"), and
InterSecurities, Inc. (formerly known as Idex Distributors, Inc.), a Delaware
corporation (the "Distributor").
Whereas, the Fund is registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as an open-end management investment company;
Whereas, the Distributor has served as principal underwriter for the Fund
since its inception;
Whereas, the Fund was formerly known as "Idex II" and the Fund consisted
of, and offered for public sale, only one series of shares of beneficial
interest corresponding to one portfolio;
Whereas, the Fund's Declaration of Trust was amended under a Restatement of
Declaration of Trust dated August 30, 1991 to provide for more than one distinct
series of shares of beneficial interest and for classes of shares;
Whereas, the Fund currently offers for public sale more than one series of
its shares, for each of which series the Distributor serves as the principal
underwriter under an Underwriting Agreement dated April 22, 1993;
1. APPOINTMENT AND AUTHORITY OF AGENT. The Fund appoints the Distributor as
its principal underwriter, to sell shares of the Fund's beneficial interest
during the term of this Agreement. While this Agreement is in force, the
Distributor agrees to use its best efforts to find purchasers for shares of the
Fund. The Distributor shall sell, as agent on behalf of the Fund, the shares
needed, but not more than the shares needed (except for clerical errors and
errors of transmission), to fill unconditional orders placed with the
Distributor, and the price which the Fund shall receive for shares so purchased
shall be the net asset value used in determining the public offering price on
which such orders were based. (The term "net asset value" as used in this
Agreement shall have the meaning assigned to it in the Fund's Bylaws, as amended
from time to time).
The Distributor shall notify the Custodian of the Fund, at the end of each
business day, or as soon thereafter as the orders placed with it in such period
have been compiled, of the number of shares and the prices thereof which the
Distributor shall have sold on behalf of the Fund. The Distributor shall use its
best efforts to cause the sums due for shares ordered from the Fund to be
collected or to be advanced to the Fund on behalf of the purchasers on or before
the seventh business day (excluding Saturdays) after the shares have been so
ordered.
The agency of the Distributor shall be exclusive, except that it shall not
apply to (1) shares issued in connection with the merger or consolidation of any
other investment company or entity with the Fund or the non-taxable acquisition,
by purchase or otherwise, of all (or substantially all) of the assets or the
outstanding shares of any company by the Fund, or (2) shares which may be
offered by the Fund to its shareholders for reinvestment of dividends and
capital gains distributions, whether declared in cash or in shares or cash at
the option of the shareholder.
The Fund may suspend the sale of its shares at any time by notice to the
Distributor for such period of time as the Fund deems desirable. Such a
suspension of sale shall not effect a termination of this Agreement.
2. TERMS OF SALE OF SHARES. The Fund's shares shall be sold by the
Distributor as agent on behalf of the Fund to dealers having sales agreements
with the Distributor and to investors upon the terms and conditions (including
minimum purchase requirements) set forth in the current prospectus relating to
the Fund's shares and (to the extent not inconsistent with said prospectus) upon
the following terms and conditions:
-1 -
<PAGE>
a. PUBLIC OFFERING PRICE. The public offering price, which means the
price per share at which the Distributor or a dealer purchasing shares from
the Fund may sell shares to the public, shall be based upon the per share
net asset value determined as of the time specified in the then current
prospectus relating to the Fund's shares. The public offering price shall
not exceed the per share net asset value on the basis of which the
applicable public offering price is determined plus a sales charge as
described in the then current prospectus relating to the Fund's shares,
which shall not exceed 8.5% of the public offering price. The public
offering price shall be adjusted to the nearer cent. The Distributor shall
fix, in its agreements with dealers, the portion of the sales charge which
may be reallowed to the dealers on the purchase of shares from the Fund.
b. DETERMINATION OF NET ASSET VALUE. The Fund shall determine the net
asset value of the shares of the Fund (or cause such net asset value to be
determined) as of the close of the New York Stock Exchange on each business
day on which said Exchange is open, in accordance with the method set forth
in the Bylaws. Upon due notice to the Distributor, the Fund may also employ
other methods or times in calculation of net asset value, to the extent
authorized by its Bylaws and consistent with applicable federal laws and
rules of the National Association of Securities Dealers, Inc. The Fund
shall also have the right to suspend the sale of its shares and the
calculation of net asset value if, because of some extraordinary condition,
the New York Stock Exchange shall be closed, or if, in the judgment of a
majority of the members of the Board of Trustees of the Fund, or its
Executive Committee, conditions existing during the hours when said
Exchange is open render such action advisable.
c. CONFIRMATIONS. The Distributor shall issue and deliver on behalf of
the Fund or cause to be issued and delivered all confirmations of
transactions effected hereunder for the account of the Fund.
3. NECESSARY ACTION. The Fund agrees that it will, from time to time, but
subject to any necessary approval of its shareholders, take all appropriate
action fixing the number of its authorized shares, and such other steps as may
be necessary to register the same under the Securities Act of 1933, to the end
that there will be available for sale such number of shares as the Distributor
may reasonably be expected to sell. The Fund plans to discontinue sales of its
shares except to existing shareholders when it reaches $500,000,000 in net
assets.
4. INDEMNITY OF FUND BY DISTRIBUTOR. The Distributor will indemnify and
hold harmles the Fund and each of its officers and trustees and each person, if
any, who controls the Fund within the meaning of Section 15 of the Securities
Act of 1933, against any loss, liability, damage, claim, or expense (including
the reasonable cost of investigating or defending any alleged loss, liability,
damage, claim or expense and reasonable counsel fees incurred in connection
therewith), arising by reason of or in connection with any person acquiring any
shares of the Fund, which may be based upon the Securities Act of 1933 or any
other statute or on the common law, on account of any wrongful act of the
Distributor or any of its employees or on the ground that the registration
statement or prospectus, as from time to time amended and supplemented, includes
an untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading, insofar as any such statement or omission was made in
reliance upon, and in conformity with, information furnished to the Fund in
connection therewith by or on behalf of the Distributor, provided, however, that
in no case shall (1) the indemnity of the Distributor in favor of any person
indemnified be deemed to protect the Fund or any such person against any
liability to which the Fund or any such person would otherwise be subject by
reason of willful misfeasance, bad faith, or gross negligence in the performance
of its (or his) duties or by reason of its (or his) reckless disregard of its
(or his) obligations and duties under this Agreement, or (2) the Distributor be
liable under its indemnity agreement contained in this paragraph with respect to
any claim made against the Fund or any person indemnified unless the Fund or
such person, as the case may be, shall have notified the Distributor in writing
within a reasonable time after the summons or first legal process giving notice
of the claim shall have been served upon the Fund or upon such person (or after
the Fund or such person shall have received notice of such service on any
designated agent), but failure to notify the Distributor of any such claim shall
not relieve it from any liability which it may have to the Fund or any person
against whom such action is brought otherwise than on account of its indemnity
agreement contained in this paragraph. In the case of any such notice to the
Distributor, it shall be entitled to participate, at its own expense, in the
defense or, if it so elects, to assume the defense of any suit brought to
enforce any such liability, but, if the Distributor elects to assume the
defense, such defense shall be conducted by counsel chosen by it and
satisfactory to the Fund, and to those of its officers, trustees,
-2 -
<PAGE>
or controlling persons who are defendants in the suit. In the event that the
Distributor elects to assume the defense of any such suit and retain such
counsel, the Fund and those of its officers, trustees or controlling persons who
are defendants in the suit shall bear the fees and expenses of any additional
counsel retained by them, but, in case the Distributor does not elect to assume
the defense of any such suit, it shall reimburse them for the reasonable fees
and expenses of any counsel so retained by them. The Fund agrees to notify the
Distributor promptly of the commencement of any litigation or proceedings
against it in connection with the issue and sale of any of the shares.
5. INDEMNITY OF DISTRIBUTOR BY FUND. The Fund will indemnify and hold
harmless the Distributor and each of its officers and directors and each person,
if any, who controls the Distributor within the meaning of Section 15 of the
Securities Act of 1933 against any loss, liability, claim, damage or expense
(including the reasonable cost of investigating or defending any alleged loss,
liability, claim, damage or expense and reasonable counsel fees incurred in
connection therewith), arising by reason of or in connection with any person
acquiring any of its shares which may be based upon the Securities Act of 1933
or on any other statute or on the common law, on the ground that the
registration statement or prospectus, as from time to time amended and
supplemented, includes an untrue statement of a material fact or omits to state
a material fact required to be stated therein or necessary in order to make the
statement therein not misleading, unless such statement or omission was made in
reliance upon, and in conformity with, information furnished to the Fund in
connection therewith by or on behalf of the Distributor; provided, however, that
in no case shall (1) the indemnity of the Fund in favor of the Distributor and
any such controlling person be deemed to protect the Distributor or any such
controlling person against any liability to which the Distributor (or any such
controlling person) would otherwise be subject by reason of its willful
misfeasance, bad faith, gross negligence in the performance of its (or his)
duties or by reason of its (or his) reckless disregard of its (or his)
obligations and duties under this Agreement, or (2) the Fund be liable under its
indemnity agreement contained in this paragraph with respect to any claim made
against the Distributor (or any such controlling person) unless the Distributor
or such controlling person, as the case may be, shall have notified the Fund in
writing within a reasonable time after the summons or first legal process giving
notice of the claim shall have been served upon the Distributor or upon such
controlling person (or after such Distributor or controlling person shall have
received notice of such service on any designated agent), but failure to notify
the Fund of any such claim shall not relieve it from any liability which it may
have to the person against whom such action is brought otherwise than on account
of its indemnity agreement contained in this paragraph. The Fund will be
entitled to participate at its own expense in the defense or, if it so elects,
to assume the defense of any suit brought to enforce any such liability, but, if
the Fund elects to assume the defense, such defense shall be conducted by
counsel chosen by it and satisfactory to the Distributor and to the controlling
persons who are defendants in the suit. In the event the Fund elects to assume
the defense of any such suit and retain such counsel, the Distributor or persons
who are defendants in the suit shall bear the fees and expenses of any
additional counsel retained by them, but, in case the Fund does not elect to
assume the defense of any such suit, it will reimburse them for the reasonable
fees and expenses of any counsel so retained by them. The Distributor agrees to
notify the Fund promptly of the commencement of any litigation or proceedings
against it or any of its officers or directors in connection with the issuance
or sale of any of the shares.
6. COMPLIANCE WITH SECURITIES LAWS. The Distributor, in selling the shares
of the Fund, will in all respects duly conform with all federal and state laws
relating to the sale of such securities.
7. AUTHORIZED REPRESENTATIONS. Neither the Distributor, any dealer nor any
other person is authorized by the Fund to give any information or to make any
representations, other than those contained in the registration statement or
prospectus filed with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (as said registration statement and
prospectus may be amended or supplemented from time to time), covering the
shares of the Fund, or in such other sales literature as the Fund may expressly
authorize the Distributor to use. No dealer (except the Distributor acting as
agent of the Fund for the account of the Fund) is authorized to act as agent for
the Fund in connection with the offering or sale of shares of the Fund to the
public or otherwise.
8. COSTS TO BE INCURRED BY DISTRIBUTOR. In addition to the expenses which
the Distributor may incur in the performance of its own functions under this
Agreement, and the expenses which it may expressly undertake to pay under other
agreements with the Fund or otherwise, the Distributor will pay:
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<PAGE>
(a) the expenses of printing and distributing prospectuses to persons
other than shareholders and state and federal agencies; and
(b) preparing, printing and distributing all other sales literature
used by the Distributor or by dealers, (including copies of the Fund's
reports to shareholders or federal or state regulatory agencies, other than
those sent to shareholders or federal or state regulatory agencies, which
the Fund may permit to be used as sales literature) in connection with the
offering of Fund shares for sale to the public; and
(c) any expenses of advertising in connection with such offering.
The Fund will pay all of its own expenses, except as expressly provided
herein or in any other agreements which the Fund may have with the Distributor
or any other person.
9. VOLUNTARY REPURCHASE OF SHARES BY THE FUND. The Fund reserves the right,
by resolution of its Board of Trustees, to authorize and require the Distributor
to repurchase, upon prices, terms and conditions to be set forth in such
resolution, as agent of the Fund and for its account, such shares of the Fund as
may be offered for voluntary repurchase by the Fund from time to time.
10. LONG OR SHORT POSITIONS. The Distributor agrees that it will not take
any long or short positions in the shares of the Fund except to the extent
contemplated by paragraphs 1 and 9 above, and that, so far as it can control the
situation, it will prevent any officer or director of (or person financially
interested in) the Distributor from taking any long or short position in the
shares of the Fund, except as permitted by the Declaration of Trust of the Fund
and by those portions of its Bylaws which are not subject to amendment except by
the shareholders of the Fund.
11. AMENDMENTS. This Agreement may be supplemented or amended by mutual
consent of the parties, provided that no amendment hereto shall be effective
unless approved by a majority of the trustees of the Fund who are not interested
persons (as that term is defined in Section 2(a)(19) of the Investment Company
Act of 1940, as amended) of the Distributor, cast in person at a meeting called
for the purpose of voting on such approval. If, at any time during the existence
of this Agreement, the Fund shall in good faith deem it necessary or advisable
in the best interest of the Fund that any amendment of this Agreement be made in
order to comply with the recommendations or requirements of the Securities and
Exchange Commission or other governmental authority or to obtain any proper
advantage under federal or state tax laws, and shall notify the Distributor of
the form of amendment which it deems necessary or advisable and the reasons
therefor, and, if the Distributor declines to assent to such amendment, the Fund
may terminate this Agreement immediately, upon written notice. If, at any time
during the existence of this Agreement, upon request by the Distributor, the
Fund fails (after a reasonable time) to make any changes in its governing
instruments, or in its methods of doing business, which are in good faith deemed
by the Distributor to be necessary in order to comply with federal law or the
lawful requirements of the Securities and Exchange Commission or of the National
Association of Securities Dealers, Inc. relating to the sale of the shares of
the Fund, the Distributor may terminate this Agreement immediately, upon written
notice.
12. COMPENSATION. As compensation for the services performed and the
expenses assumed by the Distributor under this Agreement, including, but not
limited to, remuneration to the Distributor's employees and to other
broker/dealers on the basis of sales of shares, the Fund shall pay the
Distributor a distribution service fee of .25% of the average daily net assets
of the Fund. Such payments have been authorized by the Fund in its Distribution
Plan adopted pursuant to Rule 12b-1 under the Investment Company Act of 1940
("Distribution Plan") and will be limited in accordance with the terms of the
Distribution Plan. Additional payments to the Distributor from the Fund's
investment manager, Idex Management, Inc. or the Fund's investment sub-adviser,
Janus Capital Corporation may be authorized in accordance with applicable law.
13. REPORTS. The Distributor shall prepare written reports for the Board of
Trustees of the Fund on a quarterly basis showing information concerning
services provided and expenses incurred which are related to this
- 4 -
<PAGE>
Agreement and such other information as from time to time shall be reasonably
requested by the Fund's Board of Trustees.
14. TERM. This Agreement shall continue in effect unless sooner terminated
in accordance with its terms for one year from the date hereof and shall
continue in effect from year to year thereafter only so long as such continuance
is specifically approved at least annually by the Board of Trustees of the Fund
or by the affirmative vote of a majority of the outstanding voting securities of
the Fund (as that phrase is defined in Section 2(a)(42) of the Investment
Company Act of 1940, as amended); provided that no renewal hereof shall be
effective unless the terms of such renewal have been approved by the vote of a
majority of the Trustees of the Fund who are not interested parties (as that
term is defined in Section 2(a)(19) of the Investment Company Act of 1940, as
amended) of the Distributor, cast in person at a meeting called for the purpose
of voting on the approval of the terms of such renewal. Either party shall have
the right to terminate this Agreement upon 60 days' written notice given to the
other party.
15. ASSIGNMENT. In the event of the assignment (as defined in Section
2(a)(4) of the Investment Company Act of 1940, as amended) of this Agreement by
the Distributor, this Agreement shall automatically terminate.
16. LIMITATION OF LIABILITY. A copy of the Fund's Declaration of Trust is
on file with the Secretary of The Commonwealth of Massachusetts, and notice is
hereby given that this Agreement is executed on behalf of the Trustees as
Trustees of the Fund and not individually, and that the obligations under this
Agreement are not binding upon any of the Trustees, officers, shareholders,
agents or employees of the Fund individually, but binding only upon the assets
and property of the Fund.
17. PRIOR AGREEMENTS. This agreement supersedes all prior agreements
between the parties relating to the subject matter hereof, and all such prior
agreements are deemed terminated upon the effectiveness of this agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first appearing above.
ATTEST: IDEX SERIES FUND
/S/ /S/
By:
Becky A. Ferrell G. John Hurley
Secretary President and Chief Executive Officer
ATTEST: INTERSECURITIES, INC.
/S/ /S/
By:
William H. Geiger John R. Kenney
Secretary Chairman of the Board
- 5 -
<PAGE>
AMENDMENT TO SCHEDULE I
OF THE UNDERWRITING AGREEMENT BETWEEN
IDEX SERIES FUND AND INTERSECURITIES, INC.
The following series and classes of shares are offered for public sale by IDEX
Series Fund:
IDEX Growth Portfolio IDEX Balanced Portfolio
Class A Class A
Class B Class B
Class C Class C
IDEX Global Portfolio IDEX Capital Appreciation Portfolio
Class A Class A
Class B Class B
Class C Class C
IDEX Flexible Income Portfolio IDEX Aggressive Growth Portfolio
Class A Class A
Class B Class B
Class C Class C
IDEX Tax-Exempt Portfolio IDEX Strategic Total Return Portfolio
Class A Class A
Class B Class B
Class C Class C
IDEX Income Plus Portfolio IDEX Tactical Asset Allocation Portfolio
Class A Class A
Class B Class B
Class C Class C
IDEX C.A.S.E. Portfolio IDEX International Equity Portfolio
Class A Class A
Class B Class B
Class C Class C
IDEX Value Equity Portfolio
Class A
Class B
Class C
Effective as of February 1, 1997.
ATTEST: IDEX SERIES FUND
/S/ /S/
____________________________ By: ______________________________
Becky A. Ferrell, Secretary G. John Hurley, President and
Chief Executive Officer
ATTEST: INTERSECURITIES, INC.
/S/ /S/
____________________________ By: ______________________________
William H. Geiger, Secretary Thomas R. Moriarty,
Senior Vice President
- 6 -
SERVICE AGREEMENT
This AGREEMENT is entered into between __________________ ("Servicer") and
InterSecurities, Inc. ("Distributor") (collectively, "Parties"), effective as of
______________, 19__.
WHEREAS, Distributor is a broker-dealer registered with the Securities and
Exchange Commission ("SEC") under the Securities Exchange Act of 1934 ("1934
Act") and a member of the National Association of Securities Dealers, Inc.
("NASD");
WHEREAS, Distributor is the principal underwriter for certain open-end
investment companies registered with the SEC under the Investment Company Act of
1940, as amended ("1940 Act"), and which are set forth in Schedule A attached
hereto ("Funds"), pursuant to an Underwriting Agreement between each Fund and
Distributor;
WHEREAS, each Fund offers for sale shares of the Fund, which may include
shares issued in separate series or classes ("Shares");
WHEREAS, certain of the Funds have adopted a plan of distribution pursuant
to Rule 12b-1 under the 1940 Act ("Plan") with respect to Shares and approved
the form of this Agreement pursuant to Rule 12b-1;
WHEREAS, Servicer desires to make it possible for its customers and clients
("Investors") to purchase Shares and to act as the Investors' agent in
performing certain administrative support services in connection with purchases
and redemptions of Shares from time to time upon the order and for the account
of the Investors and to provide related services to the Investors in connection
with investments in the Funds ("Services"); and
WHEREAS, Distributor desires to retain Servicer to furnish the Services;
NOW THEREFORE, in consideration of the foregoing and the mutual premises
and covenants herein contained, which consideration is full and complete,
Distributor and Servicer mutually agree as follows:
1. APPOINTMENT. Distributor hereby appoints Servicer to render or cause to
be rendered the Services set forth in Paragraph 2 of this Agreement with respect
to Investors. Servicer accepts such appointment and, while this Agreement is in
force, shall render the Services and the obligations set forth herein for the
compensation herein provided. Servicer's appointment hereunder is non-exclusive,
and the Parties recognize and agree that, from time to time, Distributor may
enter into service agreements with other entities. Servicer shall prepare such
quarterly reports in connection with such Services as Distributor may reasonably
request.
2. SERVICES TO BE PROVIDED. The Services to be provided by Servicer
pursuant to Paragraph 1 of this Agreement may include, but are not limited to,
the following Services:
(a) maintaining account records and providing subaccounting for Investors
that become shareholders of one or more of the Funds ("Shareholders");
(b) transmitting Shareholder orders to purchase, redeem, and exchange
Shares;
(c) transfer and receipt funds for the purchase and redemption of shares,
and confirming and reconciling all such transactions;
(d) review of activity in Shareholders' Fund accounts;
- 1 -
<PAGE>
(e) assisting Investors or Shareholders to complete application forms and
designate and update dividend options, account designations and
mailing addresses;
(f) maintaining and distributing current copies of the Funds' prospectuses
and semi-annual and annual reports;
(g) transmitting proxy statements on behalf of the Funds and receiving,
tabulating and transmitting to the Funds proxies executed by
Shareholders with respect to meetings of Shareholders;
(h) advertising and otherwise informing Investors of the availability of
Shares;
(i) providing assistance and review in designing materials relating to the
Funds to distribute to Investors and developing methods of making such
materials accessible to Investors and potential Investors;
(j) responding to inquiries from Shareholders and Investors regarding
various matters relating to the Funds;
(k) providing, or assisting the Funds in obtaining, information from
Shareholders required by the Funds in connection with the
establishment of Fund accounts and the purchase of Shares;
(l) taking reasonable steps to ensure that taxpayer identification numbers
provided by Shareholders are correct and providing Distributor with
timely written notice of any failure to obtain such correct taxpayer
identification numbers; and
(m) providing such other services as may be agreed upon from time to time
and as may be permitted by applicable statutes, rules and regulations.
The Services set forth above are illustrative. Servicer is not required to
perform each Service and may at any time perform either more or fewer Services
than described above as Servicer shall deem appropriate under the circumstances.
3. EXPENSES. During the term of this Agreement, Servicer shall pay all
expenses incurred by it in connection with Services provided pursuant to this
Agreement, except out-of-pocket expenses incurred by Servicer in connection with
the transmittal of proxy materials to Shareholders and the tabulation and
submission to a Fund of proxies executed by Shareholders, for which Servicer may
obtain reimbursement from that Fund or its agent.
4. COMPENSATION. For the Services provided and the expenses assumed by
Servicer pursuant to this Agreement, Distributor shall pay Servicer the
compensation as set forth in Schedule B, attached hereto. Payment of this
compensation or the terms thereof may be modified or terminated at any time by
Distributor sending a new Schedule B to Servicer.
5. PURCHASES AND REDEMPTIONS OF SHARES.
(a) Orders received from Servicer for the purchase of Shares shall be
accepted by Distributor through Idex Investor Services, Inc.
("Transfer Agent"), only at the public offering price applicable to
each order as set forth in the then current prospectus and statement
of additional information (collectively, "Prospectus") of the
applicable Fund. The procedure relating to the handling of orders
shall be in accordance with oral or written instructions that
Distributor, Transfer Agent or the Fund shall forward to Servicer from
time to time. Payments for Shares ordered from Distributor must be
received together with Servicer's order and shall be made as specified
in the applicable Fund's Prospectus. If payment for any purchase order
is not received in accordance with the terms of the applicable Fund's
Prospectus, Distributor reserves the right, without notice, to cancel
the sale and to hold Servicer responsible for any loss sustained as a
result thereof.
- 2 -
<PAGE>
All orders are subject to acceptance or rejection, in their sole
discretion, by Distributor, the Fund, or by the Transfer Agent acting
on behalf of Distributor and the Fund, and orders shall be effective
only upon confirmation by Distributor, the Fund, or the Transfer
Agent. Servicer shall place orders for Shares in accordance with the
minimum initial and subsequent purchase requirements as set forth in
the Prospectus of the Fund. Distributor reserves the right in its
discretion and without notice to Servicer to reject any purchase
request, suspend sales, or withdraw the offering of Shares.
(b) Servicer shall in no event place orders for Shares unless it has
already received purchase orders from Investors for such Shares at the
applicable public offering price as set forth in the Prospectus of the
applicable Fund and subject to the terms thereof. Servicer shall not
offer or sell any Shares except under circumstances that will result
in compliance with all applicable federal and state securities laws,
and that in connection with sales and offers to sell Shares, Servicer
shall furnish to each person to whom any such sale or offer is made,
at or prior to the time of the offering or sale, a copy of the then
current prospectus of the applicable Fund and, if requested, the then
current statement of additional information of the Fund. Distributor
shall supply Servicer with reasonable quantities of prospectuses,
statements of additional information, supplemental sales literature,
periodic reports and proxy solicitation materials of the Funds upon
request.
CHECK SECTION 5(C)(1) OR 5(C)(2), WHICHEVER IS APPLICABLE:
___(c)(1) Servicer shall make Shares available to Investors on a fully
disclosed basis, wherein Distributor shall confirm purchases and
redemptions directly to Investors as recordholders of the Shares and
the Transfer Agent will maintain records for each such Investor.
Servicer shall assist Distributor in obtaining all information
Distributor or the Funds may reasonably request in connection with the
Investors purchase and redemption of Shares. Servicer hereby
represents and warrants that it will have full right, power and
authority to effect transactions in Shares of the Funds on behalf of
Investors for whom it effects such transactions.
or
_(c)(2) Servicer shall make Shares available to Investors on an "omnibus"
basis, wherein Servicer shall be the recordholder of the Shares and
will be responsible for subaccounting and the confirmation of
purchases and redemptions by the Investors. Each Fund, at the request
of regulatory authorities having jurisdiction over it, may request,
and in such event, Servicer shall furnish to that Fund, a list of all
Shareholders' accounts maintained by Servicer, showing each account
name, address and shareholding. Servicer shall provide Distributor or
the Fund with such other information as they may reasonably request,
including the location by state of Shares sold. All information
provided by Servicer to Distributor shall be accurate and complete.
Servicer hereby represents and warrants that it will have full right,
power and authority to effect transactions in Shares of the Funds on
behalf of Investors for whom it effects such transactions.
(d) Servicer shall offer and sell Shares only in states and jurisdictions
in which the Shares are registered and qualified for sale under, or
are exempt from the requirements of, the respective securities laws of
such states and jurisdictions. Distributor shall keep Servicer fully
informed with respect to the states and jurisdictions so qualified and
exempt; however, Distributor assumes no responsibility or obligation
as to Servicer's right to make available Shares in any state or
jurisdiction.
(e) Orders received from Servicer for the redemption of Shares shall be
executed through the Transfer Agent only at the public offering price
applicable to each order as set forth in the Prospectus of the
applicable Fund and subject to the terms thereof.
- 3 -
<PAGE>
(f) Exchanges (i.e., the investment of the proceeds from the liquidation
of the Shares of one Fund in the Shares of another Fund) shall be made
by Servicer subject to and in accordance with the Prospectus of the
applicable Fund.
6. INDEMNIFICATION. Servicer agrees to indemnify and hold harmless
Distributor, the Fund and the Transfer Agent, and their respective subsidiaries,
affiliates, officers, trustees, directors, agents and employees against any and
all direct and indirect claims, damages, liabilities, losses, expenses or costs
(including any legal or other expenses incurred in connection with investigating
or defending any such claim, damage, liability or loss) to which any of them
become subject arising from, related to, or otherwise connected with: (1) any
breach by Servicer of any provision of this Agreement; (2) any action or
omission of Distributor or the Funds in reliance upon any oral, written or
electronically transmitted communication given by or on behalf of Servicer which
Distributor or the Fund believes to be genuine; and (3) any act or failure to
act by Servicer. This Paragraph 6 shall survive the termination of this
Agreement.
7. INFORMATION PERTAINING TO THE SHARES. Servicer and its officers,
employees and agents shall not (a) make any representation, or furnish to any
person any information, relating to the Funds or the Shares that is inconsistent
in any respect with the information contained in the respective Prospectuses of
the Funds (as then amended or supplemented) or any printed material provided to
Servicer by Distributor or the Funds, or (b) cause any written materials to be
used in connection with sale of Shares or any advertisement to be published in
any newspaper, broadcast by television, radio or other means, or posted in any
public place without the prior written consent of Distributor.
8. STATUS OF SERVICER.
(a) The signing of this Agreement and the purchase of Shares pursuant
hereto is a representation by Servicer that it is duly organized and
validly existing in good standing under the laws of the jurisdiction
in which it is organized and that it is either (i) a "bank" as that
term is defined by Section 3(a)(6) of the 1934 Act, or (ii) a member
in good standing with the NASD and a broker-dealer registered under
the 1934 Act affiliated with a bank.
(b) If Servicer is a "bank," Servicer represents and warrants that it
shall act in accordance with all applicable federal and state laws,
including the rules and regulations of all applicable federal and
state bank regulatory agencies and authorities. Servicer shall give
written notice to Distributor promptly in the event that Servicer
shall cease to be a bank as defined in Section 3(a)(6) of the 1934
Act.
(c) If Servicer is a registered broker-dealer, Servicer represents and
warrants that it shall act in accordance with all applicable federal
and state laws and the Rules of Fair Practice of the NASD, including
Section 26 of Article III of such Rules. Servicer shall notify
Distributor immediately (1) in the event Servicer ceases to be a
member in good standing of the NASD or Servicer is found to have
violated any applicable federal or state law, rule or regulation
arising out of its activities as a broker-dealer or in connection with
this Agreement, or (2) upon the occurrence of any other event which
may otherwise materially affect its ability to act in accordance with
this Agreement.
(d) Servicer shall, for all purposes herein, be deemed to be an
independent contractor. Nothing in this Agreement shall be deemed or
construed to make Servicer an employee, agent, representative or
partner of Distributor or any Fund, and Servicer is not authorized to
act for a Fund or Distributor or to make any representations on behalf
of Distributor or any Fund.
9. SOLICITATION OR PROXIES. Servicer shall not solicit or cause to be
solicited, directly or indirectly, at any time, any proxies from the
Shareholders of any Fund in opposition to proxies solicited by management of the
Fund, unless a court of competent jurisdiction shall have determined that the
conduct of a majority of the Board of Trustees
- 4 -
<PAGE>
of the Fund constitutes willful misfeasance, bad faith, gross negligence or
reckless disregard of their duties. This Paragraph 9 shall survive the
termination of this Agreement.
10. ACTIVITIES OF SERVICER. The Parties recognize that Servicer may be
subject to the provisions of the Glass-Steagall Act of 1933, as amended, and
other federal and state laws and regulations governing the permissible
activities of banks and their affiliates. Servicer shall be solely responsible
for the determination that its activities and obligations pursuant to this
Agreement are permissible under such laws and regulations.
11. DURATION OF AGREEMENT. For each series or class of Shares with respect
to which a Fund has adopted a Plan, this Agreement shall continue in effect for
one year from the date of its execution and thereafter for successive periods of
one year, provided that the form of this Agreement is approved at least annually
by the Board of Trustees of that Fund, including a majority of the members of
the Board of Trustees of the Fund who are not interested persons (as defined in
the 1940 Act) of the Fund and have no direct or indirect financial interest in
the operation of the Fund's Plan or in any agreements related to the Plan (the
"Disinterested Trustees") case in person at a meeting called for voting on such
continuance.
12. TERMINATION.
(a) Notwithstanding paragraph 11 hereof, this Agreement may be terminated
with respect to a particular Fund as follows:
(i) at any time, without the payment of any penalty, by the vote of
the Board of Trustees of the Fund, by the vote of a majority of
the Disinterested Trustees of the Fund, or by the vote of a
majority of the outstanding voting securities of the Fund, or
separate series or class thereof, as defined in the 1940 Act on
not more than sixty (60) days' written notice to the Parties to
this Agreement;
(ii) automatically in the event of the termination of the Underwriting
Agreement or the Administrative Services Agreement between the
Fund and Distributor;
(iii)automatically in the event of the assignment (as defined in the
1940 Act) of this Agreement;
(iv) by either Party to the Agreement without cause by giving the
other Party at least sixty (60) days' written notice of its
intention to terminate;
(v) if Servicer is a bank, in the event of Servicer's ceasing to be a
bank as defined in Section 3(a)(6) of the 1934 Act; and
(vi) if Servicer is a registered broker-dealer, (1) in the event
Servicer ceases to be a member in good standing of the NASD or
Servicer is found to have violated any applicable federal or
state law, rule or regulation arising out of its activities as a
broker-dealer or in connection with this Agreement, or (2) upon
the occurrence of any other event which may otherwise materially
affect its ability to act in accordance with this Agreement.
(b) The termination of this Agreement with respect to any one Fund will
not cause the Agreement's termination with respect to any other Fund.
13. NOTICES. Any notice under this Agreement shall be in writing and shall
be addressed and delivered, or mailed, postage prepaid to the other Party's
principal place of business, attention: Legal Department, or to such other place
as shall have been previously specified by written notice given to the other
Party.
- 5 -
<PAGE>
14. AMENDMENTS TO AGREEMENT. This Agreement may be amended by Distributor
from time to time by the following procedure. Distributor shall provide notice
of the amendment to Servicer in the manner set forth in Paragraph 13. If
Servicer does not object to the amendment within thirty (30) days after its
receipt, the amendment shall become part of this Agreement. Servicer's objection
must be in writing and be received by Distributor within such thirty (30) days
of Servicer's receipt of the amendment. Any order to purchase Shares placed by
Servicer after notice of any amendment to this Agreement has been sent to
Servicer shall constitute Servicer's agreement to such amendment.
15. MISCELLANEOUS. This Agreement constitutes the entire agreement between
the Parties and no conditions or warranties shall be implied unless expressly
set forth herein. This Agreement and all of the rights and obligations of the
Parties hereunder shall be governed by and construed under the laws of the State
of Florida. To the extend that the applicable laws of the State of Florida
conflict with the applicable provisions of the federal securities laws, the
latter shall prevail. The captions in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions hereof or otherwise affect their construction or effect.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
by their officers designated below.
-----------------------------
Servicer
(Please Print or Type)
-----------------------------
Address
-----------------------------
City State Zip Code
By: _________________________
Signature
Name: _______________________
Title: ________________________
InterSecurities, Inc.
201 Highland Avenue
Largo, Florida 34640
By: _________________________
Signature
Name: _______________________
Title: ________________________
- 6 -
<PAGE>
AMENDMENT TO
SCHEDULE A FOR SERVICE AGREEMENT
Distributor is the principal underwriter for each of the following registered
investment companies:
IDEX Series Fund
IDEX Growth Portfolio IDEX Balanced Portfolio
Class A Shares Class A Shares
Class B Shares Class B Shares
Class C Shares Class C Shares
IDEX Global Portfolio IDEX Capital Appreciation Portfolio
Class A Shares Class A Shares
Class B Shares Class B Shares
Class C Shares Class C Shares
IDEX Flexible Income Portfolio IDEX Aggressive Growth Portfolio
Class A Shares Class A Shares
Class B Shares Class B Shares
Class C Shares Class C Shares
IDEX Tax-Exempt Portfolio IDEX Strategic Total Return Portfolio
Class A Shares Class A Shares
Class B Shares Class B Shares
Class C Shares Class C Shares
IDEX Income Plus Portfolio IDEX Tactical Asset Allocation Portfolio
Class A Shares Class A Shares
Class B Shares Class B Shares
Class C Shares Class C Shares
IDEX C.A.S.E. Portfolio IDEX Value Equity Portfolio
Class A Shares Class A Shares
Class B Shares Class B Shares
Class C Shares Class C Shares
IDEX International Equity Portfolio
Class A Shares
Class B Shares
Class C Shares
Dated February 1, 1997
InterSecurities, Inc.
Principal Underwriter for
IDEX Series Fund
/S/
By: _________________________
G. John Hurley, President
<PAGE>
AMENDMENT TO
SCHEDULE B FOR SERVICE AGREEMENT
A. With respect to each purchase of Shares of a Fund by or on behalf of an
Investor pursuant to an order placed by Servicer, Distributor shall pay
Servicer an amount equal to the dealer allowance, if any, specified in the
then current prospectus of that Fund that would be applicable to that
purchase of Shares if Servicer were acting as a dealer in that transaction.
The amounts due Servicer shall be paid quarterly; however, if any Shares
purchased by or through Servicer are redeemed or repurchased within seven
(7) days after Servicer's order to purchase those Shares, Servicer shall
refund to Distributor any fee paid to Servicer as a result of that order.
B. For the personal services and/or maintenance of shareholder accounts
described in Paragraph 2 of the Service Agreement, Distributor shall pay to
Servicer a fee, computed on an annual basis and paid quarterly, in an
amount equal to the applicable percentage of the average aggregate net
asset value of the Shares of the Fund, as set forth below, held by or on
behalf of Investors. For the month and year in which this Schedule B
becomes effective or the Agreement terminates, there shall be an
appropriate proration of the fee payable hereunder made on the basis of the
number of days that the Schedule or Agreement, as applicable, is in effect.
IDEX Series Fund (consisting of the following Portfolios):
IDEX Growth Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
Class T Shares N/A
IDEX Global Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
IDEX Flexible Income Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
IDEX Tax-Exempt Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.60%*
IDEX Income Plus Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
IDEX Balanced Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
IDEX Capital Appreciation Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
IDEX Aggressive Growth Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
IDEX Strategic Total Return Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
<PAGE>
IDEX Tactical Asset Allocation Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
IDEX C.A.S.E. Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
IDEX Value Equity Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
IDEX International Equity Portfolio
Class A Shares 0.25%
Class B Shares 0.25%
Class C Shares 0.90%*
- ---------------------------
* Consists of an annual distribution fee of up to 0.75%, and an annual
service fee of up to 0.25%; however the total fee payable may not on an
annualized basis exceed 0.90% of the average daily net assets of Class C
shares of each Portfolio (0.60% for the Tax-Exempt Portfolio). The
Distributor currently reallows the total distribution and service fees to
Servicer for the sale of Class C shares.
Dated February 1, 1997
InterSecurities, Inc.
Principal Underwriter for
IDEX Series Fund
/S/
By:______________________________
G. John Hurley, President
CUSTODY AGREEMENT
THIS AGREEMENT made the 3rd day of April, 1986, by and between
INVESTORS FIDUCIARY TRUST COMPANY, a trust company chartered under the laws of
the state of Missouri, having its trust office located at 21 West 10th Street,
16th Floor, Kansas City, Missouri 64105 ("Custodian"), and IDEX II a
Massachusetts business trust having its principal office and place of business
at 600 Cleveland Street, Suite 800, Clearwater, Florida 33515 ("Fund").
WITNESSETH:
WHEREAS, Fund desires to appoint Investors Fiduciary Trust Company as
Custodian of the securities and monies of Fund's investment portfolio; and
WHEREAS, Investors Fiduciary Trust Company is willing to accept such
appointment;
NOW THEREFORE, for and in consideration of the mutual promises contained
herein, the parties hereto, intending to be legally bound, mutually covenant and
agree as follows:
1. APPOINTMENT OF CUSTODIAN. Fund hereby constitutes and appoints Custodian as
custodian of the Fund which is to include:
A. Appointment as custodian of the securities and monies at any time
owned by the Fund; and
B. Appointment as agent to perform certain accounting and recordkeeping
functions required of a duly registered investment company in
compliance with applicable provisions of federal, state and local
laws, rules and regulations including, as may be required:
1. Provide information necessary for Fund to file required financial
reports; maintaining and preserving required books, accounts and
records as the basis for such reports; and performing certain
daily functions in connection with such accounts and records.
2. Calculating daily net asset value of the Fund, and
3. Acting as liaison with independent auditors.
2. DELIVERY OF CORPORATE DOCUMENTS. Fund has delivered or will deliver to
Custodian prior to the effective date of this Agreement, copies of the
following documents and all amendments or supplements thereto, properly
certified or authenticated:
A. Resolutions of the Board of Trustees of Fund appointing Custodian as
custodian hereunder and approving the form of this Agreement; and
B. Resolutions of the Board of Trustees of Fund designating certain
persons to give instructions on behalf of Fund to Custodian and
authorizing Custodian to rely upon written instructions over their
signatures.
3. DUTIES AND RESPONSIBILITIES OF CUSTODIAN.
1
<PAGE>
A. Delivery of Assets
Fund will deliver or cause to be delivered to Custodian on the
effective date of this Agreement, or as soon thereafter as
practicable, and from time to time thereafter, all portfolio
securities acquired by it and monies then owned by it except as
permitted by the Investment Company Act of 1940 or from time to time
coming into its possession during the time this Agreement shall
continue in effect. Custodian shall have no responsibility or
liability whatsoever for or on account of securities or monies not so
delivered. All securities so delivered to Custodian (other than bearer
securities) shall be registered in the name of Fund or its nominee, or
of a nominee of Custodian, or shall be properly endorsed and in form
for transfer satisfactory to Custodian.
B. Delivery of Accounts and Records
Fund shall turn over to Custodian all of the Fund's relevant accounts
and records previously maintained by it. Custodian shall be entitled
to rely conclusively on the completeness and correctness of the
accounts and records turned over to it by Fund, and Fund shall
indemnify and hold Custodian harmless of and from any and all
expenses, damages and losses whatsoever arising out of or in
connection with any error, omission, inaccuracy or other deficiency of
such accounts and records or in the failure of Fund to provide any
portion of such or to provide any information needed by the Custodian
knowledgeably to perform its function hereunder.
C. Delivery of Assets to Third Parties
Custodian will receive delivery and keep safely the assets of Fund
delivered to it from time to time segregated in a separate account.
Custodian will not deliver, assign, pledge or hypothecate any such
assets to any person except as permitted by the provisions of this
Agreement or any agreement executed by it according to the terms of
section 3.S. of this Agreement. The Custodian is responsible for the
securities and monies of Fund only until they have been transmitted to
and received by other persons as permitted under the terms of this
Agreement, except for securities and monies transmitted to a
sub-custodian as provided for by section 3.S., f or which Custodian
remains responsible. Custodian shall be responsible only for the
monies and securities of Fund held by it or its nominees,
sub-custodians or eligible foreign custodians under this Agreement.
Custodian may participate directly or indirectly through a
sub-custodian in the Depository Trust Company or Treasury/Federal
Reserve Book Entry System (as such entity is defined at 17 CFR Section
270.17f-4(b).
D. Registration of Securities
Custodian will hold stocks and other registerable portfolio securities
of Fund registered in the name of Fund or in the name of any nominee
of Custodian for whose fidelity and liability Custodian will be fully
responsible, or in street certificate form, so-called, with or without
any indication of fiduciary capacity. Unless otherwise instructed,
Custodian will register all such portfolio securities in the name of
its authorized nominee. All securities, and the ownership thereof by
Fund, which are held by Custodian hereunder, however, shall at all
times be identifiable on the records of the Custodian or its
sub-custodian. The Fund agrees to hold Custodian and its -nominee
harmless for any liability as a record holder of securities held in
custody.
E. Exchange of Securities
Upon receipt of instructions as defined herein in Section 4.A,
Custodian will exchange, or cause to be exchanged, portfolio
securities held by it for the account of Fund for other securities or
cash
2
<PAGE>
issued or paid in connection with any reorganization,
recapitalization, merger, consolidation, split-up of shares, change of
par value, conversion or otherwise, and will deposit any such
securities in accordance with the terms of any reorganization or
protective plan. Without instructions, Custodian is authorized to
exchange securities held by it in temporary form for securities in
definitive form, to effect an exchange of shares when the par value of
the stock is changed, and, upon receiving payment therefor, to
surrender bonds or other securities held by it at maturity or when
advised of earlier call for redemption, except that Custodian shall
receive instructions prior to surrendering any convertible security.
F. Purchases of Investments of the Fund
Fund will, on each business day on which a purchase of securities
shall be made by it, deliver to Custodian instructions which shall
specify with respect to each such purchase:
1. The name of the issuer and description of the security;
2. The number of shares or the principal amount purchased, and
accrued interest, if any;
3. The trade date;
4. The settlement date;
5. The purchase price per unit and the brokerage commission, taxes
and other expenses payable in connection with the purchase;
6. The total amount payable upon such purchase; and
7. The name of the person from whom or the broker or dealer through
whom the purchase was made.
In accordance with such instructions, Custodian will pay for out of
monies held for the account of Fund, but only insofar as monies are
available therein for such purpose, and receive the portfolio
securities so purchased by or for the account of Fund. Such payment
will be made only upon receipt by Custodian of the securities so
purchased in form for transfer satisfactory to Custodian.
G. Sales and Deliveries of Investments of the Fund - Other than Options
and Futures
Fund will, on each business day on which a sale of investment
securities of Fund has been made, deliver to Custodian instructions
specifying with respect to each such sale:
1. The name of the issuer and description of the securities;
2. The number of shares or principal amount sold, and accrued
interest, if any;
3. The date on which the securities sold were purchased or other
information identifying the securities sold and to be delivered;
4. The trade date;
5. The settlement date;
3
<PAGE>
6. The sale price per unit and the brokerage commission, taxes or
other expenses payable in connection with such sale;
7. The total amount to be received by Fund upon such sale; and
8. The name of the broker or dealer through whom or person to whom
the sale was made.
In accordance with such instructions, Custodian will deliver or cause
to be delivered the securities thus designated as sold for the account
of Fund to the broker or other person specified in the instructions
relating to such sale, such delivery to be made only upon receipt of
payment therefor in such form as is satisfactory to Custodian, with
the understanding that Custodian may deliver or cause to be delivered
securities for payment in accordance with the customs prevailing among
dealers in securities.
H. Purchases or Sales of Security Options, Options on Indices and
Security Index Futures Contracts Fund will, on each business day on
which a purchase or sale of the following options and/or futures shall
be made by it, deliver to Custodian instructions which shall specify
with respect to each such purchase or sale:
1. Security Options
a. The underlying security;
b. The price at which purchased or sold;
c. The expiration date;
d. The number of contracts;
e. The exercise price;
f. Whether the transaction is and opening, exercising, expiring
or closing transaction;
g. Whether the transaction involves a put or call;
h. Whether the option is written or purchased;
i. Market on which option traded;
j. Name and address of the broker or dealer through whom the
sale or purchase was made.
2. Options on Indices
a. The index;
b. The price at which purchased or sold;
c. The exercise price;
d. The premium;
4
<PAGE>
e. The multiple;
f. The expiration date;
g. Whether the transaction is an opening, exercising, expiring
or closing transaction;
h. Whether the transaction involves a put or call;
i. Whether the option is written or purchased;
j. The name and address of the broker or dealer through whom
the sale or purchase was made, or other applicable
settlement instructions.
3. Security Index Future Contracts
a. The last trading date specified in the contract and, when
available, the closing level, thereof;
b. The index level on the date the contract is entered into;
c. The multiple;
d. Any margin requirements; and
e. The need for a segregated margin account (in addition to
instructions, and if not already in the possession of
Custodian, Fund shall deliver a substantially complete and
executed custodial safekeeping account and procedural
agreement which shall be incorporated by reference into this
Custody Agreement).
f. The name and address of the futures commission merchant
through whom the sale or purchase was made, or other
applicable settlement instructions.
4. Options on Index Future Contracts
a. The underlying index future contract;
b. The premium;
c. The expiration date;
d. The number of options;
e. The exercise price;
f. Whether the transaction involves an opening, exercising,
expiring or closing transaction;
g. Whether the transaction involves a put or call;
h. Whether the option is written or purchased
i. The market on which the option is traded.
5
<PAGE>
I. Securities Pledged or Loaned
If specifically allowed for in the prospectus of Fund:
1. Upon receipt of instructions, Custodian will release or cause to
be released securities held in custody to the pledgee designated
in such instructions by way of pledge or hypothecation to secure
any loan incurred by Fund, provided, however, that the securities
shall be released only upon payment to Custodian of the monies
borrowed, except that in cases where additional collateral is
required to secure a borrowing already made, further securities
may be released or caused to be released - for that purpose upon
receipt of instructions. Upon receipt of instructions, Custodian
will pay, but only from funds available for such purpose, any
such loan upon redelivery to it of the securities pledged or
hypothecated therefor and upon surrender of the note or notes
evidencing such loan.
2. Upon receipt of instructions, Custodian will release securities
held in custody to the borrower designated in such instructions;
provided, however, that if the borrower is a bank or securities
broker-dealer, the securities will be released only upon deposit
with Custodian of full cash collateral as specified in such
instructions, and that Fund will retain the right to any
dividends, interest or distribution on such loaned securities.
Upon receipt of instructions and the loaned securities, Custodian
will release the cash collateral to the borrower.
J. Routine Matters
Custodian will, in general, attend to all routine and mechanical
matters in connection with the sale, exchange, substitution, purchase,
transfer, or other dealings with securities or other property of Fund
except as may be otherwise provided in this Agreement or directed from
time to time by the Board of Trustees of Fund.
K. Deposit Account
Custodian will open and maintain a special purpose deposit account or
accounts in the name of Custodian ("Account"), subject only to draft
or order by Custodian upon receipt of instructions. All monies
received by Custodian from or for the account of Fund shall be
deposited in said Account, barring events not in the control of the
Custodian such as strikes, lockouts or labor disputes, riots, war or
equipment or transmission failure or damage, fire, flood, earthquake
or other natural disaster, action or inaction of governmental
authority or other causes beyond its control, at 9:00 a.m., Kansas
City time, on the second business day after deposit of any check into
Fund's Account.
Custodian may open and maintain an Account in such other banks or
trust companies as may be designated by it or by properly authorized
resolution of the Board of Trustees of Fund, such Account, however, to
be in the name of custodian and subject only to its draft or order.
L. Income and other Payments to Fund
Custodian will:
1. Collect, claim and receive and deposit for the Account of Fund
all income and other payments which become due and payable on or
after the effective date of this Agreement with respect to the
securities deposited under this Agreement, and credit the account
of Fund with such income on the payable date;
6
<PAGE>
2. Execute ownership and other certificates and affidavits for all
federal, state and local tax purposes in connection with the
collection of bond and note coupons; and
3. Take such other action as may be necessary or proper in
connection with:
a. the collection, receipt and deposit of such income and other
payments, including but not limited to the presentation for
payment of:
1. all coupons and other income items requiring purpose;
and
2. all other securities which may mature or be called,
redeemed, retired or otherwise become payable and
regarding which the Custodian has actual knowledge, or
notice of which is contained in publications of the
type to which it normally subscribes for such purpose;
and
b. the endorsement for collection, in the name of Fund, of all
checks, drafts or other negotiable instruments. Custodian,
however, will not be required to institute suit or take
other extraordinary action to enforce collection except upon
receipt of instructions and upon being indemnified to its
satisfaction against the costs and expenses of such suit or
other actions. Custodian will receive, claim and collect all
stock dividends, rights and other similar items and will
deal with the same pursuant to instructions. Unless prior
instructions have been received to the contrary, Custodian
will, without further instructions, sell any rights held for
the account of Fund on the last trade date prior to the date
of expiration of such rights.
M. Payment of Dividends and other Distributions
On the declaration of any dividend or other distribution on the shares
of Beneficial Interest of Fund ("Fund Shares") by the Board of
Trustees of Fund, Fund shall deliver to Custodian instructions with
respect thereto, including a copy of the Resolution of said Board of
Trustees certified by the Secretary or an Assistant Secretary of Fund
wherein there shall be set forth the record date as of which
shareholders entitled to receive such dividend or other distribution
shall be determined, the date of payment of such dividend or
distribution, and the amount payable per share on such dividend or
distribution.
Except if the ex-dividend date and the reinvestment date of any
dividend are the same, in which case funds shall remain in the Custody
Account, on the date specified in such Resolution f or the payment of
such dividend or other distribution, Custodian will pay out of the
monies held for the account of Fund, insofar as the same shall be
available for such purposes, and credit to the account of the Dividend
Disbursing Agent for Fund, such amount as may be necessary to pay the
amount per share payable in cash on Fund Shares issued and outstanding
on the record date established by such Resolution.
N. Shares of Fund Purchased by Fund
Whenever any Fund Shares are repurchased or redeemed by Fund, Fund or
its agent shall advise Custodian of the aggregate dollar amount to be
paid for such shares and shall confirm such advice in writing. Upon
receipt of such advice, Custodian shall charge such aggregate dollar
amount to the Account of Fund and either deposit the same in the
account maintained for the purpose of paying for the repurchase or
redemption of Fund Shares or deliver the same in accordance with such
advice.
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<PAGE>
Custodian shall not have any duty or responsibility to determine that
Fund Shares repurchased or redeemed by Fund have been removed from the
proper shareholder account or accounts or that the proper number of
such shares have been cancelled and removed from the shareholder
records.
O. Shares of Fund Purchased from Fund
Whenever Fund Shares are purchased from Fund, Fund will deposit or
cause to be deposited with Custodian the amount received for such
shares.
Custodian shall not have any duty or responsibility to determine that
Fund Shares purchased from Fund have been added to the proper
shareholder account or accounts or that the proper number of such
shares have been added to the shareholder records.
P. Proxies and Notices
Custodian will promptly deliver or mail or have delivered or mailed to
Fund all proxies properly signed, all notices of meetings, all proxy
statements and other notices, requests or announcements affecting or
relating to securities held by Custodian for Fund and will, upon
receipt of instructions, execute and deliver or cause its nominee to
execute and deliver or mail or have delivered or mailed such proxies
or other authorizations as may be required. Except as provided by this
Agreement or pursuant to instructions hereafter received by Custodian,
neither it nor its nominee will exercise any power inherent in any
such securities, including any power to vote the same, or execute any
proxy, power of attorney, or other similar instrument voting any of
such securities, or give any consent, approval or waiver with respect
thereto, or take any other similar action.
Q. Disbursements
Custodian will pay or cause to be paid insofar as funds are available
for the purpose, bills, statements and other obligations of Fund
(including but not limited to obligations in connection with the
conversion, exchange or surrender of securities owned by Fund,
interest charges, dividend disbursements, taxes, management fees,
custodian fees, legal fees, auditors' fees, transfer agents' fees,
brokerage commissions, compensation to personnel, and other operating
expenses of Fund) pursuant to instructions of Fund setting forth the
name of the person to whom payment is to be made, the amount of the
payment, and the purpose of the payment.
R. Daily Statement of Accounts
Custodian will, within a reasonable time, render to Fund as of the
close of business on each day, a detailed statement of the amounts
received or paid and of securities received or delivered for the
account of Fund during said day. Custodian will, from time to time,
upon request by Fund, render a detailed statement of the securities
and monies held for Fund under this Agreement, and Custodian will
maintain such books and records as are necessary to enable it to do so
and will permit such persons as are authorized by Fund; and if
demanded, federal and state regulatory agencies to examine the
securities, books and records. Upon the instructions of Fund or as
demanded by federal or state regulatory agencies, Custodian will
instruct sub-custodian to permit such persons as are authorized by
Fund and if demanded, federal and state regulatory agencies to examine
the books, records and securities held by sub-custodian which relate
to Fund.
8
<PAGE>
S. Appointment of Sub-Custodian
1. Notwithstanding any other provisions of this Agreement, all or
any of the monies or securities of Fund may be held in
Custodian's own custody or in the custody of one or more other
banks or trust companies acting as sub-custodians as may be
selected by Custodian. Any such sub-custodian must have the
qualifications required for custodian under the Investment
Company Act of 1940, as amended. The sub-custodian may
participate directly or indirectly in the Depository Trust
Company or Treasury/Federal Reserve Book Entry System (as such
entity is defined at 17 CFR Sec. 270.17f-4(b)). Neither Custodian
nor subcustodian will be entitled to reimbursement by Fund for
any fees or expenses of any sub-custodian. The appointment of a
sub-custodian will not relieve Custodian of any of its
obligations hereunder.
2. Notwithstanding any other provisions of this Agreement, Fund's
foreign securities (as defined in Rule 17f-5(c)(1) under the
Investment Company Act of 1940) and Fund's cash or cash
equivalents, in amounts reasonably necessary to effect Fund's
foreign securities transactions, may be held in the custody of
one or more banks or trust companies acting as sub-custodians,
according to Section 3.S.1; and thereafter, pursuant to a written
contract or contracts as approved by Fund's Board of Trustees,
may be transferred to an account maintained by such sub-custodian
with an eligible foreign custodian, as defined in Rule
17f-5(c)(2), provided that any such arrangement involving a
foreign custodian shall be in accordance with the provisions of
Rule 17f-5 under the Investment Company Act of 1940 as that Rule
may be amended from time to time.
T. Accounts and Records
Custodian will prepare and maintain complete, accurate and current all
accounts and records required to be maintained by Fund under the
Internal Revenue Code of 1954 ("Code") as amended and under the
General Rules and Regulations under the Investment Company Act of 1940
("Rules") as amended, and as agreed upon between the parties and will
preserve said records in the manner and for the periods prescribed in
said Code and Rules, or for such longer period as is agreed upon by
the parties.
Custodian relies upon Fund to furnish, in writing, accurate and timely
information to complete Fund's records and perform daily calculation
of the Fund's net asset value, as provided in Section 3.W. below.
Custodian shall incur no liability and Fund shall indemnify and hold
harmless Custodian from and against any liability arising from any
failure of Fund to fumish such information in a timely and accurate
manner, even if Fund subsequently provides accurate but untimely
information. It shall be the responsibility of Fund to fumish
Custodian with the declaration, record and payment dates and amounts
of any dividends or income and any other special actions required
concerning each of its securities when such information is not readily
available from generally accepted securities industry services or
publications.
U. Accounts and Records Property of Fund
Custodian acknowledges that all of the accounts and records maintained
by Custodian pursuant to this Agreement are the property of Fund, and
will be made available to Fund for inspection or reproduction within a
reasonable period of time, upon demand. Custodian will assist Fund's
independent auditors, or upon approval of Fund, or upon demand, any
regulatory body, in any requested review of Fund's accounts and
records but shall be reimbursed for all expenses and
9
<PAGE>
employee time invested in any such review outside of routine and
normal periodic reviews. Upon receipt from Fund of the necessary
information, Custodian will supply necessary data for Fund's
completion of any necessary tax returns, questionnaires, periodic
reports to Shareholders and such other reports and information
requests as Fund and Custodian shall agree upon from time to time.
V. Adoption of Procedures
Custodian and Fund may from time to time adopt procedures as they
agree upon, and Custodian may conclusively assume that no procedure
approved by Fund, or directed by Fund, conflicts with or violates any
requirements of its prospectus, Deed of Trust, Bylaws, or any rule or
regulation of any regulatory body or governmental agency. Fund will be
responsible to notify Custodian of any changes in state statutes,
regulations, rules or policies which might necessitate changes in
Custodian's responsibilities or procedures.
W. Calculation of Net Asset Value
Custodian will calculate Fund's net asset value, in accordance with
Fund's prospectus, once daily. Custodian will prepare and maintain a
daily evaluation of securities for which market quotations are
available by the use of outside services normally used and contracted
for this purpose; all other securities will be evaluated in accordance
with Fund's instructions. Custodian will have no responsibility for
the accuracy of the prices quoted by these outside services or for the
information supplied by Fund or upon instructions.
4. INSTRUCTIONS.
A. The term "instructions", as used herein, means written or oral
instructions to Custodian from a designated representative of Fund.
Certified copies of resolutions of the Board of Trustees of Fund
naming one or more designated representatives to give instructions in
the name and on behalf of Fund, may be received and accepted from time
to time by Custodian as conclusive evidence of the authority of any
designated representative to act for Fund and may be considered to be
in full force and effect (and Custodian will be fully protected in
acting in reliance thereon) until receipt by Custodian of notice to
the contrary. Unless the resolution delegating authority to any person
to give instructions specifically requires that the approval of anyone
else will first have been obtained, Custodian will be under no
obligation to inquire into the right of the person giving such
instructions to do so. Notwithstanding any of the foregoing provisions
of this Section 4. no authorizations or instructions received by
Custodian from Fund, will be deemed to authorize or permit any
director, officer, employee, or agent of Fund to withdraw any of the
securities or similar investments of Fund upon the mere receipt of
such authorization or instructions from such director, officer,
employee or agent.
Notwithstanding any other provision of this Agreement, Custodian, upon
receipt (and acknowledgement if required at the discretion of
Custodian) of the instructions of a designated representative of Fund
will undertake to deliver for Fund's account monies, (provided such
monies are on hand or available) in connection with Fund's
transactions and to wire transfer such monies to such broker, dealer,
subcustodian, bank or other agent specified in such instructions by a
designated representative of Fund.
B. No later than the next business day immediately following each oral
instruction, Fund will send Custodian written confirmation of such
oral instruction. At Custodian's sole discretion, Custodian may record
on tape, or otherwise, any oral instruction whether given in person or
10
<PAGE>
via telephone, each such recording identifying the parties, the date
and the time of the beginning and ending of such oral instruction.
5. LIMITATION OF LIABILITY OF CUSTODIAN.
A. Custodian shall hold harmless and indemnify Fund from and against any
loss or liability arising out of Custodian's failure to comply with
the terms of this Agreement or arising out of Custodian's negligence,
willful misconduct, or bad faith. Custodian may request and obtain the
advice and opinion of counsel for Fund, or of its own counsel with
respect to questions or matters of law, and it shall be without
liability to Fund for any action taken or omitted by it in good faith,
in conformity with such advice or opinion.
B. Custodian may rely upon statements of Fund's independent certified
public accountants and any representative of Fund authorized to give
instructions, and Custodian shall not be liable for any actions taken,
in good faith, upon such statements.
C. If Fund requires Custodian in any capacity to take, with respect to
any securities, any action which involves the payment of money by it,
or which in Custodian's opinion might make it or its nominee liable
for payment of monies or in any other way, Custodian, upon notice to
Fund given prior to such actions, shall be and be kept indemnified by
Fund in an amount and form satisfactory to Custodian against any
liability on account of such action.
D. Custodian shall be entitled to receive, and Fund agrees to pay to
Custodian, on demand, reimbursement for such cash disbursements, costs
and expenses as may be agreed upon from time to time by Custodian and
Fund.
E. Custodian shall be protected in acting as custodian hereunder upon any
instructions, advice, notice, request, consent, certificate or other
instrument or paper reasonably appearing to it to be genuine and to
have been properly executed and shall, unless otherwise specifically
provided herein, be entitled to receive as conclusive proof of any
fact or matter required to be ascertained from Fund hereunder, a
certificate signed by the Fund's President, or other officer
specifically authorized for such purpose.
F. Without limiting the generality of the foregoing, Custodian shall be
under no duty or obligation to inquire into, and shall not be liable
for:
1. The legality of the purchase of any security by or for Fund or
evidence of ownership required by Fund to be received by
Custodian, or the propriety of the decision to purchase or amount
paid therefor;
2. The legality of the sale of any securities by or for Fund, or the
propriety of the amount for which the same are sold;
3. The legality of the issue or sale of any beneficial interest of
Fund, or the sufficiency of the amount to be received therefor;
4. The legality of the repurchase or redemption of any shares of
beneficial interest of, or the propriety of the amount to be paid
therefor; or
5. The legality of the declaration of any dividend by Fund, or the
legality of the issue of any shares of beneficial interest of
Fund in payment of any stock dividend.
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<PAGE>
G. Custodian shall not be liable for, or considered to be Custodian of,
any money represented by any check, draft, wire transfer, clearing
house funds, uncollected funds, or instrument for the payment of money
received by it on behalf of Fund, until Custodian actually receives
such money, provided only that it shall advise Fund promptly if it
fails to receive any such money in the ordinary course of business,
and use its best efforts and cooperate with Fund toward the end that
such money shall be received.
H. Except sub-custodians or eligible foreign custodians appointed under
section 3.S., Custodian shall not be responsible for loss occasioned
by the acts, neglects, defaults or insolvency of any broker, bank,
trust company, or any other person with whom Custodian may deal in the
absence of negligence, misconduct, or bad faith on the part of
Custodian.
1. Notwithstanding anything herein to the contrary, Custodian may
provide Fund for its approval, agreements with banks or trust
companies which will act as sub-custodians for Fund pursuant to
Section 3.S of this Agreement.
6. COMPENSATION. Fund will pay to Custodian such compensation as is stated in
the Fee Schedule attached hereto as Exhibit A which may be changed f rom
time to time as agreed to in writing by Custodian and Fund. Custodian may
charge such compensation against monies held by it for the account of Fund.
Custodian will also be entitled, notwithstanding the provisions of Sections
5.C. or 5.D. hereof, to charge against any monies held by it for the
account of Fund the amount of any fee for which it shall be entitled to
reimbursement under the provisions of this Agreement. Custodian will not be
entitled to reimbursement by Fund for any loss or expenses of any
sub-custodian or eligible foreign custodian.
7. TERMINATION. The term of this Agreement shall be one year. Either party to
this Agreement may terminate the same by notice in writing, delivered or
mailed, postage prepaid, to the other party hereto and received not less
than ninety (90) days prior to the date upon which such termination will
take effect. Upon termination of this Agreement, Fund will pay to Custodian
such compensation for its reimbursable disbursements, costs and expenses
paid or incurred to such date and Fund will use its best efforts to obtain
a successor custodian. Unless the holders of a majority of the outstanding
shares of beneficial interest vote to have the securities, funds and other
properties held under this Agreement delivered and paid over to some other
person, firm or corporation specified in the vote, having not less the Two
Million Dollars ($2,000,000) aggregate capital, surplus and undivided
profits, as shown by its last published report, and meeting such other
qualifications for custodian as set forth in the Bylaws of Fund, the Board
of Trustees of Fund will, forthwith upon giving or receiving notice of
termination of this Agreement, appoint as successor custodian a bank or
trust company having such qualifications. Custodian will, upon termination
of this Agreement, deliver to the successor custodian so specified or
appointed, at Custodian's office, all securities then held by Custodian
hereunder, duly endorsed and in form for transfer, all funds and other
properties of Fund deposited with or held by Custodian hereunder, or will
co-operate in effecting changes in book-entries at the Depository Trust
Company or in the Treasury/Federal Reserve Book-Entry System pursuant to 31
CFR Sec. 306.118. In the event no such vote has been adopted by the holder
of shares of beneficial interest of Fund and no written order designating a
successor custodian has been delivered to Custodian on or before the date
when such termination becomes effective, then Custodian will deliver the
securities, funds and properties of Fund to a bank or trust company at the
selection of Custodian and meeting the qualifications for custodian, if
any, set forth in the Bylaws of Fund and having not less that Two Million
Dollars ($2,000,000) aggregate capital, surplus and undivided profits, as
shown by its last published report. Upon either such delivery to a
successor custodian, Custodian will have no further duties under this
Agreement. Thereafter such bank or trust company will be the successor
custodian under this Agreement and
12
<PAGE>
will be entitled to reasonable compensation for its services. In the event
that no such successor custodian can be found, Fund will submit to its
shareholders, before permitting delivery of the cash and securities owned
by Fund to anyone other than a successor custodian, the question of whether
Fund will be liquidated or function without a custodian. Notwithstanding
the foregoing requirement as to delivery upon termination of this
Agreement, Custodian may make any other delivery of the securities, funds
and property of Fund which is permitted by the Investment Company Act of
1940, Fund's Deed of Trust and Bylaws then in effect or apply to a court of
competent jurisdiction for the appointment of a successor custodian.
In addition to the obligations of Custodian under this Agreement, upon
termination of this Agreement all records maintained by Custodian in
machine readable form relating to the services to be performed by Custodian
under this Agreement shall be surrendered to Fund or its agent in machine
readable form, and Custodian shall use its best efforts to assist in the
conversion of such records to the recordkeeping system of the successor to
Custodian.
8. NOTICES. Notices, requests, instructions and other writings received by
Fund at Attn: Mr. Peter D. Jones, Executive Vice President, 600 Cleveland
Street, Suite 800, Clearwater, Florida 33515 or at such other address as
Fund may have designated to Custodian in writing, will be deemed to have
been properly given to Fund hereunder; and notices, requests, instructions
and other writings received by Custodian at its offices at 21 West 10th
Street, 16th Floor, Kansas City, Missouri 64105, or to such other address
as it may have designated to Fund in writing, will be deemed to have been
properly given to Custodian hereunder.
9. MISCELLANEOUS.
A. This Agreement is executed and delivered in the State of Missouri and
shall be governed by the laws of said state.
B. All the terms and provisions of this Agreement shall be binding upon,
inure to the benefit of, and be enforceable by the respective
successor and assigns of the parties hereto.
C. No provisions of the Agreement may be amended or modified, in any
manner except by a written agreement properly authorized and executed
by both parties hereto.
D. The captions in this Agreement are included for convenience of
reference only, and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
E. This Agreement shall become effective at the close of business on the
3rd day of April, 1986.
F. This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original but all of
which together will constitute one and the same instrument.
G. If any part, term or provision of this Agreement is by the courts held
to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not be
affected, and the rights and obligations of the parties shall be
construed and enforced as if the Agreement did not contain the
particular part, term or provision held to be illegal or invalid.
H. This Agreement may not be assigned by either party without prior
written consent of the other party.
13
<PAGE>
I. If any provision of the Agreement, either in its present form or as
amended from time to time, limits, qualifies or conflicts with the
Investment Company Act of 1940 and the rules and regulations
promulgated thereunder, such statutes, rules and regulations shall be
deemed to control and supersede such provision without nullifying or
terminating the remainder of the provisions of this Agreement.
J. A copy of the Declaration of Trust is on file with the Secretary of
the Commonwealth. This Agreement has been executed on behalf of the
Fund by the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this Agreement shall not be
binding upon the assets and property of the Fund and shall not be
binding upon any Trustee, officer or shareholder of the Fund
individually.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective authorized corporate officers, and their respective
corporate seals to be affixed.
INVESTORS FIDUCIARY TRUST COMPANY
By: /S/ Richard A. Winegar
Richard A. Winegar, Vice President
(Corporate Seal)
ATTEST:
/S/ Cheryl J. Naegler
Cheryl J. Naegler, Assistant Secretary
IDEX II
By: /S/ Robert J. Druten
Robert J. Druten
President
(Corporate Seal)
ATTEST:
/S/ Ellen T. Stoutamire
Ellen T. Stoutamire
Assistant Secretary
14
<PAGE>
INVESTORS FIDUCIARY TRUST COMPANY
IDEX GROUP OF MUTUAL FUNDS
FEE SCHEDULE
January 1 - December 31, 1992
1. PORTFOLIO ACCOUNTING AND SECURITY CUSTODY
A. Minimum Monthly Asset Fee
There is a monthly minimum fee of $2,250 per fund/portfolio. The
monthly minimum fee per portfolio does not apply to any portfolio if
the asset based fees discussed in I.B. and I.C. below produces greater
revenue than the aggregate minimum would produce.
B. Domestic Securities
a. Asset-Based Fee on a Total Relationship Basis:
5.4/100 of l% (5.4 basis points) on the first $50 million is
assets 1.1/100 of l% (1.1 basis points) on all assets in excess
of $50 million
b. Transaction Fee
Per Domestic Transaction - $20.00
C. Foreign Securities
a. Asset Based Fee per fund:
22/100 of 1% (22 basis points) on all assets (January 1-June 30,
1992) 18/100 of 1% (18 basis points) on all assets (Effective
July 1, 1992)
b. Transaction Fee
Per Transaction - $20.00
c. Fees for Emerging Markets quoted on an "as needed" basis.
D. Balance Credits
IFTC will offset fees with balance credits calculated at 85% of the
bank credit rate (see below) applied to average custody collected cash
balances for the month. Balance credits will be applied on a fund by
fund basis and can be used to offset custody and portfolio accounting
fees. Any credits in excess of fees will be carried forward from month
to month through the end of the calendar year. For calculation
purposes, IFTC uses an actual/actual basis.
Note: The bank credit rate is the equivalent to the lesser of:
/bullet/ The average 91-day Treasury Bill discount rate for the month
or
/bullet/ The average Federal Funds rate for the month less 50 basis
points.
<PAGE>
Idex Group of Mutual Funds
Fee Schedule (Continued)
E. Overdraft Charges
Fund overdrafts will be calculated at the Prime rate (as published in
the Wall Street Journal) and charged on a daily basis.
II. NOTES TO THE ABOVE FEE SCHEDULE
A. Asset based fees are payable monthly at 1/12th of the annual stated
rate based on monthly average net assets, except for foreign
denominated assets which will be computed on month end market value.
The domestic securities asset based fee will be allocated to the
portfolios based upon each portfolio's proportionate share of the
total monthly average net assets. The foreign securities asset based
fee will be a direct charge to each portfolio which owns foreign
denominated securities.
B. The above schedule does not include out-of-pocket expenses that would
be incurred by IFTC on the fund's behalf. Examples of out-of-pocket
expenses include but are not limited to pricing services, postage,
mailing services, magnetic tapes, microfilm, microfiche, FDIC
insurance, foreign registration and script fees, and back-up recovery.
IFTC bills out-of-pocket expenses separately from service fees.
C. The fees stated above are exclusive of terminal equipment required in
the client's location(s) and communication line costs.
D. Any fees or out-of-pocket expenses not paid within 30 days of the date
of the original invoice will be charged a late payment fee of 1% per
month until payment of the fees are received by IFTC.
E. The above fee schedule is applicable for selections made and
communicated within 90 days of the date of this proposal. The fees are
guaranteed for a one year period commencing on the effective date of
the service agreement between IFTC and the client. All changes to the
fee schedule will be communicated in writing at least 60 days prior to
their effective date.
/S/ Stephen R. Hilliard /S/ Thomas R. Moriarty
- ------------------------ -----------------------
Stephen R. Hilliard Thomas R. Moriarty
INVESTORS FIDUCIARY TRUST COMPANY IDEX GROUP OF MUTUAL FUNDS
- ------------------------ -------------------------
DATE DATE
December 30, 1996
IDEX Series Fund
201 Highland Avenue
Largo, FL 34640
RE: IDEX Series Fund
Offering of Shares of Beneficial Interest
Gentlemen:
In my capacity as Vice President, Secretary and Counsel, I have acted as
counsel for IDEX Series Fund (the "Fund") and have reviewed the Registration
Statement under the Securities Act of 1933 on Form N-1A, and amendments thereto,
with respect to the offer and sale of shares of beneficial interest, no par
value, of the above-referenced Fund, including the "Rule 24f-2 Notice" for the
fiscal year ended October 31, 1996, registering such shares pursuant to such
Registration Statement, as amended, in accordance with Rule 24f-2 under the
Investment Company Act of 1940.
I have examined the Fund's Declaration of Trust and Bylaws, as amended; the
proceedings of its Board of Trustees relating to the authorization, issuance,
and proposed sales of the shares; and such other records and documents as I
deemed relevant. Based upon such examination, it is my opinion that upon the
issuance and sale of the shares of beneficial interest of the Fund in the manner
contemplated by the aforesaid Registration Statement, as amended, such shares
were validly issued, fully paid and nonassessable outstanding shares of
beneficial interest of the Fund.
Very truly yours,
/S/
Becky A. Ferrell
Vice President, Secretary and Counsel
November 29, 1996
IDEX Series Fund
201 Highland Avenue
Largo, FL 34640
RE: IDEX Series Fund
Offering of Shares of Beneficial Interest
Gentlemen:
In my capacity as Vice President, Secretary and Counsel, I have acted as
counsel for IDEX Series Fund (the "Fund") and have reviewed the Registration
Statement under the Securities Act of 1933 on Form N-1A, and amendments thereto,
with respect to the offer and sale of shares of beneficial interest, no par
value, of the above-referenced Fund, including the "Rule 24f-2 Notice" for the
fiscal year ended September 30, 1996, registering such shares pursuant to such
Registration Statement, as amended, in accordance with Rule 24f-2 under the
Investment Company Act of 1940.
I have examined the Fund's Declaration of Trust and Bylaws, as amended; the
proceedings of its Board of Trustees relating to the authorization, issuance,
and proposed sales of the shares; and such other records and documents as I
deemed relevant. Based upon such examination, it is my opinion that upon the
issuance and sale of the shares of beneficial interest of the Fund in the manner
contemplated by the aforesaid Registration Statement, as amended, such shares
were validly issued, fully paid and nonassessable outstanding shares of
beneficial interest of the Fund.
Very truly yours,
/S/
Becky A. Ferrell
Vice President, Secretary and Counsel
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus and
Statement of Additional Information constituting parts of this Post-Effective
Amendment No. 25 to the registration statement on Form N-1A (the "Registration
Statement") of our report dated November 8, 1996 and November 25, 1996, relating
to the financial statements and financial highlights appearing in the September
30, 1996 and October 31, 1996 Annual Report to Shareholders of the IDEX Series
Fund, which is also incorporated by reference into the Registration Statement.
We also consent to the references to us under the heading "Financial Highlights"
in the Prospectus and under the heading "Legal Counsel and Auditors" in the
Statement of Additional Information.
PRICE WATERHOUSE LLP
Kansas City, Missouri
January 30, 1997
[Letterhead]
CONSENT OF SUTHERLAND, ASBILL & BRENNAN, L.L.P.
We consent to the reference to our firm under the heading "Legal Counsel
and Auditors" in the statement of additional information included in
Post-Effective Amendment No. 25 to the Registration Statement on Form N-1A for
IDEX Series Fund (File No. 33-2659). In giving this consent, we do not admit
that we are in the category of persons whose consent is required under Section 7
of the Securities Act of 1933.
SUTHERLAND, ASBILL & BRENNAN, L.L.P.
By: /s/ Kimberly J. Smith
Kimberly J. Smith
Washington, D.C.
January 30, 1997
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX AGGRESSIVE GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 061
<NAME> IDEX AGGRESSIVE GROWTH/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 22,451
<INVESTMENTS-AT-VALUE> 25,951
<RECEIVABLES> 437
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 26,388
<PAYABLE-FOR-SECURITIES> 202
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 127
<TOTAL-LIABILITIES> 329
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 24,014
<SHARES-COMMON-STOCK> 1,397
<SHARES-COMMON-PRIOR> 1,402
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,455)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,501
<NET-ASSETS> 26,059
<DIVIDEND-INCOME> 12
<INTEREST-INCOME> 6
<OTHER-INCOME> 0
<EXPENSES-NET> 44
<NET-INVESTMENT-INCOME> (26)
<REALIZED-GAINS-CURRENT> 248
<APPREC-INCREASE-CURRENT> (301)
<NET-CHANGE-FROM-OPS> (79)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 45
<NUMBER-OF-SHARES-REDEEMED> 50
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (69)
<ACCUMULATED-NII-PRIOR> (1)
<ACCUMULATED-GAINS-PRIOR> (1,703)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 23
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 44
<AVERAGE-NET-ASSETS> 22,443
<PER-SHARE-NAV-BEGIN> 15.75
<PER-SHARE-NII> (.01)
<PER-SHARE-GAIN-APPREC> (.04)
<PER-SHARE-DIVIDEND> 0
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<PER-SHARE-NAV-END> 15.70
<EXPENSE-RATIO> 1.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX AGGRESSIVE GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 062
<NAME> IDEX AGGRESSIVE GROWTH/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 22,451
<INVESTMENTS-AT-VALUE> 25,951
<RECEIVABLES> 437
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<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 26,388
<PAYABLE-FOR-SECURITIES> 202
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 127
<TOTAL-LIABILITIES> 329
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 24,014
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<SHARES-COMMON-PRIOR> 115
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,455)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,501
<NET-ASSETS> 26,059
<DIVIDEND-INCOME> 12
<INTEREST-INCOME> 6
<OTHER-INCOME> 0
<EXPENSES-NET> 44
<NET-INVESTMENT-INCOME> (26)
<REALIZED-GAINS-CURRENT> 248
<APPREC-INCREASE-CURRENT> (301)
<NET-CHANGE-FROM-OPS> (75)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 13
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (69)
<ACCUMULATED-NII-PRIOR> (1)
<ACCUMULATED-GAINS-PRIOR> (1,703)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 23
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 44
<AVERAGE-NET-ASSETS> 1,905
<PER-SHARE-NAV-BEGIN> 15.63
<PER-SHARE-NII> (.01)
<PER-SHARE-GAIN-APPREC> (.04)
<PER-SHARE-DIVIDEND> 0
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<PER-SHARE-NAV-END> 15.58
<EXPENSE-RATIO> 2.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX AGGRESSIVE GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 063
<NAME> IDEX AGGRESSIVE GROWTH/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 22,451
<INVESTMENTS-AT-VALUE> 25,951
<RECEIVABLES> 437
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<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 26,388
<PAYABLE-FOR-SECURITIES> 202
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 127
<TOTAL-LIABILITIES> 329
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 24,014
<SHARES-COMMON-STOCK> 137
<SHARES-COMMON-PRIOR> 144
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,455)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,501
<NET-ASSETS> 26,059
<DIVIDEND-INCOME> 12
<INTEREST-INCOME> 6
<OTHER-INCOME> 0
<EXPENSES-NET> 44
<NET-INVESTMENT-INCOME> (26)
<REALIZED-GAINS-CURRENT> 248
<APPREC-INCREASE-CURRENT> (301)
<NET-CHANGE-FROM-OPS> (79)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3
<NUMBER-OF-SHARES-REDEEMED> 10
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (69)
<ACCUMULATED-NII-PRIOR> (1)
<ACCUMULATED-GAINS-PRIOR> (1,703)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 23
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 44
<AVERAGE-NET-ASSETS> 2,211
<PER-SHARE-NAV-BEGIN> 15.65
<PER-SHARE-NII> (.01)
<PER-SHARE-GAIN-APPREC> (.04)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.60
<EXPENSE-RATIO> 2.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX CAPITAL APPRECIATION FOR THE PERIOD ENDED OCTOBER 31, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 071
<NAME> IDEX CAPITAL APPRECIATION/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 20,318
<INVESTMENTS-AT-VALUE> 23,331
<RECEIVABLES> 560
<ASSETS-OTHER> 211
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 24,102
<PAYABLE-FOR-SECURITIES> 262
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 115
<TOTAL-LIABILITIES> 377
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 20,480
<SHARES-COMMON-STOCK> 1,249
<SHARES-COMMON-PRIOR> 1,188
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 285
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,961
<NET-ASSETS> 23,725
<DIVIDEND-INCOME> 4
<INTEREST-INCOME> 5
<OTHER-INCOME> 0
<EXPENSES-NET> 40
<NET-INVESTMENT-INCOME> (31)
<REALIZED-GAINS-CURRENT> (27)
<APPREC-INCREASE-CURRENT> (358)
<NET-CHANGE-FROM-OPS> (416)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 231
<NUMBER-OF-SHARES-REDEEMED> 170
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 621
<ACCUMULATED-NII-PRIOR> (67)
<ACCUMULATED-GAINS-PRIOR> 431
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 20
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 40
<AVERAGE-NET-ASSETS> 19,395
<PER-SHARE-NAV-BEGIN> 15.75
<PER-SHARE-NII> (0.02)
<PER-SHARE-GAIN-APPREC> (0.24)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.49
<EXPENSE-RATIO> 1.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX CAPITAL APPRECIATION FOR THE PERIOD ENDED OCTOBER 31, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 072
<NAME> IDEX CAPITAL APPRECIATION/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 20,318
<INVESTMENTS-AT-VALUE> 23,331
<RECEIVABLES> 560
<ASSETS-OTHER> 211
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 24,102
<PAYABLE-FOR-SECURITIES> 262
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 115
<TOTAL-LIABILITIES> 377
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 20,480
<SHARES-COMMON-STOCK> 138
<SHARES-COMMON-PRIOR> 129
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 285
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,961
<NET-ASSETS> 23,725
<DIVIDEND-INCOME> 4
<INTEREST-INCOME> 5
<OTHER-INCOME> 0
<EXPENSES-NET> 40
<NET-INVESTMENT-INCOME> (31)
<REALIZED-GAINS-CURRENT> (27)
<APPREC-INCREASE-CURRENT> (358)
<NET-CHANGE-FROM-OPS> (416)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 14
<NUMBER-OF-SHARES-REDEEMED> 5
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 621
<ACCUMULATED-NII-PRIOR> (67)
<ACCUMULATED-GAINS-PRIOR> 431
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 20
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 40
<AVERAGE-NET-ASSETS> 2,117
<PER-SHARE-NAV-BEGIN> 15.69
<PER-SHARE-NII> (0.03)
<PER-SHARE-GAIN-APPREC> (0.24)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.42
<EXPENSE-RATIO> 2.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX CAPITAL APPRECIATION FOR THE PERIOD ENDED OCTOBER 31, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 00787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 073
<NAME> IDEX CAPITAL APPRECIATION/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 20,318
<INVESTMENTS-AT-VALUE> 23,331
<RECEIVABLES> 560
<ASSETS-OTHER> 211
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 24,102
<PAYABLE-FOR-SECURITIES> 262
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 115
<TOTAL-LIABILITIES> 377
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 20,480
<SHARES-COMMON-STOCK> 145
<SHARES-COMMON-PRIOR> 151
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 285
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,961
<NET-ASSETS> 23,725
<DIVIDEND-INCOME> 4
<INTEREST-INCOME> 5
<OTHER-INCOME> 0
<EXPENSES-NET> 40
<NET-INVESTMENT-INCOME> (31)
<REALIZED-GAINS-CURRENT> (27)
<APPREC-INCREASE-CURRENT> (358)
<NET-CHANGE-FROM-OPS> (416)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 7
<NUMBER-OF-SHARES-REDEEMED> 13
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 621
<ACCUMULATED-NII-PRIOR> (67)
<ACCUMULATED-GAINS-PRIOR> 431
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 20
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 40
<AVERAGE-NET-ASSETS> 2,285
<PER-SHARE-NAV-BEGIN> 15.70
<PER-SHARE-NII> (0.03)
<PER-SHARE-GAIN-APPREC> (0.24)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.43
<EXPENSE-RATIO> 2.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GLOBAL FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 041
<NAME> IDEX GLOBAL/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 125,393
<INVESTMENTS-AT-VALUE> 147,650
<RECEIVABLES> 3,905
<ASSETS-OTHER> 663
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 152,218
<PAYABLE-FOR-SECURITIES> 661
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,130
<TOTAL-LIABILITIES> 1,791
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 112,843
<SHARES-COMMON-STOCK> 6,349
<SHARES-COMMON-PRIOR> 6,138
<ACCUMULATED-NII-CURRENT> (13)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 15,055
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 22,542
<NET-ASSETS> 150,427
<DIVIDEND-INCOME> 67
<INTEREST-INCOME> 50
<OTHER-INCOME> 0
<EXPENSES-NET> 270
<NET-INVESTMENT-INCOME> (153)
<REALIZED-GAINS-CURRENT> 2,413
<APPREC-INCREASE-CURRENT> (2,313)
<NET-CHANGE-FROM-OPS> (53)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 341
<NUMBER-OF-SHARES-REDEEMED> 130
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 5,999
<ACCUMULATED-NII-PRIOR> (13)
<ACCUMULATED-GAINS-PRIOR> 12,795
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 127
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 272
<AVERAGE-NET-ASSETS> 135,478
<PER-SHARE-NAV-BEGIN> 21.40
<PER-SHARE-NII> (0.02)
<PER-SHARE-GAIN-APPREC> 0.01
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.39
<EXPENSE-RATIO> 2.07
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GLOBAL FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 042
<NAME> IDEX GLOBAL/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 125,393
<INVESTMENTS-AT-VALUE> 147,650
<RECEIVABLES> 3,905
<ASSETS-OTHER> 663
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 152,218
<PAYABLE-FOR-SECURITIES> 661
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,130
<TOTAL-LIABILITIES> 1,791
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 112,843
<SHARES-COMMON-STOCK> 282
<SHARES-COMMON-PRIOR> 237
<ACCUMULATED-NII-CURRENT> (13)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 15,055
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 22,542
<NET-ASSETS> 150,427
<DIVIDEND-INCOME> 67
<INTEREST-INCOME> 50
<OTHER-INCOME> 0
<EXPENSES-NET> 270
<NET-INVESTMENT-INCOME> (153)
<REALIZED-GAINS-CURRENT> 2,413
<APPREC-INCREASE-CURRENT> (2,313)
<NET-CHANGE-FROM-OPS> (53)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 49
<NUMBER-OF-SHARES-REDEEMED> 4
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 5,999
<ACCUMULATED-NII-PRIOR> (13)
<ACCUMULATED-GAINS-PRIOR> 12,795
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 127
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 272
<AVERAGE-NET-ASSETS> 5,562
<PER-SHARE-NAV-BEGIN> 21.14
<PER-SHARE-NII> (0.02)
<PER-SHARE-GAIN-APPREC> 0.01
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.13
<EXPENSE-RATIO> 2.72
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GLOBAL FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 043
<NAME> IDEX GLOBAL/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 125,393
<INVESTMENTS-AT-VALUE> 147,650
<RECEIVABLES> 3,905
<ASSETS-OTHER> 663
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 152,218
<PAYABLE-FOR-SECURITIES> 661
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,130
<TOTAL-LIABILITIES> 1,791
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 112,843
<SHARES-COMMON-STOCK> 410
<SHARES-COMMON-PRIOR> 384
<ACCUMULATED-NII-CURRENT> (13)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 15,055
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 22,542
<NET-ASSETS> 150,427
<DIVIDEND-INCOME> 67
<INTEREST-INCOME> 50
<OTHER-INCOME> 0
<EXPENSES-NET> 270
<NET-INVESTMENT-INCOME> (153)
<REALIZED-GAINS-CURRENT> 2,413
<APPREC-INCREASE-CURRENT> (2,313)
<NET-CHANGE-FROM-OPS> (53)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 35
<NUMBER-OF-SHARES-REDEEMED> 9
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 5,999
<ACCUMULATED-NII-PRIOR> (13)
<ACCUMULATED-GAINS-PRIOR> 12,795
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 127
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 272
<AVERAGE-NET-ASSETS> 8,489
<PER-SHARE-NAV-BEGIN> 21.04
<PER-SHARE-NII> (0.02)
<PER-SHARE-GAIN-APPREC> 0.01
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.03
<EXPENSE-RATIO> 2.62
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 011
<NAME> IDEX GROWTH/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 828,975
<INVESTMENTS-AT-VALUE> 1,154,714
<RECEIVABLES> 9,282
<ASSETS-OTHER> 457
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,164,752
<PAYABLE-FOR-SECURITIES> 7,876
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,702
<TOTAL-LIABILITIES> 9,578
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 805,278
<SHARES-COMMON-STOCK> 25,720
<SHARES-COMMON-PRIOR> 25,553
<ACCUMULATED-NII-CURRENT> 20
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 23,722
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 326,154
<NET-ASSETS> 1,155,174
<DIVIDEND-INCOME> 622
<INTEREST-INCOME> 917
<OTHER-INCOME> 0
<EXPENSES-NET> 1,505
<NET-INVESTMENT-INCOME> 34
<REALIZED-GAINS-CURRENT> 18,010
<APPREC-INCREASE-CURRENT> (30,572)
<NET-CHANGE-FROM-OPS> (12,528)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 690
<NUMBER-OF-SHARES-REDEEMED> 523
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (13,598)
<ACCUMULATED-NII-PRIOR> (44)
<ACCUMULATED-GAINS-PRIOR> 5,735
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 953
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,505
<AVERAGE-NET-ASSETS> 571,000
<PER-SHARE-NAV-BEGIN> 22.21
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> (0.24)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.97
<EXPENSE-RATIO> 1.68
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 012
<NAME> IDEX GROWTH/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 828,975
<INVESTMENTS-AT-VALUE> 1,154,714
<RECEIVABLES> 9,282
<ASSETS-OTHER> 457
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,164,752
<PAYABLE-FOR-SECURITIES> 7,876
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,702
<TOTAL-LIABILITIES> 9,578
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 805,278
<SHARES-COMMON-STOCK> 243
<SHARES-COMMON-PRIOR> 208
<ACCUMULATED-NII-CURRENT> 20
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 23,722
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 326,154
<NET-ASSETS> 1,155,174
<DIVIDEND-INCOME> 622
<INTEREST-INCOME> 917
<OTHER-INCOME> 0
<EXPENSES-NET> 1,505
<NET-INVESTMENT-INCOME> 34
<REALIZED-GAINS-CURRENT> 18,010
<APPREC-INCREASE-CURRENT> (30,572)
<NET-CHANGE-FROM-OPS> (12,528)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 36
<NUMBER-OF-SHARES-REDEEMED> 1
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (13,598)
<ACCUMULATED-NII-PRIOR> (44)
<ACCUMULATED-GAINS-PRIOR> 5,735
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 953
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,505
<AVERAGE-NET-ASSETS> 4,971
<PER-SHARE-NAV-BEGIN> 21.85
<PER-SHARE-NII> (0.01)
<PER-SHARE-GAIN-APPREC> (0.24)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.60
<EXPENSE-RATIO> 2.32
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 013
<NAME> IDEX GROWTH/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 828,975
<INVESTMENTS-AT-VALUE> 1,154,714
<RECEIVABLES> 9,282
<ASSETS-OTHER> 457
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,164,752
<PAYABLE-FOR-SECURITIES> 7,876
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,702
<TOTAL-LIABILITIES> 9,578
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 805,278
<SHARES-COMMON-STOCK> 509
<SHARES-COMMON-PRIOR> 510
<ACCUMULATED-NII-CURRENT> 20
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 23,722
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 326,154
<NET-ASSETS> 1,155,174
<DIVIDEND-INCOME> 622
<INTEREST-INCOME> 917
<OTHER-INCOME> 0
<EXPENSES-NET> 1,505
<NET-INVESTMENT-INCOME> 34
<REALIZED-GAINS-CURRENT> 18,010
<APPREC-INCREASE-CURRENT> (30,598)
<NET-CHANGE-FROM-OPS> (12,528)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 21
<NUMBER-OF-SHARES-REDEEMED> 22
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (13,598)
<ACCUMULATED-NII-PRIOR> (44)
<ACCUMULATED-GAINS-PRIOR> 5,735
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 953
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,505
<AVERAGE-NET-ASSETS> 11,222
<PER-SHARE-NAV-BEGIN> 21.91
<PER-SHARE-NII> (0.02)
<PER-SHARE-GAIN-APPREC> (0.24)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.65
<EXPENSE-RATIO> 2.23
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 014
<NAME> IDEX GROWTH/CLASS T
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 828,975
<INVESTMENTS-AT-VALUE> 1,154,714
<RECEIVABLES> 9,282
<ASSETS-OTHER> 457
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,164,752
<PAYABLE-FOR-SECURITIES> 7,876
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,702
<TOTAL-LIABILITIES> 9,578
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 805,278
<SHARES-COMMON-STOCK> 25,887
<SHARES-COMMON-PRIOR> 26,132
<ACCUMULATED-NII-CURRENT> 20
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 23,722
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 326,154
<NET-ASSETS> 1,155,174
<DIVIDEND-INCOME> 620
<INTEREST-INCOME> 917
<OTHER-INCOME> 0
<EXPENSES-NET> 1,505
<NET-INVESTMENT-INCOME> 34
<REALIZED-GAINS-CURRENT> 18,010
<APPREC-INCREASE-CURRENT> (30,572)
<NET-CHANGE-FROM-OPS> (12,528)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 136
<NUMBER-OF-SHARES-REDEEMED> 381
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (13,598)
<ACCUMULATED-NII-PRIOR> (44)
<ACCUMULATED-GAINS-PRIOR> 5,735
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 953
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,505
<AVERAGE-NET-ASSETS> 585,302
<PER-SHARE-NAV-BEGIN> 22.41
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0.24
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 22.17
<EXPENSE-RATIO> 1.33
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX C.A.S.E. GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 111
<NAME> IDEX C.A.S.E./CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 3,502
<INVESTMENTS-AT-VALUE> 3,625
<RECEIVABLES> 36
<ASSETS-OTHER> 19
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,680
<PAYABLE-FOR-SECURITIES> 128
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 31
<TOTAL-LIABILITIES> 159
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,401
<SHARES-COMMON-STOCK> 158
<SHARES-COMMON-PRIOR> 13
<ACCUMULATED-NII-CURRENT> 175
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (178)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 123
<NET-ASSETS> 3,521
<DIVIDEND-INCOME> 2
<INTEREST-INCOME> 3
<OTHER-INCOME> 0
<EXPENSES-NET> 6
<NET-INVESTMENT-INCOME> (1)
<REALIZED-GAINS-CURRENT> 12
<APPREC-INCREASE-CURRENT> 21
<NET-CHANGE-FROM-OPS> 32
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 20
<NUMBER-OF-SHARES-REDEEMED> 1
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 353
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 3
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6
<AVERAGE-NET-ASSETS> 1,570
<PER-SHARE-NAV-BEGIN> 10.46
<PER-SHARE-NII> (0.07)
<PER-SHARE-GAIN-APPREC> 0.17
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.56
<EXPENSE-RATIO> 1.84
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX C.A.S.E. GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 112
<NAME> IDEX C.A.S.E./CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 3,502
<INVESTMENTS-AT-VALUE> 3,625
<RECEIVABLES> 36
<ASSETS-OTHER> 19
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,680
<PAYABLE-FOR-SECURITIES> 128
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 31
<TOTAL-LIABILITIES> 159
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,401
<SHARES-COMMON-STOCK> 110
<SHARES-COMMON-PRIOR> 106
<ACCUMULATED-NII-CURRENT> 175
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (178)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 123
<NET-ASSETS> 3,521
<DIVIDEND-INCOME> 2
<INTEREST-INCOME> 3
<OTHER-INCOME> 0
<EXPENSES-NET> 6
<NET-INVESTMENT-INCOME> (1)
<REALIZED-GAINS-CURRENT> 12
<APPREC-INCREASE-CURRENT> 21
<NET-CHANGE-FROM-OPS> 32
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 6
<NUMBER-OF-SHARES-REDEEMED> 2
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 353
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 3
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6
<AVERAGE-NET-ASSETS> 1,119
<PER-SHARE-NAV-BEGIN> 10.41
<PER-SHARE-NII> (0.07)
<PER-SHARE-GAIN-APPREC> 0.17
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.51
<EXPENSE-RATIO> 2.49
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX II C.A.S.E GROWTH FOR THE PERIOD ENDED OCTOBER 31, 1996, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 113
<NAME> IDEX C.A.S.E./CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 3,502
<INVESTMENTS-AT-VALUE> 3,625
<RECEIVABLES> 36
<ASSETS-OTHER> 19
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,680
<PAYABLE-FOR-SECURITIES> 128
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 31
<TOTAL-LIABILITIES> 159
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,401
<SHARES-COMMON-STOCK> 65
<SHARES-COMMON-PRIOR> 59
<ACCUMULATED-NII-CURRENT> 175
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (178)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 123
<NET-ASSETS> 3,521
<DIVIDEND-INCOME> 2
<INTEREST-INCOME> 3
<OTHER-INCOME> 0
<EXPENSES-NET> 6
<NET-INVESTMENT-INCOME> (1)
<REALIZED-GAINS-CURRENT> 12
<APPREC-INCREASE-CURRENT> 21
<NET-CHANGE-FROM-OPS> 32
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 14
<NUMBER-OF-SHARES-REDEEMED> 8
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 353
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 3
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6
<AVERAGE-NET-ASSETS> 634
<PER-SHARE-NAV-BEGIN> 10.42
<PER-SHARE-NII> (0.07)
<PER-SHARE-GAIN-APPREC> 0.17
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.52
<EXPENSE-RATIO> 2.39
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX II TACTICAL ASSET ALLOCATION FOR THE PERIOD ENDED OCTOBER 31,
1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 101
<NAME> IDEX TACTICAL ASSET ALLOCATION/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 17,493
<INVESTMENTS-AT-VALUE> 18,198
<RECEIVABLES> 209
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 18,407
<PAYABLE-FOR-SECURITIES> 110
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 130
<TOTAL-LIABILITIES> 240
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,386
<SHARES-COMMON-STOCK> 750
<SHARES-COMMON-PRIOR> 671
<ACCUMULATED-NII-CURRENT> 14
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 62
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 705
<NET-ASSETS> 18,167
<DIVIDEND-INCOME> 10
<INTEREST-INCOME> 36
<OTHER-INCOME> 0
<EXPENSES-NET> 32
<NET-INVESTMENT-INCOME> 14
<REALIZED-GAINS-CURRENT> 14
<APPREC-INCREASE-CURRENT> 218
<NET-CHANGE-FROM-OPS> 246
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 87
<NUMBER-OF-SHARES-REDEEMED> 8
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 1,277
<ACCUMULATED-NII-PRIOR> 1
<ACCUMULATED-GAINS-PRIOR> 48
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 15
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 32
<AVERAGE-NET-ASSETS> 7,818
<PER-SHARE-NAV-BEGIN> 11.03
<PER-SHARE-NII> 0.02
<PER-SHARE-GAIN-APPREC> 0.14
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.19
<EXPENSE-RATIO> 1.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX II TACTICAL ASSET ALLOCATION FOR THE PERIOD ENDED OCTOBER 31,
1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 102
<NAME> IDEX TACTICAL ASSET ALLOCATION/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 17,493
<INVESTMENTS-AT-VALUE> 18,198
<RECEIVABLES> 209
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 18,407
<PAYABLE-FOR-SECURITIES> 110
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 130
<TOTAL-LIABILITIES> 240
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,386
<SHARES-COMMON-STOCK> 449
<SHARES-COMMON-PRIOR> 440
<ACCUMULATED-NII-CURRENT> 14
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 62
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 705
<NET-ASSETS> 18,167
<DIVIDEND-INCOME> 10
<INTEREST-INCOME> 36
<OTHER-INCOME> 0
<EXPENSES-NET> 32
<NET-INVESTMENT-INCOME> 14
<REALIZED-GAINS-CURRENT> 48
<APPREC-INCREASE-CURRENT> 218
<NET-CHANGE-FROM-OPS> 246
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 18
<NUMBER-OF-SHARES-REDEEMED> 9
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 1,277
<ACCUMULATED-NII-PRIOR> 1
<ACCUMULATED-GAINS-PRIOR> 48
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 15
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 32
<AVERAGE-NET-ASSETS> 4,935
<PER-SHARE-NAV-BEGIN> 11.02
<PER-SHARE-NII> 0.02
<PER-SHARE-GAIN-APPREC> 0.14
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.18
<EXPENSE-RATIO> 2.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX II TACTICAL ASSET ALLOCATION FOR THE PERIOD ENDED OCTOBER 31,
1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 103
<NAME> IDEX TACTICAL ASSET ALLOCATION/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 17,493
<INVESTMENTS-AT-VALUE> 18,198
<RECEIVABLES> 209
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 18,407
<PAYABLE-FOR-SECURITIES> 110
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 130
<TOTAL-LIABILITIES> 240
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,386
<SHARES-COMMON-STOCK> 425
<SHARES-COMMON-PRIOR> 421
<ACCUMULATED-NII-CURRENT> 14
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 62
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 705
<NET-ASSETS> 18,167
<DIVIDEND-INCOME> 10
<INTEREST-INCOME> 36
<OTHER-INCOME> 0
<EXPENSES-NET> 32
<NET-INVESTMENT-INCOME> 14
<REALIZED-GAINS-CURRENT> 14
<APPREC-INCREASE-CURRENT> 218
<NET-CHANGE-FROM-OPS> 246
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 20
<NUMBER-OF-SHARES-REDEEMED> 16
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 1,277
<ACCUMULATED-NII-PRIOR> 1
<ACCUMULATED-GAINS-PRIOR> 48
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 15
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 32
<AVERAGE-NET-ASSETS> 4,686
<PER-SHARE-NAV-BEGIN> 11.03
<PER-SHARE-NII> 0.01
<PER-SHARE-GAIN-APPREC> 0.14
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.18
<EXPENSE-RATIO> 2.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX EQUITY-INCOME FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 081
<NAME> IDEX EQUITY-INCOME/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 13,847
<INVESTMENTS-AT-VALUE> 15,164
<RECEIVABLES> 292
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 15,456
<PAYABLE-FOR-SECURITIES> 160
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 76
<TOTAL-LIABILITIES> 236
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 13,493
<SHARES-COMMON-STOCK> 875
<SHARES-COMMON-PRIOR> 853
<ACCUMULATED-NII-CURRENT> 34
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 376
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,317
<NET-ASSETS> 15,220
<DIVIDEND-INCOME> 20
<INTEREST-INCOME> 22
<OTHER-INCOME> 0
<EXPENSES-NET> 25
<NET-INVESTMENT-INCOME> 17
<REALIZED-GAINS-CURRENT> 36
<APPREC-INCREASE-CURRENT> 120
<NET-CHANGE-FROM-OPS> 173
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 48
<NUMBER-OF-SHARES-REDEEMED> 26
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 641
<ACCUMULATED-NII-PRIOR> 17
<ACCUMULATED-GAINS-PRIOR> 339
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 13
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 25
<AVERAGE-NET-ASSETS> 11,503
<PER-SHARE-NAV-BEGIN> 13.27
<PER-SHARE-NII> 0.01
<PER-SHARE-GAIN-APPREC> 0.15
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.43
<EXPENSE-RATIO> 1.82
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX EQUITY-INCOME FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 082
<NAME> IDEX EQUITY-INCOME/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 13,847
<INVESTMENTS-AT-VALUE> 15,164
<RECEIVABLES> 292
<ASSETS-OTHER> 6
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 15,456
<PAYABLE-FOR-SECURITIES> 160
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 76
<TOTAL-LIABILITIES> 236
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 13,493
<SHARES-COMMON-STOCK> 125
<SHARES-COMMON-PRIOR> 116
<ACCUMULATED-NII-CURRENT> 34
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 376
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,317
<NET-ASSETS> 15,220
<DIVIDEND-INCOME> 20
<INTEREST-INCOME> 22
<OTHER-INCOME> 0
<EXPENSES-NET> 25
<NET-INVESTMENT-INCOME> 17
<REALIZED-GAINS-CURRENT> 36
<APPREC-INCREASE-CURRENT> 120
<NET-CHANGE-FROM-OPS> 173
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 10
<NUMBER-OF-SHARES-REDEEMED> 1
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 641
<ACCUMULATED-NII-PRIOR> 17
<ACCUMULATED-GAINS-PRIOR> 339
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 13
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 25
<AVERAGE-NET-ASSETS> 1,625
<PER-SHARE-NAV-BEGIN> 13.27
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0.15
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.42
<EXPENSE-RATIO> 2.47
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX EQUITY-INCOME FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 083
<NAME> IDEX EQUITY-INCOME/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 13,847
<INVESTMENTS-AT-VALUE> 15,164
<RECEIVABLES> 292
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 15,456
<PAYABLE-FOR-SECURITIES> 160
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 76
<TOTAL-LIABILITIES> 236
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 13,493
<SHARES-COMMON-STOCK> 133
<SHARES-COMMON-PRIOR> 130
<ACCUMULATED-NII-CURRENT> 34
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 376
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,317
<NET-ASSETS> 15,220
<DIVIDEND-INCOME> 20
<INTEREST-INCOME> 22
<OTHER-INCOME> 0
<EXPENSES-NET> 25
<NET-INVESTMENT-INCOME> 17
<REALIZED-GAINS-CURRENT> 36
<APPREC-INCREASE-CURRENT> 120
<NET-CHANGE-FROM-OPS> 173
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 6
<NUMBER-OF-SHARES-REDEEMED> 3
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 641
<ACCUMULATED-NII-PRIOR> 17
<ACCUMULATED-GAINS-PRIOR> 339
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 13
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 25
<AVERAGE-NET-ASSETS> 1,770
<PER-SHARE-NAV-BEGIN> 13.27
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0.15
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.42
<EXPENSE-RATIO> 2.37
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX BALANCED FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 091
<NAME> IDEX BALANCED/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 9,626
<INVESTMENTS-AT-VALUE> 10,260
<RECEIVABLES> 227
<ASSETS-OTHER> 6
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 10,499
<PAYABLE-FOR-SECURITIES> 186
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 66
<TOTAL-LIABILITIES> 252
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 8,239
<SHARES-COMMON-STOCK> 619
<SHARES-COMMON-PRIOR> 598
<ACCUMULATED-NII-CURRENT> 23
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,358
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 627
<NET-ASSETS> 10,247
<DIVIDEND-INCOME> 6
<INTEREST-INCOME> 25
<OTHER-INCOME> 0
<EXPENSES-NET> 16
<NET-INVESTMENT-INCOME> 15
<REALIZED-GAINS-CURRENT> 74
<APPREC-INCREASE-CURRENT> (12)
<NET-CHANGE-FROM-OPS> 77
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 27
<NUMBER-OF-SHARES-REDEEMED> 6
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 561
<ACCUMULATED-NII-PRIOR> 9
<ACCUMULATED-GAINS-PRIOR> 1,282
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 8
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 16
<AVERAGE-NET-ASSETS> 8,312
<PER-SHARE-NAV-BEGIN> 13.47
<PER-SHARE-NII> 0.01
<PER-SHARE-GAIN-APPREC> 0.10
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.58
<EXPENSE-RATIO> 1.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX BALANCED FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 092
<NAME> IDEX BALANCED/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 9,626
<INVESTMENTS-AT-VALUE> 10,260
<RECEIVABLES> 227
<ASSETS-OTHER> 6
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 10,499
<PAYABLE-FOR-SECURITIES> 186
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 66
<TOTAL-LIABILITIES> 252
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 8,239
<SHARES-COMMON-STOCK> 65
<SHARES-COMMON-PRIOR> 51
<ACCUMULATED-NII-CURRENT> 23
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,358
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 627
<NET-ASSETS> 10,247
<DIVIDEND-INCOME> 6
<INTEREST-INCOME> 25
<OTHER-INCOME> 0
<EXPENSES-NET> 16
<NET-INVESTMENT-INCOME> 15
<REALIZED-GAINS-CURRENT> 74
<APPREC-INCREASE-CURRENT> (12)
<NET-CHANGE-FROM-OPS> 77
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 15
<NUMBER-OF-SHARES-REDEEMED> 1
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 561
<ACCUMULATED-NII-PRIOR> 9
<ACCUMULATED-GAINS-PRIOR> 1,282
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 8
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 16
<AVERAGE-NET-ASSETS> 733
<PER-SHARE-NAV-BEGIN> 13.46
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0.10
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.56
<EXPENSE-RATIO> 2.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
TATEMENTS OF IDEX BALANCED FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 093
<NAME> IDEX BALANCED/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 9,626
<INVESTMENTS-AT-VALUE> 10,260
<RECEIVABLES> 227
<ASSETS-OTHER> 6
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 10,499
<PAYABLE-FOR-SECURITIES> 186
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 66
<TOTAL-LIABILITIES> 252
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 8,239
<SHARES-COMMON-STOCK> 71
<SHARES-COMMON-PRIOR> 70
<ACCUMULATED-NII-CURRENT> 23
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,358
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 627
<NET-ASSETS> 10,247
<DIVIDEND-INCOME> 6
<INTEREST-INCOME> 25
<OTHER-INCOME> 0
<EXPENSES-NET> 16
<NET-INVESTMENT-INCOME> 15
<REALIZED-GAINS-CURRENT> 74
<APPREC-INCREASE-CURRENT> (12)
<NET-CHANGE-FROM-OPS> 77
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2
<NUMBER-OF-SHARES-REDEEMED> 1
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 561
<ACCUMULATED-NII-PRIOR> 9
<ACCUMULATED-GAINS-PRIOR> 1,282
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 8
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 16
<AVERAGE-NET-ASSETS> 960
<PER-SHARE-NAV-BEGIN> 13.46
<PER-SHARE-NII> 0.01
<PER-SHARE-GAIN-APPREC> 0.10
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.57
<EXPENSE-RATIO> 2.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX FLEXIBLE INCOME FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 051
<NAME> IDEX FLEXIBLE INCOME/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 17,927
<INVESTMENTS-AT-VALUE> 18,293
<RECEIVABLES> 373
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 18,677
<PAYABLE-FOR-SECURITIES> 250
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 58
<TOTAL-LIABILITIES> 308
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 20,705
<SHARES-COMMON-STOCK> 1,823
<SHARES-COMMON-PRIOR> 1,858
<ACCUMULATED-NII-CURRENT> 48
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (2,750)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 366
<NET-ASSETS> 18,369
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 125
<OTHER-INCOME> 0
<EXPENSES-NET> 30
<NET-INVESTMENT-INCOME> 95
<REALIZED-GAINS-CURRENT> 48
<APPREC-INCREASE-CURRENT> 241
<NET-CHANGE-FROM-OPS> 384
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 95
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 9
<NUMBER-OF-SHARES-REDEEMED> 52
<SHARES-REINVESTED> 8
<NET-CHANGE-IN-ASSETS> (73)
<ACCUMULATED-NII-PRIOR> 55
<ACCUMULATED-GAINS-PRIOR> (2,788)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 14
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 30
<AVERAGE-NET-ASSETS> 17,085
<PER-SHARE-NAV-BEGIN> 9.19
<PER-SHARE-NII> 0.20
<PER-SHARE-GAIN-APPREC> (0.01)
<PER-SHARE-DIVIDEND> 0.05
<PER-SHARE-DISTRIBUTIONS> 0.05
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.33
<EXPENSE-RATIO> 1.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX FLEXIBLE INCOME FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 052
<NAME> IDEX FLEXIBLE INCOME/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 17,927
<INVESTMENTS-AT-VALUE> 18,293
<RECEIVABLES> 373
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 18,677
<PAYABLE-FOR-SECURITIES> 250
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 58
<TOTAL-LIABILITIES> 308
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 20,705
<SHARES-COMMON-STOCK> 56
<SHARES-COMMON-PRIOR> 54
<ACCUMULATED-NII-CURRENT> 48
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (2,750)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 366
<NET-ASSETS> 18,369
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 125
<OTHER-INCOME> 0
<EXPENSES-NET> 30
<NET-INVESTMENT-INCOME> 95
<REALIZED-GAINS-CURRENT> 48
<APPREC-INCREASE-CURRENT> 241
<NET-CHANGE-FROM-OPS> 384
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 2
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3
<NUMBER-OF-SHARES-REDEEMED> 1
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (73)
<ACCUMULATED-NII-PRIOR> 55
<ACCUMULATED-GAINS-PRIOR> (2,788)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 14
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 30
<AVERAGE-NET-ASSETS> 505
<PER-SHARE-NAV-BEGIN> 9.18
<PER-SHARE-NII> 0.20
<PER-SHARE-GAIN-APPREC> (0.01)
<PER-SHARE-DIVIDEND> 0.05
<PER-SHARE-DISTRIBUTIONS> 0.05
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.32
<EXPENSE-RATIO> 2.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX FLEXIBLE INCOME FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 053
<NAME> IDEX FLEXIBLE INCOME/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 17,927
<INVESTMENTS-AT-VALUE> 18,293
<RECEIVABLES> 373
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 18,677
<PAYABLE-FOR-SECURITIES> 250
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 58
<TOTAL-LIABILITIES> 308
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 20,705
<SHARES-COMMON-STOCK> 91
<SHARES-COMMON-PRIOR> 96
<ACCUMULATED-NII-CURRENT> 48
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (2,750)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 366
<NET-ASSETS> 18,369
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 125
<OTHER-INCOME> 0
<EXPENSES-NET> 30
<NET-INVESTMENT-INCOME> 95
<REALIZED-GAINS-CURRENT> 48
<APPREC-INCREASE-CURRENT> 241
<NET-CHANGE-FROM-OPS> 384
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 5
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 6
<NUMBER-OF-SHARES-REDEEMED> 11
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (73)
<ACCUMULATED-NII-PRIOR> 55
<ACCUMULATED-GAINS-PRIOR> (2,788)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 14
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 30
<AVERAGE-NET-ASSETS> 864
<PER-SHARE-NAV-BEGIN> 9.18
<PER-SHARE-NII> 0.20
<PER-SHARE-GAIN-APPREC> (0.01)
<PER-SHARE-DIVIDEND> 0.05
<PER-SHARE-DISTRIBUTIONS> 0.05
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.32
<EXPENSE-RATIO> 2.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX INCOME PLUS FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 031
<NAME> IDEX INCOME PLUS/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 66,270
<INVESTMENTS-AT-VALUE> 68,457
<RECEIVABLES> 1,622
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 70,079
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 209
<TOTAL-LIABILITIES> 209
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 66,967
<SHARES-COMMON-STOCK> 6,247
<SHARES-COMMON-PRIOR> 6,271
<ACCUMULATED-NII-CURRENT> 243
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 474
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,186
<NET-ASSETS> 69,870
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 407
<OTHER-INCOME> 0
<EXPENSES-NET> 80
<NET-INVESTMENT-INCOME> 327
<REALIZED-GAINS-CURRENT> 227
<APPREC-INCREASE-CURRENT> 1,216
<NET-CHANGE-FROM-OPS> 1,770
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 397
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 45
<NUMBER-OF-SHARES-REDEEMED> 96
<SHARES-REINVESTED> 27
<NET-CHANGE-IN-ASSETS> 1,160
<ACCUMULATED-NII-PRIOR> 332
<ACCUMULATED-GAINS-PRIOR> 248
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 35
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 80
<AVERAGE-NET-ASSETS> 65,841
<PER-SHARE-NAV-BEGIN> 10.41
<PER-SHARE-NII> 0.22
<PER-SHARE-GAIN-APPREC> 0.04
<PER-SHARE-DIVIDEND> 0.06
<PER-SHARE-DISTRIBUTIONS> 0.06
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.61
<EXPENSE-RATIO> 1.32
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX INCOME PLUS FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 032
<NAME> IDEX INCOME PLUS/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 66,270
<INVESTMENTS-AT-VALUE> 68,457
<RECEIVABLES> 1,622
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 70,079
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 209
<TOTAL-LIABILITIES> 209
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 66,967
<SHARES-COMMON-STOCK> 76
<SHARES-COMMON-PRIOR> 74
<ACCUMULATED-NII-CURRENT> 243
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 474
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,186
<NET-ASSETS> 69,870
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 407
<OTHER-INCOME> 0
<EXPENSES-NET> 80
<NET-INVESTMENT-INCOME> 327
<REALIZED-GAINS-CURRENT> 227
<APPREC-INCREASE-CURRENT> 1,216
<NET-CHANGE-FROM-OPS> 1,770
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3
<NUMBER-OF-SHARES-REDEEMED> 1
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 1,160
<ACCUMULATED-NII-PRIOR> 332
<ACCUMULATED-GAINS-PRIOR> 248
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 35
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 80
<AVERAGE-NET-ASSETS> 780
<PER-SHARE-NAV-BEGIN> 10.40
<PER-SHARE-NII> 0.23
<PER-SHARE-GAIN-APPREC> 0.04
<PER-SHARE-DIVIDEND> 0.06
<PER-SHARE-DISTRIBUTIONS> 0.06
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.61
<EXPENSE-RATIO> 1.97
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX INCOME PLUS FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 033
<NAME> IDEX INCOME PLUS/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 66,270
<INVESTMENTS-AT-VALUE> 68,457
<RECEIVABLES> 1,622
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 70,079
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 209
<TOTAL-LIABILITIES> 209
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 66,967
<SHARES-COMMON-STOCK> 262
<SHARES-COMMON-PRIOR> 258
<ACCUMULATED-NII-CURRENT> 243
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 474
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,186
<NET-ASSETS> 69,870
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 407
<OTHER-INCOME> 0
<EXPENSES-NET> 80
<NET-INVESTMENT-INCOME> 327
<REALIZED-GAINS-CURRENT> 227
<APPREC-INCREASE-CURRENT> 1,216
<NET-CHANGE-FROM-OPS> 1,770
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 16
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 15
<NUMBER-OF-SHARES-REDEEMED> 12
<SHARES-REINVESTED> 1
<NET-CHANGE-IN-ASSETS> 1,160
<ACCUMULATED-NII-PRIOR> 332
<ACCUMULATED-GAINS-PRIOR> 248
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 35
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 80
<AVERAGE-NET-ASSETS> 2,712
<PER-SHARE-NAV-BEGIN> 10.40
<PER-SHARE-NII> 0.23
<PER-SHARE-GAIN-APPREC> 0.04
<PER-SHARE-DIVIDEND> 0.06
<PER-SHARE-DISTRIBUTIONS> 0.06
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.61
<EXPENSE-RATIO> 1.87
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX TAX EXEMPT FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 021
<NAME> IDEX TAX EXEMPT/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLAR
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 25,185
<INVESTMENTS-AT-VALUE> 25,502
<RECEIVABLES> 510
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 26,012
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 436
<TOTAL-LIABILITIES> 436
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 25,042
<SHARES-COMMON-STOCK> 2,144
<SHARES-COMMON-PRIOR> 2,175
<ACCUMULATED-NII-CURRENT> 44
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 173
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 317
<NET-ASSETS> 25,576
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 122
<OTHER-INCOME> 0
<EXPENSES-NET> 22
<NET-INVESTMENT-INCOME> 100
<REALIZED-GAINS-CURRENT> (1)
<APPREC-INCREASE-CURRENT> 97
<NET-CHANGE-FROM-OPS> 196
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 101
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 14
<NUMBER-OF-SHARES-REDEEMED> 51
<SHARES-REINVESTED> 6
<NET-CHANGE-IN-ASSETS> (228)
<ACCUMULATED-NII-PRIOR> 49
<ACCUMULATED-GAINS-PRIOR> 174
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 13
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 22
<AVERAGE-NET-ASSETS> 24,641
<PER-SHARE-NAV-BEGIN> 11.36
<PER-SHARE-NII> 0.18
<PER-SHARE-GAIN-APPREC> (0.09)
<PER-SHARE-DIVIDEND> 0.05
<PER-SHARE-DISTRIBUTIONS> 0.05
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.40
<EXPENSE-RATIO> 1.00
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX TAX EXEMPT FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 022
<NAME> IDEX TAX EXEMPT/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLAR
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 25,185
<INVESTMENTS-AT-VALUE> 25,502
<RECEIVABLES> 510
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 26,012
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 436
<TOTAL-LIABILITIES> 436
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 25,042
<SHARES-COMMON-STOCK> 18
<SHARES-COMMON-PRIOR> 17
<ACCUMULATED-NII-CURRENT> 44
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 173
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 317
<NET-ASSETS> 25,576
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 122
<OTHER-INCOME> 0
<EXPENSES-NET> 22
<NET-INVESTMENT-INCOME> 100
<REALIZED-GAINS-CURRENT> (1)
<APPREC-INCREASE-CURRENT> 97
<NET-CHANGE-FROM-OPS> 196
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (228)
<ACCUMULATED-NII-PRIOR> 49
<ACCUMULATED-GAINS-PRIOR> 174
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 13
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 22
<AVERAGE-NET-ASSETS> 189
<PER-SHARE-NAV-BEGIN> 11.36
<PER-SHARE-NII> 0.17
<PER-SHARE-GAIN-APPREC> (0.09)
<PER-SHARE-DIVIDEND> 0.04
<PER-SHARE-DISTRIBUTIONS> 0.04
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.40
<EXPENSE-RATIO> 1.65
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX TAX EXEMPT FOR THE PERIOD ENDED OCTOBER 31, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 023
<NAME> IDEX TAX EXEMPT/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLAR
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 25,185
<INVESTMENTS-AT-VALUE> 25,502
<RECEIVABLES> 510
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 26,012
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 436
<TOTAL-LIABILITIES> 436
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 25,042
<SHARES-COMMON-STOCK> 82
<SHARES-COMMON-PRIOR> 80
<ACCUMULATED-NII-CURRENT> 44
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 173
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 317
<NET-ASSETS> 25,576
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 122
<OTHER-INCOME> 0
<EXPENSES-NET> 22
<NET-INVESTMENT-INCOME> 100
<REALIZED-GAINS-CURRENT> (1)
<APPREC-INCREASE-CURRENT> 97
<NET-CHANGE-FROM-OPS> 196
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 3
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 14
<NUMBER-OF-SHARES-REDEEMED> 12
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (228)
<ACCUMULATED-NII-PRIOR> 49
<ACCUMULATED-GAINS-PRIOR> 174
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 13
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 22
<AVERAGE-NET-ASSETS> 927
<PER-SHARE-NAV-BEGIN> 11.36
<PER-SHARE-NII> 0.17
<PER-SHARE-GAIN-APPREC> (0.09)
<PER-SHARE-DIVIDEND> 0.04
<PER-SHARE-DISTRIBUTIONS> 0.04
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.40
<EXPENSE-RATIO> 1.25
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<PAGE>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX AGGRESSIVE GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 061
<NAME> IDEX AGGRESSIVE GROWTH/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 22,799
<INVESTMENTS-AT-VALUE> 26,600
<RECEIVABLES> 465
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 27,065
<PAYABLE-FOR-SECURITIES> 861
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 76
<TOTAL-LIABILITIES> 937
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 24,031
<SHARES-COMMON-STOCK> 1,402
<SHARES-COMMON-PRIOR> 947
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1703)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,801
<NET-ASSETS> 26,128
<DIVIDEND-INCOME> 99
<INTEREST-INCOME> 60
<OTHER-INCOME> 0
<EXPENSES-NET> 438
<NET-INVESTMENT-INCOME> (279)
<REALIZED-GAINS-CURRENT> (1,319)
<APPREC-INCREASE-CURRENT> 743
<NET-CHANGE-FROM-OPS> (855)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 1,314
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1031
<NUMBER-OF-SHARES-REDEEMED> 649
<SHARES-REINVESTED> 73
<NET-CHANGE-IN-ASSETS> 7,645
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 1208
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 227
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 438
<AVERAGE-NET-ASSETS> 19,438
<PER-SHARE-NAV-BEGIN> 17.68
<PER-SHARE-NII> (.15)
<PER-SHARE-GAIN-APPREC> (.76)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 1.02
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.75
<EXPENSE-RATIO> 1.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX AGGRESSIVE GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 062
<NAME> IDEX AGGRESSIVE GROWTH/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 22,799
<INVESTMENTS-AT-VALUE> 26,600
<RECEIVABLES> 465
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 27,065
<PAYABLE-FOR-SECURITIES> 861
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 76
<TOTAL-LIABILITIES> 937
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 24,031
<SHARES-COMMON-STOCK> 115
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,703)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,801
<NET-ASSETS> 26,128
<DIVIDEND-INCOME> 99
<INTEREST-INCOME> 60
<OTHER-INCOME> 0
<EXPENSES-NET> 438
<NET-INVESTMENT-INCOME> (279)
<REALIZED-GAINS-CURRENT> (1,319)
<APPREC-INCREASE-CURRENT> 743
<NET-CHANGE-FROM-OPS> (855)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 1,314
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 131
<NUMBER-OF-SHARES-REDEEMED> 17
<SHARES-REINVESTED> 1
<NET-CHANGE-IN-ASSETS> 7,645
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 1208
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 227
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 438
<AVERAGE-NET-ASSETS> 781
<PER-SHARE-NAV-BEGIN> 17.64
<PER-SHARE-NII> (.23)
<PER-SHARE-GAIN-APPREC> (.76)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 1.02
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.63
<EXPENSE-RATIO> 2.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX AGGRESSIVE GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 063
<NAME> IDEX AGGRESSIVE GROWTH/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 22,799
<INVESTMENTS-AT-VALUE> 26,600
<RECEIVABLES> 465
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 27,065
<PAYABLE-FOR-SECURITIES> 861
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 76
<TOTAL-LIABILITIES> 937
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 24,031
<SHARES-COMMON-STOCK> 144
<SHARES-COMMON-PRIOR> 98
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,703)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,801
<NET-ASSETS> 26,128
<DIVIDEND-INCOME> 99
<INTEREST-INCOME> 60
<OTHER-INCOME> 0
<EXPENSES-NET> 438
<NET-INVESTMENT-INCOME> (279)
<REALIZED-GAINS-CURRENT> (1,319)
<APPREC-INCREASE-CURRENT> 743
<NET-CHANGE-FROM-OPS> (855)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 1,314
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 240
<NUMBER-OF-SHARES-REDEEMED> 206
<SHARES-REINVESTED> 12
<NET-CHANGE-IN-ASSETS> 7,645
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 1208
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 227
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 438
<AVERAGE-NET-ASSETS> 2,456
<PER-SHARE-NAV-BEGIN> 17.64
<PER-SHARE-NII> (.21)
<PER-SHARE-GAIN-APPREC> (.76)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 1.02
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.65
<EXPENSE-RATIO> 2.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX CAPITAL APPRECIATION FOR THE PERIOD ENDED SEPTEMBER 30, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 071
<NAME> IDEX CAPITAL APPRECIATION/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 20,622
<INVESTMENTS-AT-VALUE> 23,953
<RECEIVABLES> 1170
<ASSETS-OTHER> 227
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 25,350
<PAYABLE-FOR-SECURITIES> 1,627
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 619
<TOTAL-LIABILITIES> 2,246
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 19,474
<SHARES-COMMON-STOCK> 1,188
<SHARES-COMMON-PRIOR> 461
<ACCUMULATED-NII-CURRENT> (1)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 312
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,319
<NET-ASSETS> 23,104
<DIVIDEND-INCOME> 162
<INTEREST-INCOME> 52
<OTHER-INCOME> 0
<EXPENSES-NET> 281
<NET-INVESTMENT-INCOME> (67)
<REALIZED-GAINS-CURRENT> 431
<APPREC-INCREASE-CURRENT> 2,216
<NET-CHANGE-FROM-OPS> 2,580
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 36
<DISTRIBUTIONS-OF-GAINS> 591
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 990
<NUMBER-OF-SHARES-REDEEMED> 297
<SHARES-REINVESTED> 34
<NET-CHANGE-IN-ASSETS> 14,298
<ACCUMULATED-NII-PRIOR> 29
<ACCUMULATED-GAINS-PRIOR> 476
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 142
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 282
<AVERAGE-NET-ASSETS> 10,908
<PER-SHARE-NAV-BEGIN> 13.54
<PER-SHARE-NII> 0.06
<PER-SHARE-GAIN-APPREC> 3.04
<PER-SHARE-DIVIDEND> 0.07
<PER-SHARE-DISTRIBUTIONS> 0.82
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.75
<EXPENSE-RATIO> 1.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX CAPITAL APPRECIATION FOR THE PERIOD ENDED SEPTEMBER 30, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 072
<NAME> IDEX CAPITAL APPRECIATION/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 20,622
<INVESTMENTS-AT-VALUE> 23,953
<RECEIVABLES> 1170
<ASSETS-OTHER> 227
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 25,350
<PAYABLE-FOR-SECURITIES> 1,627
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 619
<TOTAL-LIABILITIES> 2,246
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 19,474
<SHARES-COMMON-STOCK> 129
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 312
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,319
<NET-ASSETS> 23,104
<DIVIDEND-INCOME> 162
<INTEREST-INCOME> 52
<OTHER-INCOME> 0
<EXPENSES-NET> 281
<NET-INVESTMENT-INCOME> (67)
<REALIZED-GAINS-CURRENT> 431
<APPREC-INCREASE-CURRENT> 2,216
<NET-CHANGE-FROM-OPS> 2,580
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1
<DISTRIBUTIONS-OF-GAINS> 591
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 137
<NUMBER-OF-SHARES-REDEEMED> 9
<SHARES-REINVESTED> 1
<NET-CHANGE-IN-ASSETS> 14,298
<ACCUMULATED-NII-PRIOR> 29
<ACCUMULATED-GAINS-PRIOR> 476
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 142
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 282
<AVERAGE-NET-ASSETS> 734
<PER-SHARE-NAV-BEGIN> 13.49
<PER-SHARE-NII> (0.02)
<PER-SHARE-GAIN-APPREC> 3.04
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0.82
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.69
<EXPENSE-RATIO> 2.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX CAPITAL APPRECIATION FOR THE PERIOD ENDED SEPTEMBER 30, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 00787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 073
<NAME> IDEX CAPITAL APPRECIATION/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 20,622
<INVESTMENTS-AT-VALUE> 23,953
<RECEIVABLES> 1,170
<ASSETS-OTHER> 227
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 25,350
<PAYABLE-FOR-SECURITIES> 1,627
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 619
<TOTAL-LIABILITIES> 2,246
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 19,474
<SHARES-COMMON-STOCK> 151
<SHARES-COMMON-PRIOR> 190
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 312
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,319
<NET-ASSETS> 23,104
<DIVIDEND-INCOME> 162
<INTEREST-INCOME> 52
<OTHER-INCOME> 0
<EXPENSES-NET> 281
<NET-INVESTMENT-INCOME> (67)
<REALIZED-GAINS-CURRENT> 431
<APPREC-INCREASE-CURRENT> 2,216
<NET-CHANGE-FROM-OPS> 2,580
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 2
<DISTRIBUTIONS-OF-GAINS> 591
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 264
<NUMBER-OF-SHARES-REDEEMED> 314
<SHARES-REINVESTED> 11
<NET-CHANGE-IN-ASSETS> 14,298
<ACCUMULATED-NII-PRIOR> 29
<ACCUMULATED-GAINS-PRIOR> 476
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 142
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 282
<AVERAGE-NET-ASSETS> 2,564
<PER-SHARE-NAV-BEGIN> 13.49
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 3.04
<PER-SHARE-DIVIDEND> 0.01
<PER-SHARE-DISTRIBUTIONS> 0.82
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.70
<EXPENSE-RATIO> 2.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GLOBAL FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 041
<NAME> IDEX GLOBAL/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 118,796
<INVESTMENTS-AT-VALUE> 143,357
<RECEIVABLES> 1,167
<ASSETS-OTHER> 581
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 145,105
<PAYABLE-FOR-SECURITIES> 118
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 559
<TOTAL-LIABILITIES> 677
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 106,791
<SHARES-COMMON-STOCK> 6,138
<SHARES-COMMON-PRIOR> 5,042
<ACCUMULATED-NII-CURRENT> (13)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 12,795
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 24,855
<NET-ASSETS> 144,428
<DIVIDEND-INCOME> 1,367
<INTEREST-INCOME> 211
<OTHER-INCOME> 0
<EXPENSES-NET> 2,375
<NET-INVESTMENT-INCOME> (797)
<REALIZED-GAINS-CURRENT> 15,721
<APPREC-INCREASE-CURRENT> 9,941
<NET-CHANGE-FROM-OPS> 24,865
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 3,252
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,964
<NUMBER-OF-SHARES-REDEEMED> 1,045
<SHARES-REINVESTED> 177
<NET-CHANGE-IN-ASSETS> 51,464
<ACCUMULATED-NII-PRIOR> (14)
<ACCUMULATED-GAINS-PRIOR> 899
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,131
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,404
<AVERAGE-NET-ASSETS> 105,986
<PER-SHARE-NAV-BEGIN> 17.73
<PER-SHARE-NII> (0.09)
<PER-SHARE-GAIN-APPREC> 4.38
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0.62
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.40
<EXPENSE-RATIO> 2.06
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GLOBAL FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 042
<NAME> IDEX GLOBAL/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 118,796
<INVESTMENTS-AT-VALUE> 143,357
<RECEIVABLES> 1,167
<ASSETS-OTHER> 581
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 145,105
<PAYABLE-FOR-SECURITIES> 118
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 559
<TOTAL-LIABILITIES> 677
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 106,791
<SHARES-COMMON-STOCK> 237
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> (13)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 12,795
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 24,855
<NET-ASSETS> 144,428
<DIVIDEND-INCOME> 1,367
<INTEREST-INCOME> 211
<OTHER-INCOME> 0
<EXPENSES-NET> 2,375
<NET-INVESTMENT-INCOME> (797)
<REALIZED-GAINS-CURRENT> 15,721
<APPREC-INCREASE-CURRENT> 9,941
<NET-CHANGE-FROM-OPS> 24,865
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 3,252
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 257
<NUMBER-OF-SHARES-REDEEMED> 20
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 51,464
<ACCUMULATED-NII-PRIOR> (14)
<ACCUMULATED-GAINS-PRIOR> 899
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,131
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,404
<AVERAGE-NET-ASSETS> 1,646
<PER-SHARE-NAV-BEGIN> 17.57
<PER-SHARE-NII> (0.19)
<PER-SHARE-GAIN-APPREC> 4.38
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0.62
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.14
<EXPENSE-RATIO> 2.71
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GLOBAL FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 043
<NAME> IDEX GLOBAL/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 118,796
<INVESTMENTS-AT-VALUE> 143,357
<RECEIVABLES> 1,167
<ASSETS-OTHER> 581
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 145,105
<PAYABLE-FOR-SECURITIES> 118
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 559
<TOTAL-LIABILITIES> 677
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 106,791
<SHARES-COMMON-STOCK> 384
<SHARES-COMMON-PRIOR> 204
<ACCUMULATED-NII-CURRENT> (13)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 12,795
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 24,855
<NET-ASSETS> 144,428
<DIVIDEND-INCOME> 1,367
<INTEREST-INCOME> 211
<OTHER-INCOME> 0
<EXPENSES-NET> 2,375
<NET-INVESTMENT-INCOME> (797)
<REALIZED-GAINS-CURRENT> 15,721
<APPREC-INCREASE-CURRENT> 9,941
<NET-CHANGE-FROM-OPS> 24,865
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 3,252
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 312
<NUMBER-OF-SHARES-REDEEMED> 140
<SHARES-REINVESTED> 8
<NET-CHANGE-IN-ASSETS> 51,464
<ACCUMULATED-NII-PRIOR> (14)
<ACCUMULATED-GAINS-PRIOR> 899
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,131
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,404
<AVERAGE-NET-ASSETS> 5,443
<PER-SHARE-NAV-BEGIN> 17.46
<PER-SHARE-NII> (0.18)
<PER-SHARE-GAIN-APPREC> 4.38
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0.62
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.04
<EXPENSE-RATIO> 2.61
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 011
<NAME> IDEX GROWTH/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 816,965
<INVESTMENTS-AT-VALUE> 1,173,250
<RECEIVABLES> 2,051
<ASSETS-OTHER> 527
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,175,828
<PAYABLE-FOR-SECURITIES> 4,600
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,456
<TOTAL-LIABILITIES> 7,056
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 806,354
<SHARES-COMMON-STOCK> 25,553
<SHARES-COMMON-PRIOR> 21,273
<ACCUMULATED-NII-CURRENT> (44)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 5,735
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 356,727
<NET-ASSETS> 1,168,772
<DIVIDEND-INCOME> 3,170
<INTEREST-INCOME> 5,513
<OTHER-INCOME> 0
<EXPENSES-NET> 9,880
<NET-INVESTMENT-INCOME> (1,197)
<REALIZED-GAINS-CURRENT> 71,706
<APPREC-INCREASE-CURRENT> 223,454
<NET-CHANGE-FROM-OPS> 293,963
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 116,218
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3,212
<NUMBER-OF-SHARES-REDEEMED> 4,120
<SHARES-REINVESTED> 5,188
<NET-CHANGE-IN-ASSETS> 677,245
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 50,839
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 5,460
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 9,938
<AVERAGE-NET-ASSETS> 523,249
<PER-SHARE-NAV-BEGIN> 22.84
<PER-SHARE-NII> (0.11)
<PER-SHARE-GAIN-APPREC> 4.66
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 5.18
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 22.21
<EXPENSE-RATIO> 1.82
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 012
<NAME> IDEX GROWTH/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 816,965
<INVESTMENTS-AT-VALUE> 1,173,250
<RECEIVABLES> 2,051
<ASSETS-OTHER> 527
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,175,828
<PAYABLE-FOR-SECURITIES> 4,600
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,456
<TOTAL-LIABILITIES> 7,056
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 806,354
<SHARES-COMMON-STOCK> 208
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> (44)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 5,735
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 356,727
<NET-ASSETS> 1,168,772
<DIVIDEND-INCOME> 3,170
<INTEREST-INCOME> 5,513
<OTHER-INCOME> 0
<EXPENSES-NET> 9,880
<NET-INVESTMENT-INCOME> (1,197)
<REALIZED-GAINS-CURRENT> 71,706
<APPREC-INCREASE-CURRENT> 223,454
<NET-CHANGE-FROM-OPS> 293,963
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 116,218
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 193
<NUMBER-OF-SHARES-REDEEMED> 19
<SHARES-REINVESTED> 4
<NET-CHANGE-IN-ASSETS> 677,245
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 50,839
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 5,460
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 9,938
<AVERAGE-NET-ASSETS> 1,645
<PER-SHARE-NAV-BEGIN> 22.64
<PER-SHARE-NII> (0.27)
<PER-SHARE-GAIN-APPREC> 4.66
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 5.18
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.85
<EXPENSE-RATIO> 2.45
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 013
<NAME> IDEX GROWTH/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 816,965
<INVESTMENTS-AT-VALUE> 1,173,250
<RECEIVABLES> 2,051
<ASSETS-OTHER> 527
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,175,828
<PAYABLE-FOR-SECURITIES> 4,600
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,456
<TOTAL-LIABILITIES> 7,056
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 806,354
<SHARES-COMMON-STOCK> 510
<SHARES-COMMON-PRIOR> 247
<ACCUMULATED-NII-CURRENT> (44)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 5,735
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 356,727
<NET-ASSETS> 1,168,772
<DIVIDEND-INCOME> 3,170
<INTEREST-INCOME> 5,513
<OTHER-INCOME> 0
<EXPENSES-NET> 9,880
<NET-INVESTMENT-INCOME> (1,197)
<REALIZED-GAINS-CURRENT> 71,706
<APPREC-INCREASE-CURRENT> 223,454
<NET-CHANGE-FROM-OPS> 293,963
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 116,218
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 463
<NUMBER-OF-SHARES-REDEEMED> 284
<SHARES-REINVESTED> 84
<NET-CHANGE-IN-ASSETS> 677,245
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 50,839
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 5,460
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 9,938
<AVERAGE-NET-ASSETS> 8,058
<PER-SHARE-NAV-BEGIN> 22.64
<PER-SHARE-NII> (0.21)
<PER-SHARE-GAIN-APPREC> 4.66
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 5.18
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.91
<EXPENSE-RATIO> 2.33
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 014
<NAME> IDEX GROWTH/CLASS T
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 816,965
<INVESTMENTS-AT-VALUE> 1,173,250
<RECEIVABLES> 2,051
<ASSETS-OTHER> 527
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,175,828
<PAYABLE-FOR-SECURITIES> 4,600
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,456
<TOTAL-LIABILITIES> 7,056
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 806,354
<SHARES-COMMON-STOCK> 26,132
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> (44)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 5,735
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 356,727
<NET-ASSETS> 1,168,772
<DIVIDEND-INCOME> 3,170
<INTEREST-INCOME> 5,513
<OTHER-INCOME> 0
<EXPENSES-NET> 9,880
<NET-INVESTMENT-INCOME> (1,197)
<REALIZED-GAINS-CURRENT> 71,706
<APPREC-INCREASE-CURRENT> 223,454
<NET-CHANGE-FROM-OPS> 293,964
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 116,218
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 26,247
<NUMBER-OF-SHARES-REDEEMED> 115
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 677,245
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 50,839
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 5,460
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 9,938
<AVERAGE-NET-ASSETS> 585,237
<PER-SHARE-NAV-BEGIN> 22.23
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0.18
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 22.41
<EXPENSE-RATIO> 1.17
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX C.A.S.E. GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 111
<NAME> IDEX C.A.S.E./CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 2,838
<INVESTMENTS-AT-VALUE> 2,941
<RECEIVABLES> 210
<ASSETS-OTHER> 26
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,177
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 9
<TOTAL-LIABILITIES> 9
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,080
<SHARES-COMMON-STOCK> 139
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 175
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (190)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 103
<NET-ASSETS> 3,168
<DIVIDEND-INCOME> 221
<INTEREST-INCOME> 13
<OTHER-INCOME> 0
<EXPENSES-NET> 59
<NET-INVESTMENT-INCOME> 175
<REALIZED-GAINS-CURRENT> (190)
<APPREC-INCREASE-CURRENT> 102
<NET-CHANGE-FROM-OPS> 87
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 151
<NUMBER-OF-SHARES-REDEEMED> 12
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 3,168
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 18
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 59
<AVERAGE-NET-ASSETS> 936
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> 0.61
<PER-SHARE-GAIN-APPREC> (0.15)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.46
<EXPENSE-RATIO> 2.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX C.A.S.E. GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 112
<NAME> IDEX C.A.S.E./CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 2,838
<INVESTMENTS-AT-VALUE> 2,941
<RECEIVABLES> 210
<ASSETS-OTHER> 26
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,177
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 9
<TOTAL-LIABILITIES> 9
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,080
<SHARES-COMMON-STOCK> 106
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 175
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (190)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 103
<NET-ASSETS> 3,168
<DIVIDEND-INCOME> 221
<INTEREST-INCOME> 13
<OTHER-INCOME> 0
<EXPENSES-NET> 59
<NET-INVESTMENT-INCOME> 175
<REALIZED-GAINS-CURRENT> (190)
<APPREC-INCREASE-CURRENT> 120
<NET-CHANGE-FROM-OPS> 87
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 113
<NUMBER-OF-SHARES-REDEEMED> 7
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 3,168
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 18
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 59
<AVERAGE-NET-ASSETS> 596
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> 0.56
<PER-SHARE-GAIN-APPREC> (0.15)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.41
<EXPENSE-RATIO> 3.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX II C.A.S.E GROWTH FOR THE PERIOD ENDED SEPTEMBER 30, 1996,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 113
<NAME> IDEX C.A.S.E./CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 2,838
<INVESTMENTS-AT-VALUE> 2,941
<RECEIVABLES> 210
<ASSETS-OTHER> 26
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,176
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 9
<TOTAL-LIABILITIES> 9
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,080
<SHARES-COMMON-STOCK> 59
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 175
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (190)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 103
<NET-ASSETS> 3,168
<DIVIDEND-INCOME> 221
<INTEREST-INCOME> 13
<OTHER-INCOME> 0
<EXPENSES-NET> 59
<NET-INVESTMENT-INCOME> 175
<REALIZED-GAINS-CURRENT> (190)
<APPREC-INCREASE-CURRENT> 102
<NET-CHANGE-FROM-OPS> 87
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 286
<NUMBER-OF-SHARES-REDEEMED> 227
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 3,168
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 18
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 59
<AVERAGE-NET-ASSETS> 1,205
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> 0.57
<PER-SHARE-GAIN-APPREC> (0.15)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.42
<EXPENSE-RATIO> 3.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX II TACTICAL ASSET ALLOCATION FOR THE PERIOD ENDED SEPTEMBER
30, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 101
<NAME> IDEX TACTICAL ASSET ALLOCATION/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 16,137
<INVESTMENTS-AT-VALUE> 16,623
<RECEIVABLES> 426
<ASSETS-OTHER> 1
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 17,050
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 160
<TOTAL-LIABILITIES> 160
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 16,355
<SHARES-COMMON-STOCK> 671
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 1
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 48
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 486
<NET-ASSETS> 16,890
<DIVIDEND-INCOME> 80
<INTEREST-INCOME> 213
<OTHER-INCOME> 0
<EXPENSES-NET> 262
<NET-INVESTMENT-INCOME> 31
<REALIZED-GAINS-CURRENT> 48
<APPREC-INCREASE-CURRENT> 486
<NET-CHANGE-FROM-OPS> 565
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 26
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 728
<NUMBER-OF-SHARES-REDEEMED> 59
<SHARES-REINVESTED> 2
<NET-CHANGE-IN-ASSETS> 16,890
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 82
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 262
<AVERAGE-NET-ASSETS> 3,474
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> 0.17
<PER-SHARE-GAIN-APPREC> 0.94
<PER-SHARE-DIVIDEND> 0.08
<PER-SHARE-DISTRIBUTIONS> 0.08
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.03
<EXPENSE-RATIO> 2.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX II TACTICAL ASSET ALLOCATION FOR THE PERIOD ENDED SEPTEMBER
30, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 102
<NAME> IDEX TACTICAL ASSET ALLOCATION/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 16,137
<INVESTMENTS-AT-VALUE> 16,623
<RECEIVABLES> 426
<ASSETS-OTHER> 1
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 17,050
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 160
<TOTAL-LIABILITIES> 160
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 16,355
<SHARES-COMMON-STOCK> 440
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 1
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 48
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 486
<NET-ASSETS> 16,890
<DIVIDEND-INCOME> 80
<INTEREST-INCOME> 213
<OTHER-INCOME> 0
<EXPENSES-NET> 262
<NET-INVESTMENT-INCOME> 31
<REALIZED-GAINS-CURRENT> 48
<APPREC-INCREASE-CURRENT> 486
<NET-CHANGE-FROM-OPS> 565
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 493
<NUMBER-OF-SHARES-REDEEMED> 53
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 16,890
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 82
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 262
<AVERAGE-NET-ASSETS> 2,253
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> 0.09
<PER-SHARE-GAIN-APPREC> 0.94
<PER-SHARE-DIVIDEND> 0.01
<PER-SHARE-DISTRIBUTIONS> 0.01
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.02
<EXPENSE-RATIO> 3.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX II TACTICAL ASSET ALLOCATION FOR THE PERIOD ENDED SEPTEMBER
30, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 103
<NAME> IDEX TACTICAL ASSET ALLOCATION/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 16,137
<INVESTMENTS-AT-VALUE> 16,623
<RECEIVABLES> 426
<ASSETS-OTHER> 1
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 17,050
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 160
<TOTAL-LIABILITIES> 160
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 16,355
<SHARES-COMMON-STOCK> 421
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 1
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 48
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 486
<NET-ASSETS> 16,890
<DIVIDEND-INCOME> 80
<INTEREST-INCOME> 213
<OTHER-INCOME> 0
<EXPENSES-NET> 262
<NET-INVESTMENT-INCOME> 31
<REALIZED-GAINS-CURRENT> 48
<APPREC-INCREASE-CURRENT> 486
<NET-CHANGE-FROM-OPS> 565
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 3
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 743
<NUMBER-OF-SHARES-REDEEMED> 322
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 16,890
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 82
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 262
<AVERAGE-NET-ASSETS> 2,472
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> 0.11
<PER-SHARE-GAIN-APPREC> 0.94
<PER-SHARE-DIVIDEND> 0.02
<PER-SHARE-DISTRIBUTIONS> 0.02
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.03
<EXPENSE-RATIO> 3.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX EQUITY-INCOME FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 081
<NAME> IDEX EQUITY-INCOME/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 13,282
<INVESTMENTS-AT-VALUE> 14,480
<RECEIVABLES> 243
<ASSETS-OTHER> 102
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 14,825
<PAYABLE-FOR-SECURITIES> 199
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 47
<TOTAL-LIABILITIES> 246
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 13,025
<SHARES-COMMON-STOCK> 853
<SHARES-COMMON-PRIOR> 440
<ACCUMULATED-NII-CURRENT> 17
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 339
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,198
<NET-ASSETS> 14,579
<DIVIDEND-INCOME> 172
<INTEREST-INCOME> 165
<OTHER-INCOME> 0
<EXPENSES-NET> 184
<NET-INVESTMENT-INCOME> 153
<REALIZED-GAINS-CURRENT> 346
<APPREC-INCREASE-CURRENT> 810
<NET-CHANGE-FROM-OPS> 1,309
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 117
<DISTRIBUTIONS-OF-GAINS> 85
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 538
<NUMBER-OF-SHARES-REDEEMED> 140
<SHARES-REINVESTED> 15
<NET-CHANGE-IN-ASSETS> 9,131
<ACCUMULATED-NII-PRIOR> (4)
<ACCUMULATED-GAINS-PRIOR> 78
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 98
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 190
<AVERAGE-NET-ASSETS> 8,143
<PER-SHARE-NAV-BEGIN> 11.74
<PER-SHARE-NII> 0.57
<PER-SHARE-GAIN-APPREC> 1.28
<PER-SHARE-DIVIDEND> 0.17
<PER-SHARE-DISTRIBUTIONS> 0.32
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.27
<EXPENSE-RATIO> 1.79
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX EQUITY-INCOME FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 082
<NAME> IDEX EQUITY-INCOME/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 13,282
<INVESTMENTS-AT-VALUE> 14,480
<RECEIVABLES> 243
<ASSETS-OTHER> 102
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 14,825
<PAYABLE-FOR-SECURITIES> 199
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 47
<TOTAL-LIABILITIES> 246
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 13,025
<SHARES-COMMON-STOCK> 116
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 17
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 339
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,198
<NET-ASSETS> 14,579
<DIVIDEND-INCOME> 172
<INTEREST-INCOME> 165
<OTHER-INCOME> 0
<EXPENSES-NET> 184
<NET-INVESTMENT-INCOME> 153
<REALIZED-GAINS-CURRENT> 346
<APPREC-INCREASE-CURRENT> 810
<NET-CHANGE-FROM-OPS> 1,309
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 6
<DISTRIBUTIONS-OF-GAINS> 85
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 118
<NUMBER-OF-SHARES-REDEEMED> 3
<SHARES-REINVESTED> 1
<NET-CHANGE-IN-ASSETS> 9,131
<ACCUMULATED-NII-PRIOR> (4)
<ACCUMULATED-GAINS-PRIOR> 78
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 98
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 190
<AVERAGE-NET-ASSETS> 667
<PER-SHARE-NAV-BEGIN> 11.73
<PER-SHARE-NII> 0.50
<PER-SHARE-GAIN-APPREC> 1.28
<PER-SHARE-DIVIDEND> 0.09
<PER-SHARE-DISTRIBUTIONS> 0.24
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.27
<EXPENSE-RATIO> 2.44
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX EQUITY-INCOME FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 083
<NAME> IDEX EQUITY-INCOME/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 13,282
<INVESTMENTS-AT-VALUE> 14,480
<RECEIVABLES> 243
<ASSETS-OTHER> 102
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 14,825
<PAYABLE-FOR-SECURITIES> 199
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 47
<TOTAL-LIABILITIES> 246
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 13,025
<SHARES-COMMON-STOCK> 130
<SHARES-COMMON-PRIOR> 24
<ACCUMULATED-NII-CURRENT> 17
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 339
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,198
<NET-ASSETS> 14,579
<DIVIDEND-INCOME> 172
<INTEREST-INCOME> 165
<OTHER-INCOME> 0
<EXPENSES-NET> 184
<NET-INVESTMENT-INCOME> 153
<REALIZED-GAINS-CURRENT> 346
<APPREC-INCREASE-CURRENT> 810
<NET-CHANGE-FROM-OPS> 1,309
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 9
<DISTRIBUTIONS-OF-GAINS> 85
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 130
<NUMBER-OF-SHARES-REDEEMED> 25
<SHARES-REINVESTED> 1
<NET-CHANGE-IN-ASSETS> 9,131
<ACCUMULATED-NII-PRIOR> (4)
<ACCUMULATED-GAINS-PRIOR> 78
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 98
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 190
<AVERAGE-NET-ASSETS> 957
<PER-SHARE-NAV-BEGIN> 11.73
<PER-SHARE-NII> 0.52
<PER-SHARE-GAIN-APPREC> 1.28
<PER-SHARE-DIVIDEND> 0.11
<PER-SHARE-DISTRIBUTIONS> 0.26
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.27
<EXPENSE-RATIO> 2.34
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX BALANCED FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 091
<NAME> IDEX BALANCED/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 9,059
<INVESTMENTS-AT-VALUE> 9,701
<RECEIVABLES> 572
<ASSETS-OTHER> 15
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 10,288
<PAYABLE-FOR-SECURITIES> 562
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 40
<TOTAL-LIABILITIES> 602
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 7,755
<SHARES-COMMON-STOCK> 598
<SHARES-COMMON-PRIOR> 320
<ACCUMULATED-NII-CURRENT> 8
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,283
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 640
<NET-ASSETS> 9,686
<DIVIDEND-INCOME> 71
<INTEREST-INCOME> 243
<OTHER-INCOME> 0
<EXPENSES-NET> 171
<NET-INVESTMENT-INCOME> 143
<REALIZED-GAINS-CURRENT> 1,308
<APPREC-INCREASE-CURRENT> 212
<NET-CHANGE-FROM-OPS> 1,663
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 105
<DISTRIBUTIONS-OF-GAINS> 178
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 330
<NUMBER-OF-SHARES-REDEEMED> 68
<SHARES-REINVESTED> 16
<NET-CHANGE-IN-ASSETS> 2,651
<ACCUMULATED-NII-PRIOR> (1)
<ACCUMULATED-GAINS-PRIOR> 150
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 84
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 171
<AVERAGE-NET-ASSETS> 5,808
<PER-SHARE-NAV-BEGIN> 11.47
<PER-SHARE-NII> 0.72
<PER-SHARE-GAIN-APPREC> 1.77
<PER-SHARE-DIVIDEND> 0.21
<PER-SHARE-DISTRIBUTIONS> 0.28
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.47
<EXPENSE-RATIO> 1.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX BALANCED FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 092
<NAME> IDEX BALANCED/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 9,059
<INVESTMENTS-AT-VALUE> 9,701
<RECEIVABLES> 572
<ASSETS-OTHER> 15
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 10,288
<PAYABLE-FOR-SECURITIES> 562
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 40
<TOTAL-LIABILITIES> 602
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 7,755
<SHARES-COMMON-STOCK> 51
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 8
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,283
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 640
<NET-ASSETS> 9,686
<DIVIDEND-INCOME> 71
<INTEREST-INCOME> 243
<OTHER-INCOME> 0
<EXPENSES-NET> 171
<NET-INVESTMENT-INCOME> 143
<REALIZED-GAINS-CURRENT> 1,308
<APPREC-INCREASE-CURRENT> 212
<NET-CHANGE-FROM-OPS> 1,663
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4
<DISTRIBUTIONS-OF-GAINS> 178
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 53
<NUMBER-OF-SHARES-REDEEMED> 3
<SHARES-REINVESTED> 1
<NET-CHANGE-IN-ASSETS> 2,651
<ACCUMULATED-NII-PRIOR> (1)
<ACCUMULATED-GAINS-PRIOR> 150
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 84
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 171
<AVERAGE-NET-ASSETS> 262
<PER-SHARE-NAV-BEGIN> 11.47
<PER-SHARE-NII> 0.63
<PER-SHARE-GAIN-APPREC> 1.77
<PER-SHARE-DIVIDEND> 0.13
<PER-SHARE-DISTRIBUTIONS> 0.41
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.46
<EXPENSE-RATIO> 2.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
TATEMENTS OF IDEX BALANCED FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 093
<NAME> IDEX BALANCED/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 9,059
<INVESTMENTS-AT-VALUE> 9,701
<RECEIVABLES> 572
<ASSETS-OTHER> 15
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 10,288
<PAYABLE-FOR-SECURITIES> 562
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 40
<TOTAL-LIABILITIES> 602
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 7,755
<SHARES-COMMON-STOCK> 70
<SHARES-COMMON-PRIOR> 293
<ACCUMULATED-NII-CURRENT> 8
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,283
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 640
<NET-ASSETS> 9,686
<DIVIDEND-INCOME> 71
<INTEREST-INCOME> 243
<OTHER-INCOME> 0
<EXPENSES-NET> 171
<NET-INVESTMENT-INCOME> 143
<REALIZED-GAINS-CURRENT> 1,308
<APPREC-INCREASE-CURRENT> 212
<NET-CHANGE-FROM-OPS> 1,663
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 22
<DISTRIBUTIONS-OF-GAINS> 178
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 63
<NUMBER-OF-SHARES-REDEEMED> 294
<SHARES-REINVESTED> 8
<NET-CHANGE-IN-ASSETS> 2,651
<ACCUMULATED-NII-PRIOR> (1)
<ACCUMULATED-GAINS-PRIOR> 150
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 84
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 171
<AVERAGE-NET-ASSETS> 2,375
<PER-SHARE-NAV-BEGIN> 11.47
<PER-SHARE-NII> 0.64
<PER-SHARE-GAIN-APPREC> 1.77
<PER-SHARE-DIVIDEND> 0.14
<PER-SHARE-DISTRIBUTIONS> 0.42
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.46
<EXPENSE-RATIO> 2.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX FLEXIBLE INCOME FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 051
<NAME> IDEX FLEXIBLE INCOME/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 18,019
<INVESTMENTS-AT-VALUE> 18,153
<RECEIVABLES> 910
<ASSETS-OTHER> 5
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 19,068
<PAYABLE-FOR-SECURITIES> 500
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 126
<TOTAL-LIABILITIES> 626
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 21,060
<SHARES-COMMON-STOCK> 1,858
<SHARES-COMMON-PRIOR> 2,158
<ACCUMULATED-NII-CURRENT> 55
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (2,798)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 125
<NET-ASSETS> 18,442
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,610
<OTHER-INCOME> 0
<EXPENSES-NET> 365
<NET-INVESTMENT-INCOME> 1,245
<REALIZED-GAINS-CURRENT> 718
<APPREC-INCREASE-CURRENT> (710)
<NET-CHANGE-FROM-OPS> 1,253
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,143
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 204
<NUMBER-OF-SHARES-REDEEMED> 598
<SHARES-REINVESTED> 94
<NET-CHANGE-IN-ASSETS> (1,902)
<ACCUMULATED-NII-PRIOR> 22
<ACCUMULATED-GAINS-PRIOR> (3,512)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 174
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 365
<AVERAGE-NET-ASSETS> 18,296
<PER-SHARE-NAV-BEGIN> 9.17
<PER-SHARE-NII> 2.23
<PER-SHARE-GAIN-APPREC> (1.63)
<PER-SHARE-DIVIDEND> 0.58
<PER-SHARE-DISTRIBUTIONS> 0.58
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.19
<EXPENSE-RATIO> 1.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX FLEXIBLE INCOME FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 052
<NAME> IDEX FLEXIBLE INCOME/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 18,019
<INVESTMENTS-AT-VALUE> 18,153
<RECEIVABLES> 910
<ASSETS-OTHER> 5
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 19,068
<PAYABLE-FOR-SECURITIES> 50
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 126
<TOTAL-LIABILITIES> 626
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 21,060
<SHARES-COMMON-STOCK> 54
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 55
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (2,798)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 125
<NET-ASSETS> 18,442
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,610
<OTHER-INCOME> 0
<EXPENSES-NET> 365
<NET-INVESTMENT-INCOME> 1,245
<REALIZED-GAINS-CURRENT> 718
<APPREC-INCREASE-CURRENT> (710)
<NET-CHANGE-FROM-OPS> 1,253
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 14
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 59
<NUMBER-OF-SHARES-REDEEMED> 6
<SHARES-REINVESTED> 1
<NET-CHANGE-IN-ASSETS> (1,902)
<ACCUMULATED-NII-PRIOR> 22
<ACCUMULATED-GAINS-PRIOR> (3,512)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 174
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 365
<AVERAGE-NET-ASSETS> 227
<PER-SHARE-NAV-BEGIN> 9.17
<PER-SHARE-NII> 2.16
<PER-SHARE-GAIN-APPREC> (1.63)
<PER-SHARE-DIVIDEND> 0.52
<PER-SHARE-DISTRIBUTIONS> 0.52
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.18
<EXPENSE-RATIO> 2.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX FLEXIBLE INCOME FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 053
<NAME> IDEX FLEXIBLE INCOME/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 18,019
<INVESTMENTS-AT-VALUE> 18,153
<RECEIVABLES> 910
<ASSETS-OTHER> 5
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 19,068
<PAYABLE-FOR-SECURITIES> 500
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 126
<TOTAL-LIABILITIES> 626
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 21,060
<SHARES-COMMON-STOCK> 96
<SHARES-COMMON-PRIOR> 61
<ACCUMULATED-NII-CURRENT> 55
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (2,798)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 125
<NET-ASSETS> 18,442
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,610
<OTHER-INCOME> 0
<EXPENSES-NET> 365
<NET-INVESTMENT-INCOME> 1,245
<REALIZED-GAINS-CURRENT> 718
<APPREC-INCREASE-CURRENT> (710)
<NET-CHANGE-FROM-OPS> 1,253
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 50
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 71
<NUMBER-OF-SHARES-REDEEMED> 41
<SHARES-REINVESTED> 5
<NET-CHANGE-IN-ASSETS> (1902)
<ACCUMULATED-NII-PRIOR> 22
<ACCUMULATED-GAINS-PRIOR> (3,512)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 174
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 365
<AVERAGE-NET-ASSETS> 860
<PER-SHARE-NAV-BEGIN> 9.17
<PER-SHARE-NII> 2.17
<PER-SHARE-GAIN-APPREC> (1.63)
<PER-SHARE-DIVIDEND> 0.53
<PER-SHARE-DISTRIBUTIONS> 0.53
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.18
<EXPENSE-RATIO> 2.40
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM
THE FINANCIAL STATEMENTS OF IDEX INCOME PLUS FOR THE PERIOD ENDED SEPTEMBER 30,
1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 031
<NAME> IDEX INCOME PLUS/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 66,002
<INVESTMENTS-AT-VALUE> 66,973
<RECEIVABLES> 2,470
<ASSETS-OTHER> 1
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 69,444
<PAYABLE-FOR-SECURITIES> 600
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 134
<TOTAL-LIABILITIES> 734
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 67,165
<SHARES-COMMON-STOCK> 6,271
<SHARES-COMMON-PRIOR> 6,638
<ACCUMULATED-NII-CURRENT> 332
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 248
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 970
<NET-ASSETS> 68,710
<DIVIDEND-INCOME> 86
<INTEREST-INCOME> 5,573
<OTHER-INCOME> 0
<EXPENSES-NET> 921
<NET-INVESTMENT-INCOME> 4,738
<REALIZED-GAINS-CURRENT> 782
<APPREC-INCREASE-CURRENT> (491)
<NET-CHANGE-FROM-OPS> 5,029
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4,531
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 567
<NUMBER-OF-SHARES-REDEEMED> 1,244
<SHARES-REINVESTED> 310
<NET-CHANGE-IN-ASSETS> (2,016)
<ACCUMULATED-NII-PRIOR> 158
<ACCUMULATED-GAINS-PRIOR> (381)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 414
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 934
<AVERAGE-NET-ASSETS> 65,974
<PER-SHARE-NAV-BEGIN> 10.36
<PER-SHARE-NII> 2.72
<PER-SHARE-GAIN-APPREC> (1.96)
<PER-SHARE-DIVIDEND> 0.71
<PER-SHARE-DISTRIBUTIONS> 0.71
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.41
<EXPENSE-RATIO> 1.31
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF IDEX INCOME PLUS FOR THE
PERIOD ENDED SEPTEMBER 30, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 032
<NAME> IDEX INCOME PLUS/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 66,002
<INVESTMENTS-AT-VALUE> 66,973
<RECEIVABLES> 2,470
<ASSETS-OTHER> 1
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 69,444
<PAYABLE-FOR-SECURITIES> 600
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 134
<TOTAL-LIABILITIES> 734
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 67,165
<SHARES-COMMON-STOCK> 74
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 332
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 248
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 970
<NET-ASSETS> 68,710
<DIVIDEND-INCOME> 86
<INTEREST-INCOME> 5,573
<OTHER-INCOME> 0
<EXPENSES-NET> 921
<NET-INVESTMENT-INCOME> 4,738
<REALIZED-GAINS-CURRENT> 782
<APPREC-INCREASE-CURRENT> (491)
<NET-CHANGE-FROM-OPS> 5,029
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 29
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 91
<NUMBER-OF-SHARES-REDEEMED> 19
<SHARES-REINVESTED> 2
<NET-CHANGE-IN-ASSETS> (2,016)
<ACCUMULATED-NII-PRIOR> 158
<ACCUMULATED-GAINS-PRIOR> (381)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 414
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 934
<AVERAGE-NET-ASSETS> 466
<PER-SHARE-NAV-BEGIN> 10.35
<PER-SHARE-NII> 2.65
<PER-SHARE-GAIN-APPREC> (1.96)
<PER-SHARE-DIVIDEND> 0.64
<PER-SHARE-DISTRIBUTIONS> 0.64
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.40
<EXPENSE-RATIO> 1.96
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX INCOME PLUS FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 033
<NAME> IDEX INCOME PLUS/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 66,002
<INVESTMENTS-AT-VALUE> 66,973
<RECEIVABLES> 2,470
<ASSETS-OTHER> 1
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 69,444
<PAYABLE-FOR-SECURITIES> 600
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 134
<TOTAL-LIABILITIES> 734
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 67,165
<SHARES-COMMON-STOCK> 258
<SHARES-COMMON-PRIOR> 191
<ACCUMULATED-NII-CURRENT> 332
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 248
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 970
<NET-ASSETS> 68,710
<DIVIDEND-INCOME> 86
<INTEREST-INCOME> 5,573
<OTHER-INCOME> 0
<EXPENSES-NET> 921
<NET-INVESTMENT-INCOME> 4,738
<REALIZED-GAINS-CURRENT> 782
<APPREC-INCREASE-CURRENT> (491)
<NET-CHANGE-FROM-OPS> 5,029
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 162
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 150
<NUMBER-OF-SHARES-REDEEMED> 95
<SHARES-REINVESTED> 12
<NET-CHANGE-IN-ASSETS> (2,016)
<ACCUMULATED-NII-PRIOR> 158
<ACCUMULATED-GAINS-PRIOR> (381)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 414
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 934
<AVERAGE-NET-ASSETS> 2,563
<PER-SHARE-NAV-BEGIN> 10.35
<PER-SHARE-NII> 2.66
<PER-SHARE-GAIN-APPREC> (1.96)
<PER-SHARE-DIVIDEND> 0.65
<PER-SHARE-DISTRIBUTIONS> 0.65
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.40
<EXPENSE-RATIO> 1.86
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX TAX EXEMPT FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 021
<NAME> IDEX TAX EXEMPT/CLASS A
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLAR
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 24,283
<INVESTMENTS-AT-VALUE> 24,503
<RECEIVABLES> 1,593
<ASSETS-OTHER> 775
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 26,871
<PAYABLE-FOR-SECURITIES> 997
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 70
<TOTAL-LIABILITIES> 1,067
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 25,361
<SHARES-COMMON-STOCK> 2,175
<SHARES-COMMON-PRIOR> 2,416
<ACCUMULATED-NII-CURRENT> 49
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 174
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 220
<NET-ASSETS> 25,804
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,564
<OTHER-INCOME> 0
<EXPENSES-NET> 268
<NET-INVESTMENT-INCOME> 1,296
<REALIZED-GAINS-CURRENT> 222
<APPREC-INCREASE-CURRENT> 3
<NET-CHANGE-FROM-OPS> 1,521
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,284
<DISTRIBUTIONS-OF-GAINS> 64
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 140
<NUMBER-OF-SHARES-REDEEMED> 466
<SHARES-REINVESTED> 85
<NET-CHANGE-IN-ASSETS> (2,051)
<ACCUMULATED-NII-PRIOR> 68
<ACCUMULATED-GAINS-PRIOR> 7
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 160
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 268
<AVERAGE-NET-ASSETS> 25,926
<PER-SHARE-NAV-BEGIN> 11.34
<PER-SHARE-NII> 2.13
<PER-SHARE-GAIN-APPREC> (1.48)
<PER-SHARE-DIVIDEND> 0.56
<PER-SHARE-DISTRIBUTIONS> 0.63
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.36
<EXPENSE-RATIO> 1.00
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX TAX EXEMPT FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 022
<NAME> IDEX TAX EXEMPT/CLASS B
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLAR
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 24,283
<INVESTMENTS-AT-VALUE> 24,503
<RECEIVABLES> 1,593
<ASSETS-OTHER> 775
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 26,871
<PAYABLE-FOR-SECURITIES> 997
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 70
<TOTAL-LIABILITIES> 1,067
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 25,361
<SHARES-COMMON-STOCK> 17
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 49
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 174
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 220
<NET-ASSETS> 25,804
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,564
<OTHER-INCOME> 0
<EXPENSES-NET> 268
<NET-INVESTMENT-INCOME> 1,296
<REALIZED-GAINS-CURRENT> 222
<APPREC-INCREASE-CURRENT> 3
<NET-CHANGE-FROM-OPS> 1,521
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4
<DISTRIBUTIONS-OF-GAINS> 64
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 17
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (2,051)
<ACCUMULATED-NII-PRIOR> 68
<ACCUMULATED-GAINS-PRIOR> 37
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 60
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 268
<AVERAGE-NET-ASSETS> 01
<PER-SHARE-NAV-BEGIN> 11.34
<PER-SHARE-NII> 2.06
<PER-SHARE-GAIN-APPREC> (1.48)
<PER-SHARE-DIVIDEND> 0.49
<PER-SHARE-DISTRIBUTIONS> 0.56
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.36
<EXPENSE-RATIO> 1.65
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF IDEX TAX EXEMPT FOR THE PERIOD ENDED SEPTEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. </LEGEND>
<CIK> 0000787623
<NAME> IDEX SERIES FUND
<SERIES>
<NUMBER> 023
<NAME> IDEX TAX EXEMPT/CLASS C
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLAR
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 24,283
<INVESTMENTS-AT-VALUE> 24,503
<RECEIVABLES> 1,593
<ASSETS-OTHER> 775
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 26,871
<PAYABLE-FOR-SECURITIES> 997
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 70
<TOTAL-LIABILITIES> 1,067
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 25,361
<SHARES-COMMON-STOCK> 80
<SHARES-COMMON-PRIOR> 40
<ACCUMULATED-NII-CURRENT> 49
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 174
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 20
<NET-ASSETS> 25,804
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,564
<OTHER-INCOME> 0
<EXPENSES-NET> 268
<NET-INVESTMENT-INCOME> 1,296
<REALIZED-GAINS-CURRENT> 222
<APPREC-INCREASE-CURRENT> 3
<NET-CHANGE-FROM-OPS> 1,521
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 26
<DISTRIBUTIONS-OF-GAINS> 164
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 66
<NUMBER-OF-SHARES-REDEEMED> 28
<SHARES-REINVESTED> 2
<NET-CHANGE-IN-ASSETS> (2,051)
<ACCUMULATED-NII-PRIOR> 68
<ACCUMULATED-GAINS-PRIOR> 37
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 160
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 268
<AVERAGE-NET-ASSETS> 556
<PER-SHARE-NAV-BEGIN> 11.34
<PER-SHARE-NII> 2.10
<PER-SHARE-GAIN-APPREC> (1.48)
<PER-SHARE-DIVIDEND> 0.53
<PER-SHARE-DISTRIBUTIONS> 0.60
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.36
<EXPENSE-RATIO> 1.25
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<PAGE>
</TABLE>
