Chairman's
Message
Dear Shareholders:
We're pleased to provide this consolidated report for the Phoenix Series
Fund, covering the twelve months ended October 31, 1995.
In addition to the summary of economic and market activity outlined below,
this report includes portfolio commentary and a complete list of investments
for each Phoenix Series Fund.
The Economy and the Markets
The domestic financial markets provided outstanding returns during most of
this fiscal reporting period. On balance, stocks have enjoyed an ideal
investment climate thus far in 1995. Moderate economic growth, low inflation
and better-than-expected corporate earnings have all helped the stock market
reach record highs. Over this twelve-month reporting period, the Standard &
Poor's 500 Index posted an impressive total return of 26.41%.
Bonds, too, have benefited from the economy's moderate pace of growth and
controlled inflation. Over this fiscal period, long-term interest rates have
declined over 170 basis points, pushing bond prices up significantly. The
bond market, as measured by the Lehman Brothers Aggregate Bond Index, gained
15.65% during this twelve-month period.
Outlook
While it is unlikely that 1996 will bring a repeat of the stellar gains we've
seen during 1995, our outlook for financial assets remains positive. As we
approach yearend, the Federal Reserve Board appears to have been successful
in controlling economic growth and inflation. Federal budget problems are a
growing concern at this writing; however, a definitive budget accord in
Washington would be good news for the financial markets as well as the U.S.
dollar. Although the Fed is expected to cut short-term interest rates once
the budget issues have been resolved, we anticipate a more stable
interest-rate environment in the coming year.
While the current interest-rate outlook continues to be a positive factor for
the stock market, we believe corporate earnings growth has peaked. We expect
to see increased market volatility as investors move to protect their gains.
In our view, double-digit returns will be more difficult to attain in 1996
and successful investing will require a highly selective approach to the
equity markets.
On behalf of the Phoenix Funds I want to thank you for investing with us. We
look forward to continuing to serve your investment needs.
Sincerely,
/s/ Philip R. McLoughlin
Philip R. McLoughlin, Chairman
<PAGE>
Table of Contents
Page
Equity Funds
The Balanced Fund Series 1
The Convertible Fund Series 10
The Growth Fund Series 18
The U.S. Stock Fund Series 25
Fixed Income Funds
The High Yield Fund Series 32
The U.S. Government Securities Fund Series 40
The Money Market Fund Series 45
Notes to Financial Statements 50
Fund Features and General Information 54
<PAGE>
BALANCED FUND SERIES
INVESTMENT ADVISER'S REPORT
Phoenix Balanced Fund generated solid total returns for the twelve months
ended October 31, 1995, attributable to a powerful stock market as well as
lower long-term interest rates. For the year ended October 31, 1995, Class A
shares provided a total return of 15.52% and Class B shares returned 14.68%.
As a result of our defensive positioning early in the fiscal year, the Fund
underperformed its balanced benchmark index return of 20.46% for the same
period. All of these figures assume reinvestment of any distributions but
exclude the effect of sales charges.
Over the last twelve months, stocks have benefited considerably from
corporate earnings growth, declining interest rates and mild inflation. In
the equity segment of the portfolio, we diversified our stock selection among
all economic sectors with emphasis on health care, utilities, financials and
technology. The addition of finance and technology during the summer and
utilities in the fall months benefited performance.
During the fiscal year, long-term interest rates declined over 170 basis
points. In the portfolio's fixed-income segment, we have reduced our exposure
to the overvalued treasury market over the last three months while further
diversifying into other attractive sectors of the bond market. Over the
summer months, we also lengthened the average duration of the portfolio to
take advantage of the declining long-term rates.
Looking forward, we are forecasting relatively flat corporate earnings growth
as a whole for 1996. We also expect stable to slightly lower long-term rates
and declining short-term rates by the end of 1996. Therefore, we feel
financial markets are unlikely to continue this year's exceptionally strong
performance in 1996. Currently, we are targeting allocation levels at 50%
equity, 40% fixed income and 10% cash. This allocation is at a normal range,
given the Fund's objectives and our outlook for the various markets.
INVESTOR PROFILE
Phoenix Balanced Fund is best suited for an investor seeking to supplement
current income while maintaining the potential for future growth and the
conservation of capital.
See Notes to Financial Statements
<PAGE>
Balanced Fund Series
==================================[LINE CHART]=================================
Phoenix
Balanced Balanced
Fund-- Benchmark
Class A S&P 500* Index**
1985 9525 10000 10000
1986 12676 13286 12564
1987 14038 14138 13342
1988 14338 16186 15003
1989 17292 20429 17916
1990 18107 18892 17719
1991 22861 25223 22036
1992 25094 27733 24122
1993 27582 31865 27176
1994 26678 33117 27521
1995 30818 41864 33152
Average Annual Total Returns for Periods Ending 10/31/95
From Inception
7/15/94 to
1 Year 5 Years 10 Years 10/31/95
- --------------------------------------------------------------------------------
Class A with 4.75% sales charge 10.03% 10.13% 11.90% --
- --------------------------------------------------------------------------------
Class A at net asset value 15.52% 11.20% 12.44% --
- --------------------------------------------------------------------------------
Class B with CDSC 9.68% -- -- 8.41%
- --------------------------------------------------------------------------------
Class B at net asset value 14.68% -- -- 11.40%
- --------------------------------------------------------------------------------
S&P 500 Index* 26.41% 17.25% 15.40% 26.56%
- --------------------------------------------------------------------------------
Balanced Benchmark** 20.46% 13.35% 12.77% 19.30%
===============================================================================
This chart assumes an initial gross investment of $10,000 made on 10/31/85
for Class A shares. The total return for Class A shares reflects the maximum
sales charge of 4.75% on the initial investment and assumes reinvestment of
dividends and capital gains. Class B share performance will be greater or
less than that shown based on differences in inception date, fees and sales
charges. The total return for Class B shares reflects the 5% contingent
deferred sales charge (CDSC), which is applicable on all shares redeemed
during the 1st year after purchase and 4% for all shares redeemed during the
2nd year after purchase (scaled down to 3%--3rd year; 2%--4th and 5th year
and 0% thereafter.) Returns indicate past performance, which is not
predictive of future performance. Investment return and principal value will
fluctuate, so that your shares, when redeemed, may be worth more or less than
the original cost.
*The S&P 500 Index is an unmanaged but commonly used measure of common stock
total return performance. The S&P 500's performance does not reflect sales
charges.
**The Balanced Benchmark is calculated based upon the performance of the
following indexes: 55% S&P 500/35% Lehman Brothers' Aggregate Bond Index/10%
U.S. Treasury Bills and is produced by Frank Russell Company. The index's
performance does not reflect sales charges.
See Notes to Financial Statements
<PAGE>
INVESTMENTS AT OCTOBER 31, 1995
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
U.S. GOVERNMENT SECURITIES--30.9%
U.S. Treasury Bonds--9.4%
U.S. Treasury Bonds 7.875%, '04 AAA $ 39,000 $ 43,931,550
U.S. Treasury Bonds 6.50%, '05 AAA 4,770 4,938,433
U.S. Treasury Bonds 7.50%, '05 AAA 94,800 104,529,324
U.S. Treasury Bonds 7.50%, '16 AAA 60,000 67,532,400
-----------
220,931,707
-----------
U.S. Treasury Notes--20.0%
U.S. Treasury Notes 4.625%, '96 AAA 54,000 53,845,020
U.S. Treasury Notes 4.75%, '98 AAA 45,000 43,892,550
U.S. Treasury Notes 5.125%, '98 AAA 20,825 20,570,935
U.S. Treasury Notes 7.125%, '98 AAA 12,000 12,458,640
U.S. Treasury Notes 5.875%, '99 AAA 32,000 32,130,240
U.S. Treasury Notes 6.375%, '99 AAA 80,000 81,584,800
U.S. Treasury Notes 7%, '99 AAA 74,900 77,746,200
U.S. Treasury Notes 6.875%, '00 AAA 146,600 152,562,222
-----------
474,790,607
-----------
Agency Mortgage-Backed
Securities--1.5%
GNMA 6.50%, '23-'24 AAA 35,475 34,488,660
-----------
TOTAL U.S. GOVERNMENT SECURITIES
(Identified cost $711,605,756) 730,210,974
-----------
NON-CONVERTIBLE BONDS--1.5%
Non-Agency Mortgage-Backed Securities--1.5%
Lehman Commercial Conduit 95-C2 B
7.18%, '05 (f) AA 6,092 6,195,076
Merrill Lynch Mortgage, Inc.,
95-C2 B 7.53%, '21 AA((d)) 3,397 3,458,833
Resolution Trust Corp. 93-C1, B
8.75%, '24 Aa((d)) 5,675 5,875,398
Resolution Trust Corp. 95-C1, A5
6%, '27 Aaa((d)) 6,707 6,664,629
Resolution Trust Corp. 95-C1, B
6.90%, '27 Aa((d)) 6,900 6,811,594
Resolution Trust Corp. 95-2, M2
7%, '29 Aa((d)) 5,978 5,945,750
-----------
TOTAL NON-CONVERTIBLE BONDS
(Identified cost $34,755,317) 34,951,280
-----------
FOREIGN NON-CONVERTIBLE BONDS--2.0%
Argentina--0.2%
Republic of Argentina Discount
L-GL Euro 6.875%, '23 (f) BB- 5,000 2,821,875
Republic of Argentina Par L-GP 5%,
'23 (f) B 6,000 2,868,750
-----------
5,690,625
-----------
Brazil--0.3%
Republic of Brazil Discount Series
Z-L Euro 6.8125%, '24 (f) NR 5,000 2,981,250
Republic of Brazil Par Z-L Euro
4.25%, '24 (f) NR 6,200 3,010,875
-----------
5,992,125
-----------
Mexico--0.2%
United Mexican Discount B Euro
7.1875%, '19 (e) (f) BB $ 8,500 $ 5,684,375
-----------
Philippines--0.3%
Bank of Philippines PCIR Euro
5.75%, '17 (f) BB 8,000 5,865,000
-----------
Poland--1.0%
Poland Global Reg. Par Euro 2.75%,
'24 (f) NR 54,700 24,204,750
-----------
TOTAL FOREIGN NON-CONVERTIBLE BONDS
(Identified cost $48,324,003) 47,436,875
-----------
MUNICIPAL BONDS--1.7%
California--0.4%
Long Beach, CA Pension Obligation
6.87%, '06 AAA 3,090 3,091,112
N. California Power Agency Rev.
Ser. A 5.50%, '24 AAA 5,555 5,361,186
-----------
8,452,298
-----------
Florida--0.8%
Florida Board of Education Series
E 5.25%, '23 AA 6,060 5,667,676
Miami Beach, FL Spec. Oblig.
Taxable 8.60%, '21 AAA 11,675 12,967,772
-----------
18,635,448
-----------
New York--0.1%
New York State Power Rev. Series
CC 5.25%, '18 AA- 2,780 2,616,647
-----------
South Carolina--0.2%
South Carolina Public Service Rev.
Ser. C 5.125%, '21 A+ 2,225 2,000,119
South Carolina Public Service Ser.
C 5%, '25 AAA 4,620 4,090,964
-----------
6,091,083
-----------
Utah--0.2%
Intermountain Power, Utah Series A
5%, '23 AA- 5,475 4,874,722
-----------
TOTAL MUNICIPAL BONDS
(Identified cost $40,251,378) 40,670,198
-----------
CONVERTIBLE BONDS--2.8%
Airlines--0.5%
Delta Airlines, Inc. Cv. 3.23%,
'03 B+ 14,000 12,285,000
-----------
Computer Software & Services--0.3%
Softkey SDCV 144A 5.50%, '00 (c) NR 9,250 7,816,250
-----------
Professional Services--0.5%
Automatic Data Processing, Inc.
Cv. 0%, '12 AA 25,000 11,625,000
-----------
<PAGE>
Retail--0.6%
Federated Department Stores Cv.
5%, '03 BB- $ 3,800 $ 3,695,500
Staples, Inc. SDCV 144A 4.50%, '00
(c) B+ 10,000 10,300,000
-----------
13,995,500
-----------
Utility--Telephone--0.9%
U.S. West, Inc. Euro Cv. 0%, '11 A 62,000 20,692,500
-----------
TOTAL CONVERTIBLE BONDS
(Identified cost $67,287,247) 66,414,250
-----------
SHARES
CONVERTIBLE PREFERRED STOCKS--1.4%
Computer Software & Services--0.6%
General Motors Corp. $3.25 Cv. Pfd. 200,000 13,400,000
------------
Diversified Financial Services--0.5%
Time Warner Financing $1.24 Cv. Pfd. PERCS 350,000 11,200,000
------------
Telecommunications Equipment--0.3%
MFS Communications Cv. Pfd. 8% DECS 186,000 7,347,000
------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(Identified cost $28,578,477) 31,947,000
------------
COMMON STOCKS--47.1%
Aerospace & Defense--0.6%
Boeing Company 200,000 13,125,000
------------
Banks--3.5%
Bankers Trust New York Corp. 125,900 8,026,125
Barnett Banks, Inc. 100,000 5,525,000
Boatmen's Bancshares, Inc. 200,000 7,600,000
Chase Manhattan Corp. 405,000 23,085,000
Citicorp 250,000 16,218,750
Great Western Financial Corp. 600,000 13,575,000
Signet Banking Corp. 200,000 4,750,000
UJB Financial Corp. 150,000 4,781,250
------------
83,561,125
------------
Chemical--2.5%
IMC Global, Inc. 200,000 14,000,000
Monsanto Co. 250,000 26,187,500
W. R. Grace & Co. 350,000 19,512,500
------------
59,700,000
------------
Computer Software & Services--2.2%
America Online, Inc. (b) 150,000 12,000,000
Computer Sciences Corp. (b) 175,000 11,703,125
Oracle Systems Corp. (b) 450,000 19,631,250
UUNET Technologies, Inc. (b) 150,000 9,112,500
------------
52,446,875
------------
Conglomerates--2.0%
AlliedSignal, Inc. 250,000 10,625,000
ITT Corp. 150,000 18,375,000
Tyco International Ltd. 300,000 18,225,000
------------
47,225,000
------------
SHARES VALUE
Cosmetics & Soaps--1.2%
Procter & Gamble Co. 350,000 $ 28,350,000
------------
Diversified Financial Services--2.6%
American Express Co. 400,000 16,250,000
Dean Witter Discover & Co. 225,000 11,193,750
Merrill Lynch & Company, Inc. 72,000 3,996,000
MGIC Investment Corp. 250,000 14,218,750
Travelers Group, Inc. 325,000 16,412,500
------------
62,071,000
------------
Electrical Equipment--1.2%
General Electric Co. 250,000 15,812,500
Linear Technology Corp. 275,000 12,031,250
------------
27,843,750
------------
Engineering & Construction--0.8%
Fluor Corp. 350,000 19,775,000
------------
Entertainment, Leisure & Gaming--1.6%
Viacom, Inc. Class B (b) 450,000 22,500,000
Walt Disney Co. 250,000 14,406,250
------------
36,906,250
------------
Food--0.5%
Nabisco Holdings Corp. Class A 400,000 10,750,000
------------
Healthcare--Drugs--4.0%
Amgen, Inc. (b) 400,000 19,200,000
Chiron Corp. (b) 155,000 14,105,000
Genzyme Corp. 300,000 17,475,000
Pfizer, Inc. 200,000 11,475,000
Upjohn Co. 425,000 21,568,750
Watson Pharmaceuticals, Inc. (b) 250,000 11,187,500
------------
95,011,250
------------
Hospital Management & Services--1.1%
United Healthcare Corp. 250,000 13,281,250
Vencor, Inc. (b) 455,500 12,640,125
------------
25,921,375
------------
Insurance--2.4%
Aetna Life & Casualty Co. 225,000 15,834,375
American International Group, Inc. 175,000 14,765,625
Cigna Corp. 200,000 19,825,000
SunAmerica, Inc. 100,000 6,225,000
------------
56,650,000
------------
Lodging & Restaurants--1.2%
Boston Chicken (b) 502,000 16,973,875
Starbucks Corp. (b) 300,000 11,775,000
------------
28,748,875
------------
Machinery--0.6%
Case Corp. 350,000 13,343,750
------------
Medical Products & Supplies--0.9%
Baxter International, Inc. 575,000 22,209,375
------------
Office & Business Equipment--0.7%
Sun Microsystems, Inc. (b) 200,000 15,600,000
------------
Oil--1.1%
Chevron Corp. 250,000 11,687,500
Mobil Corp. 150,000 15,112,500
------------
26,800,000
------------
<PAGE>
Oil Service & Equipment--1.2%
Halliburton Co. 400,000 $ 16,600,000
Schlumberger Ltd. 200,000 12,450,000
------------
29,050,000
------------
Paper & Forest Products--0.5%
Kimberly-Clark Corp. 175,000 12,709,375
------------
Professional Services--1.5%
First Data Systems Corp. 200,000 13,225,000
Fritz Cos., Inc. (b) 250,000 8,750,000
Manpower, Inc. 450,000 12,206,250
------------
34,181,250
------------
Retail--1.9%
Federated Department Stores, Inc. (b) 850,000 21,568,750
Office Depot, Inc. (b) 800,000 22,900,000
------------
44,468,750
------------
Retail--Drug--0.5%
General Nutrition Companies, Inc. (b) 500,000 12,437,500
------------
Telecommunications Equipment--2.0%
Bay Networks, Inc. (b) 225,000 14,906,250
cisco Systems, Inc. (b) 175,000 13,562,500
StrataCom, Inc. (b) 175,000 10,762,500
U.S. West Communications Group (b) 310,800 8,896,650
------------
48,127,900
------------
Tobacco--1.1%
Philip Morris Companies, Inc. 300,000 25,350,000
------------
Utility--Electric--4.3%
Allegheny Power Systems, Inc. 500,000 13,187,500
FPL Group, Inc. 300,000 12,562,500
Illinova Corp. 475,000 13,478,125
Pinnacle West Capital Corp. 475,000 13,062,500
Portland General Corp. 500,000 13,562,500
Texas Utilities Co. 375,000 13,781,250
Unicom Corp. 650,000 21,287,500
------------
100,921,875
------------
Utility--Telephone--3.4%
AT&T Corp. 425,000 27,200,000
Ameritech Corp. 300,000 16,200,000
MCI Communications Corp. 800,000 19,950,000
SBC Communications, Inc. 300,000 16,762,500
------------
80,112,500
------------
TOTAL COMMON STOCKS
(Identified cost $1,002,208,150) 1,113,397,775
------------
FOREIGN COMMON STOCKS--1.3%
United Kingdom--0.8%
Healthcare--Diversified--0.8%
Smithkline Beecham PLC ADR 375,000 19,453,125
------------
Netherlands--0.5%
Oil--0.5%
Royal Dutch Petroleum Co. ADR 100,000 12,287,500
------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $29,598,905) 31,740,625
------------
TOTAL LONG-TERM INVESTMENTS--88.7%
(Identified cost $1,962,609,233) 2,096,768,977
------------
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
SHORT-TERM OBLIGATIONS--8.7%
Commercial Paper--6.0%
Emerson Electric 5.70%, 11-1-95 A-1+ $ 16,865 $ 16,865,000
Philip Morris Cos. 5.72%, 11-1-95 A-1 5,000 5,000,000
Goldman Sachs 5.73%, 11-2-95 A-1+ 12,320 12,318,039
E.I. DuPont de Nemours 5.72%,
11-3-95 A-1+ 6,468 6,465,945
McDonald's Corp. 5.70%, 11-3-95 A-1+ 12,300 12,296,105
Pfizer, Inc. 5.70%, 11-3-95 A-1+ 3,519 3,517,886
Unilever Capital Corp. 5.67%,
11-8-95 A-1+ 7,910 7,901,279
Coca Cola Co. 5.71%, 11-10-95 A-1+ 10,000 9,985,725
General Electric Capital Corp.
5.73%, 11-10-95 A-1+ 6,895 6,885,123
Kimberly-Clark 5.70%, 11-10-95 A-1+ 1,505 1,502,855
First Deposit Funding Trust 5.72%,
11-13-95 A-1+ 5,000 4,990,467
Wal-Mart Stores 5.70%, 11-13-95 A-1+ 4,560 4,551,336
Wal-Mart Stores 5.75%, 11-13-95 A-1+ 2,200 2,195,783
Kimberly-Clark Corp. 5.73%,
11-16-95 A-1+ 6,885 6,868,562
H.J. Heinz Co. 5.73%, 11-17-95 A-1 14,970 14,931,876
Wal-Mart Stores 5.70%, 11-17-95 A-1+ 3,280 3,271,691
Warner-Lambert 5.70%, 11-30-95 A-1+ 5,000 4,977,042
Coca Cola Co. 5.68%, 12-11-95 A-1+ 3,500 3,477,911
Minnesota Mining & Manufacturing
5.67%, 12-13-95 A-1+ 3,685 3,660,624
E.I. DuPont de Nemours 5.64%,
2-9-96 A-1+ 5,000 4,919,600
Exxon Imperial U.S. Inc. 5.65%,
2-9-96 A-1+ 5,000 4,919,600
-----------
141,502,449
-----------
<PAGE>
PAR
VALUE
(000) VALUE
Federal Agency Securities--0.8%
Federal Farm Credit Bank 6.33%,
11-1-95 $ 7,000 $ 7,000,000
Federal Home Loan Banks 5.82%,
11-1-95 5,365 5,365,000
Federal Home Loan Banks 5.85%,
11-1-95 7,175 7,175,000
------------
19,540,000
------------
Federal Agency--Variable--1.9%
Student Loan Marketing Assn. 5.60%, 11-9-95 16,500 16,500,000
Student Loan Marketing Assn. 5.65%, 1-11-96 9,500 9,500,000
Federal National Mortgage Assn. 5.55%,
2-16-96 13,000 13,000,000
Student Loan Marketing Assn. 5.80%, 3-20-96 5,000 5,006,250
------------
44,006,250
------------
VALUE
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $205,050,107) $ 205,048,699
-------------
TOTAL INVESTMENTS--97.4%
(Identified cost $2,167,659,340) 2,301,817,676(a)
Cash & receivables, less
liabilities--2.6% 60,593,881
-------------
NET ASSETS--100.0% $2,362,411,557
=============
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $152,402,459 and gross
depreciation of $18,154,694 for income tax purposes. At October 31, 1995,
the aggregate cost of securities for federal income tax purposes was
$2,167,569,911.
(b) Non-income producing.
(c) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At October 31,
1995, these securities amounted to a value of $18,116,250 or 0.8% of net
assets.
(d) As rated by Moody's, Fitch or Duff and Phelps.
(e) Mexico Value Recovery Euro Rights (13,076,000 shares) incorporated as a
unit.
(f) Variable or step coupon bond; interest rate shown reflects the rate
currently in effect.
ADR--American Depository Receipt
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1995
Assets
Investment securities at value
(Identified cost $2,167,659,340) $2,301,817,676
Cash 4,144
Receivables
Investment securities sold 76,423,482
Fund shares sold 1,062,941
Dividends and interest 14,172,726
-----------
Total Assets 2,393,480,969
-----------
Liabilities
Payables
Investment securities purchased 25,396,603
Fund shares repurchased 3,162,875
Investment advisory fee 1,034,490
Financial agent fee 60,473
Transfer agent fee 604,921
Distribution fee 514,583
Trustees' fee 6,185
Accrued expenses 289,282
-----------
Total Liabilities 31,069,412
-----------
Net Assets $2,362,411,557
===========
Net Assets Consist of:
Capital paid in on shares of beneficial interest $2,095,717,933
Undistributed net investment income 8,469,986
Accumulated net realized gains 124,065,302
Net unrealized appreciation 134,158,336
-----------
Net Assets $2,362,411,557
===========
Class A
Shares of beneficial interest outstanding,
$1 par value, unlimited authorization
(Net Assets $2,345,440,478) 137,616,233
Net asset value per share $17.04
Offering price per share
$17.04/(1-4.75%) $17.89
Class B
Shares of beneficial interest outstanding,
$1 par value, unlimited authorization
(Net Assets $16,971,079) 997,494
Net asset value and offering price per share $17.01
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1995
Investment Income
Dividends $ 20,163,910
Interest 83,637,626
----------
Total Investment Income 103,801,536
----------
Expenses
Investment advisory fee 12,384,575
Distribution fee--Class A 6,018,974
Distribution fee--Class B 112,045
Financial agent fee 725,638
Transfer agent 4,495,037
Printing 379,206
Custodian 253,381
Registration 128,094
Professional 72,528
Trustees 16,250
Miscellaneous 158,471
----------
Total Expenses 24,744,199
----------
Net Investment Income 79,057,337
----------
Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain on securities 146,551,737
Net realized loss on foreign currency transactions (885,716)
Net unrealized appreciation on investments 118,762,724
----------
Net gain on investments 264,428,745
----------
Net increase in net assets resulting from operations $343,486,082
==========
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
October 31, October 31,
1995 1994
------------ --------------
From Operations
Net investment income $ 79,057,337 $ 87,250,254
Net realized gain (loss) 145,666,021 (19,567,118)
Net unrealized appreciation
(depreciation) 118,762,724 (168,056,299)
---------- ------------
Increase (decrease) in net assets
resulting from operations 343,486,082 (100,373,163)
---------- ------------
From Distributions to Shareholders
Net investment income--Class A (77,388,590) (89,537,401)
Net investment income--Class B (288,920) (17,100)
Net realized gains--Class A -- (72,968,988)
---------- ------------
Decrease in net assets from distributions
to shareholders (77,677,510) (162,523,489)
---------- ------------
From Share Transactions
Class A
Proceeds from sales of shares (12,302,449
and 26,264,536 shares, respectively) 194,015,940 413,622,592
Net asset value of shares issued from
reinvestment of distributions
(4,436,794 and 9,219,394 shares,
respectively) 70,169,584 145,320,869
Cost of shares repurchased (49,930,419
and 52,564,857 shares, respectively) (784,885,316) (820,252,365)
---------- ------------
Total (520,699,792) (261,308,904)
---------- ------------
Class B
Proceeds from sales of shares (769,217
and 308,090 shares, respectively) 12,085,660 4,693,331
Net asset value of shares issued from
reinvestment of distributions
(16,234 and 1,035 shares, respectively) 261,080 15,630
Cost of shares repurchased (91,818 and
5,264 shares, respectively) (1,481,587) (79,998)
---------- ------------
Total 10,865,153 4,628,963
---------- ------------
Decrease in net assets from share
transactions (509,834,639) (256,679,941)
---------- ------------
Net decrease in net assets (244,026,067) (519,576,593)
Net Assets
Beginning of period 2,606,437,624 3,126,014,217
---------- ------------
End of period (including undistributed
net investment income of $8,469,986 and
$8,294,783, respectively) $2,362,411,557 $2,606,437,624
========== ============
<PAGE>
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
Class A
-----------------------------------------------------
Year Ended October 31,
1995 1994 1993 1992 1991
------- ------- ------- ------- ---------
Net asset value,
beginning of
period $15.23 $16.64 $15.92 $16.05 $13.86
Income from
investment
operations
Net investment
income 0.52 0.48 0.46 0.52 0.62
Net realized and
unrealized gain
(loss) 1.80 (1.01) 1.08 0.92 2.84
------ ------ ------ ------ -------
Total from
investment
operations 2.32 (0.53) 1.54 1.44 3.46
------ ------ ------ ------ -------
Less distributions
Dividends from net
investment income (0.51) (0.49) (0.46) (0.54) (0.64)
Dividends from net
realized gains -- (0.39) (0.36) (1.03) (0.63)
------ ------ ------ ------ -------
Total
distributions (0.51) (0.88) (0.82) (1.57) (1.27)
------ ------ ------ ------ -------
Change in net asset
value 1.81 (1.41) 0.72 (0.13) 2.19
------ ------ ------ ------ -------
Net asset value,
end of period $17.04 $15.23 $16.64 $15.92 $16.05
====== ====== ====== ====== =======
Total return((1)) 15.52% -3.28% 9.92% 9.77% 26.26%
Ratios/supplemental
data:
Net assets, end of
period
(thousands) $2,345,440 $2,601,808 $3,126,014 $2,146,726 $941,754
Ratio to average
net assets of:
Operating
expenses 1.02% 0.96% 0.95% 0.98% 0.98%
Net investment
income 3.27% 3.03% 2.88% 3.55% 4.22%
Portfolio turnover 197% 159% 130% 136% 196%
Class B
---------------------------
Year From
Ended Inception
October 31, 7/15/94 to
1995 10/31/94
----------- -------------
Net asset value,
beginning of
period $15.23 $15.27
Income from
investment
operations
Net investment
income 0.40 0.09
Net realized and
unrealized gain
(loss) 1.80 (0.04)
--------- -----------
Total from
investment
operations 2.20 0.05
--------- -----------
Less distributions
Dividends from net
investment income (0.42) (0.09)
Dividends from net
realized gains -- --
--------- -----------
Total
distributions (0.42) (0.09)
--------- -----------
Change in net asset
value 1.78 (0.04)
--------- -----------
Net asset value, end
of period $17.01 $15.23
========= ===========
Total return((1)) 14.68% 0.34%((3))
Ratios/supplemental
data:
Net assets, end of
period (thousands) $16,971 $4,629
Ratio to average net
assets of:
Operating expenses 1.78% 1.65%((2))
Net investment
income 2.46% 2.36%((2))
Portfolio turnover 197% 159%
((1)) Maximum sales load is not reflected in the total return calculation.
((2)) Annualized
((3)) Not annualized
<PAGE>
CONVERTIBLE FUND SERIES
INVESTMENT ADVISER'S REPORT
Throughout 1995, we have seen considerable improvement in the performance of
the convertible market as compared with 1994. This is a result of the
strength in both the stock and bond markets throughout the year. For the 12
months ended October 31, 1995, the Convertible Fund's Class A shares produced
a total return of 11.45% and Class B shares returned 10.59%. For the same
period, the market returned 15.46%, as measured by the CS First Boston
Convertible Securities Index. All these figures assume reinvestment of any
distributions but exclude the effect of sales charges.
Throughout the fiscal year, we have maintained a moderately aggressive equity
posture, and despite the Fund's conservative nature and relatively low risk
profile, solid absolute gains have been achieved. Some of our holdings in the
financial sector, particularly our exposure to the multi-line insurance
companies, have greatly benefited performance. The portfolio's exposure to
our 21st Century Medicine theme has also performed well, with the
biotechnology holdings contributing meaningfully.
Phoenix Convertible Fund continues to seek low risk participation in the
equity markets with an emphasis on preservation of capital in difficult
market environments. In doing so, we remain committed to investing in a
diverse set of securities which emphasize higher quality, seasoned companies.
Moving forward, we will continue to focus on our Deregulating Financial
Services, Deregulating Media, and 21st Century Medicine themes. We also
believe that our Rising Energy Demand theme offers significant opportunity
and have recently increased exposure to the U.S. natural gas industry, which
we believe will benefit from strong demand and improving industry
fundamentals.
INVESTOR PROFILE
Phoenix Convertible Fund is best suited for an investor seeking to supplement
current income while maintaining the potential for growth.
<PAGE>
======================================LINE CHART===============================
First Boston
Convertible
Convertible Securities
Fund--Class A Index** S&P 500*
1985 9525 10000 10000
1986 11967 12541 13286
1987 13072 12328 14138
1988 13713 14129 16186
1989 16021 15901 20429
1990 16397 14067 18892
1991 19015 18838 25223
1992 21634 21750 27733
1993 24355 27089 31865
1994 23995 26605 33117
1995 26743 30718 41864
Average Annual Total Returns for Periods Ending 10/31/95
From Inception
7/15/94 to
1 Year 5 Years 10 Years 10/31/95
- --------------------------------------------------------------------------------
Class A with 4.75% sales charge 6.14% 9.19% 10.33% --
- --------------------------------------------------------------------------------
Class A at net asset value 11.45% 10.26% 10.87% --
- --------------------------------------------------------------------------------
Class B with CDSC 5.59% -- -- 5.44%
- --------------------------------------------------------------------------------
Class B at net asset value 10.59% -- -- 8.46%
- --------------------------------------------------------------------------------
S&P 500 Index* 26.41% 17.25% 15.40% 26.56%
- --------------------------------------------------------------------------------
First Boston Convertible Index** 15.46% 16.91% 11.88% 15.05%
===============================================================================
This chart assumes an initial gross investment of $10,000 made on 10/31/85
for Class A shares. The total return for Class A shares reflects the maximum
sales charge of 4.75% on the initial investment and assumes reinvestment of
dividends and capital gains. Class B share performance will be greater or
less than that shown based on differences in inception date, fees and sales
charges. The total return for Class B shares reflects the 5% contingent
deferred sales charge (CDSC), which is applicable on all shares redeemed
during the 1st year after purchase and 4% for all shares redeemed during the
2nd year after purchase (scaled down to 3%--3rd year; 2%--4th and 5th year
and 0% thereafter). Returns indicate past performance, which is not
predictive of future performance. Investment return and principal value will
fluctuate, so that your shares, when redeemed, may be worth more or less than
the original cost.
*The S&P 500 Index is an unmanaged but commonly used measure of common stock
total return performance. The S&P 500's performance does not reflect sales
charges.
**The First Boston Convertible Securities Index is an unmanaged but commonly
used index that tracks the returns of 250 to 300 convertible bonds and
preferreds rated B- or better by Standard and Poor's. The index's performance
does not reflect sales charges.
See Notes to Financial Statements
<PAGE>
INVESTMENTS AT OCTOBER 31, 1995
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
-------- ----- -------------
CONVERTIBLE BONDS--63.5%
Advertising--1.2%
Interpublic Group Euro. Cv.
3.75%, '02 NR $ 2,000 $ 1,795,000
Interpublic Group SDCV 144A
3.75%, '02 (c) NR 1,000 897,500
-----------
2,692,500
-----------
Banks--1.2%
Mitsubishi Bank Global Cv. 3%,
'02 AA- 2,500 2,584,375
-----------
Computer Software & Services--1.4%
Softkey SDCV 144A 5.50%, '00
(c) NR 2,000 1,690,000
Spectrum Holobyte Cv. 144A
6.50%, '02 (c) NR 1,500 1,387,500
-----------
3,077,500
-----------
Conglomerates--2.8%
Hanson America, Inc. Cv. 144A
2.39%, '01 (c) A+ 7,800 6,337,500
-----------
Electrical Equipment--0.9%
General Signal Corp. Cv. 5.75%,
'02 A- 2,000 2,072,500
-----------
Electronics--0.3%
VLSI Technology Cv. 8.25%, '05 B 750 710,625
-----------
Entertainment, Leisure & Gaming--7.2%
Comcast Corp. Cv. 3.375%,
'05 (e) B+ 5,000 4,750,000
Comcast Corp. Cv. 1.125%, '07 B+ 10,700 5,376,750
Time Warner, Inc. Cv. 8.75%,
'15 BB+ 4,088 4,236,397
Turner Broadcasting Cv. 144A
0%, '07 (c) BB- 4,000 1,785,000
-----------
16,148,147
-----------
Food--2.2%
Grand Metropolitan PLC Cv. 144A
6.50%, '00 (c) A+ 4,250 4,823,750
-----------
Healthcare--Diversified--4.4%
Roche Holdings, Inc. Cv. 144A
0%, '10 (c) NR 24,000 9,810,000
-----------
Healthcare--Drugs--4.7%
Chiron Corp. Cv. 144A 1.90%,
'00 (c) BBB+ 6,500 5,939,375
Genzyme Corp. Cv. 6.75%, '01 B+ 2,000 2,375,000
Sandoz Capital BVI, Ltd. Cv.
144A 2%, '02 (c) NR 2,100 1,858,500
-----------
10,172,875
-----------
Insurance--5.7%
Chubb Corp. Cv. 6%, '98 AA $ 8,000 $ 8,780,000
Cigna Corp. Cv. 8.20%, '10 BBB 1,000 1,435,000
Swiss Reinsurance Euro Cv. 144A
2%, '00 (c) NR 2,250 2,430,000
-----------
12,645,000
-----------
Machinery--0.8%
Albany International Corp. Cv.
5.25%, '02 BB- 2,000 1,810,000
-----------
Metals & Mining--0.3%
Agnico Mining SDCV 3.50%, '04 B+ 1,000 770,000
-----------
Natural Gas--2.5%
Apache Corp. Cv. 144A 6%, '02
(c) BBB- 2,000 2,195,000
Consolidated Natural Gas Co.
Cv. 7.25%, '15 A+ 3,250 3,363,750
-----------
5,558,750
-----------
Office & Business Equipment--0.4%
EMC Corp. Cv. 4.25%, '01 B+ 1,000 1,000,000
-----------
Oil--5.7%
Noble Affiliates, Inc. Cv.
4.25%, '03 BBB- 7,500 6,759,375
Pennzoil Co. Cv. 6.50%, '03 BBB 4,200 4,830,000
Pogo Producing Co. Cv. 5.50%,
'04 B 1,000 1,090,000
-----------
12,679,375
-----------
Pollution Control--5.4%
Browning-Ferris Industries,
Inc. Cv. 6.75%, '05 A- 2,000 1,990,000
Chemical Waste Management, Inc.
Cv. 0%, '10 A 25,500 10,136,250
-----------
12,126,250
-----------
Professional Services--0.7%
Career Horizons, Inc. Cv. 144A
7%, '02 (c) B((d)) 1,500 1,526,250
-----------
Publishing, Broadcasting, Printing & Cable--3.2%
Hollinger Lyons Cv. 0%, '13 BB 6,000 1,837,500
News America Holdings, Inc. Cv.
0%, '13 BBB 11,300 5,325,125
-----------
7,162,625
-----------
Retail--1.1%
Federated Department Stores Cv.
5%, '03 BB- 2,450 2,382,625
-----------
Retail--Drug--4.6%
Rite Aid Corp. Cv. 0%, '06 BBB+ 20,500 10,173,125
-----------
Retail--Food--0.4%
Food Lion, Inc. Cv. 144A 5%,
'03 (c) A 1,000 965,000
-----------
<PAGE>
Telecommunications Equipment--0.8%
General Instrument Corp. Cv.
5%, '00 BBB- $ 500 $ 502,500
Motorola, Inc. Cv. 0%, '13 AA- 1,500 1,231,875
-----------
1,734,375
-----------
Utility--Electric--0.4%
California Energy Cv. 144A C7,
5%, '00 (c) B 1,000 975,000
-----------
Utility--Telephone--5.2%
U.S. West, Inc. Euro Cv. 0%,
'11 A 35,000 11,681,250
-----------
TOTAL CONVERTIBLE BONDS
(Identified cost $138,443,807) 141,619,397
-----------
SHARES
------
CONVERTIBLE PREFERRED STOCKS--5.4%
Banks--0.5%
H. F. Ahmanson & Co. Cv. Pfd. 18,500 1,059,125
-----------
Electrical Equipment--0.8%
Westinghouse Electric Corp. Cv. Pfd.
144A $1.30 (c) 127,500 1,785,000
-----------
Metals & Mining--0.7%
Freeport-McMoRan Copper Cv. Pfd.
(5%, '96) 7%, '02 60,000 1,432,500
-----------
Oil--2.8%
Occidental Petroleum Corp. 144A
3.875% Cv. Pfd. (c) 55,000 3,059,375
Unocal Corp. 144A $3.50 Cv. Pfd. (c) 25,000 1,306,250
Valero Energy Corp. Cv. Pfd. 6.25% 37,900 1,899,738
-----------
6,265,363
-----------
Paper & Forest Products--0.6%
International Paper Co. 144A Cv. Pfd
5.25% (c) 32,500 1,430,000
-----------
TOTAL CONVERTIBLE PREFERRED STOCKS
(Identified cost $11,570,442) 11,971,988
-----------
COMMON STOCKS--13.6%
Diversified Financial Services--0.5%
Travelers Group, Inc. 22,000 1,111,000
-----------
Electronics--0.7%
Perkin Elmer Corp. 45,000 1,580,625
-----------
SHARES VALUE
------ -------------
Healthcare--Diversified--0.5%
Warner-Lambert Co. 12,500 $ 1,064,063
-----------
Hospital Management & Services--0.3%
Vencor, Inc. (b) 23,800 660,450
-----------
Insurance--0.8%
Aetna Life & Casualty Co. 25,000 1,759,375
-----------
Natural Gas--5.1%
Consolidated Natural Gas Co. 60,000 2,280,000
El Paso Natural Gas Co. 75,000 2,025,000
Enron Corp. 65,000 2,234,375
Equitable Resources, Inc. 80,000 2,340,000
Seagull Energy Corp. (b) 150,000 2,568,750
-----------
11,448,125
-----------
Oil--3.8%
Amoco Corp. 44,904 2,868,243
Atlantic Richfield Co. 13,500 1,441,125
Mobil Corp. 12,500 1,259,375
Sun Company, Inc. 35,000 1,001,875
Unocal Corp. 75,000 1,968,750
-----------
8,539,368
-----------
Pollution Control--0.2%
Browning-Ferris Industries, Inc. 12,000 349,500
-----------
Professional Services--1.0%
Manpower, Inc. 81,983 2,223,788
-----------
Utility--Electric--0.7%
CMS Energy Corp. 60,000 1,657,500
-----------
TOTAL COMMON STOCKS
(Identified cost $30,327,231) 30,393,794
-----------
FOREIGN COMMON STOCKS--0.7%
Italy--0.2%
Textile & Apparel--0.2%
Gucci Group NV (b) 13,000 390,000
-----------
Netherlands--0.5%
Oil--0.5%
Royal Dutch Petroleum Co. ADR 10,000 1,228,750
-----------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $1,387,602) 1,618,750
-----------
TOTAL LONG-TERM INVESTMENTS--83.2%
(Identified cost $181,729,082) 185,603,929
-----------
<PAGE>
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
-------- ------ -------------
SHORT-TERM OBLIGATIONS--16.1%
Commercial Paper--16.1%
Emerson Electric 5.70%,
11-1-95 A-1+ $ 5,000 $ 5,000,000
Mobil 5.85%, 11-1-95 A-1+ 1,105 1,105,000
Coca Cola 5.70%, 11-3-95 A-1+ 1,250 1,249,604
McDonald's Corp. 5.70%,
11-3-95 A-1+ 2,000 1,999,367
Pfizer, Inc. 5.70%, 11-3-95 A-1+ 4,765 4,763,491
GTE North 5.73%, 11-7-95 A-1+ 3,110 3,107,030
McDonald's Corp. 5.72%,
11-8-95 A-1+ 3,860 3,855,707
Unilever Capital 5.67%,
11-8-95 A-1+ 2,090 2,087,696
Proctor & Gamble 5.72%,
11-10-95 A-1+ 3,585 3,579,873
BellSouth Telecommunications
5.72%, 11-15-95 A-1+ 910 907,976
Commercial Paper--continued
H.J. Heinz, Inc. 5.72%,
11-17-95 A-1- $ 600 $ 598,475
TDK USA 5.72%, 11-17-95 A-1+ 2,750 2,743,009
E.I. DuPont de Nemours
5.71%, 11-21-95 A-1+ 955 951,970
Warner-Lambert 5.70%,
11-30-95 A-1+ 3,910 3,892,046
-----------
35,841,244
-----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $35,841,244) 35,841,244
-----------
TOTAL INVESTMENTS--99.3%
(Identified cost $217,570,326) 221,445,173(a)
Cash & receivables, less
liabilities--0.7% 1,654,534
-----------
NET ASSETS--100.0% $223,099,707
===========
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $9,441,835 and gross
depreciation of $5,507,014 for income tax purposes. At October 31, 1995,
the aggregate cost of securities for federal income tax purposes was
$217,510,352.
(b) Non-income producing.
(c) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At October 31,
1995, these securities amounted to a value of $50,201,000 or 22.5% of net
assets.
(d) As rated by Moody's, Fitch or Duff & Phelps.
(e) Variable or step coupon bond; interest rate shown reflects the rate
currently in effect.
ADR--American Depository Receipt
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1995
Assets
Investment securities at value
(Identified cost $217,570,326) $221,445,173
Cash 8,472
Receivables
Investment securities sold 873,951
Fund shares sold 23,686
Dividends and interest 1,246,009
-----------
Total assets 223,597,291
-----------
Liabilities
Payables
Fund shares repurchased 220,231
Investment advisory fee 124,967
Distribution fee 50,317
Transfer agent fee 50,662
Financial agent fee 5,767
Trustees' fee 5,241
Accrued expenses 40,399
-----------
Total liabilities 497,584
-----------
Net Assets $223,099,707
===========
Net Assets Consist of:
Capital paid in on shares of beneficial interest $211,056,115
Undistributed net investment income 1,322,557
Accumulated net realized gains 6,846,188
Net unrealized appreciation 3,874,847
-----------
Net Assets $223,099,707
===========
Class A
Shares of beneficial interest outstanding, $1 par
value,
unlimited authorization (Net Assets $219,384,122) 12,035,606
Net asset value per share $18.23
Offering price per share
$18.23/(1-4.75%) $19.14
Class B
Shares of beneficial interest outstanding, $1 par
value,
unlimited authorization (Net Assets $3,715,585) 204,450
Net asset value and offering price per share $18.17
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1995
Investment Income
Dividends $ 1,535,402
Interest 11,630,549
---------
Total Investment Income 13,165,951
---------
Expenses
Investment advisory fee 1,438,064
Distribution fee--Class A 547,453
Distribution fee--Class B 22,594
Financial agent fee 66,372
Transfer agent 368,262
Registration 33,579
Printing 32,165
Custodian 31,542
Professional 21,166
Trustees 16,250
Miscellaneous 42,304
---------
Total Expenses 2,619,751
---------
Net Investment Income 10,546,200
---------
Net Realized and Unrealized Gain (Loss)
on Investments
Net realized gain on securities 6,913,139
Net unrealized appreciation on
investments 6,261,043
---------
Net gain on investments 13,174,182
---------
Net increase in net assets resulting from
operations $23,720,382
=========
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
October 31, October 31,
1995 1994
------------- ---------------
From Operations
Net investment income $ 10,546,200 $ 10,237,483
Net realized gain 6,913,139 2,502,515
Net unrealized appreciation
(depreciation) 6,261,043 (16,571,486)
----------- -------------
Increase (decrease) in net assets
resulting from operations 23,720,382 (3,831,488)
----------- -------------
From Distributions to Shareholders
Net investment income--Class A (12,970,385) (9,093,961)
Net investment income--Class B (119,217) (2,320)
Net realized gains--Class A (2,391,510) (10,558,572)
Net realized gains--Class B (12,867) --
----------- -------------
Decrease in net assets from
distributions to shareholders (15,493,979) (19,654,853)
----------- -------------
From Share Transactions
Class A
Proceeds from sales of shares
(1,382,175 and 1,725,250 shares,
respectively) 24,342,158 31,385,401
Net asset value of shares issued from
reinvestment of distributions (722,912
and 889,666 shares, respectively) 12,522,376 16,005,344
Cost of shares repurchased (2,957,778
and 2,759,745 shares, respectively) (51,872,715) (49,682,138)
----------- -------------
Total (15,008,181) (2,291,393)
----------- -------------
Class B
Proceeds from sales of shares (158,935
and 62,836 shares, respectively) 2,790,598 1,106,801
Net asset value of shares issued from
reinvestment of distributions (6,511
and 126 shares, respectively) 114,320 2,208
Cost of shares repurchased (9,767 and
14,191 shares, respectively) (173,872) (252,704)
----------- -------------
Total 2,731,046 856,305
----------- -------------
Decrease in net assets from share
transactions (12,277,135) (1,435,088)
----------- -------------
Net decrease in net assets (4,050,732) (24,921,429)
Net Assets
Beginning of period 227,150,439 252,071,868
----------- -------------
End of period (including undistributed
net investment income of $1,322,557 and
$3,828,214, respectively) $223,099,707 $227,150,439
=========== =============
<PAGE>
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
Class A
-----------------------------------------------------
Year Ended October 31,
1995 1994 1993 1992 1991
------- ------- ------- ------- ---------
Net asset value,
beginning of
period $17.56 $19.34 $18.86 $18.36 $16.63
Income from
investment
operations
Net investment
income 0.87 0.78 0.68 0.77 0.87
Net realized and
unrealized gain
(loss) 1.04 (1.06) 1.53 1.54 1.75
------ ------ ------ ------ -------
Total from
investment
operations 1.91 (0.28) 2.21 2.31 2.62
------ ------ ------ ------ -------
Less distributions
Dividends from net
investment income (1.05) (0.69) (0.73) (0.72) (0.89)
Dividends from net
realized gains (0.19) (0.81) (1.00) (1.09) --
------ ------ ------ ------ -------
Total distributions (1.24) (1.50) (1.73) (1.81) (0.89)
------ ------ ------ ------ -------
Change in net asset
value 0.67 (1.78) 0.48 0.50 1.73
------ ------ ------ ------ -------
Net asset value, end
of period $18.23 $17.56 $19.34 $18.86 $18.36
====== ====== ====== ====== =======
Total return((1)) 11.45% -1.48% 12.58% 13.77% 15.97%
Ratios/supplemental
data:
Net assets, end of
period (thousands) $219,384 $226,294 $252,072 $200,944 $169,288
Ratio to average net
assets of:
Operating expenses 1.18% 1.14% 1.15% 1.20% 1.14%
Net investment
income 4.78% 4.27% 3.70% 4.28% 4.84%
Portfolio turnover 79% 91% 94% 200% 284%
Class B
-------------------------------
Year From
Ended Inception
October 31, 7/15/94 to
1995 10/31/94
--------------- -------------
Net asset value,
beginning of
period $17.55 $17.59
Income from
investment
operations
Net investment
income 0.70((4)) 0.15
Net realized and
unrealized gain
(loss) 1.07 (0.06)
------------- -----------
Total from
investment
operations 1.77 0.09
------------- -----------
Less distributions
Dividends from net
investment income (0.96) (0.13)
Dividends from net
realized gains (0.19) --
------------- -----------
Total distributions (1.15) (0.13)
------------- -----------
Change in net asset
value 0.62 (0.04)
------------- -----------
Net asset value, end
of period $18.17 $17.55
============= ===========
Total return((1)) 10.59% 0.49%((3))
Ratios/supplemental
data:
Net assets, end of
period (thousands) $3,715 $856
Ratio to average net
assets of:
Operating expenses 1.95% 1.83%((2))
Net investment
income 3.92% 3.29%((2))
Portfolio turnover 79% 91%
((1)) Maximum sales load is not reflected in the total return calculation.
((2)) Annualized
((3)) Not annualized
((4)) Computed using average shares outstanding.
<PAGE>
GROWTH FUND SERIES
INVESTMENT ADVISER'S REPORT
Phoenix Growth Fund benefited from the strong 1995 stock market rally,
providing attractive absolute returns. For the twelve months ended October
31, 1995, Class A shares produced a total return of 23.91% and Class B shares
returned 23.02%. These results compare with the 26.41% total return of the
S&P 500 Index over the same period. All these figures assume reinvestment of
any distributions but exclude the effect of sales charges.
Over the last twelve months, cash reserves were reduced from approximately
17% to 11% to take advantage of the robust stock market environment.
Overweight positions in technology, health care and capital goods helped the
portfolio's performance. Some of the stronger performers in these sectors
included Hewlett Packard, Amgen, and Boeing.
Certain individual holdings held the performance back. Most notably, these
stocks included Archer Daniels Midland and Humana. These securities were sold
based on our analysis of the company or industry specific problems. The
portfolio's underweighting in financial services early in 1995 also resulted
in missing some of this sector's strong performance.
Looking forward, we expect increased volatility as investors move to protect
their gains before yearend. We continue to find promising investment
opportunities in such themes as 21st Century Medicine, Hybrid Network,
Deregulating Financial Services, and Farming for Yield.
INVESTOR PROFILE
Phoenix Growth Fund is best suited for an investor seeking the potential for
long-term growth through investments in quality common stocks.
======================================LINE CHART===============================
Growth Fund--
S&P 500* Class A
1985 9525 10000
1986 12897 13286
1987 14180 14138
1988 15171 16186
1989 18423 20429
1990 18986 18892
1991 24866 25223
1992 26593 27733
1993 28508 31865
1994 29096 33117
1995 36052 41864
Average Annual Total Returns for Periods Ending 10/31/95
From Inception
7/15/94 to
1 Year 5 Years 10 Years 10/31/95
- --------------------------------------------------------------------------------
Class A with 4.75% sales charge 18.02% 12.56% 13.67% --
- --------------------------------------------------------------------------------
Class A at net asset value 23.91% 13.66% 14.22% --
- --------------------------------------------------------------------------------
Class B with CDSC 18.02% -- -- 17.47%
- --------------------------------------------------------------------------------
Class B at net asset value 23.02% -- -- 20.39%
- --------------------------------------------------------------------------------
S&P 500 Index* 26.41% 17.25% 15.40% 26.56%
================================================================================
This chart assumes an initial gross investment of $10,000 made on 10/31/85
for Class A shares. The total return for Class A shares reflects the maximum
sales charge of 4.75% on the initial investment and assumes reinvestment of
dividends and capital gains. Class B share performance will be greater or
less than that shown based on differences in inception dates, fees and sales
charges. The total return for Class B shares reflects the 5% contingent
deferred sales charge (CDSC), which is applicable on all shares redeemed
during the 1st year after purchase and 4% for all shares redeemed during the
2nd year after purchase (scaled down to 3%--3rd year; 2%--4th and 5th year
and 0% thereafter). Returns indicate past performance, which is not
predictive of future performance. Investment return and principal value will
fluctuate, so that your shares, when redeemed, may be worth more or less than
the original cost.
*The S&P 500 Index is an unmanaged but commonly used measure of common stock
total return performance. The S&P 500's performance does not reflect sales
charges.
<PAGE>
INVESTMENTS AT OCTOBER 31, 1995
SHARES VALUE
-------- --------------
COMMON STOCKS--78.6%
Aerospace & Defense--5.2%
Boeing Company 650,000 $ 42,656,250
McDonnell Douglas Corp. 400,000 32,700,000
United Technologies Corp. 500,000 44,375,000
------------
119,731,250
------------
Banks--3.5%
Chase Manhattan Corp. 750,000 42,750,000
Citicorp 600,000 38,925,000
------------
81,675,000
------------
Building & Materials--1.0%
PPG Industries, Inc. 550,000 23,375,000
------------
Chemical--2.1%
IMC Global, Inc. 121,000 8,470,000
Monsanto Co. 290,000 30,377,500
Arcadian Corp. 500,000 10,312,500
------------
49,160,000
------------
Chemical--Specialty--1.0%
Morton International, Inc. 750,000 22,875,000
------------
Computer Software & Services--4.2%
Computer Associates
International, Inc. 650,000 35,750,000
Oracle Systems Corp. (b) 850,000 37,081,250
Sybase, Inc. (b) 600,000 23,550,000
------------
96,381,250
------------
Conglomerates--2.0%
ITT Corp. 300,000 36,750,000
TRW, Inc. 145,000 9,533,750
------------
46,283,750
------------
Cosmetics & Soaps--1.9%
Gillette Co. 900,000 43,537,500
------------
Diversified Financial Services--4.5%
American Express Co. 1,000,000 40,625,000
Dean Witter Discover & Co. 600,000 29,850,000
Morgan Stanley Group, Inc. 400,000 34,800,000
------------
105,275,000
------------
Electrical Equipment--3.2%
Emerson Electric Co. 400,000 28,500,000
General Electric Co. 700,000 44,275,000
------------
72,775,000
------------
Electronics--0.5%
Perkin Elmer Corp. 325,000 11,415,625
------------
Entertainment, Leisure & Gaming--1.5%
Walt Disney Co. 600,000 34,575,000
------------
Food--1.4%
CPC International, Inc. 500,000 33,187,500
------------
Healthcare--Drugs--4.0%
Amgen, Inc. (b) 600,000 28,800,000
Genzyme Corp. 500,000 $ 29,125,000
Merck & Co., Inc. 600,000 34,500,000
------------
92,425,000
------------
Hospital Management & Services--1.8%
Cerner Corp. (b) 500,000 13,250,000
Columbia/HCA Healthcare
Corp. 550,000 27,018,750
------------
40,268,750
------------
Insurance--3.1%
American International
Group, Inc. 300,000 25,312,500
Cigna Corp. 468,000 46,390,500
------------
71,703,000
------------
Lodging & Restaurants--2.1%
Marriott International, Inc. 1,000,000 36,875,000
Starbucks Corp. (b) 300,000 11,775,000
------------
48,650,000
------------
Machinery--2.5%
Deere & Co. 425,000 37,984,375
Parker-Hannifin Corp. 600,000 20,250,000
------------
58,234,375
------------
Medical Products & Supplies--4.7%
Baxter International, Inc. 1,100,000 42,487,500
Johnson & Johnson 500,000 40,750,000
St. Jude Medical, Inc. 500,000 26,625,000
------------
109,862,500
------------
Office & Business Equipment--3.2%
Hewlett Packard Co. 300,000 27,787,500
Sun Microsystems, Inc. (b) 600,000 46,800,000
------------
74,587,500
------------
Oil--1.8%
Mobil Corp. 400,000 40,300,000
------------
Oil Service & Equipment--1.3%
Schlumberger Ltd. 500,000 31,125,000
------------
Paper & Forest Products--1.1%
Bowater, Inc. 600,000 26,550,000
------------
Professional Services--1.4%
First Data Corp. 475,770 31,460,291
------------
Retail--3.2%
Federated Department Stores,
Inc. (b) 1,250,000 31,718,750
Office Depot, Inc. (b) 750,000 21,468,750
Staples, Inc. (b) 750,000 19,968,750
------------
73,156,250
------------
Telecommunications Equipment--5.2%
Bay Networks, Inc. (b) 430,000 28,487,500
cisco Systems, Inc. (b) 350,000 27,125,000
DSC Communications Corp. (b) 600,000 22,200,000
Motorola, Inc. 350,000 22,968,750
Tellabs, Inc. (b) 600,000 20,400,000
------------
121,181,250
------------
<PAGE>
Textiles & Apparel--1.2%
Nike, Inc. Class B 500,000 $ 28,375,000
------------
Tobacco--1.8%
Philip Morris Companies,
Inc. 500,000 42,250,000
------------
Utility--Electric--2.4%
American Electric Power,
Inc. 740,000 28,212,500
Entergy Corp. 1,000,000 28,500,000
------------
56,712,500
------------
Utility--Telephone--5.8%
AT & T Corp. 900,000 57,600,000
Ameritech Corp. 750,000 40,500,000
MCI Communications Corp. 1,500,000 37,406,250
------------
135,506,250
------------
TOTAL COMMON STOCKS
(Identified cost $1,494,394,043) 1,822,594,541
------------
FOREIGN COMMON STOCKS--10.9%
Finland--1.0%
Telecommunications Equipment--1.0%
Nokia AB 400,000 22,888,000
------------
Italy--0.0%
Medical Products & Supplies--0.0%
De Rigo S.P.A. ADR (b) 42,000 866,250
------------
Japan--1.6%
Autos &
Trucks--0.5%
Nissan Motor Co. 1,000,000 6,650,000
Toyota Motor Corp. 325,000 6,038,500
------------
12,688,500
------------
Banks--0.3%
Mitsubishi Trust & Banking 596,000 7,813,560
------------
Electronics--0.4%
Kyocera Corp. 108,000 8,851,680
------------
Entertainment &
Leisure--0.4%
Nintendo 116,000 8,531,800
------------
Netherlands--0.8%
Electronics--0.8%
Philips Electronics N.V. ADR 500,000 19,312,500
------------
Sweden--2.4%
Healthcare--Drugs--1.3%
Astra AB Ser. A 805,000 29,567,650
------------
Paper & Forest Products--0.1%
Stora Kopparbergs (b) 184,000 2,230,080
------------
Telecommunications Equipment--1.0%
Ericsson L.M. Telephone Co.
Class B
ADR 1,100,000 23,495,230
------------
Switzerland--2.2%
Electrical Equipment--1.0%
Brown Boveri & Cie 20,000 23,176,400
------------
Healthcare--Diversified--1.2%
Ciba-Geigy AG-Registered 32,000 27,678,080
------------
United Kingdom--2.9%
Healthcare--Diversified--1.8%
Smithkline Beecham PLC ADR 800,000 $ 41,500,000
------------
Oil--1.1%
British Petroleum PLC ADR 300,000 26,475,000
------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $187,338,566) 255,074,730
------------
TOTAL LONG-TERM INVESTMENTS--89.5%
(Identified cost $1,681,732,609) 2,077,669,271
------------
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000)
-------- -----
SHORT-TERM OBLIGATIONS--8.8%
Commercial Paper--7.4%
AT&T 5.70%, 11-1-95 A-1+ $ 7,945 7,945,000
Philip Morris Cos., Inc.
5.72%, 11-1-95 A-1 10,000 10,000,000
E.I. DuPont de Nemours
5.72%, 11-3-95 A-1+ 4,020 4,018,723
McDonald's Corp. 5.70%,
11-3-95 A-1+ 10,000 9,996,833
Albertson's, Inc. 5.72%,
11-6-95 A-1 9,695 9,687,298
Pfizer, Inc. 5.66%, 11-6-95 A-1+ 5,000 4,996,069
Albertson's, Inc. 5.72%,
11-7-95 A-1 5,000 4,995,233
Wal-Mart Stores, Inc. 5.75%,
11-7-95 A-1+ 7,000 6,993,292
McDonald's Corp. 5.72%,
11-8-95 A-1+ 6,165 6,158,143
Philip Morris Capital Corp.
5.69%, 11-8-95 A-1 5,000 4,994,468
Albertson's, Inc. 5.70%,
11-10-95 A-1 6,000 5,991,450
BellSouth
Telecommunications, Inc.
5.70%, 11-13-95 A-1+ 3,725 3,717,923
TDK USA 5.73%, 11-13-95 A-1+ 5,000 4,990,450
Albertson's, Inc. 5.70%,
11-14-95 A-1 3,290 3,283,228
McDonald's Corp. 5.72%,
11-14-95 A-1+ 15,765 15,732,437
Kimberly-Clark Corp. 5.75%,
11-17-95 A-1+ 5,725 5,710,369
TDK USA 5.72%, 11-17-95 A-1+ 8,550 8,528,264
Wal-Mart Stores, Inc. 5.70%,
11-17-95 A-1+ 7,000 6,982,267
Unilever Capital Corp.
5.69%, 11-21-95 A-1+ 2,350 2,342,571
BellSouth
Telecommunications, Inc.
5.72%, 11-22-95 A-1+ 6,545 6,523,162
Wal-Mart Stores, Inc. 5.70%,
11-29-95 A-1+ 3,050 3,036,478
<PAGE>
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
-------- ----- -----------
Commercial Paper--continued
Philip Morris Cos., Inc.
5.70%, 12-1-95 A-1 $4,610 $ 4,588,103
E.I. DuPont de Nemours
5.69%, 12-4-95 A-1+ 3,240 3,223,101
E.I. DuPont de Nemours
5.69%, 12-5-95 A-1+ 4,000 3,978,504
E.I. DuPont de Nemours
5.70%, 12-5-95 A-1+ 8,005 7,960,401
Pfizer, Inc. 5.70%, 12-6-95 A-1+ 6,000 5,966,750
Unilever Capital Corp.
5.67%, 12-14-95 A-1+ 4,040 4,012,639
General Electric Capital
5.91%, 7-26-96 A-1+ 4,500 4,499,955
---------
170,853,111
---------
PAR
VALUE
(000) VALUE
----- -----------
Federal Agency Securities--1.4%
Federal Farm Credit Bank 6.33%,
11-1-95 $ 7,000 $ 7,000,000
Federal Home Loan Mortgage 5.85%,
11-1-95 18,075 18,075,000
Student Loan Marketing Association
5.65%, 1-11-96 5,000 5,000,000
Federal Home Loan Banks 6.52%, 1-19-96 3,840 3,792,653
---------
33,867,653
---------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $204,719,084) 204,720,764
-----------
TOTAL INVESTMENTS--98.3%
(Identified cost $1,886,451,693) 2,282,390,035(a)
Cash & receivables, less liabilities--1.7% 37,972,107
-----------
NET ASSETS--100.0% $2,320,362,142
===========
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $422,750,442 and gross
depreciation of $26,823,382 for income tax purposes. At October 31, 1995,
the aggregate cost of securities for federal income tax purposes was
$1,886,462,975
(b) Non-income producing.
ADR--American Depository Receipt
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1995
Assets
Investment securities at value
(Identified cost $1,886,451,693) $2,282,390,035
Cash 19,849
Receivables
Investment securities sold 71,934,306
Fund shares sold 1,033,058
Dividends and interest 2,936,087
-----------
Total assets 2,358,313,335
-----------
Liabilities
Payables
Investment securities purchased 32,271,578
Fund shares repurchased 2,915,759
Investment advisory fee 1,321,993
Financial agent fee 52,730
Distribution fee 510,110
Transfer agent fee 573,650
Trustees' fee 5,850
Accrued expenses 299,523
-----------
Total liabilities 37,951,193
-----------
Net Assets $2,320,362,142
===========
Net Assets Consist of:
Capital paid in on shares of beneficial interest $1,764,866,661
Undistributed net investment income 8,762,468
Accumulated net realized gains 150,794,671
Net unrealized appreciation 395,938,342
-----------
Net Assets $2,320,362,142
===========
Class A
Shares of beneficial interest outstanding,
$1 par value, unlimited authorization
(Net Assets $2,300,250,886) 92,305,384
Net asset value per share $24.92
Offering price per share
$24.92/(1-4.75%) $26.16
Class B
Shares of beneficial interest outstanding,
$1 par value, unlimited authorization
(Net Assets $20,111,256) 812,938
Net asset value and offering price per share $24.74
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1995
Investment Income
Dividends (net of foreign taxes of $551,484) $ 32,434,053
Interest 13,680,026
----------
Total Investment Income 46,114,079
----------
Expenses
Investment advisory fee 14,508,081
Distribution fee--Class A 5,393,485
Distribution fee--Class B 106,198
Financial agent fee 643,404
Transfer agent 4,622,101
Printing 339,858
Custodian 252,392
Professional 75,744
Registration 75,209
Trustees 16,250
Miscellaneous 171,189
----------
Total Expenses 26,203,911
----------
Net Investment Income 19,910,168
----------
Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain on securities 150,995,548
Net realized gain on foreign currency transactions 4,626,158
Net unrealized appreciation on investments 290,325,083
----------
Net gain on investments 445,946,789
----------
Net increase in net assets resulting from operations $465,856,957
==========
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
October 31, October 31,
1995 1994
----------- -------------
From Operations
Net investment income $ 19,910,168 $ 27,857,990
Net realized gain 155,621,706 82,419,261
Net unrealized appreciation (depreciation) 290,325,083 (66,347,670)
--------- -----------
Increase in net assets resulting from
operations 465,856,957 43,929,581
--------- -----------
From Distributions to Shareholders
Net investment income--Class A (29,146,274) (27,374,495)
Net investment income--Class B (70,729) --
Net realized gains--Class A (80,021,516) (55,054,888)
Net realized gains--Class B (163,754) --
--------- -----------
Decrease in net assets from distributions
to shareholders (109,402,273) (82,429,383)
--------- -----------
From Share Transactions
Class A
Proceeds from sales of shares (11,080,464
and 11,908,660 shares, respectively) 244,386,687 249,411,073
Net asset value of shares issued from
reinvestment of distributions
(5,065,877 and 3,499,935 shares,
respectively) 100,757,525 73,320,069
Cost of shares repurchased (24,592,373 and
33,712,698 shares, respectively) (539,504,775) (707,153,244)
--------- -----------
Total (194,360,563) (384,422,102)
--------- -----------
Class B
Proceeds from sales of shares (726,554 and
141,944 shares, respectively) 16,077,649 2,945,409
Net asset value of shares issued from
reinvestment of distributions
(10,621 and 0 shares, respectively) 212,004 --
Cost of shares repurchased (64,169 and
2,012 shares, respectively) (1,445,729) (41,813)
--------- -----------
Total 14,843,924 2,903,596
--------- -----------
Decrease in net assets from share
transactions (179,516,639) (381,518,506)
--------- -----------
Net increase (decrease) in net assets 176,938,045 (420,018,308)
Net Assets
Beginning of period 2,143,424,097 2,563,442,405
--------- -----------
End of period (including undistributed net
investment income of $8,762,468 and
$13,473,476, respectively) $2,320,362,142 $2,143,424,097
========= ===========
<PAGE>
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
Class A
-----------------------------------------------------
Year Ended October 31,
1995 1994 1993 1992 1991
------- ------- ------- ------- ---------
Net asset value,
beginning of
period $21.24 $21.53 $20.76 $22.60 $18.45
Income from
investment
operations((5))
Net investment
income 0.26 0.26 0.32 0.36 0.50
Net realized and
unrealized gain 4.53 0.17 1.15 0.97 4.97
------ ------ ------ ------ -------
Total from
investment
operations 4.79 0.43 1.47 1.33 5.47
------ ------ ------ ------ -------
Less
distributions
Dividends from
net investment
income (0.30) (0.24) (0.32) (0.45) (0.55)
Dividends from
net realized
gains (0.81) (0.48) (0.38) (2.72) (0.77)
------ ------ ------ ------ -------
Total
distributions (1.11) (0.72) (0.70) (3.17) (1.32)
------ ------ ------ ------ -------
Change in net
asset value 3.68 (0.29) 0.77 (1.84) 4.15
------ ------ ------ ------ -------
Net asset value,
end of period $24.92 $21.24 $21.53 $20.76 $22.60
====== ====== ====== ====== =======
Total return((1)) 23.91% 2.06% 7.20% 6.95% 30.97%
Ratios/
supplemental
data:
Net assets, end
of period
(thousands) $2,300,251 $2,140,458 $2,563,442 $2,186,868 $1,251,565
Ratio to average
net assets of:
Operating
expenses 1.20% 1.19% 1.18% 1.17% 1.15%
Net investment
income 0.92% 1.22% 1.55% 1.86% 2.49%
Portfolio
turnover 109% 118% 176% 192% 227%
Class B
-------------------------------
Year From
Ended Inception
October 31, 7/15/94 to
1995 10/31/94
------------- --------------
Net asset value,
beginning of
period $ 21.19 $ 20.48
Income from
investment
operations((5))
Net investment
income 0.00((4)) 0.01
Net realized and
unrealized gain 4.60 0.70
----------- -------------
Total from
investment
operations 4.60 0.71
----------- -------------
Less distributions
Dividends from net
investment income (0.24) --
Dividends from net
realized gains (0.81) --
----------- -------------
Total
distributions (1.05) --
----------- -------------
Change in net asset
value 3.55 0.71
----------- -------------
Net asset value, end
of period $ 24.74 $ 21.19
=========== =============
Total return((1)) 23.02% 3.47%((3))
Ratios/supplemental
data:
Net assets, end of
period (thousands) $20,111 $2,966
Ratio to average net
assets of:
Operating expenses 1.97% 1.87%((2))
Net investment
income 0.01% 0.32%((2))
Portfolio turnover 109% 118%
((1)) Maximum sales load is not reflected in the total return calculation.
((2)) Annualized
((3)) Not annualized
((4)) Computed using average shares outstanding.
((5)) Distributions are made in accordance with the prospectus; however,
class level per share income from investment operations may vary from
anticipated results depending on the time of share purchases and
redemptions.
<PAGE>
U.S. STOCK FUND SERIES
INVESTMENT ADVISER'S REPORT
Phoenix U.S. Stock Fund produced strong returns during the most recent fiscal
year. For the twelve months ended October 31, 1995, the Fund outperformed the
Standard & Poor's 500 Index. The total returns for Class A and B shares were
35.14% and 34.15%, respectively, and compared favorably with the S&P 500
return of 26.41% for the same twelve month-period. All these figures assume
reinvestment of any distributions but exclude the effect of sales charges.
The Fund focuses on domestic companies expected to increase revenues,
operating profit and earnings per share by at least 20% annually. This
emphasis on high growth companies leads the Fund into many of the Phoenix
investment themes during the early stages of a theme's lifecycle. We were an
early investor in the Internet Connection theme and had approximately 20% of
the Fund's assets invested in leading Internet related companies such as
America Online, Intuit, Netscape, Spyglass and UUNET. Other themes currently
emphasized in the portfolio include Media Deregulation and Shift to Digital.
The early and significant exposure to our Internet Connection theme helped
performance, especially in September and October. In addition, the
consistently large exposure to technology stocks throughout 1995 has
contributed strongly to performance.
As 1995 comes to a close, the Dow Jones Industrial Average has already pushed
past 5000. We anticipate technology stocks could continue to rally if
personal computer sales remain strong, semiconductor pricing stabilizes and
interest rates trend slightly lower. Further market acceptance of our belief
that the Internet represents one of the most important secular changes of
this decade could produce additional outperformance from stocks in this area.
We would like to caution shareholders that the equity returns seen in 1995
are unusually high and expectations for 1996 performance should not be based
on 1995 results. It is our belief that next year will be a highly selective
market and double-digit returns will be more difficult to attain.
INVESTOR PROFILE
Phoenix U.S. Stock Fund is best suited for an investor who desires an
aggressively managed portfolio designed for maximum appreciation of capital
with little or no current income.
<PAGE>
======================================LINE CHART===============================
U.S. Stock Fund--
Class A S&P 500*
1985 9525 10000
1986 13196 13286
1987 13786 14138
1988 14409 16186
1989 17088 20429
1990 14820 18892
1991 20746 25223
1992 22222 27733
1993 25366 31865
1994 25460 33117
1995 34407 41864
Average Annual Total Returns for Periods Ending 10/31/95
From Inception
7/21/94 to
1 Year 5 Years 10 Years 10/31/95
- --------------------------------------------------------------------------------
Class A with 4.75% sales charge 28.76% 17.16% 13.14% --
- --------------------------------------------------------------------------------
Class A at net asset value 35.14% 18.31% 13.69% --
- --------------------------------------------------------------------------------
Class B with CDSC 29.15% -- -- 24.29%
- --------------------------------------------------------------------------------
Class B at net asset value 34.15% -- -- 27.22%
- --------------------------------------------------------------------------------
S&P 500 Index* 26.41% 17.25% 15.40% 26.94%
================================================================================
This chart assumes an initial gross investment of $10,000 made on 10/31/85
for Class A shares. The total return for Class A shares reflects the maximum
sales charge of 4.75% on the initial investment and assumes reinvestment of
dividends and capital gains. Class B share performance will be greater or
less than that shown based on differences in inception dates, fees and sales
charges. The total return for Class B shares reflects the 5% contingent
deferred sales charge (CDSC), which is applicable on all shares redeemed
during the 1st year after purchase and 4% for all shares redeemed during the
2nd year after purchase (scaled down to 3%--3rd year; 2%--4th and 5th year
and 0% thereafter). Returns indicate past performance, which is not
predictive of future performance. Investment return and principal value will
fluctuate, so that your shares, when redeemed, may be worth more or less than
the original cost.
*The S&P 500 Index is an unmanaged but commonly used measure of common stock
total return performance. The S&P 500's performance does not reflect sales
charges.
See Notes to Financial Statements
<PAGE>
INVESTMENTS AT OCTOBER 31, 1995
SHARES VALUE
------ -----------
COMMON STOCKS--94.3%
Airlines--1.5%
Continental Airlines Class B (b) 75,000 $ 2,671,875
---------
Banks--3.5%
Astoria Financial Corp. 25,000 1,071,875
TCF Financial Corp. 90,000 5,287,500
---------
6,359,375
---------
Computer Software & Services--19.7%
America Online, Inc. (b) 30,000 2,400,000
Checkfree Corp. (b) 13,000 274,625
Creative Computers, Inc. (b) 80,500 2,334,500
FORE Systems, Inc. (b) 10,000 530,000
Intuit (b) 70,000 5,040,000
Legato Systems, Inc. (b) 32,500 1,186,250
Netscape Communications Corp. (b) 80,000 7,040,000
Oak Technology, Inc. (b) 60,000 3,285,000
Premenos Technology Corp. (b) 50,000 1,962,500
Remedy Corp. (b) 25,000 1,075,000
Symantec Corp. (b) 70,000 1,701,875
UUNET Technologies, Inc. (b) 85,000 5,163,750
Verity, Inc. (b) 110,000 4,042,500
---------
36,036,000
---------
Diversified Financial Services--2.1%
CMAC Investment Corp. 20,000 950,000
MGIC Investment Corp. 40,000 2,275,000
Money Store, Inc. 15,000 600,000
---------
3,825,000
---------
Electronics--8.8%
BMC Industries, Inc. 75,000 2,896,875
C-Cube Microsystems, Inc. (b) 60,000 4,147,500
ESS Technology, Inc. (b) 100,000 3,000,000
ITI Technologies, Inc. (b) 58,500 1,477,125
LSI Logic Corp. (b) 25,000 1,178,125
Novellus Systems, Inc. (b) 50,000 3,443,750
---------
16,143,375
---------
Entertainment, Leisure & Gaming--3.0%
New World Communications Group, Inc.
(b) 200,000 3,300,000
Regal Cinemas, Inc. (b) 55,000 2,158,750
---------
5,458,750
---------
Healthcare--Diversified--0.6%
Oxford Health Plans (b) 15,000 1,173,750
---------
Healthcare--Drugs--7.6%
Amylin Pharmaceuticals, Inc. (b) 150,000 1,106,250
Dura Pharmaceuticals, Inc. (b) 120,000 3,510,000
Gilead Sciences, Inc. (b) 75,000 1,462,500
Liposome Company, Inc. (b) 200,000 3,075,000
Magainin Pharmaceuticals, Inc. (b) 250,000 2,031,250
Watson Pharmaceuticals, Inc. (b) 60,000 2,685,000
---------
13,870,000
---------
Hospital Management & Services--2.9%
Healthsource, Inc. (b) 20,000 $ 1,060,000
PhyCor, Inc. (b) 30,000 1,102,500
United Dental Care, Inc. (b) 100,000 3,050,000
---------
5,212,500
---------
Medical Products & Supplies--2.4%
Ostex International, Inc. (b) 125,000 2,500,000
Ventritex, Inc. (b) 100,000 1,962,500
---------
4,462,500
---------
Oil--1.6%
DLB Oil & Gas, Inc. (b) 150,000 1,331,250
Texas Meridian Resources Corp. (b) 150,000 1,631,250
---------
2,962,500
---------
Oil Service & Equipment--1.5%
ENSCO International, Inc. (b) 150,000 2,531,250
---------
Pollution Control--1.1%
U.S.A. Waste Services, Inc. (b) 100,000 2,100,000
---------
Professional Services--1.9%
Fritz Cos., Inc. (b) 100,000 3,500,000
---------
Publishing, Broadcasting, Printing & Cable--12.4%
American Radio Systems Corp. (b) 125,000 2,812,500
Clear Channels Communications, Inc. (b) 40,000 3,280,000
Evergreen Media Corp. (b) 200,000 5,450,000
Infinity Broadcasting Corp. (b) 150,000 4,875,000
Lin Television Corp. (b) 65,000 1,860,625
Renaissance Communication Corp. (b) 75,000 1,678,125
Silver King Communications (b) 50,000 1,462,500
Sinclair Broadcasting Group, Inc. (b) 60,000 1,245,000
---------
22,663,750
---------
Retail--2.9%
Staples, Inc. (b) 75,000 1,996,875
Sunglass Hut International (b) 120,000 3,270,000
---------
5,266,875
---------
Retail--Drug--2.0%
General Nutrition Companies, Inc. (b) 150,000 3,731,250
---------
Telecommunications Equipment--12.7%
Active Voice Corp. (b) 84,000 2,205,000
Ascend Communications, Inc. (b) 80,000 5,200,000
Bay Networks, Inc. (b) 50,000 3,312,500
Cascade Communications Corp. (b) 30,000 2,137,500
cisco Systems, Inc. (b) 30,000 2,325,000
Natural Microsystems Corp. (b) 80,000 1,980,000
3Com Corp. (b) 70,000 3,290,000
U.S. Robotics Corporation 30,000 2,775,000
---------
23,225,000
---------
Textile & Apparel--6.1%
Nautica Enterprises, Inc. (b) 100,000 3,425,000
Nine West Group, Inc. (b) 60,000 2,670,000
Quiksilver, Inc. (b) 75,000 2,325,000
Tommy Hilfiger Corp. (b) 70,000 2,668,750
---------
11,088,750
---------
<PAGE>
VALUE
--------------
TOTAL COMMON STOCKS
(Identified cost $146,175,189) $ 172,282,500
------------
TOTAL LONG-TERM INVESTMENTS--94.3%
(Identified cost $146,175,189) 172,282,500
------------
NUMBER
OF
CONTRACTS
--------
OPTIONS--2.9%
Russell 2000 Index Put Option March 315 (b) 1,800 3,375,000
S&P 400 Midcap Option March 225 (b) 1,000 1,387,500
S&P 500 March Puts 575 (b) 400 460,000
--------
TOTAL OPTIONS
(Identified cost $3,417,080) 5,222,500
--------
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
-------- ------ -------------
SHORT-TERM
OBLIGATIONS--2.9%
Commercial Paper--2.9%
Mobil 5.85%, 11-1-95 A-1+ $ 5,360 $ 5,360,000
-----------
TOTAL SHORT-TERM
OBLIGATIONS
(Identified cost $5,360,000) 5,360,000
-----------
TOTAL INVESTMENTS--100.1%
(Identified cost $154,952,269) 182,865,000(a)
Cash & receivables, less liabilities--(0.1%) (184,513)
-----------
NET ASSETS--100.0% $182,680,487
===========
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $29,299,134 and gross
depreciation of $3,682,898 for income tax purposes. At October 31, 1995,
the aggregate cost of securities for federal income tax purposes was
$157,248,764.
(b) Non-income producing.
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1995
Assets
Investment securities at value
(Identified cost $154,952,269) $182,865,000
Cash 3,190
Receivables
Investment securities sold 2,888,050
Fund shares sold 266,579
Dividends 5,500
-----------
Total assets 186,028,319
-----------
Liabilities
Payables
Investment securities purchased 3,048,524
Fund shares repurchased 66,317
Investment advisory fee 104,515
Distribution fee 38,653
Financial agent fee 4,480
Transfer agent fee 45,500
Trustees' fee 4,718
Accrued expenses 35,125
-----------
Total liabilities 3,347,832
-----------
Net Assets $182,680,487
===========
Net Assets Consist of:
Capital paid in on shares of beneficial interest $132,432,047
Undistributed net investment income 230,621
Accumulated net realized gains 22,105,088
Net unrealized appreciation 27,912,731
-----------
Net Assets $182,680,487
===========
Class A
Shares of beneficial interest outstanding,
$1 par value, unlimited authorization
(Net Assets $180,287,533) 10,919,811
Net asset value per share $16.51
Offering price per share
$16.51/(1-4.75%) $17.33
Class B
Shares of beneficial interest outstanding,
$1 par value, unlimited authorization
(Net Assets $2,392,954) 146,119
Net asset value and offering price per share $16.38
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1995
Investment Income
Dividends $ 630,587
Interest 1,937,305
---------
Total Investment Income 2,567,892
---------
Expenses
Investment advisory fee 1,052,902
Distribution fee--Class A 373,486
Distribution fee--Class B 10,202
Financial agent fee 45,124
Transfer agent 299,715
Registration 39,123
Custodian 35,593
Printing 31,482
Professional 27,866
Trustees 16,250
Miscellaneous 10,285
---------
Total Expenses 1,942,028
---------
Net Investment Income 625,864
---------
Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain on securities 22,388,865
Net unrealized appreciation on investments 23,926,580
---------
Net gain on investments 46,315,445
---------
Net increase in net assets resulting from operations $46,941,309
=========
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
October 31, October 31,
1995 1994
------------- ---------------
From Operations
Net investment income $ 625,864 $ 2,811,816
Net realized gain 22,388,865 8,997,579
Net unrealized appreciation
(depreciation) 23,926,580 (11,282,180)
----------- -------------
Increase in net assets resulting
from operations 46,941,309 527,215
----------- -------------
From Distributions to Shareholders
Net investment income--Class A (1,906,874) (2,191,581)
Net investment income--Class B (6,562) --
Net realized gains--Class A (9,109,368) (10,802,703)
Net realized gains--Class B (33,032) --
----------- -------------
Decrease in net assets from
distributions to shareholders (11,055,836) (12,994,284)
----------- -------------
From Share Transactions
Class A
Proceeds from sales of shares
(4,239,236 and 4,129,589 shares,
respectively) 62,165,020 55,468,458
Net asset value of shares issued
from reinvestment of
distributions
(857,273 and 898,834 shares,
respectively) 10,298,375 12,084,147
Cost of shares repurchased
(4,688,495 and 4,341,161 shares,
respectively) (67,901,061) (57,979,171)
----------- -------------
Total 4,562,334 9,573,434
----------- -------------
Class B
Proceeds from sales of shares
(152,973 and 24,793 shares,
respectively) 2,285,062 326,217
Net asset value of shares issued
from reinvestment of
distributions
(3,215 and 0 shares,
respectively) 38,454 --
Cost of shares repurchased (34,861
and 1 shares, respectively) (558,289) (10)
----------- -------------
Total 1,765,227 326,207
----------- -------------
Increase in net assets from share
transactions 6,327,561 9,899,641
----------- -------------
Net increase (decrease) in net
assets 42,213,034 (2,567,428)
Net Assets
Beginning of period 140,467,453 143,034,881
----------- -------------
End of period (including
undistributed net investment
income of $230,621 and
$1,512,086, respectively) $182,680,487 $140,467,453
=========== =============
<PAGE>
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
Class A
-----------------------------------------------------
Year Ended October 31,
1995 1994 1993 1992 1991
------- ------- ------- ------- ---------
Net asset value,
beginning of
period $13.33 $14.56 $13.56 $14.88 $10.77
Income from
investment
operations((5))
Net investment
income 0.06((4)) 0.27 0.22 0.23 0.23
Net realized and
unrealized (loss)
gain 4.21 (0.21) 1.62 0.59 4.05
------ ------ ------ ------ -------
Total from
investment
operations 4.27 0.06 1.84 0.82 4.28
------ ------ ------ ------ -------
Less distributions
Dividends from net
investment income (0.19) (0.22) (0.23) (0.25) (0.17)
Dividends from net
realized gains (0.90) (1.07) (0.61) (1.50) --
Distributions in
excess of
accumulated
realized gains -- -- -- (0.39) --
------ ------ ------ ------ -------
Total
distributions (1.09) (1.29) (0.84) (2.14) (0.17)
------ ------ ------ ------ -------
Change in net asset
value 3.18 (1.23) 1.00 (1.32) 4.11
------ ------ ------ ------ -------
Net asset value, end
of period $16.51 $13.33 $14.56 $13.56 $14.88
====== ====== ====== ====== =======
Total return((1)) 35.14% 0.37% 14.15% 7.11% 39.99%
Ratios/supplemental
data:
Net assets, end of
period (thousands) $180,288 $140,137 $143,035 $128,530 $125,942
Ratio to average net
assets of:
Operating expenses 1.29% 1.26% 1.17% 1.25% 1.20%
Net investment
income (loss) 0.43% 1.97% 1.58% 1.70% 1.68%
Portfolio turnover 331% 306% 192% 251% 332%
Class B
-------------------------------
From
Inception
7/21/94 to
1995 10/31/94
------------- --------------
Net asset value,
beginning of
period $13.31 $13.09
Income from
investment
operations((5))
Net investment
income (0.12)((4)) 0.02
Net realized and
unrealized (loss)
gain 4.26 0.20
----------- -------------
Total from
investment
operations 4.14 0.22
----------- -------------
Less distributions
Dividends from net
investment income (0.17) --
Dividends from net
realized gains (0.90) --
Distributions in
excess of
accumulated
realized gains -- --
----------- -------------
Total
distributions (1.07) --
----------- -------------
Change in net asset
value 3.07 0.22
----------- -------------
Net asset value, end
of period $16.38 $13.31
=========== =============
Total return((1)) 34.15% 1.68%((3))
Ratios/supplemental
data:
Net assets, end of
period (thousands) $2,393 $330
Ratio to average net
assets of:
Operating expenses 2.04% 1.81%((2))
Net investment
income (loss) (0.83%) 1.45%((2))
Portfolio turnover 331% 306%
((1)) Maximum sales load is not reflected in the total return calculation.
((2)) Annualized
((3)) Not annualized
((4)) Computed using average shares outstanding.
((5)) Distributions are made in accordance with the prospectus; however,
class level per share income from investment operations may vary from
anticipated results depending on the timing of share purchases and
redemptions.
<PAGE>
HIGH YIELD FUND SERIES
INVESTMENT ADVISER'S REPORT
Phoenix High Yield Fund ended its fiscal year with solid results. For the
twelve months ended October 31, 1995, the Class A shares provided a total
return of 11.19% and Class B shares returned 10.44%. As measured by the CS
First Boston High Yield Index, the market returned 15.24% for the same
period. All of these figures assume reinvestment of any distributions but
exclude the effect of sales charges. The Fund's relative underperformance
stemmed primarily from its significant weighting in the emerging debt markets
early in the year.
The poor performance of the emerging markets sector in the first quarter of
the fiscal year was due primarily to the financial crisis in Mexico. This
sector has subsequently recovered, and while a negative pull on this fiscal
year's returns, has greatly enhanced 1995 year-to-date results. Currently,
the Fund is focusing its foreign investments on dollar-denominated emerging
markets securities and Canadian issues. Domestically, we are finding good
value in the health care, telecommunications, and cable television
industries. Overall, the domestic high-yield market continues to be one of
the better performers in the fixed-income market.
Looking forward, we continue to focus on better quality domestic high-yield
issues. Presently, almost one half of the portfolio is rated "Ba" or better
by Moody's. We are stressing better quality credits for several important
reasons: uncertainty about the direction of the domestic economy, the sharp
decline in the credit quality of the new issue market, and an increasing
number of defaults in the high-yield universe. While our move to upgrade the
credit quality of the portfolio was somewhat early, we now appear to be
benefiting from a substantial movement to more defensive and better rated
high-yield credits. We also remain strongly committed to the emerging debt
markets, believing that this sector will outperform the domestic high-yield
sector in the coming year.
INVESTOR PROFILE
Phoenix High Yield Fund is best suited for risk-tolerant investors seeking a
long-term investment to provide for high current income. High-yield
fixed-income securities generally are subject to greater market fluctuations
and risk of loss of income and principal than are investments in
lower-yielding fixed-income securities. Foreign investing involves special
risks, such as currency fluctuations, less public disclosure as well as
economic and political risks.
See Notes to Financial Statements
<PAGE>
======================================LINE CHART===============================
High-Yield First Boston
Fund-- High Yield
Class A Index*
1985 9525 10000
1986 11500 12218
1987 11236 12214
1988 13227 14650
1989 13312 14870
1990 12648 13547
1991 16033 19660
1992 18643 22688
1993 22722 27008
1994 22138 27454
1995 24615 31638
Average Annual Total Returns for Periods Ending 10/31/95
From Inception
2/16/94 to
1 Year 5 Years 10 Years 10/31/95
- --------------------------------------------------------------------------------
Class A with 4.75% sales charge 5.96% 13.10% 9.42% --
- --------------------------------------------------------------------------------
Class A at net asset value 11.19% 14.22% 9.94% --
- --------------------------------------------------------------------------------
Class B with CDSC 4.62% -- -- 1.34%
- --------------------------------------------------------------------------------
Class B at net asset value 10.44% -- -- 1.15%
- --------------------------------------------------------------------------------
First Boston High Yield Index* 15.24% 18.49% 12.28% 7.11%
===============================================================================
This chart assumes an initial gross investment of $10,000 made on 10/31/85
for Class A shares. The total return for Class A shares reflects the maximum
sales charge of 4.75% on the initial investment and assumes reinvestment of
dividends and capital gains. Class B share performance will be greater or
less than that shown based on differences in inception dates, fees and sales
charges. The total return (since inception 2/16/94) for Class B shares
reflects the 5% contingent deferred sales charge (CDSC), which is applicable
on all shares redeemed during the 1st year after purchase and 4% for all
shares redeemed during the 2nd year after purchase (scaled down to 3%--3rd
year; 2%--4th and 5th year and 0% thereafter). Returns indicate past
performance, which is not predictive of future performance. Investment return
and principal value will fluctuate, so that your shares, when redeemed, may
be worth more or less than the original cost.
*The First Boston High Yield Index is an unmanaged but commonly used index
that tracks the returns of all new publicly offered debt of more than $75
million rated below BBB or BBB/BB+. The index's performance does not reflect
sales charges.
<PAGE>
INVESTMENTS AT OCTOBER 31, 1995
MOODY'S
BOND PAR
RATING VALUE
(Unaudited) (000) VALUE
-------- ------- -------------
U.S. GOVERNMENT SECURITIES--2.1%
U.S. Treasury Bonds--2.1%
U.S. Treasury Bonds 6.50%, '05 Aaa $ 10,500 $ 10,874,063
-----------
TOTAL U.S. GOVERNMENT SECURITIES
(Identified cost $10,755,938) 10,874,063
-----------
NON-CONVERTIBLE BONDS--60.6%
Airlines--3.2%
GPA Delaware, Inc. 8.75%, '98 Caa 18,500 16,557,500
-----------
Building & Materials--1.5%
Overhead Door Corp. 12.25%, '00 B 8,000 7,910,000
-----------
Chemical--Specialty--2.0%
Borden Chemical & Plastics 9.50%,
'05 Ba 10,000 10,300,000
-----------
Containers--3.3%
Owens-Illinois, Inc. 11%, '03 Ba 11,000 12,223,750
Portola Packaging, Inc. 10.75%,
'05 B 5,000 5,125,000
-----------
17,348,750
-----------
Food--2.0%
Curtice-Burns Foods, Inc. 12.25%,
'05 B 9,750 10,335,000
-----------
Hospital Management & Services--6.6%
Community Health Systems 10.25%,
'03 B 9,600 10,284,000
Healthsouth Rehabilitation 9.50%,
'01 Ba 1,875 1,996,875
Tenet Healthcare Corp. 10.125%,
'05 Ba 20,250 21,920,625
-----------
34,201,500
-----------
Machinery--1.5%
Cincinnati Milacron, Inc. 8.375%,
'04 Ba 7,500 7,747,650
-----------
Metals & Mining--1.0%
AK Steel Corp. 10.75%, '04 Ba 5,000 5,462,500
-----------
Non-Agency Mortgage-Backed Securities--7.3%
Chase Mtg. Finance Corp. 93-2, B8
6.95%, '24 (g) BB((c)) 4,437 3,505,478
DLJ Mortgage Acceptance Corp.
94-MF4 B2 8.50%, '01 BB((c)) 3,000 2,725,313
Merrill Lynch Mtg. 144A 94-M1, E
8.23%, '22 (b) Ba 4,000 3,562,500
Prudential Home Mortgage Security
Corp. 92-29, B3 8%, '22 Ba 6,147 5,578,787
Resolution Trust Corp. 95-2, C1
7.45%, '29 Baa 3,329 3,245,775
Resolution Trust Corp. 95-2, B2
7%, '29 Baa 6,731 6,465,967
Ryland Mortgage Security Corp. III
92-A IC 8.33%, '30 BB((c)) $ 1,000 $ 800,313
Salomon Brothers Mtg. 1995-C B1
144A 6.801%, '08 (b) B((c)) 9,845 7,395,976
SML, Inc. 94-C1, B2 10.30%, '99 BB((c)) 5,000 4,875,000
-----------
38,155,109
-----------
Office & Business Equipment--1.7%
United Stationer Supply 12.75%,
'05 B 8,500 9,095,000
-----------
Oil--1.6%
Crown Central Petroleum 10.875%,
'05 Ba 8,000 8,420,000
-----------
Paper & Forest Products--1.5%
Repap New Brunswick Yankee
10.625%, '05 B 3,000 3,082,500
SD Warren Co. Series B 12%, '04 B 4,250 4,728,125
-----------
7,810,625
-----------
Pollution Control--0.8%
Clean Harbors, Inc. 12.50%, '01 B 5,000 4,100,000
-----------
Publishing, Broadcasting, Printing & Cable--11.5%
Alliance Entertainment 144A
11.25%, '05 (b) B((c)) 3,000 3,026,250
Continental Cablevision 9.50%, '13 Ba 5,700 6,027,750
Galaxy Telecom L.P. 12.375%, '05 B 8,000 7,990,000
New World Communications Group-B
0%, '99 Caa 7,000 4,725,000
Paramount Communications 8.25%,
'22 Ba 8,000 8,067,440
SCI Television 11%, '05 B 15,800 16,846,750
Sinclair Broadcast Group 10%, '05 B 8,000 8,220,000
Univision 0%, '02 NR 8,546 5,052,926
-----------
59,956,116
-----------
Retail--2.2%
Eyecare Centers of America 144A
12%, '03 (b) B 6,500 5,533,125
Grand Union Co. 12%, '04 B 2,500 2,425,000
Scotty's, Inc. Series A, 11.25%,
'15 NR 3,200 3,204,000
-----------
11,162,125
-----------
Telecommunications Equipment--6.6%
Celcarib SA 144A Unit, 0%, '04
(b)(f) NR 6,000 5,190,000
Commnet Cellular 11.25%, '05 Caa 4,000 4,140,000
IntelCom Group Unit 144A 0%, '05
(b)(f) NR 6,500 3,656,250
Paging Network 10.125%, '07 B 4,000 4,260,000
<PAGE>
Telecommunications Equipment--continued
Panamsat L.P. 0%, '03 (f) B $ 14,400 $ 11,448,000
USA Mobile Communications 14%, '04 B 3,500 4,033,750
Viatel, Inc. 0%, '05 (f) NR 3,500 1,837,500
-----------
34,565,500
-----------
Textile & Apparel--1.8%
Polymer Group 144A 12.75%, '02 (b) Caa 8,850 9,115,500
-----------
Utility--Electric--4.5%
AES Corp. 9.75%, '00 Ba 8,000 8,220,000
California Energy 9.875%, '03 Ba 5,000 5,150,000
California Energy 0%, '04 (f) Ba 11,000 9,927,500
-----------
23,297,500
-----------
TOTAL NON-CONVERTIBLE BONDS
(Identified cost $307,380,302) 315,540,375
-----------
FOREIGN NON-CONVERTIBLE BONDS--18.9%
Argentina--2.8%
Bridas Corp. 12.50%, '99 B 11,500 10,968,125
Transport De Gas 144A 7.75%, '98
(b) B 4,250 3,793,125
-----------
14,761,250
-----------
Brazil--2.6%
Aracruz Cellulose 144A 10.375%,
'02 (b) NR 9,000 8,505,000
Companhia Brasil de Projetos 144A
12.50%, '97 (b) NR 5,000 4,962,500
-----------
13,467,500
-----------
Canada--3.8%
Call-Net Enterprises 0%,
'04 (f) B 12,000 8,565,000
Groupe Videotron Ltee 10.625%, '05 Ba 4,000 4,230,000
Videotron Ltd. 10.25%, '02 Ba 6,500 6,808,750
-----------
19,603,750
-----------
Columbia--2.2%
Centragas 144A 10.65%, '10 (b) BBB((c)) 11,000 11,632,500
-----------
Indonesia--1.5%
P.T. Polysindo 13%, '01 B 7,500 7,837,500
-----------
Mexico--2.0%
Ispat Mexicana 144A 10.375%, '01
(b) NR 10,000 8,800,000
Ispat Mexicana SA Euro 10.375%,
'01 NR 2,000 1,760,000
-----------
10,560,000
-----------
Peru--2.1%
Compagnie Bancaire USA Funding MTN
144A 0%, '96 (b) Aa 12,104 10,742,300
-----------
Philippines--0.7%
Subic Power Corp. 144A 9.50%, '08
(b) NR $ 4,190 $ 3,917,579
-----------
United Kingdom--1.2%
Videotron PLC 0%, '04 (f) B 9,000 6,030,000
-----------
TOTAL FOREIGN NON-CONVERTIBLE BONDS
(Identified cost $98,884,505) 98,552,379
-----------
FOREIGN GOVERNMENT SECURITIES--13.4%
Argentina--2.4%
Republic of Argentina Bear FRB
6.8125%, '05 (f) B 12,500 7,445,312
Republic of Argentina Par L-GP 5%,
'23 (f) B 11,000 5,259,375
-----------
12,704,687
-----------
Brazil--2.8%
Republic of Brazil El-L Euro
6.8125%, '06 (f) NR 11,500 7,640,313
Republic of Brazil Par Z-L Euro
4.25%, '24 (f) NR 5,000 2,428,125
Republic of Brazil 20yr, interest
capitalization Series C Euro 8%,
'14 NR 8,490 4,324,430
-----------
14,392,868
-----------
Costa Rica--1.2%
Central Bank of Costa Rica
Principal A 6.25%, '10 NR 10,200 6,171,000
-----------
Ecuador--0.9%
Republic of Ecuador PDI 20yr Euro,
Interest Capitalization, 7.25%,
'15 (f) NR 14,301 4,741,575
-----------
Mexico--2.4%
Banco National Commerciale
Exterior 7.25%, '04 Ba 5,000 3,637,500
United Mexican States Series A
Euro 6.25%, '19 (e) Ba 5,000 2,943,750
United Mexican States Series B
Euro 6.25%, '19 (e) Ba 10,000 5,887,500
-----------
12,468,750
-----------
Poland--3.7%
Poland PDI B 3.75%, '14 (f) NR 30,000 19,312,500
-----------
TOTAL FOREIGN GOVERNMENT SECURITIES
(Identified cost $60,751,936) 69,791,380
-----------
SHARES
------
PREFERRED STOCKS--2.1%
Paper & Forest Products--0.7%
SD Warren Co. Pfd. PIK 144A
Series B (b) 115,000 3,367,436
-----------
Telecommunications Equipment--1.4%
Pan Am Satellite Corp. Pfd. PIK
12.75%, '05 6,693 7,312,512
-----------
TOTAL PREFERRED STOCKS
(Identified cost $9,129,088) 10,679,948
-----------
<PAGE>
SHARES VALUE
----------- -------------
COMMON STOCKS--0.1%
Publishing, Broadcasting,
Printing & Cable--0.0%
Sullivan Holdings, Inc. Class
C (d) 76 $ 0
-----------
Telecommunications
Equipment--0.1%
Viatel, Inc. 144A (b)(d) 126,350 505,400
-----------
TOTAL COMMON STOCKS
(Identified cost $850,646) 505,400
---------
WARRANTS--0.2%
Eye Care Centers of America
Warrants (d) 6,500 32,500
Purity Supreme, Inc. Warrants
(d) 27,724 277
SD Warren Warrants 144A (b)(d) 115,000 805,000
-----------
837,777
-----------
VALUE
-----------
TOTAL WARRANTS
(Identified cost $568,100) $ 837,777
-----------
TOTAL LONG-TERM INVESTMENTS--97.4%
(Identified cost $488,320,515) 506,781,322
-----------
TOTAL INVESTMENTS--97.4%
(Identified cost $488,320,515) 506,781,322(a)
Cash & receivables, less liabilities--2.6% 13,404,694
-----------
NET ASSETS--100.0% $ 520,186,016
===========
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $31,248,538 and gross
depreciation of $10,626,519 for income tax purposes. At October 31, 1995,
the aggregate cost of securities for federal income tax purposes was
$486,159,303. At October 31, 1995, the Fund had capital loss
carryforwards for tax purposes aggregating $330,628,821 which may be used
to offset future capital gains. Of this amount, $247,265,135 was acquired
in connection with the merger of National Bond Fund into the Fund which
expire as follows: $22,486,288 through 1996; $178,352,034 through 1997;
and, $46,426,813 through 1998. The availability of these capital loss
carryforwards to offset future capital gains is subject to an annual
limitation determined under the Internal Revenue Code of 1986, as
amended. The Fund has additional capital loss carryforwards of
$83,363,686 which expire as follows: $2,286,389 through 1997; $20,045,739
through 1998; $14,103,053 through 2002; and, $46,928,505 through 2003.
(b) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At October 31,
1995, these securities amounted to a value of $94,510,441 or 18.2% of net
assets.
(c) As rated by Standard & Poor's, Duff & Phelps or Fitch
(d) Non-income producing
(e) Mexico Value Recovery Euro Rights (15,000,000 shares) incorporated as a
unit.
(f) Variable or step coupon bond; interest rate shown reflects the rate
currently in effect.
(g) Private placement; acquisition cost $4,015,770, acquisition date 8/30/93.
The Fund will bear any costs, including those involved in registration
under the Securities Act of 1933, in connection with the disposition of
such securities.
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1995
Assets
Investment securities at value
(Identified cost $488,320,515) $506,781,322
Cash 855,975
Receivables
Investment securities sold 2,458,950
Fund shares sold 522,403
Dividends and interest 10,897,631
-----------
Total assets 521,516,281
-----------
Liabilities
Payables
Fund shares repurchased 596,649
Investment advisory fee 286,152
Distribution fee 117,639
Financial agent fee 13,207
Transfer agent fee 231,511
Trustees' fee 6,304
Accrued expenses 78,803
-----------
Total liabilities 1,330,265
-----------
Net Assets $520,186,016
===========
Net Assets Consist of:
Capital paid in on shares of beneficial interest $582,877,757
Undistributed net investment income 2,426,413
Accumulated net realized loss (83,578,961)
Net unrealized appreciation 18,460,807
-----------
Net Assets $520,186,016
===========
Class A
Shares of beneficial interest outstanding,
$1 par value, unlimited authorization
(Net Assets $507,855,238) 62,128,293
Net asset value per share $8.17
Offering price per share
$8.17/(1-4.75%) $8.58
Class B
Shares of beneficial interest outstanding, $1 par
value,
unlimited authorization (Net Assets $12,330,778) 1,506,415
Net asset value and offering price per share $8.19
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1995
Investment Income
Interest $ 56,840,805
Dividends 733,103
-----------
Total Investment Income 57,573,908
-----------
Expenses
Investment advisory fee 3,336,889
Distribution fee--Class A 1,261,237
Distribution fee--Class B 88,728
Financial agent fee 154,010
Transfer agent 1,143,115
Custodian 72,236
Registration 60,129
Printing 54,880
Professional 54,688
Trustees 16,250
Miscellaneous 42,905
-----------
Total Expenses 6,285,067
-----------
Net Investment Income 51,288,841
-----------
Net Realized and Unrealized Gain (Loss) on
Investments
Net realized loss on securities (45,170,764)
Net unrealized appreciation on investments 47,776,602
-----------
Net gain on investments 2,605,838
-----------
Net increase in net assets resulting from operations $ 53,894,679
===========
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
October 31, October 31,
1995 1994
------------- --------------
From Operations
Net investment income $ 51,288,841 $ 51,831,131
Net realized loss (45,170,764) (17,866,378)
Net unrealized appreciation
(depreciation) 47,776,602 (49,152,939)
----------- -------------
Increase (decrease) in net assets
resulting from operations 53,894,679 (15,188,186)
----------- -------------
From Distributions to Shareholders
Net investment income--Class A (49,483,730) (49,858,087)
Net investment income--Class B (817,976) (204,011)
Tax return of capital--Class A -- (2,179,385)
Tax return of capital--Class B -- (8,928)
----------- -------------
Decrease in net assets from distributions
to shareholders (50,301,706) (52,250,411)
----------- -------------
From Share Transactions
Class A
Proceeds from sales of shares (9,926,312
and 8,604,443 shares, respectively) 78,513,605 75,570,434
Net asset value of shares issued from
reinvestment of distributions (3,110,460
and 2,929,843 shares, respectively) 24,479,580 25,376,952
Net asset value of shares issued from the
acquisition of National Bond Fund
(0 and 60,339,364 shares, respectively) -- 549,549,755
Cost of shares repurchased (16,450,118
and 26,352,589 shares, respectively) (130,311,090) (233,952,592)
----------- -------------
Total (27,317,905) 416,544,549
----------- -------------
Class B
Proceeds from sales of shares (915,297
and 790,792 shares, respectively) 7,282,409 6,778,305
Net asset value of shares issued from
reinvestment of distributions (36,805 and
8,195 shares, respectively) 292,115 68,334
Cost of shares repurchased (190,541 and
54,133 shares, respectively) (1,491,768) (457,539)
----------- -------------
Total 6,082,756 6,389,100
----------- -------------
(Decrease) increase in net assets from
share transactions (21,235,149) 422,933,649
----------- -------------
Net (decrease) increase in net assets (17,642,176) 355,495,052
----------- -------------
Net Assets
Beginning of period 537,828,192 182,333,140
----------- -------------
End of period (including undistributed
net investment income of $2,426,413 and
$1,393,932, respectively) $ 520,186,016 $ 537,828,192
=========== =============
<PAGE>
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
Class A
-----------------------------------------------------
Year Ended October 31,
1995 1994 1993 1992 1991
------- ------- ------- ------- ---------
Net asset value,
beginning of
period $ 8.11 $ 9.11 $ 8.14 $ 7.70 $ 6.72
Income from
investment
operations
Net investment
income 0.80 0.76 0.74 0.77 0.74
Net realized and
unrealized gain
(loss): 0.04 (0.97) 0.97 0.44 0.98
------ ------ ------ ------ -------
Total from
investment
operations 0.84 (0.21) 1.71 1.21 1.72
------ ------ ------ ------ -------
Less distributions
Dividends from net
investment income (0.78) (0.76) (0.74) (0.77) (0.74)
Tax return of
capital -- (0.03) -- -- --
------ ------ ------ ------ -------
Total
distributions (0.78) (0.79) (0.74) (0.77) (0.74)
------ ------ ------ ------ -------
Change in net asset
value 0.06 (1.00) 0.97 0.44 0.98
------ ------ ------ ------ -------
Net asset value, end
of period $ 8.17 $ 8.11 $ 9.11 $ 8.14 $ 7.70
====== ====== ====== ====== =======
Total return((1)) 11.19% -2.57% 21.87% 16.28% 26.77%
Ratios/supplemental
data:
Net assets end of
period (thousands) $507,855 $531,773 $182,333 $113,197 $91,664
Ratio to average net
assets of:
Operating expenses 1.21% 1.19% 1.04% 1.08% 1.08%
Net investment
income 10.01% 9.01% 8.46% 9.51% 10.12%
Portfolio turnover 147% 222% 157% 205% 326%
Class B
-------------------------------
Year From
Ended Inception
October 31, 2/16/94 to
1995 10/31/94
------------- --------------
Net asset value,
beginning of
period $ 8.13 $ 9.38
Income from
investment
operations
Net investment
income 0.72 0.54
Net realized and
unrealized gain
(loss): 0.07 (1.25)
----------- -------------
Total from
investment
operations 0.79 (0.71)
----------- -------------
Less distributions
Dividends from net
investment income (0.73) (0.52)
Tax return of
capital -- (0.02)
----------- -------------
Total
distributions (0.73) (0.54)
----------- -------------
Change in net asset
value 0.06 (1.25)
----------- -------------
Net asset value, end
of period $ 8.19 $ 8.13
=========== =============
Total return((1)) 10.44% -7.67%((3))
Ratios/supplemental
data:
Net assets end of
period (thousands) $12,331 $6,056
Ratio to average net
assets of:
Operating expenses 1.97% 1.80%((2))
Net investment
income 9.18% 9.12%((2))
Portfolio turnover 147% 222%
((1)) Maximum sales load is not reflected in the total return calculation.
((2)) Annualized
((3)) Not annualized
<PAGE>
U.S. GOVERNMENT SECURITIES FUND SERIES
INVESTMENT ADVISER'S REPORT
Phoenix U.S. Government Securities Fund performed solidly during this fiscal
reporting year. For the twelve months ended October 31, 1995, Class A shares
provided a total return of 14.81% and Class B shares returned 13.82%. This
result was in line with the Lehman Brothers Government Bond Index, which
returned 15.37% for the same period.
Over this reporting cycle, we maintained a consistent strategy, adjusting the
portfolio's sector allocations between mortgage-backed securities and U.S.
Treasuries. This strategy allows us to take advantage of the best values in
these two sectors over time. Currently, the Fund is overweighted in
mortgage-backed securities, which represented approximately 67% of portfolio
holdings as of October 31, 1995.
The bond market had an exceptionally strong year in 1995. While we do not
expect to see such strength in 1996, our outlook is positive. We expect to
adhere to our conservative management strategy, emphasizing the best value in
U.S. Treasury and mortgage-backed securities.
INVESTOR PROFILE
Phoenix U.S. Government Securities Fund is well suited for investors seeking
a high level of current income consistent with safety of principal.
======================================LINE CHART===============================
Lehman Brothers U.S. Government
Government Bond Securities Fund--
Index* Class A
1987 9525 10000
1987 9014 9874
1988 9997 10835
1989 10853 12138
1990 11485 12858
1991 13120 14735
1992 14398 16257
1993 15864 18392
1994 15233 17570
1995 17489 20270
Average Annual Total Returns for Periods Ending 10/31/95
From Inception From Inception
3/9/87 to 2/24/94 to
1 Year 5 Years 10/31/95 10/31/95
- --------------------------------------------------------------------------------
Class A with 4.75%
sales charge 9.39% 7.71% 6.68% --
- --------------------------------------------------------------------------------
Class A at net asset value 14.81% 8.76% 7.28% --
- --------------------------------------------------------------------------------
Class B with CDSC 8.82% -- -- 3.23%
- --------------------------------------------------------------------------------
Class B at net asset value 13.82% -- -- 5.53%
- --------------------------------------------------------------------------------
Lehman Brothers Government
Bond Index* 15.37% 9.53% 8.51% 6.90%
================================================================================
This chart assumes an initial gross investment of $10,000 made on 3/9/87 for
Class A shares. The total return for Class A shares reflects the maximum
sales charge of 4.75% on the initial investment and assumes reinvestment of
dividends and capital gains. Class B share performance will be greater or
less than that shown based on differences in inception dates, fees and sales
charges. The total return for Class B shares reflects the 5% contingent
deferred sales charge (CDSC), which is applicable on all shares redeemed
during the 1st year after purchase and 4% for all shares redeemed during the
2nd year after purchase (scaled down to 3%--3rd year; 2%--4th and 5th year
and 0% thereafter). Returns indicate past performance, which is not
predictive of future performance. Investment return and principal value will
fluctuate, so that your shares, when redeemed, may be worth more or less than
the original cost.
*The Lehman Brothers Government Bond index is an unmanaged but commonly used
measure of non-mortgaged government securities performance. The index's
performance does not reflect sales charges.
<PAGE>
INVESTMENTS AT OCTOBER 31, 1995
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
-------- -------- -------------
U.S. GOVERNMENT
SECURITIES--95.5%
U.S. Treasury Bonds--7.3%
U.S. Treasury Bonds 7.125%, '23 AAA $ 16,000 $ 17,431,360
-----------
U.S. Treasury Notes--20.9%
U.S. Treasury Notes 5.625%, '97 AAA 15,000 15,004,665
U.S. Treasury Notes 6.50%, '97 AAA 17,000 17,246,500
U.S. Treasury Notes 5.125%,
'98 AAA 13,000 12,781,340
U.S. Treasury Notes 5.875%, '98 AAA 5,000 5,021,750
-----------
50,054,255
-----------
Agency Mortgage-Backed
Securities--67.3%
FHLMC 9.30%, '05 AAA 1,147 1,164,899
FHLMC 6.75%, '19 AAA 1,500 1,501,875
FNMA 10%, '04 AAA 5,000 5,318,150
FNMA 8.70%, '16 AAA 1,569 1,616,694
FNMA 5.85%, '17 AAA 5,000 4,900,650
FNMA 6.65%, '17 AAA 1,500 1,493,489
FNMA 6.50%, '18 AAA 1,500 1,484,024
Agency Mortgage-Backed
Securities--(continued)
FNMA 8.50%, '19 AAA $ 1,500 $ 1,529,865
FNMA 6.75%, '19-'22 AAA 8,442 8,404,109
FNMA 7%, '23 AAA 21,902 21,732,808
GNMA 6.50%, '23-'24 AAA 77,790 75,626,889
GNMA 8%, '05-'06 AAA 206 211,715
GNMA 8.50%, '01-'22 AAA 723 754,781
GNMA 9%, '24-'25 AAA 33,826 35,545,559
-----------
161,285,507
-----------
TOTAL U.S. GOVERNMENT SECURITIES
(Identified cost $227,944,264) 228,771,122
-----------
SHORT-TERM OBLIGATIONS--4.0%
Federal Agency Securities--4.0%
Federal Home Loan Banks, 5.82%, 11-1-95 9,545 9,545,000
-----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $9,545,000) 9,545,000
-----------
TOTAL INVESTMENTS--99.5%
(Identified cost $237,489,264) 238,316,122((a))
Cash & receivables, less liabilities--0.5% 1,217,702
-----------
NET ASSETS--100.0% $239,533,824
===========
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $1,704,714 and gross
depreciation of $877,856 for income tax purposes. At October 31, 1995,
the aggregate cost of securities for federal income tax purposes was
$237,489,264. At October 31, 1995, the Fund had capital loss
carryforwards for tax purposes aggregating $44,091,871 which may be used
to offset future capital gains. Of this amount $35,407,292 was acquired
in connection with the merger of National Federal Securities Trust Fund
into the Fund which expire as follows: $19,668,129 through 1996;
$13,922,859 through 1997; and, $1,816,304 through 1998. The availability
of these capital loss carryforwards to offset future capital gains is
subject to an annual limitation determined under the Internal Revenue
Code of 1986, as amended. The Fund has additional capital loss
carryforwards of $8,684,579 which expires in 2002.
See Notes to Financial Statements
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1995
Assets
Investment securities at value
(Identified cost $237,489,264) $238,316,122
Cash 4,655
Receivables
Fund shares sold 35,369
Interest 1,743,515
-----------
Total assets 240,099,661
-----------
Liabilities
Payables
Fund shares repurchased 281,302
Investment advisory fee 91,958
Distribution fee 53,383
Financial agent fee 6,130
Transfer agent fee 78,751
Trustees' fee 4,520
Accrued expenses 49,793
-----------
Total liabilities 565,837
-----------
Net Assets $239,533,824
===========
Net Assets Consist of:
Capital paid in on shares of beneficial interest $247,391,545
Accumulated net realized losses (8,684,579)
Net unrealized appreciation 826,858
-----------
Net Assets $239,533,824
===========
Class A
Shares of beneficial interest outstanding,
$1 par value, unlimited authorization
(Net Assets $235,878,921) 24,566,975
Net asset value per share $9.60
Offering price per share
$9.60/(1-4.75%) $10.08
Class B
Shares of beneficial interest outstanding,
$1 par value, unlimited authorization
(Net Assets $3,654,903) 381,535
Net asset value and offering price per share $9.58
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1995
Investment Income
Interest $17,692,633
----------
Total Investment Income 17,692,633
----------
Expenses
Investment advisory fee 1,137,873
Distribution fee--Class A 625,568
Distribution fee--Class B 26,334
Financial agent fee 75,858
Transfer agent 526,095
Custodian 29,278
Registration 28,885
Professional 20,213
Trustees 16,250
Printing 15,410
Miscellaneous 10,878
----------
Total Expenses 2,512,642
----------
Net Investment Income 15,179,991
----------
Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain on securities 4,645,956
Net unrealized appreciation on investments 15,291,582
----------
Net gain on investments 19,937,538
----------
Net increase in net assets resulting from operations $35,117,529
==========
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
October 31, October 31,
1995 1994
------------- ---------------
From Operations
Net investment income $ 15,179,991 $ 16,222,097
Net realized gain (loss) 4,645,956 (11,416,977)
Net unrealized appreciation
(depreciation) 15,291,582 (15,475,350)
----------- -------------
Increase (decrease) in net assets
resulting from operations 35,117,529 (10,670,230)
----------- -------------
From Distributions to Shareholders
Net investment income--Class A (14,898,311) (13,246,429)
Net investment income--Class B (135,148) (19,429)
Distributions in excess of net
investment income--Class A (124,677) --
Distributions in excess of net
investment income--Class B (1,132) --
Net realized gains--Class A -- (92,260)
Tax return of capital--Class A -- (4,146,589)
Tax return of capital--Class B -- (6,082)
----------- -------------
Decrease in net assets from
distributions to shareholders (15,159,268) (17,510,789)
----------- -------------
From Share Transactions
Class A
Proceeds from sales of shares
(1,623,549 and 2,393,248 shares,
respectively) 14,794,526 22,709,766
Net asset value of shares issued
from reinvestment of
distributions (853,155 and
979,043 shares, respectively) 7,809,721 9,084,714
Net asset value of shares issued
from the acquisition of National
Federal Securities Trust (0 and
28,739,914 shares, respectively) -- 279,879,250
Cost of shares repurchased
(7,434,464 and 8,370,065 shares,
respectively) (68,623,281) (78,447,389)
----------- -------------
Total (46,019,034) 233,226,341
----------- -------------
Class B
Proceeds from sales of shares
(351,124 and 146,592 shares,
respectively) 3,208,563 1,340,909
Net asset value of shares issued
from reinvestment of
distributions (6,855 and 1,065
shares, respectively) 63,105 9,600
Cost of shares repurchased
(116,132 and 7,969 shares,
respectively) (1,072,281) (72,852)
----------- -------------
Total 2,199,387 1,277,657
----------- -------------
(Decrease) increase in net assets
from share transactions (43,819,647) 234,503,998
----------- -------------
Net (decrease) increase in net
assets (23,861,386) 206,322,979
Net Assets
Beginning of period 263,395,210 57,072,231
----------- -------------
End of period (including
undistributed net investment
income of $0 and $0,
respectively) $239,533,824 $263,395,210
=========== =============
<PAGE>
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
Class A
-----------------------------------------------------
Year Ended October 31,
1995 1994 1993 1992 1991
------- ------- ------- ------- ---------
Net asset value,
beginning of
period $ 8.88 $ 9.87 $ 9.91 $ 9.65 $ 9.08
Income from
investment
operations
Net investment
income 0.55 0.64 0.62((1)) 0.65((1)) 0.68((1))
Net realized
and unrealized
gain (loss) 0.72 (1.02) 0.34 0.26 0.57
------ ------ ------ ------ -------
Total from
investment
operations 1.27 (0.38) 0.96 0.91 1.25
------ ------ ------ ------ -------
Less
distributions
Dividends from
net investment
income (0.55) (0.45) (0.62) (0.65) (0.68)
Dividends from
net realized
gains -- (0.02) (0.38) -- --
Tax return of
capital -- (0.14) -- -- --
------ ------ ------ ------ -------
Total
distributions (0.55) (0.61) (1.00) (0.65) (0.68)
------ ------ ------ ------ -------
Change in net
asset value 0.72 (0.99) (0.04) 0.26 0.57
------ ------ ------ ------ -------
Net asset value,
end of period $ 9.60 $ 8.88 $ 9.87 $ 9.91 $ 9.65
====== ====== ====== ====== =======
Total
return((2)) 14.81% -3.98% 10.18% 9.74% 14.24%
Ratios/supplemental
data:
Net assets, end
of period
(thousands) $235,879 $262,157 $57,072 $40,365 $22,123
Ratio to average
net assets of:
Operating
expenses 0.99% 0.98% 0.75% 0.77% 0.97%
Net investment
income 6.01% 5.92% 6.19% 6.64% 7.20%
Portfolio
turnover 178% 101% 264% 285% 130%
Class B
-------------------------------
Year From
Ended Inception
October 31, 2/24/94 to
1995 10/31/94
------------- --------------
Net asset value,
beginning of
period $ 8.86 $ 9.61
Income from
investment
operations
Net investment
income 0.48 0.39
Net realized
and unrealized
gain (loss) 0.72 (0.75)
----------- -------------
Total from
investment
operations 1.20 (0.36)
----------- -------------
Less
distributions
Dividends from
net investment
income (0.48) (0.30)
Dividends from
net realized
gains -- --
Tax return of
capital -- (0.09)
----------- -------------
Total
distributions (0.48) (0.39)
----------- -------------
Change in net
asset value 0.72 (0.75)
----------- -------------
Net asset value,
end of period $ 9.58 $ 8.86
=========== =============
Total
return((2)) 13.82% -3.83%((4))
Ratios/supplemental
data:
Net assets, end
of period
(thousands) $3,655 $1,238
Ratio to average
net assets of:
Operating
expenses 1.73% 2.00%((3))
Net investment
income 5.23% 4.49%((3))
Portfolio
turnover 178% 101%
((1)) Includes reimbursement of operating expenses by investment adviser of
$0.03, $0.04 and $0.01, respectively.
((2)) Maximum sales load is not reflected in the total return calculation.
((3)) Annualized
((4)) Not annualized
<PAGE>
MONEY MARKET FUND SERIES
INVESTMENT ADVISER'S REPORT
Phoenix Money Market Fund performed solidly over the twelve months ended
October 31, 1995. The current yield of Class A shares on October 31 was
5.10%, as compared with the 5.17% average yield of taxable money market funds
reported by Donoghue's Money Fund Report. The current yield is a seven-day
annualized yield computed by dividing the average net investment income
earned per share during the seven-day period preceding the date of
calculation by the average daily net asset value per share for the same
period, with the resulting figure multiplied by 365.
The short-term market saw little activity from the Federal Reserve Board over
the second half of this fiscal year. After nearly three years of restrictive
policy, the Fed cut the Federal Funds rate to 5.75% from 6.00% early in July.
Yet despite increasing concerns about the economy and the Federal budget
deficit, the Fed has since remained on the sidelines. Once the budget
problems are resolved, however, most observers expect the Fed to begin easing
again.
In anticipation of the Fed's easing, we continue to look for opportunities to
extend portfolio maturities where appropriate. We are also maintaining our
focus on floating-rate securities, which have been strong contributors to the
portfolio over this reporting period.
FEATURES
Your investment in the Money Market Fund earns a high return with the benefit
of the following features.
Daily Yield Information--Our 7-day yield is published in various newspapers
including the Wall Street Journal. It is also obtainable by calling us
toll-free at 800-243-1574.
Expedited Investments--If you would like to start your money working
immediately, you may arrange to purchase shares by wiring Federal Funds. Your
account is credited upon receipt of such funds.
Invest-By-Phone--By using the Invest-By-Phone option, you can transfer money
between your bank account and your Money Market account. This convenient
feature may be used for purchases or redemptions which flow through a
commercial bank, savings bank or credit union which is a member of the
Automated Clearing House.
Free Checkwriting--We'll supply you with an unlimited amount of checks which
you can write against your account. You continue to earn dividends until your
check clears.
Monthly Distributions--Dividends are paid on a monthly basis. You may elect
to have your dividends paid to you or to whomever you designate or your
dividend may be reinvested to purchase additional shares.
INVESTOR PROFILE
Investors seeking high current income with high liquidity are best suited for
this Fund. Phoenix Money Market Fund is neither insured nor guaranteed by the
U.S. government, and there can be no assurance the Fund will be able to
maintain a stable net asset value of $1.00 per share.
======================================LINE CHART===============================
Donoghue
Money Market Money Market
Fund--Class A Fund Report*
11/94 4.45 4.57
12/94 4.91 5.02
1/95 5.21 5.20
2/95 5.49 5.41
3/95 5.86 5.48
4/95 5.47 5.49
5/95 5.61 5.46
6/95 5.50 5.43
7/95 5.46 5.33
8/95 5.38 5.23
9/95 5.32 5.19
10/95 5.10 5.17
================================================================================
The above graph covers the period from October 31, 1994 to October 31, 1995.
The results are not indicative of the rate of return which may be realized
from an investment made in the Money Market Fund today. The Money Market Fund
Series is neither insured nor guaranteed by the U.S. Government, and there
can be no assurance the Fund will be able to maintain a stable Net Asset
Value at $1.00 per share.
*Average monthly yield of taxable Money Market Funds as reported by
Donoghue's Money Fund Report.
See Notes to Financial Statements
<PAGE>
INVESTMENTS AT OCTOBER 31, 1995
Standard
Face & Poor's
Amount Rating Interest Maturity
(000) Description (Unaudited) Rate Date Value
---- -------------------- -------- ----- ----- -------------
FEDERAL AGENCY SECURITIES--12.4%
$3,000 Federal Farm Credit Bank 6.33% 11/01/95 $ 3,000,000
3,500 Federal Home Loan Banks 5.52 12/15/95 3,476,387
4,000 Federal National Mortgage
Assoc. 5.50 01/08/96 3,958,444
2,540 Federal Home Loan Banks 6.52 01/19/96 2,503,658
2,125 Federal Farm Credit Bank 6.52 01/26/96 2,091,902
6,000 Federal Home Loan Banks 7.15 01/26/96 6,000,227
4,000 Federal Home Loan Banks 6.05 08/22/96 4,000,000
-----------
TOTAL FEDERAL AGENCY SECURITIES 25,030,618
-----------
FEDERAL AGENCY SECURITIES--VARIABLE--23.3% (b)
Reset
Date
----
3,000 Federal Home Loan Mortgage
Corp. (final maturity 06/15/96) 6.10 11/01/95 3,003,828
3,500 Federal Farm Credit Bank
(final maturity 02/24/97) 6.01 11/01/95 3,498,670
3,500 Federal Farm Credit Bank
(final maturity 07/24/00) 6.04 11/01/95 3,500,000
4,000 Federal Home Loan Banks
(final maturity 01/14/97) 6.20 11/01/95 4,000,000
6,000 Student Loan Marketing Assoc.
(final maturity 08/16/96) 6.11 11/01/95 6,000,000
2,000 Student Loan Marketing Assoc.
(final maturity 07/19/96) 5.60 11/07/95 2,000,000
1,000 Student Loan Marketing Assoc.
(final maturity 11/24/97) 5.62 11/07/95 1,000,000
3,500 Student Loan Marketing Assoc.
(final maturity 11/10/98) 5.64 11/07/95 3,494,401
2,000 Student Loan Marketing Assoc.
(final maturity 02/22/99) 5.65 11/07/95 2,000,000
3,000 Student Loan Marketing Assoc.
(final maturity 01/11/96) 5.65 11/07/95 3,000,000
5,000 Student Loan Marketing Assoc.
(final maturity 02/08/99) 5.66 11/07/95 5,000,000
3,000 Student Loan Marketing Assoc.
(final maturity 03/07/01) 5.71 11/07/95 3,000,000
1,000 Student Loan Marketing Assoc.
(final maturity 10/14/97) 5.72 11/07/95 997,813
3,500 Student Loan Marketing Assoc.
(final maturity 10/30/97) 5.47 11/07/95 3,503,862
3,000 Federal National Mortgage
Assoc. (final maturity
12/14/98) 5.72 12/14/95 2,994,857
-----------
TOTAL FEDERAL AGENCY SECURITIES--VARIABLE 46,993,431
-----------
Maturity
Date
--------
COMMERCIAL PAPER--57.6%
1,595 Campbell Soup Co. A-1+ 5.90 11/01/95 1,595,000
$7,000 GTE North, Inc. A-1+ 5.71% 11/02/95 $ 6,998,890
2,450 Coca Cola Co. A-1+ 5.70 11/03/95 2,449,224
2,000 ESC Securitization,
Inc. A-1+ 5.77 11/03/95 1,999,359
1,325 United Parcel
Service of America,
Inc. A-1+ 5.72 11/03/95 1,324,579
3,800 Albertson's, Inc. A-1 5.72 11/06/95 3,796,981
273 GTE North, Inc. A-1+ 5.74 11/06/95 272,782
517 Receivables Capital
Corp. A-1 5.78 11/06/95 516,585
2,562 Vermont American
Corp. A-1+ 5.72 11/07/95 2,559,558
2,500 Corp. Asset
Securitization
Australia Ltd.,
Inc. A-1+ 5.77 11/08/95 2,497,195
2,235 E.I. DuPont de
Nemours A-1+ 5.70 11/09/95 2,232,169
3,000 GTE North, Inc. A-1+ 5.79 11/10/95 2,995,657
6,500 First Deposit
Funding Trust A-1+ 5.73 11/13/95 6,487,585
3,710 Albertson's, Inc. A-1 5.70 11/14/95 3,702,364
1,500 Minnesota Mining &
Manufacturing Co. A-1+ 5.70 11/14/95 1,496,912
1,795 Receivables Capital
Corp. A-1 5.75 11/15/95 1,790,986
2,000 Corp. Asset
Securitization-Casal A-1+ 5.77 11/16/95 1,995,192
8,000 H.J. Heinz Co. A-1 5.73 11/17/95 7,979,627
4,725 TDK USA Corp. A-1+ 5.72 11/17/95 4,712,988
6,000 Wal-Mart Stores,
Inc. A-1+ 5.70 11/17/95 5,984,800
5,590 TDK USA Corp. A-1+ 5.73 11/20/95 5,573,095
4,224 Receivable Funding
Corp. A-1+ 5.75 11/22/95 4,209,832
2,450 Corp. Asset
Securitization-Casal A-1+ 5.75 11/27/95 2,439,826
5,000 Ameritech Capital
Funding Corp. A-1+ 5.66 11/28/95 4,978,775
4,840 Vermont American
Corp. A-1+ 5.72 11/30/95 4,817,698
2,755 Philip Morris Cos. A-1 5.70 12/01/95 2,741,914
775 E.I. DuPont de
Nemours A-1+ 5.70 12/05/95 770,653
1,000 Receivables Capital
Corp. A-1 5.73 12/05/95 994,588
1,285 Receivables Capital
Corp. A-1 5.75 12/05/95 1,278,022
4,800 Preferred
Receivables
Funding A-1 5.71 12/06/95 4,773,353
<PAGE>
COMMERCIAL PAPER--continued
$2,335 Albertson's, Inc. A-1 5.72% 12/07/95 $ 2,321,644
6,500 Coca Cola Co. A-1+ 5.68 12/11/95 6,458,978
5,000 Minnesota Mining &
Manufacturing Co. A-1+ 5.67 12/13/95 4,966,925
7,000 E.I. DuPont de
Nemours A-1+ 5.53 07/23/96 6,715,051
-----------
TOTAL COMMERCIAL PAPER 116,428,787
-----------
VARIABLE RATE NOTES--5.1% (b)
3,800 General Electric
Capital Corp. A-1+ 5.91 07/26/96 3,803,406
6,500 General Electric
Capital Corp. A-1+ 5.94 08/22/96 6,502,948
-----------
TOTAL VARIABLE RATE NOTES 10,306,354
-----------
CERTIFICATES OF DEPOSIT--2.0%
4,000 Societe Generale
NY A-1+ 5.95% 07/15/96 $ 4,000,000
-----------
TOTAL CERTIFICATES OF DEPOSIT 4,000,000
-----------
TOTAL INVESTMENTS--100.4%
(Identified cost $202,759,190) 202,759,190(a)
Cash & receivables, less liabilities--(0.4)% (719,268)
-----------
NET ASSETS--100.0% $ 202,039,922
===========
(a) Federal Income Tax Information: At October 31, 1995, the aggregate cost
of securities was the same for book and tax purposes.
(b) Variable rate demand note. The interest rates shown reflect the rate
currently in effect.
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1995
Assets
Investment securities at value
(Identified cost $202,759,190) $202,759,190
Receivables
Fund shares sold 21,362
Interest 825,586
-----------
Total assets 203,606,138
-----------
Liabilities
Payables
Custodian 1,278,742
Dividend distributions 170,435
Fund shares repurchased 12,969
Investment advisory fee 73,395
Distribution fee 5,367
Financial agent fee 5,336
Trustees' fee 4,609
Accrued expenses 15,363
-----------
Total liabilities 1,566,216
-----------
Net Assets $202,039,922
===========
Net Assets Consist of:
Capital paid in on shares of beneficial interest $202,039,922
-----------
Net Assets $202,039,922
===========
Class A
Shares of beneficial interest outstanding, $1 par
value, unlimited authorization (Net Assets
$193,534,041) 193,534,041
Net asset value and offering price per share $1.00
Class B
Shares of beneficial interest outstanding, $1 par
value, unlimited authorization (Net Assets
$8,505,881) 8,505,881
Net asset value and offering price per share $1.00
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1995
Investment Income
Interest $12,429,738
----------
Total Investment Income 12,429,738
----------
Expenses
Investment advisory fee 825,836
Distribution fee--Class B 50,531
Financial agent fee 61,936
Transfer agent 463,556
Registration 31,129
Custodian 27,957
Professional 16,369
Trustees 16,250
Printing 15,180
Miscellaneous 9,779
----------
Total Expenses 1,518,523
----------
Net Investment Income $10,911,215
==========
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
October 31, October 31,
1995 1994
------------- --------------
From Operations
Net investment income $ 10,911,215 $ 5,927,905
----------- ------------
From Distributions to Shareholders
Net investment income--Class A (10,599,772) (5,919,450)
Net investment income--Class B (311,443) (8,455)
----------- ------------
Decrease in net assets from distributions
to shareholders (10,911,215) (5,927,905)
----------- ------------
From Share Transactions
Class A
Proceeds from sales of shares
(591,523,801 and 561,856,897 shares,
respectively) 591,523,801 561,856,897
Net asset value of shares issued from
reinvestment of distributions (9,841,714
and 5,735,541 shares, respectively) 9,841,714 5,735,541
Cost of shares repurchased (604,397,117
and 541,360,374 shares, respectively) (604,397,117) (541,360,374)
----------- ------------
Total (3,031,602) 26,232,064
----------- ------------
Class B
Proceeds from sales of shares (16,688,133
and 2,401,155 shares, respectively) 16,688,133 2,401,155
Net asset value of shares issued from
reinvestment of distributions (248,387
and 6,669 shares, respectively) 248,387 6,669
Cost of shares repurchased (10,516,662
and 321,801 shares, respectively) (10,516,662) (321,801)
----------- ------------
Total 6,419,858 2,086,023
----------- ------------
Increase in net assets from share
transactions 3,388,256 28,318,087
----------- ------------
Net increase in net assets 3,388,256 28,318,087
Net Assets
Beginning of period 198,651,666 170,333,579
----------- ------------
End of period $ 202,039,922 $ 198,651,666
=========== ============
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
Class A
-----------------------------------------------------
Year Ended October 31,
1995 1994 1993 1992 1991
------- ------- ------- ------- ---------
Net asset value,
beginning of
period $1.00 $1.00 $1.00 $1.00 $1.00
Income from
investment
operations
Net investment
income 0.053 0.032 0.025((1)) 0.035((1)) 0.060
------ ------ ------ ------ -------
Total from
investment
operations 0.053 0.032 0.025 0.035 0.060
------ ------ ------ ------ -------
Less
distributions
Dividends from
net investment
income (0.053) (0.032) (0.025) (0.035) (0.060)
------ ------ ------ ------ -------
Change in net
asset value -- -- -- -- --
------ ------ ------ ------ -------
Net asset
value, end
of period $1.00 $1.00 $1.00 $1.00 $1.00
====== ====== ====== ====== =======
Total return 5.32% 3.20% 2.50% 3.50% 6.00%
Ratios/
supplemental
data:
Net assets, end
of period
(thousands) $193,534 $196,566 $170,334 $180,786 $168,573
Ratio to
average net
assets of:
Operating
expenses 0.71% 0.85% 0.85% 0.85% 0.82%
Net investment
income 5.31% 3.19% 2.53% 3.50% 6.01%
Class B
-------------------------------
Year From
Ended Inception
October 31, 7/15/94 to
1995 10/31/94
------------- --------------
Net asset value,
beginning of
period $ 1.00 $ 1.00
Income from
investment
operations
Net investment
income 0.046 0.007
----------- -------------
Total from
investment
operations 0.046 0.007
----------- -------------
Less distributions
Dividends from net
investment income (0.046) (0.007)
----------- -------------
Change in net asset
value -- --
----------- -------------
Net asset value, end
of period $ 1.00 $ 1.00
=========== =============
Total return 4.63% 0.70%((3))
Ratios/supplemental
data:
Net assets, end of
period (thousands) $8,506 $2,086
Ratio to average net
assets of:
Operating expenses 1.44% 1.60%((2))
Net investment
income 4.62% 3.46%((2))
((1)) Includes reimbursement of operating expenses by investment adviser of
$0.0001 and $0.001, respectively.
((2)) Annualized
((3)) Not annualized
<PAGE>
PHOENIX SERIES FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1995
NOTE 1. SIGNIFICANT ACCOUNTING POLICIES
Phoenix Series Fund (the "Trust") is organized as a Massachusetts business
trust and is registered under the Investment Company Act of 1940, as amended,
as a diversified, open-end management investment company. Each Series offers
both Class A and Class B shares. Class A shares are sold with a front-end
sales charge of up to 4.75%. Class B shares are sold with a contingent
deferred sales charge which declines from 5% to zero depending on the period
of time the shares are held. Both classes of shares have identical voting,
dividend, liquidation and other rights and the same terms and conditions,
except that each class bears different distribution expenses and has
exclusive voting rights with respect to its distribution plan. Income and
expenses of each Series are borne pro rata by the holders of both classes of
shares, except that each class bears distribution expenses unique to that
class. The following is a summary of significant accounting policies
consistently followed by the Trust in the preparation of its financial
statements. These policies are in conformity with generally accepted
accounting principles.
A. Security valuation:
In determining the value of the investments of the Balanced Series, the
Convertible Series, the Growth Series, the U.S. Stock Series, the High Yield
Series, and the U.S. Government Securities Series, the securities for which
market quotations are readily available are valued at market value, which is
currently determined using the last reported sale price, or if no sales are
reported, the last reported bid price. Debt securities (other than short-term
obligations, which are valued on the basis of amortized cost, which
approximates market, as defined below) are valued on the basis of broker
quotations or valuations provided by a pricing service when such prices are
believed to reflect the fair value of such securities. Short-term
investments having a remaining maturity of less than sixty days are valued at
amortized cost which approximates market. Prices provided by the pricing
service may be determined without exclusive reliance on quoted prices and
take into account appropriate factors such as institution-size trading in
similar groups of securities, yield, quality, coupon rate, maturity, type of
issue, trading characteristics and other market data. Use of the pricing
service has been approved by the Trustees. All other securities and assets
are valued at their fair value as determined in good faith by or under the
direction of the Trustees.
The Money Market Series uses the amortized cost method of security valuation
which, in the opinion of the Trustees, represents the fair value of the
particular security. The Trustees monitor the deviations between the classes'
net asset value per share as determined by using available market quotations
and its amortized cost per share. If the deviation exceeds 1/2 of 1%, the
Board of Trustees will consider what action, if any, should be initiated to
provide a fair valuation. This valuation procedure allows each class of the
Series to maintain a constant net asset value of $1 per share. The assets of
the Series will not be invested in any security with a maturity of greater
than 397 days, and the average weighted maturity of its portfolio will not
exceed 90 days.
B. Security transactions and related income:
Security transactions are recorded on the trade date. Dividend income is
recorded on the ex-dividend date or, in the case of certain foreign
securities, as soon as the Series is notified. Interest income is recorded on
the accrual basis. The Trust does not amortize premiums except for the Money
Market Series, but does amortize discounts using the effective interest
method. Realized gains and losses are determined on the identified cost
basis.
C. Income taxes:
Each of the Series is treated as a separate taxable entity. It is the policy
of each Series in the Trust to comply with the requirements of the Internal
Revenue Code (the Code), applicable to regulated investment companies, and to
distribute substantially all of its taxable income to its shareholders. In
addition, each Series intends to distribute an amount sufficient to avoid
imposition of any excise tax under Section 4982 of the Code. Therefore, no
provision for federal income taxes or excise taxes has been made.
D. Distributions to shareholders:
Distributions are recorded by each Series on the ex-dividend date. Income
and capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences include the treatment of non-taxable dividends, expiring
capital loss carryforwards, foreign currency gain/loss, partnerships, and
losses deferred due to wash sales and excise tax regulations. Permanent book
and tax basis differences relating to shareholder distributions will result
in reclassifications to paid in capital.
E. Foreign currency translation:
Foreign securities, other assets and liabilities are valued using the foreign
currency exchange rate effective at the end of the reporting period. Cost of
investments is translated at the currency exchange rate effective at the date
of settlement. The gain or loss resulting from a change in currency exchange
rates between the trade and settlement dates of a portfolio transaction is
treated as a gain or loss on foreign currency. Likewise, the gain or loss
<PAGE>
resulting from a change in currency exchange rates, between the date income
is accrued and paid, is treated as a gain or loss on foreign currency. The
Trust does not separate that portion of the results of operations arising
from changes in exchange rates and that portion arising from changes in the
market prices of securities.
F. Forward currency contracts:
Each of the Series, except U.S. Government Securities Fund Series and Money
Market Fund Series, may enter into forward currency contracts in conjunction
with the planned purchase or sale of foreign denominated securities in order
to hedge the U.S. dollar cost or proceeds. The maximum potential loss from
such contracts is the aggregate face value in U.S. dollars at the time the
contract is opened, however, management believes the likelihood of such loss
to be remote.
A forward currency contract involves an obligation to purchase or sell a
specific currency at a future date, which may be any number of days from the
date of the contract agreed upon by the parties, at a price set at the time
of the contract. These contracts are traded directly between currency traders
and their customers. The contract is marked-to-market daily and the change in
market value is recorded by each Series as an unrealized gain (or loss). When
the contract is closed, the fund records a realized gain (or loss) equal to
the change in the value of the contract when it was opened and the value at
the time it was closed.
G. Futures contracts:
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into a futures
contract the Series is required to pledge to the broker an amount of cash
and/or securities equal to the "initial margin" requirements of the futures
exchange on which the contract is traded. Pursuant to the contract, the
Series agrees to receive from or pay to the broker an amount of cash equal to
the daily fluctuation in value of the contract. Such receipts or payments are
known as variation margin and are recorded by the Series as unrealized gains
or losses. When the contract is closed, the Series records a realized gain or
loss equal to the difference between the value of the contract at the time it
was opened and the value at the time it was closed.
H. Security lending:
The Trust loans securities to qualified brokers through an agreement with
State Street Bank & Trust (the Custodian). Under the terms of the agreement,
the Trust receives collateral with a market value not less than 100% of the
market value of loaned securities. Collateral is adjusted daily in connection
with changes in the market value of securities on loan. Collateral consists
of cash, securities issued or guaranteed by the U.S. Government or its
agencies and the sovereign debt of foreign countries. Interest earned on the
collateral and premiums paid by the borrower are recorded as interest income
by the Trust net of fees charged by the Custodian for its services in
connection with this securities lending program. Lending portfolio securities
involves a risk of delay in the recovery of the loaned securities or in the
foreclosure on collateral. At October 31, 1995, the Trust had the following
amounts of security loans:
Value of
Securities Value of
on Loan Collateral
----------- -------------
Balanced Fund Series $218,238,517 $219,237,541
Convertible Fund Series 1,610,325 1,632,500
Growth Fund Series 16,486,262 16,210,791
U.S. Stock Fund Series 19,701,967 19,157,212
High Yield Fund Series 10,353,419 10,333,587
U.S. Government Securities
Fund Series 5,086,221 5,181,250
I. Expenses:
Expenses incurred by the Trust with respect to any two or more Series are
allocated in proportion to the net assets of each Series, except where
allocation of direct expense to each Series or an alternative allocation
method can be more fairly made.
NOTE 2. INVESTMENT ADVISORY FEE AND RELATED PARTY TRANSACTIONS
As compensation for its services to the Trust, the Adviser, Phoenix
Investment Counsel, Inc., an indirect wholly-owned subsidiary of Phoenix Home
Life Mutual Insurance Company ("PHL"), is entitled to a fee based upon the
following annual rates as a percentage of the average daily net assets of
each separate Series:
1st
$1 $1-2 $2+
Series Billion Billion Billion
- ------------------------- --------- ------ --------
Growth Fund Series 0.70% 0.65% 0.60%
U.S. Stock Fund Series 0.70% 0.65% 0.60%
Convertible Fund Series 0.65% 0.60% 0.55%
High Yield Fund Series 0.65% 0.60% 0.55%
Balanced Fund Series 0.55% 0.50% 0.45%
U.S. Government
Securities Fund Series 0.45% 0.40% 0.35%
Money Market Fund Series 0.40% 0.35% 0.30%
The Adviser has agreed to assume expenses and reduce the advisory fee for the
benefit of the Money Market Fund Series to the extent that total expenses
(excluding interest, taxes, brokerage fees and commissions and extraordinary
expenses) exceed 0.85% for Class A shares and 1.60% for Class B shares of the
average of the aggregate daily net asset value.
<PAGE>
The Adviser's parent company, Phoenix Equity Planning Corporation (PEPCO), an
indirect wholly-owned subsidiary of PHL, which serves as the national
distributor of the Trust's shares, has advised the Fund that it received
selling commissions of $720,088 for Class A shares and deferred sales charges
of $136,785 for Class B shares, for the year ended October 31, 1995. In
addition, each Series except the Money Market Series pays PEPCO a
distribution fee of an annual rate of 0.25% for Class A shares and 1.00% for
Class B shares applied to the average daily net assets of each Series; the
distribution fee for the Money Market Series is 0% and .75% for Class A and
Class B, respectively. The distributor has advised the Series that of the
total amount expensed for the year ended October 31, 1995, $3,326,552 was
earned by the Distributor and $11,310,283 was earned by unaffiliated
participants.
As Financial Agent to the Trust and to each Series, PEPCO receives a fee at
an annual rate of 0.03% of the average daily net assets for bookkeeping,
administrative and pricing services. PEPCO serves as the Funds' Transfer
Agent with State Street Bank and Trust Company as sub-transfer agent. For
the year ended October 31, 1995, transfer agent fees were $11,917,881 of
which PEPCO retained $4,178,370 which is net of fees paid to State Street.
At October 31, 1995, Phoenix Home Life Mutual Insurance Company and
affiliates held Phoenix Series Fund shares which aggregated the following:
Aggregate
Net Asset
Shares Value
-------- ----------
High Yield Series Class A 330 $ 2,693
U.S. Stock Fund Series Class B 8,419 137,898
Money Market Fund Series Class A 2,704,495 2,704,495
U.S. Government Securities Fund
Series Class A 268 2,659
NOTE 3. PURCHASE AND SALE OF SECURITIES
Purchases and sales of securities during the year ended October 31, 1995
(excluding U.S. Government securities and short-term securities) aggregated
the following:
Purchases Sales
----------- -------------
Balanced Fund Series $2,730,712,034 $2,739,831,092
Convertible Fund Series 156,665,865 181,024,659
Growth Fund Series 2,097,975,594 2,164,560,476
U.S. Stock Fund Series 471,343,892 431,229,648
High Yield Fund Series 602,357,124 631,388,118
Purchases and sales of U.S. Government securities during the year ended
October 31, 1995, aggregated the following:
Purchases Sales
----------- -------------
Balanced Fund Series $1,242,497,355 $1,328,666,242
Convertible Fund Series -- --
Growth Fund Series -- 73,617,750
U.S. Stock Fund Series -- 14,753,906
High Yield Fund Series 131,165,707 120,924,076
U.S. Government
Securities Fund
Series 420,218,005 440,143,993
NOTE 4. RECLASS OF CAPITAL ACCOUNTS
In accordance with accounting pronouncements, the series of the Fund have
recorded several reclassifications in the capital accounts. These
reclassifications have no impact on the net asset value of the series and are
designed generally to present undistributed income and realized gains on a
tax basis which is considered to be more informative to the shareholder. As
of October 31, 1995, the Series recorded the following reclassifications to
increase (decrease) the accounts listed below:
Undistributed Accumulated
net net Capital paid
investment realized in on shares
income gains of beneficial
(loss) (losses) interest
------------ ----------- -------------
Balanced Fund
Series $(1,204,624) $ 1,064,612 $ 140,012
Convertible
Fund Series 37,745 (43,799) 6,054
Growth Fund
Series 4,595,827 (4,509,650) (86,177)
U.S. Stock Fund
Series 6,107 24 (6,131)
High Yield Fund
Series 45,346 315,737 (361,083)
U.S. Government
Securities
Fund Series (20,723) (4,574,431) 4,595,154
TAX INFORMATION NOTICE (Unaudited)
For the fiscal year ended October 31, 1995, the U.S. Stock Fund Series
distributed long-term capital gains dividends of $7,274,075.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP [Price Waterhouse logo]
To the Shareholders and Trustees of
Phoenix Series Fund
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments (except for bond ratings), and the
related statements of operations and of changes in net assets and the
financial highlights present fairly, in all material respects, the financial
position of the Balanced Fund Series, the Convertible Fund Series, the Growth
Fund Series, the U.S. Stock Fund Series, the High Yield Fund Series, the U.S.
Government Securities Fund Series and the Money Market Fund Series
(constituting the Phoenix Series Fund, hereafter referred to as the "Fund")
at October 31, 1995, the results of each of their operations for the year
then ended, the changes in each of their net assets for each of the two years
in the period then ended and the financial highlights for each of the periods
indicated, in conformity with generally accepted accounting principles. These
financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the fund's management; our
responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these financial statements in
accordance with generally accepted auditing standards which require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at October 31, 1995 by correspondence with the
custodian and brokers, and the application of alternative auditing procedures
where confirmations from brokers were not received, provide a reasonable
basis for the opinion expressed above.
/s/ Price Waterhouse LLP
Boston, Massachusetts
December 18, 1995
<PAGE>
WHAT IS THE PHOENIX SERIES FUND?
Phoenix Series Fund is your investment for a lifetime! Consisting of seven
individual portfolios, each with a separate investment objective, the Series
Fund is a mutual fund designed to provide you with convenience and
flexibility in making your investment decisions. As your personal financial
needs change, you can easily redirect your investment to a more suitable
portfolio within the Series Fund.
WHO MANAGES MY FUND?
Phoenix Investment Counsel, Inc., a Phoenix Home Life Mutual Insurance
Company, provides skilled and professional management services, including
investment selection and portfolio supervision.
WHY ARE THERE SEVEN FUNDS?
We have designed seven separate funds, each with different investment
objectives, in order to meet a variety of investment goals.
Phoenix Balanced Fund Series seeks as its investment objectives reasonable
income, long-term capital growth and conservation of capital.
Phoenix Convertible Fund Series seeks as its investment objectives income and
the potential for capital appreciation; these objectives are to be considered
relatively equal.
Phoenix Growth Fund Series seeks as its investment objective long-term
appreciation of capital. Since income is not an objective, any income
generated by the investment of this Series' assets will be incidental to its
objective.
Phoenix High Yield Fund Series seeks as its investment objective high current
income. Capital growth is a secondary objective which will also be considered
when consistent with the primary objective of high current income.
Phoenix Money Market Fund Series seeks as its investment objective as high a
level of current income as is consistent with the preservation of capital and
the maintenance of liquidity.
Phoenix U.S. Stock Fund Series seeks as its investment objective appreciation
of capital through the use of aggressive investment techniques.
Phoenix U.S. Government Securities Fund Series seeks as its investment
objective a high level of current income consistent with safety of principal.
WHAT IF MY FINANCIAL NEEDS CHANGE?
Just call us. At your request, the value of shares in any account can be
exchanged toward the purchase of shares of any other fund within the Series
Fund by using the Exchange Privilege.
HOW DOES THE EXCHANGE PRIVILEGE WORK?
Our Exchange Privilege offers the flexibility needed to assure the most
suitable portfolio throughout your lifetime. At any time you may redirect
some or all of your present holdings into another fund in the Series Fund
which better serves your needs. Just call us with the details. We'll process
the exchange free of charge. The toll-free number to call with your exchange
request is 800-367-5877. The exchange privilege may be modified or
terminated, as noted in the prospectus.
HOW DO I MAKE ADDITIONAL INVESTMENTS?
Send your check directly to State Street Bank and Trust Company, P.O. Box
8301, Boston, MA 02266-8301. Please include either the bottom section of your
confirmation statement or a simple letter of instruction.
CAN I MAKE AUTOMATIC MONTHLY INVESTMENTS?
You may authorize automatic monthly investments for as little as $25 to be
made directly from your personal checking account. An application is
available from the Series Fund.
CAN I ESTABLISH AN INDIVIDUAL RETIREMENT ACCOUNT (IRA) WITH PHOENIX SERIES
FUND?
Yes! The Phoenix Series Fund is an appropriate investment vehicle for
qualified retirement plans including IRAs, Keoghs, Pension and Profit Sharing
Plans.
HOW DO I ESTABLISH AN IRA?
Just call us. We'll send you our EASY IRA KIT which includes an IRA
application and other required documents.
HOW MUCH CAN I INVEST INTO AN IRA?
Individuals may invest up to $2,000 or 100% of earned income, whichever is
less. If you have an unemployed spouse, the maximum contribution could
increase to $2,250. Please refer to the Phoenix EASY IRA KIT for
clarification.
WHAT ARE THE TAX ADVANTAGES OF ESTABLISHING AN IRA?
Individuals who meet the deductibility requirements may deduct their yearly
IRA contributions from their taxable income, and thus, pay less tax.
Additionally, the account's earnings still accumulate tax-free until you
withdraw your money at retirement.
WHO CAN ANSWER MY QUESTIONS?
Most questions can be answered by our Customer Service Department. We are
equipped with computer terminals which allow quick and easy access to
information on your account. In most cases, your questions can be answered by
calling us toll-free at 800-243-1574.
<PAGE>
PHOENIX SERIES FUND
101 Munson Street
Greenfield, Massachusetts 01301
Trustees
C. Duane Blinn
Robert Chesek
E. Virgil Conway
Harry Dalzell-Payne
Leroy Keith, Jr.
Philip R. McLoughlin
James M. Oates
Philip R. Reynolds
Herbert Roth, Jr.
Richard E. Segerson
Lowell P. Weicker, Jr.
Officers
Philip R. McLoughlin, President
Martin J. Gavin, Executive Vice President
Michael E. Haylon, Executive Vice President
Michael K. Arends, Vice President
Curtiss O. Barrows, Vice President
Mary E. Canning, Vice President
James M. Dolan, Vice President
John M. Hamlin, Vice President
Christopher J. Kelleher, Vice President
William R. Moyer, Vice President
Amy L. Robinson, Vice President
Leonard J. Saltiel, Vice President
Dorothy J. Skaret, Vice President
James D. Wehr, Vice President
Nancy G. Curtiss, Treasurer
G. Jeffrey Bohne, Secretary
Investment Adviser
Phoenix Investment Counsel, Inc.
56 Prospect Street
Hartford, Connecticut 06115-0480
Principal Underwriter
Phoenix Equity Planning Corporation
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, Connecticut 06083-2200
Transfer Agent
Phoenix Equity Planning Corporation
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, CT 06083-2200
Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, Massachusetts 02101
Legal Counsel
Jorden, Burt, Berenson & Johnson LLP
Suite 400 East
1025 Thomas Jefferson Street, N.W.
Washington, D.C. 20007-0805
Independent Accountants
Price Waterhouse LLP
160 Federal Street
Boston, Massachusetts 02110
This report is not authorized for distribution to prospective investors in
the Phoenix Series Fund unless preceded or accompanied by an effective
Prospectus which includes information concerning the sales charge, Fund's
record and other pertinent information.
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
[BACK COVER]
Phoenix Series Fund
P.O. Box 2200
Enfield, CT 06083-2200
[double-diamond logo] Phoenix Duff & Phelps
PDP 394 (12/95)
Bulk Rate Mail
U.S. Postage
PAID
Springfield, MA
Permit No. 444
[FRONT COVER]
Phoenix Funds
Phoenix Series Fund
Annual Report
October 31, 1995
Balanced Fund Series
Convertible Fund Series
Growth Fund Series
U.S. Stock Fund Series
High Yield Fund Series
U.S. Government Securities Fund Series
Money Market Fund Series
[Graphic image: antique dollar bills]
[double-diamond logo] Phoenix Duff & Phelps
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
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<NAME> Class B
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NAME> Class A
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
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<SERIES>
<NAME> Class B
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<S> <C>
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
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<NAME> Class A
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
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<NAME> Class B
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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<NAME> Class A
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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