<PAGE>
- --------------------------------------------------
ANNUAL REPORT
- --------------------------------------------------
P H O E N I X
THE PHOENIX EDGE SERIES FUND
DECEMBER 31, 1999
[PHOENIX LOGO]
WEALTH MANAGEMENT-SM-
- -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Phoenix-Aberdeen International Series....................... 2
Phoenix-Engemann Capital Growth Series...................... 10
Phoenix-Engemann Nifty Fifty Series......................... 15
Phoenix-Goodwin Money Market Series......................... 20
Phoenix-Goodwin Multi-Sector Fixed Income Series............ 25
Phoenix-Hollister Value Equity Series....................... 31
Phoenix-Oakhurst Balanced Series............................ 36
Phoenix-Oakhurst Growth and Income Series................... 44
Phoenix-Oakhurst Strategic Allocation Series................ 52
Phoenix-Seneca Mid-Cap Growth Series........................ 60
Phoenix-Seneca Strategic Theme Series....................... 65
Phoenix-Aberdeen New Asia Series............................ 69
Phoenix-Duff & Phelps Real Estate Securities Series......... 77
Phoenix Research Enhanced Index Series...................... 83
Phoenix-Bankers Trust Dow 30 Series......................... 92
Phoenix-Federated U.S. Government Bond Series............... 96
Phoenix-Janus Equity Income Series.......................... 100
Phoenix-Janus Flexible Income Series........................ 105
Phoenix-Janus Growth Series................................. 109
Phoenix-Morgan Stanley Focus Equity Series.................. 113
Phoenix-Schafer Mid-Cap Value Series........................ 117
Notes to Financial Statements............................... 121
</TABLE>
<TABLE>
<S> <C> <C>
Not FDIC Insured No Bank Guarantee May Lose Value
</TABLE>
<PAGE>
PHOENIX-ABERDEEN INTERNATIONAL SERIES
INVESTOR PROFILE
The Fund is appropriate for investors seeking long-term capital appreciation
by investing primarily in an internationally diversified portfolio of equity
securities. The Fund essentially focuses on quality companies with strong
management, solid growth prospects and attractive relative valuations. Investors
should note that foreign investments pose added risks, such as currency
fluctuation, less public disclosure, as well as economic and political risks.
INVESTMENT ADVISOR'S REPORT
For the year ended December 31, 1999 the Fund returned 29.49% compared with
a return of 27.30% for the Fund's benchmark index, the MSCI EAFE Index(1). All
performance figures assume reinvestment of distributions and are net of sales
charges.
All stock markets have traveled a considerable distance since the dark days
of October 1998 and indeed most are substantially higher than at the previous
peaks a year ago. In Western equity markets, much of Europe has made significant
headway but for U.S. investors these returns have been diminished by the
weakness of the euro against a strong dollar.
For the greater part of this year, Far Eastern markets have been busy
garnering new/reconstructed converts, with foreign money the sole source of
support for Japan and an important one for Asia Pacific. The restructuring story
continues to drive Japan forward, and unlike Europe, the strength of the yen has
boosted returns for U.S. investors. Emerging markets have seen their customary
volatility bottom, in general, and have benefited from the strengthening global
recovery, with industrial production now accelerating virtually everywhere. Y2K
risks and rising U.S. interest rates have put upward pressure on risk premiums,
while political developments in Brazil have not helped but further progress is
still expected.
The past few months have witnessed some truly spectacular stock market
performances. Many commentators had expected some fireworks in the run up to the
end of the year, but not all one way. In all major markets, the technology/
telecommunications sectors led the surge, indicating once again the trend
towards globalization. Momentum buying, merger and acquisition activity and
probably a genuine desire by many investors to be fully invested in the fastest
growing sectors of the economy all combined to produce such a move on massive
volumes. The scale of some of the advances in the UK and Europe as well as the
U.S., however, defies "traditional" rational judgement. The footprint of U.S.
investors keen to build up UK and European technology weightings is as obvious
as it was when cyclicals surged so massively earlier in the year. For many
companies, absolutely nothing has changed, forecasts are the same, and their
prospects are the same, yet share prices of some very large companies have
rocketed.
OUTLOOK
In Europe growth continues to accelerate, with France in the vanguard and
Germany now in a "clear upswing," according to the Bundesbank. With monetary
policy still accommodative, overall euro-zone growth could approach 3% next
year. Recent data releases in the UK, such as retail sales and the labor
reports, suggest annualized GDP growth of around 4.0% can be sustained in the
coming quarters. Japan's latest stimulus package, together with some pick up in
consumer spending, should ensure positive growth figures for next year, even
though capital investment remains a drag for now. Elsewhere in the Far East,
booming export growth, accelerating capital investment, and private consumption
are ensuring extremely high comparative growth numbers.
Overall, for the first time in a decade, global economic performance is
converging, with current buoyant activity around the world being forecast to be
maintained for several years by most economic commentators. While Western
central banks have embarked on a first phase of monetary tightening, this has
only partly or fully reversed earlier easing. Thus, for the time being, monetary
conditions in general remain supportive of growth.
Despite growing commodity-related pressures, core inflation remains
remarkably subdued worldwide. UK inflation appears as remarkably well behaved as
that in the U.S. The UK's monetary policy committee is, however, likely to
remain pre-emptive and short circuit any sustained pick up in inflation. The 50
basis point rate rise in November was intended to head off any inflationary
acceleration, and forecasts in general for next year remain below the euro-zone
upper limit of 2%.
Even though inflation figures may remain subdued, the November interest rate
increases in the UK and euro-zone are likely to be the opening salvo in a move
towards tighter monetary conditions next year. The financial backdrop remains
supportive of growth and short and long rates are still low by historic
standards, while global equity markets are on the rise.
In general, most equity markets are still below our estimates of "fair
value" and therefore, while having rallied hard in recent times, have not
discounted the progress that we expect for next year. The U.S. remains the key
risk. Bond yields look to
(1) The Morgan Stanley Capital International (MSCI) EAFE Index is an unmanaged,
commonly used measure of foreign stock total return performance. The Index
is not available for direct investment.
2
<PAGE>
PHOENIX-ABERDEEN INTERNATIONAL SERIES
be heading higher in the near term, but recent developments in the UK gilt
market are highly instructive for others when shortages develop. Overall we are
reasonably positive about next year for the international markets but would
rather increase weightings in equities on any potential setback.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
INTERNATIONAL SERIES MSCI EAFE INDEX *
<S> <C> <C>
05/1/1990 $10,000.00 $10,000.00
12/31/1990 $9,190.13 $9,639.77
12/31/1991 $10,997.48 $10,844.29
12/31/1992 $9,588.85 $9,559.06
12/31/1993 $13,274.36 $12,708.10
12/31/1994 $13,277.90 $13,732.16
12/31/1995 $14,551.73 $15,318.21
12/31/1996 $17,264.96 $16,292.86
12/31/1997 $19,344.23 $16,627.90
12/31/1998 $24,745.88 $20,008.67
12/31/1999 $32,044.50 $25,470.74
</TABLE>
<TABLE>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
FROM
INCEPTION
5/1/90 TO
1 YEAR 5 YEARS 12/31/99
<S> <C> <C> <C>
- -------------------------------------------------------------------------------------------
International Series 29.49% 19.27% 12.79%
- -------------------------------------------------------------------------------------------
MSCI EAFE Index* 27.30% 13.15% 10.14%
- -------------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 5/1/90
(inception of the Fund). Returns shown include the reinvestment of all
distributions at net asset value, and the change in share price for the stated
period. Returns indicate past performance, which is not predictive of future
performance. Investment return and net asset value will fluctuate so that your
shares, when redeemed, may be worth more or less than the original cost. Foreign
investing involves special risks such as currency fluctuation and less public
disclosure, as well as economic and political risks.
* The Morgan Stanley Capital International EAFE Index is an unmanaged, commonly
used measure of foreign stock fund performance which includes net dividends
reinvested. Total return figures are net of foreign withholding taxes. The
EAFE index is an aggregate of 19 individual country indexes in Europe,
Australia, New Zealand and the Far East.
3
<PAGE>
PHOENIX-ABERDEEN INTERNATIONAL SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
FOREIGN COMMON STOCKS--96.9%
ARGENTINA--0.1%
Perez Companc SA Sponsored ADR (Oil & Gas
(Exploration & Production))............... 20,000 $ 204,824
------------
AUSTRALIA--1.5%
Australian Gas Light Co., Ltd. (Natural
Gas)...................................... 290,000 1,703,338
QBE Insurance Group Ltd. (Insurance
(Property-Casualty))...................... 570,000 2,658,879
------------
4,362,217
------------
BELGIUM--0.4%
Dexia (Banks (Major Regional)) (b).......... 7,400 1,223,769
------------
BRAZIL--0.8%
Tele Centro Sul Participacoes SA ADR
(Telecommunications (Long Distance))...... 6,800 617,100
Tele Norte Leste Participacoes SA ADR
(Telecommunications (Long Distance))...... 21,400 545,700
Tele Sudeste Celular Participacoes SA ADR
(Telecommunications
(Cellular/Wireless))...................... 18,800 729,675
Telesp Participacoes SA ADR
(Telecommunications (Long Distance))...... 22,300 544,956
------------
2,437,431
------------
CANADA--5.8%
Nortel Networks Corp. (Communications
Equipment)................................ 100,000 10,100,000
Seagram Co. Ltd. (The) (Entertainment)...... 70,000 3,145,625
Toronto-Dominion Bank (The) (Banks (Money
Center)).................................. 147,000 3,969,000
------------
17,214,625
------------
DENMARK--0.9%
Danisco A/S (Foods)......................... 24,734 963,115
Tele Danmark A/S (Telephone)................ 24,477 1,816,862
------------
2,779,977
------------
FINLAND--3.5%
Helsingin Puhelin Oyj (Telephone)........... 24,819 2,067,208
Nokia Oyj (Communications Equipment)........ 37,532 6,804,069
Stora Enso Oyj (Paper & Forest Products).... 39,678 691,737
UPM-Kymmene Oyj (Paper & Forest Products)... 24,379 982,133
------------
10,545,147
------------
FRANCE--10.0%
Air Liquide SA (Chemicals (Specialty))...... 6,094 1,020,065
Alcatel (Communications Equipment).......... 11,685 2,683,231
Alstom (Engineering & Construction)......... 19,232 641,131
Axa (Insurance (Multi-Line))................ 15,721 2,191,345
Canal Plus (Broadcasting (Television, Radio
& Cable))................................. 10,013 1,457,225
Carrefour SA (Retail (Food Chains))......... 10,424 1,922,283
Castorama Dubois (Retail (Building
Supplies))................................ 6,325 1,923,809
Christian Dior SA (Beverages (Alcoholic))... 6,576 1,629,264
Coflexip SA (Metal Fabricators)............. 14,776 1,073,712
Compagnie de Saint-Gobain (Manufacturing
(Diversified))............................ 2,955 555,644
Lafarge SA (Construction (Cement &
Aggregates)).............................. 19,504 2,270,785
Pechiney SA Class A (Containers & Packaging
(Paper)).................................. 19,133 1,367,193
Renault SA (Automobiles).................... 21,139 1,018,947
Sanofi-Synthelabo SA (Health Care
(Diversified)) (b)........................ 23,878 994,175
Schneider Electric SA (Electrical
Equipment)................................ 16,004 1,256,432
Societe Generale Class A (Banks (Major
Regional))................................ 5,550 1,291,218
Suez Lyonnaise des Eaux SA (Engineering &
Construction)............................. 4,279 685,657
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
FRANCE--CONTINUED
Total Fina SA Class B (Oil & Gas (Refining &
Marketing))............................... 23,997 $ 3,202,339
Valeo SA (Auto Parts & Equipment)........... 17,245 1,330,413
Vivendi (Manufacturing (Diversified))....... 16,689 1,506,868
------------
30,021,736
------------
GERMANY--7.3%
Allianz AG Vinkulierte Registered Shares
(Insurance (Multi-Line)).................. 5,477 1,839,641
BASF AG (Chemicals (Diversified))........... 36,219 1,860,378
Bayer AG (Chemicals (Diversified)).......... 23,621 1,118,126
Bewag AG (Electric Companies)............... 39,214 454,186
DaimlerChrysler AG (Automobiles)............ 23,753 1,846,844
Deutsche Bank AG (Banks (Major Regional))... 19,513 1,647,865
Deutsche Lufthansa AG (Airlines)............ 92,387 2,149,400
Deutsche Telekom AG (Telephone)............. 11,711 837,427
HypoVereinsbank AG (Banks (Major
Regional))................................ 27,900 1,905,147
Mannesmann AG (Telephone)................... 12,472 3,008,404
Metro AG (Retail (Specialty))............... 27,044 1,454,476
Muenchener Rueckversicherungs-Gesellschaft
AG (Insurance (Multi-Line))............... 8,250 2,092,205
RWE AG (Manufacturing (Diversified))........ 27,076 1,060,788
Volkswagen AG (Automobiles)................. 8,473 477,454
------------
21,752,341
------------
GREECE--0.2%
Hellenic Telecommunications Organization SA
(Telephone)............................... 26,500 629,741
------------
HONG KONG--2.1%
Cheung Kong (Holdings) Ltd. (Financial
(Diversified))............................ 45,000 571,654
Swire Pacific Ltd. Class B (Manufacturing
(Diversified))............................ 6,400,000 5,639,673
------------
6,211,327
------------
HUNGARY--0.3%
Magyar Tavkozlesi Rt Sponsored ADR
(Telecommunications (Long Distance))...... 21,900 788,400
------------
INDIA--1.0%
BSES Ltd. GDR (Electric Companies) (b)...... 83,000 1,079,000
Gas Authority of India Ltd. GDR (Oil & Gas
(Refining & Marketing)) (b)............... 40,000 378,000
Mahanagar Telephone Nigam Ltd. GDR
(Telecommunications (Long Distance))...... 140,000 1,589,000
------------
3,046,000
------------
INDONESIA--0.6%
PT Indosat (Telecommunications (Long
Distance))................................ 379,000 846,140
PT Indosat (Persero) Tbk ADR
(Telecommunications (Long Distance))...... 45,000 973,125
------------
1,819,265
------------
ISRAEL--0.2%
Bank Hapoalim Ltd. (Banks (Major
Regional))................................ 221,500 689,739
------------
ITALY--2.7%
Assicurazioni Generali (Insurance
(Life/Health))............................ 32,265 1,065,860
Banca Intesa SPA (Banks (Major Regional))... 591,895 1,204,178
Beni Stabili SPA (Financial (Diversified))
(b)....................................... 103,701 36,555
Eni SPA (Oil (Domestic Integrated))......... 201,540 1,108,277
San Paolo-IMI SPA (Banks (Major
Regional))................................ 93,422 1,269,275
Telecom Italia Mobile SPA (Telephone)....... 156,190 1,744,533
Telecom Italia SPA (Telephone).............. 118,499 1,670,849
------------
8,099,527
------------
</TABLE>
See Notes to Financial Statements
4
<PAGE>
PHOENIX-ABERDEEN INTERNATIONAL SERIES
<TABLE>
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
JAPAN--17.8%
Asahi Bank Ltd. (The) (Banks (Major
Regional))................................ 360,000 $ 2,219,830
Canon, Inc. (Office Equipment & Supplies)... 69,000 2,741,901
Circle K Japan Co., Ltd. (Retail (Food
Chains)).................................. 51,000 2,091,514
Dai Nippon Printing Co., Ltd. (Specialty
Printing)................................. 126,000 2,010,179
Fuji Photo Film Co. (Photography/Imaging)... 58,000 2,117,451
Fujitsu Ltd. (Computers (Hardware))......... 55,000 2,508,564
Hitachi Credit Corp. (Consumer Finance)..... 94,000 1,909,073
Ito-Yokado Co., Ltd. (Retail (Food
Chains)).................................. 21,000 2,281,492
Kao Corp. (Household Products
(Non-Durable))............................ 73,000 2,082,754
Mabuchi Motor Co., Ltd. (Electrical
Equipment)................................ 17,000 2,966,722
NTT Mobile Communications Network, Inc.
(Telecommunications
(Cellular/Wireless))...................... 800 3,077,224
Nikko Securities Co., Ltd. (The) (Investment
Banking/Brokerage)........................ 190,000 2,404,522
Nippon Telegraph & Telephone Corp.
(Telephone)............................... 1,300 2,226,681
Rinnai Corp. (Household Furnishings &
Appliances)............................... 82,500 1,534,208
Rohm Co., Ltd. (Electronics
(Semiconductors))......................... 10,000 4,110,796
Sankyo Co., Ltd. (Health Care (Drugs-Major
Pharmaceuticals))......................... 115,000 2,363,708
Sanwa Bank Ltd. (The) (Banks (Major
Regional))................................ 205,000 2,494,030
Secom Co., Ltd. (Services (Commercial &
Consumer))................................ 20,000 2,202,212
Sharp Corp. (Household Furnishings &
Appliances)............................... 138,000 3,532,054
Shin-Etsu Chemical Co., Ltd. (Chemicals
(Specialty)).............................. 53,000 2,282,470
Suzuki Motor Corp. (Automobiles)............ 140,000 2,043,065
Yamato Transport Co. Ltd. (Air Freight)..... 53,000 2,054,223
------------
53,254,673
------------
MALAYSIA--0.2%
Carlsberg Brewery Malaysia Berhad (Beverages
(Alcoholic)).............................. 150,000 461,836
Malaysian Oxygen Berhad (Chemicals
(Specialty)).............................. 104,000 257,260
------------
719,096
------------
MEXICO--1.0%
Cemex SA de C.V. Sponsored ADR (Construction
(Cement & Aggregates)) (b)................ 26,600 741,475
Coca-Cola Femsa SA Sponsored ADR (Beverages
(Non-Alcoholic)).......................... 44,000 772,750
Grupo Televisa SA Sponsored GDR
(Broadcasting (Television, Radio & Cable))
(b)....................................... 10,000 682,500
Telefonos de Mexico SA Sponsored ADR Class L
(Telecommunications (Long Distance))...... 7,600 855,000
------------
3,051,725
------------
NETHERLANDS--6.3%
ASM Lithography Holding NV (Equipment
(Semiconductor)) (b)...................... 13,265 1,473,592
Elsevier NV (Publishing).................... 68,124 813,728
Equant NV (Services (Data Processing))
(b)....................................... 19,629 2,228,007
Fortis (NL) NV (Financial (Diversified)).... 40,310 1,451,387
Heineken NV (Beverages (Alcoholic))......... 21,351 1,041,208
IHC Caland NV (Oil & Gas (Drilling &
Equipment))............................... 13,665 498,898
ING Groep NV (Financial (Diversified))...... 30,896 1,865,149
KPN NV (Telephone).......................... 18,572 1,812,495
Koninklijke (Royal) Philips Electronics NV
(Electronics (Component Distributors)).... 16,346 2,222,490
Royal Dutch Petroleum Co. (Oil (Domestic
Integrated)).............................. 24,562 1,505,285
STMicroelectronics NV (Electronics
(Semiconductors))......................... 8,950 1,377,339
Unilever NV CVA (Foods)..................... 23,734 1,310,880
United Pan-Europe Communications NV
(Broadcasting (Television, Radio & Cable))
(b)....................................... 5,811 743,274
Wolters Kluwer NV (Publishing).............. 15,198 514,304
------------
18,858,036
------------
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
NEW ZEALAND--0.2%
Telecom Corporation of New Zealand Ltd.
(Telephone)............................... 100,000 $ 470,249
------------
PHILIPPINES--0.5%
Ayala Land, Inc. (Financial
(Diversified))............................ 5,700,000 1,485,112
------------
POLAND--0.2%
Elektrim Spolka Akcyjna SA (Distributors
(Food & Health)) (b)...................... 54,000 535,429
------------
PORTUGAL--0.2%
Portugal Telecom SA (Telephone)............. 65,470 718,067
------------
SINGAPORE--1.5%
Singapore Airlines Ltd. (Airlines).......... 195,000 2,212,849
United Overseas Bank Ltd. (Banks (Major
Regional))................................ 264,000 2,330,111
------------
4,542,960
------------
SOUTH AFRICA--0.6%
BOE Ltd. (Financial (Diversified)).......... 302,150 294,541
De Beers (Metals Mining).................... 22,160 644,458
Metro Cash and Carry Ltd. (Retail
(Specialty)).............................. 683,000 776,767
------------
1,715,766
------------
SOUTH KOREA--1.2%
Kookmin Bank (Banks (Major Regional))....... 126,551 1,983,803
Pohang Iron & Steel Co., Ltd. (Iron &
Steel).................................... 12,500 1,474,662
------------
3,458,465
------------
SPAIN--2.6%
Argentaria, Caja Postal y Banco Hipotecario
de Espana SA (Banks (Major Regional))..... 45,616 1,071,831
Banco Popular Espanol SA (Banks (Major
Regional))................................ 21,396 1,395,298
Banco Santander Central Hispano SA (Banks
(Major Regional))......................... 75,633 856,194
Groupo Dragados SA (Engineering &
Construction)............................. 47,202 416,446
Iberdrola SA (Electric Companies)........... 58,539 811,257
Repsol-YPF SA (Oil & Gas (Refining &
Marketing))............................... 51,093 1,184,571
Telefonica SA (Telephone) (b)............... 84,237 2,104,016
------------
7,839,613
------------
SWEDEN--4.6%
ABB Ltd. (Electrical Equipment) (b)......... 9,928 1,210,077
AstraZeneca Group PLC (Health Care
(Drugs-Major Pharmaceuticals))............ 11,944 505,388
Electrolux AB Series B (Household
Furnishings &
Appliances)............................... 63,503 1,597,278
SKF AB (Metal Fabricators).................. 24,324 591,804
SSAB Svenskt Stal AB Series A (Iron &
Steel).................................... 87,909 1,363,891
Sandvik AB Class B (Machinery
(Diversified))............................ 22,508 716,933
Skandia Forsakrings AB (Insurance
(Life/Health))............................ 76,755 2,318,528
Skandinaviska Enskilda Banken Class A (Banks
(Major Regional))......................... 110,452 1,116,464
Telefonaktiebolaget LM Ericsson Class B
(Communications Equipment)................ 69,049 4,439,328
------------
13,859,691
------------
SWITZERLAND--4.7%
Credit Suisse Group (Banks (Major
Regional))................................ 8,473 1,684,170
Nestle SA (Foods)........................... 1,037 1,899,723
Novartis AG Registered Shares (Health Care
(Drugs-Major Pharmaceuticals))............ 1,663 2,441,810
Roche Holding AG (Health Care (Drugs-Major
Pharmaceuticals))......................... 234 2,777,492
Swisscom AG (Telephone)..................... 2,679 1,083,512
Synthes-Stratec, Inc. (Health Care (Medical
Products & Supplies)) (b)................. 1,530 700,477
UBS AG (Banks (Major Regional))............. 8,365 2,258,965
</TABLE>
See Notes to Financial Statements
5
<PAGE>
PHOENIX-ABERDEEN INTERNATIONAL SERIES
<TABLE>
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
SWITZERLAND--CONTINUED
Zurich Allied AG (Financial
(Diversified))............................ 1,857 $ 1,058,944
------------
13,905,093
------------
TAIWAN--0.1%
Standard Foods Taiwan Ltd. GDR (Foods)
(b)....................................... 59,210 244,241
------------
THAILAND--0.5%
BEC World Public Co. Ltd. (Entertainment)... 220,000 1,553,697
------------
TURKEY--0.4%
Haci Omer Sabanci Holding AS (Investment
Management)............................... 6,957,000 404,029
Yapi ve Kredi Bankasi AS (Banks (Major
Regional))................................ 25,280,000 780,678
------------
1,184,707
------------
UNITED KINGDOM--16.9%
3i Group PLC (Investment
Banking/Brokerage)........................ 99,994 1,784,800
AstraZeneca Group PLC (Health Care
(Drugs-Major Pharmaceuticals))............ 51,035 2,116,978
BG Group PLC (Natural Gas).................. 107,720 696,000
BOC Group PLC (Chemicals (Specialty))....... 31,744 681,972
BP Amoco PLC (Oil (Domestic Integrated)).... 431,796 4,341,814
Bank of Scotland (Banks (Major Regional))... 110,125 1,278,993
Barclays PLC (Banks (Major Regional))....... 48,280 1,389,723
Bass PLC (Beverages (Alcoholic))............ 60,752 756,113
Berkeley Group PLC (The) (Homebuilding)..... 60,127 694,431
British Aerospace PLC (Aerospace/Defense)... 125,012 827,921
British American Tobacco PLC (Tobacco)...... 84,730 481,420
British Telecommunications PLC
(Telephone)............................... 167,252 4,087,554
Cable & Wireless PLC (Telephone)............ 75,728 1,283,173
Colt Telecom Group PLC (Telephone) (b)...... 16,000 819,022
Compass Group PLC (Services (Commercial &
Consumer))................................ 37,043 508,602
Diageo PLC (Beverages (Alcoholic)).......... 55,032 442,688
Dixons Group PLC (Retail (Computers &
Electronics))............................. 19,100 459,390
FirstGroup PLC (Services (Commercial &
Consumer))................................ 148,761 582,712
Glaxo Wellcome PLC (Health Care (Drugs-Major
Pharmaceuticals))......................... 94,455 2,670,031
Granada Group PLC (Restaurants)............. 66,102 670,010
HSBC Holdings PLC (Financial
(Diversified))............................ 159,500 2,223,436
Hilton Group PLC (Gaming, Lottery &
Pari-mutuel Companies) (b)................ 175,739 562,775
Invensys PLC (Machinery (Diversified))...... 165,671 901,840
Legal & General Group PLC (Insurance
(Multi-Line))............................. 383,999 1,045,161
Lloyds TSB Group PLC (Financial
(Diversified))............................ 155,800 1,949,136
Logica PLC (Services (Data Processing))..... 69,971 1,804,996
National Westminster Bank PLC (Banks (Major
Regional))................................ 70,910 1,523,394
Norwich Union PLC (Insurance
(Life/Health))............................ 108,439 803,116
RMC Group PLC (Construction (Cement &
Aggregates)).............................. 53,128 716,577
Reuters Holdings Group PLC (Publishing)..... 43,287 593,983
Rio Tinto PLC (Metals Mining)............... 56,287 1,359,260
Royal & Sun Alliance Insurance Group PLC
(Insurance (Multi-Line)).................. 117,696 896,389
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
UNITED KINGDOM--CONTINUED
Sage Group PLC (The) (Computers (Software &
Services))................................ 41,300 $ 504,008
Schroders PLC (Investment
Banking/Brokerage)........................ 31,660 637,209
Serco Group PLC (Services (Commercial &
Consumer))................................ 20,202 633,882
Shell Transport & Trading Co. PLC (Oil
(Domestic Integrated)).................... 198,794 1,652,121
SmithKline Beecham PLC (Health Care
(Drugs-Major Pharmaceuticals))............ 122,628 1,564,840
Smiths Industries PLC (Aerospace/Defense)... 30,485 446,875
Thames Water PLC (Water Utilities).......... 31,422 391,836
Vodafone AirTouch PLC (Telecommunications
(Cellular/Wireless))...................... 683,811 3,388,238
Woolwich PLC (Consumer Finance)............. 82,083 453,453
------------
50,625,872
------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $223,094,751)............................ 289,848,558
------------
COMMON STOCKS--0.2%
UNITED STATES--0.2%
Viatel, Inc. (Telecommunications (Long
Distance)) (b)............................ 8,392 450,021
------------
TOTAL COMMON STOCKS
(Identified cost $389,913)................................ 450,021
------------
WARRANTS--0.0%
BELGIUM--0.0%
Dexia Strips (Banks (Major Regional)) (b)... 7,400 373
------------
GERMANY--0.0%
Muenchener Rueckversicherungs-Gesellschaft
AG Warrants (Insurance (Multi-Line))
(b)....................................... 220 11,699
------------
TOTAL WARRANTS
(Identified cost $0)...................................... 12,072
------------
TOTAL LONG-TERM INVESTMENTS--97.1%
(Identified cost $223,484,664)............................ 290,310,651
------------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000)
----------- --------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--3.1%
COMMERCIAL PAPER--3.1%
Anheuser Busch Cos., Inc. 4.50%,
1/3/00............................. A-1 $5,200 5,198,700
Koch Industries, Inc. 7.50%,
1/3/00............................. A-1+ 3,920 3,918,367
-----------
9,117,067
-----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $9,117,067)................................. 9,117,067
-----------
TOTAL INVESTMENTS--100.2%
(Identified cost $232,601,731)............................... 299,427,718(a)
Cash and receivables, less liabilities--(0.2%)............... (454,981)
-----------
NET ASSETS--100.0%............................................. $298,972,737
===========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $74,848,165 and gross depreciation of $9,589,883 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purposes
was $234,169,436.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
6
<PAGE>
PHOENIX-ABERDEEN INTERNATIONAL SERIES
INDUSTRY DIVERSIFICATION
AS A PERCENTAGE OF TOTAL VALUE OF
TOTAL LONG-TERM INVESTMENTS
(UNAUDITED)
<TABLE>
<S> <C>
Aerospace/Defense....................................... 0.4%
Air Freight............................................. 0.7
Airlines................................................ 1.5
Auto Parts & Equipment.................................. 0.4
Automobiles............................................. 1.8
Banks (Major Regional).................................. 10.9
Banks (Money Center).................................... 1.4
Beverages (Alcoholic)................................... 1.5
Beverages (Non-Alcoholic)............................... 0.3
Broadcasting (Television, Radio & Cable)................ 1.0
Chemicals (Diversified)................................. 1.0
Chemicals (Specialty)................................... 1.5
Communications Equipment................................ 8.3
Computers (Hardware).................................... 0.9
Computers (Software & Services)......................... 0.2
Construction (Cement & Aggregates)...................... 1.3
Consumer Finance........................................ 0.8
Containers & Packaging (Paper).......................... 0.5
Distributors (Food & Health)............................ 0.2
Electric Companies...................................... 0.8
Electrical Equipment.................................... 1.9
Electronics (Component Distributors).................... 0.8
Electronics (Semiconductors)............................ 1.9
Engineering & Construction.............................. 0.6
Entertainment........................................... 1.6
Equipment (Semiconductor)............................... 0.5
Financial (Diversified)................................. 3.8
Foods................................................... 1.5
Gaming, Lottery & Pari-Mutuel Companies................. 0.2
Health Care (Diversified)............................... 0.3
Health Care (Drugs-Major Pharmaceuticals)............... 5.0
Health Care (Medical Products & Supplies)............... 0.2
Homebuilding............................................ 0.2
Household Furnishings & Appliances...................... 2.3
Household Products (Non-Durable)........................ 0.7
Insurance (Life/Health)................................. 1.4
Insurance (Multi-Line).................................. 2.8
Insurance (Property-Casualty)........................... 0.9
Investment Banking/Brokerage............................ 1.7
Investment Management................................... 0.1
Iron & Steel............................................ 1.0
Machinery (Diversified)................................. 0.5
Manufacturing (Diversified)............................. 3.0
Metal Fabricators....................................... 0.6
Metals Mining........................................... 0.7
Natural Gas............................................. 0.8
Office Equipment & Supplies............................. 0.9
Oil & Gas (Drilling & Equipment)........................ 0.2
Oil & Gas (Exploration & Production).................... 0.1
Oil & Gas (Refining & Marketing)........................ 1.6
Oil (Domestic Integrated)............................... 3.0
Paper & Forest Products................................. 0.6
Photography/Imaging..................................... 0.7
Publishing.............................................. 0.7
Restaurants............................................. 0.2
Retail (Building Supplies).............................. 0.7
Retail (Computers & Electronics)........................ 0.1
Retail (Food Chains).................................... 2.2
Retail (Specialty)...................................... 0.8
Services (Commercial & Consumer)........................ 1.3
Services (Data Processing).............................. 1.4
Specialty Printing...................................... 0.7
Telecommunications (Cellular/Wireless).................. 2.5
Telecommunications (Long Distance)...................... 2.5
Telephone............................................... 9.1
Tobacco................................................. 0.2
Water Utilities......................................... 0.1
-----
100.0%
=====
</TABLE>
See Notes to Financial Statements
7
<PAGE>
PHOENIX-ABERDEEN INTERNATIONAL SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$232,601,731)............................................. $299,427,718
Cash........................................................ 4,450
Foreign currency at value (identified cost $1,104).......... 1,133
Receivables
Dividends and interest.................................... 163,482
Fund shares sold.......................................... 79,126
Investment securities sold................................ 2,216
Tax reclaim............................................... 240,023
Prepaid expenses............................................ 3,742
------------
Total assets............................................ 299,921,890
------------
LIABILITIES
Payables
Fund shares repurchased................................... 508,699
Investment advisory fee................................... 179,895
Financial agent fee....................................... 22,474
Trustees' fee............................................. 6,958
Accrued expenses............................................ 231,127
------------
Total liabilities....................................... 949,153
------------
NET ASSETS.................................................. $298,972,737
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $228,717,616
Distribution in excess of net investment income........... (1,446,518)
Accumulated net realized gain............................. 4,885,170
Net unrealized appreciation............................... 66,816,469
------------
NET ASSETS.................................................. $298,972,737
============
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 17,397,167
============
Net asset value and offering price per share................ $ 17.19
============
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 4,324,236
Interest.................................................. 639,566
Foreign taxes withheld.................................... (320,656)
-----------
Total investment income................................. 4,643,146
-----------
EXPENSES
Investment advisory fee................................... 1,915,372
Financial agent fee....................................... 238,359
Custodian................................................. 284,583
Printing.................................................. 81,329
Professional.............................................. 25,658
Trustees.................................................. 14,191
Miscellaneous............................................. 26,522
-----------
Total expenses.......................................... 2,586,014
-----------
NET INVESTMENT INCOME....................................... 2,057,132
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 31,367,227
Net realized loss on foreign currency transactions........ (21,716)
Net change in unrealized appreciation (depreciation) on
investments............................................. 35,695,363
Net change in unrealized appreciation (depreciation) on
foreign currency and foreign currency transactions...... 5,723
-----------
NET GAIN ON INVESTMENTS..................................... 67,046,597
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $69,103,729
===========
</TABLE>
See Notes to Financial Statements
8
<PAGE>
PHOENIX-ABERDEEN INTERNATIONAL SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
------------------- ------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 2,057,132 $ 1,631,804
Net realized gain (loss).................................. 31,345,511 51,043,087
Net change in unrealized appreciation (depreciation)...... 35,701,086 150,814
------------ ------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 69,103,729 52,825,705
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (3,265,818) --
Net realized gains........................................ (36,259,691) (41,161,214)
In excess of net investment income........................ (1,780,524) --
------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (41,306,033) (41,161,214)
------------ ------------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (3,885,702 and 3,647,895
shares, respectively)................................... 62,660,967 63,751,174
Net asset value of shares issued from reinvestment of
distributions (2,492,331 and 2,641,331 shares,
respectively)........................................... 41,306,033 41,161,214
Cost of shares repurchased (4,632,721 and 3,994,250
shares, respectively)................................... (74,706,908) (68,770,405)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 29,260,092 36,141,983
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS..................... 57,057,788 47,806,474
NET ASSETS
Beginning of period....................................... 241,914,949 194,108,475
------------ ------------
END OF PERIOD (INCLUDING DISTRIBUTIONS IN EXCESS OF NET
INVESTMENT INCOME AND UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF ($1,446,518) AND $1,208,686,
RESPECTIVELY)........................................... $298,972,737 $241,914,949
============ ============
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------------
1999 1998 1997 1996 1995
------------ -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period................... $ 15.46 $ 14.53 $ 14.52 $ 12.70 $ 11.85
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss)......................... 0.23 0.12(1) 0.12(1) 0.11(1) 0.12(1)
Net realized and unrealized gain (loss).............. 4.13 3.94 1.61 2.25 1.02
-------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS................... 4.36 4.06 1.73 2.36 1.14
-------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Dividends from net investment income................. (0.25) -- (0.22) (0.19) (0.04)
Dividends from net realized gains.................... (2.24) (3.13) (1.50) (0.33) (0.25)
In excess of net investment income................... (0.14) -- -- (0.02) --
-------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS................................ (2.63) (3.13) (1.72) (0.54) (0.29)
-------- -------- -------- -------- --------
CHANGE IN NET ASSET VALUE.............................. 1.73 0.93 0.01 1.82 0.85
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD......................... $ 17.19 $ 15.46 $ 14.53 $ 14.52 $ 12.70
======== ======== ======== ======== ========
Total return........................................... 29.49% 27.92% 12.04% 18.65% 9.59%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands).................. $298,973 $241,915 $194,108 $172,668 $134,455
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses................................... 1.01% 0.98% 1.01% 1.04% 1.07%
Net investment income................................ 0.81% 0.72% 0.72% 0.80% 0.95%
Portfolio turnover rate................................ 79% 93% 184% 142% 249%
</TABLE>
(1) Computed using average shares outstanding.
See Notes to Financial Statements
9
<PAGE>
PHOENIX-ENGEMANN CAPITAL GROWTH SERIES
INVESTMENT OBJECTIVE
The Fund is appropriate for investors seeking long-term capital
appreciation.
INVESTMENT ADVISER'S REPORT
For the 12 months ended December 31, 1999, the Fund returned 29.67% compared
with a return of 21.14% for the S&P 500 Index*. All performance figures assume
reinvestment of dividends and are net of sales charges.
Tech stocks were the runaway market leaders in 1999, and we were rewarded
for our increased emphasis on this sector. It is interesting to note that the
return for the S&P 500 Index excluding technology stocks was only 3.1%. Many of
largest holdings were tech stocks, some with gains of 100%+.
The portfolio also benefited from underweighted positions in financials and
health care, which lagged the market for the year. However, careful stock
selection within the financial group proved to be a plus, with both Citigroup
and American Express up substantially for the year. Several consumer cyclical
stocks also enhanced performance; for example, Home Depot, Wal-Mart, and
Interpublic Group.
OUTLOOK
With lofty stock prices and the relentless market climb, particularly in
dot.com issues, there is apt to be a large dose of volatility ahead. Signs of
that have already emerged in the early days of 2000. The threat of rising
interest rates will also add to nervous investor behavior.
However, even with the expected hikes in interest rates, there appears
little on the horizon that could cause a dramatic reversal in the coming months.
The economy is strong, inflation looks as if it will remain tame, and the
outlook for earnings appears positive. Such ingredients are typically conducive
to a healthy stock market in which high quality, large-cap companies can thrive.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CAPITAL GROWTH SERIES S&P 500 INDEX*
<S> <C> <C>
12/31/89 $10,000.00 $10,000.00
12/31/90 $10,408.81 $9,680.55
12/31/91 $14,958.56 $12,637.34
12/31/92 $16,497.70 $13,609.25
12/31/93 $19,746.70 $14,970.18
12/31/94 $20,038.80 $15,168.24
12/31/95 $26,219.94 $20,857.44
12/31/96 $29,518.25 $25,706.31
12/31/97 $35,738.71 $34,285.94
12/31/98 $46,464.60 $44,145.38
12/31/99 $60,251.89 $53,475.55
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C> <C>
1 YEAR 5 YEARS 10 YEARS
- -------------------------------------------------------------------------------------------
Capital Growth Series 29.67% 24.63% 19.67%
- -------------------------------------------------------------------------------------------
S&P 500 Index* 21.14% 28.66% 18.25%
- -------------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 12/31/89.
Returns shown include the reinvestment of all distributions at net asset value,
and the change in share price for the stated period. Returns indicate past
performance, which is not predictive of future performance. Investment return
and net asset value will fluctuate so that your shares, when redeemed, may be
worth more or less than the original cost. Foreign investing involves special
risks such as currency fluctuation and less public disclosure, as well as
economic and political risks.
* The S&P 500 Index is an unmanaged, commonly used measure of total return stock
market performance. The Index is not available for direct investment.
10
<PAGE>
PHOENIX-ENGEMANN CAPITAL GROWTH SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
----------- --------------
<S> <C> <C> <C>
COMMON STOCKS--95.4%
BANKS (MAJOR REGIONAL)--1.6%
Wells Fargo Co............................ 872,500 $ 35,281,719
--------------
BROADCASTING (TELEVISION, RADIO & CABLE)--3.9%
AT&T Corp.- Liberty Media Group Class A
(b)..................................... 999,400 56,715,950
CBS Corp. (b)............................. 223,500 14,290,031
Clear Channel Communications, Inc. (b).... 186,800 16,671,900
--------------
87,677,881
--------------
COMMUNICATIONS EQUIPMENT--4.5%
Lucent Technologies, Inc.................. 961,100 71,902,294
Tellabs, Inc. (b)......................... 451,400 28,974,237
--------------
100,876,531
--------------
COMPUTERS (HARDWARE)--6.0%
Dell Computer Corp. (b)................... 539,300 27,504,300
International Business Machines Corp...... 557,350 60,193,800
Sun Microsystems, Inc. (b)................ 629,600 48,754,650
--------------
136,452,750
--------------
COMPUTERS (NETWORKING)--3.5%
Cisco Systems, Inc. (b)................... 747,150 80,038,444
--------------
COMPUTERS (PERIPHERALS)--3.3%
EMC Corp. (b)............................. 690,650 75,453,512
--------------
COMPUTERS (SOFTWARE & SERVICES)--16.3%
America Online, Inc. (b).................. 851,700 64,250,119
BEA Systems, Inc. (b)..................... 226,000 15,805,875
BMC Software, Inc. (b).................... 188,850 15,096,197
Citrix Systems, Inc. (b).................. 114,000 14,022,000
Computer Associates International, Inc.... 167,000 11,679,562
Compuware Corp. (b)....................... 250,900 9,346,025
Edwards (J.D.) & Co. (b).................. 164,000 4,899,500
Legato Systems, Inc. (b).................. 87,000 5,986,687
Microsoft Corp. (b)....................... 1,035,400 120,882,950
Oracle Corp. (b).......................... 270,000 30,256,875
Peregrine Systems, Inc. (b)............... 94,000 7,766,750
Siebel Systems, Inc. (b).................. 176,000 14,784,000
VERITAS Software Corp. (b)................ 81,000 11,593,125
Yahoo!, Inc. (b).......................... 57,550 24,901,166
i2 Technologies, Inc. (b)................. 98,000 19,110,000
--------------
370,380,831
--------------
CONSUMER FINANCE--1.2%
Capital One Financial Corp................ 218,800 10,543,425
Countrywide Credit Industries, Inc........ 300,000 7,575,000
MBNA Corp................................. 353,000 9,619,250
--------------
27,737,675
--------------
ELECTRICAL EQUIPMENT--3.2%
Flextronics International Ltd. (b)........ 128,000 5,888,000
General Electric Co....................... 360,700 55,818,325
Sanmina Corp. (b)......................... 44,900 4,484,387
Solectron Corp. (b)....................... 67,500 6,420,937
--------------
72,611,649
--------------
ELECTRONICS (SEMICONDUCTORS)--7.6%
Intel Corp................................ 899,400 74,031,862
JDS Uniphase Corp. (b).................... 64,000 10,324,000
Linear Technology Corp.................... 66,000 4,723,125
Maxim Integrated Products, Inc. (b)....... 122,000 5,756,875
Texas Instruments, Inc.................... 748,900 72,549,687
Xilinx, Inc. (b).......................... 122,000 5,547,187
--------------
172,932,736
--------------
<CAPTION>
SHARES VALUE
----------- --------------
<S> <C> <C> <C>
ENTERTAINMENT--0.7%
Time Warner, Inc.......................... 217,950 $ 15,787,753
--------------
EQUIPMENT (SEMICONDUCTOR)--1.3%
Applied Materials, Inc. (b)............... 70,000 8,868,125
KLA-Tencor Corp. (b)...................... 60,000 6,682,500
Novellus Systems, Inc. (b)................ 61,000 7,474,406
Teradyne, Inc. (b)........................ 106,000 6,996,000
--------------
30,021,031
--------------
FINANCIAL (DIVERSIFIED)--7.8%
American Express Co....................... 73,500 12,219,375
Citigroup, Inc............................ 1,778,975 98,844,298
Freddie Mac............................... 697,700 32,835,506
Morgan Stanley Dean Witter & Co........... 238,650 34,067,288
--------------
177,966,467
--------------
HEALTH CARE (DIVERSIFIED)--1.8%
Bristol-Myers Squibb Co................... 251,200 16,123,900
Warner-Lambert Co......................... 296,000 24,253,500
--------------
40,377,400
--------------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--4.0%
Genentech, Inc. (b)....................... 180,000 24,210,000
Merck & Co., Inc.......................... 49,250 3,302,828
Pfizer, Inc............................... 1,695,100 54,984,806
Schering-Plough Corp...................... 205,250 8,658,984
--------------
91,156,618
--------------
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)--1.9%
Medtronic, Inc............................ 1,175,200 42,821,350
--------------
INSURANCE (MULTI-LINE)--1.0%
American International Group, Inc......... 202,512 21,896,610
--------------
INVESTMENT BANKING/BROKERAGE--2.2%
Goldman Sachs Group, Inc. (The)........... 318,000 29,951,625
Merrill Lynch & Co., Inc.................. 235,500 19,664,250
--------------
49,615,875
--------------
LODGING-HOTELS--0.9%
Carnival Corp............................. 445,900 21,319,594
--------------
MANUFACTURING (DIVERSIFIED)--1.9%
Honeywell International, Inc.............. 228,000 13,152,750
Tyco International Ltd.................... 423,300 16,455,788
United Technologies Corp.................. 200,000 13,000,000
--------------
42,608,538
--------------
RETAIL (BUILDING SUPPLIES)--3.3%
Home Depot, Inc. (The).................... 1,096,050 75,147,928
--------------
RETAIL (COMPUTERS & ELECTRONICS)--1.4%
Best Buy Co., Inc. (b).................... 285,000 14,303,438
Circuit City Stores-Circuit City Group.... 400,000 18,025,000
--------------
32,328,438
--------------
RETAIL (DEPARTMENT STORES)--0.5%
Kohl's Corp. (b).......................... 142,250 10,268,672
--------------
RETAIL (DRUG STORES)--1.0%
Walgreen Co............................... 806,000 23,575,500
--------------
RETAIL (GENERAL MERCHANDISE)--3.4%
Costco Wholesale Corp. (b)................ 268,300 24,482,375
Dayton Hudson Corp........................ 165,000 12,117,188
Wal-Mart Stores, Inc...................... 580,500 40,127,063
--------------
76,726,626
--------------
</TABLE>
See Notes to Financial Statements
11
<PAGE>
PHOENIX-ENGEMANN CAPITAL GROWTH SERIES
<TABLE>
<CAPTION>
SHARES VALUE
----------- --------------
<S> <C> <C> <C>
RETAIL (SPECIALTY)--0.8%
Staples, Inc. (b)......................... 826,825 $ 17,156,619
--------------
SERVICES (ADVERTISING/MARKETING)--1.1%
Interpublic Group of Companies, Inc.
(The)................................... 424,400 24,482,575
--------------
SERVICES (COMMERCIAL & CONSUMER)--1.7%
Cendant Corp. (b)......................... 1,478,400 39,270,000
--------------
SERVICES (COMPUTER SYSTEMS)--1.4%
Electronic Data Systems Corp.............. 484,400 32,424,525
--------------
SERVICES (DATA PROCESSING)--0.3%
Automatic Data Processing, Inc............ 138,000 7,434,750
--------------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--0.3%
VoiceStream Wireless Corp. (b)............ 55,000 7,827,188
--------------
TELECOMMUNICATIONS (LONG DISTANCE)--5.0%
AT&T Corp................................. 237,853 12,071,040
MCI WorldCom, Inc. (b).................... 1,805,691 95,814,479
Qwest Communications International, Inc.
(b)..................................... 111,000 4,773,000
--------------
112,658,519
--------------
TELEPHONE--0.6%
Bell Atlantic Corp........................ 61,000 3,755,313
BellSouth Corp............................ 205,000 9,596,563
--------------
13,351,876
--------------
TOTAL COMMON STOCKS
(Identified cost $1,347,661,138)........................ 2,165,668,180
--------------
FOREIGN COMMON STOCKS--0.8%
COMMUNICATIONS EQUIPMENT--0.3%
Nokia Oyj Sponsored ADR (Finland)......... 39,000 7,410,000
--------------
ENTERTAINMENT--0.5%
News Corporation Ltd. (The) Sponsored ADR
(Australia)............................. 278,000 10,633,500
--------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $14,853,688)........................... 18,043,500
--------------
TOTAL LONG-TERM INVESTMENTS--96.2%
(Identified cost $1,362,514,826)........................ 2,183,711,680
--------------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- ------- --------------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--3.9%
CERTIFICATES OF DEPOSIT--0.1%
ABN AMRO Bank 5.75%, 7/3/00....... AA $ 2,500 $ 2,494,228
--------------
COMMERCIAL PAPER--3.7%
Pitney Bowes, Inc. 6.60%,
1/4/00.......................... A-1+ 10,000 9,994,500
Ford Motor Credit Co. 4.79%,
1/7/00.......................... A-1+ 12,855 12,844,737
Marsh & USA, Inc. 6.50%,
1/12/00......................... A-1+ 5,000 4,990,070
Albertson's, Inc. 5.89%,
1/14/00......................... A-1 2,540 2,534,598
Enterprise Funding Corp. 5.98%,
1/14/00......................... A-1+ 621 619,659
Preferred Receivables Funding
Corp. 6.75%, 1/19/00............ A-1 6,000 5,979,750
Cargill, Inc. 5.40%, 1/21/00...... A-1 1,500 1,495,242
General Electric Capital Corp.
6.55%, 1/24/00.................. A-1+ 5,000 4,979,076
Merrill Lynch & Co. 5.60%,
1/26/00......................... A-1+ 6,500 6,474,722
Bavaria Universal Funding Corp.
6.55%, 2/16/00.................. A-1+ 3,000 2,999,841
Private Export Funding Corp.
6.05%, 2/16/00.................. A-1+ 10,000 9,925,394
Ford Motor Credit Co. 5.50%,
2/25/00......................... A-1 10,000 9,915,972
Bavaria Universal Funding Corp.
6.10%, 3/14/00.................. A-1+ 2,500 2,472,241
Lexington Parker Capital Co. LLC
6.15%, 3/17/00.................. A-1 8,600 8,499,413
--------------
83,725,215
--------------
MEDIUM-TERM NOTES--0.1%
Associates Corporation of North
America 9.125%, 4/1/00.......... AA- 1,000 1,006,562
--------------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $87,243,186)............................ 87,226,005
--------------
TOTAL INVESTMENTS--100.1%
(Identified cost $1,449,758,012)......................... 2,270,937,685(a)
Cash and receivables, less liabilities--(0.1%)........... (1,847,776)
--------------
NET ASSETS--100.0%......................................... $2,269,089,909
==============
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $846,771,330 and gross depreciation of $27,487,473 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purposes
was $1,451,653,828.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
12
<PAGE>
PHOENIX-ENGEMANN CAPITAL GROWTH SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$1,449,758,012)........................................... $2,270,937,685
Cash........................................................ 5,271
Receivables
Fund shares sold.......................................... 870,328
Dividends and interest.................................... 562,145
Prepaid expenses............................................ 27,606
--------------
Total assets............................................ 2,272,403,035
--------------
LIABILITIES
Payables
Investment securities purchased...........................
Fund shares repurchased................................... 1,754,630
Investment advisory fee................................... 1,143,226
Financial agent fee....................................... 47,010
Trustees' fee............................................. 6,958
Accrued expenses............................................ 361,302
--------------
Total liabilities....................................... 3,313,126
--------------
NET ASSETS.................................................. $2,269,089,909
==============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $1,372,671,786
Accumulated net realized gain............................. 75,238,450
Net unrealized appreciation............................... 821,179,673
--------------
NET ASSETS.................................................. $2,269,089,909
==============
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 79,413,319
==============
Net asset value and offering price per share................ $ 28.57
==============
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 10,519,687
Interest.................................................. 4,844,305
Foreign taxes withheld.................................... (31,899)
------------
Total investment income................................. 15,332,093
------------
EXPENSES
Investment advisory fee................................... 12,019,040
Financial agent fee....................................... 543,497
Custodian................................................. 307,441
Printing.................................................. 216,747
Professional.............................................. 49,961
Trustees.................................................. 16,286
Miscellaneous............................................. 57,938
------------
Total expenses.......................................... 13,210,910
------------
NET INVESTMENT INCOME....................................... 2,121,183
------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 220,161,925
Net change in unrealized appreciation (depreciation) on
investments............................................. 305,492,893
------------
NET GAIN ON INVESTMENTS..................................... 525,654,818
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $527,776,001
============
</TABLE>
See Notes to Financial Statements
13
<PAGE>
PHOENIX-ENGEMANN CAPITAL GROWTH SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
--------------- -------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 2,121,183 $ 2,502,083
Net realized gain (loss).................................. 220,161,925 45,867,063
Net change in unrealized appreciation (depreciation)...... 305,492,893 390,908,702
-------------- --------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 527,776,001 439,277,848
-------------- --------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (3,406,384) (2,092,243)
Net realized capital gains................................ (172,333,179) (67,564,709)
In excess of net investment income........................ (1,142,985) --
-------------- --------------
DECREASE IN NET ASSETS FROM DISTRIBUTION TO
SHAREHOLDERS............................................ (176,882,548) (69,656,952)
-------------- --------------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (10,765,692 and 14,661,827
shares, respectively)................................... 269,095,856 306,260,617
Net asset value of shares issued from reinvestment of
distributions (6,349,314 and 3,143,060 shares,
respectively)........................................... 176,882,547 69,656,952
Cost of shares repurchased (16,111,408 and 17,964,177
shares, respectively)................................... (405,221,233) (374,810,017)
Capital contribution from Adviser (See Note 3)............ 1,142,985 --
-------------- --------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 41,900,155 1,107,552
-------------- --------------
NET INCREASE IN NET ASSETS................................ 392,793,608 370,728,448
NET ASSETS
Beginning of period....................................... 1,876,296,301 1,505,567,853
-------------- --------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $0 AND $1,285,201, RESPECTIVELY)....... $2,269,089,909 $1,876,296,301
============== ==============
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1999 1998 1997 1996 1995
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period........................ $23.93 $19.16 $18.89 $18.13 $15.69
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.03 0.03 0.13 0.19 0.20
Net realized and unrealized gain (loss)................... 6.97 5.65 3.70 2.10 4.60
------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS........................ 7.00 5.68 3.83 2.29 4.80
------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.05) (0.03) (0.13) (0.18) (0.17)
Dividends from net realized gains......................... (2.31) (0.88) (3.43) (1.35) (2.19)
In excess of net investment income........................ (0.01) -- -- -- --
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS..................................... (2.37) (0.91) (3.56) (1.53) (2.36)
------ ------ ------ ------ ------
Capital contribution from Adviser......................... 0.01 -- -- -- --
------ ------ ------ ------ ------
CHANGE IN NET ASSET VALUE................................... 4.64 4.77 0.27 0.76 2.44
------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD.............................. $28.57 $23.93 $19.16 $18.89 $18.13
====== ====== ====== ====== ======
Total return................................................ 29.67% 30.01% 21.07% 12.58% 30.85%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $2,269,090 $1,876,296 $1,505,568 $1,235,395 $985,389
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses........................................ 0.68% 0.69% 0.74% 0.72% 0.75%(1)
Net investment income..................................... 0.11% 0.15% 0.64% 1.03% 1.12%
Portfolio turnover rate..................................... 106% 102% 284% 167% 173%
</TABLE>
(1) The ratio of operating expenses to average net assets excludes the effect of
expense offsets for custodian fees; if expense offsets were included, the
ratio would not significantly differ.
See Notes to Financial Statements
14
<PAGE>
PHOENIX-ENGEMANN NIFTY FIFTY SERIES
INVESTMENT OBJECTIVE
The Fund has an investment objective of long-term growth of capital.
INVESTMENT ADVISER'S REPORT
We seek to achieve long-term capital appreciation by investing in
approximately 50 companies that the portfolio management team considers to have
the best prospects for appreciation potential. Our approach has been well
rewarded this year. For the 12 months ended December 31, 1999, the Fund returned
32.15% compared with a return of 21.14% for the S&P 500 Index*. All performance
figures assume the reinvestment of distributions and are net of sales charges.
While many of the major markets posted new highs, it wasn't a free-for-all
for stocks in general. Well over half the stocks on the New York Stock Exchange
and even the high-flying Nasdaq were selling at lower prices at year-end then
they did at the beginning of the year. Clearly it was a year in which good stock
selection reigned supreme.
Tech stocks were the runaway market leaders in 1999, and we were rewarded
for our increased emphasis on this sector. It is interesting to note that the
return for the S&P 500 Index excluding technology stocks was only 3.1%. Many of
largest holdings were tech stocks, some with gains of 100%+.
The portfolio also benefited from underweighted positions in financials and
health care, which lagged the market for the year. However, careful stock
selection within the financial group proved to be a plus, with both Citigroup
and American Express up substantially for the year. Several consumer cyclical
stocks also enhanced performance; for example, Home Depot, Wal-Mart, and
Interpublic Group
OUTLOOK
With lofty stock prices and the relentless market climb, particularly in
dot.com issues, there is apt to be a large dose of volatility ahead. Signs of
that have already emerged in the early days of 2000. The threat of rising
interest rates will also add to nervous investor behavior.
However, even with the expected hikes in interest rates, we believe there
appears little on the horizon that could cause a dramatic reversal in the coming
months. The economy is strong, inflation looks as if it will remain tame, and
the outlook for earnings appears positive. Such ingredients are typically
conducive to a healthy stock market in which high quality, large-cap companies
prosper.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NIFTY FIFTY SERIES S&P 500 INDEX*
<S> <C> <C>
3/2/1998 $10,000.00 $10,000.00
12/31/1998 $12,625.86 $11,895.30
12/31/1999 $16,685.15 $14,409.38
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C>
FROM
INCEPTION
3/2/98 TO
1 YEAR 12/31/99
- --------------------------------------------------------------------------------------
Nifty Fifty Series 32.15% 32.22%
- --------------------------------------------------------------------------------------
S&P 500 Index* 21.14% 22.06%
- --------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 3/2/98.
Returns shown include the reinvestment of all distributions at net asset value,
and the change in share price for the stated period. Returns indicate past
performance, which is not predictive of future performance. Investment return
and net asset value will fluctuate so that your shares, when redeemed, may be
worth more or less than the original cost. Foreign investing involves special
risks such as currency fluctuation and less public disclosure, as well as
economic and political risks.
* The S&P 500 Index is an unmanaged, commonly used measure of stock market total
return performance. The Index is not available for direct investment.
15
<PAGE>
PHOENIX-ENGEMANN NIFTY FIFTY SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
----------------------------------- -----------------------------------
<S> <C> <C> <C>
COMMON STOCKS--91.0%
BANKS (MAJOR REGIONAL)--1.0%
Wells Fargo Co............................. 16,250 $ 657,109
-----------------------------------
BROADCASTING (TELEVISION, RADIO & CABLE)--0.5%
AT&T Corp.- Liberty Media Group Class A
(b)...................................... 6,400 363,200
-----------------------------------
COMMUNICATIONS EQUIPMENT--6.7%
Lucent Technologies, Inc................... 33,900 2,536,144
Tellabs, Inc. (b).......................... 29,130 1,869,782
-----------------------------------
4,405,926
-----------------------------------
COMPUTERS (HARDWARE)--4.7%
Dell Computer Corp. (b).................... 12,170 620,670
International Business Machines Corp....... 12,160 1,313,280
Sun Microsystems, Inc. (b)................. 14,540 1,125,941
-----------------------------------
3,059,891
-----------------------------------
COMPUTERS (NETWORKING)--5.5%
Cisco Systems, Inc. (b).................... 33,810 3,621,896
-----------------------------------
COMPUTERS (PERIPHERALS)--5.7%
EMC Corp. (b).............................. 34,040 3,718,870
-----------------------------------
COMPUTERS (SOFTWARE & SERVICES)--11.6%
America Online, Inc. (b)................... 30,580 2,306,879
BMC Software, Inc. (b)..................... 14,470 1,156,696
Compuware Corp. (b)........................ 13,660 508,835
Microsoft Corp. (b)........................ 31,000 3,619,250
-----------------------------------
7,591,660
-----------------------------------
CONSUMER FINANCE--1.1%
MBNA Corp.................................. 27,280 743,380
-----------------------------------
ELECTRICAL EQUIPMENT--2.9%
General Electric Co........................ 12,130 1,877,117
-----------------------------------
ELECTRONICS (SEMICONDUCTORS)--7.8%
Intel Corp................................. 26,990 2,221,614
Texas Instruments, Inc..................... 29,810 2,887,844
-----------------------------------
5,109,458
-----------------------------------
ENTERTAINMENT--0.9%
Time Warner, Inc........................... 7,860 569,359
-----------------------------------
FINANCIAL (DIVERSIFIED)--6.0%
American Express Co........................ 4,820 801,325
Citigroup, Inc............................. 27,200 1,511,300
Freddie Mac................................ 12,140 571,339
Morgan Stanley Dean Witter & Co............ 7,260 1,036,365
-----------------------------------
3,920,329
-----------------------------------
HEALTH CARE (DIVERSIFIED)--1.0%
Warner-Lambert Co.......................... 7,880 645,667
-----------------------------------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--5.9%
Genentech, Inc. (b)........................ 7,270 977,815
Merck & Co., Inc........................... 13,650 915,403
Pfizer, Inc................................ 44,160 1,432,440
Schering-Plough Corp....................... 12,100 510,469
-----------------------------------
3,836,127
-----------------------------------
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)--2.7%
Guidant Corp. (b).......................... 7,970 374,590
Medtronic, Inc............................. 38,970 1,419,969
-----------------------------------
1,794,559
-----------------------------------
<CAPTION>
SHARES VALUE
----------------------------------- -----------------------------------
<S> <C> <C> <C>
INVESTMENT BANKING/BROKERAGE--1.6%
Goldman Sachs Group, Inc. (The)............ 3,880 $ 365,447
Merrill Lynch & Co., Inc................... 8,000 668,000
-----------------------------------
1,033,447
-----------------------------------
LODGING-HOTELS--1.7%
Carnival Corp.............................. 22,930 1,096,341
-----------------------------------
MANUFACTURING (DIVERSIFIED)--1.1%
Tyco International Ltd..................... 10,890 423,349
United Technologies Corp................... 4,840 314,600
-----------------------------------
737,949
-----------------------------------
PERSONAL CARE--0.6%
Gillette Co. (The)......................... 10,050 413,934
-----------------------------------
RETAIL (BUILDING SUPPLIES)--5.0%
Home Depot, Inc. (The)..................... 37,290 2,556,696
Lowe's Companies., Inc..................... 12,170 727,157
-----------------------------------
3,283,853
-----------------------------------
RETAIL (COMPUTERS & ELECTRONICS)--1.5%
Best Buy Co., Inc. (b)..................... 8,300 416,556
Circuit City Stores-Circuit City Group..... 12,190 549,312
-----------------------------------
965,868
-----------------------------------
RETAIL (DEPARTMENT STORES)--0.5%
Kohl's Corp. (b)........................... 4,780 345,056
-----------------------------------
RETAIL (DRUG STORES)--1.0%
Walgreen Co................................ 23,110 675,968
-----------------------------------
RETAIL (GENERAL MERCHANDISE)--3.5%
Dayton Hudson Corp......................... 9,060 665,344
Wal-Mart Stores, Inc....................... 23,680 1,636,880
-----------------------------------
2,302,224
-----------------------------------
RETAIL (SPECIALTY)--1.1%
Staples, Inc. (b).......................... 33,625 697,719
-----------------------------------
SERVICES (ADVERTISING/MARKETING)--1.3%
Interpublic Group of Companies, Inc.
(The).................................... 14,600 842,238
-----------------------------------
SERVICES (COMMERCIAL & CONSUMER)--1.6%
Cendant Corp. (b).......................... 39,520 1,049,750
-----------------------------------
SERVICES (COMPUTER SYSTEMS)--2.0%
Electronic Data Systems Corp............... 19,400 1,298,588
-----------------------------------
TELECOMMUNICATIONS (LONG DISTANCE)--4.5%
MCI WorldCom, Inc. (b)..................... 55,620 2,951,336
-----------------------------------
TOTAL COMMON STOCKS
(Identified cost $44,278,193)................................................... 59,608,819
-----------------------------------
FOREIGN COMMON STOCKS--0.4%
ENTERTAINMENT--0.4%
News Corporation Ltd. (The) Sponsored ADR
(Australia).............................. 7,900 302,176
-----------------------------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $314,983)...................................................... 302,176
-----------------------------------
TOTAL LONG-TERM INVESTMENTS--91.4%
(Identified cost $44,593,176)................................................... 59,910,995
-----------------------------------
</TABLE>
See Notes to Financial Statements
16
<PAGE>
PHOENIX-ENGEMANN NIFTY FIFTY SERIES
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- ------------- ---------------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--8.6%
COMMERCIAL PAPER--8.6%
Koch Industries, Inc. 7.50%, 1/3/00............. A-1+ $ 2,635 $ 2,633,902
Ford Motor Credit Co. 5.25%, 1/4/00............. A-1 1,000 999,562
SBC Communications, Inc. 5%, 1/10/00............ A-1+ 2,000 1,997,500
---------------
5,630,964
---------------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $5,630,964)................................................ 5,630,964
---------------
TOTAL INVESTMENTS--100.0%
(Identified cost $50,224,140)............................................... 65,541,959(a)
Cash and receivables, less liabilities--(0.0%).............................. (21,658)
---------------
NET ASSETS--100.0%............................................................ $ 65,520,301
===============
</TABLE>
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $16,182,049 and gross
depreciation of $1,246,558 for federal income tax purposes. At December 31,
1999, the aggregate cost of securities for federal income tax purpose was
$50,606,468.
(b) Non-income producing.
See Notes to Financial Statements
17
<PAGE>
PHOENIX-ENGEMANN NIFTY FIFTY SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$50,224,140).............................................. $65,541,959
Cash........................................................ 4,825
Receivables
Fund shares sold.......................................... 125,955
Dividends and interest.................................... 12,131
Prepaid expenses............................................ 177
-----------
Total assets............................................ 65,685,047
-----------
LIABILITIES
Payables
Fund shares repurchased................................... 68,416
Investment advisory fee................................... 27,325
Trustees' fee............................................. 6,958
Financial agent fee....................................... 8,514
Accrued expenses............................................ 53,533
-----------
Total liabilities....................................... 164,746
-----------
NET ASSETS.................................................. $65,520,301
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $51,277,893
Accumulated net realized loss............................. (1,075,411)
Net unrealized appreciation............................... 15,317,819
-----------
NET ASSETS.................................................. $65,520,301
===========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 3,928,413
===========
Net asset value and offering price per share................ $ 16.68
===========
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 148,259
Interest.................................................. 185,350
-----------
Total investment income................................. 333,609
-----------
EXPENSES
Investment advisory fee................................... 322,073
Financial agent fee....................................... 77,510
Custodian................................................. 44,570
Printing.................................................. 25,150
Professional.............................................. 18,616
Trustees.................................................. 16,302
Miscellaneous............................................. 8,846
-----------
Total expenses.......................................... 513,067
Less expense borne by investment adviser................ (137,315)
-----------
Net expenses............................................ 375,752
-----------
NET INVESTMENT LOSS......................................... (42,143)
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on securities........................... (831,282)
Net change in unrealized appreciation (depreciation) on
investments............................................. 13,019,938
-----------
NET GAIN ON INVESTMENTS..................................... 12,188,656
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $12,146,513
===========
</TABLE>
See Notes to Financial Statements
18
<PAGE>
PHOENIX-ENGEMANN NIFTY FIFTY SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM
YEAR INCEPTION
ENDED 3/2/98 TO
12/31/99 12/31/98
----------- -----------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ (42,143) $ 3,598
Net realized gain (loss).................................. (831,282) (244,129)
Net change in unrealized appreciation (depreciation)...... 13,019,938 2,297,881
----------- -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 12,146,513 2,057,350
----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... -- (3,598)
In excess of net investment income........................ -- (1,543)
----------- -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ -- (5,141)
----------- -----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (4,311,541 and 1,342,696
shares, respectively)................................... 60,115,343 14,285,565
Net asset value of shares issued from reinvestment of
distributions (0 and 406 shares, respectively).......... -- 5,141
Cost of shares repurchased (1,425,320 and 300,910 shares,
respectively)........................................... (19,895,037) (3,189,433)
----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 40,220,306 11,101,273
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 52,366,819 13,153,482
NET ASSETS
Beginning of period....................................... 13,153,482 --
----------- -----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $0 AND $0, RESPECTIVELY)............... $65,520,301 $13,153,482
=========== ===========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM
YEAR INCEPTION
ENDED 3/2/98 TO
12/31/99 12/31/98
-------- -----------
<S> <C> <C>
Net asset value, beginning of period........................ $ 12.62 $ 10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. -- 0.01(4)
Net realized and unrealized gain (loss)................... 4.06 2.62
-------- --------
TOTAL FROM INVESTMENT OPERATIONS........................ 4.06 2.63
-------- --------
LESS DISTRIBUTIONS
Dividends from net investment income...................... -- (0.01)
-------- --------
TOTAL DISTRIBUTIONS..................................... -- (0.01)
-------- --------
CHANGE IN NET ASSET VALUE................................... 4.06 2.62
-------- --------
NET ASSET VALUE, END OF PERIOD.............................. $ 16.68 $ 12.62
======== ========
Total return................................................ 32.15% 26.26%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $65,520 $13,153
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3)..................................... 1.05% 1.05%(1)
Net investment income..................................... (0.12)% 0.07%(1)
Portfolio turnover rate..................................... 40% 90%(2)
</TABLE>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 1.43% and
2.58% for the periods ended December 31, 1999 and 1998, respectively.
(4) Computed using average shares outstanding.
See Notes to Financial Statements
19
<PAGE>
PHOENIX-GOODWIN MONEY MARKET SERIES
INVESTOR PROFILE
The Fund is appropriate for conservative investors who want competitive
money market yields with minimal risk to principal. Investors should note that
an investment in this Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund seeks to
preserve the value of an investor's investment at $10.00 per share, it is
possible to lose money by investing in the Fund.
INVESTMENT ADVISOR'S REPORT
For the 12 months ended December 31, 1999, the Fund returned 4.82% compared
with a return of 4.76% for the Salomon Brothers 90-day T-bill(1). All
performance figures assume reinvestment of distributions and are net of sales
charges.
Financial market conditions appeared to show improved economic fundamentals.
The stabilization of global markets accompanied with persistent domestic
economic strength heightened concerns towards a greater risk of rising
inflation. On June 30, 1999 and again on August 24 and November 16, the Federal
Reserve raised rates, resulting in a total rate increase of 75 basis points for
the year. At the November 16, 1999 meeting, a neutral bias was adopted.
The Fund's weighted average maturity is currently 41 days. Potential Year
2000 disruptions caused an inflow of cash into the Fund at year-end. The
portfolio is continuously monitored and adjusted to current market conditions.
OUTLOOK
Strong domestic demand and recovering foreign economies will be the focus
going forward. We believe the market will continue to question the strength of
the economy and whether we will see any signs of rising inflation over the
months ahead. In the event we see ongoing signs of rising inflation, we believe
the Federal Reserve will raise rates once again.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
MONEY MARKET SERIES IBC MONEY MARKET INSIGHT*
<S> <C> <C>
1/31/99 4.75% 4.43%
2/28/99 4.68% 4.29%
3/31/99 4.47% 4.23%
4/30/99 4.37% 4.21%
5/31/99 4.34% 4.19%
6/30/99 4.45% 4.23%
7/31/99 4.58% 4.36%
8/31/99 4.66% 4.47%
9/30/99 4.85% 4.62%
10/31/99 4.94% 4.73%
11/30/99 5.05% 4.88%
12/31/99 5.47% 5.08%
</TABLE>
The above graph covers the period from January 1, 1999 to December 31, 1999. The
results are not indicative of the rate of return which may be realized from an
investment made in the Money Market Series today.
* Average monthly yield of First Tier Money Market Funds as reported by IBC's
Money Market Insight.
(1) Salomon Brothers 90-day T-bill is a commonly used measure of short-term
money market performance.
20
<PAGE>
PHOENIX-GOODWIN MONEY MARKET SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
FACE
VALUE INTEREST RESET
(000) DESCRIPTION RATE DATE VALUE
- ------- ---------------------------------------- -------- -------- ------------
<C> <S> <C> <C> <C>
FEDERAL AGENCY SECURITIES--VARIABLE(b)--16.1%
$ 2,500 FFCB (final maturity 6/1/00)............ 5.71% 1/1/00 $ 2,500,000
4,500 FFCB (final maturity 7/24/00)........... 5.79 1/24/00 4,500,000
2,500 FHLB (final maturity 2/25/00)........... 6.16 1/5/00 2,500,000
2,500 FHLB (final maturity 7/14/00)........... 5.71 7/14/00 2,494,749
6,600 FNMA (final maturity 2/24/00)........... 5.54 2/24/00 6,545,154
212 SBA (final maturity 1/25/21)............ 6.00 1/1/00 212,392
180 SBA (final maturity 5/25/21)............ 5.75 1/1/00 180,368
3,242 SBA (final maturity 11/25/21)........... 5.88 1/1/00 3,239,511
1,621 SBA (final maturity 10/25/22)........... 5.75 1/1/00 1,618,842
2,157 SBA (final maturity 2/25/23)............ 5.75 1/1/00 2,157,310
1,713 SBA (final maturity 2/25/23)............ 5.75 1/1/00 1,712,500
2,843 SBA (final maturity 9/25/23)............ 5.63 1/1/00 2,839,857
2,375 SBA (final maturity 3/25/24)............ 5.88 1/1/00 2,372,237
2,500 SLMA (final maturity 5/18/00)........... 6.06 1/4/00 2,500,000
2,500 SLMA (final maturity 1/20/00)........... 5.89 1/4/00 2,500,000
------------
TOTAL FEDERAL AGENCY SECURITIES--VARIABLE............................ 37,872,920
------------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
PAR & POOR'S
VALUE RATING MATURITY
(000) DESCRIPTION (UNAUDITED) DATE
------- ---------------------------------------- ----------- --------
<C> <S> <C> <C> <C> <C>
COMMERCIAL PAPER--65.6%
10,000 Koch Industries, Inc.................... A-1+ 7.50 1/3/00 9,995,833
2,500 Bavaria Universal Funding Corp.......... A-1 6.40 1/10/00 2,496,000
2,500 Preferred Receivables Funding Corp...... A-1 6.29 1/10/00 2,496,069
2,750 Marsh & USA, Inc........................ A-1+ 6.50 1/12/00 2,744,538
546 Coca-Cola Co............................ A-1 6.50 1/13/00 544,817
4,376 Greenwich Funding Corp.................. A-1+ 5.95 1/13/00 4,376,372
2,931 Albertson's, Inc........................ A-1 5.89 1/14/00 2,924,766
6,000 Cargill, Inc............................ A-1 6.95 1/14/00 5,984,942
3,000 Enterprise Funding Corp................. A-1+ 5.98 1/14/00 2,993,522
500 Ford Motor Credit Co.................... A-1 6.05 1/14/00 498,908
3,050 Private Export Funding Corp............. A-1+ 5.83 1/14/00 3,043,579
1,285 American Home Products Corp............. A-1 6.02 1/18/00 1,281,347
1,920 Merrill Lynch & Co...................... A-1+ 5.90 1/18/00 1,914,651
3,000 Preferred Receivables Funding Corp...... A-1 6.60 1/18/00 2,990,650
2,500 BellSouth Telecommunications, Inc....... A-1+ 6.25 1/19/00 2,492,187
772 Merrill Lynch & Co...................... A-1+ 5.80 1/20/00 769,637
3,500 Cargill, Inc............................ A-1 5.40 1/21/00 3,489,500
2,900 SBC Communications, Inc................. A-1+ 6.20 1/24/00 2,888,513
500 Preferred Receivables Funding Corp...... A-1 5.58 1/25/00 498,140
1,300 Albertson's, Inc........................ A-1 6.40 1/26/00 1,294,222
3,500 Merrill Lynch & Co., Inc................ A-1+ 5.60 1/26/00 3,486,389
1,958 Wisconsin Electric Power Co............. A-1+ 6.25 1/26/00 1,949,502
2,500 Gannett Co., Inc........................ A-1+ 5.95 1/27/00 2,489,257
1,000 Asset Securitization Cooperative........ A-1+ 7.00 1/28/00 994,750
3,255 Marsh & USA, Inc........................ A-1+ 5.53 1/28/00 3,241,500
500 American Home Products Corp............. A-1 5.90 1/31/00 497,542
3,000 General Electric Capital Corp........... A-1+ 4.94 2/4/00 2,986,003
2,500 Greenwich Funding Corp.................. A-1+ 6.05 2/4/00 2,485,715
2,500 Preferred Receivables Funding Corp...... A-1 5.88 2/4/00 2,486,117
4,000 Kimberly-Clark Corp..................... A-1+ 6.10 2/8/00 3,974,244
3,750 Schering Corp........................... A-1+ 6.05 2/8/00 3,727,083
5,000 Heinz (H.J) Co.......................... A-1 6.12 2/9/00 4,966,850
3,500 Wisconsin Electric Power Co............. A-1+ 6.25 2/10/00 3,475,694
1,885 Enterprise Funding Corp................. A-1+ 6.15 2/11/00 1,871,797
1,530 Lexington Parker Capital Co. LLC........ A-1 5.82 2/11/00 1,519,859
1,770 American Home Products Corp............. A-1 5.85 2/15/00 1,757,057
2,500 Enterprise Funding Corp................. A-1+ 5.88 2/15/00 2,481,625
2,500 Receivables Capital Corp................ A-1+ 5.88 2/15/00 2,481,625
3,500 Bavaria Universal Funding Corp. (d)..... A-1+ 6.55 2/16/00 3,500,000
1,000 General Electric Capital Corp........... A-1+ 6.20 2/16/00 992,078
3,600 Private Export Funding Corp............. A-1+ 6.05 2/16/00 3,572,170
2,500 Preferred Receivables Funding Corp...... A-1 6.03 2/17/00 2,480,319
2,000 Lexington Parker Capital Co. LLC........ A-1 5.85 2/18/00 1,984,400
2,500 AlliedSignal, Inc....................... A-1 5.92 2/22/00 2,478,622
</TABLE>
See Notes to Financial Statements
21
<PAGE>
PHOENIX-GOODWIN MONEY MARKET SERIES
<TABLE>
<CAPTION>
STANDARD
PAR & POOR'S
VALUE RATING INTEREST MATURITY
(000) DESCRIPTION (UNAUDITED) RATE DATE VALUE
------- ---------------------------------------- ----------- -------- -------- -----------
<C> <S> <C> <C> <C> <C>
COMMERCIAL PAPER--CONTINUED
$ 1,965 Merrill Lynch & Co...................... A-1+ 5.87% 2/22/00 $ 1,948,339
1,940 American Home Products Corp............. A-1 5.67 2/23/00 1,923,806
2,285 American Home Products Corp............. A-1 5.72 2/24/00 2,265,395
3,500 Lexington Parker Capital Co. LLC........ A-1 6.05 2/25/00 3,467,840
1,833 Procter & Gamble Co..................... A-1+ 5.85 2/29/00 1,815,426
1,020 Lexington Parker Capital Co. LLC........ A-1 5.98 3/3/00 1,009,495
2,500 Enterprise Funding Corp................. A-1+ 6.00 3/13/00 2,470,000
2,500 Goldman Sachs & Co...................... A-1+ 6.15 3/15/00 2,468,396
3,000 Lexington Parker Capital Co. LLC........ A-1 6.15 3/17/00 2,961,050
4,500 Private Export Funding Corp............. A-1+ 5.80 3/20/00 4,442,725
2,500 Bavaria Universal Funding Corp.......... A-1 5.81 3/27/00 2,465,301
2,500 Bavaria Universal Funding Corp.......... A-1 6.20 3/27/00 2,462,972
2,500 Beta Finance, Inc....................... A-1+ 5.77 3/27/00 2,465,540
2,500 General Electric Capital Corp........... A-1+ 5.87 3/31/00 2,463,314
2,500 Campbell Soup Co........................ A-1+ 4.85 4/13/00 2,465,309
-----------
TOTAL COMMERCIAL PAPER............................................................ 154,684,299
-----------
CERTIFICATES OF DEPOSIT(C)--8.5%
2,500 Canadian Imperial Holdings, Inc......... AA- 6.48 1/24/00 2,502,245
2,500 Deutsche Bank Financial, Inc............ AA 4.97 2/2/00 2,499,715
2,500 Canadian Imperial Holdings, Inc......... AA- 5.01 2/7/00 2,499,951
2,500 Deutsche Bank Financial, Inc............ AA 5.10 2/17/00 2,499,907
2,500 Canadian Imperial Holdings, Inc......... AA- 5.12 2/23/00 2,499,860
450 Canadian Imperial Holdings, Inc......... AA- 5.27 3/3/00 449,723
3,000 Deutsche Bank Financial, Inc............ AA 5.19 3/13/00 2,999,742
3,500 ABN AMRO Bank (d)....................... AA 5.63 4/20/00 3,499,380
550 Deutsche Bank Financial, Inc............ AA 5.25 5/18/00 549,038
-----------
TOTAL CERTIFICATES OF DEPOSIT..................................................... 19,999,561
-----------
MEDIUM-TERM NOTES--8.3%
Associates Corporation of North America
2,500 (d)..................................... AA- 6.34 3/20/00 2,499,627
2,500 Beta Finance, Inc....................... AAA 5.35 3/9/00 2,500,000
Associates Corporation of North
2,500 America................................. AA- 9.13 4/1/00 2,523,695
2,500 Dupont (E.I.) de Nemours & Co........... AA- 5.08 4/3/00 2,499,562
1,000 General Electric Capital Corp........... AAA 5.76 4/24/00 999,397
3,500 General Electric Capital Corp........... AAA 5.83 4/28/00 3,499,007
1,000 Beta Finance, Inc....................... AAA 5.27 5/15/00 996,407
Associates Corporation of North
1,577 America................................. AA- 6.31 6/16/00 1,578,677
2,500 Pitney Bowes. Inc....................... AA 5.95 9/29/00 2,500,000
-----------
TOTAL MEDIUM-TERM NOTES........................................................... 19,596,372
-----------
TOTAL INVESTMENTS--98.5%
(Identified cost $232,153,152).................................................. 232,153,152(a)
Cash and receivables, less liabilities--1.5%.................................... 3,430,860
-----------
NET ASSETS--100.0%................................................................ $235,584,012
===========
</TABLE>
(a) Federal Income Tax Information: At December 31, 1999, the aggregate cost of
securities was the same for book and tax purposes.
(b) Variable rate demand notes. The interest rates shown reflect the rates
currently in effect.
(c) The interest rate shown is the coupon rate.
(d) Variable or step coupon security. The interest rate shown reflects the rate
currently in effect.
See Notes to Financial Statements
22
<PAGE>
PHOENIX-GOODWIN MONEY MARKET SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$232,153,152)............................................. $232,153,152
Cash........................................................ 1,127
Receivables
Fund shares sold.......................................... 3,799,483
Interest.................................................. 1,543,903
Investment securities sold................................ 158,222
Prepaid expenses............................................ 2,903
------------
Total assets............................................ 237,658,790
------------
LIABILITIES
Payables
Fund shares repurchased................................... 1,872,110
Investment advisory fee................................... 95,288
Trustees' fee............................................. 6,958
Financial agent fee....................................... 19,803
Accrued expenses............................................ 80,619
------------
Total liabilities....................................... 2,074,778
------------
NET ASSETS.................................................. $235,584,012
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $235,584,012
------------
NET ASSETS.................................................. $235,584,012
============
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 23,558,424
============
Net asset value and offering price per share................ $ 10.00
============
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $10,968,861
-----------
Total investment income................................. 10,968,861
-----------
EXPENSES
Investment advisory fee................................... 830,480
Financial agent fee....................................... 213,819
Custodian................................................. 46,744
Printing.................................................. 34,247
Professional.............................................. 23,763
Trustees.................................................. 16,286
Miscellaneous............................................. 10,106
-----------
Total expenses.......................................... 1,175,445
Less expense borne by investment adviser................ (33,870)
-----------
Net expenses............................................ 1,141,575
-----------
NET INVESTMENT INCOME....................................... 9,827,286
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $ 9,827,286
===========
</TABLE>
See Notes to Financial Statements
23
<PAGE>
PHOENIX-GOODWIN MONEY MARKET SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
------------------- -------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 9,827,286 $ 7,055,194
------------ ------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 9,827,286 7,055,194
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (9,827,286) (7,055,197)
------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (9,827,286) (7,055,197)
------------ ------------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (48,073,554 and 47,209,211
shares, respectively)................................... 480,735,538 472,092,185
Net asset value of shares issued from reinvestment of
distributions
(982,729 and 705,519 shares, respectively).............. 9,827,286 7,055,197
Cost of shares repurchased (45,179,003 and 40,894,255
shares, respectively)................................... (451,790,033) (408,942,852)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 38,772,791 70,204,530
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS..................... 38,772,791 70,204,527
NET ASSETS
Beginning of period....................................... 196,811,221 126,606,694
------------ ------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $0 AND $0, RESPECTIVELY)............... $235,584,012 $196,811,221
============ ============
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1999 1998 1997 1996 1995
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period........................ $10.00 $10.00 $10.00 $10.00 $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.47 0.50 0.50 0.50 0.56
------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS........................ 0.47 0.50 0.50 0.50 0.56
------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.47) (0.50) (0.50) (0.50) (0.56)
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS..................................... (0.47) (0.50) (0.50) (0.50) (0.56)
------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD.............................. $10.00 $10.00 $10.00 $10.00 $10.00
====== ====== ====== ====== ======
Total return................................................ 4.82% 5.09% 4.99% 4.98% 5.55%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $235,584 $196,811 $126,607 $131,361 $102,943
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses (1).................................... 0.55% 0.55% 0.55% 0.55% 0.53%(2)
Net investment income..................................... 4.73% 4.99% 5.07% 4.89% 5.57%
</TABLE>
(1) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 0.57% for
the period ended December 31, 1999.
(2) The ratio of operating expenses to average net assets excludes the effect of
expense offsets for custodian fees; if expense offsets were included, the
ratio would not significantly differ.
See Notes to Financial Statements
24
<PAGE>
PHOENIX-GOODWIN MULTI-SECTOR FIXED INCOME SERIES
INVESTOR PROFILE
The Fund is appropriate for investors seeking high current income. Investors
should note that the Fund may hold foreign bonds, and foreign investments pose
additional risk, such as currency fluctuation, less public disclosure, and
political and economic uncertainty. The Fund may also invest in high-yielding
fixed-income securities that are generally subject to greater market
fluctuations and risk of loss of income and principal than are investments in
lower yielding fixed-income securities.
INVESTMENT ADVISOR'S REPORT
For the year ended December 31, 1999, the Fund returned 5.46% compared with
a return of (0.83)% for the Lehman Brothers Aggregate Bond Index*. All
performance figures assume reinvestment of distributions and are net of sales
charges.
The bond market is definitely not a repeat of last year. Last year we saw
Russia default, hedge funds unwind around the world, a global liquidity crisis
erupt, and a Fed response of lowering interest rates. Now we are experiencing a
record supply of issues in non-Treasury sectors, Y2K fears, a reduced role for
Wall Street as a market liquidity provider, and a Fed bias toward higher rates.
These were the concerns in the third quarter, but investors have come to realize
that these fears were overblown, and now we are seeing a reversal in yield
spreads.
The Fund performed very well during this period, with higher-yielding
sectors being among the best performers in the market. We have maintained our
strategy of investing in sectors with best relative values, and while this hurt
performance last year, this has benefited results this year. Some of the best
contributors to performance were our holdings in the cable and
telecommunications industries.
OUTLOOK
The U. S. economy remains surprisingly strong, and although inflation has
picked up momentum, it is still very low. Real yields remain attractive by
historical standards, and all spread sectors now offer exceptional value.
We will continue to follow our investment strategy of investing in the
sectors that offer the best relative value. This approach often leads us to
emphasize evolving sectors of the bond market where inefficiencies exist that we
believe can lead to significant upside potential. For example, euro high-yield
securities offer an excellent opportunity to take advantage of the
inefficiencies between foreign and domestic markets and participate in the
tremendous growth expected in this area. The corporate high-yield sector also
provides exceptional relative value compared with other alternatives, such
corporate bonds. Commercial mortgage-backed issues are another very attractive
undervalued sector of the market, given current low delinquency rates, excellent
fundamentals, strong technicals, and growing institutional demand.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
MULTI-SECTOR FIXED INCOME SERIES LEHMAN BROTHERS AGGREGATE BOND INDEX*
<S> <C> <C>
12/31/1989 $10,000.00 $10,000.00
12/31/1990 $10,525.03 $10,895.96
12/31/1991 $12,568.40 $12,639.62
12/31/1992 $13,828.98 $13,575.01
12/31/1993 $16,027.53 $14,898.67
12/31/1994 $15,150.26 $14,464.17
12/31/1995 $18,716.31 $17,136.97
12/31/1996 $21,040.58 $17,759.10
12/31/1997 $23,339.06 $19,473.34
12/31/1998 $22,401.73 $21,164.95
12/31/1999 $23,624.22 $20,990.33
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C> <C>
1 YEAR 5 YEARS 10 YEARS
- -------------------------------------------------------------------------------------------
Multi-Sector Fixed Income Series 5.46% 9.29% 8.98%
- -------------------------------------------------------------------------------------------
Lehman Brothers Aggregate Bond Index* (0.83)% 7.73% 7.70%
- -------------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 12/31/89.
Returns shown include the reinvestment of all distributions at net asset value,
and the change in share price for the stated period. Returns indicate past
performance, which is not predictive of future performance. Investment return
and net asset value will fluctuate so that your shares, when redeemed, may be
worth more or less than the original cost. 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 fluctuation and less
public disclosure, as well as economic and political risks.
* The Lehman Brothers Aggregate Bond Index is an unmanaged but commonly used
measure of bond performance. The Index is not available for direct investment.
25
<PAGE>
PHOENIX-GOODWIN MULTI-SECTOR FIXED INCOME SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
MOODY'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
U.S. GOVERNMENT SECURITIES--3.9%
U.S. TREASURY BONDS--2.8%
U.S. Treasury Bonds 6.125%,
8/15/29......................... Aaa $ 5,000 $ 4,763,925
------------
U.S. TREASURY NOTES--1.1%
U.S. Treasury Notes 6%, 8/15/09... Aaa 2,000 1,937,593
------------
TOTAL U.S. GOVERNMENT SECURITIES
(Identified cost $6,971,933).............................. 6,701,518
------------
AGENCY MORTGAGE-BACKED SECURITIES--5.4%
Fannie Mae 6.25%, 5/15/29......... Aaa 9,250 8,255,625
GNMA 6.50%, '23-'26............... Aaa 1,107 1,046,699
GNMA 8%, 9/15/06.................. Aaa 4 4,512
GNMA 8%, 10/15/06................. Aaa 106 108,561
------------
TOTAL AGENCY MORTGAGE-BACKED SECURITIES
(Identified cost $9,567,359).............................. 9,415,397
------------
AGENCY NON MORTGAGE-BACKED SECURITIES--7.9%
Fannie Mae 6.625%, 9/15/09........ Aaa 13,950 13,566,375
------------
TOTAL AGENCY NON MORTGAGE-BACKED SECURITIES
(Identified cost $13,913,667)............................. 13,566,375
------------
MUNICIPAL BONDS--12.2%
CALIFORNIA--2.8%
Alameda Corridor Transportation
Authority Revenue Taxable Series
C 6.50%, 10/1/19................ Aaa 750 643,125
Alameda Corridor Transportation
Authority Revenue Taxable Series
C 6.60%, 10/1/29................ Aaa 1,750 1,478,750
Orange County Pension Obligation
Revenue Taxable Series A 7.67%,
9/1/09.......................... Aaa 2,620 2,633,100
------------
4,754,975
------------
CONNECTICUT--1.7%
Mashantucket Western Pequot Tribe
Revenue Taxable Series A 144A
6.91%, 9/1/12 (b)............... Aaa 1,100 1,038,125
Mashantucket Western Pequot Tribe
Revenue Taxable Series A 144A
6.57%, 9/1/13 (b)............... Aaa 2,140 1,944,725
------------
2,982,850
------------
FLORIDA--2.0%
Palm Beach County Solid Waste
Industrial Development Project B
Revenue Taxable 10.50%, 1/1/11
(e)(f)(i)....................... NR 685 137,000
Tampa Solid Waste System Revenue
Taxable Series A 6.46%,
10/1/09......................... Aaa 2,250 2,044,687
University of Miami Exchangeable
Revenue Taxable Series A 7.65%,
4/1/20.......................... Aaa 1,310 1,229,762
------------
3,411,449
------------
ILLINOIS--2.3%
Illinois Educational Facilities
Authority-Loyola University
Revenue Taxable Series C 7.12%,
7/1/11.......................... Aaa 1,330 1,275,138
Illinois Educational Facilities
Authority-Loyola University
Revenue Series A 5.70%,
7/1/24.......................... Aaa 1,200 1,138,500
Illinois Educational Facilities
Authority-Loyola University
Revenue Taxable Series A 7.84%,
7/1/24.......................... Aaa 1,600 1,528,000
------------
3,941,638
------------
<CAPTION>
MOODY'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
MASSACHUSETTS--1.6%
Massachusetts Port Authority
Revenue Taxable Series C 6.35%,
7/1/06.......................... Aa $ 1,500 $ 1,411,875
Worcester Pension General
Obligation Taxable 6.25%,
1/1/28.......................... Aaa 1,750 1,432,813
------------
2,844,688
------------
PENNSYLVANIA--1.0%
Pittsburgh Pension General
Obligation Taxable Series B
6.35%, 3/1/13................... Aaa 2,000 1,765,000
------------
TEXAS--0.8%
Texas State University System
Revenue 6.16%, 3/15/06.......... Aaa 1,495 1,399,694
------------
TOTAL MUNICIPAL BONDS
(Identified cost $23,261,042)............................. 21,100,294
------------
ASSET-BACKED SECURITIES--6.6%
ContiMortgage Home Equity Loan
Trust 98-1, B 7.86%, 4/15/29.... Baa 4,000 3,613,125
Continental Airlines, Inc. Series
97-2D 7.522%, 6/30/01........... Ba 1,398 1,388,346
Green Tree Financial Corp. 94-1,
B2 7.85%, 4/15/19............... Baa 3,000 2,626,950
IMC Home Equity Loan Trust 98-1, B
7.87%, 6/20/29.................. Baa 2,000 1,788,750
LB Commercial Conduit Mortgage
Trust 99-C2, A2 7.325%,
9/15/09......................... Aaa 2,100 2,069,156
------------
TOTAL ASSET-BACKED SECURITIES
(Identified cost $12,640,811)............................. 11,486,327
------------
CORPORATE BONDS--16.0%
AIRLINES--0.8%
Continental Airlines, Inc. 7.461%,
4/1/15.......................... Aa 1,372 1,316,858
------------
AUTOMOBILES--1.4%
Titan Tire Corp. 7%, 2/11/00...... NR 2,500 2,487,500
------------
BANKS (MAJOR REGIONAL)--1.3%
BNP U.S. Funding LLC Series A
144A, 7.738%, 12/31/49 (b)(d)... A 2,500 2,315,152
------------
BROADCASTING (TELEVISION, RADIO & CABLE)--0.6%
EchoStar Communications Corp.
9.375%, 2/1/09.................. B 1,000 1,005,000
------------
COMMUNICATIONS EQUIPMENT--2.0%
Metromedia Fiber Network, Inc.
Series B 10%, 11/15/08.......... B 1,140 1,171,350
Williams Communications Group,
Inc. 10.875%, 10/1/09........... B 2,250 2,362,500
------------
3,533,850
------------
COMPUTERS (SOFTWARE & SERVICES)--0.9%
PSINet, Inc. 10.5%, 12/1/06....... B 1,500 1,529,610
------------
ENTERTAINMENT--1.1%
SFX Entertainment, Inc. 9.125%,
12/1/08......................... B 2,000 1,895,000
------------
HOMEBUILDING--1.0%
Lennar Corp. 7.625%, 3/1/09....... Ba 2,000 1,790,000
------------
LEISURE TIME (PRODUCTS)--0.7%
Bally Total Fitness Holding Corp.
Series D 9.875%, 10/15/07....... B 1,150 1,118,375
------------
OIL & GAS (EXPLORATION & PRODUCTION)--1.0%
Benton Oil & Gas Co. 9.375%,
11/1/07......................... B 1,500 975,000
</TABLE>
See Notes to Financial Statements
26
<PAGE>
PHOENIX-GOODWIN MULTI-SECTOR FIXED INCOME SERIES
<TABLE>
<CAPTION>
MOODY'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
OIL & GAS (EXPLORATION & PRODUCTION)--CONTINUED
Benton Oil & Gas Co. 11.625%,
5/1/03.......................... B $ 1,000 $ 730,000
------------
1,705,000
------------
PAPER & FOREST PRODUCTS--0.9%
S.D. Warren Co. PIK 14%,
12/15/06........................ NR 1,391 1,557,360
------------
SERVICES (COMMERCIAL & CONSUMER)--0.6%
ARA Services, Inc. 10.625%,
8/1/00.......................... Baa 27 27,810
Fisher Scientific International,
Inc. 9%, 2/1/08................. B 1,000 962,500
------------
990,310
------------
TELECOMMUNICATIONS (LONG DISTANCE)--1.9%
Interamericas Communications Corp.
14%, 10/27/07................... NR 2,050 2,275,500
Metromedia International Group,
Inc. 10.50%, 9/30/07............ NR 756 377,778
RCN Corp. Series B 0%, 2/15/08
(d)............................. B 1,000 660,000
------------
3,313,278
------------
TELEPHONE--0.4%
Pathnet, Inc. 12.25%, 4/15/08..... NR 1,175 754,938
------------
TEXTILES (APPAREL)--1.4%
Collins & Aikman Corp. 11.50%,
4/15/06......................... B 2,390 2,366,100
------------
TOTAL CORPORATE BONDS
(Identified cost $29,352,327)............................. 27,678,331
------------
NON-AGENCY MORTGAGE-BACKED SECURITIES--19.5%
CS First Boston Mortgage
Securities Corp. 97-SPCE C 144A
7.077%, 2/20/07 (b)............. A(c) 2,000 1,915,625
CS First Boston Mortgage
Securities Corp. 98-C2, E 7.13%,
1/15/12......................... Baa 1,750 1,452,500
CS First Boston Mortgage
Securities Corp. 97-1R, 1M4 144A
7.559%, 2/28/22 (b)............. Baa 2,179 2,004,784
Commercial Mortgage Asset Trust
99-C1 D 7.35%, 10/17/13......... Baa 500 428,906
DLJ Mortgage Acceptance Corp.
97-CF2, B2 144A 7.14%, 11/15/08
(b)............................. Baa 2,200 1,925,687
First Chicago/Lennar Trust
97-CHL1, D 144A 8.126%, 5/29/08
(b)............................. BB(c) 2,000 1,596,250
G.E. Capital Mortgage Services,
Inc. 96-8, 2A5 7.50%, 5/25/26... AAA(c) 1,176 1,144,707
IMPAC CMB Trust 98-2, M3 7.25%,
4/25/28......................... A(c) 607 591,860
Merrill Lynch Mortgage Investors,
Inc. 96-C2, C 6.96%, 11/21/28... A(c) 3,607 3,426,650
Morgan Stanley Capital I 98-WF2, C
6.77%, 6/15/08.................. A(c) 1,700 1,586,312
Mortgage Capital Funding, Inc.
98-MC2, B 6.549%, 5/18/08....... Aa 2,500 2,307,422
Norwest Asset Securities Corp.
99-5, B3 6.25%, 3/25/14......... BBB(c) 1,521 1,342,700
Norwest Asset Securities Corp.
99-10, B3 6.25%, 4/25/14........ BBB(c) 873 766,494
Norwest Asset Securities Corp.
97-7, B1 7%, 5/25/27............ A 1,945 1,819,106
Residential Asset Securitization
Trust 96-A4, A13 7.50%,
9/25/26......................... AAA(c) 1,000 968,297
Residential Funding Mortgage
Securities I 94-S7, M3 6.50%,
3/25/34......................... BBB(c) 3,938 3,468,216
Ryland Mortgage Securities Corp.
III 92-A, 1A 8.257%, 3/29/30.... A-(c) 483 481,331
SASCO Floating Rate Commercial
Mortgage 98-C3A, H 7.031%,
4/25/03......................... Ba 2,250 2,060,156
Securitized Asset Sales Inc. 95-6,
B3 7%, 12/25/10 (h)............. NR 1,186 1,090,635
Structured Asset Securites Corp.
95-C4, E 8.742%, 6/25/26 (d).... BB(c) 2,000 1,956,891
<CAPTION>
MOODY'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
NON-AGENCY MORTGAGE-BACKED SECURITIES--CONTINUED
Wilshire Funding Corp. 97-WFC1, M3
7.25%, 8/25/27.................. Baa $ 1,492 $ 1,287,887
------------
TOTAL NON-AGENCY MORTGAGE-BACKED SECURITIES
(Identified cost $35,351,679)............................. 33,622,416
------------
FOREIGN GOVERNMENT SECURITIES--14.1%
ARGENTINA--0.7%
Republic of Argentina RegS 11.75%,
2/12/07 (g)..................... B 1,350 1,242,174
------------
BULGARIA--0.8%
Republic of Bulgaria FLIRB Bearer
Series A 2.75%, 7/28/12 (d)..... B 2,000 1,445,000
------------
COLOMBIA--0.9%
Republic of Colombia 10.875%,
3/9/04.......................... Ba 1,500 1,541,250
------------
CROATIA--1.7%
Croatia Series A 6.50%, 7/31/10
(d)............................. Baa 1,500 1,282,500
Croatia Series B 6.50%, 7/31/06
(d)............................. Baa 1,731 1,596,738
------------
2,879,238
------------
MEXICO--3.7%
United Mexican States Global Bond
11.375%, 9/15/16................ Ba 500 567,500
United Mexican States Global Bond
11.50%, 5/15/26................. Ba 4,850 5,801,812
------------
6,369,312
------------
PERU--1.8%
Republic of Peru PDI 4.50%, 3/7/17
(d)............................. Ba(c) 4,500 3,116,250
------------
PHILIPPINES--1.4%
Republic of Philippines 9.875%,
1/15/19......................... Ba 2,375 2,354,219
------------
POLAND--2.5%
Poland Bearer PDI 6%, 10/27/14
(d)............................. Baa 4,900 4,348,750
------------
TURKEY--0.6%
Republic of Turkey 12.375%,
6/15/09......................... B 1,000 1,078,750
------------
TOTAL FOREIGN GOVERNMENT SECURITIES
(Identified cost $23,531,251)............................. 24,374,943
------------
FOREIGN CORPORATE BONDS--9.7%
ARGENTINA--1.0%
Compania de Radiocomunicaciones
Moviles SA 144A 9.25%, 5/8/08
(b)............................. Ba 2,000 1,740,000
------------
BRAZIL--0.7%
Globo Communicacoes e
Participacoes SA 144A 10.625%,
12/5/08 (b)..................... B 1,500 1,271,250
------------
CHILE--2.0%
Empresa Nacional de Electricidad
SA 7.75%, 7/15/08............... Baa 1,500 1,427,850
Empresa Nacional de Electricidad
SA 8.5%, 4/1/09................. Baa 2,000 1,982,500
------------
3,410,350
------------
MEXICO--1.6%
Alestra SA de Rl de CV 12.625%,
05/15/09........................ B 1,100 1,111,000
Nuevo Grupo Iusacell SA 144A
14.25%, 12/16/06................ B 750 781,875
Vicap SA 11.375%, 5/15/07 (Banks
(Money Center))................. Ba 1,000 927,500
------------
2,820,375
------------
NETHERLANDS--1.0%
PTC International Finance BV 0%,
7/1/07 (d)...................... B 2,500 1,662,500
------------
</TABLE>
See Notes to Financial Statements
27
<PAGE>
PHOENIX-GOODWIN MULTI-SECTOR FIXED INCOME SERIES
<TABLE>
<CAPTION>
MOODY'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
POLAND--0.6%
TPSA Finance BV 144A 7.75%,
12/10/08 (b).................... Baa $ 1,125 $ 1,049,062
------------
UNITED KINGDOM--1.5%
Orange PLC 8.75% 6/1/06........... NA 1,000 1,063,750
Royal & Sun Alliance 8.95%,
10/15/29........................ A 1,500 1,540,800
------------
2,604,550
------------
VENEZUELA--1.3%
PDVSA Finance Ltd. 7.50%,
11/15/28........................ A 3,250 2,279,063
------------
TOTAL FOREIGN CORPORATE BONDS
(Identified cost $17,631,048)............................. 16,837,150
------------
FOREIGN CONVERTIBLE BONDS--1.3%
RUSSIA--1.3%
Lukinter Finance Lukoil Cv. RegS
3.50%, 5/6/02................... CCC-(c) 2,700 2,254,500
------------
TOTAL FOREIGN CONVERTIBLE BONDS
(Identified cost $3,310,275).............................. 2,254,500
------------
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------------ ------------
<S> <C> <C> <C>
COMMON STOCKS--1.4%
TELECOMMUNICATIONS (LONG DISTANCE)--1.4%
FirstCom Corp............................ 64,050 $ 2,353,837
------------
TOTAL COMMON STOCKS
(Identified cost $281,820).............................. 2,353,837
------------
WARRANTS--0.0%
COMMUNICATIONS EQUIPMENT--0.0%
Loral Space & Communications, Inc.
Warrants (e)........................... 1,000 12,000
------------
FOREIGN GOVERNMENT--0.0%
Republic of Argentina Warrants (e)....... 1,440 3,060
------------
TELEPHONE--0.0%
Pathnet, Inc. 144A Warrants (b)(e)....... 1,000 10,000
------------
TOTAL WARRANTS
(Identified cost $0).................................... 25,060
------------
TOTAL INVESTMENTS--98.0%
(Identified cost $175,813,212).......................... 169,416,148(a)
Cash and receivables, less liabilities--2.0%............ 3,420,210
------------
NET ASSETS--100.0%........................................ $172,836,358
============
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized depreciation
of investment securities is comprised of gross appreciation
of $4,681,547 and gross depreciation of $11,220,117 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purposes
was $175,954,718.
(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 December 31, 1999, these securities
amounted to a value of $16,810,660 or 9.73% of net assets.
(c) As rated by Standard & Poor's, Fitch or Duff & Phelps.
(d) Variable or step coupon security; interest rate shown
reflects the rate currently in effect.
(e) Non-income producing.
(f) Security in default.
(g) Par value represents Argentine Pesos.
(h) Private placement.
(i) Security valued at fair value as determined in good faith by
or under the direction of the Trustees.
</TABLE>
See Notes to Financial Statements
28
<PAGE>
PHOENIX-GOODWIN MULTI-SECTOR FIXED INCOME SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$175,813,212)............................................. $169,416,148
Receivables
Interest and dividends.................................... 2,993,953
Fund shares sold.......................................... 875,732
Prepaid expenses............................................ 3,103
------------
Total assets............................................ 173,288,936
------------
LIABILITIES
Payables
Custodian................................................. 201,386
Fund shares repurchased................................... 42,285
Investment advisory fee................................... 63,697
Financial agent fee....................................... 17,612
Trustees' fee............................................. 6,958
Accrued expenses............................................ 120,640
------------
Total liabilities....................................... 452,578
------------
NET ASSETS.................................................. $172,836,358
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $195,635,395
Undistributed net investment income....................... 393,157
Accumulated net realized loss............................. (16,795,130)
Net unrealized depreciation............................... (6,397,064)
------------
NET ASSETS.................................................. $172,836,358
============
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 19,383,808
============
Net asset value and offering price per share................ $ 8.92
============
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $15,138,524
Dividends................................................. 92,628
-----------
Total investment income................................. 15,231,152
-----------
EXPENSES
Investment advisory fee................................... 902,144
Financial agent fee....................................... 195,800
Custodian................................................. 54,971
Printing.................................................. 53,036
Professional.............................................. 28,355
Trustees.................................................. 16,286
Miscellaneous............................................. 24,716
-----------
Total expenses.......................................... 1,275,308
Less expenses borne by investment adviser............... (102,581)
-----------
Net expenses............................................ 1,172,727
-----------
NET INVESTMENT INCOME....................................... 14,058,425
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on securities........................... (8,647,622)
Net change in unrealized appreciation (depreciation) on
investments............................................. 4,220,860
-----------
NET LOSS ON INVESTMENTS..................................... (4,426,762)
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $ 9,631,663
===========
</TABLE>
See Notes to Financial Statements
29
<PAGE>
PHOENIX-GOODWIN MULTI-SECTOR FIXED INCOME SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
------------ ------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 14,058,425 $ 15,128,640
Net realized gain (loss).................................. (8,647,622) (8,037,422)
Net change in unrealized appreciation (depreciation)...... 4,220,860 (15,423,527)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 9,631,663 (8,332,309)
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (14,551,396) (14,753,888)
Net realized gains........................................ -- (1,233,525)
------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (14,551,396) (15,987,413)
------------ ------------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (5,303,159 and 8,615,846
shares, respectively)................................... 48,313,453 85,699,046
Net asset value of shares issued from reinvestment of
distributions (1,621,827 and 1,648,116 shares,
respectively)........................................... 14,551,396 15,987,413
Cost of shares repurchased (7,942,462 and 8,318,291
shares, respectively)................................... (72,472,168) (81,629,911)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ (9,607,319) 20,056,548
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS..................... (14,527,052) (4,263,174)
NET ASSETS
Beginning of period....................................... 187,363,410 191,626,584
------------ ------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $393,157 AND $896,193, RESPECTIVELY)... $172,836,358 $187,363,410
============ ============
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1999 1998 1997 1996 1995
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period........................ $ 9.18 $10.38 $10.34 $10.22 $ 8.98
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.73 0.77 0.75 0.79 0.83(2)
Net realized and unrealized gain (loss)................... (0.24) (1.17) 0.34 0.43 1.22
------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS........................ 0.49 (0.40) 1.09 1.22 2.05
------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.75) (0.74) (0.77) (0.78) (0.81)
Dividends from net realized gains......................... -- (0.06) (0.28) (0.32) --
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS..................................... (0.75) (0.80) (1.05) (1.10) (0.81)
------ ------ ------ ------ ------
CHANGE IN NET ASSET VALUE................................... (0.26) (1.20) 0.04 0.12 1.24
------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD.............................. $ 8.92 $ 9.18 $10.38 $10.34 $10.22
====== ====== ====== ====== ======
Total return................................................ 5.46% (4.02)% 10.93% 12.42% 23.54%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $172,836 $187,363 $191,627 $145,044 $109,046
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses (1).................................... 0.65% 0.64% 0.65% 0.65% 0.65%(3)
Net investment income..................................... 7.79% 7.61% 7.25% 7.80% 8.55%
Portfolio turnover rate..................................... 125% 160% 151% 191% 147%
</TABLE>
(1) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 0.71%,
0.66%, 0.67% and 0.67% for the periods ended December 31, 1999, 1997, 1996
and 1995, respectively.
(2) Computed using average shares outstanding.
(3) The ratio of operating expenses to average net assets excludes the effect of
expense offsets for custodian fees: if expense offsets were included, the
ratio would not significantly differ.
See Notes to Financial Statements
30
<PAGE>
PHOENIX-HOLLISTER VALUE EQUITY SERIES
INVESTOR PROFILE
Phoenix-Hollister Value Equity Series is appropriate for investors seeking
long-term capital appreciation.
INVESTMENT ADVISOR'S REPORT
For the 12 months ended December 31, 1999, the Fund returned 24.33% compared
with 21.14% for the S&P 500 Index(1) and 12.73% for the S&P/BARRA Value
Index(3). All performance figures assume reinvestment of distributions and are
net of sales charges.
In 1999, the equity financial markets seemed to be driven not by the
expected factors, such as interest rates and inflation, as much as by
consolidations and growth possibilities. The average large-cap value mutual fund
in a universe of 279 similar funds was up 11.23% for the year, while the average
large-cap growth fund in a universe of 364 funds was up a spectacular 38.09%,
according to Lipper Inc. It seems as though the growth years of 1997, 1998, and
1999 were just one long year replayed over and over and over. As value
investors, we were very pleased with our performance as the Russell Value
1000(2) was up a paltry 7.35%.
We attribute the majority of the portfolio's strong performance to solid
stock picking. As the indices will attest, the market for under-loved,
under-followed, and under-appreciated stocks was sad as investors flocked to
growth names once again. We do, however, still hold true to the time-tested
thesis of "regression to the mean." Meaning, we believe value investing will
return with a vengeance.
OUTLOOK
We believe the new millennium will bring companies with solid long-term
prospects to the forefront as investors finally throw out those with just a
business plan. We will be focusing on companies such as Dycom and Mastech, which
will benefit greatly from the cable/telecommunications upgrade cycle, yet trade
at fractions of their future growth rates. A second example is Watson
Pharmaceuticals, a misunderstood branded drug company growing at 30-35% per
year, that is stuck in the valuation range of a generic company. The year 2000
should bring even more value ideas to the investment community as money managers
begin to re-evaluate fundamentals. We see this coming year as a value-type year
and our classic value approach is well situated to take advantage of a valuation
shakeup.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
VALUE EQUITY SERIES S&P 500 INDEX(1)
<S> <C> <C>
3/2/98 $10,000.00 $10,000.00
12/31/98 $11,079.20 $11,895.30
12/31/99 $13,774.77 $14,409.38
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C>
FROM
INCEPTION
3/2/98
1 YEAR TO 12/31/99
- ----------------------------------------------------------------------------------------
Value Equity Series 24.33% 19.09%
- ----------------------------------------------------------------------------------------
S&P 500 Index(1) 21.14% 22.06%
- ----------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 3/2/98.
Returns shown include the reinvestment of all distributions at net asset value,
and the change in share price for the stated period. Returns indicate past
performance, which is not predictive of future performance. Investment return
and net asset value will fluctuate so that your shares, when redeemed, may be
worth more or less than the original cost. Foreign investing involves special
risks such as currency fluctuation and less public disclosure, as well as
economic and political risks.
(1) The S&P 500 Index is an unmanaged, commonly used measure of stock market
total return performance. The Index is not available for direct investment.
(2) The Russell 1000 Index is an unmanaged, commonly used measure of performance
of small stocks. The Index is not available for direct investment.
(3) The S&P/BARRA Value Index is an unmanaged, commonly used measure of
large-cap, value-oriented stocks. The Index is not available for direct
investment.
31
<PAGE>
PHOENIX-HOLLISTER VALUE EQUITY SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
-------- -----------
<S> <C> <C> <C>
COMMON STOCKS--87.1%
AEROSPACE/DEFENSE--0.9%
General Dynamics Corp.............................. 3,000 $ 158,250
-----------
AUTO PARTS & EQUIPMENT--0.7%
Delphi Automotive Systems Corp..................... 8,000 126,000
-----------
BANKS (MAJOR REGIONAL)--0.7%
Bank One Corp...................................... 4,000 128,250
-----------
BANKS (MONEY CENTER)--5.5%
Bank of America Corp............................... 4,000 200,750
Chase Manhattan Corp. (The)........................ 6,500 504,969
Morgan (J.P.) & Co., Inc........................... 2,000 253,250
-----------
958,969
-----------
BEVERAGES (ALCOHOLIC)--0.8%
Anheuser-Busch Cos., Inc........................... 2,000 141,750
-----------
BROADCASTING (TELEVISION, RADIO & CABLE)--0.9%
MediaOne Group, Inc. (b)........................... 2,000 153,625
-----------
COMMUNICATIONS EQUIPMENT--6.8%
C-Cube Microsystems, Inc. (b)...................... 13,000 809,250
L-3 Communications Holdings, Inc. (b).............. 9,000 374,625
-----------
1,183,875
-----------
COMPUTERS (HARDWARE)--5.3%
Computer Network Technology Corp. (b).............. 27,000 619,312
Gadzoox Networks, Inc. (b)......................... 7,000 304,937
-----------
924,249
-----------
COMPUTERS (SOFTWARE & SERVICES)--4.3%
Healtheon/WebMD Corp. (b).......................... 13,000 487,500
Synopsys, Inc. (b)................................. 4,000 267,000
-----------
754,500
-----------
ELECTRICAL EQUIPMENT--7.9%
Amphenol Corp. Class A (b)......................... 6,000 399,375
Black Box Corp. (b)................................ 7,000 469,000
Plexus Corp. (b)................................... 4,600 202,400
Solectron Corp. (b)................................ 3,200 304,400
-----------
1,375,175
-----------
ELECTRONICS (COMPONENT DISTRIBUTORS)--4.2%
Network Access Solutions Corp. (b)................. 22,000 726,000
-----------
ELECTRONICS (SEMICONDUCTORS)--2.7%
Dallas Semiconductor Corp.......................... 4,000 257,750
Intel Corp......................................... 2,700 222,244
-----------
479,994
-----------
ENGINEERING & CONSTRUCTION--6.7%
Dycom Industries, Inc. (b)......................... 14,000 616,875
MasTec, Inc. (b)................................... 12,500 556,250
-----------
1,173,125
-----------
ENTERTAINMENT--0.8%
Walt Disney Co. (The).............................. 5,000 146,250
-----------
FINANCIAL (DIVERSIFIED)--5.8%
Citigroup, Inc..................................... 9,000 500,062
Fannie Mae......................................... 2,000 124,875
SLM Holding Corp................................... 9,000 380,250
-----------
1,005,187
-----------
<CAPTION>
SHARES VALUE
-------- -----------
<S> <C> <C> <C>
HEALTH CARE (GENERIC AND OTHER)--0.8%
Watson Pharmaceuticals, Inc. (b)................... 4,000 $ 143,250
-----------
INSURANCE (MULTI-LINE)--5.1%
American International Group, Inc.................. 5,000 540,625
CIGNA Corp......................................... 2,500 201,406
Hartford Financial Services Group, Inc. (The)...... 3,000 142,125
-----------
884,156
-----------
INVESTMENT BANKING/BROKERAGE--2.2%
Goldman Sachs Group, Inc. (The).................... 4,000 376,750
-----------
MACHINERY (DIVERSIFIED)--0.9%
Caterpillar, Inc................................... 3,500 164,719
-----------
MANUFACTURING (DIVERSIFIED)--12.2%
Corning, Inc....................................... 6,500 838,094
Eaton Corp......................................... 2,200 159,775
Honeywell International, Inc....................... 7,500 432,656
Illinois Tool Works, Inc........................... 2,500 168,906
Tyco International Ltd............................. 13,750 534,531
-----------
2,133,962
-----------
MANUFACTURING (SPECIALIZED)--0.9%
Diebold, Inc....................................... 7,000 164,500
-----------
OFFICE EQUIPMENT & SUPPLIES--1.7%
Pitney Bowes, Inc.................................. 6,000 289,875
-----------
REITS--0.6%
LaSalle Hotel Properties........................... 9,000 105,188
-----------
RETAIL (SPECIALTY)--0.4%
Claire's Stores, Inc............................... 3,000 67,125
-----------
RETAIL (SPECIALTY-APPAREL)--0.9%
Talbots, Inc. (The)................................ 3,500 156,188
-----------
SERVICES (COMMERCIAL & CONSUMER)--3.6%
Crown Castle International Corp. (b)............... 13,000 417,625
Rambus, Inc. (b)................................... 3,000 202,313
-----------
619,938
-----------
TELECOMMUNICATIONS (LONG DISTANCE)--2.0%
AT&T Corp.......................................... 7,000 355,250
-----------
TELEPHONE--1.8%
GTE Corp........................................... 2,500 176,406
SBC Communications, Inc............................ 3,000 146,250
-----------
322,656
-----------
TOTAL COMMON STOCKS
(Identified cost $13,301,232)................................ 15,218,756
-----------
FOREIGN COMMON STOCKS--7.5%
COMMUNICATIONS EQUIPMENT--4.8%
Alcatel SA ADR (France)............................ 11,500 517,500
Telefonaktiebolaget LM Ericsson Sponsored ADR
(Sweden)......................................... 5,000 328,437
-----------
845,937
-----------
COMPUTERS (SOFTWARE & SERVICES)--2.7%
SAP AG Sponsored ADR (Germany) (b)................. 9,000 468,563
-----------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $915,717)................................... 1,314,500
-----------
</TABLE>
See Notes to Financial Statements
32
<PAGE>
PHOENIX-HOLLISTER VALUE EQUITY SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- -----------
UNIT INVESTMENT TRUSTS--1.5%
<S> <C> <C> <C>
Diamonds Trust, Series I........................... 1,000 $ 115,188
S&P 500 Depository Receipts........................ 1,000 146,875
-----------
262,063
-----------
TOTAL UNIT INVESTMENT TRUSTS
(Identified cost $234,449)................................... 262,063
-----------
TOTAL LONG-TERM INVESTMENTS--96.1%
(Identified cost $14,451,398)................................ 16,795,319
-----------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000)
----------- --------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--4.4%
COMMERCIAL PAPER--4.4%
Koch Industries, Inc. 7.50%, 1/3/00... A-1+ $765 764,681
-----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $764,681)................................... 764,681
-----------
TOTAL INVESTMENTS--100.5%
(Identified cost $15,216,079)................................ 17,560,000(a)
Cash and receivables, less liabilities--(0.5%)............... (89,933)
-----------
NET ASSETS--100.0%............................................. $17,470,067
===========
</TABLE>
(a) Federal Income Tax Information; Net unrealized appreciation of investment
securities is comprised of gross appreciation of $3,168,048 and gross
depreciation of $835,653 for federal income tax purposes. At December 31,
1999, the aggregate cost of securities for federal income tax purposes was
$15,227,605.
(b) Non-income producing.
See Notes to Financial Statements
33
<PAGE>
PHOENIX-HOLLISTER VALUE EQUITY SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$15,216,079).............................................. $17,560,000
Cash........................................................ 3,033
Receivables
Funds shares sold......................................... 107,599
Dividends and interest.................................... 13,528
Receivable from adviser................................... 6,791
Prepaid expenses............................................ 134
-----------
Total assets............................................ 17,691,085
-----------
LIABILITIES
Payables
Investment securities purchased........................... 163,989
Fund shares repurchased................................... 869
Trustees' fee............................................. 6,958
Financial agent fee....................................... 5,736
Accrued expenses............................................ 43,466
-----------
Total liabilities....................................... 221,018
-----------
NET ASSETS.................................................. $17,470,067
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $14,248,119
Undistributed net investment income....................... 744
Accumulated net realized gain............................. 877,283
Net unrealized appreciation............................... 2,343,921
-----------
NET ASSETS.................................................. $17,470,067
===========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 1,352,895
===========
Net asset value and offering price per share................ $ 12.91
===========
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 123,302
Interest.................................................. 16,431
Foreign taxes withheld.................................... (863)
----------
Total investment income................................. 138,870
----------
EXPENSES
Investment advisory fee................................... 76,847
Financial agent fee....................................... 57,211
Printing.................................................. 31,771
Professional.............................................. 21,347
Custodian................................................. 16,813
Trustees.................................................. 16,346
Miscellaneous............................................. 2,692
----------
Total expenses.......................................... 223,027
Less expense borne by investment adviser................ (129,713)
----------
Net expenses............................................ 93,314
----------
NET INVESTMENT INCOME....................................... 45,556
----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 1,944,026
Net change in unrealized appreciation (depreciation) on
investments............................................. 1,347,332
----------
NET GAIN ON INVESTMENTS..................................... 3,291,358
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $3,336,914
==========
</TABLE>
See Notes to Financial Statements
34
<PAGE>
PHOENIX-HOLLISTER VALUE EQUITY SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
YEAR ENDED 3/2/98 TO
12/3199 12/31/98
------------------- -------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 45,556 $ 37,497
Net realized gain (loss).................................. 1,944,026 (110,638)
Net change in unrealized appreciation (depreciation)...... 1,347,332 996,589
----------- -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 3,336,914 923,448
----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (44,812) (37,497)
Net realized gains........................................ (956,105) --
In excess of net investment income........................ -- (388)
----------- -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (1,000,917) (37,885)
----------- -----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (1,031,543 and 990,498
shares, respectively)................................... 11,699,950 9,960,882
Net asset value of shares issued from reinvestment of
distributions (78,326 and 3,586 shares, respectively)... 1,000,917 37,885
Cost of shares repurchased (621,196 and 129,862 shares,
respectively)........................................... (7,099,784) (1,351,343)
----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 5,601,083 8,647,424
----------- -----------
NET INCREASE IN NET ASSETS................................ 7,937,080 9,532,987
NET ASSETS
Beginning of period....................................... 9,532,987 --
----------- -----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $744 AND DISTRIBUTIONS IN EXCESS OF NET
INVESTMENT INCOME OF ($388), RESPECTIVELY).............. $17,470,067 $ 9,532,987
=========== ===========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR FROM INCEPTION
ENDED 3/2/98 TO
12/31/99 12/31/98
--------- ----------------
<S> <C> <C>
Net asset value, beginning of period........................ $11.03 $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.04 0.05
Net realized and unrealized gain (loss)................... 2.63 1.03
------ ------
TOTAL FROM INVESTMENT OPERATIONS........................ 2.67 1.08
------ ------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.04) (0.05)
Dividends from net realized gains......................... (0.75) --
------ ------
TOTAL DISTRIBUTIONS..................................... (0.79) (0.05)
------ ------
CHANGE IN NET ASSET VALUE................................... 1.88 1.03
------ ------
NET ASSET VALUE, END OF PERIOD.............................. $12.91 $11.03
====== ======
Total return................................................ 24.33% 10.79%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $17,470 $9,533
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses (3).................................... 0.85% 0.85%(1)
Net investment income..................................... 0.41% 0.85%(1)
Portfolio turnover rate..................................... 168% 77%(2)
</TABLE>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 2.03% and
2.46% for the periods ended December 31, 1999 and 1998, respectively.
See Notes to Financial Statements
35
<PAGE>
PHOENIX-OAKHURST BALANCED SERIES
INVESTOR PROFILE
The Fund is appropriate for investors seeking long-term capital appreciation
through investments in a combination of stocks and fixed-income securities,
including foreign and high-yield debt issues. Investors should note that the
Fund may hold foreign bonds, and foreign investments pose additional risk, such
as currency fluctuation, less public disclosure, and political and economic
uncertainty.
INVESTMENT ADVISOR'S REPORT
For the 12 months ended December 31, 1999, the Fund returned 11.57% compared
with a return of 11.55% for a composite benchmark index comprised of 55% of the
return of the S&P 500 Index(1), 35% of the return for the Lehman Brothers
Aggregate Index(2), and 10% of the return for the Salomon Brothers 90-day
T-bill(3). The Fund's return outperformed Lipper Inc.'s flexible portfolio
mutual fund index return of 9.80%, according to Lipper, Inc. All performance
figures assume reinvestment of dividends and exclude the effect of sales
charges.
Technology and basic material stocks led market performance during the past
year. Technology issues were propelled by strength in the semiconductor industry
as demand finally caught up with supply due to a dramatic cutback of capacity
spending during 1998. The build-out of Internet infrastructure accelerated the
growth rate of many vendors of communication chips, networking equipment, and
computer servers. With the increasing number of corporations and consumers
populating the World Wide Web, a new class of software tools also emerged. Web
authoring, web-content management, and enterprise procurement management are
just a few of the examples. All of these contributed to the great technology
rally of 1999.
The surge in basic material stocks started earlier in 1999. As the Asian
economic crisis abated, there was great optimism that demand for basic
commodities would stabilize. The OPEC meeting in February rallied the price of
crude oil. The numerous unplanned outages at various chemical plants caused
commodity chemical price to increase. The protectionism measures contemplated by
Congress curbed steel imports. The strength in the domestic housing market made
forest products scarce. These factors led to increasing earnings forecasts for
many paper, chemical, steel and oil companies. From January through May, basic
material stocks dramatically outperformed the S&P 500 Index.
On the negative side, consumer non-cyclical and health-care stocks
underperformed the market all year. Consumer stocks were hampered by earnings
disappointments from market leaders Coke and Gillette. Many food producers also
failed to meet growth expectations. The drug stocks were slowed by lingering
talk of a Medicare-sponsored prescription benefit plan that may lower the
overall cost of medicine. In addition, major pharmaceutical companies must also
deal with the soon-to-come patent expiration of many blockbuster drugs.
The equity portion of the Fund held a great deal of media stocks. Issues
such as Clear Channel Communication, CBS, AMFM Inc, Liberty Media and Hughes
Electronics all had significantly above-market returns and contributed greatly
to portfolio performance. In the new age of digital media, these companies
either control great distribution or possess great content and have seen their
value rise greatly. The Fund also was helped by holdings in Microsoft, IBM,
America Online, Cisco, Sun Microsystems and Tellabs. These technology companies
are deriving great benefit from the increasing popularity of the Internet.
The Fund was also favorably exposed to several leading specialty retail
stocks, including Home Depot, Wal-mart Stores and Tandy. Home Depot and Wal-mart
have increased their dominance in the retail sector, exerting greater influence
on their suppliers and reaping significant benefit from the record high consumer
confidence. Tandy, through the ownership of RadioShack, served as an outlet for
wireless subscription plans, earning great profit in the process. Selected
financial service stocks also performed well. The portfolio held large positions
in Morgan Stanley, Citigroup, and American International Group, which all
appreciated greatly during the year.
At the time of this writing, the bond market is definitely not a repeat of
last year. We saw Russia default, hedge funds unwind around the world, a global
liquidity crisis erupt, and a Fed response of lowering interest rates. Now we
are experiencing a record supply of issues in non-Treasury sectors, Y2K fears, a
reduced role for Wall Street as a market liquidity provider, and a Fed bias
toward higher rates.
The bond portion of the Fund also performed well in this environment, with
higher-yielding sectors being among the best performers in the market. We have
maintained our strategy of investing in sectors with best relative values, and
while this hurt performance last year, this has benefited results this year.
Some of the best contributors to performance were our holdings in the cable and
telecommunications industries.
(1) The S&P 500 Index is an unmanaged, commonly used measure of stock market
total return performance.
(2) The Lehman Brothers Aggregate Index is an unmanaged, commonly used measure
of broad bond market total return performance. The indices are not available
for direct investment.
(3) The Salomon Brothers 90-day T-bill is a commonly used measure of short-term
debt total return performance.
36
<PAGE>
PHOENIX-OAKHURST BALANCED SERIES
OUTLOOK
The outlook for corporate profit has never been better. The global economic
recovery has brightened the earnings picture of many cyclical industries
including energy, paper, aluminum and chemical. With consumers' rapid acceptance
of the Internet, the build out of broadband and wireless infrastructure has been
accelerated. This should ensure another year of buoyant profit for leading
networking and computer companies. Global semiconductor industry is also in the
early stage of a multiyear up cycle. Demand for leading edge process exceeds
available supply. With both margin and pricing strong, the semiconductor
industry should post strong profitability.
A strong global economy naturally brings fear of inflationary pressure. It
is now the consensus view that the Federal Reserve will be raising interest rate
during 2000. Given already high equity valuation today, rising interest rate
will limit further multiple expansion. However, a strong profit outlook should
also mitigate any downside to equity price.
We also believe the outlook for the fixed-income markets is very favorable
for the long term. Real yields remain attractive by historical standards, and
all spread sectors now offer excellent value relative to long-term averages. Our
current focus is on Europe to take advantage of inefficiencies we are finding
there and using currency hedges to pick up incremental yield.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
BALANCED SERIES BALANCED BENCHMARK*
<S> <C> <C>
5/1/92 $10,000.00 $10,000.00
12/31/92 $10,971.74 $10,712.00
12/31/93 $11,912.39 $11,702.48
12/31/94 $11,578.93 $11,724.94
12/31/95 $14,274.19 $14,917.45
12/31/96 $15,781.82 $17,055.78
12/31/97 $18,611.70 $20,799.83
12/31/98 $22,150.51 $24,890.59
12/31/99 $24,714.19 $27,765.93
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C> <C>
FROM
INCEPTION
5/1/92 TO
1 YEAR 5 YEARS 12/31/99
- -------------------------------------------------------------------------------------------
Balanced Series 11.57% 16.37% 12.52%
- -------------------------------------------------------------------------------------------
Balanced Benchmark* 11.55% 18.82% 14.23%
- -------------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 5/1/92
(inception of the Fund). Returns shown include the reinvestment of all
distributions at net asset value, and the change in share price for the stated
period. Returns indicate past performance, which is not predictive of future
performance. Investment return and net asset value will fluctuate so that your
shares, when redeemed, may be worth more or less than the original cost. Foreign
investing involves special risks such as currency fluctuation and less public
disclosure, as well as economic and political risks.
* The Balanced Benchmark is calculated based upon the performance of the
followig indices: 55% S&P 500/35% Lehman Brothers Aggregate Bond Index/10%
90-day Treasury Bills and is produced by Frank Russell Company. The index is
not available for direct investment.
37
<PAGE>
PHOENIX-OAKHURST BALANCED SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
U.S. GOVERNMENT SECURITIES--5.8%
U.S. TREASURY BONDS--0.4%
U.S. Treasury Bonds 5.25%,
11/15/28........................... AAA $1,220 $ 1,005,179
U.S. Treasury Bonds 5.25%, 2/15/29... AAA 95 78,646
------------
1,083,825
------------
U.S. TREASURY NOTES--5.4%
U.S. Treasury Notes 5.375%,
1/31/00............................ AAA 1,075 1,075,321
U.S. Treasury Notes 5.50%, 3/31/00... AAA 750 750,203
U.S. Treasury Notes 6.875%,
3/31/00............................ AAA 3,100 3,110,971
U.S. Treasury Notes 6%, 8/15/00...... AAA 1,700 1,701,086
U.S. Treasury Notes 4.50%, 9/30/00... AAA 355 351,019
U.S. Treasury Notes 4.625%,
11/30/00........................... AAA 500 493,603
U.S. Treasury Notes 5.25%, 8/15/03... AAA 605 583,181
U.S. Treasury Notes 4.75%, 2/15/04... AAA 1,800 1,696,500
U.S. Treasury Notes 5.25%, 5/15/04... AAA 2,800 2,681,144
U.S. Treasury Notes 6%, 8/15/04...... AAA 200 196,781
U.S. Treasury Notes 5.875%,
11/15/04........................... AAA 400 392,028
U.S. Treasury Notes 5.625%,
5/15/08............................ AAA 234 220,060
U.S. Treasury Notes 6%, 8/15/09...... AAA 2,745 2,659,346
------------
15,911,243
------------
TOTAL U.S. GOVERNMENT SECURITIES
(Identified cost $17,578,852)................................ 16,995,068
------------
AGENCY MORTGAGE-BACKED SECURITIES--3.8%
Freddie Mac 6.625%, 9/15/09.......... AAA 4,000 3,885,000
GNMA 6.50%, 11/15/23................. AAA 1,370 1,298,555
GNMA 6.50%, 12/15/23................. AAA 458 433,884
GNMA 6.50%, 2/15/24.................. AAA 2,062 1,952,994
GNMA 6.50%, 6/15/28.................. AAA 3,675 3,449,536
------------
TOTAL AGENCY MORTGAGE-BACKED SECURITIES
(Identified cost $11,465,636)................................ 11,019,969
------------
AGENCY NON MORTGAGE-BACKED SECURITIES--3.2%
Fannie Mae 6.50%, 8/15/04............ AAA 449 443,521
Fannie Mae 6.625%, 9/15/09........... AAA(d) 9,355 9,097,737
------------
TOTAL AGENCY NON MORTGAGE-BACKED SECURITIES
(Identified cost $9,790,645)................................. 9,541,258
------------
MUNICIPAL BONDS--6.4%
CALIFORNIA--2.4%
Alameda Corridor Transportation
Authority Revenue Taxable Series C
6.60%, 10/1/29..................... AAA 1,000 845,000
Fresno County Pension Obligation
Revenue Taxable 6.21%, 8/15/06..... AAA 1,000 936,250
Fresno Pension Obligation Taxable
7.80%, 6/1/14...................... AAA 1,000 997,500
Kern County Pension Obligation
Revenue Taxable 7.26%, 8/15/14..... AAA 420 399,000
Long Beach Pension Obligation Taxable
6.87%, 9/1/06...................... AAA 230 223,100
Los Angeles County Metropolitan
Transportation Authority Revenue
Series C 5%, 7/1/23................ AAA 800 693,000
Orange County Pension Obligation
Revenue Taxable Series A 7.62%,
9/1/08............................. AAA 650 653,250
Pasadena Pension Funding Revenue
Taxable Series A 7.10%, 5/15/10.... AAA 1,205 1,159,812
San Bernardino County Pension
Obligation Revenue Taxable 6.87%,
8/1/08............................. AAA 110 105,462
San Bernardino County Pension
Obligation Revenue Taxable 6.94%,
8/1/09............................. AAA 300 286,875
Sonoma County Pension Obligation
Revenue Taxable 6.625%, 6/1/13..... AAA 495 447,356
Ventura County Pension Obligation
Taxable 6.54%, 11/1/05............. AAA 260 249,925
------------
6,996,530
------------
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
FLORIDA--0.6%
Miami Beach Special Obligation
Revenue Taxable 8.60%, 9/1/21...... AAA $ 875 $ 916,562
Tampa Solid Waste System Revenue
Taxable Series A 6.33%, 10/1/06.... AAA(d) 700 651,000
University of Miami Exchangeable
Revenue Taxable Series A 7.65%,
4/1/20 (e)......................... AAA 270 253,463
------------
1,821,025
------------
ILLINOIS--0.5%
Illinois Educational Facilities
Authority-Loyola University Revenue
Taxable Series A 7.84%, 7/1/24..... AAA 1,500 1,432,500
------------
MASSACHUSETTS--0.4%
Massachusetts State Port Authority
Revenue Taxable Series C 6.05%,
7/1/02............................. AA- 450 439,313
Massachusetts State Turnpike
Authority Metropolitan Highway
System Revenue Series A 5%,
1/1/39............................. AAA 800 651,000
------------
1,090,313
------------
NEW JERSEY--0.3%
New Jersey Sports & Exposition
Authority Revenue Taxable Series A
6.75%,
3/1/10............................. AAA 1,000 938,750
------------
NEW YORK--0.9%
New York City Municipal Water Finance
Authority Water & Sewer System
Revenue Series B 5%, 6/15/29....... AAA 800 666,000
New York State Dormitory Authority
Revenue Taxable 6.90%, 4/1/03...... A- 650 639,438
New York State Taxable Series C
6.35%, 3/1/07...................... AAA 1,500 1,406,250
------------
2,711,688
------------
PENNSYLVANIA--0.7%
Philadelphia Authority For Industrial
Development Pension Funding
Retirement Systems Revenue Taxable
Series A 5.79%, 4/15/09............ AAA 1,100 969,375
Pittsburgh Pension Obligation Taxable
Series C 6.50%, 3/1/17............. AAA 1,250 1,089,063
------------
2,058,438
------------
TEXAS--0.6%
Dallas-Fort Worth International
Airport Revenue Taxable 6.40%,
11/1/07............................ AAA 1,000 941,200
Texas State Veterans Limited Taxable
Series B 6.10%, 12/1/03............ AA 1,000 962,500
------------
1,903,700
------------
TOTAL MUNICIPAL BONDS
(Identified cost $20,131,517)................................ 18,952,944
------------
ASSET-BACKED SECURITIES--3.3%
AESOP Funding II LLC 97-1A, A2 6.40%,
10/20/03 (f)....................... AAA 1,200 1,179,259
Advanta Equipment Receivables 98-1,
A4 5.98%, 12/15/06................. AAA 490 478,975
Capita Equipment Receivables Trust
97-1, B 6.45%, 8/15/02............. A+ 770 759,289
Case Equipment Loan Trust 98-A, A4
5.83%, 2/15/05..................... AAA 1,750 1,725,238
Discover Card Master Trust I 98-7, A
5.60%, 5/16/06..................... AAA 1,200 1,143,000
Ford Credit Auto Owner Trust 99-B, A4
5.80%, 6/15/02..................... AAA 500 494,668
</TABLE>
See Notes to Financial Statements
38
<PAGE>
PHOENIX-OAKHURST BALANCED SERIES
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
ASSET-BACKED SECURITIES--CONTINUED
Green Tree Financial Corp. 96-2, M1
7.60%, 4/15/27..................... AA- $ 675 $ 653,475
Honda Auto Lease Trust 99-A, A5
6.65%, 7/15/05..................... AAA 1,330 1,320,856
Premier Auto Trust 98-3, B 6.14%,
9/8/04............................. A+ 500 491,043
Triangle Funding Ltd. 98-2A, 3
8.028%, 10/15/04 (e)............... BBB 1,500 1,490,156
------------
TOTAL ASSET-BACKED SECURITIES
(Identified cost $9,871,435)................................. 9,735,959
------------
CORPORATE BONDS--4.7%
BANKS (MAJOR REGIONAL)--0.3%
U.S. Bank of Minnesota N.A. 6.30%,
7/15/08............................ A 500 458,125
Wachovia Corp. 5.625%, 12/15/08...... A+ 500 440,625
------------
898,750
------------
BROADCASTING (TELEVISION, RADIO & CABLE)--0.5%
CSC Holdings, Inc. 7.625%, 7/15/18... BB+ 1,000 930,000
Charter Communications Holdings LLC
8.625%, 4/1/09..................... B+ 450 417,375
------------
1,347,375
------------
COMPUTERS (SOFTWARE & SERVICES)--0.2%
Computer Associates International,
Inc. Series B 6.375%, 4/15/05...... BBB+ 535 494,875
------------
ENTERTAINMENT--0.5%
Capitol Records, Inc. 144A 8.375%,
8/15/09 (c)........................ BBB+ 1,500 1,438,125
------------
GAMING, LOTTERY & PARI-MUTUEL COMPANIES--0.2%
Station Casinos, Inc. 10.125%,
3/15/06............................ B+ 500 512,500
------------
HEALTH CARE (HOSPITAL MANAGEMENT)--0.3%
Tenet Healthcare Corp. 8%, 1/15/05... BB+ 1,000 965,000
------------
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)--0.2%
Boston Scientific Corp. 6.625%,
3/15/05............................ BBB 550 507,375
------------
INSURANCE (MULTI-LINE)--0.2%
Willis Corroon Corp. 9%, 2/1/09...... B+ 815 680,525
------------
MANUFACTURING (DIVERSIFIED)--0.3%
American Standard, Inc. 7.375%,
4/15/05............................ BB- 1,000 947,500
------------
PAPER & FOREST PRODUCTS--0.2%
Buckeye Technologies, Inc. 8.50%,
12/15/05........................... BB- 700 686,000
------------
PUBLISHING (NEWSPAPERS)--0.2%
Hollinger International Publishing,
Inc. 9.25%, 3/15/07................ BB- 625 620,312
------------
RETAIL (FOOD CHAINS)--0.3%
Kroger Co. 7.45%, 3/1/08............. BBB- 1,000 973,750
------------
SERVICES (COMMERCIAL & CONSUMER)--0.2%
United Rentals, Inc. Series B 8.80%,
8/15/08............................ BB- 250 237,500
United Rentals, Inc. Series B 9.50%,
6/1/08............................. BB- 250 243,750
------------
481,250
------------
TELECOMMUNICATIONS (LONG DISTANCE)--0.5%
Nextlink Communications, Inc. 10.75%,
11/15/08........................... B 370 384,800
Qwest Communications International,
Inc. Series B 7.50%, 11/1/08....... BB+ 1,100 1,071,125
------------
1,455,925
------------
TELEPHONE--0.1%
Century Telephone Enterprises, Inc.
Series F 6.30%, 1/15/08............ BBB+ 500 453,750
------------
TEXTILES (HOME FURNISHINGS)--0.3%
Westpoint Stevens, Inc. 7.875%,
6/15/05............................ BB 1,000 920,000
------------
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
TRUCKERS--0.1%
Teekay Shipping Corp. 8.32%,
2/1/08............................. BB+ $ 230 $ 207,000
------------
TRUCKS & PARTS--0.1%
Cummins Engine Co., Inc. 6.45%,
3/1/05............................. BBB+ 200 186,500
------------
TOTAL CORPORATE BONDS
(Identified cost $14,514,636)................................ 13,776,512
------------
NON-AGENCY MORTGAGE-BACKED SECURITIES--6.5%
CS First Boston Mortgage Securities
Corp. 97-C2, A3 6.55%, 11/17/07.... AAA 2,500 2,365,625
CS First Boston Mortgage Securities
Corp. 97-C2, B 6.72%, 11/17/07..... Aa(d) 2,000 1,883,750
CS First Boston Mortgage Securities
Corp. 98-C1, A1B 6.48%, 5/17/08.... AAA 500 469,219
DLJ Mortgage Acceptance Corp. 96-CF1,
A1B 144A 7.58%, 2/12/06 (c)........ AAA 1,400 1,399,125
DLJ Commercial Mortgage Corp. 99-CG1,
A1B 6.46%, 1/10/09................. Aaa(d) 2,000 1,862,500
DLJ Commercial Mortgage Corp. 98-CF2,
A1B 6.24%, 11/12/31................ Aaa(d) 2,500 2,301,563
First Union - Lehman Brothers
Commercial Mortgage 97-C1, B 7.43%,
4/18/07............................ Aa(d) 930 905,274
First Union Commercial Mortgage Trust
99-C1, A2 6.07%, 10/15/08.......... AAA 2,000 1,823,828
G.E. Capital Mortgage Services, Inc.
96-8, 1M 7.25%, 5/25/26............ AA 240 232,789
LB Commercial Conduit Mortgage Trust
98-C4, A1B 6.21%, 10/15/08......... AAA 2,500 2,277,179
Lehman Large Loan 97-LLI, B 6.95%,
3/12/07............................ AA+ 825 784,207
Nationslink Funding Corp. 96-1, B
7.69%, 12/20/05.................... AA 450 448,119
Residential Funding Mortgage
Securities I 96-S8, A4 6.75%,
3/25/11............................ AAA 582 565,345
Residential Funding Mortgage
Securities I 96-S1, A11 7.10%,
1/25/26............................ AAA 1,000 954,375
Residential Funding Mortgage
Securities I 96-S4, M1 7.25%,
2/25/26............................ AA 955 913,946
------------
TOTAL NON-AGENCY MORTGAGE-BACKED SECURITIES
(Identified cost $20,229,597)................................ 19,186,844
------------
FOREIGN GOVERNMENT SECURITIES--2.9%
CROATIA--0.4%
Croatia Series B 6.50%, 7/31/06
(e)................................ BBB- 649 598,777
Croatia Series A 6.50%, 7/31/10
(e)................................ BBB- 775 662,625
------------
1,261,402
------------
EL SALVADOR--0.4%
Republic of El Salvador 144A 9.50%,
8/15/06 (c)........................ BB+ 1,200 1,191,000
------------
POLAND--0.7%
Poland Bearer PDI 6%, 10/27/14 (e)... BBB 2,175 1,930,312
------------
SOUTH KOREA--1.1%
Republic of Korea 8.875%, 4/15/08.... BBB 3,000 3,172,500
------------
URUGUAY--0.3%
Republic of Uruguay 7.25%, 5/4/09.... BBB- 1,100 1,045,000
------------
TOTAL FOREIGN GOVERNMENT SECURITIES
(Identified cost $8,629,512)................................. 8,600,214
------------
FOREIGN CORPORATE BONDS--0.4%
ARGENTINA--0.1%
Compania de Radiocomunicaciones
Moviles SA 144A 9.25%, 5/8/08
(c)................................ BBB- 300 261,000
------------
CHILE--0.1%
Compania Sud Americana de Vapores SA
7.375%, 12/8/03.................... BBB 120 115,636
Petropower I Funding Trust 144A
7.36%, 2/15/14 (c)................. BBB 335 297,851
------------
413,487
------------
</TABLE>
See Notes to Financial Statements
39
<PAGE>
PHOENIX-OAKHURST BALANCED SERIES
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
LUXEMBOURG--0.2%
Tyco International Group SA 6.375%,
6/15/05............................ A- $ 600 $ 559,500
------------
TOTAL FOREIGN CORPORATE BONDS
(Identified cost $1,349,704)................................. 1,233,987
------------
</TABLE>
<TABLE>
<CAPTION>
SHARES
--------
<S> <C> <C> <C>
COMMON STOCKS--55.8%
BANKS (MAJOR REGIONAL)--2.0%
Mellon Financial Corp......................... 26,000 885,625
Wells Fargo Co................................ 120,100 4,856,544
------------
5,742,169
------------
BANKS (MONEY CENTER)--1.1%
Bank of America Corp.......................... 66,982 3,361,659
------------
BEVERAGES (NON-ALCOHOLIC)--1.3%
PepsiCo, Inc.................................. 106,600 3,757,650
------------
BROADCASTING (TELEVISION, RADIO & CABLE)--4.2%
AMFM, Inc. (b)................................ 30,800 2,410,100
AT&T Corp.-Liberty Media Group Class A (b).... 110,500 6,270,875
CBS Corp. (b)................................. 36,800 2,352,900
Clear Channel Communications, Inc. (b)........ 16,000 1,428,000
------------
12,461,875
------------
COMMUNICATIONS EQUIPMENT--3.2%
General Motors Corp. Class H (b).............. 17,000 1,632,000
Motorola, Inc................................. 35,000 5,153,750
Tellabs, Inc. (b)............................. 38,400 2,464,800
------------
9,250,550
------------
COMPUTERS (HARDWARE)--5.1%
Dell Computer Corp. (b)....................... 64,900 3,309,900
International Business Machines Corp.......... 53,000 5,724,000
Sun Microsystems, Inc. (b).................... 76,100 5,892,994
------------
14,926,894
------------
COMPUTERS (NETWORKING)--3.3%
Cisco Systems, Inc. (b)....................... 90,000 9,641,250
------------
COMPUTERS (SOFTWARE & SERVICES)--4.7%
America Online, Inc. (b)...................... 42,000 3,168,375
Microsoft Corp. (b)........................... 90,000 10,507,500
------------
13,675,875
------------
CONSUMER FINANCE--0.3%
Capital One Financial Corp.................... 20,500 987,844
------------
DISTRIBUTORS (FOOD & HEALTH)--0.6%
Cardinal Health, Inc.......................... 36,850 1,764,194
------------
ELECTRIC COMPANIES--0.3%
Duke Energy Corp.............................. 15,000 751,875
------------
ELECTRICAL EQUIPMENT--2.3%
General Electric Co........................... 44,300 6,855,425
------------
ELECTRONICS (INSTRUMENTATION)--0.1%
Waters Corp. (b).............................. 8,000 424,000
------------
ELECTRONICS (SEMICONDUCTORS)--2.5%
Intel Corp.................................... 89,200 7,342,275
------------
FINANCIAL (DIVERSIFIED)--4.5%
Citigroup, Inc................................ 97,950 5,442,347
Freddie Mac................................... 34,100 1,604,831
Morgan Stanley Dean Witter & Co............... 44,000 6,281,000
------------
13,328,178
------------
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
HEALTH CARE (DIVERSIFIED)--1.6%
American Home Products Corp................... 27,100 $ 1,068,756
Bristol-Myers Squibb Co....................... 56,900 3,652,269
------------
4,721,025
------------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--1.6%
Pfizer, Inc................................... 62,100 2,014,369
Schering-Plough Corp.......................... 60,100 2,535,469
------------
4,549,838
------------
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)--1.2%
Bard (C.R.), Inc.............................. 25,000 1,325,000
Baxter International, Inc..................... 35,900 2,254,969
------------
3,579,969
------------
HOUSEHOLD PRODUCTS (NON-DURABLE)--1.7%
Fort James Corp............................... 8,700 238,162
Kimberly-Clark Corp........................... 9,700 632,925
Procter & Gamble Co. (The).................... 38,500 4,218,156
------------
5,089,243
------------
INSURANCE (MULTI-LINE)--1.4%
American International Group, Inc............. 37,250 4,027,656
------------
LODGING-HOTELS--0.6%
Carnival Corp................................. 38,500 1,840,781
------------
MANUFACTURING (DIVERSIFIED)--1.6%
Tyco International Ltd........................ 118,600 4,610,575
------------
OIL & GAS (DRILLING & EQUIPMENT)--0.9%
Halliburton Co................................ 21,900 881,475
Schlumberger Ltd.............................. 14,200 798,750
Transocean Sedco Forex, Inc................... 32,749 1,103,236
------------
2,783,461
------------
OIL & GAS (EXPLORATION & PRODUCTION)--0.3%
Anadarko Petroleum Corp....................... 28,000 955,500
------------
OIL (DOMESTIC INTEGRATED)--0.6%
Conoco, Inc. Class A.......................... 68,300 1,690,425
------------
PAPER & FOREST PRODUCTS--0.3%
Georgia-Pacific Group......................... 5,000 253,750
International Paper Co........................ 8,500 479,719
------------
733,469
------------
PERSONAL CARE--0.3%
Gillette Co. (The)............................ 23,500 967,906
------------
RETAIL (BUILDING SUPPLIES)--1.8%
Home Depot, Inc. (The)........................ 75,000 5,142,187
------------
RETAIL (COMPUTERS & ELECTRONICS)--0.2%
Tandy Corp.................................... 14,500 713,219
------------
RETAIL (FOOD CHAINS)--0.3%
Safeway, Inc. (b)............................. 22,400 796,600
------------
RETAIL (GENERAL MERCHANDISE)--2.1%
Wal-Mart Stores, Inc.......................... 89,600 6,193,600
------------
RETAIL (SPECIALTY)--0.4%
Staples, Inc. (b)............................. 54,475 1,130,335
------------
TELECOMMUNICATIONS (LONG DISTANCE)--2.6%
AT&T Corp..................................... 85,747 4,351,660
MCI WorldCom, Inc. (b)........................ 61,763 3,277,273
------------
7,628,933
------------
TELEPHONE--0.7%
SBC Communications, Inc....................... 44,400 2,164,500
------------
TEXTILES (APPAREL)--0.1%
Tommy Hilfiger Corp. (b)...................... 14,400 335,700
------------
TOTAL COMMON STOCKS
(Identified cost $102,676,208)........................... 163,926,635
------------
</TABLE>
See Notes to Financial Statements
40
<PAGE>
PHOENIX-OAKHURST BALANCED SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
FOREIGN COMMON STOCKS--3.1%
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--0.2%
Elan Corp. PLC Sponsored ADR (Ireland) (b).... 22,000 $ 649,000
------------
OIL (INTERNATIONAL INTEGRATED)--1.7%
BP Amoco PLC Sponsored ADR (United Kingdom)... 85,372 5,063,627
------------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--1.2%
Vodafone AirTouch PLC Sponsored ADR (United
Kingdom).................................... 68,500 3,390,750
------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $5,156,289)............................. 9,103,377
------------
UNIT INVESTMENT TRUSTS--1.3%
S&P 500 Depository Receipts................... 25,200 3,701,250
------------
TOTAL UNIT INVESTMENT TRUSTS
(Identified cost $3,311,113)............................. 3,701,250
------------
TOTAL LONG-TERM INVESTMENTS--97.2%
(Identified cost $224,705,144)........................... 285,774,017
------------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--2.3%
COMMERCIAL PAPER--2.3%
Anheuser Busch Cos., Inc. 4.50%,
1/3/00............................. A-1+ $6,765 $ 6,763,309
------------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $6,763,309)................................. 6,763,309
------------
TOTAL INVESTMENTS--99.5%
(Identified cost $231,468,453)............................... 292,537,326(a)
Cash and receivables, less liabilities--0.5%................. 1,378,097
------------
NET ASSETS--100.0%............................................. $293,915,423
============
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $68,614,419 and gross depreciation of $7,641,779 for
federal income tax purposes. At December 31,1999, the
aggregate cost of securities for federal income tax purposes
was $231,564,686.
(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 December 31,1999, these securities
amounted to a value of $4,587,101 or 1.56% of net assets.
(d) As rated by Moody's, Fitch or Duff & Phelps.
(e) Variable or step coupon security; interest rate shown
reflects the rate currently in effect.
(f) Private placement.
</TABLE>
See Notes to Financial Statements
41
<PAGE>
PHOENIX-OAKHURST BALANCED SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$231,468,453)............................................. $ 292,537,326
Cash........................................................ 4,184
Receivables
Interest and dividends.................................... 1,809,548
Fund shares sold.......................................... 9,407
Prepaid expenses............................................ 4,230
--------------
Total assets............................................ 294,364,695
--------------
LIABILITIES
Payables
Fund shares repurchased................................... 156,668
Investment advisory fee................................... 134,324
Trustees' fee............................................. 6,958
Financial agent fee....................................... 23,090
Accrued expenses............................................ 128,232
--------------
Total liabilities....................................... 449,272
--------------
NET ASSETS.................................................. $ 293,915,423
==============
NET ASSETS CONSIST OF:
Capital paid in on shares of benefical interest........... $ 229,326,354
Undistributed net investment income....................... 259,862
Accumulated net realized gain............................. 3,260,334
Net unrealized appreciation............................... 61,068,873
--------------
NET ASSETS.................................................. $ 293,915,423
==============
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 20,357,300
==============
Net asset value and offering price per share................ $ 14.44
==============
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $ 7,633,429
Dividends................................................. 1,319,024
Foreign taxes withheld.................................... (11,112)
-----------
Total investment income................................. 8,941,341
-----------
EXPENSES
Investment advisory fee................................... 1,553,692
Financial agent fee....................................... 248,565
Printing.................................................. 65,328
Custodian................................................. 64,645
Professional.............................................. 31,288
Trustees.................................................. 16,786
Miscellaneous............................................. 24,894
-----------
Total expenses.......................................... 2,005,198
-----------
NET INVESTMENT INCOME....................................... 6,936,143
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 11,701,741
Net change in unrealized appreciation (depreciation) on
investments............................................. 12,901,146
-----------
NET GAIN ON INVESTMENTS..................................... 24,602,887
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $31,539,030
===========
</TABLE>
See Notes to Financial Statements
42
<PAGE>
PHOENIX-OAKHURST BALANCED SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
------------------- -------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 6,936,143 $ 6,484,210
Net realized gain (loss).................................. 11,701,741 1,823,127
Net change in unrealized appreciation (depreciation)...... 12,901,146 36,386,238
------------ ------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 31,539,030 44,693,575
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (6,933,758) (6,299,939)
Net realized gains........................................ (10,209,970) (9,082,295)
------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (17,143,728) (15,382,234)
------------ ------------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (4,020,389 and 4,750,917
shares, respectively)................................... 55,944,281 60,237,782
Net asset value of shares issued from reinvestment of
distributions
(1,209,732 and 1,187,415 shares, respectively).......... 17,143,728 15,382,234
Cost of shares repurchased (5,259,610 and 4,412,737
shares, respectively)................................... (73,623,531) (56,055,533)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ (535,522) 19,564,483
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS..................... 13,859,780 48,875,824
NEW ASSETS
Beginning of period....................................... 280,055,643 231,179,819
------------ ------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF
$259,862 AND $244,131, RESPECTIVELY).................... $293,915,423 $280,055,643
============ ============
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1999 1998 1997 1996 1995
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period........................ $13.74 $12.26 $12.06 $12.30 $10.53
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.34 0.33 0.38 0.36 0.40(1)
Net realized and unrealized gain (loss)................... 1.22 1.94 1.73 0.89 2.02
------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS........................ 1.56 2.27 2.11 1.25 2.42
------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.34) (0.32) (0.40) (0.35) (0.40)
Dividends from net realized gains......................... (0.52) (0.47) (1.51) (1.14) (0.25)
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS..................................... (0.86) (0.79) (1.91) (1.49) (0.65)
------ ------ ------ ------ ------
CHANGE IN NET ASSET VALUE................................... 0.70 1.48 0.20 (0.24) 1.77
------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD.............................. $14.44 $13.74 $12.26 $12.06 $12.30
====== ====== ====== ====== ======
Total return................................................ 11.57% 19.01% 17.93% 10.56% 23.28%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $293,915 $280,056 $231,180 $204,285 $193,302
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses........................................ 0.70% 0.68% 0.71% 0.68% 0.65%(2)
Net investment income..................................... 2.43% 2.58% 2.92% 2.93% 3.44%
Portfolio turnover rate..................................... 61% 110% 181% 229% 223%
</TABLE>
(1) Computed using average shares outstanding.
(2) The ratio of operating expenses to average net assets excludes the effect of
expense offsets for custodian fees; if expense offsets were included, the
ratio would not significantly differ.
See Notes to Financial Statements
43
<PAGE>
PHOENIX-OAKHURST GROWTH AND INCOME SERIES
INVESTMENT OBJECTIVE
The Fund is appropriate for investors seeking dividend growth, current
income and capital appreciation through investments in common stocks.
INVESTMENT ADVISOR'S REPORT
Fears of Y2K-related disasters were put to rest as stocks ended the year
with a party of their own. The Nasdaq Composite Index(1), which is heavily
weighted with technology high-fliers, finished the year at a record high with an
unheard of 86.13% total return. The more-established Dow Jones Industrial
Average(2) and Standard & Poor's 500(3) Index also finished at record levels, up
27.20% and 21.14%, respectively. Their five-year string of double-digit gains
was unprecedented. Even the once-moribund Russell 2000(4) Index of
small-capitalization stocks outgained the S&P 500 with a 21.26% total return. In
terms of investment styles, growth stocks returned more than value-type
companies. The S&P/BARRA Growth Index(5) returned 28.25% versus a 12.73% return
for the S&P/BARRA Value Index(6).
1999 was the year of the "momentum investor." Characteristics of winning
stocks included price momentum, revenue growth, high p/e multiple, stock split
and Internet involvement. It was a year of a red-hot economy, accelerating
earnings growth and rising interest rates. There was an IPO boom and the start
of a day-trading craze.
The Federal Open Market Committee raised interest rates three times last
year. Fed officials feared rapid growth in Gross Domestic Product, tight labor
markets and rising commodity prices would ignite inflationary pressures. For
now, the so-called "Goldilocks economy" continues its record of above-trend
growth with inflationary pressures offset by record worker productivity.
Phoenix-Oakhurst Growth & Income returned 17.00% for the year ended 1999.
The portfolio lagged the 21.14% return on the S&P 500, but beat the 11.23%
return for the average for a large-cap value mutual fund in a peer group of 279
funds. All performance figures assume reinvestment of distributions and are net
of sales charges.
Rising interest rates had an adverse impact on the portfolio's holdings in
the financial-services and utility sectors. Even stocks like Ford Motor, which
had strong performance as a business, lost value as investors had a much
stronger appetite for tech stocks. In fact, most of the stocks we purchased for
their attractive valuation remained cheap at year-end.
The portfolio did hold several stocks with strong gains. We owned shares of
two companies (General Instrument and Gulfstream Aerospace) that were merger
targets and had significant gains as a result of the buyout. Apple Computer rose
145% due to strong sales of its iMac, iBook, G4 and PowerBook computers. Morgan
Stanley Dean Witter rose 103% as earnings were boosted by strength in investment
banking, trading and asset management. Amgen rose 87% from a renewed interest in
biotechnology stocks and a string of positive earnings surprises.
OUTLOOK
We believe GDP growth will moderate as rising interest rates slow down
housing activity and consumer spending. Inflation should be slightly higher than
last year as a result of rising commodity prices. Tight labor markets, a strong
global economy and rising inflation should result in slightly higher interest
rates. S&P 500 earnings from continuing operations are forecast to grow about
12%, with the biggest gains in the basic materials and energy sectors. Utility
and auto stocks are currently trading at bargain prices. We feel the technology
sector is relatively expensive as we enter the year 2000, but earnings are
expected to grow at a robust pace.
After the amazing double-digit advances in stock indices over the last five
years, we feel investors should not expect gains like this to continue. We are
excited and optimistic about the future, but feel returns going forward may
revert to more reasonable historical averages.
(1) The Nasdaq Composite Index is an unmanaged, commonly used measure of
primarily technology stock total return performance, since the index is
two-third composed of technology stocks.
(2) The Dow Jones Industrial Average is an unmanaged, commonly used measure of
domestic industrial stock total return performance.
(3) The S&P 500 Index is an unmanaged, commonly used measure of stock market
total return performance.
(4) The Russell 2000 Index is an unmanaged, commonly used measure of small-cap
stock total return performance.
(5) The S&P/BARRA Growth Index is an unmanaged, commonly used measure of
large-cap, growth-oriented stock total return performance.
(6) The S&P/BARRA Value Index is an unmanaged, commonly used measure large-cap,
value-oriented stock total return performance.
The indices are not available for direct investment.
44
<PAGE>
PHOENIX-OAKHURST GROWTH AND INCOME SERIES
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GROWTH AND INCOME SERIES S&P 500 INDEX*
<S> <C> <C>
3/2/1998 $10,000.00 $10,000.00
12/31/1998 $12,045.30 $11,895.30
12/31/1999 $14,093.30 $14,409.38
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C>
FROM
INCEPTION
3/2/98
TO
1 YEAR 12/31/99
- -------------------------------------------------------------------------------------
Growth and Income Series 17.00% 20.59%
- -------------------------------------------------------------------------------------
S&P 500 Index* 21.14% 22.06%
- -------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 3/2/98.
Returns shown include the reinvestment of all distributions at net asset value,
and the change in share price for the stated period. Returns indicate past
performance, which is not predictive of future performance. Investment return
and net asset value will fluctuate so that your shares, when redeemed, may be
worth more or less than the original cost. Foreign investing involves special
risks such as currency fluctuation and less public disclosure, as well as
economic and political risks.
* The S&P 500 Index is an unmanaged but commonly used measure of stock market
total return performance. The index is not available for direct investment.
45
<PAGE>
PHOENIX-OAKHURST GROWTH AND INCOME SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
COMMON STOCKS--94.9%
AEROSPACE/DEFENSE--1.7%
Boeing Co. (The)................................. 21,700 $ 901,906
General Dynamics Corp............................ 14,900 785,975
------------
1,687,881
------------
AIRLINES--0.0%
Alaska Air Group, Inc. (b)....................... 400 14,050
------------
ALUMINUM--0.2%
Alcoa, Inc....................................... 2,700 224,100
------------
AUTO PARTS & EQUIPMENT--0.1%
TRW, Inc......................................... 1,800 93,487
------------
AUTOMOBILES--2.8%
Ford Motor Co.................................... 32,700 1,747,406
General Motors Corp.............................. 14,900 1,083,044
------------
2,830,450
------------
BANKS (MAJOR REGIONAL)--1.4%
Bank One Corp.................................... 19,200 615,600
Wells Fargo Co................................... 19,500 788,531
------------
1,404,131
------------
BANKS (MONEY CENTER)--3.1%
Bank of America Corp............................. 11,000 552,062
Chase Manhattan Corp. (The)...................... 21,100 1,639,206
Morgan (J.P.) & Co., Inc......................... 7,300 924,362
------------
3,115,630
------------
BANKS (REGIONAL)--0.7%
Cullen/Frost Bankers, Inc........................ 5,200 133,900
UnionBanCal Corp................................. 14,400 567,900
------------
701,800
------------
BEVERAGES (ALCOHOLIC)--0.6%
Anheuser-Busch Cos., Inc......................... 6,000 425,250
Coors (Adolph) Co. Class B....................... 2,600 136,500
------------
561,750
------------
BEVERAGES (NON-ALCOHOLIC)--1.1%
Coca-Cola Co. (The).............................. 16,600 966,950
PepsiCo, Inc..................................... 5,200 183,300
------------
1,150,250
------------
BIOTECHNOLOGY--0.6%
Amgen, Inc. (b).................................. 9,800 588,612
------------
BROADCASTING (TELEVISION, RADIO & CABLE)--0.4%
CBS Corp. (b).................................... 2,600 166,237
Clear Channel Communications, Inc. (b)........... 2,800 249,900
------------
416,137
------------
BUILDING MATERIALS--0.1%
Owens Corning.................................... 3,700 71,456
------------
CHEMICALS--0.8%
Dow Chemical Co. (The)........................... 5,600 748,300
Geon Co. (The)................................... 2,200 71,500
------------
819,800
------------
CHEMICALS (SPECIALTY)--0.4%
Lubrizol Corp. (The)............................. 10,200 314,925
W.R. Grace & Co. (b)............................. 8,600 119,325
------------
434,250
------------
COMMUNICATIONS EQUIPMENT--3.5%
ADC Telecommunications, Inc. (b)................. 2,300 166,894
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
COMMUNICATIONS EQUIPMENT--CONTINUED
Comverse Technology, Inc. (b).................... 3,000 $ 434,250
General Instrument Corp. (b)..................... 2,200 187,000
Lucent Technologies, Inc......................... 19,900 1,488,769
Motorola, Inc.................................... 5,400 795,150
QUALCOMM, Inc. (b)............................... 2,000 352,500
Scientific-Atlanta, Inc.......................... 1,600 89,000
Tellabs, Inc. (b)................................ 1,200 77,025
------------
3,590,588
------------
COMPUTERS (HARDWARE)--5.4%
Apple Computer, Inc. (b)......................... 4,200 431,812
Dell Computer Corp. (b).......................... 13,700 698,700
Electronics for Imaging, Inc. (b)................ 7,100 412,687
Hewlett-Packard Co............................... 12,200 1,390,037
International Business Machines Corp............. 17,500 1,890,000
NCR Corp. (b).................................... 3,100 117,412
Sun Microsystems, Inc. (b)....................... 7,000 542,062
------------
5,482,710
------------
COMPUTERS (NETWORKING)--2.4%
3Com Corp. (b)................................... 6,000 282,000
Cabletron Systems, Inc. (b)...................... 12,600 327,600
Cisco Systems, Inc. (b).......................... 17,000 1,821,125
------------
2,430,725
------------
COMPUTERS (PERIPHERALS)--0.4%
EMC Corp. (b).................................... 3,700 404,225
------------
COMPUTERS (SOFTWARE & SERVICES)--8.2%
Adobe Systems, Inc............................... 1,000 67,250
America Online, Inc. (b)......................... 19,200 1,448,400
Computer Associates International, Inc........... 1,600 111,900
Compuware Corp. (b).............................. 4,900 182,525
Informix Corp. (b)............................... 14,700 167,212
Microsoft Corp. (b).............................. 41,100 4,798,425
Oracle Corp. (b)................................. 9,300 1,042,181
Rational Software Corp. (b)...................... 1,400 68,775
Sterling Software, Inc. (b)...................... 1,500 47,250
Synopsys, Inc. (b)............................... 800 53,400
USWeb Corp. (b).................................. 2,000 88,875
Unisys Corp. (b)................................. 9,100 290,631
------------
8,366,824
------------
CONSUMER FINANCE--0.4%
MBNA Corp........................................ 11,100 302,475
Providian Financial Corp......................... 1,300 118,381
------------
420,856
------------
CONTAINERS & PACKAGING (PAPER)--0.2%
Temple-Inland, Inc............................... 2,700 178,031
------------
CONTAINERS (METAL & GLASS)--0.1%
Ball Corp........................................ 3,300 129,937
------------
DISTRIBUTORS (FOOD & HEALTH)--0.6%
Andrx Corp. (b).................................. 3,100 131,169
Patterson Dental Co. (b)......................... 4,600 196,075
SUPERVALU, Inc................................... 12,500 250,000
------------
577,244
------------
ELECTRIC COMPANIES--4.5%
DTE Energy Co.................................... 14,700 461,212
Duke Energy Corp................................. 11,600 581,450
Edison International............................. 19,100 500,181
Energy East Corp................................. 28,200 586,912
</TABLE>
See Notes to Financial Statements
46
<PAGE>
PHOENIX-OAKHURST GROWTH AND INCOME SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
ELECTRIC COMPANIES--CONTINUED
GPU, Inc......................................... 16,500 $ 493,969
Minnesota Power, Inc............................. 7,200 121,950
PECO Energy Co................................... 9,200 319,700
Public Service Enterprise Group, Inc............. 1,200 41,775
Puget Sound Energy, Inc.......................... 1,600 31,000
Texas Utilities Co............................... 24,300 864,169
Unicom Corp...................................... 6,900 231,150
UtiliCorp United, Inc............................ 17,200 334,325
------------
4,567,793
------------
ELECTRICAL EQUIPMENT--2.9%
General Electric Co.............................. 17,800 2,754,550
Solectron Corp. (b).............................. 1,900 180,737
------------
2,935,287
------------
ELECTRONICS (INSTRUMENTATION)--0.1%
PE Corp.-PE Biosystems Group..................... 1,100 132,344
------------
ELECTRONICS (SEMICONDUCTORS)--3.9%
Adaptec, Inc. (b)................................ 6,600 329,175
Integrated Device Technology, Inc. (b)........... 7,900 229,100
Intel Corp....................................... 26,500 2,181,281
Micron Technology, Inc. (b)...................... 3,900 303,225
National Semiconductor Corp. (b)................. 3,100 132,719
Texas Instruments, Inc........................... 8,100 784,687
------------
3,960,187
------------
ENTERTAINMENT--1.1%
Time Warner, Inc................................. 10,400 753,350
Viacom, Inc. Class B (b)......................... 5,300 320,319
------------
1,073,669
------------
EQUIPMENT (SEMICONDUCTOR)--1.0%
Applied Materials, Inc. (b)...................... 5,600 709,450
KLA-Tencor Corp. (b)............................. 1,100 122,512
Lam Research Corp. (b)........................... 1,000 111,562
Teradyne, Inc. (b)............................... 1,800 118,800
------------
1,062,324
------------
FINANCIAL (DIVERSIFIED)--5.7%
Ambac Financial Group, Inc....................... 4,000 208,750
Citigroup, Inc................................... 52,700 2,928,144
Fannie Mae....................................... 12,900 805,444
Freddie Mac...................................... 5,100 240,019
Morgan Stanley Dean Witter & Co.................. 11,700 1,670,175
------------
5,852,532
------------
FOODS--1.5%
ConAgra, Inc..................................... 5,800 130,862
General Mills, Inc............................... 1,000 35,750
Hormel Foods Corp................................ 8,700 353,437
International Home Foods, Inc. (b)............... 14,400 250,200
Keebler Foods Co. (b)............................ 2,200 61,875
Kellogg Co....................................... 6,000 184,875
Quaker Oats Co. (The)............................ 8,400 551,250
------------
1,568,249
------------
FOOTWEAR--0.1%
NIKE, Inc. Class B............................... 2,200 109,037
------------
HARDWARE & TOOLS--0.1%
Black & Decker Corp. (The)....................... 2,200 114,950
------------
HEALTH CARE (DIVERSIFIED)--2.5%
Abbott Laboratories.............................. 6,100 221,506
Bristol-Myers Squibb Co.......................... 17,000 1,091,188
Johnson & Johnson................................ 9,400 875,375
Mallinckrodt, Inc................................ 3,100 98,619
Warner-Lambert Co................................ 3,700 303,169
------------
2,589,857
------------
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--3.4%
Forest Laboratories, Inc. (b).................... 4,800 $ 294,900
Lilly (Eli) & Co................................. 14,000 931,000
Merck & Co., Inc................................. 6,900 462,731
Pfizer, Inc...................................... 27,000 875,813
Pharmacia & Upjohn, Inc.......................... 9,600 432,000
Schering-Plough Corp............................. 10,000 421,875
------------
3,418,319
------------
HEALTH CARE (GENERIC AND OTHER)--0.3%
Jones Pharma, Inc................................ 7,200 312,750
------------
HEALTH CARE (MANAGED CARE)--0.9%
Oxford Health Plans, Inc. (b).................... 5,200 65,975
PacifiCare Health Systems, Inc. (b).............. 3,100 164,300
Trigon Healthcare, Inc. (b)...................... 3,800 112,100
United HealthCare Corp........................... 8,400 446,250
Wellpoint Health Networks, Inc. (b).............. 1,600 105,500
------------
894,125
------------
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)--0.2%
Baxter International, Inc........................ 3,500 219,844
------------
HEALTH CARE (SPECIALIZED SERVICES)--0.0%
Apria Healthcare Group, Inc. (b)................. 2,300 41,256
------------
HOMEBUILDING--0.1%
Pulte Corp....................................... 2,600 58,500
------------
HOUSEHOLD FURNISHINGS & APPLIANCES--0.3%
Whirlpool Corp................................... 4,500 292,781
------------
HOUSEHOLD PRODUCTS (NON-DURABLE)--2.4%
Church & Dwight Co., Inc......................... 11,100 296,231
Kimberly-Clark Corp.............................. 12,300 802,575
Procter & Gamble Co. (The)....................... 12,000 1,314,750
------------
2,413,556
------------
HOUSEWARES--0.2%
Tupperware Corp.................................. 13,000 220,188
------------
INSURANCE (LIFE/HEALTH)--0.5%
Lincoln National Corp............................ 11,700 468,000
------------
INSURANCE (MULTI-LINE)--0.2%
CIGNA Corp....................................... 2,100 169,181
Loews Corp....................................... 1,100 66,756
------------
235,937
------------
INSURANCE (PROPERTY-CASUALTY)--0.1%
MGIC Investment Corp............................. 1,000 60,188
------------
INSURANCE BROKERS--1.3%
Gallagher (Arthur J.) & Co....................... 5,400 349,650
Marsh & McLennan Cos., Inc....................... 9,700 928,169
------------
1,277,819
------------
INVESTMENT BANKING/BROKERAGE--1.1%
AXA Financial, Inc............................... 12,600 426,825
Lehman Brothers Holdings, Inc.................... 3,100 262,531
Merrill Lynch & Co., Inc......................... 5,600 467,600
------------
1,156,956
------------
IRON & STEEL--0.1%
Nucor Corp....................................... 2,000 109,625
------------
LODGING-HOTELS--0.3%
Carnival Corp.................................... 7,100 339,469
------------
</TABLE>
See Notes to Financial Statements
47
<PAGE>
PHOENIX-OAKHURST GROWTH AND INCOME SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
MACHINERY (DIVERSIFIED)--0.3%
Ingersoll-Rand Co................................ 1,500 $ 82,594
Manitowoc Co., Inc. (The)........................ 1,500 51,000
Tecumseh Products Co. Class A.................... 3,700 174,594
------------
308,188
------------
MANUFACTURING (DIVERSIFIED)--2.6%
American Standard Companies, Inc. (b)............ 6,000 275,250
Honeywell International, Inc..................... 3,600 207,675
Johnson Controls, Inc............................ 1,500 85,313
Minnesota Mining and Manufacturing Co............ 3,200 313,200
National Service Industries, Inc................. 4,200 123,900
Tyco International Ltd........................... 26,800 1,041,850
United Technologies Corp......................... 9,300 604,500
------------
2,651,688
------------
MANUFACTURING (SPECIALIZED)--0.2%
Brady Corp. Class A.............................. 4,400 149,325
Briggs & Stratton Corp........................... 1,600 85,800
------------
235,125
------------
NATURAL GAS--0.5%
Equitable Resources, Inc......................... 10,500 350,438
Sempra Energy.................................... 8,900 154,638
------------
505,076
------------
OIL & GAS (EXPLORATION & PRODUCTION)--1.1%
Anadarko Petroleum Corp.......................... 9,400 320,775
Apache Corp...................................... 10,200 376,763
Kerr-McGee Corp.................................. 7,600 471,200
------------
1,168,738
------------
OIL & GAS (REFINING & MARKETING)--0.4%
Ultramar Diamond Shamrock Corp................... 20,200 458,288
------------
OIL (DOMESTIC INTEGRATED)--0.8%
Amerada Hess Corp................................ 3,200 181,600
Atlantic Richfield Co............................ 7,000 605,500
------------
787,100
------------
OIL (INTERNATIONAL INTEGRATED)--1.9%
Chevron Corp..................................... 6,400 554,400
Exxon Mobil Corp................................. 15,064 1,213,594
Texaco, Inc...................................... 3,000 162,938
------------
1,930,932
------------
PAPER & FOREST PRODUCTS--0.9%
Georgia-Pacific Group............................ 5,900 299,425
International Paper Co........................... 2,800 158,025
Louisiana-Pacific Corp........................... 10,800 153,900
Weyerhaeuser Co.................................. 3,300 236,981
Willamette Industries, Inc....................... 500 23,219
------------
871,550
------------
PERSONAL CARE--0.1%
Alberto-Culver Co. Class B....................... 3,400 87,763
------------
PHOTOGRAPHY/IMAGING--0.3%
Eastman Kodak Co................................. 5,000 331,250
------------
PUBLISHING--0.1%
Reader's Digest.................................. 4,200 122,850
------------
PUBLISHING (NEWSPAPERS)--0.7%
Knight-Ridder, Inc............................... 7,700 458,150
Times Mirror Co. (The) Class A................... 1,300 87,100
Tribune Co....................................... 3,800 209,238
------------
754,488
------------
RAILROADS--0.3%
Union Pacific Corp............................... 6,500 283,563
------------
RESTAURANTS--0.3%
Darden Restaurants, Inc.......................... 7,300 132,313
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
RESTAURANTS--CONTINUED
Tricon Global Restaurants, Inc. (b).............. 3,800 $ 146,775
------------
279,088
------------
RETAIL (BUILDING SUPPLIES)--1.1%
Home Depot, Inc. (The)........................... 14,100 966,731
Lowe's Companies., Inc........................... 3,100 185,225
------------
1,151,956
------------
RETAIL (COMPUTERS & ELECTRONICS)--0.4%
Best Buy Co., Inc. (b)........................... 4,500 225,844
Circuit City Stores-Circuit City Group........... 3,300 148,706
------------
374,550
------------
RETAIL (DEPARTMENT STORES)--0.3%
Federated Department Stores, Inc. (b)............ 5,500 278,094
------------
RETAIL (DISCOUNTERS)--0.0%
Ross Stores, Inc................................. 2,200 39,463
------------
RETAIL (GENERAL MERCHANDISE)--2.6%
Costco Wholesale Corp. (b)....................... 3,000 273,750
Dayton Hudson Corp............................... 1,900 139,531
Wal-Mart Stores, Inc............................. 31,900 2,205,088
------------
2,618,369
------------
RETAIL (SPECIALTY)--0.1%
Zale Corp. (b)................................... 2,200 106,425
------------
RETAIL (SPECIALTY-APPAREL)--0.7%
Abercrombie & Fitch Co. Class A (b).............. 3,900 104,081
AnnTaylor Stores Corp. (b)....................... 1,600 55,100
Gap, Inc. (The).................................. 7,400 340,400
TJX Cos., Inc. (The)............................. 10,400 212,550
------------
712,131
------------
SERVICES (ADVERTISING/MARKETING)--0.1%
Omnicom Group, Inc............................... 1,300 130,000
------------
SERVICES (COMMERCIAL & CONSUMER)--0.4%
Block (H&R), Inc................................. 6,700 293,125
Hertz Corp. (The) Class A........................ 1,500 75,188
------------
368,313
------------
SERVICES (COMPUTER SYSTEMS)--0.6%
CSG Systems International, Inc. (b).............. 2,400 95,700
Electronic Data Systems Corp..................... 7,600 508,725
------------
604,425
------------
SERVICES (DATA PROCESSING)--0.8%
Concord EFS, Inc. (b)............................ 4,500 115,875
First Data Corp.................................. 4,200 207,113
Paychex, Inc..................................... 11,700 468,000
------------
790,988
------------
SPECIALTY PRINTING--0.3%
Deluxe Corp...................................... 11,000 301,813
------------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--0.6%
Nextel Communications, Inc. Class A (b).......... 1,500 154,688
Sprint Corp. (PCS Group) (b)..................... 4,800 492,000
------------
646,688
------------
TELECOMMUNICATIONS (LONG DISTANCE)--2.4%
AT&T Corp........................................ 24,300 1,233,225
MCI WorldCom, Inc. (b)........................... 22,800 1,209,825
------------
2,443,050
------------
TELEPHONE--3.4%
Bell Atlantic Corp............................... 8,900 547,906
BellSouth Corp................................... 20,800 973,700
GTE Corp......................................... 6,100 430,431
SBC Communications, Inc.......................... 32,000 1,560,000
------------
3,512,037
------------
</TABLE>
See Notes to Financial Statements
48
<PAGE>
PHOENIX-OAKHURST GROWTH AND INCOME SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
TEXTILES (APPAREL)--0.2%
Jones Apparel Group, Inc. (b).................... 3,900 $ 105,788
Tommy Hilfiger Corp. (b)......................... 5,400 125,888
------------
231,676
------------
TOBACCO--0.4%
Philip Morris Companies, Inc..................... 17,700 410,419
------------
TOTAL COMMON STOCKS
(Identified cost $81,667,775).............................. 96,676,550
------------
FOREIGN COMMON STOCKS--2.9%
COMMUNICATIONS EQUIPMENT--0.6%
Nortel Networks Corp. (Canada)................... 5,800 585,800
------------
FOODS--0.7%
Unilever NV NY Registered Shares (Netherlands)... 13,500 734,906
------------
OIL (INTERNATIONAL INTEGRATED)--1.4%
BP Amoco PLC Sponsored ADR (United Kingdom)...... 5,800 344,012
Royal Dutch Petroleum Co. (Netherlands).......... 18,300 1,106,006
------------
1,450,018
------------
RAILROADS--0.2%
Canadian National Railway Co. (Canada)........... 6,600 173,663
------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $2,568,925)............................... 2,944,387
------------
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
UNIT INVESTMENT TRUSTS--2.9%
S&P 500 Depository Receipts...................... 20,000 $ 2,937,500
------------
TOTAL UNIT INVESTMENT TRUSTS
(Identified cost $2,639,648)............................... 2,937,500
------------
TOTAL LONG-TERM INVESTMENTS --100.7%
(Identified cost $86,876,348).............................. 102,558,437
------------
</TABLE>
<TABLE>
<CAPTION>
PAR
VALUE
(000)
--------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--0.2%
FEDERAL AGENCY SECURITIES--0.2%
Freddie Mac Discount Note 1.28%, 1/3/00 $200 199,986
------------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $199,986)................................. 199,986
------------
TOTAL INVESTMENTS --100.9%
(Identified cost $87,076,334).............................. 102,758,423(a)
Cash and receivables, less liabilities--(0.9%)............. (924,679)
------------
NET ASSETS--100.0%........................................... $101,833,744
============
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information; Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $20,234,720 and gross depreciation of $4,603,947 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purposes
was $87,127,650.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
49
<PAGE>
PHOENIX-OAKHURST GROWTH AND INCOME SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$87,076,334).............................................. $102,758,423
Cash........................................................ 3,764
Receivables
Fund shares sold.......................................... 134,820
Dividends and interest.................................... 123,100
Prepaid expenses............................................ 586
------------
Total assets............................................ 103,020,693
------------
LIABILITIES
Payables
Fund shares repurchased................................... 1,069,777
Investment advisory fee................................... 36,051
Financial agent fee....................................... 11,873
Trustees' fee............................................. 6,959
Accrued expenses............................................ 62,289
------------
Total liabilities....................................... 1,186,949
------------
NET ASSETS.................................................. $101,833,744
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $ 86,202,972
Accumulated net realized loss............................. (51,317)
Net unrealized appreciation............................... 15,682,089
------------
NET ASSETS.................................................. $101,833,744
============
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 7,525,121
============
Net asset value and offering price per share................ $ 13.53
============
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 1,107,632
Interest.................................................. 46,942
Foreign taxes withheld.................................... (9,611)
-----------
Total investment income................................. 1,144,963
-----------
EXPENSES
Investment advisory fee................................... 513,418
Financial agent fee....................................... 107,958
Custodian................................................. 43,431
Professional.............................................. 23,178
Printing.................................................. 21,764
Trustees.................................................. 18,302
Miscellaneous............................................. 10,551
-----------
Total expenses.......................................... 738,602
Less expenses borne by investment adviser............... (115,166)
-----------
Net expenses............................................ 623,436
-----------
NET INVESTMENT INCOME....................................... 521,527
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 1,227,412
Net realized gains on written options..................... 26,978
Net change in unrealized appreciation (depreciation) on
investments............................................. 10,636,397
-----------
NET GAIN ON INVESTMENTS..................................... 11,890,787
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $12,412,314
===========
</TABLE>
See Notes to Financial Statements
50
<PAGE>
PHOENIX-OAKHURST GROWTH AND INCOME SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
YEAR ENDED 3/2/98 TO
12/31/99 12/31/98
------------ -------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 521,527 $ 159,891
Net realized gain (loss).................................. 1,254,390 (430,367)
Net change in unrealized appreciation (depreciation)...... 10,636,397 5,045,692
------------ -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 12,412,314 4,775,216
------------ -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (517,138) (159,891)
Net realized gains........................................ (824,281) --
In excess of net investment income........................ (4,389) (4,132)
In excess of net realized gains........................... (400,735) --
Tax return of capital..................................... (1,887,292) --
------------ -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (3,633,835) (164,023)
------------ -----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (5,673,992 and 4,102,319
shares, respectively)................................... 71,963,019 43,754,814
Net asset value of shares issued from reinvestment of
distributions (269,330 and 14,099 shares,
respectively)........................................... 3,633,835 164,023
Cost of shares repurchased (1,908,495 and 626,124 shares,
respectively)........................................... (24,401,738) (6,669,881)
------------ -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 51,195,116 37,248,956
------------ -----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 59,973,595 41,860,149
NET ASSETS
Beginning of period....................................... 41,860,149 --
------------ -----------
END OF PERIOD (INCLUDING DISTRIBUTIONS IN EXCESS OF NET
INVESTMENT INCOME OF $0 AND ($4,389), RESPECTIVELY)..... $101,833,744 $41,860,149
============ ===========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM INCEPTION
YEAR ENDED 3/2/98 TO
12/31/99 12/31/98
----------- ---------------
<S> <C> <C>
Net asset value, beginning of period........................ $11.99 $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.07 0.05
Net realized and unrealized gain (loss)................... 1.97 1.99
------ ------
TOTAL FROM INVESTMENT OPERATIONS........................ 2.04 2.04
------ ------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.07) (0.05)
Dividends from net realized gains......................... (0.11) --
In excess of net realized gains........................... (0.05) --
Tax return of capital..................................... (0.27) --
------ ------
TOTAL DISTRIBUTIONS..................................... (0.50) (0.05)
------ ------
CHANGE IN NET ASSET VALUE................................... 1.54 1.99
------ ------
NET ASSET VALUE, END OF PERIOD.............................. $13.53 $11.99
====== ======
Total return................................................ 17.00% 20.45%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $101,834 $41,860
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3)..................................... 0.85% 0.85%(1)
Net investment income..................................... 0.71% 1.02%(1)
Portfolio turnover rate..................................... 52% 81%(2)
</TABLE>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 1.01% and
1.46% for the periods ended December 31, 1999 and 1998, respectively.
See Notes to Financial Statements
51
<PAGE>
PHOENIX-OAKHURST STRATEGIC ALLOCATION SERIES
INVESTOR PROFILE
The Fund is appropriate for investors seeking long-term capital
appreciation, current income, and conservation of capital from a balanced
portfolio of stocks, bonds, and cash equivalents. Investors should note that the
Fund may hold foreign bonds, and foreign investments pose additional risk, such
as currency fluctuation, less public disclosure, and political and economic
uncertainty.
INVESTMENT ADVISOR'S REPORT
From December 31, 1998 to December 31, 1999, the market represented by the
large-cap S&P 500 Index(1) returned a total of 21.14%. This represented the
fifth year in a row that S&P 500 had returned 20% or more. With global economy
recovering in a low inflationary environment, corporate earnings accelerated at
the same time market valuation expanded.
For the 12 months ended December 31, 1999, the Fund returned 11.26% compared
with a return of 11.55% for a composite benchmark index comprised of 55% of the
return of the S&P 500 Index, 35% of the return for the Lehman Brothers Aggregate
Index(2), and 10% of the return for the Salomon Brothers 90-day T-bill(3). The
Fund's return outperformed Lipper Inc.'s flexible portfolio mutual fund index
return of 9.83%, according to Lipper, Inc. All performance figures assume
reinvestment of dividends and exclude the effect of sales charges.
Technology and basic material stocks led market performance during the past
year. Technology issues were propelled by strength in the semiconductor industry
as demand finally caught up with supply due to a dramatic cutback of capacity
spending during 1998. The build-out of Internet infrastructure accelerated the
growth rate of many vendors of communication chips, networking equipment, and
computer servers. With the increasing number of corporations and consumers
populating the World Wide Web, a new class of software tools also emerged. Web
authoring, web-content management, and enterprise procurement management are
just a few of the examples. All of these contributed to the great technology
rally of 1999.
The surge in basic material stocks started earlier in 1999. As the Asian
economic crisis abated, there was great optimism that demand for basic
commodities would stabilize. The OPEC meeting in February rallied the price of
crude oil. The numerous unplanned outages at various chemical plants caused
commodity chemical prices to increase. The protectionism measures contemplated
by Congress curbed steel imports. The strength in the domestic housing market
made forest products scarce. These factors led to increasing earnings forecasts
for many paper, chemical, steel and oil companies. From January through May,
basic material stocks dramatically outperformed the S&P 500 Index.
On the negative side, consumer non-cyclical and health-care stocks
underperformed the market all year. Consumer stocks were hampered by earnings
disappointments from market leaders Coke and Gillette. Many food producers also
failed to meet growth expectations. The drug stocks were slowed by lingering
talk of a Medicare-sponsored prescription benefit plan that may lower the
overall cost of medicine. In addition, major pharmaceutical companies must also
deal with the soon-to-come patent expiration of many blockbuster drugs.
The equity portion of the Fund held a great deal of media stocks. Issues
such as Clear Channel Communication, CBS, AMFM Inc, Liberty Media and Hughes
Electronics all had significantly above-market returns and contributed greatly
to portfolio performance. In the new age of digital media, these companies
either control great distribution or possess great content and have seen their
value rise greatly. The Fund also was helped by holdings in Microsoft, IBM,
America Online, Cisco, Sun Microsystems and Tellabs. These technology companies
are deriving great benefit from the increasing popularity of the Internet.
The Fund was also favorably exposed to several leading specialty retail
stocks, including Home Depot, Wal-Mart Stores and Tandy. Home Depot and Wal-Mart
have increased their dominance in the retail sector, exerting greater influence
on their suppliers and reaping significant benefit from the record high consumer
confidence. Tandy, through the ownership of RadioShack, served as an outlet for
wireless subscription plans, earning great profit in the process. Selected
financial service stocks also performed well. The portfolio held large positions
in Morgan Stanley, Citigroup, and American International Group, which all
appreciated greatly during the year.
At the time of this writing, the bond market is definitely not a repeat of
last year. We saw Russia default, hedge funds unwind around the world, a global
liquidity crisis erupt, and a Fed response of lowering interest rates. Now we
are experiencing a record supply of issues in non-Treasury sectors, Y2K fears, a
reduced role for Wall Street as a market liquidity provider, and a Fed bias
toward higher rates.
(1) The S&P 500 Index is an unmanaged, commonly used measure of stock market
total return performance. The Index is not available for direct investment.
(2) The Lehman Brothers Aggregate Index is an unmanaged, commonly used measure
of broad bond market total return performance. The indices are not available
for direct investment.
(3) The Salomon Brothers 90-day T-bill is a commonly used measure of short-term
debt total return performance.
52
<PAGE>
PHOENIX-OAKHURST STRATEGIC ALLOCATION SERIES
The bond portion of the Fund also performed well in this environment, with
higher-yielding sectors being among the best performers in the market. We have
maintained our strategy of investing in sectors with best relative values, and
while this hurt performance last year, this has benefited results this year.
Some of the best contributors to performance were our holdings in the cable and
telecommunications industries.
OUTLOOK
The outlook for corporate profit has never been better. The global economic
recovery has brightened the earnings picture of many cyclical industries
including energy, paper, aluminum and chemical. With consumers' rapid acceptance
of the Internet, the build out of broadband and wireless infrastructure has been
accelerated. This should ensure another year of buoyant profit for leading
networking and computer companies. The global semiconductor industry is also in
the early stage of a multiyear up cycle. Demand for leading edge process exceeds
available supply. With both margin and pricing strong, the semiconductor
industry should post strong profitability.
A strong global economy naturally brings fear of inflationary pressure. It
is now the consensus view that the Federal Reserve will be raising interest
rates during 2000. Given already high equity valuation today, rising interest
rates will limit further multiple expansion. However, a strong profit outlook
should also mitigate any downside to equity price.
We also believe the outlook for the fixed-income markets is very favorable
for the long term. Real yields remain attractive by historical standards, and
all spread sectors now offer excellent value relative to long-term averages. Our
current focus is on Europe to take advantage of inefficiencies we are finding
there and using currency hedges to pick up incremental yield.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
STRATEGIC BALANCED LIPPER ANALYTICAL SERVICES
ALLOCATION SERIES BENCHMARK * FLEXIBLE PORTFOLIO INDEX **
<S> <C> <C> <C>
12/31/1989 $10,000.00 $10,000.00 $10,000.00
12/31/1990 $10,575.00 $10,230.07 $10,093.63
12/31/1991 $13,667.03 $12,579.76 $12,816.78
12/31/1992 $15,125.16 $13,489.75 $13,543.79
12/31/1993 $16,792.72 $14,737.07 $15,269.81
12/31/1994 $16,549.84 $14,765.35 $14,862.49
12/31/1995 $19,565.51 $18,785.71 $18,368.96
12/31/1996 $21,335.48 $21,478.55 $20,949.97
12/31/1997 $25,757.82 $26,193.47 $24,884.91
12/31/1998 $31,113.87 $31,345.03 $29,003.44
12/31/1999 $34,617.82 $34,965.97 $31,855.35
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C> <C>
1 YEAR 5 YEARS 10 YEARS
- -------------------------------------------------------------------------------------------
Strategic Allocation Series 11.26% 15.90% 13.22%
- -------------------------------------------------------------------------------------------
Balanced Benchmark* 11.55% 18.82% 13.34%
- -------------------------------------------------------------------------------------------
Lipper Analytical Services Flexible Portfolio
Index** 9.83% 16.47% 12.28%
- -------------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 12/31/89.
Returns shown include the reinvestment of all distributions at net asset value,
and the change in share price for the stated period. Returns indicate past
performance, which is not predictive of future performance. Investment return
and net asset value will fluctuate so that your shares, when redeemed, may be
worth more or less than the original cost. 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 fluctuation and less
public disclosure, as well as economic and political risks.
* The Balanced Benchmark is calculated based upon the performance of the
following indices: 55% S&P 500/35% Lehman Brothers Aggregate Bond Index/10%
90-day Treasury Bills and is produced by Frank Russell Company.
** The Lipper Analytical Services Flexible Portfolio Index is an average of the
largest mutual funds within the flexible portfolio category.
53
<PAGE>
PHOENIX-OAKHURST STRATEGIC ALLOCATION SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- ------- --------------
<S> <C> <C> <C>
U.S. GOVERNMENT SECURITIES--17.3%
U.S. TREASURY BONDS--2.9%
U.S. Treasury Bonds 6.125%,
11/15/27........................ AAA $ 2,300 $ 2,140,591
U.S. Treasury Bonds 5.25%,
11/15/28........................ AAA 2,835 2,335,806
U.S. Treasury Bonds 5.25%,
2/15/29......................... AAA 1,910 1,581,200
U.S. Treasury Bonds 6.125%,
8/15/29......................... AAA 8,000 7,622,281
--------------
13,679,878
--------------
U.S. TREASURY NOTES--14.4%
U.S. Treasury Notes 5.75%,
11/15/00........................ AAA 2,200 2,193,783
U.S. Treasury Notes 5%, 2/28/01... AAA 15,000 14,812,269
U.S. Treasury Notes 6.25%,
6/30/02......................... AAA 1,250 1,249,137
U.S. Treasury Notes 5.75%,
11/30/02........................ AAA 1,630 1,606,411
U.S. Treasury Notes 5.50%,
1/31/03......................... AAA 11,960 11,682,520
U.S. Treasury Notes 5.50%,
2/28/03......................... AAA 7,000 6,829,608
U.S. Treasury Notes 5.75%,
4/30/03......................... AAA 2,500 2,453,959
U.S. Treasury Notes 5.25%,
8/15/03......................... AAA 1,053 1,015,025
U.S. Treasury Notes 4.25%,
11/15/03........................ AAA 4,000 3,714,488
U.S. Treasury Notes 4.75%,
2/15/04......................... AAA 13,250 12,488,125
U.S. Treasury Notes 5.25%,
5/15/04......................... AAA 1,590 1,522,507
U.S. Treasury Notes 5.875%,
11/15/04........................ AAA 650 637,046
U.S. Treasury Notes 4.75%,
11/15/08........................ AAA 7,775 6,858,705
U.S. Treasury Notes 5.50%,
5/15/09......................... AAA 225 209,687
U.S. Treasury Notes 6%, 8/15/09... AAA 1,660 1,608,202
--------------
68,881,472
--------------
TOTAL U.S. GOVERNMENT SECURITIES
(Identified cost $86,023,111)............................ 82,561,350
--------------
AGENCY MORTGAGE-BACKED SECURITIES--1.0%
Freddie Mac 6.625%, 9/15/09....... Aaa(c) 5,000 4,856,250
--------------
TOTAL AGENCY MORTGAGE-BACKED SECURITIES
(Identified cost $4,993,359)............................. 4,856,250
--------------
AGENCY NON MORTGAGE-BACKED SECURITIES--0.2%
Fannie Mae 6.625%, 9/15/09........ Aaa(c) 1,245 1,210,762
--------------
TOTAL AGENCY NON MORTGAGE-BACKED SECURITIES
(Identified cost $1,243,388)............................. 1,210,762
--------------
MUNICIPAL BONDS--4.6%
CALIFORNIA--1.7%
Kern County Pension Obligation
Revenue Taxable 7.26%,
8/15/14......................... AAA 1,500 1,425,000
Long Beach Pension Obligation
Taxable 6.87%, 9/1/06........... AAA 840 814,800
Los Angeles County Metropolitan
Transportation Authority Revenue
Series C 5%, 7/1/23............. AAA 1,400 1,212,750
Pasadena Pension Funding Revenue
Taxable Series A 7.10%,
5/15/10......................... AAA 1,500 1,443,750
San Bernardino County Pension
Obligation Revenue Taxable
6.87%, 8/1/08................... AAA 410 393,087
San Bernardino County Pension
Obligation Revenue Taxable
6.94%, 8/1/09................... AAA 1,110 1,061,437
Sonoma County Pension Obligation
Revenue Taxable 6.625%,
6/1/13.......................... AAA 925 835,969
Ventura County Pension Obligation
Taxable 6.54%, 11/1/05.......... AAA 975 937,219
--------------
8,124,012
--------------
FLORIDA--1.2%
Miami Beach Special Obligation
Revenue Taxable 8.60%, 9/1/21... AAA 3,210 3,362,475
Tampa Solid Waste System Revenue
Taxable Series A 6.33%,
10/1/06......................... AAA 2,160 2,008,800
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- ------- --------------
<S> <C> <C> <C>
FLORIDA--CONTINUED
University of Miami Exchangeable
Revenue Taxable Series A 7.65%,
4/1/20 (e)...................... AAA $ 540 $ 506,925
--------------
5,878,200
--------------
MASSACHUSETTS--0.4%
Massachusetts State Port Authority
Revenue Taxable Series C 6.05%,
7/1/02.......................... AA- 835 815,169
Massachusetts State Turnpike
Authority Metropolitan Highway
System Revenue Series A 5%,
1/1/39.......................... AAA 1,400 1,139,250
--------------
1,954,419
--------------
NEW YORK--0.6%
New York City Municipal Water
Finance Authority Water & Sewer
System Revenue Series B 5%,
6/15/29......................... AAA 1,400 1,165,500
New York State Dormitory Authority
Revenue Taxable 6.90%, 4/1/03... A- 725 713,219
New York State Environmental
Facilities Corp. Revenue Taxable
6.70%, 3/15/08.................. AAA 795 755,250
--------------
2,633,969
--------------
PENNSYLVANIA--0.2%
Philadelphia Authority For
Industrial Development Pension
Funding Retirement Systems
Revenue Taxable Series A 5.79%,
4/15/09......................... AAA 1,300 1,145,625
--------------
TEXAS--0.5%
Texas Water Resources Finance
Authority Revenue 6.62%,
8/15/10......................... AAA 2,265 2,100,787
--------------
TOTAL MUNICIPAL BONDS
(Identified cost $23,067,722)............................ 21,837,012
--------------
ASSET-BACKED SECURITIES--2.9%
AESOP Funding II LLC 97-1A, A2
6.40%, 10/20/03................. Aaa(c) 2,000 1,965,431
AESOP Funding II LLC 98-1, A
6.14%, 5/20/06.................. Aaa(c) 1,410 1,345,803
Capita Equipment Receivables Trust
97-1, B 6.45%, 8/15/02.......... A+ 720 709,985
Discover Card Master Trust I 98-7,
A 5.60%, 5/16/06................ AAA 2,000 1,905,000
Ford Credit Auto Owner Trust 99-B,
A4 5.80%, 6/15/02............... AAA 500 494,668
Green Tree Financial Corp. 96-2,
M1 7.60%, 4/15/27............... AA- 1,075 1,040,720
Honda Auto Lease Trust 99-A, A5
6.65%, 7/15/05.................. AAA 2,000 1,986,250
LB Commercial Conduit Mortgage
Trust 99-C2, A2 7.325%,
9/15/09......................... AAA 1,840 1,812,975
Premier Auto Trust 98-3, B 6.14%,
9/8/04.......................... A+ 500 491,043
Triangle Funding Ltd. 98-2A, 3
8.028%, 10/15/04 (e)............ BBB 2,000 1,986,875
--------------
TOTAL ASSET-BACKED SECURITIES
(Identified cost $13,919,872)............................ 13,738,750
--------------
CORPORATE BONDS--2.0%
BROADCASTING (TELEVISION, RADIO & CABLE)--0.1%
Charter Communications Holdings
LLC 8.625%, 4/1/09.............. B+ 675 626,062
--------------
BUILDING MATERIALS--0.1%
Nortek, Inc. 9.125%, 9/1/07....... B+ 700 679,000
--------------
</TABLE>
See Notes to Financial Statements
54
<PAGE>
PHOENIX-OAKHURST STRATEGIC ALLOCATION SERIES
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- ------- --------------
<S> <C> <C> <C>
COMPUTERS (SOFTWARE & SERVICES)--0.1%
Computer Associates International,
Inc. Series B 6.375%, 4/15/05... BBB+ $ 635 $ 587,375
--------------
ENTERTAINMENT--0.5%
Capitol Records, Inc. 144A 8.375%,
8/15/09 (d)..................... BBB+ 2,500 2,396,875
--------------
HEALTH CARE (HOSPITAL MANAGEMENT)--0.3%
Tenet Healthcare Corp. 8%,
1/15/05......................... BB+ 1,200 1,158,000
--------------
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)--0.1%
Boston Scientific Corp. 6.625%,
3/15/05......................... BBB 710 654,975
--------------
INSURANCE (MULTI-LINE)--0.1%
Willis Corroon Corp. 9%, 2/1/09... B+ 530 442,550
--------------
METALS MINING--0.1%
Level 3 Communications, Inc.
9.125%, 5/1/08.................. B 400 378,000
--------------
PAPER & FOREST PRODUCTS--0.1%
Buckeye Technologies, Inc. 9.25%,
9/15/08......................... BB- 350 357,438
--------------
RETAIL (FOOD CHAINS)--0.1%
Kroger Co. 7.45%, 3/1/08.......... BBB- 650 632,938
--------------
TELECOMMUNICATIONS (LONG DISTANCE)--0.2%
Nextlink Communications, Inc.
10.75%, 11/15/08................ B 900 936,000
--------------
TEXTILES (APPAREL)--0.2%
Collins & Aikman Corp. 11.50%,
4/15/06......................... B 695 688,050
--------------
TRUCKS & PARTS--0.0%
Cummins Engine Co., Inc. 6.45%,
3/1/05.......................... BBB+ 160 149,200
--------------
TOTAL CORPORATE BONDS
(Identified cost $10,258,909)............................ 9,686,463
--------------
NON-AGENCY MORTGAGE-BACKED SECURITIES--4.7%
CS First Boston Mortgage
Securities Corp. 97-C2, A3
6.55%, 11/17/07................. AAA 4,200 3,974,250
DLJ Commercial Mortgage Corp.
99-CG1, A1B 6.46%, 1/10/09...... Aaa(c) 3,000 2,793,750
DLJ Commercial Mortgage Corp.
98-CF2, A1B 6.24%, 11/12/31..... Aaa(c) 4,150 3,820,594
First Union - Lehman Brothers
Commercial Mortgage 97-C1, B
7.43%, 4/18/07.................. Aa(c) 850 827,401
First Union Commercial Mortgage
Trust 99-C1, A2 6.07%,
10/15/08........................ AAA 3,000 2,735,742
G.E. Capital Mortgage Services,
Inc. 96-8, 1M 7.25%, 5/25/26.... AA 240 232,789
LB Commercial Conduit Mortgage
Trust 98-C4, A1B 6.21%,
10/15/08........................ AAA 4,000 3,643,487
Lehman Large Loan 97-LLI, B 6.95%,
3/12/07......................... AA+ 645 613,107
Nationslink Funding Corp. 96-1, B
7.69%, 12/20/05................. AA 450 448,119
Residential Funding Mortgage
Securities I 96-S1, A11 7.10%,
1/25/26......................... AAA 1,500 1,431,562
Residential Funding Mortgage
Securities I 96-S4, M1 7.25%,
2/25/26......................... AA 955 913,946
Securitized Asset Sales, Inc.
93-J, 2B 6.808%, 11/28/23....... AA(c) 878 833,610
--------------
TOTAL NON-AGENCY MORTGAGE-BACKED SECURITIES
(Identified cost $23,419,977)............................ 22,268,357
--------------
FOREIGN GOVERNMENT SECURITIES--4.6%
BULGARIA--0.6%
Repulic of Bulgaria IAB Series PDI
6.50%, 07/28/11 (e)............. B(c) 1,750 1,384,687
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- ------- --------------
<S> <C> <C> <C>
BULGARIA--CONTINUED
Republic of Bulgaria FLIRB Bearer
Series A 2.75%, 7/28/12 (e)..... B(c) $ 1,810 $ 1,307,725
--------------
2,692,412
--------------
COLOMBIA--0.3%
Republic of Colombia 10.875%,
3/9/04.......................... BB+ 1,000 1,027,500
Republic of Colombia 9.75%,
4/23/09......................... BB+ 500 467,500
--------------
1,495,000
--------------
COSTA RICA--0.4%
Republic of Costa Rica 144A
9.335%, 5/15/09 (d)............. BB 1,755 1,785,712
--------------
CROATIA--0.4%
Croatia Series B 6.50%, 7/31/06
(e)............................. BBB- 865 798,369
Croatia Series A 6.50%, 7/31/10
(e)............................. BBB- 1,000 855,000
--------------
1,653,369
--------------
EL SALVADOR--0.4%
Republic of El Salvador 144A
9.50%, 8/15/06 (d).............. BB+ 2,000 1,985,000
--------------
MEXICO--0.8%
United Mexican States Global Bond
11.375%, 9/15/16................ BB 1,250 1,418,750
United Mexican States Global Bond
11.50%, 5/15/26................. BB 2,000 2,392,500
--------------
3,811,250
--------------
PANAMA--0.1%
Republic of Panama 9.375%,
4/1/29.......................... BB+ 500 476,875
--------------
PHILIPPINES--0.4%
Republic of Philippines 8.875%,
4/15/08......................... BB+ 1,750 1,717,188
Republic of Philippines 9.875%,
1/15/19......................... BB+ 250 247,813
--------------
1,965,001
--------------
POLAND--0.7%
Poland Bearer PDI 6%, 10/27/14
(e)............................. BBB 4,000 3,550,000
--------------
SOUTH KOREA--0.4%
Republic of Korea 8.875%,
4/15/08......................... BBB 1,845 1,951,088
--------------
TURKEY--0.1%
Republic of Turkey 12.375%,
6/15/09......................... B 500 539,375
--------------
TOTAL FOREIGN GOVERNMENT SECURITIES
(Identified cost $21,201,227)............................ 21,905,082
--------------
FOREIGN CORPORATE BONDS--0.4%
ARGENTINA--0.1%
Compania de Radiocomunicaciones
Moviles SA 144A 9.25%, 5/8/08
(d)............................. BBB- 450 391,500
--------------
CHILE--0.1%
Compania Sud Americana de Vapores
SA 7.375%, 12/8/03.............. BBB 140 134,908
Petropower I Funding Trust 144A
7.36%, 2/15/14 (d).............. BBB 478 425,502
--------------
560,410
--------------
LUXEMBOURG--0.1%
Tyco International Group SA
6.375%, 6/15/05................. A- 500 466,250
--------------
POLAND--0.1%
TPSA Finance BV 144A 7.75%,
12/10/08 (d).................... BBB 355 331,038
--------------
TOTAL FOREIGN CORPORATE BONDS
(Identified cost $1,914,892)............................. 1,749,198
--------------
</TABLE>
See Notes to Financial Statements
55
<PAGE>
PHOENIX-OAKHURST STRATEGIC ALLOCATION SERIES
<TABLE>
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
COMMON STOCKS--55.4%
BANKS (MAJOR REGIONAL)--2.1%
Mellon Financial Corp....................... 53,400 $ 1,818,937
Wells Fargo Co.............................. 206,000 8,330,125
------------
10,149,062
------------
BANKS (MONEY CENTER)--1.2%
Bank of America Corp........................ 115,074 5,775,276
------------
BEVERAGES (NON-ALCOHOLIC)--1.2%
PepsiCo, Inc................................ 156,000 5,499,000
------------
BROADCASTING (TELEVISION, RADIO & CABLE)--4.5%
AMFM, Inc. (b).............................. 33,000 2,582,250
AT&T Corp.- Liberty Media Group Class A
(b)....................................... 219,200 12,439,600
CBS Corp. (b)............................... 63,300 4,047,244
Clear Channel Communications, Inc. (b)...... 27,600 2,463,300
------------
21,532,394
------------
COMMUNICATIONS EQUIPMENT--2.0%
General Motors Corp. Class H (b)............ 28,900 2,774,400
Motorola, Inc............................... 18,000 2,650,500
Tellabs, Inc. (b)........................... 66,800 4,287,725
------------
9,712,625
------------
COMPUTERS (HARDWARE)--5.0%
Dell Computer Corp. (b)..................... 110,800 5,650,800
International Business Machines Corp........ 86,000 9,288,000
Sun Microsystems, Inc. (b).................. 111,800 8,657,512
------------
23,596,312
------------
COMPUTERS (NETWORKING)--3.1%
Cisco Systems, Inc. (b)..................... 140,000 14,997,500
------------
COMPUTERS (SOFTWARE & SERVICES)--4.5%
America Online, Inc. (b).................... 71,600 5,401,325
Microsoft Corp. (b)......................... 138,600 16,181,550
------------
21,582,875
------------
CONSUMER FINANCE--0.5%
Capital One Financial Corp.................. 50,000 2,409,375
------------
DISTRIBUTORS (FOOD & HEALTH)--0.6%
Cardinal Health, Inc........................ 57,800 2,767,175
------------
ELECTRIC COMPANIES--0.4%
Duke Energy Corp............................ 37,000 1,854,625
------------
ELECTRICAL EQUIPMENT--2.5%
General Electric Co......................... 76,400 11,822,900
------------
ELECTRONICS (INSTRUMENTATION)--0.3%
Waters Corp. (b)............................ 30,000 1,590,000
------------
ELECTRONICS (SEMICONDUCTORS)--2.4%
Intel Corp.................................. 137,400 11,309,738
------------
FINANCIAL (DIVERSIFIED)--4.7%
Citigroup, Inc.............................. 161,375 8,966,398
Freddie Mac................................. 59,800 2,814,338
Morgan Stanley Dean Witter & Co............. 75,900 10,834,725
------------
22,615,461
------------
HEALTH CARE (DIVERSIFIED)--1.5%
American Home Products Corp................. 26,400 1,041,150
Bristol-Myers Squibb Co..................... 98,000 6,290,375
------------
7,331,525
------------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--1.8%
Pfizer, Inc................................. 134,300 4,356,356
Schering-Plough Corp........................ 102,400 4,320,000
------------
8,676,356
------------
<CAPTION>
SHARES VALUE
----------- ------------
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)--1.2%
<S> <C> <C> <C>
Bard (C.R.), Inc............................ 31,000 $ 1,643,000
Baxter International, Inc................... 61,800 3,881,813
------------
5,524,813
------------
HOUSEHOLD PRODUCTS (NON-DURABLE)--1.8%
Fort James Corp............................. 14,400 394,200
Kimberly-Clark Corp......................... 16,000 1,044,000
Procter & Gamble Co. (The).................. 66,000 7,231,125
------------
8,669,325
------------
INSURANCE (MULTI-LINE)--1.5%
American International Group, Inc........... 64,562 6,980,766
------------
LODGING-HOTELS--0.7%
Carnival Corp............................... 66,200 3,165,188
------------
MANUFACTURING (DIVERSIFIED)--1.6%
Tyco International Ltd...................... 198,800 7,728,350
------------
OIL & GAS (DRILLING & EQUIPMENT)--0.9%
Halliburton Co.............................. 37,200 1,497,300
Schlumberger Ltd............................ 24,500 1,378,125
Transocean Sedco Forex, Inc................. 34,743 1,170,405
------------
4,045,830
------------
OIL & GAS (EXPLORATION & PRODUCTION)--0.5%
Anadarko Petroleum Corp..................... 67,000 2,286,375
------------
OIL (DOMESTIC INTEGRATED)--0.6%
Conoco, Inc. Class A........................ 116,000 2,871,000
------------
PAPER & FOREST PRODUCTS--0.2%
Georgia-Pacific Group....................... 5,500 279,125
International Paper Co...................... 14,000 790,125
------------
1,069,250
------------
RETAIL (BUILDING SUPPLIES)--1.5%
Home Depot, Inc. (The)...................... 105,150 7,209,347
------------
RETAIL (COMPUTERS & ELECTRONICS)--0.3%
Tandy Corp.................................. 26,400 1,298,550
------------
RETAIL (FOOD CHAINS)--0.3%
Safeway, Inc. (b)........................... 38,500 1,369,156
------------
RETAIL (GENERAL MERCHANDISE)--2.2%
Wal-Mart Stores, Inc........................ 152,300 10,527,738
------------
RETAIL (SPECIALTY)--0.4%
Staples, Inc. (b)........................... 98,400 2,041,800
------------
TELECOMMUNICATIONS (LONG DISTANCE)--2.5%
AT&T Corp................................... 128,160 6,504,120
MCI WorldCom, Inc. (b)...................... 98,307 5,216,415
------------
11,720,535
------------
TELEPHONE--0.8%
SBC Communications, Inc..................... 82,400 4,017,000
------------
TEXTILES (APPAREL)--0.1%
Tommy Hilfiger Corp. (b).................... 16,000 373,000
------------
TOTAL COMMON STOCKS
(Identified cost $172,092,980)............................ 264,120,222
------------
FOREIGN COMMON STOCKS--3.5%
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--0.5%
Elan Corp. PLC Sponsored ADR (Ireland)
(b)....................................... 72,400 2,135,800
------------
OIL (INTERNATIONAL INTEGRATED)--1.8%
BP Amoco PLC Sponsored ADR (United
Kingdom).................................. 147,132 8,726,767
------------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--1.2%
Vodafone AirTouch PLC Sponsored ADR (United
Kingdom).................................. 118,250 5,853,375
------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $10,702,610)............................. 16,715,942
------------
</TABLE>
See Notes to Financial Statements
56
<PAGE>
PHOENIX-OAKHURST STRATEGIC ALLOCATION SERIES
<TABLE>
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
UNIT INVESTMENT TRUSTS--1.3%
S&P 500 Depository Receipts................. 41,600 $ 6,110,000
------------
TOTAL UNIT INVESTMENT TRUSTS
(Identified cost $5,465,926).............................. 6,110,000
------------
WARRANTS--0.0%
FOREIGN GOVERNMENT--0.0%
Republic of Argentina Warrants (Argentina)
(b)....................................... 1,118 2,376
------------
TOTAL WARRANTS
(Identified cost $0)...................................... 2,376
------------
TOTAL LONG-TERM INVESTMENTS--97.9%
(Identified cost $374,303,973)............................ 466,761,764
------------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- ------ ------------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--1.6%
COMMERCIAL PAPER--1.0%
Ford Motor Credit Co. 4.79%,
1/7/00............................. A-1+ $4,470 $ 4,466,431
------------
FEDERAL AGENCY SECURITIES--0.1%
Fannie Mae Discount Note 5.75%,
1/20/00............................ 155 154,530
Fannie Mae Discount Note 5.75%,
1/24/00............................ 371 369,637
------------
524,167
------------
FEDERAL AGENCY SECURITIES--VARIABLE--0.5%
FNMA (final maturity 2/24/00)........ 2,500 2,479,225
------------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $7,469,823)............................... 7,469,823
------------
TOTAL INVESTMENTS--99.5%
(Identified cost $381,773,796)............................. 474,231,587(a)
Cash and receivables, less liabilities--0.5%............... 2,476,930
------------
NET ASSETS--100.0%........................................... $476,708,517
============
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $103,840,890 and gross depreciation of $12,051,984 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purposes
was $382,442,681.
(b) Non-income producing.
(c) As rated by Moody's, Fitch or Duff & Phelps.
(d) 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 December 31, 1999, these securities
amounted to a value of $7,315,627 or 1.50% of net assets.
(e) Variable or step coupon security; interest rate shown
reflects the rate currently in effect.
</TABLE>
See Notes to Financial Statements
57
<PAGE>
PHOENIX-OAKHURST STRATEGIC ALLOCATION SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$381,773,796)............................................. $474,231,587
Cash........................................................ 4,175
Receivables
Interest and dividends.................................... 3,099,575
Fund shares sold.......................................... 61,091
Prepaid expenses............................................ 7,242
------------
Total assets............................................ 477,403,670
------------
LIABILITIES
Payables
Fund shares repurchased................................... 282,459
Investment advisory fee................................... 230,786
Financial agent fee....................................... 19,635
Trustees' fee............................................. 6,958
Accrued expenses............................................ 155,315
------------
Total liabilities....................................... 695,153
------------
NET ASSETS.................................................. $476,708,517
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $378,797,759
Undistributed net investment income....................... 510,785
Accumulated net realized gain............................. 4,942,182
Net unrealized appreciation............................... 92,457,791
------------
NET ASSETS.................................................. $476,708,517
============
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 29,457,670
============
Net asset value and offering price per share................ $ 16.18
============
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $11,556,272
Dividends................................................. 2,224,406
Foreign taxes withheld.................................... (19,567)
-----------
Total investment income................................. 13,761,111
-----------
EXPENSES
Investment advisory fee................................... 2,726,792
Financial agent fee....................................... 317,859
Custodian................................................. 94,569
Printing.................................................. 92,357
Professional.............................................. 36,920
Trustees.................................................. 16,286
Miscellaneous............................................. 26,088
-----------
Total expenses.......................................... 3,310,871
-----------
NET INVESTMENT INCOME....................................... 10,450,240
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 25,038,426
Net change in unrealized appreciation (depreciation) on
investments............................................. 14,475,995
-----------
NET GAIN ON INVESTMENTS..................................... 39,514,421
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $49,964,661
===========
</TABLE>
See Notes to Financial Statements
58
<PAGE>
PHOENIX-OAKHURST STRATEGIC ALLOCATION SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
------------ -------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 10,450,240 $ 8,822,688
Net realized gain (loss).................................. 25,038,426 19,330,598
Net change in unrealized appreciation (depreciation)...... 14,475,995 57,110,856
------------ ------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 49,964,661 85,264,142
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (10,436,738) (8,371,532)
Net realized gains........................................ (23,588,155) (31,140,159)
------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (34,024,893) (39,511,691)
------------ ------------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (2,823,884 and 3,651,580
shares, respectively)................................... 44,863,751 52,916,356
Net asset value of shares issued from reinvestment of
distributions(2,122,394 and 2,607,238 shares,
respectively)........................................... 34,024,893 39,511,691
Cost of shares repurchased (6,225,713 and 5,904,172
shares, respectively)................................... (99,016,572) (86,285,937)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ (20,127,928) 6,142,110
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS..................... (4,188,160) 51,894,561
NET ASSETS
Beginning of period....................................... 480,896,677 429,002,116
------------ ------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $510,785 AND $487,041, RESPECTIVELY)... $476,708,517 $480,896,677
============ ============
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1999 1998 1997 1996 1995
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period........................ $15.65 $14.12 $13.65 $13.63 $12.68
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.36 0.29 0.32 0.32 0.45
Net realized and unrealized gain (loss)................... 1.36 2.57 2.46 0.91 1.84
------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS........................ 1.72 2.86 2.78 1.23 2.29
------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.36) (0.28) (0.33) (0.31) (0.45)
Dividends from net realized gains......................... (0.83) (1.05) (1.98) (0.90) (0.89)
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS..................................... (1.19) (1.33) (2.31) (1.21) (1.34)
------ ------ ------ ------ ------
CHANGE IN NET ASSET VALUE................................... 0.53 1.53 0.47 0.02 0.95
------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD.............................. $16.18 $15.65 $14.12 $13.65 $13.63
====== ====== ====== ====== ======
Total return................................................ 11.26% 20.79% 20.73% 9.05% 18.22%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $476,709 $480,897 $429,002 $374,244 $353,838
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses........................................ 0.70% 0.68% 0.71% 0.70% 0.67%(1)
Net investment income..................................... 2.21% 1.97% 2.09% 2.26% 3.28%
Portfolio turnover rate..................................... 65% 139% 368% 287% 170%
</TABLE>
(1) The ratio of operating expenses to average net assets excludes the effect of
expense offsets for custodian fees; if expense offsets were included, the
ratio would not significantly differ.
See Notes to Financial Statements
59
<PAGE>
PHOENIX-SENECA MID-CAP GROWTH SERIES
INVESTMENT OBJECTIVE
The Phoenix-Seneca Mid Cap Growth Series is appropriate for investors
seeking long-term capital appreciation. The Fund primarily invests in companies
with small- to mid-size capitalizations, and investors should note that
small-company investing involves added risks, including greater price
volatility, less liquidity, and increased competitive threat.
INVESTMENT ADVISER'S REPORT
For the year ended December 31, 1999, the Fund returned 45.62% compared with
a return of 14.72% for our benchmark, the S&P MidCap 400 Index(1). Investors
should consider all performance periods and the effect of the past 12 months'
strong stock market when evaluating funds. All performance figures assume
reinvestment of dividends and are net of sales charges.
The portfolio suffered in the first quarter of the year as the market was
led by such stocks as Charles Schwab and Yahoo!, which we were precluded from
owning in the portfolio due to their large size and high valuations. In
addition, earnings disappointments in several technology holdings were
responsible for disappointing performance during the quarter.
Performance was also negatively impacted by our health-care holdings as
Centocor, Elan, Mylan Labs, and Omnicare turned in disappointing results in the
first half. In most cases, fundamentals were less of a problem than negative
investor sentiment. By the end of the second quarter, we had sold off all of our
health-care positions. During the negative third quarter, our portfolio risk
controls, primarily our valuation discipline, helped the portfolio outperform on
a relative basis.
An emphasis on technology stocks, whose overweighting increased throughout
the year, and positive stock selection across several sectors were responsible
for our significant outperformance in the fourth quarter. Stocks such as Applied
Microcircuits, E-Tek Dynamic, and SDL, Inc. produced 100%+ returns. Stock
selection within the health-care and energy sectors also helped performance. Our
only health-care holding, MedImmune, was one of the top-performing stocks. In
addition, our energy holdings were in the drilling and oil field equipment
industries and outperformed on a relative basis.
OUTLOOK
We believe interest rates will continue to rise in 2000 as the Federal
Reserve does battle with the economy, but this upward bias should end by
midyear, when we expect to see a concrete slowing of the economy. Thus, the
first part of the year will probably be difficult for both stocks and bonds.
Equities should fare better in the second half, with the S&P's return closer to
10%, rather than the 20%+ to which investor have become accustomed. With little
to no multiple expansion likely, stocks will have to trade on earnings, which
should come in somewhere between 8-12% for the S&P. We also expect the
bifurcation of growth and value stocks to persist, which will cause market
breadth to remain poor.
We believe many exciting growth stories will continue to come from the
technology sector and, therefore, expect the portfolio to remain overweighted in
this area. However, we will continue to explore growth elsewhere as well.
Sectors such as consumer staples, an area with some interesting growth stories
and attractive valuations, and oil services, which should see good growth due to
improved global GDP, may offer significant growth opportunities in 2000.
(1) The S&P MidCap 400 Index is an unmanaged, commonly used measure of mid-cap
stock total return performance. The Index is not available for direct
investment.
60
<PAGE>
PHOENIX-SENECA MID-CAP GROWTH SERIES
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
MID-CAP GROWTH SERIES S&P MIDCAP 400 INDEX(1)
<S> <C> <C>
3/2/98 $10,000.00 $10,000.00
12/31/98 $12,175.09 $11,220.92
12/31/99 $17,728.97 $12,872.76
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C>
FROM
INCEPTION
3/2/98 TO
1 YEAR 12/31/99
- --------------------------------------------------------------------------------------
Mid-Cap Growth Series 45.62% 36.67%
- --------------------------------------------------------------------------------------
S&P MidCap 400 Index(1) 14.72% 14.77%
- --------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 3/2/98.
Returns shown include the reinvestment of all distributions at net asset value,
and the change in share price for the stated period. Returns indicate past
performance, which is not predictive of future performance. Investment return
and net asset value will fluctuate so that your shares, when redeemed, may be
worth more or less than the original cost. Foreign investing involves special
risks such as currency fluctuation and less public disclosure, as well as
economic and political risks.
(1) The S&P MidCap 400 Index is an unmanaged, commonly used measure of total
return performance of mid-capitalization companies. The Index is not
available for direct investment.
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
------- -----------
<S> <C> <C> <C>
COMMON STOCKS--91.6%
BANKS (MAJOR REGIONAL)--2.3%
Comerica, Inc................................... 10,955 $ 511,462
-----------
BANKS (REGIONAL)--3.2%
UnionBanCal Corp................................ 17,580 693,311
-----------
BIOTECHNOLOGY--3.9%
MedImmune, Inc. (b)............................. 5,090 844,304
-----------
BROADCASTING (TELEVISION, RADIO & CABLE)--9.8%
AMFM, Inc. (b).................................. 9,030 706,597
Adelphia Communications Corp. Class A (b)....... 9,770 641,156
EchoStar Communications Corp. (b)............... 7,180 700,050
Spanish Broadcasting System, Inc. Class A (b)... 2,620 105,455
-----------
2,153,258
-----------
COMMUNICATIONS EQUIPMENT--8.1%
American Tower Corp. Class A (b)................ 19,700 602,081
Comverse Technology, Inc. (b)................... 4,685 678,154
Scientific-Atlanta, Inc......................... 8,940 497,287
-----------
1,777,522
-----------
COMPUTERS (HARDWARE)--6.0%
Copper Mountain Networks, Inc. (b).............. 10,380 506,025
Extreme Networks, Inc. (b)...................... 9,540 $ 796,590
-----------
1,302,615
-----------
<CAPTION>
SHARES VALUE
------- -----------
<S> <C> <C> <C>
COMPUTERS (SOFTWARE & SERVICES)--5.2%
VERITAS Software Corp. (b)...................... 4,980 712,762
Vignette Corp. (b).............................. 2,670 435,210
-----------
1,147,972
-----------
ELECTRICAL EQUIPMENT--4.1%
SPX Corp. (b)................................... 7,820 631,954
Universal Electronics, Inc. (b)................. 5,790 266,340
-----------
898,294
-----------
ELECTRONICS (SEMICONDUCTORS)--23.4%
Applied Micro Circuits Corp. (b)................ 5,990 762,227
E-Tek Dynamics, Inc. (b)........................ 6,220 837,368
Fairchild Semiconductor Corp. (b)............... 19,170 570,308
LSI Logic Corp. (b)............................. 11,470 774,225
PMC-Sierra, Inc. (b)............................ 5,580 894,544
SDL, Inc. (b)................................... 2,830 616,940
Xilinx, Inc. (b)................................ 14,360 652,931
-----------
5,108,543
-----------
EQUIPMENT (SEMICONDUCTOR)--4.0%
KLA-Tencor Corp. (b)............................ 7,810 869,839
-----------
</TABLE>
See Notes to Financial Statements
61
<PAGE>
PHOENIX-SENECA MID-CAP GROWTH SERIES
<TABLE>
<CAPTION>
SHARES VALUE
------- -----------
INSURANCE (PROPERTY-CASUALTY)--2.4%
<S> <C> <C> <C>
MGIC Investment Corp............................ 8,730 $ 525,437
-----------
OIL & GAS (DRILLING & EQUIPMENT)--7.2%
Nabors Industries, Inc. (b)..................... 25,400 785,813
Weatherford International, Inc. (b)............. 19,470 777,583
-----------
1,563,396
-----------
PAPER & FOREST PRODUCTS--5.3%
Mead Corp. (The)................................ 14,410 625,934
Smurfit-Stone Container Corp. (b)............... 21,590 528,955
-----------
1,154,889
-----------
SERVICES (COMMERCIAL & CONSUMER)--4.8%
Convergys Corp.................................. 17,350 533,513
Crown Castle International Corp. (b)............ 16,270 522,674
-----------
1,056,187
-----------
SERVICES (DATA PROCESSING)--1.9%
Concord EFS, Inc. (b)........................... 16,300 419,725
-----------
TOTAL COMMON STOCKS
(Identified cost $14,669,307)............................. 20,026,754
-----------
FOREIGN COMMON STOCKS--3.5%
BROADCASTING (TELEVISION, RADIO & CABLE)--1.5%
NDS Group PLC Sponsored ADR (United Kingdom)
(b)........................................... 10,790 329,095
-----------
EQUIPMENT (SEMICONDUCTOR)--2.0%
Chartered Semiconductor Manufacturing Ltd. ADR
(Singapore)................................... 6,010 438,730
-----------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $587,177)................................ 767,825
-----------
TOTAL LONG-TERM INVESTMENTS--95.1%
(Identified cost $15,256,484)............................. 20,794,579
-----------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- -----------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--7.9%
COMMERCIAL PAPER--4.0%
Koch Industries, Inc. 7.50%, 1/3/00... A-1+ $865 $ 864,640
-----------
FEDERAL AGENCY SECURITIES--3.9%
Freddie Mac Discount Note 1.28%,
1/3/00.............................. 850 849,939
-----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $1,714,579).................................. 1,714,579
-----------
TOTAL INVESTMENTS--103.0%
(Identified cost $16,971,063)................................. 22,509,158(a)
Cash and receivables, less liabilities--(3.0%)................ (652,281)
-----------
NET ASSETS--100.0%.............................................. $21,856,877
===========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $5,713,427 and gross depreciation of $176,955 for federal
income tax purposes. At December 31, 1999, the aggregate
cost of securities for federal income tax purposes was
$16,972,686.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
62
<PAGE>
PHOENIX-SENECA MID-CAP GROWTH SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$16,971,063).............................................. $22,509,158
Cash........................................................ 4,488
Receivables
Investment securities sold................................ 321,184
Fund shares sold.......................................... 165,373
Interest and dividends.................................... 6,754
Receivable from advisor................................... 2,163
Prepaid expenses............................................ 110
-----------
Total assets............................................ 23,009,230
-----------
LIABILITIES
Payables
Investment securities purchased........................... 1,086,687
Fund shares repurchased................................... 9,246
Trustees' fee............................................. 6,958
Financial agent fee....................................... 5,952
Accrued expenses............................................ 43,510
-----------
Total liabilities....................................... 1,152,353
-----------
NET ASSETS.................................................. $21,856,877
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $14,915,035
Accumulated net realized gain............................. 1,403,747
Net unrealized appreciation............................... 5,538,095
-----------
NET ASSETS.................................................. $21,856,877
===========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 1,264,840
===========
Net asset value and offering price per share................ $ 17.28
===========
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $ 45,932
Dividends................................................. 33,775
----------
Total investment income................................. 79,707
----------
EXPENSES
Investment advisory fee................................... 88,936
Financial agent fee....................................... 57,539
Printing.................................................. 21,246
Professional.............................................. 18,293
Custodian................................................. 16,945
Trustees.................................................. 16,302
Miscellaneous............................................. 7,243
----------
Total expenses.......................................... 226,504
Less expense borne by investment adviser................ (109,771)
----------
Net expenses............................................ 116,733
----------
NET INVESTMENT INCOME....................................... (37,026)
----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 2,130,838
Net change in unrealized appreciation (depreciation) on
investments............................................. 4,123,355
----------
NET GAIN ON INVESTMENTS..................................... 6,254,193
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $6,217,167
==========
</TABLE>
See Notes to Financial Statements
63
<PAGE>
PHOENIX-SENECA MID-CAP GROWTH SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
YEAR ENDED 3/2/98 TO
12/31/99 12/31/98
----------- -------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ (37,026) $ 5,783
Net realized gain (loss).................................. 2,130,838 (172,597)
Net change in unrealized appreciation (depreciation)...... 4,123,355 1,414,740
----------- -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 6,217,167 1,247,926
----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... -- (5,783)
Net realized gains........................................ (517,468) (697)
----------- -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (517,468) (6,480)
----------- -----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (937,074 and 958,184
shares)................................................. 12,531,550 9,826,161
Net asset value of shares issued from reinvestment of
distributions (30,619 and 557 shares)................... 517,469 6,480
Cost of shares repurchased (352,061 and 309,533
shares)................................................. (4,788,985) (3,176,943)
----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 8,260,034 6,655,698
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 13,959,733 7,897,144
NET ASSETS
Beginning of period....................................... 7,897,144 --
----------- -----------
END OF PERIOD (INCLUDING DISTRIBUTIONS IN EXCESS OF NET
INVESTMENT INCOME OF $0 AND ($697), RESPECTIVELY)....... $21,856,877 $ 7,897,144
=========== ===========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM INCEPTION
YEAR ENDED 3/2/98 TO
12/31/99 12/31/98
----------- ---------------
<S> <C> <C>
Net asset value, beginning of period........................ $12.16 $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. --(4) 0.01(4)
Net realized and unrealized gain (loss)................... 5.54 2.16
------ ------
TOTAL FROM INVESTMENT OPERATIONS........................ 5.54 2.17
------ ------
LESS DISTRIBUTIONS
Dividends from net investment income...................... -- (0.01)
Dividents from net realized gains......................... (0.42) --
------ ------
TOTAL DISTRIBUTIONS..................................... (0.42) (0.01)
------ ------
CHANGE IN NET ASSET VALUE................................... 5.12 2.16
------ ------
NET ASSET VALUE, END OF PERIOD.............................. $17.28 $12.16
====== ======
Total return................................................ 45.62% 21.75%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $21,857 $7,897
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses (3).................................... 1.05% 1.05%(1)
Net investment income (loss).............................. (0.33)% 0.15%(1)
Portfolio turnover rate..................................... 169% 127%(2)
</TABLE>
<TABLE>
<C> <S>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed
expenses, the ratio of operating expenses to average net
assets would have been 2.04% and 2.82% for the periods ended
December 31, 1999 and 1998, respectively.
(4) Computed using average shares outstanding.
</TABLE>
See Notes to Financial Statements
64
<PAGE>
PHOENIX-SENECA STRATEGIC THEME SERIES
INVESTMENT OBJECTIVE
The Fund seeks long-term capital appreciation through investments in common
stocks.
INVESTMENT ADVISER'S REPORT
The Fund had very good results, returning 54.98% compared with a return of
21.14% for the S&P 500 Index.** All performance figures assume reinvestment of
distributions and are net of sales charges. Investors should consider all
performance periods and the effect of the past 12 months' strong stock market
when evaluating funds.
Technology was definitely the hands-down winning sector of the year. Our
portfolio was overweighted in this sector over the course of 1999. It is worth
noting that we did not own some of the top performers in the S&P 500 due to
valuation concerns. Rather, the portfolio management team focused on selecting
companies that we believe had superior earnings momentum. Wireless digital data
communications was one of our "themes" that produced winners, such as EchoStar,
Nokia, and Nortel, some of the Fund's best performers for the year. While many
exciting growth stories will continue to come from the technology sector and,
therefore, the portfolio will probably remain overweighted in this area, we will
also continue to explore growth elsewhere. For example, within the financial
sector, Morgan Stanley Dean Witter, one of our top holdings, produced
technology-like returns.
OUTLOOK
We believe interest rates will continue to rise in 2000 as the Federal
Reserve does battle with the economy, but this upward bias should end by
midyear, when we expect to see a concrete slowing of the economy. Thus, the
first part of the year will probably be difficult for both stocks and bonds.
Equities should fare better in the second half, with the S&P's return closer to
10%, rather than the 20%+ to which investor have become accustomed. With little
to no multiple expansion likely, stocks will have to trade on earnings, which
should come in somewhere between 8-12% for the S&P. We also expect the
bifurcation of growth and value stocks to persist, which will cause market
breadth to remain poor.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
STRATEGIC THEME SERIES S & P MIDCAP 400 INDEX* S & P 500 INDEX**
<S> <C> <C> <C>
1/29/1996 $10,000.00 $10,000.00 $10,000.00
12/31/1996 $11,032.99 $11,959.38 $12,144.20
12/31/1997 $12,926.76 $15,818.21 $16,197.39
12/31/1998 $18,703.89 $18,841.30 $20,855.20
12/31/1999 $28,986.63 $21,614.95 $25,262.96
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C>
FROM
INCEPTION
1/29/96
TO
1 YEAR 12/31/99
- --------------------------------------------------------------------------------------
Strategic Theme Series 54.98% 31.16%
- --------------------------------------------------------------------------------------
S&P Midcap 400 Index* 14.72% 21.71%
- --------------------------------------------------------------------------------------
S&P 500 Index** 21.14% 26.65%
- --------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 1/29/96
(inception of the Fund). Returns shown include the reinvestment of all
distributions at net asset value, and the change in share price for the stated
period. Returns indicate past performance, which is not predictive of future
performance. Investment return and net asset value will fluctuate so that your
shares, when redeemed, may be worth more or less than the original cost. Foreign
investing involves special risks such as currency fluctuation and less public
disclosure, as well as economic and political risks.
* The S&P MidCap 400 Index is an unmanaged index composed of companies with
market capitalizations between $300 million and $5 billion.
** The S&P 500 Index is an unmanaged, commonly used measure of stock total
return performance. The Index is not available for direct investment.
65
<PAGE>
PHOENIX-SENECA STRATEGIC THEME SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
COMMON STOCKS--83.1%
BROADCASTING (TELEVISION, RADIO & CABLE)--7.2%
AMFM, Inc. (b).............................. 42,500 $ 3,325,625
EchoStar Communications Corp. (b)........... 96,800 9,438,000
------------
12,763,625
------------
CHEMICALS--3.0%
Dow Chemical Co. (The)...................... 40,400 5,398,450
------------
COMMUNICATIONS EQUIPMENT--9.5%
General Motors Corp. Class H (b)............ 86,000 8,256,000
Motorola, Inc............................... 58,000 8,540,500
------------
16,796,500
------------
COMPUTERS (HARDWARE)--8.4%
Extreme Networks, Inc. (b).................. 58,050 4,847,175
Sun Microsystems, Inc. (b).................. 130,000 10,066,875
------------
14,914,050
------------
COMPUTERS (SOFTWARE & SERVICES)--3.3%
Microsoft Corp. (b)......................... 49,400 5,767,450
------------
ELECTRICAL EQUIPMENT--2.8%
General Electric Co......................... 32,300 4,998,425
------------
ELECTRONICS (SEMICONDUCTORS)--13.6%
Analog Devices, Inc. (b).................... 74,000 6,882,000
Intel Corp.................................. 42,700 3,514,744
LSI Logic Corp. (b)......................... 93,020 6,278,850
Texas Instruments, Inc...................... 76,240 7,385,750
------------
24,061,344
------------
EQUIPMENT (SEMICONDUCTOR)--8.9%
Applied Materials, Inc. (b)................. 70,900 8,982,144
Teradyne, Inc. (b).......................... 103,200 6,811,200
------------
15,793,344
------------
FINANCIAL (DIVERSIFIED)--6.0%
Citigroup, Inc.............................. 73,430 4,079,954
Morgan Stanley Dean Witter & Co............. 46,100 6,580,775
------------
10,660,729
------------
HEALTH CARE (DIVERSIFIED)--2.2%
Johnson & Johnson........................... 42,700 3,976,437
------------
MANUFACTURING (DIVERSIFIED)--3.7%
Corning, Inc................................ 50,400 6,498,450
------------
OIL & GAS (DRILLING & EQUIPMENT)--3.3%
Halliburton Co.............................. 145,300 5,848,325
------------
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
RETAIL (BUILDING SUPPLIES)--1.2%
Home Depot, Inc. (The)...................... 30,000 $ 2,056,875
------------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--7.4%
Nextel Communications, Inc. Class A (b)..... 69,000 7,115,625
Sprint Corp. (PCS Group) (b)................ 58,000 5,945,000
------------
13,060,625
------------
TELECOMMUNICATIONS (LONG DISTANCE)--2.6%
MCI WorldCom, Inc. (b)...................... 88,200 4,680,113
------------
TOTAL COMMON STOCKS
(Identified cost $100,205,264)............................ 147,274,742
------------
FOREIGN COMMON STOCKS--11.3%
COMMUNICATIONS EQUIPMENT--11.3%
Nokia Oyj Sponsored ADR (Finland)........... 57,520 10,928,800
Nortel Networks Corp. (Canada).............. 90,000 9,090,000
------------
20,018,800
------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $9,312,687).............................. 20,018,800
------------
TOTAL LONG-TERM INVESTMENTS--94.4%
(Identified cost $109,517,951)............................ 167,293,542
------------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000)
----------- --------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--8.3%
COMMERCIAL PAPER--7.4%
Koch Industries, Inc. 4.50%,
1/3/00............................. A-1+ $6,960 6,958,260
Pitney Bowes, Inc. 6.60%, 1/4/00..... A-1+ 2,500 2,498,625
Ford Motor Credit Co. 6.35%,
1/12/00............................ A-1 3,500 3,493,209
General Electric Capital Corp 6.30%,
2/2/00............................. A-1+ 250 248,600
-----------
13,198,694
-----------
FEDERAL AGENCY SECURITIES--VARIABLE--0.9%
FNMA 5.54% (final maturity
2/24/00)........................... 1,600 1,586,704
-----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $14,785,398)................................ 14,785,398
-----------
TOTAL INVESTMENTS--102.7%
(Identified cost $124,303,349)............................... 182,078,940(a)
Cash and receivables, less liabilities--(2.7%)............... (4,728,210)
-----------
NET ASSETS--100.0%............................................. $177,350,730
===========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $59,153,978 and gross depreciation of $1,378,387 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purposes
was $124,303,349.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
66
<PAGE>
PHOENIX-SENECA STRATEGIC THEME SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$124,303,349)............................................. $182,078,940
Cash........................................................ 485
Receivables
Fund shares sold.......................................... 303,355
Dividends and interest.................................... 53,158
Prepaid expenses............................................ 1,096
------------
Total assets............................................ 182,437,034
------------
LIABILITIES
Payables
Investment securities purchased........................... 4,891,869
Fund shares repurchased................................... 5,424
Investment advisory fee................................... 103,895
Financial agent fee....................................... 14,309
Trustees' fee............................................. 6,958
Accrued expenses............................................ 63,849
------------
Total liabilities....................................... 5,086,304
------------
NET ASSETS.................................................. $177,350,730
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $123,904,272
Accumulated net realized loss............................. (4,329,133)
Net unrealized appreciation............................... 57,775,591
------------
NET ASSETS.................................................. $177,350,730
============
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 8,777,490
============
Net asset value and offering price per share................ $ 20.21
============
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 495,867
Interest.................................................. 419,090
-----------
Total investment income................................. 914,957
-----------
EXPENSES
Investment advisory fee................................... 868,675
Financial agent fee....................................... 140,893
Printing.................................................. 33,245
Custodian................................................. 30,226
Professional.............................................. 18,680
Trustees.................................................. 16,500
Miscellaneous............................................. 9,508
-----------
Total expenses.......................................... 1,117,727
-----------
NET INVESTMENT LOSS......................................... (202,770)
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 13,199,048
Net change in unrealized appreciation (depreciation) on
investments............................................. 42,719,485
-----------
NET GAIN ON INVESTMENTS..................................... 55,918,533
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $55,715,763
===========
</TABLE>
See Notes to Financial Statements
67
<PAGE>
PHOENIX-SENECA STRATEGIC THEME SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
------------ ------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ (202,770) $ (5,345)
Net realized gain (loss).................................. 13,199,048 10,385,680
Net change in unrealized appreciation (depreciation)...... 42,719,485 12,160,802
------------ ------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 55,715,763 22,541,137
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... -- --
Net realized gains........................................ (17,567,336) (4,406,657)
In excess of net realized gains........................... (4,126,364) --
Tax return of capital..................................... (3,466,970) --
------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (25,160,670) (4,406,657)
------------ ------------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (4,545,105 and 1,899,576
shares, respectively)................................... 81,164,325 24,310,681
Net asset value of shares issued from reinvestment of
distributions (1,301,555 and 289,988 shares,
respectively)........................................... 25,160,670 4,406,657
Cost of shares repurchased (1,945,704 and 1,521,202
shares, respectively)................................... (34,627,074) (19,373,613)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 71,697,921 9,343,725
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS..................... 102,253,014 27,478,205
NET ASSETS
Beginning of period....................................... 75,097,716 47,619,511
------------ ------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $0 AND $0, RESPECTIVELY)............... $177,350,730 $ 75,097,716
============ ============
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, FROM INCEPTION
-------------------------------------------- 1/29/96 TO
1999 1998 1997 12/31/96
---------- ---------- ---------- ---------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period....................... $15.40 $11.32 $10.98 $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss)............................. -- 0.01 0.05 0.04
Net realized and unrealized gain (loss).................. 8.19 5.03 1.82 0.99
------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS....................... 8.19 5.04 1.87 1.03
------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income..................... -- (0.01) (0.05) (0.04)
Dividends from net realized gains........................ (2.36) (0.95) (1.16) --
In excess of net realized gains.......................... (0.55) -- (0.31) --
Tax return of capital.................................... (0.47) -- (0.01) (0.01)
------ ------ ------ ------
TOTAL DISTRIBUTIONS.................................... (3.38) (0.96) (1.53) (0.05)
------ ------ ------ ------
CHANGE IN NET ASSET VALUE.................................. 4.81 4.08 0.34 0.98
------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD............................. $20.21 $15.40 $11.32 $10.98
====== ====== ====== ======
Total return............................................... 54.98% 44.69% 17.16% 10.33%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)...................... $177,351 $75,098 $47,620 $25,972
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3).................................... 0.97% 0.99% 1.00% 1.00%(1)
Net investment income (loss)............................. (0.18)% (0.01)% 0.42% 0.64%(1)
Portfolio turnover rate.................................... 150% 364% 642% 391%(2)
</TABLE>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 1.14%, and
1.28% for the periods ended December 31, 1997 and 1996, respectively.
See Notes to Financial Statements
68
<PAGE>
PHOENIX-ABERDEEN NEW ASIA SERIES
INVESTOR PROFILE
The Fund is appropriate for investors seeking long-term capital appreciation
by investing primarily in a diversified portfolio of equity securities in
countries throughout Asia with the exception of Japan. The fund essentially
focuses on quality companies with strong management, solid growth prospects and
attractive relative valuations. Investors should note that foreign investments
pose added risks such as currency fluctuation, less public disclosure, as well
as economic and political risks.
INVESTMENT ADVISOR'S REPORT
For the 12 months ended December 31, 1999, the Fund returned 50.96 %
compared with a return of 55.23% for the Fund's benchmark index, the Morgan
Stanley Capital International (MSCI) All Country (AC) Asia Pacific Free ex Japan
Index(1). Investors should consider all performance periods and the effect of
the past 12 months' strong stock market when evaluating performance. All
performance figures assume reinvestment of distributions and are net of sales
charges.
A year ago it was difficult to forecast an Asian upturn with any confidence.
Markets were on the floor, and it was symptomatic that good quality stocks were
trading at a discount to the net cash on their balance sheets. However,
governments slowly accepted the necessity of re-structuring, strongly encouraged
by the IMF.
The policy mix has been similar across countries--a mixture of devaluation
followed by high interest rates to stabilize currencies and then government
spending to stimulate demand. At the same time, governments have addressed some
of the core micro-sector problems. The main one has been the accumulation of bad
loans, which was the result of poor bank regulation and inadequate competition.
Efforts have focused on forcing under-capitalized banks to close, merge, or
accept a measure of foreign ownership.
The shake-up of the banks has obviously had ramifications for indebted
customers--those carefree borrowers who once believed they could borrow in cheap
U.S. dollars and could ignore the currency risk. Some of the largest
corporations have accepted the need for business focus. In this sense, like
their Western counterparts, they have moved to sell off non-core activities.
However, there are no ready conclusions. Some have gone through the motions and
remain over-staffed, riddled with excess capacity and, importantly, still have
the same management in charge. These too-big-to-fail companies are usually those
with political connections. Small and medium-sized companies, by contrast, have
had to adapt as a matter of priority.
While it has been possible to make a fair guess as to which companies would
survive, continued contraction in economies through the late summer last year
meant earnings were precarious. Once currencies began to stabilize, however, it
was the region's exporters that benefited first. Many markets then leapt through
the third quarter as investors returned. Gains were somewhat flattered by the
bounce from the low base of markets.
The past few months have witnessed a succession of upward revisions to
growth expectations. Signs of a revival in Japan's economy, coupled with
continued strong growth in the U.S., have been positive. Evidence that
restructuring is working has also been key. Anecdotal evidence suggests that
consumers are becoming more confident too. These factors, along with a weakening
outlook for Wall Street, have been sufficient to re-ignite foreign investment in
the region. Regional funds have reduced cash positions, while global asset
allocators have upped their Asia weightings. This new wave of buying has caused
markets to surge.
Most countries have benefited. Generally, investors have been drawn to
markets where restructuring has seen economies turn round fastest. Korea,
because of its sorry history of industrial relations and oligarchic
conglomerates, has been the main surprise. The government there has led reforms
that would have once appeared unthinkable. Banks were sold off to foreigners;
stakes released in key companies; and companies told to sell (or swap) assets.
The combination of government threat and bluff has rubbed off successfully on
corporate attitudes. At last, companies are paying more than lip service to
minority shareholders' interest and corporate governance. The management mantra
is no longer to be the biggest but to pay down debt and improve returns.
The Thai government has followed a similar hands-on program, although the
corporate landscape there is very different. Its main achievement was the
passage of a controversial bankruptcy and foreclosure law, which was the
centrepiece of reform commitments made to the IMF. However, the law, which gives
creditors more teeth by shortening the legal process for recovery of assets, has
needed a test case.
Some of the best value has been emerging in Singapore. Traditionally, the
island's relatively advanced economic development has often served to dull its
interest to investors, for faster growth has been available elsewhere. Now its
virtues--clean government, tight corporate regulation, and solvent banks--have
lent it an advantage. Moreover, the government has pushed forward deregulation
and is encouraging more competition. Local banks have been put on notice that
restrictions on
69
<PAGE>
PHOENIX-ABERDEEN NEW ASIA SERIES
foreign operators will be lifted. Share buy-backs are now permitted. Local and
foreign share tranches are being amalgamated. Restructuring and shareholder
value have thus become potent themes behind a sharp bounce in earnings.
In Indonesia, which had been wracked by religious and ethnic violence, the
government's managed to close 38 banks, took over seven more, and agreed to bail
out nine others. This has been the government's strongest step to revitalise a
financial system laid low by non-performing loans. Although this is encouraging
news, political uncertainty casts a huge shadow. The first free parliamentary
elections in 44 years took just place this June. The absence of violence was a
good omen, but the real test is the presidential race--an election to be forged
by coalition deal-making rather than in up-country poll booths. The market has
stormed ahead.
Malaysia earned the opprobrium of the investment community after it imposed
capital controls last autumn. Yet the government, in spite of the bad press it
continues to receive, has moved to clean up its banking sector. The central bank
continues to push for a consolidation in the financial sector.
The Hong Kong exchange has behaved as though recovery were just around the
corner. Investors have been scrambling for Internet and telecom stocks that look
cheap compared with international peers. Look at the underlying economy, though,
and conditions appear bleak. The currency peg has been an impediment to growth.
Deprived of the ability to manoeuvre exchange rates, the ex-colony has been
battered by high costs (and high real interest rates). Increasingly, it has
become dependent on the mainland for growth, but the combination there of price
deflation and mounting unemployment has presented Beijing with awkward policy
choices. Devaluation is the option that dare not speak its name. Although the
threat has been around for a year, it doesn't mean it has evaporated. In the
meantime, growth is slowing and fiscal stimulus, after the huge injections of
the past couple of years, becomes less feasible.
OUTLOOK
Asian economies appear to be recovering. Nearly every week brings a fresh
upgrade to growth expectations. Markets have seen these revisions as evidence
that company earnings will soon recover, but market rises have been
indiscriminate. Until a recent sell-off, Indonesia was up 70% on the calendar
year--even more if currency appreciation is taken into account.
Such rapid gains partly reflect the shrunken state of markets post-crisis,
in which the effect of relatively small in-flows of capital was immediate and
dramatic. Now that markets have gained some depth, progress will naturally be
less spectacular. That is not to say markets have become over-bought; but
clearly indices cannot continue to surge at the same rate.
We feel that Asia is probably on the threshold of a new bull phase that
could last for some time. However, there are several pre-conditions to be met if
markets are to reward investors. Our major reservation is over the pace and
sustainability of recovery. Headline growth figures look good, but it is a
legitimate concern that governments may already be patting themselves on the
back. Equity markets have become a bellwether of success--falsely, because they
discount expectations, which can always change. Government support operations in
some markets (like Taiwan, Hong Kong and China) are anyway distorting.
The only excuse for market intervention is that it may allow investor
profits to be recycled into higher consumption. That would be good because
important indicators like retail sales are still flat. Yet it is an admission of
sorts that economies are not as healthy as they would seem. Indeed, much of the
structural adjustment that markets are now discounting remains to be tackled,
and it falls to governments to push through market opening. Over capacity is
still rife, and it is a commonplace that some big corporations are hoping to
trade their way out of trouble. In addition, many companies have come to the
market on the back of recent jumps in shares in order to raise new money.
Investors have lapped up the various rights issues and initial public offerings.
Yet for every company with an acquisition policy, there is another that is
simply reshuffling financial assets. Given the dilution to earnings that new
money brings, choosing between these is a matter of importance. Our conviction
is that profits are becoming artificially flattered as last year's writedowns
drop out of year-over-year figures. Real bottom line profit growth is still
scarce. All these factors therefore make the timeframe of recovery open-ended.
Markets are also sensitive to external risks. In particular, rising U.S.
rates could put pressure on currencies, requiring Asian domestic rates to
follow. The yield on some sovereign debt, which acts as a lead indicator of
interest rate movements, has recently climbed even though domestic inflation
across the region is muted. The effect will make bonds (where capital is
guaranteed) more attractive relative to equities. Japan is also a problem area.
Officials there are privately admitting that more government spending will be
required to shift the embattled economy. This is a worry because demand is vital
for regional trade.
(1) The Morgan Stanley Capital International (MSCI) All Country (AC) Asia
Pacific ex Japan Index is an unmanaged, commonly used measure of total
return performance for Pacific Basin countries, with the exception of Japan.
The Index is not available for direct investment.
70
<PAGE>
PHOENIX-ABERDEEN NEW ASIA SERIES
One or all of these issues could grow in magnitude. Equally, any trimming in
today's equity levels could signal a major buying opportunity, particularly if
global investors, many of whom have been too intoxicated by Wall Street, can be
persuaded of the case for re-weighting Asia. Local investors have meantime been
trading furiously; lately, profit taking has left retail latecomers with a
bloody nose. Our view is that any correction in share prices will soon find
price support. Asia is significantly more solid than when we last reported. The
balance of risks has turned in investors' favor, in our view.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NEW ASIA SERIES MSCI AC ASIA PACIFIC EX. JAPAN*
<S> <C> <C>
9/17/1996 $10,000.00 $10,000.00
12/311996 $10,015.65 $10,456.78
12/311997 $6,771.58 $6,994.88
12/31/1998 $6,470.61 $6,630.69
12/31/1999 $9,767.86 $10,292.91
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C>
FROM
INCEPTION
9/17/96
TO
1 YEAR 12/31/99
- --------------------------------------------------------------------------------------
New Asia Series 50.96% (0.71)%
- --------------------------------------------------------------------------------------
MSCI AC Asia Pacific Ex. Japan* 55.23% 0.88%
- --------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 9/17/96
(inception of the Fund). Returns shown include the reinvestment of all
distributions at net asset value, and the change in share price for the stated
period. Returns indicate past performance, which is not predictive of future
performance. Investment return and net asset value will fluctuate so that your
shares, when redeemed, may be worth more or less than the original cost.
* Morgan Stanley Capital International All Country Asia Pacific (excluding
Japan) Index is a market-value weighted average of the performance of
securities listed on the stock exchanges of 14 countries in Asia and the
Pacific Basin. Performance is calculated on a total return basis, as reported
by Frank Russell Company.
71
<PAGE>
PHOENIX-ABERDEEN NEW ASIA SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
FOREIGN COMMON STOCKS--97.6%
AUSTRALIA--13.7%
Australian Gas Light Co., Ltd. (Natural
Gas)...................................... 65,000 $ 381,783
BRL Hardy Ltd. (Beverages (Alcoholic))...... 125,000 603,619
Broken Hill Proprietary Co. Ltd.
(Manufacturing (Diversified))............. 15,000 197,110
Commonwealth Bank of Australia (Banks (Major
Regional))................................ 15,000 258,497
Leighton Holdings Ltd. (Engineering &
Construction)............................. 65,000 251,960
Pacifica Group Ltd. (Auto Parts &
Equipment)................................ 85,000 282,017
QBE Insurance Group Ltd. (Insurance
(Property-Casualty))...................... 100,000 466,470
------------
2,441,456
------------
HONG KONG--19.1%
CDL Hotels International Ltd.
(Lodging-Hotels).......................... 900,000 358,912
Cheung Kong (Holdings) Ltd. (Financial
(Diversified))............................ 30,000 381,102
Giordano International Ltd. (Retail
(Specialty-Apparel))...................... 750,000 771,853
HSBC Holdings PLC (Financial
(Diversified))............................ 4,000 56,088
Johnson Electric Holdings Ltd.
(Manufacturing (Diversified))............. 65,000 417,251
Li & Fung Ltd. (Distributors (Food &
Health)).................................. 240,000 602,045
Pacific Century Insurance Holdings Ltd.
(Insurance (Property-Casualty)) (b)....... 400,000 240,561
Swire Pacific Ltd. Class B (Manufacturing
(Diversified))............................ 650,000 572,779
------------
3,400,591
------------
INDIA--9.7%
BSES Ltd. GDR (Electric Companies).......... 35,000 455,000
Gas Authority of India Ltd. GDR (Oil & Gas
(Refining & Marketing)) (b)............... 15,000 141,750
ICICI Ltd. Sponsored ADR (Financial
(Diversified)) (b)........................ 15,000 208,125
ICICI Ltd. Sponsored ADR (Financial
(Diversified)) (b)........................ 27,000 398,250
Mahanagar Telephone Nigam Ltd. GDR
(Telecommunications (Long Distance))...... 25,000 283,750
Videsh Sanchar Nigam, Ltd. (Telephone)...... 10,000 248,000
------------
1,734,875
------------
INDONESIA--4.6%
PT Indosat (Telecommunications (Long
Distance))................................ 250,000 558,140
PT Indosat (Persero) Tbk ADR
(Telecommunications (Long Distance))...... 12,500 270,313
------------
828,453
------------
MALAYSIA--4.6%
Carlsberg Brewery Malaysia Berhad (Beverages
(Alcoholic)).............................. 70,000 215,524
Malaysian Oxygen Berhad (Chemicals
(Specialty)).............................. 100,000 247,365
Sime UEP Properties Berhad (Financial
(Diversified))............................ 250,000 351,969
------------
814,858
------------
NEW ZEALAND--2.0%
Telecom Corporation of New Zealand Ltd.
(Telephone)............................... 75,000 352,687
------------
<CAPTION>
SHARES VALUE
----------- ------------
<S> <C> <C> <C>
PHILIPPINES--5.5%
Ayala Land, Inc. (Financial
(Diversified))............................ 1,400,000 $ 364,764
Bank of The Philippine Islands (Banks (Major
Regional))................................ 120,000 345,409
La Tondena Distillers, Inc. (Beverages
(Alcoholic)).............................. 350,000 277,916
------------
988,089
------------
SINGAPORE--10.7%
Clipsal Industries (Holdings) Ltd.
(Electrical Equipment).................... 175,000 193,335
Robinson & Co. Ltd. (Retail (Department
Stores)).................................. 125,000 427,799
Singapore Airlines Ltd. (Airlines).......... 35,000 397,178
Singapore Press Holdings Ltd. (Publishing
(Newspapers))............................. 9,000 195,077
United Overseas Bank Ltd. (Banks (Major
Regional))................................ 79,200 699,033
------------
1,912,422
------------
SOUTH KOREA--14.1%
H&CB (Banks (Major Regional)) (b)........... 11,500 364,597
Kookmin Bank (Banks (Major Regional))....... 21,607 338,709
Korea Telecom Corp. (Telephone)............. 5,000 788,199
Korea Telecom Corp. ADR (Telephone)......... 4,000 278,800
Pohang Iron & Steel Co. Ltd. (Iron &
Steel).................................... 5,000 589,865
Seoul City Gas Co. Ltd. (Natural Gas)....... 8,000 147,952
------------
2,508,122
------------
SRI LANKA--2.1%
John Keells Holdings Ltd. (Beverages
(Alcoholic)).............................. 70,000 198,741
National Development Bank Ltd. (Banks (Major
Regional))................................ 110,000 176,923
------------
375,664
------------
TAIWAN--1.9%
Standard Foods Taiwan Ltd. GDR (Foods)
(b)....................................... 80,864 333,564
------------
THAILAND--5.6%
BEC World Public Co. Ltd. (Entertainment)... 40,000 282,490
Hana Microelectronics Public Co. Ltd.
(Electronics (Component Distributors))
(b)....................................... 70,900 338,829
Phatra Insurance Public Co. Ltd. Foreign
(Insurance (Property-Casualty))........... 71,600 127,365
Ruam Pattana Fund II (Financial
(Diversified)) (b)........................ 1,500,000 254,879
------------
1,003,563
------------
UNITED KINGDOM--4.0%
HSBC Holdings PLC (Financial
(Diversified))............................ 36,000 501,841
Rowe Evans Investments Group PLC
(Agricultural Products)................... 200,000 208,374
------------
710,215
------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $14,962,102)............................. 17,404,559
------------
TOTAL LONG-TERM INVESTMENTS--97.6%
(Identified cost $14,962,102)............................. 17,404,559
------------
</TABLE>
See Notes to Financial Statements
72
<PAGE>
PHOENIX-ABERDEEN NEW ASIA SERIES
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- -----------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--4.8%
COMMERCIAL PAPER--4.8%
Donnelley (R.R.) & Sons Co. 5%,
1/3/00.............................. A-1 $400 $ 399,889
Koch Industries, Inc. 7.50%, 1/3/00... A-1+ 460 459,808
-----------
859,697
-----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $859,697).................................... 859,697
-----------
TOTAL INVESTMENTS--102.4%
(Identified cost $15,821,799)................................. 18,264,256(a)
Cash and receivables, less liabilities--(2.4%)................ (425,875)
-----------
NET ASSETS--100.0%.............................................. $17,838,381
===========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $4,648,333 and gross depreciation of $2,223,061 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purposes
was $15,838,984.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
73
<PAGE>
PHOENIX-ABERDEEN NEW ASIA SERIES
INDUSTRY DIVERSIFICATION
AS A PERCENTAGE OF TOTAL VALUE OF
TOTAL LONG-TERM INVESTMENTS
(UNAUDITED)
<TABLE>
<S> <C>
Agricultural Products................................... 1.2%
Airlines................................................ 2.3
Auto Parts & Equipment.................................. 1.6
Banks (Major Regional).................................. 12.5
Beverages (Alcoholic)................................... 7.4
Chemicals (Specialty)................................... 1.4
Distributors (Food & Health)............................ 3.5
Electric Companies...................................... 2.6
Electrical Equipment.................................... 1.1
Electronics (Component Distributors).................... 2.0
Engineering & Construction.............................. 1.5
Entertainment........................................... 1.6
Financial (Diversified)................................. 14.5
Foods................................................... 1.9
Insurance (Property-Casualty)........................... 4.8
Iron & Steel............................................ 3.4
Lodging-Hotels.......................................... 2.1
Manufacturing (Diversified)............................. 6.8
Natural Gas............................................. 3.0
Oil & Gas (Refining & Marketing)........................ 0.8
Publishing (Newspapers)................................. 1.1
Retail (Department Stores).............................. 2.5
Retail (Specialty-Apparel).............................. 4.4
Telecommunications (Long Distance)...................... 6.4
Telephone............................................... 9.6
-----
100.0%
=====
</TABLE>
See Notes to Financial Statements
74
<PAGE>
PHOENIX-ABERDEEN NEW ASIA SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$15,821,799).............................................. $18,264,256
Cash........................................................ 108,112
Foreign currency at value (Identified cost $45)............. 45
Receivables
Fund shares sold.......................................... 38,202
Dividends and interest.................................... 23,714
Receivable from adviser................................... 13,210
Prepaid expenses............................................ 155
-----------
Total assets............................................ 18,447,694
-----------
LIABILITIES
Payables
Fund shares repurchased................................... 422,333
Investment securities purchased........................... 104,000
Trustees' fee............................................. 6,958
Financial agent fee....................................... 6,175
Accrued expenses............................................ 69,847
-----------
Total liabilities....................................... 609,313
-----------
NET ASSETS.................................................. $17,838,381
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $17,904,668
Undistributed net investment income....................... 135,265
Accumulated net realized loss............................. (2,644,007)
Net unrealized appreciation............................... 2,442,455
-----------
NET ASSETS.................................................. $17,838,381
===========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 1,947,163
===========
Net asset value and offering price per share................ $ 9.16
===========
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 351,229
Interest.................................................. 27,350
Foreign taxes withheld.................................... (18,321)
----------
Total investment income................................. 360,258
----------
EXPENSES
Investment advisory fee................................... 131,315
Financial agent fee....................................... 59,444
Custodian................................................. 54,519
Printing.................................................. 24,824
Professional.............................................. 20,196
Trustees.................................................. 16,591
Miscellaneous............................................. 7,395
----------
Total expenses.......................................... 314,284
Less expenses borne by investment adviser............... (150,141)
----------
Net expenses............................................ 164,143
----------
NET INVESTMENT INCOME....................................... 196,115
----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 743,218
Net realized gain on foreign currency transactions........ 5,446
Net change in unrealized appreciation (depreciation) on
investments............................................. 4,529,483
Net change in unrealized appreciation (depreciation) on
foreign currency and foreign currency transactions...... 294
----------
NET GAIN ON INVESTMENTS..................................... 5,278,441
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $5,474,556
==========
</TABLE>
See Notes to Financial Statements
75
<PAGE>
PHOENIX-ABERDEEN NEW ASIA SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
----------- -----------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 196,115 $ 195,924
Net realized gain (loss).................................. 748,664 (2,798,842)
Net change in unrealized appreciation (depreciation)...... 4,529,777 2,317,131
----------- -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 5,474,556 (285,787)
----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (136,615) (36,125)
In excess of net investment income........................ -- (4,147)
----------- -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (136,615) (40,272)
----------- -----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (2,129,247 and 2,726,957
shares, respectively)................................... 16,715,248 16,221,934
Net asset value of shares issued from reinvestment of
distributions (16,687 and 6,603 shares, respectively)... 136,615 40,272
Cost of shares repurchased (1,750,867 and 2,736,922
shares, respectively)................................... (13,861,863) (16,442,409)
----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 2,990,000 (180,203)
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 8,327,941 (506,262)
NET ASSETS
Beginning of period....................................... 9,510,440 10,016,702
----------- -----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $135,265 AND $94,548, RESPECTIVELY).... $17,838,381 $ 9,510,440
=========== ===========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, FROM INCEPTION
------------------------------------------------------ 9/17/96 TO
1999 1998 1997 12/31/96
-------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period.............. $6.13 $6.44 $9.96 $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).................... 0.11(4) 0.13(4) 0.15 0.05
Net realized and unrealized gain (loss)......... 3.00 (0.41) (3.36) (0.04)
------ ------- ------- ------
TOTAL FROM INVESTMENT OPERATIONS.............. 3.11 (0.28) (3.21) 0.01
------ ------- ------- ------
LESS DISTRIBUTIONS
Dividends from net investment income............ (0.08) (0.03) (0.15) (0.05)
Dividends from net realized gains............... -- -- (0.01) --
In excess of net investment income.............. -- -- (0.10) --
Tax return of capital........................... -- -- (0.05) --
------ ------- ------- ------
TOTAL DISTRIBUTIONS........................... (0.08) (0.03) (0.31) (0.05)
------ ------- ------- ------
CHANGE IN NET ASSET VALUE......................... 3.03 (0.31) (3.52) (0.04)
------ ------- ------- ------
NET ASSET VALUE, END OF PERIOD.................... $9.16 $6.13 $6.44 $ 9.96
====== ======= ======= ======
Total return...................................... 50.96% (4.44)% (32.39)% 0.16%(3)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)............. $17,838 $9,510 $10,017 $11,585
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(1)........................... 1.25% 1.25% 1.25% 1.25%(2)
Net investment income........................... 1.49% 2.09% 1.63% 2.40%(2)
Portfolio turnover rate........................... 35% 46% 27% 2%(3)
</TABLE>
(1) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 2.39%,
2.50%, 2.00% and 2.87% for the periods ended December 31, 1999, 1998, 1997
and 1996, respectively.
(2) Annualized.
(3) Not annualized.
(4) Computed using average shares outstanding.
See Notes to Financial Statements
76
<PAGE>
PHOENIX-DUFF & PHELPS REAL ESTATE SECURITIES SERIES
INVESTOR PROFILE
The Fund is appropriate for investors seeking investment in a diversified
portfolio of real estate investment trusts and real estate operating companies.
The Fund's objective is to emphasize appreciation and current yield equally.
Investors should note that real estate investing involves certain risks,
including refinancing, economic impact on the industry, changes in the value of
properties owned, dependency on management skills, and liquidity risks similar
to those associated with small-company investing.
INVESTMENT ADVISOR'S REPORT
During this reporting period, the Phoenix-Duff & Phelps Edge Real Estate
Securities Portfolio outperformed its benchmark. For the 12 months ended
December 31, 1999, the Fund returned 4.78% compared with a return of (4.62)% for
the NAREIT Equity Total Return Index(1). The Fund also outperformed both the S&P
Utilities Index(2), which had a negative return of (8.89)% and the Lehman
Brothers Long Treasury Bond Index(3), which was down (8.74)%, in a rising
interest rate environment, which adversely impacted fixed income securities and
utilities. All performance figures assume reinvestment of distributions and are
net of sales charges.
We attribute our value-added performance to our ground-up stock selection,
style, and sector weightings. Our style combines a pursuit of growth and value,
and is sometimes referred to as "growth at a reasonable price." Exhaustive
research is conducted on each holding before its purchase and on an on-going
basis. An integral and distinguishing part of the process is a regular property
review. We recently toured one of our apartment REIT's properties in Santa Clara
County, California, posing as a prospective tenant. We were able to compare the
execution of the company's strategy to the goals articulated by the firm's
regional managers and executives. On this occasion we found that property level
management understood the direction provided by senior management and adapted
the directives to meet the conditions of the local market. Confirmation of
alignment of strategy and implementation supported our decision to maintain the
investment in this company. Regular property reviews have helped us make timely
buy and sell decisions.
Given both the state of equilibrium in most real estate sectors and the
capital constraint facing real estate companies, the importance of management
quality is growing. Some management teams have been caught in the market's
headlights like deer. The teams that adapt, focus on strong markets where they
can deliver high internal earnings growth, build a strong rapport with tenants,
and demonstrate the ability to recycle capital successfully make it across the
due diligence road safely and into our holdings. Examples include Essex
Properties, Spieker Properties, and Centerpoint Properties.
Investors' perceptions of tempered earnings growth rates, weakening property
markets, rising interest rates, the noise from too many companies representing
too little capital, and lingering doubts about the pervasiveness of
self-interest decision-making in this sector, contributed to the continued flow
of capital out of the sector in 1999.
OUTLOOK
We are witnessing the emergence of a number of themes that are positive for
equity REITs. The first is the discipline provided by the capital markets to
keep supply in balance with demand, particularly in markets where there are
limited barriers to entry. Our investment bias is toward REITs with portfolios
concentrated in markets with high barriers to entry. Without the capital
markets' discipline, office markets such as Dallas, a low barrier to entry
market, would have been significantly overbuilt for the third decade in a row.
Dallas went through boom and bust periods in the '70s, again in the '80s, and
with not much time left in the '90s, it almost pulled it off again. It remains
mildly overbuilt, but has not gone bust.
This discipline is lengthening the real estate cycle. Moderation is
occurring in both the historical boom and bust portions, providing a smoothing
effect. While it is likely to limit the attractive returns that have
historically been available during the recovery period of the cycle, shorter and
less intense cycles support the view of real estate as a stable core industry
with a low risk profile. Has it helped all sectors and markets? Of course not.
Nationwide, you can find markets where any one of the 14 real estate sectors is
being overbuilt. For example, we continue to be rewarded by having a zero
weighting for the lodging sector, given the excessive number of hotel rooms
being developed.
The second major positive theme is a build-up of earnings growth in markets
where high barriers to entry or high market share concentrations exist. In many
of these cases, rents have increased rapidly or even spiked. We call this
build-up of earnings growth, loss-to-lease. It represents the amount of income
that a portfolio could generate if all of its leases were brought to market.
(1) The NAREIT (National Association of Real Estate Investment Trusts) Equity
Total Return Index is an unmanaged, commonly used measure of real estate
equity market total return performance.
(2) The S&P Utilities Index is an unmanaged, commonly used measure of total
return performance of the utilities market.
(3) The Lehman Brothers Long T-Bond Index is an unmanaged, commonly used measure
of total return performance of the Treasury bond market. The indices are not
available for direct investment.
77
<PAGE>
PHOENIX-DUFF & PHELPS REAL ESTATE SECURITIES SERIES
For example, in the case of Spieker Properties, this would amount to more
than a 38% increase in earnings if its leases were rolled to market levels by
our estimate. The speed at which a company will capture this loss-to-lease is
based on how quickly the leases mature and if there are any restrictions on
bringing the leases to market. For example, if Speiker's average lease is five
years, we can expect close to 20% of the leases to roll per year. An apartment
company rolls its leases at least once a year. Essex Properties, an apartment
company with a portfolio in the West Coast's demand-favored markets, has
significant loss-to-lease growth potential.
A third trend we are witnessing is the bifurcation of equity REITs into
companies that embrace the goal of providing shareholder value and those that
continue to operate as if they were still private. For example, when a company's
stock has been sold off to the extent that repurchasing it will provide a higher
return than acquisitions or development, logic indicates the company should slow
its external growth pursuits and implement a stock buyback program. To fund the
program, the company may have to sell assets to avoid increasing the leverage on
the balance sheet, leading us to our next trend.
The recycling of capital is the fourth trend, and is a proven concept.
Manufacturers learned long ago that they can improve their return on equity by
turning their inventory and receivables at a faster pace. Smart REIT management
teams have chosen to recycle capital by selling assets where most of the upside
has been achieved and subsequently redeploying the capital into better
investment opportunities. REIT management teams that remain tied to an additive
strategy more appropriate for a fluid real estate capital market are finding
that they fall out of favor, even if the outlook for their particular sector is
positive.
A fifth trend we are seeing is the growing use of the joint venture
structure. The use of joint ventures can help REITs tap new capital sources and
recycle capital, diversify risk, partner with expertise, increase fee income,
maintain control through the property management and development
responsibilities, and earn higher returns. There is, of course, some downside
risk if the transactions are not well structured, not transparent, and do not
emphasize financial disclosure.
Consolidation and privatization represent the sixth trend. We have seen a
growing number of mergers and buy-outs, but the amount of activity will most
likely remain at a low level until management teams of the out-of-favor
companies give up their poison pills and accept what is inevitable.
Until the level of activity becomes material and significant premiums are
offered to those companies being acquired or going private, we do not think a
bottom-fishing style will earn trophy returns. Over the near term, we are likely
to see the continuation of the migration of capital to REITs with proven
strategies to create shareholder value and to prosper in a capital constrained
environment. The result should be de facto consolidation with investment in a
smaller number of companies.
Finally, with the recent passage of the REIT Modernization Act by Congress,
REITs will be able to establish their own taxable subsidiaries and offer new
products and services to tenants. Companies such as Equity Residential
Properties, with over 228,000 apartments, are already beginning to offer telecom
and financial services to their captive customer base. This will allow REITs to
grow incremental earnings with very little capital deployed. That's definitely
positive.
So where do we see earnings growth and returns headed? The themes outlined
above reflect a sector that is maturing. Two years of capital constraint have
accelerated this process. As the majority of REITs enter their fifth or sixth
year as public companies and each management team reexamines its dedication to
operating a public company, the schism between dedicated, proactive management
and naive management continues to widen. We believe we can continue to steer the
portfolio toward the more mature REITs that demonstrate savvy. With earnings
growth of 7-8% projected for 2000 and a year-end NAREIT Equity Index yield of
10.0%, these mature REITs could endure some multiple contraction if interest
rates continue to rise and still deliver double-digit returns.
78
<PAGE>
PHOENIX-DUFF & PHELPS REAL ESTATE SECURITIES SERIES
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
REAL ESTATE SECURITIES SERIES NAREIT TOTAL RETURN EQUITY INDEX*
<S> <C> <C>
05/01/95 $10,000.00 $10,000.00
12/31/95 $11,779.15 $11,547.95
12/31/96 $15,677.16 $15,618.28
12/31/97 $19,133.66 $18,787.22
12/31/98 $15,078.55 $15,498.99
12/31/99 $15,798.73 $14,783.46
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C>
FROM
INCEPTION
5/1/95 TO
1 YEAR 12/31/99
- --------------------------------------------------------------------------------------
Real Estate Securities Series 4.78% 10.29%
- --------------------------------------------------------------------------------------
Nareit Total Return Equity Index* (4.62)% 8.71%
- --------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 5/1/95
(inception of the Fund). Returns shown include the reinvestment of all
distributions at net asset value, and the change in share price for the stated
period. Returns indicate past performance, which is not predictive of future
performance. Investment return and net asset value will fluctuate so that your
shares, when redeemed, may be worth more or less than the original cost.
* The National Association of Real Estate Investments Trusts (NAREIT) Equity
Index is a commonly used, unmanaged indicator of REIT performance.
79
<PAGE>
PHOENIX-DUFF & PHELPS REAL ESTATE SECURITIES SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
-------- -----------
<S> <C> <C> <C>
COMMON STOCKS--99.1%
REAL ESTATE INVESTMENT TRUSTS--93.3%
DIVERSIFIED--8.3%
Colonial Properties Trust....................... 16,700 $ 387,231
Crescent Real Estate Equities Co................ 10,000 183,750
Vornado Realty Trust............................ 52,200 1,696,500
-----------
2,267,481
-----------
INDUSTRIAL/OFFICE--35.3%
INDUSTRIAL--8.4%
CenterPoint Properties Corp..................... 41,400 1,485,225
First Industrial Realty Trust, Inc.............. 30,000 823,125
-----------
2,308,350
-----------
MIXED--7.8%
Duke-Weeks Realty Corp.......................... 43,690 851,955
Reckson Associates Realty Corp.................. 62,200 1,275,100
-----------
2,127,055
-----------
OFFICE--19.1%
Alexandria Real Estate Equities, Inc............ 10,000 318,125
Boston Properties, Inc.......................... 58,500 1,820,812
Mack-Cali Realty Corp........................... 47,200 1,230,150
Spieker Properties, Inc......................... 51,200 1,865,600
-----------
5,234,687
-----------
TOTAL INDUSTRIAL/OFFICE..................................... 9,670,092
-----------
RESIDENTIAL--27.4%
APARTMENTS--23.5%
Apartment Investment & Management Co............ 45,300 1,803,506
Avalonbay Communities, Inc...................... 33,900 1,163,194
Equity Residential Properties Trust............. 30,100 1,284,894
Essex Property Trust, Inc....................... 43,500 1,479,000
Smith (Charles E.) Residential Realty, Inc...... 20,000 707,500
-----------
6,438,094
-----------
MANUFACTURED HOMES--3.9%
Manufactured Home Communities, Inc.............. 8,800 213,950
Sun Communities, Inc............................ 26,300 846,531
-----------
1,060,481
-----------
TOTAL RESIDENTIAL........................................... 7,498,575
-----------
RETAIL--19.4%
OUTLET CENTERS--1.9%
Chelsea GCA Realty, Inc......................... 17,600 523,600
-----------
REGIONAL MALLS--11.3%
CBL & Associates Properties, Inc................ 42,000 866,250
<CAPTION>
SHARES VALUE
-------- -----------
<S> <C> <C> <C>
REGIONAL MALLS--CONTINUED
General Growth Properties, Inc.................. 22,000 $ 616,000
Macerich Co. (The).............................. 49,300 1,026,056
Urban Shopping Centers, Inc..................... 21,700 588,613
-----------
3,096,919
-----------
STRIP CENTERS--6.2%
Developers Diversified Realty Corp.............. 40,000 515,000
JDN Realty Corp................................. 20,000 322,500
Kimco Realty Corp............................... 25,000 846,875
-----------
1,684,375
-----------
TOTAL RETAIL................................................ 5,304,894
-----------
SELF STORAGE--2.9%
Storage USA, Inc................................ 25,900 783,475
-----------
TOTAL REAL ESTATE INVESTMENT TRUSTS
(Identified cost $27,737,308)............................. 25,524,517
-----------
REAL ESTATE OPERATING COMPANIES--5.8%
DIVERSIFIED--0.1%
Vornado Operating, Inc. (b)..................... 3,110 18,660
-----------
INDUSTRIAL/OFFICE--5.7%
MIXED--5.7%
Reckson Service Industries, Inc. (b)............ 24,956 1,556,631
-----------
TOTAL REAL ESTATE OPERATING COMPANIES
(Identified cost $74,471)................................. 1,575,291
-----------
TOTAL COMMON STOCKS
(Identified cost $27,811,779)............................. 27,099,808
-----------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000)
----------- --------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--1.2%
COMMERCIAL PAPER--1.2%
Koch Industries, Inc. 4.50%, 1/3/00... A-1+ $345 344,914
----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $344,914).................................... 344,914
----------
TOTAL INVESTMENTS--100.3%
(Identified cost $28,156,693)................................. 27,444,722(a)
Cash and receivables, less liabilities--(0.3%)................ (94,964)
----------
NET ASSETS--100.0%.............................................. $27,349,758
==========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $2,230,759 and gross depreciation of $2,942,730 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purpose
was $28,156,693.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
80
<PAGE>
PHOENIX-DUFF & PHELPS REAL ESTATE SECURITIES SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$28,156,693).............................................. $27,444,722
Cash........................................................ 2,659
Receivables
Dividends and interest.................................... 242,126
Receivable from adviser................................... 3,992
Fund shares sold.......................................... 1,245
Prepaid expenses............................................ 592
-----------
Total assets............................................ 27,695,336
-----------
LIABILITIES
Payables
Investment securities purchased........................... 264,400
Fund shares repurchased................................... 9,005
Trustees' fee............................................. 6,958
Financial agent fee....................................... 6,844
Accrued expenses............................................ 58,371
-----------
Total liabilities....................................... 345,578
-----------
NET ASSETS.................................................. $27,349,758
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $31,425,840
Undistributed net investment income....................... 44,060
Accumulated net realized loss............................. (3,408,171)
Net unrealized depreciation............................... (711,971)
-----------
NET ASSETS.................................................. $27,349,758
===========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 2,239,414
===========
Net asset value and offering price per share................ $ 12.21
===========
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $1,772,241
Interest.................................................. 42,270
----------
Total investment income................................. 1,814,511
----------
EXPENSES
Investment advisory fee................................... 224,670
Financial agent fee....................................... 72,963
Printing.................................................. 40,841
Professional.............................................. 20,478
Trustees.................................................. 16,286
Custodian................................................. 11,679
Miscellaneous............................................. 6,491
----------
Total expenses.......................................... 393,408
Less expenses borne by investment adviser............... (93,850)
----------
Net expenses............................................ 299,558
----------
NET INVESTMENT INCOME....................................... 1,514,953
----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on securities........................... (3,294,671)
Net change in unrealized appreciation (depreciation) on
investments............................................. 2,940,274
----------
NET LOSS ON INVESTMENTS..................................... (354,397)
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $1,160,556
==========
</TABLE>
See Notes to Financial Statements
81
<PAGE>
PHOENIX-DUFF & PHELPS REAL ESTATE SECURITIES SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
------------- -------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 1,514,953 $ 1,898,008
Net realized gain (loss).................................. (3,294,671) (109,430)
Net change in unrealized appreciation (depreciation)...... 2,940,274 (13,109,206)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 1,160,556 (11,320,628)
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (1,470,893) (1,978,391)
Net realized gains........................................ -- (49,416)
Tax return of capital..................................... -- (45,581)
------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (1,470,893) (2,073,388)
------------ ------------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (571,481 and 1,369,232
shares, respectively)................................... 7,142,545 20,540,759
Net asset value of shares issued from reinvestment of
distributions (122,286 and 154,542 shares,
respectively)........................................... 1,470,893 2,073,388
Cost of shares repurchased (1,419,849 and 1,894,769
shares, respectively)................................... (17,361,135) (27,471,348)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ (8,747,697) (4,857,201)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS..................... (9,058,034) (18,251,217)
NET ASSETS
Beginning of period....................................... 36,407,792 54,659,009
------------ ------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $44,060 AND $0, RESPECTIVELY).......... $ 27,349,758 $ 36,407,792
============ ============
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, FROM INCEPTION
------------------------------------------------ 5/1/95 TO
1999 1998 1997 1996 12/31/95
------------ ------ ------ ------ ---------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period...................... $12.28 $16.38 $14.32 $11.33 $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss)............................ 0.65 0.78 0.50 0.50 0.33
Net realized and unrealized gain (loss)................. (0.09) (4.20) 2.62 3.14 1.42
------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS...................... 0.56 (3.42) 3.12 3.64 1.75
------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income.................... (0.63) (0.65) (0.48) (0.50) (0.33)
Dividends from net realized gains....................... -- (0.02) (0.58) (0.15) (0.06)
Tax return of capital................................... -- (0.01) -- -- (0.03)
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS................................... (0.63) (0.68) (1.06) (0.65) (0.42)
------ ------ ------ ------ ------
CHANGE IN NET ASSET VALUE................................. (0.07) (4.10) 2.06 2.99 1.33
------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD............................ $12.21 $12.28 $16.38 $14.32 $11.33
====== ====== ====== ====== ======
Total return.............................................. 4.78% (21.19)% 22.05% 33.09% 17.79%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)..................... $27,350 $36,408 $54,659 $22,710 $8,473
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses (3).................................. 1.00% 1.00% 1.00% 1.00% 1.00%(1)
Net investment income................................... 5.80% 5.07% 3.59% 4.36% 4.80%(1)
Portfolio turnover rate................................... 28% 18% 41% 21% 10%(2)
</TABLE>
(1) Annualized
(2) Not annualized
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 1.31%,
1.01%, 1.07%, 1.43% and 1.98% for the periods ended December 31, 1999, 1998,
1997, 1996 and 1995, respectively.
See Notes to Financial Statements
82
<PAGE>
PHOENIX RESEARCH ENHANCED INDEX SERIES
INVESTOR PROFILE
The Phoenix Research Enhanced Index Series is appropriate for investors
seeking to earn a high total return modestly in excess of the S&P 500 Index
while maintaining a return volatility similar to the S&P 500 Index.
INVESTMENT ADVISOR'S REPORT
The Phoenix Researched Enhanced Index Series returned 18.86% for the year
ended December 31,1999. The S&P 500 Index(1) returned 21.14% during this time
period, while the Lipper VA Growth and Income Average(2) returned 14.51%. All
performance figures assume reinvestment of distributions and are net of sales
charges.
The U.S. stock market ended the year posting record highs as the Dow Jones
Industrial Average climbed to a record 11,497.12, ending the year up 25%. The
S&P 500 climbed to record 1,469.25 for the year, ending 21% higher. The Nasdaq
Composite Index closed at 4,069.31, ending nearly 86% higher, the largest
one-year gain ever for a U.S. stock index.
After a strong 1998 and first half of 1999, the third and fourth quarters
were difficult ones for the Phoenix Research Enhanced Index Series. In the
second half of the year, the equity market reverted back to a very narrow group
of outperforming stocks as investors sought out the companies with positive
earnings and price momentum.
During the latter half of the year, investors tended to focus on short-term
earnings, projecting them forward indefinitely, which was a challenge to the
performance of the portfolio. The investment strategy employed by the portfolio
focuses on normalized earnings and intermediate growth rates, thus it tended to
be challenged by the unprecedented market environment that we experienced during
the latter part of the year. In addition, while the portfolio is well
diversified and its risk controls are robust, during times of extreme internal
market divergence, even modest exposures to common risk factors such as price
momentum can result in out of scale performance results.
Finally, our analysts depend on accurate financial data from the companies
that they cover to set their earnings forecasts. Companies that look attractive
to our analysts are overweighted in the portfolio and in some instances, less
than candid disclosures by company management followed by divergent reported
earnings resulted in a sharp correction in stock prices. In particular,
underperformance in the second half of the year was led by WASTE MANAGEMENT,
which was overweighted and detracted from relative performance due to the
accounting issues discussed above. Strong relative performance in the tech
sector added to performance but was more than offset by challenges from the
Services sector (primarily due to an overweight in SERVICE CORP.) and Insurance
(an underweight in AIG and an overweight in UNUMPROVIDENT was pressed by the
market's momentum buying in AIG). Additionally, difficulty with AMERICAN HOME
PRODUCTS and diet pill litigation also hurt the portfolio's performance.
OUTLOOK
We remain confident in our investment process and risk controls, and expect
that the historically wide spread between the most and least attractive names in
our universe suggests opportunities ahead. We expect the market to broaden. Most
of the positive performance over the last few years has come from the "Nifty
Fifty" & mega-cap growth stocks. The valuations on these stocks are much higher
than that of the rest of the market. We believe that a return of global growth
will cause investors to look beyond these over priced stocks to companies that
trade at much lower multiples.
(1) The S&P 500 Index is an unmanaged, commonly used measure of stock market
total return performance. The Index is not available for direct investment.
(2) The Lipper VA Growth and Income Average is an unmanaged, commonly used
measure of total return performance of funds in Lipper Growth and Income
category. The Index is not available for direct investment.
83
<PAGE>
PHOENIX RESEARCH ENHANCED INDEX SERIES
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
RESEARCH ENHANCED INDEX S&P 500 INDEX(1)
<S> <C> <C>
7/15/97 $10,000.00 $10,000.00
12/31/97 $10,582.60 $10,566.54
12/31/98 $13,934.80 $13,605.10
12/31/99 $16,563.15 $16,480.56
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C>
FROM
INCEPTION
7/15/97
TO
1 YEAR 12/31/99
- -------------------------------------------------------------------------------------
Research Enhanced Series 18.86% 22.71%
- -------------------------------------------------------------------------------------
S&P 500 Index(1) 21.14% 22.49%
- -------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 7/15/97
(inception of the Fund). Returns shown include the reinvestment of all
distributions at net asset value, and the change in share price for the stated
period. Returns indicate past performance, which is not predictive of future
performance. Investment return and net asset value will fluctuate so that your
shares, when redeemed, may be worth more or less than the original cost.
(1) The S&P 500 Index is an unmanaged, commonly used measure of stock market
total return performance. The index is not available for direct investment.
84
<PAGE>
PHOENIX RESEARCH ENHANCED INDEX SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ------------
<S> <C> <C> <C>
U.S. GOVERNMENT SECURITIES--0.2%
U.S. Treasury Notes 5.625%,
11/30/00 (c)..................... AAA $220 $ 219,175
------------
TOTAL U.S. GOVERNMENT SECURITIES
(Identified cost $219,692)................................. 219,175
------------
</TABLE>
<TABLE>
<CAPTION>
SHARES
--------
<S> <C> <C> <C>
COMMON STOCKS--93.2%
AEROSPACE/DEFENSE--0.5%
Boeing Co. (The)................................ 7,500 311,719
Goodrich (B.F) Co. (The)........................ 2,900 79,750
Lockheed Martin Corp............................ 10,800 236,250
Precision Castparts Corp........................ 100 2,625
Teledyne Technologies, Inc...................... 5 47
-----------
630,391
-----------
AIR FREIGHT--0.0%
CNF Transportation, Inc......................... 600 20,700
-----------
AIRLINES--0.2%
AMR Corp. (b)................................... 2,100 140,700
Northwest Airlines Corporation-Class A.......... 1,000 22,250
Southwest Airlines Co........................... 6,500 105,219
US Airways Group, Inc. (b)...................... 300 9,619
-----------
277,788
-----------
ALUMINUM--0.6%
Alcoa, Inc...................................... 7,200 597,600
Reynolds Metals Co.............................. 2,400 183,900
-----------
781,500
-----------
AUTO PARTS & EQUIPMENT--0.4%
Cooper Tire & Rubber Co......................... 900 14,006
Dana Corp....................................... 4,200 125,737
Delphi Automotive Systems Corp.................. 12,300 193,725
Genuine Parts Co................................ 3,700 91,806
Goodyear Tire & Rubber Co. (The)................ 3,500 98,656
Lear Corp. (b).................................. 1,700 54,400
-----------
578,330
-----------
AUTOMOBILES--1.1%
Ford Motor Co................................... 20,900 1,116,844
General Motors Corp............................. 3,700 268,944
-----------
1,385,788
-----------
BANKS (MAJOR REGIONAL)--2.4%
AmSouth BanCorp................................. 6,300 121,669
Bank One Corp................................... 19,800 634,837
Comerica, Inc................................... 2,600 121,387
FleetBoston Financial Corp...................... 15,000 522,187
Huntington Bancshares, Inc...................... 3,800 90,725
KeyCorp......................................... 8,300 183,637
Nationalcity Corp............................... 9,800 232,137
PNC Bank Corp................................... 5,300 235,850
Regions Financial Corp.......................... 3,700 92,962
SouthTrust Corp................................. 3,000 113,437
Summit Bancorp.................................. 3,200 98,000
SunTrust Banks, Inc............................. 2,600 178,912
U.S. Bancorp.................................... 12,400 295,275
Union Planters Corp............................. 2,300 90,706
Wachovia Corp................................... 900 61,200
Wells Fargo Co.................................. 3,100 125,356
-----------
3,198,277
-----------
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
BANKS (MONEY CENTER)--1.8%
Bank of America Corp............................ 27,700 $1,390,194
Chase Manhattan Corp. (The)..................... 800 62,150
First Union Corp................................ 18,300 600,469
Firstar Corp.................................... 15,100 318,987
----------
2,371,800
----------
BANKS (REGIONAL)--0.5%
Associated Banc-Corp............................ 1,000 34,250
BancWest Corp................................... 1,200 23,400
CCB Financial Corp.............................. 500 21,781
Colonial BancGroup, Inc. (The).................. 600 6,225
Commerce Bancshares, Inc........................ 1,100 37,262
Commercial Federal Corp......................... 400 7,125
Compass Bancshares, Inc......................... 1,900 42,394
First Tennessee National Corp................... 2,200 62,700
First Virginia Banks, Inc....................... 600 25,800
FirstMerit Corp................................. 1,400 32,200
Hibernia Corp. Class A.......................... 2,300 24,437
M & T Bank Corp................................. 100 41,425
Marshall & Ilsley Corp.......................... 1,400 87,937
Mercantile Bankshares Corp...................... 1,000 31,937
North Fork Bancorporation, Inc.................. 2,100 36,750
Pacific Century Financial Corp.................. 700 13,081
Peoples Heritage Financial Group, Inc........... 1,700 25,606
Provident Financial Group, Inc.................. 300 10,762
TCF Financial Corp.............................. 1,300 32,337
Wilmington Trust Corp........................... 400 19,300
----------
616,709
----------
BEVERAGES (NON-ALCOHOLIC)--1.5%
Coca-Cola Co. (The)............................. 30,800 1,794,100
PepsiCo, Inc.................................... 4,600 162,150
----------
1,956,250
----------
BIOTECHNOLOGY--0.3%
Amgen, Inc. (b)................................. 3,000 180,187
Genzyme Corp. (b)............................... 1,200 54,000
Human Genome Sciences, Inc. (b)................. 300 45,787
IDEC Pharmaceuticals Corp. (b).................. 600 58,950
----------
338,924
----------
BROADCASTING (TELEVISION, RADIO & CABLE)--2.3%
AT&T Corp.- Liberty Media Group Class A (b)..... 15,500 879,625
Comcast Corp. Special Class A................... 17,200 864,300
MediaOne Group, Inc. (b)........................ 17,100 1,313,494
----------
3,057,419
----------
BUILDING MATERIALS--0.0%
Masco Corp...................................... 100 2,537
Owens Corning................................... 1,200 23,175
USG Corp........................................ 700 32,987
----------
58,699
----------
CHEMICALS--1.3%
Air Products & Chemicals, Inc................... 7,800 261,787
Dow Chemical Co. (The).......................... 2,200 293,975
Du Pont (E.I.) de Nemours & Co.................. 600 39,525
IMC Global, Inc................................. 3,700 60,587
Lyondell Chemical Co............................ 3,300 42,075
Praxair, Inc.................................... 3,800 191,187
Rohm & Haas Co.................................. 7,600 309,225
Solutia, Inc.................................... 4,100 63,294
Union Carbide Corp.............................. 6,100 407,175
----------
1,668,830
----------
</TABLE>
See Notes to Financial Statements
85
<PAGE>
PHOENIX RESEARCH ENHANCED INDEX SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
CHEMICALS (DIVERSIFIED)--0.4%
Monsanto Co..................................... 9,400 $ 334,875
PPG Industries, Inc............................. 2,400 150,150
----------
485,025
----------
CHEMICALS (SPECIALTY)--0.0%
USEC, Inc....................................... 1,100 7,700
----------
COMMUNICATIONS EQUIPMENT--3.7%
Lucent Technologies, Inc. (c)................... 40,400 3,022,425
Motorola, Inc................................... 8,900 1,310,525
QUALCOMM, Inc. (b).............................. 3,200 564,000
----------
4,896,950
----------
COMPUTERS (HARDWARE)--4.0%
Compaq Computer Corp............................ 23,600 638,675
Dell Computer Corp. (b)......................... 12,900 657,900
Gateway, Inc. (b)............................... 3,000 216,187
Hewlett-Packard Co.............................. 4,400 501,325
International Business Machines Corp. (c)....... 13,200 1,425,600
Sun Microsystems, Inc. (b)...................... 23,000 1,781,062
----------
5,220,749
----------
COMPUTERS (NETWORKING)--3.4%
3Com Corp. (b).................................. 3,400 159,800
Cisco Systems, Inc. (b)(c)...................... 40,800 4,370,700
----------
4,530,500
----------
COMPUTERS (PERIPHERALS)--1.6%
EMC Corp. (b)................................... 16,500 1,802,625
Lexmark International Group, Inc. Class A (b)... 1,700 153,850
Quantum Corp. - DLT & Storage Systems (b)....... 2,200 33,275
Seagate Technology, Inc. (b).................... 3,100 144,344
----------
2,134,094
----------
COMPUTERS (SOFTWARE & SERVICES)--9.3%
Adobe Systems, Inc.............................. 1,800 121,050
America Online, Inc. (b)........................ 30,300 2,285,756
BMC Software, Inc. (b).......................... 3,800 303,762
Citrix Systems, Inc. (b)........................ 1,200 147,600
Computer Associates International, Inc.......... 5,700 398,644
Exodus Communications, Inc. (b)................. 2,000 177,625
Microsoft Corp. (c)............................. 59,800 6,981,650
Network Associates, Inc. (b).................... 1,900 50,706
Novell, Inc. (b)................................ 4,600 183,137
Oracle Corp. (b)................................ 7,500 840,469
Yahoo!, Inc. (b)................................ 1,700 735,569
----------
12,225,968
----------
CONSUMER FINANCE--0.3%
Countrywide Credit Industries, Inc.............. 1,800 45,450
Household International, Inc.................... 7,700 286,825
Providian Financial Corp........................ 200 18,212
----------
350,487
----------
CONTAINERS & PACKAGING (PAPER)--0.1%
Temple-Inland, Inc.............................. 1,100 72,531
----------
ELECTRIC COMPANIES--1.9%
Allegheny Energy, Inc........................... 2,200 59,262
Ameren Corp..................................... 1,400 45,850
CMS Energy Corp................................. 2,200 68,612
Carolina Power & Light Co....................... 6,000 182,625
Central & South West Corp....................... 10,600 212,000
Cinergy Corp.................................... 3,300 79,612
Constellation Energy Group...................... 2,100 60,900
DTE Energy Co................................... 3,000 94,125
Dominion Resources, Inc......................... 4,600 180,550
Edison International............................ 1,700 44,519
Entergy Corp.................................... 4,800 123,600
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
ELECTRIC COMPANIES--CONTINUED
FPL Group, Inc.................................. 3,700 $ 158,406
GPU, Inc........................................ 2,600 77,837
Nisource........................................ 2,500 44,687
Northern States Power Co........................ 6,800 132,600
PG&E Corp....................................... 7,900 161,950
PP&L Resources, Inc............................. 3,300 75,487
Pinnacle Systems, Inc........................... 1,600 48,900
Reliant Energy, Inc............................. 5,500 125,812
Southern Co. (The).............................. 1,100 25,850
TECO Energy, Inc................................ 2,500 46,406
Texas Utilities Co.............................. 5,700 202,706
Unicom Corp..................................... 5,900 197,650
Wisconsin Energy Corp........................... 2,200 42,350
----------
2,492,296
----------
ELECTRICAL EQUIPMENT--4.4%
Cooper Industries, Inc.......................... 2,200 88,962
Emerson Electric Co............................. 9,100 522,112
General Electric Co. (c)........................ 33,100 5,122,225
Hubbell, Inc.................................... 1,200 32,700
----------
5,765,999
----------
ELECTRONICS (COMPONENT DISTRIBUTORS)--0.1%
Grainger (W.W.), Inc............................ 2,200 105,187
----------
ELECTRONICS (DEFENSE)--0.2%
Raytheon Co., Class A........................... 9,400 233,237
----------
ELECTRONICS (SEMICONDUCTORS)--3.7%
Intel Corp. (c)................................. 43,600 3,588,825
National Semiconductor Corp. (b)................ 2,200 94,188
Texas Instruments, Inc.......................... 10,800 1,046,250
Xilinx, Inc. (b)................................ 4,200 190,969
----------
4,920,232
----------
ENTERTAINMENT--1.1%
Time Warner, Inc................................ 4,000 289,750
Viacom, Inc. Class B (b)........................ 3,900 235,706
Walt Disney Co. (The)........................... 30,300 886,275
----------
1,411,731
----------
EQUIPMENT (SEMICONDUCTOR)--0.5%
Applied Materials, Inc. (b)..................... 5,100 646,106
----------
FINANCIAL (DIVERSIFIED)--3.4%
Ambac Financial Group, Inc...................... 1,700 88,719
American Express Co............................. 500 83,125
Associates First Capital Corp................... 11,900 326,506
CIT Group, Inc. (The) Class A................... 3,900 82,388
Citigroup, Inc. (c)............................. 38,800 2,155,825
FINOVA Group, Inc. (The)........................ 1,000 35,500
Fannie Mae...................................... 16,200 1,011,488
Financial Security Assurance Holdings Ltd....... 300 15,638
Freddie Mac..................................... 12,000 564,750
Morgan Stanley Dean Witter & Co................. 900 128,475
----------
4,492,414
----------
FOODS--0.6%
General Mills, Inc.............................. 5,200 185,900
Heinz (H.J.) Co................................. 6,500 258,781
Hershey Foods Corp.............................. 2,000 95,000
Nabisco Holdings Corp. Class A.................. 800 25,300
Sara Lee Corp................................... 12,900 284,606
----------
849,587
----------
FOOTWEAR--0.0%
Reebok International Ltd. (b)................... 700 5,731
----------
GAMING, LOTTERY & PARI-MUTUEL COMPANIES--0.1%
International Game Technology................... 1,600 32,500
</TABLE>
See Notes to Financial Statements
86
<PAGE>
PHOENIX RESEARCH ENHANCED INDEX SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
GAMING, LOTTERY & PARI-MUTUEL COMPANIES--CONTINUED
MGM Grand, Inc. (b)............................. 100 $ 5,031
Mandalay Resort Group (b)....................... 1,800 36,225
Mirage Resorts, Inc. (b)........................ 4,800 73,500
----------
147,256
----------
HEALTH CARE (DIVERSIFIED)--4.0%
Abbott Laboratories............................. 23,000 835,188
American Home Products Corp..................... 19,800 780,863
Bristol-Myers Squibb Co......................... 29,600 1,899,950
Johnson & Johnson............................... 8,200 763,625
Warner-Lambert Co............................... 12,900 1,056,994
----------
5,336,620
----------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--3.1%
Forest Laboratories, Inc. (b)................... 1,500 92,156
Lilly (Eli) & Co................................ 16,700 1,110,550
Merck & Co., Inc................................ 16,900 1,133,356
Pfizer, Inc..................................... 25,600 830,400
Schering-Plough Corp............................ 20,500 864,844
----------
4,031,306
----------
HEALTH CARE (GENERIC AND OTHER)--0.1%
ALZA Corp. (b).................................. 1,400 48,475
Watson Pharmaceuticals, Inc. (b)................ 1,300 46,556
----------
95,031
----------
HEALTH CARE (HOSPITAL MANAGEMENT)--0.4%
Columbia/HCA Healthcare Corp.................... 12,300 360,544
Tenet Healthcare Corp. (b)...................... 7,200 169,200
----------
529,744
----------
HEALTH CARE (MANAGED CARE)--0.3%
Aetna, Inc...................................... 3,500 195,344
United HealthCare Corp.......................... 2,900 154,063
Wellpoint Health Networks, Inc. (b)............. 1,500 98,906
----------
448,313
----------
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)--0.6%
Becton, Dickinson and Co........................ 5,300 141,775
Boston Scientific Corp. (b)..................... 9,600 210,000
Guidant Corp. (b)............................... 2,100 98,700
Medtronic, Inc.................................. 7,900 287,856
St. Jude Medical, Inc. (b)...................... 1,900 58,306
Water Pik Technologies, Inc..................... 5 48
----------
796,685
----------
HOUSEHOLD FURNISHINGS & APPLIANCES--0.1%
Furniture Brands International, Inc. (b)........ 600 13,200
Leggett & Platt, Inc............................ 4,700 100,756
----------
113,956
----------
HOUSEHOLD PRODUCTS (NON-DURABLE)--2.2%
Clorox Co. (The)................................ 4,300 216,613
Fort James Corp................................. 3,600 98,550
Kimberly-Clark Corp............................. 5,900 384,975
Procter & Gamble Co. (The)...................... 19,600 2,147,425
----------
2,847,563
----------
INSURANCE (LIFE/HEALTH)--0.4%
Jefferson-Pilot Corp............................ 1,300 88,725
Lincoln National Corp........................... 4,500 180,000
Torchmark Corp.................................. 3,300 95,906
UnumProvident Corp.............................. 6,400 205,200
----------
569,831
----------
INSURANCE (MULTI-LINE)--1.3%
American International Group, Inc............... 10,200 1,102,875
CIGNA Corp...................................... 4,300 346,419
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
INSURANCE (MULTI-LINE)--CONTINUED
Hartford Financial Services Group, Inc. (The)... 5,700 $ 270,038
----------
1,719,332
----------
INSURANCE (PROPERTY-CASUALTY)--0.7%
Allstate Corp. (The)............................ 21,600 518,400
Fremont General Corp............................ 800 5,900
MBIA, Inc....................................... 2,400 126,750
Mercury General Corp............................ 1,000 22,250
SAFECO Corp..................................... 3,200 79,600
St. Paul Cos., Inc. (The)....................... 5,500 185,281
Travelers Property Casualty Corp. Class A....... 1,500 51,375
----------
989,556
----------
INSURANCE BROKERS--0.2%
Aon Corp........................................ 6,200 248,000
Marsh & McLennan Cos., Inc...................... 400 38,275
----------
286,275
----------
INVESTMENT BANKING/BROKERAGE--1.2%
AXA Financial, Inc.............................. 4,000 135,500
Bear Stearns Cos., Inc. (The)................... 2,000 85,500
E*TRADE Group, Inc. (b)......................... 1,700 44,413
Goldman Sachs Group, Inc. (The)................. 7,000 659,313
Merrill Lynch & Co., Inc........................ 6,100 509,350
Paine Webber Group, Inc......................... 2,500 97,031
TD Waterhouse Group, Inc. (b)................... 6,200 101,913
----------
1,633,020
----------
IRON & STEEL--0.1%
Allegheny Technologies. Inc..................... 2,900 65,069
USX-U.S. Steel Group............................ 1,900 62,700
----------
127,769
----------
LEISURE TIME (PRODUCTS)--0.1%
Hasbro, Inc..................................... 3,800 72,438
Mattel, Inc..................................... 8,300 108,938
----------
181,376
----------
LODGING-HOTELS--0.0%
Extended Stay America, Inc. (b)................. 500 3,813
Hilton Hotels Corp.............................. 6,500 62,563
----------
66,376
----------
MACHINERY (DIVERSIFIED)--0.4%
Caterpillar, Inc................................ 2,600 122,363
Deere & Co...................................... 5,500 238,563
Ingersoll-Rand Co............................... 3,300 181,706
----------
542,632
----------
MANUFACTURING (DIVERSIFIED)--1.9%
Eaton Corp...................................... 1,700 123,463
Honeywell International, Inc.................... 16,000 923,000
ITT Industries, Inc............................. 2,600 86,938
Johnson Controls, Inc........................... 800 45,500
Tyco International Ltd.......................... 35,100 1,364,513
----------
2,543,414
----------
METALS MINING--0.5%
Freeport-McMoRan Copper & Gold, Inc. Class A
(b)........................................... 4,000 74,250
Freeport-McMoRan Copper & Gold, Inc. Class B
(b)........................................... 3,600 76,050
Level 3 Communications, Inc. (b)................ 5,300 433,938
----------
584,238
----------
NATURAL GAS--0.1%
Columbia Energy Group........................... 1,400 88,550
Consolidated Natural Gas Co..................... 1,500 97,406
----------
185,956
----------
</TABLE>
See Notes to Financial Statements
87
<PAGE>
PHOENIX RESEARCH ENHANCED INDEX SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
OFFICE EQUIPMENT & SUPPLIES--0.0%
Miller (Herman), Inc............................ 1,400 $ 32,200
----------
OIL & GAS (DRILLING & EQUIPMENT)--0.2%
Baker Hughes, Inc............................... 2,300 48,444
Cooper Cameron Corp. (b)........................ 800 39,150
Diamond Offshore Drilling, Inc.................. 1,000 30,563
ENSCO International, Inc........................ 2,200 50,325
Global Marine, Inc. (b)......................... 2,500 41,563
Input/Output, Inc. (b).......................... 200 1,013
R&B Falcon Corp. (b)............................ 3,700 49,025
Smith International, Inc. (b)................... 600 29,813
----------
289,896
----------
OIL & GAS (EXPLORATION & PRODUCTION)--0.0%
Union Pacific Resources Group, Inc.............. 3,600 45,900
----------
OIL & GAS (REFINING & MARKETING)--0.1%
Tosco Corp...................................... 2,400 65,250
Ultramar Diamond Shamrock Corp.................. 1,400 31,763
Valero Energy Corp.............................. 500 9,938
----------
106,951
----------
OIL (DOMESTIC INTEGRATED)--0.4%
Conoco, Inc. Class A............................ 2,300 56,925
Conoco, Inc. Class B............................ 10,000 248,750
Phillips Petroleum Co........................... 3,400 159,800
----------
465,475
----------
OIL (INTERNATIONAL INTEGRATED)--3.4%
Chevron Corp.................................... 9,700 840,263
Exxon Mobil Corp................................ 44,300 3,570,856
Texaco, Inc..................................... 500 27,156
----------
4,438,275
----------
PAPER & FOREST PRODUCTS--0.5%
Bowater, Inc.................................... 900 48,881
Georgia-Pacific Group........................... 2,700 137,025
International Paper Co.......................... 6,500 366,844
Louisiana-Pacific Corp.......................... 1,500 21,375
Smurfit-Stone Container Corp. (b)............... 3,900 95,550
----------
669,675
----------
PERSONAL CARE--0.6%
Gillette Co. (The).............................. 19,500 803,156
----------
PHOTOGRAPHY/IMAGING--0.8%
Eastman Kodak Co................................ 9,400 622,750
Xerox Corp...................................... 18,200 412,913
----------
1,035,663
----------
PUBLISHING (NEWSPAPERS)--0.8%
Gannett Co., Inc................................ 6,700 546,469
Knight-Ridder, Inc.............................. 1,900 113,050
New York Times Co. (The) Class A................ 4,100 201,413
Times Mirror Co. (The) Class A.................. 2,000 134,000
Washington Post Co. (The) Class B............... 21 11,673
----------
1,006,605
----------
RAILROADS--0.4%
Burlington Northern Santa Fe Corp............... 6,300 152,775
CSX Corp........................................ 2,900 90,988
Norfolk Southern Corp........................... 5,000 102,500
Union Pacific Corp.............................. 3,600 157,050
Wisconsin Central Transportation Corp. (b)...... 200 2,688
----------
506,001
----------
REITS--0.1%
Starwood Hotel & Resorts Worldwide, Inc......... 6,100 143,350
----------
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
RESTAURANTS--0.5%
McDonald's Corp................................. 15,100 $ 608,719
----------
RETAIL (BUILDING SUPPLIES)--1.1%
Home Depot, Inc. (The).......................... 16,800 1,151,850
Lowe's Companies., Inc.......................... 4,200 250,950
----------
1,402,800
----------
RETAIL (COMPUTERS & ELECTRONICS)--0.1%
Circuit City Stores-Circuit City Group.......... 2,400 108,150
CompUSA, Inc. (b)............................... 1,000 5,125
----------
113,275
----------
RETAIL (DEPARTMENT STORES)--0.6%
Federated Department Stores, Inc. (b)........... 4,400 222,475
Kohl's Corp. (b)................................ 1,800 129,938
May Department Stores Co........................ 7,000 225,750
Nordstrom, Inc.................................. 2,900 75,944
Penney (J.C.) Co., Inc.......................... 4,400 87,725
----------
741,832
----------
RETAIL (DRUG STORES)--0.1%
CVS Corp........................................ 4,300 171,731
----------
RETAIL (FOOD CHAINS)--0.7%
Albertson's, Inc................................ 7,200 232,200
Kroger Co. (The) (b)............................ 17,600 332,200
Safeway, Inc. (b)............................... 10,800 384,075
----------
948,475
----------
RETAIL (GENERAL MERCHANDISE)--3.1%
Dayton Hudson Corp.............................. 9,500 697,656
Kmart Corp. (b)................................. 10,200 102,638
Sears, Roebuck & Co............................. 8,000 243,500
Wal-Mart Stores, Inc. (c)....................... 44,800 3,096,800
----------
4,140,594
----------
RETAIL (SPECIALTY-APPAREL)--0.8%
Abercrombie & Fitch Co. Class A (b)............. 2,200 58,713
Gap, Inc. (The)................................. 17,700 814,200
TJX Cos., Inc. (The)............................ 6,800 138,975
----------
1,011,888
----------
SAVINGS & LOAN COMPANIES--0.4%
Astoria Financial Corp.......................... 500 15,219
Charter One Financial, Inc...................... 3,300 63,113
Dime Bancorp, Inc............................... 3,300 49,913
Golden State Bancorp, Inc. (b).................. 1,000 17,250
Golden West Financial Corp...................... 2,700 90,450
GreenPoint Financial Corp....................... 1,800 42,863
Ocwen Financial Corp. (b)....................... 300 1,875
Sovereign Bancorp, Inc.......................... 2,600 19,378
Washington Federal, Inc......................... 200 3,950
Washington Mutual, Inc.......................... 10,800 280,800
----------
584,811
----------
SERVICES (ADVERTISING/MARKETING)--0.1%
DoubleClick, Inc. (b)........................... 700 177,144
----------
SERVICES (COMMERCIAL & CONSUMER)--0.5%
Cendant Corp. (b)............................... 24,300 645,469
Service Corp. International..................... 9,500 65,906
----------
711,375
----------
SERVICES (COMPUTER SYSTEMS)--0.3%
Electronic Data Systems Corp.................... 6,700 448,481
----------
SERVICES (DATA PROCESSING)--0.7%
Automatic Data Processing, Inc.................. 9,100 490,263
Equifax, Inc.................................... 3,400 80,113
</TABLE>
See Notes to Financial Statements
88
<PAGE>
PHOENIX RESEARCH ENHANCED INDEX SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
SERVICES (DATA PROCESSING)--CONTINUED
First Data Corp................................. 6,000 $ 295,875
----------
866,251
----------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--0.1%
Sprint Corp. (PCS Group) (b).................... 900 92,250
----------
TELECOMMUNICATIONS (LONG DISTANCE)--2.8%
AT&T Corp....................................... 29,800 1,512,350
MCI WorldCom, Inc. (b)(c)....................... 40,800 2,164,950
----------
3,677,300
----------
TELEPHONE--3.5%
Bell Atlantic Corp.............................. 14,900 917,281
BellSouth Corp.................................. 5,900 276,194
GTE Corp........................................ 16,200 1,143,113
SBC Communications, Inc......................... 47,000 2,291,250
----------
4,627,838
----------
TEXTILES (APPAREL)--0.0%
Jones Apparel Group, Inc. (b)................... 2,400 65,100
----------
TEXTILES (SPECIALTY)--0.0%
Unifi, Inc. (b)................................. 700 8,619
----------
TOBACCO--0.8%
Philip Morris Companies, Inc.................... 44,100 1,022,569
----------
TRUCKERS--0.0%
Ryder System, Inc............................... 600 14,663
----------
TRUCKS & PARTS--0.1%
PACCAR, Inc..................................... 1,900 84,217
----------
WASTE MANAGEMENT--0.2%
Waste Management, Inc........................... 15,400 264,688
----------
TOTAL COMMON STOCKS
(Identified cost $105,199,056)............................ 122,891,945
----------
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
FOREIGN COMMON STOCKS--3.7%
COMMUNICATIONS EQUIPMENT--1.2%
Nortel Networks Corp. (Canada).................. 16,000 $1,616,000
----------
ENTERTAINMENT--0.3%
Seagram Company Ltd. (The) (Canada)............. 10,300 462,856
----------
FOODS--0.4%
Unilever NV (Netherlands)....................... 9,200 500,825
----------
OIL (INTERNATIONAL INTEGRATED)--1.4%
Royal Dutch Petroleum Co. NY Registered Shares
(Netherlands)................................. 30,000 1,813,125
----------
TELECOMMUNICATIONS (LONG DISTANCE)--0.4%
Global Crossing Holdings Ltd. (b) (Bermuda)..... 10,900 545,000
----------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $4,247,517).............................. 4,937,806
----------
TOTAL LONG-TERM INVESTMENTS--97.1%
(Identified cost $109,666,265)............................ 128,048,926
----------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000)
----------- ------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--2.9%
COMMERCIAL PAPER--2.9%
Koch Industries, Inc. 4.50%,
1/3/00........................... A-1+ $3,800 3,799,050
-----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $3,799,050)............................. 3,799,050
-----------
TOTAL INVESTMENTS--100.0%
(Identified cost $113,465,315)........................... 131,847,976(a)
Cash and receivables, less liabilities--0.0%............. 12,024
-----------
NET ASSETS--100.0%......................................... $131,860,000
===========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $28,910,496 and gross depreciation of $10,565,371 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purposes
was $113,502,851.
(b) Non-income producing.
(c) All or a portion segregated as collateral.
</TABLE>
See Notes to Financial Statements
89
<PAGE>
PHOENIX RESEARCH ENHANCED INDEX SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$113,465,315)............................................. $131,847,976
Receivables
Dividends and interest.................................... 145,208
Fund shares sold.......................................... 142,732
Investment securities sold................................ 22,179
Variation margin for futures contracts.................... 9,350
Prepaid expenses............................................ 1,027
------------
Total assets............................................ 132,168,472
------------
LIABILITIES
Payables
Custodian................................................. 972
Fund shares repurchased................................... 188,912
Financial agent fee....................................... 13,770
Investment advisory fee................................... 13,573
Trustees' fee............................................. 6,958
Accrued expenses............................................ 84,287
------------
Total liabilities....................................... 308,472
------------
NET ASSETS.................................................. $131,860,000
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $110,586,386
Undistributed net investment income....................... 4,777
Accumulated net realized gain............................. 2,764,711
Net unrealized appreciation............................... 18,504,126
------------
NET ASSETS.................................................. $131,860,000
============
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 9,005,985
============
Net asset value and offering price per share................ $ 14.64
============
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 1,449,878
Interest.................................................. 153,701
Foreign taxes withheld.................................... (27,639)
-----------
Total investment income................................. 1,575,940
-----------
EXPENSES
Investment advisory fee................................... 471,493
Financial agent fee....................................... 134,375
Custodian................................................. 76,512
Printing.................................................. 37,120
Professional.............................................. 27,132
Trustees.................................................. 19,286
Miscellaneous............................................. 16,885
-----------
Total expenses.......................................... 782,803
Less expenses borne by investment adviser............... (205,209)
Custodian fees paid indirectly.......................... (1,325)
-----------
Net expenses............................................ 576,269
-----------
NET INVESTMENT INCOME....................................... 999,671
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 8,723,360
Net realized gain on futures contracts.................... 411,772
Net change in unrealized appreciation (depreciation) on
investments............................................. 7,891,861
-----------
NET GAIN ON INVESTMENTS..................................... 17,026,993
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $18,026,664
===========
</TABLE>
See Notes to Financial Statements
90
<PAGE>
PHOENIX RESEARCH ENHANCED INDEX SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
12/31/99 12/31/98
------------ -----------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 999,671 $ 523,699
Net realized gain (loss).................................. 9,135,132 3,008,093
Net change in unrealized appreciation (depreciation)...... 7,891,861 9,780,453
------------ -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 18,026,664 13,312,245
------------ -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (994,894) (532,936)
Net realized gains........................................ (6,542,091) (2,994,712)
------------ -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (7,536,985) (3,527,648)
------------ -----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (5,584,453 and 5,285,851
shares, respectively)................................... 78,731,870 63,644,481
Net asset value of shares issued from reinvestment of
distributions (517,025 and 271,800 shares,
respectively)........................................... 7,536,985 3,527,648
Cost of shares repurchased (2,409,378 and 3,186,084
shares, respectively)................................... (34,420,459) (38,286,173)
------------ -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 51,848,396 28,885,956
------------ -----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 62,338,075 38,670,553
NET ASSETS
Beginning of period....................................... 69,521,925 30,851,372
------------ -----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $4,777 AND $0, RESPECTIVELY)........... $131,860,000 $69,521,925
============ ===========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM
INCEPTION
7/15/97
YEAR ENDED DECEMBER 31, TO
1999 1998 12/31/97
------------ --------- ---------
<S> <C> <C> <C>
Net asset value, beginning of period........................ $13.08 $10.49 $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.12 0.12 0.05
Net realized and unrealized gain (loss)................... 2.33 3.19 0.54
------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS........................ 2.45 3.31 0.59
------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.12) (0.12) (0.05)
Dividends from net realized gains......................... (0.77) (0.60) (0.05)
------ ------ ------
TOTAL DISTRIBUTIONS..................................... (0.89) (0.72) (0.10)
------ ------ ------
CHANGE IN NET ASSET VALUE................................... 1.56 2.59 0.49
====== ====== ======
NET ASSET VALUE, END OF PERIOD.............................. $14.64 $13.08 $10.49
====== ====== ======
Total return................................................ 18.86% 31.68% 5.83%(3)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $131,860 $69,522 $30,851
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(2)..................................... 0.55% 0.55% 0.55%(1)
Net investment income..................................... 0.95% 1.08% 1.46%(1)
Portfolio turnover rate..................................... 45% 45% 9%(3)
</TABLE>
(1) Annualized.
(2) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 0.75%,
0.82% and 1.05% for the periods ended December 31, 1999, 1998 and 1997,
respectively.
(3) Not annualized.
See Notes to Financial Statements
91
<PAGE>
PHOENIX-BANKERS TRUST DOW 30 SERIES
INVESTOR PROFILE
The Fund is appropriate for an investor who seeks to track the total return
of the Dow Jones Industrial Average-Registered Trademark- before fund expenses.
INVESTMENT ADVISOR'S REPORT
The Dow Jones Industrial Average-Registered Trademark- returned 11.22% for
the 4th quarter 1999 and 25.22% for full year 1999.
Leading stocks for the quarter included Home Depot, up 50.27%, Wal-Mart, up
45.34% and Alcoa, up 33.74%. Lagging stocks for the quarter included Philip
Morris, down 32.72%, Caterpillar, down 14.14%, and Eastman Kodak, down 12.40%.
There were a number of index changes for the 4th quarter. Microsoft, Intel,
Home Depot and SBC Communications replaced Chevron, Goodyear Tire & Rubber,
Sears, Roebuck and Union Carbide. Name changes within the index included Exxon
Corp, which was renamed Exxon Mobil, and AlliedSignal, which was renamed
Honeywell International.
OUTLOOK
Economy's ability to grow quickly (and generate strong profits) w/o
inflation has been the driving force behind the bull market in recent years.
Economic fundamentals to be much less supportive of equities in the next year or
two due to a gradual slowdown in economic growth, modest pickup in inflation and
pressure on profit margins from rising labor costs and higher interest rates. We
don't see a sharp correction in equities, because we expect a reasonable "soft
landing" for the economy. We also see the economy retaining many of its
structural improvements (e.g., faster productivity growth and less volatile
economic cycles).
92
<PAGE>
PHOENIX-BANKERS TRUST DOW 30 SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
----------- ----------
<S> <C> <C> <C>
COMMON STOCKS--98.1%
AEROSPACE/DEFENSE--1.8%
Boeing Co. (The).............................. 2,179 $ 90,565
----------
ALUMINUM--3.5%
Alcoa, Inc.................................... 2,179 180,857
----------
AUTOMOBILES--3.1%
General Motors Corp........................... 2,179 158,386
----------
BANKS (MONEY CENTER)--5.4%
Morgan (J.P.) & Co., Inc...................... 2,179 275,916
----------
BEVERAGES (NON-ALCOHOLIC)--2.5%
Coca-Cola Co. (The)........................... 2,179 126,927
----------
CHEMICALS--2.8%
Du Pont (E.I.) de Nemours & Co................ 2,179 143,541
----------
COMPUTERS (HARDWARE)--9.4%
Hewlett-Packard Co............................ 2,179 248,270
International Business Machines Corp.......... 2,179 235,332
----------
483,602
----------
COMPUTERS (SOFTWARE & SERVICES)--4.9%
Microsoft Corp. (b)........................... 2,179 254,398
----------
ELECTRICAL EQUIPMENT--6.6%
General Electric Co........................... 2,179 337,200
----------
ELECTRONICS (SEMICONDUCTORS)--3.5%
Intel Corp.................................... 2,179 179,359
----------
ENTERTAINMENT--1.2%
Walt Disney Co. (The)......................... 2,179 63,736
----------
FINANCIAL (DIVERSIFIED)--9.4%
American Express Co........................... 2,179 362,259
Citigroup, Inc................................ 2,179 121,071
----------
483,330
----------
HEALTH CARE (DIVERSIFIED)--3.9%
Johnson & Johnson............................. 2,179 202,919
----------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--2.8%
Merck & Co., Inc.............................. 2,179 146,129
----------
HOUSEHOLD PRODUCTS (NON-DURABLE)--4.6%
Procter & Gamble Co. (The).................... 2,179 238,737
----------
<CAPTION>
SHARES VALUE
----------- ----------
<S> <C> <C> <C>
MACHINERY (DIVERSIFIED)--2.0%
Caterpillar, Inc.............................. 2,179 $ 102,549
----------
MANUFACTURING (DIVERSIFIED)--9.3%
Honeywell International, Inc.................. 2,179 125,701
Minnesota Mining and Manufacturing Co......... 2,179 213,270
United Technologies Corp...................... 2,179 141,635
----------
480,606
----------
OIL (INTERNATIONAL INTEGRATED)--3.4%
Exxon Mobil Corp.............................. 2,179 175,546
----------
PAPER & FOREST PRODUCTS--2.4%
International Paper Co........................ 2,179 122,977
----------
PHOTOGRAPHY/IMAGING--2.8%
Eastman Kodak Co.............................. 2,179 144,359
----------
RESTAURANTS--1.7%
McDonald's Corp............................... 2,179 87,841
----------
RETAIL (BUILDING SUPPLIES)--2.9%
Home Depot, Inc. (The)........................ 2,179 149,432
----------
RETAIL (GENERAL MERCHANDISE)--2.9%
Wal-Mart Stores, Inc.......................... 2,179 150,623
----------
TELECOMMUNICATIONS (LONG DISTANCE)--2.2%
AT&T Corp..................................... 2,179 110,584
----------
TELEPHONE--2.1%
SBC Communications, Inc....................... 2,179 106,226
----------
TOBACCO--1.0%
Philip Morris Companies, Inc.................. 2,179 50,525
----------
TOTAL COMMON STOCKS
(Identified cost $4,931,947)................................ 5,046,870
----------
UNIT INVESTMENT TRUSTS--1.8%
Diamonds Trust, Series I...................... 809 93,187
----------
TOTAL UNIT INVESTMENT TRUSTS
(Identified cost $92,614)................................... 93,187
----------
TOTAL INVESTMENTS--99.9%
(Identified cost $5,024,561)................................ 5,140,057(a)
Cash and receivables, less liabilities--0.1%................ 2,811
----------
NET ASSETS--100.0%............................................ $5,142,868
==========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $177,532 and gross depreciation of $62,036 for federal
income tax purposes. At December 31, 1999, the aggregate
cost of securities for federal income tax purposes was
$5,024,561.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
93
<PAGE>
PHOENIX-BANKERS TRUST DOW 30 SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$5,024,561)............................................... $5,140,057
Cash........................................................ 3,133
Receivables
Investment securities sold................................ 72,492
Receivable from adviser................................... 15,404
Dividends and interest.................................... 3,901
----------
Total assets............................................ 5,234,987
----------
LIABILITIES
Payables
Investment securities purchased........................... 75,608
Trustees' fee............................................. 1,310
Financial agent fee....................................... 93
Accrued expenses............................................ 15,108
----------
Total liabilities....................................... 92,119
----------
NET ASSETS.................................................. $5,142,868
==========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $5,022,792
Undistributed net investment income....................... 74
Accumulated net realized gain............................. 4,506
Net unrealized appreciation............................... 115,496
----------
NET ASSETS.................................................. $5,142,868
==========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 502,240
==========
Net asset value and offering price per share................ $ 10.24
==========
</TABLE>
STATEMENT OF OPERATIONS
FROM INCEPTION DECEMBER 15, 1999 TO DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 3,901
Interest.................................................. 3,299
--------
Total investment income................................. 7,200
--------
EXPENSES
Investment advisory fee................................... 775
Financial agent fee....................................... 93
Professional.............................................. 10,000
Printing.................................................. 4,478
Trustees.................................................. 1,310
Custodian................................................. 364
Miscellaneous............................................. 266
--------
Total expenses.......................................... 17,286
Less expenses borne by investment adviser............... (16,179)
--------
Net expenses............................................ 1,107
--------
NET INVESTMENT INCOME....................................... 6,093
--------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 4,506
Net change in unrealized appreciation (depreciation) on
investments............................................. 115,496
--------
NET GAIN ON INVESTMENTS..................................... 120,002
--------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $126,095
========
</TABLE>
See Notes to Financial Statements
94
<PAGE>
PHOENIX-BANKERS TRUST DOW 30 SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 6,093
Net realized gain (loss).................................. 4,506
Net change in unrealized appreciation (depreciation)...... 115,496
----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 126,095
----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (6,019)
Net realized gains........................................ --
----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (6,019)
----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (501,651 shares)............ 5,016,781
Net asset value of shares issued from reinvestment of
distributions (590 shares).............................. 6,019
Cost of shares repurchased (1 shares)..................... (8)
----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 5,022,792
----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 5,142,868
NET ASSETS
Beginning of period....................................... --
----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME OF $74).......................................... $5,142,868
==========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
Net asset value, beginning of period........................ $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.01
Net realized and unrealized gain (loss)................... 0.24
------
TOTAL FROM INVESTMENT OPERATIONS........................ 0.25
------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.01)
------
TOTAL DISTRIBUTIONS..................................... (0.01)
------
CHANGE IN NET ASSET VALUE................................... 0.24
------
NET ASSET VALUE, END OF PERIOD.............................. $10.24
======
Total return................................................ 2.52%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $5,143
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3)..................................... 0.50%(1)
Net investment income..................................... 2.75%(1)
Portfolio turnover rate..................................... 1.41%(2)
</TABLE>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 7.81% for
the period ended December 31, 1999.
See Notes to Financial Statements
95
<PAGE>
PHOENIX-FEDERATED U.S. GOVERNMENT BOND SERIES
INVESTOR PROFILE
The fund is appropriate for longer-term investors who want the relative
credit safety of government bonds and are comfortable with fluctuations in the
value of their investments. Investors should note that an investment in this
fund is not insured or guaranteed by the Federal Deposit Insurance Corporation
or any other government agency.
INVESTMENT ADVISOR'S REPORT
U.S. Treasury yields continued to rise and ended the fourth quarter at their
highest levels of the year. 1999 was the worst year for the Treasury market
since 1994 and the worst year ever for the 30-year Treasury bond. Yields of
10-year and 30-year Treasury securities ended the fourth quarter at 6.44% and
6.48%, respectively, versus 5.88% and 6.05% at the end of the third quarter and
4.65% and 5.09% at the end of 1998. Stronger than expected U.S. economic growth
combined with rebounding global economies continued to fuel market fears of
higher inflation and market expectations of a tighter Fed monetary policy. The
Fed Funds target rate was increased by another 25 basis points to 5.50% in
mid-November, reversing the last of the three Fed easings implemented during
Fall 1998. The 2- to 30-year coupon curve remained within a narrow range since
the Fed tightened in mid-November. However, the 10- to 30-year portion of the
curve flattened significantly as a result of the reopening of the 10-year and
elimination of the 30-year in the November Treasury refunding. The fund's
average duration remained at or below its neutral target and ended the year at
9.8 years.
OUTLOOK
With the Fed in a tightening mode, the coupon curve should have a flattening
bias. Further monetary policy tightening at the early February FOMC meeting is
highly likely and is currently reflected in the front end of the yield curve.
However, in the absence of concrete evidence of rising inflation, Fed
tightenings will be more moderate than aggressive.
96
<PAGE>
PHOENIX-FEDERATED U.S. GOVERNMENT BOND SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ----------
<S> <C> <C> <C>
U.S. GOVERNMENT SECURITIES--78.4%
U.S. TREASURY BONDS--78.4%
U.S. Treasury Bonds 9.25%, 2/15/16... AAA $400 $ 493,855
U.S. Treasury Bonds 8.75%, 5/15/17... AAA 400 477,563
U.S. Treasury Bonds 9.125%,
5/15/18............................ AAA 400 495,428
U.S. Treasury Bonds 8.875%,
2/15/19............................ AAA 400 486,779
U.S. Treasury Bonds 8.125%,
8/15/19............................ AAA 400 455,701
U.S. Treasury Bonds 8.50%, 2/15/20... AAA 400 472,664
U.S. Treasury Bonds 8.75%, 5/15/20... AAA 400 484,001
U.S. Treasury Bonds 8.75%, 8/15/20... AAA 350 423,928
U.S. Treasury Bonds 6.125%,
8/15/29............................ AAA 200 190,557
----------
3,980,476
----------
TOTAL U.S. GOVERNMENT SECURITIES
(Identified cost $4,058,914)................................. 3,980,476
----------
AGENCY MORTGAGE-BACKED SECURITIES--14.1%
Freddie Mac 6.75%, 9/15/29........... AAA 750 714,026
----------
TOTAL AGENCY MORTGAGE-BACKED SECURITIES
(Identified cost $723,624)................................... 714,026
----------
TOTAL LONG-TERM INVESTMENTS--92.5%
(Identified cost $4,782,538)................................. 4,694,502
----------
<CAPTION>
PAR
VALUE
(000) VALUE
-------- ----------
SHORT-TERM OBLIGATIONS--5.0%
<S> <C> <C> <C>
REPURCHASE AGREEMENT--5.0%
First Union Capital repurchase
agreement 3.25%, dated 12/31/99 due
1/3/00, repurchase price $255,069
collateralized by U.S. Treasury
Notes 4.50%-7.25%, 9/30/00-5/15/04
market value $259,870 (b).......... $255 $ 255,000
----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $255,000)................................... 255,000
----------
TOTAL INVESTMENTS--97.5%
(Identified cost $5,037,538)................................. 4,949,502(a)
Cash and receivables, less liabilities--2.5%................. 126,734
----------
NET ASSETS--100.0%............................................. $5,076,236
==========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized depreciation
of investment securities is comprised of gross appreciation
of $0 and gross depreciation of $88,036 for federal income
tax purposes. At December 31,1999, the aggregate cost of
securities for federal income tax purposes was $5,037,538.
(b) The repurchase agreement is fully collateralized by U.S.
Treasury Notes based on market prices at the date of the
portfolio. The investment in the repurchase agreement is
through participation in a joint account.
</TABLE>
See Notes to Financial Statements
97
<PAGE>
PHOENIX-FEDERATED U.S. GOVERNMENT BOND SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$5,037,538)............................................... $4,949,502
Cash........................................................ 1,692
Receivables
Dividends and Interest.................................... 88,072
Fund shares sold.......................................... 38,596
Receivable from adviser................................... 14,885
----------
Total assets............................................ 5,092,747
----------
LIABILITIES
Payables
Trustees' fee............................................. 1,310
Financial agent fee....................................... 93
Accrued expenses............................................ 15,108
----------
Total liabilities....................................... 16,511
----------
NET ASSETS.................................................. $5,076,236
==========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $5,164,245
Undistributed net investment income....................... 27
Net unrealized depreciation............................... (88,036)
----------
NET ASSETS.................................................. $5,076,236
==========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 516,660
==========
Net asset value and offering price per share................ $9.83
==========
</TABLE>
STATEMENT OF OPERATIONS
FROM INCEPTION DECEMBER 15, 1999 TO DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $ 15,970
--------
Total investment income................................. 15,970
--------
EXPENSES
Investment advisory fee................................... 1,301
Financial agent fee....................................... 93
Professional.............................................. 10,000
Printing.................................................. 4,478
Trustees.................................................. 1,310
Custodian................................................. 364
Miscellaneous............................................. 266
--------
Total expenses.......................................... 17,812
Less expenses borne by investment adviser............... (16,185)
--------
Net expenses............................................ 1,627
--------
NET INVESTMENT INCOME....................................... 14,343
--------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... --
Net change in unrealized appreciation (depreciation) on
investments............................................. (88,036)
--------
NET LOSS ON INVESTMENTS..................................... (88,036)
--------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $(73,693)
========
</TABLE>
See Notes to Financial Statements
98
<PAGE>
PHOENIX-FEDERATED U.S. GOVERNMENT BOND SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 14,343
Net realized gain (loss).................................. --
Net change in unrealized appreciation (depreciation)...... (88,036)
----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. (73,693)
----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (14,316)
Net realized gains........................................ --
----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (14,316)
----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (515,209 shares)............ 5,149,929
Net asset value of shares issued from reinvestment of
distributions(1,451 shares)............................. 14,316
Cost of shares repurchased (0 shares)..................... --
----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 5,164,245
----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 5,076,236
NET ASSETS
Beginning of period....................................... --
----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $27)................................... $5,076,236
==========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
Net asset value, beginning of period........................ $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.03
Net realized and unrealized gain (loss)................... (0.17)
------
TOTAL FROM INVESTMENT OPERATIONS........................ (0.14)
------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.03)
------
TOTAL DISTRIBUTIONS..................................... (0.03)
------
CHANGE IN NET ASSET VALUE................................... (0.17)
------
NET ASSET VALUE, END OF PERIOD.............................. $ 9.83
======
Total return................................................ (1.47)%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $5,076
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3)..................................... 0.75%(1)
Net investment income..................................... 6.61%(1)
Portfolio turnover rate..................................... 0%(2)
</TABLE>
(1) Annualized
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 8.21% for
the period ended December 31, 1999.
See Notes to Financial Statements
99
<PAGE>
PHOENIX-JANUS EQUITY INCOME SERIES
INVESTOR PROFILE
The Fund is appropriate for more conservative investors seeking long-term
capital appreciation, consistent with the preservation of capital and balanced
by current income.
INVESTMENT ADVISOR'S REPORT
The Fund, which was opened on December 20, applies a diversified strategy
that allows Portfolio Manager Karen L. Reidy to invest across a wide spectrum of
equity and fixed-income investment options. Karen selects compelling equity
investments from the more conservative end of what Janus' never-ending research
uncovers. At the core of Janus' investment approach is rigorous numbers
crunching, creating highly detailed financial models. But understanding what's
truly driving the numbers means getting out on the road to visit companies on
their home turf. Then we take our research a step further, interviewing
customers, suppliers and even competitors, which offers us a more complete
understanding of each opportunity. Through this constant, hands-on research,
we're constantly digging deeper to uncover an information edge. Among our
fixed-income holdings, we also work to increase total return by carefully
selecting convertible bonds. By adding convertibles, we can participate in a
stock's upside while the bond's yield helps limit downside volatility.
Additionally, we limit the Fund's interest rate volatility and do not make
interest rate bets. Rather, we mix together an assortment of debt instruments
whose underlying companies possess clear catalysts that will drive future
earnings. These include investment grade and high-yield bonds that bolster the
Fund's yield and offer compelling upside potential.
OUTLOOK
Looking ahead, we are slightly concerned about what the market may have in
store. Long-term interest rates now stand at their highest levels in over two
years and, with continued strength in the U.S. economy, the Federal Reserve may
become even more vigilant in its fight against inflation. Therefore, we will
almost certainly see heightened volatility in the coming year. Regardless of
what the future holds, it's business as usual here at Janus. Rest assured, we
will continue to travel extensively, visiting our companies in their home
offices. By looking for critical data points that others have missed or simply
overlooked, we uncover a substantive information edge that bolsters our
conviction in each and every holding.
100
<PAGE>
PHOENIX-JANUS EQUITY INCOME SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
COMMON STOCKS--69.8%
BANKS (MAJOR REGIONAL)--0.4%
Bank of New York Co., Inc. (The)............... 255 $ 10,200
----------
BANKS (MONEY CENTER)--0.9%
Firstar Corp................................... 945 19,963
----------
BEVERAGES (ALCOHOLIC)--1.0%
Anheuser-Busch Cos., Inc....................... 315 22,326
----------
BROADCASTING (TELEVISION, RADIO & CABLE)--12.3%
AT&T Corp.-Liberty Media Group Class A (b)..... 1,080 61,290
Comcast Corp. Special Class A.................. 1,245 62,561
Cox Communications, Inc. Class A (b)........... 600 30,900
Hispanic Broadcasting Corp. (b)................ 390 35,965
Infinity Broadcasting Corp. Class A (b)........ 985 35,645
Univision Communications, Inc. Class A (b)..... 550 56,203
----------
282,564
----------
COMMUNICATIONS EQUIPMENT--1.2%
Lucent Technologies, Inc....................... 365 27,307
----------
COMPUTERS (NETWORKING)--2.9%
Cisco Systems, Inc. (b)........................ 615 65,882
----------
COMPUTERS (PERIPHERALS)--2.8%
EMC Corp. (b).................................. 595 65,004
----------
COMPUTERS (SOFTWARE & SERVICES)--3.1%
BEA Systems, Inc. (b).......................... 95 6,644
Microsoft Corp. (b)............................ 480 56,040
VeriSign, Inc. (b)............................. 45 8,584
----------
71,268
----------
ELECTRICAL EQUIPMENT--4.0%
General Electric Co............................ 600 92,850
----------
ELECTRONICS (SEMICONDUCTORS)--5.4%
Linear Technology Corp......................... 555 39,717
Maxim Integrated Products, Inc. (b)............ 940 44,356
Texas Instruments, Inc......................... 415 40,203
----------
124,276
----------
ENTERTAINMENT--5.0%
Time Warner, Inc............................... 405 29,337
Viacom, Inc. Class B (b)....................... 1,425 86,123
----------
115,460
----------
FINANCIAL (DIVERSIFIED)--5.5%
American Express Co............................ 370 61,512
Citigroup, Inc................................. 750 41,672
Fannie Mae..................................... 360 22,477
----------
125,661
----------
HEALTH CARE (DIVERSIFIED)--1.5%
Allergan, Inc.................................. 705 35,074
----------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--2.4%
Genentech, Inc. (b)............................ 305 41,022
Schering-Plough Corp........................... 360 15,187
----------
56,209
----------
INSURANCE (MULTI-LINE)--1.7%
American International Group, Inc.............. 365 39,466
----------
INVESTMENT BANKING/BROKERAGE--1.3%
Schwab (Charles) Corp. (The)................... 780 29,932
----------
NATURAL GAS--2.1%
Enron Corp..................................... 1,090 48,369
----------
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
RESTAURANTS--1.3%
McDonald's Corp................................ 725 $ 29,227
----------
RETAIL (BUILDING SUPPLIES)--2.2%
Home Depot, Inc. (The)......................... 728 49,879
----------
RETAIL (GENERAL MERCHANDISE)--1.9%
Costco Wholesale Corp. (b)..................... 230 20,987
Wal-Mart Stores, Inc........................... 325 22,466
----------
43,453
----------
RETAIL (HOME SHOPPING)--0.6%
Insight Enterprises, Inc. (b).................. 345 14,016
----------
SERVICES (DATA PROCESSING)--3.0%
Automatic Data Processing, Inc................. 990 53,336
Paychex, Inc................................... 380 15,200
----------
68,536
----------
SHIPPING--1.0%
Royal Caribbean Cruises Ltd.................... 485 23,917
----------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--5.0%
Nextel Communications, Inc. Class A (b)........ 390 40,219
Omnipoint Corp. (b)............................ 390 47,044
Sprint Corp. (PCS Group) (b)................... 275 28,188
----------
115,451
----------
TELEPHONE--1.3%
Alltel Corp.................................... 135 11,163
Centurytel, Inc................................ 415 19,661
----------
30,824
----------
TOTAL COMMON STOCKS
(Identified cost $1,517,569).............................. 1,607,114
----------
FOREIGN COMMON STOCKS--8.2%
COMMUNICATIONS EQUIPMENT--3.8%
Nokia Oyj (Finland)............................ 46 8,339
Nokia Oyj Sponsored ADR (Finland).............. 420 79,800
----------
88,139
----------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--0.9%
AstraZeneca Group PLC Sponsored ADR (United
Kingdom)..................................... 485 20,249
----------
INSURANCE (LIFE/HEALTH)--2.4%
Prudential PLC (United Kingdom)................ 2,787 54,923
----------
TELECOMMUNICATIONS (LONG DISTANCE)--0.1%
Telefonica SA Sponsored ADR (Spain) (b)........ 20 1,576
----------
TELEPHONE--1.0%
Telefonica SA (Spain) (b)...................... 959 23,953
----------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $169,066)................................ 188,840
----------
PREFERRED STOCKS--1.3%
BROADCASTING (TELEVISION, RADIO & CABLE)--0.6%
Comcast Corp. Pfd. 2%.......................... 150 14,250
----------
MISCELLANEOUS--0.7%
Houston Industries, Inc. Pfd. 7%............... 125 15,062
----------
TOTAL PREFERRED STOCKS
(Identified cost $28,419)................................. 29,312
----------
</TABLE>
See Notes to Financial Statements
101
<PAGE>
PHOENIX-JANUS EQUITY INCOME SERIES
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
FOREIGN PREFERRED STOCKS--0.9%
AUTOMOBILES--0.9%
Porsche AG (Germany)........................... 8 $ 21,754
----------
TOTAL FOREIGN PREFERRED STOCKS
(Identified cost $21,627)................................. 21,754
----------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000)
----------- --------
<S> <C> <C> <C>
CONVERTIBLE BONDS--2.6%
COMPUTERS (PERIPHERALS)--0.6%
EMC Corp. Cv. 6%, 5/15/04.............. BBB- $ 10 13,688
---------
COMPUTERS (SOFTWARE & SERVICES)--0.6%
BEA Systems, Inc. Cv. 144A 4%, 12/15/06
(c).................................. NR 13 15,161
---------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--0.7%
Nextel Communications, Inc. Cv. 4.75%,
7/1/07............................... B 7 15,846
---------
TELECOMMUNICATIONS (LONG DISTANCE)--0.7%
NTL Corp. Cv. 7%, 12/15/08............. CCC+ 6 15,840
---------
TOTAL CONVERTIBLE BONDS
(Identified cost $54,408)...................................... 60,535
---------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ----------
<S> <C> <C> <C>
FOREIGN CONVERTIBLE BONDS--0.9%
UNITED KINGDOM--0.9%
Telewest PLC Cv. 144A 5.25%, 2/19/07
(c)(d)............................... B+ $ 11 $ 20,256
----------
TOTAL FOREIGN CONVERTIBLE BONDS
(Identified cost $20,470)...................................... 20,256
----------
TOTAL LONG-TERM INVESTMENTS--83.7%
(Identified cost $1,811,559)................................... 1,927,811
----------
SHORT-TERM OBLIGATIONS--20.8%
FEDERAL AGENCY SECURITIES--20.8%
Freddie Mac Discount Note 1.50%,
1/3/00............................... 480 479,960
----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $479,960)..................................... 479,960
----------
TOTAL INVESTMENTS--104.5%
(Identified cost $2,291,519)................................... 2,407,771(a)
Cash and receivables, less liabilities--(4.5%)................. (103,657)
----------
NET ASSETS--100.0%............................................... $2,304,114
==========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $124,462 and gross depreciation of $8,210 for federal
income tax purposes. At December 31,1999, the aggregate cost
of securities for federal income tax purpose was $2,291,519.
(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 December 31, 1999, these securities
amounted to a value of $35,417 or 1.5% of net assets.
(d) Par value represents British Pounds.
</TABLE>
See Notes to Financial Statements
102
<PAGE>
PHOENIX-JANUS EQUITY INCOME SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$2,291,519)............................................... $2,407,771
Cash........................................................ 2,503
Foreign currency at value (identified cost $20,929)......... 20,930
Receivables
Fund shares sold.......................................... 47,410
Investment securities sold................................ 23,107
Receivable from adviser................................... 15,527
Interest and dividends.................................... 959
----------
Total assets............................................ 2,518,207
----------
LIABILITIES
Payables
Investment securities purchased........................... 197,650
Trustees' fee............................................. 1,297
Financial agent fee....................................... 37
Accrued expenses............................................ 15,109
----------
Total liabilities....................................... 214,093
----------
NET ASSETS.................................................. $2,304,114
==========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $2,184,738
Undistributed net investment income....................... 1,731
Accumulated net realized gain............................. 1,392
Net unrealized appreciation............................... 116,253
----------
NET ASSETS.................................................. $2,304,114
==========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 217,671
==========
Net asset value and offering price per share................ $ 10.59
==========
</TABLE>
STATEMENT OF OPERATIONS
FROM INCEPTION DECEMBER 15, 1999 TO DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $ 2,193
Dividends................................................. 453
--------
Total investment income................................. 2,646
--------
EXPENSES
Investment advisory fee................................... 778
Financial agent fee....................................... 37
Professional.............................................. 10,000
Printing.................................................. 4,478
Trustees.................................................. 1,297
Custodian................................................. 364
Miscellaneous............................................. 266
--------
Total expenses.......................................... 17,220
Less expenses borne by investment adviser............... (16,305)
--------
Net expenses............................................ 915
--------
NET INVESTMENT INCOME....................................... 1,731
--------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 1,392
Net change in unrealized appreciation (depreciation) on
investments............................................. 116,252
Net change in unrealized appreciation (depreciation) on
foreign currency and foreign currency transactions...... 1
--------
NET GAIN ON INVESTMENTS..................................... 117,645
--------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $119,376
========
</TABLE>
See Notes to Financial Statements
103
<PAGE>
PHOENIX-JANUS EQUITY INCOME SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
-------------------
<S> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 1,731
Net realized gain (loss).................................. 1,392
Net change in unrealized appreciation (depreciation)...... 116,253
----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 119,376
----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... --
Net realized gains........................................ --
----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ --
----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (217,672 shares)............ 2,184,748
Net asset value of shares issued from reinvestment of
distributions (0 shares)................................ --
Cost of shares repurchased (1 share)...................... (10)
----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 2,184,738
----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 2,304,114
NET ASSETS
Beginning of period....................................... --
----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $1,731................................. $2,304,114
==========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
Net asset value, beginning of period........................ $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.01
Net realized and unrealized gain (loss)................... 0.58
------
TOTAL FROM INVESTMENT OPERATIONS........................ 0.59
------
LESS DISTRIBUTIONS
Dividends from net investment income...................... --
------
TOTAL DISTRIBUTIONS..................................... --
------
CHANGE IN NET ASSET VALUE................................... 0.59
------
NET ASSET VALUE, END OF PERIOD.............................. $10.59
======
Total return................................................ 5.86%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $2,304
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3)..................................... 1.00%(1)
Net investment income..................................... 1.89%(1)
Portfolio turnover rate..................................... 11%(2)
</TABLE>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 18.81% for
the period ended December 31, 1999.
See Notes to Financial Statements
104
<PAGE>
PHOENIX-JANUS FLEXIBLE INCOME SERIES
INVESTOR PROFILE
The Fund is appropriate for a conservative investor seeking a diversified
bond portfolio that provides current income with minimal risk to capital.
INVESTMENT ADVISOR'S REPORT
The Fund, which was available to investors on December 20, 1999, follows a
flexible income strategy that invests in individual holdings from across a wide
range of income-producing securities. While the allocation between Treasuries,
investment-grade corporate bonds and high-yield risk securities may shift in
response to economic or market conditions, each position is selected one at a
time through rigorous credit analysis and extensive hands-on research. Before we
invest in a credit, we get to know the company from the ground up. We test its
products, visit its stores, and meet repeatedly with management as well as
people at all levels of the organization. We build exacting financial models to
forecast every aspect of the company's business over a three- to five-year time
horizon. This level of analysis is rare in fixed-income investing, and it gives
us the confidence to invest in companies, especially in the high-yield universe,
that may not yet be recognized by the broader market.
OUTLOOK
While the strength of the economy suggests that higher interest rates remain
a risk, our investment flexibility will allow us to adapt to changing market
conditions, insulating our performance from market changes while also allowing
us to capitalize on opportunities in the high-yield market. As always, we will
subject every investment idea to constant, hands-on analysis as we seek out
companies that are improving their balance sheets, paying down debt and,
consequently, have the potential of earning a credit upgrade or the interest of
a well-capitalized investor.
105
<PAGE>
PHOENIX-JANUS FLEXIBLE INCOME SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ----------
<S> <C> <C> <C>
CORPORATE BONDS--27.3%
AUTOMOBILES--4.6%
Ford Motor Credit Co., 6.125%,
4/28/03............................ A+ $ 250 $ 241,875
----------
BROADCASTING (TELEVISION, RADIO & CABLE)--4.7%
Libery Media Group 144A 7.875%,
7/15/09 (b)........................ BBB- 250 248,125
----------
HOUSEHOLD PRODUCTS (NON-DURABLE)--4.7%
Procter & Gamble Co. 6.875%,
9/15/09............................ AA 250 244,688
----------
RETAIL (FOOD CHAINS)--9.5%
Safeway, Inc. 5.875%, 11/15/01....... BBB 250 244,375
Stater Brothers Holdings, Inc.
10.75%,
8/15/06............................ B+ 250 250,625
----------
495,000
----------
TELECOMMUNICATIONS (LONG DISTANCE)--3.8%
Viatel Inc. 11.50%, 3/15/09.......... B- 200 200,000
----------
TOTAL CORPORATE BONDS
(Identified cost $1,437,059)................................. 1,429,688
----------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
----------- -------- ----------
<S> <C> <C> <C>
FOREIGN CORPORATE BONDS--4.1%
NETHERLANDS--4.1%
Versatel Telecom BV 11.875%, 7/15/09
(c)................................ B- $ 200 $ 214,523
----------
TOTAL FOREIGN CORPORATE BONDS
(Identified cost $216,514)................................... 214,523
----------
TOTAL LONG-TERM INVESTMENTS--31.4%
(Identified cost $1,653,573)................................. 1,644,211
----------
</TABLE>
<TABLE>
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--72.3%
FEDERAL AGENCY SECURITIES--72.3%
Freddie Mac Discount Note 1.50%, 1/3/00......... 3,780 3,779,685
----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $3,779,685)............................... 3,779,685
----------
TOTAL INVESTMENTS--103.7%
(Identified cost $5,433,258)............................... 5,423,896(a)
Cash and receivables, less liabilities--(3.7%)............. (192,241)
----------
NET ASSETS--100.0%........................................... $5,231,655
==========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized depreciation
of investment securities is comprised of gross appreciation
of $0 and gross depreciation of $9,362 for federal income
tax purposes. At December 31, 1999, the aggregate cost of
securities for federal income tax purpose was $5,433,258.
(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 December 31, 1999 these securities
amounted to a value of $248,125 or 4.7% of net assets.
(c) Par value represents Euro.
</TABLE>
See Notes to Financial Statements
106
<PAGE>
PHOENIX-JANUS FLEXIBLE INCOME SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$5,433,258)............................................... $5,423,896
Cash........................................................ 8,295
Receivables
Interest and dividends.................................... 47,254
Receivable from adviser................................... 14,373
----------
Total assets............................................ 5,493,818
----------
LIABILITIES
Payables
Investment securities purchased........................... 245,595
Trustees' fee............................................. 1,297
Financial agent fee....................................... 93
Accrued expenses............................................ 15,178
----------
Total liabilities....................................... 262,163
----------
NET ASSETS.................................................. $5,231,655
==========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $5,241,087
Net unrealized depreciation............................... (9,432)
----------
NET ASSETS.................................................. $5,231,655
==========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 524,141
==========
Net asset value and offering price per share................ $9.98
==========
</TABLE>
STATEMENT OF OPERATIONS
FROM INCEPTION DECEMBER 15, 1999 TO DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $12,895
-------
Total investment income................................. 12,895
-------
EXPENSES
Investment advisory fee................................... 1,790
Financial agent fee....................................... 93
Professional.............................................. 10,000
Printing.................................................. 4,478
Trustees.................................................. 1,297
Custodian................................................. 364
Miscellaneous............................................. 266
-------
Total expenses.......................................... 18,288
Less expenses borne by investment adviser............... (16,163)
-------
Net expenses............................................ 2,125
-------
NET INVESTMENT INCOME....................................... 10,770
-------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... --
Net change in unrealized appreciation (depreciation) on
investments............................................. (9,362)
Net change in unrealized appreciation (depreciation) on
foreign currency and foreign currency transactions...... (70)
-------
NET LOSS ON INVESTMENTS..................................... (9,432)
-------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $ 1,338
=======
</TABLE>
See Notes to Financial Statements
107
<PAGE>
PHOENIX-JANUS FLEXIBLE INCOME SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 10,770
Net realized gain (loss).................................. --
Net change in unrealized appreciation (depreciation)...... (9,432)
----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 1,338
----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (10,770)
In excess of net investment income........................ (214)
----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (10,984)
----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (523,045 shares)............ 5,230,359
Net asset value of shares issued from reinvestment of
distributions(1,100 shares)............................. 10,984
Cost of shares repurchased (4 shares)..................... (42)
----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 5,241,301
----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 5,231,655
NET ASSETS
Beginning of period....................................... --
----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME OF $0)........................................... $5,231,655
==========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
Net asset value, beginning of period........................ $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.02
Net realized and unrealized gain (loss)................... (0.02)
------
TOTAL FROM INVESTMENT OPERATIONS........................ --
------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.02)
------
TOTAL DISTRIBUTIONS..................................... (0.02)
------
CHANGE IN NET ASSET VALUE................................... $(0.02)
------
NET ASSET VALUE, END OF PERIOD.............................. $ 9.98
======
Total return................................................ 0.02%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $5,232
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3)..................................... 0.95%(1)
Net investment income..................................... 4.81%(1)
Portfolio turnover rate..................................... 0%(2)
</TABLE>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 8.18% for
the period ended December 31, 1999.
See Notes to Financial Statements
108
<PAGE>
PHOENIX-JANUS GROWTH SERIES
INVESTOR PROFILE
The Fund is appropriate for growth-oriented investors looking for superior
long-term capital appreciation. It is ideal for moderately aggressive investors
seeking a diversified equity Fund capable of serving as the cornerstone of their
overall portfolio.
INVESTMENT ADVISOR'S REPORT
The Fund was opened to investors on December 20, 1999. Fund manager Marc
Pinto employs a bottom-up, research-intensive approach to security selection
that seeks to identify individual stocks capable of outperforming the market.
While the Fund can invest in companies of all sizes, Marc and his team generally
focus on large companies with globally dominant franchises and excellent
management, believing that such companies can provide substantial growth in any
economic scenario.
While detailed financial modeling lies at the heart of the stock selection
process, the investment team spends a great deal of time on the road, developing
firsthand knowledge of each and every company in the portfolio. By polling
company managers, as well as customers, competitors and suppliers, Marc and his
team strive to create an information advantage that allows them to identify
trends--both positive and negative--well before the market at large.
OUTLOOK
While technology and other high-growth segments led the market higher in
1999, the robust pace of economic growth remains a risk to equity investors.
Until recently the Federal Reserve has been held in check by "Y2K" fears and
lackluster expansion overseas, but with those constraints effectively removed,
the possibility that the U.S. central bank will adopt a more aggressive stance
is very real. This fact could keep equity markets volatile well into the coming
year as investors grapple with continued interest rate uncertainty. However, we
believe that our in-depth research has identified companies capable of
performing well regardless of what the economy has in store and look forward to
the coming year with optimism.
109
<PAGE>
PHOENIX-JANUS GROWTH SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
COMMON STOCKS--50.7%
BANKS (MAJOR REGIONAL)--1.6%
Bank of New York Co., Inc. (The).................. 1,300 $ 52,000
----------
BEVERAGES (ALCOHOLIC)--1.0%
Anheuser-Busch Cos., Inc.......................... 450 31,894
----------
BROADCASTING (TELEVISION, RADIO & CABLE)--5.3%
AT&T Corp.- Liberty Media Group Class A (b)....... 1,000 56,750
Cablevision Systems Corp. Class A................. 475 35,862
Comcast Corp. Special Class A..................... 1,625 81,656
----------
174,268
----------
COMMUNICATIONS EQUIPMENT--1.1%
Lucent Technologies, Inc.......................... 500 37,406
----------
COMPUTERS (HARDWARE)--3.9%
Dell Computer Corp. (b)........................... 1,500 76,500
Sun Microsystems, Inc. (b)........................ 675 52,270
----------
128,770
----------
COMPUTERS (NETWORKING)--2.3%
Cisco Systems, Inc. (b)........................... 700 74,987
----------
COMPUTERS (PERIPHERALS)--2.2%
EMC Corp. (b)..................................... 675 73,744
----------
COMPUTERS (SOFTWARE & SERVICES)--2.6%
Microsoft Corp. (b)............................... 725 84,644
----------
ELECTRICAL EQUIPMENT--2.6%
General Electric Co............................... 550 85,112
----------
ELECTRONICS (SEMICONDUCTORS)--3.3%
Linear Technology Corp............................ 1,025 73,352
Texas Instruments, Inc............................ 350 33,906
----------
107,258
----------
ENTERTAINMENT--5.1%
Time Warner, Inc.................................. 1,400 101,412
Viacom, Inc. Class B (b).......................... 1,075 64,970
----------
166,382
----------
EQUIPMENT (SEMICONDUCTOR)--1.5%
Applied Materials, Inc. (b)....................... 400 50,675
----------
FINANCIAL (DIVERSIFIED)--5.0%
American Express Co............................... 250 41,562
Citigroup, Inc.................................... 750 41,672
Fannie Mae........................................ 500 31,219
Morgan Stanley Dean Witter & Co................... 350 49,962
----------
164,415
----------
HEALTH CARE (DIVERSIFIED)--0.9%
Warner-Lambert Co................................. 375 30,727
----------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--1.3%
Schering-Plough Corp.............................. 975 41,133
----------
HOUSEHOLD PRODUCTS (NON-DURABLE)--0.6%
Colgate-Palmolive Co.............................. 325 21,125
----------
INVESTMENT BANKING/BROKERAGE--1.1%
Schwab (Charles) Corp. (The)...................... 925 35,497
----------
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
LODGING-HOTELS--0.7%
Carnival Corp..................................... 450 $ 21,516
----------
NATURAL GAS--1.7%
Enron Corp........................................ 1,250 55,469
----------
RETAIL (BUILDING SUPPLIES)--1.3%
Home Depot, Inc. (The)............................ 638 43,709
----------
RETAIL (GENERAL MERCHANDISE)--1.6%
Costco Wholesale Corp. (b)........................ 350 31,938
Wal-Mart Stores, Inc.............................. 300 20,738
----------
52,676
----------
RETAIL (SPECIALTY)--1.3%
Staples, Inc. (b)................................. 2,000 41,500
----------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--2.7%
Nextel Communications, Inc. Class A (b)........... 450 46,406
Sprint Corp. (PCS Group) (b)...................... 400 41,000
----------
87,406
----------
TOTAL COMMON STOCKS
(Identified cost $1,567,797)................................ 1,662,313
----------
FOREIGN COMMON STOCKS--8.3%
COMMUNICATIONS EQUIPMENT--3.5%
Nokia Oyj Sponsored ADR........................... 600 114,000
----------
ELECTRONICS (SEMICONDUCTORS)--1.2%
Taiwan Semiconductor Manufacturing Co. Ltd.
Sponsored ADR (b)............................... 900 40,500
----------
EQUIPMENT (SEMICONDUCTOR)--1.5%
ASM Lithography Holding NV (Netherlands) (b)...... 425 48,344
----------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--0.8%
Vodafone AirTouch PLC Sponsored ADR (United
Kingdom)........................................ 525 25,987
----------
TELECOMMUNICATIONS (LONG DISTANCE)--1.3%
Telefonia SA Sponsored ADR (b).................... 550 43,347
----------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $233,432).................................. 272,178
----------
TOTAL LONG-TERM INVESTMENTS --59.0%
(Identified cost $1,801,229)................................ 1,934,491
----------
</TABLE>
<TABLE>
<CAPTION>
PAR
VALUE
(000)
------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--37.9%
FEDERAL AGENCY SECURITIES--37.9%
Freddie Mac Discount Note 1.50%, 1/3/00....... $1,240 1,239,897
----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $1,239,897)............................... 1,239,897
----------
TOTAL INVESTMENTS--96.9%
(Identified cost $3,041,126)............................... 3,174,388(a)
Cash and receivables, less liabilities--3.1%............... 100,274
----------
NET ASSETS--100.0%........................................... $3,274,662
==========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $144,478 and gross depreciation of $11,216 for federal
income tax purposes. At December 31, 1999, the aggregate
cost of securities for federal income tax purpose was
$3,041,126.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
110
<PAGE>
PHOENIX-JANUS GROWTH SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$3,041,126)............................................... $3,174,388
Cash........................................................ 7,226
Receivables
Fund shares sold.......................................... 93,841
Receivable from adviser................................... 15,442
Interest and dividends.................................... 226
----------
Total assets............................................ 3,291,123
----------
LIABILITIES
Payables
Fund shares repurchased................................... 19
Financial agent fee....................................... 37
Trustees' fee............................................. 1,297
Accrued expenses............................................ 15,108
----------
Total liabilities....................................... 16,461
----------
NET ASSETS.................................................. $3,274,662
==========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $3,139,793
Undistributed net investment income....................... 1,607
Net unrealized appreciation............................... 133,262
----------
NET ASSETS.................................................. $3,274,662
==========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 308,933
==========
Net asset value and offering price per share................ $ 10.60
==========
</TABLE>
STATEMENT OF OPERATIONS
FROM INCEPTION DECEMBER 15, 1999 TO DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $ 2,381
Dividends................................................. 226
--------
Total investment income................................. 2,607
--------
EXPENSES
Investment advisory fee................................... 850
Financial agent fee....................................... 37
Professional.............................................. 10,000
Printing.................................................. 4,478
Trustees.................................................. 1,297
Custodian................................................. 364
Miscellaneous............................................. 266
--------
Total expenses.......................................... 17,292
Less expenses borne by investment adviser............... (16,292)
--------
Net expenses............................................ 1,000
--------
NET INVESTMENT INCOME....................................... 1,607
--------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net change in unrealized appreciation (depreciation) on
investments............................................. 133,262
--------
NET GAIN ON INVESTMENTS..................................... 133,262
--------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $134,869
========
</TABLE>
See Notes to Financial Statements
111
<PAGE>
PHOENIX-JANUS GROWTH SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 1,607
Net realized gain (loss).................................. --
Net change in unrealized appreciation (depreciation)...... 133,262
----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 134,869
----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... --
Net realized gains........................................ --
----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ --
----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (308,945 shares)............ 3,139,917
Net asset value of shares issued from reinvestment of
distributions (0 shares)................................ --
Cost of shares repurchased (12 shares).................... (124)
----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 3,139,793
----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 3,274,662
NET ASSETS
Beginning of period....................................... --
----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $1,607)................................ $3,274,662
==========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
Net asset value, beginning of period........................ $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.01
Net realized and unrealized gain (loss)................... 0.59
------
TOTAL FROM INVESTMENT OPERATIONS........................ 0.60
------
LESS DISTRIBUTIONS
Dividends from net investment income...................... --
------
TOTAL DISTRIBUTIONS..................................... --
------
CHANGE IN NET ASSET VALUE................................... 0.60
------
NET ASSET VALUE, END OF PERIOD.............................. $10.60
======
Total return................................................ 6.00%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $3,275
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3)..................................... 1.00%(1)
Net investment income..................................... 1.61%(1)
Portfolio turnover rate..................................... 0%(2)
</TABLE>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 17.29% for
the period ended December 31, 1999.
See Notes to Financial Statements
112
<PAGE>
PHOENIX-MORGAN STANLEY FOCUS EQUITY SERIES
INVESTOR PROFILE
The Fund is appropriate for an investor seeking long term capital
appreciation by investing in growth-oriented equity securities of large
capitalization, predominantly U.S. corporations.
INVESTMENT ADVISOR'S REPORT
The Fund, which was available to investors beginning on December 20, 1999,
has the ability to take concentrated positions up to a maximum of 25%. We employ
a bottom-up approach driven by fundamental equity research. Our investment
process is designed to identify high quality large-capitalization companies
(generally in excess of $1 billion in marketcap) that we believe are likely to
deliver surprisingly strong earnings growth. We tend to focus on three types of
stocks: classic, well known growth stocks where the "surprise" is the
consistency of earnings, less well known growth stocks that we expect to deliver
positive earnings surprises, and growth stocks driven down by unfounded fears (a
subset of the previous two).
U.S. equity markets again set records in 1999, led by large-capitalization
growth stocks in general, and a white-hot technology sector in particular. The
S&P 500 Index's(1) 21.14% increase left the index at an all-time high, and 1999
marked the 10th consecutive up year for this index. The compounded return for
the past five years is a stunning 250%. With the exception of a brief period in
the Spring, growth continued to outperform value throughout the year. The
Russell 1000 Growth Index(2) increased 32.3% in 1999, versus 5.4% for the
Russell 1000 Value Index(3) . Investors continue to believe and invest in the
sustainability of the growth of the largest companies, and for the most part,
these companies continue to deliver stellar results. The largest 50 stocks in
the S&P 500 had a forward P/E of 33.2 at year end, while the P/E of the
remaining 450 stocks was 18.6. Excluding technology, the S&P 500 would have only
risen about 7.5%. The list of top contributors to S&P 500 performance is
dominated by tech names such as Microsoft (the top contributor in 1999), Cisco
(#2), Oracle Systems (#5), Qualcomm (#7), Sun Microsystems (#8), and Intel
(#10). The performance of the market remained narrow in 1999, although some
healthy broadening did occur late in the year. The top-30 stocks in the index
accounted for 100% of the total return, and an equal-weighted return (versus a
market-capitalization weighted return) would have returned about 11.9% for the
year. With a rebound in November and December, the Russell 2000 Index(4) of
small and mid-cap stocks returned 21.3%.
OUTLOOK
The domestic economy continues to create a "Goldilocks" not too hot, not too
cold backdrop that we believe will create many opportunities for growth
investing. Notwithstanding modest interest rate increases, precipitated in part
by the anticipated global recovery and the demand for capital this will create,
we see little inflation pressure due to: 1) Continued lack of pricing in all but
a few sectors, 2) Productivity increases driven by technology (and the internet
specifically) and restructuring; and 3) Increasing domestic budget surpluses.
The benign inflation outlook combined with the gradual "u-shaped" recoveries we
expect in many foreign markets lead us to believe the outperformance of large
cap growth is likely to continue.
(1) The S&P 500 Index is an unmanaged, commonly used measure of stock market
total return performance. The Index is not available for direct investment.
(2) The Russell 1000 Growth Index is an unmanaged, commonly used measure of
small-cap, growth-oriented stock total return performance.
(3) The Russell 1000 Value Index is an unmanaged, commonly used measure of
small-cap, value-oriented stock total return performance.
(4) The Russell 2000 Index is an unmanaged, commonly used measure of small-cap
stock total return performance.
These indices are not available for direct investment.
113
<PAGE>
PHOENIX-MORGAN STANLEY FOCUS EQUITY SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
COMMON STOCKS--92.5%
AEROSPACE/DEFENSE--1.0%
General Dynamics Corp............................ 1,000 $ 52,750
----------
BANKS (MAJOR REGIONAL)--1.8%
Bank of New York Co., Inc. (The)................. 2,400 96,000
----------
BROADCASTING (TELEVISION, RADIO & CABLE)--7.6%
AT&T Corp.- Liberty Media Group Class A (b)...... 900 51,075
Clear Channel Communications, Inc. (b)........... 3,400 303,450
MediaOne Group, Inc. (b)......................... 700 53,769
----------
408,294
----------
COMMUNICATIONS EQUIPMENT--6.6%
American Tower Corp. Class A (b)................. 2,900 88,631
Lucent Technologies, Inc......................... 1,000 74,812
Motorola, Inc.................................... 1,300 191,425
----------
354,868
----------
COMPUTERS (HARDWARE)--1.3%
Sun Microsystems, Inc. (b)....................... 900 69,694
----------
COMPUTERS (NETWORKING)--5.1%
Cisco Systems, Inc. (b).......................... 2,600 278,525
----------
COMPUTERS (SOFTWARE & SERVICES)--6.9%
America Online, Inc. (b)......................... 900 67,894
Microsoft Corp. (b).............................. 2,600 303,550
----------
371,444
----------
ELECTRIC COMPANIES--1.8%
Montana Power.................................... 2,700 97,369
----------
ELECTRICAL EQUIPMENT--5.2%
General Electric Co.............................. 1,800 278,550
----------
ELECTRONICS (SEMICONDUCTORS)--7.5%
Intel Corp....................................... 1,700 139,931
JDS Uniphase Corp. (b)........................... 400 64,525
Maxim Integrated Products, Inc. (b).............. 3,000 141,562
Texas Instruments, Inc........................... 600 58,125
----------
404,143
----------
ENTERTAINMENT--2.1%
Time Warner, Inc................................. 1,600 115,900
----------
EQUIPMENT (SEMICONDUCTOR)--1.4%
Applied Materials, Inc. (b)...................... 600 76,012
----------
FINANCIAL (DIVERSIFIED)--1.5%
American Express Co.............................. 500 83,125
----------
FOODS--0.7%
Keebler Foods Co. (b)............................ 1,300 36,562
----------
HEALTH CARE (DIVERSIFIED)--7.4%
American Home Products Corp...................... 1,400 55,213
Bristol-Myers Squibb Co.......................... 2,300 147,631
Warner-Lambert Co................................ 2,400 196,650
----------
399,494
----------
HEALTH CARE (DRUGS-MAJOR PHARMACEUTICALS)--3.1%
Merck & Co., Inc................................. 1,000 67,063
Pfizer, Inc...................................... 3,100 100,556
----------
167,619
----------
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
HOUSEHOLD PRODUCTS (NON-DURABLE)--1.8%
Procter & Gamble Co. (The)....................... 900 $ 98,606
----------
MANUFACTURING (DIVERSIFIED)--11.1%
Textron, Inc..................................... 1,000 76,688
Tyco International Ltd........................... 8,000 311,000
United Technologies Corp......................... 3,300 214,500
----------
602,188
----------
RETAIL (BUILDING SUPPLIES)--4.0%
Home Depot, Inc. (The)........................... 3,150 215,972
----------
RETAIL (GENERAL MERCHANDISE)--2.4%
Costco Wholesale Corp. (b)....................... 1,400 127,750
----------
RETAIL (SPECIALTY)--1.0%
Intimate Brands, Inc............................. 1,300 56,063
----------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--5.3%
Associated Group, Inc. Class A (b)............... 400 36,500
Associated Group, Inc. Class B (b)............... 2,700 248,400
----------
284,900
----------
TELECOMMUNICATIONS (LONG DISTANCE)--3.1%
MCI WorldCom, Inc. (b)........................... 3,150 167,147
----------
TELEPHONE--2.8%
Bell Atlantic Corp............................... 2,500 153,906
----------
TOTAL COMMON STOCKS
(Identified cost $4,702,613)............................... 4,996,881
----------
FOREIGN COMMON STOCKS--3.2%
COMMUNICATIONS EQUIPMENT--3.2%
Nortel Networks Corp. (Canada)................... 1,700 171,700
----------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $156,060)................................. 171,700
----------
TOTAL LONG-TERM INVESTMENTS--95.7%
(Identified cost $4,858,673)............................... 5,168,581
----------
</TABLE>
<TABLE>
<CAPTION>
PAR
VALUE
(000)
--------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--4.3%
REPURCHASE AGREEMENT--4.3%
State Street Bank & Trust Co. repurchase
agreement, 2.00%, dated 12/31/99 due 1/3/00,
repurchase price $232,039 collateralized by
U.S. Treasury Bond 10.625%, 8/15/15, market
value $238,425.............................. $232 232,000
----------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $232,000)................................... 232,000
----------
TOTAL INVESTMENTS--100.0%
(Identified cost $5,090,673)................................. 5,400,581(a)
Cash and receivables, less liabilities--0.0%................. 1,723
----------
NET ASSETS--100.0%............................................. $5,402,304
==========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized appreciation
of investment securities is comprised of gross appreciation
of $375,149 and gross depreciation of $65,241 for federal
income tax purposes. At December 31, 1999, the aggregate
cost of securities for federal income tax purpose was
$5,090,673.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
114
<PAGE>
PHOENIX-MORGAN STANLEY FOCUS EQUITY SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$5,090,673)............................................... $5,400,581
Cash........................................................ 839
Receivables
Receivable from adviser................................... 14,239
Fund shares sold.......................................... 2,223
Dividends and interest.................................... 933
----------
Total assets............................................ 5,418,815
----------
LIABILITIES
Payables
Financial agent fee....................................... 93
Trustees' fee............................................. 1,310
Accrued expenses............................................ 15,108
----------
Total liabilities....................................... 16,511
----------
NET ASSETS.................................................. $5,402,304
==========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $5,085,371
Undistributed net investment income....................... 879
Accumulated net realized gain............................. 6,146
Net unrealized appreciation............................... 309,908
----------
NET ASSETS.................................................. $5,402,304
==========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 508,162
==========
Net asset value and offering price per share................ $ 10.63
==========
</TABLE>
STATEMENT OF OPERATIONS
FROM INCEPTION DECEMBER 15, 1999 TO DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest.................................................. $ 2,231
Dividends................................................. 920
--------
Total investment income................................. 3,151
--------
EXPENSES
Investment advisory fee................................... 1,932
Financial agent fee....................................... 93
Professional.............................................. 10,000
Printing.................................................. 4,478
Trustees.................................................. 1,310
Custodian................................................. 364
Miscellaneous............................................. 266
--------
Total expenses.......................................... 18,443
Less expenses borne by investment adviser............... (16,171)
--------
Net expenses............................................ 2,272
--------
NET INVESTMENT INCOME....................................... 879
--------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on securities........................... 6,146
Net change in unrealized appreciation (depreciation) on
investments............................................. 309,908
--------
NET GAIN ON INVESTMENTS..................................... 316,054
--------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $316,933
========
</TABLE>
See Notes to Financial Statements
115
<PAGE>
PHOENIX-MORGAN STANLEY FOCUS EQUITY SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
-------------------
<S> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 879
Net realized gain (loss).................................. 6,146
Net change in unrealized appreciation (depreciation)...... 309,908
----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. 316,933
----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... --
Net realized gains........................................ --
----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ --
----------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (508,166 shares)............ 5,085,418
Net asset value of shares issued from reinvestment of
distributions (0 shares)................................ --
Cost of shares repurchased (4 shares)..................... (47)
----------
NET INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 5,085,371
----------
INCREASE (DECREASE) IN NET ASSETS......................... 5,402,304
NET ASSETS
Beginning of period....................................... --
----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $879).................................. $5,402,304
==========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM INCEPTION
12/15/99 TO
12/31/99
---------------
<S> <C>
Net asset value, beginning of period........................ $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. --
Net realized and unrealized gain (loss)................... 0.63
------
TOTAL FROM INVESTMENT OPERATIONS........................ 0.63
------
LESS DISTRIBUTIONS
Dividends from net investment income...................... --
Dividends from net realized gains......................... --
------
TOTAL DISTRIBUTIONS..................................... --
------
CHANGE IN NET ASSET VALUE................................... 0.63
------
NET ASSET VALUE, END OF PERIOD.............................. $10.63
======
Total return................................................ 6.31%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $5,402
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3)..................................... 1.00%(1)
Net investment income..................................... 0.39%(1)
Portfolio turnover rate..................................... 2%(2)
</TABLE>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 8.11% for
the period ended December 31, 1999.
See Notes to Financial Statements
116
<PAGE>
PHOENIX-SCHAFER MID-CAP VALUE SERIES
INVESTOR PROFILE
The Phoenix-Schafer Mid-Cap Value Series is appropriate for investors
seeking long-term capital appreciation.
INVESTMENT ADVISER'S REPORT
For the second straight year, value investing has been a very trying
experience. The struggle has been particularly acute for investors following a
disciplined strategy consistent with the market's past history, as we do with
the Phoenix-Schafer Mid-Cap Value Series. For the year ended December 31, 1999,
the Fund was down 10.28% versus the S&P 500 Index(1), which advanced 21.14%.
It has been our experience that every five years or so, our approach to
investing falls out of favor. What has made this such an agonizing period for
shareholders is that it has been the longest-lasting and deepest out-of-favor
period we have ever experienced. Further, I've never seen the U.S. stock market
so narrow in my entire investment career, which dates back to 1966.
Qualcomm, Microsoft, Cisco Systems, Oracle, and Nortel Networks were the
five stocks that contributed almost all of the S&P 500's gain in 1999. It is
hard to imagine the stock market getting much narrower than it is at the
present, and if history does repeat itself, we could be coming close to the end
of this very selective market.
In past periods of extreme stock market behavior (ending in 1974, 1980, and
1990), the subsequent broadening-out period has been especially rewarding for
value investors. To see just how much, we've examined the three-year returns of
value stocks (those ranked at the bottom 20% of the S&P 500 by P/E ratio) in
these previous broadening-out periods. We then compared these figures with the
returns of the broader index for the same time frames. The results show that,
after past out-of-favor periods, value investors certainly benefited from their
patience.
<TABLE>
3-YEAR CUMULATIVE 3-YEAR CUMULATIVE
TIME PERIOD RETURNS--VALUE STOCKS RETURNS--S&P500
<S> <C> <C>
1975-1977 205 % 58 %
1981-1983 88 % 42 %
1991-1993 96 % 55 %
</TABLE>
OUTLOOK
Our strong belief is that it is a matter of when, not if, value investing
will come back into favor. History has shown that the combination of low
valuations and strong earnings growth eventually leads to dramatic recoveries in
stock prices and investment results.
We remain confident in the long-term potential of the Phoenix-Schafer
Mid-Cap Value Series, and thank you for your patience and your continued
investment.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
MID-CAP VALUE SERIES S&P 500 INDEX(1)
<S> <C> <C>
3/2/1998 $10,000.00 $10,000.00
12/31/1998 $8,862.77 $11,895.30
12/31/1999 $7,951.45 $14,409.38
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING 12/31/99
<S> <C> <C>
FROM
INCEPTION
3/2/98 TO
1 YEAR 12/31/99
- --------------------------------------------------------------------------------------
Mid-Cap Value Series (10.28)% (11.76)%
- --------------------------------------------------------------------------------------
S&P 500 Index(1) 21.14% 22.06%
- --------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 3/2/98.
Returns shown include the reinvestment of all distributions at net asset value,
and the change in share price for the stated period. Returns indicate past
performance, which is not predictive of future performance. Investment return
and net asset value will fluctuate so that your shares, when redeemed, may be
worth more or less than the original cost. Foreign investing involves special
risks such as currency fluctuation and less public disclosure, as well as
economic and political risks.
(1) The S&P 500 Index is an unmanaged, commonly used measure of stock market
total retrun performance. The Index is not available for direct investment.
117
<PAGE>
PHOENIX-SCHAFER MID-CAP VALUE SERIES
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
COMMON STOCKS--82.5%
AIR FREIGHT--3.0%
FDX Corp. (b).................................... 6,400 $ 262,000
----------
AUTO PARTS & EQUIPMENT--5.0%
Borg-Warner Automotive, Inc...................... 5,200 210,600
Dana Corp........................................ 7,300 218,544
----------
429,144
----------
BANKS (MAJOR REGIONAL)--4.2%
Mellon Financial Corp............................ 5,600 190,750
Summit Bancorp................................... 5,600 171,500
----------
362,250
----------
BANKS (MONEY CENTER)--4.8%
Bank of America Corp............................. 3,200 160,600
Chase Manhattan Corp. (The)...................... 3,300 256,369
----------
416,969
----------
BUILDING MATERIALS--4.9%
Armstrong World Industries, Inc.................. 3,100 103,462
Lafarge Corp..................................... 6,800 187,850
Owens Corning.................................... 6,800 131,325
----------
422,637
----------
COMPUTERS (SOFTWARE & SERVICES)--5.3%
Cadence Design System, Inc. (b).................. 18,900 453,600
----------
CONSTRUCTION (CEMENT & AGGREGATES)--2.4%
Southdown, Inc................................... 4,100 211,662
----------
ELECTRICAL EQUIPMENT--3.8%
Harman International Industries, Inc............. 5,900 331,137
----------
ELECTRONICS (COMPONENT DISTRIBUTORS)--7.1%
Arrow Electronics, Inc. (b)...................... 12,900 327,337
Avnet, Inc....................................... 4,700 284,350
----------
611,687
----------
HEALTH CARE (GENERIC AND OTHER)--6.5%
ICN Pharmaceuticals, Inc......................... 10,400 263,250
Mylan Laboratories, Inc.......................... 11,700 294,694
----------
557,944
----------
HEALTH CARE (SPECIALIZED SERVICES)--3.3%
Omnicare, Inc.................................... 23,800 285,600
----------
HOUSEHOLD FURNISHINGS & APPLIANCES--3.8%
Maytag Corp...................................... 6,800 326,400
----------
INSURANCE (PROPERTY-CASUALTY)--5.6%
Berkley (W.R.) Corp.............................. 7,800 162,825
Chubb Corp. (The)................................ 3,600 202,725
Old Republic International Corp.................. 8,500 115,812
----------
481,362
----------
<CAPTION>
SHARES VALUE
-------- ----------
<S> <C> <C> <C>
INVESTMENT BANKING/BROKERAGE--6.1%
Merrill Lynch & Co., Inc......................... 3,800 $ 317,300
Paine Webber Group, Inc.......................... 5,400 209,588
----------
526,888
----------
IRON & STEEL--4.8%
Cleveland-Cliffs, Inc............................ 5,800 180,525
UCAR International, Inc. (b)..................... 13,000 231,563
----------
412,088
----------
MANUFACTURING (SPECIALIZED)--2.4%
Diebold, Inc..................................... 9,000 211,500
----------
RAILROADS--2.1%
Burlington Northern Santa Fe Corp................ 7,400 179,450
----------
RETAIL (SPECIALTY)--4.8%
Jo-Ann Stores, Inc. Class A (b).................. 15,200 171,000
Office Depot, Inc. (b)........................... 22,500 246,094
----------
417,094
----------
TELEPHONE--2.6%
GTE Corp......................................... 3,200 225,800
----------
TOTAL COMMON STOCKS
(Identified cost $7,577,710)............................... 7,125,212
----------
FOREIGN COMMON STOCKS--17.7%
AIRLINES--1.7%
Koninklijke Luchtvaart Maatschappij NV (KLM)
(Netherlands).................................. 6,003 149,700
----------
COMMUNICATIONS EQUIPMENT--2.5%
ECI Telecom Ltd. (Israel)........................ 6,800 215,050
----------
ELECTRICAL EQUIPMENT--3.4%
Koninklijke (Royal) Philips Electronics NV NY
Registered Shares (Netherlands)................ 2,168 292,680
----------
INSURANCE (PROPERTY-CASUALTY)--2.6%
PartnerRe Ltd. (Bermuda)......................... 6,800 220,575
----------
MACHINERY (DIVERSIFIED)--2.5%
CNH Global NV (Netherlands)...................... 16,500 219,656
----------
OIL & GAS (DRILLING & EQUIPMENT)--2.8%
Petroleum Geo-Services Sponsored ADR (Norway)
(b)............................................ 13,500 240,469
----------
RAILROADS--2.2%
Canadian National Railway Co. (Canada)........... 7,200 189,450
----------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $1,610,562)............................... 1,527,580
----------
TOTAL INVESTMENTS--100.2%
(Identified cost $9,188,272)............................... 8,652,792(a)
Cash and receivables, less liabilities--(0.2%)............. (17,401)
----------
NET ASSETS--100.0%........................................... $8,635,391
==========
</TABLE>
<TABLE>
<S> <C>
(a) Federal Income Tax Information: Net unrealized depreciation
of investment securities is comprised of gross appreciation
of $1,133,176 and gross depreciation of $1,668,656 for
federal income tax purposes. At December 31, 1999, the
aggregate cost of securities for federal income tax purposes
was $9,188,272.
(b) Non-income producing.
</TABLE>
See Notes to Financial Statements
118
<PAGE>
PHOENIX-SCHAFER MID-CAP VALUE SERIES
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value (Identified cost
$9,188,272)............................................... $ 8,652,792
Cash........................................................ 16,784
Receivables
Receivable from adviser................................... 11,251
Fund shares sold.......................................... 10,402
Dividends and interest.................................... 6,903
Prepaid expenses............................................ 119
-----------
Total assets............................................ 8,698,251
-----------
LIABILITIES
Payables
Fund shares repurchased................................... 5,356
Trustees' fee............................................. 6,958
Financial agent fee....................................... 5,335
Accrued expenses............................................ 45,211
-----------
Total liabilities......................................... 62,860
-----------
NET ASSETS.................................................. $ 8,635,391
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest.......... $10,330,629
Undistributed net investment income....................... 2,237
Accumulated net realized loss............................. (1,161,995)
Net unrealized depreciation............................... (535,480)
-----------
NET ASSETS.................................................. $ 8,635,391
===========
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization................................... 1,104,571
===========
Net asset value and offering price per share................ $ 7.82
===========
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends................................................. $ 220,219
Interest.................................................. 9,220
Foreign taxes withheld.................................... (5,068)
-----------
Total investment income................................. 224,371
-----------
EXPENSES
Investment advisory fee................................... 90,746
Financial agent fee....................................... 55,409
Printing.................................................. 22,998
Professional.............................................. 21,166
Trustees.................................................. 16,632
Custodian................................................. 8,577
Miscellaneous............................................. 7,643
-----------
Total expenses.......................................... 223,171
Less expenses borne by investment adviser............... (119,460)
-----------
Net expenses............................................ 103,711
-----------
NET INVESTMENT INCOME....................................... 120,660
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on securities........................... (820,431)
Net change in unrealized appreciation (depreciation) on
investments............................................. (263,023)
-----------
NET LOSS ON INVESTMENTS..................................... (1,083,454)
-----------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $ (962,794)
===========
</TABLE>
See Notes to Financial Statements
119
<PAGE>
PHOENIX-SCHAFER MID-CAP VALUE SERIES
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FROM INCEPTION
YEAR ENDED 3/2/98 TO
12/31/99 12/31/98
----------- ---------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss).............................. $ 120,660 $ 23,057
Net realized gain (loss).................................. (820,431) (341,564)
Net change in unrealized appreciation (depreciation)...... (263,023) (272,457)
---------- ----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS.............................................. (962,794) (590,964)
---------- ----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income..................................... (118,423) (23,057)
In excess of net investment income........................ -- (118)
---------- ----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO
SHAREHOLDERS............................................ (118,423) (23,175)
---------- ----------
FROM SHARE TRANSACTIONS
CLASS A
Proceeds from sales of shares (729,302 and 1,051,036
shares, respectively)................................... 5,967,581 9,921,823
Net asset value of shares issued from reinvestment of
distributions (15,212 and 2,696 shares, respectively)... 118,423 23,175
Cost of shares repurchased (533,510 and 160,165 shares,
respectively)........................................... (4,264,988) (1,435,267)
---------- ----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE
TRANSACTIONS............................................ 1,821,016 8,509,731
---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS..................... 739,799 7,895,592
NET ASSETS
Beginning of period....................................... 7,895,592 --
---------- ----------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF $2,237 AND DISTRIBUTIONS IN EXCESS OF
NET INVESTMENT INCOME OF ($118), RESPECTIVELY).......... $8,635,391 $7,895,592
========== ==========
</TABLE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
FROM INCEPTION
YEAR ENDED 3/2/98 TO
12/31/99 12/31/98
----------- ---------------
<S> <C> <C>
Net asset value, beginning of period........................ $ 8.84 $ 10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss).............................. 0.11 0.03(4)
Net realized and unrealized gain (loss)................... (1.02) (1.16)
------- -------
TOTAL FROM INVESTMENT OPERATIONS........................ (0.91) (1.13)
------- -------
LESS DISTRIBUTIONS
Dividends from net investment income...................... (0.11) (0.03)
------- -------
TOTAL DISTRIBUTIONS..................................... (0.11) (0.03)
------- -------
CHANGE IN NET ASSET VALUE................................... (1.02) (1.16)
------- -------
NET ASSET VALUE, END OF PERIOD.............................. $ 7.82 $8.84
======= =======
Total return................................................ (10.28)% (11.37)%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands)....................... $8,635 $7,896
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses(3)..................................... 1.20% 1.20%(1)
Net investment income..................................... 1.40% 0.52%(1)
Portfolio turnover rate..................................... 29% 21%(2)
</TABLE>
<TABLE>
<C> <S>
(1) Annualized.
(2) Not annualized.
(3) If the investment adviser had not waived fees and reimbursed
expenses, the ratio of operating expenses to average net
assets would have been 2.58% and 2.77% for the periods ended
December 31, 1999 and 1998, respectively.
(4) Computed using average shares outstanding.
</TABLE>
See Notes to Financial Statements
120
<PAGE>
THE PHOENIX EDGE SERIES FUND
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
NOTE 1--ORGANIZATION
The Phoenix Edge Series Fund (the "Fund") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940, as
amended, as an open-end management investment company. The Fund is comprised
of the Phoenix-Aberdeen International Series, Phoenix-Engemann Capital Growth
Series, Phoenix-Engemann Nifty Fifty Series, Phoenix-Goodwin Money Market
Series, Phoenix-Goodwin Multi-Sector Fixed Income Series, Phoenix-Hollister
Value Equity Series, Phoenix-Oakhurst Balanced Series, Phoenix-Oakhurst
Growth and Income Series, Phoenix-Oakhurst Strategic Allocation Series,
Phoenix-Seneca Mid-Cap Growth Series, Phoenix-Seneca Strategic Theme Series,
Phoenix-Aberdeen New Asia Series, Phoenix-Duff & Phelps Real Estate
Securities Series, Phoenix Research Enhanced Index Series, Phoenix-Bankers
Trust Dow 30 Series, Phoenix-Federated U.S. Government Bond Series,
Phoenix-Janus Equity Income Series, Phoenix-Janus Flexible Income Series,
Phoenix-Janus Growth Series, Phoenix-Morgan Stanley Focus Equity Series, and
Phoenix-Schafer Mid-Cap Value Series. The Fund was established as part of the
December 8, 1986 reorganization of the Phoenix Home Life Variable
Accumulation Account (the "Account") from a management investment company to
a unit investment trust under the Investment Company Act of 1940. The Fund is
organized with Series which are available only to the subaccounts of the
Phoenix Home Life Variable Accumulation Account, Phoenix Home Life Variable
Universal Life Account, PHL Variable Accumulation Account, Phoenix Life and
Annuity Variable Universal Life Account, and Phoenix Home Life Separate
Accounts B, C and D.
Each Series has distinct investment objectives. The Phoenix-Aberdeen
International Series seeks as its investment objective a high total return
consistent with reasonable risk by investing primarily in an internationally
diversified portfolio of equity securities. The Phoenix-Engemann Capital
Growth Series seeks to achieve intermediate and long-term growth of capital,
with income as a secondary consideration. The Phoenix-Engemann Nifty Fifty
Series seeks to achieve long-term capital appreciation investing in
approximately 50 different securities which offer the potential for long term
growth of capital. The Phoenix-Goodwin Money Market Series seeks to provide
maximum current income consistent with capital preservation and liquidity.
The Phoenix-Goodwin Multi-Sector Fixed Income Series seeks to provide
long-term total return by investing in a diversified portfolio of high yield
and high quality fixed income securities. The Phoenix-Hollister Value Equity
Series seeks to achieve long-term capital appreciation and income by
investing in a diversified portfolio of common stocks which meet certain
quantitative standards that indicate above average financial soundness and
intrinsic value relative to price. The Phoenix-Oakhurst Balanced Series seeks
to provide reasonable income, long-term growth and conservation of capital.
The Phoenix-Oakhurst Growth and Income Series seeks as its investment
objective, dividend growth, current income and capital appreciation by
investing in common stocks. The Phoenix-Oakhurst Strategic Allocation Series
seeks to realize as high a level of total rate of return over an extended
period of time as is considered consistent with prudent investment risk by
investing in three market segments; stocks, bonds and money market
instruments. The Phoenix-Seneca Mid-Cap Growth Series seeks capital
appreciation primarily through investments in equity securities of companies
that have the potential for above average market appreciation. The
Phoenix-Seneca Strategic Theme Series seeks long-term appreciation of capital
by investing in securities that the adviser believes are well positioned to
benefit from cultural, demographic, regulatory, social or technological
changes worldwide. The Phoenix-Aberdeen New Asia Series seeks to provide
long-term capital appreciation by investing primarily in diversified equity
securities of issuers organized and principally operating in Asia, excluding
Japan. The Phoenix-Duff & Phelps Real Estate Securities Series seeks to
achieve capital appreciation and income with approximately equal emphasis
through investments in real estate investment trusts and companies that
operate, manage, develop or invest in real estate. The Phoenix Research
Enhanced Index Series seeks high total return by investing in a broadly
diversified portfolio of equity securities of large and medium capitalization
companies within market sectors reflected in the Standard & Poor's 500
Composite Stock Price Index. The Phoenix-Bankers Trust Dow 30 Series seeks to
track the total return of the Dow Jones Industrial Average-SM- (the
"DJIA-SM-") before fund expenses. The Phoenix-Federated U.S. Government Bond
Series pursues total return by investing primarily in debt obligation of the
U.S. government, its agencies and instrumentalities. The Phoenix-Janus Equity
Income Series seeks current income and long-term growth of capital. The
Phoenix-Janus Flexible Income Series seeks to obtain maximum total return,
consistent with preservation of capital. The Phoenix-Janus Growth Series
seeks long-term growth of capital in a manner consistent with the
preservation of capital. The Phoenix-Morgan Stanley Focus Equity Series seeks
capital appreciation by investing primarily in equity securities. The
Phoenix-Schafer Mid-Cap Value Series seeks to achieve long-term capital
appreciation with current income as the secondary investment objective by
investing in common stocks of established companies having strong financial
position and a low stock market valuation at the time of purchase which are
believed to offer the possibility of increase in value.
NOTE 2--SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets, liabilities,
revenues and expenses. Actual results could differ from those estimates.
A. SECURITY VALUATION
Equity securities are valued at the last sale price, or if there had been no
sale that day, at the last bid price. Debt securities are valued on the basis
of broker quotations or valuations provided by a pricing service which
utilizes information with respect to recent sales, market transactions in
comparable securities, quotations from dealers, and various relationships
between securities in determining value. Short-term investments having a
remaining maturity of 60 days or less are valued at amortized cost which
121
<PAGE>
THE PHOENIX EDGE SERIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999
approximates market. 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 Phoenix-Goodwin 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 Series' 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 fair valuation. The Series attempts to maintain a
constant net asset value of $10 per share.
B. SECURITY TRANSACTIONS AND RELATED INCOME
Security transactions are recorded on the trade date. Interest income is
recorded on the accrual basis. Dividend income is recorded on the ex-dividend
date, or in the case of certain foreign securities, as soon as the Fund is
notified. The Fund does not amortize premiums except for the Phoenix-Goodwin
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 to comply with the requirements of the Internal Revenue Code,
applicable to regulated investment companies, and to distribute 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 and all
distributions are reinvested into the Fund. 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 and 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 trade date. 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
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 Fund
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 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. Forward currency contracts involve, to
varying degrees, elements of market risk in excess of the amount recognized
in the statement of assets and liabilities. Risks arise from the possible
movements in foreign exchange rates or if the counterparty does not perform
under the contract.
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 the Series as an unrealized gain (or loss). When
the contract is closed or offset with the same counterparty, the Series
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 or
offset.
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. A Series may enter into financial
futures contracts as a hedge against anticipated changes in the market value
of their portfolio securities. 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 the value of the contract. Such receipts or payments are known
as variation margins 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. The potential risk to the
Series is that the change in value of the futures contract may not correspond
to the change in value of the hedged instruments.
H. OPTIONS
The Phoenix-Aberdeen International Series, Phoenix-Hollister Value Equity
Series, Phoenix-Oakhurst Balanced Series, Phoenix-Oakhurst Growth and Income
Series, Phoenix-Oakhurst Strategic Allocation Series, Phoenix-Seneca Mid-Cap
Growth Series, Phoenix-Aberdeen New Asia Series, Phoenix-Federated U.S.
Government Bond Series and Phoenix-Morgan Stanley Focus Equity
122
<PAGE>
THE PHOENIX EDGE SERIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999
Series may write covered options or purchase options contracts for the
purpose of hedging against changes in the market value of the underlying
securities or foreign currencies.
Each Series will realize a gain or loss upon the expiration or closing of the
option transaction. Gains and losses on written options are reported
separately in the Statement of Operations. When a written option is
exercised, the proceeds on sales or amounts paid are adjusted by the amount
of premium received. Options written are reported as a liability in the
Statement of Assets and Liabilities and subsequently marked-to-market to
reflect the current value of the option. The risk associated with written
options is that the change in value of options contracts may not correspond
to the change in value of the hedged instruments. In addition, losses may
arise from changes in the value of the underlying instruments, or if a liquid
secondary market does not exist for the contracts.
Each Series may purchase options which are included in the Series' Schedule
of Investments and subsequently marked-to-market to reflect the current value
of the option. When a purchased option is exercised, the cost of the security
is adjusted by the amount of premium paid. The risk associated with purchased
options is limited to the premium paid.
I. EXPENSES
Expenses incurred by the Fund 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.
J. WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS
Each Series may engage in when-issued or delayed delivery transactions. The
Series record when-issued securities on the trade date and maintain
collateral for the securities purchased. Securities purchased on a
when-issued or delayed delivery basis begin earning interest on the
settlement date.
K. REPURCHASE AGREEMENTS
A repurchase agreement is a transaction where a Series acquires a security
for cash and obtains a simultaneous commitment from the seller to repurchase
the security at an agreed upon price and date. The Series, through its
custodian, takes possession of securities collateralizing the repurchase
agreement. The collateral is marked to market daily to ensure that the market
value of the underlying assets remains sufficient to protect the Series in
the event of default by the seller. If the seller defaults and the value of
the collateral declines or, if the seller enters insolvency proceedings,
realization of collateral may be delayed or limited.
NOTE 3--INVESTMENT ADVISORY FEES AND RELATED PARTY TRANSACTIONS
The Advisers to the Fund are Phoenix Investment Counsel, Inc. ("PIC"),
Phoenix Variable Advisors, Inc. ("PVA"), Phoenix-Aberdeen International
Advisors, LLC ("PAIA"), and Duff & Phelps Investment Management Co. ("DPIM").
As a compensation for their services to the Fund, the Advisers are entitled
to a fee based upon the following annual rates as a percentage of the average
daily net assets of each separate Series listed below:
<TABLE>
<CAPTION>
RATE FOR FIRST RATE FOR NEXT RATE FOR
SERIES ADVISER $250 MILLION $250 MILLION OVER $500 MILLION
------ -------- -------------- ------------- ------------------
<S> <C> <C> <C> <C>
Phoenix-Aberdeen International................ PIC 0.75% 0.70% 0.65%
Phoenix-Engemann Capital Growth............... PIC 0.70 0.65 0.60
Phoenix-Engemann Nifty Fifty.................. PIC 0.90 0.85 0.80
Phoenix-Goodwin Money Market.................. PIC 0.40 0.35 0.30
Phoenix-Goodwin Multi-Sector Fixed Income..... PIC 0.50 0.45 0.40
Phoenix-Hollister Value Equity................ PIC 0.70 0.65 0.60
Phoenix-Oakhurst Balanced..................... PIC 0.55 0.50 0.45
Phoenix-Oakhurst Growth and Income............ PIC 0.70 0.65 0.60
Phoenix-Oakhurst Strategic Allocation......... PIC 0.60 0.55 0.50
Phoenix-Seneca Mid-Cap Growth................. PIC 0.80 0.80 0.80
Phoenix-Seneca Strategic Theme................ PIC 0.75 0.70 0.65
Phoenix-Aberdeen New Asia..................... PAIA 1.00 1.00 1.00
Phoenix Research Enhanced Index............... PVA 0.45 0.45 0.45
Phoenix-Bankers Trust Dow 30.................. PVA 0.35 0.35 0.35
Phoenix-Federated U.S. Government Bond........ PVA 0.60 0.60 0.60
Phoenix-Janus Equity Income................... PVA 0.85 0.85 0.85
Phoenix-Janus Flexible Income................. PVA 0.80 0.80 0.80
Phoenix-Janus Growth.......................... PVA 0.85 0.85 0.85
Phoenix-Morgan Stanley Focus Equity........... PVA 0.85 0.85 0.85
Phoenix-Schafer Mid-Cap Value................. PVA 1.05 1.05 1.05
<CAPTION>
RATE FOR FIRST RATE FOR NEXT RATE FOR
$1 BILLION $1 BILLION OVER $2 BILLION
-------------- ------------- ------------------
<S> <C> <C> <C> <C>
Phoenix-Duff & Phelps Real Estate
Securities.................................. DPIM 0.75 0.70 0.65
</TABLE>
123
<PAGE>
THE PHOENIX EDGE SERIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999
Effective November 22, 1999 PVA was appointed Adviser to the Phoenix-Schafer
Mid-Cap Value Series and Phoenix-Research Enhanced Index Series.
Pursuant to a subadvisory agreement with the Fund, certain advisers delegate
certain investment decisions and research functions with respect to the
following Series to the subadvisor indicated, for which services each is paid
a fee by the respective adviser.
<TABLE>
<CAPTION>
SERIES SUBADVISER
------ ----------
<S> <C>
Phoenix-Aberdeen International Aberdeen Fund Managers, Inc. ("Aberdeen")
Phoenix-Engemann Capital Growth Roger Engemann & Associates ("Engemann")
Phoenix-Engemann Nifty Fifty Roger Engemann & Associates ("Engemann")
Phoenix-Seneca Mid-Cap Growth Seneca Capital Management, LLC ("Seneca")
Phoenix-Seneca Strategic Theme Seneca Capital Management, LLC ("Seneca")
Phoenix Research Enhanced Index J.P. Morgan Investments Management, Inc. ("J.P. Morgan")
Phoenix-Bankers Trust Dow 30 Bankers Trust Company ("Bankers Trust")
Phoenix-Federated U.S. Government Bond Federated Investment Management Company ("Federated")
Phoenix-Janus Equity Income Janus Capital Corporation ("Janus")
Phoenix-Janus Flexible Income Janus Capital Corporation ("Janus")
Phoenix-Janus Growth Janus Capital Corporation ("Janus")
Phoenix-Morgan Stanley Focus Equity Morgan Stanley Asset Management ("MSAM")
Phoenix-Schafer Mid-Cap Value Schafer Capital Management, Inc. ("Schafer")
</TABLE>
Aberdeen Fund Managers, Inc. ("Aberdeen") is subadvisor to the
Phoenix-Aberdeen International Series. For its services, Aberdeen is paid a
fee by the Advisers equal to 0.375% of the average daily net assets of the
Phoenix-Aberdeen International Series up to $250 million, 0.35% of such value
between $250 million to $500 million and 0.325% of such value in excess of
$500 million. Aberdeen is a subsidiary of Aberdeen Asset Management PLC, of
which Phoenix Home Life Mutual Insurance Company ("Phoenix") owns
approximately 11%.
Pursuant to subadvisory agreements with the Fund, the subadvisors are paid
monthly fees as follows. Engemann is paid a monthly fee at the annual rate of
0.45% of the average aggregate daily net asset values of the Phoenix-Engemann
Nifty Fifty Series up to $250,000,000, 0.45% of such values between
$250,000,000 and $500,000,000, and 0.40% of such values in excess of
$500,000,000. Engemann is also paid a monthly fee at the annual rate of 0.10%
of the average aggregate daily net assets values of the Phoenix-Engemann
Capital Growth Series up to $3 billion and 0.30% of such values in excess of
$3 billion. Seneca is paid a monthly fee at the annual rate of 0.40% of the
average aggregate daily net asset values of the Phoenix-Seneca Mid-Cap Growth
Series and 0.10% of the average aggregate daily net assets values of the
Phoenix-Seneca Strategic Theme Series up to $201 million, 0.375% for next
$799 million, 0.35% for next $1 billion, and 0.325% of such values in excess
of $2 billion. J.P. Morgan is paid a monthly fee at the annual rate of 0.25%
of the average aggregate daily net asset values of the Phoenix Research
Enhanced Index Series up to $100 million and 0.20% of such value in excess of
$100 million. Bankers Trust is paid a monthly fee at the annual rate of 0.10%
of the average aggregate daily net assets of the Phoenix-Bankers Trust Dow 30
Series, subject to a $100,000 annual minimum. Federated is paid a monthly fee
at the annual rate of 0.30% of the average aggregate daily assets of the
Phoenix-Federated U.S. Government Bond Series up to $25 million, 0.25% on the
next $25 million and 0.20% on the next $50 million. The fee is negotiable on
amounts over $50 billion. Janus is paid a monthly fee at the annual rate of
0.55% of the average aggregate daily assets of each of (calculated
separately, not in the aggregate) the Phoenix-Janus Equity Income Series, the
Phoenix-Janus Flexible Income Series and the Phoenix-Janus Growth Series up
to $100 million, 0.50% of such values between $100 million and $500 million,
and 0.45% of such values in excess of $500 million. MSAM is paid a monthly
fee at the annual rate of 0.55% of the average aggregate daily assets of the
Phoenix-Morgan Stanley Focus Equity Series up to $150 million, 0.45% of such
value between $150 million and $300 million, and 0.40% of such value in
excess of $300 million. Schafer is paid a monthly fee at the annual rate of
0.85% of the average aggregate daily net asset values of the Phoenix-Schafer
Mid-Cap Value Series up to $175 million and 0.80% of such value in excess of
$175 million.
The investment adviser for the Phoenix-Duff & Phelps Real Estate Securities
Series is Duff & Phelps Investment Management Co. ("DPIM"), a subsidiary of
Phoenix Investment Partners, Ltd. ("PXP"). PXP is a majority owned subsidiary
of Phoenix. For its services, DPIM is entitled to a fee at an annual rate of
0.75% of the average daily net assets for the first $1 billion, 0.70% on the
next $1 billion and 0.65% thereafter.
Phoenix-Aberdeen International Advisors, LLC ("PAIA") serves as the
investment adviser to the Phoenix-Aberdeen New Asia Series. PAIA is a joint
venture between PM Holdings, Inc., a direct subsidiary of Phoenix, and
Aberdeen Fund Managers, Inc. ("Aberdeen"), a wholly-owned subsidiary of
Aberdeen Asset Management PLC. PAIA is entitled to a fee, at an annual rate
of 1.00% of the average daily net assets of the Phoenix-Aberdeen New Asia
Series. Pursuant to subadvisory agreements, PAIA delegates certain investment
decisions and functions to other entities. PIC receives a fee of 0.30% of the
average daily net assets of the Phoenix-Aberdeen New Asia Series from PAIA
for providing research and other domestic advisory services, as needed. In
addition, PAIA also pays a subadvisory fee to Aberdeen of 0.40% of the
average daily net assets of the Aberdeen New Asia Series for implementing
certain portfolio transactions and providing research and other services.
Each Series (except the Phoenix-Aberdeen International, Phoenix-Seneca
Mid-Cap Growth, Phoenix-Seneca Stratetic Theme, Phoenix-Aberdeen New Asia,
Phoenix-Duff & Phelps Real Estate Securities, and Phoenix Research Enhanced
Series) pays a
124
<PAGE>
THE PHOENIX EDGE SERIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999
portion or all of its other operating expenses (not including management fee,
interest, taxes, brokerage fees and commissions), up to 0.15% of its average
net assets. The Phoenix-Aberdeen International, Phoenix-Seneca Mid-Cap
Growth, Phoenix-Seneca Strategic Theme, Phoenix-Aberdeen New Asia,
Phoenix-Duff & Phelps Real Estate Securities, and Phoenix Research Enhanced
Index pay other operating expenses up to 0.40%, 0.25%, 0.25%, 0.25%, 0.25%
and 0.10% respectively, of its average net assets. Expenses above these
limits are paid by the Advisers (PIC, DPIM, PAIA), Phoenix and/or Phoenix
Variable Insurance Company.
As Financial Agent to the Fund and to each Series, Phoenix Equity Planning
Corporation ("PEPCO"), an indirect majority-owned subsidiary of Phoenix,
receives a financial agent fee equal to the sum of (1) the documented cost of
fund accounting and related services provided by PFPC, Inc. (subagent to
PEPCO), plus (2) the documented cost to PEPCO to provide financial reporting,
tax services and oversight of subagent's performance. The current fee
schedule of PFPC, Inc. ranges from 0.085% to 0.0125% of the average daily net
asset values of the Fund. Certain minimum fees and fee waivers may apply.
At December 31, 1999, Phoenix and affiliates held shares in The Phoenix Edge
Series Fund which had the following aggregate value:
<TABLE>
<S> <C>
Phoenix-Seneca Mid-Cap Growth Series........................ $ 3,466,642
Phoenix-Aberdeen New Asia Series............................ 2,812,431
Phoenix-Bankers Trust Dow 30 Series......................... 5,123,190
Phoenix-Federated US Government Bond Series................. 4,923,790
Phoenix-Janus Equity Income Series.......................... 2,116,052
Phoenix-Janus Flexible Income Series........................ 4,998,450
Phoenix-Janus Growth Series................................. 2,118,848
Phoenix-Morgan Stanley Focus Equity Series.................. 5,312,710
Phoenix-Schafer Mid-Cap Value Series........................ 1,554,028
</TABLE>
The Adviser voluntarily contributed capital to the Phoenix-Engemann Capital
Growth Series in the amount of $1,142,985 as disclosed in the statement of
changes. This contribution offset losses realized on the sale of certain
securities by the Series. The Adviser received no shares of beneficial
interest or other consideration in exchange for this contribution which
increased the net asset value of the Series.
NOTE 4--PURCHASES AND SALES OF SECURITIES
Purchases and sales of securities during the period ended December 31, 1999
(excluding U.S. Government securities, short-term securities, options written
and forward currency contracts) aggregated the following:
<TABLE>
<CAPTION>
PURCHASES SALES
-------------- --------------
<S> <C> <C>
Phoenix-Aberdeen International Series....................... $ 191,516,473 $ 198,600,468
Phoenix-Engemann Capital Growth Series...................... 1,857,440,065 2,059,921,072
Phoenix-Engemann Nifty Fifty Series......................... 53,626,179 13,374,114
Phoenix-Goodwin Multi-Sector Fixed Income Series............ 118,829,611 154,070,907
Phoenix-Hollister Value Equity Series....................... 22,139,602 18,199,560
Phoenix-Oakhurst Balanced Series............................ 102,718,944 113,711,695
Phoenix-Oakhurst Growth and Income Series................... 86,811,217 37,654,547
Phoenix-Oakhurst Strategic Allocation Series................ 181,043,677 259,227,702
Phoenix-Seneca Mid-Cap Growth Series........................ 24,481,818 17,882,399
Phoenix-Seneca Strategic Theme Series....................... 201,336,746 163,322,413
Phoenix-Aberdeen New Asia Series............................ 7,406,134 4,428,684
Phoenix-Duff & Phelps Real Estate Securities Series......... 8,108,446 15,182,940
Phoenix Research Enhanced Index Series...................... 88,530,840 45,104,477
Phoenix-Bankers Trust Dow 30 Series......................... 5,092,547 72,492
Phoenix-Janus Equity Income Series.......................... 2,035,190 203,781
Phoenix-Janus Flexible Income Series........................ 1,653,591 --
Phoenix-Janus Growth Series................................. 1,801,229 --
Phoenix-Morgan Stanley Focus Equity Series.................. 4,961,196 109,086
Phoenix-Schafer Mid-Cap Value Series........................ 4,359,345 1,856,649
</TABLE>
There were no purchases or sales of such securities in the Money Market
Series.
Purchases and sales of long-term U.S. Government securities during the period
ended December 31, 1999 aggregated the following:
<TABLE>
<CAPTION>
PURCHASES SALES
-------------- --------------
<S> <C> <C>
Phoenix-Goodwin Multi-Sector Fixed Income Series............ $ 101,491,199 $ 76,599,050
Phoenix-Oakhurst Balanced Series............................ 66,306,564 55,629,200
Phoenix-Oakhurst Strategic Allocation Series................ 114,985,545 71,625,517
Phoenix Research Enhanced Index Series...................... 2,040,794 260,112
Phoenix-Federated U.S. Government Bond Series............... 4,782,499 --
</TABLE>
125
<PAGE>
THE PHOENIX EDGE SERIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999
Written call option activity for the year ended December 31, 1999 aggregated
the following:
<TABLE>
<CAPTION>
PHOENIX-OAKHURST
GROWTH AND INCOME SERIES
---------------------------
# OF AMOUNT OF
OPTIONS PREMIUMS
-------- -------------
<S> <C> <C>
Options outstanding at December 31, 1998.................... -- $ --
Options written............................................. 256 41,634
Options canceled in closing purchase transactions........... (67) (8,042)
Options expired............................................. (122) (25,924)
Options exercised........................................... (67) (7,668)
---- --------
Options outstanding at December 31, 1999.................... -- --
==== ========
</TABLE>
At December 31, 1999, the Phoenix Research Enhanced Index Series had entered
into futures contracts as follows:
<TABLE>
<CAPTION>
VALUE OF NET
NUMBER CONTRACTS MARKET UNREALIZED
OF WHEN VALUE OF APPRECIATION
DESCRIPTION CONTRACTS OPENED CONTRACTS (DEPRECIATION)
----------- ---------- ---------- ---------- --------------
<S> <C> <C> <C> <C>
Standard & Poor's 500 Index................ 9 $3,225,935 $3,339,450 $113,515
Standard & Poor's 500 Index................ 1 362,450 371,050 8,600
Standard & Poor's 500 Index................ 1 371,700 371,050 (650)
---- ---------- ---------- --------
11 $3,960,085 $4,081,550 $121,465
==== ========== ========== ========
</TABLE>
NOTE 5--CREDIT RISK
In countries with limited or developing markets, investments may present
greater risks than in more developed markets and the prices of such
investments may be volatile. The consequences of political, social or
economic changes in these markets may have disruptive effects on the market
prices of these investments and the income they generate, as well as a fund's
ability to repatriate such amounts.
NOTE 6--LOAN AGREEMENTS
The Fund may invest in direct debt instruments which are interests in amounts
owed by a corporate, governmental, or other borrower to lenders or lending
syndicates. The Fund's investments in loans may be in the form of
participations in loans or assignments of all or a portion of loans from
third parties. A loan is often administered by a bank or other financial
institution (the lender) that acts as agent for all holders. The agent
administers the terms of the loan, as specified in the loan agreement. When
investing in a loan participation, the Fund has the right to receive payments
of principal, interest and any fees to which it is entitled only from the
lender selling the loan agreement and only upon receipt by the lender of
payments from the borrower. The Fund generally has no right to enforce
compliance with the terms of the loan agreement with the borrower. As a
result, the Fund may be subject to the credit risk of both the borrower and
the lender that is selling the loan agreement. When the Fund purchases
assignments from lenders it acquires direct rights against the borrower on
the loan. Direct indebtedness of emerging countries involves a risk that the
government entities responsible for the repayment of the debt may be unable,
or unwilling to pay the principal and interest when due.
NOTE 7--CAPITAL LOSS CARRYOVERS
The following Series have capital loss carryovers which may be used to offset
future capital gains.
<TABLE>
<CAPTION>
PHOENIX-DUFF &
PHOENIX- PHOENIX-GOODWIN PHELPS REAL
ENGEMANN NIFTY MULTI-SECTOR FIXED PHOENIX-ABERDEEN ESTATE SECURITIES
FIFTY SERIES INCOME SERIES NEW ASIA SERIES SERIES
---------------- ------------------ ------------------ -----------------
<S> <C> <C> <C> <C>
EXPIRATION DATE
2006......................................... $ 30,157 $ 566,989 $2,631,182 $ 113,500
2007......................................... 590,466 15,302,813 -- 1,937,971
-------- ----------- ---------- ----------
Total........................................ $620,623 $15,869,802 $2,631,182 $2,051,471
======== =========== ========== ==========
<CAPTION>
PHOENIX-SCHAFER
MID-CAP VALUE
SERIES
----------------
<S> <C>
EXPIRATION DATE
2006......................................... $ 285,733
2007......................................... 715,167
----------
Total........................................ $1,000,900
==========
</TABLE>
The following Series utilized losses deferred in prior years against current
year capital gains as follows:
<TABLE>
<CAPTION>
SERIES
------
<S> <C>
Phoenix-Hollister Value Equity.............................. $104,908
Phoenix-Oakhurst Growth and Income.......................... 349,419
Phoenix-Seneca Mid-Cap Growth............................... 164,133
Phoenix-Aberdeen New Asia................................... 218,888
</TABLE>
126
<PAGE>
THE PHOENIX EDGE SERIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999
Under current tax law, capital and foreign currency losses realized after
October 31 may be deferred and treated as occurring on the first day of the
following tax year. For the year ended December 31, 1999, the following
Series deferred post-October losses as follows:
<TABLE>
<S> <C>
Phoenix-Aberdeen International Series....................... $ 82,444
Phoenix-Engemann Nifty Fifty Series......................... 72,456
Phoenix-Goodwin Multi-Sector Fixed Income Series............ 783,822
Phoenix-Hollister Value Equity Series....................... 8,076
Phoenix-Seneca Mid-Cap Growth Series........................ 19,622
Phoenix-Seneca Strategic Theme Series....................... 4,329,135
Phoenix-Duff & Phelps Real Estate Securities Series......... 1,356,700
Phoenix-Schafer Mid-Cap Value Series........................ 161,095
</TABLE>
For the year ended December 31, 1999, prior year capital losses deferred were
utilized as follows:
<TABLE>
<S> <C>
Phoenix-Goodwin Multi-Sector Fixed Income Series............ $5,850,283
Phoenix-Aberdeen New Asia Series............................ 496,277
Phoenix-Schafer Mid-Cap Value Series........................ 55,831
</TABLE>
NOTE 8--RECLASS OF CAPITAL ACCOUNTS
In accordance with accounting pronouncements, the Series 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 net investment income and realized gains
on a tax basis which is considered to be more informative to the shareholder.
As of December 31, 1999, the Series recorded the following reclassifications
to increase (decrease) the accounts listed below:
<TABLE>
<CAPTION>
UNDISTRIBUTED ACCUMULATED CAPITAL PAID IN ON
NET INVESTMENT NET REALIZED SHARES OF
INCOME (LOSS) GAIN (LOSS) BENEFICIAL INTEREST
--------------- ------------- -------------------
<S> <C> <C> <C>
Phoenix-Aberdeen International Series....................... $ 334,006 $ (425,567) $ 91,561
Phoenix-Engemann Capital Growth Series...................... 1,142,985 -- (1,142,985)
Phoenix-Engemann Nifty Fifty Series......................... 42,143 -- (42,143)
Phoenix-Goodwin Multi-Sector Fixed Income Series............ (10,065) (89,161) 99,226
Phoenix-Hollister Value Equity Series....................... 388 -- (388)
Phoenix-Oakhurst Balanced Series............................ 13,346 (13,346) --
Phoenix-Oakhurst Growth and Income Series................... 4,389 349,419 (353,808)
Phoenix-Oakhurst Strategic Allocation Series................ 10,242 (10,242) --
Phoenix-Seneca Mid-Cap Growth Series........................ 37,723 (37,026) (697)
Phoenix-Seneca Strategic Theme Series....................... 202,770 (202,770) --
Phoenix-Aberdeen New Asia Series............................ (18,783) 18,783 --
Phoenix-Janus Flexible Income Series........................ 214 -- (214)
Phoenix-Schafer Mid-Cap Value Series........................ 118 -- (118)
</TABLE>
TAX INFORMATION NOTICE (UNAUDITED)
For the fiscal year ended December 31, 1999, the following Series distributed
long-term capital gain dividends as follows:
<TABLE>
<S> <C>
Phoenix-Aberdeen International Series....................... $ 19,878,525
Phoenix-Engemann Capital Growth Series...................... 155,083,231
Phoenix-Hollister Value Equity Series....................... 222,202
Phoenix-Oakhurst Balanced Series............................ 10,209,970
Phoenix-Oakhurst Growth and Income Series................... 227,546
Phoenix-Oakhurst Strategic Allocation Series................ 13,061,609
Phoenix-Seneca Mid-Cap Growth Series........................ 324,514
Phoenix-Seneca Strategic Theme Series....................... 6,447,731
Phoenix Research Enhanced Index Series...................... 3,722,881
</TABLE>
This report is not authorized for distribution to prospective investors in The
Phoenix Edge Series Fund unless preceded or accompanied by any effective
Prospectus which includes information concerning the sales charges, Fund's
record and other pertinent information.
127
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
[LOGO]
TO THE TRUSTEES AND SHAREHOLDERS OF
THE PHOENIX EDGE 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 each of the portfolios constituting the Phoenix Edge Series Fund
(hereafter referred to as the "Fund") at December 31, 1999, the results of
each of their operations, the changes in each of their net assets and the
financial highlights for each of the periods indicated, in conformity with
accounting principles generally accepted in the United States. 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 auditing standards generally accepted in the United States,
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 December 31, 1999 by
correspondence with the custodians and brokers, provide a reasonable basis
for the opinion expressed above.
/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
February 11, 2000
128
<PAGE>
RESULTS OF SHAREHOLDER MEETINGS (UNAUDITED)
1. A special meeting of Shareholders of the Phoenix-Goodwin Strategic Theme
Series was held on August 4, 1999 to approve a subadvisory agreement
between Phoenix Investment Counsel, Inc. and Seneca Capital Management
LLC.
On the record date for this meeting, there were 6,348,879 shares
outstanding and 100% of the shares outstanding and entitled to vote were
present by proxy.
NUMBER OF VOTES
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
--------- -------- --------
<S> <C> <C> <C>
Approval of subadvisory agreement 5,827,636 179,038 342,205
</TABLE>
2. A special meeting of Shareholders of the Phoenix-Goodwin Capital Growth
Series was held on August 4, 1999 to approve a subadvisory agreement
between Phoenix Investment Counsel, Inc. and Roger Engemann &
Associates, Inc.
On the record date for this meeting, there were 77,185,374 shares
outstanding and 100% of the shares outstanding and entitled to vote were
present by proxy.
NUMBER OF VOTES
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
---------- --------- ---------
<S> <C> <C> <C>
Approval of subadvisory agreement 69,003,724 2,415,902 5,765,748
</TABLE>
3. A special meeting of Shareholders of The Phoenix Edge Series Fund was held
on November 22, 1999 to fix the number of trustees at six and elect such
number as detailed below.
On the record date for this meeting, there were 217,039,573 shares
outstanding and 100% of the shares outstanding and entitled to vote were
present by proxy.
NUMBER OF VOTES
<TABLE>
<CAPTION>
FOR WITHHELD
----------- ---------
<S> <C> <C> <C>
Election of Trustees
Eunice S. Groark 210,267,938 6,771,635
John A. Fabian 210,463,274 6,576,299
Timothy P. Shriver 209,855,563 7,184,009
Simon Y. Tan 210,463,274 6,576,299
John R. Mallin 210,330,050 6,706,522
Frank M. Ellmer 210,289,642 6,749,930
</TABLE>
4. A special meeting of Shareholders of the Phoenix-Schafer Mid-Cap Value
Series was held on November 22, 1999 to approve an investment advisory
agreement with Phoenix Variable Advisors, Inc. and a subadvisory agreement
between Phoenix Variable Advisors, Inc. and Schafer Capital Management,
Inc.
On the record date for this meeting, there were 113,620 shares
outstanding and 100% of the shares outstanding and entitled to vote were
present by proxy.
NUMBER OF VOTES
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
-------- -------- --------
<S> <C> <C> <C>
Approval of advisory and subadvisory agreements 105,395 4,525 3,700
</TABLE>
5. A special meeting of Shareholders of the Phoenix Research Enhanced Index
Series was held on November 22, 1999 to approve an investment advisory
agreement with Phoenix Variable Advisors, Inc. and a subadvisory agreement
between Phoenix Variable Advisors, Inc. and J.P. Morgan Investments
Management, Inc.
On the record date for this meeting, there were 754,320 shares
outstanding and 100% of the shares outstanding and entitled to vote were
present by proxy.
NUMBER OF VOTES
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
-------- -------- --------
<S> <C> <C> <C>
Approval of advisory and subadvisory agreements 721,721 19,106 13,493
</TABLE>
129
<PAGE>
THE PHOENIX EDGE SERIES FUND
101 Munson Street
Greenfield, Massachusetts 01301
BOARD OF TRUSTEES
Frank M. Ellmer, CPA
John Fabian
Eunice Groark
John R. Mallin
Timothy P. Shriver
Simon Y. Tan
OFFICERS
Simon Y. Tan, President
Michael E. Haylon, Executive Vice President
Michael Gilotti, Executive Vice President
Roger Engemann, Senior Vice President
David K. Schafer, Senior Vice President
Gail P. Seneca, Senior Vice President
James D. Wehr, Senior Vice President
Hugh Young, Senior Vice President
David L. Albrycht, Vice President
Christian C. Bertelsen, Vice President
Steven L. Colton, Vice President
Timothy Devlin, Vice President
Ron K. Jacks, Vice President
Christopher J. Kelleher, Vice President
Richard D. Little, Vice President
James E. Mair, Vice President
Chester S. Sokolosky, Vice President
Julie L. Sapia, Vice President
Michael Schatt, Vice President
John S. Tilson, Vice President
Nancy G. Curtiss, Treasurer
Heather N. Leonard, Assistant Treasurer
Jacqueline M. Porter, Assistant Treasurer
Jeanie G. Gagnon, Secretary
INVESTMENT ADVISERS
Phoenix Investment Counsel, Inc.
56 Prospect Street
Hartford, Connecticut 06115-0480
Duff & Phelps Investment Management Co.
55 East Monroe Street Suite 3600
Chicago, Illinois 60603
Phoenix-Aberdeen International Advisors, LLC
One American Row
Hartford, Connecticut 06102-5056
Phoenix Variable Advisors, Inc.
One American Row
Hartford, Connecticut 06102-5056
CUSTODIANS
The Chase Manhattan Bank
1 Chase Manhattan Plaza
Floor 13B
New York, New York 10081
Brown Brothers Harriman & Co.
40 Water Street
Boston, Massachusetts 02109
State Street Bank and Trust Company
1 Heritage Drive, P2N
North Quincy, Massachusetts 02171
TRANSFER AGENT
Phoenix Equity Planning Corporation
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, Connecticut 06083-2200
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
160 Federal Street
Boston, Massachusetts 02110
<PAGE>
---------------
PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY PRSRT STD
101 Munson Street U.S. Postage
P.O. Box 942 P A I D
Greenfield, MA 01302-0942 Andrew
Associates
---------------
Phoenix Home Life Mutual Insurance Company
http://www.phl.com
[PHOENIX LOGO]
WEALTH MANAGEMENT-SM-
OL2531A [RECYCLE LOGO] PRINTED ON RECYCLED PAPER 2/00
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