<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 28, 1997
REGISTRATION NO. 33-6486
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
PRE-EFFECTIVE AMENDMENT NO. [_]
POST-EFFECTIVE AMENDMENT NO. 13 [X]
AND/OR
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
AMENDMENT NO. 16
---------------
MUTUAL OF AMERICA INVESTMENT CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
320 PARK AVENUE
NEW YORK, NEW YORK 10022
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE INCLUDING ZIP CODE)
DEPOSITOR'S TELEPHONE NUMBER, INCLUDING AREA CODE (212) 224-1600
DOLORES J. MORRISSEY
MUTUAL OF AMERICA INVESTMENT CORPORATION
320 PARK AVENUE
NEW YORK, NEW YORK 10022
(NAME AND ADDRESS OF AGENT FOR SERVICE)
COPIES TO:
STANLEY M. LENKOWICZ, ESQ. ROBERT S. SCHNEIDER, ESQ.
SENIOR VICE PRESIDENT & GRAHAM & JAMES LLP
DEPUTY GENERAL COUNSEL 885 THIRD AVENUE
MUTUAL OF AMERICA LIFE INSURANCE NEW YORK, NEW YORK 10022
COMPANY
320 PARK AVENUE
NEW YORK, NEW YORK 10022
APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: As soon as practicable after
the effective date of the Registration Statement.
---------------
IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE (CHECK APPROPRIATE
SPACE)
immediately upon filing pursuant to paragraph (b)
---
--- on (date) pursuant to paragraph (b)
60 days after filing pursuant to paragraph (a)(1)
---
X on May 1, 1997 pursuant to paragraph (a)(1)
---
--- 75 days after filing pursuant to paragraph (a)(2)
--- on (date) pursuant to paragraph (a)(2) of Rule 485
THE REGISTRANT HAS REGISTERED AN INDEFINITE NUMBER OF SHARES UNDER THE
SECURITIES ACT OF 1933 PURSUANT TO RULE 24F-2 UNDER THE INVESTMENT COMPANY ACT
OF 1940. THE NOTICE REQUIRED BY SUCH RULE FOR THE REGISTRANT'S MOST RECENT
FISCAL YEAR WILL BE FILED ON FEBRUARY 28, 1997.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
Principal Office Located at:
320 Park Avenue, New York, New York 10022
Mutual of America Investment Corporation (the "Investment Company") is a
mutual fund. It issues eight series of common stock representing,
respectively, the Money Market Fund, the All America Fund, the Bond Fund, the
Short-Term Bond Fund, the Mid-Term Bond Fund, the Equity Index Fund, the
Aggressive Equity Fund and the Composite Fund.
Shares of the Funds are presently sold only to separate accounts of Mutual of
America Life Insurance Company ("Mutual of America Life") and The American
Life Insurance Company of New York ("American Life"), an indirect, wholly-
owned subsidiary of Mutual of America Life, as a funding medium for variable
annuity contracts and variable life insurance contracts issued by the
companies. Mutual of America Life and American Life are referred to as the
"Insurance Companies" and each, an "Insurance Company". The separate accounts
of the Insurance Companies are referred to as the "Separate Accounts" and
each, a "Separate Account". The variable annuity and variable life insurance
contracts issued by the Insurance Companies are referred to as the "Contracts"
and each, a "Contract". Each of the Insurance Companies has its principal
offices at 320 Park Avenue, New York 10022.
This Prospectus describes in detail the investment objectives and policies of
the eight Funds and sets forth information about the Investment Company that
you ought to know before investing in the Investment Company. Investments in
the Money Market Fund (and in the other Funds of the Investment Company) are
neither insured nor guaranteed by the U.S. Government.
A Statement of Additional Information dated May 1, 1997 has been filed with
the Securities and Exchange Commission. This Statement of Additional
Information is incorporated by reference into this Prospectus and is available
at no charge by writing Mutual of America Investment Corporation at the above
address. The Securities and Exchange Commission maintains a Web site
(http://www.sec.gov) that contains the Statement of Additional Information,
material incorporated by reference, and other information regarding
registrants that file electronically with the Commission.
- -------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- -------------------------------------------------------------------------------
This Prospectus should be read carefully and retained for further reference.
-------------------
Prospectus dated May 1, 1997
-------------------
<PAGE>
FINANCIAL HIGHLIGHTS
Income and capital changes per share for a Fund share outstanding throughout
each of the ten years during the period ended December 31, 1996, or since the
Fund's inception date if in existence less than ten years, and other
supplementary data with respect to the Funds are as follows. The information
for each of the years in the five year period ended December 31, 1996 has been
audited by the Fund's independent auditors, Arthur Andersen LLP. The financial
statements of the Investment Company, along with the report of Arthur Andersen
LLP thereon, are in the Statement of Additional Information. Information for
each of the five prior years in the period ended December 31, 1991 was audited
by the Fund's previous auditors, and per share information for these years is
presented from the perspective of the Separate Accounts. Effective 1992, the
per share information is presented from the perspective of the Funds.
Information for periods less than a full year has been annualized except where
noted. INFORMATION FOR THE ALL AMERICA FUND REFLECTS THE RESULTS OF THAT FUND
PRIOR TO A CHANGE IN ITS INVESTMENT OBJECTIVE AND POLICIES AND THE ADDITION OF
SUBADVISERS. SUCH CHANGES WERE EFFECTIVE ON MAY 1, 1994, AT WHICH DATE THE
FUND WAS RENAMED THE ALL AMERICA FUND. Further information about the
performance of the Funds, including management's discussion of performance, is
contained in the Investment Company's annual report to shareholders, which may
be obtained without charge by request to the Investment Company.
<TABLE>
<CAPTION>
MONEY MARKET FUND
---------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ----- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 1.18 $1.19 $1.17 $1.17 $1.18 $1.23 $1.23 $1.22 $1.25 $1.18
------ ----- ----- ----- ----- ----- ----- ----- ----- -----
Income From Investment
Operations
Net Investment Income.. .06 .07 .03 .04 .04 .12 .10 .12 .08 .07
Net Gains or Losses on
Securities (both
realized and
unrealized)........... -- -- .02 -- -- (.05) -- -- -- --
------ ----- ----- ----- ----- ----- ----- ----- ----- -----
Total From Investment
Operations.......... .06 .07 .05 .04 .04 .07 .10 .12 .08 .07
------ ----- ----- ----- ----- ----- ----- ----- ----- -----
Less Distributions
Dividends (from net
investment income).... (.05) (.08) (.03) (.04) (.05) (.12) (.10) (.11) (.11) --
------ ----- ----- ----- ----- ----- ----- ----- ----- -----
Total Distributions.. (.05) (.08) (.03) (.04) (.05) (.12) (.10) (.11) (.11) --
------ ----- ----- ----- ----- ----- ----- ----- ----- -----
NET ASSET VALUE, END OF
PERIOD................. $ 1.19 $1.18 $1.19 $1.17 $1.17 $1.18 $1.23 $1.23 $1.22 $1.25
====== ===== ===== ===== ===== ===== ===== ===== ===== =====
Total Return(c)......... 5.3% 5.8% 4.1% 2.9% 3.3% 4.4% 6.8% 7.8% 5.9% 5.7%
Net Assets, End of
Period ($ millions).... $ 78 $ 73 $ 81 $ 38 $ 39 $ 43 $ 89 $ 81 $ 6 $ 3
Ratio of Expenses to
Average Net Assets..... .25% .25% .25% .26% .40% .40% .40% .40% .40% .40%
Ratio of Net Income to
Average Net Assets..... 5.21% 5.66% 4.15% 2.90% 3.33% 5.73% 7.79% 8.90% 6.85% 5.99%
Portfolio Turnover
Rate(a)................ N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
</TABLE>
<TABLE>
<CAPTION>
ALL AMERICA FUND
-----------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
-----------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ----- ------ ----- ------ ------ ------ ------ ----- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGIN-
NING OF PERIOD......... $ 2.13 $1.61 $ 1.80 $1.79 $ 1.93 $ 1.70 $ 1.81 $ 1.69 $1.82 $ 1.67
------ ----- ------ ----- ------ ------ ------ ------ ----- ------
Income From Investment
Operations
Net Investment Income.. .03 .03 .04 .04 .04 .18 .08 .28 .06 .02
Net Gains or Losses on
Securities
(both realized and
unrealized)........... .41 .56 (.01) .18 .03 .23 (.11) .14 .10 .13
------ ----- ------ ----- ------ ------ ------ ------ ----- ------
Total From Investment
Operations............ .44 .59 .03 .22 .07 .41 (.03) .42 .16 .15
------ ----- ------ ----- ------ ------ ------ ------ ----- ------
Less Distributions
Dividends (from net
investment income).... (.03) (.03) (.04) (.04) (.04) (.05) (.06) (.05) (.09) --
Distributions (from
capital gains)........ (.10) (.04) (.18) (.17) (.17) (.13) (.02) (.25) (.20) --
------ ----- ------ ----- ------ ------ ------ ------ ----- ------
Total Distributions.... (.13) (.07) (.22) (.21) (.21) (.18) (.08) (.30) (.29) --
------ ----- ------ ----- ------ ------ ------ ------ ----- ------
NET ASSET VALUE, END OF
PERIOD................. $ 2.44 $2.13 $ 1.61 $1.80 $ 1.79 $ 1.93 $ 1.70 $ 1.81 $1.69 $ 1.82
====== ===== ====== ===== ====== ====== ====== ====== ===== ======
Total Return(c)......... 20.7% 36.6% 3.7%* 12.0% 3.2% 22.6% (3.8)% 24.1% 8.7% 8.3%
Net Assets, End of Pe-
riod ($ millions)...... $ 637 $ 533 $ 375 $ 424 $ 398 $ 434 $ 377 $ 437 $ 40 $ 43
Ratio of Expenses to
Average Net Assets..... .50% .50% .50% .50% .50% .50% .50% .50% .50% .50%
Ratio of Net Income to
Average Net Assets..... 1.26% 1.57% 2.11% 1.92% 2.02% 2.49% 3.33% 2.54% 3.07% 1.97%
Portfolio Turnover
Rate(a)................ 28.35% 33.63% 129.80% 93.86% 129.40% 158.35% 108.75% 117.60% 56.94% 150.74%
Average Commission Rate
Paid(d)................ $ .055 -- -- -- -- -- -- -- -- --
</TABLE>
- -------
*Total Return for 1994 reflects performance from May 2, 1994 and is not
annualized. The Total Return for calendar year 1994 was 5.6%.
2
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
BOND FUND
--------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ----- ----- ------ ------ ----- ------ ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGIN-
NING OF PERIOD......... $ 1.43 $1.27 $1.41 $ 1.41 $ 1.41 $1.33 $ 1.37 $1.27 $1.40 $1.42
------ ----- ----- ------ ------ ----- ------ ----- ----- -----
Income From Investment
Operations
Net Investment Income.. 0.9 .09 .09 .09 .09 .13 .09 -- .09 .07
Net Gains or Losses on
Securities
(both realized and
unrealized)........... (.04) .16 (.14) .09 .03 .08 (.02) .16 (.01) (.09)
------ ----- ----- ------ ------ ----- ------ ----- ----- -----
Total From Investment
Operations............ .05 .25 (.05) .18 .12 .21 .07 .16 .08 (.02)
------ ----- ----- ------ ------ ----- ------ ----- ----- -----
Less Distributions
Dividends (from net in-
vestment income)...... (.09) (.09) (.09) (.09) (.09) (.11) (.11) (.06) (.21) --
Distributions (from
capital gains)........ (.01) -- -- (.09) (.03) (.02) -- -- -- --
------ ----- ----- ------ ------ ----- ------ ----- ----- -----
Total Distributions.... .10 (.09) (.09) (.18) (.12) (.13) (.11) (.06) (.21) --
------ ----- ----- ------ ------ ----- ------ ----- ----- -----
NET ASSET VALUE, END OF
PERIOD................. $ 1.38 $1.43 $1.27 $ 1.41 $ 1.41 $1.41 $ 1.33 $1.37 $1.27 $1.40
====== ===== ===== ====== ====== ===== ====== ===== ===== =====
Total Return(c)......... 3.5% 19.4% (3.2%) 13.1% 8.6% 14.0% 3.5% 11.1% 6.2% (1.9)%
Net Assets, End of Pe-
riod ($ millions)...... $ 329 $ 311 $ 249 $ 263 $ 233 $ 187 $ 163 $ 109 $ 5 $ 4
Ratio of Expenses to
Average Net Assets..... .50% .50% .50% .50% .50% .50% .50% .50% .50% .50%
Ratio of Net Income to
Average Net Assets..... 6.70% 6.64% 6.32% 6.30% 6.93% 7.59% 8.57% 8.55% 8.25% 7.97%
Portfolio Turnover
Rate(a)................ 30.14% 41.93% 51.14% 103.16% 112.40% 95.00% 129.02% 47.70% 75.61% 47.41%
</TABLE>
<TABLE>
<CAPTION>
SHORT-TERM MID-TERM
BOND FUND BOND FUND
--------------------------- -----------------------------
YEARS ENDED DECEMBER 31, YEARS ENDED DECEMBER 31,
--------------------------- -----------------------------
1996 1995 1994 1993(1) 1996 1995 1994 1993(1)
----- ----- ----- ------ ------ ----- ----- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $1.02 $1.00 $1.02 $ 1.00 $ 1.00 $ .91 $ .99 $ 1.00
----- ----- ----- ------ ------ ----- ----- ------
Income From Investment
Operations
Net Investment Income.. .04 .06 .04 .02 .14 .06 .03 .04
Net Gains or Losses on
Securities
(both realized and
unrealized)........... .01 .02 (.02) .02 (.10) 0.9 (.07) .04
----- ----- ----- ------ ------ ----- ----- ------
Total From Investment
Operations.......... .05 .08 .02 .04 .04 .15 (.04) .08
----- ----- ----- ------ ------ ----- ----- ------
Less Distributions
Dividends (from net
investment income).... (.04) (.06) (.04) (.02) (.14) (.06) (.04) (.04)
Distributions (from
capital gains)........ -- -- -- -- -- -- -- (.05)
----- ----- ----- ------ ------ ----- ----- ------
Total Distributions.. (.04) (.06) (.04) (.02) (.14) (.06) (.04) (.09)
----- ----- ----- ------ ------ ----- ----- ------
NET ASSET VALUE, END OF
PERIOD................. $1.03 $1.02 $1.00 $ 1.02 $ .90 $1.00 $0.91 $ 0.99
===== ===== ===== ====== ====== ===== ===== ======
Total Return(c)......... 4.9% 7.7% 1.4% (b)4.6% 3.9% 16.3% (3.7)% (b)7.3%
Net Assets, End of
Period ($ millions).... $ 16 $ 3 $ 2 $ 3 $ 13 $ 24 $ 24 $ 19
Ratio of Expenses to
Average Net Assets..... .50% .50% .48% .45% .50% .50% .50% .45%
Ratio of Net Income to
Average Net Assets..... 5.42% 4.65% 3.51% 3.09% 5.80% 5.73% 4.71% 4.13%
Portfolio Turnover
Rate(a)................ 6.68% 16.47% 0.00% 122.37% 144.55% 73.72% 7.52% 162.03%
</TABLE>
- -------
(1) The Fund commenced operations on February 5, 1993.
3
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
EQUITY INDEX AGGRESSIVE
FUND EQUITY FUND
---------------------------- ----------------------
YEARS ENDED YEARS ENDED
DECEMBER 31, DECEMBER 31,
---------------------------- ----------------------
1996 1995 1994 1993(1) 1996 1995 1994(2)
------ ----- ----- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 1.35 $1.02 $1.04 $ 1.00 $ 1.35 $ 1.05 $ 1.00
------ ----- ----- ------ ------ ------ ------
Income From Investment
Operations
Net Investment Income.. .03 .02 .03 .02 .01 .01 .01
Net Gains or Losses on
Securities
(both realized and
unrealized)........... .27 .36 (.01) .04 .36 .39 .05
------ ----- ----- ------ ------ ------ ------
Total From Investment
Operations.......... .30 .38 .02 .06 .37 .40 .06
------ ----- ----- ------ ------ ------ ------
Less Distributions
Dividends (from net
investment income).... (.03) (.03) (.03) (.02) (.01) (.01) (.01)
Distributions (from
capital gains)........ (.03) (.02) (.01) -- (.24) (0.9) --
------ ----- ----- ------ ------ ------ ------
Total Distributions.. (.06) (.05) (.04) (.02) (.25) (.10) (.01)
------ ----- ----- ------ ------ ------ ------
NET ASSET VALUE, END OF
PERIOD................. $ 1.59 $1.35 $1.02 $ 1.04 $ 1.47 $ 1.35 $ 1.05
====== ===== ===== ====== ====== ====== ======
Total Return(c)......... 22.7% 36.6% 1.5% (b)6.2% 27.1% 38.2% (b)6.0%
Net Assets, End of
Period ($ millions).... $ 102 $ 43 $ 26 $ 27 $ 136 $ 59 $ 27
Ratio of Expenses to
Average Net Assets..... .13% .13% .13% .11% .85% .85% .56%
Ratio of Net Income to
Average Net Assets..... 2.19% 2.50% 2.67% 2.43% .45% .65% .7%
Portfolio Turnover
Rate(a)................ 5.85% 13.99% 6.59% 1.44% 103.68% 116.52% 60.86%
Average Commission Rate
Paid(d)................ $.0388 -- -- -- $.0591 -- --
</TABLE>
- -------
(1) The Fund commenced operations on February 5, 1993.
(2) The Fund commenced operations on May 2, 1994.
<TABLE>
<CAPTION>
COMPOSITE FUND
----------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
----------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ----- ------ ------ ------ ------ ------ ----- ----- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 1.81 $1.57 $ 1.71 $ 1.59 $ 1.61 $ 1.53 $ 1.63 $1.46 $1.60 $ 1.51
------ ----- ------ ------ ------ ------ ------ ----- ----- ------
Income From Investment
Operations
Net Investment Income.. .07 .08 .05 .05 .06 .19 .14 .11 .08 .05
Net Gains or Losses on
Securities (both
realized and
unrealized)........... .14 .27 (.10) .22 .03 .09 (.09) .17 .05 .04
------ ----- ------ ------ ------ ------ ------ ----- ----- ------
Total From Investment
Operations.......... .21 .35 (.05) .27 .09 .28 .05 .28 .13 .09
------ ----- ------ ------ ------ ------ ------ ----- ----- ------
Less Distributions
Dividends (from net
investment income).... (.08) (.08) (.07) (.05) (.06) (.07) (.10) (.08) (.17) --
Distributions (from
capital gains)........ (.17) (.03) (.02) (.10) (.05) (.13) (.05) (.03) (.10) --
------ ----- ------ ------ ------ ------ ------ ----- ----- ------
Total Distributions.. (.25) (.11) (.09) (.15) (.11) (.20) (.15) (.11) (.27) --
------ ----- ------ ------ ------ ------ ------ ----- ----- ------
NET ASSET VALUE, END OF
PERIOD................. $ 1.77 $1.81 $ 1.57 $ 1.71 $ 1.59 $ 1.61 $ 1.53 $1.63 $1.46 $ 1.60
====== ===== ====== ====== ====== ====== ====== ===== ===== ======
Total Return(c)......... 11.9% 21.9% (3.0%) 16.9% 5.9% 16.4% 1.5% 17.2% 7.9% 5.2%
Net Assets, End of
Period ($ millions).... $ 283 $ 276 $ 233 $ 228 $ 138 $ 111 $ 79 $ 67 $ 51 $ 45
Ratio of Expenses to
Average Net Assets..... .50% .50% .50% .50% .50% .50% .50% .50% .50% .50%
Ratio of Net Income to
Average Net Assets..... 3.63% 4.30% 3.88% 3.48% 4.01% 4.75% 6.20% 5.48% 5.94% 5.10%
Portfolio Turnover
Rate(a)................ 69.79% 76.84% 113.86% 100.76% 107.69% 134.91% 105.06% 87.32% 50.88% 124.04%
Average Commission Rate
Paid(d)................ $.0597 -- -- -- -- -- -- -- -- --
</TABLE>
- -------
(a) Portfolio turnover rate excludes all U.S. Government and short-term
securities.
(b) Not annualized.
(c) Total Return information does not reflect separate account charges under
contracts that allocate premiums or contributions to the Separate Accounts,
which invest in the Funds. Inclusion of separate account charges would
reduce Total Return figures.
(d) Average commission rate paid per share of stock is calculated for years
beginning after 1995.
4
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Financial Highlights.................................................... 2
General Description of the Investment Company........................... 5
Money Market Fund Yield Information..................................... 5
Investment Objectives and Policies of the Funds......................... 5
Investment Advisory Arrangements........................................ 13
The Funds' Expenses..................................................... 14
Portfolio Transactions.................................................. 15
Purchase of Shares...................................................... 15
Redemption of Shares.................................................... 15
Dividends, Distributions and Taxes...................................... 15
Additional Information.................................................. 16
</TABLE>
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS, IN CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS, AND, IF
GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE INVESTMENT COMPANY OR MUTUAL OF AMERICA
CAPITAL MANAGEMENT CORPORATION. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFERING IN ANY STATE IN WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE.
GENERAL DESCRIPTION OF THE INVESTMENT COMPANY
The Investment Company was formed as a Maryland corporation on February 21,
1986. It is a diversified, open-end management company as such terms are
defined in the Investment Company Act of 1940 (the "1940 Act"). Its investment
adviser is Mutual of America Capital Management Corporation (the "Adviser").
As a "series" type of mutual fund, the Investment Company issues separate
classes (or series) of stock, currently consisting of the Money Market Fund,
the All America Fund, the Bond Fund, the Short-Term Bond Fund, the Mid-Term
Bond Fund, the Equity Index Fund, the Aggressive Equity Fund and the Composite
Fund. The Investment Company's assets and liabilities are split into these
Funds ("Funds"). Additional Funds may be established in the future.
The terms "shareholder" and "shareholders" in this Prospectus refer to the
Insurance Companies. Mutual of America Life and American Life, through the
Separate Accounts, own all of the Investment Company's shares.
MONEY MARKET FUND YIELD INFORMATION
Set forth below is the current yield information for the Money Market Fund for
the seven-day period ended December 31, 1996, computed to include and exclude
realized and unrealized gains and losses. Yields may fluctuate from the
amounts shown.
<TABLE>
<S> <C>
Annualized Yield:
Including gains and losses..................................... 5.3%
Excluding gains and losses..................................... 5.3%
Average maturity of portfolio at end of period................... 14.6 days
</TABLE>
INVESTMENT OBJECTIVES AND POLICIES OF THE FUNDS
INVESTMENT OBJECTIVES
Each Fund of the Investment Company has a different investment objective which
it pursues through separate investment policies as described below. The
differences in objectives and policies among the Funds can be expected to
affect the return of each Fund and the degree of market and financial risk to
which each Fund is subject. As used in the following discussion, "market risk"
refers to the volatility of the reaction of the price of the security to
changes in conditions in the securities markets in general and, with
particular reference to debt securities, changes in the overall level of
interest rates; "financial risk" refers to the ability of an issuer of a debt
security to pay principal and interest on that security and to the earning
stability and overall financial soundness of an issuer of an equity security;
and "current income volatility" refers to the degree and rapidity with which
changes in the overall level of interest rates become reflected in the level
of current income of a Fund. The investment objectives of each Fund may not be
changed without the approval of the holders of a majority of the outstanding
shares of each Fund affected. There can be no assurance that the objectives of
any of the Funds will be met.
5
<PAGE>
Investments in the Money Market Fund (and in the other Funds of the Investment
Company) are neither insured nor guaranteed by the U.S. Government. The
investment objectives and policies of each Fund are discussed below.
THE MONEY MARKET FUND
The investment objective of the Money Market Fund is the realization of high
current income to the extent consistent with the maintenance of liquidity,
investment quality and stability of capital. The Fund will invest only in
money market instruments and other short-term debt securities.
Specifically, the Money Market Fund will invest only in the following kinds of
money market instruments, payable in United States dollars: (1) securities
issued or guaranteed by the United States Government or one of its agencies or
instrumentalities ("government securities"); (2) negotiable certificates of
deposit, bank time deposits, bankers' acceptances and other short-term debt
obligations of domestic banks and foreign branches of domestic banks and U.S.
branches of foreign banks (see "Investment Objectives and Policies of the
Funds--Other Portfolio Strategies--Foreign Securities"), which at the time of
their most recent annual financial statements show assets in excess of $5
billion; (3) certificates of deposit, time deposits and other short-term debt
obligations of domestic savings and loan associations, which at the time of
their most recent annual financial statements show assets in excess of $1
billion; (4) repurchase agreements covering government securities,
certificates of deposit, commercial paper or bankers' acceptances; (5)
commercial paper; (6) variable amount floating rate notes; and (7) debt
securities issued by a corporation. These instruments are more fully described
in the Statement of Additional Information.
For purposes of the Money Market Fund's investment policy only, "money market
instruments and other short-term debt securities" shall mean securities having
a remaining maturity of up to 13 months (25 months in the case of government
securities). The dollar-weighted average maturity of the securities held by
the Money Market Fund will not exceed 90 days.
The Money Market Fund may also enter into transactions in options, futures
contracts and options on futures, contracts on United States Treasury
securities and Eurodollar deposits. Such transactions and instruments are more
fully described below and in the Statement of Additional Information.
All of the securities held by the Money Market Fund will have received (or be
of comparable quality to securities which have received), at the time of the
purchase, a rating in one of the two highest categories by any two nationally
recognized statistical rating agencies and at least 95% of the securities held
by the Money Market Fund will have received (or be of comparable quality to
securities which have received), at the time of purchase, the highest rating
by any two such rating agencies. (The Board of Directors of the Investment
Company must approve or ratify the purchase of any security (other than any
government security) which has received no rating or which has been rated by
only one rating agency.) Securities which are subsequently downgraded below
the two highest categories will be disposed of as soon as practicable absent a
finding by the Board of Directors that this would not be in the best interests
of the Fund.
The Money Market Fund will not invest more than 5% of its total assets in
securities of, or subject to puts from, any one issuer (other than government
securities and repurchase agreements fully collateralized by government
securities) provided that (x) the Fund may invest up to 10% of its total
assets in securities issued or guaranteed by a single issuer with respect to
which the Fund has an unconditional put and (y) with respect to 25% of its
total assets the Fund may, with respect to securities meeting the highest
investment criteria, exceed the 5% limit for up to three business days.
The Money Market Fund should be subject to relatively little market or
financial risk but a relatively high level of current income volatility.
THE ALL AMERICA FUND
The investment objective of the All America Fund is to outperform the S&P 500
Index by providing a diversified portfolio of Active Assets with diversified
management and a broad exposure to the market. At least 65% of the All America
Fund's total assets will be invested in equity securities under normal market
conditions, and the issuers of at least 80% of the Fund's total assets will be
United States corporations or entities.
Indexed Assets. The investment objective for approximately 60% of the assets
of the All America Fund (the "Indexed Assets") is to provide investment
results that to the extent practical correspond to the price and yield
performance of publicly traded common stocks in the aggregate, as represented
by the Standard & Poor's Composite Index of 500 Stocks (the "S&P 500 Index").
The Indexed Assets will be invested in the same manner as the Equity Index
Fund. See "The Equity Index Fund" below.
Active Assets. The investment objective for the remaining approximately 40% of
the assets (the "Active Assets") is to achieve a high level of total return,
through both appreciation of capital and, to a lesser extent, current income,
by means of
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a diversified portfolio of securities that may include common stocks,
securities convertible into common stocks, bonds and money market instruments.
The Active Assets will be invested by three subadvisers (each a "Subadviser",
and together the "Subadvisers"), under a subadvisory agreement (each a
"Subadvisory Agreement") between the Adviser and each of the Subadvisers, and
the Adviser. The Adviser will allocate the Active Assets to maintain, to the
extent practicable under current market conditions, approximately equal
amounts with the Subadvisers and the Adviser. The Subadvisers are Palley-
Needelman Asset Management, Inc. ("Palley-Needelman"), Oak Associates, Ltd.
and Fred Alger Management, Inc. ("Alger Management"). See "Investment Advisory
Arrangements--The Subadvisers".
The Subadvisers and the Adviser each follow a different approach for the
investment of the Active Assets. Palley-Needelman invests its portion of
Active Assets generally in stocks that Palley-Needelman considers to be of
high quality with lower than average price volatility and low price/earning
ratios. Companies generally will have below market debt levels, earnings
growth of 10% or more, current yield greater than the average of the S&P 500,
and market capitalization of $1 billion or more. No more than 10% of the
Palley-Needelman portion may be invested in any one industry and no more than
20% may be invested in American Depositary Receipts ("ADRs"). Oak Associates
invests in mid-sized capitalization stocks that have low current income and
the potential for significant growth. Oak Associates monitors 400 stocks and
will invest its portion of the Fund in approximately 20-25 common stocks
without regard for market industry weighting. Alger Management invests in
stocks that it considers to be fundamentally sound with the potential for
strong growth and for earnings in excess of market expectations. The
securities of these companies often are traded in the over-the-counter market.
Except during temporary defensive periods, the Alger Management portion of the
Fund will invest at least 65% of its assets in equity securities of companies
that, at the time of the Fund's purchase of the securities, have total market
capitalization within the range of capitalization of the companies included in
the Russell 2000 Growth Index or the S&P SmallCap 600 Index, updated
quarterly. The Adviser generally invests in small capitalization stocks that
it considers undervalued. Its approach is to identify companies with strong
financials, substantial cash flow, conservative accounting, usually low debt-
to-equity ratios and average market capitalization generally below $1 billion.
Some of the companies whose stocks are purchased by Oak Associates, or by the
Adviser for its portion of the Active Assets, may have limited Wall Street
coverage and low institutional ownership.
Each of the Subadvisers and the Adviser will seek to achieve the investment
objective of the Active Assets by investing in such securities that, based on
certain fundamental and/or technical standards of selection, it determines
offer attractive opportunities for total return through capital appreciation
and, to a lesser degree, income. Assets in the All America Fund will be
rebalanced periodically to retain the approximate 60%/40% relationship between
Indexed Assets and Active Assets. The Adviser may manage cash allocated to the
Active Assets prior to investment in securities by the Subadvisers.
THE EQUITY INDEX FUND
The investment objective of the Equity Index Fund is to provide investment
results that to the extent practical correspond to the price and yield
performance of publicly traded common stocks in the aggregate, as represented
by the S&P 500 Index.
The Equity Index Fund will attempt to duplicate the investment results of the
S&P 500 Index, which is composed of 500 selected common stocks, most of which
are listed on the New York Stock Exchange. Standard & Poor's Corporation
chooses the stocks to be included in the S&P 500 Index solely on a statistical
basis. The inclusion of a stock in the S&P 500 Index does not imply an opinion
by Standard & Poor's Corporation that the stock is an attractive investment.
An investment in the Fund involves risks similar to those of investing in
common stocks. The Fund will attempt to be fully invested at all times in the
stocks that comprise the S&P 500 Index and at least 80% of the Fund's net
assets will be so invested.
The weightings of stocks in the S&P 500 Index are based on each stock's
relative total market capitalization; that is, its market price per share
times the number of shares outstanding. Stocks will be selected for the Fund's
portfolio in the order of their weightings in the S&P 500 Index beginning with
the heaviest weighted stocks. The percentage of the Fund's assets invested in
each of the selected stocks will be approximately the same as the percentage
the stock represents in the S&P 500 Index.
The Fund will be managed using a computer program to determine which stocks
are to be purchased or sold to replicate the S&P 500 Index to the extent
feasible. Initially the Fund contemplates executing all transactions through a
single broker. From time to time, administrative adjustments may be made in
the Fund's portfolio because of changes in the composition of the S&P 500
Index, but such changes should be infrequent.
The Fund believes that the indexing approach described above is an effective
method of substantially duplicating percentage changes in the S&P 500 Index.
It is a reasonable expectation that there will be a close correlation between
the Fund's performance and that of the S&P 500 Index in both rising and
falling markets. The Fund will attempt to achieve a correlation
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between the performance of its portfolio and that of the S&P 500 Index of at
least 0.95, without taking into account expenses. A correlation of 1.00 would
indicate perfect correlation, which would be achieved when the Fund's net asset
value, including the value of its dividend and capital gains distributions,
increases or decreases in exact proportion to changes in the S&P 500 Index. The
Fund will invest in stock index futures contracts, options on stock indices,
options on stock index future contracts, puts and calls to the extent necessary
to attempt to achieve this correlation. The Fund's ability to correlate its
performance with the S&P 500 Index, however, may be affected by, among other
things, changes in securities markets, the manner in which the S&P 500 Index is
calculated by Standard & Poor's Corporation and the timing of purchases and
redemptions. In the future, the Board of Directors, subject to the approval of
shareholders, may select another index if such a standard of comparison is
deemed to be more representative of the performance of common stocks in
general.
The Fund's ability to duplicate the performance of the S&P 500 Index also
depends to some extent on the size of the Fund's portfolio and the size of cash
flows into and out of the Fund. Investment changes to accommodate these cash
flows are made to maintain the similarity of the Fund's portfolio to the S&P
500 Index to the maximum practicable extent.
THE BOND FUND, THE SHORT-TERM BOND FUND AND THE MID-TERM BOND FUND
The three Bond Funds (the Bond Fund, the Short-Term Bond Fund and the Mid-Term
Bond Fund (sometimes collectively referred to as the "Bond Funds" or singularly
as "any" or "each" Bond Fund)) will have the same investment objectives as
described below, but will seek to achieve those objectives through different
policies representing the average maturity of the securities held in their
respective portfolios, as follows:
The Bond Fund will consist of debt securities with average maturities which
will vary according to market conditions and the stage of the interest rate
cycle.
The Short-Term Bond Fund will consist of debt securities which will produce a
portfolio with an average maturity of one to three years.
The Mid-Term Bond Fund will consist of debt securities which will produce a
portfolio with an average maturity of three to seven years.
When interest rates go up, the market value of outstanding debt securities
declines and vice versa. In recent years the volatility of the market for debt
securities has increased significantly and the market value of longer-term
obligations has been subject to wide fluctuations, particularly as contrasted
with short-term instruments. The Bond Funds may realize income to the extent
such realizations are considered advantageous in light of existing market
conditions. The annual rate of portfolio turnover of the Bond Funds is not
expected to average in excess of 200%. A high level of portfolio turnover will
result in an increase in transaction costs and may adversely affect the tax
status of the Investment Company. See "Dividends, Distributions and Taxes."
The primary investment objective of the Bond Funds is to provide as high a
level of current income over time as is believed to be consistent with prudent
investment risk. A secondary objective is preservation of shareholders'
capital. The Bond Funds seek to realize these objectives through careful
selection and, when appropriate, active trading of bonds and other investments.
The Adviser's emphasis generally is on income generation rather than market
timing. The assets of the Bond Funds will consist primarily of publicly traded
debt securities, such as bonds, notes, debentures and equipment trust
certificates. Such securities may carry certain equity features, such as
conversion of exchange rights, or warrants for the acquisition of stocks of the
same or different issuers, or participations based on revenues, sales or
profits.
It is contemplated that at least 80% of each Bond Fund's assets will consist of
(a) domestic debt securities that have at the time of purchase a rating of at
least Baa3 as determined by Moody's Investors Services, Inc. or BBB- as
determined by Standard & Poor's Corporation or equivalent ratings of a similar
nationally recognized rating service; (b) securities issued or guaranteed by
the United States Government or its agencies or instrumentalities; (c) cash or
cash equivalents; and (d) the types of money market instruments in which the
Money Market Fund may invest. These instruments should be subject to little
financial risk, to moderately high levels of market risk and to moderate
current income volatility. The remaining assets of the Bond Funds may be
invested in (1) other securities that are unrated or rated lower than Baa3 or
BBB-, which are sometimes referred to as high yield/high risk securities, (2)
Canadian and other foreign securities and (3) securities issued in foreign
markets by domestic issuers or their overseas subsidiaries if guaranteed by the
parent. Unrated securities or securities rated lower than Baa3 or BBB- may be
subject to greater market and financial risk than higher quality securities,
and it is not currently contemplated that more than 5% of any Bond Fund's
assets will consist of these securities. The instruments described in this
paragraph are more fully described in the Statement of Additional Information.
The market value of fixed-income debt securities is affected by changes in
general market interest rates. If interest rates fall, the market value of
fixed-income securities tends to rise; however, if interest rates rise, the
value of fixed-income securities
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tends to fall. This market risk affects all fixed income securities, but lower
rated and unrated securities may be subject to a greater market risk than
higher rated (lower yield) securities.
Lower rated and unrated securities are also generally subject to greater
financial risk than higher rated securities. Since lower rated and unrated
securities are generally issued by corporations that are not as creditworthy or
financially secure as issuers of higher rated securities, there is a greater
risk that issuers of lower rated (higher yield) securities will not be able to
pay the principal and interest due on such securities, especially during
periods of adverse economic conditions. Risk factors related to investments in
lower rated and unrated securities are more fully described in the Statement of
Additional Information.
Each of the Bond Funds generally will not acquire securities of companies in
any one industry if, immediately after giving effect to any such acquisition,
more than 25% of the value of its total assets would be invested in such
industry. A Fund would, however, invest more than 25% (but not more than 75%)
of its assets in the electric, gas and/or telephone utility industries whenever
it is determined that the spread between the yields on such industry securities
and Treasury notes and/or bonds is historically high and that obligations
having comparable maturity, yield and quality of issuers in other industries
are not available; provided, however, that in no event will any Bond Fund
invest more than 75% of the value of its total assets in all those industries.
No one "aspect" of the electric, gas or telephone utility industries will be
emphasized.
Investment in companies in these industries involves the risk of unfavorable
action, from an investment viewpoint, by their regulatory authorities.
Concentration in any or all of such industries may increase the investment risk
as a result of adverse circumstances which could affect all companies in a
particular industry simultaneously. In addition, debt securities in electric,
gas and telephone industries tend to have longer maturities than those of
industrial issuers, and unlike industrial debt issues, do not typically require
partial repayment of the principal through a sinking fund during the life of
the securities. As a result, electric, gas and telephone issues may show more
price volatility in periods of changing interest rates than would industrial
issues of like quality. The electric, gas and telephone utility industries are
subject to extensive government regulation as to rates and services.
The Bond Funds will not directly purchase common stocks. However, a Fund may
have up to 10% of the value of its total assets invested in stocks acquired
either by conversion of fixed-income securities or by the exercise of warrants
attached thereto. In addition, the Bond Funds may purchase preferred stocks,
but no Bond Fund may invest more than 5% of its total assets in preferred
stocks.
The Bond Funds may also enter into transactions in exchange-traded options,
futures contracts and options on futures contracts on United States Treasury
securities and Government National Mortgage Association ("Ginnie Mae")
Securities. To be included in any of the Bond Funds, options and futures must
be traded on a domestic exchange.
THE COMPOSITE FUND
The investment objective of the Composite Fund is to achieve as high a total
rate of return, through both appreciation of capital and current income, as is
consistent with prudent investment risk by means of a diversified portfolio of
publicly traded common stocks, publicly traded debt securities and money market
instruments. The Fund will seek to achieve long-term growth of its capital and
increasing income by investments in common stocks and other equity-type
securities and a high level of current income through investments in publicly
traded debt securities and money market instruments. It is anticipated that the
portion of the assets invested in each type of security will vary, at the
Investment Company's discretion, in accordance with economic conditions, the
general level of common stock prices, interest rates and other relevant
consideration, including the risks associated with each investment medium. No
more than 75% of the value of the Fund's assets may be invested in either
common stock and other equity-type securities, or in debt securities with a
remaining maturity of more than one year. Up to 100% of the Fund's assets may
be invested in money market instruments.
The equity securities invested in by the Fund will consist of the types of
equity securities in which the Active Assets of the All America Fund may be
invested. The publicly traded debt securities will consist of the types of
securities in which any Bond Fund may invest. The money market instruments will
consist of the types of securities in which the Money Market Fund may invest.
The Composite Fund may also engage in the same type of transactions in options,
futures contracts and options on futures contracts as the Stock, Bond, Short-
Term Bond, Mid-Term Bond and Money Market Funds. The Composite Fund will be
subject to varying levels of market and financial risk and current income
volatility, depending upon the "mix" of instruments in which the Fund is from
time to time invested. The Composite Fund will not invest in debt securities
rated below investment grade. Securities which are subsequently downgraded may
continue to be held and will be sold only if, in the judgment of the Investment
Adviser, it is advantageous to do so.
THE AGGRESSIVE EQUITY FUND
The Aggressive Equity Fund will be divided by the Adviser into two segments so
as to utilize two investment styles.
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The investment objective for approximately 50% of the assets of the Fund (the
"Aggressive Growth Portfolio") is to achieve capital appreciation by investing
in companies believed to possess above-average growth potential. Growth can be
in the areas of earnings or gross sales, measured in either dollars or in unit
volume. Growth potential is often sought in smaller, less well-known companies
in new and emerging areas of the economy, but may also be found in larger
companies in mature or declining industries that have been revitalized and
hold a strong industry or market position. The Aggressive Growth Portfolio
also may make investments based on prospective economic or political changes
and may invest in special situations such as corporate restructurings.
The investment objective for the other approximately 50% of the assets of the
Fund (the "Aggressive Value Portfolio") is to achieve capital appreciation by
investing in companies believed to possess valuable assets or whose securities
are undervalued in the marketplace in relation to factors such as the
company's assets, earnings, or growth potential. Such companies will generally
have one or more of the following attributes: (1) valuable fixed assets, such
as complex plant and equipment that has a high replacement cost, real estate
with a current value substantially in excess of book value or large reserves
of exploitable natural resources; or (2) valuable consumer or commercial
franchises, such as well recognized trademarks or product names or potentially
valuable transportation routes. The Aggressive Value Portfolio generally
invests in small to medium capitalization securities which have low prices in
relation to cash flow, profits, sales, book value and real net asset value.
The Fund invests primarily in stocks, but it also may purchase convertible
securities and debt obligations that may produce capital appreciation.
Securities that meet the Fund's criteria may not be popular during certain
market cycles. The Fund can also make substantial temporary investments in
investment-grade debt securities when it believes market conditions warrant.
INVESTMENT RESTRICTIONS
The Investment Company has adopted a number of restrictions and policies
relating to the investment of its assets and its activities which are
fundamental policies and may not be changed without the approval of the
holders of the Investment Company's outstanding voting securities (including a
majority of the shares of each Fund). None of the Funds will: (1) with respect
to at least 75% of the value of its total assets invest more than 5% of its
total assets in the securities of any one issuer (including repurchase
agreements with any one bank), other than securities issued or guaranteed by
the United States Government or its agencies or instrumentalities (see "The
Money Market Fund" for more restrictive policies relating to that fund); (2)
with respect to at least 75% of the value of its total assets, purchase more
than 10% of the outstanding voting securities of an issuer, except that such
restriction shall not apply to securities issued or guaranteed by the United
States Government or its agencies or instrumentalities; (3) make an investment
in an industry if that investment would make the Fund's holding in that
industry exceed 25% of the Fund's total assets except for each of the Bond
Funds, which may invest up to 75% of its total assets in the electric, gas
and/or telephone utilities industries (other than investments by the Money
Market Fund in obligations issued or guaranteed by the United States
Government, its agencies or instrumentalities, certificates of deposit, or
securities issued or guaranteed by domestic branches of domestic banks and
savings and loan associations); or (4) invest more than 10% of its total
assets in repurchase agreements or time deposits maturing in more than seven
days or in portfolio securities not readily marketable. Investors are referred
to the Statement of Additional Information for a complete description of such
restrictions and policies.
OTHER PORTFOLIO STRATEGIES
Lending of Securities
A Fund may lend its securities (but not in excess of 30% of its total assets)
to brokers, dealers and financial institutions and receive as collateral cash,
securities issued or guaranteed by the United States Government or its
agencies or instrumentalities, or letters of credit of certain banks selected
by the investment adviser, which at all times while the loan is outstanding
will be maintained in amounts equal to at least 100% of the current market
value of the loaned securities. The Fund will continue to receive interest or
dividends on the securities lent, and in addition will receive a portion of
the income generated by the short-term investment of cash received as
collateral, or, alternatively, where securities or a letter of credit are used
as collateral, a lending fee paid directly to the Fund by the borrower of the
securities. Such loans will be terminable by the Fund at any time and will not
be made to affiliates of the Fund. The Fund will have the right to regain
record ownership of loaned securities in order to exercise beneficial rights,
such as voting rights or subscription rights. The Fund may pay reasonable fees
to persons unaffiliated with the Fund for services or for arranging such
loans. Loans of securities will be made only to firms that the Investment
Adviser deems creditworthy. As with an extension of credit, however, there are
risks of delay in recovery and even loss of rights in the collateral, should
the borrower of securities default, become the subject of bankruptcy
proceedings or otherwise be unable to fulfill its obligations or fail
financially.
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Repurchase Agreements
Repurchase Agreements are more fully described in the Statement of Additional
Information. If a seller of a repurchase agreement defaults and does not
repurchase the security subject to the agreement, the Fund would look to the
collateral security underlying the sellers' repurchase agreement, including
the securities subject to the repurchase agreement, for satisfaction of the
seller's obligation to the Fund; in such event the Fund might incur
disposition costs in liquidating the collateral and might suffer a loss if the
value of the collateral declines. In addition, there is a risk that, if the
issuer of the repurchase agreement becomes involved in bankruptcy proceedings,
the Fund might be delayed or prevented from liquidating the underlying
security or otherwise obtaining it for its own purposes.
Options and Futures
As noted, the Funds may enter into transactions in options, futures contracts
and options on futures contracts on the types of instruments identified above.
Such transactions will be used for hedging purposes only, and not for
speculation, and could include (1) the selling of call option contracts on
portfolio securities (covered calls), and the buying of call option contracts
on such securities to close out a position acquired through the sale of such
options; (2) the buying of put option contracts on securities owned by a Fund,
and the selling of put option contracts on securities owned by a Fund to close
out a position acquired through the purchase of such options; (3) purchases
and sales of futures contracts, and purchases of options on futures contracts,
on fixed-income securities; and (4) purchases and sales of futures contracts,
and purchases of options on futures contracts, on indexes of securities. If a
hedging transaction in any such instrument is successful, a Fund's losses on
portfolio securities, or the increased cost of securities to be acquired,
should be offset, in whole or part, by corresponding gains on the hedging
position. The Funds will only enter into transactions in options, futures and
options on futures which are traded on securities or commodities exchanges
located in the United States.
A risk in all such transactions is a possible lack of liquidity, which could
make it difficult or impossible to close out existing positions and realize
gains or limit losses. The liquidity of a secondary market in futures
contracts or options on futures contracts may be adversely affected by "daily
price fluctuation limits," established by the exchanges on which such
instruments are traded, which limit the amount of fluctuation in the price of
a contract during a single trading day. Once the limit in a particular
contract has been reached, no further trading in such contract may occur
beyond such limit, thus preventing the liquidation of positions, and requiring
traders to make additional variation margin payments. Market liquidity in
options, futures contracts or options on futures contracts may also be
adversely affected by trading halts, suspensions, exchange or clearing house
equipment failures, government intervention, insolvency of a brokerage firm or
clearing house or other disruptions of normal trading activity.
The Funds are also subject to the risk of imperfect correlation between
securities held in their portfolios and the security or securities underlying
options, futures contracts or options on futures contracts traded. In the case
of options, futures contracts or options on futures based on an index of
securities, a Fund's portfolio will not duplicate the composition of the index
and, in the case of options, futures contracts and options on futures
contracts on fixed income securities, the portfolio securities being hedged
may not be the same as the securities underlying such instruments.
Consequently, the Funds bear the risk that the price of the portfolio
securities being hedged will not move in the same amount or direction as the
underlying index or obligation.
A Fund may sell futures contracts on fixed-income securities in anticipation
of a rise in interest rates, which would cause a decline in the value of
fixed-income securities held in the Fund's portfolio. Similarly, a Fund may
sell stock index futures contracts in anticipation of a general market wide
decline which would reduce the value of its portfolio of stocks. In either
case, if the expected decrease in the value of portfolio securities occurs,
the reduction in net asset value may be offset, in whole or in part, by
corresponding gains on the futures position. Conversely, where a Fund projects
an increase in the cost of fixed-income securities or stocks to be acquired in
the future, the Fund may purchase futures contracts on fixed-income securities
or stock indexes. If the hedging transaction is successful, the increased cost
of securities subsequently acquired should be offset, in whole or in part, by
gains on the futures position.
A Fund may also, instead of purchasing or selling futures contracts, purchase
call or put options on futures contracts in order to protect against declines
in the value of portfolio securities or against increases in the cost of
securities to be acquired. Purchases of options on futures contracts may
present less risk in hedging a portfolio than the purchase and sale of the
underlying futures contracts, since the potential loss is limited to the
amount of the premium paid for the option, plus related transaction costs. As
in the case of purchases and sales of futures contracts, a Fund may be able to
offset declines in the value of portfolio securities, or increases in the cost
of securities acquired, through gains realized on its purchases of options on
futures.
The Funds may also purchase put options on securities or stock indexes for the
same types of hedging purposes. The purchase of a put option on a security or
stock index permits a Fund to protect against declines in the value of the
underlying
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security or securities in a manner similar to the sale of futures contracts.
The maximum risk assumed by a Fund in purchasing an option is the amount of the
premium plus related transaction costs, although this entire amount may be
lost.
In addition, the Funds may write call options on portfolio securities or on
stock indexes for the purpose of increasing their returns and/or to protect the
value of their portfolios. In particular, where a Fund writes an option which
expires unexercised or is closed out by the Fund at a profit, it will retain
the premium paid for the option, less related transaction costs, which will
increase its gross income and will offset in part the reduced value of a
portfolio security in connection with which the option may have been written.
In contrast, however, if the price of the security underlying the option moves
adversely to the Fund's position, the option may be exercised and the Fund will
be required to sell the security at a disadvantageous price, resulting in
losses which may be only partially offset by the amount of the premium. A call
option on a security written by a Fund will be covered through ownership of the
security underlying the option or through ownership of an absolute and
immediate right to acquire such security upon conversion or exchange of other
securities held in its portfolio.
The Funds' hedging transactions and options on futures present certain other
risk factors which are described in the Statement of Additional Information.
Foreign Securities and ADRs
In addition to investing in domestic securities, the Funds may also invest in
securities of foreign issuers (including such securities traded outside the
United States). None of the Funds will, however, trade in foreign exchange or
invest in securities of foreign issuers, if at the time of acquisition more
than 20% of its total assets, taken at market value at the time of investment,
would be invested in such securities. Because investments in foreign
securities, particularly those of non-governmental issuers, involve
considerations which are not ordinarily associated with investing in domestic
issuers, the Investment Company will consider these special factors before
investing in foreign securities. These considerations include changes in
currency rates, currency exchange control regulations, the possibility of
expropriation, the unavailability of financial information or the difficulty of
interpreting financial information prepared under foreign accounting standards,
less liquidity and more volatility in foreign securities markets, the impact of
political, social or diplomatic developments and the difficulty of assessing
economic trends in foreign countries. If it should become necessary, the Funds
could encounter greater difficulties in involving legal processes abroad than
would be encountered in the United States. In addition, transaction costs in
foreign securities may be higher. The Investment Company will not invest in
foreign securities unless, in its opinion, such investments will meet the
standard and objectives of a particular Fund. No Fund may concentrate its
investments in any particular foreign country except Canada. Foreign issues
guaranteed by domestic corporations are considered to be domestic securities.
ADRs are dollar-denominated receipts issued generally by domestic banks and
representing the deposit with the bank of a security of a foreign issuer. ADRs
are publicly traded on exchanges or over-the-counter in the United States. ADRs
are not subject to the percentage limitations contained in the preceding
paragraph.
Mortgage-Backed Securities
The Bond Funds may invest in mortgage-backed securities, some of which are also
considered to be U.S. Government securities. These securities represent
interests in, or are secured by, pools of mortgage loans and provide holders
with payments consisting of both interest and principal as the mortgages in the
underlying mortgage pools are paid off.
Mortgage-backed securities include securities guaranteed by the Government
National Mortgage Association ("Ginnie Maes"), securities issued by the Federal
National Mortgage Association ("Fannie Maes"), participation certificates
issued by the Federal Home Life Mortgage Corporation ("Freddie Macs") and
collateralized mortgage obligations issued by a Government instrumentality or
agency ("CMOs"). The timely payment of principal and interest is backed by the
full faith and credit of the U.S. Government in the case of Ginnie Maes but not
for Fannie Maes, Freddie Macs or CMOs.
Unscheduled or early payments on the underlying mortgages may shorten the
effective maturities and impact the yield and price of mortgage-backed
securities. A decline in interest rates may lead to increased prepayment of the
underlying mortgages, and the Funds may have to reinvest proceeds received at
lower rates of return. Characteristics of underlying mortgage pools will vary,
and it is not possible to predict completely accurately the realized yield or
average life of a particular mortgage-backed security because of the principal
prepayment feature.
Convertible Securities
Certain Funds may invest in convertible securities, which normally provide a
higher yield than the underlying stock but a lower yield than a fixed-income
security without the convertibility feature. The price of the convertible
security normally will vary to some degree with changes in the price of the
underlying stock, although the higher yield tends to make the convertible
security less volatile than the underlying common stock. The price of the
convertible security also will vary to some degree inversely with interest
rates.
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INSURANCE LAW RESTRICTIONS
In order for shares of the Investment Company's Funds to remain eligible
investments for the Separate Accounts, it may be necessary, from time to time,
for a Fund to limit its investments in certain types of securities in
accordance with the insurance laws or regulations of the various states in
which the Contracts are sold. Such laws and restrictions as are currently in
effect may limit the Funds' investments in foreign securities and in debt or
equity securities of certain issuers.
INVESTMENT ADVISORY ARRANGEMENTS
THE ADVISER
Subject to the direction and control of the Board of Directors of the
Investment Company, Mutual of America Capital Management Corporation, 320 Park
Avenue, New York, New York 10022 (the "Adviser"), an indirect wholly-owned
subsidiary of Mutual of America Life, manages the investment and reinvestment
of the assets of each Fund pursuant to the Investment Advisory Agreement (the
"Agreement") between the Investment Company and the Adviser. Prior to November
3, 1993, Mutual of America Life was the investment adviser to the Investment
Company; Mutual of America Life's obligations under the Agreement were assumed
by the Adviser on that date. The Adviser had total assets under management of
approximately $7.6 billion at December 31, 1996.
The Adviser's duties as investment adviser also include research, making
recommendations to the Board of Directors of the Investment Company and
placing orders for the purchase and sale of securities (see "The Funds'
Expenses"). The Adviser is obligated to provide all of the office space,
facilities, equipment, material and personnel necessary to perform its duties
under the Agreement. Under the Subadvisory Agreements, the Adviser has
delegated its investment advisory responsibilities to the Subadvisers and is
responsible for providing management services to the respective Funds. See
"The Subadvisers" below.
As compensation for its investment advisory services to each of the Funds of
the Investment Company, the Adviser will receive a fee calculated as a daily
charge at the annual rates of .125% of the value of the net assets in the
Equity Index Fund; .25% of the value of the net assets in the Money Market
Fund; .50% of the value of the net assets in the All America, Bond, Short-Term
Bond, Mid-Term Bond and Composite Funds; and .85% of the value of the net
assets in the Aggressive Equity Fund. The Adviser pays the Subadvisers for
their investment advisory services. See "The Subadvisers" below. During 1996,
the Adviser paid all of the expenses of the Funds other than investment
advisory fees, brokerage commissions and portfolio transaction costs. See "The
Funds' Expenses."
THE SUBADVISERS
PALLEY-NEEDELMAN, 800 Newport Center Drive, Suite 450, Newport Beach,
California 92660, serves as Subadviser for approximately 10% of the assets
allocated to the All America Fund. Palley-Needelman is jointly owned by Roger
B. Palley and Chet J. Needelman, both of whom have extensive experience in
investment management. It provides investment management services to
institutional, corporate and individual clients and other registered
investment companies. At December 31, 1996, Palley-Needelman managed
approximately $4.1 billion in assets.
OAK ASSOCIATES, 3875 Embassy Parkway, Suite 250, Akron, Ohio 44333, serves as
Subadviser for approximately 10% of the assets allocated to the All-America
Fund. Oak Associates is an Ohio limited liability company that prior to 1996
was a sole proprietorship of James Dravo Oelschlager doing business as Oak
Associates. It provides investment management services for individual and
corporate clients, primarily in connection with retirement plans. At December
31, 1996, Oak Associates had assets under management of approximately $5
billion.
ALGER MANAGEMENT, 75 Maiden Lane, New York, New York 10038, serves as
Subadviser for approximately 10% of the assets allocated to the All America
Fund. Alger Management is a wholly-owned subsidiary of Fred Alger & Company,
Incorporated, which is owned by Alger Associates, Inc. Fred M. Alger III and
David D. Alger are the majority shareholders of Alger Associates, Inc. and may
be deemed to control that company and its subsidiaries. Alger Management
provides investment management services to institutional, corporate and
individual clients, including other registered management investment
companies. At December 31, 1996, Alger Management had approximately $7.2
billion in assets under management.
Under the Subadvisory Agreements, each Subadviser, at its own expense and
subject to the supervision of the Adviser and the Board of Directors of the
Investment Company, renders investment advisory services and assumes the
Adviser's duties including research, making recommendations and regular
reports to the Adviser and the Board of Directors of the Investment Company
and maintenance of certain records. The Subadvisers are also obligated to
provide all of the office space, facilities, equipment, material and personnel
necessary to perform their duties under the Subadvisory Agreements. The
Adviser, and not the Funds, will pay to the Subadvisers an amount calculated
daily at the following annual rates: Palley-Needelman, .30%;
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<PAGE>
Oak Associates, .30%; and Alger Management, .45%; of the value of the net
assets for which the Subadviser is providing investment advisory services.
PORTFOLIO MANAGERS
Set forth below is information about the person or persons employed by the
Adviser or Subadvisers who are primarily responsible for the day-to-day
management of the Funds' investments. No information is given for the Money
Market Fund, the Equity Index Fund or the Indexed Assets portion of the All
America Fund based on the nature of the investments made by those Funds.
ALL AMERICA FUND. The Active Assets of the All America Fund are managed by
three Subadvisers and the Adviser:
Chet J. Needelman, Chief Executive Officer and Senior Investment Officer of
Palley-Needelman, is responsible for the day-to-day management of the Palley-
Needelman portion of the Fund. Mr. Needelman has over 28 years of investment
experience as a security analyst, research director and portfolio manager. He
has managed funds for foundations, corporations, endowments and mutual funds.
He is the co-founder of Palley-Needelman Asset Management and its predecessor
company, where he held various positions during the last 21 years. All
investment decisions for Palley-Needelman Asset Management are made by an
investment committee which includes Mr. Needelman, Mr. Palley and three other
senior investment professionals.
James D. Oelschlager is the portfolio manager of the Oak Associates portion of
the Fund. Since establishing Oak Associates in 1985, Mr. Oelschlager has
served as its portfolio manager. Previously, he served as the Assistant
Treasurer of Firestone Tire & Rubber Company, where he was directly
responsible for the management of the company's pension assets. Mr.
Oelschlager is assisted with portfolio management responsibilities by Donna
Barton, trading, Margaret Ballinger, new accounts, and Doug MacKay, equity
research. These individuals have combined experience of over sixty years in
the investment business and play a key role in the day-to-day management of
the firm's portfolios.
David D. Alger, President and Chief Executive Officer of Alger Management, is
primarily responsible for the day-to-day management of the Alger Management
portion of the Fund. He has been employed by Alger Management as Executive
Vice President and Director of Research since 1971 and as President since
1995, and he serves as portfolio manager for other mutual funds and investment
accounts managed by Alger Management.
Frederick M. Gallagher, Senior Vice President of the Adviser since June 1995,
is responsible for the investments of the Adviser's portion of the Active
Assets of the Fund. Mr. Gallagher's previous position prior to joining the
Adviser was as Senior Vice President/Equity Investments at Continental Asset
Management Corporation. He has more than 30 years of experience in the
investment management business.
BOND FUND, SHORT-TERM BOND FUND AND MID-TERM BOND FUND. For each of the Bond
Funds, Andrew L. Heiskell, Executive Vice President of the Adviser, has
responsibility for setting the fixed income investment strategy and overseeing
the Fund's day-to-day operations. He has been the portfolio manager for the
Bond Fund since February 1991 and of the Mid-Term and Short-Term Bond Funds
since their inception. Mr. Heiskell has over 25 years of investment experience
and joined Mutual of America Life in February of 1991, where he was Senior
Vice President until January 1, 1994. Prior to joining Mutual of America Life,
Mr Heiskell was employed by M. D. Sass, Inc.
COMPOSITE FUND. I. Charles Rinaldi, Senior Vice President of the Adviser, is
responsible for the day-to-day operations of the equity portion of the Fund,
and Andrew L. Heiskell, Executive Vice President of the Adviser, is
responsible for the day-to-day operations of the fixed-income portion of the
Fund. Mr. Rinaldi joined Mutual of America Life in November of 1989, and Mr.
Heiskell joined in February of 1991, where they were Vice President and Senior
Vice President, respectively, until January 1, 1994. Prior to joining Mutual
of America Life, Mr. Heiskell was employed by M. D. Sass, Inc. and Mr Rinaldi
was employed by Glickenhaus & Co.
AGGRESSIVE EQUITY FUND. I. Charles Rinaldi, Senior Vice President of the
Adviser, has responsibility for setting the investment strategy and overseeing
the day-to-day operations of the Aggressive Value Portfolio and the Aggressive
Growth Portfolio of the Aggressive Equity Fund. Mr. Rinaldi joined Mutual of
America Life in November of 1989, where he was Vice President until January 1,
1994. Prior to joining Mutual of America Life, Mr. Rinaldi was employed by
Glickenhaus & Co.
THE FUNDS' EXPENSES
Each Fund is charged with brokers' commissions, transfer taxes and other fees
relating to that Fund's portfolio transactions, pursuant to the Investment
Advisory Agreement between the Investment Company and the Adviser. In
addition, the Fund is responsible for a number of expenses relating to its
operations, including: directors' fees and expenses; the fees and expenses of
its independent certified public accountants and of its legal counsel;
printing and mailing costs of semi-annual reports to
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<PAGE>
shareholders, Proxy Statements, Prospectuses, Prospectus Supplements and
Statements of Additional Information; printing of registration statements;
bank transaction charges and custodian's fees; proxy solicitors' fees and
expenses, SEC filing fees; any federal, state or local income or other taxes;
any membership fees of the Investment Company Institute and similar
organizations; fidelity bond and directors' liability insurance premiums; and
any extraordinary expenses, such as indemnification payments or damages
awarded in litigation or settlements made. The Adviser voluntarily limits the
expenses of each Fund, other than for brokers' commissions, transfer taxes and
other fees relating to portfolio transactions, to the amount of the investment
advisory fee paid by the Fund to the Adviser. The Adviser may discontinue
making such reimbursements or payments at any time.
PORTFOLIO TRANSACTIONS
The Adviser is responsible for decisions to buy and sell securities for the
Investment Company as well as for selecting brokers and, where applicable,
negotiating the amount of the commission rate paid. In placing orders, it is
the policy of the Investment Company to obtain the best price and execution
for its contracts.
The Adviser and Subadvisers place orders in connection with the purchase and
sale of approved investments with various brokers, including their affiliates.
As a general matter, the Adviser and each Subadviser select broker-dealers
which, in its best judgment, provide prompt and reliable execution at
favorable security prices and reasonable commission rates. They may select
broker-dealers which provide them with research services and may cause a Fund
to pay such broker-dealers commissions which exceed those other broker-dealers
may have charged, if in their view the commissions are reasonable in relation
to the value of the brokerage and/or research services provided by the broker-
dealer. Brokerage arrangements with affiliates of the Adviser or the Sub-
Advisers will be in accordance with the 1940 Act and the rules and regulations
promulgated thereunder. No transactions may be effected by a Fund with an
affiliate of the Adviser or a Sub-Adviser acting as principal for its own
account. When purchasing or selling securities trading on the over-the-counter
market, the Adviser and Subadvisers will generally execute the transaction
with a broker engaged in making a market for such securities.
PURCHASE OF SHARES
The Investment Company is offering shares in the Funds, without sales charge,
at present only for purchase by the Insurance Companies for allocation to the
Separate Accounts to fund benefits under the Contracts. The Investment Company
continuously offers shares at prices equal to the respective per share net
asset value of the Funds. Net asset value is determined in the manner set
forth below under "Additional Information--Determination of Net Asset Value."
REDEMPTION OF SHARES
The Investment Company is required to redeem all full and fractional shares of
the Funds for cash. The redemption price is the net asset value per share next
determined after the initial receipt of proper notice of redemption. Payment
upon redemption of Fund shares is normally made within seven days of receipt
of such request (unless redemption is suspended or payment is delayed as
permitted in accordance with SEC regulations).
DIVIDENDS, DISTRIBUTIONS AND TAXES
The Investment Company has in the past elected the special tax treatment
afforded a "regulated investment company" under certain provisions of the
Internal Revenue Code (the "Code"). The Investment Company believes it has
qualified for such treatment and intends to continue to qualify therefor. If
it so qualifies, the Investment Company will not be subject to Federal income
tax on that part of its ordinary income and net realized capital gains which
it distributes to shareholders, thereby avoiding any Federal income tax
liability. Such dividend distributions will be declared and reinvested in
additional full and fractional shares of the Fund to which they relate,
annually, both in the case of net investment income and in the case of net
realized short- or long-term capital gains.
For dividend purposes, the net investment income of each Fund will consist of
dividends received and interest accrued by such Fund, plus or minus any
amortized discount or premium, less the estimated expenses of such Fund. To
qualify for treatment as a regulated investment company, the Investment
Company must, among other things, derive in each taxable year at least 90% of
its gross income from dividends, interest, gains from the sale or other
disposition of stock or securities, including foreign securities, and other
income derived with respect to the business of investing in stock or
securities. In addition, the Investment Company must derive less than 30% of
its gross income in each taxable year from the disposition of options, futures
and forward contracts or financial investments and foreign currencies, as well
as stocks and securities, in each case held for less than three months. For
purposes of these tests, gross income is determined without regard to losses
15
<PAGE>
from the sale or other disposition of stock or securities. Since the
Investment Company has more than one Fund, each Fund will be treated as a
separate corporation for Federal income tax purposes. Therefore, the
investments and results of each Fund must satisfy the foregoing requirements
independently.
Although the Investment Company intends to operate so that it will have no
Federal income tax liability, if any such liability is nevertheless incurred,
the investment performance of the Investment Company will be adversely
affected.
The Investment Company intends to distribute all net realized long- or short-
term capital gains, if any, to the shareholders of the Fund or Funds to which
such gains are attributable. Realized capital gains and losses of each Fund
are computed separately for the purpose of determining capital gain
distributions. The net capital gain of one Fund will not be reduced by any net
capital losses incurred by the other Funds. Each Fund which has a net capital
gain will be entitled to distribute the full amount of that capital gain as a
capital gain distribution. Each Fund which has a net capital loss will be
entitled to a carryover of that loss which it can apply against its capital
gains in future years.
The tax treatment of the Insurance Companies and the Separate Accounts and the
tax implications of an investment in any Contract are described in the
prospectus or brochure for the Contract.
ADDITIONAL INFORMATION
DETERMINATION OF NET ASSET VALUE
The net asset value of the shares of each Fund (i.e., the sum of the value of
the securities held by that Fund plus any cash or other assets including
interest and dividends accrued minus all liabilities including accrued
expenses) is determined once daily by the Adviser immediately after the
declaration of dividends, if any, and is determined as of the time of the
close of trading on the New York Stock Exchange on each day during which such
Exchange is open for trading, with the exception of the Friday following
Thanksgiving and, for 1997, Friday December 26, when the Investment Company is
closed ("Valuation Day"). The net asset value per share of each Fund for any
Valuation Period (i.e., the period beginning on the close of business on the
preceding Valuation Day and ending on the close of business on the next
Valuation Day) is the amount obtained by multiplying the net asset value per
share as of the preceding Valuation Period by that Fund's Change Factor
(described below) for the period beginning on the close of business on the
preceding Valuation Day and ending on the close of business on the next
Valuation Day ("Valuation Period").
The Change Factor for each Fund for any Valuation Period is determined as:
(a) the ratio of (i) the net asset value of the Fund at the end of the
current Valuation Period, before any amounts are allocated to or withdrawn
from the Fund with respect to that Valuation Period, to (ii) the net asset
value of the Fund at the end of the preceding Valuation Period, after all
allocations and withdrawals were made for that period, divided by
(b) 1.00000 plus the component of the annual rate of the Investment
Adviser's fee against a Fund's assets for the number of days from the end
of the preceding Valuation Period to the end of the current Valuation
Period (see "Investment Advisory Arrangements").
The value of the assets held in the Investment Company will be determined in
the following manner. Investments for which market quotations are readily
available are valued at the market value of such investments (except that, as
discussed below, money market securities with a remaining maturity of 60 days
or less may be valued at amortized cost). An equity security will be valued at
the last sale price for such security on the principal exchange on which such
security is traded, or at the last bid price on the principal exchange on
which such security is traded if such bid price is of a more recent day than
the last sale price. For any equity security not traded on an exchange but
traded in the over-the-counter market, the value will be the last sale price
available, or if no sale, at the latest available bid price. Debt securities
will be valued at a composite fair market value, "evaluated bid," which may be
the last sale price, by a valuation service selected by the Adviser. Portfolio
securities or assets for which market quotations are not readily available
will be valued at fair value as determined in good faith by the Investment
Adviser under the direction of the Board of Directors of the Investment
Company.
Money market securities held by the Investment Company with a remaining
maturity of 60 days or less will be valued on an amortized cost basis, which
approximates market value; provided, however, that if the value determined
under the amortized cost method is materially different from the actual market
value, then even such short-term money market securities will be valued at
market value. Under the amortized cost method of valuation, the security is
initially valued at cost on the date of purchase (or in the case of securities
initially purchased with more than 60 days remaining to maturity, the market
value on the 61st day prior to maturity), and thereafter the Investment
Company assumes a constant proportionate amortization in value until maturity
of any discount or premium. For purposes of this method of valuation, the
maturity of a variable rate certificate of deposit is deemed to be the next
coupon date on which the interest rate is to be adjusted.
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Portfolio investments underlying options are valued as described above. Stock
options written by a Fund are valued at the mean of the last bid and asked
price on the principal exchange where the option is traded, as of the close of
trading on that exchange. The Fund's net value will be increased or decreased
by the difference between the premiums received on writing options and the
costs of liquidating such positions measured by the closing price of the
option on the exchange where traded.
When a Fund writes a call option, the amount of the premium is included in the
Fund's assets and an amount is included in its liabilities. The liability
thereafter is adjusted to the current market value of the call. For example,
if the current market value of the call exceeds the premium received, the
excess would be unrealized depreciation; conversely, if the premium exceeds
the current market value, such excess would be unrealized appreciation. If a
call expires or if the Fund enters into a closing purchase transaction, it
realizes a gain (or a loss if the cost of the transaction exceeds the premium
received when the call was written) without regard to any unrealized
appreciation or depreciation in the underlying securities, and the liability
related to such call is extinguished. If a call is exercised, the Fund
realizes a gain or loss from the sale of the underlying securities and the
proceeds of the sale increased by the premium originally received.
A premium paid on the purchase of a put will be deducted from a Fund's assets
and an equal amount will be included as an investment and subsequently
adjusted to the current market value of the put. For example, if the current
market value of the put exceeds the premium paid, the excess would be
unrealized appreciation; conversely, if the premium exceeds the current market
value, such excess would be unrealized depreciation.
Futures contracts, and options thereon, which are traded on commodities
exchanges, are valued at their official settlement price as of the close of
such commodities exchanges.
DESCRIPTION OF THE INVESTMENT COMPANY'S SHARES
The authorized capital stock of the Investment Company consists of one billion
shares of common stock, $.01 par value. The shares of common stock are divided
into eight classes of common stock: Money Market Fund, All America Fund,
Equity Index Fund, Bond Fund, Short-Term Bond Fund, Mid-Term Bond Fund,
Composite Fund and Aggressive Equity Fund. The Investment Company may
establish additional Funds and may allocate its shares either to such new
classes or to one or more of the eight existing classes.
All shares of common stock, of whatever class, are entitled to one vote, and
the votes of all classes are cast on an aggregate basis, except on matters
where the interests of the Funds differ. In such a case, the voting is on a
Fund-by-Fund basis. Approval or disapproval by the shareholders of one Fund on
such a matter would not generally be a prerequisite of approval or disapproval
in another Fund. Shareholders in a Fund not affected by a matter generally
would not be entitled to vote on that matter. Examples of matters which would
require a Fund-by-Fund vote are changes in the fundamental investment policy
of a particular Fund and approval of the Investment Advisory Agreement or a
Subadvisory Agreement for the Fund.
The shares of each Fund, when issued, will be fully paid and nonassessable and
will have no preference, preemptive, conversion, exchange or similar rights.
Shares do not have cumulative voting rights.
Each issued and outstanding share in a Fund is entitled to participate equally
in dividends and distributions declared by such Fund and in the net assets of
such Fund upon liquidation or dissolution remaining after satisfaction of
outstanding liabilities. Accrued liabilities which are not allocable to one or
more Funds will generally be allocated among the Funds in proportion to their
relative net assets. In the unlikely event that any Fund incurred liabilities
in excess of its assets, the other Funds could be liable for such excess.
INDEPENDENT AUDITORS
Arthur Andersen LLP, Certified Public Accountants, have been selected as the
independent auditors of the Investment Company for its fiscal year ending
December 31, 1997. Arthur Andersen LLP also acts as the independent auditors
of the Insurance Companies.
CUSTODIAN
The Chase Manhattan Bank, N.A., New York, New York, acts as Custodian of the
Investment Company's assets for the Funds.
LEGAL COUNSEL
Graham & James LLP, New York, New York, is counsel for the Investment Company.
Graham & James LLP, is also counsel for Mutual of America Life with respect to
its Separate Accounts No.1 and No.2.
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REPORTS TO SHAREHOLDERS
The fiscal year of the Investment Company ends on December 31 of each year.
The Investment Company will send to its shareholders at least semiannually
reports showing the Funds' portfolio securities and other information. An
annual report containing financial statements, audited by independent
certified public accountants, will be sent to shareholders each year.
INQUIRIES
All inquiries pertaining to the Investment Company's shares should be made in
writing to Mutual of America Investment Corporation, 320 Park Avenue, New
York, New York 10022.
ADDITIONAL INFORMATION AVAILABLE
This Prospectus does not contain all the information included in the
Registration Statement filed with the Securities and Exchange Commission under
the Securities Act of 1933 and the Investment Company Act of 1940, with
respect to the securities offered hereby, certain portions of which have been
omitted pursuant to the rules and regulations of the Securities and Exchange
Commission.
The Statement of Additional Information, dated May 1, 1997, which forms a part
of the Registration Statement, is incorporated by reference into this
Prospectus. The Statement of Additional Information may be obtained without
charge as provided on the cover page of this Prospectus. The Registration
Statement, including the exhibits filed therewith, may be examined at the
office of the Securities and Exchange Commission in Washington, D.C.
S & P 500 INDEX
The Equity Index Fund and the Indexed Assets of the All America Fund
(together, the "Indexed Portfolios") are not sponsored, endorsed, sold or
promoted by Standard & Poor's Corporation ("S&P"). S&P makes no representation
or warranty, express or implied, to the owners of the Indexed Portfolios or
any member of the public regarding the advisability of investing in securities
generally or in the Indexed Portfolios particularly or the ability of the S&P
500 Index to track general stock market performance. S&P's only relationship
to the Investment Company is the licensing of certain trademarks and trade
names of S&P and of the S&P 500 Index which is determined, composed and
calculated by S&P without regard to the Indexed. S&P has no obligation to take
the needs of the Indexed Portfolios or the owners of the Indexed Portfolios
into consideration in determining, composing or calculating the S&P 500 Index.
S&P is not responsible for and has not participated in the calculation of the
net asset values of the Indexed Portfolios, nor is S&P a distributor of the
Indexed Portfolios. S&P has no obligation or liability in connection with the
administration, marketing or trading of the Indexed Portfolios.
S&P DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE S&P 500
INDEX OR ANY DATA INCLUDED THEREIN. S&P MAKES NO WARRANTY, EXPRESS OR IMPLIED,
AS TO RESULTS TO BE OBTAINED BY THE INDEXED PORTFOLIOS, OWNERS OF THE INDEXED
PORTFOLIOS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE S&P 500 INDEX OR
ANY DATA INCLUDED THEREIN. S&P MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND
EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OR USE WITH RESPECT TO THE S&P 500 INDEX OR ANY DATA
INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL S&P
HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL
DAMAGES (INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH
DAMAGES.
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MUTUAL OF AMERICA INVESTMENT CORPORATION
320 PARK AVENUE, NEW YORK, NEW YORK 10022
(212) 224-1600
STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1997
This Statement of Additional Information is not a prospectus. It should be read
in conjunction with the Mutual of America Investment Corporation Prospectus
dated May 1, 1997 and retained for future reference.
A copy of the prospectus to which this Statement of Additional Information
relates is available at no charge by writing the Mutual of America Investment
Corporation at the above address or by calling the telephone number listed
above.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
GENERAL INFORMATION AND HISTORY............................................ 2
INVESTMENT POLICIES AND LIMITATIONS........................................ 2
INVESTMENT RESTRICTIONS.................................................... 6
MANAGEMENT OF THE INVESTMENT COMPANY....................................... 7
INVESTMENT ADVISORY ARRANGEMENTS........................................... 8
PORTFOLIO TRANSACTIONS AND BROKERAGE....................................... 10
PURCHASE AND PRICING OF SECURITIES......................................... 11
YIELD AND PERFORMANCE INFORMATION.......................................... 12
DESCRIPTION OF CORPORATE BOND RATINGS...................................... 14
INDEPENDENT AUDITORS....................................................... 15
LEGAL MATTERS.............................................................. 15
CUSTODIAN.................................................................. 15
DISTRIBUTION ARRANGEMENTS.................................................. 15
FINANCIAL STATEMENTS....................................................... 15
</TABLE>
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GENERAL INFORMATION AND HISTORY
THE INVESTMENT COMPANY
Mutual of America Investment Corporation (the "Investment Company") is a
diversified, open-end management investment company -- a type of company
commonly known as a "mutual fund". It is registered as such under the
Investment Company Act of 1940 (the "Investment Company Act"). The Investment
Company was formed on February 21, 1986 as a Maryland corporation and offers
its shares exclusively to separate accounts of Mutual of America Life
Insurance Company ("Mutual of America Life") and Mutual of America Life's
indirect wholly-owned subsidiary, The American Life Insurance Company of New
York ("American Life"). Mutual of America Life and American Life, together,
hereinafter are sometimes referred to as the "Insurance Companies" and each,
an "Insurance Company". The separate accounts of the Insurance Companies,
together, hereinafter are sometimes referred to as the "Separate Accounts" and
each, a "Separate Account".
As a "series" type of mutual fund, the Investment Company issues separate
classes (or series) of stock, each of which represents a separate Fund of
investments. There are currently eight Funds: the Money Market Fund, the All
America Fund, the Equity Index Fund, the Bond Fund, the Short-Term Bond Fund,
the Mid-Term Bond Fund, the Composite Fund, and the Aggressive Equity Fund. As
stated in the Investment Company's Prospectus, the Investment Company is a
successor to Separate Account No. 2 of Mutual of America Life.
The Investment Company's shares are sold only to the Insurance Companies for
allocation to the Separate Accounts; thus the Insurance Companies are the only
holders of Investment Company shares and control the Investment Company.
INVESTMENT POLICIES AND LIMITATIONS
The following supplements the information contained in the Investment
Company's Prospectus concerning the investment policies and limitations of its
Funds. For information relating to the Funds' investment objectives, see
"Investment Objectives and Policies of the Funds", and for information about
the Adviser and the Subadvisers, see "Investment Advisory Arrangements" in the
Prospectus and in this Statement of Additional Information.
Fixed-income securities which are rated in the lower rating categories of the
nationally recognized rating services (Ba or lower by Moody's and BB or lower
by Standard & Poor's), or unrated securities of comparable quality, in which
the Bond Funds may to a limited extent invest, are commonly known as "junk
bonds." Junk bonds are regarded as being predominantly speculative as to the
issuer's ability to make payments of principal and interest. Investment in
such securities involves substantial risk. Junk bonds may be issued by less
creditworthy companies or by larger, highly leveraged companies, and are
frequently issued in corporate restructurings such as mergers and leveraged
buy-outs. Such securities are particularly vulnerable to adverse changes in
the issuer's industry and in general economic conditions. Junk bonds
frequently are junior obligations of their issuers, so that in the event of
the issuer's bankruptcy, claims of the holders of junk bonds will be satisfied
only after satisfaction of the claims of senior security holders. While the
junk bonds in which the Bond Funds may invest normally would not include
securities which, at the time of investment, are in default or the issuers of
which are in bankruptcy, there can be no assurance that such events would not
occur after the Bond Funds purchase a particular security, in which case the
Bond Funds may experience losses and incur costs.
Junk bonds tend to be more volatile than higher-rated fixed-income securities,
so that adverse economic events may have a greater impact on the prices of
junk bonds than on higher-rated fixed-income securities. Like higher-rated
fixed-income securities, junk bonds generally are purchased and sold through
dealers who make a market in such securities for their own accounts. However,
there are fewer dealers in the junk bond market, which may be less liquid than
the market for higher-rated fixed-income securities, even under normal
economic conditions. Also, there may be significant disparities in the prices
quoted for junk bonds by various dealers. Adverse economic conditions or
investor perceptions (whether or not based on economic fundamentals) may
impair the liquidity of this market, and may cause the prices the Bond Funds
may receive for any junk bonds to be reduced, or might cause the Bond Funds to
experience difficulty in liquidating a portion of its portfolios. Under such
conditions, judgment may play a greater role in valuing certain of the Bond
Funds' securities than in the case of securities trading in a more liquid
market.
While the Funds other than the Bond Funds do not purchase junk bonds, the
fixed-income securities they purchase may become junk bonds as a result of
impairments of the issuer's credit. In such instances, the Fund holding a junk
bond will consider disposing of it if, in management's judgment, it is in the
Fund's best interest to do so.
Reference is made to "Investment Objectives and Policies of the Funds" in the
Prospectus for a more complete discussion of the investment objectives and
policies of the Investment Company. The following is a description of the
money market securities the Money Market Fund may invest in as referred to in
the "Investment Objectives and Policies of the Funds" section of the
Prospectus.
SAI-2
<PAGE>
U.S. Government Obligations. Securities issued or guaranteed as to principal
and interest by the United States Government include a variety of Treasury
securities, which differ only in their interest rates, maturities and times of
issuance. Treasury bills have a maturity of one year or less. Treasury notes
have maturities of one to seven years and Treasury bonds generally have a
maturity of greater than five years.
Agencies of the United States Government which issue or guarantee obligations
include, among others, Export-Import Bank of the United States, Farmers Home
Administration, Federal Housing Administration, Government National Mortgage
Association, Student Loan Marketing Association, Maritime Administration,
Small Business Administration and the Tennessee Valley Authority. Obligations
of instrumentalities of the United States Government include securities issued
or guaranteed by, among others, Federal Farm Credit Banks, Federal National
Mortgage Association, Federal Home Loan Banks, Federal Home Loan Mortgage
Corporation, Federal Intermediate Credit Banks, Federal Land Banks and Banks
for Cooperatives. Some of these securities are supported by the full faith and
credit of the U.S. Treasury; others are supported by the right of the issuer
to borrow from the Treasury, while still others are supported only by the
credit of the instrumentality.
Shares of the Investment Company are not themselves insured or guaranteed by
the United States Government or any agency thereof.
Certificates of Deposit. Certificates of deposit are generally short term,
interest-bearing negotiable certificates issued by banks or savings and loan
associations against funds deposited in the issuing institution.
Time Deposits. Time deposits are deposits in a bank or other financial
institution for a specified period of time at fixed interest rate of which a
negotiable certificate is not received.
Bankers' Acceptance. A bankers' acceptance is a draft drawn on a commercial
bank by a borrower usually in connection with an international commercial
transaction (to finance the import, export, transfer or storage of goods). The
borrower is liable for payment as well as the bank, which unconditionally
guarantees to pay the draft at its face amount on the maturity date. Most
acceptances have maturities of six months or less and are traded in secondary
markets prior to maturity.
Commercial Paper. Commercial paper refers to short-term, unsecured promissory
notes issued by corporations to finance short-term credit needs. Commercial
paper is usually sold on a discount basis and has a maturity at the time of
issuance not exceeding nine months.
Variable Amount Floating Rate Notes. Variable floating rate notes are short-
term, unsecured promissory notes issued by corporations to finance short-term
credit needs. These are interest-bearing notes on which the interest rate
generally fluctuates on a weekly basis.
Corporate Debt Securities. Corporate debt securities with a remaining maturity
of less than one year tend to become extremely liquid and are traded as money
market securities. Such issues with between one and two years remaining to
maturity tend to have greater liquidity and considerably less market value
fluctuations than longer term issues.
REPURCHASE AGREEMENTS
Under a repurchase agreement, underlying debt instruments are acquired for a
relatively short period (usually not more than one week and never more than
one year) subject to an obligation of the seller to repurchase (and the
appropriate Fund to resell) the instrument at a fixed price and time, thereby
determining the yield during the Fund's holding period. This results in a
fixed rate of return insulated from market fluctuation during such period.
Accrued interest on the underlying security will not be included for purposes
of valuing a Fund's assets.
Repurchase agreements have the characteristics of loans by a Fund, and will be
fully collateralized (either with physical securities or evidence of book
entry transfer to the account of the custodian bank) at all times. During the
term of the repurchase agreement the Fund retains the security subject to the
repurchase agreement as collateral securing the seller's repurchase
obligation, continually monitors the market value of the security subject to
the agreement and requires the Fund's seller to deposit with the Fund
additional collateral equal to any amount by which the market value of the
security subject to the repurchase agreement falls below the resale amount
provided under the repurchase agreement. The Funds enter into repurchase
agreements only with member banks of the Federal Reserve System, and with
primary dealers in U.S. Government securities whose creditworthiness has been
reviewed and found satisfactory by the management of the Investment Company,
and who have, therefore, been determined to present minimal credit risk.
Securities underlying repurchase agreements will be limited to certificates of
deposit, commercial paper, bankers' acceptances, or obligations issued or
guaranteed by the United States Government or its agencies or
instrumentalities, in which the Funds may otherwise invest.
SAI-3
<PAGE>
If a seller of a repurchase agreement defaults and does not repurchase the
security subject to the agreement, the Fund would look to the collateral
security underlying the seller's repurchase agreement, including the
securities subject to the repurchase agreement, for satisfaction of the
seller's obligation to the Fund; in such event the Fund might incur
disposition costs in liquidating the collateral and might suffer a loss if the
value of the collateral declines. In addition, there is a risk that, if the
issuer of the repurchase agreement becomes involved in bankruptcy proceedings,
the Fund might be delayed or prevented from liquidating the underlying
security or otherwise obtaining it for its own purposes.
OPTIONS AND FUTURES
As described in the Prospectus, the Funds may enter into transactions in
options, futures contracts and options on futures contracts on securities and
indexes of securities for hedging purposes only. With respect to options and
futures, the Funds may engage in strategies which include buying and selling
covered calls and puts and buying and selling call options on groups of
securities and on the futures of groups of securities.
A call option is a short-term contract (generally having a duration of nine
months or less) which gives the purchaser of the option the right to purchase
the underlying security at a fixed exercise price at any time prior to the
expiration of the option regardless of the market price of the security during
the option period. As consideration for the call option, the purchaser pays a
Fund (the seller) a premium, which the Fund retains whether or not the option
is exercised. The seller of the call option has the obligation, upon the
exercise of the option by the purchaser, to sell the underlying security at
the exercise price at any time during the option period. The selling of a call
option will benefit a Fund if, over the option period, the underlying security
declines in value or does not appreciate above the aggregate of the exercise
price and the premium. However, the Fund risks an "opportunity loss" of
profits if the underlying security appreciates above the aggregate value of
the exercise price and the premium.
A Fund may close out a position acquired through selling a call option by
buying a call option on the same security with the same exercise price and
expiration date as the call option which it had previously sold on that
security. Depending on the premium for the call option purchased by the Fund,
the Fund will realize a profit or loss on the transaction.
A put option is a similar short-term contract that gives the purchaser of the
option the right to sell the underlying security at a fixed exercise price at
any time prior to the expiration of the option regardless of the market price
of the security during the option period. As consideration for the put option
a Fund (the purchaser) pays the seller a premium, which the seller retains
whether or not the option is exercised. The seller of the put option has the
obligation, upon the exercise of the option by the purchaser, to purchase the
underlying security at the exercise price at any time during the option
period. The buying of a covered put contract limits the downside exposure for
the investment in the underlying security to the combination of the exercise
price less the premium paid. The risk of purchasing a put is that the market
price of the underlying stock prevailing on the expiration date may be above
the option's exercise price. In that case the option would expire worthless
and the entire premium would be lost.
A Fund may close out a position acquired through buying a put option by
selling a put option on the same security with the same exercise price and
expiration date as the put option which it had previously bought on the
security. Depending on the premium of the put option sold by the Fund, the
Fund will realize a profit or loss on the transaction.
In addition to options (both calls and puts) on individual securities, the
Funds may purchase and sell options on indexes of securities such as the
Standard & Poor's 100 Index, the Standard & Poor's 500 Stock Index and the New
York Stock Exchange Composite Index. Options on stock indexes, like options on
individuals securities, are traded on national securities exchanges, regulated
by the Securities and Exchange Commission such as the Chicago Board Options
Exchange, the American Stock Exchange and the New York Stock Exchange. The
Funds may sell futures contracts, and purchase options on futures contracts,
on the same types of stock indexes. Options, futures contracts and options on
futures contracts can be used in anticipation of or in a general market or
market sector decline that may adversely affect the market value of a Fund's
portfolio of securities. To the extent that a Fund's portfolio of securities
changes in value in correlation with a given stock index, hedging transactions
in options, futures contracts or options on futures contracts could reduce the
risk to the portfolio of a market decline, and, by so doing, provide an
alternative to the liquidation of securities' positions in the portfolio with
resultant transactions costs. The stock index underlying an option or futures
contract assigns weighted values to the stocks involved in the index, and the
value of the index fluctuates with changes in the market values of the stocks
so included.
A futures contract on fixed income securities requires the seller to deliver,
and the purchaser to accept delivery of, a stated quantity of a given type of
fixed income security for a fixed price at a specified time in the future. A
futures contract or option on a stock index provides for the making and
acceptance of a cash settlement equal to the change in value of a hypothetical
portfolio of stocks between the time the contract is entered into and the time
it is liquidated, times a fixed multiplier. Futures contracts may be traded
domestically only on exchanges which have been designated as "contract
SAI-4
<PAGE>
markets" by the Commodity Futures Trading Commission ("CFTC"), such as the
Chicago Board of Trade. All transactions are settled through the clearing
house of the contract market, which acts as the guarantor of the performance
of each party to all futures contracts cleared.
An option on a futures contract provides the purchaser with the right, but not
the obligation, to enter into a "long" position in the underlying futures
contract (in the case of a call option on a futures contract), or a "short"
position in the underlying futures contract (in the case of a put option on a
futures contract), at a fixed price up to a stated expiration date. Upon
exercise of the option by the holder, the contract market clearing house
establishes a corresponding short position for the writer of the option, in
the case of a call option, or a corresponding long position in the case of a
put option. In the event that an option is exercised, the parties are subject
to all of the risks associated with the trading of futures contracts, such as
payment of margin deposits.
Options on futures contracts are traded on the same contract markets as the
underlying futures contracts, subject to the performance guarantee of the
contract market clearing house. A futures contract or an option on a futures
contract may be closed out prior to maturity or expiration by entering into a
liquidating transaction in the same instrument on the contract market on which
the original position was established.
Unlike a Fund purchasing or selling a security, no price is paid or received
by a Fund upon the purchase or sale of a futures contract. Initially, a Fund
will be required to deposit with the Fund's custodian in the broker's name an
amount of cash or U.S. Treasury bills equal to approximately 5% of the
contract amount. This amount is known as "initial margin." The nature of
initial margin in futures transactions is different from that of margin in
security transactions in that futures contract margin does not involve the
borrowing of funds by the customer to finance the transactions. Rather, the
initial margin is in the nature of a performance bond or good faith deposit on
the contract which is returned to a Fund upon termination of the futures
contract assuming all contractual obligations have been satisfied. Subsequent
payments, called maintenance margin, to and from the broker, will be made on a
daily or intraday basis as the price of the underlying instrument or stock
index fluctuates making the long and short positions in the futures contract
more or less valuable, a process known as mark to market. For example, when a
Fund has purchased a stock index futures contract and the price of the
underlying stock index has risen, that position will have increased in value
and the Fund will receive from the broker a variation margin payment equal to
that increase in value. Conversely, where a Fund has purchased a stock index
futures contract and the price of the underlying stock index has declined, the
position would be less valuable and the Fund would be required to make a
variation margin payment to the broker. At any time prior to expiration of the
futures contract, a Fund may elect to close the position by taking an opposite
position which will operate to terminate the Fund's position in the futures
contract. A final determination of margin is then made, additional cash is
required to be paid by or released to the Fund, and the Fund realizes a loss
or a gain.
Transactions in options, futures contracts and options on futures contracts
may increase a Fund's transaction costs and portfolio turnover rate and will
be initiated only when consistent with a Fund's investment objectives.
The trading of options, futures contracts and options on futures contracts
also involves risks, in addition to those set forth in the Prospectus. For
example, the trading of options on futures contracts entails the risk that
changes in the value of the underlying futures contract will not be fully
reflected in the value of the option. Further, the ability to profit from the
purchase of an option and liquidate the underlying futures contract, is
subject to the risks of margin payments and the availability of a liquid
market. With respect to options and options on futures contracts, the Funds
are subject to the risk of market movements between the time that the option
is exercised and the time of performance thereunder. In writing a covered call
option on a security or a stock index, the Funds also incur the risk that
changes in the value of the instruments used to cover the position will not
correlate precisely with changes in the value of the option or underlying the
index or instrument.
The exchanges on which options, futures contracts and options on futures
contracts are traded may impose limitations governing the maximum number of
positions on the same side of the market and involving the same underlying
instrument which may be held by a single investor, whether acting alone or in
concert with others (regardless of whether such contracts are held on the same
or different exchanges or held or written in one or more accounts or through
one or more brokers).
The opening of a futures position and the writing of an option are
transactions which involve substantial leverage. As a result, relatively small
movements in the price of the contract can result in substantial unrealized
gains or losses. Because the Funds will engage in transactions in options,
futures contracts and options on futures contracts on securities and indexes
of securities for hedging purposes only, any losses incurred in connection
with these transactions should, if the hedging strategy is successful, be
offset by increases in the value of securities or other assets held by the
Funds or decreases in the prices of securities or other assets the Fund
intends to acquire. Were a Fund to write options on securities or options on
stock indexes for other than hedging purposes, the margin requirements
associated with such transactions could expose the Fund to greater risk.
SAI-5
<PAGE>
Regulations of the CFTC require that a Fund enter into transactions in futures
contracts and options on futures contracts for hedging purposes only or
otherwise to limit its initial futures margins and related option premiums
paid to an amount not to exceed 5% of the value of the Fund's assets, in order
to assure that the Fund is not deemed to be a "commodity pool" and the
Investment Company is not a "commodity pool operator" as defined in CFTC
regulations.
INVESTMENT RESTRICTIONS
The following investment restrictions are fundamental policies and may not be
changed without the approval of a majority of the outstanding voting shares of
the affected Fund. None of the Funds will:
1. purchase or sell options or futures except those listed on a domestic
exchange;
2. trade in foreign exchange, or invest in securities of foreign issuers if at
the time of acquisition more than 20% of its total assets, taken at market
value at the time of the investment, would be invested in such securities
(see "Foreign Securities");
3. make an investment in order to exercise control of management over a
company (either singly or together with other Funds);
4. underwrite the securities of other companies, including purchasing
securities that are restricted under the Securities Act of 1933 ("1933
Act") or rules or regulations issued under the 1933 Act (restricted
securities cannot be sold publicly until they are registered under the 1933
Act);
5. make short sales, except when the Fund has, by reason of ownership of other
securities, the right to obtain securities of equivalent kind and amount
that will be held so long as they are in a short position,
6. purchase commodities or commodity contracts;
7. with respect to at least 75% of the value of its total assets, invest more
than 5% of its total assets in the securities of any one issuer (including
repurchase agreements with any one bank), other than securities issued or
guaranteed by the United States Government or its agencies or
instrumentalities (see the caption entitled "The Money Market Fund" in the
Prospectus for more restrictive policies relating to that fund);
8. with respect to at least 75% of the value of its total assets, purchase
more than 10% of the outstanding voting securities of an issuer, except
that such restriction shall not apply to securities issued or guaranteed by
the United States Government or its agencies or instrumentalities;
9. issue senior securities except that each Fund may borrow as described in
restriction 13 below (the issuance and sale of options and futures not
being considered the issuance of senior securities);
10. make an investment in an industry if that investment would make the Fund's
holding in that industry exceed 25% of the Fund's total assets, except for
the Bond Fund, the Short-Term Bond Fund and the Mid-Term Bond Fund, each
of which may invest up to 75% of its total assets in the electric, gas
and/or telephone utilities industries, as described under the caption
"Investment Objectives and Policies of the Funds--The Bond Fund, the
Short-Term Bond Fund and the Mid-Term Bond Fund" in the Prospectus;
11. purchase real estate or mortgages directly. The All America and Aggressive
Equity Funds may, however, buy shares of real estate investment trusts
listed on stock exchanges or reported on the National Association of
Securities Dealers Automated Quotations ("NASDAQ") system, and the Bond
Fund, the Short-Term Bond Fund and the Mid-Term Bond Fund may each buy
mortgage-backed debt issues;
12. invest more than 5% of its total assets in the securities of any one
registered investment company. A Fund may not own more than 3% of an
investment company's outstanding voting securities, and total holdings of
investment company securities may not exceed 10% of the value of a Fund's
total assets;
13. purchase any security on margin or borrow money, except from banks for
temporary purposes, or pledge its assets unless to secure such borrowing.
The Funds may borrow money from or pledge their assets to banks in order
to transfer funds for various purposes, as required, without interfering
with the orderly liquidation of securities in their portfolios, but not
for leveraging purposes. Such borrowings may not exceed 5% of the value of
a fund's total assets at market value;
14. make loans, except loans of portfolio securities (not exceeding 30% of the
value of its total assets at market value), or loans through entry into
repurchase agreements (the purchase of publicly traded debt obligations
not being considered the making of a loan);
15. invest more than 10% of its total assets in repurchase agreements or time
deposits maturing in more than seven days or in portfolio securities not
readily marketable; or
16. purchase oil and gas interests, except that the Funds may purchase
securities of issuers that invest in oil or gas interests. The Money
Market Fund will not purchase equity securities, voting securities, local
or state government securities, or corporate debt or other than those
types of securities specifically mentioned in its investment objectives.
SAI-6
<PAGE>
If a percentage restriction is adhered to at the time of investment, a later
increase or decrease in percentage beyond the specified limit resulting from a
change in values of portfolio securities or amount of net assets will not be
considered a violation.
MANAGEMENT OF THE INVESTMENT COMPANY
DIRECTORS AND OFFICERS
The Directors of the Investment Company consist of six individuals, four of
whom are not "interested persons" of the Investment Company as defined in the
Investment Company Act of 1940. The Directors of the Investment Company are
responsible for the overall supervision of the operations of the Investment
Company and perform the various duties imposed on the directors of investment
companies by the Investment Company Act of 1940. The Board of directors elects
officers of the Investment Company annually.
The Directors and Officers of the Investment Company and their principal
employment are as follows:
<TABLE>
<CAPTION>
POSITION HELD WITH PRINCIPAL OCCUPATIONS
NAME AND ADDRESS THE INVESTMENT COMPANY DURING PAST 5 YEARS
---------------- ---------------------- ------------------------------------------
<S> <C> <C>
Dolores J. Morrissey* Chairman of the Board, President, Mutual of America Securities
320 Park Avenue President Corporation, since August 1996; Executive
New York, NY 10022 and Director Vice President and Assistant to the
President of the Adviser March 1996 to
December 1996; President and Chief
Executive Officer of the Adviser from June
1994 to March 1996; Executive Vice
President of the Adviser from September
1993 until June, 1994. Executive Vice
President of Mutual of America Life until
January 1994.
Manfred Altstadt* Senior Executive Vice Senior Executive Vice President and Chief
320 Park Avenue President, Chief Financial Financial Officer since September 1993 and
New York, NY 10022 Officer, Treasurer Director since May 1993 of the Adviser.
and Director Senior Executive Vice President and Chief
Financial Officer of Mutual of America
Life and American Life.
Peter J. Flanagan Director President of The Life Insurance Council of
551 Fifth Avenue New York.
New York, NY 10176
George J. Mertz Director Retired; formerly President of National
Ridgewood, NJ 07450 Industries for the Blind.
James J. Needham Director Business Consultant to corporations on
Bridgehampton, NY financial, planning and regulatory matters
during the past five years. Formerly
United States Ambassador to Japan,
Chairman of the New York Stock Exchange
and Commissioner of the Securities and
Exchange Commission.
Howard J. Nolan Director President and C.P.O., United Way of San
P.O. Box 898 Antonio and Bexar County.
San Antonio, TX 78293
Stanley M. Lenkowicz Secretary Senior Vice President and Deputy General
320 Park Avenue Counsel of Mutual of America Life since
New York, NY 10022 March 1995; Senior Vice President and
Associate General Counsel from October
1992 to March 1995. Prior thereto, Vice
President and Counsel of Home Life
Insurance Company.
</TABLE>
SAI-7
<PAGE>
<TABLE>
<CAPTION>
POSITION HELD WITH PRINCIPAL OCCUPATIONS
NAME AND ADDRESS THE INVESTMENT COMPANY DURING PAST 5 YEARS
---------------- ---------------------- ------------------------------------------
<S> <C> <C>
Patrick A. Burns Senior Executive Vice President Senior Executive Vice President and
320 Park Avenue and General Counsel General Counsel since September 1993 of
New York, NY 10022 the Adviser. Senior Executive Vice
President and General Counsel of Mutual of
America Life and American Life since
February 1994. Prior thereto, Executive
Vice President and General Counsel of
Mutual of America Life and American Life.
</TABLE>
- -------
* Mr. Altstadt and Ms. Morrissey are "interested persons" within the meaning
of the 1940 Act.
The officers and directors of the Investment Company own none of its
outstanding shares. The Investment Company has no Audit Committee.
Pursuant to the terms of the Investment Advisory Agreement described under the
caption "Investment Advisory Arrangements", Mutual of America Capital
Management Corporation (the "Adviser"), as investment adviser, pays all
compensation of officers and employees of the Investment Company as well as
the fees of all directors of the Investment Company who are affiliated persons
of the Adviser or its affiliates. Set forth below is a table showing
compensation paid to the directors during 1996.
<TABLE>
<CAPTION>
PENSION OR TOTAL COMPENSATION FROM
AGGREGATE COMPENSATION RETIREMENT BENEFITS ESTIMATED ANNUAL INVESTMENT COMPANY AND
FROM ACCRUED AS PART OF BENEFITS UPON OTHER INVESMENT
NAME OF DIRECTOR INVESTMENT COMPANY FUND EXPENSES RETIREMENT COMPANIES IN COMPLEX
---------------- ---------------------- ------------------- ---------------- -----------------------
<S> <C> <C> <C> <C>
Manfred Altstadt........ None(1) None None None(1)
Dolores J. Morrissey.... None(1) None None None(1)
Peter J. Flanagan....... $14,860(2) None None $14,860(2)
George J. Mertz......... $15,961(2) None None $15,961(2)
James J. Needham........ $17,625(2) None None $17,625(2)
Howard J. Nolan......... $14,377(2) None None $14,377(2)
</TABLE>
- -------
(1) As an employee of the Adviser or its affiliate and as "interested persons"
of the Investment Company, Ms. Morrissey and Mr. Altstadt serve as
directors of the Investment Company without compensation.
(2) Directors who are not "interested persons" of the Investment Company
receive from the Investment Company an annual retainer of $10,000
(previously $5,000) and a fee of $750 for each Board or Committee meeting
attended. In addition, business travel and accident insurance and life
insurance of $75,000 is provided.
INVESTMENT ADVISORY ARRANGEMENTS
Investment Adviser. The Investment Company's investment adviser is Mutual of
America Capital Management Corporation (the "Adviser"), an indirect wholly-
owned subsidiary of Mutual of America Life. Prior to November 3, 1993, Mutual
of America Life was the investment adviser to the Investment Company, pursuant
to an investment advisory agreement between the Investment Company and Mutual
of America Life, as investment adviser.
Subject at all times to the supervision and approval of the Investment
Company's Board of Directors and except as discussed below under
"Subadvisers", the Adviser renders investment advisory services with respect
to the Money Market, All America, Equity Index, Bond, Short-Term Bond, Mid-
Term Bond, Composite and Aggressive Equity Funds in a manner consistent with
their stated investment policies, objectives and restrictions. In connection
therewith, the Adviser advises the Investment Company as to what investments
should be purchased and sold and places orders for all such purchases and
sales on behalf of the Investment Company. The Adviser is a registered
investment adviser.
Advisory Fees. As compensation for its investment advisory services to each of
the Funds of the Investment Company, the Adviser will receive a fee calculated
as a daily charge at the annual rates of .125% of the value of the net assets
in the Equity Index Fund; .25% of the value of the net assets in the Money
Market Fund; and .50% of the value of the net assets in the All America, Bond,
Short-Term Bond, Mid-Term Bond and Composite Funds; and .85% of the value of
the net assets in the Aggressive Equity Fund. The total amount of Investment
Advisory fees paid in 1995 by the Investment Company to Mutual of America Life
was $5,627,349, of which $211,088 was paid by the Money Market Fund;
$2,248,272 was paid by the All America Fund; $1,391,001 was paid by the Bond
Fund; $1,272,077 was paid by the Composite Fund; $40,145 was paid by the
Equity Index Fund; $14,478 was paid by the Short-Term Bond Fund; $124,503 was
paid by the Mid-Term Bond Fund; and $325,785 was paid by the Aggressive Equity
Fund. The total amount of Investment Advisory fees paid in 1996 by the
Investment Company to the Adviser was $7,181,252, of which $152,048 was paid
by the Money Market Fund;
SAI-8
<PAGE>
$2,924,546 was paid by the All America Fund; $91,790 was paid by the Equity
Index Fund; $1,544,608 was paid by the Bond Fund; $56,971 was paid by the
Short-Term Bond Fund; $163,102 was paid by the Mid-Term Bond Fund; $1,412,746
was paid by the Composite Fund; and $835,441 was paid by the Aggressive Equity
Fund.
Advisory Agreement. The Investment Advisory Agreement (the "Advisory
Agreement") was last approved by a majority of the non-interested members of
the Investment Company's Board of Directors (the "non-interested directors")
on February 23, 1993, and by a majority vote of each Fund's shareholders on
April 13, 1993. Pursuant to an assumption agreement dated November 3, 1993,
the Adviser assumed the rights and duties of Mutual of America Life under the
investment advisory agreement. Supplements to the Advisory Agreement to permit
the Adviser to enter into subadvisory agreements for the All America Fund and
Aggressive Equity Fund were approved by a majority of the non-interested
directors on November 16, 1993. The supplement relating to the All America
Fund was approved by a majority vote of the Fund's shareholders on April 14,
1994, and the supplement relating to the Aggressive Equity Fund was approved
by a vote of the Fund's shareholders on May 1, 1995.
The Advisory Agreement terminates automatically in the event of its assignment
or, with respect to any Fund, upon 60 days' notice given by the Investment
Company's Board of Directors, by the Adviser or by majority vote (as defined
in the Investment Company Act of 1940 and the rules thereunder) of the Fund's
shares. Otherwise, the Advisory Agreement will continue in force with respect
to any Fund so long as its continuance is approved at least annually by (i) a
majority of the members of the Investment Company's Board of Directors, or
(ii) a majority vote (as defined in the Investment Company Act of 1940 and the
rules thereunder) of the Fund's Shareholders; provided that in either event
such continuance will also be approved by the vote of a majority of directors
who are not interested persons (as defined in the Investment Company Act of
1940).
Under the Advisory Agreement, the Adviser agrees to provide investment
management services to the Investment Company. Such services include
performing investment research and evaluating pertinent economic, statistical
and financial data; consultation with the Investment Company's Board of
Directors and furnishing to the Investment Company's Board of Directors
recommendations with respect to the overall investment plan; implementation of
the overall investment plan, including carrying out decisions to acquire or
dispose of investments; management of investments; reporting to the Investment
Company's Board of Directors on a regular basis on the implementation of the
investment plan and the management of investments; maintaining all required
records; making arrangements for the safekeeping of assets; and providing
office space facilities, equipment, material and personnel necessary to
fulfill its obligations.
The Adviser is responsible for all expenses incurred in performing the
investment advisory services, including compensation of officers and payment
of office expenses, trading investment and investment management.
Each Fund will pay all other expenses incurred in its operation, including
brokers' commissions, transfer taxes and other fees relating to the Fund's
portfolio transactions, directors' fees and expenses, fees and expenses of its
independent certified public accountants and of its legal counsel, the cost of
the printing and mailing of semi-annual reports to shareholders, Proxy
Statements, Prospectuses, Prospectus Supplements and Statements of Additional
Information, the printing of registration statements, bank transaction charges
and custodian's fees, any proxy solicitors' fees and expenses, SEC filing
fees, any federal, state or local income or other taxes, any membership fees
of the Investment Company Institute and similar organizations, fidelity bond
and directors' liability insurance premiums, as well as any extraordinary
expenses, such as indemnification payments or damages awarded in litigation or
settlements made. The Adviser voluntarily reimburses or pays all of the
expenses of the Funds other than advisory fees, brokers' commissions, transfer
taxes and other fees relating to the Funds' portfolio transactions and paid
all such expenses in 1995. The payment of expenses results in an increase to
each Fund's yield or total return. The Adviser may discontinue or modify its
policy of paying expenses of the Funds at any time.
The Subadvisers. With respect to the management of a portion of the
approximately 30% of the assets allocated to the All America Fund (the "Active
Assets"), the Adviser engages subadvisory services of three subadvisers--
Palley-Needelman Asset Management, Inc. ("Palley-Needelman"), Oak Associates,
Ltd. ("Oak Associates") and Fred Alger Management, Inc. ("Alger Management"),
(each a "Subadviser", and together the "Subadvisers"). Each Subadviser is
registered as an investment adviser under the Investment Advisers Act of 1940.
Each of the Subadvisers, with respect to the assets for which it acts as
subadviser, shall, subject to the supervision of the Adviser and the Board of
Directors of the Investment Company, render investment advisory services and
assume the
obligations including research, making recommendations and regular reports to
the Board of Directors of the Investment Company, maintenance of records, and
providing all the office space, facilities, equipment, material and personnel
necessary to fulfill its obligations under the Subadvisory Agreement.
SAI-9
<PAGE>
Subadvisory Fees. Each of the Subadvisory Agreements provides that the Adviser
will pay to the Subadviser an amount calculated daily at the following annual
rates: Palley-Needelman, .30%; Oak Associates, .30%; and Alger Management,
.45%; of the value of the net assets for which the Subadviser is providing
investment advisory services. The Subadvisory Agreement between the Adviser
and Mitchell Hutchins Institutional Investors, Inc. ("Mitchell Hutchins") was
terminated on June 15, 1995, and the Subadvisory Agreement between the Adviser
and C.J. Lawrence/Deutsche Bank Securities Corporation ("C.J. Lawrence") was
terminated on September 30, 1995, which provided for subadvisory fees of .50%
for Mitchell Hutchins, and .50% of the first $15 million and .30% thereafter
for C.J. Lawrence, of the value of the net assets for which subadvisory
services were provided.
The fees paid to the Subadvisers during 1996 were as follows: Palley-
Needelman, $175,250; Oak Associates, $183,308; and Alger Management, $243,662.
The fees paid during 1995 by the Adviser to the Subadvisers totalled $654,396,
and the amounts to each Subadviser were Palley-Needelman, $132,923; Oak
Associates, $150,434; Alger Management, $236,298; Mitchell Hutchins, $72,875;
and C.J. Lawrence, $61,866.
Subadvisory Agreements. The Subadvisory Agreements were approved by a majority
of the non-interested directors on February 22, 1994. The Subadvisory
Agreements with the Subadvisers for the All America Fund were approved by a
majority vote of the Fund's shareholders on April 14, 1994 and by a majority
vote of the Aggressive Equity Fund's shareholders on May 1, 1994.
Each agreement terminates automatically in the event of its assignment or upon
60 days' notice given by the Investment Company's Board of Directors, by the
Adviser or by a majority vote (as defined in the Investment Company Act of
1940 and the rules thereunder) of the related Fund's shares. Otherwise, each
Subadvisory Agreement will continue in force so long as its continuance is
approved at least annually by (i) a majority of the members of the Investment
Company's Board of Directors, or (ii) a majority vote (as defined in the
Investment Company Act of 1940 and the rules thereunder) of the All America
Fund's shareholders; provided that in either event such continuance will also
be approved by the vote of a majority of directors who are not interested
persons (as defined in the Investment Company Act of 1940).
PORTFOLIO TRANSACTIONS AND BROKERAGE
The Adviser and each Subadviser are responsible for decisions to buy and sell
securities for the Funds of the Investment Company for which they provide
services as well as for selecting brokers and, where applicable, negotiating
the amount of the commission rate paid. As a general matter, the Adviser and
Subadvisers select broker-dealers which, in their best judgment, provide
prompt and reliable execution at favorable security prices and reasonable
commission rates. The Adviser and Subadvisers may place certain orders with
their affiliates, subject to the requirements of the 1940 Act.
During 1995, Mutual of America Securities Corporation, an affiliate of the
Adviser, acted as an introducing broker for certain securities transactions.
In connection with such activities, Mutual of America Securities Corporation
received $79,000, which represented approximately 7.9% of the total brokerage
commissions paid by the Investment Company and approximately 5.8% of the
aggregate dollars of transactions effected by the Investment Company. In
addition, Deutsche Bank Securities Corporation and Fred Alger & Co., each an
affiliate of a Subadviser, received brokerage commissions during 1995.
Deutsche Bank Securities Corporation received $12,000 and Alger & Co. received
$61,000, which represented approximately 1.2% and 6.1%, respectively, of the
total brokerage commissions paid by the Investment Company and approximately
1.42% and 4.52%, respectively, of the aggregate dollars of transactions
effected by the Investment Company. During 1996, Mutual of America Securities
Corporation, an affiliate of the Adviser, acted as an introducing broker for
certain securities transactions. In connection with such activities, Mutual of
America Securities Corporation received $70,708, which represented
approximately 5.5% of the total brokerage commissions paid by the Investment
Company and approximately 6.25% of the aggregate dollars of transactions
effected by the Investment Company. In addition, Fred Alger & Co., an
affiliate of a Subadviser, received brokerage commissions during 1996. Fred
Alger & Co. received $72,555, which represented approximately 5.7% of the
total brokerage commissions paid by the Investment Company and approximately
4.7% of the aggregate dollars of transactions effected by the Investment
Company. When purchasing or selling securities trading on the over-the-counter
market, the Adviser, and each Subadviser, will generally execute the
transaction with a broker engaged in making a market for such securities.
Brokerage commissions are negotiated, as there are no standard rates. All
brokerage firms provide the service of execution of the order made; some
brokerage firms also provide research and statistical data, and research
reports on particular companies and industries are customarily provided by
brokerage firms to large investors. In negotiating commissions, consideration
is given by the Adviser, and each Subadviser, to the use and value of the data
and to the quality of execution
SAI-10
<PAGE>
provided. The valuation of such data may be judged with reference to a
particular order or, alternatively, may be judged in terms of its value to the
overall management of the Investment Company.
The Adviser, and each Subadviser, will place orders with brokers providing
useful research and statistical data services if reasonable commissions can be
negotiated for the total services furnished even though lower commissions may
be available from brokers not providing such services. The Adviser, and each
Subadviser, uses these services in connection with all of its investment
activities, and some of the data or services obtained in connection with the
execution of transactions for the Investment Company may be used in managing
other investment accounts. Conversely, data or services obtained in connection
with transactions in other accounts may be used by the Adviser, and each
Subadviser, in providing investment advice to the Investment Company. To the
extent that the Adviser, and each Subadviser, uses research and statistical
data services so obtained, its expenses may be reduced and such data has
therefore been and is one of the factors considered by the Adviser, and each
Subadviser, in determining its fee for investment advisory services.
At times, transactions for the Investment Company may be executed together
with purchases or sales of the same security for other accounts of the Adviser
or a Subadviser. When making concurrent transactions for several accounts, an
effort is made to allocate executions fairly among them. Transactions of this
type are executed only when the Adviser, or a Subadviser, believes it to be in
the best interests of the affected Fund(s), as well as any other accounts
involved. However, the possibility exists that concurrent executions may work
out to the disadvantage of the Fund(s) involved.
PORTFOLIO TURNOVER
Rate of portfolio turnover will not be a limiting factor when management of
the Investment Company deems it appropriate to purchase or sell securities for
a Fund. The portfolio turnover rate in any year will depend on market
conditions.
The Money Market Fund will seek maximum return on its assets by trading to
take advantage of short-term market variations. For this reason, and because
of the short-term nature of the money market instruments that will be
purchased by the Fund, the Money Market Fund will probably have a high annual
rate of portfolio turnover that cannot be predicted (although the Money Market
Fund may be deemed not to have a calculable turnover rate for reporting
purposes because all or most of its portfolio securities are excluded under
the method of calculation of turnover rate prescribed by the Securities and
Exchange Commission).
The Aggressive Equity Fund and the Active Assets of the All America Fund
generally will not hold all of their investments for an extended period.
Since the Equity Index Fund and the Indexed Assets of the All America Fund
will each attempt to duplicate the investment results of the S&P 500 Index, it
is expected that each will hold investments generally for longer periods.
The Bond Funds may realize short-term gains to the extent such realizations
are considered advantageous in light of existing market conditions.
The types and proportions of the Composite Fund's assets are expected to
change frequently to reflect prevailing market conditions. Within the Fund, it
would be expected that the annual rate of portfolio turnover for the equity
securities invested in the Fund would be similar to the annual rate of
portfolio turnover of the Aggressive Equity Fund and the Active Assets of the
All America Fund, and the annual rate of portfolio turnover for the publicly
traded debt securities invested in by the Fund would be similar to the annual
rate of portfolio turnover of the Bond Funds.
PURCHASE AND PRICING OF SECURITIES
As stated in the Prospectus, the Investment Company will offer and sell its
shares at each Fund's per share net asset value, which will be determined in
the manner set forth below.
The net asset value of the shares of each Fund (i.e., the sum of the value of
the securities held by that Fund plus any cash or other assets including
accrued expenses) is determined once daily by the Investment Adviser
immediately after the declaration of dividends, if any, and is determined as
of the time of the close of trading on the New York Stock Exchange on each day
during which such Exchange is open for trading, with the exception of the
Friday after Thanksgiving and, for 1997, Friday December 26 when the
Investment Company is closed ("Valuation Day"). The net asset value per share
of each Fund for any Valuation Period (i.e., the period beginning on the close
of business on the preceding Valuation Day and ending on the close of business
on the next Valuation Day), is the amount obtained by multiplying the net
asset value per share as of the preceding Valuation Period by that Fund's
Change Factor (described below) for the period beginning on the
SAI-11
<PAGE>
close of business on the preceding Valuation Day and ending on the close of
business on the next Valuation Day ("Valuation Period").
The Change Factor for each Fund for any Valuation Period is determined as:
(a) the ratio of (i) the net asset value of the Fund at the end of the
current Valuation Period, before any amounts are allocated to or withdrawn
from the Fund with respect to that Valuation Period, to (ii) the net asset
value of the Fund at the end of the preceding Valuation Period, after all
allocations and withdrawals were made for that period, divided by
(b) 1.00000 plus the component of the annual rate of the Investment
Adviser's fee against a Fund's assets for the number of days from the end
of the preceding Valuation Period to the end of the current Valuation
Period (see "Investment Advisory Arrangements").
The methods used to value the assets of each Fund are set forth in the
Prospectus.
YIELD AND PERFORMANCE INFORMATION
Performance information is computed separately for each Fund in accordance
with the formulas described below. At any time in the future, total return and
yields may be higher or lower than in the past and there can be no assurance
that any historical results will continue.
Yield of the Money Market Fund. The Money Market Fund calculates a seven-day
"current yield" (eight days when the seventh prior day has no net asset value
because the Investment Company is closed on that day) based on a hypothetical
shareholder account containing one share at the beginning of the seven-day
period. The return is calculated for the period by determining the net change
in the hypothetical account's value for the period, excluding capital changes.
The net change is divided by the share value at the beginning of the period to
give the base period return. This base period return is then multiplied by
365/7 to annualize the yield figure, which is carried to the nearest one-
hundredth of one percent.
Realized capital gains or losses and unrealized appreciation or depreciation
of the assets of the Money Market Fund are included in the hypothetical
account for the beginning of the period but changes during the period are not
included in the value for the end of the period. Values also reflect asset
charges (for advisory fees) as well as brokerage fees and other expenses.
Current yields will fluctuate daily. Accordingly, yields for any given seven-
day period do not necessarily represent future results. It should be
remembered that yield depends on the type, quality, maturities and rates of
return of the Money Market Fund's investments, among other factors. The Money
Market Fund yield does not reflect the cost of insurance and other insurance
company separate account charges. It also should not be compared to the yield
of money market funds made available to the general public because they may
use a different method to calculate yield. In addition, their yields are
usually calculated on the basis of a constant one dollar price per share and
they pay out earnings and dividends which accrue on a daily basis.
The following is an example of the calculation of the Money Market Fund's
yield for the seven-day period ended December 31, 1996. Yields may fluctuate
substantially from the example shown.
1. Value for December 24, 1996
2. Value for December 31, 1996 (exclusive of capital changes)
3. Net change equals Line 1 subtracted from Line 2
4. Base period return equals Line 3 divided by Line 1
5. Current yield equals Line 4 annualized (multiplied by 365/8)
Calculation of Total Return and Average Annual Total Return. Total Return with
respect to the shares of a Fund is a measure of the change in value of an
investment in a Fund over the period covered, which assumes that any dividends
or capital gains distributions are reinvested in that Fund's shares
immediately rather than paid to the investor in cash. The formula for Total
Return with respect to a Fund's shares used herein includes four steps: (1)
adding to the total number of shares purchased by a hypothetical $1,000
investment the number of shares which would have been purchased if all
dividends and distributions paid or distributed during the period had been
immediately reinvested; (2) calculating the value of the hypothetical initial
investment of $1,000 as of the end of the period by multiplying the total
number of shares on the last trading day of the period by the net asset value
per share on the last trading day of the period; (3) assuming redemption at
the end of the period; and (4) dividing this account value for the
hypothetical investor by the initial $1,000 investment. Average Annual Total
Return is measured by annualizing Total Return over the period.
SAI-12
<PAGE>
Yield of the Bond Funds. Yield of the shares of the Bond Funds will be
computed by annualizing net investment income, as determined by the
Commission's formula, calculated on a per share basis, for a recent one-month
or 30-day period and dividing that amount by the net asset value per share of
the Fund on the last trading day of that period. Net investment income will
reflect amortization of any market value premium or discount of fixed income
securities (except for obligations backed by mortgages or other assets) over
such period and may include recognition of a pro rata portion of the stated
dividend rate of dividend paying portfolio securities. The Yield of the Fund
will vary from time to time depending upon market conditions, the composition
of the portfolio and operating expenses allocated to the Fund.
Performance Comparisons. Each Fund may from time to time include the Total
Return, the Average Annual Total Return and Yield of its shares in
advertisements or in information furnished to shareholders. The Money Market
Fund may also from time to time include the Yield and Effective Yield of its
shares in information furnished to shareholders. Any statements of a Fund's
performance will also disclose the performance of the respective separate
account issuing the Contracts.
Each Fund may from time to time also include the ranking of its performance
figures relative to such figures for groups of mutual funds categorized by
Lipper Analytical Services ("Lipper") as having the same or similar investment
objectives or by similar services that monitor the performance of mutual
funds. Each Fund may also from time to time compare its performance to average
mutual fund performance figures compiled by Lipper in Lipper Performance
Analysis. Advertisements or information furnished to present shareholders or
prospective investors may also include evaluations of a Fund published by
nationally recognized ranking services and by financial publications that are
nationally recognized such as Barron's, Business Week, CDA Technologies, Inc.,
Changing Times, Dow Jones Industrial Average, Financial Planning, Financial
World, Forbes, Fortune, Hulbert's Financial Digest, Institutional Investor,
Investors Daily, Money, Morningstar Mutual Funds, The New York Times,
Stanger's Investment Adviser, Value Line, The Wall Street Journal,
Wiesenberger Investment Company Service and USA Today.
The performance figures described above may also be used to compare the
performance of a Fund's shares against certain widely recognized standards or
indices for stock and bond market performance.
The All America Fund and Equity Index Fund will be compared to the Standard &
Poor's Composite Index of 500 Stocks (the "S&P 500 Index"), which is a market
value-weighted and unmanaged index showing the changes in the aggregate market
value of 500 stocks relative to the base period 1941-43. The S&P 500 Index is
composed almost entirely of common stocks of companies listed on the NYSE,
although the common stocks of a few companies listed on the American Stock
Exchange or traded OTC are included. The 500 companies represented include 400
industrial, 60 transportation and 50 financial services concerns. The S&P 500
Index represents about 80% of the market value of all issues traded on the
NYSE.
The Bond Fund will be compared to the Lehman Brothers Government/Corporate
Bond Index (the "Lehman Government/Corporate Index"), which is a measure of
the market value of approximately 5,300 bonds with a face value currently in
excess of $1 million, which have at least one year to maturity and are rated
"Baa" or higher ("investment grade") by a nationally recognized statistical
rating agency.
The Short-Term Bond Fund will be compared to the Salomon Brothers 1-3 Year
Bond Index, and the Mid-Term Bond Fund will be compared to the Salomon
Brothers 3-7 Year Bond Index, which are comprised of the portion of the
Salomon Brothers Broad Investment-Grade Bond Index ("BIG Index") with the
maturity indicated. The BIG Index includes Treasury, Agency, mortgage and
corporate securities. It is market-capitalization weighted and includes all
fixed-rate bonds with a maturity of one year or longer and a minimum of $50
million amount outstanding at entry which remain in the index until their
amount falls below $25 million ($200 million for mortgage securities).
The Aggressive Equity Fund will be compared to the Russell 2000 Index, which
is a market capitalization weighted index of the 2000 smallest companies in
the Russell 3000 Index. The Russell 2000 companies represent approximately 12%
of the Russell 3000 total market capitalization, and the largest company in
the Russell 2000 Index has a current market value of approximately $1 billion.
The Composite Fund will be compared to the S&P 500 Index, the Lehman
Government/Corporate Index and the 90-day Treasury bill rate.
In reports or other communications to shareholders, the Investment Company may
also describe general economic and market conditions affecting the Funds and
may compare the performance of the Funds with (1) that of mutual funds
included in the rankings prepared by Lipper or similar investment services
that monitor the performance of insurance company separate accounts or mutual
funds, (2) IBC/Donoghue's Money Fund Report, (3) other appropriate indices of
investment securities and averages for peer universe of funds which are
described in this Statement of Additional Information, or (4) data developed
by the Adviser or any of the Subadvisers derived from such indices or
averages.
SAI-13
<PAGE>
DESCRIPTION OF CORPORATE BOND RATINGS
Description of Corporate bond ratings of Moody's Investors Services, Inc.:
Aaa--Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to
as "gilt-edge". Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issues.
Aa--Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally
known as high-grade bonds. They are rated lower than the best bonds because
margins of protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may
be other elements present which make the long-term risks appear somewhat
larger than in Aaa securities.
A--Bonds which are rated A possess many favorable investment attributes and
are to be considered as upper medium grade obligations. Factors giving
security to principal and interest are considered adequate but elements may
be present which suggest a susceptibility to impairment sometime in the
future.
Baa--Bonds which are rated Baa are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest
payments and principal security appear adequate for the present but certain
protective elements may be lacking or may be characteristically unreliable
over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.
Ba--Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of
interest and principal payments may be very moderate and thereby not well
safeguarded during both good and bad times over the future. Uncertainty of
position characterizes bonds in this class.
B--Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance
of other terms of the contract over any long period of time may be small.
Caa--Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to
principal or interest.
Ca--Bonds which are rated Ca represent obligations which are speculative in
a high degree. Such issues are often in default or have other marked
shortcomings.
C--Bonds which are rated C are the lowest rated class of bonds and issues
so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.
Moody's applies numerical modifiers, 1, 2 and 3 in each generic rating
classification from Aa through B in its corporate bond rating system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the
modifier 3 indicates that the issue ranks in the lower end of its generic
rating category.
Description of corporate bond ratings of Standard & Poor's Corporation:
AAA--Debt rated AAA has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is very strong.
AA--Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the higher rated issues only in small degree.
A--Debt rated A has a strong capacity to pay interest and repay principal,
although it is somewhat more susceptible to the adverse effects of changes
in circumstances and economic conditions than debt in higher rated
categories.
BBB--Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate
protection parameters, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity to pay
interest and repay principal for debt in this category than in higher-rated
categories.
BB--B--CCC--CC--Debt rated BB, B, CCC and CC is regarded, on balance, as
predominantly speculative with respect to the issuer's capacity to pay
interest and repay principal in accordance with the terms of the
obligation. BB indicates the lowest degree of speculation and CC the
highest degree of speculation. While such debt will likely have some
quality and protective characteristics, these are outweighed by large
uncertainties or major risk exposures to adverse conditions.
C--The rating C is reserved for income bonds on which no interest is being
paid.
D--Debt rated D is in default, and payment of interest and/or repayment of
principal is in arrears.
Plus (+) or Minus (-): The ratings from "AA" to "BB" may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.
SAI-14
<PAGE>
INDEPENDENT AUDITORS
The financial statements included in this Statement of Additional Information
have been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in giving said report.
LEGAL MATTERS
The legal validity of the shares described in the Prospectus has been passed
on by Patrick A. Burns, Esq., Senior Executive Vice President and General
Counsel of the Investment Company.
CUSTODIAN
The Custodian of the Investment Company's Fund securities and other assets is
The Chase Manhattan Bank, N.A., New York, New York 10019.
DISTRIBUTION ARRANGEMENTS
The Investment Company sells its shares on a continuous basis only to the
Separate Accounts of the Insurance Companies. Such shares are sold at their
respective net asset values and without the imposition of a sales charge.
FINANCIAL STATEMENTS
Financial statements of the Investment Corporation for the year ended December
31, 1996 are included as follows:
<TABLE>
<S> <C>
President's Message........................................................ 1
Portfolio Management Discussions........................................... 2
Portfolio of Investments in Securities:
Money Market Fund........................................................ 9
All America Fund......................................................... 10
Equity Index Fund........................................................ 18
Bond Fund................................................................ 24
Short-Term Bond Fund..................................................... 27
Mid-Term Bond Fund....................................................... 29
Composite Fund........................................................... 31
Aggressive Equity Fund................................................... 36
Statement of Assets and Liabilities........................................ 40
Statement of Operations.................................................... 41
Statements of Changes in Net Assets........................................ 42
Financial Highlights....................................................... 44
Notes to Financial Statements.............................................. 50
Report of Independent Public Accountants................................... 55
</TABLE>
SAI-15
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
We are pleased to report that the results for 1996 for the funds offered by
the Mutual of America Investment Corporation were, overall, quite positive.
Over the past year, the U.S. economy grew at a moderate pace, while
inflation remained low and unemployment stayed steady at around 5.5%. The
continuing infusion of cash into the equity markets saw the Dow Jones
Industrial Average (up 28% for the year) and the Standard & Poor's 500 Stock
Index (with a gain of nearly 23% for 1996) reach record highs. In the debt
markets, short-term rates stayed fairly steady throughout the year, although
long bond rates rose nearly 75 basis points.
For 1997, the economy is expected to continue to grow, while estimates are
that inflation will hover around the 3% level. Competitive pressures continue
to be strong with low unemployment and with producers continuing to absorb
higher cost.
Shown below are the total return figures for each Fund of the Mutual of
America Investment Corporation.
TWELVE MONTHS TO DECEMBER 31, 1996
<TABLE>
<S> <C>
Money Market Fund................................................... + 5.3%
All America Fund.................................................... +20.7%
Equity Index Fund................................................... +22.7%
Bond Fund........................................................... + 3.5%
Short-Term Bond Fund................................................ + 4.9%
Mid-Term Bond Fund.................................................. + 3.9%
Composite Fund...................................................... +11.9%
Aggressive Equity Fund.............................................. +27.1%
</TABLE>
Please note that the above total return performance figures do not reflect the
deduction of Separate Account fees and expenses which are imposed by Mutual of
America Life Insurance Company and The American Life Insurance Company of New
York, respectively.
On the pages which immediately follow are brief presentations for each fund
(excepting the Money Market Fund) of its respective:
.historical total return achieved over specified periods, expressed as an
average annual rate and as a cumulative rate;
.equivalent in dollars of a $10,000 hypothetical investment at the
beginning of each specified period; and
.historical performance compared with appropriate indices.
The respective portfolios of each fund and the financial statements are
presented in the pages which then follow.
Your participation in these Funds is appreciated.
Sincerely,
/s/ Dolores J. Morrissey
Dolores J. Morrissey
Chairman of the Board and President,
Mutual of America Investment Corporation
1
<PAGE>
MONEY MARKET FUND
The Money Market Fund returned 5.3% for 1996, matching the Salomon Brothers
three-month Treasury Bill Index return. The seven-day annualized yield as of
12/31/96 was 5.36%.
ALL AMERICA FUND
The investment objective of approximately 60% of this Fund's assets is to
provide investment results that, to the extent practical, correspond to the
performance of the Standard & Poor's 500 Composite Index of 500 Stocks. The
investment objective of the remaining assets is to achieve a high level of
return by means of a diversified portfolio. These assets are managed by three
sub-advisors and by Mutual of America Capital Management Corporation.
For the year ended December 31, the Fund returned 20.7% compared to the S&P
of 23.0%.
[CHART]
All America Fund
----------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $12,072 20.7% 20.7%
Since 5/2/94 $17,045 70.4% 22.2%
5 Years $19,322 92.2% 14.1%
10 Years $35,692 256.9% 13.6%
S & P 500 Index
---------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $12,300 23.0% 23.0%
Since 5/2/94 $17,495 74.9% 23.4%
5 Years $20,296 103.0% 15.2%
10 Years $41,306 313.1% 15.2%
Blended Index*
--------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $12,144 21.4% 21.4%
Since 5/2/94
(inception) $16,971 69.7% 22.0%
* Beginning with the Fund's 1997 financial statements, the Blended Index will no
longer be used for comparative purposes. The Fund has determined that the
S & P 500 index is more standard performance index that wil facilitate an
investor's evaluation of the Fund's performance.
2
<PAGE>
EQUITY INDEX FUND
For the year ended December 31, 1996, the Equity Index Fund returned 22.7%.
This approximates the return from the S&P 500 Index. (Please note that the S&P
500 is not subject to the fees and expenses that the Equity Index Fund must
pay.) As of June 30th, Morningstar, the mutual fund rating service, increased
the rating of our fund from four stars to five stars, Morningstar's highest
rating.
The main contributors to performance in 1996 included semi-conductor,
footwear, financial, and oil and gas drilling stocks. All of these groups did
sharply better than the index. Subperformance was shown by steel, health care,
home building and trucking stocks--all of these groups had negative returns.
[CHART]
Equity Index Fund
-----------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $12,275 22.7% 22.7%
Since
Inception* $18,079 80.8% 16.4%
S & P 500
---------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $12,300 23.0% 23.0%
Since
Inception* $18,332 83.3% 16.8%
3
<PAGE>
BOND FUND
The Bond Fund seeks a high level of return consistent with preservation of
capital through investment in publicly traded debt securities. The Fund's
return has been enhanced by its focus on corporate bonds which yield more than
comparable segments of the Lehman Brothers Government/Corporate Bond Index.
For 1996, the Fund returned 3.5% versus the Index return of 2.9%.
[CHART]
Bond Fund
---------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $10,349 3.5% 3.5%
5 Years $14,726 47.3% 8.0%
10 Years $21,091 110.9% 7.7%
Lehman Bros. Gov't./Corp. Bond Index
------------------------------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $10,290 2.9% 2.9%
5 Years $14,145 41.4% 7.2%
10 Years $22,362 123.6% 8.4%
4
<PAGE>
SHORT-TERM BOND FUND
The Short-Term Bond Fund maintains an average maturity between one and three
years. Its objectives are to achieve a high total return within this maturity
constraint and to maintain principal value. For 1996, the Fund returned 4.9%,
slightly under-performing the Salomon Brothers 1-3 year Index return of 5.2%.
[CHART]
Short-Term Bond Fund
--------------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $10,494 4.9% 4.9%
Since
Inception* $11,985 19.8% 4.7%
Salomon Bros. 1-3 Year Bond Index
---------------------------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $10,516 5.2% 5.2%
Since
Inception* $12,257 22.6% 5.3%
5
<PAGE>
MID-TERM BOND FUND
The average maturity of this Fund will be between three and seven years.
Investment grade securities must be purchased with 80% of its assets and a
broad industry diversification is permitted. The Fund emphasized U.S. Treasury
securities due to the historically narrow spreads between corporate debt
securities and government debt securities in its maturity range. The Fund
returned 3.9% for 1996 matching the Salomon Brothers 3-7 year Index return of
3.9%.
[CHART]
Mid - Term Bond Fund
--------------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $10,389 3.9% 3.9%
Since
Inception* $12,510 25.1% 5.9%
Salomon Bros. 3-7 Year Bond Index
---------------------------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $10,387 3.9% 3.9%
Since
Inception* $12,669 26.7% 6.2%
6
<PAGE>
COMPOSITE FUND
The Composite Fund returned 11.9% for 1996, compared to a blended index
(stocks, bonds/Treasury Bills) return of 13.0%. The equity portion of the Fund
increased by 20.5% for the year, compared to a total return for the S&P 500 of
23%. The bond portion of the fund increased by 4.1% for the year, compared to
a 2.9% return for the Lehman Brothers Government/Corporate Index. The asset
allocation remains approximately the same since August when it was changed to
50% stocks, 35% bonds, and 15% money market instruments. Strong performance in
energy-related and transportation stocks was partially offset by poor
performance in technology and consumer staple-related issues.
[CHART]
Composite Fund
--------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $11,189 11.9% 11.9%
5 Years $16,412 64.1% 10.4%
10 Years $27,370 173.7% 10.6%
S & P 500 Index
---------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $12,300 23.0% 23.0%
5 Years $20,309 103.1% 15.2%
10 Years $41,335 313.4% 15.2%
50% S & P 500 Index / 50% Lehman Bros.
Gov't/Corp. Bond Index (Blended)*
--------------------------------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $11,295 13.0% 13.0%
5 Years $17,065 70.7% 11.3%
10 Years $30,815 208.2% 11.9%
Lehman Bros. Gov't/Corp Bond Index
----------------------------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $10,290 2.9% 2.9%
5 Years $14,145 41.4% 7.2%
10 Years $22,362 123.6% 8.4%
* Beginning with the Fund's 1997 financial statements, this blended index will
no longer be used. The Fund has determined that the S & P 500 Index and the
Lehman Brothers Government/Corporate Bond Index and the 90 - day Treasury Bill
rate, shown separately, would be more appropriate in evaluating the Fund's
performance based on the types of securities in which it invests.
7
<PAGE>
AGGRESSIVE EQUITY FUND
The Aggressive Equity Fund has approximately 50% of its assets in value
stocks and 50% in growth stocks. Overall, the Fund seeks to produce an above
average long-term return, recognizing that at times, value will outperform
growth and vice-versa. Overall results for 1996 showed a gain of 27.1%
compared to a 16.5% gain in the Russell 2000 Index. The gain in the Value
segment of the Fund was 34.4%, compared to a gain of 21.4% in the Russell 2000
Value Index. The gain in the Growth segment of the Fund was 22.3%, compared to
a gain of 11.3% in the Russell 2000 Growth Index. Positive contributors to
this year's performance included the energy, capital goods and technology
sectors.
[CHART]
Aggressive Equity Fund
----------------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $12,711 27.1% 27.1%
Since
Inception* $18,608 86.1% 26.3%
Russell 2000 Index
------------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $11,649 16.5% 16.5%
Since
Inception* $14,730 47.3% 15.7%
S & P 500 Index
---------------
Total Return
Period Growth ----------------------
Ended of Cumu- Annual
12/31/96 $10,000 lative Average
- -------- ------- ------ -------
1 Year $12,300 23.0% 23.0%
Since
Inception* $17,494 74.9% 23.4%
* Beginning with the Fund's 1997 financial statements, the S & P 500 Index will
no longer be used for comparative purposes. The Fund has determined that the
Russell 2000 Index would be more appropriate in evaluating the Fund's
performance based on the types of securities in which it invests.
8
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (MONEY MARKET FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
DISCOUNT FACE AMORTIZED
RATING* RATE MATURITY AMOUNT COST
------- -------- -------- ---------- -----------
<S> <C> <C> <C> <C> <C>
SHORT-TERM DEBT SECURITIES:
Commercial Paper (100.0%):
Air Products & Chemicals
Corp. ...................... A1/P1 5.38% 01/14/97 $1,369,000 $ 1,366,333
Air Products & Chemicals
Corp. ...................... A1/P1 5.30 01/15/97 2,340,000 2,335,146
Alabama Power Co. ........... A1/P1 5.32 02/06/97 2,740,000 2,725,373
Associates Corp. ............ A1+/P1 5.31 01/21/97 3,500,000 3,489,614
Baltimore Gas & Electric
Co. ........................ A1/P1 5.31 01/10/97 3,150,000 3,145,795
Banc One Funding............. A1/P1 5.31 01/07/97 400,000 399,643
Bell Atlantic Capital Fund-
ing......................... A1/P1 5.70 01/15/97 725,000 723,391
Bell Atlantic Capital Fund-
ing......................... A1/P1 5.60 01/29/97 600,000 597,382
Daimler-Benz NA.............. A1/P1 5.30 02/04/97 1,000,000 994,965
Daimler-Benz NA.............. A1/P1 5.30 01/08/97 2,180,000 2,177,725
Ford Motor Credit Corp. ..... A1/P1 5.31 01/09/97 3,500,000 3,495,819
Gannett, Inc. ............... A1/P1 5.35 01/13/97 505,000 504,096
General Electric Capital
Corp. ...................... A1+/P1 5.30 01/07/97 835,000 834,257
General Electric Capital
Corp. ...................... A1+/P1 5.31 01/17/97 1,500,000 1,496,438
Great Lakes Chemical Corp. .. A1/P1 5.40 01/22/97 3,595,000 3,583,643
IBM Credit Corp. ............ A1/P1 5.31 01/17/97 2,200,000 2,194,776
IBM Credit Corp. ............ A1/P1 5.37 01/09/97 1,510,000 1,508,192
International Lease Fin.
Corp. ...................... A1/P1 5.50 01/17/97 2,050,000 2,044,979
International Lease Fin.
Corp. ...................... A1/P1 5.28 01/06/97 1,500,000 1,498,891
Interstate Power Corp. ...... A1/P1 5.33 01/14/97 3,500,000 3,493,219
Knight Ridder................ A1+/P1 5.30 01/06/97 2,275,000 2,273,307
Knight Ridder................ A1+/P1 5.30 01/17/97 1,400,000 1,396,665
Lucent Technologies.......... A1/P1 5.38 01/17/97 700,000 698,320
Merrill Lynch & Co., Inc. ... A1+/P1 5.44 01/21/97 1,071,000 1,067,715
Merrill Lynch & Co., Inc. ... A1+/P1 5.33 01/21/97 2,000,000 1,994,002
Morgan J.P. & Co. ........... A1+/P1 5.38 01/10/97 365,000 364,508
Morgan J.P. & Co. ........... A1+/P1 5.40 01/10/97 739,000 738,000
Northern States Power........ A1+/P1 5.30 01/07/97 2,600,000 2,597,675
Petrofina Delaware Inc. ..... A1/P1 6.50 01/02/97 1,337,000 1,336,759
PHH Corp. ................... A1/P1 5.48 01/31/97 3,025,000 3,011,142
Raytheon Co. ................ A1/P1 5.33 01/14/97 449,000 448,132
Raytheon Co. ................ A1/P1 5.34 01/17/97 2,000,000 1,995,235
Smithkline Beecham........... A1/P1 5.27 01/06/97 3,000,000 2,997,791
Sony Capital Corp. .......... A1/P1 5.50 01/22/97 2,000,000 1,993,571
Toyota Motor Credit Corp. ... A1+/P1 5.30 01/16/97 3,600,000 3,591,943
UBS Finance Del. Inc. ....... A1+/P1 7.75 01/02/97 2,475,000 2,474,467
UBS Finance Del. Inc. ....... A1+/P1 5.75 01/03/97 1,400,000 1,399,552
Warner-Lambert Co. .......... A1+/P1 5.30 01/06/97 3,500,000 3,497,391
Washington Gas Light Compa-
ny.......................... A1+/P1 5.31 01/17/97 1,000,000 997,627
Weyerhaeuser Co. ............ A1/P1 5.42 01/16/97 520,000 518,822
Weyerhaeuser Co. ............ A1/P1 5.38 01/16/97 630,000 628,584
Weyerhaeuser Co. ............ A1/P1 5.29 01/07/97 955,000 954,150
Wisconsin Electric Fuel...... A1+/P1 5.31 01/13/97 2,199,000 2,195,079
-----------
TOTAL SHORT-TERM DEBT SECURI-
TIES
(Cost: $77,780,114) 100%..... $77,780,114
===========
</TABLE>
- -------
* The ratings are provided by Standard & Poor's Corporation/Moody's Investors
Services, Inc.
9
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (ALL AMERICA FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
INDEXED PORTION:
COMMON STOCKS
3Com Corp. ............................................... 11,900 $ 873,162
Abbott Laboratories....................................... 53,400 2,710,050
Advanced Micro Devices, Inc. ............................. 9,400 242,050
Aetna, Inc. .............................................. 10,300 824,000
Ahmanson (H.F.) & Co. .................................... 7,200 234,000
Air Products & Chemicals Corp. ........................... 7,700 532,262
Airtouch Communications, Inc. ............................ 34,400 868,600
Alberto Culver Co. Cl B................................... 1,900 91,200
Albertson's, Inc. ........................................ 17,300 616,312
Alcan Aluminum Ltd. ...................................... 15,500 521,187
Alco Standard Corp. ...................................... 8,900 459,462
Alexander & Alexander Svcs. .............................. 3,100 53,862
Allegheny Teledyne Inc. .................................. 12,000 276,000
Allergan, Inc. ........................................... 4,500 160,312
AlliedSignal, Inc. ....................................... 19,400 1,299,800
Allstate Corp. ........................................... 30,500 1,765,187
Alltel Corp. ............................................. 13,000 407,875
Aluminum Co. of America................................... 11,900 758,625
Alza Corp. ............................................... 5,800 150,075
Amdahl Corp. ............................................. 8,300 100,637
Amerada Hess Corp. ....................................... 6,400 370,400
American Brands, Inc. .................................... 11,700 580,612
American Electric Power Co. .............................. 12,900 530,512
American Express Co. ..................................... 32,500 1,836,250
American General Corp. ................................... 14,000 572,250
American Greetings Corp. Cl A............................. 5,100 144,712
American Home Products Corp. ............................. 43,900 2,573,637
American Int'l. Group, Inc. .............................. 32,200 3,485,650
American Stores Co. ...................................... 10,000 408,750
Ameritech Corp. .......................................... 37,700 2,285,562
Amgen, Inc. .............................................. 18,200 989,625
Amoco Corp. .............................................. 34,200 2,753,100
Amp, Inc. ................................................ 15,100 579,462
AMR Corp. ................................................ 6,200 546,375
Andrew Corp. ............................................. 4,100 217,556
Anheuser Busch Cos., Inc. ................................ 34,300 1,372,000
Aon Corp. ................................................ 7,400 459,725
Apple Computer, Inc. ..................................... 8,500 177,437
Applied Materials, Inc. .................................. 12,300 442,031
Archer Daniels Midland Co. ............................... 37,400 822,800
Armco, Inc. .............................................. 7,300 30,112
Armstrong World Inds., Inc. .............................. 2,800 194,600
Asarco, Inc. ............................................. 2,900 72,137
Ashland, Inc. ............................................ 4,400 193,050
AT&T Corp. ............................................... 111,300 4,841,550
Atlantic Richfield Co. ................................... 11,000 1,457,500
Autodesk, Inc. ........................................... 3,100 86,800
Automatic Data Processing, Inc. .......................... 19,900 853,212
AutoZone, Inc. ........................................... 10,100 277,750
Avery Dennison Corp. ..................................... 7,200 254,700
Avon Products, Inc. ...................................... 9,100 519,837
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Baker Hughes, Inc. ....................................... 9,900 $ 341,550
Ball Corp................................................. 2,100 54,600
Baltimore Gas & Electric Co. ............................. 10,100 270,175
Banc One Corp............................................. 29,400 1,264,200
Bank of Boston Corp....................................... 10,500 674,625
Bank of New York, Inc. ................................... 26,900 907,875
BankAmerica Corp.......................................... 24,600 2,453,850
Bankers Trust New York Corp............................... 5,600 483,000
Bard (C.R.), Inc. ........................................ 3,900 109,200
Barnett Banks, Inc. ...................................... 13,400 551,075
Barrick Gold Corp......................................... 24,500 704,375
Battle Mountain Gold Co. ................................. 15,400 105,875
Bausch & Lomb, Inc. ...................................... 3,800 133,000
Baxter International, Inc. ............................... 18,700 766,700
Bay Networks, Inc. ....................................... 13,300 277,637
Becton Dickinson & Co. ................................... 8,600 373,025
Bell Atlantic Corp. ...................................... 30,100 1,948,975
BellSouth Corp............................................ 68,200 2,753,575
Bemis Co. ................................................ 3,600 132,750
Beneficial Corp........................................... 3,700 234,487
Bethlehem Steel Corp...................................... 7,700 69,300
Beverly Enterprises, Inc. ................................ 6,800 86,700
Biomet, Inc. ............................................. 7,900 119,487
Black & Decker Corp....................................... 6,000 180,750
Block (H & R), Inc. ...................................... 7,100 205,900
Boatmen's Bancshares, Inc. ............................... 10,600 683,700
Boeing Co. ............................................... 24,600 2,616,867
Boise Cascade Corp........................................ 3,300 104,775
Boston Scientific Corp.................................... 12,200 732,000
Briggs & Stratton Corp.................................... 2,000 88,000
Bristol-Myers Squibb Co. ................................. 34,400 3,741,000
Brown-Forman Corp. Cl B................................... 4,700 215,025
Browning Ferris Inds., Inc. .............................. 14,600 383,250
Brunswick Corp............................................ 6,800 163,200
Burlington Northern Santa Fe.............................. 10,500 906,937
Burlington Resources, Inc. ............................... 8,600 433,225
Cabletron Systems, Inc. .................................. 10,700 355,775
Caliber System, Inc ...................................... 2,700 51,975
Campbell Soup Co. ........................................ 16,100 1,292,025
Carolina Power & Light Co. ............................... 10,400 379,600
Case Corp................................................. 5,000 272,500
Caterpillar, Inc. ........................................ 13,200 993,300
Centex Corp. ............................................. 2,000 75,250
Central & South West Corp. ............................... 14,500 371,562
Ceridian Corp. ........................................... 4,700 190,350
Champion International Corp. ............................. 6,600 285,450
Charming Shoppes, Inc. ................................... 7,200 36,450
Chase Manhattan Corp. .................................... 30,100 2,686,425
Chevron Corp. ............................................ 44,800 2,912,000
Chrysler Corp. ........................................... 50,000 1,650,000
Chubb Corp. .............................................. 12,000 645,000
CIGNA Corp. .............................................. 5,200 710,450
Cincinnati Milacron, Inc. ................................ 2,700 59,062
Cinergy Corp. ............................................ 10,800 360,450
</TABLE>
10
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (ALL AMERICA FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
INDEXED PORTION (CONT'D):
Circuit City Stores, Inc. ................................ 6,700 $ 201,837
Cisco Systems, Inc. ...................................... 44,600 2,837,675
Citicorp.................................................. 32,300 3,326,900
Clorox Co. ............................................... 3,500 351,312
Coastal Corp. ............................................ 7,200 351,900
Coca-Cola Co. ............................................ 170,900 8,993,612
Cognizant Corp. .......................................... 11,700 386,100
Colgate-Palmolive Co. .................................... 10,100 931,725
Columbia Gas System, Inc. ................................ 3,800 241,775
Columbia HCA Healthcare Corp. ............................ 46,100 1,878,575
Comcast Corp. Cl A........................................ 22,400 399,000
Comerica, Inc. ........................................... 7,400 387,575
Compaq Computer Corp. .................................... 18,600 1,381,050
Computer Associates Intl., Inc. .......................... 25,100 1,248,725
Computer Sciences Corp. .................................. 5,200 427,050
Conagra, Inc. ............................................ 16,500 820,875
Conrail, Inc. ............................................ 5,500 547,937
Consolidated Edison Co NY, Inc. .......................... 16,100 470,925
Consolidated Natural Gas Co. ............................. 6,500 359,125
Cooper Industries......................................... 7,400 311,725
Cooper Tire & Rubber Co. ................................. 5,700 112,575
Coors (Adolph) Co. Cl B................................... 2,600 49,400
CoreStates Financial Corp. ............................... 15,300 793,687
Corning, Inc. ............................................ 15,800 730,750
CPC International, Inc. .................................. 9,900 767,250
Crane Co. ................................................ 3,200 92,800
Crown Cork & Seal Co., Inc. .............................. 8,800 478,500
CSX Corp. ................................................ 14,900 629,525
CUC International, Inc. .................................. 27,000 641,250
Cummins Engine, Inc. ..................................... 2,700 124,200
CVS Corp. ................................................ 7,300 302,037
Cyprus Amax Minerals Co. ................................. 6,400 149,600
Dana Corp. ............................................... 7,000 228,375
Darden Restaurants, Inc. ................................. 10,800 94,500
Data General Corp. ....................................... 2,700 39,150
Dayton Hudson Corp. ...................................... 14,900 584,825
Dean Witter Discover & Co. ............................... 11,000 728,750
Deere & Co. .............................................. 17,700 719,062
Dell Computer Corp. ...................................... 12,400 658,750
Delta Air Lines, Inc. .................................... 5,100 361,462
Deluxe Corp. ............................................. 5,700 186,675
Digital Equipment Corp. .................................. 10,600 385,575
Dillard Dept. Stores, Inc. ............................... 7,800 240,825
Disney (Walt) Co. ........................................ 46,600 3,244,525
Dominion Resources, Inc. ................................. 12,400 477,400
Donnelley (R.R.) & Sons Co. .............................. 10,300 323,162
Dover Corp. .............................................. 7,700 386,925
Dow Chemical Co. ......................................... 16,700 1,308,862
Dow Jones & Co., Inc. .................................... 6,600 223,575
Dresser Industries, Inc. ................................. 12,100 375,100
DSC Communications Corp. ................................. 8,100 144,787
DTE Energy Co. ........................................... 10,000 323,750
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Du Pont (E.I.) De Nemours................................. 38,700 $ 3,652,312
Duke Power Co. ........................................... 13,800 638,250
Dun & Bradstreet Corp. ................................... 11,700 277,875
Eastern Enterprises....................................... 1,400 49,525
Eastman Chemical Co. ..................................... 5,300 292,825
Eastman Kodak Co. ........................................ 22,900 1,837,725
Eaton Corp. .............................................. 5,300 369,675
Echlin, Inc. ............................................. 4,300 135,987
Echo Bay Mines, Ltd. ..................................... 9,600 63,600
Ecolab, Inc. ............................................. 4,400 165,550
Edison International...................................... 29,800 592,275
EG&G, Inc. ............................................... 3,300 66,412
EMC Corp. ................................................ 16,000 530,000
Emerson Electric Co. ..................................... 15,400 1,489,950
Engelhard Corp. .......................................... 9,900 189,337
Enron Corp. .............................................. 17,500 754,687
Enserch Corp. ............................................ 4,800 110,400
Entergy Corp. ............................................ 15,900 441,225
Exxon Corp. .............................................. 85,300 8,359,400
Federal Express Corp. .................................... 7,800 347,100
Federal Home Loan Mtge Corp. ............................. 12,300 1,354,537
Federal National Mtge. Assn. ............................. 75,000 2,793,750
Federated Department Stores............................... 14,300 487,987
Fifth Third Bancorp....................................... 7,300 458,531
First Bank System, Inc. .................................. 9,200 627,900
First Chicago NBD Corp. .................................. 21,900 1,177,125
First Data Corp. ......................................... 30,700 1,120,550
First Union Corp. ........................................ 19,500 1,443,000
Fleet Financial Group, Inc. .............................. 18,000 897,750
Fleetwood Enterprises, Inc. .............................. 2,400 66,000
Fleming Cos., Inc. ....................................... 2,600 44,850
Fluor Corp. .............................................. 5,700 357,675
FMC Corp. ................................................ 2,600 182,325
Ford Motor Co. ........................................... 81,400 2,594,625
Foster Wheeler Corp. ..................................... 2,800 103,950
FPL Group, Inc. .......................................... 12,600 579,600
Freeport-McMoran Copper Cl B.............................. 13,300 397,337
Frontier Corp. ........................................... 11,200 253,400
Fruit of the Loom, Inc. .................................. 5,300 200,737
Gannett, Inc. ............................................ 9,700 726,287
Gap, Inc. ................................................ 19,500 587,437
General Dynamics Corp. ................................... 4,300 303,150
General Electric Co. ..................................... 113,100 11,182,762
General Instrument Corp. ................................. 9,400 203,275
General Mills, Inc. ...................................... 10,800 684,450
General Motors Corp. ..................................... 51,900 2,893,425
General Re Corp. ......................................... 5,700 899,175
General Signal Corp. ..................................... 3,400 145,350
Genuine Parts Co. ........................................ 8,300 369,350
Georgia Pacific Corp. .................................... 6,300 453,600
Giant Food, Inc. ......................................... 4,100 141,450
Giddings & Lewis, Inc. ................................... 2,300 29,612
Gillette Co. ............................................. 30,600 2,379,150
Golden West Financial Corp. .............................. 3,900 246,187
</TABLE>
11
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (ALL AMERICA FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
INDEXED PORTION (CONT'D):
Goodrich (B.F.) Co. ...................................... 3,700 $ 149,850
Goodyear Tire & Rubber Co. ............................... 10,700 549,712
GPU Inc. ................................................. 8,300 279,087
Grainger (W.W.), Inc. .................................... 3,600 288,900
Great Atl. & Pac. Tea Co. ................................ 2,600 82,875
Great Lakes Chemical Corp. ............................... 4,300 201,025
Great Western Financial Corp. ............................ 9,500 275,500
Green Tree Financial Corp. ............................... 9,400 363,075
GTE Corp. ................................................ 66,100 3,007,550
Guidant Corp. ............................................ 5,000 285,000
Halliburton Co. .......................................... 8,600 518,150
Harcourt General, Inc. ................................... 4,900 226,012
Harland (John H.) Co. .................................... 2,100 69,300
Harnischfeger Industries, Inc. ........................... 3,400 163,625
Harrah's Entertainment, Inc. ............................. 7,100 141,112
Harris Corp. ............................................. 2,700 185,287
Hasbro, Inc. ............................................. 5,900 229,362
Heinz (H.J.) Co. ......................................... 25,300 904,475
Helmerich & Payne, Inc. .................................. 1,700 88,612
Hercules, Inc. ........................................... 7,000 302,750
Hershey Foods Corp. ...................................... 10,500 459,375
Hewlett-Packard Co. ...................................... 69,800 3,507,450
HFS Inc. ................................................. 8,800 525,800
Hilton Hotels Corp. ...................................... 16,900 441,512
Home Depot, Inc. ......................................... 33,000 1,654,125
Homestake Mining Co. ..................................... 10,100 143,925
Honeywell, Inc. .......................................... 8,700 572,025
Household International, Inc. ............................ 6,700 618,075
Houston Industries, Inc. ................................. 16,100 364,262
Humana, Inc. ............................................. 11,200 214,200
Illinois Tool Works, Inc. ................................ 8,500 678,937
Inco Ltd. ................................................ 11,600 369,750
Ingersoll Rand Co. ....................................... 7,500 333,750
Inland Steel, Inc. ....................................... 3,400 68,000
Intel Corp. .............................................. 56,400 7,384,875
Intergraph Corp. ......................................... 3,300 33,825
International Paper Co. .................................. 20,600 831,725
Interpublic Group of Cos., Inc. .......................... 5,600 266,000
Intl. Business Machines Corp. ............................ 35,500 5,360,500
Intl. Flavors & Fragrances................................ 7,600 342,000
ITT Corp. ................................................ 8,000 347,000
ITT Hartford Group, Inc. ................................. 8,100 546,750
ITT Industries, Inc. ..................................... 8,100 198,450
James River Corp. of VA................................... 5,900 195,437
Jefferson-Pilot Corp. .................................... 4,900 277,462
Johnson & Johnson......................................... 91,500 4,552,125
Johnson Controls, Inc. ................................... 2,800 232,050
Jostens, Inc. ............................................ 2,700 57,037
Kaufman & Broad Home Corp. ............................... 2,700 34,762
Kellogg Co. .............................................. 14,500 951,562
Kerr-McGee Corp. ......................................... 3,300 237,600
KeyCorp................................................... 15,500 782,750
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Kimberly Clark Corp. ..................................... 19,400 $ 1,847,850
King World Productions, Inc. ............................. 2,600 95,875
Kmart Corp. .............................................. 33,200 344,450
Knight-Ridder, Inc. ...................................... 6,400 244,800
Kroger Corp. ............................................. 8,700 404,550
Laidlaw, Inc. Cl B........................................ 21,600 248,400
Lilly (Eli) & Co. ........................................ 37,900 2,766,700
Limited (The), Inc. ...................................... 18,600 341,775
Lincoln National Corp. ................................... 7,200 378,000
Liz Claiborne, Inc. ...................................... 4,900 189,262
Lockheed Martin Corp. .................................... 13,200 1,207,800
Loews Corp. .............................................. 7,900 744,575
Longs Drug Stores, Inc. .................................. 1,300 63,862
Louisiana Land & Exploration.............................. 2,300 123,337
Louisiana-Pacific Corp. .................................. 7,500 158,437
Lowe's Companies, Inc. ................................... 11,900 422,450
LSI Logic Corp. .......................................... 8,800 235,400
Lucent Technologies, Inc. ................................ 43,700 2,021,125
Mallinckrodt, Inc. ....................................... 5,100 225,037
Manor Care, Inc. ......................................... 4,300 116,100
Marriott International, Inc. ............................. 8,800 486,200
Marsh & McLennan Cos., Inc. .............................. 4,900 509,600
Masco Corp. .............................................. 11,000 396,000
Mattel, Inc. ............................................. 18,700 518,925
May Department Stores Co. ................................ 17,300 808,775
Maytag Corp. ............................................. 6,900 136,275
MBIA Inc. ................................................ 3,000 303,750
MBNA Corp. ............................................... 15,300 634,950
McDermott International, Inc. ............................ 3,800 63,175
McDonald's Corp. ......................................... 47,900 2,167,475
McDonnell Douglas Corp. .................................. 14,600 934,400
McGraw-Hill Cos., Inc. ................................... 6,800 313,650
MCI Communications Corp. ................................. 47,000 1,536,312
Mead Corp. ............................................... 3,600 209,250
Medtronic, Inc. .......................................... 16,500 1,122,000
Mellon Bank Corp. ........................................ 8,900 631,900
Mercantile Stores, Inc. .................................. 2,500 123,437
Merck & Co., Inc. ........................................ 82,800 6,561,900
Meredith Corp. ........................................... 1,800 94,950
Merrill Lynch & Co., Inc. ................................ 11,300 920,950
MGIC Investment Corp. .................................... 4,000 304,000
Micron Technology, Inc. .................................. 14,300 416,487
Microsoft Corp. .......................................... 82,100 6,783,512
Millipore Corp. .......................................... 3,000 124,125
Minnesota Mining & Mfg. Co. .............................. 28,700 2,378,512
Mobil Corp. .............................................. 27,100 3,312,975
Monsanto Co. ............................................. 40,400 1,570,550
Moore Corp., Ltd. ........................................ 6,900 140,587
Morgan (J.P.) & Co., Inc. ................................ 12,800 1,249,600
Morgan Stanley Group, Inc. ............................... 10,500 599,812
Morton International, Inc. ............................... 9,800 399,350
Motorola, Inc. ........................................... 40,700 2,497,962
NACCO Industries, Inc. Cl A............................... 600 32,100
Nalco Chemical Co. ....................................... 4,600 166,175
</TABLE>
12
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (ALL AMERICA FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
INDEXED PORTION (CONT'D):
National City Corp. ...................................... 15,200 $ 682,100
National Semiconductor Corp. ............................. 9,500 231,562
National Service Industries............................... 3,300 123,337
NationsBank Corp.......................................... 19,700 1,925,675
Navistar International Corp. ............................. 5,100 46,537
New York Times Co. Cl A .................................. 6,600 250,800
Newell Co. ............................................... 10,900 343,350
Newmont Mining Corp. ..................................... 6,800 304,300
Niagara Mohawk Power Corp. ............................... 9,900 97,762
Nicor, Inc. .............................................. 3,400 121,550
Nike, Inc. Cl B .......................................... 19,800 1,183,050
NorAm Energy Corp. ....................................... 9,400 144,525
Nordstrom, Inc. .......................................... 5,600 198,450
Norfolk Southern Corp. ................................... 8,600 752,500
Northern States Power Co. ................................ 4,700 215,612
Northern Telecom, Ltd. ................................... 17,700 1,095,187
Northrop Grumman Corp. ................................... 4,000 331,000
Norwest Corp. ............................................ 25,400 1,104,900
Novell, Inc. ............................................. 23,600 223,463
Nucor Corp. .............................................. 6,000 306,000
NYNEX Corp. .............................................. 30,200 1,453,375
Occidental Petroleum Corp. ............................... 22,600 528,275
Ohio Edison Co. .......................................... 10,500 238,875
Oneok, Inc. .............................................. 1,900 57,000
Oracle Corp. ............................................. 45,100 1,882,925
Oryx Energy Co. .......................................... 7,200 178,200
Owens Corning ............................................ 3,500 149,187
Paccar, Inc. ............................................. 2,700 183,600
Pacific Enterprises ...................................... 5,800 176,175
Pacific Telesis Group .................................... 29,400 1,080,450
PacifiCorp ............................................... 20,200 414,100
Pall Corp. ............................................... 7,900 201,450
PanEnergy Corp. .......................................... 10,400 468,000
Parker Hannifin Corp. .................................... 5,100 197,625
Peco Energy Co. .......................................... 15,300 386,325
Penney (J.C.) Co., Inc. .................................. 15,800 770,250
Pennzoil Co. ............................................. 3,200 180,800
Peoples Energy Corp. ..................................... 2,400 81,300
Pep Boys-Manny, Moe & Jack ............................... 4,300 132,225
Pepsico, Inc. ............................................ 106,700 3,120,975
Perkin-Elmer Corp. ....................................... 3,000 176,625
Pfizer, Inc. ............................................. 44,300 3,671,362
PG & E Corp. ............................................. 28,300 594,300
Pharmacia & Upjohn, Inc. ................................. 34,900 1,382,912
Phelps Dodge Corp. ....................................... 4,500 303,750
Phillip Morris Cos., Inc. ................................ 55,900 6,295,737
Phillips Petroleum Co. ................................... 18,100 800,925
Pioneer Hi-Bred Intl., Inc. .............................. 5,700 399,000
Pitney Bowes, Inc. ....................................... 10,200 555,900
Placer Dome, Inc. ........................................ 16,400 356,700
PNC Bank Corp. ........................................... 23,400 880,425
Polaroid Corp. ........................................... 3,100 134,850
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Potlatch Corp. ........................................... 2,000 $ 86,000
PP&L Resources, Inc. ..................................... 11,100 255,300
PPG Industries, Inc. ..................................... 12,600 707,175
Praxair, Inc. ............................................ 10,700 493,537
Price/Costco, Inc. ....................................... 13,500 339,187
Proctor & Gamble Co. ..................................... 46,800 5,031,000
Providian Corp. .......................................... 6,400 328,800
Public Svc. Enterprise Group ............................. 16,400 446,900
Pulte Corp. .............................................. 1,600 49,200
Quaker Oats Co. .......................................... 9,300 354,562
Ralston Purina Co. ....................................... 7,300 535,637
Raychem Corp. ............................................ 3,100 248,387
Raytheon Co. ............................................. 16,200 779,625
Reebok International Ltd. ................................ 3,800 159,600
Republic New York Corp. .................................. 3,800 310,175
Reynold's Metals Co. ..................................... 4,400 248,050
Rite-Aid Corp. ........................................... 8,400 333,900
Rockwell Intl Corp. ...................................... 15,000 913,125
Rohm & Haas Co. .......................................... 4,400 359,150
Rowan Cos., Inc. ......................................... 5,900 133,487
Royal Dutch Petroleum Co. ................................ 36,800 6,283,600
Rubbermaid, Inc. ......................................... 10,300 234,325
Russell Corp. ............................................ 2,600 77,350
Ryder System, Inc. ....................................... 5,600 157,500
Safeco Corp. ............................................. 8,700 343,106
Safety Kleen Corp. ....................................... 4,000 65,500
Salomon, Inc. ............................................ 7,500 353,437
Santa Fe Energy Resources, Inc. .......................... 6,200 86,025
Sante Fe Pacific Gold Corp. .............................. 9,000 138,375
Sara Lee Corp. ........................................... 33,200 1,236,700
SBC Communications, Inc. ................................. 41,500 2,147,625
Schering-Plough Corp. .................................... 25,400 1,644,650
Schlumberger, Ltd. ....................................... 16,900 1,687,887
Scientific-Atlanta, Inc. ................................. 5,300 79,500
Seagate Technology, Inc. ................................. 17,300 683,350
Seagram, Ltd. ............................................ 25,600 992,000
Sears Roebuck & Co. ...................................... 26,900 1,240,762
Service Corp. International .............................. 16,200 453,600
Shared Medical Systems Corp. ............................. 1,600 78,800
Sherwin-Williams Co. ..................................... 5,900 330,400
Sigma Aldrich Corp. ...................................... 3,400 212,287
Silicon Graphics, Inc. ................................... 12,000 306,000
Snap-On, Inc. ............................................ 4,200 149,625
Sonat, Inc. .............................................. 5,900 303,850
Southern Co. ............................................. 46,300 1,047,537
Southwest Airlines Co. ................................... 10,000 221,250
Springs Industries, Inc. Cl A ............................ 1,400 60,200
Sprint Corp. ............................................. 29,600 1,180,300
St. Jude Medical, Inc. ................................... 5,600 238,700
St. Paul Companies (The) ................................. 5,700 334,162
Stanley Works ............................................ 6,100 164,700
Stone Container Corp. .................................... 6,800 101,150
Stride Rite Corp. ........................................ 3,400 34,000
Sun Co., Inc. ............................................ 5,000 121,875
</TABLE>
13
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (ALL AMERICA FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------ ------------
<S> <C> <C>
INDEXED PORTION (CONT'D):
Sun Microsystems, Inc. .................................... 25,200 $ 647,325
Suntrust Banks, Inc. ...................................... 15,300 753,525
Supervalu, Inc. ........................................... 4,600 130,525
Sysco Corp. ............................................... 12,300 401,287
Tandem Computers, Inc. .................................... 8,100 111,375
Tandy Corp. ............................................... 4,000 176,000
Tektronix, Inc. ........................................... 2,300 117,875
Tele-Communications, Inc. Cl A ............................ 45,600 595,650
Tellabs, Inc. ............................................. 12,300 462,787
Temple-Inland, Inc. ....................................... 3,800 205,675
Tenet Healthcare Corp. .................................... 14,900 325,937
Tenneco, Inc. ............................................. 11,700 527,962
Texaco, Inc. .............................................. 18,200 1,785,875
Texas Instruments, Inc. ................................... 13,000 828,750
Texas Utilities Co. ....................................... 15,400 627,550
Textron, Inc. ............................................. 5,700 537,225
Thermo Electron Corp. ..................................... 10,100 416,625
Thomas & Betts Corp. ...................................... 3,600 159,750
Time Warner, Inc. ......................................... 39,100 1,466,250
Times Mirror Co. Cl A ..................................... 6,800 338,300
Timken Co. ................................................ 2,100 96,337
TJX Cos., Inc. ............................................ 5,300 251,087
Torchmark Corp. ........................................... 4,800 242,400
Toys R Us, Inc. ........................................... 18,800 564,000
Transamerica Corp. ........................................ 4,600 363,400
Travelers Group, Inc. ..................................... 44,000 1,996,499
Tribune Co. ............................................... 4,200 331,275
Trinova Corp. ............................................. 1,900 69,112
TRW, Inc. ................................................. 8,700 430,650
Tupperware Corp. .......................................... 4,300 230,587
Tyco Labs, Inc. ........................................... 10,800 571,050
U.S. Bancorp .............................................. 10,400 467,350
U.S. Life Corp. ........................................... 2,400 79,800
U.S. Surgical Corp. ....................................... 4,300 169,312
U.S. West Media Group ..................................... 42,900 793,650
U.S. West Communications Group ............................ 32,800 1,057,800
Unicom Corp. .............................................. 14,800 401,450
Unilever N.V. ............................................. 11,000 1,927,750
Union Camp Corp. .......................................... 4,800 229,200
Union Carbide Corp. ....................................... 8,700 355,612
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Union Electric Co. ........................................ 7,000 $ 269,500
Union Pacific Corp. ....................................... 16,800 1,010,100
Union Pacific Resources Grp. .............................. 17,200 503,099
Unisys Corp. .............................................. 12,000 81,000
United Healthcare Corp. ................................... 12,600 567,000
United Technologies Corp. ................................. 16,500 1,089,000
Unocal Corp. .............................................. 17,200 698,750
UNUM Corp. ................................................ 5,000 361,250
USAir Group, Inc. ......................................... 4,400 102,850
USF&G Corp. ............................................... 7,900 164,912
UST, Inc. ................................................. 12,800 414,400
USX-Marathon Group ........................................ 19,700 470,337
USX-U.S. Steel Group, Inc. ............................... 5,800 181,975
V F Corp. ................................................. 4,400 297,000
Viacom, Inc. .............................................. 24,300 847,476
W.R. Grace & Co. .......................................... 6,100 315,675
Wachovia Corp. ............................................ 11,300 638,450
Wal-Mart Stores, Inc. ..................................... 157,500 3,602,812
Walgreen Co. .............................................. 16,900 676,000
Warner-Lambert Co. ........................................ 18,600 1,395,000
Wells Fargo & Co. ......................................... 6,400 1,726,453
Wendy's International, Inc. ............................... 8,900 182,450
Western Atlas, Inc. ....................................... 3,700 262,237
Westinghouse Electric Corp. ............................... 29,000 576,375
Westvaco Corp. ............................................ 7,000 201,250
Weyerhaeuser Co. .......................................... 13,600 644,300
Whirlpool Corp. ........................................... 5,100 237,787
Whitman Corp. ............................................. 7,100 162,412
Willamette Industries, Inc. ............................... 3,800 264,575
Williams Cos., Inc. ....................................... 10,800 405,000
Winn-Dixie Stores, Inc. ................................... 10,400 328,900
WMX Technologies, Inc. .................................... 33,300 1,086,412
Woolworth Corp. ........................................... 9,200 201,250
WorldCom, Inc. ............................................ 28,100 732,356
Worthington Industries, Inc. .............................. 6,200 112,375
Wrigley (Wm.) Jr. Co. ..................................... 8,000 450,000
Xerox Corp. ............................................... 22,300 1,173,602
------------
TOTAL INDEXED PORTION-- COMMON STOCKS
(Cost: $253,067,266) 61.0%........................................ 387,206,933
------------
</TABLE>
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT
---- -------- ----------
<S> <C> <C> <C> <C>
SHORT-TERM DEBT SECURITIES:
U.S. Government(*)
U.S. Treasury Bill..................... 5.00% 05/15/97 $ 310,000 304,191
------------
Commercial Paper (0.2%)
Merrill Lynch & Co., Inc............... 6.50 01/02/97 1,527,000 1,526,620
------------
TOTAL INDEXED--SHORT-TERM DEBT SECURITIES
(Cost: $1,830,915) 0.3%......................................... 1,830,811
------------
TOTAL INDEXED PORTION
(Cost: $254,898,181) 61.3%...................................... 389,037,744
------------
</TABLE>
- -------
* Less than .1%
14
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (ALL AMERICA FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
ACTIVE PORTION:
COMMON STOCKS
Basic Materials (0.9%)
Delta & Pine Land Co. ................................... 140,000 $ 4,480,000
Millenium Chemical Inc*.................................. 55,900 992,225
Titanium Metals Corporation*............................. 11,900 391,212
------------
5,863,437
------------
Consumer, Cyclical (9.9%)
American Greetings Corp. Cl A............................ 56,300 1,597,512
Atlas Air, Inc.*......................................... 7,800 372,450
Block (H & R), Inc....................................... 45,000 1,305,000
Blyth Industries, Inc.*.................................. 11,600 529,250
Borg-Warner Automotive, Inc.............................. 80,000 3,080,000
Brunswick Corp........................................... 62,000 1,488,000
Callaway Golf Co......................................... 155,000 4,456,250
Cinar Films, Inc. Cl B*.................................. 40,000 1,040,000
Compucom Systems, Inc.*.................................. 18,300 196,725
Cross-Continent Auto Retailers*.......................... 18,300 382,012
Designer Holdings Ltd*................................... 20,000 322,500
Eastman Kodak Co......................................... 18,555 1,489,038
Fine Host Corp*.......................................... 19,000 365,750
Finlay Enterprises, Inc.*................................ 86,000 1,333,000
First Alert, Inc.*....................................... 100,000 337,500
Footstar, Inc.*.......................................... 25,000 621,875
Gannett, Inc............................................. 17,600 1,317,800
Golden Bear Golf, Inc.*.................................. 69,500 781,875
Harold's Stores, Inc.*................................... 37,900 544,812
Jones Apparel Group, Inc.*............................... 21,000 784,875
Landry's Seafood Restaurant*............................. 36,400 778,050
Loehmann's Holdings, Inc.*............................... 18,000 414,000
Loewen Group, Inc........................................ 20,550 804,018
Lone Star Steakhouse*.................................... 40,700 1,088,725
Masco Corp............................................... 33,500 1,206,000
May Department Stores Co. ............................... 30,100 1,407,175
Midwest Express Holdings, Inc.*.......................... 55,000 1,980,000
Nautica Enterprises, Inc.*............................... 14,000 353,500
Norton McNaughton, Inc.*................................. 87,000 739,500
OfficeMax, Inc.*......................................... 35,000 371,875
Outback Steakhouse, Inc.*................................ 5,200 139,100
PetSmart Inc.*........................................... 10,200 223,125
Prime Hospitality Corp*.................................. 25,000 403,125
Quiksilver Inc*.......................................... 11,400 243,675
Ryder System, Inc........................................ 39,500 1,110,937
St. John Knits, Inc...................................... 168,800 7,342,800
Stage Stores Inc*........................................ 14,400 262,800
Tandy Corp. ............................................. 32,000 1,408,000
The Men's Wearhouse, Inc.*............................... 15,000 367,500
The Sports Authority Inc*................................ 43,300 941,775
Tiffany & Co............................................. 158,500 5,805,062
Toll Brothers Inc*....................................... 102,000 1,989,000
Tommy Hilfiger Corp.*.................................... 6,600 316,800
Tower Automotive, Inc.*.................................. 123,000 3,843,750
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Unitog Co. .............................................. 83,000 $ 2,261,750
West Marine, Inc.*....................................... 30,000 847,500
Whirlpool Corp........................................... 28,600 1,333,475
Xerox Corp. ............................................. 41,900 2,204,987
------------
62,534,228
------------
Consumer, Non-Cyclical (3.9%)
Access Health, Inc.*..................................... 17,000 760,750
American Stores Co. ..................................... 47,800 1,953,825
Biochem Pharma, Inc.*.................................... 11,600 582,900
Biopsys Medical, Inc.*................................... 21,300 463,275
CompDent Corp.*.......................................... 22,600 796,650
Conagra, Inc. ........................................... 32,000 1,592,000
Conmed Corp.*............................................ 61,000 1,250,500
ESC Medical Systems Ltd.*................................ 21,200 540,600
Heartport, Inc.*......................................... 9,000 205,875
Hologic, Inc*............................................ 40,800 1,009,800
Intercardia, Inc.*....................................... 3,500 75,250
Kimberly-Clark Corp. .................................... 15,720 1,497,330
Lincare Holdings, Inc.*.................................. 19,000 779,000
Mentor Corp. ............................................ 19,600 578,200
Novartis*................................................ 22,386 1,281,598
Pharmacia & Upjohn, Inc.*................................ 38,100 1,509,712
Phillip Morris Cos., Inc. ............................... 20,700 2,331,337
PhyCor, Inc.*............................................ 22,500 638,437
Physician Sales & Service, Inc.*......................... 23,000 330,625
Rural/Metro Corp.*....................................... 15,500 558,000
Serologicals Corp.*...................................... 10,000 353,750
Sola International, Inc.*................................ 111,000 4,218,000
Steris Corp.*............................................ 17,500 761,250
Target Therapeutics, Inc.*............................... 11,000 462,000
------------
24,530,664
------------
Energy (1.6%)
Kerr-McGee Corp. ........................................ 19,200 1,382,400
Mobil Corp. ............................................. 11,000 1,344,750
Oceaneering Int'l, Inc.*................................. 130,000 2,063,750
Repsol S.A. ADR.......................................... 56,775 2,164,546
Royal Dutch Petroleum Co. ............................... 8,100 1,383,075
Union Pacific Resources Grp. ............................ 20,496 599,508
USX-Marathon Group....................................... 58,400 1,394,300
------------
10,332,329
------------
Financial (3.5%)
Ahmanson (H.F.) & Co. ................................... 34,951 1,135,907
American Int'l. Group, Inc.*............................. 29,300 3,171,725
Aon Corp. ............................................... 21,000 1,304,625
Citicorp................................................. 49,000 5,047,000
Keystone Financial, Inc.*................................ 74,750 1,868,750
Loews Corp. ............................................. 15,900 1,498,575
National Golf Properties, Inc. .......................... 40,000 1,265,000
NationsBank Corp. ....................................... 18,000 1,759,500
Providian Corp. ......................................... 29,100 1,495,012
</TABLE>
15
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (ALL AMERICA FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
ACTIVE PORTION (CONT'D):
Summit Bancorp........................................... 58,900 $ 2,576,875
The Money Store, Inc. ................................... 34,500 953,062
------------
22,076,031
------------
Industrial (5.2%)
Acxiom Corp.*............................................ 25,000 600,000
AGCO Corp. .............................................. 75,000 2,146,875
Applied Materials, Inc.*................................. 47,300 1,699,843
Burlington Northern Santa Fe............................. 17,711 1,529,787
Checkfree Corp*.......................................... 70,000 1,198,750
Coach USA, Inc.*......................................... 35,000 1,015,000
Crown Cork & Seal Co., Inc. ............................. 26,400 1,435,500
Cymer, Inc.*............................................. 28,000 1,347,500
Employee Solutions, Inc.*................................ 30,000 615,000
FactSet Research Systems, Inc.*.......................... 22,600 474,600
First Data Corp. ........................................ 91,982 3,357,343
Forrester Research Inc.*................................. 3,300 84,975
Foster Wheeler Corp. .................................... 38,500 1,429,312
Greenfield Industries Inc. .............................. 45,000 1,378,125
Hardinge, Inc. .......................................... 86,000 2,289,750
HBO & Co. ............................................... 10,800 641,250
Metromail Corp.*......................................... 14,000 255,500
National Data Corp. ..................................... 12,000 522,000
Parker Hannifin Corp. ................................... 35,000 1,356,250
PMT Services, Inc.*...................................... 13,700 239,750
Quick Response Services, Inc.*........................... 19,200 547,200
Quintiles Transnational Corp.*........................... 8,700 576,375
Railtex, Inc.*........................................... 50,500 1,275,125
Sealed Air Corp.*........................................ 22,000 915,750
Union Pacific Corp. ..................................... 24,200 1,455,025
Uniphase Corporation*.................................... 10,000 525,000
United Waste Systems, Inc.*.............................. 28,000 962,500
USA Waste Services, Inc.*................................ 50,000 1,593,750
Whittman-Hart, Inc.*..................................... 32,000 820,000
Wyman-Gordon Co.*........................................ 24,000 534,000
------------
32,821,835
------------
Technology (12.6%)
3Com Corp.*.............................................. 139,700 10,250,487
Adaptec, Inc.*........................................... 21,000 840,000
Ascend Communications, Inc.*............................. 18,700 1,161,737
Atmel Corp.*............................................. 100,600 3,332,375
Auspex Systems, Inc.*.................................... 17,800 206,925
Bay Networks, Inc.*...................................... 105,750 2,207,531
CBT Group PLC*........................................... 10,000 542,500
Cellpro, Inc.*........................................... 30,000 375,000
Checkpoint Systems*...................................... 23,400 579,150
Cisco Systems, Inc.*..................................... 142,500 9,066,562
Citrix Systems, Inc.*.................................... 16,800 656,250
ClinTrials, Inc.*........................................ 10,500 238,875
Compaq Computer Corp.*................................... 62,500 4,640,625
Compuware Corp.*......................................... 20,000 1,002,500
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Curative Health Services Inc.*........................... 7,800 $ 215,962
Digital Microwave Corp.*................................. 34,400 958,900
DSP Communications, Inc.*................................ 36,800 713,000
Electronics For Imaging, Inc.*........................... 13,000 1,069,250
Glenayre Technologies, Inc.*............................. 20,362 439,055
Greenwich Air Services, Inc. B*.......................... 26,000 578,500
INCYTE Pharmaceuticals, Inc.*............................ 14,000 721,000
Infinity Financial Tech., Inc.*.......................... 5,200 89,700
Information Mgmt Resources*.............................. 20,000 422,500
Inso Corp.*.............................................. 10,200 405,450
Integrated Systems, Inc.*................................ 14,200 369,200
Intel Corp.*............................................. 62,000 8,118,125
Intl. Business Machines Corp. ........................... 20,276 3,061,676
Keane, Inc.*............................................. 22,400 711,200
Learning Company Inc*.................................... 30,500 438,437
Linear Technology Corp. ................................. 65,500 2,873,812
Maxim Integrated Products, Inc.*......................... 68,500 2,962,625
Medic Computer Systems, Inc.*............................ 28,500 1,148,906
Minnesota Mining & Mfg. Co. ............................. 20,490 1,698,108
Motorola, Inc. .......................................... 34,000 2,086,750
Network Appliance, Inc.*................................. 6,500 330,687
Parametric Technology Co.*............................... 18,000 924,750
PictureTel Corp.*........................................ 25,000 650,000
Raster Graphics, Inc.*................................... 34,500 409,687
Raytheon Co.*............................................ 26,576 1,278,970
S3, Inc.*................................................ 38,000 617,500
Saville Systems PLC-Spon ADR*............................ 16,200 658,125
Structural Dynamics Research*............................ 43,300 866,000
Sun Microsystems, Inc.*.................................. 200,000 5,137,500
Systemsoft Corp.*........................................ 22,600 336,175
Tellabs, Inc.*........................................... 28,000 1,053,500
U.S. Robotics Corp.*..................................... 23,300 1,677,600
Videoserver Inc.*........................................ 28,200 1,198,500
Waters Corp.*............................................ 17,300 525,487
Xilinx, Inc.*............................................ 17,000 625,812
------------
80,472,966
------------
Utilities (1.0%)
British Telecom PLC--Spon ADR*........................... 10,000 686,250
Edison International..................................... 38,000 755,250
LCI International, Inc.*................................. 22,100 475,150
MCI Communications Corp. ................................ 48,300 1,578,806
PG & E Corp. ............................................ 30,600 642,600
SBC Communications, Inc. ................................ 27,000 1,397,250
Tele Danmark A/S--ADR.................................... 22,500 613,125
------------
6,148,431
------------
TOTAL ACTIVE PORTION--
COMMON STOCKS
(Cost: $173,147,656) 38.6%....................................... 244,779,921
------------
</TABLE>
- -------
* Non-income producing security.
16
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (ALL AMERICA FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
---- -------- -------- ------------
<S> <C> <C> <C> <C>
ACTIVE PORTION (CONT'D):
SHORT-TERM DEBT SECURITIES:
Commercial Paper (0.1%)
Ford Motor Credit Corp. ................. 5.88% 01/02/97 $300,000 $ 299,951
Merrill Lynch & Co., Inc................. 6.50 01/02/97 320,000 319,942
------------
619,893
------------
TOTAL ACTIVE PORTION SHORT-TERM DEBT SECURITIES
(Cost: $619,893) 0.1%........................................... 619,893
------------
TOTAL ACTIVE PORTION
(Cost: $173,767,549) 38.7%...................................... 245,399,814
------------
TOTAL INVESTMENTS
(Cost: $428,665,730) 100.0%..................................... $634,437,558
============
</TABLE>
- -------
FUTURES CONTRACTS OUTSTANDING AS OF DECEMBER 31, 1996:
<TABLE>
<CAPTION>
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN
---------- --------------- ----------
<S> <C> <C> <C>
PURCHASED
2 S&P 500 Stock Index Futures Contracts... March 1997 $744,500 $6,350
======== ======
</TABLE>
The face value of futures purchased and outstanding as percentage of total
investment in securities--0.1%
17
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (EQUITY INDEX FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
INDEX PORTION:
COMMON STOCKS
3Com Corp. ............................................... 2,900 $ 212,787
Abbott Laboratories....................................... 12,900 654,675
Advanced Micro Devices, Inc. ............................. 2,300 59,225
Aetna, Inc. .............................................. 2,500 200,000
Ahmanson (H.F.) & Co. .................................... 1,700 55,250
Air Products & Chemicals Corp. ........................... 1,800 124,425
Airtouch Communications, Inc. ............................ 8,300 209,575
Alberto Culver Co. Cl B................................... 500 24,000
Albertson's, Inc. ........................................ 4,200 149,625
Alcan Aluminum Ltd. ...................................... 3,700 124,412
Alco Standard Corp. ...................................... 2,200 113,575
Alexander & Alexander Svcs. .............................. 700 12,162
Allegheny Teledyne Inc. .................................. 2,900 66,700
Allergan, Inc. ........................................... 1,100 39,187
AlliedSignal, Inc. ....................................... 4,700 314,900
Allstate Corp. ........................................... 7,400 428,275
Alltel Corp. ............................................. 3,100 97,262
Aluminum Co. of America................................... 2,900 184,875
Alza Corp. ............................................... 1,400 36,225
Amdahl Corp. ............................................. 2,000 24,250
Amerada Hess Corp. ....................................... 1,500 86,812
American Brands, Inc. .................................... 2,800 138,950
American Electric Power Co. .............................. 3,100 127,487
American Express Co. ..................................... 7,800 440,700
American General Corp. ................................... 3,400 138,975
American Greetings Corp. Cl A............................. 1,200 34,050
American Home Products Corp. ............................. 10,600 621,425
American Int'l. Group, Inc. .............................. 7,800 844,350
American Stores Co. ...................................... 2,400 98,100
Ameritech Corp. .......................................... 9,100 551,687
Amgen, Inc. .............................................. 4,400 239,250
Amoco Corp. .............................................. 8,200 660,100
Amp, Inc. ................................................ 3,600 138,150
AMR Corp. ................................................ 1,500 132,187
Andrew Corp. ............................................. 1,000 53,062
Anheuser Busch Cos., Inc. ................................ 8,300 332,000
Aon Corp. ................................................ 1,800 111,825
Apple Computer, Inc. ..................................... 2,100 43,837
Applied Materials, Inc. .................................. 3,000 107,812
Archer Daniels Midland Co. ............................... 9,000 198,000
Armco, Inc. .............................................. 1,800 7,425
Armstrong World Inds., Inc. .............................. 700 48,650
Asarco, Inc. ............................................. 700 17,412
Ashland, Inc. ............................................ 1,100 48,262
AT&T Corp. ............................................... 26,800 1,165,800
Atlantic Richfield Co. ................................... 2,700 357,750
Autodesk, Inc. ........................................... 800 22,400
Automatic Data Processing, Inc. .......................... 4,800 205,800
AutoZone, Inc. ........................................... 2,700 74,250
Avery Dennison Corp. ..................................... 1,800 63,675
Avon Products, Inc. ...................................... 2,200 125,675
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Baker Hughes, Inc. ....................................... 2,400 $ 82,800
Ball Corp. ............................................... 500 13,000
Baltimore Gas & Electric Co. ............................. 2,400 64,200
Banc One Corp. ........................................... 7,100 305,300
Bank of Boston Corp. ..................................... 2,500 160,625
Bank of New York, Inc. ................................... 6,500 219,375
BankAmerica Corp. ........................................ 5,900 588,525
Bankers Trust New York Corp. ............................. 1,400 120,750
Bard (C.R.), Inc. ........................................ 900 25,200
Barnett Banks, Inc. ...................................... 3,200 131,600
Barrick Gold Corp. ....................................... 5,900 169,625
Battle Mountain Gold Co. ................................. 3,700 25,437
Bausch & Lomb, Inc. ...................................... 900 31,500
Baxter International, Inc. ............................... 4,500 184,500
Bay Networks, Inc. ....................................... 3,200 66,800
Becton Dickinson & Co. ................................... 2,100 91,087
Bell Atlantic Corp. ...................................... 7,200 466,200
BellSouth Corp. .......................................... 16,400 662,150
Bemis Co. ................................................ 900 33,187
Beneficial Corp. ......................................... 900 57,037
Bethlehem Steel Corp. .................................... 1,800 16,200
Beverly Enterprises, Inc. ................................ 1,600 20,400
Biomet, Inc. ............................................. 1,900 28,737
Black & Decker Corp. ..................................... 1,500 45,187
Block (H & R), Inc. ...................................... 1,700 49,300
Boatmen's Bancshares, Inc. ............................... 2,600 167,700
Boeing Co. ............................................... 5,900 627,612
Boise Cascade Corp. ...................................... 800 25,400
Boston Scientific Corp. .................................. 2,900 174,000
Briggs & Stratton Corp. .................................. 500 22,000
Bristol-Myers Squibb Co. ................................. 8,300 902,625
Brown-Forman Corp. Cl B................................... 1,100 50,325
Browning Ferris Inds., Inc. .............................. 3,500 91,875
Brunswick Corp. .......................................... 1,600 38,400
Burlington Northern Santa Fe.............................. 2,500 215,937
Burlington Resources, Inc. ............................... 2,100 105,787
Cabletron Systems, Inc. .................................. 2,600 86,450
Caliber System, Inc. ..................................... 600 11,550
Campbell Soup Co. ........................................ 3,900 312,975
Carolina Power & Light Co. ............................... 2,500 91,250
Case Corp. ............................................... 1,200 65,400
Caterpillar, Inc. ........................................ 3,200 240,800
Centex Corp. ............................................. 500 18,812
Central & South West Corp. ............................... 3,500 89,687
Ceridian Corp. ........................................... 1,100 44,550
Champion International Corp. ............................. 1,600 69,200
Charming Shoppes, Inc. ................................... 1,700 8,606
Chase Manhattan Corp. .................................... 7,300 651,525
Chevron Corp. ............................................ 10,800 702,000
Chrysler Corp. ........................................... 12,100 399,300
Chubb Corp. .............................................. 2,900 155,875
CIGNA Corp. .............................................. 1,200 163,950
Cincinnati Milacron, Inc. ................................ 700 15,312
Cinergy Corp. ............................................ 2,600 86,781
</TABLE>
18
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (EQUITY INDEX FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
INDEX PORTION (CONT'D):
Circuit City Stores, Inc. ................................ 1,600 $ 48,200
Cisco Systems, Inc. ...................................... 10,700 680,787
Citicorp.................................................. 7,800 803,400
Clorox Co. .............................................. 900 90,337
Coastal Corp. ............................................ 1,700 83,087
Coca-Cola Co. ............................................ 41,200 2,168,150
Cognizant Corp. .......................................... 2,800 92,400
Colgate-Palmolive Co. .................................... 2,400 221,400
Columbia Gas System, Inc. ................................ 900 57,262
Columbia HCA Healthcare Corp. ............................ 11,100 452,325
Comcast Corp. Cl A........................................ 5,400 96,187
Comerica, Inc. ........................................... 1,800 94,275
Compaq Computer Corp. ................................... 4,500 334,125
Computer Associates Intl., Inc. ......................... 6,000 298,500
Computer Sciences Corp. .................................. 1,300 106,762
Conagra, Inc. ............................................ 4,000 199,000
Conrail, Inc. ............................................ 1,300 129,512
Consolidated Edison Co NY, Inc. .......................... 3,900 114,075
Consolidated Natural Gas Co. ............................ 1,600 88,400
Cooper Industries......................................... 1,800 75,825
Cooper Tire & Rubber Co. ................................. 1,400 27,650
Coors (Adolph) Co. Cl B................................... 600 11,400
CoreStates Financial Corp. ............................... 3,700 191,937
Corning, Inc. ............................................ 3,800 175,750
CPC International, Inc. .................................. 2,400 186,000
Crane Co. ................................................ 425 12,325
Crown Cork & Seal Co., Inc. .............................. 2,100 114,187
CSX Corp. ............................................... 3,600 152,100
CUC International, Inc. .................................. 6,500 154,375
Cummins Engine, Inc. ..................................... 700 32,200
CVS Corp. ................................................ 1,700 70,337
Cyprus Amax Minerals Co. ................................. 1,500 35,062
Dana Corp. ............................................... 1,700 55,462
Darden Restaurants, Inc. ................................. 2,600 22,750
Data General Corp. ....................................... 600 8,700
Dayton Hudson Corp. ...................................... 3,600 141,300
Dean Witter Discover & Co. .............................. 2,700 178,875
Deere & Co. .............................................. 4,300 174,687
Dell Computer Corp. ...................................... 3,000 159,375
Delta Air Lines, Inc. .................................... 1,200 85,050
Deluxe Corp. ............................................ 1,400 45,850
Digital Equipment Corp. .................................. 2,600 94,575
Dillard Dept. Stores, Inc. .............................. 1,900 58,662
Disney (Walt) Co. ........................................ 11,200 779,799
Dominion Resources, Inc. ................................. 3,000 115,500
Donnelley (R.R.) & Sons Co. .............................. 2,500 78,437
Dover Corp. .............................................. 1,900 95,475
Dow Chemical Co. ........................................ 4,000 313,500
Dow Jones & Co., Inc. .................................... 1,600 54,200
Dresser Industries, Inc. ................................. 2,900 89,900
DSC Communications Corp. ................................ 1,900 33,962
DTE Energy Co. .......................................... 2,400 77,700
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Du Pont (E.I.) De Nemours................................. 9,300 $ 877,687
Duke Power Co. ........................................... 3,300 152,625
Dun & Bradstreet Corp. ................................... 2,800 66,500
Eastern Enterprises....................................... 300 10,612
Eastman Chemical Co. ..................................... 1,300 71,825
Eastman Kodak Co. ........................................ 5,500 441,375
Eaton Corp. .............................................. 1,300 90,675
Echlin, Inc. ............................................. 1,000 31,625
Echo Bay Mines, Ltd. ..................................... 2,300 15,237
Ecolab, Inc. ............................................. 1,100 41,387
Edison International...................................... 7,200 143,100
EG&G, Inc. ............................................... 800 16,100
EMC Corp. ................................................ 3,900 129,187
Emerson Electric Co. ..................................... 3,700 357,975
Engelhard Corp. .......................................... 2,400 45,900
Enron Corp. .............................................. 4,200 181,125
Enserch Corp. ............................................ 1,200 27,600
Entergy Corp. ............................................ 3,800 105,450
Exxon Corp. .............................................. 20,600 2,018,800
Fannie Mae................................................ 18,100 674,225
Federal Express Corp. .................................... 1,900 84,550
Federal Home Loan Mtge Corp. ............................. 3,000 330,375
Federated Department Stores............................... 3,400 116,025
Fifth Third Bancorp....................................... 1,800 113,062
First Bank System, Inc. .................................. 2,200 150,150
First Chicago NBD Corp. .................................. 5,300 284,875
First Data Corp. ......................................... 7,400 270,100
First Union Corp. ........................................ 4,700 347,800
Fleet Financial Group, Inc. .............................. 4,300 214,462
Fleetwood Enterprises, Inc. .............................. 600 16,500
Fleming Cos., Inc. ....................................... 600 10,350
Fluor Corp. .............................................. 1,400 87,850
FMC Corp. ................................................ 600 42,075
Ford Motor Co. ........................................... 19,600 624,750
Foster Wheeler Corp. ..................................... 700 25,987
FPL Group, Inc. .......................................... 3,000 138,000
Freeport-McMoran Copper Cl B ............................. 3,200 95,600
Frontier Corp. ........................................... 3,000 67,875
Fruit of the Loom, Inc. ................................. 1,300 49,237
Gannett, Inc. ............................................ 2,300 172,212
Gap, Inc. ................................................ 4,700 141,587
General Dynamics Corp. ................................... 1,000 70,500
General Electric Co. ..................................... 27,300 2,699,287
General Instrument Corp. ................................. 2,300 49,737
General Mills, Inc. ...................................... 2,600 164,775
General Motors Corp. .................................... 12,500 696,875
General Re Corp. ......................................... 1,400 220,850
General Signal Corp. ..................................... 800 34,200
Genuine Parts Co. ....................................... 2,000 89,000
Georgia Pacific Corp. .................................... 1,500 108,000
Giant Food, Inc. ......................................... 1,000 34,500
Giddings & Lewis, Inc. ................................... 500 6,437
Gillette Co. ............................................. 7,400 575,350
Golden West Financial Corp. .............................. 900 56,812
</TABLE>
19
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (EQUITY INDEX FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
INDEX PORTION (CONT'D):
Goodrich (B.F.) Co. ...................................... 900 $ 36,450
Goodyear Tire & Rubber Co. ............................... 2,600 133,575
GPU Inc. ................................................. 2,000 67,250
Grainger (W.W.), Inc. .................................... 900 72,225
Great Atl. & Pac. Tea Co. ................................ 600 19,125
Great Lakes Chemical Corp. ............................... 1,000 46,750
Great Western Financial Corp. ............................ 2,300 66,700
Green Tree Financial Corp. ............................... 2,300 88,837
GTE Corp. ................................................ 15,900 723,450
Guidant Corp. ............................................ 1,400 79,800
Halliburton Co. .......................................... 2,100 126,525
Harcourt General, Inc. ................................... 1,200 55,350
Harland (John H.) Co. .................................... 500 16,500
Harnischfeger Industries, Inc. ........................... 800 38,500
Harrah's Entertainment, Inc. ............................. 1,700 33,787
Harris Corp. ............................................. 600 41,175
Hasbro, Inc. ............................................. 1,400 54,425
Heinz (H.J.) Co. ......................................... 6,100 218,075
Helmerich & Payne, Inc. .................................. 400 20,850
Hercules, Inc. ........................................... 1,700 73,525
Hershey Foods Corp. ...................................... 2,500 109,375
Hewlett-Packard Co. ...................................... 16,800 844,200
HFS Inc. ................................................. 2,100 125,475
Hilton Hotels Corp. ...................................... 4,000 104,500
Home Depot, Inc. ......................................... 8,000 401,000
Homestake Mining Co. ..................................... 2,400 34,200
Honeywell, Inc. .......................................... 2,100 138,075
Household International, Inc. ............................ 1,600 147,600
Houston Industries, Inc. ................................. 3,900 88,237
Humana, Inc. ............................................. 2,700 51,637
Illinois Tool Works, Inc. ................................ 2,000 159,750
Inco Ltd. ................................................ 2,800 89,250
Ingersoll Rand Co. ....................................... 1,800 80,100
Inland Steel, Inc. ....................................... 800 16,000
Intel Corp. .............................................. 13,600 1,780,750
Intergraph Corp. ......................................... 800 8,200
International Paper Co. .................................. 5,000 201,875
Interpublic Group of Cos., Inc. .......................... 1,300 61,750
Intl. Business Machines Corp. ............................ 8,600 1,298,600
Intl. Flavors & Fragrances ............................... 1,800 81,000
ITT Corp. ................................................ 1,900 82,412
ITT Hartford Group, Inc. ................................. 1,900 128,250
ITT Industries, Inc. ..................................... 2,000 49,000
James River Corp. of VA .................................. 1,400 46,375
Jefferson-Pilot Corp. .................................... 1,200 67,950
Johnson & Johnson ........................................ 22,000 1,094,500
Johnson Controls, Inc. ................................... 700 58,012
Jostens, Inc. ............................................ 600 12,675
Kaufman & Broad Home Corp. ............................... 600 7,725
Kellogg Co. .............................................. 3,500 229,687
Kerr-McGee Corp. ......................................... 800 57,600
KeyCorp .................................................. 3,700 186,850
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Kimberly Clark Corp. ..................................... 4,700 $ 447,675
King World Productions, Inc. ............................. 600 22,125
Kmart Corp. .............................................. 8,000 83,000
Knight-Ridder, Inc. ...................................... 1,600 61,200
Kroger Corp. ............................................. 2,100 97,650
Laidlaw, Inc. Cl B ....................................... 5,200 59,800
Lilly (Eli) & Co. ........................................ 9,100 664,300
Limited (The), Inc. ...................................... 4,500 82,687
Lincoln National Corp. ................................... 1,700 89,250
Liz Claiborne, Inc. ...................................... 1,200 46,350
Lockheed Martin Corp. .................................... 3,200 292,800
Loews Corp. .............................................. 1,900 179,075
Longs Drug Stores, Inc. .................................. 300 14,737
Louisiana Land & Exploration.............................. 600 32,175
Louisiana-Pacific Corp. .................................. 1,800 38,025
Lowe's Companies, Inc. ................................... 2,900 102,950
LSI Logic Corp. .......................................... 2,100 56,175
Lucent Technologies, Inc. ................................ 10,500 485,625
Mallinckrodt, Inc. ....................................... 1,200 52,950
Manor Care, Inc. ......................................... 1,000 27,000
Marriott International, Inc. ............................. 2,100 116,025
Marsh & McLennan Cos., Inc. .............................. 1,200 124,800
Masco Corp. .............................................. 2,700 97,200
Mattel, Inc. ............................................. 4,500 124,875
May Department Stores Co. ................................ 4,200 196,350
Maytag Corp. ............................................. 1,700 33,575
MBIA Inc. ................................................ 700 70,875
MBNA Corp. ............................................... 3,700 153,550
McDermott International, Inc. ............................ 900 14,962
McDonald's Corp. ......................................... 11,500 520,375
McDonnell Douglas Corp. .................................. 3,500 224,000
McGraw-Hill Cos., Inc. ................................... 1,600 73,800
MCI Communications Corp. ................................. 11,300 369,368
Mead Corp. ............................................... 900 52,312
Medtronic, Inc. .......................................... 4,000 272,000
Mellon Bank Corp. ........................................ 2,100 149,100
Mercantile Stores, Inc. .................................. 600 29,625
Merck & Co., Inc. ........................................ 20,000 1,585,000
Meredith Corp. ........................................... 400 21,100
Merrill Lynch & Co., Inc. ................................ 2,700 220,050
MGIC Investment Corp. .................................... 1,000 76,000
Micron Technology, Inc. .................................. 3,500 101,937
Microsoft Corp. .......................................... 19,800 1,635,975
Millipore Corp. .......................................... 700 28,962
Minnesota Mining & Mfg. Co. .............................. 6,900 571,837
Mobil Corp. .............................................. 6,500 794,625
Monsanto Co. ............................................. 9,700 377,087
Moore Corp., Ltd. ........................................ 1,700 34,637
Morgan (J.P.) & Co., Inc. ................................ 3,100 302,637
Morgan Stanley Group, Inc. ............................... 2,500 142,812
Morton International, Inc. ............................... 2,400 97,800
Motorola, Inc. ........................................... 9,800 601,475
NACCO Industries, Inc. Cl A............................... 100 5,350
Nalco Chemical Co. ....................................... 1,100 39,737
</TABLE>
20
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (EQUITY INDEX FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
INDEX PORTION (CONT'D):
National City Corp. ...................................... 3,700 $ 166,037
National Semiconductor Corp. ............................. 2,300 56,062
National Service Industries............................... 800 29,900
NationsBank Corp. ........................................ 4,800 469,200
Navistar International Corp. ............................. 1,200 10,950
New York Times Co. Cl A .................................. 1,600 60,800
Newell Co. ............................................... 2,600 81,900
Newmont Mining Corp. ..................................... 1,600 71,600
Niagara Mohawk Power Corp. ............................... 2,400 23,700
Nicor, Inc. .............................................. 800 28,600
Nike, Inc. Cl B .......................................... 4,800 286,800
NorAm Energy Corp. ....................................... 2,300 35,362
Nordstrom, Inc. .......................................... 1,300 46,068
Norfolk Southern Corp. ................................... 2,100 183,750
Northern States Power Co. ................................ 1,100 50,462
Northern Telecom, Ltd. ................................... 4,300 266,062
Northrop Grumman Corp. ................................... 1,000 82,750
Norwest Corp. ............................................ 6,100 265,350
Novell, Inc. ............................................. 5,700 53,972
Nucor Corp. .............................................. 1,500 76,500
NYNEX Corp. .............................................. 7,300 351,312
Occidental Petroleum Corp. ............................... 5,400 126,225
Ohio Edison Co. .......................................... 2,500 56,875
Oneok, Inc. .............................................. 500 15,000
Oracle Corp. ............................................. 10,900 455,075
Oryx Energy Co. .......................................... 1,700 42,075
Owens Corning............................................. 900 38,362
Paccar, Inc. ............................................. 600 40,800
Pacific Enterprises ...................................... 1,400 42,525
Pacific Telesis Group .................................... 7,100 260,925
PacifiCorp ............................................... 4,900 100,450
Pall Corp. ............................................... 1,900 48,450
PanEnergy Corp. .......................................... 2,500 112,500
Parker Hannifin Corp. .................................... 1,200 46,500
Peco Energy Co. .......................................... 3,700 93,425
Penney (J.C.) Co., Inc. .................................. 3,800 185,250
Pennzoil Co. ............................................. 800 45,200
Peoples Energy Corp. ..................................... 600 20,325
Pep Boys-Manny, Moe & Jack................................ 1,000 30,750
Pepsico, Inc. ............................................ 25,700 751,725
Perkin-Elmer Corp. ....................................... 700 41,212
Pfizer, Inc. ............................................. 10,700 886,762
PG & E Corp. ............................................. 6,800 142,800
Pharmacia & Upjohn, Inc. ................................. 8,400 332,850
Phelps Dodge Corp. ....................................... 1,100 74,250
Phillip Morris Cos., Inc. ................................ 13,500 1,520,437
Phillips Petroleum Co. ................................... 4,400 194,700
Pioneer Hi-Bred Intl., Inc. .............................. 1,400 98,000
Pitney Bowes, Inc. ....................................... 2,500 136,250
Placer Dome, Inc. ........................................ 4,000 87,000
PNC Bank Corp. ........................................... 5,600 210,700
Polaroid Corp. ........................................... 800 34,800
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Potlatch Corp. ........................................... 500 $ 21,500
PP&L Resources, Inc. ..................................... 2,700 62,100
PPG Industries, Inc. ..................................... 3,000 168,375
Praxair, Inc. ............................................ 2,600 119,925
Price/Costco, Inc. ....................................... 3,300 82,912
Proctor & Gamble Co. ..................................... 11,300 1,214,750
Providian Corp. .......................................... 1,600 82,200
Public Svc. Enterprise Group.............................. 3,900 106,275
Pulte Corp. .............................................. 400 12,300
Quaker Oats Co. .......................................... 2,200 83,875
Ralston Purina Co. ....................................... 1,800 132,075
Raychem Corp. ............................................ 700 56,087
Raytheon Co. ............................................. 3,900 187,687
Reebok International Ltd. ................................ 900 37,800
Republic New York Corp. .................................. 900 73,462
Reynold's Metals Co. ..................................... 1,100 62,012
Rite-Aid Corp. ........................................... 2,000 79,500
Rockwell Intl Corp ....................................... 3,600 219,150
Rohm & Haas Co. .......................................... 1,100 89,787
Rowan Cos., Inc. ......................................... 1,400 31,675
Royal Dutch Petroleum Co. ................................ 8,900 1,519,675
Rubbermaid, Inc. ......................................... 2,500 56,875
Russell Corp. ............................................ 600 17,850
Ryder System, Inc. ....................................... 1,400 39,375
Safeco Corp. ............................................. 2,100 82,818
Safety Kleen Corp. ....................................... 1,000 16,375
Salomon, Inc. ............................................ 1,800 84,825
Santa Fe Energy Resources, Inc ........................... 1,500 20,812
Sante Fe Pacific Gold Corp. .............................. 2,200 33,825
Sara Lee Corp. ........................................... 8,000 298,000
SBC Communications, Inc. ................................. 10,000 517,500
Schering-Plough Corp. .................................... 6,100 394,975
Schlumberger, Ltd. ....................................... 4,100 409,487
Scientific-Atlanta, Inc. ................................. 1,300 19,500
Seagate Technology, Inc. ................................. 4,100 161,950
Seagram, Ltd. ............................................ 6,200 240,250
Sears Roebuck & Co. ...................................... 6,500 299,812
Service Corp. International............................... 3,900 109,200
Shared Medical Systems Corp. ............................. 400 19,700
Sherwin-Williams Co. ..................................... 1,400 78,400
Sigma Aldrich Corp. ...................................... 800 49,950
Silicon Graphics, Inc. ................................... 2,900 73,950
Snap-On, Inc. ............................................ 1,000 35,625
Sonat, Inc. .............................................. 1,400 72,100
Southern Co. ............................................. 11,200 253,400
Southwest Airlines Co. ................................... 2,400 53,100
Springs Industries, Inc. Cl A ............................ 300 12,900
Sprint Corp. ............................................. 7,100 283,112
St. Jude Medical, Inc. ................................... 1,300 55,412
St. Paul Companies (The) ................................. 1,400 82,075
Stanley Works............................................. 1,500 40,500
Stone Container Corp. .................................... 1,600 23,800
Stride Rite Corp. ........................................ 800 8,000
Sun Co., Inc. ............................................ 1,200 29,250
</TABLE>
21
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (EQUITY INDEX FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
INDEX PORTION (CONT'D):
Sun Microsystems, Inc. ................................... 6,100 $ 156,693
Suntrust Banks, Inc. ..................................... 3,700 182,225
Supervalu, Inc. .......................................... 1,100 31,212
Sysco Corp. .............................................. 3,000 97,875
Tandem Computers, Inc. ................................... 2,000 27,500
Tandy Corp. .............................................. 1,000 44,000
Tektronix, Inc. .......................................... 500 25,625
Tele-Communications, Inc. Cl A............................ 11,000 143,687
Tellabs, Inc. ............................................ 3,000 112,875
Temple-Inland, Inc. ...................................... 900 48,712
Tenet Healthcare Corp. ................................... 3,600 78,750
Tenneco, Inc. ............................................ 2,800 126,350
Texaco, Inc. ............................................. 4,400 431,750
Texas Instruments, Inc. .................................. 3,100 197,625
Texas Utilities Co. ...................................... 3,700 150,775
Textron, Inc. ............................................ 1,400 131,950
Thermo Electron Corp. .................................... 2,700 111,375
Thomas & Betts Corp. ..................................... 900 39,937
Time Warner, Inc. ........................................ 9,400 352,500
Times Mirror Co. Cl A..................................... 1,600 79,600
Timken Co. ............................................... 500 22,937
TJX Cos., Inc. ........................................... 1,300 61,587
Torchmark Corp. .......................................... 1,200 60,600
Toys R Us, Inc. .......................................... 4,500 135,000
Transamerica Corp. ....................................... 1,100 86,900
Travelers Group, Inc. .................................... 10,600 480,974
Tribune Co. .............................................. 1,000 78,875
Trinova Corp. ............................................ 500 18,187
TRW, Inc. ................................................ 2,100 103,950
Tupperware Corp. ......................................... 1,000 53,625
Tyco Labs, Inc. .......................................... 2,600 137,475
U.S. Bancorp ............................................. 2,500 112,343
U.S. Life Corp. .......................................... 600 19,950
U.S. Surgical Corp. ...................................... 1,000 39,375
U.S. West Communications Group............................ 7,900 254,775
U.S. West Media Group..................................... 10,300 190,550
Unicom Corp. ............................................. 3,600 97,650
Unilever N.V. ............................................ 2,600 455,650
Union Camp Corp. ......................................... 1,200 57,300
Union Carbide Corp. ...................................... 2,100 85,837
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Union Electric Co. ........................................ 1,700 $ 65,450
Union Pacific Corp. ....................................... 4,100 246,512
Union Pacific Resources Grp. .............................. 4,100 119,925
Unisys Corp. .............................................. 2,900 19,575
United Healthcare Corp. ................................... 3,000 135,000
United Technologies Corp. ................................. 4,000 264,000
Unocal Corp. .............................................. 4,100 166,562
UNUM Corp. ................................................ 1,200 86,700
USAir Group, Inc. ......................................... 1,100 25,712
USF&G Corp. ............................................... 1,900 39,662
UST, Inc. ................................................. 3,100 100,362
USX-Marathon Group......................................... 4,800 114,600
USX-U.S. Steel Group, Inc. ................................ 1,400 43,925
V F Corp. ................................................. 1,100 74,250
Viacom, Inc. .............................................. 5,901 205,786
W.R. Grace & Co. .......................................... 1,500 77,625
Wachovia Corp. ............................................ 2,700 152,550
Wal-Mart Stores, Inc. ..................................... 38,000 869,250
Walgreen Co. .............................................. 4,100 164,000
Warner-Lambert Co. ........................................ 4,500 337,500
Wells Fargo & Co. ......................................... 1,500 404,732
Wendy's International, Inc. ............................... 2,100 43,050
Western Atlas, Inc. ....................................... 900 63,787
Westinghouse Electric Corp. ............................... 7,000 139,125
Westvaco Corp. ............................................ 1,700 48,875
Weyerhaeuser Co. .......................................... 3,300 156,337
Whirlpool Corp. ........................................... 1,200 55,950
Whitman Corp. ............................................. 1,700 38,887
Willamette Industries, Inc. ............................... 900 62,662
Williams Cos., Inc. ....................................... 2,550 95,625
Winn-Dixie Stores, Inc. ................................... 2,500 79,062
WMX Technologies, Inc. .................................... 8,000 261,000
Woolworth Corp. ........................................... 2,200 48,125
WorldCom, Inc. ............................................ 6,800 177,225
Worthington Industries, Inc. .............................. 1,500 27,187
Wrigley (Wm.) Jr. Co. ..................................... 1,900 106,875
Xerox Corp. ............................................... 5,400 284,241
------------
TOTAL INDEX PORTION--
COMMON STOCKS
(Cost: $72,879,503) 91.5%......................................... 93,375,768
------------
</TABLE>
22
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (EQUITY INDEX FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
---- -------- ---------- ------------
<S> <C> <C> <C> <C>
ACTIVE PORTION:
- ---------------
SHORT-TERM DEBT SECURITIES:
U.S. Government (0.3%)
U.S. Treasury Bill..................... 5.0% 03/20/97 $ 20,000 $ 19,788
U.S. Treasury Bill..................... 5.0 05/29/97 115,000 112,586
U.S. Treasury Bill..................... 5.0 05/15/97 135,000 132,425
U.S. Treasury Bill..................... 4.9 01/09/97 50,000 49,945
------------
314,744
------------
Commercial Paper (8.2%)
Warner-Lambert Co...................... 6.0 01/07/97 2,147,000 2,144,853
Allied Signal, Inc. ................... 6.1 01/02/97 1,806,000 1,805,694
Ford Motor Credit Corp................. 5.7 01/02/97 2,647,000 2,646,579
General Electric Capital Corp.......... 6.0 01/02/97 1,805,000 1,804,699
------------
8,401,825
------------
TOTAL ACTIVE PORTION -- SHORT-TERM DEBT SECURITIES
(Cost: $8,716,669) 8.5%......................................... 8,716,569
------------
TOTAL INVESTMENTS
(Cost: $81,596,172) 100.0%...................................... $102,092,337
============
</TABLE>
- -------
FUTURES CONTRACTS OUTSTANDING AS OF DECEMBER 31, 1996:
<TABLE>
<CAPTION>
UNDERLYING FACE UNREALIZED
EXPIRATION DATE AMOUNT AT VALUE LOSS
--------------- --------------- ----------
<S> <C> <C> <C>
PURCHASED
22 S&P 500 Stock Index Futures Con-
tracts............................. March 1997 $8,189,500 $(32,300)
========== ========
</TABLE>
The face value of futures purchased and outstanding as percentage of total
investment in securities--8.0%.
23
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
----- -------- ----------- ------------
<S> <C> <C> <C> <C>
LONG-TERM DEBT
SECURITIES:
U.S. Government (17.5%)
U.S. Treasury Bond...... 6.75% 08/15/26 $ 6,500,000 $ 6,548,750
U.S. Treasury Note...... 5.13 04/30/98 5,000,000 4,961,700
U.S. Treasury Note...... 4.75 09/30/98 5,000,000 4,910,950
U.S. Treasury Note...... 6.50 08/15/05 25,000,000 25,160,250
U.S. Treasury Note...... 5.00 01/31/98 15,000,000 14,894,550
------------
56,476,200
------------
Agencies/Government--
Other (18.0%)
City of New York........ 10.00 08/01/05 2,000,000 2,266,200
City of New York Taxable
Prerefunded............ 9.50 06/01/09 3,265,000 3,669,533
City of New York Taxable
Unrefunded............. 9.50 06/01/09 1,735,000 1,982,064
Connecticut Housing Fin.
Auth. ................. 7.63 05/15/21 2,500,000 2,388,525
Federal Home Loan Mtge.
Corp. ................. 8.00 07/15/06 953,011 977,426
Federal Home Loan Mtge.
Corp. ................. 7.95 02/15/20 1,153,160 1,173,697
Federal Home Loan Mtge.
Corp. ................. 8.50 02/15/21 3,007,772 3,061,341
Federal Home Loan Mtge.
Corp. ................. 7.50 06/15/19 3,913,841 3,970,082
Federal Home Loan Mtge.
Corp. ................. 7.25 02/15/19 834,253 838,683
Federal National Mtge
Assn. ................. 8.95 09/25/19 579,647 591,419
Federal National Mtge
Assn. ................. 7.50 01/25/19 460,314 462,040
Federal National Mtge
Assn. ................. 7.00 08/25/20 540,000 543,202
Federal National Mtge
Assn. ................. 8.50 08/25/18 1,399,456 1,410,385
Federal National Mtge
Assn. ................. 7.95 11/25/19 728,821 736,334
Federal National Mtge
Assn. ................. 7.50 06/25/20 496,025 499,898
Federal National Mtge
Assn. ................. 7.50 04/25/20 1,426,642 1,434,659
Federal National Mtge
Assn. ................. 7.75 10/25/00 925,000 925,860
Federal National Mtge
Assn. ................. 8.15 08/25/05 800,000 816,496
Pulaski County, Arkansas
PFB.................... 7.50 01/01/07 515,244 539,975
Republic of Iceland..... 6.13 02/01/04 5,000,000 4,825,700
State of California..... 8.15 09/01/01 1,000,000 1,063,750
Suffolk County, New
York................... 5.80 11/01/04 4,000,000 3,761,720
Suffolk County, New
York................... 5.88 11/01/05 4,000,000 3,738,320
Swedish Export Credit... 9.88 03/15/38 6,000,000 6,512,640
Tennessee Valley
Authority.............. 7.85 06/15/44 10,000,000 10,197,500
------------
58,387,449
------------
Basic Materials (3.2%)
Fletcher Challenge Ltd.. 9.00 09/15/99 2,000,000 2,106,000
Inco Ltd................ 9.60 06/15/22 7,500,000 8,172,300
------------
10,278,300
------------
Consumer, Cyclical (8.3%)
Centex Corp............. 7.38 06/01/05 5,000,000 4,863,650
Costco Wholesale Corp... 5.75 05/15/02 5,000,000 4,850,000
Fruit of the Loom, Inc.. 7.88 10/15/99 1,000,000 1,024,810
Gannett, Inc............ 5.85 05/01/00 3,500,000 3,436,405
Nordstrom, Inc.......... 8.88 02/15/98 1,500,000 1,544,415
Shopko Stores, Inc...... 9.00 11/15/04 5,000,000 4,860,600
V F Corp................ 9.25 05/01/22 1,000,000 1,103,820
Valassis Communication,
Inc.................... 9.55 12/01/03 5,000,000 5,203,200
------------
26,886,900
------------
</TABLE>
24
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
----- -------- ----------- ------------
<S> <C> <C> <C> <C>
Consumer, Non-Cyclical (5.7%)
McKesson Corp......................... 8.63% 02/01/98 $ 1,000,000 $ 1,019,330
Ralston Purina Co. ................... 8.63 02/15/22 7,500,000 8,343,075
Rhone-Poulenc S A..................... 6.75 10/15/99 2,500,000 2,520,275
Rhone-Poulenc S A..................... 7.75 01/15/02 3,000,000 3,104,160
Whitman Corp. ........................ 7.63 06/15/15 3,500,000 3,535,000
------------
18,521,840
------------
Energy (4.7%)
Southern Union Co. ................... 7.60 02/01/24 10,000,000 9,778,300
Tosco Corp............................ 8.25 05/15/03 5,000,000 5,296,750
------------
15,075,050
------------
Financial (14.0%)
Aristar, Inc. ........................ 8.88 08/15/98 2,000,000 2,081,460
Berkley (W.R.) Corp................... 8.70 01/01/22 5,000,000 5,495,600
British Gas Financial, Inc............ 8.75 03/15/98 3,000,000 3,087,990
Fairfax Financial Holdings............ 8.25 10/01/15 2,500,000 2,599,925
Heller Financial, Inc. ............... 9.13 08/01/99 2,000,000 2,118,860
Kemper Corp. ......................... 8.80 11/01/98 2,500,000 2,604,725
Progressive Corp. of Ohio............. 10.00 12/15/00 1,500,000 1,674,660
Rodamco NV............................ 7.75 05/15/15 5,000,000 5,124,050
Roosevelt Fed. Svgs. & Ln. Assn. ..... 10.13 04/15/18 3,000,000 3,129,450
Ryland Acceptance Corp. .............. 7.95 08/20/19 1,903,853 1,926,451
Sun America, Inc...................... 9.95 02/01/12 5,000,000 6,021,200
Sun America, Inc...................... 9.00 01/15/99 4,000,000 4,193,600
Vesta Insurance Group, Inc. .......... 8.75 07/15/25 5,000,000 5,392,900
------------
45,450,871
------------
Industrial (0.9%)
Union Pacific Corp. .................. 8.50 01/15/98 3,000,000 3,073,200
------------
Utilities (16.0%)
Big Rivers Electric Corp.............. 10.70 09/15/17 10,000,000 10,826,300
Big Rivers Electric Corp.............. 9.52 03/15/19 12,500,000 13,522,750
Big Rivers Electric Corp.............. 9.50 02/15/17 8,000,000 8,634,240
New Orleans Public Service............ 8.00 03/01/06 4,000,000 3,955,560
Oklahoma Gas & Elec. Co. ............. 8.88 12/01/20 7,500,000 7,671,900
Pacific Gas & Electric Co............. 8.75 01/01/01 2,000,000 2,150,900
Philadelphia Electric Co.............. 7.13 08/15/23 5,000,000 4,833,158
------------
51,594,808
------------
TOTAL LONG-TERM DEBT SECURITIES
(Cost: $282,522,417) 88.3%....................................... 285,744,618
------------
</TABLE>
25
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
----- -------- ----------- ------------
<S> <C> <C> <C> <C>
SHORT-TERM DEBT SECURITIES:
Commercial Paper (7.0%)
Allied Signal, Inc.................... 5.65% 01/23/97 $ 1,494,000 $ 1,488,841
Baltimore Gas & Electric Co........... 5.45 01/14/97 3,585,000 3,577,928
Baltimore Gas & Electric Co........... 5.78 01/06/97 3,000,000 2,997,588
Becton Dickinson...................... 5.50 01/07/97 2,641,000 2,638,575
Ford Motor Credit Corp. .............. 5.40 01/07/97 2,395,000 2,392,835
General Electric Capital Corp. ....... 5.42 01/03/97 2,395,000 2,394,276
Sony Capital Corp..................... 5.30 01/13/97 2,570,000 2,565,426
Sony Capital Corp..................... 5.31 01/15/97 2,030,000 2,025,781
UBS Finance Del. Inc. ................ 8.00 01/02/97 2,500,000 2,499,444
------------
22,580,694
------------
Consumer, Cyclical (0.8%)
Dillard Dept. Stores, Inc............. 9.63 09/15/97 1,000,000 1,024,660
Penney (J.C.) Co., Inc................ 10.00 10/15/97 1,500,000 1,545,525
------------
2,570,185
------------
Financial (3.9%)
Chase Manhattan Corp. ................ 7.50 12/01/97 5,000,000 5,062,200
General Motors Acceptance Corp. ...... 7.88 03/04/97 2,500,000 2,509,100
General Motors Acceptance Corp. ...... 8.38 05/01/97 5,000,000 5,040,650
------------
12,611,950
------------
TOTAL SHORT-TERM DEBT SECURITIES
(Cost: $37,717,639) 11.7%........................................ 37,762,829
------------
TOTAL INVESTMENTS
(Cost: $320,240,056) 100.0%...................................... $323,507,447
============
</TABLE>
26
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (SHORT-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
---- -------- ---------- -----------
<S> <C> <C> <C> <C>
INTERMEDIATE-TERM DEBT SECURITIES:
U.S. Government (27.4%)
U.S. Treasury Note....................... 4.75% 09/30/98 $1,000,000 $ 982,190
U.S. Treasury Note....................... 5.13 04/30/98 1,000,000 992,340
U.S. Treasury Note....................... 5.88 11/15/99 750,000 747,067
U.S. Treasury Note....................... 5.13 06/30/98 1,000,000 990,940
U.S. Treasury Note....................... 5.00 01/31/98 500,000 496,485
-----------
4,209,022
-----------
Agencies/Government--Other (51.3%)
Federal Home Loan Mtge. Corp. ........... 7.75 08/15/15 224,494 227,089
Federal Home Loan Mtge. Corp. ........... 7.75 12/01/02 478,262 495,275
Federal Home Loan Mtge. Corp. ........... 8.00 04/01/02 452,376 476,808
Federal Home Loan Mtge. Corp. ........... 6.00 05/15/22 294,622 286,242
Federal Home Loan Mtge. Corp. ........... 7.25 02/15/19 210,377 211,493
Federal Home Loan Mtge. Corp. ........... 7.50 06/15/19 682,647 692,456
Federal Home Loan Mtge. Corp. ........... 7.95 02/15/20 262,725 267,404
Federal Home Loan Mtge. Corp. ........... 8.00 12/15/18 721,179 736,049
Federal Home Loan Mtge. Corp. ........... 8.00 11/15/05 500,000 512,340
Federal National Mtge. Assn. ............ 7.50 01/25/19 228,501 229,358
Federal National Mtge. Assn. ............ 8.95 09/25/19 211,447 215,741
Federal National Mtge. Assn. ............ 7.50 10/25/19 136,005 136,641
Federal National Mtge. Assn. ............ 8.25 09/25/05 320,268 327,272
Federal National Mtge. Assn. ............ 7.95 11/25/19 232,262 234,656
Federal National Mtge. Assn. ............ 7.00 05/25/16 212,126 212,921
Federal National Mtge. Assn. ............ 7.75 10/25/18 520,477 526,655
Federal National Mtge. Assn. ............ 8.50 08/25/18 198,097 199,643
Federal National Mtge. Assn. ............ 7.50 06/25/20 416,661 419,914
Federal National Mtge. Assn. ............ 7.00 12/25/19 212,888 213,752
Federal National Mtge. Assn. ............ 7.00 01/25/21 180,526 181,203
Federal National Mtge. Assn. ............ 7.00 08/25/20 375,000 377,223
Federal National Mtge. Assn. ............ 7.75 10/25/00 375,000 375,348
Pulaski County, Arkansas PFB............. 7.50 01/01/07 320,596 335,984
-----------
7,891,467
-----------
Financial (3.7%)
FBC Mortgage Secur. Trust................ 8.30 08/20/09 207,772 211,407
GE Capital Mtge. Services, Inc. ......... 6.00 09/25/08 351,483 350,164
-----------
561,571
-----------
Utilities (0.7%)
Big Rivers Electric Corp. ............... 9.50 02/15/17 100,000 107,928
-----------
TOTAL INTERMEDIATE-TERM DEBT SECURITIES
(Cost: $12,711,764) 83.1%......................................... 12,769,988
-----------
</TABLE>
27
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (SHORT-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
---- -------- ---------- -----------
<S> <C> <C> <C> <C>
SHORT-TERM DEBT SECURITIES:
U.S. Government (6.5%)
U.S. Treasury Note...................... 5.75% 09/30/97 $1,000,000 $ 1,001,720
-----------
Commercial Paper (9.7%)
Ford Motor Credit Corp. ................ 5.62 01/03/97 315,000 314,901
General Electric Capital Corp. ......... 5.40 01/03/97 100,000 99,970
IBM Credit Corp. ....................... 5.42 01/24/97 273,000 272,053
Merrill Lynch & Co., Inc. .............. 5.33 01/03/97 245,000 244,927
Petrofina Delaware Inc. ................ 6.50 01/02/97 436,000 435,921
Potomac Electric Power Co. ............. 5.90 01/06/97 124,000 123,898
-----------
1,491,670
-----------
Technology (0.7%)
McDonnell Douglas Corp.................. 8.63 04/01/97 100,000 100,657
-----------
TOTAL SHORT-TERM DEBT SECURITIES
(Cost: $2,595,920) 16.9%......................................... 2,594,047
-----------
TOTAL INVESTMENTS
(Cost: $15,307,684) 100.0%....................................... $15,364,035
===========
</TABLE>
28
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (MID-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
----- -------- ---------- -----------
<S> <C> <C> <C> <C>
INTERMEDIATE-DEBT SECURITIES:
U.S. Government (35.9%)
U.S. Treasury Note...................... 6.38% 09/30/01 $3,250,000 $ 3,269,305
U.S. Treasury Note...................... 5.88 02/15/04 1,500,000 1,460,385
-----------
4,729,690
-----------
Agencies/Government--Other (6.7%)
Federal Home Loan Mtge Corp............. 8.00 07/15/06 476,505 488,713
City of New York........................ 9.50 06/01/09 230,000 258,497
City of New York........................ 9.50 06/01/09 120,000 137,088
-----------
884,298
-----------
Consumer, Cyclical (3.8%)
Costco Wholesale Corp................... 5.75 05/15/02 250,000 242,500
Fruit of the Loom, Inc.................. 7.88 10/15/99 250,000 256,202
-----------
498,702
-----------
Financial (11.7%)
Bear Stearns Cos., Inc.................. 9.38 06/01/01 250,000 274,680
General Motors Acceptance Corp. ........ 8.38 05/01/97 250,000 252,032
Smith Barney Hldgs., Inc. .............. 6.50 10/15/02 500,000 491,710
Sun America, Inc........................ 9.00 01/15/99 500,000 524,200
-----------
1,542,622
-----------
Industrial (4.0%)
Airborne Freight Corp................... 8.88 12/15/02 250,000 267,177
Comdisco, Inc. ......................... 7.75 09/01/99 250,000 256,922
-----------
524,099
-----------
Utilities (12.9%)
Baltimore Gas & Electric Co............. 6.13 07/01/03 250,000 242,445
Big Rivers Electric Corp................ 9.50 02/15/17 200,000 215,856
Commonwealth Edison Co.................. 7.50 01/01/01 500,000 499,615
Connecticut Light & Power Co. .......... 5.50 02/01/99 500,000 483,855
Public Svc. Electric & Gas Co........... 7.88 11/01/01 250,000 261,442
-----------
1,703,213
-----------
TOTAL INTERMEDIATE-TERM DEBT SECURITIES
(Cost: $9,858,870) 75.0%.......................................... 9,882,624
-----------
</TABLE>
29
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (MID-TERM BOND FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
---- -------- ---------- -----------
<S> <C> <C> <C> <C>
SHORT-TERM DEBT SECURITIES:
Agencies (17.5%)
Federal Home Loan Bank.................. 5.55% 01/06/97 $2,300,000 $ 2,298,227
-----------
Commercial Paper (7.5%)
Baltimore Gas & Electric Co. ........... 5.78 01/06/97 326,000 325,737
General Electric Capital Corp. ......... 5.40 01/03/97 100,000 99,970
Merrill Lynch & Co., Inc. .............. 5.80 01/03/97 326,000 325,895
Petrofina Delaware Inc. ................ 6.50 01/02/97 240,000 239,957
-----------
991,559
-----------
TOTAL SHORT-TERM DEBT SECURITIES
(Cost: $3,289,786) 25.0%......................................... 3,289,786
-----------
TOTAL INVESTMENTS
(Cost: $13,148,656) 100.0%....................................... $13,172,410
===========
</TABLE>
30
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (COMPOSITE FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
COMMON STOCKS:
Basic Materials (6.6%)
Air Products & Chemicals Corp. ........................... 25,000 $ 1,728,125
Aluminum Co. of America................................... 15,000 956,250
Homestake Mining Co. ..................................... 110,000 1,567,500
IMC Global, Inc. ......................................... 65,000 2,543,125
Inland Steel, Inc.* ...................................... 56,000 1,120,000
LTV Corp. ................................................ 267,000 3,170,625
Methanex Corp.* .......................................... 125,000 1,125,000
Nucor Corp. .............................................. 25,000 1,275,000
Reynold's Metals Co. ..................................... 30,000 1,691,250
USX-U.S. Steel Group, Inc. ............................... 110,000 3,451,250
------------
18,628,125
------------
Consumer, Cyclical (6.2%)
AutoZone, Inc.* .......................................... 12,500 343,750
BRC Holdings, Inc.* ...................................... 12,500 559,375
Centex Corp. ............................................. 45,000 1,693,125
Eastman Kodak Co. ........................................ 7,000 561,750
Federal-Mogul Corp. ...................................... 100,000 2,200,000
General Motors Corp. ..................................... 100,000 5,575,000
Grupo Televisa S.A.-Spons GDR*............................ 35,000 896,875
OfficeMax, Inc.*.......................................... 70,000 743,750
Offshore Logistics, Inc.*................................. 101,000 1,956,875
Rollins Truck Leasing Co. ................................ 110,000 1,388,750
TCI Satellite Entertainment*.............................. 12,000 118,500
Tele-Communications, Inc. Cl A*........................... 120,000 1,567,500
------------
17,605,250
------------
Consumer, Non-Cyclical (0.5%)
Pepsi-Cola Puerto Rico Bottle*............................ 34,900 139,600
Scherer (R.P.) Corp.*..................................... 25,000 1,256,250
------------
1,395,850
------------
Energy (20.2%)
Apache Corp. ............................................. 75,000 2,653,125
Cairn Energy USA, Inc.*................................... 120,000 1,200,000
Chieftan International, Inc.*............................. 95,000 2,470,000
Dresser Industries, Inc. ................................. 90,000 2,790,000
Enron Oil & Gas Co. ...................................... 110,000 2,777,500
Global Industries Ltd.*................................... 35,000 651,875
Lomak Petroleum, Inc. .................................... 84,100 1,440,212
Marine Drilling Companies, Inc*........................... 32,500 639,843
Nabors Industries, Inc.*.................................. 369,000 7,103,250
Occidental Petroleum Corp. ............................... 105,000 2,454,375
Oceaneering Int'l, Inc.*.................................. 247,900 3,935,412
Parker & Parsley Petroleum Co............................. 45,000 1,653,750
Peoples Energy Corp....................................... 66,000 2,235,750
Pride Petroleum Svcs., Inc.*.............................. 397,000 9,230,250
Reading & Bates Corp.*.................................... 25,000 662,500
Seagull Energy Corp.*..................................... 130,000 2,860,000
United Meridian Corp.*.................................... 10,000 517,500
USX-Marathon Group........................................ 310,000 7,401,250
Western Atlas, Inc.*...................................... 61,000 4,323,375
------------
56,999,967
------------
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Financial (1.6%)
Horace Mann Educators Corp. .............................. 60,000 $ 2,422,500
New Plan Realty Trust..................................... 80,700 2,047,762
------------
4,470,262
------------
Industrial (13.2%)
Anixter International, Inc.*.............................. 120,000 1,935,000
Browning Ferris Inds., Inc................................ 45,000 1,181,250
BWAY Corp.*............................................... 37,000 707,625
Cooper Industries......................................... 30,000 1,263,750
Covenant Transport, Inc. Cl A*............................ 25,000 359,375
Fingerhut Companies, Inc.................................. 65,000 796,250
Fluor Corp. .............................................. 61,300 3,846,575
Hanson PLC--ADR........................................... 490,000 3,307,500
Interim Services, Inc.*................................... 50,500 1,792,750
Lafarge Corp. ............................................ 153,000 3,079,125
Pall Corp. ............................................... 40,000 1,020,000
Powell Industries, Inc.*.................................. 100,000 1,387,500
Railtex, Inc.*............................................ 20,000 505,000
Sea Containers, Ltd. Cl A................................. 105,000 1,640,625
Silicon Valley Group, Inc.*............................... 130,000 2,616,250
Smith International, Inc.*................................ 60,000 2,692,500
The Peak Technologies Group*.............................. 209,300 2,511,600
Vallen Corp.*............................................. 55,000 914,375
Waste Management Intl. PLC*............................... 175,000 1,378,125
WMX Technologies, Inc..................................... 135,000 4,404,375
------------
37,339,550
------------
Technology (3.5%)
Activision, Inc.*......................................... 50,000 643,750
Alliance Semiconductor Corp.*............................. 135,000 961,875
AT&T Corp................................................. 55,000 2,392,500
FastComm Communications Corp.*............................ 43,000 263,375
GenCorp, Inc.............................................. 155,000 2,809,375
LSI Logic Corp.*.......................................... 45,000 1,203,750
Lucent Technologies, Inc.................................. 15,000 693,750
Minnesota Mining & Mfg. Co................................ 5,000 414,375
Symantec Corp.*........................................... 35,000 507,500
------------
9,890,250
------------
Utilities (1.0%)
GTE Corp. ................................................ 25,000 1,137,500
Telephone & Data Systems, Inc............................. 50,000 1,812,503
------------
2,950,003
------------
TOTAL COMMON STOCKS
(Cost: $128,141,273) 52.8%........................................ 149,279,257
------------
</TABLE>
- -------
* Non-income producing security.
31
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (COMPOSITE FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
----- -------- ---------- ------------
<S> <C> <C> <C> <C>
LONG-TERM DEBT SECURITIES:
U.S. Government (7.0%)
U.S. Treasury Bond..................... 6.75% 8/15/26 $2,500,000 $ 2,518,750
U.S. Treasury Note..................... 5.13 6/30/98 3,000,000 2,972,820
U.S. Treasury Note..................... 5.00 1/31/98 14,500,000 14,398,065
------------
19,889,635
------------
Agencies/Government--Other (5.8%)
City of New York....................... 10.00 8/1/05 500,000 566,550
City of New York....................... 9.50 6/1/09 1,310,000 1,472,309
City of New York....................... 9.50 6/1/09 690,000 788,256
Connecticut Housing Fin. Auth.......... 7.63 5/15/21 1,000,000 955,410
Federal Home Loan Mtge Corp. .......... 8.00 7/15/06 476,505 488,713
Republic of Iceland.................... 6.13 2/1/04 2,500,000 2,412,850
State of California.................... 8.15 9/1/01 500,000 531,875
Suffolk County, New York............... 5.88 11/1/05 750,000 700,935
Suffolk County, New York............... 5.80 11/1/04 250,000 235,107
Swedish Export Credit.................. 9.88 3/15/38 3,000,000 3,256,320
Tennessee Valley Authority............. 7.85 6/15/44 5,000,000 5,098,750
------------
16,507,075
------------
Basic Materials (1.0%)
Inco Ltd. ............................. 9.60 6/15/22 2,500,000 2,724,100
------------
Consumer, Cyclical (3.2%)
Centex Corp. .......................... 7.38 6/1/05 2,000,000 1,945,460
Costco Wholesale Corp. ................ 5.75 5/15/02 1,000,000 970,000
Dillard Dept. Stores, Inc. ............ 9.63 9/15/97 500,000 512,330
Fruit of the Loom, Inc. ............... 7.88 10/15/99 500,000 512,405
Gannett, Inc. ......................... 5.85 5/1/00 1,000,000 981,830
Nordstrom, Inc. ....................... 8.88 2/15/98 500,000 514,805
Penney (J.C.) Co., Inc. ............... 10.00 10/15/97 500,000 515,175
Shopko Stores, Inc. ................... 9.00 11/15/04 1,000,000 972,120
Valassis Communication, Inc. .......... 9.55 12/1/03 2,000,000 2,081,280
------------
9,005,405
------------
Consumer, Non-Cyclical (2.1%)
Ralston Purina Co. .................... 8.63 2/15/22 2,500,000 2,781,025
Rhone-Poulenc S A...................... 6.75 10/15/99 1,000,000 1,008,110
Rhone-Poulenc S A...................... 7.75 1/15/02 1,000,000 1,034,720
Whitman Corp. ......................... 7.63 6/15/15 1,000,000 1,010,000
------------
5,833,855
------------
Energy (2.7%)
Southern Union Co. .................... 7.60 2/1/24 5,000,000 4,889,150
Tosco Corp. ........................... 8.25 5/15/03 2,500,000 2,648,375
------------
7,537,525
------------
Financial (5.2%)
Aristar, Inc. ......................... 8.88 8/15/98 500,000 520,365
Berkley (W.R.) Corp. .................. 8.70 1/1/22 1,500,000 1,648,680
British Gas Financial, Inc. ........... 8.75 3/15/98 500,000 514,665
Chase Manhattan Corp. ................. 7.50 12/1/97 1,000,000 1,012,440
Fairfax Financial Holdings............. 8.25 10/1/15 500,000 519,985
General Motors Acceptance Corp. ....... 7.88 3/4/97 500,000 501,820
General Motors Acceptance Corp. ....... 8.38 5/1/97 750,000 756,098
Heller Financial, Inc. ................ 9.13 8/1/99 500,000 529,715
Kemper Corp. .......................... 8.80 11/1/98 500,000 520,945
Progressive Corp. of Ohio.............. 10.00 12/15/00 500,000 558,220
</TABLE>
32
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (COMPOSITE FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT VALUE
----- -------- ----------- ------------
<S> <C> <C> <C> <C>
LONG-TERM DEBT SECURITIES (CONT'D):
Rodamco NV............................ 7.75% 5/15/15 $ 2,000,000 $ 2,049,620
Roosevelt Fed. Svgs. & Ln. Assn. ..... 10.13 4/15/18 1,000,000 1,043,150
Sun America, Inc. .................... 9.95 2/1/12 2,000,000 2,408,480
Sun America, Inc. .................... 9.00 1/15/99 1,000,000 1,048,400
Vesta Insurance Group, Inc. .......... 8.75 7/15/25 1,000,000 1,078,580
------------
14,711,163
------------
Utilities (6.9%)
Big Rivers Electric Corp. ............ 10.70 9/15/17 4,000,000 4,330,520
Big Rivers Electric Corp. ............ 9.52 3/15/19 2,500,000 2,704,550
Big Rivers Electric Corp. ............ 9.50 2/15/17 2,000,000 2,158,560
Central Telephone Co. ................ 9.28 11/27/00 1,000,000 1,088,900
New Orleans Public Service............ 8.00 3/1/06 1,000,000 988,890
Oklahoma Gas & Elec Co. .............. 8.88 12/1/20 5,000,000 5,114,600
Pacific Gas & Electric Co. ........... 8.75 1/1/01 1,000,000 1,075,450
PacifiCorp............................ 8.73 2/12/98 1,000,000 1,029,990
Philadelphia Electric Co. ............ 7.13 8/15/23 1,000,000 966,630
------------
19,458,090
------------
TOTAL LONG-TERM DEBT SECURITIES
(Cost: $95,167,977) 33.9%........................................ 95,666,848
------------
SHORT-TERM DEBT SECURITIES:
Commercial Paper: (13.3%)
Air Products & Chemicals.............. 5.43 1/17/97 3,978,000 3,968,378
Allied Signal, Inc. .................. 5.65 1/23/97 2,013,000 2,006,048
Associates Corp. ..................... 5.38 1/8/97 5,000,000 4,994,751
Ford Motor Credit Corp. .............. 5.72 1/2/97 3,026,000 3,025,519
Ford Motor Credit Corp. .............. 5.40 1/7/97 1,775,000 1,773,396
General Electric Capital.............. 5.40 1/10/97 5,000,000 4,993,227
Heinz (H.J.) Co. ..................... 5.31 1/24/97 4,595,000 4,579,363
Intl Business Machines................ 5.30 1/6/97 1,890,000 1,888,600
PHH Corp. ............................ 5.35 1/6/97 4,210,000 4,206,848
Sony Capital Corp. ................... 5.31 1/15/97 2,990,000 2,983,785
UBS Finance Del Inc. ................. 8.00 1/2/97 3,200,000 3,199,289
------------
37,619,204
------------
TOTAL SHORT-TERM DEBT SECURITIES
(Cost: $37,619,204) 13.3%........................................ 37,619,204
------------
TOTAL INVESTMENTS
(Cost: $260,928,454) 100.0%...................................... $282,565,309
============
</TABLE>
33
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (COMPOSITE FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES
EXPIRATION EXERCISE SUBJECT
DATE PRICE TO CALL VALUE
---------- -------- ------- -----------
<S> <C> <C> <C> <C>
OPTIONS WRITTEN:
Air Products & Chemicals Corp. ........ 1/18/97 $70.00 5,000 $ (5,625)
Air Products & Chemicals Corp. ........ 2/22/97 70.00 5,000 (11,562)
Anixter International, Inc. ........... 1/18/97 17.50 2,500 (312)
Anixter International, Inc. ........... 1/18/97 15.00 10,000 (16,250)
Anixter International, Inc. ........... 7/19/97 17.50 3,000 (4,125)
Apache Corp. .......................... 4/19/97 35.00 7,500 (19,687)
AutoZone, Inc. ........................ 2/22/97 25.00 12,500 (35,937)
Browning Ferris Inds., Inc. ........... 3/22/97 25.00 30,000 (67,500)
Centex Corp. .......................... 1/18/97 30.00 19,000 (148,437)
Centex Corp. .......................... 1/18/97 35.00 16,000 (45,500)
Cooper Industries...................... 1/18/97 40.00 10,000 (25,000)
Cooper Industries...................... 4/19/97 40.00 5,000 (17,187)
Eastman Kodak Co. ..................... 1/18/97 75.00 7,000 (42,875)
FastComm Communications Corp. ......... 1/18/97 15.00 5,000 (468)
FastComm Communications Corp. ......... 1/18/97 10.00 12,500 (781)
Federal-Mogul Corp. ................... 7/19/97 20.00 5,000 (15,937)
Federal-Mogul Corp. ................... 4/19/97 20.00 5,000 (13,750)
Fluor Corp. ........................... 4/19/97 65.00 5,000 (15,000)
GenCorp, Inc. ......................... 3/22/97 17.50 10,000 (14,375)
General Motors Corp. .................. 3/22/97 55.00 10,000 (28,750)
General Motors Corp. .................. 1/18/97 60.00 10,000 (1,875)
General Motors Corp. .................. 1/18/97 55.00 15,000 (24,375)
Grupo Televisa S.A.-Spons. GDR ........ 1/18/97 30.00 10,000 (1,250)
Grupo Televisa S.A.-Spons. GDR ........ 1/18/97 27.50 5,000 (1,562)
GTE Corp. ............................. 3/22/97 45.00 15,000 (33,750)
GTE Corp. ............................. 1/18/97 42.50 10,000 (37,500)
Homestake Mining Co. .................. 1/18/97 17.50 10,000 (625)
IMC Global, Inc. ...................... 1/18/97 45.00 5,000 (625)
Interim Services, Inc. ................ 1/18/97 35.00 16,000 (19,000)
Interim Services, Inc. ................ 2/22/97 35.00 10,800 (18,900)
Lomak Petroleum, Inc. ................. 4/19/97 17.50 15,000 (20,625)
LSI Logic Corp. ....................... 1/18/97 25.00 15,000 (39,375)
LSI Logic Corp. ....................... 1/18/97 30.00 5,000 (1,875)
LSI Logic Corp. ....................... 4/19/97 30.00 5,000 (10,312)
Lucent Technologies, Inc. ............. 1/18/97 45.00 15,000 (36,562)
Marine Drilling Companies, Inc. ....... 2/22/97 20.00 15,000 (26,250)
Minnesota Mining & Mfg. Co. ........... 1/18/97 70.00 5,000 (70,000)
Nabors Industries, Inc. ............... 1/18/97 20.00 5,000 (3,906)
Nabors Industries, Inc. ............... 3/22/97 20.00 5,000 (6,250)
Nabors Industries, Inc. ............... 6/21/97 20.00 30,000 (52,500)
Oceaneering Int'l, Inc................. 1/18/97 17.50 12,000 (1,500)
Oceaneering Int'l, Inc. ............... 1/18/97 15.00 2,000 (2,250)
Parker & Parsley Petroleum Co. ........ 6/21/97 35.00 5,000 (22,812)
Pride Petroleum Svcs., Inc. ........... 1/18/97 17.50 5,000 (27,500)
Pride Petroleum Svcs., Inc............. 4/19/97 20.00 5,000 (19,687)
Reading & Bates Corp. ................. 3/22/97 30.00 5,000 (4,687)
Scherer (R.P.) Corp.................... 1/18/97 50.00 6,000 (10,312)
Scherer (R.P.) Corp.................... 1/18/97 45.00 5,000 (27,812)
Scherer (R.P.) Corp.................... 4/19/97 50.00 3,000 (8,625)
Seagull Energy Corp.................... 2/22/97 25.00 10,000 (5,000)
Seagull Energy Corp.................... 2/22/97 20.00 10,000 (25,625)
Silicon Valley Group, Inc. ............ 3/22/97 22.50 5,000 (5,469)
Silicon Valley Group, Inc. ............ 3/22/97 25.00 5,000 (2,500)
Smith International, Inc. ............. 1/18/97 35.00 22,500 (222,198)
Smith International, Inc. ............. 4/19/97 40.00 10,000 (70,000)
Smith International, Inc. ............. 1/18/97 40.00 27,500 (139,218)
</TABLE>
34
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (COMPOSITE FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES
EXPIRATION EXERCISE SUBJECT
DATE PRICE TO CALL VALUE VALUE
---------- -------- ------------- -----------
<S> <C> <C> <C> <C>
OPTIONS WRITTEN (CONT'D):
Symantec Corp................... 4/19/97 $17.50 5,000 $ (5,625)
Symantec Corp................... 1/18/97 10.00 20,000 (95,000)
United Meridian Corp............ 1/18/97 50.00 10,000 (44,375)
USX-Marathon Group.............. 1/18/97 22.50 15,000 (24,375)
WMX Technologies, Inc........... 2/22/97 35.00 10,000 (6,250)
-----------
TOTAL OPTIONS WRITTEN
(Premiums Received: $1,370,775).................................. $(1,706,995)
===========
</TABLE>
35
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (AGGRESSIVE EQUITY FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
COMMON STOCKS:
Basic Materials (1.8%)
ABT Building Products Corp.*.............................. 15,000 $ 375,000
Commonwealth Aluminum Corp.*.............................. 30,000 461,250
High Plains Corp.*........................................ 90,000 466,875
Mississippi Chemical Corp. ............................... 20,000 480,000
Nucor Corp. .............................................. 15,000 765,000
------------
2,548,125
------------
Consumer, Cyclical (15.0%)
Adelphia Communications Cl A.............................. 39,000 224,250
American Radio Systems Corp.*............................. 94,000 2,561,500
Brookstone, Inc.*......................................... 62,000 651,000
Chancellor Broadcasting Cl A*............................. 20,000 475,000
Damark International, Inc. Cl A*.......................... 5,000 47,500
Danka Business Systems--ADR............................... 40,000 1,415,000
Fleetwood Enterprises, Inc. .............................. 14,000 385,000
General Motors Corp. ..................................... 15,000 836,250
Grupo Televisa S.A.--Spons. GDR*.......................... 40,000 1,025,000
Nimbus CD International, Inc.*............................ 115,000 977,500
Offshore Logistics, Inc.*................................. 61,000 1,181,875
Petroleum Helicopters, Inc. .............................. 45,000 765,000
Rhodes, Inc.*............................................. 67,300 521,575
Southern Energy Homes, Inc.*.............................. 20,000 230,000
Synthetics Industries, Inc.*.............................. 40,000 650,000
TBC Corp.*................................................ 230,000 1,725,000
TCA Cable TV, Inc. ....................................... 75,000 2,259,375
TCI Satellite Entertainment*.............................. 35,000 345,625
Team Rental Group, Inc.*.................................. 50,000 806,250
Tele-Communications, Inc. Cl A*........................... 105,000 1,371,562
Todd-AO Corp. ............................................ 75,000 768,750
United Auto Group, Inc.*.................................. 50,000 1,287,500
ValueVision Intl., Inc. Cl A*............................. 23,000 123,625
WorldCorp, Inc.*.......................................... 160,000 700,000
------------
21,334,137
------------
Consumer, Non-Cyclical (8.2%)
Arrow International, Inc. ................................ 23,000 661,250
AVECOR Cardiovascular, Inc.*.............................. 109,000 1,335,250
Dentsply International, Inc. ............................. 44,000 2,090,000
Dominick's Supers, Inc.*.................................. 20,000 435,000
Healthcare COMPARE Corp.*................................. 4,500 190,687
Home Health Corp. of America*............................. 110,000 1,203,125
Liposome Company, Inc.*................................... 90,000 1,721,250
Matria Healthcare, Inc.*.................................. 130,000 617,500
Mylan Laboratories, Inc. ................................. 15,000 251,250
Orthodontic Centers of America*........................... 60,000 960,000
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
Pepsi-Cola Puerto Rico Bottling Co. Cl B*................. 12,500 $ 50,000
Protocol Systems, Inc.*................................... 52,000 676,000
Scherer (R.P.) Corp.*..................................... 30,000 1,507,500
------------
11,698,812
------------
Energy (17.1%)
Chieftan International, Inc.*............................. 65,000 1,690,000
ENSCO International, Inc.*................................ 10,000 485,000
Falcon Drilling Co., Inc.*................................ 2,500 98,125
Nabors Industries, Inc.*.................................. 180,000 3,465,000
New Jersey Resources Corp. ............................... 23,700 693,225
Oceaneering Int'l, Inc.*.................................. 160,000 2,540,000
Pride Petroleum Svcs., Inc.*.............................. 200,000 4,650,000
Ranger Oil Ltd. .......................................... 200,000 1,975,000
Southwest Gas Corp. ...................................... 38,500 741,125
Transocean Offshore, Inc. ................................ 21,500 1,346,437
Unit Corp.*............................................... 100,000 987,500
USX-Marathon Group........................................ 130,000 3,103,750
Vintage Petroleum, Inc. .................................. 20,000 690,000
Western Atlas, Inc.*...................................... 25,000 1,771,875
------------
24,237,037
------------
Financial (3.9%)
American Eagle Group, Inc. ............................... 60,000 285,000
Castle & Cooke, Inc.*..................................... 100,000 1,587,500
Delphi Financial Group, Inc.*............................. 46,000 1,357,000
Glenborough Realty Trust, Inc............................. 60,000 1,057,500
Gryphon Holdings, Inc.*................................... 92,500 1,306,562
------------
5,593,562
------------
Industrial (26.5%)
Abacan Resource Corp.*.................................... 162,500 1,411,718
AFC Cable Systems, Inc.*.................................. 39,000 931,125
Anixter International, Inc.*.............................. 60,000 967,500
Applied Power, Inc. Cl A.................................. 28,000 1,109,500
Baker Hughes, Inc. ....................................... 50,500 1,742,250
Browning Ferris Inds., Inc. .............................. 35,000 918,750
BWAY Corp.*............................................... 19,000 363,375
Celadon Group, Inc.*...................................... 37,000 407,000
Cuno, Inc.*............................................... 50,000 743,750
Dayton Superior Corp.*.................................... 60,000 787,500
Donnelly Corp. Cl A....................................... 25,000 612,500
Empresses ICA Sociedad ADS*............................... 75,000 1,096,875
Gardner Denver Machinery*................................. 39,000 1,335,750
Interim Services, Inc.*................................... 40,000 1,420,000
Lufkin Industries, Inc. .................................. 77,000 1,925,000
Molecular Dynamics, Inc.*................................. 100,000 1,075,000
Offshore Energy Development*.............................. 26,000 396,500
Pall Corp. ............................................... 65,000 1,657,500
Perkin-Elmer Corp. ....................................... 16,600 977,325
Powell Industries, Inc.*.................................. 100,000 1,387,500
Railtex, Inc.*............................................ 91,500 2,310,375
Robbins & Myers, Inc. .................................... 10,000 250,000
Sea Containers, Ltd. Cl A*................................ 54,000 843,750
Silicon Valley Group, Inc.*............................... 115,000 2,314,375
Smith International, Inc.*................................ 10,000 448,750
</TABLE>
36
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (AGGRESSIVE EQUITY FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
COMMON STOCKS (CONT'D):
Smithway Motor Xpress Corp.*............................. 70,000 $ 568,750
Stewart & Stevenson Svcs Inc. ........................... 73,000 2,126,125
The Peak Technologies Group*............................. 190,000 2,280,000
UCAR Int'l., Inc.*....................................... 40,000 1,505,000
Vallen Corp.*............................................ 61,000 1,014,125
Wackenhut Corp........................................... 65,000 991,250
Zero Corp. .............................................. 80,000 1,600,000
------------
37,518,918
------------
Technology (15.9%)
360 Communications Co.*.................................. 85,000 1,965,625
Alliance Semiconductor Corp.*............................ 40,000 285,000
Andrew Corp.*............................................ 50,000 2,653,125
Associated Group, Inc.*.................................. 20,000 615,000
Coherent Comm. Systems Corp.*............................ 61,500 1,199,250
Comcast Corp. Cl A*...................................... 30,000 534,375
Davel Communications Group, Inc.*........................ 7,500 136,875
DSC Communications Corp.*................................ 95,000 1,698,125
DST Systems, Inc.*....................................... 36,500 1,145,187
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C>
GenCorp, Inc.............................................. 50,000 $ 906,250
General Instrument Corp.*................................. 90,000 1,946,250
HNC Software*............................................. 5,000 156,250
Intuit, Inc.*............................................. 45,000 1,417,500
LSI Logic Corp.*.......................................... 45,000 1,203,750
Maxxim Medical, Inc.*..................................... 65,000 812,500
Meridian Diagnostics, Inc................................. 70,000 910,000
Molex Inc., Cl A.......................................... 25,000 890,625
Symantec Corp.*........................................... 70,000 1,015,000
Teltrend, Inc.*........................................... 46,500 1,290,375
Teradyne, Inc.*........................................... 20,000 487,500
Thiokol Corp.............................................. 27,000 1,208,250
------------
22,476,812
------------
Utilities (3.2%)
Citizens Utilities Co. Cl A............................... 60,960 662,940
Nextel Communications, Inc.*.............................. 100,000 1,306,250
WorldCom, Inc.*........................................... 97,500 2,541,097
------------
4,510,287
------------
TOTAL COMMON STOCKS
(Cost: $117,440,944) 91.6%....................................... 129,917,690
------------
</TABLE>
- -------
* Non-income producing security.
<TABLE>
<CAPTION>
FACE
RATE MATURITY AMOUNT
---- -------- ----------
<S> <C> <C> <C> <C>
SHORT-TERM DEBT SECURITIES:
Commercial Paper (8.4%)
Allied Signal, Inc..................... 6.10% 01/02/97 $2,192,000 2,191,628
American Express Credit Corp. ......... 5.90 01/02/97 1,746,000 1,745,714
Merrill Lynch & Co. ................... 6.25 01/06/97 2,534,000 2,531,800
UBS Finance Del Inc. .................. 8.00 01/02/97 2,827,000 2,826,372
Warner Lambert Co. .................... 6.00 01/07/97 2,637,000 2,634,362
------------
11,929,876
------------
TOTAL SHORT-TERM DEBT SECURITIES
(Cost: $11,929,876) 8.4%........................................ 11,929,876
------------
TOTAL INVESTMENTS
(Cost: $129,370,820) 100.0%..................................... $141,847,566
============
</TABLE>
37
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (AGGRESSIVE EQUITY FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES
EXPIRATION EXERCISE SUBJECT
DATE PRICE TO CALL VALUE
---------- -------- ------- -----------
<S> <C> <C> <C> <C>
OPTIONS WRITTEN:
360 Communications Co. ............... 01/18/97 $25.00 10,000 $ (1,250)
American Radio Systems Corp. ......... 01/18/97 30.00 20,000 (7,500)
American Radio Systems Corp. ......... 01/18/97 25.00 5,000 (12,187)
Andrew Corp. ......................... 01/18/97 50.00 10,000 (41,250)
Andrew Corp. ......................... 04/19/97 50.00 5,000 (32,187)
Andrew Corp. ......................... 04/19/97 55.00 10,000 (41,250)
Andrew Corp. ......................... 01/18/97 45.00 20,000 (182,500)
Anixter International, Inc. .......... 01/18/97 15.00 5,000 (8,125)
Anixter International, Inc. .......... 07/19/97 17.50 3,000 (4,125)
Baker Hughes, Inc. ................... 04/19/97 37.50 5,000 (8,437)
Browning Ferris Inds., Inc. .......... 03/22/97 25.00 30,000 (67,500)
Danka Business Systems--ADR........... 05/17/97 35.00 10,000 (11,250)
Danka Business Systems--ADR........... 02/22/97 30.00 15,000 (91,875)
Danka Business Systems--ADR........... 02/22/97 35.00 15,000 (45,937)
Dentsply International, Inc. ......... 02/22/97 40.00 1,000 (7,812)
Dentsply International, Inc. ......... 05/17/97 50.00 3,000 (4,875)
DSC Communications Corp. ............. 01/18/97 15.00 10,000 (31,250)
DSC Communications Corp. ............. 01/18/97 12.50 10,000 (55,000)
DSC Communications Corp. ............. 04/19/97 17.50 10,000 (29,375)
DSC Communications Corp. ............. 04/19/97 20.00 30,000 (56,250)
DST Systems, Inc. .................... 02/22/97 35.00 3,500 (2,843)
DST Systems, Inc. .................... 01/18/97 35.00 25,000 (1,562)
DST Systems, Inc. .................... 01/18/97 30.00 5,000 (10,625)
DST Systems, Inc. .................... 02/22/97 30.00 3,000 (9,187)
ENSCO International, Inc. ............ 03/22/97 40.00 5,000 (48,125)
ENSCO International, Inc. ............ 03/22/97 45.00 5,000 (29,687)
Fleetwood Enterprises, Inc. .......... 02/22/97 35.00 14,000 (1,750)
General Instrument Corp. ............. 01/18/97 25.00 20,000 (2,500)
General Instrument Corp. ............. 03/22/97 25.00 5,000 (5,937)
General Instrument Corp. ............. 01/18/97 27.50 10,000 (1,250)
General Motors Corp. ................. 01/18/97 55.00 5,000 (8,125)
HealthCare COMPARE Corp. ............. 02/22/97 45.00 1,500 (2,109)
HealthCare COMPARE Corp. ............. 02/22/97 40.00 3,000 (11,812)
HNC Software.......................... 01/18/97 25.00 5,000 (33,125)
Interim Services, Inc. ............... 02/22/97 45.00 4,000 (750)
Interim Services, Inc. ............... 02/22/97 40.00 7,000 (1,312)
Interim Services, Inc. ............... 01/18/97 35.00 10,000 (11,875)
Intuit, Inc. ......................... 01/18/97 40.00 5,000 (1,250)
Intuit, Inc. ......................... 02/22/97 35.00 5,000 (8,750)
Intuit, Inc. ......................... 01/18/97 30.00 10,000 (30,000)
Intuit, Inc. ......................... 04/19/97 35.00 5,000 (14,375)
Intuit, Inc. ......................... 01/18/97 35.00 5,000 (3,750)
Intuit, Inc. ......................... 01/18/97 45.00 5,000 (937)
Liposome Company, Inc. ............... 01/18/97 17.50 5,000 (10,625)
Liposome Company, Inc. ............... 02/22/97 20.00 10,000 (15,625)
LSI Logic Corp. ...................... 04/19/97 30.00 5,000 (10,312)
LSI Logic Corp. ...................... 01/18/97 30.00 5,000 (1,875)
</TABLE>
38
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION (AGGRESSIVE EQUITY FUND)
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
SHARES
EXPIRATION EXERCISE SUBJECT
DATE PRICE TO CALL VALUE
---------- -------- ------- -----------
<S> <C> <C> <C> <C>
OPTIONS WRITTEN (CONT'D):
LSI Logic Corp. ....................... 01/18/97 $25.00 15,000 $ (39,375)
Molecular Dynamics, Inc. .............. 02/22/97 10.00 2,000 (3,375)
Mylan Laboratories, Inc. .............. 01/18/97 17.50 15,000 (3,750)
Nabors Industries, Inc. ............... 01/18/97 20.00 5,000 (3,906)
Nabors Industries, Inc. ............... 03/22/97 20.00 5,000 (6,250)
Nextel Communications, Inc. ........... 02/22/97 22.50 20,000 (1,250)
Oceaneering Int'l, Inc. ............... 01/18/97 17.50 10,000 (1,250)
Orthodontic Centers of America......... 03/22/97 17.50 10,000 (14,063)
Orthodontic Centers of America......... 03/22/97 20.00 10,000 (8,750)
Pall Corp. ............................ 03/22/97 25.00 10,000 (18,750)
Perkin-Elmer Corp. .................... 03/22/97 55.00 4,100 (22,550)
Pride Petroleum Svcs., Inc. ........... 01/18/97 17.50 5,000 (27,500)
Pride Petroleum Svcs., Inc. ........... 04/19/97 20.00 5,000 (19,687)
Scherer (R.P.) Corp. .................. 04/19/97 50.00 1,000 (2,875)
Scherer (R.P.) Corp. .................. 02/22/97 50.00 1,000 (2,125)
Scherer (R.P.) Corp. .................. 01/18/97 50.00 5,000 (8,594)
Scherer (R.P.) Corp. .................. 01/18/97 45.00 5,000 (27,812)
Silicon Valley Group, Inc. ............ 03/22/97 22.50 5,000 (5,469)
Silicon Valley Group, Inc. ............ 03/22/97 25.00 5,000 (2,500)
Smith International, Inc. ............. 01/18/97 35.00 10,000 (98,750)
Symantec Corp. ........................ 04/19/97 17.50 15,000 (16,875)
Teradyne, Inc. ........................ 07/19/97 25.00 5,000 (14,062)
Teradyne, Inc. ........................ 04/19/97 25.00 5,000 (11,250)
Thiokol Corp. ......................... 01/18/97 50.00 3,000 (187)
Thiokol Corp. ......................... 01/18/97 45.00 9,000 (9,562)
Transocean Offshore, Inc. ............. 02/22/97 65.00 2,500 (5,000)
USX-Marathon Group..................... 01/18/97 22.50 5,000 (8,125)
WorldCom, Inc. ........................ 01/18/97 25.00 10,000 (17,500)
WorldCom, Inc. ........................ 03/22/97 22.50 5,600 (24,500)
WorldCom, Inc. ........................ 01/18/97 22.50 66,900 (242,522)
WorldCom, Inc. ........................ 01/18/97 20.00 10,000 (60,000)
WorldCom, Inc. ........................ 03/22/97 25.00 5,000 (15,625)
-----------
TOTAL OPTIONS WRITTEN
(Premiums Received: $1,651,184)................................... $(1,763,797)
===========
</TABLE>
39
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
MONEY MARKET ALL AMERICA EQUITY INDEX BOND
FUND FUND FUND FUND
------------ ------------ ------------ -----------------
<S> <C> <C> <C> <C>
Assets:
Investments at market
value
(Cost:
Money Market Fund --
$77,780,114
All America Fund --
$428,665,730
Equity Index Fund --
$81,596,172
Bond Fund --
$320,240,056)
(Notes 1 and 3)........ $77,780,114 $634,437,558 $102,092,337 $323,507,447
Cash.................... 437 579,685 11,313 5,460
Interest and dividends
receivable............. -- 857,450 164,608 5,760,540
Receivable for
securities sold........ -- 2,081,449 19,161 --
Other Assets............ -- -- -- --
----------- ------------ ------------ ------------
Total Assets............ 77,780,551 637,956,142 102,287,419 329,273,447
Payable for securities
purchased.............. -- 1,286,793 278,004 --
Other liabilities....... -- -- 160,600 --
----------- ------------ ------------ ------------
Net Assets.............. $77,780,551 $636,669,349 $101,848,815 $329,273,447
=========== ============ ============ ============
Number of Shares
Outstanding (Note 4)... 65,361,651 261,306,452 63,857,347 238,393,054
=========== ============ ============ ============
Net Asset Values,
offering and redemption
price per share........ $1.19 $2.44 $1.59 $1.38
===== ===== ===== =====
<CAPTION>
SHORT-TERM MID-TERM COMPOSITE AGGRESSIVE EQUITY
BOND FUND BOND FUND FUND FUND
------------ ------------ ------------ -----------------
<S> <C> <C> <C> <C>
Assets:
Investments at market
value
(Cost:
Short-Term Bond Fund --
$15,307,684
Mid-Term Bond Fund --
$13,148,656
Composite Fund --
$260,928,454
Aggressive Equity
Fund -- $129,370,820)
(Notes 1 and 3)........ $15,364,035 $ 13,172,410 $282,565,309 $141,847,566
Cash.................... 26,423 491 132,855 274,313
Interest and dividends
receivable............. 115,784 186,619 2,090,350 40,300
Receivable for
securities sold........ 7,840 -- 2,007,015 54,085
Other assets............ -- -- -- --
----------- ------------ ------------ ------------
Total Assets............ 15,514,082 13,359,520 286,795,529 142,216,264
Payable for securities
purchased.............. -- -- 2,157,425 4,221,704
Call options written, at
market value
(Premium received:
Composite Fund --
$1,370,775
Aggressive Equity
Fund -- $1,651,184)... -- -- 1,706,995 1,763,797
Other liabilities....... -- -- -- 2,000
----------- ------------ ------------ ------------
Net Assets.............. $15,514,082 $ 13,359,520 $282,931,109 $136,228,763
=========== ============ ============ ============
Number of Shares
Outstanding (Note 4)... 15,099,233 14,897,709 159,862,322 92,534,946
=========== ============ ============ ============
Net Asset Values,
offering and redemption
price per share........ $1.03 $0.90 $1.77 $1.47
===== ===== ===== =====
</TABLE>
40
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
MONEY MARKET ALL AMERICA EQUITY INDEX BOND
FUND FUND FUND FUND
------------ -------------- -------------- -----------------
<S> <C> <C> <C> <C>
Investment Income and
Expenses:
Income:
Dividends.............. $ -- $ 9,749,497 $ 1,509,804 $ --
Interest............... 3,302,561 489,184 183,358 22,124,170
------------ -------------- -------------- --------------
Total income............ 3,302,561 10,238,681 1,693,162 22,124,170
------------ -------------- -------------- --------------
Expenses:
Investment advisory
fees (Note 2)......... 152,048 2,924,546 91,790 1,544,608
------------ -------------- -------------- --------------
Net Investment Income... 3,150,513 7,314,135 1,601,372 20,579,562
------------ -------------- -------------- --------------
Net Realized and
Unrealized Gain (Loss)
on Investments (Note
1):
Net realized gain (loss)
on investments:
Net proceeds from sales
and maturities........ 844,557,649 1,297,871,571 330,861,585 975,201,473
Cost of securities sold
or matured............ 844,557,810 1,275,861,587 329,058,521 970,205,458
------------ -------------- -------------- --------------
Net realized gain
(loss)................. (161) 22,009,984 1,803,064 4,996,015
Net unrealized
appreciation
(depreciation) of
investments............ -- 80,788,691 11,911,735 (14,451,071)
------------ -------------- -------------- --------------
Net Realized and
Unrealized Gain (Loss)
on Investments......... (161) 102,798,675 13,714,799 (9,455,056)
------------ -------------- -------------- --------------
Net Increase (Decrease)
in Net Assets Resulting
From Operations........ $ 3,150,352 $ 110,112,810 $ 15,316,171 $ 11,124,506
============ ============== ============== ==============
<CAPTION>
SHORT-TERM MID-TERM COMPOSITE AGGRESSIVE EQUITY
BOND FUND BOND FUND FUND FUND
------------ -------------- -------------- -----------------
<S> <C> <C> <C> <C>
Investment Income and
Expenses:
Income:
Dividends.............. $ -- $ -- $ 2,698,020 $ 651,191
Interest............... 674,218 2,048,239 8,905,871 625,763
------------ -------------- -------------- --------------
Total income............ 674,218 2,048,239 11,603,891 1,276,954
------------ -------------- -------------- --------------
Expenses:
Investment advisory
fees (Note 2)......... 56,971 163,102 1,412,746 835,441
------------ -------------- -------------- --------------
Net Investment Income... 617,247 1,885,137 10,191,145 441,513
------------ -------------- -------------- --------------
Net Realized and
Unrealized Gain (Loss)
on Investments (Note 1)
Net realized gain (loss)
on investments:
Net proceeds from sales
and maturities........ 133,203,028 255,460,802 1,270,846,583 1,031,261,624
Cost of securities sold
or matured............ 133,202,665 256,205,399 1,251,037,219 1,013,273,948
------------ -------------- -------------- --------------
Net realized gain
(loss)................. 363 (744,597) 19,809,364 17,987,676
Net unrealized
appreciation
(depreciation) of
investments............ 16,737 (776,280) 1,412,589 4,633,533
------------ -------------- -------------- --------------
Net Realized and
Unrealized Gain (Loss)
on Investments......... 17,100 (1,520,877) 21,221,953 22,621,209
------------ -------------- -------------- --------------
Net Increase (Decrease)
in Net Assets Resulting
from Operations........ $ 634,347 $ 364,260 $ 31,413,098 $ 23,062,722
============ ============== ============== ==============
</TABLE>
41
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
MONEY MARKET FUND ALL AMERICA FUND EQUITY INDEX FUND
--------------------------- -------------------------- --------------------------
1996 1995 1996 1995 1996 1995
------------ ------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
From Operations:
Net investment income.. $ 3,150,513 $ 4,789,858 $ 7,314,135 $ 7,083,036 $ 1,601,372 $ 742,324
Net realized gain
(loss) on investments. (161) (855) 22,009,984 14,798,885 1,803,064 830,703
Unrealized appreciation
(depreciation) of
investments........... -- -- 80,788,691 113,581,011 11,911,735 8,117,495
------------ ------------- ------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets Resulting
From Operations........ 3,150,352 4,789,003 110,112,810 135,462,932 15,316,171 9,690,522
------------ ------------- ------------ ------------ ------------ ------------
Capital Share
Transactions (Note 4):
Net proceeds from sale
of shares............. 61,070,949 92,909,943 67,857,705 85,691,993 60,056,284 27,580,190
Dividends reinvested... 3,165,422 4,789,411 32,301,582 16,966,116 3,473,499 1,434,797
Cost of shares
redeemed.............. (59,846,394) (105,660,794) (74,455,531) (63,029,352) (16,336,002) (20,510,835)
Dividend distributions. (3,165,422) (4,789,411) (32,301,582) (16,966,116) (3,473,499) (1,434,797)
------------ ------------- ------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets From
Capital Share
Transactions........... 1,224,555 (12,750,851) (6,597,826) 22,662,641 43,720,282 7,069,355
------------ ------------- ------------ ------------ ------------ ------------
Increase (Decrease) in
Net Assets............. 4,374,907 (7,961,848) 103,514,984 158,125,573 59,036,453 16,759,877
Net Assets, Beginning of
Year................... 73,405,644 81,367,492 533,154,365 375,028,792 42,812,362 26,052,485
------------ ------------- ------------ ------------ ------------ ------------
Net Assets, End of Year. $ 77,780,551 $ 73,405,644 $636,669,349 $533,154,365 $101,848,815 $ 42,812,362
============ ============= ============ ============ ============ ============
Components of Net
Assets:
Paid-in capital........ $ 77,697,824 $ 73,307,847 $434,648,029 $408,944,273 $ 81,348,585 $ 34,154,804
Accumulated
undistributed net
investment income
(loss)................ 87,923 102,832 (244,122) (191,138) (8,055) (16,607)
Accumulated
undistributed net
realized gain (loss)
on investments........ (5,196) (5,035) (3,506,387) (581,908) 12,120 89,735
Unrealized appreciation
(depreciation) of
investments........... -- -- 205,771,829 124,983,138 20,496,165 8,584,430
------------ ------------- ------------ ------------ ------------ ------------
Net Assets, End of Year. $ 77,780,551 $ 73,405,644 $636,669,349 $533,154,365 $101,848,815 $ 42,812,362
============ ============= ============ ============ ============ ============
<CAPTION>
SHORT-TERM MID-TERM
BOND FUND BOND FUND BOND FUND
--------------------------- -------------------------- --------------------------
1996 1995 1996 1995 1996 1995
------------ ------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
From Operations:
Net investment income.. $ 20,579,562 $ 18,505,394 $ 617,247 $ 135,016 $ 1,885,137 $ 1,428,809
Net realized gain
(loss) on investments. 4,996,015 (4,189,297) 363 71 (744,597) (550,761)
Unrealized appreciation
(depreciation) of
investments........... (14,451,071) 34,607,512 16,737 80,884 (776,280) 2,852,665
------------ ------------- ------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets Resulting
From Operations........ 11,124,506 48,923,609 634,347 215,971 364,260 3,730,713
------------ ------------- ------------ ------------ ------------ ------------
Capital Share
Transactions (Note 4):
Net proceeds from sale
of shares............. 63,334,172 49,650,330 14,156,603 2,094,144 33,969,164 5,036,179
Dividends reinvested... 21,664,408 18,492,800 606,778 138,417 1,825,609 1,429,433
Cost of shares
redeemed.............. (56,464,268) (35,948,084) (1,789,353) (2,224,502) (45,471,861) (7,997,355)
Dividend distributions. (21,664,408) (18,492,800) (606,778) (138,417) (1,825,609) (1,429,433)
------------ ------------- ------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets From
Capital Share
Transactions........... 6,869,904 13,702,246 12,367,250 (130,358) (11,502,697) (2,961,176)
------------ ------------- ------------ ------------ ------------ ------------
Increase (Decrease) in
Net Assets............. 17,994,410 62,625,855 13,001,597 85,613 (11,138,437) 769,537
Net Assets, Beginning of
Year................... 311,279,037 248,653,182 2,512,485 2,426,872 24,497,957 23,728,420
------------ ------------- ------------ ------------ ------------ ------------
Net Assets, End of Year. $329,273,447 $ 311,279,037 $ 15,514,082 $ 2,512,485 $ 13,359,520 $ 24,497,957
============ ============= ============ ============ ============ ============
Components of Net
Assets:
Paid-in capital........ $330,508,029 $ 301,973,717 $ 15,463,173 $ 2,489,145 $ 14,621,441 $ 24,298,529
Accumulated
undistributed net
investment income
(loss)................ (1,022,752) (701,307) 4,971 (5,498) 12,288 (47,240)
Accumulated
undistributed net
realized gain (loss)
on investments........ (3,479,221) (7,711,835) (10,413) (10,776) (1,297,963) (553,366)
Net unrealized
appreciation
(depreciation) of
investments........... 3,267,391 17,718,462 56,351 39,614 23,754 800,034
------------ ------------- ------------ ------------ ------------ ------------
Net Assets, End of Year. $329,273,447 $ 311,279,037 $ 15,514,082 $ 2,512,485 $ 13,359,520 $ 24,497,957
============ ============= ============ ============ ============ ============
</TABLE>
42
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
The accompanying notes are an integral part of these financial statements.
<TABLE>
<CAPTION>
COMPOSITE FUND AGGRESSIVE EQUITY FUND
-------------------------- --------------------------
1996 1995 1996 1995
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Increase (Decrease) In
Net Assets:
From Operations:
Net investment income. $ 10,191,145 $ 10,961,347 $ 441,513 $ 259,615
Net realized gain
(loss) on
investments.......... 19,809,364 8,223,933 17,987,676 6,123,997
Unrealized
appreciation
(depreciation) of
investments.......... 1,412,589 31,059,449 4,633,533 6,213,711
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets Resulting
From Operations........ 31,413,098 50,244,729 23,062,722 12,597,323
------------ ------------ ------------ ------------
Capital Share
Transactions (Note 4):
Net proceeds from sale
of shares............ 15,736,097 15,416,148 72,571,512 30,668,870
Dividends reinvested.. 35,621,387 15,284,744 19,399,095 4,116,301
Cost of shares
redeemed............. (40,509,708) (21,907,582) (18,033,044) (11,200,912)
Dividend
distributions........ (35,621,387) (15,284,744) (19,399,095) (4,116,301)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets From
Capital Share
Transactions........... (24,773,611) (6,491,434) 54,538,468 19,467,958
------------ ------------ ------------ ------------
Increase (Decrease) in
Net Assets............. 6,639,487 43,753,295 77,601,190 32,065,281
Net Assets, Beginning of
Year................... 276,291,622 232,538,327 58,627,573 26,562,292
------------ ------------ ------------ ------------
Net Assets, End of Year. $282,931,109 $276,291,622 $136,228,763 $ 58,627,573
============ ============ ============ ============
Components of Net
Assets:
Paid-in capital....... $263,241,421 $252,393,645 $122,803,147 $ 48,865,584
Accumulated
undistributed net
investment income
(loss)............... 499,542 1,177,730 (16,273) (6,192)
Accumulated
undistributed net
realized gain (loss)
on investments....... (2,110,489) 2,832,201 1,077,756 2,037,581
Unrealized
appreciation
(depreciation) of
investments.......... 21,300,635 19,888,046 12,364,133 7,730,600
------------ ------------ ------------ ------------
Net Assets, End of Year. $282,931,109 $276,291,622 $136,228,763 $ 58,627,573
============ ============ ============ ============
</TABLE>
43
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
FINANCIAL HIGHLIGHTS
Income from investment operations and distributions per share for a Fund
share outstanding throughout each of the ten years ended December 31, 1996,
or, since the Fund's inception date if in existence less than ten years and
other supplementary data with respect to the Funds are presented below. The
financial highlights for the years 1987 through 1991 are presented from the
perspective of the Separate Accounts, which are the ultimate holders of the
shares of the Investment Company. Effective in 1992 the financial highlights
are presented from the perspective of the Funds.
<TABLE>
<CAPTION>
MONEY MARKET FUND
------------------------------------------------------------------------------
YEARS ENDED DECEMBER 31,
------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Year...... $ 1.18 $ 1.19 $ 1.17 $ 1.17 $ 1.18 $ 1.23 $ 1.23 $ 1.22 $ 1.25 $ 1.18
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Income From Investment
Operations:
Net Investment Income.. 0.06 0.07 0.03 0.04 0.04 0.12 0.10 0.12 0.08 0.07
Net Gains or (Losses)
on Securities realized
and unrealized........ -- -- 0.02 -- -- (0.05) -- -- -- --
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total From Investment
Operations............. 0.06 0.07 0.05 0.04 0.04 0.07 0.10 0.12 0.08 0.07
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Less: Dividend
Distributions From Net
Investment Income...... (0.05) (0.08) (0.03) (0.04) (0.05) (0.12) (0.10) (0.11) (0.11) --
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total Distributions..... (0.05) (0.08) (0.03) (0.04) (0.05) (0.12) (0.10) (0.11) (0.11) --
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net Asset Value, End of
Year................... $ 1.19 $ 1.18 $ 1.19 $ 1.17 $ 1.17 $ 1.18 $ 1.23 $ 1.23 $ 1.22 $ 1.25
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return (%)........ 5.3 5.8 4.1 2.9 3.3 4.4 6.8 7.8 5.9 5.7
Net Assets, End of Year
($ millions)........... 78 73 81 38 39 43 89 81 6 3
Ratio of Expenses to
Average Net
Assets (%)............. 0.25 0.25 0.25 0.26 0.40 0.40 0.40 0.40 0.40 0.40
Ratio of Net Income to
Average Net Assets (%). 5.21 5.66 4.15 2.90 3.33 5.73 7.79 8.90 6.85 5.99
Portfolio Turnover
Rate(a)................ N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
</TABLE>
- -------
(a) Portfolio turnover rate excludes all U.S. Government and short-term
securities.
44
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
ALL AMERICA FUND (B)
------------------------------------------------------------------------------
YEARS ENDED DECEMBER 31,
------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Year...... $ 2.13 $ 1.61 $ 1.80 $ 1.79 $ 1.93 $ 1.70 $ 1.81 $ 1.69 $ 1.82 $ 1.67
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Income From Investment
Operations:
Net Investment Income.. 0.03 0.03 0.04 0.04 0.04 0.18 0.08 0.28 0.06 0.02
Net Gains or (Losses)
on Securities
realized and
unrealized............ 0.41 0.56 (0.01) 0.18 0.03 0.23 (0.11) 0.14 0.10 0.13
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total From Investment
Operations............. 0.44 0.59 0.03 0.22 0.07 0.41 (0.03) 0.42 0.16 0.15
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Less Dividend
Distributions:
From Net Investment
Income................ (0.03) (0.03) (0.04) (0.04) (0.04) (0.05) (0.06) (0.05) (0.09) --
From Capital Gains..... (0.10) (0.04) (0.18) (0.17) (0.17) (0.13) (0.02) (0.25) (0.20) --
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total Distributions..... (0.13) (0.07) (0.22) (0.21) (0.21) (0.18) (0.08) (0.30) (0.29) --
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net Asset Value, End of
Year................... $ 2.44 $ 2.13 $ 1.61 $ 1.80 $ 1.79 $ 1.93 $ 1.70 $ 1.81 $ 1.69 $ 1.82
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return (%)........ 20.7 36.6 (d)3.7 12.0 3.2 22.6 (3.8) 24.1 8.7 8.3
Net Assets, End of Year
($ millions)........... 637 533 375 424 398 434 377 437 40 43
Ratio of Expenses to
Average Net
Assets (%)............. 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50
Ratio of Net Income to
Average Net
Assets (%)............. 1.26 1.57 2.11 1.92 2.02 2.49 3.33 2.54 3.07 1.97
Portfolio Turnover Rate
(%)(a)................. 28.35 33.63 129.80 93.86 129.40 158.35 108.75 117.60 56.94 150.74
Average Commission Rate
Paid ($)(e)............ .0549 -- -- -- -- -- -- -- -- --
</TABLE>
- -------
(a)Portfolio turnover rate excludes all U.S. Government and short-term
securities.
(b)Prior to May 2, 1994, this Fund was known as the Stock Fund and had a
different investment objective.
(c)Reflects the combined data of this Fund and that of its predecessor.
(d)Total return reflects performance from May 2, 1994 and is not annualized.
(e)Average commission rate paid per share of stock is calculated for years
beginning after 1995.
45
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
BOND FUND
------------------------------------------------------------------------------
YEARS ENDED DECEMBER 31,
------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Year...... $ 1.43 $ 1.27 $ 1.41 $ 1.41 $ 1.41 $ 1.33 $ 1.37 $ 1.27 $ 1.40 $ 1.42
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Income From Investment
Operations:
Net Investment Income.. 0.09 0.09 0.09 0.09 0.09 0.13 0.09 -- 0.09 0.07
Net Gains or (Losses)
on Securities
realized and
unrealized............ (0.04) 0.16 (0.14) 0.09 0.03 0.08 (0.02) 0.16 (0.01) (0.09)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total From Investment
Operations............ 0.05 0.25 (0.05) 0.18 0.12 0.21 0.07 0.16 0.08 (0.02)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Less Dividend
Distributions:
From Net Investment
Income................ (0.09) (0.09) (0.09) (0.09) (0.09) (0.11) (0.11) (0.06) (0.21) --
From Capital Gains..... (0.01) -- -- (0.09) (0.03) (0.02) -- -- -- --
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total Distributions.... (0.10) (0.09) (0.09) (0.18) (0.12) (0.13) (0.11) (0.06) (0.21) --
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net Asset Value, End of
Year................... $ 1.38 $ 1.43 $ 1.27 $ 1.41 $ 1.41 $ 1.41 $ 1.33 $ 1.37 $ 1.27 $ 1.40
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return (%)........ 3.5 19.4 (3.2) 13.1 8.6 14.0 3.5 11.1 6.2 (1.9)
Net Assets, End of Year
($ millions)........... 329 311 249 263 233 187 163 109 5 4
Ratio of Expenses to
Average Net Assets (%). 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50
Ratio of Net Income to
Average Net Assets (%). 6.70 6.64 6.32 6.30 6.93 7.59 8.57 8.55 8.25 7.97
Portfolio Turnover Rate
(%)(a)................. 30.14 41.93 51.14 103.16 112.40 95.00 129.02 47.70 75.61 47.41
</TABLE>
- -------
(a) Portfolio turnover rate excludes all U.S. Government and short-term
securities.
46
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
SHORT-TERM BOND FUND MID-TERM BOND FUND
---------------------------- -----------------------------
YEARS ENDED DECEMBER 31, YEARS ENDED DECEMBER 31,
---------------------------- -----------------------------
1996 1995 1994 1993(B) 1996 1995 1994 1993(B)
----- ----- ----- ------- ------ ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Year...... $1.02 $1.00 $1.02 $ 1.00 $ 1.00 $0.91 $0.99 $ 1.00
----- ----- ----- ------ ------ ----- ----- ------
Income From Investment
Operations:
Net Investment Income.. 0.04 0.06 0.04 0.02 0.14 0.06 0.03 0.04
Net Gains or (Losses)
on Securities realized
and unrealized........ 0.01 0.02 (0.02) 0.02 (0.10) 0.09 (0.07) 0.04
----- ----- ----- ------ ------ ----- ----- ------
Total From Investment
Operations............ 0.05 0.08 0.02 0.04 0.04 0.15 (0.04) 0.08
----- ----- ----- ------ ------ ----- ----- ------
Less Dividend
Distributions:
From Net Investment
Income................ (0.04) (0.06) (0.04) (0.02) (0.14) (0.06) (0.04) (0.04)
From Capital Gains..... -- -- -- -- -- -- -- (0.05)
----- ----- ----- ------ ------ ----- ----- ------
Total Distributions.... (0.04) (0.06) (0.04) (0.02) (0.14) (0.06) (0.04) (0.09)
----- ----- ----- ------ ------ ----- ----- ------
Net Asset Value, End of
Year................... $1.03 $1.02 $1.00 $ 1.02 $ 0.90 $1.00 $0.91 $ 0.99
===== ===== ===== ====== ====== ===== ===== ======
Total Return (%)........ 4.9 7.7 1.4 4.6 3.9 16.3 (3.7) 7.3
Net Assets, End of Year
($ millions)........... 16 3 2 3 13 24 24 19
Ratio of Expenses to
Average Net Assets (%). 0.50 0.50 0.48 0.45 0.50 0.50 0.50 0.45
Ratio of Net Income to
Average Net Assets (%). 5.42 4.65 3.51 3.09 5.80 5.73 4.71 4.13
Portfolio Turnover Rate
(%)(a)................. 6.68 16.47 0.00 122.37 144.55 73.72 7.52 162.03
</TABLE>
- -------
(a)Portfolio turnover rate excludes all U.S. Government and short-term
securities.
(b)Commenced operations February 5, 1993; total return and other ratios have
not been annualized.
47
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
COMPOSITE FUND
YEARS ENDED DECEMBER 31,
------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Begin-
ning of Year........... $ 1.81 $ 1.57 $ 1.71 $ 1.59 $ 1.61 $ 1.53 $ 1.63 $ 1.46 $ 1.60 $ 1.51
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Income From Investment
Operations:
Net Investment Income.. 0.07 0.08 0.05 0.05 0.06 0.19 0.14 0.11 0.08 0.05
Net Gains or (Losses)
on Securities realized
and unrealized........ 0.14 0.27 (0.10) 0.22 0.03 0.09 (0.09) 0.17 0.05 0.04
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total From Investment
Operations............. 0.21 0.35 (0.05) 0.27 0.09 0.28 0.05 0.28 0.13 0.09
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Less Dividend Distribu-
tions:
From Net Investment In-
come.................. (0.08) (0.08) (0.07) (0.05) (0.06) (0.07) (0.10) (0.08) (0.17) --
From Capital Gains..... (0.17) (0.03) (0.02) (0.10) (0.05) (0.13) (0.05) (0.03) (0.10) --
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total Distributions..... (0.25) (0.11) (0.09) (0.15) (0.11) (0.20) (0.15) (0.11) (0.27) --
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net Asset Value, End of
Year................... $ 1.77 $ 1.81 $ 1.57 $ 1.71 $ 1.59 $ 1.61 $ 1.53 $ 1.63 $ 1.46 $ 1.60
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return (%)........ 11.9 21.9 (3.0) 16.9 5.9 16.4 1.5 17.2 7.9 5.2
Net Assets, End of Year
($ millions)........... 283 276 233 228 138 111 79 67 51 45
Ratio of Expenses to Av-
erage Net Assets (%)... 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50
Ratio of Net Income to
Average Net Assets (%). 3.63 4.30 3.88 3.48 4.01 4.75 6.20 5.48 5.94 5.10
Portfolio Turnover Rate
(%)(a)................. 69.79 76.84 113.86 100.76 107.69 134.91 105.06 87.32 50.88 124.04
Average Commission Rate
Paid($)(b)............. .0597 -- -- -- -- -- -- -- -- --
</TABLE>
- -------
(a) Portfolio turnover rate excludes all U.S. Government and short-term
securities.
(b) Average commission rate paid per share of stock is calculated for years
beginning after 1995.
48
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
AGGRESSIVE
EQUITY INDEX FUND EQUITY FUND
------------------------------- -----------------------
YEARS ENDED YEARS ENDED
DECEMBER 31, DECEMBER 31,
------------------------------- -----------------------
1996 1995 1994 1993(B) 1996 1995 1994(C)
------ ------ ------ ------- ------ ------ -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Begin-
ning of Year........... $ 1.35 $ 1.02 $ 1.04 $ 1.00 $ 1.35 $ 1.05 $ 1.00
------ ------ ------ ------ ------ ------ ------
Income From Investment
Operations:
Net Investment Income.. 0.03 0.02 0.03 0.02 0.01 0.01 0.01
Net Gains or (Losses)
on Securities realized
and unrealized........ 0.27 0.36 (0.01) 0.04 0.36 0.39 0.05
------ ------ ------ ------ ------ ------ ------
Total From Investment
Operations............. 0.30 0.38 0.02 0.06 0.37 0.40 0.06
------ ------ ------ ------ ------ ------ ------
Less Dividend Distribu-
tions:
From Net Investment In-
come.................. (0.03) (0.03) (0.03) (0.02) (0.01) (0.01) (0.01)
From Capital Gains..... (0.03) (0.02) (0.01) -- (0.24) (0.09) --
------ ------ ------ ------ ------ ------ ------
Total Distributions..... (0.06) (0.05) (0.04) (0.02) (0.25) (0.10) (0.01)
------ ------ ------ ------ ------ ------ ------ ---
Net Asset Value, End of
Year................... $ 1.59 $ 1.35 $ 1.02 $ 1.04 $ 1.47 $ 1.35 $ 1.05
====== ====== ====== ====== ====== ====== ======
Total Return (%)........ 22.7 36.6 1.5 6.2 27.1 38.2 6.0
Net Assets, End of Year
($ millions)........... 102 43 26 27 136 59 27
Ratio of Expenses to Av-
erage Net
Assets (%)............. 0.13 0.13 0.13 0.11 0.85 0.85 0.56
Ratio of Net Income to
Average Net
Assets (%)............. 2.19 2.50 2.67 2.43 0.45 0.65 0.70
Portfolio Turnover Rate
(%)(a)................. 5.85 13.99 6.59 1.44 103.68 116.52 60.86
Average Commission Rates
Paid($)(d)............. .0388 -- -- -- .0591 -- --
</TABLE>
- -------
(a)Portfolio turnover rate excludes all U.S. Government and short-term
securities.
(b)Commenced operations February 5, 1993; total return and other ratios have
not been annualized.
(c)Commenced operations May 2, 1994; total return and other ratios have not
been annualized
(d)Average commission rate paid per share of stock is calculated for years
beginning after 1995.
49
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION
Mutual of America Investment Corporation (the "Investment Company") is a
diversified, open-end management investment company -- a type of company
commonly known as a "mutual fund". It is registered as such under the
Investment Company Act of 1940 (the "Investment Company Act"). The Investment
Company was formed on February 21, 1986 as a Maryland corporation and offers
its shares exclusively to separate accounts of Mutual of America Life
Insurance Company ("Mutual of America Life") and Mutual of America Life's
indirect wholly-owned subsidiary, The American Life Insurance Company of New
York ("American Life"). As a "series" type mutual fund, the Investment Company
issues separate classes (or series) of capital stock, each of which represents
a separate Fund of investments. There are currently eight Funds: the Money
Market Fund, the All America Fund, the Equity Index Fund, the Bond Fund, the
Short-Term Bond Fund, the Mid-Term Bond Fund, the Composite Fund, and the
Aggressive Equity Fund. The Investment Company is a successor to Mutual of
America Life's Separate Account No. 2 Money Market, All America (formerly
stock) Bond and Composite Funds having exchanged its shares for the respective
net assets of these Separate Account No. 2 Funds in 1986.
The Investment Company shares are sold only to Mutual of America Life and
American Life for allocation to their Separate Accounts as a funding medium
for variable annuity and variable life insurance contracts issued by these
companies. As of December 31, 1996 Mutual of America Life owned 98.4% and
American Life 1.6% of the Investment Company's aggregate outstanding shares.
In January 1989, the net assets of Mutual of America Life's Separate Account
No. 1, available only for qualified pension plans, were invested in the All
America Fund of the Investment Company. Pursuant to this transaction,
approximately 249 million shares of the All America Fund were issued.
Effective February 5, 1993, the Equity Index Fund, Short-Term Bond Fund and
the Mid-Term Bond Fund commenced operations. On May 2, 1994 the Mutual of
America Aggressive Equity Fund commenced operations and the Stock Fund was
renamed the All America Fund with different investment objectives.
The following is a summary of the significant accounting policies of the
Investment Company:
Security Valuation -- Investment securities are valued as follows:
Stocks listed on national security exchanges and certain over-the-counter
issues quoted on the National Association of Securities Dealers
Automated Quotation ("NASDAQ") system are valued at the last sale price,
or if no sale, at the latest available bid price.
Debt securities are valued at a composite fair market value "evaluated
bid," which may be the last sale price. Securities for which market
quotations are not readily available will be valued at fair value as
determined in good faith by the Investment Adviser under the direction
of the Board of Directors of the Investment Company.
Short-term investments with a maturity of 60 days or less are valued at
amortized cost, which approximates market value. Short-term debt
securities, which mature in more than 60 days, are stated at market
value.
Premiums received by the Investment Company upon writing covered call
options are included in the Investment Company's statement of assets and
liabilities as an asset and an equivalent liability. The liability is
adjusted daily to reflect the market value of the options written based
on the latest sale or closing price. If an option expires, or if the
Investment Company enters into a closing purchase transaction, the
Investment Company realizes a gain or, if the cost of a closing purchase
transaction exceeds the premium originally received, a loss, and the
liability related to the option is extinguished. If an option is
exercised, the proceeds of the sale of the underlying security are
increased by the premium originally received when the option was
written.
The Fund may purchase stock index futures contracts for cash management
purposes to remain more fully invested in the equity markets while
minimizing transaction costs. Initial cash margin deposits (represented
by cash or Treasury bills) are made upon entering into futures
contracts. (This initial margin, equal to approximately 3% of the
contract amount, does not involve the borrowing of funds to finance the
transaction). During the period the futures contract is outstanding,
changes in the value of the contract are recognized as unrealized gains
or losses from futures transactions by "marking-to-market" on a daily
basis to reflect the market value of the contract at
50
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
the end of each trading day. Depending upon whether unrealized gains or
losses are incurred, variation margin payments are received or made.
When the contract is closed, a realized gain or loss from futures
transactions is recorded, equal to the net variation margin received or
paid over the period of the contract. The "Underlying Face Amount at
Value" representing the aggregate of outstanding contractual amounts
under futures contracts reflects the extent of a Fund's exposure to off-
balance sheet risk.
Security Transactions -- Security transactions are recorded on the trade
date. Interest income is accrued as earned. Dividend income is recorded
on the ex-dividend date. Foreign source tax withheld from dividends is
recorded as a reduction from dividend income. Should reclamation efforts
succeed, such amounts are recorded as income upon collection.
Realized gains and losses on the sale of short and long-term debt
securities are computed on the basis of amortized cost at the time of
sale. Realized gains and losses on the sale of stock is based on the
identified cost basis of the security, determined on the first-in,
first-out ("FIFO") basis.
Federal Income Taxes -- The Investment Company intends to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its taxable
income to shareholders. Therefore, no federal income tax provision is
required.
2. EXPENSES
The Investment Company has entered into an Investment Advisory Agreement
with Mutual of America Capital Management Corporation ("the Adviser"), an
indirect wholly-owned subsidiary of Mutual of America Life. For providing
investment management services to each of the Funds of the Investment Company,
the Adviser receives a fee calculated as a daily charge at the annual rate of
.25% of the value of the net assets of the Money Market Fund, and .50% of the
value of the net assets of the All America Fund, Bond Fund, Short-Term Bond
Fund, Mid-Term Bond Fund and Composite Fund, .125% of the value of the net
assets of the Equity Index Fund, and .85% of the value of the net assets of
the Aggressive Equity Fund.
Under Subadvisory Agreements, the Adviser has delegated its investment
advisory responsibilities to such subadvisers, is responsible for providing
management services to the respective Funds and pays the subadvisors for their
investment advisory services.
The Adviser voluntarily limits the expenses of each Fund, other than for
brokers' commissions, transfer taxes and other fees relating to portfolio
transactions, to the amount of the advisory fee paid by the Funds of the
Investment Company to the Adviser. The Adviser may discontinue this practice
at any time.
Various funds of the Investment Company placed portfolio transactions
through a broker affiliated with the Adviser. The aggregate commissions paid
to this broker for the year ended December 31, 1996 was $100,812 or 8% of
total commissions. In addition, a Sub-Advisor of the Fund placed a portion of
its portfolio transactions with its affiliated broker-dealer. Such commissions
amounted to $72,555 or 6% of the Fund's total commissions.
3. PURCHASES AND SALES
The cost of investment purchases and proceeds from sales of investments,
excluding short-term and U.S. government securities and options for the year
ended December 31, 1996 was as follows:
<TABLE>
<CAPTION>
ALL AMERICA EQUITY INDEX BOND
FUND FUND FUND
------------ ------------ ------------
<S> <C> <C> <C>
Cost of investment purchases............. $165,399,892 $43,822,269 $128,872,632
============ =========== ============
Proceeds from sales of investments....... $161,921,056 $ 4,021,745 $ 86,480,196
============ =========== ============
</TABLE>
<TABLE>
<CAPTION>
SHORT-TERM MID-TERM COMPOSITE AGGRESSIVE
BOND FUND BOND FUND FUND EQUITY FUND
----------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
Cost of investment purchases. $14,850,769 $39,050,621 $177,611,178 $144,504,219
=========== =========== ============ ============
Proceeds from sales of
investments................. $ 496,836 $51,055,413 $202,429,168 $ 92,598,928
=========== =========== ============ ============
</TABLE>
51
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The cost of short-term security purchases for the Money Market Fund for the
year was $845,662,839. Net proceeds from sales and redemptions for the year
was $844,557,649.
At December 31, 1996, net unrealized appreciation (depreciation) of
investments, based on cost for Federal income tax purposes, was as follows:
<TABLE>
<CAPTION>
MONEY ALL AMERICA EQUITY INDEX BOND
MARKET FUND FUND FUND FUND
----------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Aggregate gross unrealized
appreciation............... $ -- $216,575,557 $ 21,903,625 $ 5,830,239
Aggregate gross unrealized
depreciation............... -- 10,803,728 1,407,460 2,562,848
----------- ------------ ------------ ------------
Net unrealized appreciation
(depreciation)............. $ -- $205,771,829 $ 20,496,165 $ 3,267,391
=========== ============ ============ ============
Aggregate cost of invest-
ments for Federal income
tax
purposes................... $77,780,114 $428,665,730 $ 81,596,172 $320,240,056
=========== ============ ============ ============
<CAPTION>
SHORT-TERM MID-TERM COMPOSITE AGGRESSIVE
BOND FUND BOND FUND FUND EQUITY FUND
----------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Aggregate gross unrealized
appreciation............... $ 70,276 $ 91,465 $ 30,289,722 $ 19,978,253
Aggregate gross unrealized
depreciation............... 13,925 67,711 8,989,087 7,614,120
----------- ------------ ------------ ------------
Net unrealized appreciation
(depreciation)............. $ 56,351 $ 23,754 $ 21,300,635 $ 12,364,133
=========== ============ ============ ============
Aggregate cost of
investments for Federal
income tax
purposes................... $15,307,684 $ 13,148,656 $260,928,454 $129,370,820
=========== ============ ============ ============
</TABLE>
4. CAPITAL SHARE ACTIVITY
At December 31, 1996 there were 3 billion shares of $.01 par value capital
stock authorized for the Investment Company. The shares are allocated into the
eight series of funds as follows:
<TABLE>
<CAPTION>
NAME OF FUND AUTHORIZED NO. OF SHARES
------------ ------------------------
<S> <C>
Money Market Fund..................................... 100,000,000
All America Fund...................................... 500,000,000
Equity Index Fund..................................... 75,000,000
Bond Fund............................................. 250,000,000
Short-Term Bond Fund.................................. 50,000,000
Mid-Term Bond Fund.................................... 75,000,000
Composite Fund........................................ 200,000,000
Aggressive Equity Fund................................ 500,000,000
-------------
Sub Total........................................... 1,750,000,000
Shares to be allocated at the discretion of the Board
of Directors......................................... 1,250,000,000
-------------
Total............................................... 3,000,000,000
=============
</TABLE>
Transactions in shares were as follows:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1996
------------------------------------------------
MONEY MARKET ALL AMERICA EQUITY INDEX BOND
FUND FUND FUND FUND
------------ ----------- ------------ ----------
<S> <C> <C> <C> <C>
Shares sold................... 50,280,297 29,550,325 40,909,613 44,395,084
Shares issued to shareholders
as reinvestment of dividends. 2,659,830 13,283,731 2,182,072 15,684,625
---------- ---------- ---------- ----------
Total ........................ 52,940,127 42,834,056 43,091,685 60,079,709
Shares redeemed............... 49,911,080 32,314,890 11,049,137 39,572,610
---------- ---------- ---------- ----------
Net increase (decrease)....... 3,029,047 10,519,166 32,042,548 20,507,099
========== ========== ========== ==========
</TABLE>
52
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1996
---------------------------------------------------
SHORT-TERM MID-TERM COMPOSITE AGGRESSIVE EQUITY
BOND FUND BOND FUND FUND FUND
---------- ---------- ---------- -----------------
<S> <C> <C> <C> <C>
Shares sold................ 13,761,891 33,684,710 8,501,017 47,625,065
Shares issued to sharehold-
ers as reinvestment of
dividends................. 590,553 2,035,806 20,004,080 13,092,538
---------- ---------- ---------- ----------
Total...................... 14,352,444 35,720,516 28,505,097 60,717,603
Shares redeemed............ 1,718,816 45,316,254 21,578,442 11,562,121
---------- ---------- ---------- ----------
Net increase (decrease).... 12,633,628 (9,595,738) 6,926,655 49,155,482
========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1995
------------------------------------------------
MONEY MARKET ALL AMERICA EQUITY INDEX BOND
FUND FUND FUND FUND
------------ ----------- ------------ ----------
<S> <C> <C> <C> <C>
Shares sold................... 75,724,884 42,681,882 22,823,514 35,264,481
Shares issued to shareholders
as reinvestment of dividends. 4,066,652 7,980,558 1,066,201 12,944,402
---------- ---------- ---------- ----------
Total......................... 79,791,536 50,662,440 23,889,715 48,208,883
Shares redeemed............... 85,788,635 33,103,404 17,637,595 25,740,959
---------- ---------- ---------- ----------
Net increase (decrease)....... (5,997,099) 17,559,036 6,252,120 22,467,924
========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1995
---------------------------------------------------
SHORT-TERM MID-TERM COMPOSITE AGGRESSIVE EQUITY
BOND FUND BOND FUND FUND FUND
---------- ---------- ---------- -----------------
<S> <C> <C> <C> <C>
Shares sold................ 2,015,656 5,042,701 8,968,895 23,932,340
Shares issued to sharehold-
ers as reinvestment of
dividends................. 135,836 1,429,171 8,460,475 3,045,773
--------- ---------- ---------- ----------
Total...................... 2,151,492 6,471,872 17,429,370 26,978,113
Shares redeemed............ 2,112,272 7,961,340 12,516,767 8,844,832
--------- ---------- ---------- ----------
Net increase (decrease).... 39,220 (1,489,468) 4,912,603 18,133,281
========= ========== ========== ==========
</TABLE>
5. DIVIDENDS
On December 31, 1996 dividend distributions were declared for each of the
Funds from net realized gains on investment transactions and net investment
income during 1996. Additionally, on September 16, 1996 the remaining required
dividends relating to the 1995 Internal Revenue Sec. 885(A) election were
declared for each of the Funds, which were reinvested resulting in an increase
in the aggregate shares outstanding. Dividends declared on September 16, 1996
were paid on September 16, 1996 to shareholders of record on September 15,
1996, and dividends declared on December 31, 1996 were paid on December 31,
1996 to shareholders of record on December 30, 1996. All dividend
distributions are immediately reinvested in additional shares of each
respective Fund.
<TABLE>
<CAPTION>
MONEY MARKET ALL AMERICA EQUITY INDEX BOND
FUND FUND FUND FUND
------------ ----------- ------------ -----------
<S> <C> <C> <C> <C>
Net investment income........ $3,165,422 $ 7,367,119 $1,592,820 $20,901,007
Net realized capital gains... -- 24,934,463 1,880,679 763,401
---------- ----------- ---------- -----------
Total dividends.............. $3,165,422 $32,301,582 $3,473,499 $21,664,408
========== =========== ========== ===========
Dividend amounts per share... $ .050 $ .129 $ .056 $ .097
========== =========== ========== ===========
Increase in number of shares
per fund.................... 2,659,830 13,283,731 2,182,072 15,684,625
========== =========== ========== ===========
</TABLE>
53
<PAGE>
MUTUAL OF AMERICA INVESTMENT CORPORATION
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
SHORT-TERM MID-TERM COMPOSITE AGGRESSIVE
BOND FUND BOND FUND FUND EQUITY FUND
---------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
Ordinary income.................. $606,778 $1,825,609 $10,869,333 $ 451,594
Capital gains.................... -- -- 24,752,054 18,947,501
-------- ---------- ----------- -----------
Total dividends.................. $606,778 $1,825,609 $35,621,387 $19,399,095
======== ========== =========== ===========
Dividend amounts per share....... $ .042 $ .142 $ .250 $ .244
======== ========== =========== ===========
Increase in number of shares per
fund............................ 590,553 2,035,806 20,004,080 13,092,538
======== ========== =========== ===========
</TABLE>
54
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors and Shareholders
of Mutual of America Investment Corporation:
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments in securities, of Mutual of America
Investment Corporation (a Maryland Corporation) comprising, respectively, the
Money Market, All America (formerly the Stock Fund), Equity Index, Bond,
Short-Term Bond, Mid-Term Bond, Composite, and Aggressive Equity Funds as of
December 31, 1996, and the related statement of operations for the year then
ended and the statements of changes in net assets for each of the two years in
the period then ended, and the financial highlights for each of the five years
in the period then ended. These financial statements and the financial
highlights are the responsibility of the Corporation's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmations of securities
owned as of December 31, 1996 by correspondence with the custodian. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
the Money Market, All America (formerly the Stock Fund), Equity Index, Bond,
Short-Term Bond, Mid-Term Bond, Composite, and Aggressive Equity Funds of
Mutual of America Investment Corporation as of December 31, 1996, the results
of their operations for the year then ended and the changes in their net
assets for each of the two years in the period then ended and their financial
highlights for each of the five years in the period then ended in conformity
with generally accepted accounting principles.
/s/ Arthur Andersen LLP
New York, New York
February 21, 1997
55
<PAGE>
PART C--OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements for the year ended December 31, 1996 are included in
Part B.
(b) Exhibits. The following Exhibits are filed herewith:
Exhibit 11(a). Consent of Arthur Andersen LLP
Exhibit 11(b). Consent of Graham & James LLP
ITEM 28. BUSINESS AND OTHER CONNECTIONS WITH INVESTMENT ADVISER
Mutual of America Capital Management Corporation (the "Adviser") is the
investment adviser to the Investment Company, and is registered as an
investment adviser under the Investment Advisers Act of 1940. The names,
addresses and positions with the Adviser of each Director and officer of the
Adviser is set forth below.
<TABLE>
<CAPTION>
POSITIONS WITH PRINCIPAL OCCUPATION
NAME ADVISER DURING PAST TWO YEARS
- ---- -------------- ---------------------
<S> <C> <C>
Thomas J. Moran Director, Chairman President and Director of Mutual of America Life, Chief
320 Park Avenue of the Board Executive Officer, Mutual of America Life since October
NY, NY 10022 1994
Manfred Altstadt Senior Executive Senior Executive Vice President and Chief Financial
320 Park Avenue Vice President Officer of Mutual of America Life and American Life
NY, NY 10022 andChief
FinancialOfficer
F. Harlan Batrus Director Partner, Lazard Freres
Roger E. Birk Director Past President and Director, Federal National Mortgage
Association. Chairman Emeritus, Merrill Lynch & Co.
Inc.
Robert X. Chandler Director Retired; formerly President, United Way of
Massachusetts Bay, Inc.
Nathaniel A. Davis Director Chief Operating Officer, MCI Metro
Anthony F. Earley Director President and Chief Operating Officer, Detroit Edison;
prior thereto President and Chief Operating Officer,
Long Island Lighting Company (LILCO)
William H. Gates Director Partner, Preston, Thorgrimson, Shidler, Gates & Ellis,
Attorneys
William T. Knowles Director Consultant
Walter A. McDougal Director Former Chairman and President, Richmond Hill Savings
Bank
John W. Davidson President and Chief President and Chief Executive Officer of the Adviser
Executive Officer since March 1996; President and Chief Executive
Officer, Munich Re Capital Management Co., March 1994
to January 1995; prior thereto, Vice President, Fixed
Income Portfolios, Bankers Trust Company
Patrick A. Burns Senior Executive Senior Executive Vice President and General Counsel of
320 Park Avenue Vice President and Mutual of America Life and American Life
NY, NY 10022 General Counsel
Stephanie J. Kopp Executive Vice Executive Vice President and Secretary of Mutual of
320 Park Avenue President and America Life and American Life
NY, NY 10022 Secretary
Andrew L. Heiskell Executive Vice Executive Vice President of the Adviser
320 Park Avenue President
NY, NY 10022
Roger C. Ferrara Senior Vice Senior Vice President, Mutual of America Life, until
320 Park Avenue President January 1994
NY, NY 10022
</TABLE>
C-1
<PAGE>
<TABLE>
<CAPTION>
POSITIONS WITH PRINCIPAL OCCUPATION
NAME ADVISER DURING PAST TWO YEARS
- ---- -------------- ---------------------
<S> <C> <C>
Frederick M. Senior Vice Senior Vice President of the Adviser since July 1995;
Gallagher President prior thereto, consultant
320 Park Avenue
NY, NY 10022
Jon J. LaBerge Senior Vice Senior Vice President of the Adviser since November
320 Park Avenue President/ 1996; prior thereto, Vice President of Global
NY, NY 10022 Administration Retirement & Securities Services, Bankers Trust Company
Nancy McAvey Senior Vice Vice President of the Adviser until September 1994;
320 Park Avenue President prior thereto Vice President, Mutual of America Life
NY, NY 10022
I. Charles Rinaldi Senior Vice Vice President of the Adviser until July 1995
320 Park Avenue President
NY, NY 10022
Paul Travers Senior Vice Vice President of the Adviser until March 1996; Senior
320 Park Avenue President Vice President, Mutual of America Life
NY, NY 10022
David Wood Senior Vice Vice President of the Adviser until July 1995
320 Park Avenue President
NY, NY 10022
Aline Couture Vice President Vice President of the Adviser
320 Park Avenue
NY, NY 10022
Karen Greenburg Vice President Vice President of the Adviser since August 1996; prior
320 Park Avenue thereto, Associate Director of Domestic Equities
NY, NY 10022 Evaluation Associates
Doris Klug Vice President Vice President of the Adviser
320 Park Avenue
NY, NY 10022
Jonathan Lee Vice President/ Vice President of the Adviser since February 1997;
320 Park Avenue Quantitative Analyst prior thereto, Vice President/Equity Analyst for BEA
NY, NY 10022 Associates
Charles McCaghey Vice President Second Vice President of the Adviser
320 Park Avenue
NY, NY 10022
Eli Salzmann Vice President Vice President of the Adviser since April 1996; prior
320 Park Avenue thereto,
NY, NY 10022 Vice President, Mitchell Hutchins Asset Management Inc.
Robert H. Stewart Vice President Vice President of the Adviser
320 Park Avenue
NY, NY 10022
Gary P. Wetterau Vice President Vice President of the Adviser since September 1995;
320 Park Avenue prior thereto, Portfolio Manager at M.D. Sass Investors
NY, NY 10022 Services, Inc.
</TABLE>
Each of Palley-Needelman Asset Management, Inc. ("Palley-Needelman"), Oak
Associates, Ltd. ("Oak Associates") and Fred Alger Management, Inc. ("Alger
Management") is a subadviser for a portion of the Active Assets of the All
America Fund allocated to it. Each subadviser is registered as an investment
adviser under the Investment Advisers Act of 1940. The names, addresses and
positions of each director and officer of each subadviser are incorporated by
reference to the Form ADV of the subadviser filed with the Securities and
Exchange Commission, as set forth below.
Palley-Needleman Asset Management Inc., Form ADV, SEC File No. 801-9755.
Oak Associates, Ltd., Form ADV, SEC File No. 801-23632.
Fred Alger Management, Inc., Form ADV, SEC File No. 801-06709.
C-2
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933 AND THE INVESTMENT
COMPANY ACT OF 1940, THE REGISTRANT HAS DULY CAUSED THIS POST-EFFECTIVE
AMENDMENT TO ITS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED IN THE CITY OF NEW YORK, THE STATE OF
NEW YORK, THE 27TH DAY OF FEBRUARY, 1997.
Mutual of America Investment Corporation
By /s/ Dolores J. Morrissey
--------------------------------------
Dolores J. Morrissey
President
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS POST-
EFFECTIVE AMENDMENT TO ITS REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE
FOLLOWING PERSONS IN THE CAPACITIES AND ON FEBRUARY 27, 1997.
PRINCIPAL EXECUTIVE OFFICER:
By /s/ Dolores J. Morrissey
-----------------------------------------
Dolores J. Morrissey
President
PRINCIPAL FINANCIAL OFFICER
and
PRINCIPAL ACCOUNTING OFFICER:
/s/ Manfred Altstadt
- -------------------------------------------
Manfred Altstadt
DIRECTORS:
/s/ Manfred Altstadt
- -------------------------------------------
Manfred Altstadt
/s/ Dolores J. Morrissey
___________________________________________
Dolores J. Morrissey
*
___________________________________________
Peter J. Flanagan
*
___________________________________________
George J. Mertz
*
___________________________________________
James J. Needham
*
___________________________________________
Howard J. Nolan
By: */s/ Manfred Altstadt
- -------------------------------------------
Attorney-in-fact
C-3
<PAGE>
EXHIBIT INDEX
No. Page
- --- ----
27.1 Financial Data Schedule for Mutual of America
Investment Corporation--Money Market Fund
27.2 Financial Data Schedule for Mutual of America
Investment Corporation--All America Fund
27.3 Financial Data Schedule for Mutual of America
Investment Corporation--Equity-Index Fund
27.4 Financial Data Schedule for Mutual of America
Investment Corporation--Bond Fund
27.5 Financial Data Schedule for Mutual of America
Investment Corporation--Short-Term Bond Fund
27.6 Financial Data Schedule for Mutual of America
Investment Corporation--Mid-Term Bond Fund
27.7 Financial Data Schedule for Mutual of America
Investment Corporation--Composite Fund
27.8 Financial Data Schedule for Mutual of America
Investment Corporation--Aggressive Equity Fund
99.11(a) Consent of Arthur Andersen LLP
99.11(b) Consent of Graham & James LLP
<PAGE>
EXHIBIT 99.11(a)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our reports
(and to all references to our Firm) included in or made a part of Registration
Statement No. 33-6486.
ARTHUR ANDERSEN LLP
New York, New York
February 27, 1997
<PAGE>
EXHIBIT 99.11(b)
CONSENT OF GRAHAM & JAMES LLP
We hereby consent to all references to our firm included in Registration
Statement No. 33-6486.
GRAHAM & JAMES LLP
New York, New York
February 27, 1997
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 1
<NAME> MONEY MARKET FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 77,780,114
<INVESTMENTS-AT-VALUE> 77,780,114
<RECEIVABLES> 0
<ASSETS-OTHER> 437
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 77,780,551
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<PAID-IN-CAPITAL-COMMON> 77,697,824
<SHARES-COMMON-STOCK> 65,361,651
<SHARES-COMMON-PRIOR> 62,332,604
<ACCUMULATED-NII-CURRENT> 87,923
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (5,196)
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<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 3,302,561
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<EXPENSES-NET> 152,048
<NET-INVESTMENT-INCOME> 3,150,513
<REALIZED-GAINS-CURRENT> (161)
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<NET-CHANGE-FROM-OPS> 3,150,352
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 3,165,422
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<NUMBER-OF-SHARES-SOLD> 50,280,297
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<ACCUMULATED-NII-PRIOR> 102,832
<ACCUMULATED-GAINS-PRIOR> (5,035)
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<GROSS-ADVISORY-FEES> 152,048
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<GROSS-EXPENSE> 152,048
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<PER-SHARE-NAV-BEGIN> 1.18
<PER-SHARE-NII> .06
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<PER-SHARE-DIVIDEND> (.05)
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<PER-SHARE-NAV-END> 1.19
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</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 2
<NAME> ALL AMERICA FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 428,665,730
<INVESTMENTS-AT-VALUE> 634,437,558
<RECEIVABLES> 2,081,449
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<OTHER-ITEMS-ASSETS> 1,437,135
<TOTAL-ASSETS> 637,956,142
<PAYABLE-FOR-SECURITIES> 1,286,793
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<SHARES-COMMON-PRIOR> 250,787,286
<ACCUMULATED-NII-CURRENT> (244,122)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (3,506,387)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 205,771,829
<NET-ASSETS> 636,669,349
<DIVIDEND-INCOME> 9,749,497
<INTEREST-INCOME> 489,184
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<NET-INVESTMENT-INCOME> 7,314,135
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<ACCUMULATED-NII-PRIOR> (191,138)
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<PER-SHARE-NAV-BEGIN> 2.13
<PER-SHARE-NII> .13
<PER-SHARE-GAIN-APPREC> .31
<PER-SHARE-DIVIDEND> (.03)
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<PER-SHARE-NAV-END> 2.44
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</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 3
<NAME> EQUITY INDEX FUND
<S> <C>
<PERIOD-TYPE> 12 mos
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
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<INVESTMENTS-AT-VALUE> 102,092,337
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<OTHER-ITEMS-ASSETS> 175,921
<TOTAL-ASSETS> 102,287,419
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<ACCUMULATED-NII-CURRENT> (8,055)
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<PER-SHARE-NAV-BEGIN> 1.35
<PER-SHARE-NII> .06
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</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 4
<NAME> BOND FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
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</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER>5
<NAME>SHORT-TERM BOND FUND
<S> <C>
<PERIOD-TYPE> 12 MOS.
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 15,307,684
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<ACCUMULATED-NII-PRIOR> (5,498)
<ACCUMULATED-GAINS-PRIOR> (10,776)
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<PER-SHARE-DIVIDEND> (.04)
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</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 06
<NAME> MID-TERM BOND FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 13,148,656
<INVESTMENTS-AT-VALUE> 13,172,410
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<OTHER-ITEMS-ASSETS> 187,110
<TOTAL-ASSETS> 13,359,520
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<PAID-IN-CAPITAL-COMMON> 14,621,441
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<NET-INVESTMENT-INCOME> 1,885,137
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<GROSS-EXPENSE> 163,102
<AVERAGE-NET-ASSETS> 27,016
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .14
<PER-SHARE-GAIN-APPREC> (.10)
<PER-SHARE-DIVIDEND> (.14)
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<PER-SHARE-NAV-END> .90
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</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER>7
<NAME>COMPOSITE FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
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<SHARES-COMMON-PRIOR> 152,935,666
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</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 8
<NAME> AGGRESSIVE EQUITY FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
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</TABLE>
