<PAGE>
SUNAMERICA EQUITY FUNDS
SHAREHOLDER LETTER
DEAR SHAREHOLDER:
ECONOMIC OVERVIEW
1995 was a year of spectacular stock market performance, while early 1996 is
expected to perform in line with long-term historical averages of 10-15%. This
is a continuation of a bull market driven by moderate economic growth,
corporate profits and inflows of capital.
As we enter the fourth year of this economic recovery, inflation remains
moderate--our forecast is 3% for 1996. Commodity prices and wages are rising,
but not enough to necessitate a strong tightening of monetary policy by the
Federal Reserve, which is expected to maintain its current stance through the
November elections. Bond yields have recently risen slightly, with the 30-year
benchmark rate approaching, and crossing 7%, which translates into a real rate
of return (the nominal rate minus inflation) of 4%. Interest and inflation
rates are important to both stock and bond investors because each investor,
institutional or individual, makes choices between a number of alternatives.
Controlled inflation and current interest rate levels mean that the bond
market is not necessarily attracting dollars that might otherwise flow into
stocks.
In addition to these economic factors, expected strong corporate profits in
the next four quarters also point to a continuation of the bull stock market.
Earnings multiples are currently at 16-17 times 1996 earnings but at only 14-
15 times year-end June 1997 expectations. Because the market looks forward to
determine current pricing, this analysis leads to a conclusion of a continued
upward trend. Divergent viewpoints of market followers may temper this
optimistic outlook slightly--strategists and economists who take a
macroeconomic view expect flat or down operating profits in 1996, while
analysts who focus on sector or individual corporate performance see increases
of 8-10%. While these different expectations may cause some confusion in
equity prices, stock market prices rose 5-7% in the first quarter of 1996, and
we expect this market trend to continue.
BALANCED ASSETS FUND
With the economy growing at a moderate rate and the stock market proceeding
upward at a slower pace than 1995, the key to performance in the first part of
1996 has been diversification. Balancing the equity portion of the portfolio
using both growth companies and companies that benefit from changing economic
cycles has helped the Fund perform in this changing economic backdrop. As of
March 31, 1996, our allocation is 68% stocks and 29% bonds. We focus on
companies with solid fundamentals, high earnings visibility and consistent
double-digit earnings. Over the past several months we have increased or taken
new positions in several sectors: energy services, retail and technology. We
believe that technology stocks will thrive in the second half of 1996, along
with interest rate sensitive stocks that may benefit as the economy slows and
interest rates potentially fall.
BLUE CHIP GROWTH FUND
The portfolio of the Blue Chip Growth Fund also contains a mix of cyclical
and growth stocks. Cyclical stocks are those whose prices are partially
dependent on changing economic cycles. An example of a cyclical industry
sector held by the Fund is energy services. We have also increased our
commitment to financial services stocks, which don't fit neatly into the
cyclical category, but which benefit in the current interest rate environment.
1
<PAGE>
SUNAMERICA EQUITY FUNDS
SHAREHOLDER LETTER
Growth companies are those whose revenues and earnings are growing more
rapidly than the market as a whole; these companies tend to be in new or
changing industries, or simply companies having unusual success capturing
market share. The Fund holds 20% in technology stocks, and we expect this
allocation to increase in the coming months. The gaming/leisure and retail
industries are other growth areas we have purchased.
Because we believe that there may be some short-term market volatility as
investment managers shift between growth and cyclical sectors based on their
personal economic outlooks, we will focus the portfolio on companies with
solid fundamentals and high expected earnings.
MID-CAP GROWTH FUND
During the first quarter of 1996, large-capitalization cyclical stocks out
performed smaller growth company issues. We positioned this Fund in selected
industries and stocks to capture potential gains from both arenas. Cyclical
stocks in the portfolio included Consolidated Papers, Crane Co., Crown, Cork
and Seal, Praxair Inc. and NN Ball and Roller Inc. Energy companies, and in
particular companies specializing in drilling and supply equipment are
benefiting from an increase in demand and better technology for finding oil
and gas.
Growth companies in the Fund come primarily from the health care and
technology sectors. The technology sector displayed mixed performance in late
1995; as a result we reduced allocations to personal computer and
semiconductor stocks and increased positions in selected software,
telecommunications and data communication companies. These firms include
Sterling Software Inc., MFS Communications Inc., United Video Satellite Group,
U.S. Robotics Corp. and Tellabs Inc. We believe prospects for these companies
are strong as corporations and public entities improve or build computer
networks and as industry deregulation creates enhanced competition and
opportunity.
Also included in the portfolio are certain retail companies gaining market
share--department stores such as Federated Department Stores, manufacturers
such as Jones Apparel Group Inc. and Nine West Group Inc. and marketing
powerhouse NIKE, Inc. Selected niches of the health care industry are also
attractive. Expedited review schedules at the Food and Drug Administration are
helping several biotechnology and pharmaceutical firms; names owned by the
Fund are Amgen Inc., Lilly (Eli) & Co. and Noven Pharmaceuticals Inc. We
believe medical device companies such as Guidant Corp. and Physio Control
International Corp. as well as service providers such as the HMO Pacificare
and PhyCor, Inc. may also do well in the coming months. We have accumulated
financial service firms which benefit from the low interest rate environment
and a continuing positive yield curve such as Prudential Reinsurance Holdings
Inc., First American Bank of Tennessee and PNC Bank Corp.
SMALL COMPANY GROWTH FUND
The Small Company Growth Fund maintains a stance similar to that of our
other equity funds, but focuses on smaller firms. During the first months of
1996, larger stock averages performed better than smaller company averages,
evidenced by the mediocre showing of the NASDAQ Composite Index. We believe
that smaller company stocks are now poised to catch up during the second
quarter of 1996, and that they are undervalued relative to revenue/earnings
growth and to the large cap universe.
2
<PAGE>
SUNAMERICA EQUITY FUNDS
SHAREHOLDER LETTER
The Fund has about equal weightings in apparel & textiles, such as Jones
Apparel Group Inc., Just for Feet Inc. and Quicksilver Inc.; energy service
stocks such as Reading and Bates Corp., Sonat Offshore Drilling and Falcon
Drilling Inc.; telecommunications/data communications equipment stocks such as
Tellabs, Cicso, Retix, Newbridge Networks; specialty chemical companies such
as M.A. Hannah; and health care, pharmaceutical or biotechnology firms
companies such as Neurex Corp., Guilford Pharmaceuticals Inc. and Teva
Pharmaceuticals Industries Ltd.
We have chosen these industries based on our investment philosophy of
evaluating broad-based economic trends, focusing on industries that stand to
benefit from these trends, then finding companies with outstanding
opportunities, management and products.
GLOBAL BALANCED FUND
At March 31, 1996, the Global Balanced Fund was allocated: 53.6% to foreign
equities, 15.5% in foreign bonds, 15.6% in domestic equities and 6.2% in U.S.
Treasury Notes. These allocations have not changed substantially over the past
six months, because we believe that the foreign equity markets may be
undervalued relative to the U.S. equity markets, which had a spectacular 1995.
The first three months of 1996 have not shown foreign markets coming back as
strongly as we had hoped, but we believe that they will improve in the coming
months. The international equity portion of the Fund is dominated by Japanese
stocks poised to benefit from falling interest rates and an improving economy
in Japan. The U.S. equity portion of the portfolio is distributed in selected
growth and cyclical company stocks. The international fixed income portion of
the Fund is positioned in country allocation and maturity to mirror the J.P.
Morgan International Government Bond Index. U.S. bond holdings consist of a
small position U.S. Treasury Notes--a reflection of our belief that the U.S.
market offered lower real rates of return (interest rates minus inflation)
than many European alternatives.
GROWTH & INCOME FUND
High growth companies with consistent earnings and dividends form the core
of the Growth and Income Fund's portfolio. Lack of an economic consensus from
institutional investors and drifting market signals led us to place both
growth company stocks and cyclical stocks in the Fund. We have added or
increased positions in cyclical industries such as automotive and chemicals.
Growth industries held in the portfolio include health services and retail.
Because capturing dividend income is an important goal of this Fund, we have
purchased companies that have improving cash flows due to restructuring. Ford
Motor, ITT Industries Inc. and Hercules Inc. are examples of such companies.
OUTLOOK
In addition to the factors mentioned previously--earnings growth, controlled
inflation, moderate economic conditions and interest rates--the increasing
demand for equity investments should support or increase stock market values
in the future. This demand is from individuals who realize that they can no
longer depend solely on social security or corporate pensions for their
retirement income. These individuals are saving more, either on their own or
through tax-advantaged programs such as employer-sponsored 401(k) plans. Plus,
familiarity with the periodic fluctuations of equity markets and its long-term
performance record has allowed investors to get comfortable with the concept
of equity investing for retirement. Proof of
3
<PAGE>
SUNAMERICA EQUITY FUNDS
SHAREHOLDER LETTER
this trend is seen with the fact that in the first quarter of 1996, more money
was invested in equity mutual funds than in all four quarters of 1990 combined.
While these unprecedented inflows may slow, they are evidence that more
Americans are saving for the future. Demand for attractive equity investments
will lead to higher valuations for the market as a whole, and while we may see
a 5-7% correction, prospects for positive future stock market performance, and
for your Funds remain bright.
/s/ Stanton J. Feeley /s/ Audrey Snell
Stanton J. Feeley Audrey Snell
Chief Investment Officer Portfolio Manager
4
<PAGE>
SUNAMERICA EQUITY FUNDS
STATEMENT OF ASSETS AND LIABILITIES -- March 31, 1996 (unaudited)
<TABLE>
<CAPTION>
BALANCED BLUE CHIP MID-CAP SMALL COMPANY GLOBAL GROWTH AND
ASSETS GROWTH GROWTH GROWTH BALANCED INCOME
FUND FUND FUND FUND FUND FUND
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investment securities, at
value (identified cost
$285,937,411;
$81,776,931;
$41,186,826;
$132,673,317;
$20,661,425 and
$7,876,075,
respectively)........... $306,616,158 $88,463,000 $48,516,413 $165,611,218 $22,477,460 $8,599,375
Short-term securities
(cost equals market).... -- -- -- -- 2,825,000 --
Repurchase agreements
(cost equals market).... 8,278,000 4,095,000 2,106,000 22,066,000 243,000 747,000
Cash..................... 554 611 964 465,323 8,112 880
Foreign cash............. -- -- -- -- 35,837 --
Receivable for
investments sold........ 44,583 -- -- 7,270,143 316,806 239,077
Receivable for shares of
beneficial interest
sold.................... 1,007,749 32,171 113,343 2,425,288 184,382 21,662
Interest and dividends
receivable.............. 1,667,752 71,826 17,059 27,613 225,763 20,084
Prepaid expenses......... 6,875 31,033 5,367 5,224 493 50
Receivable from
investment adviser...... -- -- -- -- 5,611 9,376
Unrealized appreciation
of foreign currency
contracts............... -- -- -- -- 80,096 --
Receivable for foreign
currency contracts sold. -- -- -- -- 1,448,521 --
Deferred organizational
expenses................ -- -- -- -- 2,773 897
------------ ----------- ----------- ------------ ----------- ----------
Total assets............ 317,621,671 92,693,641 50,759,146 197,870,809 27,853,854 9,638,401
------------ ----------- ----------- ------------ ----------- ----------
LIABILITIES:
Payable for investments
purchased............... 3,443,876 2,126,038 -- 5,692,666 1,717,263 156,272
Payable for shares of
beneficial interest
redeemed................ 229,286 29,363 17,265 106,747 52,337 --
Accrued expenses......... 114,437 72,121 57,661 93,892 85,081 40,445
Investment advisory and
management fees payable. 197,323 57,271 31,521 116,471 20,184 5,812
Distribution and service
maintenance fees
payable................. 185,649 49,716 20,821 96,294 15,310 4,888
Dividends payable........ 53,852 -- -- -- -- 518
Unrealized depreciation
of foreign currency
contracts............... -- -- -- -- 59,369 --
Payable for foreign
currency contracts
purchased............... -- -- -- -- 1,457,837 --
------------ ----------- ----------- ------------ ----------- ----------
Total liabilities....... 4,224,423 2,334,509 127,268 6,106,070 3,407,381 207,935
------------ ----------- ----------- ------------ ----------- ----------
Net assets........... $313,397,248 $90,359,132 $50,631,878 $191,764,739 $24,446,473 $9,430,466
============ =========== =========== ============ =========== ==========
NET ASSETS WERE COMPOSED
OF:
Shares of beneficial
interest, $.01 par
value................... $ 190,499 $ 53,542 $ 30,531 $ 86,706 $ 33,080 $ 9,813
Paid-in capital.......... 274,178,392 75,853,800 42,246,554 153,541,932 23,160,086 7,747,926
------------ ----------- ----------- ------------ ----------- ----------
274,368,891 75,907,342 42,277,085 153,628,638 23,193,166 7,757,739
Accumulated undistributed
net investment loss..... (27,814) (188,971) (118,469) (396,339) (269,064) (28,280)
Accumulated undistributed
net realized gain (loss)
on investments.......... 18,377,424 7,965,359 1,143,675 5,583,551 (2,547,988) 977,703
Accumulated net realized
gain (loss) on foreign
currency and other
assets and liabilities.. -- (10,667) -- 10,988 2,242,766 --
Net unrealized
appreciation of
investments............. 20,678,747 6,686,069 7,329,587 32,937,901 1,816,035 723,300
Net unrealized
appreciation of foreign
currency, other assets
and liabilities......... -- -- -- -- 11,558 4
------------ ----------- ----------- ------------ ----------- ----------
Net assets........... $313,397,248 $90,359,132 $50,631,878 $191,764,739 $24,446,473 $9,430,466
============ =========== =========== ============ =========== ==========
CLASS A (UNLIMITED SHARES
AUTHORIZED):
Net asset value and
redemption price per
share
($142,045,343/8,633,410;
$48,668,849/2,861,064;
$39,159,482/2,351,870;
$112,033,258/5,023,335;
$9,039,466/1,219,166 and
$5,332,383/554,743 net
assets and shares of
beneficial interest
issued and outstanding,
respectively)........... $ 16.45 $ 17.01 $ 16.65 $ 22.30 $ 7.41 $ 9.61
Maximum sales charge
(5.75% of offering
price).................. 1.00 1.04 1.02 1.36 0.45 0.59
------------ ----------- ----------- ------------ ----------- ----------
Maximum offering price to
public.................. $ 17.45 $ 18.05 $ 17.67 $ 23.66 $ 7.86 $ 10.20
============ =========== =========== ============ =========== ==========
CLASS B (UNLIMITED SHARES
AUTHORIZED):
Net asset value, offering
price and redemption
price (less any
applicable contingent
deferred sales charge)
per share
($171,351,905/10,416,502;
$41,690,283/2,493,112;
$11,472,396/701,261;
$79,731,481/3,647,300;
$15,407,007/2,088,821
and $4,098,083/426,539
net assets and shares of
beneficial interest
issued and outstanding,
respectively)........... $ 16.45 $ 16.72 $ 16.36 $ 21.86 $ 7.38 $ 9.61
============ =========== =========== ============ =========== ==========
</TABLE>
See Notes to Financial Statements
5
<PAGE>
SUNAMERICA EQUITY FUNDS
STATEMENT OF OPERATIONS -- For the six months ended March 31, 1996 (unaudited)
<TABLE>
<CAPTION>
BALANCED BLUE CHIP MID-CAP SMALL COMPANY GLOBAL GROWTH AND
ASSETS GROWTH GROWTH GROWTH BALANCED INCOME
FUND FUND FUND FUND FUND FUND
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Income:
Interest (net of
withholding taxes of
$206 on Global
Balanced Fund)........ $ 3,124,361 $ 160,095 $ 204,710 $ 877,628 $ 209,579 $ 30,035
Dividends (net of
withholding taxes of
$5,304, $599, $599,
$1,774, $14,089 and
$508, respectively) .. 1,468,003 427,607 90,811 179,216 113,660 78,713
----------- ---------- ---------- ----------- ---------- ----------
Total investment
income................ 4,592,364 587,702 295,521 1,056,844 323,239 108,748
----------- ---------- ---------- ----------- ---------- ----------
Expenses:
Investment advisory and
management fees....... 1,103,927 316,551 176,676 610,724 114,479 28,374
Distribution and
service maintenance
fees-Class A.......... 225,390 77,797 65,568 165,820 15,408 7,615
Distribution and
service maintenance
fees-Class B.......... 827,931 199,791 48,231 340,528 70,456 16,071
Transfer agent fees and
expenses-Class A...... 168,232 60,177 52,030 134,737 12,905 5,112
Transfer agent fees and
expenses-Class B...... 204,304 56,035 13,707 93,159 19,420 4,761
Custodian fees and
expenses.............. 64,150 34,410 32,750 52,350 89,235 23,525
Registration fees-Class
A..................... 6,702 4,856 5,417 9,867 3,603 4,362
Registration fees-Class
B..................... 2,194 4,089 2,885 7,034 4,210 3,589
Audit and tax
consulting fees....... 26,375 10,475 8,295 16,370 6,265 2,250
Trustees' fees and
expenses.............. 15,533 4,826 2,672 8,859 1,289 436
Printing expense....... 9,035 4,530 2,735 7,575 1,595 --
Insurance expense...... 3,241 920 586 1,863 295 60
Legal fees and
expenses.............. 2,185 490 -- 1,800 -- --
Interest expense....... -- 146 1,107 -- -- --
Amortization of
organizational
expenses.............. -- -- -- -- 440 139
Miscellaneous expenses. 3,648 1,580 1,331 2,497 516 595
----------- ---------- ---------- ----------- ---------- ----------
Total expenses......... 2,662,847 776,673 413,990 1,453,183 340,116 96,889
Less: expenses
waived/reimbursed by
investment adviser.... -- -- -- -- (48,186) (55,272)
----------- ---------- ---------- ----------- ---------- ----------
Net expenses........... 2,662,847 776,673 413,990 1,453,183 291,930 41,617
----------- ---------- ---------- ----------- ---------- ----------
Net investment income
(loss)................. 1,929,517 (188,971) (118,469) (396,339) 31,309 67,131
----------- ---------- ---------- ----------- ---------- ----------
REALIZED AND UNREALIZED
GAIN (LOSS) ON
INVESTMENTS:
Net realized gain on
investments............ 23,612,521 9,578,483 1,377,332 6,314,880 598,804 1,019,306
Net realized gain on
foreign currency and
other assets and
liabilities............ -- -- -- 37 571,733 --
Net change in unrealized
appreciation
(depreciation) of
investments............ (4,828,407) (1,510,812) 1,409,318 8,954,942 267,392 370,323
Net change in unrealized
appreciation
(depreciation) of
foreign currency and
other assets and
liabilities............ -- -- -- -- (34,369) 4
----------- ---------- ---------- ----------- ---------- ----------
Net realized and
unrealized gain on
investments, foreign
currency and other
assets and liabilities. 18,784,114 8,067,671 2,786,650 15,269,859 1,403,560 1,389,633
----------- ---------- ---------- ----------- ---------- ----------
NET INCREASE IN NET
ASSETS RESULTING FROM
OPERATIONS: ........... $20,713,631 $7,878,700 $2,668,181 $14,873,520 $1,434,869 $1,456,764
=========== ========== ========== =========== ========== ==========
</TABLE>
See Notes to Financial Statements
6
<PAGE>
SUNAMERICA EQUITY FUNDS
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
BALANCED ASSETS FUND BLUE CHIP GROWTH FUND MID-CAP GROWTH FUND
-------------------------------- -------------------------------- --------------------------------
FOR THE SIX MONTHS FOR THE YEAR FOR THE SIX MONTHS FOR THE YEAR FOR THE SIX MONTHS FOR THE YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
MARCH 31, 1996 SEPTEMBER 30, MARCH 31, 1996 SEPTEMBER 30, MARCH 31, 1996 SEPTEMBER 30,
(UNAUDITED) 1995 (UNAUDITED) 1995 (UNAUDITED) 1995
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net investment income
(loss)............... $ 1,929,517 $ 4,234,844 $ (188,971) $ (42,924) $ (118,469) $ (237,687)
Net realized gain on
investments.......... 23,612,521 13,383,399 9,578,483 7,615,892 1,377,332 7,432,643
Net realized loss on
foreign currency and
other assets and
liabilities.......... -- -- -- (10,667) -- --
Net change in
unrealized
appreciation/
depreciation of
investments.......... (4,828,407) 28,115,267 (1,510,812) 6,757,773 1,409,318 3,253,371
------------ ------------ ----------- ----------- ----------- -----------
Net increase in net
assets resulting from
operations............ 20,713,631 45,733,510 7,878,700 14,320,074 2,668,181 10,448,327
------------ ------------ ----------- ----------- ----------- -----------
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment
income (Class A)..... (1,190,514) (1,892,197) -- -- -- (81,917)
From net investment
income (Class B)..... (1,010,515) (4,315,134) -- -- -- (10,723)
From net realized
gains on investments
(Class A)............ (7,282,221) (2,033,487) (4,646,751) (221,327) (4,337,142) --
From net realized
gains on investments
(Class B)............ (9,730,482) (7,043,145) (4,492,488) (5,263,567) (1,083,506) --
------------ ------------ ----------- ----------- ----------- -----------
Total dividends and
distributions to
shareholders.......... (19,213,732) (15,283,963) (9,139,239) (5,484,894) (5,420,648) (92,640)
------------ ------------ ----------- ----------- ----------- -----------
NET INCREASE (DECREASE)
IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS
(NOTE 8).............. 29,866,184 18,827,961 9,679,875 (1,851,797) 6,126,708 (43,053)
------------ ------------ ----------- ----------- ----------- -----------
TOTAL INCREASE IN NET
ASSETS................ 31,366,083 49,277,508 8,419,336 6,983,383 3,374,241 10,312,634
NET ASSETS:
Beginning of period.... 282,031,165 232,753,657 81,939,796 74,956,413 47,257,637 36,945,003
------------ ------------ ----------- ----------- ----------- -----------
End of period
[including
undistributed net
investment income
(loss) for March 31,
1996 and September 30,
1995 of $(27,814),
$243,698; $(188,971),
$0; $(118,469), and
$0, respectively]..... $313,397,248 $282,031,165 $90,359,132 $81,939,796 $50,631,878 $47,257,637
============ ============ =========== =========== =========== ===========
</TABLE>
See Notes to Financial Statements
7
<PAGE>
SUNAMERICA EQUITY FUNDS
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SMALL COMPANY GROWTH FUND GLOBAL BALANCED FUND GROWTH AND INCOME FUND
-------------------------------- -------------------------------- --------------------------------
FOR THE SIX MONTHS FOR THE YEAR FOR THE SIX MONTHS FOR THE YEAR FOR THE SIX MONTHS FOR THE YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
MARCH 31, 1996 SEPTEMBER 30, MARCH 31, 1996 SEPTEMBER 30, MARCH 31, 1996 SEPTEMBER 30,
(UNAUDITED) 1995 (UNAUDITED) 1995 (UNAUDITED) 1995
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income
(loss)............... $ (396,339) $ (587,404) $ 31,309 $ 305,478 $ 67,131 $ 183,673
Net realized gain
(loss) on
investments.......... 6,314,880 31,433,571 598,804 (2,564,836) 1,019,306 346,652
Net realized gain on
foreign currency,
other assets and
liabilities.......... 37 10,951 571,733 1,756,424 -- --
Net change in
unrealized
appreciation/
depreciation of
investments.......... 8,954,942 15,112,125 267,392 1,847,343 370,323 297,243
Net change in
unrealized
appreciation/depreciation
of foreign currency,
other assets and
liabilities.......... -- -- (34,369) 42,526 4 --
------------ ------------ ----------- ----------- ---------- ----------
Net increase in net
assets resulting from
operations............ 14,873,520 45,969,243 1,434,869 1,386,935 1,456,764 827,568
------------ ------------ ----------- ----------- ---------- ----------
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment
income (Class A)..... -- -- (478,740) (24,601) (61,435) (127,668)
From net investment
income (Class B)..... -- -- (693,095) (12,084) (36,891) (54,591)
From net realized
gains on investments
(Class A)............ (16,561,192) (985,792) -- (3,604) (175,889) (63,470)
From net realized
gains on investments
(Class B)............ (12,782,675) (1,122,738) -- (3,671) (127,334) (13,320)
------------ ------------ ----------- ----------- ---------- ----------
Total dividends and
distributions to
shareholders.......... (29,343,867) (2,108,530) (1,171,835) (43,960) (401,549) (259,049)
------------ ------------ ----------- ----------- ---------- ----------
NET INCREASE (DECREASE)
IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS
(NOTE 8).............. 48,411,982 23,184,310 592,438 (4,383,749) 2,304,940 2,174,079
------------ ------------ ----------- ----------- ---------- ----------
TOTAL INCREASE
(DECREASE) IN NET
ASSETS................ 33,941,635 67,045,023 855,472 (3,040,774) 3,360,155 2,742,598
NET ASSETS:
Beginning of period.... 157,823,104 90,778,081 23,591,001 26,631,775 6,070,311 3,327,713
------------ ------------ ----------- ----------- ---------- ----------
End of period
[including
undistributed net
investment income
(loss) for March 31,
1996 and September 30,
1995 of $(396,339),
$0; $(269,064),
$871,462; $(28,280),
and $2,915,
respectively]......... $191,764,739 $157,823,104 $24,446,473 $23,591,001 $9,430,466 $6,070,311
============ ============ =========== =========== ========== ==========
</TABLE>
See Notes to Financial Statements
8
<PAGE>
SUNAMERICA EQUITY FUNDS
FINANCIAL HIGHLIGHTS
BALANCED ASSETS FUND
<TABLE>
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME(1) UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(2) (000'S)
- ---------------- --------- --------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
9/24/93-
9/30/93(3)..... $15.07 $ -- $ 0.06 $ 0.06 $ -- $ -- $ -- $15.13 0.40% $ 33,381
9/30/94......... 15.13 0.30 (0.23) 0.07 (0.28) (0.30) (0.58) 14.62 0.50 52,098
9/30/95......... 14.62 0.32 2.51 2.83 (0.45) (0.58) (1.03) 16.42 20.68 119,916
3/31/96(7)...... 16.42 0.13 1.04 1.17 (0.15) (0.99) (1.14) 16.45 7.43 142,045
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- ------------- -------------- ---------
<S> <C> <C> <C>
9/24/93-
9/30/93(3)..... 1.54%(4) 0.46%(4) 25%
9/30/94......... 1.58 2.00 141
9/30/95......... 1.50 2.13 130
3/31/96(7)...... 1.46(4) 1.66(4) 79
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME(1) UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(2) (000'S)
- ---------------- --------- --------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS B
6/30/92(5)...... $15.75 $0.33 $ 0.98 $ 1.31 $(0.42) $(1.01) $(1.43) $15.63 7.51% $ 83,234
6/30/93(5)...... 15.63 0.30 2.63 2.93 (0.30) (2.40) (2.70) 15.86 20.29 113,871
7/01/93-
9/30/93(5)..... 15.86 0.05 0.49 0.54 (0.06) (1.21) (1.27) 15.13 3.44 137,456
9/30/94......... 15.13 0.20 (0.23) (0.03) (0.18) (0.30) (0.48) 14.62 (0.14) 180,655
9/30/95......... 14.62 0.23 2.51 2.74 (0.36) (0.58) (0.94) 16.42 19.96 162,115
3/31/96(7)...... 16.42 0.08 1.04 1.12 (0.10) (0.99) (1.09) 16.45 7.10 171,352
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- ------------- -------------- ---------
<S> <C> <C> <C>
6/30/92(5)...... 1.93%(6) 2.04%(6) 151%
6/30/93(5)...... 1.91(6) 1.94(6) 251
7/01/93-
9/30/93(5)..... 2.10(4)(6) 1.36(4)(6) 25
9/30/94......... 2.21 1.36 141
9/30/95......... 2.12 1.59 130
3/31/96(7)...... 2.08(4) 1.04(4) 79
</TABLE>
- --------------------------------------------------------------------------------
BLUE CHIP GROWTH FUND
<TABLE>
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(2) (000'S)
- ---------------- --------- ------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/08/93-
9/30/94(3)..... $16.24 $ 0.09 (1) $(0.26) $(0.17) $ -- $(0.65) $(0.65) $15.42 (1.05)% $ 3,207
9/30/95......... 15.42 0.02 (1) 2.99 3.01 -- (1.09) (1.09) 17.34 21.29 42,407
3/31/96(7)...... 17.34 (0.01)(1) 1.59 1.58 -- (1.91) (1.91) 17.01 9.93 48,669
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- -------------- --------------- ---------
<S> <C> <C> <C>
10/08/93-
9/30/94(3)..... 1.64%(4)(6) 0.65%(4)(6) 170%
9/30/95......... 1.58(6) 0.11(6) 251
3/31/96(7)...... 1.53(4) (0.14)(4) 120
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(2) (000'S)
- ---------------- --------- ------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS B
12/31/91(5)..... $ 9.65 $(0.06) $ 2.94 $ 2.88 $ -- $ -- $ -- $12.53 29.84% $105,734
12/31/92(5)..... 12.53 (0.13) 1.19 1.06 -- -- -- 13.59 8.46 83,237
1/01/93-
9/30/93(5)..... 13.59 (0.02)(1) 2.71 2.69 -- -- -- 16.28 19.79 79,774
9/30/94......... 16.28 (0.01)(1) (0.28) (0.29) -- (0.65) (0.65) 15.34 (1.81) 71,749
9/30/95......... 15.34 (0.01)(1) 2.89 2.88 -- (1.09) (1.09) 17.13 20.51 39,533
3/31/96(7)...... 17.13 (0.06)(1) 1.56 1.50 -- (1.91) (1.91) 16.72 9.56 41,690
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- -------------- --------------- ---------
<S> <C> <C> <C>
12/31/91(5)..... 2.50% (0.42)% 79%
12/31/92(5)..... 2.53 (0.75) 192
1/01/93-
9/30/93(5)..... 2.46(4) (0.14)(4) 171
9/30/94......... 2.28 (0.05) 170
9/30/95......... 2.22 (0.09) 251
3/31/96(7)...... 2.19(4) (0.79)(4) 120
</TABLE>
- ------------
(1) Calculated based upon average shares outstanding
(2) Total return is not annualized and does not reflect sales load
(3) Commencement of sale of respective class of shares
(4) Annualized
(5) Pursuant to a reorganization of the SunAmerica Mutual Funds, the Equity
Funds fiscal year ends were changed to September 30
(6) Net of the following expense reimbursements (based on average net assets):
<TABLE>
<CAPTION>
6/30/92 6/30/93 9/30/93 9/30/94 9/30/95
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Balanced Assets Class B.............. .12% .05% .04% -- --
Blue Chip Growth Class A............. -- -- -- 1.66% .11%
</TABLE>
(7) Unaudited
See Notes to Financial Statements
9
<PAGE>
SUNAMERICA EQUITY FUNDS
FINANCIAL HIGHLIGHTS
MID-CAP GROWTH FUND
<TABLE>
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(1) (000'S)
- ---------------- --------- ------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
11/30/91(4)..... $12.90 $0.16 $ 3.09 $ 3.25 $(0.25) $(2.60) $(2.85) $13.30 31.13% $29,142
11/30/92(4)..... 13.30 (0.07) 2.87 2.80 (0.02) (0.44) (0.46) 15.64 21.42 30,024
12/01/92-
9/30/93(4)..... 15.64 (0.09)(2) 3.17 3.08 -- (0.69) (0.69) 18.03 20.42 34,918
9/30/94......... 18.03 0.04 (2) (1.64) (1.60) -- (2.65) (2.65) 13.78 (9.60) 32,906
9/30/95......... 13.78 (0.08)(2) 4.14 4.06 (0.04) -- (0.04) 17.80 29.51 37,714
3/31/96(9)...... 17.80 (0.03)(2) 0.99 0.96 -- (2.11) (2.11) 16.65 5.75 39,160
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- -------------- --------------- ---------
<S> <C> <C> <C>
11/30/91(4)..... 1.76% 1.20% 225%
11/30/92(4)..... 1.76 (0.46) 98
12/01/92-
9/30/93(4)..... 1.81(3) 1.18 (3) 231
9/30/94......... 1.76 0.28 555
9/30/95......... 1.66 (0.51) 392
3/31/96(9)...... 1.62(3) (0.36)(3) 155
CLASS B
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(1) (000'S)
- ---------------- --------- ------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS B
10/04/93-
9/30/94(5)..... $18.12 $0.03 (2) $(1.80) $(1.77) $ -- $(2.65) $(2.65) $13.70 (10.56)% $ 4,039
9/30/95......... 13.70 (0.18)(2) 4.08 3.90 (0.02) -- (0.02) 17.58 28.55 9,544
3/31/96(9)...... 17.58 (0.09)(2) 0.98 0.89 -- (2.11) (2.11) 16.36 5.40 11,472
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- -------------- --------------- ---------
<S> <C> <C> <C>
10/04/93-
9/30/94(5)..... 2.43%(3)(6) 0.20%(3)(6) 555%
9/30/95......... 2.31(7) (0.17)(7) 392
3/31/96(9)...... 2.30(3) (1.07)(3) 155
</TABLE>
- --------------------------------------------------------------------------------
SMALL COMPANY GROWTH FUND
<TABLE>
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS RATIO OF
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF EXPENSES
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD TO AVERAGE
ENDED OF PERIOD INCOME(2) UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(1) (000'S) NET ASSETS
- ---------------- --------- --------- ----------- ---------- --------- ------- ------- --------- --------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
11/30/91(4)(8).. $11.88 $(0.01) $ 4.92 $ 4.91 $ -- $(2.91) $(2.91) $13.88 52.05% $27,832 1.86%
11/30/92(4)(8).. 13.88 (0.12) 3.39 3.27 -- (0.69) (0.69) 16.46 24.31 32,056 1.90
12/01/92-
9/30/93(4)(8).. 16.46 (0.02) 4.07 4.05 -- (0.73) (0.73) 19.78 25.68 39,238 1.83(3)
9/30/94......... 19.78 (0.10) (1.40) (1.50) -- (1.46) (1.46) 16.82 (7.74) 38,570 1.67
9/30/95......... 16.82 (0.04) 8.28 8.24 -- (0.41) (0.41) 24.65 50.00 89,510 1.57
3/31/96(9)...... 24.65 (0.02) 2.20 2.18 -- (4.53) (4.53) 22.30 9.75 112,033 1.52(3)
<CAPTION>
RATIO OF NET
INVESTMENT
INCOME
PERIOD TO AVERAGE PORTFOLIO
ENDED NET ASSETS TURNOVER
- ---------------- ------------ ---------
<S> <C> <C>
11/30/91(4)(8).. (0.06)% 110%
11/30/92(4)(8).. (0.88) 209
12/01/92-
9/30/93(4)(8).. (0.15)(3) 216
9/30/94......... (0.60) 411
9/30/95......... (0.22) 351
3/31/96(9)...... (0.22)(3) 137
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS RATIO OF
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF EXPENSES
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD TO AVERAGE
ENDED OF PERIOD INCOME(2) UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(1) (000'S) NET ASSETS
- ---------------- --------- --------- ----------- ---------- --------- ------- ------- --------- --------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS B
9/24/93-
9/30/93(5)..... $19.66 $ -- $ 0.12 $ 0.12 $ -- $ -- $ -- $19.78 0.61% $38,898 2.34%(3)
9/30/94......... 19.78 (0.20) (1.42) (1.62) -- (1.46) (1.46) 16.70 (8.40) 52,208 2.31
9/30/95......... 16.70 (0.16) 8.19 8.03 -- (0.41) (0.41) 24.32 49.08 68,313 2.22
3/31/96(9) 24.32 (0.09) 2.16 2.07 -- (4.53) (4.53) 21.86 9.39 79,732 2.16 (3)
<CAPTION>
RATIO OF NET
INVESTMENT
INCOME
PERIOD TO AVERAGE PORTFOLIO
ENDED NET ASSETS TURNOVER
- ---------------- ------------ ---------
<S> <C> <C>
9/24/93-
9/30/93(5)..... (1.70)%(3) 216%
9/30/94......... (1.23) 411
9/30/95......... (0.84) 351
3/31/96(9) (0.86) (3) 137
</TABLE>
- ------------
(1) Total return is not annualized and does not reflect sales load
(2) Calculated based upon average shares outstanding
(3) Annualized
(4) Pursuant to a reorganization of the SunAmerica Mutual Funds, the Equity
Funds fiscal year ends were changed to September 30
(5) Commencement of sale of respective class of shares
(6) Net of expense reimbursement equivalent to .48% of average net assets for
the period ended 9/30/94
(7) Net of expense reimbursement equivalent to .17% of average net assets for
the year ended 9/30/95
(8) Restated to reflect a 0.984460367 for 1.00 stock split effective September
24, 1993
(9) Unaudited
See Notes to Financial Statements
10
<PAGE>
SUNAMERICA EQUITY FUNDS
FINANCIAL HIGHLIGHTS
GLOBAL BALANCED FUND
<TABLE>
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME(1) UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(2) (000'S)
- ---------------- --------- --------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
6/15/94-
9/30/94(3)..... $6.94 $0.02 $(0.05) $(0.03) $ -- $ -- $ -- $6.91 (0.43)% $13,100
9/30/95......... 6.91 0.10 0.36 0.46 (0.01) -- (0.01) 7.36 6.72 9,615
3/31/96(6)...... 7.36 0.02 0.45 0.47 (0.42) -- (0.42) 7.41 6.69 9,039
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- -------------- --------------- ---------
<S> <C> <C> <C>
6/15/94-
9/30/94(3)..... 2.15%(4)(5) 0.93%(4)(5) 18%
9/30/95......... 2.15(5) 1.36(5) 169
3/31/96(6)...... 2.15(4)(5) 0.66(4)(5) 70
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME(1) UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(2) (000'S)
- ---------------- --------- --------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS B
6/16/94-
9/30/94(3)..... $6.94 $0.01 $(0.05) $(0.04) $ -- $ -- $ -- $6.90 (0.58)% $13,532
9/30/95......... 6.90 0.05 0.36 0.41 (0.01) -- (0.01) 7.30 5.91 13,976
3/31/96(6)...... 7.30 -- 0.46 0.46 (0.38) -- (0.38) 7.38 6.46 15,407
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- -------------- --------------- ---------
<S> <C> <C> <C>
6/16/94-
9/30/94(3)..... 2.80%(4)(5) 0.33%(4)(5) 18%
9/30/95......... 2.80(5) 0.75(5) 169
3/31/96(6)...... 2.80(4)(5) 0.03(4)(5) 70
</TABLE>
- --------------------------------------------------------------------------------
GROWTH AND INCOME FUND
<TABLE>
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME(1) UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(2) (000'S)
- ---------------- --------- --------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
7/01/94-
9/30/94(3)..... $7.33 $0.07 $0.10 $0.17 $(0.06) $ -- $(0.06) $7.44 2.34% $3,098
9/30/95......... 7.44 0.32 1.08 1.40 (0.30) (0.15) (0.45) 8.39 19.53 3,532
3/31/96(6)...... 8.39 0.09 1.65 1.74 (0.13) (0.39) (0.52) 9.61 21.20 5,332
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- ------------- -------------- ---------
<S> <C> <C> <C>
7/01/94-
9/30/94(3)..... 1.50%(4)(5) 3.48%(4)(5) 8%
9/30/95......... 0.46(5) 4.16(5) 230
3/31/96(6)...... 0.86(4)(5) 2.02(4)(5) 103
<CAPTION>
NET
GAIN(LOSS)
ON INVEST- TOTAL DIVIDENDS DISTRI-
NET ASSET NET MENTS (BOTH FROM FROM NET BUTIONS NET ASSET NET ASSETS
VALUE, INVEST- REALIZED INVEST- INVEST- FROM TOTAL VALUE, END OF
PERIOD BEGINNING MENT AND MENT MENT CAPITAL DISTRI- END OF TOTAL PERIOD
ENDED OF PERIOD INCOME(1) UNREALIZED) OPERATIONS INCOME GAINS BUTIONS PERIOD RETURN(2) (000'S)
- ---------------- --------- --------- ----------- ---------- --------- ------- ------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS B
7/06/94-
9/30/94(3)..... $7.33 $0.05 $0.11 $0.16 $(0.05) $ -- $(0.05) $7.44 2.19% $ 229
9/30/95......... 7.44 0.35 1.03 1.38 (0.28) (0.15) (0.43) 8.39 19.19 2,538
3/31/96(6)...... 8.39 0.07 1.65 1.72 (0.11) (0.39) (0.50) 9.61 20.91 4,098
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED NET ASSETS NET ASSETS TURNOVER
- ---------------- ------------- -------------- ---------
<S> <C> <C> <C>
7/06/94-
9/30/94(3)..... 2.15%(4)(5) 2.86%(4)(5) 8%
9/30/95......... 0.30(5) 4.48(5) 230
3/31/96(6)...... 1.42(4)(5) 1.45(4)(5) 103
</TABLE>
- ------------
(1) Calculated based upon average shares outstanding
(2) Total return is not annualized and does not reflect sales load
(3) Commencement of sale of respective class of shares
(4) Annualized
(5) Net of the following expense reimbursements (based on average net assets):
<TABLE>
<CAPTION>
9/30/94 9/30/95 3/31/96
------- ------- -------
<S> <C> <C> <C>
Global Balanced Class A.............................. 1.14% .40% .45%
Global Balanced Class B.............................. .93 .45 .40
Growth and Income Class A............................ 4.48 2.96 1.39
Growth and Income Class B............................ 20.35 5.07 1.56
</TABLE>
(6) Unaudited
See Notes to Financial Statements
11
<PAGE>
SUNAMERICA BALANCED ASSETS FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- ------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK--68.0%
AEROSPACE & MILITARY TECHNOLOGY--1.1%
Boeing Co. .............................................. 40,000 $ 3,465,000
-----------
APPAREL & TEXTILES--1.7%
NIKE, Inc. .............................................. 35,000 2,843,750
Tommy Hilfiger Corp.+ ................................... 30,000 1,376,250
Warnaco Group, Inc....................................... 50,000 1,206,250
-----------
5,426,250
-----------
AUTOMOTIVE--2.8%
Chrysler Corp. .......................................... 50,000 3,112,500
Dana Corp. .............................................. 40,000 1,335,000
Ford Motor Co. .......................................... 60,000 2,062,500
General Motors Corp. .................................... 40,000 2,130,000
-----------
8,640,000
-----------
BANKS--6.5%
Bank Of Boston Corp. .................................... 40,000 1,985,000
BankAmerica Corp. ....................................... 20,000 1,550,000
Chemical Banking Corp. .................................. 50,000 3,525,000
Citicorp................................................. 30,000 2,400,000
First Bank System, Inc. ................................. 25,000 1,490,625
First Interstate Bancorp ................................ 15,000 2,602,500
First Security Corp. .................................... 45,000 1,248,750
Signet Banking Corp. .................................... 30,000 746,250
Summit Bancorp .......................................... 130,000 4,810,000
-----------
20,358,125
-----------
BROADCASTING & MEDIA--1.2%
Cellularvision USA, Inc.+ ............................... 15,000 165,000
Scholastic Corp.+ ....................................... 15,000 1,031,250
Time Warner, Inc. ....................................... 30,000 1,226,250
Viacom, Inc. Class B+.................................... 30,000 1,263,750
-----------
3,686,250
-----------
CHEMICALS--3.2%
Cabot Corp. ............................................. 67,400 2,055,700
du Pont (E.I.) de Nemours & Co. ......................... 35,000 2,905,000
Rohm & Haas Co. ......................................... 25,000 1,662,500
Union Carbide Corp. ..................................... 50,000 2,481,250
Witco Corp. ............................................. 25,000 881,250
-----------
9,985,700
-----------
COMMUNICATION EQUIPMENT--3.4%
Ericsson (L.M.) Telephone Co. ADR(1)..................... 100,000 2,137,500
General Instrument Corp.+ ............................... 35,000 958,125
Motorola, Inc. .......................................... 25,000 1,325,000
Nokia Corp. ADR(1) ...................................... 20,000 685,000
Octel Communications Corp.+ ............................. 35,000 1,688,750
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
COMMUNICATION EQUIPMENT (CONTINUED)
Tellabs, Inc.+ ........................................... 60,000 $ 2,902,500
U.S. Robotics Corp. ...................................... 7,500 969,375
-----------
10,666,250
-----------
COMPUTERS & BUSINESS EQUIPMENT--2.5%
3Com Corp.+ .............................................. 25,000 996,875
Hewlett-Packard Co. ...................................... 10,000 940,000
International Business Machines Corp. .................... 10,000 1,111,250
Newbridge Networks Corp. ADR+(1) ......................... 30,000 1,687,500
Seagate Technology ....................................... 35,000 1,916,250
Sun Microsystems, Inc.+ .................................. 25,000 1,093,750
-----------
7,745,625
-----------
CONGLOMERATE--2.7%
AlliedSignal, Inc. ....................................... 20,000 1,182,500
Crane Co. ................................................ 20,000 807,500
General Electric Co....................................... 20,000 1,557,500
United Technologies Corp. ................................ 45,000 5,051,250
-----------
8,598,750
-----------
DEPARTMENT STORES--2.2%
May Department Stores Co. ................................ 30,000 1,447,500
Woolworth Corp. .......................................... 350,000 5,468,750
-----------
6,916,250
-----------
ELECTRONICS--0.9%
Applied Materials, Inc.+ ................................. 40,000 1,395,000
LSI Logic Corp.+ ......................................... 35,000 936,250
Texas Instruments, Inc. .................................. 10,000 508,750
-----------
2,840,000
-----------
ENERGY SERVICES--2.4%
Baker Hughes, Inc. ....................................... 35,000 1,023,750
BJ Services Co.+.......................................... 25,000 837,500
Schlumberger Ltd. ADR(1).................................. 15,000 1,186,875
Sonat Offshore Drilling, Inc. ............................ 25,000 1,275,000
Tenneco, Inc. ............................................ 40,557 2,266,122
Tidewater, Inc. .......................................... 25,000 950,000
-----------
7,539,247
-----------
ENERGY SOURCES--1.7%
Anadarko Petroleum Corp. ................................. 20,000 1,110,000
Burlington Resources, Inc. ............................... 30,000 1,113,750
Kerr-McGee Corp. ......................................... 30,000 1,905,000
Pacific Enterprises....................................... 50,000 1,293,750
-----------
5,422,500
-----------
FINANCIAL SERVICES--3.8%
Alex Brown, Inc. ......................................... 30,000 1,556,250
Capital One Financial Corp. .............................. 50,000 1,375,000
</TABLE>
12
<PAGE>
SUNAMERICA BALANCED ASSETS FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited)--(continued)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- -------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
FINANCIAL SERVICES (CONTINUED)
Litchfield Financial Corp. ............................... 50,000 $ 712,500
MBNA Corp. ............................................... 75,000 2,221,875
Morgan Stanley Group, Inc. ............................... 40,000 2,070,000
Reliastar Financial Corp. ................................ 25,000 1,131,250
Student Loan Marketing Association ....................... 35,000 2,677,500
-----------
11,744,375
-----------
FOOD, BEVERAGE & TOBACCO--0.7%
Phillip Morris Cos., Inc. ................................ 10,000 877,500
Pioneer Hi-Bred International, Inc. ...................... 25,000 1,315,625
-----------
2,193,125
-----------
FOREST PRODUCTS--1.1%
Consolidated Papers, Inc. ................................ 30,000 1,687,500
Kimberly-Clark Corp. ..................................... 23,400 1,743,300
-----------
3,430,800
-----------
HEALTH SERVICES--7.4%
Apria Healthcare Group, Inc.+ ............................ 30,000 952,500
Beverly Enterprises, Inc.+ ............................... 75,000 825,000
Caremark International, Inc. ............................. 75,000 1,884,375
Columbia/HCA Healthcare Corp. ............................ 40,000 2,310,000
Coventry Corp.+ .......................................... 35,000 599,375
Foundation Health Corp.+.................................. 30,000 1,143,750
Health Systems International, Inc.+ ...................... 35,300 1,288,450
HEALTHSOUTH Rehabilitation+............................... 40,000 1,360,000
Humana, Inc.+............................................. 120,000 3,015,000
Lincare Holdings, Inc.+ .................................. 75,000 2,437,500
OrNda Healthcorp+......................................... 50,000 1,437,500
Pacificare Health Systems, Inc.+.......................... 20,000 1,705,000
U.S. HealthCare, Inc. .................................... 30,000 1,376,250
United Healthcare Corp. .................................. 45,000 2,767,500
-----------
23,102,200
-----------
HOUSEHOLD PRODUCTS--1.5%
Estee Lauder Cos., Inc. .................................. 30,000 1,072,500
Johnson & Johnson Co. .................................... 20,000 1,845,000
Procter & Gamble Co. ..................................... 20,000 1,695,000
-----------
4,612,500
-----------
INSURANCE--3.2%
Aetna Life & Casualty Co. ................................ 20,000 1,510,000
AMBAC, Inc. .............................................. 50,000 2,406,250
Cigna Corp. .............................................. 10,000 1,142,500
Equitable Cos., Inc. ..................................... 40,000 970,000
Lincoln National Corp. ................................... 35,000 1,776,250
PennCorp Financial Group, Inc.+ .......................... 25,000 787,500
St. Paul Cos., Inc. ...................................... 25,000 1,387,500
-----------
9,980,000
-----------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
LEISURE & TOURISM--1.6%
Disney (Walt) Co. ......................................... 20,000 $ 1,277,500
HFS, Inc.+ ................................................ 20,000 972,500
MGM Grand, Inc.+ .......................................... 30,000 1,151,250
Mirage Resorts, Inc.+ ..................................... 30,000 1,316,250
Red Roof Inn's, Inc.+ ..................................... 25,000 371,875
-----------
5,089,375
-----------
MACHINERY--1.1%
Briggs & Stratton Corp. ................................... 25,000 1,078,125
Case Corp. ................................................ 35,000 1,780,625
Caterpillar, Inc. ......................................... 10,000 680,000
-----------
3,538,750
-----------
MANUFACTURING--0.3%
Trinity Industries, Inc. .................................. 25,000 871,875
-----------
MEDICAL PRODUCTS--1.5%
Becton Dickinson & Co. .................................... 15,000 1,228,125
Guidant Corp. ............................................. 20,000 1,082,500
Medtronic, Inc. ........................................... 40,000 2,385,000
-----------
4,695,625
-----------
METALS & MINING--0.8%
Aluminum Co. of America.................................... 15,000 939,375
Phelps Dodge Corp. ........................................ 25,000 1,715,625
-----------
2,655,000
-----------
PHARMACEUTICALS--7.8%
Abbott Laboratories ....................................... 30,000 1,222,500
American Home Products Corp. .............................. 10,000 1,083,750
Amgen, Inc.+............................................... 30,000 1,743,750
Bristol-Myers Squibb Co. .................................. 25,000 2,140,625
Cephalon, Inc.+ ........................................... 60,000 1,552,500
Glaxo Holdings PLC ADR(1).................................. 50,000 1,256,250
IVAX Corp. ................................................ 40,000 1,035,000
Lilly (Eli) & Co. ......................................... 40,000 2,600,000
Merck & Co., Inc. ......................................... 54,000 3,361,500
Pfizer, Inc. .............................................. 20,000 1,340,000
Schering-Plough Corp. ..................................... 32,500 1,889,063
Smithkline Beecham PLC ADR(1).............................. 40,000 2,060,000
Synaptic Pharmaceutical Corp.+ ............................ 3,000 60,000
Teva Pharmaceutical Industries Ltd. ADR(1)................. 30,000 1,155,000
Warner-Lambert Co. ........................................ 20,000 2,065,000
-----------
24,564,938
-----------
POLLUTION CONTROL--1.1%
Browning-Ferris Industries, Inc. .......................... 35,000 1,102,500
Millipore Corp. ........................................... 30,000 1,147,500
WMX Technologies, Inc. .................................... 35,000 1,111,250
-----------
3,361,250
-----------
</TABLE>
13
<PAGE>
SUNAMERICA BALANCED ASSETS FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
SHARES/
PRINCIPAL AMOUNT VALUE
SECURITY DESCRIPTION (IN THOUSANDS) (NOTE 2)
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
SOFTWARE--1.9%
Informix Corp.+ ................................ 50,000 $ 1,318,750
Microsoft Corp.+ ............................... 20,000 2,062,500
Oracle Systems Corp.+ .......................... 25,000 1,178,125
PeopleSoft, Inc.+ .............................. 25,000 1,437,500
------------
5,996,875
------------
SPECIALTY RETAIL--0.6%
Home Depot, Inc.+............................... 40,000 1,915,000
------------
TELECOMMUNICATIONS--0.6%
AT&T Corp. ..................................... 30,000 1,837,500
------------
TRANSPORTATION--0.7%
Union Pacific Corp. ............................ 30,000 2,058,750
------------
TOTAL COMMON STOCK
(cost $191,875,316)............................. 212,937,885
------------
OPTIONS--0.8%+
STOCK INDEX PUT OPTIONS--0.8%
S&P 500 Index, June/645(2)......................
(cost $2,235,750)............................... 150,000 2,475,000
------------
BONDS & NOTES--3.8%
APPAREL & TEXTILES--1.0%
Bass America, Inc.
8.13% due 3/31/02.............................. $ 3,000 3,206,850
------------
BANKS--0.6%
Chase Manhattan Corp.
7.88% due 8/01/04.............................. 2,000 2,024,620
------------
FINANCIAL SERVICES--2.2%
Bear Stearns Cos., Inc.
6.63% due 1/15/04.............................. 5,000 4,864,250
Donaldson Lufkin & Jenrette, Inc.
6.88% due 11/01/05............................. 2,000 1,953,480
------------
6,817,730
------------
TOTAL BONDS & NOTES
(cost $11,496,890).............................. 12,049,200
------------
</TABLE>
<TABLE>
<CAPTION>
SHARES/
PRINCIPAL AMOUNT VALUE
SECURITY DESCRIPTION (IN THOUSANDS) (NOTE 2)
<S> <C> <C>
U.S. TREASURY NOTES--23.2%
4.38% due 8/15/96.............................. $5,000 $ 4,982,050
5.13% due 2/28/98.............................. 5,000 4,942,200
5.25% due 1/31/01.............................. 5,000 4,828,100
5.75% due 10/31/97-8/15/03..................... 12,000 11,762,810
5.88% due 11/15/05............................. 10,000 9,637,500
6.25% due 5/31/00.............................. 5,000 5,031,250
6.75% due 5/31/99.............................. 5,000 5,107,800
6.88% due 7/31/99-3/31/00...................... 13,000 13,347,770
7.25% due 2/15/98.............................. 3,300 3,383,523
7.50% due 2/15/05.............................. 5,000 5,365,600
9.25% due 8/15/98.............................. 4,000 4,293,760
------------
TOTAL U.S. TREASURY NOTES
(cost $73,462,736)............................. 72,682,363
------------
U.S. TREASURY BONDS--2.1%
6.25% due 8/15/23
(cost $6,866,719).............................. 7,000 6,471,710
------------
TOTAL INVESTMENT SECURITIES--97.9%
(cost $285,937,411)............................ 306,616,158
------------
REPURCHASE AGREEMENT--2.6%
Joint Repurchase Agreement Account (Note 3)
(cost $8,278,000).............................. 8,278 8,278,000
------------
TOTAL INVESTMENTS--
(cost $294,215,411)............................ 100.5% 314,894,158
Liabilities in excess of other assets........... (0.5) (1,496,910)
---- ------------
NET ASSETS-- 100.0% $313,397,248
===== ============
</TABLE>
- --------
+Non-income producing security
(1)ADR ("American Depositary Receipt")
(2)Fair valued security, see Note 2
See Notes to Financial Statements
14
<PAGE>
SUNAMERICA BLUE CHIP GROWTH FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- -------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK--97.9%
AEROSPACE & MILITARY TECHNOLOGY--1.8%
Boeing Co. ................................................ 15,000 $ 1,299,375
Remec, Inc.+............................................... 25,000 312,500
-----------
1,611,875
-----------
APPAREL & TEXTILES--3.1%
NIKE, Inc. ................................................ 15,000 1,218,750
Tommy Hilfiger Corp.+...................................... 19,000 871,625
Warnaco Group, Inc. ....................................... 30,000 723,750
-----------
2,814,125
-----------
AUTOMOTIVE--3.9%
Chrysler Corp. ............................................ 15,000 933,750
Dana Corp. ................................................ 20,000 667,500
Ford Motor Co. ............................................ 25,000 859,375
General Motors Corp. ...................................... 20,000 1,065,000
-----------
3,525,625
-----------
BANKS--6.8%
BankAmerica Corp. ......................................... 10,000 775,000
Chemical Banking Corp. .................................... 10,000 705,000
Citicorp................................................... 10,000 800,000
First Security Corp. ...................................... 25,000 693,750
Signet Banking Corp. ...................................... 30,000 746,250
Standard Federal Bancorp. ................................. 25,000 1,062,500
Summit Bancorp............................................. 36,000 1,332,000
-----------
6,114,500
-----------
BROADCASTING & MEDIA--3.1%
Big Flower Press Holdings, Inc.+........................... 70,000 892,500
Scholastic Corp.+.......................................... 15,000 1,031,250
Viacom, Inc. Class B+...................................... 20,000 842,500
-----------
2,766,250
-----------
CHEMICALS--2.9%
Cabot Corp................................................. 20,000 610,000
du Pont (E.I.) de Nemours & Co. ........................... 15,000 1,245,000
Union Carbide Corp. ....................................... 15,000 744,375
-----------
2,599,375
-----------
COMMUNICATION EQUIPMENT--5.0%
Ericsson (L.M.) Telephone Co. ADR(1)....................... 30,000 641,250
Motorola, Inc. ............................................ 10,000 530,000
Nokia Corp. ADR(1)......................................... 20,000 685,000
Octel Communications Corp.+................................ 15,000 723,750
QUALCOMM, Inc.+............................................ 10,000 415,000
Tellabs, Inc.+............................................. 25,000 1,209,375
U.S. Robotics Corp. ....................................... 2,500 323,125
-----------
4,527,500
-----------
COMPUTERS & BUSINESS EQUIPMENT--5.1%
3Com Corp.+................................................ 10,000 598,125
Hewlett-Packard Co. ....................................... 5,000 470,000
International Business Machines Corp. ..................... 5,000 555,625
Newbridge Networks Corp. ADR+(1)........................... 18,000 1,012,500
Seagate Technology+........................................ 15,000 821,250
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
COMPUTERS & BUSINESS EQUIPMENT (CONTINUED)
StorMedia, Inc.+............................................ 20,000 $ 465,000
Sun Microsystems, Inc.+..................................... 15,000 656,250
----------
4,578,750
----------
CONGLOMERATE--5.5%
Allied Signal, Inc.......................................... 15,000 886,875
Crane Co. .................................................. 10,000 403,750
General Electric Co......................................... 10,000 778,750
ITT Industries, Inc. ....................................... 25,000 637,500
United Technologies Corp. .................................. 20,000 2,245,000
----------
4,951,875
----------
CONSUMER GOODS--1.1%
Galoob (Lewis) Toys, Inc.+.................................. 50,000 1,012,500
----------
DEPARTMENT STORES--2.4%
May Department Stores Co. .................................. 20,000 965,000
Woolworth Corp. ............................................ 75,000 1,171,875
----------
2,136,875
----------
ELECTRICAL EQUIPMENT--0.4%
General Instrument Corp. ................................... 15,000 410,625
----------
ELECTRONICS--1.4%
Aavid Thermal Technologies, Inc.+........................... 30,000 255,000
Applied Materials, Inc.+.................................... 10,000 348,750
LSI Logic Corp.+............................................ 15,000 401,250
Texas Instruments, Inc. .................................... 5,000 254,375
----------
1,259,375
----------
ENERGY SERVICES--2.7%
Baker Hughes, Inc. ......................................... 20,000 585,000
BJ Services Co.+............................................ 10,000 335,000
Schlumberger Ltd. ADR(1).................................... 5,000 395,625
Sonat Offshore Drilling, Inc. .............................. 15,000 765,000
Tidewater, Inc. ............................................ 10,000 380,000
----------
2,460,625
----------
FINANCIAL SERVICES--6.2%
Alex Brown, Inc. ........................................... 10,000 518,750
Capital One Financial Corp. ................................ 15,000 412,500
First USA, Inc. ............................................ 20,000 1,132,500
MBNA Corp. ................................................. 25,000 740,625
Morgan Stanley Group, Inc. ................................. 15,000 776,250
Reliastar Financial Corp. .................................. 20,000 905,000
Student Loan Marketing Association.......................... 15,000 1,147,500
----------
5,633,125
----------
FOOD, BEVERAGE & TOBACCO--2.0%
IBP, Inc. .................................................. 20,000 512,500
Pioneer Hi-Bred International, Inc. ........................ 15,000 789,375
Robert Mondavi Corp.+....................................... 20,000 515,000
----------
1,816,875
----------
</TABLE>
15
<PAGE>
SUNAMERICA BLUE CHIP GROWTH FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- -------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
FOREST PRODUCTS--1.9%
Consolidated Papers, Inc. ................................. 10,000 $ 562,500
Kimberly-Clark Corp. ...................................... 15,000 1,117,500
-----------
1,680,000
-----------
HEALTH SERVICES--10.8%
Apria Healthcare Group, Inc.+ ............................. 20,000 635,000
Beverly Enterprises, Inc.+................................. 25,000 275,000
Caremark International, Inc. .............................. 20,000 502,500
Columbia/HCA Healthcare Corp. ............................. 20,000 1,155,000
Coventry Corp.+............................................ 15,000 256,875
Health Management Associates, Inc.+........................ 25,000 875,000
Healthsource, Inc.+........................................ 20,000 775,000
Humana, Inc.+.............................................. 35,000 879,375
Lincare Holdings, Inc.+.................................... 30,000 975,000
OrNda Healthcorp+.......................................... 20,000 575,000
Pacificare Health Systems, Inc.+........................... 5,000 426,250
U.S. HealthCare, Inc. ..................................... 20,000 917,500
United Healthcare Corp. ................................... 25,000 1,537,500
-----------
9,785,000
-----------
HOUSEHOLD PRODUCTS--0.9%
Procter & Gamble Co. ...................................... 10,000 847,500
-----------
INSURANCE--2.1%
Aetna Life & Casualty Co. ................................. 15,000 1,132,500
Lincoln National Corp. .................................... 15,000 761,250
-----------
1,893,750
-----------
LEISURE & TOURISM--3.6%
Disney (Walt) Co. ......................................... 15,000 958,125
HFS, Inc.+................................................. 10,000 486,250
MGM Grand, Inc.+........................................... 20,000 767,500
Mirage Resorts, Inc.+...................................... 20,000 877,500
Red Roof Inn's, Inc.+...................................... 10,000 148,750
-----------
3,238,125
-----------
MACHINERY--0.5%
Briggs & Stratton Corp. ................................... 10,000 431,250
-----------
MEDICAL PRODUCTS--3.7%
Becton Dickinson & Co. .................................... 10,000 818,750
Boston Scientific Corp.+................................... 10,000 460,000
Guidant Corp. ............................................. 10,000 541,250
Johnson & Johnson Co. ..................................... 10,000 922,500
Medtronic, Inc............................................. 10,000 596,250
-----------
3,338,750
-----------
METALS & MINING--0.3%
Aluminum Co. of America.................................... 5,000 313,125
-----------
PHARMACEUTICALS--10.3%
Abbott Laboratories........................................ 15,000 611,250
Amgen, Inc.+............................................... 15,000 871,875
Bristol-Myers Squibb Co. .................................. 10,000 856,250
Cephalon, Inc.+............................................ 20,000 517,500
</TABLE>
<TABLE>
<CAPTION>
SHARES/
PRINCIPAL AMOUNT VALUE
SECURITY DESCRIPTION (IN THOUSANDS) (NOTE 2)
<S> <C> <C>
PHARMACEUTICALS (CONTINUED)
IVAX Corp. ...................................... 20,000 $ 517,500
Lilly (Eli) & Co. ............................... 20,000 1,300,000
Merck & Co., Inc. ............................... 20,000 1,245,000
Pfizer, Inc. .................................... 10,000 670,000
Schering-Plough Corp. ........................... 20,000 1,162,500
Smithkline Beecham PLC ADR(1).................... 15,000 772,500
Teva Pharmaceutical Industries Ltd. ADR(1)....... 20,000 770,000
-----------
9,294,375
-----------
POLLUTION CONTROL--2.2%
Browning-Ferris Industries, Inc. ................ 15,000 472,500
Culligan Water Technologies, Inc.+............... 15,000 487,500
Millipore Corp. ................................. 15,000 573,750
WMX Technologies, Inc. .......................... 15,000 476,250
-----------
2,010,000
-----------
SOFTWARE--6.4%
Business Objects SA ADR+(1)...................... 10,000 850,000
Fiserv, Inc.+.................................... 30,000 840,000
Informix, Corp.+................................. 25,000 659,375
Microsoft Corp.+................................. 10,000 1,031,250
Oracle Systems Corp.+............................ 15,000 706,875
PeopleSoft, Inc.+................................ 15,000 862,500
SunGuard Data Systems, Inc.+..................... 25,000 856,250
-----------
5,806,250
-----------
TELECOMMUNICATIONS--1.0%
AT&T Corp. ...................................... 15,000 918,750
-----------
TRANSPORTATION--0.8%
Union Pacific Corp............................... 10,000 686,250
-----------
TOTAL COMMON STOCK
(cost $81,776,931)............................... 88,463,000
-----------
TOTAL INVESTMENT SECURITIES--97.9%
(cost $81,776,931)............................... 88,463,000
-----------
REPURCHASE AGREEMENT--4.5%
Joint Repurchase Agreement
Account (Note 3)
(cost $4,095,000)................................ $ 4,095 4,095,000
-----------
TOTAL INVESTMENTS--
(cost $85,871,931)............................... 102.4% 92,558,000
Liabilities in excess of other assets............. (2.4) (2,198,868)
------- -----------
NET ASSETS-- 100.0% $90,359,132
======= ===========
</TABLE>
- --------
+ Non-income producing security
(1) ADR ("American Depositary Receipt")
See Notes to Financial Statements
16
<PAGE>
SUNAMERICA MID-CAP GROWTH FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- -----------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK--95.8%
AEROSPACE & MILITARY TECHNOLOGY--0.9%
Remec, Inc.+.............................................. 37,000 $ 462,500
----------
APPAREL & TEXTILES--9.2%
Gap, Inc. ................................................ 10,000 553,750
Gucci Group NV ADR+(1).................................... 20,000 960,000
Jones Apparel Group, Inc.+................................ 15,000 727,500
Mossimo, Inc.+............................................ 5,000 161,875
Nautica Enterprises, Inc.+................................ 10,000 477,500
NIKE, Inc. ............................................... 5,000 406,250
Nine West Group, Inc.+.................................... 10,000 432,500
Quiksilver, Inc.+......................................... 7,500 238,125
Tommy Hilfiger Corp.+..................................... 10,000 458,750
Warnaco Group, Inc. ...................................... 10,000 241,250
----------
4,657,500
----------
BANKS--3.6%
First Tennessee National Corp. ........................... 20,000 660,000
Long Island Bancorp, Inc. ................................ 20,000 562,500
PNC Bank Corp. ........................................... 12,300 378,225
Signet Banking Corp. ..................................... 10,000 248,750
----------
1,849,475
----------
BROADCASTING & MEDIA--2.1%
Infinity Broadcasting Corp.+.............................. 15,000 650,625
United Video Satellite Group+............................. 20,000 420,000
----------
1,070,625
----------
BUSINESS SERVICES--0.8%
Data Processing Resources Corp.+.......................... 15,200 418,000
----------
CHEMICALS--3.6%
Cabot Corp. .............................................. 27,000 823,500
Praxair, Inc. ............................................ 10,000 398,750
Sigma-Aldrich Corp. ...................................... 7,000 400,750
Witco Corp. .............................................. 5,000 176,250
----------
1,799,250
----------
COMMUNICATION EQUIPMENT--3.4%
Octel Communications Corp.+............................... 10,000 482,500
Tellabs, Inc.+............................................ 12,000 580,500
U.S. Robotics Corp. ...................................... 5,000 646,250
----------
1,709,250
----------
COMPUTERS & BUSINESS EQUIPMENT--6.5%
3Com Corp.+............................................... 5,000 199,375
Cisco Systems, Inc.+...................................... 5,000 231,875
Global DirectMail Corp.+.................................. 20,000 697,500
HBO & Co. ................................................ 3,000 282,750
Newbridge Networks Corp. ADR+(1).......................... 13,500 759,375
Seagate Technology........................................ 7,000 383,250
Shiva Corp.+.............................................. 7,000 635,250
Sun Microsystems, Inc.+................................... 2,000 87,500
----------
3,276,875
----------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
CONGLOMERATE--0.8%
Crane Co. .................................................. 10,000 $ 403,750
----------
CONSUMER GOODS--0.5%
Whitman Corp. .............................................. 10,000 242,500
----------
DEPARTMENT STORES--0.6%
Federated Department Stores, Inc.+.......................... 10,000 322,500
----------
ELECTRONICS--0.3%
Analog Devices, Inc.+....................................... 5,000 140,000
----------
ENERGY SERVICES--4.2%
BJ Services Co., Inc.+...................................... 10,000 335,000
Global Marine, Inc.+........................................ 25,000 250,000
Noble Drilling Corp.+....................................... 22,500 278,438
Rowan Cos., Inc.+........................................... 30,000 382,500
Sonat Offshore Drilling, Inc. .............................. 10,000 510,000
Tidewater, Inc. ............................................ 10,000 380,000
----------
2,135,938
----------
ENERGY SOURCES--1.8%
Flores & Rucks, Inc.+ 50,000 925,000
----------
ENTERTAINMENT PRODUCTS--0.4%
Coastcast Corp.+............................................ 10,000 186,250
----------
FOOD, BEVERAGE & TOBACCO--0.8%
Dole Food, Inc. ............................................ 10,000 385,000
----------
FOREST PRODUCTS--0.6%
Consolidated Papers, Inc. .................................. 5,000 281,250
----------
HEALTH SERVICES--6.3%
Enterprise Systems, Inc.+................................... 12,800 353,600
Health Management Associates, Inc.+......................... 15,000 525,000
Healthcare Compare Corp.+................................... 10,000 503,750
OrNda Healthcorp+........................................... 20,000 575,000
Pacificare Health Systems, Inc.+............................ 8,000 682,000
PhyCor, Inc.+............................................... 12,500 550,000
----------
3,189,350
----------
INSURANCE--2.9%
Amerin Corp.+............................................... 20,000 545,000
PennCorp Financial Group, Inc.+............................. 15,000 472,500
Prudential Reinsurance Holdings, Inc. ...................... 20,000 472,500
----------
1,490,000
----------
LEISURE & TOURISM--3.6%
HFS, Inc.+.................................................. 15,000 729,375
Mirage Resorts, Inc.+....................................... 10,000 438,750
Showboat, Inc............................................... 10,000 245,000
Sun International Hotels Ltd.+.............................. 11,000 396,000
----------
1,809,125
----------
MACHINERY--2.4%
Deere & Co. ................................................ 20,000 835,000
Precision Castparts Corp. .................................. 10,000 400,000
----------
1,235,000
----------
</TABLE>
17
<PAGE>
SUNAMERICA MID-CAP GROWTH FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- -------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
MANUFACTURING--2.2%
Crown Cork & Seal, Inc. .................................... 12,000 $ 585,000
Trinity Industries, Inc. ................................... 15,000 523,125
----------
1,108,125
----------
MEDICAL PRODUCTS--6.4%
ADAC Laboratories........................................... 30,000 528,750
Guidant Corp. .............................................. 12,000 649,500
Heartstream, Inc.+.......................................... 10,000 155,000
Hologic, Inc.+.............................................. 14,000 318,500
Lunar Corp.+................................................ 20,000 855,000
Perkin-Elmer Corp. ......................................... 7,000 378,875
VISX, Inc.+................................................. 10,000 365,000
----------
3,250,625
----------
METALS & MINING--0.4%
NN Ball & Roller, Inc. ..................................... 10,000 221,250
----------
PHARMACEUTICALS--8.9%
ABR Information Services, Inc.+............................. 15,000 697,500
Agouron Pharmaceuticals, Inc.+.............................. 5,000 193,750
Amgen, Inc.+................................................ 5,000 290,625
Ergo Science Corp.+......................................... 18,800 380,700
Genzyme Corp.+.............................................. 8,000 440,000
Lilly (Eli) & Co. .......................................... 7,000 455,000
Neurex Corp.+............................................... 30,000 622,500
Noven Pharmaceuticals, Inc.+................................ 29,000 416,875
Physio Control International Corp.+......................... 22,500 450,000
Teva Pharmaceutical Industries Ltd. ADR(1).................. 15,000 577,500
----------
4,524,450
----------
POLLUTION CONTROL--4.7%
Culligan Water Technologies, Inc.+.......................... 20,000 650,000
Millipore Corp. ............................................ 15,000 573,750
Sanifill, Inc.+............................................. 10,000 383,750
United Waste Systems, Inc.+................................. 15,000 750,000
----------
2,357,500
----------
SOFTWARE--11.3%
Applix, Inc.+............................................... 5,000 175,000
Baan Co. NV+................................................ 5,000 288,125
BMC Software, Inc.+......................................... 5,000 273,750
Business Objects SA ADR+(1)................................. 6,000 510,000
Cognos, Inc.+............................................... 3,400 192,950
Computer Associates International, Inc. ADR(1).............. 5,000 358,125
Individual, Inc.+........................................... 11,000 167,750
Informix Corp.+............................................. 10,000 263,750
Innovus Corp.+.............................................. 14,000 140,000
National Data Corp. ........................................ 10,000 341,250
</TABLE>
<TABLE>
<CAPTION>
SHARES/
PRINCIPAL AMOUNT VALUE
SECURITY DESCRIPTION (IN THOUSANDS) (NOTE 2)
<S> <C> <C>
SOFTWARE (CONTINUED)
Oracle Systems Corp.+............................. 10,000 $ 471,250
Pc Docs Group International, Inc. ADR+(1)......... 30,000 532,500
PeopleSoft, Inc.+................................. 5,000 287,500
Rational Software Corp.+.......................... 5,000 197,500
Shared Medical Systems, Inc....................... 5,000 301,250
Sterling Software Inc.+........................... 13,000 916,500
Viasoft, Inc.+.................................... 10,000 281,250
-----------
5,698,450
-----------
SPECIALTY RETAIL--2.8%
AnnTaylor Stores Corp.+........................... 25,000 450,000
Just For Feet, Inc.+.............................. 10,000 416,250
Revco D.S.+....................................... 20,000 550,000
-----------
1,416,250
-----------
TELECOMMUNICATIONS--2.0%
Frontier Corp. ................................... 10,000 315,000
MFS Communications, Inc.+......................... 10,000 622,500
P-COM, Inc.+...................................... 5,000 100,625
-----------
1,038,125
-----------
TRANSPORTATION--1.8%
USAir Group, Inc.+................................ 50,000 912,500
-----------
TOTAL COMMON STOCK
(cost $41,186,826) 48,516,413
-----------
TOTAL INVESTMENT SECURITIES--95.8%
(cost $41,186,826) 48,516,413
-----------
REPURCHASE AGREEMENT--4.2%
Joint Repurchase Agreement Account (Note 3)
(cost $2,106,000)................................ $ 2,106 2,106,000
-----------
TOTAL INVESTMENTS--
(cost $43,292,826)................................ 100.0% 50,622,413
Other assets less liabilities...................... 0.0 9,465
------- -----------
NET ASSETS-- 100.0% $50,631,878
======= ===========
</TABLE>
- --------
+ Non-income producing security
(1) ADR ("American Depositary Receipt")
See Notes to Financial Statements
18
<PAGE>
SUNAMERICA SMALL COMPANY GROWTH FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- -------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK--86.2%
AEROSPACE & MILITARY TECHNOLOGY--1.3%
B.V.R. Technologies Ltd.+.................................. 54,000 $ 459,000
Remec, Inc.+............................................... 100,500 1,256,250
Rohr, Inc.+................................................ 40,000 720,000
----------
2,435,250
----------
APPAREL & TEXTILES--3.1%
Donnkenny, Inc.+........................................... 30,000 483,750
Gucci Group NV ADR+(1)..................................... 20,000 960,000
Jones Apparel Group, Inc.+................................. 20,000 970,000
Mossimo, Inc.+............................................. 29,000 938,875
Nautica Enterprises, Inc.+................................. 27,500 1,313,125
Quiksilver, Inc.+.......................................... 42,500 1,349,375
----------
6,015,125
----------
BANKS--1.2%
Long Island Bancorp, Inc. ................................. 20,000 562,500
Peoples Bank (Bridgeport, Connecticut)..................... 30,000 645,000
Summit Bancorp............................................. 31,500 1,165,500
----------
2,373,000
----------
BROADCASTING & MEDIA--3.0%
IVI Publishing, Inc.+...................................... 75,000 1,031,250
National Media Corp.+...................................... 70,700 1,166,550
Regal Cinemas, Inc.+....................................... 50,000 1,850,000
United Video Satellite Group+.............................. 80,000 1,680,000
----------
5,727,800
----------
BUSINESS SERVICES--3.7%
American List Corp. ....................................... 29,200 919,800
Apollo Group, Inc.+........................................ 35,000 1,365,000
F.Y.I., Inc.+.............................................. 49,500 829,125
IntelliQuest Information Group, Inc.+...................... 17,100 470,250
Mecon, Inc.+............................................... 35,100 693,225
META Group, Inc.+.......................................... 32,000 904,000
RTW, Inc.+ ................................................ 28,800 1,065,600
SOS Staffing Services, Inc.+............................... 80,000 890,000
----------
7,137,000
----------
CHEMICALS--1.3%
CFC International, Inc.+................................... 7,500 88,125
Hanna (M.A.) Co. .......................................... 18,100 628,975
Mycogen Corp.+............................................. 100,000 1,725,000
----------
2,442,100
----------
COMMUNICATION EQUIPMENT--2.2%
Cascade Communications Corp.+.............................. 15,000 1,346,250
Octel Communications Corp.+................................ 40,000 1,930,000
Tellabs, Inc.+............................................. 20,000 967,500
----------
4,243,750
----------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
COMPUTERS & BUSINESS EQUIPMENT--5.2%
Cisco Systems, Inc.+....................................... 40,000 $ 1,855,000
Daisytek International Corp.+.............................. 21,000 693,000
EMJ Data Systems Ltd. ADR(1)............................... 91,500 721,609
Iomega Corp.+.............................................. 40,000 1,025,000
Lumisys, Inc.+............................................. 35,000 652,422
Newbridge Networks Corp. ADR+(1)........................... 32,500 1,828,125
Shiva Corp.+............................................... 10,000 907,500
Structural Dynamics Research Corp.+........................ 65,000 2,193,750
-----------
9,876,406
-----------
CONSUMER GOODS--0.3%
Whitman Corp. ............................................. 20,000 485,000
-----------
ELECTRICAL EQUIPMENT--1.2%
Cidco, Inc.+............................................... 15,000 483,750
FORE Systems, Inc.+........................................ 10,000 715,000
UCAR International, Inc.+.................................. 30,000 1,166,250
-----------
2,365,000
-----------
ELECTRONICS--0.7%
Gemstar Group Ltd.+........................................ 14,000 350,000
Supertex, Inc.+............................................ 80,000 1,030,000
-----------
1,380,000
-----------
ENERGY SERVICES--6.5%
Arethusa (Offshore) Ltd. ADR(1)............................ 30,000 1,128,750
Benton Oil & Gas Co.+...................................... 40,000 630,000
Dual Drilling Co.+......................................... 60,000 1,027,500
ENSCO International, Inc.+................................. 30,000 836,250
Falcon Drilling, Inc.+..................................... 60,000 1,335,000
Marine Drilling Cos., Inc.+................................ 75,000 590,625
Noble Drilling Corp.+...................................... 132,500 1,639,687
Reading & Bates Corp.+..................................... 85,000 1,678,750
Sonat Offshore Drilling, Inc. ............................. 30,000 1,530,000
Tidewater, Inc. ........................................... 25,000 950,000
Weatherford Enterra, Inc.+................................. 30,000 1,046,250
-----------
12,392,812
-----------
ENERGY SOURCES--0.9%
Belco Oil & Gas Corp.+..................................... 13,000 295,750
Pogo Producing Co. ........................................ 25,000 781,250
Pride Petroleum Services, Inc.+............................ 50,000 706,250
-----------
1,783,250
-----------
ENTERTAINMENT PRODUCTS--1.0%
Cannondale Corp.+.......................................... 40,000 735,000
Coastcast Corp.+........................................... 60,000 1,117,500
-----------
1,852,500
-----------
FOREST PRODUCTS--0.4%
Caraustar Industries, Inc. ................................ 30,000 750,000
-----------
</TABLE>
19
<PAGE>
SUNAMERICA SMALL COMPANY GROWTH FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- -------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
HEALTH SERVICES--3.3%
Enterprise Systems, Inc.+................................... 23,200 $ 640,900
Healthcare Compare Corp.+................................... 20,000 1,007,500
Occusystems, Inc.+.......................................... 37,500 853,125
OrNda Healthcorp+........................................... 35,000 1,006,250
Pacificare Health Systems, Inc.+............................ 10,000 852,500
Veterinary Centers of America, Inc.+........................ 75,000 2,025,000
----------
6,385,275
----------
HOUSING--0.6%
Lennar Corp. ............................................... 25,000 621,875
Skyline Corp................................................ 25,000 615,625
----------
1,237,500
----------
INSURANCE--0.5%
Amerin Corp.+............................................... 35,000 953,750
----------
LEISURE & TOURISM--2.1%
Bally Entertainment Group................................... 60,000 1,035,000
HFS, Inc.+.................................................. 15,000 729,375
Penske Motorsports, Inc.+................................... 1,500 55,875
Showboat, Inc. ............................................. 25,000 612,500
Studio Plus America, Inc.+.................................. 55,000 1,526,250
----------
3,959,000
----------
MACHINERY--0.9%
AGCO Corp. ................................................. 20,000 482,500
Case Corp. ................................................. 10,000 508,750
Precision Castparts Corp. .................................. 20,000 800,000
----------
1,791,250
----------
MEDICAL PRODUCTS--3.7%
ADAC Laboratories........................................... 80,000 1,410,000
Cohr, Inc.+................................................. 50,000 812,500
Gulf South Medical Supply, Inc.+............................ 40,000 1,510,000
Heartstream, Inc.+.......................................... 20,000 310,000
Hologic, Inc.+.............................................. 71,000 1,615,250
Pharmacopeia, Inc.+......................................... 35,000 875,000
VISX, Inc.+................................................. 14,000 511,000
----------
7,043,750
----------
METALS & MINING--1.4%
Huntco, Inc. ............................................... 35,000 678,125
Mueller Industries, Inc.+................................... 25,000 884,375
NN Ball & Roller, Inc. ..................................... 50,000 1,106,250
----------
2,668,750
----------
PHARMACEUTICALS--13.9%
ABR Information Services, Inc.+............................. 60,000 2,790,000
Agouron Pharmaceuticals, Inc.+ ............................. 17,000 658,750
Anesta Corp.+............................................... 50,000 712,500
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
PHARMACEUTICALS (CONTINUED)
ArthroCare Corp.+.......................................... 31,500 $ 693,000
Cambridge NeuroScience, Inc.+.............................. 75,000 900,000
Centocor, Inc.+............................................ 55,000 1,986,875
Depotech Corp.+............................................ 50,900 1,247,050
Ergo Science Corp.+........................................ 56,200 1,138,050
Genzyme Corp.+............................................. 50,000 818,750
Guilford Pharmaceuticals, Inc.+............................ 100,000 2,237,500
IDEC Pharmaceuticals Corp.+................................ 25,000 556,250
Immulogic Pharmaceutical Corp.+............................ 50,000 662,500
Interneuron Pharmaceuticals, Inc.+......................... 30,000 1,113,750
Ligand Pharmaceuticals, Inc.+.............................. 60,000 697,500
Myriad Genetics, Inc.+..................................... 11,000 294,250
Neurex Corp.+.............................................. 180,000 3,735,000
Noven Pharmaceuticals, Inc.+............................... 75,000 1,078,125
Parexel International Corp.+............................... 20,000 865,000
Pharmaceutical Product Development, Inc.+.................. 36,500 1,286,625
Physio Control International Corp.+........................ 38,500 770,000
Royce Laboratories, Inc.+.................................. 30,000 266,250
Synaptic Pharmaceutical Corp.+............................. 30,000 600,000
Teva Pharmaceutical Industries Ltd. ADR(1)................. 40,000 1,540,000
-----------
26,647,725
-----------
POLLUTION CONTROL--0.9%
Sanifill, Inc.+............................................ 20,000 767,500
United Waste Systems, Inc.+................................ 17,500 875,000
-----------
1,642,500
-----------
SOFTWARE--16.9%
Applix, Inc.+.............................................. 30,000 1,050,000
Business Objects SA ADR+(1)................................ 19,000 1,615,000
Cimatron Ltd.+............................................. 110,000 797,500
Citrix Systems, Inc.+...................................... 27,000 1,194,750
Cognos, Inc. ADR+(1)....................................... 16,600 942,050
CSG Systems International, Inc.+........................... 50,900 1,170,700
Cybercash, Inc.+........................................... 10,500 357,000
Documentum, Inc.+.......................................... 53,000 1,868,250
DST Systems, Inc.+......................................... 30,000 918,750
Finish Line, Inc.+......................................... 60,000 1,020,000
Forte Software, Inc.+...................................... 23,500 951,750
Geoworks+.................................................. 30,000 900,000
HNC Software, Inc.+........................................ 12,000 816,000
Ikos Systems, Inc.+........................................ 50,000 837,500
IMNET Systems, Inc.+....................................... 50,000 1,512,500
Indus Group, Inc.+......................................... 10,000 195,000
Informix Corp.+............................................ 30,000 791,250
Innovus Corp.+............................................. 92,700 927,000
Innovus Corp.+(2)(3)....................................... 54,000 189,000
Inso Corp.+................................................ 20,000 922,500
Legato Systems, Inc.+...................................... 25,000 943,750
Objective Systems Integrators, Inc.+....................... 10,000 455,000
Oracle Systems Corp.+...................................... 15,000 706,875
</TABLE>
20
<PAGE>
SUNAMERICA SMALL COMPANY GROWTH FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
SOFTWARE (CONTINUED)
Pc Docs Group International, Inc. ADR+(1)................. 85,000 $ 1,508,750
PeopleSoft, Inc.+......................................... 15,000 862,500
PowerCerv Corp.+.......................................... 20,000 297,813
Prism Solutions, Inc.+.................................... 11,100 294,150
Raptor Systems, Inc.+..................................... 31,500 941,062
Rational Software Corp.+.................................. 30,000 1,185,000
Red Brick Systems, Inc.+.................................. 18,000 774,000
Retix+.................................................... 100,000 512,500
Saville Systems PLC ADR+(1)............................... 50,000 943,750
Segue Software, Inc.+..................................... 24,000 504,000
Shared Medical Systems,Inc. .............................. 10,000 602,500
Spyglass, Inc.+........................................... 8,200 177,325
Viasoft, Inc.+............................................ 40,000 1,125,000
Xeikon NV ADR+(1)......................................... 25,000 484,375
Xylan Corp.+.............................................. 8,500 442,000
Zoran Corp+............................................... 29,000 645,250
------------
32,382,100
------------
SPECIALTY RETAIL--2.9%
AnnTaylor Stores Corp.+................................... 50,000 900,000
Gadzooks, Inc.+........................................... 75,000 2,606,250
Garden Ridge Corp.+....................................... 25,000 1,143,750
Just For Feet, Inc.+...................................... 20,000 832,500
------------
5,482,500
------------
TELECOMMUNICATIONS--6.7%
Ascend Communications, Inc.+.............................. 20,000 1,077,500
Aspect Telecommunications Corp.+.......................... 17,500 800,625
Davox Corp.+.............................................. 75,000 1,331,250
Gilat Satellite Networks Ltd. ADR+(1)..................... 20,000 485,000
Harmonic Lightwaves, Inc.+................................ 100,000 1,375,000
InterVoice, Inc.+......................................... 30,000 858,750
MFS Communications, Inc.+................................. 10,000 622,500
Nexus Telecommunication Systems Ltd. ..................... 100,000 550,000
NICE Systems Ltd. ADR+(1)................................. 37,500 487,500
Omnipoint Corp.+.......................................... 15,000 382,500
P-COM, Inc.+.............................................. 40,000 805,000
TCSI Corp.+............................................... 42,500 1,296,250
Teledata Communications, Inc. ADR+(1)..................... 80,000 850,000
Teltrend, Inc.+........................................... 30,000 1,365,000
Winstar Communications, Inc.+............................. 40,000 645,000
------------
12,931,875
------------
</TABLE>
<TABLE>
<CAPTION>
SHARES/
PRINCIPAL AMOUNT VALUE
SECURITY DESCRIPTION (IN THOUSANDS) (NOTE 2)
<S> <C> <C>
TRANSPORTATION--0.4%
Eagle USA Airfreight,Inc.+...................... 30,000 $ 832,500
------------
TOTAL COMMON STOCK
(cost $132,378,067)............................. 165,217,468
------------
WARRANTS--0.0%+
TELECOMMUNICATIONS--0.0%
Nexus Telecommunication Systems Ltd. ........... 100,000 100,000
------------
OPTIONS--0.2%+
TECHNOLOGY INDEX PUT OPTIONS--0.2%
CBOE Technology Index, May/145.................. 20,000 95,000
CBOE Technology Index, May/150.................. 30,000 198,750
------------
TOTAL OPTIONS
(cost $295,250)................................. 293,750
------------
TOTAL INVESTMENT SECURITIES--86.4%
(cost $132,673,317)............................. 165,611,218
------------
REPURCHASE AGREEMENT--11.5%
Joint Repurchase Agreement
Account (Note 3)
(cost $22,066,000).............................. $ 22,066 22,066,000
------------
TOTAL INVESTMENTS--
(cost $154,739,317)............................. 97.9% 187,677,218
Other assets less liabilities.................... 2.1 4,087,521
----
------------
NET ASSETS-- 100.0% $191,764,739
===== ============
</TABLE>
- -------
+ Non-income producing security
(1) ADR ("American Depositary Receipt")
(2) At March 31, 1996 the fund held a restricted security amounting to 0.1% of
net assets. The fund will not bear any costs, including those involved in
registration under the Securities Act of 1933, in connection with the
disposition of the security.
<TABLE>
<CAPTION>
VALUATION
DATE OF UNIT AS OF
DESCRIPTION ACQUISITION COST MARCH 31, 1996
----------- ----------- ----- --------------
<S> <C> <C> <C>
Innovus Corp. 3/21/95 $3.50 $3.50
</TABLE>
(3) Fair valued security, see Note 2.
See Notes to Financial Statements
21
<PAGE>
SUNAMERICA GLOBAL BALANCED FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- -------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK--69.2%
DOMESTIC EQUITY--15.6%
AEROSPACE & MILITARY TECHNOLOGY--0.4%
Boeing Co..................................................... 1,000 $ 86,625
--------
APPAREL & TEXTILES--0.2%
Warnaco Group, Inc. .......................................... 2,000 48,250
--------
AUTOMOTIVE--0.3%
Ford Motors Co. .............................................. 2,500 85,938
--------
BANKS--0.6%
Chemical Banking Corp. ....................................... 1,000 70,500
Citicorp...................................................... 1,000 80,000
--------
150,500
--------
BROADCASTING & MEDIA--0.1%
Chancellor Broadcasting Corp.+................................ 1,000 22,000
--------
CHEMICALS--1.5%
du Pont (E.I.) de Nemours & Co. .............................. 2,000 166,000
Union Carbide Corp............................................ 4,000 198,500
--------
364,500
--------
COMMUNICATION EQUIPMENT--0.6%
Motorola, Inc................................................. 850 45,050
Tellabs, Inc.+................................................ 2,000 96,750
--------
141,800
--------
CONGLOMERATE--1.2%
AlliedSignal, Inc............................................. 2,000 118,250
General Electric Co........................................... 800 62,300
United Technologies Corp. .................................... 1,000 112,250
--------
292,800
--------
DEPARTMENT STORES--0.3%
Woolworth Corp. .............................................. 5,000 78,125
--------
ELECTRONICS--0.1%
Integrated Measurement Systems, Inc.+......................... 2,000 31,250
--------
ENERGY SERVICES--0.3%
Baker Hughes, Inc. ........................................... 2,000 58,500
Belco Oil & Gas Corp.+........................................ 1,000 22,750
--------
81,250
--------
ENERGY SOURCES--0.3%
Burlington Resources, Inc. ................................... 2,000 74,250
Suncor, Inc. ................................................. 900 11,551
--------
85,801
--------
FOOD, BEVERAGE & TOBACCO--0.1%
Hart Brewing, Inc.+........................................... 1,500 21,750
--------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
HEALTH SERVICES--0.8%
Humana, Inc.+................................................. 1,000 $ 25,125
St. Jude Medical, Inc......................................... 1,500 55,969
United Healthcare Corp........................................ 1,800 110,700
--------
191,794
--------
HOUSEHOLD PRODUCTS--0.3%
Eastman Kodak Co.............................................. 1,050 74,550
--------
INSURANCE--0.4%
Guarantee Life Cos., Inc.+.................................... 2,500 38,437
Highlands Insurance Group, Inc.+.............................. 120 2,370
Lincoln National Corp. ....................................... 1,000 50,750
--------
91,557
--------
LEISURE & TOURISM--0.4%
Penske Motorsports, Inc.+..................................... 500 18,625
Red Roof Inn's Inc.+.......................................... 1,000 14,875
Sun International Hotels Ltd.+................................ 2,000 72,000
--------
105,500
--------
MACHINERY--0.6%
Caterpillar, Inc. ............................................ 2,000 136,000
--------
MEDICAL PRODUCTS--1.5%
Guidant Corp.................................................. 1,000 54,125
Johnson & Johnson Co. ........................................ 2,000 184,500
Medtronic, Inc................................................ 2,000 119,250
Vocaltec Ltd.+................................................ 1,000 12,000
--------
369,875
--------
PHARMACEUTICALS--3.9%
Abbott Laboratories........................................... 2,000 81,500
Lilly (Eli) & Co.............................................. 2,800 182,000
Merck & Co., Inc.............................................. 2,000 124,500
Pfizer, Inc................................................... 1,200 80,400
Pharmaceutical Product Development, Inc.+..................... 2,500 88,125
Schering-Plough Corp.......................................... 3,200 186,000
Warner-Lambert Co............................................. 2,000 206,500
--------
949,025
--------
POLLUTION CONTROL--0.2%
Allied Waste Industries, Inc.+................................ 5,000 45,625
--------
SOFTWARE--1.1%
Documentum, Inc.+............................................. 2,000 70,500
Engineering Animation, Inc.+.................................. 1,000 20,875
Forte Software, Inc.+......................................... 500 20,250
Individual, Inc.+............................................. 1,000 15,250
Indus Group, Inc.+............................................ 1,000 19,500
Informix Corp.+............................................... 2,000 52,750
Raptor Systems, Inc.+......................................... 1,000 29,875
Sterling Commerce, Inc.+...................................... 1,000 30,750
--------
259,750
--------
</TABLE>
22
<PAGE>
SUNAMERICA GLOBAL BALANCED FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
DOMESTIC EQUITY (CONTINUED)
TELECOMMUNICATIONS--0.4%
AT&T Corp.................................................... 1,500 $ 91,875
Wireless One, Inc. .......................................... 1,000 16,125
----------
108,000
----------
TOTAL DOMESTIC EQUITY
(COST $2,882,500)............................................ 3,822,265
----------
FOREIGN EQUITY--53.6%
AEROSPACE & MILITARY TECHNOLOGY--0.7%
Mitsubishi Heavy Industrial Ltd. (Japan)..................... 20,000 172,751
----------
APPAREL & TEXTILES--0.7%
Adidas AG (Germany).......................................... 1,700 124,365
Marzotto & Figli SpA (Italy)................................. 5,000 36,523
----------
160,888
----------
AUTOMOTIVE--3.5%
Autoliv AB (Sweden).......................................... 2,200 112,359
Bridgestone Corp. (Japan).................................... 10,000 167,329
Honda Motor Co., Ltd. (Japan)................................ 12,000 261,370
Nokian Tyres (Finland)....................................... 10,000 118,698
SA D'Ieteren NV (Belgium).................................... 515 54,492
Toyota Motor Corp. (Japan)................................... 6,000 132,367
----------
846,615
----------
BANKS--5.8%
Banco de Credito (Peru)...................................... 18,000 29,847
Banco Intercontinental Espanol (Spain)....................... 350 35,249
Banco Osorno Y La Union ADR(1) (Chile)....................... 800 12,400
Banco Totta & Acores (Portugal).............................. 2,500 48,682
Bangkok Bank PCL (Thailand).................................. 1,900 25,737
Development Bank of Singapore (Singapore).................... 3,000 36,869
Generale de Banque Belge Pour l'Etranger SA (Belgium)........ 185 65,859
HSBC Holdings PLC (Hong Kong)................................ 6,000 90,380
Industrial Bank of Japan Ltd. (Japan)........................ 8,000 220,612
Mitsubishi Bank Ltd. (Japan)................................. 12,600 266,193
Mitsubishi Trust & Banking Corp. (Japan)..................... 15,000 238,373
National Westminster Bank PLC (United Kingdom)............... 15,000 145,490
Overseas Chinese Banking Corp., Ltd. (Singapore)............. 4,000 53,705
Siam Commercial Bank Co., Ltd. (Thailand).................... 3,700 55,394
Societe Generale (France).................................... 450 50,036
Toronto-Dominion Bank (Canada)............................... 2,500 43,317
----------
1,418,143
----------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
BROADCASTING & MEDIA--0.1%
Singapore Press Holdings Ltd. (Singapore).................... 1,000 $ 19,962
--------
CHEMICALS--2.5%
Degussa AG (Germany)......................................... 340 124,365
Laporte PLC (United Kingdom)................................. 5,000 53,686
Metacorp Bhd (Malaysia)...................................... 31,000 94,960
Mitsubishi Chemical Corp. (Japan)............................ 28,000 147,885
Sekisui Chemical Co., Ltd. (Japan)........................... 15,000 196,308
--------
617,204
--------
COMMUNICATION EQUIPMENT--0.4%
Ericsson (L.M.) Telephone Co. Class B ADR(1) (Brazil)........ 4,000 85,500
--------
COMPUTERS & BUSINESS EQUIPMENT--3.6%
Canon, Inc. (Japan).......................................... 10,000 190,699
Getronics NV (Netherlands)................................... 2,400 174,033
Newbridge Networks Corp. ADR+(1) (Canada).................... 1,000 56,250
Ricoh Co. (Japan)............................................ 15,000 161,253
Strafor Facom SA (France).................................... 1,200 86,681
Tokyo Electron Ltd. (Japan).................................. 5,000 170,600
Videologic Group PLC (United Kingdom)........................ 43,283 42,939
--------
882,455
--------
CONGLOMERATE--1.7%
BTR PLC (United Kingdom)..................................... 30,000 144,689
Granite Industries Bhd (Malaysia)............................ 17,000 29,431
Hanson PLC (United Kingdom).................................. 25,000 73,069
Nissho Iwai Corp. (Japan).................................... 30,000 153,120
Renong Bhd (Malaysia)........................................ 14,000 22,798
--------
423,107
--------
CONSTRUCTION & HOUSING--3.2%
Glywed International PLC (United Kingdom).................... 25,000 136,600
Henry Walker Group Ltd. (Australia).......................... 46,492 69,754
Kajima Corp. (Japan)......................................... 20,000 215,003
Keppel Corp. Ltd. (Singapore)................................ 2,000 18,186
Koninklijke Volker Stevin (Netherlands)...................... 500 33,836
Nishimatsu Construction (Japan).............................. 20,000 228,091
Pioneer International Ltd. (Australia)....................... 30,000 89,552
--------
791,022
--------
CONSTRUCTION MATERIALS--2.6%
Grafton Group PLC (Ireland).................................. 10,000 83,465
Hunter Douglas NV (Netherlands).............................. 1,442 97,757
Lion Land Bhd (Malaysia)..................................... 57,000 56,324
Marley PLC (United Kingdom).................................. 60,000 112,637
Plettac AG (Germany)......................................... 300 65,840
Schneider SA (France)........................................ 4,000 177,111
Southeast Asia Cement (Philippines).......................... 400,000 51,184
--------
644,318
--------
</TABLE>
23
<PAGE>
SUNAMERICA GLOBAL BALANCED FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
FOREIGN EQUITY (CONTINUED)
ELECTRICAL EQUIPMENT--0.4%
Internatio-Muller NV (Netherlands)......................... 1,300 $ 105,756
---------
ELECTRONICS--5.5%
Advantest Corp. (Japan).................................... 4,400 198,252
Electric & Eltek International Co., Ltd. (Singapore)....... 40,000 113,600
Hoganas AG (Sweden)........................................ 6,000 182,872
NEC Corp. (Japan).......................................... 15,000 173,872
Pressac Holdings PLC (United Kingdom)...................... 45,000 114,698
Rohm Co. (Japan)........................................... 15,000 171,068
Samsung Electronics Co., Ltd. GDR*(2) (Korea).............. 44 2,530
Samsung Electronics Co., Ltd. GDS*(3) (Korea).............. 1,690 59,167
Siemens AG (Germany)....................................... 220 121,080
Telecomunic Brasileiras SA (Brazil)........................ 1,000,000 39,579
Ushio, Inc. (Japan)........................................ 15,000 164,057
---------
1,340,775
---------
ENERGY SERVICES--0.4%
Lyonnaise des Eaux-Dumez (France).......................... 500 46,760
Schlumberger Ltd. ADR(1) (France).......................... 700 55,387
---------
102,147
---------
ENERGY SOURCES--0.1%
Crestar Energy, Inc. (Canada).............................. 600 10,616
Renaissance Energy Ltd. (Canada)........................... 600 15,732
---------
26,348
---------
ENTERTAINMENT PRODUCTS--1.0%
Bluebird Toys PLC (United Kingdom)......................... 30,000 128,205
RBI Holdings Ltd. (Bermuda)................................ 800,000 106,543
---------
234,748
---------
FINANCIAL SERVICES--1.4%
Hutchison Whampoa (Hong Kong).............................. 10,000 62,839
National Finance & Securities Co., Ltd. (Thailand)......... 10,000 62,579
Nomura Securities International, Inc. (Japan).............. 10,000 219,678
Philippine Savings Bank (Philippines)...................... 1,733 3,409
---------
348,505
---------
FOOD, BEVERAGE & TOBACCO--2.2%
Allied Domecq PLC (United Kindgom)......................... 20,000 149,878
Kirin Brewery Co., Ltd. (Japan)............................ 14,000 168,825
Koninklijke Bols Wessanen NV (Netherlands)................. 7,250 140,866
Nestle SA (Switzerland).................................... 50 56,415
Seagram Ltd. (Canada)...................................... 800 25,889
---------
541,873
---------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
FOREST PRODUCTS--1.7%
Fletcher Challenge Ltd. (Canada)............................. 1,000 $ 13,660
Jefferson Smurfit Group (Ireland)............................ 50,000 122,482
Maderas Y Sinteticos SA ADR(1) (Chile)....................... 1,900 33,725
New Oji Paper Co., Ltd. (Japan).............................. 15,000 136,714
Waddington (John) PLC (United Kingdom)....................... 30,000 101,190
West Fraser Timber Co., Ltd. (Canada)........................ 400 8,984
--------
416,755
--------
INSURANCE--1.9%
Legal & General Group PLC (United Kindgom)................... 10,000 104,014
RAS SpA (Italy).............................................. 8,800 85,744
Tokio Marine & Fire Insurance Co., Ltd. (Japan).............. 15,000 194,905
Zurich Versicherun (Switzerland)............................. 275 79,074
--------
463,737
--------
LEISURE & TOURISM--1.8%
Airtours PLC (United Kingdom)................................ 17,000 119,353
Manchester United PLC
(United Kingdom)............................................ 25,000 110,653
Salomon SA (France).......................................... 100 64,332
Stanley Leisure PLC
(United Kingdom)............................................ 20,000 138,889
--------
433,227
--------
MACHINERY--0.6%
Komatsu Ltd. (Japan)......................................... 15,000 133,629
--------
MANUFACTURING--0.6%
Bombardier, Inc. (Canada).................................... 1,100 16,236
Graystone (United Kingdom)................................... 500,000 116,377
Hanjaya Mandala Sampoerna (Indonesia)........................ 1,750 18,282
--------
150,895
--------
METALS & MINING--3.1%
Barrick Gold Corp. (Canada).................................. 690 21,001
Cameco Corp. (Canada)........................................ 300 15,842
Clutha Ltd.(5) (Australia)................................... 120,000 938
Cominco Ltd. (China)......................................... 240 5,632
CRA Ltd. (Australia)......................................... 5,375 80,434
Diamond Fields Resources, Inc.
(Canada).................................................... 400 11,844
Inco Ltd. (Canada)........................................... 100 3,154
IPSCO, Inc. (China).......................................... 700 16,813
M.I.M. Holdings Ltd. (Australia)............................. 50,000 72,283
Nippon Steel Corp. (Japan)................................... 40,000 137,602
Sumitomo Metal Mining Co., Ltd.
(Japan)..................................................... 20,000 192,568
Western Mining Corp. Holdings Ltd. ADS(4) (Australia)........ 30,000 198,328
--------
756,439
--------
</TABLE>
24
<PAGE>
SUNAMERICA GLOBAL BALANCED FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
FOREIGN EQUITY (CONTINUED)
PHARMACEUTICALS--2.9%
Glaxo Holdings PLC (United Kingdom)........................ 10,000 $ 125,458
Glaxo Holdings PLC ADR(1) (United Kingdom)................. 1,000 25,125
Kissei Pharmaceutical Co. (Japan).......................... 4,400 131,619
Merck KGAA (Germany)....................................... 2,800 121,289
Sanyo Co., Ltd. (Japan).................................... 5,000 114,513
Smithkline Beecham PLC (United Kingdom).................... 10,000 100,275
Smithkline Beecham PLC ADR(1) (United Kingdom)............. 1,500 77,250
-----------
695,529
-----------
POLLUTION CONTROL--0.2%
Eaux (cie Generale) (France)............................... 500 51,128
-----------
REAL ESTATE COMPANIES--1.5%
Cheung Kong Holdings Ltd. (Hong Kong)...................... 8,000 56,892
Mitsubishi Estate Co., Ltd. (Japan)........................ 15,000 206,123
Sun Hung Kai Properties Ltd. (Hong Kong)................... 11,000 100,271
-----------
363,286
-----------
TELECOMMUNICATIONS--2.1%
BCE, Inc. (Canada)......................................... 800 28,310
Cable & Wireless PLC (United Kingdom)...................... 20,000 162,698
DDI Corp. (Japan).......................................... 12 91,423
Nippon Telegraph & Telecommunications Corp. (Japan)........ 12 87,721
Northern Telecom Ltd. (China).............................. 300 14,274
P.T. Indonesian Satellite Corp. ADR(1) (Indonesia)......... 1,000 34,125
Vodafone Group PLC ADR(1) (United Kingdom)................. 2,500 93,750
-----------
512,301
-----------
TRANSPORTATION--0.1%
Nedlloyd Groep NV (Netherlands)............................ 1,300 27,147
-----------
UTILITIES--1.3%
Cogeneration PCL (Thailand)................................ 15,000 53,470
CPT Telefonica de Peru (Peru).............................. 13,500 27,838
Electricity Generating PLC (Thailand)...................... 10,000 30,497
Transcanada Pipelines Ltd. (China)......................... 1,400 19,509
Veba AG (Germany).......................................... 4,000 194,405
-----------
325,719
-----------
TOTAL FOREIGN EQUITY
(cost $12,241,565)......................................... 13,091,909
-----------
TOTAL COMMON STOCK
(cost $15,124,065)......................................... 16,914,174
-----------
</TABLE>
<TABLE>
<CAPTION>
SHARES/
PRINCIPAL AMOUNT
(DENOMINATED IN
LOCAL CURRENCY) VALUE
SECURITY DESCRIPTION (IN THOUSANDS) (NOTE 2)
<S> <C> <C>
PREFERRED STOCK--0.3%
ENERGY SOURCES--0.2%
Cemig Cia Energy MG (Brazil)....................... 1,650,000 $ 46,265
---------
HOUSEHOLD PRODUCTS--0.1%
Friedrich Grohe AG (Germany)....................... 90 22,160
---------
TOTAL PREFERRED STOCK
(cost $64,605)..................................... 68,425
---------
WARRANTS--0.7%+
BANKS--0.2%
Credit Lyonnais.................................... 1,000,000 56,245
---------
FINANCIAL SERVICES--0.5%
Affin Holdings Bhd................................. 137,000 128,878
---------
TOTAL WARRANTS
(cost $168,072).................................... 185,123
---------
OPTIONS--0.0%+
FOREIGN CURRENCY CALL OPTIONS--0.0%
French Francs, Apr/5.05 ...........................
(cost $4,636)...................................... 6 2,537
---------
FOREIGN BONDS--15.5%
Commonwealth of Australia
7.50% due 7/15/05 ................................. 100 71,606
Federal Republic of Germany
5.88% due 5/15/00 ................................. 300 208,799
6.75% due 7/15/04.................................. 300 208,738
7.13% due 12/20/02................................. 400 287,557
7.38% due 1/03/05.................................. 400 288,099
Government of Canada
7.50% due 9/01/00 ................................. 200 149,380
Government of France
7.00% due 11/12/99 ................................ 700 146,382
Government of Spain
10.00% due 2/28/05 ................................ 10,000 81,860
10.15% due 1/13/06................................. 50,000 412,605
Japan Development Bank
6.50% due 9/20/01 ................................. 20,000 224,800
Kingdom of Belgium
6.50% due 3/31/05 ................................. 4,000 129,978
Kingdom of Denmark
9.00% due 11/15/00 ................................ 1,000 194,404
Kingdom of Sweden
10.25% due 5/05/03 ................................ 1,500 247,998
13.00% due 6/15/01................................. 1,000 180,807
Republic of Italy
10.50% due 11/01/00 ............................... 400,000 258,226
Treuhandanstalt (Germany)
6.13% due 6/25/98 ................................. 100 70,541
United Kingdom Treasury
8.50% due 12/07/05 ................................ 300 468,607
9.00% due 3/03/00 ................................. 100 160,352
---------
TOTAL FOREIGN BONDS
(cost $3,834,777).................................. 3,790,739
---------
</TABLE>
25
<PAGE>
SUNAMERICA GLOBAL BALANCED FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
SHARES/
PRINCIPAL AMOUNT VALUE
SECURITY DESCRIPTION (IN THOUSANDS) (NOTE 2)
- ---------------------------------------------------------------------------------
<S> <C> <C>
U.S. TREASURY NOTES--6.2%
5.25% due 1/31/01......................................... $ 100 $ 96,562
6.13% due 9/30/00......................................... 150 150,024
6.50% due 8/15/05......................................... 500 501,955
7.88% due 11/15/04........................................ 700 767,921
-----------
TOTAL U.S. TREASURY NOTES
(cost $1,465,270)......................................... 1,516,462
-----------
TOTAL INVESTMENT SECURITIES--91.9%
(cost $20,661,425)........................................ 22,477,460
-----------
SHORT-TERM SECURITIES--11.6%
Cayman Island Time Deposit 4.50% due 4/01/96.............. 1,975 1,975,000
State Street Bank Time Deposit 5.56% due 4/01/96.......... 850 850,000
-----------
TOTAL SHORT-TERM SECURITIES
(cost $2,825,000)......................................... 2,825,000
-----------
REPURCHASE AGREEMENT--1.0%
Joint Repurchase Agreement Account (Note 3)
(cost $243,000)........................................... 243 243,000
-----------
TOTAL INVESTMENTS--
(cost $23,729,425)........................................ 104.5% 25,545,460
Liabilities in excess of other assets...................... (4.5) (1,098,987)
----- -----------
NET ASSETS-- 100.0% $24,446,473
===== ===========
</TABLE>
+Non-income producing security
*Resale restricted to qualified institutional buyers
(1)ADR ("American Depositary Receipt")
(2)GDR ("Global Depositary Receipt")
(3)GDS ("Global Depositary Shares")
(4)ADS ("American Depositary Shares")
(5)Fair valued security, see Note 2.
Allocation of net assets by
currency as of March 31, 1996:
U.S. Dollar 24.5%
Japanese Yen 23.2
British
Pound 12.1
Deutsche Mark 7.5
Swedish Krona 3.0
French Franc 2.6
Australian
Dollar 2.4
Spanish
Peseta 2.2
Hong-Kong
Dollar 2.0
Canadian
Dollar 1.8
Netherland
Guilder 1.7
Italian Lira 1.6
Malaysian
Ringgit 1.4
Belgian Franc 1.0
Thailand Baht 0.9
Danish Kroner 0.8
Swiss Franc 0.6
Singapore
Dollar 0.5
Finnish
Markka 0.5
Brazilian
Real 0.4
Irish Pound 0.4
Peruvian New
Sol 0.3
Philippines
Peso 0.2
Portuguese
Escudo 0.2
Indonesian
Rupiah 0.1
See Notes to Financial Statements
26
<PAGE>
SUNAMERICA GROWTH & INCOME FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK--90.6%
AEROSPACE & MILITARY TECHNOLOGY--0.9%
Boeing Co. ................................................. 1,000 $ 86,625
-----------
APPAREL & TEXTILES--2.2%
Mossimo, Inc.+.............................................. 5,000 161,875
Tommy Hilfiger Corp.+....................................... 1,000 45,875
-----------
207,750
-----------
AUTOMOTIVE--1.9%
Chrysler Corp. ............................................. 1,500 93,375
Ford Motor Co. ............................................. 2,500 85,938
-----------
179,313
-----------
BANKS--4.6%
Chemcial Bank Corp. ........................................ 2,000 141,000
First Union Corp. .......................................... 3,000 181,500
Mellon Bank Corp. .......................................... 2,000 110,250
-----------
432,750
-----------
BROADCASTING & MEDIA--1.8%
Readers Digest Association, Inc. ........................... 1,500 70,875
United States Satellite Broadcasing Co. .................... 1,000 32,750
Viacom, Inc. Class B+....................................... 1,500 63,188
-----------
166,813
-----------
BUSINESS SERVICES--1.0%
Service Corp. International................................. 2,000 97,500
-----------
CHEMICALS--8.6%
Cabot Corp. ................................................ 4,000 122,000
Dow Chemical Co. ........................................... 2,000 173,750
du Pont (E.I.) de Nemours & Co. ............................ 1,500 124,500
Hanna (M.A). Co. ........................................... 3,000 104,250
Hercules, Inc. ............................................. 3,000 186,000
Intertape Polymer Group, Inc. ADR(1)........................ 2,500 96,562
-----------
807,062
-----------
COMMUNICATION EQUIPMENT--2.7%
Motorola, Inc............................................... 2,000 106,000
Tellabs, Inc.+.............................................. 3,000 145,125
-----------
251,125
-----------
COMPUTERS & BUSINESS EQUIPMENT--1.4%
3Com Corp.+................................................. 2,000 79,750
Newbridge Networks Corp. ADR(1)............................. 1,000 56,250
-----------
136,000
-----------
CONGLOMERATE--5.8%
AlliedSignal, Inc........................................... 2,500 147,812
General Electric Co. ....................................... 2,000 155,750
ITT Industries, Inc. ....................................... 5,000 127,500
United Technologies Corp. .................................. 1,000 112,250
-----------
543,312
-----------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
<S> <C> <C>
CONSTRUCTION & HOUSING--1.0%
Potash Corp. of Saskatchewan, Inc. ADR(1)................... 1,500 $ 93,750
-----------
DEPARTMENT STORES--2.9%
Federated Department Stores, Inc.+.......................... 3,000 96,750
May Department Stores Co. .................................. 2,000 96,500
Woolworth Corp. ............................................ 5,000 78,125
-----------
271,375
-----------
ELECTRONICS--0.8%
Texas Instruments, Inc. .................................... 1,500 76,313
-----------
ENERGY SERVICES--0.5%
Sonat Offshore Drilling, Inc. .............................. 1,000 51,000
-----------
ENERGY SOURCES--7.2%
Amoco Corp.................................................. 2,000 144,500
Belco Oil & Gas Corp.+...................................... 1,000 22,750
Burlington Resources, Inc. ................................. 2,000 74,250
Mobil Corp. ................................................ 1,500 173,812
Panhandle Eastern Corp. .................................... 6,000 186,750
Vintage Petroleum, Inc. .................................... 4,000 81,500
-----------
683,562
-----------
ENTERTAINMENT PRODUCTS--1.1%
Mattel, Inc. ............................................... 4,000 108,500
-----------
FOOD, BEVERAGE & TOBACCO--4.5%
Coca-Cola Co. .............................................. 500 41,313
Dole Food, Inc. ............................................ 6,500 250,250
Philip Morris Cos., Inc. ................................... 1,500 131,625
-----------
423,188
-----------
FOREST PRODUCTS--5.1%
Boise Cascade Corp. ........................................ 3,500 147,000
Consolidated Papers, Inc. .................................. 2,000 112,500
Kimberly-Clark Corp. ....................................... 3,000 223,500
-----------
483,000
-----------
HEALTH SERVICES--5.6%
Apria Healthcare Group, Inc.+............................... 3,000 95,250
Columbia/HCA Healthcare Corp. .............................. 3,000 173,250
Humana, Inc.+............................................... 5,000 125,625
OrNda Healthcorp+........................................... 1,500 43,125
U.S. HealthCare, Inc. ...................................... 2,000 91,750
-----------
529,000
-----------
HOUSEHOLD PRODUCTS--2.1%
Eastman Kodak Co. .......................................... 1,500 106,500
Gillette Co. ............................................... 1,000 51,750
Procter & Gamble Co. ....................................... 500 42,375
-----------
200,625
-----------
</TABLE>
27
<PAGE>
SUNAMERICA GROWTH & INCOME FUND
PORTFOLIO OF INVESTMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
- -------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
INSURANCE--1.9%
Aetna Life & Casualty Co...................................... 1,000 $ 75,500
Lincoln National Corp. ....................................... 2,000 101,500
--------
177,000
--------
LEISURE & TOURISM--1.9%
Penske Motorsports, Inc.+..................................... 500 18,625
Red Roof Inn's Inc.+.......................................... 6,000 89,250
Sun International Hotels Ltd.+................................ 2,000 72,000
--------
179,875
--------
MEDICAL PRODUCTS--3.0%
Baxter International, Inc..................................... 3,500 158,375
Sola International, Inc.+..................................... 4,000 124,500
--------
282,875
--------
METALS & MINING--0.7%
Aluminum Co. of America....................................... 1,000 62,625
--------
PHARMACEUTICALS--7.8%
Amgen, Inc.+.................................................. 1,500 87,187
Bristol-Myers Squibb Co....................................... 2,000 171,250
Glaxo Holdings PLC ADR(1)..................................... 4,000 100,500
Lilly (Eli) & Co. ............................................ 1,500 97,500
Merck & Co., Inc. ............................................ 2,000 124,500
Warner-Lambert Co. ........................................... 1,500 154,875
--------
735,812
--------
POLLUTION CONTROL--0.4%
Millipore Corp. .............................................. 1,000 38,250
--------
REAL ESTATE INVESTMENT TRUSTS--1.4%
Patriot American Hospitality, Inc.+........................... 5,000 131,875
--------
SOFTWARE--3.8%
Cisco Systems, Inc.+.......................................... 2,000 92,750
Fiserv, Inc.+................................................. 4,000 112,000
Forte Software, Inc.+......................................... 500 20,250
Informix Corp.+............................................... 3,000 79,125
Xylan Corp.+.................................................. 1,000 52,000
--------
356,125
--------
TELECOMMUNICATIONS--2.9%
AT&T Corp..................................................... 3,000 183,750
Frontier Corp. ............................................... 3,000 94,500
--------
278,250
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES/
PRINCIPAL AMOUNT VALUE
SECURITY DESCRIPTION (IN THOUSANDS) (NOTE 2)
<S> <C> <C>
TELEPHONE--2.4%
Bell Atlantic Corp. .............................. 1,500 $ 92,625
GTE Corp.......................................... 3,000 131,625
----------
224,250
----------
TRANSPORTATION--0.9%
Canadian National Railway Co. ADR(1).............. 5,000 86,250
----------
UTILITIES--1.8%
Baltimore Gas & Electric Co. ..................... 3,000 82,875
General Public Utilities Corp..................... 2,500 82,500
----------
165,375
----------
TOTAL COMMON STOCK
(cost $7,824,990)................................. 8,547,125
----------
BONDS & NOTES--0.6%
FOREST PRODUCTS--0.6%
Stone Container Corp.
11.88% due 12/01/98
(cost $51,085)................................... $ 50 52,250
----------
TOTAL INVESTMENT SECURITIES--91.2%
(cost $7,876,075)................................. 8,599,375
----------
REPURCHASE AGREEMENT--7.9%
Joint Repurchase Agreement
Account (Note 3) (cost $747,000)................. 747 747,000
----------
TOTAL INVESTMENTS--
(cost $8,623,075)................................. 99.1% 9,346,375
Other assets less liabilities...................... 0.9 84,091
------ ----------
NET ASSETS-- 100.0% $9,430,466
====== ==========
</TABLE>
- --------
+ Non-income producing security
(1) ADR ("American Depositary Receipt")
See Notes to Financial Statements
28
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited)
Note 1. Organization
SunAmerica Equity Funds is an open-end diversified management investment
company organized as a Massachusetts business trust (the "Trust" or "Equity
Funds") on June 16, 1986. It currently consists of six different investment
funds (each, a "Fund" and collectively, the "Funds"). Each Fund is a
separate series of the Trust with a distinct investment objective and/or
strategy. Each Fund is advised and/or managed by SunAmerica Asset
Management Corp. (the "Adviser" or "SAAMCo"). An investor may invest in one
or more of the following Funds: SunAmerica Balanced Assets Fund ("Balanced
Assets Fund"), SunAmerica Blue Chip Growth Fund ("Blue Chip Growth Fund"),
SunAmerica Mid-Cap Growth Fund ("Mid-Cap Growth Fund"), SunAmerica Small
Company Growth Fund ("Small Company Growth Fund"), SunAmerica Global
Balanced Fund ("Global Balanced Fund") and SunAmerica Growth and Income
Fund ("Growth and Income Fund"). The Funds are considered to be separate
entities for financial and tax reporting purposes. The investment
objectives for each of the Funds are as follows:
Balanced Assets seeks to conserve principal by maintaining at all times a
balanced portfolio of stocks and bonds.
Blue Chip Growth seeks capital appreciation by investing primarily in
equity securities of companies with large market capitalizations.
Mid-Cap Growth seeks capital appreciation by investing primarily in equity
securities of medium-sized companies.
Small Company Growth seeks capital appreciation by investing primarily in
equity securities of small capitalization growth companies.
Global Balanced seeks capital appreciation while conserving principal by
maintaining at all times a balanced portfolio of domestic and foreign
stocks and bonds.
Growth and Income seeks capital appreciation and current income by
investing primarily in common stocks.
Each Fund currently offers two classes of shares. Class A shares are
offered at net asset value per share plus an initial sales charge. Class B
shares are offered without an initial sales charge, although a declining
contingent sales charge may be imposed on redemptions made within six years
of purchase. Additionally, any purchases of Class A shares in excess of
$1,000,000 will be subject to a contingent deferred sales charge on
redemptions made within one year of purchase. Class B shares of each Fund
will convert automatically to Class A shares on the first business day of
the month after seven years from the issuance of such Class B shares and at
such time will be subject to the lower distribution fee applicable to Class
A shares. Each class of shares bears the same voting, dividend, liquidation
and other rights and conditions and each makes distribution and account
maintenance and service fee payments under the distribution plans pursuant
to Rule 12b-1 under the Investment Company Act of 1940 (the "1940 Act"),
except that Class B shares are subject to higher distribution fee rates.
Note 2. Significant Accounting Policies
The following is a summary of the significant accounting policies followed
by the Funds in the preparation of their financial statements:
SECURITY VALUATIONS: Securities that are actively traded in the over-the-
counter market, including listed securities for which the primary market is
believed by the Adviser to be over-the-counter, are
29
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited) -- (continued)
valued at the quoted bid price provided by principal market makers.
Securities listed on the New York Stock Exchange ("NYSE") or other national
securities exchanges, are valued on the basis of the last sale price on the
exchange on which they are primarily traded. If there is no sale on that
day, then securities are valued at the closing bid price on the NYSE or
other primary exchange for that day. However, if the last sale price on the
NYSE is different than the last sale price on any other exchange, the NYSE
price is used. Options traded on national securities exchanges are valued
as of the close of the exchange on which they are traded. Futures and
options traded on commodities exchanges are valued at their last sale price
as of the close of such exchange. The Funds may make use of a pricing
service in the determination of their net asset values. Securities for
which market quotations are not readily available and other assets are
valued at fair value as determined pursuant to procedures adopted in good
faith by the Trustees. Short-term investments which mature in less than 60
days are valued at amortized cost, if their original maturity was 60 days
or less, or by amortizing their value on the 61st day prior to maturity, if
their original term to maturity exceeded 60 days.
REPURCHASE AGREEMENTS: The Funds, along with other affiliated registered
investment companies, transfer uninvested cash balances into a single joint
account, the daily aggregate balance of which is invested in one or more
repurchase agreements collateralized by U.S. Treasury or federal agency
obligations. The Funds' custodian takes possession of the collateral
pledged for investments in repurchase agreements. The underlying collateral
is valued daily on a mark to market basis to ensure that the value,
including accrued interest, is at least equal to the repurchase price. In
the event of default of the obligation to repurchase, a Fund has the right
to liquidate the collateral and apply the proceeds in satisfaction of the
obligation. If the seller defaults and the value of the collateral declines
or if bankruptcy proceedings are commenced with respect to the seller of
the security, realization of the collateral by the Fund may be delayed or
limited.
OPTIONS: The premium paid by a Fund for the purchase of a call or a put
option is included in the Fund's Statement of Assets and Liabilities as an
investment and subsequently marked to market to reflect the current market
value of the option. When a Fund writes a call or a put option, an amount
equal to the premium received by the Fund is included in the Fund's
Statement of Assets and Liabilities as a liability and is subsequently
marked to market to reflect the current market value of the option written.
If an option which the Fund has written either expires on its stipulated
expiration date, or if the Fund enters into a closing purchase transaction,
the Fund realizes a gain (or loss if the cost of a closing purchase
transaction exceeds the premium received when the option was written)
without regard to any unrealized gain or loss on the underlying security,
and the liability related to such options is extinguished. If a call option
which the Fund has written is exercised, the Fund realizes a capital gain
or loss from the sale of the underlying security and the proceeds from such
sale are increased by the premium originally received. If a put option
which the Fund has written is exercised, the amount of the premium
originally received reduces the cost basis of the security which the Fund
purchased upon exercise of the option.
SECURITIES TRANSACTIONS, INVESTMENT INCOME, DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS: Securities transactions are recorded on the first business
day following the trade date. Realized gains and losses on sales of
investments are calculated on the identified cost basis. Interest income is
recorded on the accrual basis; dividend income is recorded on the ex-
dividend date. The Equity Funds, except for the Global Balanced Fund and
the Growth and Income Fund, do not amortize premiums or accrue discounts
except original issue discounts and on interest only securities for which
amortization is required for federal income tax purposes.
30
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited) -- (continued)
Net investment income, other than class specific expenses and realized and
unrealized gains and losses, is allocated daily to each class of shares
based upon the relative net asset value of outstanding shares (of the value
of the dividend-eligible shares, as appropriate) of each class of shares at
the beginning of the day (after adjusting for the current capital shares
activity of the respective class).
Dividends from net investment income are paid semiannually, except for
Balanced Assets Fund and Growth and Income Fund which pay quarterly and
Global Balanced Fund which pays annually. Capital gain distributions, if
any, are paid annually.
INVESTMENT SECURITIES LOANED: During the six months ended March 31, 1996,
Balanced Assets Fund, Mid-Cap Growth Fund and Small Company Growth Fund
participated in securities lending with qualified brokers. In lending
portfolio securities to brokers the Funds receive cash as collateral
against the loaned securities, which must be maintained at not less than
102% of the market value of the loaned securities during the period of the
loan. To the extent income is earned on the cash collateral invested, it is
recorded as interest income. As with other extensions of credit, should the
borrower of the securities fail financially, the Funds may bear the risk of
delay in recovery or may be subject to replacing the loaned securities by
purchasing them with the cash collateral held, which may be less than 100%
of the market value of such securities at the time of replacement.
FOREIGN CURRENCY TRANSACTION: The books and records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into
U.S. dollars at published rates on the following basis:
(i) market value of investment securities, other assets and
liabilities--at the closing rate of exchange.
(ii) purchases and sales of investment securities, income and expenses--
at the rate of exchange prevailing on the respective dates of such
transactions.
Assets and liabilities denominated in foreign currencies and commitments
under forward foreign currency contracts are translated into U.S. dollars
at the mean of the quoted bid and asked prices of such currencies against
the U.S. dollar.
The Fund does not isolate that portion of the results of operations arising
as a result of changes in the foreign exchange rates from the changes in
the market prices of securities held at fiscal year-end. Similarly, the
Fund does not isolate the effect of changes in foreign exchange rates from
the changes in the market prices of portfolio securities sold during the
year.
Realized foreign exchange gains and losses on other assets and liabilities
and change in unrealized foreign exchange gains and losses on other assets
and liabilities include foreign exchange gains and losses from currency
gains or losses between the trade and settlement dates of securities
transactions, the difference between the amounts of interest, dividends and
foreign withholding taxes recorded on the Fund's books and the U.S. dollar
equivalent amounts actually received or paid and changes in the unrealized
foreign exchange gains and losses relating to other assets and liabilities
arising as a result of changes in the exchange rate.
FEDERAL INCOME TAXES: It is the Funds' policy to meet the requirements of
the Internal Revenue Code of 1986, as amended, applicable to regulated
investment companies and to distribute all of their taxable net income to
their shareholders. Therefore, no federal income tax or excise tax
provisions are required.
31
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited) -- (continued)
Global Balanced Fund may be subject to taxes imposed by countries in which
it invests. Such taxes are generally based on either income or gains earned
or repatriated. The Fund accrues such taxes when the related income is
earned.
ORGANIZATIONAL EXPENSES: Costs incurred by SAAMCo in connection with the
organization of Global Balanced Fund and Growth and Income Fund amounted to
$4,347 and $1,383, respectively. These costs are being amortized on a
straight line basis by the Funds over a period not to exceed 60 months from
the date the Funds commenced operations.
EXPENSES: Expenses common to all Funds, not directly related to individual
Funds, are allocated among the Equity Funds based upon their relative net
asset values.
USE OF ESTIMATES IN FINANCIAL STATEMENT PREPARATION: The preparation of
financial statements in accordance with generally accepted accounting
principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements.
Actual results could differ from these estimates.
STATEMENT OF POSITION 93-2: As required by Statement of Position 93-2,
Determination, Disclosure, and Financial Statement Presentation of Income,
Capital Gain, and Return of Capital Distributions by Investment Companies,
permanent book-tax differences relating to shareholder distributions have
been reclassified. Net investment income/loss, net realized gain/loss, and
net assets are not affected. The following table discloses the year ending
September 30, 1995 reclassifications between accumulated undistributed net
investment income/loss and accumulated undistributed net realized gain/loss
on investments.
<TABLE>
<CAPTION>
ACCUMULATED ACCUMULATED
UNDISTRIBUTED UNDISTRIBUTED PAID
NET REALIZED NET INVESTMENT IN
GAIN/LOSS INCOME/LOSS CAPITAL
------------- -------------- -------
<S> <C> <C> <C>
Balanced Assets Fund.................... $ 0 $ 0 $ 0
Blue Chip Growth Fund................... (42,924) 42,924 0
Mid-Cap Growth Fund..................... (237,498) 237,498 0
Small Company Growth Fund............... (587,404) 587,404 0
Global Balanced Fund.................... (565,991) 565,991 0
Growth and Income Fund.................. 0 0 0
</TABLE>
Note 3. Joint Repurchase Agreement Account
As of March 31, 1996, Balanced Assets Fund, Mid-Cap Growth Fund, Small
Company Growth Fund, and Growth and Income Fund had a 7.7%, 2.0%, 20.5% and
0.7% undivided interest, respectively, which represented $8,278,000,
$2,106,000, $22,066,000 and $747,000, respectively, in principal amount in
a joint repurchase agreement with Chemical Securities, Inc. In addition,
the Blue Chip Growth Fund and the Global Balanced Fund had a 3.5% and 0.2%
undivided interest which represented $4,095,000 and $243,000, respectively,
in principal amount in a joint repurchase agreement with Yamaichi
International, Inc. As of such date, the cash repurchase agreement in the
joint account and the collateral therefore were as follows:
32
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS --March 31, 1996 (unaudited) -- (continued)
Chemical Securities, Inc. Repurchase Agreement, 5.35% dated 3/29/96, in the
principal amount of $107,576,000 repurchase price $107,623,961 due 4/01/96
collateralized by $50,000,000 U.S. Treasury Bill 5.07% due 10/17/96,
$5,000,000 U.S. Treasury Bill 5.07% due 10/17/96 and $12,815,000 U.S.
Treasury Bill 5.00% due 6/27/96, approximately aggregate value
$109,773,405.
Yamaichi International, Inc. Repurchase Agreement, 5.45% dated 3/29/96, in
the principal amount of $116,221,000 repurchase price $116,273,784 due
4/01/96 collateralized by $12,385,000 U.S. Treasury Bond 8.50% due 2/15/20,
$20,850,000 U.S. Treasury Bond 9.875% due 11/15/15, $12,500,000 U.S.
Treasury Bond 12.00% due 8/15/13, $20,000,000 U.S. Treasury Note 7.625% due
2/15/07, $19,430,000 U.S. Treasury Bill 5.33% due 4/18/96 and $15,865,000
U.S. Treasury Note 6.625% due 3/31/97, approximate aggregate value
$118,551,493.
Note 4. Investment Advisory and Management Agreement, Distribution Agreement
and Service Agreement
The Trust, on behalf of each Fund, has an Investment Advisory and
Management Agreement (the "Agreement") with SAAMCo (the "Adviser"), an
indirect wholly-owned subsidiary of SunAmerica Inc. Under the Agreement,
SAAMCo provides continuous supervision of a Fund's portfolio and
administers its corporate affairs, subject to general review by the
Trustees. In connection therewith, SAAMCo furnishes the Funds with office
facilities, maintains certain of the Fund's books and records, and pays the
salaries and expenses of all personnel, including officers of the Funds who
are employees of SAAMCo and its affiliates. The investment advisory and
management fee to SAAMCo with respect to each Fund (other than the Global
Balanced Fund) is computed daily and payable monthly, at an annual rate of
.75% of a Fund's average daily net assets up to $350 million, .70% of the
next $350 million, and .65% thereafter. The Global Balanced Fund pays the
Adviser a fee, payable monthly, computed daily at the annual rate of 1.00%
on the first $350 million of the Fund's average daily net assets, .90% on
the next $350 million of net assets and .85% on net assets over $700
million. For the six months ended March 31, 1996, SAAMCo earned fees in the
amounts stated on the Statement of Operations, of which SAAMCo agreed to
waive $46,274 and $28,374 on the Global Balanced Fund and Growth and Income
Fund, respectively. In addition to the aforementioned, SAAMCo, on behalf of
SunAmerica Global Balanced Fund, has entered into Sub-Advisory Agreements
with AIG Asset Management, Inc. ("AIGAM") and Goldman Sachs Asset
Management International ("GSAM") under which AIGAM and GSAM act as sub-
advisers for the Fund.
SAAMCo pays to AIGAM a monthly fee with respect to those net assets of the
Global Balanced Fund actually managed by AIGAM computed based on average
daily net assets at the following annual rates: .50% on the first $50
million of such assets, .40% of the next $100 million of such assets, .30%
on the next $150 million of such assets, and .25% of such assets in excess
of $300 million. Also, from the investment advisory fee the Adviser pays
GSAM a monthly fee with respect to those net assets of the Global Balanced
Fund actually managed by GSAM computed based on average daily net assets,
at the following annual rates: .40% on the first $50 million of such
assets, .30% on the next $100 million of such assets, .25% on the next $100
million of such assets, and .20% of such assets in excess of $250 million.
For the six months ended March 31, 1996, SAAMCo paid AIGAM and GSAM fees of
$31,905 and $12,379, respectively.
33
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited) -- (continued)
SAAMCo has agreed that, in any fiscal year, it will refund or rebate its
management fees to each of the Funds to the extent that the Fund's expenses
(including the fees of SAAMCo and amortization of organizational expenses,
but excluding interest, taxes, brokerage commissions, distribution fees and
other extraordinary expenses) exceed the most restrictive expense
limitation imposed by states where the Fund's shares are sold. The most
restrictive expense limitation is presently believed to be 2 1/2% of the
first $30 million of the Fund's average daily net assets, 2% of the next
$70 million of average net assets and 1 1/2% of such net assets in excess
of $100 million.
For the six months ended March 31, 1996, SAAMCo has agreed to voluntarily
reimburse expenses of $1,912 on Global Balanced Fund Class A and, $12,252
and $11,776 on Growth and Income Fund (Class A, Class B), respectively,
related to both class specific and fund level expenses excluding management
fees and distribution and service maintenance fees which are stated
separately in the Notes.
The Trust, on behalf of each Fund, has a Distribution Agreement with
SunAmerica Capital Services, Inc. ("SACS"), an indirect wholly owned
subsidiary of SunAmerica Inc. Each Fund has adopted a Distribution Plan
(the "Plan") in accordance with the provisions of Rule 12b-1 under the 1940
Act. Rule 12b-1 under the Act permits an investment company directly or
indirectly to pay expenses associated with the distribution of its shares
("distribution expenses") in accordance with a plan adopted by the
investment company's board of trustees and approved by its shareholders.
Pursuant to such rule, the Trustees and the shareholders of each class of
shares of each Fund have adopted Distribution Plans hereinafter referred to
as the "Class A Plan" and the "Class B Plan." In adopting the Class A Plan
and the Class B Plan, the Trustees determined that there was a reasonable
likelihood that each such Plan would benefit the Trust and the shareholders
of the respective class. The sales charge and distribution fees of a
particular class will not be used to subsidize the sale of shares of any
other class.
Under the Class A Plan and Class B Plan, the Distributor receives payments
from a Fund at an annual rate of up to 0.10% and 0.75%, respectively, of
average daily net assets of such Fund's Class A shares to compensate the
Distributor and certain securities firms for providing sales and
promotional activities for distributing that class of shares. The
distribution costs for which the Distributor may be reimbursed out of such
distribution fees include fees paid to broker-dealers that have sold Fund
shares, commissions, and other expenses such as those incurred for sales
literature, prospectus printing and distribution and compensation to
wholesalers. It is possible that in any given year the amount paid to the
Distributor under the Class A Plan or Class B Plan may exceed the
Distributor's distribution costs as described above. The Distribution Plans
provide that each class of shares of each Fund may also pay the Distributor
an account maintenance and service fee up to an annual rate of 0.25% of the
aggregate average daily net assets of such class of shares for payments to
broker-dealers for providing continuing account maintenance. Accordingly,
for the six months ended March 31, 1996, SACS received fees (see Statement
of Operations) based upon the aforementioned rates, (of which $2,870 was
waived on Growth and Income Fund).
34
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS --March 31, 1996 (unaudited) -- (continued)
SACS receives sales charges on each Fund's Class A shares, portions of
which are reallowed to affiliated broker-dealers and non-affiliated broker-
dealers. SACS also receives the proceeds of contingent deferred sales
charges paid by investors in connection with certain redemptions of each
Fund's Class B shares. SACS has advised the Funds that for the six months
ended March 31, 1996 the proceeds received from Class A sales (and paid out
to affiliated and non-affiliated broker-dealers) and Class B redemptions
are as follows:
<TABLE>
<CAPTION>
CLASS A CLASS B
-------------------------------------- -------------------
SALES AFFILIATED NON-AFFILIATED CONTINGENT DEFERRED
CHARGES BROKER-DEALERS BROKER-DEALERS SALES CHARGES
-------- -------------- -------------- -------------------
<S> <C> <C> <C> <C>
Balanced Assets Fund.... $710,479 $527,144 $ 83,193 $141,175
Blue Chip Growth Fund... 45,434 25,153 13,983 21,430
Mid-Cap Growth Fund..... 95,359 68,421 12,750 6,986
Small Company Growth
Fund................... 717,151 434,219 183,730 44,800
Global Balanced Fund.... 44,296 24,378 14,142 17,979
Growth and Income Fund.. 27,978 21,317 2,708 928
</TABLE>
The Trust has entered into a Service Agreement with SunAmerica Fund
Services, Inc. ("SAFS"), an indirect wholly-owned subsidiary of SunAmerica
Inc. Under the Service Agreement, SAFS performs certain shareholder account
functions by assisting the Funds' transfer agent in connection with the
services that it offers to the shareholders of the Funds. The Service
Agreement permits the Funds to reimburse SAFS for costs incurred in
providing such services which is approved annually by the Trustees. For the
six months ended March 31, 1996, the Funds incurred the following expenses
to reimburse SAFS pursuant to the terms of the Service Agreement.
<TABLE>
<CAPTION>
PAYABLE AT
EXPENSE MARCH 31, 1996
----------------- ---------------
CLASS A CLASS B CLASS A CLASS B
-------- -------- ------- -------
<S> <C> <C> <C> <C>
Balanced Assets Fund...................... $141,674 $182,145 $26,213 $31,668
Blue Chip Growth Fund..................... 48,901 43,954 9,018 7,781
Mid-Cap Growth Fund....................... 41,214 10,611 7,178 2,068
Small Company Growth Fund................. 104,229 74,916 19,970 14,195
Global Balanced Fund...................... 9,685 15,500 1,650 2,791
Growth and Income Fund.................... 4,787 3,536 968 737
</TABLE>
35
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited) -- (continued)
Note 5. Purchases and Sales of Investment Securities
The aggregate cost of purchases and proceeds from sales and maturities of
investments (excluding U.S. Government securities and short-term
investments) during the six months ended March 31, 1996 were as follows:
<TABLE>
<CAPTION>
BALANCED BLUE CHIP MID-CAP SMALL COMPANY GLOBAL GROWTH AND
ASSETS GROWTH GROWTH GROWTH BALANCED INCOME
FUND FUND FUND FUND FUND FUND
------------ ------------ ----------- ------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Aggregate purchases..... $222,590,252 $106,386,126 $70,910,739 $203,281,293 $12,895,923 $9,857,383
------------ ------------ ----------- ------------ ----------- ----------
Aggregate sales......... $208,407,843 $97,580,362 $59,548,281 $170,971,381 $13,419,762 $6,921,478
============ ============ =========== ============ =========== ==========
</TABLE>
Note 6. Portfolio Securities
The cost of securities and the aggregate gross unrealized appreciation and
depreciation of securities at March 31, 1996 were as follows:
<TABLE>
<CAPTION>
BALANCED BLUE CHIP MID-CAP SMALL COMPANY GLOBAL GROWTH AND
ASSETS GROWTH GROWTH GROWTH BALANCED INCOME
FUND FUND FUND FUND FUND FUND
------------ ----------- ----------- ------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Cost.................... $294,215,411 $85,871,931 $43,292,826 $154,739,317 $23,729,425 $8,623,075
============ =========== =========== ============ =========== ==========
Appreciation............ $ 26,835,613 $ 9,779,645 $ 7,869,888 $34,993,691 $ 2,375,424 $ 836,950
Depreciation............ (6,156,866) (3,093,576) (540,301) (2,055,790) (559,389) (113,650)
------------ ----------- ----------- ------------ ----------- ----------
Unrealized appreciation/
depreciation--net...... $ 20,678,747 $ 6,686,069 $ 7,329,587 $32,937,901 $ 1,816,035 $ 723,300
============ =========== =========== ============ =========== ==========
</TABLE>
Capital losses incurred after October 31 within the taxable year are deemed
to arise on the first business day of the Funds' next taxable year.
Accordingly, the Global Balanced Fund incurred and will defer net capital
losses of $1,443,904 to the taxable year ended September 30, 1996. To the
extent these losses are used to offset future gains, it is probable that
the gains so offset will not be distributed.
At March 31, 1996, Global Balanced Fund had net capital loss carryforwards
of $17,364 which are available to the extent provided in regulations to
offset future capital gains and which will expire in 2003. To the extent
that these carryforwards are used to offset future capital gains, it is
probable that the gains so offset will not be distributed.
36
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited) -- (continued)
Note 7. Open Forward Currency Contracts
At March 31, 1996, the Global Balanced Fund engaged in the trading of
forward foreign currency exchange contracts ("forward contracts") in order
to hedge against changes in future foreign exchange rates and enhance
return. Forward contracts involve elements of market risk in excess of the
amount reflected in the Statement of Assets and Liabilities. The Fund bears
the risk of an unfavorable change in the foreign exchange rate underlying
the forward contract. Global Balanced Fund held the following forward
currency contracts at March 31, 1996:
<TABLE>
<CAPTION>
GROSS
CONTRACT IN DELIVERY UNREALIZED
TO DELIVER EXCHANGE FOR DATE APPRECIATION
--------------------- ----------------------- -------- ------------
<S> <C> <C> <C> <C> <C>
BEF 3,467,742 USD 116,551 6/05/96 $ 1,796
USD 1,414,095 DEM 2,087,205 4/04/96 149
DEM 116,197 USD 80,000 4/04/96 1,268
DEM 1,756,728 USD 1,195,866 4/04/96 5,546
DEM 321,558 USD 218,598 4/04/96 718
DEM 13,128 BEF 270,000 9/09/96 7
USD 39,980 ESP 5,000,000 4/23/96 221
ESP 15,798,487 USD 128,151 4/23/96 1,126
USD 234,979 FRF 1,192,050 4/23/96 1,926
FRF 1,564,105 ESP 39,016,599 4/23/96 2,860
FRF 1,550,248 USD 310,000 4/23/96 1,908
FRF 1,900,000 USD 381,373 4/23/96 3,772
GBP 380,835 USD 584,582 4/04/96 3,383
GBP 211,942 USD 324,361 4/04/96 912
GBP 432,778 USD 662,583 8/14/96 3,410
JPY 28,337,040 USD 270,000 4/17/96 4,444
JPY 29,590,000 USD 284,882 4/17/96 7,584
JPY 400,000,000 USD 3,795,066 6/12/96 17,753
*DEM 222,572 GBP 100,000 4/04/96 1,862
*JPY 26,800,000 USD 258,021 4/17/96 7,495
*USD 409,903 DKK 2,340,052 4/23/96 596
*ESP 40,890,794 USD 331,690 4/23/96 2,231
*USD 328,618 ESP 40,890,794 4/23/96 841
*CAD 430,880 USD 320,000 6/18/96 3,990
*USD 311,712 CAD 430,880 6/18/96 4,298
-------
80,096
-------
</TABLE>
37
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
GROSS
CONTRACT IN DELIVERY UNREALIZED
TO DELIVER EXCHANGE FOR DATE DEPRECIATION
--------------------- ----------------------- -------- ------------
<S> <C> <C> <C> <C> <C>
AUD 374,008 USD 280,517 4/30/96 $(11,231)
BEF 9,584,224 DEM 464,622 9/09/96 (1,188)
CAD 216,167 USD 157,275 5/10/96 (1,341)
GBP 50,000 DEM 109,950 4/04/96 (1,806)
ESP 33,420,000 DEM 394,150 4/23/96 (1,379)
DEM 2,087,205 USD 1,418,873 6/04/96 (507)
DEM 2,000,000 USD 1,351,351 6/12/96 (9,305)
DKK 1,211,537 USD 211,150 4/22/96 (1,548)
ESP 51,752,637 USD 415,604 4/23/96 (504)
USD 320,620 GBP 210,000 4/04/96 (135)
USD 664,000 GBP 432,778 4/04/96 (3,531)
ITL 421,970,840 USD 264,749 4/22/96 (3,193)
SEK 1,780,000 USD 254,039 5/14/96 (12,040)
SEK 1,294,686 USD 189,392 5/14/96 (4,140)
*GBP 100,000 DEM 219,900 4/04/96 (3,672)
*USD 251,553 JPY 26,800,000 4/17/96 (1,028)
*DKK 120,000 USD 20,914 4/22/96 (137)
*USD 21,067 DKK 120,000 4/22/96 (16)
*DKK 2,340,052 USD 407,831 4/23/96 (2,668)
--------
(59,369)
--------
Net Appreciation.................................... $ 20,727
========
</TABLE>
*Represents open forward foreign currency contracts and offsetting open
forward foreign currency contracts that do not have additional market risk
but have continued counterparty settlement risk.
AUD--Austrailian Dollar DKK--Danish Kroner ITL--Italian Lira
BEF--Belgian Franc ESP--Spanish Peseta JPY--Japanese Yen
CAD--Canadian Dollar FRF--French Franc SEK--Swedish Krona
DEM--Deutsche Mark GBP--Great Britian Pound USD--United States
Dollar
38
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited) -- (continued)
Note 8. Capital Share Transactions
Transactions in capital shares of each class of each series were as
follows:
<TABLE>
<CAPTION>
BALANCED ASSETS FUND
--------------------------------------------------------------------------------------------------------
CLASS A CLASS B
-------------------------------------------------- ----------------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 1996 YEAR ENDED MARCH 31, 1996 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 1995 (UNAUDITED) SEPTEMBER 30, 1995
------------------------ ------------------------ ------------------------ --------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------ ---------- ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold..... 1,971,604 $ 32,005,963 4,667,503 $ 71,426,588 1,747,642 $ 28,438,252 3,071,975 $ 45,998,809
Reinvested
dividends...... 517,446 8,190,047 265,763 3,756,343 641,584 10,144,349 769,696 10,686,782
Shares redeemed. (1,158,134) (18,967,970) (1,193,984) (17,782,121) (1,845,503) (29,944,457) (6,322,402) (95,258,440)
---------- ------------ ---------- ------------ ---------- ------------ ----------- -------------
Net increase
(decrease)..... 1,330,916 $ 21,228,040 3,739,282 $ 57,400,810 543,723 $ 8,638,144 (2,480,731) $(38,572,849)
========== ============ ========== ============ ========== ============ =========== =============
<CAPTION>
BLUE CHIP GROWTH FUND
--------------------------------------------------------------------------------------------------------
CLASS A CLASS B
-------------------------------------------------- ----------------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 1996 YEAR ENDED MARCH 31, 1996 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 1995 (UNAUDITED) SEPTEMBER 30, 1995
------------------------ ------------------------ ------------------------ --------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------ ---------- ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold..... 367,742 $ 6,143,923 2,404,163 $ 37,806,801 2,685,616 $ 44,903,316 8,964,323 $ 134,971,138
Reinvested
dividends...... 285,307 4,510,703 14,956 207,075 276,920 4,310,566 372,862 5,128,338
Shares redeemed. (237,257) (4,001,105) (181,804) (2,884,125) (2,776,855) (46,187,528) (11,706,255) (177,081,024)
---------- ------------ ---------- ------------ ---------- ------------ ----------- -------------
Net increase
(decrease)..... 415,792 $ 6,653,521 2,237,315 $ 35,129,751 185,681 $ 3,026,354 (2,369,070) $ (36,981,548)
========== ============ ========== ============ ========== ============ =========== =============
<CAPTION>
MID-CAP GROWTH FUND
--------------------------------------------------------------------------------------------------------
CLASS A CLASS B
-------------------------------------------------- ----------------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 1996 YEAR ENDED MARCH 31, 1996 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 1995 (UNAUDITED) SEPTEMBER 30, 1995
------------------------ ------------------------ ------------------------ --------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------ ---------- ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold..... 307,650 $ 5,173,644 247,141 $ 3,926,322 1,308,395 $ 22,174,754 4,235,563 $ 62,818,790
Reinvested
dividends...... 262,430 4,235,729 5,781 79,602 66,071 1,049,943 1,748 24,200
Shares redeemed. (336,400) (5,769,647) (521,946) (7,755,976) (1,215,957) (20,737,715) (3,989,374) (59,135,991)
---------- ------------ ---------- ------------ ---------- ------------ ----------- -------------
Net increase
(decrease)..... 233,680 $ 3,639,726 (269,024) $ (3,750,052) 158,509 $ 2,486,982 247,937 $ 3,706,999
========== ============ ========== ============ ========== ============ =========== =============
</TABLE>
39
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited) -- (continued)
<TABLE>
<CAPTION>
SMALL COMPANY GROWTH FUND
---------------------------------------------------------------------------------------------------------
CLASS A CLASS B
--------------------------------------------------- ----------------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 1996 YEAR ENDED MARCH 31, 1996 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 1995 (UNAUDITED) SEPTEMBER 30, 1995
------------------------ ------------------------- ------------------------ --------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------- ---------- ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold..... 3,902,277 $ 89,095,266 6,544,632 $ 130,462,164 3,954,139 $ 90,168,893 9,886,153 $ 196,092,402
Reinvested
dividends...... 725,607 15,399,834 54,753 964,756 543,024 11,321,166 62,016 1,085,149
Shares redeemed. (3,235,422) (74,318,184) (5,262,148) (102,586,803) (3,659,044) (83,254,993) (10,265,178) (202,833,358)
---------- ------------ ---------- ------------- ---------- ------------ ----------- -------------
Net increase
(decrease)..... 1,392,462 $ 30,176,916 1,337,237 $ 28,840,117 838,119 $ 18,235,066 (317,009) $ (5,655,807)
========== ============ ========== ============= ========== ============ =========== =============
<CAPTION>
GLOBAL BALANCED FUND
---------------------------------------------------------------------------------------------------------
CLASS A CLASS B
--------------------------------------------------- ----------------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 1996 YEAR ENDED MARCH 31, 1996 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 1995 (UNAUDITED) SEPTEMBER 30, 1995
------------------------ ------------------------- ------------------------ --------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------- ---------- ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold..... 156,379 $ 1,143,225 750,764 $ 5,173,301 373,042 $ 2,703,795 1,150,637 $ 7,847,490
Reinvested
dividends...... 63,318 449,557 4,067 27,252 93,392 661,224 2,161 14,461
Shares redeemed. (307,635) (2,242,249) (1,342,777) (9,319,908) (292,960) (2,123,114) (1,199,716) (8,126,345)
---------- ------------ ---------- ------------- ---------- ------------ ----------- -------------
Net increase
(decrease)..... (87,938) $ (649,467) (587,946) $ (4,119,355) 173,474 $ 1,241,905 (46,918) $ (264,394)
========== ============ ========== ============= ========== ============ =========== =============
<CAPTION>
GROWTH AND INCOME FUND
---------------------------------------------------------------------------------------------------------
CLASS A CLASS B
--------------------------------------------------- ----------------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 1996 YEAR ENDED MARCH 31, 1996 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 1995 (UNAUDITED) SEPTEMBER 30, 1995
------------------------ ------------------------- ------------------------ --------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------- ---------- ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold..... 130,466 $ 1,166,381 542,589 $ 4,112,191 128,713 $ 1,163,530 301,384 $ 2,380,132
Reinvested
dividends...... 26,805 237,282 25,040 190,918 17,667 156,185 7,758 61,110
Shares redeemed. (23,665) (215,509) (562,875) (4,274,466) (22,462) (202,929) (37,348) (295,806)
---------- ------------ ---------- ------------- ---------- ------------ ----------- -------------
Net increase.... 133,606 $ 1,188,154 4,754 $ 28,643 123,918 $ 1,116,786 271,794 $ 2,145,436
========== ============ ========== ============= ========== ============ =========== =============
</TABLE>
40
<PAGE>
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- March 31, 1996 (unaudited)
Note 9. Commitments and Contingencies
The SunAmerica family of mutual funds may borrow up to $75,000,000 under an
uncommitted line of credit with State Street Bank and Trust Company with
interest payable at the Federal Funds rate plus 100 basis points.
Borrowings under the line of credit will commence when the respective
Fund's cash shortfall exceeds $100,000.
Note 10. Trustees Retirement Plan
The Trustees (and Directors) of the SunAmerica Family of Mutual Funds have
adopted the SunAmerica Disinterested Trustees' and Directors' Retirement
Plan (the "Retirement Plan") effective January 1, 1993 for the unaffiliated
Trustees. The Retirement Plan provides generally that if an unaffiliated
Trustee who has at least 10 years of consecutive service as a Disinterested
Trustee of any of the SunAmerica mutual funds (an "Eligible Trustee")
retires after reaching age 60 but before age 70 or dies while a Trustee,
such person will be eligible to receive a retirement or death benefit from
each SunAmerica mutual fund with respect to which he or she is an Eligible
Trustee. As of each birthday, prior to the 70th birthday, but in no event
for a period greater than 10 years, each Eligible Trustee will be credited
with an amount equal to 50% of his or her regular fees (excluding committee
fees) for services as a Disinterested Trustee of each SunAmerica mutual
fund for the calendar year in which such birthday occurs. In addition, an
amount equal to 8.5% of any amounts credited under the preceding clause
during prior years, is added to each Eligible Trustee's account until such
Eligible Trustee reaches his or her 70th birthday. An Eligible Trustee may
receive any benefits payable under the Retirement Plan, at his or her
election, either in one lump sum or in up to fifteen annual installments.
As of March 31, 1996, Balanced Assets Fund, Blue Chip Growth Fund, Mid-Cap
Growth Fund, Small Company Growth Fund, Global Balanced Fund and Growth and
Income Fund had accrued $9,221, $3,148, $1,574, $4,502, $810 and $150,
respectively, for the Retirement Plan, which is included in accrued
expenses on the Statement of Assets and Liabilities, and for the six months
ended March 31, 1996 expensed $4,102, $1,281, $688, $2,259, $374 and $94,
respectively, for the Retirement Plan, which is included in Trustees' fees
and expenses on the Statement of Operations.
41
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
TRUSTEES INVESTMENT ADVISER
S. James Coppersmith SunAmerica Asset Management Corp.
Samuel M. Eisenstat The SunAmerica Center
Stephen J. Gutman 733 Third Avenue
Peter A. Harbeck New York, NY 10017-3204
Peter McMillan III SUB-ADVISERS
Sebastiano Sterpa AIG Asset Management, Inc. 70 Pine
Street New York, NY 10270
OFFICERS
Peter A. Harbeck, President Goldman Sachs Asset Management
Stanton J. Feeley, Executive Vice President International 95 Broad Street New
Nancy Kelly, Vice President York, NY 10004
Audrey L. Snell, Vice President
Robert M. Zakem, Secretary DISTRIBUTOR
Peter C. Sutton, Treasurer SunAmerica Capital Services, Inc.
Donna M. Handel, Assistant Treasurer The SunAmerica Center
John T. Genoy, Assistant Treasurer 733 Third Avenue
Hilary R. Kastleman, Assistant Secretary New York, NY 10017-3204
Abbe P. Stein, Assistant Secretary
SHAREHOLDER SERVICING AGENT
CUSTODIAN AND TRANSFER AGENT SunAmerica Fund Services, Inc.
State Street Bank & Trust Company The SunAmerica Center
P.O. Box 419572 733 Third Avenue
Kansas City, MO 64141-6572 New York, NY 10017-3204
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
BULK RATE
SUNAMERICA EQUITY FUNDS U.S. POSTAGE
THE SUNAMERICA CENTER PAID
733 THIRD AVENUE Kansas City,
NEW YORK, NY 10017-3204 MO
1-800-858-8850 PERMIT NO.
3657
This report is submitted solely for
the general information of
shareholders of the Fund.
Distribution of this report to
persons other than shareholders of
the Fund is authorized only in
connection with a currently effective
prospectus, setting forth details of
the Fund, which must precede or
accompany this report.
SPONSORED BY:
[LOGO] SunAmerica
Asset Management
EFANN
