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INSURED TAX EXEMPT FUND
EXECUTIVE INVESTORS TRUST
SEMI-ANNUAL REPORT
JUNE 30, 2000
Bond Market Overview
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
Dear Investor:
We are pleased to present this Bond Market Overview for the semi-annual
report for the Executive Investors Insured Tax Exempt Fund for the six-
month period ended June 30, 2000.
The Economy
The U.S. economy, now in its tenth year of expansion, continued its
solid performance during the period, with the gross domestic product
(GDP) growing by 5.0% on an annualized basis. The unemployment rate fell
to 4.0% in June, near a 30-year low. Consumer confidence remained high
as personal income continued to grow. Durable goods orders (for
airplanes, computers, etc.) and industrial production continued to rise.
The rate of inflation began to trend slightly higher, although remaining
benign by historical standards. The consumer price index, a broad
inflation gauge, increased 3.7% during the 12 months ending June 2000,
but only 2.4% excluding the volatile food and energy components. The
primary inflation story was the approximately 45% increase in the price
of oil during the first six months of the year. In the labor market, the
inflationary impact of rising wages was largely offset by the continued
improvement in productivity that has characterized much of the current
economic expansion.
Against this backdrop, the Federal Reserve ("the Fed") continued to
tighten monetary policy based upon its concerns about the pace of
economic growth (fourth quarter 1999 and first quarter 2000 growth
exceeded 6.5%) and the tight labor market. In all, the Fed raised short-
term interest rates three times during the review period, accounting for
a total of 100 basis points (1%).
The Bond Market
The economy's continued good health and the Fed's attempts to cool the
economy produced mixed results for the bond market during the first half
of the year. Short-term interest rates rose with two-year Treasury note
yields increasing from 6.21% at year-end to 6.36% on June 30. The
increase in rates was primarily attributable to the Fed's ongoing
tightening of the money supply. Conversely, long-term interest rates
fell slightly after reaching their highest level since 1997 in January.
The ten-year Treasury note yield dropped from 6.44% at year-end 1999 to
6.03% as of June 30. This rate decline occurred despite the solid
economy and the Fed's actions largely because of the U.S. budget
surplus. Driven by the strong economy of recent years, tax collections
have increased, producing a budget surplus estimated at $211 billion for
2000 and $1.3 trillion over the next ten years. The Federal government's
good fortune has helped shrink the supply of U.S. Treasury debt.
Bond Market Overview (continued)
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
Issuance of new Treasury securities has slowed and the Treasury has
begun buying back debt in the open market. If the economy continues to
steam ahead, some optimistic analysts have predicted that all public
debt (U.S. Treasury and municipal bonds) could be eliminated by 2012.
The decrease in Treasury debt helped trigger an unusual occurrence in
the bond market. Normally, interest rates on bonds with longer
maturities are higher than interest rates on bonds with shorter
maturities due to the former's greater interest rate risk. However, in
recent months, the interest rates on longer maturity Treasury bonds have
fallen below those of shorter maturities, causing the yield curve to
invert. While the Fed has raised short-term rates, long-term Treasury
rates have fallen due to the scarcity of high-quality bonds. However,
the decline in long-term interest rates has been limited to public debt.
In the private debt markets (corporate bonds, mortgage-backed bonds,
etc.), long-term yields have remained high, reflecting the strong
economy and inflation concerns.
Among the different sectors of the bond market, Treasury securities
(particularly long-term debt) provided the highest returns during the
first six months. The municipal bond sector was the second best
performing sector, with new issuance down 22% versus the same period of
1999, as the strong economy helped decrease the need for municipalities
to issue debt. In the mortgage-backed bond sector, investors also
benefited from a decline in issuance as well as an excellent prepayment
environment, as refinancings declined but home sales remained high. In
the investment grade corporate bond sector, the active Fed, "event risk"
(mergers and other actions taken by companies to improve their stock
price), the inverted yield curve, and heavy supply (June was the
heaviest month in the history of corporate bond issuance) converged to
produce disappointing results. However, higher-rated issues fared better
than lower-rated credits. The high yield bond segment posted the weakest
returns in the bond market, due to the factors which adversely affected
the investment grade corporate bond market plus rising default rates and
lack of investor demand due to better returns in other asset classes.
Looking Ahead
Going forward, the Fed may raise interest rates once or twice more in an
effort to slow the economy's momentum. The Fed took no action at its
meeting at the end of June, but maintained a bias to raise rates. For
the equity market, we remain optimistic that solid economic fundamentals
and healthy corporate profits may produce positive returns for the
second half of 2000. In the bond market, it appears that long-term rates
most likely peaked in January. Rates may move somewhat higher from
current levels until the Fed concludes its rate increases. The
conclusion of Fed tightening, coupled with a slowing economy, could
create a catalyst for a bond market rally by the end of the year.
Because it is impossible to predict the future direction of the markets,
even over the short term, there are certain basic investment principles
that we encourage our clients to follow to reduce exposure to risk.*
First, we encourage clients to take a long-term view, and to avoid
trying to time the market. Attempting to time the market is extremely
difficult, even for professional investors. Second, we encourage our
clients to diversify their portfolios among stock funds, bond funds and
money market funds. Third, we encourage our shareholders to follow a
regular investment plan, investing a specific amount of money at defined
intervals. This strategy is known as "dollar cost averaging." It may
help you to avoid getting caught up in the excitement of a rising market
and will reduce the risk of buying at high points.
Of course, no financial plan or program, no matter how well-designed, is
guaranteed to be successful. In addition, nothing eliminates the risk
associated with overall market trends. However, utilizing these various
strategies may help to minimize the risk by reducing the extent to which
an investor may be affected by a decline in any one security or segment
of the market. If you use dollar cost averaging, you should consider
your ability to continue purchases through periods of declining prices.
Thank you for placing your trust in Executive Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/S/ CLARK D. WAGNER
Clark D. Wagner
Chief Investment Officer
Executive Investors Management Company, Inc.
July 31, 2000
* There are a variety of risks associated with investing in mutual
funds. For bond funds, the risks include interest rate risk and credit
risk. Interest rate risk is the risk that bonds will decrease in value
as interest rates rise. As a general matter, longer-term bonds fluctuate
more than shorter-term bonds in reaction to changes in interest rates.
Credit risk is the risk that bonds will decline in value as the result
of a decline in the credit rating of the bonds or the economy as a
whole. You should consult your prospectus for a precise explanation of
the risks associated with your fund.
<TABLE>
<CAPTION>
Portfolio of Investments
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
June 30, 2000
---------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MUNICIPAL BONDS-97.2%
Alabama-1.7%
$250M Coffee Cnty. Public Bldg. Authority, 6.10%, 9/1/2016 $ 258,750 $ 173
---------------------------------------------------------------------------------------------------------
Arizona-1.9%
250M Maricopa County Ind. Dev. Auth. Hosp. Facs. Rev.
(Samaritan Hlth. Svcs.), 7%, 12/1/2016 289,687 194
---------------------------------------------------------------------------------------------------------
California-11.7%
690M Jefferson High Sch. Dist. (San Mateo Cnty.), 6.25%,
2/1/17 757,275 506
400M Pomona School District, 6.55%, 8/1/2029 451,000 301
500M San Francisco City & County Redev. Agy.
(Moscone Ctr.), 6.75%, 7/1/2015 545,625 365
---------------------------------------------------------------------------------------------------------
1,753,900 1,172
---------------------------------------------------------------------------------------------------------
Colorado-2.5%
350M Garfield Pitkin & Eagle Cntys. School District #RE1,
6.60%, 6/15/2004* 375,812 251
---------------------------------------------------------------------------------------------------------
Connecticut-2.0%
275M Connecticut Special Tax Oblig. Rev., 6.10%,
10/1/2004* 291,843 195
---------------------------------------------------------------------------------------------------------
Florida-2.4%
335M Cocoa Water & Sewer Rev., 5.75%, 10/1/2007* 355,518 238
---------------------------------------------------------------------------------------------------------
Illinois-10.9%
500M Chicago Board of Education, 6.25%, 12/1/2012 546,250 365
500M Chicago General Obligation, 6%, 7/1/2005* 534,375 357
500M Illinois Dev. Fin. Auth. (Rockford School #205),
6.55%, 2/1/2009 550,625 368
---------------------------------------------------------------------------------------------------------
1,631,250 1,090
---------------------------------------------------------------------------------------------------------
Maine-1.8%
250M Maine Municipal Bond Bank, 6.50%, 11/1/2014 266,250 178
---------------------------------------------------------------------------------------------------------
Massachusetts-3.5%
500M Massachusetts Bay Transportation Auth.
Gen. Sys. Rev., 5.80%, 3/1/2013 524,375 350
---------------------------------------------------------------------------------------------------------
<CAPTION>
---------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Michigan-7.3%
$ 1,000M Howell Public Schools General Obligation,
Zero Coupon, 5/1/2006* $ 338,750 $ 226
750M Milan Area School District, 5.625%, 5/1/2017 755,625 505
---------------------------------------------------------------------------------------------------------
1,094,375 731
---------------------------------------------------------------------------------------------------------
Missouri-11.5%
200M Liberty Sewer System Rev., 6.15%, 2/1/2015 209,000 140
500M Missouri State Health & Educational Facilities Auth.,
6.75%, 5/15/2010 565,625 378
310M Springfield Pub. Bldg. Corp. Leasehold Rev.
(Springfield Recreational) Proj. Series "B",
5.85%, 6/1/2014 318,913 213
250M St. Joseph's School District, 5.75%, 3/1/2019 251,875 168
375M St. Louis Cnty. Pattonville School District #3,
5.75%, 3/1/2017 380,625 255
---------------------------------------------------------------------------------------------------------
1,726,038 1,154
---------------------------------------------------------------------------------------------------------
New Jersey-3.4%
485M New Jersey Housing & Mortgage Fin. Rev., 6.55%,
10/1/10 505,613 338
---------------------------------------------------------------------------------------------------------
New York-2.1%
290M New York City Mun. Water Fin. Auth. Rev., 5.875%,
6/15/2001* 308,850 206
---------------------------------------------------------------------------------------------------------
North Carolina-2.8%
430M Iredell County Public Facilities School Projects, 5.50%,
6/1/19 419,250 280
---------------------------------------------------------------------------------------------------------
Oregon-6.1%
400M Klamath Falls Waste Water Revenue, 5.50%,
6/1/25 389,000 260
500M Oregon State Dept. of Administrative Services
Cert. of Partic., 5.65%, 5/1/2007* 525,000 351
---------------------------------------------------------------------------------------------------------
914,000 611
---------------------------------------------------------------------------------------------------------
Pennsylvania-9.6%
525M Erie General Obligation, 5.75%, 5/15/2007* 550,594 368
500M Erie Sewer Authority Revenue, 5.875%, 6/1/2018 508,125 340
---------------------------------------------------------------------------------------------------------
<CAPTION>
Portfolio of Investments (continued)
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
June 30, 2000
---------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pennsylvania (continued)
$ 350M Philadelphia Water & Wastewater Rev., 6.25%,
8/1/12 $ 381,938 $ 255
---------------------------------------------------------------------------------------------------------
1,440,657 963
---------------------------------------------------------------------------------------------------------
Puerto Rico-6.8%
400M Puerto Rico Commonwealth Hwy. & Trans.
Auth. Rev., 6.25%, 7/1/2014 441,500 295
545M Puerto Rico Indl. Tourist Edl. Med. & Env. Ctl.
Facs., 6.25%, 7/1/2016 570,888 382
---------------------------------------------------------------------------------------------------------
1,012,388 677
---------------------------------------------------------------------------------------------------------
Texas-9.2%
505M Austin Texas Utility Systems, 6%, 11/15/2013 539,088 360
500M Harris County General Obligation, 6.50%, 8/15/2013 557,500 373
250M Houston Water Conveyance System Cert. of Partic.,
6.25%, 12/15/2012 271,875 182
---------------------------------------------------------------------------------------------------------
1,368,463 915
---------------------------------------------------------------------------------------------------------
Total Value of Municipal Bonds (cost $13,734,552) 97.20% 14,537,019 9,716
Other Assets, Less Liabilities 2.8 424,857 284
---------------------------------------------------------------------------------------------------------
Net Assets 100.0% $14,961,876 $10,000
=========================================================================================================
*Municipal Bonds which have been prerefunded are shown maturing at the prerefunded call date.
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Statement of Assets and Liabilities
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
June 30, 2000
---------------------------------------------------------------------------------------------------
<S> <C>
Assets
Investment in securities, at value (identified cost $13,734,552) (Note 1A) $14,537,019
Cash 7,292
Receivables:
Investment securities sold 712,520
Interest 200,491
-----------
Total Assets 15,457,322
-----------
Liabilities
Payables:
Investment securities purchased 419,900
Dividend payable 60,955
Trust shares redeemed 7,500
Accrued expenses 4,989
Accrued advisory fees 2,102
-----------
Total Liabilities 495,446
-----------
Net Assets $14,961,876
===========
Net Assets Consist of:
Capital paid in $13,909,436
Undistributed net investment income 14,913
Accumulated net realized gain on investment transactions 235,060
Net unrealized appreciation in value of investments. 802,467
-----------
Total $14,961,876
===========
Shares of beneficial interest outstanding 1,070,194
===========
Net asset value and redemption price per share
(Net assets divided by trust shares outstanding) $13.98
===========
Maximum offering price per share
(Net asset value/.9525)* $14.68
===========
*On purchases of $100,000 or more, the sales charge is reduced.
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Statement of Operations
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
Six Months Ended June 30, 2000
---------------------------------------------------------------------------------------------------
<S> <C> <C>
Investment Income
Interest Income $432,501
Expenses (Notes 1 and 3):
Advisory fee $ 75,982
Distribution plan expenses 38,005
Professional fees 12,166
Shareholder servicing costs 4,703
Reports and notices to shareholders 1,821
Custodian fees 1,578
Other expenses 2,731
--------
Total expenses 136,986
Less: Expenses waived or assumed (72,717)
Custodian fees paid indirectly (1,578)
--------
Net expenses 62,691
--------
Net investment income 369,810
Realized and Unrealized Gain (Loss)
on Investments (Note 2):
Net realized gain on investments 235,060
Net unrealized appreciation of investments 175,683
--------
Net gain on investments 410,743
--------
Net Increase in Net Assets Resulting
from Operations $780,553
========
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Statement of Changes in Net Assets
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
---------------------------------------------------------------------------------------------------
1/1/00 to 1/1/99 to
6/30/00 12/31/99
-------------------------------------------------------------- --------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets
From Operations
Net investment income $ 369,810 $ 793,234
Net realized gain on investments 235,060 29,405
Net unrealized appreciation (depreciation)
of investments 175,683 (1,148,959)
----------- -----------
Net increase (decrease) in net assets resulting
from operations 780,553 (326,320)
----------- -----------
Distributions to Shareholders
Net investment income (372,728) (775,403)
Net realized gains -- (29,405)
----------- -----------
Total distributions (372,728) (804,808)
----------- -----------
Trust Share Transactions*
Proceeds from shares sold 221,460 1,636,590
Reinvestment of distributions 158,882 455,722
Cost of shares redeemed (1,668,178) (2,028,492)
----------- -----------
Net increase (decrease) from trust share
transactions (1,287,836) 63,820
----------- -----------
Net decrease in net assets (880,011) (1,067,308)
Net Assets
Beginning of period 15,841,887 16,909,195
----------- -----------
End of period+ $14,961,876 $15,841,887
=========== ===========
+ Includes undistributed net investment income of $ 14,913 $ 17,831
=========== ===========
* Trust Shares Issued and Redeemed
Sold 16,048 114,579
Issued for distributions reinvested 11,608 32,373
Redeemed (121,491) (144,597)
----------- -----------
Net increase (decrease) in trust shares
outstanding (93,835) 2,355
=========== ===========
See notes to financial statements
</TABLE>
Notes to Financial Statements
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
1. Significant Accounting Policies -- Executive Investors Trust (the
"Trust"), a Massachusetts business trust, is registered under the
Investment Company Act of 1940 (the "1940 Act") as a diversified, open-
end management investment company. The Trust consists of unlimited
shares of beneficial interest of the Insured Tax Exempt Fund (the
"Fund"). The objective of the Fund is to seek a high level of interest
income that is exempt from federal income tax and is not a tax
preference item for purposes of the Alternative Minimum Tax.
A. Security Valuation -- The municipal bonds in which the Fund invests
are traded primarily in the over-the-counter markets. Such securities
are valued daily at their fair value on the basis of valuations provided
by a pricing service approved by the Board of Trustees. The pricing
service considers security type, rating, market condition, yield data
and other available information in determining value. "When-issued
securities" are reflected in the assets of the Fund as of the date the
securities are purchased. Securities for which market quotations are not
readily available are valued on a consistent basis at fair value as
determined in good faith by or under the supervision of the Trust's
officers in a manner specifically authorized by the Board of Trustees of
the Trust.
The municipal bonds held by the Fund are insured as to payment of
principal and interest by the issuer or under insurance policies written
by independent insurance companies. The Fund may retain any insured
municipal bond which is in default in the payment of principal or
interest until the default has been cured, or the principal and interest
outstanding are paid by an insurer or issuer of any letter of credit or
other guarantee supporting such municipal bond. In such case, it is the
Fund's policy to value the defaulted bond daily based upon the value of
a comparable bond which is insured and not in default. In selecting a
comparable bond, the Fund will consider security type, rating, market
condition and yield. The Fund may invest up to 20% of its assets in
portfolio securities not covered by the insurance feature.
B. Federal Income Tax -- No provision has been made for federal income
taxes on net income or capital gains since it is the policy of the Fund
to continue to comply with the special provisions of the Internal
Revenue Code applicable to regulated investment companies and to make
sufficient distributions of income and capital gains (in excess of any
available capital loss carryovers), to relieve it from all, or
substantially all, federal income taxes.
C. Distributions to Shareholders -- Dividends from net investment income
to the shareholders of the Fund are normally declared daily and paid
monthly. Dividends from net investment income of the Fund are considered
exempt-interest dividends and as such should not be subject to federal
income taxes.
Distributions from net realized capital gains, if any, are normally
declared and paid annually. Income dividends and capital gain
distributions are determined in accordance with income tax regulations
which may differ from generally accepted accounting principles. These
differences are primarily due to differing treatments for capital loss
carryforwards and post-October capital losses.
D. Use of Estimates -- The preparation of the financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expense during the
reporting period. Actual results could differ from those estimates.
E. Other -- Security transactions are accounted for on the date the
securities are purchased or sold. Cost is determined, and gains and
losses are based, on the identified cost basis for both financial
statement and federal income tax purposes. Interest income and estimated
expenses are accrued daily. For the six months ended June 30, 2000, The
Bank of New York, custodian for the Fund, has provided total credits in
the amount of $1,578 against custodian charges based on the uninvested
cash balances of the Fund.
2. Security Transactions -- For the six months ended June 30, 2000,
purchases and sales of municipal securities other than short-term
municipal notes, were $13,154,705 and $14,741,699, respectively. At June
30, 2000, aggregate cost for federal income tax purposes was
$13,734,552. Accumulated net unrealized appreciation was $802,467
consisting entirely of unrealized appreciation.
3. Advisory Fee and Other Transactions With Affiliates -- Certain
officers and trustees of the Trust are officers and directors of its
investment adviser, Executive Investors Management Company, Inc.
("EIMCO"), its underwriter, Executive Investors Corporation ("EIC")
and/or its transfer agent, Administrative Data Management Corp. ("ADM").
Trustees of the Trust who are not "interested persons" of the Trust as
defined in the 1940 Act are remunerated by the Fund.
For the six months ended June 30, 2000, trustee fees accrued by the Fund
amounted to $150.
The Investment Advisory Agreement provides as compensation to EIMCO an
annual fee, payable monthly, at the rate of 1% on the first $200 million
of the Fund's average daily net assets, .75% on the next $300 million,
declining by .03% on each $250 million thereafter, down to .66% on
average daily net assets over $1 billion. For the six months ended June
30, 2000, the total advisory fee accrued to EIMCO was $75,982 of which
$53,188 was waived. In addition, expenses of $11,928 were assumed by
EIMCO.
Notes to Financial Statements (continued)
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
For the six months ended June 30, 2000, EIC, as underwriter of the
Trust, received $898 in commissions from the sale of Trust shares, after
allowing $6,189 to other dealers. Shareholder servicing costs included
$3,318 in transfer agent fees accrued to ADM.
Pursuant to a Distribution Plan adopted under Rule 12b-1 of the 1940
Act, the Fund is authorized to pay a fee equal to .50% of its average
daily net assets on an annualized basis each fiscal year, payable
quarterly. The fee consists of a distribution fee and a service fee. The
service fee is paid for the ongoing servicing of clients who are
shareholders of the Fund. For the six months ended June 30, 2000, total
Distribution Plan fees accrued to EIC amounted to $38,005 of which
$7,601 was waived.
4. Concentration of Credit Risk -- The Fund invests in debt instruments of
municipal issuers whose ability to meet their obligations may be
affected by economic developments in a state, industry or region.
<TABLE>
<CAPTION>
Financial Highlights
EXECUTIVE INVESTORS INSURED TAX EXEMPT FUND
The following table sets forth the operating performance data for a share of capital stock outstanding,
total return, ratios to average net assets and other supplemental data for each year indicated.
1/1/00 Year Ended December 31
to -------------------------------------------------------
6/30/00 1999 1998 1997 1996 1995
-------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Per Share Data
--------------
Net Asset Value,
Beginning of Period $13.61 $14.56 $14.41 $13.82 $14.04 $12.53
-------- -------- --------- -------- -------- --------
Income from Investment Operations:
Net investment income .33 .67 .66 .67 .66 .72
Net realized and unrealized gain (loss)
on investments .38 (.94) .39 .71 (.10) 1.80
-------- -------- --------- -------- -------- --------
Total from Investment Operations .71 (.27) 1.05 1.38 .56 2.52
-------- -------- --------- -------- -------- --------
Less Distributions from:
Net investment income .34 .65 .66 .67 .67 .73
Net realized gain -- .03 .24 .12 .11 .28
-------- -------- --------- -------- -------- --------
Total Distributions .34 .68 .90 .79 .78 1.01
-------- -------- --------- -------- -------- --------
Net Asset Value, End of Period 13.98 13.61 14.56 14.41 13.82 14.04
======== ======== ========= ======== ======== ========
Total Return (%)* 5.25 (1.92) 7.39 10.30 4.11 20.53
----------------
Ratios/Supplemental Data
------------------------
Net Assets, End of Period (in millions) $15 $16 $17 $16 $15 $13
Ratio to Average Net Assets: (%)+
Expenses .80(a) .80 .80 .75 .75 .50
Net investment income 4.86(a) 4.72 4.50 4.80 4.85 5.35
Ratio to Average Net Assets Before
Expenses Waived or Assumed: (%)
Expenses 1.80(a) 1.73 1.73 1.71 1.71 1.74
Net investment income 3.86(a) 3.79 3.57 3.84 3.89 4.11
Portfolio Turnover Rate (%) 88 205 172 126 116 147
(a) Annualized
* Calculated without sales charges
+ Net of expenses waived or assumed (Note 3)
See notes to financial statements
</TABLE>
Independent Auditors' Report
To the Shareholders and Trustees of
Executive Investors Trust
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments of the Insured Tax Exempt Fund (a
series of Executive Investors Trust) as of June 30, 2000, the related
statement of operations for the six months then ended, the statement of
changes in net assets for the six months ended June 30, 2000 and the
year ended December 31, 1999 and the financial highlights for each of
the periods indicated thereon. These financial statements and financial
highlights are the responsibility of the Trust's management. Our
responsibility is to express an opinion on these financial statements
and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included
confirmation of securities owned as of June 30, 2000, by correspondence
with the custodian and brokers. An audit also includes assessing the
accounting principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the
financial position of the Insured Tax Exempt Fund at June 30, 2000, and
the results of its operations for the six months then ended, changes in
its net assets and financial highlights for the periods presented, in
conformity with generally accepted accounting principles.
Tait, Weller & Baker
Philadelphia, Pennsylvania
July 31, 2000
EXECUTIVE INVESTORS TRUST
Trustees
------------------------------
James J. Coy (Emeritus)
Robert M. Grohol
Glenn O. Head
Kathryn S. Head
Larry R. Lavoie
Rex R. Reed
Herbert Rubinstein
James M. Srygley
John T. Sullivan
Robert F. Wentworth
Officers
------------------------------
Glenn O. Head
President
Clark D. Wagner
Vice President
Concetta Durso
Vice President and Secretary
Joseph I. Benedek
Treasurer
Mark S. Spencer
Assistant Treasurer
Carol Lerner Brown
Assistant Secretary
EXECUTIVE INVESTORS TRUST
Shareholder Information
------------------------------
Investment Adviser
Executive Investors Management Company, Inc.
95 Wall Street
New York, NY 10005
Underwriter
Executive Investors Corporation
95 Wall Street
New York, NY 10005
Custodian
The Bank of New York
48 Wall Street
New York, NY 10286
Transfer Agent
Administrative Data Management Corp.
581 Main Street
Woodbridge, NJ 07095-1198
Legal Counsel
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W.
Washington, DC 20036
Auditors
Tait, Weller & Baker
Eight Penn Center Plaza
Philadelphia, PA 19103
It is the Trust's practice to mail only one copy of its annual and semi-
annual reports to any address at which more than one shareholder with
the same last name has indicated that mail is to be delivered.
Additional copies of the reports will be mailed if requested by any
shareholder in writing or by calling 800-423-4026. The Trust will ensure
that separate reports are sent to any shareholder who subsequently
changes his or her mailing address.
This report is authorized for distribution only to existing
shareholders, and, if given to prospective shareholders, must be
accompanied or preceded by the Trust's prospectus.
