[OBJECT OMITTED]
- --------------------------------------------------------------------------------
CLEARWATER INVESTMENT TRUST
- --------------------------------------------------------------------------------
February 12, 1998
TO: Our Unit Holders
On December 31, 1997, the net asset value of the Clearwater Growth Fund was
$21.17 per unit. The net asset value of the Clearwater Small Cap Fund was $15.24
per unit. On a total return basis for 1997, the Clearwater Growth Fund increased
by 28.4% and the Clearwater Small Cap Fund increased by 40.2%. For comparative
purposes, the S&P 500 increased by 33.2% and the Russell 2000 increased by
22.4%. For the fourth quarter, the Clearwater Growth Fund increased 1.3% and the
Clearwater Small Cap Fund decreased 2.2%. The S&P 500 increased 2.9% and the
Russell 2000 decreased 3.4%.
Sit Investment Associates, Inc., the subadvisor for the Clearwater Growth Fund
through October 31, made the following comments as of that date, their final
report as subadvisor for the fund before being replaced by Parametric Portfolio
Associates:
"U.S. financial markets were characterized by increased volatility in
October, caused by market turbulence in Asia that spread to Latin
America, Europe, and ultimately to the U.S. Your portfolio fared quite
well in the downturn, and the year-to-date results are very
satisfactory, as shown below:
Total Returns to 10/31/97
One Month Year-to-Date
S & P 500 Index -3.3% +25.3%
Russell 1000 Growth Index -3.7% +23.8%
Russell Midcap Growth Index -2.8% +25.8%
Hybrid Index -4.4% +21.7%
Your Portfolio -2.6% +23.4%
The favorable October performance was due primarily to positive stock
selection variances versus benchmarks. Particularly noteworthy was the
strong relative performance of stocks in the technology and retail
groups.
Third quarter U.S. real GDP rose +3.5%, paced by strong consumer
spending on durable goods. Our estimate of full-year 1998 real GDP is
+2.9%, down from the 3.8% growth we expect in 1997. Current consensus
estimates are that the problems in the entire Asia region might pare
as much as -0.5% from U.S. real GDP growth in 1998. We agree that
there will be a small negative effect on overall U.S. economic growth
and that, on the margin, lower inflationary pressures will be another
outcome. Standard & Poors 500 reported profit gains in both 1997 and
1998 are forecast to be in the +8 to +10 percent range and operating
profit gains should be somewhat higher.
<PAGE>
Page 2
Moderate aggregate economic and profit growth, in connection with low
inflation, are normally ingredients that favor growth stock investing,
and they appear to be present today. Also encouraging is the fact that
during October the earnings yield/bond yield spread relationship
experienced one of the largest one-month swings favoring equities that
has been experienced in the last several years. Accordingly, equity
portfolios are being maintained in essentially fully invested
positions."
As of November 1, 1997 Parametric Portfolio Associates replaced Sit Associates
as subadvisor for the Clearwater Growth Fund. The subadvisor comments below on
the transition and the outlook for the year ahead:
"Parametric Portfolio Associates began managing the Clearwater Growth
Fund portfolio on November 1, 1997. Initial trading and portfolio
management activity consisted primarily of diversifying the portfolio
to more closely match the Russell 1000 index. Early tax-aware
rebalancing and investment of portfolio cash resulted in nearly a 1%
reduction in annual tracking differences versus the index. The trading
activity generated a net realized loss in the portfolio. These results
were above expectations as market volatility prior to and during the
transition created a window of opportunity for diversification
activities.
As of 12/31/97, the portfolio was diversified across 279 stocks
representing all industries and economic sectors. The investment
posture still reflects to a large degree the previous manager's biases
toward growth and mid-capitalization securities. Investment performance
in the last two months of 1997 reflected these biases as value
outperformed growth and large outperformed mid, and the portfolio
underperformed its larger capitalization, style-neutral benchmark
index.
Parametric will continue to monitor the portfolio and utilize all
opportunities to diversify using cash flows, dividends, and market
volatility. In addition, Parametric will continue to research and
communicate alternative diversification plans to the Clearwater fund
management. Parametric fully expects the long-term real return of this
portfolio after taxes and fees to be extremely competitive relative to
all alternatives."
<PAGE>
Page 3
[GRAPHIC OMITTED]
Annualized Total Return
One Year Five Year Ten Year
Growth Fund 28.4% 16.4% 15.9%
S&P 500 33.2% 20.2% 18.0%
Kennedy Capital Management, the subadvisor for the Small Cap Fund, made the
following comments:
"Last year our economic forecast was quite accurate. We predicted
continuing low inflation with modest and sustainable economic growth.
With regard to the financial markets, we were less prescient. We were
bullish, but not nearly bullish enough. We offered that the markets
might give 10% to investors; instead, the Russell 2000 returned 22.4%.
(The Russell 2000 Value was up 26.2% and the Russell Growth index
added 12.9%.) We were also expecting some re-alignment between the
values of small and large-cap stocks. And in the third quarter, small
stocks rallied and the re-alignment appeared at hand. Small stocks
were gaining momentum and market pundits were singing their praises.
Alas, the Asian flu struck. As the virus took hold, fear returned to
the market and investors voted their preference for the larger,
better-known securities. Never mind that the large global companies
have the most to lose from a strong dollar cutting into their exports.
Never mind that these larger companies with the most global reach will
be negatively affected by the declining purchasing power of billions
of Asian consumers. No, investors punished small U.S. companies that
typically sell to a domestic market. In the fourth quarter the S&P 500
gained 2.9% while the Russell 2000 lost 3.4%. Small growth and
technology stocks were pummeled particularly hard. We were, however,
correct in posing that the threat to the market would be external --
although we were neutral on whether the problem would be inflation or
deflation.
Looking forward, we know that the Asian threat is a deflationary one.
Will these economies contract enough to slow world trade to
dangerously low levels? The conventional wisdom is "no." Central
bankers will print money before they permit a downward economic
spiral. We're not so sure.
<PAGE>
Page 4
Certainly, the IMF has been imposing some fairly harsh terms on these
struggling economies. In our view, we would prefer to see the banks
take some pain. The IMF, by bailing out the lenders, just postpones
the problem. If lenders are not permitted to lose, then they will
continue to make risky loans.
Bottom line: We predict a modest decline in interest rates and a flat
year for the stock market. As the excesses are shaken out, small
stocks will surge. It may happen in late 1998 or maybe early in 1999.
That's our prediction! Guess? Wish? Regardless, we will continue to
seek out small, under-followed, but rapidly growing companies and help
bring them to the attention of other investors."
[GRAPHIC OMITTED]
Annualized Total Return
One Year Five Year Inception 12/31/91
Small Cap Fund 40.2% NA 17.4%
Russel 2000 22.4% NA 15.8%
Clearwater Investment Trust Clearwater Management Company
- --------------------------- -----------------------------
F. T. Weyerhaeuser, Chairman & Treasurer P. W. Pascoe, Chairman &
Samuel B. Carr, Jr. Treasurer
Stanley R. Day, Jr. W. T. Weyerhaeuser, V.P. &
Robert J. Phares Secretary
E. C. Driscoll
W. John Driscoll
D. C. Titcomb, V.P. & Secretary C. W. Morley
F. W. Piasecki
D. C. Titcomb
G. H. Weyerhaeuser, Jr
<PAGE>
CLEARWATER INVESTMENT TRUST
Financial Statements
December 31, 1997
<PAGE>
KPMG Peat Marwick
4200 Norwest Center
90 South Seventh Street
Minneapolis, MN 55402
Independent Auditors' Report
The Board of Trustees and Shareholders
Clearwater Investment Trust:
We have audited the accompanying statements of assets and liabilities, including
the schedules of investments in securities, of Clearwater Small Cap Fund and
Clearwater Growth Fund (funds within Clearwater Investment Trust) as of December
31, 1997, and the related statements of operations for the year then ended, the
statements of changes in net assets for each of the years in the two-year period
then ended and the financial highlights for each of the years in the five-year
period then ended. These financial statements and the financial highlights are
the responsibility of the funds' management. Our responsibility is to express an
opinion on these financial statements and the 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 audits to obtain
reasonable assurance about whether the financial statements and the 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. Investment securities held in custody are confirmed to us by the
custodian. As to securities purchased and sold, but not received or delivered,
we request confirmations from brokers, and where replies are not received, we
carry out other appropriate auditing procedures. 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 the financial highlights referred
to above present fairly, in all material respects, the financial position of
Clearwater Growth Fund and Clearwater Small Cap Fund at December 31, 1997, and
the results of their operations for the year then ended, the changes in their
net assets for each of the years in the two-year period then ended and the
financial highlights for each of the years in the five-year period then ended,
in conformity with generally accepted accounting principles.
/s/KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Minneapolis, Minnesota
February 12, 1998
<PAGE>
CLEARWATER INVESTMENT TRUST
<TABLE>
<CAPTION>
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1997
GROWTH SMALL CAP
FUND FUND
ASSETS
<S> <C> <C>
Investments in securities, at market value (note 2)
(identified cost: $64,154,251 Growth Fund; $36,706,842 Small Cap Fund) $116,074,449 $48,369,167
Cash 1,832 (42,426)
Receivable for investment securities sold 0 249,204
Accrued dividend and interest receivable 87,717 7,921
Other receivables 0 189,816
----------- ---------
TOTAL ASSETS 116,164,048 48,773,682
LIABILITIES
Payables for investment securities purchased 0 758,060
Dividend payable 8,929,488 7,022,467
Other payables 189,816 0
Accrued management fee 185,489 154,746
----------- ----------
TOTAL LIABILITIES 9,304,793 7,935,273
NET ASSETS $106,859,255 $40,838,409
- ---------- =========== ===========
CAPITAL
Capital stock and additional paid-in capital
(authorized unlimited number of shares at no par
value for each Fund; outstanding 5,047,760 and
2,679,104 shares, respectively (note 2)) $ 54,939,981 $29,166,125
Accumulated net realized gain(loss) (975) 9,958
Unrealized appreciation of investments 51,920,249 11,662,326
---------- ----------
NET ASSETS $106,859,255 $40,838,409
- ---------- =========== ===========
Net asset value per share of outstanding capital stock $ 21.17 $ 15.24
<FN>
See accompanying notes to financial statements.
</FN>
</TABLE>
-1-
<PAGE>
CLEARWATER INVESTMENT TRUST
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS
For Year Ended December 31, 1997
GROWTH SMALL CAP GROWTH SMALL CAP
FUND FUND
INVESTMENT INCOME
<S> <C> <C>
Income:
Dividends (net of foreign taxes withheld of $405 and $0, respectively) $ 749,020 $ 347,182
Interest 198,921 121,556
----------- -----------
TOTAL INCOME 947,941 468,738
Expenses: (note 5)
Investment advisory fee 1,012,399 534,172
NET INVESTMENT INCOME (LOSS) (64,458) (65,434)
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain (loss) on security transactions 8,928,506 7,097,859
Unrealized appreciation (depreciation) during the period 16,922,059 6,508,576
NET GAIN ON INVESTMENTS 25,850,565 13,606,435
NET INCREASE IN NET ASSETS FROM OPERATIONS $25,786,107 $13,541,001
=========== ===========
</TABLE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
For Year Ended December 31, 1997 GROWTH FUND SMALL CAP FUND
12/31/97 12/31/96 12/31/97 12/31/96
<S> <C> <C> <C> <C>
OPERATIONS
Net investment income(loss) $ (64,458) $ (66,846) $ (65,434) $ 1,464
Net realized gain(loss) on investments 8,928,506 13,625,055 7,097,859 1,056,580
Unrealized appreciation(depreciation)
during the period 16,922,059 4,478,299 6,508,576 3,060,523
---------- ---------- ---------- ---------
NET INCREASE IN NET ASSETS FROM OPERATIONS 25,786,107 18,036,508 13,541,001 4,118,567
DISTRIBUTIONS TO SHAREHOLDERS FROM
Investment income, net 0 0 0 (2,953)
Excess distribution of net investment income 0 0 0 (18,195)
Net realized gain(loss) on investments (8,987,082) (13,567,454) (7,022,467) (1,059,022)
Tax return of capital 0 0 0 (36,781)
----------- ------------ ------------ ------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (8,987,082) (13,567,454) (7,022,467) (1,116,951)
CAPITAL SHARE TRANSACTIONS (note 4)
Proceeds from shares sold 435,000 9,000 2,164,600 2,162,955
Reinvestment of distributions from
net investment income 31,725 7,281,829 0 812,971
Payments for shares redeemed (4,328,643) (2,612,400) (618,257) (29,543)
----------- ----------- ----------- ----------
INCREASE(DECREASE) IN NET ASSETS FROM
CAPITAL SHARES TRANSACTIONS (3,861,918) 4,678,429 1,546,343 2,946,383
----------- --------- --------- ----------
TOTAL INCREASE IN NET ASSETS 12,937,107 9,147,483 8,064,877 5,947,999
NET ASSETS
At the beginning of the period 93,922,148 84,774,665 32,773,532 26,825,533
---------- ---------- ---------- ----------
At the end of the period $106,859,255 $93,922,148 $40,838,409 $32,773,532
=========== =========== =========== ===========
<FN>
See accompanying notes to financial statements.
</FN>
</TABLE>
-2-
<PAGE>
CLEARWATER INVESTMENT TRUST
Notes to Financial Statements
(1) Organization
Clearwater Investment Trust (the Trust) was established on January 12,
1987 as a Massachusetts business trust and is registered under the
Investment Company Act of 1940 (as amended) as a diversified open-end
management investment company and presently includes two series of
funds: Clearwater Growth Fund and Clearwater Small Cap Fund (the
funds). The Trust's declaration of trust permits the board of directors
to create additional funds in the future. The investment objective of
the funds is long-term capital growth. The Clearwater Growth Fund
invests in a broad list of securities that offer the potential for
growth. The Clearwater Small Cap Fund primarily invests in equity and
fixed income securities of companies that have total equity market
capitalizations of $1 billion or lower.
(2) Summary of Significant Accounting Policies
The significant accounting policies followed by the funds are as follows:
Investments in Securities
Investments in securities are valued at the last sales price on the
principal exchange or market where they are traded. Securities which
have not traded on the date of valuation or securities for which sales
prices are not generally reported are valued at the mean between the
last bid and asked prices. Securities for which no market quotations
are readily available (including those the trading of which has been
suspended) will be valued at fair value as determined in good faith by
the board of trustees, although the actual computations may be made by
persons acting pursuant to the direction of the board.
Security transactions are accounted for on the date the securities are
purchased or sold. Realized gains and losses are calculated on an
identified cost basis. Dividend income is recognized on the ex-dividend
date and interest income, including amortization of original issue
discount and premium, is accrued daily.
1
<PAGE>
CLEARWATER INVESTMENT TRUST
Federal Taxes
The Trust's policy is to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to shareholders.
Therefore, no income tax provision is required. Each fund is treated as
a separate entity for federal income tax purposes. In addition, on a
calendar year basis, each fund intends to distribute substantially all
of its net investment income and realized gains, if any, to avoid the
payment of any federal excise taxes.
Net investment income and net realized gains (losses) for the funds may
differ for financial statement and tax purposes. The character of
distributions made during the year from net investment income or net
realized gains may differ from their ultimate characterization for
federal income tax purposes. Also, due to the timing of dividend
distributions, the fiscal year in which amounts are distributed may
differ from the year that the income or realized gains (losses) were
recorded by the funds.
On the statements of assets and liabilities, due to permanent
book-to-tax differences, the following adjustments have been made:
Clearwater Clearwater
Growth Fund Small Cap Fund
-----------------------------------------------------------------
Undistributed net investment income $64,458 $65,434
Accumulated net realized gains 0 (65,434)
Additional paid-in capital (64,458) 0
Distributions to Shareholders
Distributions to shareholders from net investment income and net
realized gains, if any, are declared annually and paid in cash or
reinvested in additional shares.
Use of Estimates
The preparation of 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 and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of increase
and decrease in net assets from operations during the period. Actual
results could differ from those estimates.
2
<PAGE>
CLEARWATER INVESTMENT TRUST
(3) Investment Security Transactions
Cost of purchases and proceeds from sales of securities, other than
temporary investments in short-term securities, for the period ended
December 31, 1997, were as follows:
Purchases Sales proceeds
----------------------------------------------------------------
Clearwater Growth Fund $38,200,872 $46,256,744
Clearwater Small Cap Fund 35,714,281 35,301,244
(4) Capital Share Transactions
Transactions in shares of each fund for the years ended December 31,
1997 and 1996, were as follows:
Clearwater Clearwater
Growth Fund Small Cap Fund
------------------ ------------------
12/31/97 12/31/96 12/31/97 12/31/96
----------------------------------------------------------------
Sold 24,071 500 144,088 171,784
Issued for reinvested
distributions 1,459 407,261 -0- 63,812
Redeemed (230,550) (137,983) (36,779) (2,467)
----------------------------------------------------------------
Increase (decrease) (205,020) 269,778 107,309 233,129
----------------------------------------------------------------
3
<PAGE>
CLEARWATER INVESTMENT TRUST
(5) Expenses and Related Party Transactions
The Trust has a contract for investment advisory services with
Clearwater Management Company, a management firm of which the Trust's
chairman is a shareholder. Under terms of an agreement, Clearwater
Growth Fund and Clearwater Small Cap Fund pay a monthly fee equal to an
annual rate of .45% and 1.35% of average net assets, respectively. On
November 1, 1997, the management fee for the Growth Fund decreased from
1.10% to 0.45% of average net assets to reflect a change in the
sub-advisor from SIT Investment Associates, Inc. to Parametric
Portfolio Associates, Inc. Clearwater Management Company is responsible
for the payment or reimbursement of all of the Funds' expenses, except
brokerage, taxes, interest and extraordinary expenses.
The management firm has entered into a sub-advisory contract with an
independent investment advisory firm for each fund to provide daily
investment management services. The sub-advisory fee for the Clearwater
Growth Fund, payable to SIT Investment Associates, Inc., from January 1
to November 1, 1997 was equal to an annual rate of .75% of the first
$10 million in net assets and then decreasing in reduced percentages to
.35% of net assets in excess of $80 million. The new sub-advisory fee
for the Clearwater Growth Fund, payable to Parametric Portfolio
Associates, Inc., is equal to an annual rate of 0.15% of net assets.
The sub-advisory fee for the Clearwater Small Cap Fund, payable to
Kennedy Capital Management, is equal to an annual rate of 1.00% of the
first $30 million in net assets and then decreasing in reduced
percentages to 0.80% of net assets in excess of $50 million.
(6) Restricted Securities
At December 31, 1997, investments in securities for the Clearwater
Growth Fund includes a security sold under Rule 144A, which is exempt
from registration under the Securities Act of 1933, as amended. The
Fund currently limits investments in restricted securities to 15% of
net assets at the time of purchase. The aggregate value of such
security at December 31, 1997 was $1,168,750, representing 1.1% of net
assets for the Clearwater Growth Fund.
4
<PAGE>
CLEARWATER INVESTMENT TRUST
(7) Financial Highlights
Per share data (rounded to the nearest cent) for a share of capital stock
outstanding throughout the period and selected information for each period
is as follows:
Clearwater Growth Fund
Years ended December 31,
------------------------------------------
1997(d) 1996 1995 1994 1993
- --------------------------------------------------------------------------------
Net asset value, beginning of year 17.88 17.01 13.62 14.49 15.98
- --------------------------------------------------------------------------------
Income from investment
operations:
Net investment income (loss) (0.01) (0.01) 0.01 0.06 0.09
Net realized and unrealized
gains 5.08 3.68 4.43 0.11 0.27
- --------------------------------------------------------------------------------
Total from investment
operations 5.07 3.67 4.44 0.17 0.36
- --------------------------------------------------------------------------------
Less distributions:
Dividends from net investment
income 0.00 0.00 (0.01) (0.06) (0.09)
Distributions from realized
gains (1.78) (2.80) (1.04) (0.98) (1.76)
- --------------------------------------------------------------------------------
Total Distributions (1.78) (2.80) (1.05) (1.04) (1.85)
- --------------------------------------------------------------------------------
Net asset value, end of year 21.17 17.88 17.01 13.62 14.49
- --------------------------------------------------------------------------------
Total Return (a) 28.4% 21.6% 32.6% 1.2% 2.2%
Net assets, end of period(000's
omitted) $106,859 $93,922 84,775 65,999 61,037
Ratio of expenses to average
net assets 0.98% 1.08%(c) 1.08% 1.07% 1.08%
Ratio of net investment income(loss)
to average net assets -0.06% -0.07% 0.06% 0.39% 0.55%
Average brokerage commission
rate (b) $0.0571 $0.0547 n/a n/a n/a
Portfolio turnover rate (excluding
short-term securities) 38.16% 75.90% 58.64% 70.69% 52.76%
(a)Total return figures are based on the change in net asset value of a
share during the period and assumes reinvestment of distributions at
net asset value.
(b)Beginning in fiscal 1996, the fund is required to disclose an average
brokerage commission rate. The rate is calculated by dividing total
brokerage commissions paid on purchases and sales of portfolio
securities by the total number of related shares purchased and sold.
(c)Includes federal and state taxes of .01%.
(d)Effective November 1, 1997, Parametric Portfolio Associates, Inc.
became the subadvisor for the fund.
5
<PAGE>
CLEARWATER INVESTMENT TRUST
Clearwater Small Cap Fund
Years ended December 31,
1997 1996 1995 1994(b) 1993
- --------------------------------------------------------------------------------
Net asset value, beginning of year $12.74 $11.47 9.89 12.26 11.50
- --------------------------------------------------------------------------------
Income from investment
operations:
Net investment Income (loss) (0.02) 0.00 0.04 0.17 0.17
Net realized and unrealized
gain (loss) 5.14 1.71 2.56 (0.99) 1.60
- --------------------------------------------------------------------------------
Total from investment
operations 5.12 1.71 2.60 (0.82) 1.77
- --------------------------------------------------------------------------------
Less distributions:
Dividends from net investment
income 0.00 0.00 (0.04) (0.17) (0.17)
Excess distributions from net investment
income 0.00 (0.01) 0.00 0.00 0.00
Distributions from realized
gains (2.62) (0.42) (0.98) (1.38) (0.84)
Tax return of capital 0.00 (0.01) 0.00 0.00 0.00
- --------------------------------------------------------------------------------
Total Distributions (2.62) (0.44) (1.02) (1.55) (1.01)
- --------------------------------------------------------------------------------
Net asset value, end of year $15.24 $12.74 11.47 9.89 12.26
- --------------------------------------------------------------------------------
Total Return (a) 40.2% 15.0% 26.3% -6.7% 15.4%
Net assets, end of period(000's
omitted) $40,838 $32,774 26,826 17,998 13,972
Ratio of expenses to average
net assets 0.135% 1.37%(d)1.35% 1.40% 1.47%
Ratio of net investment income
(loss) to average net assets -0.17% 0.00% 0.36% 1.61% 1.38%
Average brokerage commission
rate (c) $0.0503 $0.0424 n/a n/a n/a
Portfolio turnover rate (excluding
short-term securities) 92.22% 89.25% 77.46% 122.88% 58.49%
(a)Total return figures are based on the change in net asset value of a
share during the period and assumes reinvestment of distributions at
net asset value.
(b)Effective May 1, 1994, a change was implemented in the fund's
investment policies whereby the fund must invest at least 65% of its
total assets in securities of companies that have total equity market
capitalizations of $1 billion or lower. Also effective January 1, 1994,
Kennedy Capital Management became the sub-adviser for the fund.
(c)Beginning in fiscal 1996, the fund is required to disclose an average
brokerage commission rate. The rate is calculated by dividing total
brokerage commissions paid on purchases and sales of portfolio
securities by the total number of related shares purchased and sold.
(d) Includes federal and state taxes of .04%.
6
<PAGE>
<TABLE>
<CAPTION>
CLEARWATER GROWTH FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
COMMON STOCKS
<S> <C> <C> <C> <C>
AIR TRANSPORTATION
300 AMR CORP (b) 35,793.00 38,550.00
200 DELTA AIR LINES INC. 20,824.50 23,800.00
400 FEDERAL EXPRESS CORP (b) 26,836.52 24,425.00
----------------------- -----------------------
TOTAL AIR TRANSPORTATION 83,454.02 86,775.00 0.08%
AIRCRAFT
19,000 BOEING CO 449,445.00 929,812.50
600 LOCKHEED MARTIN CORPORATION 59,173.50 59,100.00
800 UNITED TECHNOLOGIES CORP 57,473.04 58,250.00
----------------------- -----------------------
TOTAL AIRCRAFT 566,091.54 1,047,162.50 0.98%
ALUMINUM
500 ALUMINUM COMPANY OF AMERICA 36,655.00 35,187.50 0.03%
BANKS
1,900 BANC ONE CORP 100,164.01 103,193.75
500 BANK OF BOSTON CORP 41,430.00 46,968.75
1,300 BANK OF NEW YORK CO INC 62,790.52 75,156.25
2,300 BANKAMERICA CORP 168,819.31 167,900.00
300 BANKERS TRUST NEW YORK CORP 36,318.00 33,731.25
700 BARNETT BANKS INC 50,373.26 50,312.50
6,500 CHASE MANHATTEN CORP 654,888.75 711,750.00
8,500 CITICORP 357,041.25 1,074,718.75
300 COMERICA INC. 23,943.00 27,075.00
700 CORESTATES FINANCIAL CORP 50,542.03 56,043.75
400 FIFTH THIRD BANCORP 26,025.00 32,700.00
4,000 FIRST AMERICAN CORP-TENN 107,205.00 199,000.00
1,000 FIRST CHICAGO NBD CORP 74,122.50 83,500.00
1,700 FIRST UNION CORP (N C ) 84,458.21 87,125.00
900 FLEET FINANCIAL GROUP INC. 58,272.75 67,443.75
600 J P MORGAN & COMPANY 69,092.28 67,725.00
700 KEYCORP 44,267.02 49,568.75
1,400 MBNA CORP 37,621.50 38,237.50
900 MELLON BANK CORP 46,904.04 54,562.50
700 NATIONAL CITY CORP 42,254.52 46,025.00
2,400 NATIONSBANK CORP 149,050.32 145,950.00
52,000 NORWEST CORP 1,155,560.00 2,008,500.00
1,100 PNC BANK CORPORATION 53,028.47 62,768.75
4,000 REPUBLIC NEW YORK CORP 382,682.70 456,750.00
500 STATE STREET CORP 28,217.50 29,093.75
700 SUNTRUST BANKS INC. 46,060.77 49,962.50
800 U S BANCORP 83,398.00 89,550.00
500 WACHOVIA CORP 37,580.00 40,562.50
800 WASHINGTON MUTUAL INC. 55,000.00 51,050.00
200 WELLS FARGO & CO 59,349.50 67,887.50
----------------------- -----------------------
TOTAL BANKS 4,186,460.21 6,074,812.50 5.68%
See accompanying notes to investments in securities 1 (continued)
<PAGE>
CLEARWATER GROWTH FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
BEVERAGES
1,500 ANHEUSER-BUSCH COS INC 61,264.95 66,000.00
36,000 COCA-COLA CO 1,081,705.00 2,398,500.00
5,000 PEPSICO INC 186,237.50 182,187.50
----------------------- -----------------------
TOTAL BEVERAGES 1,329,207.45 2,646,687.50 2.48%
BROADCASTING
4,100 CBS CORPORATION 112,181.50 120,693.75
1,100 COMCAST CORP-SPECIAL CLASS A 30,662.50 34,718.75
1,700 TELE COMMUNICATIONS-CL A (b) 38,356.25 47,493.75
700 TELE COMM LIBERTY MEDIA GR-A (b) 23,012.50 25,375.00
1,400 TIME WARNER INC. 82,946.50 86,800.00
2,000 U S WEST MEDIA GROUP 52,557.60 57,750.00
1,000 VIACOM INC. (b) 30,716.30 40,875.00
----------------------- -----------------------
TOTAL BROADCASTING 370,433.15 413,706.25 0.39%
BUSINESS EQUIP & SERVICES
18,000 ACCUSTAFF INC (b) 332,705.00 414,000.00
700 BROWNING-FERRIS INDS 23,948.26 25,900.00
14,000 CALIBER SYSTEM INC 496,205.75 681,625.00
26,000 CERIDIAN CORP COM (b) 693,103.00 1,191,125.00
17,200 CORESTAFF INC (b) 434,102.00 455,800.00
12,000 DANKA BUSINESS SYSTEMS-SPON ADR 418,117.70 191,250.00
26,000 DENDRITE INTERNATIONAL INC. (b) 317,216.10 503,750.00
1,100 ELECTRONIC DATA SYSTEMS CORP 43,097.23 48,331.25
22,000 FIRST DATA CORP 226,047.22 643,500.00
500 PITNEY-BOWES INC. 41,455.00 44,968.75
900 REPUBLIC INDUSTRIES (b) 27,391.50 20,981.25
800 SERVICE CORP INTERNATIONAL 24,648.00 29,550.00
21,750 STEWART ENTERPRISES INC-CL A 629,245.99 1,014,093.75
5,500 SYLVAN LEARNING SYSTEMS INC (b) 207,480.00 214,500.00
1,500 WASTE MANAGEMENT INC. 37,402.50 41,250.00
----------------------- -----------------------
TOTAL BUSINESS EQUIP & SERVICES 3,952,165.25 5,520,625.00 5.17%
CAPITAL EQUIPMENT
1,200 CATERPILLAR INC 62,622.00 58,275.00
700 ILLINOIS TOOL WORKS, INC. 35,760.76 42,087.50
12,000 KENNAMETAL INC. 550,972.70 621,750.00
12,000 SUNDSTRAND CORP 381,907.50 604,500.00
----------------------- -----------------------
TOTAL CAPITAL EQUIPMENT 1,031,262.96 1,326,612.50 1.24%
CHEMICALS-PETRO & INORGANIC
800 DOW CHEMICAL 73,823.04 81,200.00
3,700 DUPONT E I DE NEMOURS 213,165.88 222,231.25
22,500 MONSANTO CO 329,839.69 945,000.00
----------------------- -----------------------
TOTAL CHEMICALS-PETRO & INORGANIC 616,828.61 1,248,431.25 1.17%
CHEMICALS-SPECIALTY
300 AIR PRODUCTS & CHEMICALS INC 23,043.00 24,675.00
100 PRAXAIR INC 4,456.00 4,500.00
----------------------- -----------------------
TOTAL CHEMICALS-SPECIALTY 27,499.00 29,175.00 0.03%
See accompanying notes to investments in securities 2 (continued)
<PAGE>
CLEARWATER GROWTH FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
COMMUNICATIONS EQUIPMENT
27,000 ADC TELECOMMUNICATIONS INC. (b) 631,999.00 1,127,250.00
7,000 CIENA CORP (b) 342,767.05 427,875.00
28,500 CISCO SYSTEMS INC (b) 278,270.35 1,588,875.00
1,100 3COM CORP (b) 48,087.49 38,431.25
2,100 LUCENT TECHNOLOGIES INC. 175,994.70 167,737.50
4,500 PAIRGAIN TECHNOLOGIES INC. (b) 94,432.20 87,187.50
14,500 TELLABS, INC. (b) 298,665.30 766,687.50
----------------------- -----------------------
TOTAL COMMUNICATIONS EQUIPMENT 1,870,216.09 4,204,043.75 3.93%
COMPUTERS-MAIN & MINI
500 DIGITAL EQUIPMENT (b) 26,667.50 18,500.00
2,800 HEWLETT-PACKARD CO 181,030.64 175,000.00
3,300 INTL BUSINESS MACHINES CORP 338,860.50 345,056.25
5,500 XEROX CORP 426,875.15 405,968.75
----------------------- -----------------------
TOTALS COMPUTERS-MAIN & MINI 973,433.79 944,525.00 0.88%
COMPUTERS-MICRO
2,300 COMPAQ COMPUTER CORP 158,181.81 129,806.25
900 DELL COMPUTER CORP (b) 77,072.76 75,600.00
----------------------- -----------------------
TOTAL COMPUTERS-MICRO 235,254.57 205,406.25 0.19%
COMPUTERS-PERIPHERALS
14,000 BAAN COMPANY NV (b) 199,062.50 462,000.00
11,000 ASPEN TECHNOLOGY INC. (b) 321,179.55 376,750.00
15,000 COMPUTER ASSOCIATES INTL INC. 514,842.00 793,125.00
19,000 ELECTRONICS FOR IMAGING (b) 548,465.30 315,875.00
1,600 EMC CORP MASS (b) 47,098.00 43,900.00
9,500 LEGATO SYSTEMS INC. (b) 157,970.10 418,000.00
13,000 MICROSOFT CORP (b) 83,073.61 1,680,250.00
26,500 ORACLE CORPORATION (b) 83,951.14 591,281.25
32,000 PARAMETRIC TECH (b) 417,553.25 1,516,000.00
55,000 PEOPLESOFT INC. (b) 862,211.20 2,145,000.00
------------------------ -----------------------
TOTAL COMPUTERS-PERIPHERALS 3,235,406.65 8,342,181.25 7.81%
CONSTRUCTION MATERIALS
19,000 CRANE CO 515,675.00 824,125.00
8,000 OWENS CORNING 248,120.85 273,000.00
600 PPG INDUSTRIES INC. 34,142.28 34,275.00
------------------------ -----------------------
TOTAL CONSTRUCTION MATERIALS 797,938.13 1,131,400.00 1.06%
COSMETICS & TOILETRIES
400 AVON PRODUCTS 26,011.52 24,550.00
16,500 GILLETTE COMPANY 550,137.35 1,657,218.75
------------------------ -----------------------
TOTAL COSMETICS & TOILETRIES 576,148.87 1,681,768.75 1.57%
DEFENSE
153 RAYTHEON CO CL-A 8,880.41 7,547.18
800 RAYTHEON CO CL-B 41,998.00 40,400.00
500 ROCKWELL INTERNATIONAL CORP 24,905.00 26,125.00
------------------------- -----------------------
TOTAL DEFENSE 75,783.41 74,072.18 0.07%
See accompanying notes to investments in securities 3 (continued)
<PAGE>
CLEARWATER GROWTH FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
ELECTRICAL EQUIPMENT
800 DOVER CORP 27,686.52 28,900.00
1,500 EMERSON ELECTRIC CO 83,733.75 84,656.25
38,600 GENERAL ELECTRIC CO 1,661,591.47 2,832,275.00
400 HONEYWELL INC 28,161.52 27,400.00
17,000 TYCO INTERNATIONAL LTD 329,885.00 766,062.50
----------------------- -----------------------
TOTAL ELECTRICAL EQUIPMENT 2,131,058.26 3,739,293.75 3.50%
ELECTRONIC COMPONENTS
700 AMP INC 32,698.26 29,400.00
38,000 ANALOG DEVICES (b) 681,654.00 1,052,125.00
26,000 INTEL CORP 208,329.75 1,826,500.00
19,000 XILINX INC (b) 579,697.78 666,187.50
2,000 MOTOROLA INC 129,307.60 114,125.00
----------------------- -----------------------
TOTAL ELECTRONIC COMPONENTS 1,631,687.39 3,688,337.50 3.45%
ELECTRONIC INSTRUMENTS
1,200 APPLIED MATERIALS INC. (b) 44,659.56 36,150.00
11,500 ASM LITHOGRAPHY HOLDING NV (b) 445,941.70 776,250.00
----------------------- -----------------------
TOTAL ELECTRONIC INSTRUMENTS 490,601.26 812,400.00 0.76%
FARM MACHINERY
800 DEERE & CO 43,423.04 46,650.00 0.04%
FINANCE COMPANIES
400 HOUSEHOLD INTERNATIONAL INC. 45,811.52 51,025.00 0.05%
FOOD & RELATED PRODUCTS
1,800 ARCHER DANIELS MIDLAND 40,720.50 39,037.50
6,500 CAMPBELL SOUP CO 312,112.00 377,812.50
1,600 CONAGRA INC COM 53,846.08 52,500.00
500 CPC INTERNATIONAL INC. 50,717.50 53,875.00
500 GENERAL MILLS INC 33,817.50 35,812.50
1,200 HEINZ (H J) CO 57,072.00 60,975.00
700 KELLOGG CO 30,710.75 34,737.50
300 PIONEER HI BRED INTL INC. 28,136.76 32,175.00
400 RALSTON PURINA CO 36,436.52 37,175.00
1,600 SARA LEE CORP 82,946.08 90,100.00
300 WRIGLEY (WM) JR CO 21,918.00 23,868.75
----------------------- -----------------------
TOTAL FOOD & RELATED PRODUCTS 748,433.69 838,068.75 0.78%
FOREST & PAPER PRODUCTS
300 GEORGIA-PACIFIC (TIMBER GRP) 5,990.16 6,806.25
300 GEORGIA-PACIFIC CORP (b) 20,265.33 18,225.00
1,000 INTERNATIONAL PAPER CO 47,122.50 43,125.00
1,800 KIMBERLY-CLARK CORP 95,401.80 88,762.50
----------------------- -----------------------
TOTAL FOREST & PAPER PRODUCTS 168,779.79 156,918.75 0.15%
FURNITURE & FURNISHING
500 MASCO CORP 23,030.00 25,437.50 0.02%
See accompanying notes to investments in securities 4 (continued)
<PAGE>
CLEARWATER GROWTH FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
HEALTH CARE-DRUGS
2,500 ABBOT LABORATORIES 157,381.25 163,906.25
14,000 AMGEN INC 259,439.50 757,750.00
18,500 BIOGEN INC. (b) 551,691.65 672,937.50
400 CARDINAL HEALTH INC. 29,424.00 30,050.00
17,500 DURA PHARMACEUTICALS INC (b) 692,100.55 802,812.50
20,500 ELAN CORP PLC-ADR (b) 625,284.55 1,049,343.75
19,000 LILLY (ELI) & CO 794,112.40 1,322,875.00
4,000 MERCK & CO INC. 357,490.00 425,000.00
1,700 PHARMACIA & UPJOHN INC. 55,345.71 62,262.50
35,500 PFIZER INC 354,583.00 2,646,968.75
2,400 SCHERING-PLOUGH 140,844.00 149,100.00
23,000 SMITHKLINE BEECHAM-SPONS ADR 691,310.00 1,183,062.50
----------------------- -----------------------
TOTAL HEALTH CARE-DRUGS 4,709,006.61 9,266,068.75 8.67%
HEALTH CARE-GENERAL
2,100 AMERICAN HOME PRODUCTS INC. 160,432.23 160,650.00
900 BAXTER INTERNATIONAL INC. 42,635.25 45,393.75
3,300 BRISTOL-KYERS SQUIBB CO 302,591.85 312,262.50
16,500 JOHNSON & JOHNSON 364,435.12 1,086,937.50
15,500 WARNER-LAMBERT CO 1,346,471.55 1,922,000.00
----------------------- -----------------------
TOTAL HEALTH CARE-GENERAL 2,216,566.00 3,527,243.75 3.30%
HOSPITAL SUPPLY & MANAGEMENT
500 AETNA INC 36,611.25 35,281.25
2,200 COLUMBIA/HCA HEALTHTRUST CORP 62,531.92 65,175.00
1,000 FPA MEDICAL MANAGEMENT INC (b) 23,750.00 18,625.00
500 GUIDANT CORP 29,436.25 31,125.00
69,000 HBO & CO 1,271,007.80 3,312,000.00
58,000 HEALTHSOUTH CORP (b) 491,910.00 1,609,500.00
23,000 MEDTRONIC INC. 171,646.13 1,203,187.50
17,500 STRYKER CORP 270,380.65 651,875.00
1,000 TENET HEALTH CARE 30,153.80 33,125.00
600 UNITED HEALTHCARE CORP 29,267.28 29,812.50
----------------------- -----------------------
TOTAL HOSPITAL SUPPLY & MANAGEMENT 2,416,695.08 6,989,706.25 6.54%
HOTELS & GAMING
400 ITT CORP (b) 31,161.52 33,150.00
20,500 MARRIOTT INTERNATIONAL INC 731,148.45 1,419,625.00
18,500 PROMUS HOTEL CORP (b) 557,547.45 777,000.00
----------------------- -----------------------
TOTAL HOTELS & GAMING 1,319,857.42 2,229,775.00 2.09%
HOUSEHOLD-GENERAL PRODUCTS
1,000 COLGATE-PALMOLIVE CO 63,903.80 73,500.00
18,000 PROCTOR & GAMBLE CO 728,181.20 1,436,625.00
----------------------- -----------------------
TOTAL HOUSEHOLD-GENERAL PRODUCTS 792,085.00 1,510,125.00 1.41%
See accompanying notes to investments in securities 5 (continued)
<PAGE>
CLEARWATER GROWTH FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
INSURANCE-LIFE
800 AMERICAN GENERAL CORP 41,298.00 43,250.00
500 AON CORP 27,655.00 29,312.50
600 CONSECO INC 27,373.50 27,262.50
12,000 EQUITABLE COMPANIES INC 461,539.95 597,000.00
700 SUNAMERICA INC. 27,885.76 29,925.00
----------------------- -----------------------
TOTAL INSURANCE-LIFE 585,752.21 726,750.00 0.68%
INSURANCE-PROPERTY & CASUALTY
11,000 ACE LTD 625,555.00 1,061,500.00
9,000 ALLSTATE CORP 559,336.40 817,875.00
13,500 AMERICAN INTERNATIONAL GROUP 466,630.50 1,468,125.00
600 CHUBB CORP 40,817.28 45,375.00
200 CIGNA CORP 31,837.00 34,612.50
19,000 EXEL LIMITED 523,635.00 1,204,125.00
300 GENERAL RE CORP 59,399.25 63,600.00
400 HARTFORD FINANCIAL SVCS GRP 32,399.00 37,425.00
77,000 MERCURY GENERAL CORP 1,645,980.30 4,254,250.00
24,000 MGIC INVESTMENT CORP 576,720.00 1,596,000.00
----------------------- -----------------------
TOTAL INSURANCE-PROPERTY & CASUALTY 4,562,309.73 10,582,887.50 9.90%
LEISURE TIME INDUSTRY
39,202 CENDANT CORPORATION (b) 350,020.76 1,347,553.28
2,200 DISNEY WALT 189,400.86 217,937.50
1,000 MATTEL INC 39,278.80 37,250.00
----------------------- -----------------------
TOTAL LEISURE TIME INDUSTRY 578,700.42 1,602,740.78 1.50%
MOTOR VEHICLE PARTS
300 EATON CORP 29,199.24 26,775.00 0.03%
MOTOR VEHICLES
2,000 CHRYSLER CORP 72,120.00 70,375.00
3,900 FORD MOTOR COMPANY 181,458.81 189,881.25
2,400 GENERAL MOTORS CORP 152,288.71 145,500.00
54,000 HARLEY DAVIDSON, INC. 691,935.20 1,478,250.00
----------------------- -----------------------
TOTAL MOTOR VEHICLES 1,097,802.72 1,884,006.25 1.76%
MULTIPLE INDUSTRY
1,700 ALLIED SIGNAL INC 63,195.80 66,193.75
800 CORNING INC 36,773.04 29,700.00
200 LOEWS CORP 22,624.50 21,225.00
1,400 MINNESOTA MINING & MFG CO 128,884.00 114,887.50
11,000 SAP ADS (c) 401,720.00 1,168,750.00
400 TEXTRON INC. 23,724.00 25,000.00
100 TRW INC 5,868.50 5,337.50
----------------------- -----------------------
TOTAL MULTIPLE INDUSTRY 682,789.84 1,431,093.75 1.34%
See accompanying notes to investments in securities 6 (continued)
<PAGE>
CLEARWATER GROWTH FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
PETROLEUM-DOMESTIC
1,100 ATLANTIC RICHFIELD CO 90,572.24 88,137.50
600 BURLINGTON RESOURCES INC 29,454.78 26,887.50
1,100 OCCIDENTAL PETROLEUM CORP 31,347.25 32,243.75
700 PHILLIPS PETROLEUM CO 34,579.51 34,037.50
600 TENNECO INC. 27,411.00 23,700.00
800 UNOCAL CORP 33,123.04 31,050.00
900 USX-MARATHON GROUP INC 32,735.25 30,375.00
----------------------- -----------------------
TOTAL PETROLEUM-DOMESTIC 279,223.07 266,431.25 0.25%
PETROLEUM-INTERNATIONAL
1,600 AMOCO CORP 148,346.08 136,200.00
13,665 BRITISH PETROLEUM PLC-ADR 677,577.17 1,088,929.68
2,100 CHEVRON CORP 180,769.68 161,700.00
8,200 EXXON CORP 512,736.16 501,737.50
2,600 MOBIL CORP 193,368.50 187,687.50
1,700 TEXACO INC 98,739.57 92,437.50
----------------------- -----------------------
TOTAL PETROLEUM-INTERNATIONAL 1,811,537.16 2,168,692.18 2.03%
PETROLEUM-SERVICES
500 BAKER HUGHES, INC. 23,780.00 21,812.50
11,500 CAMCO INTERNATIONAL INC 407,180.00 732,406.25
4,000 DRESSER INDUSTRIES INC 147,438.95 167,750.00
800 HALLIBURTON CO 50,123.04 41,550.00
21,000 SCHLUMBERGER LTD 572,707.95 1,690,500.00
30,500 TRANSOCEAN OFFSHORE INC 797,547.52 1,469,718.75
----------------------- -----------------------
TOTAL PETROLEUM-SERVICES 1,998,777.46 4,123,737.50 3.86%
PHOTOGRAPHIC EQUIPMENT
1,100 EASTMAN KODAK CO. 69,022.25 66,893.75 0.06%
PUBLISHING
900 GANNETT CO 48,672.72 55,631.25 0.05%
RAILROAD
500 BURLINGTON NORTHERN SANTA FE CORP 48,067.50 46,468.75
700 CSX CORP COM 38,429.51 37,800.00
1,200 NORFOLK SOUTHERN CORP 38,472.00 36,975.00
700 UNION PACIFIC CORP 41,779.50 43,706.25
----------------------- -----------------------
TOTAL RAILROAD 166,748.51 164,950.00 0.15%
RESTAURANTS
2,300 MCDONALD'S CORP 105,806.67 109,825.00 0.10%
RETAIL-FOOD STORES
700 ALBERTSON'S INC. 26,335.75 33,162.50
700 KROGER CO (b) 22,635.76 25,856.25
400 RITE AID CORP 24,336.52 23,475.00
800 SAFEWAY INC (b) 47,173.04 50,600.00
25,000 WALGREEN COMPANY 632,788.70 784,375.00
----------------------- -----------------------
TOTAL RETAIL-FOOD STORES 753,269.77 917,468.75 0.86%
See accompanying notes to investments in securities 7 (continued)
<PAGE>
CLEARWATER GROWTH FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
RETAIL - GENERAL MERCHANDISE
700 COSTCO COMPANIES INC (b) 27,518.75 31,237.50
700 DAYTON-HUDSON CORP 46,160.73 47,250.00
19,500 FEDERATED DEPARTMENT STORES (b) 513,045.00 839,718.75
35,000 KOHLS CORP (b) 1,171,431.25 2,384,375.00
800 MAY DEPARTMENT STORES CO 44,498.00 42,150.00
700 PENNEY J C INC 42,410.76 42,218.75
1,200 SEARS ROEBUCK & CO 55,159.56 54,300.00
4,600 WALMART STORES INC. 166,863.62 181,412.50
----------------------- -----------------------
TOTAL RETAIL - GENERAL MERCHANDISE 2,067,087.67 3,622,662.50 3.39%
RETAIL - SPECIALTY STORE
600 CVS CORP 37,761.00 38,437.50
1,050 GAP INC 39,067.00 37,209.38
25,750 HOME DEPOT INC. 50,381.91 1,516,031.25
900 TOYS R US INC. (b) 31,610.25 28,293.75
----------------------- -----------------------
TOTAL RETAIL-SPECIALTY STORE 158,820.16 1,619,971.88 1.52%
SAVINGS & LOANS
55,000 TCF FINANCIAL CORP 965,087.50 1,866,562.50 1.75%
SECURITIES BROKERS AND DEALERS
1,600 AMERICAN EXPRESS COMPANY 127,596.00 142,800.00
8,500 CMAC INVESTMENT CORPORATION 245,161.25 513,187.50
3,500 FANNIE MAE 178,928.75 199,718.75
21,500 FEDERAL HOME LOAN MORTGAGE CO 65,945.84 901,656.25
13,500 FRANKLIN RESOURCES INC. 683,519.05 1,173,656.25
500 MARSH & MCLENNAN COS 36,705.00 37,281.25
1,100 MERRILL LYNCH & CO 78,459.70 80,231.25
1,500 MORGAN ST DEAN WITTER DIS 82,039.95 88,687.50
19,000 MUTUAL RISK MANAGEMENT LTD 352,996.55 568,812.50
19,500 PRICE (T ROWE) ASSOCIATES 544,918.25 1,226,062.50
200 STUDENT LOAN MARKETING ASSN 28,837.00 27,825.00
3,828 TRAVELERS GROUP INC 184,962.47 206,233.50
----------------------- -----------------------
TOTAL SECURITIES BROKERS AND DEALERS 2,610,069.81 5,166,152.25 4.83%
TIMESHARING & SOFTWARE
300 AMERICA ONLINE INC (b) 23,905.50 26,756.25
1,000 AUTOMATIC DATA PROCESSING 52,653.80 61,375.00
5,000 COMPUTER SCIENCES CORP (b) 341,043.55 417,500.00
18,000 FISERV INC (b) 549,868.20 884,250.00
23,250 PAYCHEX INC 278,102.90 1,177,031.25
----------------------- -----------------------
TOTAL TIMESHARING & SOFTWARE 1,245,573.95 2,566,912.50 2.40%
TIRES & RUBBER PRODUCTS
500 GOODYEAR TIRE & RUBBER CO 32,667.50 31,812.50 0.03%
TOBACCO
1,100 RJR NABISCO HOLDINGS CORP 36,022.25 41,250.00
31,500 PHILIP MORRIS COS INC. 520,988.30 1,427,343.75
----------------------- -----------------------
TOTAL TOBACCO 557,010.55 1,468,593.75 1.37%
See accompanying notes to investments in securities 8 (continued)
<PAGE>
CLEARWATER GROWTH FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
UTIITIES - ELECTRIC
600 AMERICAN ELECTRIC POWER 28,667.28 30,975.00
800 CONSOLIDATED EDISON OF NY 27,723.04 32,800.00
1,200 DUKE POWER CO 58,309.56 66,450.00
1,300 EDISON INTERNATIONAL 33,715.50 35,343.75
500 FPL GROUP INC 26,336.25 29,593.75
1,400 P G & E CORPORATION 36,484.00 42,612.50
2,200 SOUTHERN CO 50,975.76 56,925.00
800 TEXAS UTILITY 28,673.04 33,250.00
----------------------- -----------------------
TOTAL UTIITIES - ELECTRIC 290,884.43 327,950.00 0.31%
UTILITIES - GAS & PIPELINE
1,000 ENRON CORP 38,497.50 41,562.50
1,000 WILLIAMS COMPANIES, INC. 25,623.75 28,375.00
----------------------- -----------------------
TOTAL UTILITIES - GAS & PIPELINE 64,121.25 69,937.50 0.07%
UTILITIES - TELEPHONE
5,300 A T & T CORPORATION 261,336.64 324,625.00
35,000 AIRTOUCH COMMUNICATIONS INC. (b) 1,048,159.20 1,454,687.50
1,800 AMERITECH CORPORATION/DEL 117,220.50 144,900.00
2,600 BELL ATLANTIC CORP 210,187.38 236,600.00
3,300 BELLSOUTH CORP 157,460.49 185,831.25
3,100 GTE CORP 134,454.75 161,975.00
1,800 MCI COMMUNICATIONS 65,756.34 77,062.50
3,000 SOUTHWESTERN BELL CORP 194,805.00 219,750.00
1,400 SPRINT CORP 75,027.82 82,075.00
1,600 US WEST INC (b) 64,796.00 72,200.00
2,200 WORLDCOM INC GA (b) 76,655.36 66,549.00
----------------------- -----------------------
TOTAL UTILITIES - TELEPHONE 2,405,859.48 3,026,255.25 2.83%
CASH EQUIVALENTS
REPURCHASE AGREEMENTS WITH STATE STREET
4,286,181.61 BANK, 4.25%, 1/2/98 (e) 4,286,181.61 4,286,181.61 4.01%
----------------------- ----------------------- ---------
TOTAL INVESTMENTS $64,154,250.44 116,074,498.80 108.62%
======================= ======================= =========
<FN>
Notes to Investments in Securities
(a) Securities are valued in accordance with procedures described in note 2
to the financial statements.
(b) Currently non-income producing.
(c) Security purchased on May 23, 1995 at a cost of $401,720 as part of a
private placement that has not been registered with the Securities and
Exchange Commission under the Securities Act of 1933. May be sold only
to dealers in that program or other accredited investors.
(d) At December 31, 1997, the cost for federal income tax purposes was
$64,154,250. The aggregate gross unrealized appreciation and
depreciation of investments in securities based on this cost were as
follows:
Gross unrealized appreciation 52,699,851.50
Gross unrealized depreciation (779,602.56)
----------------
Net unrealized appreciation $51,920,248.94
================
(e) Repurchase agreement acquired on 12/31/97 is collateralized by U.S.
government agency securities and interest due at maturity is
$1,012.02.
</FN>
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
CLEARWATER SMALL CAP FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
COMMON STOCKS
<S> <C> <C> <C> <C>
COMPUTER TECHNOLOGY
17,200 EN POINTE TECHNOLOGIES (b) 264,900.00 167,700.00
67,900 MTI TECHNOLOGY CORP (b) 188,648.50 899,675.00
171,300 ROCKY MOUNTAIN INTERNET INC. (b) 428,087.50 513,900.00
26,700 SYMIX SYSTEMS INC. (b) 112,868.75 413,850.00
----------------------- -----------------------
TOTAL COMPUTER TECHNOLOGY 994,504.75 1,995,125.00 4.89%
CONSUMER DISCRETIONARY
34,800 ANALYTICAL SURVEYS INC. (b) 432,212.50 1,191,900.00
29,500 BARRETT BUSINESS SVCS INC (b) 360,834.76 346,625.00
23,000 BOSTON ACOUSTICS INC COM 690,411.50 595,125.00
8,000 BRIDGESTREET ACCOMODATIONS (b) 72,000.00 81,250.00
11,900 BROWN GROUP INC. 206,586.53 158,418.75
23,380 BURLINGTON COAT FACTORY WRHS 318,166.67 384,308.75
67,300 CHILDRENS DISCOVERY CENTERS 360,439.90 656,175.00
22,200 DUCKWALL-ALCO STORES, INC. (b) 316,825.50 330,225.00
21,400 FINLAY ENTERPRISES INC. (b) 406,600.00 486,850.00
68,500 G-111 APPAREL GROUP LTD (b) 393,489.09 351,062.50
44,000 HEADWAY CORPORATE RESOURCES (b) 209,920.05 191,125.00
15,667 HERBALIFE INTERNATIONAL CL-B (b) 259,074.69 336,833.36
7,833 HERBALIFE INTERNATIONAL CL-A (b) 127,603.98 164,500.02
34,300 KENTEK INFORMATION SYSTEMS 212,783.35 231,525.00
43,000 LECHTERS INC. (b) 252,741.35 217,687.50
18,100 LEXFORD INC. (b) 411,973.51 624,450.00
21,700 M/A/R/C, INC. 260,472.17 390,600.00
33,900 WINSLOEW FURNITURE INC. (b) 385,989.50 491,550.00
----------------------- -----------------------
TOTAL CONSUMER DISCRETIONARY 5,678,125.05 7,230,210.88 17.70%
CONSUMER STAPLES
25,600 FLEMING COMPANIES, INC. 437,289.44 344,000.00
70,500 LAMAUR CORPORATION (b) 404,550.50 105,750.00
26,950 SCHULTZ SAV O STORES INC. 297,805.00 417,725.00
----------------------- -----------------------
TOTAL CONSUMER STAPLES 1,139,644.94 867,475.00 2.12%
ELECTRONICS TECHNOLOGY
34,400 AEHR TEST SYSTEMS (b) 240,200.00 275,200.00
15,000 CERPROBE CORP 194,817.40 260,625.00
34,450 CHECKPOINT SYS INC COM 522,920.45 602,875.00
14,000 QC OPTICS (b) 46,837.50 50,750.00
18,300 WEGENER CORP (b) 52,612.50 28,021.87
----------------------- -----------------------
TOTAL ELECTRONICS TECHNOLOGY 1,057,387.85 1,217,471.87 2.98%
See accompanying notes to investments in securities 1 (continued)
<PAGE>
CLEARWATER SMALL CAP FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
FINANCIAL SERVICES
27,600 AAMES FINANCIAL CORP 386,349.78 357,075.00
49,000 AMERICAN PHYSICIANS SERVICE GROUP (b) 208,250.00 349,125.00
6,834 ASTORIA FINANCIAL 245,758.64 380,995.50
18,370 FIDELITY BANKSHARES INC. 279,475.00 597,025.00
16,750 HENRY (JACK) & ASSOCIATES 144,200.63 456,437.50
36,800 KINNARD INVESTMENTS INC. (b) 214,731.25 257,600.00
18,300 LIBERTY FINANCIAL COMPANIES 352,777.00 690,825.00
53,010 PACIFIC CREST CAPITAL INC. (b) 382,815.00 967,432.50
46,600 PROPHET 21 INC (b) 198,050.00 489,300.00
14,512 QUEENS COUNTY BANCORP INC. 327,293.81 587,736.00
11,200 SUN BANCORP INC-NJ (b) 240,800.00 366,800.00
53,406 TIMBERLINE SOFTWARE CORP 304,833.00 657,564.45
----------------------- -----------------------
TOTAL FINANCIAL SERVICES 3,285,334.11 6,157,915.95 15.08%
HEALTH CARE
30,500 COLLABORATIVE CLINICAL RESEARCH INC (b) 213,920.00 154,406.25
58,000 COLORADO MEDTECH INC. 169,876.24 398,750.00
16,617 ICN PHARMACEUTICALS 256,343.76 811,117.31
65,000 STAR MULTI CARE SERVICES INC. (b) 372,703.90 357,500.00
----------------------- -----------------------
TOTAL HEALTH CARE 1,012,843.90 1,721,773.56 4.22%
INSURANCE
20,000 ACCEPTED INSURANCE COMPANIES 435,681.10 483,750.00
16,339 AMERUS LIFE HOLDINGS INC-A 530,014.43 602,500.63
15,300 PENN TREATY AMERICAN CORP (b) 247,301.55 485,775.00
6,900 RIGHTCHOICE MANAGED CARE CL A (b) 84,936.07 66,412.50
41,900 SEIBELS BRUCE GROUP INC. 293,300.00 314,250.00
----------------------- -----------------------
TOTAL INSURANCE 1,591,233.15 1,952,688.13 4.78%
MATERIALS AND PROCESSING
15,200 AMPCO-PITTSBURGH 185,435.00 297,350.00
31,300 CAMERON ASHLEY BUILDING PROD (b) 389,229.60 524,275.00
15,000 CONCORD FABRICS INC CL A (b) 126,375.00 136,875.00
43,900 EASCO INC 319,912.25 581,675.00
29,600 INSTEEL INDUSTRIES 247,755.00 203,500.00
32,800 INTERNATIONAL COMFORT PRODUCTS CORP (b) 233,323.27 274,700.00
10,000 LONE STAR TECHNOLOGIES (b) 342,830.30 283,750.00
18,400 MAVERICK TUBE CORP (b) 512,280.08 465,750.00
44,000 MERCER INTL INC-SBI 435,342.84 387,750.00
17,800 MILLER BUILDING SYSTEMS INC (b) 153,387.50 173,550.00
38,800 NORTHWEST PIPE COMPANY (b) 614,565.63 931,200.00
25,680 PIONEER COMPANIES INC. CL A (b) 177,000.00 337,050.00
29,800 SAXTON INC. (b) 211,300.00 204,875.00
20,800 SCHNITZER STEEL INDUSTRIES INC-A 515,861.25 583,700.00
27,400 SHAW GROUP INC. (b) 476,736.00 630,200.00
27,000 SPARTECH CORP 323,814.09 408,375.00
14,900 TEXAS INDUSTRIES INC. 405,539.00 670,500.00
34,765 UNIMARK GROUP INC. (b) 246,952.40 130,368.75
----------------------- -----------------------
TOTAL MATERIALS AND PROCESSING 5,917,639.21 7,225,443.75 17.69%
See accompanying notes to investments in securities 2 (continued)
<PAGE>
CLEARWATER SMALL CAP FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
ENERGY
7,400 ABRAXAS PETROLEUM CORP (b) 79,204.00 109,150.00
77,200 BOLT TECHNOLOGY CORP 137,867.88 530,750.00
38,500 DAILEY PETROLEUM SERVICES (b) 476,736.20 418,687.50
76,700 GREY WOLF (b) 223,978.59 412,262.50
18,750 HALTER MARINE GROUP INC. (b) 188,221.50 541,406.25
80,000 ICO INC 358,695.74 490,000.00
14,200 LUFKIN INDUSTRIES INC 313,595.13 507,650.00
8,500 MARINE DRILLING CO INC. 156,500.00 176,375.00
29,500 MIDCOAST ENERGY RESOURCES 587,360.75 636,093.75
143,500 NORTON DRILLING SERVICES, INC (b) 217,449.45 300,453.13
250,000 PONDER INDUSTRIES INC. (b) 402,350.00 445,312.50
25,500 SUPERIOR ENERGY SERVICES INC. (b) 242,077.50 258,187.50
21,500 TRIGEN ENERGY CORP 401,512.50 428,656.25
----------------------- -----------------------
TOTAL ENERGY 3,785,549.24 5,254,984.38 12.87%
PRODUCER DURABLES
27,500 ALIGN-RITE INTERNATIONAL (b) 356,838.71 350,625.00
16,900 ALPINE GROUP INC. (b) 305,391.50 316,875.00
45,350 AMERICAN HOMESTAR CORP 480,389.75 748,275.00
11,600 AMREP CORP (b) 69,767.41 68,150.00
31,100 ANTEC CORP (b) 308,944.08 485,937.50
42,500 ASTRO-MED INC NEW 358,466.88 340,000.00
13,800 C & D TECHNOLOGIES INC. 432,019.40 665,850.00
11,900 CURTIS-WRIGHT CORP 441,160.00 432,118.75
58,425 FREQUENCY ELECTRONICS INC 374,406.88 934,800.00
24,800 GLEASON CORP 432,870.02 668,050.00
64,100 GNI GROUP INC. (b) 427,953.77 312,487.50
39,000 GRADCO SYSTEMS INC. (b) 185,534.45 287,625.00
21,000 GRAHAM CORP (b) 447,575.00 320,250.00
39,600 HERLEY INDUSTRIES INC. (b) 234,888.18 477,675.01
22,600 KEITHLEY INSTRUMENTS INC 307,462.88 196,337.50
16,000 MATTHEWS INTL CORP 258,500.00 704,000.00
19,000 NUMEREX CORP - CL A (b) 114,000.00 118,750.00
16,600 PENN ENGINEERING & MFG CO 358,911.25 398,400.00
18,500 SALIENT 3 COMMUNICATIONS-A 291,072.99 228,937.50
16,450 SSE TELECOM INC. 178,276.00 78,137.50
19,200 TRANSTECHNOLOGY CORP 312,000.00 543,600.00
200 WHITEHALL CORP (b) 2,255.00 3,600.00
----------------------- -----------------------
TOTAL PRODUCER DURABLES 6,678,684.15 8,680,481.26 21.26%
UTILITIES
16,000 CTG RESOURCES 373,941.85 417,000.00
97,500 EL PASO ELECTRIC COMPANY 576,561.61 712,968.75
19,500 NUI CORP 373,964.73 559,406.25
25,100 PROVIDENCE ENERGY CORP 464,950.75 547,493.75
17,750 YORK RESEARCH CORP (b) 140,600.73 149,765.63
----------------------- -----------------------
TOTAL UTILITIES 1,930,019.67 2,386,634.38 5.84%
See accompanying notes to investments in securities 3 (continued)
<PAGE>
CLEARWATER SMALL CAP FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1997
FACE PERCENT
AMOUNT MARKET OF
OR SHARES SECURITY COST VALUE (a) NET ASSETS
PREFERRED STOCK
FINANCIAL SERVICES
9,000 IRWIN FINANCIAL CORP CAPITAL TRUST 225,000.00 249,750.00 0.61%
CONVERTIBLE PREFERRED
FINANCIAL SERVICES
11,050 RIGGS NATIONAL 300,730.25 319,068.75 0.78%
CASH EQUIVALENTS
REPURCHASE AGREEMENTS WITH STATE STREET
3,110,144.53 BANK, 4.25%, 1/2/98 (d) 3,110,144.53 3,110,144.53 7.62%
----------------------- ----------------------- ---------
TOTAL INVESTMENTS $36,706,840.80 48,369,167.44 118.44%
======================= ======================= =========
<FN>
Notes to Investments in Securities
(a) Securities are valued in accordance with procedures described in note 2
to the financial statements.
(b) Currently non-income producing.
(c) At December 31, 1997, the cost for federal income tax purposes was
$36,706,841. The aggregate gross unrealized appreciation and
depreciation of investments in securities based on this cost were as
follows:
Gross unrealized appreciation 13,482,707.20
Gross unrealized depreciation (1,820,381.56)
-----------------------
Net unrealized appreciation $11,662,325.64
=======================
(d) Repurchase agreement acquired on 12/31/97 is collateralized by U.S.
government agency securities and interest due at maturity is $734.34.
</FN>
</TABLE>
4
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE 12/31/97 ANNUAL REPORT TO SHAREHOLDERS
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS
</LEGEND>
<SERIES>
<NUMBER> 1
<NAME> CLEARWATER GROWTH FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 64154251
<INVESTMENTS-AT-VALUE> 116074499
<RECEIVABLES> 87717
<ASSETS-OTHER> 1832
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 116164048
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 9304793
<TOTAL-LIABILITIES> 9304793
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 54939981
<SHARES-COMMON-STOCK> 5047760
<SHARES-COMMON-PRIOR> 5252780
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (975)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 51920249
<NET-ASSETS> 106859255
<DIVIDEND-INCOME> 749020
<INTEREST-INCOME> 198921
<OTHER-INCOME> 0
<EXPENSES-NET> 1012399
<NET-INVESTMENT-INCOME> (64458)
<REALIZED-GAINS-CURRENT> 8928506
<APPREC-INCREASE-CURRENT> 16922059
<NET-CHANGE-FROM-OPS> 25786107
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 8987082
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 24071
<NUMBER-OF-SHARES-REDEEMED> 230550
<SHARES-REINVESTED> 1459
<NET-CHANGE-IN-ASSETS> 12937107
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 57061
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1012399
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1013399
<AVERAGE-NET-ASSETS> 103523596
<PER-SHARE-NAV-BEGIN> 17.88
<PER-SHARE-NII> (.01)
<PER-SHARE-GAIN-APPREC> 5.08
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 1.78
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 21.17
<EXPENSE-RATIO> 0.98
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE 12/31/97 ANNUAL REPORT TO SHAREHOLDERS
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS
</LEGEND>
<SERIES>
<NUMBER> 2
<NAME> CLEARWATER SMALL CAP FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 36706842
<INVESTMENTS-AT-VALUE> 48369167
<RECEIVABLES> 446941
<ASSETS-OTHER> (42426)
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 48773682
<PAYABLE-FOR-SECURITIES> 758060
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 7177213
<TOTAL-LIABILITIES> 7935273
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<PAID-IN-CAPITAL-COMMON> 29166125
<SHARES-COMMON-STOCK> 2679104
<SHARES-COMMON-PRIOR> 2571795
<ACCUMULATED-NII-CURRENT> 0
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<ACCUMULATED-NET-GAINS> 9958
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 11662326
<NET-ASSETS> 40838409
<DIVIDEND-INCOME> 347182
<INTEREST-INCOME> 121556
<OTHER-INCOME> 0
<EXPENSES-NET> 534172
<NET-INVESTMENT-INCOME> (65434)
<REALIZED-GAINS-CURRENT> 7097859
<APPREC-INCREASE-CURRENT> 6508576
<NET-CHANGE-FROM-OPS> 13541001
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 7022467
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 144088
<NUMBER-OF-SHARES-REDEEMED> 36779
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 8064877
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 18195
<OVERDIST-NET-GAINS-PRIOR> 0
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<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 534172
<AVERAGE-NET-ASSETS> 39622652
<PER-SHARE-NAV-BEGIN> 12.74
<PER-SHARE-NII> (.02)
<PER-SHARE-GAIN-APPREC> 5.14
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 2.62
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<PER-SHARE-NAV-END> 15.24
<EXPENSE-RATIO> 1.35
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
