<PAGE> 1
10/31/95 ANNUAL REPORT #5
GLOBAL FIXED INCOME
CHAIRMAN'S LETTER
- ------------------------------------------------------------------------------
Dear Shareholder:
We are pleased to present this Annual Report for the Global Fixed Income Fund
for the fiscal year ended October 31, 1995.
Global bond yields fell during the year -- particularly in the second half -- as
non-inflationary growth in some countries and the need for economic stimulus in
others kept interest rates from rising. We anticipate continued firmness in
bond prices as inflation remains generally under control in global markets.
As always, we recommend that investors take a long-term, disciplined approach to
the markets. By leaving your money invested for the long term -- five years or
more -- you are better able to ride out any bumpy periods.
We appreciate your confidence in Vista. If you have any questions about your
Fund -- or the information included in this report -- please call us at
1-800-34-VISTA.
We look forward to hearing from you.
Sincerely,
/s/ FERGUS REID
- -------------------
Fergus Reid
Chairman
<PAGE> 2
- -------------------------------------------------------------
FUND COMMENTARY
VISTA GLOBAL FIXED INCOME FUND
The Fund benefited from declines in bond yields declined during the year
ending October 31, 1995. These declines almost completely reversed the yield
increases recorded for the previous period. As a result, the Fund posted a total
return of 9.54% for the fiscal year. Exposure to longer-term bonds was reduced
steadily throughout the second half of the Fund's fiscal year to begin locking
in respectable returns. The move to shorter maturities resulted in a more
conservative portfolio stance, which proved to impede performance relative to
the industry average, as global bond markets continued their rally. The
magnitude of this rally was greater than we expected and came during a period
when forecasted growth rates were being exceeded, which normally adversely
affects bond performance.
The Fund's positioning in bonds with longer-dated maturities proved to
be correct, although the decision to begin booking profits proved to be
premature. Markets remained resilient in the face of strong Gross Domestic
Product (GDP), a measure of economic growth, as there was no apparent pick up in
inflation. The Federal Reserve was also perceived to have a bias to lower
short-term interest rates, which further relieved the market's concerns about
inflation.
The Fund's positions in European bond markets were a positive influence
on total return. During the period, the U.S. dollar declined against the
Deutschemark and traded within a wide range. The Fund maintained greater
positions in dollar-based investments relative to the benchmark to avoid
excessive exposure to foreign currencies. This move reduced risk but was the
main contributor to relative underperformance against global indices.
Given the outlook for inflation, we anticipate further steady yield
declines, which should produce another period of respectable returns. Current
market sentiment will continue until there are signs of a pickup in economic
activity, which we do not expect to show in data releases until the middle of
1996.
<TABLE>
<CAPTION>
- --------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
With Sales Without Sales
CLASS A SHARES Charge Charge
<S> <C> <C>
One Year 4.61% 9.54%
Since Inception (12/31/92) 4.98% 6.70%
CLASS B SHARES With CDSC* Without CDSC
One Year 3.82% 8.82%
Since Inception (11/5/93) 2.11% 4.05%
</TABLE>
*Assumes a 5% CDSC for the one-year period and a 4%
CDSC for the period since inception.
- --------------------------------------------------------
- -------------------------------------------------------------------------------
Growth of $10,000
[GRAPH]
<TABLE>
<CAPTION>
Vista Global Fixed Lipper General World
Income Fund Income Fund Index
<S> <C> <C>
12/31/92 9550 10000.00
9631.175 10125.73
9738.29432472691162 10303.48
9870.69675002861741 10580.08
9999.73805388265007 10750.89
9983.32921730774611 10961.59
9893.01310668424218 10976.33
10009.9748379947948 11163.62
10322.7865516821321 11548.60
10401.2122804698406 11502.64
10371.719239977015 11852.07
10322.4239964410026 11684.72
12/31/93 10346.0857133382885 12301.21
10382.6827660527739 12673.19
10247.5588563701732 12420.87
10209.7155875128295 11912.76
10153.7719404579647 11968.25
10084.6100190471454 12012.47
10141.920365117503 11770.56
10152.021879425389 11998.60
10121.7173365017311 12253.52
10172.2249080411609 12101.78
10303.5445940436784 12083.57
10212.6309652727047 11741.94
12/31/94 10220.7121767190135 11752.34
10339.5812944800597 11598.87
10555.1595210744562 11767.08
10928.2386745457344 12035.87
11001.6450081212072 12309.87
11223.9634247159134 12616.81
11261.5157187019518 12737.33
11277.2294615652568 13078.09
11093.1328985266449 13068.55
11244.210803716103 13297.46
10/31/95 11475.00 13186.47
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT
RETURN AND PRINCIPAL WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN
CLASS A SHARES OF THE VISTA GLOBAL FIXED INCOME FUND AND THE LIPPER GENERAL
WORLD INCOME FUND INDEX FROM DECEMBER 31, 1992 TO OCTOBER 31, 1995. THE FUND'S
PERFORMANCE INCLUDES A 4.50% SALES CHARGE AND ASSUMES THE REINVESTMENT OF ALL
DIVIDENDS AND CAPITAL GAINS. THE INDEX'S PERFORMANCE DOES NOT INCLUDE A SALES
CHARGE AND HAS BEEN ADJUSTED TO REFLECT REINVESTMENT OF ALL DIVIDENDS AND
CAPITAL GAINS ON MUTUAL FUNDS INCLUDED IN THE BENCHMARK.
THE LIPPER GENERAL WORLD INCOME FUND INDEX FUNDS INCLUDED IN THE INDEX
ARE REPRESENTATIVE OF THE MARKET.
- -------------------------------------------------------------------------------
3
<PAGE> 3
Vista Mutual Funds
Vista Global Fixed Income Fund
Statement of Assets and Liabilities October 31, 1995
- ------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investment in Portfolio, at value (Note1) $1,921,928
Receivable for Fund shares sold 8,818
Receivable from Distributor (Note 2) 12,233
Unamortized organization costs (Note1) 10,100
----------
Total Assets 1,953,079
----------
LIABILITIES:
Dividends payable 677
Accrued liabilities:
Distribution fees 578
Shareholder servicing fees 227
Other 27,308
----------
Total Liabilities 28,790
----------
NET ASSETS:
Paid-in-capital 1,881,569
Accumulated undistributed net investment income (loss) 102,576
Accumulated undistributed net realized gain on
investment transactions (59,856)
----------
Net Assets $1,924,289
==========
Class A Shares $1,515,328
==========
Class B Shares $408,961
==========
Shares of beneficial interest outstanding (no par value;
unlimited number of shares authorized)
Class A Shares 142,330
==========
Class B Shares 38,464
==========
Class A Shares
Net asset value and redemption price per share (net assets/
shares outstanding) $10.65
==========
Maximum offering price per share
(net asset value per share/95.50%) $11.15
==========
Class B Shares
Net asset value and offering price per share (net
assets/shares outstanding $10.63
==========
</TABLE>
See notes to financial statements.
<PAGE> 4
Vista Mutual Funds
Vista Global Fixed Income Fund
Statement of Operations For the Year Ended October 31, 1995
- ------------------------------------------------------------------------------
<TABLE>
<S> <C>
NET INVESTMENT INCOME:
Investment income from Portfolio $118,476
Expenses from Portfolio (21,110)
Foreign taxes withheld from Portfolio (503)
----------
Total investment income net of expenses from Portfolio 96,863
----------
EXPENSES:
Distribution fees (Note 2)
Class A 3,697
Class B 2,661
Administration fee (Note 2) 916
Shareholder servicing fees (Note 2) 4,583
Sub-administration fee (Note 2) 916
Printing and postage 978
Professional fees 14,108
Registration fees 2,808
Transfer agent fees 57,001
Trustee fees (Note 2) 102
Miscellaneous expenses 3,303
Amortization of organization costs (Note 1) 4,668
----------
Total expenses 95,741
----------
Less fees waived (Note 2) (3,902)
Less expenses borne by the Distributor (Note 2) (76,547)
----------
Net expenses 15,292
----------
Net investment income 81,571
----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) from portfolio on:
Investment transactions-net 45,354
Foreign currency transactions-net 94,739
Change in unrealized appreciation (depreciation) from portfolio-net (56,039)
----------
Net realized and unrealized gain on investments and foreign currency
transactions 84,054
----------
Net increase in net assets resulting from operations $165,625
==========
</TABLE>
See notes to financial statements.
<PAGE> 5
Vista Mutual Funds
Vista Global Fixed Income Fund
Statement of Changes in Net Assets For the periods indicated
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
------------------------------
Year Year
Ended Ended
10/31/95 10/31/94
------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $81,571 $83,781
Realized gain (loss) from Portfolio-net 140,093 (81,481)
Change in unrealized appreciation/depreciation on
investments and foreign exchange from portfolio-net (56,039) (35,416)
------------------------------
Net increase (decrease) in net assets resulting
from operations 165,625 (33,116)
------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM: (Note 1B)
Net investment income
Class A (74,010) (53,531)
Class B (15,822) (2,695)
------------------------------
(89,832) (56,226)
------------------------------
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST (Note 4):
Proceeds from shares sold
Class A 668,603 1,196,850
Class B 327,311 375,505
Reinvestment of dividends
Class A 57,572 51,609
Class B 14,292 2,317
Payments for shares redeemed
Class A (638,879) (2,156,145)
Class B (227,135) (94,984)
------------------------------
Net increase (decrease) in net assets from transactions
in shares of beneficial interest 201,764 (624,848)
------------------------------
Total increase (decrease) in net assets 277,557 (714,190)
NET ASSETS:
Beginning of year 1,646,732 2,360,922
------------------------------
End of year $1,924,289 $1,646,732
==============================
</TABLE>
See notes to financial statements.
<PAGE> 6
VISTA MUTUAL FUND
NOTES TO FINANCIAL STATEMENTS October 31, 1995
- ------------------------------------------------------------------------------
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES -- Mutual Fund Group (the
"Trust") was organized as a Massachusetts business trust on May 11, 1987, and
is registered under the Investment Company Act of 1940, as amended, (the "1940
Act") as an open-end management investment company. Vista Global Fixed Income
Fund (GFI) is a separate series of the Trust. The Fund offers two classes of
shares. Class "A" Shares are sold with a front end sales load and Class "B"
Shares, which were first available on November 4, 1993, are sold with a
contingent deferred sales load. All classes of shares have equal rights as to
earnings, assets and voting privileges except that each class may bear
different distribution and fund servicing expenses, and each class has
exclusive voting rights with respect to its distribution plan.
Vista Global Fixed Income Fund utilizes the Master Feeder Fund Structure.
Effective October 16, 1995, the offshore partner, Global Bond Fund, withdrew
its partnership interests from the Global Fixed Income Portfolio in the form of
securities. At the time of the withdrawal, the offshore partner represented a
98.2% interest in the Portfolio. Subsequent to the withdrawal of the offshore
partner, the Portfolio temporarily invested its assets in a U.S. Treasury Bill
prior to reinvesting in various global fixed income securities.
The Trust seeks to achieve the Fund's investment objective by investing all of
the investable assets of the Fund in the Global Fixed Income Portfolio (the
"Portfolio") which, like the fund, is a management investment company having
the same investment objective as the Fund. The Fund's percentage interest in
the Portfolio at October 31,1995, was 99.99%.
The Following is a summary of significant accounting policies followed by the
Fund:
A. Valuation of Investments -- The Fund records its investments in the
Portfolio at value. Securities of the Portfolio are recorded at value.
B. Investment Income, Expenses, and Distributions to Shareholders -- The
Fund records daily its pro-rata share of the Portfolio's income, expenses, and
realized and unrealized gains and losses. In addition, the Fund accrues its
own expenses daily as incurred. Expenses directly attributable to the Fund are
charged to the Fund; other expenses are allocated proportionately among each
Fund within the Trust in relation to the net assets of each Fund or on another
reasonable basis. Distributions to shareholders are recorded on the
ex-dividend date. In calculating net asset value per share of each class,
investment income, realized and unrealized gains and losses and expenses other
than class specific expenses, are allocated daily to each class of shares based
upon the proportion of net assets of each class at the beginning of each day.
The amount of dividends and distributions from net investment income and net
realized capital gains is determined in accordance with federal income tax
regulations, which may differ from generally accepted accounting principles.
To the extent these "book/tax" differences are permanent in nature (i.e., that
they will result from other than timing of recognition -- "temporary
differences"), such amounts are reclassified within the capital accounts based
on its federal tax-basis treatment. The reclassifications made for the Fund
are as follows: paid in capital and undistributed net realized gain (loss)
were decreased by $6,349 and $96,518 respectively and accumulated undistributed
net investment income was increased by $102,867. These permanent differences
are primarily due to the redesignation of foreign exchange gains and losses for
tax purposes.
C. Federal Income Taxes -- The Fund is treated as a separate taxable entity
for Federal Income tax purposes. The Fund's policy is to comply with the
provisions of the Internal Revenue Code applicable to regulated investment
companies and to distribute to shareholders all of the Fund's distributable net
income, including any net realized gain on investments. In addition, the Fund
intends to make distributions
<PAGE> 7
VISTA MUTUAL FUND
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- ------------------------------------------------------------------------------
as required to avoid excise taxes. Accordingly, no provisions for Federal
income or excise tax are necessary.
D. Organization Costs -- Organization and initial registration costs
incurred in connection with establishing the Fund have been deferred and are
being amortized on a straight-line basis over a sixty-month period beginning at
the commencement of operations of the Fund.
E. Foreign Currency Translations -- The books and records of the
Portfolio are maintained in U.S. dollars, the foreign currency translation
policy is more fully discussed in the notes to those financial statements.
2. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A. Administration Fees -- Pursuant to an Administration Agreement, The
Chase Manhattan Bank, N.A. (the "Administrator") serves as administrator of the
Fund. The Administrator receives from the Fund a fee computed daily and paid
monthly at an annual rate equal to 0.05% of the respective average daily net
assets of the Fund. The Administrator may, from time to time, waive all or a
portion of its fees. For the year ended October 31, 1995, the Administrator
waived fees of $916.
B. Shareholder Servicing Fees -- The Trust has adopted an Administrative
Services Plan which, among other things, provides that the Trust on behalf of
the Fund may obtain the services of one or more Shareholder Servicing Agents.
For its services, each Shareholder Servicing Agent will receive fees determined
by a formula based upon the average number of accounts serviced and the number
of transactions processed by such Shareholder Servicing Agent during the period
for which payment is being made, and any out-of-pocket expenses incurred,
provided that such fees will not exceed, on an annualized basis, 0.25% of the
average daily net assets of the Fund. Chase and its affiliates have been the
only Shareholder Servicing Agent of the Fund. The Shareholder Servicing Agent
may, from time to time, waive all or a portion of its fees. For the year ended
October 31, 1995, the Shareholder Servicing Agent waived fees of $2,070.
C. Distribution and Sub-administration Fees -- Pursuant to a Distribution
and Sub-administration Agreement, Vista Broker-Dealer Services, Inc. ("VBDS" or
the "Distributor"), a wholly-owned subsidiary of Concord Holding Corp., a
wholly owned subsidiary of The BISYS Group, acts as the Trust's exclusive
underwriter and promotes and arranges for the sale of the Fund's shares. In
addition, the distributor provides certain sub-administration services to the
Trust, including providing officers, clerical staff and office space for an
annual fee of 0.05% of the average daily net assets of the Fund. The
Sub-Administrator, may from time to time, waive all or a portion of its fee.
For the year ended October 31, 1995 the Sub-Administrator waived fees of $916.
The Trustees have adopted Distribution Plans (the "Distribution Plans") for
both Class A and Class B for the Fund in accordance with Rule 12b-1 under the
1940 Act.
The Class A Distribution Plans provide that the Fund shall pay distribution
fees, including payments to the Distributor at annual rates not to exceed 0.25%
of the average daily net assets of the Fund for distribution services. The
Class B Distribution Plans provide that the Fund shall pay distribution fees
including payments to the Distributor at an annual rate not to exceed 0.75% of
the average daily net assets of the Class B Shares of the Fund for distribution
services.
For the year ended October 31, 1995, the Distributor voluntarily assumed
$76,547 in expenses on behalf of the Vista Global Fixed Income Fund.
<PAGE> 8
VISTA MUTUAL FUND
NOTES TO FINANCIAL STATEMENT October 31, 1995 (continued)
- ------------------------------------------------------------------------------
D. Other -- Certain officers of the Trust are officers of VBDS or of its
parent corporation, BISYS. In addition, the Portfolio has entered into
contracts with the Chase Manhattan Bank, N.A. for Investment Advisory and
Custodian services.
On August 27, 1995, the Chase Manhattan Corporation and Chemical Banking
Corporation announced an agreement in principle to merge which was approved by
shareholders of both corporations on December 11, 1995, subject to approval of
regulators.
3. INVESTMENT TRANSACTION -- The increase and decrease in the Fund's
investment in its related Portfolio during the year ended October 31, 1995,
were $1,064,317 and $999,038, respectively.
4. TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST -- Transactions in shares of
beneficial interest for the periods indicated, are as follows:
<TABLE>
<CAPTION>
Class A Class B **
Year Ended Year Ended
---------- ----------
10/31/95 10/31/94 10/31/95 10/31/94
-------- -------- -------- --------
<S> <C> <C> <C> <C>
CLASS A:
Share sold . . . . . . . . . . . . . . 64,837 116,088 31,154 36,805
Shares issued in reinvestment of . . .
distributions . . . . . . . . . . . . 5,497 5,023 1,364 227
Shares redeemed . . . . . . . . . . . . (61,739) (211,713) (21,704) (9,382)
-------- --------- -------- -------
Net increase in shares of beneficial
interest outstanding . . . . . . . . 8,595 (90,602) 10,814 27,650
Outstanding shares at:
Beginning of period . . . . . . . . . 133,735 224,337 27,650 --
------- ------- ------ ------
End of period . . . . . . . . . . . . 142,330 133,735 38,464 27,650
======= ======= ====== ======
</TABLE>
- ---------------
** Commenced offering of shares on 11/4/93
5. FEDERAL INCOME TAX MATTERS -- At October 31, 1995, the Vista Global Fixed
Income Fund had a capital loss carryover of approximately $60,000, this will be
available to offset capital gains arising through October 31, 2002. During the
year the Fund utilized approximately $43,000 of capital losses brought forward.
To the extent that these carryover losses are used to offset future gains, the
gains so offset will not be distributed to shareholders.
6. RETIREMENT PLAN -- During the year ended October 31, 1995, the Trust
adopted an unfunded noncontributory defined benefit pension plan covering all
independent directors of the Trust, who have served as an independent director
of the Trust, or other Vista Fund, for at least five years at the time of
retirement. Benefits under this plan are based on compensation and years of
service. Management has determined that the accrual for prior service costs is
not material.
<PAGE> 9
VISTA MUTUAL FUND
NOTES TO FINANCIAL STATEMENT October 31, 1995 (continued)
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OF BENEFICIAL INTEREST
OUTSTANDING
Throughout Each Period Indicated
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year ended 12/31/92* Year 11/4/93*
------------------------- through ended through
10/31/95 10/31/94 10/31/93 10/31/95 10/31/94
-------- -------- -------- -------- --------
Class A Class B
----------------------------------------- ------------------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of Period . . . . . . $ 10.21 $ 10.52 $ 10.00 $ 10.20 $ 10.48
------- ------- ------- ------- -------
Income From Investment Operations
Net Investment Income (Loss) . . . . . . 0.353 0.464 0.300 0.298 0.339
Net Gains or (Losses) on Securities
(both realized and unrealized) . . . . 0.610 (0.495) 0.550 0.590 (0.382)
----- -------- ----- ----- --------
Total from Investment Operations . . . . 0.963 (0.031) 0.850 0.888 (0.043)
----- -------- ----- ----- --------
Less Distributions
Dividends from net investment income . . 0.523 0.279 0.300 0.463 0.237
Distributions from paid in CAPITAL . . . -- -- 0.030 -- --
--- -- ----- --- ---
Total distributions . . . . . . . . . . 0.523 0.279 0.330 0.463 0.237
----- ----- ----- ----- -----
Net Asset Value, End of Period . . . . . . . . . $ 10.65 $ 10.21 $10.52 $ 10.63 $10.20
======= ======= ====== ======= ======
Total Return (1) . . . . . . . . . . . . . . . . 9.54% (0.66%) 10.42% 8.82% (0.51%)
===== ======== ====== ===== ========
Ratio/Supplemental Data**
Net Assets, End of Period (000 omitted) . . $ 1,515 $ 1,365 $ 2,361 $ 409 $ 282
------- ------- -------- ------- -------
Ratio of Expenses to Average Net Assets # . . . 1.86% 1.86% 1.88% 2.50% 2.50%
Ratio of Net Investment Income (Loss)
to Average Net Assets # . . . . . . . . . . 4.58% 3.83% 3.29% 3.92% 3.79%
Ratio of Expense without waivers and
assumption of expenses to Average Net
Assets# (2) . . . . . . . . . . . . . . . . 2.86% 2.86% 2.86% 3.36% 3.36%
Ratio of Net Investment Income (Loss)
without waivers and assumption of
expenses to Average Net Assets # . . . . . . 3.58% 2.83% (0.09%) 3.06% 2.93%
</TABLE>
- ---------------
(1) Total return figures do not include the effect of any sales load.
(2) Not to exceed the maximum statutory expense ratio.
* Commenced offering class of shares.
** Ratios include the Fund's share of Portfolio income and expenses, as
appropriate.
# Short periods have been annualized.
<PAGE> 10
REPORT OF INDEPENDENT ACCOUNTS
TO THE TRUSTEES
AND SHAREHOLDERS OF
MUTUAL FUND GROUP
In our opinion, the accompanying statement of assets and liabilities and the
related statements of operations and of changes in net assets and the selected
per share data and ratios for a share of beneficial interest outstanding
present fairly, in all material respects, the financial position of Vista
Global Fixed Income Fund, one of the portfolios constituting Mutual Fund Group
(hereafter referred to as the "Trust"), at October 31, 1995, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the selected per share data and
ratios for a share of beneficial interest outstanding for the periods
presented, in conformity with generally accepted accounting principles. These
financial statements and selected per share data and ratios for a share of
beneficial interest outstanding (hereafter referred to as "financial
statements") are the responsibility of the Trust's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in
accordance with generally accepted auditing standards which require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, NY 10036
December 15, 1995
<PAGE> 11
Global Fixed Income Portfolio
Portfolio of Investments October 31, 1995
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Issuer Amount Value
- ------ --------- -----
<S> <C> <C>
Short-Term Investment -
U.S. Obligation -
U.S. Treasury Bill, due 11/02/95 ................ $1,951,000 $1,950,718
(Cost $1,950,718)
</TABLE>
See notes to financial statements.
<PAGE> 12
Global Fixed Income Portfolio
Statement of Assets and Liabilities
October 31, 1995
- ------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investment securities, at value (Note 1) $1,950,718
Cash 121,358
-------------
Total Assets 2,072,076
-------------
LIABILITIES:
Accrued liabilities:
Advisory fees (Note 2) 36,447
Administration fees (Note 2) 2,431
Organization costs payable 8,979
Other accrued expenses 102,290
-------------
Total Liabilities 150,147
-------------
NET ASSETS APPLICABLE TO INVESTORS'
BENEFICIAL INTERESTS $1,921,929
=============
Cost of Investments $1,950,718
-------------
</TABLE>
See notes to financial statements.
<PAGE> 13
Global Fixed Income Portfolio
Statement of Operations
For the year ended October 31, 1995
- ------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT INCOME (Note 1):
Interest $5,901,793
Foreign taxes withheld (25,500)
-------------
Total investment income 5,876,293
-------------
EXPENSES:
Advisory fees (Note 2) 686,268
Administration fees (Note 2) 45,751
Accounting fees 81,151
Custodian fees (Note 2) 83,431
Professional fees 67,137
Trustee fees 3,928
Miscellaneous expense 44,252
Amortization of organization costs (Note 1) 37,511
-------------
Total expenses 1,049,429
-------------
Net investment income 4,826,864
-------------
REALIZED AND UNREALIZED GAIN:
Net realized gain on:
Investments 3,327,402
Foreign currency transactions 314,790
-------------
Net realized gain 3,642,192
-------------
Change in net unrealized appreciation/depreciation on:
Investments 240,314
Foreign currency contracts and foreign
currency translations 209,044
-------------
Change in net unrealized appreciation/
depreciation 449,358
-------------
Net realized and unrealized gain 4,091,550
-------------
Net increase in net assets resulting from operations $8,918,414
=============
</TABLE>
See notes to financial statements.
<PAGE> 14
Global Fixed Income Portfolio
Statement of Changes in Net Assets For the Periods Indicated
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Year
Ended Ended
10/31/95 10/31/94
------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $4,826,864 $3,394,228
Net realized gain (loss) on investments 3,642,192 (2,416,837)
Change in net unrealized appreciation/depreciation
on investments and foreign currency translations 449,358 (637,725)
------------------------------
Increase in net assets resulting from operations 8,918,414 339,666
------------------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTERESTS:
Contributions 42,291,581 81,601,783
Withdrawals (141,255,554) (49,030,865)
------------------------------
Net increase (decrease) from transactions in
investors' beneficial interests (98,963,973) 32,570,918
------------------------------
Net increase (decrease) in net assets (90,045,559) 32,910,584
NET ASSETS:
Beginning of period 91,967,488 59,056,904
------------------------------
End of period $1,921,929 $91,967,488
==============================
</TABLE>
See notes to financial statements.
<PAGE> 15
NOTES TO FINANCIAL STATEMENTS October 31, 1995
- -------------------------------------------------------------------------------
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES -- The Global Fixed
Income Portfolio ("GFP") (the "Portfolio") is registered under the Investment
Company Act of 1940, as amended, as a non-diversified, open end management
investment company organized as a trust under the laws of the State of New
York, USA. The declaration of trust permits the Trustees to issue beneficial
interests in the Portfolio. The GFP commenced operations on December 31, 1992.
Effective October 16, 1995, the offshore partner, Global Bond Fund, withdrew
its partnership interests from the Global Fixed Income Portfolio in the form of
securities. At the time of the withdrawal, the offshore partner represented a
98.2% interest in the Portfolio. Subsequent to the withdrawal of the offshore
partner, the Portfolio temporarily invested its assets in a U.S. Treasury Bill
prior to reinvesting in various global fixed income securities. Concurrent
with the withdrawal of the offshore partner, the Portfolio fully amortized the
remaining unamortized organization costs.
The following is a summary of significant accounting policies followed by
the Portfolio:
A. Valuation of Investments -- Purchased options are valued at the last
sale price on the exchange on which they are primarily traded.
Bonds and other fixed income securities (other than short-term
obligations), including listed issues, are valued on the basis of
valuations furnished by a pricing service. In making such
valuations, the pricing service utilizes both dealer-supplied
valuations electronic data processing techniques that take into
account appropriate factors such as institutional-sized trading in
similar groups of securities, yield, quality, coupon rate, maturity,
type of issue, trading characteristics and other market data,
without exclusive reliance upon quoted prices. Short-term
obligations are valued at amortized cost if acquired with fewer than
61 days to maturity, or at value based on quoted exchange or
over-the-counter prices, until the 61st day prior to maturity and
thereafter by amortizing the value on the 61st day to par at
maturity. Portfolio securities for which there are no such
quotations or valuations are valued at fair value as determined in
good faith by or at the direction of the Trustees.
B. Security Transactions and Investment Income -- Investment
transactions are accounted for on the trade date (the date the order
to buy or sell is executed). Securities gains and losses are
calculated on the identified cost basis. Interest income is accrued
as earned.
C. Repurchase agreements -- It is the Trust's policy that repurchase
agreements are fully collateralized by U.S. Treasury and Government
agency securities. All collateral is held by the Trust's custodian
bank, sub-custodian or a bank with which the custodian bank has
entered into a sub-custodian agreement or is segregated in the
Federal Reserve Book Entry System. In connection with transactions
in repurchase agreements, if the seller defaults and the value of
the collateral declines, or if the seller enters into an insolvency
proceeding, realization of the collateral by the Trust may be
delayed or limited.
D. Foreign Currency Translations -- The books and records of the
Portfolio are maintained in U.S. dollars. Foreign currency amounts
are translated into U.S. dollars at the official exchange rates, or
at the mean of the current bid and asked prices, of such currencies
against the U.S. dollar as quoted by a major bank, on the following
basis:
(a) Market value of investment securities and other assets and
liabilities: at the closing rate of exchange at the balance
sheet date.
(b) Purchases and sales of investment securities, income and
expenses: at the rates of exchange prevailing on the
respective dates of such transactions.
<PAGE> 16
NOTES TO FINANCIAL STATEMENT October 31, 1995 (continued)
- -------------------------------------------------------------------------------
Although the net assets of the Portfolio are presented at the
foreign exchange rates and market values at the close of the year,
the Portfolio does not isolate that portion of the results of
operations arising as a result of changes in the foreign exchange
rates from the fluctuations arising from changes in the market
prices of the securities held at year end. Similarly, the Portfolio
does not isolate the effect of changes in foreign exchange rates
from the fluctuations arising from changes in the market prices of
securities sold during the year. Accordingly, realized foreign
currency gains (losses) are included in the reported net realized
gains on security transactions.
Reported realized foreign exchange gains or losses arise from
disposition of foreign currency, currency gains or losses realized
between the trade and settlement dates on securities transactions,
and the difference between the amounts of interest, and foreign
withholding taxes recorded on the Portfolio's books on the
transaction date and the U.S. dollar equivalent of the amounts
actually received or paid. Unrealized foreign exchange gains and
losses arise from changes (due to the changes in the exchange rate)
in the value of foreign currency and other assets and liabilities
denominated in foreign currencies which are held at period end.
E. Forward Foreign Currency Exchange Contracts -- The Portfolio may
enter into forward foreign currency contracts (obligations to
purchase or sell foreign currency in the future on a date and price
fixed at the time the contracts are entered into) to hedge the
Portfolio against fluctuations in the value of its assets or
liabilities due to change in the value of foreign currencies. Each
day the forward contract is open, changes in the value of the
contract are recognized as unrealized gains or losses by "marking to
market". When the forward contract is closed, or the delivery of
the currency is made or taken, the Portfolio records a realized gain
or loss equal to the difference between the proceeds from (or cost
of) the closing transaction and the Portfolio's basis in the
contract. The Portfolio is subject to off-balance sheet risk to the
extent of the value of the contracts for purchases of currency, and
in an unlimited amount for sales of currency.
F. Federal Income Taxes and Distributions to Investors -- The Portfolio
intends to qualify as a partnership and therefore net income and net
realized gains are taxed to the partners. The investors in the
Portfolio must take into account their proportionate share of the
Portfolio's income, gains, losses, deductions, credits and tax
preference items in computing their federal income tax liability,
without regard to whether they have received any cash distributions
from the Portfolio. The Portfolio does not intend to distribute to
investors its net investment income or its net realized gains, if
any. It is intended that the Portfolio will be managed in such a
way that investors in the Portfolio will be able to satisfy the
requirements of subchapter M of the Internal Revenue Code to be
taxed as regulated investment companies.
2. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A. Investment Advisory Fees -- The Chase Manhattan Bank, N.A.
("Chase"), a direct wholly-owned subsidiary of The Chase Manhattan
Corporation, is the Portfolio's investment adviser (the "Adviser")
and custodian (the "Custodian"). The Adviser manages the assets of
the Portfolio pursuant to an Advisory Agreement, and for such
services, is paid an annual fee computed daily and paid monthly
based on an annual rate equal to .75% of the GFP's average daily net
assets.
B. Custodial Fees -- Chase, as Custodian, provides safekeeping services
for the Portfolio's securities. Compensation for such services are
presented in the Statement of Operations as custodian fees.
<PAGE> 17
NOTES TO FINANCIAL STATEMENT October 31, 1995 (continued)
- -------------------------------------------------------------------------------
A. Administration Fee -- Pursuant to an Administration Agreement,
effective October 16, 1995, Chase ("the Administrator") and prior
thereto The Chase Manhattan Trust Corporation Limited provides
certain administration services to the Portfolio. For these
services, the Administrator and the predecessor administrator,
receives from the Portfolio a fee computed at an annual rate equal
to 0.05% of the Portfolio's average daily net assets.
B. Other -- The Portfolio's organizational costs payable are comprised
of liabilities owed to the Funds' Distributor, Vista Broker Dealer
Services (VBDS).
On August 27, 1995, the Chase Manhattan Corporation and Chemical Banking
Corporation announced an agreement in principle to merge, which was
approved by shareholders of both corporations on December 11, 1995,
subject to the approval of regulators.
3. INVESTMENT TRANSACTIONS
Purchase and sales of investment (excluding short-term investments) for the
year ended October 31, 1995, were as follows:
<TABLE>
<S> <C>
Purchases (excluding U.S. Government) . . . . . . . . . $247,272,202
Sales (excluding U.S. Government) . . . . . . . . . . . 302,720,511
Purchases of U.S. Government . . . . . . . . . . . . . 88,889,704
Sales of U.S. Government . . . . . . . . . . . . . . . 102,275,881
</TABLE>
The portfolio turnover rate for the GFP Portfolio for this period was 624%.
<PAGE> 18
REPORT OF INDEPENDENT ACCOUNTS
TO THE TRUSTEES
AND BENEFICIAL INTEREST HOLDERS OF
GLOBAL FIXED INCOME PORTFOLIO
In our opinion, the accompanying statement of assets of liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets present fairly, in all material respects, the financial
position of Global Fixed Income Portfolio (the "Portfolio") at October
31,1995, the results of its operations for the year then ended and the changes
in its net assets for each of the two years in the period then ended, in
conformity with generally accepted accounting principles. These financial
statements are the responsibility of the Portfolio's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in
accordance with generally accepted auditing standards which require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits, which included
confirmation of securities at October 31,1995 by correspondence with the
custodian, provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, NY 10036
December 15, 1995
<PAGE> 19
---------------------------------------------------------------
VISTASM FAMILY OF MUTUAL FUNDS CHAIRMAN'S LETTER
December 12, 1995
Dear Shareholder:
We are pleased to present this Annual Report for
the Equity Fund, Bond Fund and Short-Term Bond Fund
for the fiscal year ended October 31, 1995.
U.S. MARKETS ROAR TO LIFE IN 1995
The U.S. financial markets roared to life in
1995 as investors correctly anticipated that the
economy would undergo a "soft landing" on the heels
of the Fed's rate hikes in 1994. All in all, it was
an outstanding year for U.S. equity investors -- one
of the best of the past century. Bond investors also
fared well, with the yield on 30-year bonds dropping
from 7.96% to 6.32% over the 12-month period,
sending the value of bonds soaring.
STRONG STOCK AND BOND SELECTIONS BOOST INVESTMENT
RETURNS
The Vista funds performed well during the period
under review -- a result of both the positive
economic environment for the U.S. financial markets
and timely stock and bond selection decisions by the
fund managers. Given the sizeable gains in the U.S.
stock and bond markets during the past year, Vista
fund managers are cautiously optimistic about these
markets in the months ahead.
As always, we recommend that investors take a
long-term, disciplined approach to the markets. By
leaving your money invested for the long
term -- five years or more -- you should be able to
ride out bumpy periods.
We appreciate your confidence in Vista. If you
have any questions about your Fund, or the
information included in this report, please call us
at 1-800-34-VISTA.
We look forward to hearing from you.
Sincerely,
/s/ FERGUS REID
----------------
Fergus Reid
Chairman
INVESTMENTS IN MUTUAL FUNDS ARE SUBJECT TO RISK,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. IN
ADDITION, THEY ARE NOT DEPOSITS, OBLIGATIONS OF,
ENDORSED OR GUARANTEED BY CHASE, AND ARE NOT INSURED
BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENT AGENCY.
- ---------------------------------------
CONTENTS
CHAIRMAN'S LETTER 1
FUND COMMENTARY 2-4
PORTFOLIO OF INVESTMENTS 5-9
FINANCIAL STATEMENTS 10-12
NOTES TO FINANCIAL
STATEMENTS 13-16
PER SHARE DATA 17-18
1
<PAGE> 20
- -------------------------------------------------------
FUND COMMENTARY
VISTA EQUITY FUND
For the fiscal year ended October 31, 1995, the Vista
Equity Fund had a total return of 20.41%.
In late 1994, uncertainty dominated the stock market
as economic signals remained unclear. Economic conditions
soon began to improve, however, characterized by low
inflation, solid corporate earnings results and a firmer
U.S. dollar.
In the second and third quarters of 1995, the market
climbed to record highs as the threat of inflation
dissipated and on lower short-term interest rates. Cyclical
issues soared on economic news, while technology issues
outperformed on very strong earnings results. The market
was further helped as the dollar stabilized against major
foreign currencies. The fiscal period ended on a negative
note for equities on disappointing third-quarter earnings
results in the cyclical area and mixed economic data.
Going forward, we see the most promise in the basic
industry, capital goods, technology and transportation
sectors; we also like some consumer cyclical and financial
issues. Overall, we believe that the Fund is positioned to
perform well in the months ahead as economic conditions
remain positive for growth stocks.
<TABLE>
<CAPTION>
--------------------------------------
AVERAGE ANNUAL TOTAL RETURN
SINCE INCEPTION
1 YEAR 3 YEARS 11/30/90
--------- --------- ----------------
<S> <C> <C>
20.41% 11.98% 14.12%
--------------------------------------
</TABLE>
GROWTH OF $10,000
[GRAPHIC HERE]
<TABLE>
<CAPTION>
Equity Fund Lipper Growth Fund Index
<S> <C> <C>
11/30/90 10000 10000
10300 10349.38
10703.60 11045.22
11405.15 11860.43
11675.75 12145.27
11656.1 12173.11
12140.09 12704.71
11525.02 11957.43
12108.84 12630.41
12498.12 12993.31
12313.73 12895.89
12497.87 13108.87
12023.91 12558.39
12/31/91 13517.89 14034.86
13221.51 14013.17
13283.68 14262.48
12972.83 13813.35
13177.92 13793.04
13292.51 13940.42
13021.66 13541.35
13599.64 13987.25
13351.20 13674.09
13534.83 13885.74
13643.89 14132.50
14089.27 14861.70
12/31/92 14221.3 15106.07
14221.3 15321.96
14265.2 15121.18
14585.62 15554.61
14210.49 15133.80
14530.45 15734.66
14587.82 15783.82
14510.11 15764.62
15020.79 16435.59
14931.98 16541.44
15244.69 16814.98
15155.34 16473.61
12/31/93 15447.95 16915.16
16053.99 17500.90
15614.32 17213.09
14971.44 16409.17
15114.83 16540.37
15329.9 16620.08
15034.77 16050.41
15419.35 16504.84
16056.32 17208.74
15608.04 16837.99
15910.29 17158.78
15378.33 16505.74
12/31/94 15482.3 16649.40
15651.59 16710.07
16359.53 17327.74
16770.44 17852.71
17080.15 18358.16
17699.55 18913.62
18120.75 19763.46
18915.38 20718.63
19055.61 20937.34
19485.65 21558.77
10/31/95 19156.98 21272.66
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES ARE REDEEMED,
THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN THE VISTA
EQUITY FUND AND THE LIPPER GROWTH FUND INDEX FROM NOVEMBER 30, 1990 TO OCTOBER
31, 1995. THE FUND'S PERFORMANCE ASSUMES THE REINVESTMENT OF ALL DIVIDENDS AND
CAPITAL GAINS. THE INDEX'S PERFORMANCE HAS BEEN ADJUSTED TO REFLECT REINVESTMENT
OF ALL DIVIDENDS AND CAPITAL GAINS ON MUTUAL FUNDS INCLUDED IN THE BENCHMARK.
THE LIPPER GROWTH FUND INDEX, AN EQUALLY-WEIGHTED PERFORMANCE INDICATOR, TRACKS
THE TOTAL RETURNS OF THE 30 LARGEST GROWTH FUNDS IN THE INDUSTRY. FUNDS INCLUDED
IN THE LIPPER GROWTH FUND INDEX ARE REPRESENTATIVE OF THE MARKET.
- -------------------------------------------------------------------------------
2
<PAGE> 21
---------------------------------------------------------------
FUND COMMENTARY
VISTA BOND FUND
For the fiscal year ended October 31, 1995, the Vista
Bond Fund had a total return of 15.83%.
During the first half of the period, from October 31,
1994 through April 30, 1995, the Federal Reserve decided to
increase short-term interest rates in an effort to stem
higher inflation. As a result, yields on Treasury bills and
other short-term bonds rose, causing bond prices to decline.
The higher interest rates, however, began to negatively
affect the economic recovery. Then, late in the year and
into early 1995, interest rates -- and bond yields -- began
to turn lower as fears of an overheating U.S. economy and of
renewed inflation eased.
Beginning in May 1995, the U.S. bond market began to
rally as investors became convinced of an economic slowdown
and scrambled to invest in the bond market; the general view
was that the Fed would ease rates, thereby sending bond
values higher. In July, the Fed cut short-term interest
rates, which immediately sent bond prices higher; however,
stronger-than-expected economic data began to emerge. For
the remainder of the period, the bond market continued to
gain steadily as interest rates remained stable. The economy
continued to exhibit signs of slow growth and low inflation
-- a positive combination for bonds.
Going forward, we expect interest rates to continue to
remain in a fairly tight trading range and feel the economic
environment will continue to support higher bond prices with
slow economic growth and moderate inflation. These factors
should help to provide the Fund with good buying
opportunities in the future.
<TABLE>
<CAPTION>
- ----------------------------------------
AVERAGE ANNUAL TOTAL RETURN
SINCE INCEPTION
1 YEAR 3 YEARS 11/30/90
--------- --------- -----------------
<S> <C> <C>
15.83% 7.68% 9.14%
--------------------------------------
</TABLE>
GROWTH OF $10,000
[GRAPH HERE]
<TABLE>
<CAPTION>
Bond Fund Lipper Corp Debt BBB Index
<S> <C> <C>
11/30/90 10000.00 10000
10000.00 10157.51
10191.00 10278.54
10286.59 10400.68
10337.72 10484.13
10465.74 10625.06
10504.85 10693.59
10482.47 10663.75
10612.58 10795.29
10849.77 11046.20
11064.00 11299.32
11161.61 11397.70
11272.68 11491.10
12/31/91 11649.76 11877.97
11502.86 11752.51
11540.05 11822.15
11485.62 11782.36
11544.79 11844.26
11745.05 12085.22
11915.63 12262.07
12232.89 12600.30
12326.81 12716.36
12512.28 12871.11
12316.18 12644.52
12283.00 12660.55
12/31/92 12480.59 12871.67
12740.70 13152.43
12995.28 13463.03
13043.63 13545.93
13133.75 13647.62
13128.98 13680.78
13399.71 13988.06
13476.76 14117.94
13763.48 14447.33
13829.13 14489.33
13871.89 14590.47
13717.21 14421.91
12/31/93 13776.42 14519.73
13970.02 14770.09
13671.29 14448.99
13388.78 14037.25
13281.01 13868.69
13351.11 13831.11
13242.20 13773.08
13470.21 14007.96
13492.22 14063.23
13304.69 13868.69
13274.57 13823.92
13244.28 13785.79
12/31/94 13339.64 13853.22
13589.34 14072.63
13876.70 14392.63
13968.49 14505.93
14154.47 14760.71
14738.67 15398.49
14859.43 15404.02
14787.68 15365.33
14965.25 15584.19
15128.43 15758.28
10/31/95 15376.60 15810.78
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES ARE REDEEMED, THEY
MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN THE
VISTA BOND FUND AND THE LIPPER CORPORATE DEBT BBB INDEX FROM NOVEMBER 30, 1990
TO OCTOBER 31, 1995. THE FUND'S PERFORMANCE ASSUMES THE REINVESTMENT OF ALL
DIVIDENDS AND CAPITAL GAINS. THE INDEX'S PERFORMANCE HAS BEEN ADJUSTED TO
REFLECT REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS ON MUTUAL FUNDS
INCLUDED IN THE BENCHMARK.
THE LIPPER CORPORATE DEBT BBB INDEX, AN EQUALLY-WEIGHTED PERFORMANCE INDICATOR,
TRACKS THE TOTAL RETURNS OF THE 30 LARGEST CORPORATE DEBT FUNDS IN THE
INDUSTRY. FUNDS INCLUDED IN THE LIPPER CORPORATE DEBT BBB INDEX ARE
REPRESENTATIVE OF THE MARKET.
- --------------------------------------------------------------------------------
3
<PAGE> 22
- -------------------------------------------------------
FUND COMMENTARY
VISTA SHORT-TERM BOND FUND
For the fiscal year ended October 31, 1995, the
Vista Short-Term Bond Fund had a total return of 7.37%.
During the first half of the period, from October
31, 1994 through April 30, 1995, the Federal Reserve decided
to increase short-term interest rates in an effort to stem
higher inflation. As a result, yields on Treasury bills and
other short-term bonds rose, causing bond prices to
decline. The higher interest rates, however, began to
negatively affect the economic recovery. Then, late in the
year and into early 1995, interest rates -- and bond yields
- -- began to turn lower as fears of an overheating U.S.
economy and of renewed inflation eased.
Beginning in May 1995, the U.S. bond market began to
rally as investors became convinced of an economic slowdown
and scrambled to invest in the bond market; the general view
was that the Fed would ease rates, thereby sending bond
values higher. In July, the Fed cut short-term interest
rates, which immediately sent bond prices higher; however,
stronger-than-expected economic data began to emerge. For
the remainder of the period, the bond market continued to
gain steadily as interest rates remained stable. The
economy continued to BENCHMARK. exhibit signs of slow
growth and low inflation -- a positive combination for
bonds.
Going forward, we expect interest rates to continue
to remain in a fairly tight trading range and feel the
economic environment will continue to support higher bond
prices with slow economic growth and moderate inflation.
These factors should help to provide the Fund with good
buying opportunities in the future.
<TABLE>
<CAPTION>
- -------------------------------------
AVERAGE ANNUAL TOTAL RETURN
SINCE INCEPTION
1 YEAR 3 YEARS 11/30/90
- --------- --------------------------
<S> <C> <C>
7.37% 4.81% 5.81%
- -------------------------------------
</TABLE>
GROWTH OF $10,000
[GRAPH HERE]
<TABLE>
<CAPTION>
Short-Term Bond Fund Lipper Short Investment Grade Debt Index
<S> <C> <C>
11/30/90 10000.00 10000
10070.00 10098.66
10131.00 10170.10
10211.81 10247.49
10262.66 10335.94
10344.38 10443.95
10403.88 10518.79
10438.73 10548.56
10517.49 10648.07
10616.48 10801.16
10693.91 10927.03
10782.29 11038.44
10860.60 11154.11
12/31/91 10989.26 11335.26
10981.05 11288.48
11016.52 11331.00
11026.27 11321.64
11115.32 11407.54
11191.74 11525.76
11280.62 11661.84
11371.01 11822.58
11437.47 11919.54
11516.58 12031.80
11469.51 11945.90
11476.26 11923.79
12/31/92 11543.23 12025.85
11643.02 12172.13
11704.54 12295.45
11746.87 12349.03
11798.59 12423.87
11792.82 12425.57
11855.44 12542.94
11883.39 12582.06
11947.72 12700.28
11986.48 12745.36
12012.44 12784.48
12034.95 12771.72
12/31/93 12067.06 12832.10
12121.96 12925.65
12094.41 12831.25
12078.78 12718.99
12064.30 12648.40
12098.22 12656.05
12145.64 12659.45
12207.89 12757.26
12245.89 12799.78
12259.43 12771.71
12297.74 12789.57
12298.98 12757.25
12/31/94 12353.81 12739.39
12457.69 12875.47
12573.34 13049.82
12644.04 13124.66
12715.06 13243.73
12864.12 13491.22
12935.80 13572.02
12996.24 13604.34
13056.96 13698.74
13116.66 13768.48
10/31/95 13204.02 13880.74
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES ARE REDEEMED, THEY
MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN THE VISTA
SHORT-TERM BOND FUND AND THE LIPPER SHORT INVESTMENT GRADE DEBT INDEX FROM
NOVEMBER 30, 1990 TO OCTOBER 31, 1995. THE FUND'S PERFORMANCE ASSUMES THE
REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS. THE INDEX'S PERFORMANCE HAS
BEEN ADJUSTED TO REFLECT REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS ON
MUTUAL FUNDS INCLUDED IN THE THE LIPPER SHORT INVESTMENT GRADE DEBT INDEX, AN
EQUALLY-WEIGHTED PERFORMANCE INDICATOR, TRACKS THE TOTAL RETURNS OF THE 30
LARGEST SHORT INVESTMENT GRADE DEBT FUNDS IN THE INDUSTRY. FUNDS INCLUDED IN THE
LIPPER
SHORT INVESTMENT GRADE DEBT INDEX ARE REPRESENTATIVE OF THE MARKET.
- --------------------------------------------------------------------------------
4
<PAGE> 23
VISTA EQUITY FUND
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ----------------------------------------- -------- ------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 97.6%
COMMON STOCK -- 97.6%
Aerospace -- 3.5%
AlliedSignal, Inc. ...................... 9,400 $ 399,500
General Motors Class H................... 14,500 609,000
Loral Corp. ............................. 16,800 497,700
United Technologies, Corp. .............. 4,800 426,000
------------
1,932,200
------------
Agriculture -- 1.6%
Case Corp. .............................. 10,500 400,312
Deere & Co. ............................. 5,400 482,625
------------
882,937
------------
Airlines -- 0.5%
AMR Corp.*............................... 4,300 283,800
------------
Automotive -- 3.2%
Chrysler Corp. .......................... 7,602 392,453
Echlin, Inc. ............................ 16,300 582,725
Ford Motor Company....................... 16,500 474,375
General Motors Corp. .................... 7,300 319,375
------------
1,768,928
------------
Banking -- 5.3%
Bank of New York Company, Inc. .......... 14,400 604,800
Citicorp................................. 14,200 921,225
First Bank System Inc. .................. 7,800 388,050
First Interstate Bankcorp................ 3,500 451,500
NationsBank Corp. ....................... 5,400 355,050
Norwest Corp. ........................... 8,500 250,750
------------
2,971,375
------------
Chemicals -- 3.1%
Air Products & Chemicals, Inc. .......... 10,000 516,250
duPont (EI) deNemours and Co. ........... 12,800 798,400
Eastman Chemical Co. .................... 6,700 398,650
------------
1,713,300
------------
Computer Software -- 2.2%
Computer Associates International Inc. .. 12,750 701,250
General Motors Corp., Class E............ 10,600 499,525
------------
1,200,775
------------
Computers/Computer Hardware -- 5.9%
Apple Computer Inc. ..................... 9,400 341,338
Compaq Computer Corp.*................... 22,400 1,248,800
Sun Microsystems, Inc.*.................. 21,700 1,692,600
------------
3,282,738
------------
Construction Machinery -- 1.3%
Caterpillar Inc. ........................ 12,500 701,563
------------
Consumer Products -- 2.5%
Black & Decker Corp. .................... 17,100 579,262
Procter & Gamble Co. .................... 4,600 372,600
Whirlpool Corp. ......................... 8,000 424,000
------------
1,375,862
------------
<CAPTION>
Issuer Shares Value
- ----------------------------------------- -------- ------------
<S> <C> <C>
Diversified -- 1.4%
ITT Corp. ............................... 2,600 $ 318,500
Textron, Inc. ........................... 6,500 446,875
------------
765,375
------------
Electronics/Electrical Equipment -- 3.3%
General Electric Co. .................... 5,400 341,550
Hewlett-Packard Co. ..................... 4,000 370,500
Texas Instruments Inc. .................. 16,300 1,112,475
------------
1,824,525
------------
Environmental Services -- 0.7%
Browning-Ferris Industries, Inc. ........ 12,800 372,800
------------
Financial Services -- 4.3%
American General Delaware................ 17,000 558,875
Dean Witter, Discover & Co. ............. 9,300 462,675
Donaldson Lufkin & Jenrette Inc.*........ 10,000 297,500
Federal Home Loan Mortgage Corp. ........ 5,000 346,250
Federal National Mortgage Assoc.......... 6,900 723,638
------------
2,388,938
------------
Food/Beverages -- 5.8%
Anheuser-Busch Companies, Inc. .......... 5,000 330,000
Archer Daniels - Midland Corp. .......... 16,275 262,434
Coca-Cola Co. ........................... 4,800 345,000
Coca-Cola Enterprises, Inc. ............. 11,000 292,875
ConAgra, Inc. ........................... 11,500 444,188
PepsiCo., Inc. .......................... 9,200 485,300
Philip Morris Companies, Inc. ........... 5,300 447,850
Quaker Oats Co. ......................... 8,300 283,238
Sara Lee Corp. .......................... 10,700 314,313
------------
3,205,198
------------
Health Care -- 3.4%
Baxter International Inc. ............... 14,000 540,750
Columbia/HCA Healthcare Corp. ........... 9,000 442,125
Manor Care, Inc. ........................ 12,600 412,650
Tenet Healthcare Corp.*.................. 27,000 482,625
------------
1,878,150
------------
Insurance -- 4.1%
Allstate Corp. .......................... 8,806 323,621
American International Group Inc. ....... 7,650 645,469
Chubb Corp. ............................. 5,300 476,337
St. Paul Companies, Inc. ................ 9,600 487,200
Transamerica Corp. ...................... 5,000 338,750
------------
2,271,377
------------
Manufacturing -- 3.6%
Eaton Corp. ............................. 5,300 271,625
Johnson Controls Inc. ................... 13,600 792,200
Kennametal Inc. ......................... 8,200 255,225
Varity Corp.*............................ 18,500 670,625
------------
1,989,675
------------
Metals/Mining -- 3.1%
Aluminum Co. of America (ALCOA).......... 14,400 734,400
Inco, Ltd. .............................. 20,100 690,938
Phelps Dodge Corp. ...................... 5,000 316,875
------------
1,742,213
------------
</TABLE>
See notes to financial statements.
5
<PAGE> 24
VISTA EQUITY FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ----------------------------------------- -------- ------------
<S> <C> <C>
Oil & Gas -- 7.8%
Amoco Corp. ............................. 6,800 $ 434,350
British Petroleum PLC, ADR............... 5,000 441,250
Halliburton Company...................... 19,600 813,400
Mobil Corp. ............................. 7,600 765,700
Panhandle Eastern Corp. ................. 34,100 861,025
Phillips Petroleum Co. .................. 8,500 274,125
Unocal Corp. ............................ 14,800 388,500
Williams Companies, Inc. ................ 9,100 351,487
------------
4,329,837
------------
Paper/Forest Products -- 3.6%
Champion International Corp. ............ 15,900 850,650
Mead Corp. .............................. 9,100 524,387
Willamette Industries Inc. .............. 10,700 620,600
------------
1,995,637
------------
Pharmaceuticals -- 3.4%
Abbot Laboratories,...................... 7,500 298,125
Allergan, Inc. .......................... 18,000 528,750
Schering-Plough Corp. ................... 8,000 429,000
Upjohn Company........................... 6,200 314,650
Warner-Lambert Co. ...................... 3,800 323,475
------------
1,894,000
------------
Printing & Publishing -- 1.0%
Harcourt General, Inc. .................. 14,200 562,675
------------
Restaurants/Food Service -- 0.7%
McDonald's Corp. ........................ 9,100 373,100
------------
Retailing -- 6.8%
American Stores Co. ..................... 14,300 427,212
Circuit City Stores, Inc. ............... 19,000 634,125
Dayton-Hudson Corp. ..................... 9,700 666,875
J.C. Penney Company, Inc. ............... 6,500 273,812
Kroger Co.*.............................. 21,000 700,875
May Department Stores Inc. .............. 13,000 510,250
Mercantile Stores Inc. .................. 5,500 246,812
Sears Roebuck & Co. ..................... 9,500 323,000
------------
3,782,961
------------
<CAPTION>
Issuer Shares Value
- ----------------------------------------- -------- ------------
<S> <C> <C>
Shipping/Transportation -- 2.7%
Conrail Inc. ............................ 8,300 $ 570,625
CSX Corp. ............................... 7,400 619,750
Ryder System, Inc. ...................... 12,000 289,500
------------
1,479,875
------------
Steel -- 0.7%
USX-US Steel Group, Inc. ................ 14,000 418,250
------------
Telecommunications -- 5.4%
AT & T Corp. ............................ 7,400 473,600
Ameritech Corp. ......................... 5,500 297,000
Frontier Corp. .......................... 12,500 337,500
GTE Corp. ............................... 14,000 577,500
MCI Communications Corp. ................ 17,000 423,938
NYNEX Corp. ............................. 6,800 319,600
Tele-Communications Inc., Class A*....... 14,200 241,400
U S West, Inc. .......................... 7,000 333,375
------------
3,003,913
------------
Tire & Rubber -- 0.5%
Goodyear Tire & Rubber, Inc. ............ 7,800 296,400
------------
Toys & Games -- 0.9%
Mattel, Inc. ............................ 17,000 488,750
------------
Utilities -- 5.3%
CINergy Corp. ........................... 11,500 326,312
CMS Energy Corp. ........................ 17,000 469,625
FPL Group Inc. .......................... 16,900 707,688
Nipsco Industries Inc. .................. 11,900 434,350
Pinnacle West Capital Corp. ............. 23,000 632,500
Southern Co. ............................ 15,000 358,125
------------
2,928,600
------------
TOTAL INVESTMENTS --
(COST $43,220,276)..................... 97.6% $ 54,105,727
============
- ---------------
* = Non-income producing security.
ADR = American Depository Receipts.
</TABLE>
See notes to financial statements.
6
<PAGE> 25
VISTA BOND FUND
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Issuer Amount Value
- --------------------------------------- ----------- ------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 97.6%
CORPORATE BONDS -- 26.7%
Airlines -- 2.5%
AMR Corp.,
9.880%, due 06/15/20.................. $ 370,000 $ 428,179
AMR Corp.,
10.000%, due 02/01/01................. 880,000 996,864
------------
1,425,043
------------
Banking -- 2.3%
Bankers Trust of New York,
8.250%, due 07/02/96.................. 1,000,000 1,013,930
First Chicago,
9.875%, due 08/15/00.................. 250,000 283,405
------------
1,297,335
------------
Chemicals -- 0.9%
duPont (EI) deNemours,
8.650%, due 12/01/97.................. 500,000 524,985
------------
Computers/Computer Hardware -- 0.9%
International Business Machines,
7.000%, due 10/30/25.................. 500,000 491,250
------------
Electronics/Electrical
Equipment -- 2.4%
General Electric Co.,
7.875%, due 05/01/96.................. 1,360,000 1,372,335
------------
Financial Services -- 8.2%
Associates Corp., N.A.,
7.920%, due 11/19/98.................. 250,000 262,228
CIT Group Holdings,
8.750%, due 04/15/98.................. 500,000 529,840
Commercial Credit,
5.900%, due 09/01/03.................. 500,000 479,650
Ford Motor Credit Corp.,
6.250%, due 11/08/00.................. 500,000 497,500
Ford Motor Credit Corp.
9.850%, due 02/27/96.................. 1,000,000 1,011,430
General Motors Acceptance Corp.,
6.300%, due 09/10/97.................. 300,000 301,152
General Motors Acceptance Corp.,
8.800%, due 04/04/96.................. 400,000 404,340
Lehman Brothers Holdings,
7.625%, due 07/15/99.................. 300,000 308,775
Merrill Lynch,
7.000%, due 04/27/08.................. 500,000 503,560
Morgan Stanley Group,
7.500%, due 09/01/99.................. 400,000 414,828
------------
4,713,303
------------
Food/Beverage -- 0.7%
Philip Morris Companies, Inc.,
9.250%, due 12/01/97.................. 400,000 423,568
------------
<CAPTION>
Principal
Issuer Amount Value
- --------------------------------------- ----------- ------------
<S> <C> <C>
Oil & Gas -- 1.9%
BP America Inc.,
8.750%, due 02/01/03.................. $ 500,000 $ 569,735
Tenneco Credit,
10.125%, due 12/01/97................. 500,000 538,250
------------
1,107,985
------------
Shipping/Transportation -- 1.5%
Hertz Corp.,
6.625%, due 07/15/00.................. 575,000 573,361
Ryder System, Inc.,
7.540%, due 09/20/99.................. 250,000 260,360
------------
833,721
------------
Telecommunications -- 2.6%
Pacific Bell Corp.,
6.625%, due 10/15/34.................. 500,000 461,020
Southwestern Bell Telephone Corp.,
8.300%, due 06/01/96.................. 1,000,000 1,012,880
------------
1,473,900
------------
Utilities -- 2.8%
National Rural Utilities,
9.820%, due 01/21/99.................. 500,000 552,680
Orange & Rockland Utility Corp.,
6.500%, due 10/15/97.................. 500,000 503,305
Southern California Edison Corp.,
8.250%, due 02/01/00.................. 500,000 536,035
------------
1,592,020
------------
TOTAL CORPORATE BONDS
(Cost $14,794,016).................... 15,255,445
------------
YANKEE SECTOR -- 2.8%
Banking
ABN-AMRO Holdings,
7.250%, due 05/31/05.................. 500,000 519,020
International Bank for Reconstruction &
Development,
8.200%, due 03/15/11.................. 500,000 560,625
International Bank for Reconstruction &
Development,
9.350%, due 04/01/96.................. 500,000 506,715
------------
TOTAL YANKEE SECTOR
(Cost $1,543,508)..................... 1,586,360
------------
U.S. GOVERNMENT AND AGENCY
OBLIGATIONS -- 66.9%
U.S. Treasury Linked Custody
Receipts -- 0.8%
6.000%, due 08/15/09.................. 500,000 476,460
------------
</TABLE>
See notes to financial statements.
7
<PAGE> 26
VISTA BOND FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Issuer Amount Value
- --------------------------------------- ----------- ------------
<S> <C> <C>
U.S. Treasury Bonds -- 24.4%
7.125%, due 02/15/23.................. $ 1,050,000 $ 1,143,188
7.500%, due 11/15/16.................. 3,832,000 4,310,387
7.625%, due 11/15/22.................. 1,200,000 1,382,436
8.125%, due 05/15/21.................. 3,120,000 3,772,267
8.500%, due 02/15/20.................. 1,500,000 1,875,240
8.750%, due 08/15/20.................. 677,000 868,781
9.250%, due 02/15/16.................. 500,000 661,560
------------
14,013,859
------------
U.S. Treasury Notes -- 38.5%
4.750%, due 08/31/98.................. 600,000 585,186
5.125%, due 02/28/98.................. 500,000 494,140
5.125%, due 03/31/98.................. 1,500,000 1,481,490
5.250%, due 07/31/98.................. 600,000 593,250
5.500%, due 04/15/00.................. 500,000 494,920
5.750%, due 08/15/03.................. 1,000,000 986,410
6.000%, due 10/15/99.................. 250,000 252,070
6.250%, due 02/15/03.................. 1,000,000 1,017,660
6.375%, due 01/15/00.................. 2,000,000 2,041,240
6.375%, due 08/15/02.................. 1,080,000 1,107,842
6.375%, due 01/15/99.................. 1,300,000 1,324,583
6.500%, due 05/15/05.................. 400,000 414,000
6.750%, due 04/30/00.................. 954,000 988,583
6.875%, due 04/30/97.................. 700,000 712,684
7.125%, due 10/15/98.................. 530,000 550,204
7.250%, due 08/15/04.................. 915,000 990,771
7.250%, due 11/30/96.................. 1,000,000 1,016,560
7.625%, due 04/30/96.................. 480,000 484,723
7.625%, due 05/31/96.................. 335,000 338,769
7.875%, due 11/15/04.................. 1,000,000 1,127,030
7.875%, due 04/15/98.................. 362,000 379,930
8.000%, due 05/15/01.................. 425,000 467,763
8.250%, due 07/15/98.................. 147,000 156,257
8.500%, due 11/15/00.................. 550,000 613,420
8.500%, due 07/15/97.................. 1,450,000 1,516,830
8.750%, due 10/15/97.................. 1,300,000 1,373,931
8.875%, due 05/15/00.................. 500,000 561,095
------------
22,071,341
------------
<CAPTION>
Principal
Issuer Amount Value
- --------------------------------------- ----------- ------------
<S> <C> <C>
Federal National Mortgage Association
Bonds -- 3.2%
8.150%, due 05/11/98.................. $ 760,000 $ 800,850
9.200%, due 09/11/00.................. 900,000 1,019,106
------------
1,819,956
------------
TOTAL U.S. GOVERNMENT AND AGENCY
OBLIGATIONS
(Cost $36,169,792).................... 38,381,616
------------
COLLATERALIZED MORTGAGE
OBLIGATIONS -- 1.2%
Federal Home Loan Mortgage Corp., Ser.
1261, Class M,
8.000%, due 02/15/03................. 500,000 513,590
Federal National Mortgage Association,
Ser. 1993-39, Class E,
5.500%, due 11/25/97.................. 198,835 197,095
------------
TOTAL COLLATERALIZED MORTGAGE
OBLIGATIONS
(Cost $702,336)....................... 710,685
------------
TOTAL LONG-TERM INVESTMENTS
(Cost $53,209,652).................... 55,934,106
------------
SHORT-TERM INVESTMENTS -- 1.5%
COMMERCIAL PAPER --
Morgan Stanley Group,
5.920%, due 11/01/95
(Cost $827,000)...................... 827,000 827,000
------------
TOTAL INVESTMENTS --
(COST $54,036,652).................... 99.1% $ 56,761,106
============
</TABLE>
See notes to financial statements.
8
<PAGE> 27
VISTA SHORT-TERM BOND FUND
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Issuer Amount Value
- --------------------------------------- ----------- ------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 89.3%
CORPORATE BONDS AND NOTES -- 27.5%
Financial Services -- 21.3%
Associates Corp., N. A.,
>6.000%, due 12/01/95................. $ 1,000,000 $ 999,400
CNA Financial,
8.625%, due 03/01/96.................. 500,000 503,685
Dow Capital BV,
5.750%, due 09/15/97.................. 250,000 248,470
Dow Capital BV,
8.250%, due 02/15/96.................. 500,000 502,820
Ford Motor Credit Corp.,
9.850%, due 02/27/96.................. 1,000,000 1,011,430
General Motors Acceptance Corp.,
7.750%, due 12/10/96.................. 200,000 203,698
Household Finance Corp.,
7.500%, due 03/15/97.................. 500,000 510,160
Lehman Brothers Holdings,
5.890%, due 01/12/99.................. 1,000,000 977,290
Merrill Lynch,
5.875%, due 12/01/95.................. 900,000 899,298
Morgan Stanley Group,
8.875%, due 04/01/96.................. 475,000 480,154
PACCAR Financial Corp.,
4.530%, due 10/21/96.................. 1,400,000 1,380,750
------------
7,717,155
------------
Food and Beverage Products -- 2.0%
PepsiCo, Inc.,
5.000%, due 02/24/97.................. 215,000 212,439
PepsiCo, Inc.,
7.875%, due 08/15/96.................. 500,000 506,930
------------
719,369
------------
Telecommunications -- 4.2%
Pacific Northwest Bell Telephone Corp.,
7.500%, due 12/01/96.................. 1,000,000 1,015,160
Southwestern Bell Telephone Corp.,
8.300%, due 06/01/96.................. 500,000 506,440
------------
1,521,600
------------
TOTAL CORPORATE BONDS
AND NOTES
(Cost $10,002,277).................... 9,958,124
------------
<CAPTION>
Principal
Issuer Amount Value
- --------------------------------------- ----------- ------------
<S> <C> <C>
U.S. GOVERNMENT AND AGENCY
OBLIGATIONS -- 61.8%
U.S. Treasury Notes -- 53.6%
4.375%, due 08/15/96.................. $ 2,000,000 $ 1,981,240
5.625%, due 10/31/97.................. 500,000 500,155
5.875%, due 05/31/96.................. 2,000,000 2,003,120
6.000%, due 11/30/97.................. 2,000,000 2,014,680
6.000%, due 12/31/97.................. 750,000 755,505
6.125%, due 05/31/97.................. 1,000,000 1,007,190
6.125%, due 05/15/98.................. 1,000,000 1,010,470
6.500%, due 08/15/97.................. 1,400,000 1,420,342
6.750%, due 05/31/97.................. 2,000,000 2,032,820
7.000%, due 09/30/96.................. 1,500,000 1,518,285
7.250%, due 02/15/98.................. 500,000 516,560
7.375%, due 11/15/97.................. 2,500,000 2,581,650
7.500%, due 01/31/97.................. 1,000,000 1,022,340
8.750%, due 10/15/97.................. 1,000,000 1,056,870
------------
19,421,227
------------
Agency Obligations -- 8.2%
Federal Home Loan Bank -- 2.7%
4.444%, due 10/22/96.................. 1,000,000 973,740
------------
Federal National Mortgage
Association -- 5.5%
("FNMA")
5.680%, due 10/07/96.................. 1,000,000 999,690
6.270%, due 04/03/96.................. 1,000,000 1,002,600
------------
2,002,290
------------
TOTAL U.S. GOVERNMENT AND AGENCY
OBLIGATIONS
(Cost $22,188,153)................... 22,397,257
------------
TOTAL LONG-TERM INVESTMENTS
(Cost $32,190,430)................... 32,355,381
------------
SHORT-TERM INVESTMENTS -- 8.9%
REPURCHASE AGREEMENT -- 8.9%
Morgan Stanley & Co., Inc., 5.85%, due
11/1/95, (Dated 10/31/95; Proceeds
$3,230,525, Secured by FNMA REMIC;
$223,444 at 5.70%, due 3/25/08; FNMA
REMIC, Interest Only, $88,398,000,
due 8/25/20; Market Value $3,339,400)
(Cost $3,230,000).................... 3,230,000 3,230,000
------------
TOTAL INVESTMENTS --
(COST $35,420,430)................... 98.2% $ 35,585,381
============
- ------
REMIC = Real Estate Mortgage Investment Conduit
</TABLE>
See notes to financial statements.
9
<PAGE> 28
VISTA MUTUAL FUNDS
STATEMENT OF ASSETS AND LIABILITIES October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista
Vista Vista Short-Term
Equity Fund Bond Fund Bond Fund
------------ ------------ ------------
<S> <C> <C> <C>
ASSETS:
Investment securities, at value (Note 1)............... $ 54,105,727 $ 56,761,106 $ 35,585,381
Cash................................................... -- 51,131 60
Receivables:
Interest............................................. -- 1,090,042 556,618
Dividends............................................ 80,241 -- --
Trust shares sold.................................... 102,781 2,616 197,584
Investments securities sold.......................... 1,269,841 -- --
Other assets........................................... 603 428 553
----------- ----------- -----------
Total assets....................................... 55,559,193 57,905,323 36,340,196
----------- ----------- -----------
LIABILITIES:
Payable for investment securities purchased............ -- 498,350 --
Payable for Trust shares redeemed...................... 20,212 24,877 --
Payable to custodian................................... 10,997 -- --
Dividends payable...................................... -- 11,334 9,779
Accrued liabilities: (Note 2)
Distribution fees.................................... 8,653 5,280 907
Sub-administration fees.............................. 2,399 2,431 1,512
Other................................................ 99,709 78,160 82,250
----------- ----------- -----------
Total liabilities.................................. 141,970 620,432 94,448
----------- ----------- -----------
NET ASSETS:
Paid in capital........................................ 37,490,294 54,263,503 36,437,682
Accumulated undistributed net investment income........ 154,831 6,900 41,697
Accumulated undistributed net realized gain (loss) on
investment transactions.............................. 6,886,647 290,034 (398,582)
Net unrealized appreciation of investments............. 10,885,451 2,724,454 164,951
----------- ----------- -----------
Net assets......................................... $ 55,417,223 $ 57,284,891 $ 36,245,748
=========== =========== ===========
Shares of beneficial interest outstanding (no par
value; unlimited number of shares authorized)........ 4,528,446 5,252,642 3,595,666
=========== =========== ===========
Net asset value, offering and redemption price per
share (net assets/shares outstanding)................ $12.24 $10.91 $10.08
=========== =========== ===========
Cost of Investments.................................... $ 43,220,276 $ 54,036,652 $ 35,420,430
=========== =========== ===========
</TABLE>
See notes to financial statements.
10
<PAGE> 29
VISTA MUTUAL FUNDS
STATEMENT OF OPERATIONS
For the year ended October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista
Vista Vista Short-Term
Equity Fund Bond Fund Bond Fund
------------ ----------- -----------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest................................................. $ 297,361 $ 3,724,412 $ 1,956,373
Dividends #.............................................. 1,406,083 -- --
------------ ----------- -----------
Total Investment income................................ 1,703,444 3,724,412 1,956,373
------------ ----------- -----------
EXPENSES:
Investment advisory fees................................. 250,452 162,618 85,353
Distribution fees........................................ 156,533 135,515 85,353
Administration fees...................................... 62,613 54,206 34,141
Sub-administration fees.................................. 31,306 27,103 17,071
Transfer agent fees...................................... 14,577 36,219 37,383
Professional fees........................................ 33,546 32,847 31,804
Registration fees........................................ 4,117 1,992 496
Trustees fees............................................ 3,444 2,970 1,874
Printing and postage..................................... 1,885 5,984 2,646
Amortization of organization expenses.................... 3,716 3,716 6,730
Other.................................................... 1,973 9,969 3,614
------------ ----------- -----------
Total expenses......................................... 564,162 473,139 306,465
Less fees waived (Note 2E)................................. 368,986 305,309 197,311
------------ ----------- -----------
Net expenses........................................... 195,176 167,830 109,154
------------ ----------- -----------
Net Investment Income............................. 1,508,268 3,556,582 1,847,219
------------ ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investment transactions...... 6,905,243 330,075 (1,467)
Change in net unrealized appreciation/depreciation of
investments............................................ 3,304,651 4,034,751 556,820
------------ ----------- -----------
Net realized and unrealized gain on investments.......... 10,209,894 4,364,826 555,353
------------ ----------- -----------
Net increase in net assets resulting from operations..... $ 11,718,162 $ 7,921,408 $ 2,402,572
========== ========= =========
</TABLE>
- ---------------
# Vista Equity Fund net of foreign withholding taxes of $4,709
See notes to financial statements.
11
<PAGE> 30
VISTA MUTUAL FUNDS
STATEMENT OF CHANGES IN NET ASSETS
For the periods indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista
Vista Vista Short-Term
Equity Fund Bond Fund Bond Fund
----------------------------- ---------------------------- ----------------------------
Year Ended October 31,
-------------------------------------------------------------------------------------------
1995 1994 1995 1994 1995 1994
------------- ------------- ------------ ------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE/DECREASE IN NET ASSETS FROM
OPERATIONS:
Net investment income............. $ 1,508,268 $ 2,175,765 $ 3,556,582 $ 3,504,591 $ 1,847,219 $ 2,524,214
Net realized gain (loss) on
investment
transactions.................... 6,905,243 12,775,523 330,075 84,110 (1,467) (397,115)
Change in net unrealized
appreciation/ depreciation...... 3,304,651 (11,988,645) 4,034,751 (6,109,431) 556,820 (956,439)
------------- ------------- ------------ ------------- ------------ -------------
Increase (decrease) in net
assets from operations........ 11,718,162 2,962,643 7,921,408 (2,520,730) 2,402,572 1,170,660
------------- ------------- ------------ ------------- ------------ -------------
NET EQUALIZATION (DEBITS) (Note
1E)................................. (67,743) (124,351) (10,848) (10,159) (7,716) (58,454)
------------- ------------- ------------ ------------- ------------ -------------
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS FROM: (Note 1F)
Net investment income............. (1,473,768) (2,052,866) (3,546,956) (3,490,779) (1,840,470) (2,466,073)
Net realized gain on investment
transactions.................... (12,783,335) (6,378,145) (122,330) (410,480) -- --
------------- ------------- ------------ ------------- ------------ -------------
(14,257,103) (8,431,011) (3,669,286) (3,901,259) (1,840,470) (2,466,073)
------------- ------------- ------------ ------------- ------------ -------------
TRANSACTIONS IN SHARES OF BENEFICIAL
INTEREST:
Proceeds from shares sold......... 8,812,141 11,328,106 4,296,852 6,123,163 7,865,450 18,409,637
Reinvestment of dividends and
distributions................... 13,164,314 7,712,901 3,498,583 3,749,454 1,730,468 2,268,043
Payment for shares redeemed....... (31,770,485) (66,264,975) (7,190,891) (12,156,168) (9,891,946) (54,029,085)
------------- ------------- ------------ ------------- ------------ -------------
Net increase (decrease) in net
assets from transactions in
shares of beneficial
interest..................... (9,794,030) (47,223,968) 604,544 (2,283,551) (296,028) (33,351,405)
------------- ------------- ------------ ------------- ------------ -------------
Total increase (decrease) in
net assets................... (12,400,714) (52,816,687) 4,845,818 (8,715,699) 258,358 (34,705,272)
NET ASSETS:
Beginning of year................... 67,817,937 120,634,624 52,439,073 61,154,772 35,987,390 70,692,662
------------- ------------- ------------ ------------- ------------ -------------
End of year......................... $ 55,417,223 $ 67,817,937 $ 57,284,891 $ 52,439,073 $ 36,245,748 $ 35,987,390
============= ============= ============ ============= ============ =============
</TABLE>
See notes to financial statements.
12
<PAGE> 31
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995
- --------------------------------------------------------------------------------
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES -- Mutual Fund Group (the
"Trust") is organized as a Massachusetts Business Trust, and is registered under
the Investment Company Act of 1940, as amended, (the "1940 Act") as an open-end
management investment company. Vista Equity Fund ("VEF"), Vista Bond Fund
("VBF"), and Vista Short-Term Bond Fund ("VSTBF"), collectively, the "Funds",
are three separate portfolios of the Trust. Financial data presented herein for
previous periods relate to the predecessor funds.
The following is a summary of significant accounting policies followed by
the Funds:
A. Valuation of investments -- Equity securities listed on a securities
exchange or reported on the NASDAQ National Market system are valued at the
last reported sale price on the principal exchange on the date of
valuation. Securities for which sale prices are not available and other
over-the-counter securities, are valued at last quoted bid price. Bonds and
other fixed income securities (other than short-term obligations),
including listed issues, are valued using matrix pricing systems provided
by a major dealer in bonds which take into account factors such as
institutional-size trading in similar groups of securities, yield, quality,
coupon rate, maturity, type of issue, trading characteristics and other
market data, without exclusive reliance upon quoted exchange or
over-the-counter prices. Short-term debt securities with 61 days or more to
maturity at time of purchase are valued, through the 61st day prior to
maturity, at market value based on quotations obtained from market makers
or other appropriate sources; thereafter, the value on the 61st day is
amortized on a straight-line basis over the remaining number of days to
maturity. Short-term investments with 60 days or less to maturity at time
of purchase are valued at amortized cost, which approximates market.
B. Repurchase agreements -- It is the Trust's policy that repurchase
agreements are fully collateralized by U.S. Treasury and Government agency
securities. All collateral is held by the Trust's custodian bank,
subcustodian, or a bank with which the custodian bank has entered into a
subcustodian agreement, or is segregated in the Federal Reserve Book Entry
System. In connection with transactions in repurchase agreements, if the
seller defaults and the value of the collateral declines, or if the seller
enters an insolvency proceeding, realization of the collateral by the Trust
may be delayed or limited.
C. Security transactions and investment income -- Investment transactions
are accounted for on the trade date (the date the order to buy or sell is
executed). Securities gains and losses are calculated on the identified
cost basis. Interest income is determined on the basis of coupon interest
accrued adjusted for amortization of premium and accretion of discount.
Dividend income is recorded on the ex-dividend date.
D. Federal income taxes -- Each Fund is treated as a separate taxable
entity for Federal income tax purposes. The Trust's policy is to comply
with the provisions of the Internal Revenue Code applicable to regulated
investment companies and to distribute to shareholders all of its
distributable net investment income, and net realized gain on investments
for which there are no capital loss carryovers available to reduce such
taxable gains. In addition, the Trust intends to make distributions as
required to avoid excise taxes. Accordingly, no provision for Federal
income or excise tax is necessary.
14
<PAGE> 32
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
share basis, to the amount of undistributed net investment income on the
date of the transactions, is credited or charged to undistributed net
investment income. As a result, undistributed net investment income per
share is unaffected by sales or redemptions of Trust shares.
F. Distributions to shareholders -- Dividends and distributions paid to
shareholders are recorded on the ex-dividend date. The amount of dividends
and distributions from net investment income and net realized capital gains
is determined in accordance with federal income tax regulations, which may
differ from generally accepted accounting principles. To the extent these
"book/tax" differences are permanent in nature, (i.e., that they result
from other than timing of recognition -- "temporary differences") such
amounts are reclassified within the capital accounts based on their federal
tax-basis treatment.
The reclassifications for the Funds are as follows: VEF paid in capital was
decreased by $67,743, accumulated undistributed net investment income and
accumulated undistributed net realized gain (loss) were increased by
$65,175 and $2,568, respectively; VBF paid in capital was decreased and
accumulated undistributed net investment income was increased by $10,848;
VSTBF paid in capital was decreased and accumulated undistributed net
investment income was increased by $7,716. The adjustments for the Funds
relate primarily to the character for tax purposes of equalization and
certain short-term gains or losses.
G. Expenses -- Expenses directly attributable to a Fund are charged to
that Fund; other expenses of the Trust are allocated proportionately among
each of the Funds within the Trust in relation to the net assets of each
Fund or on another reasonable basis.
H. Organization Costs -- Organization and registration costs incurred in
connection with establishing the Funds are being amortized on a
straight-line basis over a sixty month period beginning at the commencement
of operations of each Fund.
2. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A. Investment advisory fee -- Pursuant to separate Investment Advisory
Agreements, The Chase Manhattan Bank, N.A. ("Chase" or the "Adviser") acts
as the investment adviser to the Funds. Chase is a direct wholly-owned
subsidiary of The Chase Manhattan Corporation. As investment adviser, Chase
supervises the investments of the Funds and for such services is paid a
fee. The fee is computed daily and paid monthly at an annual rate equal to
0.40%, 0.30% and 0.25% of the average daily net assets for VEF, VBF, and
VSTBF, respectively. For the year ended October 31, 1995, the Adviser
voluntarily waived all of its fees as outlined in Note 2. E. below.
B. Shareholder servicing fees -- The Trust has adopted an Administrative
Services Plan which, among other things, provides that the Trust on behalf
of the Funds may obtain the services of one or more Shareholder Servicing
Agents. There is no present intention that the Shareholder Servicing Agents
will charge fees for their services rendered to the Funds in their capacity
as shareholder servicing agent. Such fees may be charged in the future.
C. Distribution and Sub-administration fees -- Pursuant to a Distribution
and Sub-administration Agreement, Vista Broker-Dealer Services, Inc.
("VBDS" or the "Distributor"), a wholly-owned subsidiary of Concord Holding
Corp., a wholly owned subsidiary of The BISYS Group, Inc., acts as
14
<PAGE> 33
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
the Trust's exclusive underwriter and promotes and arranges for the sale of
each Fund's shares. In addition, the Distributor provides certain
sub-administration services to the Trust, including providing officers,
clerical staff and office space for an annual fee of 0.05% of the average
daily net assets of each Fund.
The Trustees have approved an amended and restated plan of distribution for
the Vista class of shares (the "Vista Plan") of each Fund. Pursuant to the
Vista Plan, the Vista Funds may pay the Distributor a distribution fee not
to exceed the annual rate of 0.20% of the respective Fund's average daily
net assets for its services in connection with the distribution of Fund
shares. The Trust is also permitted to pay the Distributor an additional
amount not to exceed 0.05% of the respective Fund's average daily net
assets in anticipation of, or as reimbursement for, advertising expenses
incurred in connection with the sale of shares of the Funds. The
Distributor voluntarily waived a portion of distribution fees as outlined
in Note 2. E. below.
D. Administration fee -- Pursuant to an Administration Agreement, Chase
(the "Administrator") provides certain administration services to the
Trust. For these services and facilities, the Administrator receives from
each Fund a fee computed at the annual rate equal to 0.10% of the
respective Fund's average daily net assets. The Administrator voluntarily
waived all administration fees as outlined in Note 2. E. below.
E. Waivers of fees -- For the year ended October 31, 1995, the Adviser,
Administrator and Distributor voluntarily waived fees for each of the Funds
as follows:
<TABLE>
<CAPTION>
Fee VEF VBF VSTBF
-------------------------------------------- --------- --------- ---------
<S> <C> <C> <C>
Investment Advisory......................... $250,452.. $ 162,618 $ 85,353
Administration.............................. 62,613... 54,206 34,141
Distribution................................ 55,921... 88,485 77,817
--------- --------- ---------
$ 368,986 $ 305,309 $ 197,311
========= ========= =========
</TABLE>
F. Other -- Certain officers of the Trust are officers of VBDS or of its
parent corporation, BISYS.
Chase provides portfolio accounting and custody services for the Funds.
On August 27, 1995, the Chase Manhattan Corporation and Chemical Banking
Corporation announced an agreement in principle to merge, which was
approved by shareholders of both corporations on December 11, 1995, subject
to the approval of regulators.
3. INVESTMENT TRANSACTIONS -- For the year ended October 31, 1995, purchases
and sales of investments (excluding short-term investments) were as follows:
<TABLE>
<CAPTION>
VEF VBF VSTBF
------------ ------------ ------------
<S> <C> <C> <C>
Purchases (excluding U.S. Government)..... $ 26,022,012 $ 5,571,562 $ 5,173,668
Sales (excluding U.S. Government)......... 41,004,146 2,322,127 11,659,474
Purchases of U.S. Government.............. -- 11,761,880 12,884,106
Sales of U.S. Government.................. -- 13,133,089 7,172,175
</TABLE>
15
<PAGE> 34
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
4. FEDERAL INCOME TAX MATTERS -- For Federal income tax purposes, the cost and
unrealized appreciation (depreciation) in value of the investment securities at
October 31, 1995 are as follows:
<TABLE>
<CAPTION>
VEF VBF VSTBF
------------ ------------ ------------
<S> <C> <C> <C>
Aggregate cost........................... $ 43,220,276 $ 54,036,652 $ 35,420,430
============ ============ ============
Gross unrealized appreciation............ $ 11,601,464 $ 2,858,492 $ 267,905
Gross unrealized depreciation............ (716,013) (134,038) (102,954)
------------ ------------ ------------
Net unrealized appreciation.............. $ 10,885,451 $ 2,724,454 $ 164,951
============ ============ ============
</TABLE>
At October 31, 1995 the VSTBF had a net capital loss carryover of approximately
$398,600. Such losses will be available to offset capital gains of $397,100 and
$1,500 arising through October 31, 2002 and 2003, respectively. To the extent
that any net capital loss carryover is used to offset future capital gains, it
is probable that the gains so offset will not be distributed to shareholders.
5. TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST -- Transactions in Shares of
Beneficial Interest were as follows:
<TABLE>
<CAPTION>
Vista Vista Vista
Equity Bond Short-Term
Fund Fund Bond Fund
--------------------------- ------------------------- -------------------------
Year Ended
---------------------------------------------------------------------------------------
10/31/95 10/31/94 10/31/95 10/31/94 10/31/95 10/31/94
----------- ----------- --------- ----------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Shares sold................... 760,959 870,887 414,161 572,947 786,229 1,833,063
Shares issued in reinvestment
of distributions............ 1,297,064 596,270 334,782 353,877 173,094 226,469
Shares redeemed............... (2,684,018) (5,153,295) (698,335) (1,135,854) (994,500) (5,399,266)
----------- ----------- --------- ----------- --------- -----------
Net increase (decrease) in
shares of beneficial
interest outstanding........ (625,995) (3,686,138) 50,608 (209,030) (35,177) (3,339,734)
Outstanding shares at:
Beginning of period......... 5,154,441 8,840,579 5,202,034 5,411,064 3,630,843 6,970,577
----------- ----------- --------- ----------- --------- -----------
End of period............... 4,528,446 5,154,441 5,252,642 5,202,034 3,595,666 3,630,843
=========== =========== ========= =========== ========= ===========
</TABLE>
6. RETIREMENT PLAN -- During the year ended October 31, 1995, the Trust
adopted an unfunded noncontributory defined benefit pension plan covering all
independent directors of the Trust who have served as an independent director of
the Trust, or other Vista Funds, for at least five years at the time of
retirement. Benefits under this plan are based on compensation and years of
service. Management has determined that the accrual for prior service costs is
not material.
16
<PAGE> 35
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OF BENEFICIAL INTEREST
OUTSTANDING
Throughout each period indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista Equity Fund
--------------------------------------------------------------
Year Ended 7/1/92** Year
----------------------------------- through Ended
10/31/95 10/31/94 10/31/93 10/31/92 6/30/92
-------- -------- --------- --------- --------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net asset value, beginning of period............................. $ 13.16 $ 13.65 $ 12.56 $ 12.50 $ 11.43
-------- -------- --------- --------- --------
Income from Investment Operations:
Net investment income......................................... 0.277 0.298 0.302 0.080 0.240
Net gains (losses) on securities (both realized and
unrealized)................................................. 1.744 0.263 1.153 0.500 1.230
-------- -------- --------- --------- --------
Total from Investment Operations.............................. 2.021 0.561 1.455 0.580 1.470
-------- -------- --------- --------- --------
Less Distributions:
Dividends from net investment income.......................... 0.282 0.290 0.304 0.140 0.290
Distributions from capital gains.............................. 2.659 0.761 0.062 0.380 0.110
-------- -------- --------- --------- --------
Total Distributions........................................... 2.941 1.051 0.366 0.520 0.400
-------- -------- --------- --------- --------
Net Asset Value, End of Period................................... $ 12.24 $ 13.16 $ 13.65 $ 12.56 $ 12.50
======== ======== ========= ========= ========
Total Return..................................................... 20.41% 4.37% 11.73% 4.78% 12.99%
======== ======== ========= ========= ========
Ratios/Supplemental Data
Net Assets, End of Period (000 omitted)......................... $ 55,417 $ 67,818 $ 120,635 $ 106,088 $ 92,261
Ratio of expenses to average net assets #....................... 0.31% 0.31% 0.31% 0.30% 0.30%
Ratio of net investment income to average net assets #.......... 2.41% 2.30% 2.30% 1.96% 2.29%
Ratio of expenses without waivers and assumption of expenses to
average net assets #.......................................... 0.90% 0.95% 0.88% 0.80% 1.02%
Ratio of net investment income without waivers and assumption of
expenses to average net assets #.............................. 1.82% 1.66% 1.73% 1.46% 1.57%
Portfolio turnover rate.......................................... 45% 53% 33% 5% 14%
<CAPTION>
Vista Equity
Fund
------------
11/30/90*
through
6/30/91
--------
<S> <<C>
Per Share Operating Performance
Net asset value, beginning of period............................. $ 10.00
--------
Income from Investment Operations:
Net investment income......................................... 0.170
Net gains (losses) on securities (both realized and
unrealized)................................................. 1.350
--------
Total from Investment Operations.............................. 1.520
--------
Less Distributions:
Dividends from net investment income.......................... 0.090
Distributions from capital gains.............................. --
--------
Total Distributions........................................... 0.090
--------
Net Asset Value, End of Period................................... $ 11.43
========
Total Return..................................................... 15.25%
========
Ratios/Supplemental Data
Net Assets, End of Period (000 omitted)......................... $ 95,440
Ratio of expenses to average net assets #....................... 0.28%
Ratio of net investment income to average net assets #.......... 2.81%
Ratio of expenses without waivers and assumption of expenses to
average net assets #.......................................... 1.13%
Ratio of net investment income without waivers and assumption of
expenses to average net assets #.............................. 1.96%
Portfolio turnover rate.......................................... 19%
</TABLE>
<TABLE>
<CAPTION>
Vista Bond Fund
------------------------------------------------------------
Year Ended 7/1/92** Year
---------------------------------- through Ended
10/31/95 10/31/94 10/31/93 10/31/92 6/30/92
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net asset value, beginning of period............................. $ 10.08 $ 11.30 $ 10.76 $ 10.70 $ 10.14
-------- -------- -------- -------- --------
Income from Investment Operations:
Net investment income......................................... 0.687 0.667 0.622 0.240 0.760
Net gains (losses) on securities (both realized and
unrealized)................................................. 0.854 (1.140) 0.629 0.110 0.570
-------- -------- -------- -------- --------
Total from investment operations.............................. 1.541 (0.473) 1.251 0.350 1.330
-------- -------- -------- -------- --------
Less Distributions:
Dividends from net investment income.......................... 0.687 0.667 0.684 0.240 0.760
Distributions from capital gains.............................. 0.024 0.081 0.026 0.050 0.010
-------- -------- -------- -------- --------
Total Distributions........................................... 0.711 0.748 0.710 0.290 0.770
-------- -------- -------- -------- --------
Net Asset Value, End of Period................................... $ 10.91 $ 10.08 $ 11.30 $ 10.76 $ 10.70
======== ======== ======== ======== ========
Total Return..................................................... 15.83% (4.30%) 12.63% 3.36% 13.67%
======== ======== ======== ======== ========
Ratios/Supplemental Data
Net Assets, End of Period (000 omitted)......................... $ 57,285 $ 52,439 $ 61,155 $ 45,401 $ 41,321
Ratio of expenses to average net assets #....................... 0.31% 0.31% 0.31% 0.30% 0.30%
Ratio of net investment income to average net assets #.......... 6.56% 6.27% 6.15% 6.74% 7.20%
Ratio of expenses without waivers and assumption of expenses to
average net assets #.......................................... 0.87% 0.92% 0.82% 0.73% 1.03%
Ratio of net investment income without waivers and assumption of
expenses to average net assets #.............................. 6.00% 5.66% 5.64% 6.31% 6.47%
Portfolio turnover rate.......................................... 30% 17% 20% 3% 31%
<CAPTION>
Vista Equity
Fund
------------
11/30/90*
through
6/30/91
--------
<S> <<C>
Per Share Operating Performance
Net asset value, beginning of period............................. $ 10.00
--------
Income from Investment Operations:
Net investment income......................................... 0.410
Net gains (losses) on securities (both realized and
unrealized)................................................. 0.080
--------
Total from investment operations.............................. 0.490
--------
Less Distributions:
Dividends from net investment income.......................... 0.350
Distributions from capital gains.............................. --
--------
Total Distributions........................................... 0.350
--------
Net Asset Value, End of Period................................... $ 10.14
========
Total Return..................................................... 4.82%
========
Ratios/Supplemental Data
Net Assets, End of Period (000 omitted)......................... $ 36,791
Ratio of expenses to average net assets #....................... 0.29%
Ratio of net investment income to average net assets #.......... 7.30%
Ratio of expenses without waivers and assumption of expenses to
average net assets #.......................................... 1.04%
Ratio of net investment income without waivers and assumption of
expenses to average net assets #.............................. 6.55%
Portfolio turnover rate.......................................... 35%
</TABLE>
- ---------------
* Commencement of operations.
# Short periods have been annualized.
** In 1992, the Fund's fiscal year-end was changed from June 30 to October 31.
See notes to financial statements.
17
<PAGE> 36
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OF BENEFICIAL INTEREST
OUTSTANDING
Throughout each period indicated (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista Short-Term Bond Fund
------------------------------------------------------------
Year Ended 7/1/92** Year
---------------------------------- through Ended
10/31/95 10/31/94 10/31/93 10/31/92 6/30/92
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net asset value, beginning of period............................. $ 9.91 $ 10.14 $ 10.26 $ 10.28 $ 10.13
-------- -------- -------- -------- --------
Income from Investment Operations:
Net investment income......................................... 0.542 0.465 0.489 0.190 0.600
Net gains (losses) on securities (both realized and
unrealized)................................................. 0.168 (0.230) (0.073) (0.010) 0.190
-------- -------- -------- -------- --------
Total from investment operations.............................. 0.710 0.235 0.416 0.180 0.790
-------- -------- -------- -------- --------
Less Distributions:
Dividends from net investment income.......................... 0.542 0.465 0.536 0.200 0.630
Distributions from capital gains.............................. -- -- -- -- 0.010
-------- -------- -------- -------- --------
Total Distributions........................................... 0.542 0.465 0.536 0.200 0.640
-------- -------- -------- -------- --------
Net Asset Value, End of Period................................... $ 10.08 $ 9.91 $ 10.14 $ 10.26 $ 10.28
======== ======== ======== ======== ========
Total Return.................................................. 7.37% 2.38% 4.73% 1.67% 8.07%
======== ======== ======== ======== ========
Ratios/Supplemental Data
Net Assets, End of Period (000 omitted)......................... $ 36,246 $ 35,987 $ 70,693 $ 81,327 $ 70,960
Ratio of expenses to average net assets #....................... 0.32% 0.31% 0.31% 0.30% 0.30%
Ratio of net investment income to average net assets #.......... 5.41% 4.59% 5.25% 5.66% 6.12%
Ratio of expenses without waivers and assumption of expenses to
average net assets #.......................................... 0.90% 0.86% 0.76% 0.66% 0.94%
Ratio of net investment income without waivers and assumption of
expenses to average net assets #.............................. 4.83% 4.05% 4.80% 5.30% 5.48%
Portfolio turnover rate.......................................... 62% 44% 17% 0% 29%
<CAPTION>
Vista Short-Term
Bond Fund
----------------
11/30/90*
through
6/30/91
--------
<S> <<C>
Per Share Operating Performance
Net asset value, beginning of period............................. $ 10.00
--------
Income from Investment Operations:
Net investment income......................................... 0.370
Net gains (losses) on securities (both realized and
unrealized)................................................. 0.070
--------
Total from investment operations.............................. 0.440
--------
Less Distributions:
Dividends from net investment income.......................... 0.310
Distributions from capital gains.............................. --
--------
Total Distributions........................................... 0.310
--------
Net Asset Value, End of Period................................... $ 10.13
========
Total Return.................................................. 4.39%
========
Ratios/Supplemental Data
Net Assets, End of Period (000 omitted)......................... $ 70,745
Ratio of expenses to average net assets #....................... 0.29%
Ratio of net investment income to average net assets #.......... 6.56%
Ratio of expenses without waivers and assumption of expenses to
average net assets #.......................................... 0.99%
Ratio of net investment income without waivers and assumption of
expenses to average net assets #.............................. 5.86%
Portfolio turnover rate.......................................... 1%
</TABLE>
- ---------------
* Commencement of operations.
# Short periods have been annualized.
** In 1992, the Fund's fiscal year-end was changed from June 30 to October 31.
See notes to financial statements.
18
<PAGE> 37
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE TRUSTEES
AND SHAREHOLDERS OF
MUTUAL FUND GROUP
In our opinion, the accompanying statement of assets and liabilities, including
the portfolios of investments, and the related statements of operations and of
changes in net assets and the selected per share data and ratios for a share of
beneficial interest outstanding present fairly, in all material respects, the
financial position of Vista Equity Fund, Vista Bond Fund and Vista Short-Term
Bond Fund (the "Funds"), separate portfolios of Mutual Fund Group (hereafter
referred to as the "Trust"), at October 31, 1995, the results of each of their
operations for the year then ended, the changes in each of their net assets for
each of the two years in the period then ended and the selected per share data
and ratios for a share of beneficial interest outstanding for each of the three
years in the period then ended and the period July 1, 1992 through October 31,
1992, in conformity with generally accepted accounting principles. These
financial statements and selected per share data and ratios for a share of
beneficial interest outstanding (hereafter referred to as "financial
statements") are the responsibility of the Trust's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at October
31, 1995 by correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above. The financial statements of the Funds for
the year ended June 30, 1992 and the period from November 30, 1990 (commencement
of operations) through June 30, 1991 were audited by other independent
accountants whose report dated July 31, 1992 expressed an unqualified opinion on
those financial statements.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York 10036
December 11, 1995
<PAGE> 38
UNAUDITED
VISTA EQUITY FUND
VISTA BOND FUND
VISTA SHORT-TERM BOND FUND
- --------------------------------------------------------------------------------
Certain tax information regarding the Vista Mutual Funds is required to be
provided to shareholders based upon the Funds income and distributions for the
taxable year ended October 31, 1995. The information and distributions reported
in this letter may differ from the information and distributions taxable to the
shareholders for the calendar year ending December 31, 1995. The information
necessary to complete your income tax returns for the calendar year ending
December 31, 1995 will be received under separate cover.
FOR THE FISCAL YEAR ENDED OCTOBER 31, 1995.
The following represents the source and percentage of income earned from
government obligations by the Funds:
<TABLE>
<CAPTION>
Federal Federal
Federal Home Loan National
U.S. Treasury Home Loan Mortgage Mortgage
Obligations Bank Assoc. Assoc.
------------- --------- --------- --------
<S> <C> <C> <C> <C>
Equity Fund....................... -- -- -- --
Bond Fund......................... 65.12%* 0.80% 1.07% 4.12%
Short-Term Bond Fund.............. 46.39% -- 8.13% 2.34%
</TABLE>
- ---------------
* Includes 1.18% income earned from U.S. Treasury Linked custody receipts.
For corporations, dividends eligible for the dividends received deduction for
the Equity Fund was 82.12%.
Listed below are the long-term capital gain distributions paid per share for the
fiscal-year ended October 31, 1995:
<TABLE>
<S> <C>
Equity Fund.............................................................. $2.659
Bond Fund................................................................ $0.024
Short-term Bond Fund..................................................... --
</TABLE>
<PAGE> 39
(This page intentionally left blank.)
<PAGE> 40
(This page intentionally left blank.)
<PAGE> 41
VISTA FAMILY OF MUTUAL FUNDS
MANAGED BY CHASE MANHATTAN
Vista offers a wide variety of professionally managed mutual funds that can
help you meet your financial goals. For a brochure and prospectus containing
more complete information on sales charges or expenses, contact your
investment representative or call 1-800-34-VISTA. Please read the prospectus
carefully before you invest or send money:
<TABLE>
<S> <C>
VISTA EQUITY FUNDS VISTA FIXED INCOME FUNDS
Growth and Income Fund U.S. Government Income Fund(2)
Capital Growth Fund Tax Free Income Fund
Small Cap Equity Fund New York Tax Free Income Fund
Equity Income Fund California Intermediate Tax Free Fund
Growth Fund of Washington(1) Bond Fund
Equity Fund Short-Term Bond Fund
VISTA BALANCED FUND VISTA MONEY MARKET FUNDS(2)
Balanced Fund U.S. Government Money Market Fund
Treasury Plus Money Market Fund
VISTA INTERNATIONAL FUNDS Tax Free Money Market Fund
Global Fixed Income Fund New York Tax Free Money Market Fund
International Equity Fund California Tax Free Money Market Fund
European Fund Global Money Market Fund
Japan Fund Federal Money Market Fund
Southeast Asian Fund Prime Money Market Fund
Select Shares of Connecticut Daily Tax Free
Income Fund(3)
Select Shares of New Jersey Daily Municipal
Income Fund(3)
</TABLE>
Vista Broker-Dealer Services, Inc. is the funds' distributor and is
unaffiliated with Chase. The Chase Manhattan Bank, N.A. is the funds'
portfolio adviser and provides other services to the funds.
(1) Washington Investment Advisors, Inc. is the fund's investment adviser.
(2) An investment in these funds is neither insured nor guaranteed by the U.S.
government, and there can be no assurance that these funds will be able to
maintain a stable Net Asset Value of $1.00 per share.
(3) Vista Select Shares of Connecticut Daily Tax Free Income Fund, Inc., and
Vista Select Shares of New Jersey Daily Municipal Income Fund, Inc., are
not part of, or affiliated with, the Vista Family of Mutual Funds. Reich &
Tang Distributors L.P. and New England Investment Companies L.P., which
are unaffiliated with Chase, are the funds' distributor and investment
adviser, respectively. National bank subsidiaries of The Chase Manhattan
Corporation do, however, perform shareholder servicing agent services for
the funds, although they perform no other services for the funds, such as
serving as investment adviser, custodian or administrator.
INVESTMENTS IN MUTUAL FUNDS ARE SUBJECT TO RISK, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL. IN ADDITION, THEY ARE NOT DEPOSITS, OBLIGATIONS OF, ENDORSED OR
GUARANTEED BY CHASE AND ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD
OR ANY OTHER GOVERNMENT AGENCY.
<PAGE> 42
[VISTA LOGO]
-------------------------
ANNUAL
-------------------------
REPORT
VISTA SERVICE CENTER
P.O. BOX 419392
KANSAS CITY, MO 64179
INVESTMENT ADVISER,
ADMINISTRATOR,
SHAREHOLDER SERVICING AGENT
AND CUSTODIAN
The Chase Manhattan Bank, N.A.
DISTRIBUTOR
Vista Broker-Dealer Services,
Inc.
TRANSFER AGENT
DST Systems, Inc.
LEGAL COUNSEL
Kramer, Levin, Naftalis, Nessen,
Kamin & Frankel
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP Vista
Broker-Dealer Services, Inc. is
the funds' distributor and is
unaffiliated with Chase. The
Chase Manhattan Bank, N.A. is
the funds' adviser.
This report is submitted for the
general information of the
shareholders of the funds. It is
not authorized for distribution
to prospective investors in the
funds unless preceded or
accompanied by a prospectus. To
obtain a prospectus for any of
the Vista funds, call
1-800-34-VISTA. The prospectus
contains more complete
information, including charges
and expenses. Please read it
carefully before you invest or
send money.
For more information
about these funds or your
account, simply call your
investment representative or the
Vista Service Center at
1-800-34-VISTA.
VEBS-2
VISTA
EQUITY
FUND
VISTA
BOND
FUND
VISTA
SHORT-TERM
BOND FUND
FOR THE 12 MONTHS ENDED
OCTOBER 31, 1995
<PAGE> 43
-----------------------------------------------------------------
VISTA(SM) FAMILY OF MUTUAL FUNDS CHAIRMAN'S LETTER
December 29, 1995
Dear Shareholder:
We are pleased to present this Annual Report for
the Growth and Income Fund, Capital Growth Fund and
International Equity Fund for the fiscal year ended
October 31, 1995.
U.S. MARKETS ROAR TO LIFE IN 1995
The U.S. financial markets roared to life in
1995 as investors correctly anticipated that the
economy would undergo a "soft landing" on the heels
of the Fed's rate hikes in 1994. All in all, it was
an outstanding year for U.S. equity investors -- one
of the best of the past century. Bond investors also
fared well, with the yield on 30-year Treasury bonds
dropping from 7.96% to 6.32% over the 12-month
period, sending the value of bonds soaring.
MIXED PERFORMANCE RESULTS IN OVERSEAS MARKETS
The financial markets overseas provided a very
mixed bag of results. With most developed economies
showing restrained growth and with inflation
basically under control, bonds rallied on
expectations that rates would be lowered to
stimulate the economy. European equities rose as the
economy began to show signs of sustained growth and
corporations reported solid earnings growth. In
Japan, the stock market declined as corporations
struggled with weak consumer demand and increased
competition, which helped squeeze product prices and
profit margins. The developing markets of Southeast
Asia and Latin America also suffered as investors
retreated following the devaluation of the Mexican
peso.
STRONG STOCK AND BOND SELECTIONS BOOST INVESTMENT
RETURNS
The Vista funds performed well during the period
under review -- a result of both the positive
economic environment for many of the financial
markets and timely stock and bond selection
decisions by the fund managers. Given the sizeable
gains in the U.S. stock and bond markets during the
past year, Vista fund managers are cautiously
optimistic about these markets in the months ahead.
As always, we recommend that investors take a
long-term, disciplined approach to the markets. By
leaving your money invested for the long
term -- five years or more -- you are better able to
ride out bumpy periods.
We appreciate your confidence in Vista. If you
have any questions about your Fund, or the
information included in this report, please call us
at 1-800-34-VISTA.
We look forward to hearing from you.
Sincerely,
/s/ FERGUS REID
-----------------
Fergus Reid
Chairman
INVESTMENTS IN MUTUAL FUNDS ARE SUBJECT TO RISK,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. IN
ADDITION, THEY ARE NOT DEPOSITS, OBLIGATIONS OF,
ENDORSED OR GUARANTEED BY CHASE, AND ARE NOT INSURED
BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENT AGENCY.
- ------------------------------
CONTENTS
CHAIRMAN'S LETTER 1
FUND COMMENTARY 2-4
FUND FINANCIAL
STATEMENTS 5-15
PORTFOLIO FINANCIAL
STATEMENTS 17-33
1
<PAGE> 44
---------------------------------------------------------------
FUND COMMENTARY
VISTA GROWTH AND INCOME FUND
During the past 12 months, your Fund benefited from a
positive economic environment for the U.S. stock market. For
the fiscal year ended October 31, 1995, the Fund had a total
return of 17.79% (A shares, without sales charge).
In late 1994, the U.S. stock market was at a crossroad
as economic signals were mixed. That is, some sectors were
showing solid growth while others were slowing as a result
of recent rate hikes by the Federal Reserve. By the end of
the first quarter, however, stocks had climbed into the
record books as conditions for the stock market improved:
inflation was under control, the dollar firmed and first
quarter earnings were better-than-expected.
The market continued its ascent to new highs in the
second and third quarters of 1995, sparked by continued
declines in interest rates and as the threat of inflation
dissipated. Strong economic reports dampened fears that the
economy was entering a recession and helped bolster the
market's performance. The market was further helped as the
dollar stabilized against major foreign currencies.
After equities posted solid gains for the first nine
months of the fiscal period, cyclical issues began to turn
lower in July on tions of a weakening economy while the
defensive sector gained. The fiscal period ended on a
negative note for equities on weaker-than-expected
third-quarter earnings results in the cyclical area and
continued mixed economic data.
For the period under review, the Fund benefited from
its significant investments in basic industry, capital goods
and financial companies, which performed well.
Going forward, we see the most promise in the basic
industry, capital goods, technology, transportation and
financial sectors; we also like some consumer staples and
health care issues. We expect technology stocks to remain
volatile as investors with large weightings and solid gains
take some profits and those who missed the rally begin
buying on downturns. We plan to continue to maintain a 10%
cash position. This will give us the opportunity to take
advantage of attractive investment opportunities in the
months ahead.
<TABLE>
<CAPTION>
---------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
WITHOUT
SALES WITH SALES
CLASS A SHARES CHARGE CHARGE
<S> <C> <C>
One Year 17.79% 12.19%
Five Years 21.01% 19.84%
Since Inception (9/23/87) 22.99% 22.25%
<CAPTION>
<S> <C> <C>
CLASS B SHARES WITHOUT CDSC WITH CDSC*
One Year 17.21% 12.21%
Since Inception (11/5/93) 9.15% 7.29%
</TABLE>
*Assumes a 5% CDSC for the one-year period and a 4%
CDSC for the period since inception.
---------------------------------------------------
<TABLE>
<CAPTION>
---------------------------------------------
GROWTH OF $10,000
[GRAPH]
Vista Growth and Lipper Growth and
Income Fund Income Fund Index
<S> <C> <C>
09/30/87 9525 10000.00
9525 8004.99
9525 7517.40
9525 8013.91
9525 8400.09
9525 8792.43
10212.705 8637.17
10785.380046728972 8741.52
11300.7875887850467 8805.69
12757.2911242990654 9206.89
13572.6067224685546 9178.44
13428.7274992621741 8962.06
13598.504982645703 9283.02
13608.1698760235607 9460.63
12854.3081925506646 9342.97
12/31/88 13342.3853081324755 9486.09
14153.2485036543387 10056.80
13953.1653774866062 9933.92
14549.2024796494303 10133.05
15810.204005562236 10545.10
17071.2055314750417 10905.71
17131.6064449011172 10872.69
18070.909477394138 11603.59
19159.6470832383211 11854.63
19573.7943293829712 11778.97
19649.7037810758691 11433.08
20322.044638927251 11582.88
12/31/89 20927.1514109934946 11740.90
20729.7254542860088 11073.59
20961.9912857065804 11234.13
21634.4008676691349 11437.78
21470.415154541161 11115.18
23438.2437120768484 11947.02
23567.0896295345422 11867.02
22811.8098417076966 11788.54
21254.0452793148275 10829.01
20350.0697832595717 10271.91
19658.6204291710801 10111.08
20314.3051614963738 10708.54
12/31/90 20961.6448154102548 11036.54
23440.1756046358285 11606.72
25931.1613224504756 12367.94
28084.6184755012379 12611.36
27922.2074255984283 12666.79
30345.8800164557415 13172.04
28596.8379405793299 12566.37
30398.2135588835397 13087.87
31624.1497435627935 13392.52
31012.4326065136556 13293.22
31965.5037258403996 13500.92
30247.4676291592953 12919.18
12/31/91 33343.6947260247307 14084.47
34908.5612655132559 14068.87
36379.8033111862284 14331.47
35327.1965021456563 14069.58
35246.7550679851728 14328.13
35273.5688793720006 14477.41
34222.46747300835 14236.51
35541.304206140406 14701.11
34720.3956273541262 14443.15
35019.152519961592 14638.88
35910.1564005774227 14703.28
37584.1636914314079 15201.61
12/31/92 38380.6671604667718 15440.98
39017.3460964139306 15680.64
39529.4574144583845 15913.50
40570.2890662676529 16355.05
40375.973620859597 16152.75
41694.5427146999758 16462.04
41911.065639583238 16565.10
41604.8406498552967 16654.20
42857.5792441968747 17280.16
42996.7724213459389 17301.28
43262.0122512178781 17569.51
42619.8526631068674 17287.56
12/31/93 43368.1081831666538 17698.50
44698.15783054599 18305.69
43891.6383635180947 17841.14
42205.0222149264258 17125.49
42119.8742212177646 17357.47
42432.0835314828558 17563.05
41620.3393247936186 17214.58
42404.0156900328 17685.75
43800.3844862771597 18357.82
42895.5945009555593 17925.71
43325.1231508316163 18124.55
41778.8200112778111 17454.42
12/31/94 41887.6339359130789 17578.12
42262.0163636661693 17853.45
43946.7372885550762 18521.82
45173.5597056536648 18956.98
45882.7889352522004 19479.65
47431.5139876408394 20133.53
48640.0984911403847 20513.14
50806.7276914931253 21201.69
51112.0915385227062 21403.87
52025.2748524968814 22041.33
10/31/95 51032.64895744363 21742.07
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT
RETURN AND PRINCIPAL VALUE WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES
ARE REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN
CLASS A SHARES OF THE VISTA GROWTH AND INCOME FUND AND THE LIPPER GROWTH AND
INCOME FUND INDEX FROM SEPTEMBER 30, 1987 TO OCTOBER 31, 1995. THE FUND'S
PERFORMANCE INCLUDES A 4.75% SALES CHARGE AND ASSUMES THE REINVESTMENT OF ALL
DIVIDENDS AND CAPITAL GAINS. THE INDEX'S PERFORMANCE DOES NOT INCLUDE A SALES
CHARGE AND HAS BEEN ADJUSTED TO REFLECT REINVESTMENT OF ALL DIVIDENDS AND
CAPITAL GAINS ON MUTUAL FUNDS INCLUDED IN THE BENCHMARK.
THE LIPPER GROWTH AND INCOME FUND INDEX, AN EQUALLY-WEIGHTED PERFORMANCE
INDICATOR, TRACKS THE TOTAL RETURNS OF THE 30 LARGEST GROWTH AND INCOME
FUNDS IN THE INDUSTRY. FUNDS INCLUDED IN THE INDEX ARE REPRESENTATIVE OF
THE MARKET.
- ------------------------------------------------------------------------------
2
<PAGE> 45
- --------------------------------------------------------------------------------
FUND COMMENTARY
VISTA CAPITAL GROWTH FUND
The Vista Capital Growth Fund turned in strong returns
during the last year in a very positive period for U.S.
stocks. The Fund's total return for the 12 months ended
October 31, 1995, was 13.89% (A shares, without sales
charge).
In late 1994, uncertainty dominated the stock market as
economic signals remained unclear. Economic conditions soon
began to improve, however, characterized by low inflation,
solid corporate earnings results and a firmer U.S. dollar.
In the second and third quarters of 1995, the market
climbed to record highs as the threat of inflation
dissipated and on lower short-term interest rates. Cyclical
issues soared on economic news, while technology issues
outperformed on very strong earnings results. The market was
further helped as the dollar stabilized against major
foreign currencies. The fiscal period ended on a negative
note for equities on disappointing third-quarter earnings
results in the cyclical area and mixed economic data.
For the period under review, the Fund's return
benefited from timely stock selection and sector weighting
decisions, including an emphasis on the financial, consumer
cyclical and technology sectors.
Going forward, we see the most promise in the basic
industry, capital goods, technol- ogy and transportation
sectors; we also like some consumer cyclical and financial
issues. Given current stock valuations, we will continue
to hold about 10% of the Fund in cash -- a position we will
adjust in order to take advantage of opportunities. Overall,
we believe that the Fund is positioned to benefit from any
growth potential in the months ahead as economic conditions
remain positive for growth stocks.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
CLASS A SHARES WITHOUT SALES WITH SALES
One Year CHARGE CHARGE
<S> <C> <C>
Five Years 13.89% 8.48%
Since Inception (9/23/87) 25.37% 24.15%
20.32% 19.60%
<CAPTION>
<S> <C> <C>
CLASS B SHARES WITHOUT CDSC WITH CDSC*
One Year 13.34% 8.34%
Since Inception (11/5/93) 8.72% 6.85%
</TABLE>
*Assumes a 5% CDSC for the one-year period and
a 4% CDSC for the period since inception.
- -----------------------------------------------------------------
<TABLE>
<CAPTION>
---------------------------------------------
GROWTH OF $10,000
[GRAPH]
Vista Capital Growth Fund Lipper Mid-Cap Fund Index
<S> <C> <C>
09/30/87 9525 10000.00
9525 7255.92
9525 6782.77
12/31/87 9525 7794.45
9525 7764.98
9525 8439.61
9953.625 8610.01
10658.475 8763.26
10582.275 8537.67
11110.9125 9161.40
11168.3332364341085 8810.42
10986.5009043927649 8441.22
11072.6320090439277 8775.59
11063.0618863049096 8594.47
10967.3606589147287 8312.61
12/31/88 11737.7555394056848 8665.20
12280.1278529091732 9186.58
12894.1342455546319 9153.89
13856.0775940325171 9418.06
14951.0556609169184 10026.78
15749.2639713560147 10614.07
15616.2292529494986 10214.33
16518.362018558135 10870.74
16964.2437302957369 11231.37
17430.864126300204 11401.77
16829.4422825611131 10962.91
16860.5503089614109 11062.04
12/31/89 16950.7635855222745 11150.45
16091.6605577959994 10195.57
16212.8161129881664 10559.95
16675.4100509946222 11017.56
16389.0423750858639 10739.46
17424.3716649098364 11931.72
17592.8880280407596 12071.58
16911.0797880722169 11705.06
15189.7934117581908 10392.77
14407.3905134336335 9611.50
13781.4681947739877 9282.49
14910.3638052137061 10098.59
12/31/90 15937.547038871232 10634.97
17469.353680063096 11536.27
18730.8415022211016 12483.11
20206.3317227809118 13194.18
19361.5854133001045 13137.92
20746.9693608486285 13810.41
19575.587811701909 13077.91
21400.2398401804529 13903.65
22864.4667766138523 14429.85
23303.7348575438721 14421.28
24801.7516463565038 14915.33
23844.3724956115888 14411.10
12/31/91 27212.0944494084074 16133.85
28225.7900207853763 16557.71
29476.0145588169711 16805.81
28023.0509065099825 16055.09
27155.7780287763536 15457.08
27313.4640065461043 15532.63
26251.3363134255692 14860.14
27389.7583690958064 15429.75
26566.9384674727637 15034.29
27299.5863250823223 15339.19
28314.0218202340188 15932.37
29779.3175354531361 17016.93
12/31/92 30736.2683525462365 17537.77
31978.4831283814384 17837.31
31579.6068242141717 17059.79
32981.3721217162804 17657.80
32058.2583892148918 17065.69
33311.8696308834442 18116.49
33552.3350599671393 18283.67
34020.4009794835234 18315.82
35904.0808994884835 19152.81
36691.8015933087396 19805.47
36543.3904480962276 19920.14
35687.1723026394275 19351.07
12/31/93 36937.2507950063556 20229.86
37834.1818297636844 20763.56
37799.2364647731391 20668.71
36436.3672301418734 19553.08
36715.9301500662356 19545.58
36354.8280451639344 19204.78
35344.906996937176 18396.19
36125.6879955506909 18817.37
37803.784470182723 20015.53
37628.9827540752196 19970.52
37500.7948289297172 20326.86
35811.0449065571849 19445.39
12/31/94 36453.1498770587471 19796.37
36202.4076080059356 19572.39
37790.4419786737421 20434.57
39020.2731078375322 21054.01
39366.5362412914148 21239.41
40166.523480650385 21595.75
41138.4482759312831 23008.78
43522.4177595976563 24796.90
43714.0936979828923 25122.70
44145.3645593496734 25910.93
10/31/95 42707.7950214604031 25309.71
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT
RETURN AND PRINCIPAL VALUE WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES
ARE REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN
CLASS A SHARES OF THE VISTA CAPITAL GROWTH FUND AND THE LIPPER MID-CAP FUND
INDEX FROM SEPTEMBER 30, 1987 TO OCTOBER 31, 1995. THE FUND'S total
PERFORMANCE INCLUDES A 4.75% SALES CHARGE AND ASSUMES THE REINVESTMENT OF ALL
DIVIDENDS AND CAPITAL GAINS. THE INDEX'S PERFORMANCE DOES NOT INCLUDE A SALES
CHARGE AND HAS BEEN ADJUSTED TO REFLECT REINVESTMENT OF ALL DIVIDENDS AND
CAPITAL GAINS ON MUTUAL FUNDS INCLUDED IN THE BENCHMARK.
THE LIPPER MID-CAP FUND INDEX, AN EQUALLY-WEIGHTED PERFORMANCE INDICATOR,
TRACKS THE TOTAL RETURNS OF THE 30 LARGEST MID-CAP FUNDS IN THE INDUSTRY. FUNDS
INCLUDED IN THE INDEX ARE REPRESENTATIVE OF THE MARKET.
- -------------------------------------------------------------------------------
3
<PAGE> 46
---------------------------------------------------------------
FUND COMMENTARY
VISTA INTERNATIONAL EQUITY FUND
The international equity markets provided a very mixed
bag of returns over the period under review, generally
lagging the robust double-digit returns provided by U.S.
equities. For the fiscal year, the Fund's total return was
-1.19% (A shares, without sales charge).
Japanese equities declined as corporations struggled
with weak consumer demand, increased competition and the
strong yen, all of, which helped squeeze product prices and
profit margins. A rate cut by the Bank of Japan in July and
a shift in policy supportive of a weaker yen enabled
equities to rally, but the reversal in the last third of the
fiscal year was not sufficient to offset the decline in the
earlier period. The Fund benefited from its technology
additions in the latter part of the year.
European equities rose on signs of sustained economic
growth with no expectations of any significant increases in
interest rates or inflation. As in the U.S., earnings surged
as corporations reaped the benefits of past restructuring
efforts, better inventory and cost management, and the
pickup in export and domestic demand. The Fund realized some
of its best gains from its holdings in Switzerland, Sweden
and the Netherlands due to the region's significant
outperformance from its drug, technology and financial
services industries.
The Fund's performance was hampered by its holdings in
the developing markets of Southeast Asia, which declined.
Looking ahead, we are very optimistic about the global
stock markets for several reasons. Japan is beginning to
fund a bailout of the banking system by aggressively
increasing the money supply and is working to include public
funds in the process. This stronger monetary policy should
improve liquidity, creating economic activity, greater
investment and, we believe, potentially stronger stock value.
We anticipate a continuation of economic growth in the
other Asian nations, which should spark renewed interest in
stocks. Malaysia, Thailand and Korea, in particular, appear
to offer good values because of their attractive
price/earnings ratios relative to growth in company
earnings.
As for Europe, we think the market still has some room
to grow. We expect interest rates to decline. If this trend
occurs, we will consider reducing our holdings in financials
and other interest rate-sensitive stocks in favor of
consumer cyclicals.
In Latin America, we tend to favor banks with strong
market positions and unburdened by state involvement, as well
as utilities. We continue to see opportunities primarily in
Brazil.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
WITHOUT
SALES WITH SALES
CLASS A SHARES CHARGE CHARGE
<S> <C> <C>
One Year (1.19%) (5.88%)
Since Inception
(12/31/92) 8.60% 6.75%
<CAPTION>
<S> <C> <C>
CLASS B SHARES WITHOUT CDSC WITH CDSC*
One Year (1.61%) (6.53%)
Since Inception (11/5/93) 1.69% (0.30%)
</TABLE>
*Assumes a 5% CDSC for the one-year period and a 4% CDSC
for the period since inception.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------
GROWTH OF $10,000
Vista International Equity Fund Lipper International Equity Fund Index
<S> <C> <C>
12/31/92 9525 10000.00
9458.325 10036.59
9601.2 10261.38
9906 10857.03
10382.25 11419.16
10753.725 11682.70
10248.9 11452.68
10572.75 11815.24
11249.025 12597.86
11153.775 12550.81
11258.55 13172.29
10658.475 12649.21
12/31/93 11567.16 13917.70
12284.7257568238213 14785.81
11940.2941935483871 14430.33
11461.9170223325062 13771.02
11605.4301736972705 14135.42
11461.9170223325062 14113.28
11366.24158808933 13891.26
11634.1328039702233 14319.62
11921.1591066997519 14813.79
11576.7275434243176 14430.94
11777.6459553349876 14688.64
11146.1880893300248 14002.89
12/31/94 11066.7774789081886 13793.47
10330.9287576509512 13110.79
10418.0687377998346 13111.71
10844.0864185277089 13456.12
11095.8241389578164 13950.29
11221.6929991728701 14087.44
11231.3752191894127 14138.18
11821.9906401985112 14914.96
11686.4395599669148 14662.80
11821.9906401985112 14907.89
10/31/95 11638.0284598842018 14599.15
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN
AND PRINCIPAL VALUE WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
INTERNATIONAL INVESTING INVOLVES SPECIAL RISKS, SUCH AS CURRENCY FLUCTUATIONS
AND DIFFERENCES IN ACCOUNTING AND TAXATION STANDARDS.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN
CLASS A SHARES OF THE VISTA INTERNATIONAL EQUITY FUND AND THE LIPPER
INTERNATIONAL EQUITY FUND INDEX FROM DECEMBER 31, 1992 TO OCTOBER 31, 1995.
THE FUND'S PERFORMANCE INCLUDES A 4.75% SALES CHARGE AND ASSUMES THE
REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS. THE INDEX'S PERFORMANCE DOES
NOT INCLUDE A SALES CHARGE AND HAS BEEN ADJUSTED TO REFLECT REINVESTMENT OF
ALL DIVIDENDS AND CAPITAL GAINS ON MUTUAL FUNDS INCLUDED IN THE BENCHMARK.
THE LIPPER INTERNATIONAL EQUITY FUND INDEX, AN EQUALLY-WEIGHTED PERFORMANCE
INDICATOR, TRACKS THE TOTAL RETURNS OF THE 30 LARGEST INTERNATIONAL EQUITY
FUNDS IN THE INDUSTRY. FUNDS INCLUDED IN THE INDEX ARE REPRESENTATIVE OF THE
MARKET.
- --------------------------------------------------------------------------------
4
<PAGE> 47
VISTA MUTUAL FUNDS
STATEMENT OF ASSETS AND LIABILITIES October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista Vista Vista
Growth & Capital International
Income Growth Equity
Fund Fund Fund
-------------- -------------- -------------
<S> <C> <C> <C>
ASSETS:
Investment in Portfolio, at value (Note 1)........... $1,798,419,075 $1,017,602,669 $ 34,369,325
Receivable for Fund shares sold...................... 2,233,036 2,500,018 70,210
Unamortized organization costs (Note 1).............. -- -- 10,076
Other assets......................................... 2,768 -- 60,150
-------------- -------------- -------------
Total assets..................................... 1,800,654,879 1,020,102,687 34,509,761
-------------- -------------- -------------
LIABILITIES:
Dividends payable.................................... 36,577 -- --
Payable for redemptions.............................. 3,190,623 10,596,884 1,291,678
Accrued liabilities:
Administration fees................................ 77,059 32,768 --
Distribution fees.................................. 628,024 389,859 10,576
Shareholder servicing fees......................... 385,385 210,887 7,635
Sub-administration fees............................ 77,059 52,784 --
Other.............................................. 1,085,472 868,524 153,402
-------------- -------------- -------------
Total liabilities................................ 5,480,199 12,151,706 1,463,291
-------------- -------------- -------------
NET ASSETS:
Paid-in-capital...................................... 1,495,427,462 866,852,584 32,553,264
Accumulated undistributed net investment income...... 1,921,909 340,988 126,692
Accumulated undistributed net realized gain (loss) on
investment transactions............................ 88,766,486 37,430,396 (2,282,883)
Net unrealized appreciation (depreciation) from
Portfolio.......................................... 209,058,823 103,327,013 2,649,397
-------------- -------------- -------------
Net assets....................................... $1,795,174,680 $1,007,950,981 $ 33,046,470
============= ============= ==========
Class A Shares................................... $1,521,489,288 $ 747,574,610 $ 26,286,788
============= ============= ==========
Class B Shares................................... $ 273,685,392 $ 260,376,371 $ 6,759,682
============= ============= ==========
Shares of beneficial interest outstanding (no par
value; unlimited number of shares authorized)
Class A Shares................................... 43,526,398 20,969,122 2,186,098
============= ============= ==========
Class B Shares................................... 7,863,389 7,356,595 568,398
============= ============= ==========
Class A Shares
Net asset value and redemption price per share (net
assets/shares outstanding)......................... $34.96 $35.65 $12.02
============= ============= ==========
Maximum offering price per share (net asset value per
share/95.25%)...................................... $36.70 $37.43 $12.62
============= ============= ==========
Class B Shares
Net asset value and offering price (net assets/shares
outstanding)....................................... $34.81 $35.39 $11.89
============= ============= ==========
</TABLE>
See notes to financial statements.
5
<PAGE> 48
VISTA MUTUAL FUNDS
STATEMENT OF OPERATIONS For the Year Ended October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista Vista Vista
Growth & Capital International
Income Growth Equity
Fund Fund Fund
------------- ------------- -------------
<S> <C> <C> <C>
NET INVESTMENT INCOME:
Investment income from Portfolio........................ $ 55,880,630 $ 17,904,502 $ 827,508
Expenses from Portfolio................................. (7,802,851) (4,332,826) (342,259)
Foreign taxes withheld from Portfolio................... (117,992) (2,844) (107,048)
------------- ------------- -------------
Total investment income net of expenses from
Portfolio........................................ 47,959,787 13,568,832 378,201
------------- ------------- -------------
EXPENSES:
Distribution fees (Note 2)
Class A............................................... 3,610,606 1,673,901 75,652
Class B............................................... 1,619,344 1,510,615 55,080
Administration fee (Note 2)............................. 830,077 435,668 18,799
Shareholder servicing fees (Note 2)..................... 4,150,388 2,177,440 94,012
Sub-administration fee (Note 2)......................... 830,077 435,488 18,799
Accounting fees......................................... 17,002 15,002 10,000
Printing and postage.................................... 160,001 114,658 10,823
Professional fees....................................... 125,195 79,093 16,203
Registration fees....................................... 178,027 291,727 43,000
Transfer agent fees..................................... 5,283,636 3,172,206 280,639
Trustee fees (Note 2)................................... 101,149 53,049 2,402
Miscellaneous expenses.................................. 366,463 33,901 11,933
Amortization of organization costs (Note 1)............. -- -- 4,693
------------- ------------- -------------
Total expenses...................................... 17,271,965 9,992,748 642,035
------------- ------------- -------------
Less fees waived (Note 2)................................. 252,586 116,282 37,598
Less expenses borne by the Distributor (Note 2)........... -- -- 157,053
------------- ------------- -------------
Net expenses............................................ 17,019,379 9,876,466 447,384
------------- ------------- -------------
Net investment income (loss).............................. 30,940,408 3,692,366 (69,183)
------------- ------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) from portfolio on:
Investment transactions -- net.......................... 78,386,300 37,651,492 (2,495,944)
Financial futures transactions -- net................... 14,956,724 -- --
Foreign currency transactions -- net.................... 61 -- 146,222
Change in unrealized appreciation (depreciation) from
portfolio -- net........................................ 148,638,515 81,591,993 1,392,900
------------- ------------- -------------
Net realized and unrealized gain (loss) on investments,
futures contracts and foreign currency transactions..... 241,981,600 119,243,485 (956,822)
------------- ------------- -------------
Net increase (decrease) in net assets resulting from
operations.............................................. $ 272,922,008 $ 122,935,851 $ (1,026,005)
=========== =========== ==========
</TABLE>
See notes to financial statements.
6
<PAGE> 49
VISTA MUTUAL FUNDS
STATEMENT OF CHANGES IN NET ASSETS For the Periods Indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista
Vista Vista International
Growth & Income Capital Growth Equity
Fund Fund Fund
------------------------------- --------------------------------- -----------------------------
Year ended
---------------------------------------------------------------------------------------------------
10/31/95 10/31/94 10/31/95 10/31/94 10/31/95 10/31/94
-------------- -------------- ---------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................... $ 30,940,408 $ 20,188,114 $ 3,692,366 $ 1,219,028 ($ 69,183) ($ 111,892)
Realized gain (loss) on
investments -- net........ -- (190,671) -- 1,042,946 -- --
Realized gain (loss) from
Portfolio -- net.......... 93,343,085 (3,949,198) 37,651,492 14,534,082 (2,349,722) 484,758
Change in unrealized
appreciation/ depreciation
on investments -- net..... -- (15,154,511) -- (6,036,698) -- --
Change in unrealized
appreciation/depreciation
on investments and foreign
exchange from
portfolio -- net.......... 148,638,515 9,119,159 81,591,993 4,199,552 1,392,900 649,119
-------------- -------------- ---------------- -------------- ------------- -------------
Net increase (decrease) in
net assets resulting
from operations......... 272,922,008 10,012,893 122,935,851 14,958,910 (1,026,005) 1,021,985
-------------- -------------- ---------------- -------------- ------------- -------------
NET EQUALIZATION CREDITS
(DEBITS) (Note 1e).......... (295,049) 85,278 245,128 (8,650) -- --
-------------- -------------- ---------------- -------------- ------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS
FROM: (Note 1F)
Net investment income
Class A................... (27,751,120) (17,180,925) (3,663,589) (291,172) -- --
Class B................... (3,129,991) (1,103,686) (610,166) (29,031) -- --
Net realized gain on
investment transactions
Class A................... -- (11,615,863) (12,038,185) (5,247,371) (386,155) (91,800)
Class B................... -- (189,369) (3,140,097) (82,698) (85,074) (2,311)
-------------- -------------- ---------------- -------------- ------------- -------------
(30,881,111) (30,089,843) (19,452,037) (5,650,272) (471,229) (94,111)
-------------- -------------- ---------------- -------------- ------------- -------------
TRANSACTIONS IN SHARES OF
BENEFICIAL INTEREST (Note
4):
Proceeds from shares sold
Class A................... 337,830,616 746,436,321 1,239,572,225 705,892,770 21,109,068 38,475,927
Class B................... 98,186,608 165,681,398 135,751,317 125,746,131 4,133,925 7,401,283
Reinvestment of dividends
Class A................... 24,946,995 24,911,262 14,790,541 4,863,342 319,993 64,415
Class B................... 2,937,427 1,194,752 3,597,211 103,560 83,935 2,237
Payments for shares redeemed
Class A................... (464,207,149) (287,140,074) (1,136,103,052) (394,079,909) (31,703,235) (15,749,846)
Class B................... (20,539,855) (6,282,431) (27,020,386) (3,427,055) (4,508,509) (303,624)
-------------- -------------- ---------------- -------------- ------------- -------------
Net increase (decrease)
in net assets from
transactions in shares
of beneficial
interest.............. (20,845,358) 644,801,228 230,587,856 439,098,839 (10,564,823) 29,890,392
-------------- -------------- ---------------- -------------- ------------- -------------
Total increase
(decrease) in net
assets................ 220,900,490 624,809,556 334,316,798 448,398,827 (12,062,057) 30,818,266
NET ASSETS:
Beginning of year........... 1,574,274,190 949,464,634 673,634,183 225,235,356 45,108,527 14,290,261
-------------- -------------- ---------------- -------------- ------------- -------------
End of year................. $1,795,174,680 $1,574,274,190 $ 1,007,950,981 $ 673,634,183 $ 33,046,470 $ 45,108,527
============== ============== ================ ============== ============= =============
</TABLE>
See notes to financial statements.
7
<PAGE> 50
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995
- --------------------------------------------------------------------------------
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES -- Mutual Fund Group (the
"Trust") was organized as a Massachusetts business trust on May 11, 1987, and is
registered under the Investment Company Act of 1940, as amended, (the "1940
Act") as an open-end management investment company. Vista Growth and Income Fund
(GIF), Vista Capital Growth Fund (CGF) and Vista International Equity Fund (IEF)
(collectively the "Funds") are three separate series of the Trust. The Funds
each offer two classes of shares. Class "A" Shares are sold with a front end
sales load and Class "B" Shares, which were first available on November 4, 1993,
are sold with a contingent deferred sales load. All classes of shares have equal
rights as to earnings, assets and voting privileges except that each class may
bear different distribution and fund servicing expenses, and each class has
exclusive voting rights with respect to its distribution plan.
Effective November 29, 1993, Vista Growth and Income Fund and Vista Capital
Growth Fund adopted the Master Feeder Fund structure through the contribution of
their investment assets ($978 million and $241 million, respectively) to their
respective portfolios in exchange for beneficial interests in such portfolios of
an equal value. Prior thereto each Fund owned individual investment securities.
Vista International Equity Fund also utilizes the Master Feeder Fund Structure.
The Trust seeks to achieve each Fund's investment objective by investing all of
the investable assets of the corresponding Fund in the Growth and Income
Portfolio, Capital Growth Portfolio and International Equity Portfolio (the
"Portfolios") which, like the Funds, are open-end management investment
companies having the same investment objectives as the Funds. The Funds, the
Portfolios in which they invest, and the percentage of each portfolio owned by
the respective Fund at October 31, 1995 are shown below.
<TABLE>
<CAPTION>
Fund's Percentage
Interest in the
Portfolio at
Fund Portfolio October 31, 1995
- ------------------------------- ------------------------------ -----------------
<S> <C> <C>
Vista Growth and Income Fund Growth and Income Portfolio 96.99%
Vista Capital Growth Fund Capital Growth Portfolio 99.82%
Vista International Equity Fund International Equity Portfolio 99.99%
</TABLE>
The financial statements of each Portfolio, including the portfolio of
investments, are included elsewhere in this report and should be read in
conjunction with the financial statements of the Funds.
The following is a summary of significant accounting policies followed by the
Funds:
A. Valuation of Investments -- The Funds record their investments in the
Portfolios at value. Securities of the Portfolios are recorded at value as
more fully discussed in the Notes to those Financial Statements.
B. Investment Income, Expenses, and Distributions to Shareholders -- The
Funds record daily their pro-rata share of the respective Portfolio's
income, expenses, and realized and unrealized gains and losses. In
addition, the Funds accrue their own expenses daily as incurred. Expenses
directly attributable to a Fund are charged to that Fund; other expenses
are allocated proportionately among each Fund
8
<PAGE> 51
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
within the Trust in relation to the net assets of each Fund or on another
reasonable basis. Distributions to shareholders are recorded on the
ex-dividend date. In calculating net asset value per share of each class,
investment income, realized and unrealized gains and losses and expenses
other than class specific expenses, are allocated daily to each class of
shares based upon the proportion of net assets of each class at the
beginning of each day. The amount of dividends and distributions from net
investment income and net realized capital gains is determined in
accordance with federal income tax regulations, which may differ from
generally accepted accounting principles. To the extent these "book/tax"
differences are permanent in nature (i.e., that they result from other than
timing of recognition -- "temporary differences"), such amounts are
reclassified within the capital accounts based on their federal tax-basis
treatment. The reclassifications made for the Funds are as follows: GIF
paid in capital was decreased by $112,825, accumulated undistributed net
investment income (loss) was increased by $295,049 and accumulated
undistributed net realized gain (loss) on investment transactions was
decreased by $182,224; CGF paid in capital was increased by $275,766,
accumulated undistributed net investment income (loss) was decreased by
$221,576 and accumulated undistributed net realized gain (loss) on
investment transactions was decreased by $54,190; IEF paid in capital was
decreased by $214,508, accumulated undistributed net investment income
(loss) was increased by $148,468 and accumulated undistributed net realized
gain (loss) on investment transactions was increased by $66,040. Dividends
and distributions which exceed net investment income or net realized gains
for financial reporting purposes but not for tax purposes are reported as
distributions in excess of net investment income or net realized gains.
C. Federal Income Taxes -- Each Fund is treated as a separate taxable
entity for Federal income tax purposes. The Fund's policy is to comply with
the provisions of the Internal Revenue Code applicable to regulated
investment companies and to distribute to shareholders all of the Fund's
distributable net income, including any net realized gain on investments.
In addition, the Fund intends to make distributions as required to avoid
excise taxes. Accordingly, no provisions for Federal income or excise tax
are necessary.
D. Organization Costs -- Organization and initial registration costs
incurred in connection with establishing the Funds have been deferred and
are being amortized on a straight-line basis over a sixty-month period
beginning at the commencement of operations of each Fund.
E. Equalization -- GIF and CGF follow the accounting practice known as
equalization by which a portion of the proceeds from sales and costs of
redemptions of Trust shares of beneficial interest equivalent, on a
per-share basis, to the amount of undistributed net investment income on
the date of the transactions, is credited or charged to undistributed net
investment income. As a result, undistributed net investment income per
share is unaffected by sales or redemptions of Trust shares.
F. Foreign Currency Translations -- The books and records of the
Portfolios are maintained in U.S. dollars, the foreign currency translation
policy is more fully discussed in the notes to those financial statements.
9
<PAGE> 52
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
2. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A. Administration Fees -- Pursuant to an Administration Agreement, The
Chase Manhattan Bank, N.A. (the "Administrator") serves as administrator of
the Funds. The Administrator receives from each of the Funds a fee computed
daily and paid monthly at an annual rate equal to 0.05% of the respective
average daily net assets of each Fund. The Administrator has voluntarily
waived all or a portion of its fees as outlined in Note 2.D. below.
B. Shareholder Servicing Fees -- The Trust has adopted an Administrative
Services Plan which, among other things, provides that the Trust on behalf
of the Funds may obtain the services of one or more Shareholder Servicing
Agents. For its services, each Shareholder Servicing Agent will receive
fees determined by a formula based upon the average number of accounts
serviced and the number of transactions processed by such Shareholder
Servicing Agent during the period for which payment is being made, and any
out-of-pocket expenses incurred, provided that such fees will not exceed,
on an annualized basis, 0.25% of the average daily net assets of the
respective Fund. Chase's Shareholder Servicing charges amounted to
$4,149,991 and $2,161,888 for GIF and CGF respectively, and all related
charges paid for IEF. Chase voluntarily waived such fees as indicated in
2.D. below.
C. Distribution and Sub-administration Fees -- Pursuant to a Distribution
and Sub-administration Agreement, Vista Broker-Dealer Services, Inc.
("VBDS" or the "Distributor"), a wholly-owned subsidiary of Concord Holding
Corp., a wholly owned subsidiary of The BISYS Group, acts as the Trust's
exclusive underwriter and promotes and arranges for the sale of each Fund's
shares. In addition, the Distributor provides certain sub-administration
services to the Trust, including providing officers, clerical staff and
office space for an annual fee of 0.05% of the average daily net assets of
each Fund.
The Trustees have adopted Distribution Plans (the "Distribution Plans") for
both Class A and Class B for each of the Funds in accordance with Rule
12b-1 under the 1940 Act.
The Class A Distribution Plans provide that the Funds shall pay
distribution fees, including payments to the Distributor at annual rates
not to exceed 0.20% for GIF and CGF and 0.25% for IEF of the average daily
net assets of each Fund for distribution services. The Class B Distribution
Plans provide that the Funds shall pay distribution fees including payments
to the Distributor, at an annual rate not to exceed 0.75% of the average
daily net assets of the Class B Shares of each Fund for distribution
services.
Under the Class A Distribution Plans for GIF and CGF, the Class A shares
are also permitted to pay an additional fee at an annual rate not to exceed
0.05% of its average daily net assets in anticipation of, or as
reimbursement for, expenses incurred in connection with print or electronic
media advertising in connection with the sale of Fund shares. When such
expenses are incurred, the maximum compensation paid by the Class A shares
under the Class A Distribution Plan would be at an annual rate of 0.25% of
its average daily net assets.
10
<PAGE> 53
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
D. Waivers of Fees -- For the year ended October 31, 1995, the
Administrator, Sub-administrator and Shareholder Servicing Agents
voluntarily waived fees for each of the Funds as follows:
<TABLE>
<CAPTION>
Fee GIF CGF IEF
-------------------------------------------------------------------- -------- -------- -------
<S> <C> <C> <C>
Administration...................................................... $252,586 $116,282 $18,799
Sub-administration.................................................. -- -- 18,799
-------- -------- -------
Total............................................................... $252,586 $116,282 $37,598
======== ======== =======
</TABLE>
In addition, during the year ended October 31, 1995, the distributor
voluntarily assumed $157,053 in expenses on behalf of Vista International
Equity Fund.
E. Other -- Certain officers of the Trust are officers of VBDS or of its
parent corporation, BISYS. The Funds' organizational costs payable are
comprised of liabilities owed to the Administrator and the Distributor. In
addition, the Portfolios have entered into contracts with the Chase
Manhattan Bank, N.A. for Investment Advisory and Custodian services.
On August 27, 1995, the Chase Manhattan Corporation and Chemical Banking
Corporation announced an agreement in principle to merge, which was
approved by shareholders of both corporations on December 11, 1995, subject
to the approval of regulators.
3. INVESTMENT TRANSACTIONS -- Increases and decreases in each Fund's
investment in its related Portfolio during the year ended October 31, 1995, were
as follows:
<TABLE>
<CAPTION>
Increases in Decreases in
Fund Portfolio Investment Portfolio Investment
- -------------------------------------------------------- -------------------- --------------------
<S> <C> <C>
Vista Growth and Income................................. $ 439,999,840 $ 505,023,016
Vista Capital Growth.................................... 1,381,868,640 1,167,007,842
Vista International Equity.............................. 25,695,635 35,602,380
</TABLE>
11
<PAGE> 54
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
4. TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST -- Transactions in shares of
beneficial interest for the periods indicated, are as follows:
<TABLE>
<CAPTION>
Growth and Capital International
Income Fund Growth Fund Equity Fund
--------------------------- ---------------------------- --------------------------
Year ended
-----------------------------------------------------------------------------------------
10/31/95 10/31/94 10/31/95 10/31/94 10/31/95 10/31/94
------------ ----------- ------------ ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
CLASS A:
Shares sold........... 10,674,446 24,777,633 37,056,900 22,299,824 1,812,964 3,171,063
Shares issued in
reinvestment of
distributions....... 781,341 826,616 476,453 153,594 28,001 5,302
Shares redeemed....... (14,660,747) (9,512,086) (33,640,091) (12,413,694) (2,735,407) (1,304,737)
------------ ----------- ------------ ------------ ----------- -----------
Net increase in shares
of beneficial
interest
outstanding......... (3,204,960) 16,092,163 3,893,262 10,039,724 (894,442) 1,871,628
Outstanding shares at:
Beginning of
period............ 46,731,358 30,639,195 17,075,860 7,036,136 3,080,540 1,208,912
------------ ----------- ------------ ------------ ----------- -----------
End of period....... 43,526,398 46,731,358 20,969,122 17,075,860 2,186,098 3,080,540
========== ========= ========== ========== ========= =========
CLASS B:
Shares sold........... 3,087,386 5,491,462 4,172,672 3,983,592 361,483 612,140
Shares issued in
reinvestment of
distributions....... 92,139 40,161 117,362 3,298 7,428 194
Shares redeemed....... (637,757) (210,002) (812,120) (108,209) (387,778) (25,069)
------------ ----------- ------------ ------------ ----------- -----------
Net increase in shares
of beneficial
interest
outstanding......... 2,541,768 5,321,621 3,477,914 3,878,681 (18,867) 587,265
Outstanding shares at:
Beginning of
period............ 5,321,621 -- 3,878,681 -- 587,265 --
------------ ----------- ------------ ------------ ----------- -----------
End of period....... 7,863,389 5,321,621 7,356,595 3,878,681 568,398 587,265
========== ========= ========== ========== ========= =========
</TABLE>
5. FEDERAL INCOME TAX MATTERS -- At October 31, 1995, the Vista International
Equity Fund had a net capital loss carryover of approximately $6,149,000 which
will be available to offset capital gains arising through October 31, 2002 and
2003. To the extent that these carryover losses are used to offset future gains,
the gains so offset will not be distributed to shareholders.
6. RETIREMENT PLAN -- During the year ended October 31, 1995, the Trust
adopted an unfunded noncontributory defined benefit pension plan covering all
independent directors of the Trust who have served as an independent director of
the Trust, or other Vista Funds, for at least five years at the time of
retirement. Benefits under this plan are based on compensation and years of
service. Management has determined that the accrual for prior service costs is
not material.
12
<PAGE> 55
VISTA MUTUAL FUNDS
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OF BENEFICIAL INTEREST
OUTSTANDING
Throughout Each Period Indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista
Growth & Income
Vista Growth & Income Fund--Class A Fund--Class B
---------------------------------------------------- ------------------
Year ended Year 11/4/93*
---------------------------------------------------- ended through
10/31/95 10/31/94 10/31/93 10/31/92 10/31/91 10/31/95 10/31/94
---------- ---------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of Period................ $ 30.26 $ 30.99 $ 26.60 $ 25.49 $ 16.49 $ 30.12 $ 30.39
---------- ---------- -------- -------- -------- -------- -------
Income From Investment Operations
Net Investment Income............................ 0.614 0.466 0.341 0.313 0.388 0.463 0.336
Net Gains or Losses on Securities
(both realized and unrealized)................. 4.710 (0.429 ) 5.007 2.702 9.521 4.700 0.109
---------- ---------- -------- -------- -------- -------- -------
Total from Investment Operations................. 5.324 0.037 5.348 3.015 9.909 5.163 0.445
---------- ---------- -------- -------- -------- -------- -------
Less Distributions
Dividends from net investment income............. 0.621 0.422 0.338 0.313 0.339 0.470 0.370
Distributions from capital gains................. -- 0.345 0.620 1.587 0.574 -- 0.345
---------- ---------- -------- -------- -------- -------- -------
Total Distributions.............................. 0.621 0.767 0.958 1.900 0.913 0.470 0.715
---------- ---------- -------- -------- -------- -------- -------
Net Asset Value, End of Period...................... $ 34.96 $ 30.26 $ 30.99 $ 26.60 $ 25.49 $ 34.81 $ 30.12
========= ========= ======= ======= ======= ======== ========
Total Return (1).................................... 17.79% 0.15% 20.47% 12.34% 62.60% 17.21% 1.55%
========= ========= ======= ======= ======= ======== ========
Ratios/Supplemental Data**
Net Assets, End of Period (000 omitted)............ $1,521,489 $1,413,899 $949,465 $149,506 $43,261 $273,685 $160,375
Ratio of Expenses to Average Net Assets#........... 1.43% 1.40% 1.39% 1.43% 1.25% 1.93% 1.89%
Ratio of Net Investment Income to Average Net
Assets#.......................................... 1.93% 1.60% 1.07% 1.19% 1.24% 1.38% 1.21%
Ratio of Expenses without waivers and assumption of
expense to Average Net Assets#................... 1.45% 1.40% 1.39% 1.46% 1.76% 1.94% 1.89%
Ratio of Net Investment Income without waivers and
assumption of expenses to Average Net Assets#.... 1.91% 1.60% 1.07% 1.16% 0.73% 1.36% 1.21%
Portfolio Turnover Rate............................. -- -- 41% 56% 103% -- --
</TABLE>
- ---------------
* Date commenced offering classes of shares.
# Short periods have been annualized.
** Ratios include the Fund's share of Portfolio income and expenses, as
appropriate.
(1) Total return figures do not include the effect of any sales load.
See notes to financial statements.
13
<PAGE> 56
VISTA MUTUAL FUNDS
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OF BENEFICIAL INTEREST
OUTSTANDING
Throughout Each Period Indicated (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista
Capital Growth
Vista Capital Growth Fund--Class A Fund--Class B
------------------------------------------------ ------------------
Year ended Year 11/4/93*
------------------------------------------------ ended through
10/31/95 10/31/94 10/31/93 10/31/92 10/31/91 10/31/95 10/31/94
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of Period.............. $ 32.17 $ 32.01 $ 25.12 $ 22.02 $ 12.33 $ 32.03 $ 31.38
------- ------- ------- ------- ------- ------- -------
Income From Investment Operations
Net Investment Income (Loss)................... 0.189 0.099@ 0.064 0.078 (0.011) 0.044 0.011@
Net Gains or (Losses) on Securities (both
realized and unrealized)..................... 4.160 0.719 7.173 3.044 9.805 4.100 1.296
------- ------- ------- ------- ------- ------- -------
Total from Investment Operations............... 4.349 0.818 7.237 3.122 9.794 4.144 1.307
------- ------- ------- ------- ------- ------- -------
Less Distributions
Dividends from net investment income........... 0.189 0.027 0.093 0.017 0.109 0.111 0.026
Distributions from capital gains............... 0.676 0.631 0.257 -- -- 0.676 0.631
------- ------- ------- ------- ------- ------- -------
Total Distributions............................ 0.865 0.658 0.350 0.017 0.109 0.787 0.657
------- ------- ------- ------- ------- ------- -------
Net Asset Value, End of Period.................... $ 35.65 $ 32.17 $ 32.01 $ 25.12 $ 22.02 $ 35.39 $ 32.03
======= ======= ======= ======= ======= ======= ======
Total Return (1).................................. 13.89% 2.62% 29.06% 14.16% 79.96% 13.34% 4.19%
======= ======= ======= ======= ======= ======= ======
Ratios/Supplemental Data**
Net Assets, End of Period (000 omitted).......... $747,575 $549,411 $225,235 $39,836 $ 9,334 $260,376 $124,223
Ratio of Expenses to Average Net Assets#......... 1.51% 1.49% 1.49% 1.40% 1.27% 2.01% 2.00%
Ratio of Net Investment Income (Loss) to Average
Net Assets#.................................... 0.54% 0.33% 0.12% 0.32% (0.09%) 0.02% (0.09%)
Ratio of Expenses without waivers and assumption
of expenses to Average Net Assets#............. 1.53% 1.50% 1.49% 1.77% 3.44% 2.02% 2.02%
Ratio of Net Investment Income (Loss) without
waivers and assumption of expenses to Average
Net Assets#.................................... 0.52% 0.32% 0.12% (0.05%) (2.26%) 0.01% (0.11%)
Portfolio Turnover Rate........................... -- -- 43% 67% 83% -- --
</TABLE>
- ---------------
* Date commenced offering class of shares.
(1) Total return figures do not include the effect of any sales load.
# Short periods have been annualized.
** Ratios include the Fund's share of Portfolio income and expenses, as
appropriate.
@ Calculated based upon average shares outstanding.
See notes to financial statements.
14
<PAGE> 57
VISTA MUTUAL FUNDS
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OF BENEFICIAL INTEREST
OUTSTANDING
Throughout Each Period Indicated (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
International Equity Fund
--------------------------------------------------
Year ended 12/31/92* Year 11/4/93*
------------------ through ended through
10/31/95 10/31/94 10/31/93 10/31/95 10/31/94
-------- -------- --------- -------- --------
Class A Class B
----------------------------- -------------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of Period................................... $ 12.31 $ 11.82 $ 10.00 $ 12.23 $ 11.69
------- ------- -------- ------- -------
Income From Investment Operations
Net Investment Income (Loss)........................................ 0.039 (0.022) (0.010) (0.026) (0.053)
Net Gains or (Losses) on Securities (both realized and
unrealized)....................................................... (0.190) 0.566 1.830 (0.180) 0.647
------- ------- -------- ------- -------
Total from Investment Operations.................................... (0.151) 0.544 1.820 (0.206) 0.594
------- ------- -------- ------- -------
Less Distributions
Distributions from capital gains.................................... 0.137 0.054 -- 0.137 0.054
------- ------- -------- ------- -------
Total Distributions................................................. 0.137 0.054 -- 0.137 0.054
------- ------- -------- ------- -------
Net Asset Value, End of Period......................................... $ 12.02 $ 12.31 $ 11.82 $ 11.89 $ 12.23
======= ======= ======= ======= =======
Total Return (1)....................................................... (1.19%) 4.61% 22.23% (1.61%) 5.09%
======= ======= ======= ======= =======
Ratios/Supplemental Data**
Net Assets, End of Period (000 omitted)............................... $26,287 $37,926 $14,290 $ 6,759 $ 7,182
------- ------- -------- ------- -------
Ratio of Expenses to Average Net Assets#............................... 2.01% 2.00% 2.13% 2.50% 2.50%
Ratio of Net Investment Income (Loss) to Average Net Assets#........... (0.10%) (0.27%) (0.14%) (0.53%) (0.94%)
Ratio of Expenses without waivers and assumption of expenses to Average
Net Assets#(2)........................................................ 2.86% 2.46% 2.86% 3.36% 3.36%
Ratio of Net Investment Income (Loss) without waivers and assumption of
expenses to Average Net Assets#....................................... (0.96%) (0.73%) (2.11%) (1.40%) (1.80%)
</TABLE>
- ---------------
(1) Total return figures do not include the effect of any sales load.
(2) Not to exceed the maximum statutory expense ratio.
* Date commenced offering class of shares.
** Ratios include the Fund's share of Portfolio income and expenses, as
appropriate.
# Short periods have been annualized.
See notes to financial statements.
15
<PAGE> 58
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE TRUSTEES
AND SHAREHOLDERS OF
MUTUAL FUND GROUP
In our opinion, the accompanying statement of assets and liabilities and the
related statements of operations and of changes in net assets and the selected
per share data and ratios for a share of beneficial interest outstanding present
fairly, in all material respects, the financial position of Vista Growth and
Income Fund, Vista Capital Growth Fund and Vista International Equity Fund,
three of the portfolios constituting Mutual Fund Group (hereafter referred to as
the "Trust"), at October 31, 1995, the results of each of their operations for
the year then ended, the changes in each of their net assets for each of the two
years in the period then ended and the selected per share data and ratios for a
share of beneficial interest outstanding for the periods presented, in
conformity with generally accepted accounting principles. These financial
statements and selected per share data and ratios for a share of beneficial
interest outstanding (hereafter referred to as "financial statements") are the
responsibility of the Trust's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, NY 10036
December 15, 1995
16
<PAGE> 59
GROWTH AND INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 86.4%
COMMON STOCK -- 73.3%
Aerospace -- 1.9%
General Motors Class H............. 300,000 $ 12,600,000
Loral Corp. ....................... 320,000 9,480,000
United Technologies, Corp. ........ 150,000 13,312,500
--------------
35,392,500
--------------
Agricultural Production/
Services -- 1.7%
AGCO Corp. ........................ 175,000 7,831,250
Case Corp. ........................ 375,000 14,296,875
Deere & Co. ....................... 100,000 8,937,500
--------------
31,065,625
--------------
Apparel/Textiles -- 0.2%
V.F. Corp. ........................ 75,000 3,590,625
--------------
Automotive -- 2.6%
Chrysler Corp. .................... 214,027 11,049,144
Dana Corp. ........................ 300,000 7,687,500
Echlin, Inc. ...................... 400,000 14,300,000
General Motors..................... 200,000 8,750,000
TRW Inc. .......................... 100,000 6,575,000
--------------
48,361,644
--------------
Banking -- 3.3%
Bank of New York Company, Inc. .... 375,000 15,750,000
Citicorp........................... 265,000 17,191,875
First Bank System Inc. ............ 150,000 7,462,500
NationsBank Corp. ................. 125,000 8,218,750
Norwest Corp. ..................... 415,000 12,242,500
--------------
60,865,625
--------------
Chemicals -- 2.7%
Air Products & Chemicals, Inc. .... 200,000 10,325,000
Dow Chemical Co. .................. 90,000 6,176,250
duPont (EI) deNemours.............. 300,000 18,712,500
Praxair, Inc. ..................... 225,000 6,075,000
Union Carbide Corp. ............... 235,000 8,900,625
--------------
50,189,375
--------------
Computer Software -- 1.5%
Computer Associates
International..................... 200,000 11,000,000
General Motors Corp., Class E...... 200,000 9,425,000
Reynolds & Reynolds, Inc., Class
A................................. 223,000 7,944,375
--------------
28,369,375
--------------
Computers/Computer Hardware -- 4.1%
Apple Computer Inc. ............... 210,000 7,625,625
Comdisco, Inc. .................... 180,000 5,490,000
Compaq Computer*................... 400,000 22,300,000
International Business Machines
Corp. ............................ 75,000 7,293,750
Read-Rite Corp. ................... 250,000 8,718,750
SCI Systems, Inc.*................. 200,000 7,025,000
Sun Microsystems, Inc.*............ 225,000 17,550,000
--------------
76,003,125
--------------
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
Construction Machinery -- 0.8%
Caterpillar Inc. .................. 250,000 $ 14,031,250
--------------
Consumer Products -- 1.7%
Black & Decker Corp. .............. 300,000 10,162,500
Procter & Gamble Co. .............. 100,000 8,100,000
Shaw Industries.................... 195,000 2,486,250
Toro Co. .......................... 120,000 3,465,000
Whirlpool Corp. ................... 130,000 6,890,000
--------------
31,103,750
--------------
Diversified -- 0.7%
Textron, Inc. ..................... 200,000 13,750,000
--------------
Electronics/Electrical
Equipment -- 1.9%
Analog Devices Inc. ............... 200,000 7,225,000
Texas Instruments.................. 250,198 17,076,014
Xilinx, Inc.*...................... 225,000 10,350,000
--------------
34,651,014
--------------
Electronics Distributor -- 0.4%
Arrow Electronics, Inc.*........... 150,000 7,612,500
--------------
Entertainment -- 0.6%
Trump Hotels & Casino Resorts,
Inc. ............................. 325,000 5,525,000
Viacom, Inc. Class B*.............. 125,763 6,288,150
--------------
11,813,150
--------------
Environmental Services -- 0.4%
Browning-Ferris Industries,
Inc. ............................. 250,000 7,281,250
--------------
Financial Services -- 2.7%
Advanta Corp., Class A............. 100,000 3,875,000
American Express Co. .............. 200,000 8,125,000
American General Delaware.......... 450,000 14,793,750
Dean Witter, Discover & Co. ....... 207,806 10,338,349
Federal National Mortgage
Assoc. ........................... 130,000 13,633,750
--------------
50,765,849
--------------
Food/Beverage Products -- 4.1%
Coca-Cola Enterprises, Inc. ....... 400,000 10,650,000
ConAgra, Inc. ..................... 225,000 8,690,625
CPC International, Inc.*........... 100,000 6,637,500
IBP, Inc. ......................... 140,000 8,382,500
PepsiCo., Inc. .................... 250,000 13,187,500
Philip Morris Companies, Inc. ..... 175,000 14,787,500
RJR Nabisco Holdings Corp. ........ 250,000 7,687,500
Seagram Company, Ltd. ............. 200,000 7,200,000
--------------
77,223,125
--------------
Health Care -- 2.6%
Baxter International Inc. ......... 400,000 15,450,000
Columbia/HCA Healthcare Corp. ..... 235,000 11,544,375
FHP International Corp.*........... 200,000 4,850,000
Humana, Inc.*...................... 225,000 4,753,125
Manor Care, Inc. .................. 125,000 4,093,750
Tenet Healthcare Corp.*............ 415,000 7,418,125
--------------
48,109,375
--------------
</TABLE>
See notes to financial statements.
17
<PAGE> 60
GROWTH AND INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
Insurance -- 4.1%
Allstate Corp. .................... 278,110 $ 10,220,543
American International Group....... 142,500 12,023,438
Chubb Corp. ....................... 150,000 13,481,250
Mid Ocean, Ltd.*................... 170,000 6,013,750
Reliastar Financial Corp. ......... 140,000 5,845,000
St. Paul Companies, Inc. .......... 200,000 10,150,000
Transamerica Corp. ................ 150,000 10,162,500
Transport Holdings, Inc., Class
A*................................ 750 29,437
Travelers, Inc. ................... 150,000 7,575,000
--------------
75,500,918
--------------
Manufacturing -- 2.3%
Eaton Corp. ....................... 150,000 7,687,500
Johnson Controls................... 275,000 16,018,750
Kennametal Inc. ................... 175,000 5,446,875
Varity Corp.*...................... 400,000 14,500,000
--------------
43,653,125
--------------
Metals/Mining -- 1.6%
Aluminum Co. of America (ALCOA).... 200,000 10,200,000
Inco, Ltd. ........................ 375,000 12,890,625
Phelps Dodge Corp. ................ 100,000 6,337,500
--------------
29,428,125
--------------
Office/Business Equipment -- 0.4%
Xerox Corp. ....................... 55,000 7,136,250
--------------
Oil & Gas -- 6.2%
Amoco Corp. ....................... 150,000 9,581,250
Ashland Inc. ...................... 250,000 7,906,250
Halliburton Company................ 449,000 18,633,500
Mobil Corp. ....................... 125,000 12,593,750
Panhandle Eastern Corp. ........... 650,000 16,412,500
Phillips Petroleum Co. ............ 355,000 11,448,750
Smith International*............... 194,200 3,107,200
Triton Energy Corp. ............... 250,000 11,656,250
Ultramar Corp. .................... 200,000 4,875,000
Unocal Corp. ...................... 250,000 6,562,500
Williams Companies, Inc. .......... 300,000 11,587,500
--------------
114,364,450
--------------
Paper/Forest Products -- 3.1%
Boise Cascade Corp. ............... 150,000 5,437,500
Champion International Corp. ...... 370,000 19,795,000
Fort Howard Corp.*................. 400,000 6,700,000
Mead Corp. ........................ 170,000 9,796,250
Willamette Industries.............. 261,000 15,138,000
--------------
56,866,750
--------------
Pharmaceuticals -- 2.4%
Allergan Inc. ..................... 150,000 4,406,250
American Home Products Corp. ...... 100,000 8,862,500
Glaxo Wellcome Plc................. 300,000 8,137,500
Schering-Plough Corp. ............. 250,000 13,406,250
Smithkline Beecham Plc, ADR........ 175,000 9,078,125
--------------
43,890,625
--------------
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
Printing & Publishing -- 1.1%
Harcourt General, Inc. ............ 200,000 $ 7,925,000
The News Corporation, Ltd, ADR..... 300,000 5,962,500
Tribune Co. ....................... 125,000 7,890,625
--------------
21,778,125
--------------
Real Estate Investment
Trust -- 0.3%
Hospitality Properties Trust....... 181,000 4,751,250
--------------
Restaurants/Food Services -- 0.3%
Wendy's International, Inc. ....... 325,000 6,459,375
--------------
Retailing -- 5.0%
American Stores Co. ............... 485,000 14,489,375
Circuit City Stores, Inc. ......... 420,000 14,017,500
Dayton-Hudson Corp. ............... 250,000 17,187,500
Kroger Co.*........................ 654,000 21,827,250
May Department Stores.............. 400,000 15,700,000
Sears Roebuck & Co. ............... 300,000 10,200,000
--------------
93,421,625
--------------
Shipping/Transportation -- 3.3%
Burlington Northern, Inc. ......... 100,000 8,387,500
Consolidated Railway, Inc. ........ 200,000 13,750,000
CSX Corp. ......................... 200,000 16,750,000
Federal Express Corp.*............. 100,000 8,212,500
Ryder System....................... 300,000 7,237,500
XTRA Corp. ........................ 155,000 6,800,625
--------------
61,138,125
--------------
Steel -- 0.8%
LTV Corp.*......................... 300,000 4,200,000
USX-US Steel Group, Inc. .......... 340,000 10,157,500
--------------
14,357,500
--------------
Telecommunications -- 3.4%
AT&T Corp. ........................ 225,000 14,400,000
Frontier Corp. .................... 200,000 5,400,000
GTE Corp. ......................... 400,000 16,500,000
Sprint Corp. ...................... 275,000 10,587,500
Tele-Communications, Class A*...... 350,000 5,950,000
U S West, Inc. .................... 200,000 9,525,000
--------------
62,362,500
--------------
Toys & Games -- 0.4%
Mattel, Inc. ...................... 250,000 7,187,500
--------------
Utilities -- 4.7%
CINergy Corp. ..................... 200,000 5,675,000
CMS Energy Corp. .................. 375,000 10,359,375
Eastern Utilities Associates....... 200,000 4,700,000
FPL Group Inc. .................... 285,000 11,934,375
General Public Utilities........... 300,000 9,375,000
Nipsco Industries Inc. ............ 205,000 7,482,500
Oklahoma Gas & Electric Co. ....... 150,000 6,000,000
PECO Energy Co. ................... 259,100 7,578,675
Pinnacle West Capital Corp. ....... 700,000 19,250,000
Public Service Co. of Colorado..... 115,000 3,924,375
--------------
86,279,300
--------------
</TABLE>
See notes to financial statements.
18
<PAGE> 61
GROWTH AND INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
TOTAL COMMON STOCK
(Cost $1,168,160,359)............. $1,358,754,700
--------------
CONVERTIBLE PREFERRED STOCK -- 5.0%
Airlines --
Delta Airlines, Ser. C, $3.50...... 150,000 8,306,250
--------------
Automotive --
Ford Motor Co., Ser. A, 8.4%....... 80,000 7,520,000
--------------
Computers/Computer Hardware --
Ceridian Corp., 5.5%............... 120,000 11,700,000
--------------
Entertainment --
Time Warner Financing Trust,
$1.24............................. 200,000 6,400,000
--------------
Electronics/Electrical
Equipment --
Westinghouse Electric, Ser. C,
$1.30............................. 800,000 10,981,600
--------------
Environmental Services --
Browning-Ferris, Inc., 7.25%....... 88,000 2,893,000
--------------
Financial Services --
American General Delaware, Ser. A,
$3.00............................. 118,000 6,106,500
--------------
Food/Beverage Products --
RJR Nabisco Holdings Corp., Ser. C,
$0.6012........................... 700,000 4,375,000
--------------
Health Care --
FHP International Corp., Ser. A,
5.0%.............................. 225,000 5,343,750
--------------
Oil & Gas --
Diamond Shamrock, 5.0%#............ 120,000 6,540,000
Occidental Petroleum, $3.00........ 140,000 7,910,000
--------------
14,450,000
--------------
Paper/Forest Products --
International Paper Capital Corp.#
5.25%............................. 200,000 8,783,800
--------------
Printing & Publishing --
The News Corporation ADR, $.11..... 200,000 3,650,000
--------------
Steel --
WHX Corp., Ser. B, $3.75........... 48,500 2,037,000
--------------
TOTAL CONVERTIBLE PREFERRED STOCK
(Cost $82,938,090)............... 92,546,900
--------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Issuer Amount (USD) Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
FLOATING RATE NOTES -- 1.3%
Financial Services --
Goldman Sachs#,
5.85% @, due 7/1/96
(Cost $25,000,000)................ $ 25,000,000 $ 24,812,500
--------------
CONVERTIBLE CORPORATE NOTES AND
BONDS -- 5.9%
Airlines --
AMR, Corp., 6.125%, due 11/1/24.... 10,000,000 9,623,400
--------------
Automotive --
Magna International Inc.,
5.0%, due 10/15/02................ 4,500,000 4,584,375
--------------
Computer Software --
Softkey International Inc.#,
5.5%, due 11/1/00................. 7,000,000 5,929,280
--------------
Consumer Products --
Grand Metropoliton Placing#,
6.5%, due 1/31/00................. 2,850,000 3,216,367
--------------
Electronics/Electrical
Equipment --
National Semiconductor,
6.5%, due 10/1/02................. 10,000,000 9,591,500
Sanmina Corp.#, 5.5%, due 8/15/02.. 2,000,000 2,224,440
--------------
11,815,940
--------------
Financial Services --
First Financial Management,
5%, due 12/15/99.................. 5,000,000 7,687,250
MBL International Finance Bermuda,
3%, due 11/30/02.................. 5,000,000 5,222,500
South African Pulp & Paper
Industries, BVI Finance Ltd, 7.5%,
due 8/1/02........................ 6,600,000 6,814,500
--------------
19,724,250
--------------
Insurance --
Aegon NV#, 4.75%, due 11/1/04...... 8,500,000 11,177,500
--------------
Manufacturing --
3 Com Corp.#, 10.25%, due 11/1/01.. 6,750,000 11,036,992
Coeur D'Alene Mines Corp.,
6.0%, due 6/10/02................. 3,000,000 2,677,500
ICN Pharmaceutical,
8.5%, due 11/15/99................ 5,000,000 5,577,800
Waban Inc., 6.5%, due 7/1/02....... 3,000,000 2,797,500
--------------
22,089,792
--------------
Oil & Gas --
Apache Corp.#, 6%, due 1/15/02..... 5,000,000 5,381,350
--------------
Pharmaceuticals --
Ciba-Geigy AG#,
6.25%, due 3/15/16................ 3,000,000 3,015,000
--------------
</TABLE>
See notes to financial statements.
19
<PAGE> 62
GROWTH AND INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Issuer Amount Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
Printing & Publishing --
Time Warner, Inc.,
8.75%, due 1/10/15................ $ 8,349,550 $ 8,714,843
--------------
Retailing --
Federated Department Stores,
5%, due 10/1/03................... 4,000,000 3,866,760
--------------
TOTAL CONVERTIBLE CORPORATE NOTES
AND BONDS
(Cost $97,167,708)............... 109,138,857
--------------
U.S. GOVERNMENT OBLIGATIONS -- 0.9%
U.S. Treasury Bond,
9.25%, due 02/15/16
(Cost $14,430,500)............... 12,400,000 16,399,000
--------------
TOTAL LONG-TERM INVESTMENTS
(Cost $1,387,696,657)............. 1,601,651,957
--------------
SHORT-TERM INVESTMENTS -- 12.9%
U.S. GOVERNMENT OBLIGATIONS -- 0.2%
U.S. Treasury Bill, due 11/24/95@@
(Cost $3,189,011)................ 3,200,000 3,189,011
--------------
U.S. GOVERNMENT AGENCY SPONSORED
OBLIGATIONS -- 1.9%
Federal National Mortgage
Association, 5.5%, due 11/29/95
(Cost $34,850,005)............... 35,000,000 34,850,005
--------------
<CAPTION>
Principal
Issuer Amount Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
COMMERCIAL PAPER -- 10.8%
Chemicals --
duPont (El) deNemours,
5.71%, due 11/2/95............... $ 35,000,000 $ 34,994,449
--------------
Financial Services --
Federal Home Loan Bank,
5.64%, due 11/2/95................ 20,000,000 19,996,867
Household Finance Corp.,
5.8%, due 11/1/95 ................ 41,042,000 41,042,000
JP Morgan, 5.72%, due 11/9/95...... 35,000,000 34,955,511
Receivables Capital Corp.#,
5.75%, due 11/15/95............... 35,000,000 34,921,736
Svenska Handelsbanken,
5.75%, due 11/3/95................ 35,000,000 34,988,819
--------------
165,904,933
--------------
TOTAL COMMERCIAL PAPER
(Cost $200,899,382).............. 200,899,382
--------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $238,938,398).............. 238,938,398
--------------
TOTAL INVESTMENTS --
(COST $1,626,635,055)............ 99.3% $1,840,590,355
==============
</TABLE>
- ---------------
@ = Rate shown is the rate in effect at 10/31/95.
* = Non income producing security.
# = Security may only be sold to qualified institutional
investors.
@@ = This security is pledged to cover financial futures
contracts.
PURCHASED INDEX FUTURES OUTSTANDING
<TABLE>
<CAPTION>
Expiration Number of Nominal Value Unrealized
Description (A) Date Contracts at 10/31/95 Appreciation
- ----------------------------------------------------------- ----------- ------------ -------------- ------------
<S> <C> <C> <C> <C>
S & P 500 Futures.......................................... Dec 95 300 $ 87,577,500 $1,362,579
</TABLE>
- ---------------
(A) = One contract equals 500 shares.
See notes to financial statements.
20
<PAGE> 63
CAPITAL GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 88.6%
COMMON STOCK -- 86.3%
Agricultural Products/
Services -- 5.0%
AGCO Corp. ........................ 435,000 $ 19,466,250
Agrium, Inc. ...................... 60,000 2,460,000
Case Corp. ........................ 153,500 5,852,188
IMC Global, Inc. .................. 100,000 7,000,000
Mississippi Chemical............... 200,000 4,825,000
Terra Industries, Inc. ............ 500,000 6,312,500
Vigoro Corp. ...................... 110,000 4,771,250
------------
50,687,188
------------
Automotive -- 2.0%
Echlin, Inc. ...................... 115,000 4,111,250
Lear Seating Corp. ................ 160,000 4,440,000
Magna International, Inc. Class
A................................. 100,000 4,325,000
Masland Corp. ..................... 350,000 4,900,000
Strattec Security Corp. ........... 20,000 335,000
Titan Wheel International, Inc. ... 127,500 1,848,750
------------
19,960,000
------------
Banking -- 4.4%
BayBanks, Inc. .................... 175,000 14,175,000
Dime Bancorp, Inc.*................ 200,000 2,125,000
Midlantic Corp., Inc. ............. 50,000 2,650,000
Standard Federal Bancorporation.... 450,000 15,975,000
Zions Bancorporation............... 150,000 10,387,500
------------
45,312,500
------------
Broadcasting -- 0.2%
People's Choice TV Corp.*.......... 87,740 1,820,605
------------
Business Services -- 0.7%
Equifax, Inc. ..................... 125,000 4,875,000
PHH Corp. ......................... 50,000 2,187,500
------------
7,062,500
------------
Chemicals -- 0.9%
Hanna (M.A.) Co. .................. 150,000 3,843,750
Material Sciences Corp.*........... 200,000 3,325,000
The Geon Company................... 100,000 2,487,500
------------
9,656,250
------------
Computer Software -- 3.9%
American Management Systems,
Inc.*............................. 150,000 4,331,250
BMC Software, Inc. ................ 125,000 4,453,125
Computervision Corp.*.............. 300,000 3,525,000
FileNet Corp.*..................... 190,000 8,621,250
Reynolds & Reynolds, Inc., Class
A................................. 500,000 17,812,500
Symantec Corp.*.................... 50,000 1,215,625
------------
39,958,750
------------
Computers/Computer Hardware -- 4.5%
Comdisco, Inc. .................... 350,000 10,675,000
Cornerstone Imaging, Inc.*......... 60,000 1,350,000
Inference Corp., Class A........... 41,650 505,006
Micros Systems, Inc.*.............. 100,000 3,725,000
Read-Rite Corp. ................... 250,000 8,718,750
SCI Systems, Inc.*................. 400,000 14,050,000
Solectron Corp.*................... 175,000 7,043,750
------------
46,067,506
------------
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
Construction Materials -- 1.7%
Manville Corp.*.................... 500,000 $ 5,812,500
Texas Industries Inc. ............. 100,000 5,262,500
USG Corp. ......................... 200,000 5,825,000
------------
16,900,000
------------
Consumer Products -- 4.7%
Black & Decker Corp. .............. 250,000 8,468,750
Danaher Corp. ..................... 300,000 9,300,000
First Brands Corp. ................ 100,000 4,575,000
Fleetwood Enterprises, Inc. ....... 250,000 5,125,000
Lancaster Colony Corp. ............ 125,000 4,156,250
Leggett & Platt Inc. .............. 200,000 4,800,000
Toro Co. .......................... 400,000 11,550,000
------------
47,975,000
------------
Diversified -- 0.4%
Albany International Corp., Class
A................................. 200,000 4,150,000
------------
Electronics/Electrical
Equipment -- 7.3%
Adaptec, Inc. ..................... 150,000 6,675,000
ADT ltd. .......................... 400,000 5,600,000
AVX Corp. ......................... 125,000 3,890,625
Belden, Inc. ...................... 116,000 2,798,500
Harman International Industries,
Inc. ............................. 105,000 4,843,125
Integrated Device Technology,
Inc.*............................. 275,000 5,225,000
ITI Technologies, Inc.*............ 40,000 1,010,000
Lam Research Corp.*................ 90,000 5,478,750
Linear Technology Corp. ........... 75,000 3,281,250
LTX Corp.* ........................ 200,000 2,475,000
Mentor Graphics Corp. ............. 250,000 5,250,000
Microchip Technology, Inc.*........ 125,000 4,960,937
Tektronix Inc. .................... 100,000 5,925,000
Teradyne Inc.*..................... 130,000 4,338,750
Vishay Intertechnology, Inc. ...... 50,600 1,783,650
Watkins-Johnson.................... 100,000 4,812,500
Xilinx, Inc.*...................... 125,000 5,750,000
------------
74,098,087
------------
Electronics Distributors -- 1.5%
Arrow Electronics, Inc.*........... 137,800 6,993,350
Marshall Industries*............... 225,000 7,931,250
------------
14,924,600
------------
Entertainment -- 1.1%
Bally Entertainment Corp.*......... 500,000 5,500,000
Integrity Music, Inc., Class A*.... 200,000 475,000
Mirage Resorts, Inc.* ............. 175,000 5,731,250
------------
11,706,250
------------
Financial Services -- 3.3%
Advanta Corp., Class A............. 200,000 7,750,000
DST Systems, Inc.*................. 174,500 3,664,500
Finova Group, Inc. ................ 100,000 4,525,000
Green Tree Financial Corp. ........ 450,000 11,981,250
National Auto Credit, Inc.*........ 300,000 4,875,000
SEI Corp. ......................... 62,200 1,321,750
------------
34,117,500
------------
Food/Beverage Products -- 1.6%
IBP, Inc. ......................... 275,000 16,465,625
------------
</TABLE>
See notes to financial statements.
21
<PAGE> 64
CAPITAL GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
Health Care -- 4.5%
Apria Healthcare Group, Inc.*...... 60,000 $ 1,297,500
Beckman Instruments, Inc. ......... 200,000 6,625,000
Beverly Enterprises................ 350,000 4,112,500
HealthCare COMPARE*................ 175,000 6,475,000
Horizon/CMS Healthcare Corp. ...... 250,000 5,062,500
OrNda Healthcorp*.................. 500,000 8,812,500
Sybron International Corp.*........ 130,000 5,525,000
Universal Health Services, Inc.,
Class B*.......................... 200,000 7,500,000
------------
45,410,000
------------
Home Building Construction -- 0.6%
Oakwood Homes Corp. ............... 150,000 5,625,000
------------
Insurance -- 6.1%
ACE, Ltd. #........................ 170,000 5,780,000
American Re Corp. ................. 150,000 5,737,500
Mid Ocean, Ltd.*................... 175,000 6,190,625
PartnerRe Holdings, Ltd. .......... 50,000 1,331,250
PXRE Corp. ........................ 103,500 2,639,250
Reliance Group Holdings, Inc. ..... 300,000 2,212,500
Reliastar Financial Corp. ......... 325,000 13,568,750
SunAmerica, Inc. .................. 175,000 10,893,750
TIG Holdings Inc. ................. 200,000 5,075,000
Transatlantic Holdings, Inc. ...... 80,000 5,390,000
USF&G Corp. ....................... 200,000 3,350,000
------------
62,168,625
------------
Machinery & Engineering
Equipment -- 0.7%
Blount Inc., Class A............... 75,000 3,253,125
Precision Castparts Corp. ......... 100,000 3,575,000
------------
6,828,125
------------
Manufacturing -- 5.7%
Duriron, Inc. ..................... 100,000 2,675,000
Elsag Bailey Process Automation
N.V.* ADR......................... 283,000 7,711,750
Furon Co. ......................... 125,000 1,937,500
JLG Industries, Inc. .............. 200,000 4,700,000
Johnson Controls................... 85,000 4,951,250
Kennametal Inc. ................... 385,000 11,983,125
Mark IV Industries................. 200,000 3,900,000
Modine Manufacturing Co. .......... 350,000 9,625,000
NACCO Industries, Inc. Class A..... 100,000 5,725,000
Varity Corp.*...................... 125,000 4,531,250
------------
57,739,875
------------
Metals/Mining -- 0.8%
Amcast Industrial Corp. ........... 200,000 3,400,000
Cleveland-Cliffs, Inc. ............ 75,000 2,803,125
Commonwealth Aluminum Corp. ....... 125,000 2,015,625
------------
8,218,750
------------
Oil & Gas -- 4.2%
Diamond Shamrock #................. 200,000 5,150,000
Noble Drilling Corp. .............. 27,097 189,681
Panhandle Eastern Corp. ........... 200,000 5,050,000
Smith International*............... 700,000 11,200,000
Total Petroleum of North America... 500,000 5,062,500
Triton Energy Corp. ............... 110,000 5,128,750
Union Texas Petroleum Holdings..... 225,000 4,050,000
Weatherford Enterra, Inc. ......... 300,000 7,237,500
------------
43,068,431
------------
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
Paper/Forest Products -- 1.3%
Boise Cascade Corp. ............... 125,000 $ 4,531,250
Bowater, Inc. ..................... 100,000 4,425,000
Rayonier, Inc. .................... 125,000 4,687,500
------------
13,643,750
------------
Printing & Publishing -- 0.4%
Pulitzer Publishing................ 100,000 4,525,000
------------
Real Estate Investment
Trust -- 2.8%
Avalon Properties, Inc. ........... 200,000 3,900,000
Bay Apartment Communities, Inc. ... 150,000 3,093,750
Developers Diversified Realty...... 50,000 1,425,000
Evans Withycombe Residential,
Inc. ............................. 150,000 2,831,250
Home Properties of New York,
Inc. ............................. 222,400 3,753,000
Liberty Property Trust............. 200,000 4,050,000
Oasis Residential, Inc. ........... 200,000 4,350,000
ROC Communities, Inc. ............. 100,000 2,250,000
Storage Trust Realty............... 100,000 1,962,500
Walden Residential Properties,
Inc.,............................. 65,000 1,194,375
------------
28,809,875
------------
Retailing -- 6.6%
Baker (J.), Inc. .................. 150,000 862,500
Big B Inc. ........................ 212,000 3,127,000
Casey's General Stores, Inc. ...... 225,000 5,175,000
Circuit City Stores, Inc. ......... 200,000 6,675,000
Dillard Department Stores, Inc.,
Class A........................... 350,000 9,493,750
Eckerd Corp.*...................... 300,000 11,887,500
Ethan Allen Interiors, Inc.*....... 471,000 9,302,250
General Nutrition Companies,
Inc. ............................. 280,000 6,965,000
Kroger Co.*........................ 150,000 5,006,250
Mercantile Stores.................. 200,000 8,975,000
------------
67,469,250
------------
Shipping/Transportation -- 2.7%
Consolidated Freightways........... 200,000 4,650,000
GATX Corp. ........................ 200,000 9,500,000
Pittston Services Group............ 250,000 6,875,000
XTRA Corp. ........................ 100,000 4,387,500
Landstar System, Inc.*............. 65,000 1,706,250
------------
27,118,750
------------
Steel -- 0.5%
LTV Corp.*......................... 400,000 5,600,000
------------
Telecommunications -- 1.3%
Aspect Telecommunications Corp.*... 350,000 12,031,250
Mobilemedia Corp. ................. 65,000 1,706,250
------------
13,737,500
------------
Textile Mill Products -- 1.0%
Springs Industries, Inc., Class
A................................. 125,000 5,359,375
Warnaco Group, Inc., Class A....... 190,000 4,417,500
------------
9,776,875
------------
Utilities -- 3.9%
CINergy Corp. ..................... 200,000 5,675,000
CMS Energy Corp. .................. 400,000 11,050,000
DQE, Inc. ......................... 300,000 8,250,000
Pinnacle West Capital Corp. ....... 300,000 8,250,000
Public Service Co. of Colorado..... 200,000 6,825,000
------------
40,050,000
------------
</TABLE>
See notes to financial statements.
22
<PAGE> 65
CAPITAL GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
TOTAL COMMON STOCK
(Cost $775,067,805)............... $ 880,652,167
------------
PREFERRED STOCK -- 0.1%
Electronics/Electrical Equipment --
Comptronix, Ser. A, 6%............. 3,758 6,577
------------
Telecommunications --
LCI International, Inc., 5%........ 10,000 478,750
------------
TOTAL PREFERRED STOCK
(Cost $250,000)................... 485,327
------------
WARRANTS -- 0.1%
Oil & Gas --
BJ Services Co., Expires 1/15/15,
strike price, $30.00
(Cost $600)....................... 60,000 270,000
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
------------
<S> <C> <C>
CONVERTIBLE CORPORATE BONDS &
NOTES -- 1.0%
Computer Software --
Softkey International Inc.#,
5.5%, due 11/1/00................. $ 5,000,000 4,235,200
------------
Computers/Computer Hardware --
Quantum Corp.#,
6.375%, due 4/1/00................ 250,000 265,000
------------
Health Care --
ICN Pharmaceutical,
8.5%, due 11/15/99................ 3,000,000 3,346,680
Surgical Laser Technology, Inc.,
8.00%, due 7/30/99................ 3,033 1,820
Shuler Homes,
6.5%, due 1/15/03................. 300,000 252,375
------------
3,600,875
------------
Restaurants/Food Services --
Flagstar Companies, Inc.,
10%, due 11/1/14.................. 100,000 61,167
------------
Tire & Rubber --
Titan Wheel International,
4.75%, due 12/1/00................ 1,500,000 1,800,000
------------
<CAPTION>
Principal
Issuer Amount Value
- ----------------------------------- ------------ --------------
<S> <C> <C>
TOTAL CONVERTIBLE CORPORATE BONDS &
NOTES
(Cost $10,140,800)................ $ 9,962,242
------------
VARIABLE RATE NOTES -- 1.1%
Goldman Sachs #,
5.85%, due 7/1/96@
(Cost $12,000,000)............... $ 12,000,000 11,889,720
------------
TOTAL LONG-TERM INVESTMENTS
(Cost $797,459,205)............... 903,259,456
------------
SHORT-TERM INVESTMENTS -- 10.4%
U.S. GOVERNMENT AGENCY
OBLIGATIONS -- 3.9%
Federal Home Loan Bank, Discount
Note, due 12/04/95................ 20,000,000 19,897,517
Federal National Mortgage
Association, Discount Note,
due 11/15/95...................... 20,000,000 19,956,133
------------
TOTAL U.S. GOVERNMENT AGENCY
OBLIGATIONS
(Cost $39,853,650)................ 39,853,650
------------
COMMERCIAL PAPER -- 6.5%
Household Finance Corp.,
5.80%, due 11/01/95.............. 26,325,000 26,325,000
Merrill Lynch, 5.73%, due
11/10/95.......................... 20,000,000 19,971,350
Receivables Capital Corp.,
5.75%, due 11/15/95#.............. 20,000,000 19,955,278
------------
TOTAL COMMERCIAL PAPER
(Cost $66,251,628)................ 66,251,628
------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $106,105,278).............. 106,105,278
------------
TOTAL INVESTMENTS --
(COST $903,564,483)............... 99.0% $1,009,364,734
============
</TABLE>
- ---------------
* = Non-income producing security.
Security may only be sold to qualified
# = institutional investors.
@ = Rate shown is the rate in effect at 10/31/95
See notes to financial statements.
23
<PAGE> 66
INTERNATIONAL EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Issuer Shares (USD)
- --------------------------------------- --------- -------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 93.4%
COMMON STOCK -- 93.2%
ARGENTINA -- 1.1%
Banking--
Banco Frances del Rio de la Plata
S.A., ADR........................... 13,500 $ 295,313
Oil & Gas--
YPF Sociedad, ADR..................... 5,000 85,625
-------------
380,938
-------------
CHILE -- 0.7%
Packaging --
Cristalerias De Chile S.A., ADR....... 10,000 242,500
-------------
FINLAND -- 1.7%
Electronics/Electrical Equipment --
Nokia AB, Ser. A...................... 5,000 286,182
Nokia AB, Ser. K Shares............... 1,800 105,145
Paper/Forest Products --
Kymmene OY............................ 7,485 204,511
-------------
595,838
-------------
FRANCE -- 5.8%
Automotive --
Peugeot S.A.*......................... 1,000 130,439
Broadcasting & Publishing --
TV Francaise.......................... 1,055 109,097
Consumer Products --
SEITA................................. 7,050 245,418
Financial Services --
Cetelem Group*........................ 1,950 311,457
Leisure --
Salomon S.A........................... 433 250,215
Oil & Gas --
Total S.A., Ser. B.................... 3,200 198,022
Pharmaceuticals --
Roussel-Uclaf......................... 1,500 246,340
Retailing --
Docks De France....................... 3,318 505,496
-------------
1,996,484
-------------
GERMANY -- 6.4%
Banking --
Commerzbank AG........................ 1,062 245,922
Electronics/Electrical Equipment --
Siemens AG............................ 313 164,181
Machinery & Equipment --
Mannesmann AG......................... 540 177,819
Pharmaceuticals --
Altana Industrie-Aktien Und Anlagen
AG.................................. 800 465,404
Retailing --
Asko Deutsche Kaufhaus AG............. 790 410,455
Karstadt AG........................... 560 244,387
Utilities --
VEBA AG............................... 11,700 480,573
-------------
2,188,741
-------------
<CAPTION>
Value
Issuer Shares (USD)
- --------------------------------------- --------- -------------
<S> <C> <C>
HONG KONG -- 3.0%
Banking --
HSBC Holdings Plc..................... 42,024 $ 621,215
Diversified --
Jardine Matheson Holdings............. 70,000 427,000
-------------
1,048,215
-------------
INDONESIA -- 1.0%
Telecommunications --
PT Indosat, ADR *..................... 10,000 331,250
-------------
IRELAND -- 1.9%
Banking --
Bank of Ireland....................... 83,000 551,102
Insurance --
Irish Life Plc........................ 28,000 103,138
-------------
654,240
-------------
ITALY -- 1.8%
Telecommunications --
Telecom Italia Mobile................. 287,374 483,457
Stet D Risp Port, Non-Convertible
Savings Shares...................... 60,947 132,975
-------------
616,432
-------------
JAPAN -- 30.0%
Automotive --
Hitachi Zosen Corp.,.................. 45,000 221,380
Nissan Motor Co, Ltd.................. 85,000 573,622
Banking --
Industrial Bank of Japan.............. 13,000 354,736
Engineering Services --
JGC Corp. ............................ 26,000 282,263
Electronics/Electrical Equipment --
Advantest Corp........................ 16,000 907,624
Fanuc Co.............................. 21,000 909,873
Keyence Corp.......................... 8,000 985,867
Kyocera Corp.......................... 15,000 1,229,400
Mitsubishi Electric Corp.............. 70,000 523,057
Murata Manufacturing Co., Ltd......... 5,000 171,646
NEC Corp.............................. 51,000 673,382
Ushio Inc............................. 51,000 578,610
Financial Services --
Credit Saison Co. Ltd................. 5,000 105,140
New Japan Securities.................. 72,000 338,012
Machinery & Engineering Equipment --
Komori Corp........................... 21,000 497,041
Mitsubishi Heavy Industries Ltd....... 75,000 578,757
Shin Nippon Machinery................. 7,000 52,716
Retailing --
Ito-Yokado Co. Ltd.................... 12,000 656,071
Steel --
Nippon Steel Company.................. 114,000 377,974
Telecommunications --
Tamura Electric Works................. 20,000 305,149
-------------
10,322,320
-------------
</TABLE>
See notes to financial statements.
24
<PAGE> 67
INTERNATIONAL EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Issuer Shares (USD)
- --------------------------------------- --------- -------------
<S> <C> <C>
MALAYSIA -- 2.8%
Construction Materials --
Sungei Way Holdings Bhd............... 84,000 $ 282,645
Packaging --
Kian Joo Can Factory Bhd.............. 169,500 667,060
-------------
949,705
-------------
NETHERLANDS -- 5.1%
Appliances & Household Durables --
Philips Gloeilampen................... 4,000 154,577
Broadcasting & Publishing --
Verenigde Nederlandse Uitgevbedri
Verigd Bezit (VNU).................. 2,843 398,398
Financial Services --
International Nederlanden Groep NV.... 8,315 495,687
Food/Beverage Products --
Heineken NV........................... 1,927 341,818
Telecommunications --
Royal PTT Nederland NV................ 10,010 351,951
-------------
1,742,431
-------------
SPAIN -- 3.1%
Banking --
Banco Santander....................... 13,545 590,627
Steel --
Acerinox SA -- New.................... 294 30,989
Utilities --
Iberdrola S.A......................... 60,787 458,375
-------------
1,079,991
-------------
SWEDEN -- 1.5%
Automotive --
Autoliv AB............................ 4,875 279,660
Machinery & Engineering Equipment --
Svedala Industri AB-Free.............. 10,000 253,706
-------------
533,366
-------------
SWITZERLAND -- 5.6%
Pharmaceuticals --
Ciba-Geigy AG (Bearer Shares)......... 300 258,962
Ciba-Geigy AG (Registered Shares)..... 390 337,682
Roche Holding AG...................... 102 741,214
Sandoz AG (Registered Shares)......... 540 445,680
Sandoz AG (Bearer Shares)............. 157 130,684
-------------
1,914,222
-------------
THAILAND -- 6.7%
Banking --
Bangkok Metropolitan Bank (Foreign)... 480,000 515,001
Krung Thai Bank Ltd. (Foreign)........ 149,000 592,092
Financial Services --
Finance One Co., Ltd. (Foreign)....... 79,000 442,639
Steel --
Sahaviriya Steel Industry (Foreign)... 180,000 418,438
Telecommunications --
Loxley Company Ltd. (Foreign)......... 16,000 321,717
-------------
2,289,887
-------------
UNITED KINGDOM -- 15.0%
Aerospace --
British Aerospace Plc................. 7,629 85,510
Airlines --
British Airways Plc................... 28,864 207,621
<CAPTION>
Value
Issuer Shares (USD)
- --------------------------------------- --------- -------------
<S> <C> <C>
Automotive --
Cowie Group Plc....................... 35,218 $ 165,915
Banking --
Abbey National Plc.................... 12,990 109,970
Broadcasting & Publishing --
General Cable Plc..................... 86,000 256,280
Computers/Computer Hardware --
Amstrad Plc........................... 42,044 193,752
Consumer Products --
B.A.T. Industries Plc................. 31,296 256,780
Electronics/Electrical Equipment --
General Electric Company Plc.......... 18,783 93,239
Hotels/Other Lodging --
Greenalls Group Plc................... 45,122 345,254
Industrial Components --
McKechnie Group Plc................... 27,822 191,769
Insurance --
General Accident Plc.................. 26,898 274,912
Lloyds Abbey Life Group............... 20,450 147,907
Royal Insurance Holdings Plc.......... 37,493 231,460
Machinery & Equipment --
Powerscreen International Plc......... 25,754 156,751
Senior Engineering Group Plc.......... 101,176 158,350
Vickers Plc........................... 22,933 90,999
Packaging --
David S. Smith (Holdings) Plc......... 18,961 172,659
Pharmaceuticals --
Glaxo Wellcome Plc.................... 14,899 201,032
Restaurants/Food Services --
Compass Group Plc..................... 13,556 92,152
Retailing --
Tesco Plc............................. 67,925 322,148
Shipping/Transportation --
Ocean Group Plc....................... 18,680 108,675
Telecommunications --
British Telecommunications Plc........ 14,512 86,377
Textile Mill Products and Apparel --
Coats Viyella Plc..................... 49,341 145,866
Dewhirst Group Plc.................... 36,021 106,488
Utilities --
Anglian Water Plc..................... 31,064 276,239
National Power Plc.................... 85,268 272,296
South West Water Plc.................. 23,885 189,177
Thames Water Plc...................... 24,205 201,469
-------------
5,141,047
-------------
TOTAL COMMON STOCK
(Cost $29,074,450).................... 32,027,607
-------------
WARRANTS -- 0.2%
MALAYSIA --
Construction Materials --
Sungei Way Holdings Bhd., expires
06/29/99............................ 12,000 14,168
Packaging --
Kian Joo Can Factory Bhd, expires
05/22/99............................ 23,000 38,016
-------------
TOTAL WARRANTS
(Cost $13,456)........................ $ 52,184
-------------
</TABLE>
See notes to financial statements.
25
<PAGE> 68
INTERNATIONAL EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount
(in local Value
currency) (USD)
--------- -------------
<S> <C> <C>
CORPORATE BONDS AND NOTES -- .0%
FRANCE --
Banking --
Societe Generale (FRF),
3.50%, due 01/01/00
(Cost $2,844)....................... 15,840 $ 3,573
-------------
TOTAL LONG-TERM INVESTMENTS
(Cost $29,090,750).................... 32,083,364
-------------
SHORT-TERM INVESTMENTS -- 0.1%
MONEY MARKET DEPOSIT
ACCOUNT -- 0.1%
<CAPTION>
Principal Value
Issuer Amount (USD)
- --------------------------------------- --------- -------------
<S> <C> <C>
UNITED STATES --
Chase Manhattan Bank @ 4.0%, due
11/01/95
(Cost $51,623)..................... $ 51,623 $ 51,623
-------------
TOTAL INVESTMENTS --
(COST $29,142,373)................... 93.5% $ 32,134,987
=============
</TABLE>
- ---------------
* = Non income producing security.
FRF = French Francs
USD = United States Dollars
ADR = American Depositary Receipts
@ = Affiliated Issuer
See notes to financial statements.
26
<PAGE> 69
STATEMENT OF ASSETS AND LIABILITIES October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Growth & International
Income Capital Growth Equity
Portfolio Portfolio Portfolio
-------------- -------------- ------------
<S> <C> <C> <C>
ASSETS:
Investment securities, at value (Note 1).............. $1,840,590,355 $1,009,364,734 $ 32,134,987
Cash.................................................. 152 152,545 --
Foreign Currency (Cost $761,993)...................... -- -- 757,663
Receivable for open forward currency contracts........ -- -- 14,938
Receivable for investment securities sold............. 10,829,363 19,865,046 1,473,752
Dividends and interest receivable..................... 4,017,526 776,763 64,928
Receivable from VBDS (Note 2)......................... -- -- 7,902
Unamortized organization costs (Note 1)............... 23,996 23,996 24,923
Other assets.......................................... -- 26,895 472
-------------- -------------- -----------
Total Assets........................................ 1,855,461,392 1,030,209,979 34,479,565
-------------- -------------- -----------
LIABILITIES:
Payable to Custodian.................................. -- -- 43,628
Payable for investment securities purchased........... -- 10,213,300 --
Accrued liabilities:
Advisory fees (Note 2).............................. 638,362 348,151 --
Administration fees (Note 2)........................ 79,795 43,520 --
Organization costs payable.......................... 40,000 40,000 --
Other accrued expenses.............................. 110,092 139,289 61,609
Variation margin payable on futures contracts......... 427,500 -- --
Payable for open forward currency contracts........... -- -- 5,002
-------------- -------------- -----------
Total Liabilities................................... 1,295,749 10,784,260 110,239
-------------- -------------- -----------
NET ASSETS APPLICABLE TO INVESTORS' BENEFICIAL
INTERESTS............................................. $1,854,165,643 $1,019,425,719 $ 34,369,326
============== ============== ===========
Cost of Investments..................................... $1,626,635,055 $ 903,564,483 $ 29,142,373
============== ============== ===========
</TABLE>
See notes to financial statements.
27
<PAGE> 70
STATEMENT OF OPERATIONS
For the Year Ended October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
International
Growth & Income Capital Growth Equity
Portfolio Portfolio Portfolio
---------------- -------------- -------------
<S> <C> <C> <C>
INVESTMENT INCOME (Note 1):
Interest.............................................. $ 26,372,528 $ 7,285,147 $ 119,763
Dividends............................................. 30,917,914 11,074,210 725,167
Foreign taxes withheld................................ (121,509) (3,018) (117,243)
----------- ----------- -----------
Total investment income........................... 57,168,933 18,356,339 727,687
----------- ----------- -----------
EXPENSES:
Advisory fees (Note 2)................................ 6,815,197 3,563,194 431,019
Administration fees (Note 2).......................... 851,900 445,399 21,632
Accounting fees....................................... 83,003 81,003 74,151
Custodian fees (Note 2)............................... 134,266 103,147 64,251
Professional fees..................................... 70,000 68,769 64,275
Trustee fees.......................................... 8,000 8,001 2,001
Miscellaneous expense................................. 37,503 44,465 24,999
Amortization of organization costs (Note 1)........... 7,990 7,990 11,516
----------- ----------- -----------
Total expenses.................................... 8,007,859 4,321,968 693,844
----------- ----------- -----------
Less fees waived by the Advisor and Administrator (Note
2).................................................... -- -- 297,934
----------- ----------- -----------
Net Expenses........................................ 8,007,859 4,321,968 395,910
----------- ----------- -----------
Net investment income................................. 49,161,074 14,034,371 331,777
----------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments........................................... 79,876,783 38,313,408 (2,936,445)
Futures transactions.................................. 15,400,050 -- --
Foreign currency transactions......................... 56 -- 152,966
----------- ----------- -----------
Net realized gain (loss)............................ 95,276,889 38,313,408 (2,783,479)
----------- ----------- -----------
Change in net unrealized appreciation (depreciation) on:
Investments........................................... 153,073,852 83,513,979 1,410,173
Futures contracts..................................... 1,767,626 -- --
Foreign currency contracts and foreign currency
translations........................................ -- -- (23,821)
----------- ----------- -----------
Change in net unrealized appreciation
(depreciation)................................. 154,841,478 83,513,979 1,386,352
----------- ----------- -----------
Net realized and unrealized gain (loss)................. 250,118,367 121,827,387 (1,397,127)
----------- ----------- -----------
Net increase (decrease) in net assets resulting from
operations............................................ $299,279,441 $ 135,861,758 ($ 1,065,350)
=========== =========== ===========
</TABLE>
See notes to financial statements.
28
<PAGE> 71
STATEMENT OF CHANGES IN NET ASSETS For the Periods Indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Growth & Income Capital Growth International Equity
Portfolio Portfolio Portfolio
------------------------------- ------------------------------- -----------------------------
Year 11/29/93* Year 11/29/93* Year Year
ended through ended through ended ended
10/31/95 10/31/94 10/31/95 10/31/94 10/31/95 10/31/94
-------------- -------------- -------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income......... $ 49,161,074 $ 30,288,120 $ 14,034,371 $ 5,544,732 $ 331,777 $ 228,285
Net realized gain (loss) on
investments and foreign
currency.................... 95,276,889 (4,034,603) 38,313,408 14,244,098 (2,783,479) 914,084
Change in net unrealized
appreciation on investments,
futures and foreign currency
translations................ 154,841,478 9,175,252 83,513,979 4,750,804 1,386,352 397,695
-------------- -------------- -------------- -------------- ------------- -------------
Increase (decrease) in net
assets resulting from
operations................ 299,279,441 35,428,769 135,861,758 24,539,634 (1,065,350) 1,540,064
-------------- -------------- -------------- -------------- ------------- -------------
TRANSACTIONS IN INVESTORS'
BENEFICIAL INTERESTS:
Contributions................. 511,820,403 1,858,407,526 1,403,653,138 1,071,735,107 27,092,056 61,709,664
Withdrawals................... (542,453,501) (308,316,995) (1,217,251,104) (399,112,814) (47,239,948) (30,833,170)
-------------- -------------- -------------- -------------- ------------- -------------
Net increase (decrease) from
transactions in investors'
beneficial interests.......... (30,633,098) 1,550,090,531 186,402,034 672,622,293 (20,147,892) 30,876,494
-------------- -------------- -------------- -------------- ------------- -------------
Net increase (decrease) in
net assets................ 268,646,343 1,585,519,300 322,263,792 697,161,927 (21,213,242) 32,416,558
NET ASSETS:
Beginning of period........... 1,585,519,300 -- 697,161,927 -- 55,582,568 23,166,010
-------------- -------------- -------------- -------------- ------------- -------------
End of period................. $1,854,165,643 $1,585,519,300 $1,019,425,719 $ 697,161,927 $ 34,369,326 $ 55,582,568
============== ============== ============== ============== ============= =============
</TABLE>
- ---------------
* Commencement of operations.
See notes to financial statements.
29
<PAGE> 72
NOTES TO FINANCIAL STATEMENTS October 31, 1995
- --------------------------------------------------------------------------------
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES -- Growth and Income
Portfolio ("GIP"), Capital Growth Portfolio ("CGP") and International Equity
Portfolio ("IEP") (the "Portfolios") are separately registered under the
Investment Company Act of 1940, as amended, as non-diversified, open end
management investment companies organized as trusts under the laws of the State
of New York. Each declaration of trust permits the Trustees to issue beneficial
interests in the respective Portfolios. The GIP and CGP Portfolios commenced
operations on November 29, 1993 and the IEP commenced operations on December 31,
1992.
Effective October 16, 1995, the offshore partner, International Equity Fund,
withdrew its partnership interests from the International Equity Portfolio in
the form of cash. The partnership interest of the offshore fund declined from
19% at the beginning of the year to 1% at the time of transfer.
The following is a summary of significant accounting policies followed by
the Portfolios:
A. Valuation of Investments -- Equity securities, purchased options and
futures are valued at the last sale price on the exchange on which they are
primarily traded, including the NASDAQ National Market. Securities for
which sale prices are not available and other over-the-counter securities
are valued at the last quoted bid price. Bonds and other fixed income
securities (other than short-term obligations), including listed issues,
are valued on the basis of valuations furnished by a pricing service. In
making such valuations, the pricing service utilizes both dealer-supplied
valuations and electronic data processing techniques that take into account
appropriate factors such as institutional-sized trading in similar groups
of securities, yield, quality, coupon rate, maturity, type of issue,
trading characteristics and other market data, without exclusive reliance
upon quoted prices. Short-term obligations are valued at amortized cost if
acquired with fewer than 61 days to maturity, or at value based on quoted
exchange or over-the-counter prices, until the 61st day prior to maturity
and thereafter by amortizing the value on the 61st day to par at maturity.
Portfolio securities for which there are no such quotations or valuations
are valued at fair value as determined in good faith by or at the direction
of the Trustees.
B. Security Transactions and Investment Income -- Investment transactions
are accounted for on the trade date (the date the order to buy or sell is
executed). Securities gains and losses are calculated on the identified
cost basis. Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date.
C. Repurchase agreements -- It is the Trusts' policy that repurchase
agreements are fully collateralized by U.S. Treasury and Government agency
securities. All collateral is held by the Trust's custodian bank,
sub-custodian or a bank with which the custodian bank has entered into a
sub-custodian agreement or is segregated in the Federal Reserve Book Entry
System. In connection with transactions in repurchase agreements, if the
seller defaults and the value of the collateral declines, or if the seller
enters into an insolvency proceeding, realization of the collateral by the
Trust may be delayed or limited.
D. Futures contracts -- When a portfolio enters into a futures contract,
it makes an initial margin deposit in a segregated account, either in cash
or liquid securities. Thereafter, the deposit is marked to market based
upon changes in the value of the futures contract and the portfolio makes
(or receives) additional cash payments daily to the broker. Changes in the
value of the contract are recorded as unrealized appreciation/depreciation
until the contract is closed or settled.
30
<PAGE> 73
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
The Growth and Income Portfolio invested a portion of its liquid assets in
long stock index futures contracts to more fully participate in the market.
Use of futures contracts subject the Portfolio to risk of loss in excess of
amounts shown on the Statement of Assets and Liabilities, up to the amount
of the value of the contract.
The Portfolio may enter into futures contracts only on exchanges or boards
of trade. The exchange or board of trade acts as the counterparty to each
futures transaction, therefore, the Portfolio's credit risk is limited to
failure of the exchange or board of trade.
E. Foreign Currency Translations -- The books and records of the
Portfolios are maintained in U.S. dollars. Foreign currency amounts are
translated into U.S. dollars at the official exchange rates, or at the mean
of the current bid and asked prices, of such currencies against the U.S.
dollar as quoted by a major bank, on the following basis:
(a) Market value of investment securities and other assets and
liabilities: at the closing rate of exchange at the balance sheet date.
(b) Purchases and sales of investment securities, income and expenses: at
the rates of exchange prevailing on the respective dates of such
transactions.
Although the net assets of the Portfolio are presented at the foreign
exchange rates and market values at the close of the year, the Portfolio
does not isolate that portion of the results of operations arising as a
result of changes in the foreign exchange rates from the fluctuations
arising from changes in the market prices of the securities held at year
end. Similarly, the Portfolio does not isolate the effect of changes in
foreign exchange rates from the fluctuations arising from changes in the
market prices of securities sold during the year. Accordingly, realized
foreign currency gains (losses) are included in the reported net realized
losses on security transactions.
Reported realized foreign exchange gains or losses arise from disposition
of foreign currency, currency gains or losses realized between the trade
and settlement dates on securities transactions, and the difference between
the amounts of dividends, interest, and foreign withholding taxes recorded
on the Portfolios' books on the transaction date and the U.S. dollar
equivalent of the amounts actually received or paid. Unrealized foreign
exchange gains and losses arise from changes (due to the changes in the
exchange rate) in the value of foreign currency and other assets and
liabilities denominated in foreign currencies which are held at period end.
G. Forward Foreign Currency Exchange Contracts -- The portfolios may
enter into forward foreign currency contracts (obligations to purchase or
sell foreign currency in the future on a date and price fixed at the time
the contracts are entered into) to hedge the portfolio against fluctuations
in the value of its assets or liabilities due to change in the value of
foreign currencies. Each day the forward contract is open, changes in the
value of the contract are recognized as unrealized gains or losses by
"marking to market". When the forward contract is closed, or the delivery
of the currency is made or taken, the portfolio records a realized gain or
loss equal to the difference between the proceeds from (or cost of) the
closing transaction and the portfolio's basis in the contract. The
portfolios are subject to off-balance sheet risk to the extent of the value
of the contracts for purchases of currency, and in an unlimited amount for
sales of currency.
31
<PAGE> 74
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
H. Federal Income Taxes and Distributions to Investors -- The Portfolios
intend to qualify as partnerships and therefore net income and net realized
gains are taxed to the partners. The investors in the Portfolios must take
into account their proportionate share of the Portfolios' income, gains,
losses, deductions, credits and tax preference items in computing their
federal income tax liability, without regard to whether they have received
any cash distributions from the Portfolio. The Portfolios do not intend to
distribute to investors their net investment income or their net realized
gains, if any. It is intended that the Portfolios will be managed in such a
way that investors in the portfolio will be able to satisfy the
requirements of subchapter M of the Internal Revenue Code to be taxed as
regulated investment companies.
I. Organization Costs -- Organization and initial registration costs
incurred in connection with establishing each of the Portfolios have been
deferred and are being amortized on a straight-line basis over a
sixty-month period beginning with the commencement of operations of each
Portfolio.
2. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A. Investment Advisory Fees -- The Chase Manhattan Bank, N.A. ("Chase"),
a direct wholly-owned subsidiary of The Chase Manhattan Corporation, is the
Portfolios' investment adviser (the "Adviser") and custodian (the
"Custodian"). The Adviser manages the assets of the Portfolios pursuant to
an Advisory Agreement, and for such services, is paid an annual fee
computed daily and paid monthly based on an annual rate equal to .40% of
the GIP's and CGP's average daily net assets and 1.00% of the IEP's average
daily net assets. The Adviser voluntarily waived all or a portion of its
fees as outlined in Note 2.D. below.
B. Custodial Fees -- Chase, as Custodian, provides safekeeping services
for the Portfolios' securities. Compensation for such services are
presented in the Statement of Operations as custodian fees.
C. Administration Fee -- Pursuant to an Administration Agreement,
effective October 16, 1995, Chase ("the Administrator"), and prior thereto
The Chase Manhattan Trust Corporation Limited, provides certain
administration services to the Portfolios. For these services, the
Administrator, and the predecessor administrator, receives from each
Portfolio a fee computed at an annual rate equal to 0.05% of the respective
Portfolio's average daily net assets. The Administrator and its predecessor
voluntarily waived all or a portion of its fees as outlined in Note 2D
below.
D. Waivers of fees -- For the year ended October 31, 1995, the Adviser
and Administrator (including the predecessor) of IEP voluntarily waived
fees to which they were entitled of $276,302 and $21,632, respectively.
E. Other -- The Portfolios' organizational costs payable are comprised of
liabilities owed to the Funds' Distributor, Vista Broker Dealer Services
(VBDS).
On August 27, 1995, the Chase Manhattan Corporation and Chemical Banking
Corporation announced an agreement in principle to merge, which was
approved by shareholders of both corporations on December 11, 1995, subject
to the approval of regulators.
32
<PAGE> 75
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
3. INVESTMENT TRANSACTIONS
Purchases and sales of investments (excluding short-term investments) for the
year ended October 31, 1995, were as follows:
<TABLE>
<CAPTION>
GIP CGP IEP
-------------- ------------- ------------
<S> <C> <C> <C>
Purchases (excluding U.S. Government)................... $1,097,535,211 $ 855,989,009 $ 53,287,404
Sales (excluding U.S. Government)....................... 899,470,573 673,232,243 67,431,260
Purchases of U.S. Government............................ 19,583,924 -- --
Sales of U.S. Government................................ 113,064,899 -- --
</TABLE>
The portfolio turnover rates of GIP, CGP and IEP Portfolios for this period were
71%, 86% and 137%, respectively.
4. OPEN FORWARD FOREIGN CURRENCY CONTRACTS
INTERNATIONAL EQUITY PORTFOLIO
<TABLE>
<CAPTION>
Net
Unrealized
Delivery Market Gain
Value (Local Cost Settlement Value (Loss)
Sales Currency) (USD) Date (USD) (USD)
- ------------------------------------- ------------ ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C>
Italian Lira......................... 965,910,000 $600,000 11/22/95 $604,315 ($4,315)
Japanese Yen......................... 35,000,000 342,801 11/02/95 342,425 376
Japanese Yen......................... 35,000,000 342,801 11/02/95 342,425 376
Japanese Yen......................... 70,000,000 686,275 11/02/95 684,650 1,625
Japanese Yen......................... 39,000,000 381,792 11/17/95 382,479 (687)
Japanese Yen......................... 178,000,000 1,758,198 11/30/95 1,749,196 9,002
Japanese Yen......................... 103,000,000 1,015,809 11/30/95 1,012,250 3,559
----------- ----------- ----------
Total Sales.......................... $5,127,676 $5,117,740 $9,936
========== ========== =========
</TABLE>
5. FOREIGN CASH POSITIONS
INTERNATIONAL EQUITY PORTFOLIO
<TABLE>
<CAPTION>
Net Unrealized
Local Cost Market Value Gain (Loss)
Currency Value (USD) (USD) (USD)
- ------------------------------------------------ ----------- --------- ------------ --------------
<S> <C> <C> <C> <C>
Australian Dollar............................... 3,684 $ 2,788 $ 2,806 $18
German Deutsche Mark............................ 441,079 313,535 313,524 (11)
Great British Pound............................. 88,003 139,125 139,125 0
Japanese Yen.................................... 30,899,255 306,545 302,208 (4,337)
--------- ---------- -----------
$ 761,993 $757,663 ($4,330)
======== ========== ===========
</TABLE>
33
<PAGE> 76
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE TRUSTEES
AND BENEFICIAL INTEREST HOLDERS OF
GROWTH AND INCOME PORTFOLIO
CAPITAL GROWTH PORTFOLIO
INTERNATIONAL EQUITY PORTFOLIO
In our opinion, the accompanying statement of assets of liabilities, including
the portfolios of investments, and the related statements of operations and of
changes in net assets present fairly, in all material respects, the financial
position of Growth and Income Portfolio, Capital Growth Portfolio and
International Equity Portfolio (the "Portfolios") at October 31, 1995, the
results of each of their operations for the year then ended and the changes in
each of their net assets for the periods presented, in conformity with generally
accepted accounting principles. These financial statements are the
responsibility of the Portfolios' management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at October 31, 1995 by
correspondence with the custodian and brokers and the application of alternative
auditing procedures where confirmations from brokers were not received, provide
a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, NY 10036
December 15, 1995
<PAGE> 77
UNAUDITED
VISTA GROWTH AND INCOME FUND
VISTA CAPITAL GROWTH FUND
VISTA INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
Certain tax information regarding the Vista Mutual Funds is required to be
provided to shareholders based upon the Funds income and distributions for the
taxable year ended October 31, 1995. The information and distributions reported
in this letter may differ from the information and distributions taxable to the
shareholders for the calendar year ending December 31, 1995. The information
necessary to complete your income tax returns for the calendar year ending
December 31, 1995 will be received under separate cover.
FOR THE FISCAL YEAR ENDED OCTOBER 31, 1995:
<TABLE>
<CAPTION>
Dividends Eligible
Long-term Capital for the Dividends
Gain Received
Distributions Deduction (for
Paid Per Share Corporations)
----------------- ------------------
<S> <C> <C>
Growth and Income Fund............................... -- 84.06%
Capital Growth Fund.................................. $0.5320 49.67%
International Equity Fund............................ $0.1370 --
</TABLE>
<PAGE> 78
(This page intentionally left blank.)
<PAGE> 79
(This page intentionally left blank.)
<PAGE> 80
(This page intentionally left blank.)
<PAGE> 81
[VISTA LOGO]
VISTA FAMILY OF MUTUAL FUNDS
Vista offers a wide variety of professionally managed mutual funds that can
help you meet your financial goals. For a brochure and prospectus containing
more complete information on sales charges or expenses, contact your
investment representative or call 1-800-34-VISTA. Please read the prospectus
carefully before you invest or send money:
<TABLE>
<S> <C>
VISTA EQUITY FUNDS VISTA FIXED INCOME FUNDS
Growth and Income Fund U.S. Government Income Fund(2)
Capital Growth Fund Tax Free Income Fund
Small Cap Equity Fund New York Tax Free Income Fund
Equity Income Fund California Intermediate Tax Free Fund
Growth Fund of Washington(1)
VISTA MONEY MARKET FUNDS(2)
U.S. Government Money Market Fund
VISTA BALANCED FUND Treasury Plus Money Market Fund
Balanced Fund Tax Free Money Market Fund
New York Tax Free Money Market Fund
California Tax Free Money Market Fund
VISTA INTERNATIONAL FUNDS Global Money Market Fund
Global Fixed Income Fund Federal Money Market Fund
International Equity Fund Prime Money Market Fund
European Fund Select Shares of Connecticut Daily Tax Free
Japan Fund Income Fund(3)
Southeast Asian Fund Select Shares of New Jersey Daily Municipal
Income Fund(3)
</TABLE>
Vista Broker-Dealer Services, Inc. is the funds' distributor and is
unaffiliated with Chase. The Chase Manhattan Bank, N.A. is the funds'
portfolio adviser and provides other services to the funds.
(1) Washington Investment Advisors, Inc. is the fund's investment adviser.
(2) An investment in these funds is neither insured nor guaranteed by the U.S.
government, and there can be no assurance that these funds will be able to
maintain a stable Net Asset Value of $1.00 per share.
(3) Vista Select Shares of Connecticut Daily Tax Free Income Fund, Inc., and
Vista Select Shares of New Jersey Daily Municipal Income Fund, Inc., are
not part of, or affiliated with, the Vista Family of Mutual Funds. Reich &
Tang Distributors L.P. and New England Investment Companies L.P., which
are unaffiliated with Chase, are the funds' distributor and investment
adviser, respectively. National bank subsidiaries of The Chase Manhattan
Corporation do, however, perform shareholder servicing agent services for
the funds, although they perform no other services for the funds, such as
serving as investment adviser, custodian or administrator.
INVESTMENTS IN MUTUAL FUNDS ARE SUBJECT TO RISK, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL. IN ADDITION, THEY ARE NOT DEPOSITS, OBLIGATIONS OF, ENDORSED OR
GUARANTEED BY CHASE AND ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD
OR ANY OTHER GOVERNMENT AGENCY.
<PAGE> 82
[VISTA LOGO]
- --------------------------------------------------------------------------------
ANNUAL
-------------------------------------
REPORT
VISTA SERVICE CENTER
P.O. BOX 419392
KANSAS CITY, MO 64179
INVESTMENT ADVISER,
ADMINISTRATOR,
SHAREHOLDER SERVICING AGENT
AND CUSTODIAN
The Chase Manhattan Bank, N.A.
DISTRIBUTOR
Vista Broker-Dealer Services,
Inc.
TRANSFER AGENT
DST Systems, Inc.
LEGAL COUNSEL
Kramer, Levin, Naftalis, Nessen,
Kamin & Frankel
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
Vista Broker-Dealer Services,
Inc. is the funds' distributor
and is unaffiliated with Chase.
The Chase Manhattan Bank, N.A.
is the funds' adviser.
This report is submitted for the
general information of the
shareholders of the funds. It is
not authorized for distribution
to prospective investors in the
funds unless preceded or
accompanied by a prospectus. To
obtain a prospectus for any of
the Vista funds, call
1-800-34-VISTA. The prospectus
contains more complete
information, including charges
and expenses. Please read it
carefully before you invest
or send money.
For more information about these
funds or your account, simply
call your investment representative
or the Vista Service Center at
1-800-34-VISTA.
VIG-2
VISTA
GROWTH AND
INCOME
FUND
VISTA
CAPITAL
GROWTH
FUND
VISTA
INTERNATIONAL
EQUITY
FUND
FOR THE 12 MONTHS ENDED
OCTOBER 31, 1995
<PAGE> 83
-----------------
---------------------------------------------------------------
VISTA(SM) FAMILY OF MUTUAL FUNDS CHAIRMAN'S LETTER
December 12, 1995
Dear Shareholder:
We are pleased to present this Annual Report for
the U.S. Government Income Fund, Balanced Fund,
Equity Income Fund and Small Cap Equity Fund for the
fiscal year ended October 31, 1995.
U.S. MARKETS ROAR TO LIFE IN 1995
The U.S. financial markets roared to life in
1995 as investors correctly anticipated that the
economy would undergo a "soft landing" on the heels
of the Fed's rate hikes in 1994. All in all, it was
an outstanding year for U.S. equity investors -- one
of the best of the past century. Bond investors also
fared well, with the yield on 30-year Treasury bonds
dropping from 7.96% to 6.32% over the 12-month
period, sending the value of bonds soaring.
STRONG STOCK AND BOND SELECTIONS BOOST INVESTMENT
RETURNS
The Vista funds performed well during the period
under review -- a result of both the positive
economic environment for the U.S. financial markets
and timely stock and bond selection decisions by the
fund managers. Given the sizeable gains in the U.S.
stock and bond markets during the past year, we are
cautiously optimistic about these markets in the
months ahead.
As always, we recommend that investors take a
long-term, disciplined approach to the markets. By
leaving your money invested for the long
term -- five years or more -- you are better able to
ride out bumpy periods.
We appreciate your confidence in Vista. If you
have any questions about your Fund or the
information included in this report, please call us
at 1-800-34-VISTA.
We look forward to hearing from you.
Sincerely,
/s/ FERGUS REID
----------------
Fergus Reid
Chairman
INVESTMENTS IN MUTUAL FUNDS ARE SUBJECT TO RISK,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. IN
ADDITION, THEY ARE NOT DEPOSITS, OBLIGATIONS OF,
ENDORSED OR GUARANTEED BY CHASE, AND ARE NOT INSURED
BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENT AGENCY.
- -------------------------------------
CONTENTS
CHAIRMAN'S LETTER 1
FUND COMMENTARIES 2-5
PORTFOLIO OF INVESTMENTS 6-15
FINANCIAL STATEMENTS 16-18
NOTES TO FINANCIAL
STATEMENTS 19-24
PER SHARE DATA 25-26
1
<PAGE> 84
---------------------------------------------------------------
FUND COMMENTARY
VISTA U.S. GOVERNMENT INCOME FUND
Fluctuations in short-term interest rates created a good
buying opportunity for the U.S. Government Income Fund for
the fiscal year ended October 31, 1995. Overall, your Fund
posted a strong total return of 14.59% (A shares, without
sales charge).
During the first half of the period, from October 31,
1994 through April 30, 1995, the Fund was affected by the
Federal Reserve's decision to increase short-term interest
rates in an effort to stem higher inflation. As a result,
yields on Treasury bills and other short-term bonds rose,
causing bond prices to decline. The higher interest rates,
however, began to negatively affect the economic recovery.
Then, late in the year and into early 1995, interest rates
-- and bond yields -- began to turn lower as fears of an
overheating U.S. economy and of renewed inflation eased.
Beginning in May 1995, the U.S. bond market began to
rally as investors became convinced of an economic slowdown
and scrambled to invest in the bond market; the general
view was that the Fed would ease rates, thereby sending bond
values higher. In July, the Fed cut short-term interest
rates, which immediately sent bond prices higher; however,
stronger-than-expected economic data began to emerge. For
the remainder of the period, the bond market continued to
gain steadily as interest rates remained stable. The
economy continued to exhibit signs of slow growth and low
inflation -- a positive combination for bonds.
We believe the Fund is best positioned in the
intermediate range with an average maturity of five to ten
years. As of October 31, 1995, the Fund had an average
maturity of 8.8 years. Going forward, we expect interest
rates to continue to remain in a fairly tight trading range
and we feel the economic environment will continue to
support higher bond prices with slow economic growth and
moderate inflation. These factors should help to provide the
Fund with good buying opportunities in the future.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN
WITHOUT WITH SALES
CLASS A SHARES SALES CHARGE CHARGE
<S> <C> <C>
One Year 14.59% 9.43%
Five Years 8.68% 7.69%
Since Inception (9/8/87) 9.64% 9.02%
<CAPTION>
CLASS B SHARES WITHOUT CDSC WITH CDSC*
<S> <C> <C>
One Year 13.80% 8.80%
Since Inception (11/4/93) 3.90% 2.04%
</TABLE>
*Assumes a 5% CDSC for the one-year period and a 4%
CDSC for the period since inception.
- ---------------------------------------
GROWTH OF $10,000
[GRAPH HERE]
<TABLE>
<CAPTION>
Vista U.S. Government Income Fund Lipper General U.S. Government Fund Index
<S> <C> <C>
9/30/87 9550 10000.00
10208.95 10328.21
10228.05 10402.37
12/31/87 10405.68 10541.23
10892.8373 10886.79
11033.0421 11008.29
10810.4111 10893.89
10715.3745 10838.66
10571.2438 10772.39
10875.5675 10996.45
10772.7586 10945.17
10793.0463 10955.43
11095.5786 11177.13
11301.4335 11363.32
11121.0253 11248.92
12/31/88 11133.5561 11241.03
11288.1012 11385.41
11135.7594 11297.84
11223.0569 11331.77
11482.7108 11529.01
11810.0167 11788.58
12207.3122 12134.93
12487.8393 12336.11
12272.7219 12165.70
12318.2587 12211.46
12616.7138 12493.91
12741.6429 12602.00
12/31/89 12735.98 12632.77
12558.1095 12444.21
12555.8137 12474.98
12546.573 12475.77
12414.0142 12331.39
12759.4986 12678.53
12946.9995 12871.82
13146.3667 13040.66
12982.6347 12843.42
13098.1428 12944.41
13335.63 13115.61
13607.711 13435.93
12/31/90 13825.0905 13650.53
13979.6644 13803.59
14053.1105 13876.17
14086.9282 13938.50
14268.5323 14078.93
14328.1961 14132.58
14305.1891 14092.34
14464.7074 14288.00
14779.3828 14604.37
15079.141 14901.02
15211.5752 15031.99
15327.674 15131.40
12/31/91 15870.4461 15648.17
15598.0732 15379.14
15642.8328 15461.98
15532.3647 15368.09
15633.9014 15450.93
15904.3554 15727.85
16144.4474 15933.77
16539.3375 16257.24
16725.9136 16392.94
16996.6872 16560.20
16640.8766 16341.66
16558.2422 16353.49
12/31/92 16801.5353 16608.32
17175.8853 16882.88
17513.4802 17133.77
17577.4632 17195.31
17710.6032 17301.03
17663.9963 17312.08
18067.4426 17631.61
18153.9841 17727.86
18576.56 18027.66
18651.6633 18046.59
18696.2919 18093.14
18495.4226 17896.69
12/31/93 18535.765 17989.79
18808.4897 18223.32
18368.9348 17880.91
17983.6508 17428.05
17808.6313 17228.44
17766.6907 17163.75
17706.7119 17090.38
18037.3892 17375.98
18032.4789 17379.14
17701.4717 17114.84
17653.4509 17064.35
17601.8229 17018.59
12/31/94 17709.0081 17137.72
18049.3715 17436.73
18434.0858 17824.90
18538.0118 17906.95
18757.3155 18125.49
19477.2932 18783.48
19626.1863 18886.04
19551.3702 18816.61
19752.48 19028.84
19935.2432 19195.31
10/31/95 20228.3566 19439.10
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN
AND PRINCIPAL VALUE WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN
CLASS A SHARES OF THE VISTA U.S. GOVERNMENT INCOME FUND AND THE LIPPER GENERAL
U.S. GOVERNMENT FUND INDEX FROM SEPTEMBER 30, 1987 TO OCTOBER 31, 1995. THE
FUND'S PERFORMANCE INCLUDES A 4.50% SALES CHARGE AND ASSUMES THE REINVESTMENT
OF ALL DIVIDENDS AND CAPITAL GAINS. THE INDEX'S PERFORMANCE DOES NOT INCLUDE A
SALES CHARGE AND HAS BEEN ADJUSTED TO REFLECT REINVESTMENT OF ALL DIVIDENDS AND
CAPITAL GAINS ON MUTUAL FUNDS INCLUDED IN THE BENCHMARK.
THE LIPPER GENERAL U.S. GOVERNMENT FUND INDEX, AN EQUALLY-WEIGHTED PERFORMANCE
INDICATOR, TRACKS THE TOTAL RETURNS OF THE 30 LARGEST U.S. GOVERNMENT FUNDS IN
THE INDUSTRY. FUNDS INCLUDED IN THE INDEX ARE REPRESENTATIVE OF THE MARKET.
- -------------------------------------------------------------------------------
2
<PAGE> 85
- --------------------------------------------------------------------------------
FUND COMMENTARY
VISTA BALANCED FUND
During the past 12 months, your Fund benefited from a
generally positive economic environment for the U.S. stock
and bond markets. For the fiscal period ended October 31,
1995, the Fund had a total return of 17.70% (A shares,
without sales charge).
A number of factors converged during the past year to
create a favorable environment for both equity and bond
investors. The stock market performed positively throughout
the period, as suggested by the number of positive days
during 1995, placing the year among the top 10 best of the
past century. The technology sector was a strong performer
during the third quarter of the period, while the finance
and utility sectors led the pack.
The fixed income markets also provided a favorable
investment environment, as they extended a rally that began
in November 1994. Despite some volatility during the last
quarter, long-term interest rates ended the period
approximately 1.75% below their high from the previous
year. We expect the U.S. economy to continue its modest
growth without much danger of inflation through 1996, which
provides a favorable environment for bond investing.
At fiscal year-end, the Fund's allocation stood at 43%
equities, 19% fixed income and 35% cash equivalents. For
the period under review, the Fund benefited from its
significant investments in basic industry, capital goods
and financial companies, which performed well.
Alternatively, the Fund was hindered by its position in
consumer cyclicals, which sagged in the wake of a slowing
economy.
Going forward, we see the most promise in the basic
industry, capital goods, technology, transportation and
financial sectors; we also like some consumer staple and
health care issues. As for bonds, we expect the economic
environment to continue to support higher prices with slow
economic growth and moderate inflation. Overall, the Fund
continues to offer the opportunity for conservative blend
of growth and income with moderately less price volatility
than exhibited by the overall stock market.
- --------------------------------------------
GROWTH OF $10,000
GRAPHIC HERE
<TABLE>
<CAPTION>
Vista Balanced Fund Lipper Balanced Fund Index
<S> <C> <C>
11/02/92 9550 10000.00
9826.95 10215.52
12/31/92 10013.175 10373.30
10186.1473 10511.45
10311.0718 10638.53
10481.1612 10849.90
10481.1612 10769.01
10733.252 10939.55
10887.4153 11053.29
10858.0691 11087.93
11131.9664 11421.03
11155.4433 11450.11
11244.3706 11562.91
11125.8008 11380.40
12/31/93 11282.9058 11587.10
11584.8569 11891.07
11393.6212 11647.26
11045.371 11213.70
11014.9709 11244.46
11126.4379 11324.24
11042.331 11121.89
11266.8516 11379.98
11511.7831 11659.64
11316.8584 11438.77
11419.8326 11479.50
11224.1817 11204.46
12/31/94 11306.561 11298.15
11411.8362 11436.41
11738.1895 11768.72
11946.6345 11974.32
12095.436 12194.46
12488.6971 12588.55
12712.9622 12814.67
13055.9763 13086.67
13302.5178 13188.18
13538.34 13505.27
10/31/95 13441.1749 13473.15
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN
AND PRINCIPAL VALUE WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN CLASS A
SHARES OF THE VISTA BALANCED FUND AND THE LIPPER BALANCED FUND INDEX FROM
AUGUST 2, 1992 TO OCTOBER 31, 1995. THE FUND'S PERFORMANCE INCLUDES A 4.75%
SALES CHARGE AND ASSUMES THE REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS.
THE INDEX'S PERFORMANCE DOES NOT INCLUDE A SALES CHARGE AND HAS BEEN ADJUSTED TO
REFLECT REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS ON MUTUAL FUNDS
INCLUDED IN THE BENCHMARK.
THE LIPPER BALANCED FUND INDEX, AN EQUALLY-WEIGHTED PERFORMANCE INDICATOR,
TRACKS THE TOTAL RETURNS OF THE 30 LARGEST BALANCED FUNDS IN THE INDUSTRY.
FUNDS INCLUDED IN THE INDEX ARE REPRESENTATIVE OF THE MARKET.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
WITHOUT SALES WITH SALES
CLASS A SHARES CHARGE CHARGE
<S> <C> <C>
One Year 17.70% 12.40%
Since Inception (11/4/92) 12.09% 10.38%
<CAPTION>
CLASS B SHARES WITHOUT CDSC WITH CDSC*
<S> <C> <C>
One Year 16.93% 11.93%
Since Inception (11/4/93) 9.36% 7.50%
</TABLE>
*Assumes a 5% CDSC for the one-year period and a 4%
CDSC for the period since inception.
- --------------------------------------------------------------------
3
<PAGE> 86
---------------------------------------------------------------
FUND COMMENTARY
VISTA EQUITY INCOME FUND
The Vista Equity Income Fund turned in strong returns
during the last year in a conducive market environment for
U.S. stocks. The Fund's total return for the 12 months ended
October 31, 1995, was 17.97% (A shares, without sales
charge).
In late 1994, uncertainty dominated the stock market as
economic signals remained unclear. Economic conditions soon
began to improve, however, characterized by low inflation,
solid corporate earnings results and a firmer U.S. dollar.
In the second and third quarters of 1995, the market
climbed to record highs as the threat of inflation
dissipated and on lower short-term interest rates. Cyclical
issues soared on economic news, while technology issues
outperformed on very strong earnings results. The market was
further helped as the dollar stabilized against major
foreign currencies. The fiscal period ended on a negative
note for equities on disappointing third-quarter earnings
results in the cyclical area and mixed economic data.
For the period under review, the Fund benefited from
its significant investments in basic industry, capital goods
and financial companies, which performed well. However, our
decision to position the portfolio toward selected cyclical
issues over consumer stocks had a negative impact on total
return.
We remain favorable toward basic try, capital goods,
technology and transportation issues. We feel a modest
reacceleration of economic growth in the second half of 1995
and into 1996 should allow stocks in these groups to
continue to show solid earnings per share growth. We remain
underweighted in staples and health care. But if concerns
about the economic outlook begin to deteriorate, these
traditional big-cap defensive havens will attract some
interest despite above-average valuations. Technology has
remained volatile as investors with large holdings and solid
gains take some profits and those who missed the rally look
to buy on brief market declines.
We continue to believe that income-producing securities
offer excellent opportunities to participate in the equity
market with the benefit of excess yield and somewhat lower
volatility.
<TABLE>
<CAPTION>
- ----------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
WITHOUT
SALES WITH SALES
CLASS A SHARES CHARGE CHARGE
<S> <C> <C>
One Year 17.97% 12.66%
Since Inception
(7/15/93) 9.54% 7.36%
- ----------------------------------------------------------
</TABLE>
GROWTH OF $10,000
[GRAPH HERE]
<TABLE>
<CAPTION>
Vista Equity Income Fund Lipper Equity Income Fund Index
<S> <C> <C>
07/15/93 9550 10000.00
9600.8751902587519 10080.69
10095.0913242009132 10421.34
10238.9954337899543 10429.43
10114.7535191758007 10557.12
9880.88638578445272 10371.01
12/31/93 10012.436648317086 10557.87
10295.5023047719309 10887.60
10004.3490581326618 10617.79
9669.52282449750241 10193.50
9742.65366938865999 10326.77
9791.40756598276505 10443.98
9651.64639574633056 10291.13
9913.38595902080732 10581.71
10183.3048836476115 10933.97
9969.82355235186637 10727.03
9978.05627204827584 10785.01
9599.35116601344029 10381.05
12/31/94 9629.81222889015532 10462.87
9707.33307867549646 10649.73
10086.3238998482754 10992.45
10313.7183925519427 11250.46
10452.6236907681305 11519.58
10825.9316797241352 11872.53
11082.0383233102314 12029.90
11580.2056611877418 12359.32
11650.1238840477433 12511.35
11982.2354426327502 12900.31
10/31/95 11771.2496388006255 12717.40
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT
RETURN AND PRINCIPAL VALUE WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES
ARE REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN CLASS A
SHARES OF THE VISTA EQUITY INCOME FUND AND THE LIPPER EQUITY INCOME FUND INDEX
FROM JULY 15, 1993 TO OCTOBER 31, 1995. THE FUND'S PERFORMANCE INCLUDES A
4.75% SALES CHARGE AND ASSUMES THE REINVESTMENT OF ALL DIVIDENDS AND CAPITAL
GAINS. THE INDEX'S PERFORMANCE DOES NOT INCLUDE A SALES CHARGE AND HAS BEEN
ADJUSTED TO REFLECT REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS ON MUTUAL
FUNDS INCLUDED IN THE BENCHMARK.
THE LIPPER EQUITY INCOME FUND INDEX, AN EQUALLY WEIGHTED PERFORMANCE INDICATOR,
TRACKS THE TOTAL RETURNS OF THE 30 LARGEST EQUITY INCOME FUNDS IN THE INDUSTRY.
FUNDS INCLUDED IN THE INDEX ARE REPRESENTATIVE OF THE MARKET.
- --------------------------------------------------------------------------------
4
<PAGE> 87
- -------------------------------------------------------
FUND COMMENTARY
VISTA SMALL CAP EQUITY FUND
The Small Cap Equity Fund turned in outstanding
performance results during a period when the U.S. stock
market rallied strongly. From the Fund's inception on
December 19, 1994, through October 31, 1995, the Fund's
total return was 51.25% (A shares, without sales charge).
For the first half of the period, small-capitalization
stocks generally underperformed larger companies. This was
due to the fact that investors were seeking the perceived
safety of stocks of well-known companies; in addition, the
weaker dollar benefited larger companies with international
sales more than smaller companies with international sales.
Still, your Fund performed exceedingly well as a result of
its holdings in the financial, technology, capital goods
and energy sectors. In particular, your Fund benefited from
its investments in small niche companies that play an
important role in their sector.
In June 1995, the Small Cap Equity Fund -- and
small-cap stocks in general -- benefited as investors
shifted into small-cap issues, particularly in the capital
goods, technology and financial sectors. The stock market
as a whole climbed to record highs as the threat of
inflation dissipated and on lower short-term interest
rates. Cyclical issues soared on economic news while
technology issues outperformed on very strong earnings
results. The market was further helped as the dollar
stabilized versus major foreign currencies. The fiscal
period ended on a negative note for equities on
weaker-than-expected third-quarter earnings results in the
cyclical area and mixed economic data.
For the period under review,the Fund's total return
benefited from the decision to emphasize cyclical issues
over consumer stocks, as well as our investments in the
basic industry, capital goods, transportation and
technology sectors.
Going forward, we see the most promise in the basic
industry, capital goods, technology and transportation
sectors; we also see potential in some consumer cyclical
and financial issues. We remain cautiously optimistic about
the U.S. stock market in the months ahead.
GROWTH OF $10,000
[GRAPH HERE]
<TABLE>
<CAPTION>
Vista Small Cap Equity Fund Lipper Small Company Growth Fund Index
<S> <C> <C>
12/19/94 9525 10000.00
12/31/94 9894.57 10226.39
9589.53508670520231 10104.38
10151.9432080924856 10519.66
3/30/95 10952.6598554913295 10800.06
11343.485838150289 10950.05
11705.7147976878613 11121.87
6/30/95 12580.7837052023121 11800.48
13565.449907053253 12689.80
14053.0030749600295 12912.55
9/30/95 14473.6371806050916 13275.78
10/31/95 14406.7181183433772 12866.10
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN CLASS A
SHARES OF THE VISTA SMALL CAP EQUITY FUND AND THE LIPPER SMALL COMPANY GROWTH
FUND FROM DECEMBER 19, 1994 TO OCTOBER 31, 1995. THE FUND'S PERFORMANCE
INCLUDES A 4.75% SALES CHARGE AND ASSUMES THE REINVESTMENT OF ALL DIVIDENDS AND
CAPITAL GAINS. THE INDEX'S PERFORMANCE DOES NOT INCLUDE A SALES CHARGE AND HAS
BEEN ADJUSTED TO REFLECT REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS ON
MUTUAL FUNDS INCLUDED IN THE BENCHMARK.
THE LIPPER SMALL COMPANY GROWTH FUND INDEX, AN EQUALLY-WEIGHTED PERFORMANCE
INDICATOR, TRACKS THE TOTAL RETURNS OF THE 30 LARGEST SMALL COMPANY GROWTH
FUNDS IN THE INDUSTRY. FUNDS INCLUDED IN THE INDEX ARE REPRESENTATIVE OF THE
MARKET.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- -----------------------------------------------------------------
TOTAL RETURN
WITHOUT SALES WITH SALES
CLASS A SHARES CHARGE CHARGE
<S> <C> <C>
6 Months 27.00% 20.97%
Since Inception (12/20/94) 51.25% 44.07%
<CAPTION>
CLASS B SHARES WITHOUT CDSC WITH CDSC*
<S> <C> <C>
6 Months 26.54% 21.54%
Since Inception (3/28/95) 32.09% 27.09%
</TABLE>
*Assumes a 5% CDSC for the one-year period and
for the period since inception.
- -----------------------------------------------------------------
5
<PAGE> 88
VISTA U.S. GOVERNMENT INCOME FUND
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Issuer Amount Value
- ----------------------------------- ------------ -------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 94.0%
U.S. Treasury Bond -- 27.5%
8.500%, due 02/15/20.............. $ 24,150,000 $ 30,191,364
------------
U.S. Treasury Notes -- 66.5%
4.250%, due 12/31/95.............. 100,000 99,781
5.625%, due 06/30/97.............. 12,885,000 12,885,000
5.625%, due 01/31/98.............. 9,250,000 9,241,305
6.125%, due 05/15/98.............. 9,560,000 9,660,094
6.125%, due 09/30/00.............. 1,260,000 1,275,548
6.375%, due 01/15/99.............. 9,000,000 9,170,190
6.500%, due 05/15/05.............. 2,800,000 2,898,000
6.500%, due 08/15/05.............. 3,000,000 3,106,860
7.375%, due 11/15/97.............. 9,000,000 9,293,940
7.750%, due 11/30/99.............. 4,400,000 4,706,636
9.125%, due 05/15/99.............. 9,632,000 10,650,873
------------
72,988,227
------------
<CAPTION>
Principal
Issuer Amount Value
- ----------------------------------- ------------ -------------
<S> <C> <C>
TOTAL LONG-TERM INVESTMENTS
(Cost $100,234,977).............. 103,179,591
------------
SHORT-TERM INVESTMENT -- 4.2%
Repurchase Agreement -- 4.2%
Aubrey G. Lanston,
5.85%, due 11/1/95, (Dated
10/31/95; Proceeds $4,607,749,
Secured by $4,475,000 U.S.
Treasury Note, 8.00%, due 1/15/97;
Market Value $4,703,226) (Cost
$4,607,000)....................... $ 4,607,000 $ 4,607,000
------------
TOTAL INVESTMENTS
(COST $104,841,977).............. 98.2% $107,786,591
============
</TABLE>
See notes to financial statements.
6
<PAGE> 89
VISTA BALANCED FUND
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- --------------------------------------- --------- -------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 70.1%
COMMON STOCK -- 42.4%
Aerospace -- 1.6%
AlliedSignal, Inc. .................... 3,900 $ 165,750
General Motors Corp., Class H.......... 3,300 138,600
Lockheed Martin Corp. ................. 1,300 88,562
Sundstrand Corp. ...................... 1,200 73,500
United Technologies, Corp. ............ 1,800 159,750
-------------
626,162
-------------
Agricultural Products/Services -- 1.5%
AGCO Corp. ............................ 2,500 111,875
Arcadian Corp.*........................ 8,200 169,125
Case Corp. ............................ 6,000 228,750
IMC Global, Inc. ...................... 1,100 77,000
-------------
586,750
-------------
Airlines -- 0.2%
AMR Corp.*............................. 1,100 72,600
-------------
Apparel/Textiles -- 0.3%
Springs Industries, Inc., Class A...... 1,900 81,463
V.F. Corp. ............................ 1,000 47,875
-------------
129,338
-------------
Automotive -- 1.0%
Chrysler Corp. ........................ 1,825 94,216
Echlin, Inc. .......................... 6,500 232,375
TRW Inc. .............................. 1,100 72,325
-------------
398,916
-------------
Banking -- 2.4%
Bank of New York Company, Inc. ........ 3,800 159,600
Citicorp............................... 3,500 227,062
First Bank System Inc. ................ 2,600 129,350
NationsBank Corp. ..................... 2,400 157,800
Norwest Corp. ......................... 3,300 97,350
Standard Federal Bancorporation........ 2,100 74,550
Zions Bancorporation................... 1,400 96,950
-------------
942,662
-------------
Chemicals -- 1.7%
Air Products & Chemicals, Inc.,........ 4,400 227,150
Applied Extrusion Technologies,
Inc.*................................. 6,000 92,250
Cabot Corp. ........................... 1,200 57,000
duPont (EI) deNemours.................. 2,800 174,650
Eastman Chemical Co. .................. 1,200 71,400
Praxair, Inc. ......................... 2,700 72,900
-------------
695,350
-------------
Computer Software -- 1.3%
Computer Associates International...... 2,250 123,750
General Motors Corp., Class E.......... 2,700 127,237
Harbinger Corp.*....................... 5,000 70,000
Maxis, Inc.*........................... 3,000 132,750
Reynolds & Reynolds, Inc., Class A..... 2,000 71,250
-------------
524,987
-------------
Computers/Computer Hardware -- 1.8%
Comdisco, Inc. ........................ 2,100 64,050
Compaq Computer*....................... 4,500 250,875
International Business Machines
Corp. ................................ 800 77,800
<CAPTION>
Issuer Shares Value
- --------------------------------------- --------- -------------
<S> <C> <C>
SCI Systems, Inc.*..................... 2,500 $ 87,813
Sun Microsystems, Inc.*................ 3,200 249,600
-------------
730,138
-------------
Construction Machinery -- 0.4%
Caterpillar Inc. ...................... 3,000 168,375
-------------
Construction Materials -- 0.3%
Manville Corp.*........................ 3,500 40,688
Texas Industries Inc. ................. 1,700 89,462
-------------
130,150
-------------
Consumer Products -- 0.9%
Black & Decker Corp. .................. 4,000 135,500
Danaher Corp. ......................... 2,300 71,300
USA Detergents, Inc.*.................. 3,000 76,500
Whirlpool Corp. ....................... 1,500 79,500
-------------
362,800
-------------
Diversified -- 0.4%
Textron, Inc. ......................... 2,200 151,250
-------------
Electronics/Electrical
Equipment -- 1.1%
Integrated Device Technology, Inc.*.... 3,000 57,000
Pioneer Standard Electronics, Inc. .... 4,650 64,519
Texas Instruments...................... 2,800 191,100
Xilinx, Inc.*.......................... 2,400 110,400
-------------
423,019
-------------
Entertainment -- 0.3%
Showboat, Inc. ........................ 2,000 48,000
Time Warner, Inc. ..................... 1,500 54,750
-------------
102,750
-------------
Environmental Services -- 0.1%
Browning-Ferris Industries, Inc. ...... 1,500 43,687
-------------
Financial Services -- 2.0%
American General Corp. ................ 4,800 157,800
Dean Witter, Discover & Co. ........... 3,500 174,125
Donaldson Lufkin & Jenrette*........... 8,000 238,000
Federal National Mortgage Assoc. ...... 1,500 157,313
Household International, Inc. ......... 1,100 61,875
-------------
789,113
-------------
Food/Beverage Products -- 2.2%
Coca-Cola Enterprises, Inc. ........... 8,000 213,000
ConAgra, Inc. ......................... 2,500 96,563
CPC International, Inc. ............... 1,500 99,562
IBP, Inc. ............................. 1,400 83,825
PepsiCo., Inc. ........................ 2,100 110,775
Philip Morris Companies, Inc. ......... 2,400 202,800
RJR Nabisco Holdings Corp. ............ 3,000 92,250
-------------
898,775
-------------
Health Care -- 2.1%
American Oncology Resources, Inc.*..... 1,900 66,500
Apria Healthcare Group, Inc.*.......... 3,400 73,525
Baxter International Inc. ............. 3,000 115,875
Beverly Enterprises*................... 4,500 52,875
Columbia/HCA Healthcare Corp. ......... 3,000 147,375
FHP International Corp.*............... 2,000 48,500
</TABLE>
See notes to financial statements.
7
<PAGE> 90
VISTA BALANCED FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- --------------------------------------- --------- -------------
<S> <C> <C>
Gelman Sciences, Inc.*................. 2,500 $ 53,437
Humana, Inc.*.......................... 4,000 84,500
Manor Care, Inc. ...................... 1,800 58,950
OrNda Healthcorp*...................... 3,500 61,688
Physician Corp. of America*............ 1,500 23,062
Tenet Healthcare Corp.*................ 3,900 69,713
-------------
856,000
-------------
Hotels/Other Lodging -- 0.3%
Renaissance Hotel Group N.V.*.......... 7,000 136,500
-------------
Insurance -- 1.6%
American International Group........... 1,950 164,531
Chubb Corp. ........................... 1,100 98,863
Mid Ocean Ltd. ........................ 1,100 38,912
Prudential Reinsurance Holdings,
Inc.*................................. 5,000 101,875
St. Paul Companies, Inc. .............. 2,900 147,175
Transatlantic Holdings, Inc. .......... 1,200 80,850
-------------
632,206
-------------
Leisure -- 0.4%
Oakley, Inc.*.......................... 3,500 120,750
Recoton Corp.*......................... 2,400 53,400
-------------
174,150
-------------
Manufacturing -- 1.7%
Eaton Corp. ........................... 2,500 128,125
Johnson Controls....................... 3,600 209,700
Kennametal Inc. ....................... 2,200 68,475
Mark IV Industries..................... 2,100 40,950
Modine Manufacturing Co. .............. 2,000 55,000
Varity Corp.*.......................... 5,200 188,500
-------------
690,750
-------------
Metals/Mining -- 1.0%
Aluminum Co. of America (ALCOA)........ 3,000 153,000
Inco, Ltd. ............................ 7,300 250,938
-------------
403,938
-------------
Office/Business Equipment -- 0.2%
Xerox Corp. ........................... 500 64,875
-------------
Oil & Gas -- 3.5%
Amoco Corp. ........................... 1,400 89,425
Ashland Inc. .......................... 2,700 85,387
Halliburton Company.................... 5,200 215,800
Mobil Corp. ........................... 2,000 201,500
NGC Corp. ............................. 15,000 135,000
Panhandle Eastern Corp. ............... 8,200 207,050
Phillips Petroleum Co. ................ 3,500 112,875
Smith International*................... 4,800 76,800
Triton Energy Corp. ................... 1,300 60,613
Union Texas Petroleum Holdings......... 2,500 45,000
Unocal Corp. .......................... 3,500 91,875
Williams Companies, Inc. .............. 1,800 69,525
-------------
1,390,850
-------------
Paper/Forest Products -- 1.3%
Boise Cascade Corp. ................... 2,100 76,125
Champion International Corp. .......... 3,900 208,650
<CAPTION>
Issuer Shares Value
- --------------------------------------- --------- -------------
<S> <C> <C>
Mead Corp. ............................ 1,500 $ 86,437
Willamette Industries.................. 2,500 145,000
-------------
516,212
-------------
Pharmaceuticals -- 1.0%
Allergan, Inc. ........................ 4,500 132,188
American Home Products Corp. .......... 2,000 177,250
Schering-Plough Corp. ................. 2,000 107,250
-------------
416,688
-------------
Printing & Publishing -- 0.5%
Harcourt General, Inc. ................ 3,200 126,800
Tribune Co. ........................... 1,000 63,125
-------------
189,925
-------------
Real Estate Investment Trust -- 0.2%
Bay Apartment Communities, Inc. ....... 4,000 82,500
-------------
Restaurants/Food Services -- 0.3%
Wendy's International, Inc. ........... 5,500 109,312
-------------
Retailing -- 3.0%
American Stores Co. ................... 3,600 107,550
Baker J., Inc. ........................ 2,900 16,675
Circuit City Stores, Inc. ............. 7,500 250,314
Dayton-Hudson Corp. ................... 2,400 165,000
Eckerd Corp.*.......................... 3,400 134,725
Ethan Allen Interiors, Inc.*........... 3,100 61,225
K-Mart Corp. .......................... 6,500 52,812
Kroger Co.*............................ 6,300 210,263
May Department Stores.................. 4,400 172,700
Nordstrom, Inc. ....................... 1,200 44,475
-------------
1,215,739
-------------
Shipping/Transportation -- 1.0%
Consolidated Railway, Inc. ............ 1,000 68,750
Pittston Services Group................ 2,000 55,000
CSX Corp. ............................. 2,400 201,000
Ryder System........................... 3,100 74,787
-------------
399,537
-------------
Steel -- 0.3%
USX-US Steel Group, Inc. .............. 3,600 107,550
-------------
Telecommunications -- 1.5%
AT&T Corp. ............................ 2,600 166,400
GTE Corp. ............................. 4,200 173,250
Liberty Media Group, Class A*.......... 500 12,312
NYNEX Corp. ........................... 1,400 65,800
Sprint Corp. .......................... 1,484 57,134
Tele-Communications, Class A*.......... 2,000 34,000
U S West, Inc. ........................ 2,000 95,250
-------------
604,146
-------------
Toys & Games -- 0.2%
Mattel, Inc. .......................... 2,500 71,875
-------------
Utilities -- 2.8%
CMS Energy Corp. ...................... 4,600 127,075
DQE, Inc. ............................. 2,750 75,625
Florida Progress Corp. ................ 2,900 96,062
</TABLE>
See notes to financial statements.
8
<PAGE> 91
VISTA BALANCED FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- --------------------------------------- --------- -------------
<S> <C> <C>
FPL Group Inc. ........................ 4,200 $ 175,875
Nipsco Industries Inc. ................ 4,600 167,900
Pacific Enterprises.................... 1,800 44,550
PECO Energy Co. ....................... 3,000 87,750
Pinnacle West Capital Corp. ........... 6,600 181,500
Portland General Corp. ................ 3,200 86,800
Public Service Co. of Colorado......... 2,000 68,250
-------------
1,111,387
-------------
TOTAL COMMON STOCK
(Cost $14,680,089).................... 16,950,962
-------------
CONVERTIBLE PREFERRED STOCK -- 1.2%
Financial Services -- 0.9%
American General Corp.,
$3.00, Ser. A......................... 2,000 103,500
St. Paul Capital Corp., 6.00%.......... 5,000 270,000
-------------
373,500
-------------
Food/Beverage Products -- 0.3%
RJR Nabisco Holdings Corp.,
$0.6012, Ser. C....................... 20,000 125,000
-------------
TOTAL CONVERTIBLE
PREFERRED STOCK
(Cost $473,500)....................... 498,500
-------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
-----------
<S> <C> <C>
CONVERTIBLE CORPORATE
BONDS -- 1.8%
Consumer Products -- 0.4%
Grand Metropolitan PLC,#
6.500%, due 01/31/00.................. $ 150,000 169,283
------------
Health Care -- 0.4%
Assisted Living Concepts,#
7.000%, due 08/15/05.................. 150,000 164,500
------------
Insurance -- 0.6%
American Travellers Corp.,
6.500%, due 10/01/05.................. 200,000 237,500
------------
Manufacturing -- 0.4%
3 Com Corp.,#
10.250%, due 11/01/01................. 100,000 163,511
------------
TOTAL CONVERTIBLE
CORPORATE BONDS
(Cost $600,000)...................... 734,794
------------
<CAPTION>
Principal
Issuer Amount Value
- --------------------------------------- ----------- ------------
<S> <C> <C>
CORPORATE BONDS -- 8.9%
Banking -- 1.6%
Security Pacific Corp.,
10.300%, due 05/15/01................. $ 550,000 $ 650,425
------------
Financial Services -- 7.3%
Ford Capital BV,
9.000%, due 08/15/98.................. 400,000 428,564
General Electric Capital Corp.,
9.180%, due 12/30/08.................. 500,000 603,220
General Motors Acceptance Corp.,
8.625%, due 06/15/99.................. 650,000 697,586
Goldman Sachs Group,#
6.200%, due 02/15/01.................. 700,000 687,043
Household Finance Co.,
7.750%, due 06/15/97.................. 500,000 512,845
------------
2,929,258
------------
TOTAL CORPORATE BONDS
(Cost $3,598,855)..................... 3,579,683
------------
U.S. GOVERNMENT OBLIGATIONS -- 10.8%
U.S. Treasury Bonds -- 7.0%
7.500%, due 11/15/24.................. 900,000 1,028,250
8.500%, due 02/15/20.................. 1,400,000 1,750,224
------------
2,778,474
------------
U.S. Treasury Note, 3.8%
6.500%, due 08/15/05.................. 1,480,000 1,532,718
------------
TOTAL U.S. GOVERNMENT OBLIGATIONS
(Cost $4,164,554)..................... 4,311,192
------------
U.S. GOVERNMENT AGENCY
OBLIGATIONS -- 2.5%
Federal National Mortgage Assoc.,
4.680%, due 01/25/96
(Cost $1,000,110)..................... 1,000,000 997,490
------------
FLOATING RATE NOTE -- 2.5%
Financial Services -- 2.5%
Goldman Sachs & Co.,#
5.630%, due 07/22/96
(Cost $1,000,000)..................... 1,000,000 1,000,000
------------
TOTAL LONG-TERM INVESTMENTS
(Cost $25,517,108)................... 28,072,621
------------
</TABLE>
See notes to financial statements.
9
<PAGE> 92
VISTA BALANCED FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Issuer Amount Value
- --------------------------------------- ----------- ------------
<S> <C> <C>
SHORT-TERM INVESTMENTS -- 29.4%
COMMERCIAL PAPER -- 29.4%
Financial Services -- 29.4%
Broadway Capital Corp.,#
5.750%, due 11/15/95.................. $ 2,000,000 $ 1,995,528
Household Finance Corp.,
5.800%, due 11/01/95.................. 7,796,000 7,796,000
Receivables Capital Corp.,#
5.730%, due 12/05/95.................. 2,000,000 1,989,176
------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $11,780,704)................... 11,780,704
------------
TOTAL INVESTMENTS
(COST $37,297,812)................... 99.5% $ 39,853,325
=============
- -------------------
# Security may only be sold to qualified institutional
investors.
* Non Income producing.
Note: Rates indicated for floating rate investments are rates in
effect at October 31, 1995.
</TABLE>
See notes to financial statements.
10
<PAGE> 93
VISTA EQUITY INCOME FUND
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ------------------------------------------- ------- ------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 93.1%
COMMON STOCK -- 63.8%
Aerospace -- 4.4%
AlliedSignal, Inc. ........................ 3,800 $ 161,500
General Motors Corp. , Class H............. 4,200 176,400
United Technologies, Corp. ................ 2,000 177,500
------------
515,400
------------
Automotive -- 1.7%
Dana Corp. ................................ 2,100 53,813
General Motors Corp. ...................... 3,200 140,000
------------
193,813
------------
Banking -- 3.5%
Bank of New York Company, Inc. ............ 2,700 113,400
First Union Corp. ......................... 2,600 129,025
NationsBank Corp. ......................... 2,500 164,375
------------
406,800
------------
Chemicals -- 4.2%
Arcadian Corp.*............................ 10,000 206,250
Dow Chemical Co. .......................... 1,000 68,625
duPont (EI) deNemours...................... 2,200 137,225
Union Carbide Corp. ....................... 2,000 75,750
------------
487,850
------------
Computer Software -- 1.0%
Cooper & Chyan Technology, Inc.*........... 2,000 28,250
Eagle Point Software Corp.*................ 5,000 96,250
------------
124,500
------------
Computers/Computer Hardware -- 1.3%
Comdisco, Inc. ............................ 5,000 152,500
------------
Diversified -- 1.5%
Textron, Inc. ............................. 2,600 178,750
------------
Financial Services -- 4.2%
American General Corp. .................... 4,100 134,787
Donaldson Lufkin & Jenrette*............... 3,000 89,250
Federal National Mortgage Assoc. .......... 1,500 157,313
Household International, Inc. ............. 1,900 106,875
------------
488,225
------------
Food/Beverage Products -- 2.2%
ConAgra, Inc. ............................. 3,000 115,875
International Multifoods Corp. ............ 2,000 41,000
RJR Nabisco Holdings Corp. ................ 3,300 101,475
------------
258,350
------------
Health Care -- 2.2%
American Oncology Resources, Inc.*......... 2,500 87,500
Baxter International Inc. ................. 4,500 173,813
------------
261,313
------------
Insurance -- 1.5%
Cigna Corp. ............................... 900 89,213
Mid Ocean Ltd. ............................ 2,400 84,900
------------
174,113
------------
<CAPTION>
Issuer Shares Value
- ------------------------------------------- ------- ------------
<S> <C> <C>
Manufacturing -- 2.8%
Eaton Corp. ............................... 2,400 $ 123,000
Johnson Controls........................... 3,500 203,875
------------
326,875
------------
Metals/Mining -- 1.2%
Phelps Dodge Corp. ........................ 2,300 145,763
------------
Office/Business Equipment -- 0.3%
Moore Corporation, Ltd. ................... 1,700 32,513
------------
Oil & Gas -- 8.7%
Amoco Corp. ............................... 2,500 159,687
Halliburton Company........................ 4,200 174,300
Mobil Corp. ............................... 1,700 171,275
NGC Corp. ................................. 10,000 90,000
Panhandle Eastern Corp. ................... 4,400 111,100
Phillips Petroleum Co. .................... 3,900 125,775
Williams Companies, Inc. .................. 4,700 181,538
------------
1,013,675
------------
Paper/Forest Products -- 1.0%
Willamette Industries...................... 2,000 116,000
------------
Pharmaceuticals -- 1.4%
Schering-Plough Corp. ..................... 3,000 160,875
------------
Real Estate Investment Trust -- 2.4%
Bay Apartment Communities, Inc. ........... 3,800 78,375
Hospitality Properties Trust............... 5,000 131,250
Liberty Property Trust..................... 3,700 74,925
------------
284,550
------------
Retailing -- 3.6%
American Stores Co. ....................... 4,000 119,500
Dayton-Hudson Corp. ....................... 2,500 171,875
May Department Stores...................... 3,500 137,375
------------
428,750
------------
Shipping/Transportation -- 2.6%
Consolidated Railway, Inc. ................ 1,500 103,125
CSX Corp. ................................. 800 67,000
Ryder System, Inc. ........................ 5,300 127,863
------------
297,988
------------
Steel -- 0.8%
USX-US Steel Group, Inc. .................. 3,000 89,625
------------
Telecommunications -- 5.1%
A T & T Corp. ............................. 2,300 147,200
Frontier Corp. ............................ 5,400 145,800
GTE Corp. ................................. 2,700 111,375
Sprint Corp. .............................. 3,200 123,200
U S West, Inc. ............................ 1,700 80,962
------------
608,537
------------
Textile Mill Products -- 0.7%
Springs Industries, Inc., Class A.......... 1,900 81,462
------------
</TABLE>
See notes to financial statements.
11
<PAGE> 94
VISTA EQUITY INCOME FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ------------------------------------------- ------- ------------
<S> <C> <C>
Utilities -- 5.5%
CINergy Corp. ............................. 3,500 $ 99,312
CMS Energy Corp. .......................... 4,200 116,025
Florida Progress Corp. .................... 2,800 92,750
FPL Group Inc. ............................ 3,400 142,375
IPALCO Enterprises, Inc. .................. 2,700 99,562
Oklahoma Gas & Electric Co. ............... 2,500 100,000
------------
650,024
------------
TOTAL COMMON STOCK
(Cost $6,433,233)........................ 7,478,251
------------
CONVERTIBLE PREFERRED STOCK -- 13.5%
Computers/Computer Hardware -- 1.7%
Ceridian Corp., 5.5%....................... 2,000 195,000
------------
Electronics/Electrical Equipment -- 0.4%
Westinghouse Electric, $1.30#.............. 3,000 41,181
------------
Environmental Services -- 0.6%
Browning-Ferris, 7.25% "ACES".............. 2,000 65,750
------------
Financial Services -- 3.6%
American General Corp., $3.00.............. 3,000 155,250
St. Paul Capital Corp., 6.0%............... 5,000 270,000
------------
425,250
------------
Oil & Gas -- 4.7%
Diamond Shamrock, 5%#...................... 5,000 272,500
Occidental Petroleum, $3.00................ 5,000 282,500
------------
555,000
------------
Paper/Forest Products -- 0.7%
International Paper Capital Corp.,
5.25%#.................................... 2,000 87,838
------------
Steel -- 1.8%
WHX Corp., Ser. B, $3.75................... 5,000 210,000
------------
TOTAL CONVERTIBLE
PREFERRED STOCK
(Cost $1,491,750)........................ 1,580,019
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
---------
<S> <C> <C>
CONVERTIBLE CORPORATE
BONDS & NOTES -- 15.8%
Computer Software -- 0.8%
Spectrum Holobyte, Inc.,#
6.500%, due 09/15/02.................. $ 100,000 95,691
------------
Electronics/Electrical
Equipment -- 0.9%
Sanmina Corp.,#
5.500%, due 08/15/02.................. 100,000 111,222
------------
<CAPTION>
Principal
Amount Value
--------- ------------
<S> <C> <C>
Entertainment -- 1.2%
Time Warner, Inc.,
8.750%, due 01/10/15.................. $ 136,850 $ 142,837
------------
Financial Services -- 1.8%
MBL International Finance Bermuda,
3.000%, due 11/30/02.................. 200,000 208,900
------------
Healthcare -- 0.9%
Assisted Living Concepts,#
7.000%, due 08/15/05.................. 100,000 109,667
------------
Insurance -- 2.0%
American Travellers Corp.,
6.500%, due 10/01/05.................. 200,000 237,500
------------
Manufacturing -- 2.1%
3 Com Corp.,#
10.250%, due 11/01/01................. 150,000 245,266
------------
Restaurants/Food Services -- 1.0%
Boston Chicken,
4.500%, due 02/01/04.................. 100,000 120,250
------------
Shipping/Transportation -- 2.1%
Airborne Freight,
6.750%, due 08/15/01.................. 250,000 251,250
------------
Textiles -- 3.0%
Unifi Inc.,
6.000%, due 03/15/02.................. 350,000 347,105
------------
TOTAL CONVERTIBLE CORPORATE
BONDS & NOTES
(Cost $1,668,454).................... 1,869,688
------------
TOTAL LONG-TERM
INVESTMENTS -- 93.1%
(Cost $9,593,437)..................... 10,927,958
------------
SHORT-TERM INVESTMENTS -- 6.7%
COMMERCIAL PAPER -- 6.7%
Household Finance Corp.,
5.800%, due 11/01/95
(Cost $787,000)...................... 787,000 787,000
------------
TOTAL INVESTMENTS --
(COST $10,380,437).................... 99.8% $ 11,714,958
=============
- -----
* Non-income producing securities.
# Security may only be sold to qualified institutional
investors.
ACES = Automatic Common Exchange Securities
</TABLE>
See notes to financial statements.
12
<PAGE> 95
VISTA SMALL CAP EQUITY FUND
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ------------------------------------------- ------- ------------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 68.5%
COMMON STOCK -- 65.7%
Agricultural Products/Services -- 2.4%
AGCO Corp.................................. 15,000 $ 671,250
Arcadian Corp.*............................ 45,000 928,125
------------
1,599,375
------------
Airlines -- 0.8%
America West Airlines, Inc., Class B*...... 40,000 545,000
------------
Automotive -- 0.4%
Masland Corp. ............................. 20,000 280,000
------------
Banking -- 2.5%
Mountain Parks Financial Corp.*............ 20,000 465,000
Zions Bancorporation....................... 17,000 1,177,250
------------
1,642,250
------------
Business Services -- 1.2%
ITT Educational Services, Inc.*............ 20,000 470,000
Sitel Corp.*............................... 15,000 341,250
------------
811,250
------------
Chemicals -- 2.3%
Applied Extrusion Technologies, Inc.*...... 40,000 615,000
Material Sciences Corp.*................... 6,500 108,062
Mississippi Chemical....................... 25,000 603,125
The Geon Company........................... 6,000 149,250
------------
1,475,437
------------
Computer Software -- 8.8%
American Management Systems, Inc.*......... 6,000 173,250
Arc Systems, Inc.*......................... 8,000 336,000
Baan Company, N.V.*........................ 4,400 187,000
Computervision Corp.*...................... 65,000 763,750
Datastream Systems, Inc.*.................. 10,000 222,500
Desktop Data, Inc.*........................ 2,000 71,500
Discreet Logic, Inc.*...................... 7,000 399,000
Eagle Point Software Corp.*................ 12,000 231,000
Expert Software, Inc.*..................... 10,000 207,500
Hummingbird Communications Ltd.*........... 17,000 731,000
Legato Systems, Inc.*...................... 5,000 182,500
Maxis, Inc.*............................... 11,000 486,750
National Instruments Corp.*................ 17,000 318,750
Netscape Communications Corp.*............. 2,500 220,000
Novadigm, Inc.*............................ 3,200 65,600
Smith Micro Software, Inc.*................ 6,000 73,500
Softkey International, Inc.*............... 12,000 378,000
Wind River Systems*........................ 25,000 675,000
------------
5,722,600
------------
Computers/Computer Hardware -- 2.1%
Applied Magnetics Corp.*................... 25,000 384,375
Cornerstone Imaging, Inc.*................. 22,500 506,250
Micros Systems, Inc.*...................... 13,000 484,250
------------
1,374,875
------------
Construction Materials -- 1.1%
Texas Industries Inc....................... 14,000 736,750
------------
<CAPTION>
Issuer Shares Value
- ------------------------------------------- ------- ------------
<S> <C> <C>
Diversified -- 0.6%
Albany International Corp., Class A........ 20,000 $ 415,000
------------
Electronics/Electrical Equipment -- 9.4%
California Amplifier, Inc.*................ 23,000 621,000
C.P. Clare Corp.*.......................... 25,700 664,988
ESS Technology, Inc.*...................... 11,100 333,000
Etec Systems, Inc. *....................... 17,000 187,000
Information Storage Devices, Inc.*......... 29,150 634,012
ITI Technologies, Inc.*.................... 35,000 883,750
Kulicke & Soffa Industries, Inc.*.......... 15,000 525,000
Micro Linear Corp.*........................ 25,000 384,375
Microchip Technology, Inc.*................ 23,000 912,813
Smartflex Systems, Inc.*................... 7,000 102,375
Tegal Corp.*............................... 54,000 688,500
Tencor Instuments*......................... 5,000 213,125
------------
6,149,938
------------
Entertainment -- 0.8%
Cinar Films, Inc., Class B*................ 45,000 534,375
------------
Environmental Services -- 2.0%
Newpark Resources, Inc.*................... 21,000 333,375
Sanifill, Inc.*............................ 12,000 378,000
United Waste Systems, Inc.*................ 15,000 592,500
------------
1,303,875
------------
Financial Services -- 2.1%
Aames Financial Corp. ..................... 10,000 250,000
Alex. Brown, Inc. ......................... 2,000 97,750
MS Financial, Inc.*........................ 25,000 281,250
Olympic Financial Ltd.*.................... 5,000 91,250
SEI Corp................................... 12,800 272,000
WFS Financial, Inc.*....................... 21,300 354,112
------------
1,346,362
------------
Health Care -- 3.3%
Enterprise Systems, Inc.*.................. 5,000 116,875
Gelman Sciences, Inc.*..................... 25,000 534,375
OrNda Healthcorp*.......................... 20,000 352,500
Sterling House Corp.*...................... 42,000 519,750
Universal Health Services, Inc., Class
B*........................................ 17,500 656,250
------------
2,179,750
------------
Hotels/Other Lodging -- 0.8%
Renaissance Hotel Group N.V.*.............. 25,000 487,500
------------
Insurance -- 4.1%
American Travellers Corp.*................. 25,000 559,375
Life Partners Group, Inc. ................. 5,000 90,625
Prudential Reinsurance Holdings, Inc.*..... 26,000 529,750
PXRE Corp.................................. 25,000 637,500
Renaissancere Holdings Ltd.*............... 30,000 813,750
United Dental Care, Inc.*.................. 2,000 61,000
------------
2,692,000
------------
</TABLE>
See notes to financial statements.
13
<PAGE> 96
VISTA SMALL CAP EQUITY FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ------------------------------------------- ------- ------------
<S> <C> <C>
Leisure -- 3.0%
Anthony Industries, Inc. .................. 25,000 $ 465,625
Oakley, Inc.*.............................. 24,100 831,450
Recoton Corp.*............................. 30,000 667,500
------------
1,964,575
------------
Machinery & Engineering Equipment -- 3.2%
Applied Power, Inc., Class A............... 25,000 759,375
Blount Inc., Class A....................... 10,000 433,750
Computational Systems, Inc.*............... 11,450 170,319
Precision Castparts Corp................... 7,500 268,125
Valmont Industries......................... 20,000 490,000
------------
2,121,569
------------
Manufacturing -- 0.3%
Elsag Bailey Process Automation N.V.,
ADR*...................................... 8,000 218,000
------------
Metals/Mining -- 0.3%
Commonwealth Aluminum Corp................. 11,000 177,375
------------
Oil & Gas -- 2.0%
NGC Corp. ................................. 20,000 180,000
Nowsco Well Service, Ltd................... 10,000 113,750
Smith International*....................... 30,000 480,000
Total Petroleum of North America........... 17,000 172,125
Weatherford Enterra, Inc. ................. 13,000 313,625
------------
1,259,500
------------
Printing & Publishing -- 1.0%
Pulitzer Publishing........................ 15,000 678,750
------------
Real Estate -- 0.5%
NHP, Inc.*................................. 25,000 356,250
------------
Real Estate Investment Trust -- 0.4%
Oasis Residential, Inc..................... 12,000 261,000
------------
Restaurants/Food Services -- 0.9%
Daka International, Inc.*.................. 20,000 607,500
------------
Retailing -- 3.8%
Big B Inc. ................................ 18,000 265,500
Casey's General Stores, Inc................ 15,000 345,000
Consolidated Stores Corp.*................. 23,000 531,875
Ethan Allen Interiors, Inc.*............... 4,800 94,800
Gucci Group NV*............................ 17,800 534,000
Nieman-Marcus Group, Inc.*................. 40,000 685,000
------------
2,456,175
------------
Shipping/Transportation -- 1.2%
Landstar System, Inc.*..................... 12,000 315,000
Mark VII, Inc.*............................ 25,000 446,875
------------
761,875
------------
Steel -- 0.5%
Northwestern Steel & Wire Co.*............. 40,000 300,000
------------
<CAPTION>
Issuer Shares Value
- ------------------------------------------- ------- ------------
<S> <C> <C>
Telecommunications -- 1.3%
Aspect Telecommunications Corp.*........... 25,000 $ 859,375
------------
Textile Mill Products -- 1.3%
St. John Knits, Inc. ...................... 17,500 837,812
------------
Utilities -- 1.1%
Oklahoma Gas & Electric Co. ............... 17,500 700,000
------------
Wholesaling -- 0.2%
US Office Products Co.*.................... 7,500 128,438
------------
TOTAL COMMON STOCK
(Cost $36,170,280)....................... 42,984,531
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
-----------
<S> <C> <C>
CONVERTIBLE CORPORATE
BONDS & NOTES -- 2.8%
Computer Software -- 1.0%
Softkey International Inc.,#
5.500%, due 11/01/00................. $ 500,000 421,020
Spectrum Holobyte, Inc.,#
6.500%, due 09/15/02................. 250,000 239,228
------------
660,248
------------
Electronics/Electrical
Equipment -- 0.5%
Sanmina Corp.,#
5.500%, due 08/15/02................. 300,000 333,666
------------
Health Care -- 0.4%
Assisted Living Concepts,#
7.000%, due 08/15/05................. 250,000 274,167
------------
Insurance -- 0.9%
American Travellers Corp.,
6.500%, due 10/01/05................. 500,000 593,750
------------
TOTAL CONVERTIBLE CORPORATE BONDS &
NOTES
(Cost $1,800,000).................... 1,861,831
------------
TOTAL LONG-TERM INVESTMENTS
(Cost $37,970,280)................... 44,846,362
------------
SHORT-TERM INVESTMENTS -- 26.6%
U.S. GOVERNMENT OBLIGATIONS -- 0.1%
U.S. Treasury Bills -- 0.1%
5.150%, due 12/07/95+................ 10,000 9,949
5.300%, due 12/07/95+................ 54,000 53,723
------------
(Cost $63,672)....................... 63,672
------------
</TABLE>
See notes to financial statements.
14
<PAGE> 97
VISTA SMALL CAP EQUITY FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Issuer Amount Value
- -------------------------------------- ----------- ------------
<S> <C> <C>
COMMERCIAL PAPER -- 26.5%
Financial Services -- 20.3%
Broadway Capital Corp.,#,+
5.750%, due 11/13/95................. $ 2,000,000 $ 1,996,167
Ciesco LP,
5.730%, due 11/14/95................. 2,000,000 1,995,862
Household Finance Corp.,
5.800%, due 11/01/95................. 7,258,000 7,258,000
Sony Capital Corp.,#,+
5.710%, due 12/08/95................. 2,000,000 1,988,263
------------
13,238,292
------------
Oil & Gas -- 3.1%
Questar Corp.,
5.820%, due 11/03/95................. 2,000,000 1,999,353
------------
Packaging -- 3.1%
Rexam PLC,#,+
5.730%, due 11/10/95 2,000,000 1,997,135
------------
<CAPTION>
Issuer Value
- -------------------------------------- ------------
<S> <C> <C>
TOTAL COMMERCIAL PAPER
(Cost $17,234,780)................... $ 17,234,780
------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $17,298,452)................... 17,298,452
------------
TOTAL INVESTMENTS
(COST $55,268,732)................... 95.1% $ 62,144,814
=============
- ----
ADR = American Depository Receipt.
# = Security may only be sold to qualified institutional
buyers.
* = Non-Income producing.
+ = Security is segregated for futures collateral.
</TABLE>
PURCHASED INDEX FUTURES OUTSTANDING
<TABLE>
<CAPTION>
Number Original Nominal Unrealized
Expiration of Nominal Value at Appreciation
Description Date Contracts Value 10/31/95 (Depreciation)
- --------------------------------------------------- ---------- ---------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Russell 2000 Future................................ 12/14/95 30 $4,717,742 $4,440,000 ($277,742)
</TABLE>
See notes to financial statements.
15
<PAGE> 98
VISTA MUTUAL FUNDS
STATEMENT OF ASSETS AND LIABILITIES October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista Vista Vista Vista
U.S. Government Balanced Equity Income Small Cap
Income Fund Fund Fund Equity Fund
--------------- --------------- -------------- --------------
<S> <C> <C> <C> <C>
ASSETS:
Investment securities, at value (Note 1)........ $ 107,786,591 $ 39,853,325 $ 11,714,958 $ 62,144,814
Cash............................................ -- -- -- 6,326
Receivables:
Investment securities sold.................... 6,717,073 149,845 75,254 2,509,999
Interest...................................... 2,241,288 173,417 21,071 13,742
Dividends..................................... -- 17,240 13,033 6,350
Trust shares sold............................. 139,578 71,645 48,976 1,000,096
Expense reimbursement from Distributor........ -- 11,087 -- --
Unamortized organization expenses (Note 1)...... -- -- -- 30,051
--------------- --------------- -------------- --------------
Total Assets................................ 116,884,530 40,276,559 11,873,292 65,711,378
--------------- --------------- -------------- --------------
LIABILITIES:
Payable for investment securities purchased..... -- -- 22,000 --
Payable for Trust shares redeemed............... 54,340 36,873 44,244 84,869
Payable to custodian............................ 6,717,546 61,386 721 --
Dividends payable............................... 187,834 -- -- --
Variation margin payable on futures contracts... -- -- -- 16,500
Accrued liabilities: (Note 2)
Administration fees........................... 3,729 -- 202 --
Distribution fees............................. 23,457 8,900 2,021 19,964
Investment advisory fees...................... 12,118 -- 808 --
Shareholder servicing fees.................... 6,411 2,557 -- 4,235
Sub-administration fees....................... 4,664 -- 505 1,764
Custodian..................................... -- 14,605 4,335 16,597
Organizational costs payable.................. -- -- -- 36,343
Other......................................... 112,570 83,706 61,291 167,812
--------------- --------------- -------------- --------------
Total Liabilities........................... 7,122,669 208,027 136,127 348,084
--------------- --------------- -------------- --------------
NET ASSETS:
Paid in capital................................. 113,417,489 36,517,465 9,639,823 57,768,327
Accumulated undistributed net investment income
(loss)........................................ (75,982) -- 26,635 --
Accumulated undistributed net realized gain
(loss) on investment transactions............. (6,524,260) 995,554 736,186 996,627
Net unrealized appreciation of investments and
futures....................................... 2,944,614 2,555,513 1,334,521 6,598,340
--------------- --------------- -------------- --------------
Net Assets:................................. $ 109,761,861 $ 40,068,532 $ 11,737,165 $ 65,363,294
================== ============= ================ =============
Class A Shares.............................. $ 99,109,225 $ 33,732,839 $ 43,739,400
================== ============= =============
Class B Shares.............................. $ 10,652,636 $ 6,335,693 $ 21,623,894
================== ============= =============
Shares of beneficial interest outstanding (no
par value; unlimited number of shares
authorized):
Class A Shares.............................. 8,691,408 2,710,359 876,263 2,902,211
================== ============= ================ =============
Class B Shares.............................. 936,734 512,572 1,440,738
================== ============= =============
Class A Shares:
Net asset value and redemption price per share
(net assets/shares outstanding):.............. $11.40 $12.45 $13.39 $15.07
================== ============= ================ =============
Maximum offering price per share (net asset
value per share/95.5%; 95.25% for SCE)........ $11.94 $13.04 $14.02 $15.82
================== ============= ================ =============
Class B Shares:
Net asset value and offering price per share
(net assets/shares outstanding)............... $11.37 $12.36 $15.01
================== ============= =============
Cost of Investments.............................. $ 104,841,977 $ 37,297,812 $ 10,380,437 $ 55,268,732
================== ============= ================ =============
</TABLE>
See notes to financial statements.
16
<PAGE> 99
VISTA MUTUAL FUNDS
STATEMENT OF OPERATIONS
For the year ended October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista Vista Vista
U.S. Vista Equity Small Cap
Government Balanced Income Equity
Income Fund Fund Fund Fund*
------------ ----------- ----------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME: (Note 1C)
Interest........................................... $ 7,703,751 $ 1,027,055 $ 171,162 $ 310,044
Dividend........................................... -- 291,935 306,505 97,606
------------ ----------- ----------- -----------
Total investment income........................ 7,703,751 1,318,990 477,667 407,650
------------ ----------- ----------- -----------
EXPENSES: (Note 2)
Shareholder servicing fees:
Class A Shares................................... 246,262 60,657 27,673 --
Class B Shares................................... 20,159 11,984 -- 14,887
Distribution fees:
Class A Shares................................... 246,262 60,657 27,673 35,265
Class B Shares................................... 60,477 35,952 -- 44,661
Investment Advisory fees........................... 319,705 145,295 44,277 130,401
Administration fees................................ 106,569 29,053 11,069 20,040
Sub-adminstration fees............................. 53,284 14,527 5,535 10,030
Custodian fees..................................... 54,465 53,483 22,660 38,556
Amortization of organization costs................. -- -- -- 6,292
Printing and postage............................... 20,488 6,001 80 5,195
Professional fees.................................. 39,818 46,462 15,581 33,922
Registration costs................................. 46,822 28,048 15,878 59,579
Transfer agent fees................................ 273,817 147,704 65,824 150,870
Trustees fees...................................... 5,839 1,582 606 1,021
Other.............................................. 35,471 24,044 5,971 22,753
------------ ----------- ----------- -----------
Total expenses................................. 1,529,438 665,449 242,827 573,472
Less amounts waived (Note 2E)........................ 543,343 249,525 76,787 162,875
Less expenses borne by the Distributor............... -- 71,666 -- 61,166
------------ ----------- ----------- -----------
Net expenses....................................... 986,095 344,258 166,040 349,431
------------ ----------- ----------- -----------
Net investment income................................ 6,717,656 974,732 311,627 58,219
------------ ----------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on:
Investments........................................ (3,754,673) 1,024,866 737,043 1,003,383
Written options transactions....................... 1,552 -- -- --
------------ ----------- ----------- -----------
Net realized gain (loss)............................. (3,753,121) 1,024,866 737,043 1,003,383
------------ ----------- ----------- -----------
Change in net unrealized appreciation/depreciation
on:
Investments........................................ 11,426,144 2,769,570 778,380 6,876,082
Futures transactions............................... -- -- -- (277,742)
------------ ----------- ----------- -----------
Change in net unrealized appreciation/depreciation... 11,426,144 2,769,570 778,380 6,598,340
------------ ----------- ----------- -----------
Net realized and unrealized gain..................... 7,673,023 3,794,436 1,515,423 7,601,723
------------ ----------- ----------- -----------
Net increase in net assets from operations........... $ 14,390,679 $ 4,769,168 $ 1,827,050 $ 7,659,942
=========== ========== ========== ==========
</TABLE>
- ---------------
* Commenced operations 12/20/94.
See notes to financial statements.
17
<PAGE> 100
VISTA MUTUAL FUNDS
STATEMENTS OF CHANGES IN NET ASSETS For the periods indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista
Vista Vista Vista Small Cap
U.S. Government Balanced Equity Income Equity
Income Fund Fund Fund Fund
----------------------------- --------------------------- --------------------------- ------------
Year Year Year Year Year Year 12/20/94*
ended ended ended ended ended ended through
10/31/95 10/31/94 10/31/95 10/31/94 10/31/95 10/31/94 10/31/95
------------- ------------- ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN
NET ASSETS
FROM OPERATIONS:
Net investment
income............. $ 6,717,656 $ 6,711,611 $ 974,732 $ 652,550 $ 311,627 $ 304,328 $ 58,219
Net realized gain
(loss) on
investments and
written options
transactions....... (3,753,121) (2,710,157) 1,024,866 308,991 737,043 364,377 1,003,383
Change in net
unrealized
appreciation/
depreciation on
investments and
futures............ 11,426,144 (10,555,085) 2,769,570 (592,331) 778,380 (947,688) 6,598,340
------------- ------------- ------------ ------------ ------------ ------------ ------------
Increase
(decrease) in
net assets from
operations..... 14,390,679 (6,553,631) 4,769,168 369,210 1,827,050 (278,983) 7,659,942
------------- ------------- ------------ ------------ ------------ ------------ ------------
NET EQUALIZATION
CREDITS (DEBITS)
(Note 1G):............ (20,821) 27,204 20,792 46,160 (4,769) (8,014) 43,982
------------- ------------- ------------ ------------ ------------ ------------ ------------
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS FROM
(Note 1H):
Net Investment
Income:
Class A............ (6,221,262) (6,558,156) (842,171) (620,855) (325,585) (265,990) (41,658)
Class B............ (474,068) (180,675) (144,259) (48,796) -- -- (16,561)
Net Realized Gain on
Investment
Transactions:
Class A............ -- (2,076,897) (257,809) (147,844) (365,232) (1,431,259) (4,461)
Class B............ -- (17,896) (44,501) -- -- -- (2,295)
------------- ------------- ------------ ------------ ------------ ------------ ------------
Total dividends
and
distributions... (6,695,330) (8,833,624) (1,288,740) (817,495) (690,817) (1,697,249) (64,975)
------------- ------------- ------------ ------------ ------------ ------------ ------------
TRANSACTIONS IN SHARES
OF BENEFICIAL
INTEREST:
Proceeds from shares
sold:
Class A Shares..... 18,943,386 64,615,107 13,619,762 11,120,402 1,418,840 3,105,266 40,671,733
Class B Shares..... 6,947,722 7,719,324 2,522,739 3,634,827 -- -- 19,979,829
Reinvestment of
distributions:
Class A Shares..... 3,953,641 7,514,916 1,074,605 746,177 576,869 1,422,588 43,355
Class B Shares..... 385,208 166,077 180,001 48,635 -- -- 17,854
Payment for shares
redeemed:
Class A Shares..... (30,405,442) (50,645,632) (5,578,221) (3,662,728) (2,798,836) (6,456,083) (2,447,710)
Class B Shares..... (2,445,068) (2,341,044) (498,972) (157,807) -- -- (540,716)
------------- ------------- ------------ ------------ ------------ ------------ ------------
Net increase
(decrease) in
net assets from
shares of
beneficial
interest
transactions... (2,620,553) 27,028,748 11,319,914 11,729,506 (803,127) (1,928,229) 57,724,345
------------- ------------- ------------ ------------ ------------ ------------ ------------
Total increase
(decrease)..... 5,053,975 11,668,697 14,821,134 11,327,381 328,337 (3,912,475) 65,363,294
NET ASSETS:
Beginning of period... 104,707,886 93,039,189 25,247,398 13,920,017 11,408,828 15,321,303 --
------------- ------------- ------------ ------------ ------------ ------------ ------------
End of period......... $ 109,761,861 $ 104,707,886 $ 40,068,532 $ 25,247,398 $ 11,737,165 $ 11,408,828 $ 65,363,294
============== ============== ============ ============ ============ ============ ============
</TABLE>
- ---------------
* Commencement of operations.
See notes to financial statements.
18
<PAGE> 101
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995
- --------------------------------------------------------------------------------
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES -- Mutual Fund Group (the
"Trust") was organized on May 11, 1987, as a Massachusetts business trust, and
is registered under the Investment Company Act of 1940, as amended, (the "1940
Act") as an open-end, non-diversified management investment company. Vista U.S.
Government Income Fund ("USGI"), Vista Balanced Fund ("BAL"), Vista Equity
Income Fund ("EQI") and Vista Small Cap Equity Fund ("SCE") which commenced
operations on December 20, 1994, (collectively, the "Funds") are four separate
portfolios of the Trust.
The USGI, VBF and SCE Funds offer two classes of shares; referred to as Class A
Shares and Class B Shares. Class A shares generally provide for a front-end
sales charge while Class B shares provide for a contingent deferred sales
charge. All classes of shares have equal rights as to earnings, assets and
voting privileges except that each class may bear different distribution fees
and each class has exclusive voting rights with respect to its distribution
plan.
The following is a summary of significant accounting policies followed by
the Funds:
A. Valuation of investments -- Equity securities listed on a securities
exchange or reported through the NASDAQ National Market system are valued
at the last reported sale price on the principal exchange on the date of
valuation. Securities for which sale prices are not available and other
over-the-counter securities are valued at last quoted bid price. Bonds and
other fixed income securities (other than short-term obligations),
including listed issues, are valued using matrix pricing systems of a major
dealer in bonds which take into account factors such as institutional-size
trading in similar groups of securities, yield, quality, coupon rate,
maturity, type of issue, trading characteristics and other market data,
without exclusive reliance upon quoted exchange or over-the-counter prices.
Short-term debt securities with 61 days or more to maturity at time of
purchase are valued, through the 61st day prior to maturity, at market
value based on quotations obtained from market makers or other appropriate
sources; thereafter, the value on the 61st day is amortized on a straight-
line basis over the remaining number of days to maturity. Short-term
investments with 60 days or less to maturity at time of purchase are valued
at amortized cost, which approximates market.
B. Repurchase agreements -- It is the Trust's policy that repurchase
agreements are fully collateralized by U.S. Treasury and Government agency
securities. All collateral is held by the Trust's custodian bank,
sub-custodian or a bank with which the custodian bank has entered into a
sub-custodian agreement or is segregated in the Federal Reserve Book Entry
System. In connection with transactions in repurchase agreements, if the
seller defaults and the value of the collateral declines, or if the seller
enters into an insolvency proceeding, realization of the collateral by the
Trust may be delayed or limited.
C. Futures Contracts -- When a fund enters into a futures contract, it
makes an initial margin deposit in a segregated account, either in cash or
liquid securities. Thereafter, the futures contract is marked to market and
the fund makes (or receives) additional cash payments daily to the broker.
Changes in the value of the contract are recorded as unrealized
appreciation/depreciation until the contract is closed or settled.
The Small Cap Equity Fund invests in stock index futures contracts, for the
purpose of hedging the Fund against share price volatility, which purpose
may or may not be achieved. When the Fund is not fully invested in the
securities market, and a significant market advance is expected, it may
enter into "long" positions in futures or options contracts in order to
gain rapid market exposure that may in part or entirely offset increases in
the cost of securities intended for purchase. Use of futures
19
<PAGE> 102
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
contracts subject the Fund to risk of loss in excess of amounts shown on
the Statement of Assets and Liabilities, up to the amount of the value of
the futures contract, as shown in the Portfolio of Investments at October
31, 1995.
The Fund may enter into futures contracts only on exchanges or boards of
trade. The exchange or board of trade acts as the counterparty to each
futures transaction, therefore, the Fund's credit risk is limited to
failure of the exchange or board of trade.
D. Written options -- When a fund writes an option on a futures contract,
an amount equal to the premium received by the fund is included in the
fund's Statement of Assets and Liabilities as an asset and corresponding
liability. The amount of the liability is adjusted daily to reflect the
current market value of the written options and the change is recorded in a
corresponding unrealized gain or loss account. When a written option
expires on its stipulated expiration date, or when a closing transaction is
entered into, the related liability is extinguished and the fund realizes a
gain (or loss if the cost of the closing transaction exceeds the premium
received when the option was written).
The fund writes options on futures on stock index and U.S. Treasury
securities futures. These options are settled for cash and subject the fund
to market risk in excess of the amounts that are reflected in the Statement
of Assets and Liabilities. The fund, however, is not subject to credit risk
on written options as the counterparty has already performed its obligation
by paying a premium at the inception of the contract.
As of October 31, 1995, the Funds had no outstanding written options.
E. Security transactions and investment income -- Investment transactions
are accounted for on the trade date (the date the order to buy or sell is
executed). Securities gains and losses are calculated on the identified
cost basis. Interest income is determined on the basis of coupon interest
accrued, adjusted for amortization of premiums, except USGI, and accretion
of discount. Dividend income is recorded on the ex-dividend date.
F. Federal income taxes -- Each Fund is treated as a separate taxable
entity for Federal income tax purposes. The Trust's policy is to comply
with the provisions of the Internal Revenue Code applicable to regulated
investment companies and to distribute to shareholders all of its
distributable net investment income, and net realized gain on investments.
In addition, the Trust intends to make distributions as required to avoid
excise taxes. Accordingly, no provision for Federal income or excise tax is
necessary.
G. Equalization -- The Funds follow the accounting practice known as
equalization by which a portion of the proceeds from sales and costs of
redemptions of Trust shares of beneficial interest equivalent, on a
per-share basis, to the amount of undistributed net investment income on
the date of the transactions, is credited or charged to undistributed net
investment income. As a result, undistributed net investment income per
share is unaffected by sales or redemptions of Trust shares.
H. Distributions to shareholders -- Dividends and Distributions paid to
shareholders are recorded on the ex-dividend date. The amount of dividends
and distributions from net investment income and net realized capital gains
is determined in accordance with federal income tax regulations, which may
differ from generally accepted accounting principles. To the extent these
"book/tax" differences are permanent in nature (i.e., that they result from
other than timing of recognition -- "temporary differences") such amounts
are reclassified within the capital accounts based on their
20
<PAGE> 103
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
federal tax-basis treatment. Dividends and distributions which exceed net
investment income or net realized capital gains for financial reporting
purposes but not for tax purposes are reported as distributions in excess
of net investment income or net realized capital gains. The
reclassifications for the Funds are as follows: USGI paid in capital was
decreased and accumulated undistributed net investment income was increased
by $20,821; BAL paid in capital was increased by $20,792, accumulated
undistributed net investment income and accumulated undistributed net
realized gain/loss were decreased by $9,904 and $11,698, respectively; EQI
paid in capital was decreased and accumulated undistributed net investment
income was increased by $4,769; SCE paid in capital was increased and
accumulated undistributed net investment income was decreased by $43,892.
The adjustments for the Funds relate primarily to the character for tax
purposes of equalization and certain short-term gains or losses.
I. Allocation of income and expenses -- Expenses directly attributable to
a Fund are charged to that Fund; other expenses of the Trust are allocated
proportionately among each of the Funds within the Trust in relation to the
net assets of each Fund or on another reasonable basis. Expenses directly
attributable to a particular class are charged directly to such class. In
calculating net asset value per share of each class, investment income,
realized and unrealized gains and losses and expenses other than class
specific expenses are allocated daily to each class of shares based upon
the proportion of net assets of each class at the beginning of each day.
J. Organization Costs -- Organization and initial registration costs
incurred in connection with establishing the Small Cap Equity Fund have
been deferred and are being amortized on a straight line basis over a
sixty-month period beginning at the commencement of operations of the Fund.
Organization costs payable are owed to the Fund's Distributor.
2. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A. Investment advisory fee -- Pursuant to separate Investment Advisory
Agreements, The Chase Manhattan Bank, N.A. ("Chase") acts as the investment
adviser to the Funds. Chase is a direct wholly-owned subsidiary of The
Chase Manhattan Corporation. As investment adviser, Chase supervises the
investments of the Funds and for such services is paid a fee. The fee is
accrued daily and paid monthly at an annual rate equal to 0.50% of the
Fund's average daily net assets for BAL, 0.65% for SCE, 0.40% for EQI and
0.30% for USGI. The Adviser voluntarily waived all or a portion of its fees
as outlined in Note 2.E. below.
B. Shareholder servicing fees -- The Trust has adopted an Administrative
Services Plan which, among other things, provides that the Trust on behalf
of the Funds, with the exception of Class A Shares of SCE, may obtain the
services of one or more Shareholder Servicing Agents. For its services,
each Shareholder Servicing Agent will receive fees determined by a formula
based upon the average number of accounts serviced and the number of
transactions processed by such Shareholder Servicing Agent during the
period for which payment is being made, and any out-of-pocket expenses
incurred, provided that such fees will not exceed, on an annualized basis,
0.25% of the average daily net assets of each Fund.
21
<PAGE> 104
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
Since inception of the Funds, Chase, and certain affiliates have been the
only Shareholder Servicing Agents of the Funds. The Shareholder Servicing
Agents have voluntarily waived a portion of their fees as outlined in Note
2.E. below.
C. Distribution and Sub-administration fees -- Pursuant to a Distribution
and Sub-administration Agreement, Vista Broker-Dealer Services, Inc.
("VBDS" or the "Distributor"), a wholly-owned subsidiary of Concord Holding
Corp. (a wholly-owned subsidiary of the BISYS Group, Inc.), acts as the
Trust's exclusive underwriter and promotes and arranges for the sale of
each Fund's shares. In addition, the Distributor provides certain
sub-administration services to the Trust, including providing officers,
clerical staff and office space for an annual fee of 0.05% of the average
daily net assets of each Fund.
The Trustees have adopted Distribution Plans (the "Distribution Plans") for
Class A for all Funds and Class B for USGI, BAL and SCE in accordance with
Rule 12b-1 under the 1940 Act.
The Class A Distribution Plans provide that each Fund shall pay
distribution fees, including payments to the Distributor, at annual rates
not to exceed 0.20% of each Fund's average daily net assets for
distribution services. The Class B Distribution Plans provide that each
Fund shall pay distribution fees, including payments to the Distributor, at
an annual rate not to exceed 0.75% of each Fund's average annual net assets
for distribution services.
Under Class A Distribution Plans, the Class A shares are also permitted to
pay an additional fee at an annual rate not to exceed 0.05% of its average
daily net assets in anticipation of, or as reimbursement for, expenses
incurred in connection with print or electronic media advertising in
connection with the sale of Fund shares. When such expenses are incurred,
the maximum compensation paid by the Class A shares under the Class A
Distribution Plan would be at an annual rate of 0.25% of its average daily
net assets.
The Distributor voluntarily waived all or a portion of distribution fees
and sub-administration fees as outlined in Note 2.E. below.
D. Administration fee -- Pursuant to an Administration Agreement, Chase
(the "Administrator") provides certain administration services to the
Trust. For these services and facilities, the Administrator receives from
each Fund a fee computed at the annual rate equal to 0.10% of the
respective Fund's average daily net assets. The Administrator voluntarily
waived all or a portion of administration fees as outlined in Note 2.E.
below.
E. Waivers of fees -- For the year ended October 31, 1995, the Adviser,
Distributor, Shareholder Servicing Agents, Administrator and
Sub-administrator voluntarily waived fees for certain of the Funds as
follows:
<TABLE>
<CAPTION>
USGI BAL EQI SCE
--------- --------- -------- ---------
<S> <C> <C> <C> <C>
Advisory........................................... $220,998 $145,295 $35,433 $130,401
Shareholder Servicing.............................. 197,001 48,520 26,964 --
Distribution....................................... 49,250 12,130 5,535 8,946
Administration..................................... 76,094 29,053 8,855 20,040
Sub-administration................................. -- 14,527 -- 3,488
--------- --------- -------- ---------
Total.............................................. $543,343 $249,525 $76,787 $162,875
--------- --------- -------- ---------
</TABLE>
22
<PAGE> 105
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
In addition, the Distributor reimbursed expenses of BAL and SCE of $71,666
and $61,166, respectively.
F. Other -- Certain officers of the Trust are officers of VBDS or of its
parent corporation, BISYS.
Chase provides portfolio accounting and custody services for the Funds.
Compensation for such services are presented in the Statement of Operations
as custodian fees.
On August 27, 1995, the Chase Manhattan Corporation and Chemical Banking
Corporation announced an agreement in principle to merge, which was
approved by shareholders of both corporations on December 11, 1995, subject
to the approval of regulators.
3. INVESTMENT TRANSACTIONS -- Purchases and sales of investments (excluding
short-term investments) were as follows:
<TABLE>
<CAPTION>
USGI BAL EQI SCE
------------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Purchases (excluding U.S.
Government)...................... -- $ 13,471,256 $ 9,426,412 $ 49,697,994
Sales (excluding U.S.
Government)...................... -- 10,712,213 10,245,827 12,731,096
Purchases of U.S. Government....... $ 163,831,712 6,107,075 -- --
Sales of U.S. Government........... 171,359,416 4,913,203 -- --
</TABLE>
Written option transactions:
<TABLE>
<CAPTION>
USGI
---------------------
Number of Premiums
Calls Contracts Received
- ---------------------------------------------------------------------- --------- --------
<S> <C> <C>
Options outstanding at 10/31/94....................................... -- --
Options written....................................................... 20 $ 14,526
Options terminated in closing purchase transactions................... 20 (14,526)
-- ---------
Options outstanding at 10/31/95....................................... -- --
======== =========
</TABLE>
4. FEDERAL INCOME TAX MATTERS -- For Federal income tax purposes, the cost and
unrealized appreciation/(depreciation) in value of the investment securities at
October 31, 1995 are as follows:
<TABLE>
<CAPTION>
USGI BAL EQI SCE
------------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Aggregate cost..................... $ 104,841,977 $ 37,297,812 $ 10,380,437 $ 55,268,732
============= ============ ============ ============
Gross unrealized appreciation...... $ 2,993,067 $ 3,028,038 $ 1,518,878 $ 7,869,134
Gross unrealized depreciation...... (48,453) (472,525) (184,357) (993,052)
------------- ------------ ------------ ------------
Net unrealized appreciation........ $ 2,944,614 $ 2,555,513 $ 1,334,521 $ 6,876,082
============= ============ ============ ============
</TABLE>
At October 31, 1995 the USGI had a net capital loss carryover of approximately
$6,524,000. Such losses of approximately $2,759,000 and $3,765,000 will be
available to offset capital gains arising through October 31, 2002 and October
31, 2003, respectively. To the extent that any net capital loss carryover is
used to offset future capital gains, it is probable that the gains so offset
will not be distributed to shareholders.
23
<PAGE> 106
VISTA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
5. TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST -- Transactions in Shares of
Beneficial Interest were as follows:
<TABLE>
<CAPTION>
USGI BAL EQI SCE
------------------------- --------------------- --------------------- ----------
Year Year Year Year Year Year 12/20/94*
ended ended ended ended ended ended through
10/31/95 10/31/94 10/31/95 10/31/94 10/31/95 10/31/94 10/31/95
----------- ----------- --------- --------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Class A
Shares sold........... 1,726,543 5,545,433 1,147,533 998,851 117,176 249,225 3,072,528
Shares issued in
reinvestment of
distributions....... 360,648 665,821 94,732 67,659 49,758 115,420 3,317
Shares redeemed....... (2,780,887) (4,512,861) (489,732) (332,016) (231,862) (530,759) (173,634 )
----------- ----------- --------- --------- --------- --------- ----------
Net increase
(decrease) in Trust
shares
outstanding......... (693,696) 1,698,393 752,533 734,494 (64,928) (166,114) 2,902,211
Outstanding shares at:
Beginning of
period............ 9,385,104 7,686,711 1,957,826 1,223,332 941,191 1,107,305 --
----------- ----------- --------- --------- --------- --------- ----------
End of period....... 8,691,408 9,385,104 2,710,359 1,957,826 876,263 941,191 2,902,211
========= ========= ======== ======== ======== ======== =========
</TABLE>
<TABLE>
<CAPTION>
Year 11/5/93** Year 11/4/93* 03/28/95**
ended through ended through through
10/31/95 10/31/94 10/31/95 10/31/94 4/30/95
----------- ----------- --------- --------- ----------
<S> <C> <C> <C> <C> <C>
Class B
Shares sold........... 636,178 687,819 219,604 331,302 1,477,956
Shares issued in
reinvestment of
distributions....... 35,054 15,107 15,917 4,462 1,358
Shares redeemed....... (223,952) (213,472) (44,230) (14,483) (38,576)
----------- ----------- --------- --------- ----------
Net increase in Trust
shares
outstanding......... 447,280 489,454 191,291 321,281 1,440,738
Outstanding shares at:
Beginning of
period............ 489,454 -- 321,281 -- --
----------- ----------- --------- --------- ----------
End of period....... 936,734 489,454 512,572 321,281 1,440,738
========= ========= ======== ======== =========
</TABLE>
- ---------------
* Commencement of operations.
** Commencement of offering class of shares.
6. RETIREMENT PLAN -- During the year ended October 31, 1995, the Trust
adopted an unfunded noncontributory defined benefit pension plan covering all
independent directors of the Trust who have served as an independent director of
the Trust, or other Vista Funds, for at least five years at the time of
retirement. Benefits under this plan are based on compensation and years of
service. Management has determined that the accrual for prior service costs is
not material.
24
<PAGE> 107
VISTA MUTUAL FUNDS
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OF BENEFICIAL INTEREST
OUTSTANDING
Throughout each period indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista U.S. Government Income Fund --
-----------------------------------------------------------------------------------------
Class A
------------------------------------------------------------ Class B
-----------------------
Year ended Year 11/4/93**
------------------------------------------------------------ ended through
10/31/95 10/31/94 10/31/93 10/31/92 10/31/91 10/31/95 10/31/94
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of
Period.............................. $ 10.60 $ 12.10 $ 11.68 $ 11.53 $ 10.93 $ 10.59 $ 11.98
-------- -------- -------- -------- -------- -------- --------
Income From Investment Operations
Net Investment Income............. 0.699 0.646 0.666 0.786 0.883 0.621 0.592
Net Gains/(Losses) on Securities
(both realized and unrealized)... 0.798 (1.297) 0.699 0.267 0.597 0.797 (1.187)
-------- -------- -------- -------- -------- -------- --------
Total from Investment
Operations....................... 1.497 (0.651) 1.365 1.053 1.480 1.418 (0.595)
-------- -------- -------- -------- -------- -------- --------
Less Distributions
Dividends from net investment
income........................... 0.697 0.646 0.667 0.786 0.882 0.638 0.592
Distributions from capital
gains............................ -- 0.203 0.287 0.111 -- -- 0.203
-------- -------- -------- -------- -------- -------- --------
Total Distributions............... 0.697 0.849 0.954 0.897 0.882 0.638 0.795
-------- -------- -------- -------- -------- -------- --------
Net Asset Value, End of Period....... $ 11.40 $ 10.60 $ 12.10 $ 11.68 $ 11.53 $ 11.37 $ 10.59
======== ======== ======== ======== ======== ======== ========
Total Return (1)..................... 14.59% (5.58%) 12.35% 9.40% 14.07% 13.80% (5.18%)
Ratios/Supplemental Data
Net Assets, End of Period (000
omitted).......................... $ 99,109 $ 99,524 $ 93,039 $ 59,391 $ 15,131 $ 10,652 $ 5,184
Ratio of Expenses to Average Net
Assets #.......................... 0.87% 0.76% 0.75% 0.38% 0.02% 1.62% 1.50%
Ratio of Net Investment Income to
Average Net Assets #.............. 6.37% 5.74% 5.61% 6.52% 7.81% 5.53% 5.28%
Ratio of expenses without waivers
and assumption of expenses to
Average Net Assets #.............. 1.40% 1.28% 1.14% 1.34% 2.89% 1.89% 1.78%
Ratio of net investment income
without waivers and assumption of
expenses to Average Net
Assets #.......................... 5.84% 5.22% 5.22% 5.56% 4.94% 5.26% 5.00%
Portfolio Turnover Rate.............. 164% 163% 296% 514% 103% 164% 163%
</TABLE>
- ---------------
(1) Total return figures do not include the effect of any sales load.
** Commencement of offering of class of shares.
# Short periods have been annualized.
See notes to financial statements.
25
<PAGE> 108
VISTA MUTUAL FUNDS
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OF BENEFICIAL INTEREST
OUTSTANDING
Throughout each period indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Vista Equity Income
Vista Balanced Fund -- Class A Vista Balanced Fund
-------------------------------- Fund -- Class B --------------------
------------------
Year ended 11/4/92* Year 11/4/93** Year ended
-------------------- through ended through --------------------
10/31/95 10/31/94 10/31/93 10/31/95 10/31/94 10/31/95 10/31/94
-------- -------- -------- ------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of Period........... $ 11.09 $ 11.38 $ 10.00 $ 11.03 $ 11.22 $ 12.12 $ 13.84
-------- -------- -------- ------- ------- -------- --------
Income From Investment Operations
Net Investment Income....................... 0.382 0.356 0.410 0.309 0.345 0.347 0.290
Net Gains/(Losses) on Securities (both
realized and unrealized).................. 1.517 (0.187) 1.344 1.502 (0.117) 1.698 (0.477)
-------- -------- -------- ------- ------- -------- --------
Total from Investment Operations............ 1.899 0.169 1.754 1.811 0.228 2.045 (0.187)
-------- -------- -------- ------- ------- -------- --------
Less Distributions
Dividends from net investment income........ 0.408 0.359 0.375 0.131 0.318 0.366 0.258
Distributions from capital gains............ 0.131 0.100 -- 0.350 0.100 0.410 1.275
-------- -------- -------- ------- ------- -------- --------
Total Distributions......................... 0.539 0.459 0.375 0.481 0.418 0.776 1.533
-------- -------- -------- ------- ------- -------- --------
Net Asset Value, End of Period................. $ 12.45 $ 11.09 $ 11.38 $ 12.36 $ 11.03 $ 13.39 $ 12.12
========= ========= ========= ======= ======= ========= =========
Total Return (1)............................... 17.70% 1.56% 17.74% 16.93% 2.17% 17.97% (1.35%)
Ratios/Supplemental Data
Net Assets, End of Period (000 omitted)....... $ 33,733 $ 21,705 $ 13,920 $ 6,336 $ 3,543 $ 11,737 $ 11,409
Ratio of Expenses to Average Net Assets #..... 1.06% 0.58% -- 1.82% 1.50% 1.50% 1.50%
Ratio of Net Investment Income to Average Net
Assets #.................................... 3.48% 3.21% 3.87% 2.68% 2.46% 2.81% 2.31%
Ratio of expenses without waivers and
assumption of expense to Average Net Assets
#........................................... 2.20% 2.20% 3.07% 2.72% 2.69% 2.19% 2.02%
Ratio of net investment income without waivers
and assumption of expenses to Average Net
Assets #.................................... 2.34% 1.59% 0.80% 1.78% 1.24% 2.12% 1.79%
Portfolio Turnover Rate........................ 68% 77% 65% 68% 77% 91% 75%
<CAPTION>
Vista Equity
Income Vista Small Cap
Fund Equity Fund
-------- ---------------------
A Shares B Shares
7/15/93* 12/20/94* 3/28/95**
through through through
10/31/93 10/31/95 10/31/95+
-------- -------- --------
<S> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of Period........... $ 13.14 $ 10.00 $ 11.39
-------- -------- --------
Income From Investment Operations
Net Investment Income....................... 0.078 0.060 (0.018)
Net Gains/(Losses) on Securities (both
realized and unrealized).................. 0.700 5.056 3.669
-------- -------- --------
Total from Investment Operations............ 0.778 5.116 3.651
-------- -------- --------
Less Distributions
Dividends from net investment income........ 0.078 0.042 0.027
Distributions from capital gains............ -- 0.004 0.004
-------- -------- --------
Total Distributions......................... 0.078 0.046 0.031
-------- -------- --------
Net Asset Value, End of Period................. $ 13.84 $ 15.07 $ 15.01
========= ========= =========
Total Return (1)............................... 5.91% 51.25% 32.09%
Ratios/Supplemental Data
Net Assets, End of Period (000 omitted)....... $ 15,321 $ 43,739 $ 21,624
Ratio of Expenses to Average Net Assets #..... 1.50% 1.51% 2.24%
Ratio of Net Investment Income to Average Net
Assets #.................................... 1.72% 0.52% (0.25%)
Ratio of expenses without waivers and
assumption of expense to Average Net Assets
#........................................... 2.40% 2.67% 3.23%
Ratio of net investment income without waivers
and assumption of expenses to Average Net
Assets #.................................... 0.82% (0.64%) (1.24%)
Portfolio Turnover Rate........................ 54% 75% 75%
</TABLE>
- ---------------
# Short periods have been annualized.
(1) Total return figures do not include the effect of any sales load.
* Commencement of operations.
** Commencement of offering of class of shares.
+ Calculated based upon weighted average shares outstanding during the period.
See notes to financial statements.
26
<PAGE> 109
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE TRUSTEES
AND SHAREHOLDERS OF
MUTUAL FUND GROUP
In our opinion, the accompanying statement of assets and liabilities, including
the portfolios of investments, and the related statements of operations and of
changes in net assets and the selected per share data and ratios for a share of
beneficial interest outstanding present fairly, in all material respects, the
financial position of Vista U.S. Government Income Fund, Vista Balanced Fund,
Vista Equity Income Fund and Vista Small Cap Equity Fund, separate portfolios of
Mutual Fund Group (hereafter referred to as the "Trust"), at October 31, 1995,
the results of each of their operations for the year then ended (for the period
December 20, 1994 (commencement of operations) through October 31, 1995 for
Vista Small Cap Equity Fund), the changes in each of their net assets for each
of the two years in the period then ended (for the period December 20, 1994
through October 31, 1995 for Vista Small Cap Equity Fund) and the selected per
share data and ratios for a share of beneficial interest outstanding for each of
the periods presented, in conformity with generally accepted accounting
principles. These financial statements and selected per share data and ratios
for a share of beneficial interest outstanding (hereafter referred to as
"financial statements") are the responsibility of the Trust's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at October
31, 1995 by correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York 10036
December 11, 1995
27
<PAGE> 110
UNAUDITED
VISTA U.S. GOVERNMENT INCOME FUND
VISTA BALANCED FUND
VISTA EQUITY INCOME FUND
VISTA SMALL CAP EQUITY FUND
- --------------------------------------------------------------------------------
Certain tax information regarding the Vista Mutual Funds is required to be
provided to shareholders based upon the Funds income and distributions for the
taxable year ended October 31, 1995. The information and distributions reported
in this letter may differ from the information and distributions taxable to the
shareholders for the calendar year ending December 31, 1995. The information
necessary to complete your income tax returns for the calendar year ending
December 31, 1995 will be received under separate cover.
FOR THE FISCAL YEAR ENDED OCTOBER 31, 1995.
<TABLE>
<CAPTION>
Dividends Eligible
Long-term Capital for the Dividends
Gain Received
Distributions Deduction (for
Paid Per Share Corporations)
----------------- ------------------
<S> <C> <C>
U.S. Government Income Fund.......................... -- --
Balanced Fund........................................ $0.032 18.36%
Equity Income Fund................................... $0.361 66.52%
Small Cap Equity Fund................................ -- 8.16%
</TABLE>
The following represents the source and percentage of income earned from
government obligations by the Funds:
<TABLE>
<CAPTION>
Federal
Federal National
U.S. Treasury Home Loan Mortgage
Obligations Bank Assoc.
------------- --------- --------
<S> <C> <C> <C>
U.S. Government Income Fund......................... 95.67% -- --
Balanced Fund....................................... 18.43% -- 4.16%
Equity Income Fund.................................. -- -- --
Small Cap Equity Fund............................... 0.12% 1.00% --
</TABLE>
<PAGE> 111
(This page intentionally left blank.)
<PAGE> 112
(This page intentionally left blank.)
<PAGE> 113
VISTA FAMILY OF MUTUAL FUNDS
Vista offers a wide variety of professionally managed mutual funds that can
help you meet your financial goals. For a brochure and prospectus containing
more complete information on sales charges or expenses, contact your
investment representative or call 1-800-34-VISTA. Please read the prospectus
carefully before you invest or send money:
<TABLE>
<S> <C>
VISTA EQUITY FUNDS VISTA FIXED INCOME FUNDS
Growth and Income Fund U.S. Government Income Fund(2)
Capital Growth Fund Tax Free Income Fund
Small Cap Equity Fund New York Tax Free Income Fund
Equity Income Fund California Intermediate Tax Free Fund
Growth Fund of Washington(1)
VISTA MONEY MARKET FUNDS(2)
VISTA BALANCED FUND U.S. Government Money Market Fund
Balanced Fund Treasury Plus Money Market Fund
VISTA INTERNATIONAL FUNDS Tax Free Money Market Fund
Global Fixed Income Fund New York Tax Free Money Market Fund
International Equity Fund California Tax Free Money Market Fund
European Fund Global Money Market Fund
Japan Fund Federal Money Market Fund
Southeast Asian Fund Prime Money Market Fund
Select Shares of Connecticut Daily Tax Free
Income Fund(3)
Select Shares of New Jersey Daily Municipal
Income Fund(3)
</TABLE>
Vista Broker-Dealer Services, Inc. is the funds' distributor and is
unaffiliated with Chase. The Chase Manhattan Bank, N.A. is the funds'
portfolio adviser and provides other services to the funds.
(1) Washington Investment Advisors, Inc. is the fund's investment adviser.
(2) An investment in these funds is neither insured nor guaranteed by the U.S.
government, and there can be no assurance that these funds will be able to
maintain a stable Net Asset Value of $1.00 per share.
(3) Vista Select Shares of Connecticut Daily Tax Free Income Fund, Inc., and
Vista Select Shares of New Jersey Daily Municipal Income Fund, Inc., are
not part of, or affiliated with, the Vista Family of Mutual Funds. Reich &
Tang Distributors L.P. and New England Investment Companies L.P., which
are unaffiliated with Chase, are the funds' distributor and investment
adviser, respectively. National bank subsidiaries of The Chase Manhattan
Corporation do, however, perform shareholder servicing agent services for
the funds, although they perform no other services for the funds, such as
serving as investment adviser, custodian or administrator.
INVESTMENTS IN MUTUAL FUNDS ARE SUBJECT TO RISK, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL. IN ADDITION, THEY ARE NOT DEPOSITS, OBLIGATIONS OF, ENDORSED OR
GUARANTEED BY CHASE AND ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD
OR ANY OTHER GOVERNMENT AGENCY.
<PAGE> 114
[VISTA LOGO]
------------------------------
ANNUAL
------------------------------
REPORT
VISTA SERVICE CENTER
P.O. BOX 419392
KANSAS CITY, MO 64179
INVESTMENT ADVISER,
ADMINISTRATOR,
SHAREHOLDER SERVICING AGENT
AND CUSTODIAN
The Chase Manhattan Bank, N.A.
DISTRIBUTOR
Vista Broker-Dealer Services,
Inc.
TRANSFER AGENT
DST Systems, Inc.
LEGAL COUNSEL
Kramer, Levin, Naftalis, Nessen,
Kamin & Frankel
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
Vista Broker-Dealer Services,
Inc. is the funds' distributor
and is unaffiliated with Chase.
The Chase Manhattan Bank, N.A.
is the funds' adviser.
This report is submitted for the
general information of the
shareholders of the funds. It is
not authorized for distribution
to prospective investors in the
funds unless preceded or
accompanied by a prospectus. To
obtain a prospectus for any of
the Vista funds, call
1-800-34-VISTA. The prospectus
contains more complete
information, including charges
and expenses. Please read it
carefully before you invest
or send money.
For more information about these
funds or your account, simply
call your investment
representative or the Vista
Service Center at
1-800-34-VISTA.
VBEG-2
VISTA U.S.
GOVERNMENT
INCOME
FUND
VISTA
BALANCED
FUND
VISTA
EQUITY
INCOME
FUND
VISTA
SMALL CAP
EQUITY
FUND
FOR THE 12 MONTHS ENDED
OCTOBER 31, 1995
<PAGE> 115
---------------------------------------------------------------
VISTA(SM) FAMILY OF MUTUAL FUNDS CHAIRMAN'S LETTER
December 12, 1995
Dear Shareholder:
We are pleased to present this Annual Report for
the IEEE Balanced Fund for the fiscal year ended
October 31, 1995.
U.S. MARKETS ROAR TO LIFE IN 1995
The U.S. financial markets roared to life in
1995 as investors correctly anticipated that the
economy would undergo a "soft landing" on the heels
of the Fed's rate hikes in 1994. All in all, it was
an outstanding year for U.S. equity investors -- one
of the best of the past century, as indicated by the
Dow Jones Industrial Average. Bond investors also
fared well, with the yield on 30-year Treasury bonds
dropping from 7.96% to 6.32% over the 12-month
period, sending the value of bonds soaring.
STRONG STOCK AND BOND SELECTIONS BOOST INVESTMENT
RETURNS
The IEEE Balanced Fund performed well during the
period under review -- a result of both the positive
economic environment for the U.S. financial markets
and timely stock and bond selection decisions by the
fund managers. Given the sizeable gains in the U.S.
stock and bond markets during the past year, the
Fund's managers are cautiously optimistic about
these markets in the months ahead.
As always, we recommend that investors take a
long term, disciplined approach to the markets. By
leaving your money invested for the long term, you
are better able to ride out bumpy periods.
We value your business and look forward to
serving your investment needs in the years ahead.
Sincerely,
/s/ FERGUS REID
---------------
Fergus Reid
Chairman
INVESTMENTS IN MUTUAL FUNDS ARE SUBJECT TO RISK,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. IN
ADDITION, THEY ARE NOT DEPOSITS, OBLIGATIONS OF,
ENDORSED OR GUARANTEED BY CHASE, AND ARE NOT INSURED
BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENT AGENCY.
- -------------------------------------
CONTENTS
CHAIRMAN'S LETTER 1
FUND COMMENTARY 2
PORTFOLIO OF INVESTMENTS 3-6
FINANCIAL STATEMENTS 7-9
NOTES TO FINANCIAL
STATEMENTS 10-14
PER SHARE DATA 15
1
<PAGE> 116
---------------------------------------------------------------
FUND COMMENTARY
IEEE BALANCED FUND
We are pleased to report that the IEEE
Balanced Fund experienced a strong 19.93% total
return for the fiscal year ended October 31,
1995. A number of factors converged during the
past year to create a favorable environment for
both equity and bond investors. The stock market
performed positively throughout the period, as
the number of positive days during 1995 placed
the year among the 10 best of the past century.
The technology sector was a strong performer
during the third quarter of the period, while
the finance and utility sectors led the pack.
The fixed income markets were also
favorable last year, extending a rally that
began in November 1994. Despite some volatility
during the last quarter, long-term interest
rates ended the period approximately 1.75% below
their high from the previous year. We expect
Gross Domestic Product growth to remain at
approximately 2 1/2% to 3%, and inflation to
continue at or below 3%, which continues to
provide a favorable environment for bond
investing.
At fiscal year-end, the Fund's allocation
stood at 57% equities, 37% fixed income and 6%
cash equivalents. Starting in November we began
to add small-capitalization stocks to the
equity portion of the portfolio, which slightly
outperformed large-capitalization stocks in the
latest quarter. The remaining stocks are
diversified among well-established companies
with the potential for above-average growth.
Our strategy is to remain fully invested
in stocks of companies that we feel possess a
superior three- to five-year earnings outlook.
We continue to favor the capital investment,
information technology and globally-oriented
consumer product sectors as we expect favorable
business conditions for growth.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN
SINCE INCEPTION
1 YEAR (9/7/93)
----------- ----------------------
<S> <C>
19.93% 7.22%
---------------------------------------
</TABLE>
GROWTH OF $10,000
[GRAPH HERE]
<TABLE>
<CAPTION>
IEEE Balanced Fund Lipper Balanced Fund Index
<S> <C> <C>
09/30/93 10000 10000
10/31/93 10064.0419161676647 10098.51
11/30/93 9873.77644710578842 9939.12
12/31/93 10055.0293413173653 10119.64
01/31/94 10237.4794704944949 10385.11
02/28/94 10024.6209864545103 10172.18
03/31/94 9647.55738615510914 9793.53
04/30/94 9576.24492395544096 9820.39
05/31/94 9637.36989155515654 9890.07
06/30/94 9440.75124577607142 9713.35
07/31/94 9676.51376331445323 9938.75
08/31/94 9809.77083844484294 10182.99
09/30/94 9642.68696731981584 9990.09
10/31/94 9683.98327124838036 10025.66
11/30/94 9477.50175160555775 9785.45
12/31/94 9637.52492932874527 9867.28
01/31/95 9814.26486870154859 9988.03
02/28/95 10126.1588793594368 10278.25
03/31/95 10345.5243335221515 10457.81
04/30/95 10502.4331960123762 10650.07
05/31/95 10795.3297393274624 10994.25
06/30/95 11035.9233284791404 11191.74
07/31/95 11225.2909356408415 11429.29
08/31/95 11341.0155844618811 11517.95
09/30/95 11635.5874178245274 11794.88
10/31/95 11614.4318043375737 11766.82
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN
AND PRINCIPAL WILL FLUCTUATE WITH MARKET CONDITIONS. WHEN SHARES ARE REDEEMED,
THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
THIS CHART ILLUSTRATES COMPARATIVE PERFORMANCE FOR $10,000 INVESTED IN THE
IEEE BALANCED FUND AND THE 1994, LIPPER BALANCED FUND INDEX FROM SEPTEMBER 30,
1993 TO OCTOBER 31, 1995. THE FUND'S PERFORMANCE ASSUMES THE REINVESTMENT OF
ALL DIVIDENDS AND CAPITAL GAINS. THE INDEX'S PERFORMANCE HAS BEEN ADJUSTED TO
REFLECT REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS ON MUTUAL FUNDS
INCLUDED IN THE BENCHMARK.
THE LIPPER BALANCED FUND INDEX, AN EQUALLY-WEIGHTED PERFORMANCE INDICATOR,
TRACKS THE TOTAL RETURNS OF THE 30 LARGEST BALANCED FUNDS IN THE INDUSTRY.
FUNDS INCLUDED IN THE LIPPER BALANCED FUND INDEX ARE REPRESENTATIVE OF THE
MARKET.
- -------------------------------------------------------------------------------
2
<PAGE> 117
IEEE BALANCED FUND
PORTFOLIO OF INVESTMENTS October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ---------------------------------------- --------- -----------
<S> <C> <C>
LONG-TERM INVESTMENTS -- 91.8%
COMMON STOCK -- 57.1%
Aerospace -- 3.7%
Boeing Co. ............................. 2,900 $ 190,312
Loral Corp. ............................ 6,400 189,600
OEA, Inc. .............................. 400 10,900
---------
390,812
---------
Apparel -- 0.2%
Kellwood Co. ........................... 650 12,188
Phillips-Van Heusen..................... 600 6,075
---------
18,263
---------
Appliances & Household Durables -- 0.1%
La-Z-Boy Chair Co. ..................... 400 11,900
---------
Banking -- 0.8%
Deposit Guaranty Corp. ................. 300 13,350
First Commercial Corp. ................. 400 12,000
First Financial Corp. of Wisconsin...... 700 14,962
FirstMerit Corp. ....................... 400 10,800
Mark Twain Bancshares, Inc. ............ 300 10,575
U.S. Trust Corp. ....................... 200 9,700
Washington Federal, Inc. ............... 600 13,725
---------
85,112
---------
Business Products -- 1.4%
Pitney-Bowes, Inc. ..................... 3,400 148,325
---------
Business Services -- 1.8%
American Business Products, Inc. ....... 750 16,406
Equifax, Inc. .......................... 3,900 152,100
National Computer Systems, Inc. ........ 700 13,300
Standard Register Co. .................. 600 13,500
---------
195,306
---------
Chemicals -- 2.3%
Fuller (H.B.) Co. ...................... 300 9,450
Lilly Industries, Inc., Class A......... 900 11,475
Millipore Corp. ........................ 3,200 113,200
Nalco Chemical Co. ..................... 3,600 108,000
---------
242,125
---------
Computer Software -- 2.9%
Computer Associates International....... 1,500 82,500
Microsoft Corp.*........................ 2,300 230,000
---------
312,500
---------
Computers/Computer Hardware -- 0.4%
Fair Issac & Company, Inc. ............. 400 10,800
SCI Systems, Inc.*...................... 500 17,563
Stratus Computer, Inc.*................. 400 12,450
---------
40,813
---------
Construction Materials -- 0.3%
Carlisle Companies, Inc. ............... 300 12,337
Justin Industries....................... 1,100 11,000
Ply Gem Industries, Inc. ............... 700 12,075
---------
35,412
---------
<CAPTION>
Issuer Shares Value
- ---------------------------------------- --------- -----------
<S> <C> <C>
Consumer Products -- 2.3%
BIC Corp. .............................. 300 $ 12,075
Gillette Co. ........................... 2,500 120,937
Rubbermaid, Inc. ....................... 4,200 109,725
---------
242,737
---------
Diversified -- 2.3%
AMCOL International Corp. .............. 800 13,500
Dover Corp. ............................ 3,400 134,300
Lawson Products, Inc. .................. 400 9,600
Tyco International Ltd. ................ 1,400 85,050
---------
242,450
---------
Electronics / Electrical
Equipment -- 8.1%
AMP, Inc. .............................. 2,400 94,200
Dionex Corp.*........................... 300 16,200
General Electric Co. ................... 2,700 170,775
Grainger (W.W.), Inc. .................. 1,400 87,500
Hewlett-Packard Co. .................... 2,600 240,825
Logicon, Inc. .......................... 600 13,725
Molex, Inc. ............................ 1,718 56,694
Motorola, Inc. ......................... 1,300 85,313
MTS Systems Corp. ...................... 400 11,300
Park Electrochemical Corp. ............. 400 12,500
Pioneer Standard Electronics, Inc. ..... 750 10,406
Scientific-Atlanta, Inc. ............... 2,700 33,412
Teleflex, Inc. ......................... 300 12,713
Wyle Electronics........................ 400 17,050
X-Rite, Inc. ........................... 600 9,375
---------
871,988
---------
Engineering Services -- 0.5%
Foster Wheeler Corp. ................... 1,500 56,250
---------
Entertainment/Leisure -- 0.9%
Carnival Corp., Class A................. 4,000 93,000
---------
Environmental Services -- 1.2%
WMX Technologies, Inc. ................. 4,700 132,188
---------
Financial Services -- 0.4%
Eaton Vance Corp. ...................... 300 10,950
Legg Mason, Inc. ....................... 400 11,500
Quick & Reilly Group, Inc. ............. 450 10,688
Raymond James Financial, Inc. .......... 700 15,050
---------
48,188
---------
Food/Beverage Products -- 2.7%
Coca-Cola Co. .......................... 2,500 179,688
CPC International, Inc. ................ 1,300 86,288
International Multifoods Corp. ......... 600 12,300
J.M. Smucker Co., Class A............... 500 9,813
---------
288,089
---------
</TABLE>
See notes to financial statements.
3
<PAGE> 118
IEEE BALANCED FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Issuer Shares Value
- ---------------------------------------- --------- -----------
<S> <C> <C>
Health Care -- 3.4%
Biomet, Inc.*........................... 6,700 $ 111,388
Diagnostic Products Corp. .............. 300 11,100
Humana, Inc.*........................... 4,900 103,513
Life Technologies, Inc. ................ 600 14,700
Owens & Minor, Inc. .................... 600 7,125
Rotech Medical Corp. ................... 400 9,100
U.S. HealthCare, Inc. .................. 2,900 111,650
---------
368,576
---------
Industrial Services -- 0.1%
Unifirst Corp. ......................... 800 11,200
---------
Insurance -- 4.2%
American Bankers Insurance Group,
Inc. .................................. 350 12,556
American International Group............ 1,950 164,531
Crawford & Company, Class B............. 700 10,850
Frontier Insurance Group, Inc. ......... 500 14,313
Gainsco, Inc. .......................... 1,323 11,410
General Re Corp. ....................... 1,000 144,875
Liberty Corp. .......................... 400 13,400
Progressive Corp. ...................... 2,000 83,000
---------
454,935
---------
Leasing -- 0.1%
Rollins Truck Leasing Corp. ............ 1,100 10,588
---------
Machinery & Engineering
Equipment -- 0.1%
Precision Castparts Corp. .............. 400 14,300
---------
Manufacturing -- 1.4%
CLARCOR Inc. ........................... 500 11,375
Commercial Intertech Corp. ............. 700 11,812
Furon Co. .............................. 500 7,750
Graco, Inc. ............................ 500 16,812
Ingersoll-Rand Co. ..................... 1,300 45,987
Tennant Co. ............................ 400 9,900
Trinity Industries, Inc. ............... 1,600 47,400
---------
151,036
---------
Oil & Gas -- 0.1%
Production Operators Corp. ............. 400 12,000
---------
Packaging -- 0.1%
Sealright Company, Inc. ................ 600 6,750
---------
Pharmaceuticals -- 7.8%
Abbot Laboratories...................... 2,900 115,275
Alpharma, Inc., Class A................. 600 14,400
Johnson & Johnson....................... 1,600 130,400
Medtronic, Inc. ........................ 3,600 207,900
Merck & Company, Inc. .................. 2,200 126,500
Mylan Laboratories...................... 5,300 100,700
Schering-Plough Corp. .................. 2,800 150,150
---------
845,325
---------
<CAPTION>
Issuer Shares Value
- ---------------------------------------- --------- -----------
<S> <C> <C>
Printing & Publishing -- 1.6%
Bowne & Co., Inc. ...................... 600 $ 11,175
Houghton Mifflin Co. ................... 200 8,200
Readers Digest Association, Inc., Class
A...................................... 3,100 155,775
---------
175,150
---------
Retailing -- 2.7%
Albertson's, Inc. ...................... 3,100 103,075
Arbor Drugs, Inc. ...................... 750 13,875
Burlington Coat Factory Warehouse*...... 900 10,012
Casey's General Stores, Inc. ........... 800 18,400
Claire's Stores, Inc. .................. 600 11,775
Sbarro, Inc. ........................... 500 10,438
Wal-Mart Stores, Inc. .................. 5,600 121,100
---------
288,675
---------
Shipping/Transportation -- 0.1%
Arnold Industries, Inc. ................ 700 11,375
---------
Steel -- 0.1%
Commercial Metals Co. .................. 400 10,300
---------
Telecommunications -- 1.7%
A T & T Corp. .......................... 2,900 185,600
---------
Textiles -- 0.1%
Interface, Inc. ........................ 900 13,613
---------
Tire & Rubber -- 0.5%
Bandag, Inc. ........................... 1,100 56,375
---------
Utilities -- 0.6%
Bay State Gas Co. ...................... 500 12,500
Eastern Enterprises..................... 400 11,950
Northwest Natural Gas Co. .............. 400 12,800
Piedmont Natural Gas Company, Inc. ..... 500 11,000
Southwestern Energy Co. ................ 800 10,000
United Water Resources, Inc. ........... 800 10,100
---------
68,350
---------
Wholesaling -- 0.1%
Handleman Co. .......................... 1,200 9,300
---------
TOTAL COMMON STOCK
(Cost $4,907,707)..................... 6,148,906
---------
PREFERRED STOCK -- 2.2%
Banking -- 1.1%
National Westminster Bank, 7.875%,
Ser. A................................. 5,000 121,875
---------
Financial Services -- 1.1%
Morgan Stanley Financial Placing Corp.,
7.8% (convertible)..................... 5,000 122,500
---------
TOTAL PREFERRED STOCK
(Cost $235,938)........................ 244,375
---------
</TABLE>
See notes to financial statements.
4
<PAGE> 119
IEEE BALANCED FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Issuer Amount Value
- ---------------------------------------- --------- -----------
<S> <C> <C>
CORPORATE BONDS & NOTES -- 12.3%
Banking -- 2.4%
BankAmerica Corp.,
7.200%, due 04/15/06 $ 250,000 $ 258,065
Consumer Products -- 1.8%
Colgate Palmolive Co.,
6.020%, due 08/15/03................... 200,000 195,308
Electronics/ Electrical
Equipment -- 2.5%
Motorola, Inc.,
7.600%, due 01/01/07 250,000 271,850
Entertainment -- 2.1%
Walt Disney, Inc.,
8.000%, due 10/27/06................... 200,000 223,244
Financial Services -- 1.6%
IBM Credit Corp.,
8.500%, due 01/26/00................... 50,000 50,267
Norwest Financial, Inc.,
6.875%, due 12/15/99................... 120,000 122,640
Retailing -- 1.0%
Wal-Mart Stores, Inc.,
7.500%, due 05/15/04................... 100,000 106,659
Telecommunications -- 0.9%
Northern Telecom, Inc.,
6.000%, due 09/01/03................... 100,000 96,581
---------
TOTAL CORPORATE BONDS & NOTES
(Cost $1,257,004)...................... 1,324,614
---------
MORTGAGE-BACKED SECURITIES -- 4.4%
Federal Home Loan Mortgage Corp., Ser.
1661, Class PG, (CMO)
6.000%, due 03/15/08.................. 250,000 244,140
Government National Mortgage
Association, II, Pool 8315,
5.500%, due 11/20/23................... 225,527 226,549
---------
TOTAL MORTGAGE-BACKED SECURITIES
(Cost $472,539)........................ 470,689
---------
U.S. GOVERNMENT OBLIGATIONS -- 15.8%
U.S. Treasury Bond -- 2.7%
6.250%, due 08/15/23................... 300,000 293,202
---------
<CAPTION>
Principal
Issuer Amount Value
- ---------------------------------------- --------- -----------
<S> <C> <C>
U.S. Treasury Notes -- 13.1%
4.250%, due 11/30/95................... $ 100,000 $ 99,891
4.375%, due 11/15/96................... 150,000 148,171
5.125%, due 11/30/98................... 150,000 147,516
5.500%, due 04/15/00................... 100,000 98,984
5.750%, due 08/15/03................... 300,000 295,923
6.000%, due 06/30/96................... 250,000 250,625
6.750%, due 06/30/99................... 250,000 257,930
7.750%, due 01/31/00................... 100,000 107,172
---------
1,406,212
---------
TOTAL U.S. GOVERNMENT OBLIGATIONS
(Cost $1,701,621)..................... 1,699,414
---------
TOTAL LONG-TERM INVESTMENTS
(Cost $8,574,809)..................... 9,887,998
---------
SHORT-TERM INVESTMENTS -- 6.3%
U.S. GOVERNMENT
OBLIGATION -- 0.1%
U.S. Treasury Bill,
5.270%, due 11/30/95+.................. 10,000 9,957
---------
U.S. GOVERNMENT SPONSORED AGENCY
OBLIGATIONS -- 6.2%
Federal Home Loan Mortgage Corp.,
Discount Notes --
5.620%, due 11/08/95 65,000 64,929
5.620%, due 11/08/95 75,000 74,918
5.620%, due 11/09/95+ 380,000 379,525
5.650%, due 11/06/95+ 150,000 149,882
---------
669,254
---------
TOTAL SHORT-TERM INVESTMENTS
(Cost $679,211)........................ 679,211
---------
TOTAL INVESTMENTS
(COST $9,254,020)...................... 98.1% $10,567,209
---------
---------
</TABLE>
- ---------------
* Non income producing.
+ Security is pledged to cover written options on futures contracts.
See notes to financial statements.
5
<PAGE> 120
IEEE BALANCED FUND
PORTFOLIO OF INVESTMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
WRITTEN OPTION OUTSTANDING
<TABLE>
<CAPTION>
Number of Strike Unrealized
Description Contracts Price Depreciation
- ----------------------------------------------------------------------------------- ---------- ------ -------------
<S> <C> <C> <C>
U.S. Treasury Bond Futures, expires November 18, 1995
(Premium received $2,596)........................................................ 2 $ 114 $(3,841)
</TABLE>
PURCHASED INDEX FUTURES OUTSTANDING
<TABLE>
<CAPTION>
Number Original Nominal
Expiration of Nominal Value at Unrealized
Description Date Contracts Value 10/31/95 Appreciation
- --------------------------------------------------------- ----------- ---------- --------- --------- -------------
<S> <C> <C> <C> <C> <C>
U.S. Long Bond........................................... 12/19/95 2 $ 225,187 $ 234,125 $8,938
</TABLE>
See notes to financial statements.
6
<PAGE> 121
IEEE BALANCED FUND
STATEMENT OF ASSETS AND LIABILITIES October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments securities, at value (Note 1).............. $ 10,567,209
Cash................................................... 21,076
Receivables:
Investment securities sold.......................... 76,188
Interest............................................ 51,947
Dividends........................................... 4,136
Trust shares sold................................... 49,500
Variation margin receivable......................... 562
Expense reimbursement from Distributor.............. 41,957
------------
Total Assets...................................... 10,812,575
------------
LIABILITIES:
Options Written........................................ 2,596
Depreciation on Options Written........................ 3,841
Accrued liabilities: (Note 2)
Administration fees................................. 905
Distribution fees................................... 2,261
Investment advisory fees............................ 5,429
Shareholder servicing fees.......................... 2,261
Sub-administration fees............................. 452
Custody fees........................................ 9,740
Other............................................... 13,202
------------
Total Liabilities................................. 40,687
------------
NET ASSETS:
Paid in capital........................................ 9,742,985
Accumulated undistributed net investment income........ 5,576
Accumulated undistributed net realized gain/(loss) on
investment transactions............................. (294,959)
Net unrealized appreciation/(depreciation) of
investments
and futures......................................... 1,318,286
------------
Net assets........................................ $ 10,771,888
============
Shares of beneficial interest outstanding (no par
value; unlimited number of shares authorized):...... 980,997
============
Net asset value, offering and redemption price per
share (net assets/shares outstanding):.............. $10.98
============
Cost of Investments.................................... $ 9,254,020
============
</TABLE>
See notes to financial statements.
7
<PAGE> 122
IEEE BALANCED FUND
STATEMENT OF OPERATIONS
For the year ended October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT INCOME: (Note 1C)
Interest.................................................. $ 233,600
Dividends................................................. 114,251
-----------
Total investment income................................ 347,851
-----------
EXPENSES: (Note 2)
Administration fees....................................... 9,592
Distribution fees......................................... 23,980
Investment Advisory fees.................................. 62,347
Shareholder servicing fees................................ 23,980
Sub-administration fees................................... 4,796
Custodian fees............................................ 8,980
Printing and Postage...................................... 13,001
Professional fees......................................... 32,678
Registration costs........................................ 18,369
Transfer agent fees....................................... 19,959
Trustees fees............................................. 524
Other..................................................... 8,007
-----------
Total expenses......................................... 226,213
-----------
Less amounts waived (Note 2A)............................. 4,796
Less expenses borne by the Distributor (Note 2C).......... 101,519
-----------
Net expenses........................................... 119,898
-----------
Net investment income................................ 227,953
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain(loss) on:
Investments............................................ (88,623)
Change in net unrealized appreciation/depreciation on:
Investments............................................ 1,610,625
Options contracts and futures.......................... 5,097
-----------
Net realized and unrealized gain on investments........... 1,527,099
-----------
Net increase in net assets from operations........... $ 1,755,052
==========
</TABLE>
See notes to the financial statements.
8
<PAGE> 123
IEEE BALANCED FUND
STATEMENTS OF CHANGES IN NET ASSETS for the periods indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Year
Ended Ended
10/31/95 10/31/94
------------ -----------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income...................... $ 227,953 $ 194,078
Net realized loss on investments, options
and futures transactions................ (88,623) (170,593)
Change in net unrealized appreciation/
depreciation............................ 1,615,722 (308,895)
------------ -----------
Increase in net assets from
operations............................ 1,755,052 (285,410)
------------ -----------
NET EQUALIZATION CREDITS (Note 1G):.......... 275 8,840
------------ -----------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
FROM (Note 1H):
Net investment income...................... (232,953) (197,425)
In excess of net realized gains............ -- (36,213)
------------ -----------
Total dividends and
distributions.................... (232,953) (233,638)
------------ -----------
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
(Note 5)
Proceeds from shares sold.................. 1,046,406 3,195,243
Reinvestment of dividends and
distributions........................... 226,991 227,054
Payments for shares redeemed............... (800,821) (226,417)
------------ -----------
Net increase in net assets from
transactions in shares of
beneficial interest................ 472,576 3,195,880
------------ -----------
Total increase in net assets....... 1,994,950 2,685,672
NET ASSETS:
Beginning of period........................ 8,776,938 6,091,266
------------ -----------
End of period.............................. $ 10,771,888 $ 8,776,938
============ ==========
</TABLE>
- ---------------
* Commencement of operations
See notes to financial statements.
9
<PAGE> 124
NOTES TO FINANCIAL STATEMENTS October 31, 1995
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES -- Mutual Fund Group (the "Trust") is
organized as a Massachusetts Business Trust, and is registered under the
Investment Company Act of 1940, as amended, (the "1940 Act") as an open-end
management investment company. IEEE Balanced Fund ("the Fund"), is a separate
portfolio of the Trust. The Fund was established on September 8, 1993 for the
purpose of providing IEEE members with a no-load balanced fund investment.
The merger of the IEEE Balanced Fund into the Vista Balanced Fund was approved
at the October 13, 1995 Trustees' meeting, subject to the approval of the
shareholders of the respective fund. It is expected that shareholders will be
solicited for their vote during the first quarter of 1996.
The following is a summary of significant accounting policies followed by
the Fund:
A. Valuation of investments -- Equity securities listed on a securities
exchange or reported through the NASDAQ National Market system are valued
at the last reported sale price on the principal exchange on the date of
valuation. Securities for which sale prices are not available are valued at
last quoted bid price. Bonds and other fixed income securities (other than
short-term obligations), including listed issues, are valued using matrix
pricing systems of a major dealer in bonds which take into account factors
such as institutional-size trading in similar groups of securities, yield,
quality, coupon rate, maturity, type of issue, trading characteristics and
other market data, without exclusive reliance upon quoted exchange or
over-the-counter prices. Short-term debt securities with 61 days or more to
maturity at time of purchase are valued, through the 61st day prior to
maturity, at market value based on quotations obtained from market makers
or other appropriate sources; thereafter, the value on the 61st day is
amortized on a straight-line basis over the remaining number of days to
maturity. Short-term investments with 60 days or less to maturity at time
of purchase are valued at amortized cost, which approximates market.
B. Repurchase agreements -- It is the Fund's policy that repurchase
agreements are fully collateralized by U.S. Treasury and Government agency
securities. All collateral is held by the Trust's custodian bank,
sub-custodian, or a bank with which the custodian bank has entered into a
sub-custodian agreement, or is segregated in the Federal Reserve Book Entry
System. In connection with transactions in repurchase agreements, if the
seller defaults and the value of the collateral declines, or if the seller
enters an insolvency proceeding, realization of the collateral by the Trust
may be delayed or limited.
C. Security transactions and investment income -- Investment transactions
are accounted for on the trade date (the date the order to buy or sell is
executed). Securities gains and losses are calculated on the identified
cost basis. Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date.
D. Futures contracts -- When the Fund enters into a futures contract, it
makes an initial margin deposit in a segregated account, either in cash or
liquid securities. Thereafter, the futures contract is marked to market and
the Fund makes (or receives) additional cash payments daily to the broker.
Changes in the value of the contract are recorded as unrealized
appreciation/depreciation until the contract is closed or settled.
10
<PAGE> 125
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
Use of futures contracts subject the Fund to risk of loss in excess of
amounts shown on the Statement of Assets and Liabilities, up to the amount
of the value of the contract. The Fund held contracts outstanding at
October 31, 1995 as listed on the Statement of Portfolio of Investments.
The Fund may enter into futures contracts only on exchanges or boards of
trade. The exchange or board of trade acts as the counterparty to each
futures transaction, therefore, the Fund's credit risk is limited to
failure of the exchange or board of trade.
E. Written options -- When the Fund writes an option on a futures
contract, an amount equal to the premium received by the Fund is included
in the Fund's Statement of Assets and Liabilities as an asset and
corresponding liability. The amount of the liability is adjusted daily to
reflect the current market value of the written options and the change is
recorded in a corresponding unrealized gain or loss account. When a written
option expires on its stipulated expiration date, or when a closing
transaction is entered into, the related liability is extinguished and the
Fund realizes a gain (or loss if the cost of the closing transaction
exceeds the premium received when the option was written).
The Fund writes options on futures on stock index and U.S. Treasury
securities futures. These options are settled for cash and subject the Fund
to market risk in excess of the amounts that are reflected in the Statement
of Assets and Liabilities.
F. Federal income taxes -- The Fund is treated as a separate taxable
entity for Federal income tax purposes. The Fund's policy is to comply with
the provisions of the Internal Revenue Code applicable to regulated
investment companies and to distribute to shareholders all of the Fund's
distributable net investment income, and net realized gain on investments.
In addition, the Fund intends to make distributions as required to avoid
excise taxes. Accordingly, no provision for Federal income or excise tax is
necessary.
G. Equalization -- The Fund follows the accounting practice known as
equalization by which a portion of the proceeds from sales and costs of
redemptions of Fund shares equivalent, on a per-share basis, to the amount
of undistributed net investment income on the date of the transactions, is
credited or charged to undistributed net investment income. As a result,
undistributed net investment income per share is unaffected by sales or
redemptions of Fund shares.
H. Distributions to shareholders -- Dividends are paid to shareholders
quarterly. Dividends and distributions to shareholders are recorded on the
ex-dividend date. The amount of dividends and distributions from net
investment income and net realized capital gains is determined in
accordance with federal income tax regulations, which may differ from
generally accepted accounting principals. To the extent these "book/tax"
differences are permanent in nature, (i.e., that they result from other
than timing of recognition--"temporary differences") such amounts are
reclassified within the capital accounts based on their federal tax-basis
treatment. The reclassifications made for the Fund are as follows: paid-in
capital was increased and accumulated undistributed net investment income
was decreased by $275. Dividends and distributions which exceed net
investment income or net realized capital gains for financial reporting
purposes but not for tax purposes are reported as distributions in excess
of net investment income or net realized capital gains. The adjustment for
the Fund relates primarily to the character for tax purposes of
equalization.
11
<PAGE> 126
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
I. Expenses -- Expenses directly attributable to a Fund are charged to
that Fund; other expenses are allocated proportionately among each Fund
within the Trust in relation to the net assets of each Fund or on another
reasonable basis.
2. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A. Investment advisory fee -- The Chase Manhattan Bank, N.A. (the
"Adviser") acts as investment adviser to the Fund pursuant to an Investment
Advisory Agreement. The Adviser is a wholly-owned subsidiary of The Chase
Manhattan Corporation. The Adviser has retained the "Sub-Adviser" to
provide portfolio advisory services. The Sub-Adviser is Atlanta Capital
Management Company ("Atlanta Capital" or the "Sub-Adviser"), an investment
advisory firm. For its services under the Investment Advisory Agreement,
the Adviser receives an annual fee computed daily and paid monthly at an
annual rate equal to .65% of the Fund's average daily net assets. The
Adviser may, from time to time, waive all or a portion of its fees. For the
year ended October 31, 1995, the Adviser waived fees of $4,796.
The Adviser has retained the Sub-Adviser to provide portfolio management
services pursuant to a Sub-Adviser Agreement ("Agreement"). Pursuant
further to this Agreement the Adviser has agreed to pay the Sub-Adviser a
monthly fee at the annual rate of .65% of the average daily net assets of
the Fund less any amount of the advisory fee waived by the Adviser.
B. Shareholder servicing fees -- The Trust has adopted an Administrative
Services Plan which, among other things, provides that the Trust on behalf
of the Fund may obtain the services of one or more Shareholder Servicing
Agents. For its services, each Shareholder Servicing Agent will receive
fees determined by a formula based upon the average number of accounts
serviced and the number of transactions processed by such Shareholder
Servicing Agent during the period for which payment is being made, and any
out-of-pocket expenses incurred, provided that such fees will not exceed,
on an annualized basis, 0.25% of the average daily net assets of the Fund.
C. Distribution and Sub-administration fees -- Pursuant to a Distribution
and Sub-administration Agreement, Vista Broker-Dealer Services, Inc.
("VBDS" or the "Distributor"), a wholly-owned subsidiary of Concord Holding
Corp., which is a wholly owned subsidiary of The BISYS Group, Inc., acts as
the Trust's exclusive underwriter and promotes and arranges for the sale of
the Fund's shares. In addition, the Distributor provides certain
sub-administration services to the Trust, including providing officers,
clerical staff and office space for an annual fee of 0.05% of the average
daily net assets of the Fund.
The Trustees have approved a plan of distribution for the Fund, the "Vista
Plan". Pursuant to the Vista Plan, the Fund may pay the Distributor a
distribution fee not to exceed the annual rate of 0.25% of the Fund's
average daily net assets for its services in connection with the
distribution of Fund shares.
For the year ended October 31, 1995, the Distributor reimbursed the Fund
for expenses incurred amounting to $101,519.
D. Administration fee -- Pursuant to an Administration Agreement, Chase
(the "Administrator") provides certain administration services to the
Trust. For these services and facilities, the Administra-
12
<PAGE> 127
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
tor receives from the Fund a fee computed at the annual rate equal to 0.10%
of the Fund's average daily net assets.
E. Other -- Certain officers of the Trust are officers of VBDS or of its
parent corporation, BISYS.
Chase provides portfolio accounting and custody services for the Fund. Such
amounts are presented in the Statement of Operations as custodian fees.
On August 27, 1995, the Chase Manhattan Corporation and Chemical Banking
Corporation announced an agreement in principle to merge, which was
approved by shareholders of both corporations on December 11, 1995, subject
to the approval of regulators.
3. INVESTMENT TRANSACTIONS -- For the year ended October 31, 1995, purchases
and sales of investments (excluding short-term investments) were as follows:
<TABLE>
<S> <C>
Purchases (excluding U.S. Government)......................................... $ 2,651,192
Sales (excluding U.S. Government)............................................. 2,823,309
Purchases of U.S. Government.................................................. 100,595
Sales of U.S. Government...................................................... 69,692
</TABLE>
Written option transactions on securities and stock indices during the period
are summarized as follows:
<TABLE>
<CAPTION>
Puts Calls
--------------------- ---------------------
Number of Premiums Number of Premiums
Contracts Received Contracts Received
--------- -------- --------- --------
<S> <C> <C> <C> <C>
Options outstanding at 10/31/94...................... -- -- -- --
Options written...................................... 1 $ 469 2 $2,596
Options closed....................................... 1 (469) -- --
-- ------ -- ------
Options outstanding at 10/31/95...................... -- -- 2 $2,596
== ====== == ======
</TABLE>
4. FEDERAL INCOME TAX MATTERS -- For Federal income tax purposes, the cost and
unrealized appreciation (depreciation) in value of the investment securities at
October 31, 1995 are as follows:
<TABLE>
<S> <C>
Aggregate cost................................................................ $9,254,020
----------
Gross unrealized appreciation................................................. $1,496,816
Gross unrealized depreciation................................................. (183,627)
----------
Net unrealized appreciation................................................... $1,313,189
==========
</TABLE>
At October 31, 1995 the Fund had a net capital loss carryover of approximately
$289,000. Such losses of approximately $202,000 and $87,000 will be available to
offset capital gains arising through October 31, 2002 and October 31, 2003,
respectively. To the extent that any net capital loss carryover is used to
offset future capital gains, it is probable that the gains so offset will not be
distributed to shareholders.
13
<PAGE> 128
NOTES TO FINANCIAL STATEMENTS October 31, 1995 (continued)
- --------------------------------------------------------------------------------
5. TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST -- Transactions in Shares of
beneficial interest were as follows for the periods indicated:
<TABLE>
<CAPTION>
Year Ended
---------------------
10/31/95 10/31/94
-------- --------
<S> <C> <C>
Shares sold.......................................................... 103,775 329,188
Shares issued in reinvestment of distributions....................... 22,456 23,821
Shares redeemed...................................................... (80,594) (23,764)
-------- --------
Net increase in shares of beneficial interest outstanding............ 45,637 329,245
Outstanding shares at:
Beginning of period................................................ 935,360 606,115
-------- --------
End of period...................................................... 980,997 935,360
======== ========
</TABLE>
6. RETIREMENT PLAN -- During the year ended October 31, 1995, the Trust
adopted an unfunded noncontributory defined benefit pension plan covering all
independent directors of the Trust, who have served as an independent director
of the Trust, or other Vista Funds, for at least five years at the time of
retirement. Benefits under this plan are based on compensation and years of
service. Management has determined that the accrual for prior service costs is
not material.
14
<PAGE> 129
IEEE BALANCED FUND
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OF BENEFICIAL INTEREST
OUTSTANDING
Throughout Each Period Indicated
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended 9/15/93*
--------------------- through
10/31/95 10/31/94 10/31/93
-------- -------- --------
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of
period............................ $ 9.38 $ 10.05 $ 10.00
-------- -------- --------
Income from Investment operations:
Net investment income............. 0.240 0.237 0.050
Net gains (losses) in securities
(both realized and
unrealized)..................... 1.610 (0.614) 0.014
-------- -------- --------
Total from Investment
operations...................... 1.850 (0.377) 0.064
-------- -------- --------
Less: Dividends from net investment
income............................ 0.246 0.240 0.014
Distributions in excess of net
realized capital losses........... -- 0.053 --
-------- -------- --------
Total Distributions.................. 0.246 0.293 0.014
-------- -------- --------
Net Asset Value, End of Period....... $10.98 $ 9.38 $ 10.05
======== ======== ========
TOTAL RETURN......................... 19.93% (3.78%) 0.64%
======== ======== ========
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000
omitted).......................... $0,772 $ 8,777 $ 6,091
Ratio of expenses to average net
assets**.......................... 1.25 % 1.12 % 0.00 %
Ratio of net investment income to
average net assets**.............. 2.38 % 2.48 % 3.08 %
Ratio of expenses without waivers and
assumption of expenses to average
net assets**...................... 2.36 % 3.15 % 3.36 %
Ratio of net investment income
without waivers and assumption of
expenses to average net
assets**.......................... 1.27 % 0.45 % (0.28 %)
Portfolio turnover rate.............. 30 % 28 % 0 %
</TABLE>
- ---------------
* Commencement of operations.
** Short periods have been annualized.
See notes to financial statements.
15
<PAGE> 130
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE TRUSTEES
AND SHAREHOLDERS OF
MUTUAL FUND GROUP
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the selected per share data and ratios for a share of
beneficial interest outstanding present fairly, in all material respects, the
financial position of IEEE Balanced Fund, (one of the portfolios constituting
Mutual Fund Group, hereafter referred to as the "Trust"), at October 31, 1995,
the results of its operations for the year then ended, the changes in its net
assets for each of the two years in the period then ended and the selected per
share data and ratios for a share of beneficial interest outstanding for each of
the two years in the period then ended and for the period September 15, 1993
(commencement of operations) through October 31, 1995, in conformity with
generally accepted accounting principles. These financial statements and
selected per share data and ratios for a share of beneficial interest
outstanding (hereafter referred to as "financial statements") are the
responsibility of the Trust's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at October 31, 1995 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above.
As more fully described in Note 1, the Trustees have approved the merger of IEEE
Balanced Fund into Vista Balanced Fund, subject to shareholder approval.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York 10036
December 11, 1995
<PAGE> 131
UNAUDITED
IEEE BALANCED FUND
- --------------------------------------------------------------------------------
Certain tax information regarding the Vista Mutual Funds is required to be
provided to shareholders based upon the Funds income and distributions for the
taxable year ended October 31, 1995. The information and distributions reported
in this letter may differ from the information and distributions taxable to the
shareholders for the calendar year ending December 31, 1995. The information
necessary to complete your income tax returns for the calendar year ending
December 31, 1995 will be received under separate cover.
FOR THE FISCAL YEAR ENDED OCTOBER 31, 1995.
The following represents the source and percentage of income earned by the
Fund from government obligations:
<TABLE>
<CAPTION>
Government
Federal National
U.S. Treasury Home Loan Mortgage
Obligations Bank Assoc.
- -------------- ---------- -----------
<S> <C> <C>
28.80% 4.36% 3.56%
</TABLE>
<PAGE> 132
(This page intentionally left blank.)
<PAGE> 133
VISTA FAMILY OF MUTUAL FUNDS
MANAGED BY CHASE MANHATTAN
Vista offers a wide variety of professionally managed mutual funds that can
help you meet your financial goals. For a brochure and prospectus containing
more complete information on sales charges or expenses, contact your
investment representative or call 1-800-34-VISTA. Please read the prospectus
carefully before you invest or send money:
<TABLE>
<S> <C>
VISTA EQUITY FUNDS VISTA FIXED INCOME FUNDS
Growth and Income Fund U.S. Government Income Fund(2)
Capital Growth Fund Tax Free Income Fund
Small Cap Equity Fund New York Tax Free Income Fund
Equity Income Fund California Intermediate Tax Free Fund
Growth Fund of Washington(1)
VISTA MONEY MARKET FUNDS(2)
VISTA BALANCED FUND U.S. Government Money Market Fund
Balanced Fund Treasury Plus Money Market Fund
Tax Free Money Market Fund
VISTA INTERNATIONAL FUNDS New York Tax Free Money Market Fund
Global Fixed Income Fund California Tax Free Money Market Fund
International Equity Fund Global Money Market Fund
European Fund Federal Money Market Fund
Japan Fund Prime Money Market Fund
Southeast Asian Fund Select Shares of Connecticut Daily Tax
Free Income Fund(3)
Select Shares of New Jersey Daily Municipal
Income Fund(3)
</TABLE>
Vista Broker-Dealer Services, Inc. is the funds' distributor and is
unaffiliated with Chase. The Chase Manhattan Bank, N.A. is the funds'
portfolio adviser and provides other services to the funds.
(1) Washington Investment Advisors, Inc. is the fund's investment adviser.
(2) An investment in these funds is neither insured nor guaranteed by the U.S.
government, and there can be no assurance that these funds will be able to
maintain a stable Net Asset Value of $1.00 per share.
(3) Vista Select Shares of Connecticut Daily Tax Free Income Fund, Inc., and
Vista Select Shares of New Jersey Daily Municipal Income Fund, Inc., are
not part of, or affiliated with, the Vista Family of Mutual Funds. Reich &
Tang Distributors L.P. and New England Investment Companies L.P., which
are unaffiliated with Chase, are the funds' distributor and investment
adviser, respectively. National bank subsidiaries of The Chase Manhattan
Corporation do, however, perform shareholder servicing agent services for
the funds, although they perform no other services for the funds, such as
serving as investment adviser, custodian or administrator.
INVESTMENTS IN MUTUAL FUNDS ARE SUBJECT TO RISK, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL. IN ADDITION, THEY ARE NOT DEPOSITS, OBLIGATIONS OF, ENDORSED OR
GUARANTEED BY CHASE AND ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD
OR ANY OTHER GOVERNMENT AGENCY.
<PAGE> 134
[VISTA LOGO]
- --------------------------------------------------------------------------------
ANNUAL
-------------------------------------
REPORT
VISTA SERVICE CENTER
P.O. BOX 419392
KANSAS CITY, MO 64179
INVESTMENT ADVISER,
ADMINISTRATOR,
SHAREHOLDER SERVICING AGENT
AND CUSTODIAN
The Chase Manhattan Bank, N.A.
DISTRIBUTOR
Vista Broker-Dealer Services,
Inc.
SUB-ADVISERS
Atlanta Capital Management
Company (with the Institute of
Electrical and Electronic
Engineers, Inc.)
TRANSFER AGENT
DST Systems, Inc.
LEGAL COUNSEL
Kramer, Levin, Naftalis, Nessen,
Kamin & Frankel
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
Vista Broker-Dealer Services,
Inc. is the Fund's distributor
and is unaffiliated with Chase.
The Chase Manhattan Bank, N.A. is
the Fund's adviser.
This report is submitted for the
general information of the
shareholders of the fund. It is
not authorized for distribution
to prospective investors in the
fund unless preceded or
accompanied by a prospectus. To
obtain a prospectus for any of
the Vista funds, call 1-800-34-
VISTA. The prospectus contains
more complete information,
including charges and expenses.
Please read it carefully before
you invest or send money.
IEBAL-2
IEEE
BALANCED
FUND
[ART]
FOR THE 12 MONTHS ENDED
OCTOBER 31, 1995
