<PAGE>
Registration No. 33-14737
811-5155
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 1, 1996.
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
____________________
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
PRE-EFFECTIVE AMENDMENT NO.
POST-EFFECTIVE AMENDMENT NO. 11 /X/
AND/OR
REGISTRATION STATEMENT UNDER
THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 12 /X/
____________________
CHUBB INVESTMENT FUNDS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
ONE GRANITE PLACE
CONCORD, NEW HAMPSHIRE 03301
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
603-226-5000
(REGISTRANT'S TELEPHONE NUMBER)
MICHAEL O'REILLY, PRESIDENT
ONE GRANITE PLACE
CONCORD, NEW HAMPSHIRE 03301
(NAME AND ADDRESS OF AGENT FOR SERVICE)
COPIES TO:
THOMAS H. ELWOOD, Esq. JANE KANTER, ESQ.
Chubb Investment Funds, Inc. Katten Muchin & Zavis
One Granite Place 1025 Thomas Jefferson Street, N.W.
Concord, NH 03301 Washington, D.C. 20007
Approximate date of proposed public offering: It is proposed that this filing
will become effective on April 5, 1996 pursuant to Rule 485(b).
The Registrant has registered an indefinite number or amount of its shares
of common stock under the Securities Act of 1933 pursuant to Rule 24f-2 under
the Investment Company Act of 1940. The Registrant filed a Rule 24f-2 Notice on
February 27, 1996.
<PAGE>
CHUBB INVESTMENT FUNDS, INC.
CROSS REFERENCE SHEET
Cross reference sheet showing location in the Prospectus of information
require by items in Part A of Form N-1A.
<TABLE>
<CAPTION>
ITEM
NUMBER HEADING IN PROSPECTUS
------ ---------------------
<C> <S>
1 Cover Page
2 Fee Table
3 Condensed Financial Information
4 General Description, Investment Objectives and
Policies,
Special Investment Practices, Capital Stock
5 Management of the Company, Management Fees
and Expenses, Distribution Plan
6 Capital Stock, Taxes and Dividends, Taxation of
Shareholders
7 Purchase of Shares, Reduced Sales Charges,
Distribution Plan, Determination of Net Asset
Value, Shareholder Services
8 Redemption or Repurchase
9 (Legal Proceedings)*
</TABLE>
______
*Indicates inapplicable or negative
<PAGE>
- -------------------------------------------------------------------------------
CHUBB INVESTMENT FUNDS, INC.
ONE GRANITE PLACE
CONCORD, NEW HAMPSHIRE 03301
(603) 226-5000
- -------------------------------------------------------------------------------
Chubb Investment Funds, Inc. (the "Company") was incorporated in Maryland on
April 27, 1987. The Company is an open-end management investment company which
is composed of seven separate funds, each of which is a distinct portfolio of
investments having its own investment objectives and policies. Six of these
funds are diversified companies and one, the Chubb Global Income Fund, is a
non-diversified company. The names and investment objectives of the funds are
as follows:
Chubb Money Market Fund: to seek the highest possible level of current
income as is consistent with the preservation of capital and maintenance of
liquidity by investing primarily in short-term high-grade debt obligations. AN
INVESTMENT IN THE CHUBB MONEY MARKET FUND IS NEITHER INSURED NOR GUARANTEED BY
THE UNITED STATES GOVERNMENT. INVESTMENTS IN THE FUND ARE NOT BANK DEPOSITS
AND ARE NOT SECURED BY, GUARANTEED BY, OBLIGATIONS OF, OR OTHERWISE SUPPORTED
BY THE FDIC OR ANY BANK. THERE CAN BE NO ASSURANCE THAT THE FUND WILL BE ABLE
TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
Chubb Government Securities Fund: to earn as high a level of income as is
consistent with maintaining safety of principal by investing exclusively in
debt obligations issued, guaranteed or collateralized by the United States
Government, its agencies or its instrumentalities.
Chubb Total Return Fund: to produce the highest total return through a
combination of income and capital appreciation as is consistent with
reasonable risk by investing in a portfolio of income-producing debt and
equity securities.
Chubb Tax-Exempt Fund: to provide a stable level of current income which is
exempt from Federal income taxes, consistent with the preservation of capital,
by investing primarily in investment-grade tax-exempt securities.
Chubb Growth and Income Fund: to seek long-term growth by investing
primarily in a wide range of equity issues that the Investment Manager
believes will offer possibilities of capital appreciation and, secondarily, to
seek a reasonable level of current income.
Chubb Capital Appreciation Fund: to seek long term capital appreciation by
investing primarily in equity securities.
Chubb Global Income Fund: to seek high current income and capital
appreciation by investing primarily in debt securities of domestic and foreign
issuers. CERTAIN OF THE FUND'S INVESTMENTS MAY HAVE SPECULATIVE
CHARACTERISTICS.
This Prospectus sets forth concisely the information about the Company which
a prospective investor should know before investing. Investors should retain
this Prospectus for future reference. More information about the Company is
included in the Statement of Additional Information, which has been filed with
the Securities and Exchange Commission and is incorporated herein by
reference.
A copy of the Statement of Additional Information dated April 1, 1996 is
available upon request and without charge by writing to the Company's
distributor. Chubb Securities Corporation, P.O. Box 20061, One Granite Place,
Concord, NH 03302 Attention: Marketing Department, or by calling
1-800-452-4822. Inquiries about the Company should be directed to the
distributor at the same address or telephone number.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- -------------------------------------------------------------------------------
THE DATE OF THIS PROSPECTUS IS APRIL 1, 1996.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
FEE TABLE.................................................................. 2
FINANCIAL HIGHLIGHTS....................................................... 4
GENERAL DESCRIPTION........................................................ 11
PERFORMANCE AND YIELD INFORMATION.......................................... 11
INVESTMENT OBJECTIVES AND POLICIES......................................... 11
Chubb Money Market Fund.................................................. 11
Chubb Government Securities Fund......................................... 12
Chubb Total Return Fund.................................................. 13
Chubb Tax-Exempt Fund.................................................... 14
Chubb Growth and Income Fund............................................. 15
Chubb Capital Appreciation Fund.......................................... 16
Chubb Global Income Fund................................................. 17
SPECIAL INVESTMENT PRACTICES............................................... 17
Equity Securities........................................................ 18
Repurchase Agreements.................................................... 18
Reverse Repurchase Agreements............................................ 18
Foreign Securities, ADRs, EDRs and GDRs.................................. 18
Lending of Portfolio Securities.......................................... 19
DERIVATIVES................................................................ 19
Forward Foreign Currency Exchange Contracts.............................. 19
Cross Currency Hedges.................................................... 20
Writing Covered Call Options and Purchasing Put Options.................. 20
Swaps, Caps, Floors and Collars.......................................... 21
Restricted Securities...................................................... 21
ADDITIONAL RISK FACTORS.................................................... 22
PORTFOLIO TURNOVER......................................................... 23
MANAGEMENT OF THE COMPANY.................................................. 23
MANAGEMENT FEES AND EXPENSES............................................... 24
CAPITAL STOCK.............................................................. 25
TAXES AND DIVIDENDS........................................................ 26
TAXATION OF SHAREHOLDERS................................................... 26
PURCHASE OF SHARES......................................................... 27
REDUCED SALES CHARGES...................................................... 28
DISTRIBUTION PLAN.......................................................... 30
DETERMINATION OF NET ASSET VALUE........................................... 31
REDEMPTION OR REPURCHASE................................................... 31
SHAREHOLDER SERVICES....................................................... 33
Automatic Investment Program............................................. 33
Systematic Withdrawal Plan............................................... 33
Exchange Privilege....................................................... 34
Systematic Exchange Privilege............................................ 34
Checkwriting Privilege................................................... 34
Individual Retirement Account............................................ 34
</TABLE>
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO PERSON IS AUTHORIZED TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS AND IN THE STATEMENT OF ADDITIONAL INFORMATION.
<PAGE>
FEE TABLE
The purpose of this Fee Table and Example is to assist in the understanding
of the various costs and expenses arising from the operations of the Funds.
For a discussion of the services provided to and the expenses paid by the
Company regarding each Fund, see "MANAGEMENT OF THE COMPANY" and "MANAGEMENT
FEES AND EXPENSES" in the Prospectus. See "EXCHANGE PRIVILEGE" in the
Prospectus concerning exchanges between the Funds. For a description of the
current range of sales charge rates and various methods available to reduce
the applicable sales charge, see "PURCHASE OF SHARES" and "REDUCED SALES
CHARGES" in the Prospectus.
The Fee Table, including the Example below, shows fees and expenses, based
upon amounts incurred by each Fund in existence during the year ended December
31, 1995 including waivers and assumptions of fees and expenses for that
period, restated to reflect the assumption by Chubb Life of certain additional
other expenses of the Growth and Income Fund and the Total Return Fund for the
year beginning January 1, 1996. In addition since the Capital Appreciation
Fund and Global Income Fund commenced operations on September 1, 1995,
annualized fees and expenses of the Capital Appreciation and the Global Income
Fund are included in the table.
Shareholder Transaction Expenses
<TABLE>
<CAPTION>
GROWTH
MONEY GOVERNMENT TOTAL TAX- AND CAPITAL GLOBAL
MARKET SECURITIES RETURN EXEMPT INCOME APPRECIATION INCOME
FUND FUND FUND FUND FUND FUND FUND
------ ---------- ------ ------ ------ ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Maximum Sales Charge
imposed on Purchases
(as a percentage of
offering price)....... 0 3.00% 5.00% 3.00% 5.00% 5.00% 3.00%
</TABLE>
Because each Fund may charge an asset-based sales charge of up to 0.25% per
year based on its average daily net asset value, long-term shareholders in the
Funds may pay more than the economic equivalent of the maximum front-end sales
charges currently permitted by the NASD.
Annual Operating Expenses
(Restated After Waivers and Assumptions of Fees and Expenses and a reduction
in 12b-1 fees waived by Chubb Securities Corporation) (As a Percentage of
Average Daily Net Assets)
<TABLE>
<CAPTION>
GROWTH CAPITAL
MONEY GOVERNMENT TOTAL TAX- AND APPRECIATION
MARKET SECURITIES RETURN EXEMPT INCOME INCOME GLOBAL
FUND FUND FUND FUND FUND FUND FUND
------ ---------- ------ ------ ------ ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Management Fees (after
fee waiver)............ 0.15% 0.25% 0.35% 0.25% 0.35% 0.25% 0.45%
12b-1 Fees (after fee
waiver)................ 0.15% 0.20% 0.25% 0.20% 0.25% 0.25% 0.25%
Other Expenses.......... 0.20% 0.55% 0.65% 0.55% 0.65% 0.75% 1.05%
Total Fund Operating
Expenses
(after fee waiver)..... 0.50% 1.00% 1.25% 1.00% 1.25% 1.25% 1.75%
</TABLE>
Absent any waiver or assumption of fees and expenses except pursuant to the
most restrictive state expense limitation provision, "Total Fund Operating
Expenses" for the fiscal year ended December 31, 1995 would have been 1.31%,
1.70%, 1.70%, 1.79%, 1.69%, 2.50% and 2.14% for the Money Market Fund, the
Government Securities Fund, the Total Return Fund, the Tax-Exempt Fund, the
Growth and Income Fund, Capital Appreciation Fund and Global Income Fund,
respectively. Such expenses would have been comprised of Management Fees of
0.50%, 0.65%, 0.65%, 0.65%, 0.65%, 0.65% and 0.65%; 12b-1 fees of 0.25%;
0.50%; 0.50%; 0.50%, 0.50%, 0.50% and 0.50%; and Other Expenses of 0.56%;
0.55%; 0.55%; 0.64%; 0.54%; 1.35% and 0.99% for the Money Market Fund; the
Government Securities Fund; the Total Return Fund; the Tax Exempt Fund; the
Growth and Income Fund; Capital Appreciation Fund and Global Income Fund
respectively.
2
<PAGE>
Example (Restated After Waiver of Fees and Assumption of Expenses)
An investor in each Fund would pay the following expenses on a $1,000
investment, assuming (1) 5% annual return and (2) redemption at the end of
each time period:
<TABLE>
<CAPTION>
FUND 1 YEAR 3 YEARS 5 YEARS 10 YEARS
---- ------ ------- ------- --------
<S> <C> <C> <C> <C>
Money Market Fund(1)............................ $ 5 $16 $ 29 $ 64
Government Securities Fund(2)................... $40 $62 $ 85 $152
Total Return Fund(3)............................ $62 $89 $117 $198
Tax-Exempt Fund(2).............................. $40 $62 $ 85 $152
Growth and Income Fund(3)....................... $62 $89 $117 $198
Capital Appreciation Fund(3).................... $62 $89 $117 $198
Global Income Fund(2)........................... $48 $85 $125 $236
</TABLE>
- -------
(1) No load
(2) 3.00% sales load
(3) 5.00% sales load
There are no charges imposed upon redemption; however, shareholders who
elect to use a wire transfer to effect payment directly to their bank account
will be charged a fee, currently $10.00, to cover the cost of this transfer.
The Example should not be considered representative of past or future fees
and expenses for each Fund. ACTUAL FEES AND EXPENSES FOR ANY FUND MAY BE
GREATER OR LESS THAN THOSE SHOWN ABOVE. Similarly, the annual rate of return
assumed in the Example is not an estimate or guarantee of future investment
performance.
3
<PAGE>
FINANCIAL HIGHLIGHTS
The following tables should be read in conjunction with the financial
statements and report of Ernst & Young LLP, independent auditors, which are
available upon request and without charge by calling 1-800-452-4822, and which
are incorporated by reference into the Statement of Additional Information.
For a share outstanding throughout the year (B):
<TABLE>
<CAPTION>
CHUBB MONEY MARKET FUND
------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31,
------------------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988 1987(C)
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
year....................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
INCOME FROM INVESTMENT
OPERATIONS
Net investment income....... .050 .034 .025 .030 .052 .071 .082 .061 .002
Net realized and unrealized
gains (losses) on
securities.................
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Total from investment
operations................. .050 .034 .025 .030 .052 .071 .082 .061 .002
LESS DISTRIBUTIONS TO
SHAREHOLDERS
Dividends from net
investment income.......... (.050) (.034) (.025) (.030) (.052) (.071) (.082) (.061) (.002)
Dividends in excess of net
investment income.
Distributions from capital
gains......................
Distributions in excess of
capital gains..............
Returns of capital..........
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Total distributions......... (.050) (.034) (.025) (.030) (.052) (.071) (.082) (.061) (.002)
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Net asset value, end of
year........................ $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1,000 $ 1.000 $ 1.000
========== ========== ========== ========== ========== ========== ========== ========== ========
Total Return (D)............. 5.16% 3.41% 2.50% 3.00% 5.20% 7.10% 8.20% 6.10% 0.20%(E)
RATIOS TO AVERAGE NET ASSET:
Expenses (A)................ .50% .50% .50% .50% .50% .50% -- -- --
Net investments income...... 5.05% 3.43% 2.48% 3.06% 5.25% 7.10% 7.88% 6.75% 3.96%
Portfolio Turnover Rate...... N/A N/A N/A N/A N/A N/A N/A N/A N/A
Net Assets, At End of Year... $7,620,206 $7,494,743 $5,225,178 $4,212,869 $4,410,966 $4,144,116 $2,839,724 $1,456,395 $101,338
</TABLE>
- -------
(A) A portion of all related party fees of the Fund have been waived for 1995,
1994, 1993, and 1992. All related party fees have been waived and all
other expenses of the Fund have been assumed in part for 1991 and 1990,
and in their entirety for the prior fiscal periods by Chubb Life. Had the
fees not been waived and expenses not been assumed, the ratios of expenses
to average net assets would have been 1.31% in 1995, 1.31% in 1994, 1.50%
in 1993, 2.38% in 1992, and 2.50% in 1991, 1990 and 1989, and 2.00% in
1988 and 1987, pursuant to the most restrictive state limitation.
(B) The per share amounts which are shown have been computed based on the
average number of shares outstanding during each year.
(C) Per share data calculated from the date shares of the Money Market Fund
were first sold to the public on December 18, 1987. Ratios to average net
assets have been annualized.
(D) Total return assumes reinvestment of all dividends during the year.
Investment returns and principal values may fluctuate and shares, when
redeemed, may be worth more or less than the original cost.
(E) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS IN THE STATEMENT OF ADDITIONAL INFORMATION.
4
<PAGE>
FINANCIAL HIGHLIGHTS--(CONTINUED)
For a share outstanding throughout the year:
<TABLE>
<CAPTION>
CHUBB GOVERNMENT SECURITIES FUND
-----------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31,
-----------------------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988 1987(D)
----------- ----------- ----------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net assets value,
beginning of year...... $ 9.750 $ 10.710 $ 10.700 $ 11.160 $ 10.360 $ 10.330 $ 9.890 $ 10.000 $ 10.000
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.. .636 .607 .770 .766 .750 .815 .914 .916 .047
Net realized and
unrealized gains
(losses) on
securities............ 1.030 (.960) .199 .021 .838 .049 .463 (.071)
----------- ----------- ----------- ---------- ---------- ---------- ---------- ---------- ----------
Total from investment
operations............ 1.666 (.353) .969 .787 1.588 .864 1.377 .845 .047
LESS DISTRIBUTIONS
TO SHAREHOLDERS
Dividends from net
investment income..... (.636) (.607) (.770) (.766) (.750) (.815) (.914) (.916) (.047)
Dividends in excess of
net investment
incomes...............
Distributions from
capital gains......... (.170) (.481) (.038) (.019) (.006) (0.039)
Distributions in excess
of capital gains...... (.019)
Returns of capital..... (.017)
----------- ----------- ----------- ---------- ---------- ---------- ---------- ---------- ----------
Total distributions.... (.636) (.607) (.959) (1.247) (.788) (.834) (.937) (.955) (0.47)
----------- ----------- ----------- ---------- ---------- ---------- ---------- ---------- ----------
Net asset value, end of
year.................. $ 10.780 $ 9.750 $ 10.710 $ 10.700 $ 11.160 $ 10.360 $ 10.330 $ 9.890 $ 10.000
=========== =========== =========== ========== ========== ========== ========== ========== ==========
Total Return (A)....... 17.50% (3.34%) 9.29% 7.44% 15.97% 8.90% 14.52% 8.68% 0.47%(E)
RATIOS TO AVERAGE NET
ASSET:
Expenses (B)........... 1.00% 1.00% 1.00% 1.00% 1.00% 1.05% -- -- --
Net investment income.. 6.16% 5.96% 7.04% 6.94% 7.12% 8.05% 9.06% 9.07% 7.52
Portfolio Turnover
Rate (C).............. 276.56% 113.36% 197.08% 310.29% 26.96% 24.78% 5.93% 42.63% --
Net Assets, At End of
Year.................. $13,886,478 $12,534,640 $14,679,255 $7,392,150 $4,080,963 $2,109,061 $1,612,229 $1,279,499 $1,105,959
</TABLE>
- -------
(A) Total return assumes reinvestment of all dividends during the year and
does not reflect deduction of sales charge. Investment returns and
principal values will fluctuate and shares, when redeemed, may be worth
more or less than the original cost.
(B) A portion of all related party fees of the Fund have been waived for 1995,
1994, 1993 and 1992. All related party fees have been waived and all other
expenses of the Fund have been assumed in part for 1991 and 1990, and in
their entirety for the prior fiscal periods by Chubb Life. Had the fees
not been waived and expenses not been assumed, the ratios of expenses to
average net assets would have been 1.70% in 1995, 1.71% in 1994, 1.89% in
1993, 2.50% in 1992, 1991, 1990 and 1989, and 2.00% in 1988 and 1987,
pursuant to the most restrictive state limitation.
(C) There were no purchase and/or sales of securities in 1987 other than
short-term obligations during the period. Therefore, the portfolio
turnover rate has not been calculated.
(D) Per share data calculated from the date shares of the Government
Securities Fund were first sold to the public on December 10, 1987. Ratios
to average net assets have been annualized.
(E) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS IN THE STATEMENT OF ADDITIONAL INFORMATION.
5
<PAGE>
FINANCIAL HIGHLIGHTS--(CONTINUED)
For a share outstanding throughout the year:
<TABLE>
<CAPTION>
CHUBB TOTAL RETURN FUND
------------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31,
------------------------------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988 1987(D)
----------- ----------- ----------- ----------- ---------- ---------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year... $ 13.230 $ 15.010 $ 13.890 $ 13.850 $ 11.270 $ 12.090 $ 10.510 $ 10.210 $ 10.240
INCOME FROM
INVESTMENT
OPERATIONS
Net investment
income............. .373 .373 .405 .382 .387 .437 .592 .535 .025
Net realized and
unrealized gains
(losses) on
securities......... 3.586 (.994) 1.529 .577 2.870 (.493) 2.020 .308 (.015)
----------- ----------- ----------- ----------- ---------- ---------- ---------- -------- --------
Total from
investment
operations......... 3.959 (.621) 1.934 .959 3.257 (.056) 2.612 .843 010
LESS DISTRIBUTIONS TO
SHAREHOLDERS
Dividends from net
investment income.. (.373) (.373) (.405) (.382) (.387) (.437) (.607) (.523) (.040)
Dividends in excess
of net investment
income.............
Distributions from
capital gains...... (.692) (.786) (.409) (.537) (.290) (.327) (.425) (.020)
Distributions in
excess of capital
gains.............. (.164)
Returns of capital..
----------- ----------- ----------- ----------- ---------- ---------- ---------- -------- --------
Total
distributions...... (1.229) (1.159) (.814) (.919) (.677) (.764) (1.032) (.543) (.040)
----------- ----------- ----------- ----------- ---------- ---------- ---------- -------- --------
Net asset value, end
of year............. $ 15.960 $ 13.230 $ 15.010 $ 13.890 $ 13.850 $ 11.270 $ 12.090 $ 10.510 $ 10.210
=========== =========== =========== =========== ========== ========== ========== ======== ========
Total Return (A)..... 30.13 (4.21%) 14.03% 7.11% 29.23% (.51%) 25.48% 8.31% 0.09%(E)
RATIOS TO AVERAGE NET
ASSET:
Expenses (B)........ 1.08% 1.00% 1.00% 1.00% 1.00% 1.02% -- -- --
Net investment
income............. 2.45% 2.66% 2.83% 2.97% 3.26% 3.93% 5.25% 6.22% 4.96%
Portfolio Turnover
Rate C)............. 57.62% 37.53% 66.15% 73.89% 106.90% 110.09% 105.49% 121.60% --
Net Assets, At End of
Year................ $22,171,326 $16,431,195 $14,360,086 $10,000,441 $5,259,055 $1,963,120 $1,237,868 $797,447 $103,070
</TABLE>
- -------
(A) Total return assumes reinvestment of all dividends during the year and
does not reflect deduction of sales charge. Investment returns and
principal values will fluctuate and shares, when redeemed, may be worth
more or less than the original cost.
(B) A portion of all related party fees of the Fund have been waived for 1995,
1994, and 1993. All related party fees have been waived and all other
expenses of the Fund have been assumed in part for 1992, 1991 and 1990,
and in their entirety for the prior fiscal periods by Chubb Life. Had the
fees not been waived and expenses not been assumed, the ratios of expenses
to average net assets would have been 1.70% in 1995, 1.73% in 1994, 1.93%
in 1993, 2.41% in 1992, 2.50% in 1991, 1990 and 1989, and 2.00% in 1988
and 1987, pursuant to the most restrictive state limitation.
(C) There were no purchases and/or sales of securities in 1987 other than
short-term obligations during the period. Therefore, the portfolio
turnover rate has not been calculated.
(D) Per share data calculated from the date shares of the Total Return Fund
were first sold to the public on December 18, 1987. Ratios to average net
assets have been annualized.
(E) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS IN THE STATEMENT OF ADDITIONAL INFORMATION.
6
<PAGE>
FINANCIAL HIGHLIGHTS--(CONTINUED)
For a share outstanding throughout the year:
<TABLE>
<CAPTION>
CHUBB TAX-EXEMPT FUND
-------------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31,
-------------------------------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988 1987(D)
----------- ----------- ----------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of
year............. $ 11.220 $ 12.580 $ 11.740 $ 11.380 $ 10.880 $ 11.010 $ 10.680 $ 10.110 $ 10.002
INCOME FROM
INVESTMENT
OPERATIONS
Net investment
income........... .621 .618 .583 .619 .634 .653 .773 .792 .037
Net realized and
unrealized gains
(losses) on
securities....... 1.132 (1.360) .850 .401 .500 (.115) .426 .571 .108
----------- ----------- ----------- ---------- ---------- ---------- ---------- ---------- ----------
Total from
investment
operations....... 1.753 (.742) 1.433 1.020 1.134 .538 1.199 1.363 .145
LESS DISTRIBUTIONS
TO SHAREHOLDERS
Dividends from
net investment
income.......... (.621) (.618) (.583) (.619) (.634) (.653) (.773) (.792) (.037)
Dividends in
excess of net
investment
income..........
Distributions
from capital
gains........... (.010) (.004) (.041) (.015) (.096) (.001)
Distributions in
excess of
capital gains... (.012) (.006)
Returns of
capital.........
----------- ----------- ----------- ---------- ---------- ---------- ---------- ---------- ----------
Total
distributions... (.643) (.618) (.593) (.660) (.634) (.668) (.869) (.793) (.037)
----------- ----------- ----------- ---------- ---------- ---------- ---------- ---------- ----------
Net asset value,
end of year...... $ 12.330 $ 11.220 $ 12.580 $ 11.740 $ 11.380 $ 10.880 $ 11.010 $ 10.680 $ 10.110
=========== =========== =========== ========== ========== ========== ========== ========== ==========
Total Return (A).. 15.88% (5.97%) 12.42% 9.19% 10.71% 5.10% 11.58% 14.06% 1.37%(E)
RATIOS TO AVERAGE
NET ASSET:
Expenses (B)..... 1.00% 1.00% 1.00% 1.00% 1.00% 1.05% -- -- --
Net investment
income.......... 5.20% 5.21% 4.81% 5.40% 5.80% 6.15% 7.32% 7.70% 5.91%
Portfolio Turnover
Rate (C)......... 7.39% 8.37% 1.55% 17.11% 4.41% 26.13% 14.14% 13.06% --
Net Assets, At End
of Year.......... $15,259,349 $13,973,939 $16,406,372 $9,250,893 $6,734,020 $4,326,788 $3,004,074 $1,569,279 $1,112,656
</TABLE>
- -------
(A) Total return assumes reinvestment of all dividends during the year and
does not reflect deduction of sales charge. Investment returns and
principal values will fluctuate and shares, when redeemed, may be worth
more or less than the original cost.
(B) A portion of all related party fees of the Fund have been waived for 1995,
1994 and 1993. All related party fees have been waived and all other
expenses of the Fund have been assumed in part for 1992, 1991 and 1990,
and in their entirety for the prior fiscal periods by Chubb Life. Had the
fees not been waived and expenses not been assumed, the ratios of expenses
to average net assets would have been 1.79% in 1995, 1.80% in 1994, 1.97%
in 1993, 2.42% in 1992, 2.50% in 1991, 1990 and 1989, and 2.00% in 1988
and 1987, pursuant to the most restrictive state limitation.
(C) There were no purchases and/or sales of securities in 1987 other than
short-term obligations during the period. Therefore, the portfolio
turnover rate has not been calculated.
(D) Per share data calculated from the date shares of the Tax-Exempt Fund were
first sold to the public on December 10, 1987. Ratios to average net
assets have been annualized.
(E) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS IN THE STATEMENT OF ADDITIONAL INFORMATION.
7
<PAGE>
FINANCIAL HIGHLIGHTS--(CONTINUED)
For a share outstanding throughout the year:
<TABLE>
<CAPTION>
CHUBB GROWTH AND INCOME FUND
---------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988 1987(D)
----------- ----------- ----------- ---------- ---------- ---------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year..... $ 14.770 $ 16.700 $ 15.140 $ 14.830 $ 11.950 $ 13.040 $ 10.830 $ 10.580 $ 10.610
INCOME FROM INVESTMENT
OPERATIONS
Net investment
income............... .204 .247 .277 .214 .243 .244 .385 .246 .017
Net realized and
unrealized gains
(losses) on
securities........... 5.042 (.954) 2.039 .794 3.756 (.664) 3.080 .229 (.027)
----------- ----------- ----------- ---------- ---------- ---------- -------- -------- --------
Total from investment
operations........... 5.246 (.707) 2.316 1.008 3.999 (.420) 3.465 .475 (.010)
LESS DISTRIBUTIONS TO
SHAREHOLDERS
Dividends from net
investment income.... (.204) (.247) (.277) (.214) (.243) (.244) (.414) (.225) (.020)
Dividends in excess of
net investment
income...............
Distributions from
capital gains........ (.885) (.976) (.479) (.484) (.876) (.426) (.841)
Distributions in
excess of capital
gains................ (.346)
Returns of capital.... (.001)
----------- ----------- ----------- ---------- ---------- ---------- -------- -------- --------
Total distributions... (1.436) (1.223) (.756) (.698) (1.119) (.670) (1.255) (.225) (.020)
----------- ----------- ----------- ---------- ---------- ---------- -------- -------- --------
Net asset value, end of
year.................. $ 18,580 $ 14.770 $ 16.700 $ 15.140 $ 14.830 $ 11.950 $ 13.040 $ 10.830 $ 10.580
=========== =========== =========== ========== ========== ========== ======== ======== ========
Total Return (A)....... 35.52% (4.26%) 15.29% 6.84% 33.48% (3.36%) 32.08% 4.43% (0.09)(E)
ASSET:
Expenses (B).......... 1.08% 1.00% 1.00% 1.00% 1.00% 1.04% -- -- --
Net investment
income............... 1.20% 1.66% 2.04% 1.82% 2.34% 2.78% 3.35% 3.72% 3.27%
Portfolio Turnover Rate
(C)................... 37.59% 46.17% 81.96% 87.87% 152.56% 152.93% 135.04% 86.62% --
Net Assets, At End of
Year.................. $29,144,161 $18,679,228 $14,885,337 $9,457,836 $4,445,996 $1,758,808 $961,395 $655,146 $106,776
</TABLE>
- -------
(A) Total return assumes reinvestment of all dividends during the year and
does not reflect deduction of sales charge. Investment returns and
principal values will fluctuate and shares, when redeemed, may be worth
more or less than the original cost.
(B) A portion of all related party fees of the Fund have been waived for 1995,
1994, and 1993. All related party fees have been waived and all other
expenses of the Fund have been assumed in part for 1992, 1991 and 1990,
and in their entirety for the prior fiscal periods by Chubb Life. Had the
fees not been waived and expenses not been assumed, the ratios of expenses
to average net assets would have been 1.69% in 1995, 1.71% in 1994, 1.92%
in 1993, 2.50% in 1992, 1991, 1990 and 1989, and 2.00% in 1988 and 1987,
pursuant to the most restrictive state limitation.
(C) There were no purchase and/or sales of securities in 1987 other than
short-term obligations during the period. Therefore, the portfolio
turnover rate has not been calculated.
(D) Per share data calculated from the date shares of the Growth and Income
Fund were first sold to the public on December 18, 1987. Ratios to average
net assets have been annualized.
(E) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS IN THE STATEMENT OF ADDITIONAL INFORMATION.
8
<PAGE>
FINANCIAL HIGHLIGHTS--(CONTINUED)
For a share outstanding throughout the year:
<TABLE>
<CAPTION>
CHUBB CAPITAL APPRECIATION FUND
-------------------------------
PERIOD FROM
SEPTEMBER 1,
1995 THROUGH
DECEMBER
31, 1995 (C)
-------------------------------
<S> <C>
Net asset value, beginning of year............. $ 10.000
INCOME FROM INVESTMENT OPERATIONS SECURITIES
Net investment income......................... 0.037
Net realized and unrealized gains (losses) on
securities................................... 0.422
----------
Total from investment operations.............. 0.459
LESS DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income.......... (0.037)
Dividends in excess of net investment income..
Distributions from capital gains.............. (0.022)
Distributions in excess of capital gains......
Returns of capital............................
----------
Total distributions........................... (0.059)
----------
Net asset value, end of year................... $ 10.400
==========
Total Return (A).............................. 4.60%(D)
RATIOS TO AVERAGE NEW ASSETS (ANNUALIZED)
Expenses (B).................................. 1.25%
Net investment income......................... 1.38%
Portfolio Turnover Rate........................ 2.73%
Net Assets, At End of Year..................... $1,596,254
</TABLE>
- -------
(A) Total return assumes reinvestment of all dividends during the year and
does not reflect deduction of sales charge. Investment returns and
principal values will fluctuate and shares, when redeemed, may be worth
more or less than the original cost.
(B) A portion of all related party fees of the Fund have been waived for 1995.
Had the fees not been waived and expenses not been assumed, the ratios of
expenses to average net assets would have been 2.50% in 1995; pursuant to
the most restrictive state limitation.
(C) Per share data calculated from the date shares of the Capital Appreciation
Fund were first sold to the public on: September 1, 1995. Ratios to
average net assets have been annualized.
(D) Not Annualized.
SEE NOTES TO FINANCIAL STATEMENTS IN THE STATEMENT OF ADDITIONAL INFORMATION.
9
<PAGE>
FINANCIAL HIGHLIGHTS--(CONTINUED)
For a share throughout the year:
<TABLE>
<CAPTION>
CHUBB GLOBAL INCOME FUND
------------------------
PERIOD FROM
SEPTEMBER 1,
1995 THROUGH
DECEMBER
31, 1995 (C)
------------------------
<S> <C>
Net asset value, beginning of year.................... $ 10.000
INCOME FROM INVESTMENT OPERATIONS
Net investment income................................ 0.116
Net realized and unrealized gains (losses) on
securities.......................................... 0.210
-----------
Total from investment operations..................... 0.326
LESS DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income................. (0.116)
Dividends in excess of net investment income.........
Distributions from capital gains.....................
Distributions in excess of capital gains.............
Returns of capital...................................
-----------
Total distributions.................................. (0.116)
-----------
Net asset value, end of year.......................... $ 10.210
===========
Total Return (A)..................................... .327%(D)
RATIOS TO AVERAGE NET ASSETS:
(ANNUALIZED)
Expenses (B)......................................... 1.75%
Net investment income................................ 4.48%
Portfolio Turnover Rate............................... 14.16%
Net Assets, At End of Year............................ $10,705,562
</TABLE>
- -------
(A) Total return assumes reinvestment of all dividends during the year and
does not reflect deduction of sales charge. Investment returns and
principal values will fluctuate and shares, when redeemed, may be worth
more or less than the original cost.
(B) A portion of all related party fees of the Fund have been waived for 1995.
Had the fees not been waived and expenses not been assumed, the ratios of
expenses to average net assets would have been 2.14% in 1995; pursuant to
the most restrictive state limitation.
(C) Per share data calculated from the date shares of the Global Income Fund
were first sold to the public on September 1, 1995. Ratios to average net
assets have been annualized.
(D) Not Annualized.
SEE NOTES TO FINANCIAL STATEMENTS IN THE STATEMENT OF ADDITIONAL INFORMATION.
10
<PAGE>
GENERAL DESCRIPTION
Chubb Investment Funds, Inc. (the "Company") is currently composed of seven
separate Funds, namely the Chubb Money Market Fund ("Money Market Fund"), the
Chubb Government Securities Fund ("Government Securities Fund"), the Chubb
Total Return Fund ("Total Return Fund"), the Chubb Tax-Exempt Fund ("Tax-
Exempt Fund"), the Chubb Growth and Income Fund, formerly known as the Chubb
Growth Fund, ("Growth and Income Fund"), the Chubb Capital Appreciation Fund
(the "Capital Appreciation Fund"), the Chubb Global Income Fund (the "Global
Income Fund") (collectively, the "Funds"). Each Fund is a distinct portfolio
of investments having its own investment objectives and policies.
The investment manager with respect to each Fund is Chubb Asset Managers,
Inc. (the "Investment Manager"), a wholly-owned subsidiary of The Chubb
Corporation. The investment administrator with respect to each Fund is Chubb
Investment Advisory Corporation (the "Investment Administrator"), a wholly-
owned subsidiary of Chubb Life Insurance Company of America ("Chubb Life"),
which is a wholly-owned subsidiary of The Chubb Corporation.
The distributor of the shares of the Company is Chubb Securities Corporation
(the "Distributor"), a New Hampshire corporation, which is a wholly-owned
subsidiary of Chubb Life. The Distributor is registered as a broker-dealer
with the Securities and Exchange Commission and is a member of the National
Association of Securities Dealers. The Distributor is registered as a broker-
dealer in 50 states, the District of Columbia, the U.S. Virgin Islands, Guam
and Puerto Rico.
PERFORMANCE AND YIELD INFORMATION
From time to time, the Company may advertise the yield and/or the average
total return of some or all of its seven funds; the Tax-Exempt Fund may
advertise tax equivalent yields, as well. These figures are based on
historical information and are not intended to indicate future performance.
The Money Market Fund's yield quotations represent the Fund's investment
income, less expenses, expressed as a percentage of assets on an annualized
basis for a specified seven-day period. The yield is expressed as both a
simple annualized yield and a compound effective yield. The yield for the non-
money market Funds is calculated by dividing the specified Fund's net
investment income per share during a recent 30-day period by the maximum
offering price per share of that Fund on the last day of the period.
The average annual total return quotations of the Funds are determined by
computing the average annual percentage change in value of a $1,000
investment, made at the maximum current public offering price for certain
specified periods. This computation assumes (i) reinvestment of all dividends
and distributions in shares of the Fund and (ii) all recurring fees are
included for applicable periods and the maximum current sales load is deducted
from the initial investment.
INVESTMENT OBJECTIVES AND POLICIES
The investment objectives of each Fund, and certain fundamental restrictions
which are discussed in the Statement of Additional Information, may not be
changed without the approval of the shareholders of the Fund that is affected
by such change. The investment policies of a Fund used to achieve the Fund's
objectives that are non-fundamental may be changed by the Company's Board of
Directors without the approval of the shareholders.
Each Fund's investments will be subject to market fluctuations and risks
inherent in all securities, and there can be no assurance that a Fund's stated
objectives will be realized.
Chubb Money Market Fund
Investment Objectives. The investment objective of the Money Market Fund is
to seek the highest possible level of current income as is consistent with the
preservation of capital and the maintenance of liquidity by investing
primarily in short-term high-grade debt obligations.
Investment Policies. The Money Market Fund invests only in securities with
remaining maturities of 13 months or less that present minimal credit risk and
are "eligible securities" as defined by Rule 2a-7 of the 1940 Act. "Eligible
Securities" must present minimal credit risks and, at the time of acquisition,
must be (1) securities which have been rated in
11
<PAGE>
one of the two highest rating categories by at least two nationally recognized
statistical rating organizations ("NRSROs"), such as Moody's Investors
Services, Inc. ("Moody's") or Standard & Poor's Corporation ("Standard &
Poor's"), that have issued a rating with respect to such securities or issuers
of such securities or by one NRSRO if that security or issuer has been rated
only by one NRSRO ("Requisite NRSRO's") or (2) unrated securities of
comparable investment quality. The Fund will invest at least 95% of its total
assets in eligible securities that are rated or whose issuers are rated within
the highest rating category for short-term debt obligations by the requisite
NRSROs or unrated securities of comparable quality. Such eligible securities
include, primarily, debt obligations that are issued or guaranteed as to the
timely payment of principal and interest by the United States Government (such
as U.S. Treasury bills, notes and bonds), its agencies (such as the Federal
Housing Administration and the Government National Mortgage Association), or
its instrumentalities (such as the Federal Home Loan Bank and the Federal
National Mortgage Association), and short-term corporate debt (such as
commercial paper). The Money Market Fund may also invest in (1) time deposits
having remaining maturities of seven (7) days or less of banks, including
foreign branches of United States banks and United States branches of foreign
banks, (2) certificates of deposit of banks which are members of the Federal
Deposit Insurance Corporation, including foreign branches of United States
banks and United States branches of foreign banks, (3) banker's acceptances,
or other bank obligations that are collateralized by underlying merchandise
issued by banks, and (4) Canadian, German, British or Japanese government
treasury bills issued and guaranteed as to the timely payment of principal and
interest by the respective country's government and payable in United States
dollars with remaining maturities of 13 months or less at the time of
purchase. For a discussion of certain risks involving U.S. dollar-denominated
foreign money market securities, see "SPECIAL INVESTMENT PRACTICES--Foreign
Securities" below. Foreign obligations purchased by the Fund will be limited
to 10% of the Fund's total assets. The Money Market Fund may also enter into
repurchase agreements involving the types of securities listed above. See
"SPECIAL INVESTMENT PRACTICES" below.
The Investment Manager will select investments, taking into consideration
rates, terms, and marketability of obligations as well as the capitalization,
earnings, liquidity, and other indicators of the financial condition of the
issuers. Because the market value of debt obligations fluctuates as an inverse
function of changing interest rates, the Money Market Fund seeks to minimize
the effect of such fluctuations by investing in instruments with remaining
maturities of 13 months or less.
The Money Market Fund's price per share will be determined in accordance
with the amortized cost valuation method, under which the Fund will maintain a
dollar-weighted average portfolio maturity of 90 days or less and will attempt
to maintain a constant net asset value of $1.00 per share.
Risk Factors. The principal risk factors associated with an investment in
the Money Market Fund are the risk of fluctuations in short-term interest
rates and the risk of default among one or more issuers of securities which
comprise the Money Market Fund's assets. Both the financial and market risks
of an investment in the Money Market Fund are expected to be less than those
for the other six Funds.
Chubb Government Securities Fund
Investment Objectives. The objective of the Government Securities Fund is to
earn as high a level of income as is consistent with maintaining safety of
principal by investing exclusively in debt obligations issued, guaranteed or
collateralized by the United States Government, its agencies or
instrumentalities.
Investment Policies. The Government Securities Fund invests in a variety of
U.S. Treasury obligations, which may differ in their interest rate, maturities
and time of issuance, including U.S. Treasury bills with a maturity of 1 year
or less, U.S. Treasury notes with a maturity of 1 to 10 years and U.S.
Treasury bonds with a maturity in excess of 10 years.
The Government Securities Fund also invests in debt obligations which are
issued, collateralized or guaranteed by the United States Government, its
agencies or instrumentalities, such as: (1) Government National Mortgage
Association ("GNMA") mortgage-backed pass-through certificates ("Ginnie Maes")
that are guaranteed as to timely payment of interest and principal by GNMA and
backed by the full faith and credit of the United States Treasury; (2)
mortgage-backed pass-through securities guaranteed as to the timely payment of
interest and the full return of principal by the Federal Home Loan Mortgage
Corporation ("FHLMC"), a corporate instrumentality of the United States
Government; (3) debt of each of the Federal Home Loan Banks, instrumentalities
of the United States Government which have the right to borrow a specific
amount from the United States Treasury; and (4) pass-through debt certificates
("Fannie Maes") issued and guaranteed as to timely payment of principal and
interest by the Federal National Mortgage Association ("FNMA"), a government-
sponsored corporation owned by private stockholders and supported by FNMA's
right to borrow from the U.S. Treasury, at the discretion of the U.S.
Treasury, and (5) other types of mortgage-backed securities issued by
governmental entities, such
12
<PAGE>
as FHLMC and FNMA, including collateralized mortgage obligations ("CMOs") and
real estate mortgage investment conduits ("REMICs"). CMOs are bond-like
securities collateralized by conventional mortgages, issued in multiple
classes, thus providing investors with either short, intermediate or long
maturities. REMICs, created under the Tax Reform Act of 1986, are similar in
structure to CMOs and are used as conduits for holding fixed pool of mortgages
secured by real property. REMICs may issue multiple classes of interests. The
Government Securities Fund will not invest in residual interests of REMICs and
CMOs due to the volatile nature of such investments. Obligations of FHLMC and
FNMA are not backed by the full faith and credit of the United States
Treasury. While the United States Government provides financial support to
government-sponsored agencies and instrumentalities, there can be no assurance
that it will continue to do so since it is not obligated to by law. The
Government Securities Fund may also enter into repurchase agreements
collateralized by the securities listed above. See "SPECIAL INVESTMENT
PRACTICES" below.
The Government Securities Fund may enter into agreements with certain
broker-dealers, with respect to no more than 10% of the Fund's total assets,
to buy United States Government securities for future delivery. When such
transactions are negotiated, the price is fixed at the time of commitment, but
delivery and payment for the securities can take place a month or more after
the date of the commitment to purchase. Contracts that provide for the future
delivery of securities on a "forward commitment," "when-issued" or a "delayed
delivery basis" are usually purchased at a price lower than the current market
price for similar mortgage instruments having the same interest rate. The
securities are subject to market fluctuation and no interest accrues to the
purchaser during this period. At the time of delivery of the securities, their
value may be more or less than the purchase price. The Fund will normally
receive a fee for entering into forward commitment contracts. See "DESCRIPTION
OF CERTAIN INVESTMENTS" in the Statement of Additional Information.
In order to enhance current income or reduce market interest rate risks, the
Government Securities Fund may engage in a variety of hedging strategies
involving the use of exchange-traded options and futures transactions. The
Government Securities Fund may, at times, write covered call options or
purchase put options with respect to certain of its portfolio securities, and
will purchase or write such options on interest rate futures contracts and
appropriate securities indexes. The Government Securities Fund may also
purchase or sell interest rate futures contracts. In addition, the Government
Securities Fund may also enter into closing purchase and sale transactions
with respect to such options and futures. See "SPECIAL INVESTMENT PRACTICES"
below regarding the Fund's use of options and futures contracts and risk
considerations involving such instruments.
The Investment Manager anticipates that the Fund's average portfolio
maturity will not exceed 15 years, with the precise term to maturity dependent
upon general market and economic conditions.
Risk Factors. The value of the debt securities held by the Government
Securities Fund will change as interest rates fluctuate. An increase in market
interest rates or prior payment of mortgage-backed securities will generally
reduce the value of this Fund's investments, and a decline in market interest
rates will generally increase the value of this Fund's investments. GNMA
securities and other mortgage-backed securities in which the Fund invests, may
not be an effective means of "locking in" long-term interest rates as the Fund
must reinvest scheduled and unscheduled principal payments. At the time
principal payments or prepayments are received by the Fund and reinvested,
prevailing interest rates may be higher or lower than the Fund's current
yield. As a result, the income or yield of the Government Securities Fund
under such circumstances may vary significantly.
Chubb Total Return Fund
Investment Objectives. The objective of the Total Return Fund is to produce
the highest total return through a combination of income and capital
appreciation as is consistent with reasonable risk by investing in a portfolio
of income-producing debt and equity securities.
Investment Policies. To achieve its objective, the Total Return Fund intends
to invest between 30% and 70% of its assets in equity securities and bonds,
notes, warrants or preferred stocks that can be exchanged for or converted
into common stocks, depending upon market and economic conditions. The Fund
will not restrict its investments in equity securities of companies to any
particular capitalization. In its equity investments, the Fund will emphasize
issues with relatively low price to earnings ratios, above average dividend
yields, and relatively low price to book value ratios, as compared to such
ratios and yields for the market in general. The balance of the Total Return
Fund, except assets invested for defensive or hedging purposes, will be
invested in rated or unrated fixed income securities, including obligations of
the United States Government, and its agencies or instrumentalities, and
corporate debt obligations which are rated Baa or BBB or higher by Moody's,
Standard & Poor's or other NRSROs or, if not rated, are of equivalent quality
as determined by the Fund's Investment
13
<PAGE>
Manager. Debt securities rated Baa or BBB by Moody's or Standard & Poor's are
considered by these rating agencies to be investment-grade obligations and are
regarded as having adequate capacity to pay interest and repay principal,
although adverse economic conditions or changing circumstances are more likely
to lead to a weakening of such capacity than would be the case for higher-
grade bonds. Such bonds may be considered to have certain speculative
characteristics. In the event that the ratings of securities held by the Fund
fall below investment grade, the Fund will not be obligated to dispose of such
securities and may continue to hold such securities if, in the opinion of the
Investment Manager, such investment is considered appropriate under the
circumstances. The Investment Manager anticipates that the average portfolio
maturity of the Fund's fixed income securities will not exceed 15 years, with
the precise term to maturity dependent upon general market and economic
conditions.
The Total Return Fund will invest primarily in equity and debt securities of
domestic issuers, as described above. However, when deemed appropriate by the
Investment Manager, the Fund may invest in and hold up to 20% of its total
assets in equity and debt securities of foreign issuers. Such securities may
include exchange-traded and over-the-counter securities of foreign issuers and
American Depositary Receipts ("ADRs"). Such securities may be traded in the
United States or in foreign markets. For purposes hereof, securities of
foreign issuers means securities of issuers organized or whose principal place
of business is outside the United States, or whose securities are principally
traded in securities markets outside the United States. The Fund's investments
in foreign securities primarily will be in equity securities but also may
include investment grade debt obligations of foreign companies and
governments. See "SPECIAL INVESTMENT PRACTICES" below and "DESCRIPTION OF
CERTAIN INVESTMENTS--Foreign Securities" and "American Depositary Receipts" in
the Statement of Additional Information.
For hedging purposes, the Total Return Fund may write covered call options
and purchase put options with respect to certain of its portfolio securities,
and will purchase and write such options on interest rate futures contracts,
stock index futures contracts and appropriate securities indexes. The Total
Return Fund may also purchase or sell futures contracts, including stock index
futures contracts or interest rate futures contracts. The Fund may also enter
into closing transactions with respect to such options and futures contracts.
See "SPECIAL INVESTMENT PRACTICES" below regarding the Fund's use of options
and futures contracts and risk considerations involving such instruments.
For temporary or defensive purposes, the Fund may hold a portion of its
assets in cash, high-grade money market instruments or U.S. Treasury bills, or
in repurchase agreements. See "SPECIAL INVESTMENT PRACTICES" below.
Risk Factors. The price of the equity securities in which the Total Return
Fund invests will fluctuate day to day and, as a result, the value of an
investment in the Total Return Fund will vary based upon such market
conditions. The value of the Total Return Fund's investment in fixed income
securities will vary depending on such factors as prevailing interest rates.
Moreover, in the case of debt securities, investments are subject to the
ability of the issuer to make payments of principal and interest when due.
Although the Total Return Fund seeks to reduce both financial and market risks
associated with any one investment medium, performance of the Fund will depend
on such additional factors as timing the mix of investments and the ability of
the Investment Manager to react to changing market conditions.
Chubb Tax-Exempt Fund
Investment Objectives. The objective of the Tax-Exempt Fund is to provide a
stable level of current income which is exempt from Federal income taxes,
consistent with the preservation of capital, by investing primarily in
investment-grade tax-exempt securities.
Investment Policies. It is a fundamental policy of the Tax-Exempt Fund to
invest, under normal market conditions, at least 80% of its assets in tax-
exempt securities. As part of this policy, in determining whether the Fund has
invested at least 80% of its assets in tax-exempt securities, obligations on
which the interest is treated as an item of tax preference for purposes of the
alternative minimum tax are not counted as tax-exempt securities.
To achieve its investment objective, the Fund will invest primarily in: (1)
municipal bonds or notes, which, on the date of investment, have received one
of the four highest ratings issued by Moody's (Aaa, Aa, A and Baa), Standard &
Poor's (AAA, AA, A and BBB), or other NRSROs or, if not rated, are of
comparable quality to obligations so rated in the judgment of the Investment
Manager; and (2) short-term tax-exempt instruments, having a maturity of 13
months or less, which have received one of the three highest possible ratings
issued by either Moody's or Standard & Poor's (MIG 1, MIG 2, MIG 3 or SP-1,
SP-2, SP-3), or, if not rated, are of comparable quality to obligations so
rated in the judgment of the Investment Manager. Securities rated Baa or BBB
by Moody's or Standard & Poor's are considered to be investment-grade
obligations
14
<PAGE>
and are regarded as having adequate capacity to pay interest and repay
principal, although adverse economic conditions or changing circumstances are
more likely to lead to a weakening of such capacity than for higher-grade
bonds. Such securities may be considered to have certain speculative
characteristics. In the event that the ratings of securities held by the Fund
fall below investment grade, the Fund will not be obligated to dispose of such
securities and may continue to hold such securities if, in the opinion of the
Investment Manager, such investment is considered appropriate under the
circumstances. The Investment Manager anticipates that, over time, the average
portfolio maturity will approximate 20 years, with the precise time to
maturity dependent upon general market and economic conditions.
Of the amount of the Fund's assets invested in tax-exempt securities, the
Investment Manager expects that under normal market and economic conditions at
least 65% of such assets will be invested in high-grade tax-exempt bonds which
have received one of the three highest ratings by Moody's, Standard & Poor's
or other NRSROs or, if not rated, will be of comparable quality to obligations
so rated in the judgment of the Investment Manager.
The Fund may enter into agreements with banks or broker-dealers to purchase
some securities on a "forward commitment," "when issued" or on a "delayed
delivery" basis. Such agreements involve a commitment to purchase securities
at a price that is fixed at the time of commitment for delivery at a future
date, which may be up to three months in the future. The Fund will not pay for
the securities or begin earning interest on them until the securities are
received. The securities so purchased are subject to market fluctuations so
that at the time of delivery, the value of such securities may be more or less
than the purchase price.
The Tax-Exempt Fund may endeavor to reduce risks to the Fund's assets
resulting from interest rate fluctuations and market volatility by writing
covered call options and purchasing put options with respect to certain of its
portfolio securities and appropriate securities indexes and interest rate
futures contracts. The Tax-Exempt Fund may also purchase and sell municipal
bond futures contracts, including Municipal Bond Index Futures, which involves
an investment in an index composed of the average prices of 40 selected
municipal bonds. The Fund may also enter into closing transactions with
respect to such options and futures contracts. See "SPECIAL INVESTMENTS
PRACTICES" below regarding the Fund's use of options and futures contracts and
risk considerations involving such instruments. The Tax-Exempt Fund may invest
up to 20% of its assets in taxable securities for liquidity or for temporary
defensive purposes, although at least 80% of the Fund's income during each
year will be derived from tax-exempt securities. Taxable investments may
consist of United States Government securities, securities of United States
Government agencies and instrumentalities, bank certificates of deposit and
banker's acceptances, short-term corporate debt securities such as commercial
paper, and repurchase agreements. See "DESCRIPTION OF CERTAIN INVESTMENTS" in
the Statement of Additional Information.
Risk Factors. Although dividends to shareholders from the Tax-Exempt Fund
will generally be exempt from Federal income taxes, distributions of income
from investments in taxable securities and capital gains, if any, realized by
the Tax-Exempt Fund would be taxable to the shareholder. Moreover,
distributions paid to shareholders of the Tax-Exempt Fund may be subject to
state and local taxation. The value of the Tax-Exempt Fund's investments will
vary inversely with prevailing interest rates and may vary according to such
factors as the credit quality and maturity of the portfolio.
Chubb Growth and Income Fund
Investment Objectives. The objective of the Growth and Income Fund is to
seek long-term growth by investing primarily in a wide range of equity issues
that the Investment Manager believes will offer possibilities of capital
appreciation and, secondarily, to seek a reasonable level of current income.
Investment Policies. The Growth and Income Fund intends to invest at least
80% of its assets in common stocks and other equity securities such as
preferred stocks and securities convertible into common stock which are either
listed on the New York Stock Exchange, traded over-the-counter or, to a lesser
extent, listed on other national securities exchanges. Securities are selected
principally for potential appreciation, based upon such criteria as relatively
low price to earnings ratio and relatively low price to book value ratio, as
compared to such ratios for the market in general and, secondarily, for
current income and increasing future dividends. While the Growth and Income
Fund intends to invest at least 60% of its assets in securities which have
paid dividends or interest within the preceding 12 months, the Fund may invest
in securities not currently paying dividends where the Investment Manager
anticipates that they will increase in value.
The Growth and Income Fund may also invest for temporary or defensive
purposes in high-grade debt securities and money market securities, including
United States Government securities, commercial paper and bank obligations,
and repurchase agreements.
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The Growth and Income Fund will invest primarily in equity securities issued
by United States companies. However, when deemed appropriate by the Investment
Manager, the Fund may invest in and hold up to 20% of its total assets in
equity and debt securities of foreign issuers. Such securities may include
exchange-traded and over-the-counter securities of foreign issuers, American
Depositary Receipts ("ADRs") European Depositary Receipts ("EDRs") and Global
Depositary Receipts ("GDRs") (collectively "Depositary Receipts"). Such
securities may be traded in the United States or in foreign markets. For
purposes hereof, securities of foreign issuers means securities of issuers
organized or whose principal place of business is outside the United States,
or whose securities are principally traded in securities markets outside the
United States. The Fund's investments in foreign securities primarily will be
in equity securities issued by companies organized or located outside the
United States, but may also include investment grade debt obligations issued
by foreign companies and governments. See "SPECIAL INVESTMENT PRACTICES" below
and "DESCRIPTION OF CERTAIN INVESTMENTS--Foreign Securities" and "Depositary
Receipts" in the Statement of Additional Information.
The Growth and Income Fund may write covered call options or purchase put
options with respect to certain of its portfolio securities or purchase stock
index options for hedging purposes or to enhance income. The Growth and Income
Fund may also purchase or write futures contracts, including stock index
futures contracts. The Fund may also enter into closing transactions with
respect to such options and futures contracts. See "SPECIAL INVESTMENT
PRACTICES" below regarding the Fund's use of options and futures contracts and
risk considerations involving such instruments.
Risk Factors. The prices of the securities purchased for the Growth and
Income Fund will tend to fluctuate more than the prices of securities
purchased for the other Funds. As a result, the net asset value of the Growth
and Income Fund may experience greater short-term and long-term variations
than such other Funds.
Chubb Capital Appreciation Fund
Investment Objectives. The objective of the Capital Appreciation Fund is to
seek long-term appreciation by investing primarily in equity securities of
companies that the Investment Manager believes will offer possibilities of
capital appreciation.
Investment Policies. The Capital Appreciation Fund intends to invest at
least 80% of its assets in common stocks and other equity securities such as
preferred stocks and securities convertible into common stock. The Capital
Appreciation Fund will only invest in convertible debt securities rated in the
three highest rating categories by any nationally recognized statistical
rating organization ("NRSRO") or comparable unrated securities. The Capital
Appreciation Fund intends to invest at least 65% of its total assets in
securities of companies that at the time of purchase have total market
capitalizations between $500 million and $2.5 billion. In selecting the Fund's
investments, the Investment Manager seeks to identify attractive investment
opportunities that have not become widely recognized by other analysts or the
financial press. Securities are selected principally for their capital
appreciation potential, based upon such criteria as relatively low price to
earnings ratio and relatively low price to book value, as compared to the
market in general. Current income and increasing future dividends are only
incidental or secondary considerations in seeking portfolio securities.
The Capital Appreciation Fund will invest primarily in equity securities
issued by domestic companies. However, when deemed appropriate by the
Investment Manager, the Fund may invest in and hold up to 20% of its total
assets in equity and debt securities of foreign issuers. Such securities may
include exchange-traded and over-the-counter securities of foreign issuers and
Depositary Receipts. Such securities may be traded in the United States or in
foreign markets. For purposes hereof, securities of foreign issuers means
securities of issuers organized or whose principal place of business is
outside the United States, or whose securities are principally traded in
securities markets outside the United States. The Fund's investments in
foreign securities primarily will be in equity securities issued by companies
organized or located outside the United States, but may also include
investment grade debt obligations issued by foreign companies and governments.
See "SPECIAL INVESTMENT PRACTICES" below and "DESCRIPTION OF CERTAIN
INVESTMENTS--Foreign Securities" and "Depositary Receipts" in the Statement of
Additional Information.
The Capital Appreciation Fund may write covered call options and purchase
put options with respect to certain of its portfolio securities and purchase
stock index options for hedging purposes only and not for speculation. The
Capital Appreciation Fund may also purchase or write futures contracts,
including stock index futures contracts. The Fund may also enter into closing
transactions with respect to such options and futures contracts. These
investment techniques are considered derivative investing. See "SPECIAL
INVESTMENT PRACTICES" below regarding the Fund's use of derivatives such as
options and futures contracts and risk considerations involving such
instruments.
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The Capital Appreciation Fund may also invest for temporary defensive
purposes in high-grade debt securities and money market securities, including
United States Government securities, commercial paper and bank obligations,
and repurchase agreements. For more information regarding the Fund's
investments and risks see "DESCRIPTION OF CERTAIN INVESTMENTS" in the
Statement of Additional Information.
Risk Factors. The prices of the securities purchased for the Capital
Appreciation Fund will tend to fluctuate more than the prices of securities
purchased for certain of the other Funds, including in particular the Money
Market Fund, Government Fund and Tax-Exempt Fund. As a result, the net asset
value of the Capital Appreciation Fund may experience greater short-term and
long-term variations than such other Funds. Derivative securities can be
volatile investments and involve certain risks which may reduce the Fund's
returns.
Chubb Global Income Fund
Investment Objectives. The objective of the Global Income Fund is to seek
high current income and capital appreciation by investing primarily in debt
securities of domestic and foreign issuers.
Investment Policies. In pursuit of its investment objective, the Global
Income Fund will invest at least 65% of its assets in bonds and debentures.
The Fund may invest in debt securities issued by: (i) domestic and foreign
governments and their agencies and political subdivisions; (ii) corporations
and financial institutions, and (iii) supranational entities such as the
International Bank for Reconstruction and Development ("World Bank"), the
Asian Development Bank, the European Development Bank, and the European
Community. At least 75% of the Fund's debt securities will be rated investment
grade by Standard & Poor's Corporation ("S&P") or Moody's Investors Service,
Inc. ("Moody's"), or if unrated, deemed to be of comparable quality in the
judgment of the Investment Manager. No more than 25% of the Fund's total
assets may be invested in debt that is rated lower than investment grade (junk
bonds). The Fund will allocate its assets among debt securities of issuers in
three separate investment areas: (1) the United States, (2) developed foreign
countries, and (3) emerging markets. The Fund considers emerging markets to
include all countries except the United States, Canada, Japan, Australia, New
Zealand and most countries in Western Europe. See "Additional Risk Factors"
below. The Fund will select particular debt securities in each investment area
based upon their relative investment merit. Under normal conditions, the Fund
will have at least 65% of its total assets in at least three different
countries (one of which may be the United States). For temporary or defensive
purposes, the Fund may invest substantially all its assets in one or two
countries. Certain of the Fund's investments may have speculative
characteristics. See "Additional Risk Factors" below and "DESCRIPTION OF
CERTAIN INVESTMENTS" in the Statement of Additional Information.
The average maturity of debt securities in the Global Income Fund's
portfolio will fluctuate depending on the Investment Manager's judgment as to
future interest rates and market conditions.
The Global Income Fund may also buy and sell derivatives such as financial
futures contracts, bond index futures contracts, and foreign currency futures
contracts. The Global Income Fund may purchase and sell any of these futures
contracts for hedging purposes only and not for speculation. It may engage in
such transactions only if the total contract value of the futures contracts
does not exceed 20% of the Global Income Fund's total assets. In addition, the
Global Income Fund may invest in options on foreign currency exchange
contracts, options on foreign currencies, including cross currency hedges,
"when issued" securities and collateralized mortgage obligations, and lend up
to 30% of its portfolio securities. For more information about derivatives see
"Special Investment Practices" below.
For temporary or defensive purposes, the Fund may invest in high quality
domestic money market instruments, high quality domestic short-term debt
securities or may hold the Fund's assets in cash or cash equivalents without
limitation.
The Global Income Fund normally invests in a substantial number of issues;
however, the Global Income Fund is classified as "non-diversified" under the
Investment Company Act of 1940, as amended, (the "1940 Act") and the value of
its shares may fluctuate more than the shares of a diversified fund. (For More
Information See Additional Risk Factors)
SPECIAL INVESTMENT PRACTICES
Unless otherwise specified, each of the investment practices described in
this section is not deemed to be a fundamental objective and may be changed by
the Company's Board of Directors without approval of a majority of the
Company's outstanding shares. For a further explanation of each Fund's
investment practices and restrictions, including the types of
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such investments and the risks associated with such investments, see
"DESCRIPTION OF CERTAIN INVESTMENTS" in the Statement of Additional
Information.
Equity Securities
The Total Return Fund, Growth and Income Fund, Capital Appreciation Fund,
and the Global Income Fund each may invest in equity securities of companies
having various capitalizations, companies, having including small
capitalization companies (i.e., average market capitalizations below $500
million), mid-capitalization companies (i.e., average market capitalizations
below $500 million to $2.5 billion), and large capitalization companies (i.e.,
above $2.5 billion), although the Capital Appreciation Fund will be invested
primarily in securities of mid-capitalization. The Investment Manager believes
that equity securities of small and mid-capitalization companies may provide
greater growth potential than stocks of large capitalization companies.
Nevertheless, small and mid-capitalization companies often have limited
product lines, fewer market or financial resources, and may be more dependent
upon one person or a few key people for management. In addition, the stocks of
such small and mid-capitalization companies may be subject to greater price
volatility than large capitalization stocks both because such stocks typically
trade in lower volume and because such companies may be more vulnerable to
changing economic conditions than large capitalization companies.
Repurchase Agreements
All the Funds may enter into repurchase agreements, whereby an investor,
such as one of the Funds, purchases securities (referred to as "underlying
securities") from well-established securities broker-dealers or banks, subject
to agreement by the seller to repurchase the securities at a stated price on a
specified date. Repurchase agreements involve certain risks not associated
with direct investment in securities, including the risk that the original
seller will default on its obligations to repurchase, as a result of
bankruptcy or otherwise. To minimize this risk, a Fund will enter into
repurchase agreements only if the repurchase agreement is structured in a
manner reasonably designed to collateralize fully the value of a Fund's
investment during the entire term of the agreement and in accordance with
guidelines regarding the creditworthiness of the seller determined by the
Board of Directors of the Company. Currently, these guidelines require sellers
who are broker-dealers to have a net worth of at least $25,000,000, although
this requirement may be waived by the Board of Directors of the Company on the
recommendation of the Investment Manager and banks to have assets of at least
$1,000,000,000. The underlying security, held as collateral, will be marked to
market on a daily basis, and must be of high-quality. With respect to the
Money Market Fund, the underlying security must be either a United States
Government security or a security rated in the highest rating category by the
Requisite NRSROs and must be determined to present minimal credit risk.
Nevertheless, in the event that the other party to the agreement fails to
repurchase the securities subject to the agreement, a Fund could suffer a loss
to the extent proceeds from the sale of the underlying securities held as
collateral were less than the price specified in the repurchase agreement.
Reverse Repurchase Agreements
The Global Income Fund may enter into reverse repurchase agreements with the
same parties that it enters into repurchase agreements. Under a reverse
repurchase agreement, the Fund would sell portfolio securities and agree to
repurchase them at a particular price at a future date. At the time the Fund
enters into the reverse repurchase agreement it will establish and maintain a
segregated amount with the custodian containing cash or liquid securities
having a value not less than the repurchase price, including interest. Reverse
repurchase agreements involve risk that the market value of the securities
retained in lieu of the sale may decline below the price of the securities the
Fund has sold but is obligated to repurchase. In the event the buyer of
securities files for bankruptcy or becomes insolvent, such buyer or its
trustee or receiver may receive an extension of time to determine whether to
enforce the Fund's obligation to repurchase the securities and the Fund's use
of the proceeds of the reverse repurchase agreement may effectively be
restricted pending such decision. Reverse repurchase agreements will be
treated as borrowings for purpose of calculating the Fund's borrowing
limitations.
Foreign Securities, ADRs, EDRs and GDRs
Subject to the investment objectives and policies of each Fund, the Money
Market Fund, the Total Return Fund, the Growth and Income Fund, the Capital
Appreciation Fund and the Global Income Fund may invest in foreign securities.
Although investment in foreign securities by the Money Market Fund, the Total
Return Fund, the Growth and Income Fund, the Capital Appreciation Fund are
intended to reduce risk by providing further diversification, such
investments, as well as those of the Global Income Fund, involve certain
additional risks, including the possibility of: (1) adverse foreign political
and economic developments, (2) less publicly available information about
foreign issuers, (3) less comprehensive accounting,
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reporting and disclosure requirements, (4) less government regulation and
supervision of foreign stock exchanges, brokers and listed companies, (5)
expropriation or confiscatory taxation that could affect investments, (6)
currency blockages which would prevent cash from being brought back in the
United States, (7) generally higher brokerage and custodial costs than those
of domestic securities, (8) with respect to foreign securities denominated in
foreign currencies, the costs associated with the exchange of currencies and
the possibility of unfavorable changes in currency rates and exchange rate
regulations and (9) settlement of transactions being delayed beyond periods
customary in the United States.
The Total Return Fund, the Growth and Income Fund and Capital Appreciation
Fund may also invest in Depository Receipts, (ADRs, GDRs and EDRs.) ADRs are
certificates issued by a United States bank representing the right to receive
securities of a foreign issuer deposited in a foreign branch of a United
States bank and traded on a United States exchange or over-the-counter. EDRS
and GDRs are typically issued by foreign banks or trust companies, although
they may be by US banks or trust companies, and also evidence ownership of
underlying securities issued by a foreign or U.S. securities market.
Generally, Depositary Receipts in registered form are designed for use in the
U.S. securities market and Depositary Receipts in bearer form are designed for
use in securities markets outside the United States. Depositary Receipts may
not necessarily be denominated in the same currency as the underlying
securities in to which they may be converted. Depositary Receipts may be
issued pursuant to sponsored or unsponsored programs. In sponsored programs,
an issuer has made arrangements to have its securities traded in the form of
Depositary Receipts. In unsponsored programs the issuer may not be directly
involved in the creation of the program. In some cases it may be easier to
obtain financial information from an issuer that has participated in the
creation of the sponsored program. Accordingly, there may be less information
available regarding issuers of securities underlying unsponsored programs and
there may not be a correlation between such information and the market value
of the Securities. Brokerage commissions will be incurred if ADRs are
purchased through brokers on the U.S. stock exchanges.
Depositary Receipts also involve the risks of other investment in foreign
securities, for purposes of each Fund's investment policies, a Fund's
investment in Depositary Receipts will be deemed to be investments in the
underlying securities.
Lending of Portfolio Securities
The Global Income Fund may seek to increase its income by lending portfolio
securities. Under present regulatory policies such loans may be made to
institutions such as broker dealers, and are required to be secured
continuously by collateral in cash, cash equivalents or U.S. Government
securities maintained on a current basis in an amount at least equal to the
market value of the securities loaned. It is intended that the value of
securities loaned would not exceed 30% of the value of the total assets of the
Fund.
DERIVATIVES
A "derivative" is a financial contract whose value depends upon the value of
an underlying instrument or asset--a commodity, bond, mortgage, equity or
currency or a combination of these.
The Total Government Securities Fund, Return Fund, Growth and Income Fund,
Capital Appreciation Fund and Global Income Fund may utilize derivatives in
seeking to meet these investment objectives. The risks of derivative investing
are set forth below on pages 13 and 19-21.
Forward Foreign Currency Exchange Contracts and Options of Foreign Currencies
The Total Return Fund, Growth and Income Fund, Capital Appreciation Fund and
the Global Income Fund may enter into forward foreign currency exchange
contracts ("forward currency contracts") to attempt to minimize the risk to
the Fund from adverse changes in the relationship between the U.S. dollar and
foreign currencies. A foreign currency contract is an obligation to purchase
or sell a specific currency for an agreed price at a future date which is
individually negotiated and privately traded by currency traders and their
customers. The Total Return Fund, Growth and Income Fund and the Global Income
Fund may enter into a forward exchange contract when for example the Fund
enters into a contract for the purchase or sale of a security denominated in a
foreign currency in order to lock in the U.S. dollar price of the security or
the U.S. dollar equivalent of interest and dividends to be paid on such
securities, or to hedge against the possibility that the currency of a foreign
country in which a Fund has investments may suffer a decline against the U.S.
dollar. A forward contract is an obligation to purchase or sell a specific
currency at a future date, which may be any fixed number of days from the date
of
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the contract agreed upon by the parties, at a price set at the time of the
contract agreed upon by the parties, at a price set at the time of the
contract. For example, a Fund may purchase a particular security or enter into
a forward currency contract to preserve the U.S. dollar price of securities it
intends to or has contracted to purchase. Alternatively, the Fund might sell a
particular security on either a spot (cash) basis at the rate then prevailing
in the currency exchange market or on a forward basis by entering into a
forward contract to purchase or sell currency, to hedge against an anticipated
decline in the U.S. dollar value of securities it intends or has contracted to
sell. This method of attempting to hedge the value of the Fund's portfolio
securities against a decline in the value of a currency does not eliminate
fluctuations in the underlying prices of the securities. None of the Funds is
obligated to engage in any such currency hedging operations, and there may be
no assurance as to the success of any hedging operations, and there can be no
assurance as to the success of any hedging operations which a Fund may
implement. Although the strategy of engaging in foreign currency transactions
could reduce the risk of loss due to a decline in the value of the hedged
currency, it could also limit the potential gain from an increase in the value
of the currency. No Fund, except the Global Income Fund, intends to maintain a
net exposure to such contracts where the fulfillment of the Fund's obligations
under the contracts would obligate the Fund to deliver an amount of foreign
currency in excess of the value of the Fund's portfolio securities or other
assets denominated in that currency.
Cross Currency Hedges
The Global Income Fund may also enter into a form of foreign currency option
transaction known as cross hedges of currencies by entering into transactions
to purchase or sell one or more currencies that are expected to increase or
decline in value relative to other currencies in which the fund has or which
the fund expects to have exposure.
Writing Covered Call Options and Purchasing Put Options
In order to earn additional income or to protect partially against declines
in the value of its securities, all the Funds, except the Money Market Fund,
may write (sell) covered call options and purchase call options to the extent
necessary to close out option positions previously written by the Fund. A call
option gives the holder (purchaser) the right to buy and obligates the writer
(seller) to sell, in return for a premium paid, the underlying security at the
exercise price during the option period. The Funds, in keeping with their
individual investment objectives and policies, may write call options with
respect to individual equity securities and bonds, and stock and bond indexes
which correlate with the Fund's particular portfolio securities. The Funds
will write only covered call options which are listed on exchanges, and will
not write a covered call option if, as a result, the aggregate market value of
all portfolio securities covering all call options or subject to put options
exceeds 25% of the value of the Fund's total assets. The Funds cover options
they have sold for example, by holding the underlying securities or (the usual
practice in the case of a call) or by other means which would permit timely
satisfaction of the Fund's obligations as writer or the option, such as by
depositing in a separate account liquid high grade debt securities, or cash,
equal in value to the exercise price of the option (the usual practice in the
case of a put.)
All Funds, except the Money Market Fund, may also purchase put options with
respect to equity securities and bonds, and stock and bond indexes which
correlate with their portfolio securities, limited to no more than 5% of the
Fund's total assets. As the holder of a put option, the Fund has the right to
sell the underlying security at the exercise price at any time during the
option period.
The Global Income Fund may also purchase and write put and call options on
foreign currencies for the purpose of protecting against declines in the
dollar value of foreign portfolio securities and against the U.S. dollar cost
of foreign securities to be acquired. Use of forward currency contracts,
options and futures involve certain risks and transaction costs which it might
not otherwise be subject, including dependence on the Investment Manager's
ability to predict movements in the prices of currency markets. If the
Investment Manger incorrectly forecasts the currency exchange rates or
interest rates in utilizing a strategy for the Fund it would be in a better
position if it had never hedged at all. In addition certain provisions of the
Internal Revenue Code of 1986 have the effect of limiting the extent to which
the Fund may enter into foreward contracts or futures contracts or engage in
options transactions. (see Cross Currency Hedges above.)
Although these investment practices will be used to generate additional
income or to attempt to reduce the effect of any price decline in the security
subject to the option, they do involve certain risks that are different, in
some respects, from investment risks associated with similar funds which do
not engage in such activities. These risks include the following: writing
covered call options--the inability to effect closing transactions at
favorable prices and the inability to participate in the appreciation of the
underlying securities above the exercise price; and purchasing put options--
possible loss of the entire premium paid. In addition, the effectiveness of
hedging through the purchase of securities index options will depend upon the
extent to which price movement in the portion of the securities portfolios
being hedged correlate with price movements
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in the selected securities index. Perfect correlation may not be possible
because (i) the securities held or to be acquired by a Fund may not exactly
match the composition of the securities indexes on which options are written
or (ii) the price movements of the securities underlying the option may not
follow the price movements of the portfolio securities being hedged. If the
Investment Manager's forecasts regarding movements in securities prices or
interest rates or currency prices or other economic factors are incorrect, the
Fund's investment results may have been better without the hedge. A more
thorough description of these investment practices and their associated risks
is contained in the Company's Statement of Additional Information.
Futures Contracts. All the Funds, except the Money Market Fund, may purchase
and sell futures contracts on debt securities and indexes of debt securities
(i.e., interest rate futures contracts) as a hedge against or to minimize
adverse principal fluctuations resulting from anticipated interest rate
changes. The Funds may also, where appropriate, enter into stock index futures
contracts to provide a hedge for a portion of the Fund's equity holdings.
Stock index futures contracts may be used as a way to implement either an
increase or decrease in portfolio exposure to the equity markets in response
to changing market conditions. Each Fund may also write covered call options
and purchase put options on futures contracts of the type which that Fund is
permitted to purchase. The Global Income Fund may buy and sell foreign
currency futures contracts and bond index futures contracts. An index futures
contract is an agreement to take or make delivery of an amount of cash based
upon the difference between the value of the index at the beginning and the
end of the contract period. A futures contract on a foreign currency is an
agreement to buy or sell a specified amount of a currency at a set price on a
specified future date. The Funds will not enter into futures contracts for
speculation and will only enter into futures contracts that are traded on
national futures exchanges. No Fund will enter into futures contracts or
options thereon if immediately thereafter the sum of the amounts of initial
margin deposits on the Fund's existing futures contracts and premiums paid for
options on unexpired futures contracts would exceed 5% of the value of the
Fund's total assets.
When a Fund enters into a futures contract it must make an initial deposit
known as initial margin as a partial guarantee of its performance under the
contract, as the value of the contract fluctuates, either party to the
contract is required to make additional margin payments, known as variation
margin to cover any additional obligation it may have under the contract. In
addition, the Fund must deposit in a segregated account additional cash or
high quality securities to ensure the futures contract are unleveraged. The
value of assets held in the segregated account must be equal to the daily
market value of all outstanding futures contracts less any amounts deposited
as margin.
Swaps, Caps, Floors and Collars
The Global Income Fund may enter into interest rate, currency and index
swaps and purchase or sell related caps, floors and collars. The Fund expects
to enter into these transactions primarily to protect against currency
fluctuations, as a technique for managing the portfolio's duration (i.e., the
price sensitivity to changes in interest rates) or to protect against any
increase in the price of securities the Fund anticipates purchasing in the
future. The Fund intends to use these transactions as hedges, and neither will
sell interest rate caps or floors if it does not own the securities or other
instruments providing an income stream roughly equivalent to what the Fund may
be obligated to pay.
Interest rate swaps involve an agreement between the Global Income Fund and
another party to exchange their respective commitments to pay or receive
interest with respect to specified (notional) amount of principal (i.e. an
exchange of floating rate payments by one party for fixed rate payments by the
other. A currency swap is an agreement to exchange cash flows on a notional
amount based on changes in the values of the specified indices.
The purchase of an interest rate cap entitles the purchaser in exchange for
the premium paid to receive payments on a notional amount from the party
selling the cap to the extent that a specified index falls below a
predetermined interest rate or amount. A collar is a combination of a cap and
a floor that preserves a certain return within a predetermined range of
interest rates or values.
Restricted Securities
All of the Funds may also purchase securities that are not registered under
the Securities Act of 1933, as amended (the "1933 Act") ("restricted
securities"), including those that can be offered and sold to "qualified
institutional buyers" under Rule 144A under the 1933 Act ("Rule 144A
securities"). This investment practice could have the effect of increasing the
level of illiquidity in a Fund to the extent that qualified institutional
buyers become for a time uninterested in purchasing Rule 144A securities held
in the Fund's portfolio. Subject to a Fund's limitations on investments in
illiquid investments, a Fund may also invest in restricted securities that may
not be sold under Rule 144A, which presents certain risks. As a result,
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a Fund might not be able to sell these securities when the Adviser wishes to
do so, or might have to sell them at less than fair value. In addition, market
quotations are less readily available. Therefore, judgment may at times play a
greater role in valuing these securities than in the case of unrestricted
securities.
ADDITIONAL RISK FACTORS
The Global Income Fund may invest up to 25% of its total assets in high
yield or "junk bonds." High yield securities, although such securities may
offer higher yields than do higher rated securities, such low rated and
unrated securities and investments in emerging market debt securities
generally involve greater volatility of price and risk of principal and
income, including the possibility of default by, or bankruptcy of, the issuers
of the securities. The existence of limited markets for particular high yield
bonds or low rated securities may diminish a Fund's ability to sell the such
securities at fair value either to meet redemption requests or to respond to a
specific economic event such as a deterioration in creditworthiness of the
issuer. Reduced secondary market liquidity for certain low rated or unrated
debt securities may also make it more difficult for a Fund to obtain accurate
market quotations for the purpose of valuing the Fund's portfolio. Market
quotations are generally available on many low rated or unrated securities
only from a limited number of dealers and may not necessarily represent firm
bids of such dealers or prices for actual sales.
Adverse publicity and investor perceptions, whether or not based on
fundamental analysis, may decrease the values and liquidity of low rated
securities, especially in a thinly traded market. Analysis of the
creditworthiness of issuers of debt securities that are low rated securities
may be more complex than for issuers of higher rated securities, and the
ability of a Fund to achieve its investment objective may, to the extent of
investment in low rated securities, be more dependant upon such
creditworthiness analysis than would be the case if the Fund were investing in
higher rated securities.
Low rated securities may be more susceptible to real or perceived adverse
economic and competitive industry conditions than investment grade securities.
The prices of low rated securities have been found to be less sensitive to
interest rate changes than higher rated investments, but more sensitive to
adverse economic downturns or individual corporate developments. A projection
of an economic downturn or a period of rising interest rates, for example,
could cause a decline in low rated securities prices because the advent of a
recession could lessen the ability of a highly leveraged company to make
principal and interest payments on its debt securities. If the issuer of low
rated securities defaults, a Fund may incur additional expenses to seek
recovery. The low rated bond market is relatively new, and many of the
outstanding low rated bonds have not endured a major business recession. See
"DESCRIPTION OF INVESTMENT RATINGS" in the Statement of Additional
Information.
Certain Funds may invest in debt obligations issued or guaranteed by foreign
governments or their agencies, instrumentalities or political subdivisions, or
by supranational issuers (collectively, "sovereign debt"). Investing in
sovereign debt involves special risks. Certain foreign countries, particularly
developing countries, have experienced and may continue to experience, high
rates of inflations and high interest rates; exchange rate fluctuations; large
amounts of external debt, balance of payments and trade difficulties; and
extreme poverty and unemployment. The issuer of the debt or the governmental
authorities that control the repayment of the debt may be unwilling or unable
to repay principal or interest when due in accordance with the terms of such
debt, and the Funds may have limited legal recourse in the event of default.
The Global Income Fund's participation in the currency, option and futures
markets involves certain risks and transaction costs which are generally
greater for investments in emerging markets; because of the special risks
associated with investing in emerging markets and investment in debt
securities rated below investment grade, certain of the Global Income Fund's
investments should be considered speculative and the Global Income Fund is
designed for investors who wish to accept the risks entailed in such
investments which are different from those associated with a portfolio
consisting entirely of U.S. issuers denominated in U.S. dollars.
The Funds will usually effect currency exchange transactions on a spot
(i.e., cash) basis at the spot rate prevailing in the foreign exchange market.
However, some price spread on currency exchange (to cover service charges)
will be incurred when a Fund converts assets from one currency to another.
There are risks associated with the Fund being non-diversified.
Specifically, since a relatively high percentage of the assets of the Fund may
be invested in the obligations of a limited number of issuers, the value of
the shares of a non-diversified fund may be more susceptible to any single
economic, political or regulatory event than would the shares of a diversified
fund.
22
<PAGE>
PORTFOLIO TURNOVER
Portfolio turnover for each Fund may vary from year to year or within a year
depending upon economic, market and business conditions. The annual portfolio
turnover rates for the Funds in 1995 and 1994, respectively, were as follows:
276.56% and 113.36% for the Government Securities Fund, 57.62% (of which the
debt and equity portfolio turnover was 105.80% and 38.21%, respectively) and
37.53% (of which the debt and equity portfolio turnover was 19% and 43%,
respectively) for the Total Return Fund, 7.39% and 8.37% for the Tax-Exempt
Fund, and 37.59% and 46.17% for the Growth and Income Fund, and in 1995, 2.73%
for the Capital Appreciation Fund and 14.16% the Global Income Fund. A Fund
having a portfolio turnover rate of more than 100% may realize larger amounts
of gains or losses than it would with a lower portfolio turnover rate. If
there are gains, they are passed through to the shareholders as long-term
capital gain distributions and, as such, are taxable to the shareholders. See
"TAXATION OF SHAREHOLDERS" for further information. Also, a portfolio turnover
rate of greater than 100% may result in the Fund paying more brokerage
commissions or other transaction related costs. See "PORTFOLIO TRANSACTIONS
AND BROKERAGE ALLOCATIONS" in the Statement of Additional Information for
further information. Excessive short-term trading may result in excessive
"short-short income" under the Internal Revenue Code which, in turn, could
affect either Fund's status as a regulated investment company.
MANAGEMENT OF THE COMPANY
The Board of Directors of the Company is responsible for the administration
of the affairs of the Company pursuant to the applicable laws of the state of
Maryland. The Company, pursuant to Maryland's indemnification statute,
provides that neither its officers nor directors will be liable to the Company
or its shareholders for monetary damage for breach of fiduciary duty, except
for willful misfeasance, bad faith, gross negligence or reckless disregard of
duties in the conduct of his or her office.
Investment Manager. The Investment Manager with respect to each Fund is
Chubb Asset Managers, Inc., a wholly-owned subsidiary of The Chubb
Corporation. The Chubb Corporation, organized in 1967 as a New Jersey
corporation, is a holding company engaged through subsidiaries in the business
of property and casualty insurance on a worldwide basis, as well as life and
health insurance and real estate development. The Chubb Corporation traces its
history back to the formation of Chubb & Son in 1882 and the founding of its
principal property and casualty subsidiary, Federal Insurance Company, in
1901. Today, the Chubb Corporation, a Fortune 500 Company with assets
exceeding $20 billion, ranks among the nation's top 25 Stock/Insurance
companies by assets and offers insurance and financial planning tools to
clients around the world from 91 branch offices throughout North and South
America, Europe and the Pacific Rim.
The Investment Manager's principal place of business is 15 Mountain View
Road, Warren, New Jersey 07061. The Investment Manager is subject to the
overall authority of the Board of Directors of the Company, responsible for
the overall investment of each Fund's portfolio, consistent with each Fund's
investment objectives, policies and restrictions. The Investment Manager was
organized in August, 1986 as an investment adviser and is registered with the
Securities and Exchange Commission as such under the Investment Advisers Act
of 1940. The Investment Manager has served as the Company's investment manager
since December, 1987 and also serves as the sub-investment manager for the
Money Market Portfolio, the Bond Portfolio and the Growth and Income Portfolio
of Chubb America Fund, Inc., an open-end management investment company
organized in 1984. In addition, the principals of the Investment Manager, who
are also investment personnel of Chubb & Son, Inc., currently provide
investment advice to and supervision and monitoring of investment portfolios
for The Chubb Corporation and its affiliates, including general accounts of
the insurance affiliates of The Chubb Corporation totaling $16 billion, of
which $1.5 billion is invested internationally. In addition, certain
investment personnel employed by the Investment Manager currently provide
advice to other investment portfolios of entities not affiliated with The
Chubb Corporation or its affiliates in their capacity as officers or directors
of certain registered investment advisers not related to the Investment
Manager.
The following persons are primarily responsible for the day-to-day
management and implementation of Chubb Asset's process for the respective
Funds, (the inception date of each person's responsibility for a Fund and
their business experience for the past five years are indicated
parenthetically): Chubb Money Market Fund--Thomas J. Swartz, III, Vice-
President, (since June 1988/employed by Chubb Asset since 1988); Chubb
Government Securities Fund--Ned I. Gerstman, Senior Vice President; (since
December 1989/employed by Chubb Asset since before 1989) and Paul Geyer,
Assistant Portfolio Manager, Vice President (since 1992/employed by Chubb
Asset Managers since 1992); Chubb Total Return Fund and Chubb Growth and
Income Fund--David K. Schafer; Senior Vice President, (since March
1993/employed by Chubb Asset since March
23
<PAGE>
1993; President of Chubb Equity Managers, Inc. since September 1992; also
holds the following positions since before 1989--Director and President of
Schafer Value Fund, Inc.--Director, President and Treasurer of Schafer Capital
Management, Inc.--Chairman of the Board for Schafer Cullen Capital Management,
Inc.--and sole proprietor of Schafer Capital Management Co.), Chubb Total
Return Fund--Michael O'Reilly, President, (since December 1987/employed by
Chubb Asset since before 1989); Chubb Tax-Exempt Fund--Frederick W. Gaertner,
Senior Vice-President, (since December 1987/employed by Chubb Asset since
November 1989, formerly Vice-President, (since December 1987/employed by Chubb
Asset since November 1989, formerly Vice-President of Salomon Brothers, Inc.).
Chubb Capital Appreciation Fund, Robert Witkoff, Vice President of Chubb Asset
Managers, employed by Chubb Asset Managers since 1988. Chubb Global Income
Fund--Marjorie Raines, Senior Vice President/employed by Chubb Asset Managers
since before 1987, Roger Brookhouse, Senior Vice President, employed by Chubb
Asset Managers since 1995 and President and Chief Investment Officer, Chubb
Investment Services Limited, a subsidiary of Chubb Corporation, since 1993,
previously Managing Director of Credit Suisse Asset Mangement Ltd. London
1990, and Caroline Calbourne, Associate Portfolio Manager, employed by Chubb
Asset Managers since 1996, previously by Chubb Investment Services Ltd. 1994
and Hill Samuel Investment Management Gp. 1988.
Investment Administrator. The Investment Administrator with respect to each
Fund is Chubb Investment Advisory Corporation, a wholly-owned subsidiary of
Chubb Life. Its principal place of business is One Granite Place, Concord, New
Hampshire 03301. The Investment Administrator, in addition to providing
certain administrative services and facilities which are necessary for the
Company to conduct its business, will review the investment transactions as
executed by broker-dealers for each Fund to determine compliance with each
Fund's objectives, investment restrictions, and applicable laws and
regulations under the Investment Company Act of 1940. The Investment
Administrator also recommends and supervises the services of auditors,
counsel, and custodians, and maintains records not otherwise maintained by
other parties. The Investment Administrator also provides office space and
related utilities, including telephones, necessary for the Company's
operations; prepares and files tax returns and reports and filings which
pertain to Federal and state securities laws; schedules, plans the agenda for,
and conducts the meetings of the Company's Board of Directors; and provides
personnel, data processing services, and supplies requested by the Company.
The Investment Administrator was organized in 1984 as an investment adviser
and is registered with the Securities and Exchange Commission as such under
the Investment Advisers Act of 1940. In addition, the Investment Administrator
has acted as investment adviser for Chubb America Fund, Inc. since 1984, and
the Chubb Series Trust since 1995.
Transfer Agent. Shareholder services for the Company are provided by the
transfer agent, Firstar Trust Company, P.O. Box 701, Milwaukee, Wisconsin
53201-0701, or by overnight courier to Firstar Trust Company, 615 East
Michigan Street, Milwaukee, WI 53202-5207. Such services include, but are not
limited to, recording the issuance and redemption of shares of the Company,
crediting and paying dividends, and maintenance of shareholder records.
MANAGEMENT FEES AND EXPENSES
The investment management fees, which compensate both the Investment Manager
and the Investment Administrator, are paid monthly at an annual rate based on
a percentage of the average daily net asset value of each Fund, and are
computed at the annual percentage rates as shown in Table 1 below:
TABLE 1
<TABLE>
<CAPTION>
CHUBB GOVERNMENT SECURITIES,
TOTAL RETURN, TAX-EXEMPT,
GROWTH AND INCOME,
CHUBB MONEY CAPITAL APPRECIATION,
MARKET FUND AND GLOBAL INCOME FUNDS
------------------------ ----------------------------------
AVERAGE DAILY NET ASSET INVESTMENT INVESTMENT INVESTMENT INVESTMENT
VALUE ADMINISTRATOR MANAGER ADMINSTRATOR MANAGER
- ----------------------- ------------- ---------- --------------- --------------
<S> <C> <C> <C> <C>
1st $200 Million........ 0.35% 0.15% 0.45% 0.20%
Next $1.1 Billion....... 0.31% 0.14% 0.41% 0.19%
Over $1.3 Billion....... 0.27% 0.13% 0.37% 0.18%
</TABLE>
The Company is responsible for certain expenses relating to the Company's
operations which are not expressly assumed by the Investment Manager, the
Investment Administrator, or the Distributor, including: the fees of the
Investment Manager
24
<PAGE>
and Investment Administrator; taxes; legal, accounting, transfer agent,
custodian and auditing fees; portfolio valuation expenses; and preparing,
printing, and distributing Prospectuses, Statements of Additional Information,
and shareholder communications and reports, and other expenses. The Company's
expenses are deducted from total income before dividends are paid. Chubb Life
will bear certain expenses of the Company in excess of applicable limitations
under state securities laws. In addition, pursuant to an agreement dated as of
January 25, 1991 ("Expense Limitation Agreement") between the Company, the
Investment Manager, the Investment Administrator, the Distributor and Chubb
Life, the schedule of waivers and assumptions effective for 1995 included in
that agreement, the Investment Manager has waived and will continue to waive
in the current fiscal year its investment management fees. Pursuant to the
Expense Limitation Agreement the following fee waivers have been arranged: for
the fiscal year ended December 31, 1995, the Investment Administrator accepted
a reduced fee of 0.15% of the average daily net assets of the Money Market
Fund; a reduced fee of 0.25% of the average daily net assets of the Government
Securities Fund, the Total Return Fund, the Tax-Exempt Fund, the Growth and
Income Fund, and the Capital Appreciation Fund; and a reduced fee of 0.45% of
the average daily net assets of the Global Income Fund. For the fiscal year
ended December 31, 1996 the Investment Administrator will accept a reduced fee
of 0.15% of the average daily net assets of the Money Market Fund, a reduced
fee of 0.25% of the average daily net assets of the Government Securities
Fund, Tax-Exempt Fund, and Capital Appreciation Fund; a reduced fee of 0.35%
of the average daily net assets of the Total Return and the Growth and Income
Fund and a fee of 0.45% of the average daily net assets of the Global Income
Fund. Prior to January 1, 1994, the Distributor waived all of its fees under
the distribution plan adopted by the Company under Rule 12b-1 of the
Investment Company Act of 1940 ("Rule 12b-1 Plan"). For the fiscal year ended
December 31, 1994 and for the period from January 1, 1995 to August 31, 1995,
the Distributor waived any amount of its Rule 12b-1 Plan fees in excess of
0.20% of the average daily net asset value of the Total Return Fund, the
Growth and Income Fund, the Government Securities Fund and the Tax-Exempt Fund
and 0.15%, of the average daily net asset value of the Money Market Fund. For
the period September 1, 1995 through December 31, 1995, the Distributor agreed
and for the fiscal year ended December 31, 1996 has agreed to waive any amount
of its 12b-1 fees in excess 0.25% of the average daily net assets of the Total
Return Fund; Growth and Income Fund; Capital Appreciation Fund; and Global
Income Fund; 0.20% of the average daily net assets of the Government
Securities Fund and Tax-Exempt Fund; and 0.15% of the average daily net assets
of the Money Market Fund.
For the fiscal year ended December 31, 1995, pursuant to the Expense
Limitation Agreement, Chubb Life assumed a portion of certain additional
expenses of the Company. Due to the waivers and assumptions of expenses
described above, total expenses for the fiscal year ended December 31, 1995
were 0.50%, 1.00%, 1.08%, 1.00%, 1.08%, 1.25% and 1.75% of the average daily
net assets of the Money Market Fund, the Government Securities Fund, the Total
Return Fund, the Tax-Exempt Fund, the Growth and Income Fund, the Capital
Appreciation Fund and the Global Income Fund, respectively. Pursuant to the
Expense Limitation Agreement and the schedule of waivers and assumptions
effective for 1995, Chubb Life has agreed to assume all expenses for the year
beginning January 1, 1996 in excess of an annual rate of 1.75% of the average
daily net assets of the Global Income Fund; 1.25% of the average daily net
assets of the Total Return Fund, the Growth and Income Fund, and the Capital
Appreciation Fund; 1.00% of the average daily net assets of the Government
Securities Fund and the Tax Exempt Fund, and 0.50% of the average daily net
assets of the Money Market Fund. Chubb Life, in its discretion, may assume a
greater percentage of expenses of any Fund.
CAPITAL STOCK
The Company is composed of seven funds, six are open-end diversified
management investment companies and one is a non-diversified company. The
Company was incorporated in Maryland on April 27, 1987. The Company issues a
separate series of capital stock for each Fund. In the future, the Company may
establish additional funds. Each share of capital stock when issued will be
fully paid and non-assessable. Each share of capital stock issued with respect
to a Fund has a pro rata interest in the assets of that Fund and is entitled
to such dividends and distributions of income belonging to that Fund as are
declared by the Board of Directors. Each share of capital stock is entitled to
one vote on all matters submitted to a vote of all shareholders of the
Company, and fractional shares are entitled to a corresponding fractional
vote. Shares of a particular Fund will be voted separately from shares of the
other Funds on matters affecting only that Fund, including approval of the
investment management agreements and changes in the fundamental investment
objectives or restrictions of that Fund. The underlying assets of each Fund
are required to be segregated on the books of account, and are charged with
the liabilities of that particular Fund and a proportionate share of the
general liabilities of the Company based on the average net asset value of the
respective Funds for each quarter. Shareholders of the Company will not be
entitled to preemptive rights or cumulative voting rights. All shares may be
redeemed at any time by the Company.
25
<PAGE>
As a Maryland corporate entity, the Company is not required to hold regular
annual shareholder meetings and, in the normal course, does not expect to hold
such meetings. The Company is, however, required to hold shareholder meetings
for such purposes as, for example: (i) approving certain agreements as
required by the 1940 Act; (ii) changing fundamental investment objectives and
restrictions of the Funds; and (iii) filling vacancies on the Board of
Directors in the event that less than a majority of the directors were elected
by shareholders. The Company expects that there will be no meetings of
shareholders for the purpose of electing directors unless and until such time
as less than a majority of the directors holding office have been elected by
shareholders. At such time, the directors then in office will call a
shareholder meeting for the election of directors. In addition, holders of
record of not less than two-thirds of the outstanding shares of the Company
may remove a director from office by a vote cast in person or by proxy at a
shareholder meeting called for that purpose at the request of holders of 10%
or more of the outstanding shares of the Company. The Company has the
obligation to assist in such shareholder communications. Except as set forth
above, directors will continue in office and may appoint successor directors.
TAXES AND DIVIDENDS
Each Fund intends to continue to qualify as a "regulated investment company"
("RIC") under Subchapter M of the Internal Revenue Code of 1986 (the "Code").
It is each Fund's policy to comply with the provisions of the Code regarding
distribution of investment income of a RIC. Under these provisions, a Fund
will not be subject to federal income tax on that portion of its ordinary
income and net capital gains distributed to shareholders. Each Fund expects to
declare and distribute by the end of each calendar year all, or substantially
all, ordinary income and capital gain net income from the sale of its
investments. Failure to distribute substantially all ordinary income and
capital gain net income, may subject the Fund to an excise tax.
Dividends from ordinary income will be declared daily and distributed
monthly with respect to the Money Market Fund and the Government Securities
Fund, declared and distributed on a monthly basis with respect to the Tax-
Exempt Fund and the Global Income Fund, declared and distributed on a
quarterly basis with respect to the Total Return Fund, and declared and
distributed on an annual basis with respect to the Growth and Income Fund and
the Capital Appreciation Fund. Each Fund will distribute capital gain net
income, including net gains from foreign currency transactions if any, at
least annually. All dividends and capital gain distributions will be
automatically reinvested in additional shares of the Fund at the Fund's net
asset value at the close of business on the payment date of the dividend or
distribution unless the shareholder elects to receive all dividends and/or
distributions either in cash or to invest them, without the imposition of any
sales charge in any other Fund at such other Fund's net asset value at the
close of business on the payment date. Such notification must be received by
the Transfer Agent not less than 3 full business days prior to the record
date. If any dividend or distribution is returned to the Company because of
incomplete delivery, such amounts will be reinvested in additional shares of
the Fund with respect to which the dividend or distribution was made at the
Fund's net asset value next computed after receipt by the Transfer Agent.
TAXATION OF SHAREHOLDERS
Any dividends which a shareholder received from the Company, except for the
Tax-Exempt Fund, are considered ordinary income for Federal income tax
purposes, whether a shareholder elects to receive them in cash or additional
shares. Distributions of long-term capital gains are generally taxable to a
shareholder as such, regardless of how long the shareholder has held shares of
the Company. Corporate shareholders may be entitled to take a deduction for
ordinary income dividends received that are attributable to dividends received
from a domestic corporation, provided that both the corporate shareholder
retains its shares in the applicable Fund for more than 45 days and the Fund
retains its shares in the issuer from whom it received the income dividends
for more than 45 days.
It is expected that any dividends paid to shareholders from the Tax-Exempt
Fund will be exempt from Federal income tax to the extent such dividends are
derived from interest earned on municipal securities and constitute "tax-
exempt interest dividends". Distributions of income from investments in
taxable securities and of capital gains realized by the Tax-Exempt Fund would
be taxable to the shareholder. Income derived from certain non-essential
government issues of tax-exempt securities issued after August 7, 1986, which
securities the Tax-Exempt Fund may purchase from time to time, may subject
certain investors to the alternative minimum tax liability. In addition,
certain social security recipients that receive tax-exempt income may be
required to pay taxes on a portion of their social security benefits. The
Company will inform shareholders of
26
<PAGE>
the Tax-Exempt Fund of the character of their dividends and distributions at
the time they are paid, and will advise such shareholders of the tax status of
such distributions and dividends promptly after the close of each calendar
year. The Company anticipates that substantially all of the dividends paid by
the Tax-Exempt Fund will be exempt from Federal income taxes. Dividends and
distributions may be subject to state and local taxes.
Internal Revenue Service regulations require the Company or the securities
dealer effecting the transaction to file an informational return with the
Internal Revenue Service with respect to each sale of Company shares by an
investor. The Internal Revenue Code and the Department of Treasury regulations
thereunder, require the Company, or such broker implementing the transaction,
to withhold 31% of all dividends and redemptions for shareholders unless such
shareholders have provided a social security number or tax identification
number (or the shareholder has applied for such a number and is waiting for it
to be issued) and made the required certifications regarding the withholding
requirement indicated in the application to purchase shares of the Company.
PURCHASE OF SHARES
Shares of the Company are continuously offered by the Distributor and
through securities dealers which have executed a selected dealers agreement
with the Distributor. The Distributor, Chubb Securities Corporation, One
Granite Place, Concord, New Hampshire 03301, is a wholly-owned subsidiary of
Chubb Life and is the principal underwriter of the Company.
The minimum initial investment is $250 per Fund and subsequent investments
must be $50 or more per Fund. The minimum for both the initial and subsequent
investment may be waived when the shares are being purchased through plans
providing for regular periodic investments. The Company and the Distributor
reserve the right to refuse any order for the purchase of shares.
An investor may purchase shares in "street name" through a securities dealer
who has executed a selected dealers agreement with the Distributor. When
shares are purchased in "street name", the shares are held in the name of the
securities dealer for the benefit of the investor and usually are registered
in this manner for margin accounts or to facilitate transfers. However, the
Company will not permit investors to transfer these shares after purchase to
securities dealers who have not executed a selected dealers agreement with the
Distributor. In such a situation, the investor may either (1) ask the
investor's chosen securities dealer to execute a selected dealers agreement
with the Distributor, (2) leave the shares at the original securities dealer,
(3) transfer the shares into the investor's own name, or (4) redeem the
shares.
In order to transfer shares in "street name" between securities dealers who
have executed selected dealers agreements with the Distributor, the investor's
present securities dealer must make the transfer. The present securities
dealer should contact the Transfer Agent for the appropriate documentation. No
fee currently is charged by the Company or the Transfer Agent for this
service, although either the present or subsequent securities dealer may
charge a fee for making this transfer.
Shares are offered at the public offering price, which is the net asset
value per share of each Fund next computed after an order is physically
received in the offices of the Transfer Agent in good order and accepted by
the Transfer Agent from a shareholder's securities dealer, (or received and
accepted by the Transfer Agent when sent by mail from a shareholder directly),
plus a sales charge which is a variable percentage of the offering price
depending upon the amount of the sale, as shown in Table 2 for the Total
Return Fund, Growth and Income Fund and Capital Appreciation Fund, and Table 3
for the Government Securities Fund and Tax Exempt Fund and Global Income Fund.
However, no sales charge is applied for the purchase of shares of the Money
Market Fund, which are offered at the Fund's net asset value per share. Set
forth below are Table 2 for the Total Return Fund, Growth and Income Fund and
Capital Appreciation Fund, and Table 3 for the Government Securities Fund,
Tax-Exempt Fund and Global Income Fund. Each table indicates the total sales
charges or underwriting commissions and dealer concessions in connection with
the sale of shares of the respective Funds.
27
<PAGE>
TABLE 2
SALES CHARGES APPLICABLE TO TOTAL RETURN FUND, GROWTH AND INCOME FUND, AND
CAPITAL APPRECIATION FUND
<TABLE>
<CAPTION>
DEALER CONCESSION
AS PERCENTAGE OF AS A PERCENTAGE AS PERCENTAGE OF
SIZE OF TRANSACTION OFFERING PRICE OF NET ASSET VALUE OFFERING PRICE
------------------- ----------------- ------------------ ------------------
<S> <C> <C> <C>
Less than $100,000... 5.00% 5.26% 4.50%
$100,000 but less
than $250,000....... 4.00% 4.17% 3.50%
$250,000 but less
than $500,000....... 3.00% 3.09% 2.50%
$500,000 but less
than $1,000,000..... 2.00% 2.04% 1.75%
$1,000,000 but less
than $2,000,000..... 1.00% 1.01% 0.90%
$2,000,000 but less
than $5,000,000..... 0.50% 0.50% 0.45%
$5,000,000 and over.. 0.00% 0.00% 0.00%
TABLE 3
SALES CHARGES APPLICABLE TO GOVERNMENT SECURITIES FUND,
TAX-EXEMPT FUND, AND GLOBAL INCOME FUND
<CAPTION>
DEALER CONCESSION
AS PERCENTAGE OF AS PERCENTAGE OF AS PERCENTAGE OF
SIZE OF TRANSACTION PRICE OFFERING PRICE NET ASSET VALUE OFFERING PRICE
------------------------- ----------------- ------------------ ------------------
<S> <C> <C> <C>
Less than $100,000... 3.00% 3.09% 2.50%
$100,000 but less
than $250,000....... 2.50% 2.56% 2.00%
$250,000 but less
than $500,000....... 2.00% 2.04% 1.50%
$500,000 but less
than $1,000,000..... 1.50% 1.52% 1.00%
$1,000,000 but less
than $2,000,000..... 1.00% 1.01% 0.90%
$2,000,000 but less
than $5,000,000..... 0.50% 0.50% 0.45%
$5,000,000 and over.. 0.00% 0.00% 0.00%
</TABLE>
Because the Money Market Fund invests in instruments that normally require
immediate payment in federal funds (monies credited to a bank's account with a
Federal Reserve Bank), an order to purchase shares of the Money Market Fund
will not become effective until the next business day after receipt of the
investor's check. The Company reserves the right to delay the effectiveness of
an order to purchase shares of the Money Market Fund until the conversion into
federal funds has been verified.
The Distributor will, at its own expense, pay certain other amounts to the
selling securities dealer and will, from time to time, provide promotional
incentives to certain securities dealers whose representatives have sold or
are expected to sell significant amounts of the Company's shares. The
incentives shall include payment for travel expenses, including lodging at
luxury resorts, incurred in connection with trips taken by qualifying
registered representatives and members of their families to locations within
or outside of the United States. Dealers may not use sales of the Company's
shares to qualify for the incentives to the extent such may be prohibited by
the laws of any state or the rules of the NASD. From time to time the
Distributor may reallow to securities dealers the full amount of the sales
charge. The staff of the Securities and Exchange Commission is of the opinion
that dealers receiving 90% or more of the sales charge might be considered to
be underwriters under the Securities Act of 1933.
REDUCED SALES CHARGES
Sales charges may be reduced or may vary in amount for various classes of
investors. The circumstances in which sales charges will differ from those
listed in the table above are as follows:
1. Rights of Accumulation. The cost or current value (whichever is higher)
of an investor's existing shares of any Fund of the Company, with the
exception of the Money Market Fund, may be combined with the amount of the
current purchase in determining the sales charge to be paid.
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To ensure that the reduced sales charge will be applied, the investor or the
investor's dealer must indicate on the application that the purchase of shares
is to be accumulated with other shares held by the investor. Qualification for
the reduced sales charge is subject to the determination by the Company's
Transfer Agent, which will also determine the amount of the Company's shares
held by the investor that may be combined with the current purchases.
2. Letter of Intent. An investor may qualify for a reduced sales charge
immediately by signing a non-binding Letter of Intent in which the investor
states an intention to invest during the next 13 months a specified amount
which, if made at one time, would qualify the investor for a reduced sales
charge. The Letter of Intent may be signed at any time within 90 days after
the first investment which an investor wants included under the Letter of
Intent. If the investor purchases shares which are to be included under the
Letter of Intent before signing the Letter of Intent, the 13-month period
begins on the date of the purchase of shares to be included under the Letter
of Intent. After the Letter of Intent is signed, each additional investment in
any Fund, with the exception of Money Market Fund, will be entitled to the
sales charge applicable to the level of investment indicated in the Letter of
Intent. Such reductions, however, will be effective only after the investor or
the investor's dealer notifies the Transfer Agent that the investment
qualified for such a discount. An investor's ownership of shares in the
Company acquired more than 90 days before the Letter of Intent is signed will
be counted toward completion of the Letter of Intent, but will not be subject
to a retroactive downward adjustment of sales charge.
Any redemptions made by a shareholder during the 13-month period will be
subtracted from the amount of purchases for purposes of determining whether a
shareholder has fulfilled the terms of the Letter of Intent. The Letter of
Intent authorizes the Transfer Agent to escrow shares owned by the investor
having a purchase price of 5% of the dollar amount specified in the Letter of
Intent. If the terms of the Letter of Intent are not met, these escrowed
shares will be redeemed to make an upward adjustment of the sales charge that
results from a difference in the amount intended to be invested from the
amount actually invested. During the Letter of Intent period, the escrowed
shares will be held as part of the investor's account and will receive all
dividends and capital gain distributions.
To ensure that the reduced price will be received on future purchases, the
investor or the investor's securities dealer must inform the Transfer Agent
that this Letter of Intent is in effect each time shares are purchased.
3. Qualified Group Purchases. An individual who is a member of a qualified
group may also purchase shares of the Funds at the reduced sales charge
applicable to the qualified group as a whole. The sales charge is based upon
the aggregate dollar value of shares previously purchased and still owned by
the qualified group, plus the amount of the current purchase. For example, if
members of the qualified group had previously invested in the Total Return
Fund and still held $80,000 of such Fund's shares and now were investing
$25,000 in that same Fund, the sales charge would be 4.00%. Information
concerning the current sales charge applicable to a qualified group may be
obtained by contacting the Distributor.
A "qualified group" is one which (i) has more than 10 members, (ii) has been
in existence for more than six months, (iii) has a purpose other than
acquiring the Fund's shares at a discount and (iv) satisfies uniform criteria
which enable the Distributor to realize economies of scale in its costs of
distributing shares. A qualified group must (i) be available to arrange for
group meetings between representatives of the Company or the Distributor and
the members, (ii) must agree to include sales and other materials related to
the Company in its publications and mailings to members at reduced or no cost
to the Distributor, and (iii) seek to arrange for payroll deduction or other
bulk transmission of investments to the Company.
If a payroll deduction plan is offered by an employer of a qualified group
and if an investor selects such payroll deduction plan as a method of
investing in the Company, subsequent investments will be automatic and will
continue until such time as the investor notifies the Company and the
investor's employer to discontinue further investments. Due to the varying
procedures to prepare, process and forward the payroll deduction information
to the Company, there may be a delay between the time of the payroll deduction
and the time the money reaches the Company. The investment in a Fund will be
made at the offering price per share determined on the day that both the check
and payroll deduction data are received in proper form by the Company.
4. Purchases at Net Asset Value. Shares of the Funds may be purchased at net
asset value by (1) The Chubb Corporation, Chubb Life and their subsidiaries
and affiliate companies, (2) directors and present and retired officers and
full-time employees of the Company, the Investment Manager, the Investment
Administrator, the Distributor and affiliates of such companies and by their
close family members, (3) by registered representatives of broker-dealers
which have entered into a selected dealers agreement with the Distributor and
by their close family members. "Close family members" is defined as parents,
grandparents, siblings, spouse, children, and dependents. Such sales are made
upon the written assurance of the investor that the purchase not subject to a
sales charge is made for investment purposes and that the securities will not
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be transferred or resold except through redemption or repurchase by or on
behalf of the Company. All of the above-described investors must obtain a
special form from their employer or from the Distributor in order to qualify.
Shares of the Funds may also be purchased at net asset value by shareholders
where the amounts to be invested represent the redemption proceeds from
investment companies distributed by an entity other than the Distributor,
provided such redemption has occurred no more than 60 days prior to the
purchase of shares of any Fund and the shareholder paid an initial sales
charge and was not subject to a deferred sales charge on the redemption
proceeds. Please contact the Distributor to obtain a special form in order to
qualify.
Shares of the Funds may also be purchased at net asset value by accounts
which are a part of a program established by financial institutions, broker
dealers or registered investment advisers that charge an account management
fee or transaction fee, provided that such entity has specifically entered
into and maintains a current arrangement with the Distributor providing for
such program. Provided that sales made under this program are made upon the
written assurances that the shares so acquired will not be resold except to
the Funds.
Shares of the Funds also may be purchased at net asset value by employee
benefit plans qualified under Section 401 of the Code, including salary
reduction plans qualified under Section 401(k) of the Code, subject to minimum
requirements with respect to number of employees or amount of purchase, as may
be established from time to time by the Distributor. Currently those criteria
require that the employer establishing the plan have 100 or more employees or
that the amount currently invested in the Company or to be invested in the
Company during the subsequent 13-month period totals at least $1,000,000.
Employee benefit plans not qualified under Section 401 of the Code, such as
those established under Section 403(b) and 457 of the Code, may be afforded
the same privilege if they meet the above requirements as well as the uniform
criteria for qualified groups previously described under Group Purchases,
which may enable the Distributor to realize economies of scale in its sales
efforts and sales related expenses. If investments by employee benefit plans
at net asset value are made through a dealer who has executed a dealer
agreement with respect to the Company, the Distributor or one of its
affiliates may make a payment out of their own resources to such dealer in an
amount not to exceed 0.25% of the amount invested. Please contact the
Distributor for additional information.
DISTRIBUTION PLAN
The Company may pay directly for a portion of the distribution expense of
the Company pursuant to the Plan of Distribution pursuant to Rule 12b-1 (the
"Plan") under the Investment Company Act of 1940. Under the Plan, the Company
will pay the lesser of actual distribution expenses incurred under the Plan,
as determined by the Board of Directors of the Company, or 0.50% per annum of
the net asset value of each Fund or, with respect to the Money Market Fund,
0.25% per annum of the net asset value of such Fund. The Rule 12b-1 expense
will be accrued daily and paid quarterly in arrears. These Rule 12b-1 expenses
include (i) payments to the Distributor and to securities dealers and others
engaged in the sale of shares, (ii) payments of compensation to and expenses
of personnel who engage in or support distribution of shares or who render
shareholder support services not otherwise provided by the Company's Transfer
Agent, including responding to inquiries regarding the Company, (iii)
formulation and implementation of marketing and promotional activities, (iv)
preparation, printing and distribution of sales literature, prospectuses, and
statements of additional information for recipients other than existing
shareholders, and (v) obtaining such information, analyses and reports with
respect to marketing and promotional activities as the Company may, from time
to time, deem advisable.
The Board of Directors has determined that the maximum amount payable under
the Plan should be allocated so that (1) 0.25% per annum of the net assets of
each Fund or, with respect to the Money Market Fund, 0.075% per annum of the
net assets of such Fund will be used to finance sales or promotional
activities and will be considered to be an asset-based sales charge and (2)
0.25% per annum of the net assets of each Fund or, with respect to the Money
Market Fund, 0.175% per annum of the net assets of such Fund will be paid to
securities dealers and others as a service fee. No payment of service fees
under the Plan will be made to a securities dealer unless that dealer has sold
shares of the Company, exclusive of the Money Market Fund, that are
outstanding for a minimum of 12 months and that are valued in excess of
$1,000,000 or, with respect to the Money Market Fund, has sold shares of the
Company valued in excess of $1,000,000.
For the fiscal year ended December 31, 1995, the Company paid $186,402 in
Rule 12b-1 expenses under the terms of the Plan. The Distributor will waive
payment of distribution fees for the current fiscal year in excess of 0.25% of
the average
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daily net assets of the Total Return Fund, the Growth and Income Fund, the
Capital Appreciation Fund, and Global Income Fund; and 0.20% of the average
daily net assets of the Government Securities Fund and the Tax-Exempt Fund,
and 0.15% of the average daily net assets of the Money Market Fund.
As required under Rule 12b-1, the Plan was approved by the Company's Board
of Directors, including a majority of the directors who are not interested
persons of the Company and who have no direct or indirect financial interest
in the operation of the Plan or any agreement relating thereto, and by the
shareholders of the respective Funds. The Board of Directors has determined
that there is a reasonable likelihood that the Plan will benefit each Fund and
the shareholders of each Fund, although it is possible that the Rule 12b-1
expenses paid by one Fund may, to a certain extent, benefit another Fund.
DETERMINATION OF NET ASSET VALUE
Net asset value per share of each Fund normally will be determined
separately as of the close of regular trading on the New York Stock Exchange
(presently 4:00 P.M. New York time) on each day during which the New York
Stock Exchange is open for trading.
Net asset value per share of each Fund is calculated by dividing the value
of all of the Fund's portfolio securities plus the value of its other assets
(including dividends and interest received or accrued), less all liabilities
(including accrued expenses and dividends payable), by the number of
outstanding shares of the Fund. For purposes of determining the value of a
Fund's portfolio securities, cash and receivables will be valued at their face
amounts. Interest will be recorded as accrued and dividends will be recorded
on the ex-dividend date. Foreign securities are valued as of the close of
trading on the foreign exchanges on which they are traded or as of the close
of regular trading on the New York Stock Exchange if that is earlier.
The Money Market Fund's price per share will be determined in accordance
with the amortized cost valuation method. For all the other Funds, short-term
debt instruments with a remaining maturity of 60 days or less are also valued
on an amortized cost basis, unless the Board of Directors determines that such
method does not represent fair value. Options and convertible preferred stocks
listed on a national securities exchange are valued as of their last sale
price or, if there is no sale, at the current bid price. Futures contracts are
valued as of their last sale price or, if there is no sale, at the latest
available bid price.
All other securities and assets are valued at their market value. Securities
which are traded on a recognized domestic exchange are valued at the last sale
price on the exchange on which such securities are principally traded.
Securities which are primarily traded on foreign exchanges are generally
valued at the preceding closing values of such securities on their respective
exchanges. If market prices are not readily available, then such securities
are valued at fair value as determined in good faith by the Company's Board of
Directors. With the approval of the Board of Directors, the Company may
utilize a pricing service, a bank, or a broker-dealer experienced in such
matters to perform any of the above-described valuation functions.
REDEMPTION OR REPURCHASE
1. Written Requests
A shareholder may sell all or a portion of his/her shares (known as a
liquidation or redemption) by forwarding a written request to the Company's
Transfer Agent, Firstar Trust Company, Mutual Fund Services, Third Floor, P.O.
Box 701, Milwaukee, WI 53201-0701 or by overnight courier to (Fund Name)
Firstar Trust Company, 615 East Michigan Street, Milwaukee, WI 53202-5207. The
shareholder will receive from the Company on his/her redeemed shares the net
asset value per share next determined after the written request, in proper
form, is received by the Transfer Agent. In order to be in proper form, a
written request must be accompanied by stock certificates, if any, which have
been issued to a shareholder, properly endorsed and in good order for
transfer, including information regarding the account number and number of
shares. Payment upon redemption will usually be made in cash, although the
Company may, under certain limited circumstances, make redemptions-in-kind.
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For a shareholder's protection, in order for a written request to be
considered to be in proper form, his/her signature must be guaranteed (or, if
there is more than one holder of record, such request must be signed by all
shareholders of record exactly as registered and all signatures must be
guaranteed) if the redemption request involves any of the following:
(1) the proceeds of the redemption are over $50,000;
(2) the proceeds (in any amount) are to be paid to someone other than the
registered owner(s) of the account or a person or entity designated on the
account application; or
(3) the proceeds (in any amount) are to be sent to other than the
shareholder's address of record or the address of another person or entity
designated on the account application; or
(4) share certificates (in any amount).
A notarized signature will not be sufficient for the request to be in proper
form. Signatures must be guaranteed by an "eligible guarantor institution" as
defined in Rule 17Ad-15 under the Securities Exchange Act of 1934. Eligible
guarantor institutions include banks, brokers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations. A complete definition of eligible guarantor
institutions is available from the Company's Transfer Agent. Broker-dealers
guaranteeing signatures must be a member of a clearing corporation or maintain
net capital of at least $100,000. Credit unions must be authorized to issue
signature guarantees. Signature guarantees will be accepted from any eligible
guarantor institution which participates in a signature guarantee program.
Liquidation requests for corporate, partnership, trust and custodianship
accounts may require special documentation to be considered in proper form.
Retirement account liquidations also require the completion of certain
additional forms to ensure compliance with Internal Revenue Service
regulations and to be considered in proper form. If you have any questions
regarding a proposed liquidation which fall into these categories, please
contact the Company's Transfer Agent, at P.O. Box 701, Milwaukee WI 53201-
0701.
The Company also will accept repurchase orders by telephone from securities
dealers who have signed a selected dealers agreement with the Distributor to
purchase shares of the Company. The only difference between a normal
redemption request in writing and a repurchase order is that if a shareholder
chooses to transact through a securities dealer, an investor's shares will be
redeemed at their net asset value next determined after the Transfer Agent
receives the repurchase order from the shareholder's dealer, rather than after
receipt by the Transfer Agent of the written request in proper form. The 7-day
period within which the proceeds of the redemption or the repurchase will be
sent to the shareholder begins when the Transfer Agent receives a written
request in proper form. Also, a securities dealer may charge the shareholder a
fee for handling the order.
2. Telephone Requests
Shareholders of any of the Funds may redeem or exchange shares by telephone
authorization, provided that either (i) the shareholder has selected the
privilege on the application or, subsequently, by a written authorization
provided to the Transfer Agent or (ii) if the shareholder does not designate
whether he or she has accepted or declined the privilege for telephone
exchanges on the application, the shareholder will receive the privilege for
telephone exchanges automatically. Redemptions which require signature
guarantees may not be made by telephone. (See "Written Requests" above.) The
Transfer Agent will employ procedures that it and the Company believes are
reasonable in order to confirm that instructions communicated by telephone are
genuine. These procedures include (i) any shareholder or registered
representative of record providing instructions by telephone to redeem or
exchange shares must be on a recorded telephone line, (ii) all such
shareholders or registered representative of record must supply the Transfer
Agent with personal identification information at the time of redemption or
exchange for verification purposes, and (iii) all transactions relying on
telephone instructions will be verified by a written confirmation statement
sent by the Transfer Agent. If these "reasonable procedures" or other
procedures that may be developed are not employed in order to confirm that
instructions communicated by telephone are genuine, the Company may be liable
for any losses due to unauthorized or fraudulent instructions. The Transfer
Agent has agreed to indemnify the Company from any losses arising from an act
on its part or a failure or omission to act by it that was negligent or in bad
faith or constituted willful misconduct or was in reckless disregard in the
performance of its duties under the Transfer Agency Agreement. Currently, no
fee is charged for this telephone exchange privilege, although shareholders
who elect to use a wire transfer to effect payment directly to their bank
account will be charged a fee, currently $7.50 to cover the cost of this
transfer. The Transfer Agent's shareholder services telephone lines are open
from 9 a.m. to 6 p.m. E.T. on each day during which the New York Stock
Exchange is open for trading. Telephone redemption requests made in good order
after the close of regular trading on the New York Stock Exchange, currently 4
p.m. New York Time, will be executed at the Fund's net asset value next
determined after the order is accepted.
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Neither the Company nor the Transfer Agent will be liable to the shareholder
or any third party if the shareholder is unable to reach the Transfer Agent by
telephone. The shareholder may be unable to implement a telephone redemption
during periods of drastic economic or market change.
This telephone redemption privilege may be terminated or modified upon 60
days written notice to the shareholders.
3. Other Matters
Normally, payment for redeemed shares will be sent to shareholders within 7
days after receipt of the redemption request by telephone or in proper written
form. There may be up to a 15-day delay in mailing out the redemption proceeds
check for shares purchased by check if the check which the Company received
when a shareholder purchased such shares has not yet cleared or if exchange of
address has occurred without a signature guarantee although the shares
redeemed will be priced for redemption upon receipt of the redemption request.
A shareholder can avoid the inconvenience of this check clearing period by
purchasing shares with federal funds or bank wire.
A shareholder who has held shares for at least 6 months and who has redeemed
shares or has had shares repurchased, has a right to reinvest in any of the
Funds at the then net asset value of the Funds without the payment of a sales
charge, except that a shareholder of the Money Market Fund will be required to
pay the applicable increased sales charge. Such reinvestment must be made
within 90 days of the redemption or repurchase, and is limited to no more than
the amount of the redemption or repurchase proceeds. Currently, there is no
charge by the Company with respect to repurchases; however, the Company
reserves the right to charge a fee for this service and to otherwise modify or
terminate this privilege. Redemption or repurchase of shares is a taxable
event and gain or loss normally must be recognized. Reinvestment within a 30-
day period in the same Fund is considered a "wash sale" and results in non-
allowance of any loss for Federal income tax purposes.
The Company reserves the right to liquidate the account of any shareholder
whenever the value of the shareholder's account in any of the Funds falls
below $250 as a result of redemptions. Before the Company liquidates a
shareholder's account, it will give the shareholder 60 days written notice of
the proposed liquidation during which time the shareholder may increase the
value of the account and avoid liquidation.
SHAREHOLDER SERVICES
The Company offers a variety of programs to facilitate the purchase of
shares on a regular basis and to make periodic withdrawals.
Automatic Investment Program
Under this plan, on any business day chosen, a shareholder can make
additional monthly investments automatically in one or more of the Funds by
having pre-authorized checks or electronic drafts drawn on the shareholder's
checking account. Currently, the minimum for these monthly investments is $50
per check or electronic draft. Participation in this plan is voluntary and may
be discontinued by the shareholder without penalty with 3 days notice prior to
the next scheduled purchase to the Transfer Agent. To qualify for a reduced
sales charge, the investor must use the Automatic Investment Program in
combination with the Letter of Intent.
Systematic Withdrawal Plan
Shareholders with an account valued at not less than $5,000 may enter into a
Systematic Withdrawal Plan which provides for payments of a specified dollar
amount or percentage of a shareholder's account value to be made on a monthly,
quarterly, semi-annual or annual basis, payable as requested by the
shareholder in writing; if the payment will be to a party other than the
registered owner or a person designated on the account application, the
written request must be in proper form and the signature must be guaranteed.
No charge is currently assessed against the account, but a charge could be
instituted on 60 days written notice to the shareholders in the event that the
Company ceases to assume the costs of these services.
The minimum amount which may be withdrawn each period is $50. (This is
merely the minimum amount allowed and should not be construed as a recommended
amount.) The maintenance of a Systematic Withdrawal Plan concurrently with
purchases of additional shares of the particular Fund involved may not be
advantageous because of the sales commission involved in the additional
purchases.
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Exchange Privilege
Shareholders of any of the Funds may exchange shares, by telephone, in
writing or through securities dealers, for shares of any of the other Funds. A
sales charge will be assessed to those shareholders who exchange shares of the
Money Market Fund, Government Securities Fund and Tax-Exempt Fund (to the
extent necessary to make up any difference in sales charge) for shares of the
other Funds. No sales charge will be imposed on exchanges between any of the
other Funds. Each exchange order must be in proper form and currently, there
is no charge for this service. This exchange privilege is subject to
termination and its terms are subject to change. For federal income tax
purposes, any such exchange constitutes a sale upon which a gain or loss may
be realized, depending upon whether the value of the shares being exchanged is
more or less than the shareholder's adjusted cost basis.
Any shareholder exchanging shares by telephone must supply the Transfer
Agent with personal identification information at the time of the exchange for
verification purposes. Procedures have been established to reduce the risk of
unauthorized telephone exchanges including refusal of a telephone redemption;
however, some risk still exists and a shareholder assumes such risk when
exchanging shares by telephone.
Systematic Exchange Privilege
Shareholders with an account valued at not less than $5,000 may enter into a
Systematic Exchange Privilege which provides for the monthly exchange of a
specified dollar amount or percentage of such shares for shares of any of the
other Funds. Exchanges are subject to the terms and conditions described under
"Exchange Privilege" above. The minimum amount which may be exchanged each
month is $50. Fund shares may not be held in certificated form to use this
privilege.
Checkwriting Privilege
Shareholders in the Money Market Fund, the Government Securities Fund, the
Tax-Exempt Fund and the Global Income Fund only may redeem their shares by
availing themselves of the Checkwriting Privilege service offered by the
Company. Shareholders in any of these three Funds whose accounts have a total
value of not less than $250 in one of these Funds may draw on that account
through the use of checks which will be issued to shareholders. Any check so
drawn may not be less than $250 per check. There may be up to a 15-day waiting
period before a shareholder can draw on the account if the check which the
Company received when a shareholder purchased the shares has not yet cleared.
Currently, there is no service charge for maintenance of this program;
however, this checkwriting privilege is subject to termination and its terms
are subject to change. For federal income tax purposes redemptions made
through the Checkwriting Privilege constitute sales upon which a gain or loss
may be realized.
Individual Retirement Account
The Company has an Individual Retirement Account ("IRA") prototype available
for shareholders who wish to purchase shares of the Funds to fund an IRA. For
further information about this service, please contact the Distributor at the
address or phone number shown on the cover page of this Prospectus.
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[ART] CHUBB INVESTMENT FUNDS INVESTING ACCOUNT
APPLICATION
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ACCOUNT PROVISIONS
1. CHUBB INVESTMENT FUNDS ACCOUNT MAY BE OPENED by completing this application
and forwarding it through an authorized investment dealer to Firstar Trust
Company, Inc. or any successor transfer agent, referred to below as the
"Transfer Agent." The Application becomes effective only upon its acceptance
by the Transfer Agent and is to be construed under the laws of Maryland.
Acceptance of this Application by the Transfer Agent does not create an option
warrant or right to purchase shares of the Fund and no penalty is incurred by
any party if the intention declared is not fulfilled.
2. CERTIFICATES will not be issued unless requested, but shares included under
these Accounts will be placed to the credit of the investor on the records
books of Chubb Investment Funds, Inc. and shall entitle him/her to full
shareholder rights. At written request of the investor, certificates will be
issued for all or part of the full shares owned without in any way affecting
the continued operation of the Investor's Chubb Investment Funds, except that
no certificate will be issued to a shareholder whose account has a net asset
value of less than $250.
3. SYSTEMATIC WITHDRAWAL PLAN AND SYSTEMATIC EXCHANGE PRIVILEGE PAYMENTS shall
be made from the proceeds of redeemed shares of the Fund. The Transfer Agent,
as Agent for the Investor, will redeem as many shares as shall be necessary to
obtain the funds needed for the scheduled payment. Such redemption of shares
shall be made at the net asset value in effect at the close of business on the
10th or 25th day as designated by the investor (or, if that day is not a
business day, then the following business day) of each month. Periodic checks
of $50 or more will be sent per the Investor's instructions either monthly,
quarterly, semi-annually or annually (monthly only for the Systematic Exchange
Privilege) on or before the fifth business day following such redemption.
Investors should be cautioned that purchases of shares of the Fund at a time
when the Investor has a Systematic Withdrawal Plan in effect would result in
the payment of unnecessary commissions by the Investor and may not be
advantageous to him/her.
4. SHARES MAY BE REDEEMED at any time upon written or telephone request of the
Investor or the registered representative of record OR upon 60 days' notice to
a shareholder whose account has a net asset value of less than $250 as a
result of redemption, provided such shareholder does not increase his/her
record ownership to the minimum level within 60 days after the notice is
mailed.
5. A DISTRIBUTION OPTION MAY BE CHANGED at any time with written notice or
telephone request from an investor or registered representative of record to
the Transfer Agent. Upon receipt by the Transfer Agent of Appropriate evidence
of the Investor(s) death(s), the Distribution Option will automatically be
changed so that dividends are paid in cash and capital gain distributions are
reinvested in additional shares in the Investor(s) account.
6. A CHUBB INVESTMENT FUNDS ACCOUNT WILL BE CLOSED when all shares in the
Account are redeemed or transferred. Upon closing of an Account or termination
of a Withdrawal Plan or Systematic Exchange Privilege, unless otherwise
requested, fractional shares will automatically be redeemed at the net asset
value effective at the time of such closing or termination, and will be
delivered to the Investor or his/her duly appointed legal representative,
together with any cash balance then held.
7. The Transfer Agent will act as Agent for the Dealer in purchasing shares
from the Principal Underwriter, as Agent for the Principal Underwriter in
purchasing shares from the Fund and as Agent for the Fund in repurchasing
shares in certain accounts. In acting as Agent for the Dealer, the Transfer
Agent shall incur no liability for any action taken or omitted in good faith
and with due care. The Fund bears the cost of the services which the Transfer
Agent renders to the Investor, and the cost of services which the Transfer
Agent renders to the Dealer is borne by the Principal Underwriter. The
Transfer Agent may charge the Investor for extra services performed at his/her
request, as set forth in the Prospectus.
8. PAYEES EXEMPT FROM BACKUP WITHHOLDING. Payees specifically exempted from
backup withholding on interest and dividend payments include the following:
. A corporation
. A financial institution
. An organization exempt from tax under section 501(a), or an individual
retirement plan
. The United States or any agency or instrumentality thereof
. A State, the District of Columbia, a possession of the United States, or
any subdivision or instrumentality thereof
. A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof
. An international organization or any agency or instrumentality thereof
. A registered dealer in securities or commodities in the U.S. or a
possession of the U.S.
. A real estate investment trust
. A common trust fund operated by a bank under section 584(a)
. An exempt charitable remainder trust, or a non-exempt trust described in
section 4947(a)(1)
. An entity registered at all times under the Investment Company Act of
1940
. A foreign central bank of issue
. A middleman known in the investment community as a nominee or listed in
the most recent publication of the American Society of Corporate
Secretaries, Inc., Nominee List.
<PAGE>
INDIVIDUAL ACCOUNT APPLICATION--(NOT TO BE USED AS AN IRA)
- -------------------------------------------------------------------------------
DEALER AGREEMENT
The Dealer guarantees the signature(s) of the applicant(s); that to the best
of the Dealer's knowledge and belief the Investor is of full age and is
legally competent; that the Dealer may lawfully sell securities in the state
which the Investor has designated in such application as his/her mailing
address; and that in the case of a Systematic Withdrawal Plan, that the Dealer
has reviewed with the applicant(s) the provisions of this Systematic
Withdrawal Plan and the rate of withdrawal, and believes that the withdrawals
requested are reasonable in light of the Investor's circumstances. The Dealer
represents that it has entered into a Selected Dealer Agreement with Chubb
Securities Corporation, the Principal Underwriter, and in signing this
Application appoints the Transfer Agent, Inc. as its Agent to execute the
purchase transactions in accordance with the terms and the Company Account
Application executed by the Investor or the Investor's Withdrawal Plan or
Systematic Exchange Privilege and to confirm each purchase to the Investor and
Dealer. With respect to each purchase, the Transfer Agent will remit semi-
monthly to the Dealer the Amount of its concession.
TERMS OF ESCROW
1. From my initial purchase (or from subsequent purchases, if necessary), 5%
for the Total Return and Growth and Income Funds and 3% of the Government
Securities and Total Return Funds, of the minimum dollar amount in the
category specified in my Letter of Intent will be held in escrow by the
Transfer Agent under this Letter of Intent in the form of shares, registered
in my name computed to the nearest full share at the public offering price
applicable to the Initial purchase.
2. All dividends and any capital gains distributions on shares held in escrow
will be paid to me or my order.
3. When I complete the minimum investment in the category specified in my
Letter of Intent, the shares held in Escrow will remain on deposit unless I
instruct that a certificate be delivered to me.
4. If my total purchases within 13 months under this Letter of Intent plus my
credit under the "Right of Accumulation" are less than the amount I have
specified, I will remit to Chubb Investment Funds, Inc. any difference between
the sales charge on the amount actually purchased and the amount specified in
this Letter of Intent.
5. If I do not pay such difference in sales charge within 20 days after
written request from Chubb Investment Funds, Inc. or my Dealer, the Transfer
Agent, upon instructions from Chubb Investment Funds, Inc. will redeem the
appropriate number of shared held in Escrow to realize such difference and
release any excess.
6. In signing this Agreement, I hereby irrevocably constitute and appoint the
Transfer Agent my attorney to surrender for redemption any or all shares held
in Escrow with full power of substitution in the premises.
LETTER OF INTENT TERMS
1. If my total purchases made under this Letter of Intent plus my credit under
the "Right of Accumulation" are large enough to qualify for a lower sales
charge category than that application to the category I have specified, all
transactions will be recomputed on the expiration date of the Agreement to
effect the lower sales charge. The Dealer, by signing this Letter, agrees to
return to Chubb Investment Funds, Inc. as part of such retroactive price
adjustment the excess of the commission previously allowed or paid to the
Dealer over that which is applicable to the actual amount of the total
purchases under this Letter of Intent plus my credit under the "Right of
Accumulation."
2. In retroactive price adjustment, any difference in sales charge will be
either delivered to me in cash or invested in additional shares at the lower
charge, as I so instruct.
3. In order to qualify for the quantity discount under this Agreement, members
of my immediate family include my spouse, children under 21, or any legal
representative of my minor children. Also qualifying for the quantity discount
are purchases made by a trustee or other fiduciary of a single trust estate or
single fiduciary account, including a pension, profit-sharing, or other
employee benefit trusts created pursuant to a plan qualified under Sec. 401 or
406 of the Internal Revenue Code.
4. A purchase not made pursuant to this Agreement may be included hereunder if
this Agreement is filed within 90 days of the purchase, in which event the 13-
month period will commence on the date of such purchase.
5. Subject to the above terms of Escrow, each purchase will be made at the
current public offering price applicable for the full amount covered by the
Letter of Intent, as described in the Prospectus of the Fund.
6. To ensure that future purchases will receive a quantity discount, I or my
Dealer must inform the Transfer Agent that this statement is in effect each
time I make an investment in shares. Whenever I make an additional investment
in shares of the Fund, I will make reference to this Letter of Intent when
each remittance is forwarded for investment.
TELEPHONE EXCHANGE AND REDEMPTION AUTHORIZATION
1. I understand that all the restrictions which apply to exchanges and
redemptions of shares, as outlined in the current Prospectus, apply to
telephone exchanges and redemptions, including service charges and any sales
charges.
2. I understand and agree to notify the Transfer Agent, in writing, or any
changes which would affect this authorization, including cancellation. I
further understand that those changes will become effective within 3 days
after receipt of the written notification.
3. I understand that the Transfer Agent will require, as verification,
personal identification information each time I exchange or redeem shares by
telephone. By signing this application, I further understand that although
these procedures have been established to reduce the risk of unauthorized
exchanges and redemptions, such a risk still exists, and I understand and
agree that neither Chubb Investment Funds nor the Transfer Agent is liable for
any loss arising from any telephone exchange or redemption.
<PAGE>
NEW ACCOUNT
[ART] CHUBB INVESTMENT FUNDS APPLICATION
- -------------------------------------------------------------------------------
Make check payable to and mail with the application to:
Chubb Investment Funds
Mutual Funds Service Center
P.O. Box 701
Milwaukee, WI 53201-0701
- -------------------------------------------------------------------------------
YOUR ACCOUNT REGISTRATION (PLEASE PRINT)
- ----------------------------
Individual or Joint Tenant --------------------------------------
- ---------------------------- Existing Account No., If Any
-------------------------------------
- -------------------------------------- Gifts to Minors
First Name Initial Last -------------------------------------
- -------------------------------------- --------------------------------------
Social Security Number DOB Custodian's Name (only one can be
named)
- --------------------------------------
Joint Tenant Initial Last --------------------------------------
Minor's Name (only one)
- --------------------------------------
Social Security Number DOB --------------------------------------
- -------------------------------------- Social Security Number of Minor
Your Mailing Address under the __________ [_] UGMA [_] UTMA
- -------------------------------------- State of Residence
--------------------------------------
- -------------------------------------- Corporation, Trust, or other Entity,
Street (S)401 Tax-Qualified Plan
--------------------------------------
- --------------------------------------
City State Zip Code --------------------------------------
Name of Corporation, Trust or 401
( ) Plan
- --------------------------------------
Daytime Phone --------------------------------------
Tax ID Number
--------------------------------------
Name of Trustees (Corporate Officer)
- -------------------------------------------------------------------------------
DISTRIBUTION OPTIONS If none of the TELEPHONE EXCHANGE I authorize
options below are elected, all exchanges between Chubb Investment
distributions will be reinvested. Funds upon telephone instruction by
[_] Dividends and capital gains in the shareholder or the registered
additional shares representative of record for the
[_] Dividends in cash; capital gains account. [_] Yes [_] No
in additional shares
[_] Dividends and capital gains in If neither box is checked, the
cash telephone exchange privilege will be
[_] Automatic Dividend provided. Call 800-541-2053
Diversification (ADD).
Reinvest my dividends and capital
gains from ________________________
portfolio into __________ portfolio
- -------------------------------------------------------------------------------
PORTFOLIO ALLOCATION (Minimum $250
per portfolio)
Chubb Money Market $______ Chubb Growth & Income $______
Chubb Government $______ Chubb Capital Appreciation $______
Chubb Tax Exempt $______ Chubb Global Income $______
Chubb Total Return $______ Total Amount Invested $______
- -------------------------------------------------------------------------------
EXPEDITED TELEPHONE REDEMPTIONS (FOR FEDERAL FUND WIRES ONLY)
[_] You may redeem your shares of any --------------------------------------
portfolio by calling 800-541-2053. Name of Bank Account
Shares will be redeemed and check
made payable as account is registered --------------------------------------
and mailed to address or wired to the Bank Account Number
bank account. Maximum telephone
redemption is $50,000 per --------------------------------------
transaction. Telephone redemption Name of Bank
cannot be done within 15 days of an
address change over the phone. --------------------------------------
Address
IMPORTANT: IF YOU WISH TO HAVE
FEDERAL FUND WIRE SERVICE, ENCLOSE A
VOIDED CHECK FROM THE BANK ACCOUNT IN
WHICH YOU WISH TO USE THIS SERVICE, A
CHARGE MAYBE IMPOSED FOR WIRE
TRANSFER.
<PAGE>
CIF NEW ACCOUNT APPLICATION (CONTINUED)
- -------------------------------------------------------------------------------
AUTOMATIC INVESTMENT PLAN ($50 minimum initial investment each portfolio)
[_] Beginning on_____ of_____, and
every month --------------------------------------
Month Year Bank Name
thereafter, I authorize FIRSTAR Trust
Company to debit, on or about the [_] --------------------------------------
th of each month or the next business Portfolio Account Number Portfolio
day thereafter, the amount requested (if assigned) Name
from my bank account for investment
in the portfolio indicated. --------------------------------------
Amount of Each Monthly Investment
($50 minimum per fund)
PLEASE ATTACH A VOIDED CHECK. YOUR
BANK MUST BE A MEMBER OF THE --------------------------------------
AUTOMATED CLEARING HOUSE (ACH). Depositor's Signature
--------------------------------------
Depositor's Signature (if joint bank
account, both must sign)
- -------------------------------------------------------------------------------
CHECK-WRITING OPTION (Money Market, Government and Tax Exempt)
[_] I have enclosed a signed check writing signature form from the prospectus.
- -------------------------------------------------------------------------------
LETTER OF INTENT (OPTIONAL), [_] $100,000 [_] $250,000 [_] $500,000
[_] $1,000,000 [_] $2,000,000 [_] $5,000,000
I agree to the Letter of Intent
Conditions as outlined in the RIGHT OF ACCUMULATION
prospectus. I intend to invest, [_] I own shares in the portfolios
within a 13-month period beginning on noted, to be applied for a reduced
the date hereof (initial purchase sales charge.
date) in shares of the Fund purchased
hereunder and one or more of the --------------------------------------
other funds listed above (the Portfolio Account Number
"Funds"), an aggregate amount which,
together with the value of shares of --------------------------------------
any of the Funds, then owned by me, Portfolio Account Number
will equal or exceed the amount
indicated as follows:
- -------------------------------------------------------------------------------
SYSTEMATIC EXCHANGE Exchange to: Monthly Dollar Amount
Chubb Money Market $______
Exchange from (check one): Chubb Tax Exempt $______
[_] Chubb Money Market Chubb Growth & Income $______
[_] Chubb Government Chubb Government $______
[_] Chubb Tax Exempt Chubb Total Return $______
[_] Chubb Total Return Chubb Global Income $______
[_] Chubb Growth & Income Chubb Capital Appreciation $______
[_] Chubb Capital Appreciation
[_] Chubb Global Income
($50 minimum per portfolio selected)
- -------------------------------------------------------------------------------
SYSTEMATIC WITHDRAWAL PLAN (Minimum account value: $5,000)
Chubb Investment Funds is authorized to make Systematic
[_] Send to account registration
Withdrawal payments of: $______ or____% [_] Send to payee(s) noted below
(minimum amount $50)
[_] monthly [_] quarterly --------------------------------------
[_] semi-annually [_] annually Payee(s)
The [_] th day (or next business day
thereafter) --------------------------------------
of______ of______. Street
Month Year
--------------------------------------
- -------------------------------------- City State Zip Code
Portfolio Name
- --------------------------------------
Portfolio Account Number if Existing
- -------------------------------------------------------------------------------
SIGNATURE CERTIFICATION DEALER INFORMATION
I am (we are) of legal age and wish --------------------------------------
to establish an account in accordance Dealer Name
with the terms of the current
prospectus, which I acknowledge --------------------------------------
receiving, I authorize the Dealer Address (Main Office)
establishment of an account in
accordance with this application. --------------------------------------
Under penalties of perjury I certify City State Zip Code
(1) that the Social Security or
Taxpayer Identification Number shown --------------------------------------
on this form is my current Taxpayer Dealer Authorized Signature
Identification Number, and (2) I am
not subject to backup withholding --------------------------------------
either because I have not been Branch Address
notified by the Internal Revenue
Service (IRS) that I am subject to --------------------------------------
backup withholding as a result of a City State Zip Code
failure to report all interest or
dividends, or the IRS has notified me --------------------------------------
that I am no longer subject to backup Dealer Branch Office# Branch Phone #
withholding. The IRS does not require
your consent to any provision of this --------------------------------------
document other than the Rep #
certifications required to avoid * If shares are to be registered in
backup withholding. (1) joint names, both persons should
sign, (2) a custodian for a minor,
- -------------------------------------- the custodian should sign, (3) a
Signature* Date trust, the trustee(s) should sign, or
(4) a corporation or other entity, an
- -------------------------------------- officer should sign and print name
Signature of Co-Owner, if any Date and title on space provided below.
--------------------------------------
Print name and title of officer
signing for a corporation or other
entity.
<PAGE>
[ART] CHUBB INVESTMENT FUNDS, INC. CHECKING ACCOUNT
("The Company") SIGNATURE CARD
- -------------------------------------------------------------------------------
The Bank and the Company are expressly authorized to honor checks as
redemption instructions hereunder without requiring signature guarantees, and
shall not be liable for any loss or liability resulting from the absence of
any such guarantee.
2. CHECK PAYMENT: The Signatory(s) authorize and direct the Bank to pay each
check presented hereunder, subject to all laws and Bank rules and regulations
pertaining to checking accounts. In addition, the Signatory(s) agree(s) that:
(a) No check shall be issued or honored, or any redemption effected, in any
amount less than $250;
(b) No check shall be issued or honored, or redemption effected, for any
amounts represented by shares for which certificates have not been
issued;
(c) No check shall be issued or honored, or redemption effected, for any
amounts represented by shares unless payment for such shares has been
made in full and any checks given in such payment have been collected
through normal banking channels;
(d) No checks shall be issued or honored which would result in a
termination of the shareholder's account;
(e) Checks shall be subject to any further limitations set forth in the
Prospectus issued by the Company including without limitation any
additions, amendments and supplements thereto.
3. DUAL OWNERSHIP: If more than one person is indicated as a registered owner
of the shares of the Fund, as by joint ownership, ownership in common, or
tenants by the entireties, then (a) each registered owner must sign this
signature card, (b) each registered owner must sign each check issued
hereunder unless the parties have indicated on the face of this card that only
one need sign, in which case the Bank is authorized to act upon such
signature, and (c) each Signatory guarantees to the Bank the genuineness and
accuracy of the signature of other Signatory(s).
TERMINATION: The Bank and the Company may at any time terminate this account,
related share redemption service and the Bank's agency for the Signatory(s)
hereto without prior notice by the Bank to any of the Signatory(s).
HEIRS AND ASSIGNS: These terms and conditions shall bind the respective heirs,
executors, administrators and assigns of the Signatory(s).
- -------------------------------------------------------------------------------
PLEASE COMPLETE AND SIGN IF ELECTING REDEMPTION BY CHECK
(Available only for the Money Market Fund, the Government Securities Fund,
Global Income Fund and the Tax-Exempt Fund)
Signature card to establish a check redemption account, which allows you to
write a check against your Company account.
- -------------------------------------------------------------------------------
NAME(S)
ONE
- -------------------------------------- --------------------------------------
NUMBER OF SIGNATURES REQUIRED DATE
All registered owner(s) of the Company shares named above must sign below. By
signing his/her card the signatory(s) agree(s) to all of the terms and
conditions set forth on the reverse hereof.
SIGNATURES SOCIAL SECURITY OR TAX I.D. NUMBER
- -------------------------------------- --------------------------------------
- -------------------------------------- --------------------------------------
- -------------------------------------- --------------------------------------
<PAGE>
Distributor:
Chubb Securities Corporation
PO Box 205
One Granite Place
Concord, NH 03302
<PAGE>
CHUBB INVESTMENT FUNDS, INC.
ONE GRANITE PLACE
CONCORD, NEW HAMPSHIRE 03301
(603) 226-5000
This Statement of Additional Information is not a prospectus but supplements and
should be read in conjunction with the prospectus for Chubb Investment Funds,
Inc. (the "Company"). It is incorporated by reference into the Prospectus. A
copy of the Prospectus may be obtained from the Company at the address and
telephone number above.
The date of the Prospectus to which this Statement of Additional Information
relates is April 1, 1996.
The date of this Statement of Additional Information is April 1, 1996.
S-1
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS Page
<S> <C>
GENERAL INFORMATION AND HISTORY
INVESTMENT OBJECTIVES AND POLICIES
Investment Policies
Investment Restrictions
DESCRIPTION OF CERTAIN INVESTMENTS
Bank Obligations
Commercial Paper
United States Dollar Obligations of Foreign
Branches of United States Banks
Repurchase Agreements
Options and Futures
"When-Issued" and "Delayed Delivery Securities" and
"Forward Commitments"
Foreign Securities
Mortgage-Related Securities
Warrants
DESCRIPTION OF INVESTMENT RATINGS
Moody's - Bond Ratings
Moody's Commercial Paper Ratings
Standard & Poor's - Bond Ratings
Standard & Poor's Commercial Paper Ratings
INVESTMENT ADVISORY AND OTHER SERVICES
Investment Management
Transfer Agent
Independent Auditors
Custodians
MANAGEMENT OF THE COMPANY
PORTFOLIO TRANSACTIONS AND BROKERAGE ALLOCATIONS
CAPITAL STOCK
DISTRIBUTION OF THE COMPANY'S SHARES
Principal Underwriter
Distribution Plan
OFFERING AND REDEMPTION OF SHARES
DETERMINATION OF NET ASSET VALUE
MAINTENANCE OF NET ASSET VALUE PER SHARE FOR
THE MONEY MARKET FUND
TAXES AND DIVIDENDS
PERFORMANCE AND YIELD INFORMATION
ADDITIONAL INFORMATION
Name and Service Mark
FINANCIAL STATEMENTS
</TABLE>
S-2
<PAGE>
GENERAL INFORMATION AND HISTORY
Chubb Investment Funds, Inc.,(the "Company") is comprised of seven separate
portfolios (the "Funds"). Six portfolios of the Company are open-end,
diversified management investment companies and one portfolio, Chubb Global
Income Fund, is an open-end non-diversified investment company and are
registered as such under the Investment Company Act of 1940 (the "1940 Act").
The Company was incorporated on April 27, 1987 and had no business history prior
to its formation.
INVESTMENT OBJECTIVES AND POLICIES
INVESTMENT POLICIES
The investment objectives and policies of each Fund are described in the
Company's Prospectus under the heading "Investment Objectives and Policies" with
each Fund's policies being described specifically under its own sub-heading. The
following information supplements the discussion of investment objectives and
policies for each Fund contained in the Company's Prospectus. Unless otherwise
specified, the investment policies and restrictions of each Fund are not
fundamental policies and may be changed by the Company's Board of Directors
without shareholder approval. Shareholders will be notified prior to any
material change. The investment objectives of each Fund are fundamental policies
and may be changed only with shareholder approval.
INVESTMENT RESTRICTIONS
Each Fund has adopted the following restrictions relating to the investments
of each Fund. The investment restrictions numbered 1 through 7, 10 and 13 are
fundamental policies of each Fund and may not be changed without approval of a
majority of the outstanding shares of each affected Fund. Each restriction
applies to each Fund of the Company, unless otherwise indicated. A change in
policy affecting only one Fund may be effected with the approval of a majority
of the outstanding shares of that Fund only. (As used in the Prospectus and this
Statement of Additional Information, the term "majority of the outstanding
voting shares" means the lesser of (1) 67% of the shares represented at a
meeting of which more than 50% of the outstanding share are represented or (2)
more than 50% of the outstanding shares.) All other investment restrictions are
operating policies and are subject to change by the Company's Board of Directors
without shareholder approval. No investment restriction which involves a maximum
percentage of securities or assets will be considered to be violated unless the
excess over the percentage occurs immediately after and is caused by an
acquisition or borrowing of securities or assets by the Fund. A Fund will not:
S-3
<PAGE>
1. Issue securities senior to its common stock, except to the extent that
permissible borrowings may be so construed. For purposes hereof, writing
covered call options and entering into futures contracts, to the extent
permitted by restrictions 8 and 10 below, shall not involve the issuance of
senior securities or borrowings.
2. Buy securities on margin, except that it may: (a) obtain such short-term
credits as may be necessary for the clearance of purchases and sales of
securities, and (b) make margin deposits in connection with futures
contracts, subject to restrictions 10 and 11 below.
3. Borrow money, except each Fund may, as a temporary measure for extraordinary
or emergency purposes, including to cover net redemptions, and not for
investment purposes, borrow from banks and then only in amounts not
exceeding 5% of its total assets. In addition, no Fund may pledge, mortgage
or hypothecate its assets except in connection with permissible borrowings
and then only in amounts not exceeding 10% of the value of its total assets.
A Fund will not pledge, mortgage or hypothecate its assets to the extent
that at any time the percentage of pledged assets plus the sales commission
will exceed 10% of the value of its total assets. This restriction will not
prevent a Fund from (a) purchasing securities on a "forward commitment",
"delayed delivery" or "when-issued" basis or (b) entering into futures
contracts as set forth below in restriction 10 or as regards the Global
Income Fund entering into reverse repurchase agreements, provided that a
segregated account consisting of cash or liquid high grade debt securities
in an amount equal to the total value of the securities underlying such
agreement is established and maintained.
4. Act as an underwriter of securities of other issuers except to the extent
that it may be deemed to be an underwriter within the meaning of the
Securities Act of 1933 (a) in reselling securities, such as restricted
securities, acquired in private transactions and subsequently registered
under the Securities Act of 1933, and (b) in connection with the purchase of
government securities directly from the issuer, or (c) with respect to the
Capital Appreciation Fund and Global Income Fund, except to the extent that
the disposition of a security may technically cause it to be considered an
underwriter as that term is defined under the Securities Act of 1933.
S-4
<PAGE>
5. Invest 25% or more of the value of the total assets of any Fund, except the
Global Income Fund, in securities of issuers having their principal business
activities in the same industry. With respect to the Money Market Fund only,
debt securities issued by domestic banks will not be subject to this
restriction. This restriction also shall not apply to: (i) securities issued
or guaranteed by the United States Government, its agents or
instrumentalities and (ii) tax-exempt securities issued by governments or
political subdivisions of governments. For purposes of this restriction
industrial development bonds issued by non-governmental issuers will not be
considered to be tax-exempt securities.
6. Invest in real estate, although the Funds may buy securities of companies
which deal in real estate, and securities which are secured by readily
marketable interests in real estate, including interests in real estate
investment trusts, real estate limited partnerships, real estate investment
conduits or mortgage related instruments issued or backed by the United
States Government, its agencies or its instrumentalities. However, as a
matter of operating policy in accordance with state securities law
restrictions, the Funds will not invest in real estate limited partnerships
other than master limited partnerships traded on a national securities
exchange.
7. Make loans, except the Funds may: (a) purchase bonds, debentures, notes and
other debt obligations customarily either publicly distributed or
distributed privately to institutional investors and within the limits
imposed on the acquisition of restricted securities set forth in restriction
11, and (b) enter into repurchase agreements with respect to its portfolio
securities.
8. Write options, except that all the Funds, except the Money Market Fund, may
write covered call options, and the Global Income Fund may write put
options, provided that as a result of such sale, a Fund's securities
covering all call options or subject to put options would not exceed 25% of
the value of the Fund's total assets.
9. Purchase options, except that all the Funds, except the Money Market Fund,
may purchase put options and the Global Income Fund may purchase put and
call options provided that the total premiums paid for such outstanding
options owned by a Fund does not exceed 5% of its total assets. No Fund,
except the Global Income Fund, may write put options on securities other
than to close out previously purchased put options.
S-5
<PAGE>
10. Enter into commodity contracts, except that all the Funds, except the Money
Market Fund, may enter into financial futures contracts and the Global
Income Fund may also enter into foreign currency hedging contracts and stock
index futures contracts if, immediately thereafter: (a) the total of the
initial margin deposits required with respect to all open futures positions
at the time such positions were established, plus the sum of the premiums
paid for all unexpired options on futures contracts would not exceed 5% of
the value of a Fund's total assets, and (b) a segregated account consisting
of cash or liquid high-grade debt securities in an amount equal to the total
market value of any futures contract purchased by a Fund, less the amount of
any initial margin, is established.
11. Invest more than 10%, or in the case of the Global Income Fund and Capital
Appreciation Fund 15%, of the net asset value of any Fund in securities
which are not readily marketable, such as repurchase agreements having a
maturity of more than 7 days, restricted securities, time deposits with
maturities of more than 7 days, and other securities which are not otherwise
readily marketable, provided, however, that the Global Income Fund and
Capital Appreciation Fund may invest without limitation in restricted
securities issued under Rule 144A of the Securities Act of 1933 provided the
Board of Directors or the Investment Manager under the direction of the
Board of Directors has determined that each such security is liquid.
12. Invest more than 10% of the value of its total assets in securities of other
open-end and closed-end investment companies, except by purchases in the
open market involving only customary broker's commissions or as part of a
merger, consolidation, or acquisition, or as otherwise permitted by the 1940
Act and rules thereunder.
13. Except with respect to the Global Income Fund, make an investment unless,
when considering all its other investments, 75% of the value of the Fund's
total assets would consist of cash, cash items, United States Government
securities, securities of other investment companies, and other securities.
For purposes of this restriction, the purchase of "other securities" is
limited so that (a) no more than 5% of the value of the Fund's total assets
would be invested in any one issuer and (b) no more than 10% of the issuer's
outstanding voting securities would be held by the Company. As a matter of
operating policy, the Money Market Fund will invest no more than 5% of the
value of that Fund's total assets in securities, other than United States
Government
S-6
<PAGE>
securities, of any one issuer, except that the Money Market Fund may invest
up to 25% of its total assets in First Tier Securities (as defined in Rule
2a-7 of the 1940 Act) of a single issuer for a period of up to three
business days after the purchase of such security. Further, as a matter of
operating policy, the Money Market Fund will not invest more than (i) the
greater of 1% of its total assets or $1,000,000 in Second Tier Securities
(as defined in Rule 2a-7 of the 1940 Act) of a single issuer and (ii) 5% of
the Money Market Fund's total assets, when acquired in Second Tier
Securities. As a matter of operating policy, the Company will not consider
repurchase agreements to be subject to this 5% limitation if all the
collateral underlying the repurchase agreements are United States Government
Securities.
14. Invest more than 5% of the value of the total assets of the Fund in
securities of companies having, at the time of purchase, a record of less
than 3 years' continuous operations, including predecessors and
unconditional guarantors.
15. Enter into a repurchase agreement with Chubb Life Insurance Company of
America ("Chubb Life"), The Chubb Corporation, or a subsidiary of either
such corporation.
16. Participate on a joint or joint and several basis in any trading account in
securities, although transactions for the Funds and any other account under
common management may be combined or allocated between the Fund and such
account.
17. Invest in companies for the sole purpose of exercising control or
management.
18. Invest in interests, other than debentures or equity stock interests, in
oil and gas or other mineral exploration or development programs.
19. Invest more than 5% of the value of the total assets of the Fund in
warrants, whether or not the warrants are listed on the New York or American
Stock Exchanges, or more than 2% of the value of the assets of a Fund in
warrants which are not listed on those exchanges. Warrants acquired in units
or attached to securities are not included in this restriction.
20. Invest in securities of foreign issuers, except that the Money Market Fund
may invest up to 10% of the value of its total assets in U.S. dollar
denominated securities of foreign issuers, and the Total Return Fund and the
Growth
S-7
<PAGE>
and Income Fund and the Capital Appreciation Fund may invest up to 20% of
the value of their total assets in securities of foreign issuers including
ADRs. The Global Income Fund may invest an unlimited percentage of its
assets in securities of foreign issuers, developed or undeveloped, or
whether listed on an exchange or unlisted.
21. Invest in securities of any issuer if the officers and directors of the
Company or the Investment Manager or Investment Administrator own
individually more than 1/2 of 1% of such issuer's securities or together own
more than 5% of such issuer's securities.
22. Effect short sales of securities, except short sales against the box.
DESCRIPTION OF CERTAIN INVESTMENTS
The following is a description of certain types of investments which may be made
by the Funds.
BANK OBLIGATIONS
All of the Funds may acquire obligations of banks with total assets of at
least $500,000,000. These include certificates of deposit, bankers' acceptances,
and time deposits, all of which are normally limited to $100,000 per Fund from
any one bank. Certificates of deposit are generally short-term, interest-bearing
negotiable certificates issued by commercial banks or savings and loan
associations against funds deposited in the issuing institution. Bankers'
acceptances are time drafts drawn on a commercial bank by a borrower, usually in
connection with an international commercial transaction (to finance the import,
export, transfer or storage of goods). With a bankers' acceptance, the borrower
is liable for payment as is the bank, which unconditionally guarantees to pay
the draft at its face amount on the maturity date. Most bankers' acceptances
have maturities of six months or less and are traded in secondary markets prior
to maturity. Time deposits are generally short-term, interest-bearing negotiable
obligations issued by commercial banks against funds deposited in the issuing
institutions. None of the Funds will invest in time deposits maturing in more
than seven days.
The Money Market Fund will not invest in any security issued by a commercial
bank unless the bank is organized and operating in the United States and is a
member of the Federal Deposit Insurance Corporation ("FDIC"). However, this
limitation shall not prohibit investments in foreign branches of the United
States banks and United States branches of foreign banks which otherwise meet
the foregoing requirements.
S-8
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COMMERCIAL PAPER
All the Funds may invest in commercial paper. Commercial paper involves an
unsecured promissory note issued by a corporation. It is usually sold on a
discount basis and has a maturity at the time of issuance of 9 months or less.
On the date of investment, with respect to the Money Market Fund, such paper or
its issuer must be rated in one of the two highest commercial paper rating
categories by at least two nationally recognized statistical rating
organizations ("NRSROs") which have issued a rating with respect to such
commercial paper or its issuer or by one NRSRO if that paper or its issuer has
been rated by only one NRSRO ("Requisite NRSROs") or, if not rated, must be of
comparable quality. The Funds, other than the Money Market Fund, may invest in
commercial paper rated within the three highest categories by Moody's, Standard
& Poor's or other NRSROs or, if not rated, which are of equivalent investment
quality in the judgment of the Investment Manager.
UNITED STATES DOLLAR OBLIGATIONS OF FOREIGN BRANCHES OF UNITED STATES BANKS
The Money Market Fund may invest in United States dollar obligations of
foreign branches of FDIC-member United States banks. These instruments represent
the loan of funds actually on deposit in the United States. The Company believes
that the United States bank would be liable in the event that the foreign branch
failed to pay on its United States dollar obligations. Nevertheless, the assets
supporting the liability could be expropriated or otherwise restricted if
located outside the United States. Exchange controls, taxes, or political and
economic developments could affect liquidity or repayment. Because of possibly
conflicting laws or regulations, the issuing bank could maintain that the
liability is solely that of the branch, thus exposing the Fund to a possible
loss. Such United States dollar denominated obligations of foreign branches of
FDIC-member United States banks are not covered by the usual $100,000 FDIC
insurance if they are payable only at an office of such a bank located outside
the United States, the District of Columbia, Puerto Rico, Guam, American Samoa,
and the U.S. Virgin Islands. The Money Market Fund will limit its investment in
foreign U.S. dollar-denominated obligations to no more than 10% of the Fund's
total assets and the Global Income Fund has no such limitation.
SAMURAI AND YANKEE BONDS
All of the Funds except the Money Market Fund may invest in yen-denominated
bonds sold in Japan by non-Japanese issuers ("Samurai bonds") and in U.S. dollar
denominated bonds sold in the United States by non-U.S. issuers ("Yankee
bonds"). As compared to bonds issued in their country of domicile, such bond
normally carry a higher rate of interest, but are less actively traded. It is
the policy of each Fund to invest in Samurai bonds and Yankee bonds
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only after taking into account considerations of quality and liquidity as well
as yield. These bonds would be issued by governments which are members of the
Organization for Economic Cooperation and Development or have AAA ratings.
BRADY BONDS
All of the Funds, except the Money Market Fund and the Government Securities
Fund may, subject to their investment restrictions, invest in "Brady Bonds",
which are debt restructurings that provide for the exchange of cash and loans
for newly issued bonds. Brady Bonds have been issued by Argentina, Brazil,
Bulgaria, Costa Rica, Dominican Republic, Jordan, Mexico, Nigeria, Philippines,
Poland, Uruguay Venezuela, and are expected to be issued by Ecuador and other
emerging countries. The largest proportion of Brady Bonds outstanding has been
issued by Brazil and Argentina, both nation's issues are rated below investment
grade. However the Company is not aware of any payment defaults on Brady Bonds.
Investors should realize that Brady Bonds are a recent innovation and do not
have a long payment history. Brady Bonds may be collateralized or
uncollateralized and are issued in various currencies (primarily dollars) and
are actively traded in the secondary market for Latin America debt. The Funds
may invest in either collateralized or uncollateralized Brady Bonds. U.S. dollar
denominated collateralized Brady Bonds, which may be fixed rate par bonds or
floating rate discount bonds, are collateralized in full as to principal by U.S.
Treasury zero coupon bonds having the same maturity as the bonds. Interest
payments on such bonds generally are collateralized by cash or securities in an
amount that, in the case of fixed rate bonds is equal to at least one year of
rolling interest payments or, in the case of floating rate bonds is initially
equal to at least one year's rolling interest payments based upon the applicable
interest rate at that time and is adjusted at regular intervals thereafter.
REPURCHASE AGREEMENTS
All of the Funds may invest in repurchase agreements. A repurchase agreement
customarily obligates the seller, at the time it sells securities to a Fund, to
repurchase the securities at a mutually agreed upon time and price. The total
amount received on repurchase would be calculated to exceed the price paid by
the Fund, reflecting an agreed upon market rate of interest for the period from
the time of the repurchase agreement to the settlement date, and would not
necessarily be related to the interest rate on the underlying securities. The
differences between the total amount to be received upon repurchase of the
securities and the price which was paid by the Fund upon their acquisition is
accrued as interest and is included in the Fund's net income declared as
dividends. The underlying securities will consist of high-quality liquid
securities. With respect to the Money Market Fund, the underlying security must
be either a United States Government
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security or a security rated in the highest rating category by the Requisite
NRSROs and must be determined to present minimal credit risk. The Fund has the
right to sell securities subject to repurchase agreements but would be required
to deliver identical securities upon maturity of the repurchase agreements
unless the seller fails to pay the repurchase price. It is each Fund's intention
not to sell securities subject to repurchase agreements prior to the agreement's
maturity.
During the holding period of a repurchase agreement, the seller must "mark to
market" the collateral on a daily basis and must provide additional collateral
if the market value of the obligation falls below the repurchase price. If a
Fund acquires a repurchase agreement and then the seller defaults at a time when
the value of the underlying securities is less than the obligation of the
seller, the Company could incur a loss. If the seller defaults or becomes
insolvent, a Fund could realize delays, costs, or a loss in asserting its rights
to the collateral in satisfaction of the seller's repurchase agreement. The Fund
will enter into repurchase agreements only with sellers who are believed by the
Investment Manager to present minimal credit risks and whose creditworthiness
has been evaluated by the Investment Manager in accordance with certain
guidelines and is subject to periodic review by the Board of Directors of the
Company. Currently, these guidelines require sellers who are broker-dealers to
have a net worth of at least $25,000,000, although this requirement may be
waived by the Board of Directors of the Company on the recommendation of the
Investment Manager, and sellers who are banks to have assets of at least
$1,000,000,000. The seller also must be considered by the Investment Manager to
be an institution of impeccable reputation and integrity, and the Investment
Manager must be acquainted with and satisfied with the individuals at the seller
with whom it deals.
REVERSE REPURCHASE AGREEMENTS
In order to generate additional income the Global Income Fund may engage in
reverse repurchase agreement transactions with banks, broker-dealers and other
financial intermediaries. Reverse repurchase agreements are the same as
repurchase agreements except that the Fund assumes the role of seller/borrower
in the transaction. The Fund will maintain segregated accounts at the custodian
containing liquid, high grade, debt securities that at all times are equal to
its obligations under the repurchase agreements. The Fund will invest the
proceeds in other money market instruments or repurchase agreements maturing not
later than the expiration of the reverse repurchase agreement. Reverse
repurchase agreements involve the risk that the market value of the securities
sold by the Fund may decline below the repurchase price of the securities.
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LOAN PARTICIPATIONS AND OTHER DIRECT INDEBTEDNESS
The Funds may purchase loan participations and other direct indebtedness. In
purchasing a loan participation, the Fund acquires some or all of the interest
of a bank or other lending institution in a loan to a corporate borrower. Many
such loans are secured, although some may be unsecured. Such loans may be in
default at the time of purchase. Loans and other direct indebtedness that are
fully secured offer the Fund more protection than an unsecured loan in the event
non-payment of scheduled interest or principal. However, there is no assurance
that liquidation of collateral from a secured loan or other direct indebtedness
would satisfy the corporate borrower's obligation, or that collateral can be
liquidated.
These loans and other direct indebtedness are made generally to finance
internal growth, mergers, acquisitions, stock repurchases, leveraged buy-outs
and other corporate activities. Such loans and other direct indebtedness loans
are generally made by a syndicate of lending institutions, represented by an
agent lending institution, which has negotiated and structured the loan and is
responsible for collecting interest, principal and other amounts due on its own
behalf and on behalf of the others in the syndicate, and for enforcing its and
their other rights against the borrower. Alternatively such loans and other
direct indebtedness may be structured as a novation, pursuant to which the Fund
would assume all of the rights of the lending institution in a loan, or as an
assignment, pursuant to which the Fund would purchase an assignment of a portion
of a lender's interest in a loan or other direct indebtedness either directly
from the lender or through an intermediary. The Fund may also purchase trade or
other claims against companies, which generally represent money owed by the
company to a supplier of goods or services. These claims may also be purchased
at a time when the company is in default.
Certain of the loan participations and other direct indebtedness acquired by
the Fund may involve revolving credit facilities or other standby financing
commitments which obligate the Fund to pay additional cash on a certain date or
on demand. These commitments may have the effect of requiring the Fund to
increase its investment in a company when the Fund might not otherwise decide to
do so (including at a time when the company's financial condition makes it
unlikely that such amounts will be repaid). To the extent that the Fund is
committed to advance additional funds, it will at all times hold and maintain in
a segregated account cash of high grade debt obligations in an amount sufficient
to meet such commitments.
The Fund's ability to receive payment of principal, interest and other amounts
due in connection with these investments will depend primarily on the financial
condition of the borrower. In selecting the loan participations and other direct
indebtedness which the
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Fund will purchase, the Investment Manager will rely upon its own (and not upon
the original lending institution's) credit analysis of the borrower. As the Fund
may be required to rely upon another institution to collect and pass on to the
Fund amounts payable with respect to the loan and other direct indebtedness, an
insolvency, bankruptcy or reorganization of the lending institution may delay or
prevent the Fund from receiving such amounts. In such cases the Fund will
evaluate as well the creditworthiness of the lending institution and will treat
both the borrower and the lending institution as an "issuer" of the loan
participation for purposes of the certain investment restrictions pertaining to
the diversification of the Fund's portfolio investments. The highly leveraged
nature of many such loans and other direct indebtedness may make such loans
especially vulnerable to adverse changes in economic or market conditions.
Investments in such loans and other direct indebtedness may involve additional
risk to the Fund. For example, if a loan or other direct indebtedness is
foreclosed, the Fund could become part owner of any collateral, and would bear
the costs and liabilities associated with owning and disposing of the
collateral. In addition, it is conceivable that under emerging legal theories of
lender liability, the Fund could be held liable as a co-lender. It is unclear
whether loans and other forms of direct indebtedness offer securities law
protections against fraud and misrepresentation. In the absence of definitive
regulatory guidance, the Fund relies on the Investment Manager's research in an
attempt to avoid situations where fraud and misrepresentation could adversely
affect the Fund. In addition, loan participations and other direct investments
may not be in the form of securities or may be subject to restrictions on
transfer, and only limited opportunities may exist to resell such investments.
As a result, the Fund may be unable to sell such investments at an opportune
time or may have to resell them at less than fair market value. To the extent
that the Investment Manager determines that such investments are illiquid, the
Fund will include them in the investment limitations above.
OPTIONS AND FUTURES
CALL OPTIONS. All the Funds, except the Money Market Fund, may write (sell)
covered call options which are traded on national and international securities
exchanges to enhance investment performance or for hedging purposes. A call
option is a contract that gives the holder (buyer) of the option the right to
buy (in return for a premium paid), and the writer of the option (in return for
a premium received) the obligation to sell, the underlying security at a
specified price (the exercise price) at any time before the option expires. A
covered call option is a call in which the writer of the option, for example,
owns the underlying security throughout the option period or has deposited in a
separate account with the Company's custodian liquid high-grade debt obligations
or cash equal in value to the exercise price of the option.
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A Fund will write covered call options both to reduce the risks associated
with certain of its investments and to increase total investment return through
the receipt of premiums. In return for the premium income, the Fund will give up
the opportunity to profit from an increase in the market price of the underlying
security above the exercise price so long as its obligations under the contract
continue, except insofar as the premium represents a profit. Moreover, in
writing the call option, the Fund will retain the risk of loss should the price
of the security decline. The premium is intended to offset that loss in whole or
in part. Unlike the situation in which the Fund owns securities not subject to a
call option, the Fund, in writing call options, must assume that the call may be
exercised at any time prior to the expiration of its obligation as a seller, and
that in such circumstances the net proceeds realized from the sale of the
underlying securities pursuant to the call may be substantially below the
prevailing market price, although it must be at the previously agreed to
exercise price.
A Fund may protect itself from loss due to a decline in value of the
underlying security or from the loss of appreciation due to its rise in value by
buying an identical option, in which case the purchase cost of such option may
offset the premium received for the option previously written. In order to do
this, the Fund makes a "closing purchase transaction" on the purchase of a call
option on the same security with the same exercise price and expiration date as
the covered call option that it has previously written. The Fund will realize a
gain or loss from a closing purchase transaction if the amount paid to purchase
a call option is less or more than the amount received from the sale of the
corresponding call option. Also, because increases in the market price of a call
option will generally reflect increases in the market price of the underlying
security, any loss resulting from the exercise or closing out of a call option
is likely to be offset in whole or in part by unrealized appreciation of the
underlying security owned by the Fund.
There is no assurance that a liquid market will exist for any particular
option, at any particular time, and for some options no market may exist. If a
Fund is unable to effect a closing purchase transaction, a Fund will not sell
the underlying security until the option expires or the Fund delivers the
underlying security upon exercise.
PURCHASING PUT OPTIONS. All the Funds, except the Money Market Fund, may
purchase put options and the Global Income Fund may also sell covered put
options. A Fund may purchase put options on securities to protect its holdings
in an underlying or related security against an anticipated decline in market
value. Such hedge protection is provided only during the life of the put option.
Securities are considered related if their price movements generally correlate
with one another. The purchase of put options
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on securities held by a Fund or related to such securities will enable a Fund to
preserve, at least partially, unrealized gains in an appreciated security in its
portfolio without actually selling the security. In addition, a Fund will
continue to receive interest or dividend income on the security. A Fund may also
sell put options it has previously purchased, which could result in a net gain
or loss depending on whether the amount received on the sale is more or less
than the premium and other transaction costs paid on the put option which was
bought.
OPTIONS ON INDEXES. All the Funds, except the Money Market Fund, may write
covered call options and may purchase put options on appropriate securities
indexes for the purpose of hedging against the risk of unfavorable price
movements adversely affecting the value of a Fund's securities or to enhance
income. Unlike a stock option, which gives the holder the right to purchase or
sell a specified stock at a specified price, an option on a securities index
gives the holder the right to receive a cash settlement amount based upon price
movements in the stock market generally (or in a particular industry or segment
of the market represented by the index) rather than the price movements in
individual stocks.
The value of a securities index fluctuates with changes in the market values
of the securities which are contained in the index. For example, some securities
index options are based on a broad market index such as the Standard & Poor's
500 or the NYSE Composite Index, or a narrower market index such as the Standard
& Poor's 100. Indexes may also be based on an industry or market segment such as
the AMEX Oil and Gas Index or the Computer and Business Equipment Index. Options
on stock indexes are traded on exchanges or traded over-the-counter ("OTC
options"). Listed options are third-party contracts (i.e., performance of the
obligations of the purchaser and seller is guaranteed by the exchange or
clearing corporation) and have standardized strike prices and expiration dates.
OTC options are two-party contracts with negotiated strike prices and expiration
dates.
The effectiveness of hedging through the purchase or sale of securities index
options will depend upon the extent to which price movements in the portion of
the securities portfolio being hedged correlate with price movements in the
selected securities index. Perfect correlation is not possible because the
securities held or to be acquired by a Fund will not exactly match the
composition of the securities indexes on which options are purchased or written.
In the purchase of securities index options, the principal risk is that the
premium and transaction costs paid by a Fund in purchasing an option will be
lost as a result of unanticipated movements in the price of the securities
comprising the securities index for which the option has been purchased. In
writing securities index options, the principal risks are the inability to
effect closing transactions at favorable prices and the inability to participate
in the appreciation of the underlying securities.
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FUTURES TRANSACTIONS. A futures contract is an agreement to buy or sell a
security (or deliver a final cash settlement price, in the case of a contract
relating to an index or otherwise not calling for physical delivery at the end
of trading in the contracts) for a set price in the future. Futures exchanges
and trading in futures is regulated under the Commodity Exchange Act by the
Commodity Futures Trading Commission ("CFTC").
Positions taken in the futures markets are not normally held until delivery or
cash settlement is required, but are instead liquidated through offsetting
transactions which may result in a gain or a loss. A clearing organization
associated with the exchange on which futures are traded assumes responsibility
for closing-out transactions and guarantees that, as between the clearing
members of an exchange, the sale and purchase obligations will be performed with
regard to all positions that remain open at the termination of the contract.
Upon entering into a futures contract, a Fund will be required to deposit with
a futures commission merchant a certain percentage (usually 1% to 5%) of the
futures contracts market value as initial margin. As a general matter, a Fund
may not commit in the aggregate more than 5% of the market value of its total
assets to initial margin deposits on the Fund's existing futures contracts and
premium paid for options on unexpired futures contracts. Initial margin is in
the nature of a performance bond or good faith deposit on the contract which is
returned upon termination of the futures contract if all contractual obligations
have been satisfied. The initial margin in most cases will consist of cash or
United States Government securities. Subsequent payments, called variation
margin, may be made with the futures commission merchant as a result of marking
the contracts to market on a daily basis as the contract value fluctuates.
FUTURES ON DEBT SECURITIES. A futures contract on a debt security is a binding
contractual commitment which, if held to maturity, will result in an obligation
to make or accept delivery, during a particular future month, of securities
having a standardized face value and rate of return. All of the Funds, except
the Money Market Fund, may buy and sell futures contracts on debt securities. By
purchasing futures on debt securities -assuming a "long" position- a Fund will
legally obligate itself to accept the future delivery of the underlying security
and pay the agreed price. By selling futures on debt securities - assuming a
"short" position - it will legally obligate itself to make the future delivery
of the security against payment of the agreed price. Open future positions on
debt securities will be valued at the most recent settlement price, unless such
price does not appear to the Investment Manager to reflect the fair value of the
contract, in which case the positions will be valued by, or under the direction
of, the Board of Directors.
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The Funds by hedging through the use of futures on debt securities seek to
establish more certainty with respect to the effective rate of return on their
portfolio securities. A Fund may, for example, take a "short" position in the
futures market by selling contracts for the future delivery of debt securities
held by the Fund (or securities having characteristics similar to those held by
the Fund) in order to hedge against an anticipated rise in interest rates that
would adversely affect the value of the Fund's portfolio securities. When
hedging of this character is successful, any depreciation in the value of
portfolio securities will be substantially offset by appreciation in the value
of the futures position.
On other occasions, a Fund may take a "long" position by purchasing futures on
debt securities. This would be done, for example, when the Fund intends to
purchase particular debt securities, but expects the rate of return available in
the bond market at that time to be less favorable than rates currently available
in the futures markets. If the anticipated rise in the price of the debt
securities contracts should occur (with its concomitant reduction in yield), the
increased cost to the Fund of purchasing the debt securities will be offset, at
least to some extent, by the rise in the value of the futures position in debt
securities taken in anticipation of the subsequent purchase of such debt
securities.
The Fund could accomplish similar results by selling debt securities with long
maturities and investing in debt securities with short maturities when interest
rates are expected to increase or by buying debt securities with long maturities
and selling debt securities with short maturities when interest rates are
expected to decline. However, by using futures contracts as a risk management
technique (to reduce a Fund's exposure to interest rate fluctuations), given the
greater liquidity in the futures market than in the bond market, it might be
possible to accomplish the same result more effectively and perhaps at a lower
cost. See Limitations on Purchase and Sale of Futures Contracts and Options on
Futures Contracts below.
INTEREST RATE AND CURRENCY FUTURES CONTRACTS The Funds, except the Money
Market Fund, may enter into interest rate or currency futures contracts,
including futures contracts on indices of debt securities, as a hedge against
changes in prevailing levels of interest rates or currency exchange rates in
order to establish more definitely the effective rate of return on securities or
currencies held or intended to be acquired. Hedging may include sales of futures
as a hedge against the effect or expected increases in interest rates or
decreases in currency exchange rates, and purchases of futures as an offset
against the effect of expected declines in interest rates or increases in
currency exchange rates.
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STOCK INDEX FUTURES CONTRACTS. A stock index futures contract does not require
the physical delivery of securities, but merely provides for profits and losses
resulting from changes in the market value of the futures contract to be
credited or debited at the close of each trading day to the respective accounts
of the parties to the contract. On the contract's expiration date, a final cash
settlement occurs and the futures positions are simply closed out. Changes in
the market value of a particular stock index futures contract reflect changes in
the specified index of equity securities on which the futures contract is based.
The Total Return Fund, the Growth and Income Fund, the Capital Appreciation Fund
and the Global Income Fund may buy and sell stock index futures contracts.
Stock index futures may be used to hedge the equity portion of a Fund's
securities portfolio with regard to market risk (involving the market's
assessment of over-all economic prospects), as distinguished from stock-specific
risk (involving the market's evaluation of the merits of the issuer of a
particular security). By establishing an appropriate "short" position in stock
index futures contracts, a Fund may seek to protect the value of its portfolio
against an overall decline in the market for equity securities. Alternatively,
in anticipation of a generally rising market, a Fund can seek to avoid losing
the benefit of apparently low current prices by establishing a "long" position
in stock index futures contracts and later liquidating that position as
particular equity securities are in fact acquired. To the extent that these
hedging strategies are successful, a Fund will be affected to a lesser degree by
adverse overall market price movements, unrelated to the merits of specific
portfolio equity securities, than would otherwise be the case. See Limitations
on Purchase and Sale of Futures Contracts and Options on Futures Contracts;
below.
OPTIONS ON FUTURES CONTRACTS. For bona fide hedging purposes, all the Funds
except the Money Market Fund may purchase and the Global Income Fund may sell
put options and write call options on futures contracts. These options are
traded on exchanges that are licensed and regulated by the CFTC for the purpose
of options trading. A call option on a futures contract gives the purchaser the
right, in return for the premium paid, to purchase a futures contract (assume a
"long" position) at a specified exercise price at any time before the option
expires. A put option gives the purchaser the right, in return for the premium
paid, to sell a futures contract (assume a "short" position) at a specified
exercise price at any time before the option expires. Upon the exercise of a
call, the writer of the option is obligated to sell the futures contract (to
deliver a "long" position to the option holder) at the option exercise price,
which presumably will be lower than the current market price of the contract in
the futures market. Upon exercise of a put, the writer of the option is
obligated to purchase the futures contract (to
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deliver a "short" position to the option holder) at the option exercise price
which presumably will be higher than the current market price of the contract in
the futures market.
When a Fund, as a purchaser of a put option on a futures contract, exercises
such option and assumes a short futures position, its gain will be credited to
its futures variation margin account. Any loss suffered by the writer of the
option of a futures contract will be debited to its futures variation margin
account. However, as with the trading of futures, most participants in the
options markets do not seek to realize their gains or losses by exercise of
their option rights. Instead, the holder of an option usually will realize a
gain or loss by buying or selling an offsetting option at a market price that
will reflect an increase or a decrease from the premium originally paid as
purchaser or required as a writer.
Options on futures contracts can be used by a Fund to hedge the same risks as
might be addressed by the direct purchase or sale of the underlying futures
contracts themselves. Depending on the pricing of the option, compared to either
the futures contract upon which it is based or upon the price of the underlying
securities themselves, it may or may not be less risky than direct ownership of
the futures contract or the underlying securities.
In contrast to a futures transaction, in which only transaction costs are
involved, benefits received by a Fund as a purchaser in an option transaction
will be reduced by the amount of the premium paid as well as by transaction
costs. In the event of an adverse market movement, however, a Fund which
purchased an option will not be subject to a risk of loss on the option
transaction beyond the price of the premium it paid plus its transaction costs,
and may consequently benefit from a favorable movement in the value of its
portfolio securities that would have been more completely offset if the hedge
had been effected through the use of futures contracts.
If a Fund writes call options on futures contracts, the Fund will receive a
premium but will assume a risk of adverse movement in the price of the
underlying futures contract comparable to that involved in holding a futures
position. If the option is not exercised, the Fund will realize a gain in the
amount of the premium, which may partially offset unfavorable changes in the
value of securities held by, or to be acquired for, the Fund. If the option is
exercised, the Fund will incur a loss in the option transaction, which will be
reduced by the amount of the premium it has received, but which may be partially
offset by favorable changes in the value of its portfolio securities.
While the purchaser or writer of an option on a futures contract may normally
terminate its position by selling or purchasing an offsetting option of the same
series, a Fund's ability to establish and close out options positions at fairly
established prices will be subject to the existence of a liquid market. The
Funds will not
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purchase or write options on futures contracts unless, in the Investment
Manager's opinion, the market for such options has sufficient liquidity that the
risks associated with such options transactions are not at unacceptable levels.
FOREIGN CURRENCY EXCHANGE CONTRACTS AND OPTIONS ON FOREIGN CURRENCIES. In
order to hedge against foreign currency exchange rate risks, the Global Income
Fund may enter into forward currency exchange contracts ("forward currency
contracts"), as well as purchase put or call options on foreign currencies. A
forward currency contract is an obligation to purchase or sell a specific
currency for an agreed price at a future date which is individually negotiated
and privately traded by currency traders and their customers. In addition, for
hedging purposes only, the Global Income Fund may enter into foreign currency
futures contracts. The Global Income Fund may also conduct their foreign
currency exchange transactions on a spot (i.e., cash) basis at the spot rate
prevailing in the currency exchange market.
LIMITATIONS ON PURCHASE AND SALE OF FUTURES CONTRACTS AND OPTIONS ON FUTURES
CONTRACTS. The Funds will engage in transactions in futures contracts and
related options only for bona fide hedging purposes and not for speculation. The
Funds may not purchase or sell futures contracts or related options if
immediately thereafter the sum of the amounts of initial margin deposits on a
Fund's existing futures contracts and premiums paid for unexpired options on
futures contracts would exceed 5% of the value of the Fund's total assets;
provided, however, that in the case of an option that is "in-the-money" at the
time of purchase, the "in-the-money" amount may be excluded in calculating the
5% limitation. In instances involving the purchase or sale of futures contracts
or the writing of covered call options thereon by a Fund, such positions will
always be "covered", as appropriate, by, for example, (i) an amount of cash and
cash equivalents, equal to the market value of the futures contracts purchased
or sold and options written thereon (less any related margin deposits),
deposited in a segregated account with its custodian or (ii) by owning the
instruments underlying the futures contract sold (i.e., short futures positions)
or option written thereon or by holding a separate option permitting the Fund to
purchase or sell the same futures contract or option at the same strike price or
better. At no time may any of the Funds engage in futures contracts if the total
contract value of the futures contracts would exceed 20% of the Fund's total
assets.
Positions in futures contracts may be closed but only on an exchange or a
board of trade which provides the market for such futures. Although the Funds
intend to purchase or sell futures only on exchanges or boards of trade where
there appears to be an active market, there is no guarantee that such will exist
for any particular contract or at any particular time. If there is not a liquid
market at a particular time, it may not be possible to close
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a futures position at such time, and, in the event of adverse price movements, a
Fund would continue to be required to make daily cash payments of variation
margin. Consequently, where a liquid secondary market does not exist, the Fund
will be unable to control losses from such futures contracts by closing out its
positions.
"WHEN-ISSUED" AND "DELAYED DELIVERY SECURITIES" AND "FORWARD COMMITMENTS". The
Government Securities Fund, the Tax-Exempt Fund and Global Income Fund may
make contracts to buy securities for a fixed price at a future date beyond
customary settlement time. When such transactions are negotiated, the price is
fixed at the time of commitment but delivery and payment for the securities can
take place up to three months after the date of commitment to purchase. Such
agreements involve a risk of loss if the value of the security to be purchased
declines prior to the settlement date, which risk is in addition to the risk of
decline in value of the Government Securities Fund, Tax-Exempt Fund or Global
Income Fund's other assets. Where such purchases are made through dealers, the
Fund relies on the dealer to consummate the sale. The dealer's failure to do so
may result in the loss to the Fund of an advantageous yield or price. Although
the Fund will generally enter into forward commitments with the intention of
acquiring securities for its portfolio or for delivery pursuant to options
contracts it has entered into, the Fund may dispose of a commitment prior to
settlement if the Investment Manager deems it appropriate to do so. The Fund
holds, and maintains until the settlement date in a segregated account, cash or
high-grade debt obligations in an amount sufficient to meet the purchase price
of its total commitments for forward commitment securities. The Fund may realize
short-term profits or losses upon the sale of such forward commitment contracts.
FOREIGN SECURITIES. Subject to the Money Market Fund's quality and maturity
standards, the Money Market Fund may invest up to 10% of the Fund's total assets
in United States dollar-denominated securities of foreign issuers and in the
securities of foreign branches of United States banks, such as negotiable
certificates of deposit (Eurodollars). The Money Market Fund's investment in
securities of foreign issuers involves certain risks that are different than an
investment in only debt obligations of United States domestic issuers. These
risks are discussed below.
The Growth and Income Fund, the Total Return Fund and the Capital Appreciation
Fund may invest in and hold securities of foreign issuers in an amount, which
together with investments in American Depositary Receipts ("ADRs") European
Depositary Receipts ("EDRs") and Global Depositary Receipts ("GDRs") will not
exceed 20% of the Fund's total assets. The Global Income Fund has an unlimited
right to invest and hold foreign securities. For purposes hereof, securities of
foreign issuers means securities of issuers organized or whose principal place
of business is outside the United States, or whose securities are principally
traded in securities markets outside the United States.
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Investment in foreign securities may involve the following special
considerations: with respect to foreign denominated securities, the risk of
fluctuating exchange rates; restrictions on and costs associated with the
exchange of currencies; the fact that foreign securities and markets are not as
liquid as their domestic counterparts; the imposition of exchange control
restrictions; and the possibility of economic or political instability. Also,
issuers of foreign securities are subject to different and, in some cases, less
comprehensive and non-uniform accounting, reporting and disclosure requirements
than domestic issuers, and settlement of transactions with respect to foreign
securities may be sometimes delayed beyond periods customary in the United
States. Foreign securities also generally have higher brokerage and custodial
costs than those of domestic securities. As a result, the selection of
investments in foreign issues may be more difficult and subject to greater risks
than investments in domestic issues. Since the Growth and Income Fund, the Total
Return Fund, the Capital Appreciation Fund and the Global Income Fund may invest
in businesses located in foreign nations, there is the possibility of
expropriation or confiscatory taxation, political or social instability or
diplomatic developments which could affect investments in those nations and
there may be more difficulty in obtaining and enforcing a court judgment abroad.
The Investment Manager will consider these and other factors before investing
in particular securities of foreign issuers and will not make such investments
unless, in its opinion, such investments will comply with the policies and meet
the objectives of the Money Market Fund, the Growth and Income Fund, the Total
Return Fund, the Capital Appreciation Fund and the Global Income Fund. Also, the
Board of Directors will monitor all foreign custody arrangements to ensure
compliance with the 1940 Act and the rules thereunder, and will review and
approve, at least annually, the continuance of such arrangements as is
consistent with the best interests of the Company and its shareholders.
DEPOSITARY RECEIPTS. The Growth and Income Fund, the Total Return Fund, the
Capital Appreciation Fund and the Global Income Fund may invest in "ADRs,"
"GDRs," and EDRs",(collectively "Depositary Receipts") which, with the exception
of the Global Income Fund, together with investment in securities of foreign
issuers, will not exceed 20% of the Fund's total assets. ADRs are certificates
issued by a United States bank representing the right to receive securities of a
foreign issuer deposited in a foreign branch of a United States bank and traded
on a United States exchange or over-the-counter. There are no fees imposed on
the purchase or sale of ADRs when purchased from the issuing bank in the initial
underwriting, although the issuing bank may impose charges for the collection of
dividends and the conversion of ADRs into the underlying ordinary shares.
Brokerage commissions will be incurred if ADRs are purchased through brokers on
the domestic stock exchanges. Investments in ADRs have advantages over direct
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investments in the underlying foreign securities, including the following: they
are more liquid investments, they are United States dollar-denominated, they are
easily transferable, and market quotations for such securities are readily
available. The risks associated with ownership of Depositary Receipts are the
same as those associated with investments in foreign securities except there is
no currency risk.
MORTGAGE-RELATED SECURITIES. Government National Mortgage Association ("GNMA")
certificates are mortgage pass-through securities representing part ownership of
a pool of mortgage loans. These loans, issued by lenders such as mortgage
bankers, commercial banks, and savings and loan associations, are either insured
by the Federal Housing Administration or guaranteed by the Veterans
Administration. A "pool" or group of such mortgages is assembled and, after
being approved by GNMA, is offered to investors through securities dealers. Once
approved by GNMA, the timely payment of interest and principal on each mortgage
is guaranteed by GNMA and backed by the full faith and credit of the United
States Treasury. GNMA certificates differ from bonds in that principal is paid
back monthly by the borrower over the term of the loan rather than returned in a
lump sum at maturity. GNMA certificates are called "pass-through" securities
because both interest and principal payments (including prepayments) are passed
through to the holder of the certificate.
In addition to GNMA certificates, the Government Securities Fund and Global
Income Fund may invest in mortgage pass-through securities issued by Federal
National Mortgage Association ("FNMA") and by Federal Home Loan Mortgage
Corporation ("FHLMC"). FNMA, a federally chartered and privately-owned
corporation, issues mortgage-backed pass-through securities which are guaranteed
as to timely payment of principal and interest by FNMA. FHLMC, a corporate
instrumentality of the United States whose stock is owned by the Federal Home
Loan Banks, issues two types of pass-through securities: mortgage participation
certificates ("PCs") and guaranteed mortgage certificates ("GMCs"). Both PCs and
GMCs represent an undivided interest in a pool of conventional mortgages from
FHLMC's portfolio. With respect to PCs, FHLMC guarantees the timely payment of
interest and the ultimate collection of principal. With respect to GMCs, FHLMC
guarantees that these securities will pay interest semi-annually and return
principal annually in a guaranteed minimum amount. Securities guaranteed by FNMA
and FHLMC are not backed by the full faith and credit of the United States
Treasury. If either fixed or variable rate pass-through securities issued by the
United States Government or its agencies or instrumentalities are developed in
the future, the Funds reserve the right to invest in them.
The Government Securities Fund and the Global Income Fund may also invest in
other types of mortgage-related securities issued by governmental entities.
These other instruments include
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collateralized mortgage obligations ("CMOs"),mortgage-backed bonds and real
estate mortgage investment conduits ("REMICs"). However, the Government
Securities Fund and the Global Income Fund will not invest in residual interests
of REMICs or CMOs due to the volatile nature of such instruments. CMOs are
obligations fully collateralized directly or indirectly by a pool of mortgages
on which payment of principal and interest are passed through to the holders of
CMOs on the same schedule as they are received, although not necessarily on a
pro rata basis.
Mortgage-backed bonds are direct obligations of their issuers, payable out of
the issuers' general funds and fully collateralized directly or indirectly by a
pool of mortgage loans. The mortgages serve as collateral for the issuer's
payment obligations on the mortgage-backed bonds, but interest and principal
payments on the mortgages are not passed through directly (as with GNMA
certificates and FNMA and FHLMC pass-through securities) or on a modified basis
(as with CMOs). Accordingly, a change in the rate of prepayments on the pool of
mortgages could change the effective maturity of a CMO but not the effective
maturity of a mortgage-backed bond (although, like many bonds, mortgage-backed
bonds may be callable by the issuer prior to maturity).
REMICs were created through provisions in the Tax Reform Act of 1986 in order
to clarify certain ambiguities concerning the tax treatment of mortgage related
securities. A REMIC is an entity that holds a fixed pool of mortgages and issues
multiple classes of interests. If an issuer elects to come under the REMIC
provisions, its sale of "REMIC securities" will be treated as the sale of the
mortgages for tax purposes, regardless of whether such securities are issued in
the form of pass-throughs or collateralized debt and regardless of the financial
accounting treatment used. Investors in REMICs may purchase two types of REMIC
securities: (i) "regular interests", which have the characteristics of pass-
throughs or CMOs (i.e., fixed interest and principal), or (ii) "residual
interests", the value of which are affected by mortgage prepayments or other
contingencies. Again, the Government Securities Fund and Global Income Fund will
not invest in any residual interests of REMICs or CMOs.
In reliance on an SEC interpretation of the Investment Company Act, the
Company's investments in certain qualifying CMOs, including CMOs that have
elected to be treated as REMICs, are not subject to the Investment Company Act's
limitation on acquiring interests in other investment companies. In order to be
able to rely on the SEC's interpretation, the CMOs and REMICs must be unmanaged,
fixed-asset issuers that (i) invest primarily in mortgage-related securities,
(ii) do not issue redeemable securities, (iii) operate under general exemptive
orders exempting them from all provisions of the Investment Company Act, and
(iv) are not registered or regulated under the Investment Company Act as
investment companies. To the extent that a Fund selects CMOs or REMICs that do
not meet
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the above requirements, the Fund may not invest more than 10% of its assets in
all such entities and may not acquire more than 3% of the voting securities of
any single such entity.
Prepayment of mortgages underlying mortgage-backed securities may reduce their
current yield and total return. Mortgage-related securities may not be an
effective means of "locking-in" long-term interest rates because of the need to
invest and reinvest scheduled and unscheduled principal payments. At the time
principal payments or prepayments are received by the Fund and reinvested,
prevailing interest rates may be higher or lower than the Fund's current yield.
However, the Investment Manager intends to invest in these securities only when
the potential benefits to a Fund are deemed to outweigh the risks. Like other
bond investments, the value of mortgage-related securities will tend to rise
when interest rates fall, and fall when rates rise. Their value may also change
because of changes in the market's perception of the creditworthiness of the
organization that issued or guaranteed them or changes in the value of the
underlying mortgages. In addition, the mortgage securities market in general may
be adversely affected by changes in governmental regulation or tax policies.
WARRANTS. All the Funds except the Money Market Fund may invest in warrants,
which are rights to buy certain securities at set prices during specified time
periods. If, prior to the expiration date, the Fund is not able to exercise a
warrant at a cost lower than the underlying securities, the Fund will suffer a
loss of its entire investment in the warrant. See investment restriction 19 for
additional limitations on the use of warrants.
INVESTMENT COMPANIES. All the Funds may, subject to their respective Investment
Restrictions, under certain circumstances acquire the securities of other open-
end and closed-end investment companies. Such investments often result in
duplicate fees and expenses.
DESCRIPTION OF INVESTMENT RATINGS
MOODY'S - BOND RATINGS
Aaa - Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt-edge". Interest payments are protected by a large, or by an exceptionally
stable, margin and principal is secure. While the various protective elements
are likely to change, such changes as can be visualized are not likely to impair
the fundamentally strong position of such issues.
Aa - Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group, they comprise what are generally known
as high-grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in
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Aaa securities, fluctuation of protective elements may be of greater amplitude,
or there may be other elements present which make the long-term risks appear
somewhat larger than in Aaa securities.
A - Bonds which are rated A possess many favorable investment attributes and
are to be considered as upper medium-grade obligations. Factors giving security
to principal and interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment sometime in the future.
Baa - Bonds which are rated Baa are considered as medium-grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest payments
and principal security appear adequate for the present, but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and, in
fact, have speculative characteristics as well.
RATING REFINEMENTS. Moody's may apply numerical modifiers, 1, 2 and 3, in each
generic rating classification from Aa through B in its municipal bond rating
system. The modifier 1 indicates that the security ranks in the higher end of
its generic category; the modifier 2 indicates a mid-range ranking; and a
modifier 3 indicates that the issue ranks in the lower end of its generic rating
category.
SHORT-TERM NOTES. The four ratings of Moody's for short-term notes are MIG 1,
MIG 2, MIG 3 and MIG 4. MIG 1 denotes "best quality, enjoying strong protection
from established cash flows." MIG 2 denotes "high quality" with "ample margins
of protection." MIG 3 notes are of "favorable quality...but lacking the
undeniable strength of the preceding grades." MIG 4 notes are of "adequate
quality, carrying specific risk but having protection...and not distinctly or
predominantly speculative."
MOODY'S COMMERCIAL PAPER RATINGS
Moody's commercial paper ratings are opinions of the ability of issuers to
repay punctually promissory obligations not having an original maturity in
excess of 9 months. Moody's employs the following three designations, all judged
to be investment grade, to indicate the relative repayment capacity of rated
issuers:
Issuers rated Prime-1 (or related supporting institutions) have a superior
capacity for repayment of short-term promissory obligations.
Issuers rated Prime-2 (or related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations.
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Issuers rated Prime-3 (or related supporting institutions) have an acceptable
capacity for repayment of short-term promissory obligations.
Issuers rated Not Prime do not fall within any of the Prime rating categories.
STANDARD & POOR'S - BOND RATINGS
A Standard & Poor's municipal debt rating is a current assessment of the
creditworthiness of an obligor with respect to a specific obligation. This
assessment may take into consideration obligors such as guarantors, insurers or
lessees.
The debt rating is not a recommendation to purchase, sell or hold a security,
inasmuch as it does not comment as to market price or suitability for a
particular investor.
The ratings are based on current information furnished by the issuer or
obtained by Standard & Poor's from sources Standard & Poor's considers reliable.
Standard & Poor's does not perform an audit in connection with any rating and
may, on occasion, rely on unaudited financial information. The ratings may be
changed, suspended, or withdrawn as a result of changes in, or unavailability
of, such information, or for other reasons.
The ratings are based, in varying degrees, on the following considerations:
I. Likelihood of default-capacity and willingness of the obligor as to the
timely payment of interest and repayment of principal in accordance
with the terms of the obligations.
II. Nature of and provisions of the obligations.
III. Protection afforded by, and relative position of, the obligations in
the event of bankruptcy, reorganization, or other arrangement under the
laws of bankruptcy and other laws affecting creditor's rights.
AAA. Debt rated "AAA" has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.
AA. Debt rated "AA" has a very strong capacity to pay interest and repay
principal and differs from the highest-rated issues only in small
degree.
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A. Debt rated "A" has a strong capacity to pay interest and repay
principal although they are somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than debt
in higher-rated categories.
BBB. Debt rated "BBB" is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate
protection parameters, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity to pay
interest and repay principal for debt in this category than for debt in
higher-rated categories.
Plus (+) or Minus (-): The ratings from "AA" to "BBB" may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.
STANDARD & POOR'S COMMERCIAL PAPER RATINGS
A Standard & Poor's commercial paper rating is a current assessment of the
likelihood of timely payment of debt having an original maturity of no more than
365 days. Ratings are graded into four categories, ranging from "A" for the
highest quality obligations to "D" for the lowest. Ratings are applicable to
both taxable and tax-exempt commercial paper. The four categories are as
follows:
A. Issues assigned this highest rating are regarded as having the greatest
capacity for timely payment. Issues in this category are further
refined with the designation 1, 2, and 3 to indicate the relative
degree of safety.
A-1. This designation indicates that the degree of safety regarding timely
payment is very strong.
A-2. Capacity for timely payment on issues with this designation is strong.
However, the relative degree of safety is not as overwhelming as for
issues designated "A-1".
A-3. Issues carrying this designation have a satisfactory capacity or timely
payment. They are, however, somewhat more vulnerable to the adverse
effects of changes in circumstances than obligations carrying the
higher designations.
The Commercial Paper Rating is not a recommendation to purchase or sell a
security. The ratings are based on current information furnished to Standard &
Poor's by the issuer and obtained by Standard & Poor's from other sources it
considers reliable. The ratings may be changed, suspended, or withdrawn as a
result of changes in, or unavailability of, such information.
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Standard & Poor's rating categories with respect to certain municipal note
issues with a maturity of less than 3 years are as follows:
SP-1. A very strong, or strong, capacity to pay principal and interest.
Issues that possess overwhelming safety characteristics will be given a
"+" designation.
SP-2. A satisfactory capacity to pay principal and interest.
SP-3. A speculative capacity to pay principal and interest. Standard & Poor's
may continue to rate note issues with a maturity greater than 3 years
in accordance with the same rating scale currently employed for
municipal bond ratings.
INVESTMENT ADVISORY AND OTHER SERVICES
INVESTMENT MANAGEMENT
The Company has entered into an Investment Management Agreement with respect to
each Fund with Chubb Investment Advisory Corporation (the "Investment
Administrator") and Chubb Asset Managers, Inc. (the "Investment Manager"). The
agreement for the Money Market Fund, Government Securities Fund, Total Return
Fund, Tax-Exempt Fund, and Growth and Income Fund was approved by a majority of
the shareholders of the appropriate Fund at the meeting of shareholders held
April 21, 1988. The agreements for the Capital Appreciation Fund and Global
Income Fund were approved by the appropriate Fund at a meeting of shareholders
held August 31, 1995. The term of each agreement is one year, but will continue
in effect from year to year if approved at least annually by a vote of a
majority of the Board of Directors of the Company (including a majority of the
directors who are not parties to the contract or interested persons of any such
parties) cast in person at a meeting called for the purpose of voting on such
renewal, or by the vote of a majority of the outstanding shares of a Fund. The
agreements may be terminated, without the payment of any penalty, by any party,
by the vote of the Board of Directors, or by vote of a majority of the
outstanding shares of a Fund, on 60 days written notice to the Investment
Manager and Investment Administrator of the Company, or automatically in the
event of an assignment.
Under the terms of the agreements, the Investment Manager, subject to review
by the Company's Board of Directors, will have the day-to-day responsibility for
making decisions to buy, sell, or hold any particular security for all the
Funds. See "MANAGEMENT OF THE COMPANY" in the Prospectus. The Investment
Administrator, subject to review by the Company's Board of Directors, will act
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primarily as administrator of the Company. The Investment Administrator is also
responsible for reviewing the investment transactions as executed by broker-
dealers for each Fund.
For providing investment advisory, management, and administrative services to
the Fund, the Investment Administrator and Investment Manager are entitled to
receive monthly compensation based on a percentage of the average net asset
value of each Fund as described more fully under "MANAGEMENT FEES AND EXPENSES"
in the Prospectus. For the years ended December 31, 1993, December 31, 1994, and
December 31, 1995 no such fees were paid to the Investment Manager. For the year
ended December 31, 1993 the Company paid $7,060, $28,249, $29,927, $32,681 and
$29,323 to the Investment Administrator for the Money Market Fund, the
Government Securities Fund, the Total Return Fund, the Tax Exempt Fund and the
Growth and Income Fund, respectively. For the year ended December 31, 1994 the
Company paid $9,356, $34,215, $41,974, $39,057 and $46,851 to the Investment
Administrator for the Money Market Fund, the Government Securities Fund, the
Total Return Fund, the Tax Exempt Fund and the Growth and Income Fund,
respectively. For the year ended December 31, 1995, the Company paid $11,436,
$33,954, $49,091, $36,807, $61,946, $1,021 and $12,003 to the Investment
Administrator for the Money Market Fund, the Government Securities Fund, the
Total Return Fund, the Tax-Exempt Fund, the Growth and Income Fund, Capital
Appreciation Fund and Global Income Fund, respectively.
The Company will bear certain additional expenses, the amount of which will be
limited in compliance with the most restrictive applicable state Blue Sky laws
to no more than an annual rate of 2.5% of each Fund's first $30 million of
average daily net assets, 2.0% of the next $70 million of each Fund's average
daily net assets and 1.5% of each Fund's remaining average daily net assets.
Expenses in excess of this limitation, if any, will be borne by Chubb Life.
Pursuant to a written agreement dated as of January 25, 1991 ("Expense
Limitation Agreement") between the Company, the Investment Manager, the
Investment Administrator, Chubb Securities Corporation (the "Distributor") and
Chubb Life, the Investment Manager has agreed to waive its investment management
fees for the current fiscal year. The Distributor has agreed to waive a portion
of the fees payable under the Distribution Plan for the year ended December 31,
1996 [See "Management fees and Expenses" in the Prospectus.] The Investment
Administrator, pursuant to the Expense Limitation Agreement, had accepted for
the year ended December 31, 1995 a reduced fee of 0.25% of the average daily net
assets of each Fund except the Money Market Fund and the Global Income Fund and
a reduced fee of 0.15% and 0.45% of the average daily net assets of the Money
Market Fund and the Global Income Fund, respectively. In addition, for the year
ended December 31, 1995, and pursuant to the Expense Limitation Agreement, Chubb
Life agreed to assume all expenses of the Company in excess of an annual rate of
1.08% of the average daily net assets of the Total Return Fund, and the Growth
and Income Fund, 1.00% of the average daily net assets of the Government
Securities Fund and the Tax-Exempt Fund, and 0.50% of the average daily net
assets of the Money Market Fund, 1.25% of the average daily net assets of the
Capital Appreciation Fund, and 1.75 of the average daily net assets of the
Global Income Fund, and, in its discretion, may assume a greater percentage of
expenses.
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For the year ended December 31, 1996, pursuant to the Expense Limitation
Agreement, Chubb Life has agreed to assume all expenses of the Company in excess
of an annual rate of 1.75% of the average daily assets of the Global Income
Fund, 1.25% of the average daily net assets of the Total Return Fund, the Growth
and Income Fund, and Capital Appreciation Fund, 1.00% of the average daily net
assets of the Government Securities Fund and the Tax-Exempt Fund, and 0.50% of
the average daily net assets of the Money Market Fund, and, in its discretion,
may assume a greater percentage of expenses.
The Investment Manager and its affiliates may provide investment advice to
other clients, including, but not limited to, mutual funds, individuals, pension
funds and institutional investors. In addition, persons employed by the
Investment Manager, who are also investment personnel of Chubb & Son, Inc.,
currently provide investment advice to and supervision and monitoring of
investment portfolios for The Chubb Corporation and its affiliates, including
general accounts of the insurance affiliates of The Chubb Corporation. In
addition, certain investment personnel employed by the Investment Manager
currently provide advice to other investment portfolios of entities not
affiliated with The Chubb Corporation or its affiliates in their capacity as
officers or directors of certain registered investment advisers not related to
the Investment Manager. Some of these investment portfolios, as well as the
portfolios of other clients, may have investment objectives and investment
programs similar to the Funds. Accordingly, occasions may arise when the
Investment Manager and investment personnel of Chubb & Son, Inc. may select
securities for purchase or sale by a Fund that are also held by other advisory
accounts, or that are currently being purchased or sold for other advisory
accounts. It is the practice of the Investment Manager and its investment
personnel, its affiliates, and the investment personnel of Chubb & Son, Inc. to
allocate such purchases or sales insofar as feasible, among their advisory
clients in a manner they deem equitable. It is the policy of the Investment
Manager, its affiliates and the Investment personnel of Chubb & Son, Inc. not to
favor any one account over the other.
On those occasions when such simultaneous investment decisions are made, the
Investment Manager, its affiliates, and the investment personnel of Chubb & Son,
Inc. will allocate purchase and sale transactions in an equitable manner
according to written procedures approved by the Company's Board of Directors.
Specifically, such written procedures provide that, in allocating purchase and
sale transactions made on a combined basis, the Investment Manager, its
affiliates, and the investment personnel of Chubb & Son, Inc. will seek to
achieve the same average unit price of securities for each advisory account and
will seek to allocate, as nearly as practicable, such transactions on a pro-rata
basis substantially in proportion to the amounts ordered to be purchased or sold
by each advisory account. Such procedures may, in certain instances, be
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either advantageous or disadvantageous to the Funds. While it is conceivable
that in certain instances this procedure could adversely affect the price or
number of shares involved in the Company's transaction, it is believed that the
procedure generally contributes to better overall execution of the Company's
portfolio transactions.
TRANSFER AGENT
The Company has contracted with Firstar Trust Company ("Firstar") to act as its
transfer agent, registrar, and dividend disbursing agent. Firstar will service
shareholder accounts, and its duties will include: (i) effecting sales
redemptions and exchanges of Company shares; (ii) distributing dividends and
capital gains associated with Company accounts; and (iii) maintaining account
records and responding to shareholder inquiries.
Firstar is compensated monthly by the Company at the following annual rates per
shareholder account: $19.00 for the Money Market Fund, $16.00 for the Government
Securities Fund and the Tax-Exempt Fund, $14.00 for the Total Return Fund, and
$14.00 for the Growth and Income Fund $14.00 for the Capital Appreciation Fund
and $14.00 for the Global Income Fund, in addition to ACH fees, IRA fees, wire
fees and out of pocket expenses. There is a minimum annual fee of $24,000 for
the Money Market Fund and $10,000 for the other Funds. The fees paid to the Fund
transfer agent(s) for the year ended December 31, 1995 were $208,235.
INDEPENDENT AUDITORS
Ernst & Young LLP, 200 Clarendon Street, Boston, Massachusetts 02116 has been
selected as the independent auditors of the Company. The financial statements of
the Fund are incorporated by reference in this Statement of Additional
Information and the related financial highlights included in the Prospectus for
the periods indicated therein have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report thereon incorporated by
reference, and are included in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
CUSTODIANS
Citibank, N.A., 111 Wall Street, New York City, New York 10043, acts as
custodian of the Company's assets. Citibank is responsible for holding all
securities and cash of each Fund, receiving and paying for securities purchased,
delivering against payment securities sold, receiving and collecting income from
investments, making all payments covering expenses of the Company and performing
other administrative duties, all as directed by persons authorized by the
Company. Citibank does not exercise any supervisory function in such matters as
the purchase and sale of portfolio securities, payment of dividends, or payment
of expenses of the
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Company. The Company, with respect to each Fund, may also appoint from time to
time, with the approval of the Company's Board of Directors, qualified domestic
sub-custodians for all the Funds and foreign sub-custodians qualified under Rule
17f-5 of the 1940 Act with respect to certain foreign securities which may be
purchased by the Funds.
MANAGEMENT OF THE COMPANY
The directors and officers of the Fund, their addresses, their positions with
the Fund, and their principal occupations for the past five years are set forth
below:
<TABLE>
<CAPTION>
Positions
with Occupations for
Name and Address the Company the Past Five Years
- ---------------- ----------- -------------------
<S> <C> <C>
Michael O'Reilly* President and Senior Vice President and Chief
15 Mountain View Rd Director Investment Officer of The Chubb
Warren, New Jersey 07061 Corporation, Director, President
and Chief Operating Officer of the
Investment Manager and Senior
Vice President and Director of the
Investment Administrator.
Ronald R. Angarella Senior Vice Senior Vice President, Chubb Life;
President President and Director, Chubb
and Director America Fund, Inc., the Investment
Administrator, Chairman, the
Distributor, Hampshire Funding, Inc.,
and Chubb Series Trust.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Positions
with Principal Occupations for
Name and Address the Company the Past Five Years
- ---------------- ----------- -------------------
<S> <C> <C>
Charles C. Cornelio Vice President Senior Vice President, Chief
One Granite Place and General Administrative Officer, Counsel
Concord, N.H. 03301 Counsel and Assistant Secretary, Chubb
Life; Vice President, General
Counsel and Secretary, Chubb
Securities Corporation and
Hampshire Funding, Inc.; Vice
President and General Counsel,
Chubb America Fund, Inc. and
Chubb Series Trust; Vice President
and Secretary, Chubb Investment
Advisory.
Shari J. Lease Secretary Assistant Vice President and
One Granite Place Counsel, Chubb Life; Secretary,
Concord, N.H. 03301 Chubb Investment Funds, Inc.;
Assistant Secretary, Chubb
Investment Advisory, previously
Assistant Counsel and Assistant
Vice President, State Bond and
Mortgage Company and affiliated
companies.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Positions
with Principal Occupations for
Name and Address the Company the Past Five Years
- ---------------- ----------- -------------------
<S> <C> <C>
John A. Weston Treasurer Assistant Vice President of
One Granite Place ChubbLife; Treasurer of Chubb
Concord, N.H. 03301 Securities Corporation, Chubb
Investment Advisory,
Hampshire Funding, Inc., Chubb America
Fund, Inc., and Chubb Series Trust;
formerly, Mutual Fund Accounting
Officer for the Fund, Chubb
Investment Funds, Inc. and Chubb
Investment Advisory Corporation
and Assistant Treasurer for Chubb
Securities Corporation and
Hampshire Funding, Inc.
Thomas H. Elwood Assistant Assistant Counsel, Chubb Life
One Granite Place Secretary Assistant Secretary, Chubb
Concord, N.H. 03301 Investment Funds, Inc., Chubb
Series Trust; formerly, Associate
Counsel, New York Life Insurance
Company; Secretary New York
Life Institutional Funds, Inc.,
Assistant Secretary, Mainstay
Funds, and MFA Funds.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Positions
with Principal Occupations for
Name and Address the Company the Past Five Years
- ---------------- ----------- -------------------
<S> <C> <C>
Mark D. Landry Assistant Mutual Fund Accounting and Operations
One Granite Place Treasurer Officer, ChubbLife; Assistant
Concord, N.H. 03301 Treasurer Chubb Investment
Advisory; Chubb America Fund, Inc.,
Chubb Series Trust; formerly Mutual Fund
Accounting and Operations Manager, Chubb
Life, Senior Fund Accountant for the Fund
and Chubb America Fund, Inc.
James J. Weisbart Director Retired, previously President of
301 Smithfield Road Bird Bath Laundromats and
Contoocook, N.H. 03329 President of Solomon's Inc. (retail
clothing company)
Michael D. Coughlin Director President of Concord Litho
106 School Street Company, Inc. (printing company)
Concord, N.H. 03301
Elizabeth S. Hager Director Consultant, Fund Development;
5 Auburn Street previously, State Representative,
Concord, N.H. 03301 New Hampshire, City Councilor,
City of Concord, N.H. and Mayor,
City of Concord, N.H.
</TABLE>
** Asterisks indicate those directors who are "interested persons" within the
meaning of Section 2(a)(19) of the 1940 Act.
Mr. O'Reilly and Mr. Angarella are members of the Company's Executive Committee
and Valuation Committee, and Mr. Weisbart, Mr. Coughlin, and Ms. Hager are
members of the Company's Audit Committee.
The Company pays no salaries or compensation to any of its officers, all of
whom are officers or employees of the Investment Administrator or Investment
Manager. The Company pays to each director who is not affiliated with the
Investment Manager or
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<PAGE>
Investment Administrator or their affiliates an annual director's retainer of
$2,000 and a payment of $250 plus expenses per meeting attended.
As of February 29, 1996, the directors and officers of the Company, as a group,
owned .31% of the outstanding shares of the Company and less than 1% of any of
the Funds individually.
PORTFOLIO TRANSACTIONS AND BROKERAGE ALLOCATIONS
Under the Investment Management Agreement, the Investment Manager has the day-
to-day responsibility for selecting broker-dealers through which securities are
to be purchased and sold. The Investment Administrator has the responsibility to
review the investment transactions as executed by the broker-dealers.
The money market securities and other debt securities purchased by the Money
Market Fund, the Government Securities Fund, and the Tax-Exempt Fund usually
will be purchased on a principal basis directly from issuers, underwriters, or
dealers. Accordingly, no brokerage charges are expected to be paid on such
transactions. However, purchases from an underwriter on a principal basis
generally include a concession paid to the underwriter, and transactions with a
dealer usually include the dealer's "mark-up" or "mark-down".
Insofar as known to management, no director or officer of the Company, of the
Investment Manager, or the Investment Administrator or any person affiliated
with any of them has any material direct or indirect interest in any broker
employed by or on behalf of the Company except as officers or directors of the
Distributor.
In selecting broker-dealers to execute transactions with respect to each Fund,
the Investment Manager is obligated to use its best efforts to obtain for each
Fund the most favorable overall price and execution available, considering all
the circumstances. Such circumstances include the price of the security, the
size of the broker-dealer's "spread" or commission, the willingness of the
broker-dealer to position the trade, the reliability, financial strength and
stability and operational capabilities of the broker-dealer, the ability to
effect the transaction at all where a large block is involved, availability of
the broker-dealer to stand ready to execute possibly difficult transactions in
the future, and past experience as to qualified broker-dealers. Such
considerations are judgmental and are weighed by the Investment Manager in
seeking the most favorable overall economic result to the Company.
Subject to the foregoing standards, the Investment Manager has been authorized
by the Company's Board of Directors to allocate brokerage to broker-dealers who
have provided brokerage and research services, as such services are defined in
Section 28(e) of
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<PAGE>
the Securities Exchange Act of 1934. Pursuant to that authorization, the
Investment Manager may cause each Fund to pay any broker-dealer a commission in
excess of the amount another broker-dealer would have charged for effecting the
same transaction if the Investment Manager determines in good faith that such
amount of commission is reasonable in relation to the value of the brokerage an
research services provided by such broker-dealer to the Investment Manager,
viewed in terms of either that particular transaction or the Investment
Manager's overall responsibilities with respect to the Company and other
accounts as to which it exercises investment discretion. Such brokerage and
research services may include, among other things, analyses and reports
concerning issuers, industries, securities, economic factors and trends, and
strategies for the Funds. Such research services may be used by the Investment
Manager in connection with any other advisory accounts managed by it.
Conversely, research services to any other advisory accounts may be used by the
Investment Manager in managing the investments of the Company.
During the year ended December 31, 1995 the Fund paid no commissions to an
affiliated broker/dealer and no commissions were contingent upon the sale of
Fund shares. As of December 31, 1995, the Total Return Fund and the Growth and
Income Fund held the following shares of their regular brokers: 7,900 and 11,200
shares respectively of Merrill Lynch & Company, Inc. and 18,450 and 34,850
shares respectively of Paine Webber Group, Inc.
The Investment Manager will use its best efforts to recapture all available
tender offer solicitation fees and similar payments in connection with tenders
of the securities of the Company and to advise the Company of any fees or
payments of whatever type which it may be possible to obtain for the Company's
benefit in connection with the purchase or sale of the Company's securities.
As discussed above, the Investment Manager may combine transactions for the
Company with transactions for other accounts managed by it, its affiliates, or
investment personnel of Chubb & Son, Inc., including other investment companies
under the 1940 Act. Transactions will be combined only when the transaction
meets the Company's requirements as to selection of brokers or dealers and
negotiation of prices and commissions which the Investment Manager would
otherwise apply.
For the year ended December 31, 1993, the Company paid in the aggregate $96,200,
as brokerage commissions. For the year ended December 31, 1994, it paid $67,358,
$33,679 which was paid for research services received. For the year ended
December 31, 1995, it paid $83,044, $59,792 of which was paid for research
services received. The increase in brokerage commissions paid over the past two
years is due to increased trading volume of equities by the Company.
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<PAGE>
Portfolio turnover for each Fund can vary significantly from year to year or
within a year. The Government Securities Fund's turnover rate was 276.56% for
1995, compared to 113.36% for 1994. This represents an increase from year to
year, the 1995 turnover rate may still be considered high due to the following
factors: (i) the need to restructure the portfolio due to changing market and/or
economic conditions; (ii) The need to rebalance the portfolio as securities age
down the yield curve; (iii) the need to trade securities whose characteristics
are affected by moderate to large changes in interest rates (mortgage-backed
securities); and (iv) value added to trading opportunities.
CAPITAL STOCK
The authorized capital stock of the Company consists of 1,000,000,000 shares
of common stock, par value $.01, which are divided into Seven series: Chubb
Money Market Fund, Chubb Government Securities Fund, Chubb Total Return Fund,
Chubb Tax-Exempt Fund, Chubb Growth and Income Fund, Chubb Capital Appreciation
Fund and Chubb Global Income Fund. Each Fund currently consists of 100,000,000
authorized shares. The Company has the right to issue additional shares without
the consent of the shareholders, and may allocate its issued and reissued shares
to new Funds or to one or more of the seven existing Funds.
The assets received by the Company for the issuance or sale of shares of each
Fund and all income, earnings, profits and proceeds thereof are specifically
allocated to each Fund. They constitute the underlying assets of each Fund, are
required to be segregated on the books of account, and are to be charged with
the expense of such Fund. Any assets which are not clearly allocable to a
particular Fund are allocated among the Funds in proportion to their relative
net assets before adjustment for such unallocated liabilities. Each issued and
outstanding share in a Fund is entitled to participate equally in dividends and
distributions declared with respect to such Fund and in the net assets of such
Fund upon liquidation or dissolution remaining after satisfaction of outstanding
liabilities.
Chubb Life Insurance Company of New Hampshire provided the initial capital for
the Company by purchasing shares of each of the original five Funds valued at
$100,000 prior to the date shares of the Company were offered to the public. On
July 1, 1991, Chubb Life Insurance Company of New Hampshire and Chubb Life
Insurance Company of America were merged into an affiliate, The Volunteer State
Life Insurance Company ("Volunteer"), which simultaneously changed its name to
Chubb Life Insurance Company of America ("Chubb Life"). Chubb Life provided the
initial investment for the Capital Appreciation Fund and the Global Income Fund
by purchasing 10,000 shares of each Fund at a cost of $10.00 per share. Chubb
Life intends to withdraw such investment from time to time. As of February 29,
1996, Chubb Life (a New Hampshire corporation), The Chubb
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<PAGE>
Corporation (a New Jersey corporation), and its wholly-owned subsidiary, Federal
Insurance Company ("Federal Insurance"), together owned 21% of the outstanding
shares of the Company.
DISTRIBUTION OF THE COMPANY'S SHARES
PRINCIPAL UNDERWRITER
Chubb Securities Corporation, One Granite Place, Concord, New Hampshire 03301,
(603) 226-5000, is the principal underwriter and Distributor of the Company's
shares, and is a wholly-owned subsidiary of Chubb Life.
Under the terms of the Distribution Agreement, the Distributor will use its
best efforts to distribute the Company's shares among investors and broker-
dealers with which it has contracted to sell the Company's shares. The shares
are sold only at the public offering price in effect at the time of the sale
("Offering Price"), which is determined in the manner set forth in the
Prospectus under "PURCHASE OF SHARES". The Company will receive not less than
the full net asset value of the shares of each Fund sold, which amount is
determined in the manner set forth in this Statement of Additional Information
under "DETERMINATION OF NET ASSET VALUE." The amount between the Offering Price
and the net asset value of each Fund may be retained by the Distributor or it
may be reallowed in whole or in part to broker-dealers effecting sales of the
Company's shares. See "PURCHASE OF SHARES" in the Prospectus.
For the years ended December 31, 1995, December 31, 1994, and December 31,
1993, the Distributor retained $102,066, $178,576, and $278,330, respectively,
of sales commissions after reallowance to authorized persons of $348,575,
$592,881 and $891,122, respectively.
The Company pays the costs and expenses incident to registering and qualifying
its shares for sale under the Federal securities laws and under the applicable
state Blue Sky laws of the jurisdictions in which the Distributor desires to
distribute such shares and, pursuant to the Distribution Plan, the costs of
preparing, printing, and distributing prospectuses, reports and other marketing
materials to prospective investors.
DISTRIBUTION PLAN
The Company has adopted a plan of distribution pursuant to Rule 12b-1 under
the 1940 Act ("Distribution Plan"), which provides that the Company may,
directly or indirectly, engage in activities primarily intended to result in the
sale of the Company's shares.
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<PAGE>
The maximum expenditure the Company may make under the Distribution Plan will
be the lesser of the actual expenses incurred in distribution related activities
permissable under the Distribution Plan ("Rule 12b-1 activities"), as determined
by the Board of Directors of the Company, or, with respect to the Government
Securities Fund, the Total Return Fund, the Tax-Exempt Fund and the Growth and
Income Fund, the Capital Appreciation Fund and to Global Income Fund 0.50% per
annum of the net asset value of each such Fund. With respect to the Money Market
Fund, the maximum expenditure the Company may make under the Distribution Plan
will be the lesser of the actual expenses incurred in Rule 12b-1 activities, as
determined by the Board of Directors of the Company, or 0.25% per annum of the
net asset value of the Money Market Fund. Payments under the Distribution Plan
will be accrued daily and paid quarterly in arrears.
The National Association of Securities Dealers, Inc. ("NASD") recently adopted
amendments to Article III, Section 26 of its Rules of Fair Practice which, among
other things, (i) impose certain limits on "ASSET BASED SALES CHARGES" paid to
finance sales or sales promotion expenses) in order to regulate such charges
under the maximum sales load limitations applicable to investment companies and
(ii) treat "SERVICE FEES"; payments made for personal shareholder services
and/or maintenance of shareholder accounts) as distinguishable from asset based
sales charges and, therefore, outside the scope of the maximum sales load
limitations. The Company's Distribution Plan contemplates that activities to
both (i) finance the sale of Company shares and (ii) compensate persons who
render shareholder support services are Rule 12b-1 activities within the meaning
of the Distribution Plan.
In light of the NASD rule amendments, the Board of Directors, and separately a
majority of the Disinterested Directors, determined it would be appropriate and
in the best interest of the Company and its shareholders to clearly identify
that portion of the maximum expenditure under the Distribution Plan that should
be considered to be asset based sales charges and that portion should be
considered to be service fees. Consequently, it was determined that 0.25% per
annum of the average daily net asset value of the Chubb Government Securities
Fund, the Chubb Tax-Exempt Fund, the Chubb Total Return Fund, and the Chubb
Growth and Income Fund, Chubb Capital Appreciation Fund and Chubb Global Income
Fund and 0.075% per annum of the average daily net asset value of the Chubb
Money Market Fund be considered to be asset based sales charges, as defined by
Article III, Section 26 of the NASD's Rules of Fair Practice, and 0.25% per
annum of the average daily net asset value of the Chubb Government Securities
Fund, the Chubb Tax-Exempt Fund, the Chubb Total Return Fund, the Chubb
Growth and Income Fund, the Chubb Capital Appreciation Fund and the Chubb Global
Income Fund, and 0.175% per annum of the average daily net asset value of the
Chubb Money Market Fund be considered to be service fees, as defined by Article
III, Section 26 of the NASD's Rules of Fair Practice. No payment of a service
fee will be made to a securities
S-41
<PAGE>
dealer unless that dealer has sold shares of the Company, exclusive of the Money
Market Fund, that are outstanding for a minimum of 12 months and that are valued
in excess of $1,000,000 or, with respect to the Money Market Fund, has sold
shares of the Company valued in excess of $1,000,000.
The Distribution Plan was approved on September 4, 1987 by the Board of
Directors, and separately by all directors who are not interested persons of the
Company and who have no direct or indirect interest in the Distribution Plan or
related arrangements (the "Rule 12b-1 Directors"). The Distribution Plan was
approved by the shareholders of each Fund at the meeting of shareholders held
April 21, 1988. The Distribution Plan will continue in effect from year to year
if approved by the votes of a majority of the Company's Board of Directors and
the Rule 12b-1 Directors, cast in person at a meeting called for the purpose of
voting on such approval. All material amendments to the Distribution Plan must
be likewise approved by the Board of Directors and the Rule 12b-1 Directors. The
Distribution Plan may be terminated, without penalty, at any time by vote of a
majority of the Rule 12b-1 Directors or by vote of a majority of the outstanding
shares of the Company, on 60 days written notice. The Distribution Plan may not
be amended to increase materially the amount of expenditures under the
Distribution Plan unless such amendment is approved by a vote of the voting
securities of each Fund. The Distribution Plan does not provide for any charges
to the Company for excess amounts expended by the Distributor and, if the
Distribution Plan is terminated in accordance with its terms, the obligation of
the Company to make payments to the Distributor pursuant to the Distribution
Plan will cease. The Distribution Plan does not provide for the reimbursement of
the Distributor for any expenses of the Distributor attributable to the
Distributor's "overhead".
For the years ended December 31, 1995 and 1994, $186,402 and $134,885 was paid
by the Company to the Distributor under the Plan of Distribution. Prior to the
calendar year 1994 no payments had ever been made under the Distribution Plan.
OFFERING AND REDEMPTION OF SHARES
Shares of the Company are sold only at the Offering Price in effect at the
time of the sale, which is determined in the manner set forth in the Prospectus
under "PURCHASE OF SHARES". Shares of each Fund may also be acquired through
special purchase and redemption plans which provide for reduced sales charges,
as described in the Prospectus under "PURCHASE OF SHARES-REDUCED SALES CHARGES"
AND "SHAREHOLDER SERVICES". The reason for the reduced sales charges in the case
of rights of accumulation, the Letter of Intent, and qualified group purchases
is that expenses associated with such purchases are generally less than other
purchases of the Company's shares. Likewise, the purchase of the Company's
shares by directors and present and retired officers and full time employees
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<PAGE>
of the Company, the Investment Manager, the Investment Administrator and their
affiliates, and their close family members or certain registered personnel of
broker-dealers and their close family members do not involve the usual expenses
associated with the purchase of the Company's shares.
The Company redeems all full and fractional shares of the Company at the net
asset value per share applicable to each Fund. See "DETERMINATION OF NET ASSET
VALUE" below. Redemptions are normally made in cash, but the Company has
authority, at its discretion, to make full or partial payment by assignment to
shareholders of portfolio securities at their value used in determining the
redemption price. The Company, nevertheless, pursuant to Rule 18f-1 under the
1940 Act, has filed a notification of election on Form N-18f-1, by which the
Company has committed itself to pay to shareholders in cash, all such requests
for redemption made during any 90-day period, up to the lesser of $250,000 or 1%
of the applicable Fund's net asset value at the beginning of such period. The
securities, if any, to be paid in-kind to shareholders will be selected in such
manner as the Board of Directors deems fair and equitable. In such cases, a
shareholder would incur brokerage costs should the shareholder wish to liquidate
these portfolio securities.
The right to redeem shares or to receive payment with respect to any
redemption of shares of any Fund may only be suspended (1) for any period during
which trading on the New York Stock Exchange is restricted or such Exchange is
closed, other than customary weekend and holiday closings, (2) for any period
during which an emergency exists as a result of which disposal of securities or
determination of the net asset value of that series is not reasonably
practicable, or (3) for such other periods as the Securities and Exchange
Commission may by order permit for protection of shareholders of that Fund.
DETERMINATION OF NET ASSET VALUE
The net asset value of the shares of each Fund of the Company is normally
determined immediately as of the close of trading on the New York Stock Exchange
(usually 4:00 p.m. New York Time) on each day during which the New York Stock
Exchange is open for trading and at such other times when both the degree of
trading in a Fund's portfolio securities would materially affect the net asset
value of that Fund's shares and shares of that Fund were tendered for redemption
or a repurchase order was received. The New York Stock Exchange is open from
Monday through Friday except on the following national holidays: New Years Day,
President's Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day, and Christmas Day.
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<PAGE>
Portfolio securities which are traded on national securities exchanges are
valued at the last quoted sale price as of the close of business of the New York
Stock Exchange or, lacking any quoted sales, at the mean between the closing bid
and asked prices.
Securities traded in the over-the-counter market as part of the NASDAQ
National Market system are valued at the last quoted sale price (at the close of
the New York Stock Exchange) obtained from a readily available market quotation
system or securities pricing services. If no sale took place, such securities
are valued at the mean between the bid and asked prices.
U.S. Treasury securities and other obligations issued or guaranteed by the
United States Government, its agencies or instrumentalities with remaining
maturities of 60 days or more, are valued at representative quoted prices from
bond pricing services.
Long-term publicly traded corporate bonds are valued at prices obtained from a
bond pricing service when such prices are available or, when appropriate, from
over-the-counter or exchange quotations.
Foreign securities denominated in foreign currencies are valued at
representative quoted prices in the closing price on the principal exchange of
the country of origin and are converted to United States dollar equivalents
using that day's current exchange rate (New York midday spot). All non-U.S.
securities traded in the over-the-counter securities market are valued at the
last sale quote, if market quotations are available, or the last closing bid
price, if there is no active trading in a particular security for a given day.
Where market quotations are not readily available for such non-U.S. over-the-
counter securities, then such securities will be valued in good faith by a
method that the Board of Directors, or its delegates, believes accurately
reflects fair value.
With respect to the Money Market Fund, all money market instruments with a
remaining maturity of 13 months or less held by the Fund are valued on an
amortized cost basis, unless the Board of Directors determines that such method
does not represent fair value. In addition, with respect to the other Funds,
short-term debt instruments, including commercial paper and U.S. Treasury
securities, with a remaining maturity of 60 days or less are valued on an
amortized cost basis, unless the Board of Directors determines that such method
does not represent fair value. Under the amortized cost valuation method, the
security is initially valued at cost on the date of purchase. Thereafter, a
constant proportionate amortization of any discount or premium is calculated
until maturity, regardless of the impact of fluctuating interest rates on the
market value of the security. The amortized cost value of the security may be
either more or less than the market value at any given time. If for any reason
the fair market value of any security is not fairly reflected through the
amortized cost
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<PAGE>
method of valuation, such security will be valued by market quotations, if
available, otherwise as determined in good faith by the Board of Directors.
Options and convertible preferred stocks listed on national securities
exchanges are valued as of their last sale price or, if there is no sale, at the
current bid price.
Futures contracts are valued as of their last sale price or, if there is no
sale, at the latest available bid price.
Securities and assets for which market quotations are not readily available
are valued at fair value as determined in good faith by the Board of Directors
of the Company using its best judgment.
MAINTENANCE OF NET ASSET VALUE PER SHARE
FOR THE MONEY MARKET FUND
It is the policy of the Money Market Fund to attempt to maintain a net asset
value of $1.00 per share by utilizing the amortized cost method of valuation.
Although the Money Market Fund believes that it will be able to maintain its net
asset value at $1.00 per share under most conditions, there can be no absolute
assurance that it will be able to do so on a continuous basis. If the Money
Market Fund's net asset value per share declined, or was expected to decline,
below $1.00 (rounded to the nearest one cent) the Board of Directors of the
Company might temporarily reduce or suspend dividend payments in an effort to
maintain the net asset value at $1.00 per share. As a result of such reduction
or suspension of dividends, an investor would receive less income during a given
period than if such reduction or suspension had not taken place. Such action
could result in an investor receiving no dividend for the period during which
the investor holds his/her shares and in receiving, upon redemption, a price per
share lower than that which the investor paid. On the other hand, if the Money
Market Fund's net asset value per share were to increase, or were anticipated to
increase above $1.00 (rounded to the nearest one cent), the Board of Directors
might supplement dividends in an effort to maintain the net asset value at $1.00
per share.
TAXES AND DIVIDENDS
In order for each Fund to qualify for Federal income tax treatment as a
regulated investment company ("RIC"), at least 90% of its gross income for a
taxable year must be derived from qualifying income, i.e., dividends, interest,
income derived from loans of securities, and gains from the sale of securities.
In addition, gains realized on the sale or the disposition of securities held
for less than three months must be limited to less than 30% of the Company's
annual gross income. It is the Company's policy to comply with the provisions of
the Internal Revenue Code of 1986 (the "Code") regarding distribution of
investment income and
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<PAGE>
capital gains so that each Fund will not be subject to Federal income tax on
amounts distributed or an excise tax on certain undistributed income or capital
gains.
Dividends from ordinary income will be declared daily and distributed monthly
with respect to the Money Market Fund, and the Government Securities Fund,
declared and distributed on a monthly basis with respect to the Tax-Exempt Fund
and the Global Income Fund, declared and distributed on a quarterly basis with
respect to the Total Return Fund, and on an annual basis with respect to the
Growth and Income Fund and the Capital Appreciation Fund. Ordinary income of
each Fund is generally the investment company taxable income, as defined in
Section 852(b) of the Code, determined (1) by excluding the amount of capital
gains, if any, and (2) without allowance of the deduction for dividends paid.
A corporate shareholder may be entitled to take a deduction for income
dividends it receives that are attributable to dividends received from a
domestic corporation, provided that both the corporate shareholder retains its
shares in the applicable Fund for more than 45 days and the Fund retains its
shares in the issuer from whom it received the income dividends for more than 45
days. A dividend of capital gains net income reflects the Fund's excess of net
long-term gains over its net short-term losses. Each Fund must designate which
dividends are dividends of capital gains net income and must notify shareholders
of this designation within sixty days after the close of the Fund's taxable
year. A corporate shareholder of a Fund cannot use a dividends-received
deduction for these dividends.
If, in any taxable year, a Fund should not qualify as a RIC under the Code:
(i) that Fund would be taxed at normal corporate rates on the entire amount of
its taxable income without deduction for dividends or other distributions to its
shareholders; and (ii) that Fund's distributions to the extent made out of the
Fund's current or accumulated earnings and profits would be taxable to its
shareholders (other than shareholders in tax deferred accounts) as ordinary
dividends (regardless of whether they would otherwise have been considered
capital gains dividends), but may, in certain circumstances, qualify for the
deduction for dividends received by corporations.
Certain currency gains or losses realized on disposition of foreign currencies
and debt securities by any Fund, called "Section 988 Transactions," must be
calculated separately. Such gains or losses are generally treated as ordinary
income unless certain elections are made by a Fund. Such gains or losses will be
included in each Fund's annual income dividend, as appropriate.
If a Fund purchases shares in certain foreign investment entities, called
"passive foreign investment companies" ("PFIC"), that Fund may be subject to
U.S. federal income tax on a portion of any
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<PAGE>
"excess distribution" including a gain from the disposition of the shares even
if the income is distributed as a taxable dividend by the Fund to its
shareholders. Additional charges in the nature of interest may be impose on
either the Fund or its shareholders with respect to deferred taxes arising from
the distributions or gain. If a Fund were to purchase shares in a PFIC and (if
the PFIC made the necessary information available) elected to treat the PFIC as
a "qualified electing fund" under the Code, in lieu of the foregoing
requirements, the Fund would be required to include in income each year a
portion of the ordinary earnings and net capital gains of the PFIC, even if not
distributed to the Fund, and the amounts would be subject to the 90 percent and
calendar year distribution requirements described above.
PERFORMANCE AND YIELD INFORMATION
COMPARISONS OF PERFORMANCE INFORMATION
From time to time, in reports and sale literature: (1) each Fund's performance
or P/E ratio may be compared to: (i) the Standard & Poor's 500 Composite Stock
Price Index ("S&P 500 Index") and Dow Jones Industrial Average so that the
investor may compare that Fund's results with those of a group of unmanaged
securities widely regarded by investors as representative of the United States
stock market in general; (ii) other groups of mutual funds tracked by: (A)
Lipper Analytical Services, Inc., a widely-used independent research firm which
ranks mutual funds by overall performance, investment objectives, and asset
size; (B) Forbes Magazine's Annual Mutual Funds Survey and Mutual Fund Honor
Roll; or (C) other financial or business publications, such as the Wall Street
Journal, Business Week, Money Magazine, and Barron's, which provide similar
information; (iii) indices of stocks comparable to those in which the particular
Fund invests; (2) the Consumer Price Index (measure for inflation) may be used
to assess the real rate of return from an investment in each Fund; (3) other
government statistics such as Gross Domestic Product, and net import and export
figures derived from governmental publications, e.g., The Survey of Current
Business, may be used to illustrate investment attributes of each Fund or the
general economic, business, investment, or financial environment in which each
Fund operates; and (4) the effect of tax-deferred compounding on the particular
Fund's investment returns, or on returns in general, may be illustrated by
graphs, charts, etc. where such graphs or charts would compare, at various
points in time, the return from an investment in the particular Fund (or returns
in general) on a tax-deferred basis (assuming reinvestment of capital gains and
dividends and assuming one or more tax rates) with the return on a taxable
basis.
From time to time advertisements and sales literature may refer to rankings
and ratings of the Investment Manager and/or Chubb Corporation, Chubb &
Sons and Chubb Life Insurance Company of
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<PAGE>
America and Chubb Service Corporation related to their size, performance,
management and/or service as prepared by various trade publications, such as
Dalbar, Pensions and Investments, SEI, CDA, Bests, and others.
Each Portfolio's performance may also be compared to the performance of other
mutual funds by Morningstar, Inc., which ranks mutual funds on the basis of
historical risk and total return. Morningstar rankings are calculated using the
mutual fund's average annual returns for certain periods and a risk factor that
reflects the mutual fund's performance relative to three-month Treasury bill
monthly returns. Morningstar's rankings range from five stars (highest) to one
star (lowest) and represent Morningstar's assessment of the historical risk
level and total return of a mutual fund as a weighted average for 3, 5, and 10-
year periods. In each category, Morningstar limits its five star rankings to 10%
of the funds it follows and its four star rankings to 22.5% of the funds it
follows. Rankings are not absolute or necessarily predictive of future
performance.
When Lipper's rankings or performance results are used, a Fund will be
compared to Lipper's appropriate fund category by fund objective and portfolio
holdings. For instance, the Growth and Income Fund will be compared to funds
within Lipper's growth and income fund category; the Government Securities Fund
will be compared to funds within Lipper's income fund category; and so on.
Rankings may be listed among one or more of the asset-size classes as determined
by Lipper. Since the assets in the Funds may change, a Fund may be ranked within
one Lipper asset-sized class at one time and in another Lipper asset-size class
at some other time. The Lipper rankings and performance analysis ranks funds on
the basis of total return, assuming reinvestment of distribution, but does not
take sales charges or redemption fees into consideration and is prepared without
regard to tax consequences. Lipper also issues a monthly yield analysis for
fixed-income funds. Footnotes in advertisements and other marketing literature
will include the time period and Lipper asset-size class, as applicable, for the
ranking in question.
As noted above, the performance of a Fund may be compared, for example, to the
record of the S&P 500 Index, as well as the Russell 2000 Index, the S&P MidCap
400 Index, the Bear Stearns Foreign Bond Index, the NASDAQ Composite Index and
the Morgan Stanley Capital International's Europe Australia, Far Eastern
("EAFE") Index. The S&P 500 Index is a well known measure of the price
performance of 500 leading larger domestic stocks which represent approximately
80% of the market capitalization of the United States equity market. The Russell
2000 Index, the S&P MidCap 400 Index, the Bear Stearns Foreign Bond Index are
unmanaged indices, the NASDAQ Composite Index and the Morgan Stanley
Capital International's Euro The The NASDAQ Composite Index is comprised of all
stocks on NASDAQ's National Market Systems, as well as other NASDAQ domestic
equity securities. The NASDAQ Composite Index has typically
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<PAGE>
included smaller, less mature companies representing 10% or 15% of the
capitalization of the entire domestic equity market. The EAFE Index is comprised
of more than 900 companies in Europe, Australia and the Far East. All of these
indices are unmanaged and capitalization weighted. In general, the securities
comprising the NASDAQ Composite Index are more growth oriented and have a
somewhat higher beta and P/E ratio than those in the S&P 500 Index.
The total returns of all indices noted above will show the changes in prices
for the stocks in each index. However, only the performance data for the S&P 500
Index assumes reinvestment of all capital gains distributions and dividends paid
by the stocks in each data base. Tax consequences will not be included in such
illustration, nor will brokerage or other fees or expenses of investing be
reflected in the NASDAQ Composite, S&P 500, EAFE Index.
MONEY MARKET FUND
For the seven days ended December 31, 1995, the yield of the Money Market Fund
expressed as a simple annualized yield was 4.68%; the yield of the Money Market
Fund expressed as a compound effective yield was 4.79%. These figures reflect a
portion of fees and other expenses of the Company which were waived or assumed
during the stated period. Absent any waiver or assumption of fees and expenses,
the yield expressed as a simple annualized yield would have been 3.86% and the
yield expressed as a compound effective yield would have been 3.94%.
The Money Market Fund's yield is its investment income, less expenses, expressed
as a percentage of assets on an annualized basis for a seven-day period. The
yield is expressed as a simple annualized yield and as a compound effective
yield.
The simple annualized yield is computed by determining the net charge
(exclusive of realized gains and losses from the sale of securities and
unrealized appreciation and depreciation) in the value of a hypothetical pre-
existing account having a balance of one share at the beginning of the seven-day
period, and annualizing the resulting quotient (base period return) on a 365-day
basis. The net change in account value reflects the value of additional shares
purchased with dividends from the original shares in the account during the
seven-day period, dividends declared on such additional shares during the
period, and expenses accrued during the period.
The compound effective yield is computed by determining the unannualized base
period return, adding one to the base period return, raising the sum to a power
equal to 365 divided by seven, and subtracting one from the result.
S-49
<PAGE>
NON-MONEY MARKET FUNDS
The yield for the 30-day period ended December 31, 1995 for the Tax-Exempt
Fund was 4.26% and for the Government Securities Fund it was 6.48%. The tax
equivalent yield for the Tax-Exempt Fund for the same period assuming federal
tax brackets of 36%, and 39.6% were 6.65%, and 7.05%, respectively. These
figures reflect a portion of fees and other expenses of the Company which were
waived or assumed during the stated period. Absent any waiver or assumption of
fees and expenses the yields for the Tax-Exempt Fund and the Government
Securities Fund would have been 3.60% and 5.92%, respectively, and the tax
equivalent yields for the Tax-Exempt Fund of 36% and 39.6% tax brackets would
have been 5.62%, and 5.95%, respectively.
This yield figure represents the net annualized yield based on a specified 30-
day (or one month) period assuming a reinvestment and semiannual compounding of
income. Yield is calculated by dividing the average daily net investment income
per share earned during the specified period by the maximum offering price per
share on the last day of the period, and annualizing the net result according to
the following formula:
A - B
- -----
Yield = 2 [( CD + 1)/6/ - 1]
where A equals dividends and interest earned during the period, B equals
expenses accrued for the period (net of reimbursements), C equals the average
daily number of shares outstanding during the period that were entitled to
receive dividends, and D equals the maximum offering price per share on the last
day of the period. A tax equivalent yield is calculated by dividing that portion
of the 30-day yield figure which is tax-exempt by one minus the effective
federal income tax rate and adding the product to that portion, if any, of the
yield of the Fund that is not tax-exempt.
The average annual total return quotations for the Government Securities Fund,
the Total Return Fund, the Tax-Exempt Fund and the Growth and Income Fund for
the 12 months ended December 31, 1995 were 13.99%, 23.59%, 12.38%, and
28.72%, respectively. The average annual total return quotations for these
Funds for the 5 years ended December 31, 1995 were 8.45%, 13.30%, 7.50%, and
15.11%, respectively. The average annual total return quotations for these Funds
since the Company's inception on December 1, 1987 through December 31, 1995 were
9.26%, 12.24%, 8.62%, and 13.15%, respectively. Additionally the Capital
Appreciation Fund and the Global Income Funds average total return since
inception September 1, 1995 were -0.67% and 0.16%, respectively. These figures
reflect a portion of fees and other expenses of the Company which were waived or
assumed during the stated period.
These average annual total return figures represent the average annual
compound rate of return for the stated period. Average annual total return
quotations reflect the percentage change
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<PAGE>
between the beginning value of a static account in the specified Fund and the
ending value of that account measured by the then current net asset value of
that Fund assuming that all dividends and capital gains distributions during the
stated period were reinvested in shares of the Fund when paid. Total return is
calculated by finding the average annual compound rates of return of a
hypothetical investment that would compare the initial amount to the ending
redeemable value of such investment according to the following formula:
T = (ERV/P) /1///n/ - 1
where T equals average annual total return, where ERV, the ending redeemable
value, is the value, at the end of the applicable period, of a hypothetical
$1,000 payment made at the beginning of the applicable period, where P equals a
hypothetical initial payment of $1,000, and where N equals the number of years.
The Funds also may advertise non-standardized total return quotations,
calculated in the same manner as the quotations stated above, except that the
initial value used is the net asset value. Under this total return calculation,
the average annual total return quotations for the Government Securities Fund,
the Total Return Fund, the Tax-Exempt Fund, and the Growth and Income Fund for
the 12 months ended December 31, 1995 were 17.50%, 30.13%, 15.88%, and 35.52%,
respectively. Under this same calculation, the average annual total return
quotations for these Funds for the 5 years ended December 31, 1995 were 9.11%,
14.47%, 8.00%, and 16.29%, respectively. Under this same calculation, the
average annual total return quotations for these Funds since the Company's
inception on December 1, 1987 through December 31, 1994 are 9.67%, 12.96%,
9.03%, and 13.88%, respectively. In addition under the same calculation the
average annual total return for the Capital Appreciation Fund and the Global
Income Fund since their inception September 1, 1995 through December 31, 1995
are 4.60% and 3.27%, respectively.
FINANCIAL STATEMENTS
The financial statements contained in the Company's December 31, 1995 Annual
Report to shareholders are incorporated herein by reference.
ADDITIONAL INFORMATION
NAME AND SERVICE MARK
The Chubb Corporation has granted the Company the right to use the "Chubb" name
and service mark and has reserved the right to withdraw its consent to the use
of such name and mark by the Company at any time and to grant the use of such
name and mark to any other users.
S-51
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
Filed as part of this Prospectus:
Financial Highlight
(a) Financial Statements
The financial statements contained in the Company's December 31, 1995
Annual Report to shareholders are incorporated by reference in the
Company's Statement of Additional Information./9/
(b) Exhibits
1. a. Amended and Restated Articles of Incorporation./2/
b. Articles Supplementary to the Amended and Restated Articles of
Incorporation./6/
c. Articles Supplementary to the Amended and Restated Articles of
Incorporation./8/
2. Amended and Restated By-Laws./4/
3. Not applicable.
4. a. Specimen of Certificate of Stock of the Chubb Money
Market Fund./1/
b. Specimen of Certificate of Stock of the Chubb Government
Securities Fund./1/
c. Specimen of Certificate of Stock of the Chubb Total Return
Fund./1/
d. Specimen of Certificate of Stock of the Chubb Tax-Exempt Fund./1/
e. Specimen of Certificate of Stock of the Chubb Growth and Income
Fund./5/
f. Specimen of Certificate of Stock of the Chubb Capital Appreciation
Fund./8/
g. Specimen of Certificate of Stock of the Chubb Global Income
Fund./8/
5. a. Investment Management Agreement between Chubb Investment Funds, Inc.,
Chubb Investment Advisory Corporation and Chubb Asset Managers, Inc. with
respect to Chubb Money Market Fund./1/
b. Technical Amendment to Investment Management Agreement between
Chubb Investment Funds, Inc., Chubb Investment Advisory Corporation
and Chubb Asset Managers, Inc. with respect to Chubb Money Market
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<PAGE>
Fund./3/
c. Investment Management Agreement between Chubb Investment Funds,
Inc., Chubb Investment Advisory Corporation and Chubb Asset Managers,
Inc. with respect to Chubb Government Securities Fund./1/
d. Technical Amendment to Investment Management Agreement between
Chubb Investment Funds, Inc., Chubb Investment Advisory Corporation
and Chubb Asset Managers, Inc. with respect to Chubb Government
Securities Fund./3/
e. Investment Management Agreement between Chubb Investment Funds,
Inc., Chubb Investment Advisory Corporation and Chubb Asset Managers,
Inc. with respect to Chubb Total Return Fund./1/
f. Technical Amendment to Investment Management Agreement between
Chubb Investment Funds, Inc., Chubb Investment Advisory Corporation
and Chubb Asset Managers, Inc. with respect to Chubb Total Return
Fund./3/
g. Investment Management Agreement between Chubb Investment Funds,
Inc., Chubb Investment Advisory Corporation and Chubb Asset Managers,
Inc. with respect to Chubb Tax-Exempt Fund./1/
h. Technical Amendment to Investment Management Agreement between
Chubb Investment Funds, Inc., Chubb Investment Advisory Corporation
and Chubb Asset Managers, Inc. with respect to Chubb Tax-Exempt
Fund./3/
i. Investment Management Agreement between Chubb Investment Funds,
Inc., Chubb Investment Advisory Corporation and Chubb Asset Managers,
Inc. with respect to Chubb Growth Fund, (now known as the Chubb Growth
and Income Fund)./1/
j. Technical Amendment to Investment Management Agreement between
Chubb Investment Funds, Inc., Chubb Investment Advisory Corporation
and Chubb Asset Managers, Inc. with respect to Chubb Growth Fund./3/
k. Investment Management Agreement between Chubb Investment Funds,
Inc., Chubb Investment Advisory Corporation and Chubb Asset Managers,
Inc. with respect to Chubb Capital Appreciation Fund.
l. Investment Management Agreement between Chubb Investment Funds,
Inc., Chubb Investment Advisory Corporation and Chubb Asset Managers,
Inc. with respect to Chubb Global Income Fund.
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<PAGE>
6. a. Fund Distribution Agreement between Chubb Investment Funds, Inc. and
Chubb Securities Corporation./1/
b. Speciman Copy of Selected Dealers Agreement./1/
7. Not applicable.
8. Custodial Services Agreement between Chubb Investment Funds, Inc. and
Citibank, N.A./1/
9. a. Shareholder Services Agreement between Chubb Investment Funds, Inc.
and Firstar Trust Company./7/
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<PAGE>
b. Agreement for Waiver of Fees and Assumption of Expenses between Chubb
Investment Funds, Inc., Chubb Investment Advisory Corporation, Chubb Asset
Managers, Inc., Chubb Securities Corporation, and Chubb Life Insurance
Company of New Hampshire./4/
10. Opinion and Consent of Counsel as to legality of the securities being
registered./1/
a. Opinion and Consent of Counsel as to legality of the securities
being registered./8/
12. Not applicable.
13. Stock Subscription Agreement between Chubb Investment Funds, Inc. and Chubb
Life Insurance Company of America./1/
15. Rule 12b-1 Plan./1/
16. NA
17. NA
19. Consent of Freedman, Levy, Kroll & Simonds./1/
20. Power of Attorney.*
27.
99.1 Consent of Ernst & Young LLP.*
99.2 Stock Subscription Agreement between Chubb Investment Funds, Inc. and Chubb
Life Insurance Company of America.*
99.3 Fee Table Information and Schedule of Computation Information.
99.4 Diagram of Subsidiaries of The Chubb Corporation.*
99.5 Price Make-up Sheet.*
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<PAGE>
/1/ Incorporated by reference to earlier filing on September 17, 1987, SEC File
No. 33-147367, to the exhibit number indicated on that Form N-1A Registration
Statement.
/2/ Incorporated by reference to earlier filing on April 28, 1988, SEC File No.
33-147367, to the exhibit number indicated on that Form N-1A Registration
Statement.
/3/ Incorporated by reference to earlier filing on April 17, 1989, SEC File No.
33-147367, to the exhibit number indicated on that Form N-1A Registration
Statement.
/4/ Incorporated by reference to earlier filing on April 15, 1991, SEC File No.
33-14737, to the exhibit number indicated on that Form N-1A Registration
Statement.
/5/ Incorporated by reference to earlier filing on April 22, 1992, SEC File No.
33-14737, to the exhibit number indicated on that Form N1-A Registration
Statement.
/6/ Incorporated by reference to earlier filing on April 23, 1994, SEC File No.
33-14737, to the exhibit number indicated on that Form N1-A Registration
Statement.
/7/ Incorporated by reference to earlier filing on April 17, 1995, SEC File No.
33-14737, to the exhibit number indicated on that Form N-1A Registration
Statement.
/8/ Incorporated by reference to earlier filing on June 16, 1995, SEC File No.
33-14737, to the exhibit number indicated on that Form N-1A Registration
Statement.
/9/ Incorporated by reference to Annual Report to Shareholders filed on
February 29, 1996, SEC File No. 33-14737.
*Filed herewith.
Item 25. Persons Controlled by or under Common Control with Registrant
No person is directly or indirectly controlled by Registrant.
The information in the Registrant's Statement of Additional Information dated
April 1, 1996 relating to ownership by Chubb Life Insurance Company of America
("Chubb Life") and its affiliated companies of outstanding shares of the Company
is incorporated herein by reference.
Chubb Life is a wholly-owned subsidiary of The Chubb Corporation, a New Jersey
corporation. Chubb Life owns all of the outstanding shares of Chubb Investment
Advisory Corporation ("Chubb Investment Advisory"), a Tennessee corporation,
which is the Investment Administrator of the Registrant. Chubb Asset Managers,
Inc. ("Chubb Asset"), a Delaware corporation, which is the
C-5
<PAGE>
Investment Manager for the Registrant, is a wholly-owned subsidiary of The Chubb
Corporation. The principal underwriter and Distributor for the Registrant,
Chubb Securities Corporation, a New Hampshire corporation, is a wholly-owned
subsidiary of Chubb Life. A diagram of the subsidiaries of The Chubb
Corporation has been filed herein as Exhibit 17.
Item 26. Number of Holders of Securities
As of February 29, 1995.
(2)
(1) Number of
Title of Class Record Holders
-------------- --------------
Chubb Money Market Fund; $.01 par value 730
Chubb Government Securities Fund; $.01 par value 904
Chubb Total Return Fund; $.01 par value 1975
Chubb Tax-Exempt Fund; $.01 par value 884
Chubb Growth and Income Fund; $.01 par value 2722
Chubb Capital Appreciation Fund; $.01 par value 241
Chubb Global Income Fund; $.01 par value 60
Chubb Life is the successor-in-interest to Chubb Life Insurance Company of
New Hampshire, which had provided the initial capital to the Company by
purchasing 100,000 shares of the Chubb Money Market Fund and 10,000 shares each
of the Chubb Government Securities Fund, the Chubb Total Return Fund, the Chubb
Tax-Exempt Fund, the Chubb Growth and Income Fund, the Chubb Capital
Appreciation Fund and the Chubb Global Income Fund, respectively.
Item 27. Indemnification
Reference is made to Article VII, Section 10 of the Registrant's Amended and
Restated Articles of Incorporation filed herein as Exhibit 1 to this
Registration Statement and to Article V of the Registrant's By-Laws filed herein
as Exhibit 2 to this Registration Statement. The Articles of Incorporation
provide that neither an officer nor director of the Registrant will be liable to
the Registrant or its shareholders for monetary damages for breach of fiduciary
duty as an officer or director, except to the extent such limitation of
liability is not otherwise permitted by law. The By-Laws provide that the
Registrant will indemnify its directors and officers to the extent permitted or
required by Maryland law. A resolution of the Board of Directors specifically
approving payment or advancement of expenses to an officer is required by the
By-Laws. Indemnification may not be made if the director or officer has
incurred liability by reason or willful misfeasance, bad faith, gross negligence
or reckless disregard of duties in the conduct of his/her office ("Disabling
Conduct"). The means of determining whether indemnification shall be made are
(1) a final decision by a court or other body before
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<PAGE>
whom the proceeding is brought that the director or officer was not liable by
reason of Disabling Conduct, or (2) in the absence of such a decision, a
reasonable determination, based on a review of the facts, that the director or
officer was not liable by reason of Disabling Conduct. Such latter
determination may be made either by (a) vote of a majority of directors who are
neither interested persons (as defined in the Investment Company Act of 1940)
nor parties to the proceeding or (b) independent legal counsel in a written
opinion. The advancement of legal expenses may not occur unless the director or
officer agrees to repay the advance (if it is determined that he/she is not
entitled to the indemnification) and one of three other conditions is satisfied:
(1) the director or officer provides security for his/her agreement to repay,
(2) the Registrant is insured against loss by reason of lawful advances, or (3)
the directors who are not interested persons and are not parties to the
proceedings, or independent counsel in a written opinion, determine that there
is reason to believe that the director or officer will be found entitled to
indemnification. The directors and officers are currently covered for
liabilities incurred in their capacities as such directors and officers under
the terms of a joint liability insurance policy. This policy also covers the
directors and officers of Chubb Investment Advisory, Chubb Asset and Chubb
America Fund, Inc. The policy also insures the Registrant, Chubb Investment
Advisory, Chubb Asset and Chubb America Fund, Inc. for errors and omissions
liabilities.
Insofar as indemnification for liability arising under the Securities Act
of 1933 (the "Securities Act") may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
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<PAGE>
Item 28. Business and Other Connections of Investment Manager
and Investment Administrator
Chubb Investment Advisory was formed in 1984 and, since 1985, has served as
an investment manager to Chubb America Fund, Inc., and to Chubb Series Trust,
One Granite Place, Concord, New Hampshire 03301.
Chubb Asset was formed in 1986 and was not previously engaged in any
business. It also serves as sub-investment manager for the Bond Portfolio, the
Money Market Portfolio, and the Growth and Income Portfolio of Chubb America
Fund, Inc.
Set forth below in the following tables is certain information about the
officers and directors of Chubb Investment Advisory and Chubb Asset.
Chubb Investment Advisory
Name of Positions
Director/Officer of with Chubb Other Business, Profession,
Chubb Investment Vocation or Employment
Investment Advisory Advisory During Past Two Years
------------------- -------- ---------------------
Ronald R. Angarella President Senior Vice President,
Chubb Life, Chairman and
President, Chubb Securities
and Hampshire Funding,
Inc.; President and
Director, Hampshire
Syndications, President and
Director, Chubb America
Fund, Inc.; President Chubb
Series Trust
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<PAGE>
<TABLE>
<CAPTION>
Name of
Director/Officer of Positions
Chubb with Chubb Other Business, Profession,
Investment Investment Vocation or Employment
Advisory Advisory During Past Two Years
- -------- -------- ---------------------
<S> <C> <C>
Charles C. Cornelio Secretary Vice President and General Counsel
of the Registrant and Chubb America
Fund, Inc.; Vice President General
Counsel and Secretary of Chubb
Securities Corporation and Hampshire
Funding, Inc.; Senior Vice President,
Counsel and Assistant Secretary of
Chubb Life and Chubb America Service
Corporation; Vice President and
Counsel of Chubb Series Trust.
John A. Weston Treasurer Assistant Vice President and Mutual
Fund Accounting Officer of Chubb Life;
Treasurer of the Registrant, Chubb
America Fund, Inc., Chubb Securities
Corporation, Hampshire Funding, Inc.
and Chubb Series Trust; previously,
Financial Reporting Officer of Chubb
Life.
Richard A. Werner Director Senior Vice President, Treasurer and
Chief Accounting Officer of Chubb
Life; Vice President of The Chubb
Corporation; Senior Vice President and
Director of Chubb America Fund, Inc.
Marjorie D. Raines Director Vice President of The Chubb
Corporation and Chubb Asset; Senior
Vice President of Federal Insurance
Company and Chubb & Son, Inc.
</TABLE>
C-9
<PAGE>
Name of
Director/Officer of Positions
Chubb with Chubb Other Business, Profession,
Investment Investment Vocation or Employment
Advisory Advisory During Past Two Years
- -------- -------- ----------------------
Michael O'Reilly Senior Vice President and Director of
President and the Registrant; Senior Vice
Director President and Chief Investment Officer
of The Chubb Corporation; Director,
President and Chief Operating Officer
of Chubb Asset; Senior Vice President
of Federal Insurance Company and Chubb
& Son, Inc.
Mary Toumpas Assistant Assistant Vice President and Assistant
Vice Secretary of Chubb Securities
President and Corporation and Hampshire Funding,
Compliance Inc.
Officer
<PAGE>
<TABLE>
<CAPTION>
Name of Positions
Director/Officer of with Chubb Other Business, Profession,
Chubb Investment Vocation or Employment
Investment Advisory Advisory During Past Two Years
- ------------------- -------- ---------------------
<S> <C> <C>
Carol R. Hardiman Assistant Vice President, Chubb Securities
Vice Corporation and Hampshire Funding,
President Inc.
Shari J. Lease Assistant Assistant Vice President and Counsel
Secretary of Chubb Life and Secretary of the
Registrant, Chubb America Fund, Inc.
Chubb Series Trust and Chubb Asset
<CAPTION>
Chubb Asset
Positions Other Business, Profession,
Name of with Chubb Vocation or Employment
Director/Officer Asset During Past Two Years
- ---------------- ---------- ---------------------
<S> <C> <C>
Dean R. O'Hare Director, Director and Chairman of The Chubb
Chairman and Corporation; Managing Director and
Chief Chairman of Chubb & Son Inc.;
Executive Director, Chairman and President of
Officer Federal Insurance Company
</TABLE>
C-11
<PAGE>
Chubb Asset
Positions Other Business, Profession,
Name of with Chubb Vocation or Employment
Director/Officer Asset During Past Two Years
- ---------------- ------------ -----------------------
Michael O'Reilly Director, Senior Vice President and
President and Chief Investment Officer of
Chief The Chubb Corporation;
Operating President and Director
Officer of the Registrant; Senior
Vice President of Chubb &
Son Inc., Federal Insurance
Company, and Chubb
Investment Advisory
Marjorie D. Raines Senior Vice Vice President of The Chubb
President Corporation; Vice President
of Federal Insurance
Company and Chubb & Son
Inc.
Ned I. Gerstman Senior Vice Vice President of The Chubb
President Corporation, Chubb & Son
Inc. and Chubb Life
Frederick W. Senior Vice Vice President of The Chubb
Gaernter President Corporation and Chubb & Son
Inc.; formerly, Vice
President of Salomon
Brothers, Inc.
David K. Schafer Senior Vice President, Chubb Equity
President Managers, Inc.; Director
and President, Schafer
Value Fund, Inc.; Director,
President, and Treasurer,
Schafer Capital Manage-
ment, Inc.; Chairman of the
Board, Schafer Cullen
Capital Management, Inc.,
sole proprietor, Schafer
Capital Management Co.
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<PAGE>
Gail Devlin Director Senior Vice President of
the Chubb Corporation
Henry G. Gulick Secretary Vice President and Secretary of the
Chubb Corporation and Federal
Insurance Company, Senior Vice
President and Secretary of Chubb &
Son Inc.
Philip Semplier Treasurer Vice President and Treasurer of the
Chubb Corporation and Federal
Insurance Company; Senior Vice
President and Treasurer of Chubb &
Son Inc.
Robert Witkoff Vice Portfolio Manager for the Chubb
President Corporation
Thomas J. Swartz Vice Portfolio Manager for the Chubb
President Corporation
William Clarkson Assistant Securities Analyst for the Chubb
Vice Corporation
President
Paul Geyer Assistant Securities Analyst for the Chubb
Vice Corporation
President
Item 29. Principal Underwriters
The names, principal business addresses, positions and offices with Chubb
Securities Corporation, and positions and offices with the Registrant, of each
director or officer of Chubb Securities
C-13
<PAGE>
Corporation who is a director or officer of the Registrant are:
Name and Principal Positions and Positions and Offices
Business Address Offices with with the Registrant
Chubb Securities
Ronald R. Angarella Chairman and Senior Vice President
One Granite Place President and Director
Concord, NH 03301
Charles C. Cornelio Secretary and Vice President and
One Granite Place Counsel General Counsel
Concord, NH 03301
John A. Weston Treasurer Treasurer
One Granite Place
Concord, NH 03301
Item 30. Location of Accounts and Records
The following entities prepare, maintain and preserve the records required by
Section 31(a) of the 1940 Act for the Registrant. These records include
records relating to activities of these entities required to be maintained under
Rules 31a-1 and 31a-2 of the 1940 Act, records relating to applicable federal
and state tax laws, and records under any other law or administrative rules or
procedures applicable to the Company. The services are provided to the
Registrant through written agreements between the parties to the effect that
such services will be provided to the Registrant for such periods prescribed by
the Rules and Regulations of the Securities and Exchange Commission under the
C-14
<PAGE>
1940 Act and such records will be surrendered promptly on request:
Citibank, N.A., 111 Wall Street, New York, New York 10043 (records relating to
activities of the custodian and any subcustodian); Chubb Asset Managers, Inc.,
15 Mountain View Road, Warren, New Jersey 07061 (records relating to activities
of the Investment Manager); Chubb Securities Corporation, One Granite Place,
Concord, New Hampshire 03301 (records relating to activities of the
Distributor); Firstar Trust Company 615 East Michigan Street Milwaukee,
Wisconsin 53202-5207 (records relating to the activities of the Transfer Agent),
and Chubb Investment Advisory Corporation, One Granite Place, Concord, New
Hampshire 03301 (all books and records not maintained by the Company's
Custodian, Investment Manager, Distributor or Transfer Agent).
Item 31. Management Services
Not applicable
Item 32. Undertakings
Not applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant certifies that it meets all of the
requirements for effectiveness of this Amended Registration Statement pursuant
to Rule 485(b) under the Securities Act of 1933 and has duly caused this Amended
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Warren, and State of New Jersey, on the 1st day
of April 1996.
CHUBB INVESTMENT FUNDS INC.
By */s/MICHAEL O'REILLY
--------------------
Michael O'Reilly, President
POWER OF ATTORNEY
Each of the undersigned Officers and Directors of Chubb Investment Funds, Inc.
(the "Company") whose signatures appear below hereby makes, constitutes and
appoints Shari J. Lease, Ronald Angarella and Charles C. Cornelio, and each of
them acting individually, his/her true and lawful attorneys with power to act
without any other and with full power of substitution, to execute, deliver and
file in each of the undersigned Officers' and Directors' capacity or capacities
as shown below, this Registration Statement and any and all documents in support
of this Registration Statement or supplement thereto, and any and all
amendments, including any and all post-effective amendments to the foregoing;
and said Officers and Directors hereby grants to said attorneys, and to any one
or more of them, full power and authority to do and perform each and every act
and thing whatsoever as said attorney or attorneys may deem necessary or
advisable to carry out fully the intent of this Power of Attorney to the same
extent and with the same effect as each of said Officers and Directors might or
could do personally in his/her capacity or capacities as aforesaid, and each of
said Officers and Directors ratifies, confirms and approves all acts and things
which said attorneys or attorney might do or cause to be done by virtue of this
Power of Attorney and his/her signature as the same may be signed by said
attorney or attorneys, or any one or
C-16
<PAGE>
more of them to this Registration Statement and any and all amendments thereto,
including any and all post-effective amendments to the foregoing.
C-17
<PAGE>
Name Title Date
/s/ MICHAEL O'REILLY President, Principal April 1, 1996
- --------------------------------- Executive Officer
Michael O'Reilly and Director
/s/ RONALD R. ANGARELLA Senior Vice President April 1, 1996
- --------------------------------- and Director
Ronald R. Angarella
/s/ Director April 1, 1996
- ---------------------------------
James J. Weisbart
* Director April 1, 1996
- ---------------------------------
Michael D. Coughlin
* Director April 1, 1996
- ---------------------------------
Elizabeth S. Hager
/s/ JOHN A. WESTON Treasurer, Principal April 1, 1996
- --------------------------------- Financial Officer
John A. Weston and Principal
Accounting Officer
*By
/s/ RONALD R. ANGARELLA
------------------------------
Ronald R. Angarella, attorney-in-fact
C-18
<PAGE>
<TABLE>
<CAPTION>
Exhibit Sequentially
Number Description Numbered Page
- ------ ----------- -------------
<S> <C> <C>
Exhibit 27.1
99.1 Consent of Ernst & Young LLP
99.2 Stock Subscription Agreement between Chubb
Investment Funds and Chubb Life Insurance
Company of America.
99.3 Fee Table Information and Schedule of
Computation Quotation
99.4 Diagram of Subsidiaries of The Chubb
Corporation
99.5 Price Make-up Sheet.
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 1
<NAME> CHUBB MONEY MARKET FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 7352792
<INVESTMENTS-AT-VALUE> 7352792
<RECEIVABLES> 20660
<ASSETS-OTHER> 265877
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 7639329
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 19123
<TOTAL-LIABILITIES> 19123
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 7620967
<SHARES-COMMON-STOCK> 7620969
<SHARES-COMMON-PRIOR> 7495527
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (761)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 7620206
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 424411
<OTHER-INCOME> 0
<EXPENSES-NET> 38146
<NET-INVESTMENT-INCOME> 386265
<REALIZED-GAINS-CURRENT> 21
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 386286
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 386265
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 7359452
<NUMBER-OF-SHARES-REDEEMED> 7590914
<SHARES-REINVESTED> 356904
<NET-CHANGE-IN-ASSETS> 125,463
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (782)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 38,242
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 100024
<AVERAGE-NET-ASSETS> 7647228
<PER-SHARE-NAV-BEGIN> 1.0
<PER-SHARE-NII> .05
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> .05
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1
<EXPENSE-RATIO> .50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 2
<NAME> CHUBB GOVERNMENT SECURITIES FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 12974756
<INVESTMENTS-AT-VALUE> 13497731
<RECEIVABLES> 142357
<ASSETS-OTHER> 268856
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 13908944
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 22466
<TOTAL-LIABILITIES> 22466
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 13866071
<SHARES-COMMON-STOCK> 1287696
<SHARES-COMMON-PRIOR> 1286086
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (502568)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 522975
<NET-ASSETS> 13886478
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 974774
<OTHER-INCOME> 0
<EXPENSES-NET> 135818
<NET-INVESTMENT-INCOME> 838956
<REALIZED-GAINS-CURRENT> 129275
<APPREC-INCREASE-CURRENT> 1222240
<NET-CHANGE-FROM-OPS> 2190471
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 838956
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 260999
<NUMBER-OF-SHARES-REDEEMED> 323982
<SHARES-REINVESTED> 64593
<NET-CHANGE-IN-ASSETS> 1351838
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (631843)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 88605
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 231363
<AVERAGE-NET-ASSETS> 13622659
<PER-SHARE-NAV-BEGIN> 9.75
<PER-SHARE-NII> .64
<PER-SHARE-GAIN-APPREC> 1.030
<PER-SHARE-DIVIDEND> .64
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.78
<EXPENSE-RATIO> 1.00
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 3
<NAME> CHUBB TOTAL RETURN FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 18582821
<INVESTMENTS-AT-VALUE> 21733279
<RECEIVABLES> 393955
<ASSETS-OTHER> 119076
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 22246310
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 74984
<TOTAL-LIABILITIES> 74984
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 19236652
<SHARES-COMMON-STOCK> 1388932
<SHARES-COMMON-PRIOR> 1241886
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (80)
<OVERDISTRIBUTION-GAINS> (215704)
<ACCUM-APPREC-OR-DEPREC> 3150458
<NET-ASSETS> 22171326
<DIVIDEND-INCOME> 317232
<INTEREST-INCOME> 378020
<OTHER-INCOME> 593
<EXPENSES-NET> 213911
<NET-INVESTMENT-INCOME> 481934
<REALIZED-GAINS-CURRENT> 908600
<APPREC-INCREASE-CURRENT> 3699707
<NET-CHANGE-FROM-OPS> 5090241
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 481934
<DISTRIBUTIONS-OF-GAINS> 1123860
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 251919
<NUMBER-OF-SHARES-REDEEMED> 259566
<SHARES-REINVESTED> 154693
<NET-CHANGE-IN-ASSETS> 5740131
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (524)
<GROSS-ADVISORY-FEES> 128231
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 335826
<AVERAGE-NET-ASSETS> 19706755
<PER-SHARE-NAV-BEGIN> 13.23
<PER-SHARE-NII> .37
<PER-SHARE-GAIN-APPREC> 3.59
<PER-SHARE-DIVIDEND> .37
<PER-SHARE-DISTRIBUTIONS> .86
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 15.96
<EXPENSE-RATIO> 1.08
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 4
<NAME> CHUBB TAX-EXEMPT FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 13751674
<INVESTMENTS-AT-VALUE> 14749807
<RECEIVABLES> 266359
<ASSETS-OTHER> 255844
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 15272010
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 12661
<TOTAL-LIABILITIES> 12661
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 14275494
<SHARES-COMMON-STOCK> 1237682
<SHARES-COMMON-PRIOR> 1245033
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (14278)
<ACCUM-APPREC-OR-DEPREC> 998133
<NET-ASSETS> 15259349
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 917028
<OTHER-INCOME> 0
<EXPENSES-NET> 147228
<NET-INVESTMENT-INCOME> 769800
<REALIZED-GAINS-CURRENT> 9393
<APPREC-INCREASE-CURRENT> 1383807
<NET-CHANGE-FROM-OPS> 2163000
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 769800
<DISTRIBUTIONS-OF-GAINS> 26426
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 271827
<NUMBER-OF-SHARES-REDEEMED> 343636
<SHARES-REINVESTED> 64458
<NET-CHANGE-IN-ASSETS> 1285410
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 1377
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 96363
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 264842
<AVERAGE-NET-ASSETS> 14814578
<PER-SHARE-NAV-BEGIN> 11.22
<PER-SHARE-NII> 0.62
<PER-SHARE-GAIN-APPREC> 1.13
<PER-SHARE-DIVIDEND> 0.62
<PER-SHARE-DISTRIBUTIONS> 0.02
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.33
<EXPENSE-RATIO> 1.00
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 5
<NAME> CHUBB GROWTH AND INCOME FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 23725919
<INVESTMENTS-AT-VALUE> 28904876
<RECEIVABLES> 111420
<ASSETS-OTHER> 166705
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 29183001
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 38840
<TOTAL-LIABILITIES> 38840
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 24471321
<SHARES-COMMON-STOCK> 1568900
<SHARES-COMMON-PRIOR> 1264419
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (221)
<OVERDISTRIBUTION-GAINS> (505896)
<ACCUM-APPREC-OR-DEPREC> 5178957
<NET-ASSETS> 29144161
<DIVIDEND-INCOME> 536757
<INTEREST-INCOME> 28460
<OTHER-INCOME> 3261
<EXPENSES-NET> 270866
<NET-INVESTMENT-INCOME> 297612
<REALIZED-GAINS-CURRENT> 1290658
<APPREC-INCREASE-CURRENT> 5697972
<NET-CHANGE-FROM-OPS> 7286242
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 297589
<DISTRIBUTIONS-OF-GAINS> 1794895
<DISTRIBUTIONS-OTHER> 1903
<NUMBER-OF-SHARES-SOLD> 360343
<NUMBER-OF-SHARES-REDEEMED> 239731
<SHARES-REINVESTED> 183869
<NET-CHANGE-IN-ASSETS> 10464933
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 161896
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 419662
<AVERAGE-NET-ASSETS> 24876309
<PER-SHARE-NAV-BEGIN> 14.77
<PER-SHARE-NII> 0.20
<PER-SHARE-GAIN-APPREC> 5.04
<PER-SHARE-DIVIDEND> .2
<PER-SHARE-DISTRIBUTIONS> 1.23
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 18.58
<EXPENSE-RATIO> 1.08
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 6
<NAME> CHUBB CAPITAL APPRECIATION FUND
<S> <C>
<PERIOD-TYPE> 4-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 1056046
<INVESTMENTS-AT-VALUE> 1078463
<RECEIVABLES> 34366
<ASSETS-OTHER> 503101
<OTHER-ITEMS-ASSETS> 12505
<TOTAL-ASSETS> 1628435
<PAYABLE-FOR-SECURITIES> 18200
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 13981
<TOTAL-LIABILITIES> 32181
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1573837
<SHARES-COMMON-STOCK> 153462
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 22417
<NET-ASSETS> 1596254
<DIVIDEND-INCOME> 4581
<INTEREST-INCOME> 6232
<OTHER-INCOME> 0
<EXPENSES-NET> 5104
<NET-INVESTMENT-INCOME> 5709
<REALIZED-GAINS-CURRENT> 3429
<APPREC-INCREASE-CURRENT> 22417
<NET-CHANGE-FROM-OPS> 31555
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 5709
<DISTRIBUTIONS-OF-GAINS> 3429
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 152567
<NUMBER-OF-SHARES-REDEEMED> 18
<SHARES-REINVESTED> 913
<NET-CHANGE-IN-ASSETS> 1596254
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 2714
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 33176
<AVERAGE-NET-ASSETS> 1252799
<PER-SHARE-NAV-BEGIN> 10
<PER-SHARE-NII> .04
<PER-SHARE-GAIN-APPREC> .42
<PER-SHARE-DIVIDEND> .04
<PER-SHARE-DISTRIBUTIONS> .02
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.4
<EXPENSE-RATIO> 1.25
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 7
<NAME> CHUBB GLOBAL INCOME FUND
<S> <C>
<PERIOD-TYPE> 4-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 9527799
<INVESTMENTS-AT-VALUE> 9829559
<RECEIVABLES> 269030
<ASSETS-OTHER> 1604379
<OTHER-ITEMS-ASSETS> 12505
<TOTAL-ASSETS> 11715473
<PAYABLE-FOR-SECURITIES> 951826
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 58085
<TOTAL-LIABILITIES> 1009911
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 10438566
<SHARES-COMMON-STOCK> 1048603
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (10823)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 277819
<NET-ASSETS> 10705562
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 166560
<OTHER-INCOME> 0
<EXPENSES-NET> 46680
<NET-INVESTMENT-INCOME> 119880
<REALIZED-GAINS-CURRENT> (10794)
<APPREC-INCREASE-CURRENT> 277819
<NET-CHANGE-FROM-OPS> 386905
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 119880
<DISTRIBUTIONS-OF-GAINS> 29
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1037138
<NUMBER-OF-SHARES-REDEEMED> 17
<SHARES-REINVESTED> 11482
<NET-CHANGE-IN-ASSETS> 10705562
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 00
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 17451
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 73179
<AVERAGE-NET-ASSETS> 8123894
<PER-SHARE-NAV-BEGIN> 10
<PER-SHARE-NII> .12
<PER-SHARE-GAIN-APPREC> .21
<PER-SHARE-DIVIDEND> .12
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.21
<EXPENSE-RATIO> 1.75
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<PAGE>
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the references to our firm under the captions "Financial
Highlights" in the Prospectus and "Independent Auditors" in the Statement of
Additional Information and to the use of our report dated February 16, 1996,
incorporated by reference in Post-Effective Amendment Number 11 to the
Registration Statement (Form N-1A No. 33-14737) of Chubb Investment Funds, Inc.
ERNST & YOUNG LLP
Boston, Massachusetts
March 27, 1996
<PAGE>
EXHIBIT 99.2
STOCK SUBSCRIPTION AGREEMENT
<PAGE>
EXHIBIT 99.2
STOCK SUBSCRIPTION AGREEMENT
THIS AGREEMENT is entered into by and between Chubb Life Insurance Company
of America (hereinafter "Chubb Life"), a stock life insurance company existing
under and by virtue of the laws of the State of New Hampshire, and the Chubb
Investment Funds, Inc. (hereinafter "the Fund"), a corporation organized and
existing under and by virtue of the laws of the State of Maryland.
In consideration of the mutual promises set forth herein, the parties agree
as follows:
1. The Fund agrees to sell to Chubb Life, and Chubb Life hereby subscribes
to purchase up to 10,000 Shares of Stock of the Capital Appreciation Fund at
$.01 Par Value and 10,000 Shares of Stock of the Global Income Fund at $.01 Par
Value.
2. Chubb Life agrees to pay for at least one share at some time on or
before the effective date of the update amendment required by Item 32 to the
registration statement filed by the Fund on Form N-1A and to purchase and pay
for such additional Shares it desires when Chubb Life in its sole discretion
deems desirable.
3. Chubb Life acknowledges that the Shares have not been, and will not be,
registered under any state or federal securities laws and that, therefore, the
Fund is relying on certain exemptions therein from such registration
requirements, including exemptions dependent on the intent of the undersigned in
acquiring the Shares. Chubb Life also understands that any resale of the Shares,
or any part thereof, may be subject to restrictions under state and federal
securities laws, and that Chubb Life may be required to bear the economic risk
of an investment in the Shares for an indefinite period of time.
4. Chubb Life represents and warrants that it is acquiring the Shares
solely for its own account and solely for investment purposes and not with a
view to the resale or disposition of all or any part thereof, and that it has no
present plan or intention to sell or otherwise dispose of the Shares or any part
thereof; and
5. Chubb Life agrees that it will not sell or dispose of the Shares or any
part thereof unless registration statements with respect to such Shares are then
in effect under the Securities Act of 1933 and under any applicable state
securities laws or unless the undersigned shall have delivered to the Fund an
opinion of counsel acceptable to the Fund, in form and substance acceptable to
the Fund, that no such registration is necessary.
<PAGE>
6. Chubb Life further agrees to withdraw any request to redeem any of the
Shares to the extent the Fund informs the undersigned that the effect of such
redemption could be to reduce the Fund's net worth below $100,000.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement by
their duly authorized representatives this day of , 1995.
CHUBB LIFE INSURANCE COMPANY
OF AMERICA
By:
Title:
CHUBB INVESTMENT FUNDS, INC.
By:
Title:
<PAGE>
EXHIBIT 99.3
FEE TABLE INFORMATION AND SCHEDULE OF
COMPUTATION QUOTATION
<PAGE>
CHUBB INVESTMENT FUNDS
MONEY MARKET PORTFOLIO
7 DAY YIELD
.50% NET NET ASSETS DAILY
DATE INCOME EXPENSES INCOME AT MARKET YIELD
12/23/95 1,116.48 107.53 1,008.95 8,022,423.330 0.00012577
12/24/95 1,116.48 107.53 1,008.95 8,022,423.330 0.00012577
12/25/95 1,116.48 107.53 1,008.95 8,022,423.330 0.00012577
12/26/95 1,137.25 117.00 1,020.25 7,452,654.500 0.00013690
12/27/95 1,064.12 102.1 962.02 7,587,525.600 0.00012679
12/28/95 1,076.67 103.94 972.73 7,586,419.250 0.00012822
12/29/95 1,076.56 103.93 972.63 7,591,506.110 0.00012812
7 DAY YIELD: 4.68%
7 DAY EFFECTIVE YIELD: 4.79%
FORMULA:
7 DAY YEILD @SUM(L11..L17)/7*365
7 DAY EFFECTIVE YIELD:((1+@SUM(L11..L17)) (365/7)-1)
<PAGE>
CHUBB INVESTMENT FUNDS
MONEY MARKET PORTFOLIO
7 DAY YIELD
1.31% NET NET ASSETS DAILY
DATE INCOME EXPENSES INCOME AT MARKET YIELD
12/23/95 1,116.48 281.73 834.75 8,022,423.330 0.00010405
12/24/95 1,116.48 281.73 834.75 8,022,423.330 0.00010405
12/25/95 1,116.48 281.73 834.75 8,022,423.330 0.00010405
12/26/95 1,137.25 306.54 830.71 7,452,654.500 0.00011146
12/27/95 1,064.12 267.50 796.62 7,587,525.600 0.00010499
12/28/95 1,076.67 272.32 804.35 7,586,419.250 0.00010602
12/29/95 1,076.56 272.30 804.26 7,591,506.110 0.00010594
7 DAY YIELD: 3.86%
7 DAY EFFECTIVE YIELD: 3.94%
FORMULA: 7 DAY YEILD @SUM(L11..L17)/7*365
7 DAY EFFECTIVE YIELD:((1+@SUM(L11..L17)) (365/7)-1)
<PAGE>
Chubb Government Fund
30 Day Yield
11/30/95 - 12/29/95
Calculation without assumed expenses (Actual 1995 Expense Ratio of 1.70%)
Income $86,998.98
Expenses ($17,517.07)
Ave Daily Shares Eligible for Dist. 1,284,016.111
Offering Price at End of Period $11.11
30 Day Yield 5.92%
2*((((86998.98-17517.07)/(1284016.111*11.11)+1)^6)-1)
Chubb Government Fund
30 Day Yield
11/30/95 - 12/29/95
1% Expense
Income $86,998.98
Expenses ($10,933.98)
Ave Daily Shares Eligible for Dist. 1,284,016.111
Offering Price at End of Period $11.11
30 Day Yield 6.48%
2*((((86998.98-10933.98)/(1284016.111*11.11)+1)^6)-1)
<PAGE>
Chubb Tax-Exempt Fund
30 Day Yield
11/30/95 - 12/29/95
Calculation without assumed expenses (Actual 1995 Expense Ratio of 1.79%)
Income $67,238.69
Expenses ($20,570.32)
Ave Daily Shares Eligible for Dist. 1,233,384.824
Offering Price at End of Period $12.71
30 Day Yield 3.60%
2*((((67238.69-20570.32)/(1233384.824*12.71)+1) 6)-1)
===============================================================================
Chubb Tax-Exempt Fund
30 Day Yield
11/30/95 - 12/29/95
1% Expense
Income $67,238.69
Expenses ($12,065.81)
Ave Daily Shares Eligible for Dist. 1,233,384.824
Offering Price at End of Period $12.71
30 Day Yield 4.26%
2*((((67238.69-12065.81)/(1233384.824*12.71)+1) 6)-1)
<PAGE>
Chubb Tax-Exempt Fund
30 Day Tax-Equivalent Yield
11/30/95 - 12/29/95
Tax-Exempt Income $66,200.96
Tax-Exempt Expenses (11,879.59)
-------------
Tax-Exempt Net Income $54,321.37
Tax-Exempt Income / 1 - Tax Rate (.36) $84,877.14
Taxable Income $1,037.73
Taxable Expenses (186.22)
-------------
Taxable Net Income $851.51
Total Net Income $85,728.65
Avg Daily Shares Eligible For Dist. 1,233,384.824
Offering Price at End of Period $12.71
30 Day Yield = 6.65%
2*((((85728.65)/(1233384.824*12.71)+1)6)-1)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Chubb Tax-Exempt Fund
30 Day Tax-Equivalent Yield
11/30/95 - 12/29/95
Calculation without assumed expenses (Actual 1995 Expense Ratio of 1.79%)
Tax-Exempt Income $66,200.96
Tax-Exempt Expenses (20,252.85)
-------------
Tax-Exempt Net Income $45,948.11
Tax-Exempt Income / 1 - Tax Rate (.36) $71,793.92
Taxable Income $1,037.73
Taxable Expenses (317.47)
-------------
Taxable Net Income $720.26
Total Net Income $72,514.18
Avg Daily Shares Eligible For Dist. 1,233,384.824
Offering Price at End of Period $12.71
30 Day Yield = 5.62%
2*((((72514.18)/(1233384.824*12.71)+1)6)-1)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
Chubb Tax-Exempt Fund
30 Day Tax-Equivalent Yield
11/30/95 - 12/29/95
Tax-Exempt Income $66,200.96
Tax-Exempt Expenses (11,879.59)
-------------
Tax-Exempt Net Income $54,321.37
Tax-Exempt Income/1 - Tax Rate (.396) = $89,936.04
Taxable Income $1,037.73
Taxable Expenses (186.22)
-------------
Taxable Net Income $851.51
Total Net Income ($90,787.55)
Avg Daily Shares Eligible For Dist. 1,233,384.824
Offering Price at End of Period $12.71
30 Day Yield = 7.05%
2*((((90787.55)/1233384.824*12.71)+1) 6)-1)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Chubb Tax-Exempt Fund
30 Day Tax-Equivalent Yield
11/30/95 - 12/29/95
Calculation without assumed expenses (Actual 1995 Expense Ratio of 1.79%)
Tax-Exempt Income $66,200.96
Tax-Exempt Expenses (20,252.85)
-------------
Tax-Exempt Net Income $45,948.11
Tax-Exempt Income / 1 - Tax Rate (.396) = $76,073.03
Taxable Income $1,037.73
Taxable Expenses (317.47)
-------------
Taxable Net Income 720.26
Total Net Income $76,793.29
Avg Daily Shares Eligible For Dist. 1,233,384.824
Offering Price at End of Period $12.71
30 Day Yield = 5.95%
2*((((76793.29)/(1233384.824*12.71)+1) 6(-1)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
<TABLE>
<CAPTION>
CHUBB GOVERNMENT SECURITIES FUND
30 DAY YIELD INCOME CALCULATION
T NOTES: FOR PERIOD 12/02/95 - 12/31/95
SETTLE MARKET INTEREST
SYMBOL DATE COUPON DUE DATE QUOTE YTM VALUE RECEIVABLE DAYS HELD INCOME
- ------ ------ ------ -------- ----- --- ------ ---------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
N1112 12/01/95 10.375% 11/15/2012 136.2186 6.754% 4,256,831.25 14,251.36 30 24,039.08
N598 12/01/95 5.375% 05/31/98 99.8436 5.443% 149,765.40 4,053.36 30 697.70
N598 12/01/95 5.375% 05/31/98 99.8436 5.443% 99,843.60 2,702.24 9 139.54
N0599 12/01/95 6.750% 05/31/99 103.9061 5.507% 332,499.52 10,859.47 30 1,575.73
N0501 12/01/95 8.000% 05/15/2001 111.2812 5.573% 333,843.60 1,054.94 30 1,555.32
5,172,783.37 32,921.37 28,007.37
============ ========= =========
</TABLE>
<TABLE>
<CAPTION>
FACE
INTEREST (adj. for 1 paydown) RATE DAYS INCOME GAIN/LOSS ON PAYDOWN
- -------- -------------------- ---- ---- ------ --------------------
<S> <C> <C> <C> <C> <C>
FHLMC, CMO, 1058-H, 8.00% 652,846 8.000% 30 4,352.31
MAT: 04/15/2021
FNMA POOL # 29429, 9.00% 49,479 9.000% 30 371.09 9.61
MAT: 7/01/2001
FNMA POOL # 282883, 7.00% 223,744 7.000% 30 1,305.17 13.90
MAT: 5/01/2024
FNMA POOL # 306175, 7.00% 3,860,756 7.000% 30 22,521.08 7,675.19
MAT: 01/01/2025
GNMA POOL # 166009, 9.00% 132,990 9.000% 30 997.43 9.81
MAT: 6/15/2016
GNMA POOL # 385809, 8.500% 1,478,462 8.500% 30 10,472.44 (959.29)
MAT: 07/15/2024
GNMA POOL # 402766, 8.000% 1,598,850 8.000% 30 10,659.00 (37.44)
MAT: 08/15/2025
KPAC, CMO, 20-D, 9.900% 136,643 9.900% 30 1,127.30 (172.96)
MAT: 10/01/2018
--------- ---------
51,805.82 6,538.82
========= =========
SEE CALC. ABOVE******> 28,007.37
SWEEP - ASTRA .......................................................... 381.77
---------
86,733.78
=========
<CAPTION>
DISCOUNT EARNED (ADJUSTED FOR 1 PAYDOWN)
- -----------------------------------------
$ DAILY
-------
<S> <C> <C> <C> <C>
FHLMC, CMO, 1058 - H 12/02/95-12/31/95 (2.36) 30 (70.80)
FNMA POOL # 282883 12/02/95-12/31/95 1.24 30 37.20
FNMA POOL # 29429 12/02/95-12/31/95 0.30 30 9.00
FNMA POOL # 306175 12/02/95-12/31/95 20.85 30 625.50
GNMA POOL # 385809, 8.500% 12/02/95-12/31/95 (6.31) 30 (189.30)
GNMA POOL # 402766, 8.00% 12/02/95-12/31/95 (4.80) 30 (144.00)
GNMA POOL # 166009, 9.00% 12/02/95-12/31/95 0.82 30 24.60
KPAC, CMO, SERIES 20-D 12/02/95-12/31/95 (0.90) 30 (27.00)
----------
TOTAL DISCOUNT EARNED 265.20
----------
TOTAL INCOME FOR PERIOD $86,998.98
==========
30 DAY YEILD .............
INCOME $86,998.98
EXPENSES $10,933.98
AVG DAILY SHARES ELIGIBLE FOR DIS 1,284,016.111
OFFERING PRICE AT END OF PERIOD $11.11
30 DAY YIELD = 6.48% PREPARED BY:
2*((((86998.98-10933.98)/(1284016.111*11.11)+1) 6)-1) REVIEWED BY:
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CHUBB TAX-EXEMPT FUND
30 DAY YIELD
FOR PERIOD 11/01/95 - 11/30/95
Settlement Par Call Call Days
Date Symbol (1,000's) Coupon Maturity Date Price Held
----------- ------ --------- ------ -------- -------- ----- ----
<S> <C> <C> <C> <C> <C> <C> <C>
1 12/01/95 AAHOS $150 6.750% 10/01/02 10/01/01 102 30
2 12/01/95 ATUSP 50 7.300% 05/15/17 11/15/01 100 30
3 12/01/95 ATUSR 10 7.300% 05/15/17 11/15/01 100 30
4 12/01/95 BRAT 60 7.750% 10/01/15 10/01/98 102 30
5 12/01/95 CDPR 250 6.750% 02/01/12 05/01/02 102 30
6 12/01/95 CIGO 300 5.500% 01/01/24 01/01/06 100 30
7 12/01/95 CTGO 160 7.000% 09/15/10 09/15/00 102 30
8 12/01/95 CCIG 150 7.000% 11/01/99 30
9 12/01/95 DOCR 500 5.875% 06/01/05 30
10 12/01/95 DCCP 300 7.300% 01/01/13 01/01/03 102 30
11 12/01/95 DCGO 250 5.500% 06/01/06 30
12 12/01/95 DCGU 500 5.375% 04/01/23 04/01/03 102 2
13 12/01/95 FSBE 100 7.125% 06/01/17 06/01/96 102 30
14 12/01/95 GRDA 160 7.000% 06/01/06 06/01/97 102 30
15 12/01/95 HTXS 1,150 0.000% 08/15/13 30
16 12/01/95 IHDA 75 7.750% 08/01/23 08/01/00 102 30
17 12/01/95 ISTR 150 6.800% 06/15/14 06/15/00 102 30
18 12/01/95 ILTH 350 6.375% 01/01/15 01/01/03 102 30
19 12/01/95 IBBR 200 6.000% 02/01/15 02/01/03 102 30
20 12/01/95 IBBRA 350 6.000% 02/01/15 02/01/03 102 30
21 12/01/95 INSPW 500 5.650% 01/01/16 01/01/14 100 28
22 12/01/95 IHFA 150 7.800% 01/01/22 07/01/00 102 30
23 12/01/95 IPAV 140 7.200% 07/01/19 07/01/97 102 30
24 12/01/95 JSTR 200 6.750% 12/01/06 12/01/02 100 30
25 12/01/95 KYT2 20 7.250% 05/15/10 05/15/00 101.5 30
26 12/01/95 KYTA 140 7.250% 05/15/10 05/15/00 101.5 30
27 12/01/95 LCWP 250 7.000% 10/01/22 10/01/01 102 30
28 12/01/95 LCRA 100 7.000% 01/01/09 01/01/97 102 30
29 12/01/95 MELA 220 6.950% 12/01/07 12/01/02 102 30
30 12/01/95 MSAA 250 6.750% 09/01/12 09/01/02 102 30
31 12/01/95 MART 100 7.250% 07/01/10 07/01/98 102 30
32 12/01/95 MPEA 350 6.500% 06/15/27 06/15/03 102 30
33 12/01/95 MTNY 100 8.000% 07/01/08 07/01/98 102 30
34 12/01/95 MWAA 250 6.500% 10/01/07 10/01/02 102 30
35 12/01/95 MHEF 150 7.000% 11/15/13 11/15/01 102 30
36 12/01/95 MANY 125 7.250% 07/01/08 07/01/96 102 30
37 12/01/95 NLTB 150 6.750% 08/01/07 08/01/99 102 30
38 12/01/95 NHTR 200 6.750% 11/01/11 11/01/06 102 30
39 12/01/95 NJEDA 250 7.300% 04/01/11 04/01/01 102 30
40 12/01/95 NJWT 180 6.875% 06/15/07 06/15/00 101.8 30
41 12/01/95 NYGO 250 6.875% 02/01/02 30
42 12/01/95 NYGOH 250 5.800% 08/01/04 30
43 12/01/95 NYGA 450 5.500% 04/01/21 04/01/03 102 30
44 12/01/95 NYMC 100 8.000% 02/15/25 08/15/97 102 30
45 12/01/95 NYST 250 5.600% 04/01/10 04/01/05 102 30
46 12/01/95 NCM1P 55 7.000% 01/01/18 01/01/96 101 30
47 12/01/95 NCM1 5 7.000% 01/01/18 01/01/96 101 30
48 12/01/95 NMPA 100 7.250% 01/01/16 01/01/99 102 30
49 12/01/95 OIDA 600 5.000% 06/01/13 06/01/03 102 30
50 12/01/95 OOCE 60 7.250% 07/01/14 07/01/96 102 30
51 12/01/95 PHFA 700 5.750% 07/01/14 07/01/05 100 30
52 12/01/95 PPHH 350 5.000% 02/15/21 02/15/03 100 30
53 12/01/95 PRPC 110 6.875% 06/01/16 06/01/97 102 30
54 12/01/95 PRHP 175 8.000% 07/01/18 07/01/00 102 30
55 12/01/95 SCNJ 250 6.500% 11/15/21 11/15/01 102 30
56 12/01/95 SCPS 135 7.300% 07/01/21 07/01/96 102 30
57 12/01/95 THDA 500 5.900% 07/01/18 07/01/03 102 30
58 12/01/95 TSPF 140 7.375% 02/01/09 02/01/98 100 30
59 12/01/95 TVHA 510 5.700% 12/01/14 12/01/05 100 30
60 12/01/95 VHSD 100 6.700% 07/01/08 01/01/97 102 30
61 12/01/95 WHCF 300 6.750% 12/01/11 12/01/00 102 30
62 12/01/95 WHC2 500 6.250% 10/01/13 10/01/03 102 30
63 12/01/95 WAHF 145 7.100% 07/01/22 07/01/01 102 30
64 12/01/95 WPP2 100 7.625% 07/01/10 01/01/01 102 30
65 12/01/95 WPPS 125 7.500% 07/01/18 07/01/00 102 30
<CAPTION>
YTM/YTC or
Coupon for (Current
Settlement Market Interest Adjusted Disc Bonds Month) (Prior Month)
Date Symbol Value Recievable Quote OID Cost w/o OID Income Income Variance % Variance
------------------------------ ---------- -------- --------- -------- ------------ ------------ ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 12/01/95 AAHOS 166,954.80 1,687.80 111.3032 4.804% $675.13 $699.00 ($23.87) -0.0019%
2 12/01/95 ATUSP 57,469.70 162.24 114.9394 4.419% $212.23 $222.84 ($10.61) -0.0008%
3 12/01/95 ATUSR 11,493.94 32.48 114.9394 4.419% $42.45 $44.57 ($2.12) -0.0002%
4 12/01/95 BRAT 65,249.82 774.60 108.7497 5.058% $278.29 $293.26 ($14.97) -0.0012%
5 12/01/95 CDPR 273,067.75 1,406.40 109.2271 5.300% $1,212.26 $1,292.95 ($80.69) -0.0063%
6 12/01/95 CIGO 295,344.60 6,874.50 98.4482 5.500% $1,375.00 $1,375.00 $0.00 0.0000%
7 12/01/95 CTGO 180,974.24 2,364.36 113.1089 4.319% $659.87 $672.56 ($12.69) -0.0010%
8 12/01/95 CCIG 165,082.80 875.10 110.0552 4.188% $579.19 $606.46 ($27.26) -0.0021%
9 12/01/95 DOCR 496,055.00 14,688.00 99.2110 5.875% $2,447.92 $2,447.92 $0.00 0.0000%
10 12/01/95 DCCP 309,402.90 9,124.50 103.1343 6.954% $1,845.87 $1,858.50 ($12.63) -0.0010%
11 12/01/95 DCGO 240,928.00 6,874.20 96.3712 5.500% $1,145.83 $1,145.83 $0.00 0.0000%
12 12/01/95 DCGU 480,305.00 4,479.00 96.0610 5.375% $149.31 $2,239.58 ($2,090.28) -0.1630%
13 12/01/95 FSBE 103,717.90 3,564.00 103.7179 3.557% $318.00 $337.84 ($19.83) -0.0015%
14 12/01/95 GRDA 170,021.12 5,599.80 106.2632 3.965% $580.28 $588.68 ($8.40) -0.0007%
15 12/01/95 HTXS 436,948.25 37.9955 437,705.45 5.531% $2,017.46 $2,008.05 $9.41 0.0007%
16 12/01/95 IHDA 78,718.13 1,940.65 104.9575 6.858% $460.96 $505.34 ($44.38) -0.0035%
17 12/01/95 ISTR 167,659.20 4,702.78 111.7728 4.319% $620.36 $632.47 ($12.11) -0.0009%
18 12/01/95 ILTH 367,441.90 9,297.00 104.9834 5.741% $1,802.38 $1,851.39 ($49.01) -0.0038%
19 12/01/95 IBBR 202,086.20 4,059.20 101.0431 5.907% $1,014.75 $1,000.00 $14.75 0.0012%
20 12/01/95 IBBRA 353,650.85 6,939.00 101.0431 5.907% $1,775.00 $1,750.00 $25.00 0.0020%
21 12/01/95 INSPW 500,850.00 11,687.50 100.1700 5.634% $2,245.94 $896.92 $1,349.02 0.1053%
22 12/01/95 IHFA 159,750.00 4,875.00 106.5000 6.516% $893.91 $896.92 ($3.01) -0.0002%
23 12/01/95 IPAV 147,330.96 4,200.00 105.2364 4.947% $624.69 $635.26 ($10.57) -0.0008%
24 12/01/95 JSTR 222,586.20 6,750.00 111.2931 4.829% $922.89 $941.45 ($18.56) -0.0014%
25 12/01/95 KYT2 22,600.76 64.48 113.0038 4.318% $81.56 $85.85 ($4.29) -0.0003%
26 12/01/95 KYTA 158,205.32 451.04 113.0038 4.318% $570.90 $600.91 ($30.01) -0.0023%
27 12/01/95 LCWP 286,715.25 2,916.60 114.6861 4.419% $1,066.57 $1,085.35 ($18.78) -0.0015%
28 12/01/95 LCRA 105,101.50 2,916.00 105.1015 3.963% $356.73 $362.17 ($5.44) -0.0004%
29 12/01/95 MELA 238,133.50 7,652.88 108.2425 5.740% $1,175.68 $1,342.97 ($167.29) -0.0130%
30 12/01/95 MSAA 266,269.00 4,219.20 106.5076 5.815% $1,310.74 $1,342.97 ($32.23) -0.0025%
31 12/01/95 MART 108,420.10 3,021.00 108.4201 4.498% $417.72 $431.96 ($14.24) -0.0011%
32 12/01/95 MPEA 365,662.50 10,491.20 104.4750 5.968% $1,870.74 $1,915.90 ($45.17) -0.0035%
33 12/01/95 MTNY 111,692.50 3,333.00 111.6925 3.936% $377.28 $389.36 ($12.07) -0.0009%
34 12/01/95 MWAA 273,509.50 2,708.40 109.4038 5.100% $1,173.93 $1,194.95 ($21.02) -0.0016%
35 12/01/95 MHEF 172,386.60 466.72 114.9244 4.419% $636.53 $667.48 ($30.94) -0.0024%
36 12/01/95 MANY 129,788.88 3,775.50 103.8311 3.956% $440.32 $457.68 ($17.36) -0.0014%
37 12/01/95 NLTB 165,338.40 3,377.40 110.2256 4.218% $593.04 $605.65 ($12.61) -0.0010%
38 12/01/95 NHTR 226,057.40 1,125.00 113.0287 5.300% $1,003.39 $1,051.33 ($47.94) -0.0037%
39 12/01/95 NJEDA 264,175.50 3,042.00 105.6702 6.348% $1,413.58 $1,418.45 ($4.87) -0.0004%
40 12/01/95 NJWT 198,742.68 5,707.08 110.4126 4.654% $792.92 $844.68 ($51.76) -0.0040%
41 12/01/95 NYGO 270,264.75 5,728.80 108.1059 5.314% $1,222.19 $1,240.37 ($18.18) -0.0014%
42 12/01/95 NYGOH 254,922.00 4,833.60 101.9688 5.508% $1,192.28 $1,205.88 ($13.60) -0.0011%
43 12/01/95 NYGA 437,973.30 4,125.00 97.3274 5.500% $2,062.50 $2,062.50 $0.00 0.0000%
44 12/01/95 NYMC 108,680.30 2,355.32 108.6803 3.834% $354.76 $362.78 ($8.02) -0.0006%
45 12/01/95 NYST 256,309.75 2,333.32 102.5239 5.387% $1,161.09 $1,159.65 $1.44 0.0001%
46 12/01/95 NCM1P 55,705.32 1,603.50 101.2824 3.466% $165.53 $180.43 ($14.90) -0.0012%
47 12/01/95 NCM1 5,059.07 145.50 101.1814 4.633% $20.09 $21.29 ($1.20) -0.0001%
48 12/01/95 NMPA 107,922.70 3,021.00 107.9227 5.048% $466.70 $476.76 ($10.06) -0.0008%
49 12/01/95 OIDA 560,163.00 14,999.40 93.3605 5.000% $2,500.00 $2,500.00 $0.00 0.0000%
50 12/01/95 OOCE 62,442.06 1,812.00 104.0701 3.554% $190.30 $202.04 ($11.74) -0.0009%
51 12/01/95 PHFA 702,004.10 16,770.00 100.2863 5.710% $3,420.17 $3,354.17 $66.00 0.0051%
52 12/01/95 PPHH 320,466.65 5,152.66 91.5619 5.000% $1,458.33 $1,458.33 $0.00 0.0000%
53 12/01/95 PRPC 115,508.80 3,781.80 105.0080 4.681% $465.33 $485.06 ($19.73) -0.0015%
54 12/01/95 PRHP 205,602.60 5,833.50 117.4872 4.168% $734.39 $749.74 ($15.35) -0.0012%
55 12/01/95 SCNJ 265,765.00 722.24 106.3060 5.530% $1,228.06 $1,325.38 ($97.31) -0.0076%
56 12/01/95 SCPS 140,452.65 4,107.00 104.0390 3.654% $440.18 $466.50 ($26.32) -0.0021%
57 12/01/95 THDA 504,338.50 12,291.00 100.8677 5.967% $2,568.94 $2,458.33 $110.61 0.0086%
58 12/01/95 TSPF 149,489.06 3,441.60 106.7779 3.951% $503.52 $531.48 ($27.96) -0.0022%
59 12/01/95 TVHA 510,383.52 14,535.00 100.0752 5.690% $2,488.99 $2,422.50 $66.49 0.0052%
60 12/01/95 VHSD 103,116.80 2,791.50 103.1168 5.508% $486.12 $510.91 ($24.79) -0.0019%
61 12/01/95 WHCF 320,916.60 10,126.80 106.9722 5.490% $1,514.52 $1,553.10 ($38.58) -0.0030%
62 12/01/95 WHC2 514,749.00 5,208.60 102.9498 5.975% $2,588.96 $2,592.04 ($3.09) -0.0002%
63 12/01/95 WAHF 152,881.48 4,290.00 105.4355 6.236% $816.77 $831.23 ($14.46) -0.0011%
64 12/01/95 WPP2 116,029.30 3,177.00 116.0293 4.423% $439.37 $447.54 ($8.16) -0.0006%
65 12/01/95 WPPS 143,425.88 3,906.00 114.7407 4.319% $530.27 $540.62 ($10.35) -0.0008%
------------ ---------- ------------ ------------ ---------- ---------
MARKET VALUE: 15,130,460.82 305,317.75 30 Days Bond Income. $66,200.96 $66,983.09 ($1,678.12) -0.1309%
============ ========== 30 Days Accrued Astr 1,037.73 1,175.16 ($137.43) -0.0107%
------------ ------------ ---------- ---------
$67,238.69 $68,158.25 ($919.56) -0.0717%
============ ============ ========== =========
......30 DAY YIELD ....................
INCOME $67,238.69 $68,158.25 ($919.56) -0.0717%
EXPENSES $12,065.81 $12,410.92 ($345.11) -0.0269%
AVERAGE DAILY SHARES ELIGIBLE FOR DIST. 1,233,384.8241,237,860.809(4,475.985) -0.3489%
OFFERING PRICE AT END OF PERIOD 12.71 12.65 $0.06 0.0000%
UNDIST. INCOME PER SHARE 0 0 0
30 DAY YIELD = 4.26% 4.31% -0.05% -0.0496%
2*((((67238.69-12065.81)/(1233384.824*(12.71))+1) 6)-1)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CHUBB GLOBAL INCOME FUND
30 DAY YIELD INCOME CALCULATION
T NOTES: FOR PERIOD 11/30/95 - 12/29/95
-------
SETTLE MARKET INTEREST
SYMBOL DATE COUPON DUE DATE QUOTE YTM VALUE RECEIVABLE DAYS HELD INCOME
- ------- --------- ----------- ---------- --------- ----------- -------------------- ---------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TB111512 12/01/95 10.375% 11/15/12 136.2186 6.746% $681,093.00 $2,280.27 30 $3,841.70
TN021503 12/01/95 6.250% 02/15/03 103.0936 5.714% 526,250.00 18,342.19 30 2,593.17
TN081505 12/01/95 6.500% 08/15/05 105.2500 5.780% 484,078.42 9,538.20 30 2,377.59
$1,691,421.42 $30,160.66 $8,812.45
=================== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
FACE DAILY
INTEREST MATURITY (in local currency) RATE DAYS INCOME INCOME
- ------- -------- ------------------ ---- ---- ------ ------
<S> <C> <C> <C> <C> <C> <C>
BANNAC 11/01/97 200,000 11.000% 30 $58.85 $1,765.50
BEF0305 03/31/05 4,000,000 6.500% 30 24.45 733.50
BEF1004 10/15/04 4,000,000 7.750% 30 29.15 874.50
BTPS0502 700,000,000 12.000% 30 127.85 3,835.50
BTPS1202 420,000,000 12.000% 30 76.71 2,301.30
CAN0623 06/01/23 300,000 8.000% 30 48.26 1,447.80
CAN1198 11/01/98 200,000 8.000% 30 32.35 970.50
CEV 07/11/96 250,000 10.750% 30 71.99 2,159.70
DKK0503 05/15/03 1,050,000 8.000% 30 41.96 1,258.80
EIB4 02/26/02 41,000,000 4.625% 11 46.20 508.20
ESP0102 01/15/02 22,000,000 11.300% 30 55.63 1,668.90
ESP0602 06/15/02 24,000,000 10.300% 30 55.32 1,659.60
FINL6 01/29/02 40,000,000 6.000% 11 58.48 643.28
FRTR1008 10/25/08 1,700,000 8.500% 30 80.00 2,400.00
IBRD 03/20/03 44,000,000 4.500% 22 53.42 1,175.24
IBRD0902 09/27/02 1,050,000 6.125% 30 124.35 3,730.50
IBRD1103 11/10/03 1,050,000 5.875% 30 119.27 3,578.10
IBRD1204 42,000,000 4.750% 30 53.82 1,614.60
MAGAF5 10/15/02 300,000 5.000% 18 41.67 750.06
METGER 11/23/01 130,000 10.250% 30 35.82 1,074.60
METGER 11/23/01 90,000 10.250% 23 24.34 559.82
NLG0207 02/15/07 550,000 8.250% 30 78.34 2,350.20
NLG0907 09/15/07 550,000 8.250% 30 78.34 2,350.20
PORT0605 2,200,000 7.700% 30 93.78 2,813.40
UKT0909 09/25/09 310,000 8.000% 30 104.25 3,127.50
UKT1110 11/25/10 240,000 6.250% 30 63.06 1,891.80
----------- --------------------
$1,677.66 $47,243.10
=========== ====================
SEE CALC. ABOVE******> $8,812.45
SWEEP - ASTRA .......................................................... $1,391.21
-----------
$59,124.42
====================
<CAPTION>
DISCOUNT EARNED (ADJUSTED FOR 1 PAYDOWN)
- -----------------------------------------------
$ DAILY
----------
<S> <C> <C> <C> <C>
IBRD1204 11/30/95-12/29/96 (16.94) 30 ($508.20)
METGER 11/30/95-12/29/96 2.39 30 71.70
NLG0207 11/30/95-12/29/96 (6.68) 30 (200.40)
NLG0907 11/30/95-12/29/96 (6.25) 30 (187.50)
PORT0605 11/30/95-12/29/96 -0.09 30 (2.70)
TB111512 11/30/95-12/29/96 (7.97) 30 (239.10)
TB111512 11/30/95-12/29/96 (5.57) 30 (167.10)
TN021503 11/30/95-12/29/96 (1.20) 30 (36.00)
TN021503 11/30/95-12/29/96 (1.20) 30 (36.00)
TN021503 11/30/95-12/29/96 (0.58) 30 (17.40)
TN081505 11/30/95-12/29/96 (3.40) 30 (102.00)
UTK1110 11/30/95-12/29/96 11.83 30 354.90
-----------
TOTAL DISCOUNT EARNED ($1,069.80)
-----------
TOTAL INCOME FOR PERIOD $58,054.62
===========
30 DAY YEILD .............
INCOME $58,054.62
EXPENSES $15,213.06
AVG DAILY SHARES ELIGIBLE FOR DI 1,040,765.075
OFFERING PRICE AT END OF PERIOD $10.53
30 DAY YIELD = 4.74% PREPARED BY:
---------------------------------
2*((((58054.62-15213.06)/(1040765.075*10.53)+1) 6)-1) REVIEWED BY:
---------------------------------
</TABLE>
<PAGE>
NET CIF: GOVERNMENT SECURITIES FUND
RATE OF RETURN
1 YEAR PREPARED ON: 12/31/95
................
PURCHASE DATE: 12/31/94
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 10.05 (3% SALES LOAD)
SHARES PURCHASED: 99.50248756
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/94 9.75 12/31/94 12/31/94 0.0510
01/31/95 9.90 01/31/95 01/31/95 0.0517
02/28/95 10.12 02/28/95 02/28/95 0.0506
03/31/95 10.11 03/31/95 03/31/95 0.0513
04/30/95 10.18 04/30/95 04/30/95 0.0533
05/31/95 10.42 05/31/95 05/31/95 0.0636
06/30/95 10.49 06/30/95 06/30/95 0.0592
07/31/95 10.39 07/31/95 07/31/95 0.0573
08/31/95 10.44 08/31/95 08/31/95 0.0514
09/30/95 10.50 09/30/95 09/30/95 0.0462
10/31/95 10.58 10/31/95 10/31/95 0.0552
11/30/95 10.67 11/30/95 11/30/95 0.0456
12/31/95 10.78 12/31/95 12/31/95 0.0472
SHARES TO DATE X (NAV + NOT REINVESTED)GROSS VALUE
105.743720 10.78 1139.9173
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1139.9173 1,000.00 (139.9173)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(139.9173) 1,000.00 0.1399
ONE YEAR NET RATE OF RETURN: 13.99%
<CAPTION>
DATE CAPITAL SHARES TOTALS
DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/94 9.75 12,481,465 99.502488
01/31/95 9.90 12,729,896 5.144279 0.519624 100.022112
02/28/95 10.12 12,904,684 5.061119 0.500111 100.522222
03/31/95 10.11 12,861,485 5.156790 0.510068 101.032290
04/30/95 10.18 12,861,485 5.385021 0.528980 101.561271
05/31/95 10.42 14,054,764 6.457383 0.619710 102.180981
06/30/95 10.49 14,251,768 6.047731 0.576523 102.757505
07/31/95 10.39 n/a 5.891359 0.567022 103.324527
08/31/95 10.44 14,210,578 5.310881 0.508705 103.833232
09/30/95 10.50 13,898,853 4.797095 0.456866 104.290098
10/31/95 10.58 13,614,184 5.762025 0.544615 104.834713
11/30/95 10.67 13,659,968 4.780463 0.448028 105.282741
12/31/95 10.78 13,837,929 4.969345 0.460978 105.743720
</TABLE>
PAGE 1
<PAGE>
NET CIF: GOVERNMENT SECURITIES FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
PURCHASE DATE: 12/31/90
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 10.68 (3% SALES LOAD)
SHARES PURCHASED: 93.6329588
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<C> <C> <C> <C> <C>
12/31/90 10.36 12/31/90 12/31/90 0.0678
01/31/91 10.40 01/31/91 01/31/91 0.0639
02/28/91 10.40 02/28/91 02/28/91 0.0566
03/28/91 10.37 03/28/91 03/28/91 0.0616
04/30/91 10.40 04/30/91 04/30/91 0.0679
05/31/91 10.37 05/31/91 05/31/91 0.0656
06/28/91 10.28 06/28/91 06/28/91 0.0598
07/31/91 10.35 07/31/91 07/31/91 0.0678
08/30/91 10.55 08/30/91 08/30/91 0.0583
09/30/91 10.75 09/30/91 09/30/91 0.0599
10/31/91 10.79 10/31/91 10/31/91 0.0617
11/29/91 10.82 11/29/91 11/29/91 0.0568
12/31/91 11.16 12/31/91 12/31/91 0.0647
01/31/92 10.73 01/31/92 01/31/92 0.0613
02/28/92 10.74 02/28/92 02/28/92 0.0562
03/31/92 10.59 03/31/92 03/31/92 0.0658
04/30/92 10.60 04/30/92 04/30/92 0.0632
05/29/92 10.77 05/29/92 05/29/92 0.0632
06/30/92 10.91 06/30/92 06/30/92 0.0694
07/31/92 11.14 07/31/92 07/31/92 0.0662
08/31/92 11.18 08/31/92 08/31/92 0.0667
09/30/92 11.36 09/30/92 09/30/92 0.0636
10/31/92 11.16 10/31/92 10/31/92 0.0625
11/30/92 11.01 11/30/92 11/30/92 0.0648
12/31/92 10.70 12/31/92 12/31/92 0.0635
01/29/93 10.83 01/29/93 01/29/93 0.0584
02/26/93 10.85 02/26/93 02/26/93 0.0528
03/31/93 10.85 03/31/93 03/31/93 0.0696
04/30/93 10.88 04/30/93 04/30/93 0.0597
05/31/93 10.85 05/31/93 05/31/93 0.0550
06/30/93 10.99 06/30/93 06/30/93 0.0622
07/30/93 11.01 07/30/93 07/30/93 0.0582
08/31/93 11.08 08/31/93 08/31/93 0.0841
09/30/93 10.89 09/30/93 09/30/93 0.0763
SHARES TO DATE X (NAV + NOT REINVESTED) GROSS VALUE
139.163295 10.78 1500.1803
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1500.1803 1,000.00 (500.1803)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(500.1803) 1,000.00 0.5002
NET 5 YEAR RETURN: 50.02%
ANNUALIZED NET 5 YEAR RETURN: 8.45%
<CAPTION>
DATE CAPITAL SHARES TOTALS
DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<C> <S> <C> <C> <C> <C> <C>
12/31/90 0.0169 10.36 2,109,061 93.632959
01/31/91 0.0010 10.40 2,111,120 6.076779 0.584306 94.217264
02/28/91 10.40 2,088,553 5.332697 0.512759 94.730024
03/28/91 10.37 2,251,919 5.835369 0.562716 95.292740
04/30/91 10.40 2,777,915 6.470377 0.622152 95.914892
05/31/91 10.37 2,869,434 6.292017 0.606752 96.521644
06/28/91 10.28 2,898,860 5.771994 0.561478 97.083122
07/31/91 10.35 3,151,642 6.582236 0.635965 97.719087
08/30/91 10.55 3,662,341 5.697023 0.540002 98.259089
09/30/91 10.75 3,832,831 5.885719 0.547509 98.806598
10/31/91 10.79 3,797,675 6.096367 0.565002 99.371599
11/29/91 10.82 3,970,984 5.644307 0.521655 99.893254
12/31/91 0.0371 11.16 4,080,832 10.169133 0.911213 100.804467
01/31/92 0.0136 10.73 4,115,352 7.550255 0.703658 101.508125
02/28/92 10.74 4,421,099 5.704757 0.531169 102.039294
03/31/92 0.0120 10.59 4,668,735 7.938657 0.749637 102.788931
04/30/92 10.60 5,012,444 6.496260 0.612855 103.401786
05/29/92 10.77 5,336,478 6.534993 0.606777 104.008564
06/30/92 10.91 5,868,608 7.218194 0.661613 104.670176
07/31/92 11.14 6,352,601 6.929166 0.622008 105.292184
08/31/92 11.18 6,515,636 7.022989 0.628174 105.920358
09/30/92 11.36 6,903,738 6.736535 0.593005 106.513363
10/31/92 11.16 7,077,273 6.657085 0.596513 107.109876
11/30/92 11.01 7,108,620 6.940720 0.630401 107.740278
12/31/92 0.4549 10.70 7,392,150 55.852560 5.219865 112.960143
01/29/93 0.0270 10.83 9,645,668 9.646796 0.890748 113.850891
02/26/93 10.85 8,888,835 6.011327 0.554039 114.404930
03/31/93 10.85 9,397,484 7.962583 0.733879 115.138809
04/30/93 10.88 10,327,829 6.873787 0.631782 115.770590
05/31/93 10.85 10,747,098 6.367382 0.586856 116.357446
06/30/93 10.99 11,447,493 7.237433 0.658547 117.015993
07/30/93 11.01 12,278,489 6.810331 0.618559 117.634552
08/31/93 11.08 12,794,301 9.893066 0.892876 118.527428
09/30/93 10.89 13,388,587 9.043643 0.830454 119.357882
</TABLE>
<PAGE>
NET CIF: GOVERNMENT SECURITIES FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
<TABLE>
<S> <C> <C> <C> <C> <C>
10/31/93 11.03 10/31/93 10/31/93 0.0726
11/30/93 10.79 11/30/93 11/30/93 0.0671
12/31/93 10.71 12/31/93 12/31/93 0.0544 0.1622
01/31/94 10.80 01/31/94 01/31/94 0.0519
02/28/94 10.58 02/28/94 02/28/94 0.0507
03/31/94 10.27 03/31/94 03/31/94 0.0485
04/30/94 10.15 04/30/94 04/30/94 0.0461
05/31/94 10.13 05/31/94 05/31/94 0.0528
06/30/94 10.01 06/30/94 06/30/94 0.0502
07/29/94 10.20 07/29/94 07/29/94 0.0494
08/31/94 10.15 08/31/94 08/31/94 0.0530
09/30/94 9.89 09/30/94 09/30/94 0.0511
10/31/94 9.80 10/31/94 10/31/94 0.0514
11/30/94 9.72 11/30/94 11/30/94 0.0511
12/31/94 9.75 12/31/94 12/31/94 0.0510
01/31/95 9.90 01/31/95 01/31/95 0.0517
02/28/95 10.12 02/28/95 02/28/95 0.0506
03/31/95 10.11 03/31/95 03/31/95 0.0513
04/30/95 10.18 04/30/95 04/30/95 0.0533
05/31/95 10.42 05/31/95 05/31/95 0.0636
06/30/95 10.49 06/30/95 06/30/95 0.0592
07/31/95 10.39 07/31/95 07/31/95 0.0573
08/31/95 10.44 08/31/95 08/31/95 0.0514
09/30/95 10.50 09/30/95 09/30/95 0.0462
10/31/95 10.58 10/31/95 10/31/95 0.0552
11/30/95 10.67 11/30/95 11/30/95 0.0456
12/31/95 10.78 12/31/95 12/31/95 0.0472
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
11.03 14,193,799 8.665382 0.785619 120.143501
10.79 14,355,313 8.061629 0.747139 120.890640
10.71 14,423,056 26.184913 2.444903 123.335543
10.80 14,926,943 6.401115 0.592696 123.928239
10.58 14,636,665 6.283162 0.593872 124.522110
10.27 14,364,391 6.039322 0.588055 125.110165
10.15 13,704,395 5.767579 0.568234 125.678400
10.13 13,716,879 6.635819 0.655066 126.333466
10.01 13,685,239 6.341940 0.633560 126.967026
10.20 13,637,392 6.272171 0.614919 127.581945
10.15 13,462,232 6.761843 0.666191 128.248136
9.89 13,074,591 6.553480 0.662637 128.910773
9.80 12,700,367 6.626014 0.676124 129.586897
9.72 12,522,598 6.621890 0.681264 130.268162
9.75 12,481,465 6.643676 0.681403 130.949564
9.90 12,729,896 6.770092 0.683848 131.633412
10.12 12,904,684 6.660651 0.658167 132.291579
10.11 12,861,485 6.786558 0.671272 132.962851
10.18 12,861,485 7.086920 0.696161 133.659012
10.42 14,054,764 8.498194 0.815566 134.474578
10.49 14,251,768 7.959075 0.758730 135.233307
10.39 n/a 7.753282 0.746225 135.979533
10.44 14,210,578 6.989348 0.669478 136.649011
10.50 13,898,853 6.313184 0.601256 137.250266
10.58 13,614,184 7.583073 0.716737 137.967003
10.67 13,659,968 6.291295 0.589625 138.556627
10.78 13,837,929 6.539873 0.606667 139.163295
</TABLE>
PAGE 2
<PAGE>
NET CIF: GOVERNMENT SECURITIES FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 12/10/87
INITIAL INVESTME $1,000.00
INITIAL VALUE: 10.31 (3% SALES LOAD)
SHARES PURCHASED 96.993
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/87 10.00 12/31/87 12/31/87 0.0470
01/29/88 10.31 01/29/88 01/29/88 0.0738
02/29/88 10.36 02/29/88 02/29/88 0.0828
03/31/88 10.17 03/31/88 03/31/88 0.0789
04/29/88 10.08 04/29/88 04/29/88 0.0729
05/31/88 9.93 05/31/88 05/31/88 0.0790
06/30/88 10.09 06/30/88 06/30/88 0.0773
07/29/88 10.02 07/29/88 07/29/88 0.0715
08/31/88 9.95 08/31/88 08/31/88 0.0766
09/30/88 10.12 09/30/88 09/30/88 0.0727
10/31/88 10.25 10/31/88 10/31/88 0.0789
11/30/88 10.02 11/30/88 11/30/88 0.0760
12/30/88 9.89 12/30/88 12/30/88 0.0761
01/31/89 9.95 01/31/89 01/31/89 0.0813
02/28/89 9.84 02/28/89 02/28/89 0.0702
03/31/89 9.79 03/31/89 03/31/89 0.0794
04/28/89 9.88 04/28/89 04/28/89 0.0737
05/31/89 10.05 05/31/89 05/31/89 0.0780
06/30/89 10.29 06/30/89 06/30/89 0.0757
07/31/89 10.45 07/31/89 07/31/89 0.0771
08/31/89 10.19 08/31/89 08/31/89 0.0763
09/29/89 10.17 09/29/89 09/29/89 0.0726
10/31/89 10.36 10/31/89 10/31/89 0.0796
11/30/89 10.38 11/30/89 11/30/89 0.0729
12/29/89 10.33 12/29/89 12/29/89 0.0957
01/31/90 10.12 01/31/90 01/31/90 0.0670
02/28/90 10.09 02/28/90 02/28/90 0.0585
03/30/90 10.01 03/30/90 03/30/90 0.0735
04/30/90 9.81 04/30/90 04/30/90 0.0744
05/31/90 10.05 05/31/90 05/31/90 0.0677
06/29/90 10.16 06/29/90 06/29/90 0.0661
07/31/90 10.24 07/31/90 07/31/90 0.0781
08/31/90 10.00 08/31/90 08/31/90 0.0723
09/29/90 10.02 09/29/90 09/29/90 0.0572
SHARES TO DAX (NAV +NOT REINVESTE GROSS VALUE
189.401829 10.78 2041.7517
GROSS VALUE - INITIAL INVESTMENT NET VALUE
2041.7517 1,000.00 (1041.7517)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(1041.7517) 1,000.00 1.0418
NET RATE OF RETURN SINCE INCEPTION: 104.18%
ANNUALIZED NET RATE OF RETURN SINCE INCE 9.26%
<CAPTION>
CAPITAL SHARES TOTALS ACCOUNT
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES VALUE
<S> <C> <C> <C> <C> <C> <C> <C>
12/31/87 10.00 1,095,573 4.558681 0.455868 97.449079 974.5
01/29/99 10.31 1,142,657 7.191742 0.697550 98.146629 1,011.9
02/29/88 10.36 1,168,249 8.126541 0.784415 98.931044 1,024.9
03/31/88 10.17 1,155,055 7.805659 0.767518 99.698562 1,013.9
04/29/88 10.08 1,194,748 7.268025 0.721034 100.419596 1,012.2
05/31/88 9.93 1,188,083 7.933148 0.798907 101.218503 1,005.1
06/30/88 10.09 1,217,116 7.824190 0.775440 101.993943 1,029.1
07/29/88 10.02 1,222,930 7.292567 0.727801 102.721745 1,029.3
08/31/88 9.95 1,205,985 7.868486 0.790803 103.512547 1,029.9
09/30/88 10.12 1,252,663 7.525362 0.743613 104.256160 1,055.1
10/31/88 10.25 1,278,086 8.225811 0.802518 105.058678 1,076.9
11/30/88 10.02 1,268,821 7.984460 0.796852 105.855530 1,060.7
12/30/88 0.0391 9.89 1,269,022 12.194557 1.233019 107.088549 1,059.1
01/31/89 9.95 1,313,597 8.706299 0.875005 107.963554 1,074.2
02/28/89 9.84 1,339,978 7.579042 0.770228 108.733782 1,069.9
03/31/89 9.79 1,342,446 8.633462 0.881865 109.615647 1,073.1
04/28/89 9.88 1,364,050 8.078673 0.817679 110.433327 1,091.1
05/31/89 10.05 1,464,643 8.613799 0.857094 111.290421 1,118.5
06/30/89 10.29 1,555,183 8.424685 0.818725 112.109147 1,153.6
07/31/89 10.45 1,602,806 8.643615 0.827140 112.936287 1,180.2
08/31/89 10.19 1,584,495 8.617039 0.845637 113.781924 1,159.4
09/29/89 10.17 1,563,666 8.260568 0.812249 114.594172 1,165.4
10/31/89 10.36 1,607,667 9.121696 0.880473 115.474645 1,196.3
11/30/89 10.38 1,609,719 8.418102 0.810992 116.285637 1,207.0
12/29/89 10.33 1,597,576 11.128535 1.077303 117.362940 1,212.4
01/31/90 0.0026 10.12 1,582,259 8.167639 0.807079 118.170019 1,195.9
02/28/90 10.09 1,583,318 6.912946 0.685128 118.855147 1,199.2
03/30/90 10.01 1,629,119 8.735853 0.872713 119.727860 1,198.5
04/30/90 9.81 1,610,432 8.907753 0.908028 120.635888 1,183.4
05/31/90 10.05 1,659,028 8.167050 0.812642 121.448530 1,220.6
06/29/90 10.16 1,704,824 8.027748 0.790133 122.238662 1,241.9
07/31/90 10.24 1,743,768 9.546840 0.932309 123.170971 1,261.3
08/31/90 10.00 1,780,196 8.905261 0.890526 124.061497 1,240.6
09/29/90 10.02 1,859,779 7.096318 0.708215 124.769712 1,250.2
</TABLE>
Page 1
<PAGE>
NET CIF: GOVERNMENT SECURITIES FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<S> <C> <C> <C> <C>
10/31/90 10.09 10/31/90 10/31/90 0.0693
11/30/90 10.28 11/30/90 11/30/90 0.0634
12/31/90 10.36 12/31/90 12/31/90 0.0678
01/31/91 10.40 01/31/91 01/31/91 0.0639
02/28/91 10.40 02/28/91 02/28/91 0.0566
03/28/91 10.37 03/28/91 03/28/91 0.0616
04/30/91 10.40 04/30/91 04/30/91 0.0679
05/31/91 10.37 05/31/91 05/31/91 0.0656
06/28/91 10.28 06/28/91 06/28/91 0.0598
07/31/91 10.35 07/31/91 07/31/91 0.0678
08/30/91 10.55 08/30/91 08/30/91 0.0583
09/30/91 10.75 09/30/91 09/30/91 0.0599
10/31/91 10.79 10/31/91 10/31/91 0.0617
11/29/91 10.82 11/29/91 11/29/91 0.0568
12/31/91 11.16 12/31/91 12/31/91 0.0647
01/31/92 10.73 01/31/92 01/31/92 0.0613
02/28/92 10.74 02/28/92 02/28/92 0.0562
03/31/92 10.59 03/31/92 03/31/92 0.0658
04/30/92 10.60 04/30/92 04/30/92 0.0632
05/29/92 10.77 05/29/92 05/29/92 0.0632
06/30/92 10.91 06/30/92 06/30/92 0.0694
07/31/92 11.14 07/31/92 07/31/92 0.0662
08/31/92 11.18 08/31/92 08/31/92 0.0667
09/30/92 11.36 09/30/92 09/30/92 0.0636
10/31/92 11.16 10/31/92 10/31/92 0.0625
11/30/92 11.01 11/30/92 11/30/92 0.0648
12/31/92 10.70 12/31/92 12/31/92 0.0635
01/29/93 10.83 01/29/93 01/29/93 0.0584
02/26/93 10.85 02/26/93 02/26/93 0.0528
03/31/93 10.85 03/31/93 03/31/93 0.0696
04/30/93 10.88 04/30/93 04/30/93 0.0597
05/31/93 10.85 05/31/93 05/31/93 0.0550
06/30/93 10.99 06/30/93 06/30/93 0.0622
07/30/93 11.01 07/30/93 07/30/93 0.0582
08/31/93 11.08 08/31/93 08/31/93 0.0841
09/30/93 10.89 09/30/93 09/30/93 0.0763
10/31/93 11.03 10/31/93 10/31/93 0.0726
11/30/93 10.79 11/30/93 11/30/93 0.0671
12/31/93 10.71 12/31/93 12/31/93 0.0544
01/31/94 10.80 01/31/94 01/31/94 0.0519
02/28/94 10.58 02/28/94 02/28/94 0.0507
03/31/94 10.27 03/31/94 03/31/94 0.0485
04/30/94 10.15 04/30/94 04/30/94 0.0461
05/31/94 10.13 05/31/94 05/31/94 0.0528
06/30/94 10.01 06/30/94 06/30/94 0.0502
07/29/94 10.20 07/29/94 07/29/94 0.0494
08/31/94 10.15 08/31/94 08/31/94 0.0530
09/30/94 9.89 09/30/94 09/30/94 0.0511
10/31/94 9.80 10/31/94 10/31/94 0.0514
11/30/94 9.72 11/30/94 11/30/94 0.0511
<S> <C> <C> <C> <C> <C> <C>
10.09 1,933,758 8.646541 0.856942 125.626654 1.267.6
10.28 2,003,294 7.964730 0.774779 126.401433 1,299.4
0.0169 10.36 2,109,061 10.706201 1.033417 127.434850 1,320.2
0.0010 10.40 2,111,120 8.270522 0.795242 128.230093 1,333.6
10.40 2,088,553 7.257823 0.697868 128.927960 1,340.9
10.37 2,251,919 7.941962 0.765859 129.693820 1,344.9
10.40 2,777,915 8.806210 0.846751 130.540571 1,357.6
10.37 2,869,434 8.563461 0.825792 131.366363 1,362.3
10.28 2,898,860 7.855708 0.764174 132.130536 1,358.2
10.35 3,151,642 8.958450 0.865551 132.996087 1,376.5
10.55 3,662,341 7.753672 0.734945 133.731032 1,410.9
10.75 3,832,831 8.010489 0.745162 134.476194 1,445.6
10.79 3,797,675 8.297181 0.768970 135.245164 1,459.3
10.82 3,970,984 7.681925 0.709975 135.955138 1,471.0
0.0371 11.16 4,080,832 13.840233 1.240164 137.195303 1,531.1
0.0136 10.73 4,115,352 10.275928 0.957682 138.152985 1,482.4
10.74 4,421,099 7.764198 0.722923 138.875908 1,491.5
0.0120 10.59 4,668,735 10.804546 1.020259 139.896167 1,481.5
10.60 5,012,444 8.841438 0.834098 140.730265 1,491.7
10.77 5,336,478 8.894153 0.825827 141.556092 1,524.6
10.91 5,868,608 9.823993 0.900458 142.456550 1,554.2
11.14 6,352,601 9.430624 0.846555 143.303105 1,596.4
11.18 6,515,636 9.558317 0.854948 144.158052 1,611.7
11.36 6,903,738 9.168452 0.807082 144.965134 1,646.8
11.16 7,077,273 9.060321 0.811857 145.776991 1,626.9
11.01 7,108,620 9.446349 0.857979 146.634970 1,614.5
0.4549 10.70 7,392,150 76.015569 7.104259 153.739229 1,645.0
0.0270 10.83 9,645,668 13.129330 1.212311 154.951540 1,678.1
10.85 8,888,835 8.181441 0.754050 155.705590 1,689.4
10.85 9,397,484 10.837109 0.998812 156.704402 1,700.2
10.88 10,327,829 9.355253 0.859858 157.564260 1,714.3
10.85 10,747,098 8.666034 0.798713 158.362973 1,718.2
10.99 11,447,493 9.850177 0.896285 159.259258 1,750.3
11.01 12,278,489 9.268889 0.841861 160.101119 1,762.7
11.08 12,794,301 13.464504 1.215208 161.316327 1,787.4
10.89 13,388,587 12.308436 1.130251 162.446578 1,769.0
11.03 14,193,799 11.793622 1.069231 163.515809 1,803.6
10.79 14,355,313 10.971911 1.016859 164.532669 1,775.3
0.1622 10.71 14,423,056 35.637776 3.327523 167.860192 1,797.8
10.80 14,926,943 8.711944 0.806661 168.666854 1,821.6
10.58 14,636,665 8.551409 0.808262 169.475115 1,793.0
10.27 14,364,391 8.219543 0.800345 170.275460 1,748.7
10.15 13,704,395 7.849699 0.773369 171.048830 1,736.1
10.13 13,716,879 9.031378 0.891548 171.940377 1,741.8
10.01 13,685,239 8.631407 0.862278 172.802656 1,729.8
10.20 13,637,392 8.536451 0.836907 173.639563 1,771.1
10.15 13,462,232 9.202897 0.906689 174.546252 1,771.6
9.89 13,074,591 8.919313 0.901852 175.448104 1,735.2
9.80 12,700,367 9.018033 0.920207 176.368311 1,728.4
9.72 12,522,598 9.012421 0.927204 177.295515 1,723.3
</TABLE>
PAGE 2
<PAGE>
NET CIF: GOVERNMENT SECURITIES FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
..............
<TABLE>
<S> <C> <C> <C> <C>
12/31/94 9.75 12/31/94 12/31/94 0.0510
01/31/95 9.90 01/31/95 01/31/95 0.0517
02/28/95 10.12 02/28/95 02/28/95 0.0506
03/31/95 10.11 03/31/95 03/31/95 0.0513
04/30/95 10.18 04/30/95 04/30/95 0.0533
05/31/95 10.42 05/31/95 05/31/95 0.0636
06/30/95 10.49 06/30/95 06/30/95 0.0592
07/31/95 10.39 07/31/95 07/31/95 0.0573
08/31/95 10.44 08/31/95 08/31/95 0.0514
09/30/95 10.50 09/30/95 09/30/95 0.0462
10/31/95 10.58 10/31/95 10/31/95 0.0552
11/30/95 10.67 11/30/95 11/30/95 0.0456
12/31/95 10.78 12/31/95 12/31/95 0.0472
<S> <C> <C> <C> <C> <C> <C>
12/31/94 9.75 12,481,465 9.042071 0.927392 178.222907 1,737.7
01/31/95 9.90 12,729,896 9.214124 0.930720 179.153627 1,773.6
02/28/95 10.12 12,904,684 9.065174 0.895768 180.049395 1,822.1
03/31/95 10.11 12,861,485 9.236534 0.913604 180.962998 1,829.5
04/30/95 10.18 12,861,485 9.645328 0.947478 181.910477 1,851.8
05/31/95 10.42 14,054,764 11.566078 1.109988 183.020465 1,907.1
06/30/95 10.49 14,251,768 10.832334 1.032634 184.053099 1,930.7
07/31/95 10.39 n/a 10.552249 1.015616 185.068715 1,922.9
08/31/95 10.44 14,210,578 9.512532 0.911162 185.979877 1,941.6
09/30/95 10.50 13,898,853 8.592270 0.818311 186.798189 1,961.4
10/31/95 10.58 13,614,184 10.320594 0.975481 187.773670 1,986.6
11/30/95 10.67 13,659,968 8.562479 0.802482 188.576152 2,012.1
12/31/95 10.78 13,837,929 8.900794 0.825677 189.401829 2,041.8
</TABLE>
PAGE 3
<PAGE>
GROSS CIF: GOVERNMENT SECURITIES FUND
RATE OF RETURN
1 YEAR PREPARED ON: 12/31/95
................
PURCHASE DATE: 12/31/94
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 9.75
SHARES PURCHASED: 102.5641026
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/94 9.75 12/31/94 12/31/94 0.0510
01/31/95 9.90 01/31/95 01/31/95 0.0517
02/28/95 10.12 02/28/95 02/28/95 0.0506
03/31/95 10.11 03/31/95 03/31/95 0.0513
04/30/95 10.18 04/30/95 04/30/95 0.0533
05/31/95 10.42 05/31/95 05/31/95 0.0636
06/30/95 10.49 06/30/95 06/30/95 0.0592
07/31/95 10.39 07/31/95 07/31/95 0.0573
08/31/95 10.44 08/31/95 08/31/95 0.0514
09/30/95 10.50 09/30/95 09/30/95 0.0462
10/31/95 10.58 10/31/95 10/31/95 0.0552
11/30/95 10.67 11/30/95 11/30/95 0.0456
12/31/95 10.78 12/31/95 12/31/95 0.0472
SHARES TO DATE X (NAV + NOT REINVESTED) GROSS VALUE
108.997372 10.78 1174.9917
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1174.9917 1,000.00 (174.9917)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(174.9917) 1,000.00 0.1750
ONE YEAR NET RATE OF RETURN: 17.50%
<CAPTION>
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <S> <C> <C> <C> <C> <C>
12/31/94 9.75 12,481,465 102.564103
01/31/95 9.90 12,729,896 5.302564 0.535613 103.099715
02/28/95 10.12 12,904,684 5.216846 0.515499 103.615214
03/31/95 10.11 12,861,485 5.315460 0.525763 104.140976
04/30/95 10.18 12,861,485 5.550714 0.545257 104.686233
05/31/95 10.42 14,054,764 6.656072 0.638778 105.325012
06/30/95 10.49 14,251,768 6.233815 0.594263 105.919274
07/31/95 10.39 n/a 6.072631 0.584469 106.503743
08/31/95 10.44 14,210,578 5.474292 0.524358 107.028101
09/30/95 10.50 13,898,853 4.944698 0.470924 107.499024
10/31/95 10.58 13,614,184 5.939318 0.561372 108.060396
11/30/95 10.67 13,659,968 4.927554 0.461814 108.522210
12/31/95 10.78 13,837,929 5.122248 0.475162 108.997372
</TABLE>
PAGE 1
<PAGE>
GROSS CIF: GOVERNMENT SECURITIES FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
PURCHASE DATE: 12/31/90
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 10.36
SHARES PURCHASED: 96.52509653
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/90 10.36 12/31/90 12/31/90 0.0678
01/31/91 10.40 01/31/91 01/31/91 0.0639
02/28/91 10.40 02/28/91 02/28/91 0.0566
03/28/91 10.37 03/28/91 03/28/91 0.0616
04/30/91 10.40 04/30/91 04/30/91 0.0679
05/31/91 10.37 05/31/91 05/31/91 0.0656
06/28/91 10.28 06/28/91 06/28/91 0.0598
07/31/91 10.35 07/31/91 07/31/91 0.0678
08/30/91 10.55 08/30/91 08/30/91 0.0583
09/30/91 10.75 09/30/91 09/30/91 0.0599
10/31/91 10.79 10/31/91 10/31/91 0.0617
11/29/91 10.82 11/29/91 11/29/91 0.0568
12/31/91 11.16 12/31/91 12/31/91 0.0647
01/31/92 10.73 01/31/92 01/31/92 0.0613
02/28/92 10.74 02/28/92 02/28/92 0.0562
03/31/92 10.59 03/31/92 03/31/92 0.0658
04/30/92 10.60 04/30/92 04/30/92 0.0632
05/29/92 10.77 05/29/92 05/29/92 0.0632
06/30/92 10.91 06/30/92 06/30/92 0.0694
07/31/92 11.14 07/31/92 07/31/92 0.0662
08/31/92 11.18 08/31/92 08/31/92 0.0667
09/30/92 11.36 09/30/92 09/30/92 0.0636
10/31/92 11.16 10/31/92 10/31/92 0.0625
11/30/92 11.01 11/30/92 11/30/92 0.0648
12/31/92 10.70 12/31/92 12/31/92 0.0635
01/29/93 10.83 01/29/93 01/29/93 0.0584
02/26/93 10.85 02/26/93 02/26/93 0.0528
03/31/93 10.85 03/31/93 03/31/93 0.0696
04/30/93 10.88 04/30/93 04/30/93 0.0597
05/31/93 10.85 05/31/93 05/31/93 0.0550
06/30/93 10.99 06/30/93 06/30/93 0.0622
07/30/93 11.01 07/30/93 07/30/93 0.0582
08/31/93 11.08 08/31/93 08/31/93 0.0841
09/30/93 10.89 09/30/93 09/30/93 0.0763
SHARES TO DATE X (NAV + NOT REINVESTED) GROSS VALUE
143.461775 10.78 1546.5179
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1546.5179 1,000.00 (546.5179)
NET VALUE / INITIAL INVESTMENT GROSS RATE OF RETURN
(546.5179) 1,000.00 0.5465
GROSS 5 YEAR RETURN: 54.65%
ANNUALIZED GROSS 5 YEAR RETURN: 9.11%
<CAPTION>
DATE CAPITAL SHARES TOTALS
DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/90 0.0169 10.36 2,109,061 96.525097
01/31/91 0.0010 10.40 2,111,120 6.264479 0.602354 97.127450
02/28/91 10.40 2,088,553 5.497414 0.528597 97.656048
03/28/91 10.37 2,251,919 6.015613 0.580098 98.236145
04/30/91 10.40 2,777,915 6.670234 0.641369 98.877514
05/31/91 10.37 2,869,434 6.486365 0.625493 99.503007
06/28/91 10.28 2,898,860 5.950280 0.578821 100.081828
07/31/91 10.35 3,151,642 6.785548 0.655608 100.737437
08/30/91 10.55 3,662,341 5.872993 0.556682 101.294119
09/30/91 10.75 3,832,831 6.067518 0.564420 101.858539
10/31/91 10.79 3,797,675 6.284672 0.582453 102.440992
11/29/91 10.82 3,970,984 5.818648 0.537768 102.978760
12/31/91 0.0371 11.16 4,080,832 10.483238 0.939358 103.918118
01/31/92 0.0136 10.73 4,115,352 7.783467 0.725393 104.643511
02/28/92 10.74 4,421,099 5.880965 0.547576 105.191087
03/31/92 0.0120 10.59 4,668,735 8.183867 0.772792 105.963879
04/30/92 10.60 5,012,444 6.696917 0.631785 106.595664
05/29/92 10.77 5,336,478 6.736846 0.625520 107.221183
06/30/92 10.91 5,868,608 7.441150 0.682049 107.903232
07/31/92 11.14 6,352,601 7.143194 0.641220 108.544452
08/31/92 11.18 6,515,636 7.239915 0.647577 109.192030
09/30/92 11.36 6,903,738 6.944613 0.611322 109.803351
10/31/92 11.16 7,077,273 6.862709 0.614938 110.418289
11/30/92 11.01 7,108,620 7.155105 0.649873 111.068163
12/31/92 0.4549 10.70 7,392,150 57.577735 5.381097 116.449259
01/29/93 0.0270 10.83 9,645,668 9.944767 0.918261 117.367520
02/26/93 10.85 8,888,835 6.197005 0.571153 117.938673
03/31/93 10.85 9,397,484 8.208532 0.756547 118.695220
04/30/93 10.88 10,327,829 7.086105 0.651296 119.346516
05/31/93 10.85 10,747,098 6.564058 0.604982 119.951498
06/30/93 10.99 11,447,493 7.460983 0.678888 120.630387
07/30/93 11.01 12,278,489 7.020689 0.637665 121.268051
08/31/93 11.08 12,794,301 10.198643 0.920455 122.188507
09/30/93 10.89 13,388,587 9.322983 0.856105 123.044612
</TABLE>
PAGE 1
<PAGE>
GROSS CIF: GOVERNMENT SECURITIES FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
10/31/93 11.03 10/31/93 10/31/93 0.0726
11/30/93 10.79 11/30/93 11/30/93 0.0671
12/31/93 10.71 12/31/93 12/31/93 0.0544
01/31/94 10.80 01/31/94 01/31/94 0.0519
02/28/94 10.58 02/28/94 02/28/94 0.0507
03/31/94 10.27 03/31/94 03/31/94 0.0485
04/30/94 10.15 04/30/94 04/30/94 0.0461
05/31/94 10.13 05/31/94 05/31/94 0.0528
06/30/94 10.01 06/30/94 06/30/94 0.0502
07/29/94 10.20 07/29/94 07/29/94 0.0494
08/31/94 10.15 08/31/94 08/31/94 0.0530
09/30/94 9.89 09/30/94 09/30/94 0.0511
10/31/94 9.80 10/31/94 10/31/94 0.0514
11/30/94 9.72 11/30/94 11/30/94 0.0511
12/31/94 9.75 12/31/94 12/31/94 0.0510
01/31/95 9.90 01/31/95 01/31/95 0.0517
02/28/95 10.12 02/28/95 02/28/95 0.0506
03/31/95 10.11 03/31/95 03/31/95 0.0513
04/30/95 10.18 04/30/95 04/30/95 0.0533
05/31/95 10.42 05/31/95 05/31/95 0.0636
06/30/95 10.49 06/30/95 06/30/95 0.0592
07/31/95 10.39 07/31/95 07/31/95 0.0573
08/31/95 10.44 08/31/95 08/31/95 0.0514
09/30/95 10.50 09/30/95 09/30/95 0.0462
10/31/95 10.58 10/31/95 10/31/95 0.0552
11/30/95 10.67 11/30/95 11/30/95 0.0456
12/31/95 10.78 12/31/95 12/31/95 0.0472
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
10/31/93 11.03 14,193,799 8.933039 0.809886 123.854497
11/30/93 10.79 14,355,313 8.310637 0.770217 124.624714
12/31/93 0.1622 10.71 14,423,056 26.993713 2.520421 127.145135
01/31/94 10.80 14,926,943 6.598833 0.611003 127.756138
02/28/94 10.58 14,636,665 6.477236 0.612215 128.368353
03/31/94 10.27 14,364,391 6.225865 0.606219 128.974572
04/30/94 10.15 13,704,395 5.945728 0.585786 129.560358
05/31/94 10.13 13,716,879 6.840787 0.675300 130.235658
06/30/94 10.01 13,685,239 6.537830 0.653130 130.888788
07/29/94 10.20 13,637,392 6.465906 0.633912 131.522700
08/31/94 10.15 13,462,232 6.970703 0.686769 132.209469
09/30/94 9.89 13,074,591 6.755904 0.683105 132.892573
10/31/94 9.80 12,700,367 6.830678 0.697008 133.589581
11/30/94 9.72 12,522,598 6.826428 0.702307 134.291889
12/31/94 9.75 12,481,465 6.848886 0.702450 134.994338
01/31/95 9.90 12,729,896 6.979207 0.704970 135.699309
02/28/95 10.12 12,904,684 6.866385 0.678497 136.377805
03/31/95 10.11 12,861,485 6.996181 0.692006 137.069812
04/30/95 10.18 12,861,485 7.305821 0.717664 137.787476
05/31/95 10.42 14,054,764 8.760687 0.840757 138.628233
06/30/95 10.49 14,251,768 8.204915 0.782165 139.410398
07/31/95 10.39 n/a 7.992766 0.769275 140.179673
08/31/95 10.44 14,210,578 7.205235 0.690157 140.869829
09/30/95 10.50 13,898,853 6.508186 0.619827 141.489657
10/31/95 10.58 13,614,184 7.817299 0.738875 142.228532
11/30/95 10.67 13,659,968 6.485621 0.607837 142.836369
12/31/95 10.78 13,837,929 6.741877 0.625406 143.461775
</TABLE>
PAGE 2
<PAGE>
GROSS CIF: GOVERNMENT SECURITIES FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 12/10/87
INITIAL INVESTME $1,000.00
INITIAL VALUE: 10.00
SHARES PURCHASED 100.000
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/87 10.00 12/31/87 12/31/87 0.0470
01/29/88 10.31 01/29/88 01/29/88 0.0738
02/29/88 10.36 02/29/88 02/29/88 0.0828
03/31/88 10.17 03/31/88 03/31/88 0.0789
04/29/88 10.08 04/29/88 04/29/88 0.0729
05/31/88 9.93 05/31/88 05/31/88 0.0790
06/30/88 10.09 06/30/88 06/30/88 0.0773
07/29/88 10.02 07/29/88 07/29/88 0.0715
08/31/88 9.95 08/31/88 08/31/88 0.0766
09/30/88 10.12 09/30/88 09/30/88 0.0727
10/31/88 10.25 10/31/88 10/31/88 0.0789
11/30/88 10.02 11/30/88 11/30/88 0.0760
12/30/88 9.89 12/30/88 12/30/88 0.0761
01/31/89 9.95 01/31/89 01/31/89 0.0813
02/28/89 9.84 02/28/89 02/28/89 0.0702
03/31/89 9.79 03/31/89 03/31/89 0.0794
04/28/89 9.88 04/28/89 04/28/89 0.0737
05/31/89 10.05 05/31/89 05/31/89 0.0780
06/30/89 10.29 06/30/89 06/30/89 0.0757
07/31/89 10.45 07/31/89 07/31/89 0.0771
08/31/89 10.19 08/31/89 08/31/89 0.0763
09/29/89 10.17 09/29/89 09/29/89 0.0726
10/31/89 10.36 10/31/89 10/31/89 0.0796
11/30/89 10.38 11/30/89 11/30/89 0.0729
12/29/89 10.33 12/29/89 12/29/89 0.0957
01/31/90 10.12 01/31/90 01/31/90 0.0670
02/28/90 10.09 02/28/90 02/28/90 0.0585
03/30/90 10.01 03/30/90 03/30/90 0.0735
04/30/90 9.81 04/30/90 04/30/90 0.0744
05/31/90 10.05 05/31/90 05/31/90 0.0677
06/29/90 10.16 06/29/90 06/29/90 0.0661
07/31/90 10.24 07/31/90 07/31/90 0.0781
08/31/90 10.00 08/31/90 08/31/90 0.0723
09/29/90 10.02 09/29/90 09/29/90 0.0572
SHARES TO DATX (NAV +NOT REINVESTE GROSS VALUE
195.273285 10.78 0 2105.0460
GROSS VALUE - INITIAL INVESTMENT NET VALUE
2105.0460 1,000.00 (1105.0460)
NET VALUE / INITIAL INVESTMENT GROSS RATE OF RETURN
(1105.0460) 1,000.00 1.1050
GROSS RATE OF RETURN SINCE INCEPTION: 110.50%
ANNUALIZED GROSS RATE OF RETURN SINCE INC 9.67%
<CAPTION>
CAPITAL SHARES TOTALS ACCOUNT
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES VALUE
<S> <S> <C> <C> <C> <C> <C> <C>
12/31/87 10.00 1,095,573 4.700000 0.470000 100.470000 1,005
01/29/88 10.31 1,142,657 7.414686 0.719174 101.189174 1,043
02/29/88 10.36 1,168,249 8.378464 0.808732 101.997906 1,057
03/31/88 10.17 1,155,055 8.047635 0.791311 102.789217 1,045
04/29/88 10.08 1,194,748 7.493334 0.743386 103.532604 1,044
05/31/88 9.93 1,188,083 8.179076 0.823673 104.356277 1,036
06/30/88 10.09 1,217,116 8.066740 0.799479 105.155756 1,061
07/29/88 10.02 1,222,930 7.518637 0.750363 105.906119 1,061
08/31/88 9.95 1,205,985 8.112409 0.815317 106.721436 1,062
09/30/88 10.12 1,252,663 7.758648 0.766665 107.488101 1,088
10/31/88 10.25 1,278,086 8.480811 0.827396 108.315497 1,110
11/30/88 10.02 1,268,821 8.231978 0.821555 109.137052 1,094
12/30/88 0.0391 9.89 1,269,022 12.572588 1.271243 110.408294 1,092
01/31/89 0.0000 9.95 1,313,597 8.976194 0.902130 111.310424 1,108
02/28/89 9.84 1,339,978 7.813992 0.794105 112.104529 1,103
03/31/89 9.79 1,342,446 8.901100 0.909203 113.013732 1,106
04/28/89 9.88 1,364,050 8.329112 0.843028 113.856760 1,125
05/31/89 10.05 1,464,643 8.880827 0.883664 114.740424 1,153
06/30/89 10.29 1,555,183 8.685850 0.844106 115.584530 1,189
07/31/89 10.45 1,602,806 8.911567 0.852782 116.437312 1,217
08/31/89 10.19 1,584,495 8.884167 0.871852 117.309163 1,195
09/29/89 10.17 1,563,666 8.516645 0.837428 118.146592 1,202
10/31/89 10.36 1,607,667 9.404469 0.907767 119.054359 1,233
11/30/89 10.38 1,609,719 8.679063 0.836133 119.890492 1,244
12/29/89 10.33 1,597,576 11.473520 1.110699 121.001191 1,250
01/31/90 0.0026 10.12 1,582,259 8.420836 0.832098 121.833290 1,233
02/28/90 10.09 1,583,318 7.127247 0.706367 122.539657 1,236
03/30/90 10.01 1,629,119 9.006665 0.899767 123.439424 1,236
04/30/90 9.81 1,610,432 9.183893 0.936177 124.375600 1,220
05/31/90 10.05 1,659,028 8.420228 0.837834 125.213434 1,258
06/29/90 10.16 1,704,824 8.276608 0.814627 126.028061 1,280
07/31/90 10.24 1,743,768 9.842792 0.961210 126.989271 1,300
08/31/90 10.00 1,780,196 9.181324 0.918132 127.907403 1,279
09/29/90 10.02 1,859,779 7.316303 0.730170 128.637573 1,289
</TABLE>
PAGE 1
<PAGE>
GROSS CIF: GOVERNMENT SECURITIES FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<S> <C> <C> <C> <C>
10/31/90 10.09 10/31/90 10/31/90 0.0693
11/30/90 10.28 11/30/90 11/30/90 0.0634
12/31/90 10.36 12/31/90 12/31/90 0.0678
01/31/91 10.40 01/31/91 01/31/91 0.0639
02/28/91 10.40 02/28/91 02/28/91 0.0566
03/28/91 10.37 03/28/91 03/28/91 0.0616
04/30/91 10.40 04/30/91 04/30/91 0.0679
05/31/91 10.37 05/31/91 05/31/91 0.0656
06/28/91 10.28 06/28/91 06/28/91 0.0598
07/31/91 10.35 07/31/91 07/31/91 0.0678
08/30/91 10.55 08/30/91 08/30/91 0.0583
09/30/91 10.75 09/30/91 09/30/91 0.0599
10/31/91 10.79 10/31/91 10/31/91 0.0617
11/29/91 10.82 11/29/91 11/29/91 0.0568
12/31/91 11.16 12/31/91 12/31/91 0.0647
01/31/92 10.73 01/31/92 01/31/92 0.0613
02/28/92 10.74 02/28/92 02/28/92 0.0562
03/31/92 10.59 03/31/92 03/31/92 0.0658
04/30/92 10.60 04/30/92 04/30/92 0.0632
05/29/92 10.77 05/29/92 05/29/92 0.0632
06/30/92 10.91 06/30/92 06/30/92 0.0694
07/31/92 11.14 07/31/92 07/31/92 0.0662
08/31/92 11.18 08/31/92 08/31/92 0.0667
09/30/92 11.36 09/30/92 09/30/92 0.0636
10/31/92 11.16 10/31/92 10/31/92 0.0625
11/30/92 11.01 11/30/92 11/30/92 0.0648
12/31/92 10.70 12/31/92 12/31/92 0.0635
01/29/93 10.83 01/29/93 01/29/93 0.0584
02/26/93 10.85 02/26/93 02/26/93 0.0528
03/31/93 10.85 03/31/93 03/31/93 0.0696
04/30/93 10.88 04/30/93 04/30/93 0.0597
05/31/93 10.85 05/31/93 05/31/93 0.0550
06/30/93 10.99 06/30/93 06/30/93 0.0622
07/30/93 11.01 07/30/93 07/30/93 0.0582
08/31/93 11.08 08/31/93 08/31/93 0.0841
09/30/93 10.89 09/30/93 09/30/93 0.0763
10/31/93 11.03 10/31/93 10/31/93 0.0726
11/30/93 10.79 11/30/93 11/30/93 0.0671
12/31/93 10.71 12/31/93 12/31/93 0.0544
01/31/94 10.80 01/31/94 01/31/94 0.0519
02/28/94 10.58 02/28/94 02/28/94 0.0507
03/31/94 10.27 03/31/94 03/31/94 0.0485
04/30/94 10.15 04/30/94 04/30/94 0.0461
05/31/94 10.13 05/31/94 05/31/94 0.0528
06/30/94 10.01 06/30/94 06/30/94 0.0502
07/29/94 10.20 07/29/94 07/29/94 0.0494
08/31/94 10.15 08/31/94 08/31/94 0.0530
09/30/94 9.89 09/30/94 09/30/94 0.0511
10/31/94 9.80 10/31/94 10/31/94 0.0514
11/30/94 9.72 11/30/94 11/30/94 0.0511
<S> <C> <C> <C> <C> <C> <C> <C>
10/31/90 10.09 1,933,758 8.914584 0.883507 129.521080 1,307
11/30/90 10.28 2,003,294 8.211636 0.798797 130.319877 1,240
12/31/90 0.0169 10.36 2,109,061 11.038094 1.065453 131.385330 1,361
01/31/91 0.0010 10.40 2,111,120 8.526908 0.819895 132.205225 1,375
02/28/91 10.40 2,088,553 7.482816 0.719502 132.924727 1,382
03/28/91 10.37 2,251,919 8.188163 0.789601 133.714328 1,387
04/30/91 10.40 2,777,915 9.079203 0.873000 134.587328 1,400
05/31/91 10.37 2,869,434 8.828929 0.851391 135.438720 1,404
06/28/91 10.28 2,898,860 8.099235 0.787863 136.226583 1,400
07/31/91 10.35 3,151,642 9.236162 0.892383 137.118966 1,419
08/30/91 10.55 3,662,341 7.994036 0.757729 137.876694 1,455
09/30/91 10.75 3,832,831 8.258814 0.768262 138.644956 1,490
10/31/91 10.79 3,797,675 8.554394 0.792808 139.437764 1,505
11/29/91 10.82 3,970,984 7.920065 0.731984 140.169748 1,517
12/31/91 0.0371 11.16 4,080,832 14.269280 1.278609 141.448357 1,579
01/31/92 0.0136 10.73 4,115,352 10.594482 0.987370 142.435727 1,528
02/28/92 10.74 4,421,099 8.004888 0.745334 143.181061 1,538
03/31/92 0.0120 10.59 4,668,735 11.139487 1.051887 144.232949 1,527
04/30/92 10.60 5,012,444 9.115522 0.859955 145.092903 1,538
05/29/92 10.77 5,336,478 9.169871 0.851427 145.944331 1,572
06/30/92 10.91 5,868,608 10.128537 0.928372 146.872703 1,602
07/31/92 11.14 6,352,601 9.722973 0.872798 147.745501 1,646
08/31/92 11.18 6,515,636 9.854625 0.881451 148.626952 1,662
09/30/92 11.36 6,903,738 9.452674 0.832102 149.459054 1,698
10/31/92 11.16 7,077,273 9.341191 0.837024 150.296078 1,677
11/30/92 11.01 7,108,620 9.739186 0.884576 151.180654 1,664
12/31/92 0.4549 10.70 7,392,150 78.372051 7.324491 158.505145 1,696
01/29/93 0.0270 10.83 9,645,668 13.536339 1.249893 159.755038 1,730
02/26/93 10.85 8,888,835 8.435066 0.777425 160.532463 1,742
03/31/93 10.85 9,397,484 11.173059 1.029775 161.562238 1,753
04/30/93 10.88 10,327,829 9.645266 0.886513 162.448752 1,767
05/31/93 10.85 10,747,098 8.934681 0.823473 163.272225 1,772
06/30/93 10.99 11,447,493 10.155532 0.924070 164.196295 1,805
07/30/93 11.01 12,278,489 9.556224 0.867959 165.064254 1,817
08/31/93 11.08 12,794,301 13.881904 1.252879 166.317133 1,843
09/30/93 0.0000 10.89 13,388,587 12.689997 1.165289 167.482422 1,824
10/31/93 0.0000 11.03 14,193,799 12.159224 1.102378 168.584800 1,859
11/30/93 0.0000 10.79 14,355,313 11.312040 1.048382 169.633181 1,830
12/31/93 0.1622 10.71 14,423,056 36.742547 3.430677 173.063858 1,854
01/31/94 0.0000 10.80 14,926,943 8.982014 0.831668 173.895526 1,878
02/28/94 0.0000 10.58 14,636,665 8.816503 0.833318 174.728844 1,849
03/31/94 0.0000 10.27 14,364,391 8.474349 0.825156 175.554000 1,803
04/30/94 0.0000 10.15 13,704,395 8.093039 0.797344 176.351343 1,790
05/31/94 0.0000 10.13 13,716,879 9.311351 0.919186 177.270529 1,796
06/30/94 0.0000 10.01 13,685,239 8.898981 0.889009 178.159538 1,783
07/29/94 0.0000 10.20 13,637,392 8.801081 0.862851 179.022389 1,826
08/31/94 0.0000 10.15 13,462,232 9.488187 0.934797 179.957186 1,827
09/30/94 0.0000 9.89 13,074,591 9.195812 0.929809 180.886995 1,789
10/31/94 0.0000 9.80 12,700,367 9.297592 0.948734 181.835729 1,782
11/30/94 0.0000 9.72 12,522,598 9.291806 0.955947 182.791676 1,777
</TABLE>
PAGE 2
<PAGE>
GROSS CIF: GOVERNMENT SECURITIES FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<S> <C> <C> <C> <C>
12/31/94 9.75 12/31/94 12/31/94 0.0510
01/31/95 9.90 01/31/95 01/31/95 0.0517
02/28/95 10.12 02/28/95 02/28/95 0.0506
03/31/95 10.11 03/31/95 03/31/95 0.0513
04/30/95 10.18 04/30/95 04/30/95 0.0533
05/31/95 10.42 05/31/95 05/31/95 0.0636
06/30/95 10.49 06/30/95 06/30/95 0.0592
07/31/95 10.39 07/31/95 07/31/95 0.0573
08/31/95 10.44 08/31/95 08/31/95 0.0514
09/30/95 10.50 09/30/95 09/30/95 0.0462
10/31/95 10.58 10/31/95 10/31/95 0.0552
11/30/95 10.67 11/30/95 11/30/95 0.0456
12/31/95 10.78 12/31/95 12/31/95 0.0472
<S> <S> <C> <C> <C> <C> <C> <C>
12/31/94 0.0000 9.75 12,481,465 9.322375 0.956141 183.747817 1,792
01/31/95 0.0000 9.90 12,729,896 9.499762 0.959572 184.707389 1,829
02/28/95 0.0000 10.12 12,904,684 9.346194 0.923537 185.630926 1,879
03/31/95 0.0000 10.11 12,861,485 9.522866 0.941925 186.572851 1,886
04/30/95 0.0000 10.18 12,861,485 9.944333 0.976850 187.549701 1,909
05/31/95 0.0000 10.42 14,054,764 11.924627 1.144398 188.694099 1,966
06/30/95 0.0000 10.49 14,251,768 11.168137 1.064646 189.758745 1,991
07/31/95 0.0000 10.39 n/a 10.879369 1.047100 190.805845 1,982
08/31/95 0.0000 10.44 14,210,578 9.807420 0.939408 191.745253 2,002
09/30/95 0.0000 10.50 13,898,853 8.858631 0.843679 192.588933 2,022
10/31/95 0.0000 10.58 13,614,184 10.640533 1.005721 193.594654 2,048
11/30/95 0.0000 10.67 13,659,968 8.827916 0.827359 194.422013 2,074
12/31/95 0.0000 10.78 13,837,929 9.176719 0.851273 195.273285 2,105
</TABLE>
PAGE 3
<PAGE>
NET CIF: TOTAL RETURN FUND
RATE OF RETURN
1 YEAR PREPARED ON: 12/31/95
................
PURCHASE DATE: 12/31/94
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 13.93 (5% SALES LOAD)
SHARES PURCHASED: 71.78750897
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/94 13.23 12/31/94 01/15/95 0.0963
01/31/95 13.36 01/31/95 02/15/95
02/28/95 13.92 02/28/95 03/15/95
03/31/95 14.13 03/31/95 04/15/95 0.0996
04/30/95 14.54 04/30/95 05/15/95
05/31/95 15.10 05/31/95 06/15/95
06/30/95 15.46 06/30/95 07/15/95 0.1050
07/31/95 15.96 07/31/95 08/15/95
08/31/95 16.07 08/31/95 09/15/95
09/30/95 16.38 09/30/95 10/15/95 0.0819
10/31/95 16.17 10/31/95 11/15/95
11/30/95 16.67 11/30/95 12/15/95
12/31/95 15.96 12/31/95 12/31/95 0.0863
SHARES TO DATE X (NAV + NOT REINVESTED)GROSS VALUE
77.439038 15.96 1235.9270
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1235.9270 1,000.00 (235.9270)
ONE YEAR NET RATE OF RETURN: 23.59%
<CAPTION>
DATE CAPITAL SHARES TOTALS
DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/94 0.5156 13.42 16,431,195 71.787509
01/31/95 17,373,376 71.787509
02/28/95 17,921,746 71.787509
03/31/95 14.45 18,022,554 7.150036 0.494812 72.282321
04/30/95 18,022,554 72.282321
05/31/95 19,522,639 72.282321
06/30/95 15.91 20,061,885 7.589644 0.477036 72.759357
07/31/95 n/a 72.759357
08/31/95 20,702,746 72.759357
09/30/95 16.44 21,163,662 5.958991 0.362469 73.121826
10/31/95 20,916,516 73.121826
11/30/95 21,656,073 73.121826
12/31/95 0.8560 15.96 20,955,648 68.902697 4.317212 77.439038
</TABLE>
<PAGE>
NET CIF: TOTAL RETURN FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
PURCHASE DATE: 12/31/90
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 11.86 (5% SALES LOAD)
SHARES PURCHASED: 84.31703204
<TABLE>
<CAPTION>
DATE NAV EX-DATE PAYABLE DATE
<S> <C> <C> <C>
12/31/90 11.27 12/31/90 01/15/91
01/31/91 11.73 01/31/91 02/15/91
02/28/91 12.27 02/28/91 03/15/91
03/28/91 12.16 03/28/91 04/15/91
04/30/91 12.33 04/30/91 05/15/91
05/31/91 13.06 05/31/91 06/14/91
06/28/91 12.53 06/28/91 07/15/91
07/31/91 12.86 07/31/91 08/15/91
08/30/91 13.12 08/30/91 09/14/91
09/30/91 13.03 09/30/91 10/15/91
10/31/91 13.27 10/31/91 11/15/91
11/29/91 12.94 11/29/91 12/13/91
12/31/91 13.85 12/31/91 01/15/92
01/31/92 13.77 01/31/92 02/14/92
02/28/92 14.02 02/28/92 03/15/92
03/31/92 13.57 03/31/92 04/15/92
04/30/92 13.70 04/30/92 05/15/92
05/29/92 13.73 05/29/92 06/16/92
06/30/92 13.49 06/30/92 07/15/92
07/31/92 13.76 07/31/92 08/14/92
08/31/92 13.50 08/31/92 09/15/92
09/30/92 13.68 09/30/92 10/15/92
10/31/92 13.79 10/31/92 11/13/92
11/30/92 14.14 11/30/92 12/15/92
12/31/92 13.89 12/31/92 12/31/92
01/31/93 14.15 01/29/93 02/12/93
02/26/93 14.38 02/26/93 03/15/93
03/31/93 14.45 03/31/93 04/15/93
04/30/93 14.32 04/30/93 05/14/93
05/28/93 14.41 05/28/93 06/15/93
06/30/93 14.57 06/30/93 07/15/93
07/30/93 14.67 07/30/93 08/16/93
08/31/93 15.06 08/31/93 09/15/93
09/30/93 15.05 09/30/93 10/15/93
SHARES TO DATE X (NAV + NOT REINVESTED)
117.005245 15.96
GROSS VALUE - INITIAL INVESTMENT
1867.4037 1,000.00
NET VALUE / INITIAL INVESTMENT
(867.4037) 1,000.00
NET 5 YEAR RETURN: 86.74%
ANNUALIZED NET 5 YEAR RETURN: 13.30%
<CAPTION>
INCOME CAPITAL
DATE DISTRIBUTION DISTRIBUTIONS REINVEST NAV NET ASSETS
<S> <C> <C> <C> <C>
12/31/90 0.1215 0.0010 11.00 1,954,642
01/31/91 2,085,046
02/28/91 2,303,512
03/28/91 0.1009 0.0050 12.39 2,436,913
04/30/91 2,749,392
05/31/91 3,080,960
06/28/91 0.0920 12.72 3,191,376
07/31/91 3,727,661
08/30/91 4,145,573
09/30/91 0.1072 13.26 4,359,700
10/31/91 4,550,728
11/29/91 4,779,963
12/31/91 0.0865 0.2851 14.01 5,225,792
01/31/92 5,403,579
02/28/92 6,140,736
03/31/92 0.0842 0.1639 13.82 6,531,831
04/30/92 7,414,267
05/29/92 8,386,706
06/30/92 0.0848 13.54 8,227,266
07/31/92 8,819,903
08/31/92 13.55 8,971,058
09/30/92 0.1063 9,153,486
10/31/92 9,184,242
11/30/92 0.3733 13.89 9,250,893
12/31/92 0.1063 9,645,668
01/31/93 10,594,367
02/26/93 0.0010 14.53 10,194,748
03/31/93 0.0952 10,582,193
04/30/93 11,342,446
05/28/93 14.66 11,547,410
06/30/93 0.0929 12,183,663
07/30/93 12,948,117
08/31/93 $15.27 13,226,508
09/30/93 0.1220
GROSS VALUE
1867.4037
NET VALUE
(867.4037)
NET RATE OF RETURN
0.8674
<CAPTION>
SHARES TOTALS
DATE $ TO DIST. REINV. SHARES
<S> <C> <C> <C>
12/31/90 84.317032
01/31/91 84.317032
02/28/91 84.317032
03/28/91 8.929174 0.720676 85.037708
04/30/91 85.037708
05/31/91 85.037708
06/28/91 7.823469 0.615053 85.652760
07/31/91 85.652760
08/30/91 85.652760
09/30/91 9.181976 0.692457 86.345217
10/31/91 86.345217
11/29/91 86.345217
12/31/91 32.085883 2.290213 88.635430
01/31/92 88.635430
02/28/92 88.635430
03/31/92 21.990450 1.591205 90.226635
04/30/92 90.226635
05/29/92 90.226635
06/30/92 90.791718
07/31/92 7.651219 0.565083 90.791718
08/31/92 90.791718
09/30/92 9.651160 0.712263 91.503980
10/31/92 91.503980
11/30/92 91.503980
12/31/92 43.885309 3.159489 94.663470
01/31/93 94.663470
02/26/93 94.663470
03/31/93 9.106626 0.626746 95.290216
04/30/93 95.290216
05/28/93 95.290216
06/30/93 8.852461 0.603851 95.894067
07/30/93 95.894067
08/31/93 95.894067
09/30/93 11.699076 0.766148 96.660215
</TABLE>
<PAGE>
NET CIF: TOTAL RETURN FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
<TABLE>
<S> <C> <C> <C> <C> <C>
10/31/93 15.26 10/31/93 11/15/93
11/30/93 15.04 11/30/93 12/15/93
12/31/93 15.01 12/31/93 01/14/94 0.0950 0.4076
01/31/94 15.37 01/31/94 02/15/94
02/28/94 15.09 02/28/94 03/15/94
03/31/94 14.23 03/31/94 04/15/94 0.0965 0.2699
04/30/94 14.29 04/30/94 05/15/94
05/31/94 14.32 05/31/94 06/15/94
06/30/94 14.02 06/30/94 07/15/94 0.0937
07/29/94 14.39 07/29/94 08/15/94
08/31/94 14.80 08/31/94 09/15/94
09/30/94 14.23 09/30/94 10/15/94 0.0861
10/31/94 14.16 10/31/94 11/15/94
11/30/94 13.63 11/30/94 12/15/94
12/31/94 13.23 12/31/94 01/15/95 0.0963 0.5156
01/31/95 13.36 01/31/95 02/15/95
02/28/95 13.92 02/28/95 03/15/95
03/31/95 14.13 03/31/95 04/15/95 0.0996
04/30/95 14.54 04/30/95 05/15/95
05/31/95 15.10 05/31/95 06/15/95
06/30/95 15.46 06/30/95 07/15/95 0.1050
07/31/95 15.96 07/31/95 08/15/95
08/31/95 16.07 08/31/95 09/15/95
09/30/95 16.38 09/30/95 10/15/95 0.0819
10/31/95 16.17 10/31/95 11/15/95
11/30/95 16.67 11/30/95 12/15/95
12/31/95 15.96 12/31/95 12/31/95 0.0863 0.8560
<S> <C> <C> <C> <C> <C>
10/31/93 15.13 13,842,316 96.660215
11/30/93 14,134,348 96.660215
12/31/93 14,360,086 48.581424 3.210934 99.871149
01/31/94 14.21 15,977,490 99.871149
02/28/94 15,962,814 99.871149
03/31/94 16,099,813 36.592789 2.575143 102.446292
04/30/94 14.32 16,926,648 102.446292
05/31/94 17,098,125 102.446292
06/30/94 17,069,415 9.599218 0.670336 103.116629
07/29/94 14.33 17,451,492 103.116629
08/31/94 17,890,446 103.116629
09/30/94 17,519,760 8.878342 0.619563 103.736192
10/31/94 13.42 17,480,687 103.736192
11/30/94 17,029,828 103.736192
12/31/94 16,431,195 63.476176 4.729968 108.466160
01/31/95 14.45 17,373,376 108.466160
02/28/95 17,921,746 108.466160
03/31/95 18,022,554 10.803230 0.747628 109.213789
04/30/95 15.91 18,022,554 109.213789
05/31/95 19,522,639 109.213789
06/30/95 20,061,885 11.467448 0.720770 109.934559
07/31/95 16.44 n/a 109.934559
08/31/95 20,702,746 109.934559
09/30/95 21,163,662 9.003640 0.547667 110.482225
10/31/95 15.96 20,916,516 110.482225
11/30/95 21,656,073 110.482225
12/31/95 20,955,648 104.107401 6.523020 117.005245
</TABLE>
<PAGE>
NET CIF: TOTAL RETURN FUND
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 12/18/87
INITIAL INVESTME $1,000.00
INITIAL VALUE: 10.78 (5% SALES LOAD)
SHARES PURCHASED 92.764
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/87 10.21 12/31/87 01/14/88 0.0396
01/29/88 10.51 01/29/88 02/12/88
02/29/88 10.76 02/29/88 03/15/88
03/31/88 10.34 03/31/88 04/15/88 0.1392
04/29/88 10.50 04/29/88 05/15/88
05/31/88 10.52 05/31/88 06/15/88
06/30/88 10.92 06/30/88 07/15/88 0.0600
07/29/88 10.68 07/29/88 08/15/88
08/31/88 10.43 08/31/88 09/15/88
09/30/88 10.49 09/30/88 10/14/88 0.1672
10/31/88 10.64 10/31/88 11/15/88
11/30/88 10.56 11/30/88 12/15/88
12/30/88 10.51 12/30/88 01/13/88 0.1564
01/31/89 10.99 01/31/89 02/15/89
02/28/89 10.75 02/28/89 03/15/89
03/31/89 10.69 03/31/89 04/14/89 0.1819
04/28/89 11.08 04/28/89 05/15/89
05/31/89 11.51 05/31/89 06/15/89
06/30/89 11.32 06/30/89 07/14/89 0.1437
07/31/89 12.05 07/31/89 08/15/89
08/31/89 12.39 08/31/89 09/15/89
09/29/89 12.20 09/29/89 10/13/89 0.1451
10/31/89 11.96 10/31/89 11/15/89
11/30/89 12.35 11/30/89 12/15/89
12/29/89 12.09 12/29/89 01/15/90 0.1366
01/31/90 11.51 01/31/90 02/15/90
02/28/90 11.99 02/28/90 03/15/90
03/30/90 11.65 03/30/90 04/12/90 0.1067
04/30/90 11.40 04/30/90 05/15/90
05/31/90 12.19 05/31/90 06/15/90
06/29/90 12.10 06/29/90 07/13/90 0.1060
07/31/90 12.33 07/31/90 08/15/90
08/31/90 11.47 08/31/90 09/14/90
12/31/87
12/31/95
SHARES TO DAX (NAV +NOT REINVESTE GROSS VALUE
158.542364 15.96 2530.3361
GROSS VALUE - INITIAL INVESTMENT NET VALUE
2530.3361 1,000.00 (1530.3361)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(1530.3361) 1,000.00 1.5303
NET RATE OF RETURN SINCE INCEPTION: 153.03%
ANNUALIZED NET RATE OF RETURN SINCE INCE 12.24%
<CAPTION>
CAPITAL SHARES TOTALS ACCOUNT
DATE DISTRIBUTIONSREINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES VALUE
<S> <C> <C> <C> <C> <C> <C> <C>
12/31/87 10.34 103,470 3.673469 0.355268 93.119646 951
01/29/88 108,560 93.119646 979
02/29/88 112,138 93.119646 1,002
03/31/88 10.45 130,445 12.965048 1.240674 94.360321 976
04/29/88 221,004 94.360321 991
05/31/88 489,193 94.360321 993
06/30/88 10.72 774,433 5.661619 0.528136 94.888457 1,036
07/29/88 769,223 94.888457 1,013
08/31/88 761,510 94.888457 990
09/30/88 10.52 767,118 15.865350 1.508113 96.396570 1,011
10/31/88 795,701 96.396570 1,026
11/30/88 793,250 96.396570 1,018
12/30/88 0.0200 10.73 797,889 17.010814 1.585351 97.981921 1,030
01/31/89 896,603 97.981921 1,077
02/28/89 879,341 97.981921 1,053
03/31/89 0.0442 10.85 885,033 22.159591 2.042359 100.024279 1,069
04/28/89 975,301 100.024279 1,108
05/31/89 1,016,910 100.024279 1,151
06/30/89 11.66 1,083,180 14.368488 1.232289 101.256568 1,146
07/31/89 1,179,952 101.256568 1,220
08/31/89 1,219,238 101.256568 1,255
09/29/89 11.91 1,240,218 14.688278 1.233273 102.489841 1,250
10/31/89 1,207,108 102.489841 1,226
11/30/89 1,266,394 102.489841 1,266
12/29/89 0.3807 11.72 1,237,868 53.025681 4.524376 107.014216 1,294
01/31/90 1,219,809 107.014216 1,232
02/28/90 1,327,410 107.014216 1,283
03/30/90 0.3262 11.67 1,385,635 46.326454 3.969705 110.983921 1,293
04/30/90 1,435,375 110.983921 1,265
05/31/90 110.983921 1,353
06/29/90 12.51 1,617,895 11.764296 0.940391 111.924313 1,354
07/31/90 111.924313 1,380
08/31/90 111.924313 1,284
</TABLE>
<PAGE>
NET CIF: TOTAL RETURN FUND
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
12/31/87
12/31/95
SHARES TO DAX (NAV +NOT REINVESTE GROSS VALUE
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
09/29/90 10.98 09/29/90 10/15/90 0.1024 10.74 1,679,538 11.461050
10/31/90 10.80 10/31/90 11/15/90
11/30/90 11.27 11/30/90 12/14/90
12/31/90 11.27 12/31/90 01/15/91 0.1215 0.0010 11.00 1,954,642 13.841453
01/31/91 11.73 01/31/91 02/15/91 2,085,046
02/28/91 12.27 02/28/91 03/15/91 2,303,512
03/28/91 12.16 03/28/91 04/15/91 0.1009 0.0050 12.39 2,436,913 12.099050
04/30/91 12.33 04/30/91 05/15/91 2,749,392
05/31/91 13.06 05/31/91 06/14/91 3,080,960
06/28/91 12.53 06/28/91 07/15/91 0.0920 12.72 3,191,376 10.600818
07/31/91 12.86 07/31/91 08/15/91 3,727,661
08/30/91 13.12 08/30/91 09/14/91 4,145,573
09/30/91 13.03 09/30/91 10/15/91 0.1072 13.26 4,359,700 12.441598
10/31/91 13.27 10/31/91 11/15/91 4,550,728
11/29/91 12.94 11/29/91 12/13/91 4,779,963
12/31/91 13.85 12/31/91 01/15/92 0.0865 0.2851 14.01 5,225,792 43.476441
01/31/92 13.77 01/31/92 02/14/92 5,403,579
02/28/92 14.02 02/28/92 03/15/92 6,140,736
03/31/92 13.57 03/31/92 04/15/92 0.0842 0.1639 13.82 6,531,831 29.797108
04/30/92 13.70 04/30/92 05/15/92 7,414,267
05/29/92 13.73 05/29/92 06/16/92 8,386,706
06/30/92 13.49 06/30/92 07/15/92 0.0848 13.54 8,227,266 10.367418
07/31/92 13.76 07/31/92 08/14/92
08/31/92 13.50 08/31/92 09/15/92 8,819,903
09/30/92 13.68 09/30/92 10/15/92 0.1063 13.55 8,971,058 13.077342
10/31/92 13.79 10/31/92 11/13/92 9,153,486
11/30/92 14.14 11/30/92 12/15/92 9,184,242
12/31/92 13.89 12/31/92 12/31/92 0.1063 0.3733 13.89 9,250,893 59.464690
01/31/93 14.15 01/29/93 02/12/93 9,645,668
02/26/93 14.38 02/26/93 03/15/93 10,594,367
03/31/93 14.45 03/31/93 04/15/93 0.0952 0.0010 14.53 10,194,748 12.339498
04/30/93 14.32 04/30/93 05/14/93 10,582,193
05/28/93 14.41 05/28/93 06/15/93 11,342,446
06/30/93 14.57 06/30/93 07/15/93 0.0929 14.66 11,547,410 11.995104
07/30/93 14.67 07/30/93 08/16/93 12,183,663
08/31/93 15.06 08/31/93 09/15/93 12,948,117
09/30/93 15.05 09/30/93 10/15/93 0.1220 $15.27 13,226,508 15.852274
10/31/93 15.26 10/31/93 11/15/93 13,842,316
11/30/93 15.04 11/30/93 12/15/93 14,134,348
12/31/93 15.01 12/31/93 01/14/94 0.0950 0.4076 15.13 14,360,086 65.827936
01/31/94 15.37 01/31/94 02/15/94 15,977,490
02/28/94 15.09 02/28/94 03/15/94 15,962,814
03/31/94 14.23 03/31/94 04/15/94 0.0965 0.2699 14.21 16,099,813 49.583309
04/30/94 14.29 04/30/94 05/15/94 16,926,648
05/31/94 14.32 05/31/94 06/15/94 17,098,125
06/30/94 14.02 06/30/94 07/15/94 0.0937 14.32 17,069,415 13.006961
07/29/94 14.39 07/29/94 08/15/94 17,451,492
08/31/94 14.80 08/31/94 09/15/94 17,890,446
09/30/94 14.23 09/30/94 10/15/94 0.0861 14.33 17,519,760 12.030173
<S> <C> <C> <C>
09/29/90 1.067137 112.991449 1,241
10/31/90 112.991449 1,220
11/30/90 112.991449 1,273
12/31/90 1.258314 114.249763 1,288
01/31/91 114.249763 1,340
02/28/91 114.249763 1,402
03/28/91 0.976517 115.226281 1,401
04/30/91 115.226281 1,421
05/31/91 115.226281 1,505
06/28/91 0.833398 116.059678 1,454
07/31/91 116.059678 1,493
08/30/91 116.059678 1,523
09/30/91 0.938280 116.997959 1,524
10/31/91 116.997959 1,553
11/29/91 116.997959 1,514
12/31/91 3.103243 120.101202 1,663
01/31/92 120.101202 1,654
02/28/92 120.101202 1,684
03/31/92 2.156086 122.257288 1,659
04/30/92 122.257288 1,675
05/29/92 122.257288 1,679
06/30/92 0.765688 123.022976 1,660
07/31/92 123.022976 1,693
08/31/92 123.022976 1,661
09/30/92 0.965118 123.988094 1,696
10/31/92 123.988094 1,710
11/30/92 123.988094 1,753
12/31/92 4.281115 128.269209 1,782
01/31/93 128.269209 1,815
02/26/93 128.269209 1,845
03/31/93 0.849243 129.118452 1,866
04/30/93 129.118452 1,849
05/28/93 129.118452 1,861
06/30/93 0.818220 129.936672 1,893
07/30/93 129.936672 1,906
08/31/93 129.936672 1,957
09/30/93 1.038132 130.974804 1,971
10/31/93 130.974804 1,999
11/30/93 130.974804 1,970
12/31/93 4.350822 135.325626 2,031
01/31/94 135.325626 2,080
02/28/94 135.325626 2,042
03/31/94 3.489325 138.814951 1,975
04/30/94 138.814951 1,984
05/31/94 138.814951 1,988
06/30/94 0.908307 139.723258 1,959
07/29/94 139.723258 2,011
08/31/94 139.723258 2,068
09/30/94 0.839510 140.562768 2,000
</TABLE>
<PAGE>
NET CIF: TOTAL RETURN FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<CAPTION>
SHARES TO DAK (NAV +NOT REINVESTE GROSS VALUE
<S> <C> <C> <C> <C> <C> <C> <C> <C>
10/31/94 14.16 10/31/94 11/15/94 17,480,687
11/30/94 13.63 11/30/94 12/15/94 17,029,828
12/31/94 13.23 12/31/94 01/15/95 0.0963 0.5156 13.42 16,431,195 86.010357
01/31/95 13.36 01/31/95 02/15/95 17,373,376
02/28/95 13.92 02/28/95 03/15/95 17,921,746
03/31/95 14.13 03/31/95 04/15/95 0.0996 14.45 18,022,554 14.638400
04/30/95 14.54 04/30/95 05/15/95 18,022,554
05/31/95 15.10 05/31/95 06/15/95 19,522,639
06/30/95 15.46 06/30/95 07/15/95 0.1050 15.91 20,061,885 15.538417
07/31/95 15.96 07/31/95 08/15/95 n/a
08/31/95 16.07 08/31/95 09/15/95 20,702,746
09/30/95 16.38 09/30/95 10/15/95 0.0819 16.44 21,163,662 12.199952
10/31/95 16.17 10/31/95 11/15/95 20,916,516
11/30/95 16.67 11/30/95 12/15/95 21,656,073
12/31/95 15.96 12/31/95 12/31/95 0.0863 0.8560 15.96 20,955,648 141.065756
<CAPTION>
<S> <C> <C> <C>
10/31/94 140.562768 1,990
11/30/94 140.562768 1,916
12/31/94 6.409118 146.971885 1,944
01/31/95 146.971885 1,964
02/28/95 146.971885 2,046
03/31/95 1.013038 147.984923 2,091
04/30/95 147.984923 2,152
05/31/95 147.984923 2,235
06/30/95 0.976645 148.961568 2,303
07/31/95 148.961568 2,377
08/31/95 148.961568 2,394
09/30/95 0.742090 149.703657 2,452
10/31/95 149.703657 2,421
11/30/95 149.703657 2,496
12/31/95 8.838707 158.542364 2,530
</TABLE>
<PAGE>
GROSS CIF: TOTAL RETURN FUND
RATE OF RETURN
1 YEAR PREPARED ON: 12/31/95
................
PURCHASE DATE: 12/31/94
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 13.23
SHARES PURCHASED: 75.58578987
<TABLE>
<CAPTION>
DATE NAV EX-DATE PAYABLE DATE
<S> <C> <C> <C>
12/31/94 13.23 12/31/94 01/15/95
01/31/95 13.36 01/31/95 02/15/95
02/28/95 13.92 02/28/95 03/15/95
03/31/95 14.13 03/31/95 04/15/95
04/30/95 14.54 04/30/95 05/15/95
05/31/95 15.10 05/31/95 06/15/95
06/30/95 15.46 06/30/95 07/15/95
07/31/95 15.96 07/31/95 08/15/95
08/31/95 16.07 08/31/95 09/15/95
09/30/95 16.38 09/30/95 10/15/95
10/31/95 16.17 10/31/95 11/15/95
11/30/95 16.67 11/30/95 12/15/95
12/31/95 15.96 12/31/95 12/31/95
SHARES TO DATE X (NAV + NOT REINVESTED) GROSS VALUE
81.536341 15.96 1301.3200
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1301.3200 1,000.00 (301.3200)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(301.3200) 1,000.00 0.3013
ONE YEAR NET RATE OF RETURN: 30.13%
<CAPTION>
INCOME CAPITAL SHARES TOTALS
DATE DISTRIBUTION DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C> <C>
12/31/94 0.0963 0.5156 13.42 16,431,195 75.585790
01/31/95 17,373,376 75.585790
02/28/95 17,921,746 75.585790
03/31/95 0.0996 14.45 18,022,554 7.528345 0.520993 76.106783
04/30/95 18,022,554 76.106783
05/31/95 19,522,639 76.106783
06/30/95 0.1050 15.91 20,061,885 7.991212 0.502276 76.609059
07/31/95 n/a 76.609059
08/31/95 20,702,746 76.609059
09/30/95 0.0819 16.44 21,163,662 6.274282 0.381647 76.990706
10/31/95 20,916,516 76.990706
11/30/95 21,656,073 76.990706
12/31/95 0.0863 0.8560 15.96 20,955,648 72.548342 4.545635 81.536341
</TABLE>
<PAGE>
GROSS CIF: TOTAL RETURN FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
PURCHASE DATE: 12/31/90
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 11.27
SHARES PURCHASED: 88.73114463
<TABLE>
<CAPTION>
DATE NAV EX-DATE PAYABLE DATE
<S> <C> <C> <C>
12/31/90 11.27 12/31/90 01/15/91
01/31/91 11.73 01/31/91 02/15/91
02/28/91 12.27 02/28/91 03/15/91
03/28/91 12.16 03/28/91 04/15/91
04/30/91 12.33 04/30/91 05/15/91
05/31/91 13.06 05/31/91 06/14/91
06/28/91 12.53 06/28/91 07/15/91
07/31/91 12.86 07/31/91 08/15/91
08/30/91 13.12 08/30/91 09/14/91
09/30/91 13.03 09/30/91 10/15/91
10/31/91 13.27 10/31/91 11/15/91
11/29/91 12.94 11/29/91 12/13/91
12/31/91 13.85 12/31/91 01/15/92
01/31/92 13.77 01/31/92 02/14/92
02/28/92 14.02 02/28/92 03/15/92
03/31/92 13.57 03/31/92 04/15/92
04/30/92 13.70 04/30/92 05/15/92
05/29/92 13.73 05/29/92 06/16/92
06/30/92 13.49 06/30/92 07/15/92
07/31/92 13.76 07/31/92 08/14/92
08/31/92 13.50 08/31/92 09/15/92
09/30/92 13.68 09/30/92 10/15/92
10/31/92 13.79 10/31/92 11/13/92
11/30/92 14.14 11/30/92 12/15/92
12/31/92 13.89 12/31/92 12/31/92
01/31/93 14.15 01/29/93 02/12/93
02/26/93 14.38 02/26/93 03/15/93
03/31/93 14.45 03/31/93 04/15/93
04/30/93 14.32 04/30/93 05/14/93
05/28/93 14.41 05/28/93 06/15/93
06/30/93 14.57 06/30/93 07/15/93
07/30/93 14.67 07/30/93 08/16/93
08/31/93 15.06 08/31/93 09/15/93
09/30/93 15.05 09/30/93 10/15/93
SHARES TO DATE X (NAV + NOT REINVESTED)GROSS VALUE
123.130631 15.96 1965.1649
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1965.1649 1,000.00 (965.1649)
NET VALUE / INITIAL INVESTMENT GROSS RATE OF RETURN
(965.1649) 1,000.00 0.9652
GROSS 5 YEAR RETURN: 96.52%
ANNUALIZED GROSS 5 YEAR RETURN: 14.47%
<CAPTION>
INCOME CAPITAL
DATE DISTRIBUTION DISTRIBUTIONS REINVEST NAV NET ASSETS
<S> <C> <C> <C> <C>
12/31/90 0.1215 0.0010 11.00 1,954,642
01/31/91 2,085,046
02/28/91 2,303,512
03/28/91 0.1009 0.0050 12.39 2,436,913
04/30/91 2,749,392
05/31/91 3,080,960
06/28/91 0.0920 12.72 3,191,376
07/31/91 3,727,661
08/30/91 4,145,573
09/30/91 0.1072 13.26 4,359,700
10/31/91 4,550,728
11/29/91 4,779,963
12/31/91 0.0865 0.2851 14.01 5,225,792
01/31/92 5,403,579
02/28/92 6,140,736
03/31/92 0.0842 0.1639 13.82 6,531,831
04/30/92 7,414,267
05/29/92 8,386,706
06/30/92 0.0848 13.54 8,227,266
07/31/92
08/31/92 8,819,903
09/30/92 0.1063 13.55 8,971,058
10/31/92 9,153,486
11/30/92 9,184,242
12/31/92 0.1063 0.3733 13.89 9,250,893
01/31/93 9,645,668
02/26/93 10,594,367
03/31/93 0.0952 0.0010 14.53 10,194,748
04/30/93 10,582,193
05/28/93 11,342,446
06/30/93 0.0929 14.66 11,547,410
07/30/93 12,183,663
08/31/93 12,948,117
09/30/93 0.1220 $15.27 13,226,508
SHARES TO DATE X (NAV + NOT REINVESTED)GROSS VALUE
123.130631 15.96 1965.1649
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1965.1649 1,000.00 (965.1649)
NET VALUE / INITIAL INVESTMENT GROSS RATE OF RETURN
(965.1649) 1,000.00 0.9652
GROSS 5 YEAR RETURN: 96.52%
ANNUALIZED GROSS 5 YEAR RETURN: 14.47%
<CAPTION>
SHARES TOTALS
DATE $ TO DIST. REINV. SHARES
<S> <C> <C> <C>
12/31/90 88.731145
01/31/91 88.731145
02/28/91 88.731145
03/28/91 9.396628 0.758404 89.489549
04/30/91 89.489549
05/31/91 89.489549
06/28/91 8.233038 0.647251 90.136800
07/31/91 90.136800
08/30/91 90.136800
09/30/91 9.662665 0.728708 90.865508
10/31/91 90.865508
11/29/91 90.865508
12/31/91 33.765623 2.410109 93.275617
01/31/92 93.275617
02/28/92 93.275617
03/31/92 23.141681 1.674507 94.950123
04/30/92 94.950123
05/29/92 94.950123
06/30/92 8.051770 0.594665 95.544789
07/31/92 95.544789
08/31/92 95.544789
09/30/92 10.156411 0.749551 96.294339
10/31/92 96.294339
11/30/92 96.294339
12/31/92 46.182765 3.324893 99.619233
01/31/93 99.619233
02/26/93 99.619233
03/31/93 9.583370 0.659557 100.278790
04/30/93 100.278790
05/28/93 100.278790
06/30/93 9.315900 0.635464 100.914254
07/30/93 100.914254
08/31/93 100.914254
09/30/93 12.311539 0.806257 101.720510
</TABLE>
<PAGE>
GROSS CIF: TOTAL RETURN FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
<TABLE>
<S> <C> <C> <C>
10/31/93 15.26 10/31/93 11/15/93
11/30/93 15.04 11/30/93 12/15/93
12/31/93 15.01 12/31/93 01/14/94
01/31/94 15.37 01/31/94 02/15/94
02/28/94 15.09 02/28/94 03/15/94
03/31/94 14.23 03/31/94 04/15/94
04/30/94 14.29 04/30/94 05/15/94
05/31/94 14.32 05/31/94 06/15/94
06/30/94 14.02 06/30/94 07/15/94
07/29/94 14.39 07/29/94 08/15/94
08/31/94 14.80 08/31/94 09/15/94
09/30/94 14.23 09/30/94 10/15/94
10/31/94 14.16 10/31/94 11/15/94
11/30/94 13.63 11/30/94 12/15/94
12/31/94 13.23 12/31/94 01/15/95
01/31/95 13.36 01/31/95 02/15/95
02/28/95 13.92 02/28/95 03/15/95
03/31/95 14.13 03/31/95 04/15/95
04/30/95 14.54 04/30/95 05/15/95
05/31/95 15.10 05/31/95 06/15/95
06/30/95 15.46 06/30/95 07/15/95
07/31/95 15.96 07/31/95 08/15/95
08/31/95 16.07 08/31/95 09/15/95
09/30/95 16.38 09/30/95 10/15/95
10/31/95 16.17 10/31/95 11/15/95
11/30/95 16.67 11/30/95 12/15/95
12/31/95 15.96 12/31/95 12/31/95
<S> <C> <C> <C> <C> <C> <C> <C>
13,842,316 101.720510
10/31/93 14,134,348 101.720510
11/30/93 0.0950 0.4076 15.13 14,360,086 51.124729 3.379030 105.099541
12/31/93 15,977,490 105.099541
01/31/94 15,962,814 105.099541
02/28/94 0.0965 0.2699 14.21 16,099,813 38.508472 2.709956 107.809497
03/31/94 16,926,648 107.809497
04/30/94 17,098,125 107.809497
05/31/94 0.0937 14.32 17,069,415 10.101750 0.705429 108.514926
06/30/94 17,451,492 108.514926
07/29/94 17,890,446 108.514926
08/31/94 0.0861 14.33 17,519,760 9.343135 0.651998 109.166924
09/30/94 17,480,687 109.166924
10/31/94 17,029,828 109.166924
11/30/94 0.0963 0.5156 13.42 16,431,195 66.799241 4.977589 114.144513
12/31/94 17,373,376 114.144513
01/31/95 17,921,746 114.144513
02/28/95 0.0996 14.45 18,022,554 11.368793 0.786768 114.931281
03/31/95 18,022,554 114.931281
04/30/95 19,522,639 114.931281
05/31/95 0.1050 15.91 20,061,885 12.067784 0.758503 115.689784
06/30/95 n/a 115.689784
07/31/95 20,702,746 115.689784
08/31/95 0.0819 16.44 21,163,662 9.474993 0.576338 116.266122
09/30/95 20,916,516 116.266122
10/31/95 21,656,073 116.266122
11/30/95 0.0863 0.8560 15.96 20,955,648 109.557566 6.864509 123.130631
12/31/95
</TABLE>
<PAGE>
GROSS CIF: TOTAL RETURN FUND
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 12/18/87
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 10.24
SHARES PURCHASED: 97.656
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/87 10.21 12/31/87 01/14/88 0.0396
01/29/88 10.51 01/29/88 02/12/88 0.0000
02/29/88 10.76 02/29/88 03/15/88 0.0000
03/31/88 10.34 03/31/88 04/15/88 0.1392
04/29/88 10.50 04/29/88 05/15/88 0.0000
05/31/88 10.52 05/31/88 06/15/88 0.0000
06/30/88 10.92 06/30/88 07/15/88 0.0600
07/29/88 10.68 07/29/88 08/15/88 0.0000
08/31/88 10.43 08/31/88 09/15/88 0.0000
09/30/88 10.49 09/30/88 10/14/88 0.1672
10/31/88 10.64 10/31/88 11/15/88 0.0000
11/30/88 10.56 11/30/88 12/15/88 0.0000
12/30/88 10.51 12/30/88 01/13/88 0.1564
01/31/89 10.99 01/31/89 02/15/89 0.0000
02/28/89 10.75 02/28/89 03/15/89 0.0000
03/31/89 10.69 03/31/89 04/14/89 0.1819
04/28/89 11.08 04/28/89 05/15/89 0.0000
05/31/89 11.51 05/31/89 06/15/89 0.0000
06/30/89 11.32 06/30/89 07/14/89 0.1437
07/31/89 12.05 07/31/89 08/15/89 0.0000
08/31/89 12.39 08/31/89 09/15/89 0.0000
09/29/89 12.20 09/29/89 10/13/89 0.1451
10/31/89 11.96 10/31/89 11/15/89 0.0000
11/30/89 12.35 11/30/89 12/15/89 0.0000
12/29/89 12.09 12/29/89 01/15/90 0.1366
01/31/90 11.51 01/31/90 02/15/90 0.0000
02/28/90 11.99 02/28/90 03/15/90 0.0000
03/30/90 11.65 03/30/90 04/12/90 0.1067
04/30/90 11.40 04/30/90 05/15/90 0.0000
05/31/90 12.19 05/31/90 06/15/90 0.0000
06/29/90 12.10 06/29/90 07/13/90 0.1060
07/31/90 12.33 07/31/90 08/15/90 0.0000
08/31/90 11.47 08/31/90 09/14/90 0.0000
SHARES TO DATE X (NAV + NOT REINVESTED)= GROSS VALUE
SHARES TO DATE X (NAV + NOT REINVESTED)= GROSS VALUE
166.902996 15.96 0 2663.7718
GROSS VALUE - INITIAL INVESTMENT =NET VALUE
2663.7718 1,000.00 (1663.7718)
NET VALUE / INITIAL INVESTMENT =GROSS RATE OF RETURN
(1663.7718) 1,000.00 1.6638
GROSS RATE OF RETURN SINCE INCEPTION: 166.38%
ANNUALIZED GROSS RATE OF RETURN SINCE INCEPTION: 12.96%
<CAPTION>
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/87 10.34 103,470 3.867188 0.374003 98.030253
01/29/88 0.00 108,560 0.000000 0.000000 98.030253
02/29/88 0.00 112,138 0.000000 0.000000 98.030253
03/31/88 10.45 130,445 13.648752 1.306101 99.336353
04/29/88 0.00 221,004 0.000000 0.000000 99.336353
05/31/88 0.00 489,193 0.000000 0.000000 99.336353
06/30/88 10.72 774,433 5.960181 0.555987 99.892340
07/29/88 0.00 769,223 0.000000 0.000000 99.892340
08/31/88 0.00 761,510 0.000000 0.000000 99.892340
09/30/88 10.52 767,118 16.701999 1.587643 101.479983
10/31/88 0.00 795,701 0.000000 0.000000 101.479983
11/30/88 0.00 793,250 0.000000 0.000000 101.479983
12/30/88 0.0200 10.73 797,889 17.907868 1.668953 103.148936
01/31/89 0.0000 0.00 896,603 0.000000 0.000000 103.148936
02/28/89 0.00 879,341 0.000000 0.000000 103.148936
03/31/89 0.0442 10.85 885,033 23.328163 2.150061 105.298997
04/28/89 0.00 975,301 0.000000 0.000000 105.298997
05/31/89 0.00 1,016,910 0.000000 0.000000 105.298997
06/30/89 11.66 1,083,180 15.126201 1.297273 106.596270
07/31/89 0.00 1,179,952 0.000000 0.000000 106.596270
08/31/89 0.00 1,219,238 0.000000 0.000000 106.596270
09/29/89 11.91 1,240,218 15.462855 1.298309 107.894579
10/31/89 0.00 1,207,108 0.000000 0.000000 107.894579
11/30/89 0.00 1,266,394 0.000000 0.000000 107.894579
12/29/89 0.3807 11.72 1,237,868 55.821958 4.762966 112.657544
01/31/90 0.00 1,219,809 0.000000 0.000000 112.657544
02/28/90 0.00 1,327,410 0.000000 0.000000 112.657544
03/30/90 0.3262 11.67 1,385,635 48.769451 4.179045 116.836589
04/30/90 0.00 1,435,375 0.000000 0.000000 116.836589
05/31/90 0.00 0 0.000000 0.000000 116.836589
06/29/90 12.51 1,617,895 12.384678 0.989982 117.826571
07/31/90 0.00 0 0.000000 0.000000 117.826571
08/31/90 0.00 0 0.000000 0.000000 117.826571
</TABLE>
<PAGE>
GROSS CIF: TOTAL RETURN FUND
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
SHARES TO DATE X (NAV + NOT REINVESTED)=GROSS VALUE
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
09/29/90 10.98 09/29/90 10/15/90 0.1024 10.74 1,679,538
10/31/90 10.80 10/31/90 11/15/90 0.0000 0.00 0
11/30/90 11.27 11/30/90 12/14/90 0.0000 0.00 0
12/31/90 11.27 12/31/90 01/15/91 0.1215 0.0010 11.00 1,954,642
01/31/91 11.73 01/31/91 02/15/91 0.0000 0.00 2,085,046
02/28/91 12.27 02/28/91 03/15/91 0.0000 0.00 2,303,512
03/28/91 12.16 03/28/91 04/15/91 0.1009 0.0050 12.39 2,436,913
04/30/91 12.33 04/30/91 05/15/91 0.0000 0.00 2,749,392
05/31/91 13.06 05/31/91 06/14/91 0.0000 0.00 3,080,960
06/28/91 12.53 06/28/91 07/15/91 0.0920 12.72 3,191,376
07/31/91 12.86 07/31/91 08/15/91 0 0 3,727,661
08/30/91 13.12 08/30/91 09/14/91 0.0000 0.00 4,145,573
09/30/91 13.03 09/30/91 10/15/91 0.1072 13.26 4,359,700
10/31/91 13.27 10/31/91 11/15/91 0.0000 0.00 4,550,728
11/29/91 12.94 11/29/91 12/13/91 0.0000 0.00 4,779,963
12/31/91 13.85 12/31/91 01/15/92 0.0865 0.2851 14.01 5,225,792
01/31/92 13.77 01/31/92 02/14/92 0.0000 0.00 5,403,579
02/28/92 14.02 02/28/92 03/15/92 0.0000 0.00 6,140,736
03/31/92 13.57 03/31/92 04/15/92 0.0842 0.1639 13.82 6,531,831
04/30/92 13.70 04/30/92 05/15/92 0.0000 0.00 7,414,267
05/29/92 13.73 05/29/92 06/16/92 0.0000 0.00 8,386,706
06/30/92 13.49 06/30/92 07/15/92 0.0848 13.54 8,227,266
07/31/92 13.76 07/31/92 08/14/92 0.0000 0.00 0
08/31/92 13.50 08/31/92 09/15/92 0.0000 0.00 8,819,903
09/30/92 13.68 09/30/92 10/15/92 0.1063 13.55 8,971,058
10/31/92 13.79 10/31/92 11/13/92 0.0000 0.00 9,153,486
11/30/92 14.14 11/30/92 12/15/92 9,184,242
12/31/92 13.89 12/31/92 12/31/92 0.1063 0.3733 13.89 9,250,893
01/31/93 14.15 01/29/93 02/12/93 9,645,668
02/26/93 14.38 02/26/93 03/15/93 10,594,367
03/31/93 14.45 03/31/93 04/15/93 0.0952 0.0010 14.53 10,194,748
04/30/93 14.32 04/30/93 05/14/93 10,582,193
05/28/93 14.41 05/28/93 06/15/93 11,342,446
06/30/93 14.57 06/30/93 07/15/93 0.0929 14.66 11,547,410
07/30/93 14.67 07/30/93 08/16/93 12,183,663
08/31/93 15.06 08/31/93 09/15/93 0.00 12,948,117
09/30/93 15.05 09/30/93 10/15/93 0.1220 0.0000 $15.27 13,226,508
10/31/93 15.26 10/31/93 11/15/93 0.0000 0.0000 13,842,316
11/30/93 15.04 11/30/93 12/15/93 0.0000 0.0000 14,134,348
12/31/93 15.01 12/31/93 01/14/94 0.0950 0.4076 15.13 14,360,086
01/31/94 15.37 01/31/94 02/15/94 0.0000 0.0000 15,977,490
02/28/94 15.09 02/28/94 03/15/94 0.0000 0.0000 15,962,814
03/31/94 14.23 03/31/94 04/15/94 0.0965 0.2699 14.21 16,099,813
04/30/94 14.29 04/30/94 05/15/94 0.0000 0.0000 16,926,648
05/31/94 14.32 05/31/94 06/15/94 0.0000 0.0000 17,098,125
06/30/94 14.02 06/30/94 07/15/94 0.0937 0.0000 14.32 17,069,415
07/29/94 14.39 07/29/94 08/15/94 0.0000 0.0000 17,451,492
08/31/94 14.80 08/31/94 09/15/94 0.0000 0.0000 17,890,446
09/30/94 14.23 09/30/94 10/15/94 0.0861 0.0000 14.33 17,519,760
<S> <C> <C> <C>
09/29/90 12.065441 1.123412 118.949983
10/31/90 0.000000 0.000000 118.949983
11/30/90 0.000000 0.000000 118.949983
12/31/90 14.571373 1.324670 120.274653
01/31/91 0.000000 0.000000 120.274653
02/28/91 0.000000 0.000000 120.274653
03/28/91 12.737086 1.028013 121.302667
04/30/91 0.000000 0.000000 121.302667
05/31/91 0.000000 0.000000 121.302667
06/28/91 11.159845 0.877346 122.180013
07/31/91 0.000000 0.000000 122.180013
08/30/91 0.000000 0.000000 122.180013
09/30/91 13.097697 0.987760 123.167773
10/31/91 0.000000 0.000000 123.167773
11/29/91 0.000000 0.000000 123.167773
12/31/91 45.769144 3.266891 126.434664
01/31/92 0.000000 0.000000 126.434664
02/28/92 0.000000 0.000000 126.434664
03/31/92 31.368440 2.269786 128.704450
04/30/92 0.000000 0.000000 128.704450
05/29/92 0.000000 0.000000 128.704450
06/30/92 10.914137 0.806066 129.510516
07/31/92 0.000000 0.000000 129.510516
08/31/92 0.000000 0.000000 129.510516
09/30/92 13.766968 1.016012 130.526528
10/31/92 0.000000 0.000000 130.526528
11/30/92 0.000000 0.000000 130.526528
12/31/92 62.600523 4.506877 135.033406
01/31/93 0.000000 0.000000 135.033406
02/26/93 0.000000 0.000000 135.033406
03/31/93 12.990214 0.894027 135.927433
04/30/93 0.000000 0.000000 135.927433
05/28/93 0.000000 0.000000 135.927433
06/30/93 12.627658 0.861368 136.788801
07/30/93 0.000000 0.000000 136.788801
08/31/93 0.000000 0.000000 136.788801
09/30/93 16.688234 1.092877 137.881678
10/31/93 0.000000 0.000000 137.881678
11/30/93 0.000000 0.000000 137.881678
12/31/93 69.299331 4.580260 142.461938
01/31/94 0.000000 0.000000 142.461938
02/28/94 0.000000 0.000000 142.461938
03/31/94 52.198054 3.673332 146.135270
04/30/94 0.000000 0.000000 146.135270
05/31/94 0.000000 0.000000 146.135270
06/30/94 13.692875 0.956206 147.091477
07/29/94 0.000000 0.000000 147.091477
08/31/94 0.000000 0.000000 147.091477
09/30/94 12.664576 0.883781 147.975257
</TABLE>
<PAGE>
GROSS CIF: TOTAL RETURN FUND
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
SHARES TO DATE X (NAV + NOT REINVESTED)=GROSS VALUE
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
10/31/94 14.16 10/31/94 11/15/94 0.0000 0.0000 17,480,687
11/30/94 13.63 11/30/94 12/15/94 0.0000 0.0000 17,029,828
12/31/94 13.23 12/31/94 01/15/95 0.0963 0.5156 13.42 16,431,195
01/31/95 13.36 01/31/95 02/15/95 0.0000 0.0000 17,373,376
02/28/95 13.92 02/28/95 03/15/95 0.0000 0.0000 0.00 17,921,746
03/31/95 14.13 03/31/95 04/15/95 0.0996 0.0000 14.45 18,022,554
04/30/95 14.54 04/30/95 05/15/95 0.0000 0.0000 18,022,554
05/31/95 15.10 05/31/95 06/15/95 0.0000 0.0000 0.00 19,522,639
06/30/95 15.46 06/30/95 07/15/95 0.1050 0.0000 15.91 20,061,885
07/31/95 15.96 07/31/95 08/15/95 0.0000 0.0000 0.00 n/a
08/31/95 16.07 08/31/95 09/15/95 0.0000 0.0000 0.00 20,702,746
09/30/95 16.38 09/30/95 10/15/95 0.0819 0.0000 16.44 21,163,662
10/31/95 16.17 10/31/95 11/15/95 0.0000 0.0000 0.00 20,916,516
11/30/95 16.67 11/30/95 12/15/95 0.0000 0.0000 0.00 21,656,073
12/31/95 15.96 12/31/95 12/31/95 0.0863 0.8560 15.96 20,955,648
<S> <C> <C> <C>
10/31/94 0.000000 0.000000 147.975257
11/30/94 0.000000 0.000000 147.975257
12/31/94 90.546060 6.747098 154.722356
01/31/95 0.000000 0.000000 154.722356
02/28/95 0.000000 0.000000 154.722356
03/31/95 15.410347 1.066460 155.788816
04/30/95 0.000000 0.000000 155.788816
05/31/95 0.000000 0.000000 155.788816
06/30/95 16.357826 1.028147 156.816963
07/31/95 0.000000 0.000000 156.816963
08/31/95 0.000000 0.000000 156.816963
09/30/95 12.843309 0.781223 157.598186
10/31/95 0.000000 0.000000 157.598186
11/30/95 0.000000 0.000000 157.598186
12/31/95 148.504771 9.304810 166.902996
</TABLE>
<PAGE>
NET CIF: TAX-EXEMPT FUND
RATE OF RETURN
1 YEAR PREPARED ON: 12/31/95
................
PURCHASE DATE: 12/31/94
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 11.57 (3% SALES LOAD)
SHARES PURCHASED: 86.43042351
<TABLE>
<CAPTION>
DATE NAV EX-DATE PAYABLE DATE
<S> <C> <C> <C>
12/31/94 11.22 12/31/94 01/15/95
01/31/95 11.39 01/31/95 02/15/95
02/28/95 11.71 02/28/95 03/15/95
03/31/95 11.81 03/31/95 04/15/95
04/30/95 11.80 04/30/95 05/15/95
05/31/95 12.05 05/31/95 06/15/95
06/30/95 11.92 06/30/95 07/15/95
07/31/95 11.94 07/31/95 08/15/95
08/31/95 11.97 08/31/95 09/15/95
09/30/95 11.98 09/30/95 10/15/95
10/31/95 12.11 10/31/95 11/15/95
11/30/95 12.27 11/30/95 12/15/95
12/31/95 12.33 12/31/95 12/31/95
SHARES TO DATE X (NAV + NOT REINVESTED)GROSS VALUE
91.141244 12.33 1123.7715
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1123.7715 1,000.00 (123.7715)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(123.7715) 1,000.00 0.1238
ONE YEAR NET RATE OF RETURN: 12.38%
<CAPTION>
INCOME CAPITAL SHARES TOTALS
DATE DISTRIBUTION DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C> <C>
12/31/94 0.0567 11.33 13,973,940 86.430424
01/31/95 0.0525 0.0011 11.62 14,027,640 4.632671 0.398681 86.829104
02/28/95 0.0530 11.79 14,390,550 4.601943 0.390326 87.219430
03/31/95 0.0511 11.89 14,760,906 4.456913 0.374845 87.594276
04/30/95 0.0486 11.96 4.257082 0.355943 87.950219
05/31/95 0.0548 12.05 15,118,186 4.815890 0.399659 88.349878
06/30/95 0.0518 12.06 15,101,454 4.576524 0.379480 88.729357
07/31/95 0.0519 12.21 n/a 4.605054 0.377154 89.106512
08/31/95 0.0523 12.45 14,678,329 4.660271 0.374319 89.480831
09/30/95 0.0508 12.16 14,692,304 4.545626 0.373818 89.854649
10/31/95 0.0530 12.18 15,083,403 4.762296 0.390993 90.245642
11/30/95 0.0517 12.29 15,146,074 4.665700 0.379634 90.625276
12/31/95 0.0498 0.0204 12.33 15,181,292 6.361894 0.515969 91.141244
</TABLE>
<PAGE>
NET CIF: TAX-EXEMPT FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
PURCHASE DATE: 12/31/90
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 11.22 (3% SALES LOAD)
SHARES PURCHASED: 89.12655971
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/90 10.88 12/31/90 01/15/91 0.0547
01/31/91 10.95 01/31/91 02/15/91 0.0550
02/28/91 10.96 02/28/91 03/15/91 0.0540
03/28/91 10.94 03/28/91 04/15/91 0.0501
04/30/91 11.04 04/30/91 05/15/91 0.0572
05/31/91 11.05 05/31/91 06/14/91 0.0504
06/28/91 10.95 06/28/91 07/15/91 0.0496
07/31/91 11.07 07/31/91 08/15/91 0.0561
08/30/91 11.13 08/30/91 09/14/91 0.0542
09/30/91 11.21 09/30/91 10/15/91 0.0523
10/31/91 11.24 10/31/91 11/15/91 0.0526
11/29/91 11.22 11/29/91 12/13/91 0.0485
12/31/91 11.38 12/31/91 01/15/92 0.0542
01/31/92 11.37 01/31/92 02/14/92 0.0518
02/28/92 11.30 02/28/92 03/15/92 0.0487
03/31/92 11.29 03/31/92 04/15/92 0.0601
04/30/92 11.35 04/30/92 05/15/92 0.0499
05/29/92 11.44 05/29/92 06/16/92 0.0499
06/30/92 11.58 06/30/92 07/15/92 0.0527
07/31/92 12.00 07/31/92 08/14/92 0.0502
08/31/92 11.74 08/31/92 09/15/92 0.0516
09/30/92 11.72 09/30/92 10/15/92 0.0524
10/31/92 11.47 10/31/92 11/13/92 0.0518
11/30/92 11.7 11/30/92 12/15/92 0.0496
12/31/92 11.74 12/31/92 12/31/92 0.0505
01/29/93 11.8 01/29/93 02/12/93 0.0482
02/26/93 12.13 02/26/93 03/15/93 0.0449
03/31/93 12.09 03/31/93 04/15/93 0.0565
04/30/93 12.14 04/30/93 05/14/93 0.0497
05/28/93 12.17 05/28/93 06/15/93 0.0449
06/30/93 12.3 06/30/93 07/15/93 0.0499
07/30/93 12.25 07/30/93 08/16/93 0.0461
08/31/93 12.43 08/31/93 09/15/93 0.0483
09/30/93 12.59 09/30/93 10/15/93 0.0492
SHARES TO DATE X (NAV + NOT REINVESTED) GROSS VALUE
116.451843 12.33 1435.8512
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1435.8512 1,000.00 (435.8512)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(435.8512) 1,000.00 0.4359
NET 5 YEAR RETURN: 43.59%
ANNUALIZED NET 5 YEAR RETURN: 7.50%
<CAPTION>
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/90 0.0147 10.87 4,311,013 89.126560
01/31/91 11.12 4,665,829 4.901961 0.440824 89.567384
02/28/91 10.99 4,655,184 4.836639 0.440095 90.007478
03/28/91 11.04 4,747,680 4.509375 0.408458 90.415936
04/30/91 11.04 4,869,752 5.171792 0.468459 90.884395
05/31/91 10.90 5,318,177 4.580574 0.420236 91.304631
06/28/91 11.03 5,370,829 4.528710 0.410581 91.715212
07/31/91 11.15 5,625,261 5.145223 0.461455 92.176668
08/30/91 11.18 5,689,530 4.995975 0.446867 92.623535
09/30/91 11.26 3,832,831 4.844211 0.430214 93.053749
10/31/91 11.26 6,112,031 4.894627 0.434692 93.488440
11/29/91 11.28 6,508,228 4.534189 0.401967 93.890408
12/31/91 11.46 6,724,553 5.088860 0.444054 94.334462
01/31/92 11.30 6,979,104 4.886525 0.432436 94.766897
02/28/92 11.26 7,053,641 4.615148 0.409871 95.176769
03/31/92 11.42 7,118,759 5.720124 0.500886 95.677655
04/30/92 11.46 7,330,710 4.774315 0.416607 96.094262
05/29/92 11.50 7,621,702 4.795104 0.416966 96.511227
06/30/92 11.78 8,084,715 5.086142 0.431761 96.942988
07/31/92 11.94 8,608,385 4.866538 0.407583 97.350571
08/31/92 11.79 8,529,170 5.023289 0.426064 97.776635
09/30/92 11.67 8,637,959 5.123496 0.439031 98.215666
10/31/92 11.64 8,534,470 5.087571 0.437077 98.652742
11/30/92 11.77 9,184,242 4.893176 0.415733 99.068475
12/31/92 0.0413 11.74 9,250,893 9.094486 0.774658 99.843133
01/29/93 0.0074 11.92 9,645,668 5.551278 0.465711 100.308845
02/26/93 12.09 10,246,855 4.503867 0.372528 100.681373
03/31/93 12.19 10,859,516 5.688498 0.466653 101.148026
04/30/93 12.19 11,297,394 5.027057 0.412392 101.560418
05/28/93 12.21 12,303,691 4.560063 0.373470 101.933887
06/30/93 12.35 13,370,158 5.086501 0.411862 102.345750
07/30/93 12.38 14,328,028 4.718139 0.381110 102.726859
08/31/93 12.56 14,328,028 4.961707 0.395040 103.121900
09/30/93 12.71 15,130,849 5.073597 0.399182 103.521081
</TABLE>
<PAGE>
NET CIF: TAX-EXEMPT FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
<TABLE>
<S> <C> <C> <C> <C>
10/31/93 12.57 10/31/93 11/15/93 0.0469
11/30/93 12.41 11/30/93 12/15/93 0.0498
12/31/93 12.58 12/31/93 01/14/94 0.0490
01/31/94 12.66 01/31/94 02/15/94 0.0493
02/28/94 12.31 02/28/94 03/15/94 0.0502
03/31/94 11.82 03/31/94 04/15/94 0.0483
04/30/94 11.73 04/30/94 05/15/94 0.0474
05/31/94 11.77 05/31/94 06/15/94 0.0528
06/30/94 11.70 06/30/94 07/15/94 0.0513
07/29/94 11.82 07/29/94 08/15/94 0.0501
08/31/94 11.82 08/31/94 09/15/94 0.0541
09/30/94 11.57 09/30/94 10/15/94 0.0525
10/31/94 11.33 10/31/94 11/15/94 0.0523
11/30/94 11.01 11/30/94 12/15/94 0.0533
12/31/94 11.22 12/31/94 01/15/95 0.0567
01/31/95 11.39 01/31/95 02/15/95 0.0525
02/28/95 11.71 02/28/95 03/15/95 0.0530
03/31/95 11.81 03/31/95 04/15/95 0.0511
04/30/95 11.80 04/30/95 05/15/95 0.0486
05/31/95 12.05 05/31/95 06/15/95 0.0548
06/30/95 11.92 06/30/95 07/15/95 0.0518
07/31/95 11.94 07/31/95 08/15/95 0.0519
08/31/95 11.97 08/31/95 09/15/95 0.0523
09/30/95 11.98 09/30/95 10/15/95 0.0508
10/31/95 12.11 10/31/95 11/15/95 0.0530
11/30/95 12.27 11/30/95 12/15/95 0.0517
12/31/95 12.33 12/31/95 12/31/95 0.0498
<S> <C> <C> <C> <C> <C> <C>
10/31/93 12.46 15,599,581 4.855139 0.389658 103.910739
11/30/93 12.57 15,907,412 5.174755 0.411675 104.322414
12/31/93 0.0028 12.61 16,406,372 5.403901 0.428541 104.750955
01/31/94 12.55 16,755,110 5.164222 0.411492 105.162447
02/28/94 12.06 16,599,778 5.279155 0.437741 105.600188
03/31/94 11.74 16,375,493 5.100489 0.434454 106.034642
04/30/94 11.69 16,016,440 5.026042 0.429944 106.464586
05/31/94 11.97 15,890,838 5.621330 0.469618 106.934204
06/30/94 11.75 15,741,588 5.485725 0.466870 107.401074
07/29/94 11.74 15,805,744 5.380794 0.458330 107.859404
08/31/94 11.75 15,476,818 5.835194 0.496612 108.356016
09/30/94 11.58 15,144,983 5.688691 0.491251 108.847268
10/31/94 11.05 14,601,995 5.692712 0.515178 109.362445
11/30/94 11.20 13,862,752 5.829018 0.520448 109.882893
12/31/94 11.33 13,973,940 6.230360 0.549899 110.432793
01/31/95 0.0011 11.62 14,027,640 5.919198 0.509397 110.942190
02/28/95 11.79 14,390,550 5.879936 0.498722 111.440912
03/31/95 11.89 14,760,906 5.694631 0.478943 111.919855
04/30/95 11.96 5.439305 0.454791 112.374646
05/31/95 12.05 15,118,186 6.153299 0.510647 112.885294
06/30/95 12.06 15,101,454 5.847458 0.484864 113.370158
07/31/95 12.21 n/a 5.883911 0.481893 113.852050
08/31/95 12.45 14,678,329 5.954462 0.478270 114.330320
09/30/95 12.16 14,692,304 5.807980 0.477630 114.807950
10/31/95 12.18 15,083,403 6.084821 0.499575 115.307525
11/30/95 12.29 15,146,074 5.961399 0.485061 115.792586
12/31/95 0.0204 12.33 15,181,292 8.128640 0.659257 116.451843
</TABLE>
<PAGE>
NET CIF: TAX-EXEMPT FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 12/10/87
INITIAL INVESTME $1,000.00
INITIAL VALUE: 10.31 (3% SALES LOAD)
SHARES PURCHASED 96.993
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/87 10.11 12/31/87 01/14/88 0.0369
01/29/88 10.51 01/29/88 02/12/88 0.0500
02/29/88 10.57 02/29/88 03/15/88 0.0800
03/31/88 10.18 03/31/88 04/15/88 0.0688
04/29/88 10.14 04/29/88 05/15/88 0.0640
05/31/88 10.08 05/31/88 06/15/88 0.0700
06/30/88 10.32 06/30/88 07/15/88 0.0600
07/29/88 10.27 07/29/88 08/15/88 0.0684
08/31/88 10.29 08/31/88 09/15/88 0.0682
09/30/88 10.51 09/30/88 10/14/88 0.0685
10/31/88 10.74 10/31/88 11/15/88 0.0638
11/30/88 10.52 11/30/88 12/15/88 0.0668
12/30/88 10.68 12/30/88 01/13/88 0.0635
01/31/89 10.60 01/31/89 02/15/89 0.0591
02/28/89 10.57 02/28/89 03/15/89 0.0575
03/31/89 10.48 03/31/89 04/14/89 0.0690
04/28/89 10.81 04/28/89 05/15/89 0.0616
05/31/89 11.00 05/31/89 06/15/89 0.0724
06/30/89 11.15 06/30/89 07/14/89 0.0623
07/31/89 11.16 07/31/89 08/15/89 0.0681
08/31/89 10.93 08/31/89 09/15/89 0.0670
09/29/89 10.82 09/29/89 10/13/89 0.0613
10/31/89 10.92 10/31/89 11/15/89 0.0678
11/30/89 11.07 11/30/89 12/15/89 0.0634
12/29/89 11.01 12/29/89 01/15/90 0.0631
01/31/90 10.74 01/31/90 02/15/90 0.0532
02/28/90 10.76 02/28/90 03/15/90 0.0539
03/30/90 10.70 03/30/90 04/12/90 0.0535
04/30/90 10.51 04/30/90 05/15/90 0.0549
05/31/90 10.75 05/31/90 06/15/90 0.0572
06/29/90 10.83 06/29/90 07/13/90 0.0495
07/31/90 10.95 07/31/90 08/15/90 0.0567
08/31/90 10.58 08/31/90 09/14/90 0.0583
09/29/90 10.53 09/29/90 10/15/90 0.0496
SHARES TO DAX (NAV +NOT REINVESTE GROSS VALUE
157.930722 12.33 1947.2858
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1947.2858 1,000.00 (947.2858)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(947.2858) 1,000.00 0.9473
NET RATE OF RETURN SINCE INCEPTION: 94.73%
ANNUALIZED NET RATE OF RETURN SINCE INCE 8.62%
<CAPTION>
CAPITAL SHARES TOTALS ACCOUNT
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES VALUE
<S> <C> <C> <C> <C> <C> <C> <C>
12/31/87 10.20 1,116,723 3.579049 0.350887 97.344098 984
01/29/88 10.62 1,168,306 4.867205 0.458306 97.802403 1,028
02/29/88 10.42 1,174,346 7.824192 0.750882 98.553285 1,042
03/31/88 10.18 1,139,983 6.780466 0.666058 99.219343 1,010
04/29/88 10.15 1,150,259 6.350038 0.625620 99.844962 1,012
05/31/88 10.37 1,143,877 6.989147 0.673978 100.518940 1,013
06/30/88 10.28 1,212,755 6.031136 0.586686 101.105626 1,043
07/29/88 10.25 1,212,755 6.915625 0.674695 101.780322 1,045
08/31/88 10.52 1,174,677 6.941418 0.659831 102.440152 1,054
09/30/88 10.62 1,256,800 7.017150 0.660749 103.100901 1,084
10/31/88 10.66 1,386,748 6.577837 0.617058 103.717959 1,114
11/30/88 10.51 1,386,748 6.928360 0.659216 104.377175 1,098
12/30/88 0.0005 10.78 1,569,279 6.683375 0.619979 104.997154 1,121
01/31/89 0.0228 10.60 1,856,583 8.600317 0.811351 105.808504 1,122
02/28/89 10.61 2,040,325 6.083989 0.573420 106.381925 1,124
03/31/89 10.64 2,117,780 7.340353 0.689883 107.071807 1,122
04/28/89 10.96 2,211,555 6.595623 0.601790 107.673598 1,164
05/31/89 11.15 2,297,634 7.795568 0.699154 108.372752 1,192
06/30/89 11.15 2,423,878 6.751622 0.605527 108.978279 1,215
07/31/89 11.02 2,515,366 7.421421 0.673450 109.651729 1,224
08/31/89 10.95 2,579,708 7.346666 0.670928 110.322657 1,206
09/29/89 11.07 2,611,028 6.762779 0.610910 110.933568 1,200
10/31/89 11.03 2,722,479 7.521296 0.681894 111.615462 1,219
11/30/89 11.13 1,609,719 7.077536 0.635897 112.251359 1,243
12/29/89 0.0739 10.97 3,004,075 15.379671 1.401975 113.653335 1,251
01/31/90 10.85 3,029,448 6.046357 0.557268 114.210603 1,227
02/28/90 10.76 3,733,981 6.155951 0.572114 114.782717 1,235
03/30/90 10.76 3,337,849 6.140875 0.570713 115.353431 1,234
04/30/90 10.76 3,411,081 6.332903 0.588560 115.941990 1,219
05/31/90 10.83 3,301,132 6.631882 0.612362 116.554353 1,253
06/29/90 10.90 3,717,483 5.769440 0.529306 117.083659 1,268
07/31/90 10.85 3,820,763 6.638643 0.611857 117.695516 1,289
08/31/90 10.67 3,592,358 6.861649 0.643079 118.338594 1,252
09/29/90 10.57 3,830,047 5.869594 0.555307 118.893901 1,252
</TABLE>
<PAGE>
NET CIF: TAX-EXEMPT FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<S> <C> <C> <C> <C>
10/31/90 10.66 10/31/90 11/15/90 0.0571
11/30/90 10.89 11/30/90 12/14/90 0.0539
12/31/90 10.88 12/31/90 01/15/91 0.0547
01/31/91 10.95 01/31/91 02/15/91 0.0550
02/28/91 10.96 02/28/91 03/15/91 0.0540
03/28/91 10.94 03/28/91 04/15/91 0.0501
04/30/91 11.04 04/30/91 05/15/91 0.0572
05/31/91 11.05 05/31/91 06/14/91 0.0504
06/28/91 10.95 06/28/91 07/15/91 0.0496
07/31/91 11.07 07/31/91 08/15/91 0.0561
08/30/91 11.13 08/30/91 09/14/91 0.0542
09/30/91 11.21 09/30/91 10/15/91 0.0523
10/31/91 11.24 10/31/91 11/15/91 0.0526
11/29/91 11.22 11/29/91 12/13/91 0.0485
12/31/91 11.38 12/31/91 01/15/92 0.0542
01/31/92 11.37 01/31/92 02/14/92 0.0518
02/28/92 11.30 02/28/92 03/15/92 0.0487
03/31/92 11.29 03/31/92 04/15/92 0.0601
04/30/92 11.35 04/30/92 05/15/92 0.0499
05/29/92 11.44 05/29/92 06/16/92 0.0499
06/30/92 11.58 06/30/92 07/15/92 0.0527
07/31/92 12.00 07/31/92 08/14/92 0.0502
08/31/92 11.74 08/31/92 09/15/92 0.0516
09/30/92 11.72 09/30/92 10/15/92 0.0524
10/31/92 11.47 10/31/92 11/13/92 0.0518
11/30/92 11.7 11/30/92 12/15/92 0.0496
12/31/92 11.74 12/31/92 12/31/92 0.0505
01/29/93 11.8 01/29/93 02/12/93 0.0482
02/26/93 12.13 02/26/93 03/15/93 0.0449
03/31/93 12.09 03/31/93 04/15/93 0.0565
04/30/93 12.14 04/30/93 05/14/93 0.0497
05/28/93 12.17 05/28/93 06/15/93 0.0449
06/30/93 12.3 06/30/93 07/15/93 0.0499
07/30/93 12.25 07/30/93 08/16/93 0.0461
08/31/93 12.43 08/31/93 09/15/93 0.0483
09/30/93 12.59 09/30/93 10/15/93 0.0492
10/31/93 12.57 10/31/93 11/15/93 0.0469
11/30/93 12.41 11/30/93 12/15/93 0.0498
12/31/93 12.58 12/31/93 01/14/94 0.0490
01/31/94 12.66 01/31/94 02/15/94 0.0493
02/28/94 12.31 02/28/94 03/15/94 0.0502
03/31/94 11.82 03/31/94 04/15/94 0.0483
04/30/94 11.73 04/30/94 05/15/94 0.0474
05/31/94 11.77 05/31/94 06/15/94 0.0528
06/30/94 11.70 06/30/94 07/15/94 0.0513
07/29/94 11.82 07/29/94 08/15/94 0.0501
08/31/94 11.82 08/31/94 09/15/94 0.0541
09/30/94 11.57 09/30/94 10/15/94 0.0525
10/31/94 11.33 10/31/94 11/15/94 0.0523
11/30/94 11.01 11/30/94 12/15/94 0.0533
<S> <C> <C> <C> <C> <C> <C> <C>
10/31/90 10.88 4,038,241 6.788842 0.623974 119.517876 1,274
11/30/90 10.96 4,294,259 6.442013 0.587775 120.105651 1,308
12/31/90 0.0147 10.87 4,311,013 8.335332 0.766820 120.872470 1,315
01/31/91 11.12 4,665,829 6.647986 0.597840 121.470311 1,330
02/28/91 10.99 4,655,184 6.559397 0.596851 122.067162 1,338
03/28/91 11.04 4,747,680 6.115565 0.553946 122.621108 1,341
04/30/91 11.04 4,869,752 7.013927 0.635320 123.256428 1,361
05/31/91 10.90 5,318,177 6.212124 0.569920 123.826347 1,368
06/28/91 11.03 5,370,829 6.141787 0.556826 124.383173 1,362
07/31/91 11.15 5,625,261 6.977896 0.625820 125.008993 1,384
08/30/91 11.18 5,689,530 6.775487 0.606036 125.615030 1,398
09/30/91 11.26 3,832,831 6.569666 0.583452 126.198482 1,415
10/31/91 11.26 6,112,031 6.638040 0.589524 126.788006 1,425
11/29/91 11.28 6,508,228 6.149218 0.545143 127.333149 1,429
12/31/91 11.46 6,724,553 6.901457 0.602221 127.935370 1,456
01/31/92 11.30 6,979,104 6.627052 0.586465 128.521835 1,461
02/28/92 11.26 7,053,641 6.259013 0.555863 129.077698 1,459
03/31/92 11.42 7,118,759 7.757570 0.679297 129.756995 1,465
04/30/92 11.46 7,330,710 6.474874 0.564998 130.321992 1,479
05/29/92 11.50 7,621,702 6.503067 0.565484 130.887476 1,497
06/30/92 11.78 8,084,715 6.897770 0.585549 131.473026 1,522
07/31/92 11.94 8,608,385 6.599946 0.552759 132.025785 1,584
08/31/92 11.79 8,529,170 6.812531 0.577823 132.603608 1,557
09/30/92 11.67 8,637,959 6.948429 0.595410 133.199017 1,561
10/31/92 11.64 8,534,470 6.899709 0.592759 133.791776 1,535
11/30/92 11.77 9,184,242 6.636072 0.563812 134.355588 1,572
12/31/92 0.0413 11.74 9,250,893 12.333843 1.050583 135.406171 1,590
01/29/93 0.0074 11.92 9,645,668 7.528583 0.631593 136.037764 1,605
02/26/93 12.09 10,246,855 6.108096 0.505219 136.542982 1,656
03/31/93 12.19 10,859,516 7.714679 0.632869 137.175852 1,658
04/30/93 12.19 11,297,394 6.817640 0.559281 137.735133 1,672
05/28/93 12.21 12,303,691 6.184307 0.506495 138.241629 1,682
06/30/93 12.35 13,370,158 6.898257 0.558563 138.800192 1,707
07/30/93 12.38 14,328,028 6.398689 0.516857 139.317049 1,707
08/31/93 12.56 14,328,028 6.729013 0.535749 139.852798 1,738
09/30/93 12.71 15,130,849 6.880758 0.541366 140.394164 1,768
10/31/93 12.46 15,599,581 6.584486 0.528450 140.922614 1,771
11/30/93 12.57 15,907,412 7.017946 0.558309 141.480923 1,756
12/31/93 0.0028 12.61 16,406,372 7.328712 0.581183 142.062106 1,787
01/31/94 12.55 16,755,110 7.003662 0.558061 142.620166 1,806
02/28/94 12.06 16,599,778 7.159532 0.593659 143.213826 1,763
03/31/94 11.74 16,375,493 6.917228 0.589202 143.803027 1,700
04/30/94 11.69 16,016,440 6.816263 0.583085 144.386112 1,694
05/31/94 11.97 15,890,838 7.623587 0.636891 145.023003 1,707
06/30/94 11.75 15,741,588 7.439680 0.633164 145.656168 1,704
07/29/94 11.74 15,805,744 7.297374 0.621582 146.277750 1,729
08/31/94 11.75 15,476,818 7.913626 0.673500 146.951250 1,737
09/30/94 11.58 15,144,983 7.714941 0.666230 147.617480 1,708
10/31/94 11.05 14,601,995 7.720394 0.698678 148.316158 1,680
11/30/94 11.20 13,862,752 7.905251 0.705826 149.021984 1,641
</TABLE>
<PAGE>
NET CIF: TAX-EXEMPT FUND 12/31/87
RATE OF RETURN 12/31/95
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<S> <C> <C> <C> <C>
12/31/94 11.22 12/31/94 01/15/95 0.0567
01/31/95 11.39 01/31/95 02/15/95 0.0525
02/28/95 11.71 02/28/95 03/15/95 0.0530
03/31/95 11.81 03/31/95 04/15/95 0.0511
04/30/95 11.80 04/30/95 05/15/95 0.0486
05/31/95 12.05 05/31/95 06/15/95 0.0548
06/30/95 11.92 06/30/95 07/15/95 0.0518
07/31/95 11.94 07/31/95 08/15/95 0.0519
08/31/95 11.97 08/31/95 09/15/95 0.0523
09/30/95 11.98 09/30/95 10/15/95 0.0508
10/31/95 12.11 10/31/95 11/15/95 0.0530
11/30/95 12.27 11/30/95 12/15/95 0.0517
12/31/95 12.33 12/31/95 12/31/95 0.0498
<S> <C> <C> <C> <C> <C> <C> <C>
12/31/94 11.33 13,973,940 8.449546 0.745768 149.767751 1,680
01/31/95 0.0011 11.62 14,027,640 8.027551 0.690839 150.458591 1,714
02/28/95 11.79 14,390,550 7.974305 0.676362 151.134952 1,770
03/31/95 11.89 14,760,906 7.722996 0.649537 151.784490 1,793
04/30/95 11.96 7.376726 0.616783 152.401273 1,798
05/31/95 12.05 15,118,186 8.345036 0.692534 153.093807 1,845
06/30/95 12.06 15,101,454 7.930259 0.657567 153.751374 1,833
07/31/95 12.21 n/a 7.979696 0.653538 154.404912 1,844
08/31/95 12.45 14,678,329 8.075377 0.648625 155.053536 1,856
09/30/95 12.16 14,692,304 7.876720 0.647757 155.701293 1,865
10/31/95 12.18 15,083,403 8.252169 0.677518 156.378811 1,894
11/30/95 12.29 15,146,074 8.084785 0.657834 157.036645 1,927
12/31/95 0.0204 12.33 15,181,292 11.023972 0.894077 157.930722 1,947
</TABLE>
<PAGE>
GROSS CIF: TAX-EXEMPT FUND
RATE OF RETURN
1 YEAR PREPARED ON: 12/31/95
................
PURCHASE DATE: 12/31/94
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 11.22
SHARES PURCHASED: 89.12655971
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/94 11.22 12/31/94 01/15/95 0.0567
01/31/95 11.39 01/31/95 02/15/95 0.0525
02/28/95 11.71 02/28/95 03/15/95 0.0530
03/31/95 11.81 03/31/95 04/15/95 0.0511
04/30/95 11.80 04/30/95 05/15/95 0.0486
05/31/95 12.05 05/31/95 06/15/95 0.0548
06/30/95 11.92 06/30/95 07/15/95 0.0518
07/31/95 11.94 07/31/95 08/15/95 0.0519
08/31/95 11.97 08/31/95 09/15/95 0.0523
09/30/95 11.98 09/30/95 10/15/95 0.0508
10/31/95 12.11 10/31/95 11/15/95 0.0530
11/30/95 12.27 11/30/95 12/15/95 0.0517
12/31/95 12.33 12/31/95 12/31/95 0.0498
SHARES TO DATE X (NAV + NOT REINVESTED) GROSS VALUE
93.984331 12.33 1158.8268
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1158.8268 1,000.00 (158.8268)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(158.8268) 1,000.00 0.1588
ONE YEAR NET RATE OF RETURN: 15.88%
<CAPTION>
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/94 11.33 13,973,940 89.126560
01/31/95 0.0011 11.62 14,027,640 4.777184 0.411117 89.537677
02/28/95 11.79 14,390,550 4.745497 0.402502 89.940179
03/31/95 11.89 14,760,906 4.595943 0.386539 90.326717
04/30/95 11.96 4.389878 0.367047 90.693764
05/31/95 12.05 15,118,186 4.966118 0.412126 91.105890
06/30/95 12.06 15,101,454 4.719285 0.391317 91.497207
07/31/95 12.21 n/a 4.748705 0.388919 91.886127
08/31/95 12.45 14,678,329 4.805644 0.385996 92.272122
09/30/95 12.16 14,692,304 4.687424 0.385479 92.657601
10/31/95 12.18 15,083,403 4.910853 0.403190 93.060791
11/30/95 12.29 15,146,074 4.811243 0.391476 93.452267
12/31/95 0.0204 12.33 15,181,292 6.560349 0.532064 93.984331
</TABLE>
<PAGE>
GROSS CIF: TAX-EXEMPT FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
..............
PURCHASE DATE: 12/31/90
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 10.88
SHARES PURCHASED: 91.91176471
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/90 10.88 12/31/90 01/15/91 0.0547
01/31/91 10.95 01/31/91 02/15/91 0.0550
02/28/91 10.96 02/28/91 03/15/91 0.0540
03/28/91 10.94 03/28/91 04/15/91 0.0501
04/30/91 11.04 04/30/91 05/15/91 0.0572
05/31/91 11.05 05/31/91 06/14/91 0.0504
06/28/91 10.95 06/28/91 07/15/91 0.0496
07/31/91 11.07 07/31/91 08/15/91 0.0561
08/30/91 11.13 08/30/91 09/14/91 0.0542
09/30/91 11.21 09/30/91 10/15/91 0.0523
10/31/91 11.24 10/31/91 11/15/91 0.0526
11/29/91 11.22 11/29/91 12/13/91 0.0485
12/31/91 11.38 12/31/91 01/15/92 0.0542
01/31/92 11.37 01/31/92 02/14/92 0.0518
02/28/92 11.30 02/28/92 03/15/92 0.0487
03/31/92 11.29 03/31/92 04/15/92 0.0601
04/30/92 11.35 04/30/92 05/15/92 0.0499
05/29/92 11.44 05/29/92 06/16/92 0.0499
06/30/92 11.58 06/30/92 07/15/92 0.0527
07/31/92 12.00 07/31/92 08/14/92 0.0502
08/31/92 11.74 08/31/92 09/15/92 0.0516
09/30/92 11.72 09/30/92 10/15/92 0.0524
10/31/92 11.47 10/31/92 11/13/92 0.0518
11/30/92 11.7 11/30/92 12/15/92 0.0496
12/31/92 11.74 12/31/92 12/31/92 0.0505
01/29/93 11.8 01/29/93 02/12/93 0.0482
02/26/93 12.13 02/26/93 03/15/93 0.0449
03/31/93 12.09 03/31/93 04/15/93 0.0565
04/30/93 12.14 04/30/93 05/14/93 0.0497
05/28/93 12.17 05/28/93 06/15/93 0.0449
06/30/93 12.3 06/30/93 07/15/93 0.0499
07/30/93 12.25 07/30/93 08/16/93 0.0461
08/31/93 12.43 08/31/93 09/15/93 0.0483
09/30/93 12.59 09/30/93 10/15/93 0.0492
SHARES TO DATE X (NAV + NOT REINVESTED)GROSS VALUE
120.090963 12.33 1480.7216
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1480.7216 1,000.00 (480.7216)
NET VALUE / INITIAL INVESTMENT GROSS RATE OF RETURN
(480.7216) 1,000.00 0.4807
GROSS 5 YEAR RETURN: 48.07%
ANNUALIZED GROSS 5 YEAR RETURN: 8.17%
<CAPTION>
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/90 0.0147 10.87 4,311,013 91.911765
01/31/91 11.12 4,665,829 5.055147 0.454600 92.366364
02/28/91 10.99 4,655,184 4.987784 0.453847 92.820212
03/28/91 11.04 4,747,680 4.650293 0.421222 93.241434
04/30/91 11.04 4,869,752 5.333410 0.483099 93.724533
05/31/91 10.90 5,318,177 4.723716 0.433368 94.157901
06/28/91 11.03 5,370,829 4.670232 0.423412 94.581313
07/31/91 11.15 5,625,261 5.306012 0.475875 95.057188
08/30/91 11.18 5,689,530 5.152100 0.460832 95.518020
09/30/91 11.26 3,832,831 4.995592 0.443658 95.961678
10/31/91 11.26 6,112,031 5.047584 0.448276 96.409954
11/29/91 11.28 6,508,228 4.675883 0.414529 96.824483
12/31/91 11.46 6,724,553 5.247887 0.457931 97.282414
01/31/92 11.30 6,979,104 5.039229 0.445949 97.728363
02/28/92 11.26 7,053,641 4.759371 0.422680 98.151043
03/31/92 11.42 7,118,759 5.898878 0.516539 98.667582
04/30/92 11.46 7,330,710 4.923512 0.429626 99.097208
05/29/92 11.50 7,621,702 4.944951 0.429996 99.527203
06/30/92 11.78 8,084,715 5.245084 0.445253 99.972457
07/31/92 11.94 8,608,385 5.018617 0.420320 100.392776
08/31/92 11.79 8,529,170 5.180267 0.439378 100.832154
09/30/92 11.67 8,637,959 5.283605 0.452751 101.284905
10/31/92 11.64 8,534,470 5.246558 0.450735 101.735641
11/30/92 11.77 9,184,242 5.046088 0.428725 102.164365
12/31/92 0.0413 11.74 9,250,893 9.378689 0.798866 102.963231
01/29/93 0.0074 11.92 9,645,668 5.724756 0.480265 103.443496
02/26/93 12.09 10,246,855 4.644613 0.384170 103.827666
03/31/93 12.19 10,859,516 5.866263 0.481236 104.308902
04/30/93 12.19 11,297,394 5.184152 0.425279 104.734181
05/28/93 12.21 12,303,691 4.702565 0.385140 105.119321
06/30/93 12.35 13,370,158 5.245454 0.424733 105.544054
07/30/93 12.38 14,328,028 4.865581 0.393019 105.937074
08/31/93 12.56 14,328,028 5.116761 0.407385 106.344459
09/30/93 12.71 15,130,849 5.232147 0.411656 106.756115
</TABLE>
<PAGE>
GROSS CIF: TAX-EXEMPT FUND
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
..............
<TABLE>
<S> <C> <C> <C> <C>
10/31/93 12.57 10/31/93 11/15/93 0.0469
11/30/93 12.41 11/30/93 12/15/93 0.0498
12/31/93 12.58 12/31/93 01/14/94 0.0490
01/31/94 12.66 01/31/94 02/15/94 0.0493
02/28/94 12.31 02/28/94 03/15/94 0.0502
03/31/94 11.82 03/31/94 04/15/94 0.0483
04/30/94 11.73 04/30/94 05/15/94 0.0474
05/31/94 11.77 05/31/94 06/15/94 0.0528
06/30/94 11.70 06/30/94 07/15/94 0.0513
07/29/94 11.82 07/29/94 08/15/94 0.0501
08/31/94 11.82 08/31/94 09/15/94 0.0541
09/30/94 11.57 09/30/94 10/15/94 0.0525
10/31/94 11.33 10/31/94 11/15/94 0.0523
11/30/94 11.01 11/30/94 12/15/94 0.0533
12/31/94 11.22 12/31/94 01/15/95 0.0567
01/31/95 11.39 01/31/95 02/15/95 0.0525
02/28/95 11.71 02/28/95 03/15/95 0.0530
03/31/95 11.81 03/31/95 04/15/95 0.0511
04/30/95 11.80 04/30/95 05/15/95 0.0486
05/31/95 12.05 05/31/95 06/15/95 0.0548
06/30/95 11.92 06/30/95 07/15/95 0.0518
07/31/95 11.94 07/31/95 08/15/95 0.0519
08/31/95 11.97 08/31/95 09/15/95 0.0523
09/30/95 11.98 09/30/95 10/15/95 0.0508
10/31/95 12.11 10/31/95 11/15/95 0.0530
11/30/95 12.27 11/30/95 12/15/95 0.0517
12/31/95 12.33 12/31/95 12/31/95 0.0498
<S> <C> <C> <C> <C> <C> <C>
10/31/93 12.46 15,599,581 5.006862 0.401835 107.157950
11/30/93 12.57 15,907,412 5.336466 0.424540 107.582490
12/31/93 0.0028 12.61 16,406,372 5.572773 0.441933 108.024423
01/31/94 12.55 16,755,110 5.325604 0.424351 108.448774
02/28/94 12.06 16,599,778 5.444128 0.451420 108.900194
03/31/94 11.74 16,375,493 5.259879 0.448031 109.348224
04/30/94 11.69 16,016,440 5.183106 0.443379 109.791604
05/31/94 11.97 15,890,838 5.796997 0.484294 110.275898
06/30/94 11.75 15,741,588 5.657154 0.481460 110.757358
07/29/94 11.74 15,805,744 5.548944 0.472653 111.230010
08/31/94 11.75 15,476,818 6.017544 0.512131 111.742142
09/30/94 11.58 15,144,983 5.866462 0.506603 112.248745
10/31/94 11.05 14,601,995 5.870609 0.531277 112.780021
11/30/94 11.20 13,862,752 6.011175 0.536712 113.316734
12/31/94 11.33 13,973,940 6.425059 0.567084 113.883817
01/31/95 0.0011 11.62 14,027,640 6.104173 0.525316 114.409133
02/28/95 11.79 14,390,550 6.063684 0.514307 114.923441
03/31/95 11.89 14,760,906 5.872588 0.493910 115.417351
04/30/95 11.96 5.609283 0.469004 115.886354
05/31/95 12.05 15,118,186 6.345589 0.526605 116.412959
06/30/95 12.06 15,101,454 6.030191 0.500016 116.912975
07/31/95 12.21 n/a 6.067783 0.496952 117.409927
08/31/95 12.45 14,678,329 6.140539 0.493216 117.903143
09/30/95 12.16 14,692,304 5.989480 0.492556 118.395699
10/31/95 12.18 15,083,403 6.274972 0.515187 118.910885
11/30/95 12.29 15,146,074 6.147693 0.500219 119.411104
12/31/95 0.0204 12.33 15,181,292 8.382660 0.679859 120.090963
</TABLE>
<PAGE>
GROSS CIF: TAX-EXEMPT FUND
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 12/10/87
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 10.00
SHARES PURCHASED: 100.000
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/87 10.11 12/31/87 01/14/88 0.0369
01/29/88 10.51 01/29/88 02/12/88 0.0500
02/29/88 10.57 02/29/88 03/15/88 0.0800
03/31/88 10.18 03/31/88 04/15/88 0.0688
04/29/88 10.14 04/29/88 05/15/88 0.0640
05/31/88 10.08 05/31/88 06/15/88 0.0700
06/30/88 10.32 06/30/88 07/15/88 0.0600
07/29/88 10.27 07/29/88 08/15/88 0.0684
08/31/88 10.29 08/31/88 09/15/88 0.0682
09/30/88 10.51 09/30/88 10/14/88 0.0685
10/31/88 10.74 10/31/88 11/15/88 0.0638
11/30/88 10.52 11/30/88 12/15/88 0.0668
12/30/88 10.68 12/30/88 01/13/88 0.0635
01/31/89 10.60 01/31/89 02/15/89 0.0591
02/28/89 10.57 02/28/89 03/15/89 0.0575
03/31/89 10.48 03/31/89 04/14/89 0.0690
04/28/89 10.81 04/28/89 05/15/89 0.0616
05/31/89 11.00 05/31/89 06/15/89 0.0724
06/30/89 11.15 06/30/89 07/14/89 0.0623
07/31/89 11.16 07/31/89 08/15/89 0.0681
08/31/89 10.93 08/31/89 09/15/89 0.0670
09/29/89 10.82 09/29/89 10/13/89 0.0613
10/31/89 10.92 10/31/89 11/15/89 0.0678
11/30/89 11.07 11/30/89 12/15/89 0.0634
12/29/89 11.01 12/29/89 01/15/90 0.0631
01/31/90 10.74 01/31/90 02/15/90 0.0532
02/28/90 10.76 02/28/90 03/15/90 0.0539
03/30/90 10.70 03/30/90 04/12/90 0.0535
04/30/90 10.51 04/30/90 05/15/90 0.0549
05/31/90 10.75 05/31/90 06/15/90 0.0572
06/29/90 10.83 06/29/90 07/13/90 0.0495
07/31/90 10.95 07/31/90 08/15/90 0.0567
08/31/90 10.58 08/31/90 09/14/90 0.0583
09/29/90 10.53 09/29/90 10/15/90 0.0496
10/31/90 10.66 10/31/90 11/15/90 0.0571
162.826575 12.3 2007.6517
GROSS VALUE - INITIAL INVESTMENT =NET VALUE
2007.6517 1,000.00 (1007.6517)
NET VALUE / INITIAL INVESTMENT =GROSS RATE OF RETURN
(1007.6517) 1,000.00 1.0077
GROSS RATE OF RETURN SINCE INCEPTION: 100.77%
ANNUALIZED GROSS RATE OF RETURN SINCE INCEPTION: 9.03%
<CAPTION>
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/87 10.20 1,116,723 3.690000 0.361765 100.361765
01/29/88 10.62 1,168,306 5.018088 0.472513 100.834278
02/29/88 10.42 1,174,346 8.066742 0.774160 101.608437
03/31/88 10.18 1,139,983 6.990660 0.686705 102.295143
04/29/88 10.15 1,150,259 6.546889 0.645014 102.940156
05/31/88 10.37 1,143,877 7.205811 0.694871 103.635027
06/30/88 10.28 1,212,755 6.218102 0.604874 104.239901
07/29/88 10.25 1,212,755 7.130009 0.695611 104.935512
08/31/88 10.52 1,174,677 7.156602 0.680285 105.615797
09/30/88 10.62 1,256,800 7.234682 0.681232 106.297029
10/31/88 10.66 1,386,748 6.781750 0.636187 106.933215
11/30/88 10.51 1,386,748 7.143139 0.679652 107.612867
12/30/88 0.0005 10.78 1,569,279 6.890559 0.639198 108.252066
01/31/89 0.0228 10.60 1,856,583 8.866927 0.836503 109.088568
02/28/89 10.61 2,040,325 6.272593 0.591196 109.679764
03/31/89 10.64 2,117,780 7.567904 0.711269 110.391034
04/28/89 10.96 2,211,555 6.800088 0.620446 111.011479
05/31/89 11.15 2,297,634 8.037231 0.720828 111.732307
06/30/89 11.15 2,423,878 6.960923 0.624298 112.356605
07/31/89 11.02 2,515,366 7.651485 0.694327 113.050932
08/31/89 10.95 2,579,708 7.574412 0.691727 113.742660
09/29/89 11.07 2,611,028 6.972425 0.629849 114.372508
10/31/89 11.03 2,722,479 7.754456 0.703033 115.075542
11/30/89 11.13 1,609,719 7.296940 0.655610 115.731152
12/29/89 0.0739 10.97 3,004,075 15.856441 1.445437 117.176588
01/31/90 10.85 3,029,448 6.233794 0.574543 117.751132
02/28/90 10.76 3,733,981 6.346786 0.589850 118.340982
03/30/90 10.76 3,337,849 6.331243 0.588405 118.929387
04/30/90 10.76 3,411,081 6.529223 0.606805 119.536192
05/31/90 10.83 3,301,132 6.837470 0.631345 120.167538
06/29/90 10.90 3,717,483 5.948293 0.545715 120.713252
07/31/90 10.85 3,820,763 6.844441 0.630824 121.344077
08/31/90 10.67 3,592,358 7.074360 0.663014 122.007091
09/29/90 10.57 3,830,047 6.051552 0.572521 122.579612
10/31/90 10.88 4,038,241 6.999296 0.643318 123.222930
</TABLE>
<PAGE>
GROSS CIF: TAX-EXEMPT FUND
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
11/30/90 10.89 11/30/90 12/14/90 0.0539 10.96 4,294,259
12/31/90 10.88 12/31/90 01/15/91 0.0547 0.0147 10.87 4,311,013
01/31/91 10.95 01/31/91 02/15/91 0.0550 11.12 4,665,829
02/28/91 10.96 02/28/91 03/15/91 0.0540 10.99 4,655,184
03/28/91 10.94 03/28/91 04/15/91 0.0501 11.04 4,747,680
04/30/91 11.04 04/30/91 05/15/91 0.0572 11.04 4,869,752
05/31/91 11.05 05/31/91 06/14/91 0.0504 10.90 5,318,177
06/28/91 10.95 06/28/91 07/15/91 0.0496 11.03 5,370,829
07/31/91 11.07 07/31/91 08/15/91 0.0561 11.15 5,625,261
08/30/91 11.13 08/30/91 09/14/91 0.0542 11.18 5,689,530
09/30/91 11.21 09/30/91 10/15/91 0.0523 11.26 3,832,831
10/31/91 11.24 10/31/91 11/15/91 0.0526 11.26 6,112,031
11/29/91 11.22 11/29/91 12/13/91 0.0485 11.28 6,508,228
12/31/91 11.38 12/31/91 01/15/92 0.0542 11.46 6,724,553
01/31/92 11.37 01/31/92 02/14/92 0.0518 11.30 6,979,104
02/28/92 11.30 02/28/92 03/15/92 0.0487 11.26 7,053,641
03/31/92 11.29 03/31/92 04/15/92 0.0601 11.42 7,118,759
04/30/92 11.35 04/30/92 05/15/92 0.0499 11.46 7,330,710
05/29/92 11.44 05/29/92 06/16/92 0.0499 11.50 7,621,702
06/30/92 11.58 06/30/92 07/15/92 0.0527 11.78 8,084,715
07/31/92 12.00 07/31/92 08/14/92 0.0502 11.94 8,608,385
08/31/92 11.74 08/31/92 09/15/92 0.0516 11.79 8,529,170
09/30/92 11.72 09/30/92 10/15/92 0.0524 11.67 8,637,959
10/31/92 11.47 10/31/92 11/13/92 0.0518 11.64 8,534,470
11/30/92 11.7 11/30/92 12/15/92 0.0496 11.77 9,184,242
12/31/92 11.74 12/31/92 12/31/92 0.0505 0.0413 11.74 9,250,893
01/29/93 11.8 01/29/93 02/12/93 0.0482 0.0074 11.92 9,645,668
02/26/93 12.13 02/26/93 03/15/93 0.0449 12.09 10,246,855
03/31/93 12.09 03/31/93 04/15/93 0.0565 12.19 10,859,516
04/30/93 12.14 04/30/93 05/14/93 0.0497 12.19 11,297,394
05/28/93 12.17 05/28/93 06/15/93 0.0449 12.21 12,303,691
06/30/93 12.3 06/30/93 07/15/93 0.0499 12.35 13,370,158
07/30/93 12.25 07/30/93 08/16/93 0.0461 12.38 14,328,028
08/31/93 12.43 08/31/93 09/15/93 0.0483 12.56 14,328,028
09/30/93 12.59 09/30/93 10/15/93 0.0492 0.0000 12.71 15,130,849
10/31/93 12.57 10/31/93 11/15/93 0.0469 0.0000 12.46 15,599,581
11/30/93 12.41 11/30/93 12/15/93 0.0498 0.0000 12.57 15,907,412
12/31/93 12.58 12/31/93 01/14/94 0.0490 0.0028 12.61 16,406,372
01/31/94 12.66 01/31/94 02/15/94 0.0493 0.0000 12.55 16,755,110
02/28/94 12.31 02/28/94 03/15/94 0.0502 0.0000 12.06 16,599,778
03/31/94 11.82 03/31/94 04/15/94 0.0483 0.0000 11.74 16,375,493
04/30/94 11.73 04/30/94 05/15/94 0.0474 0.0000 11.69 16,016,440
05/31/94 11.77 05/31/94 06/15/94 0.0528 0.0000 11.97 15,890,838
06/30/94 11.70 06/30/94 07/15/94 0.0513 0.0000 11.75 15,741,588
07/29/94 11.82 07/29/94 08/15/94 0.0501 0.0000 11.74 15,805,744
08/31/94 11.82 08/31/94 09/15/94 0.0541 0.0000 11.75 15,476,818
09/30/94 11.5 09/30/94 10/15/94 0.0525 0.0000 11.58 15,144,983
10/31/94 11.33 10/31/94 11/15/94 0.0523 0.0000 11.05 14,601,995
11/30/94 11.01 11/30/94 12/15/94 0.0533 0.0000 11.20 13,862,752
12/31/94 11.22 12/31/94 01/15/95 0.0567 0.0000 11.33 13,973,940
<S> <C> <C> <C>
11/30/90 6.641716 0.605996 123.828926
12/31/90 8.593727 0.790591 124.619517
01/31/91 6.854073 0.616374 125.235890
02/28/91 6.762738 0.615354 125.851244
03/28/91 6.305147 0.571118 126.422363
04/30/91 7.231359 0.655014 127.077377
05/31/91 6.404700 0.587587 127.664964
06/28/91 6.332182 0.574087 128.239051
07/31/91 7.194211 0.645221 128.884272
08/30/91 6.985528 0.624824 129.509096
09/30/91 6.773326 0.601539 130.110634
10/31/91 6.843819 0.607799 130.718434
11/29/91 6.339844 0.562043 131.280477
12/31/91 7.115402 0.620890 131.901367
01/31/92 6.832491 0.604645 132.506012
02/28/92 6.453043 0.573094 133.079106
03/31/92 7.998054 0.700355 133.779461
04/30/92 6.675595 0.582513 134.361974
05/29/92 6.704663 0.583014 134.944988
06/30/92 7.111601 0.603701 135.548689
07/31/92 6.804544 0.569895 136.118584
08/31/92 7.023719 0.595735 136.714320
09/30/92 7.163830 0.613867 137.328187
10/31/92 7.113600 0.611134 137.939321
11/30/92 6.841790 0.581291 138.520611
12/31/92 12.716192 1.083151 139.603762
01/29/93 7.761969 0.651172 140.254934
02/26/93 6.297447 0.520881 140.775815
03/31/93 7.953834 0.652488 141.428303
04/30/93 7.028987 0.576619 142.004922
05/28/93 6.376021 0.522197 142.527119
06/30/93 7.112103 0.575879 143.102998
07/30/93 6.597048 0.532879 143.635877
08/31/93 6.937613 0.552358 144.188235
09/30/93 7.094061 0.558148 144.746383
10/31/93 6.788605 0.544832 145.291215
11/30/93 7.235503 0.575617 145.866832
12/31/93 7.555902 0.599199 146.466031
01/31/94 7.220775 0.575361 147.041391
02/28/94 7.381478 0.612063 147.653454
03/31/94 7.131662 0.607467 148.260921
04/30/94 7.027568 0.601161 148.862082
05/31/94 7.859918 0.656635 149.518717
06/30/94 7.670310 0.652792 150.171509
07/29/94 7.523593 0.640851 150.812360
08/31/94 8.158949 0.694379 151.506739
09/30/94 7.954104 0.686883 152.193622
10/31/94 7.959726 0.720337 152.913959
11/30/94 8.150314 0.727707 153.641665
12/31/94 8.711482 0.768886 154.410552
</TABLE>
<PAGE>
GROSS CIF: TAX-EXEMPT FUND
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
01/31/95 11.39 01/31/95 02/15/95 0.0525 0.0011 11.62 14,027,640
02/28/95 11.71 02/28/95 03/15/95 0.0530 0.0000 11.79 14,390,550
03/31/95 11.81 03/31/95 04/15/95 0.0511 0.0000 11.89 14,760,906
04/30/95 11.80 04/30/95 05/15/95 0.0486 0.0000 11.96
05/31/95 12.05 05/31/95 06/15/95 0.0548 0.0000 12.05 15,118,186
06/30/95 11.92 06/30/95 07/15/95 0.0518 0.0000 12.06 15,101,454
07/31/95 11.94 07/31/95 08/15/95 0.0519 0.0000 12.21 n/a
08/31/95 11.97 08/31/95 09/15/95 0.0523 0.0000 12.45 14,678,329
09/30/95 11.98 09/30/95 10/15/95 0.0508 0.0000 12.16 14,692,304
10/31/95 12.11 10/31/95 11/15/95 0.0530 0.0000 12.18 15,083,403
11/30/95 12.27 11/30/95 12/15/95 0.0517 0.0000 12.29 15,146,074
12/31/95 12.33 12/31/95 12/31/95 0.0498 0.0204 12.33 15,181,292
<S> <C> <C> <C>
01/31/95 8.276406 0.712255 155.122807
02/28/95 8.221509 0.697329 155.820136
03/31/95 7.962409 0.669673 156.489809
04/30/95 7.605405 0.635903 157.125712
05/31/95 8.603733 0.714003 157.839715
06/30/95 8.176097 0.677952 158.517667
07/31/95 8.227067 0.673797 159.191464
08/31/95 8.325714 0.668732 159.860196
09/30/95 8.120898 0.667837 160.528033
10/31/95 8.507986 0.698521 161.226554
11/30/95 8.335413 0.678227 161.904781
12/31/95 11.365716 0.921794 162.826575
</TABLE>
<PAGE>
NET CIF: GROWTH & INCOME
RATE OF RETURN
1 YEAR PREPARED ON: 12/31/95
................
PURCHASE DATE: 12/31/94
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 15.55 (5% SALES LOAD)
SHARES PURCHASED: 64.30868167
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/94 14.77 12/31/94 01/15/95 0.2473
01/31/95 14.88 01/31/95 02/15/95
02/28/95 15.60 02/28/95 03/15/95
03/31/95 16.01 03/31/95 04/15/95
04/30/95 16.56 04/30/95 05/15/95
05/31/95 17.21 05/31/95 06/15/95
06/30/95 18.05 06/30/95 07/15/95
07/31/95 18.91 07/31/95 08/15/95
08/31/95 19.10 08/31/95 09/15/95
09/30/95 19.61 09/30/95 10/15/95
10/31/95 19.12 10/31/95 11/15/95
11/30/95 19.77 11/30/95 12/15/95
12/31/95 18.58 12/31/95 12/31/95 0.2040
SHARES TO DATE X (NAV + NOT REINVESTED)GROSS VALUE
69.278587 18.58 1287.1961
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1287.1961 1,000.00 (287.1961)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(287.1961) 1,000.00 0.2872
ONE YEAR NET RATE OF RETURN: 28.72%
<CAPTION>
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/94 0.6447 15.02 18,679,228 64.308682
01/31/95 20,142,290 64.308682
02/28/95 21,268,096 64.308682
03/31/95 21,670,677 64.308682
04/30/95 21,670,677 64.308682
05/31/95 24,124,532 64.308682
06/30/95 25,333,506 64.308682
07/31/95 n/a 64.308682
08/31/95 27,133,862 64.308682
09/30/95 27,928,392 64.308682
10/31/95 27,342,653 64.308682
11/30/95 28,531,436 64.308682
12/31/95 1.2319 18.58 27,089,752 92.340836 4.969905 69.278587
</TABLE>
<PAGE>
NET CIF: GROWTH & INCOME
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
<TABLE>
<CAPTION>
SHARES TO DATE X (NAV + NOT REINVESTED)
108.751303 18.58
PURCHASE DATE: 12/31/90
INITIAL INVESTMENT: $1,000.00 GROSS VALUE - INITIAL INVESTMENT
INITIAL VALUE: 12.58 (5% SALES LOAD) 2020.5992 1,000.00
SHARES PURCHASED: 79.49125596
NET VALUE / INITIAL INVESTMENT
(1020.5992) 1,000.00
NET 5 YEAR RETURN: 102.06%
ANNUALIZED NET 5 YEAR RETURN: 15.11%
INCOME CAPITAL
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION DISTRIBUTIONS REINVEST NAV NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
12/31/90 11.95 12/31/90 01/15/91 0.2436 0.0045 11.61 1,770,675
01/31/91 12.53 01/31/91 02/15/91 1,972,423
02/28/91 13.22 02/28/91 03/15/91 2,242,891
03/28/91 13.17 03/28/91 04/15/91 0.0013 0.0109 13.42 2,366,425
04/30/91 13.51 04/30/91 05/15/91 2,504,380
05/31/91 14.45 05/31/91 06/14/91 2,833,866
06/28/91 13.85 06/28/91 07/15/91 2,978,522
07/31/91 14.32 07/31/91 08/15/91 3,378,836
08/30/91 14.62 08/30/91 09/14/91 3,717,903
09/30/91 14.56 09/30/91 10/15/91 3,848,309
10/31/91 14.83 10/31/91 11/15/91 4,082,393
11/29/91 14.27 11/29/91 12/13/91 4,038,028
12/31/91 14.83 12/31/91 01/15/92 0.2416 0.8650 15.15 4,412,808
01/31/92 14.84 01/31/92 02/14/92 4,920,111
02/28/92 15.19 02/28/92 03/15/92 4,964,902
03/31/92 14.90 03/31/92 04/15/92 0.1750 15.16 6,305,083
04/30/92 15.02 04/30/92 05/15/92 6,434,685
05/29/92 15.04 05/29/92 06/16/92 7,157,068
06/30/92 14.54 06/30/92 07/15/92 7,179,618
07/31/92 14.79 07/31/92 08/14/92
08/31/92 14.38 08/31/92 09/15/92 8,819,903
09/30/92 14.65 09/30/92 10/15/92 8,062,312
10/31/92 14.93 10/31/92 11/13/92 8,544,546
11/30/92 15.48 11/30/92 12/15/93 9,093,874
12/31/92 15.14 12/31/92 12/31/92 0.2143 0.3092 15.14 9,147,901
01/29/93 15.36 01/29/93 02/15/93 9,786,306
02/26/93 15.54 02/26/93 03/15/93 10,398,386
03/31/93 15.87 03/31/93 04/15/93 10,667,885
04/30/93 15.60 04/30/93 05/14/93 10,457,563
05/31/93 15.74 05/31/93 06/15/93 10,953,563
06/30/93 16.00 06/30/93 07/15/93 11,814,597
07/30/93 16.12 07/30/93 08/16/93 12,656,892
08/31/93 16.59 08/31/93 09/15/93 12,948,117
09/30/93 16.71 09/30/93 10/15/93 13,810,883
GROSS VALUE
2020.5992
NET VALUE
(1020.5992)
NET RATE OF RETURN
1.0206
<CAPTION>
SHARES TOTALS
DATE $ TO DIST. REINV. SHARES
<S> <C> <C> <C>
12/31/90 79.491256
01/31/91 79.491256
02/28/91 79.491256
03/28/91 0.969793 0.072265 79.563521
04/30/91 79.563521
05/31/91 79.563521
06/28/91 79.563521
07/31/91 79.563521
08/30/91 79.563521
09/30/91 79.563521
10/31/91 79.563521
11/29/91 79.563521
12/31/91 88.044992 5.811551 85.375071
01/31/92 85.375071
02/28/92 85.375071
03/31/92 14.940637 0.985530 86.360602
04/30/92 86.360602
05/29/92 86.360602
06/30/92 86.360602
07/31/92 86.360602
08/31/92 86.360602
09/30/92 86.360602
10/31/92 86.360602
11/30/92 86.360602
12/31/92 45.209775 2.986115 89.346716
01/29/93 89.346716
02/26/93 89.346716
03/31/93 89.346716
04/30/93 89.346716
05/31/93 89.346716
06/30/93 89.346716
07/30/93 89.346716
08/31/93 89.346716
09/30/93 89.346716
</TABLE>
<PAGE>
<TABLE>
NET CIF: GROWTH & INCOME
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
<S> <C> <C> <C> <C> <C> <C> <C>
10/31/93 17.03 10/31/93 11/15/93 14,246,439
11/30/93 16.74 11/30/93 12/15/93 14,525,321
12/31/93 16.70 12/31/93 01/14/94 0.2769 0.4786 16.87 14,885,337
01/31/94 17.23 01/31/94 02/15/94 17.08 16,842,517
02/28/94 16.91 02/28/94 03/15/94 17.14 17,409,079
03/31/94 15.89 03/31/94 04/15/94 0.3311 15.91 17,402,608
04/30/94 16.04 04/30/94 05/15/94 15.78 18,895,175
05/31/94 16.02 05/31/94 06/15/94 19,297,751
06/30/94 15.71 06/30/94 07/15/94 18,807,308
07/29/94 16.22 07/29/94 08/15/94 19,341,831
08/31/94 16.93 08/31/94 09/15/94 20,582,231
09/30/94 16.26 09/30/94 10/15/94 20,058,711
10/31/94 16.14 10/31/94 11/15/94 20,041,734
11/30/94 15.31 11/30/94 12/15/94 19,307,467
12/31/94 14.77 12/31/94 01/15/95 0.2473 0.6447 15.02 18,679,228
01/31/95 14.88 01/31/95 02/15/95 20,142,290
02/28/95 15.60 02/28/95 03/15/95 21,268,096
03/31/95 16.01 03/31/95 04/15/95 21,670,677
04/30/95 16.56 04/30/95 05/15/95 21,670,677
05/31/95 17.21 05/31/95 06/15/95 24,124,532
06/30/95 18.05 06/30/95 07/15/95 25,333,506
07/31/95 18.91 07/31/95 08/15/95 n/a
08/31/95 19.10 08/31/95 09/15/95 27,133,862
09/30/95 19.61 09/30/95 10/15/95 27,928,392
10/31/95 19.12 10/31/95 11/15/95 27,342,653
11/30/95 19.77 11/30/95 12/15/95 28,531,436
12/31/95 18.58 12/31/95 12/31/95 0.2040 1.2319 18.58 27,089,752
<S> <C> <C> <C>
10/31/93 89.346716
11/30/93 89.346716
12/31/93 67.501444 4.001271 93.347987
01/31/94 93.347987
02/28/94 93.347987
03/31/94 30.907519 1.942647 95.290635
04/30/94 95.290635
05/31/94 95.290635
06/30/94 95.290635
07/29/94 95.290635
08/31/94 95.290635
09/30/94 95.290635
10/31/94 95.290635
11/30/94 95.290635
12/31/94 84.999246 5.659071 100.949706
01/31/95 100.949706
02/28/95 100.949706
03/31/95 100.949706
04/30/95 100.949706
05/31/95 100.949706
06/30/95 100.949706
07/31/95 100.949706
08/31/95 100.949706
09/30/95 100.949706
10/31/95 100.949706
11/30/95 100.949706
12/31/95 144.953682 7.801598 108.751303
</TABLE>
<PAGE>
NET CIF: GROWTH & INCOME
RATE OF RETURN
SINCE PREPARED ON: 12/31/95 12/31/87
INCEPTION 12/31/95
...............
PURCHASE DATE: 12/18/87
INITIAL INVESTME $1,000.00
INITIAL VALUE: 11.17 (5% SALES LOAD)
SHARES PURCHASED 89.526
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/87 10.58 12/31/87 01/14/88 0.0203
01/31/88 10.35 01/29/88 02/12/88
02/29/88 11.06 02/29/88 03/15/88
03/31/88 10.74 03/31/88 04/15/88
04/29/88 11.05 04/29/88 05/15/88
05/31/88 10.52 05/31/88 06/15/88
06/30/88 11.54 06/30/88 07/15/88
07/29/88 11.16 07/29/88 08/15/88
08/31/88 10.62 08/31/88 09/15/88
09/30/88 10.77 09/30/88 10/14/88
10/31/88 10.83 10/31/88 11/15/88
11/30/88 10.80 11/30/88 12/15/88
12/30/88 10.83 12/30/88 01/13/88 0.2253
01/31/89 11.57 01/31/89 02/15/89
02/28/89 11.26 02/28/89 03/15/89
03/31/89 11.52 03/31/89 04/14/89
04/28/89 12.08 04/28/89 05/15/89
05/31/89 12.75 05/31/89 06/15/89
06/30/89 12.35 06/30/89 07/14/89
07/31/89 13.33 07/31/89 08/15/89
08/31/89 13.94 08/31/89 09/15/89
09/29/89 13.84 09/29/89 10/13/89
10/31/89 13.38 10/31/89 11/15/89
11/30/89 13.86 11/30/89 12/15/89
12/29/89 13.04 12/29/89 01/15/90 0.4143
01/31/90 12.32 01/31/90 02/15/90
02/28/90 12.94 02/28/90 03/15/90
03/30/90 12.72 03/30/90 04/12/90
04/30/90 12.36 04/30/90 05/15/90
05/31/90 13.40 05/31/90 06/15/90
06/29/90 13.36 06/29/90 07/13/90
07/31/90 13.54 07/31/90 08/15/90
08/31/90 12.36 08/31/90 09/14/90
09/29/90 11.81 09/29/90 10/15/90
SHARES TO DAX (NAV +NOT REINVESTE GROSS VALUE
145.375906 18.58 2701.0843
GROSS VALUE - INITIAL INVESTMENT NET VALUE
2701.0843 1,000.00 (1701.0843)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(1701.0843) 1,000.00 1.7011
NET RATE OF RETURN SINCE INCEPTION: 170.11%
ANNUALIZED NET RATE OF RETURN SINCE INCE 13.15%
<CAPTION>
CAPITAL SHARES TOTALS ACCOUNT
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
12/31/87 10.65 106,982 1.817367950 0.170644878 89.69615965 949
01/31/88 107,766 89.69615965 928
02/29/88 115,480 89.69615965 992
03/31/88 112,351 89.69615965 963
04/29/88 141,624 89.69615965 991
05/31/88 393,951 89.69615965 944
06/30/88 670,003 89.69615965 1,035
07/29/88 652,401 89.69615965 1,001
08/31/88 622,675 89.69615965 953
09/30/88 635,845 89.69615965 966
10/31/88 645,232 89.69615965 971
11/30/88 647,419 89.69615965 969
12/30/88 11.16 655,146 20.208544769 1.810801503 91.50696115 991
01/31/89 715,332 91.50696115 1,059
02/28/89 697,079 91.50696115 1,030
03/31/89 0.0396 11.83 729,265 3.626420870 0.306544452 91.81350560 1,058
04/28/89 782,885 91.81350560 1,109
05/31/89 832,024 91.81350560 1,171
06/30/89 812,486 91.81350560 1,134
07/31/89 890,227 91.81350560 1,224
08/31/89 931,499 91.81350560 1,280
09/29/89 946,813 91.81350560 1,271
10/31/89 918,187 91.81350560 1,228
11/30/89 960,679 91.81350560 1,273
12/29/89 0.8018 12.56 928,154 111.654404166 8.889681860 100.70318746 1,313
01/31/90 991,630 100.70318746 1,241
02/28/90 1,062,351 100.70318746 1,303
03/30/90 0.4213 12.72 1,048,696 42.426252879 3.335397239 104.03858470 1,323
04/30/90 104.03858470 1,286
05/31/90 1,238,868 104.03858470 1,394
06/29/90 1,311,319 104.03858470 1,390
07/31/90 1,476,656 104.03858470 1,409
08/31/90 1,427,689 104.03858470 1,286
09/29/90 1,413,608 104.03858470 1,229
</TABLE>
<PAGE>
NET CIF: GROWTH & INCOME
RATE OF RETURN
SINCE PREPARED ON: 12/31/95 12/31/87
INCEPTION 12/31/95
...............
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
10/31/90 11.46 10/31/90 11/15/90 1,445,962
11/30/90 12.06 11/30/90 12/14/90 1,631,224
12/31/90 11.95 12/31/90 01/15/91 0.2436 0.0045 11.61 1,770,675 25.811972865
01/31/91 12.53 01/31/91 02/15/91 1,972,423
02/28/91 13.22 02/28/91 03/15/91 2,242,891
03/28/91 13.17 03/28/91 04/15/91 0.0013 0.0109 13.42 2,366,425 1.296394426
04/30/91 13.51 04/30/91 05/15/91 2,504,380
05/31/91 14.45 05/31/91 06/14/91 2,833,866
06/28/91 13.850000 06/28/91 07/15/91 2,978,522
07/31/91 14.320000 07/31/91 08/15/91 3,378,836
08/30/91 14.62 08/30/91 09/14/91 3,717,903
09/30/91 14.56 09/30/91 10/15/91 3,848,309
10/31/91 14.83 10/31/91 11/15/91 4,082,393
11/29/91 14.27 11/29/91 12/13/91 4,038,028
12/31/91 14.83 12/31/91 01/15/92 0.2416 0.8650 15.15 4,412,808 117.696249540
01/31/92 14.84 01/31/92 02/14/92 4,920,111
02/28/92 15.19 02/28/92 03/15/92 4,964,902
03/31/92 14.90 03/31/92 04/15/92 0.1750 15.16 6,305,083 19.972254609
04/30/92 15.02 04/30/92 05/15/92 6,434,685
05/29/92 15.04 05/29/92 06/16/92 7,157,068
06/30/92 14.54 06/30/92 07/15/92 7,179,618
07/31/92 14.79 07/31/92 08/14/92
08/31/92 14.38 08/31/92 09/15/92 8,819,903
09/30/92 14.65 09/30/92 10/15/92 8,062,312
10/31/92 14.93 10/31/92 11/13/92 8,544,546
11/30/92 15.48 11/30/92 12/15/93 9,093,874
12/31/92 15.14 12/31/92 12/31/92 0.2143 0.3092 15.14 9,147,901 60.435248224
01/29/93 15.36 01/29/93 02/15/93 9,786,306
02/26/93 15.54 02/26/93 03/15/93 10,398,386
03/31/93 15.87 03/31/93 04/15/93 10,667,885
04/30/93 15.60 04/30/93 05/14/93 10,457,563
05/31/93 15.74 05/31/93 06/15/93 10,953,563
06/30/93 16.00 06/30/93 07/15/93 11,814,597
07/30/93 16.12 07/30/93 08/16/93 12,656,892
08/31/93 16.590000 08/31/93 09/15/93 12,948,117
09/30/93 16.71 09/30/93 10/15/93 13,810,883
10/31/93 17.03 10/31/93 11/15/93 14,246,439
11/30/93 16.74 11/30/93 12/15/93 14,525,321
12/31/93 16.70 12/31/93 01/14/94 0.2769 0.4786 16.87 14,885,337 90.234170250
01/31/94 17.23 01/31/94 02/15/94 17.08 16,842,517
02/28/94 16.91 02/28/94 03/15/94 17.14 17,409,079
03/31/94 15.89 03/31/94 04/15/94 0.3311 15.91 17,402,608 41.316364911
04/30/94 16.04 04/30/94 05/15/94 15.78 18,895,175
05/31/94 16.02 05/31/94 06/15/94 19,297,751
06/30/94 15.71 06/30/94 07/15/94 18,807,308
07/29/94 16.22 07/29/94 08/15/94 19,341,831
08/31/94 16.93 08/31/94 09/15/94 20,582,231
09/30/94 16.26 09/30/94 10/15/94 20,058,711
10/31/94 16.14 10/31/94 11/15/94 20,041,734
11/30/94 15.31 11/30/94 12/15/94 19,307,467
<CAPTION>
<S> <C> <C>
10/31/90 104.03858470 1,192
11/30/90 104.03858470 1,255
12/31/90 2.223253 106.26183818 1,270
01/31/91 106.26183818 1,331
02/28/91 106.26183818 1,405
03/28/91 0.096601671 106.35843985 1,401
04/30/91 106.35843985 1,437
05/31/91 106.35843985 1,537
06/28/91 106.35843985 1,473
07/31/91 106.35843985 1,523
08/30/91 106.35843985 1,555
09/30/91 106.35843985 1,549
10/31/91 106.35843985 1,577
11/29/91 106.35843985 1,518
12/31/91 7.768729343 114.12716919 1,693
01/31/92 114.12716919 1,694
02/28/92 114.12716919 1,734
03/31/92 1.317431043 115.44460024 1,720
04/30/92 115.44460024 1,734
05/29/92 115.44460024 1,736
06/30/92 115.44460024 1,679
07/31/92 115.44460024 1,707
08/31/92 115.44460024 1,660
09/30/92 115.44460024 1,691
10/31/92 115.44460024 1,724
11/30/92 115.44460024 1,787
12/31/92 3.991760120 119.43636036 1,808
01/29/93 119.43636036 1,835
02/26/93 119.43636036 1,856
03/31/93 119.43636036 1,895
04/30/93 119.43636036 1,863
05/31/93 119.43636036 1,880
06/30/93 119.43636036 1,911
07/30/93 119.43636036 1,925
08/31/93 119.43636036 1,981
09/30/93 119.43636036 1,996
10/31/93 119.43636036 2,034
11/30/93 119.43636036 1,999
12/31/93 5.348794917 124.78515527 2,084
01/31/94 124.78515527 2,150
02/28/94 124.78515527 2,110
03/31/94 2.596880258 127.38203553 2,024
04/30/94 127.38203553 2,043
05/31/94 127.38203553 2,041
06/30/94 127.38203553 2,001
07/29/94 127.38203553 2,066
08/31/94 127.38203553 2,157
09/30/94 127.38203553 2,071
10/31/94 127.38203553 2,056
11/30/94 127.38203553 1,950
</TABLE>
<PAGE>
NET CIF: GROWTH & INCOME
RATE OF RETURN
SINCE PREPARED ON: 12/31/95 12/31/95
INCEPTION 12/31/95
...............
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
12/31/94 14.77 12/31/94 01/15/95 0.2473 0.6447 15.02
01/31/95 14.88 01/31/95 02/15/95
02/28/95 15.60 02/28/95 03/15/95
03/31/95 16.01 03/31/95 04/15/95
04/30/95 16.56 04/30/95 05/15/95
05/31/95 17.21 05/31/95 06/15/95
06/30/95 18.05 06/30/95 07/15/95
07/31/95 18.91 07/31/95 08/15/95
08/31/95 19.10 08/31/95 09/15/95
09/30/95 19.61 09/30/95 10/15/95
10/31/95 19.12 10/31/95 11/15/95
11/30/95 19.77 11/30/95 12/15/95
12/31/95 18.58 12/31/95 12/31/95 0.2040 1.2319 18.58
<S> <C> <C> <C> <C> <C>
12/31/94 18,679,228 113.624775695 7.564898515 134.94693405 1,993
01/31/95 20,142,290 134.94693405 2,008
02/28/95 21,268,096 134.94693405 2,105
03/31/95 21,670,677 134.94693405 2,161
04/30/95 21,670,677 134.94693405 2,235
05/31/95 24,124,532 134.94693405 2,322
06/30/95 25,333,506 134.94693405 2,436
07/31/95 n/a 134.94693405 2,552
08/31/95 27,133,862 134.94693405 2,577
09/30/95 27,928,392 134.94693405 2,646
10/31/95 27,342,653 134.94693405 2,580
11/30/95 28,531,436 134.94693405 2,668
12/31/95 27,089,752 193.770302599 ************ 145.37590620 2,701
</TABLE>
<PAGE>
GROSS CIF: GROWTH & INCOME
RATE OF RETURN
1 YEAR PREPARED ON: 12/31/95
................
PURCHASE DATE: 12/31/94
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 14.77
SHARES PURCHASED: 67.70480704
<TABLE>
<CAPTION>
DATE NAV EX-DATE PAYABLE DATE
<S> <C> <C> <C>
12/31/94 14.77 12/31/94 01/15/95
01/31/95 14.88 01/31/95 02/15/95
02/28/95 15.60 02/28/95 03/15/95
03/31/95 16.01 03/31/95 04/15/95
04/30/95 16.56 04/30/95 05/15/95
05/31/95 17.21 05/31/95 06/15/95
06/30/95 18.05 06/30/95 07/15/95
07/31/95 18.91 07/31/95 08/15/95
08/31/95 19.10 08/31/95 09/15/95
09/30/95 19.61 09/30/95 10/15/95
10/31/95 19.12 10/31/95 11/15/95
11/30/95 19.77 11/30/95 12/15/95
12/31/95 18.58 12/31/95 12/31/95
SHARES TO DATE X (NAV + NOT REINVESTED) GROSS VALUE
72.937172 18.58 1355.1726
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1355.1726 1,000.00 (355.1726)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(355.1726) 1,000.00 0.3552
ONE YEAR NET RATE OF RETURN: 35.52%
<CAPTION>
INCOME CAPITAL SHARES TOTALS
DATE DISTRIBUTION DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C> <C>
12/31/94 0.2473 0.6447 15.02 18,679,228 67.704807
01/31/95 20,142,290 67.704807
02/28/95 21,268,096 67.704807
03/31/95 21,670,677 67.704807
04/30/95 21,670,677 67.704807
05/31/95 24,124,532 67.704807
06/30/95 25,333,506 67.704807
07/31/95 n/a 67.704807
08/31/95 27,133,862 67.704807
09/30/95 27,928,392 67.704807
10/31/95 27,342,653 67.704807
11/30/95 28,531,436 67.704807
12/31/95 0.2040 1.2319 18.58 27,089,752 97.217332 5.232365 72.937172
</TABLE>
<PAGE>
GROSS CIF: GROWTH & INCOME
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
PURCHASE DATE: 12/31/90
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 11.95
SHARES PURCHASED: 83.68200837
<TABLE>
<CAPTION>
DATE NAV EX-DATE PAYABLE DATE
<S> <C> <C> <C>
12/31/90 11.95 12/31/90 01/15/91
01/31/91 12.53 01/31/91 02/15/91
02/28/91 13.22 02/28/91 03/15/91
03/28/91 13.17 03/28/91 04/15/91
04/30/91 13.51 04/30/91 05/15/91
05/31/91 14.45 05/31/91 06/14/91
06/28/91 13.85 06/28/91 07/15/91
07/31/91 14.32 07/31/91 08/15/91
08/30/91 14.62 08/30/91 09/14/91
09/30/91 14.56 09/30/91 10/15/91
10/31/91 14.83 10/31/91 11/15/91
11/29/91 14.27 11/29/91 12/13/91
12/31/91 14.83 12/31/91 01/15/92
01/31/92 14.84 01/31/92 02/14/92
02/28/92 15.19 02/28/92 03/15/92
03/31/92 14.90 03/31/92 04/15/92
04/30/92 15.02 04/30/92 05/15/92
05/29/92 15.04 05/29/92 06/16/92
06/30/92 14.54 06/30/92 07/15/92
07/31/92 14.79 07/31/92 08/14/92
08/31/92 14.38 08/31/92 09/15/92
09/30/92 14.65 09/30/92 10/15/92
10/31/92 14.93 10/31/92 11/13/92
11/30/92 15.48 11/30/92 12/15/93
12/31/92 15.14 12/31/92 12/31/92
01/29/93 15.36 01/29/93 02/15/93
02/26/93 15.54 02/26/93 03/15/93
03/31/93 15.87 03/31/93 04/15/93
04/30/93 15.60 04/30/93 05/14/93
05/31/93 15.74 05/31/93 06/15/93
06/30/93 16.00 06/30/93 07/15/93
07/30/93 16.12 07/30/93 08/16/93
08/31/93 16.59 08/31/93 09/15/93
09/30/93 16.71 09/30/93 10/15/93
SHARES TO DATE X (NAV + NOT REINVESTED)GROSS VALUE
114.484635 18.58 2127.1245
GROSS VALUE - INITIAL INVESTMENT NET VALUE
2127.1245 1,000.00 (1127.1245)
NET VALUE / INITIAL INVESTMENT GROSS RATE OF RETURN
(1127.1245) 1,000.00 1.1271
GROSS 5 YEAR RETURN: 112.71%
ANNUALIZED GROSS 5 YEAR RETURN: 16.29%
<CAPTION>
INCOME CAPITAL SHARES TOTALS
DATE DISTRIBUTION DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C> <C>
12/31/90 0.2436 0.0045 11.61 1,770,675 83.682008
01/31/91 1,972,423 83.682008
02/28/91 2,242,891 83.682008
03/28/91 0.0013 0.0109 13.42 2,366,425 1.020921 0.076075 83.758083
04/30/91 2,504,380 83.758083
05/31/91 2,833,866 83.758083
06/28/91 2,978,522 83.758083
07/31/91 3,378,836 83.758083
08/30/91 3,717,903 83.758083
09/30/91 3,848,309 83.758083
10/31/91 4,082,393 83.758083
11/29/91 4,038,028 83.758083
12/31/91 0.2416 0.8650 15.15 4,412,808 92.686695 6.117934 89.876017
01/31/92 4,920,111 89.876017
02/28/92 4,964,902 89.876017
03/31/92 0.1750 15.16 6,305,083 15.728303 1.037487 90.913504
04/30/92 6,434,685 90.913504
05/29/92 7,157,068 90.913504
06/30/92 7,179,618 90.913504
07/31/92 90.913504
08/31/92 8,819,903 90.913504
09/30/92 8,062,312 90.913504
10/31/92 8,544,546 90.913504
11/30/92 9,093,874 90.913504
12/31/92 0.2143 0.3092 15.14 9,147,901 47.593219 3.143542 94.057045
01/29/93 9,786,306 94.057045
02/26/93 10,398,386 94.057045
03/31/93 10,667,885 94.057045
04/30/93 10,457,563 94.057045
05/31/93 10,953,563 94.057045
06/30/93 11,814,597 94.057045
07/30/93 12,656,892 94.057045
08/31/93 12,948,117 94.057045
09/30/93 13,810,883 94.057045
</TABLE>
<PAGE>
GROSS CIF: GROWTH & INCOME
RATE OF RETURN
5 YEAR PREPARED ON: 12/31/95
ROLLING
................
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
10/31/93 17.03 10/31/93 11/15/93 14,246,439
11/30/93 16.74 11/30/93 12/15/93 14,525,321
12/31/93 16.70 12/31/93 01/14/94 0.2769 0.4786 16.87 14,885,337
01/31/94 17.23 01/31/94 02/15/94 17.08 16,842,517
02/28/94 16.91 02/28/94 03/15/94 17.14 17,409,079
03/31/94 15.89 03/31/94 04/15/94 0.3311 15.91 17,402,608
04/30/94 16.04 04/30/94 05/15/94 15.78 18,895,175
05/31/94 16.02 05/31/94 06/15/94 19,297,751
06/30/94 15.71 06/30/94 07/15/94 18,807,308
07/29/94 16.22 07/29/94 08/15/94 19,341,831
08/31/94 16.93 08/31/94 09/15/94 20,582,231
09/30/94 16.26 09/30/94 10/15/94 20,058,711
10/31/94 16.14 10/31/94 11/15/94 20,041,734
11/30/94 15.31 11/30/94 12/15/94 19,307,467
12/31/94 14.77 12/31/94 01/15/95 0.2473 0.6447 15.02 18,679,228
01/31/95 14.88 01/31/95 02/15/95 20,142,290
02/28/95 15.60 02/28/95 03/15/95 21,268,096
03/31/95 16.01 03/31/95 04/15/95 21,670,677
04/30/95 16.56 04/30/95 05/15/95 21,670,677
05/31/95 17.21 05/31/95 06/15/95 24,124,532
06/30/95 18.05 06/30/95 07/15/95 25,333,506
07/31/95 18.91 07/31/95 08/15/95 n/a
08/31/95 19.10 08/31/95 09/15/95 27,133,862
09/30/95 19.61 09/30/95 10/15/95 27,928,392
10/31/95 19.12 10/31/95 11/15/95 27,342,653
11/30/95 19.77 11/30/95 12/15/95 28,531,436
12/31/95 18.58 12/31/95 12/31/95 0.2040 1.2319 18.58 27,089,752
<S> <C> <C> <C>
10/31/93 94.057045
11/30/93 94.057045
12/31/93 71.060098 4.212217 98.269262
01/31/94 98.269262
02/28/94 98.269262
03/31/94 32.536953 2.045063 100.314325
04/30/94 100.314325
05/31/94 100.314325
06/30/94 100.314325
07/29/94 100.314325
08/31/94 100.314325
09/30/94 100.314325
10/31/94 100.314325
11/30/94 100.314325
12/31/94 89.480378 5.957415 106.271740
01/31/95 106.271740
02/28/95 106.271740
03/31/95 106.271740
04/30/95 106.271740
05/31/95 106.271740
06/30/95 106.271740
07/31/95 106.271740
08/31/95 106.271740
09/30/95 106.271740
10/31/95 106.271740
11/30/95 106.271740
12/31/95 152.595592 8.212895 114.484635
</TABLE>
<PAGE>
GROSS CIF: GROWTH & INCOME
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 12/18/87
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 10.61
SHARES PURCHASED: 94.251
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
12/31/87 10.58 12/31/87 01/14/88 0.0203
01/31/88 10.35 01/29/88 02/12/88 0.0000
02/29/88 11.06 02/29/88 03/15/88
03/31/88 10.74 03/31/88 04/15/88
04/29/88 11.05 04/29/88 05/15/88
05/31/88 10.52 05/31/88 06/15/88
06/30/88 11.54 06/30/88 07/15/88
07/29/88 11.16 07/29/88 08/15/88
08/31/88 10.62 08/31/88 09/15/88
09/30/88 10.77 09/30/88 10/14/88
10/31/88 10.83 10/31/88 11/15/88
11/30/88 10.80 11/30/88 12/15/88
12/30/88 10.83 12/30/88 01/13/88 0.2253
01/31/89 11.57 01/31/89 02/15/89 0.0000
02/28/89 11.26 02/28/89 03/15/89 0.0000
03/31/89 11.52 03/31/89 04/14/89
04/28/89 12.08 04/28/89 05/15/89
05/31/89 12.75 05/31/89 06/15/89
06/30/89 12.35 06/30/89 07/14/89
07/31/89 13.33 07/31/89 08/15/89
08/31/89 13.94 08/31/89 09/15/89
09/29/89 13.84 09/29/89 10/13/89
10/31/89 13.38 10/31/89 11/15/89
11/30/89 13.86 11/30/89 12/15/89
12/29/89 13.04 12/29/89 01/15/90 0.4143
01/31/90 12.32 01/31/90 02/15/90 0.0000
02/28/90 12.94 02/28/90 03/15/90 0.0000
03/30/90 12.72 03/30/90 04/12/90
04/30/90 12.36 04/30/90 05/15/90
05/31/90 13.40 05/31/90 06/15/90
06/29/90 13.36 06/29/90 07/13/90
07/31/90 13.54 07/31/90 08/15/90
08/31/90 12.36 08/31/90 09/14/90
09/29/90 11.81 09/29/90 10/15/90
10/31/90 11.46 10/31/90 11/15/90
153.048904 18.58 0 2843.6486
GROSS VALUE - INITIAL INVESTMENT =NET VALUE
2843.6486 1,000.00 (1843.6486)
NET VALUE / INITIAL INVESTMENT =GROSS RATE OF RETURN
(1843.6486) 1,000.00 1.8436
GROSS RATE OF RETURN SINCE INCEPTION: 184.36%
ANNUALIZED GROSS RATE OF RETURN SINCE INCEPTION: 13.88%
<CAPTION>
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
12/31/87 10.65 106,982 1.913289 0.179652 94.430358
01/31/88 0.00 107,766 0.000000 0.000000 94.430358
02/29/88 115,480 0.000000 0.000000 94.430358
03/31/88 112,351 0.000000 0.000000 94.430358
04/29/88 141,624 0.000000 0.000000 94.430358
05/31/88 393,951 0.000000 0.000000 94.430358
06/30/88 670,003 0.000000 0.000000 94.430358
07/29/88 652,401 0.000000 0.000000 94.430358
08/31/88 622,675 0.000000 0.000000 94.430358
09/30/88 635,845 0.000000 0.000000 94.430358
10/31/88 645,232 0.000000 0.000000 94.430358
11/30/88 647,419 0.000000 0.000000 94.430358
12/30/88 11.16 655,146 21.275160 1.906376 96.336735
01/31/89 0.0000 0.00 715,332 0.000000 0.000000 96.336735
02/28/89 0.00 697,079 0.000000 0.000000 96.336735
03/31/89 0.0396 11.83 729,265 3.817825 0.322724 96.659459
04/28/89 782,885 0.000000 0.000000 96.659459
05/31/89 832,024 0.000000 0.000000 96.659459
06/30/89 812,486 0.000000 0.000000 96.659459
07/31/89 890,227 0.000000 0.000000 96.659459
08/31/89 931,499 0.000000 0.000000 96.659459
09/29/89 946,813 0.000000 0.000000 96.659459
10/31/89 918,187 0.000000 0.000000 96.659459
11/30/89 960,679 0.000000 0.000000 96.659459
12/29/89 0.8018 12.56 928,154 117.547568 9.358883 106.018342
01/31/90 0.00 991,630 0.000000 0.000000 106.018342
02/28/90 0.00 1,062,351 0.000000 0.000000 106.018342
03/30/90 0.4213 12.72 1,048,696 44.665527 3.511441 109.529782
04/30/90 0 0.000000 0.000000 109.529782
05/31/90 1,238,868 0.000000 0.000000 109.529782
06/29/90 1,311,319 0.000000 0.000000 109.529782
07/31/90 1,476,656 0.000000 0.000000 109.529782
08/31/90 1,427,689 0.000000 0.000000 109.529782
09/29/90 1,413,608 0.000000 0.000000 109.529782
10/31/90 1,445,962 0.000000 0.000000 109.529782
</TABLE>
<PAGE>
GROSS CIF: GROWTH & INCOME
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
11/30/90 12.06 11/30/90 12/14/90 1,631,224
12/31/90 11.95 12/31/90 01/15/91 0.2436 0.0045 11.61 1,770,675
01/31/91 12.53 01/31/91 02/15/91 0.0000 0.00 1,972,423
02/28/91 13.22 02/28/91 03/15/91 0.0000 0.00 2,242,891
03/28/91 13.17 03/28/91 04/15/91 0.0013 0.0109 13.42 2,366,425
04/30/91 13.51 04/30/91 05/15/91 2,504,380
05/31/91 14.45 05/31/91 06/14/91 2,833,866
06/28/91 13.85 06/28/91 07/15/91 2,978,522
07/31/91 14.32 07/31/91 08/15/91 3,378,836
08/30/91 14.62 08/30/91 09/14/91 3,717,903
09/30/91 14.56 09/30/91 10/15/91 3,848,309
10/31/91 14.83 10/31/91 11/15/91 4,082,393
11/29/91 14.27 11/29/91 12/13/91 0.0000 0.00 4,038,028
12/31/91 14.83 12/31/91 01/15/92 0.2416 0.8650 15.15 4,412,808
01/31/92 14.84 01/31/92 02/14/92 4,920,111
02/28/92 15.19 02/28/92 03/15/92 4,964,902
03/31/92 14.90 03/31/92 04/15/92 0.1750 15.16 6,305,083
04/30/92 15.02 04/30/92 05/15/92 6,434,685
05/29/92 15.04 05/29/92 06/16/92 7,157,068
06/30/92 14.54 06/30/92 07/15/92 7,179,618
07/31/92 14.79 07/31/92 08/14/92 0
08/31/92 14.38 08/31/92 09/15/92 8,819,903
09/30/92 14.65 09/30/92 10/15/92 8,062,312
10/31/92 14.93 10/31/92 11/13/92 8,544,546
11/30/92 15.48 11/30/92 12/15/93 9,093,874
12/31/92 15.14 12/31/92 12/31/92 0.2143 0.3092 15.14 9,147,901
01/29/93 15.36 01/29/93 02/15/93 9,786,306
02/26/93 15.54 02/26/93 03/15/93 10,398,386
03/31/93 15.87 03/31/93 04/15/93 10,667,885
04/30/93 15.60 04/30/93 05/14/93 10,457,563
05/31/93 15.74 05/31/93 06/15/93 10,953,563
06/30/93 16.00 06/30/93 07/15/93 11,814,597
07/30/93 16.12 07/30/93 08/16/93 12,656,892
08/31/93 16.59 08/31/93 09/15/93 0.00 12,948,117
09/30/93 16.71 09/30/93 10/15/93 0.0000 0.0000 0.00 13,810,883
10/31/93 17.03 10/31/93 11/15/93 0.0000 0.0000 0.00 14,246,439
11/30/93 16.74 11/30/93 12/15/93 0.0000 0.0000 0.00 14,525,321
12/31/93 16.70 12/31/93 01/14/94 0.2769 0.4786 16.87 14,885,337
01/31/94 17.23 01/31/94 02/15/94 0.0000 0.0000 17.08 16,842,517
02/28/94 16.91 02/28/94 03/15/94 0.0000 0.0000 17.14 17,409,079
03/31/94 15.89 03/31/94 04/15/94 0.0000 0.3311 15.91 17,402,608
04/30/94 16.04 04/30/94 05/15/94 0.0000 0.0000 15.78 18,895,175
05/31/94 16.02 05/31/94 06/15/94 0.0000 0.0000 19,297,751
06/30/94 15.71 06/30/94 07/15/94 0.0000 0.0000 18,807,308
07/29/94 16.22 07/29/94 08/15/94 0.0000 0.0000 19,341,831
08/31/94 16.93 08/31/94 09/15/94 0.0000 0.0000 20,582,231
09/30/94 16.26 09/30/94 10/15/94 0.0000 0.0000 20,058,711
10/31/94 16.14 10/31/94 11/15/94 0.0000 0.0000 20,041,734
11/30/94 15.31 11/30/94 12/15/94 0.0000 0.0000 19,307,467
12/31/94 14.77 12/31/94 01/15/95 0.2473 0.6447 15.02 18,679,228
<CAPTION>
<S> <C> <C> <C>
11/30/90 0.000000 0.000000 109.529782
12/31/90 27.174339 2.340598 111.870380
01/31/91 0.000000 0.000000 111.870380
02/28/91 0.000000 0.000000 111.870380
03/28/91 1.364819 0.101700 111.972080
04/30/91 0.000000 0.000000 111.972080
05/31/91 0.000000 0.000000 111.972080
06/28/91 0.000000 0.000000 111.972080
07/31/91 0.000000 0.000000 111.972080
08/30/91 0.000000 0.000000 111.972080
09/30/91 0.000000 0.000000 111.972080
10/31/91 0.000000 0.000000 111.972080
11/29/91 0.000000 0.000000 111.972080
12/31/91 123.908304 8.178766 120.150846
01/31/92 0.000000 0.000000 120.150846
02/28/92 0.000000 0.000000 120.150846
03/31/92 21.026398 1.386966 121.537812
04/30/92 0.000000 0.000000 121.537812
05/29/92 0.000000 0.000000 121.537812
06/30/92 0.000000 0.000000 121.537812
07/31/92 0.000000 0.000000 121.537812
08/31/92 0.000000 0.000000 121.537812
09/30/92 0.000000 0.000000 121.537812
10/31/92 0.000000 0.000000 121.537812
11/30/92 0.000000 0.000000 121.537812
12/31/92 63.625045 4.202447 125.740259
01/29/93 0.000000 0.000000 125.740259
02/26/93 0.000000 0.000000 125.740259
03/31/93 0.000000 0.000000 125.740259
04/30/93 0.000000 0.000000 125.740259
05/31/93 0.000000 0.000000 125.740259
06/30/93 0.000000 0.000000 125.740259
07/30/93 0.000000 0.000000 125.740259
08/31/93 0.000000 0.000000 125.740259
09/30/93 0.000000 0.000000 125.740259
10/31/93 0.000000 0.000000 125.740259
11/30/93 0.000000 0.000000 125.740259
12/31/93 94.996765 5.631106 131.371365
01/31/94 0.000000 0.000000 131.371365
02/28/94 0.000000 0.000000 131.371365
03/31/94 43.497059 2.733945 134.105310
04/30/94 0.000000 0.000000 134.105310
05/31/94 0.000000 0.000000 134.105310
06/30/94 0.000000 0.000000 134.105310
07/29/94 0.000000 0.000000 134.105310
08/31/94 0.000000 0.000000 134.105310
09/30/94 0.000000 0.000000 134.105310
10/31/94 0.000000 0.000000 134.105310
11/30/94 0.000000 0.000000 134.105310
12/31/94 119.621936 7.964177 142.069487
</TABLE>
<PAGE>
GROSS CIF: GROWTH & INCOME
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
01/31/95 14.88 01/31/95 02/15/95 0.0000 0.0000 20,142,290
02/28/95 15.60 02/28/95 03/15/95 0.0000 0.0000 0.00 21,268,096
03/31/95 16.01 03/31/95 04/15/95 0.0000 0.0000 0.00 21,670,677
04/30/95 16.56 04/30/95 05/15/95 0.0000 0.0000 0.00 21,670,677
05/31/95 17.21 05/31/95 06/15/95 0.0000 0.0000 0.00 24,124,532
06/30/95 18.05 06/30/95 07/15/95 0.0000 0.0000 0.00 25,333,506
07/31/95 18.91 07/31/95 08/15/95 0.0000 0.0000 0.00 n/a
08/31/95 19.10 08/31/95 09/15/95 0.0000 0.0000 0.00 27,133,862
09/30/95 19.61 09/30/95 10/15/95 0.0000 0.0000 0.00 27,928,392
10/31/95 19.12 10/31/95 11/15/95 0.0000 0.0000 0.00 27,342,653
11/30/95 19.77 11/30/95 12/15/95 0.0000 0.0000 0.00 28,531,436
12/31/95 18.58 12/31/95 12/31/95 0.2040 1.2319 18.58 27,089,752
<S> <C> <C> <C>
01/31/95 0.000000 0.000000 142.069487
02/28/95 0.000000 0.000000 142.069487
03/31/95 0.000000 0.000000 142.069487
04/30/95 0.000000 0.000000 142.069487
05/31/95 0.000000 0.000000 142.069487
06/30/95 0.000000 0.000000 142.069487
07/31/95 0.000000 0.000000 142.069487
08/31/95 0.000000 0.000000 142.069487
09/30/95 0.000000 0.000000 142.069487
10/31/95 0.000000 0.000000 142.069487
11/30/95 0.000000 0.000000 142.069487
12/31/95 203.997576 10.979417 153.048904
</TABLE>
<PAGE>
NET CIF: CAPITAL APPRECIATION
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
<TABLE>
<CAPTION>
PURCHASE DATE: 09/01/95
INITIAL INVESTME $1,000.00
INITIAL VALUE: 10.53 (5% SALES LOAD)
SHARES PURCHASED 94.967
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
09/01/95 10.00 09/01/95 09/01/95
09/30/95 10.12 09/30/95 09/30/95
10/31/95 10.03 10/31/95 11/15/95
11/30/95 10.36 11/30/95 12/15/95
12/31/95 10.40 12/31/95 12/31/95 0.0374
<CAPTION>
SHARES TO DAX (NAV +NOT REINVESTE GROSS VALUE
95.513734 10.40 993.3428
GROSS VALUE - INITIAL INVESTMENT NET VALUE
993.3428 1,000.00 (-6.6572)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(-6.6572) 1,000.00 -0.0067
NET RATE OF RETURN SINCE INCEPTION: -0.67%
ANNUALIZED NET RATE OF RETURN SINCE INCE -1.99%
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
09/01/95 10.00 94.96676163
09/30/95 10.12 1,170,631 94.96676163
10/31/95 1,299,214 94.96676163
11/30/95 1,433,440 94.96676163
12/31/95 0.0225 10.40 1,587,109 5.688509022 0.546972021 95.51373365
95.51373365
95.51373365
95.51373365
95.51373365
95.51373365
95.51373365
95.51373365
95.51373365
</TABLE>
<PAGE>
GROSS CIF: CAPITAL APPRECIATION
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 09/01/95
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 10.00
SHARES PURCHASED: 100.000
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
09/01/95 10.00 09/01/95 09/01/95
09/30/95 10.12 09/30/95 09/30/95
10/31/95 10.03 10/31/95 11/15/95 0.0000
11/30/95 10.36 11/30/95 12/15/95 0.0000
12/31/95 10.40 12/31/95 12/31/95 0.0374
SHARES TO DATE X (NAV + NOT REINVESTED)= GROSS VALUE
100.575962 10.40 0 1045.9900
GROSS VALUE - INITIAL INVESTMENT =NET VALUE
1045.9900 1,000.00 (45.9900)
NET VALUE / INITIAL INVESTMENT =GROSS RATE OF RETURN
(45.9900) 1,000.00 0.0460
GROSS RATE OF RETURN SINCE INCEPTION: 4.60%
ANNUALIZED GROSS RATE OF RETURN SINCE INCEPTION: 14.53%
<CAPTION>
CAPITAL SHARES TOTALS
DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
09/01/95 10.00 0.000000 0.000000 1
09/30/95 10.12 1,170,631 0.000000 0.000000 1
10/31/95 0.0000 0.00 1,299,214 0.000000 0.000000 1
11/30/95 0.0000 0.00 1,433,440 0.000000 0.000000 1
12/31/95 0.0225 10.40 1,587,109 5.990000 0.575962 1
</TABLE>
<PAGE>
NET CIF: GLOBAL INCOME
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 09/01/95
INITIAL INVESTME $1,000.00
INITIAL VALUE: 10.31 (3% SALES LOAD)
SHARES PURCHASED 96.993
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
09/01/95 10.00 09/01/95 09/01/95
09/30/95 9.93 09/30/95 10/15/95 0.0031
10/31/95 10.01 10/31/95 11/15/95 0.0378
11/30/95 10.09 11/30/95 12/15/95 0.0358
12/31/95 10.21 12/31/95 12/31/95 0.0389
SHARES TO DAX (NAV +NOT REINVESTE GROSS VALUE
98.100312 10.21 1001.6042
GROSS VALUE - INITIAL INVESTMENT NET VALUE
1001.6042 1,000.00 (1.6042)
NET VALUE / INITIAL INVESTMENT NET RATE OF RETURN
(1.6042) 1,000.00 0.0016
NET RATE OF RETURN SINCE INCEPTION: 0.16%
ANNUALIZED NET RATE OF RETURN SINCE INCE 0.48%
<CAPTION>
SHARES TOTALS
DATE CAPITAL REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> DISTRIBUTIONS <C> <C> <C> <C> <C>
09/01/95 <C> 10.00 96.99321048
09/30/95 9.95 1,170,631 0.300678952 0.030218990 97.02342947
10/31/95 10.12 1,299,214 3.667485634 0.362399766 97.38582923
11/30/95 10.19 10,486,104 3.486412686 0.342140597 97.72796983
12/31/95 10.21 10,585,690 3.801618026 0.372342608 98.10031244
</TABLE>
<PAGE>
GROSS CIF: GLOBAL INCOME
RATE OF RETURN
SINCE PREPARED ON: 12/31/95
INCEPTION
...............
PURCHASE DATE: 09/01/95
INITIAL INVESTMENT: $1,000.00
INITIAL VALUE: 10.00
SHARES PURCHASED: 100.000
<TABLE>
<CAPTION>
INCOME
DATE NAV EX-DATE PAYABLE DATE DISTRIBUTION
<S> <C> <C> <C> <C>
09/01/95 10.00 09/01/95 09/01/95
09/30/95 9.93 09/30/95 10/15/95 0.0031
10/31/95 10.01 10/31/95 11/15/95 0.0378
11/30/95 10.09 11/30/95 12/15/95 0.0358
12/31/95 10.21 12/31/95 12/31/95 0.0389
SHARES TO DATE X (NAV + NOT REINVESTED)= GROSS VALUE
101.141422 10.21 0 1032.6539
GROSS VALUE - INITIAL INVESTMENT =NET VALUE
1032.6539 1,000.00 (32.6539)
NET VALUE / INITIAL INVESTMENT =GROSS RATE OF RETURN
(32.6539) 1,000.00 0.0327
GROSS RATE OF RETURN SINCE INCEPTION: 3.27%
ANNUALIZED GROSS RATE OF RETURN SINCE INCEPTION: 10.18%
<CAPTION>
CAPITAL SHARES TOTALS
DATE DISTRIBUTIONS REINVEST NAV NET ASSETS $ TO DIST. REINV. SHARES
<S> <C> <C> <C> <C> <C> <C>
09/01/95 10.00 0.000000 0.000000 100.00000
09/30/95 9.95 1,170,631 0.310000 0.031156 100.03115
10/31/95 0.0000 10.12 1,299,214 3.781178 0.373634 100.40479
11/30/95 0.0000 10.19 10,486,104 3.594491 0.352747 100.75753
12/31/95 0.0000 10.21 10,585,690 3.919468 0.383885 101.14142
0.000000 0.000000 101.14142
0.000000 0.000000 101.14142
0.000000 0.000000 101.14142
0.000000 0.000000 101.14142
0.000000 0.000000 101.14142
0.000000 0.000000 101.14142
0.000000 0.000000 101.14142
0.000000 0.000000 101.14142
</TABLE>
<PAGE>
EXHIBIT 99.4
DIAGRAM OF SUBSIDIARIES
OF THE CHUBB CORPORATION
<PAGE>
SUBSIDIARIES OF THE CHUBB CORPORATION
-------------------------------------
at September 1, 1995
--------------------
Chubb & Son, Inc.
- Associated Aviation Underwriters (affiliate)
- Chubb Services Corporation
- Chubb & Son Inc. (Illinois)
- Chubb Customer Center, Inc.
The Chubb Corporation, a Delaware corporation
- Bhakdikij Company Limited (affiliate)
- Chubb de Mexico, Compania de Seguros S.A. de S.V. (affiliate)
- Chubb Insurance Company (Thailand), Limited (affiliate)
Personal Lines Insurance Brokerage, Inc.
- Personal Lines Insurance Brokerage II, Inc.
- Personal Lines Insurance Brokerage of Massachusetts, Inc.
- ECCO General Agency, Inc.
- Personal Lines Insurance Brokerage, Inc., a Texas corporation
Chubb Life Insurance Company of America
- Chubb America Service Corporation
- ChubbHealth Holdings, Inc.
- ChubbHealth, Inc.
- Chubb Investment Advisory Corporation
- Chubb Securities Corporation
- Chubb Sovereign Life Insurance Company
- Chubb Colonial Life Insurance Company
- Hampshire Funding, Inc.
- Hampshire Syndications, Inc.
- Volunteer Garage, Inc.
Federal Insurance Company
- Bellemead Development Corporation
- C.C. Canada Holdings Ltd.
- Chubb Insurance Company of Canada
- Chubb de Mexico, Compania Afianzadora, S.A. de S.V.
- Chubb de Mexico, Compania de Seguros, S.A. de S.V. (affiliate)
- Chubb Custom Insurance Company
- Chubb de Mexico Servicios de Suscripcion y Administatives,
S.A. de C.V.
- Chubb Indemnity Insurance Company
- Chubb Insurance Company of Europe, S.A.
- Chubb Insurance Company of New Jersey
- Chubb Lloyd's Insurance Company of Texas (affiliate)
- Chubb National Insurance Company
- Chubb Pacific Underwriting Management Services Pte. Ltd.
- Chubb Seguros-Holdings Chile, S.A.
- Chubb de Chile Compania de Seguros Generales, S.A.
- Great Northern Insurance Company
- Pacific Indemnity Company
<PAGE>
- Northwestern Pacific Indemnity Company
- Texas Pacific Indemnity Company
- Seguros La Federacion, C.A. - Venezuela (affiliate)
- Vigilant Insurance Company
- Chubb de Colombia Compania de Seguros, S.A.
- Chubb Insurance Company of Australia Limited
<PAGE>
EXHIBIT 99.5
PRICE MAKE UP SHEET
<PAGE>
EXHIBIT 99.5
PRICE MAKE UP SHEET
CHUBB INVESTMENT FUNDS, INC.
Calculation of Offering Prices
December 31, 1995
<TABLE>
<CAPTION>
Net Asset Offering
Total Shares Value Price
Fund Net Assets Outstanding Per Share Per Share
-------------- ------------ ------------- ----------- -----------
<S> <C> <C> <C> <C>
Money Market $7,620,208 7,620,969 $1.00 $1.00
Government Securities 13,886,478 1,287,696 10.78 11.11
Total Return 22,171,326 1,388,932 15.96 16.80
Tax-Exempt 15,259,349 1,237,682 12.33 12.71
Growth & Income 29,144,161 1,568,900 18.58 19.56
Capital Appreciation 1,596,254 153,462 10.40 10.95
Global Income 10,705,562 1,048,603 10.21 10.53
</TABLE>
