FAMILY OF FUNDS
Money Market Fund
Institutional Money Market Fund
U.S. Government Money Market Fund
U.S. Treasury Money Market Fund
Tax-Exempt Money Market Fund
Short-Term Bond Market Fund
Intermediate Bond Market Fund
Tax-Exempt Intermediate Bond Fund
Bond IMMDEX(TM) Fund
Balanced Income Fund
Balanced Growth Fund
Growth and Income Fund
Equity Index Fund
Growth Fund
MidCap Index Fund
Special Growth Fund
Emerging Growth Fund
MicroCap Fund
Core International Equity Fund
International Equity Fund
SEMI-ANNUAL REPORT
APRIL 30, 2000
FIRSTARFUNDS
<PAGE>
NOTICE TO INVESTORS
o Shares of Firstar Funds:
o ARE NOT INSURED BY THE FDIC, the US Government or any other
governmental agency;
o are not bank deposits or obligations of or guaranteed by Firstar Bank,
its parent company or its affiliates;
o are subject to investment risks, including possible loss of principal;
and
o are distributed by B.C. Ziegler and Company, member NASD, SIPC, and an
independent third-party distributor.
o There can be no assurance that the money market funds will be able to
maintain a stable net asset value of $1.00 per share.
o Firstar Bank affiliates serve as investment adviser, custodian, transfer
agent, administrator, and accounting services agent and receive
compensation for such services as disclosed in the current prospectus.
TABLE OF CONTENTS
Page(s)
Shareholder Letter........................1-3
EQUITY FUNDS
Firstar Balanced Income...................4-5
Firstar Balanced Growth...................6-7
Firstar Growth & Income...................8-9
Firstar Equity Index....................10-11
Firstar Growth..........................12-13
Firstar MidCap Index....................14-15
Firstar Special Growth..................16-17
Firstar Emerging Growth.................18-19
Firstar MicroCap........................20-21
Firstar Core International Equity.......22-23
Firstar International Equity............24-25
Statement of Assets and Liabilities.....26-27
Statement of Changes in Net Assets......28-31
Statement of Operations.................32-33
Financial Highlights....................34-43
Schedule of Investments.................44-88
Page(s)
BOND FUNDS
Firstar Short-Term Bond Market..........90-91
Firstar Intermediate Bond Market........92-93
Firstar Tax-Exempt Intermediate.........94-95
Firstar Bond IMMDEX(TM).................96-97
Statement of Assets and Liabilities........98
Statement of Changes in Net Assets.........99
Statement of Operations...................100
Financial Highlights..................102-107
Schedule of Investments...............108-118
MONEY MARKET FUNDS
Shareholder Letter........................120
Yield Comparisons.........................121
Statement of Assets and Liabilities.......122
Statement of Operations...................123
Statement of Changes in Net Assets....124-125
Financial Highlights..................126-127
Schedule of Investments...............128-135
NOTES TO THE FINANCIAL STATEMENTS.....136-147
<PAGE>
Dear shareholder: June 2000
MID-YEAR REVIEW
With the Y2K "bug" vanquished, it was back to "business as usual" for investors
- that is, unexpectedly strong economic growth and unbelievably volatile
financial markets. The U.S. economy continues to confound the pundits, combining
robust growth and low unemployment with modest inflation.However, the jump in
energy prices and a tight labor market have fostered a more aggressive Federal
Reserve interest rate policy. Clearly, the Fed views the current pace of
economic growth as "too fast," creating imbalances likely to accelerate
inflation if left unchecked. Some observers believe the Fed is behind the curve
and that the inflation "genie" is already "out of the bottle." Others contend
the Fed is wrongly applying "old" economy metrics to a fundamentally different
"new" economy.
In our opinion, the foundation of our current economic success - robust economic
growth with low inflation - rests on the twin pillars of global competition and
improved productivity. U.S. productivity growth averaged 3.7% over the past
twelve months and has averaged 2.3% per year since the end of the last
recession. Although Fed Chairman Alan Greenspan publicly questions the
sustainability of today's productivity gains, the recent upsurge is far from
unprecedented. The Golden Age of U.S. productivity growth, from 1950 to 1973,
saw labor productivity grow at a 2.7% compound annual rate. Improved
productivity means higher profits. Higher profits lead to more spending on
productivity-enhancing technology. Further productivity gains lead to further
profit improvements and the process repeats. Although final demand is surging,
supply-side investment is growing even faster. Finally, Congressional approval
of permanent normal trade relations with China is a reminder that global
competition will only intensify.
1
<PAGE>
ECONOMIC & MARKET OUTLOOK
Looking ahead, our investment strategy is predicated on the following trends:
o Adjusted for inflation, U.S. final sales rose at a +6.9% annual rate in the
first quarter of this year, representing the fastest growth rate of the
current economic cycle.
o Consumer confidence remains near record levels reflecting strong income
gains, low unemployment and the wealth effect from rising asset values.
o Despite higher interest rates, cheap credit is still available to drive
consumer spending.
o Like a tax increase, higher energy prices erode income gains.
o Although much is made of the wealth effect from higher stock prices, the
increase in home values has been the biggest wealth creator for the
majority of Americans.
o Higher mortgage rates are beginning to slow the housing market with
decelerating price gains not far behind.
o We believe the forty percent drop in the NASDAQ and ongoing stock market
volatility will dampen consumer exuberance.
o Fed tightening is raising the dollar's exchange rate, making imports
cheaper (holding down U.S. inflation) and exports less competitive (slowing
the U.S. economy).
o We believe signs of an economic slowdown are likely to emerge by the fall,
allowing the Fed to shift to a neutral policy and bond prices to rally
(what is good for bonds is even better for stocks).
o In the absence of the Treasury buy back, we believe long-term government
bond yields would be higher and credit spreads (the difference in yield
between a corporate bond and a government bond of equal maturity) narrower.
o Today's high inflation-adjusted bond yields are attractive and we believe
the widening in credit spreads creates opportunities to enhance bond
portfolio returns.
o Corporate profits are better-than-expected, reflecting ongoing gains from
investments in productivity-enhancing technology and efficiencies from
restructuring.
2
<PAGE>
o A "Jekyll and Hyde" stock market has emerged as "old economy" shares vie
with the leading technology names for investor favor.
o We believe the stock market will broaden out as the year progresses making
portfolio diversification, complemented by security selection that
emphasizes high quality companies with strong balance sheets, good earnings
visibility and dominant industry positions, a winning strategy.
In summary, we expect the Federal Reserve will successfully engineer a "soft
landing" for the U.S. economy, extending this unprecedented period of economic
prosperity. We believe slower growth will prevent inflation from accelerating
further, yet corporate profitability should remain strong thanks to ongoing
productivity gains and efficiencies achieved through restructuring and mergers.
In short, we anticipate the advent of a more favorable environment for financial
assets later in the year. As you peruse the following pages of this report, you
will find a broad range of equity and fixed income products to meet a wide
variety of investment objectives. As always, we encourage you to contact us with
your comments regarding portfolio performance or our investment strategy.
Thank you for your continued confidence in Firstar Funds.
Sincerely yours,
Firstar Investment Research & Management Company, LLC (FIRMCO)
Investment Policy Committee
JOHN BLIXEN
EXECUTIVE VICE PRESIDENT
RICHARD BURLING
SENIOR VICE PRESIDENT,
DIRECTOR OF CREDIT RESEARCH
WALTER DEWEY
SENIOR VICE PRESIDENT
SENIOR PORTFOLIO MANAGER
DONALD KELLER
SENIOR VICE PRESIDENT
SENIOR PORTFOLIO MANAGER
GEORGE SCHUPP
SENIOR VICE PRESIDENT
DIRECTOR OF FIXED INCOME
MARIAN ZENTMYER
COMMITTEE CHAIRPERSON
EXECUTIVE VICE PRESIDENT
CHIEF EQUITY INVESTMENT
OFFICER
3
<PAGE>
BALANCED INCOME FUND
Firstar Balanced Income Fund seeks to provide current income and preserve
capital by investing in a balanced portfolio of equity and fixed-income
securities. Typically, the Fund will invest 50% of its assets in common stocks
of large companies with the balance invested in intermediate-term,
investment-grade bonds and money market securities. As of April 30, 2000, the
portfolio consisted of approximately 52% stocks, 45% bonds and 3% money market
securities.
Although the equity component of the Fund outperformed the S&P 500 Index and the
bond component outperformed the Lehman Brothers Intermediate
Government/Corporate Bond Index, Firstar Balanced Income Fund modestly
underperformed its benchmark, the Lipper Balanced Fund Index. The Fund returned
3.3% (Institutional shares), while the Lipper Balanced Fund Index returned 5.2%.
We attribute the Fund's relative underperformance during the period to its lower
weighting in equity securities than most balanced funds. The typical balanced
fund in Lipper's universe has about 60% in stocks and only 40% in bonds.
Technology stocks continued to provide the most attractive returns within the
S&P 500 Index. While the S&P 500 Index advanced just 7.2% during the period,
technology stocks within the Index were up 39.6%. Within the technology sector,
we emphasized companies benefiting from accelerated unit growth in internet
infrastructure and wireless communications. Specifically, our investments in
Texas Instruments, Nortel Networks and Nokia were positive contributors to the
Fund's performance. Please see the Schedule of Investments section of this
report for a complete listing of the portfolio holdings.
The Fund also achieved good relative results in the financial sector by
emphasizing companies which generate the majority of their income from fee-based
businesses, making them less interest rate sensitive. Our investments in
Northern Trust, Alliance Capital Management and Marsh & McLennan contributed
positively to the Fund's results relative to the S&P 500 Index. All other
sectors contributed only modestly to the Fund's equity performance.
The objective of the fixed-income portion of the portfolio is to provide an
annual rate of total return, prior to Fund expenses, comparable to the return of
the Lehman Brothers Intermediate Government/Corporate Bond Index. During this
reporting period, the Federal Reserve tightened credit three times, raising the
Federal Funds rate from 5.25% to 6.00%. (The Federal Funds rate was increased by
an additional 0.50% on May 16, 2000.) We believe the Fed will be done tightening
by the end of summer, which would allow for a potential rally in bond prices
during the latter part of the fiscal year. The overall credit quality of the
portfolio remained high during the period, with a weighted average rating of AA,
and we continue to match the duration of the fixed-income portion of the
portfolio to that of the Lehman Brothers Intermediate Government/Corporate Bond
Index (4.04 years as of April 30, 2000).
The Firstar Balance Income Fund is designed to appeal to investors who are
looking for a portfolio of more conservative equity and fixed income
investments.
We appreciate your investment in Firstar Balanced Income Fund.
PORTFOLIO MANAGER PROFILE
MARIAN E. ZENTMYER, CFA, CFP, Chief Equity Investment Officer of Firstar
Investment Research & Management, LLC (FIRMCO) and DAVID BETHKE, CFA, co-manage
the Fund - Marian since its inception on January 1, 1989 and David since
February 14, 2000. Marian has been with Firstar since 1982 and has 22 years of
investment managment experience. David has been with Firstar since 1987 and has
20 years of investment management experience. Marian is a Certified Financial
Planner and a Chartered Financial Analyst. David is a Chartered Financial
Analyst.
4
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Balanced Income Fund - Institutional
12/1/97 10,000
10/98 11,270
10/99 11,984
4/00 12,384
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 12/1/97 (INCEPTION).
PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE WAIVERS, TOTAL
RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL SHARES, WHICH
HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE FEES AND EXPENSES
WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE BEEN REDUCED. RETURNS
SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER DISTRIBUTIONS. PAST
PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------
Fiscal
Year-To-Date 1 Year Since Inception
--------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FIRSTAR BALANCED INCOME FUND - INSTITUTIONAL 3.3 2.5 9.3 (12/1/97)
FIRSTAR BALANCED INCOME FUND - A - NO LOAD 3.2 2.2 9.0 (12/1/97)
FIRSTAR BALANCED INCOME FUND - A - LOAD<F1> (2.5) (3.4) 6.4 (12/1/97)
FIRSTAR BALANCED INCOME FUND - B - NO LOAD 2.9 1.6 4.2 (3/1/99)
FIRSTAR BALANCED INCOME FUND - B - LOAD<F2> (2.1) (3.3) 0.8 (3/1/99)
LIPPER BALANCED FUND INDEX<F3> 5.2 5.0 11.0 (12/1/97)
S&P 500 STOCK INDEX<F4> 7.2 10.1 20.6 (12/1/97)
A= Series A (Retail shares)
B= Series B (Retail shares)
</TABLE>
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The Lipper Balanced Fund Index is composed of the 30 largest mutual funds
whose primary objective is to conserve principal by maintaining a balanced
portfolio of stocks and bonds.
<F4> The S&P500 Stock Index is an index of an unmanaged group of 500 selected
common stocks, most of which are listed on the New York Stock Exchange. The
Index is heavily weighted toward stocks with large market capitalizations
and represents approximately two-thirds of the total market value of all
domestic common stocks.
An investment cannot be made directly in an index.
Series A shares have a 5.50% maximum sales load and are subject to an annual
0.25% service organization fee. Series B shares have a 5.00% maximum deferred
sales charge and are subject to an annual 0.25% service organization fee and a
0.75% 12b-1 fee. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 4/30/00
------------------------------------
WARNER-LAMBERT COMPANY 1.4%
------------------------------------
TEXAS INSTRUMENTS, INC. 1.3%
------------------------------------
MILLIPORE CORPORATION 1.1%
------------------------------------
NORTHERN TRUST CORPORATION 1.1%
------------------------------------
CITIGROUP, INC. 1.1%
------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
------------------------------------
$91,992,695
------------------------------------
5
<PAGE>
BALANCED GROWTH FUND
Firstar Balanced Growth Fund seeks a balance of capital appreciation and current
income with a relatively low volatility of capital. The Fund invests in a
diversified portfolio of fixed-income and equity securities. As of April 30,
2000, the weighted average market capitalization of the equity holdings of the
Fund was $63.8 billion. The fixed-income securities within the portfolio had an
average maturity of 10.8 years and an average duration of 5.4 years. The asset
allocation on April 30, 2000 was 65% in stocks, 33% in bonds and 2% in money
market securities. For the first six months of the 2000 fiscal year, the Fund
returned +15.4% (Institutional shares), compared with the Standard & Poor's 500
Stock Index which returned +7.2% and the Lehman Government/Corporate Bond Index
which returned +1.5%. The Lipper Balanced Fund Index returned +5.2% during the
same period.
The stock portion of the Fund was responsible for the outstanding results of the
last six months. The reasons for this strong relative performance can be tied to
the broad capitalization range of the equity holdings in the Fund, and also to
good security selection. Firstar Balanced Growth Fund is invested in over 300
companies. 70% of those equity holdings are large capitalization companies and
the remaining 30% are invested in medium and smaller capitalization companies.
The exposure to small- and medium-sized companies was of great benefit to the
Fund in the last six months as their performance was stronger than that of large
companies. Specifically, the S&P SmallCap 600 Index was up +17.3% and the S&P
MidCap 400 Index returned +18.3%, far ahead of the S&P 500 return of +7.2%. This
is an approach the Fund has taken since inception, which positions the Fund with
a much higher level of small- and medium-sized stocks than many balanced funds.
We would expect the Fund to perform well relative to other balanced funds when
large companies are not the most favored area of the stock market.
Security selection also was important, as the large, medium and small stock
segments of the Fund outperformed the applicable benchmarks referenced above.
Technology was the single largest sector of investment with 38% of the total
equity commitment, and was the best performing area of the market with a +36.5%
return for the first half of the fiscal year. By having the largest
concentration of stocks in the best performing area, the Fund was positioned
favorably. As the stocks owned within the technology sector performed better
than the market sector, this positive effect of technology was even further
magnified. Leading technology holdings in the Fund include Nortel Networks,
First Data, Cisco and Texas Instruments. While technology is a volatile area,
sales and earnings growth for the leading companies are still robust, so we
continue to overweight the area. Other sectors of significance are consumer
cyclical companies (including Wal-Mart, Kohl's and Harley Davidson) which, in
total, were 16% of the Fund, and finance stocks (including American
International Group, State Street, Morgan Stanley Dean Witter) which, in total,
represented 11% of the portfolio. The equity portion of the portfolio has been
increasing the commitment to energy based upon excellent fundamentals in the
industry. Please see the Schedule of Investments section of this report for a
complete list of portfolio holdings.
We believe the remainder of the fiscal year will be dominated by Federal Reserve
policy and the Fed's effort to restrain inflation. The restrictive monetary
policy the Fed has adopted will usually restrict strong advancement in equity
prices, making security selection critical. We believe companies with strong
sales and earnings growth should fare better in a slowing economy than those
unable to adjust to slowing demand. We continue to believe that small- and
medium-sized companies are positioned well for a multi-year period of relative
outperformance, making us comfortable with the Fund's allocation to these
companies. Bond returns have suffered through the rising interest rate
environment of the last twenty months, making them particularly attractive
amidst signs of a slowing economy. Our duration neutral strategy should allow us
to participate in a bond rally, whenever it may materialize from falling
interest rates. While forecasting is fun but generally humbling in the final
analysis, we believe the Balanced Growth Fund's broad diversification among
stocks of all market capitalizations and fixed-income securities provides
investors with exposure to opportunities the markets may deliver.
Thank you for your continued support of Firstar Balanced Growth Fund.
PORTFOLIO MANAGER PROFILE
WALTER DEWEY, CFA, Senior Vice President and Senior Portfolio Manager and GEORGE
SCHUPP, CFA, Director of Fixed Income Services of Firstar Investment Research &
Management, LLC (FIRMCO) co-manage the Fund, Walter since November 8, 1999 and
George since February 14, 2000. Walter has been with FIRMCO and its affiliates
since 1986 and has 16 years of investment management experience. George has 25
years of investment management experience and has been with FIRMCO and its
affiliates since 1983. Walter and George are both Chartered Financial Analysts.
6
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Balanced Growth Fund - Institutional
3/30/92 10,000
10/92 10,372
10/93 11,771
10/94 11,662
10/95 13,969
10/96 15,724
10/97 18,615
10/98 20,260
10/99 21,449
4/00 24,753
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 3/30/92 (INCEPTION).
PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE WAIVERS, TOTAL
RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL SHARES, WHICH
HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE FEES AND EXPENSES
WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE BEEN REDUCED. RETURNS
SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER DISTRIBUTIONS. PAST
PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------
Fiscal
Year-To-Date 1 Year 3 Years 5 Years Since Inception
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FIRSTAR BALANCED GROWTH FUND - INSTITUTIONAL 15.4 14.4 15.1 14.8 11.9 (3/30/92)
FIRSTAR BALANCED GROWTH FUND - A - NO LOAD 15.3 14.1 14.8 14.5 11.7 (3/30/92)
FIRSTAR BALANCED GROWTH FUND - A - LOAD<F1> 9.0 7.9 12.6 13.3 10.9 (3/30/92)
FIRSTAR BALANCED GROWTH FUND - B - NO LOAD 14.9 13.3 -- -- 12.8 (3/1/99)
FIRSTAR BALANCED GROWTH FUND - B - LOAD<F2> 9.9 8.3 -- -- 9.5 (3/1/99)
LIPPER BALANCED FUND INDEX<F3> 5.2 5.0 13.8 14.8 12.3 (3/30/92)
S&P 500 STOCK INDEX<F4> 7.2 10.1 23.7 25.3 19.7 (3/30/92)
-------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The Lipper Balanced Fund Index is composed of the 30 largest mutual funds
whose primary objective is to conserve principal by maintaining a balanced
portfolio of stocks and bonds.
<F4> The S&P500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic common
stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 5.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995,
does not reflect the service organization fees. If service organization fees had
been reflected, performance would be reduced. Series B shares have a 5.00%
maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 EQUITY HOLDINGS 4/30/00
------------------------------------
TEXAS INSTRUMENTS, INC. 1.6%
------------------------------------
CISCO SYSTEMS, INC. 1.5%
------------------------------------
NORTEL NETWORKS CORPORATION 1.3%
------------------------------------
MICROSOFT CORPORATION 1.2%
------------------------------------
WARNER-LAMBERT COMPANY 1.2%
------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
------------------------------------
$229,307,608
------------------------------------
7
<PAGE>
GROWTH AND INCOME FUND
Firstar Growth & Income Fund posted a +6.6% (Institutional shares) total return
during the first six months of the Fund's fiscal year. This compares to a +7.2%
gain for the Standard & Poor's 500 Index and a +2.7% return for the Standard &
Poor's Barra Value Index. Based on the Fund's profile, an appropriate benchmark
is a fifty-fifty blend of these two indexes. During this six-month period,
technology stocks continued to rule the day with the S&P technology sector up
+39.6%. All other sectors contributed modestly to results with five sectors
(basic materials, communication services, consumer staples, financials and
transportation) showing negative returns. Although the Growth & Income Fund's
15% technology weighting was significantly below the S&P 500's 32% tech
weighting, strong stock selection allowed the Fund to out-perform the Index in
technology.
Within the technology sector, we emphasized companies benefiting from
accelerating unit growth in internet infrastructure and wireless communications.
Specific holdings that contributed to the Fund's strong relative performance
were Texas Instruments, the largest global producer of Digital Signal Processors
(DSPs are chips found in virtually every cellular phone produced); Nortel
Networks, the leading provider of fiber optic technology for the
telecommunications industry; and Nokia, the largest global producer of cellular
phones.
Although stocks in the financial sector were generally poor performers (the
Standard & Poor's financial sector was down 7%), the Growth & Income Fund
generated above-benchmark performance by emphasizing financial companies which
generate the majority of their income from fee based businesses. The Fund had
excellent results from Northern Trust, Alliance Capital Management and Marsh &
McLennan.
Strength in the Fund's holdings in the capital goods sector was paced by
Millipore, a manufacturer of products used to analyze and purify liquids and
gases. In the microelectronics segment, Millipore has been a beneficiary of a
strong semi conductor capital equipment cycle while the company's
biopharmaceutical segment should benefit from increased research and development
activity in genomics and monoclonal antibodies.
With short-term interest rates approaching 7%, stock prices are likely to be
volatile over the summer months. However, volatility often creates opportunities
to buy top quality companies with proven management teams at attractive prices.
As always, the Growth & Income Fund's focus is high quality companies with
predictable sales, earnings and cash flow growth, strong balance sheets and
innovative management. Ongoing market volatility should force investors to seek
companies with strong underlying fundamentals rather than chase the hottest new
internet story. We believe an investor rotation back to quality stocks should
equate to even better relative performance for the Growth & Income Fund.
Thank you for your continued investment in Firstar Balanced Growth Fund.
PORTFOLIO MANAGER PROFILE
MARIAN E. ZENTMYER, CFA, CFP, Executive Vice President and Chief Equity
Investment Officer of Firstar Investment Research & Management Company, LLC
(FIRMCO) and DAVID LETTENBERGER, CFA, Vice President and Portfolio Manager with
FIRMCO co-manage the Fund - Marian since February 22, 1993 and David since
November 8, 1999. Marian has been with Firstar since 1982 and has 21 years of
investment management experience. She received her BA from Stanford University
in 1978. David has been with Firstar since 1999 and has six years of investment
management experience. He holds a BS from Marquette University.
8
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Growth and Income Fund - Institutional
12/29/89 10,000
10/90 9,304
10/91 11,688
10/92 12,368
10/93 13,596
10/94 13,846
10/95 17,307
10/96 21,963
10/97 28,734
10/98 34,008
10/99 38,129
4/00 40,628
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 12/29/89
(INCEPTION). PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE
WAIVERS, TOTAL RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL
SHARES, WHICH HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE
FEES AND EXPENSES WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE
BEEN REDUCED. RETURNS SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER
DISTRIBUTIONS. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------
Fiscal
Year-To-Date 1 Year 5 Years 10 Years Since Inception
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FIRSTAR GROWTH AND INCOME FUND - INSTITUTIONAL 6.6 4.7 21.5 15.6 14.5 (12/29/89)
FIRSTAR GROWTH AND INCOME FUND - A - NO LOAD 6.4 4.5 21.2 15.5 14.4 (12/29/89)
FIRSTAR GROWTH AND INCOME FUND - A - LOAD<F1> 0.6 (1.3) 19.9 14.8 13.7 (12/29/89)
FIRSTAR GROWTH AND INCOME FUND - B - NO LOAD 6.0 3.7 -- -- 8.0 (3/1/99)
FIRSTAR GROWTH AND INCOME FUND - B - LOAD<F2> 1.0 (1.4) -- -- 4.7 (3/1/99)
S&P 500 STOCK INDEX<F3> 7.2 10.1 23.7 18.8 17.5 (12/29/89)
S&P 500/BARRA VALUE INDEX<F4> 2.7 0.5 19.8 16.1 14.8 (12/29/89)
-----------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The S&P500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic common
stocks.
<F4> The S&P500/BARRA Value is an unmanaged index of common stocks consisting of
50% of the S&P 500 market capitalization, whose common stock constituents
have the lowest price-to-book ratios within the S&P 500.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer SeriesA shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 5.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995,
does not reflect the service organization fees. If service organization fees had
been reflected, performance would be reduced. Series B shares have a 5.00%
maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 EQUITY HOLDINGS 4/30/00
----------------------------------------
WARNER-LAMBERT COMPANY 2.5%
----------------------------------------
TEXAS INSTRUMENTS, INC. 2.4%
----------------------------------------
ALLIANCE CAPITAL MANAGEMENT L.P. 2.2%
----------------------------------------
MILLIPORE CORPORATION 2.1%
----------------------------------------
NORTHERN TRUST CORPORATION 2.0%
----------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
----------------------------------------
$693,452,073
----------------------------------------
9
<PAGE>
EQUITY INDEX FUND
Firstar Equity Index Fund seeks to provide investment returns, before Fund
expenses, comparable to the price and yield performance of publicly traded
stocks in the aggregate, as represented by the S&P 500 Index. The Fund does not
use traditional methods of financial and market analysis when making purchase
and sale decisions; rather, the Fund invests primarily in common stocks that
comprise the S&P 500 Index in proportion to their relative capitalization and
sector weightings.
Firstar Equity Index Fund's net asset value of $95.63 (Institutional shares) on
April 30, 2000 represents a total return of 6.8% for the first six months of the
fiscal year, compared to the S&P's return of 7.2% over the same period.
We believe by applying a capitalization weighting and sector balancing technique
that matches the structure of the S&P 500, as well as using S&P 500 futures
contracts to equitize the cash, the Fund should reasonably track the performance
of the index.
Thank you for investing in Firstar Equity Index Fund.
PORTFOLIO MANAGER PROFILE
CARL J. SMITH, Assistant Vice President and Portfolio Manager of Firstar
Investment Research & Management Company, LLC (FIRMCO) has managed the Fund
since January, 1996. Carl has been with Firstar since 1982 and has eight years
of investment management experience. He received his BS in 1994 from Cardinal
Stritch College.
10
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Equity Index Fund - Institutional
12/29/89 10,000
10/90 8,854
10/91 11,767
10/92 12,869
10/93 14,644
10/94 15,157
10/95 19,101
10/96 23,624
10/97 31,037
10/98 37,843
10/99 47,424
4/00 50,645
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON
12/29/89 (INCEPTION). PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE
OF FEE WAIVERS, TOTAL RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR
INSTITUTIONAL SHARES, WHICH HAVE LOWER EXPENSES THAN SERIES A OR SERIES B
SHARES. IF THOSE FEES AND EXPENSES WERE REFLECTED IN THE CHART ABOVE, TOTAL
RETURN WOULD HAVE BEEN REDUCED. RETURNS SHOWN INCLUDE THE REINVESTMENT OF ALL
DIVIDENDS AND OTHER DISTRIBUTIONS. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE
PERFORMANCE. INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR
SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL
COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
Fiscal
Year-To-Date 1 Year 5 Years 10 Years Since Inception
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FIRSTAR EQUITY INDEX FUND - INSTITUTIONAL 6.8 9.6 24.8 18.3 17.0 (12/29/89)
FIRSTAR EQUITY INDEX FUND - A - NO LOAD 6.6 9.3 24.5 18.1 16.8 (12/29/89)
FIRSTAR EQUITY INDEX FUND - A - LOAD<F1> 0.8 3.3 23.1 17.5 16.2 (12/29/89)
FIRSTAR EQUITY INDEX FUND - B - NO LOAD 6.3 8.4 -- -- 14.2 (3/1/99)
FIRSTAR EQUITY INDEX FUND - B - LOAD<F2> 1.3 3.4 -- -- 10.8 (3/1/99)
S&P 500 STOCK INDEX<F3> 7.2 10.1 25.3 18.8 17.5 (12/29/89)
---------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The S&P 500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic common
stocks.
"Standard & Poor's(R)," "S&P(R)," "S&P 500(R)," "Standard & Poor's 500," and
"500" are trademarks of the McGraw Hill Companies, Inc. and have been licensed
for use by Firstar Funds. The Equity Index Fund is not sponsored, endorsed, sold
or promoted by Standard & Poor's and Standard & Poor's makes no representation
regarding the advisability of investing in the Equity Index Fund. An investment
cannot be made directly in an index. Effective at the close of business on
January 9, 1995, Firstar Funds began to offer Series A shares. Effective at the
close of business on February 28, 1999, Firstar Funds began to offer Series B
shares. Series A shares have a 5.50% maximum sales load and are subject to an
annual 0.25% service organization fee. The performance for the Series A shares
has been restated to reflect the impact of the current sales charge. Series A
performance prior to January 10, 1995, does not reflect the service organization
fees. If service organization fees had been reflected, performance would be
reduced. Series B shares have a 5.00% maximum deferred sales charge and are
subject to an annual 0.25% service organization fee and an annual 0.75% 12b-1
fee. Performance for all share classes reflects fee waivers in effect. In the
absence of fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 4/30/00
------------------------------------
GENERAL ELECTRIC COMPANY 4.0%
------------------------------------
CISCO SYSTEMS, INC. 3.7%
------------------------------------
INTEL CORPORATION 3.3%
------------------------------------
MICROSOFT CORPORATION 2.9%
------------------------------------
EXXON MOBIL CORPORATION 2.1%
------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
------------------------------------
$821,647,376
------------------------------------
11
<PAGE>
GROWTH FUND
Firstar Growth Fund seeks long-term capital appreciation by investing in the
securities of large-sized companies. As of April 30, 2000, the portfolio had a
weighted average market capitalization of $86.0 billion, which compares with the
Fund's primary benchmark, the Standard & Poor's 500 (S&P 500) which had a
weighted average market capitalization of $139.3 billion. During the six months
ending April 30, 2000, the Growth Fund returned +19.0% (Institutional shares),
ahead of the S&P 500 return of +7.2%. The Fund's return also compares favorably
with the Lipper Large-Cap Core Fund Index of +10.2%.
The first six months of the fiscal year have witnessed new levels of extreme
market volatility. It has become commonplace for stock prices to move up or down
by 1% in a single day. This daily volatility is also evident in the performance
of the major indices, particularly the NASDAQ composite. During the six months
ending April 30, 2000, the price performance of the NASDAQ was 30.1%. Sandwiched
into the six months was a +70% move from October 31, 1999 to March 10, 2000,
followed by a -37% plunge from March 10 to April 24. During these same time
periods, the S&P 500 was up +2.4% and +2.5%, respectively. This divergence is
extraordinary, and is a direct result of the technology stock "mania" that has
captured public attention. The NASDAQ is dominated by technology stocks, so the
moves of this single sector are now driving stock prices to a degree last seen
twenty years ago when oil related firms had a similar effect.
As we discussed in our last year-end report, the Fund had made several new
technology purchases last spring and summer. Our belief was that owning those
companies who were dominating large and growing markets were best positioned for
the dynamics of the sector. This assessment proved correct during the period as
over-weighted positions in Nokia (a producer of cell phones), Nortel (a telecom
equipment firm), Texas Instruments (a digital signal processors manufacturer)
and Sun Microsystems (internet servers) led outstanding performance in
technology. Small investments in PMC Sierra, Network Appliance, Broadcom and JDS
Uniphase were also significant positive contributors to the Fund's performance.
An under-weighted position in Microsoft helped our return relative to the S&P
500, but was also the biggest detraction from the Fund's absolute return.
(Please see the Schedule of Investments section of this report for a complete
listing of portfolio holdings). Our insistence on profitable companies for
portfolio inclusion also "cushioned" the decline these stocks experienced in
March and April. The strong relative results for the Fund are a direct result of
our improved execution in technology investing.
The technology mania mentioned above has had a distorting impact on many growth
funds. The outstanding results of the sector led many managers to let the
allocation to the sector creep to a much higher level than normal. This strategy
has led to magnified gains and losses in some portfolios. While we are pleased
with our improvement in technology, we note that the allocation to the sector
was never higher than 42% of the portfolio. This allocation was just 5% more
than the S&P 500 weight. Diversification among other growth sectors (healthcare,
finance and consumer cyclicals) was important in reducing the volatility of our
technology commitment.
We believe the remainder of the 2000 fiscal year will be dominated by Federal
Reserve monetary policy and the U.S. election cycle. Vice President Gore has
made it clear that drug prices will be a central issue in his campaign, making
the major pharmaceutical stocks subject to investor worries about future
earnings growth. We find valuations reasonable for these stocks currently, but
political issues are likely to limit appreciation potential. Technology stocks
continue to grow much faster than other market sectors, and their price
volatility yields multiple trading opportunities. We continue to over-weight the
sector. The Fed seems convinced inflation is a problem, making future interest
rate increases and their associated pressure on price/earnings ratios a constant
deterrent to stock market performance. Portfolio holdings within Firstar Growth
Fund are concentrated in companies experiencing strong sales and earnings growth
relative to their peers. In this environment, we believe these companies offer
the best opportunity for share price gains.
We appreciate your continued support of Firstar Growth Fund.
PORTFOLIO MANAGER PROFILE
WALTER DEWEY, CFA, Senior Vice President and Senior Portfolio Manager has
managed the Fund since July 7, 1997. Walter has been with FIRMCO and its
affiliates since 1986 and has 16 years of investment management experience. He
is a Chartered Financial Analyst.
12
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Growth Fund - Institutional
12/29/92 10,000
10/93 10,753
10/94 10,813
10/95 12,927
10/96 15,360
10/97 18,671
10/98 22,199
10/99 26,236
4/00 31,224
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 12/29/92
(INCEPTION). PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE
WAIVERS, TOTAL RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL
SHARES, WHICH HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE
FEES AND EXPENSES WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE
BEEN REDUCED. RETURNS SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER
DISTRIBUTIONS. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------
Fiscal
Year-To-Date 1 Year 3 Years 5 Years Since Inception
--------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FIRSTAR GROWTH FUND - INSTITUTIONAL 19.0 21.2 24.7 22.1 16.8 (12/29/92)
FIRSTAR GROWTH FUND - A - NO LOAD 18.8 20.9 24.4 21.8 16.6 (12/29/92)
FIRSTAR GROWTH FUND - A - LOAD<F1> 12.3 14.2 22.1 20.5 15.7 (12/29/92)
FIRSTAR GROWTH FUND - B - NO LOAD 18.4 20.0 -- -- 17.8 (3/1/99)
FIRSTAR GROWTH FUND - B - LOAD<F2> 13.4 15.0 -- -- 14.5 (3/1/99)
S&P 500 STOCK INDEX<F3> 7.2 10.1 23.7 25.3 20.3 (12/29/92)
--------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%
<F3> The S&P500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic common
stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 5.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995,
does not reflect the service organization fees. If service organization fees had
been reflected, performance would be reduced. Series B shares have a 5.00%
maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 EQUITY HOLDINGS 4/30/00
------------------------------------
CISCO SYSTEMS, INC. 3.1%
------------------------------------
TEXAS INSTRUMENTS, INC. 3.1%
------------------------------------
WARNER-LAMBERT COMPANY 2.7%
------------------------------------
NORTEL NETWORKS CORPORATION 2.5%
------------------------------------
MICROSOFT CORPORATION 2.3%
------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
------------------------------------
$374,740,718
------------------------------------
13
<PAGE>
MIDCAP INDEX FUND
Firstar MidCap Index Fund seeks to provide investment returns, before Fund
expenses, comparable to the price and yield performance of publicly traded
stocks in the aggregate, as represented by the S&P MidCap 400 Index. The Fund
does not use traditional methods of financial and market analysis when making
purchase and sale decisions; rather, the Fund invests primarily in common stocks
that comprise the S&P MidCap 400 Index in proportion to their relative
capitalization and sector weightings.
Firstar MidCap Equity Index Fund's net asset value was $10.00 on November 4,
1999, the inception date for the Fund, which represents a total return of 17.0%
(Institutional shares) through April 30, 2000, compared to the S&P MidCap 400's
return of 18.3% for the same period.
We believe by applying a capitalization weighting and sector balancing technique
that matches the structure of the S&P MidCap 400, as well as using S&P 400
futures contracts to equitize the cash, the Fund should reasonably track the
performance of the index.
Thank you for investing in Firstar MidCap Index Fund.
PORTFOLIO MANAGER PROFILE
CARL J. SMITH, Assistant Vice President and Portfolio Manager of Firstar
Investment Research & Management Company, LLC (FIRMCO) has managed Firstar
MidCap Index Fund since its inception on November 4, 1999. Carl has been with
Firstar since 1982 and has eight years of investment management experience. He
received his BS in 1994 from Cardinal Stritch College.
14
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
MidCap Index Fund - Institutional
11/4/99 10,000
4/00 11,697
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 11/4/99 (INCEPTION).
PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE WAIVERS, TOTAL
RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL SHARES, WHICH
HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE FEES AND EXPENSES
WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE BEEN REDUCED. RETURNS
SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER DISTRIBUTIONS. PAST
PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
-------------------------------------------------------------
Since Inception<F4>
-------------------------------------------------------------
FIRSTAR MIDCAP INDEX FUND - INSTITUTIONAL 17.0 (11/4/99)
FIRSTAR MIDCAP INDEX FUND - A - NO LOAD 16.9 (11/4/99)
FIRSTAR MIDCAP INDEX FUND - A - LOAD<F1> 10.5 (11/4/99)
FIRSTAR MIDCAP INDEX FUND - B - NO LOAD 16.6 (11/4/99)
FIRSTAR MIDCAP INDEX FUND - B - LOAD<F2> 11.6 (11/4/99)
S&P MIDCAP 400 INDEX<F3> 18.3 (11/4/99)
-------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The S&P MidCap 400 Index is a capital-weighted index, representing the
aggregate market value of the common equity of 400 stocks chosen by
Standard & Poor's with a median capitalization of approximately $700
million.
"Standard & Poor's(R)," "S&P(R)," "S&P 400(R)" are trademarks of the McGraw Hill
Companies, Inc. and have not been licensed for use by Firstar Funds. The MidCap
Index Fund is not sponsored, endorsed, sold or promoted by Standard & Poor's and
Standard & Poor's makes no representation regarding the advisability of
investing in the MidCap Index Fund.
<F4> Not annualized.
An investment cannot be made directly in an index.
Series A shares have a 5.50% maximum sales load and are subject to an annual
0.25% service organization fee. Series B shares have a 5.00% maximum deferred
sales charge and are subject to an annual 0.25% service organization fee and a
0.75% 12b-1 fee. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 4/30/00
------------------------------------
SIEBEL SYSTEMS, INC. 2.3%
------------------------------------
MAXIM INTEGRATED PRODUCTS 1.8%
------------------------------------
ATMEL CORPORATION 1.1%
------------------------------------
UNIVISION COMMUNICATORS, INC. 1.1%
------------------------------------
ALTERA CORPORATION 1.0%
------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
------------------------------------
$104,501,360
------------------------------------
15
<PAGE>
SPECIAL GROWTH FUND
The first half of the fiscal year accentuated the volatility that comes along
with investing in technology stocks. In fact, the NASDAQ Composite Index rose
37.2% from November 1, 1999 through December 31, 1999, largely driven by high
multiple technology stocks. The following four months, January 1, 2000 through
April 30, 2000, saw the NASDAQ Composite falling -5.1%. (NASDAQ posted a -13.4%
return in April and has continued its downturn through most of May). The recent
technology fall-off and general market selling appears to be largely
attributable to heightened fears of interest rate hikes and a valuation
correction after a momentum-driven calendar year 1999.
We are pleased to report that during this volatile period in the market, Firstar
Special Growth Fund outperformed its benchmark, the S&P MidCap 400 Index, by
over 9%. The Fund's return during the reporting period was 30.6% (Institutional
shares) versus 21.3% for the benchmark.
The Fund's outperformance during the reporting period stemmed from several
sources. First, the Fund's diversification moves during fiscal 1999 provided
some protection in times of market valuation corrections as many investors
shifted assets into traditionally defensive industries such as utilities and
health care. This shift benefited the Fund's relative performance. We also
continued our effort to further diversify the portfolio which led to an increase
in the number of holdings. This practice can provide some risk protection and
improves trading liquidity.
The second source of relative outperformance came from the Fund's disciplined
valuation criteria which kept the Fund out of many high-multiple disasters that
occurred in March and April.
Finally, individual stock selection also contributed to the performance of the
Fund. For the reporting period, the Fund was overweighted in technology (ranging
from 7% to 10% over the weighting of the S&P MidCap 400 Index) and outperformed
the benchmark in technology. We attribute the Fund's outperformance to the work
of our lead technology analyst, Jane Snorek, and to a renewed internal
commitment to understand the rapidly changing technology fields.
As the market rewarded earnings upside in the first part of the fiscal year, we
overweighted the technology and telecommunications sectors relative to the
benchmark as we believed they represented the greatest opportunities for
fundamental growth above expectations. Companies purchased include: General
Dynamics, an aerospace firm; Alza, a pharmaceuticals firm; Polycom, a
telecommunications equipment manufacturer; and Rational Software, a software
development firm. Please see the Schedule of Investments section of this report
for a complete list of portfolio holdings.
Many technology and telecommunications securities became overvalued in our
judgement, and we selectively cut back investments in the highest
price-to-earnings multiple securities. Examples of companies sold include:
Biomet in medical devices, Linear Technology in semiconductors and FR Micro
Devices in wireless equipment. After the 30%-plus drop in the NASDAQ Composite
Index from its high in March, we have begun to slowly add to our technology
weighting.
While absolute returns may be muted by the Federal Reserve Board's tightening
actions, we are optimistic about how Firstar Special Growth Fund is positioned.
The portfolio's expected earnings growth is nearly double that of the S&P MidCap
400 Index while the price-to-earnings ratio is only moderately higher.
As always, we appreciate your investment in Firstar Special Growth Fund.
PORTFOLIO MANAGER PROFILE
TODD KRIEG, CFA, JD, Senior Vice President and Senior Portfolio Manager of
Firstar Investment Research & Management Company, LLC (FIRMCO) and MATTHEW
D'ATTILIO, CFA, Senior Vice President and Senior Portfolio Manager co-manage the
Fund -- Todd since September 1, 1994 and Matt since December 1, 1998. Todd has
been with Firstar since 1992 and has eight years of investment management
experience. He received his BA from Williams College in 1983 and a JD from
Georgetown University in 1989. Matt has been with Firstar since 1993 and has
seven years of investment management experience. He received his BA from Bowdoin
College in 1993. Todd and Matt are both Chartered Financial Analysts.
16
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Special Growth Fund - Institutional
12/28/89 10,000
10/90 8,953
10/91 14,346
10/92 15,617
10/93 18,138
10/94 18,641
10/95 23,449
10/96 26,399
10/97 32,323
10/98 30,494
10/99 30,969
4/00 40,456
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 12/28/89
(INCEPTION). PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE
WAIVERS, TOTAL RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL
SHARES, WHICH HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE
FEES AND EXPENSES WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE
BEEN REDUCED. RETURNS SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER
DISTRIBUTIONS. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------
Fiscal
Year-To-Date 1 Year 5 Years 10 Years Since Inception
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
FIRSTAR SPECIAL GROWTH FUND - INSTITUTIONAL 30.6 23.6 15.2 15.3 14.5 (12/28/89)
FIRSTAR SPECIAL GROWTH FUND - A - NO LOAD 30.5 23.3 15.0 15.2 14.3 (12/28/89)
FIRSTAR SPECIAL GROWTH FUND - A - LOAD<F1> 23.3 16.5 13.7 14.5 13.7 (12/28/89)
FIRSTAR SPECIAL GROWTH FUND - B - NO LOAD 30.0 22.4 -- -- 25.3 (3/1/99)
FIRSTAR SPECIAL GROWTH FUND - B - LOAD<F2> 25.0 17.4 -- -- 22.0 (3/1/99)
S&P MIDCAP 400 INDEX<F3> 21.3 23.5 22.7 19.2 17.7 (12/28/89)
S&P 500 STOCK INDEX<F4> 7.2 10.1 25.3 18.8 17.5 (12/28/89)
------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The S&P MidCap 400 Index is a capital-weighted index, representing the
aggregate market value of the common equity of 400 stocks chosen by
Standard & Poor's with a median capitalization of approximately $700
million.
<F4> The S&P 500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic common
stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 5.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995 does
not reflect the service organization fees. If service organization fees had been
reflected, performance would be reduced. Series B shares have a 5.00% maximum
deferred sales charge and are subject to an annual 0.25% service organization
fee and an annual 0.75% 12b-1 fee. Performance for all share classes reflects
fee waivers in effect. In the absence of fee waivers, total return would be
reduced.
TOP 5 EQUITY HOLDINGS 4/30/00
------------------------------------
FAMILY DOLLAR STORES 2.8%
------------------------------------
CONCORD EFS, INC. 2.5%
------------------------------------
SIEBEL SYSTEMS, INC. 2.5%
------------------------------------
GENERAL DYNAMICS CORPORATION 2.0%
------------------------------------
MAXIM INTEGRATED PRODUCTS 1.9%
------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
------------------------------------
$496,366,286
------------------------------------
17
<PAGE>
EMERGING GROWTH FUND
Market conditions for small company stocks remained favorable during the
reporting period as the S&P SmallCap 600 Index rose 17.3% versus the S&P 500
Index's return of 7.2%. Attractive valuations and strong earnings comparisons
helped to generate sustained interest in small company investing. Although this
segment of the market continued to display the usual volatility, the breadth of
the market improved considerably as interest moved beyond technology stocks and
into areas like energy, producer durables and health care. Market psychology
also played a significant role in creating some fairly wide swings as the debate
over "old economy" and "new economy" stocks was played out in many sectors. This
sentiment was most obviously shown early in the period when the market fell in
love with many "new economy" growth stocks, which were later subjected to severe
selling pressure when many "old economy" value stocks were back in favor.
In this environment, we are pleased to report Firstar Emerging Growth Fund
outperformed both the S&P SmallCap 600 Index and the Russell 2000 Index during
the reporting period. The Fund's return was 37.1% (Institutional shares) while
the S&P 600 and the Russell 2000 earned 17.3% and 18.7%, respectively.
As a small company investment manager with a broadly diversified
growth-at-reasonable-prices style, we benefited from our participation in a
number of key segments which performed well in the period. The continued run-up
by technology stocks early in the period led to the elimination or reduction in
weighting of a number of holdings which had either met valuation targets or were
unattractive from a risk/reward standpoint. Examples of stocks eliminated from
the portfolio include Emulex and Qlogic. Proceeds were reinvested in several
sectors we believe to be more attractive including: producer durables, medical,
utilities and insurance. Specific examples of new positions include: Astec
Industries, which manufactures equipment for road construction and Patterson
Dental, a distributor of products to dental professionals. Please see the
Schedule of Investment section of this report for a complete list of portfolio
holdings.
That said, a number of technology related issues generated exceptional
performance including Kulicke & Soffa, Qlogic, and Burr-Brown - all of which
earned over 100% during the period.
While technology companies provided the biggest contribution to the Fund's
performance, numerous stocks in a cross section of other industries like energy,
retail, producer durables and medical also helped the Fund's performance. Our
stock selection and timely sector allocation decisions helped to drive overall
results.
Looking ahead, we will continue to look for opportunities to buy well-managed
companies at reasonable valuations. Special attention may be given to areas of
the market that have shown relative weakness due to concerns over the prospects
for an economic slowdown. We will look to take a balanced approach to managing
risk by monitoring industry and individual stock position sizes with respect to
risk levels, and we will look to avoid over-paying for growth while focusing our
attention on bottom-up stock selection.
We appreciate your investment in Firstar Emerging Growth Fund.
PORTFOLIO MANAGER PROFILE
ROBERT ANTHONY, Senior Vice President and Senior Portfolio Manager with Firstar
Investment Research & Management Company, LLC (FIRMCO) and GREGORY GLIDDEN,
Senior Vice President and Senior Portfolio Manager co-manage the Fund - Mr.
Anthony since November 8, 1999 and Mr. Glidden since March 1, 1999. Mr. Anthony
has been with Firstar since 1973 and has 27 years of investment management
experience. He received his BS from the University of Missouri. Mr. Glidden has
been with Firstar since 1982 and has 17 years of investment management
experience. He received his BS from Indiana University and his MBA from the
University of Missouri.
18
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Emerging Growth Fund - Institutional
8/15/97 10,000
10/97 10,310
10/98 9,655
10/99 9,407
4/00 12,899
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 8/15/97 (INCEPTION).
PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE WAIVERS, TOTAL
RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL SHARES, WHICH
HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE FEES AND EXPENSES
WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE BEEN REDUCED. RETURNS
SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER DISTRIBUTIONS. PAST
PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------
Fiscal
Year-To-Date 1 Year Since Inception
--------------------------------------------------------------------------------------
<S> <C> <C> <C>
FIRSTAR EMERGING GROWTH FUND - INSTITUTIONAL 37.1 39.1 9.9 (8/15/97)
FIRSTAR EMERGING GROWTH FUND - A - NO LOAD 36.9 38.9 9.6 (8/15/97)
FIRSTAR EMERGING GROWTH FUND - A - LOAD<F1> 29.4 31.3 7.4 (8/15/97)
FIRSTAR EMERGING GROWTH FUND - B - NO LOAD 36.4 37.8 26.7 (3/1/99)
FIRSTAR EMERGING GROWTH FUND - B - LOAD<F2> 31.4 32.8 23.4 (3/1/99)
S&P SMALLCAP 600 INDEX<F3> 17.3 20.5 8.1 (8/15/97)
RUSSELL 2000 INDEX<F4> 18.7 18.4 8.8 (8/1/95)
--------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The S&P SmallCap 600 Index is a capitalization weighted index that measures
the performance of selected U.S. stocks with small market capitalizations.
<F4> The Russell 2000, an unmanaged index, consists of the smallest 2,000
companies in a group of 3,000 U.S. companies in the Russell 3000 Index, as
ranked by total market capitalization.
An investment cannot be made directly in an index.
Series A shares have a 5.50% maximum sales load and are subject to an annual
0.25% service organization fee. Series B shares have a 5.00% maximum deferred
sales charge and are subject to an annual 0.25% service organization fee and a
0.75% 12b-1 fee. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 4/30/00
----------------------------------------
THE BISYS GROUP, INC. 3.6%
----------------------------------------
ACXIOM CORPORATION 3.2%
----------------------------------------
ARTHUR J. GALLAGHER & COMPANY 2.7%
----------------------------------------
CDW COMPUTER CENTERS, INC. 2.6%
----------------------------------------
INTEGRATED DEVICE TECHNOLOGY, INC. 2.2%
----------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
-----------------------------
$195,872,578
-----------------------------
19
<PAGE>
MICROCAP FUND
Greed, fear, liquidity and volatility were major themes during the past six
months. From November 1999 through March 2000, greed was the key theme as
virtually all stocks in the technology universe appreciated without regard to
valuation. This phenomenon can partially be explained by the liquidity injected
into the market by the Federal Reserve late in 1999 as a cushion for possible
Y2K issues. Stock valuations went to all time highs in the technology sector
until some of the liquidity began to be drained from the market in early 2000.
In March, fear of inflation and rising interest rates among investors caused
many tech stocks, particularly internet related issues, to depreciate rapidly.
Ultimately, this downturn affected the entire market. This market correction was
characterized by extreme volatility. Though many of these technology companies
were still fundamentally strong, investors had difficulty rationalizing such
lofty valuations.
We are pleased to report Firstar MicroCap Fund outperformed its benchmark, the
Russell 2000 Index, during this volatile period. For the six-month period
beginning November 1, 1999 and ending April 30, 2000, the Fund's return was
81.8% (Institutional shares) versus the benchmark's return of 18.7%. During the
same period, the Fund ranked number one (Institutional shares) out of 268 funds
in the Lipper Small-Cap Growth category. As was the case in 1999, the Fund was
named a Select Fund by Standard & Poor's for the small-cap growth category. This
designation was awarded to only 28 of the 382 funds in S&P's small-cap growth
fund universe and is based on a six-month moving average of three years of
absolute and volatility adjusted performance data relative to 382 small-cap
growth funds.
In the first six months of the Fund's fiscal year, the portfolio remained
overweighted in technology, energy and consumer cyclicals. Given the strong
fundamentals of many companies in the oil and gas sector, we increased our
weighting by taking positions in companies such as H.S. Resources, Cabot Oil &
Gas and Oceaneering International. We also added technology companies like
Aeroflex and Renec to capitalize on the growth of the wireless and fiber-optic
industries. As the market's appetite for growth-at-any-price shifted towards
growth-at-a-reasonable-price, we eliminated positions in several technology
stocks which had met our price targets including Ancor, DSL.Net and P-Com. Each
of these companies made positive contributions to the Fund's return prior to
selling our positions. Please see the Schedule of Investments section of this
report for a complete listing of the portfolio holdings.
Although we expect the interest rate hikes of the past six-months to ultimately
slow economic growth, we believe the backdrop for equity investments remains
quite positive for the balance of 2000 as we expect inflation to remain low,
economic growth to remain steady and spending on technology infrastructure to
remain strong. Our outlook on microcap stocks remains particularly positive as
nearly one-third of all microcap stocks (stocks of companies with market
capitalizations less than $250 million) currently trade at less than ten times
trailing earnings versus the S&P 500 which currently trades at over 25 times
trailing earnings. The last time microcap stocks were so inexpensive relative to
large-cap stocks was in 1991 which preceded a multi-year period of
outperformance by microcap stocks.
As this report is being prepared, we are in the midst of a significant market
correction in both the NASDAQ Composite Index and Russell 2000 Index which are
off their all-time highs by 37% and 25%, respectively (as of May 30, 2000). Sir
John Templeton, a world-renowned international investment manager was once
quoted as saying, " I always made money when I bought at the point of maximum
pessimism." In keeping with this theme, we re-opened Firstar MicroCap Fund to
new investors on May 15, 2000. The Fund will again close to new investors upon
receiving $50 million in additional investments as we are committed to
maintaining the integrity of the Fund and its investment style.
Thank you for your investment in Firstar MicroCap Fund.
PORTFOLIO MANAGER PROFILE
JOSEPH A. FROHNA, CFA, CPA, Senior Vice President and Senior Portfolio Manager
of Firstar Investment Research & Management Company, LLC (FIRMCO) has managed
the Fund since September 9, 1997. Joe has been with Firstar since 1995 and has
seven years of investment management experience. Joe received his BBA from the
University of Wisconsin-Whitewater in 1986 and his MBA from the University of
Michigan in 1994. Joe is a Chartered Financial Analyst and a Certified Public
Accountant.
20
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
MicroCap Fund - Institutional
8/1/95 10,000
10/95 16,393
10/96 17,188
10/97 22,365
10/98 17,555
10/99 31,083
4/30 56,513
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 8/1/95 (INCEPTION).
PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE WAIVERS, TOTAL
RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL SHARES, WHICH
HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE FEES AND EXPENSES
WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE BEEN REDUCED. RETURNS
SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER DISTRIBUTIONS. PAST
PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------
Fiscal
Year-To-Date 1 Year 3 Years Since Inception
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FIRSTAR MICROCAP FUND - INSTITUTIONAL 81.8 153.9 54.4 44.0 (8/1/95)
FIRSTAR MICROCAP FUND - A - NO LOAD 81.6 153.1 54.0 43.6 (8/1/95)
FIRSTAR MICROCAP FUND - A - LOAD<F2> 73.4 141.6 51.6 42.2 (8/1/95)
FIRSTAR MICROCAP FUND - B - NO LOAD 80.9 150.9 -- 145.3 (3/1/99)
FIRSTAR MICROCAP FUND - B - LOAD<F3> 75.9 145.9 -- 142.3 (3/1/99)
RUSSELL 2000 INDEX<F1> 18.7 18.4 15.2 13.2 (8/1/95)
--------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> The Russell 2000, an unmanaged index, consists of the smallest 2,000
companies in a group of 3,000 U.S. companies in the Russell 3000 Index, as
ranked by total market capitalization.
<F2> Reflects maximum sales charge of 5.50%.
<F3> Reflects maximum deferred sales charge of 5.00%.
An investment cannot be made directly in an index.
The Fund participates in the Initial Public Offering ("IPO") market, and a
portion of the Fund's returns are attributable to its investments in IPOs, which
have a magnified impact due to the Fund's relatively small asset base. There is
no guarantee that, as the Fund's assets grow, it will continue to experience
substantially similar performance by investing in IPOs.
Series A shares have a 5.50% maximum sales load and are subject to an annual
0.25% service organization fee. Series B shares have a 5.00% maximum deferred
sales charge and are subject to an annual 0.25% service organization fee and a
0.75% 12b-1 fee. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 4/30/00
------------------------------------
AEROFLEX, INC. 3.6%
------------------------------------
REMEL, INC. 3.5%
------------------------------------
OCEANEERING INTERNATIONAL, INC. 2.0%
------------------------------------
HALL KINTON & ASSOCIATES, INC. 2.0%
------------------------------------
CABOT OIL & GAS CORPORATION 2.0%
------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
------------------------------------
$323,842,201
------------------------------------
21
<PAGE>
CORE INTERNATIONAL EQUITY FUND
Trends in international equity markets during the six months ended April 30,
2000 have led to a great divergence in investment performance. The first four
months of the period were particularly good for growth oriented investors.
Rising economic growth projections, stable inflation indicators, and most
importantly, the spill-over effect of the powerful technology and telecom rally
in the U.S. market led to investor euphoria in the technology, media and telecom
sectors. This rally was however relatively narrow on a sector basis. Several
substantial sectors, including energy, finance, health, minerals, retail trade
and transportation had negative returns during the same period. The
international technology sector rose approximately 58% during these same four
months. Investors clearly favored momentum stocks at the expense of "value"
names, willing to pay any price for what they saw as internet plays.
The markets began to turn by mid-March. Attractively valued stocks began to
regain their customary luster once again, though this rotation started too late
to give value stocks the upper hand for the entire period. For the six months
ended April 30, 2000, Firstar Core International Equity Fund's return was -0.4%
(Institutional shares), lagging the return of its benchmark, the Morgan Stanley
Capital International Europe, Australia and Far East (EAFE) Index which returned
+6.7% during the same period. Stock selection was the reason for our relative
returns. Not being able to own more than a select few of the generally expensive
telecom and technology stocks was all that was necessary to lag the Index. Being
a disciplined value investor also led us to overweight positions in the
manufacturing and industrial sectors, which despite a favorable earnings
outlook, also fell behind the tech/telecom driven market.
We believe international equities offer attractive return potential, based on
several positive forces that should support further price appreciation.
Estimates for global economic growth continue to increase, which should also
push corporate profits higher. Also, high consumer confidence is fanning
investor interest in equities. Share ownership is particularly popular among
European investors, who still have a relatively high percentage of their
holdings in low yielding bonds. However, the recent market volatility reflects
the fact that risks have risen as well. Concerned by indications of rising
inflation, the Federal Reserve, the Bank of England and the European Central
Bank are all in a tightening mode, which may ultimately stifle growth. This
comes at a time when valuations are near record highs in many markets. After the
past two quarters, characterized by indiscriminate buying of anything related to
internet and mobile communications, we see much more selective investing ahead;
we believe valuations and earnings will matter again. We believe the Internet
will continue to produce opportunities, not investment opportunities per se, but
as a tool to improve the operating profitability of more traditional companies.
We believe our disciplined value approach to international investing will do
well in this environment.
We appreciate your investment in Firstar Core International Equity Fund.
PORTFOLIO MANAGER PROFILE
ANDREW B. WILLIAMS, CFA, Senior Vice President of The Glenmede Trust Company.
Mr. Williams has been with The Glenmede Trust Company since 1985 and has managed
Firstar Core International Equity Fund since its inception on November 4, 1999.
22
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Core International Equity Fund - Institutional
11/4/99 10,000
4/00 9,962
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 11/4/99 (INCEPTION).
PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE WAIVERS, TOTAL
RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL SHARES, WHICH
HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE FEES AND EXPENSES
WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE BEEN REDUCED. RETURNS
SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER DISTRIBUTIONS. PAST
PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
--------------------------------------------------------------------------------
Since Inception<F4>
--------------------------------------------------------------------------------
FIRSTAR CORE INTERNATIONAL EQUITY FUND - INSTITUTIONAL (0.4) (11/4/99)
FIRSTAR CORE INTERNATIONAL EQUITY FUND - A - NO LOAD (0.6) (11/4/99)
FIRSTAR CORE INTERNATIONAL EQUITY FUND - A - LOAD<F1> (6.1) (11/4/99)
FIRSTAR CORE INTERNATIONAL EQUITY FUND - B - NO LOAD (0.7) (11/4/99)
FIRSTAR CORE INTERNATIONAL EQUITY FUND - B - LOAD<F2> (5.7) (11/4/99)
EAFE INDEX<F3> 6.7 (11/4/99)
--------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The Morgan Stanley Capital International Europe, Australia and Far East
Index ("EAFE") is an unmanaged index composed of 20 European and Pacific
Basin countries. The EAFE Index is the most recognized international index
and is weighted by market capitalization.
<F4> Not annualized.
An investment cannot be made directly in an index.
Series A shares have a 5.50% maximum sales load and are subject to an annual
0.25% service organization fee. Series B shares have a 5.00% maximum deferred
sales charge and are subject to an annual 0.25% service organization fee and a
0.75% 12b-1 fee. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 COUNTRIES 4/30/00
------------------------------------
JAPAN 18.7%
------------------------------------
GREAT BRITAIN 17.7%
------------------------------------
FRANCE 11.2%
------------------------------------
NETHERLANDS 7.6%
------------------------------------
GERMANY 7.6%
------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
------------------------------------
$39,687,882
------------------------------------
23
<PAGE>
INTERNATIONAL EQUITY FUND
The bifurcation of global equity markets into growth and value sectors continued
into the first two months of the new century. The dramatic performance and
valuation disparity between growth and value stocks peaked in February; and
since then, the vulnerability of high priced growth stocks has become more
evident. Volatility has been even more pronounced during the first weeks of the
second quarter with many global TMT (telecom, media and technology) growth
stocks posting steep declines. Over the past twelve months, this narrow band of
global TMT stocks have performed very well, but the performance of global equity
markets (TMT) has been flat over the period. It is still our opinion that
despite the attractive growth rates and outlook for these companies, there is a
proper price to be paid for them. Great companies/industries do not necessarily
translate into great stocks. Many of these new economy companies have at best
unproven business models and rely on constant access to the capital markets for
money to cover their operating expenses.
In this environment, Firstar International Equity Fund's return for the
six-month reporting period ended April 30, 2000 was -1.4% (Institutional
Shares). The Fund lagged its benchmark, the Morgan Stanley Capital International
Europe, Australia and Far East (EAFE) Index, which returned +6.7% during the
same period.
Our investment outlook and portfolio positioning has not changed significantly
since our last correspondence with you. We are continuing to find opportunities
in Japan, especially in domestic sectors such as financial services and
information technology and services that we believe will benefit from a slowly
recovering economy, increased corporate investment and redeployment of maturing
postal savings accounts. We are further encouraged by improving consumer
sentiment and recently released data showing recurring corporate profit up 46%
year over year primarily due to restructuring and cost cutting. Despite the
strong performance over the past year, we also continue to see opportunities in
Southeast Asian countries as their economies strengthen and banking reforms take
hold. Foreign Direct Investment into the region also continues to be strong.
The continued weakness of the euro has masked strong overall European stock
performance. The restructuring of Europe is advancing and merger and acquisition
activity is moving to a Pan European field. If Germany adopts recently proposed
tax law changes, the largest economy in Europe will see a dramatic
transformation of its economy and industry over the next several years. We have
invested in companies which we feel will benefit from the restructuring to come
either as predator or prey. We also continue to view the euro as undervalued
relative to the US dollar and would expect to see it strengthening over the
course of the year.
Interestingly, the stocks in the Fund exhibit higher than average expected
earnings growth rates over the next three years, yet these same stocks trade at
an average 40% discount to market valuations such as price to earnings, price to
cash flow and price to book value ratios. We are pleased to say that our
value-oriented portfolios have been holding up relatively well so far in this
volatile market, and we are working hard to look for new quality companies to
add to the portfolio if the market corrects further.
We appreciate your investment in Firstar International Equity Fund and the
confidence that you have placed in our firm.
PORTFOLIO MANAGER PROFILE
The portfolio management team of THOMAS HANSBERGER, CFA, CIC, JOHN HOCK, CFA and
CHARLES GULDEN, CFA manages Firstar International Equity Fund. Mr. Hansberger
serves as Chief Executive Officer of Hansberger Global Investors (HGI - the
sub-advisor) and has over thirty-five years of investment management experience.
Mr. Hock joined HGI in 1996 and has seven years of investment management
experience. Mr. Gulden joined HGI in 1996 and has seventeen years of investment
management experience.
24
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
International Equity Fund - Institutional
4/28/94 10,000
10/94 9,995
10/95 9,620
10/96 10,410
10/97 9,879
10/98 8,303
10/99 10,356
4/00 10,215
THIS CHART ASSUMES AN INITIAL INVESTMENT OF $10,000 MADE ON 4/28/94 (INCEPTION).
PERFORMANCE REFLECTS FEE WAIVERS IN EFFECT. IN THE ABSENCE OF FEE WAIVERS, TOTAL
RETURN WOULD BE REDUCED. PERFORMANCE IS SHOWN FOR INSTITUTIONAL SHARES, WHICH
HAVE LOWER EXPENSES THAN SERIES A OR SERIES B SHARES. IF THOSE FEES AND EXPENSES
WERE REFLECTED IN THE CHART ABOVE, TOTAL RETURN WOULD HAVE BEEN REDUCED. RETURNS
SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS AND OTHER DISTRIBUTIONS. PAST
PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE, SO THAT YOUR SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
Fiscal
Year-To-Date 1 Year 3 Years 5 Years Since Inception
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FIRSTAR INTERNATIONAL EQUITY FUND - INSTITUTIONAL (1.4) 3.9 (0.5) 0.4 0.4 (4/28/94)
FIRSTAR INTERNATIONAL EQUITY FUND - A - NO LOAD (1.6) 3.6 (0.8) 0.2 0.1 (4/28/94)
FIRSTAR INTERNATIONAL EQUITY FUND - A - LOAD<F1> (7.0) (2.1) (2.6) (0.9) (0.8) (4/28/94)
FIRSTAR INTERNATIONAL EQUITY FUND - B - NO LOAD (1.9) 2.4 -- -- 19.0 (3/1/99)
FIRSTAR INTERNATIONAL EQUITY FUND - B - LOAD<F2> (6.8) (2.6) -- -- 15.7 (3/1/99)
EAFE INDEX<F3> 6.7 13.9 14.0 10.4 9.6 (4/28/94)
-------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 5.50%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The Morgan Stanley Capital International Europe, Australia and Far East
Index ("EAFE") is an unmanaged index composed of 20 European and Pacific
Basin countries. The EAFE Index is the most recognized international index
and is weighted by market capitalization.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 5.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995,
does not reflect the service organization fees. If service organization fees had
been reflected, performance would be reduced. Series B shares have a 5.00%
maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 COUNTRIES 4/30/00
------------------------------------
JAPAN 22.5%
------------------------------------
GREAT BRITAIN 9.8%
------------------------------------
HONG KONG 4.6%
------------------------------------
SWEDEN 4.6%
------------------------------------
FRANCE 4.5%
------------------------------------
PORTFOLIO HOLDINGS ARE SUBJECT TO CHANGE AND ARE NOT A REPRESENTATION OF THE
FUND'S ENTIRE PORTFOLIO HOLDINGS.
TOTAL FUND NET ASSETS 4/30/00
------------------------------------
$60,655,601
------------------------------------
25
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH EQUITY
INCOME GROWTH AND INCOME INDEX
FUND FUND FUND FUND
--------- -------- ---------- ---------
<S> <C> <C> <C> <C>
ASSETS:
Investments, at value (cost $83,790, $182,505, $522,238, $434,879, $250,068,
$96,468, $414,475, $165,864, $286,822, $38,481, $57,029, respectively) ........ $ 91,096 $230,786 $ 695,053 $ 823,360
Foreign currencies (Cost $102) ................................................ -- -- -- --
Cash .......................................................................... -- 16 -- 204
Income receivable ............................................................. 778 1,556 776 814
Capital shares sold ........................................................... 290 941 256 810
Receivable for securities sold ................................................ 704 1,147 7,428 --
Other assets .................................................................. 65 38 36 111
--------- -------- ---------- ---------
Total Assets ............................................................... 92,933 234,484 703,549 825,299
--------- -------- ---------- ---------
LIABILITIES:
Payable for securities purchased .............................................. 529 2,563 7,819 --
Capital shares redeemed ....................................................... 136 2,275 1,378 2,780
Payable to affiliates ......................................................... 98 290 778 549
Accrued expenses and other liabilities ........................................ 177 48 122 323
--------- -------- ---------- ---------
Total Liabilities .......................................................... 940 5,176 10,097 3,652
--------- -------- ---------- ---------
NET ASSETS ....................................................................... $ 91,993 $229,308 $ 693,452 $ 821,647
========= ======== ========== =========
NET ASSETS CONSIST OF:
Capital stock ................................................................. $ 84,937 $160,744 $ 447,537 $ 433,198
Undistributed net investment income (loss) .................................... 251 346 1,115 643
Undistributed accumulated net realized gains (losses) on
investments ................................................................ (501) 19,937 71,985 (2,790)
Unrealized net appreciation (depreciation) on:
Investments ................................................................ 7,306 48,281 172,815 388,481
Futures contracts .......................................................... -- -- -- 2,115
Foreign currency ........................................................... -- -- -- --
--------- -------- ---------- ---------
Total Net Assets ........................................................... $ 91,993 $229,308 $ 693,452 $ 821,647
========= ======== ========== =========
SERIES A:
Net assets .................................................................... $ 11,413 $ 53,470 $ 181,142 $ 146,680
Shares authorized ($.0001 par value) .......................................... 100,000 500,000 500,000 500,000
Shares issued and outstanding ................................................. 1,040 1,640 4,036 1,536
Net asset value and redemption price per share<F1> ............................ $ 10.96 $ 32.60 $ 44.90 $ 95.48
========= ======== ========== =========
Maximum offering price per share<F1> .......................................... $ 11.60 $ 34.50 $ 47.51 $ 101.04
========= ======== ========== =========
SERIES B:
Net assets .................................................................... $ 3,582 $ 1,264 $ 2,461 $ 9,132
Shares authorized ($.0001 par value) .......................................... 100,000 500,000 500,000 500,000
Shares issued and outstanding ................................................. 311 39 55 96
Net asset value, redemption price and offering price per share<F1> ............ $ 10.98 $ 32.69 $ 44.75 $ 95.31
========= ======== ========== =========
SERIES INSTITUTIONAL:
Net assets .................................................................... $ 76,998 $174,574 $ 509,849 $ 665,835
Shares authorized ($.0001 par value) .......................................... 100,000 500,000 500,000 500,000
Shares issued and outstanding ................................................. 7,057 5,347 11,383 6,963
Net asset value, redemption price and offering price per share<F1> ............ $ 10.98 $ 32.65 $ 44.97 $ 95.63
========= ======== ========== =========
26 See notes to the financial statements.
<PAGE>
MIDCAP SPECIAL EMERGING
GROWTH INDEX GROWTH GROWTH
FUND FUND FUND FUND
--------- -------- --------- ---------
<S> <C> <C> <C> <C>
ASSETS:
Investments, at value (cost $83,790, $182,505, $522,238, $434,879, $250,068,
$96,468, $414,475, $165,864, $286,822, $38,481, $57,029, respectively) ..... $ 380,492 $104,407 $ 501,649 $ 200,657
Foreign currencies (Cost $102) ............................................. -- -- -- --
Cash ....................................................................... -- -- -- 378
Income receivable .......................................................... 132 98 245 73
Capital shares sold ........................................................ 320 93 501 85
Receivable for securities sold ............................................. 1,751 91 7,947 1,610
Other assets ............................................................... 40 34 31 31
--------- -------- --------- ---------
Total Assets ............................................................ 382,735 104,723 510,373 202,834
--------- -------- --------- ---------
LIABILITIES:
Payable for securities purchased ........................................... 2,484 -- 12,883 6,503
Capital shares redeemed .................................................... 5,058 29 448 162
Payable to affiliates ...................................................... 403 61 606 241
Accrued expenses and other liabilities ..................................... 49 132 70 55
--------- -------- --------- ---------
Total Liabilities ....................................................... 7,994 222 14,007 6,961
--------- -------- --------- ---------
NET ASSETS .................................................................... $ 374,741 $104,501 $ 496,366 $ 195,873
========= ======== ========= =========
NET ASSETS CONSIST OF:
Capital stock .............................................................. $ 216,039 $ 92,708 $ 259,797 $ 150,449
Undistributed net investment income (loss) ................................. (184) 78 (775) (391)
Undistributed accumulated net realized gains (losses) on
investments ............................................................. 28,462 3,675 150,170 11,022
Unrealized net appreciation (depreciation) on:
Investments ............................................................. 130,424 7,939 87,174 34,793
Futures contracts ....................................................... -- 101 -- --
Foreign currency ........................................................ -- -- -- --
--------- -------- --------- ---------
Total Net Assets ........................................................ $ 374,741 $104,501 $ 496,366 $ 195,873
========= ======== ========= =========
SERIES A:
Net assets
Shares authorized ($.0001 par value) ....................................... $ 51,718 $ 1,391 $ 100,515 $ 11,155
Shares issued and outstanding .............................................. 500,000 100,000 500,000 100,000
Net asset value and redemption price per share<F1> ......................... 1,204 119 2,076 877
Maximum offering price per share<F1> ....................................... $ 42.94 $ 11.65 $ 48.42 $ 12.72
========= ======== ========= =========
$ 45.46 $ 12.33 $ 51.24 $ 13.46
========= ======== ========= =========
SERIES B:
Net assets
Shares authorized ($.0001 par value) ....................................... $ 1,144 $ 295 $ 248 $ 222
Shares issued and outstanding .............................................. 500,000 100,000 500,000 100,000
Net asset value, redemption price and offering price per share<F1> ......... 27 25 5 18
$ 42.57 $ 11.63 $ 48.02 $ 12.62
========= ======== ========= =========
SERIES INSTITUTIONAL:
Net assets ................................................................. $ 321,879 $102,815 $ 395,603 $ 184,496
Shares authorized ($.0001 par value) ....................................... 500,000 100,000 500,000 100,000
Shares issued and outstanding .............................................. 7,391 8,828 8,049 14,434
Net asset value, redemption price and offering price per share<F1> ......... $ 43.55 $ 11.65 $ 49.15 $ 12.78
========= ======== ========= =========
<CAPTION>
CORE
INTERNATIONAL INTERNATIONAL
MICROCAP EQUITY EQUITY
FUND FUND FUND
--------- ------------- -------------
<S> <C> <C> <C>
ASSETS:
Investments, at value (cost $83,790, $182,505, $522,238, $434,879, $250,068,
$96,468, $414,475, $165,864, $286,822, $38,481, $57,029, respectively) ..... $ 324,463 $ 38,229 $ 59,704
Foreign currencies (Cost $102) ............................................. -- 99 --
Cash ....................................................................... -- 583 --
Income receivable .......................................................... 130 149 441
Capital shares sold ........................................................ 260 145 83
Receivable for securities sold ............................................. 1,693 1,139 1,501
Other assets ............................................................... 30 3 28
--------- ------------- -------------
Total Assets ............................................................ 326,576 40,347 61,757
--------- ------------- -------------
LIABILITIES:
Payable for securities purchased ........................................... 1,116 -- 599
Capital shares redeemed .................................................... 978 5 94
Payable to affiliates ...................................................... 563 63 115
Accrued expenses and other liabilities ..................................... 77 591 293
--------- ------------- -------------
Total Liabilities ....................................................... 2,734 659 1,101
--------- ------------- -------------
NET ASSETS .................................................................... $ 323,842 $ 39,688 $ 60,656
========= ============= =============
NET ASSETS CONSIST OF:
Capital stock .............................................................. $ 146,731 $ 39,795 $ 69,678
Undistributed net investment income (loss) ................................. (1,966) 87 (278)
Undistributed accumulated net realized gains (losses) on
investments ............................................................. 141,436 61 (11,364)
Unrealized net appreciation (depreciation) on:
Investments ............................................................. 37,641 (252) 2,675
Futures contracts ....................................................... -- -- --
Foreign currency ........................................................ -- (3) (55)
--------- ------------- -------------
Total Net Assets ........................................................ $ 323,842 $ 39,688 $ 60,656
========= ============= =============
SERIES A:
Net assets
Shares authorized ($.0001 par value) ....................................... $ 40,097 $ 30 $ 5,963
Shares issued and outstanding .............................................. 50,000 100,000 500,000
Net asset value and redemption price per share<F1> ......................... 1,324 3 327
Maximum offering price per share<F1> ....................................... $ 30.28 $ 9.93 $ 18.23
========= ============= =============
$ 32.04 $ 10.51 $ 19.29
========= ============= =============
SERIES B:
Net assets
Shares authorized ($.0001 par value) ....................................... $ 845 $ 45 $ 302
Shares issued and outstanding .............................................. 50,000 100,000 500,000
Net asset value, redemption price and offering price per share<F1> ......... 28 5 17
$ 29.98 $ 9.92 $ 18.01
========= ============= =============
SERIES INSTITUTIONAL:
Net assets ................................................................. $ 282,900 $ 39,613 $ 54,391
Shares authorized ($.0001 par value) ....................................... 50,000 100,000 500,000
Shares issued and outstanding .............................................. 9,186 3,982 2,964
Net asset value, redemption price and offering price per share<F1> ......... $ 30.80 $ 9.95 $ 18.35
========= ============= =============
<F1> Amounts may not recalculate due to rounding.
</TABLE>
See notes to the financial statements. 27
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
BALANCED INCOME FUND BALANCED GROWTH FUND
------------------------------ ------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, 2000 OCT. 31, 1999 APRIL 30, 2000 OCT. 31, 1999
-------------- ------------- -------------- -------------
(Unaudited) (Unaudited)
OPERATIONS:
<S> <C> <C> <C> <C>
Net investment income (loss) .............................. $ 1,121 $ 1,404 $ 2,126 $ 4,649
Net realized gain (loss) on:
Investments ............................................ (406) (452) 20,688 12,374
Foreign currency ....................................... -- -- -- --
Net change in unrealized appreciation (depreciation) on:
Investments ............................................ 2,478 2,065 11,158 (3,281)
Foreign currency ....................................... -- -- -- --
-------------- ------------- -------------- -------------
Net increase (decrease) in net assets resulting
from operations ........................................ 3,193 3,017 33,972 13,742
-------------- ------------- -------------- -------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ............................................... 57,258 32,182 34,611 65,070
Shares issued to owners in
reinvestment of dividends .............................. 1,552 1,347 14,184 12,405
Shares redeemed ........................................... (32,165) (13,627) (74,208) (91,179)
-------------- ------------- -------------- -------------
Net increase (decrease) in net assets as a result of
capital share transactions ............................. 26,645 19,902 (25,413) (13,704)
-------------- ------------- -------------- -------------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income ................................ (137) (312) (436) (953)
From net realized gains ................................... (227) (449) (2,820) (1,908)
-------------- ------------- -------------- -------------
(364) (761) (3,256) (2,861)
-------------- ------------- -------------- -------------
DISTRIBUTIONS TO SERIES B SHAREOWNERS:
From net investment income ................................ (25) (9) (5) (3)
From net realized gains ................................... (46) -- (42) --
-------------- ------------- -------------- -------------
(71) (9) (47) (3)
-------------- ------------- -------------- -------------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income ................................ (874) (1,044) (1,707) (3,692)
From net realized gains ................................... (922) (1,369) (9,415) (6,088)
-------------- ------------- -------------- -------------
(1,796) (2,413) (11,122) (9,780)
-------------- ------------- -------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ...................... 27,607 19,736 (5,866) (12,606)
NET ASSETS:
Beginning of period ....................................... 64,386 44,650 235,174 247,780
-------------- ------------- -------------- -------------
End of period (including undistributed
net investment income (loss) of $251, $166,
$346, $368, $1,115, $832, $643, $570, $(184),
$(4), $78, $(4), and $(775), respectively) ............. $ 91,993 $ 64,386 $ 229,308 $ 235,174
============== ============= ============== =============
<CAPTION>
GROWTH AND INCOME FUND
------------------------------
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, 2000 OCT. 31, 1999
-------------- -------------
(Unaudited)
OPERATIONS:
<S> <C> <C>
Net investment income (loss) .............................. $ 1,795 $ 6,818
Net realized gain (loss) on:
Investments ............................................ 71,633 61,424
Foreign currency ....................................... -- --
Net change in unrealized appreciation (depreciation) on:
Investments ............................................ (29,246) 12,321
Foreign currency ....................................... -- --
-------------- -------------
Net increase (decrease) in net assets resulting
from operations ........................................ 44,182 80,563
-------------- -------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ............................................... 75,413 179,414
Shares issued to owners in
reinvestment of dividends .............................. 54,984 49,818
Shares redeemed ........................................... (146,306) (191,334)
-------------- -------------
Net increase (decrease) in net assets as a result of
capital share transactions ............................. (15,909) 37,898
-------------- -------------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income ................................ (230) (1,524)
From net realized gains ................................... (15,918) (13,914)
-------------- -------------
(16,148) (15,438)
-------------- -------------
DISTRIBUTIONS TO SERIES B SHAREOWNERS:
From net investment income ................................ -- (1)
From net realized gains ................................... (174) --
-------------- -------------
(174) (1)
-------------- -------------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income ................................ (1,282) (5,308)
From net realized gains ................................... (44,113) (35,752)
-------------- -------------
(45,395) (41,060)
-------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ...................... (33,444) 61,962
NET ASSETS:
Beginning of period ....................................... 726,896 664,934
-------------- -------------
End of period (including undistributed
net investment income (loss) of $251, $166,
$346, $368, $1,115, $832, $643, $570, $(184),
$(4), $78, $(4), and $(775), respectively) ............. $ 693,452 $ 726,896
============== =============
</TABLE>
28 See notes to the financial statements.
<PAGE>
<TABLE>
<CAPTION>
EQUITY INDEX FUND GROWTH FUND
------------------------------ ------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, 2000 OCT. 31, 1999 APRIL 30, 2000 OCT. 31, 1999
-------------- ------------- -------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) ........................... $ 4,118 $ 7,373 $ (180) $ (302)
Net realized gain (loss) on:
Investments ......................................... (641) 17,654 29,075 18,890
Foreign currency .................................... -- -- -- --
Net change in unrealized appreciation (depreciation) on:
Investments ......................................... 46,417 109,742 36,603 25,991
Foreign currency .................................... -- -- -- --
-------------- ------------- -------------- -------------
Net increase (decrease) in net assets resulting
from operations ..................................... 49,894 134,769 65,498 44,579
-------------- ------------- -------------- -------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ............................................ 248,139 341,167 176,546 218,241
Shares issued to owners in
reinvestment of dividends ........................... 19,112 9,845 15,065 22,498
Shares redeemed ........................................ (189,289) (322,755) (218,958) (138,508)
-------------- ------------- -------------- -------------
Net increase (decrease) in net assets as a result of
capital share transactions .......................... 77,962 28,257 (27,347) 102,231
-------------- ------------- -------------- -------------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income ............................. (594) (1,277) -- (28)
From net realized gains ................................ (3,195) (710) (2,451) (4,421)
-------------- ------------- -------------- -------------
(3,789) (1,987) (2,451) (4,449)
-------------- ------------- -------------- -------------
DISTRIBUTIONS TO SERIES B SHAREOWNERS:
From net investment income ............................. (7) (8) -- --
From net realized gains ................................ (127) -- (42) --
-------------- ------------- -------------- -------------
(134) (8) (42) --
-------------- ------------- -------------- -------------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
Shareowners:
From net investment income ............................. (3,444) (6,138) -- (237)
From net realized gains ................................ (13,863) (2,753) (15,709) (23,343)
-------------- ------------- -------------- -------------
(17,307) (8,891) (15,709) (23,580)
-------------- ------------- -------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ................... 106,626 152,140 19,949 118,781
NET ASSETS:
Beginning of period .................................... 715,021 562,881 354,792 236,011
-------------- ------------- -------------- -------------
End of period (including undistributed
net investment income (loss) of $251, $166,
$346, $368, $1,115, $832, $643, $570, $(184),
$(4), $78, $(4), and $(775), respectively) ........... $ 821,647 $ 715,021 $ 374,741 $ 354,792
============== ============= ============== =============
<CAPTION>
MIDCAP INDEX FUND SPECIAL GROWTH FUND
----------------- ------------------------------
NOV. 4, 1999<F1> SIX MONTHS YEAR
THROUGH ENDED ENDED
APRIL 30, 2000 APRIL 30, 2000 OCT. 31, 1999
----------------- -------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C> <C>
OPERATIONS:
Net investment income (loss) ........................... $ 423 $ (771) $ (103)
Net realized gain (loss) on:
Investments ......................................... 3,675 153,186 38,420
Foreign currency .................................... -- -- --
Net change in unrealized appreciation (depreciation) on:
Investments ......................................... 8,040 (25,426) (27,055)
Foreign currency .................................... -- -- --
----------------- -------------- -------------
Net increase (decrease) in net assets resulting
from operations ..................................... 12,138 126,989 11,262
----------------- -------------- -------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ............................................ 96,185 56,021 255,663
Shares issued to owners in
reinvestment of dividends ........................... 318 8,062 4,422
Shares redeemed ........................................ (3,795) (141,767) (411,662)
----------------- -------------- -------------
Net increase (decrease) in net assets as a result of
capital share transactions .......................... 92,708 (77,684) (151,577)
----------------- -------------- -------------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income ............................. (3) -- --
From net realized gains ................................ -- (1,850) (1,086)
----------------- -------------- -------------
(3) (1,850) (1,086)
----------------- -------------- -------------
DISTRIBUTIONS TO SERIES B SHAREOWNERS:
From net investment income ............................. -- -- --
From net realized gains ................................ -- (3) --
----------------- -------------- -------------
-- (3) --
----------------- -------------- -------------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income ............................. (342) -- --
From net realized gains ................................ -- (6,917) (3,772)
----------------- -------------- -------------
(342) (6,917) (3,772)
----------------- -------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ................... 104,501 40,535 (145,173)
NET ASSETS:
Beginning of period .................................... -- 455,831 601,004
----------------- -------------- -------------
End of period (including undistributed
net investment income (loss) of $251, $166,
$346, $368, $1,115, $832, $643, $570, $(184),
$(4), $78, $(4), and $(775), respectively) ........... $ 104,501 $ 496,366 $ 455,831
================= ============== =============
<F1> Commencement of operations.
</TABLE>
See notes to the financial statements. 29
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
EMERGING GROWTH FUND
------------------------------
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, 2000 OCT. 31, 1999
-------------- -------------
(Unaudited)
<S> <C> <C>
OPERATIONS:
Net investment income (loss) .................................................... $ (390) $ (157)
Net realized gain (loss) on:
Investments .................................................................. 30,172 (12,915)
Foreign currency ............................................................. -- --
Net change in unrealized appreciation (depreciation) on:
Investments .................................................................. 24,180 8,864
Foreign currency ............................................................. -- --
-------------- -------------
Net increase (decrease) in net assets resulting from operations ................. 53,962 (4,208)
-------------- -------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ..................................................................... 24,612 140,767
Shares issued to owners in
reinvestment of dividends .................................................... -- 71
Shares redeemed ................................................................. (32,017) (60,500)
-------------- -------------
Net increase (decrease) in net assets as a result of capital share transactions . (7,405) 80,338
-------------- -------------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income ...................................................... -- (15)
From net realized gains ......................................................... -- --
-------------- -------------
-- (15)
-------------- -------------
DISTRIBUTIONS TO SERIES B SHAREOWNERS:
From net investment income ...................................................... -- --
From net realized gains ......................................................... -- --
-------------- -------------
-- --
-------------- -------------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income ...................................................... -- (83)
From net realized gains ......................................................... -- --
-------------- -------------
-- (83)
-------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ............................................ 46,557 76,032
NET ASSETS:
Beginning of period ............................................................. 149,316 73,284
-------------- -------------
End of period (including undistributed net investment income (loss) of
$(391), $(2), $(1,966), $(4), $87, $176 and $(278), respectively) ............ $ 195,873 $ 149,316
============== =============
<CAPTION>
MICROCAP FUND
------------------------------
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, 2000 OCT. 31, 1999
-------------- -------------
(Unaudited)
<S> <C> <C>
OPERATIONS:
Net investment income (loss) .................................................... $ (1,955) $ (1,572)
Net realized gain (loss) on:
Investments .................................................................. 144,665 47,964
Foreign currency ............................................................. -- --
Net change in unrealized appreciation (depreciation) on:
Investments .................................................................. 3,340 29,718
Foreign currency ............................................................. -- --
-------------- -------------
Net increase (decrease) in net assets resulting from operations ................. 146,050 76,110
-------------- -------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ..................................................................... 78,163 53,050
Shares issued to owners in
reinvestment of dividends .................................................... 46,293 264
Shares redeemed ................................................................. (70,637) (41,236)
-------------- -------------
Net increase (decrease) in net assets as a result of capital share transactions . 53,819 12,078
-------------- -------------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income ...................................................... -- --
From net realized gains ......................................................... (6,165) (44)
-------------- -------------
(6,165) (44)
-------------- -------------
DISTRIBUTIONS TO SERIES B SHAREOWNERS:
From net investment income ...................................................... -- --
From net realized gains ......................................................... (61) --
-------------- -------------
(61) --
-------------- -------------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income ...................................................... -- --
From net realized gains ......................................................... (42,827) (233)
-------------- -------------
(42,827) (233)
-------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ............................................ 150,816 87,911
NET ASSETS:
Beginning of period ............................................................. 173,026 85,115
-------------- -------------
End of period (including undistributed net investment income (loss) of
$(391), $(2), $(1,966), $(4), $87, $176 and $(278), respectively) ............ $ 323,842 $ 173,026
============== =============
</TABLE>
30 See notes to the financial statements.
<PAGE>
<TABLE>
<CAPTION>
CORE INTERNATIONAL EQUITY FUND
------------------------------
NOV. 4, 1999<F1>
THROUGH
APRIL 30, 2000
------------------------------
(Unaudited)
<S> <C>
OPERATIONS:
Net investment income (loss) .......................................................... $ 141
Net realized gain (loss) on:
Investments ........................................................................ 63
Foreign currency ................................................................... (9)
Net change in unrealized appreciation (depreciation) on:
Investments ........................................................................ (251)
Foreign currency ................................................................... (10)
------------------------------
Net increase (decrease) in net assets resulting from operations ....................... (66)
------------------------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ........................................................................... 39,883
Shares issued to owners in
reinvestment of dividends .......................................................... 41
Shares redeemed ....................................................................... (129)
------------------------------
Net increase (decrease) in net assets as a result of capital share transactions ....... 39,795
------------------------------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income ............................................................ --
From net realized gains ............................................................... --
------------------------------
--
------------------------------
DISTRIBUTIONS TO SERIES B SHAREOWNERS:
From net investment income ............................................................ --
From net realized gains ............................................................... --
------------------------------
--
------------------------------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income ............................................................ (41)
From net realized gains ............................................................... --
------------------------------
(41)
------------------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS .................................................. 39,688
NET ASSETS:
Beginning of period ................................................................... --
------------------------------
End of period (including undistributed net investment income (loss) of
$(391), $(2), $(1,966), $(4), $87, $176 and $(278), respectively) .................. $ 39,688
==============================
<F1> Commencement of operations.
<CAPTION>
INTERNATIONAL EQUITY FUND
------------------------------
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, 2000 OCT. 31, 1999
-------------- -------------
(Unaudited)
<S> <C> <C>
OPERATIONS:
Net investment income (loss) .......................................................... $ 28 $ 387
Net realized gain (loss) on:
Investments ........................................................................ (2,373) (3,981)
Foreign currency ................................................................... (109) (189)
Net change in unrealized appreciation (depreciation) on:
Investments ........................................................................ 1,657 14,598
Foreign currency ................................................................... (53) (8)
-------------- -------------
Net increase (decrease) in net assets resulting from operations ....................... (850) 10,807
-------------- -------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ........................................................................... 21,093 20,267
Shares issued to owners in
reinvestment of dividends .......................................................... 147 691
Shares redeemed ....................................................................... (20,427) (21,147)
-------------- -------------
Net increase (decrease) in net assets as a result of capital share transactions ....... 813 (189)
-------------- -------------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income ............................................................ (4) (122)
From net realized gains ............................................................... -- --
-------------- -------------
(4) (122)
-------------- -------------
DISTRIBUTIONS TO SERIES B SHAREOWNERS:
From net investment income ............................................................ -- --
From net realized gains ............................................................... -- --
-------------- -------------
-- --
-------------- -------------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income ............................................................ (188) (767)
From net realized gains ............................................................... -- --
-------------- -------------
(188) (767)
-------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS .................................................. (229) 9,729
NET ASSETS:
Beginning of period ................................................................... 60,885 51,156
-------------- -------------
End of period (including undistributed net investment income (loss) of
$(391), $(2), $(1,966), $(4), $87, $176 and $(278), respectively) .................. $ 60,656 $ 60,885
============== =============
</TABLE>
See notes to the financial statements. 31
<PAGE>
STATEMENT OF OPERATIONS
(AMOUNTS IN THOUSANDS)
SIX MONTHS ENDED APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH EQUITY
INCOME GROWTH AND INCOME INDEX GROWTH
FUND FUND FUND FUND FUND
-------- -------- ---------- -------- --------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividend income:
Domestic ........................................................... $ 281 $ 424 $ 4,585 $ 4,296 $ 1,153
Foreign ............................................................ -- -- -- -- --
Interest income:
Domestic ........................................................... 1,270 2,908 748 1,500 490
Foreign ............................................................ -- -- -- -- --
Other income .......................................................... -- 4 -- -- --
-------- -------- ---------- -------- --------
1,551 3,336 5,333 5,796 1,643
-------- -------- ---------- -------- --------
EXPENSES:
Investment advisory fees .............................................. 310 881 2,629 987 1,399
Administration fees ................................................... 44 126 375 422 199
Transfer agent fees and expenses ...................................... 16 37 91 63 33
Fund accounting fees .................................................. 21 46 45 51 33
Service organization fees - Series A .................................. 15 67 232 183 63
Service organization fees - Series B .................................. 3 1 3 9 1
12b-1 fees - Series B ................................................. 10 3 8 26 4
Custody fees .......................................................... 11 47 53 55 32
Federal and state registration fees ................................... 18 18 31 25 32
Professional fees ..................................................... 21 21 21 21 21
Reports to shareholders ............................................... 11 18 54 36 18
Amortization of organization costs .................................... 5 -- -- -- --
Directors' fees and expenses .......................................... 4 4 4 4 4
Other ................................................................. 1 3 7 24 3
-------- -------- ---------- -------- --------
Total expenses before waiver .......................................... 490 1,272 3,553 1,906 1,842
Less: Waiver of expenses ........................................... (60) (62) (15) (228) (19)
-------- -------- ---------- -------- --------
Net Expenses ....................................................... 430 1,210 3,538 1,678 1,823
-------- -------- ---------- -------- --------
NET INVESTMENT INCOME (LOSS) .............................................. 1,121 2,126 1,795 4,118 (180)
-------- -------- ---------- -------- --------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments ........................................................ (406) 20,688 71,633 (641) 29,075
Foreign currency ................................................... -- -- -- -- --
Net change in unrealized appreciation (depreciation) on:
Investments ........................................................ 2,478 11,158 (29,246) 46,417 36,603
Foreign currency ................................................... -- -- -- -- --
-------- -------- ---------- -------- --------
Net gain (loss) on investments
and foreign currency ........................................... 2,072 31,846 42,387 45,776 65,678
-------- -------- ---------- -------- --------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS ................................................. $ 3,193 $ 33,972 $ 44,182 $ 49,894 $ 65,498
======== ======== ========== ======== ========
</TABLE>
32 See notes to the financial statements.
<TABLE>
<CAPTION>
MIDCAP SPECIAL EMERGING CORE INTERNATIONAL
INDEX GROWTH GROWTH MICROCAP INTERNATIONAL EQUITY
FUND FUND FUND FUND EQUITY FUND FUND
-------- --------- -------- --------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividend income:
Domestic .................................... $ 402 $ 981 $ 238 $ 143 $ -- $ --
Foreign ..................................... -- -- -- -- 340 480
Interest income:
Domestic .................................... 219 598 313 538 -- --
Foreign ..................................... -- -- -- -- 50 65
Other income ................................... -- 59 -- -- -- --
-------- --------- -------- --------- ------------- -------------
621 1,638 551 681 390 545
-------- --------- -------- --------- ------------- -------------
EXPENSES:
Investment advisory fees ....................... 98 1,803 666 2,289 215 436
Administration fees ............................ 42 257 95 163 18 34
Transfer agent fees and expenses ............... 17 90 25 25 16 19
Fund accounting fees ........................... 19 34 23 24 16 25
Service organization fees - Series A ........... 1 125 14 47 0 8
Service organization fees - Series B ........... 0 0 0 1 0 0
12b-1 fees - Series B .......................... 0 1 1 3 0 1
Custody fees ................................... 23 49 29 29 13 20
Federal and state registration fees ............ 19 14 40 18 16 12
Professional fees .............................. 39 21 30 22 40 22
Reports to shareholders ........................ 5 42 10 5 5 4
Amortization of organization costs ............. -- -- 2 2 -- --
Directors' fees and expenses ................... 4 4 4 4 4 4
Other .......................................... 5 7 2 4 1 2
-------- --------- -------- --------- ------------- -------------
Total expenses before waiver ................... 271 2,447 941 2,636 344 587
Less: Waiver of expenses .................... (74) (38) -- -- (95) (70)
-------- --------- -------- --------- ------------- -------------
Net Expenses ................................ 197 2,409 941 2,636 249 517
-------- --------- -------- --------- ------------- -------------
NET INVESTMENT INCOME (LOSS) ....................... 423 (771) (390) (1,955) 141 28
-------- --------- -------- --------- ------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments ................................. 3,675 153,186 30,172 144,665 63 (2,373)
Foreign currency ............................ -- -- -- -- (9) (109)
Net change in unrealized appreciation
(depreciation) on:
Investments ................................. 8,040 (25,426) 24,180 3,340 (251) 1,657
Foreign currency ............................ -- -- -- -- (10) (53)
-------- --------- -------- --------- ------------- -------------
Net gain (loss) on investments
and foreign currency .................... 11,715 127,760 54,352 148,005 (207) (878)
-------- --------- -------- --------- ------------- -------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS .......................... $ 12,138 $ 126,989 $ 53,962 $ 146,050 $ (66) $ (850)
======== ========= ======== ========= ============= =============
</TABLE>
See notes to the financial statements. 33
<PAGE>
FINANCIAL HIGHLIGHTS
INSTITUTIONAL
EQUITY FUNDS
PER SHARE DATA
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------------
NET NET REALIZED AND
ASSET VALUE, NET UNREALIZED GAINS TOTAL FROM
BEGINNING INVESTMENT OR (LOSSES) ON INVESTMENT
OF PERIOD INCOME (LOSS) SECURITIES OPERATIONS
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
BALANCED INCOME
------------------------------------------------------------------------------------------------------------------------------------
Dec. 1, 1997<F1> through Oct. 31, 1998 ................................. $ 10.00 $ 0.30<F10> $ 0.96 $ 1.26
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 11.01 0.31 0.38 0.69
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ............................ 10.96 0.15<F10> 0.21 0.36
------------------------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9>......................................... 22.10 0.53 3.78 4.31
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ............................................ 25.90 0.55<F11> 2.62 3.17
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ............................................ 27.99 0.66 4.20 4.86
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ............................................ 30.51 0.62 1.86 2.48
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 29.85 0.58 1.19 1.77
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ............................ 30.11 0.30 4.21 4.51
------------------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> ........................................ 23.09 0.42 5.14 5.56
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ............................................ 27.63 0.50<F11> 6.61 7.11
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ............................................ 33.08 0.46 8.94 9.40
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ............................................ 39.28 0.47 6.55 7.02
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 44.46 0.41 4.92 5.33
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ............................ 46.15 0.13 2.70 2.83
------------------------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> ......................................... 33.41 0.76 7.71 8.47
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ............................................ 41.08 0.91<F11> 8.68 9.59
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ............................................ 49.43 0.95 14.33 15.28
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ............................................ 63.16 1.02<F10> 12.59 13.61
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 74.66 1.04 17.75 18.79
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ............................ 91.95 0.52<F10> 5.74 6.27
------------------------------------------------------------------------------------------------------------------------------------
GROWTH
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> ........................................ 21.47 0.03 4.16 4.19
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ............................................ 25.61 (0.01)<F11> 4.83 4.82
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ............................................ 30.43 0.04<F11> 6.31 6.35
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ............................................ 35.48 0.07<F10> 5.70 5.77
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 36.05 (0.02)<F10> 6.47 6.45
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ............................ 38.42 (0.01) 7.17 7.16
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000, the fiscal year ended October 31, 1999 and the
period ended October 31, 1998 would have been 1.12%, 1.23%, 1.38%,
respectively; and ratio of net investment income to average net assets for
the period ended April 30, 2000, the fiscal year ended October 31, 1999 and
the period ended October 31, 1998 would have been 2.63%, 2.54%, 2.44%,
respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 1.02%, 1.00%, 0.99%, 1.00%,
1.03%, 1.06%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 1.82%,
1.77%, 1.92%, 2.05%, 1.77%, 1.93%, respectively.
<F6> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 0.94%, 0.93%, 0.94%, 0.94%,
0.98%, 1.01%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 0.58%,
0.98%, 1.04%, 1.27%, 1.59%, 1.59%, respectively.
<F7> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 0.43%, 0.43%, 0.44%, 0.45%,
0.48%, 0.53%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 1.04%,
1.10%, 1.32%, 1.59%, 1.94%, 2.27%, respectively.
34 See notes to the financial statements.
<PAGE>
<TABLE>
<CAPTION>
LESS DISTRIBUTIONS
------------------------------------------
DIVIDENDS
FROM NET DISTRIBUTIONS NET ASSET
INVESTMENT FROM TOTAL VALUE, END TOTAL
INCOME CAPITAL GAINS DISTRIBUTIONS OF PERIOD RETURN
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCED INCOME
------------------------------------------------------------------------------------------------------------------------
Dec. 1, 1997<F1> through Oct. 31, 1998 ............. $ (0.25) $ -- $ (0.25) $ 11.01 12.70%<F2>
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (0.30) (0.44) (0.74) 10.96 6.34%
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ (0.14) (0.20) (0.34) 10.98 3.33%<F2>
------------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> .................... (0.51) -- (0.51) 25.90 19.79%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ (0.53) (0.55) (1.08) 27.99 12.56%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ (0.66) (1.68) (2.34) 30.51 18.39%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ (0.64) (2.50) (3.14) 29.85 8.83%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (0.56) (0.95) (1.51) 30.11 5.87%
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ (0.30) (1.67) (1.97) 32.65 15.41%<F2>
------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> .................... (0.42) (0.60) (1.02) 27.63 25.00%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ (0.47) (1.19) (1.66) 33.08 26.90%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ (0.47) (2.73) (3.20) 39.28 30.83%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ (0.45) (1.39) (1.84) 44.46 18.35%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (0.46) (3.21) (3.67) 46.12 12.04%
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ (0.11) (3.90) (4.01) 44.97 6.62%<F2>
------------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> .................... (0.74) (0.06) (0.80) 41.08 26.02%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ (0.89) (0.35) (1.24) 49.43 23.68%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ (0.94) (0.61) (1.55) 63.16 31.38%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ (1.00) (1.11) (2.11) 74.66 21.93%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (1.03) (0.47) (1.50) 91.95 25.32%
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ (0.50) (2.08) (2.58) 95.63 6.79%<F2>
------------------------------------------------------------------------------------------------------------------------
GROWTH
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> .................... (0.05) -- (0.05) 25.61 19.55%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ -- -- -- 30.43 18.82%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ -- (1.30) (1.30) 35.48 21.56%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ (0.03) (5.17) (5.20) 36.05 18.89%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (0.04) (4.04) (4.08) 38.42 18.18%
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ -- (2.03) (2.03) 43.55 19.01%
------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SUPPLEMENTAL DATA AND RATIOS
---------------------------------------------------------------
RATIO OF NET
NET ASSETS, RATIO OF NET INVESTMENT
END OF EXPENSES INCOME (LOSS) PORTFOLIO
PERIOD TO AVERAGE TO AVERAGE TURNOVER
(000S) NET ASSETS NET ASSETS RATE<F12>
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
BALANCED INCOME
---------------------------------------------------------------------------------------------------------------------
Dec. 1, 1997<F1> through Oct. 31, 1998 ............. $ 34,036 0.75%<F3><F4> 3.07%<F3><F4> 58.33%<F2>
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 49,728 0.93%<F4> 2.84%<F4> 48.46%
---------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ 76,998 0.97%<F4> 2.78%<F4> 93.42%<F2>
---------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> .................... 104,552 0.75%<F5> 2.24%<F5> 61.87%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ 129,415 0.75%<F5> 2.05%<F5> 63.91%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ 164,382 0.75%<F5> 2.31%<F5> 69.90%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ 188,123 0.75%<F5> 2.16%<F5> 56.44%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 180,737 0.93%<F5> 1.84%<F5> 69.42%
---------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ 174,574 0.97%<F5> 1.87%<F5> 81.13%<F2>
---------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> .................... 162,752 0.90%<F6> 1.70%<F6> 47.85%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ 226,888 0.90%<F6> 1.67%<F6> 51.37%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ 366,020 0.87%<F6> 1.34%<F6> 31.36%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ 474,603 0.87%<F6> 1.11%<F6> 48.56%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 531,257 0.92%<F6> 0.99%<F6> 62.20%
---------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ 509,849 0.94%<F6> 0.58%<F6> 91.87%<F2>
---------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> .................... 138,106 0.46%<F7> 2.34%<F7> 4.61%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ 212,072 0.41%<F7> 2.01%<F7> 7.48%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ 315,759 0.38%<F7> 1.66%<F7> 9.81%
-------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ 452,752 0.33%<F7> 1.43%<F7> 2.91%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 568,161 0.36%<F7> 1.17%<F7> 13.95%
---------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ 665,835 0.37%<F7> 1.10%<F7> 2.80%<F2>
---------------------------------------------------------------------------------------------------------------------
GROWTH
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F9> .................... 134,428 0.90%<F8> 0.13%<F8> 49.84%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ 155,293 0.90%<F8> (0.04)%<F8> 56.75%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ 181,650 0.89%<F8> 0.09%<F8> 62.09%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ 197,798 0.89%<F8> 0.20%<F8> 51.82%
---------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 306,832 0.94%<F8> (0.06)%<F8> 59.35%
---------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (Unaudited) ........ 321,879 0.94%<F8> (0.06)%<F8> 65.02%<F2>
---------------------------------------------------------------------------------------------------------------------
</TABLE>
<F8> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 0.95%, 0.95%, 0.96%, 0.96%,
0.98%, 1.02%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been (0.07)%,
(0.07)%, 0.13%, 0.01%, (0.12)%, 0.01%, respectively.
<F9> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of the
close of business on January 9, 1995, and the results thereof combined with
the results of operations and distributions for each applicable class for
the period January 10, 1995 through October 31, 1995.
<F10>Net investment income per share represents net investment income divided by
the average shares outstanding throughout the period.
<F11>Net investment income (loss) per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
<F12>Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements. 35
<PAGE>
FINANCIAL HIGHLIGHTS
INSTITUTIONAL
EQUITY FUNDS
PER SHARE DATA
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------------------------------
NET NET REALIZED AND
ASSET VALUE, NET UNREALIZED GAINS TOTAL FROM
BEGINNING INVESTMENT OR (LOSSES) ON INVESTMENT
OF PERIOD INCOME (LOSS) SECURITIES OPERATIONS
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MIDCAP INDEX
------------------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) .................. $ 10.00 $ 0.05 $ 1.65 $ 1.70
------------------------------------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F11> ..................................... 33.19 0.00 8.49 8.49
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .......................................... 41.47 (0.04)<F13> 4.74 4.70
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .......................................... 41.58 (0.11)<F13> 8.49 8.38
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .......................................... 44.70 (0.14)<F12> (2.09) (2.23)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .......................................... 38.01 0.02<F13> 0.60 0.62
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .......................... 38.32 (0.04) 11.66 11.62
------------------------------------------------------------------------------------------------------------------------------------
EMERGING GROWTH
------------------------------------------------------------------------------------------------------------------------------------
Aug. 15, 1997<F1> through Oct. 31, 1997 .............................. 10.00 0.02 0.29 0.31
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .......................................... 10.31 0.05<F12> (0.71) (0.66)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .......................................... 9.58 (0.01) (0.24) (0.25)
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .......................... 9.32 (0.02) 3.48 3.46
------------------------------------------------------------------------------------------------------------------------------------
MICROCAP
------------------------------------------------------------------------------------------------------------------------------------
Aug. 1, 1995<F1> through June 30, 1996 ............................... 10.00 (0.02) 6.14 6.12
------------------------------------------------------------------------------------------------------------------------------------
July 1, 1996 through Oct. 31, 1996 ................................... 15.45 (0.07) 0.82 0.75
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .......................................... 16.20 (0.15) 4.27 4.12
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .......................................... 17.57 (0.22) (3.19) (3.41)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .......................................... 12.49 (0.19)<F13> 9.79 9.60
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .......................... 22.06 (0.19) 15.06 14.87
------------------------------------------------------------------------------------------------------------------------------------
CORE INTERNATIONAL EQUITY
------------------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) .................. 10.00 0.04<F12> (0.08) (0.04)
------------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F10>
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F11> ..................................... 19.99 0.12 (0.87) (0.75)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .......................................... 19.19 0.11<F13> 1.44 1.55
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .......................................... 20.27 0.10<F13> (1.10) (1.00)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .......................................... 18.64 0.24<F12> (3.16) (2.92)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .......................................... 15.26 0.09 3.62 3.71
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .......................... 18.66 (0.03) (0.22) (0.25)
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, the ratio of net expenses to average net assets for
the period ended April 30, 2000 would have been 0.69%; and the ratio of
net investment income to average net assets for the period ended April 30,
2000 would have been 0.91%.
<F5> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 0.97%, 0.96%, 0.95%, 0.95%,
0.95%, 0.98%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been (0.29)%,
0.02%, (0.39)%, (0.32)%, (0.17)%, (0.08)%, respectively.
<F6> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998 and for the period ended October 31, 1997 would have been 1.04%,
1.07%, 1.17%, 1.24%, respectively; and ratios of net investment income to
average net assets for the period ended April 30, 2000 and for the fiscal
years ended October 31, 1999, 1998 and for the period ended October 31,
1997 would have been (0.42)%, (0.12)%, 0.22%, 0.84%, respectively.
<F7> Without fees waived, the ratio of net expenses to average net assets for
the period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997 and for the periods ended October 31, 1996 and June 30,
1996 would have been 1.69%, 1.77%, 1.81%, 1.78%, 1.79%, 1.97%,
respectively, and the ratio of net investment income (loss) to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997 and for the periods ended October 31, 1996
and June 30, 1996 would have been (1.25)%, (1.19)%, 1.45%, (1.28)%,
(1.51)%, (0.39)%, respectively.
36 See notes to the financial statements.
<PAGE>
<TABLE>
<CAPTION>
LESS DISTRIBUTIONS
--------------------------------------------
DIVIDENDS
FROM NET DISTRIBUTIONS NET ASSET
INVESTMENT FROM TOTAL VALUE, END TOTAL
INCOME CAPITAL GAINS DISTRIBUTIONS OF PERIOD RETURN
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MIDCAP INDEX
-----------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) $ (0.05) $ -- $ (0.05) $ 11.65 16.97%<F2>
-----------------------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F11> ............... -- (0.21) (0.21) 41.47 25.79%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .................... -- (4.59) (4.59) 41.58 12.58%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... -- (5.26) (5.26) 44.70 22.44%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... -- (4.46) (4.46) 38.01 (5.66)%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... -- (0.31) (0.31) 38.32 1.56%
-----------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... -- (0.79) (0.79) 49.15 30.63%<F2>
-----------------------------------------------------------------------------------------------------------------------
EMERGING GROWTH
-----------------------------------------------------------------------------------------------------------------------
Aug. 15, 1997<F1> through Oct. 31, 1997 ........ -- -- -- 10.31 3.10%<F2>
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... (0.02) (0.05) (0.07) 9.58 (6.35)%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... (0.01) -- (0.01) 9.32 (2.57)%
-----------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... -- -- -- 12.78 37.12%<F2>
-----------------------------------------------------------------------------------------------------------------------
MICROCAP
-----------------------------------------------------------------------------------------------------------------------
Aug. 1, 1995<F1> through June 30, 1996 ......... (0.05) (0.62) (0.67) 15.45 63.93%<F2>
-----------------------------------------------------------------------------------------------------------------------
July 1, 1996 through Oct. 31, 1996 ............. -- -- -- 16.20 4.85%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... -- (2.75) (2.75) 17.57 30.12%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... -- (1.67) (1.67) 12.49 (21.51)%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... -- (0.03) (0.03) 22.06 77.06%
-----------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... -- (6.13) (6.13) 30.80 81.81%<F2>
-----------------------------------------------------------------------------------------------------------------------
CORE INTERNATIONAL EQUITY
-----------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) (0.01) -- (0.01) 9.95 (0.38)%<F2>
-----------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F10>
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F11> ............... (0.04) (0.01) (0.05) 19.19 (3.75)%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .................... (0.10) (0.37) (0.47) 20.27 8.21%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... (0.17) (0.46) (0.63) 18.64 (5.10)%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... (0.09) (0.37) (0.46) 15.26 (15.97)%
-----------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... (0.31) -- (0.31) 18.66 24.74%
-----------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... (0.06) -- (0.06) 18.35 (1.37)%<F2>
-----------------------------------------------------------------------------------------------------------------------
<CAPTION>
SUPPLEMENTAL DATA AND RATIOS
--------------------------------------------------
RATIO OF NET
NET ASSETS, RATIO OF NET INVESTMENT
END OF EXPENSES INCOME (LOSS) PORTFOLIO
PERIOD TO AVERAGE TO AVERAGE TURNOVER
(000S) NET ASSETS NET ASSETS RATE<F14>
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MIDCAP INDEX
----------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) $ 102,815 0.50% 4 1.10% 4 23.17% 2
----------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F11> ............... 434,228 0.90% 5 0.00% 5 79.25%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .................... 482,857 0.88% 5 (0.10)% 5 103.34%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... 569,028 0.87% 5 (0.25)% 5 97.40%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... 464,858 0.88% 5 (0.32)% 5 77.39%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... 359,947 0.94% 5 0.04% 5 139.91%
----------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... 395,603 0.95% 5 (0.27)% 5 177.11% 2
----------------------------------------------------------------------------------------------------------
EMERGING GROWTH
----------------------------------------------------------------------------------------------------------
Aug. 15, 1997<F1> through Oct. 31, 1997 ......... 48,044 0.90% 3,6 1.18% 3,6 14.51% 2
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... 60,400 0.90% 6 0.49% 6 132.63%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... 139,279 1.05% 6 (0.10)% 6 115.65%
----------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... 184,496 1.04% 6 (0.42)% 6 119.98% 2
----------------------------------------------------------------------------------------------------------
MICROCAP
----------------------------------------------------------------------------------------------------------
Aug. 1, 1995<F1> through June 30, 1996 ......... 63,595 1.74% 3,7 (0.16)% 3,7 283.67% 2
----------------------------------------------------------------------------------------------------------
July 1, 1996 through Oct. 31, 1996 ............. 66,368 1.72% 3,7 (1.44)% 3,7 64.44%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... 103,840 1.70% 7 (1.20)% 7 158.39%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... 72,696 1.74% 7 (1.38)% 7 135.61%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... 150,898 1.76% 7 (1.18)% 7 200.09%
----------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... 282,900 1.69% 7 (1.25)% 7 231.39% 2
----------------------------------------------------------------------------------------------------------
CORE INTERNATIONAL EQUITY
----------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) 39,613 1.45% 8 0.74% 8 17.29% 2
----------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F10>
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F11> ............... 31,187 1.50% 9 0.66% 9 15.12%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .................... 43,182 1.50% 9 0.62% 9 31.57%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... 57,206 1.50% 9 0.50% 9 97.09%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... 44,670 1.50% 9 1.37% 9 43.96%
----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... 54,423 1.56% 9 0.80% 9 45.50%
----------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... 54,391 1.57% 9 (0.28)% 9 51.16% 2
----------------------------------------------------------------------------------------------------------
</TABLE>
<F8> Without fees waived, the ratio of net expenses to average net assets for
the period ended April 30, 2000 would have been 2.00%; and the ratio of
net investment income to average net assets for the period ended April 30,
2000 would have been 0.19%.
<F9> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 1.79%, 1.85%, 1.92%, 2.25%,
2.36%, 2.65%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been (0.50)%,
0.51%, 0.96%, (0.25)%, (0.24)%, (0.49)%, respectively.
<F10>Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisers.
<F11>On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994 through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of
the close of business on January 9, 1995, and the results thereof combined
with the results of operations and distributions for each applicable class
for the period January 10, 1995 through October 31, 1995.
<F12>Net investment income (loss) per share represents net investment income
divided by the average shares outstanding throughout the period.
<F13>Net investment income (loss) per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
<F14>Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements. 37
<PAGE>
FINANCIAL HIGHLIGHTS
RETAIL A SHARE
EQUITY FUNDS
PER SHARE DATA
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
--------------------------------------------
NET NET REALIZED AND
ASSET VALUE, NET UNREALIZED GAINS TOTAL FROM
BEGINNING INVESTMENT OR (LOSSES) ON INVESTMENT
OF PERIOD INCOME (LOSS) SECURITIES OPERATIONS
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
BALANCED INCOME
------------------------------------------------------------------------------------------------------------------------------------
Dec. 1, 1997<F1> through Oct. 31, 1998 ................................. $ 10.00 $ 0.28<F11> $ 0.96 $ 1.24
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 11.00 0.28 0.38 0.66
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ............................ 10.94 0.13<F10> 0.21 0.34
------------------------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ....................................... 22.10 0.49 3.77 4.26
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ............................................ 25.89 0.47<F12> 2.64 3.11
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ............................................ 27.98 0.58 4.19 4.77
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ............................................ 30.48 0.56 1.86 2.42
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 29.82 0.49 1.19 1.68
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ............................ 30.06 0.26 4.21 4.47
------------------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ....................................... 23.09 0.37 5.14 5.51
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ............................................ 27.62 0.42<F12> 6.61 7.03
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ............................................ 33.07 0.37 8.92 9.29
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ............................................ 39.24 0.36 6.55 6.91
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 44.41 0.29 4.92 5.21
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ............................ 46.08 0.07 2.70 2.77
------------------------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ....................................... 33.41 0.70 7.70 8.40
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ............................................ 41.07 0.77<F12> 8.69 9.46
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ............................................ 49.40 0.80<F11> 14.33 15.13
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ............................................ 63.11 0.84 12.58 13.42
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 74.58 0.80 17.75 18.55
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ............................ 91.83 0.40<F10> 5.72 6.12
------------------------------------------------------------------------------------------------------------------------------------
GROWTH
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ....................................... 21.47 (0.02) 4.16 4.14
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ............................................ 25.58 (0.07)<F12> 4.81 4.74
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ............................................ 30.32 (0.05)<F12> 6.30 6.25
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ............................................ 35.27 (0.02)<F11> 5.66 5.64
------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ............................................ 35.72 (0.12)<F11> 6.42 6.30
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ............................ 37.96 (0.07) 7.08 7.01
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000, the fiscal year ended October 31, 1999 and
the period ended October 31, 1998 would have been 1.37%, 1.48%, 1.63%,
respectively; and ratio of net investment income to average net assets for
the period ended April 30, 2000, the fiscal year ended October 31, 1999 and
the period ended October 31, 1998 would have been 2.35%, 2.29%, 2.19%,
respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 1.27%, 1.25%, 1.24%, 1.25%,
1.28%, 1.25%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 1.57%,
1.52%, 1.67%, 1.80%, 1.52%, 1.74%, respectively.
<F6> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 1.19%, 1.18%, 1.19%, 1.19%,
1.23%, 1.20%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 0.33%,
0.73%, 0.79%, 1.02%, 1.35%, 1.40%, respectively.
<F7> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 0.68%, 0.68%, 0.69%, 0.70%,
0.73%, 0.73%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 0.79%,
0.85%, 1.07%, 1.33%, 1.69%, 2.07%, respectively.
38 See notes to the financial statements.
<PAGE>
<TABLE>
<CAPTION>
LESS DISTRIBUTIONS
------------------------------------------
DIVIDENDS DISTRIBUTIONS
FROM NET FROM NET ASSET
INVESTMENT CAPITAL TOTAL VALUE, END TOTAL
INCOME GAINS DISTRIBUTIONS OF PERIOD RETURN<F9>
--------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCED INCOME
--------------------------------------------------------------------------------------------------------------------------
Dec. 1, 1997<F1> through Oct. 31, 1998 ............. $ (0.24) $ -- $ (0.24) $ 11.00 12.46%<F2>
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (0.28) (0.44) (0.72) 10.94 6.01%
--------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ (0.12) (0.20) (0.32) 10.96 3.20%<F2>
--------------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ................... (0.47) -- (0.47) 25.89 19.55%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ (0.47) (0.55) (1.02) 27.98 12.30%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ (0.59) (1.68) (2.27) 30.48 18.07%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ (0.58) (2.50) (3.08) 29.82 8.60%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (0.49) (0.95) (1.44) 30.06 5.56%
--------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ (0.26) (1.67) (1.93) 32.60 15.29%<F2>
--------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ................... (0.38) (0.60) (0.98) 27.62 24.75%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ (0.39) (1.19) (1.58) 33.07 26.62%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ (0.39) (2.73) (3.12) 39.24 30.47%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ (0.35) (1.39) (1.74) 44.41 18.08%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (0.35) (3.21) (3.56) 46.06 11.78%
--------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ (0.05) (3.90) (3.95) 44.90 6.43%<F2>
--------------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ................... (0.68) (0.06) (0.74) 41.07 25.79%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ (0.78) (0.35) (1.13) 49.40 23.36%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ (0.81) (0.61) (1.42) 63.11 31.08%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ (0.84) (1.11) (1.95) 74.58 21.63%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (0.83) (0.47) (1.30) 91.83 25.01%
--------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ (0.39) (2.08) (2.47) 95.48 6.64%<F2>
--------------------------------------------------------------------------------------------------------------------------
GROWTH
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ................... (0.03) -- (0.03) 25.58 19.31%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ -- -- -- 30.32 18.53%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ -- (1.30) (1.30) 35.27 21.30%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ (0.02) (5.17) (5.19) 35.72 18.58%
--------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ (0.02) (4.04) (4.06) 37.96 17.92%
--------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ -- (2.03) (2.03) 42.94 18.84%<F2>
--------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SUPPLEMENTAL DATA AND RATIOS
---------------------------------------------------
RATIO OF NET
NET ASSETS, RATIO OF NET INVESTMENT
END OF EXPENSES INCOME (LOSS) PORTFOLIO
PERIOD TO AVERAGE TO AVERAGE TURNOVER
(000S) NET ASSETS NET ASSETS RATE 13
-----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
BALANCED INCOME
-----------------------------------------------------------------------------------------------------------
Dec. 1, 1997<F1> through Oct. 31, 1998 ............. $ 10,614 1.00%<F3><F4> 2.82%<F3><F4> 58.33%<F2>
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 13,087 1.18%<F4> 2.59%<F4> 48.46%
-----------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ 11,413 1.22%<F4> 2.50%<F4> 93.42%<F2>
-----------------------------------------------------------------------------------------------------------
BALANCED GROWTH
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ................... 21,832 0.94%<F5> 2.05%<F5> 61.87%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ 29,034 1.00%<F5> 1.80%<F5> 63.91%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ 44,026 1.00%<F5> 2.06%<F5> 69.90%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ 59,657 1.00%<F5> 1.91%<F5> 56.44%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 53,807 1.18%<F5> 1.59%<F5> 69.42%
-----------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ 53,470 1.22%<F5> 1.62%<F5> 81.13%<F2>
-----------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ................... 42,424 1.09%<F6> 1.51%<F6> 47.85%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ 71,310 1.15%<F6> 1.42%<F6> 51.37%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ 128,070 1.12%<F6> 1.09%<F6> 31.36%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ 190,331 1.12%<F6> 0.86%<F6> 48.56%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 194,089 1.17%<F6> 0.74%<F6> 62.20%
-----------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ 181,142 1.19%<F6> 0.33% 91.87%<F2>
-----------------------------------------------------------------------------------------------------------
EQUITY INDEX
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ................... 18,663 0.66%<F7> 2.14%<F7> 4.61%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ 39,656 0.66%<F7> 1.76%<F7> 7.48%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ 76,866 0.63%<F7> 1.40%<F7> 9.81%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ 110,129 0.58%<F7> 1.18%<F7> 2.91%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 142,247 0.61%<F7> 0.92%<F7> 13.95%
-----------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ 146,680 0.62%<F7> 0.85%<F7> 2.80%<F2>
-----------------------------------------------------------------------------------------------------------
GROWTH
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F10> ................... 10,105 1.09%<F8> (0.06)%<F8> 49.84%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................ 16,636 1.15%<F8> (0.29)%<F8> 56.75%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................ 25,043 1.14%<F8> (0.16)%<F8> 62.09%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................ 38,213 1.14%<F8> (0.05)%<F8> 51.82%
-----------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................ 47,238 1.19%<F8> (0.31)%<F8> 59.35%
-----------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........ 51,718 1.19%<F8> (0.31)%<F8> 65.02%<F2>
-----------------------------------------------------------------------------------------------------------
</TABLE>
<F8> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 1.20%, 1.20%, 1.21%, 1.21%,
1.23%, 1.21%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been (0.32)%,
(0.32)%, (0.12)%, (0.24)%, (0.36)%, (0.18)%, respectively.
<F9> The total return calculation does not reflect the maximum sales charge of
5.50%.
<F10>On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994 through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of
the close of business on January 9, 1995, and the results thereof
combined with the results of operations and distributions for each
applicable class for the period January 10, 1995 through October 31, 1995.
<F11>Net investment income (loss) per share represents net investment income
divided by the average shares outstanding throughout the period.
<F12>Net investment income (loss) per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
<F13>Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements. 39
<PAGE>
FINANCIAL HIGHLIGHTS
RETAIL A SHARE
EQUITY FUNDS
PER SHARE DATA
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
--------------------------------------------
NET NET REALIZED AND
ASSET VALUE, NET UNREALIZED GAINS TOTAL FROM
BEGINNING INVESTMENT OR (LOSSES) ON INVESTMENT
OF PERIOD INCOME (LOSS) SECURITIES OPERATIONS
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MIDCAP INDEX
-----------------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) ................... $ 10.00 $ 0.04 $ 1.65 $ 1.69
-----------------------------------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F12> ...................................... 33.19 (0.07) 8.49 8.42
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................................... 41.40 (0.13)<F14> 4.70 4.57
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................................... 41.38 (0.20)<F14> 8.44 8.24
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................................... 44.36 (0.24)<F13> (2.07) (2.31)
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................................... 37.59 (0.08)<F13> 0.60 0.52
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 37.80 (0.22) 11.63 11.41
-----------------------------------------------------------------------------------------------------------------------------------
EMERGING GROWTH
-----------------------------------------------------------------------------------------------------------------------------------
Aug. 15, 1997<F1> through Oct. 31, 1997 ............................... 10.00 0.02 0.29 0.31
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................................... 10.31 0.03<F13> (0.71) (0.68)
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................................... 9.56 (0.02) (0.24) (0.26)
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 9.29 (0.05) 3.48 3.43
-----------------------------------------------------------------------------------------------------------------------------------
MICROCAP
-----------------------------------------------------------------------------------------------------------------------------------
Aug. 1, 1995<F1> through June 30, 1996 ................................ 10.00 (0.02) 6.10 6.08
-----------------------------------------------------------------------------------------------------------------------------------
July 1, 1996 through Oct. 31, 1996 .................................... 15.42 (0.08)<F14> 0.82 0.74
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................................... 16.16 (0.18)<F14> 4.24 4.06
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................................... 17.47 (0.25)<F13> (3.17) (3.42)
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................................... 12.38 (0.26)<F14> 9.71 9.45
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 21.80 (0.19) 14.80 14.61
-----------------------------------------------------------------------------------------------------------------------------------
CORE INTERNATIONAL EQUITY
-----------------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) ................... 10.00 0.02 (0.08) (0.06)
-----------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY10
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F12> ...................................... 19.99 0.08 (0.87) (0.79)
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 ........................................... 19.15 0.07<F14> 1.43 1.50
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 ........................................... 20.21 0.06<F14> (1.10) (1.04)
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 ........................................... 18.58 0.20<F13> (3.15) (2.95)
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 ........................................... 15.18 0.03 3.62 3.65
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 18.53 (0.05)<F13> (0.23) (0.28)
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, the ratio of net expenses to average net assets for
the period ended April 30, 2000 would have been 0.94%; and the ratio of
net investment income to average net assets for the period ended April 30,
2000 would have been 0.58%.
<F5> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 1.22%, 1.21%, 1.20%, 1.20%,
1.20%, 1.17%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been (0.54)%,
(0.23)%, (0.64)%, (0.57)%, (0.42)%, (0.27)%, respectively.
<F6> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998 and the period ended October 31, 1997 would have been 1.29%,
1.32%, 1.42%, 1.59%, respectively; and ratios of net investment income to
average net assets for the period ended April 30, 2000 and for the fiscal
years ended October 31, 1999, 1998 and the period ended October 31, 1997
would have been (0.67)%, (0.37)%, (0.03)%, 0.59%, respectively.
<F7> Without fees waived, the ratio of net expenses to average net assets for
the period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996 and the period ended June 30, 1996 would have been
1.94%, 2.02%, 2.06%, 2.03%, 2.04%, 2.22%, respectively, and the ratio of
net investment income (loss) to average net assets for the period ended
April 30, 2000 and for the fiscal years ended October 31, 1999, 1998, 1997,
1996 and the period ended June 30, 1996 would have been (0.52)%, (1.44)%,
(1.70)%, (1.53)%, (1.76)%, (0.59)%, respectively.
40 See notes to the financial statements.
<PAGE>
<TABLE>
<CAPTION>
LESS DISTRIBUTIONS
------------------------------------------
DIVIDENDS DISTRIBUTIONS
FROM NET FROM NET ASSET
INVESTMENT CAPITAL TOTAL VALUE, END TOTAL
INCOME GAINS DISTRIBUTIONS OF PERIOD RETURN<F11>
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MIDCAP INDEX
------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) $ (0.04) $ -- $ (0.04) $ 11.65 16.88%<F2>
------------------------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F12> ............... -- (0.21) (0.21) 41.40 25.56%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .................... -- (4.59) (4.59) 41.38 12.27%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... -- (5.26) (5.26) 44.36 22.18%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... -- (4.46) (4.46) 37.59 (5.91)%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... -- (0.31) (0.31) 37.80 1.31%
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... -- (0.79) (0.79) 48.42 30.50%<F2>
------------------------------------------------------------------------------------------------------------------------
EMERGING GROWTH
------------------------------------------------------------------------------------------------------------------------
Aug. 15, 1997<F1> through Oct. 31, 1997 ........ -- -- -- 10.31 3.10%<F2>
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... (0.02) (0.05) (0.07) 9.56 (6.58)%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... (0.01) -- (0.01) 9.29 (2.72)%
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... -- -- -- 12.72 36.92%<F2>
------------------------------------------------------------------------------------------------------------------------
MICROCAP
------------------------------------------------------------------------------------------------------------------------
Aug. 1, 1995<F1> through June 30, 1996 ......... (0.04) (0.62) (0.66) 15.42 63.52%<F2>
------------------------------------------------------------------------------------------------------------------------
July 1, 1996 through Oct. 31, 1996 ............. -- -- -- 16.16 4.80%<F2>
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... -- (2.75) (2.75) 17.47 29.78%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... -- (1.67) (1.67) 12.38 (21.71)%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... -- (0.03) (0.03) 21.80 76.54%
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... -- (6.13) (6.13) 30.28 81.55%<F2>
------------------------------------------------------------------------------------------------------------------------
CORE INTERNATIONAL EQUITY
------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) (0.01) -- (0.01) 9.93 (0.61)%<F2>
------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F10>
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F12> ............... (0.04) (0.01) (0.05) 19.15 (3.95)%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .................... (0.07) (0.37) (0.44) 20.21 7.95%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... (0.13) (0.46) (0.59) 18.58 (5.30)%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... (0.08) (0.37) (0.45) 15.18 (16.16)%
------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... (0.30) -- (0.30) 18.53 24.48%
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... (0.01) -- (0.01) 18.23 (1.56)%<F2>
------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SUPPLEMENTAL DATA AND RATIOS
-------------------------------------------------------
RATIO OF NET
NET ASSETS, RATIO OF NET INVESTMENT
END OF EXPENSES INCOME (LOSS) PORTFOLIO
PERIOD TO AVERAGE TO AVERAGE TURNOVER
(000S) NET ASSETS NET ASSETS RATE<F15>
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MIDCAP INDEX
---------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) $ 1,391 0.75%<F4> 0.77%<F4> 23.17%<F2>
---------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F12> ............... 87,269 1.09%<F5> (0.19)%<F5> 79.25%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .................... 111,159 1.13%<F5> (0.35)%<F5> 103.34%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... 147,396 1.12%<F5> (0.50)%<F5> 97.40%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... 136,146 1.13%<F5> (0.57)%<F5> 77.39%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... 95,758 1.19%<F5> (0.21)%<F5> 139.91%
---------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... 100,515 1.20%<F5> (0.52)%<F5> 177.11%<F2>
---------------------------------------------------------------------------------------------------------
EMERGING GROWTH
---------------------------------------------------------------------------------------------------------
Aug. 15, 1997<F1> through Oct. 31, 1997 ........ 5,355 1.15%<F3><F6> 0.93%<F3><F6> 14.51%<F2>
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... 12,884 1.15%<F6> 0.24%<F6> 132.63%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... 9,957 1.30%<F6> (0.35)%<F6> 115.65%
---------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... 11,155 1.29%<F6> (0.67)%<F6> 119.98%<F2>
---------------------------------------------------------------------------------------------------------
MICROCAP
---------------------------------------------------------------------------------------------------------
Aug. 1, 1995<F1> through June 30, 1996 ......... 9,036 1.99%<F3><F7> (0.36)%<F3><F7> 283.67%<F2>
---------------------------------------------------------------------------------------------------------
July 1, 1996 through Oct. 31, 1996 ............. 9,273 1.97%<F3><F7> (1.69)%<F3><F7> 64.44%<F2>
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... 16,793 1.95%<F7> (1.45)%<F7> 158.39%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... 12,419 1.99%<F7> (1.63)%<F7> 135.61%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... 21,988 2.01%<F7> (1.43)%<F7> 200.09%
---------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... 40,097 1.94%<F7> (0.52)%<F7> 231.39%<F2>
---------------------------------------------------------------------------------------------------------
CORE INTERNATIONAL EQUITY
---------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) 30 1.70%<F8> 0.65%<F8> 17.29%<F2>
---------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F10>
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F12> ............... 1,633 1.70%<F9> 0.46%<F9> 15.12%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 .................... 3,769 1.75%<F9> 0.37%<F9> 31.57%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 .................... 6,502 1.75%<F9> 0.25%<F9> 97.09%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 .................... 6,486 1.75%<F9> 1.12%<F9> 43.96%
---------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 .................... 6,418 1.81%<F9> 0.56%<F9> 45.50%
---------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) .... 5,963 1.82%<F9> (0.52)%<F9> 51.16%<F2>
---------------------------------------------------------------------------------------------------------
</TABLE>
<F8> Without fees waived, the ratio of net expenses to average net assets for
the period ended April 30, 2000 would have been 2.25%; and the ratio of
net investment income to average net assets for the period ended April 30,
2000 would have been 0.10%.
<F9> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 2.04%, 2.10%, 2.16%, 2.50%,
2.61%, 2.85%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been (0.74)%,
(0.27)%, 0.71%, (0.50)%, (0.48)%, (0.69)%, respectively.
<F10>Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisors.
<F11>The total return calculation does not reflect the maximum sales charge of
5.50%.
<F12>On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994 through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of
the close of business on January 9, 1995, and the results thereof combined
with the results of operations and distributions for each applicable
class for the period January 10, 1995 through October 31, 1995.
<F13>Net investment income (loss) per share represents net investment income
divided by the average shares outstanding throughout the period.
<F14>Net investment income (loss) per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
<F15>Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements. 41
<PAGE>
FINANCIAL HIGHLIGHTS
RETAIL B SHARE
EQUITY FUNDS
PER SHARE DATA
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
--------------------------------------------
NET NET REALIZED AND
ASSET VALUE, NET UNREALIZED GAINS TOTAL FROM
BEGINNING INVESTMENT OR (LOSSES) ON INVESTMENT
OF PERIOD INCOME (LOSS) SECURITIES OPERATIONS
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
BALANCED INCOME
-----------------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ............................ $ 10.87 $ 0.14<F15> $ 0.07 $ 0.21
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 10.96 0.10<F15> 0.21 0.31
-----------------------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
-----------------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ............................ 30.25 0.17<F15> (0.10) 0.07
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 30.15 0.16 4.21 4.37
-----------------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
-----------------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ............................ 44.64 0.02<F15> 1.40 1.42
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 46.06 (0.06) 2.65 2.59
-----------------------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
-----------------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ............................ 83.72 0.08<F15> 8.18 8.26
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 91.72 0.05<F15> 5.72 5.77
-----------------------------------------------------------------------------------------------------------------------------------
GROWTH
-----------------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ............................ 36.92 (0.29)<F15> 1.15 0.86
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 37.78 (0.14) 6.96 6.82
-----------------------------------------------------------------------------------------------------------------------------------
MIDCAP INDEX
-----------------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999 through April 30, 2000 (unaudited) ....................... 10.00 0.02 1.64 1.66
-----------------------------------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
-----------------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ............................ 37.57 (0.23)<F15> 0.29 0.06
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 37.63 (0.28)<F15> 11.46 11.18
-----------------------------------------------------------------------------------------------------------------------------------
EMERGING GROWTH
-----------------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ............................ 9.57 (0.07)<F15> (0.25) (0.32)
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 9.25 (0.08)<F15> 3.45 3.37
-----------------------------------------------------------------------------------------------------------------------------------
MICROCAP
-----------------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ............................ 13.74 (0.30)<F15> 8.25 7.95
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 21.69 (0.34) 14.76 14.42
-----------------------------------------------------------------------------------------------------------------------------------
CORE INTERNATIONAL EQUITY
-----------------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) ................... 10.00 0.01 (0.08) (0.07)
-----------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F12>
-----------------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ............................ 14.71 (0.10)<F15> 3.76 3.66
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ........................... 18.37 (0.09)<F15> (0.27) (0.36)
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, ratio of net expenses to average net assets for the
periods ended April 30, 2000 and October 31, 1999 would have been 2.12%,
2.21%, respectively; and the ratio of net investment income to average net
assets for the periods ended April 30, 2000 and October 31, 1999 would have
been 1.64%, 1.66%, respectively.
<F5> Without fees waived, ratio of net expenses to average net assets for the
periods ended April 30, 2000 and October 31, 1999 would have been 2.02%,
2.03%, respectively; and the ratio of net investment income to average net
assets for the periods ended April 30, 2000 and October 31, 1999 would have
been 0.85%, 0.81%, respectively.
<F6> Without fees waived, ratio of net expenses to average net assets for the
periods ended April 30, 2000 and October 31, 1999 would have been 1.43%,
1.43%, respectively; and the ratio of net investment income to average net
assets for the periods ended April 30, 2000 and October 31, 1999 would have
been 0.04%, 0.07%, respectively.
<F7> Without fees waived, ratio of net expenses to average net assets for the
periods ended April 30, 2000 and October 31, 1999 would have been 1.95%,
1.97%, respectively; and the ratio of net investment income to average net
assets for the periods ended April 30, 2000 and October 31, 1999 would have
been (1.07)%, (1.18)%.
42 See notes to the financial statements.
<PAGE>
<TABLE>
<CAPTION>
LESS DISTRIBUTIONS
-----------------------------------------
DIVIDENDS DISTRIBUTIONS
FROM NET FROM NET ASSET
INVESTMENT CAPITAL TOTAL VALUE, END TOTAL
INCOME GAINS DISTRIBUTIONS OF PERIOD RETURN
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCED INCOME
------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... $ (0.12) $ -- $ (0.12) $ 10.96 1.97%<F2>
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... (0.09) (0.20) (0.29) 10.98 2.92%<F2>
------------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... (0.17) -- (0.17) 30.15 0.25%<F2>
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... (0.16) (1.67) (1.83) 32.69 14.89%<F2>
------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... (0.03) -- (0.03) 46.03 3.19%<F2>
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... -- (3.90) (3.90) 44.75 6.00%<F2>
------------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... (0.26) -- (0.26) 91.72 9.88%<F2>
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... (0.10) (2.08) (2.18) 95.31 6.27%<F2>
------------------------------------------------------------------------------------------------------------------------
GROWTH
------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... -- -- -- 37.78 2.33%<F2>
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... -- (2.03) (2.03) 42.57 18.42%<F2>
------------------------------------------------------------------------------------------------------------------------
MIDCAP INDEX
------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999 through April 30, 2000 (unaudited) .. (0.03) -- (0.03) 11.63 16.56%<F2>
------------------------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... -- -- -- 37.63 0.16%<F2>
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... -- (0.79) (0.79) 48.02 30.02%<F2>
------------------------------------------------------------------------------------------------------------------------
EMERGING GROWTH
------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... -- -- -- 9.25 (3.34)%<F2>
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... -- -- -- 12.62 36.43%<F2>
------------------------------------------------------------------------------------------------------------------------
MICROCAP
------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... -- -- -- 21.69 57.86%<F2>
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... -- (6.13) (6.13) 29.98 80.94%<F2>
------------------------------------------------------------------------------------------------------------------------
CORE INTERNATIONAL EQUITY
------------------------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) (0.01) -- (0.01) 9.92 (0.71)%<F2>
------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F12>
------------------------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... -- -- -- 18.37 24.88%<F2>
------------------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... -- -- -- 18.01 (1.85)%<F2>
------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SUPPLEMENTAL DATA AND RATIOS
--------------------------------------------------
RATIO OF NET
NET ASSETS, RATIO OF NET INVESTMENT
END OF EXPENSES INCOME (LOSS) PORTFOLIO
PERIOD TO AVERAGE TO AVERAGE TURNOVER
(000S) NET ASSETS<F3> NET ASSETS<F3> RATE<F2><F13>
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
BALANCED INCOME
-------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... $ 1,571 1.97%<F4> 1.90%<F4> 48.46%
-------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... 3,582 1.97%<F4> 1.79%<F4> 93.42%
-------------------------------------------------------------------------------------------------------
BALANCED GROWTH
-------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... 630 1.97%<F5> 0.87%<F5> 69.42%
-------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... 1,264 1.97%<F5> 0.90%<F5> 81.13%
-------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
-------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... 1,550 1.94% 0.05% 62.20%
-------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... 2,461 1.97% (0.42)% 91.87%
-------------------------------------------------------------------------------------------------------
EQUITY INDEX
-------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... 4,613 1.37%<F6> 0.13%<F6> 13.95%
-------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... 9,132 1.37%<F6> 0.10%<F6> 2.80%
-------------------------------------------------------------------------------------------------------
GROWTH
-------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... 722 1.96%<F7> (1.17)%<F7> 59.35%
-------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... 1,144 1.94%<F7> (1.06)%<F7> 65.02%
-------------------------------------------------------------------------------------------------------
MIDCAP INDEX
-------------------------------------------------------------------------------------------------------
Nov. 4, 1999 through April 30, 2000 (unaudited) .. 295 1.50%<F8> (0.02)%<F8> 23.17%
-------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
-------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... 126 1.95%<F9> (0.89)%<F9> 139.91%
-------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... 248 1.95%<F9> (1.27)%<F9> 177.11%
-------------------------------------------------------------------------------------------------------
EMERGING GROWTH
-------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... 80 2.08% (1.17)% 115.65%
-------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... 222 2.04% (1.40)% 119.98%
-------------------------------------------------------------------------------------------------------
MICROCAP
-------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... 140 2.78% (2.36)% 200.09%
-------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... 845 2.69% (2.24)% 231.39%
-------------------------------------------------------------------------------------------------------
CORE INTERNATIONAL EQUITY
-------------------------------------------------------------------------------------------------------
Nov. 4, 1999<F1> through April 30, 2000 (unaudited) 45 2.45%<F10> 0.51%<F10> 17.29%
-------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F12>
-------------------------------------------------------------------------------------------------------
March 1, 1999<F1> through October 31, 1999 ....... 44 2.57%<F11> (0.85)%<F9> 45.50%
-------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 2000 (unaudited) ...... 302 2.57%<F11> (0.93)%<F11> 51.16%
-------------------------------------------------------------------------------------------------------
</TABLE>
<F8> Without fees waived, the ratio of net expenses to average net assets for
the period ended April 30, 2000 would have been 1.69%; and the ratio of
net investment income to average net assets for the period ended April 30,
2000 would have been (0.21)%.
<F9> Without fees waived, ratio of net expenses to average net assets for the
periods ended April 30, 2000 and October 31, 1999 would have been 1.97%,
1.97%, respectively; and the ratio of net investment income to average net
assets for the periods ended April 30, 2000 and October 31, 1999 would have
been (1.29)%, (0.91)%, respectively.
<F10>Without fees waived, the ratio of net expenses to average net assets for
the period ended April 30, 2000 would have been 3.00%; and the ratio of net
investment income to average net assets for the period ended April 30, 2000
would have been (0.04)%. 11 Without fees waived, ratio of net expenses to
average net assets for the periods ended April 30, 2000 and October 31,
1999 would have been 2.79%, 2.85%, respectively; and the ratio of net
investment income to average net assets for the periods ended April 30,
2000 and October 31, 1999 would have been (1.15)%, (1.13)%, respectively.
<F12>Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisors.
<F13>Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued. 14 The total
return calculation does not reflect the maximum deferred sales charge of
5.00%.
<F15>Net investment income per share represents net investment income divided by
the average shares outstanding throughout the period.
See notes to the financial statements. 43
<PAGE>
BALANCED INCOME FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMON STOCKS 49.8%
Auto & Truck Parts 0.1%
6,800 Delphi Automotive Systems Corporation $ 130
--------------
BANKING 3.8%
19,700 Bank of New York Company, Inc. 809
10,400 Chase Manhattan Corporation 749
16,800 Mellon Bank Corporation 540
15,400 Northern Trust Corporation 988
9,300 Wells Fargo Company, Inc. 382
--------------
3,468
--------------
BUILDING MATERIALS 0.6%
13,000 Vulcan Materials Company 570
--------------
BUSINESS MACHINES & SOFTWARE 1.3%
3,300 International Business Machines Corporation 368
7,675 Microsoft Corporation<F1> 535
3,300 Sun Microsystems, Inc.<F1> 303
--------------
1,206
--------------
BUSINESS SERVICES 2.9%
12,100 Automatic Data Processing, Inc. 651
3,900 Electronic Data Systems Corporation 268
11,400 First Data Corporation 555
20,100 Manpower, Inc. 710
17,300 Viad Corporation 439
--------------
2,623
--------------
CHEMICALS 2.1%
22,100 Ecolab, Inc. 863
14,500 Millipore Corporation 1,039
--------------
1,902
--------------
COMMUNICATIONS & MEDIA 3.2%
9,800 CBS Corporation<F1> 576
2,600 General Motors Corporation - Class H 250
7,300 Infinity Broadcasting Corporation<F1> 248
15,700 Interpublic Group of Companies, Inc. 644
13,075 New York Times Company - Class A 539
7,900 Time Warner, Inc. 711
--------------
2,968
--------------
computers 1.1%
5,100 Compaq Computer Corporation 149
6,800 Dell Computer Corporation<F1> 341
3,700 EMC Corporation<F1> 514
--------------
1,004
--------------
CONSUMER PRODUCTS 0.5%
6,250 Avery Dennison Corporation 410
1 Energizer Holdings, Inc.<F1> 0
--------------
410
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COSMETICS & SOAP 0.5%
5,400 Avon Products, Inc. $ 224
5,800 Estee Lauder Companies - Class A 256
--------------
480
--------------
DRUGS/MEDICAL SUPPLIES 5.5%
12,300 American Home Products Corporation 691
12,100 Bristol Myers Squibb Company 634
10,100 Eli Lilly & Company 781
1,100 Genentech, Inc.<F1> 129
9,200 Johnson & Johnson 759
10,300 Medtronic, Inc. 535
4,000 Merck & Company, Inc. 278
11,000 Warner-Lambert Company 1,252
--------------
5,059
--------------
ELECTRICAL EQUIPMENT 0.8%
4,900 General Electric Company 771
--------------
ELECTRONICS 0.6%
8,575 Molex, Inc. - Class A 343
5,200 Solectron Corporation<F1> 243
--------------
586
--------------
ELECTRIC UTILITIES 0.4%
2,100 Duke Power Company 121
5,300 The Montana Power Company 233
--------------
354
--------------
ENTERTAINMENT & LEISURE 0.2%
4,600 The Walt Disney Company 199
--------------
FINANCIAL SERVICES 4.6%
12,200 Alliance Capital Management L.P. 547
3,800 American Express Company 570
10,100 H&R Block, Inc. 422
16,200 Citigroup, Inc. 963
11,600 Franklin Resources, Inc. 374
8,000 Marsh & McLennan Companies, Inc. 789
7,100 Morgan Stanley Dean Witter & Company 545
--------------
4,210
--------------
FOOD, BEVERAGES & TOBACCO 1.6%
8,200 Anheuser-Busch Companies, Inc. 579
14,900 PepsiCo, Inc. 547
7,800 Sysco Corporation 293
--------------
1,419
--------------
HEALTH CARE SERVICES & SUPPLIES 0.3%
10,400 Columbia / HCA Healthcare Corporation 296
--------------
See notes to the financial statements.
44
<PAGE>
BALANCED INCOME FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
INSURANCE 0.5%
4,500 American International Group, Inc. $ 494
--------------
METALS & MINERALS 0.2%
2,800 Alcoa, Inc. 182
--------------
MULTI-INDUSTRY 1.4%
9,800 Pentair, Inc. 375
19,400 Tyco International, Ltd. 891
--------------
1,266
--------------
NATURAL GAS 1.1%
5,800 El Paso Energy Corporation 247
11,200 Enron Corporation 781
--------------
1,028
--------------
NETWORKING PRODUCTS 0.7%
9,400 Cisco Systems, Inc.<F1> 652
--------------
OIL - DOMESTIC 1.0%
10,200 Phillips Petroleum Company 484
20,000 USX Corporation - Marathon Group, Inc. 466
--------------
950
--------------
OIL - INTERNATIONAL 0.6%
7,088 Exxon Mobil Corporation 551
--------------
OIL - SERVICES & EQUIPMENT 1.3%
9,600 Nabors Industries, Inc.<F1> 379
9,350 Schlumberger Limited 716
1,600 Transocean Sedco Forex, Inc. 75
--------------
1,170
--------------
PAPER & FOREST PRODUCTS 0.6%
7,100 Kimberly-Clark Corporation 412
5,100 The Mead Corporation 178
--------------
590
--------------
printing & publishing 1.3%
9,550 Harcourt General, Inc. 357
2,700 Houghton Mifflin Company 112
14,000 McGraw-Hill, Inc. 735
--------------
1,204
--------------
REAL ESTATE INVESTMENT TRUSTS (REITS) 0.3%
13,075 AMB Property Corporation 288
--------------
RETAIL 2.0%
4,300 Costco Wholesale Corporation<F1> 232
12,635 Gap, Inc. 464
1,200 Kohl's Corporation<F1> 58
5,500 Lowe's Companies, Inc. 272
3,500 Target Corporation 233
19,100 Walgreen Company 537
--------------
1,796
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
SEMICONDUCTORS 2.1%
5,900 Intel Corporation $ 748
7,500 Texas Instruments, Inc. 1,222
--------------
1,970
--------------
TELECOMMUNICATIONS 3.3%
11,500 AT&T Corporation 537
7,400 ALLTEL Corporation 493
13,900 Bell Atlantic Corporation 824
9,900 Broadwing, Inc.<F1> 280
14,500 Sprint Corporation 892
--------------
3,026
--------------
TELECOMMUNICATIONS EQUIPMENT 2.4%
1,600 Corning, Inc. 316
2,800 Ericsson AB ADR 248
1,675 Motorola, Inc. 199
11,200 Nokia Corp. - ADR 637
7,300 Nortel Networks Corporation 827
--------------
2,227
--------------
TRANSPORTATION 0.9%
5,600 Expeditors International of Washington, Inc. 239
8,400 United Parcel Service, Inc. 559
--------------
798
--------------
Total Common Stocks (Cost $38,074) 45,844
--------------
PREFERRED STOCKS 1.8%
CHEMICALS 0.3%
5,000 Monsanto Corporation, 6.50%, 11/30/03
(convertible into Pharmacia Corporation
common stock) 226
COMMUNICATIONS 0.5%
1,600 Cox Communications, Inc., 7.75%, 11/15/29
(convertible to Sprint PCS common stock) 163
1,000 Global Crossing Inc., 6.75%, 4/15/12 (convertible
to Global Crossing, Inc. common stock) 252
FOOD, BEVERAGES & TOBACCO 0.3%
6,300 Seagram Company Ltd., 7.50%, 6/21/02 (convertible
to Seagram Company Ltd. common stock) 321
NATURAL GAS 0.7%
27,300 Enron Corporation, 7.00%, 7/31/02
(convertible to EOG Resources common stock) 642
--------------
Total Preferred Stocks (Cost $1,507) 1,604
--------------
See notes to the financial statements.
45
<PAGE>
BALANCED INCOME FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
LONG-TERM INVESTMENTS 45.3%
ASSET-BACKED SECURITIES 3.9%
Auto Loan Receivables 0.9%
Banc One Auto Grantor Trust,
$ 57 Series 1997-A, Class A, 6.27%, 11/20/03 $ 57
Chase Manhattan Auto Owner Trust,
300 Series 1997-B, Class A5, 6.60%, 3/15/02 299
Honda Auto Least Trust,
500 Series 1999-A, Class A5, 6.65%, 7/15/05 495
--------------
851
--------------
CREDIT CARD RECEIVABLES 1.9%
Chemical Master Credit Card Trust I,
250 Series 1995-2, Class A, 6.23%, 6/15/03 249
Citibank Credit Card Master Trust I,
Principal Only:
300 Series 1996-1, Class A, 0.00%, 2/07/01 284
800 Series 1997-6, Class A, 0.00%, 8/15/06 580
Discover Card Master Trust I,
500 Series 1995-2, Class A, 6.55%, 8/15/00 500
Sears Credit Account Master Trust,
150 Series 1995-2, Class A, 8.10%, 6/15/04 151
--------------
1,764
--------------
HOME EQUITY LOAN RECEIVABLES 1.1%
Contimortgage Home Equity Loan Trust,
502 Series 1997-3, Class A9, 7.12%, 8/15/28 482
GE Capital Mortgage Services, Inc.,
200 Series 1996-HE1, Class A4, 7.30%, 2/25/25 198
Green Tree Home Equity Loan Trust,
300 Series 1997-B, Class A6, 7.12%, 4/15/27 297
--------------
977
CORPORATE BONDS 9.9%
ABN Amro Bank Guarantee,
250 7.25%, 5/31/05 245
Air 2 US,
100 10.127%, 10/01/20 101
American West Airlines Pass-Thru Certificates,
125 8.54%, 1/02/06 (Acquired 9/14/99, Cost $125)<F2> 123
AT&T Capital Corp. Company Guarantee,
200 6.25%, 5/15/01 198
Associates Corporation of North America Senior Notes,
150 7.50%, 4/15/02 150
Bank One Corporation Notes,
250 6.875%, 8/01/06 237
BankAmerica Corporation Subordinated Notes,
185 9.20%, 5/15/03 192
BankBoston Corporation Subordinated Notes,
200 6.625%, 2/01/04 192
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 9.9% (CONT.)
Bankers Trust Corporation Subordinated Notes,
$ 200 7.50%, 11/15/15 $ 189
Bank of New York Subordinated Notes,
150 7.875%, 11/15/02 150
Bank of Oklahoma Subordinated Notes,
300 7.125%, 8/15/07 278
Barclays North American Capital Corp. Debentures,
300 9.75%, 5/15/21 319
CE Generations LLC,
400 7.416%, 12/15/18 362
Citicorp Subordinated Notes,
100 9.50%, 2/01/02 103
Conectiv, Inc. Medium Term Notes,
225 6.73%, 6/01/06 217
Continental Airlines Inc. Pass-Thru Certificates,
173 6.80%, 7/02/07 163
Continental Cablevision, Inc. Debentures,
100 9.50%, 8/01/13 107
Donaldson,Lufkin & Jenrette Senior Notes,
200 5.875%, 4/01/02 193
Duty Free International, Inc. Notes,
250 7.00%, 1/15/04 245
Dynegy, Inc. Senior Notes,
200 7.45%, 7/15/06 191
Federal Express Corporation Notes,
180 9.65%, 6/15/12 194
FPL Group Capital, Inc. Guaranteed Notes,
150 7.625%, 9/15/06 148
Goldman Sachs Group Notes,
400 6.25%, 2/01/03 (Acquired 6/30/99, Cost $393)<F2> 384
Lehman Brothers, Inc. Senior Notes,
150 8.75%, 5/15/02 152
Lehman Brothers, Inc. Medium Term Notes,
375 7.50%, 9/01/06 364
Marlin Water Trust Senior Notes,
97 7.09%, 12/15/01 (Acquired 12/9/98, Cost $97)<F2> 95
Merrill Lynch & Co. Notes,
225 8.30%, 11/01/02 230
Midlantic Corporation Subordinated Notes,
240 9.20%, 8/01/01 245
Morgan Stanley Group Debentures,
300 8.875%, 10/15/01 306
National Westminster Bank Debentures,
300 9.375%, 11/15/03 314
Oneok, Inc. Notes,
125 7.75%, 8/15/06 123
Paine Webber Group, Inc. Subordinated Notes,
200 7.75%, 9/01/02 199
See notes to the financial statements.
46
<PAGE>
BALANCED INCOME FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 9.9% (CONT.)
Principal Financial Group Senior Notes,
$ 400 8.20%, 8/15/09 (Acquired 8/18/99, Cost $399)<F2> $ 399
PSI Energy Debentures,
150 7.85%, 10/15/07 145
J.C. Penney Company, Inc. Debentures,
150 8.25%, 8/15/22 122
Salomon, Inc. Notes:
409 7.50%, 2/01/03 407
277 7.00%, 6/15/03 272
Standard Federal Bancorp Medium Term Notes,
250 7.75%, 7/17/06 245
Washington Mutual, Inc. Notes,
250 7.50%, 8/15/06 242
Westdeutsche Landesbank Subordinated Notes:
200 6.05%, 1/15/09 175
400 6.75%, 6/15/05 382
--------------
9,098
--------------
International/Yankee (U.S. $ Denominated) 1.3%
Ford Capital BV Debentures:
200 9.375%, 5/15/01 204
150 9.50%, 6/01/10 162
Household Netherlands BV Company Guarantee,
125 6.20%, 12/01/03 119
Korea Development Bank Bonds,
230 7.125%, 9/17/01 227
Metronet Communications Corp. Senior Notes,
300 9.95%, 6/15/08 236
Norsk Hydro A/S Debentures,
50 9.00%, 4/15/12 54
Stagecoach Holdings PLC Notes,
200 8.625%, 11/15/09 163
Wharf Capital International Ltd. Notes,
50 7.625%, 3/13/07 46
--------------
1,211
--------------
U.S. GOVERNMENT AGENCY-BACKED MORTGAGE ISSUES 0.2%
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC),
51 Series 1201, Class E, 7.40%, 12/15/21 51
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
39 Series 1989-2, Class D, 8.80%, 1/25/19 40
48 Series 1990-89, Class K, 6.50%, 7/25/20 46
23 Series 1991-147, Class K, 7.00%, 1/25/21 23
Government National Mortgage Association (GNMA)
Real Estate Mortgage Investment Conduit (REMIC),
67 Series 3, Class F, 6.50%, 6/17/20 64
--------------
224
--------------
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
U.S. TREASURY OBLIGATIONS 30.0%
U.S. Treasury Bonds,
$8,250 11.625%, 11/15/02 $ 9,186
U.S. Treasury Notes,
1,850 6.375%, 8/15/02 1,839
U.S. Treasury Strips, Principal Only,
22,280 0.00%, 11/15/04 16,542
--------------
27,567
--------------
Total Long-Term Investments (Cost $42,253) 41,692
--------------
NUMBER
OF SHARES
(IN THOUSANDS)
--------------
SHORT-TERM INVESTMENTS 2.1%
INVESTMENT COMPANIES 2.1%
5 Financial Square Prime Obligation Fund 5
1,951 Short-Term Investments Co. Liquid Assets Portfolio 1,951
--------------
Total Investment Companies (Cost $1,956) 1,956
--------------
Total Short-Term Investments (Cost $1,956) 1,956
--------------
Total Investments (Cost $83,790) 99.0% 91,096
--------------
Other Assets, less Liabilities, 1.0% 897
--------------
TOTAL NET ASSETS 100.0% $ 91,993
==============
<F1>Non-income producing
<F2>Unregistered security
See notes to the financial statements.
47
<PAGE>
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMON STOCKS 65.1%
AEROSPACE & DEFENSE 0.5%
19,700 General Dynamics Corporation $ 1,152
7,000 Orbital Sciences Corporation<F1> 88
--------------
1,240
--------------
AIR TRANSPORTATION 0.3%
30,800 Southwest Airlines 668
--------------
BANKING 2.4%
7,300 Bank United Corporation - Class A 242
3,900 CCB Financial Corporation 154
5,750 Charter One Financial, Inc. 117
14,100 Chase Manhattan Corporation 1,016
4,400 Commerce Bancorp, Inc. 175
1,500 Cullen/Frost Bankers, Inc. 37
16,500 Fifth Third Bancorp 1,042
2,300 First Tennessee National Corporation 44
3,700 Marshall & Ilsley Corporation 172
3,500 North Fork Bancorporation, Inc. 57
7,000 Sovereign Bancorp, Inc. 48
24,400 State Street Corporation 2,364
2,200 TCF Financial Corporation 51
2,000 Zions Bancorporation 83
--------------
5,602
--------------
BATTERIES 0.1%
5,100 Rayovac Corporation<F1> 106
--------------
BUILDING & CONSTRUCTION 0.4%
9,300 Astec Industries, Inc.<F1> 234
5,100 Granite Construction, Inc. 121
2,800 Martin Marietta Materials, Inc. 148
800 Southdown, Inc. 46
10,700 Texas Industries, Inc. 349
5,400 U.S. Aggregates, Inc.<F1> 92
--------------
990
--------------
BUSINESS SERVICES 3.2%
9,300 Affiliated Computer Services, Inc.<F1> 308
10,500 The BISYS Group, Inc.<F1> 657
4,900 Ceridian Corporation<F1> 106
1,300 CheckFree Holdings Corporation<F1> 66
3,850 Cintas Corporation 153
12,900 Computer Sciences Corporation<F1> 1,052
3,500 Diebold, Inc. 101
47,400 First Data Corporation 2,308
8,555 FIserv, Inc.<F1> 393
12,900 F.Y.I. Inc.<F1> 346
3,400 Manpower Inc. 120
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
BUSINESS SERVICES 3.2% (CONT.)
3,500 NCO Group, Inc.<F1> $ 120
6,300 Robert Half International Inc. 385
21,900 Sabre Group Holdings, Inc.<F1> 765
11,200 The Source Information Management Company<F1> 165
6,600 Steiner Leisure Ltd. 133
3,450 Symbol Technologies, Inc. 192
2,400 Viad Corp. 61
--------------
7,431
--------------
CHEMICALS 0.2%
14,800 M.A. Hanna Company 170
8,900 Minerals Technologies Inc. 412
--------------
582
--------------
COMMUNICATIONS & MEDIA 2.6%
47,200 Charter Communications, Inc.<F1> 693
2,300 Citadel Communications Corporation<F1> 90
1,200 Hispanic Broadcasting Corporation<F1> 121
27,300 Infinity Broadcasting<F1> 926
33,800 Interpublic Group of Companies, Inc. 1,386
16,900 Omnicom Group, Inc. 1,539
1,200 Univision Communications, Inc.<F1> 131
27,000 The Walt Disney Company 1,169
--------------
6,055
--------------
COMPUTERS 2.0%
13,200 ASM Lithography Holding N.V.<F1> 528
14,600 EMC Corporation<F1> 2,028
19,100 Sun Microsystems, Inc.<F1> 1,756
4,800 Zebra Technologies Corporation<F1> 274
--------------
4,586
--------------
DATA PROCESSING 1.0%
27,200 Acxiom Corporation<F1> 734
3,200 ChoicePoint, Inc.<F1> 122
1,300 CSG Systems International, Inc.<F1> 60
4,200 National Computer Systems, Inc. 216
1,900 Shared Medical Systems Corporation 79
29,700 SunGard Data Systems, Inc. 1,026
--------------
2,237
--------------
DISTRIBUTION 0.3%
5,700 CDW Computer Centers, Inc.<F1> 593
1,200 Fastenal Company 70
--------------
663
See notes to the financial statements.
48
<PAGE>
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
DRUGS 3.9%
3,800 Alpharma, Inc. - Class A $ 147
3,800 ALZA Corporation - Class A<F1> 167
18,000 Bristol-Myers Squibb Company 944
29,100 Eli Lilly & Company 2,250
2,100 Forest Laboratories, Inc.<F1> 177
1,400 MedImmune, Inc.<F1> 224
16,500 Merck & Co., Inc. 1,147
900 Sepracor Inc.<F1> 83
7,300 Shire Pharmaceuticals Group PLC - ADR<F1> 294
24,400 Warner-Lambert Company 2,777
14,900 Watson Pharmaceuticals, Inc.<F1> 670
--------------
8,880
--------------
ELECTRONIC COMPONENTS & SEMICONDUCTORS 9.5%
1,000 Aeroflex Inc.<F1> 37
14,200 Analog Devices,Inc.<F1> 1,091
19,600 Applied Materials, Inc.<F1> 1,996
500 Applied Micro Circuits Corporation<F1> 64
4,400 Atmel Corporation<F1> 215
5,600 ATMI, Inc.<F1> 216
500 AVX Corporation 49
8,000 Benchmark Electronics, Inc.<F1> 321
4,200 Broadcom Corporation<F1> 724
2,200 Burr-Brown Corporation<F1> 150
12,600 Conexant Systems, Inc.<F1> 754
1,900 Credence Systems Corporation<F1> 271
3,400 CTS Corporation 214
2,000 Exar Corporation<F1> 160
15,900 Flextronics International Ltd.<F1> 1,117
16,100 Infineon Technologies ADR<F1> 1,093
11,000 Integrated Device Technology, Inc.<F1> 529
19,100 Intel Corporation 2,422
500 Intersil Holding Corporation<F1> 17
3,200 Kulicke & Soffa Industries, Inc.<F1> 251
3,000 Lam Research Corporation<F1> 138
1,800 LSI Logic Corporation<F1> 112
6,700 Maxim Integrated Products, Inc.<F1> 434
2,000 Micrel, Inc.<F1> 173
23,312 Molex, Inc. - Class A 932
7,400 Novellus Systems, Inc.<F1> 493
5,600 PMC - Sierra, Inc.<F1> 1,075
3,500 Phototronics, Inc.<F1> 117
3,200 Sanmina Corporation<F1> 192
3,200 SCI Systems,Inc.<F1> 170
2,000 Semtech Corporation<F1> 136
5,300 STMicroelectronics N.V. 1,005
6,000 Teradyne,Inc.<F1> 660
22,000 Texas Instruments. Inc. 3,583
2,200 TriQuint Semiconductor, Inc.<F1> 226
2,500 Veeco Instruments Inc.<F1> 155
3,800 Vitesse Semiconductor<F1> 259
2,100 Xilinx, Inc.<F1> 154
--------------
21,705
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
ENTERTAINMENT & LEISURE 0.5%
3,600 Anchor Gaming<F1> $ 145
38,100 Carnival Corporation 948
8,400 Cinar Films Inc. - Class B<F1> 59
--------------
1,152
--------------
FINANCIAL SERVICES 2.7%
27,050 Concord EFS, Inc.<F1> 605
6,900 E*Trade Group, Inc.<F1> 148
14,600 Federal Home Loan Mortgage Corporation 671
7,900 Federal National Mortgage Association 476
4,200 Federated Investors, Inc. 119
24,900 Franklin Resources, Inc. 803
63,700 MBNA Corporation 1,692
20,600 Morgan Stanley Dean Witter & Company 1,581
--------------
6,095
--------------
FOOD & BEVERAGE 0.5%
2,800 Canandaigua Brands, Inc.<F1> 141
16,500 PepsiCo, Inc. 605
6,500 SUPERVALU, Inc. 134
15,400 Universal Foods Corporation 253
--------------
1,133
--------------
HEALTH CARE SERVICES & SUPPLIES 1.1%
20,625 Cardinal Health, Inc. 1,136
24,353 Health Management Associates, Inc. - Class A<F1> 388
46,200 IMS Health Inc. 788
9,700 Lincare Holdings, Inc.<F1> 296
600 Omnicare,Inc. 9
--------------
2,617
--------------
INSURANCE 3.0%
19,400 AFLAC, Inc. 947
1,900 Allmerica Financial Corporation 103
3,400 Ambac Financial Group, Inc. 163
19,755 American International Group 2,167
9,900 Aon Corporation 268
13,200 Arthur J. Gallagher & Company 492
6,800 Enhance Financial Services Group Inc. 69
3,900 Financial Security Assurance Holdings Ltd. 288
7,200 Hooper Holmes, Inc. 125
600 Jefferson - Pilot Corporation 40
17,400 MetLife, Inc.<F1> 288
26,100 MGIC Investment Corporation 1,248
1,900 Nationwide Financial Services,Inc. 53
1,350 The PMI Group, Inc. 65
8,500 Protective Life Corporation 202
1,900 ReliaStar Financial Corporation 82
1,800 Torchmark Corporation 44
3,000 XL Capital Ltd. 143
--------------
6,787
--------------
See notes to the financial statements.
49
<PAGE>
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
INTERNET PRODUCTS & SERVICES 0.2%
4,400 Ariba, Inc.<F1> $ 326
6,900 EDGAR Online, Inc.<F1> 45
700 PurchasePro.com, Inc.<F1> 21
2,500 Verio Inc.<F1> 94
--------------
486
--------------
MEDICAL 1.0%
2,300 Aclara Biosciences Inc.<F1> 88
500 C.R. Bard, Inc. 22
2,000 Chiron Corporation<F1> 90
3,700 Genentech, Inc.<F1> 433
14,300 Johnson & Johnson 1,180
1,400 Millennium Pharmaceuticals, Inc.<F1> 111
3,200 Mylan Laboratories Inc. 91
25,500 QuadraMed Corporation<F1> 100
6,100 Texas Biotechnology Corporation<F1> 75
--------------
2,190
--------------
MEDICAL INSTRUMENTS 1.5%
5,000 Biomet, Inc. 178
2,200 Coherent, Inc.<F1> 127
10,475 DENTSPLY InternationalInc. 304
9,300 Edwards Lifesciences Corporation<F1> 139
9,300 Guidant Corporation 534
25,000 Medtronic, Inc.<F1> 1,298
500 MiniMed Inc.<F1> 61
3,800 Patterson Dental Company<F1> 183
18,800 Renal Care Group, Inc.<F1> 419
1,900 Stryker Corporation 137
7,400 Sybron International Corporation<F1> 230
--------------
3,610
--------------
METALS & MINERALS 0.0%
5,900 Prudential Steel Ltd. 60
--------------
MULTI-INDUSTRY 1.3%
7,500 GSI Lumonics Inc.<F1> 141
6,200 Kaydon Corporation 145
4,500 Mettler-Toledo International Inc.<F1> 157
6,000 Pentair, Inc. 230
49,000 Tyco International, Ltd. 2,251
--------------
2,924
--------------
NATURAL GAS 0.8%
26,800 Enron Corporation 1,868
--------------
NETWORKING PRODUCTS 2.4%
3,700 Black Box Corporation<F1> 285
50,000 Cisco Systems, Inc.<F1> 3,466
1,800 Juniper Networks, Inc.<F1> 383
15,600 Network Appliance, Inc.<F1> 1,153
1,700 QLogic Corporation<F1> 171
3,000 Xircom, Inc.<F1> 118
--------------
5,576
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
OIL & GAS - DOMESTIC 1.7%
6,900 Barrett Resources Corporation<F1> $ 219
1,900 Devon Energy Corporation 92
61,000 EOG Resources, Inc. 1,517
4,000 Newfield Exploration Company<F1> 163
13,500 Phillips Petroleum Company 640
2,900 St. Mary Land & Exploration Company 98
16,000 Texaco Inc. 792
7,600 Valero Energy Corporation 220
6,300 Veritas DGC Inc.<F1> 151
--------------
3,892
--------------
OIL & GAS SERVICES 2.2%
2,000 BJ Services Company<F1> 141
3,400 Dynegy Inc. 222
9,500 El Paso Energy Corporation 404
3,500 ENSCO International Incorporated 116
4,600 Global Marine Inc.<F1> 110
2,600 Grant Prideco, Inc.<F1> 50
20,200 Halliburton Company 893
1,000 Hanover Compressor Company<F1> 58
4,600 Kinder Morgan,Inc. 139
5,100 Nabors Industries, Inc.<F1> 201
4,100 National-Oilwell, Inc.<F1> 98
3,300 Noble Drilling Corporation<F1> 132
12,600 Ocean Energy Inc.<F1> 163
5,600 Petroleum Geo-Services ASA-ADR<F1> 90
9,100 Precision Drilling Corporation<F1> 291
1,000 Santa Fe International Corporation 34
20,700 Schlumberger Limited<F1> 1,585
1,000 Smith International, Inc.<F1> 76
3,800 Talisman Energy Inc.<F1> 114
2,600 Weatherford International, Inc.<F1> 106
--------------
5,023
--------------
PAPER & RELATED PRODUCTS 0.3%
8,800 Champion International Corporation 579
1,800 Consolidated Papers, Inc. 68
--------------
647
--------------
PRINTING & PUBLISHING 0.1%
2,100 Scholastic Corporation<F1> 98
--------------
RENTAL EQUIPMENT 0.2%
10,600 Avis Group Holdings, Inc.<F1> 215
6,000 Rent-A-Center, Inc.<F1> 122
--------------
337
--------------
RESTAURANTS 0.1%
3,600 Brinker International, Inc.<F1> 115
2,900 Starbucks Corporation<F1> 88
--------------
203
--------------
See notes to the financial statements.
50
<PAGE>
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
RETAIL 6.8%
8,600 Ames Department Stores, Inc.<F1> $ 154
4,000 BJ's Wholesale Club<F1> 142
18,800 Circuit City Stores Inc. 1,106
20,800 Costco Companies, Inc.<F1> 1,125
31,965 Dollar General Corporation 731
34,100 Family Dollar Stores 650
45,100 Goody's Family Clothing, Inc.<F1> 293
18,750 Home Depot, Inc. 1,051
10,150 InterTAN, Inc.<F1> 140
29,400 Kohl's Corporation<F1> 1,411
5,200 Linens 'n Things, Inc.<F1> 161
39,420 Lowe's Companies, Inc. 1,951
12,200 The Men's Wearhouse, Inc.<F1> 262
4,100 Ross Stores, Inc. 85
43,600 Safeway, Inc.<F1> 1,924
16,300 Target Corporation 1,085
1,500 Tiffany & Company 109
30,000 Wal-Mart Stores, Inc. 1,661
42,700 Walgreen Company<F1> 1,201
7,500 Whitehall Jewelers, Inc.<F1> 129
4,200 Williams-Sonoma, Inc.<F1> 145
--------------
15,516
--------------
SOFTWARE 2.7%
8,400 Aspen Technology, Inc.<F1> 297
7,100 Citrix Systems, Inc.<F1> 434
600 Electronic Arts, Inc.<F1> 36
11,200 General Magic, Inc.<F1> 62
2,500 Intuit Inc.<F1> 90
1,400 Mercury Interactive Corporation<F1> 126
37,900 Microsoft Corporation<F1> 2,644
1,200 NVIDIA Corporation<F1> 107
14,400 Oracle Corporation<F1> 1,151
4,100 Rational Software Corporation<F1> 349
1,100 SAGA SYSTEMS, Inc.<F1> 20
1,500 Symantec Corporation<F1> 94
5,325 VERITAS Software Corporation<F1> 571
8,100 Verity, Inc.<F1> 263
--------------
6,244
--------------
TELECOMMUNICATIONS 2.0%
5,900 AT&T Wireless Group<F1> 188
8,500 ALLTEL Corporation 566
26,100 Broadwing Inc.<F1> 759
2,400 McLeodUSA, Incorporated<F1> 60
27,786 MCI WorldCom, Inc.<F1> 1,263
9,600 Nextel Communications, Inc.<F1> 1,051
4,600 Telesystem International Wireless Inc.<F1> 152
5,100 Voicestream Wireless Corporation<F1> 505
--------------
4,544
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
TELECOMMUNICATIONS EQUIPMENT 5.9%
4,300 ADTRAN, Inc.<F1> $ 291
4,400 Alpha Industries, Inc. 229
8,700 CIENA Corporation<F1> 1,076
6,000 Comverse Technology, Inc.<F1> 535
2,600 Corning Incorporated 513
1,500 Crown Castle International Corporation<F1> 58
1,700 Ditech Communications Corporation<F1> 146
6,200 Ericsson AB 548
700 Harmonic Inc.<F1> 52
3,800 Harris Corporation 123
14,600 JDS Uniphase Corporation<F1> 1,514
4,600 Motorola, Inc. 548
34,400 Nokia Corp. - ADR 1,957
25,400 Nortel Networks Corporation 2,877
1,400 Polycom, Inc.<F1> 111
1,400 Powerwave Technologies, Inc.<F1> 291
9,200 QUALCOMM Incorporated<F1> 998
11,900 Scientific-Atlantic, Inc. 774
7,900 Siebel Systems, Inc.<F1> 971
--------------
13,612
--------------
TELECOMMUNICATIONS SERVICES 0.5%
2,200 Adelphia Business Solutions, Inc.<F1> 77
1,050 Allegiance Telecom, Inc.<F1> 74
12,600 Global Crossing Ltd.<F1> 397
4,900 MGC Communications, Inc.<F1> 240
1,600 Powertel, Inc.<F1> 108
3,900 Viatel, Inc.<F1> 149
--------------
1,045
--------------
TEXTILES & APPAREL 0.1%
2,900 Jones Apparel Group, Inc.<F1> 86
--------------
TRANSPORTATION 0.7%
6,500 Circle International Group, Inc. 173
7,100 EGL, Inc.<F1> 163
1,500 GATX Corporation 54
32,800 Harley-Davidson, Inc. 1,306
--------------
1,696
--------------
UTILITIES 0.4%
2,200 Calpine Corporation<F1> 201
4,900 Constellation Energy Group 162
4,400 Edison International 84
9,800 Kansas City Power & Light Company 252
1,900 Montana Power Company 84
3,700 PECO Energy Company 154
1,500 Wisconsin Energy Corporation 32
--------------
969
--------------
Total Common Stocks (Cost $148,772) 149,155
--------------
See notes to the financial statements.
51
<PAGE>
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
LONG-TERM INVESTMENTS 33.6%
ASSET-BACKED SECURITIES 2.9%
CREDIT CARD RECEIVABLES 1.7%
Chase Credit Card Master Trust,
$ 500 Series 1996-1, 5.55%, 1/15/01 $ 495
Chemical Master Credit Card Trust,
2,300 Series 1995-2, 6.23%, 6/15/03 2,295
Citibank Credit Card Master Trust, Principal Only,
200 Series 1997-6, 0.00%, 8/15/06 145
Household Affinity Credit Card Master Trust I,
292 Series 1993-2, Class A, 5.60%, 11/15/00 291
Sears Credit Account Master Trust:
450 Series 1994-1, Class A, 7.00%, 8/15/00 450
263 Series 1995-2, Class A, 8.10%, 1/15/01 264
--------------
3,940
--------------
HOME EQUITY LOAN RECEIVABLES 1.2%
Contimortgage Home Equity Loan Trust,
700 Series 1997-5, Class A5, 6.63%, 12/15/20 675
Merrill Lynch Mortgage Investors, Inc.,
1,244 Series 1998-C1, Class A1, 6.31%, 11/15/26 1,192
Saxon Asset Securities Trust,
900 Series 1997-1, Class AF5, 7.325%, 1/25/12 887
--------------
2,754
--------------
CORPORATE BONDS 14.1%
ABN AMRO Bank Guarantee,
1,000 7.25%, 5/31/05 981
Air 2 US,
400 10.127%, 10/01/20 406
America West Airlines Pass-Thru Certificates:
376 8.54%, 1/02/06 (Acquired 9/14/99, Cost $376)<F2> 369
653 7.93%, 1/02/19 (Acquired 9/14/99, Cost $653)<F2> 650
Atlantic Richfield Co. Debentures,
300 8.50%, 4/01/12 319
BankAmerica Corporation Subordinated Notes,
350 7.75%, 7/15/02 351
BankBoston Corporation Subordinated Notes,
1,225 6.625%, 2/01/04 1,176
Bank One Corporation Notes,
300 6.875%, 8/01/06 285
Bankers Trust Corporation Subordinated Debentures,
1,775 8.125%, 5/15/02 1,786
Barclays American Corp. Debentures,
250 9.75%, 5/15/21 266
CE Generations LLC,
600 7.416%, 12/15/18 543
CIT Group, Inc. Senior Notes,
950 5.57%, 12/08/03 883
Commonwealth Edison Debentures,
900 9.875%, 6/15/20 972
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 14.1% (CONT.)
Compass Bancshares, Inc. Subordinated Notes,
$ 400 8.375%, 9/15/04 $ 406
Continental Bank Subordinated Notes,
300 12.50%, 4/01/01 314
Continental Cablevision, Inc. Debentures:
350 8.875%, 9/15/05 366
900 9.50%, 8/01/13 964
Donaldson,Lufkin & Jenrette Senior Notes:
1,000 6.00%, 12/01/01 976
800 6.875%, 11/01/05 761
Dresdner Bank New York Subordinated Debentures,
800 7.25%, 9/15/15 730
Duty Free International, Inc. Notes,
975 7.00%, 1/15/04 955
Dynegy, Inc. Senior Notes,
1,000 7.45%, 7/15/06 956
Federal Express Corporation Notes,
500 9.65%, 6/15/12 539
First Bank System Subordinated Notes,
975 6.625%, 5/15/03 947
General Motors Acceptance Corp. Medium Term Notes,
1,000 6.70%, 4/30/01 995
Georgia Pacific Corporation Debentures:
300 9.50%, 12/01/11 318
300 9.875%, 11/01/21 306
100 9.50%, 5/15/22 100
Goldman Sachs Group Notes,
1,500 6.25%, 2/01/03 (Acquired 2/01/96; Cost $1,496)<F2> 1,441
Keycorp Subordinated Notes,
730 8.00%, 7/01/04 733
Lehman Brothers Holdings, Inc. Notes:
350 6.65%, 11/08/99 349
200 8.75%, 5/15/02 203
500 7.80%, 7/07/05 488
500 8.50%, 8/01/15 499
Marlin Water Trust Senior Notes,
677 7.09%, 12/15/01 (Acquired 12/9/98, Cost $680)<F2> 665
The May Department Stores Company Debentures,
300 9.875%, 6/15/21 319
Merrill Lynch & Co. Notes,
925 6.875%, 11/15/18 823
NCNB Corporation Subordinated Notes,
750 10.20%, 7/15/15 893
News America Holdings, Inc. Debentures,
300 10.125%, 10/15/12 307
PSI Energy, Inc. Debentures,
600 7.85%, 10/15/07 579
Paine Webber Group, Inc. Notes:
500 7.875%, 2/15/03 497
500 8.875%, 3/15/05 511
See notes to the financial statements.
52
<PAGE>
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
Principal Amount Market Value
(in thousands) (in thousands)
---------------- --------------
CORPORATE BONDS 14.4% (CONT.)
JC Penney Company, Inc. Debentures:
$ 625 9.75%, 6/15/21 $ 549
500 8.25%, 8/15/22 405
Rochester Telephone Debentures,
400 9.00%, 8/15/21 374
Salomon, Inc. Senior Notes,
575 6.75%, 2/15/03 562
Salomon Smith Barney Holdings, Inc. Notes,
700 6.875%, 6/15/05 673
Stagecoach Holdings PLC Notes,
300 8.625%, 11/15/09 245
Tenneco, Inc. Debentures,
425 7.45%, 12/15/25 392
USF&G Corporation Senior Notes:
1,000 8.375%, 6/15/01 1,009
350 7.125%, 6/01/05 333
U.S. West Communications Group Debentures,
575 8.875%, 6/01/31 581
Utilicorp United Inc. Senior Notes,
350 7.00%, 7/15/04 338
--------------
32,388
--------------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 3.2%
Banco Santander-Chile Notes,
475 6.560%, 11/01/05 452
Ford Capital BV Debentures,
325 9.875%, 5/15/02 337
Hydro-Quebec Corporation Debentures:
350 11.75%, 2/01/12 456
500 9.75%, 1/15/18 522
Korea Development Bank Bonds,
585 7.125%, 9/17/01 578
Korea Electric Power Debentures:
290 7.75%, 4/01/13 264
200 6.75%, 8/01/27 186
Midland Bank PLC Subordinated Notes,
950 6.95%, 3/15/11 875
National Bank of Hungary Debentures,
250 8.875%, 11/01/13 258
Norsk Hydro A/S Debentures,
350 9.00%, 4/15/12 375
Pohang Iron & Steel Notes,
200 7.125%, 7/15/04 189
Principal Financial Group (Australia) Senior Notes,
1,400 8.20%, 8/15/09 (Acquired 8/18/99, Cost $1,396)<F2> 1,397
Sweden (Kingdom of) Debentures,
150 11.125%, 6/01/15 194
WestDeutsche Landesbank NY Subordinated Notes,
700 6.05%, 1/15/09 614
Wharf Capital International Ltd. Notes:
325 8.875%, 11/01/04 327
225 7.625%, 3/13/07 209
--------------
7,233
--------------
Principal Amount Market Value
(in thousands) (in thousands)
-------------- --------------
U.S. GOVERNMENT AGENCY-BACKED MORTGAGE ISSUES 1.9%
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC):
$ 259 Series 85, Class C, 8.60%, 1/15/21 $ 263
27 Series 1169, Class D, 7.00%, 5/15/21 27
339 Series 1136, Class H, 6.00%, 9/15/21 317
237 Series 1201, Class E, 7.40%, 12/15/21 236
Federal Home Loan Mortgage
Corporation Notes (FHLMC),
2,950 6.625%, 9/15/09 2,810
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
260 Series 1989-37, Class XX, 8.00%, 7/25/19 261
230 Series 1990-30, Class E, 6.50%, 3/25/20 218
235 Series 1990-105, Class J, 6.50%, 9/25/20 224
--------------
4,356
--------------
U.S. Treasury Obligations 11.5%
U.S. Treasury Bonds:
175 9.875%, 11/15/15 235
15,885 9.25%, 2/15/16 20,456
U.S. Treasury Notes,
5,700 6.625%, 5/15/07 5,739
--------------
26,430
--------------
Total Long-Term Investments (Cost $77,483) 77,101
--------------
Number
of Shares
(in thousands)
--------------
SHORT-TERM INVESTMENTS 2.0%
INVESTMENT COMPANIES 2.0%
4,531 Short-Term Investments Co. Liquid Assets Portfolio 4,531
--------------
Total Short-Term Investments (Cost $4,531) 4,531
--------------
Total Investments (Cost $182,505) 100.7% 230,787
--------------
Liabilities, less Other Assets (0.7)% (1,479)
--------------
TOTAL NET ASSETS 100.0% $229,308
==============
<F1> Non-income producing
<F2> Unregistered security
53
<PAGE>
GROWTH AND INCOME FUND
SCHEDULE OF INVESTMENTS
April 30, 2000
(Unaudited)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMON STOCKS 94.9%
AUTO & TRUCK PARTS 0.3%
96,200 Delphi Automotive Systems Corporation $ 1,840
--------------
BANKING 7.0%
274,300 Bank of New York 11,263
144,500 Chase Manhattan Corporation 10,413
233,700 Mellon Bank Corporation 7,508
214,300 Northern Trust Corporation 13,742
131,200 Wells Fargo Company, Inc. 5,387
--------------
48,313
--------------
BUILDING MATERIALS 1.1%
181,900 Vulcan Materials Company 7,969
--------------
BUSINESS MACHINES & SOFTWARE 3.1%
35,200 Hewlett-Packard Company 4,752
46,500 International Business Machines Corporation 5,191
110,400 Microsoft Corporation<F1> 7,700
45,675 Sun Microsystems, Inc.<F1> 4,199
--------------
21,842
--------------
BUSINESS SERVICES 5.3%
169,000 Automatic Data Processing, Inc. 9,094
55,200 Electronic Data Systems Corporation 3,795
164,200 First Data Corporation 7,994
281,000 Manpower, Inc. 9,923
242,600 Viad Corporation 6,156
--------------
36,962
--------------
CHEMICALS 3.8%
309,600 Ecolab, Inc. 12,094
203,600 Millipore Corporation 14,596
--------------
26,690
--------------
COMMUNICATIONS & MEDIA 6.4%
136,600 CBS Corporation<F1> 8,025
64,400 The Walt Disney Company 2,789
37,200 General Motors Corporation - Class H 3,583
102,300 Infinity Broadcasting Corporation<F1> 3,472
219,400 Interpublic Group of Companies, Inc. 8,995
188,500 New York Times Company - Class A 7,764
111,100 Time Warner, Inc. 9,992
--------------
44,620
--------------
COMPUTERS 2.1%
73,400 Compaq Computer Corporation 2,147
98,600 Dell Computer Corporation<F1> 4,942
51,600 EMC Corporation<F1> 7,169
--------------
14,258
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
CONSUMER PRODUCTS 0.8%
86,900 Avery Dennison Corporation $ 5,703
--------------
COSMETICS & SOAP 1.0%
77,200 Avon Products, Inc. 3,204
83,700 Estee Lauder Companies, Inc. 3,693
--------------
6,897
--------------
DRUGS & MEDICAL SUPPLY 9.9%
171,800 American Home Products Corporation 9,653
169,400 Bristol-Myers Squibb Company 8,883
141,300 Eli Lilly & Company 10,924
128,300 Johnson & Johnson 10,585
143,800 Medtronic, Inc. 7,469
55,100 Merck & Company, Inc. 3,829
153,400 Warner-Lambert Company 17,459
--------------
68,802
--------------
ELECTRIC 0.7%
28,400 Duke Power Company 1,633
76,600 Montana Power Company 3,372
--------------
5,005
--------------
ELECTRICAL EQUIPMENT 1.6%
69,200 General Electric Company 10,882
--------------
ELECTRONICS & SCIENTIFIC EQUIPMENT 5.2%
85,900 Intel Corporation 10,893
120,500 Molex, Inc. - Class A 4,820
71,700 Solectron Corporation<F1> 3,356
104,500 Texas Instruments, Inc. 17,020
--------------
36,089
--------------
FINANCIAL SERVICES 9.8%
338,100 Alliance Capital Management L.P. 15,151
52,900 American Express Company 7,938
144,200 H&R Block, Inc. 6,027
227,300 Citigroup, Inc. 13,510
201,800 Franklin Resources, Inc. 6,508
111,700 Marsh & McLennan Companies, Inc. 11,009
99,900 Morgan Stanley Dean Witter & Company 7,667
--------------
67,810
--------------
FOOD, BEVERAGES & TOBACCO 2.9%
115,000 Anheuser-Busch Companies, Inc. 8,115
209,000 PepsiCo, Inc. 7,668
108,600 Sysco Corporation 4,086
--------------
19,869
--------------
See notes to the financial statements.
54
<PAGE>
GROWTH AND INCOME FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
HEALTHCARE SERVICES & SUPPLIES 0.9%
145,300 Columbia/HCA Healthcare Corporation $ 4,132
15,500 Genetech, Inc.<F1> 1,814
--------------
5,946
--------------
INSURANCE 1.0%
63,100 American International Group, Inc. 6,921
--------------
METALS & MINERALS 0.4%
39,100 ALCOA, Inc. 2,537
--------------
MULTI-INDUSTRY 2.5%
137,700 Pentair, Inc. 5,267
271,400 Tyco International, Ltd. 12,467
--------------
17,734
--------------
NATURAL GAS 2.1%
78,175 El Paso Energy Corporation 3,322
157,200 Enron Corporation 10,955
--------------
14,277
--------------
OIL - DOMESTIC 1.9%
143,200 Phillips Petroleum Company 6,793
279,300 USX Corporation - Marathon Group, Inc. 6,511
--------------
13,304
--------------
OIL - INTERNATIONAL 1.1%
98,519 Exxon Mobil Corporation 7,654
--------------
OIL - SERVICES 2.4%
137,700 Nabors Industries<F1> 5,431
133,900 Schlumberger Ltd. 10,252
23,100 Transocean Sedco Forex, Inc. 1,086
--------------
16,769
--------------
PAPER & FOREST PRODUCTS 1.2%
100 Consolidated Papers, Inc. 4
99,600 Kimberly-Clark Corporation 5,783
70,800 Mead Corporation 2,465
--------------
8,252
--------------
PRINTING & PUBLISHING 2.5%
137,800 Harcourt General, Inc. 5,147
39,200 Houghton Mifflin Company 1,632
195,300 McGraw-Hill, Inc. 10,253
--------------
17,032
--------------
REAL ESTATE INVESTMENT TRUSTS (REITS) 0.6%
183,400 AMB Property Corporation 4,046
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
RETAIL 3.6%
60,200 Costco Wholesale Corporation<F1> $ 3,255
177,400 Gap, Inc. 6,519
16,800 Kohl's Corporation<F1> 806
76,700 Lowe's Companies, Inc. 3,797
49,200 Target Corporation 3,275
267,000 Walgreen Company 7,509
--------------
25,161
--------------
TELECOMMUNICATIONS 6.2%
160,600 AT&T Corporation 7,498
104,500 ALLTEL Corporation 6,962
200,600 Bell Atlantic Corporation 11,886
138,000 Broadwing, Inc.<F1> 3,907
209,200 Sprint Corporation 12,866
--------------
43,119
--------------
TELECOMMUNICATIONS EQUIPMENT 5.9%
135,600 Cisco Systems, Inc.<F1> 9,401
23,200 Corning Incorporated 4,582
39,000 Ericsson AB - ADR 3,449
23,500 Motorola, Inc. 2,798
156,400 Nokia Corporation 8,895
102,700 Nortel Networks Corporation 11,631
--------------
40,756
--------------
TRANSPORTATION 1.6%
78,400 Expeditors International of Washington, Inc. 3,352
117,950 United Parcel Service, Inc. 7,844
--------------
11,196
--------------
Total Common Stock (Cost $486,433) 658,256
--------------
See notes to the financial statements.
55
<PAGE>
GROWTH AND INCOME FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
PREFERRED STOCKS 3.3%
COMMUNICATIONS 0.8%
23,100 Cox Communications Inc.,
7.75%, 11/15/29 (convertible to
Sprint PCS Inc. common stock) $ 2,346
13,400 Global Crossing Inc.,
6.75%, 4/15/12 (convertible to
Global Crossing Inc. common stock) 3,378
DRUGS 0.5%
71,800 Monsanto Corporation,
6.50%, 11/30/03 (convertible to
Pharmacia Corporation common stock) 3,249
FOOD, BEVERAGES & TOBACCO 0.7%
88,100 Seagram Company Ltd.,
7.00%, 7/31/02 (convertible to
Seagram Company Ltd. common stock) 4,482
NATURAL GAS 1.3%
383,300 Enron Corporation,
7.00%, 7/31/02 (convertible to EOG
Resources common stock) 9,007
--------------
Total Preferred Stock (Cost $21,470) $ 22,462
--------------
NUMBER
OF SHARES MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
-------------- --------------
SHORT-TERM INVESTMENTS 2.0%
INVESTMENT COMPANIES 2.0%
1 Financial Square Prime Obligation Fund $ 1
14,334 Short-Term Investments Co. Liquid Assets Portfolio 14,334
--------------
14,335
--------------
Total Investment Companies (Cost $14,335) 14,335
--------------
Total Investments (Cost $522,238) 100.2% 695,053
--------------
Liabilities less, Other Assets (0.2)% (1,601)
--------------
TOTAL NET ASSETS 100.0% $693,452
==============
<F1> Non-income producing
See notes to the financial statements.
56
<PAGE>
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMON STOCKS 95.0%
AEROSPACE & AIRCRAFT 0.9%
60,326 Boeing Company $ 2,394
12,100 General Dynamics Corporation 708
24,468 Lockheed Martin Corporation 609
3,800 Northrop Grumman Corporation 269
20,800 Raytheon Company 462
11,800 Rockwell International Corporation 465
1,737 Teledyne Technologies, Inc.<F1> 30
9,300 Textron, Inc. 576
29,900 United Technologies Corporation 1,859
--------------
7,372
--------------
AIR TRANSPORTATION 0.3%
10,700 AMR Corporation<F1> 364
8,400 Delta Air Lines, Inc. 443
17,700 FDX Corporation<F1> 667
29,925 Southwest Airlines Company 649
4,700 US Airways Group, Inc.<F1> 131
--------------
2,254
--------------
APPLIANCES 0.1%
2,200 Armstrong World Industries, Inc. 43
5,300 Black & Decker Corporation 223
5,300 Maytag Corporation 183
3,900 Snap-On Tools, Inc. 103
4,600 Whirlpool Corporation 300
--------------
852
--------------
AUTOS & TRUCKS 1.3%
8,300 Autozone, Inc.<F1> 190
10,038 Dana Corporation 305
33,638 Delphi Automotive Systems 643
4,500 Eaton Corporation 378
75,000 Ford Motor Company 4,102
40,200 General Motors Corporation 3,764
11,237 Genuine Parts Company 295
5,600 ITT Industries, Inc. 177
3,900 Navistar International Corporation 137
4,240 PACCAR, Inc. 202
7,200 TRW, Inc. 421
--------------
10,614
--------------
BANKING 6.0%
24,400 AMSouth Bancorp 355
73,194 Banc One Corporation 2,232
47,200 Bank of New York Company, Inc. 1,938
110,207 BankAmerica Corporation 5,400
20,700 BB&T Corporation 551
54,220 Chase Manhattan Corporation 3,907
217,602 Citigroup, Inc. 12,934
9,100 Comerica, Inc. 386
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
----------- --------------
BANKING 6.0% (CONT.)
18,650 Fifth Third Bancorp $ 1,177
61,728 First Union Corporation 1,968
59,737 Firstar Corporation 1,486
56,305 Fleet Financial Group, Inc. 1,995
15,590 Huntington Bancshares Incorporated 285
11,000 J.P. Morgan & Co., Inc. 1,412
32,300 Mellon Bank Corporation 1,038
13,700 Northern Trust Corporation 879
7,000 Old Kent Financial Corporation 211
18,800 PNC Bank Corporation 820
13,300 Regions Financial Corporation 272
10,000 SouthTrust Corporation 239
10,000 State Street Corporation 969
10,200 Summit Bancorp. 259
19,900 Sun Trust Banks, Inc. 1,010
16,100 Synovus Financial Corp. 299
45,055 US Bancorp 915
8,500 Union Planters Corp. 241
12,100 Wachovia Corporation 759
36,837 Washington Mutual, Inc. 942
102,330 Wells Fargo & Company 4,202
--------------
49,081
--------------
Bio-Technology 0.4%
63,400 Amgen, Inc.<F1> 3,550
--------------
BUILDING & HOUSING 0.1%
3,700 Centex Corporation 89
4,600 Fluor Corporation 154
3,000 Kaufman and Broad Home Corporation 58
27,100 Masco Corporation 608
2,700 Pulte Corporation 58
6,100 The Stanley Works 180
--------------
1,147
--------------
BUILDING MATERIALS 0.1%
4,800 Johnson Controls, Inc. 304
2,900 Owens-Corning Corporation 53
5,900 Vulcan Materials Company 258
--------------
615
--------------
BUSINESS MACHINES & SOFTWARE 5.5%
10,000 Apple Computer, Inc.<F1> 1,241
105,309 COMPAQ Computer Corporation 3,080
48,825 Honeywell, Inc. 2,734
113,800 International Business Machines Corporation 12,703
180,236 Oracle Systems Corporation<F1> 14,408
16,600 Pitney-Bowes, Inc. 679
100,700 Sun Microsystems, Inc.<F1> 9,258
41,000 Xerox Corporation 1,084
--------------
45,187
--------------
See notes to the financial statements.
57
<PAGE>
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
BUSINESS SERVICES 5.1%
3,300 Autodesk, Inc. $ 127
38,300 Automatic Data Processing, Inc. 2,061
15,100 BMC Software<F1> 707
5,700 H & R Block, Inc. 238
8,800 Ceridian Corporation<F1> 191
433,800 Cisco Systems, Inc.<F1> 30,075
33,187 Computer Associates International, Inc. 1,852
10,400 Computer Sciences Corporation<F1> 848
4,700 Deluxe Corporation 118
9,721 Dun & Bradstreet Corporation 293
30,500 Electronic Data Systems 2,097
9,000 Equifax Inc. 220
26,800 First Data Corporation 1,305
2,600 National Service Industries 56
14,600 Paychex, Inc.<F1> 768
7,200 Quintiles Transnational Corporation<F1> 103
15,100 Service Corporation International 77
19,400 Unisys Corporation<F1> 450
4,200 Young & Rubicam Inc. 234
--------------
41,820
--------------
CHEMICALS 1.1%
13,700 Air Products and Chemicals, Inc. 426
13,600 Dow Chemical Company 1,537
65,199 Dupont (E.I.) De Nemours & Company 3,093
4,637 Eastman Chemical Company 243
7,900 Ecolab, Inc. 309
4,500 W.R. Grace & Co.<F1> 59
3,100 Great Lakes Chemical Corporation 84
6,000 Hercules, Inc. 93
2,600 Millipore Corporation 186
10,300 PPG Industries, Inc. 560
9,400 Praxair, Inc. 418
12,644 Rohm & Haas Company 450
10,100 Sherwin-Williams Company 251
6,300 Sigma-Aldrich Corporation 185
8,350 Union Carbide Corporation 493
26,800 The Williams Companies, Inc. 1,000
--------------
9,387
--------------
COMMUNICATIONS & MEDIA 2.7%
4,350 Andrew Corporation<F1> 128
47,600 CBS Corporation<F1> 2,797
20,600 Clear Channel Communications, Inc.<F1> 1,483
59,700 Comcast Corporation - Class A 2,392
5,100 Dow Jones & Company, Inc. 331
17,300 Gannett Company, Inc. 1,105
4,300 Harcourt General, Inc. 161
17,500 Interpublic Group of Companies, Inc. 718
5,000 Knight-Ridder, Inc. 245
38,253 Mediaone Group, Inc.<F1> 2,893
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMUNICATIONS & MEDIA 2.7% (CONT.)
10,800 New York Times Company - Class A $ 445
10,600 Omnicom Group, Inc. 965
82,800 Time Warner, Inc. 7,447
4,323 Times Mirror Company - Class A 422
14,000 Tribune Company 544
--------------
22,076
--------------
COMPUTERS 2.8%
164,100 Dell Computer Corporation<F1> 8,226
65,600 EMC Corporation<F1> 9,114
18,600 Gateway 2000, Inc.<F1> 1,028
6,000 NCR Corporation<F1> 232
18,600 Network Appliance, Inc.<F1> 1,375
13,900 Seagate Technology, Inc.<F1> 706
11,200 Silicon Graphics, Inc.<F1> 81
22,400 Veritas Software Corporation<F1> 2,403
--------------
23,165
--------------
CONSUMER DURABLES 0.1%
19,950 Eastman Kodak Company 1,116
2,128 Polaroid Corporation 43
--------------
1,159
--------------
CONSUMER PRODUCTS 0.2%
7,200 Avery Dennison Corporation 473
6,467 Energizer Holdings, Inc.<F1> 110
2,100 Jostens, Inc. 52
18,800 Nabisco Group Holdings 242
17,500 Newell Rubbermaid, Inc. 441
3,200 Tupperware Corporation 60
608 Water Pik Technologies, Inc.<F1> 4
--------------
1,382
--------------
CONTAINERS 0.1%
1,900 Ball Corporation 60
2,800 Bemis Company, Inc. 103
6,900 Crown Cork & Seal Company, Inc. 112
8,900 Owens-Illinois, Inc.<F1> 120
9,624 Pactiv Corporation<F1> 79
4,904 Sealed Air Corporation<F1> 273
--------------
747
--------------
COSMETICS & SOAP 1.3%
3,500 Alberto-Culver Company 83
16,200 Avon Products, Inc. 672
14,000 Clorox Company 514
36,200 Colgate-Palmolive Company 2,068
68,688 Gillette Company 2,541
6,600 International Flavors & Fragrances, Inc. 227
82,300 Procter & Gamble Company 4,907
--------------
11,012
--------------
See notes to the financial statements.
58
<PAGE>
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
April 30, 2000
(Unaudited)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
DISTRIBUTION 0.0%
9,358 Ikon Office Solutions, Inc. $ 55
--------------
DIVERSIFIED 0.3%
8,100 Danaher Corporation 463
35,410 Unilever N.V. 1,613
--------------
2,076
--------------
DRUGS 7.9%
96,000 Abbott Laboratories 3,690
8,000 Allergan, Inc. 471
6,000 Alza Corporation<F1> 264
84,300 American Home Products Corporation 4,737
3,100 Bard (C.R.), Inc. 135
18,100 Baxter International, Inc. 1,179
14,400 Becton, Dickinson & Company 369
9,300 Biogen, Inc.<F1> 547
128,340 Bristol-Myers Squibb Company 6,730
16,850 Cardinal Health, Inc. 928
68,100 Eli Lilly & Company 5,265
9,500 Humana, Inc.<F1> 73
89,500 Johnson & Johnson 7,384
74,700 Medtronic, Inc. 3,880
150,700 Merck & Company, Inc. 10,474
249,900 Pfizer, Inc. 10,527
76,412 Pharmacia & Upjohn, Inc. 3,816
5,400 St. Jude Medical, Inc.<F1> 168
91,800 Schering-Plough 3,701
18,800 Tenet Healthcare Corporation<F1> 479
5,800 Watson Pharmaceuticals, Inc.<F1> 261
--------------
65,078
--------------
ELECTRIC 0.7%
12,900 AES Corp. 1,160
7,700 Ameren Corporation 282
9,632 CINenergy Corporation 258
6,900 CMS Energy Corporation 131
13,700 Consolidated Edison Company of New York, Inc. 482
8,950 Constellation Energy Group 296
22,528 Duke Power Company 1,295
20,700 Edison International 395
6,700 Florida Progress Corporation 328
7,600 General Public Utilities Corporation 213
5,300 Pinnacle West Capital Corporation 186
16,600 Texas Utilities Company 559
--------------
5,585
--------------
ELECTRICAL EQUIPMENT 4.5%
27,000 Emerson Electric Company 1,482
211,900 General Electric Company 33,321
5,600 Grainger (W.W.), Inc. 243
41,600 Solectron Corporation<F1> 1,947
--------------
36,993
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
ELECTRONICS 6.6%
23,200 Analog Devices<F1> $ 1,782
63,300 Hewlett-Packard Company 8,545
215,600 Intel Corporation 27,341
8,100 Lexmark International Group, Inc.<F1> 956
12,250 Molex Incorporated 673
45,752 Motorola, Inc. 5,447
10,000 National Semiconductor Corporation<F1> 607
3,450 Tektronix, Inc. 200
51,500 Texas Instruments, Inc. 8,388
3,400 Thomas & Betts Corporation 105
--------------
54,044
--------------
ENERGY 1.1%
10,900 American Electric Power Company 399
9,000 Carolina Power & Light Company 329
12,700 Central & South West Corporation 275
12,650 Coastal Corporation 635
18,422 Dominion Resources, Inc. 829
8,900 DTE Energy Company 290
14,300 El Paso Energy Corporation 608
14,900 Entergy Corporation 379
14,100 FirstEnergy Corp. 359
11,700 FPL Group, Inc. 529
6,800 New Century Energies, Inc. 222
11,600 Niagara Mohawk Power Corporation<F1> 161
3,300 NICOR, Inc. 112
9,000 Northern States Power Company 196
23,800 Pacific Gas & Electric Company 617
13,100 Peco Energy Company 546
13,100 Public Service Enterprises Group, Inc. 470
17,672 Reliant Energy, Inc. 471
14,017 Sempra Energy 260
43,200 Southern Company 1,077
13,200 Unicom Corporation 525
--------------
9,289
--------------
ENERGY - RAW MATERIALS 0.3%
19,990 Baker Hughes, Inc. 636
27,300 Halliburton Company 1,206
20,700 Occidental Petroleum Corporation 444
--------------
2,286
--------------
ENTERTAINMENT & LEISURE 0.9%
7,700 Brunswick Corporation 148
38,000 Carnival Corporation 945
12,187 Hasbro, Inc. 194
24,387 Mattel, Inc. 299
84,100 McDonald's Corporation 3,206
11,800 Mirage Resorts, Incorporated<F1> 240
42,770 Viacom, Inc. - Class B<F1> 2,326
8,050 Wendy's International, Inc. 180
--------------
7,538
--------------
See notes to the financial statements.
59
<PAGE>
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
ENVIRONMENTAL SERVICES 0.0%
22,100 Laidlaw, Inc. - Class B $ 19
--------------
FINANCE 1.1%
28,000 American Express Company 4,202
7,717 Bear Stearns Companies, Inc. 331
29,706 Household International, Inc. 1,240
7,200 Lehman Brothers Holdings, Inc. 591
22,800 Merrill Lynch & Company, Inc. 2,324
38,200 National City Corporation 649
--------------
9,337
FINANCIAL SERVICES 2.1%
45,090 Associates First Capital Corporation - Class A 1,000
12,200 Capital One Financial Corp. 534
18,815 Conseco, Inc. 102
6,600 Countrywide Credit Industries, Inc. 182
63,500 Federal National Mortgage Association 3,830
15,000 Franklin Resources, Inc. 484
6,500 Kansas City Southern Industries 467
6,000 MBIA, Inc. 297
49,662 MBNA Corporation 1,319
70,732 Morgan Stanley Group, Inc. 5,429
8,700 Paine Webber 382
9,700 SLM Holding Corporation 304
50,600 The Charles Schwab Corporation 2,252
7,300 T. Rowe Price Associates, Inc. 278
--------------
16,860
--------------
FOOD, BEVERAGES & TOBACCO 3.0%
36,758 Archer-Daniels-Midland Company 365
16,800 Bestfoods 844
27,000 Campbell Soup Company 702
159,600 Coca-Cola Company 7,511
26,300 Coca-Cola Enterprises 561
30,250 ConAgra, Inc. 571
9,800 Dardeen Restaurants, Inc. 181
10,000 Fortune Brands, Inc. 250
18,000 General Mills, Inc. 655
2,400 Great Atlantic & Pacific Tea Company, Inc. 44
22,300 Heinz (H.J.) Company 758
8,300 Hershey Foods Corporation 377
25,100 Kellogg Company 613
23,900 Lowe's Companies, Inc 1,183
91,500 PepsiCo, Inc. 3,357
149,400 Philip Morris Companies, Inc. 3,268
8,000 Quaker Oats Company 522
19,400 Ralston-Ralston Purina Group 343
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
FOOD, BEVERAGES & TOBACCO 3.0% (CONT.)
56,000 Sara Lee Corporation $ 840
20,600 Sysco Corporation 775
9,120 Tricon Global Restaurants, Inc.<F1> 311
10,900 UST, Inc. 163
6,800 Wrigley (Wm) Jr. Company 492
--------------
24,686
--------------
GOLD & PRECIOUS METALS 0.1%
23,200 Barrick Gold Corporation 390
9,600 Freeport McMoRan Copper & Gold, Inc. 92
15,500 Homestake Mining Company 93
19,361 Placer Dome, Inc. 157
--------------
732
--------------
HEALTH CARE SERVICES & SUPPLIES 1.2%
3,400 Bausch & Lomb, Inc. 205
24,500 Boston Scientific Corporation<F1> 649
33,828 Columbia/HCA Healthcare Corporation 962
3,620 Edwards Lifesciences Corporation<F1> 54
25,700 HEALTHSOUTH Corporation<F1> 207
18,842 IMS Health, Inc. 321
6,300 Manor Care, Inc.<F1> 75
16,494 McKesson HBOC, Inc. 278
1,700 Shared Medical Systems Corporation 70
10,900 United Healthcare Corporation 727
53,600 Warner-Lambert Company 6,100
4,300 Wellpoint Health Networks<F1> 317
--------------
9,965
--------------
HOME FURNISHINGS 0.0%
11,700 Leggett & Platt, Inc. 250
--------------
HOSPITAL SUPPLIES & SERVICES 0.0%
6,500 Biomet, Inc. 232
--------------
HOUSEHOLD PRODUCTS 0.1%
12,300 Federated Department Stores<F1> 418
--------------
INSURANCE 2.8%
9,394 Aetna Life and Casualty Company 544
15,900 AFLAC Corporation 776
49,946 Allstate Corporation 1,180
15,500 American General Corporation 868
100,202 American International Group, Inc. 10,991
15,000 Aon Corporation 406
11,000 Chubb Corporation 700
12,600 CIGNA Corporation 1,005
10,200 Cincinnati Financial Corporation 411
13,700 The Hartford Financial Services Group, Inc. 715
6,225 Jefferson-Pilot Corporation 414
26,704 KeyCorp 494
See notes to the financial statements.
60
<PAGE>
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
INSURANCE 2.8% (CONT.)
11,800 Lincoln National Corporation $ 411
16,260 Marsh & McLennan Companies, Inc. 1,603
6,400 MGIC Investment Corporation 306
4,300 Progressive Corporation 281
8,800 Providian Corporation 775
8,100 SAFECO Corporation 179
14,332 St. Paul Companies, Inc. 511
7,900 Torchmark Corporation 198
14,259 UNUM Provident Corporation 242
--------------
23,010
INTERNET SERVICES 1.6%
144,000 America Online, Inc.<F1> 8,613
34,300 Yahoo! Inc.<F1> 4,468
--------------
13,081
LIQUOR 0.5%
29,500 Anheuser-Busch Companies, Inc. 2,082
4,200 Brown-Foreman Corporation - Class B 229
2,300 Adolph Coors Company 117
26,500 Seagram Company Ltd. 1,431
--------------
3,859
--------------
MACHINERY - INDUSTRIAL 0.0%
9,500 Thermo Electron Corporation<F1> 184
--------------
MEDICAL INSTRUMENTS 0.2%
18,700 Guidant Corporation 1,073
12,800 PE Corp-PE Biosystems Group 768
2,900 PerkinElmer, Inc. 159
--------------
2,000
--------------
METALS & MINERALS 0.1%
6,080 Allegheny Teledyne, Inc. 147
1,132 Arch Coal, Inc. 6
5,200 Nucor Corporation 224
18,366 USX Corporation-Marathon Group, Inc. 428
4,793 USX Corporation-US Steel Group, Inc. 120
5,600 Worthington Industries, Inc. 69
--------------
994
--------------
MISCELLANEOUS 1.0%
49,200 Applied Materials, Inc.<F1> 5,009
4,100 Mallinckrodt Group, Inc. 110
9,400 PP&L Resources, Inc. 224
21,000 3 Com Corporation<F1> 828
24,900 3M Corporation 2,154
--------------
8,325
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
MOTORCYCLE 0.1%
18,800 Harley Davidson, Inc. $ 749
--------------
MULTI-INDUSTRY 1.2%
46,141 Cendant Corporation<F1> 712
17,900 Corning, Inc. 3,535
6,500 Loews Corporation 358
1,924 Tenneco, Inc. 17
108,896 Tyco International, Ltd. 5,002
--------------
9,624
--------------
NATURAL GAS 0.4%
46,300 Enron Corporation 3,227
--------------
NETWORKING 0.0%
6,500 Adaptec, Inc.<F1> 175
--------------
NON-FERROUS METALS 0.4%
13,250 Alcan Aluminum Ltd. 434
22,900 Alcoa, Inc. 1,486
8,800 Englehard Corporation 154
11,400 Inco, Ltd. 178
9,436 Newmont Mining Corporation 221
5,100 Phelps Dodge Corporation 236
3,500 Reynolds Metals Company 233
--------------
2,942
--------------
OFFICE EQUIPMENT 0.1%
21,500 Novell, Inc.<F1> 422
--------------
OIL - DOMESTIC 0.5%
5,600 Amerada Hess Corporation 356
7,300 Anadarko Petroleum Corporation 317
4,600 Ashland, Inc. 157
13,592 Burlington Resources, Inc. 534
19,850 Columbia Gas System, Inc. 1,246
5,208 Kerr-McGee Corporation 270
14,900 Phillips Petroleum Company 707
5,200 Rowan Companies, Inc.<F1> 145
5,700 Sun Company, Inc. 173
14,200 Unocal Corporation 459
--------------
4,364
--------------
OIL - INTERNATIONAL 4.2%
7,400 Apache Corporation 358
32,636 BP Amoco PLC 1,664
42,500 Chevron Corporation 3,618
38,400 Conoco, Inc. 955
222,927 Exxon Mobil Corporation 17,319
138,000 Royal Dutch Petroleum Company 7,918
34,500 Texaco, Inc. 1,708
19,663 Transocean Sedco Forex Inc. 924
--------------
34,464
--------------
See notes to the financial statements.
61
<PAGE>
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
OIL & GAS SERVICES 0.4%
1,700 Eastern Enterprises $ 103
3,700 McDermott International, Inc. 30
2,200 Peoples Energy Corporation 68
33,900 Schlumberger, Ltd. 2,595
9,000 Tosco Corporation 289
15,338 Union Pacific Resources Group 294
--------------
3,379
--------------
PAPER & FOREST PRODUCTS 0.7%
3,400 Boise Cascade Corporation 111
5,500 Champion International Corporation 361
13,400 Fort James Corporation 321
10,200 Georgia-Pacific Corporation 375
25,415 International Paper Company 934
34,012 Kimberly-Clark Corporation 1,975
6,372 Louisiana Pacific Corporation 85
6,200 Mead Corporation 216
1,800 Potlatch Corporation 71
3,250 Temple-Inland, Inc. 163
6,825 Westvaco Corporation 211
14,650 Weyerhaeuser Company 783
6,600 Willamette Industries 252
--------------
5,858
--------------
PRINTING & PUBLISHING 0.1%
11,500 McGraw-Hill, Inc. 604
3,200 Meredith Corporation 89
7,300 R.R. Donnelley & Sons Company 155
--------------
848
--------------
PRODUCTION 0.6%
1,400 Briggs & Stratton Corporation 54
22,000 Caterpillar, Inc. 868
5,600 Cooper Industries, Inc. 192
4,100 Crane Co. 110
14,000 Deere & Company 565
13,600 Dover Corporation 691
1,900 FMC Corporation<F1> 111
18,800 Illinois Tool Works, Inc. 1,204
10,300 Ingersoll-Rand Company 483
6,366 Pall Corporation 142
6,525 Parker-Hannifin Corporation 303
4,900 Timken Company 91
--------------
4,814
--------------
RAILROADS 0.2%
27,943 Burlington Northern Santa Fe 674
12,720 CSX Corporation 266
22,200 Norfolk Southern Corporation 391
15,300 Union Pacific Corporation 645
--------------
1,976
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
RETAIL 5.3%
26,043 Albertson's, Inc. $ 848
4,400 American Greetings Corporation 80
7,400 Bed Bath & Beyond, Inc.<F1> 271
12,700 Best Buy<F1> 1,025
12,000 Circuit City Stores, Inc. 706
6,000 Consolidated Stores Corporation<F1> 75
27,242 Costco Companies, Inc.<F1> 1,473
6,600 Dillard Department Stores, Inc. - Class A 92
16,581 Dollar General Corporation 379
53,275 Gap, Inc. 1,958
148,200 Home Depot, Inc. 8,308
28,500 Kmart Corporation<F1> 231
19,400 Kohl's Department Stores<F1> 931
51,200 Kroger Corporation<F1> 950
13,311 The Limited, Inc. 601
2,500 Longs Drug Stores Corporation 58
20,514 The May Department Stores Company<F1> 564
8,400 Nordstrom, Inc. 234
23,400 Office Depot<F1> 247
15,700 JC Penney Company, Inc. 217
3,300 Pep Boys-Manny, Moe & Jack 21
15,400 Rite Aid Corporation 77
30,800 Safeway, Inc.<F1> 1,359
23,600 Sears Roebuck and Company 864
28,750 Staples, Inc.<F1> 548
7,000 Supervalu, Inc. 145
11,400 Tandy Corporation 650
27,400 Target Corporation 1,824
19,000 TJX Companies, Inc. 365
17,025 Toys `R' Us, Inc.<F1> 260
62,000 Walgreen Company 1,744
287,200 Wal-Mart Stores, Inc. 15,904
8,800 Winn-Dixie Stores, Inc. 146
--------------
43,155
--------------
SAVINGS & LOAN 0.3%
43,100 Federal Home Loan Mortgage Corporation 1,980
10,200 Golden West Financial Corporation 348
--------------
2,328
--------------
SEMICONDUCTORS 1.0%
7,500 Advanced Micro Devices, Inc.<F1> 658
12,200 Conexant Systems, Inc.<F1> 730
10,400 KLA-Tencor Corporation<F1> 779
18,600 LSI Logic Corp.<F1> 1,163
16,900 Micron Technology Incorporated 2,353
10,100 Teradyne, Inc.<F1> 1,111
20,000 Xilinx, Inc.<F1> 1,465
--------------
8,259
--------------
See notes to the financial statements.
62
<PAGE>
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
SOFTWARE 3.1%
7,200 Adobe Systems Incorporated $ 871
10,800 Citrix Systems, Inc.<F1> 659
22,800 Compuware Corporation<F1> 286
328,900 Microsoft Corporation<F1> 22,941
16,200 Parametric Technology Company<F1> 132
16,800 Peoplesoft, Inc.<F1> 234
--------------
25,123
--------------
STEEL 0.0%
8,200 Bethlehem Steel Corporatio<F1> 44
--------------
TELECOMMUNICATIONS 8.8%
18,600 ADC Telecommunications, Inc.<F1> 1,130
19,600 Alltell Corporation 1,306
206,342 AT&T Corporation 9,634
100,508 Bell Atlantic Corporation 5,955
121,600 BellSouth Corp. 5,920
10,300 Cabletron Systems<F1> 236
8,300 CenturyTel, Inc. 203
47,420 Global Crossing Ltd.<F1> 1,494
62,700 GTE Corporation 4,248
201,779 Lucent Technologies, Inc. 12,548
183,170 MCI Worldcom, Inc. 8,323
22,700 Nextel Communications, Inc.<F1> 2,484
220,007 SBC Communications, Inc. 9,639
9,000 Scientific-Atlanta, Inc. 585
54,400 Sprint Corporation 3,346
54,500 Sprint PCS Group 2,998
31,145 US West, Inc. 2,217
--------------
72,266
--------------
TELECOMMUNICATIONS EQUIPMENT 2.1%
10,400 Comverse Technology, Inc.<F1> 928
91,160 Nortel Networks Corporation 10,324
45,500 Qualcomm, Inc.<F1> 4,934
25,100 Tellabs, Inc.<F1> 1,376
--------------
17,562
--------------
TEXTILES & APPAREL 0.3%
24,200 CVS Corporation 1,053
3,600 Liz Claiborne, Inc. 167
17,400 Nike, Inc. - Class B 756
1,100 Springs Industries, Inc. 45
7,454 VF Corporation 210
--------------
2,231
--------------
TIRE & RUBBER 0.1%
4,800 Cooper Tire & Rubber Company 65
6,800 Goodrich (B.F.) Company 217
9,262 Goodyear Tire & Rubber Company 256
--------------
538
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
TRANSPORTATION EQUIPMENT 0.0%
2,500 Cummins Engine Company, Inc. $ 89
--------------
TRAVEL & RECREATION 0.9%
132,800 The Walt Disney Company 5,752
7,150 Harrahs Entertainment, Inc.<F1> 147
23,000 Hilton Hotels Corporation 195
14,900 Marriott International, Inc. - Class A 477
15,532 Sabre Holding Corporation<F1> 543
--------------
7,114
--------------
TRUCKING 0.0%
3,550 Ryder System, Inc. 79
--------------
WASTE MANAGEMENT 0.0%
11,800 Allied Waste Industries, Inc.<F1> 72
37,740 Waste Management, Inc. 599
--------------
671
--------------
Total Common Stock (Cost $392,136) 780,617
--------------
PRINCIPAL
AMOUNT
(IN THOUSANDS)
--------------
SHORT-TERM INVESTMENTS 5.2%
U.S. Treasuries 0.4%
$ 3,600 U.S. Treasury Bill, 0.00%, 5/25/00 3,587
--------------
Total U.S. Treasuries (Cost $3,587) 3,587
--------------
Variable Rate Demand Notes 4.8%
16,453 American Family Financial Services, Inc. 16,453
22,703 Warner-Lambert Company 22,703
--------------
Total Variable Rate Demand Notes (Cost $39,157) 39,156
--------------
Total Short-Term Investments (Cost $42,743) 42,743
--------------
Total Investments (Cost $434,879) 100.2% 823,360
--------------
Liabilities, less Other Assets (0.2)% (1,713)
--------------
TOTAL NET ASSETS 100.0% $821,647
==============
<F1> Non-income producing
See notes to the financial statements.
63
<PAGE>
GROWTH FUND
SCHEDULE OF INVESTMENTS
April 30, 2000
(Unaudited)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMON STOCKS 98.1%
AEROSPACE & AIRCRAFT 0.6%
38,500 General Dynamics Corporation $ 2,252
--------------
AIR TRANSPORTATION 0.6%
100,700 Southwest Airlines 2,184
--------------
BANKING 3.8%
45,600 Chase Manhattan Corporation 3,286
54,000 Fifth Third Bancorp 3,409
79,300 State Street Corporation 7,682
--------------
14,377
--------------
BEVERAGES 0.6%
56,000 PepsiCo, Inc. 2,055
--------------
BUSINESS SERVICES 4.4%
41,900 Computer Sciences Corporation<F1> 3,418
154,900 First Data Corporation 7,542
71,400 Sabre Group Holdings, Inc.<F1> 2,495
85,800 SunGard Data Systems, Inc.<F1> 2,965
--------------
16,420
--------------
COMMUNICATIONS & MEDIA 4.9%
125,500 Charter Communications,Inc.<F1> 1,843
89,200 Infinity Broadcasting 3,027
110,300 Interpublic Group of Companies, Inc. 4,522
57,400 Omnicom Group, Inc. 5,227
88,200 Walt Disney Company 3,820
--------------
18,439
--------------
COMPUTERS 4.2%
41,700 ASM Lithography Holding N.V.<F1> 1,668
47,600 EMC Corporation<F1> 6,613
61,400 Sun Microsystems, Inc. 5,645
16,800 VERITAS Software Corporation<F1> 1,802
--------------
15,728
--------------
DRUGS 8.3%
61,000 Bristol-Myers Squibb Company 3,199
95,000 Eli Lilly & Company 7,345
12,100 Genentech, Inc.<F1> 1,416
46,500 Johnson & Johnson 3,836
53,700 Merck & Co., Inc. 3,732
83,100 Warner-Lambert Company 9,458
50,900 Watson Pharmaceuticals, Inc.<F1> 2,287
--------------
31,273
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
ELECTRONIC COMPONENTS & SEMICONDUCTORS 13.8%
36,400 Analog Devices, Inc.<F1> $ 2,796
62,700 Applied Materials, Inc.<F1> 6,384
14,000 Broadcom Corporation<F1> 2,413
35,300 Conexant Systems, Inc.<F1> 2,114
33,800 Flextronics International Ltd.<F1> 2,374
52,700 Infineon Technologies AG<F1> 3,577
65,100 Intel Corporation 8,255
76,237 Molex, Inc. - Class A 3,049
17,900 PMC - Sierra, Inc.<F1> 3,435
17,800 STMicroelectronics N.V. 3,376
20,400 Teradyne, Inc.<F1> 2,244
72,200 Texas Instruments Incorporated 11,760
--------------
51,777
--------------
FINANCIAL SERVICES 4.6%
47,700 Federal Home Loan Mortgage Corporation 2,191
25,000 Federal National Mortgage Association 1,508
81,400 Franklin Resources, Inc. 2,625
207,825 MBNA Corporation 5,520
71,700 Morgan Stanley Dean Witter & Company 5,503
--------------
17,347
--------------
HEALTH CARE SERVICES & SUPPLIES 1.7%
67,150 Cardinal Health, Inc. 3,697
157,700 IMS Health Incorporated 2,691
--------------
6,388
--------------
INSURANCE 4.0%
63,250 AFLAC, Inc. 3,087
64,282 American International Group 7,051
32,300 Aon Corporation 874
85,200 MGIC Investment Corporation 4,074
--------------
15,086
--------------
INTERNET PRODUCTS & SERVICES 0.3%
15,400 Ariba, Inc.<F1> 1,143
--------------
MEDICAL INSTRUMENTS 1.7%
31,600 Guidant Corporation 1,813
84,800 Medtronic, Inc. 4,404
--------------
6,217
--------------
MULTI-INDUSTRY 2.1%
167,300 Tyco International, Ltd. 7,685
--------------
NETWORKING PRODUCTS 4.6%
168,700 Cisco Systems, Inc.<F1> 11,696
6,300 Juniper Networks, Inc.<F1> 1,340
54,400 Network Appliance, Inc.<F1> 4,022
--------------
17,058
--------------
See notes to the financial statements.
64
<PAGE>
GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
OIL & GAS - DOMESTIC 2.3%
158,500 EOG Resources,Inc. $ 3,943
45,300 Phillips Petroleum Company 2,149
54,100 Texaco,Inc. 2,678
--------------
8,770
--------------
OIL & GAS SERVICES 3.8%
87,300 Enron Corporation<F1> 6,084
65,900 Halliburton Company 2,912
70,400 Schlumberger Limited 5,390
--------------
14,386
--------------
PAPER & FOREST PRODUCTS 0.5%
30,200 Champion International Corporation 1,986
--------------
RETAIL 11.5%
63,200 Circuit City Stores, Inc. 3,717
68,000 Costco Companies, Inc.<F1> 3,676
88,200 Dollar General Corporation 2,018
61,300 Home Depot, Inc. 3,437
96,200 Kohl's Corporation<F1> 4,618
128,500 Lowe's Companies, Inc. 6,361
142,200 Safeway, Inc.<F1> 6,275
53,100 Target Corporation 3,534
134,400 Walgreen Company 3,780
101,200 Wal-Mart Stores, Inc. 5,604
--------------
43,020
--------------
SOFTWARE 3.6%
20,300 Citrix Systems, Inc.<F1> 1,240
123,800 Microsoft Corporation<F1> 8,635
47,100 Oracle Corporation<F1> 3,765
--------------
13,640
--------------
TELECOMMUNICATIONS 5.5%
27,800 ALLTEL Corporation 1,852
20,200 AT&T Wireless Group<F1> 643
69,100 Broadwing,Inc.<F1> 2,024
44,300 Global Crossing Ltd.<F1> 1,395
93,472 MCI WorldCom, Inc.<F1> 4,247
31,300 Nextel Communications, Inc.<F1> 3,425
16,600 VoiceStream Wireless Corporation<F1> 1,643
--------------
15,229
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
TELECOMMUNICATIONS EQUIPMENT 8.7%
27,400 CIENA Corporation<F1> $ 3,387
20,600 Comverse Technology, Inc.<F1> 1,837
9,100 Corning Incorporated 1,797
21,400 Ericsson AB 1,893
51,100 JDS Uniphase Corporation<F1> 5,298
14,600 Motorola, Inc. 1,738
112,200 Nokia Corporation - ADR 6,381
83,000 Nortel Networks Corporation 9,400
40,400 Scientific-Atlanta, Inc. 2,629
30,200 Qualcomm, Inc.<F1> 3,275
--------------
37,635
--------------
TRANSPORTATION 1.2%
110,400 Harley-Davidson, Inc. 4,395
--------------
TRAVEL & RECREATION 0.8%
125,800 Carnival Corporation - Class A 3,129
--------------
Total Common Stock (Cost $237,195) 367,619
--------------
Number
of Shares
(in thousands)
--------------
SHORT-TERM INVESTMENTS 3.4%
INVESTMENT COMPANIES 3.4%
67 Financial Square Prime Obligation Fund 67
12,806 Short-Term Investments Co. Liquid Assets Portfolio 12,806
--------------
Total Investment Companies (Cost $12,873) 12,873
--------------
Total Short-Term Investments (Cost $12,873) 12,873
--------------
Total Investments (Cost $250,068) 101.5% 380,492
--------------
Liabilities, less Other Assets (1.5)% (5,751)
--------------
TOTAL NET ASSETS 100.0% $374,741
==============
<F1> Non-income producing
See notes to the financial statements.
65
<PAGE>
MIDCAP INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMON STOCKS 91.5%
AEROSPACE & AIRCRAFT 0.5%
3,800 Cordant Technologies, Inc. $ 215
4,700 Litton Industries, Inc.<F1> 204
1,000 Sequa Corporation 49
--------------
468
--------------
AUTOS & TRUCKS 0.6%
2,300 Arvin Industries, Inc. 50
2,600 Borg-Warner Automotive, Inc. 109
7,600 Federal-Mogul Corporation 103
6,900 Lear Corporation<F1> 206
6,400 Meritor Automotive, Inc. 96
2,800 Superior Industries International,Inc. 90
--------------
654
--------------
BANKING 4.0%
6,600 Associated Banc-Corp 169
4,100 CCB Financial Corporation 162
4,900 City National Corporation 180
11,700 Compass Bancshares, Inc. 216
20,200 First Security Corporation 285
13,400 First Tennessee National Corporation 255
5,100 First Virginia Banks, Inc. 186
9,300 FirstMerit Corporation 152
16,500 Hibernia Corporation 175
5,000 Keystone Financial, Inc. 75
10,900 Marshall & Ilsley Corporation 506
7,100 Mercantile Bankshares Corporation 202
11,100 National Commerce Bancorporation 182
18,100 North Fork Bancorporation, Inc. 293
8,200 Pacific Century Financial Corporation 169
5,000 Provident Financial Group 147
8,500 TCF Financial Corporation 199
3,900 Westamerica Bancorporation 98
3,400 Wilmington Trust Corporation 157
8,800 Zions Bancorporation 365
--------------
4,173
--------------
BIOTECHNOLOGY 1.0%
18,700 Chiron Corporation<F1> 846
2,900 Incyte Pharmaceuticals, Inc.<F1> 223
--------------
1,069
--------------
BUILDING & CONSTRUCTION 0.2%
14,400 Clayton Homes, Inc. 137
2,800 Granite Construction, Inc. 66
--------------
203
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
BUILDING MATERIALS 0.9%
7,300 American Standard Companies, Inc.<F1> $ 299
4,800 Martin Marietta Materials, Inc. 254
3,700 Southdown, Inc. 215
5,000 USG Corporation 209
--------------
977
--------------
BUSINESS SERVICES 4.6%
6,000 ACNielson Corporation<F1> 138
4,500 Avnet, Inc. 354
17,200 Cintas Corporation 681
15,800 Comdisco, Inc. 491
21,200 Concord EFS, Inc.<F1> 474
15,800 Convergys Corporation<F1> 695
9,100 Gartner Group, Inc.<F1> 98
7,100 Harte-Hanks,Inc. 176
2,700 Jacobs Engineering Group, Inc.<F1> 85
7,400 Keane, Inc.<F1> 214
3,700 Kelly Services, Inc. - Class A 87
7,800 Manpower, Inc. 275
9,900 Modis Professional Services, Inc.<F1> 75
4,600 Navigant Consulting, Inc.<F1> 46
2,300 NCO Group, Inc.<F1> 79
9,300 Robert Half International, Inc. 568
9,800 Viad Corporation 249
--------------
4,785
--------------
CHEMICALS 2.2%
6,300 Airgas, Inc.<F1> 37
4,500 Albemarle Corporation 94
12,300 CK Witco Corporation 144
6,900 Cabot Corporation 186
4,300 Cytec Industries, Inc.<F1> 130
7,800 Ethyl Corporation 24
3,200 Ferro Corporation 73
1,200 H.B. Fuller Company 46
3,200 Georgia Gulf Corporation 77
5,700 The Lubrizol Corporation 146
12,100 Lyondell Chemical Company 222
5,700 M.A. Hanna Company 66
2,200 Minerals Technologies, Inc. 102
4,400 Olin Corporation 78
3,800 A. Schulman, Inc. 49
11,300 Solutia, Inc. 154
6,400 Waters Corporation<F1> 606
3,800 Wellman, Inc. 81
--------------
2,315
--------------
See notes to the financial statements.
66
<PAGE>
MIDCAP INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMUNICATIONS & MEDIA 2.6%
12,100 A.H. Belo Corporation $ 202
3,699 Chris-Craft Industries, Inc.<F1> 227
5,600 Hispanic Broadcasting Corporation<F1> 566
2,800 Media General, Inc. 138
10,500 Univision Communications, Inc.<F1> 1,147
11,400 Westwood One, Inc.<F1> 403
--------------
2,683
--------------
COMPUTERS 0.3%
16,600 Quantum Corporation<F1> 195
10,300 Storage Technology Corporation<F1> 134
--------------
329
--------------
COMPUTER SERVICES 2.2%
5,000 Affiliated Computer Services, Inc.<F1> 166
25,000 Cadence Design Systems, Inc.<F1> 420
5,600 Cambridge Technology Partners, Inc.<F1> 62
5,700 CheckFree Holdings Corporation<F1> 290
6,500 DST Systems, Inc.<F1> 482
13,200 SunGard Data Systems, Inc.<F1> 456
4,300 Sykes Enterprises, Inc.<F1> 86
7,100 Synopsys, Inc.<F1> 298
--------------
2,260
--------------
CONSUMER PRODUCTS 0.7%
4,900 Blyth Industries, Inc. 145
4,600 Carter-Wallace, Inc. 102
10,800 The Dial Corporation 150
10,400 Energizer Holdings, Inc.<F1> 177
8,000 Pennzoil-Quaker State Company 88
10,100 RPM, Inc. 102
--------------
764
--------------
COSMETICS & SOAP 0.1%
4,000 Church & Dwight Companies, Inc. 72
--------------
DATA PROCESSING 1.5%
9,000 Acxiom Corporation<F1> 243
5,400 CSG Systems International, Inc.<F1> 249
12,700 Fiserv, Inc.<F1> 583
27,700 Informix Corporation<F1> 305
7,800 The Reynolds & Reynolds Company - Class A 185
--------------
1,565
--------------
DISTRIBUTION 0.9%
9,900 Arrow Electronics, Inc. 434
3,900 Fastenal Company 228
5,400 Tech Data Corporation<F1> 226
--------------
888
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
DRUGS 4.4%
13,800 Bergen Brunswig Corporation $ 69
8,600 Forest Laboratories, Inc.<F1> 723
4,500 Gilead Sciences, Inc.<F1> 244
8,000 ICN Pharmaceuticals, Inc. 202
16,350 IVAX Corporation 448
6,900 MedImmune, Inc.<F1> 1,104
9,200 Millennium Pharmaceuticals, Inc.<F1> 730
13,300 Myland Laboratories, Inc. 377
6,600 Perrigo Company<F1> 38
6,800 Sepracor, Inc.<F1> 626
--------------
4,561
--------------
ELECTRIC 6.5%
11,300 Allegheny Energy, Inc. 343
8,100 Alliant Energy Corporation 243
1,900 Black Hills Corporation 44
6,500 Calpine Corporation<F1> 595
2,400 Cleco Corporation 83
3,000 CMP Group, Inc. 87
9,600 Conectiv, Inc. 170
14,800 DPL, Inc. 344
7,700 DQE, Inc. 295
12,800 Energy East Corporation 267
3,000 Hawaiian Electric Industries, Inc. 111
3,900 IDACORP, Inc. 144
8,900 IPALCO Enterprises, Inc. 182
6,400 Kansas City Power & Light Company 164
13,400 LG&E Energy Corporation 312
7,500 Minnesota Power, Inc. 138
11,300 The Montana Power Company 498
12,900 NiSource, Inc. 239
14,700 Northeast Utilities 316
6,200 NSTAR 273
8,000 OGE Energy Corporation 159
12,300 Potomac Electric Power Company 288
3,700 Public Service Company of New Mexico 67
8,800 Puget Sound Energy, Inc. 209
10,669 SCANA Corporation 276
7,300 Sierra Pacific Resources 110
13,300 TECO Energy, Inc. 291
9,600 Utilicorp United Inc. 185
5,700 Vectren Corporation 115
12,100 Wisconsin Energy Corporation 259
--------------
6,807
--------------
See notes to the financial statements.
67
<PAGE>
MIDCAP INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
ELECTRONICS 5.1%
19,900 American Power Conversion Corporation<F1> $ 703
3,700 AMETEK, Inc. 76
7,100 Diebold, Inc. 205
6,700 Hubbell, Inc. 175
3,200 L-3 Communications Holdings, Inc.<F1> 170
1,900 MagneTek, Inc.<F1> 16
7,900 Microchip Technology Inc.<F1> 490
14,900 SCI Systems, Inc.<F1> 793
13,100 Sanmina Corporation<F1> 787
4,300 Sawtek, Inc.<F1> 206
7,900 Sensormatic Electronics Corporation<F1> 132
13,800 Symbol Technologies, Inc. 769
4,600 UCAR International, Inc.<F1> 61
8,800 Vishay Intertechnology, Inc.<F1> 738
--------------
5,321
--------------
ENTERTAINMENT & LEISURE 1.3%
7,800 Callaway Golf Company 130
4,400 GTECH Holdings Corporation<F1> 91
7,500 International Game Technology<F1> 183
5,500 International Speedway Corporation 237
9,400 Mandalay Resort Group<F1> 177
31,400 Park Place Entertainment Corporation<F1> 402
8,000 Premier Parks, Inc. 173
--------------
1,393
--------------
FINANCIAL SERVICES 1.6%
9,200 A.G. Edwards, Inc. 346
29,800 E*TRADE Group, Inc.<F1> 641
5,900 The FINOVA Group, Inc. 76
3,200 Investment Technology Group, Inc. 120
6,000 Legg Mason, Inc. 227
7,600 NOVA Corporation<F1> 240
--------------
1,650
--------------
FOOD, BEVERAGES & TOBACCO 2.4%
3,500 Dean Foods Company 86
5,800 Dole Food Company, Inc. 102
2,600 Dreyer's Grand Ice Cream, Inc. 62
10,300 Flowers Industries, Inc. 157
4,300 Hannaford Brothers Company 311
14,700 Hormel Foods Corporation 224
11,000 IBP, Inc. 182
1,200 International Multifoods Corporation 15
7,000 Interstate Bakeries Corporation 89
2,800 Lance, Inc. 30
7,300 McCormick & Company, Inc. 228
11,300 R.J. Reynolds Tobacco Holding, Inc. 234
3,900 Ruddick Corporation 45
2,600 The J.M. Smucker Company 42
3,200 Suiza Foods Corporation<F1> 125
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
FOOD, BEVERAGES & TOBACCO 2.4% (CONT.)
23,300 Tyson Foods, Inc. - Class A $ 243
2,800 Universal Corporation 53
4,700 Universal Foods Corporation 77
2,800 Vlasic Foods International, Inc.<F1> 5
14,500 Whitman Corporation 166
--------------
2,476
--------------
HEALTH CARE SERVICES & SUPPLIES 2.0%
5,400 Apria Healthcare Group, Inc.<F1> 75
9,600 Beverly Enterprises, Inc.<F1> 32
5,200 Covance Inc.<F1> 48
4,000 Express Scripts, Inc.<F1> 143
5,000 First Health Group Corporation<F1> 152
11,400 Foundation Health Systems, Inc.<F1> 115
8,600 Genzyme Corporation<F1> 420
24,800 Health Management Associates, Inc. - Class A<F1> 395
6,300 Hillenbrand Industries, Inc. 190
5,600 Lincare Holdings, Inc.<F1> 171
9,400 Omnicare, Inc. 143
6,300 Quorum Health Group, Inc.<F1> 67
7,600 Total Renal Care Holdings, Inc.<F1> 22
4,000 Trigon Healthcare, Inc.<F1> 144
--------------
2,117
--------------
HOME FURNISHINGS 0.2%
5,000 Furniture Brands International, Inc.<F1> 93
6,300 Mohawk Industries, Inc.<F1> 156
--------------
249
--------------
INSURANCE 2.7%
5,600 Allmerica Financial Corporation 303
7,200 Ambac Financial Group, Inc. 346
6,000 American Financial Group, Inc. 153
4,800 Everest Re Group, Ltd. 140
2,800 HSB Group, Inc. 81
3,700 Horace Mann Educators Corporation 54
6,200 Ohio Casualty Corporation 103
13,000 Old Republic International Corporation 185
8,400 Oxford Health Plans, Inc.<F1> 160
4,500 PacifiCare Health Systems, Inc.<F1> 231
4,600 The PMI Group, Inc. 223
6,600 Protective Life Corporation 157
9,200 ReliaStar Financial Corporation 396
7,300 Unitrin, Inc. 246
--------------
2,778
--------------
MACHINERY - AGRICULTURE & AUTOMOBILES 0.1%
6,550 AGCO Corporation 78
--------------
See notes to the financial statements.
68
<PAGE>
MIDCAP INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
MACHINERY - INDUSTRIAL 0.7%
2,836 Albany International Corporation $ 43
3,300 Flowserve Corporation 47
3,400 Imation Corporation<F1> 95
2,900 Kennametal, Inc. 83
1,500 Nordson Corporation 67
3,200 SPX Corporation 352
2,600 Stewart & Stevenson Services, Inc. 31
--------------
718
--------------
MANUFACTURING 1.2%
3,100 Carlisle Companies Inc. 128
5,100 Federal Signal Corporation 104
4,100 Harsco Corporation 122
3,200 Kaydon Corporation 75
4,100 Lancaster Colony Corporation 108
4,100 Mark IV Industries, Inc. 87
2,600 Modine Manufacturing Company 57
500 NCH Corporation 22
4,900 Pentair, Inc. 187
2,600 Precision Castparts Corporation 109
2,000 Tecumseh Products Company - Class A 93
3,900 Teleflex, Inc. 135
3,700 Trinity Industries, Inc. 82
--------------
1,309
--------------
MEDICAL INSTRUMENTS 2.0%
2,500 Acuson Corporation<F1> 31
3,000 Beckman Coulter,Inc. 194
5,500 DENTSPLY International, Inc. 160
6,000 Edwards Lifesciences Corporation<F1> 90
3,200 MiniMed, Inc.<F1> 393
5,900 PSS World Medical, Inc.<F1> 51
6,000 STERIS Corporation<F1> 54
10,000 Stryker Corporation 719
10,700 Sybron International Corporation<F1> 333
6,600 VISX, Inc.<F1> 104
--------------
2,129
--------------
METALS & MINERALS 0.2%
11,400 AK Steel Holding Corporation 126
2,000 Carpenter Technology Corporation 40
1,000 Cleveland-Cliffs, Inc. 25
500 MAXXAM, Inc.<F1> 14
1,600 Oregon Steel Mills, Inc. 5
2,300 Ryerson Tull, Inc. 28
--------------
238
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
MISCELLANEOUS 0.8%
4,700 Donaldson Company, Inc. $ 109
11,700 IMC Global, Inc. 181
2,800 Rollins, Inc. 40
6,100 Sotheby's Holdings, Inc. 101
9,700 Stewart Enterprises, Inc. 47
5,300 Titan Corporation<F1> 228
4,100 York International Corporation 99
--------------
805
--------------
MULTI-INDUSTRY 0.3%
4,000 Alexander & Baldwin,Inc. 84
2,400 The Dexter Corporation 132
4,400 Ogden Corporation 43
4,600 Pittston Brink's Group 75
--------------
334
--------------
OFFICE EQUIPMENT & SUPPLIES 0.4%
8,100 Herman Miller, Inc. 222
6,200 HON INDUSTRIES, Inc. 155
2,600 The Standard Register Company 34
3,800 Wallace Computer Services, Inc. 42
--------------
453
--------------
OIL - DOMESTIC 0.2%
5,100 Helmerich & Payne, Inc. 160
--------------
OIL - INTERNATIONAL 2.4%
8,900 Devon Energy Corporation 429
4,600 Murphy Oil Corporation 271
14,300 Nabors Industries, Inc.<F1> 564
5,900 Noble Affiliates, Inc. 213
13,500 Noble Drilling Corporation<F1> 539
17,200 Ocean Energy Inc.<F1> 223
9,600 Pioneer Natural Resources Company 99
18,900 Santa Fe Snyder Corporation<F1> 174
--------------
2,512
--------------
OIL & GAS SERVICES 5.8%
5,300 AGL Resources, Inc. 93
7,800 BJ Services Company<F1> 548
14,400 Dynegy, Inc. 942
14,100 ENSCO International, Inc. 468
17,900 Global Marine, Inc.<F1> 430
22,250 Grant Prideco, Inc.<F1> 428
3,000 Hanover Compressor Company<F1> 175
13,800 KeySpan Corporation 405
11,600 Kinder Morgan, Inc. 352
8,900 MCN Energy Group, Inc. 222
See notes to the financial statements.
69
<PAGE>
MIDCAP INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
OIL & GAS SERVICES 5.8% (CONT.)
4,000 National Fuel Gas Company $ 190
8,400 Questar Corporation 158
5,000 Smith International, Inc.<F1> 380
5,800 Tidewater, Inc. 173
9,000 Ultramar Diamond Shamrock Corporation 223
5,800 Valero Energy Corporation 168
6,700 Varco International, Inc. 84
4,700 Washington Gas Light Company 120
11,100 Weatherford International, Inc.<F1> 451
--------------
6,010
--------------
PAPER & FOREST PRODUCTS 1.4%
5,400 Bowater, Inc. 297
1,900 Chesapeake Corporation 59
9,400 Consolidated Papers, Inc. 356
8,500 Georgia-Pacific Corporation 197
5,400 Longview Fibre Company 69
2,800 Rayonier, Inc. 131
3,800 P.H. Glatfelter Company 41
10,500 Sonoco Products Company 219
4,600 Wausau-Mosinee Paper Corporation 56
--------------
1,425
--------------
PRINTING & PUBLISHING 1.3%
2,400 Banta Corporation 47
3,200 Houghton Mifflin Company 133
4,500 Lee Enterprises, Inc. 102
11,000 Reader's Digest Association, Inc. 352
1,600 Scholastic Corporation<F1> 75
5,800 Valassis Communications, Inc.<F1> 198
900 The Washington Post Company - Class B 439
--------------
1,346
--------------
RESTAURANTS 1.2%
3,500 Bob Evans Farms, Inc. 46
6,700 Brinker International, Inc.<F1> 214
3,200 Buffets, Inc.<F1> 31
5,300 CBRL Group, Inc. 74
3,100 Lone Star Steakhouse & Saloon, Inc. 37
7,700 Outback Steakhouse, Inc.<F1> 252
3,100 Papa John's International, Inc.<F1> 85
18,900 Starbucks Corporation<F1> 571
--------------
1,310
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
RETAIL 3.4%
9,900 Abercrombie & Fitch Company<F1> $ 109
4,800 American Eagle Outfitters, Inc.<F1> 82
7,600 BJ's Wholesale Club, Inc.<F1> 269
7,100 Barnes & Noble, Inc.<F1> 131
7,900 Borders Group, Inc.<F1> 125
4,400 CDW Computer Centers, Inc.<F1> 458
4,900 Claire's Stores, Inc. 90
6,400 Dollar Tree Stores, Inc.<F1> 370
17,800 Family Dollar Stores, Inc. 339
4,800 Helig-Meyers Company 15
3,100 Lands' End, Inc.<F1> 131
5,000 Neiman Marcus Group, Inc. 129
11,700 OfficeMax, Inc.<F1> 66
2,900 Payless ShoeSource, Inc.<F1> 160
9,200 Ross Stores, Inc. 191
14,800 Saks, Inc.<F1> 169
7,400 Tiffany & Company 538
5,800 Williams-Sonoma, Inc.<F1> 201
--------------
3,573
--------------
SAVINGS & LOAN 1.2%
5,600 Astoria Financial Corporation 154
21,800 Charter One Financial, Inc. 443
11,400 Dime Bancorp, Inc. 214
11,100 GreenPoint Financial Corporation 207
22,500 Sovereign Bancorp, Inc. 155
4,200 Webster Financial Corporation 90
--------------
1,263
--------------
SCHOOLS 0.4%
7,800 Apollo Group, Inc.<F1> 226
7,200 DeVry, Inc.<F1> 171
5,300 Sylvan Learning Systems, Inc.<F1> 80
--------------
477
--------------
SEMICONDUCTORS 9.3%
10,500 Altera Corporation<F1> 1,074
22,600 Atmel Corporation<F1> 1,106
6,800 Cirrus Logic, Inc.<F1> 111
11,200 Cypress Semiconductor Corporation<F1> 582
9,700 Integrated Device Technology, Inc.<F1> 466
17,800 Jabil Circuit, Inc.<F1> 729
28,550 Maxim Integrated Products,Inc.<F1> 1,850
4,200 Micrel, Inc.<F1> 363
12,000 Novellus Systems, Inc.<F1> 800
7,500 Qlogic Corporation<F1> 752
4,000 TranSwitch Corporation<F1> 352
3,900 TriQuint Semiconductor, Inc.<F1> 401
16,200 Vitesse Semiconductor Corporation<F1> 1,103
--------------
9,689
--------------
See the notes to the financial statements.
70
<PAGE>
MIDCAP INDEX FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
SHIPBUILDING 0.1%
3,400 Newport News Shipbuilding, Inc. $ 113
--------------
SOFTWARE 6.0%
6,600 Electronic Arts, Inc.<F1> 399
20,100 Intuit, Inc.<F1> 722
8,800 Legato Systems, Inc.<F1> 114
5,000 Macromedia, Inc.<F1> 435
6,600 Mentor Graphics Corporation<F1> 87
14,300 Network Associates, Inc.<F1> 364
3,200 NVIDIA Corporation<F1> 285
3,000 Policy Management Systems Corporation<F1> 40
9,200 Rational Software Corporation<F1> 783
19,900 Siebel Systems, Inc.<F1> 2,445
3,300 Structural Dynamics Research Corporation<F1> 44
8,400 Sybase,Inc.<F1> 170
6,100 Symantec Corporation<F1> 381
3,400 Transaction Systems Architects, Inc.<F1> 55
--------------
6,324
--------------
TELECOMMUNICATIONS 1.3%
22,200 Broadwing, Inc.<F1> 629
5,500 COMSAT Corporation 134
6,400 Telephone and Data Systems, Inc. 653
--------------
1,416
--------------
TELECOMMUNICATIONS EQUIPMENT 1.4%
4,000 ADTRAN, Inc.<F1> 270
3,900 ANTEC Corporation<F1> 210
7,100 Harris Corporation 229
3,400 Polycom, Inc.<F1> 269
2,100 Powerwave Technologies, Inc.<F1> 437
--------------
1,415
--------------
TEXTILES & APPAREL 0.6%
4,200 Burlington Industries, Inc.<F1> 18
12,600 Jones Apparel Group, Inc.<F1> 374
5,300 Unifi, Inc.<F1> 54
5,000 Warnaco Group, Inc. 53
5,500 Westpoint Stevens, Inc. 103
--------------
602
--------------
TIRE & RUBBER 0.1%
2,000 Bandag, Inc. 48
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
TRANSPORTATION 1.0%
5,000 Airborne Freight Corporation $ 107
2,700 Alaska Air Group, Inc.<F1> 78
2,300 Arnold Industries, Inc. 27
4,200 C.H. Robinson Worldwide, Inc. 210
4,900 CNF Transportation, Inc. 137
5,000 GATX Corporation 179
3,300 J.B. Hunt Transport Services, Inc.<F1> 54
3,100 Overseas Shipholding Group, Inc. 81
6,600 Swift Transportation Company, Inc.<F1> 132
4,600 Wisconsin Central Transportation Corporation<F1> 67
--------------
1,072
--------------
UTILITIES 0.2%
10,000 American Water Works, Inc. 227
--------------
Total Common Stock (Cost $87,664) 95,603
--------------
PRINCIPAL
AMOUNT
(IN THOUSANDS)
--------------
SHORT-TERM INVESTMENTS 0.6%
U.S. TREASURIES 0.6%
$ 600 U.S. Treasury Bill, 5.67%, 7/06/00 594
--------------
Total U.S. Treasuries (Cost $594) 594
--------------
VARIABLE RATE DEMAND NOTES 7.8%
3,282 Sara Lee Corporation 3,282
2,321 Warner-Lambert Company 2,321
2,607 American Family Financial Services, Inc. 2,607
--------------
Total Variable Rate Demand Notes (Cost $8,210) 8,210
--------------
Total Short-Term Investments (Cost $8,804) 8,804
--------------
Total Investments (Cost $96,468) 99.9% 104,407
--------------
Other Assets, less Liabilities 0.1% 94
--------------
TOTAL NET ASSETS 100.0% $104,501
==============
<F1> Non-income producing
See notes to the financial statements.
71
<PAGE>
SPECIAL GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMON STOCKS 95.0%
AEROSPACE & AIRCRAFT 2.3%
167,700 General Dynamics Corporation $ 9,810
149,400 Orbital Sciences Corporation<F1> 1,886
--------------
11,696
--------------
BANKING 2.2%
125,300 Charter One Financial, Inc. 2,545
32,300 First Tennessee National Corporation 614
75,465 Marshall & Ilsley Corporation 3,504
76,100 North Fork Bancorporation, Inc. 1,232
47,400 TCF Financial Corporation 1,108
42,800 Zions Bancorporation 1,776
--------------
10,779
--------------
BIOTECHNOLOGY 0.9%
41,300 Chiron Corporation<F1> 1,869
33,800 Millennium Pharmaceuticals, Inc.<F1> 2,683
--------------
4,552
--------------
BUILDING MATERIALS & CONSTRUCTION 0.8%
56,525 Martin Marietta Materials, Inc. 2,996
21,280 Southdown, Inc. 1,237
--------------
4,233
--------------
BUSINESS SERVICES 4.7%
27,700 Checkfree Holdings Corporation<F1> 1,408
85,150 Cintas Group<F1> 3,366
76,600 Diebold, Inc. 2,212
72,400 Manpower, Inc. 2,557
132,700 Robert Half International, Inc. 8,111
76,350 Symbol Technologies, Inc. 4,256
53,200 Viad Corp. 1,350
--------------
23,260
--------------
CHEMICALS 0.3%
31,900 Minerals Technologies, Inc. 1,475
--------------
COMMUNICATIONS & MEDIA 1.7%
182,500 Charter Communications, Inc.<F1> 2,680
26,800 Hispanic Broadcasting Corporation<F1> 2,708
27,200 Univision Communications, Inc.<F1> 2,972
--------------
8,360
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
DATA PROCESSING 3.0%
154,800 Acxiom Corporation<F1> $ 4,179
101,800 Ceridian Corporation 2,208
67,100 ChoicePoint, Inc.<F1> 2,550
30,000 CSG Systems International, Inc.<F1> 1,384
40,200 Shared Medical Systems Corporation 1,666
89,900 Sungard Data Systems, Inc.<F1> 3,107
--------------
15,094
--------------
DISTRIBUTION 0.9%
28,800 CDW Computer Centers, Inc.<F1> 2,995
25,200 Fastenal Company 1,473
--------------
4,468
--------------
DRUGS 3.7%
77,500 Alza Corporation - Class A<F1> 3,415
15,400 C.R. Bard, Inc. 671
39,000 Forest Laboratories, Inc.<F1> 3,278
30,100 MedImmune, Inc.<F1> 4,814
68,700 Mylan Laboratories, Inc. 1,949
20,400 Sepracor, Inc.<F1> 1,877
59,700 Shire Pharmaceuticals Group PLC - ADR<F1> 2,403
--------------
18,407
--------------
ELECTRONICS 14.1%
18,700 Aeroflex, Inc.<F1> 697
64,900 Analog Devices, Inc.<F1> 4,985
11,300 Applied Micro Circuits Corporation<F1> 1,456
95,000 Atmel Corporation<F1> 4,649
15,250 AVX Corporation 1,486
35,900 Conexant Systems, Inc.<F1> 2,150
42,100 Exar Corporation<F1> 3,375
84,000 Flextronics International Ltd.<F1> 5,901
68,350 Integrated Device Technology, Inc.<F1> 3,285
37,800 LSI Logic Corporation<F1> 2,362
142,750 Maxim Integrated Products<F1> 9,252
18,500 Micrel, Inc.<F1> 1,600
68,800 Novellus Systems, Inc.<F1> 4,588
25,700 NVIDIA Corporation<F1> 2,290
60,800 Sanmina Corporation<F1> 3,652
68,800 SCI Systems, Inc.<F1> 3,664
38,100 Semtech Corporation<F1> 2,598
28,100 TriQuint Semiconductor, Inc.<F1> 2,889
84,700 Vitesse Semiconductor Corporation<F1> 5,765
43,900 Xilinx, Inc.<F1> 3,216
--------------
69,860
--------------
See notes to the financial statements.
72
<PAGE>
SPECIAL GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
FINANCIAL SERVICES 5.3%
34,025 The BISYS Group, Inc.<F1> $ 2,129
565,032 Concord EFS, Inc.<F1> 12,643
150,000 E*Trade Group, Inc.<F1> 3,225
183,922 Fiserv, Inc.<F1> 8,449
--------------
26,446
--------------
FOOD - DISTRIBUTION 0.6%
140,900 SUPERVALU, Inc. 2,915
--------------
HEALTH CARE SERVICES & SUPPLIES 4.2%
515,759 Health Management Associates, Inc. - Class A<F1> 8,220
209,960 Lincare Holdings, Inc.<F1> 6,404
12,300 Omnicare, Inc. 187
264,200 Renal Care Group, Inc.<F1> 5,895
--------------
20,706
--------------
INTERNET PRODUCTS & SERVICES 0.5%
10,000 PurchasePro.com, Inc.<F1> 300
53,900 Verio, Inc.<F1> 2,025
--------------
2,325
--------------
INSURANCE 4.7%
41,000 Allmerica Financial Corporation 2,219
73,675 Ambac Financial Group, Inc. 3,536
13,100 Jefferson - Pilot Corporation 878
361,900 MetLife, Inc.<F1> 5,994
40,825 Nationwide Financial Services, Inc. 1,142
29,250 The PMI Group, Inc. 1,417
104,955 Protective Life Corporation 2,499
38,700 ReliaStar Financial Corporation 1,667
38,300 Torchmark Corporation 932
65,800 XL Capital Ltd. - Class A 3,134
--------------
23,418
--------------
MEDICAL INSTRUMENTS 3.7%
110,100 Biomet, Inc. 3,929
45,300 Coherent, Inc.<F1> 2,619
73,400 DENTSPLY International, Inc. 2,133
14,800 MiniMed, Inc.<F1> 1,819
40,600 Stryker Corporation 2,918
154,400 Sybron International Corporation<F1> 4,806
--------------
18,224
METALS & MINERALS 0.3%
127,900 Prudential Steel Ltd. 1,303
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
MULTI-INDUSTRY 0.6%
183,600 Universal Foods Corporation $ 3,018
--------------
NETWORKING PRODUCTS 1.5%
13,200 CIENA Corporation<F1> 1,632
35,100 QLogic Corporation<F1> 3,521
60,775 Xircom, Inc.<F1> 2,395
--------------
7,548
--------------
OIL & GAS - DOMESTIC 2.0%
43,100 Devon Energy Corporation 2,077
308,500 EOG Resources, Inc. 7,674
--------------
9,751
--------------
OIL & GAS SERVICES 8.9%
42,300 BJ Services Company<F1> 2,972
72,975 Dynegy, Inc. - Class A 4,775
76,000 ENSCO International, Inc. 2,522
100,200 Global Marine, Inc.<F1> 2,405
58,700 Grant Prideco, Inc.<F1> 1,130
19,800 Hanover Compressor Company<F1> 1,153
100,200 Kinder Morgan, Inc. 3,037
110,100 Nabors Industries, Inc.<F1> 4,342
72,300 Noble Drilling Corporation<F1> 2,887
276,400 Ocean Energy, Inc.<F1> 3,576
120,100 Petroleum Geo-Services ASA - ADR<F1> 1,938
194,800 Precision Drilling Corporation<F1> 6,234
25,300 Santa Fe International Corporation 870
21,600 Smith International, Inc.<F1> 1,642
81,700 Talisman Energy, Inc.<F1> 2,442
58,700 Weatherford International, Inc.<F1> 2,385
--------------
44,310
--------------
OIL REFINING 0.9%
153,100 Valero Energy Corporation 4,440
--------------
PAPER & RELATED PRODUCTS 0.3%
38,700 Consolidated Papers, Inc. 1,466
--------------
PRINTING & PUBLISHING 0.4%
49,350 Scholastic Corporation<F1> 2,304
--------------
MULTI-INDUSTRY 1.0%
131,050 Pentair, Inc. 5,013
--------------
RESTAURANTS 0.4%
62,000 Starbucks Corporation<F1> 1,874
--------------
See notes to the financial statements.
73
<PAGE>
SPECIAL GROWTH FUND
SCHEDULE OF INVESTMENTS
April 30, 2000
(Unaudited)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
RETAIL 6.1%
86,730 BJ's Wholesale Club, Inc.<F1> $ 3,073
103,063 Dollar General Corporation 2,358
716,395 Family Dollar Stores<F1> 13,656
109,100 Linens `n Things, Inc.<F1> 3,368
89,290 Ross Stores, Inc. 1,853
32,200 Tiffany & Company 2,341
107,000 Williams-Sonoma, Inc.<F1> 3,705
--------------
30,354
--------------
SEMICONDUCTORS 1.6%
13,500 Credence Systems Corporation<F1> 1,927
58,500 Lam Research Corporation<F1> 2,684
54,000 Veeco Instruments, Inc.<F1> 3,355
--------------
7,966
--------------
SOFTWARE 5.4%
24,000 Citrix Systems, Inc.<F1> 1,465
13,800 Electronic Arts, Inc.<F1> 835
54,400 Intuit, Inc.<F1> 1,955
89,100 Rational Software Corporation<F1> 7,585
27,000 Saga Systems, Inc.<F1> 503
100,400 Siebel Systems, Inc.<F1> 12,337
31,900 Symantec Corporation<F1> 1,992
--------------
26,672
--------------
TELECOMMUNICATIONS 2.8%
48,700 Adelphia Business Solutions, Inc.<F1> 1,705
22,800 Allegiance Telecom, Inc.<F1> 1,613
123,400 Broadwig, Inc.<F1> 3,494
54,900 McLeodUSA, Incorporated<F1> 1,373
34,900 Powertel, Inc.<F1> 2,347
96,600 Telesystem International Wireless, Inc.<F1> 3,188
--------------
13,720
--------------
TELECOMMUNICATIONS EQUIPMENT 3.3%
32,000 Crown Castle International Corporation<F1> 1,228
38,900 Ditech Communications Corporation<F1> 3,330
14,400 Harmonic, Inc.<F1> 1,063
79,300 Harris Corporation 2,562
29,800 Polycom, Inc.<F1> 2,358
27,300 Powerwave Technologies, Inc.<F1> 5,680
--------------
16,221
--------------
TEXTILES & APPAREL 0.4%
64,000 Jones Apparel Group, Inc.<F1> 1,900
--------------
TRANSPORTATION 0.2%
30,300 GATX Corporation 1,083
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
UTILITIES 5.3%
48,100 Calpine Corporation<F1> $ 4,401
105,700 Constellation Energy Group 3,495
93,200 Edison International 1,777
196,050 El Paso Energy Corporation 8,332
108,900 Kansas City Power & Light Company 2,797
39,200 Montana Power Company 1,727
80,100 PECO Energy Company 3,339
31,400 Wisconsin Energy Corporation 671
--------------
26,539
--------------
Total Common Stock (Cost $384,526) 471,700
--------------
NUMBER
OF SHARES
(IN THOUSANDS)
--------------
SHORT-TERM INVESTMENTS 6.0%
INVESTMENT COMPANIES 6.0%
7,465 Financial Square Prime Obligation Fund 7,465
22,484 Short-Term Investments Co.
Liquid Assets Portfolio 22,484
--------------
Total Investment Companies (Cost $29,949) 29,949
--------------
Total Short-Term Investments (Cost $29,949) 29,949
--------------
Total Investments (Cost $414,475) 101.0% 501,649
--------------
Liabilities, less Other Assets (1.0)% (5,282)
--------------
TOTAL NET ASSETS 100.0% $496,366
==============
<F1> Non-income producing
See notes to the financial statements.
74
<PAGE>
EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
COMMON STOCKS 94.1%
AUTO - RENTALS 1.3%
123,100 Avis Rent A Car, Inc.<F1> $ 2,493
--------------
BANKING 3.7%
79,400 Bank United Corporation Class A 2,635
42,000 CCB Financial Corporation 1,661
45,800 Commerce Bancorp, Inc. 1,818
15,700 Cullen/Frost Bankers, Inc. 388
112,700 Sovereign Bancorp, Inc. 775
--------------
7,277
--------------
BATTERIES 0.8%
74,400 Rayovac Corporation<F1> 1,553
--------------
BIOTECHNOLOGY 1.0%
26,900 Aclara Biosciences, Inc.<F1> 1,026
74,000 Texas Biotechnology Corporation<F1> 906
--------------
1,932
--------------
BUILDING & CONSTRUCTION 4.6%
113,800 Astec Industries, Inc.<F1> 2,858
54,800 Granite Construction, Inc.<F1> 1,301
121,400 Texas Industries, Inc. 3,961
58,400 U.S. Aggregates, Inc.<F1> 993
--------------
9,113
--------------
BUSINESS MACHINES & SOFTWARE 1.7%
100,330 Affiliated Computer Services, Inc.<F1> 3,323
--------------
BUSINESS SERVICES 4.8%
139,935 F.Y.I. Incorporated<F1> 3,752
37,400 NCO Group, Inc.<F1> 1,286
175,800 The Source Information Management Company<F1> 2,593
84,935 Steiner Leisure Ltd<F1> 1,709
--------------
9,340
--------------
CHEMICALS 2.9%
188,600 M.A. Hanna Company 2,169
75,500 Minerals Technologies, Inc. 3,492
--------------
5,661
--------------
COMMUNICATIONS & MEDIA 0.5%
24,400 Citadel Communications Corporation<F1> 953
--------------
COMPUTERS 1.6%
54,800 Zebra Technologies Corporation<F1> 3,123
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
DATA PROCESSING 8.5%
230,491 Acxiom Corporation<F1> $ 6,223
112,015 The BISYS Group, Inc.<F1> 7,008
65,100 National Computer Systems, Inc. 3,349
--------------
16,580
--------------
DRUGS 1.9%
43,600 Alpharma, Inc. Class A 1,684
48,700 Shire Pharmaceuticals Group PLC - ADR<F1> 1,960
--------------
3,644
--------------
ELECTRICAL COMPONENTS AND SEMICONDUCTORS 14.2%
60,900 ATMI, Inc.<F1> 2,345
86,700 Benchmark Electronics, Inc.<F1> 3,484
26,200 Burr-Brown Corporation<F1> 1,786
14,100 Credence Systems Corporation<F1> 2,013
46,600 CTS Corporation 2,939
90,900 Integrated Device Technology, Inc.<F1> 4,369
5,700 Intersil Holding Corporation<F1> 192
36,600 Kulicke and Soffa Industries, Inc.<F1> 2,866
13,100 Micrel,Inc.<F1> 1,133
47,900 Novellus Systems, Inc.<F1> 3,194
54,900 Photronics, Inc.<F1> 1,829
16,800 TriQuint Semiconductor, Inc.<F1> 1,727
--------------
27,877
--------------
ENTERTAINMENT & LEISURE 1.5%
48,200 Anchor Gaming<F1> 1,940
138,430 Cinar Corporation<F1> 969
--------------
2,909
--------------
FINANCIAL SERVICES 0.7%
45,800 Federated Investors, Inc. 1,294
--------------
FOOD & BEVERAGE 0.6%
74,000 Universal Foods Corporation 1,216
--------------
INSURANCE 6.1%
111,000 Enhance Financial Services Group, Inc. 1,124
42,545 Financial Security Assurance Holdings Ltd. 3,140
142,060 Arthur J. Gallagher & Co. 5,292
82,400 Hooper Holmes, Inc. 1,432
40,000 Protective Life Corporation 952
--------------
11,940
--------------
INTERNET PRODUCTS & SERVICES 0.4%
131,600 Edgar Online, Inc.<F1> 861
--------------
See notes to the financial statements.
75
<PAGE>
EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
LIQUOR 0.9%
33,900 Canandaigua Brands, Inc.<F1> $ 1,708
--------------
MEDICAL INSTRUMENTS 4.0%
74,800 DENTSPLY International, Inc.<F1> 2,174
129,200 Edwards Lifesciences Corporation<F1> 1,929
44,300 Patterson Dental Company<F1> 2,132
73,800 Renal Care Group, Inc.<F1> 1,647
--------------
7,882
--------------
MULTI-INDUSTRY 2.9%
88,400 GSI Lumonics, Inc.<F1> 1,663
96,600 Kaydon Corporation 2,258
53,700 Mettler-Toledo International, Inc.<F1> 1,867
--------------
5,788
--------------
OIL & GAS - DOMESTIC 3.6%
80,100 Barrett Resources Corporation<F1> 2,543
43,200 Newfield Exploration Company<F1> 1,755
31,200 St. Mary Land & Exploration Company 1,053
72,400 Veritas DGC, Inc.<F1> 1,738
--------------
7,089
--------------
OIL & GAS SERVICES 0.6%
48,700 National-Oilwell, Inc.<F1> 1,166
--------------
RESTAURANTS 0.7%
42,000 Brinker International, Inc.<F1> 1,339
--------------
RETAIL 9.8%
124,100 Ames Department Stores<F1> 2,226
49,220 CDW Computer Centers, Inc.<F1> 5,119
394,427 Goody's Family Clothing, Inc.<F1> 2,564
109,750 InterTAN, Inc.<F1> 1,516
131,840 The Men's Wearhouse, Inc.<F1> 2,826
128,440 Pier 1 Imports<F1> 1,461
97,200 Rent-A-Center, Inc.<F1> 1,980
87,200 Whitehall Jewellers, Inc.<F1> 1,499
--------------
19,191
--------------
SOFTWARE 5.0%
93,200 Aspen Technology, Inc.<F1> 3,297
138,500 General Magic, Inc.<F1> 762
16,600 Mercury Interactive Corporation<F1> 1,494
311,800 QuadraMed Corporation<F1> 1,218
95,300 Verity, Inc.<F1> 3,091
--------------
9,862
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
TELECOMMUNICATIONS EQUIPMENT 5.0%
61,600 ADTRAN, Inc.<F1> $ 4,162
47,400 Alpha Industries, Inc.<F1> 2,465
39,800 Black Box Corporation<F1> 3,062
--------------
9,689
--------------
TELECOMMUNICATIONS SERVICES 2.2%
56,700 MGC Communications, Inc.<F1> 2,778
42,100 Viatel, Inc.<F1> 1,610
--------------
4,388
--------------
TRANSPORTATION 1.9%
74,900 Circle International Group, Inc. 1,989
77,000 EGL, Inc.<F1> 1,766
--------------
3,755
--------------
UTILITY 0.7%
53,900 Kansas City Power & Light Company 1,385
--------------
Total Common Stock (Cost $149,538) $184,331
--------------
NUMBER
OF SHARES
(IN THOUSANDS)
--------------
SHORT-TERM INVESTMENTS 8.3%
INVESTMENT COMPANIES 5.3%
1,240 Financial Square Prime Obligation Fund 1,240
9,086 Short-Term Investments Co.
Liquid Assets Portfolio 9,086
--------------
Total Investment Companies (Cost $10,326) 10,326
--------------
PRINCIPAL
AMOUNT
(IN THOUSANDS)
--------------
VARIABLE RATE DEMAND NOTES 3.0%
$ 6,000 Sara Lee Corporation 6,000
--------------
Total Variable Rate Demand Notes (Cost $6,000) 6,000
--------------
Total Short-Term Investments (Cost $16,326) 16,326
--------------
Total Investments (Cost $165,864) 102.4% 200,657
--------------
Liabilities, less Other Assets (2.4)% (4,784)
--------------
TOTAL NET ASSETS 100.0% $195,873
==============
<F1> Non-income producing
See notes to the financial statements.
76
<PAGE>
MICROCAP FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
Common Stocks 97.3%
ADVERTISING 0.3%
165,700 Interep National Radio Sales, Inc.<F1> $ 953
--------------
AEROSPACE & AIRCRAFT 0.5%
168,600 Kaman Corporation 1,791
--------------
BANKING 2.1%
132,500 BankUnited Financial Corporation<F1> 812
98,500 Columbia Banking System, Inc.<F1> 1,213
91,800 Greater Bay Bancorp<F1> 3,903
82,200 Sterling Bancshares, Inc. 904
--------------
6,832
BATTERIES 0.7%
101,800 Rayovac Corporation 2,125
--------------
BIOTECHNOLOGY 1.2%
29,500 Corixa Corporation<F1> 907
151,500 Diacrin, Inc.<F1> 1,098
16,500 Diversa Corporation<F1> 446
16,700 Gene Logic, Inc.<F1> 449
31,900 Trimeris, Inc.<F1> 1,098
--------------
3,998
BROADCASTING - RADIO & TELEVISION 0.8%
123,250 Saga Communications, Inc.<F1> 2,496
--------------
BUSINESS SERVICES 2.4%
257,600 Hall Kinton & Associates, Inc.<F1> 6,327
84,500 The Management Network Group, Inc.<F1> 1,500
--------------
7,827
COMMUNICATIONS & MEDIA 0.7%
186,000 Classic Communications, Inc. - Class A<F1> 2,255
--------------
COMPUTER SOFTWARE & SERVICES 11.1%
139,800 ActionPoint, Inc.<F1> 1,267
192,500 AremisSoft Corporation<F1> 5,462
247,200 Daisytek International Corporation<F1> 3,028
120,100 Datalink Corporation<F1> 1,997
207,589 Genroco, Inc.<F1><F2> 1,679
199,200 Level 8 Systems, Inc.<F1> 5,030
61,200 Media 100, Inc.<F1> 1,480
32,100 Nuance Communications, Inc.<F1> 969
101,400 PC-Tel, Inc.<F1> 3,397
220,200 ProSoft Training.Com<F1> 3,688
2,785 Tridium, Inc.<F1><F2> 1,524
305,000 Ultimate Software Group, Inc.<F1> 2,707
574,500 Zamba Corporation<F1> 3,734
--------------
35,962
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
CONSTRUCTION EQUIPMENT 1.0%
122,400 Astec Industries, Inc.<F1> $ 3,075
--------------
DISTRIBUTION 0.8%
157,650 Pomeroy Computer Resources,Inc.<F1> 2,601
--------------
DRUGS 0.3%
19,800 D&K Healthcare Resources, Inc.<F1> 173
187,400 Serologicals Corporation<F1> 679
--------------
852
--------------
ELECTRONICS 15.9%
46,000 II-VI, Inc.<F1> 1,863
306,900 Aeroflex, Inc.<F1> 11,432
77,200 Alpha Industries, Inc.<F1> 4,014
123,300 Applied Science & Technology, Inc.<F1> 3,352
93,300 ATS Automation Tooling Systems, Inc.<F1> 1,653
134,300 Catalyst Semiconductor, Inc.<F1> 1,024
33,000 Integrated Silicon Solution,Inc.<F1> 1,009
75,000 inTest Corporation<F1> 1,678
104,100 LTX Corporation<F1> 4,763
66,000 Mattson Technology, Inc.<F1> 3,242
6,100 Metalink, Ltd.<F1> 174
182,610 Micro Component Technology, Inc.<F1> 1,472
47,600 Nanometrics, Inc.<F1> 1,827
56,100 Power Integrations, Inc.<F1> 1,276
212,100 Stamford International, Inc.<F1><F2> 3,235
169,200 Telecom Semiconductor, Inc.<F1> 4,156
60,566 Three Five Systems, Inc.<F1> 5,269
--------------
51,439
--------------
ENTERTAINMENT & LEISURE 2.9%
187,700 Championship Auto Racing Teams, Inc.<F1> 3,801
106,500 JAKKS Pacific, Inc.<F1> 1,957
29,000 Meade Instruments Corporation<F1> 2,121
97,600 THQ, Inc.<F1> 1,513
--------------
9,392
--------------
FINANCIAL SERVICES 0.1%
23,900 MicroFinancial,Inc. 239
--------------
FOOD, BEVERAGES & TOBACCO 0.5%
61,600 Performance Food Group Company<F1> 1,625
--------------
HEALTH CARE SERVICES & SUPPLIES 1.6%
26,300 LifePoint Hospitals, Inc.<F1> 450
314,200 Osteotech, Inc.<F1> 2,239
505,700 Quadramed Corporation<F1> 1,975
24,900 Triad Hospitals, Inc.<F1> 428
--------------
5,092
--------------
INSURANCE 0.7%
109,300 Fidelity National Financial, Inc. 1,612
36,800 Triad Guaranty, Inc.<F1> 773
--------------
2,385
--------------
See notes to the financial statements.
77
<PAGE>
MICROCAP FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
INTERNET PRODUCTS & SERVICES 3.9%
109,300 Braun Consulting, Inc.<F1> $ 2,733
108,600 eMerge Interactive, Inc.<F1> 2,029
41,100 Internet Commerce Corporation - Class A<F1> 922
114,702 Internet Commerce Corporation -
Non Registered<F1><F2> 2,074
243,500 Luminant Worldwide Corporation<F1> 2,115
114,000 Navidec, Inc.<F1> 962
92,600 PalmWorks, Inc.<F1> 417
2 PSINet, Inc.<F1> 0
71,400 Tanning Technology Corporation<F1> 1,312
--------------
12,564
--------------
MANUFACTURING - INDUSTRIAL 2.0%
97,900 Century Aluminum Company 1,371
86,700 CIRCOR International, Inc. 992
24,500 CoorsTek, Inc.<F1> 1,108
123,200 DT Industries, Inc.<F1> 1,525
230,900 Griffon Corporation<F1> 1,559
--------------
6,555
--------------
MEDICAL INSTRUMENTS 1.8%
154,800 Candela Corporation<F1> 2,080
303,100 Packard BioScience Company<F1> 3,618
--------------
5,698
--------------
OIL & GAS - DOMESTIC 6.6%
331,900 Cabot Oil & Gas Corporation 6,161
225,700 Chieftain International, Inc.<F1> 4,288
229,900 HS Resources, Inc.<F1> 5,561
126,100 Louis Dreyfus Natural Gas Corp.<F1> 3,531
78,100 Nuevo Energy Company<F1> 1,367
272,800 Range Resources Corporation 409
--------------
21,317
--------------
OIL & GAS SERVICES 9.8%
245,900 CE Franklin Ltd. 1,445
55,800 Cal Dive International, Inc.<F1> 2,776
312,400 Horizon Offshore, Inc.<F1> 2,655
160,500 Key Energy Services, Inc.<F1> 1,565
86,400 Maverick Tube Corporation<F1> 2,462
81,700 Midcoast Energy Resources, Inc. 1,297
370,600 Oceaneering International, Inc.<F1> 6,393
335,900 Superior Energy Services, Inc.<F1> 3,107
516,200 Unit Corporation<F1> 5,775
126,200 UTI Energy Corporation<F1> 4,385
--------------
31,860
--------------
PRIVATE CORRECTION FACILITIES 0.8%
307,100 Cornell Corrections, Inc.<F1> 2,764
--------------
RESTAURANTS 0.7%
145,800 Buca, Inc.<F1> 2,196
--------------
NUMBER MARKET VALUE
OF SHARES (IN THOUSANDS)
--------- --------------
RETAIL 6.1%
123,100 Charlotte Russe Holding, Inc.<F1> $ 1,354
232,400 Chico's Fas, Inc.<F1> 4,169
185,200 Cost Plus, Inc.<F1> 5,660
408,100 Goody's Family Clothing, Inc.<F1> 2,653
62,200 PETCO Animal Supplies, Inc.<F1> 719
177,300 Ultimate Electronics, Inc.<F1> 5,253
--------------
19,808
--------------
SCHOOLS 2.5%
139,400 Career Education Corporation<F1> 5,271
132,500 Corinthian Colleges, Inc.<F1> 2,849
--------------
8,120
--------------
TELECOMMUNICATIONS 6.8%
123,400 Adelphia Business Solutions, Inc.<F1> 4,319
10,800 Aether Systems, Inc.<F1> 1,798
207,100 Alaska Communications Systems Holdings, Inc.<F1> 2,485
126,900 California Amplifier, Inc.<F1> 3,426
283,600 Metro One Telecommunications, Inc.<F1> 3,403
146,700 MDSI Mobile Data Solutions, Inc.<F1> 5,135
4,100 NorthEast Optic Network, Inc.<F1> 230
53,600 US LEC Corp.<F1> 1,400
--------------
22,196
--------------
TELECOMMUNICATIONS EQUIPMENT 9.8%
6,100 BreezeCom, Ltd.<F1> 168
271,100 Data Critical Corporation<F1> 3,152
383,600 FiberCore, Inc.<F1> 1,978
206,800 General Magic, Inc.<F1> 1,137
62,000 Natural MicroSystems Corporation<F1> 4,038
151,300 Paradyne Networks, Inc.<F1> 4,265
287,300 REMEC, Inc.<F1> 10,899
122,800 ViaSat, Inc.<F1> 5,749
108,200 Wireless Telecom Group, Inc.<F1> 352
--------------
31,738
--------------
TEXTILES & APPAREL 1.1%
171,700 Steven Madden, Ltd.<F1> 3,724
--------------
TRANSPORTATION 1.8%
133,400 Circle International Group, Inc. 3,543
119,000 Knightsbridge Tankers, Ltd. 2,216
--------------
5,759
--------------
Total Common Stock (Cost $277,597) 315,238
--------------
See notes to the financial statements.
78
<PAGE>
MICROCAP FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER OF SHARES MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
SHORT-TERM INVESTMENTS 2.9%
Investment Companies 1.3%
186 Financial Square Prime Obligation Fund $ 186
4,039 Short-Term Investments Co.
Liquid Assets Portfolio 4,039
--------------
Total Investment Companies (Cost $4,225) 4,225
--------------
PRINCIPAL
AMOUNT
(IN THOUSANDS)
--------------
VARIABLE RATE DEMAND NOTES 1.6%
$5,000 Sara Lee Corporation 5,000
--------------
Total Variable Rate Demand Notes (Cost $5,000) 5,000
--------------
Total Short-Term Investments (Cost $9,225) 9,225
--------------
Total Investments (Cost $286,822) 100.2% 324,463
--------------
Liabilities, less Other Assets (0.2)% (621)
--------------
TOTAL NET ASSETS 100.0% $323,842
==============
<F1> Non-income producing
<F2> Fair valued security
See notes to the financial statements.
79
<PAGE>
CORE INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES INDUSTRY VALUE
--------- -------- ----------
<S> <C> <C>
COMMON AND PREFERRED STOCKS 92.6%
AUSTRALIA 3.9%
52,600 Australian Gas Light Company Ltd. Gas Utility $ 273,159
31,000 Commonwealth Bank of Australia Banks 471,747
201,000 Foster's Brewing Group Ltd. Brewery 507,367
48,200 Westpac Banking Corporation Banks 307,402
----------
1,559,675
AUSTRIA 1.0%
9,000 Bank Austria AG Banks 400,255
----------
BELGIUM 1.9%
900 Electrabel SA Electric Utility 218,090
21,500 Fortis (B) Financial Services 544,113
----------
762,203
----------
CANADA 0.6%
1,000 Magna Entertainment Corporation - Class A<F1> Entertainment & Leisure 4,125
5,000 Magna International, Inc. - Class A Automobiles 233,750
----------
237,875
DENMARK 1.9%
67,331 Nortic Baltic Holding AB<F1> Financial Services 419,714
4,500 Tele Danmark AS Telecommunications 330,013
----------
749,727
----------
FINLAND 2.3%
15,600 Nokia Oyj Telecommunications 897,075
----------
FRANCE 11.2%
3,100 Alcatel Telecommunications 720,405
5,000 Aventis SA Drugs 275,677
3,000 Compagnie de Saint-Gobain Building & Construction 410,371
1,800 Groupe Danone Food &Beverages 394,514
6,800 Lafarge SA Building & Construction 564,549
4,700 Lagardere S.C.A. Multi-Industry 319,101
6,700 SCOR Assistance Insurance 292,350
8,303 Schneider Electric SA Machinery 544,806
4,522 Total Final Elf Oil & Gas Exploration 687,799
3,900 Valeo SA Automobile Parts 216,805
----------
4,426,377
----------
GERMANY 7.6%
6,826 Aventis SA Drugs 377,598
15,500 Bayer AG Chemicals 643,420
13,200 Continental AG Rubber - Tires 240,590
3,100 DaimlerChrysler AG Automobiles 180,807
3,500 Schering AG Drugs 495,990
5,600 Siemens AG Multi-Industry 828,288
4,900 Veba AG Multi-Industry 242,700
----------
3,009,393
==========
</TABLE>
See notes to the financial statements.
80
<PAGE>
CORE INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES INDUSTRY VALUE
--------- -------- ----------
<S> <C> <C>
GREAT BRITAIN 17.0%
83,000 Allied Domecq PLC Beverages $ 408,830
21,800 Associated British Foods PLC Food Products 129,640
87,000 BAE Systems Aerospace 536,432
14,000 BOC Group PLC Chemicals 231,580
57,000 Bass PLC Beverages 669,906
33,000 British Telecommunications Telecommunications 594,413
52,100 Cadbury Schweppes PLC Food Products 357,933
253,000 Corus Group PLC Manufacturing 340,501
35,200 Gallaher Group PLC Tobacco 174,898
100,000 Invensys PLC Manufacturing 481,221
36,200 Johnson Matthey PLC Electronics 467,088
30,000 Rio Tinto PLC Mining 467,136
66,000 Royal & Sun Alliance Insurance Group PLC Insurance 370,282
45,000 ScottishPower PLC Electric Utility 362,148
34,000 SmithKline Beecham PLC Drugs 467,433
158,800 Tomkins PLC Manufacturing 490,192
23,173 Trinity Mirror PLC Publishing 180,775
----------
6,730,408
----------
IRELAND 0.7%
28,000 Allied Irish Banks PLC Banks 280,051
----------
ITALY 2.4%
156,420 Benetton Group SPA Textiles & Apparel 288,664
137,000 ENI SPA Oil & Gas Exploration 682,940
----------
971,604
----------
JAPAN 18.7%
16,000 Canon, Inc. Photo Equipment 731,345
40,000 Chugai Pharmaceutical Company, Ltd. Drugs 769,836
17,000 Dai Nippon Printing Company, Ltd. Printing 288,328
30 East Japan Railway Company Transporation 177,655
6,000 Eisai Company, Ltd. Drugs 174,879
6,600 FamilyMart Company, Ltd. Retail 241,832
62,000 Fuji Heavy Industries, Ltd. Automobiles 473,283
15,000 Fuji Photo Film Company, Ltd. Photo Equipment 600,972
12,000 Jusco Company, Ltd. Retail 222,068
16,000 Kao Corporation Household Products 487,070
106,000 Kubota Corporation Machinery 345,242
3,300 Nintendo Company, Ltd. Entertainment & Leisure 549,619
37 NTT Corporation Telecommunications 458,756
1,200 Rohm Company, Ltd. Electronics 401,943
24,000 Shiseido Company, Ltd. Household Products 303,345
1,700 Sony Corporation<F1> Electronics 196,623
1,700 Sony Corporation Electronics 195,207
13,000 Toyota Motor Corporation Automobiles 645,941
20,000 Wacoal Corporation Textiles & Apparel 168,772
----------
7,432,716
----------
</TABLE>
See notes to the financial statements.
81
<PAGE>
CORE INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES INDUSTRY VALUE
--------- -------- ----------
<S> <C> <C>
NETHERLANDS 7.6%
28,600 ABN AMRO Holding NV Banks $ 590,349
11,500 Akzo Nobel NV Chemicals 471,927
12,500 Hagemeyer NV Consumer Products 246,349
25,000 Koninklijke Ahold NV Retail - Food 584,389
5,200 KPN NV Telecommunications 525,308
6,100 Royal Dutch Petroleum Company Oil & Gas Exploration 352,447
11,200 TNT Post Group NV Transportation 244,965
----------
3,015,734
----------
NEW ZEALAND 1.4%
129,100 Telecom Corporation Telecommunications 546,103
----------
NORWAY 0.8%
67,700 Christiania Bank Og Kreditkasse Banks 313,265
----------
SINGAPORE 0.5%
20,000 Singapore Airlines LTD Transportation 207,321
----------
SPAIN 6.9%
16,600 Banco Popular Espanol SA Banks 449,303
30,800 Endesa SA Electric Utility 669,724
30,100 Grupo Dragados SA Building & Construction 230,420
31,000 Repsol - YPF SA Oil & Gas Exploration 635,651
33,900 Telefonica SA Telecommunications 756,285
----------
2,741,383
----------
SWEDEN 3.3%
6,600 AstraZeneca Group PLC Drugs 276,075
23,300 Electrolux AB Appliances 394,276
17,800 SKF AB - Class B Manufacturing 381,727
10,600 Volvo AB Automobiles 257,511
----------
1,309,589
----------
SWITZERAND 2.9%
300 Nestle SA Food Products 530,078
1,800 Swisscom AG Telecommunications 636,094
----------
1,166,172
----------
Total Common and Preferred Stocks (Cost $37,110,560) 36,756,926
----------
</TABLE>
See notes to the financial statements.
82
<PAGE>
CORE INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
--------- -----------
<S> <C>
SHORT-TERM INVESTMENTS 3.7%
VARIABLE RATE DEMAND NOTES 3.7%
$1,471,975 Chase U.S. $ 1,471,975
-----------
Total Short-Term Investments (Cost $1,471,975) 1,471,975
-----------
Total Investments (Cost $38,582,535) 96.3% 38,228,901
-----------
Other Assets, less Liabilities 3.7% 1,458,981
-----------
TOTAL NET ASSETS 100% $39,687,882
===========
<F1> Non-income producing
</TABLE>
See notes to the financial statements.
83
<PAGE>
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES INDUSTRY VALUE
--------- -------- ----------
<S> <C> <C>
COMMON AND PREFERRED STOCKS 89.8%
AUSTRALIA 3.3%
150,000 Orica Limited Specialty Chemicals $ 592,543
48,864 National Australia Bank Ltd. Banks 668,893
420,000 North Limited Mining 721,729
----------
1,983,165
----------
AUSTRIA 2.2%
9,787 Bank Austria AG<F1> Banks 435,255
9,200 Boehler-Uddeholm AG Steel 359,347
9,500 VA Technologie AG Engineering 566,901
----------
1,361,503
----------
BERMUDA 1.0%
13,000 XL Capital Ltd. - Class A Insurance 619,125
----------
BRAZIL 1.8%
8,500 Companhia Vale do Rio Doce ADR Diversified Minerals 210,563
25,000 Embratel Participacoes SA Telecommunications 562,500
12,000 Unibanco - Sponsored GDR Banks 299,250
----------
1,072,313
----------
CROATIA 0.7%
35,000 Pliva d.d. 144A GDR<F2> Pharmaceuticals 434,259
----------
CZECH REPUBLIC 2.4%
186,500 A/S Ceske Energeticke Zavody AS<F1> Electric Power Company 546,289
122,200 Komercni Banka A.S. ADR Banks 928,720
----------
1,475,009
----------
DENMARK 1.1%
3,300 A/S Codan Insurance 237,976
64,346 Nortic Baltic Holding AB<F1> Financial Services 401,104
----------
639,080
----------
FINLAND 0.6%
1 Instrumentarium Corporation Medical Products 26
27,000 Metso Oyj Capital Goods 356,785
----------
356,811
----------
FRANCE 4.5%
26,000 Alstom Capital Goods 649,467
14,300 Aventis SA Pharmaceuticals 788,435
2,600 Compagnie de Saint Gobain Building & Construction Materials 355,655
12,000 Scor Assistance Insurance 523,613
32,000 Usinor SA Steel 421,398
----------
2,738,568
----------
</TABLE>
See notes to the financial statements.
84
<PAGE>
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES INDUSTRY VALUE
--------- -------- ----------
<S> <C> <C>
GERMANY 2.9%
16,300 BASF AG Chemicals $ 706,338
11,000 Jenoptik AG Engineering 316,778
39,000 Viag AG Multi-Industry 753,486
----------
1,776,602
----------
GREAT BRITAIN 9.8%
80,845 British Airways PLC Airlines 420,989
44,650 British Telecommunications PLC Telecommunications 804,259
195,000 Corus Group PLC Steel 262,441
130,000 Eircom PLC Telecommunications 459,081
72,000 Enterprise Oil PLC<F1> Oil & Gas Exploration 532,676
65,000 Nycomed Amersham PLC Pharmaceuticals 499,452
233,823 Rolls-Royce PLC<F1> Aerospace & Aircraft 869,975
107,394 Royal & Sun Alliance Insurance Group PLC Insurance 602,516
21,900 Royal Bank of Scotland Group PLC Banks 341,523
53,024 Scottish and Southern Energy PLC Electricity - Integrated 449,335
203,000 Tesco PLC Retail - Food 695,728
----------
5,937,975
----------
GREECE 0.7%
20,000 Hellenic Telecommunications Organization SA Telecommunications 449,916
----------
HUNGARY 0.8%
14,000 Matav RT-Sponsored ADR Telecommunications 487,375
----------
HONG KONG 4.6%
360,000 Hongkong Land Holdings Limited Real Estate Development 547,200
54,390 HSBC Holdings PLC Banks 608,372
35,000 Hutchison Whampoa Limited Multi-Industry 510,001
142,000 Peregrine Investments Holdings Limited Financial Services 0
176,000 SmarTone Telecommunications Limited Telecommunications 551,892
782,500 Swire Pacific Ltd. Multi-Industry 582,666
----------
2,800,131
----------
INDONESIA 0.6%
255,000 PT Indonesian Satellite Telecommunications 337,050
----------
IRELAND 1.0%
14,500 Elan Corporation PLC Pharmaceuticals 621,688
----------
</TABLE>
See notes to the financial statements.
85
<PAGE>
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES INDUSTRY VALUE
--------- -------- ----------
<S> <C> <C>
JAPAN 22.5%
130,000 Asahi Chemical Industry, Ltd. Chemicals $ 748,185
104,000 The Dai-Ichi Kangyo Bank, Ltd. Banks 862,217
53,000 Daiichi Pharmaceutical Co., Ltd. Pharmaceuticals 911,164
39,800 Daito Trust Construction Co. Construction & Housing 626,047
75,000 Daiwa Securities Company Limited Financial Services 1,145,039
23,000 Fujitsu Limited Computer Services & Electronics 651,215
83,000 Hitachi Ltd. Electronics 990,702
145,000 Joyo Bank, Ltd. Banks 517,882
300,000 Marubeni Corporation Multi-Industry 868,842
40,000 Marui Co., Ltd. Retail 751,331
22,000 NEC Corporation Electronics 598,474
125,600 Nichido Fire & Marine Insurance Insurance 569,457
19,000 Nihon Unisys, Ltd. Software Services 441,268
204,000 Nippon Fire & Marine Insurance Insurance 556,836
145,000 Nishimatsu Construction Co., Ltd. Building & Construction 462,873
25 NTT Mobile Communication Network, Inc Telecommunications 835,069
28,000 Sankyo Company, Ltd. Pharmaceuticals 616,609
145,000 The Sumitomo Trust & Banking Co., Ltd. Banks 1,059,913
120,000 The Tokyo Trust & Banking Co., Ltd. Banks 438,585
----------
13,651,708
----------
MALAYSIA 2.1%
150,000 Malayan Banking Bhd Banks 623,684
490,000 Technology Resources Industries Bhd Telecommunications 626,684
----------
1,250,368
----------
MEXICO 0.9%
9,500 Telefonos de Mexico SA Telecommunications 558,719
----------
NETHERLANDS 2.8%
10,200 DSM NV Chemicals 335,848
66,500 EVC International NV Chemicals 787,843
5,500 Koninklijke KPN NV Telecommunications 555,614
----------
1,679,305
----------
NEW ZEALAND 2.3%
361,000 Air New Zealand Limited - Class B Air Transportation 440,565
434,000 Carter Holt Harvey Limited Paper & Forest Products 367,171
252,000 Fletcher Challenge Energy Oil & Gas Exploration 582,000
----------
1,389,736
----------
NORWAY 1.6%
34,000 Bergesen d.y. ASA "B" Transportation/Shipping 543,422
20,000 Odfjell ASA "A" Transportation/Shipping 290,600
7,500 Petroleum Geo Services ASA Oil & Gas Exploration 117,358
----------
951,380
----------
</TABLE>
See notes to the financial statements.
86
<PAGE>
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES INDUSTRY VALUE
--------- -------- ----------
<S> <C> <C>
PHILIPPINES 1.2%
46,000 Metropolitan Bank & Trust Company Banks $ 256,267
25,500 Philippine Long Distance Telephone Company Telecommunications 457,067
----------
713,334
----------
PORTUGAL 0.8%
44,500 Portugal Telecom SA Telecommunications 497,599
----------
RUSSIA 1.5%
4,700 Lukoil Holding ADR Oil & Gas - International 283,316
33,000 Rostelecom ADR Telecommunications 641,438
----------
924,754
----------
SINGAPORE 3.0%
98,000 Asia Pulp & Paper Company Ltd. ADR<F1> Paper Products 618,625
112,000 City Developments Limited Real Estate 508,346
95,040 United Overseas Bank Ltd. Banks 662,358
----------
1,789,329
----------
SLOVAK REPUBLIC 0.2%
50,000 Slovakofarma 144A GDR<F2> Health & Beauty Aids 115,000
----------
SOUTH AFRICA 1.7%
13,616 AngloGold Limited Mining 518,169
140,000 Standard Bank Investment Corporation Limited Banks 516,262
----------
1,034,431
----------
SPAIN 2.4%
13,500 Catalana Occidente Insurance 185,528
46,000 Iberdrola SA Electric Utility 591,506
30,000 Repsol SA Oil & Gas - International 717,671
----------
1,494,705
----------
SWEDEN 4.6%
7,956 ABB Ltd.<F1> Engineering 888,641
28,490 AssiDoman AB Paper & Forest Products 470,962
19,612 AstraZeneca Group PLC Pharmaceuticals 820,361
26,000 Atlas Copco AB - Class B Capital Goods 595,514
----------
2,775,478
----------
SWITZERLAND 3.0%
525 Novartis AG Pharmaceuticals 735,091
1,250 Schweizerische Lebensversicherungs-und Rentenansta Insurance 663,325
1,750 UBS AG Banks 429,744
----------
1,828,160
----------
THAILAND 1.2%
710,000 Thai Farmers Bank Public Company Limited Banks 745,700
----------
Total Common and Preferred Stocks (Cost $51,815,004) 54,490,276
----------
</TABLE>
See notes to the financial statements.
87
<PAGE>
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES INDUSTRY VALUE
--------- -------- ----------
<S> <C> <C>
SHORT-TERM INVESTMENTS 8.6%
INVESTMENT COMPANIES 3.0%
11,000 Genesis Chile Fund Investment Companies $ 313,500
76,000 Korea Fund, Inc. Investment Companies 945,250
31,000 ROC Taiwan Fund Investment Companies 298,375
38 Thailand International Fund Investment Companies 269,800
----------
Total Investment Companies (Cost $1,826,925) 1,826,925
----------
PRINCIPAL
AMOUNT
----------
Variable Rate Demand Notes 5.6%
$3,386,934 Chase U.S. 3,386,934
----------
Total Variable Rate Demand Notes (Cost $3,386,934) 3,386,934
----------
Total Short-Term Investments (Cost $5,213,859) 5,213,859
----------
Total Investments (Cost $57,028,863) 98.4% 59,704,135
----------
Other Assets, less Liabilities 1.6% 951,466
----------
TOTAL NET ASSETS 100% $60,655,601
==========
<F1> Non-income producing
<F2> Restricted security
</TABLE>
See notes to the financial statements.
88
<PAGE>
This page intentionally left blank.
89
<PAGE>
Short-Term Bond Market Fund
Q: WHAT WERE THE CONDITIONS IN THE BOND MARKET DURING THE REPORTING PERIOD?
A: In a word, turbulent. Rates climbed (particularly on the short end of the
yield curve), the Treasury yield curve has inverted, spreads between
corporate bonds and treasury bonds have widened, and major news stories
surfaced frequently to cause disruption and volatility in the bond market.
The U.S. economy has continued to show signs of strength, causing concern
over inflation which has begun to show up in various forms (such as oil
prices and employment costs).
These concerns have pushed up yields on the short end of the curve while
increases on the intermediate- and long-term parts of the curve have been
more modest. This inversion of the yield curve was caused by the perception
that current inflationary pressures are short-term, not long-term and are
cyclical, not secular.
Also, a major contributor to the inversion of the yield curve was the buy
back program employed by the Treasury to reduce its long term debt.
Legislative proposals to eliminate the implied backing of certain agency
issues by the federal government have caused spreads on agency debt to widen
dramatically. High profile downgrades of certain corporate bonds such as JC
Penney's have also added to the market's volatility.
Q: HOW DID YOU MANAGE THE PORTFOLIO IN THAT ENVIRONMENT?
A: We maintained the duration of the portfolio neutral to our benchmark (the
Lehman Brothers 1-3 Year Government & Corporate Bond Index) to mitigate the
relative interest rate risk. Given where short-term rates stand currently
(6.50% Fed Funds rate after the May 16, 2000 increase of 0.50%) versus more
benign expectations six months ago, we avoided a potential negative impact
had the portfolio's duration been extended. We selectively added securities
to enhance the portfolio's yield.
Q: HOW DID YOU MANAGE THE PORTFOLIO'S CREDIT QUALITY?
A: As is typical for Firstar Short-Term Bond Market Fund, we kept the overall
credit quality high (average quality of the portfolio was AA during the
period). Given our economic and market expectations, we actually upgraded
quality, reducing our Baa exposure by approximately one half its level six
months ago and reallocating to A rated securities.
Q: HOW DID THE PORTFOLIO PERFORM DURING THE REPORTING PERIOD COMPARED TO ITS
BENCHMARK?
A: Net of operating expenses, the Firstar Short-Term Bond Market Fund's return
for the period was 2.0% (Institutional shares), outperforming its benchmark,
the Lehman Brothers 1-3 Year Government & Corporate Bond Index, which earned
1.8%.
Q: WHAT IS YOUR OUTLOOK FOR THE CORPORATE BOND MARKET AND THE PORTFOLIO GOING
FORWARD?
A: We expect short-term rates to continue to rise until there are signs of
moderating growth and resulting inflationary pressures, as well as a less
speculatively driven stock market. Given the 1.75% in rate increases thus far
and the possibility of an additional 0.25% to 1.00% in future increases,
corporate bonds are more attractive than six months ago, but careful
selection is important.
PORTFOLIO MANAGER PROFILE
--------------------------------------------------------------------------------
Richard Burling, CFA, Senior Vice President and Director of Credit Research with
Firstar Investment Research & Management Company, LLC (FIRMCO) and Bradley
Peters, CFA, CPA, Senior Vice President with FIRMCO, have co-managed the Fund
since February 14, 2000. Mr. Burling has 17 years of investment experience
managing both private and institutional accounts. He has a BA from Northwestern
University and received his MBA from the University of Wisconsin. Mr. Peters has
been with Firstar since 1993 and has 18 years of financial planning and
investment management experience. He received a BBA from the University of
Wisconsin.
90
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Short-Term Bond Market Fund - Institutional
12/29/89 10,000
10/90 10,464
10/91 11,865
10/92 12,966
10/93 13,833
10/94 14,035
10/95 15,290
10/96 16,177
10/97 17,223
10/98 18,402
10/99 19,031
4/00 19,415
This chart assumes an initial investment of $10,000 made on 12/29/89
(inception). Performance reflects fee waivers in effect. In the absence of fee
waivers, total return would be reduced. Performance is shown for Institutional
shares, which have lower expenses than Series A or Series B shares. If those
fees and expenses were reflected in the chart above, total return would have
been reduced. Returns shown include the reinvestment of all dividends and other
distributions. Past performance is not predictive of future performance.
Investment return and principal value will fluctuate, so that your shares, when
redeemed, may be worth more or less than their original cost.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
FISCAL
YEAR-TO-DATE 1 YEAR 5 YEARS 10YEARS SINCE INCEPTION
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FIRSTAR SHORT-TERM BOND MARKET FUND - INSTITUTIONAL 2.0 3.6 5.9 6.8 6.6 (12/29/89)
FIRSTAR SHORT-TERM BOND MARKET FUND - A - NO LOAD 1.9 3.4 5.6 6.7 6.5 (12/29/89)
FIRSTAR SHORT-TERM BOND MARKET FUND - A - LOAD<F1> (2.2) (0.8) 4.8 6.3 6.1 (12/29/89)
FIRSTAR SHORT-TERM BOND MARKET FUND - B - NO LOAD 1.5 2.5 -- -- 3.2 (3/1/99)
FIRSTAR SHORT-TERM BOND MARKET FUND - B - LOAD<F2> (3.5) (2.4) -- -- (0.2) (3/1/99)
LEHMAN BROTHERS 1-3 YEAR GOV'T./CORP. BOND INDEX<F3> 1.8 3.6 6.0 6.7 6.6 (12/29/89)
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 4.00%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The Lehman Brothers 1-3 Year Gov't./Corp. Bond Index is an unmanaged market
value weighted index measuring both principal price changes of, and income
provided by, the underlying universe of securities that comprise the index.
Securities included in the index must meet the following criteria: fixed as
opposed to variable rate; not less than one year to maturity; not more than
three years remaining to maturity; and minimum outstanding par value of
$100 million. An investment cannot be made directly in an index.
The Lehman Brothers 1-3 Year Government/Corporate Bond Index, the Lehman
Brothers Intermediate Government/Corporate Bond Index and the Lehman Brothers
Government/Corporate Bond Index are trademarks of Lehman Brothers. The Fund, its
Adviser and the Co-Administrators are not affiliated in any way with Lehman
Brothers. Inclusion of a security in a bond index in no way implies an opinion
by Lehman Brothers as to its attractiveness or appropriateness as an investment.
Lehman Brothers' publication of the bond index is not made in connection with
any sale or offer for sale of securities or any solicitation of orders for the
purchase of securities.
Effective at the close of business January 9, 1995, Firstar Funds began to offer
Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.00%
maximum sales load and are subject to an annual 0.25% service organization fee.
The performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995,
does not reflect the service organization fees. If service organization fees had
been reflected, performance would be reduced. Series B shares have a 5.00%
maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
SECTOR DISTRIBUTION
4/30/00
--------------------------------------------------------------------------------
U.S. TREASURY 23%
--------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY 0%
--------------------------------------------------------------------------------
MORTGAGE-BACKED<F1> 7%
--------------------------------------------------------------------------------
FINANCE, BANKING,
BROKERAGE 23%
--------------------------------------------------------------------------------
INDUSTRIAL 3%
--------------------------------------------------------------------------------
UTILITY 4%
--------------------------------------------------------------------------------
INTERNATIONAL/YANKEE 3%
--------------------------------------------------------------------------------
ASSET-BACKED 33%
--------------------------------------------------------------------------------
CASH AND OTHER 4%
--------------------------------------------------------------------------------
TAXABLE MUNICIPAL 0%
--------------------------------------------------------------------------------
TOTAL 100%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION 4/30/00
--------------------------------------------------------------------------------
AVERAGE MATURITY 2.0 YEARS
--------------------------------------------------------------------------------
AVERAGE DURATION 1.9 YEARS
--------------------------------------------------------------------------------
<F1> incl. U.S. Govt. Agency-Backed
QUALITY DISTRIBUTION 4/30/00
--------------------------------------------------------------------------------
U.S. TREASURY 23%
--------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY 1%
--------------------------------------------------------------------------------
Aaa 39%
--------------------------------------------------------------------------------
Aa 3%
--------------------------------------------------------------------------------
A 25%
--------------------------------------------------------------------------------
Baa 9%
--------------------------------------------------------------------------------
Ba 0%
--------------------------------------------------------------------------------
TOTAL 100%
--------------------------------------------------------------------------------
SEC 30-DAY YIELD
--------------------------------------------------------------------------------
INSTITUTIONAL 6.41%
--------------------------------------------------------------------------------
A - NO LOAD 6.16%
--------------------------------------------------------------------------------
A - LOAD 5.91%
--------------------------------------------------------------------------------
B - NO LOAD 5.40%
--------------------------------------------------------------------------------
TOTAL FUND NET ASSETS 4/30/00
--------------------------------------------------------------------------------
$178,510,129
--------------------------------------------------------------------------------
91
<PAGE>
INTERMEDIATE BOND MARKET FUND
Q: WHAT WERE THE CONDITIONS IN THE BOND MARKET DURING THE REPORTING PERIOD?
A: The Federal Reserve tightened credit three times during the past six months.
The Federal Funds rate started the period at 5.25% and ended the period at
6.00%, for a total increase of 0.75% (the Fed increased the Fed Funds rate by
an additional 0.50% on May 16, 2000). Interest rates as measured by the U.S.
Treasury benchmarks responded in kind; the two-year Treasury went from a
yield of 5.82% to 6.72% - an increase of 0.90%.
The entire yield curve from three-month Treasury Bills out to the ten-year
Treasury Notes responded to the Fed's tightening with increasing yields (and
falling prices). The 30-year Treasury, however, reacted somewhat differently.
Its yield fell from 6.18% to 5.99%. This is attributable primarily to the
Treasury debt buy back program that is occurring in the fifteen- to
twenty-year maturity range.
Corporate debt liquidity was severely impacted during the period, with the
spread to Treasuries widening dramatically in some cases. This was due to the
flight to quality that took place among some investors who sold stock
positions. The Treasury Department's buy back program also caused some supply
disruptions, creating a perceived shortage of Treasury debt.
Q: HOW DID YOU MANAGE THE PORTFOLIO IN THAT ENVIRONMENT?
A: Our structured fixed-income investment style dictates that we remain duration
neutral to the portfolio's benchmark, the Lehman Brothers Intermediate
Government & Corporate Bond Index.
We attempted to maintain our exposure to non-Treasury sectors of the bond
market as spreads on corporate securities and even agency securities widened.
Of particular note is our new 4% weighting in government agency securities.
Many of these quasi-government securities are now trading at levels that
would have been reserved for weak single-A rated corporate securities six
months ago.
Q: HOW DID YOU MANAGE THE PORTFOLIO'S CREDIT QUALITY?
A: The overall credit quality of the portfolio has remained fairly constant at
AA, while the various sectors contributing to the quality have changed
slightly.
Q: HOW DID THE PORTFOLIO PERFORM DURING THE REPORTING PERIOD COMPARED TO ITS
BENCHMARK?
A: Net of operating expenses, Firstar Intermediate Bond Market Fund's return for
the period was 1.3% (Institutional shares), outperforming its benchmark, the
Lehman Brothers Intermediate Government & Corporate Bond Index, which earned
1.1%.
Q: WHAT IS YOUR OUTLOOK FOR THE CORPORATE BOND MARKET AND THE PORTFOLIO GOING
FORWARD?
A: We believe the Fed will be done tightening by the end of summer which would
allow for a potential rally in bond prices during the second half of the
calendar year. We believe corporate securities spreads have probably reached
their peaks which may allow for their performance relative to Treasuries to
improve for the remainder of the year.
PORTFOLIO MANAGER PROFILE
--------------------------------------------------------------------------------
David Bethke, CFA, Senior Vice President with Firstar Investment Research
& Management Company, LLC (FIRMCO) and Steven Jones, Vice President with FIRMCO,
have co-managed the Fund since February 14, 2000. Mr. Bethke joined Firstar in
1987 and has 19 years of investment management experience. He received a BA from
Upper Iowa University and holds an MBA from the University of Iowa. Mr. Jones
has been with Firstar since 1990 and has 19 years of investment management
experience. He received a BSBA from the University of Missouri and holds an MBA
from Washington University.
92
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Intermediate Bond Market Fund - Institutional
1/5/93 10,000
10/93 10,858
10/94 10,670
10/95 11,978
10/96 12,669
10/97 13,602
10/98 14,665
10/99 14,946
4/00 15,140
This chart assumes an initial investment of $10,000 made on 1/5/93 (inception).
Performance reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced. Performance is shown for Institutional shares, which
have lower expenses than Series A or Series B shares. If those fees and expenses
were reflected in the chart above, total return would have been reduced. Returns
shown include the reinvestment of all dividends and other distributions. Past
performance is not predictive of future performance. Investment return and
principal value will fluctuate, so that your shares, when redeemed, may be worth
more or less than their original cost.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
FISCAL
YEAR-TO-DATE 1 YEAR 3 YEARS 5YEARS SINCE INCEPTION
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FIRSTAR INTERMEDIATE BOND MARKET FUND - INSTITUTIONAL 1.3 1.9 5.5 6.2 5.8 (1/5/93)
FIRSTAR INTERMEDIATE BOND MARKET FUND - A - NO LOAD 1.2 1.6 5.3 5.9 5.6 (1/5/93)
FIRSTAR INTERMEDIATE BOND MARKET FUND - A - LOAD<F1> (2.9) (2.4) 3.8 5.1 5.1 (1/5/93)
FIRSTAR INTERMEDIATE BOND MARKET FUND - B - NO LOAD 0.9 0.9 -- -- 1.7 (3/1/99)
FIRSTAR INTERMEDIATE BOND MARKET FUND - B - LOAD<F2> (4.0) (3.9) -- -- (1.6) (3/1/99)
LEHMAN BROTHERS INTERMEDIATE GOV'T./CORP. BOND INDEX<F3> 1.1 1.6 5.6 6.2 5.9 (1/5/93)
------------------------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class) B = Series B (retail class)
<F1> Reflects maximum sales charge of 4.00%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The Lehman Brothers Intermediate Gov't./Corp. Bond Index is an unmanaged
market value weighted index measuring both principal price changes of, and
income provided by, the underlying universe of securities that comprise the
index. Securities included in the index must meet the following critieria:
fixed as opposed to variable rate; remaining maturity of one to ten years;
minimum outstanding par value of $100 million; and rated investment grade
or higher by Moody's, Standard & Poor's, or Fitch, in that order. An
investment cannot be made directly in an index.
The Lehman Brothers 1-3 Year Government/Corporate Bond Index, the Lehman
Brothers Intermediate Government/Corporate Bond Index and the Lehman
Brothers Government/Corporate Bond Index are trademarks of Lehman Brothers.
The Fund, its Adviser and the Co-Administrators are not affiliated in any
way with Lehman Brothers. Inclusion of a security in a bond index in no way
implies an opinion by Lehman Brothers as to its attractiveness or
appropriateness as an investment. Lehman Brothers' publication of the bond
index is not made in connection with any sale or offer for sale of
securities or any solicitation of orders for the purchase of securities.
Effective at the close of business January 9, 1995, Firstar Funds began to offer
Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.00%
maximum sales load and are subject to an annual 0.25% service organization fee.
The performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995,
does not reflect the service organization fees. If service organization fees had
been reflected, performance would be reduced. Series B shares have a 5.00%
maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
SECTOR DISTRIBUTION
4/30/00
--------------------------------------------------------------------------------
U.S. TREASURY 29%
--------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY 0%
--------------------------------------------------------------------------------
MORTGAGE-BACKED<F1> 5%
--------------------------------------------------------------------------------
FINANCE, BANKING,
BROKERAGE 25%
--------------------------------------------------------------------------------
INDUSTRIAL 10%
--------------------------------------------------------------------------------
UTILITY 1%
--------------------------------------------------------------------------------
INTERNATIONAL/YANKEE 9%
--------------------------------------------------------------------------------
ASSET-BACKED 12%
--------------------------------------------------------------------------------
CASH AND OTHER 9%
--------------------------------------------------------------------------------
TOTAL 100%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
4/30/00
--------------------------------------------------------------------------------
AVERAGE MATURITY 4.9 YEARS
--------------------------------------------------------------------------------
AVERAGE DURATION 3.4 YEARS
--------------------------------------------------------------------------------
<F1> incl. U.S. Gov't. Agency-Backed
QUALITY DISTRIBUTION
4/30/00
--------------------------------------------------------------------------------
U.S. TREASURY 30%
--------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY 1%
--------------------------------------------------------------------------------
Aaa 22%
--------------------------------------------------------------------------------
Aa 9%
--------------------------------------------------------------------------------
A 22%
--------------------------------------------------------------------------------
Baa 16%
--------------------------------------------------------------------------------
Ba 0%
--------------------------------------------------------------------------------
TOTAL 100%
--------------------------------------------------------------------------------
SEC 30-DAY YIELD
--------------------------------------------------------------------------------
INSTITUTIONAL 6.75%
--------------------------------------------------------------------------------
A - NO LOAD 6.49%
--------------------------------------------------------------------------------
A - LOAD 6.23%
--------------------------------------------------------------------------------
B - NO LOAD 5.72%
--------------------------------------------------------------------------------
TOTAL FUND NET ASSETS
4/30/00
--------------------------------------------------------------------------------
$398,047,516
--------------------------------------------------------------------------------
93
<PAGE>
TAX-EXEMPT INTERMEDIATE BOND FUND
Q: WHAT WERE THE CONDITIONS IN THE MUNICIPAL BOND MARKET DURING THE REPORTING
PERIOD?
A: The market was unusually thin in that there were relatively few new issues
traded. Retail demand focused on the shorter end of the yield curve which
caused wide spreads between bid and asked prices on the longer end of the
yield curve. Liquidity on longer maturity securities became costly, and
insurance companies and mutual funds were net sellers of municipal
securities.
Q: HOW DID YOU MANAGE THE PORTFOLIO IN THAT ENVIRONMENT?
A: Firstar Tax-Exempt Intermediate Bond Fund seeks to provide current income
that is substantially exempt from federal income tax and emphasizes total
return with relatively low volatility of principal. The Fund invests
principally in investment-grade intermediate-term municipal obligations
issued by state and local governments which are exempt from federal income
tax. As of April 30, 2000, the maturity mix of the portfolio gives it an
overall average maturity of 4.74 years and an average duration of 4.04 years.
During the reporting period, the Fund's assets were primarily concentrated in
prerefunded securities (67% as of April 30, 2000). These securities are
municipal bonds that hold U.S. Treasury issues in an escrow account, assuring
the timely payment of interest and principal for the prerefunded municipal
bond.
Q: HOW DID YOU MANAGE CREDIT QUALITY DURING THE PERIOD?
A: As a result of the heavy weighting in prerefunded bonds, the Fund's average
credit quality remained high during the period. As of April 30, 2000, the
portfolio's average credit quality was AAA, with 90% of the assets in AAA
securities and the remaining 10% in AA securities.
Q: HOW DID THE PORTFOLIO PERFORM DURING THE PERIOD COMPARED TO ITS BENCHMARK?
A: Net of operating expenses, Firstar Tax-Exempt Intermediate Bond Fund's return
for the period was 1.3% (Institutional shares), while its benchmark, the
Lehman Brothers 5 Year General Obligation Index returned 1.2%.
Q: WHAT IS YOUR OUTLOOK FOR THE MUNICIPAL BOND MARKET AND THE PORTFOLIO GOING
FORWARD?
A: If the market continues to price in additional increases in the Federal Funds
rate, longer-term municipal bonds would be considered relatively more
attractive. Given continued tightenings by the Fed, we would target the first
investment-grade maturity to reach a 6.00% yield while maintaining an
intermediate average maturity for the portfolio as a whole. High credit
quality will also continue to be an important factor in selecting new
investments for the Fund.
PORTFOLIO MANAGER PROFILE
--------------------------------------------------------------------------------
Peter Merzian has managed the Fund since February 14, 2000. Peter has been with
Firstar since 1993 and has 12 years of investment management experience.
94
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Tax-Exempt Intermediate Bond Fund - Institutional
2/8/93 10,000
10/93 10,536
10/94 10,459
10/95 11,440
10/96 11,900
10/97 12,609
10/98 13,351
10/99 13,403
4/00 13,572
This chart assumes an initial investment of $10,000 made on 2/8/93 (inception).
Performance reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced. Performance is shown for Institutional shares, which
have lower expenses than Series A or Series B shares. If those fees and expenses
were reflected in the chart above, total return would have been reduced. Returns
shown include the reinvestment of all dividends and other distributions. Past
performance is not predictive of future performance. Investment return and
principal value will fluctuate, so that your shares, when redeemed, may be worth
more or less than their original cost.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------------
FISCAL
YEAR-TO-DATE 1 YEAR 3 YEARS 5 YEARS SINCE INCEPTION
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FIRSTAR TAX-EXEMPT INTERMEDIATE BOND FUND - INSTITUTIONAL 1.3 0.1 4.0 4.5 4.3 (2/8/93)
FIRSTAR TAX-EXEMPT INTERMEDIATE BOND FUND - A - NO LOAD 1.1 (0.2) 3.7 4.2 4.1 (2/8/93)
FIRSTAR TAX-EXEMPT INTERMEDIATE BOND FUND - A - LOAD<F1> (2.9) (4.2) 2.4 3.4 3.5 (2/8/93)
FIRSTAR TAX-EXEMPT INTERMEDIATE BOND FUND - B - NO LOAD 0.8 (0.8) -- -- (0.7) (3/1/99)
FIRSTAR TAX-EXEMPT INTERMEDIATE BOND FUND - B - LOAD<F2> (4.2) (5.5) -- -- (3.9) (3/1/99)
LEHMAN BROTHERS 5 YEAR GENERAL OBLIGATION BOND INDEX<F3> 1.2 0.4 4.5 5.1 4.9 (2/8/93)
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 4.00%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The Lehman Brothers 5 Year General Obligation Bond Index, an unmanaged
index, is a total return performance benchmark for the investment-grade
tax-exempt bond market. To be included in this index, a municipal bond must
be a state or local General Obligation bond; have a minimum credit rating
of at least Baa; have been issued as part of an offering of at least $50
million; have a maturity amount outstanding of at least $3 million; have
been issued within the last five years; and have a maturity of 4 to 6
years. An investment cannot be made directly in an index.
The Lehman Brothers 1-3 Year Government/Corporate Bond Index, the Lehman
Brothers Intermediate Government/Corporate Bond Index and the Lehman Brothers
Government/Corporate Bond Index are trademarks of Lehman Brothers. The Fund, its
Adviser and the Co-Administrators are not affiliated in any way with Lehman
Brothers. Inclusion of a security in a bond index in no way implies an opinion
by Lehman Brothers as to its attractiveness or appropriateness as an investment.
Lehman Brothers' publication of the bond index is not made in connection with
any sale or offer for sale of securities or any solicitation of orders for the
purchase of securities.
Effective at the close of business January 9, 1995, Firstar Funds began to offer
Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.00%
maximum sales load and are subject to an annual 0.25% service organization fee.
The performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995,
does not reflect the service organization fees. If service organization fees had
been reflected, performance would be reduced. Series B shares have a 5.00%
maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
SECTOR DISTRIBUTION
4/30/00
--------------------------------------------------------------------------------
GENERAL OBLIGATIONS 8%
--------------------------------------------------------------------------------
ESCROWED/PREREFUNDED 67%
--------------------------------------------------------------------------------
INSURED 15%
--------------------------------------------------------------------------------
REVENUE 2%
--------------------------------------------------------------------------------
CASH AND OTHER 8%
--------------------------------------------------------------------------------
TOTAL 100%
--------------------------------------------------------------------------------
QUALITY DISTRIBUTION
4/30/00
--------------------------------------------------------------------------------
Aaa 90%
--------------------------------------------------------------------------------
Aa 10%
--------------------------------------------------------------------------------
TOTAL 100%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
4/30/00
--------------------------------------------------------------------------------
AVERAGE MATURITY 4.7 YEARS
--------------------------------------------------------------------------------
AVERAGE DURATION 4.0 YEARS
--------------------------------------------------------------------------------
SEC 30-DAY YIELD
--------------------------------------------------------------------------------
INSTITUTIONAL 4.59%
--------------------------------------------------------------------------------
A - NO LOAD 4.33%
--------------------------------------------------------------------------------
A - LOAD 4.16%
--------------------------------------------------------------------------------
B - NO LOAD 3.58%
--------------------------------------------------------------------------------
TOTAL FUND NET ASSETS
4/30/00
--------------------------------------------------------------------------------
$83,601,396
--------------------------------------------------------------------------------
95
<PAGE>
BOND IMMDEX(TM) FUND
Q: WHAT WERE THE CONDITIONS IN THE BOND MARKET DURING THE REPORTING PERIOD?
A: Yields generally rose in the short end of the yield curve all the way out to
maturities of 10 years. The long-end of the curve enjoyed a modest rally as
investors bought longer maturity bonds for capital gains and the Treasury
announced a bond buy back program which specifically affected 15-year and
longer maturities. Most other areas of the bond market had rather poor
results including long corporates which experienced widening spreads even
while long treasuries had positive returns.
Q: HOW DID YOU MANAGE THE PORTFOLIO IN THAT ENVIRONMENT?
A: Our structured approach to fixed-income management dictates that we maintain
the portfolio's duration equal to that of our benchmark, the Lehman Brothers
Government & Corporate Bond Index during all market conditions.
As the yield advantage going from long treasuries to other segments became
increasingly more compelling, we re-positioned the portfolio along the curve
to get more weight into the highest yielding areas. We took profits in
long-term treasuries and very short-term securities and bought into the 5- to
7-year treasury and agency bonds which had lagged the market. In this way, we
have overweighted the peak yield sectors while keeping a market weighting in
long-term securities.
Q: HOW DID YOU MANAGE THE PORTFOLIO'S CREDIT QUALITY?
A: The nature of the trades discussed above improved the overall credit quality
as money flowed into treasuries and agencies. The overall credit quality was
not a positive contributor to the return of the portfolio since spreads
between the corporate bonds we held and treasuries mostly widened. Our
corporate bond holdings were also hurt by higher short-term rates and
tightening monetary policy during the period.
Q: HOW DID THE PORTFOLIO PERFORM DURING THE PERIOD COMPARED TO ITS BENCHMARK?
A: Net of operating expenses, Firstar Bond IMMDEX(TM) Fund's return for the
period was 2.0% (Institutional shares), outperforming its benchmark, the
Lehman Brothers Government & Corporate Bond Index which earned 1.5%.
Q: WHAT IS YOUR OUTLOOK FOR THE CORPORATE BOND MARKET AND THE PORTFOLIO GOING
FORWARD?
A: We are hopeful that the recent re-valuation of corporate bonds will move back
to more narrow spreads. The Federal Reserve is still seen as active in
slowing the economy and this will not be good for the market in the short
run. However, if the market begins to perceive that the Fed's work is
finished, spreads will likely tighten and we believe the yield curve will
right itself to our advantage.
PORTFOLIO MANAGER PROFILE
--------------------------------------------------------------------------------
George Schupp, CFA, Senior Vice President and Director of Fixed Income with
Firstar Investment Research &Management Company, LLC (FIRMCO) and David Bethke,
CFA, Senior Vice President with FIRMCO, have co-managed the Fund since February
14, 2000. Mr. Schupp has been with Firstar since 1983 and has 24 years of
investment management experience. He received his BA from the University of
Missouri - St. Louis and holds an MBA from Southern Illinois University. Mr.
Bethke joined Firstar in 1987 and has 19 years of investment management
experience. He received a BA from Upper Iowa University and holds an MBA from
the University of Iowa.
96
<PAGE>
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
Bond IMMDEX(TM) Fund - Institutional
12/29/89 10,000
10/90 10,421
10/91 12,105
10/92 13,376
10/93 15,154
10/94 14,565
10/95 16,934
10/96 17,840
10/97 19,428
10/98 21,256
10/99 21,298
4/00 21,714
This chart assumes an initial investment of $10,000 made on 12/29/89
(inception). Performance reflects fee waivers in effect. In the absence of fee
waivers, total return would be reduced. Performance is shown for Institutional
shares, which have lower expenses than Series A or Series B shares. If those
fees and expenses were reflected in the chart above, total return would have
been reduced. Returns shown include the reinvestment of all dividends and other
distributions. Past performance is not predictive of future performance.
Investment return and principal value will fluctuate, so that your shares, when
redeemed, may be worth more or less than their original cost.
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
FISCAL
YEAR-TO-DATE 1 YEAR 5 YEARS 10 YEARS SINCE INCEPTION
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FIRSTAR BOND IMMDEX(TM) FUND - INSTITUTIONAL 2.0 1.6 6.9 8.3 7.8 (12/29/89)
FIRSTAR BOND IMMDEX(TM) FUND - A - NO LOAD 1.8 1.3 6.6 8.2 7.7 (12/29/89)
FIRSTAR BOND IMMDEX(TM) FUND - A - LOAD<F1> (2.3) (2.8) 5.8 7.7 7.2 (12/29/89)
FIRSTAR BOND IMMDEX(TM) FUND - B - NO LOAD 1.4 0.5 -- -- 1.3 (3/1/99)
FIRSTAR BOND IMMDEX(TM) FUND - B - LOAD<F2> (3.5) (4.2) -- -- (2.0) (3/1/99)
LEHMAN BROTHERS GOV'T/CORP. BOND INDEX<F3> 1.5 1.0 6.7 8.1 7.6 (12/29/89)
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
B = Series B (retail class)
<F1> Reflects maximum sales charge of 4.00%.
<F2> Reflects maximum deferred sales charge of 5.00%.
<F3> The Lehman Brothers Gov't/Corp. Bond is an unmanaged market value weighted
index measuring both principal price changes of, and income provided by,
the underlying universe of securities that comprise the index. Securities
included in the index must meet the following criteria: fixed as opposed to
variable rate; not less than one year to maturity; minimum outstanding par
value of $100 million; and rated investment grade or higher by Moody's,
Standard & Poor's, or Fitch, in that order. An investment cannot be made
directly in an index.
The Lehman Brothers 1-3 Year Government/Corporate Bond Index, the Lehman
Brothers Intermediate Government/Corporate Bond Index and the Lehman Brothers
Government/Corporate Bond Index are trademarks of Lehman Brothers. The Fund, its
Adviser and the Co-Administrators are not affiliated in any way with Lehman
Brothers. Inclusion of a security in a bond index in no way implies an opinion
by Lehman Brothers as to its attractiveness or appropriateness as an investment.
Lehman Brothers' publication of the bond index is not made in connection with
any sale or offer for sale of securities or any solicitation of orders for the
purchase of securities.
Effective at the close of business January 9, 1995, Firstar Funds began to offer
Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.00%
maximum sales load and are subject to an annual 0.25% service organization fee.
The performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995,
does not reflect the service organization fees. If service organization fees had
been reflected, performance would be reduced. Series B shares have a 5.00%
maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
SECTOR DISTRIBUTION
4/30/00
--------------------------------------------------------------------------------
U.S. TREASURY 27%
--------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY 1%
--------------------------------------------------------------------------------
MORTGAGE-BACKED<F1> 5%
--------------------------------------------------------------------------------
FINANCE, BANKING,
BROKERAGE 25%
--------------------------------------------------------------------------------
INDUSTRIAL 16%
--------------------------------------------------------------------------------
UTILITY 5%
--------------------------------------------------------------------------------
INTERNATIONAL/YANKEE 14%
--------------------------------------------------------------------------------
ASSET-BACKED 3%
--------------------------------------------------------------------------------
CASH 4%
--------------------------------------------------------------------------------
TOTAL 100%
--------------------------------------------------------------------------------
PORTFOLIO DISTRIBUTION
4/30/00
--------------------------------------------------------------------------------
AVERAGE MATURITY 9.7 YEARS
--------------------------------------------------------------------------------
AVERAGE DURATION 5.4 YEARS
--------------------------------------------------------------------------------
<F1> incl. U.S. Gov't. Agency-Backed
QUALITY DISTRIBUTION
4/30/00
--------------------------------------------------------------------------------
U.S. TREASURY 28%
--------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY 4%
--------------------------------------------------------------------------------
Aaa 8%
--------------------------------------------------------------------------------
Aa 8%
--------------------------------------------------------------------------------
A 24%
--------------------------------------------------------------------------------
Baa 28%
--------------------------------------------------------------------------------
Ba 0%
--------------------------------------------------------------------------------
TOTAL 100%
--------------------------------------------------------------------------------
SEC 30-DAY YIELD
--------------------------------------------------------------------------------
INSTITUTIONAL 7.12%
--------------------------------------------------------------------------------
A - NO LOAD 6.86%
--------------------------------------------------------------------------------
A - LOAD 6.58%
--------------------------------------------------------------------------------
B - NO LOAD 6.10%
--------------------------------------------------------------------------------
TOTAL FUND NET ASSETS
4/30/00
--------------------------------------------------------------------------------
$512,800,822
97
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE TAX-EXEMPT BOND
BOND MARKET BOND MARKET INTERMEDIATE IMMDEX(TM)
FUND FUND BOND FUND FUND
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
ASSETS:
Investments, at value (cost $177,663, $393,337
$84,137 and $498,895 respectively) ........................... $ 174,567 $ 384,122 $ 82,178 $ 496,039
Cash ............................................................ 1 58 83 --
Interest receivable ............................................. 2,310 5,455 1,455 11,053
Capital shares sold ............................................. 2,050 8,860 10 443
Receivable for securities sold .................................. -- -- -- 6,542
Other assets .................................................... 28 28 30 128
------------ ------------ ------------ ------------
Total Assets ................................................. 178,956 398,523 83,756 514,205
------------ ------------ ------------ ------------
LIABILITIES:
Payable for securities purchased ................................ -- -- -- --
Capital shares redeemed ......................................... 222 111 39 891
Payable to affiliates ........................................... 173 324 98 406
Accrued expenses and other liabilities .......................... 51 40 18 107
------------ ------------ ------------ ------------
Total Liabilities ............................................ 446 475 155 1,404
------------ ------------ ------------ ------------
NET ASSETS ......................................................... $ 178,510 $ 398,048 $ 83,601 $ 512,801
============ ============ ============ ============
NET ASSETS CONSIST OF:
Capital stock ................................................... $ 184,781 $ 406,948 $ 85,695 $ 514,564
Undistributed net investment income ............................. 135 336 46 458
Undistributed accumulated net realized gains (losses) ........... (3,310) (21) (181) 635
Unrealized net appreciation (depreciation) on investments ....... (3,096) (9,215) (1,959) (2,856)
------------ ------------ ------------ ------------
Total Net Assets ............................................. $ 178,510 $ 398,048 $ 83,601 $ 512,801
============ ============ ============ ============
SERIES A:
Net assets ...................................................... $ 54,738 $ 29,683 $ 14,798 $ 83,806
Shares authorized ($.0001 par value) ............................ 500,000 500,000 500,000 500,000
Shares issued and outstanding ................................... 5,458 2,992 1,481 3,104
Net asset value and redemption price per share<F1> .............. $ 10.03 $ 9.92 $ 9.99 $ 27.00
============ ============ ============ ============
Maximum offering price per share <F1> ........................... $ 10.45 $ 10.33 $ 10.41 $ 28.13
============ ============ ============ ============
SERIES B:
Net assets ...................................................... $ 644 $ 267 $ 75 $ 2,182
Shares authorized ($.0001 par value) ............................ 500,000 500,000 500,000 500,000
Shares issued and outstanding ................................... 64 27 8 81
Net asset value, redemption price and offering
price per share <F1> .......................................... $ 10.03 $ 9.92 $ 9.99 $ 26.99
============ ============ ============ ============
SERIES INSTITUTIONAL:
Net assets ...................................................... $ 123,128 $ 368,098 $ 68,728 $ 426,813
Shares authorized ($.0001 par value) ............................ 500,000 500,000 500,000 500,000
Shares issued and outstanding ................................... 12,275 37,103 6,879 15,800
Net asset value, redemption price and offering
price per share <F1> ......................................... $ 10.03 $ 9.92 $ 9.99 $ 27.01
============ ============ ============ ============
<F1> Amounts may not recalculate due to rounding
</TABLE>
See notes to the financial statements.
98
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
(Amounts in thousands)
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE
BOND MARKET BOND MARKET
FUND FUND
--------------- --------------- --------------- ---------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APR. 30, 2000 OCT. 31, 1999 APR. 30, 2000 OCT. 31, 1999
--------------- --------------- --------------- ---------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income ............................... $ 5,362 $ 11,031 $ 11,438 $ 18,045
Net realized gain (loss) on investments ............. (294) (684) 160 (230)
Net change in unrealized appreciation
(depreciation) on investments .................... (1,437) (3,714) (6,526) (11,981)
--------------- --------------- --------------- ---------------
Net increase in net assets
resulting from operations ........................ 3,631 6,633 5,072 5,834
--------------- --------------- --------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ......................................... 16,579 53,639 137,016 71,398
Shares issued to owners in
reinvestment of dividends ........................ 3,958 8,699 5,923 10,859
Shares redeemed ..................................... (36,929) (57,459) (56,673) (72,617)
--------------- --------------- --------------- ---------------
Net increase (decrease) in net assets resulting
from capital share transactions .................. (16,392) 4,879 86,266 9,640
--------------- --------------- --------------- ---------------
Distributions to Series A shareholders:
From net investment income<F1> ...................... (1,652) (3,882) (934) (1,821)
From net realized gains ............................. -- -- -- (30)
--------------- --------------- --------------- ---------------
(1,652) (3,882) (934) (1,851)
--------------- --------------- --------------- ---------------
Distributions to Series B shareholders:
From net investment income<F1> ...................... (14) (12) (6) (5)
From net realized gains ............................. -- -- -- --
--------------- --------------- --------------- ---------------
(14) (12) (6) (5)
--------------- --------------- --------------- ---------------
Distributions to Series institutional shareholders:
From net investment income<F1> ...................... (3,681) (7,103) (10,382) (16,154)
From net realized gains ............................. -- -- -- (271)
--------------- --------------- --------------- ---------------
(3,681) (7,103) (10,382) (16,425)
--------------- --------------- --------------- ---------------
TOTAL INCREASE (Decrease)IN NET ASSETS ................. (18,108) 515 80,016 (2,807)
NET ASSETS:
Beginning of period ................................. 196,618 196,103 318,032 320,839
--------------- --------------- --------------- ---------------
End of period (including undistributed net
investment income of $135, $120, $336, $220,
$46, $33, $458, and $377, respectively) .......... $ 178,510 $ 196,618 $ 398,048 $ 318,032
=============== =============== =============== ===============
</TABLE>
<TABLE>
<CAPTION>
TAX-EXEMPT BOND
INTERMEDIATE BOND IMMDEX(TM)
FUND FUND
--------------- --------------- --------------- ---------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APR. 30, 2000 OCT. 31, 1999 APR. 30, 2000 OCT. 31, 1999
--------------- --------------- --------------- ---------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income ............................... $ 1,860 $ 3,948 $ 16,921 $ 31,584
Net realized gain (loss) on investments ............. (181) 293 901 (54)
Net change in unrealized appreciation
(depreciation) on investments .................... (595) (3,854) (7,876) (30,858)
--------------- --------------- --------------- ---------------
Net increase in net assets
resulting from operations ........................ 1,084 387 9,946 672
--------------- --------------- --------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Shares sold ......................................... 22,822 30,647 87,213 191,150
Shares issued to owners in
reinvestment of dividends ........................ 816 1,857 12,587 24,755
Shares redeemed ..................................... (24,107) (42,638) (99,506) (232,395)
--------------- --------------- --------------- ---------------
Net increase (decrease) in net assets resulting
from capital share transactions .................. (469) (10,134) 294 (16,490)
--------------- --------------- --------------- ---------------
Distributions to Series A shareholders:
From net investment income<F1> ...................... (357) (1,181) (2,783) (5,786)
From net realized gains ............................. (66) (29) -- --
--------------- --------------- --------------- ---------------
(423) (1,210) (2,783) (5,786)
--------------- --------------- --------------- ---------------
Distributions to Series B shareholders:
From net investment income<F1> ...................... (1) (1) (55) (44)
From net realized gains ............................. -- -- -- --
--------------- --------------- --------------- ---------------
(1) (1) (55) (44)
--------------- --------------- --------------- ---------------
Distributions to Series institutional shareholders:
From net investment income<F1> ...................... (1,489) (2,759) (14,002) (25,677)
From net realized gains ............................. (225) (52) -- --
--------------- --------------- --------------- ---------------
(1,714) (2,811) (14,002) (25,677)
--------------- --------------- --------------- ---------------
TOTAL INCREASE (Decrease)IN NET ASSETS ................. (1,523) (13,769) (6,600) (47,325)
NET ASSETS:
Beginning of period ................................. 85,124 98,893 519,401 566,726
--------------- --------------- --------------- ---------------
End of period (including undistributed net
investment income of $135, $120, $336, $220,
$46, $33, $458, and $377, respectively) .......... $ 83,601 $ 85,124 $ 512,801 $ 519,401
=============== =============== =============== ===============
</TABLE>
<F1> For the Tax-Exempt Intermediate Bond Fund, substantially all distributions
from net investment income are exempt from federal income tax.
99
<PAGE>
STATEMENT OF OPERATIONS
(AMOUNTS IN THOUSANDS)
SIX MONTHS ENDED APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE TAX-EXEMPT BOND
BOND MARKET BOND MARKET INTERMEDIATE IMMDEX(TM)
FUND FUND BOND FUND FUND
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income ................................................. $ 5,977 $ 12,515 $ 2,169 $ 18,304
EXPENSES:
Investment advisory fees ........................................ 566 908 214 781
Administration fees ............................................. 101 194 46 278
Transfer agent fees and expenses ................................ 24 26 21 36
Fund accounting fees ............................................ 46 56 31 66
Service organization fees - Series A ............................ 75 40 22 112
Service organization fees - Series B ............................ 1 1 -- 2
12b-1 fees - Series B ........................................... 2 1 -- 7
Custody fees .................................................... 15 24 10 33
Federal and state registration fees ............................. 14 18 17 15
Professional fees ............................................... 20 22 20 23
Reports to shareholders ......................................... 14 5 6 20
Directors' fees and expenses .................................... 4 4 4 5
Other ........................................................... 3 4 1 5
------------ ------------ ------------ ------------
Total expenses before waiver .................................... 885 1,303 392 1,383
Less: Waiver of expenses ..................................... (270) (226) (83) --
------------ ------------ ------------ ------------
Net expenses ................................................. 615 1,077 309 1,383
------------ ------------ ------------ ------------
NET INVESTMENT INCOME .............................................. 5,362 11,438 1,860 16,921
------------ ------------ ------------ ------------
REALIZED AND UNREALIZED Gain (LOSS):
Net realized gain (loss) on investment transactions ............. (294) 160 (181) 901
Net change in unrealized depreciation
on investments .................................................. (1,437) (6,526) (595) (7,876)
------------ ------------ ------------ ------------
Net (loss) on investments .................................... (1,730) (6,366) (776) (6,975)
------------ ------------ ------------ ------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ....................................... $ 3,631 $ 5,072 $ 1,084 $ 9,946
============ ============ ============ ============
</TABLE>
See notes to the financial statements.
100
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK.
101
<PAGE>
FINANCIAL HIGHLIGHTS
INSTITUTIONAL
BOND FUNDS
PER SHARE DATA
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
-------------------------------------------
NET NET REALIZED AND
ASSET VALUE, NET UNREALIZED GAINS TOTAL FROM
BEGINNING INVESTMENT OR (LOSSES) ON INVESTMENT
OF PERIOD INCOME(1) SECURITIES OPERATIONS
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
SHORT-TERM BOND MARKET
Year Ended October 31, 1995<F6>............ $ 10.03 $ 0.63 $ 0.24 $ 0.87
Year Ended October 31, 1996 ............... 10.28 0.617 (0.03) 0.58
Year Ended October 31, 1997 ............... 10.25 0.62 0.02 0.64
Year Ended October 31, 1998 ............... 10.27 0.61 0.07 0.68
Year Ended October 31, 1999 ............... 10.34 0.56 (0.22) 0.34
Six Months Ended April 30, 2000 (unaudited) 10.12 0.29 (0.09) 0.20
INTERMEDIATE BOND MARKET
Year Ended October 31, 1995<F6>............ 9.67 0.62 0.53 1.15
Year Ended October 31, 1996 ............... 10.21 0.59<F7> (0.02) 0.57
Year Ended October 31, 1997 ............... 10.19 0.60 0.12 0.72
Year Ended October 31, 1998 ............... 10.31 0.59 0.19 0.78
Year Ended October 31, 1999 ............... 10.50 0.59 (0.39) 0.20
Six Months Ended April 30, 2000 (unaudited) 10.10 0.31 (0.18) 0.13
TAX-EXEMPT INTERMEDIATE BOND
Year Ended October 31, 1995<F6>............ 9.78 0.44 0.46 0.90
Year Ended October 31, 1996 ............... 10.24 0.43<F7> (0.03) 0.40
Year Ended October 31, 1997 ............... 10.21 0.44 0.15 0.59
Year Ended October 31, 1998 ............... 10.36 0.44 0.16 0.60
Year Ended October 31, 1999 ............... 10.52 0.44 (0.40) 0.04
Six Months Ended April 30, 2000 (unaudited) 10.12 0.22 (0.09) 0.13
BOND IMMDEX(TM)
Year Ended October 31, 1995<F6>............ 25.67 1.74 2.29 4.03
Year Ended October 31, 1996 ............... 27.82 1.70<F7> (0.27) 1.43
Year Ended October 31, 1997 ............... 27.55 1.75 0.61 2.36
Year Ended October 31, 1998 ............... 28.16 1.72 0.85 2.57
Year Ended October 31, 1999 ............... 29.02 1.70 (1.65) 0.05
Six Months Ended April 30, 2000 (unaudited) 27.37 0.89 (0.37) 0.52
</TABLE>
<TABLE>
<CAPTION>
LESS DISTRIBUTIONS
--------------------------------------------
DIVIDENDS DISTRIBUTIONS
FROM NET FROM NET ASSET
INVESTMENT CAPITAL TOTAL VALUE, END TOTAL
INCOME GAINS DISTRIBUTIONS OF PERIOD RETURN
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
SHORT-TERM BOND MARKET
Year Ended October 31, 1995<F6>............ $ (0.62) $ -- $ (0.62) $ 10.28 8.95%
Year Ended October 31, 1996 ............... (0.61) -- (0.61) 10.25 5.80%
Year Ended October 31, 1997 ............... (0.62) -- (0.62) 10.27 6.47%
Year Ended October 31, 1998 ............... (0.61) -- (0.61) 10.34 6.84%
Year Ended October 31, 1999 ............... (0.56) -- (0.56) 10.12 3.42%
Six Months Ended April 30, 2000 (unaudited) (0.29) -- (0.29) 10.03 2.02%<F9>
INTERMEDIATE BOND MARKET
Year Ended October 31, 1995<F6>............ (0.61) -- (0.61) 10.21 12.25%
Year Ended October 31, 1996 ............... (0.59) -- (0.59) 10.19 5.77%
Year Ended October 31, 1997 ............... (0.60) -- (0.60) 10.31 7.36%
Year Ended October 31, 1998 ............... (0.59) -- (0.59) 10.50 7.83%
Year Ended October 31, 1999 ............... (0.59) (0.01) (0.60) 10.10 1.91%
Six Months Ended April 30, 2000 (unaudited) (0.31) -- (0.31) 9.92 1.30%<F9>
TAX-EXEMPT INTERMEDIATE BOND
Year Ended October 31, 1995<F6>............ (0.44) -- (0.44) 10.24 9.38%
Year Ended October 31, 1996 ............... (0.43) -- (0.43) 10.21 4.02%
Year Ended October 31, 1997 ............... (0.44) -- (0.44) 10.36 5.96%
Year Ended October 31, 1998 ............... (0.44) -- (0.44) 10.52 5.88%
Year Ended October 31, 1999 ............... (0.43) (0.01) (0.44) 10.12 0.39%
Six Months Ended April 30, 2000 (unaudited) (0.22) (0.04) (0.26) 9.99 1.26%<F9>
BOND IMMDEX(TM)
Year Ended October 31, 1995<F6>............ (1.84) (0.04) (1.88) 27.82 16.26%
Year Ended October 31, 1996 ............... (1.70) -- (1.70) 27.55 5.35%
Year Ended October 31, 1997 ............... (1.75) -- (1.75) 28.16 8.90%
Year Ended October 31, 1998 ............... (1.71) -- (1.71) 29.02 9.41%
Year Ended October 31, 1999 ............... (1.70) -- (1.70) 27.37 0.20%
Six Months Ended April 30, 2000 (unaudited) (0.88) -- (0.88) 27.01 1.95%<F9>
</TABLE>
<TABLE>
<CAPTION>
SUPPLEMENTAL DATA AND RATIOS
-----------------------------------------------------------------
RATIO OF NET
NET ASSETS, RATIO OF NET INVESTMENT
END OF EXPENSES INCOME PORTFOLIO
PERIOD TO AVERAGE TO AVERAGE TURNOVER
(000S) NET ASSETS NET ASSETS RATE(8)
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
SHORT-TERM BOND MARKET
Year Ended October 31, 1995<F6>............ $ 94,959 0.50%<F2> 6.23%<F2> 100.58%
Year Ended October 31, 1996 ............... 147,466 0.50%<F2> 5.92%<F2> 59.62%
Year Ended October 31, 1997 ............... 136,084 0.50%<F2> 6.04%<F2> 77.12%
Year Ended October 31, 1998 ............... 120,693 0.50%<F2> 5.92%<F2> 78.20%
Year Ended October 31, 1999 ............... 130,611 0.56%<F2> 5.52%<F2> 52.28%
Six Months Ended April 30, 2000 (unaudited) 123,128 0.57%<F2> 5.78%<F2> 33.23%<F9>
INTERMEDIATE BOND MARKET
Year Ended October 31, 1995<F6>.............. 128,941 0.50%<F3> 6.26%<F3> 66.69%
Year Ended October 31, 1996 ............... 173,468 0.50%<F3> 5.84%<F3> 59.29%
Year Ended October 31, 1997 ............... 254,521 0.50%<F3> 5.96%<F3> 40.61%
Year Ended October 31, 1998 ............... 291,289 0.50%<F3> 5.75%<F3> 27.29%
Year Ended October 31, 1999 ............... 284,047 0.56%<F3> 5.71%<F3> 64.07%
Six Months Ended April 30, 2000 (unaudited) 368,098 0.57%<F3> 6.31%<F3> 46.03%<F9>
TAX-EXEMPT INTERMEDIATE BOND
Year Ended October 31, 1995<F6>............ 27,595 0.51%<F4> 4.45%<F4> 44.13%
Year Ended October 31, 1996 ............... 36,652 0.50%<F4> 4.24%<F4> 30.46%
Year Ended October 31, 1997 ............... 52,208 0.50%<F4> 4.36%<F4> 11.22%
Year Ended October 31, 1998 ............... 66,427 0.50%<F4> 4.25%<F4> 14.38%
Year Ended October 31, 1999 ............... 65,034 0.64%<F4> 4.16%<F4> 21.77%
Six Months Ended April 30, 2000 (unaudited) 68,728 0.67%<F4> 4.39%<F4> 10.68%<F9>
BOND IMMDEX(TM)
Year Ended October 31, 1995<F6>............ 290,274 0.44%<F5> 6.51%<F5> 41.67%
Year Ended October 31, 1996 ............... 370,556 0.43%<F5> 6.23%<F5> 33.38%
Year Ended October 31, 1997 ............... 408,018 0.42%<F5> 6.33%<F5> 35.12%
Year Ended October 31, 1998 ............... 471,425 0.42%<F5> 6.02%<F5> 20.07%
Year Ended October 31, 1999 ............... 421,897 0.47%<F5> 6.05%<F5> 57.04%
Six Months Ended April 30, 2000 (unaudited) 426,813 0.48%<F5> 6.55%<F5> 33.11%<F9>
</TABLE>
<F1> For the Tax-Exempt Intermediate Bond Fund, substantially all investment
income is exempt from federal income tax.
<F2> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 0.86%, 0.84%, 0.86%, 0.86%,
0.87%, 0.91%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 5.48%,
5.24%, 5.56%, 5.68%, 5.55%, 5.82%, respectively.
<F3> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 0.69%, 0.70%, 0.71%, 0.73%,
0.74%, 0.79%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 6.19%,
5.57%, 5.54%, 5.73%, 5.60%, 5.97%, respectively.
<F4> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 0.86%, 0.82%, 0.81%, 0.88%,
0.97%, 1.00%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 4.20%,
3.98%, 3.94%, 3.98%, 3.77%, 3.96%, respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31,
1999, 1998, 1997, 1996, 1995 would have been 0.48%, 0.48%, 0.49%, 0.49%,
0.50%, 0.51%, respectively; and ratios of net investment income to average
net assets for the period ended April 30, 2000 and for the fiscal years
ended October 31, 1999, 1998, 1997, 1996, 1995 would have been 6.55%,
6.04%, 5.95%, 6.26%, 6.16%, 6.44%, respectively.
102
<PAGE>
<F6> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of the
close of business on January 9, 1995, and the results thereof combined with
the results of operations and distributions for each applicable class for
the period January 10, 1995, through October 31, 1995.
<F7> Net investment income per share is calculated using ending balances prior
to consideration of adjustments for permanent book and tax differences.
<F8> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
<F9> Not annualized.
See notes to the financial statements.
103
<PAGE>
FINANCIAL HIGHLIGHTS
RETAIL A SHARE
BOND FUNDS
PER SHARE DATA
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
----------------------------------------------
NET NET REALIZED AND
ASSET VALUE, NET UNREALIZED GAINS TOTAL FROM
BEGINNING INVESTMENT OR (LOSSES) ON INVESTMENT
OF PERIOD INCOME(1) SECURITIES OPERATIONS
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
SHORT-TERM BOND MARKET
Year Ended October 31, 1995<F7>............ $ 10.03 $ 0.61 $ 0.24 $ 0.85
Year Ended October 31, 1996 ............... 10.28 0.58<F8> (0.03) 0.55
Year Ended October 31, 1997 ............... 10.25 0.60 0.02 0.62
Year Ended October 31, 1998 ............... 10.27 0.58 0.07 0.65
Year Ended October 31, 1999 ............... 10.34 0.54 (0.22) 0.32
Six Months Ended April 30, 2000 (unaudited) 10.12 0.28 (0.09) 0.19
INTERMEDIATE BOND MARKET
Year Ended October 31, 1995<F7>............ 9.67 0.60 0.53 1.13
Year Ended October 31, 1996 ............... 10.21 0.56<F8> (0.02) 0.54
Year Ended October 31, 1997 ............... 10.19 0.58 0.12 0.70
Year Ended October 31, 1998 ............... 10.31 0.57 0.19 0.76
Year Ended October 31, 1999 ............... 10.50 0.56 (0.39) 0.17
Six Months Ended April 30, 2000 (unaudited) 10.10 0.30 (0.18) 0.12
TAX-EXEMPT INTERMEDIATE BOND
Year Ended October 31, 1995<F7>............ 9.78 0.42 0.45 0.87
Year Ended October 31, 1996 ............... 10.23 0.40<F8> (0.01) 0.39
Year Ended October 31, 1997 ............... 10.21 0.42 0.14 0.56
Year Ended October 31, 1998 ............... 10.35 0.41 0.17 0.58
Year Ended October 31, 1999 ............... 10.52 0.42 (0.40) 0.02
Six Months Ended April 30, 2000 (unaudited) 10.12 0.21 (0.09) 0.12
BOND IMMDEX(TM)
Year Ended October 31, 1995<F7>............ 25.67 1.68 2.30 3.98
Year Ended October 31, 1996 ............... 27.82 1.61<F8> (0.26) 1.35
Year Ended October 31, 1997 ............... 27.54 1.66 0.64 2.30
Year Ended October 31, 1998 ............... 28.16 1.64 0.85 2.49
Year Ended October 31, 1999 ............... 29.01 1.64 (1.66) (0.02)
Six Months Ended April 30, 2000 (unaudited) 27.36 0.86 (0.37) 0.49
<F1> For the Tax-Exempt Intermediate Bond Fund, substantially all investment
income is exempt from federal income tax.
<F2> The total return calculation does not reflect the maximum sales charge of
4.00%.
<F3> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31, 1999,
1998, 1997, 1996, 1995 would have been 1.11%, 1.09%, 1.11%, 1.11%, 1.12%,
1.10%, respectively; and ratios of net investment income to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997, 1996, 1995 would have been 5.24%, 4.99%,
5.31%, 5.43%, 5.30%, 5.63%, respectively.
<F4> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31, 1999,
1998, 1997, 1996, 1995 would have been 0.94%, 0.95%, 0.96%, 0.98%, 0.99%,
0.98%, respectively; and ratios of net investment income to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997, 1996 and 1995 would have been 5.94%, 5.33%,
5.29%, 5.48%, 5.35%, 5.78%, respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31, 1999,
1998, 1997, 1996, 1995 would have been 1.11%, 1.07%, 1.06%, 1.13%, 1.22%,
1.20%, respectively; and ratios of net investment income to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997, 1996, 1995 would have been 3.95%, 3.73%,
3.69%, 3.73%, 3.52%, 3.76%, respectively.
</TABLE>
See notes to the financial statements.
104
<PAGE>
<TABLE>
<CAPTION>
LESS DISTRIBUTIONS
--------------------------------------------
DIVIDENDS DISTRIBUTIONS
FROM NET FROM NET ASSET
INVESTMENT CAPITAL TOTAL VALUE, END TOTAL
INCOME GAINS DISTRIBUTIONS OF PERIOD RETURN<F2>
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
SHORT-TERM BOND MARKET
Year Ended October 31, 1995<F7>............ $ (0.60) $ -- $ (0.60) $ 10.28 8.74%
Year Ended October 31, 1996 ............... (0.58) -- (0.58) 10.25 5.54%
Year Ended October 31, 1997 ............... (0.60) -- (0.60) 10.27 6.21%
Year Ended October 31, 1998 ............... (0.58) -- (0.58) 10.34 6.58%
Year Ended October 31, 1999 ............... (0.54) -- (0.54) 10.12 3.16%
Six Months Ended April 30, 2000 (unaudited) (0.28) -- (0.28) 10.03 1.89%<F10>
INTERMEDIATE BOND MARKET
Year Ended October 31, 1995<F7>............ (0.59) -- (0.59) 10.21 12.04%
Year Ended October 31, 1996 ............... (0.56) -- (0.56) 10.19 5.51%
Year Ended October 31, 1997 ............... (0.58) -- (0.58) 10.31 7.09%
Year Ended October 31, 1998 ............... (0.57) -- (0.57) 10.50 7.57%
Year Ended October 31, 1999 ............... (0.56) (0.01) (0.57) 10.10 1.66%
Six Months Ended April 30, 2000 (unaudited) (0.30) -- (0.30) 9.92 1.17%<F10>
TAX-EXEMPT INTERMEDIATE BOND
Year Ended October 31, 1995<F7>............ (0.42) -- (0.42) 10.23 9.07%
Year Ended October 31, 1996 ............... (0.41) -- (0.41) 10.21 3.87%
Year Ended October 31, 1997 ............... (0.42) -- (0.42) 10.35 5.60%
Year Ended October 31, 1998 ............... (0.41) -- (0.41) 10.52 5.73%
Year Ended October 31, 1999 ............... (0.41) (0.01) (0.42) 10.12 0.14%
Six Months Ended April 30, 2000 (unaudited) (0.21) (0.04) (0.25) 9.99 1.14%<F10>
BOND IMMDEX(TM)
Year Ended October 31, 1995<F7>............ (1.79) (0.04) (1.83) 27.82 16.05%
Year Ended October 31, 1996 ............... (1.63) -- (1.63) 27.54 5.06%
Year Ended October 31, 1997 ............... (1.68) -- (1.68) 28.16 8.68%
Year Ended October 31, 1998 ............... (1.64) -- (1.64) 29.01 9.11%
Year Ended October 31, 1999 ............... (1.63) -- (1.63) 27.36 (0.05)%
Six Months Ended April 30, 2000 (unaudited) (0.85) -- (0.85) 27.00 1.82%<F10>
</TABLE>
<TABLE>
<CAPTION>
SUPPLEMENTAL DATA AND RATIOS
-----------------------------------------------------------------
RATIO OF NET
NET ASSETS, RATIO OF NET INVESTMENT
END OF EXPENSES INCOME PORTFOLIO
PERIOD TO AVERAGE TO AVERAGE TURNOVER
(000S) NET ASSETS NET ASSETS RATE(9)
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
SHORT-TERM BOND MARKET
Year Ended October 31, 1995<F7>............ $ 47,730 0.69%<F3> 6.04%<F3> 100.58%
Year Ended October 31, 1996 ............... 58,843 0.75%<F3> 5.67%<F3> 59.62%
Year Ended October 31, 1997 ............... 65,567 0.75%<F3> 5.79%<F3> 77.12%
Year Ended October 31, 1998 ............... 75,410 0.75%<F3> 5.67%<F3> 78.20%
Year Ended October 31, 1999 ............... 65,490 0.81%<F3> 5.27%<F3> 52.28%
Six Months Ended April 30, 2000 (unaudited) 54,738 0.82%<F3> 5.53%<F3> 33.23%<F10>
INTERMEDIATE BOND MARKET
Year Ended October 31, 1995<F7>............ 11,576 0.69%<F4> 6.07%<F4> 66.69%
Year Ended October 31, 1996 ............... 17,392 0.75%<F4> 5.59%<F4> 59.29%
Year Ended October 31, 1997 ............... 20,691 0.75%<F4> 5.71%<F4> 40.61%
Year Ended October 31, 1998 ............... 29,550 0.75%<F4> 5.50%<F4> 27.29%
Year Ended October 31, 1999 ............... 33,779 0.81%<F4> 5.47%<F4> 64.07%
Six Months Ended April 30, 2000 (unaudited) 29,683 0.82%<F4> 6.06%<F4> 46.03%<F10>
TAX-EXEMPT INTERMEDIATE BOND
Year Ended October 31, 1995<F7>............ 7,711 0.71%<F5> 4.25%<F5> 44.13%
Year Ended October 31, 1996 ............... 10,690 0.75%<F5> 3.99%<F5> 30.46%
Year Ended October 31, 1997 ............... 19,199 0.75%<F5> 4.11%<F5> 11.22%
Year Ended October 31, 1998 ............... 32,466 0.75%<F5> 4.00%<F5> 14.38%
Year Ended October 31, 1999 ............... 20,016 0.89%<F5> 3.91%<F5> 21.77%
Six Months Ended April 30, 2000 (unaudited) 14,798 0.92%<F5> 4.14%<F5> 10.68%<F10>
BOND IMMDEX(TM)
Year Ended October 31, 1995<F7>............ 21,875 0.64%<F6> 6.31%<F6> 41.67%
Year Ended October 31, 1996 ............... 42,671 0.68%<F6> 5.98%<F6> 33.38%
Year Ended October 31, 1997 ............... 64,144 0.67%<F6> 6.08%<F6> 35.12%
Year Ended October 31, 1998 ............... 95,301 0.67%<F6> 5.77%<F6> 20.07%
Year Ended October 31, 1999 ............... 95,635 0.72%<F6> 5.80%<F6> 57.04%
Six Months Ended April 30, 2000 (unaudited) 83,806 0.73%<F6> 6.30%<F6> 33.11%<F10>
<F6> Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31, 1999,
1998, 1997, 1996, 1995 would have been 0.73%, 0.74%, 0.74%, 0.74%, 0.75%,
0.71%, respectively; and ratios of net investment income to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997, 1996, 1995 would have been 6.30%, 5.78%,
5.70%, 6.01%, 5.91%, 6.24%, respectively.
<F7> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios of
net investment income to average net assets, total return and the per share
income from investment operations and distributions are presented on a basis
whereby the Funds' net investment income, net expenses, net realized and
unrealized gains (losses) and distributions for the period November 1, 1994
through January 9, 1995, were allocated to each class of shares based upon
the relative net assets of each class of shares as of the close of business
operations and distributions for each applicable class for the period
January 10, 1995 through October 31, 1995.
<F8> Net investment income per share is calculated using ending balances prior to
consideration of adjustments for permanent book and tax differences.
<F9> Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing between the classes of shares issued.
<F10> Not annualized.
</TABLE>
105
<PAGE>
FINANCIAL HIGHLIGHTS
RETAIL B SHARE
BOND FUNDS
PER SHARE DATA
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
-------------------------------------------
NET NET REALIZED AND
ASSET VALUE, NET UNREALIZED GAINS TOTAL FROM
BEGINNING INVESTMENT OR (LOSSES) ON INVESTMENT
OF PERIOD INCOME<F2> SECURITIES OPERATIONS
------------ ------------ ------------ ------------
SHORT-TERM BOND MARKET
<S> <C> <C> <C> <C>
March 1, 1999(1) through October 31, 1999 $ 10.23 $ 0.31<F10> $ (0.09) $ 0.22
Six Months Ended April 30, 2000 (unaudited) 10.12 0.22 (0.07) 0.15
INTERMEDIATE BOND MARKET
March 1, 1999(1) through October 31, 1999 10.31 0.31<F10> (0.21) 0.10
Six Months Ended April 30, 2000 (unaudited) 10.09 0.27<F10> (0.18) 0.09
TAX-EXEMPT INTERMEDIATE BOND
March 1, 1999(1) through October 31, 1999 10.51 0.22<F10> (0.38) (0.16)
Six Months Ended April 30, 2000 (unaudited) 10.12 0.17<F10> (0.09) 0.09
BOND IMMDEX(TM)
March 1, 1999<F1> through October 31, 1999 28.34 0.92<F10> (0.91) 0.01
Six Months Ended April 30, 2000 (unaudited) 27.36 0.76 (0.36) 0.40
<F1> Commencement of operations.
<F2> For the Tax-Exempt Intermediate Bond Fund, substantially all investment
income is exempt from federal income tax.
<F3> The total return calculation does not reflect the maximum deferred sales
charge of 5.00%.
<F4> Without fees waived, ratio of net expenses to average net assets for the
periods ended April 30, 2000 and October 31, 1999 would have been 1.86%,
1.85%, respectively; and ratio of net investment income for the periods
ended April 30, 2000 and October 31, 1999 would have been 4.50%, 4.30%,
respectively.
<F5> Without fees waived, ratio of net expenses to average net assets for the
periods ended April 30, 2000 and October 31, 1999 would have been 1.69%,
1.71%, respectively; and ratio of net investment income for the periods
ended April 30, 2000 and October 31, 1999 would have been 5.20%, 4.73%,
respectively.
<F6> Without fees waived, ratio of net expenses to average net assets for the
periods ended April 30, 2000 and October 31, 1999 would have been 1.86%,
1.85%, respectively; and ratio of net investment income for the periods
ended April 30, 2000 and October 31, 1999 would have been 3.20%, 3.07%,
respectively.
<F7> Not annualized.
<F8> Annualized.
<F9> Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing between the classes of shares issued.
<F10> Net investment income per share represents net investment income dividend
by the average shares outstanding throughout the period.
</TABLE>
See note to the financial statements.
106
<PAGE>
<TABLE>
<CAPTION>
LESS DISTRIBUTIONS
--------------------------------------------
DIVIDENDS DISTRIBUTIONS
FROM NET FROM NET ASSET
INVESTMENT CAPITAL TOTAL VALUE, END TOTAL
INCOME GAINS DISTRIBUTIONS OF PERIOD RETURN<F3>
------------ ------------ ------------ ------------ ------------
SHORT-TERM BOND MARKET
<S> <C> <C> <C> <C> <C>
March 1, 1999<F1> through October 31, 1999 $ (0.33) $ -- $ (0.33) $ 10.12 2.18%<F7>
Six Months Ended April 30, 2000 (unaudited) (0.24) -- (0.24) 10.03 1.48%<F7>
INTERMEDIATE BOND MARKET
March 1, 1999<F1> through October 31, 1999 (0.32) -- (0.32) 10.09 1.02%<F7>
Six Months Ended April 30, 2000 (unaudited) (0.26) -- (0.26) 9.92 0.92%<F7>
TAX-EXEMPT INTERMEDIATE BOND
March 1, 1999<F1> through October 31, 1999 (0.23) -- (0.23) 10.12 (1.55)%<F7>
Six Months Ended April 30, 2000 (unaudited) (0.18) (0.04) (0.22) 9.99 0.77%<F7>
BOND IMMDEX(TM)
March 1, 1999<F1> through October 31, 1999 (0.99) -- (0.99) 27.36 0.04%<F7>
Six Months Ended April 30, 2000 (unaudited) (0.77) -- (0.77) 26.99 1.43%<F7>
</TABLE>
<TABLE>
<CAPTION>
SUPPLEMENTAL DATA AND RATIOS
---------------------------------------------------------------------
RATIO OF NET
NET ASSETS, RATIO OF NET INVESTMENT
END OF EXPENSES INCOME PORTFOLIO
PERIOD TO AVERAGE TO AVERAGE TURNOVER
(000S) NET ASSETS NET ASSETS RATE<F7><F9>
------------ ------------ ------------ ------------
SHORT-TERM BOND MARKET
<S> <C> <C> <C> <C>
March 1, 1999<F1> through October 31, 1999 $ 517 1.57%<F4><F8> 4.58%<F4><F8> 52.28%
Six Months Ended April 30, 2000 (unaudited) 644 1.57%<F4><F8> 4.79%<F4><F8> 33.23%
INTERMEDIATE BOND MARKET
March 1, 1999<F1> through October 31, 1999 206 1.57%<F5><F8> 4.87%<F5><F8> 64.07%
Six Months Ended April 30, 2000 (unaudited) 267 1.57%<F5><F8> 5.32%<F5><F8> 46.03%
TAX-EXEMPT INTERMEDIATE BOND
March 1, 1999<F1> through October 31, 1999 74 1.67%<F6><F8> 3.25%<F6><F8> 21.77%
Six Months Ended April 30, 2000 (unaudited) 75 1.67%<F6><F8> 3.39%<F6><F8> 10.68%
BOND IMMDEX(TM)
March 1, 1999<F1> through October 31, 1999 1,869 1.49%<F8> 5.06%<F8> 57.04%
Six Months Ended April 30, 2000 (unaudited) 2,182 1.48%<F8> 5.55%<F8> 33.11%
</TABLE>
See notes to the financial statements.
107
<PAGE>
SHORT-TERM BOND MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
LONG-TERM INVESTMENTS 96.1%
ASSET-BACKED SECURITIES 33.0%
AUTO LOAN RECEIVABLES 1.9%
Honda Auto Lease Trust,
$3,500 Series 1999-A, Class A5, 6.65%, 7/15/05 $ 3,463
--------------
CREDIT CARD RECEIVABLES 12.6%
AT&T Universal Card Master Trust,
520 5.95%, 10/17/02 518
Banc One Credit Card Master Trust,
2,000 Series 1995-B, Class A, 6.30%, 9/15/00 1,997
Chemical Master Credit Card Trust I,
3,060 Series 1995-2, Class A, 6.23%, 6/15/03 3,053
Citibank Credit Card Master Trust I, Principal Only:
5,220 Series 1996-1, Class A, 0.00%, 2/07/01 4,946
1,500 Series 1997-6, Class A, 0.00%, 8/15/06 1,088
Discover Card Master Trust I,
2,200 Series 1993-3, Class A, 6.2%, 5/16/06 2,115
Household Affinity Credit Card Master Trust I,
962 Series 1993-2, Class A, 5.60%, 11/15/00 960
NationsBank Credit Card Master Trust:
3,995 Series 1995-1, Class A, 6.45%, 8/15/00 3,994
102 Series 1995-1, Class A, 6.45%, 4/15/03 102
Sears Credit Account Master Trust:
422 Series 1995-2, Class A, 8.10%, 1/15/01 424
1,917 Series 1996-1, Class A, 6.20%, 3/15/02 1,901
Spiegel Credit Card Master Trust:
333 Series 1994-B, Class A, 8.15%, 6/15/04 334
969 Series 1995-A, Class A, 7.50%, 9/15/04 971
--------------
22,403
--------------
HOME EQUITY LOAN RECEIVABLES 18.5%
Advanta Home Equity Loan Trust:
647 Series 1992-3, Class A1, 6.05%, 9/25/08 622
1,216 Series 1993-2, Class A2, 6.15%, 10/25/09 1,174
893 Series 1993-3, Class A1, 4.90%, 1/25/10 879
1,153 Series 1993-4, Class A1, 5.50%, 3/25/10 1,103
AFC Home Equity Loan Trust:
1,415 Series 1993-1, Class 1A, 5.90%, 5/20/08 1,384
1,140 Series 1993-4, Class 1A, 5.80%, 2/26/24 1,092
1,092 Series 1994-1, Class 1A, 6.40%, 5/25/25 1,066
Amresco Residential Securities Mortgage Loan,
1,179 Series 1998-2, Class A2, 6.245%, 4/25/22 1,170
BankAmerica Manufactured Housing Contract,
3,500 Series 1997-2, Class A6, 6.47%, 4/10/15 3,419
Contimortgage Home Equity Loan Trust,
1,000 Series 1997-4, Class A4, 6.30%, 7/15/02 992
Corestates Home Equity Trust,
1,582 Series 1996-1, Class A3, 7.00%, 12/15/09 1,580
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
HOME EQUITY LOAN RECEIVABLES 18.5% (CONT.)
EQCC Home Equity Loan Trust:
$1,558 Series 1993-3, Class A, 5.15%, 9/15/08 $ 1,493
1,100 Series 1993-4, Class A, 5.725%, 12/15/08 1,070
1,779 Series 1996-2, Class A2, 7.125%, 12/15/10 1,779
Equivantage Home Equity:
1,865 Series 1996-1, Class A, 6.55%, 10/25/25 1,821
4,048 Series 1996-4, Class A, 6.75%, 1/25/28 3,892
GE Home Equity Loan Asset-Backed Certificates:
1,782 Series 1991-1, Class B, 8.70%, 9/15/11 1,777
2,000 Series 1996-HE1, Class A4, 7.30%, 2/25/25 1,975
IMC Home Equity Loan Trust,
371 Series 1997-3, Class A4, 6.84%, 10/20/13 369
The Money Store Home Equity Trust:
697 Series 1993-B, Class A2, 6.975%, 7/15/08 686
417 Series 1995-C, Class A3, 6.55%, 9/15/21 415
1,478 Series 1993-B, Class A3, 6.10%, 5/15/22 1,448
UCFC Home Equity Loan:
476 Series 1993-B2, Class A2, 6.20%, 7/25/14 458
838 Series 1996-C1, Class A4, 7.475%, 3/15/20 836
528 Series 1995-A2, Class A7, 8.30%, 2/10/26 530
--------------
33,030
--------------
CORPORATE BONDS 29.9%
ABN AMRO Bank Guarantee,
1,750 6.625%, 10/31/01 1,728
AT&T Capital Corp. Company Guarantee:
2,000 6.875%, 1/16/01 1,996
3,295 6.25%, 5/15/01 3,260
America West Airlines Pass-Thru Certificates,
1,467 8.54%, 1/02/06 (Acquired 9/14/99, Cost $1,467)<F1> 1,442
Associated P&C Holdings Senior Notes,
2,000 6.75%, 7/15/03 (Acquired 9/03/99, Cost $1,925)<F1> 1,909
AVCO Financial Services Medium Term Notes,
1,100 5.75%, 1/23/06 1,086
Bankers Trust Subordinated Debentures,
1,310 8.125%, 5/15/02 1,318
Bankers Trust Subordinated Notes,
1,500 8.125%, 4/01/02 1,509
Bear Stearns Company Senior Notes,
800 9.375%, 6/01/01 814
Beneficial Corp. Notes,
800 8.20%, 3/15/02 809
Compass Bancshares, Inc.,
2,000 8.375%, 9/15/04 2,030
Dillard Investment Debentures,
2,000 9.25%, 2/01/01 2,026
Donaldson, Lufkin & Jenrette Senior Notes,
4,000 6.00%, 12/01/01 3,903
Dynegy, Inc. Senior Notes,
2,000 6.875%, 7/15/02 1,948
See notes to the financial statements.
108
<PAGE>
SHORT-TERM BOND MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 29.9% (cont.)
First Chicago Corporation Subordinated Notes,
$ 2,491 11.25%, 2/20/01 $ 2,566
First Interstate Bancorp Subordinated Notes,
2,000 10.875%, 4/15/01 2,063
Fleet Boston Corporation Subordinated Notes,
950 6.875%, 3/01/03 927
Goldman Sachs Group Notes,
2,000 6.25%, 2/01/03 (Acquired 6/30/99, Cost $1,961)<F1> 1,921
Household Finance Corporation Senior Notes,
1,000 6.125%, 7/15/12 969
Lehman Brothers Holdings, Inc. Notes,
2,000 8.75%, 5/15/02 2,030
Marlin Water Trust Senior Notes,
1,500 7.09%, 12/15/01 (Acquired 12/08/98; Cost $1,492)<F1>1,474
The Money Store Company Guarantee,
1,740 8.05%, 4/15/02 1,748
The Money Store Subordinated Notes,
1,350 7.30%, 12/01/02 1,333
Osprey Trust Secured Notes,
1,750 8.31%, 1/15/03 (Acquired 9/16/99, Cost $1,750) 1,742
Paine Webber Group Inc. Notes,
1,025 6.45%, 12/01/03 972
JC Penney Company, Inc. Notes,
2,000 7.25%, 4/01/02 1,857
Transamerica Financial Corp. Senior Notes,
1,900 6.125%, 11/01/01 1,858
USF&G Corporation Senior Notes,
1,455 8.375%, 6/15/01 1,468
Worldcom, Inc. Senior Notes,
4,472 8.875%, 1/15/06 4,635
--------------
53,341
--------------
MORTGAGE-BACKED SECURITIES 4.0%
Collateralized Mortgage Obligation Trust,
741 Series 15, Class E, 5.00%, 3/20/18 732
Green Tree Financial Corp. Pass-Thru Certificates:
720 Series 1994-A, Class A, 7.05%, 3/15/14 699
919 Series 1992-2, Class A4, 8.15%, 1/15/18 922
434 Series 1993-3, Class A5, 5.75%, 10/15/18 431
1,000 Series 1995-5, Class A5, 6.90%, 9/15/26 990
1,227 Series 1995-9, Class A4, 6.45%, 1/15/27 1,226
300 Series 1996-1, Class A3, 6.20%, 3/15/27 297
Prudential Securities Financial Asset Funding Corp.,
217 Series 1993-4, Class A3, 6.83%, 9/25/09 216
Prudential Securities Secured Financing Corp.:
572 Series 1998-C1, Class A1, 6.105%, 11/15/02 565
1,205 Series 1994-5, Class A1, 5.66%, 5/25/24 1,137
--------------
7,215
--------------
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 3.1%
Ford Capital BV Debentures,
$1,450 9.875%, 5/15/02 $ 1,504
Korea Development Bank Bonds:
2,000 6.25%, 5/01/00 2,000
2,000 7.125%, 9/17/01 1,977
--------------
5,481
--------------
OTHER 0.3%
Florida Housing Finance Agency:
130 Antigua Club-A-2, 8.625%, 8/01/01 130
215 Brittany Apartments-C-2, 8.625%, 8/01/02 216
220 Maitland Club-B-2, 8.625%, 8/01/01 221
--------------
567
--------------
U.S. GOVERNMENT AGENCY-BACKED
MORTGAGE ISSUES 2.5%
Federal Home Loan Mortgage Corporation (FHLMC)
Participation Certificates:
1 7.00%, 12/01/01 0
76 7.75%, 7/01/09 75
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC):
508 Series 1022, Class J, 6.00%, 12/15/20 477
3 Series 1169, Class D, 7.00%, 5/15/21 3
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
473 Series 1991-63, Class G, 6.95%, 5/25/06 470
3,600 Series 1996-W4, Class A4, 6.743%, 12/25/11 3,507
--------------
4,532
--------------
U.S. TREASURY OBLIGATIONS 23.3%
U.S. Treasury Bonds,
11,550 10.75%, 2/15/03 12,727
U.S. Treasury Notes:
10,150 6.625%, 3/31/02 10,131
18,800 6.375%, 8/15/02 18,688
--------------
41,546
--------------
Total Long-Term Investments (Cost $174,674) 171,578
--------------
See notes to the financial statements.
109
<PAGE>
SHORT-TERM BOND MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
NUMBER OF SHARES MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
SHORT-TERM INVESTMENTS 1.7%
INVESTMENT COMPANIES 1.7%
10 Financial Square Prime Obligation Fund $ 10
2,979 Short-Term Investments Co. Liquid Assets Portfolio 2,979
--------------
Total Short-Term Investments (Cost $2,989) 2,989
--------------
Total Investments (Cost $177,663) 97.8% 174,567
--------------
Other Assets, less Liabilities 2.2% 3,943
--------------
TOTAL NET ASSETS 100.0% $178,510
==============
<F1>Unregistered security
See notes to the financial statements.
110
<PAGE>
INTERMEDIATE BOND MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
LONG-TERM INVESTMENTS 91.2%
ASSET-BACKED SECURITIES 11.7%
AUTO LOAN RECEIVABLES 0.8%
Honda Auto Lease Trust,
$ 3,000 Series 1999-A, Class A5, 6.65%, 7/15/05 $ 2,969
--------------
CREDIT CARD RECEIVABLES 4.4%
American Express Master Trust,
2,000 Series 1994-2, Class A, 7.60%, 8/15/02 2,008
Chemical Master Credit Card Trust,
633 Series 1995-3, Class A, 6.23%, 8/15/02 619
Citibank Credit Card Master Trust, Principal Only:
11,900 Series 1996-1, Class A, 0.00%, 2/07/01 11,276
1,875 Series 1997-6, Class A, 0.00%, 8/15/06 1,360
Household Affinity Credit Card Master Trust I,
1,925 Series 1993-2, Class A, 5.60%, 11/15/00 1,920
Spiegel Credit Card Master Trust,
158 Series 1994-B, Class A, 8.15%, 6/15/04 158
--------------
17,341
HOME EQUITY LOAN RECEIVABLES 6.5%
Advanta Home Equity Loan Trust:
559 Series 1993-1, Class A1, 5.95%, 3/25/09 536
786 Series 1993-1, Class A2, 5.95%, 5/25/09 757
AFC Home Equity Loan Trust:
1,658 Series 1993-4, Class 1A, 5.80%, 2/26/24 1,588
2,246 Series 1996-4, Class 1A7, 6.86%, 3/25/27 2,171
Contimortgage Home Equity Loan Trust:
5,000 Series 1997-4, Class A4, 6.30%, 7/15/12 4,961
2,950 Series 1997-5, Class A5, 6.63%, 12/15/20 2,845
1,000 Series 1997-2, Class A9, 7.09%, 4/15/28 976
3,075 Series 1997-3, Class A9, 7.12%, 8/15/28 2,949
Corestates Home Equity Trust,
725 Series 1996-1, Class A3, 7.00%, 12/15/09 724
Delta Funding Home Equity Loan Trust,
2,000 Series 1997-4, Class A5F, 6.67%, 1/25/28 1,911
EQCC Home Equity Loan Trust:
277 Series 1994-4, Class A3, 8.68%, 10/15/08 278
726 Series 1993-4, Class A, 5.725%, 12/15/08 706
955 Series 1994-1, Class A, 5.80%, 3/15/09 927
2,000 Series 1996-1, Class A4, 6.56%, 3/15/23 1,919
2,000 Series 1997-1, Class A7, 7.12%, 5/15/28 1,974
UCFC Home Equity Loan,
889 Series 1995-C2, Class A6, 6.825%, 10/10/26 871
--------------
26,093
--------------
CORPORATE BONDS 36.6%
ABN AMRO Bank Guarantee,
1,600 7.25%, 5/31/05 1,569
Aetna Services, Inc. Company Guarantee,
3,000 6.75%, 8/15/01 2,964
Aetna Services, Inc. Debentures,
1,375 6.75%, 9/15/13 1,155
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 36.6% (CONT.)
Air 2 US,
$ 1,000 10.127%, 10/01/20 $ 1,015
American West Airlines, Pass-Thru Certificates,
2,087 8.54%, 1/02/06 (Acquired 9/14/99, Cost $2,087)<F1> 2,051
Amsouth Bancorp Subordinated Notes,
1,500 7.75%, 5/15/04 1,484
Associated P&C Holdings Senior Notes,
1,500 6.75%, 7/15/03 (Acquired 9/03/99, Cost $1,431)<F1> 1,432
AT&T Capital Corporation Company Guarantee:
2,000 6.25%, 5/15/01 1,979
1,075 6.75%, 2/04/02 1,061
BankAmerica Corporation Subordinated Notes,
2,000 10.00%, 2/01/03 2,112
BankBoston Notes,
1,450 6.375%, 4/15/08 1,330
Bankers Trust - NY Subordinated Debentures,
6,000 8.125%, 5/15/02 6,037
Bank of Oklahoma Subordinated Notes,
1,300 7.125%, 8/15/07 1,204
Bear Stearns Company Senior Notes:
2,000 9.375%, 6/01/01 2,035
150 6.25%, 7/15/05 139
Caterpillar, Inc. Sinking Fund Debentures,
2,112 9.75%, 6/01/19 2,206
Chase Manhattan Corp. Subordinated Notes,
2,300 9.375%, 7/01/01 2,351
Conectiv, Inc. Medium Term Notes,
3,000 6.73%, 6/01/06 2,899
Continental Airlines Inc. Pass-Thru Certificates,
1,470 6.80%, 7/02/07 1,388
Continental Bank N.A. Subordinated Notes,
2,875 12.50%, 4/01/01 3,005
Continental Cablevision, Inc. Debentures,
4,525 9.50%, 8/01/13 4,848
Dillard Investment Debentures,
1,895 9.25%, 2/01/01 1,919
Donaldson, Lufkin & Jenrette, Inc. Senior Notes,
3,000 5.875%, 4/01/02 2,902
Dynegy, Inc. Senior Notes,
2,100 6.875%, 7/15/02 2,045
Federal Express Corporation Notes,
1,500 9.65%, 6/15/12 1,618
Federal Express Sinking Fund Pass-Thru Certificates,
793 7.89%, 9/23/08 770
First Interstate Bancorp Subordinated Notes:
2,350 10.875%, 4/15/01 2,424
500 9.90%, 11/15/01 516
First National Bank Omaha Subordinated Notes,
1,600 7.32%, 12/01/10 1,476
First USA Bank Senior Notes,
1,000 5.85%, 2/22/01 989
See notes to the financial statements.
111
<PAGE>
INTERMEDIATE BOND MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 36.6% (CONT.)
Ford Motor Credit Co. Notes:
$2,575 8.20%, 2/15/02 $2,601
1,000 9.03%, 12/30/09 1,036
FPL Group Capital, Inc. Guaranteed Notes,
1,500 7.625%, 9/15/06 1,479
General Motors Acceptance Corp. Notes,
1,000 9.625%, 12/15/01 1,032
Georgia Pacific Corp. Debentures:
1,150 9.50%, 12/01/11 1,219
775 9.50%, 5/15/22 779
Goldman Sachs Group Notes,
5,000 6.25%, 2/01/03 (Acquired 2/01/96, Cost $4,988)<F1> 4,802
Homeside, Inc. Senior Notes,
1,000 11.25%, 5/15/03 1,089
Lehman Brothers Holdings, Inc. Notes:
1,500 6.65%, 11/08/00 1,496
1,212 8.875%, 3/01/02 1,232
800 8.75%, 5/15/02 812
2,700 7.50%, 9/01/06 2,618
Lehman Brothers, Inc. Debentures:
1,000 6.125%, 2/01/01 989
2,450 11.625%, 5/15/05 2,774
Marlin Water Trust Senior Notes,
2,492 7.09%, 12/15/01 (Acquired 12/08/98,
Cost $2,492)<F1> 2,448
The May Department Stores Debentures,
2,000 9.875%, 6/15/21 2,127
Merrill Lynch & Company Notes,
7,000 5.75%, 11/04/02 6,703
National Westminster Bank Debentures,
1,700 9.375%, 11/15/03 1,779
National Westminster Bank Subordinated Notes,
700 9.45%, 5/01/01 714
NCNB Corp. Subordinated Notes,
2,380 10.20%, 7/15/15 2,834
Newcourt Credit Group Notes:
1,785 7.125%, 12/17/03 (Acquired 9/14/99, Cost $1,772)<F1>1,745
1,800 6.875%, 2/16/05 (Acquired 3/16/99, Cost $1,032)<F1> 1,722
News America Holdings Debentures,
750 10.125%, 10/15/12 768
Northwest Airlines Pass-Thru Certificates:
831 8.13%, 2/01/14 774
834 7.248%, 7/02/14 752
Oneok, Inc. Notes,
1,100 7.75%, 8/15/06 1,081
Osprey Trust Secured Notes,
2,300 8.31%, 1/15/03 (Acquired 9/16/99, Cost $2,300)<F1> 2,290
Paine Webber Group, Inc. Notes:
3,000 7.115%, 1/27/04 2,908
500 8.875%, 3/15/05 511
Principal Financial Group Senior Notes,
4,500 8.20%, 8/15/09 (Acquired 8/18/99, Cost $4,486)<F1> 4,490
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 36.6% (CONT.)
PSI Energy, Inc. Debentures,
$1,600 7.85%, 10/15/07 $ 1,544
JC Penney Company, Inc. Debentures:
1,950 9.75%, 6/15/21 1,714
875 8.25%, 8/15/22 710
Rochester Telephone Corporation Debentures,
1,100 9.00%, 8/15/21 936
Salomon, Inc. Senior Notes,
1,100 6.75%, 2/15/03 1,074
Sears Roebuck Acceptance Corporation Notes,
1,300 6.25%, 5/01/09 1,143
Security Capital Group, Inc. Medium Term Notes,
1,700 7.75%, 11/15/03 1,630
Security Pacific Corp. Subordinated Notes,
1,158 11.00%, 3/01/01 1,193
Standard Federal Bancorp Medium Term Notes,
2,155 7.75%, 7/17/06 2,109
Toll Road Investors Debentures,
4,800 0.00%, 2/15/04 (Acquired 4/23/99, Cost $3,591)<F1> 3,570
Transamerica Finance Corporation Senior Notes,
3,225 6.125%, 11/01/01 3,154
United Airlines Pass-Thru Certificates,
3,055 7.27%, 1/30/13 2,858
United HealthCare Corporation Notes,
5,000 6.60%, 12/01/03 (Acquired 11/19/98, Cost $4,989)<F1>4,778
Westdeutsche Landesbank Subordinated Notes,
3,000 6.75%, 6/15/05 2,862
--------------
145,802
--------------
MORTGAGE-BACKED SECURITIES 4.7%
Advanta Mortgage Loan Trust,
1,054 Series 1997-1, Class A5, 7.35%, 5/25/27 1,034
AmResco Residential Securities Mortgage Loan,
3,000 6.96%, 3/25/27 2,912
Green Tree Financial Corporation Pass-Thru Certificates:
1,072 Series 1994-4, Class A4, 7.95%, 7/15/19 1,077
5,927 Series 1997-E, Class HEA6, 6.62%, 1/15/29 5,774
MDC Asset Investors Trust,
Real Estate Mortgage Investment Conduit (REMIC),
452 Series VIII, Class 8, 7.75%, 9/25/17 457
Merrill Lynch Mortgage Investors,
1,658 Series 1998-C1, Class A1, 6.31%, 11/15/26 1,589
Prudential Securities Financial Asset Funding Corp.,
1,292 Series 1993-8, Class A, 5.775%, 11/15/14 1,249
Prudential Securities Secured Financing Corp.:
949 Series 1993-1, Class A, 6.44%, 2/16/21 927
1,473 Series 1994-5, Class A1, 5.66%, 5/25/25 1,390
Residential Asset Securities Corporation,
1,000 Series 1998-KS1, Class AI9, 6.445%, 3/25/28 934
See notes to the financial statements.
112
<PAGE>
INTERMEDIATE BOND MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
MORTGAGE-BACKED SECURITIES 4.7% (CONT.)
Salomon Brothers Mortgage Securities VI,
$ 800 Series 1986-1, Class A, 6.00%, 12/25/11 $ 770
Westam Mortgage Financial Corporation,
557 Series 11, Class A, 6.36%, 8/26/20 533
--------------
18,646
--------------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 8.6%
AT&T Canada, Inc. Senior Notes:
2,000 9.95%, 6/15/08 1,574
2,000 10.625%, 11/01/08 2,218
Banco Santander-Chile Notes,
3,450 6.50%, 11/01/05 3,286
British Sky Broadcasting Subordinated Debentures,
1,130 6.875%, 2/23/09 988
Corp Andina De Fomento Notes,
750 7.75%, 3/01/04 737
Dresdner Bank Subordinated Debentures,
650 7.25%, 9/15/15 593
Ford Capital BV Debentures:
175 9.875%, 5/15/02 182
600 9.50%, 6/01/10 649
Hydro-Quebec Corporation Debentures,
2,250 11.75%, 2/01/12 2,931
Korea Development Bank Bonds:
1,300 6.25%, 5/01/00 1,300
1,075 7.125%, 9/17/01 1,063
Korea Electric Power Debentures:
3,000 8.00%, 7/01/02 2,959
820 7.75%, 4/01/13 746
750 6.75%, 8/01/27 698
Midland Bank PLC Subordinated Notes,
4,225 6.95%, 3/15/11 3,891
National Bank of Hungary Debentures,
1,350 8.875%, 11/01/13 1,393
Norsk Hydro A/S Debentures,
1,350 9.00%, 4/15/12 1,445
Pohang Iron & Steel Notes,
875 7.125%, 7/15/04 827
Sumitomo Bank International Notes,
1,600 9.55%, 7/15/00 1,598
Sanwa Bank Ltd. Subordinated Notes,
2,000 8.35%, 7/15/09 1,976
Union Camp Corp. Debentures,
659 10.00%, 5/01/19 682
Wharf Capital International Ltd. Notes:
800 8.875%, 11/01/04 804
1,725 7.625%, 3/13/07 1,602
--------------
34,142
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- ---------------
U.S. GOVERNMENT AGENCY-BACKED
MORTGAGE ISSUES 0.6%
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC):
$ 299 Series 1551, Class E, 6.50%, 9/15/07 $ 297
364 Series 1167, Class E, 7.50%, 11/15/21 359
1,099 Series 1286, Class A, 6.00%, 5/15/22 1,034
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
522 Series 1992-103, Class L, 7.50%, 11/25/02 523
223 Series 1990-89, Class K, 6.50%, 7/25/20 213
--------------
2,426
--------------
U.S. TREASURY OBLIGATIONS 29.0%
U.S. Treasury Bonds:
10,000 13.75%, 8/15/04 12,600
23,600 10.75%, 8/15/05 27,929
U.S. Treasury Strips, Principal Only:
60,900 0.00%, 11/15/04 45,216
42,000 0.00%, 8/15/05 29,696
--------------
115,441
--------------
Total Long-Term Investments (Cost $372,075) 362,860
--------------
NUMBER
OF SHARES
(IN THOUSANDS)
--------------
SHORT-TERM INVESTMENTS 5.3%
INVESTMENT COMPANIES 5.3%
6,205 Financial Square Prime Obligation Fund 6,205
15,057 Short-Term Investments Co. Liquid Assets Portfolio 15,057
--------------
Total Short-Term Investments (Cost $21,262) 21,262
--------------
Total Investments (Cost $393,337) 96.5% 384,122
--------------
Other Assets, less Liabilities 3.5% 13,926
--------------
TOTAL NET ASSETS 100.0% $ 398,048
==============
<F1>Unregistered security
113
<PAGE>
TAX-EXEMPT INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
GENERAL OBLIGATION 7.7%
Elgin, Illinois,
$ 2,990 7.25%, 1/01/04 $ 3,204
Lake County, Illinois, School District 112,
1,415 9.00%, 12/01/05 1,674
Washington State,
1,500 6.30%, 9/01/02 1,542
--------------
Total General Obligation (Cost $6,548) 6,420
--------------
REVENUE BONDS 1.7%
Utilities 1.7%
Scottsdale, Arizona Water and Sewer,
1,290 7.00%, 7/01/06 1,423
--------------
Total Revenue Bonds (Cost $1,484) 1,423
--------------
PREREFUNDED AND ESCROWED
TO MATURITY 67.0%
Alaska State Housing Finance Corporation,
1,465 6.375%, 12/01/12, Prerefunded 12/01/02 1,536
Anniston, Alabama Regional Medical Center Board Project,
1,400 8.00%, 7/01/11, Escrowed to Maturity 1,679
Arizona State Municipal Funding Program,
1,500 8.75%, 8/01/07, Escrowed to Maturity 1,826
Arizona Health Facilities Hospital Revenue,
1,870 7.25%, 11/01/14, Prerefunded 11/01/03 2,023
Cherokee County, Oklahoma,
1,340 0.00%, 11/01/11, Escrowed to Maturity 710
Cleveland, Ohio Parking Facilities Revenue,
1,125 8.10%, 9/15/22, Prerefunded 9/15/02 1,223
Delaware State Economic Development Authority,
First Mortgage; Gilpin Hall Project
2,800 7.625%, 7/01/25, Prerefunded 7/01/05 3,162
Delaware State Health Facilities Authority Revenue,
1,265 7.00%, 10/01/15, Prerefunded to Various Dates 1,357
Detroit, Michigan Water Supply System,
1,000 6.25%, 7/01/12, Prerefunded 7/01/02 1,041
Emporia, Kansas Sewer System,
1,165 6.25%, 11/15/07, Escrowed to Maturity 1,266
Farmington, New Mexico Power Revenue Bonds,
2,645 9.875%, 1/01/13, Prerefunded 7/01/05 3,157
Fruita, Colorado, Escrowed to Maturity,
490 9.25%, 4/01/03 537
Fulco, Georgia Hospital Authority Anticipation Certificates,
1,090 6.25%, 9/01/13, Prerefunded 9/01/02 1,140
Granite, Illinois Single Family Mortgage Revenue,
965 7.75%, 10/01/11, Escrowed to Maturity 1,098
Hazleton, Pennsylvania, Health Services Authority,
1,000 8.38%, 7/01/12, Prerefunded 1/01/03 1,098
Hodgkins, Illinois,
1,200 9.50%, 12/01/09, Prerefunded 12/01/01 1,318
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
PREREFUNDED AND ESCROWED
TO MATURITY 67.0% (cont.)
Houston, Texas Airport Systems Revenue,
$ 950 8.20%, 7/01/05, Escrowed to Maturity $ 1,042
Illinois Health Facilities Authority Revenue,
Memorial Hospital,
1,000 7.25%, 5/01/22, Prerefunded 5/01/02 1,063
Illinois Health Facilities Authority Revenue,
Evangelical - A
1,320 6.75%, 4/15/12, Escrowed to Maturity 1,443
Kentucky State Turnpike Authority Revenue,
1,400 7.20%, 7/01/09, Escrowed to Maturity 1,522
Louisiana Public Facilities Authority Hospital Revenue,
1,915 7.25%, 10/01/22, Prerefunded 10/01/02 2,048
Louisville, Kentucky Water & Sewer Revenue,
1,250 6.00%, 11/15/07, Escrowed to Maturity 1,318
Loveland, Colorado, Water Utility Improvements,
1,365 8.875%, 11/01/05, Escrowed to Maturity 1,561
Metropolitan Government Nashville & Davidson County,
Tennessee Water & Sewer,
5,000 0.00%, 12/01/13, Prerefunded 12/01/02 1,396
Minneapolis, Minnesota Hospital and Rehabilitation,
St. Mary's Hospital,
1,255 10.00%, 6/01/13, Escrowed to Maturity 1,634
New Jersey State Turnpike Authority Revenue,
820 6.75%, 1/01/09, Escrowed to Maturity 885
Peninsula Ports Authority Virginia Health Care Facilities -
Mary Immaculate Project,
2,000 7.00%, 8/01/17, Prerefunded to 8/01/04 & 8/01/06 2,091
Philadelphia Hospitals Authority Revenue,
1,150 9.875%, 7/01/10, Prerefunded 7/01/05 1,394
Phoenix, Arizona Street & Highway Users, Partially
Prerefunded 7/01/02, Remainder Escrowed to Maturity:
1,000 6.50%, 7/01/09 1,049
4,700 6.25%, 7/01/11 4,834
Regional Transportation Authority, Illinois Series B,
1,000 6.00%, 6/01/07, Prerefunded 6/01/04 1,053
San Marcos, California Certificates of Participation,
1,085 0.00%, 2/15/06, Escrowed to Maturity 808
St. Paul, Minnesota, Port Authority Hotel,
2,335 8.05%, 8/01/21, Prerefunded 8/01/08 2,757
Tulsa County, Oklahoma Home Finance Authority Single
Family Mortgage Revenue,
1,710 6.90%, 8/01/10, Escrowed to Maturity 1,908
University of Illinois,
1,005 6.10%, 10/01/03, Escrowed to Maturity 1,042
Wausau, Wisconsin School District,
1,000 6.50%, 4/01/10, Prerefunded 4/01/02 1,029
--------------
Total Prerefunded and Escrowed to Maturity
(Cost $57,552) 56,048
--------------
See notes to the financial statements.
114
<PAGE>
TAX-EXEMPT INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
INSURED BONDS 15.5%
EDUCATION 2.6%
Cook County, Illinois Niles Twp. School District,
$ 1,560 0.00%, 12/01/07 $ 1,038
Cook County, Illinois Cicero School District,
1,000 8.50%, 12/01/04 1,136
--------------
2,174
--------------
ELECTRIC 2.6%
Springfield, Illinois Electric Revenue:
1,000 6.00%, 3/01/04 1,033
1,050 6.00%, 3/01/06 1,097
--------------
2,130
--------------
GENERAL OBLIGATION 7.8%
Amarillo, Texas Independent School District,
1,035 7.00%, 2/01/06 1,131
Bolingbrook, Illinois, Principal Only,
1,080 0.00%, 1/01/05 845
Chicago, Illinois,
675 11.60%, 1/01/01 706
Maricopa County, Arizona Elementary School District,
No. 068, Alhambra,
2,500 5.625%, 7/01/13, Partially Prerefunded 2,547
Will County, Illinois Community School District #365,
1,685 0.00%, 11/01/05 1,253
--------------
6,482
--------------
PUBLIC FACILITIES & IMPROVEMENTS 2.5%
Illinois State Certificates of Participation,
1,000 6.00%, 7/01/06 1,045
Texas State Turnpike Authority, Dallas,
1,000 6.50%, 1/01/08 1,079
--------------
2,124
--------------
Total Insured Municipal Bonds (Cost $13,176) 12,910
--------------
NUMBER OF SHARES MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
INVESTMENT COMPANIES 6.4%
1,584 Financial Square Tax-Exempt $ 1,584
3,793 Tax Free Investment Trust 3,793
--------------
Total Investment Companies (Cost $5,377) 5,377
--------------
Total Investments (Cost $84,137) 98.3% 82,178
--------------
Other Assets, less Liabilities 1.7% 1,423
--------------
TOTAL NET ASSETS 100.0% $83,601
==============
See notes to the financial statements.
115
<PAGE>
BOND IMMDEX(TM) FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
LONG-TERM INVESTMENTS 96.0%
ASSET-BACKED SECURITIES 3.3%
CREDIT CARD RECEIVABLES 2.2%
Chemical Master Credit Card Trust,
$ 1,520 Series 1995-3, Class A, 6.23%, 4/15/05 $ 1,486
Citibank Credit Card Master Trust I, Principal Only:
3,465 Series 1996-1, Class A, 0.00%, 2/07/01 3,283
5,000 Series 1997-6, Class A, 0.00%, 8/15/06 3,628
Household Affinity Credit Card Master Trust I,
2,188 Series 1993-2, Class A, 5.60%, 11/15/00 2,181
Sears Credit Account Master Trust,
638 Series 1995-2, Class A, 8.10%, 1/15/01 641
--------------
11,219
--------------
HOME EQUITY LOAN RECEIVABLES 1.1%
Contimortgage Home Equity Loan Trust:
1,050 Series 1998-1, Class A6, 6.58%, 12/15/18 1,012
3,000 Series 1997-3, Class A8, 7.58%, 8/15/28 2,913
Delta Funding Home Equity Loan Trust,
2,000 Series 1997-3, Class A6F, 6.86%, 10/25/28 1,938
--------------
5,863
--------------
CORPORATE BONDS 45.0%
Aetna Services, Inc. Debentures,
1,800 6.75%, 9/15/13 1,512
Air 2 US Bonds:
1,000 10.127%, 10/01/20 (Acquired, Cost $1,034)<F1> 1,015
5,000 8.63%, 11/01/20 (Acquired 10/31/99, Cost $5,000)<F1>4,925
Alabama Power Company First Mortgage Bond,
1,000 9.00%, 12/01/24 1,027
American Airline Equipment Pass-Thru Certificates,
1,500 10.21%, 1/01/10 1,652
America West Airlines Pass-Thru Certificates:
2,755 8.54%, 1/02/06 (Acquired 9/14/99, Cost $2,775)<F1> 2,707
2,931 7.93%, 1/02/19 (Acquired 9/14/99, Cost $2,931)<F1> 2,917
Associated P&C Holdings Senior Notes,
4,895 6.75%, 7/15/03 (Acquired 11/5/98, Cost $4,793)<F1> 4,672
BankAmerica Corporation Subordinated Notes,
3,539 10.00%, 2/01/03 3,737
BankBoston Notes,
2,500 6.375%, 4/15/08 2,293
Barclays North American Capital Corp. Debentures,
925 9.75%, 5/15/21 983
Conectiv, Inc. Medium Term Notes,
3,000 6.73%, 6/01/06 2,899
Continental Airlines, Inc. Pass-Thru Certificates,
2,594 6.80%, 7/02/07 2,449
Continental Bank Subordinated Notes,
1,963 12.50%, 4/01/01 2,052
Continental Cablevision, Inc. Debentures,
8,200 9.50%, 8/01/13 8,785
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 45.0% (CONT.)
CSX Corporation Medium Term Notes,
$ 3,000 5.85%, 12/01/03 $ 2,790
Duty Free International, Inc. Notes,
6,450 7.00%, 1/15/04 6,316
Dynegy Inc. Senior Notes,
2,600 7.45%, 7/15/06 2,485
Federal Express Corporation Notes,
4,400 9.65%, 6/15/12 4,745
First National Bank Chicago Debentures,
1,350 8.08%, 1/05/18 1,375
First National Bank Omaha Subordinated Notes,
3,100 7.32%, 12/01/10 2,859
First Union Corporation Subordinated Notes,
3,000 8.125%, 6/24/02 3,024
First USA Bank Notes,
1,125 5.85%, 2/22/01 1,113
Ford Motor Company Debentures:
2,934 9.215%, 9/15/21 3,267
1,000 8.875%, 11/15/22 1,044
Geico Corporation Debentures,
2,000 9.15%, 9/15/21 2,103
General Motors Acceptance Corp. Notes,
2,694 9.625%, 12/15/01 2,780
Georgia Pacific Corp. Debentures:
1,511 9.50%, 12/01/11 1,602
4,605 9.875%, 11/01/21 4,699
975 9.50%, 5/15/22 980
Goldman Sachs Group Notes,
10,000 6.25%, 2/01/03 (Acquired 2/01/96; Cost $9,974)<F1> 9,604
GTE North, Inc. Debentures,
1,100 9.60%, 1/01/21 1,145
Harris Bankcorp Subordinated Notes,
1,065 9.375%, 6/01/01 1,085
Lehman Brothers Holdings, Inc. Notes:
3,825 6.65%, 11/08/00 3,815
5,000 7.50%, 9/01/06 4,848
Lehman Brothers Holdings, Inc. Senior Notes,
1,500 8.75%, 5/15/02 1,523
Lehman Brothers, Inc. Debentures:
2,365 9.875%, 10/15/00 2,397
2,620 11.625%, 5/15/05 2,966
Marlin Water Trust Senior Notes,
6,053 7.09%, 12/15/01 (Acquired 12/8/98, Cost $6,039)<F1> 5,947
The May Department Stores Company Debentures,
1,725 9.875%, 6/15/21 1,834
Merrill Lynch & Co. Medium Term Notes,
5,000 5.88%, 1/15/04 4,695
National Westminster Bancorp, Inc. Debentures,
1,000 9.375%, 11/15/03 1,047
See notes to the financial statements.
116
<PAGE>
BOND IMMDEX(TM) FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 45.0% (CONT.)
NCNB Corp. Subordinated Notes,
$ 5,155 10.20%, 7/15/15 $ 6,138
Newcourt Credit Group Notes,
6,490 6.875%, 2/16/05 (Acquired 3/16/99, Cost $6,587)<F1> 6,210
News America Holdings Debentures,
2,200 10.125%, 10/15/12 2,252
Northwest Airlines Corp. Pass-Thru Certificates,
7,025 7.248%, 7/02/14 6,336
Old Dominion Electric Co-op First Mortgage,
6,850 8.76%, 12/01/22 7,080
Osprey Trust Secured Notes,
3,750 8.31%, 1/15/03 (Acquired 9/16/99, Cost $3,750)<F1> 3,734
Paine Webber Group, Inc. Notes:
2,500 6.45%, 12/01/03 2,370
2,450 6.73%, 1/20/04 2,345
1,540 8.875%, 3/15/05 1,574
Parker Hannifin Debentures,
400 9.75%, 2/15/21 420
Principal Financial Group Senior Notes,
7,000 8.20%, 8/15/09 (Acquired 8/18/99, Cost $6,979)<F1> 6,984
PSIEnergy, Inc. Debentures,
3,100 7.85%, 10/15/07 2,992
JC Penney Company, Inc. Debentures:
4,000 9.75%, 6/15/21 3,516
1,000 8.25%, 8/15/22 811
Salomon, Inc. Notes,
3,450 7.00%, 6/15/03 3,383
Salomon, Inc. Senior Notes,
2,100 6.75%, 2/15/03 2,051
Security Capital Group, Inc. Medium Term Notes,
2,850 7.75%, 11/15/03 2,733
Sprint Capital Corporation Company Guarantee,
5,250 5.70%, 11/15/03 4,951
Sun Co., Inc. Debentures,
2,802 9.375%, 6/01/16 2,883
Tenneco, Inc. Debentures,
3,150 7.95%, 12/15/25 2,904
Time Warner, Inc. Debentures,
2,200 9.125%, 1/15/13 2,357
Toll Road Investors Debentures:
5,800 0.00%, 2/15/04 (Acquired 4/23/99, Cost $4,339)<F1> 4,314
1,000 0.00%, 2/15/05 (Acquired 5/21/99, Cost $705)<F1> 687
Transamerica Finance Corporation Senior Notes,
5,675 6.125%, 11/01/01 5,550
Union Camp Corp. Debentures,
111 10.00%, 5/01/19 115
United HealthCare Corporation Notes,
10,000 6.60%, 12/01/03 (Acquired 11/19/98, Cost $9,977)<F1>9,556
U.S. West Communications Debentures,
1,000 8.875%, 6/01/31 1,010
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
CORPORATE BONDS 45.0% (CONT.)
Utilicorp United Inc. Senior Notes,
$ 3,000 7.625%, 11/15/09 $ 2,850
Western National Corporation Senior Notes,
2,456 7.125%, 2/15/04 2,388
Williams Companies, Inc. Notes,
2,675 7.625%, 7/15/19 2,491
Wisconsin Public Service First Mortgage,
2,000 8.80%, 9/01/21 2,053
--------------
230,751
--------------
Mortgage-Backed Securities 1.2%
Amresco Residential Securities Mortgage Loan,
4,925 Series 1997-3, Class A9, 6.96%, 3/25/27 4,780
Merrill Lynch Mortgage Investors Inc.,
1,132 Series 1998, Class 1, 6.31%, 11/15/26 1,085
Prudential Securities Secured Financing Corp.,
281 Series 1993-1, Class A, 6.44%, 2/16/21 274
--------------
6,139
--------------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 14.4%
AT&T Canada, Inc. Senior Notes,
1,000 10.625%, 11/01/08 1,109
Banco Santander-Chile Notes,
4,925 6.50%, 11/01/05 4,691
British Sky Broadcasting Company Guarantee,
5,000 6.875%, 2/23/09 4,370
Dresdner Bank Subordinated Debentures,
3,500 7.25%, 9/15/15 3,196
Ford Capital BV Debentures,
560 9.875%, 5/15/02 581
Ford Capital BV Notes:
4,025 9.375%, 5/15/01 4,103
1,400 9.50%, 6/01/10 1,514
Household Netherlands BV Company Guarantee,
10,000 6.20%, 12/01/03 9,547
Hydro-Quebec Corporation Debentures:
3,500 11.75%, 2/01/12 4,559
750 9.75%, 1/15/18 783
Korea Development Bank Bonds:
2,300 7.125%, 9/17/01 2,273
3,600 7.90%, 2/01/02 3,583
Korea Electric Power Debentures:
2,020 7.75%, 4/01/13 1,838
1,400 6.75%, 8/01/27 1,303
Midland Bank PLC Subordinated Notes,
5,000 6.95%, 3/15/11 4,605
National Bank of Hungary Debentures,
2,490 8.875%, 11/01/13 2,570
Newfoundland (Province of) Canada,
1,975 10.00%, 12/01/20 2,387
See notes to the financial statements.
117
<PAGE>
BOND IMMDEX(TM) FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
INTERNATIONAL/YANKEE
(U.S. $ DENOMINATED) 14.4% (CONT.)
Norsk Hydro A/S Debentures,
$2,900 9.00%, 4/15/12 $ 3,104
Pohang Iron & Steel Notes,
1,575 7.125%, 7/15/04 1,488
Sanwa Bank Ltd. Subordinated Notes,
5,000 8.35%, 7/15/09 4,939
Stagecoach Holdings PLC Notes,
2,500 8.625%, 11/15/09 2,038
Sumitomo Bank International Guaranteed Notes,
3,000 8.50%, 6/15/09 2,991
Sweden (Kingdom of) Debentures,
1,100 11.125%, 6/01/15 1,424
Wharf Capital International Ltd. Notes:
2,700 8.875%, 11/01/04 2,715
2,675 7.625%, 3/13/07 2,484
--------------
74,195
--------------
U.S. GOVERNMENT AGENCY-BACKED
MORTGAGE ISSUES 5.1%
Federal Home Loan Bank (FHLB),
1,500 6.365%, 11/05/07 1,417
Federal Home Loan Mortgage Corporation (FHLMC),
59 Participation Certificates, 7.50%, 4/01/07 58
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC):
290 Series 6, Class C, 9.05%, 6/15/19 298
515 Series 1022, Class J, 6.00%, 12/15/20 483
12 Series 1169, Class D, 7.00%, 5/15/21 12
1,448 Series 162, Class F, 7.00%, 5/15/21 1,403
1,207 Series 1118, Class Z, 8.25%, 7/15/21 1,219
1,035 Series 188, Class H, 7.00%, 9/15/21 1,003
645 Series 1201, Class E, 7.40%, 12/15/21 642
1,177 Series 1790-A, Class A, 7.00%, 4/15/22 1,155
Federal National Mortgage Association (FNMA),
2,090 6.21%, 11/07/07 1,956
Federal National Mortgage Association (FNMA),
Participation Certificates:
238 Series 317, 7.50%, 8/01/07 236
75 Series 1464, 7.75%, 6/01/08 75
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
0 Series 1992-29, Class K, 77.917%, 11/25/00 0
13 Series 1992-145, Class N, 10.06%, 1/25/06 235
588 Series 1988-24, Class G, 7.00%, 10/25/18 570
583 Series 1989-44, Class H, 9.00%, 7/25/19 599
136 Series 1989-90, Class E, 8.70%, 12/25/19 139
606 Series 1990-30, Class E, 6.50%, 3/25/20 576
565 Series 1990-61, Class H, 7.00%, 6/25/20 549
PRINCIPAL AMOUNT MARKET VALUE
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
U.S. GOVERNMENT AGENCY-BACKED
MORTGAGE ISSUES 5.1% (CONT.)
Federal National Mortgage Association (FNMA) Real Estate Mortgage
Investment Conduit (REMIC) (cont.):
$ 335 Series 1990-72, Class B, 9.00%, 7/25/20 $ 344
445 Series 1990-102, Class J, 6.50%, 8/25/20 425
2,139 Series 1990-105, Class J, 6.50%, 9/25/20 2,038
371 Series 1990-106, Class J, 8.50%, 9/25/20 377
1,888 Series 1991-56, Class M, 6.75%, 6/25/21 1,823
2,840 Series 1991-134, Class Z, 7.00%, 10/25/21 2,745
804 Series 1992-120, Class C, 6.50%, 7/25/22 771
FDIC REMIC Trust,
5,341 Series 1996-C1, Class 1A, 6.75%, 5/25/26 5,214
--------------
26,362
--------------
U.S. TREASURY OBLIGATIONS 26.8%
U.S. Treasury Bonds:
16,050 9.875%, 11/15/15 21,587
71,180 9.25%, 2/15/16 91,666
U.S. Treasury Notes,
24,325 6.625%, 5/15/07 24,297
--------------
137,550
--------------
Total Long-Term Investments (Cost $494,935) 492,079
--------------
NUMBER
OF SHARES
(IN THOUSANDS)
--------------
SHORT-TERM INVESTMENTS 0.8%
INVESTMENT COMPANIES 0.8%
3,960 Short-Term Investments Co. Liquid Assets Portfolio 3,960
--------------
Total Short-Term Investments (Cost $3,960) 3,960
--------------
Total Investments (Cost $498,895) 96.8% 496,039
--------------
Other Assets, less Liabilities 3.2% 16,762
--------------
TOTAL NET ASSETS 100.0% $512,801
==============
<F1>Unregistered security
See notes to the financial statements.
118
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK.
<PAGE>
June 2000
DEAR SHAREHOLDER:
INVESTMENT REVIEW
Money market funds generated strong returns over the past six months as
commercial paper interest rates rose from approximately 5.80% in October of 1999
to 6.20% in April of 2000. Additionally, the Federal Reserve raised the Federal
Funds rate by .25% on February 2, 2000 and again on March 21, 2000. The Firstar
money market funds were managed with slightly shorter maturities versus their
respective benchmarks over the last six months.
Firstar money market funds are managed with quality and safety of principal as
our primary goals. All securities purchased by the Funds must meet our own
internal high standards for representing minimal credit risk as well as the
strict guidelines set by the Securities and Exchange Commission ("SEC"). Our
credit research team closely monitors all investments to ensure quality
standards are met.
MONEY MARKET FUNDS 7-DAY YIELD
PERIOD ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
INSTITUTIONAL TAX-EXEMPT U.S. GOVERNMENT U.S. TREASURY
MONEY MARKET MONEY MARKET MONEY MARKET MONEY MARKET MONEY MARKET
FUND<F1> FUND<F1> FUND<F1> FUND<F1> FUND<F1>
------------------------ ------------------------ ------------------------ ------------------------ ------------------------
CURRENT EFFECTIVE CURRENT EFFECTIVE CURRENT EFFECTIVE CURRENT EFFECTIVE CURRENT EFFECTIVE
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
5.41% 5.56% 5.76% 5.93% 3.78% 3.85% 5.33% 5.47% 5.05% 5.18%
<F1>After fee waivers. Had fees not been waived, current and effective yields would
have been 5.18% and 5.33% for the Money Market Fund, 5.52% and 5.69% for the
Institutional Money Market Fund and 5.13% and 5.27% for the U.S. Government
Money Market Fund. Reflects past performance; yields will vary. An investment in
any one of the Firstar Money Market Funds is neither insured nor guaranteed by
the U.S. Government. Although the money market funds seek to preserve the value
of your investment at $1.00 per share, it is possible to lose money by investing
in these funds.
Current yield refers to income earned by a fund's investments over a 7-day
period. It is then annualized and stated as a percentage of the investment.
Effective yield is the same as current yield except that it assumes the income
earned by an investment in a fund will be reinvested.
</TABLE>
120
<PAGE>
FIRSTAR MONEY MARKET FUNDS YIELD COMPARISONS<F1>
<TABLE>
<CAPTION>
FIRSTAR
FIRSTAR IBC'S TAX-EXEMPT
IBC'S FIRSTAR IBC'S TAX- MONEY MONEY
FIRSTAR MONEY FUND INSTITUTIONAL INSTITUTIONAL EXEMPT FUND MARKET TAX
MONEY AVERAGE (TM)/ MONEY AVERAGE (TM)/ MONEY AVERAGE (TM)/ EQUIVALENT
MARKET ALL TAXABLE MARKET ALL TAXABLE MARKET ALL TAX-FREE YIELD<F2>
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
2000
April ... 5.41% 5.46% 5.71% 5.62% 3.28% 3.37% 5.13%
March ... 5.25% 5.32% 5.63% 5.48% 3.09% 3.11% 4.83%
February 5.19% 5.22% 5.59% 5.37% 2.83% 2.93% 4.42%
January . 5.10% 5.11% 5.47% 5.24% 3.10% 2.86% 4.84%
1999
December 5.19% 5.06% 5.50% 5.20% 3.09% 3.23% 4.83%
November 4.92% 4.92% 5.31% 5.06% 2.82% 3.02% 4.41%
October . 4.79% 4.77% 5.12% 4.91% 2.67% 2.81% 4.17%
September 4.60% 4.69% 4.95% 4.85% 2.67% 2.80% 4.17%
August .. 4.42% 4.55% 4.79% 4.70% 2.47% 2.59% 3.86%
July .... 4.30% 4.45% 4.69% 4.61% 2.43% 2.50% 3.80%
June .... 4.22% 4.32% 4.58% 4.47% 2.57% 2.69% 4.02%
May ..... 4.18% 4.29% 4.54% 4.46% 2.70% 2.83% 4.22%
<CAPTION>
IBC'S
MONEY
FUND IBC'S
AVERAGE (TM/) FIRSTAR IBC'S FIRSTAR MONEY
ALL TAX-FREE U.S. MONEY U.S. FUND
TAX GOV'T FUND TREASURY AVERGAE (TM)/
EQUIVALENT MONEY AVERAGE (TM)/ MONEY U.S.
YIELD<F2> MARKET GOV'T MARKET TREASURY
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
2000
April ... 5.31% 5.25% 5.28% 5.01% 5.13%
March ... 4.86% 5.10% 5.14% 4.92% 5.00%
February 4.55% 4.89% 5.01% 4.70% 4.79%
January . 4.41% 4.69% 4.76% 4.58% 4.64%
1999
December 4.88% 4.75% 4.76% 4.38% 4.57%
November 4.70% 4.56% 4.67% 4.27% 4.39%
October . 4.38% 4.50% 4.52% 4.11% 4.25%
September 4.30% 4.50% 4.49% 4.15% 4.25%
August .. 4.05% 4.39% 4.35% 4.01% 4.12%
July .... 3.91% 4.28% 4.25% 3.96% 4.04%
June .... 4.20% 4.08% 4.13% 3.85% 3.98%
May ..... 4.42% 4.09% 4.12% 3.81% 3.93%
</TABLE>
<F1>After fee waivers. Had fees not been waived, performance would be reduced.
Reflects past performance; yield will vary. An investment in any one of the
Firstar Money Market Funds is neither insured nor guaranteed by the U.S.
Government nor is there any assurance the Funds will be able to maintain a
stable net asset value of $1.00 per share.
<F2>Assumes a 36% tax bracket.
LOOKING AHEAD - THE FORECAST
Looking ahead, we expect further increases in short-term interest rates as the
Federal Reserve continues to fight inflationary concerns in the economy. We
anticipate maintaining average maturities in the Firstar money market funds that
are consistent with their respective benchmarks. As always, our goal is to
maintain the high credit quality of the Funds while closely monitoring corporate
credit quality.
We continue to pride ourselves on meeting three important objectives for our
money market shareowners: PRESERVATION OF PRINCIPAL, LIQUIDITY AND COMPETITIVE
INVESTMENT INCOME. We believe these principles, combined with a disciplined
approach to quality, continue to be appropriate for our money market investors.
Your continued support in the Firstar money market funds is greatly appreciated.
Carl J. Smith
Margaret Radske
Anne Lamphere
Portfolio Managers
Firstar Investment Research & Management Company, LLC (FIRMCO)
121
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
U.S. U.S.
INSTITUTIONAL TAX-EXEMPT GOVERNMENT TREASURY
MONEY MONEY MONEY MONEY MONEY
MARKET FUND MARKET FUND MARKET FUND MARKET FUND MARKET FUND
--------------- --------------- --------------- --------------- ---------------
ASSETS:
<S> <C> <C> <C> <C> <C>
Investments, at amortized cost ......... $ 178,128 $ 2,194,610 $ 155,896 $ 61,934 $ 116,666
Receivable for securities matured ...... -- -- 2,000 -- --
Interest receivable .................... 188 1,428 1,601 18 605
Capital shares sold .................... 16,151 -- -- -- --
Other .................................. 22 27 10 7 12
--------------- --------------- --------------- --------------- ---------------
Total Assets ........................ 194,489 2,196,065 159,507 61,959 117,283
--------------- --------------- --------------- --------------- ---------------
LIABILITIES:
Capital shares redeemed ................ 11,556 -- -- 389 --
Dividends payable ...................... 695 9,482 401 256 466
Payable to affiliates .................. 182 1,152 154 101 117
Accrued expenses and other liabilities . 59 32 14 27 13
--------------- --------------- --------------- --------------- ---------------
Total Liabilities ................... 12,492 10,666 569 773 596
--------------- --------------- --------------- --------------- ---------------
NET ASSETS .................................. $ 181,997 $ 2,185,399 $ 158,938 $ 61,186 $ 116,687
=============== =============== =============== =============== ===============
CAPITAL STOCK, $.0001 par value
Authorized ............................. 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000
Issued and outstanding ................. 181,997 2,185,399 158,938 61,186 116,687
NET ASSET VALUE,
REDEMPTION PRICE AND
OFFERING PRICE PER SHARE ............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=============== =============== =============== =============== ===============
</TABLE>
See notes to the financial statements.
122
<PAGE>
STATEMENT OF OPERATIONS
(AMOUNTS IN THOUSANDS)
SIX MONTHS ENDED APRIL 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
U.S. U.S.
INSTITUTIONAL TAX-EXEMPT GOVERNMENT TREASURY
MONEY MONEY MONEY MONEY MONEY
MARKET FUND MARKET FUND MARKET FUND MARKET FUND MARKET FUND
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income .................... $ 6,274 $ 64,397 $ 2,947 $ 3,359 $ 2,920
--------------- --------------- --------------- --------------- ---------------
EXPENSES:
Investment advisory fees ........... 531 5,336 395 306 269
Administration fees ................ 113 1,160 84 65 58
Service organization fees .......... 50 -- -- -- --
Custody fees ....................... 18 156 14 19 9
Transfer agent fees and expenses ... 141 61 18 19 16
Fund accounting fees ............... 25 30 18 23 16
Professional fees .................. 22 20 21 20 18
Reports to shareholders ............ 91 7 5 11 5
Federal and state registration fees. 16 29 10 10 9
Directors' fees and expenses ....... 4 5 4 4 4
Other .............................. 4 18 2 4 1
--------------- --------------- --------------- --------------- ---------------
Total expenses before waiver ....... 1,015 6,822 571 481 405
Less: Waiver of expenses ........ (219) (2,587) -- (42) (3)
--------------- --------------- --------------- --------------- ---------------
Net Expenses .................... 796 4,235 571 439 402
--------------- --------------- --------------- --------------- ---------------
NET INVESTMENT INCOME ................... $ 5,478 $ 60,162 $ 2,376 $ 2,920 $ 2,518
=============== =============== =============== =============== ===============
</TABLE>
See notes to the financial statements.
123
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
INSTITUTIONAL TAX-EXEMPT
MONEY MARKET FUND MONEY MARKET FUND MONEY MARKET FUND
------------------------------ ------------------------------ ------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
APR. 30, 2000 OCT. 31, 1999 APR. 30, 2000 OCT. 31, 1999 APR. 30, 2000 OCT. 31, 1999
------------- ------------- ------------- ------------- ------------- -------------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income ....... $ 5,478 $ 12,640 $ 60,162 $ 104,359 $ 2,376 $ 3,476
------------- ------------- ------------- ------------- ------------- -------------
Net increase in net assets
resulting from
operations ............... 5,478 12,640 60,162 104,359 2,376 3,476
------------- ------------- ------------- ------------- ------------- -------------
CAPITAL SHARE
TRANSACTIONS:
Shares sold ................. 738,570 1,076,363 2,151,499 7,441,516 145,628 257,973
Shares issued to
owners in reinvestment
of dividends ............. 5,528 12,321 2,521 4,367 612 1,319
Shares redeemed ............. (845,582) (1,094,291) (2,324,872) (6,713,602) (140,491) (228,554)
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) ..... (101,484) (5,607) (170,852) 732,281 5,749 30,738
------------- ------------- ------------- ------------- ------------- -------------
DIVIDENDS PAID FROM:
Net investment income ....... (5,478) (12,640) (60,162) (104,359) (2,376) (3,476)
------------- ------------- ------------- ------------- ------------- -------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS ............... (101,484) (5,607) (170,852) 732,281 5,749 30,738
NET ASSETS:
Beginning of period ......... 283,481 289,088 2,356,251 1,623,970 153,189 122,451
------------- ------------- ------------- ------------- ------------- -------------
End of period ............... $ 181,997 $ 283,481 $ 2,185,399 $ 2,356,251 $ 158,938 $ 153,189
------------- ------------- ------------- ------------- ------------- -------------
</TABLE>
See notes to the financial statements.
124
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
U.S. GOVERNMENT U.S. TREASURY
MONEY MARKET FUND MONEY MARKET FUND
---------------------------------- ----------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APR. 30, 2000 OCT. 31, 1999 APR. 30, 2000 OCT. 31, 1999
--------------- --------------- --------------- ---------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income ............................... $ 2,920 $ 10,770 $ 2,518 $ 4,214
--------------- --------------- --------------- ---------------
Net increase in net assets
resulting from
operations ....................................... 2,920 10,770 2,518 4,214
--------------- --------------- --------------- ---------------
CAPITAL SHARE
TRANSACTIONS:
Shares sold ......................................... 197,467 891,590 148,379 345,253
Shares issued to
owners in reinvestment
of dividends ..................................... 693 1,870 231 422
Shares redeemed ..................................... (345,989) (917,621) (127,462) (342,008)
--------------- --------------- --------------- ---------------
Net increase (decrease) ............................. (147,829) (24,161) 21,148 3,667
--------------- --------------- --------------- ---------------
DIVIDENDS PAID FROM:
Net investment income ............................... (2,920) (10,770) (2,518) (4,214)
--------------- --------------- --------------- ---------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS ....................................... (147,829) (24,161) 21,148 3,667
NET ASSETS:
Beginning of period ................................. 209,015 233,176 95,539 91,872
--------------- --------------- --------------- ---------------
End of period ....................................... $ 61,186 $ 209,015 $ 116,687 $ 95,539
--------------- --------------- --------------- ---------------
</TABLE>
See notes to the financial statements.
125
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
NET ASSET NET DIVIDENDS FROM NET
VALUE, BEGINNING INVESTMENT NET INVESTMENT ASSET VALUE,
PER SHARE DATA OF PERIOD INCOME INCOME END OF PERIOD
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
MONEY MARKET FUND
Year Ended October 31, 1995 ...................... $ 1.00 $ 0.05 $ (0.05) $ 1.00
Year Ended October 31, 1996 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1997 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1998 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1999 ...................... 1.00 0.04 (0.04) 1.00
Six Months Ended April 30, 2000 (unaudited) ...... 1.00 0.03 (0.03) 1.00
INSTITUTIONAL MONEY MARKET FUND
Year Ended October 31, 1995 ...................... 1.00 0.06 (0.06) 1.00
Year Ended October 31, 1996 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1997 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1998 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1999 ...................... 1.00 0.05 (0.05) 1.00
Six Months Ended April 30, 2000 (unaudited) ...... 1.00 0.03 (0.03) 1.00
TAX-EXEMPT MONEY MARKET FUND
Year Ended October 31, 1995 ...................... 1.00 0.03<F6> (0.03) 1.00
Year Ended October 31, 1996 ...................... 1.00 0.03<F6> (0.03) 1.00
Year Ended October 31, 1997 ...................... 1.00 0.03<F6> (0.03) 1.00
Year Ended October 31, 1998 ...................... 1.00 0.03<F6> (0.03) 1.00
Year Ended October 31, 1999 ...................... 1.00 0.03<F6> (0.03) 1.00
Six Months Ended April 30, 2000 (unaudited) ...... 1.00 0.02<F6> (0.02) 1.00
U.S. GOVERNMENT MONEY MARKET FUND
Year Ended October 31, 1995 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1996 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1997 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1998 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1999 ...................... 1.00 0.04 (0.04) 1.00
Six Months Ended April 30, 2000 (unaudited) ...... 1.00 0.02 (0.02) 1.00
U.S. TREASURY MONEY MARKET FUND
Year Ended October 31, 1995 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1996 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1997 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1998 ...................... 1.00 0.05 (0.05) 1.00
Year Ended October 31, 1999 ...................... 1.00 0.04 (0.04) 1.00
Six Months Ended April 30, 2000 (unaudited) ...... 1.00 0.02 (0.02) 1.00
</TABLE>
<F1>Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31, 1999,
1998, 1997, 1996, 1995 would have been 0.96%, 0.85%, 0.86%, 0.84%, 0.81%,
0.90%, respectively; and ratios of net investment income to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997, 1996, 1995 would have been 4.94%, 4.31%,
4.79%, 4.73%, 4.73%, 5.06%, respectively.
<F2>Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31, 1999,
1998, 1997, 1996, 1995 would have been 0.63%, 0.62%, 0.64%, 0.66%, 0.64%,
0.69%, respectively; and ratios of net investment income to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997, 1996, 1995 would have been 5.30%, 4.52%,
5.01%, 4.92%, 4.90%, 5.29%, respectively.
<F3>Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31, 1999,
1998, 1997, 1996, 1995 would have been 0.72%, 0.73%, 0.75%, 0.75%, 0.78%,
0.84%, respectively; and ratios of net investment income to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997, 1996, 1995 would have been 3.01%, 2.49%,
2.87%, 2.91%, 2.91%, 3.12%, respectively.
See notes to the financial statements.
126
<PAGE>
<TABLE>
<CAPTION>
SUPPLEMENTAL DATA AND RATIOS
-------------------------------------------------------
RATIO OF NET RATIO OF NET
NET ASSETS, END EXPENSES TO AVERAGE INVESTMENT INCOME TO TOTAL
PER SHARE DATA OF PERIOD (000S) NET ASSETS AVERAGE NET ASSETS RETURN
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
MONEY MARKET FUND
Year Ended October 31, 1995 ..................... $ 172,261 0.60%<F1> 5.36%<F1> 5.51%
Year Ended October 31, 1996 ..................... 224,036 0.60%<F1> 4.94%<F1> 5.06%
Year Ended October 31, 1997 ..................... 261,017 0.60%<F1> 4.98%<F1> 5.12%
Year Ended October 31, 1998 ..................... 289,088 0.60%<F1> 5.05%<F1> 5.16%
Year Ended October 31, 1999 ..................... 283,481 0.72%<F1> 4.44%<F1> 4.52%
Six Months Ended April 30, 2000 (unaudited) ..... 181,997 0.75%<F1> 5.15%<F1> 2.61%<F7>
INSTITUTIONAL MONEY MARKET FUND
Year Ended October 31, 1995 ..................... 716,566 0.35%<F2> 5.63%<F2> 5.77%
Year Ended October 31, 1996 ..................... 750,051 0.35%<F2> 5.19%<F2> 5.32%
Year Ended October 31, 1997 ..................... 1,201,341 0.35%<F2> 5.23%<F2> 5.38%
Year Ended October 31, 1998 ..................... 1,623,970 0.35%<F2> 5.30%<F2> 5.41%
Year Ended October 31, 1999 ..................... 2,356,251 0.38%<F2> 4.76%<F2> 4.85%
Six Months Ended April 30, 2000 (unaudited) ..... 2,185,399 0.39%<F2> 5.54%<F2> 2.79%<F7>
TAX-EXEMPT MONEY MARKET FUND
Year Ended October 31, 1995 ..................... 84,084 0.60%<F3> 3.36%<F3> 3.42%
Year Ended October 31, 1996 ..................... 79,328 0.60%<F3> 3.09%<F3> 3.13%
Year Ended October 31, 1997 ..................... 108,639 0.60%<F3> 3.06%<F3> 3.12%
Year Ended October 31, 1998 ..................... 122,451 0.60%<F3> 3.02%<F3> 3.04%
Year Ended October 31, 1999 ..................... 153,189 0.71%<F3> 2.51%<F3> 2.53%
Six Months Ended April 30, 2000 (unaudited) ..... 158,938 0.72%<F3> 3.01%<F3> 1.50%<F7>
U.S. GOVERNMENT MONEY MARKET FUND
Year Ended October 31, 1995 ..................... 163,068 0.60%<F4> 5.24%<F4> 5.37%
Year Ended October 31, 1996 ..................... 198,334 0.60%<F4> 4.84%<F4> 4.96%
Year Ended October 31, 1997 ..................... 198,592 0.60%<F4> 4.83%<F4> 4.99%
Year Ended October 31, 1998 ..................... 233,176 0.60%<F4> 4.90%<F4> 4.97%
Year Ended October 31, 1999 ..................... 209,015 0.68%<F4> 4.30%<F4> 4.37%
Six Months Ended April 30, 2000 (unaudited) ..... 61,186 0.72%<F4> 4.77%<F4> 2.46%<F7>
U.S. TREASURY MONEY MARKET FUND
Year Ended October 31, 1995 ..................... 64,655 0.60%<F5> 5.04%<F5> 5.16%
Year Ended October 31, 1996 ..................... 53,430 0.60%<F5> 4.70%<F5> 4.80%
Year Ended October 31, 1997 ..................... 78,478 0.60%<F5> 4.67%<F5> 4.80%
Year Ended October 31, 1998 ..................... 91,872 0.60%<F5> 4.62%<F5> 4.71%
Year Ended October 31, 1999 ..................... 95,539 0.71%<F5> 3.94%<F5> 4.01%
Six Months Ended April 30, 2000 (unaudited) ..... 116,687 0.75%<F5> 4.67%<F5> 2.34%<F7>
</TABLE>
<F4>Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31, 1999,
1998, 1997, 1996, 1995 would have been 0.79%, 0.69%, 0.71%, 0.70%, 0.71%,
0.75%, respectively; and ratios of net investment income to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997, 1996, 1995 would have been 4.70%, 4.29%,
4.79%, 4.73%, 4.73%, 5.09%, respectively.
<F5>Without fees waived, ratios of net expenses to average net assets for the
period ended April 30, 2000 and for the fiscal years ended October 31, 1999,
1998, 1997, 1996, 1995 would have been 0.75%, 0.74%, 0.77%, 0.78%, 0.80%,
0.83%, respectively; and ratios of net investment income to average net
assets for the period ended April 30, 2000 and for the fiscal years ended
October 31, 1999, 1998, 1997, 1996, 1995 would have been 4.67%, 3.91%,
4.45%, 4.49%, 4.50%, 4.81%, respectively.
<F6>For the Tax-Exempt Money Market Fund, substantially all investment income is
exempt from federal income tax.
<F7>Not annualized.
See notes to the financial statements.
127
<PAGE>
MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
COMMERCIAL PAPER 85.0%
Asset Backed Security 13.1%
Ciesco L.P.,
$4,000 6.00%, 6/19/00 $ 3,967
Corporate Asset Funding Co., Inc.:
4,000 5.92%, 5/04/00 3,998
4,000 6.13%, 7/17/00 3,948
CXC, Inc.,
4,000 6.07%, 5/12/00 3,993
Edison Asset Securitization, L.L.C.:
4,000 5.84%, 5/03/00 3,999
4,000 6.11%, 6/28/00 3,961
--------------
23,866
--------------
Autos & Trucks 4.4%
Ford Motor Credit Company,
4,000 6.04%, 5/31/00 3,980
General Motors Acceptance Corporation,
4,000 6.16%, 7/10/00 3,952
--------------
7,932
--------------
Banking - Foreign 9.0%
Deutsche Bank Finance, Inc.:
4,000 6.08%, 6/07/00 3,975
4,000 6.08%, 6/30/00 3,960
Dresdner US Finance, Inc.,
4,000 6.11%, 6/27/00 3,961
UBS Finance (Delaware), Inc.,
4,500 5.84%, 5/10/00 4,493
--------------
16,389
--------------
Communications 4.4%
British Telecommunications PLC:
4,000 5.90%, 5/08/00 3,995
4,000 6.08%, 7/05/00 3,956
--------------
7,951
--------------
Finance - Miscellaneous 10.9%
Bell Atlantic Financial Services, Inc.,
4,000 6.04%, 5/01/00 4,000
CIT Group Holdings, Inc.,
4,000 5.94%, 6/01/00 3,980
National Rural Utilities CFC:
4,000 6.12%, 7/20/00 3,946
4,000 6.20%, 10/13/00 3,886
Sheffield Receivables Corp.,
4,000 6.06%, 5/26/00 3,983
--------------
19,795
--------------
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
Finance - Services 15.3%
Goldman Sachs Group, L.P.:
$4,000 6.06%, 5/11/00 $ 3,993
4,000 5.93%, 5/22/00 3,986
Household Finance Corporation:
4,000 6.06%, 6/14/00 3,970
4,000 6.07%, 6/22/00 3,965
Merrill Lynch and Co., Inc.:
4,000 5.88%, 5/01/00 4,000
4,000 6.14%, 7/28/00 3,940
Morgan Stanley, Dean Witter, Discover & Co.,
4,000 5.93%, 5/25/00 3,984
--------------
27,838
--------------
Insurance 8.7%
American Family Financial Services, Inc.:
4,000 5.85%, 5/18/00 3,989
4,000 6.06%, 9/18/00 3,906
Prudential Funding Corporation:
4,000 5.86%, 5/19/00 3,988
4,000 6.21%, 8/28/00 3,918
--------------
15,801
--------------
Machinery - Agriculture and Construction 3.3%
John Deere Capital Corporation,
6,000 6.25%, 6/12/00 6,003
--------------
Miscellaneous 6.5%
Bestfoods, Inc.,
4,000 5.95%, 6/06/00 3,976
Invensys PLC,
4,000 6.05%, 5/17/00 3,989
SBC Corporation,
4,000 6.14%, 8/09/00 3,931
--------------
11,896
--------------
Printing & Publishing 2.7%
McGraw Hill,
5,000 6.07%, 6/20/00 4,958
--------------
Sovereign 6.7%
Hydro-Quebec Corporation,
4,000 5.90%, 5/24/00 3,985
Quebec (Province of) Canada,
4,371 6.18%, 9/01/00 4,279
Venantius Corporation,
4,000 6.16%, 7/19/00 3,946
--------------
12,210
--------------
Total Commercial Paper 154,639
--------------
See notes to the financial statements.
128
<PAGE>
MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
FUNDING AGREEMENTS 3.8%
Travelers Insurance Corporation,
$7,000 6.31%, 6/30/00<F1> $ 7,000
--------------
Total Funding Agreements 7,000
--------------
VARIABLE RATE DEMAND NOTES 4.4%
8,000 Sara Lee Corporation 8,000
Total Variable Rate Demand Notes 8,000
--------------
NUMBER
OF SHARES
(IN THOUSANDS)
--------------
INVESTMENT COMPANIES 4.7%
2,786 Financial Square Prime Obligation Fund 2,786
5,703 Short-Term Investments Co. -
Liquid Assets Portfolio 5,703
--------------
Total Investment Companies 8,489
--------------
Total Investments 97.9% 178,128
--------------
Other Assets, less Liabilities 2.1% 3,869
--------------
NET ASSETS 100.0% $181,997
==============
<F1>Illiquid security
See notes to the financial statements.
129
<PAGE>
INSTITUTIONAL MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
COMMERCIAL PAPER 90.5%
Asset Backed 20.1%
Ciesco L.P.:
$50,000 6.00%, 6/19/00 $ 49,592
45,000 6.25%, 7/14/00 44,422
Corporate Asset Funding Co., Inc.:
50,000 5.92%, 5/04/00 49,975
46,000 6.13%, 7/17/00 45,397
CXC, Inc.:
5,000 6.09%, 6/23/00 4,955
50,000 6.07%, 8/28/00 48,997
50,000 6.18%, 9/14/00 48,833
Edison Asset Securitization, L.L.C.:
50,000 5.84%, 5/03/00 49,984
50,000 6.10%, 6/12/00 49,644
Riverwoods Funding,
48,000 5.90%, 5/19/00 47,858
--------------
439,657
--------------
Auto & Trucks 11.1%
Daimler Chrysler Holding Company:
50,000 5.90%, 5/23/00 49,820
50,000 5.94%, 6/02/00 49,736
Ford Credit Europe PLC,
45,000 6.06%, 6/22/00 44,606
General Motors Acceptance Corporation:
50,000 5.91%, 5/15/00 49,885
50,000 6.15%, 7/11/00 49,394
--------------
243,441
--------------
Banking - Foreign 10.5%
Deutsche Bank Financial, Inc.:
40,000 6.05%, 6/13/00 39,711
50,000 6.08%, 6/30/00 49,493
Dresdner US Finance, Inc.,
45,000 6.11%, 6/27/00 44,565
UBS Finance (Delaware), Inc.:
50,000 5.77%, 5/05/00 49,968
45,000 5.84%, 5/10/00 44,934
--------------
228,671
--------------
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
Communications & Media 4.6%
British Telecommunications PLC:
$50,000 5.90%, 5/08/00 $ 49,943
50,000 5.92%, 5/18/00 49,860
--------------
99,803
--------------
Finance - Miscellaneous 11.1%
Bell Atlantic Financial Services, Inc.,
50,000 6.27%, 6/28/00 49,495
CIT Group Holding, Inc.,
50,000 5.94%, 6/01/00 49,744
Household Finance Corporation,
50,000 6.06%, 6/14/00 49,630
National Rural Utilities CFC:
46,000 6.12%, 7/20/00 45,374
50,000 6.07%, 9/11/00 48,879
--------------
243,122
--------------
Finance - Services 13.2%
Goldman Sachs Group, L.P.:
50,000 6.06%, 5/11/00 49,916
50,000 6.12%, 6/28/00 49,507
Merrill Lynch & Company, Inc.:
40,000 5.88%, 5/01/00 40,000
50,000 6.07%, 6/21/00 49,570
Morgan Stanley, Dean Witter, Discovery & Co.:
50,000 5.93%, 5/25/00 49,802
50,000 5.95%, 6/09/00 49,678
--------------
288,473
--------------
Food and Beverage 2.3%
Diageo PLC,
50,000 5.83%, 5/17/00 49,870
--------------
Insurance 4.6%
American General Corporation:
50,000 5.93%, 5/31/00 49,753
50,000 5.95%, 6/07/00 49,694
--------------
99,447
See notes to the financial statements.
130
<PAGE>
INSTITUTIONAL MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
Miscellaneous 6.5%
BTR Siebe,
$50,000 6.05%, 6/15/00 $49,622
Invensys PLC,
50,000 5.92%, 5/09/00 49,934
SBC Corporation,
42,735 6.14%, 8/09/00 42,000
--------------
141,556
--------------
Printing and Publishing 2.0%
Reed Elsevier, Inc.,
45,000 6.08%, 6/20/00 44,620
--------------
Sovereign 4.5%
Hydro-Quebec Corporation,
50,000 5.90%, 5/24/00 49,812
Quebec (Province of) Canada,
50,000 6.25%, 9/25/00 48,724
--------------
98,536
--------------
Total Commercial Paper 1,977,196
--------------
FUNDING AGREEMENTS 3.8% Travelers Insurance Company:
40,000 6.16%, 2/19/01<F1> 40,000
43,000 6.31%, 6/30/00<F1> 43,000
--------------
Total Funding Agreements 83,000
--------------
NUMBER OF SHARES AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
INVESTMENT COMPANIES 6.1%
30,006 Financial Square Premium Money Market Fund $ 30,006
104,409 Short-Term Investments Co.
Liquid Assets Portfolio 104,409
--------------
Total Investment Companies 134,415
--------------
Total Investments 100.4% 2,194,610
--------------
Liabilities, less Other Assets (0.4)% (9,211)
--------------
NET ASSETS 100.0% $2,185,399
==============
<F1>Illiquid security
See notes to the financial statements.
131
<PAGE>
TAX-EXEMPTMONEY MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
GENERAL OBLIGATION 3.8%
Northwestern Mutual Life,
Tax-Exempt Mortgage Certificates
$ 100 4.50%, 2/15/09<F1><F2> $ 100
Laredo, Texas,
1,630 6.75%, 8/01/00 1,642
Richmond County, Georgia,
2,575 4.50%, 3/01/01 2,581
Wyandotte County, Kansas,
1,755 4.50%, 9/01/00 1,758
--------------
Total General Obligation 6,081
--------------
PREREFUNDED AND ESCROWED
TO MATURITY 25.9%
Austin, Texas Utility System Revenue,
4,000 10.75%, 5/15/10, Prerefunded 5/15/00 4,010
Boston, Massachusetts Hospital Revenue,
4,000 7.63%, 2/15/21, Prerefunded 8/15/00 4,108
Cattaraugus County, New York,
St. Bonaventure University,
3,000 8.30%, 12/01/10, Prerefunded 12/01/00 3,129
Central Arizona Water Conservation District,
5,175 7.13%, 11/01/11, Prerefunded 11/01/00 5,360
Henrico County, Virginia Hospital Revenue,
1,290 7.50%, 9/01/07, Prerefunded 8/01/00 1,327
Hoffman Estates, Illinois Economic Development,
3,910 7.63%, 11/15/09, Prerefunded 11/15/00 4,056
Illinois State,
2,000 6.50%, 6/01/01, Prerefunded 6/01/00 2,044
Martinsville Memorial Hospital, Virginia,
1,250 7.00%, 1/01/06, Prerefunded 1/01/01 1,271
Massachusetts State University Hospital,
4,000 7.25%, 7/01/19, Prerefunded 7/01/00 4,101
Metropolitan Transit Authority, New York,
2,530 7.50%, 7/01/26, Prerefunded 7/01/00 2,595
Montgomery County, Pennsylvania,
1,580 8.63%, 7/01/07, Prerefunded 7/01/00 1,621
Northeast Independent School District, Texas,
1,900 6.00%, 6/15/00, Escrowed to Maturity 1,906
Rhode Island Hospital Revenue,
1,000 7.75%, 7/01/16, Prerefunded 7/01/00 1,026
Scranton-Lackwana, Pennsylvania Hospital Revenue,
1,520 7.25%, 6/15/05, Prerefunded 6/15/00 1,557
Tucson, Arizona Street and Highway User Revenue,
1,000 6.88%, 7/01/08, Prerefunded 7/01/00 1,015
Walled Lake, Michigan School District,
2,000 7.10%, 5/01/05, Prerefunded 5/01/00 2,040
--------------
Total Prerefunded and Escrowed to Maturity 41,166
--------------
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
REVENUE BONDS 61.4%
Electric Revenue 7.8%
Chelan County, Washington Public Utility,
$ 5,000 5.09%, 6/01/15<F1><F2> $ 5,000
County of Mason, Kentucky, Series 1984B,
1,950 4.99%, 10/15/14<F1><F2> 1,950
Putnam County, Florida Development Authority -
5,485 Seminole Electric, 4.99%, 3/15/14<F1><F2> 5,485
--------------
12,435
--------------
Hospital Revenue 14.2%
Illinois Health Facilities Authority,
Southern Illinois Healthcare Enterprises,
2,500 5.09%, 3/01/21<F1><F2> 2,500
Illinois Health Facilities Authority,
4,100 Recreational Facilities, 5.04%, 12/01/25<F1><F2> 4,100
Indiana Health Facilities Finance Authority -
4,600 Henry County Memorial Hospital, 5.04%, 4/01/13<F1> 4,600
Indiana Hospital Equipment Finance Authority, <F2>
2,250 Nursing Home Improvements, 5.04%, 12/01/15<F1><F2> 2,250
Wisconsin State Health & Educational Facilities -
1,900 Blood Center, 5.14%, 6/01/19<F1><F2> 1,900
Wisconsin State Health & Educational Facilities -
5,000 Marshfield Clinic, 5.09%, 6/01/10<F1><F2> 5,000
Wisconsin State Health & Educational Facilities -
2,109 Sinai Samaritan, 5.14%, 9/01/19<F1><F2> 2,109
--------------
22,459
--------------
Housing Revenue 7.9%
Florida Housing Finance Agency -
3,000 Carlton Multi-Family, 5.14%, 12/01/08<F1><F2> 3,000
Illinois Development Finance Authority -
3,215 St. Paul's House, 5.09%, 2/01/2<F1><F2> 3,215
Orland Hills, Illinois, Multi-Family,
2,470 5.09%, 12/01/04<F1><F2> 2,470
Washington State Housing Finance - Community
3,830 Multi-Family Mortgage, 5.09%, 10/01/20<F1><F2> 3,830
--------------
12,515
--------------
See notes to the financial statements.
132
<PAGE>
TAX-EXEMPTMONEY MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
Industrial Development/Pollution
Control Revenue 6.0%
Mason County, Kentucky Pollution Control,
$ 2,850 4.99%, 10/15/14<F1><F2> $ 2,850
Oakbrook Terrace, Illinois Industrial Development,
4,100 3.89%, 12/01/25<F1><F2> 4,100
Oklahoma County, Oklahoma Finance Authority -
2,600 Perrine Office Project, 4.29%, 12/01/14<F1><F2> 2,600
--------------
9,550
--------------
Miscellaneous 11.1%
Cook County, Illinois:
3,790 5.09%, 5/01/20<F1><F2> 3,790
2,000 5.09%, 1/01/28<F1><F2> 2,000
Illinois Development Finance Authority,
4,800 Rest Haven, 5.09%, 1/01/27<F1><F2> 4,800
Illinois Development Finance Authority,
3,000 Presbyterian Home Lake-A, 5.09%, 9/01/31<F1><F2> 3,000
Illinois Education Facilities Authority,
2,000 Chicago Zoological Society, 5.09%, 12/15/25<F1><F2> 2,000
Indiana Health Facilities Finance Authority,
2,100 5.04%, 1/12/20<F1><F2> 2,100
--------------
17,690
--------------
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
University Revenue 14.4%
Illinois Development Finance Authority -
$ 6,000 St. Ignatius College Prep, 5.09%, 6/01/24<F1><F2> 6,000
Minnesota State Higher Educational Authority,
4,745 Bethel College, 5.09%, 4/01/28<F1><F2> 4,745
Texas Higher Education Authority,
2,190 5.09%, 12/01/25<F1><F2> 2,190
University of Illinois, Series 1990A,
720 Certificates of Participation, 7.25%, 8/15/00 727
University of Minnesota, Series A,
4,000 5.09%, 1/01/34<F1><F2> 4,000
University of North Carolina, Chapel Hill Foundation
5,200 Certificates of Participation, 5.09%, 10/01/09<F1> 5,200
<F2> --------------
22,862
--------------
Total Revenue Bonds 97,511
--------------
NUMBER
OF SHARES
(IN THOUSANDS)
--------------
INVESTMENT COMPANIES 7.0%
7,321 Financial Square Tax-Exempt Money Market Fund 7,321
3,817 Tax Free Cash Reserves 3,817
--------------
Total Investment Companies 11,138
--------------
Total Investments 98.1% 155,896
--------------
Other Assets, less Liabilities 1.9% 3,042
--------------
NET ASSETS 100.0% $158,938
==============
<F1>Variable rate security
<F2>Stated maturity with option to put
133
<PAGE>
U.S. GOVERNMENTMONEY MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- ---------------
U.S. GOVERNMENT AGENCIES 96.2%
Federal Farm Credit Bank 30.4%
Federal Farm Credit Bank Discount Notes:
$ 4,000 5.95%, 6/02/00 $ 3,979
4,000 5.92%, 6/16/00 3,970
4,000 5.96%, 6/30/00 3,960
6,790 6.01%, 7/21/00 6,698
--------------
18,607
--------------
Federal Home Loan Mortgage Corporation 22.8%
Federal Home Loan Mortgage Corporation Discount Notes:
2,000 5.82%, 5/02/00 2,000
6,000 5.77%, 5/11/00 5,990
3,000 5.82%, 5/18/00 2,992
3,000 5.82%, 5/25/00 2,988
--------------
13,970
--------------
Federal National Mortgage Assn. 20.1%
Federal National Mortgage Assn. Discount Notes:
2,500 5.83%, 5/04/00 2,499
2,000 5.87%, 6/08/00 1,988
5,417 5.97%, 6/22/00 5,370
2,500 6.10%, 7/20/00 2,466
--------------
12,323
--------------
Other 22.8%
Tennessee Valley Authority Discount Notes:
2,000 5.94%, 5/03/00 1,999
4,000 5.89%, 5/11/00 3,994
2,000 5.85%, 5/16/00 1,995
2,000 5.86%, 5/31/00 1,990
4,000 5.99%, 6/28/00 3,962
--------------
13,940
--------------
Total U.S. Government Agencies 58,840
--------------
NUMBER OF SHARES AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
INVESTMENT COMPANIES 5.0%
58 Financial Square Government Obligation Fund $ 58
3,036 Short-Term Investments Co. Treasury Portfolio 3,036
--------------
Total Investment Companies 3,094
--------------
Total Investments 101.2% 61,934
--------------
Liabilities, less Other Assets (1.2)% (748)
--------------
NET ASSETS 100.0% $ 61,186
==============
See notes to the financial statements.
134
<PAGE>
U.S. TREASURY MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT AMORTIZED COST
(IN THOUSANDS) (IN THOUSANDS)
---------------- --------------
U.S. TREASURIES 93.8%
U.S. Treasury Notes 32.5%
$ 5,000 6.25%, 5/31/00 $ 5,002
5,000 6.13%, 7/31/00 5,004
10,000 6.00%, 8/15/00 9,999
5,000 6.25%, 8/31/00 5,001
5,000 4.50%, 9/30/00 4,967
8,000 4.00%, 10/31/00 7,915
--------------
37,888
--------------
U.S. Treasury Bills 61.3%
5,000 5.76%, 5/04/00 4,998
7,000 5.75%, 5/11/00 6,989
10,000 5.52%, 5/25/00 9,963
8,000 5.67%, 6/08/00 7,952
15,000 5.63%, 6/15/00 14,894
16,000 5.41%, 6/22/00 15,875
4,000 5.66%, 7/06/00 3,958
5,000 5.63%, 7/20/00 4,937
2,000 5.73%, 8/10/00 1,968
--------------
71,534
--------------
Total U.S. Treasuries 109,422
--------------
NUMBER
OF SHARES
(IN THOUSANDS)
--------------
INVESTMENT COMPANIES 6.2%
5,687 Financial Square
Treasury Obligation Portfolio 5,687
1,557 Short-Term Investments Co.
Treasury Tax Advantage Portfolio 1,557
--------------
Total Investment Companies 7,244
--------------
Total Investments 100.0% 116,666
--------------
Other Assets, less Liabilities 0.0% 21
--------------
NET ASSETS 100.0% $116,687
==============
See notes to the financial statements.
135
<PAGE>
BALANCED INCOME FUND SHORT-TERM BOND MARKET FUND
BALANCED GROWTH FUND INTERMEDIATE BOND MARKET FUND
GROWTH AND INCOME FUND TAX-EXEMPT INTERMEDIATE BOND FUND
EQUITY INDEX FUND BOND IMMDEX(TM) FUND
GROWTH FUND MONEY MARKET FUND
MIDCAP INDEX FUND INSTITUTIONAL MONEY MARKET FUND
SPECIAL GROWTH FUND TAX-EXEMPT MONEY MARKET FUND
EMERGING GROWTH FUND U.S. GOVERNMENT MONEY MARKET FUND
MICROCAP FUND U.S. TREASURY MONEY MARKET FUND
CORE INTERNATIONAL EQUITY FUND
INTERNATIONAL EQUITY FUND
Notes to the Financial Statements
1. ORGANIZATION
Firstar Funds, Inc. (the "Company") was incorporated on
February 15, 1988, as a Wisconsin Corporation and is registered as
an open-end management investment company under the Investment Company Act of
1940, as amended. The Balanced Income, Balanced Growth, Growth and Income,
Equity Index, Growth, MidCap Index, Special Growth, Emerging Growth, MicroCap,
Core International Equity, International Equity, Short-Term Bond Market,
Intermediate Bond Market, Tax-Exempt Intermediate Bond, Bond IMMDEX(TM), Money
Market, Institutional Money Market, Tax-Exempt Money Market, U.S. Government
Money Market and U.S. Treasury Money Market Funds (the "Funds"), are separate,
diversified investment portfolios of the Company. The Money Market Fund
commenced operations on March 16, 1988; the Tax-Exempt Money Market Fund
commenced operations on June 27, 1988; the U.S. Government Money Market Fund
commenced operations on August 1, 1988; the Special Growth Fund commenced
operations on December 28, 1989; the Short-Term Bond Market Fund, Bond
IMMDEX(TM) Fund, Growth and Income Fund and Equity Index Fund commenced
operations on December 29, 1989; the Institutional Money Market Fund commenced
operations on April 26, 1991; the U.S. Treasury Money Market Fund commenced
operations on April 29, 1991; the Balanced Growth Fund commenced operations on
March 30, 1992; the Growth Fund commenced operations on December 29, 1992; the
Intermediate Bond Market Fund commenced operations on January 5, 1993; the
Tax-Exempt Intermediate Bond Fund commenced operations on February 8, 1993; the
International Equity Fund commenced operations on April 28, 1994; the MicroCap
Fund commenced operations on August 1, 1995; the Emerging Growth Fund commenced
operations on August 15, 1997; the Balanced Income Fund commenced operations on
December 1, 1997; and the MidCap Index Fund and Core International Equity Fund
commenced operations on November 4, 1999. The objective of the Short-Term Bond
Market Fund is to seek to provide an annual rate of total return, before Fund
expenses, comparable to the annual rate of total return of the Lehman Brothers
1-3 year Government/Corporate Bond Index. The objective of the Intermediate Bond
Market Fund is to seek to provide an annual rate of total return, before Fund
expenses, comparable to the annual rate of total return of the Lehman Brothers
Intermediate Government/Corporate Bond Index. The objective of the Tax-Exempt
Intermediate Bond Fund is to seek to provide current income that is
substantially exempt from federal income tax and emphasize total return with
relatively low volatility of principal. The objective of the Bond IMMDEX(TM)
Fund is to seek to provide an annual rate of total return, before Fund expenses,
comparable to the annual rate of total return of the Lehman Brothers
Government/Corporate Bond Index. The objective of the Balanced Income Fund is to
seek current income and the preservation of capital through investment in a
balanced portfolio of dividend-paying equity and fixed income securities. The
objective of the Balanced Growth Fund is to achieve a balance of capital
appreciation and current income with relatively low volatility of capital. The
objective of the Growth and Income Fund is to seek both reasonable income and
long-term capital appreciation. The objective of the Equity Index Fund is to
seek returns, before Fund expenses, comparable to the price and yield
performance of publicly traded common stocks in the aggregate, as represented by
the S&P 500 Stock Index. The objective of the Growth Fund is capital
appreciation through investment in securities of large-sized companies. The
objective of the MidCap Index Fund is to seek returns, before Fund expenses,
comparable to the price and yield performance of publicly traded common stocks
in the aggregate, as represented by the S&P MidCap 400 Index. The objective of
the Special Growth Fund is capital appreciation. The objective of the Emerging
Growth Fund is capital appreciation. The objective of the MicroCap Fund is
capital appreciation. The objective of the Core International Equity Fund is to
provide maximum, long-term total return consistent with reasonable risk to
principal. The objective of the International Equity Fund is to seek capital
appreciation through investment in foreign securities which the Sub-Advisor
believes are undervalued.
The costs, in thousands, incurred in connection with the organization,
initial registration and public offering of shares aggregating $47, $21, $24 and
$27 for the Balanced Income, Emerging Growth, MicroCap and International Equity
Funds, respectively, have been paid by the respective Funds. These costs are
being amortized over the period of benefit, but not to exceed sixty months from
each Fund's commencement of operations.
136
<PAGE>
The Company has issued three classes of Fund shares in each of the non-money
market funds: Series A, Series B and Series Institutional. The Series A shares
are subject to a 0.25% service organization fee and an initial sales charge
imposed at the time of purchase, in accordance with the Funds' prospectus. The
maximum sales charge on Series A shares purchased in the Short-Term Bond Market,
Intermediate Bond Market, Tax-Exempt Intermediate Bond, and Bond IMMDEX(TM)
Funds, is 4.00% of the offering price or 4.17% of the net asset value. The
maximum sales charge on Series A shares purchased in the Balanced Income,
Balanced Growth, Growth and Income, Equity Index, Growth, MidCap Index, Special
Growth, Emerging Growth, MicroCap, Core International Equity and International
Equity Funds is 5.50% of the offering price or 5.82% of the net asset value. The
Series B shares are subject to a 0.25% service organization fee and a 0.75%
distribution and service (12b-1) fee. The B shares are also subject to a
contingent deferred sales charge at the time of redemption, in accordance with
the Funds' prospectus. The maximum sales charge is 5% for redemptions in the
first year, 4% in the second year, 3% in the third and fourth years, 2% in the
fifth year, 1% in the sixth year and 0% thereafter. Each class of shares for
each non-Money Market Fund has identical rights and privileges except with
respect to service organization fees paid by Series A and Series B shares,
voting rights on matters affecting a single class of shares and the exchange
privileges of each class of shares.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with generally accepted accounting principles.
a) Investment Valuation - Securities which are traded on a recognized stock
exchange are valued at the last sale price on the securities exchange on which
such securities are primarily traded or at the last sale price on a national
securities exchange. Exchange-traded securities for which there were no
transactions are valued at the current bid prices, with the exception of the
International Equity Fund, which is valued at the average of the current bid and
asked prices. Securities traded on only over-the-counter markets are valued on
the basis of closing over-the-counter bid prices. Investments in the money
market funds and instruments with a maturity of 60 days or less are valued on
the basis of amortized cost for financial reporting purposes and federal income
tax purposes, which approximates market value. Variable rate demand notes and
funding agreements are valued at cost which approximates market value.
Investment company securities are valued at net asset value which approximates
market value. Securities for which market quotations are not readily available
and other assets are valued at fair market value as determined by the investment
adviser under the supervision of the Board of Directors. At April 30, 1999, the
MicroCap Fund held three such securities which represents 0.03% of investments
at value. Portfolio securities which are primarily traded on foreign securities
exchanges are generally valued at the preceding closing values of such
securities on their respective exchanges, except when an occurrence subsequent
to the time a value was so established is likely to have changed such value. In
such an event, the fair value of those securities is determined through the
consideration of other factors by or under the direction of the Board of
Directors. Quotations of foreign securities in foreign currency are converted to
United States ("U.S.") dollar equivalents using the foreign exchange quotation
in effect at the time net asset value is computed. Foreign securities held by
the International Equity Fund may trade in their local markets on days the U.S.
exchanges are closed, and the International Equity Fund's net asset value may,
therefore, change on days when investors may not purchase or redeem Fund shares.
b) Federal Income Taxes - It is each Fund's policy to meet the requirements of
the Internal Revenue Code applicable to regulated investment companies and each
Fund intends to distribute substantially all investment company net taxable
income and net capital gains to shareholders. Therefore, no federal income tax
provision is required.
c) Income and Expenses - The Funds are charged for those expenses that are
directly attributable to each portfolio, such as advisory, administration and
certain shareholder service fees. Expenses that are not directly attributable to
a portfolio are typically allocated among the Company's portfolios in proportion
to their respective net assets, number of shareholder accounts, or net sales,
where applicable. For Funds with more than one class of shares, net investment
income other than class specific expenses, and realized and unrealized gains and
losses are allocated daily to each class of shares based upon the relative net
asset value of outstanding shares of each class of shares at the beginning of
the day (after adjusting for the current day's capital share activity of the
respective class).
d) Distributions to Shareholders - Dividends from net investment income of the
Money Market, Tax-Exempt Money Market, U.S. Government Money Market, U.S.
Treasury Money Market and the Institutional Money Market Funds are declared
daily and paid monthly. Dividends from net investment income of the Short-Term
Bond Market, Intermediate Bond Market, Tax-Exempt Intermediate Bond and Bond
IMMDEX(TM) Funds are declared and paid monthly. Dividends from net investment
income, if any, are declared and paid quarterly for the Balanced Income,
Balanced Growth, Growth and Income, Equity Index and MidCap Index Funds and
annually for the Growth, Special Growth, Emerging Growth, MicroCap, Core
International Equity and International Equity Funds. Distributions of net
realized capital gains, if any, will be declared at least annually. Certain
Funds may also utilize earnings and profits distributed to shareholders on
redemption of shares as part of the dividends paid deduction. Accordingly,
reclassifications are made within the net asset accounts for such amounts, as
well as amounts related to permanent differences in the character of certain
income and expense items for income tax and financial reporting purposes.
e) Futures Contracts - The Equity Index and MidCap Index Funds
may utilize futures contracts to a limited extent. The risk associated with the
use of futures contracts includes the possibility of an illiquid
137
<PAGE>
market. Futures contracts are valued based upon their quoted daily settlement
prices. Changes in initial settlement value are accounted for as unrealized
appreciation (depreciation) until the contracts are terminated at which time
realized gains and losses are recognized.
f) When-Issued Securities - The Tax-Exempt Money Market, Balanced Income,
Balanced Growth, Growth and Income, Equity Index, Growth, MidCap Index, Special
Growth, Emerging Growth, MicroCap, Core International Equity, International
Equity, Short-Term Bond Market, Intermediate Bond Market, Tax-Exempt
Intermediate Bond and Bond IMMDEX(TM) Funds may purchase securities on a
when-issued or delayed delivery basis. Although the payment and interest terms
of these securities are established at the time the purchaser enters into the
agreement, these securities may be delivered and paid for at a future date,
generally within 45 days. Each of these Funds records purchases of when-issued
securities and reflects the values of such securities in determining net asset
value in the same manner as other portfolio securities. Each of these Funds
identifies and maintains at all times cash, cash equivalents or other liquid
securities in an amount at least equal to the amount of outstanding commitments
of when-issued securities.
g) Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
h) Foreign Currency Translations - The books and records of the International
Equity Fund are maintained in U.S. dollars. Foreign currencies, investments and
other assets and liabilities denominated in foreign currencies are translated
into U.S. dollars at the exchange rates prevailing at the end of the period, and
purchases and sales of investment securities, and income and expenses
denominated in foreign currencies are translated on the respective dates of such
transactions. Unrealized gains and losses on investments which result from
changes in foreign currency exchange rates have been included in the unrealized
net appreciation (depreciation) on investments. Foreign currency exchange gains
and losses included in net appreciation (depreciation) on foreign currency and
net realized gains and losses on foreign currency include foreign currency gains
and losses between trade date and settlement date on investment securities
transactions, and foreign currency transactions; such amounts are considered net
investment income (loss) for tax purposes. The portion of the foreign currency
gains and losses related to fluctuation in exchange rates between the initial
purchase date and subsequent sale date of a security is included in realized
gains and losses on investment transactions.
i) Other - Investment and shareholder transactions are recorded on the trade
date. Dividend income is recognized on the ex-dividend date or as soon as
information is available to the Funds. Interest income is recognized on an
accrual basis. Discounts and premiums on securities are amortized over the life
of the respective security. Discounts and premiums on securities with put
provisions are amortized to the earlier of the put date or maturity. Realized
gains and losses from investment transactions are determined by comparing the
net sale proceeds to an identified cost basis. Transactions in captial shares at
$1.00 per share for the money market funds are shown in the Statement of Changes
in Net Assets.
138
<PAGE>
3. CAPITAL SHARE TRANSACTIONS
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
BALANCED INCOME BALANCED GROWTH GROWTH AND INCOME
FUND FUND FUND
---------------------- ---------------------- ----------------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Six months ended April 30, 2000:
Series A shares:
Shares sold ....................................... $ 700 64 $ 1,584 50 $ 5,167 115
Shares issued to owners in
reinvestment of dividends ...................... 351 33 3,246 106 16,017 374
Shares redeemed ................................... (2,733) (252) (9,597) (305) (29,475) (669)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ........................... $ (1,682) (155) $ (4,767) (149) $ (8,291) (180)
========= ========= ========= ========= ========= =========
Series B shares:
Shares sold ....................................... $ 2,028 187 $ 550 17 $ 1,157 26
Shares issued to owners in
reinvestment of dividends ...................... 69 6 46 2 172 4
Shares redeemed ................................... (111) (10) (37) (1) (376) (9)
--------- --------- --------- --------- --------- ---------
Net increase ...................................... $ 1,986 183 $ 559 18 $ 953 21
========= ========= ========= ========= ========= =========
Series Institutional shares:
Shares sold ....................................... $ 54,530 5,051 $ 32,477 1,036 $ 69,089 1,561
Shares issued to owners in
reinvestment of dividends ...................... 1,132 104 10,892 353 38,794 904
Shares redeemed ................................... (29,321) (2,682) (64,574) (2,045) (116,454) (2,646)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ........................... $ 26,341 2,473 $ (21,205) (656) $ (8,571) (181)
========= ========= ========= ========= ========= =========
Year ended October 31, 1999:
Series A shares:
Shares sold ....................................... $ 5,020 454 $ 6,468 210 $ 26,309 570
Shares issued to owners in
reinvestment of dividends ...................... 731 66 2,840 92 15,257 332
Shares redeemed ................................... (3,181) (289) (15,607) (513) (44,599) (973)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ........................... $ 2,570 231 $ (6,299) (211) $ (3,033) (71)
========= ========= ========= ========= ========= =========
Series B shares:
Shares sold ....................................... $ 1,591 145 $ 649 21 $ 1,606 35
Shares issued to owners in
reinvestment of dividends ...................... 9 1 2 0 1 0
Shares redeemed ................................... (28) (3) (14) 0 (36) (1)
--------- --------- --------- --------- --------- ---------
Net increase ...................................... $ 1,572 143 $ 637 21 $ 1,571 34
========= ========= ========= ========= ========= =========
Series Institutional shares:
Shares sold ....................................... $ 25,571 2,342 $ 57,953 1,893 $ 151,499 3,290
Shares issued to owners in
reinvestment of dividends ...................... 607 55 9,563 310 34,560 750
Shares redeemed ................................... (10,418) (949) (75,558) (2,501) (146,699) (3,196)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ........................... $ 15,760 1,448 $ (8,042) (298) $ 39,360 844
========= ========= ========= ========= ========= =========
</TABLE>
139
<PAGE>
3. CAPITAL SHARE TRANSACTIONS (cont.)
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
EQUITY INDEX GROWTH MIDCAP INDEX SPECIAL GROWTH
FUND FUND FUND<F1> FUND
---------------------- ---------------------- ---------------------- ----------------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
--------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Six months ended April 30, 2000:
Series A shares:
Shares sold ................. $ 10,649 113 $ 4,466 108 $ 1,396 133 $ 2,442 59
Shares issued to owners in
reinvestment of dividends 3,735 39 2,404 60 3 -- 1,829 44
Shares redeemed ............. (15,531) (165) (8,546) (208) (148) (14) (24,201) (560)
--------- --------- --------- --------- --------- --------- --------- ---------
Net increase (decrease) ..... $ (1,147) (13) $ (1,676) (40) $ 1,251 119 $ (19,930) (457)
--------- --------- --------- --------- --------- --------- --------- ---------
Series B shares:
Shares sold ................. $ 4,743 50 $ 419 10 $ 276 25 $ 74 2
Shares issued to owners in
reinvestment of dividends 132 1 40 1 -- -- 3 --
Shares redeemed ............. (592) (6) (146) (4) -- -- (2) --
--------- --------- --------- --------- --------- --------- --------- ---------
Net increase ................ $ 4,283 45 $ 313 7 $ 276 25 $ 75 2
--------- --------- --------- --------- --------- --------- --------- ---------
Series Institutional shares:
Shares sold ................. $ 232,747 2,464 $ 171,661 4,149 $ 94,513 9,136 $ 53,505 1,179
Shares issued to owners in
reinvestment of dividends 15,245 158 12,621 310 315 28 6,230 146
Shares redeemed ............. (173,166) (1,838) (210,266) (5,053) (3,647) (335) (117,564) (2,670)
--------- --------- --------- --------- --------- --------- --------- ---------
Net increase (decrease) ..... $ 74,826 784 $ (25,984) (594) $ 91,181 8,829 $ (57,829) (1,345)
--------- --------- --------- --------- --------- --------- --------- ---------
Year ended October 31, 1999:
Series A shares:
Shares sold ................. $ 32,030 378 $ 13,457 359 $ 10,459 266
Shares issued to owners in
reinvestment of dividends 1,948 23 4,322 117 1,072 26
Shares redeemed ............. (27,974) (329) (11,168) (301) (53,329) (1,380)
--------- --------- --------- --------- --------- --------- --------- ---------
Net increase (decrease) ..... $ 6,004 72 $ 6,611 175 $ (41,798) (1,088)
--------- --------- --------- --------- --------- --------- --------- ---------
Series B shares:
Shares sold ................. $ 4,598 51 $ 745 20 $ 176 4
Shares issued to owners in
reinvestment of dividends 8 0 0 0 0 0
Shares redeemed ............. (96) (1) (24) (1) (51) (1)
--------- --------- --------- --------- --------- --------- --------- ---------
Net increase ................ $ 4,510 50 $ 721 19 $ 125 3
--------- --------- --------- --------- --------- --------- --------- ---------
Series Institutional shares:
Shares sold ................. $ 304,539 3,463 $ 204,039 5,432 $ 245,028 6,379
Shares issued to owners in
reinvestment of dividends 7,889 92 18,176 486 3,350 80
Shares redeemed ............. (294,685) (3,440) (127,316) (3,421) (358,282) (9,295)
--------- --------- --------- --------- --------- --------- --------- ---------
Net increase (decrease) ..... $ 17,743 115 $ 94,899 2,497 $(109,904) (2,836)
--------- --------- --------- --------- --------- --------- --------- ---------
</TABLE>
<F1>Capital share activity is for the period November 4, 1999 to April 30, 2000
for the MidCap Index Fund.
140
<PAGE>
3. CAPITAL SHARE TRANSACTIONS (cont.)
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
EMERGING GROWTH MICROCAP CORE INTERNATIONAL
FUND FUND EQUITY FUND<F1>
---------------------- ---------------------- ----------------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
--------- --------- --------- --------- --------- ---------
Six months ended April 30, 2000:
Series A shares:
<S> <C> <C> <C> <C> <C> <C>
Shares sold .................................. $ 1,524 45 $ 14,677 527 $ 33 3
Shares issued to owners in
reinvestment of dividends ................. -- -- 5,924 296 -- --
Shares redeemed .............................. (3,682) (130) (15,464) (508) (2) --
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ...................... $ (2,158) (85) $ 5,137 315 $ 31 3
--------- --------- --------- --------- --------- ---------
Series B shares:
Shares sold .................................. 123 10 $ 500 20 $ 45 5
Shares issued to owners in
reinvestment of dividends ................. -- -- 61 3 -- --
Shares redeemed .............................. (17) (2) (33) (1) -- --
--------- --------- --------- --------- --------- ---------
Net increase ................................. $ 106 8 $ 528 22 $ 45 5
--------- --------- --------- --------- --------- ---------
Series Institutional shares:
Shares sold .................................. $ 22,965 2,091 $ 62,985 2,271 $ 39,805 3,991
Shares issued to owners in
reinvestment of dividends ................. -- -- 40,308 1,987 41 4
Shares redeemed .............................. (28,318) (2,597) (55,139) (1,912) (127) (13)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ...................... $ (5,353) (506) $ 48,154 2,346 $ 39,719 3,982
--------- --------- --------- --------- --------- ---------
Year ended October 31, 1999:
Series A shares:
Shares sold .................................. $ 3,655 379 $ 8,724 596
Shares issued to owners in
reinvestment of dividends ................. 15 1 42 3
Shares redeemed .............................. (6,228) (657) (9,284) (594)
--------- --------- --------- ---------
Net increase (decrease) ...................... $ (2,558) (277) $ (518) 5
--------- --------- --------- ---------
Series B shares:
Shares sold .................................. $ 91 10 $ 119 6
Shares issued to owners in
reinvestment of dividends ................. 0 0 0 0
Shares redeemed .............................. (10) (1) 0 0
--------- --------- --------- ---------
Net increase ................................. $ 81 9 $ 119 6
--------- --------- --------- ---------
Series Institutional shares:
Shares sold .................................. $ 137,021 14,295 $ 44,207 2,966
Shares issued to owners in
reinvestment of dividends ................. 56 5 222 16
Shares redeemed .............................. (54,262) (5,665) (31,952) (1,964)
--------- --------- --------- ---------
Net increase (decrease) ...................... $ 82,815 8,635 $ 12,477 1,018
--------- --------- --------- ---------
</TABLE>
INTERNATIONAL
EQUITY FUND
----------------------
AMOUNT SHARES
--------- ---------
Six months ended April 30, 2000:
Series A shares:
Shares sold .................................. $ 819 43
Shares issued to owners in
reinvestment of dividends ................. 4 --
Shares redeemed .............................. (1,189) (63)
--------- ---------
Net increase (decrease) ...................... $ (366) (20)
--------- ---------
Series B shares:
Shares sold .................................. $ 272 15
Shares issued to owners in
reinvestment of dividends ................. -- --
Shares redeemed .............................. (4) --
--------- ---------
Net increase ................................. $ 268 15
--------- ---------
Series Institutional shares:
Shares sold .................................. $ 20,003 1,053
Shares issued to owners in
reinvestment of dividends ................. 142 7
Shares redeemed .............................. (19,234) (1,011)
--------- ---------
Net increase (decrease) ...................... $ 911 49
--------- ---------
Year ended October 31, 1999:
Series A shares:
Shares sold .................................. $ 1,394 81
Shares issued to owners in
reinvestment of dividends ................. 122 8
Shares redeemed .............................. (2,781) (171)
--------- ---------
Net increase (decrease) ...................... $ (1,265) (82)
--------- ---------
Series B shares:
Shares sold .................................. $ 43 2
Shares issued to owners in
reinvestment of dividends ................. 0 0
Shares redeemed .............................. 0 0
--------- ---------
Net increase ................................. $ 43 2
--------- ---------
Series Institutional shares:
Shares sold .................................. $ 18,830 1,077
Shares issued to owners in
reinvestment of dividends ................. 569 37
Shares redeemed .............................. (18,366) (1,125)
--------- ---------
Net increase (decrease) ...................... $ 1,033 (11)
--------- ---------
<F1>Capital share activity is for the period November 4, 1999 to April 30, 2000
for the Core International Equity Fund.
141
<PAGE>
3. CAPITAL SHARE TRANSACTIONS (cont.)
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE TAX-EXEMPT
BOND MARKET BOND MARKET INTERMEDIATE
FUND FUND BOND FUND
---------------------- ---------------------- ----------------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Six months ended April 30, 2000:
Series A shares:
Shares sold .................................. $ 1,830 181 $ 1,817 181 $ 497 49
Shares issued to owners in
reinvestment of dividends ................. 1,564 155 648 65 349 35
Shares redeemed .............................. (13,605) (1,349) (6,007) (600) (5,855) (581)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ...................... $ (10,211) (1,013) $ (3,542) (354) $ (5,009) (497)
--------- --------- --------- --------- --------- ---------
Series B shares:
Shares sold .................................. $ 210 21 $ 73 7 $ -- --
Shares issued to owners in
reinvestment of dividends ................. 13 1 6 1 2 --
Shares redeemed .............................. (91) (9) (14) (1) -- --
--------- --------- --------- --------- --------- ---------
Net increase ................................. $ 132 13 $ 65 7 $ 2 --
--------- --------- --------- --------- --------- ---------
Series Institutional shares:
Shares sold .................................. $ 14,539 1,443 $ 135,126 13,504 $ 22,325 2,215
Shares issued to owners in
reinvestment of dividends ................. 2,381 236 5,269 528 465 46
Shares redeemed .............................. (23,233) (2,306) (50,652) (5,064) (18,252) (1,809)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ...................... $ (6,313) (627) $ 89,743 8,968 $ 4,538 452
--------- --------- --------- --------- --------- ---------
Year ended October 31, 1999:
Series A shares:
Shares sold .................................. $ 16,593 1,613 $ 11,144 1,076 $ 10,448 996
Shares issued to owners in
reinvestment of dividends ................. 3,684 361 1,312 128 1,102 106
Shares redeemed .............................. (28,615) (2,795) (6,903) (671) (22,903) (2,210)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ...................... $ (8,338) (821) $ 5,553 533 $ (11,353) (1,108)
--------- --------- --------- --------- --------- ---------
Series B shares:
Shares sold .................................. $ 523 51 $ 298 29 $ 74 7
Shares issued to owners in
reinvestment of dividends ................. 11 1 5 0 1 0
Shares redeemed .............................. (11) (1) (92) (9) 0 0
--------- --------- --------- --------- --------- ---------
Net increase ................................. $ 523 51 $ 211 20 $ 75 7
--------- --------- --------- --------- --------- ---------
Series Institutional shares:
Shares sold .................................. $ 36,523 3,563 $ 59,956 5,810 $ 20,125 1,936
Shares issued to owners in
reinvestment of dividends ................. 5,004 512 9,542 986 754 73
Shares redeemed .............................. (28,833) (2,841) (65,622) (6,392) (19,735) (1,896)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) ...................... $ 12,694 1,234 $ 3,876 404 $ 1,144 113
--------- --------- --------- --------- --------- ---------
</TABLE>
BOND
IMMDEX(TM)
FUND
----------------------
AMOUNT SHARES
--------- ---------
Six months ended April 30, 2000:
Series A shares:
Shares sold .................................. $ 4,849 175
Shares issued to owners in
reinvestment of dividends ................. 2,391 88
Shares redeemed .............................. (17,844) (654)
--------- ---------
Net increase (decrease) ...................... $ (10,604) (391)
--------- ---------
Series B shares:
Shares sold .................................. $ 608 22
Shares issued to owners in
reinvestment of dividends ................. 46 2
Shares redeemed .............................. (315) (12)
--------- ---------
Net increase ................................. $ 339 12
--------- ---------
Series Institutional shares:
Shares sold .................................. $ 81,756 3,006
Shares issued to owners in
reinvestment of dividends ................. 10,150 375
Shares redeemed .............................. (81,347) (2,993)
--------- ---------
Net increase (decrease) ...................... $ 10,559 388
--------- ---------
Year ended October 31, 1999:
Series A shares:
Shares sold .................................. $ 27,886 980
Shares issued to owners in
reinvestment of dividends ................. 5,101 182
Shares redeemed .............................. (26,725) (951)
--------- ---------
Net increase (decrease) ...................... $ 6,262 211
--------- ---------
Series B shares:
Shares sold .................................. $ 2,003 72
Shares issued to owners in
reinvestment of dividends ................. 38 1
Shares redeemed .............................. (128) (5)
--------- ---------
Net increase ................................. $ 1,913 68
--------- ---------
Series Institutional shares:
Shares sold .................................. $ 161,261 5,691
Shares issued to owners in
reinvestment of dividends ................. 19,616 698
Shares redeemed .............................. (205,542) (7,220)
--------- ---------
Net increase (decrease) ...................... $ (24,665) (831)
--------- ---------
142
<PAGE>
4. INVESTMENT TRANSACTIONS
The aggregate purchases and sales, in thousands, of securities, excluding
short-term investments, for the Funds for the period ended April 30, 2000, were
as follows:
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH AND EQUITY GROWTH
INCOME FUND GROWTH FUND INCOMEFUND INDEXFUND FUND
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Purchases:
U.S. Government ........................ $ 25,032 $ 12,214 -- -- --
Other .................................. 46,709 102,120 $ 374,489 $ 55,696 $ 118,758
Sales:
U.S. Government ........................ $ 11,999 $ 21,187 -- -- --
Other .................................. 31,482 134,066 $ 413,354 $ 6,127 $ 143,970
<CAPTION>
MIDCAP SPECIAL EMERGING CORE
INDEX GROWTH GROWTH MICROCAP INTERNATIONAL
FUND FUND FUND FUND EQUITY FUND
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Purchases:
U.S. Government ........................ -- -- -- -- --
Other .................................. $ 100,026 $ 471,201 $ 98,244 $ 341,358 $ 18,785
Sales:
U.S. Government ........................ -- -- -- -- --
Other .................................. $ 15,730 $ 555,773 $ 105,494 $ 341,093 $ 5,727
<CAPTION>
SHORT-TERM INTERMEDIATE TAX-EXEMPT BOND
INTERNATIONAL BOND MARKET BOND MARKET INTERMEDIATE IMMDEX(TM)
EQUITY FUND FUND FUND BOND FUND FUND
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Purchases:
U.S. Government ........................ -- $ 8,459 $ 76,788 -- $ 34,484
Other .................................. $ 19,748 17,888 25,822 $ 5,103 27,779
Sales:
U.S. Government ........................ -- $ 7,819 $ 17,210 -- $ 33,541
Other .................................. $ 20,720 34,094 24,538 $ 9,822 33,521
</TABLE>
Equity Index Fund transactions in futures contracts during the period October
31, 1999 to April 30, 2000, in thousands, were as follows:
AGGREGATE
NUMBER OF FACE VALUE OF
CONTRACTS CONTRACTS<F1>
--------- --------------
Outstanding at October 31, 1999 97 $ 32,268
Contracts opened 719 258,116
Contracts closed (695) (246,219)
--------- --------------
Outstanding at April 30, 2000 121 $ 44,165
--------- --------------
<F1>The aggregate face value of contracts is computed on the date each contract
is opened.
The number of futures contracts and net unrealized appreciation, in thousands,
as of April 30, 2000, were as follows:
NUMBER OF UNREALIZED
CONTRACTS APPRECIATION
--------- ------------
S&P 500 Financial Futures Contract
Expiration date 6/00<F2> 121 $2,115
<F2>At April 30, 2000, U.S. Treasury Bills of $3,600, in thousands, were held as
collateral by the custodian in an initial margin account in connection with open
futures contracts held by the Equity Index Fund.
143
<PAGE>
MidCap Index Fund transactions in futures contracts during the period October
31, 1999 to April 30, 2000, in thousands, were as follows:
AGGREGATE
NUMBER OF FACE VALUE OF
CONTRACTS CONTRACTS<F1>
--------- -------------
Outstanding at October 31, 1999 -- $ --
Contracts opened 225 50,861
Contracts closed (192) (42,896)
--------- -------------
Outstanding at April 30, 2000 33 $ 7,965
--------- -------------
<F1>The aggregate face value of contracts is computed on the date each contract
is opened.
The number of futures contracts and net unrealized appreciation, in thousands,
as of April 30, 2000, were as follows:
NUMBER OF UNREALIZED
CONTRACTS APPRECIATION
--------- ------------
MidCap 400 Financial Futures Contract
Expiration date 6/00<F2> 33 $101
<F2>At April 30, 2000, U.S. Treasury Bills of $600, in thousands, were held as
collateral by the custodian in an initial margin account in connection with open
futures contracts held by the MidCap Index Fund.
At April 30, 2000, gross unrealized appreciation and depreciation of investments
for federal tax purposes, in thousands, were as follows:
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH AND EQUITY GROWTH
INCOME FUND GROWTH FUND INCOME FUND INDEX FUND FUND
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Appreciation .................... $ 10,705 $ 54,922 $ 189,458 $ 425,172 $ 138,289
(Depreciation) .................. (2,243) (7,515) (17,223) (37,798) (8,202)
--------------- --------------- --------------- --------------- ---------------
Net unrealized appreciation
on investments ................ $ 8,462 $ 47,407 $ 172,235 $ 387,374 $ 130,087
--------------- --------------- --------------- --------------- ---------------
<CAPTION>
MIDCAP SPECIAL EMERGING CORE
INDEX GROWTH GROWTH MICROCAP INTERNATIONAL
FUND FUND FUND FUND EQUITY FUND
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Appreciation .................... $ 15,765 $ 112,559 $ 45,953 $ 73,085 $ 3,218
(Depreciation) .................. (7,889) (27,386) (11,609) (35,553) (3,473)
--------------- --------------- --------------- --------------- ---------------
Net unrealized appreciation
(depreciation) on
investments ................... $ 7,876 $ 85,173 $ 34,344 $ 37,532 $ (255)
--------------- --------------- --------------- --------------- ---------------
<CAPTION>
SHORT-TERM INTERMEDIATE TAX-EXEMPT BOND
INTERNATIONAL BOND MARKET BOND MARKET INTERMEDIATE IMMDEX(TM)
EQUITY FUND FUND FUND BOND FUND FUND
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Appreciation .................... $ 9,648 $ 40 $ 356 $ 82 $ 12,615
(Depreciation) .................. (7,535) (3,169) (9,572) (2,041) (15,735)
--------------- --------------- --------------- --------------- ---------------
Net unrealized appreciation
(depreciation) on
investments ................... $ 2,113 $ (3,129) $ 9,216 $ (1,959) $ (3,120)
--------------- --------------- --------------- --------------- ---------------
</TABLE>
144
<PAGE>
At April 30, 2000, the cost of investments, in thousands, for federal income
tax purposes was $82,634, $183,379, $522,818, $435,986, $250,405, $96,531,
$416,476, $166,313, $286,932, $38,583, $57,591, $177,696, $393,338, $84,137 and
$499,159 for the Balanced Income, Balanced Growth, Growth and Income, Equity
Index, Growth, Midcap Index, Special Growth, Emerging Growth, MicroCap, Core
International Equity, International Equity, Short-Term Bond Market, Intermediate
Bond Market, Tax-Exempt Intermediate Bond and Bond IMMDEX(TM) Funds,
respectively. The difference between cost amounts for financial reporting and
tax purposes is primarily due to timing differences in recognizing certain gains
and losses on security transactions, for the Balanced Income Fund, a tax-free
conversion of a bank common trust fund and for the International Equity Fund,
passive foreign investment company (PFIC) value adjustments.
At October 31, 1999, the Short-Term Bond Market Fund had accumulated net
realized capital loss carryovers, in thousands, of $980, expiring in 2002. The
Short-Term Bond Market and Bond IMMDEX(TM) Funds had accumulated net realized
capital loss carryovers, in thousands, of $189 and $3, respectively, expiring in
2003. The Short-Term Bond Market and Bond IMMDEX(TM) Funds had accumulated net
realized capital loss carryovers, in thousands, of $79 and $24, respectively,
expiring in 2004. The Short-Term Bond Market Fund had accumulated net realized
capital loss carryovers, in thousands, of $1,083, expiring in 2005. The Emerging
Growth and International Equity Funds had accumulated net realized capital loss
carryovers, in thousands, of $5,736 and $4,919, respectively, expiring in 2006.
The Short-Term Bond Market, Intermediate Bond Market, Bond IMMDEX(TM), Emerging
Growth and International Equity Funds had accumulated net realized capital loss
carryovers, in thousands, of $604, $181, $88, $12,677 and $3,881, respectively,
expiring in 2007. To the extent each Fund realizes future net capital gains,
taxable distributions to its respective shareowners will be offset by any unused
capital loss carryover.
5. INVESTMENT ADVISORY AND OTHER AGREEMENTS
The Funds have entered into an Investment Advisory Agreement with Firstar
Investment Research & Management Company ("FIRMCO"). FIRMCO is a subsidiary of
Firstar Corporation, a publicly held bank holding company. Pursuant to its
Advisory Agreement with the Funds, the Adviser is entitled to receive a fee,
calculated daily and payable monthly, at the annual rates presented below as
applied to each Fund's daily net assets. Effective September 2, 1997
FIRMCO entered into a Sub-Advisory Agreement with Hansberger Global Investors
(the "Sub-Adviser") for the International Equity Fund. Prior to September 2,
1997, FIRMCO had entered into a sub-advisory agreement with State Street Global
Advisors for the International Equity Fund. FIRMCO has also entered into a
Sub-Advisory agreement with Glenmede Trust Company (the "Sub-Advisor") for the
Core International Equity Fund. Pursuant to the Sub-Advisory Agreements with
FIRMCO, the Sub-Advisors are entitled to receive a fee from FIRMCO, calculated
daily and payable monthly, at the annual rate presented below as applied to the
Core International Equity and International Equity Funds' daily net assets.
For the period ended April 30, 2000, FIRMCO voluntarily waived the following
fees, in thousands, by Fund:
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH AND EQUITY MIDCAP SPECIAL
INCOME GROWTH INCOME INDEX GROWTH INDEX GROWTH
FUND FUND FUND FUND FUND FUND FUND
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Annual Rate ... 0.75% 0.75% 0.75% 0.25% 0.75% 0.25% 0.75%
Fees Waived ... $ 60 $ 62 $ 15 $ 228 $ 19 $ 74 $ 38
<CAPTION>
EMERGING CORE SHORT-TERM INTERMEDIATE TAX-EXEMPT
GROWTH MICROCAP INTERNATIONAL INTERNATIONAL BOND MARKET BOND MARKET INTERMEDIATE
FUND FUND EQUITY FUND EQUITY FUND FUND FUND BOND FUND
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Annual Rate ... 0.75% 1.50% <F2><F3> <F4><F5> 0.60% 0.50% 0.50%
Fees Waived ... -- -- $ 95 $ 70 $ 270 $ 226 $ 83
<CAPTION>
BOND MONEY INSTITUTIONAL TAX-EXEMPT U.S. GOVERNMENT U.S TREASURY
IMMDEX(TM) MARKET MONEY MARKET MONEY MARKET MONEY MARKET MONEY MARKET
FUND FUND FUND FUND FUND FUND
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Annual Rate ........................ 0.30% <F1> <F1> <F1> <F1> <F1>
Fees Waived ........................ -- $ 219 $ 2,187 -- $ 42 $ 3
</TABLE>
<F1>FIRMCO is entitled to receive a fee, calculated daily and payable monthly,
at the annual rate of 0.50% on the first $2 billion of each Fund's average
daily net assets, and 0.40% of each Fund's average daily net assets in
excess of $2 billion.
<F2>FIRMCO is entitled to receive a fee, calculated daily and payable monthly,
at the annual rate of 1.25% of the Fund's first $50 million of average daily
net assets, and 1.05% of the Fund's average daily net assets in excess of
$50 million.
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<PAGE>
<F3>Pursuant to the sub-advisory agreements with FIRMCO, the sub-advisor is
entitled to receive a fee from FIRMCO calculated daily and payable monthly,
at the annual rate of 0.50% of the Fund's first $50 million of average daily
net assets, and 0.30% of the Fund's average daily net assets in excess of
$50 million.
<F4>FIRMCO is entitled to receive a fee, calculated daily and payable monthly,
at the annual rate of 1.50% of the Fund's first $25 million of average daily
net assets, 1.25% on the next $75 million and 1.10% of the Fund's average
daily net assets in excess of $100 million.
<F5>Pursuant to its Sub-Advisory Agreement with FIRMCO, the Sub-Adviser is
entitled to receive a fee from FIRMCO, calculated daily and payable monthly,
at the annual rate of 0.75% of the Fund's first $25 million of average daily
net assets, 0.50% on the next $75 million and 0.35% of the Fund's average
daily net assets in excess of $100 million.
Chase Manhattan Bank serves as sub-custodian for the Core International
Equity and International Equity Funds. Firstar Bank Milwaukee, N.A. serves as
custodian and Firstar Mutual Fund Services, LLC serves as transfer agent and
accounting services agent for all the Funds. Both companies are affiliates of
FIRMCO.
The Company has entered into a Co-Administration Agreement with B.C. Ziegler
and Company and Firstar Mutual Fund Services, LLC (the "Co-Administrators") for
certain administrative services. Pursuant to the Co-Administration Agreement
with the Company, the Co-Administrators are entitled to receive a fee, computed
daily and payable monthly, at the annual rate of 0.125% of the Company's first
$2 billion of average aggregate daily net assets, plus 0.10% of the Company's
average aggregate daily net assets in excess of $2 billion. For the period ended
April 30, 2000, $400 of administration fees, in thousands, were waived for the
Institutional Money Market Fund.
The Company has entered into Servicing Agreements with certain Service
Organizations, including FIRMCO affiliates, for the non-money market Series A
and Series B classes of shares. The Service Organizations are entitled to
receive fees from the Funds up to the annual rate of 0.25% of the average daily
net asset value of the Series A and Series B Shares for certain support and/or
distribution services to customers of the Service Organizations who are
beneficial owners of Series A and Series B Shares. These services may include
assisting customers in processing purchase, exchange and redemption requests;
processing dividend and distribution payments from the Funds; and providing
information periodically to customers showing their positions in Series A and
Series B Shares. Service Organization fees, in thousands, incurred by the
Short-Term Bond Market, Intermediate Bond Market, Tax-Exempt Intermediate Bond,
Bond IMMDEX(TM), Balanced Income, Balanced Growth, Growth and Income, Equity
Index, Growth, MidCap Index, Special Growth, Emerging Growth, MicroCap, Core
International Equity and International Equity Funds aggregated $76, $41, $22,
$114, $18, $68, $235, $192, $64, $1, $125, $14, $48, $0, and $8, respectively,
for the period ended April 30, 2000.
The Funds have adopted a Service and Distribution Plan pursuant to Rule 12b-1
of the Investment Company Act of 1940 for the Series A, the Series B and the
money market funds' shareholders. The Funds paid no 12b-1 fees with respect to
the Series A Shares or the money market funds for the current fiscal year except
for the Money Market Fund, which incurred $50, in thousands, for the period
ended April 30, 2000. The Funds paid 0.75% in 12b-1 fees with respect to Series
B Shares for the current fiscal year. For the period ended April 30, 2000, the
Short-Term Bond Market, Intermediate Bond Market, Tax-Exempt Intermediate Bond,
Bond IMMDEX(TM), Balanced Income, Balanced Growth, Growth and Income, Equity
Index, Growth, MidCap Index, Special Growth, Emerging Growth, MicroCap, Core
International Equity and International Equity Funds incurred expenses, in
thousands, of $2, $1, $0, $7, $10, $3, $8, $26, $4, $0, $1, $1, $3, $0, and $1,
respectively.
Each Director of the Company who is not affiliated with FIRMCO receives an
annual fee from the Company for service as a Director and is eligible to
participate in a deferred compensation plan with respect to these fees.
Participants in the plan may designate their deferred Director's fees as if
invested in any one of the Firstar Funds (with the exception of the MicroCap
Fund) or in 90-day U.S. Treasury bills. The value of each Director's deferred
compensation account will increase or decrease as if it were invested in shares
of the selected Firstar Funds or 90-day U.S. Treasury bills. The Funds maintain
their proportionate share of the Company's liability for deferred fees.
6. FOREIGN SECURITIES
Investing in securities of foreign companies and foreign governments involves
special risks and considerations not typically associated with investing in
U.S.companies and the U.S. Government. These risks include revaluation of
currencies and future adverse political and economic developments. Moreover,
securities of many foreign companies and foreign governments and their markets
may be less liquid and their prices more volatile than those of securities of
comparable U.S. companies and the U.S.Government.
7. SECURITIES LENDING
The Funds have entered into a securities lending agreement with the custodian.
Under the terms of the agreement, the Funds receive a negotiable percentage of
the annual net income from lending transactions. In exchange for such fees, the
custodian is authorized to loan securities on behalf of the funds, against
receipt of collateral at least equal in value to the value of the securities
loaned. The funds bear the risk of any deficiency in the amount of collateral
available for return due to a loss in an approved instrument. As of April 30,
2000, the Funds had on loan securities valued at $82,038,600.
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<PAGE>
8. TRANSACTIONS WITH AFFILIATES
The following companies are affiliated with the Funds either directly, or by
the Fund holding 5% or more of the outstanding voting securities during the
period ended April 30, 2000. Such companies are defined in Section (2)(a)(3) of
the Investment Company Act of 1940.
<TABLE>
<CAPTION>
SHARE BALANCE AT SHARE BALANCE AT
COMPANY OCTOBER 31, 1999 PURCHASES SALES APRIL 30, 2000 DIVIDENDS GAIN/LOSSES
------- --------------- --------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Firstar Corporation ......... 59,737 -- -- 59,737 $ 19,415 --
(held in Equity Index Fund)
</TABLE>
147
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK.
<PAGE>
FIRSTAR FUNDS ARE AVAILABLE THROUGH:
o the Firstar Funds Center.
o Financial Consultants who are either registered
representatives of Firstar Investment Services, Inc.
a registered broker/dealer NASD and SPIC member, or
registered representatives of MDS Securities,
a division of Conseco Financial Services, Inc.,
a registered broker/dealer, NASD and SIPC member,
o and through selected shareholder organizations.
THIS REPORT IS AUTHORIZED FOR DISTRIBUTION ONLY WHEN PRECEDED OR ACCOMPANIED BY
A CURRENT PROSPECTUS.
For Account Balance and Investor Services Information
1-800-677-FUND
1-414-287-3808
Firstar Funds Center
615 East Michigan Street
P.O. Box 3011
Milwaukee, WI 53201-3011
www.firstarfunds.com
