THE FUND FOR LIFE SERIES
OF
THE GCG TRUST
SEMI-ANNUAL
FINANCIAL STATEMENTS
JUNE 30, 1995
(Unaudited)
THE FUND FOR LIFE SERIES
OF
THE GCG TRUST
FINANCIAL STATEMENTS
JUNE 30, 1995
(Unaudited)
CONTENTS
President's Report 1
Statement of Assets and Liabilities
At June 30, 1995 2
Statement of Operations
For the Six Months Ended June 30, 1995 3
Statement of Changes in Net Assets
For the Six Months Ended June 30, 1995
And the Year Ended December 31, 1994 4
Financial Highlights
For the Six Months Ended June 30, 1995,
The Year Ended December 31, 1994 and
For the Period March 1, 1993 (Commencement of Operations) 5
To December 31, 1993
Portfolio of Investments
At June 30, 1995 6
Notes to the Financial Statements 7
Dear Shareholder of The Fund for Life:
I am pleased to provide you with the 1995 semi-annual report for the Fund
For Life Series of the GCG Trust.
The first half of 1995 saw U.S. equity markets rise to record levels,
and bond prices rebounded as interest rates declined. The Fund For
Life's strong performance in this period reflected those economic
trends.
While we were pleased with the Fund's performance in the first half of
1995, we noted that the fund carried a relatively high expense ratio.
Accordingly, we offered all shareholders the opportunity to exchange
their existing annuity contract for our GoldenSelect DVA contract, a
deferred variable annuity with access to twelve different investment
portfolios, plus a fixed interest division. Many shareholders accepted
that offer.
As we expect to the Fund's expense ratio to rise further, we are
considering various options to address the interests of the Fund's
shareholders.
If you have any questions or require any additional information, please
call our Customer Service Area at 1-800-366-0066.
Thank You!
Sincerely,
Terry L. Kendall
President
THE FUND FOR LIFE SERIES
OF
THE GCG TRUST
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1995
(Unaudited)
<TABLE>
<S> <C>
ASSETS:
Investments, at value (Cost $452,009) (Notes 1 and 4) $495,846
Cash 31,173
Dividends Receivable 986
--------
Total Assets 528,005
--------
LIABILITIES:
Accrued Expenses 7,418
Payable for shares of beneficial interest redeemed 38,756
--------
Total Liabilities 46,174
--------
NET ASSETS $481,831
========
NET ASSETS CONSIST OF:
Paid-in Capital $406,255
Undistributed realized gains on investments sold 45,412
Net unrealized appreciation of investments 43,837
Accumulated net deficit (13,673)
--------
Net Assets, at value $481,831
========
Shares of beneficial interest outstanding 46,493
========
Net Asset Value, Redemption Price and Offering
Price per share $ 10.36
========
</TABLE>
See notes to financial statements.
(2)
THE FUND FOR LIFE SERIES
OF
THE GCG TRUST
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 1995
(Unaudited)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends $ 10,536
---------
Total Investment Income 10,536
---------
EXPENSES:
Management & administrative fees (Note 2) 1,913
Amortization of organization costs (Note 2) 10,436
Auditing fees 973
Fund accounting fees (Note 2) 1,594
Legal fees 3,533
Printing and mailing 3,967
Custody (Note 2) 1,016
Other operating expenses 777
---------
Total Expenses 24,209
---------
NET INVESTMENT LOSS (13,673)
---------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain from investment transactions 45,412
Net change in unrealized appreciation 112,284
---------
NET REALIZED AND UNREALIZED GAIN FROM INVESTMENT
TRANSACTIONS 157,696
---------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 144,023
========
</TABLE>
See notes to financial statements.
(3)
THE FUND FOR LIFE SERIES
OF
THE GCG TRUST
STATEMENTS OF CHANGES IN NET ASSETS
For the Six Months Ended June 30, 1995 and
The Year Ended December 31, 1994
(Unaudited)
<TABLE>
<CAPTION>
1995 1994
---------- ---------
<S> <C> <C>
FROM OPERATIONS:
Net investment income (loss) $ (13,673) $ 57,602
Net realized gain from investment transactions 45,412 80,430
Net unrealized appreciation (depreciation) of investments 112,284 (178,204)
---------- -----------
Net increase (decrease) in net assets resulting from
operations 144,023 (40,172)
---------- -----------
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income 0 57,602
Net realized gain on investments 0 80,430
---------- -----------
Total dividends to shareholders 0 138,032
---------- -----------
FROM BENEFICIAL INTEREST TRANSACTIONS:
Proceeds from sale of shares 5,164 88,920
Dividends reinvested 0 138,032
Cost of shares redeemed (1,013,342) (2,969,759)
---------- -----------
Decrease in net assets derived from beneficial interest
transactions (1,008,178) (2,742,807)
---------- -----------
Net decrease in net assets (864,155) (2,921,011)
NET ASSETS:
Beginning of period 1,345,986 4,266,997
---------- -----------
End of period $ 481,831 $ 1,345,986
========== ===========
</TABLE>
See notes to financial statements.
(4)
THE FUND FOR LIFE SERIES
OF
THE GCG TRUST
Financial Highlights
Selected Data For A Share Of Beneficial Interest
Outstanding Throughout Each Period
<TABLE>
<CAPTION>
For the Six Months
Ended June 30, For the Year Ended For the Period March 1,
1995 December 31, 1993*** to December 31,
(Unaudited) 1994 1993
__________________ __________________ _________________________
<S> <C> <C> <C>
Per Share Operating Performance
Net asset value, beginning of period $ 9.23 $10.51 $10.00
------ ------ ------
Net investment income (loss) (.11)# 0.44 0.33
Net gain on securities--realized and
unrealized 1.24 # (.67) 0.51
------ ------ ------
Total from investment operations 1.13 (0.23) 0.84
------ ------ ------
Less distributions:
Dividends from net investment income 0.00 0.44 0.33
Distributions from net realized capital gains 0.00 0.61 0.00
------ ------ ------
Total distributions 0.00 1.05 0.33
------ ------ ------
Net asset value, end of period $10.36 $ 9.23 $10.51
====== ====== ======
Total Return 12.24%** (2.15%) 8.42%**
Ratios and Supplemental Data
Total net assets, end of period (000's omitted) $ 482 $1,346 $4,267
====== ====== ======
Ratio of expenses to average net assets 3.83%* 1.84% 0.42%**
Decrease reflected in above expense ratio due to
expense limitations -- -- 3.15%**
Ratio of net investment income (loss) to average
net assets (2.17)* 2.23% 4.89%**
Portfolio turnover rate 1.03% 13.06% 19.79%
</TABLE>
* Annualized
** Not Annualized
*** Commencement of Operations
# Per share numbers have been calculated using the average shares method.
See notes to financial statements.
(5)
THE FUND FOR LIFE SERIES
OF
THE GCG TRUST
PORTFOLIO OF INVESTMENTS
June 30, 1995
(Unaudited)
<TABLE>
<CAPTION>
Number
of Value
Shares (Note 1)
---------- ---------
<S> <C> <C> <C>
ASSETS:
Investments in shares of open-end
mutual funds - 102.9%
AIM Constellation Fund 3,137 $ 66,620
AIM Weingarten Fund 1,818 33,788
The Berger One Hundred Fund, Inc. 2,887 49,749
The Guardian Park Avenue Fund 1,536 49,785
Merrill Lynch Pacific Fund, Inc. Class A 2,371 49,009
New York Venture Fund, Inc. 3,561 49,350
Scudder Income Fund 3,665 49,226
United Income Fund 1,787 49,985
Vanguard Investment Grade Corporate Bond Fund 5,472 49,030
Vanguard Fixed Income GNMA Fund 4,829 49,304
---------
Total Investments (Cost $452,009) 102.9% 495,846
Other Liabilities In Excess Of Other Assets -2.9% (14,015)
------- ---------
NET ASSETS 100% 481,831
------- ---------
------- ---------
</TABLE>
See notes to financial statements.
THE FUND FOR LIFE SERIES
OF
THE GCG TRUST
Notes to Financial Statements
(Unaudited)
1. Summary of Significant Accounting Policies
The GCG Trust, (the "Trust") is registered under the Investment
Company Act of 1940 (the "Act") as an open-end management company. The
Trust was organized as a Massachusetts business trust on August 3, 1988
with an unlimited number of shares of beneficial interest with a par value
of $0.001 each. At June 30, 1995, the Trust had thirteen operational
portfolios (the "Series"): The Fund For Life Series (the "Fund"), Liquid
Asset Series, Limited Maturity Bond Series, Natural Resources Series, All-
Growth Series, Real Estate Series, Fully Managed Series, Multiple
Allocation Series, Capital Appreciation Series, Rising Dividends Series,
Emerging Markets Series, Market Manager Series and Value Equity Series.
All of the Series, including the Fund are diversified, except for Market
Manager Series. The information presented in this financial statements
pertain only to the Fund. The financial information for the other Series
of the Trust is presented under separate cover.
The Fund serves as an investment medium for variable annuity
contracts offered by Golden American Life Insurance Company ("Golden
American"). Golden American is a wholly-owned subsidiary of BT Variable,
Inc. ("BTV"), an indirect subsidiary of Bankers Trust Company ("Bankers
Trust").
The following is a summary of significant accounting policies
consistently followed by the Fund in the preparation of its financial
statements. The policies are in conformity with generally accepted
accounting principals.
Federal income taxes: No provision for federal income taxes has
been made since the Fund has complied and intends to continue to comply
with the provisions of the Internal Revenue Code available to regulated
investment companies and to distribute its taxable income to shareholders
sufficiently to relieve it from substantially all federal income taxes.
Organizational Expenses: Directed Services, Inc. ("DSI"), a
wholly-owned subsidiary of BTV and the Fund's Manager and Administrator, paid
organizational expenses of approximately $114,000 on behalf of the Fund.
The Fund reimburses DSI in equal monthly installments over a sixty month
period from the Fund's commencement of operations. The unpaid balance as
of June 30, 1995 was approximately $60,600. It is DSI's intention to
continue to receive these equal installments but not to seek reimbursement
of any unpaid balances, if any, should the Fund cease operations.
Valuation: Investments in open-end mutual funds are valued at
their respective net asset value at the end of each day. Net asset values
for these investments are supplied by market quotation services. The net
asset values supplied by these market quotation services are calculated in
accordance with the Act. Among other things, the Act requires that mutual
funds value the securities that they hold in their portfolios at their
current market value (generally the last reported sales price of the
security).
Other investments of the Fund, if any, are valued at their current
market value as determined by market quotations. Securities having 60
days or less remaining to maturity are valued at their amortized cost.
Other: Investment transactions are recorded on trade date.
Dividend income and distributions to the shareholders are recorded on the
ex-dividend date. Estimated expenses are accrued daily. Realized
(7)
1.Summary of Significant Accounting Policies (Continued)
gains and losses from investment transactions are recorded on an identified
cost basis which is the same basis the Fund uses for federal income tax
purposes.
2.Management and Administrative Fees, and Other Transactions with
Affiliates
DSI serves as Manager and Administrator to the Fund. In its
capacity as Manager and Administrator DSI provides investment advisory
services and services reasonably necessary for the operation of the Fund.
Management and administrative fees are paid to DSI at annual rates of 0.10%
and 0.20%, respectively, of the value of the average daily net assets of
the Fund. For the six months ended June 30, 1995, the Fund paid $1,275
and $638 in compensation for management and administrative services
respectively. The Fund also reimburses DSI for certain organizational
expenses paid by DSI on behalf of the Fund. These reimbursements are
described in Note 1 to the financial statements.
DSI also provides accounting services to the Fund. For fund
accounting services, the Fund pays to DSI an annual fee of 0.25% of the
value of the average daily net assets of the Fund. For the six months
ended June 30, 1995 such fees amounted to $1,594. Fees paid to Bankers
Trust in connection with custodian services was $1,016 for the six months
ended June 30, 1995.
Pursuant to a custodian agreement, Bankers Trust is the custodian
for the Fund.
Investors in the Fund should recognize that an investment in the
Fund bears not only a proportionate share of the expenses of the Fund
(including operating costs and management fees) but also indirectly
similar expenses of the underlying mutual funds in which the Fund invests.
Investors also bear their proportionate share of any sales charges
incurred by the Fund related to the purchase of shares of the mutual fund
investments. In addition, shareholders of the Fund may indirectly bear
expenses paid by a mutual fund in which the Fund invests related to the
distribution of the mutual fund's shares.
Certain officers and trustees of the Trust are also officers and/or
directors of DSI, BTV, Golden American and Bankers Trust.
3.Shares of Beneficial Interest
The Trust has an unlimited number of $.001 par value shares of
beneficial interest authorized. For the six months ended June 30, 1995
and the year ended December 31, 1994, the Fund had the following
transactions in shares of beneficial interest. The Trust no longer offers
investments in the Fund from new investors.
<TABLE>
<CAPTION>
1995 1994
Shares Amount Shares Amount
<S> <C> <C> <C> <C>
Sold . . . . . . . . . . . . . . . . . 514 $ 5,164 8,358 $ 88,920
Dividends and other distributions
reinvested . . . . . . . . . . . . 0 0 14,955 138,032
Redeemed . . . . . . . . . . . . . . (99,815) (1,013,342) (283,623) (2,969,759)
------- ----------- -------- -----------
Net (decrease) increase . . . . . . . (99,301) $(1,008,178) (260,310) $(2,742,807)
======= =========== ======== ===========
</TABLE>
As of June 30, 1995, Golden American has an investment in the Fund of
1,149 shares with a total net asset value of $ 11,904 representing 2.56 % of
shares outstanding
(8)
4.Investments
At June 30, 1995, the cost of Investments, Unrealized Appreciation and
Depreciation, and Purchases and Sales of Investments were as follows:
Gross Unrealized Appreciation . . . . . . . . . . . $ 45,648
Gross Unrealized Depreciation . . . . . . . . . . . (1,811)
----------
Net Unrealized Appreciation . . . . . . . . . . . . $ 43,837
==========
Cost of Investment Securities for Federal Income
Tax Purposes . . . . . . . . . . . . . . . . . . $ 452,009
==========
Purchases and Sales of Investments
Cost of Purchases . . . . . . . . . . . . . . . . . $ 11,437
===========
Proceeds from Sales . . . . . . . . . . . . . . . . $ 1,018,088
===========
(9)
