<PAGE> 1
FREMONT MUTUAL FUNDS, INC.(R)
SEMI-ANNUAL REPORT
[COVER GRAPHIC]
APRIL 30, 1997
[FREMONT FUNDS LOGO]
<PAGE> 2
FREMONT FUNDS
A MESSAGE FROM MICHAEL H. KOSICH, PRESIDENT OF FREMONT MUTUAL FUNDS
[PHOTO OF MIKE KOSICH]
Dear Fellow Shareholder:
We are pleased to update you on our nine mutual funds and to detail some of
the recent developments at our firm.
We are happy to report that six of our nine funds outperformed their
benchmarks in fiscal first-half 1997. Fremont Emerging Markets Fund Portfolio
Manager Henry Thornton deserves special mention. In its first complete six-month
reporting period, the Fund exceeded its benchmark indices--the Morgan Stanley
Capital Emerging Markets Free Index and IFC Investable Index--by 50% and 69%,
respectively. The Fremont International Growth, International Small Cap, Bond,
Money Market and California Intermediate Tax-Free Funds all comfortably
outperformed their indices, while the Global and U.S. Micro-Cap Funds fell just
short of their investment yardsticks. While the Fremont Growth Fund materially
lagged the S&P 500 Index (11.13% versus 14.72%), it outdistanced the competition
as represented by the Lipper Growth Fund Average's 6.98% gain.
In an important step to ensure the continuity of Fremont Funds' portfolio
management team, Fremont Investment Advisors, Inc. has officially hired Robert
E. (Bob) Kern, Portfolio Manager of Fremont U.S. Micro-Cap Fund. Bob and his
son, David, the former manager of Founders Discovery Fund, are planning to form
their own firm, Kern Capital Management L.L.C., which, with trustee and
shareholder approval, will become the new sub-advisor to the U.S. Micro-Cap
Fund. Two other members of Morgan Grenfell's small-cap team, trader Mike Murphy
and research analyst Greg Weaver, are joining Bob at Kern Capital and will
continue to provide support for the U.S. Micro-Cap Fund.
Also, Fremont Funds has contracted with National Financial Data Services,
Inc. (NFDS), a new transfer agent, to handle your account servicing needs. We
are greatly impressed with NFDS' blue-chip reputation in the industry and will
be working closely with them to develop new and improved shareholder statements
and state-of-the-art shareholder service programs. We will be sending you more
information about the services offered by NFDS in the months ahead.
We thank you for your appreciation of our investment skills and remain
dedicated to helping you achieve your financial goals.
Sincerely,
/s/ Michael H. Kosich
Michael H. Kosich
President
<PAGE> 3
FREMONT FUNDS
TABLE OF CONTENTS
FUND PROFILES AND LETTERS TO SHAREHOLDERS
Fremont Global Fund............................... 2
Fremont International Growth Fund................. 5
Fremont International Small Cap Fund.............. 8
Fremont Emerging Markets Fund.................... 11
Fremont U.S. Micro-Cap Fund...................... 14
Fremont Growth Fund.............................. 16
Fremont Bond Fund................................ 18
Fremont Money Market Fund........................ 20
Fremont California Intermediate Tax-Free Fund.... 22
STATEMENTS OF INVESTMENTS
Fremont Global Fund.............................. 25
Fremont International Growth Fund................ 30
Fremont International Small Cap Fund............. 32
Fremont Emerging Markets Fund.................... 35
Fremont U.S. Micro-Cap Fund...................... 36
Fremont Growth Fund.............................. 38
Fremont Bond Fund................................ 40
Fremont Money Market Fund........................ 42
Fremont California Intermediate Tax-Free Fund.... 44
COMBINED FINANCIAL STATEMENTS
Statements of Assets and Liabilities............. 46
Statements of Operations......................... 48
Statements of Changes in Net Assets.............. 50
FINANCIAL HIGHLIGHTS............................. 54
NOTES TO FINANCIAL STATEMENTS.................... 59
1
<PAGE> 4
FREMONT FUNDS
FREMONT GLOBAL FUND
The Fremont Asset Allocation Committee, Portfolio Managers for Fremont Global
Fund Dave Redo, Pete Landini, Bob Haddick, Sandie Kinchen, Vince Kuhn
[PHOTO]
The Fremont Asset Allocation Committee
Vince Kuhn, Sandie Kinchen, Dave Redo, Bob Haddick, Pete Landini
FUND PROFILE
Fremont Global Fund offers conservative investors a balanced approach to global
investing. The Fund management team understands the reward potential and perhaps
more importantly, the risks in global financial markets. Through country
diversification, prudent allocation between stocks, bonds and cash, and
disciplined securities selection, the Fund seeks total returns equaling at least
80% of the global equities markets with only half the downside risk as measured
by portfolio beta.
The Fund's five-member portfolio management team employs a three-step
investment process. First, economic growth, inflation, and interest rate
forecasts are developed to identify those regions and individual countries
offering the best investment opportunities. Second, financial market data is
examined to determine the most advantageous mix of stocks, bonds and cash.
Finally, individual securities are selected based on intensive quantitative and
fundamental analysis. On the equities side, Fund management favors large
companies with strong balance sheets and consistent earnings records. Individual
bonds are chosen based on credit quality and opportunistic pricing.
Successful global investing requires seasoned professional management. The
Fund's portfolio management team collectively has over 100 years of global
investing experience.
FREMONT GLOBAL FUND INVESTMENT RETURNS
<TABLE>
<CAPTION>
ANNUAL RETURNS
<S> <C>
11/18/88-10/31/89* +13.71%
11/01/89-10/31/90 -2.64%
11/01/90-10/31/91 +18.38%
11/01/91-10/31/92 +7.10%
11/01/92-10/31/93 +17.51%
11/01/93-10/31/94 +1.74%
11/01/94-10/31/95 +12.78%
11/01/95-10/31/96 +13.72%
11/01/96- 4/30/97* +6.37%
AVERAGE ANNUAL +10.30% (SINCE INCEPTION)
</TABLE>
GROWTH OF $10,000+
AVERAGE ANNUAL RETURNS FOR
PERIODS ENDED 4/30/97
<TABLE>
<CAPTION>
1 5 SINCE INCEPTION
YEAR YEARS 11/18/88
<S> <C> <C>
10.45% 11.14% 10.30%
</TABLE>
<TABLE>
<CAPTION>
Global Lehman EAFE
Date Fund S&P 500 Bros. Corp/Govt Salomon
<S> <C> <C> <C> <C> <C>
Nov 18, 88 10000 10000 10000 10000 10000
Nov 30, 88 10040 10281 9966 10161 10004
Dec 31, 88 10123 10467 9975 10218 10084
Jan 31, 89 10415 11223 10080 10398 10141
Feb 28, 89 10325 10944 10037 10451 10055
Mar 31, 89 10506 11201 10081 10246 10125
Apr 30, 89 10677 11777 10282 10341 10223
May 31, 89 10828 12254 10486 9779 10228
Jun 30, 89 10878 12187 10750 9614 10317
Jul 31, 89 11391 13281 10970 10822 10542
Aug 31, 89 11512 13538 10829 10335 10551
Sep 30, 89 11462 13485 10880 10806 10495
Oct 31, 89 11371 13167 11110 10371 10489
Nov 30, 89 11519 13439 11216 10893 10465
Dec 31, 89 11735 13758 11247 11295 10500
Jan 31, 90 11373 12835 11175 10874 10292
Feb 28, 90 11331 13000 11217 10116 10138
Mar 31, 90 11373 13341 11231 9062 10133
Apr 30, 90 11203 13010 11192 8990 10125
May 31, 90 11810 14278 11438 10016 10376
Jun 30, 90 11842 14180 11591 9928 10430
Jul 31, 90 11927 14134 11753 10068 10471
Aug 31, 90 11341 12857 11704 9090 10330
Sep 30, 90 10873 12224 11795 7823 10272
Oct 31, 90 11070 12179 11931 9042 10567
Nov 30, 90 11349 12961 12112 8509 10740
Dec 31, 90 11527 13318 12278 8647 10847
Jan 31, 91 11797 13907 12403 8926 11053
Feb 28, 91 12270 14902 12501 9883 11216
Mar 31, 91 12315 15255 12586 9290 11221
Apr 30, 91 12371 15297 12724 9381 11276
May 31, 91 12607 15955 12802 9479 11343
Jun 30, 91 12258 15228 12811 8782 11282
Jul 31, 91 12596 15940 12954 9213 11384
Aug 31, 91 12810 16315 13202 9026 11531
Sep 30, 91 12911 16046 13429 9535 11719
Oct 31, 91 13105 16259 13582 9671 11802
Nov 30, 91 12872 15604 13738 9219 11840
Dec 31, 91 13676 17386 14073 9695 12051
Jan 31, 92 13595 17064 13946 9488 12152
Feb 29, 92 13747 17282 14001 9148 12192
Mar 31, 92 13466 16945 13946 8544 12123
Apr 30, 92 13501 17440 14068 8585 12160
May 31, 92 13773 17533 14286 9160 12292
Jun 30, 92 13655 17277 14498 8726 12342
Jul 31, 92 13808 17975 14786 8502 12428
Aug 31, 92 13844 17612 14934 9035 12468
Sep 30, 92 13964 17815 15138 8856 12673
Oct 31, 92 14035 17879 14941 8392 12889
Nov 30, 92 14218 18482 14884 8471 12895
Dec 31, 92 14389 18722 15083 8515 13017
Jan 31, 93 14450 18858 15375 8514 13154
Feb 28, 93 14609 19115 15618 8771 13395
Mar 31, 93 14916 19527 15681 9536 13358
Apr 30, 93 14940 19049 15806 10441 13351
May 31, 93 15089 19558 15771 10662 13416
Jun 30, 93 15212 19623 16019 10495 13666
Jul 31, 93 15423 19526 16058 10863 13819
Aug 31, 93 15896 20263 16313 11449 14091
Sep 30, 93 16095 20114 16381 11192 14185
Oct 31, 93 16493 20527 16425 11536 14369
Nov 30, 93 16330 20342 16333 10528 14490
Dec 31, 93 17209 20592 16408 11288 14763
Jan 31, 94 17436 21284 16590 12242 14650
Feb 28, 94 16944 20707 16344 12208 14362
Mar 31, 94 16249 19808 16075 11683 14273
Apr 30, 94 16312 20064 15965 12178 14194
May 31, 94 16375 20392 15976 12108 14084
Jun 30, 94 16198 19887 15978 12279 13930
Jul 31, 94 16514 20545 16208 12397 14026
Aug 31, 94 16982 21381 16259 12691 13893
Sep 30, 94 16615 20864 16109 12291 13934
Oct 31, 94 16780 21344 16108 12700 13982
Nov 30, 94 16447 20560 16035 12089 14163
Dec 31, 94 16491 20862 16091 12166 14169
Jan 31, 95 16310 21403 16362 11699 14319
Feb 28, 95 16516 22231 16700 11665 14501
Mar 31, 95 16877 22889 16795 12392 14821
Apr 30, 95 17238 23564 17004 12858 15059
May 31, 95 17851 24498 17517 12705 15540
Jun 30, 95 18060 25073 17635 12483 15517
Jul 31, 95 18608 25908 17636 13261 15702
Aug 31, 95 18568 25968 17797 12756 15813
Sep 30, 95 18858 27051 17925 13004 16073
Oct 31, 95 18924 26975 18124 12654 16240
Nov 30, 95 19204 28161 18361 13006 16571
Dec 31, 95 19669 28683 18554 13530 16710
Jan 31, 96 20294 29669 18714 13586 16896
Feb 29, 96 20225 29955 18495 13632 16707
Mar 31, 96 20294 30244 18401 13921 16869
Apr 30, 96 20725 30688 18336 14326 17034
May 31, 96 20865 31480 18321 14063 17162
Jun 30, 96 21006 31599 18516 14141 17304
Jul 31, 96 20458 30203 18571 13728 17420
Aug 31, 96 20727 30840 18586 13759 17552
Sep 30, 96 21392 32576 18844 14125 17907
Oct 31, 96 21520 33474 19178 13984 18201
Nov 30, 96 22474 36005 19431 14540 18539
Dec 31, 96 22416 35291 19307 14353 18471
Jan 31, 97 22856 37496 19382 13851 18696
Feb 28, 97 23019 37790 19419 14077 18816
Mar 31, 97 22498 36238 19285 14128 18746
Apr 30, 97 22892 38401 19512 14203 18926
</TABLE>
* Unannualized
+ Assumes initial investment of $10,000 on inception date, November 18, 1988.
Performance data illustrated is historical. Past performance is not
predictive of future performance. Share price and return will vary so that
a gain or loss may be realized when shares are sold. All performance
figures assume reinvestment of dividends. Management fees and other
expenses are included in the Fund's performance; however, fees and expenses
are not incorporated in the S&P 500 Index, the Morgan Stanley Capital
International EAFE Index, the Salomon Non-U.S. Government Bond Index
(currency hedged), or the Lehman Bros. Intermediate Government/Corporate
Bond Index.
2
<PAGE> 5
FREMONT FUNDS
FREMONT GLOBAL FUND
GEOGRAPHIC DIVERSIFICATION AS OF APRIL 30, 1997
[GLOBAL MAP GRAPHIC]
<TABLE>
<S> <C>
CANADA 2.7%
EUROPE 20.5%
JAPAN 3.5%
UNITED STATES 62.1%
PACIFIC RIM 8.4%
EMERGING MARKETS -
LATIN AMERICA 0.9%
EMERGING MARKETS -
OTHER 1.9%
</TABLE>
TO OUR SHAREHOLDERS
In first-half fiscal 1997, ended April 30, Fremont Global Fund returned
6.37% compared to the Lipper Global Flexible Fund Average's 6.63%.
Our early November 1996 decision to become more fully invested benefited
the Fund as global financial markets as a whole materially outperformed cash
equivalents over the last six months. The Fund's underweighting in Japan was
also a positive factor, as the Japanese stock market continued to struggle. Our
Pacific Rim equities investments did well in general, but positions in Asian
emerging markets like Thailand and South Korea suffered as both these markets
sold off. European, Canadian, Australian, and Latin American bonds continued to
perform well during this period.
The Fund is currently 90% invested in stocks and bonds with just 10% in
cash reserves. This posture reflects the ongoing favorable outlook for global
financial markets. Despite evidence of some inflationary pressure on the U.S.
economy and the Federal Reserve's March rate hike, we believe U.S. stocks will
trend higher. Over the short term, we will have to cope with volatility as
investors digest often contradictory economic data and inflationary fears rise
and fall. However, we believe the economy will slow and that we will continue to
enjoy an environment of moderate, sustainable economic growth, low inflation,
and decent corporate earnings gains. We do not expect to see the kind of robust
returns we enjoyed in 1995 and 1996. However, returns in the high single digits
to low teens are achievable over the next 12 months.
As U.S. stock investors, we are still in the value camp, overweighting
energy and financial service stocks and underweighting technology and the richly
priced consumer non-durables. Over the near term, U.S. bonds may have a more
difficult time bucking the headwind of rising interest rates and we could see
long bond yields as high as 7.25%. We believe this foreshadows a bond rally that
could see yields drop as low as 6.5% within the next year.
In Europe, we are forecasting 2 to 2.5% GDP growth. Stock markets in
developed nations on the continent should perform better than the United Kingdom
market, which is likely to face rising interest rates under the new Labor
government, and the Italian and Spanish markets, which may suffer from
government imposed economic restraints necessary to qualify for European
Monetary Union. Germany is our current favorite. The exodus of some
manufacturing jobs to Eastern Europe has reduced the power of labor unions and
wage increases are below the inflation rate.
(continued on page 4)
3
<PAGE> 6
FREMONT FUNDS
THE CHANGING FREMONT GLOBAL FUND ASSET MIX
<TABLE>
<CAPTION>
ASSET MIX ASSET MIX ASSET MIX
ASSET CLASS 4/30/97 10/31/96 10/31/95
<S> <C> <C> <C>
STOCKS
U.S. 43% 30% 35%
FOREIGN 22% 22% 35%
--- --- ---
TOTAL STOCKS 65% 52% 70%
--- --- ---
BONDS
U.S. 9% 6% 10%
FOREIGN 16% 16% 15%
--- --- ---
TOTAL BONDS 25% 22% 25%
--- --- ---
CASH RESERVES 10% 26% 5%
- ---------------------------------------------------------
TOTAL 100% 100% 100%
</TABLE>
We continue to shy away from Japan. The banking system remains fragile.
Budget deficits will constrain further government spending to stimulate the
economy and Japanese consumers are hamstrung from the recent sales tax increase
from 3% to 5%. We feel more positive about other Asian markets, in particular
Hong Kong, Singapore and the Philippines. Valuations are reasonable. For
example, Hong Kong stocks trade at just 16-times trailing earnings compared to
22-times earnings at the late 1993 market peak. With the Chinese economy
regaining momentum and the global semiconductor market recovering, these
economies should accelerate. We are underweighted in South Korea, where exports
are under pressure from the weak Japanese Yen, and in Thailand, where government
fiscal and monetary mismanagement and a property bubble spell more trouble.
On the international fixed-income front, we favor core-country European,
Canadian, and Australian bonds, all of which currently have very high "real"
rates of total return, (bond yields well in excess of inflation rates). We also
like dollar-denominated Latin American bonds. These economies are growing and
inflation rates are trending significantly lower. Latin American governments are
also instituting much more responsible fiscal and monetary policies.
Now that we've provided an overview of our current investment thinking, we
wanted to detail several securities that demonstrate our selection process. We
offer no guarantee these securities will be equally as attractive when you read
this report or that they will remain in the Fund portfolio. Currently, however,
they represent our kind of investment opportunity. In our last letter we talked
about several stocks. This time around, we thought we would include a bond
selection.
Argentina Brady bonds are Argentine government debt securities partially
collateralized by zero coupon U.S. Treasury Bonds--at maturity, the face value
of the U.S. Treasury zeros equals the face value of the Brady bond. Along with
most other Latin American debt, the Argentine Bradys got hit hard by the
"tequila effect" of Mexico's peso devaluation in 1994. However, over the last
year, as Argentina's economy has stabilized and inflation has subsided, the
bonds have performed spectacularly. In calendar 1996, the Argentine Brady bond
market was up 25.3%. We believe these bonds still represent great value. The
Argentine Bradys we own have a duration of 10.7 years and a current yield of
13.4%. Considering the fact that inflation in Argentina is running at about 2%,
this is a very attractive real rate of return. On a total return basis, our
Argentine Bradys are already up 5.6% calendar year-to-date 1997. We believe they
will continue to perform quite well going forward.
On the equities front, we'll mention Daimler-Benz, the German-based luxury
car manufacturer. The deutchmark's weakness against the dollar has made Mercedes
prices much more competitive in the big U.S. market. Mercedes has introduced a
popular new line including the M series sport utility vehicle and the SLK sports
car. In addition, Daimler-Benz has purged itself of four marginally profitable
divisions. We believe this will translate into 25% earnings gains in the next
year.
In closing, over the last six months, our faith in global stock and bond
markets has been rewarded. Although higher U.S. interest rates may cause
increased market volatility here and abroad, we expect global securities to
continue to trend higher over the next year. We remain confident the Fund will
continue to participate.
Sincerely,
/s/ Dave Redo
/s/ Robert Haddick
/s/ V.P. Kuhn
/s/ Pete Landini
/s/ Sandie Kinchen
The Fremont Asset Allocation Committee
Portfolio Managers, Fremont Global Fund
4
<PAGE> 7
FREMONT FUNDS
FREMONT INTERNATIONAL GROWTH FUND
Andrew L. Pang, Portfolio Manager
Fremont Investment Advisors, Inc.
[PHOTO ANDREW PANG]
Andrew Pang
FUND PROFILE
Fremont International Growth Fund invests in international stocks with superior
earnings growth potential. Approximately 40 percent of the portfolio is
generally invested in European stock markets, with the balance devoted to Asian
markets including Japan.
First, fund management employs a top-down approach--factoring in economic growth
potential, corporate earnings outlook, market valuations, political and currency
stability, and inflation and interest rate trends--to make country asset
allocation decisions. Then, within each country, the Fund focuses on those
industry groups providing essential products and services--consumer basics,
banking, telecommunications, information technology, power generation, health
care and infrastructure. In the stock selection process, the Fund favors
dominant market share companies (in some cases monopolies) most likely to
produce consistent earnings growth.
Portfolio Manager Andrew L. Pang is a Chinese American with strong cultural
ties and investment research contacts in Asia. He travels globally on a regular
basis, meeting with research analysts and directly with corporate managements to
identify investment opportunities.
TO OUR SHAREHOLDERS
For the six-month period ended April 30, 1997, the Fremont International
Growth Fund gained 4.14%, surpassing the Morgan Stanley Capital International
Europe, Australia, and Far East (EAFE) Index's 1.57% gain. Fund performance
benefited from underweighting in Japan (14% versus EAFE's 40%), where equities
continued to tread water. Our overweighting in a relatively strong Hong Kong
stock market (7.2% compared to EAFE's 3.5%) also worked to our advantage. The
biggest drag on Fund performance was the strong dollar. We do not hedge
currencies and consequently, strong gains from our European investments were
virtually cut in half when translated into dollar terms.
The biggest change in our investment strategy over the last six months was
increasing our allocation
(continued on page 6)
FREMONT INTERNATIONAL GROWTH FUND INVESTMENT RETURNS
<TABLE>
<CAPTION>
ANNUAL RETURNS
<S> <C>
3/1/94 -10/31/94* +2.30%
11/01/94-10/31/95 +0.13%
11/01/95-10/31/96 +7.07%
11/01/96- 4/30/97* +4.14%
AVERAGE ANNUAL +4.29% (SINCE INCEPTION)
</TABLE>
GROWTH OF $10,000+
AVERAGE ANNUAL RETURNS FOR
PERIODS ENDED 4/30/97
<TABLE>
<CAPTION>
1 3 SINCE INCEPTION
YEAR YEARS 3/1/94
<S> <C> <C>
-0.09% 5.72% 4.29%
</TABLE>
<TABLE>
<CAPTION>
FREMONT INT'L
GROWTH FUND EAFE
<S> <C> <C>
Mar 1, 94 10000 10000
Mar 31, 94 9634 9569
Apr 30, 94 9666 9975
May 31, 94 9676 9918
Jun 30, 94 9488 10058
Jul 31, 94 9718 10155
Aug 31, 94 10178 10395
Sep 30, 94 10031 10068
Oct 31, 94 10230 10403
Nov 30, 94 9739 9903
Dec 31, 94 9689 9965
Jan 31, 95 9020 9582
Feb 28, 95 9198 9555
Mar 31, 95 9386 10151
Apr 30, 95 9699 10533
May 31, 95 9950 10407
Jun 30, 95 10159 10225
Jul 31, 95 10734 10862
Aug 31, 95 10473 10448
Sep 30, 95 10546 10652
Oct 31, 95 10243 10366
Nov 30, 95 10148 10654
Dec 31, 95 10387 11083
Jan 31, 96 10746 11129
Feb 29, 96 10915 11166
Mar 31, 96 10999 11403
Apr 30, 96 11431 11735
May 31, 96 11326 11519
Jun 30, 96 11516 11584
Jul 31, 96 10915 11245
Aug 31, 96 11104 11270
Sep 30, 96 11368 11570
Oct 31, 96 10967 11454
Nov 30, 96 11516 11910
Dec 31, 96 11738 11757
Jan 31, 97 11749 11345
Feb 28, 97 11770 11531
Mar 31, 97 11527 11573
Apr 30, 97 11421 11634
</TABLE>
* Unannualized
+ Assumes initial investment of $10,000 on inception date, March 1, 1994.
Performance data illustrated is historical. Past performance is not
predictive of future performance. Share price and return will vary so that
a gain or loss may be realized when shares are sold. All performance
figures assume reinvestment of dividends. Management fees and other
expenses are included in the Fund's performance; however, fees and expenses
are not incorporated in the Morgan Stanley Capital International EAFE
Index.
5
<PAGE> 8
FREMONT FUNDS
FREMONT INTERNATIONAL GROWTH FUND
GEOGRAPHIC DIVERSIFICATION AS OF APRIL 30, 1997
[GLOBAL MAP GRAPHIC]
<TABLE>
<S> <C>
CANADA 0.2%
UNITED KINGDOM 7.4%
CONTINENTAL EUROPE 44.5%
UNITED STATES 5.3%
JAPAN 14.7%
HONG KONG/
SINGAPORE/MALAYSIA 18.2%
AUSTRALIA 2.8%
OTHER EMERGING MARKETS:
INCLUDING SOUTH KOREA,
INDONESIA, THE PHILIPPINES,
AND THAILAND 6.9%
</TABLE>
to European stocks from 39.4% at the beginning of this reporting period to its
current 52%. Our rationale was that with European economies gaining momentum and
most non-Japan Asian economies and stock markets restrained by higher U.S.
interest rates, a global slowdown in the semiconductor industry, and limited
liquidity (investment dollars stayed in the U.S. and Europe where returns have
been stronger in recent years), Europe offered more timely investment
opportunities. We were in the right place at the right time. However, as
previously mentioned, the strength of the dollar against major European
currencies took some of the wind out of our sails. On average, our investments
in the United Kingdom, France, Germany and Sweden were up 15-20% as measured in
local currencies, but just 5-10% when translated into dollar gains. With a
balanced budget agreement in the works and the Federal Reserve hinting that
further interest rate hikes may not be necessary, we believe the dollar has
plateaued versus the major European currencies. We expect the dollar to move
sideways to modestly lower over the next six months. Going forward, this should
help us get the full benefit from our European equity commitments.
We remain wary of Japan. The banking system is still fragile. Consumers
just got hit with an increase in the sales tax from 3% to 5%, and faced with
budget deficits, the government can't do much more economic pump priming. The
one bright spot is the big exporters who are benefiting from the weak Yen. Our
non-Japan Asian investments are concentrated in Singapore (7.0%), Hong Kong
(7.2%) and Malaysia (4.0%). All three markets are historically cheap. Singapore
stocks are trading at 19-times trailing earnings, Hong Kong at 16-times trailing
earnings and Malaysia at 17-times trailing earnings. This compares to P/Es in
the 22-35 range at the market peaks in late 1993. If, as we expect, U.S.
interest rates stabilize and the global semiconductor industry continues to
recover, these markets should gain momentum. Korea is still problematic due to
Japan's export pricing advantage resulting from the weak Yen. Thailand is cheap,
but will likely get cheaper until the real estate bubble bursts.
With our increased focus on Europe, we thought we would detail several of
the Fund's current European holdings. Be reminded, we are committed to no stock
forever and our opinions on the following may change without notice. SAP is a
German software
6
<PAGE> 9
FREMONT FUNDS
company with a truly global franchise including extensive operations in the U.S.
The big news for SAP and other leading software designers is the advent of the
year 2000, at which point virtually all computer software will have to be
updated to handle dates from the year 2000 on--one wonders why this wasn't
incorporated into software programs earlier. We are talking about billions of
dollars in software updates over the next several years. In addition, with
European Monetary Union and a new central European currency on the horizon,
there will be billions more in software upgrades. SAP will get its share of this
business and earnings should grow at an attractive rate for the foreseeable
future.
We also like Philips Electronics NV, the Netherlands-based consumer
electronics and semiconductor manufacturer. Philips' earnings should be
reinvigorated by the ongoing recovery in the semiconductor industry and better
profit margins resulting from its extensive cost-cutting program.
In closing, we thank you for your commitment to the Fund and will continue
to work diligently to enhance the assets you have entrusted to us.
Sincerely,
/s/ Andrew L. Pang
Andrew L. Pang
Portfolio Manager
Fremont International Growth Fund
FREMONT INTERNATIONAL GROWTH FUND
SECTOR ALLOCATION AS OF APRIL 30, 1997
<TABLE>
<S> <C>
SHORT TERM SECURITIES (5.5%)
OTHER (6.4%)
TECHNOLOGY (18.9%)
CONSUMER NON-DURABLES (2.4%)
CONSUMER SERVICES (3.5%)
HEALTH CARE (5.6%)
RAW MATERIALS (5.6%)
FINANCIAL SERVICES (15.6%)
CAPITAL GOODS (7.8%)
CONSUMER DURABLES (10.1%)
UTILITIES (9.1%)
MULTI-INDUSTRY (9.5%)
</TABLE>
7
<PAGE> 10
FREMONT FUNDS
FREMONT INTERNATIONAL SMALL CAP FUND
Dr. Gary L. Bergstrom, Portfolio Manager
Acadian Asset Management, Inc.
[PHOTO GARY BERGSTROM]
FUND PROFILE
Fremont International Small Cap Fund's investment thesis is simple: extensive
statistical evidence shows that superior long-term returns can be achieved by
investing in fundamentally undervalued small company stocks. The Fund's
Sub-Advisor, Acadian Asset Management, Inc., has a unique financial database of
approximately 20,000 companies in over 50 countries. This database includes up
to 25 years of historical earnings, dividends, book values, stock prices,
country indices, and inflation and interest rate statistics for individual
countries.
After screening stocks through numerous fundamental value models, country
and currency valuation is factored in, producing a relative attractiveness
ranking ("alpha ranking") for all the stocks in this extensive global universe.
The Fund invests in those highly ranked stocks judged to have above-average
performance potential. Country diversification is maintained to reduce portfolio
risk.
Portfolio Manager Dr. Gary L. Bergstrom, President and Chief Investment
Officer of the Fund's Sub-Advisor, Acadian Asset Management, Inc., has more than
25 years of professional investment experience in global markets. He has
personally developed many of the quantitative techniques employed in Acadian's
valuation models.
TO OUR SHAREHOLDERS
For the six months ended April 30, 1997, Fremont International Small Cap
Fund declined 2.28% compared to Salomon Brothers Extended Market Index of Europe
and Pacific Countries' (EMI-EPAC) 3.80% loss.
On the plus side of the ledger, the Fund's substantial commitment to the
emerging markets (currently, approximately 37% of the portfolio) helped bolster
returns. Our investments in Brazil, Greece and Turkey were particularly
productive as these markets soared. Our underweighting in Japan (presently
around 15% compared to EMI-EPAC's
FREMONT INTERNATIONAL SMALL CAP FUND INVESTMENT RETURNS
ANNUAL RETURNS
<TABLE>
<S> <C>
6/30/94- 10/31/94* -1.40%
11/01/94-10/31/95 -7.96%
11/01/95- 10/31/96 +13.69%
11/01/96- 4/30/97* -2.28%
AVERAGE ANNUAL +0.29% (SINCE INCEPTION)
</TABLE>
GROWTH OF $10,000+
AVERAGE ANNUAL RETURNS FOR
PERIODS ENDED 4/30/97
<TABLE>
<CAPTION>
1 2 SINCE INCEPTION
YEAR YEARS 6/30/94
<S> <C> <C>
- -3.51% 6.13% 0.29%
</TABLE>
FREMONT INTERNATIONAL SMALL CAP FUND
<TABLE>
<CAPTION>
EMI INDEX SOLOMON
<S> <C> <C>
Jun 30, 94 10,000 10,000
Jul 31, 94 10,130 10,114
Aug 31, 94 10,370 10,221
Sep 30, 94 9,920 9,929
Oct 31, 94 9,860 10,109
Nov 30, 94 9,310 9,478
Dec 31, 94 9,020 9,605
Jan 31, 95 8,540 9,293
Feb 28, 95 8,460 9,157
Mar 31, 95 8,650 9,546
Apr 30, 95 8,950 9,833
May 31, 95 9,180 9,660
Jun 30, 95 9,090 9,542
Jul 31, 95 9,600 10,098
Aug 31, 95 9,390 9,842
Sep 30, 95 9,430 9,919
Oct 31, 95 9,075 9,634
Nov 30, 95 9,004 9,736
Dec 31, 95 9,270 10,109
Jan 31, 96 9,870 10,288
Feb 29, 96 10,043 10,449
Mar 31, 96 10,236 10,689
Apr 30, 96 10,450 11,252
May 31, 96 10,460 11,160
Jun 30, 96 10,338 11,162
Jul 31, 96 10,043 10,740
Aug 31, 96 10,165 10,848
Sep 30, 96 10,216 10,909
Oct 31, 96 10,317 10,866
Nov 30, 96 10,480 11,045
Dec 31, 96 10,396 10,841
Jan 31, 97 10,449 10,607
Feb 28, 97 10,731 10,785
Mar 31, 97 10,334 10,642
Apr 30, 97 10,082 10,483
</TABLE>
* Unannualized
+ Assumes initial investment of $10,000 on inception date, June 30, 1994.
Performance data illustrated is historical. Past performance is not
predictive of future performance. Share price and return will vary so that
a gain or loss may be realized when shares are sold. All performance
figures assume reinvestment of dividends. Management fees and other
expenses are included in the Fund's performance; however, fees and expenses
are not incorporated in the Salomon Brothers Extended Market Index.
8
<PAGE> 11
FREMONT FUNDS
FREMONT INTERNATIONAL SMALL CAP FUND
GEOGRAPHIC DIVERSIFICATION AS OF APRIL 30, 1997
[GLOBAL MAP GRAPHIC]
<TABLE>
<S> <C>
CANADA 3.6%
IRELAND 1.1%
CONTINENTAL EUROPE 12.1%
UNITED STATES 0.8%
JAPAN 15.1%
UNITED KINGDOM 8.7%
HONG KONG/
SINGAPORE/MALAYSIA 14.1%
EMERGING MARKETS:
LATIN AMERICA 10.3%
OTHER EMERGING MARKETS:
INCLUDING SOUTH KOREA,
THAILAND, PORTUGAL,
GREECE, CZECH REPUBLIC,
CHINA AND OTHERS 26.9%
AUSTRALIA/
NEW ZEALAND 7.3%
</TABLE>
26%) was positive for relative returns, but still a major negative for absolute
returns as small cap Japanese stocks continued to suffer from a weak economy and
stock market.
We are pleased to have once again outperformed our benchmark index, but are
disappointed by the decline in the Fund's net asset value over the last six
months. As has been the case for most of the last 6 1/2 years, international
small cap equities materially lagged international large cap stocks and the U.S.
equities markets. The critical question is just how much longer will
international small cap stocks underperform other asset classes.
Despite the fact that small cap stocks have historically outperformed large
cap stocks in the U.S. and internationally, it is not unusual to see extended
periods of underperformance. Small caps generally make up the difference during
relatively shorter periods of dramatic outperformance. Wall Street research and
our own extensive studies of small cap/large cap performance trends reveal that
small cap stocks tend to perform better during periods of more rapid economic
expansion. With Japan and developed European economies mired in recession and/or
experiencing very sluggish recoveries since 1991, international small cap stocks
have languished. We believe this is about to change. In its semi-annual World
Economic Outlook, the International Monetary Fund is forecasting world economic
growth of 4.4% in 1997 and 1998, which would be its strongest showing in ten
years. More importantly to us, much of this economic momentum is projected to
come from continental Europe, Japan, and the emerging market nations. If these
forecasts prove accurate, we will see the kind of economic backdrop that has
historically favored international small cap stocks.
As the portfolio valuations and yields chart on the following page reveals,
international small cap equities and emerging market equities are fundamentally
attractive relative to international large cap stocks.
Looking ahead, we remain very positive in our outlook for the world's
developed equities markets, most of which are experiencing a highly favorable
economic environment characterized by moderate growth, low interest rates, and
low inflation. On a relative attractiveness basis, our models smile upon Hong
Kong, Australia, Austria, Finland, New Zealand and Canada. Japan is ranked
rather poorly, but we do see opportunities in a broad range of attractively
valued stocks. In the emerging market sector our models give strong rankings to
Colombia, Thailand, Brazil and Sri Lanka, and relatively low rankings to
(continued on page 10)
9
<PAGE> 12
FREMONT FUNDS
PORTFOLIO VALUATIONS AND YIELDS
<TABLE>
<CAPTION>
PRICE/ PRICE/ CURRENT NEXT YEAR PRICE/CASH
BOOK SALES P/E P/E EARNINGS YIELD
---- ----- --- --- -------- -----
<S> <C> <C> <C> <C> <C> <C>
EAFE 2.4 0.9 21.0 18.2 9.8 2.1%
EMI-EPAC 1.9 0.7 19.4 16.1 9.4 2.1%
IFC INVESTABLE 1.9 1.5 14.5 11.8 8.4 1.9%
FREMONT 1.0 0.3 10.7 8.8 5.3 4.0%
</TABLE>
Argentina, Malaysia and Taiwan. Brazil in particular continues to be one of the
world's most compelling investment opportunities, combining low current
valuations with a highly favorable economic outlook. We continue to overweight
the emerging market sector. The combination of more robust economic growth and
lower fundamental valuations relative to the developed nations, bolster emerging
markets' return potential. In addition, with emerging markets equities
performance improving over the last year, it may attract more money from U.S.
investors looking to further diversify their portfolios.
The relative attractiveness rankings of individual countries is an
important element in our methodology. However, stock selection is even more
critical to our investment discipline. With the caveat that things can change in
a hurry and that the companies we are writing about today may or may not be
timely investments by the time you read this, the following stocks demonstrate
the kind of fundamental prospects we favor.
Ence is a Spanish paper and packaging manufacturer currently selling at a
material discount to its peers. The weak peseta makes Ence very competitive in
Southern Europe. The company has strong forestry reserves and cost-effective
plans to import timber from Latin America. It also enjoys low labor and overhead
costs. Paper and packaging is a cyclical industry, which has been depressed due
to anemic economic growth in Europe. With European economies poised to regain
momentum in 1997-98, Ence's sales and earnings should improve substantially.
Tipco Asphalt is the leading asphalt manufacturer and paving contractor in
Thailand with 85% of the domestic market. The Thai government is planning to
pave 25,000 miles of road over the next 4 years. The stock has been knocked down
to a very attractive fundamental level largely due to the general malaise of the
Thai stock market. In our opinion, it is selling much too cheaply for a dominant
market share provider in a high-growth infrastructure industry.
The National Bank of Canada Montreal is positioned to be the leading bank
in Quebec. It has a strong balance sheet and dividends have been trending up.
Yet, we were initially able to buy the stock below book value. The stock is
still quite cheap on a price/earnings ratio and dividend yield basis. We see
National Bank of Canada Montreal as an ideal way to participate in a very
healthy Canadian economy and stock market.
In closing, we believe we are nearing the end of what has been an extended
period of underperformance relative to global large capitalization stocks. We
may now be entering the strongest period of synchronized global economic
expansion since World War II. European and Asian economies are expected to lead
the way. After adjusting for the speculative excesses reached at early 1994
peaks, emerging market equities are quite attractively priced considering
above-world-average economic growth prospects. We can't tell you precisely when
international small cap stocks will turn around. We can tell you that leading
economists are forecasting the kind of robust global economic growth that has
historically favored small cap stocks and that in view of current valuations,
the rally could be an exciting and rewarding one.
We thank you for your patience and appreciation of our investment efforts.
Be assured we will continue to practice our highly disciplined value approach to
the international small cap equities markets.
Sincerely,
/s/ Gary L. Bergstrom
Dr. Gary L. Bergstrom
Portfolio Manager
Fremont International Small Cap Fund
10
<PAGE> 13
FREMONT FUNDS
FREMONT EMERGING MARKETS FUND
Henry L. Thornton, Portfolio Manager
Credit Lyonnais International Asset Management (HK) Limited
[PHOTO HENRY THORNTON]
Henry Thornton
FUND PROFILE
Around the globe, countries that once relied on agriculture, natural resources
or low-level manufacturing are developing sophisticated, high-growth,
export-driven industrial economies. These emerging market countries offer a
wealth of opportunity for experienced professional investors.
Fremont Emerging Markets Fund employs a bottom-up stock picking approach to
build a diversified portfolio of emerging market companies. The Fund focuses on
the stocks of companies with rapid, sustainable earnings growth trading at
reasonable market valuations. Portfolio risk is further reduced by country
diversification. Fund management establishes a country allocation policy and
each regional investment team conducts rigorous fundamental research, including
company visits, to select individual stocks within each market. Liquidity is
also carefully monitored.
Portfolio Manager Henry Thornton, Investment Director of Sub-Advisor Credit
Lyonnais International Asset Management (CLIAM), is widely recognized as an
expert in emerging market investing. Headquartered in London, with offices in
Hong Kong and Singapore, CLIAM's experienced team of analysts is geographically
well-positioned for "hands-on" emerging market research.
TO OUR SHAREHOLDERS
For the six months ended April 30, 1997, the Fremont Emerging Markets Fund
returned 16.42% compared to the Morgan Stanley Capital International Emerging
Markets Free (MSCI-EMF) Index's 10.98% and the IFC Investable Index's 9.74%
gains.
In Asia, the Fund's investments in Hong Kong, China, Taiwan and Indonesia
were quite productive. Our holdings in Thailand disappointed as this market fell
sharply. The Fund's exposure in Latin America, particularly Brazil,
significantly enhanced performance.
Currently, 48.7% of the portfolio is in Asia, 27.8% is in Latin America,
4.5% is in Eastern Europe/Mid-
(continued on page 12)
FREMONT EMERGING MARKETS FUND INVESTMENT RETURNS
RETURNS
<TABLE>
<S> <C>
6/24/96- 10/31/96* -3.12%
11/1/96- 4/30/97* +16.42%
+12.79%* (SINCE INCEPTION)
</TABLE>
GROWTH OF $10,000+
RETURN FOR
PERIOD ENDED 4/30/97*
SINCE INCEPTION
6/24/96
12.79%
FREMONT EMERGING MARKETS FUND
<TABLE>
<CAPTION>
Markets Free MSCI Emerging
<S> <C> <C>
Jun 30, 96 10000 10000
Jul 31, 96 9560 9317
Aug 31, 96 9760 9555
Sep 30, 96 9920 9638
Oct 31, 96 9688 9381
Nov 30, 96 9920 9538
Dec 31, 96 9901 9581
Jan 31, 97 10803 10235
Feb 28, 97 11167 10673
Mar 31, 97 10995 10393
Apr 30, 97 11279 10411
</TABLE>
* Unannualized
+ Assumes initial investment of $10,000 on inception date, June 24, 1996.
Performance data illustrated is historical. Past performance is not
predictive of future performance. Share price and return will vary so that
a gain or loss may be realized when shares are sold. All performance
figures assume reinvestment of dividends. Management fees and other
expenses are included in the Fund's performance; however, fees and expenses
are not incorporated in the MSCI Emerging Markets Free Index.
11
<PAGE> 14
FREMONT FUNDS
FREMONT EMERGING MARKETS FUND
GEOGRAPHIC DIVERSIFICATION AS OF APRIL 30, 1997
[GLOBAL MAP GRAPHIC]
<TABLE>
<S> <C>
UNITED STATES 19.0%
PACIFIC RIM:
INCLUDING HONG KONG,
MALAYSIA, AND TAIWAN 34.5%
LATIN AMERICA 27.8%
EMERGING MARKETS:
INCLUDING INDONESIA, INDIA,
TURKEY, THE PHILIPPINES,
RUSSIA, CHINA, SOUTH AFRICA
AND THAILAND 18.7%
</TABLE>
East/South Africa, and we are holding 19.0% in cash. Due to our extensive
research resources in the Pacific Rim, we anticipate the Fund will generally
have a heavier weighting in Asia. We like Hong Kong/China equities, but have
been unable to find a sufficient number of good investment opportunities in
other Asian markets like South Korea, Thailand and the Philippines. Over the
last six months, we have found it more prudent and rewarding to invest a large
percentage of the Fund's cash inflow into Latin America where strong economic
growth and the ongoing privatization of utilities and other essential
infrastructure companies has created very appealing opportunities. Our
investment in Brazil's Telebras, a utility holding company is a good example.
Over the last six months, the stock has gone from $75 to $115. We estimate the
current economic value of the company at around $150 per share. This value and
Telebras stock price should continue to grow as further privatization of the
company's utilities holdings takes place.
In Asia, our investments are concentrated in Hong Kong, Taiwan and
Indonesia, which together represent approximately 35% of the Fund's assets. Most
of the balance of our Asian commitments is in Malaysia and India. In particular,
we favor India, whose economy is emerging from recession. We have been quite
cautious in the Asian markets because the strength of the dollar against the Yen
and major European currencies have put Asian companies that sell into these
markets at a competitive price disadvantage. Our goal has been to find companies
that are lowering their manufacturing costs significantly enough to price their
products competitively without sacrificing profit margins. We are also focusing
on "China concept" companies that should benefit from the current economic
recovery in China. These opportunities come in the form of H shares
(Chinese-based companies listed on the Hong Kong stock market), the so-called
"Red Chips" (Hong Kong and Taiwan-based companies doing most of their business
in China), and the B shares of Chinese companies that foreigners are allowed to
own.
Although the Thai and Korean markets are fundamentally cheap, we suspect
they may remain so for the foreseeable future. Thai and Korean companies
continue to lose world market share to their Japanese competitors. Many of these
companies are
12
<PAGE> 15
FREMONT FUNDS
highly leveraged and with both these economies weakening, we could see a number
of high profile bankruptcies.
We will continue to be very selective in Eastern European markets. Our
limited number of investments in these markets has worked out relatively well
to-date. We are still wary, however, of the perilous transition these countries
are making to free market economies, and of their unseasoned, highly volatile
stock markets.
While there is no guarantee the Fund will still own the following stocks by
the time this report is published, we did want to profile a few of the current
portfolio holdings that demonstrate our investment discipline. Indonesia's Daya
Guna Samudera is a fishing company with a modern fleet of 370 trawlers and a
terrific concession area in the Arafura Sea. We had the good fortune of visiting
the company the day before it came public. The stock was priced at 8-times
earnings, a multiple that was comparable to several publicly traded aqua-culture
(fish farming) companies. Daya Guna Samudera is a much better growth story. It
is a well-managed, financially sound company that is expanding its fleet in very
fertile fishing grounds. Despite nearly doubling since listing, the stock is
currently trading at an undemanding 9-times 1998 earnings estimates.
Taiwan's Hon Hai Precision makes computer connective devices. This is a
globally-competitive business with limited pricing flexibility. The long-term
winners will be the low-cost producers. Hon Hai is rapidly moving its
manufacturing capacity from Taiwan to mainland China and in the process,
realizing enormous cost savings. Earnings were up 50% last year and sales are up
118% year-to-date. We don't expect to see such dramatic sales and earnings gains
going forward, but we believe 30% annual earnings growth is achievable over the
next several years. Hon Hai stock is currently trading around 25-times historic
earnings--not a raging fundamental bargain, but still a more-than-reasonable
multiple considering the company's superior earnings growth prospects.
In closing, we thank all of you for your investment in the Fund. Our assets
have grown from $3.8 million on October 31, 1996, to more than $8 million as we
write. We have been investing the cash in our careful disciplined manner and
expect to be more fully invested as fundamentally attractive opportunities
present themselves. We believe the emerging markets will live up to their
long-term potential promise and that our "growth-at-a-reasonable-price" approach
will remain productive.
Sincerely,
/s/ Henry Thornton
Henry Thornton
Portfolio Manager
Fremont Emerging Markets Fund
13
<PAGE> 16
FREMONT FUNDS
FREMONT U.S. MICRO-CAP FUND
Robert E. Kern, Portfolio Manager
Fremont Investment Advisors, Inc.
[PHOTO ROBERT E. KERN]
Robert E. Kern
FUND PROFILE
The U.S. micro-cap stock market (stocks with market capitalizations in the
bottom 5% of the equities market) is a breeding ground for entrepreneurially
managed companies with exceptional growth prospects. With minimal Wall Street
research coverage and low institutional ownership, micro-cap stocks represent
the least efficient sector of the domestic equities market. This inefficiency
creates attractive investment opportunities for the research-driven stock
pickers managing the Fremont U.S. Micro-Cap Fund.
Since the investment potential of micro-cap stocks is largely determined by
the business prospects for individual companies rather than macroeconomic
trends, the Fund's focus is on bottom-up stock selection. Fund management
analyzes financial statements, the company's competitive position, and meets
with key corporate decision makers to discuss strategies for future growth. The
Fund's goal is to find "winners" early in their growth cycle and, importantly,
to minimize fundamental investment mistakes.
Successful micro-cap investing also involves minimizing transaction costs.
The Fund's dedicated trader works hand-in-hand with the portfolio management
team on execution strategies to enhance the Fund's performance.
Robert E. Kern is nationally recognized as a pioneer and leading
practitioner of micro-cap research and portfolio management.
TO OUR SHAREHOLDERS
For the six months ended April 30, 1997, the Fremont U.S. Micro-Cap Fund
returned 0.55% compared to the Russell 2000's 1.61%. Small stocks in general
underperformed large cap equities, and small cap growth stocks dramatically
underperformed small cap value stocks--as is evidenced by the Russell 2000
Growth Index's 7.29% loss versus the Russell 2000 Value Index's 10.12% gain.
Our portfolio performed well on an absolute and
FREMONT U.S. MICRO-CAP FUND INVESTMENT RETURNS
ANNUAL RETURNS
<TABLE>
<S> <C>
6/30/94-10/31/94* +3.60%
11/01/94-10/31/95 +38.68%
11/01/95-10/31/96 +41.46%
11/01/96- 4/30/97* +0.55%
AVERAGE ANNUAL +28.69% (SINCE INCEPTION)
</TABLE>
GROWTH OF $10,000+
AVERAGE ANNUAL RETURNS FOR
PERIODS ENDED 4/30/97
<TABLE>
<CAPTION>
1 2 SINCE INCEPTION
YEAR YEARS 6/30/94
<S> <C> <C>
3.02% 33.91% 28.69%
</TABLE>
<TABLE>
<CAPTION>
FREMONT U.S. RUSSELL
MICRO-CAP FUND 2000 INDEX
<S> <C> <C>
Jun 30, 94 10000 10000
Jul 31, 94 10220 10164
Aug 31, 94 10320 10730
Sep 30, 94 10470 10694
Oct 31, 94 10360 10651
Nov 30, 94 10000 10221
Dec 31, 94 10150 10494
Jan 31, 95 10350 10362
Feb 28, 95 10671 10793
Mar 31, 95 11122 10978
Apr 30, 95 11392 11222
May 31, 95 11913 11415
Jun 30, 95 12495 12007
Jul 31, 95 13346 12699
Aug 31, 95 14188 12961
Sep 30, 95 14549 13193
Oct 31, 95 14368 12602
Nov 30, 95 15020 13132
Dec 31, 95 15635 13479
Jan 31, 96 16174 13465
Feb 29, 96 17250 13884
Mar 31, 96 17810 14167
Apr 30, 96 19839 14925
May 31, 96 21506 15513
Jun 30, 96 20699 14876
Jul 31, 96 18897 13577
Aug 31, 96 20057 14365
Sep 30, 96 21009 14926
Oct 31, 96 20326 14696
Nov 30, 96 21755 15302
Dec 31, 96 23250 15701
Jan 31, 97 24428 16015
Feb 28, 97 23012 15626
Mar 31, 97 21011 14889
Apr 30, 97 20438 14930
</TABLE>
* Unannualized
+ Assumes initial investment of $10,000 on inception date, June 30, 1994.
Performance data illustrated is historical. Past performance is not
predictive of future performance. Share price and return will vary so that
a gain or loss may be realized when shares are sold. All performance
figures assume reinvestment of dividends. Management fees and other
expenses are included in the Fund's performance; however, fees and expenses
are not incorporated in the Russell 2000 Index.
14
<PAGE> 17
FREMONT FUNDS
relative basis during November, December and January, and underperformed when
small cap growth stocks hit the skids in February. As is often the case during
periods of extreme volatility in the equities markets, those companies that
exceeded earnings expectations performed very well and those that disappointed
even modestly were punished severely.
In late April and the first few weeks in May, small growth stocks rebounded
vigorously largely due to investors' more favorable attitude to the group and
short covering in the aggressive growth stock sector. We don't know whether this
rally will continue, but for the time being, we are once again enjoying a more
level playing field on which to practice our bottom-up stock picking discipline.
Although the market may remain highly sensitive to macroeconomic and
interest rate trends, the fundamental prospects for most micro-cap companies are
far more dependent on internal dynamics such as product development, new
services, and expanding distribution channels. These are the elements we
continue to focus on in researching micro-cap investment opportunities.
In each report, we like to discuss a portfolio company that demonstrates
our investment discipline. Please be aware we reserve the right to change our
opinion on any stock in the portfolio if fundamentally warranted. This duly
noted, one of our current favorites is Mobile Data Solutions, ticker symbol
MDSIF. The company is the leading worldwide systems provider for automating
mobile field service crews in the utilities, telecommunications and taxi
dispatch industries. In the bad old days, central maintenance and repair offices
couldn't effectively track where their crews were, had no idea of the status of
each job, and therefore, no efficient system for scheduling future work.
Utilizing wireless communications, the global positioning system, and low cost
portable computers, Mobile Data Solutions addresses all of these problems. By
materially enhancing the productivity of maintenance and repair crews, Mobile
Data Solutions can easily justify the cost of its systems. Mobile Data has done
a good job selling its services to the electric utilities industry. Going
forward, there are excellent growth opportunities in the recently deregulated
telecommunications industry, in which the impending loss of monopoly status
mandates productivity improvement. As this market develops further, Mobile Data
Solutions is expected to achieve strong earnings growth and greater investor
recognition.
Although the overwhelming majority of the portfolio is dedicated to still
quite small, but established companies, the Fund does make investments in a few
developmental stage companies with exceptional growth prospects. Because there
isn't a significant track record, researching these companies requires a
somewhat different approach, e.g., in addition to discussing business strategies
with top management, there is a special focus on strategic partnering
arrangements. Aware, ticker symbol AWRE, is a leader in developing new high
bandwidth technologies for internet access and data and video transmission over
the "last mile" of copper wire to homes and businesses. Aware is partnered with
Analog Devices on the semiconductor front, and leading communications equipment
companies, including Ascend Communications, DSC Communications, and U.S.
Robotics, the leading supplier of modems. If Aware's technology becomes an
industry standard, its growth prospects are extraordinary.
In the Fremont Funds Annual Report published last December, we told you,
"We can't promise we'll deliver 40% plus returns every year." Unless we have one
terrific fiscal second half 1997, our returns will be more modest than the
Fund's returns in each of the last two fiscal years. Over the years, we have
been through many ups and downs in the market, and we have every confidence our
intensive research efforts, and focused portfolio management and trading
strategies will deliver superior long-term investment returns.
Sincerely,
/s/ Robert E. Kern
Robert E. Kern
Portfolio Manager
Fremont U.S. Micro-Cap Fund
15
<PAGE> 18
FREMONT FUNDS
FREMONT GROWTH FUND
W. Kent Copa, CFA, Portfolio Manager
Fremont Investment Advisors, Inc.
[PHOTO KEN COPA]
Ken Copa
FUND PROFILE
Fremont Growth Fund invests principally in large capitalization U.S. stocks with
superior earnings growth prospects. The goal is to consistently outperform the
Standard & Poor's 500 Index (S&P 500). Extensive statistical evidence reveals a
direct relationship between the performance of stocks in selected industry
groups during the varying stages of the economic cycle. For example, food and
drug stocks, which generally produce consistent earnings growth throughout the
business cycle, tend to perform well in a sluggish economy. Auto, energy, and
banking company earnings and stock prices tend to grow faster when the economy
gains momentum.
Fremont Growth Fund utilizes sophisticated quantitative models to forecast
macro-economic trends and to identify those industry groups providing the best
relative investment potential. The stock selection process involves identifying
leading companies in each industry group with consistent earnings growth records
and reasonable valuations.
This "sector rotation" style is widely utilized by large institutional
investors. Fremont Growth Fund offers this sophisticated investment discipline
to mutual fund shareholders.
TO OUR SHAREHOLDERS
For the six month period ended April 30, 1997, the Fremont Growth Fund
returned 11.13% compared to the S&P 500 Index's 14.72%. In a period in which few
active managers matched the S&P 500 benchmark, the Fremont Growth Fund's gain
materially exceeded the 6.98% advance for the Lipper Growth Fund Average.
The Fund benefited from its overweighting in financial services--at 21.4%,
our largest industry group commitment. Our financial services component return
was 21.19% compared with the S&P 500's financial component's 18.17% gain,
reflecting well on our quantitative stock picking discipline. Our technology
group investments, which were modestly underweighted (currently 13.1% versus the
index's 13.6%), also performed well returning
FREMONT GROWTH FUND INVESTMENT RETURNS
ANNUAL RETURNS
<TABLE>
<S> <C>
8/14/92-10/31/92* +2.00%
11/01/92-10/31/93 +12.80%
11/01/94-10/31/95 +1.72%
11/01/93-10/31/94 +28.12%
11/01/95-10/31/96 +22.06%
11/01/96- 4/30/97* +11.13%
AVERAGE ANNUAL +16.27% (SINCE INCEPTION)
</TABLE>
GROWTH OF $10,000+
AVERAGE ANNUAL RETURNS FOR
PERIODS ENDED 4/30/97
<TABLE>
<CAPTION>
1 3 SINCE INCEPTION
YEAR YEARS 8/14/92
<S> <C> <C>
23.15% 22.54% 16.27%
</TABLE>
<TABLE>
<CAPTION>
Date Growth Fund S&P 500 Index
<S> <C> <C>
Aug 14, 92 10000 10000
Aug 31, 92 9899 9873
Sep 30, 92 10091 9987
Oct 31, 92 10200 10023
Nov 30, 92 10655 10361
Dec 31, 92 10822 10495
Jan 31, 93 10954 10572
Feb 28, 93 10843 10716
Mar 31, 93 11005 10947
Apr 30, 93 10609 10679
May 31, 93 10863 10964
Jun 30, 93 10945 11000
Jul 31, 93 10935 10946
Aug 31, 93 11302 11359
Sep 30, 93 11414 11276
Oct 31, 93 11506 11507
Nov 30, 93 11270 11404
Dec 31, 93 11516 11544
Jan 31, 94 11907 11932
Feb 28, 94 11536 11608
Mar 31, 94 10929 11104
Apr 30, 94 11052 11248
May 31, 94 11093 11432
Jun 30, 94 10722 11149
Jul 31, 94 11155 11518
Aug 31, 94 11724 11986
Sep 30, 94 11476 11696
Oct 31, 94 11704 11965
Nov 30, 94 11335 11526
Dec 31, 94 11563 11695
Jan 31, 95 11609 11998
Feb 28, 95 11987 12463
Mar 31, 95 12307 12832
Apr 30, 95 12570 13210
May 31, 95 12982 13733
Jun 30, 95 13622 14056
Jul 31, 95 14228 14524
Aug 31, 95 14423 14558
Sep 30, 95 14983 15164
Oct 31, 95 14995 15122
Nov 30, 95 15477 15787
Dec 31, 95 15449 16079
Jan 31, 96 15898 16633
Feb 29, 96 16092 16793
Mar 31, 96 16032 16954
Apr 30, 96 16517 17204
May 31, 96 17087 17647
Jun 30, 96 17184 17714
Jul 31, 96 16347 16932
Aug 31, 96 16638 17289
Sep 30, 96 17852 18262
Oct 31, 96 18308 18766
Nov 30, 96 19631 20184
Dec 31, 96 19326 19784
Jan 31, 97 20204 21020
Feb 28, 97 20326 21185
Mar 31, 97 19614 20315
Apr 30, 97 20341 21527
</TABLE>
* Unannualized
+ Assumes initial investment of $10,000 on inception date, August 14, 1992.
Performance data illustrated is historical. Past performance is not
predictive of future performance. Share price and return will vary so that
a gain or loss may be realized when shares are sold. All performance
figures assume reinvestment of dividends. Management fees and other
expenses are included in the Fund's performance; however, fees and expenses
are not incorporated in the S&P 500 Index.
16
<PAGE> 19
FREMONT FUNDS
FREMONT GROWTH FUND
SECTOR DIVERSIFICATION AS OF APRIL 30, 1997
<TABLE>
<S> <C>
SHORT TERM SECURITIES (5.6%)
FINANCIAL SERVICES (21.4%)
OTHER (16.8%)
TRANSPORTATION (3.9%)
RETAIL (4.3%)
ENERGY (16.3%)
HEALTH CARE (5.5%)
TECHNOLOGY (13.1%)
UTILITIES (13.1%)
</TABLE>
24.78% compared to the S&P 500 technology component's 24.01% gain. Our
overweighting in the energy group (16.3% allocation versus the S&P's
9.3%), was a major negative as energy sector returns lagged the index.
Looking ahead, we plan to maintain our overweighting in financial services
and energy. Within the financial services sector, we will likely reduce our
exposure to bank stocks, which may struggle in the face of higher interest
rates, and increase our positions in insurance companies and stock
brokerage/asset management companies, which should continue to benefit from
strong economic growth and demographic trends that favor increased savings and
investment. Although disappointed in energy sector returns over the last six
months, more vigorous economic growth in Europe, Asia, and the emerging market
nations should stimulate demand for oil and improve energy company earnings.
With the caveat that these stocks may be more or less attractive at the
time you read this report, we will mention two of our current favorites in these
industry groups. Travelers Group is one of the most diversified firms in the
financial services industry, with strong life, property and casualty insurance
divisions, and Smith Barney, its large stock brokerage/investment management
subsidiary. Travelers has an excellent earnings record, and in our opinion,
outstanding earnings growth prospects over the next several years. In the energy
sector, Mobil continues to be one of our favorites. The company is well on its
way to achieving all of management's earnings and return-on-equities goals.
In closing, we are pleased to have outperformed most of our competitors in
the growth fund universe. As always, we will be carefully monitoring
macroeconomic trends and enhancing our sector and stock selections so that we
can continue to outperform.
Sincerely,
/s/ Ken Copa
W. Kent Copa
Portfolio Manager
Fremont Growth Fund
17
<PAGE> 20
FREMONT FUNDS
FREMONT BOND FUND
Bill Gross, Founder and Managing Director
Pacific Investment Management Company (PIMCO)
[PHOTO BILL GROSS]
Fremont Bond Fund invests in high quality corporate, mortgage-backed, hedged
international, and government bonds. The Fund's goal is to consistently provide
attractive risk-adjusted returns relative to the broad fixed-income market.
FUND PROFILE
The Fund's investment philosophy embodies three key principles. First,
portfolio strategy is driven by longer-term trends in interest rates. Three- to
five-year economic, demographic, and political forecasts are updated annually to
identify the long term interest rate trend, which determines the most
appropriate maturity/duration (interest rate sensitivity) range for the
portfolio. Second, consistent performance is achieved by avoiding extreme swings
in portfolio maturity/duration. By operating within a moderate duration range
relative to the broad fixed-income market, the Fund limits downside risk during
short-lived, but periodically violent interest rate fluctuations. Finally,
emphasis is placed on adding value through the analysis of traditional variables
such as sector, coupon, and quality.
Portfolio Manager Bill Gross, Founder and Managing Director of Pacific
Investment Management Company (PIMCO), has 26 years of professional fixed-income
investment experience. In addition to serving as the sub-advisor to the Fremont
Bond Fund, PIMCO manages $92 billion in fixed income investments for
institutional clients.
TO OUR SHAREHOLDERS
For the six months ended April 30, 1997, the Fremont Bond Fund returned
2.26% versus 1.70% for the Lehman Brothers Aggregate Bond Index. While the
overall impact of portfolio management decisions was clearly positive, the
performance impact of specific strategies was mixed. Our interest rate
strategies (duration and maturity mix) detracted from relative performance. We
entered the period with an above-index duration target designed to capture price
gains in a falling interest rate environment. However, domestic growth surprised
on the upside, igniting inflation fears and driving Treasury yields up 30 to 55
basis points (0.30% to 0.55%). Our maturity mix, which was biased toward
intermediates,
FREMONT BOND FUND INVESTMENT RETURNS
ANNUAL RETURNS
<TABLE>
<S> <C>
4/30/93- 10/31/93* +5.15%
11/01/93-10/31/94 -4.42%
11/01/94-10/31/95 +16.49%
11/01/95-10/31/96 +8.18%
11/01/96-4/30/97* +2.26%
AVERAGE ANNUAL +6.68% (SINCE INCEPTION)
</TABLE>
AVERAGE ANNUAL RETURNS FOR
PERIODS ENDED 4/30/97
<TABLE>
<CAPTION>
1 3 SINCE INCEPTION
YEAR YEARS 4/30/93
<S> <C> <C>
9.38% 8.82% 6.68%
</TABLE>
<TABLE>
<CAPTION>
FREMONT LEHMAN BROS
BOND FUND AGGREGATE BOND INDEX
<S> <C> <C>
Apr 30, 93 10000 10000
May 31, 93 9963 10013
Jun 30, 93 10182 10194
Jul 31, 93 10198 10252
Aug 31, 93 10415 10432
Sep 30, 93 10481 10460
Oct 31, 93 10515 10499
Nov 30, 93 10366 10410
Dec 31, 93 10437 10466
Jan 31, 94 10585 10607
Feb 28, 94 10388 10423
Mar 31, 94 10147 10166
Apr 30, 94 10049 10085
May 31, 94 9959 10083
Jun 30, 94 10025 10061
Jul 31, 94 10205 10261
Aug 31, 94 10230 10274
Sep 30, 94 10106 10123
Oct 31, 94 10050 10114
Nov 30, 94 10020 10091
Dec 31, 94 10018 10161
Jan 31, 95 10242 10362
Feb 28, 95 10522 10609
Mar 31, 95 10621 10674
Apr 30, 95 10823 10823
May 31, 95 11228 11242
Jun 30, 95 11299 11324
Jul 31, 95 11263 11299
Aug 31, 95 11397 11436
Sep 30, 95 11530 11547
Oct 31, 95 11707 11697
Nov 30, 95 11954 11872
Dec 31, 95 12146 12038
Jan 31, 96 12269 12118
Feb 29, 96 11935 11907
Mar 31, 96 11893 11824
Apr 30, 96 11840 11757
May 31, 96 11765 11734
Jun 30, 96 11964 11891
Jul 31, 96 11973 11923
Aug 31, 96 11997 11903
Sep 30, 96 12313 12110
Oct 31, 96 12664 12379
Nov 30, 96 12878 12591
Dec 31, 96 12781 12474
Jan 31, 97 12801 12512
Feb 28, 97 12816 12543
Mar 31, 97 12698 12404
Apr 30, 97 12951 12590
</TABLE>
* Unannualized
+ Assumes initial investment of $10,000 on inception date, April 30, 1993.
Performance data illustrated is historical. Past performance is not
predictive of future performance. Share price and return will vary so that
a gain or loss may be realized when shares are sold. All performance
figures assume reinvestment of dividends. Management fees and other
expenses are included in the Fund's performance; however, fees and expenses
are not incorporated in the Lehman Bros. Aggregate Bond Index.
18
<PAGE> 21
FREMONT FUNDS
also detracted from performance as intermediate rates experienced the greatest
rise.
On the sector front, our emphasis on mortgage-back securities was a strong
contributor to our outperformance as the sector continued to post healthy
returns versus Treasuries. Our underweighting of the corporate sector detracted
from relative returns as yield spreads on investment-grade issues remained
tight. The best returns were again found in the below investment-grade sector.
The returns on our foreign bond positions varied by country but had little
overall impact on relative performance.
Looking ahead, our long-term view on interest rates remains bullish for
bonds. This view is based on a handful of prominent economic themes, such as the
competitive forces being unleashed by the globalization of markets for goods,
production and capital. With respect to the business cycle, the U.S. economy
remains on a firm growth path with sufficient momentum to expand for now above
the Fed's targeted 2-2.5% long-term pace. However, we do not necessarily
anticipate an associated pick-up in inflation. We believe that businesses lack
the power to pass higher input costs through to final prices in an increasingly
global, deregulated and competitive economy. Additionally, to the extent that
true productivity gains, particularly in the service sector, exceed official
measures, the economy can enjoy faster growth and fuller employment without
rising inflation. Nonetheless, we remain somewhat cautious in the short term.
We have therefore set our duration target at a modest 0.25 years above the
index, reflecting the combination of our bullish long-term views and near-term
caution. Our curve focus remains on intermediate maturities where yields exceed
those on comparable combinations of long- and short-maturity bonds.
On the sector front, we continue to favor mortgages. Despite their strong
performance to-date, mortgage-backed securities still offer relative value
versus other domestic fixed-income sectors. Corporate yield spreads over
Treasuries pose more risk of widening (which reduces relative price performance)
than promise of further tightening. We will thus remain underweighted to the
corporate sector in favor of mortgages. Our allocation to foreign markets will
not be a significant part of our sector allocation, as we continue to believe
that value within the global fixed-income markets resides predominantly within
the U.S. for the time being.
Sincerely,
/s/ Bill Gross
Bill Gross
Portfolio Manager
Fremont Bond Fund
PORTFOLIO CREDIT QUALITY OF FREMONT BOND FUND
AS OF APRIL 30, 1997
<TABLE>
<S> <C>
AA (1%)
AAA (84%)
BB (3%)
BBB (12%)
</TABLE>
19
<PAGE> 22
FREMONT FUNDS
FREMONT MONEY MARKET FUND
Norman Gee, Portfolio Manager
Fremont Investment Advisors, Inc.
[PHOTO NORMAN GEE]
Norman Gee
FUND PROFILE
Fremont Money Market Fund invests primarily in high-quality short-term debt
securities (commercial paper) issued by U.S. corporations and U.S. subsidiaries
of foreign corporations. The Fund will also take small positions in other
investment-grade short-term debt instruments such as Yankee CDs (dollar
denominated certificates of deposit in foreign banks).
Portfolio Manager Norman Gee strives to add value through price-sensitive
trading and by identifying undervalued high quality money market securities. He
will also make conservative adjustments to the portfolio's average maturity
relative to the market in attempting to enhance total portfolio yield.
TO OUR SHAREHOLDERS
For the six month period ended April 30, 1997, the Fremont Money Market
Fund returned 2.60% compared to the IBC Money Market First Tier Taxable
Average's 2.39%. We are pleased to report the Fund once again finished in the
top ten percent of comparable funds in the IBC money market fund universe.
In Fremont Funds' Annual Report dated October 31, 1996, we opined that
evidence of some inflationary pressure on the economy might motivate the Federal
Reserve to hike short-term interest rates by 50 basis points (0.5%) in second
half 1997. We anticipated reducing the Fund's average maturity in front of any
Fed action. We were right about a rate hike, but our timing was a little off. In
a preemptive strike against inflation, the Fed increased the Federal Funds rate
by 25 basis points (0.25%) in March. The Fund's higher-than-market-average
maturity, approximately 62 days versus 52 days, worked for us through February
and against us as rates moved higher in March. However, our strategy of
"barbelling" the portfolio--overweighting the longest and shortest maturities
and underweighting the middle maturities--allowed us to increase our lead over
the benchmark index in spite of rising short-term interest rates.
FREMONT MONEY MARKET FUND INVESTMENT RETURNS
ANNUAL RETURNS
<TABLE>
<S> <C>
11/18/88-10/31/89* +8.52%
11/01/89-10/31/90 +7.99%
11/01/90-10/31/91 +6.51%
11/01/91-10/31/92 +3.73%
11/01/92-10/31/93 +2.66%
11/01/93-10/31/94 +3.49%
11/01/95-10/31/96 +5.34%
11/01/94-10/31/95 +5.84%
11/01/96- 4/30/97* +2.60%
AVERAGE ANNUAL +5.51% (SINCE INCEPTION)
</TABLE>
GROWTH OF $10,000+
AVERAGE ANNUAL RETURNS FOR
PERIODS ENDED 4/30/97
<TABLE>
<CAPTION>
1 5 SINCE INCEPTION
YEAR YEARS 11/18/88
<S> <C> <C>
5.27% 4.31% 5.51%
</TABLE>
<TABLE>
<CAPTION>
DONOGHUE
FREMONT FIRST TIER
MONEY MARKET 90 DAY TAXABLE
FUND US T-BILLS PRIME AVG.
<S> <C> <C> <C>
Nov 18, 88 10000 10000 10000
Nov 30, 88 10027 10026 10025
Dec 31, 88 10096 10093 10090
Jan 31, 89 10170 10163 10159
Feb 28, 89 10237 10236 10228
Mar 31, 89 10315 10311 10300
Apr 30, 89 10389 10383 10377
May 31, 89 10475 10457 10452
Jun 30, 89 10552 10526 10528
Jul 31, 89 10630 10592 10600
Aug 31, 89 10705 10661 10670
Sep 30, 89 10775 10731 10741
Oct 31, 89 10852 10813 10812
Nov 30, 89 10924 10887 10881
Dec 31, 89 10993 10955 10949
Jan 31, 90 11067 11027 11017
Feb 28, 90 11132 11093 11084
Mar 31, 90 11202 11168 11152
Apr 30, 90 11276 11240 11221
May 31, 90 11350 11317 11291
Jun 30, 90 11420 11390 11360
Jul 31, 90 11498 11465 11429
Aug 31, 90 11573 11540 11498
Sep 30, 90 11640 11610 11567
Oct 31, 90 11719 11682 11636
Nov 30, 90 11792 11751 11704
Dec 31, 90 11867 11821 11773
Jan 31, 91 11941 11888 11839
Feb 28, 91 12005 11946 11901
Mar 31, 91 12065 12008 11959
Apr 30, 91 12134 12066 12015
May 31, 91 12195 12124 12068
Jun 30, 91 12249 12180 12121
Jul 31, 91 12312 12238 12174
Aug 31, 91 12369 12296 12227
Sep 30, 91 12426 12350 12278
Oct 31, 91 12482 12404 12328
Nov 30, 91 12531 12454 12375
Dec 31, 91 12584 12500 12422
Jan 31, 92 12630 12543 12464
Feb 29, 92 12668 12582 12502
Mar 31, 92 12708 12625 12540
Apr 30, 92 12744 12666 12576
May 31, 92 12779 12707 12612
Jun 30, 92 12817 12745 12647
Jul 31, 92 12852 12784 12680
Aug 31, 92 12885 12819 12711
Sep 30, 92 12917 12852 12741
Oct 31, 92 12947 12884 12769
Nov 30, 92 12978 12916 12798
Dec 31, 92 13008 12951 12828
Jan 31, 93 13036 12986 12857
Feb 28, 93 13062 13016 12885
Mar 31, 93 13093 13048 12912
Apr 30, 93 13122 13080 12939
May 31, 93 13148 13113 12967
Jun 30, 93 13178 13147 12994
Jul 31, 93 13208 13181 13021
Aug 31, 93 13235 13215 13049
Sep 30, 93 13263 13248 13076
Oct 31, 93 13291 13282 13104
Nov 30, 93 13320 13315 13132
Dec 31, 93 13351 13351 13161
Jan 31, 94 13379 13385 13189
Feb 28, 94 13406 13418 13218
Mar 31, 94 13437 13455 13248
Apr 30, 94 13470 13496 13281
May 31, 94 13512 13540 13317
Jun 30, 94 13555 13586 13356
Jul 31, 94 13603 13636 13397
Aug 31, 94 13651 13687 13439
Sep 30, 94 13701 13737 13485
Oct 31, 94 13755 13794 13532
Nov 30, 94 13812 13852 13582
Dec 31, 94 13880 13915 13636
Jan 31, 95 13943 13979 13694
Feb 28, 95 14006 14041 13754
Mar 31, 95 14081 14110 13816
Apr 30, 95 14145 14177 13877
May 31, 95 14216 14247 13939
Jun 30, 95 14289 14314 14000
Jul 31, 95 14355 14384 14060
Aug 31, 95 14423 14452 14120
Sep 30, 95 14492 14517 14180
Oct 31, 95 14558 14583 14239
Nov 30, 95 14624 14652 14299
Dec 31, 95 14695 14732 14359
Jan 31, 96 14760 14800 14418
Feb 29, 96 14821 14859 14474
Mar 31, 96 14885 14913 14529
Apr 30, 96 14947 14977 14584
May 31, 96 15015 15043 14640
Jun 30, 96 15073 15105 14695
Jul 31, 96 15139 15173 14752
Aug 31, 96 15209 15242 14809
Sep 30, 96 15269 15313 14867
Oct 31, 96 15336 15379 14929 0.0042
14929
Nov 30, 96 15403 15444 14987 0.0039
14987
Dec 31, 96 15470 15513 15045 0.0039
15045
Jan 31, 97 15540 15584 15104 0.0039
15104
Feb 28, 97 15602 15644 15162 0.0039
15162
Mar 31, 97 15666 15710 15221 0.0039
15221
Apr 30, 97 15734 15785 15286 0.0042
15286
</TABLE>
* Unannualized
+ Assumes initial investment of $10,000 on inception date, November 18, 1988.
Performance data illustrated is historical. Past performance is not
predictive of future performance. All performance figures assume
reinvestment of dividends. Management fees and other expenses are included
in the Fund's performance; however, fees and expenses are not incorporated
in the U.S. 91-Day T-Bill Index. An investment in the Fund is neither
insured nor guaranteed by the U.S. Government. The Fund seeks to maintain a
stable $1.00 share price although there is no assurance that it will be
able to do so.
20
<PAGE> 23
FREMONT FUNDS
With the Federal Funds Rate now at 5.50%, we believe the Federal Reserve is
close to accomplishing its goal of nipping any potential inflation in the bud.
We hope the Fed agrees. In our opinion, the traditional leading indicators of
inflation do not factor in the impact of a very competitive global economy on
wages and product pricing. Jobs will be exported if serious labor shortages and
wage pressures develop. American consumers will buy Toyotas if the price of
Fords and Chevys rise.
Although we don't have much confidence in politicians or government
bureaucrats, it is worth noting that the Labor Department recently endorsed a
study indicating that inflation is overstated in the Consumer Price Index by
approximately 0.5%. If the government institutes some of the proposed changes in
the methodologies used to calculate inflation, it may calm the inflationary
fears currently unsettling the financial markets and take pressure off the Fed
to raise rates higher than is justified by economic reality. We are maintaining
the Fund's average maturity at around 62 days and may extend it modestly if we
gain conviction the Federal Reserve perceives its inflation fighting initiatives
have succeeded. We will also continue to "barbell" the portfolio to hedge
against any overreaction by the Fed or the market.
We continue to seek fundamentally undervalued securities. Recently, we have
been buying Chevron UK commercial paper. This paper is issued on a private
placement basis, because unlike normal issue domestic commercial paper, the
proceeds from the offering do not have to be pledged to a specific corporate
purpose such as working capital. The market seems to perceive this as an added
risk and consequently prices these securities to yield 5-10 basis points more
than paper issued by its parent, U.S.-based Chevron. The market may be missing
the fact that the Chevron UK commercial paper is guaranteed by double-A-rated
Chevron USA and is every bit as liquid. We are delighted to take advantage of
the market's oversight and regularly pocket an additional 5-10 basis points on
this top quality credit.
In closing, we are pleased that the Fund has once again exceeded its
benchmark index and remains very near the top of its class in the taxable money
market fund universe. We are confident the Fund can build on its superior
performance record.
Sincerely,
/s/ Norman Gee
Norman Gee
Portfolio Manager
Fremont Money Market Fund
21
<PAGE> 24
FREMONT FUNDS
FREMONT CALIFORNIA INTERMEDIATE
TAX-FREE FUND
William M. Feeney, Portfolio Manager
Fremont Investment Advisors, Inc.
[PHOTO WILLIAM FEENEY]
William Feeney
FUND PROFILE
Fremont California Intermediate Tax-Free Fund invests in California municipal
bonds. Essential service bonds (water, sewer, electric, gas, etc.) and general
obligation bonds (secured by the full faith and credit of the government issuer)
are emphasized in this conservatively managed portfolio. Income from the Fund is
free from both federal and state taxes for California residents.
The direction of interest rates impacts the total return potential of
bonds. When interest rates decline, longer maturities and higher durations (a
measure of interest rate sensitivity) are advantageous. When interest rates
rise, the reverse is true. Through the analysis of macro-economic, political,
and market factors, Fund management strives to identify the dominant interest
rate trend. The Fund's strategy is simply to position the portfolio's
maturity/duration to take advantage of the dominant interest rate trend rather
than trading on largely unpredictable temporary interest rate fluctuations.
The Fund invests almost exclusively in the highest investment grade credits
and will not invest in any bond below a BBB rating. Fund management also strives
to identify "special situation" opportunities created by incomplete credit
analysis, investor misperception, and market conditions.
TO OUR SHAREHOLDERS
For the six month period ended April 30, 1997, the Fremont California
Intermediate Tax-Free Fund returned 1.52% compared to the Lehman Brothers
Municipal 5-Year State General Obligation (GO) Index's 1.40%.
The direction of interest rates is largely a function of inflation, real or
imagined. In recent months, both the bond market and Federal Reserve Chairman
Alan Greenspan have been concerned that much-better-than-expected economic
growth and some evidence of upward pressure on wages is foreshadowing higher
inflation down the road. The result has been rising interest rates all along the
yield curve.
FREMONT CALIFORNIA INTERMEDIATE TAX-FREE FUND INVESTMENT RETURNS
ANNUAL RETURNS
<TABLE>
<S> <C>
11/16/90-10/31/91* +9.35%
11/01/91-10/31/92 +7.37%
11/01/92-10/31/93 +11.37%
11/01/93-10/31/94 -3.94%
11/01/94-10/31/95 +12.77%
11/01/95-10/31/96 +4.63%
11/01/96- 4/30/97* +1.52%
AVERAGE ANNUAL +6.54% (SINCE INCEPTION)
</TABLE>
GROWTH OF $10,000+
AVERAGE ANNUAL RETURNS FOR
PERIODS ENDED 4/30/97
<TABLE>
<CAPTION>
1 5 SINCE INCEPTION
YEAR YEARS 11/16/90
<S> <C> <C>
5.00% 5.95% 6.54%
</TABLE>
<TABLE>
<CAPTION>
FREMONT CA INTER TAX-FREE FUND
LEHMAN STATE G.O.
MUNI 5 YR INDEX
<S> <C> <C>
Nov 16, 90 10000 10000
Nov 30, 90 10064 10067
Dec 31, 90 10105 10102
Jan 31, 91 10273 10250
Feb 28, 91 10364 10340
Mar 31, 91 10370 10313
Apr 30, 91 10467 10456
May 31, 91 10530 10508
Jun 30, 91 10496 10493
Jul 31, 91 10603 10598
Aug 31, 91 10737 10731
Sep 30, 91 10881 10860
Oct 31, 91 10936 10945
Nov 30, 91 10953 10979
Dec 31, 91 11187 11226
Jan 31, 92 11218 11246
Feb 29, 92 11222 11253
Mar 31, 92 11188 11211
Apr 30, 92 11270 11306
May 31, 92 11373 11413
Jun 30, 92 11535 11572
Jul 31, 92 11871 11876
Aug 31, 92 11747 11787
Sep 30, 92 11831 11862
Oct 31, 92 11741 11821
Nov 30, 92 11906 11962
Dec 31, 92 12004 12049
Jan 31, 93 12155 12180
Feb 28, 93 12518 12495
Mar 31, 93 12325 12357
Apr 30, 93 12434 12432
May 31, 93 12460 12475
Jun 30, 93 12666 12641
Jul 31, 93 12629 12642
Aug 31, 93 12889 12817
Sep 30, 93 13069 12915
Oct 31, 93 13076 12930
Nov 30, 93 12964 12899
Dec 31, 93 13198 13078
Jan 31, 94 13354 13202
Feb 28, 94 13007 12943
Mar 31, 94 12664 12653
Apr 30, 94 12717 12779
May 31, 94 12795 12854
Jun 30, 94 12714 12820
Jul 31, 94 12915 12954
Aug 31, 94 12945 13016
Sep 30, 94 12765 12920
Oct 31, 94 12561 12847
Nov 30, 94 12354 12750
Dec 31, 94 12552 12866
Jan 31, 95 12830 13001
Feb 28, 95 13208 13195
Mar 31, 95 13356 13323
Apr 30, 95 13382 13356
May 31, 95 13745 13646
Jun 30, 95 13652 13665
Jul 31, 95 13771 13856
Aug 31, 95 13920 13979
Sep 30, 95 13978 14023
Oct 31, 95 14165 14081
Nov 30, 95 14313 14204
Dec 31, 95 14421 14285
Jan 31, 96 14583 14464
Feb 29, 96 14519 14412
Mar 31, 96 14326 14326
Apr 30, 96 14330 14299
May 31, 96 14313 14280
Jun 30, 96 14394 14366
Jul 31, 96 14575 14470
Aug 31, 96 14557 14489
Sep 30, 96 14665 14589
Oct 31, 96 14820 14732
Nov 30, 96 15044 14941
Dec 31, 96 15005 14906
Jan 31, 97 15013 14944
Feb 28, 97 15110 15050
Mar 31, 97 14973 14879
Apr 30, 97 15046 14938
</TABLE>
* Unannualized
+ Assumes initial investment of $10,000 on inception date, November 16, 1990.
Performance data illustrated is historical. Past performance is not
predictive of future performance. Share price and return will vary so that
a gain or loss may be realized when shares are sold. All performance
figures assume reinvestment of dividends. Management fees and other
expenses are included in the Fund's performance; however, fees and expenses
are not incorporated in the Lehman Bros. 5-Year State G.O. Index.
22
<PAGE> 25
FREMONT FUNDS
PORTFOLIO CREDIT QUALITY OF FREMONT CALIFORNIA INTERMEDIATE
TAX-FREE FUND AS OF APRIL 30, 1997
<TABLE>
<S> <C>
A (15.7%)
AA (26.8%)
AAA (57.5%)
</TABLE>
Is this a change in the dominant interest rate trend or a hiccup produced by a
temporarily rambunctious economy? We are leaning toward the latter. With the
Federal Funds Rate and long-term Treasury Bond yield at 5.50% and 6.95% as of
late May, we believe the economy will slow and that inflation fears will
diminish. We expect interest rates to trend lower from current levels and bonds
to rally over the next year. Accordingly, we have kept the portfolio's average
maturity at 8.4 years, which is somewhat longer than the Lehman Brother's Index.
Now that the flat tax issue is once again dead and buried (a low flat
federal income tax would threaten the traditional tax advantages of purchasing
municipal securities), municipal bonds are no longer as cheap as they were
during the early stages of campaign 1996. But, relative to traditional spreads
between municipal bonds and Treasury securities, they are not expensive either.
Ten-year municipal bonds are now trading at about 75% of the price of ten-year
U.S. Treasuries; right around the historical average discount. In short, it
still makes economic sense for investors in the 30-35% tax brackets to own
municipal bonds. Consequently, we expect municipal bonds to continue to
outperform Treasuries on an after-tax total return basis, albeit not by the
margin they enjoyed in 1996.
The strong California economy continues to benefit municipal bonds in our
investment universe. Unemployment is currently 6.5%, down sharply from last
fall's 7.4%. Strong job growth has ended the population exodus and real estate
is booming. State and local tax coffers are filling and further general
obligation bond credit upgrades may be on the horizon. California municipal
bonds are also benefiting from limited supply in the market. With relatively few
new issues, investors are increasingly willing to pay a premium for quality
credits.
We continue to look for attractively priced sectors in the California
municipal bond universe. Right now with sales tax revenues climbing, we are
focusing on sales tax-backed bonds like the Bay Area Rapid Transit (BART) and
the Orange County Transportation issues. We were able to buy these bonds at
fundamentally attractive prices considering the solid prospects for future
credit upgrades.
In conclusion, we believe the rising interest rates that restrained the
Fund's returns over this reporting period are a relatively short-term phenomena
rather than a reversal of the dominant interest rate trend. In the immediate
future, interest rates may continue to fluctuate somewhat wildly as nervous
investors digest often contradictory economic data. However, we don't think
inflation is a real threat to the economy and we expect interest rates to come
down and the fixed-income markets to trend higher as inflationary fears
diminish.
We thank you for entrusting your assets to us and will continue to work
hard to justify your faith in our investment abilities.
Sincerely,
/s/ William M. Feeney
William M. Feeney
Portfolio Manager
Fremont California Intermediate Tax-Free Fund
23
<PAGE> 26
FREMONT FUNDS
This page left blank intentionally.
24
<PAGE> 27
FREMONT GLOBAL FUND
April 30, 1997 (Unaudited)
STATEMENT OF INVESTMENTS
IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
STOCKS 65.1%
BUSINESS EQUIPMENT & SERVICES 2.0%
2,800 Sodexho Alliance SA FR $ 1,287,246
143,000 Kyowa Exeo Corp. JP 1,160,037
100,000 Compass Group PLC UK 1,103,579
* 56,200 Federal Express Corp. US 3,027,775
59,700 First Data Corp. US 2,059,650
10,800 Omnicom Group, Inc. US 572,400
103,400 WMX Technologies, Inc. US 3,037,375
-------------
12,248,062
-------------
CAPITAL GOODS 2.6%
50,000 Larsen & Toubro Ltd., GDR IN 706,250
8,400 Kyocera Corp., ADR JP 1,012,200
60,000 Cemex SA (Class B), ADR MX 443,627
370,000 IJM Corp. Berhad MY 810,821
110,000 Cycle & Carriage Ltd. SG 1,125,320
20 Zardoya-Otis SP 2,150
80,000 Autoliv AB SW 2,915,124
132,000 Sandvik AB (Series B) SW 3,251,564
31,900 Caterpillar, Inc. US 2,839,100
46,600 Emerson Electric Co. US 2,364,950
7,900 Hughes Supply, Inc. US 261,688
15,540 Mark IV Industries, Inc. US 361,306
-------------
16,094,100
-------------
CONSUMER DURABLES 4.5%
* 33,600 Daimler-Benz AG GM 2,487,018
* 494 Daimler-Benz AG (Rights) GM 28
26,300 Daimler-Benz AG, ADR GM 1,956,063
1,000 Fukoku Co. Ltd. JP 7,954
35,000 Honda Motor Co. Ltd. JP 1,086,083
33,000 Murata Manufacturing Co. Ltd. JP 1,216,350
33,000 Sony Corp., ADR JP 2,421,375
50,000 Philips Electronics NV NL 2,613,791
40,000 Philips Electronics NV
(New York Shares) NL 2,140,000
55,100 Chrysler Corp. US 1,653,000
36,700 Eaton Corp. US 2,747,913
107,900 Ford Motor Co. US 3,749,525
66,000 General Motors Corp. US 3,819,750
46,200 Whirlpool Corp. US 2,159,850
-------------
28,058,700
-------------
CONSUMER NON-DURABLES 2.0%
50,426 Coca-Cola Amatil Ltd. AU 576,831
5,760 LVMH FR 1,408,011
440 LVMH, ADR FR 21,340
76,000 Cerebos Pacific Ltd. SG 467,547
108,000 Fraser & Neave Ltd. SG 783,852
100,000 Srithai Superware Co. Ltd.
(Foreign Registered) TH 459,418
* 58,981 President Enterprises, GDR TW 1,046,916
170,000 Associated British Foods PLC UK 1,472,684
94,000 American Greetings Corp. (Class A) US 3,008,000
40,200 VF Corp. US 2,899,425
-------------
12,144,024
-------------
CONSUMER SERVICES 1.9%
22,000 News Corp. Ltd., ADR AU 407,000
197,274 Village Roadshow Ltd. (Preferred) AU 500,314
35,000 Secom Co. JP 2,081,200
20,000 Sega Enterprises Ltd. JP 526,109
10,000 Sega Enterprises Ltd., ADR JP 65,794
265,000 Genting Berhad MY 1,414,854
70,600 Elsevier NV NL 1,132,241
7,902 Wolters Kluwer NV NL 937,866
9,953 Wolters Kluwer NV, ADR NL 1,179,681
280,000 Helicopter Line Ltd. (The) NZ 452,015
180,000 Rentokil Initial PLC UK 1,183,381
26,200 Disney (Walt) Co. US 2,148,400
-------------
12,028,855
-------------
ENERGY 7.0%
* 15 Petrofina SA (Warrants 06/03/97) BE 116
41,900 Amoco Corp. US 3,503,888
22,200 Atlantic Richfield Co. US 3,021,975
58,400 Chevron Corp. US 4,000,400
33,600 Devon Energy Corp. US 1,108,800
68,500 Dresser Industries, Inc. US 2,046,437
* 17,400 ENSCO International, Inc. US 826,500
144,400 Exxon Corp. US 8,176,650
36,300 Kerr-McGee Corp. US 2,191,612
42,700 Mobil Corp. US 5,551,000
91,400 Occidental Petroleum Corp. US 2,022,225
46,200 Phillips Petroleum Co. US 1,819,125
42,600 Texaco, Inc. US 4,494,300
22,000 Tidewater, Inc. US 882,750
45,200 Unocal Corp. US 1,723,250
71,000 USX-Marathon Group US 1,961,375
-------------
43,330,403
-------------
FINANCIAL SERVICES 12.7%
62,859 Lend Lease Corp. Ltd. AU 1,203,737
200,000 Westpac Banking Corp. Ltd. AU 1,078,443
5,000 Union Financiere de
France Banque SA FR 561,798
2,905,500 PT Lippo Bank (Foreign Registered) ID 2,779,954
150,000 Instituto Mobiliare Italiano SPA IT 1,279,423
200,000 Commerce Asset Holding Berhad MY 1,195,314
33,912 Aegon NV (New York Shares) NL 2,458,620
49,000 ING Groep NV NL 1,926,804
180,416 Overseas-Chinese Banking Corp. Ltd.
(Foreign Registered) SG 2,107,576
250,000 Overseas Union Bank Ltd.
(Foreign Registered) SG 1,641,667
214,899 United Overseas Bank Ltd.
(Foreign Registered) SG 2,020,204
6,300 Housing & Commercial Bank, Korea SK 108,767
* 130 Samsung Fire & Marine Insurance SK 42,702
* 24,285 Thai Farmers Bank
(Warrants 09/15/02) TH 17,665
129,790 HSBC Holdings PLC
(Hong Kong Shares) UK 3,283,871
72,800 Ahmanson (H.F.) & Co. US 2,775,500
49,700 Allstate Corp. US 3,255,350
44,000 American Express Co. US 2,898,500
57,000 Banc One Corp. US 2,415,375
31,500 BankAmerica Corp. US 3,681,563
30,300 Bankers Trust New York Corp. US 2,465,663
13,900 Cigna Corp. US 2,090,213
37,200 Citicorp US 4,189,650
69,400 Dean Witter, Discover & Co. US 2,654,550
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
25
<PAGE> 28
FREMONT GLOBAL FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
FINANCIAL SERVICES (CONTINUED)
84,400 Federal Home Loan Mortgage Corp. US $ 2,690,250
48,200 First Chicago NBD Corp. US 2,711,250
29,800 First Union Corp. US 2,503,200
47,600 Fleet Financial Group, Inc. US 2,903,600
16,400 Horace Mann Educators Corp. US 768,750
15,400 Mercury General Corp. US 954,800
59,600 NationsBank Corp. US 3,598,350
51,400 Norwest Corp. US 2,563,575
8,000 Price (T. Rowe) Associates US 370,000
35,500 Republic New York Corp. US 3,252,688
58,933 Travelers, Inc. US 3,263,415
94,400 USLIFE Corp. US 4,578,400
5,200 Zions Bancorporation US 657,800
-------------
78,948,987
-------------
HEALTH CARE 4.4%
* 62,500 Fresenius Medical Care AG, ADR GM 1,835,937
200,500 PT Dankos Laboratories
(Foreign Registered) ID 146,456
22,000 Grupo Casa Autrey SP, ADR MX 382,250
8,000 Astra AB (Series A) SW 327,760
1,386 Novartis AG (Registered Shares) SZ 1,829,784
260 Roche Holding AG SZ 2,200,544
36,900 Aetna, Inc. US 3,362,513
71,800 Baxter International, Inc. US 3,437,425
* 8,200 Biogen, Inc. US 262,400
72,300 Columbia HCA Healthcare Corp. US 2,530,500
* 8,000 HealthCare COMPARE Corp. US 347,000
37,100 Medtronic, Inc. US 2,569,175
* 31,400 NovaCare, Inc. US 357,175
* 3,800 PacifiCare Health Systems, Inc.
(Class B) US 304,950
90,500 Pharmacia & Upjohn, Inc. US 2,681,063
* 27,100 Sola International, Inc. US 677,500
29,500 United Healthcare Corp. US 1,434,437
25,400 Warner-Lambert Co. US 2,489,200
-------------
27,176,069
-------------
MISCELLANEOUS 0.3%
100,900 Taiwan Index Fund Ltd. TW 1,578,076
-------------
1,578,076
-------------
MULTI-INDUSTRY 2.4%
2,400 Viag AG GM 1,071,416
* 685 Viag AG (New) GM 301,047
770,000 Citic Pacific Ltd. HK 4,164,795
360,000 Hutchison Whampoa HK 2,672,140
1,240,000 Renong Berhad MY 1,699,577
*248,000 Renong Berhad
(Convertible Loan Stock 05/21/01) MY 87,943
*155,000 Renong Berhad
(Warrants Exp. 11/21/00) MY 85,226
22,800 Minnesota Mining &
Manufacturing Co. US 1,983,600
53,000 TRW, Inc. US 2,762,625
-------------
14,828,369
-------------
RAW MATERIALS 2.8%
37,800 Broken Hill Proprietary Co.
Ltd., ADR AU 1,072,575
54,000 BASF AG GM 2,074,064
* 61,000 Bayer AG GM 2,429,700
27,908 Hansol Paper Ltd., GDR SK $ 273,917
13,490 Hansol Paper Ltd., GDR SK 132,404
* 1,386 Ciba Specialty Chemicals AG
(Registered Shares) SZ 119,661
15,000 Tipco Asphalt Public Co. Ltd.
(Foreign Registered) TH 75,804
44,600 Aluminum Co. of America US 3,116,425
41,700 Dow Chemical Co. US 3,539,287
129,900 Engelhard Corp. US 2,727,900
52,900 Goodrich (B.F.) Co. US 2,109,388
-------------
17,671,125
-------------
RETAIL 2.1%
4,350 Hermes International FR 1,171,541
29,000 Ito-Yokado Co. Ltd. JP 1,390,958
224,460 Cifra SA de CV MX 341,717
* 23,200 CompUSA, Inc. US 446,600
* 17,400 Consolidated Stores Corp. US 696,000
* 66,400 Federated Department Stores, Inc. US 2,257,600
25,000 Hannaford Brothers Co. US 796,875
8,800 Lowe's Cos., Inc. US 334,400
50,300 McDonalds Corp. US 2,697,337
65,900 Sears, Roebuck and Co. US 3,163,200
-------------
13,296,228
-------------
SHELTER 2.1%
188,000 Cheung Kong (Holdings) Ltd. HK 1,650,272
1,044,000 PT Jaya Real Property
(Foreign Registered) ID 1,353,333
140,000 Kimberly-Clark de Mexico SA MX 514,343
1,406,250 Ayala Land, Inc. PH 1,013,225
4,200,000 C & P Homes, Inc. PH 1,592,719
500,000 DBS Land Ltd. SG 1,617,474
37,000 Armstrong World Industries, Inc. US 2,432,750
43,000 Kimberly-Clark Corp. US 2,203,750
* 31,800 Owens-Illinois, Inc. US 858,600
-------------
13,236,466
-------------
TECHNOLOGY 7.8%
50,000 Nokia AB, ADR FI 3,231,250
6,000 SAP AG, ADR GM 364,500
110,000 Canon, Inc. JP 2,607,702
18,900 Hirose Electronics JP 1,033,047
40,000 Hoya Corp. JP 1,833,504
14,000 TDK Corp. JP 1,008,900
55,000 Tokyo Electron Ltd. JP 2,122,548
600,000 Informatics Holdings Ltd. SG 298,611
* 40,531 Samsung Electronics Ltd., GDS
(1/2 Non-Voting) SK 932,213
* 5,575 Samsung Electronics Ltd., GDS
(1/2 Voting) SK 262,038
3,720 Sungmi Telecom Electronics SK 500,448
* 28,600 Applied Materials, Inc. US 1,569,425
40,600 Avnet, Inc. US 2,471,525
30,500 Boeing Co. US 3,008,063
49,000 International Business
Machines Corp. US 7,876,750
* 41,200 Komag, Inc. US 1,163,900
69,300 Motorola, Inc. US 3,967,425
43,000 Rockwell International Corp. US 2,859,500
33,900 Texas Instruments, Inc. US 3,025,575
7,400 Thiokol Corp. US 482,850
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
26
<PAGE> 29
FREMONT GLOBAL FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
TECHNOLOGY (CONTINUED)
* 46,500 Ultratech Stepper, Inc. US $ 834,094
23,100 United Technologies Corp. US 1,746,938
47,300 Xerox Corp. US 2,908,950
* 23,900 Xilinx, Inc. US 1,171,100
10,800 Harris Corp. US 923,400
-------------
48,204,256
-------------
TRANSPORTATION 1.3%
836,000 Comfort Group Ltd. SG 635,653
156,250 Keppel Corp. SG 680,428
8,500 Keppel Corp.
(Convertible Loan Stock 07/15/97) SG 7,050
* 10,625 Keppel Corp. (Warrants 06/30/97) SG 10,723
* 9,770 Korean Air SK 176,342
100,000 British Airways PLC UK 1,147,462
36,300 Burlington Northern Sante Fe US 2,858,626
16,055 Conrail, Inc. US 1,834,284
* 34,100 Yellow Corp. US 656,426
-------------
8,006,994
-------------
UTILITIES 9.2%
20,000 Telecomunicacoes Brasileiras
SA, ADR BR 2,295,000
42,500 Cia de Telecomunicaciones
de Chile SA, ADR CL 1,375,938
* 42,048 Hong Kong & China Gas Co.
(Warrants 09/30/97) HK 21,169
17,500 PT Indosat, ADR ID 481,250
1,020,000 Telecom Italia Mobile SPA IT 3,212,199
255 Nippon Telegraph & Telephone JP 1,797,472
44,200 Telecom of New Zealand, ADR NZ 1,591,200
305,974 Manila Electric Co. (Class B) PH 1,902,910
14,900 Philippine Long Distance
Telephone Co. PH 850,379
70,000 Korea Electric Power Corp., ADR SK 1,190,000
62,830 Korea Mobile
Telecommunications, ADR SK 596,885
130,962 Cable & Wireless PLC UK 1,012,114
*178,600 AirTouch Communications, Inc. US 4,554,300
51,400 Ameritech Corp. US 3,141,825
50,000 Bell Atlantic Corp. US 3,387,500
78,900 BellSouth Corp. US 3,511,050
45,100 Coastal Corp. US 2,142,251
88,800 Consolidated Edison Co.
of New York, Inc. US 2,464,200
100,300 Entergy Corp. US 2,344,512
44,300 GTE Corp. US 2,032,262
65,500 NYNEX Corp. US 3,389,625
156,900 PG&E Corp. US 3,765,600
50,800 Texas Utilities Co. US 1,714,500
156,700 Unicom Corp. US 3,408,226
79,300 Williams Cos., Inc. US 3,479,288
* 57,700 WorldCom, Inc. US 1,384,800
-------------
57,046,455
-------------
TOTAL STOCKS (COST $358,696,688) $403,897,169
-------------
</TABLE>
<TABLE>
<CAPTION>
Value
Face Amount/Issuer/Coupon Rate/Stated Maturity (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
BONDS 24.3%
CORPORATE BONDS 4.9%
2,000,000 Asia Pulp & Paper International Finance,
10.250%, 10/01/00 $ 2,025,000
2,000,000 BankAmerica Corp., 8.125%, 08/15/04
(Callable 08/15/99 @ 100) 2,092,460
3,000,000 Cemex SA de CV, 10.750%, 07/15/00 3,161,250
1,600,000 Chrysler Corp., 10.400%,
08/01/99 (Callable 08/01/97 @ 100) 1,615,984
4,000,000 Export-Import Bank of Korea,
6.500%, 05/15/00 3,955,760
3,000,000 Ford Motor Credit Corp.,
6.800%, 04/23/01 2,990,160
2,500,000 General Electric Capital Corp.,
8.850%, 03/01/07 2,790,250
3,000,000 General Motors Acceptance Corp.,
7.500%, 07/24/00 3,058,950
1,500,000 Korea Development Bank, 5.875%, 12/01/98 1,486,710
2,000,000 Pohang Iron & Steel Co. Ltd.,
7.375%, 05/15/05 1,992,360
3,000,000 Sears, Roebuck and Co., 6.240%,
08/03/99 2,973,690
2,000,000 Wharf International Finance,
7.625%, 05/13/07 1,958,720
42,197 Zions Auto Trust, 5.650%, 06/15/99 42,190
-------------
30,143,484
-------------
MORTGAGE BACKED SECURITIES 0.2%
1,355,117 FNMA CMO, 1992-137BA REMIC,
3.500%, 01/25/17 1,293,703
-------------
1,293,703
-------------
U.S. GOVERNMENT BONDS 2.5%
4,000,000 Federal National Mortgage Association
6.500%, 02/25/02 3,946,880
U.S. Treasury Notes
5,000,000 6.125%, 12/31/01 4,913,300
4,000,000 6.375%, 09/30/01 3,971,880
3,000,000 7.125%, 02/29/00 3,052,980
-------------
15,885,040
-------------
FOREIGN BONDS 16.7%
AUS$ 4,000,000 European Bank for Reconstruction
and Development, 9.000%, 10/15/02 3,320,389
Government of Australia
AUS$ 4,000,000 7.500%, 07/15/05 3,077,825
AUS$ 4,000,000 8.750%, 01/15/01 3,297,665
Morgan Guaranty Trust Co.
AUS$ 4,500,000 8.000%, 04/18/01 3,588,391
European Investment Bank
CAN$ 4,000,000 7.750%, 04/22/03 3,017,936
Government of Canada
CAN$ 4,000,000 7.500%, 03/01/01 3,028,619
CAN$ 4,000,000 8.000%, 06/01/23 3,147,531
Japan Highway Public Corp.
CAN$ 2,000,000 7.875%, 09/27/02 1,515,233
Oesterreichische Kontrollbank
(Republic of Austria)
CAN$ 2,000,000 9.000%, 06/19/02 1,586,833
Republic of Finland
CAN$ 2,000,000 9.500%, 09/15/04 1,650,378
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
27
<PAGE> 30
FREMONT GLOBAL FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Value
Face Amount/Issuer/Coupon Rate/Stated Maturity (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
FOREIGN BONDS (CONTINUED)
Toyko Electric Power
CAN$ 2,000,000 10.500%, 06/14/01 $ 1,645,008
Government of France
FF 20,000,000 8.500%, 11/25/02 4,016,811
Federal Republic of Germany
DM 6,000,000 6.000%, 01/05/06 3,536,229
DM 3,000,000 6.750%, 04/22/03 1,876,366
DM 4,500,000 6.875%, 05/12/05 2,810,646
German Unity Fund
DM 5,000,000 8.000%, 01/21/02 3,280,229
Treuhandanstalt
DM 3,000,000 7.750%, 10/01/02 1,957,729
United Mexican States
DM 6,000,000 8.125%, 09/10/04 3,651,767
World Bank
DM 3,000,000 6.125%, 09/27/02 1,825,883
Government of Ireland
IEP 2,000,000 6.250%, 04/01/99 3,016,500
IEP 2,000,000 6.500%, 10/18/01 3,051,000
IEP 2,000,000 8.000%, 08/18/06 3,250,500
Government of Netherlands
NLG 6,000,000 6.500%, 04/15/03 3,304,634
Government of Sweden
SEK 40,000,000 6.000%, 02/09/05 4,788,105
SEK 25,000,000 10.250%, 05/05/03 3,751,883
U.K. Treasury
pound sterling 2,500,000 6.750%, 11/26/04 3,918,497
pound sterling 2,000,000 7.000%, 11/06/01 3,224,189
pound sterling 2,500,000 7.500%, 12/07/06 4,065,790
pound sterling 2,000,000 8.500%, 12/07/05 3,461,889
pound sterling 2,000,000 9.000%, 07/12/11 3,627,466
pound sterling 2,000,000 9.750%, 08/27/02 3,593,945
Republic of Argentina, FRN
US$ 7,000,000 5.250%, 03/31/23, (Callable
Semiannually in May or
November @ 100) 4,558,750
United Mexican States
US$ 6,000,000 6.250%, 12/31/19
(Callable at any time @ 100) 4,357,500
-------------
103,802,116
-------------
TOTAL BONDS (COST $152,452,012) 151,124,343
-------------
</TABLE>
<TABLE>
<CAPTION>
Value
Face Amount/Issuer/Discount Rate/Stated Maturity (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
SHORT TERM SECURITIES 9.8%
10,879,134 Benchmark Diversified Assets Fund 10,879,135
5,000,000 American Express Credit Corp., CP,
5.500%, 05/05/97 4,996,944
5,000,000 Caisse d'Amortissement de la Dette
Sociale, CP, 5.550%, 05/07/97 4,995,375
5,000,000 Chevron UK Investment PLC, CP,
5.470%, 05/06/97 4,996,201
5,000,000 Daimler-Benz North America Corp., CP,
5.510%, 05/08/97 4,994,643
5,000,000 Deutsche Bank Financial, Inc., CP,
5.470%, 05/01/97 5,000,000
5,000,000 Deutsche Bank Financial, Inc., CP,
5.450%, 05/02/97 4,999,243
5,000,000 General Electric Capital Corp., CP,
5.460%, 05/09/97 4,993,933
5,000,000 Hitachi America Ltd., CP,
5.450%, 05/07/97 4,995,458
5,000,000 Honeywell, Inc., CP,
5.500%, 05/02/97 4,999,237
** 5,000,000 RTZ America, Inc., CP,
5.530%, 05/01/97 5,000,000
-------------
TOTAL SHORT TERM SECURITIES (COST $60,850,169) 60,850,169
-------------
TOTAL INVESTMENTS (COST $571,998,869), 99.2% 615,871,681
OTHER ASSETS AND LIABILITIES, NET, 0.8% 5,188,467
-------------
NET ASSETS, 100.0% $ 621,060,148
=============
</TABLE>
PORTFOLIO ABBREVIATIONS:
ADR - American Depository Receipt
CP - Commercial Paper
CMO - Collateralized Mortgage Obligation
FNMA - Federal National Mortgage Association
FRN - Floating Rate Note
GDR - Global Depository Receipt
GDS - Global Depository Share
REMIC - Real Estate Mortgage Investment Conduit
CURRENCY ABBREVIATIONS:
AUS$ - Australian Dollar
CAN$ - Canadian Dollar
DM - German Deutschemark
FF - French Franc
IEP - Irish Punt
NLG - Netherlands Guilder
SEK - Swedish Krona
pound sterling - British Pound
US$ - US Dollar
** These securities are generally issued to institutional investors. Any
resale must be in an exempt transaction pursuant to Section 4(2) of the
Securities Act of 1933.
The accompanying notes are an integral part of these financial statements.
28
<PAGE> 31
FREMONT GLOBAL FUND
April 30, 1997 (Unaudited)
COUNTRY DIVERSIFICATION
<TABLE>
<CAPTION>
Country % of
Code Country Name Net Assets
- --------------------------------------------------------------
<S> <C> <C>
AU Australia 2.9%
BR Brazil 0.4%
CL Chile 0.2%
CN Canada 2.7%
DK Denmark 0.1%
FI Finland 0.5%
FR France 1.4%
GM Germany 5.3%
HK Hong Kong 1.4%
ID Indonesia 0.8%
IN India 0.1%
IR Ireland 1.5%
IT Italy 0.7%
JP Japan 3.5%
MX Mexico 0.3%
MY Malaysia 0.9%
NL Netherlands 2.6%
NZ New Zealand 0.3%
PH Philippines 0.9%
SG Singapore 1.8%
SK South Korea 0.7%
SP Spain (less than 0.1%) 0.0%
SW Sweden 2.6%
SZ Switzerland 0.7%
TH Thailand 0.1%
TW Taiwan 0.4%
UK United Kingdom 5.1%
US United States 62.1%
-----
TOTAL 100.0%
=====
</TABLE>
The accompanying notes are an integral part of these financial statements.
29
<PAGE> 32
FREMONT INTERNATIONAL GROWTH FUND
April 30, 1997 (Unaudited)
STATEMENT OF INVESTMENTS
IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
STOCKS 94.5%
BUSINESS EQUIPMENT & SERVICES 2.3%
825 Sodexho Alliance SA FR $ 379,278
45,000 Compass Group PLC UK 496,610
-------------
875,888
-------------
CAPITAL GOODS 7.8%
7,000 Kyocera Corp. JP 418,997
6,000 Mabuchi Motors Co. JP 303,851
130,000 IJM Corp. Berhad MY 284,883
28,000 Sandvik AB (Series B) SW 689,726
60,000 SKF AB (Series B) SW 1,301,851
-------------
2,999,308
-------------
CONSUMER DURABLES 10.1%
1,450 Rexel SA FR 386,783
1,200 Volkswagen AG GM 761,927
28,000 Alpine Electronics, Inc. JP 392,534
15,000 Matsushita-Kotobuki Electronics JP 478,459
10,000 Murata Manufacturing Co. Ltd. JP 368,591
6,000 Sony Corp. JP 436,639
20,000 Philips Electronics NV
(New York Shares) NL 1,070,000
-------------
3,894,933
-------------
CONSUMER NON-DURABLES 2.4%
50,426 Coca-Cola Amatil Ltd. AU 576,831
80,000 PT Hanjaya Mandala Sampoerna
(Foreign Registered) ID 321,811
6,600 Siam Makro Public Co. Ltd.
(Foreign Registered) TH 14,529
-------------
913,171
-------------
CONSUMER SERVICES 3.5%
200,000 PT Steady Safe (Foreign Registered) ID 195,473
8,000 Secom Co. JP 475,703
105,000 Rentokil Initial PLC UK 690,305
-------------
1,361,481
-------------
FINANCIAL SERVICES 15.6%
165,284 Reinsurance Australia Corp. Ltd. AU 510,758
31,000 Credit Commercial de France FR 1,377,305
100,000 Dao Heng Bank Group Ltd. HK 475,047
400,000 PT Lippo Bank (Foreign Registered) ID 382,716
200,000 Public Bank Berhad
(Foreign Registered) MY 331,500
14,557 Aegon NV (New York Shares) NL 1,055,395
11,000 ING Groep NV NL 432,548
50,000 Overseas-Chinese Banking Corp. Ltd.
(Foreign Registered) SG 584,088
60,000 Overseas Union Bank Ltd.
(Foreign Registered) SG 394,000
40,000 United Overseas Bank Ltd.
(Foreign Registered) SG 376,028
7,850 Kookmin Bank SK 123,206
3,750 Thai Farmers Bank
(Warrants 09/15/02) TH 2,728
-------------
6,045,319
-------------
HEALTH CARE 5.6%
* 12,500 Fresenius Medical Care AG, ADR GM $ 367,188
2,700 Santen Pharmaceutical Co. JP 48,484
319 Novartis AG (Registered Shares) SZ 421,141
73 Roche Holding AG SZ 617,845
18,000 Glaxo Wellcome PLC, ADR UK 708,750
-------------
2,163,408
-------------
MULTI-INDUSTRY 9.5%
* 494,000 International UNP Holdings CN 58,361
50,000 Cheung Kong (Holdings) Ltd. HK 438,902
200,000 Citic Pacific Ltd. HK 1,081,765
98,000 Hutchison Whampoa HK 727,416
650,000 Renong Berhad MY 890,908
* 72,000 Renong Berhad
(Convertible Loan Stock 05/21/01) MY 25,532
* 45,000 Renong Berhad
(Warrants Exp. 11/21/00) MY 24,743
35,000 ABB AB (Series B) SW 424,378
-------------
3,672,005
-------------
RAW MATERIALS 5.6%
2,127 M.I.M. Holdings Ltd. AU 2,772
9,500 Compagnie de Saint-Gobain FR 1,274,380
13,000 BASF AG GM 499,312
* 20,400 Concordia Paper Holdings Ltd., ADR HK 66,300
17,443 Hansol Paper Ltd., GDR SK 171,203
* 319 Ciba Specialty Chemicals AG
(Registered Shares) SZ 27,541
28,000 Siam City Cement Public Co. Ltd.
(Foreign Registered) TH 130,781
-------------
2,172,289
-------------
RETAIL 1.7%
2,200 Ito Yokado Co. Ltd., ADR JP 422,950
45,000 The Pizza Public Co. Ltd.
(Foreign Registered) TH 256,700
-------------
679,650
-------------
SHELTER 1.0%
125,000 DBS Land Ltd. SG 404,369
-------------
404,369
-------------
TECHNOLOGY 18.9%
25,000 Nokia AB, ADR FI 1,615,625
10,000 TT Tieto OY (Class B) FI 760,610
5,500 SAP AG (Preferred) GM 1,014,254
1,100 Advantest Corp. JP 61,077
5,500 Canon, Inc., ADR JP 653,125
17,000 Hoya Corp. JP 779,239
16 NTT Data Communications
Systems Co. JP 467,512
300,000 Datacraft Asia Ltd. SG 660,000
600,000 Informatics Holdings Ltd. SG 298,611
* 5,658 Samsung Electronics Ltd., GDS
(1/2 Non-Voting) SK 130,134
* 169 Samsung Electronics Ltd., GDS
(1/2 Voting) SK 7,943
3,500 Sungmi Telecom Electronics SK 470,852
* 20,000 Enator AB SW 403,318
-------------
7,322,300
-------------
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
30
<PAGE> 33
FREMONT INTERNATIONAL GROWTH FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
TRANSPORTATION 1.4%
46,000 British Airways PLC UK $ 527,832
-------------
527,832
-------------
UTILITIES 9.1%
13,000 VEBA AG GM 675,447
600,000 Telecom Italia SPA IT 1,580,748
51 Nippon Telegraph & Telephone JP 359,494
75,075 Manila Electric Co. (Class B) PH 466,906
55,407 Cable & Wireless PLC UK 428,202
-------------
3,510,797
-------------
TOTAL STOCKS (COST $34,173,365) 36,542,750
-------------
</TABLE>
<TABLE>
<CAPTION>
Country Value
Face Amount/Issuer/Discount Rate/Stated Maturity Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
SHORT TERM SECURITIES 7.0%
808,556 Benchmark Diversified Assets Fund US 808,556
1,900,000 Honeywell, Inc., CP, 5.600%,
05/01/97 US 1,900,000
------------
TOTAL SHORT TERM SECURITIES (COST $2,708,556) 2,708,556
------------
TOTAL INVESTMENTS (COST $36,881,921), 101.5% 39,251,306
OTHER ASSETS AND LIABILITIES, NET, (1.5)% (596,237)
------------
NET ASSETS, 100.0% $ 38,655,069
============
</TABLE>
PORTFOLIO ABBREVIATIONS:
ADR - American Depository Receipt
CP - Commercial Paper
GDR - Global Depository Receipt
GDS - Global Depository Shares
COUNTRY DIVERSIFICATION
<TABLE>
<CAPTION>
Country % of
Code Country Name Net Assets
- ----------------------------------------------------------------
<S> <C> <C>
AU Australia 2.8%
CN Canada 0.2%
FI Finland 6.2%
FR France 8.9%
GM Germany 8.6%
HK Hong Kong 7.2%
ID Indonesia 2.3%
IT Italy 4.1%
JP Japan 14.7%
MY Malaysia 4.0%
NL Netherlands 6.6%
PH Philippines 1.2%
SG Singapore 7.0%
SK South Korea 2.3%
SW Sweden 7.3%
SZ Switzerland 2.8%
TH Thailand 1.1%
UK United Kingdom 7.4%
US United States 5.3%
-----
100.0%
=====
</TABLE>
The accompanying notes are an integral part of these financial statements.
31
<PAGE> 34
FREMONT INTERNATIONAL SMALL CAP FUND
April 30, 1997 (Unaudited)
STATEMENT OF INVESTMENTS
IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
STOCKS 98.0%
BUSINESS EQUIPMENT & SERVICES 1.8%
18,000 Hong Kong Aircraft Engineering
Co. Ltd. HK $ 52,049
6,000 Kyudenko Co. Ltd. JP 42,530
5,000 Toenec Corp. JP 25,793
8,933 Cowie Group PLC UK 53,865
-----------
174,237
-----------
CAPITAL GOODS 14.8%
5,400 Metal Manufactures Ltd. AU 13,063
*7,980,000 Companhia de Acos
Especiais Itabira-Acesita BR 17,940
6,400,000 Companhia Siderurgica de Tubarao
(Preferred B) BR 90,001
* 18,400 Stelco, Inc. CN 108,030
* 356 Skoda Telecom Plzen AS CZ 11,389
5,300 Rautaruukki OY FI 46,538
5,000 Aida Engineering Ltd. JP 30,716
7,000 Bunka Shutter Co. Ltd. JP 35,946
10,000 Eagle Industry Co. JP 39,379
22,000 Energy Support JP 60,124
1,000 Inaba Denkisangyo Co. JP 15,515
* 40,000 Mitsubishi Steel Manufacturing JP 105,537
41,000 NHK Spring Co. Ltd. JP 130,779
13,000 Pacific Industrial JP 59,384
3,000 Seirei Industry JP 11,105
2,200 Yokogawa Bridge Corp. JP 12,597
4,900 Koninklijke Hoogovens NV NL 224,164
6,700 Steel & Tube Holdings Ltd. NZ 33,423
36,000 Van Der Horst Ltd. SG 103,518
8,000 Dongkuk Steel Mill Co. SK 177,578
7,000 Poongsan Corp. SK 71,413
-----------
1,398,139
-----------
CONSUMER DURABLES 2.7%
* 9,679 Ciadea Transportation SA AR 41,141
100,000 Brasmotor SA (Preferred) BR 25,021
2,500 Sommer-Allibert FR 90,059
24,000 Johnson Electric Holdings Ltd. HK 65,061
4,100 Toyota South Africa Ltd. SA 23,966
900 American Standard Sanitaryware
Public Co. Ltd.
(Foreign Registered) TH 1,895
* 2,600 Karat Sanitaryware Public Co. Ltd.
(Foreign Registered) TH 1,568
87,987 Arcelik AS TU 10,546
-----------
259,257
-----------
CONSUMER NON-DURABLES 7.4%
9,780 Rothmans Holdings Ltd. AU 64,184
1,300,000 Bombril SA (Preferred) BR 19,553
*8,700,000 Ceval Alimentos SA (Preferred) BR 89,529
9,800,000 Perdigao SA Comercio e Industria
(Preferred) BR 20,280
68,200 Sadia-Concordia SA Industria
e Comercio (Preferred) BR 57,737
100,000 Sao Paulo Alpargatas
SA (Preferred) BR 4,891
* 107 Cokoladovny AS CZ 13,152
250 Deveaux SA FR 36,581
50 Fromageries Bel SA FR 37,825
1,100 Delta Dairy SA (Preferred) GR $ 10,952
1,100 Hellenic Sugar Industry SA GR 7,488
7,000 Lai Sun Garment
(International) Ltd. HK 8,584
17,000 PT Japfa Comfeed Indonesia
(Foreign Registered) ID 11,019
4,000 Daito Gyorui Co. Ltd. JP 8,821
6,000 Marudai Food Co. Ltd. JP 18,902
6,000 Guinness Anchor Berhad MY 13,268
35,000 Yeo Hiap Seng Berhad MY 78,791
* 400 Unicer-Uniao Cervejeira SA
(Registered Shares) PT 6,841
1,346 Foodcorp Ltd. SA 9,804
11,000 GP Batteries International Ltd.
(U.S. Dollar Shares) SG 32,450
* 2,000 Dongwon Industries Co. SK 24,888
3,410 LG International Corp. SK 23,702
* 3,000 Sam Yang Co. Ltd. SK 76,009
9,100 Saha Pathana Inter-Holding
Public Co. Ltd.
(Foreign Registered) TH 20,904
-----------
696,155
-----------
CONSUMER SERVICES 1.9%
22,400 PMP Communications Ltd. AU 54,362
* 18,200 Sydney Harbour Casino
Holdings Ltd. AU 30,677
66,000 South China Morning Post
(Holdings) Ltd. HK 56,657
2,600 Grammy Entertainment Public
Co. Ltd. (Foreign Registered) TH 34,242
-----------
175,938
-----------
ENERGY 4.8%
20,100 Caltex Australia Ltd. AU 68,544
4,500,000 Distribuidora de Produtos de
Petroleo Ipiranga SA (Preferred) BR 69,420
5,300,000 Petrobras Distribuidora SA
(Preferred) BR 99,708
350 ESSO SA FR 31,521
2,000 Itochu Fuel Co. Ltd. JP 9,435
2,000 Kamei Corp. JP 17,484
* 46,300 Bangchak Petroleum Public Co.
Ltd. (Foreign Registered) TH 31,020
78,400 Petrol Ofisi AS TU 17,059
230,100 Turcas Petroculuk AS TU 14,086
12,700 Frost Group (The) PLC UK 24,460
112,200 Premier Oil PLC UK 72,032
-----------
454,769
-----------
FINANCIAL SERVICES (BANKS) 15.0%
5,600 Bank of Melbourne Ltd. AU 40,641
19,400 Bank of Western Australia Ltd. AU 36,787
17,200 National Bank of Canada CN 200,737
15,300 Banco Industrial Colombiano CO 53,677
* 14,600 Investicni A Postovni Banka CZ 143,568
500 Compagnie Financiere de CIC et de
L'Union Europeenne FR 29,162
1,833 Alpha Credit Bank
(Registered Shares) GR 130,378
* 367 Alpha Credit Bank (Rights) GR 2,705
1,870 National Bank of Greece SA
(Registered Shares) GR 198,770
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
32
<PAGE> 35
FREMONT INTERNATIONAL SMALL CAP FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
FINANCIAL SERVICES (BANKS) (CONTINUED)
34,000 Kwong On Bank Ltd. HK $ 38,185
* 24,696 Union Bank of the Philippines PH 24,350
6,800 Banco Pinto & Sotto Mayor SA
(Registered Shares) PT 46,560
2,100 Banco Totta & Acores SA
(Registered Shares) PT 29,387
19,044 BPI-SGPS SA (Registered Shares) PT 287,771
* 45,000 Bangkok Bank of Commerce Public
Co. Ltd. (Foreign Registered) TH 13,955
84,600 First Bangkok City Bank
Public Co. Ltd.
(Foreign Registered) TH 70,446
45,400 Siam City Bank Public Co. Ltd.
(Foreign Registered) TH 36,935
677,000 Turkiye Garanti Bankasi AS TU 37,450
-----------
1,421,464
-----------
FINANCIAL SERVICES (OTHER) 8.5%
95,400 FAI Insurances Ltd. AU 46,901
2,400 London Insurance Group, Inc. CN 32,650
1,900 Suramericana de Seguros SA CO 46,749
2,750 Credit National FR 155,202
90,000 Liu Chong Hing Investment Ltd. HK 102,819
68,000 Peregrine Investment Holdings Ltd. HK 104,459
7,100 Irish Permanent PLC IR 66,030
15,000 Life Co. Ltd. JP 30,834
13,000 Nippon Shinpan Co. JP 37,473
* 14,000 Datuk Keramat Holdings Berhad MY 21,643
12,000 MBF Capital Berhad MY 17,786
300 KAS Associatie NV NL 18,304
2,800 Phatra Thanakit Public Co. Ltd.
(Foreign Registered) TH 5,414
12,600 Union Asia Finance Public Co. Ltd
(Foreign Registered) TH 13,025
4,200 Jardine Lloyd Thompson Group PLC UK 12,799
31,700 Man (E D & F) Group PLC UK 92,482
-----------
804,570
-----------
HEALTH CARE 0.4%
5,000 Kaken Pharmaceutical JP 20,871
1,979 South African Druggists Ltd. SA 16,572
-----------
37,443
-----------
MULTI-INDUSTRY 3.0%
* 250 Chargeurs International SA FR 14,795
28,000 Sime Darby Ltd. HK 30,181
9,700 Crean (James) PLC (Units) IR 32,010
2,000 Suntelephone Co. Ltd. JP 11,814
1,600 Internatio-Muller NV NL 46,467
12,000 Malbak Ltd. SA 19,424
10,000 Daewoo Corp. SK 65,359
8,900 Goode Durrant PLC UK 67,046
-----------
287,096
-----------
RAW MATERIALS 10.1%
* 29,120 Aluar Aluminio Argentina SA
(Class B) AR $ 98,440
1,400,000 Companhia Petroquimica de Sul BR 60,578
9,300,000 Fertilizantes Fosfatados SA
(Preferred) BR 40,328
37,500 Uniao de Industrias Petroquimicas
SA (Preferred B) BR 14,463
292,000 Shanghai Petrochemical Co. Ltd.
(Hong Kong Shares) CH 72,372
614,000 Yizheng Chemical Fibre Co. Ltd.
(Hong Kong Shares) CH 120,476
* 116 Sepap AS CZ 4,615
* 221 Synthesia AS CZ 1,260
400 Hellas Can Packaging SA GR 6,392
* 8,000 PT Chareon Pokphand Indonesia
(Foreign Registered) ID 8,066
31,000 Chuetsu Pulp & Paper Co. Ltd. JP 90,092
13,000 Cydsa SA (Series A) MX 31,077
* 36,000 Empaques Ponderosa SA
de CV (Series B) MX 22,511
4,800 Vitro SA MX 12,803
200 DSM NV NL 19,944
* 49,500 Dewan Salman Fibre Ltd. PK 42,235
* 7,897 Avgold Ltd. SA 12,676
6,700 Trans-Natal Coal Corp. Ltd. SA 43,306
2,050 Sunkyong Industries Ltd. SK 22,775
* 2,800 Empresa Nacional de Celulosas SA SP 46,713
* 15,800 Ercros SA SP 10,717
4,500 National Petrochemical Public
Co. Ltd. (Foreign Registered) TH 4,910
21,200 Tipco Asphalt Public Co. Ltd.
(Foreign Registered) TH 107,136
43,209 Cimentas Izmir Cimento
Fabrikasi Turk AS TU 5,896
*134,000 Petkim Petrokimya Holdings AS TU 51,394
-----------
951,175
-----------
RETAIL 7.0%
167,100 David Jones Ltd. AU 219,066
78,100 Davids Ltd. AU 75,572
36,000 Jardine International Motor
Holdings Ltd. HK 41,825
2,000 Oak & Co. JP 7,797
* 42,000 Controladora Comercial Mexicana
SA de CV (Units) MX 32,023
2,300 Macintosh NV NL 46,935
1,674 Ellerine Holdings Ltd. SA 10,538
4,532 New Clicks Holdings Ltd. SA 5,196
12,700 East Asiatic Public Co.
Ltd. (Local Shares) TH 11,061
42,100 Kwik Save Group PLC UK 206,986
1,600 Lex Service PLC UK 9,167
-----------
666,166
-----------
SHELTER 13.9%
700 Bau Holdings AG (Preferred) AS 37,624
5,000 Brasilit SA BR 6,585
* 616 Inzenyrske a Prumyslove Stavby AS CZ 4,683
212,400 Century City International
Holdings Ltd. HK 74,715
</TABLE>
*Non-income producing securities
The accompanying notes are an integral part of these financial statements.
33
<PAGE> 36
FREMONT INTERNATIONAL SMALL CAP FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
SHELTER (CONTINUED)
134,000 Hon Kwok Land Investment Ltd. HK $ 44,975
89,000 Kumagai Gumi Ltd. HK 96,507
281,500 Tai Cheung Holdings Ltd. HK 223,482
66,000 Daikyo, Inc. JP 205,324
100 Daito Trust Construction Co. Ltd. JP 1,008
99,000 Fujita Corp. JP 152,044
4,400 Kawasho Gecoss Corp. JP 30,981
6,000 Mitsui Wood Systems, Inc. JP 40,167
10,000 Nichiei Construction JP 55,761
8,000 SXL Corp. JP 45,113
70,000 Bandar Raya Developments Berhad MY 103,195
1,100 Koninklijke BAM Groep NV NL 68,868
880 Sungwon Construction Co. SK 8,287
29,900 Persimmon PLC UK 118,818
-----------
1,318,137
-----------
TECHNOLOGY 0.1%
1,100 Alphatec Electronics Public
Co. Ltd. (Foreign Registered) TH 4,169
-----------
4,169
-----------
TRANSPORTATION 2.6%
1,000 Compagnie Maritime Belge SA BE 71,729
5,000 Nippon Konpo Unyu Soko JP 29,338
2,000 Koninklijke Nedlloyd Groep NV NL 45,953
25,000 Hai Sun Hup Group Ltd. SG 17,799
* 7,500 Hai Sun Hup Group Ltd.
(Warrants 12/31/01) SG 389
37,000 Neptune Orient Lines Ltd. SG 31,202
* 2,000 Hanjin Shipping Co. SK 45,067
-----------
241,477
-----------
UTILITIES 4.0%
3,100 Telecom de Argentina SA (Class B) AR 15,502
* 741 Ceske Energeticke Zavody AS CZ 23,106
* 322 SPT Telecom AS CZ 34,059
* 92,000 Pakistan Telecommunications Corp. PK 57,214
1,200 Electricas Reunidas de Zaragoza SA SP 41,109
1,000 Electricity Generating Public
Co. Ltd. (Foreign Registered) TH 2,680
29,600 Jasmine International Public
Co. Ltd. (Foreign Registered) TH 41,363
20,300 Northern Ireland Electricity PLC UK 131,974
4,860 Wessex Water PLC UK 29,424
-----------
376,431
-----------
TOTAL STOCKS (COST $9,881,361) 9,266,623
-----------
</TABLE>
<TABLE>
<CAPTION>
Country Value
Face Amount/Issuer Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
SHORT TERM SECURITIES 1.0%
95,983 Benchmark Diversified
Assets Fund US $ 95,983
-----------
TOTAL SHORT TERM SECURITIES (COST $95,983) 95,983
-----------
TOTAL INVESTMENTS (COST $9,977,344), 99.0% 9,362,606
OTHER ASSETS AND LIABILITIES, NET, 1.0% 97,717
-----------
NET ASSETS, 100.0% $ 9,460,323
===========
</TABLE>
COUNTRY DIVERSIFICATION
<TABLE>
<CAPTION>
Country % of
Code Country Name Net Assets
- --------------------------------------------------------------
<S> <C> <C>
AR Argentina 1.6%
AS Austria 0.4%
AU Australia 6.9%
BE Belgium 0.8%
BR Brazil 6.6%
CH China 2.0%
CN Canada 3.6%
CO Colombia 1.1%
CZ Czech Republic 2.5%
FI Finland 0.5%
FR France 4.3%
GR Greece 3.8%
HK Hong Kong 10.0%
ID Indonesia 0.2%
IR Ireland 1.1%
JP Japan 15.1%
MX Mexico 1.0%
MY Malaysia 2.1%
NL Netherlands 5.0%
NO Norway 0.1%
NZ New Zealand 0.4%
PH Philippines 0.3%
PK Pakistan 1.0%
PT Portugal 4.0%
SA South Africa 1.5%
SG Singapore 2.0%
SK South Korea 5.6%
SP Spain 1.0%
TH Thailand 4.4%
TU Turkey 1.6%
UK United Kingdom 8.7%
US United States 0.8%
-----
100.0%
=====
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
34
<PAGE> 37
FREMONT EMERGING MARKETS FUND
April 30, 1997 (Unaudited)
STATEMENT OF INVESTMENTS
IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
STOCKS 80.5%
CAPITAL GOODS 6.0%
13,000 Usinas Siderurgicas de
Minas Gerais SA, ADR BR $ 152,792
* 12,000 Mahindra & Mahindra Ltd., GDR IN 150,000
35,000 IJM Corp. Berhad MY 76,699
65,000 Leader Universal Holdings Berhad MY 129,492
------------
508,983
------------
CONSUMER DURABLES 0.9%
635,000 Arcelik AS TU 76,108
------------
76,108
------------
CONSUMER NON-DURABLES 7.1%
160,000 Guangnan Holdings HK 230,295
150,000 PT Davomas Abadi
(Foreign Registered) ID 188,272
* 125,000 PT Daya Guna Samudera
(Foreign Registered) ID 181,327
------------
599,894
------------
CONSUMER SERVICES 4.4%
* 5,500 Grupo Televisa SA, GDR MX 127,188
30,000 Leisure Management Berhad MY 130,289
30,000 Tanjong PLC MY 108,774
------------
366,251
------------
FINANCIAL SERVICES 11.4%
10,000 Banco de Galicia y Buenos Aires
SA de CV, ADR AR 243,281
7,500 Banco Frances del Rio de la
Plata SA, ADR AR 227,813
50,000 Public Finance Berhad
(Foreign Registered) MY 76,500
3,000,000 Yapi ve Kredi Bankasi AS TU 126,125
* 154,000 Chinatrust Commercial Bank TW 289,516
------------
963,235
------------
HEALTH CARE 2.2%
7,500 Ranbaxy Laboratories Ltd., GDR IN 186,563
------------
186,563
------------
MULTI-INDUSTRY 4.4%
40,000 China Resources Enterprise Ltd. HK 110,500
* 430,000 Fairyoung Holdings Ltd. HK 181,789
6,200 Sasol Ltd. SA 79,451
------------
371,740
------------
RAW MATERIALS 1.9%
20,000 Vitro SA, ADR MX 162,500
------------
162,500
------------
RETAIL 2.0%
* 5,500 Disco SA, ADR AR 170,500
------------
170,500
------------
SHELTER 9.3%
133,000 Lai Sun Development Co. Ltd. HK 162,245
* 26,693 Lai Sun Hotels Intl Ltd.
(Warrants 04/03/99) HK 2,550
20,000 New World Development Co. Ltd. HK 115,405
* 200,000 PT Jakarta International Hotels
& Development
(Foreign Registered) ID 179,012
*1,000,000 Robinson's Land Corp. (Series B) PH 144,103
* 61,000 Kingdom Construction Co. Ltd. TW 176,428
------------
779,743
------------
TECHNOLOGY 9.2%
1,600,000 Techtronic Industries Co. HK $ 270,570
20,000 KCE Electronics Public Co. Ltd.
(Foreign Registered) TH 71,593
* 69,000 Compal Electronics TW 271,909
* 27,000 Hon Hai Precision Industry TW 158,134
------------
772,206
------------
TRANSPORTATION 2.5%
* 215,000 Road King Infrastructure Ltd. HK 212,319
------------
212,319
------------
UTILITIES 19.2%
8,500 Centrais Electricas
Brasileiras SA, ADR BR 198,605
* 15,000 Multicanal Participacoes SA, ADR BR 217,500
4,500 Telecomunicacoes
Brasileiras SA, ADR BR 516,375
700,000 Telecomunicacoes de Sao Paulo SA BR 198,859
* 175,000 Beijing Datang Power
Generation Co. Ltd. CH 90,927
55,000 Hong Kong Electric Holdings Ltd. HK 194,537
* 9,000 Grupo Iusacell SA (Series L), ADR MX 102,375
2,500 Mosenergo, ADR RU 98,525
------------
1,617,703
------------
TOTAL STOCKS (COST $6,246,314) 6,787,745
------------
</TABLE>
<TABLE>
<CAPTION>
Value
Face Amount/Issuer/Discount Rate/Stated Maturity (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
SHORT TERM SECURITIES 14.7%
300,318 Benchmark Diversified Assets Fund US 300,318
935,000 Federal National Mortgage
Association, DN, 5.380%, 05/02/97 US 934,860
------------
TOTAL SHORT TERM SECURITIES (COST $1,235,178) 1,235,178
------------
TOTAL INVESTMENTS (COST $7,481,492), 95.2% 8,022,923
OTHER ASSETS AND LIABILITIES, NET, 4.8% 402,899
------------
NET ASSETS, 100.0% $ 8,425,822
============
</TABLE>
PORTFOLIO ABBREVIATIONS:
ADR - American Depository Receipt
DN - Discount Note
GDR - Global Depository Receipt
COUNTRY DIVERSIFICATION
<TABLE>
<CAPTION>
Country % of
Code Country Name Net Assets
- --------------------------------------------------------------------------------
<S> <C> <C>
AR Argentina 7.6%
BR Brazil 15.5%
CH China 1.1%
HK Hong Kong 17.6%
ID Indonesia 6.5%
IN India 4.0%
MX Mexico 4.7%
MY Malaysia 6.2%
PH Philippines 1.7%
RU Russia 1.2%
SA South Africa 0.9%
TH Thailand 0.9%
TU Turkey 2.4%
TW Taiwan 10.7%
US United States 19.0%
-----
TOTAL 100.0%
=====
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
35
<PAGE> 38
FREMONT U.S. MICRO-CAP FUND
April 30, 1997 (Unaudited)
STATEMENT OF INVESTMENTS
IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
STOCKS 85.4%
BUSINESS EQUIPMENT & SERVICES 14.5%
*209,500 BTG, Inc. $ 3,142,500
*189,900 First Aviation Services, Inc. 1,614,150
* 65,000 Mail Boxes Etc. 1,202,500
*296,700 MDSI Mobile Data Solutions, Inc. 4,932,637
*190,200 NuCO2, Inc. 2,615,250
*382,600 Richey Electronics, Inc. 3,873,825
*244,700 Specialty Teleconstructors, Inc. 2,385,825
* 30,000 Ultrak, Inc. 322,500
-----------
20,089,187
-----------
CAPITAL GOODS 4.1%
*114,600 Adept Technology, Inc. 737,737
* 81,200 AFC Cable Systems, Inc. 1,786,400
*116,400 Channell Commercial Corp. 1,222,200
*156,100 Gradall Industries, Inc. 1,912,225
-----------
5,658,562
-----------
CONSUMER DURABLES 0.6%
* 74,600 Diamond Home Services, Inc. 839,250
-----------
839,250
-----------
CONSUMER NON-DURABLES 7.0%
* 82,200 Conso Products Co. 1,119,975
66,500 Culp, Inc. 1,180,375
*113,700 Fresh America Corp. 1,591,800
*156,100 Genesco, Inc. 1,814,662
* 13,450 Sonic Corp. 178,213
*130,800 Sport-Haley, Inc. 2,125,500
*172,500 Styling Technology Corp. 1,595,625
-----------
9,606,150
-----------
CONSUMER SERVICES 6.8%
*144,000 Damark International, Inc. (Class A) 1,332,000
*337,700 LodgeNet Entertainment Corp. 3,039,300
* 17,100 Prepaid Legal Services, Inc. 243,675
*233,812 Saga Communications, Inc. (Class A) 4,120,936
* 62,800 ShoLodge, Inc. 690,800
-----------
9,426,711
-----------
ENERGY 6.1%
*194,200 Basin Exploration, Inc. 1,286,575
* 73,000 Cairn Energy USA, Inc. 812,125
200,400 Lomak Petroleum, Inc. 3,381,750
* 15,800 Trico Marine Services, Inc. 560,900
140,500 Wiser Oil Co. 2,335,812
-----------
8,377,162
-----------
FINANCIAL SERVICES 9.1%
* 75,000 Bank Plus Corp. 740,625
* 70,100 Credit Management Solutions, Inc. 630,900
81,600 GA Financial, Inc. 1,285,200
123,000 ISB Financial Corp. $ 2,767,500
171,100 PennFed Financial Services, Inc. 4,063,625
127,700 R&G Financial Corp. (Class B) 2,992,969
-----------
12,480,819
-----------
HEALTH CARE 5.9%
*238,000 AccuMed International, Inc. 758,625
*101,750 Advance Paradigm, Inc. 1,157,406
*318,200 American Healthcorp, Inc. 3,182,000
* 22,700 Gensia, Inc. 79,450
* 40,500 MIM Corp. 359,438
* 54,100 Sabratek Corp. 1,183,437
*102,600 Wesley Jessen VisionCare, Inc. 1,410,750
-----------
8,131,106
-----------
RAW MATERIALS 0.7%
141,500 Northern Technologies International 937,438
-----------
937,438
-----------
RETAIL 1.9%
*208,100 Garden Ridge Corp. 1,690,813
*158,800 New West Eyeworks, Inc. 913,100
-----------
2,603,913
-----------
SHELTER 1.4%
200,216 D.R. Horton, Inc. 1,952,106
-----------
1,952,106
-----------
TECHNOLOGY (COMPONENTS) 14.0%
*441,300 Aware, Inc. 4,633,650
*394,300 Ceradyne, Inc. 1,872,925
* 94,700 Datum, Inc. 2,201,775
*185,700 Interlink Electronics, Inc. 951,713
*147,600 Micrel, Inc. 6,457,500
*218,100 PCD, Inc. 3,216,975
-----------
19,334,538
-----------
TECHNOLOGY (EQUIPMENT) 7.2%
*130,900 Applied Signal Technology, Inc. 572,688
* 58,400 PRI Automation, Inc. 2,993,000
* 56,900 Speedfam International, Inc. 1,379,825
*151,200 Thermedics Detection, Inc. 1,493,100
*353,400 World Access, Inc. 3,445,650
-----------
9,884,263
-----------
TECHNOLOGY (SOFTWARE) 5.3%
* 5,600 Geoworks 40,600
*239,800 ISG International Software Group Ltd. 2,487,925
*214,900 Template Software, Inc. 1,799,788
*615,400 V-One Corp. 3,077,000
-----------
7,405,313
-----------
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
36
<PAGE> 39
FREMONT U.S. MICRO-CAP FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
TRANSPORTATION 0.8%
*120,000 Smithway Motor Express Corp.
(Class A) $ 1,050,000
------------
1,050,000
------------
TOTAL STOCKS (COST $124,672,873) 117,776,518
------------
</TABLE>
<TABLE>
<CAPTION>
Value
Face Amount/Issuer/Discount Rate/Stated Maturity (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
SHORT TERM SECURITIES 11.8%
1,377,806 Benchmark Diversified Assets Fund $ 1,377,806
5,000,000 Honeywell, Inc., CP, 5.600%,
05/01/97 5,000,000
5,000,000 Merrill Lynch & Co., Inc., CP,
5.550%, 05/02/97 4,999,229
5,000,000 RTZ America, Inc., CP, 5.530%,
05/01/97 5,000,000
------------
TOTAL SHORT TERM SECURITIES (COST $16,377,035) 16,377,035
------------
TOTAL INVESTMENTS (COST $141,049,908), 97.2% 134,153,553
OTHER ASSETS AND LIABILITIES, NET, 2.8% 3,828,111
------------
NET ASSETS, 100.0% $137,981,664
============
PORTFOLIO ABBREVIATIONS:
CP - Commercial Paper
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
37
<PAGE> 40
FREMONT GROWTH FUND
April 30, 1997 (Unaudited)
STATEMENT OF INVESTMENTS
IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
STOCKS 94.4%
BUSINESS EQUIPMENT & SERVICES 1.4%
6,500 Omnicom Group, Inc. $ 344,500
43,600 WMX Technologies, Inc. 1,280,750
------------
1,625,250
------------
CAPITAL GOODS 2.7%
11,100 Caterpillar, Inc. 987,900
15,500 Emerson Electric Co. 786,625
4,700 Hughes Supply, Inc. 155,687
9,345 Mark IV Industries, Inc. 217,271
13,500 PACCAR, Inc. 943,312
------------
3,090,795
------------
CONSUMER DURABLES 3.3%
18,700 Chrysler Corp. 561,000
28,400 Ford Motor Co. 986,900
21,800 General Motors Corp. 1,261,675
20,200 Goodyear Tire & Rubber Co. 1,063,025
------------
3,872,600
------------
CONSUMER NON-DURABLES 0.8%
17,500 American Brands, Inc. 940,625
------------
940,625
------------
CONSUMER SERVICES 1.8%
12,100 Gannett Co., Inc. 1,055,725
22,800 Tribune Co. 1,000,350
------------
2,056,075
------------
ENERGY 16.3%
19,400 Amoco Corp. 1,622,325
7,900 Atlantic Richfield Co. 1,075,387
32,000 Chevron Corp. 2,192,000
15,100 Devon Energy Corp. 498,300
* 10,400 ENSCO International, Inc. 494,000
54,500 Exxon Corp. 3,086,062
15,700 Kerr-McGee Corp. 947,888
17,500 Mobil Corp. 2,275,000
33,000 Occidental Petroleum Corp. 730,125
15,900 Phillips Petroleum Co. 626,062
6,000 Schlumberger Ltd. 664,500
22,400 Tenneco, Inc. 893,200
15,500 Texaco, Inc. 1,635,250
13,200 Tidewater, Inc. 529,650
22,800 Unocal Corp. 869,250
27,900 X-Marathon Group 770,738
------------
18,909,737
------------
FINANCIAL SERVICES (BANKS) 12.7%
21,700 Ahmanson (H.F.) & Co. 827,312
19,100 Banc One Corp. 809,363
11,800 BankAmerica Corp. 1,379,125
10,000 Bankers Trust New York Corp. 813,750
15,700 Citicorp 1,768,212
16,700 First Chicago NBD Corp. $ 939,375
25,500 First Hawaiian, Inc. 784,125
10,300 First Union Corp. 865,200
11,200 Mellon Bank Corp. 931,000
5,000 Morgan (J.P.) & Co., Inc. 509,375
24,600 NationsBank Corp. 1,485,225
18,400 Norwest Corp. 917,700
12,800 Republic New York Corp. 1,172,800
22,600 Suntrust Banks, Inc. 1,146,950
3,100 Zions Bancorporation 392,150
------------
14,741,662
------------
FINANCIAL SERVICES (OTHER) 8.7%
22,300 Allstate Corp. 1,460,650
18,000 American Express Co. 1,185,750
26,600 Dean Witter, Discover & Co. 1,017,450
31,600 Federal Home Loan Mortgage Corp. 1,007,250
8,000 General Re Corp. 1,338,000
9,900 Horace Mann Educators Corp. 464,063
9,300 Mercury General Corp. 576,600
4,800 Price (T. Rowe) Associates 222,000
26,500 Travelers Group, Inc. 1,467,438
26,900 USLIFE Corp. 1,304,650
------------
10,043,851
------------
HEALTH CARE 5.5%
16,800 Aetna, Inc. 1,530,900
* 4,900 Biogen, Inc. 156,800
37,000 Columbia HCA Healthcare Corp. 1,295,000
* 4,700 HealthCare COMPARE Corp. 203,863
7,500 Medtronic, Inc. 519,375
* 18,800 NovaCare, Inc. 213,850
* 2,300 PacifiCare Health Systems, Inc.
(Class B) 184,575
38,900 Pharmacia & Upjohn, Inc. 1,152,412
* 12,300 Sola International, Inc. 307,500
8,600 Warner-Lambert Co. 842,800
------------
6,407,075
------------
MULTI-INDUSTRY 1.4%
7,100 Minnesota Mining & Manufacturing Co. 617,700
19,000 TRW, Inc. 990,375
------------
1,608,075
------------
RAW MATERIALS 3.5%
17,000 Aluminum Co. of America 1,187,875
12,100 Dow Chemical Co. 1,026,988
47,200 Engelhard Corp. 991,200
22,400 Goodrich (B.F.) Co. 893,200
------------
4,099,263
------------
RETAIL 4.3%
* 13,900 CompUSA, Inc. 267,575
* 10,400 Consolidated Stores Corp. 416,000
* 30,100 Federated Department Stores, Inc. 1,023,400
15,000 Hannaford Brothers Co. 478,125
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
38
<PAGE> 41
FREMONT GROWTH FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
RETAIL (CONTINUED)
5,300 Lowe's Cos., Inc. $ 201,400
28,700 Penney (J.C.), Inc. 1,370,425
25,900 Sears, Roebuck and Co. 1,243,200
------------
5,000,125
------------
SHELTER 1.9%
13,300 Armstrong World Industries, Inc. 874,475
19,400 Kimberly-Clark Corp. 994,250
* 10,000 Owens-Illinois, Inc. 270,000
------------
2,138,725
------------
TECHNOLOGY 13.1%
27,400 Amp, Inc. 982,975
* 12,900 Applied Materials, Inc. 707,888
17,100 Boeing Co. 1,686,487
4,900 Harris Corp. 418,950
18,600 International Business Machines Corp. 2,989,950
* 18,500 Komag, Inc. 522,625
27,800 Motorola, Inc. 1,591,550
20,000 Rockwell International Corp. 1,330,000
* 12,600 Seagate Technology, Inc. 578,025
11,800 Texas Instruments, Inc. 1,053,150
4,400 Thiokol Corp. 287,100
* 20,900 Ultratech Stepper, Inc. 374,894
11,500 United Technologies Corp. 869,688
19,600 Xerox Corp. 1,205,400
* 12,100 Xilinx, Inc. 592,900
------------
15,191,582
------------
TRANSPORTATION 3.9%
* 16,300 AMR Corp. 1,517,937
13,100 Burlington Northern Sante Fe 1,031,625
6,622 Conrail, Inc. 756,564
14,700 Union Pacific Corp. 937,125
* 15,600 Yellow Corp. 300,300
------------
4,543,551
------------
UTILITIES 13.1%
* 87,300 AirTouch Communications, Inc. 2,226,150
25,800 Ameritech Corp. 1,577,025
19,700 Bell Atlantic Corp. 1,334,675
39,000 BellSouth Corp. 1,735,500
18,600 Coastal Corp. 883,500
44,300 Entergy Corp. 1,035,513
35,800 GPU, Inc. 1,154,550
21,700 NYNEX Corp. 1,122,975
51,500 PG&E Corp. 1,236,000
12,500 SBC Communications, Inc. 693,750
26,600 Texas Utilities Co. 897,750
40,600 Unicom Corp. 883,050
10,900 Williams Cos., Inc. 478,237
------------
15,258,675
------------
TOTAL STOCKS (COST $99,986,029) 109,527,666
------------
</TABLE>
<TABLE>
<CAPTION>
Value
Face Amount/Issuer/Discount Rate/Stated Maturity (Note 1)
- --------------------------------------------------------------------------------
<S> <C>
SHORT TERM SECURITIES 5.0%
288,741 Benchmark Diversified Assets Fund $ 288,741
5,500,000 Honeywell, Inc., CP, 5.600%,
05/01/97 5,500,000
------------
TOTAL SHORT TERM SECURITIES (COST $5,788,741) 5,788,741
------------
TOTAL INVESTMENTS (COST $105,774,770), 99.4% 115,316,407
OTHER ASSETS AND LIABILITIES, NET, 0.6% 754,320
------------
NET ASSETS, 100.0% $116,070,727
============
PORTFOLIO ABBREVIATIONS:
CP - Commercial Paper
</TABLE>
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
39
<PAGE> 42
FREMONT BOND FUND
April 30, 1997 (Unaudited)
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Coupon Maturity Value
Principal Issuer Rate Date (Note 1)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
BONDS 87.9%
FIXED RATE AND ADJUSTABLE RATE MORTGAGE SECURITIES 38.1%
427,715 FHLMC............................................................ 6.500% 01/01/26 $ 404,857
192,864 FHLMC............................................................ 6.500% 03/01/26 182,557
1,101,327 FHLMC............................................................ 6.500% 04/01/26 1,042,472
221,872 FHLMC............................................................ 6.500% 05/01/26 210,015
602,900 FHLMC............................................................ 8.250% 08/01/17 623,429
724,896 FNMA............................................................. 8.500% 05/01/25 749,129
935,759 FNMA ARM......................................................... 7.950% 11/01/23 972,459
2,215,202 GNMA............................................................. 7.000% 01/15/26 2,143,902
7,487,584 GNMA............................................................. 7.000% 02/15/26 7,246,581
3,500,000 GNMA TBA......................................................... 8.500% 07/21/27 3,597,335
3,014,975 GNMA II ARM...................................................... 6.000% 11/20/26 3,005,297
599,409 GNMA II ARM...................................................... 6.875% 11/20/24 611,860
4,284,405 GNMA II ARM...................................................... 7.000% 08/20/25 4,364,224
3,355,582 GNMA II ARM...................................................... 7.125% 08/20/23 3,437,666
-----------
28,591,783
-----------
COLLATERALIZED MORTGAGE OBLIGATIONS 31.5%
550,421 Collateralized Mortgage Securities Corp. CMO, J-5Z, REMIC........ 7.985% 05/01/17 558,413
1,564,962 FHLMC CMO, 1018 0Z, PAC-1 (11) REMIC............................. 7.000% 11/15/20 1,511,785
383,110 FNMA CMO, 1990-53G, PAC REMIC.................................... 8.000% 12/25/18 385,742
15,000,000 FNMA CMO, 1992-131KA, PAC(11) REMIC.............................. 8.000% 01/25/22 15,436,260
200,000 FNMA CMO, 1993-11J, PAC REMIC.................................... 7.500% 02/25/08 201,645
1,000,000 Morgan Stanley Mortgage Trust CMO, 40-8, PAC (11) REMIC.......... 7.000% 07/20/21 966,636
393,190 Resolution Trust Corp. CMO, 1992-M4 A1 REMIC..................... 8.000% 09/25/21 395,279
849,600 Ryland Mortgage Securities Corp. CMO, 1993-8-A, REMIC ........... 7.899% 09/25/23 861,813
468,420 Saxon Mortgage Securities Corp. CMO, 1992-1 A1, ARM REMIC........ 7.633% 09/25/22 473,983
3,500,000 Securitized Asset Sales, Inc. CMO, 1993-2A9, PAC (11) REMIC...... 6.200% 07/25/08 2,864,040
-----------
23,655,596
-----------
CORPORATE BONDS 10.6%
260,000 CMS Energy Corp. (Callable 10/01/97 @ 101.65).................... 9.875% 10/01/99 267,587
870,000 Delta Air Lines, Inc. (Sinking Fund Bond)........................ 9.450% 02/14/06 949,692
1,749,000 Delta Air Lines, Inc. (Sinking Fund Bond)........................ 9.450% 02/26/06 1,909,995
500,000 Salomon, Inc..................................................... 6.625% 02/17/98 500,620
2,000,000 Time Warner, Inc................................................. 7.450% 02/01/98 2,011,140
225,000 Time Warner, Inc................................................. 7.975% 08/15/04 228,623
450,000 Time Warner, Inc................................................. 8.110% 08/15/06 458,455
450,000 Time Warner, Inc................................................. 8.180% 08/15/07 459,351
1,000,000 United Airlines.................................................. 10.670% 05/01/04 1,155,162
-----------
7,940,625
-----------
FOREIGN BONDS 7.4%
CAN$ 2,293,000 Government of Canada............................................. 8.500% 03/01/00 1,772,866
NZ$ 1,500,000 Government of New Zealand........................................ 8.000% 04/15/04 1,043,640
NZ$ 1,300,000 Government of New Zealand........................................ 10.000% 03/15/02 980,417
US$ 1,940,000 Republic of Argentina, FRN
(Callable Semiannually in March or September @ 100)............. 6.750% 03/31/05 1,779,950
-----------
5,576,873
-----------
STRIPPED MORTGAGE SECURITIES 0.3%
3,084,018 FNMA Interest Only, 1994-27WB, PAC-1 REMIC....................... 6.500% 06/25/14 144,141
90,614 FNMA Principal Only, G93-12B, PAC (11) REMIC..................... 0.000% 02/25/23 88,490
-----------
232,631
-----------
TOTAL BONDS (COST $65,315,458) 65,997,508
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
40
<PAGE> 43
FREMONT BOND FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Discount Maturity Value
Principal Issuer Rate Date (Note 1)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
OTHER SECURITIES 1.4%
20,000 Long Island Lighting Co. (Convertible Preferred Stock).................................... $ 502,500
7,800,000 Call Option on U.S. Treasury Note, 6.250%, 05/31/00,
Strike @ 91.875000, Exp. 05/08/97........................................................ 595,140
-----------
TOTAL OTHER SECURITIES (Cost $1,097,507) 1,097,640
-----------
SHORT TERM SECURITIES 18.5%
665,071 Benchmark Diversified Assets Fund......................................................... 665,071
* 1,300,000 Texas Gas Transmission Corp., MTN................................ 9.625% 07/15/97 1,309,739
700,000 Canadian Wheat Board, CP......................................... 5.550% 06/30/97 693,525
3,500,000 Ford Motor Credit Corp., CP ..................................... 5.550% 05/05/97 3,497,842
400,000 General Electric Capital Corp., CP............................... 5.530% 05/16/97 399,078
1,200,000 General Electric Capital Corp., CP............................... 5.550% 06/18/97 1,191,120
**1,400,000 Mobil Australia Finance Co., CP ................................. 5.490% 05/15/97 1,397,011
1,800,000 National Rural Utilities Cooperative Finance Corp., CP........... 5.530% 05/23/97 1,793,917
2,000,000 New Center Asset Trust, CP....................................... 5.580% 06/25/97 1,982,950
600,000 Western Australian Treasury Corp., CP............................ 5.400% 06/18/97 595,680
+ 90,000 U.S. Treasury Bill............................................... 5.080% 06/26/97 89,289
+ 150,000 U.S. Treasury Bill............................................... 5.090% 06/26/97 148,812
+ 10,000 U.S. Treasury Bill............................................... 5.110% 07/03/97 9,911
+ 65,000 U.S. Treasury Bill............................................... 5.150% 07/03/97 64,414
+ 10,000 U.S. Treasury Bill............................................... 5.220% 07/03/97 9,909
+ 15,000 U.S. Treasury Bill............................................... 5.220% 07/03/97 14,864
+ 10,000 U.S. Treasury Bill............................................... 5.250% 07/03/97 9,908
-----------
TOTAL SHORT TERM SECURITIES (Cost $13,873,040) 13,873,040
-----------
TOTAL INVESTMENTS (Cost $80,286,005), 107.8% 80,968,188
OTHER ASSETS AND LIABILITIES, NET, (7.8)% (5,868,148)
-----------
NET ASSETS, 100.0% $75,100,040
===========
</TABLE>
PORTFOLIO ABBREVIATIONS:
ARM - Adjustable Rate Mortgage
CMO - Collateralized Mortgage Obligation
CP - Commercial Paper
FHLMC - Federal Home Loan Mortgage Corp.
FNMA - Federal National Mortgage Association
FRN - Floating Rate Note
GNMA - Government National Mortgage Association
MTN - Medium Term Note
PAC - Planned Amortization Class
REMIC - Real Estate Mortgage Investment Conduit
TBA - To Be Announced
CURRENCY ABBREVIATIONS:
CAN$ - Canadian Dollar
NZ$ - New Zealand Dollar
US$ - US Dollar
* The rate indicated for this security is the stated coupon rate.
** These securities are generally issued to institutional investors. Any resale
must be in an exempt transaction pursuant to Section 4(2) of the Securities
Act of 1933.
+ On deposit with broker for initial margin on futures contracts (Note 1).
The accompanying notes are an integral part of these financial statements.
41
<PAGE> 44
FREMONT MONEY MARKET FUND
April 30, 1997 (Unaudited)
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Discount Maturity Value
Principal Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER 88.3%
5,000,000 AT&T Corp................................................. 5.490% 05/30/97 $ 4,977,887
5,000,000 A.I. Credit Corp.......................................... 5.550% 07/07/97 4,948,354
5,000,000 Abbey National North America Corp......................... 5.400% 07/15/97 4,943,750
5,000,000 Air Products and Chemicals, Inc........................... 5.330% 05/14/97 4,990,376
5,000,000 Allianz of America Finance Corp.*......................... 5.600% 07/21/97 4,937,000
5,000,000 American Express Credit Corp.............................. 5.520% 06/02/97 4,975,467
5,000,000 American General Finance Corp............................. 5.600% 07/01/97 4,952,556
5,000,000 Associates Corp. of North America......................... 5.550% 06/19/97 4,962,229
5,000,000 Australian Wheat Board.................................... 5.590% 07/07/97 4,947,982
5,000,000 Avco Financial Services, Inc.............................. 5.300% 05/28/97 4,980,125
5,000,000 B.A.T. Capital Corp....................................... 5.500% 05/20/97 4,985,486
5,000,000 BancOne Corp.*............................................ 5.500% 05/15/97 4,989,306
5,000,000 BellSouth Telecommunications, Inc......................... 5.510% 06/18/97 4,963,267
5,000,000 Boral Industries, Inc..................................... 5.500% 05/12/97 4,991,597
5,000,000 British Columbia, Province of............................. 5.350% 07/28/97 4,934,611
5,000,000 BTR Dunlop Finance, Inc.*................................. 5.380% 07/03/97 4,952,925
5,000,000 C.I.T. Group Holdings, Inc................................ 5.370% 06/16/97 4,965,692
5,000,000 Caisse d'Amortissement de la Dette Sociale................ 5.320% 05/02/97 4,999,261
5,000,000 Canadian Wheat Board...................................... 5.340% 06/03/97 4,975,525
5,000,000 Carolina Power & Light Co................................. 5.490% 05/19/97 4,986,275
5,000,000 Coca-Cola Co.*............................................ 5.500% 07/09/97 4,947,292
5,000,000 Commonwealth Bank of Australia............................ 5.370% 06/17/97 4,964,946
5,000,000 CPC International, Inc.*.................................. 5.560% 06/26/97 4,956,756
5,000,000 Daimler-Benz North America Corp........................... 5.320% 05/15/97 4,989,656
5,000,000 Dairy Investments (Bermuda) Ltd.*......................... 5.370% 06/06/97 4,973,150
5,000,000 Du Pont (E.I.) de Nemours & Co............................ 5.290% 06/25/97 4,959,590
5,000,000 Electricite de France..................................... 5.370% 07/22/97 4,938,842
5,000,000 Electricity Corp. of New Zealand Ltd...................... 5.500% 05/20/97 4,985,486
5,000,000 Elf Aquitaine Finance SA.................................. 5.600% 06/30/97 4,953,333
5,000,000 Exxon Imperial U.S., Inc.*................................ 5.510% 06/09/97 4,970,154
5,000,000 Gannett Co., Inc.*........................................ 5.500% 06/06/97 4,972,500
5,000,000 Gaz de France............................................. 5.490% 05/16/97 4,988,562
5,000,000 General Electric Capital Corp............................. 5.610% 07/23/97 4,935,329
5,000,000 Glaxo Wellcome PLC*....................................... 5.350% 06/05/97 4,973,993
5,000,000 Goldman Sachs & Co........................................ 5.340% 05/29/97 4,979,233
5,000,000 Great Lakes Chemical Corp.*............................... 5.400% 06/17/97 4,964,750
5,000,000 Guinness PLC*............................................. 5.650% 07/21/97 4,936,775
5,000,000 Halifax Building Society.................................. 5.280% 06/02/97 4,976,533
5,000,000 Heinz (H.J.) & Co......................................... 5.480% 05/21/97 4,984,778
5,000,000 Hershey Foods Corp........................................ 5.500% 06/10/97 4,969,444
5,000,000 Hitachi America Ltd....................................... 5.600% 09/22/97 4,888,000
2,600,000 Honeywell, Inc............................................ 5.600% 05/01/97 2,600,000
5,000,000 International Business Machines Credit Corp............... 5.560% 06/20/97 4,961,389
5,000,000 John Deere Capital Corp................................... 5.530% 05/27/97 4,980,031
5,000,000 Johnson Controls, Inc..................................... 5.510% 05/14/97 4,990,051
5,000,000 Kaiser Foundation Hospitals............................... 5.350% 07/02/97 4,953,931
5,000,000 Koch Industries, Inc.*.................................... 5.490% 05/13/97 4,990,850
5,000,000 Lucent Technologies, Inc.................................. 5.280% 05/15/97 4,989,733
5,000,000 Marsh & McLennan Cos., Inc.*.............................. 5.350% 05/06/97 4,996,285
5,000,000 MEC Finance USA, Inc...................................... 5.800% 05/29/97 4,977,444
5,000,000 Merrill Lynch & Co., Inc.................................. 5.350% 07/07/97 4,950,215
5,000,000 MetLife Funding, Inc...................................... 5.530% 06/11/97 4,968,510
5,000,000 Mitsubishi International Corp............................. 5.550% 06/13/97 4,966,854
5,000,000 Mitsui & Co. (U.S.A.), Inc................................ 5.620% 07/10/97 4,945,361
5,000,000 National Rural Utilities Cooperative Finance Corp......... 5.320% 05/08/97 4,994,828
4,600,000 PacTel Capital Resources*................................. 5.520% 05/12/97 4,592,241
5,000,000 Panasonic Finance, Inc.................................... 5.300% 05/09/97 4,994,111
5,000,000 Philip Morris Cos., Inc................................... 5.550% 07/08/97 4,947,583
</TABLE>
* These securities are generally issued to institutional investors. Any resale
must be in an exempt transaction pursuant to Section 4(2) of the Securities
Act of 1933.
The accompanying notes are an integral part of these financial statements.
42
<PAGE> 45
FREMONT MONEY MARKET FUND
April 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Discount Maturity Value
Principal Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER (CONTINUED)
5,000,000 Repsol International Finance BV........................... 5.380% 07/10/97 $ 4,947,694
5,000,000 Rexam PLC*................................................ 5.520% 06/12/97 4,967,800
5,000,000 Rockwell International Corp............................... 5.530% 06/17/97 4,963,901
5,000,000 RTZ America, Inc.*........................................ 5.570% 07/02/97 4,952,036
5,000,000 Rubbermaid, Inc.*......................................... 5.380% 05/28/97 4,979,825
5,000,000 Sara Lee Corp............................................. 5.520% 06/26/97 4,957,067
5,000,000 Sonoco Products Co........................................ 5.500% 05/06/97 4,996,181
5,000,000 Southern Co.*............................................. 5.570% 06/02/97 4,975,244
5,000,000 Spain, Kingdom of......................................... 5.350% 06/05/97 4,973,993
5,000,000 St. Paul Cos., Inc.*...................................... 5.470% 05/13/97 4,990,883
5,000,000 Stanford, Leland Junior University........................ 5.650% 10/06/97 4,876,014
5,000,000 Sweden, Kingdom of........................................ 5.670% 08/08/97 4,922,038
5,000,000 Swedish Export Credit Corp................................ 5.510% 06/09/97 4,970,154
5,000,000 Toronto Dominion Holdings USA, Inc........................ 5.280% 06/04/97 4,975,067
5,000,000 Toshiba International Finance PLC (UK).................... 5.350% 05/16/97 4,988,854
5,000,000 Toyota Motor Credit Corp.................................. 5.540% 06/18/97 4,963,067
5,000,000 Unilever Capital Corp.*................................... 5.520% 06/23/97 4,959,367
5,000,000 USAA Capital Corp......................................... 5.330% 05/20/97 4,985,935
5,000,000 Yale University........................................... 5.320% 05/07/97 4,995,567
------------
TOTAL COMMERCIAL PAPER 379,708,877
------------
OTHER SHORT TERM SECURITIES 11.7%
327,310 Benchmark Diversified Assets Fund................................................. 327,310
5,000,000 Bayerische Landesbank Girozentrale, Eurodollar Note + .... 7.750% 12/19/97 5,058,482
5,000,000 Berliner Handels-und Frankfurt Bank, Eurodollar TD + ..... 5.438% 05/05/97 5,000,000
5,000,000 Federal Farm Credit Banks Funding Corp., AN + ............ 5.900% 04/01/98 4,987,859
10,000,000 Federal Home Loan Bank, AN + ............................. 5.670% 06/27/97 10,002,914
10,000,000 Federal Home Loan Bank, AN + ............................. 5.700% 02/25/98 10,000,000
5,000,000 Federal Home Loan Bank, AN + ............................. 5.875% 03/24/98 5,000,000
5,000,000 Federal National Mortgage Association, DN ................ 5.570% 09/18/97 4,891,694
5,000,000 Student Loan Marketing Association, AN + ................. 5.630% 12/24/97 5,000,000
------------
TOTAL OTHER SHORT TERM SECURITIES 50,268,259
------------
TOTAL INVESTMENTS (Cost $429,977,136), 100.0% 429,977,136
OTHER ASSETS AND LIABILITIES, NET, 0.0% 82,557
------------
NET ASSETS, 100.0% $430,059,693
============
</TABLE>
PORTFOLIO ABBREVIATIONS:
AN - Agency Note
DN - Discount Note
TD - Time Deposit
* These securities are generally issued to institutional investors. Any resale
must be in an exempt transaction pursuant to Section 4(2) of the Securities
Act of 1933.
+ The rate indicated for these securities is the stated coupon rate.
The accompanying notes are an integral part of these financial statements.
43
<PAGE> 46
FREMONT CALIFORNIA INTERMEDIATE TAX-FREE FUND
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Coupon Maturity Value
Principal Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
MUNICIPAL BONDS 92.9%
1,000,000 City of Anaheim, Public Finance Authority Revenue Bond,
Anaheim Electric Utility Projects................................................. 5.600% 10/01/16 $ 976,260
1,000,000 California State Dept. of Veterans Affairs, Home Purchase Revenue 1991 Ser. A...... 6.450% 08/01/00 1,038,620
500,000 California State Dept. of Water Resources, Central Valley Project Revenue.......... 4.800% 12/01/07 486,430
1,000,000 California State Dept. of Water Resources, Central Valley Project Revenue Ser. H... 6.400% 12/01/00 1,066,760
1,000,000 California State GO, Various Purpose............................................... 6.500% 08/01/97 1,006,800
1,000,000 California State Public Works Board, Lease Revenue Dept. of Corrections,
Madera County State Prison 1990 Ser. A............................................ 6.700% 09/01/97 1,009,550
1,000,000 California State Public Works Board, Lease Revenue Dept. of Corrections, Prison D.. 5.100% 06/01/06 988,370
1,000,000 California State Public Works Board, Lease Revenue Refunding,
Trustees of The California State University, 1995 Ser. B.......................... 5.600% 04/01/06 1,018,920
1,000,000 Contra Costa Transportation Authority, Sales Tax Revenue 1991 Ser. A............... 6.400% 03/01/01 1,063,110
1,000,000 Contra Costa Water Authority, Water Treatment Revenue Refunding 1993 Ser. A
(FGIC Insured).................................................................... 5.300% 10/01/05 1,023,030
1,000,000 Contra Costa Water District, Water Revenue Ser. F (FGIC Insured)................... 5.250% 10/01/08 1,006,980
1,000,000 East Bay CA MUD, Water System Subordinated Revenue Ser. 1994....................... 8.500% 06/01/98 1,048,840
1,000,000 City of Fairfield, Water Revenue (AMBAC Insured)................................... 5.250% 04/01/14 961,470
1,225,000 City of Industry, Urban Development Agency Tax Allocation (MBIA Insured)........... 5.250% 05/01/12 1,181,868
1,000,000 City of Irvine, Assessment District No. 89-10, Limited Obligation
Refunding Improvement (MBIA Insured).............................................. 4.200% 09/02/05 926,820
1,000,000 City of Los Angeles, Convention & Exhibition Center Authority,
Lease Revenue Bonds Refunding Ser. A.............................................. 5.200% 08/15/09 991,060
1,000,000 City of Los Angeles, 1990 Solid Waste Collection Project COP Revenue............... 6.400% 11/01/97 1,012,830
1,000,000 City of Los Angeles, Wastewater System Revenue Ser. B (MBIA Insured)............... 5.700% 06/01/23 979,340
1,000,000 Los Angeles County Public Works Finance Authority, Lease Revenue Ser. B
(MBIA Insured).................................................................... 5.250% 09/01/09 992,760
750,000 Los Angeles County Sanitation District Finance Authority, 1993 Ser. A.............. 5.250% 10/01/06 759,892
1,000,000 Los Angeles Dept. of Water & Power, Electric Plant Revenue Refunding............... 5.500% 09/01/07 1,024,770
1,000,000 Los Angeles Dept. of Water & Power, Electric Plant Revenue......................... 4.700% 10/15/06 963,280
1,000,000 Los Angeles Dept. of Water & Power, Waterworks Revenue Refunding................... 5.625% 04/15/08 1,024,110
1,000,000 M-S-R Public Power Agency, San Juan Project Revenue Ser. F......................... 5.650% 07/01/03 1,044,580
1,000,000 Metropolitan Water District of Southern California,
Waterworks GO Refunding 1993 Ser. A............................................... 5.250% 03/01/05 1,020,850
1,000,000 Modesto High School District, 1993 GO Refunding (FGIC Insured)..................... 5.300% 08/01/04 1,026,850
1,000,000 Modesto Irrigation District Finance Authority,
Domestic Water Project Revenue 1992 Ser. A (AMBAC Insured)........................ 5.650% 09/01/03 1,045,620
1,000,000 Northern California Power Agency, Geothermal Project #3 Revenue Ser. A............. 5.600% 07/01/06 1,014,950
1,000,000 Orange County Transportation Authority,
Measure M Sales Tax Revenue First Ser. 1992....................................... 6.000% 02/15/06 1,063,040
1,000,000 Orange County Transportation Authority,
Measure M Sales Tax Revenue Second Senior Ser. 1994 (FGIC Insured)................ 5.000% 02/15/08 992,930
500,000 Orange County Water District, COP 1990 Project A................................... 6.500% 08/15/98 516,010
500,000 City of Pasadena, Electric Works Revenue Ser. 1990................................. 6.500% 08/01/99 523,065
500,000 City of Pasadena, GO Refunding Police and Jail Building 1993....................... 5.000% 06/01/07 491,245
1,000,000 Rancho Cucamonga RDA, 1994 Tax Allocation Refunding (MBIA Insured)................. 5.000% 09/01/07 990,790
1,000,000 City of Riverside, Electric Revenue 1991........................................... 6.100% 10/01/00 1,047,470
1,000,000 City of Riverside, Electric Revenue Refunding 1993................................. 5.000% 10/01/06 992,550
1,000,000 City of Riverside, Electric Revenue Refunding 1993 (AMBAC Insured)................. 5.000% 10/01/13 933,530
1,000,000 Sacramento County Sanitation District Finance Authority, Revenue Bond
(MBIA Insured).................................................................... 5.000% 12/01/08 983,140
1,000,000 Sacramento County Sanitation District Finance Authority, Revenue Bond
(MBIA Insured).................................................................... 5.125% 12/01/13 929,160
1,000,000 Sacramento MUD, Electric Revenue 1991 Ser. Y....................................... 6.250% 09/01/00 1,054,050
</TABLE>
44 The accompanying notes are an integral part of these financial statements.
<PAGE> 47
FREMONT CALIFORNIA INTERMEDIATE TAX-FREE FUND
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Coupon Maturity Value
Principal Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
MUNICIPAL BONDS (CONTINUED)
1,000,000 San Bernardino County Transportation Authority, Sales Tax Revenue 1992 Ser. A
(FGIC Insured).................................................................. 6.000% 03/01/03 $ 1,060,110
1,000,000 San Francisco, CA Bay Area Rapid Transit, Sales Tax Revenue Refunding............ 6.400% 07/01/97 1,004,370
1,000,000 City and County of San Francisco International Airport,
Revenue Second Ser. Issue 1 (AMBAC Insured)..................................... 6.100% 05/01/03 1,066,840
1,000,000 City and County of San Francisco RDA, Lease Revenue Ser. 1991
(George R. Moscone Convention Center) (AMBAC Insured)........................... 6.200% 10/01/00 1,052,790
1,000,000 City and County of San Francisco RDA, Tax Allocation 1997 Ser. B................. 5.700% 08/01/14 974,630
1,000,000 City and County of San Francisco Sewer, Revenue Refunding Ser. 1992
(AMBAC Insured)................................................................. 5.800% 10/01/05 1,053,790
1,000,000 City of San Jose, Finance Authority (Convention Center Refunding Project)
1993 Ser. C (MBIA Insured)...................................................... 5.750% 09/01/03 1,036,930
1,000,000 Santa Margarita/Dana Point Authority Orange County, Revenue Bond Ser. A.......... 5.375% 08/01/04 1,028,310
1,000,000 Santa Monica-Malibu Unified School District,
Public School Facilities Reconstruction Projects................................ 5.500% 08/01/18 959,400
1,000,000 Southern California Public Power Authority,
Mead-Phoenix Project Revenue 1994 Ser. A (AMBAC Insured)........................ 4.750% 07/01/08 954,420
1,000,000 Southern California Public Power Authority,
Mead-Phoenix Project Revenue 1994 Ser. A (AMBAC Insured)........................ 4.750% 07/01/09 938,670
1,000,000 Southern California Public Power Authority,
Palo Verde Power Projects Revenue 1993 Ser. A................................... 5.100% 07/01/06 1,002,910
500,000 City of Stockton, 1990 Wastewater System Project COP (AMBAC Insured)............. 6.700% 09/01/98 517,630
500,000 City of Stockton, 1990 Wastewater System Project COP (AMBAC Insured)............. 6.800% 09/01/99 523,020
1,000,000 University of California, Housing System Revenue 1993 Ser. A (MBIA Insured)...... 5.500% 11/01/08 1,018,680
500,000 University of California, Research Facilities Revenue 1995 Ser. C (AMBAC Insured) 5.100% 09/01/07 499,370
1,000,000 West & Central Basin Finance Authority,
West Basin Water Revenue Refunding Project (AMBAC Insured)....................... 5.125% 08/01/06 1,004,600
1,000,000 City of Whittier, Solid Waste Revenue Ser. A (AMBAC Insured)..................... 5.375% 08/01/14 969,310
1,500,000 Yucaipa School Facilities Finance Authority, 1995 Sweetwater Refunding...........
(MBIA Insured).................................................................. 6.000% 09/01/10 1,553,340
-----------
TOTAL MUNICIPAL BONDS (COST $55,370,047) 56,440,820
-----------
SHORT TERM SECURITIES 5.6%
1,000,000 California State Revenue Anticipation Notes Ser. A............................... 4.500% 06/30/97 1,000,790
2,415,951 Provident Institutional Fund: Municipal Fund for California Investors, Inc....... 2,415,951
-----------
TOTAL SHORT TERM SECURITIES (COST $3,417,566) 3,416,741
-----------
TOTAL INVESTMENTS (COST $58,787,613), 98.5% 59,857,561
OTHER ASSETS AND LIABILITIES, NET, 1.5% 886,503
-----------
NET ASSETS, 100.0% $60,744,064
===========
</TABLE>
PORTFOLIO ABBREVIATIONS:
AMBAC - American Municipal Bond Assurance Corp.
COP - Certificates of Participation
FGIC - Financial Guaranty Insurance Corp.
GO - General Obligation
MBIA - Municipal Bond Investor Assurance Corp.
MUD - Municipal Utility District
RDA - Redevelopment Agency
The accompanying notes are an integral part of these financial statements. 45
<PAGE> 48
FREMONT MUTUAL FUNDS, INC.
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
INTERNATIONAL INTERNATIONAL
GLOBAL GROWTH SMALL CAP
FUND FUND FUND
--------------------------------------------------
<S> <C> <C> <C>
ASSETS:
Investments in securities at cost $571,998,869 $36,881,921 $ 9,977,344
============ =========== ===========
Investments in securities at value (Note 1) 615,871,681 39,251,306 9,362,606
Securities lending collateral (Note 1) 68,902,414 5,455,152 602,939
Cash -- -- 107,084
Dividends and interest receivable 4,621,803 26,867 51,728
Receivable for securities sold 275,945 8,970 --
Receivable from management company -- 1,506 --
Receivable from sale of fund shares 480,979 23,814 10,313
Variation margin receivable -- -- --
Unrealized appreciation on foreign currency contracts 2,681,772 -- --
Prepaid expense 11,604 -- --
Unamortized organization costs (Note 3) -- -- --
------------ ----------- -----------
TOTAL ASSETS 692,846,198 44,767,615 10,134,670
------------ ----------- -----------
LIABILITIES:
Liabilities for securities lending collateral 68,902,414 5,455,152 602,939
Liabilities for options written (Note 4) -- -- --
Dividends payable to shareholders -- -- --
Payable for securities purchased 1,575,505 553,391 39,748
Payable for fund shares redeemed 372,165 56,749 20,051
Unrealized depreciation on foreign currency contracts 417,580 -- --
Accrued expenses:
Investment advisory and administrative fees 369,847 47,254 11,609
Shareholder servicing fees 10,500 -- --
Custody fees 61,614 -- --
Accounting fees 16,300 -- --
Audit and legal fees 21,027 -- --
Other payables 39,098 -- --
------------ ----------- -----------
TOTAL LIABILITIES 71,786,050 6,112,546 674,347
------------ ----------- -----------
NET ASSETS $621,060,148 $38,655,069 $ 9,460,323
============ =========== ===========
Net assets consist of:
Paid in capital $564,529,397 $34,816,043 $ 9,609,252
Undistributed net investment income (loss) 1,028,863 (26,369) 60,136
Unrealized appreciation (depreciation) on investments 43,872,812 2,369,385 (614,738)
Unrealized appreciation (depreciation) on foreign currency
contracts and other assets and liabilities 2,139,809 (2,584) (1,937)
Accumulated net realized gain 9,489,267 1,498,594 407,610
------------ ----------- -----------
NET ASSETS $621,060,148 $38,655,069 $ 9,460,323
============ =========== ===========
SHARES OF CAPITAL STOCK OUTSTANDING 44,514,593 3,580,649 981,940
============ =========== ===========
NET ASSET VALUE PER SHARE $ 13.95 $ 10.80 $ 9.63
============ =========== ===========
</TABLE>
46 The accompanying notes are an integral part of these financial statements.
<PAGE> 49
<TABLE>
<CAPTION>
EMERGING U.S.
MARKETS MICRO-CAP GROWTH
FUND FUND FUND
--------------------------------------------------
<S> <C> <C> <C>
ASSETS:
Investments in securities at cost $7,481,492 $141,049,908 $105,774,770
========== ============ ============
Investments in securities at value (Note 1) 8,022,923 134,153,553 115,316,407
Securities lending collateral (Note 1) -- 16,878,022 10,122,442
Cash 4,047 -- --
Dividends and interest receivable 25,002 17,696 188,801
Receivable for securities sold 352,222 4,291,955 472,259
Receivable from management company 3,965 -- --
Receivable from sale of fund shares 138,282 431,041 724,799
Variation margin receivable -- -- --
Unrealized appreciation on foreign currency contracts -- -- --
Prepaid expense -- -- 1,112
Unamortized organization costs (Note 3) 14,111 -- 492
---------- ------------ ------------
TOTAL ASSETS 8,560,552 155,772,267 126,826,312
---------- ------------ ------------
LIABILITIES:
Liabilities for securities lending collateral -- 16,878,022 10,122,442
Liabilities for options written (Note 4) -- -- --
Dividends payable to shareholders -- -- --
Payable for securities purchased 133,618 -- 319,937
Payable for fund shares redeemed -- 683,796 220,115
Unrealized depreciation on foreign currency contracts 1,112 -- --
Accrued expenses:
Investment advisory and administrative fees -- 228,785 58,486
Shareholder servicing fees -- -- 4,100
Custody fees -- -- 8,366
Accounting fees -- -- 2,990
Audit and legal fees -- -- 12,597
Other payables -- -- 6,552
---------- ------------ ------------
TOTAL LIABILITIES 134,730 17,790,603 10,755,585
---------- ------------ ------------
NET ASSETS $8,425,822 $137,981,664 $116,070,727
========== ============ ============
Net assets consist of:
Paid in capital $7,814,912 $143,840,362 $102,284,502
Undistributed net investment income (loss) 55,323 (505,219) 456,763
Unrealized appreciation (depreciation) on investments 541,431 (6,896,355) 9,541,637
Unrealized appreciation (depreciation) on foreign currency
contracts and other assets and liabilities (1,353) -- --
Accumulated net realized gain 15,509 1,542,876 3,787,825
---------- ------------ ------------
NET ASSETS $8,425,822 $137,981,664 $116,070,727
========== ============ ============
SHARES OF CAPITAL STOCK OUTSTANDING 756,753 7,299,843 8,644,925
========== ============ ============
NET ASSET VALUE PER SHARE $ 11.13 $ 18.90 $ 13.43
========== ============ ============
</TABLE>
<TABLE>
<CAPTION>
CALIFORNIA
INTERMEDIATE
BOND MONEY MARKET TAX-FREE
FUND FUND FUND
---------------------------------------------------
<S> <C> <C> <C>
ASSETS:
Investments in securities at cost $80,286,005 $429,977,136 $58,787,613
=========== ============ ===========
Investments in securities at value (Note 1) 80,968,188 429,977,136 59,857,561
Securities lending collateral (Note 1) -- -- --
Cash -- -- 190,613
Dividends and interest receivable 533,469 736,754 771,385
Receivable for securities sold -- -- --
Receivable from management company 189 -- --
Receivable from sale of fund shares 24,625 760,377 1,650
Variation margin receivable 42,813 -- --
Unrealized appreciation on foreign currency contracts 73,161 -- --
Prepaid expense 598 40,167 658
Unamortized organization costs (Note 3) 1,495 -- --
----------- ------------ -----------
TOTAL ASSETS 81,644,538 431,514,434 60,821,867
----------- ------------ -----------
LIABILITIES:
Liabilities for securities lending collateral -- -- --
Liabilities for options written (Note 4) 38,750 -- --
Dividends payable to shareholders 14,818 9,169 28,417
Payable for securities purchased 6,159,544 -- --
Payable for fund shares redeemed 175,052 1,305,309 --
Unrealized depreciation on foreign currency contracts 82,110 -- --
Accrued expenses:
Investment advisory and administrative fees 24,094 74,106 15,126
Shareholder servicing fees 2,600 6,200 2,500
Custody fees 8,009 12,566 3,455
Accounting fees 3,200 7,750 3,200
Audit and legal fees 12,597 12,597 11,347
Other payables 23,724 27,044 13,758
----------- ------------ -----------
TOTAL LIABILITIES 6,544,498 1,454,741 77,803
----------- ------------ -----------
NET ASSETS $75,100,040 $430,059,693 $60,744,064
=========== ============ ===========
Net assets consist of:
Paid in capital $74,238,605 $430,059,693 $59,655,545
Undistributed net investment income (loss) (153,856) -- --
Unrealized appreciation (depreciation) on investments 701,630 -- 1,069,948
Unrealized appreciation (depreciation) on foreign currency
contracts and other assets and liabilities 39,702 -- --
Accumulated net realized gain 273,959 -- 18,571
----------- ------------ -----------
NET ASSETS $75,100,040 $430,059,693 $60,744,064
=========== ============ ===========
SHARES OF CAPITAL STOCK OUTSTANDING 7,608,619 430,059,693 5,678,597
=========== ============ ===========
NET ASSET VALUE PER SHARE $ 9.87 $ 1.00 $ 10.70
=========== ============ ===========
</TABLE>
47
<PAGE> 50
FREMONT MUTUAL FUNDS, INC.
Six Months Ended April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL INTERNATIONAL
GLOBAL GROWTH SMALL CAP
FUND FUND FUND
------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 6,946,960 $ 66,964 $ 8,622
Dividends 3,730,514 192,995 146,009
----------- ---------- ---------
TOTAL INCOME* 10,677,474 259,959 154,631
----------- ---------- ---------
EXPENSES:
Investment advisory and administrative fees (Note 2) 2,233,389 286,328 71,874
Shareholder servicing fees (Note 2) 59,900 -- --
Custody fees 64,355 -- --
Distribution fees (Note 2) -- -- --
Accounting fees 81,313 -- --
Audit and legal fees 23,314 -- --
Directors' fees (Note 2) 4,799 -- --
Registration fees 24,505 -- --
Interest expense (Note 1) -- -- --
Other 49,293 -- --
----------- ---------- ---------
TOTAL EXPENSES BEFORE REDUCTIONS 2,540,868 286,328 71,874
Expenses waived and/or reimbursed by Advisor -- -- --
----------- ---------- ---------
TOTAL NET EXPENSES 2,540,868 286,328 71,874
----------- ---------- ---------
NET INVESTMENT INCOME (LOSS) 8,136,606 (26,369) 82,757
----------- ---------- ---------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS
AND FOREIGN CURRENCY:
Net realized gain (loss) from:
Investments 5,708,695 1,591,386 432,290
Foreign currency transactions 3,657,950 (92,792) (2,851)
Net increase (decrease) in unrealized appreciation
(depreciation) on:
Investments 16,287,209 (60,531) (727,042)
Translation of assets and liabilities in foreign currencies 3,067,817 (2,099) (2,806)
----------- ---------- ---------
Net realized and unrealized gain (loss) from investments
and foreign currency 28,721,671 1,435,964 (300,409)
----------- ---------- ---------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $36,858,277 $1,409,595 $(217,652)
=========== ========== =========
</TABLE>
* Net of foreign taxes withheld of $224,803 for Fremont Global Fund, $29,943 for
Fremont International Growth Fund, $18,175 for Fremont International Small Cap
Fund and $2,896 for Fremont Emerging Markets Fund.
48 The accompanying notes are an integral part of these financial statements.
<PAGE> 51
<TABLE>
<CAPTION>
EMERGING U.S.
MARKETS MICRO-CAP GROWTH
FUND FUND FUND
----------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 35,636 $ 813,048 $ 109,683
Dividends 36,076 107,117 1,111,191
-------- ----------- ----------
TOTAL INCOME* 71,712 920,165 1,220,874
-------- ----------- ----------
EXPENSES:
Investment advisory and administrative fees (Note 2) 32,167 1,457,521 329,670
Shareholder servicing fees (Note 2) 14,043 -- 24,051
Custody fees 11,500 -- 9,004
Distribution fees (Note 2) 6,993 -- --
Accounting fees 6,600 -- 16,269
Audit and legal fees 6,744 -- 19,712
Directors' fees (Note 2) 4,163 -- 4,799
Registration fees 5,535 -- 15,781
Interest expense (Note 1) -- -- --
Other 8,952 -- (7,515)
-------- ----------- ----------
TOTAL EXPENSES BEFORE REDUCTIONS 96,697 1,457,521 411,771
Expenses waived and/or reimbursed by Advisor (96,697) (32,137) --
-------- ----------- ----------
TOTAL NET EXPENSES -- 1,425,384 411,771
-------- ----------- ----------
NET INVESTMENT INCOME (LOSS) 71,712 (505,219) 809,103
-------- ----------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS
AND FOREIGN CURRENCY:
Net realized gain (loss) from:
Investments 103,053 1,577,289 3,694,333
Foreign currency transactions (2,959) -- --
Net increase (decrease) in unrealized appreciation
(depreciation) on:
Investments 585,271 (7,332,078) 5,053,002
Translation of assets and liabilities in foreign currencies (1,341) -- --
-------- ----------- ----------
Net realized and unrealized gain (loss) from investments
and foreign currency 684,024 (5,754,789) 8,747,335
-------- ----------- ----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $755,736 $(6,260,008) $9,556,438
======== =========== ==========
</TABLE>
<TABLE>
<CAPTION>
CALIFORNIA
INTERMEDIATE
BOND MONEY MARKET TAX-FREE
FUND FUND FUND
-------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 2,556,427 $10,227,620 $1,548,493
Dividends 17,625 -- --
----------- ----------- ----------
TOTAL INCOME* 2,574,052 10,227,620 1,548,493
----------- ----------- ----------
EXPENSES:
Investment advisory and administrative fees (Note 2) 197,240 676,711 150,532
Shareholder servicing fees (Note 2) 14,862 34,104 14,470
Custody fees 13,182 15,435 4,042
Distribution fees (Note 2) -- -- --
Accounting fees 15,422 44,275 14,340
Audit and legal fees 14,884 14,884 13,633
Directors' fees (Note 2) 4,799 4,799 4,799
Registration fees 6,594 32,138 3,019
Interest expense (Note 1) 11,116 -- --
Other 4,219 (509) (716)
----------- ----------- ----------
TOTAL EXPENSES BEFORE REDUCTIONS 282,318 821,837 204,119
Expenses waived and/or reimbursed by Advisor (53,793) (279,393) (61,109)
----------- ----------- ----------
TOTAL NET EXPENSES 228,525 542,444 143,010
----------- ----------- ----------
NET INVESTMENT INCOME (LOSS) 2,345,527 9,685,176 1,405,483
----------- ----------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS
AND FOREIGN CURRENCY:
Net realized gain (loss) from:
Investments 786,234 -- 18,307
Foreign currency transactions 247,715 -- --
Net increase (decrease) in unrealized appreciation
(depreciation) on:
Investments (1,653,408) -- (630,280)
Translation of assets and liabilities in foreign currencies (107,274) -- --
----------- ----------- ----------
Net realized and unrealized gain (loss) from investments
and foreign currency (726,733) -- (611,973)
----------- ----------- ----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 1,618,794 $ 9,685,176 $ 793,510
=========== =========== ==========
</TABLE>
49
<PAGE> 52
FREMONT MUTUAL FUNDS, INC.
April 30, 1997 (Unaudited)
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
GLOBAL INTERNATIONAL GROWTH
FUND FUND
------------------------------ ----------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
4/30/97 10/31/96 4/30/97 10/31/96
------------- ------------- ------------ ------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ 8,136,606 $ 14,178,709 $ (26,369) $ (71,581)
Net realized gain (loss) from investments
and transactions in written options 5,708,695 66,430,845 1,591,386 2,385,592
Net realized gain (loss) from foreign currency transactions 3,657,950 3,713,517 (92,792) (123,314)
Net unrealized appreciation (depreciation) on investments 16,287,209 (16,096,541) (60,531) 370,380
Net unrealized appreciation (depreciation) on translation of
assets and liabilities in foreign currencies 3,067,817 (966,466) (2,099) (1,146)
------------- ------------- ------------ ------------
Net increase (decrease) in net assets from operations 36,858,277 67,260,064 1,409,595 2,559,931
------------- ------------- ------------ ------------
Distributions to shareholders from:
Net investment income (9,349,318) (15,978,412) -- (25,060)
Net realized gains (68,976,401) (19,404,727) (103,054) --
------------- ------------- ------------ ------------
Total distributions to shareholders (78,325,719) (35,383,139) (103,054) (25,060)
------------- ------------- ------------ ------------
From capital share transactions:
Proceeds from shares sold 99,350,290 86,354,528 6,731,828 7,454,198
Payments for shares redeemed (80,596,995) (62,546,779) (4,758,841) (6,897,361)
Reinvested dividends 71,624,059 34,110,706 102,795 25,025
------------- ------------- ------------ ------------
Net increase in net assets
from capital share transactions 90,377,354 57,918,455 2,075,782 581,862
------------- ------------- ------------ ------------
Net increase in net assets 48,909,912 89,795,380 3,382,323 3,116,733
Net assets at beginning of period 572,150,236 482,354,856 35,272,746 32,156,013
------------- ------------- ------------ ------------
NET ASSETS AT END OF PERIOD** $ 621,060,148 $ 572,150,236 $ 38,655,069 $ 35,272,746
============= ============= ============ ============
CAPITAL TRANSACTIONS IN SHARES:
Sold 6,946,665 5,889,696 617,954 727,743
Redeemed (5,611,427) (4,265,461) (439,002) (647,428)
Reinvested dividends 5,309,419 2,372,436 9,607 2,541
------------- ------------- ------------ ------------
Net increase in capital share transactions 6,644,657 3,996,671 188,559 82,856
============= ============= ============ ============
</TABLE>
** Net assets at April 30, 1997 and October 31, 1996, respectively, include
undistributed net investment income (loss) of $1,028,863 and $2,241,575
for Fremont Global Fund, $(26,369) and $-- for Fremont International
Growth Fund, $60,136 and $27,143 for Fremont International Small Cap Fund,
$55,323 and $7,385 for Fremont Emerging Markets Fund, $(505,219) and $--
for Fremont U.S. Micro-Cap Fund, and $456,763 and $110,727 for Fremont
Growth Fund.
# Period from June 24, 1996 (commencement of operations) to October 31,
1996.
50 The accompanying notes are an integral part of these financial statements.
<PAGE> 53
<TABLE>
<CAPTION>
INTERNATIONAL SMALL CAP EMERGING MARKETS U.S MICRO-CAP GROWTH
FUND FUND FUND FUND
- --------------------------- --------------------------- ------------------------------- ------------------------------
SIX MONTHS YEAR SIX MONTHS PERIOD SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED ENDED ENDED
4/30/97 10/31/96 4/30/97 10/31/96# 4/30/97 10/31/96 4/30/97 10/31/96
- ----------- ----------- ----------- ----------- ------------- ------------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 82,757 $ 102,521 $ 71,712 $ 38,637 $ (505,219) $ (232,999) $ 809,103 $ 510,822
432,290 272,776 103,053 (84,620) 1,577,289 5,347,629 3,694,333 17,602,434
(2,851) (72,383) (2,959) (5,125) -- -- -- --
(727,042) 328,876 585,271 (43,840) (7,332,078) (512,157) 5,053,002 (4,559,067)
(2,806) 1,815 (1,341) 11 -- -- -- --
- ----------- ----------- ----------- ----------- ------------- ------------- ------------- ------------
(217,652) 633,605 755,736 (94,937) (6,260,008) 4,602,473 9,556,438 13,554,189
- ----------- ----------- ----------- ----------- ------------- ------------- ------------- ------------
(49,764) (36,496) (23,774) (26,116) -- -- (463,067) (409,404)
(226,667) -- -- -- (5,143,923) (323,213) (17,563,577) (3,508,522)
- ----------- ----------- ----------- ----------- ------------- ------------- ------------- ------------
(276,431) (36,496) (23,774) (26,116) (5,143,923) (323,213) (18,026,644) (3,917,926)
- ----------- ----------- ----------- ----------- ------------- ------------- ------------- ------------
2,132,103 5,840,661 6,283,483 3,982,064 249,831,889 162,319,610 62,075,349 31,461,523
(1,645,805) (1,489,319) (2,384,950) (115,175) (207,555,504) (72,224,013) (34,116,682) (25,982,666)
253,933 20,865 23,578 25,913 4,628,259 313,977 17,958,154 3,876,573
- ----------- ----------- ----------- ----------- ------------- ------------- ------------- ------------
740,231 4,372,207 3,922,111 3,892,802 46,904,644 90,409,574 45,916,821 9,355,430
- ----------- ----------- ----------- ----------- ------------- ------------- ------------- ------------
246,148 4,969,316 4,654,073 3,771,749 35,500,713 94,688,834 37,446,615 18,991,693
9,214,175 4,244,859 3,771,749 -- 102,480,951 7,792,117 78,624,112 59,632,419
----------- ----------- ----------- ------------- ------------- ------------- ------------
$ 9,460,323 $ 9,214,175 $ 8,425,822 $ 3,771,749 $ 137,981,664 $ 102,480,951 $ 116,070,727 $ 78,624,112
=========== =========== =========== =========== ============= ============= ============= ============
212,005 583,448 581,870 401,191 11,633,349 8,424,985 4,517,984 2,313,441
(163,890) (149,348) (219,499) (11,901) (9,778,993) (3,767,440) (2,546,748) (1,944,975)
25,991 2,288 2,461 2,631 223,695 20,793 1,438,955 301,367
- ----------- ----------- ----------- ----------- ------------- ------------- ------------- ------------
74,106 436,388 364,832 391,921 2,078,051 4,678,338 3,410,191 669,833
=========== =========== =========== =========== ============= ============= ============= ============
</TABLE>
51
<PAGE> 54
FREMONT MUTUAL FUNDS, INC.
April 30, 1997 (Unaudited)
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
BOND MONEY MARKET
FUND FUND
---------------------------- ------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
4/30/97 10/31/96 4/30/97 10/31/96
------------ ------------ ------------- -------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income $ 2,345,527 $ 5,389,594 $ 9,685,176 $ 15,629,237
Net realized gain (loss) from investments
and transactions in written options 786,234 (216,232) -- --
Net realized gain from foreign currency transactions 247,715 96,978 -- --
Net unrealized appreciation (depreciation) on investments (1,653,408) 276,789 -- --
Net unrealized appreciation (depreciation) on translation of
assets and liabilities in foreign currencies (107,274) 170,440 -- --
------------ ------------ ------------- -------------
Net increase in net assets from operations 1,618,794 5,717,569 9,685,176 15,629,237
------------ ------------ ------------- -------------
Distributions to shareholders from:
Net investment income (2,502,030) (5,647,913) (9,685,176) (15,629,237)
Net realized gains -- (1,968,201) -- --
------------ ------------ ------------- -------------
Total distributions to shareholders (2,502,030) (7,616,114) (9,685,176) (15,629,237)
------------ ------------ ------------- -------------
From capital share transactions:
Proceeds from shares sold 15,102,821 17,733,366 389,730,010 308,476,828
Payments for shares redeemed (12,111,125) (39,028,358) (298,867,194) (293,545,954)
Reinvested dividends 2,414,517 7,427,929 9,544,958 15,409,433
------------ ------------ ------------- -------------
Net increase (decrease) in net assets
from capital share transactions 5,406,213 (13,867,063) 100,407,774 30,340,307
------------ ------------ ------------- -------------
Net increase (decrease) in net assets 4,522,977 (15,765,608) 100,407,774 30,340,307
Net assets at beginning of period 70,577,063 86,342,671 329,651,919 299,311,612
------------ ------------ ------------- -------------
NET ASSETS AT END OF PERIOD** $ 75,100,040 $ 70,577,063 $ 430,059,693 $ 329,651,919
============ ============ ============= =============
CAPITAL TRANSACTIONS IN SHARES:
Sold 1,524,501 1,778,229 389,730,010 308,476,828
Redeemed (1,222,568) (3,985,015) (298,867,194) (293,545,954)
Reinvested dividends 243,608 747,888 9,544,958 15,409,433
------------ ------------ ------------- -------------
Net increase (decrease) in capital share transactions 545,541 (1,458,898) 100,407,774 30,340,307
============ ============ ============= =============
</TABLE>
** For Fremont Bond Fund, net assets at April 30, 1997 and October 31, 1996,
include undistributed net investment income (loss) of $(153,856) and
$2,647, respectively. There was no undistributed net investment income for
Fremont Money Market Fund or Fremont California Intermediate Tax-Free Fund
at April 30, 1997, nor at October 31, 1996.
52 The accompanying notes are an integral part of these financial statements.
<PAGE> 55
<TABLE>
<CAPTION>
CALIFORNIA
INTERMEDIATE TAX-FREE
FUND
- -----------------------------
SIX MONTHS YEAR
ENDED ENDED
4/30/97 10/31/96
- ------------ ------------
<S> <C>
$ 1,405,483 $ 2,476,355
18,307 44,827
============ ============
(630,280) (192,443)
-- --
- ------------ ------------
793,510 2,328,739
- ------------ ------------
(1,405,483) (2,476,355)
(44,827) (119,954)
- ------------ ------------
(1,450,310) (2,596,309)
- ------------ ------------
13,600,238 2,285,491
(4,633,516) (3,402,568)
1,278,098 2,227,490
- ------------ ------------
10,244,820 1,110,413
============ ============
9,588,020 842,843
51,156,044 50,313,201
- ------------ ------------
$ 60,744,064 $ 51,156,044
============ ============
1,252,227 210,037
(426,717) (315,379)
118,388 206,265
- ------------ ------------
943,898 100,923
============ ============
</TABLE>
<PAGE> 56
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1997
GLOBAL FUND
<TABLE>
<CAPTION>
(UNAUDITED) YEAR ENDED OCTOBER 31
SIX MONTHS ENDED -----------------------------------------------------
APRIL 30, 1997 1996 1995 1994
---------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.11 $ 14.24 $ 13.13 $ 13.17
------------- ------------- ------------- -------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income .25 .39 .40 .26
Net realized and unrealized gain (loss) .63 1.49 1.24 (.03)
------------- ------------- ------------- -------------
Total investment operations .88 1.88 1.64 .23
------------- ------------- ------------- -------------
LESS DISTRIBUTIONS
From net investment income (.23) (.44) (.50) (.14)
From net realized gains (1.81) (.57) (.03) (.13)
Return of capital -- -- -- --
Total distributions (2.04) (1.01) (.53) (.27)
------------- ------------- ------------- -------------
NET ASSET VALUE, END OF PERIOD $ 13.95 $ 15.11 $ 14.24 $ 13.13
============= ============= ============= =============
TOTAL RETURN 6.37% 13.72% 12.78% 1.74%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 621,060 $ 572,150 $ 482,355 $ 453,623
Ratio of expenses to average net assets .85%* .87% .88% .95%
Ratio of net investment income to average net asset 2.74%* 2.66% 2.98% 2.47%
Portfolio turnover rate 44%* 71% 83% 52%
Average commission rate paid $ .0201 $ .0238 -- --
</TABLE>
*Annualized
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31
------------------------------
1993 1992
------------- -------------
<S> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.52 $ 11.25
------------- -------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income .32 .39
Net realized and unrealized gain (loss) 1.67 .40
------------- -------------
Total investment operations 1.99 .79
------------- -------------
LESS DISTRIBUTIONS
From net investment income (.26) (.40)
From net realized gains (.08) (.11)
Return of capital -- (.01)
Total distributions (.34) (.52)
------------- -------------
NET ASSET VALUE, END OF PERIOD $ 13.17 $ 11.52
============= =============
TOTAL RETURN 17.51% 7.10%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 186,325 $ 101,839
Ratio of expenses to average net assets .99% 1.09%
Ratio of net investment income to average net asset 2.89% 3.41%
Portfolio turnover rate 40% 50%
Average commission rate paid -- --
</TABLE>
*Annualized
INTERNATIONAL GROWTH FUND
<TABLE>
<CAPTION>
(UNAUDITED) YEAR ENDED OCTOBER 31 PERIOD FROM
SIX MONTHS ENDED --------------------- MARCH 1, 1994 TO
APRIL 30, 1997 1996 1995 OCTOBER 31, 1994
---------------- ------- ------- ----------------
<S> <C> <C> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.40 $ 9.72 $ 9.79 $ 9.57
-------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (.01) (.02) .10 .02
Net realized and unrealized gain (loss) .44 .71 (.09) .20
-------- ------- ------- -------
Total investment operations .43 .69 .01 .22
-------- ------- ------- -------
LESS DISTRIBUTIONS
From net investment income -- (.01) (.08) --
From net realized gains (.03) -- -- --
-------- ------- ------- -------
Total distributions (.03) (.01) (.08) --
-------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 10.80 $ 10.40 $ 9.72 $ 9.79
======== ======= ======= =======
TOTAL RETURN 4.14% 7.07% 0.13% 2.30%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 38,655 $35,273 $32,156 $29,725
Ratio of expenses to average net assets 1.50%* 1.50% 1.50% 1.50%*
Ratio of net investment income (loss) to average net assets -0.14%* -0.20% 1.19% .35%*
Portfolio turnover rate 106%* 74% 32% 44%*
Average commission rate paid $ .0282 $ .0150 -- --
</TABLE>
*Annualized
54 The accompanying notes are an integral part of these financial statements.
<PAGE> 57
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1997
INTERNATIONAL SMALL CAP FUND
<TABLE>
<CAPTION>
(UNAUDITED) YEAR ENDED OCTOBER 31
SIX MONTHS ENDED ---------------------------
APRIL 30, 1997 1996 1995
---------------- ----------- -----------
<S> <C> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.15 $ 9.00 $ 9.86
----------- ----------- -----------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss)(a) .08 .14 .10
Net realized and unrealized gain (loss) (.31) 1.08 (.88)
----------- ----------- -----------
Total investment operations (.23) 1.22 (.78)
----------- ----------- -----------
LESS DISTRIBUTIONS
From net investment income (.05) (.07) (.08)
From net realized gains (.24) -- --
----------- ----------- -----------
Total distributions (.29) (.07) (.08)
----------- ----------- -----------
NET ASSET VALUE, END OF PERIOD $ 9.63 $ 10.15 $ 9.00
=========== =========== ===========
TOTAL RETURN# -2.28% 13.69% -7.96%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 9,460 $ 9,214 $ 4,245
Ratio of expenses to average net assets(a) 1.50%* 1.81% 2.06%
Ratio of net investment income (loss) to average net assets(a) 1.73%* 1.61% 1.67%
Portfolio turnover rate 78%* 74% 96%
Average commission rate paid $ .0003 $ .0003 --
</TABLE>
<TABLE>
<CAPTION>
PERIOD FROM
JUNE 30, 1994 TO
OCTOBER 31, 1994
----------------
<S> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.00
-----------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss)(a) (.01)
Net realized and unrealized gain (loss) (.13)
-----------
Total investment operations (.14)
-----------
LESS DISTRIBUTIONS
From net investment income --
From net realized gains --
-----------
Total distributions --
-----------
NET ASSET VALUE, END OF PERIOD $ 9.86
===========
TOTAL RETURN# -1.40%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 1,768
Ratio of expenses to average net assets(a) 2.50%*
Ratio of net investment income (loss) to average net assets(a) -0.28%*
Portfolio turnover rate --
Average commission rate paid --
</TABLE>
* Annualized
(a) Management fees were voluntarily waived from February 1, 1995 to October
31, 1996. If fees had been charged fully, net investment income (loss) per
share, ratio of expenses to average net assets and ratio of net investment
income (loss) to average net assets would have been $.08, 2.50% and 0.92%,
respectively, for the year ended October 31, 1996, and $.07, 2.50% and
1.23%, respectively, for the year ended October 31, 1995.
# Total return would have been lower had the advisor not waived expenses.
EMERGING MARKETS FUND
<TABLE>
<CAPTION>
(UNAUDITED) PERIOD FROM
SIX MONTHS ENDED JUNE 24, 1996 TO
APRIL 30, 1997 OCTOBER 31, 1996
---------------- ----------------
<S> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.62 $ 10.00
----------- -----------
INCOME FROM INVESTMENT OPERATIONS
Net investment income(a) .15 .10
Net realized and unrealized gain (loss) 1.42 (.41)
----------- -----------
Total investment operations 1.57 (.31)
----------- -----------
LESS DISTRIBUTIONS
From net investment income (.06) (.07)
From net realized gains -- --
----------- -----------
Total distributions (.06) (.07)
----------- -----------
NET ASSET VALUE, END OF PERIOD $ 11.13 $ 9.62
=========== ===========
TOTAL RETURN# 16.42% -3.12%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 8,426 $ 3,772
Ratio of expenses to average net assets(a) 0.00%* 0.00%*
Ratio of net investment income to average net assets(a) 2.55%* 3.32%*
Portfolio turnover rate 107%* 20%*
Average commission rate paid $ .0066 $ .0063
</TABLE>
* Annualized
(a) Management fees and all other expenses have been voluntarily waived or
reimbursed from June 24, 1996 onwards. If fees had been charged fully, net
investment income (loss) per share, ratio of expenses to average net
assets and ratio of net investment income (loss) to average net assets
would have been -$.05, 3.44% and -.89%, respectively, for six months ended
April 30, 1997, and -$.05, 4.95% and -1.63%, respectively, for the period
ended October 31, 1996.
# Total return would have been lower had the advisor not waived or
reimbursed expenses.
The accompanying notes are an integral part of these financial statements. 55
<PAGE> 58
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1997
U.S. MICRO-CAP FUND
<TABLE>
<CAPTION>
(UNAUDITED) YEAR ENDED OCTOBER 31 PERIOD FROM
SIX MONTHS ENDED --------------------- JUNE 30, 1994 TO
APRIL 30, 1997 1996 1995 OCTOBER 31, 1994
---------------- -------- ------- ----------------
<S> <C> <C> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 19.63 $ 14.34 $ 10.34 $ 10.00
------------- -------- ------- -------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss)(a) (.07) (.04) (.05) .02
Net realized and unrealized gain .26 5.83 4.05 .34
------------- -------- ------- -------------
Total investment operations .19 5.79 4.00 .36
------------- -------- ------- -------------
LESS DISTRIBUTIONS
From net investment income -- -- -- (.02)
From net realized gains (.92) (.50) -- --
------------- -------- ------- -------------
Total distributions (.92) (.50) -- (.02)
------------- -------- ------- -------------
NET ASSET VALUE, END OF PERIOD $ 18.90 $ 19.63 $ 14.34 $ 10.34
============= ======== ======= =============
TOTAL RETURN# 0.55% 41.46% 38.68% 3.60%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 137,982 $102,481 $ 7,792 $ 2,052
Ratio of expenses to average net assets(a) 1.88%* 1.96% 2.04% 2.50%*
Ratio of net investment income (loss) to average net assets(a) -0.67%* -0.51% -0.67% 0.68%*
Portfolio turnover rate 94%* 81% 144% 129%
Average commission rate paid $ .0516 $ .0541 -- --
</TABLE>
* Annualized
(a) Management fees have been voluntarily waived from February 1, 1995
onwards. If fees had been charged fully, net investment income (loss) per
share, ratio of expenses to average net assets and ratio of net investment
income (loss) to average net assets would have been -$.07, 1.92% and
-.71%, respectively, for the six months ended April 30, 1997; -$.06, 2.22%
and -.77%, respectively, for the year ended October 31, 1996, and -$.08,
2.50% and -1.13%, respectively, for the year ended October 31, 1995.
# Total return would have been lower had the advisor not waived expenses.
GROWTH FUND
<TABLE>
<CAPTION>
(UNAUDITED) YEAR ENDED OCTOBER 31
SIX MONTHS ENDED ---------------------------------------
APRIL 30, 1997 1996 1995 1994 1993
----------------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.02 $ 13.06 $ 10.46 $ 11.25 $ 10.08
------------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income(a) .11 .10 .13 .21 .13
Net realized and unrealized gain (loss) 1.33 2.65 2.74 (.02) 1.16
------------- ------- ------- ------- -------
Total investment operations 1.44 2.75 2.87 .19 1.29
------------- ------- ------- ------- -------
LESS DISTRIBUTIONS
From net investment income (.08) (.08) (.17) (.18) (.12)
From net realized gains (2.95) (.71) (.10) (.80) --
------------- ------- ------- ------- -------
Total distributions (3.03) (.79) (.27) (.98) (.12)
------------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 13.43 $ 15.02 $ 13.06 $ 10.46 $ 11.25
============= ======= ======= ======= =======
TOTAL RETURN# 11.13% 22.06% 28.12% 1.72% 12.80%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 116,071 $78,624 $59,632 $27,244 $42,306
Ratio of expenses to average net assets(a) .81%* .92% .97% .94% .87%
Ratio of net investment income to average net assets(a) 1.59%* .75% 1.02% 1.31% 1.19%
Portfolio turnover rate 62%* 129% 108% 55% 44%
Average commission rate paid $ .0443 $ .0429 -- -- --
</TABLE>
<TABLE>
<CAPTION>
PERIOD FROM
AUGUST 14, 1992 TO
OCTOBER 31, 1992
------------------
<S> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.92
-------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income(a) .02
Net realized and unrealized gain (loss) .18
-------------
Total investment operations .20
-------------
LESS DISTRIBUTIONS
From net investment income (.04)
From net realized gains --
-------------
Total distributions (.04)
-------------
NET ASSET VALUE, END OF PERIOD $ 10.08
=============
TOTAL RETURN# 2.00%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 32,388
Ratio of expenses to average net assets(a) .94%*
Ratio of net investment income to average net assets(a) 1.08%*
Portfolio turnover rate 49%*
Average commission rate paid --
</TABLE>
* Annualized
(a) Management and other expenses charged since the Fund's inception have been
phased-in over time. If fees had been charged fully, net investment income
per share, ratio of expenses to average net assets, and ratio of net
investment income to average net assets would have been $.12, 1.01% and
.98%, respectively, for the year ended October 31, 1995; $.19, 1.08% and
1.17%, respectively, for the year ended October 31, 1994; $.11, 1.02% and
1.04%, respectively, for the year ended October 31, 1993; and $.02, 1.18%
and 0.84%, respectively, for the period ended October 31, 1992.
# Total return would have been lower had the advisor not waived expenses.
56 The accompanying notes are an integral part of these financial statements.
<PAGE> 59
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1997
BOND FUND
<TABLE>
<CAPTION>
(UNAUDITED) YEAR ENDED OCTOBER 31 PERIOD FROM
SIX MONTHS ENDED ------------------------------- APRIL 30, 1993 TO
APRIL 30, 1997 1996 1995 1994 OCTOBER 31, 1993
---------------- ------- ------- ------- -----------------
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.99 $ 10.13 $ 9.29 $ 10.27 $ 10.04
---------- ------- ------- ------- ----------
INCOME FROM INVESTMENT OPERATIONS
Net investment income(a) .32 .67 .65 .53 .27
Net realized and unrealized gain (loss) (.10) .11 .83 (.98) .24
---------- ------- ------- ------- ----------
Total investment operations .22 .78 1.48 (.45) .51
---------- ------- ------- ------- ----------
LESS DISTRIBUTIONS
From net investment income (.34) (.70) (.64) (.53) (.27)
From net realized gains -- (.22) -- -- (.01)
---------- ------- ------- ------- ----------
Total distributions (.34) (.92) (.64) (.53) (.28)
---------- ------- ------- ------- ----------
NET ASSET VALUE, END OF PERIOD $ 9.87 $ 9.99 $ 10.13 $ 9.29 $ 10.27
========== ======= ======= ======= ==========
TOTAL RETURN# 2.26% 8.18% 16.49% -4.42% 5.15%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 75,100 $70,577 $86,343 $64,244 $ 11,738
Ratio of expenses to average net assets(a) .64%* .68% .60% .66% .50%*
Ratio of net investment income to average net assets(a) 6.54%* 6.82% 6.69% 5.76% 5.35%*
Portfolio turnover rate 152%* 154% 21% 205% 13%*
</TABLE>
* Annualized
(a) Management and other expenses charged since the Fund's inception have been
phased in over time. If fees had been charged fully, net investment income
per share, ratio of expenses to average net assets and ratio of net
investment income to average net assets would have been $.31, .79% and
6.39%, respectively, for the six months ended April 30, 1997; $.66, .83%
and 6.67%, respectively, for the year ended October 31, 1996; $.64, .75%
and 6.54%, respectively, for the year ended October 31, 1995; $.50, 1.04%
and 5.38%, respectively, for the year ended October 31, 1994; and $.23,
1.23% and 4.62%, respectively, for the period ended October 31, 1993.
# Total return would have been lower had the advisor not waived expenses.
MONEY MARKET FUND
<TABLE>
<CAPTION>
(UNAUDITED) YEAR ENDED OCTOBER 31
SIX MONTHS ENDED -----------------------------------------------------
APRIL 30, 1997 1996 1995 1994 1993 1992
---------------- -------- -------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- -------- -------- -------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income(a) .03 .05 .06 .03 .03 .04
----------- -------- -------- -------- ------- -------
Total investment operations .03 .05 .06 .03 .03 .04
----------- -------- -------- -------- ------- -------
LESS DISTRIBUTIONS
From net investment income (.03) (.05) (.06) (.03) (.03) (.04)
----------- -------- -------- -------- ------- -------
Total distributions (.03) (.05) (.06) (.03) (.03) (.04)
----------- -------- -------- -------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== ======== ======== ======== ======= =======
TOTAL RETURN# 2.60% 5.34% 5.84% 3.49% 2.66% 3.73%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 430,060 $329,652 $299,312 $224,439 $24,207 $31,832
Ratio of expenses to average net assets(a) .29%* .31% .30% .46% .67% .70%
Ratio of net investment income to average net assets 5.19%* 5.22% 5.70% 4.02% 2.62% 3.70%
</TABLE>
* Annualized
(a) Administrative fees have been voluntarily waived from April 1, 1990
onwards. If fees had been charged fully, net investment income per share,
ratio of expenses to average net assets and ratio of net investment income
to average net assets would have been $.03, .44% and 5.04%, respectively,
for the six months ended April 30, 1997; $.05, .46% and 5.07%,
respectively, for the year ended October 31, 1996; $.06, .45% and 5.55%,
respectively, for the year ended October 31, 1995; $.03, .61% and 3.87%,
respectively, for the year ended October 31, 1994; $.03, .82% and 2.47%,
respectively, for the year ended October 31, 1993; $.04, .85% and 3.55%,
respectively, for the year ended October 31, 1992.
# Total return would have been lower had the advisor not waived expenses.
The accompanying notes are an integral part of these financial statements. 57
<PAGE> 60
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1997
CALIFORNIA INTERMEDIATE TAX-FREE FUND
<TABLE>
<CAPTION>
(UNAUDITED) YEAR ENDED OCTOBER 31
SIX MONTHS ENDED ---------------------------------------------------
APRIL 30, 1997 1996 1995 1994 1993 1992
---------------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
for one share outstanding during the period
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.80 $ 10.86 $ 10.13 $ 11.10 $ 10.55 $ 10.39
---------- ------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income(a) .26 .52 .53 .53 .55 .57
Net realized and unrealized gain (loss) (.09) (.03) .73 (.97) .62 .19
---------- ------- ------- ------- ------- -------
Total investment operations .17 .49 1.26 (.44) 1.17 .76
---------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS
From net investment income (.26) (.52) (.53) (.53) (.55) (.57)
From net realized gains (.01) (.03) -- -- (.07) (.03)
---------- ------- ------- ------- ------- -------
Total distributions (.27) (.55) (.53) (.53) (.62) (.60)
---------- ------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 10.70 $ 10.80 $ 10.86 $ 10.13 $ 11.10 $ 10.55
========== ======= ======= ======= ======= =======
TOTAL RETURN# 1.52% 4.63% 12.77% -3.94% 11.37% 7.37%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 60,744 $51,156 $50,313 $58,305 $59,716 $44,305
Ratio of expenses to average net assets(a) .49%* .51% .50% .51% .50% .54%
Ratio of net investment income to average net assets(a) 4.78%* 4.86% 5.08% 4.94% 5.05% 5.38%
Portfolio turnover rate 2%* 6% 18% 21% 26% 18%
</TABLE>
* Annualized
(a) Management and other expenses charged since the Fund's inception have been
phased-in over time. If fees had been charged fully, net investment income
per share, ratio of expenses to average net assets, and ratio of net
investment income to average net assets would have been $.25, .69% and
4.58%, respectively, for the six months ended April 30, 1997; $.50, .73%
and 4.64%, respectively, for the year ended October 31, 1996; $.51, .72%
and 4.86%, respectively, for the year ended October 31, 1995; $.51, .71%
and 4.74%, respectively, for the year ended October 31, 1994; $.53, .71%
and 4.84%, respectively, for the year ended October 31, 1993; and $.54,
.83% and 5.09%, respectively, for the year ended October 31, 1992.
# Total return would have been lower had the advisor not waived expenses.
58 The accompanying notes are an integral part of these financial statements.
<PAGE> 61
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1997 (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES
Fremont Mutual Funds, Inc. (the Corporation) is an open-end,
diversified investment company authorized to issue ten billion shares
of $.0001 par value capital stock. These shares are currently offered
in nine series:
- the FREMONT GLOBAL FUND
- the FREMONT INTERNATIONAL GROWTH FUND
- the FREMONT INTERNATIONAL SMALL CAP FUND
- the FREMONT EMERGING MARKETS FUND
- the FREMONT U.S. MICRO-CAP FUND
- the FREMONT GROWTH FUND
- the FREMONT BOND FUND
- the FREMONT MONEY MARKET FUND
- the FREMONT CALIFORNIA INTERMEDIATE TAX-FREE FUND
(the Fremont California Intermediate Tax-Free Fund is
available only to residents of Arizona, California, Colorado,
Nevada, New Mexico, Oregon, Texas, Utah and Washington)
Each of the Funds maintains a totally separate investment portfolio.
Significant accounting policies followed by the Funds are summarized
below. The policies are in conformity with generally accepted accounting
principles for investment companies.
A. SECURITY VALUATION
Investments, including options, are stated at value based on
recorded closing sales on a national securities exchange or, in
the absence of a recorded sale, at the mean between the last
reported bid and asked prices or at fair value as determined by
the Board of Directors. Short-term notes and similar securities
are included in investments at amortized cost, which approximates
value. Securities which are primarily traded on foreign exchanges
are generally valued at the preceding closing values of such
securities on their respective exchanges or the most recent price
available where no closing value is available.
Securities in the Fremont Money Market Fund have a remaining
maturity of not more than 397 days and its entire portfolio has a
weighted average maturity of not more than 90 days. As such, all
of the Fund's securities are valued at amortized cost, which
approximates value. If the Fund's portfolio had a remaining
weighted average maturity of greater than 90 days the portfolio
would be stated at value based on recorded closing sales on a
national securities exchange or, in the absence of a recorded
sale, at the mean between the bid and asked prices.
B. SECURITY TRANSACTIONS
Security transactions are accounted for as of trade date.
Realized gains and losses on security transactions are determined
on the basis of specific identification for both financial
statement and federal income tax purposes.
C. INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS
Dividends are recorded on the ex-dividend date, except that
certain dividends from foreign securities in the Fremont Global
Fund, the Fremont International Growth Fund, the Fremont
International Small Cap Fund and the Fremont Emerging Markets
Fund are recorded when the Fund is informed of the ex-dividend
date. Interest income and estimated expenses are accrued daily.
Bond discount and premium are amortized as required by the
Internal Revenue Code. Distributions to shareholders are recorded
on the ex-dividend date. The Corporation accounts for the assets
of each Fund separately and allocates general expenses of the
Corporation to each Fund based upon the relative net assets of
each Fund or the nature of the services performed and their
applicability to each Fund.
D. INCOME TAXES
The Funds' policy is to comply with the requirements of the
Internal Revenue Code applicable to regulated investment
companies and to distribute all taxable income and net capital
gains, if any, to shareholders. Therefore, no income tax
provision is required. Each Fund is treated as a separate entity
in the determination of compliance with the Internal Revenue Code
and distributes taxable income and net realized gains, if any, in
accordance with schedules described in their respective
Prospectuses. The portfolio of Fremont California Intermediate
Tax-Free Fund is composed solely of issues that qualify for
tax-exempt status for both Federal and State of California income
tax purposes.
Income dividends and capital gain distributions paid to
shareholders are determined in accordance with income tax
regulations which may differ from generally accepted accounting
principles and, therefore, may differ from the information
presented in the financial statements. These differences are
generally referred to as "book/tax" differences and are primarily
due to differing treatments for foreign currency transactions,
losses deferred due to wash sale rules, classification of
gains/losses related to paydowns and certain futures and options
transactions.
Permanent book/tax differences causing payments to shareholders
of income dividends which are in excess of the net investment
income reported in the financial statements will result in
reclassification of such excess to paid in capital from
undistributed net investment income. Temporary book/tax
differences, which will reverse in subsequent periods, will not
be reclassified and will remain in undistributed net investment
income. Any taxable income or gain remaining at fiscal year end
is distributed in the following year.
For Federal income tax purposes, certain funds have capital loss
carryovers at October 31, 1996. Capital loss carryovers result
when a fund has net capital losses during a tax year. These are
carried over to subsequent years and may reduce distributions of
realized gains
59
<PAGE> 62
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1997 (Unaudited)
in those years. Unused capital loss carryovers expire in eight
years. The following funds have capital loss carryovers at
October 31, 1996 which expire in the years indicated.
<TABLE>
<CAPTION>
FUND AMOUNT EXPIRES IN
---- ------ ----------
<S> <C> <C>
Emerging Markets $ 84,620 2004
Bond 242,923 2004
</TABLE>
Until such capital loss carryovers are offset or expire, it is
unlikely that the Board of Directors will authorize a distribution of any net
realized gains.
E. ACCOUNTING ESTIMATES
The preparation of financial statements in accordance with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities at the date of the financial statements
and the amounts of income and expense during the reporting
period. Actual results could differ from those estimates.
F. FOREIGN CURRENCY TRANSLATION
The market values of foreign securities, currency holdings, and
other assets and liabilities of the Fremont Global Fund, the
Fremont International Growth Fund, the Fremont International
Small Cap Fund, the Fremont Emerging Markets Fund and the Fremont
Bond Fund are translated to U.S. dollars based on the daily
exchange rates. Purchases and sales of securities, income and
expenses are translated at the exchange rate on the transaction
date. Income and withholding taxes are translated at prevailing
exchange rates when accrued or incurred.
For those Funds which are allowed by the terms of their
respective prospectuses to invest in securities and other
transactions denominated in foreign currencies, currency gain
(loss) will occur when such securities and transactions are
translated into U.S. dollars.
Certain transactions which result in realized currency gain
(loss) are reported on the Statements of Operations as Net
Realized Gain (Loss) from Foreign Currency Transactions. These
are: currency gain (loss) from the sale or maturity of forward
currency contracts and from the disposition of foreign currency;
and the realization of currency fluctuations between trade and
settlement dates on security transactions and between accrual and
receipt dates on net investment income.
Realized currency gain (loss) from the sale, maturity or
disposition of foreign securities is not separately reported from
the economic or market component of the gain (loss) and is
included under the caption Net Realized Gain (Loss) from
Investments. Activity related to foreign currency futures and
options on foreign currency is, likewise, reported under this
heading, as these instruments are used to hedge the foreign
currency risks associated with investing in foreign securities.
Consistent with the method of reporting realized currency gain
(loss), unrealized currency gain (loss) on investments is not
separately reported from the underlying economic or market
component, but included under the caption Net Unrealized
Appreciation (Depreciation) on Investments. Unrealized currency
gain (loss) on other net assets is reported under Net Unrealized
Appreciation (Depreciation) on Translation of Assets and
Liabilities in Foreign Currencies.
G. FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract is an obligation to purchase
or sell a currency against another currency at a future date and
price as agreed upon by the parties. These contracts are traded
over-the-counter and not on organized commodities or securities
exchanges. Losses may arise due to changes in the value of the
foreign currencies or if the counterparty does not perform under
the contract.
The Funds may and do use forward foreign currency contracts to
facilitate the settlement of foreign securities. A commitment by
a Fund to purchase a currency forward allows the Fund to have the
local currency on hand to settle foreign security purchases on
the payment date. Likewise, a commitment to sell a currency
forward allows the Fund to take the foreign currency proceeds
from the sale of foreign securities and exchange it for U.S.
dollars at a predetermined price.
In addition, the Fremont Global Fund and the Fremont Bond Fund
use such contracts to manage their respective currency exposure.
Contracts to receive generally are used to acquire exposure to
foreign currencies, while contracts to deliver are used to hedge
a fund's investments against currency fluctuations. A contract to
receive or deliver can also be used to offset a previous
contract.
The market risk involved in these contracts is in excess of the
amounts reflected in the Funds' Statements of Assets and
Liabilities since only the change in the underlying values is
reflected (as an asset if appreciated or as a liability if
depreciated) and not the actual underlying values.
60
<PAGE> 63
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1997 (Unaudited)
At April 30, 1997 the underlying values for open foreign currency
contracts were as follows:
<TABLE>
<CAPTION>
NET UNREALIZED
SETTLEMENT TO RECEIVE INITIAL CURRENT APPRECIATION
DATE (TO DELIVER) VALUE VALUE (DEPRECIATION)
---- ------------ ----- ----- --------------
<S> <C> <C> <C> <C> <C>
GLOBAL FUND
Australian Dollar 05/05/97 (17,000,000) $(12,989,700) $(13,277,680) $ (287,980)
Canadian Dollar 05/05/97 (22,000,000) (16,328,954) (15,743,524) 585,430
German Deutschemark 05/05/97 (16,400,000) (10,067,526) (9,473,745) 593,781
German Deutschemark 05/05/97 (39,000,000) (23,282,192) (22,529,028) 753,164
French Franc 05/05/97 (24,000,000) (4,237,513) (4,114,803) 122,710
Swedish Krona 05/05/97 (69,000,000) (9,317,525) (8,801,469) 516,056
Dutch Guilder 05/06/97 (6,500,000) (3,450,473) (3,339,842) 110,631
British Pound 06/11/97 (9,000,000) (14,472,000) (14,601,600) (129,600)
-----------
$ 2,264,192
===========
INTERNATIONAL SMALL CAP FUND
Japanese Yen 05/02/97 (3,969,100) $ (31,154) $ (31,154) $ --
Malaysian Ringgit 05/02/97 78,196 31,154 31,154 --
Malaysian Ringgit 05/02/97 30,078 12,000 12,000 --
Turkish Lira 05/02/97 (1,987,043,000) (14,719) (14,719) --
-----------
$ --
===========
EMERGING MARKETS FUND
Hong Kong Dollar 05/01/97 (351,880) $ (45,416) $ (45,424) $ (8)
Indonesian Rupiah 05/05/97 (229,388,240) (94,263) (94,399) (136)
Malaysian Ringgit 05/05/97 335,347 134,246 133,615 (631)
Singapore Dollar 05/06/97 (307,278) (212,062) (212,399) (337)
-----------
$ (1,112)
===========
BOND FUND
Canadian Dollar 05/01/97 1,000,000 $ 760,393 $ 715,999 $ (44,394)
Canadian Dollar 05/01/97 (1,000,000) (737,463) (715,999) 21,464
New Zealand Dollar 06/03/97 (3,036,000) (2,100,912) (2,102,521) (1,609)
Canadian Dollar 06/10/97 1,945,000 1,431,673 1,395,566 (36,107)
Canadian Dollar 06/10/97 (1,945,000) (1,437,812) (1,395,566) 42,246
German Deutschemark 06/12/97 (592,000) (352,381) (342,930) 9,451
-----------
$ (8,949)
===========
</TABLE>
H. FUTURES
A futures contract is an agreement between two parties to buy or
sell a security or financial interest at a set price on a future
date and is standardized and exchange-traded. Upon entering into
such a contract, the purchaser is required to pledge to the
broker an amount of cash or securities equal to the minimum
"initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the purchaser
agrees to receive from or pay to the broker an amount of cash
equal to the daily fluctuation in value of the contract. Such
receipts or payments are known as "variation margin" and are
recorded by the purchaser as unrealized gains or losses. When the
contract is closed, the purchaser records a realized gain or loss
equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed. The
Funds use futures contracts to hedge foreign currency and
interest rate risks.
At April 30, 1997, the Fremont Bond Fund had the following
futures contracts outstanding:
<TABLE>
<CAPTION>
CONTRACTS EXPIRATION INITIAL CURRENT NET UNREALIZED
TO BUY DATE VALUE VALUE (DEPRECIATION)
------ ---- ----- ----- --------------
<S> <C> <C> <C> <C> <C>
5 yr. U.S. Treasury Note 70 Jun 97 $7,389,531 $7,369,687 $(19,844)
10 yr. U.S. Treasury Note 25 Jun 97 2,684,375 2,674,219 (10,156)
30 yr. U.S. Treasury Bond 40 Jun 97 4,395,675 4,371,250 (24,425)
--------
$(54,425)
========
</TABLE>
At April 30, 1997, $350,000 par value of U.S. Treasury Bills were
held by brokers to satisfy the initial margin requirements
related to these contracts.
61
<PAGE> 64
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1997 (Unaudited)
I. SECURITIES LENDING
All the Funds are authorized to make loans of their portfolio
securities to broker-dealers or to other institutional
investors up to 33-1/3% of their respective net assets. The
borrower must maintain with the Funds' custodian collateral
consisting of cash, cash equivalents or U.S. Government
securities equal to at least 100% of the value of the borrowed
securities, plus any accrued but unpaid distributions. The
collateral is invested in a money market fund that meets the
criteria of Section 2(a)-7 of the 1940 Act.
The Funds receive a portion of the income earned on the
collateral. For the six months ended April 30, 1997, transactions
in securities lending resulted in fee income to the Fremont
Global Fund, the Fremont International Growth Fund, the Fremont
International Small Cap Fund, the Fremont Emerging Markets Fund,
the Fremont U.S. Micro-Cap Fund and the Fremont Growth Fund of
$54,947, $15,033, $1,789, $185, $24,928 and $3,771, respectively.
The market value of the securities on loan and the collateral
balance held by the Funds as of April 30, 1997 were as follows:
<TABLE>
<CAPTION>
MARKET VALUE COLLATERAL VALUE
------------ ----------------
<S> <C> <C>
Fremont Global Fund $ 67,766,645 $ 68,902,414
Fremont International Growth Fund 5,365,230 5,455,152
Fremont International Small Cap Fund 593,000 602,939
Fremont U.S. Micro-Cap Fund 16,599,809 16,878,022
Fremont Growth Fund 9,955,586 10,122,442
</TABLE>
J. REVERSE REPURCHASE AGREEMENTS
During the six months ended April 30, 1997, the Fremont Bond Fund
entered into reverse repurchase agreements with certain brokers.
Reverse repurchase agreements involve the sale of a
portfolio-eligible security by the Fund, coupled with an
agreement to repurchase the security at a specified date and
price. Reverse repurchase agreements involve the risk that the
market value of securities pledged as collateral may decline
below the repurchase price of the securities sold by the Fund
which it is obligated to repurchase.
Such transactions are accounted for as a borrowing by the Fund
and are subject to the Fund's overall restriction on borrowing
under which it must maintain asset coverage of at least 300%.
The difference between the selling price and the repurchase price
is accounted for as interest expense.
2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
INVESTMENT ADVISOR
The Funds each have entered into an investment management agreement with
Fremont Investment Advisors, Inc. (the Advisor), a wholly owned
subsidiary of Fremont Investors, Inc. (formerly The Fremont Group,
Inc.). Under these agreements, the Advisor supervises and implements
each Fund's investment activities and provides administrative services
as necessary to conduct Fund business. For its advisory and
administrative services, the Advisor receives a fee based on the average
daily net assets of the Funds as described below.
<TABLE>
<CAPTION>
ADVISORY FEE ADMINISTRATIVE FEE
<S> <C> <C>
Fremont Global Fund 0.60% on all net assets 0.15% on all net assets
Fremont International Growth Fund 1.50% on all net assets --
Fremont International Small Cap Fund 1.50% on all net assets --
Fremont Emerging Markets Fund (*) 1.00% on all net assets 0.15% on all net assets
Fremont U.S. Micro-Cap Fund (*) 2.50% on first $30 million --
2.00% on next $70 million --
1.50% on balance over $100 million --
Fremont Growth Fund 0.50% on all net assets 0.15% on all net assets
Fremont Bond Fund (*) 0.40% on all net assets 0.15% on all net assets
Fremont Money Market Fund (*) 0.30% on first $50 million 0.15% on all net assets
0.20% on balance over $50 million
Fremont California Intermediate
Tax-Free Fund (*) 0.40% on first $25 million 0.15% on all net assets
0.35% on next $25 million
0.30% on next $50 million
0.25% on next $50 million
0.20% on balance over $150 million
</TABLE>
(*)The Advisor has voluntarily waived and/or reimbursed some of its
fees for these Funds. All fees waived in the past will not be
recouped in the future and, as these waivers are voluntary, they
may be changed in the future.
62
<PAGE> 65
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1997 (Unaudited)
For the Fremont U.S. Micro-Cap Fund, the Advisor is
voluntarily limiting the advisory fee to a reduced rate of no
greater than 1.98% of net assets.
For the Fremont Emerging Markets Fund, the Advisor is
voluntarily waiving advisory, 12b-1 and administrative fees
and reimbursing all other operating expenses until further
notice.
For the Fremont Bond Fund and the Fremont Money Market Fund,
the Advisor is voluntarily waiving the administrative fee in
its entirety.
For the Fremont California Intermediate Tax-Free Fund, the
advisory and administrative fees are charged at voluntarily
reduced rates of .30% and .005% of net assets, respectively.
Selected per share data and operating ratios have been disclosed both
before and after the impact of these various waivers under each Fund's
Financial Highlights table.
Under the terms of the Advisory agreements, the Advisor receives a
single management fee (i.e., a unitary fee) from the Fremont
International Growth Fund, the Fremont International Small Cap Fund and
the Fremont U.S. Micro-Cap Fund, and is obligated to pay all expenses of
these Funds except extraordinary expenses (as determined by a majority
of the disinterested directors) and interest, brokerage commissions, and
other transaction charges relating to the investing activities of those
Funds.
Pursuant to Rule 12b-1 under the Investment Company Act of 1940, the
Fremont Emerging Markets Fund has adopted a plan of distribution under
which the Fund may directly incur or reimburse the Advisor for certain
distribution-related expenses. The maximum amount the Fund is obligated
to pay the Advisor is 0.25% of net assets. Payments have been waived by
the Advisor in their entirety since the Fund began operations and it is
anticipated that the Advisor will continue voluntarily waiving such
payments until further notice.
Each Fund is also required to comply with the limitations set forth in
the laws, regulations, and administrative interpretations of the states
in which it is registered. For the six months ended April 30, 1997, no
reimbursements were required or made to any Fund by the Advisor to
comply with these limitations.
Under the terms of a shareholder services agreement with the Advisor,
effective July 1, 1996, the Funds pay the Advisor for transfer agent
services on a per shareholder account basis, subject to a monthly
minimum per Fund as well as out-of-pocket expenses. Total costs incurred
by the Funds in aggregate for the six months ended April 30, 1997 were
$152,020, excluding funds under a unitary fee arrangement.
OTHER RELATED PARTIES
At April 30, 1997, Fremont Investors, Inc. and its affiliated companies
including their employee retirement plans, its principal shareholder,
Stephen D. Bechtel, Jr., and members of his family, including trusts,
owned directly or indirectly the following approximate percentages of
the various Funds:
<TABLE>
<CAPTION>
% OF SHARES OUTSTANDING
-----------------------
<S> <C>
Fremont Global Fund 61%
Fremont International Growth Fund 86%
Fremont International Small Cap Fund 32%
Fremont Emerging Markets Fund 51%
Fremont U.S. Micro-Cap Fund 6%
Fremont Growth Fund 66%
Fremont Bond Fund 87%
Fremont Money Market Fund 80%
Fremont California Intermediate Tax-Free Fund 71%
</TABLE>
Certain officers and/or directors of the Funds are also officers and/or
directors of the Advisor and/or Fremont Investors, Inc.
3. ORGANIZATION COSTS
Costs incurred by each Fund, if any, in connection with its
organization have been deferred and are amortized on a straight-line
basis over a period of five years (60 months).
63
<PAGE> 66
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1997 (Unaudited)
4. PURCHASES AND SALES/MATURITIES OF INVESTMENT SECURITIES
Aggregate purchases and aggregate proceeds from sales and maturities of
securities for the six months ended April 30, 1997 were as follows:
<TABLE>
<CAPTION>
PURCHASES PROCEEDS
--------- --------
<S> <C> <C>
LONG TERM SECURITIES EXCLUDING U.S. GOVERNMENT SECURITIES:
Fremont Global Fund $213,085,957 $109,640,129
Fremont International Growth Fund 19,925,735 18,919,586
Fremont International Small Cap Fund 4,130,461 3,628,020
Fremont Emerging Markets Fund 5,810,257 2,345,360
Fremont U.S. Micro-Cap Fund 91,102,134 56,288,295
Fremont Growth Fund 54,008,557 30,034,915
Fremont Bond Fund 14,705,948 27,453,665
Fremont California Intermediate Tax-Free Fund 9,012,581 510,000
LONG TERM U.S. GOVERNMENT SECURITIES:
Fremont Global Fund $13,949,316 $5,153,110
Fremont Bond Fund 35,813,937 28,314,629
</TABLE>
Transactions in written put and call options for the six months ended
April 30, 1997 for the Fremont Bond Fund were as follows:
<TABLE>
<CAPTION>
AMOUNT OF PREMIUMS NUMBER OF CONTRACTS
------------------ -------------------
<S> <C> <C>
Options outstanding at October 31, 1996 $ 70,996 50
Options sold 41,625 50
Options cancelled in closing purchase transactions -- --
Options expired prior to exercise -- --
Options exercised -- --
Options outstanding at April 30, 1997 $112,621 100
</TABLE>
The following written options were outstanding at April 30, 1997:
<TABLE>
<CAPTION>
NUMBER OF EXERCISE EXPIRATION
NAME OF ISSUER CONTRACTS PRICE DATE VALUE
-------------- --------- ----- ---- -----
<S> <C> <C> <C> <C> <C>
PUT OPTIONS: CME June 97 Eurodollar Futures 50 93.50 06/16/97 $ 1,250
CME Dec 97 Eurodollar Futures 50 93.75 12/15/97 37,500
</TABLE>
CME - Chicago Mercantile Exchange
The Bond Fund received premiums of $112,621 on these contracts and has
an unrealized gain of $73,871. The total notional value underlying
these contracts is $100,000,000.
5. PORTFOLIO CONCENTRATIONS
Although each Fund has a diversified investment portfolio, there are
certain investment concentrations of risk which may subject each Fund
more significantly to economic changes occurring in certain segments or
industries.
6. UNREALIZED APPRECIATION (DEPRECIATION) - TAX BASIS
At April 30, 1997, the cost of securities for Federal income tax
purposes and the gross aggregate unrealized appreciation and/or
depreciation based on that cost were as follows:
<TABLE>
<CAPTION>
GROSS AGGREGATE UNREALIZED
--------------------------
COST APPRECIATION DEPRECIATION NET
---- ------------ ------------ ---
<S> <C> <C> <C> <C>
Fremont Global Fund $ 571,998,869 $ 63,305,800 $ (19,432,988) $ 43,872,812
Fremont International Growth Fund 36,881,921 5,465,336 (3,095,951) 2,369,385
Fremont International Small Cap Fund 9,977,344 900,221 (1,514,959) (614,738)
Fremont Emerging Markets Fund 7,481,492 779,056 (237,625) 541,431
Fremont U.S. Micro-Cap Fund 141,084,321 13,617,628 (20,548,396) (6,930,768)
Fremont Growth Fund 105,777,790 12,396,523 (2,857,906) 9,538,617
Fremont Bond Fund 80,286,005 1,427,034 (744,851) 682,183
Fremont Money Market Fund 429,977,136 -- -- --
Fremont California Intermediate
Tax-Free Fund 58,787,613 1,373,370 (303,422) 1,069,948
</TABLE>
64
<PAGE> 67
[FREMONT FUNDS LOGO]
50 Beale Street, Suite 100
San Francisco, CA 94105
