FREMONT MUTUAL FUNDS, INC.(R)
SEMI-ANNUAL REPORT
[GRAPHIC]
April 30, 1998
Fremont
Funds [LOGO]
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FREMONT FUNDS
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A message from Michael H. Kosich, President of Fremont Mutual Funds
[PHOTO]
Mike Kosich
Dear Fellow Shareholder:
In first-half fiscal 1998, Fremont Funds launched two new equity
products--the Fremont Real Estate Securities Fund and the Fremont Select Fund.
The Fremont Real Estate Securities Fund is off to a fast start, with more than
1,000 shareholders and assets totaling over $18 million as of April 30, 1998.
In their inaugural letters to shareholders, Real Estate Securities Fund
Portfolio Manager, John Kramer, will detail his approach to the rapidly
expanding real estate securities market, and the Select Fund Portfolio
Co-Managers, John Kosecoff, Debra McNeill and Pete Landini, will describe how
they identify profitable opportunities in the mid-cap growth stock arena. I
think you will enjoy learning more about these new funds and agree that they are
welcome additions to the Fremont Mutual Funds family.
This semi-annual report will also introduce you to Capital Guardian Trust
Company (CGTC)--the new sub-advisor to the Fremont International Growth Fund;
and Bee & Associates, Inc.--the new sub-advisor to the Fremont International
Small Cap Fund. CGTC has an experienced nine-member portfolio management team
backed by a worldwide analyst team, and a long and distinguished track record in
the international equities arena. Bee & Associates has been managing
international small cap portfolios for prestigious institutional clients since
1989, and has been a performance leader in its field.
Our decision to change the portfolio managers of these two Funds was not an
easy one. We are not short-term oriented and are committed to giving all our
portfolio managers sufficient opportunity to prove themselves against their
investment benchmarks and their peers. However, we set high standards for all of
our funds and if, over time, they do not live up to our performance
expectations, we will make changes. We apologize for any concern or
inconvenience these changes may have caused shareholders. We are confident the
Fremont International Growth and International Small Cap Funds are now in very
strong hands and capable of delivering better absolute and relative returns.
I am also pleased to report that Fremont Funds is now on-line with our own
web site. Please visit us at http://www.fremontfunds.com. You can now access
daily fund prices and performance histories, and download fund prospectuses on
your computer. We will be adding additional features including account lookup
and exchanges in the months ahead.
Sincerely,
/S/ Michael H. Kosich
Michael H. Kosich
June 15, 1998
This report, including the statements of investments and financial statements,
is submitted for the general information of the shareholders of Fremont Mutual
Funds, Inc. This report is not authorized for distribution and may not be used
as sales literature, unless preceded or accompanied by a prospectus.
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FREMONT FUNDS
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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 U.S. Small Cap Fund.................................................. 16
Fremont Select Fund.......................................................... 18
Fremont Growth Fund.......................................................... 20
Fremont Real Estate Securities Fund.......................................... 22
Fremont Bond Fund............................................................ 24
Fremont Money Market Fund.................................................... 26
Fremont California Intermediate Tax-Free Fund................................ 28
Statements of Investments
Fremont Global Fund.......................................................... 31
Fremont International Growth Fund............................................ 37
Fremont International Small Cap Fund......................................... 39
Fremont Emerging Markets Fund................................................ 40
Fremont U.S. Micro-Cap Fund.................................................. 41
Fremont U.S. Small Cap Fund.................................................. 43
Fremont Select Fund.......................................................... 44
Fremont Growth Fund.......................................................... 45
Fremont Real Estate Securities Fund.......................................... 47
Fremont Bond Fund............................................................ 48
Fremont Money Market Fund.................................................... 50
Fremont California Intermediate Tax-Free Fund................................ 52
Country Diversification and Portfolio & Currency Abbreviations............... 54
Combined Financial Statements
Statements of Assets and Liabilities......................................... 56
Statements of Operations..................................................... 60
Statements of Changes in Net Assets.......................................... 64
Financial Highlights......................................................... 68
Notes to Financial Statements................................................ 74
1
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FREMONT FUNDS
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FREMONT GLOBAL FUND
The Fremont Asset Allocation Committee,
Portfolio Managers for Fremont Global Fund
Dave Redo, Pete Landini, Bob Haddick, Sandie Kinchen, Al Kirschbaum
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FUND PROFILE
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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 to maximize total return
(including income and capital gains) while reducing risk by investing in
multiple categories of U.S. and foreign securities.
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
[PHOTO]
The Fremont Asset Allocation Committee (clockwise from top left)
Dave Redo, Pete Landini, Al Kirschbaum, Bob Haddick, Sandie Kinchen
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.
To Our Shareholders,
For the six months ended April 30, 1998, Fre-
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Fremont Global Fund Investment Returns
Annual Returns
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%
11/01/96-10/31/97 +13.01%
11/01/97- 4/30/98* +10.43%
Growth of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since November 18, 1988 of a $10,000
investment in the Fremont Global Fund, S&P 500 Index, Salomon Non-U.S. Govt Bond
Index (Currency Hedged), Lehman Bros. Intermediate Govt./Corp. Bond Index and
the MSCI EAFE Index.
4/30/98
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S&P 500 Index $54,170
Fremont Global Fund $26,856
Salomon Non-U.S. Govt Bond Index (Currency Hedged) $21,499
Lehman Bros. Intermediate Govt./Corp. Bond Index $21,255
MSCI EAFE Index $16,885
Average Annual Returns for the Periods Ended 4/30/98
Since Inception
1 Year 5 Years 11/18/98
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17.32% 12.45% 11.03%
* 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
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FREMONT FUNDS
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Fremont Global Fund
Geographic Diversification as of April 30, 1998
[GRAPHIC OMITTED]
Canada 2.9%
United States 63.6%
Emerging Markets - Latin America 3.0%
Emerging Markets - Other 3.6%
Europe 23.6%
Japan 1.5%
Pacific Rim 1.8%
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mont Global Fund returned 10.43% compared to its benchmark, the Lipper Global
Flexible Fund Average's 10.80%.
During first-half fiscal 1998, the Fund's 46% weighting in U.S. stocks was
a distinct plus, with the Dow Jones Industrials and S&P 500 exceeding the most
optimistic forecasts. Our bias toward value sectors was a mixed blessing. The
Fund's overweighting in the financial services group helped returns, but our
commitment to utilities and energy stocks was counterproductive. On a relative
return basis, our underweighting in higher price/earnings ratio technology and
consumer non-durable stocks worked against us as better-than-expected earnings
gains fueled even higher prices in what we viewed as already rich market
sectors. With the market indices at record levels, we are still more comfortable
in value sectors and believe our energy investments will rebound as oil prices
recover from five-year lows in the year ahead.
Our decision in late 1997 to move assets out of Southeast Asia and into
European stock markets (at the close of this reporting period, approximately 68%
of the Fund's foreign equity component) was a timely one. Over the last four
months, our investments in Italy, Spain and Portugal performed extremely well
and our selections in developed nations like France, Germany and the U.K. were
also rewarding. Recently, we have taken some profits in Italy, Spain and
Portugal, and added to our positions in the U.K., where we believe interest
rates are close to peaking.
In reducing the Fund's exposure to Southeast Asia to just about 12% of the
international stock portfolio, we received only limited benefit from the strong,
but brief "relief rally" in these markets. Our feeling is that if you drop
something from a 30-story building, when it lands, it's going to bounce. The
initial investor euphoria upon realizing Southeast Asia was not going to sink
into the Pacific was short-lived and these markets have trended down since late
January. We think it will be at least 12 months before Southeast Asian economies
begin recovering and we plan to stay largely on the sidelines until we see some
real evidence of economic improvement. As our modest 7% exposure (of the foreign
equity component) to Japanese stocks reflects, we are underwhelmed by the
government's recently announced economic stimulus package. If more of this money
were going to consumers via tax cuts and less into public work projects we might
be a bit more enthusiastic. But, we don't think this package provides enough
juice to jump-start Japan's moribund economy and stock market. Fragile
currencies and slowing growth makes us lukewarm on Latin America (just 4% of
foreign stock assets) as well.
On the bond side, our investments are split almost 50/50 between U.S. and
foreign securities. Relative
(continued of page 4)
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FREMONT FUNDS
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The Changing Fremont Global Fund Asset Mix
Asset Mix Asset Mix Asset Mix
Asset Class 4/30/98 10/31/97 10/31/96
Stocks
U.S 46% 48% 30%
Foreign 21% 21% 22%
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Total Stocks 67% 69% 52%
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Bonds
U.S 15% 14% 6%
Foreign 17% 15% 16%
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Total Bonds 32% 29% 22%
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Cash Reserves 1% 2% 26%
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Total 100% 100% 100%
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to our benchmark, the Fund is overweighted in the U.S. and somewhat
underweighted in Europe. Ten-year U.S. Treasuries still have a 75-80 basis point
yield advantage (0.75%-0.80%) over comparable German bonds and we don't see this
gap narrowing in the foreseeable future. With less-developed European nation
bonds now trading at relatively modest credit spreads to Germany, we have been
taking profits in places like Ireland, Italy and Spain. We believe interest
rates will stabilize in the U.K., making this market more interesting. We also
like New Zealand, where the ten-year government bonds are yielding about 1.2%
more than comparable maturity U.S. Treasuries--despite inflation of just around
1.8%. Our only real exposure to emerging market debt is in Latin America and we
are comfortable with our positions in Mexico, Argentina and Brazil. We are also
maintaining our positions in Australia and Canada, where real rates of return
(the spread between yields and inflation) remain attractive.
We have selected one U.S. and one European stock to illustrate our
investment discipline. We remind you that these should not be considered
recommendations and that we may change our opinion on these stocks if
fundamentals deteriorate or they get too pricey. For the first time since
deregulation, domestic airlines appear capable of earning money through the
cycle. Our current favorite is AMR Corp., parent of American Airlines. Recently,
AMR and U.S. Airways announced a marketing alliance that will link their
frequent-flyer programs. This should help American improve its competitive
position in the Northeast and bring aboard more high fare business travelers. We
are forecasting a 8.3% five-year annual earnings growth rate compared to 6.9%
for the airline group as a whole. Yet, AMR currently trades at 11 times
earnings, a substantial discount to the airline group's 14 price/earnings ratio
and the S&P's P/E of around 27.
Finland's Nokia is one of the world leaders in mobile phone manufacturing.
The company's research and development efforts have consistently produced
innovative new products that have kept Nokia in the technological forefront of
its industry. Despite the economic woes in Southeast Asia, global demand for
Nokia's mobile phones is strong and the company recently announced that first
quarter 1998 earnings increased by 87%. This has not gone unnoticed and the
stock has performed quite well. However, we still think it trades at a
reasonable price, particularly when compared to the price/earnings ratios of
dominant market share growth companies in the U.S.
In closing, the Fund's commitment to the U.S. equities market has continued
to reward us. As prudent investors, we are concerned about historically high
stock valuations. However, we believe the combination of low inflation, low
interest rates and good corporate earnings growth will help the market trend
higher, albeit not at the breathtaking pace we have enjoyed so far this year. We
continue to overweight European stocks and underweight Japanese and Southeast
Asian equities; a strategy that worked well for us during this reporting period
and we believe will remain effective for the balance of the year. While returns
from bonds have paled versus equities, we continue to view our fixed income
portfolio as an important anchor for the Fund.
Sincerely,
/s/ Dave Redo /s/ Pete Landini
/s/ Robert J. Haddick /s/ Sandie Kinchen
/s/ Al Kirschbaum
The Fremont Asset Allocation Committee
Portfolio Managers, Fremont Global Fund
4
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FREMONT FUNDS
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FREMONT INTERNATIONAL GROWTH FUND
David Fisher, Portfolio Manager
Capital Guardian Trust Company
Capital Guardian Trust Company Portfolio Management Team
[PHOTO] [PHOTO] [PHOTO] [PHOTO] [PHOTO]
David I. Fisher Hartmut Giesecke Nancy J. Kyle Nilly Sikorsky Robert Ronus
[PHOTO] [PHOTO] [PHOTO] [PHOTO]
John McIlwraith Lionel M. Sauvage Rudolf M. Staehelin Richard N. Havas
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FUND PROFILE
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Now under the management of Capital Guardian Trust Company (CGTC), the
Fremont International Growth Fund seeks long-term growth of capital and future
income by investing primarily in the stocks of companies based outside the
United States. The fund generally emphasizes strong, well-managed companies in
Europe, Canada, Australia and the Far East.
CGTC manages more than $70 billion in assets and is one of the The Capital
Group Companies. The Capital organization traces its roots back to 1931 and is
among the nation's oldest, largest and most successful money management
organizations. The Capital Group Companies are known for their history of
consistently superior long-term investment results, substantially due to their
unparalleled global research network.
(continued on page 6)
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Fremont International Growth Fund Investment Returns
Annual Returns
3/01/94-10/31/94* +2.30%
11/01/94-10/31/95 +0.13%
11/01/95-10/31/96 +7.07%
11/01/96-10/31/97 -0.01%
11/01/97- 4/30/98* +11.42%
Growth of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since March 1, 1994 of a $10,000 investment in
the Fremont International Growth Fund and the MSCI EAFE Index.
4/30/98
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Fremont International Growth Fund $12,219
MSCI EAFE Index $13,831
Average Annual Returns for Periods Ended 4/30/98
Since Inception
1 Year 3 Years 3/1/94
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6.99% 8.00% 4.93%
* 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.
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5
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FREMONT FUNDS
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Fremont International Growth Fund
Geographic Diversification as of April 30, 1998
[Graphic Omitted]
Canada 7.3%
United States 3.9%
Emerging Markets - Latin America 3.3%
Other Emerging Markets:
Including South Africa,
Portugal And The Philippines 2.7%
United Kingdom 14.5%
Continental Europe 41.4%
Japan 17.0%
Hong Kong/Taiwan/Singapore 4.8%
Australia 5.1%
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CGTC employs a multiple portfolio manager system. Nine individual portfolio
managers and the collective research analyst team are each given a portion of
the portfolio's assets to manage. The investment styles of the portfolio
managers vary. However, they have a unifying investment objective--superior
long-term returns versus the same benchmark index. The entire portfolio is
carefully monitored to ensure sufficient regional and country diversification.
The Capital Group Companies' money management affiliates have been using this
unique team approach for 40 years with enviable results.
To Our Shareholders,
For the six months ended April 30, 1998, the Fremont International Growth
Fund returned 11.42% compared to its benchmark, the Morgan Stanley Capital
International Europe, Australia and Far East (EAFE) Index's 15.44% gain.
Following is a statement from David Fisher, Chairman of the Board of Capital
Guardian Trust Company, and lead manager for the Fremont International Growth
Fund.
CGTC assumed management of the Fund just nine weeks from the end of this
reporting period. We thank Fremont for giving us the opportunity to demonstrate
our collective investment skills.
I will begin by introducing myself--David Fisher--and my colleagues from
around the world: Nilly Sikorsky, Hartmut Giesecke, Robert Ronus, Richard Havas,
John McIlwraith, Lionel Sauvage, Rudolph Staehelin and Nancy Kyle. We operate
from six offices located in Los Angeles, San Francisco, New York, London, Geneva
and Singapore. As you can probably tell from some of our portfolio managers'
relatively exotic names, we are a diverse group by nationality. Some of us have
been in this business longer than others--four of us including myself have been
with CGTC for more than 20 years--but all of us have extensive experience in
international equities investing. We are supported by a team of talented
research analysts some of whom also collectively manage a portion of the
portfolio.
Our multiple portfolio manager system is somewhat unique. Each portfolio
manager is given a portion of the Fund's assets to manage. We all share the same
goal--superior long-term performance. We believe this system has several
advantages for shareholders. It offers diversification in investment styles. It
promotes a very focused approach in which every stock in the portfolio is
closely looked after by the person(s) who know it best. It also reduces overall
portfolio volatility--over any given period, the Fund's performance will never
be as good as that of best performing segment of the portfolio or as bad as the
worst. Importantly, this system sustains the entrepreneurial spirit of our firm.
Our portfolio managers' compensation is determined directly by investment
results. That is what talented people in
6
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FREMONT FUNDS
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the investment industry want and deserve. In giving portfolio managers and
analysts the freedom and financial incentive to succeed, we have developed and
maintained a dedicated, highly motivated team.
We build portfolios independently. However, we monitor the entire portfolio
to ensure there is not excessive duplication in individual securities and to
maintain sufficient industry and country diversification. Although we pick
stocks not countries, we are always aware of any significant over or
underweightings in the portfolio. Our largest concentrations now are in the U.K.
and Japan at around 14.5% and 17.0%, respectively. The portfolio has 4%-8%
weightings in Canada, France, Germany, Sweden, Switzerland, Netherlands,
Australia and Italy; 2-4% weightings in Hong Kong and Mexico; a 1.3% weighting
in Brazil, and smaller weightings in a number of other countries. Although this
may change, we currently have very limited exposure to emerging markets in
Southeast Asia.
To demonstrate how all this meshes, let me compare my approach to that of
one of my longtime colleagues Nilly Sikorsky. I've always been a buy-and-hold
investor who is willing to pay a premium for high quality, well-managed
companies. Nilly has more of a value bias and trades more frequently.
Interestingly, over the long period we have worked together, these two
distinctly different styles have produced very similar results.
Although we don't generally own the same stocks, recently Nilly and I both
had positions in Holderbank, a Swiss-based global cement company. Our
perspectives were quite different. Please be aware this is not a recommendation
and we may change our opinion on this security if circumstances warrant it.
Holderbank is the third largest cement company in the world and an old favorite
of mine. Management has a terrific long-term track record and consequently, the
stock has rarely been a glaring fundamental bargain. Nevertheless, it has been
an excellent long-term investment for me and one that I may continue to own for
many years to come. Nilly bought Holderbank when it sold off in response to the
Southeast Asian economic crisis and became fundamentally inexpensive. We both
believe she has gotten in at a very opportunistic time--the company is taking
advantage of economic weakness in Southeast Asia to add to its production
capacity at bargain basement prices. Nilly will probably sell when investors
recognize the benefits of this strategy and the stock moves out of her value
range.
The point I am making is that we believe our portfolio managers' different
styles are complimentary, not contradictory. We may all travel down different
roads, in different vehicles, going at different speeds, but the destination is
the same--superior long-term returns.
In closing, on behalf of all my colleagues let me thank you once again for
entrusting a portion of your assets to us. We are dedicated to achieving our
shared investment objectives.
Sincerely,
David Fisher
Capital Guardian Trust Company
Portfolio Manager
Fremont International Growth Fund
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Fremont International Growth Fund
Sector Allocation as of April 30, 1998
[Graphic Omitted]
Short-Term Securities 3.9%
Other 12.2%
Raw Materials 5.0%
Retail 5.5%
Multi-Industry 6.3%
Energy 6.5%
Consumer Non-Durables 6.7%
Financial Services 16.2%
Utilities 12.1%
Technology 10.9%
Capital Goods 7.8%
Health Care 6.9%
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7
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FREMONT FUNDS
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FREMONT INTERNATIONAL SMALL CAP FUND
Bruce B. Bee, Portfolio Manager
Bee & Associates, Inc.
[PHOTO]
Bruce B. Bee
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FUND PROFILE
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The Fremont International Small Cap Fund is a concentrated portfolio of
small cap stocks believed to be undervalued relative to growth prospects and
intrinsic value measurements.
Through intensive fundamental analysis and "kick the tires" research, Fund
management seeks to identify a few extraordinary small companies with the
potential to grow much larger. Value--as determined by traditional measurements
like price/earnings, price/cash flow and price/book value ratios, cross border
comparisons, and the analysis of transactions within the target company's
industry--is a primary consideration in the stock selection process.
Founded in 1989, sub-advisor Bee & Associates, Inc. manages money for
prestigious private clients including the Rockefeller Family Fund, Dartmouth
College, and Pfizer. Chief Investment Officer Bruce Bee has been investing in
international equities since 1980.
To Our Shareholders,
For the six months ended April 30, 1998, the Fremont International Small
Cap Fund declined 0.44% compared to Salomon Brothers Extended Market Index of
Europe and Pacific Countries' (EMI-EPAC) 10.33% gain.
Bee & Associates, Inc. formally took over management of the Fund on March
2, less than two months prior to the end of this six-month reporting period. My
two colleagues, Adam Schor and Jason Yee, and I have spent most of this time
reshaping the portfolio. So, any comments on first half fiscal 1998 performance
would not be very meaningful.
In this, our first letter to shareholders, we want to emphasize that our
approach is quite different from our predecessor's and that we have changed the
portfolio rather dramatically.
When we inherited the Fund and reviewed the portfolio, we saw a list of
more than 200 stocks that were selected largely by sophisticated quantitative
analysis. While many of these stocks may have been excellent investments, few
matched our style and we requested they be liquidated so that we could start
with a clean slate. We run concentrated portfolios--when fully invested, we
expect the Fund to own
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Fremont International Small Cap Fund Investment Returns
Annual Returns
6/30/94-10/31/94* -1.40%
11/01/94-10/31/95 -7.96%
11/01/95-10/31/96 +13.69%
11/01/96-10/31/97 -14.56%
11/01/97- 4/30/98* -0.44%
GROWTH OF $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since June 30, 1994 of a $10,000 investment in
the Fremont International Small Cap Fund and the Salomon Brothers EMI Index.
4/30/98
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Fremont International Small Cap Fund $ 8,777
Salomon Brothers EMI Index $11,601
Average Annual Returns for Periods Ended 4/30/98
Since Inception
1 Year 3 Years 6/30/94
------ ------- -------
-12.95% -0.65% -3.35%
* 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
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FREMONT FUNDS
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Fremont International Small Cap Fund
Geographic Diversification as of April 30, 1998
[GRAPHIC OMITTED]
United States 30.7%
(Cash 13.32%)
Other Emerging Markets:
Including Portugal and Thailand 5.2%
United Kingdon 28.9%
Continental Europe 17.9%
Middle East 4.0%
Hong Kong and Singapore 13.3%
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25-35 names. These stocks will be selected based on our fundamental research,
not computer models.
If I may borrow from the U.S. Marines' recruiting slogan, we are looking
for a relatively few exceptional small companies that have the mettle to become
portfolio holdings. We run investment candidates through a tough fundamental
obstacle course. They must clear our hurdle rates on revenue and cash flow
growth, and return on equity. We insist they have special qualities like a
proprietary product or service benefiting from strong macro growth trends.
Management must be deep and know where it wants to take the company--something
we try to confirm by going out and meeting with them. Finally, and perhaps most
importantly, the stock has to be a true bargain. We use traditional fundamental
criteria to determine value. We also do cross border comparisons--examining
valuations for very similar companies in different international markets.
Finally, we analyze transactions. What company A is willing to pay for company B
often tells us a lot about the real world economic value of company C.
If we were large cap investors, it might be difficult to build a
concentrated portfolio of stocks that qualify on all these counts. Fortunately,
we are operating in the small cap arena where some great companies don't show up
on analysts radar screens or aren't yet large enough to attract institutional
sponsorship. Some consultants have labeled us as growth, rather than value
investors. We have shown that in the international small cap arena, you can be
both.
That's the philosophy. Now let's translate it into an example of the kind
of stocks we want to own. Hung Hing Printing is based in Hong Kong, with
operations in China. The company prints paper boxes and corrugated cartons;
trades paper products, and manufactures corrugated cartons. Hung Hing has almost
1,000 corporate customers, including leading multi-nationals like Colgate,
Coca-Cola, Hasbro, Nestle and Kellogg. Thus far, the turmoil in Asia has not
hurt the company's incoming orders, which increased 31% in the first half of the
current fiscal year. Hung Hing benefits from falling paper prices, which
declined 5-10% in 1997 and are projected to drop another 10-15% in 1998.
Over the five-year period ended March 31, 1997, revenues increased at an
annual rate of 13.4%, net profits by 21.3%, book value by 17.8% and dividends by
25.8%. For fiscal year 1998, ending March 31, we expect Hung Hing to report
revenue growth of approximately 25%, an earnings gain of around 18.5%, and a 15%
increase in cash
(continued of page 10)
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dividends per share. Despite the company's excellent operating track record and,
in our opinion, very good prospects going forward, Hung Hing stock trades at 8.5
times 1998 earnings projections; just 1.5 times expected year-end book value;
and yields 6.7%. Interestingly, Hung Hing stock is still below the price
investment banker Goldman Sachs paid for 9% of the company in June 1997. Bear in
mind, we may change our opinion on Hung Hing without notification. But, right
now it has most of the qualities we look for in an investment.
I trust I have given you a good feel for what we do. We are confident our
discipline will be productive in the years ahead.
Sincerely,
/S/ Bruce B. Bee
Bruce B. Bee
Portfolio Manager
Fremont International Small Cap Fund
10
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FREMONT FUNDS
- --------------------------------------------------------------------------------
FREMONT EMERGING MARKETS FUND
Henry L. Thornton, Portfolio Manager
Nicholas-Applegate Capital Management (Hong Kong) LLC
[PHOTO]
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 in
building 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 International
Group Nicholas Applegate, is widely recognized as an expert in emerging market
investing. Based in London, Henry draws on Nicholas Applegate's experienced team
of analysts in London, Hong Kong, Singapore, San Diego and Houston.
To Our Shareholders,
For the six months ended April 30, 1998, the Fremont Emerging Markets Fund
returned 2.25% compared to its benchmark, the Morgan Stanley Capital
International Emerging Markets Free (MSCI-EMF) Index's 3.64%, and the IFC
Investable Index's 3.59% gains.
Our decision last summer to significantly reduce the Fund's Southeast Asian
exposure and build a cash cushion worked to our great advantage when these
markets collapsed in October. The Fund's modest 3.32% decline during second half
fiscal 1997, (compared to losses exceeding 17% for our benchmark indices),
reflected our timely exit from the region. This strategy continued to work in
our favor until Southeast Asian markets rallied in early 1998. The big bounce
off 1997 lows did not come
(continued on page 12)
- --------------------------------------------------------------------------------
Fremont Emerging Markets Fund Investment Returns
Annual Returns
6/24/96-10/31/96* -3.12%
11/01/96-10/31/97 +12.55%
11/01/97- 4/30/98* +2.55%
Growth of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since June 24, 1996 of a $10,000 investment in
the Fremont Emerging Markets Fund and the MSCI Emerging Markets Free Index.
4/30/98
-------
Fremont Emerging Markets Fund $11,150
MSCI Emerging Markets Free Index $ 8,846
Average Annual Returns for Periods Ended 4/30/98
Since Inception
1 Year 6/24/96
------ -------
-1.14% 6.07%
* 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
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FREMONT FUNDS
- --------------------------------------------------------------------------------
Fremont Emerging Markets Fund
Geographic Diversification as of April 30, 1998
[GRAPHIC OMITTED]
United States (Cash) 1.8%
Latin America:
Including Brazil, Mexico and Argentina 26.0%
Emerging Markets:
Including Israel, Jordan and South Africa 13.1%
Europe:
Including Russia, Hungary and Poland 26.8%
Pacific Rim:
Including Hong Kong, Thailand and Taiwan 32.3%
- --------------------------------------------------------------------------------
as a complete surprise to us--we had begun cautiously moving back into Southeast
Asia in December. However, we were a little late to realize the full benefit of
the initial recovery. In short, we were extremely fortunate to have escaped much
of the damage sustained by these markets in late 1997, but not fortunate enough
to have bought back in at the bottom. However, when you add it all up, over the
last twelve months, our "better safe than sorry" posture toward Southeast Asia
was a real blessing.
We have rebuilt positions in Southeast Asia and at the end of this
reporting period, they represent 32.3% of the Fund's assets. The balance of
assets are in Europe; 39.9% (we include our middle Eastern investments in this
category), 26% in Latin America, and 1.8% in cash.
We are growth investors and considering the fact that there is still little
or no growth in Southeast Asian economies, our move back into the region may
seem premature. However, we have been buying companies that we believe are
well-positioned to grow earnings when Southeast Asian economies begin recovering
later this year. And, importantly, we have been able to do so at extremely
attractive prices relative to long-term growth potential. We will have to be
patient with these investments for the next few months. But, beginning in third
quarter 1998, we expect to see more favorable growth
CHANGES TO THE ASSET ALLOCATION OF THE EMERGING MARKETS FUND
(PERCENT OF PORTFOLIO)
Asia Latin America Eastern Europe Cash
---- ------------- -------------- ----
April 30, 1997 48.7% 27.8% 4.5% 19.0%
September 15, 1997 24.0% 35.0% 26.0% 15.0%
October 31, 1997 20.9% 32.8% 24.8% 21.5%
April 30, 1998 32.3% 26.0% 39.9% 1.8%
12
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FREMONT FUNDS
- --------------------------------------------------------------------------------
projections from economists and equity analysts that will begin attracting
investors attention and justify our increased allocation in the region.
We have been fairly aggressive in Thailand, one of the hardest hit
economies and stock markets in Asia. The domestic economy is still in terrible
shape and we don't expect much from the Thai stock market index, which is
dominated by banks and property companies still in critical condition. However,
selected exporters with costs that are in baht and revenues in dollars, should
be reporting some very nice earnings gains, which we believe will be noticed.
Our largest commitment in Southeast Asia remains Hong Kong, where we have
focused on companies serving China. The Chinese economy is slowing, and some of
the growth we anticipated this year may be postponed until 1999. However, we
believe our patience will be rewarded. The balance of our Southeast Asian
portfolio is in Taiwan, India and some relatively small investments in Korea,
Indonesia and Singapore.
Our returns from emerging markets in Europe were mixed. The Russian market
in general has been hurt by Mr. Yeltsin's political shenanigans and our
investments in Russian energy stocks suffered with the decline of oil prices to
5 year lows. However, Russian oil companies continue to represent one of the
cheapest ways to buy energy assets in the world, and we expect oil prices and
our Russian energy investments to rebound in the year ahead.
We largely missed the big move in Greece. Our concern over currency
devaluation proved justified, however, Greek stocks were swept up in the
euphoria surrounding European Economic Union. Our investments in Hungary and
other former Soviet Bloc markets boosted returns.
In Latin America we continue to favor Brazilian privatizations particularly
in the utilities industry. The Brazilian real may be somewhat overvalued and the
economy sluggish, but the earnings growth potential of recession resistant
utilities under private sector management is still very appealing. We are
underweighted in Mexico, which has made a strong recovery from the devaluation
of the peso in late 1994. However, we believe Mexico is particularly vulnerable
to competition from Southeast Asia in their primary export markets.
As is our custom, I will briefly detail one of our current portfolio
holdings that demonstrates our investment discipline. Bear in mind, we may
change our opinion on this stock if fundamentally warranted. Hapoalim Bank is an
Israeli bank. On a price/book value basis, Israeli banks have always looked
cheap. Until recently, they deserved to be. The Israeli banking system was
closed, bureaucratic and regulated. This is changing, allowing banks like
Hapoalim Bank to cut costs and significantly increase return on equity (ROE).
Given falling risk-free returns, in line with declines in inflation and interest
rates, there is potential for an expansion in price-to-book value multiples. So,
the two things that drive bank stock valuations worldwide, ROE and price-to-book
multiples, are both headed in the right direction. We bought Hapoalim stock at
around 1.1 times book value. It is now trading around 1.3 times book. We think a
price/book valuation of around 2 is more appropriate. If it gets there, we will
earn a nice return on our investment.
In closing, reducing our exposure in Southeast Asia early and getting back
in a little late was an acceptable trade-off. We have rebuilt our investment
inventory in the region at valuations we are considerably more comfortable with.
We expect to be rewarded for our efforts in the year ahead. We believe an
economic and market recovery in Southeast Asia will help renew interest in the
emerging markets in general and benefit our European and Latin American holdings
as well.
Sincerely,
/S/ Henry Thornton
Henry Thornton
Portfolio Manager
Fremont Emerging Markets Fund
13
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FREMONT FUNDS
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FREMONT U.S. MICRO-CAP FUND
Robert E. Kern, Portfolio Manager
Kern Capital Management LLC
[PHOTO]
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 macro-economic
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 senior trader works hand-in-hand with the portfolio
management team to execute strategies that 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, 1998, the Fremont U.S. Micro-Cap Fund
returned 4.75% compared to the Russell 2000's 11.88%.
In previous letters to you, we've been able to talk extensively about what
went right in the portfolio. That is one of the privileges of having some very
good absolute and relative performance numbers. This time around, we will be
equally forthright and confront what went wrong. Let me begin by explaining that
the Fund only modestly trailed its Russell 2000 benchmark in the first four
months of 1998. However, we underperformed this index in
- --------------------------------------------------------------------------------
Fremont U.S. Micro-Cap Fund Investment Returns
Annual Returns
6/30/94-10/31/94* +3.60%
11/01/94-10/31/95 +38.68%
11/01/95-10/31/96 +41.46%
11/01/96-10/31/97 +28.80%
11/01/97- 4/30/98* +4.75%
Growth of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since June 30, 1994 of a $10,000 investment in
the Fremont Micro-Cap Fund and the Russell 2000 Index.
4/30/98
-------
Fremont U.S. Micro-Cap Fund $27,425
Russell 2000 Index $21,262
Average Annual Returns for Periods Ended 4/30/98
Since Inception
1 Year 3 Years 6/30/94
------ ------- -------
34.19% 34.01% 30.11%
* 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>
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FREMONT FUNDS
- --------------------------------------------------------------------------------
November/December 1997. The primary culprit was our technology exposure. The
technology stock group across the market capitalization spectrum really got hit
hard in October on the heels of the Asian currency crisis. While many of the
larger technology stocks have done well recently, the Fund's micro-cap
technology investments have underperformed. In addition, earnings
disappointments have hurt the Fund's overall performance.
We have been in a period of stock market leadership by large companies,
usually the larger the better. To wit, during first quarter 1998, the 100
largest companies on NASDAQ returned 23.2% compared to the NASDAQ Composite's
16.9% gain. That is quite a difference and one that clearly demonstrates that
big has been beautiful even in the small cap market. With these gains in big
small cap stocks, if you will forgive the oxymoron, investors have had little
incentive to move down the capitalization ladder into micro-caps. We can't be
sure when this will change.
That's the bad news. The good news is we believe we've found a lot of great
micro-cap bargains. Rather than discussing just one portfolio company that
demonstrates our investment discipline, we've chosen three--one each from the
technology, consumer, and services sectors of the portfolio. These sectors are
characterized by a high level of innovation, and along with health care
represent the primary areas of focus for the Fund's investment management team.
The current environment for many health care companies has been challenging and
the Fund currently has a relatively low portfolio weighting in this sector.
Thus, we will wait for a future report to highlight one of the Fund's health
care investments.
Orckit Communications has developed proprietary digital subscriber line
(xDSL) technology for increasing the capacity of copper telephone lines to
transmit digital information. This technology is designed to provide what
everyone wants--a faster internet. GTE recently announced it has chosen Orckit's
technology. This win, combined with other successes in the international market,
represents a strong endorsement from leading communications companies around the
world. Judging from the stock's current price, Wall Street does not yet know or
care about Orckit. We expect this to change.
Star Buffet is a tiny ($90 million market cap) restaurant company spun off
from CKE Restaurants. The buffet style restaurant field has been real crowded
and the marginal competitors have been struggling. Star Buffet has been picking
them off at very cheap prices. They clean them up, install new management,
generate cost efficiencies through purchasing clout, and start making money.
Star Buffet management wants to build a big profitable company and we think they
are going to succeed.
NuCO2 is attempting to revolutionize its industry. The carbon dioxide used
in beverage dispensers in bars and restaurants has traditionally been delivered
in small, but very heavy high pressure cylinders that are expensive to transport
to sites and retrieve for refilling, take up valuable storage space, and are
inconvenient for restaurant workers to change when they run out of gas. NuCO2
provides bulk tanks of carbon dioxide for carbonated beverage dispensers. This
service reduces the hassle for restaurant owners and through an aggressive
acquisition program, NuCO2 has developed a strong national franchise. Management
is now emphasizing improving profitability and we anticipate the stock will
start to reflect this change.
In closing, we are not pleased with the Fund's return in this reporting
period. Going forward, we plan on doing what we've always done--work hard to
identify small companies with big growth potential. We remain confident in our
ability to do so and to provide long-term "value-added" performance for the
Fund's shareholders.
Sincerely,
/S/ Robert E. Kern
Robert E. Kern
Portfolio Manager
Fremont U.S. Micro-Cap Fund
15
<PAGE>
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FREMONT FUNDS
- --------------------------------------------------------------------------------
FREMONT U.S. SMALL CAP FUND
David G. Kern, CFA, Portfolio Manager
Kern Capital Management LLC
[PHOTO]
David Kern
- ------------
Fund Profile
- ------------
Domestic small cap stocks offer tremendous opportunity for professional
investors dedicated to hands-on fundamental research. Through rigorous
fundamental analysis, including visits with corporate managements, their
suppliers, customers and competitors, Fund management strives to identify small
relatively unknown companies with the potential to become larger and more
successful entities over time.
Research is concentrated in industries with the highest level of innovation
such as technology, health care, consumer products, and services. The research
process focuses on answering three basic questions: how attractive is the
business; how strong is management; and how much is the company worth?
Portfolio Manager David G. Kern inherits his enthusiasm and aptitude for
small cap investing from his father and fellow principal in Kern Capital
Management LLC, Robert E. Kern--one of the most respected small company
investors in the business. David has spent the last twelve years honing his
skills as a small cap stock analyst and portfolio manager, most recently serving
as vice president and portfolio manager with Founders Asset Management, Inc.
To Our Shareholders,
For the six months ended April 30, 1998, the Fremont U.S. Small Cap Fund
returned 14.25% versus its benchmark, the Russell 2000 Index's 11.88% gain.
Performance for the Fund, and the small cap stock market in general, was
sluggish in late 1997, primarily due to the technology sector's weakness in the
aftermath of the Southeast Asian currency crisis. As always, and especially
during this turmoil, we focused on companies whose success is much more
dependent on internal business developments than macro-economic events.
Positioning at the end of 1997 allowed the Fund to post excellent performance in
the first four months of 1998. Our portfolio is organized into what we view as
the four most innovative sectors in the U.S. economy: technology,
- --------------------------------------------------------------------------------
Fremont U.S. Small Cap Fund Investment Returns
Returns
9/24/97-10/31/97* -4.06%
11/01/97-4/30/98* +14.25%
Growth of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since November 24, 1997 of a $10,000
investment in the Fremont U.S. Small Cap Fund and the Russell 2000 Index.
4/30/98
-------
Fremont U.S. Small Cap Fund $10,961
Russell 2000 Index $10,806
Return for Period Ended 4/30/98
Since Inception
9/24/97
-------
9.61%*
* Unannualized
+ Assumes initial investment of $10,000 on inception date, September 24, 1997.
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.
16
<PAGE>
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FREMONT FUNDS
- --------------------------------------------------------------------------------
consumer, services and health care. As a testament to our focused stock picking,
each one of these portfolio sectors outperformed the Russell 2000 during this
six-month reporting period.
The star of the show has been consumer stocks and we tip our hats to Judy
Finger, Kern Capital Management's consumer stock expert. Our strategy in the
consumer sector has been to focus on leisure and entertainment stocks like
restaurants, cruise lines and hotels, rather than on traditional consumer "hard
goods." Our rationale was that consumers had already bought new wardrobes, cars,
homes, computers, etc. With consumer confidence still high and mortgage
refinancing putting more money in their pockets, we believed consumers were now
poised to spend more money to enjoy themselves by eating out more often and
vacationing. Although our consumer stocks have done quite well in most cases, we
still see excellent upside potential.
In the technology sector, we did extremely well with internet security
stocks. As businesses open their networks to customers, they become more
vulnerable to security breeches. We were able to buy stocks like Checkpoint
Software ("firewall" software) and Network Associates (anti-virus, network
security, and intrusion detection software) very near their bottoms. When
valuations became rather rich, we liquidated these positions. The strong
technology stock rally off late 1997 lows has made us increasingly selective in
our stock picking efforts. We are especially wary of the sizzling
consumer-oriented internet stocks that in our opinion are now trading at
particularly expensive prices. But, with 26% of the portfolio in technology, we
are still finding opportunities. Telecommunications is one of the technology
areas where we still see some outstanding values. Consumers and businesses are
clamoring for faster data transmission--speeding up the internet--and we have
found a number of small and largely unrecognized companies that have some very
promising new technologies in this arena.
In recognition of all the good work she's been doing, we have chosen one of
Judy Finger's favorite consumer stocks to demonstrate our investment discipline.
Please note, we reserve the right to change our opinion on this stock should
fundamental circumstances change. American Classic Voyages is a little $350
million market cap company. Presently, most of American Classic's revenues and
earnings come from their fleet of paddlewheel riverboats operating in the
Mississippi. This is a nice little business, but not the primary reason we like
the stock. American Classic also has a few older ocean cruisers operating in the
restricted and under-exploited Hawaiian market. We believe the company is very
close to announcing a joint venture with one of the big three American cruise
lines and Hyatt Hotels. American Classic will contribute its cruising rights in
Hawaiian waters. It's partner will bring in several modern ships and Hyatt will
help with the marketing.
We think this will be a win/win for everyone involved, but a big bonanza
for little American Classic. Nobody really follows the stock, but one of its
largest shareholders is the legendary Sam Zell, a proven moneymaker. American
Classic's senior management has been motivated with stock options and we believe
is committed to getting this deal done. If it happens, this little company is
going to get some attention on Wall Street. Presently, this is an "event" stock,
not an earnings story. However, assuming this or another joint venture to fully
develop the Hawaiian cruise market goes through, American Classic can make some
real money.
In closing, we are gratified to have materially outperformed our benchmark
index during this, our first full six-month reporting period. While we still
expect to see significant market volatility, we believe our dedicated research
effort and focused stock picking discipline can continue to generate superior
returns in the small cap equity market.
Sincerely,
/S/ David G. Kern
David G. Kern
Portfolio Manager
Fremont U.S. Small Cap Fund
17
<PAGE>
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FREMONT FUNDS
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FREMONT SELECT FUND
John B. Kosecoff, Debra L. McNeill & Pete Landini, Portfolio Managers
Fremont Investment Advisors, Inc.
[PHOTO]
John B. Kosecoff
- ------------
FUND PROFILE
- ------------
The Fremont Select Fund seeks long-term capital appreciation by investing
primarily in stocks of established medium-sized growth companies. Under normal
market conditions, the Fund expects to hold no more than 30 stocks representing
at least 80% of its total assets.
Great growth companies trading at opportunistic prices are rare finds.
Through intensive fundamental research and disciplined stock picking, Fremont
Select Fund managers strive to build and maintain a concentrated portfolio of
these investment gems. Due to its stock-specific, concentrated portfolio
approach, the Fund's day-to-day volatility may exceed the market averages.
However, fund management believes that selective investment in sound growth
companies will reward investors with superior long-term returns.
To Our Shareholders,
From inception on December 31, 1997, through April 30, 1998, the Fremont
Select Fund returned 3.73% compared to gains of 15.10% and 11.08% for the
Standard & Poor's 500, and its benchmark, the Russell Mid-Cap Index,
respectively.
We are disappointed with the Fund's performance in its first four months of
existence. Our cautious approach in transitioning the portfolio from cash into
equities restrained returns in the rapidly rising market. Our oil services
holdings performed poorly as investors abandoned the group in response to
declining oil prices. We think investors will return in force once they
recognize that even with lower oil prices, deep-water drilling activity will
remain strong as will the earnings of quality oil services companies.
In this, our first letter to shareholders, we will go into some detail on
how we approach the research and stock selection process. We sink our teeth into
income statements and balance sheets--paying particular attention to those often
very revealing financial footnotes. Then we hit the road--meeting with corporate
managements, inspecting their operations, reviewing their financial controls,
and assessing their business plans. Since we always look for several
perspectives, we also talk to their distributors, customers and the competition.
Ultimately, we make invest-
- --------------------------------------------------------------------------------
Fremont Select Fund Investment Returns
Returns
12/31/97-4/30/98* +3.73%
Growth Of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since December 31, 1997 of a $10,000
investment in the Fremont Select Fund and the Russell Mid-Cap Index.
4/30/98
-------
Fremont Select Fund $10,373
Russell Mid-Cap Index $11,108
Return for Period Ended 4/30/98
Since Inception
12/31/97
--------
3.73%*
* Unannualized
+ Assumes initial investment of $10,000 on inception date, December 31, 1997.
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 Mid-Cap Index.
18
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FREMONT FUNDS
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ment decisions based solely on our independent analysis of a company's
fundamentals and our independent judgment on the ability of management to grow
the value of their businesses in a way that rewards shareholders.
We are growth stock investors. We want to own businesses that generate
profits that comfortably exceed cost of capital. So, we focus on return on
assets (ROA). We favor companies with ROAs in the 10%-25% range. If ROA is at
the high end of this range, we want to see evidence that the business is not
being milked as a cash cow and that management is making the necessary
investments in infrastructure and/or research and development to position the
company for long-term growth.
Valuation is also important. But, we are not "value" managers. Traditional
value investors tend to focus on measures of affordability--dividend yield,
price/book value ratios and price/earnings multiples. We focus first on the
quality of the business, second on its growth prospects, and finally, on whether
it is trading in a valuation range that offers superior risk-adjusted long-term
return potential. In our opinion, one of the best ways to assess this is the
ratio of a stock's price/earnings multiple to its projected 3-year annual
earnings growth rate. The mathematical formula is: (price/earnings)/projected
3-year earnings per share growth rate. In our short hand it's PEGR.
Not every stock in the Fremont Select Fund has a P/E below its projected
earnings growth rate. However, the portfolio as a whole has a PEGR of 67%. This
compares to a PEGR of 113% for 30 Morningstar top-rated mid-cap growth funds
studied in a recent survey conducted by Morningstar, a mutual fund rating
organization. Moreover, the average projected earnings growth rate for the
Select Fund's holdings was better than 20% higher than the Morningstar group
average. We believe the combination of growth investing with valuation
discipline allows shareholders to "have their cake and eat it too."
Here is an example of how we put theory into practice. Keep in mind that
this is not a recommendation. Our opinion on this stock may change in this
dynamic market. EVI, Inc. (formerly Energy Ventures, Inc.) is a leading
manufacturer of oil field drilling tools and premium tubular products. Pre-tax
returns on assets exceed 11% and are rising. In addition, management is growing
assets per share at better than 18% compounded and the company is conservatively
financed with debt just 27% of capital. We look for per share earnings to grow
at better than 20% compounded over the next three years, driven by secular
demand in the Americas for EVI's products as well as its recent acquisition of
Weatherford, a well-established company that compliments EVI geographically with
its well services business.
At its current price, EVI trades at slightly greater than 12 times its
projected 1999 earnings per share of $4.25, or about a 40% discount to the S&P
500's multiple of 20 times projected 1999 earnings. Just last month we met with
EVI's senior management and visited a deep-water oil rig in the Gulf of Mexico
that uses EVI products. We know what we like about the company today and equally
importantly, we know what to look for in monitoring our investment going
forward.
In closing, a few brief comments on relative performance are in order. Our
approach may periodically be out of step with the kind of momentum driven market
we have experienced in 1998. The kind of mid-cap growth stocks we favor are not
generally in the investment mainstream and therefore, are not likely to get
swept up during periods of investor euphoria. On the other hand, they are not
likely to get swept away when investor psychology turns negative. However, if
our assessments of growth prospects and appropriate valuations are accurate,
they are the kind of stocks that can deliver superior long-term investment
performance.
We thank you for giving us the opportunity to manage a portion of your
assets. Be assured we will be working hard each and every day to deliver the
kind of returns that justify your confidence in our investment abilities.
Sincerely,
/S/ John B. Kosecoff /S/ Debra McNeill
/S/ Pete Landini
John B. Kosecoff, Debra McNeill & Pete Landini
Portfolio Managers
Fremont Select Fund
19
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FREMONT FUNDS
- --------------------------------------------------------------------------------
FREMONT GROWTH FUND
W. Kent Copa, CFA, Portfolio Manager
Fremont Investment Advisors, Inc.
[PHOTO]
Ken Copa
- ------------
FUND PROFILE
- ------------
Fremont Growth Fund invests principally in large capitalization U.S. stocks
with superior earnings growth prospects. The goal is to outperform the Standard
& Poor's 500 Index.
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, household products, 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 potential. The stock selection process focuses on leading companies in
each industry group with consistent earnings growth records and reasonable
valuations.
To Our Shareholders,
For the six-month period ended April 30, 1998, the Fremont Growth Fund
returned 17.29% compared to its benchmark, the Standard & Poor's 500 Index's
22.49% and the Lipper Growth Fund Average's 17.26% gains.
The Fund's overweighting in financial services buoyed returns, with
continued takeover activity in the sector helping to drive prices higher. The
merger of Citicorp and Travelers Group--one of our largest portfolio
holdings--was particularly beneficial. Going forward, we believe we will
continue to see consolidation in the financial services industry. If aggressive
lobbying efforts to repeal or amend the Glass Steagel Act are successful, the
deal floodgate could open wide, with banks, insurance and securities firms
combining to offer one stop financial services shopping. Although the broad
utilities sector posted lackluster returns, our telecommunications holdings
performed quite well. As regulatory barriers here and overseas continue to fall,
strategic mergers and global joint venturing should continue to benefit
telecommunications stocks.
- --------------------------------------------------------------------------------
Fremont Growth Fund Investment Returns
Annual Returns
8/14/92-10/31/92* +2.00%
11/01/92-10/31/93 +12.80%
11/01/93-10/31/94 +1.72%
11/01/94-10/31/95 +28.12%
11/01/95-10/31/96 +22.06%
11/01/96-10/31/97 +29.26%
11/01/97- 4/30/98 +17.29%
Growth of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since August 14, 1992 of a $10,000 investment
in the Fremont Growth Fund and the S&P 500 Index.
4/30/98
-------
Fremont Growth Fund $27,749
S&P 500 Index $30,368
Average Annual Returns for Periods Ended 4/30/98
Since Inception
1 Year 5 Years 8/14/92
------ ------- -------
36.42% 19.96% 19.58%
* 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.
20
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FREMONT FUNDS
- --------------------------------------------------------------------------------
Fremont Growth Fund
Sector Diversification as of April 30, 1998
[GRAPHIC OMITTED]
Short-Term Securities 1.8%
Other 27.5%
Consumer Services 4.9%
Health Care 5.6%
Financial Services (Other) 9.6%
Energy 15.0%
Financial Services (Banks) 13.9%
Utilities 12.0%
Technology 9.7%
- --------------------------------------------------------------------------------
Our overweighting in energy stocks restrained returns. El Nino's warm
winter, a draw-down of energy inventories in Southeast Asia, and increased
production from OPEC combined to drop oil prices to a five-year low.
Regarding the market, we share most prudent investors concern over high
equity valuations. However, the very favorable economic backdrop for stocks--low
inflation, low interest rates, and decent corporate earnings growth--remains
intact. We believe growing wage pressure in the tight U.S. labor market will be
offset by continued productivity gains and pricing restraints resulting from low
cost imports from Southeast Asia. We doubt the Federal Reserve will raise
short-term interest rates in the foreseeable future, and we may see long rates
test their lows in the year ahead. Our conclusion is that stocks will continue
to trend higher, albeit at a considerably less torrid pace than we have seen in
recent years.
In our letters to you, we give some detail on portfolio holdings that
demonstrate our investment discipline. Please be advised these are not
recommendations and we may change our opinion on the securities mentioned if
circumstances warrant it. This time around, we've chosen a couple of our current
favorites from the financial services and energy groups. American General's
acquisition of U.S. Life in June 1997, temporarily restrained earnings. The
integration of the two companies is now complete. We estimate the combined
companies will realize about $50 million in cost savings in the year ahead. We
believe earnings can grow at about 12% annually over the next five years and
drive the stock higher, making American General an attractive target if banks
are allowed to own insurers in the future.
Atlantic Richfield suffered along with the other major integrated oil
companies as oil prices plummeted. As mentioned before, we believe oil prices
will recover in the year ahead. Arco is getting new production from Alaska and
has recently signed a joint venture to help develop a promising oil field in
Peru. In addition, its 82% owned subsidiary, Arco Chemical, is doing extremely
well. We believe Atlantic Richfield can grow earnings around 9% annually over
the next five years even if oil stays at relatively depressed price levels. If
oil prices really bounce, we would revise our earnings estimates upward.
In closing, we still favor value sectors like financial services, utilities
and energy over higher multiple groups like consumer non-durables. We are still
working hard to identity those industry groups and individual stocks with the
brightest prospects.
Sincerely,
/S/ W. Kent Copa
W. Kent Copa
Portfolio Manager
Fremont Growth Fund
21
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FREMONT FUNDS
- --------------------------------------------------------------------------------
FREMONT REAL ESTATE SECURITIES FUND
John Kramer & Paul Gray, Portfolio Managers
Kensington Investment Management
[PHOTO]
John Kramer
- ------------
FUND PROFILE
- ------------
The commercial real estate industry is in the early stages of a major
transformation. Privately held real estate empires are being replaced by
financially strong, well-managed, publicly traded companies, that buy, sell and
manage commercial property throughout the U.S. In the process, stock market
investors are being given an unprecedented opportunity to participate in an
industry that has generated enormous wealth.
Portfolio Co-Managers John Kramer and Paul Gray monitor macro-economic
trends, supply/demand dynamics and industry fundamentals in allocating assets to
real estate securities (primarily Real Estate Investment Trusts or REITs) in
different commercial sectors including office, apartment, retail, hotel and
industrial. Individual securities selection is based on the analysis of
corporate managements' acquisition, development and operating records; earnings
and dividend growth potential; and valuation relative to other publicly traded
real estate companies.
To Our Shareholders,
From inception on December 31, 1997, through April 30, 1998, the Fremont
Real Estate Securities Fund declined 0.60%, compared to the 3.74% decline for
its benchmark, the National Association of Real Estate Investments Trusts
(NAREIT) Composite Index. Of course, four months of performance for the Fund and
the real estate securities group is not particularly meaningful. Over the longer
term, we expect much more from this dynamic market sector and hope we can
continue to perform well relative to our benchmark index.
At this stage, rather than dissecting performance, we thought it more
appropriate to talk about the dramatic changes occurring in the commercial real
estate industry and to describe our approach to the real estate securities
market.
Traditionally, commercial real estate investing has been the province of
wealthy individuals and large financial institutions (primarily insurance
companies) that had ready access to capital in this capital intensive business.
These private and institutional real
- --------------------------------------------------------------------------------
Fremont Real Estate Securities Fund Investment Returns
Returns
12/31/97-4/30/98* -0.60%
Growth Of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since December 31, 1997 of a $10,000
investment in the Fremont Real Estate Securities Fund and the NAREIT Composite
Index.
4/30/98
-------
Fremont Real Estate Securities Fund $ 9,940
NAREIT Composite Index $ 9,626
Return for Period Ended 4/30/98
Since Inception
12/31/97
--------
-0.60%*
* Unannualized
+ Assumes initial investment of $10,000 on inception date, December 31, 1997.
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
NAREIT Composite Index.
22
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FREMONT FUNDS
- --------------------------------------------------------------------------------
estate empires are gradually giving way to publicly traded companies formed
exclusively to buy, own and operate commercial real estate. Publicly owned real
estate companies have distinct advantages; the single biggest being low cost of
capital (raising money in the equities markets is generally significantly less
expensive than borrowing from the bank). Publicly held real estate companies
also benefit from tax advantages, operating efficiencies and in the case of
sectors like hotels and health care facilities, marketing synergies. We believe
we are still in the relatively early stages of what we refer to as the
securitization of the real estate industry. This is a trend that is likely to
gain momentum for the next 10-15 years.
What does the transformation of this industry mean for investors? For the
average investor, it presents the first opportunity to invest in commercial real
estate; an asset that has generated enormous wealth in the U.S. For somewhat
wealthier investors it offers diversification--you no longer have to bet the
ranch on one or two properties. All real estate securities investors generally
get yields well above most equity sectors and the potential for capital
appreciation as real estate companies grow earnings and asset values.
We think the securitization of the industry will have a significant impact
on the real estate market itself. As more and more commercial real estate assets
fall into the hands of long-term equities investors and under the management of
experienced buyers/owners/operators, we believe the real estate market will be
considerably less cyclical.
The Fremont Real Estate Securities Fund is somewhat different than many
others in that we intend to have a significant portion of the portfolio in
smaller cap real estate securities. This will allow us to take full advantage of
our hands-on research capabilities. In order to continue to make meaningful
investments in smaller real estate companies, we will cap the fund off and not
allow new investors if it gets larger than at 0.3% of the total value of the
real estate investment trust (REIT) market. Today, this would occur if the fund
assets were $450 million.
We combine a quantitative and qualitative approach to identify
opportunities. We pour over income statements, focusing on operating margins and
funds from operations (FFO), the financial keys to profitability. We review
prior acquisitions to determine how good a job management has done in buying
properties. We meet with managements to discuss their growth strategies and make
a qualitative judgment of their abilities to successfully execute them. In
selecting individual real estate securities, we are looking for financial
stability and above average yields and/or growth prospects. We are also looking
for value relative to similar companies and the industry at large.
Diversification by industry sector and geographic region will be maintained to
moderate risk.
Perhaps the best way to demonstrate our approach is to discuss a current
portfolio holding. Please understand this is not a recommendation. We reserve
the right to change our opinion on this and all other individual securities in
the portfolio. Malan is a small REIT ($67 million market cap) specializing in
small to medium-sized shopping centers in the Midwest. In the mid '90s, the
company's performance was restrained when K-mart, the anchor retailer in a high
percentage of their properties, ran into trouble. In the last several years,
Malan has replaced K-mart in many of its properties, and better operating
performance is allowing the company to raise more money through its first
secondary offering. We think Malan is now back on the growth path. The stock
yields 9.6% and is currently trading around 10 times FFO compared to an industry
average multiple of around 12.5.
In closing, once again we thank you for your support and pledge our best
efforts to meeting our shared investment objectives.
Sincerely,
/S/ John Kramer /S/ Paul Gray
John Kramer & Paul Gray
Portfolio Managers
Fremont Real Estate Securities Fund
23
<PAGE>
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FREMONT FUNDS
- --------------------------------------------------------------------------------
FREMONT BOND FUND
Bill Gross, Founder and Managing Director
Pacific Investment Management Company (PIMCO)
[PHOTO]
Bill Gross
- ------------
FUND PROFILE
- ------------
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.
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 $118 billion in fixed income investments for
institutional clients.
To Our Shareholders
Over the past six months, we saw bonds rise in price as interest rates
continued on their downward trend. The yield on the 30-Year U.S. Treasury Bond
declined from 6.14% at the end of October to 5.95% as of April 30. Inflation
data confirmed that, despite the strength in the U.S. economy, pricing power
remained weak. The crisis in Southeast Asia provided further fuel as investors
sought a safe haven in U.S. Treasuries. The Fremont Bond Fund returned 3.24% for
the period which was in-line with the domestic bond market as a whole.
Our strategies in the Fund have been fairly consistent over the past six
months as we have maintained
- --------------------------------------------------------------------------------
Fremont Bond Fund Investment Returns
Annual Returns
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%
11/01/96-10/31/97 +9.54%
11/01/97- 4/30/98* +3.24%
Growth of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since April 30, 1993 of a $10,000 investment
in the Fremont Bond Fund and the Lehman Bros. Aggregate Bond Index.
4/30/98
-------
Fremont Bond Fund $14,322
Lehman Bros. Aggregate Bond Index $13,965
Average Annual Returns for Periods Ended 4/30/98
Since Inception
1 Year 3 Years 4/30/93
------ ------- -------
10.59% 9.79% 7.45%
* Anannualized
+ 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.
24
<PAGE>
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FREMONT FUNDS
- --------------------------------------------------------------------------------
a slightly longer average maturity relative to the market, an emphasis on
mortgage backed securities and a small allocation to emerging market debt. The
success of these strategies was mixed. Our decisions to carry a longer maturity
and emphasize mortgages were both positive. But, our 2% allocation to Latin
American debt offset the benefits of these strategies. The Latin American
positions underperformed quite a bit in the fourth quarter as the region
suffered from contagion effects associated with Southeast Asia. While these
positions did quite well in early 1998 as stability returned to Latin America,
it wasn't enough to fully offset the fourth quarter of 1997.
Looking ahead, we see steady growth and low inflation in the U.S. Consumers
will drive U.S. economic growth at a steady pace over the next six to nine
months. But that strength will be tempered by reduced demand in Asian economies,
both developed and emerging. Inflation will remain subdued, as U.S.
manufacturing and service industries continue to lack pricing power. The
expansion of global competition and deregulated markets should also help contain
prices in the foreseeable future. In this environment, we expect long-term rates
to move lower and we will maintain longer average maturity to take advantage of
the associated price gains. Mortgages will be the most prudent way to add yield
to portfolios without adding undue risk, so we will continue to emphasize this
sector. While we approach the debt of emerging economies with caution, some
markets are still a source of value. We like Latin America, particularly
Argentina and Brazil, and will retain a 2-3% exposure to the region.
We certainly appreciate your interest and investment in the Fremont Bond
Fund. We will continue to do our best to bring you solid performance results.
Sincerely,
/S/ Bill Gross
Bill Gross
Portfolio Manager
Fremont Bond Fund
Portfolio Credit Quality of Fremont Bond Fund as of April 30, 1998
[GRAPHIC OMITTED]
A 28%
AAA 52%
BB 8%
BBB 12%
25
<PAGE>
- --------------------------------------------------------------------------------
FREMONT FUNDS
- --------------------------------------------------------------------------------
FREMONT MONEY MARKET FUND
Norman Gee, Portfolio Manager
Fremont Investment Advisors, Inc.
[PHOTO]
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 months ended April 30, 1998, the Fremont Money Market Fund
returned 2.69% compared to the IBC Money Market First Tier Taxable Average's
2.49%. The Fremont Money Market Fund once again finished in the top ten percent
of comparable funds in the IBC money market fund universe.
With the Federal Reserve sitting on its collective hands since March 1997,
short-term interest rates haven't budged much. I had been concerned that wage
pressure in the tight U.S. labor market might prompt the Fed to bump up rates
toward the end of first quarter 1998. However, wage pressure has been offset by
deflation in materials and raw goods prices and continued pricing restraint on
behalf of U.S. companies, at least partially in response to low-cost imports
from Southeast Asia. I think Asia will recover more quickly than most people
seem to anticipate. I am seeing companies in the U.S. and other developed
nations start to invest rather aggressively in dirt cheap manufacturing capacity
in Southeast Asia. This foreshadows a recovery, but not one that is likely to
have any inflationary impact on global economies.
Also, as the government tinkers with the Consumer Price Index (CPI)to
better reflect changes in consumers' buying habits--when beef prices rise,
people buy more chicken--we will probably see
- --------------------------------------------------------------------------------
Fremont Money Market Fund Investment Returns
Annual Returns
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%
11/01/94-10/31/95 +5.84%
11/01/95-10/31/96 +5.34%
11/01/96-10/31/97 +5.39%
11/01/97- 4/30/98* +2.69%
Growth of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since November 18, 1988 of a $10,000
investment in the Fremont Money Market Fund, the U.S. 90-Day T-Bill Index and
the IBC First Tier Taxable Average.
4/30/98
-------
Fremont Money Market Fund $16,596
U.S. 90-Day T-Bill Index $16,627
IBC First Tier Taxable Average $16,047
Average Annual Returns for Periods Ended 4/30/98
Since Inception
1 Year 5 Years 11/18/88
------ ------- --------
5.48% 4.81% 5.51%
* 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. 90-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.
26
<PAGE>
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FREMONT FUNDS
- --------------------------------------------------------------------------------
inflation as measured by the CPI come down. Some people think this may inspire
the Fed to drop short rates. I think the Fed will remain cautious and not do
anything for the balance of the year.
I've kept the Fund's average maturity between 60 and 70 days--extending
when the market pulls back and shortening when it heats up. The portfolio
remains barbelled, (heavier weightings on the long and short side of the
maturity spectrum), but average maturity has remained above the 55-day average
for the money market universe. This has continued to work to our advantage.
With yield spreads tightening in the highest rated money market securities,
it has become increasingly difficult to find special situations offering sizable
yield advantages. Some of the more aggressive money funds have, in my opinion,
been stretching credit quality parameters by focusing on securities that get the
highest ratings from two of the less widely accepted of the five nationally
recognized rating services. I'm not comfortable doing that. So, I continue to
buy only securities with the highest credit quality ratings from Standard &
Poor's and Moody's.
I am finding a few situations in which we are getting a 1 to 2 basis point
yield advantage (0.01%-0.02%). One recent example is the 3-month paper issued by
the Norwegian Export Financing Authority, which in essence serves as an
import/export bank for Norwegian companies. This is dollar-denominated paper
issued by a U.S.-domiciled corporation. We got a 1-basis-point yield premium
over comparable three-month paper. That's not much, but I've always operated
under the principle that every little bit helps.
In closing, I am pleased the Fund continues to outperform its benchmark and
remains near the top of its money market fund peer group. I look forward to
building on this superior performance track record.
Sincerely,
/S/ Norman Gee
Norman Gee
Portfolio Manager
Fremont Money Market Fund
27
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FREMONT FUNDS
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FREMONT CALIFORNIA INTERMEDIATE TAX-FREE FUND
William M. Feeney, Portfolio Manager
Fremont Investment Advisors, Inc.
[PHOTO]
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 manager'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, 1998, the Fremont California
Intermediate Tax-Free Fund returned 2.15% compared to the Lehman Brothers
Municipal 5-Year State General Obligation (GO) Index's 1.85%.
Through most of first half fiscal 1998, the portfolio's nine-year average
maturity, (compared to approximately 7 years for our benchmark index), worked in
our favor. In late April, when bond investors began questioning whether Asian
economic weakness would help quiet the U.S. economy and the Federal Reserve
began talking about a potential
- --------------------------------------------------------------------------------
Fremont California Intermediate Tax-free Fund Investment Returns
Annual Returns
11/16/90-10/31/91* +9.36%
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%
11/01/96-10/31/97 +6.75%
11/01/97- 4/30/98* +2.15%
Growth of $10,000+
[GRAPHIC OMITTED]
Comparison of the change in value since November 16, 1990 of a $10,000
investment in the Fremont California Intermediate Tax-Free Fund and the Lehman
Bros. 5-Year State G.O. Index.
4/30/98
-------
Fremont California Intermediate Tax-Free Fund $16,160
Lehman Bros. 5-Year State G.O. Index $15,951
Average Annual Returns for Periods Ended 4/30/98
Since Inception
1 Year 5 Years 11/16/90
------ ------- --------
7.40% 5.38% 6.65%
* 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.
28
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FREMONT FUNDS
- --------------------------------------------------------------------------------
Portfolio Credit Quality of Fremont California
Intermediate Tax-free Fund as of April 30, 1998
[GRAPHIC OMITTED]
A 10.6%
AA 25.7%
AAA 63.7%
- --------------------------------------------------------------------------------
rate hike, bonds retreated and our longer than benchmark average maturity worked
against us.
Looking ahead, continued uncertainty over the Asian impact on domestic
economic growth and the Fed's saber rattling may cause bonds to give up a little
more ground, with the 30-year Treasury Bond yield perhaps rising as high as
6.25%. However, this retreat should be short-lived. We believe the economy will
decelerate in second half 1998, easing inflationary worries. Also, in our
opinion, the Federal Reserve is more concerned about the inflation in financial
assets--the runaway stock market--than economic inflation, of which there is
still little or no evidence. If the Fed manages to slow the speeding stock
market, interest rates should resume their downward trend and bonds should
perform well. Since we focus on the longer term trend for bonds, we are going to
fight the temptation to significantly shorten the portfolio's average maturity.
Due to a big spike in supply--when interest rates came down in late 1997,
municipalities began issuing a lot of paper--munis have underperformed
Treasuries over the last six months. Since municipal bond issuers tend to
complete their financings early in the year, issuance generally trends down in
the summer. There is also a seasonal phenomena in the marketplace. Municipal
bond and municipal bond fund purchases generally rise after everyone calculates
their tax bills on April 15. So, we expect a better supply/demand balance in the
municipal market this summer to improve performance relative to Treasury
securities.
On the special situation front, we have recently been adding to our
municipal utilities holdings. In 1997, some of these bonds were downgraded on
fears that with deregulation, investor-owned utilities would begin picking off
municipal utilities big corporate customers. There has been a lot of noise, but
not much action. Here in San Francisco, we are being bombarded with
advertisements from investor-owned utilities throughout the northwest. However,
there is little indication that companies or consumers are anxious to switch
from utilities that have traditionally served them to newcomers from in or out
of state. Call it the "devil you know" syndrome. Also, municipal utilities have
done a pretty good job preparing themselves for competition by cutting a lot of
fat out of bloated operating budgets. Many now have the pricing flexibility to
protect their turf from aggressive competitors. We think the rating agencies and
investors will realize this and that prices for bonds issued by municipal
utilities like Los Angeles Power and Light will trend higher.
In closing, we are pleased to have once again exceeded our benchmark index.
We believe the recent weakness in the bond market will prove to be a hiccup
rather than a change in what we still see as a favorable long-term performance
trend. In coming months, more balanced supply and demand in the municipal bond
market should result in better performance relative to Treasuries.
Sincerely,
/S/ William M. Feeney
William M. Feeney
Portfolio Manager
Fremont California Intermediate Tax-Free Fund
29
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30
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FREMONT GLOBAL FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
STOCKS 64.5%
BUSINESS EQUIPMENT & SERVICES 3.9%
1,050 Flughafen Wien AG AS $ 46,577
600 Mayr-Melnhof Karton AG AS 41,614
650 VA Technologie AG AS 93,368
8,600 Bombardier, Inc. (Class B) CN 232,002
2,300 Magna International, Inc. (Class A) CN 171,594
6,500 Moore Corp. Ltd. CN 101,531
6,400 Northern Telecom Ltd. CN 389,363
1,100 FLS Industries A/S (Class B) DK 29,224
662 ISS International Service System A/S
(Class B) DK 35,755
250 Kone Corp. (Class B) FI 37,855
12,444 Sodexho Alliance SA FR 2,276,833
250 Linde AG GM 169,822
4,450 RWE AG (Preferred) GM 186,945
2,027 Getronics NV NL 89,626
2,577 NV Koninklijke KNP BT NL 70,737
551 Oce NV NL 83,117
608 Kvaerner ASA NO 26,957
600,000 Informatics Holdings Ltd. SG 234,923
11,000 Telefonica de Espana SA SP 458,739
3,500 Atlas Copco AB (Class A) SW 103,216
* 2,200 Securitas AB (Class B) SW 80,921
379 Adecco SA SZ 165,276
93,000 BG PLC UK 495,403
26,000 BOC Group PLC UK 446,156
29,300 Granada Group PLC UK 504,254
40,907 Reuters Group PLC UK 444,022
177,000 American Business Information, Inc. (Class B) US 2,522,250
* 66,000 Aspect Telecommunications Corp. US 1,897,500
92,900 Diebold, Inc. US 3,808,900
40,900 Equifax, Inc. US 1,582,319
* 31,700 FDX Corp. US 2,155,600
59,700 First Data Corp. US 2,022,338
34,100 G & K Services, Inc. (Class A) US 1,372,525
* 71,000 Harbinger Corp. US 2,582,625
96,100 Waste Management, Inc. US 3,219,350
------------
28,179,237
------------
CAPITAL GOODS 1.5%
600 Boehler - Uddeholm AG AS 44,209
700 Radex-Heraklith Industriebeteiligungs AG AS 35,345
400 Wienerberger Baustoffindustrie AG AS 89,589
1,000 Metra Oyj (Class B) FI 25,145
1,650 Heidelberger Zement AG GM 142,400
750 Mannesmann AG GM 590,479
11,050 Siemens AG GM 650,018
7,706,000 PT Dynaplast ID 570,815
50,000 Larsen & Toubro Ltd., GDR IN 648,750
* 60,000 Cemex SA (Class B), ADR MX 712,404
370,000 IJM Corp. Berhad MY 177,441
992 Aker RGI ASA NO 17,407
100 Zardoya Otis SA SP 3,836
16,000 ABB AB (Series A) SW 259,154
7,800 ABB AB (Series B) SW 120,801
225 ABB AG SZ 368,509
191 Holderbank Financiere Glarus AG (Class B) SZ 201,936
95,400 General Electric PLC UK 779,832
40,200 Caterpillar, Inc. US 2,288,888
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
CAPITAL GOODS (CONT.)
49,300 Emerson Electric Co. US $ 3,136,713
16 Raytheon Co., (Class A) US 883
------------
10,864,554
------------
CONSUMER DURABLES 2.3%
322 Bang & Olufsen Holding AS (Class B) DK 21,387
* 10,050 Daimler-Benz AG GM 983,177
550 Volkswagen AG GM 438,377
15,647 CRH PLC IR 223,259
33,000 Murata Manufacturing Co. Ltd. JP 963,322
17,000 Sony Corp., ADR JP 1,443,938
7,454 Philips Electronics NV NL 656,220
27,000 Autoliv, Inc. SW 801,563
1,700 Electrolux AB SW 157,970
3,500 Volvo AB (Class A) SW 100,280
6,900 Volvo AB (Class B) SW 201,257
34,300 Scottish & Newcastle PLC UK 514,006
40,500 Chrysler Corp. US 1,627,594
36,000 Ford Motor Co. US 1,649,250
44,800 General Motors Corp. US 3,018,400
44,600 Whirlpool Corp. US 3,211,200
------------
16,011,200
------------
CONSUMER NON-DURABLES 2.9%
7,400 Abitibi-Consolidated, Inc. CN 109,900
1,700 George Weston Ltd. CN 172,275
6,533 Imasco Ltd. CN 245,869
9,100 The Seagram Co. Ltd. CN 387,951
866 Carlsberg AS (Class A) DK 53,726
746 Carlsberg AS (Class B) DK 46,391
1,374 Danisco AS DK 86,245
500 Cultor Oyj FI 29,550
440 LVMH, ADR FR 18,040
20,000 Societe BIC SA FR 1,375,322
1,000 Adidas-Saloman AG GM 165,367
8,400 Deutsche Lufthansa AG GM 196,203
9,882 Greencore Group PLC IR 60,310
7,023 Kerry Group PLC IR 110,849
1,164 Heineken NV NL 269,771
13,397 Unilever NV NL 952,811
591 Orkla ASA (Class A) NO 69,981
189 Orkla ASA (Class B) NO 20,203
900 Tabacalera SA SP 19,357
5,500 Svenska Cellulosa AB (Class B) SW 158,293
762 Nestle SA (Registered Shares) SZ 1,476,312
* 70,777 President Enterprises, GDR TW 743,163
78,000 B.A.T. Industries PLC UK 744,898
30,000 Cadbury Schweppes PLC UK 439,031
76,378 Diageo PLC UK 912,713
* 12,022 Diageo PLC (Class B) UK 143,663
70,300 Unilever PLC UK 751,903
62,100 American Greetings Corp. (Class A) US 2,872,125
19,300 Campbell Soup Co. US 990,331
30,300 Fort James Corp. US 1,503,638
* 53,700 Owens-Illinois, Inc. US 2,124,506
60,400 VF Corp. US 3,140,800
* 1,930 Vlasic Foods International, Inc. US 44,511
------------
20,436,008
------------
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
31
<PAGE>
FREMONT GLOBAL FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
CONSUMER SERVICES 2.8%
22,000 News Corp. Ltd., ADR AU $ 600,875
15,500 The Thompson Corp. CN 466,349
10,410 Independent Newspapers PLC IR 62,802
20,000 Secom Co. JP 1,173,682
265,000 Genting Berhad MY 880,375
15,043 Elsevier NV NL 226,921
* 1,551 Wolters Kluwer NV NL 202,591
* 2,912 Vard AS NO 14,003
4,300 Autopistas Concesionaria Espanola SA SP 69,362
48,300 British Sky Broadcasting Group PLC UK 353,824
50,100 Carlton Communications PLC UK 431,949
35,600 Reed International PLC UK 314,674
* 21,800 Clear Channel Communications, Inc. US 2,054,650
63,200 Disney (Walt) Co. US 7,856,550
* 47,500 Jacor Communications, Inc. US 2,701,563
44,600 The Times Mirror Co. (Class A) US 2,728,963
------------
20,139,133
------------
ENERGY 8.2%
1,100 OMV AG AS 163,144
535 Petrofina SA BE 210,823
5,300 Alberta Energy Co. Ltd. CN 127,236
4,410 Canadian Occidental Petroleum Ltd. CN 89,535
4,123 Imperial Oil Ltd. CN 227,351
3,021 IPL Energy, Inc. CN 133,014
12,200 NOVA Corp. CN 137,275
7,900 Petro-Canada CN 133,061
3,509 Suncor Energy, Inc. CN 120,903
* 3,500 Talisman Energy, Inc. CN 105,794
6,800 Transalta Corp. CN 111,682
6,200 TransCanada PipeLines Ltd. CN 137,792
45,850 Royal Dutch Petroleum Co. NL 2,528,451
3,376 Norsk Hydro ASA NO 168,223
* 458 Petroleum Geo-Services ASA NO 29,693
3,900 Repsol SA SP 213,534
121,100 British Petroleum PLC UK 1,912,988
23,900 Burmah Castrol PLC UK 494,863
84,000 Amoco Corp. US 3,717,000
24,400 Atlantic Richfield Co. US 1,903,200
58,600 Chevron Corp. US 4,845,488
44,800 Devon Energy Corp. US 1,786,400
68,500 Dresser Industries, Inc. US 3,621,938
74,500 ENSCO International, Inc. US 2,104,625
29,400 EVI, Inc. US 1,565,550
103,600 Exxon Corp. US 7,556,325
27,500 Kerr-McGee Corp. US 1,815,000
29,700 Mobil Corp. US 2,346,300
109,900 Occidental Petroleum Corp. US 3,235,181
21,500 Pennzoil Co. US 1,377,344
36,600 Phillips Petroleum Co. US 1,813,988
* 65,000 R&B Falcon Corp. US 2,084,063
41,600 Texaco, Inc. US 2,558,400
* 65,500 The Houston Exploration Co. US 1,531,063
16,800 Transocean Offshore, Inc. US 938,700
68,800 USX-Marathon Group US 2,463,900
147,000 Williams Cos., Inc. US 4,648,875
------------
58,958,702
------------
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
FINANCIAL SERVICES (BANKS) 9.0%
2,750 Bank Austria AG AS $ 212,417
1,300 Bank Austria AG (Preferred) AS 101,012
200,000 Westpac Banking Corp. Ltd. AU 1,338,073
373 Generale de Banque SA BE 215,192
299 Kredietbank NV BE 168,465
6,600 Bank of Montreal CN 359,786
12,400 Bank Of Nova Scotia CN 340,147
10,200 Canadian Imperial Bank of Commerce CN 362,491
7,400 Royal Bank of Canada CN 441,668
1,100 Den Danske Bank DK 133,276
1,151 Unidanmark AS (Class A) DK 96,610
17,750 Merita PLC (Class A) FI 118,910
5,050 Bayerische Hypotheken-und
Wechsel-Bank AG GM 283,992
6,050 Bayerische Vereinsbank AG GM 451,392
10,200 Deutsche Bank AG GM 790,557
9,600 Dresdner Bank AG GM 521,158
33,704 Allied Irish Banks PLC IR 463,410
* 75,000 Instituto Mobiliare Italiano SPA IT 1,227,773
29,907 ABN AMRO Holding NV NL 727,743
66,800 ABN AMRO Holding NV, ADR NL 1,707,575
50,288 ING Groep NV NL 3,265,648
5,700 Banco Comerical Portugues, SA PT 197,813
2,700 Banco Espirito Santo E Comercial
De Lisboa, SA PT 126,127
1,900 Banco Totta & Acores SA
(Registered Shares) PT 71,087
2,400 BPI-SGPS SA (Registered Shares) PT 110,027
3,100 Cimpor-Cimentos de Portugal, SGPS, SA PT 112,482
800 Companhia de Seguros Tranquilidade PT 27,768
217,478 Overseas-Chinese Banking Corp. Ltd.
(Foreign Registered) SG 1,146,791
214,899 United Overseas Bank Ltd.
(Foreign Registered) SG 1,017,836
7,800 Banco Bilbao Vizcaya, SA SP 400,984
4,400 Banco Central Hispanoamericano SP 146,277
5,600 Banco Santander SP 295,597
1,600 Corporacion Bancaria de Espana SA SP 133,242
12,500 Skandinaviska Enskilda Banken SW 208,110
4,700 Svenska Handelsbanken (Class A) SW 212,911
5,208 Credit Suisse Group SZ 1,144,234
1,483 Schweizerischer Bankverein SZ 514,409
423 Union Bank of Switzerland SZ 680,405
* 24,285 Thai Farmers Bank (Warrants 09/15/02)
(Foreign Registered) TH 5,418
34,000 Abbey National PLC UK 632,907
31,500 Barclays PLC UK 904,580
56,600 HSBC Holdings PLC
(United Kingdom Shares) UK 1,780,620
108,200 Lloyds TSB Group PLC UK 1,624,156
22,700 Royal Bank Of Scotland UK 356,498
45,700 Ahmanson (H.F.) & Co. US 3,484,625
62,700 Banc One Corp. US 3,687,544
60,600 BankAmerica Corp. US 5,151,000
36,000 Citicorp US 5,418,000
40,900 First Chicago NBD Corp. US 3,798,588
51,700 First Union Corp. US 3,121,388
34,400 Fleet Financial Group, Inc. US 2,971,300
59,600 NationsBank Corp. US 4,514,700
84,200 Norwest Corp. US 3,341,688
30,800 Republic New York Corp. US 4,119,500
------------
64,785,907
------------
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
32
<PAGE>
Fremont
Funds
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<PAGE>
FREMONT GLOBAL FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
FINANCIAL SERVICES (OTHER) 6.7%
300 EA-Generali AG AS $ 102,806
63,809 Lend Lease Corp. Ltd. AU 1,458,939
857 Fortis AG BE 241,718
343 Royale Belge BE 142,570
500 Pohjola Insurance Group (Class A) FI 27,347
1,500 Sampo Insurance Co. Ltd. (Class A) FI 67,726
39,000 Axa-UAP FR 4,575,654
4,400 Allianz AG GM 1,358,463
1,500 Muenchener Rueckversicherungs-
Gesellschaft AG GM 691,537
13,369 Irish Life PLC IR 123,982
15,000 Aiful Corp. JP 988,602
11,000 Nichiei Co. Ltd. (Kyoto) JP 852,424
8,638 Christiania Bank Og Kreditkasse NO 39,687
* 4,147 Storebrand ASA NO 36,662
44,000 Credicorp Ltd. PE 737,000
2,200 Skandia Forsakrings AB SW 153,040
285 Schweizerische Rueckversicherungs-
Gesellschaft (Swiss Registered) SZ 628,063
933 Zurich Versicherungs-Gesellschaft SZ 567,751
20,300 Commercial Union PLC UK 377,204
43,700 Prudential Corp. PLC UK 619,788
37,700 Royal & Sun Alliance Insurance Group PLCUK 419,304
49,700 Allstate Corp. US 4,783,625
67,900 American General Corp. US 4,523,838
14,600 Associates First Capital Corp. US 1,091,350
13,900 Cigna Corp. US 2,876,431
25,500 CMAC Investment Corp. US 1,646,344
84,400 Federal Home Loan Mortgage Corp. US 3,908,775
44,100 Fremont General Corp. US 2,458,575
61,700 Mercury General Corp. US 3,995,075
28,200 Morgan Stanley, Dean Witter and Co. US 2,224,275
81,150 Travelers Group, Inc. US 4,965,366
36,400 Travelers Property Casualty Corp. US 1,528,800
------------
48,212,721
------------
HEALTH CARE 4.3%
1,586 Nova Nordisk A/S (Class B) DK 256,985
2,500 Degussa AG GM 137,249
4,750 Merck KGaA GM 183,811
1,650 Schering AG GM 177,035
96,500 Grupo Casa Autrey SA de CV, ADR MX 1,278,625
1,599 Akzo Nobel NV NL 325,035
29,300 Astra AB (Class A) SW 601,254
7,700 Astra AB (Class B) SW 153,040
1,386 Novartis AG (Registered Shares) SZ 2,288,469
164 Roche Holding AG SZ 1,660,200
71,400 Glaxo Wellcome PLC UK 2,020,527
112,100 SmithKline Beecham PLC UK 1,343,346
20,000 Zeneca Group PLC UK 865,686
42,600 Baxter International, Inc. US 2,361,638
* 48,000 Biogen, Inc. US 2,130,000
145,300 Forest Laboratories, Inc. (Class A) US 5,258,044
* 141,100 Ligand Pharmaceuticals, Inc. US 2,045,950
32,000 Medtronic, Inc. US 1,684,000
* 46,600 Tenet Healthcare Corp. US 1,744,588
33,000 United Healthcare Corp. US 2,318,250
56,800 United States Surgical Corp. US 1,789,200
------------
30,622,932
------------
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
MULTI-INDUSTRY 1.0%
670 Groupe Bruxelles Lambert SA BE $ 133,638
400 Preussag AG GM 138,085
500 Viag AG GM 255,122
248,000 Renong Berhad
(Convertible Loan Stock 05/21/01) MY 20,930
* 155,000 Renong Berhad (Warrants Exp. 11/21/00) MY 12,458
300 Corporacion Financiera Alba SP 37,041
1,100 Fomento de Construcciones y Contratas SA SP 56,116
26,607 Bass PLC UK 511,755
133,700 BTR PLC UK 446,108
36,600 Allied-Signal, Inc. US 1,603,538
12,200 Minnesota Mining & Manufacturing Co. US 1,151,375
53,000 TRW, Inc. US 2,799,063
------------
7,165,229
------------
RAW MATERIALS 3.2%
2,135 Solvay SA BE 160,485
7,529 Alcan Aluminium Ltd. CN 244,153
9,500 Barrick Gold Corp. CN 212,793
7,000 Inco Ltd. CN 122,550
10,100 Noranda, Inc. CN 208,233
7,300 Placer Dome, Inc. CN 107,649
1,700 Potash Corp. of Saskatchewan CN 151,365
3,750 Kemira Oyj FI 40,608
3,000 Outokumpu Oyj FI 42,122
5,750 Upm-Kymmene Oyj FI 172,549
13,050 BASF AG GM 581,292
15,000 Bayer AG GM 668,151
800 Thyssen AG GM 183,074
43,757 Jefferson Smurfit Group PLC IR 162,686
* 581 Norske Skogindustrier ASA (Class A) NO 20,624
3,700 Portucel Industrial-Empresa
Produtora de Celulosa SA PT 33,965
1,400 Sonae Investimentos-Sociedade
Gestora de Participacoes Sociais SA PT 74,897
31,132 Hansol Paper Ltd., GDR SK 101,177
7,600 Stora Kopparbergs Bergslags
Aktiebolag (Class A) SW 129,964
* 147 Alusuisse-Lonza Holding AG SZ 187,909
25,100 Imperial Chemical Industries, Inc. UK 455,060
39,600 Rio Tinto PLC UK 568,924
44,600 Aluminum Co. of America US 3,456,500
99,800 Buckeye Technologies, Inc. US 2,320,350
26,900 Dow Chemical Co. US 2,600,894
129,900 Engelhard Corp. US 2,744,138
45,000 Goodrich (B.F.) Co. US 2,421,563
82,300 Pall Corp. US 1,615,138
56,600 Solutia, Inc. US 1,606,025
* 79,600 W.R. Grace & Co. US 1,616,875
------------
23,011,713
------------
RETAIL 2.9%
1,401 Delhaize - Le Lion SA BE 92,644
2,500 Kesko Oyj FI 40,378
4,000 Carrefour SA FR 2,289,988
4,900 Metro AG GM 242,817
31,430 Waterford Wedgwood PLC IR 52,475
200,000 Cifra SA de CV (Series C) MX 345,368
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
33
<PAGE>
FREMONT GLOBAL FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
RETAIL (CONT.)
50,599 Cifra SA de CV (Series V) MX $ 88,807
118,200 Grupo Elektra SA de CV, GDR MX 1,699,125
11,103 Koninklijke Ahold NV NL 345,956
2,200 Jeronimo Martins, SGPS, SA PT 101,432
4,500 Hennes & Mauritz AB (Class B) SW 234,051
24,600 Boots Co. PLC UK 378,109
48,900 J Sainsbury PLC UK 387,253
20,700 Kingfisher PLC UK 374,250
65,200 Marks & Spencer PLC UK 620,477
54,200 Tesco PLC UK 509,450
28,700 The Great Universal Stores PLC UK 438,007
97,000 Consolidated Stores Corp. US 3,880,000
51,900 McDonalds Corp. US 3,211,313
64,200 Sears, Roebuck and Co. US 3,807,863
40,300 Winn-Dixie Stores, Inc. US 1,516,288
------------
20,656,051
------------
SHELTER 1.4%
250,000 Sekisui House Ltd. JP 1,944,852
140,000 Kimberly-Clark de Mexico SA MX 681,901
2,900 Skanska AB (Class B) SW 135,114
19,900 Land Securities PLC UK 352,797
23,400 Armstrong World Industries, Inc. US 2,006,550
37,000 International Paper Co. US 1,930,938
25,200 Kimberly-Clark Corp. US 1,278,900
* 41,700 Triangle Pacific Corp. US 1,813,950
------------
10,145,002
------------
TECHNOLOGY 6.5%
343 Barco NV BE 90,726
* 2,200 Newbridge Networks Corp. CN 64,423
2,855 Tele Danmark A/S (Class B) DK 239,638
50,000 Nokia AB, ADR FI 3,343,750
6,000 SAP AG, ADR GM 996,496
50,000 Canon, Inc. JP 1,177,444
28,000 Tokyo Electron Ltd. JP 1,095,437
40,531 Samsung Electronics Ltd., GDS
(1 1/42 Non-Voting) SK 445,841
5,575 Samsung Electronics Ltd., GDS (1 1/42 Voting) SK 152,644
20,200 Telefonaktiebolaget LM Ericsson (Class B) SW 1,063,666
44,400 AMP, Inc. US 1,745,475
28,800 Avnet, Inc. US 1,776,600
63,100 Boeing Co. US 3,158,944
* 116,300 Hexcel Corp. US 3,249,131
62,200 International Business Machines Corp. US 7,207,425
53,400 Motorola, Inc. US 2,970,375
80,800 Parametric Technology Corp. US 2,583,075
14,700 Peoplesoft, Inc. US 683,550
* 29,600 Storage Technology Corp. US 2,499,350
35,000 Thiokol Corp. US 1,885,625
21,500 United Technologies Corp. US 2,116,406
18,500 Xerox Corp. US 2,099,750
* 135,200 Xilinx, Inc. US 6,185,400
------------
46,831,171
------------
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
TRANSPORTATION 0.5%
* 1,150 Austrian Airlines Osterreichische
Luftverkehrs AG AS $ 38,681
9,900 Canadian Pacific Ltd. CN 290,597
10,100 Laidlaw, Inc. CN 140,469
3 Dampskibsselskabet Svendborg AS DK 190,498
5 Dampskibsselskabet Svendborg af 1912 AS
(Class B) DK 224,073
1,122 SAS Danmark A/S DK 19,982
1,829 KLM Royal Dutch Airlines NV NL 71,825
1,125 Bergesen d.y. ASA (Class A) NO 24,262
30,100 Peninsular and Oriental Steam Navigation Co. UK 447,039
2,044 British Airways PLC UK 21,469
* 12,100 AMR Corp. US 1,843,738
------------
3,312,633
------------
UTILITIES 7.4%
1,250 Oesterreichische Elektrizitaetswirtschafts AG
(Class A) AS 152,299
1,112 Electrabel NPV BE 295,033
1,834 Tractebel BE 219,040
15,000 Enersis SA, ADR CL 441,563
15,000 BCE, Inc. CN 638,432
5,400 TELUS Corp. CN 145,487
15,000 Lyonnaise Des Eaux-Dumez FR 2,542,584
43,500 Deutsche Telekom GM 1,109,298
6,500 RWE AG GM 332,238
9,550 VEBA AG GM 629,045
520,000 Telecom Italia Mobile SPA IT 2,964,719
125 Nippon Telegraph & Telephone JP 1,090,923
10,368 Royal PTT Nederland NV NL 535,348
97,766 Manila Electric Co. (Class B) PH 276,903
14,900 Philippine Long Distance Telephone Co. PH 397,950
10,600 EDP-Electricidade de Portugal SA PT 271,190
5,800 Portugal Telecom SA PT 304,114
70,000 Korea Electric Power Corp., ADR SK 651,875
64,715 SK Telecom Co. Ltd., ADR SK 481,317
12,000 Endesa SA SP 291,138
1,800 Gas Natural SDG, SA SP 115,196
10,600 Iberdrola SA SP 170,290
900 Sociedade General de Aguas de Barcelona, SA SP 51,284
3,900 Union Electrica Fenosa, SA SP 50,379
134,100 British Telecommunications PLC UK 1,457,835
56,800 Cable & Wireless PLC UK 653,111
33,800 National Power PLC UK 328,725
28,000 United Utilities PLC UK 391,031
69,500 Vodafone Group PLC UK 765,432
* 51,200 AirTouch Communications, Inc. US 2,720,000
30,400 Ameritech Corp. US 1,293,900
80,800 AT&T Corp. US 4,853,050
78,900 BellSouth Corp. US 5,064,394
38,500 Coastal Corp. US 2,750,344
47,300 Consolidated Edison, Inc. US 2,140,325
100,300 Entergy Corp. US 2,494,963
113,900 PG&E Corp. US 3,687,513
59,600 Texas Utilities Co. US 2,384,000
99,700 Unicom Corp. US 3,464,575
* 98,700 WorldCom, Inc. US 4,222,492
------------
52,829,335
------------
TOTAL STOCKS (Cost $362,891,796) $462,161,528
------------
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
34
<PAGE>
FREMONT GLOBAL FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Value
Face Amount/Issuer/Coupon Rate/Stated Maturity (Note 1)
- --------------------------------------------------------------------------------
BONDS 30.4%
CORPORATE BONDS 7.0%
US$ 3,000,000 AES China Generating Co.,
10.125%, 12/15/06 $ 2,864,894
3,000,000 Applied Materials, 6.750%,
10/15/07 3,014,910
2,000,000 Asia Pulp & Paper International
Finance, 10.250%, 10/01/00 1,860,000
3,000,000 Bank of America, 6.625%, 10/15/07 3,043,440
3,000,000 Cemex SA de CV, 10.750%, 07/15/00 3,168,750
3,000,000 China Light and Power Co. Ltd.,
7.500%, 04/15/06 3,012,300
4,000,000 Export-Import Bank of Korea,
7.100%, 03/15/07 3,734,240
4,000,000 Ford Brasil LTDA, 9.250%, 01/22/07 3,957,500
2,500,000 General Electric Capital Corp.,
8.850%, 03/01/07 2,933,575
3,000,000 Grupo Televisa
(Callable 05/15/01 @106.625) 2,392,500
3,000,000 Guangdong Enterprises, 8.875%,
05/22/07 2,666,460
1,500,000 Korea Development Bank, 5.875%,
12/01/98 1,464,690
3,000,000 Lehman Brothers Holdings, Inc.,
7.375%, 05/15/07 3,159,540
3,000,000 Mass Transit Railway, 7.250%, 10/01/05 2,960,730
2,000,000 Perez Companc SA, 8.125%, 07/15/07 2,025,006
3,000,000 Salomon, Inc., 6.700%, 07/05/00 3,036,390
3,000,000 Sunamerica, Inc., 6.750%, 10/01/07 3,004,410
2,000,000 Wharf International Finance,
7.625%, 03/13/07 1,769,520
------------
50,068,855
------------
MORTGAGE-BACKED SECURITIES 0.1%
513,249 FNMA CMO, 1992-137BA REMIC,
3.500%, 01/25/17 507,475
------------
507,475
------------
U.S. GOVERNMENT BONDS 4.1%
5,000,000 FNMA, 5.750%, 02/15/08 4,910,950
5,000,000 FFCB, 6.300%, 12/03/13 5,064,050
U.S. Treasury Notes
5,000,000 6.000%, 02/15/26 4,983,600
5,000,000 6.250%, 08/15/23 5,139,050
5,000,000 6.500%, 10/15/06 5,239,050
4,000,000 6.625%, 05/15/07 4,241,240
------------
29,577,940
------------
FOREIGN BONDS 19.2%
Republic of Austria
ATS 40,000,000 5.625%, 07/15/07 3,279,649
Government of Australia
AUS$ 4,000,000 7.500%, 07/15/05 2,865,581
Morgan Guaranty Trust Co.
4,500,000 8.000%, 04/18/01 3,102,007
New South Wales Treasury Corp.
4,000,000 8.000%, 03/01/08 2,939,110
QTC-Global Notes
4,000,000 8.000%, 09/14/07 2,937,806
Value
Face Amount/Issuer/Coupon Rate/Stated Maturity (Note 1)
- --------------------------------------------------------------------------------
FOREIGN BONDS (CONT.)
Government of Canada
CAN$ 4,000,000 6.000%, 06/01/08 $ 2,927,742
4,000,000 8.000%, 06/01/23 3,656,568
Japan Highway Public Corp.
2,000,000 7.875%, 09/27/02 1,513,087
Oesterreichische Kontrollbank
(Republic of Austria)
2,000,000 9.000%, 06/19/02 1,567,250
Republic of Finland
2,000,000 9.500%, 09/15/04 1,672,957
Tokyo Electric Power
2,000,000 10.500%, 06/14/01 1,585,596
Caisse D'Amort Dette
DM 6,000,000 5.125%, 10/25/08 3,311,526
Deutschland Republic
6,000,000 5.625%, 01/04/28 3,344,098
Federal Republic of Germany
3,000,000 6.750%, 04/22/03 1,818,207
4,500,000 6.875%, 05/12/05 2,787,695
Treuhandanstalt
3,000,000 7.750%, 10/01/02 1,871,325
United Mexican States
6,000,000 8.125%, 09/10/04 3,624,722
World Bank
3,000,000 6.125%, 09/27/02 1,761,205
Government of Spain
ESP 500,000,000 6.000%, 01/31/08 3,469,149
480,000,000 7.900%, 02/28/02 3,499,321
500,000,000 8.400%, 04/30/01 3,631,028
480,000,000 10.300%, 06/15/02 3,795,810
Government of France
FF 20,000,000 5.250%, 04/25/08 3,375,156
20,000,000 6.000%, 10/25/25 3,529,040
20,000,000 8.500%, 11/25/02 3,836,145
30,000,000 8.500%, 10/25/19 6,917,324
Government of Ireland
IEP 3,000,000 6.500%, 10/18/01 4,421,555
Government of Netherlands
NLG 6,000,000 6.500%, 04/15/03 3,201,939
International Bank of Reconstruction
& Development
NZ$ 4,000,000 0.000%, 08/20/07 1,144,671
Government of Sweden
SEK 40,000,000 6.000%, 02/09/05 5,385,543
U.K. Treasury
(pound)2,500,000 7.250%, 12/07/07 4,611,135
2,500,000 7.500%, 12/07/06 4,628,121
2,000,000 8.500%, 12/07/05 3,863,475
2,000,000 9.000%, 07/12/11 4,300,416
2,000,000 9.750%, 08/27/02 3,799,711
United Mexican States
2,000,000 12.250%, 12/03/98 3,422,353
Ministry Finance Russia
US$ 3,000,000 9.250%, 11/27/01 2,942,902
Peoples Republic of China
3,000,000 6.625%, 10/28/02 2,976,539
Province of Ontario
3,000,000 7.625%, 06/22/04 3,210,000
The accompanying notes are an integral part of these financial statements.
35
<PAGE>
FREMONT GLOBAL FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Value
Face Amount/Issuer/Coupon Rate/Stated Maturity (Note 1)
- --------------------------------------------------------------------------------
FOREIGN BONDS (CONT.)
Republic of Kazakhstan
US$ 2,000,000 8.375%, 10/02/02 $ 1,956,181
2,000,000 9.250%, 12/20/99 2,075,772
Republic of Korea
2,000,000 8.875%, 04/15/08 1,967,040
United Mexican States
4,000,000 11.500%, 05/15/26 4,825,000
------------
137,351,457
------------
TOTAL BONDS (Cost $216,428,270) 217,505,727
------------
Shares/Face Amount/Issuer/Discount Rate/Stated Maturity
- --------------------------------------------------------------------------------
SHORT-TERM SECURITIES 5.2%
1,874,006 Benchmark Funds-Diversified Assets Portfolio 1,874,006
** $10,000,000 Exxon Imperial U.S., Inc.,
CP, 5.500%, 05/01/98 10,000,000
5,000,000 Merrill Lynch & Co., Inc.,
CP, 5.520%, 05/01/98 5,000,000
13,300,000 Merrill Lynch & Co., Inc.,
CP, 5.520%, 05/04/98 13,293,882
6,800,000 Sonoco Products, Inc.,
CP, 5.530%, 05/01/98 6,800,000
115,000 U.S. Treasury Bill, 4.950%, 06/25/98 114,126
------------
TOTAL SHORT-TERM SECURITIES (Cost $37,082,014) 37,082,014
------------
TOTAL INVESTMENTS (Cost $616,402,080), 100.1% 716,749,269
OTHER ASSETS AND LIABILITIES, NET, (0.1)% (665,062)
------------
NET ASSETS, 100.0% $716,084,207
============
** 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.
36
<PAGE>
FREMONT INTERNATIONAL GROWTH FUND
April 30, 1998
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
STOCKS 96.1%
BUSINESS EQUIPMENT & SERVICES 2.2%
180 SocieteGenerale de Surveillance
Holdings SA (Bearer Shares) SZ $ 306,192
11,266 Reuters Group PLC, ADR UK 730,178
------------
1,036,370
------------
CAPITAL GOODS 7.8%
18,100 Bombardier, Inc. (Class B) CN 488,284
8,000 Northern Telecom Ltd. CN 487,000
7,700 Kyocera Corp. JP 402,046
14,000 Murata Manufacturing Co. Ltd. JP 408,682
35,000 ABB AB (Series B) SW 542,054
17,000 Ericsson (L.M.) Telephone Co., ADR SW 874,438
260 ABB AG SZ 425,832
------------
3,628,336
------------
CONSUMER DURABLES 5.2%
3,800 Peugeot SA FR 659,277
600 Volkswagen AG GM 478,229
105,000 Nissan Motor Co. Ltd. JP 337,321
6,000 Sony Corp. JP 497,009
5,000 Philips Electronics NV (New York Shares) NL 450,000
------------
2,421,836
------------
CONSUMER NON-DURABLES 6.7%
45,000 Coca-Cola Amatil Ltd. AU 341,988
31,000 Asahi Breweries Ltd. JP 404,191
4,400 Nintendo Co. Ltd. JP 401,881
3,900 Sony Music Entertainment (Japan), Inc. JP 151,992
2,000 Heineken NV NL 463,524
8,000 South Africa Breweries Ltd. SA 268,381
280 Nestle SA (Registered Shares) SZ 542,477
26,000 Reckitt & Coleman PLC UK 523,559
------------
3,097,993
------------
CONSUMER SERVICES 2.9%
23,000 The Thomson Corp. CN 692,001
1,600 Canal Plus FR 277,856
* 7,000 ProSieben Media AG (Preferred) GM 348,051
------------
1,317,908
------------
ENERGY 6.5%
38,000 Broken Hill Proprietary Co. Ltd. AU 370,244
60,000 Woodside Petroleum Ltd. AU 390,899
* 15,000 Talisman Energy, Inc. CN 456,563
3,800 Total Cie Francaise des Petroles SA
(Class B) FR 451,516
65,000 ENI IT 435,535
8,500 Norsk Hydro ASA NO 423,548
30,000 British Petroleum PLC UK 473,903
------------
3,002,208
------------
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
FINANCIAL SERVICES 16.2%
57,000 Australia & New Zealand Banking
Group Ltd. AU $ 396,272
12,000 Westpac Banking Corp. Ltd. AU 80,284
8,500 Westpac Banking Corp. Ltd., ADR AU 287,406
8,000 Uniao de Bancos Brasileiros SA, GDR BR 318,000
7,500 Bank of Montreal CN 408,848
15,400 Bank Of Nova Scotia CN 422,441
9,000 Newcourt Credit Group, Inc. CN 441,556
5,500 Deutsche Bank AG GM 426,281
14,800 HSBC Holdings PLC (Hong Kong Shares) HK 422,120
14,800 Assicurazioni Generali SPA IT 445,295
88,000 Mitsui Marine and Fire Insurance Co. Ltd. JP 449,550
5,000 Nichiei Co. Ltd. (Kyoto) JP 387,466
4,200 Orix Corp. JP 289,132
6,000 Takefuji Corp. JP 313,734
30,000 The Nomura Securities Co. Ltd. JP 364,519
55,000 The Toyo Trust & Banking Co. Ltd. JP 318,211
3,200 Aegon NV NL 414,659
45,100 Development Bank of Singapore
(Foreign Registered) SG 299,053
11,000 ForeningsSparbanken AB (Series A) SW 343,559
30,000 Bank of Scotland UK 373,051
45,000 Guardian Royal Exchange PLC UK 302,555
------------
7,503,992
------------
HEALTH CARE 6.9%
2,700 Synthelabo FR 406,066
3,900 Astra AB (Series A) SW 80,030
46,300 Astra AB, ADR SW 952,044
434 Novartis AG (Registered Shares) SZ 716,591
24,000 Zeneca Group PLC UK 1,038,823
------------
3,193,554
------------
MULTI-INDUSTRY 6.3%
3,000 Lyonnaise Des Eaux-Dumez FR 508,517
14,000 Metallgesellschaft AG GM 292,316
101,000 Citic Pacific Ltd. HK 310,228
50,000 Hutchison Whampoa HK 309,092
65,000 Swire Pacific Ltd. (Class A) HK 324,643
3,400 Incentive AB SW 327,788
19,000 Siebe PLC UK 431,538
45,000 TI Group PLC UK 405,289
------------
2,909,411
------------
RAW MATERIALS 5.0%
15,000 Upm-Kymmene Oyj FI 450,128
2,500 Compagnie de Saint-Gobain FR 416,286
12,000 De Beers Centenary AG, ADR SA 309,000
2,867 Holderbank Financiere Glarus AG SZ 614,630
31,000 BOC Group PLC UK 531,955
------------
2,321,999
------------
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
37
<PAGE>
FREMONT INTERNATIONAL GROWTH FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
RETAIL 5.5%
100,000 Coles Myer Ltd. AU $ 481,966
500 Carrefour SA FR 286,248
20,000 Jusco Co. Ltd. JP 321,258
11,000 Koninklijke Ahold NV NL 342,747
40,000 Dixons Group PLC UK 382,835
86,000 Storehouse PLC UK 355,272
40,000 Tesco PLC UK 375,978
------------
2,546,304
------------
SHELTER 1.9%
46,000 Cheung Kong (Holdings) Ltd. HK 305,737
190,000 Hysan Development Co. Ltd. HK 269,730
35,000 Mitsui Fudosan JP 318,098
------------
893,565
------------
TECHNOLOGY 10.9%
20,400 Nokia AB, ADR FI 1,364,250
900 SAP AG (Preferred) GM 449,499
8,910 Advantest Corp. JP 596,614
6,000 Hirose Electronics JP 301,998
3,000 Rohm Co. Ltd. JP 337,208
30,000 Taiyo Yuden Co. Ltd. JP 339,239
13,000 Tokyo Electron Ltd. JP 508,596
* 5,500 ASM Lithography Holding NV NL 503,938
* 3,400 SGS-Thomson Microelectronics NV NL 287,300
* 14,000 Taiwan Semiconductor Manufacturing
Co. Ltd., ADR TW 343,875
------------
5,032,517
------------
UTILITIES 12.1%
14,000 Centrais Eletricas Brasileiras
SA-Eletrobras BR 290,641
20,000 Deutsche Telekom GM 510,022
700 Mannesmann AG GM 551,114
16,000 Hong Kong Telecommunications HK 29,941
75,000 Telecom Italia Mobile SPA IT 427,604
73,334 Telecom Italia SPA IT 548,504
51 Nippon Telegraph & Telephone JP 445,096
16,000 Telefonos de Mexico SA (Class L), ADR MX 906,000
12,000 Philippine Long Distance Tele Co., ADR PH 324,000
6,000 Portugal Telecom SA PT 322,500
20,000 Telefonica de Espana SA SP 834,071
* 6,300 COLT Telecom Group PLC UK 135,926
20,000 United Utilities PLC UK 279,309
------------
5,604,728
------------
TOTAL STOCKS (Cost $41,859,330) 44,510,721
------------
Country Value
Shares/Issuer Security Description Code (Note 1)
- --------------------------------------------------------------------------------
SHORT-TERM SECURITIES 2.9%
1,337,156 Benchmark Funds-
Diversified Assets Portfolio US $ 1,337,156
------------
TOTAL SHORT-TERM SECURITIES (Cost $1,337,156) 1,337,156
------------
TOTAL INVESTMENTS (Cost $43,196,486), 99.0% 45,847,877
OTHER ASSETS AND LIABILITIES, NET, 1.0% 455,221
------------
NET ASSETS, 100.0% $ 46,303,098
============
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
38
<PAGE>
FREMONT INTERNATIONAL SMALL CAP FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
STOCKS 91.2%
BUSINESS EQUIPMENT & SERVICES 14.3%
30,000 P4 Radio Hele Norge ASA NO $ 349,608
* 7,500 Investec-Consultoria Internacional, SA PT 309,614
1,160 PubliGroupe SA SZ 301,198
------------
960,420
------------
CONSUMER DURABLES 8.9%
10,000 Kverneland ASA NO 258,523
105,000 McBride PLC UK 344,201
------------
602,724
------------
CONSUMER NON-DURABLES 3.4%
584,000 Hung Hing Printing Group HK 226,108
------------
226,108
------------
FINANCIAL SERVICES 3.9%
* 20,000 United Panam Financial Corp. US 265,000
------------
265,000
------------
HEALTH CARE 14.3%
* 41,800 Physio-Control International Corp. US 961,400
------------
961,400
------------
RAW MATERIALS 14.6%
6,250 Rinol AG GM 278,396
3,100 Lanna Lignite Public Co. Ltd.
(Foreign Registered) TH 11,178
175,000 Victrex PLC UK 693,669
------------
983,243
------------
RETAIL 8.3%
* 1,650 The Selecta Group SZ 276,832
45,000 Regent Inns PLC UK 285,621
------------
562,453
------------
TECHNOLOGY (COMPONENTS) 9.9%
615,000 Electronic Resources Ltd. SG 668,014
------------
668,014
------------
TECHNOLOGY (EQUIPMENT) 4.0%
* 7,500 Orbotech Ltd. IS 270,938
------------
270,938
------------
TECHNOLOGY (SOFTWARE) 9.6%
70,000 JBA Holdings PLC UK 643,913
------------
643,913
------------
TOTAL STOCKS (Cost $6,096,563) 6,144,213
------------
Country Value
Shares/Issuer Security Description Code (Note 1)
- --------------------------------------------------------------------------------
SHORT-TERM SECURITIES 13.2%
890,037 Benchmark Funds-
Diversified Assets Portfolio US $ 890,037
------------
TOTAL SHORT-TERM SECURITIES (Cost $890,037) 890,037
------------
TOTAL INVESTMENTS (Cost $6,986,600), 104.4% 7,034,250
OTHER ASSETS AND LIABILITIES, NET, (4.4)% (297,702)
------------
NET ASSETS, 100.0% $ 6,736,548
============
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
39
<PAGE>
FREMONT EMERGING MARKETS FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENTS OF INVESTMENTS IN SECURITIES AND NET ASSETS
Country Value
Shares Security Description Code (Note 1)
- --------------------------------------------------------------------------------
STOCKS & CONVERTIBLE BONDS 97.0%
BUSINESS EQUIPMENT & SERVICES 1.8%
* 19,600 Mahanagar Telephone Nigam Ltd., GDR IN $ 316,050
------------
316,050
------------
CAPITAL GOODS 1.5%
107,000 Cheung Kong Infrastructure Holding Ltd. HK 271,349
------------
271,349
------------
CONSUMER DURABLES 1.8%
6,300,000 Tofas Turk Otomobil Fabrikasi TU 327,600
------------
327,600
------------
CONSUMER NON-DURABLES 4.4%
275,000 PT Daya Guna Samudera ID 248,688
16,000 South Africa Breweries Ltd. SA 536,762
------------
785,450
------------
CONSUMER SERVICES 5.0%
481,500 PT Sonas Topas Tourism ID 32,694
* 229,900 Corporacion Interamericana de
Entretenimiento SA (Series B) MX 863,868
------------
896,562
------------
ENERGY 6.2%
42,000 Shandong Huaneng Power Co. Ltd., ADR CH 304,500
20,800 Gazprom, ADR RU 383,760
6,200 Lukoil Holding, ADR RU 410,750
------------
1,099,010
------------
FINANCIAL SERVICES 9.9%
11,000 Banco Frances del Rio de la Plata SA, ADR AR 319,688
81,000 Bank Hapoalim Ltd. IS 216,912
202,100 Bank Leumi Le-Israel IS 368,436
* 15,800 Bank Handlowy W. Warszawie PO 293,066
* 285,000 Bank Sinopac TW 207,433
12,400 HSBC Holdings PLC (Hong Kong Shares) UK 353,668
------------
1,759,203
------------
HEALTH CARE 6.0%
3,400 Richter Gedeon HU 362,100
12,700 Ranbaxy Laboratories Ltd., GDR IN 314,325
* 45,050 Dar Al-Dawa Development and Investment JO 386,233
------------
1,062,658
------------
MISCELLANEOUS 1.3%
* 30,500 Saudi Arabia Investment Fund UK 234,850
------------
234,850
------------
MULTI-INDUSTRY 2.1%
6,200 Sasol Ltd. SA 62,546
* 474,100 Phoenix Pulp & Paper Public Co. Ltd. TH 304,383
------------
366,929
------------
RAW MATERIALS 6.9%
18,800 Petroleo Brasileiro SA, ADR BR 475,743
4,630 Titan Cement Co. SA GR 396,318
20,000 Pohang Iron & Steel Co. Ltd., ADR SK 356,250
------------
1,228,311
------------
REAL ESTATE INVESTMENT TRUSTS 0.9%
* 21,000 Uralmash Zavody, ADR RU $ 168,000
------------
168,000
------------
RETAIL 2.8%
* 18,375 Amika Wronki SA PO 330,009
250,000 Sawang Export Public Co. Ltd. TH 162,127
------------
492,136
------------
SHELTER 5.5%
42,000 Cheung Kong (Holdings) Ltd. HK 279,151
80,000 New World Development Co. Ltd. HK 227,657
* 16,000 Exbud SA, GDR PO 182,400
243,000 Keppel Land Ltd. SG 288,500
------------
977,708
------------
TECHNOLOGY 17.5%
* 21,100 Crystal Systems Solutions IS 385,075
* 168,000 Legend Holdings Ltd. HK 72,091
* 130,000 Hana Microelectronics Public Co. Ltd.
(Foreign Registered) TH 569,909
* 182,500 International Broadcasting Corporation
Public Co. Ltd. (Foreign Registered) TH 182,263
59,000 Shinawatra Computer Public Co. Ltd.
(Foreign Registered) TH 370,376
* 770,000 Netas Northern Electric
Telekomunikasyon AS TU 286,440
* 8,000 Asustek Computer, Inc. TW 163,035
* 110,000 Compal Electronics TW 478,703
$80,000 Orient Semiconductor Electronics Ltd.,
Convertible Bond, 1.500%, 02/26/03 TW 81,456
* 68,000 Siliconware Precision Industries Co. TW 164,976
* 19,500 ForSoft Ltd. US 358,314
------------
3,112,638
------------
TRANSPORTATION 1.7%
1,060,000 Zhejiang Expressway Co. Ltd. CH 255,817
* 3,910 Minoan Lines GR 38,571
------------
294,388
------------
UTILITIES (ELECTRIC) 5.0%
12,000 Centrais Electricas Brasileiras SA, ADR BR 269,575
* 12,600 Demasz RT, GDR HU 219,870
* 12,300 Unified Energy Systems, GDR RU 405,901
------------
895,346
------------
UTILITIES (TELECOMMUNICATIONS) 16.7%
8,800 Telecomunicacoes Brasileiras SA, ADR BR 1,071,950
3,346,762 Telecomunicacoes de Sao Paulo SA
(Preferred) BR 1,132,759
* 11,900 Matav RT, ADR HU 351,050
7,300 Telefonos de Mexico SA (Class L), ADR MX 413,363
------------
2,969,122
------------
TOTAL INVESTMENTS (Cost $17,169,769), 97.0% 17,257,310
OTHER ASSETS AND LIABILITIES, NET, 3.0% 527,678
------------
NET ASSETS, 100.0% $ 17,784,988
============
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
40
<PAGE>
FREMONT U.S. MICRO-CAP FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENTS OF INVESTMENTS IN SECURITIES AND NET ASSETS
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
STOCKS 87.5%
BUSINESS EQUIPMENT & SERVICES 18.4%
* 175,000 Able Telcom Holding Corp. $ 2,176,562
* 149,200 AmeriLink Corp. 3,450,250
* 111,700 Arguss Holdings, Inc. 1,989,656
* 21,000 DA Consulting Group, Inc. 370,125
* 259,200 Hospitality Worldwide Services 2,511,000
* 148,900 International Total Services, Inc. 3,033,838
* 118,000 Market Facts, Inc. 2,714,000
* 304,100 NuCO2, Inc. 3,383,113
* 142,900 Pentacon, Inc. 1,893,425
* 87,800 Rental Service Corp. 2,551,687
* 455,500 Richey Electronics, Inc. 4,327,250
* 29,850 Specialty Teleconstructors, Inc. 1,111,913
* 152,500 UOL Publishing, Inc. 1,658,437
* 323,900 Warrantech Corp. 2,125,593
------------
33,296,849
------------
CAPITAL GOODS 6.4%
* 20,000 AFC Cable Systems, Inc. 695,000
* 290,600 AVTEAM, Inc. 3,123,950
* 316,300 Channell Commercial Corp. 3,657,219
* 181,300 IMPCO Technologies, Inc. 2,266,250
* 243,000 Miller Industries, Inc. 1,913,625
------------
11,656,044
------------
CONSUMER DURABLES 0.1%
5,200 Craftmade International, Inc. 79,300
------------
79,300
------------
CONSUMER NON-DURABLES 7.2%
* 130,600 Il Fornaio (America) Corp. 1,763,100
* 112,000 RARE Hospitality International, Inc. 1,456,000
* 182,500 Star Buffet, Inc. 2,920,000
* 172,100 Steven Madden Ltd. 1,753,269
* 345,000 Taco Cabana, Inc. 2,285,625
* 81,000 Tefron Ltd. 2,171,813
* 25,500 USANA, Inc. 694,875
------------
13,044,682
------------
CONSUMER SERVICES 9.2%
* 342,500 Alliance Gaming Corp. 1,616,172
* 138,500 American Classic Voyages Co. 3,012,375
* 120,100 Cinar Films, Inc. (Class B) 2,311,925
* 189,900 Movie Gallery, Inc. 1,519,200
* 163,500 Precision Auto Care, Inc. 1,757,625
* 66,700 Royal Olympic Cruise Lines, Inc. 1,225,612
* 73,212 Saga Communications, Inc. (Class A) 1,670,148
* 51,800 Servico, Inc. 1,010,100
* 109,800 Silverleaf Resorts, Inc. 2,607,750
------------
16,730,907
------------
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
ENERGY 1.9%
* 98,500 KTI, Inc. $ 1,822,250
* 142,160 TransCoastal Marine Services, Inc. 1,634,840
------------
3,457,090
------------
HEALTH CARE 6.3%
* 23,650 Advance Paradigm, Inc. 943,044
* 158,700 Cytyc Corp. 2,301,150
* 170,700 Del Global Technologies Corp. 2,091,075
* 61,550 Gene Logic, Inc. 500,094
* 381,500 Genelabs Technologies, Inc. 1,382,938
* 32,000 Horizon Medical Products, Inc. 476,000
* 182,500 Intensiva Healthcare Corp. 1,482,812
* 65,700 Monarch Dental Corp. 1,075,837
* 35,800 Perclose, Inc. 1,087,425
------------
11,340,375
------------
RAW MATERIALS 1.1%
155,600 Northern Technologies International 1,293,425
* 78,000 Scheid Vineyards, Inc. (Class A) 760,500
------------
2,053,925
------------
RETAIL 10.4%
* 44,500 A.C. Moore Arts & Crafts, Inc. 845,500
* 219,600 Chico's Fas, Inc. 2,031,300
115,400 Delta Woodside Industries, Inc. 699,612
* 83,200 Elder-Beerman Stores Corp. 2,246,400
* 79,000 Finlay Enterprises, Inc. 2,162,625
* 55,800 Gadzooks, Inc. 1,464,750
* 99,300 Garden Ridge Corp. 1,899,112
* 10,000 Genesco, Inc. 169,375
* 173,700 Media Arts Group, Inc. 4,212,225
* 222,950 Successories, Inc. 1,226,225
* 66,000 Tractor Supply Co. 1,699,500
* 6,600 Urban Outfitters, Inc. 108,075
------------
18,764,699
------------
TECHNOLOGY (COMPONENTS) 10.1%
* 118,700 Anaren Microwave, Inc. 2,151,438
* 237,600 Ancor Communcations, Inc. 1,425,600
* 320,200 Interlink Electronics, Inc.(a) 1,601,000
* 41,300 Micrel, Inc. 1,621,025
* 457,700 Orckit Communications Ltd. 9,468,669
* 347,500 Southwall Technologies, Inc. 2,128,437
------------
18,396,169
------------
TECHNOLOGY (EQUIPMENT) 2.0%
* 136,500 Barringer Technologies, Inc. 1,638,000
* 88,900 Integrated Process Equipment Corp. 1,616,869
* 56,100 Schmitt Industries, Inc. 350,626
------------
3,605,495
------------
* Non-income producing securities
(a) Represents ownership of at least 5% of the voting securities of the issuer
and is, therefore, and affiliate as defined in the Investment Company Act of
1940; See Note 2 "Notes to Financial Statements."
The accompanying notes are an integral part of these financial statements.
41
<PAGE>
FREMONT U.S. MICRO-CAP FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
TECHNOLOGY (SOFTWARE) 14.4%
* 270,000 Acclaim Entertainment, Inc. $ 2,058,750
* 43,000 Broadvision, Inc. 795,500
* 58,600 Credit Management Solutions, Inc. 432,175
* 75,100 Document Sciences Corp. 246,422
* 136,600 Geoworks Corp. 648,850
* 5,300 Go2net, Inc. 143,100
* 314,800 ISG International Software Group Ltd. 3,226,700
* 317,700 MDSI Mobile Data Solutions, Inc. 4,844,925
* 164,500 OrCAD, Inc. 1,645,000
* 390,800 Peerless Systems Corp. 6,863,425
* 77,581 Peregrine Systems, Inc. 1,871,642
* 90,900 Template Software, Inc. 1,056,712
* 27,700 TSI International Software Ltd. 609,400
* 571,400 V-One Corp. 1,678,488
------------
26,121,089
------------
TOTAL STOCKS (Cost $159,058,832) 158,546,624
------------
Face Amount/Issuer/Discount Rate/Stated Maturity
- --------------------------------------------------------------------------------
SHORT-TERM SECURITIES 11.6%
** 5,000,000 Sony Capital Corp., CP, 5.550%, 05/06/98 4,996,146
5,000,000 International Telecommunications
Satellite Organization, CP, 5.520%, 05/04/98 4,997,700
** 5,000,000 Exxon Imperial U.S., Inc., CP 5.500%, 05/01/98 5,000,000
6,000,000 Gannett Co., Inc., CP, 5.500%, 05/05/98 5,996,333
------------
TOTAL SHORT-TERM SECURITIES (Cost $20,990,179) 20,990,179
------------
TOTAL INVESTMENTS (Cost $180,049,011), 99.1% 179,536,803
OTHER ASSETS AND LIABILITIES, NET, 0.9% 1,577,504
------------
NET ASSETS, 100.0% $181,114,307
============
* Non-income producing securities
** 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>
FREMONT U.S. SMALL CAP FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
STOCKS 91.2%
BUSINESS EQUIPMENT & SERVICES 28.2%
* 1,300 CSG Systems International, Inc. $ 59,150
* 4,600 IDT Corp. 141,163
* 5,500 Kroll-O'Gara Co. 117,219
* 600 Metzler Group, Inc. 20,775
3,400 National Data Corp. 138,762
* 4,000 Nova Corp. 136,000
* 15,500 NuCO2, Inc. 172,437
* 9,100 Pentacon, Inc. 120,575
* 9,500 PMT Services, Inc. 185,250
* 4,300 Rental Service Corp. 124,969
* 2,500 Specialty Teleconstructors, Inc. 93,125
* 5,500 Superior Services, Inc. 178,750
* 18,400 TeleTech Holdings, Inc. 276,000
* 8,000 U.S. Office Products Co. 141,500
* 4,300 Wackenhut Corrections Corp. 112,337
------------
2,018,012
------------
CAPITAL GOODS 3.9%
* 16,600 AVTEAM, Inc. 178,450
3,200 Wabash National Corp. 98,800
------------
277,250
------------
CONSUMER NON-DURABLES 3.7%
* 12,000 Consolidation Capital Corp. 264,750
------------
264,750
------------
CONSUMER SERVICES 9.6%
* 11,850 American Classic Voyages Co. 257,738
* 5,600 Cinar Films, Inc. (Class B) 107,800
* 6,000 Dollar Thrifty Automotive Group, Inc. 113,250
* 3,400 Servico, Inc. 66,300
* 6,000 Silverleaf Resorts, Inc. 142,500
------------
687,588
------------
FINANCIAL SERVICES 2.3%
2,500 Executive Risk, Inc. 166,719
------------
166,719
------------
HEALTH CARE 7.0%
* 6,500 Cytyc Corp. 94,250
* 3,700 FPA Medical Management, Inc. 46,250
* 1,900 Henry Schein, Inc. 74,100
* 13,500 Orthodontic Centers of America, Inc. 288,563
------------
503,163
------------
RETAIL 11.0%
18,100 Apple South, Inc. 285,075
* 5,000 Borders Group, Inc. 160,625
* 4,400 Garden Ridge Corp. 84,150
* 17,000 Rainforest Cafe, Inc. 257,656
------------
787,506
------------
TECHNOLOGY (COMPONENTS) 7.4%
* 3,400 Micrel, Inc. 133,450
* 19,000 Orckit Communications Ltd. 393,063
------------
526,513
------------
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
TECHNOLOGY (EQUIPMENT) 10.6%
* 12,000 ANTEC Corp. $ 237,000
* 4,000 Integrated Process Equipment Corp. 72,750
* 15,900 P-COM, Inc. 313,031
* 5,300 REMEC, Inc. 131,837
------------
754,618
------------
TECHNOLOGY (SOFTWARE) 7.5%
* 11,100 ISG International Software Group Ltd. 113,775
* 15,700 Peerless Systems Corp. 275,731
* 5,000 Rational Software Corp. 84,062
* 1,600 VeriSign, Inc. 61,401
------------
534,969
------------
TOTAL STOCKS (Cost $6,338,267) 6,521,088
------------
Shares/Issuer
- --------------------------------------------------------------------------------
SHORT-TERM SECURITIES 16.5%
1,175,233 Benchmark Funds-Diversified Assets Portfolio 1,175,233
------------
TOTAL SHORT-TERM SECURITIES (Cost $1,175,233) 1,175,233
------------
TOTAL INVESTMENTS (Cost $7,513,500), 107.7% 7,696,321
OTHER ASSETS AND LIABILITIES, NET, (7.7)% (552,556)
------------
NET ASSETS, 100.0% $ 7,143,765
============
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
43
<PAGE>
FREMONT SELECT FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
STOCKS 93.4%
BUSINESS EQUIPMENT & SERVICES 17.1%
* 4,400 Aspect Telecommunications Corp. $ 126,500
6,200 Diebold, Inc. 254,200
6,400 Equifax, Inc. 247,600
4,900 G & K Services, Inc. (Class A) 197,225
* 4,800 Harbinger Corp. 174,600
------------
1,000,125
------------
CONSUMER NON-DURABLES 3.8%
* 5,700 Owens-Illinois, Inc. 225,506
------------
225,506
------------
CONSUMER SERVICES 3.1%
* 3,200 Jacor Communications, Inc. 182,000
------------
182,000
------------
ENERGY 14.2%
2,800 Devon Energy Corp. 111,650
4,800 ENSCO International, Inc. 135,600
* 2,700 EVI, Inc. 143,775
* 4,400 R&B Falcon Corp. 141,075
* 7,400 The Houston Exploration Co. 172,975
2,300 Transocean Offshore, Inc. 128,512
------------
833,587
------------
FINANCIAL SERVICES 12.7%
4,400 ABN AMRO Holding NV 112,475
* 18,000 Anthracite Mortgage Capital, Inc. 252,000
1,600 CMAC Investment Corp. 103,300
2,900 Fremont General Corp. 161,675
1,800 Mercury General Corp. 116,550
------------
746,000
------------
HEALTH CARE 15.4%
* 3,000 Biogen, Inc. 133,125
* 9,800 Forest Laboratories, Inc. (Class A) 354,638
* 9,600 Ligand Pharmaceuticals 139,200
5,000 United States Surgical Corp. 157,500
* 2,100 Universal Health Services, Inc. 120,881
------------
905,344
------------
RAW MATERIALS 5.8%
* 5,200 Buckeye Technologies, Inc. 120,900
3,800 Solutia, Inc. 107,825
* 5,400 W.R. Grace & Co. 109,688
------------
338,413
------------
RETAIL 4.4%
* 6,400 Consolidated Stores Corp. 256,000
------------
256,000
------------
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
TECHNOLOGY 16.9%
* 7,700 Hexcel Corp. $ 215,119
* 3,000 Peoplesoft, Inc. 139,500
* 1,400 Storage Technology Corp. 118,212
2,200 Thiokol Corp. 118,525
* 8,700 Xilinx, Inc. 398,025
------------
989,381
------------
TOTAL STOCKS (Cost $5,182,933) 5,476,356
------------
Shares/Issuer
- --------------------------------------------------------------------------------
SHORT-TERM SECURITIES 6.7%
395,347 Benchmark Funds-Diversified Assets Portfolio 395,347
------------
TOTAL SHORT-TERM SECURITIES (Cost $395,347) 395,347
------------
TOTAL INVESTMENTS (Cost $5,578,280), 100.1% 5,871,703
OTHER ASSETS AND LIABILITIES, NET, (0.1)% (5,176)
------------
NET ASSETS, 100.0% $ 5,866,527
============
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
44
<PAGE>
FREMONT GROWTH FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
STOCKS 98.2%
BUSINESS EQUIPMENT & SERVICES 3.6%
* 35,300 American Business Information, Inc. (Class B) $ 503,025
14,100 Aspect Telecommunications Corp. 405,375
19,800 Diebold, Inc. 811,800
8,700 Equifax, Inc. 336,581
6,800 G & K Services, Inc. (Class A) 273,700
15,100 Harbinger Corp. 549,263
103,700 Waste Management, Inc. 3,473,950
------------
6,353,694
------------
CAPITAL GOODS 3.5%
27,300 Caterpillar, Inc. 1,554,394
25,400 Emerson Electric Co. 1,616,075
28,800 PACCAR, Inc. 1,710,000
9 Raytheon Co. (Class A) 497
10,800 W.W. Grainger, Inc. 1,176,525
------------
6,057,491
------------
CONSUMER DURABLES 3.7%
35,900 Chrysler Corp. 1,442,731
35,900 Ford Motor Co. 1,644,669
25,400 General Motors Corp. 1,711,325
23,100 Goodyear Tire & Rubber Co. 1,617,000
------------
6,415,725
------------
CONSUMER NON-DURABLES 2.3%
16,000 Campbell Soup Co. 821,000
33,000 Fort James Corp. 1,637,625
* 12,400 Owens-Illinois, Inc. 490,575
20,200 Quaker Oats Co. 1,050,400
------------
3,999,600
------------
CONSUMER SERVICES 4.9%
30,100 Disney (Walt) Co. 3,741,806
22,000 Gannett Co., Inc. 1,494,625
* 10,300 Jacor Communications, Inc. 585,813
21,000 The Times Mirror Co. (Class A) 1,284,938
23,200 Tribune Co. 1,531,200
* 1,600 Vlasic Foods International, Inc. 36,900
------------
8,675,282
------------
ENERGY 15.0%
16,000 ENSCO International, Inc. 452,000
* 9,000 EVI, Inc. 479,250
62,100 Exxon Corp. 4,529,419
22,700 Kerr-McGee Corp. 1,498,200
36,800 Mobil Corp. 2,907,200
43,800 Occidental Petroleum Corp. 1,289,363
31,400 Phillips Petroleum Co. 1,556,262
* 13,900 R&B Falcon Corp. 445,669
* 3,700 Santa Fe Energy Resources, Inc. 38,156
17,300 Schlumberger Ltd. 1,433,738
27,800 Tenneco, Inc. 1,197,137
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
ENERGY (CONT.)
34,200 Texaco, Inc. $ 2,103,300
13,500 The Houston Exploration Co. 315,562
3,600 Transocean Offshore, Inc. 201,150
34,300 USX-Marathon Group 1,228,369
16,700 Williams Cos., Inc. 528,137
------------
26,305,612
------------
FINANCIAL SERVICES (BANKS) 13.9%
14,400 ABN AMRO Holding NV 368,100
23,500 Ahmanson (H.F.) & Co. 1,791,875
27,000 Banc One Corp. 1,587,938
30,600 BankAmerica Corp. 2,601,000
9,700 Bankers Trust New York Corp. 1,252,513
16,100 Citicorp 2,423,050
16,700 First Chicago NBD Corp. 1,551,012
49,700 First Hawaiian, Inc. 1,950,725
22,000 First Union Corp. 1,328,250
25,200 Mellon Bank Corp. 1,814,400
28,400 NationsBank Corp. 2,151,300
44,900 Norwest Corp. 1,781,969
14,000 Republic New York Corp. 1,872,500
22,600 Suntrust Banks, Inc. 1,840,487
------------
24,315,119
------------
FINANCIAL SERVICES (OTHER) 9.6%
23,100 Allstate Corp. 2,223,375
29,775 American General Corp. 1,983,759
9,408 Associates First Capital Corp. 703,248
17,000 Chubb Corp. 1,341,937
5,200 CMAC Investment Corp. 335,725
35,900 Federal Home Loan Mortgage Corp. 1,662,619
9,000 Fremont General Corp. 501,750
4,400 General Re Corp. 983,675
12,300 Mercury General Corp. 796,425
26,600 Morgan Stanley, Dean Witter and Co. 2,098,075
49,200 Travelers Group, Inc. 3,010,425
29,100 Travelers Property Casualty Corp. 1,222,200
------------
16,863,213
------------
HEALTH CARE 5.6%
18,400 Baxter International, Inc. 1,020,050
* 9,800 Biogen, Inc. 434,875
* 31,100 Forest Laboratories, Inc. (Class A) 1,125,431
* 30,300 Ligand Pharmaceuticals 439,350
32,700 Pharmacia & Upjohn, Inc. 1,375,444
* 88,200 Tenet Healthcare Corp. 3,301,987
22,500 United Healthcare Corp. 1,580,625
16,300 United States Surgical Corp. 513,450
------------
9,791,212
------------
MULTI-INDUSTRY 1.6%
38,900 Allied-Signal, Inc. 1,704,306
19,400 TRW, Inc. 1,024,563
------------
2,728,869
------------
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
45
<PAGE>
FREMONT GROWTH FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
RAW MATERIALS 4.2%
21,100 Aluminum Co. of America $ 1,635,250
* 20,400 Buckeye Technologies, Inc. 474,300
15,700 Dow Chemical Co. 1,517,994
81,000 Engelhard Corp. 1,711,125
26,000 Goodrich (B.F.) Co. 1,399,125
12,100 Solutia, Inc. 343,337
* 17,000 W.R. Grace & Co. 345,313
------------
7,426,444
------------
REAL ESTATE INVESTMENT TRUSTS 0.6%
22,373 Starwood Hotels and Resorts 1,122,845
------------
1,122,845
------------
RETAIL 4.6%
* 20,900 Consolidated Stores Corp. 836,000
* 29,500 Federated Department Stores, Inc. 1,451,031
35,700 McDonalds Corp. 2,208,937
28,500 Penney (J.C.), Inc. 2,025,281
27,400 Sears, Roebuck and Co. 1,625,163
------------
8,146,412
------------
SHELTER 1.7%
30,600 International Paper Co. 1,596,938
19,400 Kimberly-Clark Corp. 984,550
* 9,100 Triangle Pacific Corp. 395,850
------------
2,977,338
------------
TECHNOLOGY 9.7%
31,100 AMP, Inc. 1,222,619
54,200 Boeing Co. 2,713,387
* 25,100 Hexcel Corp. 701,231
39,800 International Business Machines Corp. 4,611,825
29,800 Motorola, Inc. 1,657,625
* 16,600 Parametric Technology Corp. 530,681
* 3,100 Peoplesoft, Inc. 144,150
26,500 Rockwell International Corp. 1,482,344
* 6,300 Storage Technology Corp. 531,956
7,200 Thiokol Corp. 387,900
18,500 United Technologies Corp. 1,821,094
* 27,800 Xilinx, Inc. 1,271,850
------------
17,076,662
------------
TRANSPORTATION 1.7%
* 11,100 AMR Corp. 1,691,363
12,900 Burlington Northern Sante Fe 1,277,100
------------
2,968,463
------------
UTILITIES 12.0%
* 39,700 AirTouch Communications, Inc. 2,109,062
60,900 AT&T Corp. 3,657,806
41,600 BellSouth Corp. 2,670,200
29,200 Coastal Corp. 2,085,975
48,600 Entergy Corp. 1,208,925
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
UTILITIES (CONT.)
39,900 GPU, Inc. $ 1,581,038
51,500 PG&E Corp. 1,667,312
28,300 Texas Utilities Co. 1,132,000
54,000 Unicom Corp. 1,876,500
* 72,000 WorldCom, Inc. 3,080,250
------------
21,069,068
------------
TOTAL STOCKS (Cost $129,478,420) 172,293,049
------------
Shares/Face Amount/Issuer/Discount Rate/Stated Maturity
- --------------------------------------------------------------------------------
SHORT-TERM SECURITIES 1.7%
18,569 Benchmark Funds-Diversified Assets Portfolio 18,569
$2,700,000 Mitsui & Co. (U.S.A.), Inc.,
CP, 5.570%, 05/01/98 2,700,000
+ 55,000 U.S. Treasury Bill, 5.000%, 6/25/98 54,580
+ 210,000 U.S. Treasury Bill, 5.010%, 6/25/98 208,393
+ 60,000 U.S. Treasury Bill, 5.060%, 6/25/98 59,536
------------
TOTAL SHORT-TERM SECURITIES (Cost $3,041,078) 3,041,078
------------
TOTAL INVESTMENTS (Cost $132,519,498), 99.9% 175,334,127
OTHER ASSETS AND LIABILITIES, NET, 0.1% 188,992
------------
NET ASSETS, 100.0% $175,523,119
============
* Non-income producing securities
+ On deposit with broker for initial margin on futures contracts (Note 1). The
accompanying notes are an integral part of these financial statements.
46
<PAGE>
FREMONT REAL ESTATE SECURITIES FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
STOCKS 87.0%
CONSUMER SERVICES 3.6%
* 27,000 Servico, Inc. $ 526,500
* 10,000 Station Casinos, Inc. 148,750
------------
675,250
------------
REITs (APARTMENTS) 10.6%
5,200 Amli Residential Properties Trust 119,275
5,000 Apartment Investment & Management Co. 186,875
6,000 Associated Estates Realty Corp. 114,750
13,000 Berkshire Realty Company, Inc. 158,438
9,000 Equity Residential Properties Trust 442,125
8,000 Essex Property Trust, Inc. 264,000
15,000 Merry Land & Investment Co. 315,938
24,000 Town and Country Trust, The 415,500
------------
2,016,901
------------
REITs (COMMUNITY CENTERS) 10.7%
38,000 IRT Property Co. 441,750
36,400 Kranzco Realty Trust 650,650
39,200 Malan Realty Investors, Inc. 690,900
30,000 Mark Centers Trust 243,750
------------
2,027,050
------------
REITs (DIVERSIFIED) 9.0%
14,800 Aegis Realty, Inc. 181,300
22,000 Banyan Strategic Realty Trust 137,500
8,000 Boddie-Noell Properties, Inc. 115,000
1,900 Crescent Real Estate Equities Co. 64,837
17,000 Glenborough Realty Trust, Inc. 455,813
3,200 Pacific Gulf Properties, Inc. 70,400
17,000 Vornado Realty Trust 681,062
------------
1,705,912
------------
REITs (HOTELS) 17.3%
33,000 FelCor Suite Hotels, Inc. 1,155,000
15,568 Patriot American Hospitality, Inc. 393,092
34,504 Starwood Hotels and Resorts Trust 1,731,670
------------
3,279,762
------------
REITs (INDUSTRIAL) 3.5%
40,100 American Industrial Properties REIT 516,288
7,600 EastGroup Properties, Inc. 151,525
------------
667,813
------------
REITs (OFFICE) 19.0%
15,400 Arden Realty, Inc. 432,163
5,000 Brandywine Realty Trust 113,750
5,000 Cornerstone Properties, Inc. 90,000
10,000 Corporate Office Properties Trust, Inc. 105,625
8,000 Equity Office Properties Trust 227,500
21,800 G & L Realty Corp. 386,950
9,800 G & L Realty Corp. (Preferred A) 246,225
3,000 G & L Realty Corp. (Preferred B) 74,812
10,000 Highwoods Properties, Inc. 340,000
35,000 Mack-Cali Realty Corp. 1,314,687
8,000 Parkway Properties, Inc. 263,000
------------
3,594,712
------------
REITs (OFFICE/INDUSTRIAL) 6.9%
40,000 Prentiss Properties Trust 1,015,000
12,400 Reckson Associates Realty Corp. 303,800
------------
1,318,800
------------
Value
Shares Security Description (Note 1)
- --------------------------------------------------------------------------------
REITs (REGIONAL MALLS) 0.9%
5,000 Simon DeBartolo Group, Inc. $ 164,687
------------
164,687
------------
REITs (TRIPLE NET LEASE) 1.6%
11,500 Lexington Corporate Properties, Inc. 166,750
5,000 Realty Income Corp. 130,625
------------
297,375
------------
SHELTER 3.9%
* 31,000 Catellus Development Corp. 552,187
* 13,000 Wellsford Real Properties, Inc. 185,250
------------
737,437
------------
TOTAL STOCKS (Cost $16,723,776) 16,485,699
------------
Shares/Issuer
- --------------------------------------------------------------------------------
SHORT-TERM SECURITIES 12.2%
2,303,959 Benchmark Funds-Diversified Assets Portfolio 2,303,959
------------
TOTAL SHORT-TERM SECURITIES (Cost $2,303,959) 2,303,959
------------
TOTAL INVESTMENTS (Cost $19,027,735), 99.2% 18,789,658
OTHER ASSETS AND LIABILITIES, NET, 0.8% 146,053
------------
NET ASSETS, 100.0% $ 18,935,711
============
* Non-income producing securities
The accompanying notes are an integral part of these financial statements.
47
<PAGE>
FREMONT BOND FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Coupon Maturity Value
Face Amount Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------
BONDS 122.2%
FIXED RATE AND ADJUSTABLE RATE MORTGAGE SECURITIES 40.3%
<S> <C> <C> <C> <C>
$ 422,029 FHLMC............................................................6.500% 01/01/26 $ 418,995
190,239 FHLMC............................................................6.500% 03/01/26 188,872
266,559 FHLMC............................................................6.500% 04/01/26 264,643
198,998 FHLMC............................................................6.500% 05/01/26 197,568
520,826 FHLMC............................................................8.250% 08/01/17 547,284
223,044 FHLMC Gold Conv..................................................6.500% 04/01/26 221,441
542,573 FHLMC Gold Conv..................................................6.500% 04/01/26 538,672
10,000,000 FHLMC Gold TBA...................................................6.000% 06/10/28 9,671,875
4,000,000 FHLMC Gold TBA...................................................6.500% 05/13/28 3,963,750
546,545 FNMA.............................................................8.500% 05/01/25 571,479
598,751 FNMA ARM.........................................................7.820% 11/01/23 618,863
++ 1,761,144 GNMA.............................................................6.000% 01/15/24 1,704,453
++ 4,138,428 GNMA.............................................................6.000% 01/15/24 4,005,213
43,130 GNMA.............................................................6.500% 02/15/24 42,739
898,712 GNMA.............................................................6.500% 03/15/24 890,570
32,371 GNMA.............................................................6.500% 06/15/24 32,078
2,924,134 GNMA.............................................................8.000% 06/15/25 3,032,883
1,592,323 GNMA.............................................................8.000% 09/15/25 1,651,542
1,811,351 GNMA ARM.........................................................7.000% 10/20/25 1,847,504
1,220,406 GNMA II ARM......................................................7.000% 03/20/24 1,246,276
297,021 GNMA II ARM......................................................7.000% 11/20/24 303,000
2,567,049 GNMA II ARM......................................................7.000% 08/20/25 2,618,385
2,400,821 GNMA II ARM......................................................7.000% 11/20/26 2,446,819
207,757 GNMA II ARM......................................................7.375% 04/20/21 213,082
3,500,000 GNMA TBA.........................................................6.500% 05/20/28 3,468,828
5,000,000 GNMA TBA.........................................................8.000% 05/20/28 5,189,063
-----------
45,895,877
-----------
COLLATERALIZED MORTGAGE OBLIGATIONS 31.1%
480,861 Collateralized Mortgage Securities Corp. CMO, J-5Z, REMIC........7.985% 05/01/17 485,085
1,678,093 FHLMC CMO, 1018 0Z, PAC-1 (11) REMIC.............................7.000% 11/15/20 1,701,504
5,301,000 FHLMC CMO, FSPC Series T-011-A5, REMIC...........................6.500% 01/25/15 5,348,709
8,000,000 FHLMC CMO, FSPC Series T-011-A6, REMIC...........................6.500% 09/25/18 8,000,000
15,000,000 FNMA CMO, 1992-131KA, PAC(11) REMIC..............................8.000% 01/25/22 15,664,080
200,000 FNMA CMO, 1993-11J, PAC REMIC....................................7.500% 02/25/08 208,998
1,000,000 Morgan Stanley Mortgage Trust CMO, 40-8, PAC (11) REMIC..........7.000% 07/20/21 1,007,799
61,953 Resolution Trust Corp. CMO, 1992-M4 A1 REMIC.....................8.000% 09/25/21 61,779
3,000,000 Securitized Asset Sales, lnc. CMO, 1993-2A9, PAC (11) REMIC......6.200% 07/25/08 2,982,180
-----------
35,460,134
-----------
CORPORATE BONDS 44.6%
3,000,000 AT&T Capital Corp., 144A.........................................6.050% 04/01/99 2,997,690
4,000,000 BankAmerica Corp., FRN...........................................5.700% 03/05/01 3,996,204
2,000,000 Bankers Trust, FRN...............................................5.729% 01/30/02 1,994,700
3,000,000 Beneficial Corp., FRN............................................5.614% 01/09/02 3,002,190
5,000,000 Calenergy Co., Inc. (Step Bond).................................10.250% 01/15/04 5,362,500
1,000,000 Citicorp, FRN....................................................5.715% 08/13/02 999,140
2,000,000 Citicorp, FRN....................................................5.729% 11/12/02 2,000,040
829,000 Delta Air Lines, Inc. (Sinking Fund Bond), 144A..................9.450% 02/14/06 930,461
1,667,000 Delta Air Lines, Inc. (Sinking Fund Bond), 144A..................9.450% 02/26/06 1,872,191
2,000,000 Ford Motor Credit, FRN...........................................5.750% 02/13/03 1,999,438
3,000,000 Ford Motor Credit, FRN...........................................5.907% 03/05/01 3,004,581
3,000,000 Ford Motor Credit, FRN...........................................5.815% 09/03/01 2,996,268
2,000,000 Goldman Sachs Group, FRN, 144A...................................5.835% 11/24/00 2,000,380
3,000,000 Goldman Sachs Group, FRN, 144A...................................5.855% 02/22/02 2,994,303
2,000,000 Household Bank FSB...............................................5.848% 09/26/01 1,999,892
2,000,000 Imperial Chemical PLC (Callable 09-05-98 @100)...................5.750% 12/05/98 1,999,400
3,000,000 Salomon Inc......................................................5.732% 08/04/98 2,999,952
2,500,000 Teleport Communications (Step Bond)..............................0.000% 07/01/07 2,143,750
</TABLE>
++Securities pledged as collateral under reverse repurchase agreement (Note 1).
The accompanying notes are an integral part of these financial statements.
48
<PAGE>
FREMONT BOND FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares/ Coupon Maturity Value
Face Amount Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------
CORPORATE BONDS (CONT.)
<S> <C> <C> <C> <C>
$ 225,000 Time Warner, Inc.................................................7.975% 08/15/04 $ 240,431
450,000 Time Warner, Inc.................................................8.110% 08/15/06 491,315
450,000 Time Warner, Inc.................................................8.180% 08/15/07 495,153
1,000,000 United Airlines.................................................10.670% 05/01/04 1,202,929
3,000,000 Worldcom Inc.....................................................9.375% 01/15/04 3,165,000
-----------
50,887,908
-----------
FOREIGN BONDS 6.2%
AUS$ 2,000,000 Australian Government...........................................10.000% 10/15/07 1,685,361
NZ$ 1,500,000 Government of New Zealand........................................8.000% 04/15/04 863,528
NZ$ 1,300,000 Government of New Zealand.......................................10.000% 03/15/02 780,563
US$ 2,000,000 Republic of Argentina, FRN.......................................8.726% 04/10/05 2,010,000
US$ 1,900,000 Republic of Argentina, FRN
(Callable Semi-annually in March or September @100)............6.625% 03/31/05 1,743,250
-----------
7,082,702
-----------
STRIPPED MORTGAGE SECURITIES
1,079,460 FNMA lnterest Only, 1994-27WB, PAC-1 REMIC.......................6.500% 06/25/14 26,806
-----------
26,806
-----------
TOTAL BONDS (Cost $137,737,680) 139,353,427
-----------
OTHER SECURITIES 0.5%
20,000 Long Island Lighting Co. (Convertible Preferred Stock)...........1.763% 522,500
-----------
522,500
-----------
TOTAL OTHER SECURITIES (Cost $486,000) 522,500
-----------
<CAPTION>
Shares/ Discount
Face Amount Issuer Rate
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM SECURITIES 7.4%
<S> <C> <C> <C> <C>
5,695,406 Benchmark Funds - Diversified Assets Portfolio...................................... 5,695,406
# $2,000,000 FHLMC, AN........................................................5.950% 06/19/98 1,999,871
+ 40,000 U.S. Treasury Bill...............................................4.940% 07/23/98 39,544
+ 110,000 U.S. Treasury Bill...............................................4.950% 07/23/98 108,745
+ 25,000 U.S. Treasury Bill...............................................4.970% 07/23/98 24,714
+ 50,000 U.S. Treasury Bill...............................................4.975% 06/25/98 49,620
+ 290,000 U.S. Treasury Bill...............................................5.000% 07/23/98 286,657
+ 70,000 U.S. Treasury Bill...............................................5.010% 06/25/98 69,465
+ 110,000 U.S. Treasury Bill...............................................5.020% 06/25/98 109,156
------------
TOTAL SHORT-TERM SECURITIES (Cost $8,383,178) 8,383,178
------------
TOTAL INVESTMENTS (Cost $146,606,858), 130.1% 148,259,105
OTHER ASSETS AND LIABILITIES, NET, (30.1)% (34,260,780)
------------
NET ASSETS, 100.0% $113,998,325
============
</TABLE>
# The rate indicated for these securities is the stated coupon rate.
+ On deposit with broker for initial margin on futures contracts (Note 1).
The accompanying notes are an integral part of these financial statements.
49
<PAGE>
FREMONT MONEY MARKET FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Discount Maturity Value
Face Amount Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER 93.5%
<S> <C> <C> <C> <C>
$ **5,000,000 ABB Treasury Center........................................... 5.480% 06/01/98 $ 4,976,406
5,000,000 Abbott Laboratories........................................... 5.470% 05/20/98 4,985,565
5,000,000 Akzo Nobel, Inc............................................... 5.450% 05/26/98 4,981,076
5,000,000 Alcatel Alsthom, Inc.......................................... 5.500% 05/29/98 4,978,611
**5,000,000 Allianz of America Finance Corp............................... 5.540% 07/20/98 4,938,444
5,000,000 American Express Credit Corp.................................. 5.470% 06/02/98 4,975,689
**5,000,000 American General Corp......................................... 5.520% 05/22/98 4,983,900
5,000,000 Archer Daniels Midland Co..................................... 5.500% 06/10/98 4,969,444
5,000,000 Associates Corp. of North America............................. 5.520% 05/20/98 4,985,433
5,000,000 Australian Wheat Board........................................ 5.500% 07/01/98 4,953,403
5,000,000 B.B.V. Finance (Delaware), Inc................................ 5.460% 07/06/98 4,949,950
**5,000,000 Baker Hughes, Inc............................................. 5.540% 07/09/98 4,946,908
5,000,000 Banc One Corp................................................. 5.510% 05/13/98 4,990,817
5,000,000 Banque ET Caisse D'Epargne DE L'Etat.......................... 5.480% 07/20/98 4,939,111
5,000,000 Bell Atlantic Financial Corp.................................. 5.480% 05/26/98 4,980,972
5,000,000 Boral Industries, Inc......................................... 5.600% 05/01/98 5,000,000
**5,000,000 BTR Dunlop Finance, Inc....................................... 5.460% 08/14/98 4,920,375
5,000,000 C.I.T. Group Holdings, Inc.................................... 5.480% 06/04/98 4,974,122
5,000,000 Caisse d'Amortissement de la Dette Sociale.................... 5.610% 06/11/98 4,968,054
5,000,000 Canadian Wheat Board.......................................... 5.420% 05/11/98 4,992,472
5,000,000 Cargill, Inc.................................................. 5.460% 05/19/98 4,986,350
5,000,000 Carolina Power & Light Co..................................... 5.450% 05/08/98 4,994,701
5,000,000 Chevron UK Investment PLC..................................... 5.410% 06/12/98 4,968,442
5,000,000 Clorox Co..................................................... 5.430% 05/06/98 4,996,229
**5,000,000 Coca-Cola Co.................................................. 5.470% 05/27/98 4,980,247
5,000,000 Colgate-Palmolive Co.......................................... 5.480% 05/12/98 4,991,628
5,000,000 Columbia University, Trustees of.............................. 5.500% 05/08/98 4,994,653
5,000,000 Commonwealth Bank of Australia................................ 5.420% 10/13/98 4,875,792
5,000,000 Consolidation Coal Co......................................... 5.530% 05/18/98 4,986,943
5,000,000 Daimler-Benz North America Corp............................... 5.520% 07/15/98 4,942,500
**5,000,000 Dairy Investments (Bermuda) Ltd............................... 5.440% 05/19/98 4,986,400
5,000,000 Disney (Walt) Co.............................................. 5.460% 05/27/98 4,980,283
5,000,000 Dresdner U.S. Finance, Inc. .................................. 5.450% 07/06/98 4,950,042
5,000,000 Du Pont (E.I.) de Nemours & Co................................ 5.370% 07/07/98 4,950,029
5,000,000 Eastman Kodak................................................. 5.500% 05/04/98 4,997,708
5,000,000 Eksportfinans ASA............................................. 5.480% 07/27/98 4,933,783
5,000,000 Electricite de France......................................... 5.430% 07/13/98 4,944,946
5,000,000 Elf Aquitane Finance SA....................................... 5.480% 06/02/98 4,975,644
5,000,000 Export Development Corp....................................... 5.500% 05/04/98 4,997,708
**5,000,000 Exxon Imperial U.S., Inc...................................... 5.500% 05/07/98 4,995,417
5,000,000 Ford Motor Credit Corp........................................ 5.450% 05/08/98 4,994,701
5,000,000 Gannett Co., Inc.............................................. 5.480% 06/05/98 4,973,361
5,000,000 General Electric Capital Corp................................. 5.370% 08/28/98 4,911,246
**5,000,000 Glaxo Wellcome Holdings PLC................................... 5.400% 05/21/98 4,985,000
5,000,000 General Motors Acceptance Corp................................ 5.450% 06/08/98 4,971,236
5,000,000 Goldman Sachs & Co............................................ 5.630% 05/08/98 4,994,526
5,000,000 Halifax Building Society...................................... 5.520% 05/05/98 4,996,933
**5,000,000 Heinz (H.J.) & Co............................................. 5.490% 05/27/98 4,980,175
5,000,000 Henkel Corp................................................... 5.430% 05/04/98 4,997,738
5,000,000 Hershey Foods Corp............................................ 5.410% 05/01/98 5,000,000
5,000,000 Hitachi America Ltd........................................... 5.400% 07/20/98 4,940,000
5,000,000 International Business Machines Credit Corp................... 5.490% 06/01/98 4,976,363
5,000,000 International Telecommunications Satellite Organization....... 5.500% 05/07/98 4,995,417
5,000,000 John Deere Capital Corp....................................... 5.400% 05/01/98 5,000,000
**5,000,000 Johnson Controls, Inc......................................... 5.500% 05/27/98 4,980,139
5,000,000 Lucent Technologies, Inc...................................... 5.490% 05/28/98 4,979,413
**5,000,000 Marsh & McLennan Cos., Inc.................................... 5.390% 09/11/98 4,900,435
5,000,000 Merrill Lynch & Co., Inc...................................... 5.470% 07/14/98 4,943,781
5,000,000 MetLife Funding, Inc.......................................... 5.460% 06/09/98 4,970,425
</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.
50
<PAGE>
FREMONT MONEY MARKET FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Discount Maturity Value
Face Amount Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (CONT.)
<S> <C> <C> <C> <C>
$ 5,000,000 Mitsubishi International Corp................................. 5.510% 07/13/98 $ 4,944,135
5,000,000 Mitsui & Co. (U.S.A.), Inc.................................... 5.540% 05/29/98 4,978,456
5,000,000 Morgan (J.P.) & Co., Inc...................................... 5.390% 07/10/98 4,947,597
5,000,000 National Rural Utilities Cooperative Finance Corp............. 5.490% 05/07/98 4,995,425
**5,000,000 Novartis Finance Corp......................................... 5.480% 05/28/98 4,979,450
5,000,000 PACCAR Financial Corp......................................... 5.500% 05/05/98 4,996,944
**5,000,000 Panasonic Finance America..................................... 5.430% 09/04/98 4,904,975
**5,000,000 Pearson, Inc.................................................. 5.520% 05/04/98 4,997,700
**5,000,000 Petrofina Delaware, Inc....................................... 5.510% 05/27/98 4,980,103
5,000,000 Province British Columbia..................................... 5.450% 06/09/98 4,970,479
**5,000,000 Queen's Health Systems........................................ 5.500% 05/18/98 4,987,014
5,000,000 Rabobank Nederland............................................ 5.400% 09/14/98 4,898,000
5,000,000 Repsol International Finance BV............................... 5.520% 06/03/98 4,974,883
**5,000,000 Rexam PLC..................................................... 5.480% 06/19/98 4,962,706
5,000,000 Rio Tinto America, Inc........................................ 5.430% 05/01/98 5,000,000
5,000,000 Royal Bank of Canada.......................................... 5.380% 07/28/98 4,934,244
**5,000,000 Rubbermaid, Inc............................................... 5.500% 06/10/98 4,969,444
5,000,000 Sharp Electronics Corp........................................ 5.510% 06/10/98 4,969,389
5,000,000 Siemens Capital Corp.......................................... 5.380% 05/29/98 4,979,078
2,000,000 Sonoco Products, Inc.......................................... 5.530% 05/01/98 2,000,000
**5,000,000 St. Paul Cos., Inc............................................ 5.420% 05/22/98 4,984,192
5,000,000 Stanford, Leland Junior University............................ 5.400% 01/04/99 4,814,000
5,000,000 Sweden, Kingdom of............................................ 5.380% 12/02/98 4,839,347
**5,000,000 Swiss Re Financial Products................................... 5.500% 07/27/98 4,933,542
5,000,000 Toshiba Capital (Asia) Ltd.................................... 5.530% 05/18/98 4,986,943
5,000,000 Toyota Motor Credit Corp...................................... 5.510% 05/05/98 4,996,939
5,000,000 Transamerica Finance Corp..................................... 5.560% 05/13/98 4,990,733
**5,000,000 TRW, Inc...................................................... 5.520% 05/27/98 4,980,067
**5,000,000 Unilever Capital Corp......................................... 5.380% 06/05/98 4,973,847
5,000,000 USAA Capital Corp............................................. 5.450% 07/17/98 4,941,715
5,000,000 Wool International............................................ 5.440% 06/18/98 4,963,733
5,000,000 Xerox Corp.................................................... 5.470% 06/10/98 4,969,611
5,000,000 Yale University............................................... 5.480% 06/26/98 4,957,378
------------
TOTAL COMMERCIAL PAPER (Cost $454,013,155) 454,013,155
------------
<CAPTION>
Shares/ Coupon
Face Amount Issuer Rate
- -------------------------------------------------------------------------------------------------------------------
OTHER SHORT-TERM SECURITIES 9.7%
<S> <C> <C> <C> <C>
2,265,107 Benchmark Funds-Diversified Assets Portfolio........................................ 2,265,107
$ 5,000,000 Abbey National Treasury Services, Inc., YCD................... 5.875% 12/22/98 5,009,743
5,000,000 Deutsche Bank NY, YCD......................................... 5.700% 03/30/99 4,997,817
10,000,000 FHLB, AN...................................................... 5.435% 02/02/99 9,987,698
10,000,000 FHLB, AN...................................................... 5.579% 01/27/99 9,997,680
10,000,000 FNMA, AN...................................................... 5.570% 03/05/99 9,997,131
5,000,000 International Lease Finance Corp., Corp. Bond................. 5.500% 01/15/99 4,992,282
------------
TOTAL OTHER SHORT-TERM SECURITIES (Cost $47,247,458) 47,247,458
------------
TOTAL INVESTMENTS (Cost $501,260,613), 103.2% 501,260,613
OTHER ASSETS AND LIABILITIES, NET, (3.2)% (15,633,000)
------------
NET ASSETS, 100.0% $485,627,613
============
</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.
51
<PAGE>
FREMONT CALIFORNIA INTERMEDIATE TAX-FREE FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS IN SECURITIES AND NET ASSETS
<TABLE>
<CAPTION>
Coupon Maturity Value
Face Amount Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS 92.5%
<S> <C> <C> <C> <C>
$ 1,000,000 City of Anaheim, Public Finance Authority Revenue Bond,
Anaheim Electric Utility Projects............................ 5.600% 10/01/16 $ 1,026,340
1,000,000 Big Bear Area Regional Wastewater Agency, California Revenue... 5.000% 04/01/10 1,015,100
1,000,000 California State Dept. of Veterans Affairs,
Home Purchase Revenue 1991 Ser. A............................ 6.450% 08/01/00 1,034,330
500,000 California State Dept. of Water Resources,
Central Valley Project Revenue............................... 4.800% 12/01/07 506,740
1,000,000 California State Dept. of Water Resources,
Central Valley Project Revenue Ser. H........................ 6.400% 12/01/00 1,061,800
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 1,065,710
1,000,000 California State Public Works Board, Lease Revenue
Dept. of Corrections, Prison D............................... 5.100% 06/01/06 1,029,900
1,000,000 Contra Costa Transportation Authority,
Sales Tax Revenue 1991 Ser. A................................ 6.400% 03/01/01 1,060,510
1,000,000 Contra Costa Water Authority, Water Treatment
Revenue Refunding 1993 Ser. A (FGIC Insured)................. 5.300% 10/01/05 1,046,410
1,000,000 Contra Costa Water District,
Water Revenue Ser. F (FGIC Insured).......................... 5.250% 10/01/08 1,035,180
1,000,000 East Bay CA MUD, Water System Subordinated Revenue Ser. 1994... 8.500% 06/01/98 1,003,840
1,000,000 City of Fairfield, Water Revenue (AMBAC Insured)............... 5.250% 04/01/14 1,007,680
1,225,000 City of Industry, Urban Development
Agency Tax Allocation (MBIA Insured)......................... 5.250% 05/01/12 1,248,998
1,000,000 City of Irvine, Assessment District No. 89-10,
Limited Obligation Refunding Improvement (MBIA Insured)...... 4.200% 09/02/05 982,350
1,000,000 City of Los Angeles, Convention & Exhibition Center Authority,
Lease Revenue Bonds Refunding Ser. A......................... 5.200% 08/15/09 1,030,000
1,500,000 City of Los Angeles, Wastewater System
Revenue Ser. A (MBIA Insured)................................ 5.000% 12/01/11 1,513,080
1,000,000 City of Los Angeles, Wastewater System
Revenue Ser. B (MBIA Insured)................................ 5.700% 06/01/23 1,028,670
1,000,000 Los Angeles Dept. of Water & Power, Electric Plant Revenue..... 4.700% 10/15/06 1,007,990
1,000,000 Los Angeles Dept. of Water & Power,
Electric Plant Revenue Refunding............................. 5.500% 09/01/07 1,053,530
1,000,000 Los Angeles Dept. of Water & Power,
Waterworks Revenue Refunding................................. 5.625% 04/15/08 1,054,340
1,000,000 Los Angeles County Public Works Finance Authority,
Lease Revenue Ser. B (MBIA Insured).......................... 5.250% 09/01/09 1,045,390
500,000 Los Angeles County Public Works Finance Authority,
Regional Park and Open Space District, Ser. A................ 5.000% 10/01/04 516,885
1,000,000 Los Angeles County Public Works Finance Authority,
Regional Park and Open Space District, Ser. A................ 5.000% 10/01/16 967,230
750,000 Los Angeles County Sanitation District
Finance Authority, 1993 Ser. A............................... 5.250% 10/01/06 783,195
1,000,000 M-S-R Public Power Agency, San Juan Project Revenue Ser. F..... 5.650% 07/01/03 1,062,390
1,000,000 Metropolitan Water District of Southern California,
Waterworks GO Refunding 1993 Ser. A.......................... 5.250% 03/01/05 1,047,850
1,000,000 Modesto High School District, 1993 GO Refunding (FGIC Insured). 5.300% 08/01/04 1,050,890
1,000,000 Modesto Irrigation District Finance Authority,
Domestic Water Project Revenue 1992 Ser. A (AMBAC Insured)... 5.650% 09/01/03 1,069,950
1,000,000 Northern California Power Agency,
Geothermal Project #3 Revenue Ser. A......................... 5.600% 07/01/06 1,042,490
1,000,000 Orange County Transportation Authority, Measure M
Sales Tax Revenue First Ser. 1992............................ 6.000% 02/15/06 1,090,040
1,000,000 Orange County Transportation Authority, Measure M
Sales Tax Revenue Second Senior Ser. 1994 (FGIC Insured)..... 5.000% 02/15/08 1,028,000
500,000 Orange County Water District, COP 1990 Project A............... 6.500% 08/15/98 503,810
500,000 City of Pasadena, Electric Works Revenue Ser. 1990............. 6.500% 08/01/99 516,480
500,000 City of Pasadena, GO Refunding Police and Jail Building 1993... 5.000% 06/01/07 508,025
1,000,000 Rancho Cucamonga RDA, 1994 Tax
Allocation Refunding (MBIA Insured).......................... 5.000% 09/01/07 1,025,230
1,000,000 City of Riverside, Electric Revenue 1991....................... 6.100% 10/01/00 1,046,990
1,000,000 City of Riverside, Electric Revenue Refunding 1993............. 5.000% 10/01/06 1,025,500
1,000,000 City of Riverside, Electric Revenue
Refunding 1993 (AMBAC Insured)............................... 5.000% 10/01/13 989,370
1,000,000 Sacramento MUD, Electric Revenue 1991 Ser. Y................... 6.250% 09/01/00 1,049,870
2,000,000 Sacramento MUD, Electric Revenue 1997 Ser. L................... 5.125% 07/01/15 1,991,940
</TABLE>
The accompanying notes are an integral part of these financial statements.
52
<PAGE>
FREMONT CALIFORNIA INTERMEDIATE TAX-FREE FUND
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Coupon Maturity Value
Face Amount Issuer Rate Date (Note 1)
- ----------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS (CONT.)
<S> <C> <C> <C> <C>
$ 1,000,000 Sacramento County Sanitation District Finance Authority,
Revenue Bond (MBIA Insured).................................. 5.000% 12/01/08 $ 1,022,760
1,000,000 Sacramento County Sanitation District Finance Authority,
Revenue Bond (MBIA Insured).................................. 5.125% 12/01/13 995,180
1,000,000 San Bernardino County Transportation Authority,
Sales Tax Revenue 1992 Ser. A (FGIC Insured)................. 6.000% 03/01/03 1,073,590
1,000,000 City and County of San Francisco International Airport,
Revenue Second Ser. Issue 1 (AMBAC Insured).................. 6.100% 05/01/03 1,080,250
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 1,050,210
1,000,000 City and County of San Francisco RDA,
Tax Allocation 1997 Ser. B................................... 5.700% 08/01/14 1,023,420
1,000,000 City and County of San Francisco Sewer,
Revenue Refunding Ser. 1992 (AMBAC Insured).................. 5.800% 10/01/05 1,069,550
1,000,000 City of San Jose, Finance Authority (Convention Center
Refunding Project) 1993 Ser. C (MBIA Insured)................ 5.750% 09/01/03 1,057,160
1,000,000 Santa Margarita/Dana Point Authority
Orange County, Revenue Bond Ser. A........................... 5.375% 08/01/04 1,053,280
1,000,000 Santa Monica-Malibu Unified School District,
Public School Facilities Reconstruction Projects............. 5.500% 08/01/18 1,011,220
1,000,000 Southern California Public Power Authority,
Mead-Phoenix Project Revenue 1994 Ser. A (AMBAC Insured)..... 4.750% 07/01/08 1,006,670
1,000,000 Southern California Public Power Authority,
Mead-Phoenix Project Revenue 1994 Ser. A (AMBAC Insured)..... 4.750% 07/01/09 1,001,950
1,000,000 Southern California Public Power Authority,
Palo Verde Power Projects Revenue 1993 Ser. A................ 5.100% 07/01/06 1,051,890
500,000 City of Stockton, 1990 Wastewater System
Project COP (AMBAC Insured).................................. 6.700% 09/01/98 504,785
500,000 City of Stockton, 1990 Wastewater System
Project COP (AMBAC Insured).................................. 6.800% 09/01/99 509,890
1,250,000 City of Stockton, Wastewater System Project Ser. A............. 4.125% 09/01/06 1,211,738
1,000,000 University of California, Housing System
Revenue 1993 Ser. A (MBIA Insured)........................... 5.500% 11/01/08 1,053,970
500,000 University of California, Research Facilities
Revenue 1995 Ser. C (AMBAC Insured).......................... 5.100% 09/01/07 515,700
1,000,000 West & Central Basin Finance Authority, West Basin
Water Revenue Refunding Project (AMBAC Insured).............. 5.125% 08/01/06 1,035,740
1,000,000 City of Whittier, Solid Waste Revenue Ser. A (AMBAC Insured)... 5.375% 08/01/14 1,013,550
1,500,000 Yucaipa School Facilities Finance Authority,
1995 Sweetwater Refunding (MBIA Insured)..................... 6.000% 09/01/10 1,594,259
-----------
TOTAL MUNICIPAL BONDS (Cost $58,524,548) 61,110,785
-----------
<CAPTION>
Shares/
Face Amount Issuer
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM SECURITIES 4.7%
<S> <C> <C> <C> <C>
995,551 Provident Institutional Fund: Municipal Fund
for California Investors, Inc................................ 995,551
$ 2,100,000 Marin County, Tax and Revenue Anticipation Notes, 1997 Ser. L.. 4.500% 07/31/98 2,103,024
-----------
TOTAL SHORT-TERM SECURITIES (Cost $3,099,080) 3,098,575
-----------
TOTAL INVESTMENTS (Cost $61,623,628), 97.2% 64,209,360
OTHER ASSETS AND LIABILITIES, NET, 2.8% 1,884,941
-----------
NET ASSETS, 100.0% $66,094,301
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
53
<PAGE>
FREMONT MUTUAL FUNDS, INC.
<TABLE>
<CAPTION>
Country Diversification, Portfolio Abbreviations and Currency Abbreviations - April 30, 1998 (Unaudited)
- ----------------------------------------------------------------------------------------------------------
COUNTRY DIVERSIFICATION
Country Country International International Emerging
Code Name Global Growth Small Cap Markets Bond
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
AR Argentina 2.1% - - 1.8% -
AS Austria 0.6% - - - -
AU Australia 0.1% 5.1% - - 1.5%
BE Belgium 0.3% - - - -
BR Brazil - 1.3% - 17.0% -
CH China - - - 3.2% -
CL Chile 0.1% - - - -
CN Canada 2.9% 7.3% - - -
DK Denmark 0.2% - - - -
FI Finland 0.5% 3.9% - - -
FR France 4.4% 6.6% 0.1% - -
GM Germany 4.4% 6.6% 4.1% - -
GR Greece - - - 2.5% -
HK Hong Kong 0.4% 3.4% 3.4% 4.8% -
HU Hungary - - - 5.3% -
ID Indonesia 0.1% - - 1.6% -
IN India 0.1% - - 3.5% -
IR Ireland 0.8% - - - -
IS Israel - - 4.0% 7.5% -
IT Italy 0.6% 4.0% - - -
JP Japan 1.5% 17.0% - - -
JO Jordan - - - 2.2% -
MX Mexico 0.7% 2.0% - 7.2% -
MY Malaysia 0.2% - - - -
NL Netherlands 1.9% 5.3% - - -
NO Norway 0.1% 0.8% 5.1% - -
NZ New Zealand 0.2% - - - 1.4%
PE Peru 0.1% - - - -
PH Philippines 0.1% 0.7% - - -
PO Poland - - - 4.5% -
PT Portugal 0.2% 0.7% 4.6% - -
RU Russia - - - 7.7% -
SA South Africa - 1.3% - 3.4% -
SG Singapore 0.3% 0.7% 9.9% 1.6% -
SK South Korea 0.5% - - 2.0% -
SP Spain 2.5% 1.8% - - -
SW Sweden 1.4% 6.8% - -
SZ Switzerland 1.4% 5.6% 8.6% - -
TH Thailand - - 0.6% 8.9% -
TU Turkey - - - 3.5% -
TW Taiwan 0.1% 0.7% - 6.7% -
UK United Kingdom 7.6% 14.5% 28.9% 3.3% -
US United States 63.6% 3.9% 30.7% 1.8% 97.1%
------ ------ ------ ------ ------
Total 100.0% 100.0% 100.0% 100.0% 100.0%
====== ====== ====== ====== ======
</TABLE>
The Fremont Funds not listed above include 100% domestic securities in their
respective portfolios.
PORTFOLIO ABBREVIATIONS
ADR American Depository Receipt
AMBAC American Municipal Bond Assurance Corp.
AN Agency Note
ARM Adjustable Rate Mortgage
CMO Collateralized Mortgage Obligation
COP Certificates of Participation
CP Commercial Paper
FFCB Federal Farm Credit Bank
FGIC Financial Guaranty Insurance Corp.
FHLB Federal Home Loan Bank
FHLMC Federal Home Loan Mortgage Corp.
FNMA Federal National Mortgage Association
FRN Floating Rate Note
FSB Federal Savings Bank
FSPC FHLMC Structured Pass-Thru Certificates
GDR Global Depository Receipt
GDS Global Depository Shares
GNMA Government National Mortgage Association
GO General Obligation
MBIA Municipal Bond Investor Assurance Corp.
MUD Municipal Utility District
PAC Planned Amortization Class
RDA Redevelopment Agency
REIT Real Estate Investment Trust
REMIC Real Estate Mortgage Investment Conduit
TBA To Be Announced
YCD Yankee Certificate of Deposit
CURRENCY ABBREVIATIONS
ATS Austrian Schilling
AUS$ Australian Dollar
CAN$ Canadian Dollar
DM German Deutschemark
ESP Spanish Peseta
FF French Franc
IEP Irish Punt
NLG Netherlands Guilder
NZ$ New Zealand Dollar
SEK Swedish Krona
(pound) British Pound
US$ U.S. Dollar
The accompanying notes are an integral part of these financial statements.
54
<PAGE>
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55
<PAGE>
FREMONT MUTUAL FUNDS, INC.
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
(All numbers in thousands except net asset value per share)
<TABLE>
<CAPTION>
International International Emerging U.S.
Global Growth Small Cap Markets Micro-Cap
Fund Fund Fund Fund Fund
-----------------------------------------------------------------
Assets:
<S> <C> <C> <C> <C> <C>
Investments in securities at cost $ 616,402 $ 43,196 $ 6,987 $ 17,170 $ 180,049
========= ========= ========= ========= =========
Investments in securities at
value (Note 1) 716,749 45,848 7,034 17,257 179,537
Cash 1 -- 2 -- --
Dividends and interest receivable 6,023 170 31 93 1
Receivable for securities sold 2,413 73 24 397 5,915
Receivable from management company -- -- -- 1 --
Receivable from sale of fund shares 1,001 490 7 119 4,043
Variation margin receivable -- -- -- -- --
Unrealized appreciation on foreign
currency contracts (Note 1) 604 7 -- -- --
Prepaid expense 5 -- -- -- --
Unamortized organization costs (Note 3) -- -- -- 14 --
--------- --------- --------- --------- ---------
Total assets 726,796 46,588 7,098 17,881 189,496
--------- --------- --------- --------- ---------
Liabilities:
Bank overdraft -- -- -- 44 1,607
Payable for securities purchased 7,446 215 352 13 6,023
Payable for fund shares redeemed 833 -- 1 14 477
Unrealized depreciation on foreign
currency contracts (Note 1) 1,804 13 -- -- --
Accrued expenses:
Investment advisory, administrative
and distribution fees 456 50 8 17 275
Other 173 7 -- 8 --
--------- --------- --------- --------- ---------
Total liabilities 10,712 285 361 96 8,382
--------- --------- --------- --------- ---------
Net assets $ 716,084 $ 46,303 $ 6,737 $ 17,785 $ 181,114
========= ========= ========= ========= =========
Net assets consist of:
Paid in capital $ 602,322 $ 39,935 $ 8,987 $ 18,731 $ 159,261
Undistributed net investment
income (loss) 1,800 106 (162) 83 (935)
Unrealized appreciation (depreciation)
on investments 100,347 2,651 48 88 (512)
Unrealized depreciation on foreign
currency contracts and other
assets and liabilities (1,196) (10) (1) (1) --
Accumulated net realized gain (loss) 12,811 3,621 (2,135) (1,116) 23,300
--------- --------- --------- --------- ---------
Net assets $ 716,084 $ 46,303 $ 6,737 $ 17,785 $ 181,114
========= ========= ========= ========= =========
Shares of capital stock outstanding 47,174 4,052 856 1,842 8,098
========= ========= ========= ========= =========
Net asset value per share $ 15.18 $ 11.43 $ 7.87 $ 9.65 $ 22.36
========= ========= ========= ========= =========
<CAPTION>
Real
U.S. Estate
Small Cap Select Growth Securities
Fund Fund Fund Fund
--------------------------------------------------
Assets:
<S> <C> <C> <C> <C>
Investments in securities at cost $ 7,514 $ 5,578 $ 132,519 $ 19,028
========= ========= ========= =========
Investments in securities at
value (Note 1) 7,696 5,872 175,334 18,790
Cash -- -- -- --
Dividends and interest receivable 4 3 181 37
Receivable for securities sold 251 -- -- 105
Receivable from management company -- -- -- --
Receivable from sale of fund shares 17 -- 206 226
Variation margin receivable -- -- 22 --
Unrealized appreciation on foreign
currency contracts (Note 1) -- -- -- --
Prepaid expense -- -- 3 --
Unamortized organization costs (Note 3) 8 -- -- --
--------- --------- --------- ---------
Total assets 7,976 5,875 175,746 19,158
--------- --------- --------- ---------
Liabilities:
Bank overdraft -- -- -- --
Payable for securities purchased 821 -- -- 209
Payable for fund shares redeemed -- -- 52 --
Unrealized depreciation on foreign
currency contracts (Note 1) -- -- -- --
Accrued expenses:
Investment advisory, administrative
and distribution fees 8 6 94 4
Other 3 2 77 9
--------- --------- --------- ---------
Total liabilities 832 8 223 222
--------- --------- --------- ---------
Net assets $ 7,144 $ 5,867 $ 175,523 $ 18,936
========= ========= ========= =========
Net assets consist of:
Paid in capital $ 6,564 $ 5,701 $ 126,146 $ 19,000
Undistributed net investment
income (loss) (17) (6) 860 144
Unrealized appreciation (depreciation)
on investments 183 293 42,823 (238)
Unrealized depreciation on foreign
currency contracts and other
assets and liabilities -- -- -- --
Accumulated net realized gain (loss) 414 (121) 5,694 30
--------- --------- --------- ---------
Net assets $ 7,144 $ 5,867 $ 175,523 $ 18,936
========= ========= ========= =========
Shares of capital stock outstanding 654 570 10,219 1,904
========= ========= ========= =========
Net asset value per share $ 10.93 $ 10.30 $ 17.18 $ 9.94
========= ========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
56 and 57
<PAGE>
FREMONT MUTUAL FUNDS, INC.
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES (CONT.)
(All numbers in thousands except net asset value per share)
<TABLE>
<CAPTION>
California
Intermediate
Bond Money Market Tax-Free
Fund Fund Fund
-------------------------------------------
Assets:
<S> <C> <C> <C>
Investments in securities at cost $ 146,607 $ 501,261 $ 61,624
========= ========= =========
Investments in securities
at value (Note 1) 148,259 501,261 64,209
Cash 773 500 1,088
Dividends and interest receivable 1,127 576 830
Receivable for securities sold 9,669 -- --
Receivable from sale of fund shares 17 314 29
Variation margin receivable 350 -- --
Unrealized appreciation on foreign
currency contracts (Note 1) 54 -- --
Prepaid expense 1 32 1
--------- --------- ---------
Total assets 160,250 502,683 66,157
--------- --------- ---------
Liabilities:
Dividends payable to shareholders 13 7 12
Reverse repurchase agreement (Note 1) 5,508 -- --
Payable for securities purchased 39,927 4,953 --
Payable for fund shares redeemed 739 11,909 1
Accrued expenses:
Investment advisory, administrative
and distribution fees 44 82 17
Other 21 104 33
--------- --------- ---------
Total liabilities 46,252 17,055 63
--------- --------- ---------
Net assets $ 113,998 $ 485,628 $ 66,094
========= ========= =========
Net assets consist of:
Paid in capital $ 111,294 $ 485,628 $ 63,497
Undistributed net investment income 120 -- --
Unrealized appreciation on investments 1,757 -- 2,586
Unrealized appreciation on foreign
currency contracts and other
assets and liabilities 117 -- --
Accumulated net realized gain 710 -- 11
--------- --------- ---------
Net assets $ 113,998 $ 485,628 $ 66,094
========= ========= =========
Shares of capital stock outstanding 11,236 485,628 6,028
========= ========= =========
Net asset value per share $ 10.15 $ 1.00 $ 10.97
========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
58
<PAGE>
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59
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Six Months Ended April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
(All numbers in thousands)
<TABLE>
<CAPTION>
International International Emerging U.S.
Global Growth Small Cap Markets Micro-Cap
Fund Fund Fund Fund Fund
---------------------------------------------------------------------
Investment Income:
<S> <C> <C> <C> <C> <C>
Interest $ 7,748 $ 210 $ 24 $ 78 $ 600
Dividends 3,525 237 67 116 32
--------- --------- --------- --------- ---------
Total income* 11,273 447 91 194 632
--------- --------- --------- --------- ---------
Expenses:
Investment advisory and
administrative fees (Note 2) 2,526 266 48 85 1,567
Shareholder servicing fees 71 5 5 16 --
Custody fees 81 6 3 14 --
Distribution fees (Note 2) -- 18 3 19 --
Accounting fees 83 3 5 8 --
Audit and legal fees 21 3 3 9 --
Directors' fees (Note 2) 3 1 1 3 --
Registration fees 29 1 -- 9 --
Other 33 3 3 4 --
--------- --------- --------- --------- ---------
Total expenses before reductions 2,847 306 71 167 1,567
Expenses waived and/or reimbursed
by Advisor (Note 2) -- (15) (22) (56) --
--------- --------- --------- --------- ---------
Total net expenses 2,847 291 49 111 1,567
--------- --------- --------- --------- ---------
Net investment income (loss) 8,426 156 42 83 (935)
--------- --------- --------- --------- ---------
Realized and unrealized gain (loss) from
investments and foreign currency:
Net realized gain (loss) from:
Investments 13,428 3,506 (2,071) (951) 23,402
Foreign currency transactions (435) 116 (42) (142) --
Net unrealized appreciation (depreciation) on:
Investments 46,404 414 1,718 1,484 (12,124)
Translation of assets and liabilities
in foreign currencies 892 (9) (4) 8 --
--------- --------- --------- --------- ---------
Net realized and unrealized gain
(loss) from investments
and foreign currency 60,289 4,027 (399) 399 11,278
--------- --------- --------- --------- ---------
Net increase (decrease) in net
assets resulting from operations $ 68,715 $ 4,183 $ (357) $ 482 $ 10,343
========= ========= ========= ========= =========
<CAPTION>
U.S. Real Estate
Small Cap Select Growth Securities
Fund Fund# Fund Fund#
-----------------------------------------------------
Investment Income:
<S> <C> <C> <C> <C>
Interest $ 27 $ 15 $ 221 $ 37
Dividends 1 3 1,466 125
--------- --------- --------- ---------
Total income* 28 18 1,687 162
--------- --------- --------- ---------
Expenses:
Investment advisory and
administrative fees (Note 2) 35 17 519 35
Shareholder servicing fees 15 10 65 10
Custody fees 6 4 14 4
Distribution fees (Note 2) 8 4 -- 9
Accounting fees 6 4 21 4
Audit and legal fees 8 5 13 5
Directors' fees (Note 2) 3 2 2 2
Registration fees 8 5 8 7
Other 3 3 17 4
--------- --------- --------- ---------
Total expenses before reductions 92 54 659 80
Expenses waived and/or reimbursed
by Advisor (Note 2) (47) (30) -- (62)
--------- --------- --------- ---------
Total net expenses 45 24 659 18
--------- --------- --------- ---------
Net investment income (loss) (17) (6) 1,028 144
--------- --------- --------- ---------
Realized and unrealized gain (loss) from
investments and foreign currency:
Net realized gain (loss) from:
Investments 414 (121) 5,547 30
Foreign currency transactions -- -- --
Net unrealized appreciation (depreciation) on:
Investments 430 293 19,212 (238)
Translation of assets and liabilities
in foreign currencies -- -- -- --
--------- --------- --------- ---------
Net realized and unrealized gain
(loss) from investments
and foreign currency 844 172 24,759 (208)
--------- --------- --------- ---------
Net increase (decrease) in net
assets resulting from operations $ 827 $ 166 $ 25,787 $ (64)
========= ========= ========= =========
</TABLE>
*Net of foreign taxes withheld of $73 for the Global Fund, $27 for the
International Growth Fund, $7 for the International Small Cap Fund and $5 for
the Emerging Markets Fund.
#Period from December 31, 1997 (commencement of operations) to April 30, 1998.
The accompanying notes are an integral part of these financial statements.
60 and 61
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Six Months Ended April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS (CONT.)
(All numbers in thousands)
<TABLE>
<CAPTION>
California
Intermediate
Bond Money Market Tax-Free
Fund Fund Fund
---------------------------------------
Investment Income:
<S> <C> <C> <C>
Interest $ 3,699 $ 13,292 $ 1,631
Dividends 18 -- --
--------- --------- ---------
Total income* 3,717 13,292 1,631
--------- --------- ---------
Expenses:
Investment advisory and
administrative fees (Note 2) 310 845 164
Shareholder servicing fees 26 51 14
Custody fees 11 21 4
Accounting fees 18 48 16
Audit and legal fees 13 13 13
Directors' fees (Note 2) 2 3 2
Registration fees 9 36 2
Interest expense (Note 1) 2 -- --
Other -- 37 3
--------- --------- ---------
Total expenses before reductions 391 1,054 218
Expenses waived by Advisor (Note 2) (74) (351) (65)
--------- --------- ---------
Total net expenses 317 703 153
--------- --------- ---------
Net investment income 3,400 12,589 1,478
--------- --------- ---------
Realized and unrealized gain (loss) from
investments and foreign currency:
Net realized gain from:
Investments 967 -- 11
Transactions in written options 42 -- --
Foreign currency transactions 124 -- --
Net unrealized appreciation (depreciation) on:
Investments (1,270) -- (157)
Translation of assets and liabilities
in foreign currencies 129 -- --
--------- --------- ---------
Net realized and unrealized loss from
investments and foreign currency (8) -- (146)
--------- --------- ---------
Net increase in net assets
resulting from operations $ 3,392 $ 12,589 $ 1,332
========= ========= =========
</TABLE>
*Net of foreign taxes withheld of $3 for the Bond Fund.
The accompanying notes are an integral part of these financial statements.
62
<PAGE>
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63
<PAGE>
FREMONT MUTUAL FUNDS, INC.
April 30, 1998
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS For the Six Months Ended April 30, 1998
(Unaudited) and the Year Ended October 31, 1997 (All numbers in thousands)
<TABLE>
<CAPTION>
Global International Growth International Small Cap
Fund Fund Fund
---------------------- ---------------------- ----------------------
4/30/98 10/31/97 4/30/98 10/31/97 4/30/98 10/31/97
--------- --------- --------- --------- --------- ---------
Increase (decrease) in net assets:
From operations:
<S> <C> <C> <C> <C> <C> <C>
Net investment income (loss) $ 8,426 $ 17,055 $ 156 $ 139 $ 42 $ 195
Net realized gain (loss)
from investments and transactions
in written options 13,428 26,415 3,506 390 (2,071) 107
Net realized gain (loss) from
foreign currency transactions (435) 7,073 116 (356) (42) (4)
Net unrealized appreciation
(depreciation) on investments 46,404 26,358 414 (193) 1,718 (1,782)
Net unrealized appreciation (depreciation)
on translation of assets and
liabilities in foreign currencies 892 (1,161) (9) (1) (4) 2
--------- --------- --------- --------- --------- ---------
Net increase (decrease) in net
assets from operations 68,715 75,740 4,183 (21) (357) (1,482)
--------- --------- --------- --------- --------- ---------
Distributions to shareholders from:
Net investment income (9,078) (22,567) -- -- (210) (212)
Net realized gains (10,649) (86,397) (391) (103) (77) (257)
--------- --------- --------- --------- --------- ---------
Total distributions to shareholders (19,727) (108,964) (391) (103) (287) (469)
--------- --------- --------- --------- --------- ---------
From capital share transactions:
Proceeds from shares sold 187,490 381,253 16,767 18,693 4,669 4,033
Payments for shares redeemed (205,405) (360,553) (13,288) (15,302) (6,088) (3,192)
Reinvested dividends 19,264 106,121 389 103 266 430
--------- --------- --------- --------- --------- ---------
Net increase (decrease) in net assets
from capital share transactions 1,349 126,821 3,868 3,494 (1,153) 1,271
--------- --------- --------- --------- --------- ---------
Net increase (decrease) in net assets 50,337 93,597 7,660 3,370 (1,797) (680)
Net assets at beginning of period 665,747 572,150 38,643 35,273 8,534 9,214
--------- --------- --------- --------- --------- ---------
Net assets at end of period $ 716,084 $ 665,747 $ 46,303 $ 38,643 $ 6,737 $ 8,534
========= ========= ========= ========= ========= =========
Undistributed net investment income (loss)
included in net assets, end of period $ 1,800 $ 2,452 $ 106 $ (50) $ (162) $ 6
========= ========= ========= ========= ========= =========
Capital transactions in shares:
Sold 13,205 25,640 1,524 1,654 628 401
Redeemed (14,412) (24,185) (1,237) (1,330) (847) (319)
Reinvested dividends 1,358 7,698 40 9 38 47
--------- --------- --------- --------- --------- ---------
Net increase (decrease) from
capital share transactions 151 9,153 327 333 (181) 129
========= ========= ========= ========= ========= =========
<CAPTION>
Emerging Markets U.S. Micro-Cap U.S. Small Cap
Fund Fund Fund
---------------------- ---------------------- ----------------------
4/30/98 10/31/97 4/30/98 10/31/97 4/30/98 10/31/97*
--------- --------- --------- --------- --------- ---------
Increase (decrease) in net assets:
From operations:
Net investment income (loss) $ 83 $ 199 $ (935) $ (1,081) $ (17) $ 10
Net realized gain (loss)
from investments and transactions
in written options (951) 1,568 23,402 20,401 414 5
Net realized gain (loss) from
foreign currency transactions (142) (189) -- -- -- --
Net unrealized appreciation
(depreciation) on investments 1,484 (1,352) (12,124) 11,176 430 (247)
Net unrealized appreciation (depreciation)
on translation of assets and
liabilities in foreign currencies 8 (9) -- -- -- --
--------- --------- --------- --------- --------- ---------
Net increase (decrease) in net
assets from operations 482 217 10,343 30,496 827 (232)
--------- --------- --------- --------- --------- ---------
Distributions to shareholders from:
Net investment income -- (24) -- -- (2) (8)
Net realized gains (178) (1,322) (8,530) (16,002) -- (5)
--------- --------- --------- --------- --------- ---------
Total distributions to shareholders (178) (1,346) (8,530) (16,002) (2) (13)
--------- --------- --------- --------- --------- ---------
From capital share transactions:
Proceeds from shares sold 8,755 19,897 129,046 410,139 2,063 5,582
Payments for shares redeemed (3,627) (11,691) (128,646) (369,757) (1,096) --
Reinvested dividends 178 1,326 7,394 14,150 2 13
--------- --------- --------- --------- --------- ---------
Net increase (decrease) in net assets
from capital share transactions 5,306 9,532 7,794 54,532 969 5,595
--------- --------- --------- --------- --------- ---------
Net increase (decrease) in net assets 5,610 8,403 9,607 69,026 1,794 5,350
Net assets at beginning of period 12,175 3,772 171,507 102,481 5,350 --
--------- --------- --------- --------- --------- ---------
Net assets at end of period $ 17,785 $ 12,175 $ 181,114 $ 171,507 $ 7,144 $ 5,350
========= ========= ========= ========= ========= =========
Undistributed net investment income (loss)
included in net assets, end of period $ 83 $ -- $ (935) $ -- $ (17) $ 2
========= ========= ========= ========= ========= =========
Capital transactions in shares:
Sold 937 1,730 6,229 18,493 200 558
Redeemed (385) (990) (6,064) (16,801) (105) --
Reinvested dividends 19 139 375 644 -- 1
--------- --------- --------- --------- --------- ---------
Net increase (decrease) from
capital share transactions 571 879 540 2,336 95 559
========= ========= ========= ========= ========= =========
</TABLE>
* Period from September 24, 1997 (commencement of operations) to October 31,
1997.
The accompanying notes are an integral part of these financial statements.
64 and 65
<PAGE>
FREMONT MUTUAL FUNDS, INC.
April 30, 1998
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS For the Six Months Ended April 30, 1998
(Unaudited) and the Year Ended October 31, 1997 (All numbers in thousands)
<TABLE>
<CAPTION>
Real Estate
Select Growth Securities
Fund Fund Fund
--------- ---------------------- ---------
4/30/98# 4/30/98 10/31/97 4/30/98#
--------- --------- --------- ---------
Increase (decrease) in net assets:
From operations:
<S> <C> <C> <C> <C>
Net investment income (loss) $ (6) $ 1,028 $ 1,742 $ 144
Net realized gain (loss) from
investments and transactions
in written options (121) 5,547 8,013 30
Net realized gain from foreign
currency transactions -- -- -- --
Net unrealized appreciation
(depreciation) on investments 293 19,212 19,122 (238)
Net unrealized appreciation (depreciation)
on translation of assets and
liabilities in foreign currencies -- -- -- --
--------- --------- --------- ---------
Net increase (decrease) in net
assets from operations 166 25,787 28,877 (64)
--------- --------- --------- ---------
Distributions to shareholders from:
Net investment income -- (237) (1,783) --
Net realized gains -- (3,057) (22,466) --
--------- --------- --------- ---------
Total distributions to shareholders -- (3,294) (24,249) --
--------- --------- --------- ---------
From capital share transactions:
Proceeds from shares sold 5,702 61,029 100,616 20,458
Payments for shares redeemed (1) (58,886) (60,351) (1,458)
Reinvested dividends -- 3,246 24,124 --
--------- --------- --------- ---------
Net increase in net assets
from capital share transactions 5,701 5,389 64,389 19,000
--------- --------- --------- ---------
Net increase in net assets 5,867 27,882 69,017 18,936
Net assets at beginning of period -- 147,641 78,624 --
--------- --------- --------- ---------
Net assets at end of period $ 5,867 $ 175,523 $ 147,641 $ 18,936
========= ========= ========= =========
Undistributed net investment income (loss)
included in net assets, end of period $ (6) $ 860 $ 69 $ 143
========= ========= ========= =========
Capital transactions in shares:
Sold 570 3,833 7,058 2,050
Redeemed -- (3,694) (4,276) (146)
Reinvested dividends -- 212 1,851 --
--------- --------- --------- ---------
Net increase from
capital share transactions 570 351 4,633 1,904
========= ========= ========= =========
<CAPTION>
Bond Money Market California Intermediate
Fund Fund Tax-Free Fund
---------------------- ---------------------- ----------------------
4/30/98 10/31/97 4/30/98 10/31/97 4/30/98 10/31/97
--------- --------- --------- --------- --------- ---------
Increase (decrease) in net assets:
From operations:
<S> <C> <C> <C> <C> <C> <C>
Net investment income (loss) $ 3,400 $ 4,852 $ 12,589 $ 20,744 $ 1,478 $ 2,889
Net realized gain (loss) from
investments and transactions
in written options 1,009 1,268 -- -- 11 29
Net realized gain from foreign
currency transactions 124 458 -- -- -- --
Net unrealized appreciation
(depreciation) on investments (1,270) 713 -- -- (157) 1,043
Net unrealized appreciation (depreciation)
on translation of assets and
liabilities in foreign currencies 129 (199) -- -- -- --
--------- --------- --------- --------- --------- ---------
Net increase (decrease) in net
assets from operations 3,392 7,092 12,589 20,744 1,332 3,961
--------- --------- --------- --------- --------- ---------
Distributions to shareholders from:
Net investment income (3,478) (4,965) (12,589) (20,744) (1,478) (2,889)
Net realized gains (908) (173) -- -- (29) (45)
--------- --------- --------- --------- --------- ---------
Total distributions to shareholders (4,386) (5,138) (12,589) (20,744) (1,507) (2,934)
--------- --------- --------- --------- --------- ---------
From capital share transactions:
Proceeds from shares sold 61,594 38,603 599,047 872,518 2,463 15,727
Payments for shares redeemed (41,164) (25,784) (558,890) (789,399) (1,894) (6,190)
Reinvested dividends 4,260 4,952 12,319 20,381 1,391 2,589
--------- --------- --------- --------- --------- ---------
Net increase in net assets
from capital share transactions 24,690 17,771 52,476 103,500 1,960 12,126
--------- --------- --------- --------- --------- ---------
Net increase in net assets 23,696 19,725 52,476 103,500 1,785 13,153
Net assets at beginning of period 90,302 70,577 433,152 329,652 64,309 51,156
--------- --------- --------- --------- --------- ---------
Net assets at end of period $ 113,998 $ 90,302 $ 485,628 $ 433,152 $ 66,094 $ 64,309
========= ========= ========= ========= ========= =========
Undistributed net investment income (loss)
included in net assets, end of period $ 119 $ 198 $ -- $ -- $ -- $ --
========= ========= ========= ========= ========= =========
Capital transactions in shares:
Sold 6,040 3,846 599,047 872,518 223 1,446
Redeemed (4,048) (2,580) (558,890) (789,399) (172) (568)
Reinvested dividends 420 495 12,319 20,381 126 238
--------- --------- --------- --------- --------- ---------
Net increase from
capital share transactions 2,412 1,761 52,476 103,500 177 1,116
========= ========= ========= ========= ========= =========
</TABLE>
# Period from December 31, 1997 (commencement of operations) to April 30, 1998.
The accompanying notes are an integral part of these financial statements.
66 and 67
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GLOBAL FUND
(Unaudited)
Six Months Year Ended October 31
Ended -----------------------------------------------------------------
April 30, 1998 1997 1996 1995 1994 1993
-------------- --------- --------- --------- --------- ---------
Selected Per Share Data
for one share outstanding during the period
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 14.16 $ 15.11 $ 14.24 $ 13.13 $ 13.17 $ 11.52
--------- --------- --------- --------- --------- ---------
Income from Investment Operations
Net investment income .18 .45 .39 .40 .26 .32
Net realized and unrealized gain (loss) 1.26 1.31 1.49 1.24 (.03) 1.67
--------- --------- --------- --------- --------- ---------
Total investment operations 1.44 1.76 1.88 1.64 .23 1.99
--------- --------- --------- --------- --------- ---------
Less Distributions
From net investment income (.19) (.52) (.44) (.50) (.14) (.26)
From net realized gains (.23) (2.19) (.57) (.03) (.13) (.08)
--------- --------- --------- --------- --------- ---------
Total distributions (.42) (2.71) (1.01) (.53) (.27) (.34)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period $ 15.18 $ 14.16 $ 15.11 $ 14.24 $ 13.13 $ 13.17
========= ========= ========= ========= ========= =========
Total Return 10.43% 13.01% 13.72% 12.78% 1.74% 17.51%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 716,084 $ 665,747 $ 572,150 $ 482,355 $ 453,623 $ 186,325
Ratio of expenses to average net assets .85%* .85% .87% .88% .95% .99%
Ratio of net investment income
to average net assets 2.52%* 2.66% 2.66% 2.98% 2.47% 2.89%
Portfolio turnover rate 46% 48% 71% 83% 52% 40%
Average commission rate paid 1 $ .0169 $ .0149 $ .0238 -- -- --
</TABLE>
1 Disclosure not required for years prior to 1996.
* Annualized
<TABLE>
<CAPTION>
INTERNATIONAL GROWTH FUND
(Unaudited)
Six Months Year Ended October 31 Period from
Ended ------------------------------------- 3/1/94 to
April 30, 1998 1997 1996 1995 10/31/94
-------------- --------- --------- --------- ---------
Selected Per Share Data
for one share outstanding during the period
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 10.37 $ 10.40 $ 9.72 $ 9.79 $ 9.57
--------- --------- --------- --------- ---------
Income from Investment Operations
Net investment income (loss) (.06) .02 (.02) .10 .02
Net realized and unrealized gain (loss) 1.23 (.02) .71 (.09) .20
--------- --------- --------- --------- ---------
Total investment operations 1.17 -- .69 .01 .22
--------- --------- --------- --------- ---------
Less Distributions
From net investment income -- -- (.01) (.08) --
From net realized gains (.11) (.03) -- -- --
--------- --------- --------- --------- ---------
Total distributions (.11) (.03) (.01) (.08) --
--------- --------- --------- --------- ---------
Net asset value, end of period $ 11.43 $ 10.37 $ 10.40 $ 9.72 $ 9.79
========= ========= ========= ========= =========
Total Return 11.42% 3 -0.01% 7.07% 0.13% 2.30%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 46,303 $ 38,643 $ 35,273 $ 32,156 $ 29,725
Ratio of net expenses to
average net assets 2 1.50%* 1.50% 1.50% 1.50% 1.50%*
Ratio of gross expenses to
average net assets 2 1.62%* -- -- -- --
Ratio of net investment income (loss)
to average net assets .74%* .34% -.20% 1.19% .35%*
Portfolio turnover rate 102% 95% 74% 32% 30%
Average commission rate paid 1 $ .0149 $ .0173 $ .0150 -- --
</TABLE>
1 Disclosure not required for years prior to 1996.
2 See Note 2 of "Notes to Financial Statements."
3 Total return would have been lower had the advisor not waived and/or
reimbursed expenses.
* Annualized
The accompanying notes are an integral part of these financial statements.
68
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL SMALL CAP FUND
(Unaudited)
Six Months Year Ended October Period from
Ended ------------------------------------- 6/30/94 to
April 30, 1998 1997 1996 1995 10/31/94
-------------- --------- --------- --------- ---------
Selected Per Share Data
for one share outstanding during the period
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 8.23 $ 10.15 $ 9.00 $ 9.86 $ 10.00
--------- --------- --------- --------- ---------
Income from Investment Operations
Net investment income (loss) .01 .14 .14 .10 (.01)
Net realized and unrealized gain (loss) (.08) (1.58) 1.08 (.88) (.13)
--------- --------- --------- --------- ---------
Total investment operations (.07) (1.44) 1.22 (.78) (.14)
--------- --------- --------- --------- ---------
Less Distributions
From net investment income (.21) (.21) (.07) (.08) --
From net realized gains (.08) (.27) -- -- --
--------- --------- --------- --------- ---------
Total distributions (.29) (.48) (.07) (.08) --
--------- --------- --------- --------- ---------
Net asset value, end of period $ 7.87 $ 8.23 $ 10.15 $ 9.00 $ 9.86
========= ========= ========= ========= =========
Total Return -.44% 3 -14.56% 13.69% 3 -7.96% 3 -1.40%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 6,737 $ 8,534 $ 9,214 $ 4,245 $ 1,768
Ratio of net expenses to
average net assets 2,4 1.50%* 1.50% 1.81% 2.06% 2.50%*
Ratio of gross expenses to
average net assets 2,4 2.13%* 1.50% 2.50% 2.50% 2.50%*
Ratio of net investment income (loss)
to average net assets .28%* 1.97% 1.61% 1.67% -0.28%*
Portfolio turnover rate 106% 56% 74% 96% --
Average commission rate paid 1 $ .0004 $ .0005 $ .0003 -- --
</TABLE>
1 Disclosure not required for years prior to 1996.
2 See Note 2 of "Notes to Financial Statements."
3 Total return would have been lower had the advisor not waived and/or
reimbursed expenses.
4 Management fees were voluntarily waived from February 1, 1995 to October 31,
1996.
* Annualized
<TABLE>
<CAPTION>
EMERGING MARKETS FUND
(Unaudited)
Six Months Year Period from
Ended Ended 6/24/96 to
April 30, 1998 10/31/97 10/31/96
-------------- --------- ---------
Selected Per Share Data
for one share outstanding during the period
<S> <C> <C> <C>
Net asset value, beginning of period $ 9.58 $ 9.62 $ 10.00
--------- --------- ---------
Income from Investment Operations
Net investment income .05 .17 .10
Net realized and unrealized gain (loss) .16 1.03 (.41)
--------- --------- ---------
Total investment operations .21 1.20 (.31)
--------- --------- ---------
Less Distributions
From net investment income -- (.06) (.07)
From net realized gains (.14) (1.18) --
--------- --------- ---------
Total distributions (.14) (1.24) (.07)
--------- --------- ---------
Net asset value, end of period $ 9.65 $ 9.58 $ 9.62
========= ========= =========
Total Return 3 2.25% 12.55% -3.12%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 17,785 $ 12,175 $ 3,772
Ratio of net expenses to
average net assets 2 1.50%* .26% --
Ratio of gross expenses to
average net assets 2 2.36%* 2.63% 4.95%*
Ratio of net investment income
to average net assets .41%* 2.04% 3.32%*
Portfolio turnover rate 63% 208% 7%
Average commission rate paid $ .0065 $ .0038 $ .0063
</TABLE>
2 See Note 2 of "Notes to Financial Statements."
3 Total return would have been lower had the advisor not waived and/or
reimbursed expenses.
* Annualized
The accompanying notes are an integral part of these financial statements.
69
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
U.S. MICRO-CAP FUND
(Unaudited)
Six Months Year Ended October 31 Period from
Ended ----------------------------------------- 6/30/94 to
April 30, 1998 1997 1996 1995 10/31/94
-------------- --------- --------- --------- ---------
Selected Per Share Data
for one share outstanding during the period
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 22.69 $ 19.63 $ 14.34 $ 10.34 $ 10.00
--------- --------- --------- --------- ---------
Income from Investment Operations
Net investment income (loss) (.12) (.10) (.04) (.05) .02
Net realized and unrealized gain 1.03 5.60 5.83 4.05 .34
--------- --------- --------- --------- ---------
Total investment operations .91 5.50 5.79 4.00 .36
--------- --------- --------- --------- ---------
Less Distributions
From net investment income -- -- -- -- (.02)
From net realized gains (1.24) (2.44) (.50) -- --
--------- --------- --------- --------- ---------
Total distributions (1.24) (2.44) (.50) -- (.02)
--------- --------- --------- --------- ---------
Net asset value, end of period $ 22.36 $ 22.69 $ 19.63 $ 14.34 $ 10.34
========= ========= ========= ========= =========
Total Return 4.75% 28.80% 3 41.46% 3 38.68% 3 3.60%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 181,114 $ 171,507 $ 102,481 $ 7,792 $ 2,052
Ratio of net expenses to
average net assets 4 1.89%* 1.88% 1.96% 2.04% 2.50%*
Ratio of gross expenses to
average net assets 4 1.89%* 1.90% 2.22% 2.50% 2.50%*
Ratio of net investment income (loss)
to average net assets -1.13%* -.67% -.51% -.67% .68%*
Portfolio turnover rate 91% 125% 81% 144% 44%
Average commission rate paid 1 $ .0525 $ .0505 $ .0541 -- --
</TABLE>
1 Disclosure not required for years prior to 1996.
3 Total return would have been lower had the advisor not waived expenses.
4 Management fees were voluntarily waived from February 1, 1995 to January 8,
1997.
* Annualized
U.S. SMALL CAP FUND
(Unaudited)
Six Months Period from
Ended 9/24/97 to
April 30, 1998 10/31/97
-------------- ---------
Selected Per Share Data
for one share outstanding during the period
Net asset value, beginning of period $ 9.57 $ 10.00
--------- ---------
Income from Investment Operations
Net investment income (loss) (.03) .02
Net realized and unrealized gain (loss) 1.39 (.42)
--------- ---------
Total investment operations 1.36 (.40)
--------- ---------
Less Distributions
From net investment income -- (.02)
From net realized gains -- (.01)
--------- ---------
Total distributions -- (.03)
--------- ---------
Net asset value, end of period $ 10.93 $ 9.57
========= =========
Total Return 3 14.25% -4.06%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 7,144 $ 5,350
Ratio of net expenses to
average net assets 2 1.50%* 1.50%*
Ratio of gross expenses to
average net assets 2 3.17%* 3.32%*
Ratio of net investment income (loss)
to average net assets -.57%* 1.81%*
Portfolio turnover rate 138% 8%
Average commission rate paid $ .0526 $ .0543
2 See Note 2 of "Notes to Financial Statements."
3 Total return would have been lower had the advisor not waived and/or
reimbursed expenses.
* Annualized
The accompanying notes are an integral part of these financial statements.
70
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1998
- --------------------------------------------------------------------------------
SELECT FUND
(Unaudited)
Period from
12/31/97 to
April 30, 1998
--------------
Selected Per Share Data
for one share outstanding during the period
Net asset value, beginning of period $ 9.93
---------
Income from Investment Operations
Net investment loss (.01)
Net realized and unrealized gain .38
---------
Total investment operations .37
---------
Less Distributions
From net investment income --
From net realized gains --
---------
Total distributions --
---------
Net asset value, end of period $ 10.30
=========
Total Return 3 3.73%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 5,867
Ratio of net expenses to
average net assets 2 1.40%*
Ratio of gross expenses to
average net assets 2 3.26%*
Ratio of net investment loss
to average net assets -.37%*
Portfolio turnover rate 54%
Average commission rate paid $ .0586
2 See Note 2 of "Notes to Financial Statements."
3 Total return would have been lower had the advisor not waived and/or
reimbursed expenses.
* Annualized
<TABLE>
<CAPTION>
GROWTH FUND
(Unaudited)
Six Months Year Ended October 31
Ended -----------------------------------------------------------------
April 30, 1998 1997 1996 1995 1994 1993
-------------- --------- --------- --------- --------- ---------
Selected Per Share Data
for one share outstanding during the period
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 14.96 $ 15.02 $ 13.06 $ 10.46 $ 11.25 $ 10.08
--------- --------- --------- --------- --------- ---------
Income from Investment Operations
Net investment income .10 .20 .10 .13 .21 .13
Net realized and unrealized gain (loss) 2.44 3.43 2.65 2.74 (.02) 1.16
--------- --------- --------- --------- --------- ---------
Total investment operations 2.54 3.63 2.75 2.87 .19 1.29
--------- --------- --------- --------- --------- ---------
Less Distributions
From net investment income (.02) (.22) (.08) (.17) (.18) (.12)
From net realized gains (.30) (3.47) (.71) (.10) (.80) --
--------- --------- --------- --------- --------- ---------
Total distributions (.32) (3.69) (.79) (.27) (.98) (.12)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period $ 17.18 $ 14.96 $ 15.02 $ 13.06 $ 10.46 $ 11.25
========= ========= ========= ========= ========= =========
Total Return 17.29% 29.26% 22.06% 28.12% 3 1.72% 3 12.80% 3
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 175,523 $ 147,641 $ 78,624 $ 59,632 $ 27,244 $ 42,306
Ratio of net expenses to
average net assets 4 .82%* .85% .92% .97% .94% .87%
Ratio of gross expenses to
average net assets 4 .82%* .85% .92% 1.01% 1.08% 1.02%
Ratio of net investment income
to average net assets 1.29%* 1.44% .75% 1.02% 1.31% 1.19%
Portfolio turnover rate 25% 48% 129% 108% 55% 44%
Average commission rate paid 1 $ .0467 $ .0467 $ .0429 -- -- --
</TABLE>
1 Disclosure not required for years prior to 1996.
3 Total return would have been lower had the advisor not waived expenses.
4 Administrative fees were voluntarily waived from August 14, 1992 to March 31,
1995.
* Annualized
The accompanying notes are an integral part of these financial statements.
71
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1998
- --------------------------------------------------------------------------------
REAL ESTATE SECURITIES FUND
(Unaudited)
Six Months
Ended
April 30, 1998
--------------
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 .08
Net realized and unrealized gain (.14)
---------
Total investment operations (.06)
---------
Less Distributions
From net investment income --
From net realized gains --
---------
Total distributions --
---------
Net asset value, end of period $ 9.94
=========
Total Return 3 -0.60%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 18,936
Ratio of net expenses to average net assets 2 .50%*
Ratio of gross expenses to average net assets 2 2.44%*
Ratio of net investment income to average net assets 3.99%*
Portfolio turnover rate 57%
Average commission rate paid $ .0592
2 See Note 2 of "Notes to Financial Statements."
3 Total return would have been lower had the advisor not waived and/or
reimbursed expenses.
* Annualized
<TABLE>
<CAPTION>
BOND FUND
(Unaudited)
Six Months Year Ended October 31 Period from
Ended --------------------------------------------------- 4/30/93 to
April 30, 1998 1997 1996 1995 1994 10/31/93
-------------- --------- --------- --------- --------- ---------
Selected Per Share Data
for one share outstanding during the period
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 10.23 $ 9.99 $ 10.13 $ 9.29 $ 10.27 $ 10.04
--------- --------- --------- --------- --------- ---------
Income from Investment Operations
Net investment income .30 .67 .67 .65 .53 .27
Net realized and unrealized gain (loss) .02 .25 .11 .83 (.98) .24
--------- --------- --------- --------- --------- ---------
Total investment operations .32 .92 .78 1.48 (.45) .51
--------- --------- --------- --------- --------- ---------
Less Distributions
From net investment income (.31) (.66) (.70) (.64) (.53) (.27)
From net realized gains (.09) (.02) (.22) -- -- (.01)
--------- --------- --------- --------- --------- ---------
Total distributions (.40) (.68) (.92) (.64) (.53) (.28)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period $ 10.15 $ 10.23 $ 9.99 $ 10.13 $ 9.29 $ 10.27
========= ========= ========= ========= ========= =========
Total Return 3 3.24% 9.54% 8.18% 16.49% -4.42% 5.15%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 113,998 $ 90,302 $ 70,577 $ 86,343 $ 64,244 $ 11,738
Ratio of net expenses to
average net assets 2 .56%* .61% .68% .60% .66% .50%*
Ratio of gross expenses to
average net assets 2 .69%* .76% .83% .75% 1.04% 1.23%*
Ratio of net investment income
to average net assets 5.85%* 6.40% 6.82% 6.69% 5.76% 5.35%*
Portfolio turnover rate 119% 191% 154% 21% 205% 7%
</TABLE>
2 See Note 2 of "Notes to Financial Statements."
3 Total return would have been lower had the advisor not waived expenses.
* Annualized
The accompanying notes are an integral part of these financial statements.
72
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Financial Highlights - April 30, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MONEY MARKET FUND
(Unaudited)
Six Months Year Ended October 31
Ended -----------------------------------------------------------------
April 30, 1998 1997 1996 1995 1994 1993
-------------- --------- --------- --------- --------- ---------
Selected Per Share Data
for one share outstanding during the period
<S> <C> <C> <C> <C> <C> <C>
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 .03 .05 .05 .06 .03 .03
--------- --------- --------- --------- --------- ---------
Total investment operations .03 .05 .05 .06 .03 .03
--------- --------- --------- --------- --------- ---------
Less Distributions
From net investment income (.03) (.05) (.05) (.06) (.03) (.03)
--------- --------- --------- --------- --------- ---------
Total distributions (.03) (.05) (.05) (.06) (.03) (.03)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========= ========= ========= ========= ========= =========
Total Return 3 2.69% 5.39% 5.34% 5.84% 3.49% 2.66%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 485,628 $ 433,152 $ 329,652 $ 299,312 $ 224,439 $ 24,207
Ratio of net expenses to
average net assets 2 .30%* .30% .31% .30% .46% .67%
Ratio of gross expenses to
average net assets 2 .45%* .45% .46% .45% .61% .82%
Ratio of net investment income
to average net assets 5.39% 5.26% 5.22% 5.70% 4.02% 2.62%
</TABLE>
2 See Note 2 of "Notes to Financial Statements."
3 Total return would have been lower had the advisor not waived expenses.
* Annualized
<TABLE>
<CAPTION>
CALIFORNIA INTERMEDIATE
TAX-FREE FUND
(Unaudited)
Six Months Year Ended October 31
Ended -----------------------------------------------------------------
April 30, 1998 1997 1996 1995 1994 1993
-------------- --------- --------- --------- --------- ---------
Selected Per Share Data
for one share outstanding during the period
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 10.99 $ 10.80 $ 10.86 $ 10.13 $ 11.10 $ 10.55
--------- --------- --------- --------- --------- ---------
Income from Investment Operations
Net investment income .25 .51 .52 .53 .53 .55
Net realized and unrealized gain (loss) (.02) .20 (.03) .73 (.97) .62
--------- --------- --------- --------- --------- ---------
Total investment operations .23 .71 .49 1.26 (.44) 1.17
--------- --------- --------- --------- --------- ---------
Less Distributions
From net investment income (.25) (.51) (.52) (.53) (.53) (.55)
From net realized gains -- (.01) (.03) -- -- (.07)
--------- --------- --------- --------- --------- ---------
Total distributions (.25) (.52) (.55) (.53) (.53) (.62)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period $ 10.97 $ 10.99 $ 10.80 $ 10.86 $ 10.13 $ 11.10
========= ========= ========= ========= ========= =========
Total Return 3 2.15% 6.75% 4.63% 12.77% -3.94% 11.37%
Ratios and Supplemental Data
Net assets, end of period (000s omitted) $ 66,094 $ 64,309 $ 51,156 $ 50,313 $ 58,305 $ 59,716
Ratio of net expenses to
average net assets 2 .48%* .49% .51% .50% .51% .50%
Ratio of gross expenses to
average net assets 2 .68%* .69% .73% .72% .71% .71%
Ratio of net investment income
to average net assets 4.59%* 4.72% 4.86% 5.08% 4.94% 5.05%
Portfolio turnover rate 2% 6% 6% 18% 21% 26%
</TABLE>
2 See Note 2 of "Notes to Financial Statements."
3 Total return would have been lower had the advisor not waived expenses.
* Annualized
The accompanying notes are an integral part of these financial statements.
73
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
Fremont Mutual Funds, Inc. (the "Investment Company") is an open-end
investment company authorized to issue ten billion shares of $.0001 par value
capital stock. These shares are currently offered in thirteen series, twelve
of which are covered by this report:
o the GLOBAL FUND
o the INTERNATIONAL GROWTH FUND
o the INTERNATIONAL SMALL CAP FUND
o the EMERGING MARKETS FUND
o the U.S. MICRO-CAP FUND
o the U.S. SMALL CAP FUND
o the SELECT FUND
o the GROWTH FUND
o the REAL ESTATE SECURITIES FUND
o the BOND FUND
o the MONEY MARKET FUND
o the CALIFORNIA INTERMEDIATE TAX-FREE FUND (the 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 in conformity with
generally accepted accounting principles for investment companies and are
summarized below.
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 closing values of such securities on
their respective exchanges or the most recent price where no closing value
is available.
Securities in the 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 Global Fund, the International
Growth Fund, the International Small Cap Fund and the 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, as
amended. The Investment Company accounts for the assets of each Fund
separately and allocates general expenses of the Investment Company 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. Distributions
to shareholders are recorded on the ex-dividend date.
Dividends received by the Real Estate Securities Fund from its securities
may be a return of capital. Such distributions reduce the cost basis of
the securities, and any distributions in excess of the cost basis are
recognized as capital gains.
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 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
74
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
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.
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 Global Fund, the International Growth Fund,
the International Small Cap Fund, the Emerging Markets Fund and the 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 Global Fund, the International Growth Fund and the 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. When required, the
Funds will segregate assets in an amount sufficient to cover obligations
under the hedge 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.
75
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
At April 30, 1998, the underlying values for open foreign currency
contracts were as follows:
<TABLE>
<CAPTION>
Net Unrealized
To Receive Foreign Settlement Initial Appreciation
(To Deliver) Currency Date Value Current Value (Depreciation)
------------ -------- ---- ----- ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Global Fund (18,000,000) Australian Dollar 05/12/98 $ (12,276,000) $ (11,696,940) $ 579,060
(1,800,000) Australian Dollar 05/12/98 (1,164,852) (1,169,694) (4,842)
(14,500,000) British Pound 05/12/98 (26,432,000) (24,213,550) (781,550)
(18,500,000) Canadian Dollar 05/12/98 (12,962,444) (12,937,968) 24,476
(72,000,000) German Deutschemark 05/12/98 (39,904,672) (40,120,361) (215,689)
(6,400,000) German Deutschemark 05/12/98 (3,534,935) (3,566,254) (31,319)
(6,000,000) German Deutschemark 05/12/98 (3,293,085) (3,343,364) (50,279)
(6,400,000) German Deutschemark 05/12/98 (3,457,217) (3,566,254) (109,037)
(13,000,000) German Deutschemark 05/12/98 (7,021,334) (7,243,954) (222,620)
1,400,000 Irish Punt 05/12/98 1,974,000 1,964,480 (9,520)
3,100,000 Irish Punt 05/12/98 4,385,570 4,349,920 (35,650)
(4,500,000) Irish Punt 05/12/98 (6,210,000) (6,314,400) (104,400)
(41,000,000) Swedish Krona 05/12/98 (5,055,487) (5,294,353) (238,866)
-----------
$(1,200,236)
===========
Int. Growth Fund 20,720 British Pound 05/01/98 $ 34,592 $ 34,654 $ 62
21,555 British Pound 05/05/98 36,002 36,052 50
13,696 British Pound 05/06/98 22,830 22,906 76
(69,844) British Pound 07/30/98 (116,000) (116,374) (374)
40,389 Canadian Dollar 05/04/98 28,234 28,227 (7)
(62,238) Dutch Guilder 07/07/98 (30,000) (30,918) (918)
(263,177) Finnish Markka 07/07/98 (47,000) (48,545) (1,545)
(253,208) French Franc 07/07/98 (41,000) (42,241) (1,241)
(302,345) French Franc 07/07/98 (49,000) (50,439) (1,439)
(49,826) German Deutschemark 07/07/98 (27,000) (27,843) (843)
2,604,527 Japanese Yen 05/07/98 19,638 19,596 (42)
(15,454,200) Japanese Yen 06/25/98 (120,000) (117,175) 2,825
(36,516,200) Japanese Yen 07/30/98 (280,000) (278,282) 1,718
(17,879,400) Japanese Yen 10/28/98 (140,000) (138,076) 1,924
(8,969,800) Japanese Yen 04/08/99 (70,000) (70,340) (340)
(2,185,620) Spanish Peseta 05/05/98 (14,321) (14,331) (10)
(11,424,500) Spanish Peseta 07/07/98 (73,000) (75,176) (2,176)
(219,864) Swiss Franc 07/07/98 (145,000) (147,609) (2,609)
(100,036) Swiss Franc 07/07/98 (66,000) (67,161) (1,161)
-----------
$ (6,050)
===========
Bond Fund (1,611,000) New Zealand Dollar 05/05/98 $ (945,464) $ (891,286) $ 54,178
-----------
$ 54,178
===========
</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 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. The Funds use futures contracts to generate current
income or to reduce principal volatility.
76
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
At April 30, 1998, the open futures contracts were as follows:
Net Unrealized
Contracts Expiration Appreciation
To Buy Date (Depreciation)
------ ---- --------------
Growth Fund
S&P 500 Index 4 Jun 98 $ 7,560
-----------
$ 7,560
===========
Bond Fund
10-yr. U.S. Treasury Note 69 Jun 98 $ 27,492
10-yr. U.S. Treasury Note 25 Jun 98 11,523
30-yr. U.S. Treasury Bond 50 Jun 98 60,937
30-yr. U.S. Treasury Bond 40 Jun 98 29,688
30-yr. U.S. Treasury Bond 3 Jun 98 (1,875)
30-yr. U.S. Treasury Bond 30 Jun 98 (17,813)
30-yr. U.S. Treasury Bond 60 Jun 98 1,876
United Kingdom 90-day LIBOR 100 Jun 98 (6,306)
-----------
$ 105,522
===========
At April 30, 1998, $325,000 and $695,000 par value of U.S. Treasury Bills
for the Growth Fund and Bond Fund, respectively, were held by brokers to
satisfy the initial margin requirements related to these contracts.
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 331 1/43% 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 which
is included in interest income. For the six months ended April 30, 1998,
transactions in securities lending resulted in fee income to the Global
Fund, the International Growth Fund, the International Small Cap Fund, the
Emerging Markets Fund, the U.S. Micro-Cap Fund and the Growth Fund of
$76,532, $5,451, $2,915, $618, $33,312, and $9,206, respectively.
The market value of the securities on loan and the collateral balance held
by the Funds as of April 30, 1998 were as follows:
Market Value Collateral Value
------------ ----------------
Global Fund $ 42,746,086 $ 43,618,713
Emerging Markets Fund 353,783 368,571
U.S. Micro-Cap Fund 31,810,659 32,423,670
Growth Fund 13,515,137 13,686,639
J. Reverse Repurchase Agreements
During the six months ended April 30, 1998, the 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. At April 30, 1998, outstanding reverse
repurchase agreements for the Bond Fund, which were collateralized by
mortgage-backed securities issued by the Government National Mortgage
Association, were as follows:
<TABLE>
<CAPTION>
Amount of
Reverse Repurchase Interest Maturity Cost of Value of
Counterparty Agreements Rate Date Collateral Collateral
------------ ---------- ---- ---- ---------- ----------
<S> <C> <C> <C> <C> <C>
Credit Suisse First Boston Corp. $5,508,000 5.580% 07/21/98 $5,632,249 $5,709,666
</TABLE>
77
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
Investment Advisor
The Funds each have entered into an investment management and
administrative services agreement with Fremont Investment Advisors, Inc.
(the "Advisor"), a majority-owned subsidiary of Fremont Investors, Inc.
Under this agreement, 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>
Global Fund 0.60% on all net assets 0.15% on all net assets
International Growth Fund* 1.00% on all net assets 0.15% on all net assets
International Small Cap Fund* 1.25% on all net assets 0.15% on all net assets
Emerging Markets Fund* 1.00% on all net assets 0.15% on all net assets
U.S. Micro-Cap Fund 2.50% on first $30 million --
2.00% on next $70 million --
1.50% on balance over $100 million --
U.S. Small Cap Fund* 1.00% on all net assets 0.15% on all net assets
Select Fund* 1.00% on all net assets --
Growth Fund0.50% on all net assets 0.15% on all net assets
Real Estate Securities Fund* 1.00% on all net assets --
Bond Fund* 0.40% on all net assets 0.15% on all net assets
Money Market Fund* 0.30% on first $50 million 0.15% on all net assets
0.20% on balance over $50 million --
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. The waivers are voluntary and they may be changed in the
future. For the Emerging Markets Fund, the Bond Fund, the Money Market
Fund and the California Intermediate Tax-Free Fund, all fees waived in the
past cannot be recouped in the future.
For the International Growth Fund, the International Small Cap Fund, the
U.S. Small Cap Fund, the Select Fund and the Real Estate Securities Fund,
to the extent management fees are waived and/or other expenses are
reimbursed by the Advisor, a Fund may reimburse the Advisor for any
reductions in the Fund's expenses during the three years following that
reduction if such reimbursement is requested by the Advisor, if such
reimbursement can be achieved within the foregoing expense limit, and if
the Board of Directors approves the reimbursement at the time of the
request as not inconsistent with the best interests of the Fund.
For the International Growth Fund and the International Small Cap Fund,
the Advisor has voluntarily limited the total operating expenses to 1.50%
of average net assets beginning on March 2, 1998. Prior to March 2, 1998,
the Advisor received a single management fee (i.e., a unitary fee) from
these Funds. For the two months ended April 30, 1998, the Advisor
reimbursed expenses of $14,569 and $22,252, respectively, for the
International Growth Fund and the International Small Cap Fund.
For the Emerging Markets Fund and the U.S. Small Cap Fund, the Advisor has
voluntarily limited the total operating expenses to 1.50% of average net
assets. For the six months ended April 30, 1998, the Advisor reimbursed
expenses of $56,086 and $47,271, respectively, for the Emerging Markets
Fund and the U.S. Small Cap Fund. The Advisor has not recouped $10,033 of
prior period expense waivers and reimbursements from the U.S. Small Cap
Fund as of April 30, 1998.
For the Select Fund and the Real Estate Securities Fund, the Advisor has
voluntarily limited the total operating expenses to 1.40% and 0.50%,
respectively, of average net assets. For the four months ended April 30,
1998, the Advisor waived and/or reimbursed expenses of $29,773 and
$61,922, respectively, for the Select Fund and the Real Estate Securities
Fund.
78
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
For the Bond Fund, the Advisor has voluntarily waived 0.10% out of the
0.15% administrative fee beginning on March 1, 1998. Prior to March 1,
1998, the Advisor voluntarily waived the administrative fee in its
entirety. For the six months ended April 30, 1998, the Advisor waived
administrative fees of $74,439 for the Bond Fund.
For the Money Market Fund, the Advisor has voluntarily waived the
administrative fee in its entirety. For the six months ended April 30,
1998, the Advisor waived administrative fees of $351,362 for the Money
Market Fund.
For the California Intermediate Tax-Free Fund, the Advisor has voluntarily
reduced the advisory and administrative fees to 0.30% and 0.005% ,
respectively, of average net assets. For the six months ended April 30,
1998, the Advisor waived advisory and administrative fees of $18,596 and
$46,867, respectively, for the California Intermediate Tax-Free Fund.
Ratios of expenses have been disclosed both before and after the impact of
these various waivers and/or reimbursements under each Fund's Financial
Highlights table.
Under the terms of the Advisory agreement, the Advisor receives a single
management fee from the U.S. Micro-Cap Fund, and is obligated to pay all
expenses of the Funds except extraordinary expenses (as determined by a
majority of the disinterested directors) and interest, brokerage
commissions, and other transaction charges relating to the investing
activities of those Funds.
Pursuant to Rule 12b-1 under the Investment Company Act of 1940, the
International Growth Fund, the International Small Cap Fund, the Emerging
Markets Fund, the U.S. Small Cap Fund, the Select Fund and the Real Estate
Securities Fund have adopted a plan of distribution under which the Funds
may directly compensate the Advisor for certain distribution-related
expenses. The annual limitation for compensation to the Advisor pursuant
to the plan of distribution is 0.25% of a Fund's average daily net assets.
All payments are reviewed by the Board of Directors.
Each Fund is also required to comply with the limitations set forth in the
laws, regulations, and administrative interpretations of the states in
which it is registered. For the six months ended April 30, 1998, no
reimbursements were required or made to any Fund by the Advisor to comply
with these limitations.
Affiliated Company Transactions
Investments in portfolio companies, 5% or more of whose outstanding voting
securities are held by a Fund, are defined in the Investment Act of 1940
as affiliated companies. The U.S. Micro-Cap Fund had investments in such
affiliated companies. A summary of transactions for each issuer who is an
affiliate during the six months ended April 30, 1998, follows ($ in
thousands):
<TABLE>
<CAPTION>
Share Aggregate Aggregate Net Share
Balance Purchase Sales Realized Balance Value
Issuer 10/31/97 Cost Cost Gain/(Loss) Income 4/30/98 4/30/98
<S> <C> <C> <C> <C> <C> <C> <C>
Interlink Electronics, Inc. 320,000 $-- $-- $-- $-- 320,000 $ 1,601
------------------------------------ -------
$-- $-- $-- $-- $ 1,601
==================================== =======
</TABLE>
Other Related Parties
At April 30, 1998, Fremont Investors, Inc. and its affiliated companies
including their employee retirement plans, its principal shareholder and
members of his family, including trusts, owned directly or indirectly the
following approximate percentages of the various Funds:
% of Shares Outstanding
-----------------------
Global Fund 62%
International Growth Fund 87%
International Small Cap Fund 44%
Emerging Markets Fund 41%
U.S. Small Cap Fund 78%
Select Fund 91%
Growth Fund 56%
Real Estate Securities Fund 6%
Bond Fund 80%
Money Market Fund 79%
California Intermediate Tax-Free Fund 70%
79
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Certain officers and/or directors of the Funds are also officers and/or
directors of the Advisor and/or Fremont Investors, Inc. None of the
officers and/or directors so affiliated receive compensation for services
as officers and/or directors of the Funds.
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).
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, 1998 were as follows:
<TABLE>
<CAPTION>
Purchases Proceeds
--------- --------
<S> <C> <C>
Long-term securities excluding U.S. Government securities:
Global Fund $ 276,043,344 $ 307,933,154
International Growth Fund 41,233,851 34,345,105
International Small Cap Fund 6,278,634 8,070,563
Emerging Markets Fund 14,852,968 7,665,708
U.S. Micro-Cap Fund 135,499,478 144,397,666
U.S. Small Cap Fund 8,548,991 7,269,065
Select Fund 7,902,777 2,598,877
Growth Fund 46,046,941 38,488,309
Real Estate Securities Fund 23,117,510 6,424,231
Bond Fund 62,401,262 21,870,048
California Intermediate Tax-Free Fund 3,686,469 1,000,000
Long-term U.S. Government securities:
Global Fund $ 20,008,151 $ 14,669,997
Bond Fund 124,714,445 106,217,719
</TABLE>
Transactions in written put and call options for the six months ended
April 30, 1998 for the Bond Fund were as follows:
<TABLE>
<CAPTION>
Amount of Premiums Number of Contracts
------------------ -------------------
<S> <C> <C>
Options outstanding at October 31, 1997 $ 41,625 50
Options sold -- --
Options cancelled in closing purchase transactions -- --
Options expired prior to exercise (41,625) (50)
Options exercised -- --
---------- -----
Options outstanding at April 30, 1998 $ -- --
========== =====
</TABLE>
5. PORTFOLIO CONCENTRATIONS
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, 1998, 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>
Global Fund $617,514,899 $117,406,287 $(18,171,917) $ 99,234,370
International Growth Fund 43,246,084 3,970,491 (1,368,697) 2,601,794
International Small Cap Fund 7,177,597 213,657 (357,004) (143,347)
Emerging Markets Fund 17,199,535 1,505,000 (1,447,225) 57,775
U.S. Micro-Cap Fund 180,213,132 18,565,778 (19,242,107) (676,329)
U.S. Small Cap Fund 7,513,500 504,460 (321,639) 182,821
</TABLE>
80
<PAGE>
FREMONT MUTUAL FUNDS, INC.
Notes to Financial Statements - April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Gross Aggregate Unrealized
--------------------------
Cost Appreciation Depreciation Net
---- ------------ ------------ ---
<S> <C> <C> <C> <C>
Select Fund $ 5,578,280 $ 457,702 $ (164,279) $ 293,423
Growth Fund 132,560,032 43,809,451 (1,035,356) 42,774,095
Real Estate Securities Fund 19,027,735 176,999 (415,076) (238,077)
Bond Fund 146,606,858 2,082,261 (430,013) 1,652,248
Money Market Fund 501,260,613 -- -- --
California Intermediate Tax-Free Fund 61,623,628 2,613,412 (27,680) 2,585,732
</TABLE>
81
<PAGE>
Fremont
Funds [LOGO]
50 Beale Street, Suite 100
San Francisco, CA 94105
www.fremontfunds.com
Distributed by First Fund Distributors, Inc., San Francisco, CA 94105
BR008-9806
