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ANCHOR
STRATEGIC
ASSETS
TRUST
ANNUAL REPORT
DECEMBER 31, 1996
<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1996
Assets:
Investments at quoted market value (cost $6,290,061;
see Schedule of Investments, Notes 1, 2, & 5)...... $ 6,371,288
Cash ................................................ 1,834,248
Dividends and interest receivable.................... 5,550
-----------
Total assets..................................... 8,211,086
-----------
Liabilities:
Payable for capital shares redeemed.................. 2,425
Accrued expenses and other liabilities (Note 3)...... 26,416
-----------
Total liabilities................................ 28,841
-----------
Net Assets:
Capital stock (unlimited shares authorized at $1.00 par
value, amount paid in on 1,684,362 shares outstanding)
(Note 1)............................................ 8,684,896
Accumulated overdistributed net investment income.... (280,789)
Accumulated realized loss from security transactions,
net.................................................. (303,089)
Net unrealized appreciation in value of investments
(Note 2)............................................. 81,227
-----------
Net assets (equivalent to $4.86 per share, based on
1,684,362 capital shares outstanding)........... $ 8,182,245
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<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
STATEMENT OF OPERATIONS
DECEMBER 31, 1996
Income:
Dividends........................................... $ 31,519
Interest............................................ 6,077
-----------
Total income..................................... 37,596
-----------
Expenses:
Management fees (Note 3)............................ 113,048
Pricing and bookkeeping fees (Note 4)............... 16,000
Legal fees.......................................... 8,086
Audit and accounting fees........................... 7,500
Custodian fees...................................... 2,000
Trustees' fees and expenses......................... 1,000
Transfer fees (Note 4).............................. 1,000
Other expenses...................................... 2,811
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Total expenses................................... 151,445
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Net investment loss.................................. (113,849)
-----------
Realized and unrealized gain (loss) on investments:
Realized loss on investments-net................... (72,237)
Increase in net unrealized appreciation in investments 472,229
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Net gain on investments.......................... 399,992
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Net increase in net assets resulting from operations. $ 286,143
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<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
STATEMENTS OF CHANGES IN NET ASSETS
Year Ended Year Ended
December 31, December
1996 31, 1995
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From operations:
Net investment loss..................... $(113,849) (54,853)
Realized loss on investments, net....... (72,237) (92,182)
Increase in net unrealized
appreciation in investments............ 472,229 227,106
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Net increase in net assets
resulting from operations.......... 286,143 80,071
------------ -----------
Distributions to shareholders:
From net investment income.............. -- --
From net realized gain on investments... -- --
------------ -----------
Total distributions to shareholders.. -- --
------------ -----------
From capital share transactions:
Number of Shares
1996 1995
Proceeds from sale of
shares.............. 774,469 227,990 3,891,921 1,035,489
Shares issued to
share holders in
distributions
reinvested.......... -- -- -- --
Cost of shares (274,859)(87,525) (1,409,327) (381,325)
redeemed............ --------- --------- ----------- -----------
Increase in net
assets resulting
from capital
share transactions.. 499,610 140,465 2,482,594 654,164
======== ========== ------------ -----------
Net increase in net assets............... 2,768,737 734,235
Net assets:
Beginning of period.................... 5,413,508 4,679,273
============ ============
End of period (including overdistributed
net investment income of $280,789 and
$166,941, respectively ).......... $ 8,182,245 $5,413,508
============ ============
<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
SELECTED PER SHARE DATA AND RATIOS
(for a share outstanding throughout each period)
Year Ended December 31,
1996 1995 1994 1993
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Investment income.................... $0.01 $0.03 $(3.40) $ 0.19
Expenses, net........................ 0.03 0.06 (7.86) 2.19
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Net investment income (loss)......... (0.02) (0.03) 4.46 (2.00)
Net realized and unrealized
gain (loss) on investments.......... 0.31 0.12 (5.41) --
Distributions to shareholders:
From net investment
income............................ -- -- -- --
From net realized gain
on investments.................... -- -- -- --
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Net increase (decrease)
in net asset value.................. 0.29 0.09 (0.95) (2.00)
Net asset value:
Beginning of period................. 4.57 4.48 5.43 7.43
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End of period....................... $4.86 $4.57 $4.48 $5.43
========================================
Ratio of expenses to
average net assets.................. 1.98% 1.99% 2.19% 30.85%
Ratio of net investment
loss to average net assets.......... (1.49)% (1.10)% (1.24%) (28.14)%
Portfolio turnover................... 0.37 0.12 0.42 --
Number of shares out-
standing at end of period...........1,684,362 1,184,7521,044,287 12,000
Per share data and ratios assuming
no waiver of advisory fees:
Expenses............................. -- -- -- $2.30
Net investment loss.................. -- -- -- $(2.11)
Ratio of expenses to
average net assets.................. -- -- -- 32.35%
Ratio of net investment loss
to average net assets.............. -- -- -- (29.64)%
<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1996
Value
Quantity (Note 1)
COMMON STOCKS -- 41.64%
Gold/Silver Mining Stocks
40,000 Aquiline Resources Corporation................. $ 34,400
6,000 Barrick Gold Corporation....................... 171,750
20,000 Bema Gold Corporation.......................... 118,760
25,000 Cambior Incorporated........................... 367,000
15,000 Euro-Nevada Mining Corporation................. 441,900
9,000 Franco-Nevada Mining Corporation............... 400,860
9,583 Freeport McMoRan Copper & Gold, Class A........ 269,522
15,000 Golden Star Resources.......................... 195,000
33,500 Guyanor Resources, Class B..................... 232,490
65,000 Miramar Mining Corporation..................... 284,700
144,840 Normandy Mining Limited........................ 199,879
22,300 Northern Orion Exploration Limited............. 82,287
20,000 Prime Resources Group Incorporated............. 138,800
10,000 Rayrock Yellowknife Resources Incorporated.... 49,700
10,000 Stillwater Mining Company...................... 181,250
7,000 Teck Inc., Class B............................. 158,480
18,000 Viceroy Resources.............................. 80,100
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Total common stocks (cost $3,205,628).......... 3,406,878
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PRECIOUS METALS -- 24.17%
Bullion
5,337 Ounces gold bullion (cost $2,098,030).......... 1,978,007
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U.S. TREASURY BILLS -- 12.06%
$1,000,00Treasury Bill, 5.01% yield, maturing 2/27/97
(at cost)...................................... 986,403
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Total investments (cost $6,290,061)............ 6,371,288
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CASH & OTHER ASSETS, LESS LIABILITIES -- 22.13% 1,810,957
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Total Net Assets............................... $ 8,182,245
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<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996
1. Significant accounting policies:
Anchor Strategic Assets Trust, a Massachusetts business trust (the "Trust"),
is registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end investment management company. The following is a
summary of significant accounting policies followed by the Trust which are in
conformity with those generally accepted in the investment company industry.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. A. Investment securities--
Security transactions are recorded
on the date the investments are purchased or sold. Each day, at noon,
securities traded on national security exchanges are valued at the last sale
price on the primary exchange on which they are listed, or if there has been
no sale by noon, at the current bid price. Other securities for which market
quotations are readily available are valued at the last known sales price,
or, if unavailable, the known current bid price which most nearly represents
current market value. The gold bullion is valued each day at noon based on
the New York spot gold price. Temporary cash investments are stated at cost,
which approximates market value. Dividend income is recorded on the
ex-dividend date and interest income is recorded on the accrual basis. Gains
and losses from sales of investments are calculated using the "identified
cost" method for both financial reporting and federal income tax purposes.
B. Income Taxes-- The Trust has elected to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and
to distribute each year all of its taxable income to its shareholders. No
provision for federal income taxes is necessary since the Trust intends to
qualify for and elect the special tax treatment afforded a "regulated
investment company" under subchapter M of the Internal Revenue Code.
C. Capital Stock-- The Trust records the sales and redemptions
of its capital stock on trade date.
2. Tax basis of investments:
At December 31, 1996, the total cost of investments for federal income tax
purposes was identical to the total cost on a financial reporting basis.
Aggregate gross unrealized appreciation in investments in which there was an
excess of market value over tax cost was $537,767. Aggregate gross unrealized
depreciation in investments in which there was an excess of tax cost over
market value was $456,540. Net unrealized appreciation in investments at
December 31, 1996 was $81,227.
<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996
(Continued)
3. Investment advisory service agreements:
The investment advisory contract with Anchor Investment Management
Corporation (the "investment adviser") provides that the Trust will pay the
adviser a fee for investment advice based on a rate of 1 1/2% per annum of
the average daily net assets. At December 31, 1996, investment advisory fees
of $10,418 were due which were included in "Accrued expenses and other
liabilities" in the accompanying Statement of Assets and Liabilities. David
Y. Williams, a Trustee of the Trust, is President and a Director of the
Investment Adviser.
4. Certain transactions:
Anchor Investment Management Corporation provides transfer agent services for
the Trust. Fees earned by Anchor Investment Management Corporation for
transfer agent services for the year ended December 31, 1996 were $1,000.
Certain officers and trustees of the Trust are directors and/or officers of
the investment adviser and distributor. Meeschaert & Co., Inc. the Trust's
distributor, received $3,091 in brokerage commissions during the year ended
December 31, 1996. Fees earned by Anchor Investment Management Corporation
for expenses related to daily pricing of the Trust shares and for bookkeeping
services for the year ended December 31, 1996 were $16,000.
5. Purchases and sales:
Aggregate cost of purchases and the proceeds from sales and maturities on
investments for the year ended December 31, 1996 were:
Cost of securities acquired:
U.S. Government and investments backed by
such securities $ 986,403
Other investments....................... 2,463,092
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$ 3,449,495
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Proceeds from sales and maturities:
U.S. Government and investments backed by
such securities $ --
Other investments....................... 2,408,115
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$ 2,408,115
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<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Trustees of Anchor Strategic Assets
Trust:
We have audited the accompanying statement of assets and liabilities of Anchor
Strategic Assets Trust (a Massachusetts business trust), including the schedule
of investments, as of December 31, 1996, the related statement of operations for
the year then ended, the statements of changes in net assets for each of the two
years in the period then ended, and the selected per share data and ratios for
each of the four years in the period then ended. These financial statements and
per share data and ratios are the responsibility of the Trust's management. Our
responsibility is to express an opinion on these financial statements and per
share data and ratios based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and per share data
and ratios are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1996 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and selected per share data and ratios
referred to above present fairly, in all material respects, the financial
position of Anchor Strategic Assets Trust as of December 31, 1996, the results
of its operations for the year then ended, the changes in its net assets for
each of the two years in the period then ended, and the selected per share data
and ratios for each of the four years in the period then ended, in conformity
with generally accepted accounting principles.
LIVINGSTON & HAYNES, P.C.
Wellesley, Massachusetts,
January 17, 1997.
<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
OFFICERS AND TRUSTEES
DAVID W.C. PUTNAM Chairman
Chairman, Board of Directors, F.L. Putnam and Trustee
Investment Management Corporation
President and Director, F.L. Putnam
Securities Company Incorporated
J. STEPHEN PUTNAM Vice President and
President, Robert Thomas Securities Treasurer
SPENCER H. LE MENAGER Secretary
President, Equity Inc. and Trustee
MAURICE A. DONAHUE Trustee
Director and Professor, Institute for
Governmental Services and
Walsh-Saltonstall Professor of Practical
Politics, University of Massachusetts
DAVID Y. WILLIAMS President
President and Director, Meeschaert & Co., and Trustee
Inc.,
President and Director, Anchor Investment
Management Corporation
<PAGE>
ANCHOR STRATEGIC ASSETS TRUST
INVESTMENT ADVISER AND TRANSFER AGENT
Anchor Investment Management Corporation
2717 Furlong Rd., Doylestown, Pennsylvania 18901
(215) 794-2980
DISTRIBUTOR
Meeschaert & Co., Inc.
2717 Furlong Rd., Doylestown, Pennsylvania 18901
CUSTODIAN
Investors Bank & Trust Company
89 South Street, Boston, Massachusetts 02111
INDEPENDENT PUBLIC ACCOUNTANT
Livingston & Haynes, P.C.
40 Grove St., Wellesley, Massachusetts 02181
LEGAL COUNSEL
Yukevich, Blume, Marchetti & Zangrilli
One Gateway Center, Pittsburgh, Pennsylvania 15222
