JUNE 30, 1996
Dear Fellow Shareholder,
The Torray Fund earned 8.4% during the first half of 1996. Since we began
operations 5 1/2 years ago, its return stands at 18.8% compounded annually.
Charts on pages 4 and 5 graphically illustrate these results and compare them to
the general stock market as measured by the Standard & Poor's 500 Stock Index.
We remain highly confident and enthusiastic about the business fundamentals
of the companies in our portfolio. In fact, during the first half of this year,
we used the money received from existing and new shareholders to buy more of the
same stocks we have favored all along. We also made initial investments in
American Express, Crown Cork and Seal, Eastman Chemical Company, and the Walt
Disney Company.
As I have mentioned in the past, the deferral of taxes plays an important
role in our management of your assets. This, of course, is because a lot of
money can be made earning double-digit returns on funds which otherwise would
have gone to the tax collector. So far we have been successful in this regard.
Even assuming the highest tax rates on ordinary income and capital gains, Torray
Fund shareholders have made 17.5% compounded after taxes over the last 5 1/2
years. This result was achieved simply by holding onto our investments, as
opposed to trading them.
In last year's Annual Report I expressed the opinion that neither your
Fund's 50.4% return that year nor the market's 37.5% rise was likely to repeat
anytime soon. Our 1995 mid-year letter said that we thought the speculative boom
in technology shares would probably end badly and that a collapse in tech stocks
was apt to cause a sag in the market. As I write, late in July, these views, to
some extent, have been confirmed. Many technology stocks are down sharply, and
the general market has slumped from its highs reached earlier in the year.
The market's sudden change in direction, coupled with its increased
volatility, has caused much hand wringing. One Wall Street analyst, famous at
the time for forecasting the October 1987 crash, recently predicted a 15-20%
market dive; and The Wall Street Journal reports that a well-known strategist
thinks the Dow Jones average will drop 1,000 points. (On the flip side, it says
another predicts just the opposite.) Other gurus, advisory services and the
media also warn of a possible downturn. Some see a 5% correction, others a
protracted bear market. Similar forebodings from many of the same sources were
heard in 1994. At the time, we urged shareholders to ignore them; we still think
that's a good idea.
1
<PAGE>
JUNE 30, 1996
Our June 1994 report reviewed the history of stock returns over the 68
years (816 months) from 1925 to 1993. During that period, $1 invested in stocks
became $800. However, nearly all of the return was generated in just 30 of those
months. This statistic, we said, illustrated the futility of trying to profit by
catching major market advances or to avoid losses by getting out ahead of market
declines. The historic odds against riding only the upswings were, at that
point, 27 to 1 -- surely enough to make a person think twice. The odds today are
about the same. Figures updated through December 31, 1995 are now available
courtesy of Ibbotson Associates, Chicago, Illinois. One dollar invested in
stocks 70 years ago was worth $1,114 at last year's close. Absent the market's
35 best months out of a total 840 months, however, it would have grown to only
$10.16. Even U.S. Treasury Bills did better, turning a dollar into $12.87.
The revisiting of these numbers instructs us anew to forget about the
market and to reject the forecasts of "experts", many of whom cloak their views
in a mist, presumably so they can later claim they were right regardless of the
outcome. Instead, we should rely on what we know: over time, good businesses
produce high returns for their owners. Value derives from the business, not from
the stock. Unfortunately, a lot of people believe the opposite. As I noted in an
earlier report, portfolio management has evolved into a momentum-driven battle
for short-term performance. In this arena, the direction of stock prices is
controlling, not business fundamentals. The release of quarterly earnings and
current economic data at odds with analysts' expectations often triggers waves
of buying and selling on the exchanges, even though the information is
meaningless in a long-term context. For example, a recent employment report
showing that 50,000 people had found jobs above the number Wall Street expected
was interpreted by portfolio managers as a sign inflation would soon accelerate.
In response, bond prices fell and the Dow Jones average sank 165 points. Later
the same day, the Dow recovered to a gain of 50 points, then lost 80, and
finally closed up 7. Volume was an all-time record 680 million shares. In the
end, nothing had been accomplished and nothing had changed, except that certain
stocks which began the day in portfolio "A", now could be found in portfolio
"B". Boeing was still making airplanes, Citicorp was lending, and Salomon was
trading bonds around the clock, around the world. It was a day of prosperity for
the brokers only.
Wall Street's confounding reaction to the recent release of second quarter
earnings by IBM (a Torray Fund holding) and Microsoft serves to further
illustrate how irrelevant statistics often influence institutional decision
making. Nearly everyone, it seems, expected IBM's earnings to be off. For this
reason, and also reflecting the crash in many technology stocks, IBM shares had
fallen from a 52-week high of $128 per share to $90. While the earnings were
indeed 22% lower than those of the previous quarter, they also proved to be 7
cents a share above analysts' predictions --
2
<PAGE>
JUNE 30, 1996
an amount totaling $38 million on IBM's 540 million outstanding shares. This is
an insignificant sum -- a rounding error so to speak -- to a company earning $6
billion on sales of $77 billion. You would never know it, though, judging from
the action at the New York Stock Exchange. In heavy trading, IBM's shares jumped
$12 to close at $102, a rise which added $6.5 billion to the company's market
value in just a few hours. Thus, institutions which had valued IBM at only 8
times earnings in the morning, now multiplied the $38 million surprise by 170 in
the afternoon. In sharp contrast, several days earlier, Microsoft announced that
its earnings were up 50%, but the stock dropped 5 points because analysts had
expected more. These examples are just the tip of the iceberg when it comes to
measuring how nonsensical and wasteful of investor's money much of the portfolio
management business has become. Among other things, it makes one wonder if some
financial executives shouldn't consult an analyst of a different kind.
In closing, I want each of you to know that we believe the long-term
outlook for your investment is excellent. Reflecting our confidence, the Torray
Fund's management, Trustees and their families have increased their collective
ownership to 659,993 shares, representing 21.2% of the Fund's total
capitalization. We also want to reaffirm our promise that shareholders' expenses
will not exceed 1.25% of assets. In keeping with this commitment, the Torray
Corporation, during the first half of 1996, reimbursed the Fund for $100,265 of
its expenses.
Once again, please know that we greatly appreciate your confidence. If you
have any questions about your investment, feel free to contact us directly. You
are also welcome to visit if you find yourself in our area.
Sincerely,
/s/ Robert E. Torray
Robert E. Torray
PRESIDENT
THE TORRAY CORPORATION
3
<PAGE>
THE TORRAY FUND
PERFORMANCE DATA
AS OF JUNE 30, 1996 (UNAUDITED)
TOTAL RATES OF RETURN ON HYPOTHETICAL $10,000 INVESTMENT VS. S&P 500
FOR EACH OF THE YEARS OR PERIODS STATED
<TABLE>
<CAPTION>
1991 1992 1993 1994 1995 6/30/96 5 1/2 YEARS
<S> <C> <C> <C> <C> <C> <C> <C>
THE TORRAY FUND 19.98 % 21.04 % 6.37 % 2.41 % 50.41 % 8.39 % 157.93%
S&P 500 30.48 % 7.66 % 10.09 % 1.30 % 37.54 % 10.04 % 137.12%
</TABLE>
Table 1
4
<PAGE>
THE TORRAY FUND
PERFORMANCE DATA
AS OF JUNE 30, 1996 (UNAUDITED)
CHANGE IN VALUE OF $10,000 INVESTED ON DECEMBER 31, 1990 (COMMENCEMENT OF
OPERATIONS)
(ASSUMING REINVESTMENT OF DIVIDENDS AND DISTRIBUTIONS)
<TABLE>
<CAPTION>
12/31/90 1991 1992 1993 1994 1995 6/30/96
<S> <C> <C> <C> <C> <C> <C> <C>
THE TORRAY FUND $10,000 $11,999 $14,523 $15,448 $15,821 $23,796 $25,793
S&P 500 $10,000 $13,048 $14,047 $15,465 $15,666 $21,547 $23,710
</TABLE>
Table 2
AVERAGE ANNUAL TOTAL RETURNS
(FOR PERIODS ENDED JUNE 30, 1996)
<TABLE>
<CAPTION>
1 Year 2 Years 3 Years 4 Years 5 Years 5 1/2 Years
<S> <C> <C> <C> <C> <C> <C>
TORRAY FUND 34.12% 29.40% 20.45% 17.92% 18.02% 18.82%
S&P 500 25.92% 25.99% 17.19% 16.27% 15.70% 17.01%
</TABLE>
5
<PAGE>
THE TORRAY FUND
SCHEDULE OF INVESTMENTS
AS OF JUNE 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
OR SHARES VALUE
<S> <C>
U.S. GOVERNMENT OBLIGATIONS 0.3%
200,000 U.S. Treasury Bill $ 195,680
5.454% due 11/29/96
TOTAL U.S. GOVERNMENT OBLIGATIONS 195,680
(amortized cost $195,513)
COMMON STOCK 99.8%
MANUFACTURING 55.2%
ICE CREAM & FROZEN DESSERTS 3.0%
65,000 Dreyer's Grand Ice Cream, Inc. 2,047,500
BAKERY PRODUCTS 2.7%
68,000 Interstate Bakeries Corp. 1,819,000
GRAIN MILL PRODUCTS 4.1%
43,000 Ralston Purina Group 2,757,375
METAL CANS 2.0%
30,000 Crown Cork & Seal Co. 1,350,000
CIGARETTES 4.2%
27,000 Philip Morris Cos., Inc. 2,808,000
PAPER MILLS 4.8%
42,000 Kimberly-Clark Corp. 3,244,500
NEWSPAPERS:PUBLISHING OR PUBLISHING & PRINTING 0.9%
8,500 Gannett Co., Inc. 601,375
PHARMACEUTICAL PREPARATIONS 9.8%
12,000 American Home Products Corp. 721,500
10,000 Bristol-Myers Squibb Co. 900,000
34,000 Johnson & Johnson 1,683,000
40,000 Lilly (Eli) & Co. 2,600,000
10,000 Pfizer, Inc. 713,750
Total Pharmaceutical Preparations 6,618,250
CHEMICALS & ALLIED PRODUCTS 1.7%
19,000 Eastman Chemical Co. 1,156,625
ADHESIVES AND SEALANTS 2.8%
50,800 Morton International, Inc. 1,892,300
</TABLE>
6
<PAGE>
THE TORRAY FUND
SCHEDULE OF INVESTMENTS
AS OF JUNE 30, 1996 (UNAUDITED)
<TABLE>
<S> <C>
SHIP & BOAT BUILDING & REPAIRING 5.1%
55,000 General Dynamics Corp. 3,410,000
AIRCRAFT 2.8%
10,000 Boeing Co. 871,250
15,000 Northrop Grumman Corp. 1,021,875
Total Aircraft 1,893,125
GUIDED MISSLES, SPACE VEHICLES & PARTS 4.0%
32,000 Lockheed Martin Corp. 2,688,000
PLASTICS PRODUCTS, NEC 1.4%
35,000 Rubbermaid, Inc. 953,750
ELECTRONIC & OTHER ELECTRIC EQUIP NON COMPUTER 1.7%
13,000 General Electric Co. 1,124,500
COMPUTER & OFFICE EQUIPMENT 3.7%
25,000 I B M Corp. 2,475,000
SURGICAL & MEDICAL INSTRUMENTS & APPARATUS 0.7%
9,000 Guidant Corp. 443,250
TOTAL MANUFACTURING 37,282,550
WHOLESALE AND RETAIL TRADE 4.1%
WHOLESALE-FARM PRODUCT RAW MATERIALS 1.9%
104,060 Standard Commercial Corp.* 1,248,720
RETAIL-DEPARTMENT STORES 2.2%
30,000 Harcourt General, Inc. 1,500,000
TOTAL WHOLESALE AND RETAIL TRADE 2,748,720
FINANCE, INSURANCE AND REAL ESTATE 35.2%
NATIONAL COMMERCIAL BANKS 15.2%
32,000 Citicorp 2,644,000
27,184 First American Corp. Tenn. 1,145,126
90,000 Liberty Bancorp, Inc. (Okla.) 3,195,000
58,000 Mellon Bank Corp. 3,306,000
Total National Commercial Banks 10,290,126
SAVINGS INSTITUTIONS, NOT FEDERALLY CHARTERED 2.2%
94,306 Southern Financial Bancorp, Inc. 1,461,743
</TABLE>
7
<PAGE>
THE TORRAY FUND
SCHEDULE OF INVESTMENTS
AS OF JUNE 30, 1996 (UNAUDITED)
<TABLE>
<S> <C>
MISCELLANEOUS BUSINESS CREDIT INSTITUTIONS 6.4%
58,000 Student Loan Marketing (New Vtg) 4,292,000
SECURITY & COMMODITY BROKERS, DEALERS & SVCS. 5.5%
85,000 Salomon Inc. 3,740,000
SECURITY BROKERS, DEALERS & FLOTATION COS. 1.8%
50,000 Lehman Brothers Holdings, Inc. 1,237,500
REAL ESTATE-(LEISURE CONDOS ONLY) 4.1%
115,000 CarrAmerica Realty Corp. 2,760,000
TOTAL FINANCE, INSURANCE AND REAL ESTATE 23,781,369
SERVICES 5.2%
TRAVEL AGENCIES 1.0%
15,000 American Express Co. 669,375
SERVICES-GENERAL MEDICAL & SURGICAL HOSPITALS 2.8%
89,000 Tenet Healthcare Corp.* 1,902,375
MISC. AMUSEMENT & RECREATION 1.4%
15,000 Disney (Walt) Co. 943,125
TOTAL SERVICES 3,514,875
TOTAL COMMON STOCK 67,327,514
(cost $51,107,907)
TOTAL PORTFOLIO SECURITIES 100.1% 67,523,194
(amortized cost $51,303,420)
OTHER ASSETS LESS LIABILITIES (0.1%) (41,433)
NET ASSETS $67,481,761
FIVE LARGEST HOLDINGS
Student Loan Marketing
Salomon Inc.
General Dynamics Corp.
Mellon Bank Corp.
Kimberly-Clark Corp.
* Non-income producing security
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
8
<PAGE>
THE TORRAY FUND
STATEMENT OF ASSETS AND LIABILITIES
AS OF JUNE 30, 1996 (UNAUDITED)
<TABLE>
<S> <C>
ASSETS
Investments in securities at value
(amortized cost $51,303,420) $67,523,194
Cash 8,771
Interest and dividends receivable 71,835
TOTAL ASSETS 67,603,800
LIABILITIES
Payable for securities purchased 119,740
Payable to The Torray Corporation 2,299
TOTAL LIABILITIES 122,039
NET ASSETS $67,481,761
Shares of beneficial interest
($1 stated value, 3,111,102 shares
outstanding, unlimited shares authorized) $ 3,111,102
Paid-in-capital in excess of par 47,294,316
Undistributed net investment income (4,882)
Undistributed net realized gains 861,451
Net unrealized appreciation of investments 16,219,774
NET ASSETS $67,481,761
PER SHARE $ 21.690
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
9
<PAGE>
THE TORRAY FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1996 (UNAUDITED)
<TABLE>
<S> <C> <C>
INVESTMENT INCOME
Interest income $ 36,359
Dividend income 676,418
Total income 712,777
EXPENSES
Management fees 308,461
Other expenses:
Legal fees $ 22,960
Transfer agent fees 19,500
Audit fees 14,351
Registration & filing fees 29,411
Custodian's fees 9,408
Accounting services 14,880
Trustees' fees 5,400
Administration 27,000
Printing 34,264
Insurance 375
Miscellaneous 8
Total 177,557
Expense reimbursement (100,265) 77,292
Total expenses 385,753
NET INVESTMENT INCOME 327,024
REALIZED AND UNREALIZED GAIN(LOSS)
ON INVESTMENTS
Net realized gain on
investments 860,297
Net change in unrealized gain 3,412,014
Net gain on investments 4,272,311
NET INCREASE IN NET ASSETS
FROM OPERATIONS $ 4,599,335
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
10
<PAGE>
THE TORRAY FUND
STATEMENT OF CHANGES IN NET ASSETS
FOR THE PERIODS BELOW:
<TABLE>
<CAPTION>
6 MOS.
ENDED YEAR
6/30/96 ENDED
(UNAUDITED) 12/31/95
<S> <C> <C>
INCREASE IN NET ASSETS FROM
OPERATIONS:
Net investment income $ 327,024 $ 416,197
Net realized gain on
investments 860,297 791,792
Net change in unrealized
gain (loss) 3,412,014 11,564,512
Net increase in net
assets from
operations 4,599,335 12,772,501
DISTRIBUTIONS TO SHAREHOLDERS
FROM:
Net investment income (333,657) (414,625)
Net realized gains 0 (790,687)
Total distributions (333,657) (1,205,312)
SHARES OF BENEFICIAL INTEREST
Increase from share
transactions 12,472,481 15,814,356
Total increase 16,738,159 27,381,545
Net assets -- beginning of period 50,743,602 23,362,057
Net assets -- end of period $67,481,761 $50,743,602
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
11
<PAGE>
THE TORRAY FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS BELOW:
PER SHARE DATA($)
<TABLE>
<CAPTION>
6 MOS ENDED YEAR YEAR YEAR YEAR YEAR
6/30/96 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 12/31/95 12/31/94 12/31/93 12/31/92 12/31/91
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $20.110 $ 13.755 $ 14.273 $ 13.743 $ 11.514 $ 9.999
Income From Investment Operations
Net Investment Income 0.105 0.215 0.213 0.122 0.180 0.232
Net Gains on Securities
(both realized and unrealized) 1.581 6.674 0.130 0.745 2.229 1.728
Total from Investment Operations 1.686 6.889 0.343 0.867 2.409 1.960
Less Distributions
Dividends (from Net Investment Income) (0.106) (0.214) (0.213) (0.122) (0.180) (0.233)
Distributions (from Capital Gains) 0.000 (0.320) (0.648) (0.215) 0.000 (0.212)
Total Distributions (0.106) (0.534) (0.861) (0.337) (0.180) (0.445)
NET ASSET VALUE, END OF PERIOD $21.690 $ 20.110 $ 13.755 $ 14.273 $ 13.743 $ 11.514
TOTAL RETURN3 8.39% 50.41% 2.41% 6.37% 21.04% 19.98%
RATIOS / SUPPLEMENTAL DATA
Net Assets, End of Period (000's omitted) $67,482 $ 50,744 $ 23,362 $ 19,666 $ 10,298 $ 4,423
Ratio of Expenses to Average Net Assets 1.25%1 1.25% 1.25% 1.25% 1.25% 1.25%
Ratio of Net Income to Average Net Assets 1.06%1 1.31% 1.51% 0.94% 1.54% 2.43%
Portfolio Turnover Rate 10.56% 22.56% 36.63% 29.09% 37.09% 21.17%
Average Actual Commissions paid per share4 $0.1093 $ 0.0813 n/a n/a n/a n/a
<CAPTION>
14 DAYS
ENDED
12/31/90
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.000
Income From Investment Operations
Net Investment Income 0.005
Net Gains on Securities
(both realized and unrealized) 0.000
Total from Investment Operations 0.005
Less Distributions
Dividends (from Net Investment Income) (0.006)
Distributions (from Capital Gains) 0.000
Total Distributions (0.006)
NET ASSET VALUE, END OF PERIOD $ 9.999
TOTAL RETURN3 (0.03%)
RATIOS / SUPPLEMENTAL DATA
Net Assets, End of Period (000's omitted) $ 200
Ratio of Expenses to Average Net Assets 0.82%1
Ratio of Net Income to Average Net Assets 2.15%1
Portfolio Turnover Rate n/a2
Average Actual Commissions paid per share4 n/a
</TABLE>
1 Annualized
2 Not applicable. During the period December 18, 1990 through December 31,
1990 the Fund invested only in short term investments which are excluded
from this ratio.
3 Past performance is not predictive of future performance.
4 Does not include spreads on shares traded on a principal basis.
SEE NOTES TO THE FINANCIAL STATEMENTS.
12
<PAGE>
THE TORRAY FUND
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996 (UNAUDITED)
NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Torray Fund ("Fund") is registered under the Investment Company Act of
1940 as a no load, diversified, open-end management investment company. The Fund
was organized as a business trust under Massachusetts law. The Torray
Corporation serves as administrator and investment advisor to, and transfer
agent for the Fund.
The initial capitalization of the Fund, $100,000, was provided on November
16, 1990 by Robert E. Torray who is an officer, director and shareholder of The
Torray Corporation. The Fund commenced operations on December 18, 1990. All
organizational expenses of the Fund (approximately $56,000), primarily legal
fees and certain Blue Sky registration fees have been paid by The Torray
Corporation and will not be reimbursed by the Fund. The following is a summary
of accounting policies followed by the Fund in the preparation of its financial
statements.
SECURITIES VALUATION Short-term obligations having remaining maturities of
60 days or less are valued at amortized cost, which approximates market value.
Portfolio securities for which market quotations are readily available are
valued at market value, which is determined by using the last reported sale
price, or, if no sales are reported, the last reported bid price.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the first-in first-out basis. Dividend income is
recorded on the ex-dividend date and interest income, including amortization of
discount on short-term investments, is recorded on the accrual basis.
FEDERAL INCOME TAXES The Fund intends to continue to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income, including any net
realized gain on investments to its shareholders. Therefore, no Federal income
tax provision is required. Cost of securities for tax purposes is substantially
the same as for financial reporting purposes.
NET ASSET VALUE The net asset value per share of the Fund is determined
once on each day that the New York Stock Exchange is open, as of the close of
the Exchange.
13
<PAGE>
THE TORRAY FUND
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996 (UNAUDITED)
NOTE 2 -- MANAGEMENT CONTRACT, TRANSFER AGENT AND SHAREHOLDER SERVICE AGREEMENTS
The Torray Corporation currently guarantees that the overall annual expense
ratio of the Fund will not exceed 1.25% of net assets. This ratio consists of a
1% management fee plus up to 0.25% of net assets covering all other expenses.
Pursuant to the Management Contract, the Fund pays The Torray Corporation a
fee, computed daily and payable quarterly at the annual rate of one percent of
the Fund's daily net assets. The Torray Corporation provides investment advisory
and portfolio management services to the Fund. During the six months ended June
30, 1996, The Torray Fund paid management fees of $308,461 (1% of assets).
Excluding the management fee, other expenses incurred by the Fund during
the six months ended June 30, 1996 totalled $177,557. Due to the current expense
limitation, however, the Torray Corporation reimbursed the Fund $100,265 for
expenses incurred in excess of $77,292 (.25% of assets) for the six months ended
June 30, 1996. A portion of the other expenses ($49,500 of $177,557) represents
fees charged by The Torray Corporation for transfer agent, shareholder, net
asset value accounting and administrative services. Certain officers and
Trustees of the Fund are also officers and/or shareholders of The Torray
Corporation. The remaining other expenses of $128,057 were paid to various
independent agents, service providers, and federal and state agencies. These
expenses include all costs associated with the Fund's operations including
Independent Trustees' fees ($2,000 per annum and $100 for each Board meeting
attended), taxes, dues, fees and expenses of registering and qualifying the Fund
and its shares for distribution, charges of custodians, auditing and legal
expenses, insurance premiums, software licensing and securities pricing fees,
supplies, postage, expenses of issue or redemption of shares, reports to
shareholders and Trustees, expenses of printing and mailing prospectuses, proxy
statements and proxies to existing shareholders, and other miscellaneous
expenses.
NOTE 3 -- PORTFOLIO SECURITIES
Purchases and sales of investment securities, other than short-term
investments, for the six months ended June 30, 1996 aggregated $20,913,175 and
$6,433,329, respectively. Net unrealized appreciation of investments at June 30,
1996 includes aggregate unrealized gains of $16,435,629 and unrealized losses of
$215,855.
14
<PAGE>
THE TORRAY FUND
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996 (UNAUDITED)
NOTE 4 -- SHARES OF BENEFICIAL INTEREST TRANSACTIONS
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
SIX MONTHS YEAR
ENDED ENDED
6/30/96 12/31/95
SHARES AMOUNT SHARES AMOUNT
<S> <C> <C> <C> <C>
Shares issued 1,097,238 $23,060,404 937,270 $17,576,747
Reinvestment of dividends
and distributions 14,099 301,854 55,960 1,054,067
Shares redeemed (523,178) (10,889,777) (168,667) (2,816,458)
588,159 $12,472,481 824,563 $15,814,356
</TABLE>
Officers, Trustees, affiliated persons of The Torray Fund and their
families directly or indirectly control 659,993 shares or 21.2% of the Fund.
15
<PAGE>
This report is not authorized for distribution
to prospective investors unless preceded or
accompanied by a current prospectus.
<PAGE>
INVESTMENT ADVISOR
The Torray Corporation
6610 Rockledge Dr. Suite 450
Bethesda, Maryland 20817
LEGAL COUNSEL
Morgan, Lewis & Bockius LLP
1800 M Street, N.W.
Washington, D.C. 20036
INDEPENDENT AUDITORS
Johnson Lambert & Co.
7500 Old Georgetown Road
Suite 700
Bethesda, Maryland 20814
CUSTODIAN
Rushmore Trust & Savings FSB
4922 Fairmont Avenue
Bethesda, Maryland 20814
TRANSFER AGENT & ADMINISTRATOR
The Torray Corporation
6610 Rockledge Dr. Suite 450
Bethesda, Maryland 20817
<PAGE>
SUITE 450
6610 ROCKLEDGE DRIVE
BETHESDA, MARYLAND 20817
(301) 493-4600
1-800-443-3036
The
TORRAY
FUND
SEMI-ANNUAL REPORT
JUNE 30, 1996
