ASTRA INSTITUTIONAL SECURITIES TRUST, N-30D, 1996-01-09

ASTRA INSTITUTIONAL SECURITIES TRUST
N-30D, 1996-01-09

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ASTRA INSTITUTIONAL ADJUSTABLE U.S. GOVERNMENT SECURITIES PORTFOLIO
PORTFOLIO OF INVESTMENTS AS OF OCTOBER 31, 1995
- ----------------------

<TABLE>
<CAPTION>
Market
Principal Interest Value
Amount Rate* Maturity (Note 2A)
- --------- -------- -------- -------------
<S> <C> <C> <C> <C>
ADJUSTABLE RATE MORTGAGE SECURITIES: 85.5%
U.S. GOVERNMENT AGENCIES: 81.3%
$ 5,186,964 Federal Home Loan Mtge. Corp., Pool 775487 .......... 6.133% 09/01/18 $ 5,164,271
5,618,142 Federal National Mtge. Assoc., Pool 60680 ........... 6.429% 02/01/28 5,628,676
4,895,959 Federal National Mtge. Assoc., Pool 65579 ........... 6.391% 07/01/28 4,905,139
9,096,717 Federal National Mtge. Assoc., Pool 70229 ........... 7.765% 05/01/19 9,386,675
3,582,331 Federal National Mtge. Assoc., Pool 220328 .......... 7.877% 03/01/17 3,707,712
2,374,071 Federal National Mtge. Assoc., Pool 292846 .......... 6.570% 09/01/24 2,423,037
3,989,012 Federal National Mtge. Assoc., Pool 303503 .......... 6.690% 11/01/01 4,032,652
8,562,146 Government National Mtge. Assoc., Pool 8157 ......... 6.500% 03/20/23 8,669,173
8,616,212 Government National Mtge. Assoc., Pool 8288 ......... 6.500% 09/20/23 8,740,070
4,973,171 Government National Mtge. Assoc., Pool 8660 ......... 6.500% 07/20/25 5,032,228
26,511,960 Government National Mtge. Assoc., Pool 8717 ......... 6.000% 10/25/25 26,561,670
9,800,000 Government National Mtge. Assoc., Pool 8720. ........ 6.500% 10/25/25 9,916,375
5,000,000 Government National Mtge. Assoc., Pool 8722 ......... 7.000% 10/01/25 5,109,375
35,500,000 Government National Mtge. Assoc., November TBA ...... 6.500% TBA 35,921,563
5,000,000 Government National Mtge. Assoc., November TBA ...... 7.000% TBA 5,109,375
------------
Total U.S. Government Agencies .................... 140,307,991
------------
SUBORDINATED RESIDENTIAL MORTGAGE SECURITIES: 4.2%
11,675,216 (R)(I)Coast Federal Savings Bank 1991-1 ................... 2.424% 06/01/20 1,364,833
5,193,709 (R) Coast Federal Savings Bank 1991-2, Class B-1 ........ 3.090% 11/25/21 57,707
15,987,737 (R) Paine Webber Acceptance Corp 1991-1, Class B ........ 1.502% 02/21/21 143,138
19,138,236 (R)(I)Ryland Mortgage Securities Corp. 1993-6A, Class C-1 . 7.490% 12/29/31 5,642,526
------------
Total Subordinated Residential Mortgage
Securities 7,208,204
------------
Total Adjustable Rate Mortgage Securities 147,516,195
------------
FIXED RATE MORTGAGE SECURITIES: 7.0%
SUBORDINATED RESIDENTIAL MORTGAGE SECURITIES: 7.0%
7,968,857 (R) Citibank NA Multifamily 1992-1, Class B ............. 8.625% 04/20/00 4,781,314
1,687,100 (R) DLJ Mortgage Acceptance Corp 1992-1, Class B ........ 7.925% 08/01/21 1,555,391
7,764,997 (R) USGI Capital Markets Group Inc, Multi Family
1992-1 ............................................. 8.500% 09/30/07 5,711,341
------------
Total Fixed Rate Mortgage Securities .............. 12,048,046
------------
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
Market
Principal Interest Value
Amount Rate* Maturity (Note 2A)
- --------- -------- -------- -------------
<S> <C> <C> <C> <C>
SHORT-TERM SECURITIES: 17.6%
U.S. GOVERNMENT AGENCY DISCOUNT NOTES: 17.6%
$20,515,000 Federal Home Loan Mtge. Corp. .......................... 5.850% 11/01/95 $20,515,000
10,000,000 Federal Home Loan Mtge. Corp. .......................... 5.640% 11/20/95 9,970,233
------------
Total Short-Term Investments 30,485,233
------------
Total Investments in Securities
(Cost $232,605,884) .............................. 110.1% 190,049,474
Liabilities in Excess of Other Assets--Net ........ (10.1)% (17,457,013)
----- ------------
Total Net Assets .................................. 100.0% $172,592,461
===== ============
- -------------
<FN>

(R) Restricted securities (See Note 3).

(I) Illiquid securities (See Note 3).

* Rates shown are as of October 31, 1995. Interest rates on adjustable rate
mortgage securities reset periodically.

** Cost for Federal income tax purposes is $232,605,884 and net unrealized
depreciation consists of:

Gross Unrealized Appreciation ..................... $ 361,145
Gross Unrealized Depreciation ..................... (42,917,555)
------------
Net Unrealized Depreciation ....................... ($42,556,410)
============
</FN>
</TABLE>

See Notes to Financial Statements

ASTRA INSTITUTIONAL ADJUSTABLE U.S. GOVERNMENT SECURITIES PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1995
- ----------------------
<S> <C>
ASSETS:
Investments in securities at value (identified cost $232,605,884) (Notes 2A and 3) . $ 190,049,474
Cash ............................................................................... 175,828
Receivables:
Interest .......................................................................... 1,356,873
Principal repayments .............................................................. 32,932
Securities sold ................................................................... 28,122,324
Deferred organization expense (net of accumulated amortization of $67,107) (Note 2E) 16,096
Other assets ....................................................................... 19,526
-------------
Total Assets .................................................................... 219,773,053
-------------
LIABILITIES:
Payable for securities purchased ................................................... 46,209,665
Accrued expenses ................................................................... 232,277
Distributions payable to Trusts .................................................... 738,650
-------------
Total Liabilities ............................................................... 47,180,592
NET ASSETS .......................................................................... $ 172,592,461
=============
Net asset value per share ($172,592,461 / 2,198,563 shares) ......................... $ 78.50
=============
At October 31, 1995 the components of net assets were as follows:
Paid-in capital .................................................................... $ 310,164,972
Accumulated net realized loss on investments ....................................... (95,030,989)
Undistributed net investment income ................................................ 14,888
Net unrealized depreciation of investments ......................................... (42,556,410)
-------------
Net Assets ........................................................................ $ 172,592,461
=============

STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1995
- ----------------------

INVESTMENT INCOME:
INCOME:
Interest .......................................................................... $ 22,554,011
-------------
EXPENSES:
Investment management fee (Note 4) ................................................ 1,550,152
Recordkeeping fees ................................................................ 512,856
Professional fees ................................................................. 228,225
Custody fees ...................................................................... 51,260
Miscellaneous ..................................................................... 45,928
Amortization of organization expense (Note 2E) .................................... 15,783
Trustees' fees .................................................................... 7,349
Shareholder servicing costs ....................................................... 6,947
-------------
Total expenses .................................................................. 2,418,500
-------------
Net investment income .......................................................... 20,135,511
-------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on investments .................................................. (62,035,769)
Net change in unrealized depreciation of investments .............................. 10,936,142
-------------
Net loss on investments .......................................................... (51,099,627)
-------------
Net decrease in net assets resulting from operations ............................ $ (30,964,116)
=============
</TABLE>

See Notes to Financial Statements

ASTRA INSTITUTIONAL ADJUSTABLE U.S. GOVERNMENT SECURITIES PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED OCTOBER 31,
- ----------------------
1995 1994
------------ -------------
<S> <C> <C>
OPERATIONS:
Net investment income ..................................................... $ 20,135,511 $ 55,439,118
Net realized loss on investments .......................................... (62,035,769) (36,149,068)
Net change in unrealized depreciation of investments ...................... 10,936,142 (55,270,698)
------------ -------------
Net decrease in net assets resulting from operations ...................... (30,964,116) (35,980,648)

DISTRIBUTIONS TO SHAREHOLDERS:
Distributions from net investment income ($4.828 and $4.786
per share, respectively) ................................................. (16,286,136) (45,148,450)

CAPITAL SHARE TRANSACTIONS:
Net decrease in net assets derived from the net change in
the number of outstanding shares (a) ..................................... (315,510,221) (677,765,844)
------------ -------------
Total decrease in net assets ........................................... (362,760,473) (758,894,942)
Net assets at the beginning of period ...................................... 535,352,934 1,294,247,876
------------ -------------
NET ASSETS at the end of period (including undistributed
net investment income of $14,888 and $-0-, respectively) .................. $172,592,461 $ 535,352,934
============ =============
- ----------
</TABLE>

(a) A summary of capital share transactions is as follows:

<TABLE>
<CAPTION>
Year Ended Year Ended
October 31, 1995 October 31, 1994
--------------------------- ---------------------------
Shares Value Shares Value
---------- ------------- ---------- -------------
<S> <C> <C> <C> <C>
Shares sold ................................... 12,991 $ 1,294,478 155,249 $ 15,049,299
Shares issued in payment of
distributions to shareholders ................ 105,611 8,569,781 257,920 24,531,711
---------- ------------- ---------- -------------
Shares repurchased ............................ (3,958,690) (325,374,480) (7,526,415) (717,346,854)
---------- ------------- ---------- -------------
Net decrease ................................ (3,840,088) $(315,510,221) (7,113,246) $(677,765,844)
========== ============= ========== =============
</TABLE>

See Notes to Financial Statements
35

ASTRA INSTITUTIONAL ADJUSTABLE U.S. GOVERNMENT SECURITIES PORTFOLIO
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- ----------------------
November 27, 1991
(commencement of
Year Ended October 31, operations) to
------------------------------------------- October 31,
1995 1994 1993 1992
------- -------- ------- --------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period ............. $88.650 $ 98.410 $99.600 $100.000
------- -------- ------- --------
Income (loss) from investment
operations--
Net investment income ........................... 5.750(b) 5.890 6.040 7.539
Net realized and unrealized loss
on investments ................................. (11.072)(b) (10.864) (0.601) (0.419)
------- -------- ------- --------
Total from investment
operations ................................... (5.322) (4.974) 5.439 7.120
------- -------- ------- --------
Less distributions--

Distributions from net investment
income ......................................... 4.828 4.786 6.061 7.520
Distributions from paid-in capital -- -- 0.568
------- -------- ------- --------
Total distributions ........................... 4.828 4.786 6.629 7.520
------- -------- ------- --------
Net asset value, end of period ................... $78.500 $ 88.650 $98.410 $ 99.600
======= ======== ======= ========
TOTAL RETURN ..................................... (6.00)% (5.25)% 5.62% 7.80%(a)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in thousands) .................................. $172,592 $535,353 $1,294,248 $1,111,565
Ratio to average net assets--
Expenses ........................................ 0.86% 0.62% 0.61% 0.64%(a)
Net investment income ........................... 7.14% 6.17% 6.66% 7.09%(a)
Portfolio turnover rate .......................... 108% 83% 87% 152%
</TABLE>
- ----------

(a) Annualized.
(b) Based upon average shares outstanding throughout the period.

See Notes to Financial Statements.

<PAGE>

ASTRA INSTITUTIONAL ADJUSTABLE U.S. GOVERNMENT SECURITIES PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 1995
- ------------------

NOTE 1--ORGANIZATION

Astra (formerly Pilgrim) Institutional Securities Trust (the "Company") is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company. The Company was organized as a Massachusetts
Business Trust on September 4, 1991 with an unlimited number of shares of
beneficial interest without par value. The Company offers shares in two
non-diversified series, Astra (formerly Pilgrim) Institutional Adjustable U.S.
Government Securities Portfolio (the "Portfolio") and Astra (formerly Pilgrim)
Institutional Adjustable Rate Securities Portfolio. The Portfolio was structured
to serve as the investment vehicle for five affiliated open-end management
investment companies: Astra (formerly Pilgrim) Adjustable U.S. Government
Securities Trust I, I-A, II, III and IV (collectively, the "Trusts"). The Trusts
invest substantially all of their net assets in the Portfolio, which has the
same investment objective as that of the Trusts.

NOTE 2--SIGNIFICANT ACCOUNTING POLICIES

A. SECURITY VALUATION. A valuation committee of the Board of Trustees is
responsible for establishing security valuation policies, reviewing the
valuation of portfolio securities, monitoring the level of illiquid
securities and reviewing liquidity determinations. The Company considers to
be illiquid all securities which cannot be disposed of within seven days in
the ordinary course of business at approximately the amount at which the
Portfolio values the security. Additionally, interest rate swap contracts,
interest-only and principal-only mortgage backed securities, and special
hazard certificates are treated as illiquid securities in accordance with
Securities and Exchange Commission policy. Liquid securities are valued
primarily using prices provided by independent pricing services which use
prices provided by market-makers or estimates of market values obtained
from yield and other data relating to instruments or securities with
similar characteristics, and secondarily based upon market quotations
and/or other available information. Securities for which reliable market
information or pricing service quotes are not readily available, including
illiquid securities, are valued at fair value as determined in good faith
by, or under procedures established by, the Board of Trustees, which
procedures may include the delegation of certain responsibilities regarding
valuation to Astra (formerly Pilgrim) Management Corporation (the
"Manager"). The Manager reports, as necessary, to the Trustees of the
Company regarding portfolio valuation determinations. Short-term securities
with less than sixty days remaining to maturity when acquired by the
Portfolio will be valued on an amortized cost basis by the Portfolio when
the Board of Trustees has determined that amortized cost is fair value.

B. FEDERAL INCOME TAXES. The Portfolio intends to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies
and to distribute all of its taxable income to its shareholders. Therefore,
no Federal income tax provision is required.

C. SECURITY TRANSACTIONS, INCOME AND DISTRIBUTIONS. As is common in the
industry, security transactions are accounted for on the trade date.
Interest income on adjustable rate mortgage securities is recorded on the
accrual basis at current

<PAGE>

interest rates. Dividends to shareholders from net investment income are
declared daily and paid or reinvested monthly. Discounts and premiums on
debt securities are amortized in accordance with the provisions of the
Internal Revenue Code.

D. INTEREST RATE SWAP CONTRACTS. The Portfolio may enter into interest rate
swap contracts as a hedging technique. Interest rate swap contracts are
marked-to-market daily using market quotations or independent pricing
services. The change in market value is recorded by the Portfolio as an
unrealized gain or loss. Interest income (expense) is accrued daily on the
contract's notional amount and applicable interest rates.

Interest rate swap contracts may expose the Portfolio to risks resulting
from unanticipated movements in interest rates or the failure of the
counterparty to the agreement to perform in accordance with the terms of
the contract.

E. DEFERRED ORGANIZATION EXPENSES. All of the Portfolio's expenses in
connection with its organization are being borne by the Portfolio and will
be amortized on a straight-line basis over a period of five years.

NOTE 3--INVESTMENTS

For the year ended October 31, 1995, the cost of purchases and the proceeds from
sales of investments and principal repayments, excluding short-term securities,
aggregated $279,816,300 and $517,132,104, respectively.

On October 31, 1995, the Portfolio held restricted securities (i.e., securities
which may not be publicly sold without registration under the Federal Securities
Act of 1933 (the "'33 Act") or without an exemption under the '33 Act). The
valuation committee of the Board has reviewed the trading markets for certain of
the Portfolio's restricted securities and has determined that they are liquid
and readily marketable. At October 31, 1995 other restricted securities having a
market value of $7,007,359, representing 4.1% of the Portfolio's net assets have
been determined to be illiquid. On October 31, 1995, and on the acquisition
dates of the restricted securities, there were no market quotations available
for unrestricted securities of the same class. Dates of acquisition and costs of
restricted securities are as follows:

Principal Date(s) of
Amount Acquisition Cost
- --------- --------------- ------------
<S> <C> <C> <C>
$ 7,968,857 Citibank NA Multifamily 1992-1, Class B ........... 03/25/92 $ 6,748,374
11,675,216 Coast Federal Savings Bank 1991-1 ................. 06/27/91 TO 08/02/91 10,494,539
5,193,709 Coast Federal Savings Bank 1991-2, Class B-1 ...... 12/04/91 4,396,398
1,687,100 DLJ Mortgage Acceptance Corp 1992-1,
Class B .......................................... 03/05/92 1,361,846
15,987,737 PaineWebber Mortgage Acceptance Corp
1991-1, Class B .................................. 10/24/91 TO 12/11/91 15,916,334
19,138,236 Ryland Mortgage Securities Corp 1993-6A,
Class C-1 ........................................ 09/01/93 16,927,471
7,764,997 USGI Capital Markets Group Inc, Multi Family
1992-1 ........................................... 09/28/92 6,012,758
-----------
Total restricted securities (Market Value of
$19,256,250 was 11.1% of net assets at
October 31, 1995) ................................ $61,857,720
===========

</TABLE>

<PAGE>

As of October 31, 1995 U.S. Government Securities with a value of $52,657,404
were placed in a separate account at the Custodian Bank to cover certain
purchases of securities made on a delayed delivery basis.

At October 31, 1995 the Portfolio had a capital loss carryforward for Federal
income tax purposes of $95,031,000 of which $6,618,000 expires in 2000,
$4,385,000 in 2001, $25,842,000 in 2002, and $58,186,000 in 2003.

NOTE 4--INVESTMENT MANAGEMENT FEE AND
OTHER TRANSACTIONS WITH AFFILIATES

The Manager provides the Portfolio with investment management and administrative
services under an Investment Management Agreement. The Manager furnishes all
investment advice, office space and salaries of personnel needed by the
Portfolio, except those involved with record-keeping, daily net asset value
calculations, placing orders for the execution of portfolio transactions,
shareholder servicing, and maintaining registration of shares under state
securities laws. As compensation for its services, the Manager is paid monthly a
fee which is equal to the annual rate of 0.55% of the first $500 million of
average daily net assets, 0.50% on net assets from $500 million to $1 billion
and 0.45% on net assets over $1 billion. The Manager has agreed to reimburse the
Portfolio and Trusts to the extent required so that the aggregate expenses do
not exceed the expense limitations applicable to the Portfolio and Trusts under
the securities laws or regulations of those states or jurisdictions in which the
Trusts' shares are registered or qualified for sale. Currently, the most
restrictive of such expense limitations would require the Manager to reimburse
the Portfolio and Trusts to the extent required so that the Portfolio's and
Trusts' expenses, as described above, for any fiscal year do not exceed 2-1/2%
of the first $30 million of average daily net assets, 2% of the next $70 million
of average net assets and 1-1/2% of the remaining average net assets. The amount
of any such required reimbursement is limited to the management fees paid by the
Portfolio to the Manager. Expenses for purposes of this expense limitation
include the management fee, but exclude distribution expenses, brokerage
commissions and fees, taxes, interest and extraordinary expenses such as
litigation, paid or incurred by the Portfolio or Trusts.

Certain officers and trustees of the Company are also officers and/or directors
of the Trusts and the Manager.

NOTE 5--LEGAL MATTERS

Between December 1994 and July 1995, various complaints have been filed by
certain shareholders of Astra Adjustable U.S. Government Securities Trusts I,
I-A, II, III and IV and Astra Adjustable Rate Securities Trusts I, I-A, II, III
and IV (collectively, the "Astra Trusts") in the United States District Court
for the Central District of California and in the Superior Court for the State
of California against the Company and certain of its officers and trustees, the
Astra Trusts and certain of their officers and trustees, Astra Management
Corporation, Astra Fund Distributors Corporation, and, Atlas Holdings Group Inc.
and its principal stockholder and certain of its employees. These complaints
have been consolidated in the United States District Court for the Central
District of California in the matter referred to as "In re Pilgrim Securities
Litigation."

The complaints allege violations of the Securities Act of 1933 and the
Investment Company Act of 1940 relating principally to disclosure concerning
pricing and liquidity of portfolio securities held by the two Portfolios of the
Company. The complaints seek relief measured by the consideration each
shareholder paid for shares of the Astra Trusts with interest thereon, less the
amount of income received thereon, or in the event the shareholder no longer
owns such shares, for damages, plus interest. Management of the Company believes
the complaints are without merit and intents, and has been advised that each of
the other defendants intends, to vigorously defend these actions. The ultimate
outcome of these matters, however, cannot presently be determined and
accordingly the Portfolios have made no provision for any losses which may
result from settlement of these complaints.

<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
- ---------------------

To the Shareholders of Astra Institutional Adjustable
U.S. Government Securities Portfolio and the
Trustees of Astra Institutional Securities Trust
San Diego, California

We have audited the statement of assets and liabilities of Astra (formerly
Pilgrim) Institutional Adjustable U.S. Government Securities Portfolio (a series
of shares Astra (formerly Pilgrim) Institutional Securities Trust), including
the portfolio of investments, as of October 31, 1995, and the related statement
of operations for the year then ended, the statement of changes in net assets
for each of the two years in the period then ended and the financial highlights
for each of the three years in the period then ended and for the period from
November 22, 1991 (commencement of operations) to October 31, 1992. These
financial statements and financial highlights are the responsibility of the
Trust's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.

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 financial highlights referred to
above present fairly, in all material respects, the financial position of the
Astra Institutional Adjustable U.S. Government Securities Portfolio as of
October 31, 1995, and the results of its operations for the year then ended, and
the changes in its net assets for each of the two years in the period then ended
and the financial highlights for each of the three years in the period then
ended and for the period from November 22, 1991 to October 31, 1992, in
conformity with generally accepted accounting principles.

As discussed in Note 5 to the accompanying financial statements, Astra
Institutional Adjustable U.S. Government Securities Portfolio has been named as
a defendant in various complaints alleging violations of the Securities Act of
1933 and the Investment Company Act of 1940 and seeking substantial relief. The
outcome of these matters cannot presently be determined and accordingly no
provision for any losses which may result from settlement of these matters has
been made in the accompanying financial statements.

As discussed in Notes 2A and 3, the financial statements include investments in
subordinated residential and derivative mortgage securities valued at $7,007,359
(representing 4.1% of net assets), which the Board of Trustees of Astra
Institutional Securities Trust has determined are illiquid and whose fair value
is determined under procedures approved by Astra Institutional Securities
Trust's Board of Trustees, in the absence of readily ascertainable market
values. We have reviewed the procedures adopted by the Board of Trustees in
determining fair value and have inspected underlying documentation, and in the
circumstances we believe the procedures are reasonable and the documentation of
those procedures appropriate. However, because the market value of these
securities can only be established by negotiation between parties in a sales
transaction, and because of the uncertainty inherent in the valuation process,
the fair values as determined may differ significantly from the values that
would have been used had a ready market for these securities existed.

TAIT, WELLER & BAKER

Philadelphia, Pennsylvania
December 7, 1995

<PAGE>

ASTRA INSTITUTIONAL ADJUSTABLE RATE SECURITIES PORTFOLIO
PORTFOLIO OF INVESTMENTS AS OF OCTOBER 31, 1995
- ------------
Market
Principal Interest Value
Amount Rate* Maturity (Note 2A)
-------- -------- -------- ---------
<S> <C> <C> <C> <C>
ADJUSTABLE RATE MORTGAGE SECURITIES: 85.5%
U.S. GOVERNMENT AGENCY SECURITIES: 52.2%
$ 2,465,460 Federal Home Loan Mortgage Corporation,
Pool 775572 ...................................... 6.615% 06/01/24 $ 2,480,869
1,989,269 Government National Mortgage Association,
Pool 8660 ........................................ 6.500% 07/20/25 2,012,891
5,076,136 Government National Mortgage Association,
Pool 8685 ........................................ 6.500% 08/20/95 5,136,415
5,000,000 Government National Mortgage Association,
November TBA ..................................... 6.500% TBA 5,059,375
------------
Total U.S. Government Agency Securities ........ 14,689,550
------------
SUBORDINATED RESIDENTIAL MORTGAGE SECURITIES: 33.3%
1,554,415(R) Coast Federal Bank 1991-2, Class B-1 .............. 2.709% 11/25/21 17,271
613,146(R) Paine Webber Mortgage Acceptance Corp. 1991-1,
Class B .......................................... 1.050% 02/21/21 5,490
13,541,388(R)(I) Ryland Mortage Securities Corp 1993-6A, Class C-1 . 7.530% 12/29/31 3,992,408
3,350,527(R)(I) Securitized Asset Sales Inc. 1993-5, Class B-1 .... 8.417% 06/25/23 2,278,358
5,624,635(R)(I) Securitized Asset Sales Inc. 1993-8, Class D ...... 7.599% 12/26/23 3,093,549
------------
Total Subordinated Residential
Mortgage Securities ........................... 9,387,076
------------
Total Adjustable Rate Mortgage Securities ...... 24,076,626
------------

SHORT-TERM SECURITIES: 31.8%
U.S. GOVERNMENT AGENCY DISCOUNT NOTES: 31.8%
6,650,000 Federal Home Loan Mortgage Corporation ............ 5.850% 11/01/95 6,650,000
2,330,000 Federal National Mortgage Association ............. 5.630% 11/21/95 2,322,712
------------
Total Short-Term Securities .................... 8,972,712
------------
Total Investments In Securities
(Cost $46,248,784) ............................... 117.3% 33,049,338
Liabilities in Excess of Other Assets-Net ......... ( 17.3%) (4,882,439)
----- ------------
Total Net Assets .................................. 100.0% $ 28,166,899
===== ============
- ----------
</TABLE>

(R) Restricted securities (See Note 3).
(I) Illiquid securities (See Note 3).
* Rates shown are as of October 31, 1995. Interest rates on adjustable rate
mortgage securities reset periodically.
** Cost for Federal income tax purposes is $46,248,784 and net unrealized
depreciation consists of:

Gross Unrealized Appreciation ........................ $ 43,399
Gross Unrealized Depreciation ........................ (13,242,845)
-----------
Net Unrealized Depreciation .......................... $(13,199,446)
============

See Notes to Financial Statements
37

ASTRA INSTITUTIONAL ADJUSTABLE RATE SECURITIES PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1995
- ------------
<S> <C>
ASSETS:
Investments in securities at value (identified cost $46,248,784) (Notes 2A and 3) ...... $ 33,049,338
Cash ................................................................................... 3,452
Receivables:
Interest .............................................................................. 293,803
Principal repayments .................................................................. 11,826
Deferred organization expense (net of accumulated amortization of $37,181) (Note 2E) ... 9,549
Prepaid expenses ....................................................................... 11,619
-------------
Total Assets ......................................................................... 33,379,587
-------------
LIABILITIES:
Payable for securities purchased ....................................................... 5,072,083
Accrued expenses ....................................................................... 140,605
-------------
Total Liabilities .................................................................... 5,212,688
-------------
NET ASSETS .............................................................................. $ 28,166,899
=============
Net asset value per share ($28,166,899 / 584,020 shares) ................................ $ 48.23
=============
At October 31, 1995 the components of net assets were as follows:
Paid-in capital ........................................................................ $ 142,344,982
Accumulated net realized loss on investments ........................................... (100,978,637)
Net unrealized depreciation of investments ............................................. (13,199,446)
-------------
Net Assets ........................................................................... $ 28,166,899
=============

STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1995

INVESTMENT INCOME:
INCOME:
Interest .............................................................................. $ 9,633,825
-------------
EXPENSES:
Investment management fee (Note 4) .................................................... 629,095
Professional fees ..................................................................... 199,473
Recordkeeping fees .................................................................... 157,850
Custody fees .......................................................................... 39,693
Amortization of organization expense (Note 2E) ........................................ 9,519
Miscellaneous ......................................................................... 8,873
Shareholder servicing costs ........................................................... 7,795
-------------
Total expenses ....................................................................... 1,052,298
-------------
Net investment income ............................................................... 8,581,527
-------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on investments ...................................................... (85,991,915)
Net change in unrealized depreciation of investments .................................. 11,674,390
-------------
Net loss on investments .............................................................. (74,317,525)
-------------
Net decrease in net assets resulting from operations ................................ $ (65,735,998)
=============
</TABLE>

See Notes to Financial Statements

<PAGE>

ASTRA INSTITUTIONAL ADJUSTABLE RATE SECURITIES PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED OCTOBER 31,
- ------------
1995 1994
------------ ------------
<S> <C> <C>
OPERATIONS:
Net investment income ........................................... $ 8,581,527 $ 32,919,997
Net realized loss on investments ................................ (85,991,915) (16,543,911)
Net change in unrealized depreciation of investments ............ 11,674,390 (29,384,149)
------------ ------------
Net decrease in net assets resulting from operations ............ (65,735,998) (13,008,063)

DISTRIBUTIONS TO SHAREHOLDERS:
Distributions from net investment income ($2.545 and $6.040
per share, respectively) ....................................... (4,981,182) (31,490,080)
Distributions from paid-in capital ($0.316 per share) ........... (619,391) --

CAPITAL SHARE TRANSACTIONS:
Net decrease in net assets derived from the net change
in the number of outstanding shares(a) ......................... (234,382,963) (77,417,265)
------------ ------------
Total decrease in net assets ................................. (305,719,534) (121,915,408)
Net assets at the beginning of the period ....................... 333,886,433 455,801,841
------------ ------------
NET ASSETS at the end of the period ............................. $ 28,166,899 $333,886,433
============ ============
</TABLE>

- --------
(a) A summary of capital share transactions is as follows:

Year Ended Year Ended
October 31, 1995 October 31, 1994
----------------------------- --------------------------
Shares Value Shares Value
---------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
Shares sold ...................... 25,199 $ 2,037,744 2,178,149 $ 214,199,679
Shares issued in payment of
distributions to shareholders ... 48,815 3,084,153 98,531 9,503,167
Shares repurchased ............... (3,211,688) (239,504,860) (3,156,985) (301,120,111)
---------- ------------- ---------- -------------
Net decrease .................... (3,137,674) $(234,382,963) (880,305) $ (77,417,265)
========== ============= ========== =============

</TABLE>
See Notes to Financial Statements
39

<PAGE>

ASTRA INSTITUTIONAL ADJUSTABLE RATE SECURITIES PORTFOLIO
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED OCTOBER 31, 1995
- ------------
<S> <C>
INCREASE (DECREASE) IN CASH
CASH FLOWS FROM OPERATING ACTIVITIES:
Interest received ................................................................. $ 12,843,590
Operating expenses paid ........................................................... (1,430,432)
Net proceeds from disposition of short-term investments ........................... 32,787,896
Purchases of portfolio securities ................................................. (53,676,590)
Proceeds from disposition of portfolio securities and interest rate swap contracts 245,983,052
Proceeds from principal paydowns .................................................. 8,086,339
-------------
Net cash provided by operating activities ........................................ 244,593,855
-------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from capital stock sold ................................................. 2,037,744
Payments for capital stock redeemed .............................................. (239,504,860)
Cash dividends paid (a) .......................................................... (3,529,591)
Net decrease in cash overdraft .................................................. (3,593,696)
-------------
Net cash used for financing activities ............................................ (244,590,403)
-------------
Net change in cash ................................................................ 3,452
Cash at beginning of period ....................................................... --
-------------
Cash at end of period ............................................................. $ 3,452
=============
RECONCILIATION OF NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS TO
NET CASH PROVIDED BY OPERATING ACTIVITIES:
Net decrease in net assets resulting from operations ............................. $ (65,735,998)
-------------
Adjustments to reconcile net decrease in net assets from operations to
net cash provided by operating activities:
Decrease in investments in securities .......................................... 311,156,139
Decrease in receivable for securities sold ..................................... 8,481,585
Decrease in receivables for principal paydowns ................................. 21,193
Increase in prepaid expenses ................................................... (11,619)
Decrease in deferred organization expenses ..................................... 9,520
Decrease in accrued expenses ................................................... (376,035)
Decrease in other liabilities .................................................. (138,402)
Decrease in interest receivable ................................................ 4,839,945
Decrease in interest rate swap contracts ....................................... 1,573,361
Decrease in payable for securities purchased ................................... (15,225,834)
-------------
Total adjustments ............................................................ 310,329,853
-------------
Net cash provided by operating activities .................................. $ 244,593,855
=============
- --------
<FN>

(a) Non-cash financing activities included herein consist of reinvestment of
distributions to shareholders of $3,084,153.
</FN>
</TABLE>

See Notes to Financial Statements

<PAGE>

ASTRA INSTITUTIONAL ADJUSTABLE RATE SECURITIES PORTFOLIO
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- ------------
November 22, 1991
(commencement of
Year Ended October 31, operations) to
-------------------------------------- October 31,
1995 1994 1993 1992
------- -------- -------- --------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period ......... $89.710 $ 99.040 $ 99.050 $100.000
------- -------- -------- --------
Income (loss) from investment operations--
Net investment income ....................... 6.049(d) 6.460 7.804 8.606
Net realized and unrealized loss
on investments ............................. (44.668)(d) (9.750) (0.004) (0.950)
------- -------- -------- --------
Total from investment operations .......... (38.619) (3.290) 7.800 7.656
------- -------- -------- --------
Less distributions--
Distributions from net investment
income ..................................... 2.545 6.040 7.810 8.606
Distributions from paid-in capital .......... 0.316 -- -- --
------- -------- -------- --------
Total distributions ....................... 2.861 6.040 7.810 8.606
------- -------- -------- --------
Net asset value, end of period ............... $48.230 $ 89.710 $ 99.040 $ 99.050
======= ======== ======== ========
TOTAL RETURN ................................. (44.04)% (3.56)% 8.14% 8.51%(a)

RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) ..... $28,167 $333,886 $455,802 $156,682

Ratio to average net assets--
Expenses .................................... 1.09% 0.76% 0.76% 0.76%(a)(b)
Net investment income ....................... 8.87% 6.55% 7.61% 9.14%(a)(c)
Portfolio turnover rate ...................... 45% 61% 107% 254%

- ------------
<FN>

(a) Annualized.
(b) Ratio of expenses to average net assets prior to expense waivers was
0.79%(a).
(c) Ratio of net investment income to average net assets prior to expense
waivers was 9.11%(a).
(d) Based upon average shares outstanding throughout the period.
</FN>
</TABLE>

See Notes to Financial Statements
41

<PAGE>

ASTRA INSTITUTIONAL ADJUSTABLE RATE SECURITIES PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 1995
- ------------
NOTE 1--ORGANIZATION

Astra (formerly Pilgrim) Institutional Securities Trust (the "Company") is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company. The Company was organized as a Massachusetts
Business Trust on September 4, 1991 with an unlimited number of shares of
beneficial interest without par value. The Company offers shares in two
non-diversified series, Astra (formerly Pilgrim) Institutional Adjustable Rate
Securities Portfolio (the "Portfolio") and Astra (formerly Pilgrim)
Institutional Adjustable U.S. Government Securities Portfolio. The Portfolio was
structured to serve as the investment vehicle for five affiliated open-end
management investment companies: Astra (formerly Pilgrim) Adjustable Rate
Securities Trust I, I-A, II, III and IV (collectively, the "Trusts"). The Trusts
invest substantially all of their net assets in the Portfolio, which has the
same investment objectives as that of the Trusts.

NOTE 2--SIGNIFICANT ACCOUNTING POLICIES

A. SECURITY VALUATION. valuation committee of the Board of Trustees is
responsible for establishing security valuation policies, reviewing the
valuation of portfolio securities, monitoring the level of illiquid
securities and reviewing liquidity determinations. The Company considers to
be illiquid all securities which cannot be disposed of within seven days in
the ordinary course of business at approximately the amount at which the
Portfolio values the security. Additionally, interest rate swap contracts,
interest-only and principal-only mortgage backed securities, and special
hazard certificates are treated as illiquid securities in accordance with
Securities and Exchange Commission policy. Liquid securities are valued
primarily using prices provided by independent pricing services which use
prices provided by market-markers or estimates of market values obtained
from yield and other data relating to instruments or securities with
similar characteristics, and secondarily based upon market quotation and/or
other available information. Securities for which reliable market
information or pricing service quotes are not readily available, including
illiquid securities, are valued at fair value as determined in good faith
by, or under procedures established by, the Board of Trustees, which
procedures may include the delegation of certain responsibilities regarding
valuation to Astra (formerly Pilgrim) Management Corporation (the
"Manager"). The Manager reports, as necessary, to the Trustees of the
Company regarding portfolio valuation determinations. Short-term securities
with less than sixty days remaining to maturity when acquired by the
Portfolio are valued on an amortized cost basis by the Portfolio when the
Board of Trustees has determined that amortized cost is fair value.

<PAGE>

net investment income are declared daily and paid or reinvested monthly.
Discounts and premiums on debt securities are amortized in accordance with
the provisions of the Internal Revenue Code.

E. DEFERRED ORGANIZATION EXPENSES. All of the Portfolio's expenses in
connection with its organization are being borne by the Portfolio and are
amortized on a straight line basis over a period of five years.

NOTE 3--INVESTMENTS

For the year ended October 31, 1995, the cost of purchases and the proceeds from
sales of investments and principal repayments, excluding short-term securities,
aggregated $38,450,756 and $247,752,582, respectively.

On October 31, 1995, the Portfolio held restricted securities (i.e., securities
which may not be publicly sold without registration under the Federal Securities
Act of 1933 (the "33 Act") or without an exemption under the 33 Act). The
valuation committee of the Board has reviewed the trading markets for certain of
the Portfolio's restricted securities and has determined that they are liquid
and readily marketable. At October 31, 1995 other restricted securities having a
market value of $9,364,315, representing 33.2% of the Portfolio's net assets
have been determined to be illiquid. On October 31, 1995, and on the acquisition
dates of the restricted securities, there were no market quotations available
for unrestricted securities of the same class. Dates of acquisition and costs of
restricted securities are as follows:

PRINCIPAL DATE(S) OF
AMOUNT ACQUISITION COST
---------- --------------- ----------
<S> <C> <C>

$1,554,415 Coast Federal Bank 1991-2 Class B-1 .................. 12/04/91 to 01/16/92 $ 1,313,968
613,146 Paine Webber Mortgage Acceptance Corp
1991-1, Class B .................................... 12/05/91 to 01/01/92 610,922
13,541,388 Ryland Mortgage Securities Corp. 1993-6A,
Class C-1 .......................................... 09/01/93 12,192,505
3,350,527 Securitized Asset Sales Inc. 1993-5,
Class B-1 .......................................... 09/28/93 3,157,158
5,624,635 Securitized Asset Sales Inc. 1993-8,
Class D ........................................... 03/04/94 5,355,368
-----------
Total restricted securities (Market Value of
$9,387,076 was 33.3% of net assets at
October 31, 1995) ................................. $22,629,921
===========
</TABLE>

As of October 31, 1995 U.S. Government Securities with a value of $5,136,415
were placed in a separate account at the Custodian Bank to cover

<PAGE>

certain purchases of securities made on a delayed delivery basis.

At October 31, 1995 the Portfolio had a capital loss carryforward for Federal
income tax purposes of $100,979,000 of which $221,000 expires in 2000,
$3,271,000 in 2001, $15,105,000 in 2002 and $82,382,000 in 2003.

NOTE 4--INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES

The Manager has agreed to reimburse the Portfolio and Trusts to the extent
required so that the aggregate expenses do not exceed the expenses limitations
applicable to the Portfolio and Trust under the securities laws or regulations
of those states or jurisdictions in which the Trusts' shares are registered or
qualified for sale. Currently, the most restrictive of such expense limitations
would require the Manager to reimburse the Portfolio and Trusts to the extent
required so that the Portfolio's and Trusts' expenses, as described above, for
any fiscal year do not exceed 2-1/2% of the first $30 million of average daily
net assets, 2% of the next $70 million of average net assets and 1-1/2% of the
remaining average net assets. The amount of any such required reimbursement is
limited to the management fees paid by the Portfolio to the Manager. Expenses
for purposes of this expense limitation include the management fee, but exclude
distribution expenses, brokerage commissions and fees, taxes, interest and
extraordinary expenses such as litigation, paid or incurred by the Portfolio or
Trusts.

Certain officers and trustees of the Company are also officers and/or
trustees/directors of the Trusts and the Manager.

NOTE 5--LEGAL MATTERS

Between December 1994 and May 1995, various complaints have been filed by
certain shareholders of Astra Adjustable U.S. Government Securities Trusts I,
I-A, II, III and IV and Astra Adjustable Rate Securities Trusts I, I-A, II, III
and IV (collectively, the "Astra Trusts") in the United States District Court
for the Central District of California and in the Superior Court for the State
of California against the Company and certain of its officers and trustees, the
Astra Trusts and certain of their officers and trustees, Astra Management
Corporation, Astra Fund Distributors Corporation, and Atlas Holding Group Inc.
and its principal stockholder and certain of its employees. These complaints
have been consolidated in the United States District Court for the Central
District of California in the matter referred to as "In re Pilgrim Securities
Litigation."

The complaints allege violations of the Securities Act of 1933 and the
Investment Company Act of 1940 relating principally to disclosure concerning
pricing and liquidity of portfolio securities held by the two Portfolios of the
Company. The complaints seek relief measured by the consideration each
shareholder paid for shares of the Astra Trusts with interest thereon, less the
amount of income received thereon, or in the event the shareholder no longer
owns such shares, for damages, plus interest. Management of the Company believes
the complaints are without merit and intends, and has been advised that each of
the other defendants intends, to vigorously defend these actions. The ultimate
outcome of these matters, however, cannot presently be determined and
accordingly the Portfolios

<PAGE>

have made no provision for any losses which may result from settlement of these
complaints.

NOTE 6--SUBSEQUENT EVENT

On December 6, 1995 the Portfolio entered into contracts for the sale of three
subordinated residential mortgage securities which the Valuation Committee of
the Company's Board of Trustees had designated as illiquid (see Note 3). These
securities were carried at fair value of $9,364,315, representing approximately
33.2% of the Portfolio's net assets, as of October 31, 1995. The total
consideration received from these sales was $8,266,676 which was approximately
11.7% less than fair value as of October 31, 1995.

<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
- ------------
To the Shareholders of Astra Institutional Adjustable Rate
Securities Portfolio and the Trustees of Astra Institutional Securities Trust
San Diego, California

We have audited the statement of assets and liabilities of Astra (formerly
Pilgrim) Institutional Adjustable Rate Securities Portfolio (a series of shares
of Astra (formerly Pilgrim) Institutional Securities Trust), including the
portfolio of investments, as of October 31, 1995, and the related statements of
operations and cash flows for the year then ended, the statement of changes in
net assets for each of the two years in the period then ended and the financial
highlights for each of three years in the period then ended and for the period
from November 22, 1991 (commencement of operations) to October 31, 1992. These
financial statements and financial highlights are the responsibility of the
Trust's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements and financial
highlights are free from 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
October 31, 1995 by correspondence with the custodian and brokers. 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 financial highlights referred to
above present fairly, in all material respects, the financial position of Astra
Institutional Adjustable Rate Securities Portfolio as of October 31, 1995, and
the results of its operations and its cash flows for year then ended, the
changes in its net assets for each of the two years in the period then ended and
the financial highlights for each of the three years in the period then ended
and for the period from November 22, 1991 to October 31, 1992, in conformity
with generally accepted accounting principles.

As discussed in Note 5 to the accompanying financial statements Astra
Institutional Adjustable Rate Securities Portfolio has been named as a defendant
in various complaints alleging violations of the Securities Act of 1933 and the
Investment Company Act of 1940 and seeking substantial relief. The outcome of
these matters cannot presently be determined and accordingly no provision for
any losses which may result from settlement of these matters has been made in
the accompanying financial statements.

As discussed in Notes 2A and 3, the financial statements include investments in
subordinated residential mortgage securities valued at $9,364,315 (representing
33.2% of net assets), which the Board of Trustees of Astra Institutional
Securities Trust has determined are illiquid and whose fair value is determined
under procedures approved by Astra Institutional Securities Trust's Board of
Trustees, in the absence of readily ascertainable market values. We have
reviewed the procedures adopted by the Board of Trustees in determining fair
value and have inspected underlying documentation, and in the circumstance we
believe the procedures are reasonable and the documentation of those procedures
appropriate. However, because the market value of these securities can only be
established by negotiation between parties in a sales transaction, and because
of the uncertainty inherent in the valuation process, the fair values as
determined may differ significantly from the values that would have been used
had a ready market for these securities existed.

TAIT, WELLER & BAKER

Philadelphia, Pennsylvania
December 7, 1995