<PAGE>
CONTENTS
1
Letter to Shareholders
- ----------------------
2
Global Funds Discussion
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6
Tax Exempt Funds Discussion
- ----------------------
9
Domestic Funds Discussion
- ----------------------
16
Statements of Assets and Liabilities
- ----------------------
18
Statements of Operations
- ----------------------
20
Statements of Changes in Net Assets
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24
Schedules of Portfolio Investments
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51
Notes to Financial Statements
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64
Financial Highlights
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<PAGE>
(This page has been left blank intentionally.)
<PAGE>
April 30, 1996
Dear Fellow Shareholder:
We at Payden & Rygel know that an integral part of any
investment decision is trust. By choosing our family of
funds you placed your trust in us, and we continue to
earn that trust by delivering on the measurements you
selected -- high quality investment management, low
institutional cost and unparalleled service. We believe
that during the past six months we have delivered on
your expectations. [PHOTO]
JOAN PAYDEN
The management discussion on the following pages will outline the
market conditions that prevailed during this period. The market was
particularly volatile, and our Funds' performance was not immune to
this volatility. However, we believe that your focus, as an investor,
is for the longer term -- you want to know that your financial goals
will be met.
Payden & Rygel is committed to helping you achieve your investment
goals. We are "at your service" for all your investment needs.
Sincerely,
/s/ Joan A. Payden
Joan A. Payden
President and Chairman of the Board
Payden & Rygel Investment Group
<PAGE>
GLOBAL FUNDS
ECONOMIC AND MARKET REVIEW
Over the past six months, interest rates around the world have been
volatile. As a case in point, yields on 5-year German government bonds
initially fell 0.75% in late 1995, rose 0.75% through mid-March and fell
back 0.25% by April 30, 1996. Interest rate swings also occurred in both
the United States and Japan. What has been the cause of many of these
interest rate fluctuations? Several longer term forces have affected the
bond markets of the world and are discussed below.
COMPARISON OF U.S. TREASURY AND GERMAN BOND YIELDS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
5-YEAR U.S. TREASURY 5-YEAR GERMAN BOND
<S> <C> <C>
11/1/95 5.73 5.307
11/2/95 5.679 5.223
11/3/95 5.693 5.218
11/6/95 5.722 5.218
11/7/95 5.758 5.15
11/8/95 5.678 5.127
11/9/95 5.715 5.086
11/10/95 5.751 5.126
11/13/95 5.714 5.115
11/14/95 5.7 5.072
11/15/95 5.766 5.065
11/16/95 5.67 5.078
11/17/95 5.648 5.12
11/20/95 5.648 5.105
11/21/95 5.684 5.167
11/22/95 5.706 5.104
11/23/95 5.706 5.018
11/24/95 5.691 4.98
11/27/95 5.655 4.927
11/28/95 5.662 4.961
11/29/95 5.625 4.939
11/30/95 5.544 4.959
12/1/95 5.485 4.862
12/4/95 5.42 4.844
12/5/95 5.442 4.831
12/6/95 5.478 4.873
12/7/95 5.528 4.916
12/8/95 5.55 4.971
12/11/95 5.521 4.92
12/12/95 5.543 4.904
12/13/95 5.55 4.911
12/14/95 5.542 4.852
12/15/95 5.542 4.751
12/18/95 5.644 4.778
12/19/95 5.564 4.86
12/20/95 5.535 4.832
12/21/95 5.556 4.863
12/22/95 5.512 4.853
12/25/95 5.512 4.852
12/26/95 5.498 4.852
12/27/95 5.468 4.831
12/28/95 5.446 4.792
12/29/95 5.402 4.766
1/1/96 5.386 4.766
1/2/96 5.389 4.702
1/3/96 5.353 4.697
1/4/96 5.389 4.735
1/5/96 5.418 4.689
1/8/96 5.41 4.729
1/9/96 5.41 4.69
1/10/96 5.497 4.617
1/11/96 5.468 4.59
1/12/96 5.395 4.541
1/15/96 5.395 4.468
1/16/96 5.359 4.42
1/17/96 5.286 4.441
1/18/96 5.243 4.446
1/19/96 5.264 4.448
1/22/96 5.329 4.452
1/23/96 5.358 4.56
1/24/96 5.329 4.443
1/25/96 5.416 4.386
1/26/96 5.35 4.572
1/29/96 5.357 4.665
1/30/96 5.321 4.644
1/31/96 5.269 4.552
2/1/96 5.23 4.634
2/2/96 5.237 4.675
2/5/96 5.295 4.871
2/6/96 5.273 4.883
2/7/96 5.266 4.802
2/8/96 5.258 4.761
2/9/96 5.236 4.886
2/12/96 5.164 4.856
2/13/96 5.128 4.814
2/14/96 5.157 4.921
2/15/96 5.214 4.935
2/16/96 5.272 4.877
2/19/96 5.272 5.018
2/20/96 5.521 5.103
2/21/96 5.543 5.217
2/22/96 5.455 5.096
2/23/96 5.514 5.021
2/26/96 5.544 5.178
2/27/96 5.618 5.241
2/28/96 5.7 5.137
2/29/96 5.708 5.139
3/1/96 5.567 5.116
3/4/96 5.507 5.036
3/5/96 5.58 5.011
3/6/96 5.66 5.038
3/7/96 5.696 5.087
3/8/96 6.036 5.084
3/11/96 5.976 5.397
3/12/96 6.021 5.357
3/13/96 6.014 5.357
3/14/96 6.007 5.358
3/15/96 6.165 5.313
3/18/96 6.142 5.368
3/19/96 6.128 5.321
3/20/96 6.03 5.358
3/21/96 5.986 5.209
3/22/96 6.031 5.177
3/25/96 5.972 5.135
3/26/96 5.979 5.123
3/27/96 6.099 5.105
3/28/96 6.175 5.165
3/29/96 6.078 5.202
4/1/96 6.063 5.137
4/2/96 5.996 5.137
4/3/96 6.033 5.137
4/4/96 6.094 5.155
4/5/96 6.095 5.155
4/8/96 6.431 5.155
4/9/96 6.362 5.22
4/10/96 6.408 5.152
4/11/96 6.47 5.2
4/12/96 6.279 5.25
4/15/96 6.226 5.175
4/16/96 6.242 5.167
4/17/96 6.28 5.202
4/18/96 6.35 5.13
4/19/96 6.289 5.11
4/22/96 6.236 5.037
4/23/96 6.275 5.037
4/24/96 6.314 5.047
4/25/96 6.306 5.062
4/26/96 6.269 5.022
4/29/96 6.331 5.032
4/30/96 6.393 5.017
</TABLE>
Much of the focus in Western Europe has been on European Monetary Union
(EMU) and striving toward the goal of a single currency. For EMU to be
successful, the economic policies of all the participating countries must
be more closely aligned. This means that countries which have historically
run large spending deficits (e.g., Sweden and Italy) need to rein in
spending. Bond investors around the world tend to reward countries
exhibiting fiscal restraint by accepting lower interest rates on the debt
of that country. This phenomenon, coupled with a general environment of
low inflation and slow growth, was the primary driving force behind
falling interest rates in Western Europe for most of 1995.
2 Payden & Rygel Investment Group
<PAGE>
Japan, on the other hand, is recovering from a crash in stock and real
estate prices (from their precipitously high levels in the early 1990's)
and dealing with a banking system on the verge of collapse. Additionally,
with the Japanese yen trading at all-time highs against the U.S. dollar,
(80 yen/dollar in April of '95) Japanese exporters were finding it
difficult to find buyers for their goods. With a deflationary environment,
the Bank of Japan was able to bring short-term interest rates down to one
half of one percent! This large-scale easing of monetary policy had the
effect of facilitating a weakening of the Japanese yen and a "shoring up"
of the financial system into 1996. With the Japanese economy on the road
to recovery, bond yields rose slowly over the past six months.
THE U.S. DOLLAR'S REVERSAL VS. THE JAPANESE YEN
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
YEN/$
<S> <C> <C>
12/30/94 99.6
1/2/95 99.6
1/3/95 100.69
1/4/95 101.37
1/5/95 100.9
1/6/95 101.36
1/9/95 99.86
1/10/95 100.11
1/11/95 99.9
1/12/95 98.69
1/13/95 98.55
1/16/95 98.55
1/17/95 99.07
1/18/95 99.67
1/19/95 99.04
1/20/95 99.45
1/23/95 99.63
1/24/95 99.79
1/25/95 99.55
1/26/95 99.38
1/27/95 99.36
1/30/95 98.38
1/31/95 99.67
2/1/95 99.22
2/2/95 99.38
2/3/95 99.8
2/6/95 99.41
2/7/95 99.45
2/8/95 98.93
2/9/95 98.9
2/10/95 98.91
2/13/95 98.69
2/14/95 98.55
2/15/95 98.36
2/16/95 97.44
2/17/95 97.25
2/20/95 97.25
2/21/95 97.14
2/22/95 96.95
2/23/95 96.7
2/24/95 97
2/27/95 97.08
2/28/95 96.7
3/1/95 96.78
3/2/95 95.17
3/3/95 94.1
3/6/95 94.91
3/7/95 89.9
3/8/95 91.45
3/9/95 90.5
3/10/95 91.05
3/13/95 90.85
3/14/95 90.84
3/15/95 89.8
3/16/95 90.22
3/17/95 89.13
3/20/95 89.36
3/21/95 89.1
3/22/95 89
3/23/95 88.15
3/24/95 89
3/27/95 89.45
3/28/95 88.9
3/29/95 88.4
3/30/95 89.6
3/31/95 86.56
4/3/95 86.13
4/4/95 86.2
4/5/95 85.93
4/6/95 85.34
4/7/95 83.68
4/10/95 84
4/11/95 83.58
4/12/95 83.65
4/13/95 83.5
4/14/95 83.3
4/17/95 83.06
4/18/95 80.63
4/19/95 81.3
4/20/95 83.11
4/21/95 82.7
4/24/95 83.03
4/25/95 81.95
4/26/95 83.73
4/27/95 83.7
4/28/95 84.2
5/1/95 83.5
5/2/95 83.55
5/3/95 83.6
5/4/95 83.92
5/5/95 83.95
5/8/95 83.35
5/9/95 83.45
5/10/95 83.86
5/11/95 85.65
5/12/95 86.7
5/15/95 86.35
5/16/95 86.65
5/17/95 86.85
5/18/95 87.02
5/19/95 86.85
5/22/95 87.27
5/23/95 87.18
5/24/95 87.24
5/25/95 84.85
5/26/95 82.66
5/29/95 82.66
5/30/95 82.82
5/31/95 84.55
6/1/95 84.8
6/2/95 84.35
6/5/95 84.9
6/6/95 84.65
6/7/95 84.71
6/8/95 84.75
6/9/95 84.54
6/12/95 84.05
6/13/95 84.6
6/14/95 84.4
6/15/95 84.48
6/16/95 84.75
6/19/95 84.65
6/20/95 84.45
6/21/95 84.1
6/22/95 84.55
6/23/95 84.3
6/26/95 84.38
6/27/95 84.24
6/28/95 84.6
6/29/95 84.48
6/30/95 84.71
7/3/95 84.78
7/4/95 84.78
7/5/95 84.86
7/6/95 85.04
7/7/95 86.75
7/10/95 86.9
7/11/95 87.55
7/12/95 87.4
7/13/95 87.43
7/14/95 87.78
7/17/95 88.84
7/18/95 88.25
7/19/95 87.32
7/20/95 88.17
7/21/95 88.48
7/24/95 87.45
7/25/95 87.65
7/26/95 87.85
7/27/95 88.03
7/28/95 88.1
7/31/95 88.4
8/1/95 88.05
8/2/95 90.97
8/3/95 90.5
8/4/95 91.4
8/7/95 91.35
8/8/95 91.45
8/9/95 91.61
8/10/95 92.83
8/11/95 93.86
8/14/95 93.6
8/15/95 96.75
8/16/95 97.75
8/17/95 97.05
8/18/95 97.4
8/21/95 96.9
8/22/95 96.85
8/23/95 96.58
8/24/95 96.53
8/25/95 96.7
8/28/95 96.68
8/29/95 98
8/30/95 99
8/31/95 97.34
9/1/95 97.47
9/4/95 97.47
9/5/95 97.47
9/6/95 98.7
9/7/95 98.96
9/8/95 99.65
9/11/95 99.95
9/12/95 101.13
9/13/95 102.74
9/14/95 102.45
9/15/95 104.07
9/18/95 103.35
9/19/95 104.45
9/20/95 102.65
9/21/95 98.95
9/22/95 100.05
9/25/95 100.51
9/26/95 100.97
9/27/95 100.4
9/28/95 99.35
9/29/95 99.73
10/2/95 100.39
10/3/95 101.38
10/4/95 101.03
10/5/95 99.4
10/6/95 100.55
10/9/95 100.55
10/10/95 100.67
10/11/95 101
10/12/95 100.15
10/13/95 100.98
10/16/95 100.58
10/17/95 100.27
10/18/95 100.8
10/19/95 100.35
10/20/95 100.36
10/23/95 99.83
10/24/95 100.45
10/25/95 101.15
10/26/95 101.3
10/27/95 101.75
10/30/95 101.97
10/31/95 101.95
11/1/95 103.23
11/2/95 104.01
11/3/95 103.9
11/6/95 103.33
11/7/95 103.07
11/8/95 102.55
11/9/95 100.4
11/10/95 100.86
11/13/95 101.95
11/14/95 101.65
11/15/95 101.46
11/16/95 102.08
11/17/95 102.03
11/20/95 101.2
11/21/95 101.45
11/22/95 100.95
11/23/95 100.95
11/24/95 101.56
11/27/95 101.75
11/28/95 101.3
11/29/95 101.6
11/30/95 102.05
12/1/95 101.2
12/4/95 101.37
12/5/95 101.25
12/6/95 101.37
12/7/95 101.42
12/8/95 101.28
12/11/95 101.15
12/12/95 101.8
12/13/95 101.65
12/14/95 101.55
12/15/95 102
12/18/95 101.67
12/19/95 102
12/20/95 101.73
12/21/95 101.83
12/22/95 102.3
12/25/95 102.3
12/26/95 102.3
12/27/95 102.85
12/28/95 102.73
12/29/95 103.43
1/1/96 103.43
1/2/96 103.93
1/3/96 104.87
1/4/96 105.25
1/5/96 105.32
1/8/96 105.18
1/9/96 104.53
1/10/96 104.93
1/11/96 104.8
1/12/96 105.31
1/15/96 105.3
1/16/96 105.92
1/17/96 105.55
1/18/96 105.61
1/19/96 105.38
1/22/96 105.78
1/23/96 105.65
1/24/96 107.08
1/25/96 106.91
1/26/96 106.69
1/29/96 106.78
1/30/96 107.27
1/31/96 107.05
2/1/96 106.75
2/2/96 106.45
2/5/96 105.18
2/6/96 105.18
2/7/96 105.95
2/8/96 107.03
2/9/96 107.08
2/12/96 106.83
2/13/96 106.87
2/14/96 106.27 U.S. Dollar Strengthens
2/15/96 105.53
2/16/96 105.2
2/19/96 105.2
2/20/96 105.68
2/21/96 104.9
2/22/96 105.1
2/23/96 104.8
2/26/96 104.3
2/27/96 104.28
2/28/96 104.58
2/29/96 105.28
3/1/96 105.46
3/4/96 105.26
3/5/96 105.24
3/6/96 105.43
3/7/96 105.32
3/8/96 105.8
3/11/96 105.45
3/12/96 105.23
3/13/96 105.18
3/14/96 105.56
3/15/96 105.87
3/18/96 106.05
3/19/96 106.19
3/20/96 106.4
3/21/96 106.89
3/22/96 106.85
3/25/96 106.2
3/26/96 106.55
3/27/96 106.55
3/28/96 106.25
3/29/96 107.28
4/1/96 107.59
4/2/96 107.62
4/3/96 106.9
4/4/96 107.04
4/5/96 107.6
4/8/96 107.68
4/9/96 108.32
4/10/96 108.44
4/11/96 108.45
4/12/96 108.57
4/15/96 108.59
4/16/96 108.15
4/17/96 108.31
4/18/96 106.71
4/19/96 107.3
4/22/96 106.63
4/23/96 106.67
4/24/96 106.53
4/25/96 106.75
4/26/96 105.65
4/29/96 104.75
4/30/96 105.07
</TABLE>
As we entered 1996, commodity prices began to rise (oil hit nearly $25 a
barrel) and there were hints that the economy was picking up steam; bond
yields in the U.S. began to rise. When the Labor Department released the
February employment report showing that the economy added 631,000 new
jobs, the U.S. bond market began a protracted sell-off, which, in turn,
negatively affected many of the major bond markets around the world.
Semi-Annual Report 3
<PAGE>
FUND STRATEGIES AND PERFORMANCE
With the significant rally in worldwide bonds in 1995, the Global Fixed
Income Fund returned 17.97% for the year. As 1996 began, we restructured
and lowered our allocation to U.S. bonds and increased the exposure to
Western Europe (e.g. Germany, Denmark and Sweden). Despite the worldwide
sell-off in bonds, Western Europe outperformed the U.S. on a total return
basis.
Over the past six months, the U.S. dollar appreciated in value against
most of the major currencies of the world. As a foreign currency weakens
in value, the underlying bond is also negatively impacted (it now takes
more of the foreign currency to buy the same amount of U.S. dollars).
Hedging strategies (such as selling a foreign currency forward) can help
mitigate the devaluing effect of a strengthening U.S. dollar. Both the
Global Fixed Income Fund and the International Bond Fund had protection
from the appreciation of the dollar by having a significant percentage of
the currency hedged.
LOOKING FORWARD
As we look forward to the rest of 1996, we see the focus in Western Europe
remaining on the goal of achieving monetary union. With European economies
growing at a slow rate, we anticipate continued interest rate cuts by
Central Banks. The Japanese economy appears to have the worst behind it,
which should enable the Bank of Japan to begin tightening monetary policy
by slowly raising short-term interest rates. In the United States, we
expect inflation to remain contained and growth to be moderate over the
course of the year, which should provide an attractive environment for
bonds.
4 Payden & Rygel Investment Group
<PAGE>
GLOBAL FUNDS PORTFOLIO HIGHLIGHTS
GLOBAL FIXED INCOME FUND
<TABLE>
<CAPTION>
April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $665,195,419 $540,040,901
Number of Issues: 21 20
Average Maturity: 8.4 years 6.7 years
SEC Yield: 5.94% 5.85%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Country Allocation Percent
<S> <C>
U.S. 30%
Germany 30%
Canada 10%
Denmark 10%
Japan 5%
Sweden 5%
Netherlands 5%
U.K. 5%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Maturity Composition
<S> <C>
Germany 12.4 years
Netherlands 9.7 years
Canada 9.0 years
U.S. 7.5 years
Japan 6.8 years
Denmark 5.6 years
U.K. 4.6 years
Sweden 2.7 years
</TABLE>
INTERNATIONAL BOND FUND
<TABLE>
<CAPTION>
April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $19,584,746 $19,194,287
Number of Issues: 24 28
Average Maturity: 9.3 years 6.8 years
SEC Yield: 5.88% 5.54%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Country Allocation
<S> <C>
Germany 33%
Japan 12%
Denmark 10%
Canada 9%
Sweden 7%
Spain 7%
U.K. 7%
Austria 5%
Ireland 5%
Netherlands 5%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Maturity Composition
<S> <C>
Germany 12.9 years
Canada 9.5 years
Austria 9.2 years
Netherlands 8.8 years
Ireland 8.5 years
Denmark 8.2 years
Japan 7.3 years
Sweden 6.2 years
U.K. 5.8 years
Spain 5.5 years
</TABLE>
Note: Past performance is not predictive of future performance. This information
is not part of the financial statements.
Semi-Annual Report 5
<PAGE>
TAX EXEMPT FUNDS
ECONOMIC AND MARKET REVIEW
During the six months ended April 30, 1996, interest rates moved higher,
prompted by news reflecting a pick-up in first-quarter 1996 economic
activity. Through the first three months of the fiscal year, the Federal
Reserve eased short-term interest rates twice: once in December and then
again in January. These moves were anticipated by the market and received
positively. Beginning in February, however, economic statistics were
reported that began to worry investors. The fear of an increase in
inflation caused by stronger than expected employment growth led to a rise
in interest rates. While municipal bond yields rose during the six months,
they rose less than treasury yields.
MUNICIPAL AND U.S. TREASURY YIELD CHANGE
NOVEMBER 1995 - APRIL 1996
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
YIELD CHANGE (%)
YEARS TO MATURITY U.S. Treasury Municipal
<S> <C> <C>
1 yr 0.16% 0.01%
2 yr 0.51% 0.15%
3 yr 0.60% 0.21%
4 yr 0.64% 0.24%
5 yr 0.67% 0.29%
7 yr 0.68% 0.31%
10 yr 0.70% 0.31%
15 yr 0.67% 0.25%
20 yr 0.65% 0.21%
25 yr 0.62% 0.17%
30 yr 0.60% 0.17%
</TABLE>
During this time, the municipal market performed well for several reasons.
Increased demand from property and casualty insurance companies and
attractive values in the long end of the municipal market helped cushion
municipal bond
6 Payden & Rygel Investment Group
<PAGE>
prices from the dramatic yield increases seen in the Treasury market. This
increased demand, coupled with a diminishing prospect for radical tax
reform, helped municipal bonds outperform other fixed income alternatives.
FUND STRATEGIES AND PERFORMANCE
We began the fiscal year with the belief that the economy would expand
modestly, inflation would not accelerate and the Federal Reserve would
continue in its accommodative monetary policy. The Funds were positioned
in keeping with our interest rate views. Our focus in the Funds over the
past several months has been on increasing the allocation to non-callable
bonds and buying higher coupon instruments. This strategy maintains the
price responsiveness of the portfolio while providing a yield cushion,
should interest rates continue to rise. The Tax Exempt Bond Fund returned
0.49% during the six months, and the Short Duration Tax Exempt Fund had a
1.19% return.
LOOKING FORWARD
While we are concerned with the yield volatility in the marketplace, we
remain constructive on the municipal bond market. We continue to focus on
high quality, liquid issues that should provide attractive returns in a
positive interest rate environment. Several technical factors in the
municipal market provide support for prices in the coming months. Supply
from new-money financings as well as refunding issues should remain
modest, and this should help support the market. Many deals that had been
scheduled to be brought to market this year were delayed or postponed due
to the increase in interest rates. The large redemption period during June
and July also should support the municipal market, as investors, whose
portfolios have shortened in maturity, reinvest their proceeds. We believe
that reduced fear of tax reform will cause investors to find attractive
values in municipal bonds.
Election year politics will come to the fore during the next several
months and could have an impact on the markets. The political conventions
in the late summer will provide additional material for the markets to
digest, both with regard to reducing the budget deficit, as well as tax
issues. We do not believe that a tax bill will be passed this year in
Congress, and do not believe that radical tax reform will be a strong
portion of either Party's platform as we approach the Presidential
elections. The elections in Congress will be interesting to watch as the
many seats to be decided include 42 that have been vacated by incumbents
who decided not to run again. The impact this will have on the markets is
unknown at this time.
Semi-Annual Report 7
<PAGE>
TAX EXEMPT FUNDS PORTFOLIO HIGHLIGHTS
SHORT DURATION TAX EXEMPT FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $25,042,761 $16,018,618
Number of Issues: 32 24
Average Maturity: 2.9 years 3.5 years
SEC Yield: 4.03% 3.80%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Credit Quality
<S> <C>
AAA 33%
AA 34%
A 28%
Baa 5%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Portfolio Composition
<S> <C>
General Obligation 23%
Revenue Bonds 47%
Pre-refunded Bonds 3%
Insured Bonds 27%
</TABLE>
TAX EXEMPT BOND FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $54,008,237 $40,051,668
Number of Issues: 49 43
Average Maturity: 9.5 years 9.4 years
SEC Yield: 4.83% 4.75%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Credit Quality
<S> <C>
AAA 49%
AA 35%
A 14%
Baa 2%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Portfolio Composition
<S> <C>
General Obligation 29%
Revenue Bonds 29%
Pre-refunded Bonds 7%
Insured Bonds 35%
</TABLE>
Note: Past performance is not predictive of future performance. This information
is not part of the financial statements.
8 Payden & Rygel Investment Group
<PAGE>
DOMESTIC FUNDS
ECONOMIC AND MARKET REVIEW
The U.S fixed income markets have undergone a shift in interest rate
expectations over the past six months. Earlier this year, the consensus
opinion for future interest rates was for a continued gradual decline in
rates. However, over the past three months interest rates have risen back
to levels last seen in early 1995.
10 YEAR TREASURY YIELD
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
YIELD (%)
<S> <C>
Apr '95 7.05
May 6.28
Jun 6.2
Jul 6.42
Aug 6.28
Sep 6.18
Oct 6.02
Nov 5.74
Dec 5.57
Jan '96 5.58
Feb 6.1
Mar 6.33
Apr 6.7
</TABLE>
In late 1995 and early 1996, interest rates were driven lower due to
modest economic growth assumptions and a benign inflation environment. The
Federal Reserve did nothing to discourage those expectations, by easing
the Federal Funds rate from 5.75% to 5.50% in December 1995 and another
1/4% to 5.25% in January 1996. Economic activity was expected to slow
further due to the blizzard conditions on the east coast and curtailed
government spending arising from the failed federal budget negotiations.
The fixed income markets were buoyant in their belief of further cuts in
interest rates. Yields fell to lows of 6.0% on the 30-year bond and 4.8%
on the 2-year Treasury note.
Semi-Annual Report 9
<PAGE>
The watershed event which changed investor sentiment from lower interest
rates to higher interest rates was the February labor report. The report
portrayed new job creation sharply higher than forecast and signaled an
increase in the pace of economic activity.
MONTHLY PAYROLL CHANGE
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
EMPLOYMENT (THOUSANDS)
<S> <C>
Jan '95 186
Feb 313
Mar 179
Apr 8
May -62
Jun 299
Jul 28
Aug 263
Sep 94
Oct 68
Nov 212
Dec 145
Jan '96 -146
Feb 631
Mar 178
Apr 2
</TABLE>
The perceived strength in the economy contradicted investors' belief that
the economy would continue on a path of modest growth. The fixed income
market, mindful of Federal Reserve Chairman Alan Greenspan's past history
of raising interest rates to ward off inflationary threats, quickly
established higher yield levels. The market move was an effort to reflect
a risk profile more in line with a neutral-to-tighter Federal Reserve
policy than that of the easy monetary policy which prevailed in early
1996. The first quarter Gross Domestic Product reported at 2.3% was also
higher than expectations and further reinforced expectations of economic
pickup exhibited in the labor report.
The U.S. stock market, which generally has difficulty during periods of
rising interest rates, continued to perform well. The S&P 500 Index rose
12.5% during the period while the technology-driven NASDAQ Composite Index
rose an even stronger 14.9%. Investor demand for equities seems insatiable
as $99 billion was invested in equity mutual funds during the first four
months of 1996. In addition to high demand, equity prices were aided by
stock buy-back programs which were commenced by many large companies.
10 Payden & Rygel Investment Group
<PAGE>
FUND STRATEGIES AND PERFORMANCE
Rising interest rate environments are never easy for fixed income
investors. Unless an investor happens to have all of his money in
securities with very short maturity dates, price depreciation will occur
when interest rates rise. To offset falling bond prices, the Funds
purchased higher yielding mortgage and corporate securities. The higher
yields that mortgage and corporate securities offer provide some relief to
the drop in fixed income securities' prices.
Payden and Rygel's approach to corporate and mortgage investing has always
been to participate in high-quality names, where liquidity and quality are
not sacrificed for the sake of moderate increases in yield. In the
corporate sector, investment has focused on high-quality issues rated
single-A or higher by both Moody's and Standard & Poor's. Currently, the
marketplace offers little additional yield for lower quality corporate
issues. The mortgage market has been the beneficiary of rising interest
rates due to the decreased likelihood of homeowners prepaying their
existing mortgages early. Investments in government agency backed mortgage
securities with current coupons have increased the yield to the Funds
without significant risk of early prepayment by homeowners.
The Market Return Fund was also affected by rising interest rates. The
Fund's fixed income assets fell in value as interest rates rose, causing
the Fund to underperform the S&P 500 Stock Index. For the five months from
the Fund's inception through the end of April, the Fund earned 3.55%
versus 8.98% for the Index. However, five months is a very short time
period. When the fixed income market returns to a period of stability or
price appreciation, we believe the Market Return Fund will have a greater
opportunity to meet its objective of exceeding the return of the S&P 500
Stock Index.
Semi-Annual Report 11
<PAGE>
LOOKING FORWARD
Based on historical averages, the current market environment offers
opportunity for investors given the high real interest rate levels
(nominal interest rates minus the rate of inflation) offered in the
marketplace. Inflation has remained at or below 3.0% for close to three
years.
ANNUALIZED CHANGE IN CPI
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PERCENT (%)
<S> <C>
May-92 3
Jun-92 3.1
Jul-92 3.2
Aug-92 3.1
Sep-92 3
Oct-92 3.2
Nov-92 3
Dec-92 2.9
Jan-93 3.3
Feb-93 3.2
Mar-93 3.1
Apr-93 3.2
May-93 3.2
Jun-93 3
Jul-93 2.8
Aug-93 2.8
Sep-93 2.7
Oct-93 2.8
Nov-93 2.7
Dec-93 2.7
Jan-94 2.5
Feb-94 2.5
Mar-94 2.5
Apr-94 2.4
May-94 2.3
Jun-94 2.5
Jul-94 2.8
Aug-94 2.9
Sep-94 3
Oct-94 2.6
Nov-94 2.7
Dec-94 2.7
Jan-95 2.8
Feb-95 2.9
Mar-95 2.9
Apr-95 3.1
May-95 3.2
Jun-95 3
Jul-95 2.8
Aug-95 2.6
Sep-95 2.5
Oct-95 2.8
Nov-95 2.6
Dec-95 2.5
Jan-96 2.7
Feb-96 2.7
Mar-96 2.8
Apr-96 2.9
</TABLE>
The fundamentals for a low inflation environment continue to exist.
Dynamics such as business competition in the global marketplace,
efficiencies and productivity gains from technology, and changing consumer
buying patterns, all support a foundation for continued low inflation. The
past six months have shown only that market EXPECTATIONS regarding future
inflation may have changed but FUNDAMENTALLY, the dynamics still imply a
relatively benign environment. The rise in rates over the past few months
should further act to temper economic growth and reemphasize the positive
inflationary picture. Although we have an inherent belief in the dynamics
holding inflation in check, changing market expectations often increase
volatility. Investors will need patience in order to reap the benefits of
today's higher yields.
12 Payden & Rygel Investment Group
<PAGE>
DOMESTIC FUNDS PORTFOLIO HIGHLIGHTS
LIMITED MATURITY FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $38,791,517 $18,414,303
Number of Issues: 24 23
Average Maturity: 0.7 years 0.7 years
SEC Yield: 5.79% 5.52%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Credit Quality
<S> <C>
AAA 74%
AA 7%
A 19%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Portfolio Composition
<S> <C>
Treasury/Agency 70%
Corporate 23%
Asset Backed 4%
Commercial Paper 3%
</TABLE>
SHORT BOND FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $36,622,187 $19,156,786
Number of Issues: 38 27
Average Maturity: 2.8 years 2.6 years
SEC Yield: 5.97% 5.62%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Credit Quality
<S> <C>
AAA 75%
AA 7%
A 18%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Portfolio Composition
<S> <C>
Treasury/Agency 63%
Corporate 23%
Asset Backed 8%
Mortgage Backed 3%
Commercial Paper 3%
</TABLE>
Note: Past performance is not predictive of future performance. This information
is not part of the financial statements.
Semi-Annual Report 13
<PAGE>
DOMESTIC FUNDS PORTFOLIO HIGHLIGHTS
INTERMEDIATE BOND FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $32,353,241 $34,390,923
Number of Issues: 24 28
Average Maturity: 4.8 years 5.9 years
SEC Yield: 6.35% 5.93%
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
</TABLE>
<TABLE>
Credit Quality
<S> <C>
AAA 59%
AA 3%
A 38%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Portfolio Composition
<S> <C>
Corporate 41%
Treasury/Agency 37%
Mortgage Backed 14%
Asset Backed 8%
</TABLE>
OPPORTUNITY FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $31,007,190 $25,821,911
Number of Issues: 39 32
Average Maturity: 8.5 years 9.5 years
SEC Yield: 6.48% 5.91%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Credit Quality
<S> <C>
AAA 68%
AA 5%
A 27%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Portfolio Composition
<S> <C>
Treasury/Agency 48%
Corporate 32%
Mortgage Backed 16%
Commercial Paper 3%
Asset Backed 1%
</TABLE>
Note: Past performance is not predictive of future performance. This information
is not part of the financial statements.
14 Payden & Rygel Investment Group
<PAGE>
DOMESTIC FUNDS PORTFOLIO HIGHLIGHTS
U.S. TREASURY FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $17,095,615 $10,894,268
Number of Issues: 14 13
Average Maturity: 4.8 years 4.9 years
SEC Yield: 5.95% 5.60%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Credit Quality
<S> <C>
AAA 100%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Portfolio Composition
<S> <C>
AAA 100%
</TABLE>
MARKET RETURN FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION> April 30, 1996 October 31, 1995
<S> <C> <C>
Net Assets: $3,119,355 N/A
Number of Issues: 17 N/A
Average Maturity: 6.6 years N/A
SEC Yield: 6.31% N/A
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Equity Exposure
<S> <C>
S&P Futures 97%
S&P Depositary Receipts 3%
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
Portfolio Composition
<S> <C>
Treasury/Agency 65%
Corporate 16%
Mortgage Backed 16%
S&P Depositary Receipts 3%
</TABLE>
Note: Past performance is not predictive of future performance. This information
is not part of the financial statements.
Semi-Annual Report 15
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
GLOBAL INTERNATIONAL SHORT DURATION
FIXED INCOME BOND TAX EXEMPT
FUND FUND FUND
-------------- ---------------- --------------
-------------- ---------------- --------------
<S> <C> <C> <C
ASSETS:
Investments, at value*................................................ $640,770,470 $ 18,921,583 $ 26,673,699
Interest receivable................................................... 14,484,767 544,051 395,067
Open forward currency contracts....................................... 9,568,601 126,496
Closed forward currency contracts..................................... 1,312,340 56,007
Receivable for investments sold.......................................
Receivable for fund shares sold.......................................
Unamortized organization costs (Note 4)............................... 24,388 4,193 3,657
Deferred expense subsidy (Note 5)..................................... 98,688 151,538
Other assets.......................................................... 46,929 1,993 956
-------------- ---------------- --------------
Total Assets...................................................... 666,207,495 19,753,011 27,224,917
-------------- ---------------- --------------
LIABILITIES:
Open forward currency contacts........................................ 202,350 49,663
Closed forward currency contracts..................................... 574
Payable for investments purchased..................................... 2,011,980
Payable for open futures contracts.................................... 4,500
Payable for fund shares redeemed...................................... 500,000
Payable to Payden & Rygel (Note 5).................................... 27,265 43,635
Accrued expenses:
Investment advisory fees............................................ 171,284 62,267 88,426
Administration fees................................................. 32,725 3,947 4,920
Other expenses...................................................... 105,717 24,549 28,695
Other liabilities.....................................................
-------------- ---------------- --------------
Total Liabilities................................................. 1,012,076 168,265 2,182,156
-------------- ---------------- --------------
NET ASSETS........................................................ 665,195,419 19,584,746 25,042,761
-------------- ---------------- --------------
-------------- ---------------- --------------
NET ASSETS:
Paid in capital....................................................... 677,523,935 20,168,598 25,110,229
Undistributed net investment income................................... 2,340,045 437,761 10,451
Accumulated net realized gains (losses) from:
Investments......................................................... (1,627,705) (341,541) 83,655
Foreign currency transactions....................................... 8,068,851 (90,313)
Futures contracts................................................... (84,068)
Net unrealized appreciation (depreciation) from:
Investments......................................................... (30,153,468) (649,617) (64,068)
Translation of assets and liabilities in foreign
currencies......................................................... 9,043,761 59,858
Open futures contracts.............................................. (13,438)
-------------- ---------------- --------------
NET ASSETS........................................................ $665,195,419 $ 19,584,746 $ 25,042,761
-------------- ---------------- --------------
-------------- ---------------- --------------
Outstanding shares of beneficial interest............................. 66,165,511 1,988,989 2,506,600
-------------- ---------------- --------------
-------------- ---------------- --------------
NET ASSET VALUE -- offering and redemption price per share............ $ 10.05 $ 9.85 $ 9.99
-------------- ---------------- --------------
-------------- ---------------- --------------
- ---------
*Investments, at cost................................................. $670,923,938 $ 19,571,200 $ 26,737,767
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
16 Payden & Rygel Investment Group
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
TAX EXEMPT U.S. LIMITED SHORT
BOND TREASURY MATURITY BOND
FUND FUND FUND FUND
--------------- --------------- --------------- ---------------
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
ASSETS:
Investments, at value*............................... $53,256,391 $16,615,909 $36,530,234 $39,065,521
Interest receivable.................................. 841,625 287,446 465,468 559,141
Open forward currency contracts......................
Closed forward currency contracts....................
Receivable for investments sold...................... 1,500,000 1,021,630
Receivable for fund shares sold...................... 200,000 3,000,000 10,000
Unamortized organization costs (Note 4).............. 8,106 2,719 1,057
Deferred expense subsidy (Note 5).................... 226,745 111,886 187,347 169,176
Other assets......................................... 7,173 2,219 3,536 5,054
--------------- --------------- --------------- ---------------
TOTAL ASSETS.................................... 55,840,040 17,220,179 41,209,272 39,808,892
--------------- --------------- --------------- ---------------
LIABILITIES:
Open forward currency contracts......................
Closed forward currency contracts....................
Payable for investments purchased.................... 1,536,075
Payable for open futures contracts................... 27,913
Payable for funds shares redeemed.................... 1,900,000 3,000,000
Payable to Payden & Rygel (Note 5)................... 8,584 56,027 90,994 88,408
Accrued expenses:
Investment advisory fees......................... 218,018 36,505 79,400 65,244
Administration fees.............................. 10,158 3,615 4,679 5,225
Other expenses................................... 29,222 28,417 25,651 27,828
Other liabilities.................................... 1,833 317,031
--------------- --------------- --------------- ---------------
Total liabilities.............................. 1,831,803 124,564 2,417,755 3,186,705
--------------- --------------- --------------- ---------------
NET ASSETS..................................... 54,008,237 17,095,615 38,791,517 36,622,187
--------------- --------------- --------------- ---------------
--------------- --------------- --------------- ---------------
NET ASSETS:
Paid in capital...................................... 55,182,229 17,324,100 38,828,472 36,931,924
Undistributed net investment income.................. 28,102 10,482 21,732 23,260
Accumulated net realized gains (losses) from:
Investments...................................... (1,252,351) 73,254 (31,886) 47,087
Foreign currency transactions....................
Futures contracts................................ 83,540
Net unrealized appreciation (depreciation) from:
Investments...................................... 32,967 (312,221) (26,801) (380,084)
Translation of assets and liabilities in foreign
currencies.....................................
Open futures contracts........................... (66,250)
--------------- --------------- --------------- ---------------
NET ASSETS.................................. $54,008,237 $17,095,615 $38,791,517 $36,622,187
--------------- --------------- --------------- ---------------
--------------- --------------- --------------- ---------------
Outstanding shares of beneficial interest............ 5,734,677 1,656,100 3,867,850 3,694,043
--------------- --------------- --------------- ---------------
--------------- --------------- --------------- ---------------
NET ASSET VALUE - offering and redemption price per
share............................................. $ 9.42 $ 10.32 $ 10.03 $ 9.91
--------------- --------------- --------------- ---------------
--------------- --------------- --------------- ---------------
- ----------
*Investments at cost............................... $53,223,424 $16,928,130 $36,557,035 $39,445,605
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
INTERMEDIATE MARKET
BOND OPPORTUNITY RETURN
FUND FUND FUND
--------------- --------------- ---------------
--------------- --------------- ---------------
<S> <C> <C> <C>
ASSETS:
Investments, at value*............................... $32,048,828 $30,619,732 $3,115,172
Interest receivable.................................. 317,859 399,601 45,182
Open forward currency contracts......................
Closed forward currency contracts....................
Receivable for investments sold......................
Receivable for fund shares sold......................
Unamortized organization costs (Note 4).............. 36,234
Deferred expense subsidy (Note 5).................... 164,004 160,975 41,000
Other assets......................................... 6,698 6,640 19,446
--------------- --------------- ---------------
TOTAL ASSETS.................................... 32,537,389 31,186,948 3,257,034
--------------- --------------- ---------------
LIABILITIES:
Open forward currency contracts......................
Closed forward currency contracts....................
Payable for investments purchased.................... 39,230
Payable for open futures contracts................... 1,400
Payable for funds shares redeemed....................
Payable to Payden & Rygel (Note 5)................... 17,333 78,019 75,838
Accrued expenses:
Investment advisory fees......................... 132,281 68,284 1,869
Administration fees.............................. 6,825 5,868 400
Other expenses................................... 27,709 27,587 18,926
Other liabilities....................................
--------------- --------------- ---------------
Total liabilities.............................. 184,148 179,758 137,663
--------------- --------------- ---------------
NET ASSETS..................................... 32,353,241 31,007,190 3,119,371
--------------- --------------- ---------------
--------------- --------------- ---------------
NET ASSETS:
Paid in capital...................................... 32,293,541 31,599,989 3,165,265
Undistributed net investment income.................. 9,466 17,113 1,882
Accumulated net realized gains (losses) from:
Investments...................................... 617,362 375,464 (33,411)
Foreign currency transactions....................
Futures contracts................................ 32,149
Net unrealized appreciation (depreciation) from:
Investments...................................... (567,128) (985,376) (63,039)
Translation of assets and liabilities in foreign
currencies.....................................
Open futures contracts........................... 16,525
--------------- --------------- ---------------
NET ASSETS.................................. $32,353,241 $ 31,007,190 $ 3,119,371
--------------- --------------- ---------------
--------------- --------------- ---------------
Outstanding shares of beneficial interest............ 3,390,044 3,237,728 307,117
--------------- --------------- ---------------
--------------- --------------- ---------------
NET ASSET VALUE - offering and redemption price per
share............................................. $ 9.54 $ 9.58 $ 10.16
--------------- --------------- ---------------
--------------- --------------- ---------------
- ----------
*Investments at cost............................... $32,615,956 $ 31,605,108 $ 3,178,211
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 17
<PAGE>
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHORT
GLOBAL INTERNATIONAL DURATION
FIXED INCOME BOND TAX EXEMPT
FUND FUND FUND
------------ ------------- -------------
------------ ------------- -------------
<S> <C> <C> <C>
INVESTMENT INCOME - INTEREST................ $19,159,903 $ 616,336 $ 513,839
------------ ------------- -------------
EXPENSES:
Investment advisory fees (Note 5)........... 975,161 36,319 37,076
Administration fees (Note 5)................ 198,700 6,350 7,426
Custodian and accounting fees (Note 5)...... 143,678 23,150 13,903
Legal and audit fees........................ 51,629 11,446 11,466
Organization expenses (Note 4).............. 9,070 496 546
Trustees' fees and expenses................. 47,781 1,586 1,712
Transfer agent fees (Note 5)................ 34,348 6,353 6,512
Registration and filing fees................ 70,463 14,264 8,402
Printing costs.............................. 10,926 231 882
Other expenses.............................. 35,473 649 2,187
Expense subsidy (Note 5).................... (32,125) (37,898)
------------ ------------- -------------
Total Expenses............................ 1,577,229 68,719 52,214
------------ ------------- -------------
Net Investment Income................... 17,582,674 547,617 461,625
------------ ------------- -------------
REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gains (losses) from:
Investments............................... 10,598,339 (249,056)* 83,652
Foreign currency transactions............. 8,068,851 (90,313)
Futures contracts......................... (84,068)
Change in net unrealized appreciation
(depreciation) from:
Investments............................... (47,935,684) (961,565) (199,866)
Translation of assets and liabilities in
foreign currencies....................... 18,777,427 538,654
Futures contracts......................... (13,438)
------------ ------------- -------------
Net realized and unrealized gains
(losses)............................... (10,491,067) (762,280) (213,720)
------------ ------------- -------------
CHANGE IN NET ASSETS RESULTING FROM
OPERATIONS................................. $7,091,607 $(214,663) $ 247,905
------------ ------------- -------------
------------ ------------- -------------
</TABLE>
- ---------
* Includes net realized loss of $79,924 on option contracts written.
SEE NOTES TO FINANCIAL STATEMENTS.
18 Payden & Rygel Investment Group
<PAGE>
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
TAX EXEMPT U.S. LIMITED SHORT
BOND TREASURY MATURITY BOND
FUND FUND FUND FUND
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME - INTEREST................ $ 1,239,832 $ 500,655 $ 620,749 $ 715,022
------------- ------------- ------------- -------------
EXPENSES:
Investment advisory fees (Note 5).......... 76,850 23,272 29,870 33,485
Administration fees (Note 5)............... 15,412 5,302 6,810 7,637
Custodian and accounting fees (Note 5)..... 16,442 11,503 10,915 10,969
Legal and audit fees....................... 12,597 11,286 11,409 11,458
Organization expenses (Note 4)............. 1,355 382 163
Trustees' fees and expenses................ 3,503 2,242 1,299 1,571
Transfer agend fees (Note 5)............... 7,698 6,217 6,248 6,451
Registration and filing fees............... 8,479 13,897 9,386 9,450
Printing costs............................. 2,310 (733) 81 807
Other expenses............................. 3,674 947 1,564 1,268
Expense subsidy (Note 5)................... (40,152) (36,850) (45,762) (35,256)
------------- ------------- ------------- -------------
Total expenses.......................... 108,168 37,465 31,983 47,840
------------- ------------- ------------- -------------
Net Investment Income................ 1,131,664 463,190 588,766 667,182
------------- ------------- ------------- -------------
REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gains (losses) from:
Investments............................. 54,941 76,720 (29,334) 49,941
Foreign currency transactions...........
Futures contracts....................... 83,540
Change in net unrealized appreciation
(depreciation) from:
Investments............................. (1,183,120) (642,595) (87,735) (560,097)
Translation of assets and liabilities in
foreign currencies....................
Futures contracts....................... (66,250)
------------- ------------- ------------- -------------
Net realized and unrealized gains (losses) (1,110,889) (565,875) (117,069) (510,156)
------------- ------------- ------------- -------------
$ 20,775 $(102,685) $ 471,697 $ 157,026
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
</TABLE>
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
INTERMEDIATE MARKET
BOND OPPORTUNITY RETURN
FUND FUND FUND (A)
------------- ------------- -------------
------------- ------------- -------------
<S> <C> <C> <C>
INVESTMENT INCOME - INTEREST................ $ 1,079,316 $ 901,124 $ 37,794
------------- ------------- -------------
EXPENSES:
Investment advisory fees (Note 5).......... 47,728 39,927 1,869
Administration fees (Note 5)............... 11,034 9,191 400
Custodian and accounting fees (Note 5)..... 12,278 12,008 4,377
Legal and audit fees....................... 11,990 12,052 9,709
Organization expenses (Note 4)............. 3,167
Trustees' fees and expenses................ 2,575 2,301 70
Transfer agend fees (Note 5)............... 7,126 6,940 4,610
Registration and filing fees............... 9,399 10,170 13,572
Printing costs............................. 1,426 1,707 3,048
Other expenses............................. 1,961 1,958 530
Expense subsidy (Note 5)................... (28,817) (32,027) (41,000)
-------------- ------------- -------------
Total expenses.......................... 76,700 64,227 352
-------------- ------------- -------------
Net Investment Income................ 1,002,616 836,897 37,442
-------------- ------------- -------------
REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gains (losses) from:
Investments............................. 615,849 375,453 (33,411)
Foreign currency transactions...........
Futures contracts....................... 32,149
Change in net unrealized appreciation
(depreciation) from:
Investments............................. (1,496,920) (1,585,148) (63,039)
Translation of assets and liabilities in
foreign currencies....................
Futures contracts....................... 16,525
------------- ------------- -------------
Net realized and unrealized gains (losses) (881,071) (1,209,695) (47,776)
------------- ------------- -------------
$ 121,545 $ (372,798) $ (10,334)
------------- ------------- -------------
------------- ------------- -------------
- ----------
(A) The Fund commenced operations on December 1, 1995.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 19
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
GLOBAL FIXED
INCOME FUND INTERNATIONAL BOND FUND
------------------------------- -------------------------------
------------------------------- -------------------------------
SIX MONTHS YEAR SIX MONTHS PERIOD
ENDED ENDED ENDED ENDED
APRIL 30, 1996 OCTOBER 31, APRIL 30, 1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995(A)
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income....................................... $ 17,582,674 $ 28,703,456 $ 547,617 $ 370,386
Net realized gains (losses)................................. 18,667,190 27,506,560 (339,369) (98,063)
Change in net unrealized appreciation (depreciation)........ (29,158,257) 9,681,400 (422,911) (166,848)
-------------- -------------- -------------- --------------
Change in net assets resulting from operations............ 7,091,607 65,891,416 (214,663) 105,475
-------------- -------------- -------------- --------------
FROM DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income....................................... (25,830,812) (41,196,930) (109,856) (219,289)
Net realized gains from investments......................... (75,914) (53,034)
In excess of net realized gains from investments............ (16,571)
-------------- -------------- -------------- --------------
Change in net assets from distributions to shareholders... (25,830,812) (41,196,930) (185,770) (288,894)
-------------- -------------- -------------- --------------
FROM CAPITAL TRANSACTIONS:
Proceeds from fund shares sold.............................. 181,178,397 111,729,616 2,800,000 19,111,194
Reinvestment of distributions............................... 23,875,327 38,712,586 180,026 268,449
Cost of fund shares redeemed................................ (61,160,001) (65,305,726) (2,189,134) (1,937)
-------------- -------------- -------------- --------------
Change in net assets from capital transactions............ 143,893,723 85,136,476 790,892 19,377,706
-------------- -------------- -------------- --------------
Total Change in Net Assets.............................. 125,154,518 109,830,962 390,459 19,194,287
NET ASSETS:
Beginning of period......................................... 540,040,901 430,209,939 19,194,287 0
-------------- -------------- -------------- --------------
End of period............................................... $ 665,195,419 $ 540,040,901 $ 19,584,746 $ 19,194,287
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
FUND SHARES OF BENEFICIAL INTEREST:
Outstanding shares at beginning of period................... 52,327,237 44,045,982 1,912,673 0
-------------- -------------- -------------- --------------
Shares sold................................................. 17,384,066 10,968,947 280,561 1,886,243
Shares issued in reinvestment of distributions.............. 2,330,469 3,831,846 17,707 26,628
Shares redeemed............................................. (5,876,261) (6,519,538) (221,952) (198)
-------------- -------------- -------------- --------------
Change in shares outstanding................................ 13,838,274 8,281,255 76,316 1,912,673
-------------- -------------- -------------- --------------
Outstanding shares at end of period......................... 66,165,511 52,327,237 1,988,989 1,912,673
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
</TABLE>
- ------------
(a) The Fund commenced operations on April 1, 1995.
SEE NOTES TO FINANCIAL STATEMENTS.
20 Payden & Rygel Investment Group
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SHORT DURATION
TAX EXEMPT FUND TAX EXEMPT BOND FUND
------------------------------- -------------------------------
------------------------------- -------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, 1996 OCTOBER 31, APRIL 30, 1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income...................................... $ 461,625 $ 738,428 $ 1,131,664 $ 1,545,633
Net realized gains (losses)................................ (416) 33,670 138,481 (216,473)
Change in net unrealized appreciation (depreciation)....... (213,304) 227,515 (1,249,370) 2,443,288
-------------- -------------- -------------- --------------
Change in net assets resulting from operations.......... 247,905 999,613 20,775 3,772,448
-------------- -------------- -------------- --------------
FROM DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income...................................... (452,846) (743,140) (1,108,726) (1,550,994)
Net realized gains from investments........................ (32,674)
In excess of net realized gains from investments...........
-------------- -------------- -------------- --------------
Change in net assets from distributions to shareholders. (485,520) (743,140) (1,108,726) (1,550,994)
-------------- -------------- -------------- --------------
FROM CAPITAL TRANSACTIONS:
Proceeds from fund shares sold............................. 15,040,633 17,480,222 15,305,103 14,684,139
Reinvestment of distributions.............................. 378,669 678,179 959,166 1,467,907
Cost of fund shares redeemed............................... (6,157,544) (22,546,345) (1,219,749) (3,795,557)
-------------- -------------- -------------- --------------
Change in net assets from capital transactions.......... 9,261,758 (4,387,944) 15,044,520 12,356,489
-------------- -------------- -------------- --------------
Total Change in Net Assets.......................... 9,024,143 (4,131,471) 13,956,569 14,577,943
NET ASSETS:
Beginning of period........................................ 16,018,618 20,150,089 40,051,668 25,473,725
-------------- -------------- -------------- --------------
End of period.............................................. $ 25,042,761 $ 16,018,618 $ 54,008,237 $ 40,051,668
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
FUND SHARES OF BENEFICIAL INTEREST:
Outstanding shares at beginning of period.................. 1,589,820 2,029,728 4,177,567 2,861,275
-------------- -------------- -------------- --------------
Shares sold................................................ 1,489,849 1,745,760 1,585,794 1,570,000
Shares issued in reinvestment of distributions............. 37,529 67,925 99,535 158,441
Shares redeemed............................................ (610,598) (2,253,593) (128,219) (412,149)
-------------- -------------- -------------- --------------
Change in shares outstanding............................... 916,780 (439,908) 1,557,110 1,316,292
-------------- -------------- -------------- --------------
Outstanding shares at end of period........................ 2,506,600 1,589,820 5,734,677 4,177,567
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
U.S. TREASURY FUND
-------------------------------
-------------------------------
SIX MONTHS PERIOD
ENDED ENDED
APRIL 30, 1996 OCTOBER 31,
(UNAUDITED) 1995(B)
-------------- --------------
-------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income...................................... $ 463,190 $ 355,690
Net realized gains (losses)................................ 76,720 34,473
Change in net unrealized appreciation (depreciation)....... (642,595) 330,374
-------------- --------------
Change in net assets resulting from operations.......... (102,685) 720,537
-------------- --------------
FROM DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income...................................... (456,158) (352,240)
Net realized gains from investments........................ (37,939)
In excess of net realized gains from investments...........
-------------- --------------
Change in net assets from distributions to shareholders. (494,097) (352,240)
-------------- --------------
FROM CAPITAL TRANSACTIONS:
Proceeds from fund shares sold............................. 8,514,886 11,528,561
Reinvestment of distributions.............................. 413,462 351,159
Cost of fund shares redeemed............................... (2,130,219) (1,353,749)
-------------- --------------
Change in net assets from capital transactions.......... 6,798,129 10,525,971
-------------- --------------
Total Change in Net Assets.......................... 6,201,347 10,894,268
NET ASSETS:
Beginning of period........................................ 10,894,268 0
-------------- --------------
End of period.............................................. $ 17,095,615 $ 10,894,268
-------------- --------------
-------------- --------------
FUND SHARES OF BENEFICIAL INTEREST:
Outstanding shares at beginning of period.................. 1,026,380 0
-------------- --------------
Shares sold................................................ 795,454 1,121,118
Shares issued in reinvestment of distributions............. 39,001 33,655
Shares redeemed............................................ (204,735) (128,393)
-------------- --------------
Change in shares outstanding............................... 629,720 1,026,380
-------------- --------------
Outstanding shares at end of period........................ 1,656,100 1,026,380
-------------- --------------
-------------- --------------
</TABLE>
- ----------
(B) The Fund commenced operations on January 1, 1995.
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 21
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
<TABLE>
<CAPTION>
LIMITED MATURITY FUND SHORT BOND FUND
------------------------ ------------------------
------------------------ ------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
APRIL 30, ENDED APRIL 30, ENDED
1996 OCTOBER 31, 1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income...................................... $ 588,766 $ 879,148 $ 667,182 $ 573,521
Net realized gains (losses)................................ (29,334) 999 49,941 59,994
Change in net unrealized appreciation (depreciation)....... (87,735) 91,216 (560,097) 201,029
----------- ----------- ----------- -----------
Change in net assets resulting from operations........... 471,697 971,363 157,026 834,544
----------- ----------- ----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income...................................... (571,903) (881,648) (648,638) (570,116)
Net realized gains from investments........................ (16,883)
In excess of net realized gains from investments...........
----------- ----------- ----------- -----------
Change in net assets from distributions to shareholders.. (571,903) (881,648) (665,521) (570,116)
----------- ----------- ----------- -----------
FROM CAPITAL TRANSACTIONS:
Proceeds from fund shares sold............................. 38,592,473 30,816,505 24,783,791 22,625,118
Reinvestment of distributions.............................. 567,364 866,908 650,874 570,116
Cost of fund shares redeemed............................... (18,682,417) (27,606,714) (7,460,769) (6,894,440)
----------- ----------- ----------- -----------
Change in net assets from capital transactions........... 20,477,420 4,076,699 17,973,896 16,300,794
----------- ----------- ----------- -----------
Total Change in Net Assets........................... 20,377,214 4,166,414 17,465,401 16,565,222
NET ASSETS:
Beginning of period........................................ 18,414,303 14,247,889 19,156,786 2,591,564
----------- ----------- ----------- -----------
End of period.............................................. $38,791,517 1$8,414,303 3$6,622,187 1$9,156,786
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
FUND SHARES OF BENEFICIAL INTEREST:
Outstanding shares at beginning of period.................. 1,830,050 1,424,310 1,907,327 267,604
----------- ----------- ----------- -----------
Shares sold................................................ 3,838,434 3,067,449 2,469,012 2,270,630
Shares issued in reinvestment of distributions............. 56,447 86,480 64,867 57,274
Shares redeemed............................................ (1,857,081) (2,748,189) (747,163) (688,181)
----------- ----------- ----------- -----------
Change in shares outstanding............................... 2,037,800 405,740 1,786,716 1,639,723
----------- ----------- ----------- -----------
Outstanding shares at end of period........................ 3,867,850 1,830,050 3,694,043 1,907,327
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
22 Payden & Rygel Investment Group
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
<TABLE>
<CAPTION>
MARKET
INTERMEDIATE BOND FUND OPPORTUNITY FUND RETURN FUND
------------------------ ------------------------ -----------
------------------------ ------------------------ -----------
SIX MONTHS SIX MONTHS PERIOD
ENDED YEAR ENDED YEAR ENDED
APRIL 30, ENDED APRIL 30, ENDED APRIL 30,
1996 OCTOBER 31, 1996 OCTOBER 31, 1996(C)
(UNAUDITED) 1995 (UNAUDITED) 1995 (UNAUDITED)
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income...................................... $1,002,616 $1,549,919 $ 836,897 $ 530,941 $ 37,442
Net realized gains (losses)................................ 615,849 471,047 375,453 202,864 (1,262)
Change in net unrealized appreciation (depreciation)....... (1,496,920) 1,010,731 (1,585,148) 600,568 (46,514)
----------- ----------- ----------- ----------- -----------
Change in net assets resulting from operations.......... 121,545 3,031,697 (372,798) 1,334,373 (10,334)
----------- ----------- ----------- ----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income...................................... (1,000,415) (1,549,848) (825,874) (526,378) (35,560)
Net realized gains from investments........................ (255,413) (13,423)
In excess of net realized gains from investments...........
----------- ----------- ----------- ----------- -----------
Change in net assets from distributions to shareholders. (1,255,828) (1,549,848) (839,297) (526,378) (35,560)
----------- ----------- ----------- ----------- -----------
FROM CAPITAL TRANSACTIONS:
Proceeds from fund shares sold............................. 6,562,651 19,805,492 13,075,555 25,177,485 3,202,184
Reinvestment of distributions.............................. 854,564 926,921 824,689 524,801 35,266
Cost of fund shares redeemed............................... (8,320,614) (2,135,210) (7,502,870) (3,718,336) (72,185)
----------- ----------- ----------- ----------- -----------
Change in net assets from capital transactions.......... (903,399) 18,597,203 6,397,374 21,983,950 3,165,265
----------- ----------- ----------- ----------- -----------
Total change in net assets........................... (2,037,682) 20,079,052 5,185,279 22,791,945 3,119,371
NET ASSETS:
Beginning of period........................................ 34,390,923 14,311,871 25,821,911 3,029,966 0
----------- ----------- ----------- ----------- -----------
End of period..............................................$32,353,241 3$4,390,923 3$1,007,190 2$5,821,911 $3,119,371
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
FUND SHARES OF BENEFICIAL INTEREST:
Outstanding shares at beginning of period................. 3,490,147 1,538,681 2,591,405 333,492 0
----------- ----------- ----------- ----------- -----------
Shares sold............................................... 659,266 2,074,179 1,309,199 2,588,864 310,376
Shares issued in reinvestment of distributions............ 86,944 96,175 82,993 54,154 3,446
Shares redeemed........................................... (846,313) (218,888) (745,869) (385,105) (6,705)
----------- ----------- ----------- ----------- -----------
Change in shares outstanding.............................. (100,103) 1,951,466 646,323 2,257,913 307,117
----------- ----------- ----------- ----------- -----------
Outstanding shares at end of period....................... 3,390,044 3,490,147 3,237,728 2,591,405 307,117
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
</TABLE>
- ----------
(c) The Fund commenced operations on December 1, 1995.
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 23
<PAGE>
GLOBAL FIXED INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
IN LOCAL MARKET VALUE IN
CURRENCY SECURITY DESCRIPTION U.S. DOLLARS
------------ ------------------------------------------------ -----------------
CANADA (CANADIAN DOLLAR) (9.9%):
<C> <S> <C>
Government Bonds (9.9%):
17,400,000 8.50%, 4/1/02................................... $ 13,517,852
66,900,000 8.75%, 12/1/05.................................. 52,317,844
-----------------
Total Canada (Cost -- $67,795,169)............................ 65,835,696
-----------------
DENMARK (DANISH KRONE) (9.5%):
Government Bonds (9.5%):
347,600,000 8.00%, 11/15/01................................. 63,310,127
-----------------
Total Denmark (Cost -- $64,753,802)........................... 63,310,127
-----------------
GERMANY (GERMAN MARK) (28.1%):
Corporate Bonds (3.8%):
Finance (3.8%):
18,800,000 KFW International Finance, 6.75%, 6/20/05....... 12,471,202
20,300,000 LKB Bade-Wurttemburg Finance, 6.50%, 9/15/08.... 12,926,006
-----------------
Total Corporate Bonds......................................... 25,397,208
-----------------
Government Bonds (21.6%):
67,500,000 Deutschland Republic, 6.25%, 1/4/24............. 39,431,870
30,500,000 Deutschland Republic, 6.50%, 10/14/05........... 20,091,286
43,500,000 German Unity Fund, 8.00%, 1/21/02............... 31,636,880
79,600,000 Treuhandanstalt, 6.25%, 3/4/04.................. 52,284,391
-----------------
Total Government Bonds........................................ 143,444,427
-----------------
U.S. Government Agencies (2.7%):
Federal Home Loan Bank (2.7%):
27,000,000 Federal Home Loan Bank Global Bond, 6.00%,
8/23/00........................................ 18,143,239
-----------------
Total U.S. Government Agencies................................ 18,143,239
-----------------
Total Germany (Cost -- $199,980,223).......................... 186,984,874
-----------------
GREAT BRITAIN (BRITISH POUND) (4.6%):
Government Bonds (4.6%):
20,100,000 UK Gilt, 8.00%, 12/7/00......................... 30,860,755
-----------------
Total Great Britain (Cost -- $32,151,123)..................... 30,860,755
-----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
24 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
IN LOCAL MARKET VALUE IN
CURRENCY SECURITY DESCRIPTION U.S. DOLLARS
------------ ------------------------------------------------ -----------------
JAPAN (JAPANESE YEN) (5.0%):
<C> <S> <C>
Supranational Bonds (5.0%):
2,085,000,000 European Investment Bank, 4.63%, 2/26/03........ $ 21,662,338
1,100,000,000 IBRD Global Bond, 4.50%, 3/20/03................ 11,410,714
-----------------
Total Japan (Cost -- $39,740,915)............................. 33,073,052
-----------------
NETHERLANDS (DUTCH GUILDER) (4.6%):
Government Bonds (4.6%):
53,500,000 6.00%, 1/15/06.................................. 30,512,620
-----------------
Total Netherlands (Cost -- $32,908,075)....................... 30,512,620
-----------------
SWEDEN (SWEDISH KRONA) (5.1%):
Government Bonds (5.1%):
208,900,000 11.00%, 1/21/99................................. 33,743,847
-----------------
Total Sweden (Cost -- $31,734,585)............................ 33,743,847
-----------------
UNITED STATES (UNITED STATES DOLLARS) (29.5%):
U.S. Treasury Notes (28.8%):
60,000,000 5.75%, 8/15/03 (a).............................. 56,990,625
41,000,000 5.88%, 2/15/04.................................. 39,033,281
45,500,000 7.25%, 8/15/04.................................. 47,078,282
35,000,000 5.88%, 11/15/05................................. 32,960,156
15,800,000 5.00%, 2/15/99.................................. 15,326,000
-----------------
Total U.S. Treasury Notes..................................... 191,388,344
-----------------
Cash Equivalents (0.8%):
5,061,155 First Chicago Credit Interest................... 5,061,155
-----------------
Total United States (Cost -- $201,860,046).................... 196,449,499
-----------------
TOTAL (COST -- $670,923,938)(B) (96.3%)....................... $ 640,770,470
-----------------
-----------------
</TABLE>
- ---------
Percentages indicated are based on net assets of $665,195,419.
(a) A portion of the security is held by the custodian in a segregated account
as collateral for open short positions.
(b) For federal income tax purposes, cost is $667,382,865, and net unrealized
appreciation (depreciation) of securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation........................................................ $ 3,149,808
Unrealized depreciation........................................................ (29,762,203)
------------
Net unrealized depreciation.................................................... $(26,612,395)
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 25
<PAGE>
GLOBAL FIXED INCOME FUND
FORWARD CURRENCY CONTRACTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
CONTRACT UNREALIZED
CONTRACT VALUE (U.S. APPRECIATION DELIVERY
CURRENCY PRICE DOLLARS) (DEPRECIATION) DATE
- ---------------------------------------------- ---------- ------------- ------------- -----------
<S> <C> <C> <C> <C>
ASSETS:
British Pound (sold).......................... 1.532900 $29,696,495 $ 654,925 05/13/96
British Pound (sold).......................... 1.538000 2,249,735 57,265 05/13/96
Danish Krone (sold)........................... 5.766300 64,422,030 1,478,114 06/12/96
Dutch Guilder (sold).......................... 1.646000 31,896,001 1,275,323 05/28/96
German Mark (sold)............................ 1.471880 45,696,679 1,861,546 05/14/96
German Mark (sold)............................ 1.470530 78,341,766 3,261,466 05/15/96
German Mark (sold)............................ 1.509075 65,303,990 961,769 05/20/96
Japanese Yen (sold)........................... 104.000000 3,251,037 18,193 05/09/96
------------- -------------
$320,857,733 $ 9,568,601
------------- -------------
------------- -------------
LIABILITIES:
Canadian Dollar (sold)........................ 1.361975 $33,094,367 $ (54,114) 06/27/96
Japanese Yen (sold)........................... 104.849000 30,980,475 (78,892) 05/09/96
Swedish Krona (sold).......................... 6.815500 33,111,674 (69,344) 06/07/96
------------- -------------
$97,186,516 $ (202,350)
------------- -------------
------------- -------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
26 Payden & Rygel Investment Group
<PAGE>
INTERNATIONAL BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
IN LOCAL MARKET VALUE IN
CURRENCY SECURITY DESCRIPTION U.S. DOLLARS
------------ ------------------------------------------------ -----------------
<C> <S> <C>
AUSTRIA (AUSTRIAN SCHILLING) (4.4%):
Government Bonds (4.4%):
9,200,000 Republic of Austria, 6.88%, 6/20/05............. $ 869,542
-----------------
Total Austria (Cost -- $909,468).............................. 869,542
-----------------
CANADA (CANADIAN DOLLAR) (8.8%):
Government Bonds (4.3%):
1,075,000 8.75%, 12/1/05.................................. 840,683
-----------------
Provincial Bonds (4.5%):
1,200,000 British Columbia, 8.00%, 8/23/05................ 883,338
-----------------
Total Canada (Cost -- $1,729,120)............................. 1,724,021
-----------------
DENMARK (DANISH KRONE) (9.7%):
Government Bonds (9.7%):
9,700,000 7.00%, 12/15/04................................. 1,639,039
1,400,000 8.00%, 11/15/01................................. 254,989
-----------------
Total Denmark (Cost -- $1,957,532)............................ 1,894,028
-----------------
GERMANY (GERMAN MARK) (31.3%):
Corporate Bonds (6.3%):
Finance (6.3%):
600,000 KFW International Finance, 6.75%, 6/20/05....... 398,017
1,315,000 LKB Bade-Wurttemburg Finance, 6.50%, 9/15/08.... 837,325
-----------------
Total Corporate Bonds......................................... 1,235,342
-----------------
Government Bonds (20.6%):
2,300,000 Deutschland Republic, 6.25%, 1/4/24............. 1,343,604
3,050,000 Deutschland Republic, 6.50%, 10/14/05........... 2,009,129
1,000,000 Treuhandanstalt, 6.75%, 5/13/04................. 674,907
-----------------
Total Government Bonds........................................ 4,027,640
-----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 27
<PAGE>
INTERNATIONAL BOND FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
IN LOCAL MARKET VALUE IN
CURRENCY SECURITY DESCRIPTION U.S. DOLLARS
------------ ------------------------------------------------ -----------------
<C> <S> <C>
GERMANY (CONTINUED):
U.S. Government Agencies (4.5%):
Federal National Mortgage Association (4.5%):
1,300,000 Federal National Mortgage Association Global
Bond, 6.00%, 8/23/00........................... $ 873,648
-----------------
Total U.S. Government Agencies................................ 873,648
-----------------
Total Germany (Cost -- $6,516,907)............................ 6,136,630
-----------------
GREAT BRITAIN (BRITISH POUND) (6.7%):
Government Bonds (4.5%):
575,000 U.K. Gilt, 8.00%, 6/10/03....................... 872,319
Supranational Bonds (2.2%):
300,000 European Investment Bank, 6.00%, 8/10/99........ 434,083
-----------------
Total Great Britain (Cost -- $1,355,024)...................... 1,306,402
-----------------
IRELAND (IRISH PUNT) (4.5%):
Government Bonds (4.5%):
610,000 6.25%, 10/18/04................................. 883,024
-----------------
Total Ireland (Cost -- $900,945).............................. 883,024
-----------------
JAPAN (JAPANESE YEN) (12.1%):
Government Bonds (4.4%):
85,000,000 Japan 170, 4.10%, 6/21/04....................... 858,847
-----------------
Supranational Bonds (7.7%):
80,000,000 Asian Development Bank, 5.00%, 2/5/03........... 848,740
63,000,000 IBRD Global Bond, 4.50%, 3/20/03................ 653,523
-----------------
1,502,263
-----------------
Total Japan (Cost -- $2,425,909).............................. 2,361,110
-----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
28 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
IN LOCAL MARKET VALUE IN
CURRENCY SECURITY DESCRIPTION U.S. DOLLARS
------------ ------------------------------------------------ -----------------
NETHERLANDS (DUTCH GUILDER) (4.2%):
<C> <S> <C>
Government Bonds (4.2%):
1,275,000 7.75%, 3/1/05................................... $ 819,627
-----------------
Total Netherlands (Cost -- $882,170).......................... 819,627
-----------------
SPAIN (SPANISH PESETA) (6.6%):
Government Bonds (6.6%):
50,000,000 10.00%, 2/28/05................................. 412,583
100,000,000 12.25%, 3/25/00................................. 884,150
-----------------
Total Spain (Cost -- $1,291,430).............................. 1,296,733
-----------------
SWEDEN (SWEDISH KRONA) (7.2%):
Government Bonds (7.2%):
3,700,000 11.00%, 1/21/99................................. 597,665
6,400,000 6.00%, 2/9/05................................... 812,661
-----------------
Total Sweden (Cost -- $1,382,555)............................. 1,410,326
-----------------
UNITED STATES (UNITED STATES DOLLARS) (1.1%):
U.S. Treasury Notes (0.8%):
150,000 6.13%, 5/15/98 (a).............................. 150,141
-----------------
Cash Equivalents (0.4%):
69,999 First Chicago Credit Interest................... 69,999
-----------------
Total United States (Cost -- $220,140)........................ 220,140
-----------------
TOTAL (COST -- $19,571,200)(B) (96.6%)........................ $ 18,921,583
-----------------
-----------------
</TABLE>
- ---------
Percentages indicated are based on net assets of $19,584,746.
(a) A portion of the security is held by the custodian in a segregated account
as collateral for open short positions.
(b) For federal income tax purposes, cost is $19,723,699, and net unrealized
appreciation (depreciation) of securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation.......................................................... $ 51,938
Unrealized depreciation.......................................................... (854,054)
------------
Net unrealized depreciation...................................................... $ (802,116)
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 29
<PAGE>
INTERNATIONAL BOND FUND
FORWARD CURRENCY CONTRACTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
CONTRACT
VALUE UNREALIZED
CONTRACT (U.S. APPRECIATION DELIVERY
CURRENCY PRICE DOLLARS) (DEPRECIATION) DATE
- --------------------------------- ----------- ------------- ------------- ---------
<S> <C> <C> <C> <C>
ASSETS:
British Pound (sold)............. 1.532900 $1,379,837 $ 30,431 05/13/96
Danish Krone (sold).............. 5.892100 880,984 1,554 05/29/96
German Mark (sold)............... 1.494600 1,958,429 48,797 05/14/96
German Mark (sold)............... 1.509075 2,873,375 42,318 05/20/96
Irish Punt (sold)................ 1.557940 931,368 3,396 06/28/96
------------- -------------
$8,023,993 $ 126,496
------------- -------------
------------- -------------
LIABILITIES:
Canadian Dollar (sold)........... 1.361975 $ 294,172 $ (481) 06/27/96
Canadian Dollar (sold)........... 1.363240 91,929 (236) 06/27/96
German Mark (bought)............. 1.471880 1,175,057 (47,868) 05/14/96
Swedish Krona (sold)............. 6.815500 514,613 (1,078) 06/07/96
------------- -------------
$ 2,075,771 $ (49,663)
------------- -------------
------------- -------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
30 Payden & Rygel Investment Group
<PAGE>
SHORT DURATION TAX EXEMPT FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
------------ -------------------------------------------------- -----------
<C> <S> <C>
GENERAL OBLIGATIONS (29.2%):
Unlimited (29.2%)
700,000 Florida State Board Education Capital Outlay,
6.50%, 6/1/97.................................... $718,550
1,000,000 Illinois State, 6.375%, 8/1/00.................... 1,066,250
700,000 Illinois State, 5.50%, 2/1/99..................... 715,750
700,000 Minnesota State, 6.80%, 8/1/00, Pre-Refunded,
8/1/98........................................... 739,375
1,000,000 New York City Series G, 5.60%, 2/1/02............. 998,750
500,000 Phoenix, Arizona, 5.30%, 7/1/06................... 508,125
1,500,000 Tennessee State, 5.90%, 6/1/98.................... 1,548,750
1,000,000 Washington Suburban Sanitation District, Maryland,
5.00%, 6/1/97.................................... 1,011,150
----------
Total General Obligations....................................... 7,306,700
----------
NOTES (0.4%):
100,000 Texas State Tax & Revenue Anticipation -- Series
A................................................ 100,352
----------
Total Notes..................................................... 100,352
----------
REVENUE (68.8%):
Airport (4.1%):
1,000,000 Washoe County, Nevada Airport Authority, 5.25%,
7/1/00, Insd: MBIA............................... 1,016,250
----------
Education (8.1%):
1,000,000 University of Texas, 5.00%, 8/15/97............... 1,012,500
1,000,000 Virginia State Public School Authority Series C,
5.00%, 8/1/98.................................... 1,016,250
---------
2,028,750
---------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 31
<PAGE>
SHORT DURATION TAX EXEMPT FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
------------ -------------------------------------------------- ---------
REVENUE (CONTINUED):
<C> <S> <C>
Electric (10.5%):
700,000 Georgia Municipal Electric Authority, 4.50%,
1/1/98........................................... $698,250
500,000 Sacramento, California Municipal Utility District,
5.25%, 11/15/04.................................. 498,750
500,000 San Antonio Electric & Gas, 6.00%, 2/1/98, Insd:
FGIC............................................. 513,125
900,000 Tacoma, Washington Electric System, 4.90%, 1/1/98,
Insd: AMBAC (a).................................. 907,875
---------
2,618,000
---------
Health (3.9%):
1,000,000 Missouri State Health & Ed, Sisters of Mercy,
4.25%, 12/1/99................................... 986,250
---------
Housing (1.8%):
450,000 Alaska State Housing Finance Corp, 4.35%, 12/1/98,
Insd: MBIA....................................... 448,875
---------
Jail (4.4%):
1,000,000 Ohio State Building Authority, 7.35%, 8/1/04, Pre-
Refunded, 8/1/99................................. 1,107,500
---------
Lease (1.8%):
450,000 Phoenix, Arizona Civic Plaza Building Corp Excise
Tax, 4.70%, 7/1/98............................... 454,500
---------
Sales Tax Revenue (12.0%):
1,000,000 Contra Costa, California Trans Auth, 5.00%,
3/1/98, Insd: FGIC............................... 1,012,500
2,000,000 Municipal Assist Corp for City of New York, New
York, 4.00%, 7/1/97.............................. 2,002,500
---------
3,015,000
---------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
32 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
------------ -------------------------------------------------- ----------
REVENUE (CONTINUED):
<C> <S> <C>
Sewer (4.1%):
1,000,000 Portland, Oregon Sewer System, 7.00%, 6/1/97...... $1,029,580
----------
Telecommunications (4.0%):
1,000,000 Puerto Rico Telecommunications Authority, 4.80%,
1/1/01........................................... 995,000
----------
Transportation (6.8%):
675,000 New Jersey State Turnpike Authority, 6.00%, 1/1/98
(a).............................................. 691,031
1,000,000 New York State Thruway Authority, 5.00%, 4/1/98,
Insd: AMBAC (a).................................. 1,013,750
----------
1,704,781
----------
Water
(7.2%):
755,000 Ohio State Water Development Authority, 4.95%,
12/1/98, Insd: MBIA.............................. 766,325
1,000,000 Orlando, Florida Utilities Commission, 5.70%,
10/1/04.......................................... 1,048,750
----------
1,815,075
----------
Total Revenue................................................... 17,219,561
----------
VARIABLE RATE DEMAND NOTES (5.6%):
Airport (2.4%):
600,000 Metro Nashville Airport Authority - American
Airlines, 4.05% (b), 10/1/12..................... 600,000
----------
Industrial Development Revenue (0.8%):
200,000 Babylon, NY Industrial Development Agency, 4.10%
(b), 12/1/24..................................... 200,000
----------
Pollution Control Revenue (2.4%):
600,000 Port of Portland, Oregon Pollution Control, 4.05%
(b), 12/1/09..................................... 600,000
----------
Total Variable Rate Demand Notes................................ 1,400,000
----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 33
<PAGE>
SHORT DURATION TAX EXEMPT FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
------------ -------------------------------------------------- -----------
INVESTMENT COMPANIES (2.6%):
<C> <S> <C>
647,086 Prairie Municipal Money Market Fund............... $647,086
----------
Total Investment Companies...................................... 647,086
----------
TOTAL (COST -- $26,737,767)(C) (106.5%)......................... $26,673,699
----------
----------
</TABLE>
- ---------
AMBAC: AMBAC Indemnity Corporation
FGIC: Financial Guaranty Insurance Company
MBIA: MBIA Insurance Corp.
Percentages indicated are based on net assets of $25,042,761.
(a) A portion of the security is held by the custodian in a segregated account
as collateral for open futures contracts.
At April 30, 1996, the Fund's open futures contracts were as follows:
<TABLE>
<CAPTION>
NUMBER OF EXPIRATION NOTIONAL CURRENT
CONTRACTS CONTRACT TYPE DATE AMOUNT MARKET VALUE
- --------------- -------------------------------------------------------------- --------- ------------ ------------
<S> <C> <C> <C> <C>
12 Treasury Future June 96 - 5 Year 6/19/96 $ 1,279,875 $1,271,062
4 Treasury Future June 96 - 10 Year 6/19/96 434,625 430,000
</TABLE>
(b) Variable rate investments. The rate reflected on the Schedule of Portfolio
Investments is the rate in effect at April 30, 1996.
(c) Represents cost for federal income tax purposes and differs from value by
unrealized appreciation (depreciation) of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation.......................................................... $ 50,594
Unrealized depreciation.......................................................... (114,662)
------------
Net unrealized depreciation...................................................... $ (64,068)
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
34 Payden & Rygel Investment Group
<PAGE>
TAX EXEMPT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
<C> <S> <C>
GENERAL OBLIGATIONS (43.6%):
Limited (1.3%):
700,000 Clark County, Nevada School District, 5.88%,
6/15/13, Insd: MBIA............................ $ 702,625
-----------------
Unlimited (42.3%):
1,325,000 California State, 7.00%, 8/1/05, Insd: FGIC..... 1,508,844
250,000 California State, 4.75%, 9/1/09................. 230,312
1,500,000 Charleston County, South Carolina, 5.75%,
6/1/08......................................... 1,554,375
1,200,000 Chicago, Illinois Metro Water Reclamation
District, 6.30%, 12/1/09....................... 1,264,500
1,000,000 City of Los Angeles, California, 5.25%,
9/1/06......................................... 998,750
765,000 Du Page County, Illinois Stormwater, 5.60%,
1/1/21......................................... 735,356
1,500,000 Florida State Board of Education, 5.00%,
6/1/08......................................... 1,447,500
1,000,000 Fort Worth, Texas Independent School District,
0.00%, 2/15/06, Insd: PSF...................... 600,000
1,000,000 Georgia State, 5.50%, 7/1/07.................... 1,028,750
1,000,000 Honolulu, Hawaii City & County, 5.00%,
10/1/02........................................ 1,003,750
1,000,000 Massachusetts State, 5.75%, 2/1/15, Insd:
MBIA........................................... 983,750
1,235,000 Massachusetts State Turnpike Authority, 5.00%,
6/1/99......................................... 1,255,044
750,000 Mecklenburg County, North Carolina, 6.20%,
1/1/01......................................... 802,500
1,000,000 Mississippi State, 5.80%, 6/1/09................ 1,020,000
1,250,000 Montgomery County, Maryland, 6.88%, 10/1/99..... 1,348,438
1,000,000 New York, New York, 6.20%, 8/1/07............... 1,002,500
1,000,000 Pennsylvania State, 5.20%, 6/15/04, Insd:
MBIA........................................... 1,012,500
1,000,000 Texas Public Finance Authority, 5.38%,
10/1/03........................................ 1,028,750
1,000,000 Texas State College Student Loan, 5.00%,
8/1/21......................................... 870,000
1,000,000 Virginia State, 6.10%, 6/1/06................... 1,076,250
1,000,000 Washington State, 5.25%, 9/1/05................. 1,008,750
1,000,000 Wisconsin State, 6.30%, 5/1/10, Pre-Refunded,
5/1/02......................................... 1,077,500
-----------------
22,858,119
-----------------
Total General Obligations..................................... 23,560,744
-----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 35
<PAGE>
TAX EXEMPT BOND FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
REVENUE (51.6%):
<C> <S> <C>
Airport (9.3%):
2,800,000 Los Angeles, California Harbor, 5.00%, 8/1/01... $ 2,817,500
1,200,000 Los Angeles, California City Dept of Airports,
5.50%, 5/15/07, Insd: FGIC..................... 1,200,000
1,010,000 San Francisco City & County Airports Comm Int'l
Airport, 5.00%, 5/01/06, Insd: FGIC............ 979,700
-----------------
4,997,200
-----------------
Education (8.6%):
1,250,000 New York State Dorm Authority, 6.13%, 7/1/07,
Insd: AMBAC.................................... 1,320,312
1,000,000 Ohio State Public Facilities Commission, 5.00%,
11/1/04, Insd: MBIA............................ 1,006,250
1,100,000 Pennsylvania State Higher Educational Facilities
Authority, 5.85%, 9/1/13....................... 1,090,375
1,160,000 University Texas Permanent Univ Fd, 5.90%,
7/1/02......................................... 1,229,600
-----------------
4,646,537
-----------------
Electric (7.2%):
300,000 City of Knoxville, Tennessee Gas System, 4.85%,
3/1/06......................................... 287,625
2,000,000 Georgia Municipal Electric Authority, 5.55%,
1/1/07, Insd: FGIC (a)......................... 2,035,000
575,000 Indiana Municipal Power Agency Power Supply,
5.13%, 1/1/01, Insd: MBIA...................... 582,906
1,000,000 Sacramento, California Municipal Utility
District, 5.25%, 11/15/04...................... 997,500
-----------------
3,903,031
-----------------
Health (1.0%):
500,000 Maryland Health & Higher Ed, 6.75%, 7/1/23, Pre-
refunded 7/1/00................................ 549,375
-----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
36 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
REVENUE (CONTINUED):
<C> <S> <C>
Housing (2.2%):
1,000,000 Virginia State Housing Development Authority,
6.30%, 7/1/11.................................. $ 1,020,000
170,000 Wisconsin Housing & Economic Development, 5.30%,
11/1/05 (a).................................... 166,813
-----------------
1,186,813
-----------------
Sales Tax Revenue (4.4%):
5,000,000 Metro Pier & Expo Auth Illinois State, 0.00%,
6/15/09, Insd: FGIC (a)........................ 2,362,500
-----------------
Sewer (2.0%):
2,500,000 City and County of San Francisco, California,
0.00%, 10/1/10, Insd: FGIC..................... 1,087,500
-----------------
Telecommunications (1.8%):
1,000,000 Puerto Rico Telecommunications Authority, 4.80%,
1/1/01......................................... 995,000
-----------------
Transportation (6.6%):
1,000,000 Massachusetts Bay Transportation Authority,
5.60%, 3/1/08.................................. 1,018,750
1,465,000 Port Authority New York & New Jersey, 5.80%,
12/1/12........................................ 1,461,338
1,000,000 Puerto Rico Commonwealth Hwy Auth, 6.75%,
7/1/05, Pre-Refunded, 7/1/00................... 1,098,750
-----------------
3,578,838
-----------------
Water (8.4%):
1,400,000 California State Department of Water Resources,
6.00%, 12/1/06 (a)............................. 1,496,250
2,000,000 Cleveland, Ohio Waterworks Revenue, 5.50%,
1/1/08, Insd: MBIA............................. 2,030,000
1,000,000 Ohio State Water Development Authority, 5.70%,
6/1/09, Insd: AMBAC............................ 1,012,500
-----------------
4,538,750
-----------------
Total Revenue................................................. 27,845,544
-----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 37
<PAGE>
TAX EXEMPT BOND FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
SPECIAL TAX (2.0%):
<C> <S> <C>
1,000,000 Connecticut State Special Tax Obligation, 6.25%,
10/1/09........................................ $ 1,055,000
-----------------
Total Special Tax............................................. 1,055,000
-----------------
VARIABLE RATE DEMAND NOTES (1.1%):
Pollution Control Revenue (1.1%):
600,000 Lincoln County, Wyoming Pollution Control
Revenue, 4.10% (b), 7/1/17..................... 600,000
-----------------
Total Variable Rate Demand Notes.............................. 600,000
-----------------
INVESTMENT COMPANIES (0.4%):
195,103 Prairie Municipal Money Market Fund............. 195,103
-----------------
Total Investment Companies.................................... 195,103
-----------------
TOTAL (COST -- $53,223,424)(C) (98.6%)........................ $ 53,256,391
-----------------
-----------------
</TABLE>
- ---------
AMBAC: AMBAC Indemnity Corporation
FGIC: Financial Guaranty Insurance Company
MBIA: MBIA Insurance Corp.
PSF: Permanent School Fund
Percentages indicated are based on net assets of $54,008,237.
(a) A portion of the security is held by the custodian in a segregated account
as collateral for open futures contracts.
At April 30, 1996, the Fund's open futures contracts were as follows:
<TABLE>
<CAPTION>
CURRENT
NUMBER OF EXPIRATION NOTIONAL MARKET
CONTRACTS CONTRACT TYPE DATE AMOUNT VALUE
- ---------- --------------------------- --------- --------- -----------
<S> <C> <C> <C> <C>
35 Municipal Bond Future 6/19/96 $3,960,000 $3,893,750
June 96
</TABLE>
(b) Variable rate investments. The rate reflected on the Schedule of Portfolio
Investments is the rate in effect at April 30, 1996.
(c) Represents cost for federal income tax purposes and differs from value by
unrealized appreciation (depreciation) of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation.......................................................... $ 652,627
Unrealized depreciation.......................................................... (619,660)
------------
Net unrealized appreciation...................................................... $ 32,967
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
38 Payden & Rygel Investment Group
<PAGE>
U.S. TREASURY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
<C> <S> <C>
U.S. TREASURY NOTES (72.5%):
750,000 8.63%, 8/15/97.................................. $ 775,268
1,500,000 5.88%, 8/15/98.................................. 1,491,765
1,000,000 7.50%, 10/31/99................................. 1,035,900
1,440,000 7.75%, 12/31/99................................. 1,504,814
765,000 7.75%, 1/31/00.................................. 799,869
1,200,000 7.75%, 2/15/01.................................. 1,264,464
4,000,000 8.00%, 5/15/01.................................. 4,263,920
780,000 7.88%, 11/15/04................................. 838,328
400,000 7.50%, 2/15/05.................................. 420,680
-----------------
Total U.S. Treasury Notes..................................... 12,395,008
-----------------
U.S. TREASURY STRIPS (21.4%):
1,200,000 8/15/99......................................... 980,100
550,000 8/15/01......................................... 393,536
1,000,000 8/15/04......................................... 578,170
3,200,000 8/15/05......................................... 1,714,816
-----------------
Total U.S. Treasury Strips.................................... 3,666,622
-----------------
INVESTMENT COMPANIES (3.2%):
554,279 Prairie U.S. Government Securities Cash
Management Fund................................ 554,279
-----------------
Total Investment Companies 554,279
-----------------
TOTAL (COST -- $16,928,130)(A) (97.2%)........................ $ 16,615,909
-----------------
-----------------
</TABLE>
- ---------
Percentages indicated are based on net assets of $17,095,615.
(a) Represents cost for federal income tax purposes and differs from value by
unrealized appreciation (depreciation) of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation......................................................... $ 51,675
Unrealized depreciation......................................................... (363,896)
------------
Net unrealized depreciation..................................................... $ (312,221)
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 39
<PAGE>
LIMITED MATURITY FUND
- -----------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
<C> <S> <C>
ASSET BACKED SECURITIES (4.4%):
768,544 Chase Manhattan Grantor Trust 1995-A, 6.00%,
9/17/01........................................ $ 766,807
194,757 Honda 94-A Auto Receivable, 4.80%, 8/15/99...... 192,928
750,000 MBNA Master Credit Card Trust 1992-1, 7.25%,
6/15/99........................................ 760,455
-----------------
Total Asset Backed Securities................................. 1,720,190
-----------------
COMMERCIAL PAPER (2.6%):
Industrial Food and Beverage (2.6%):
1,000,000 Coca Cola, 5.26%, 6/13/96....................... 993,717
-----------------
Total Commercial Paper........................................ 993,717
-----------------
CORPORATE BONDS (22.3%):
Banking (3.9%):
1,500,000 Bank One (Ind), 7.80%, 12/30/96................. 1,515,000
-----------------
Financial (7.8%):
225,000 American General Finance, 7.15%, 5/15/97........ 228,287
700,000 Commercial Credit, 6.75%, 1/15/97............... 704,739
1,000,000 Ford Motor Credit, 9.25%, 6/15/98............... 1,055,000
1,000,000 General Motors Acceptance Corporation, 7.65%,
1/16/98........................................ 1,020,000
-----------------
3,008,026
-----------------
Industrial Equipment (2.7%):
1,000,000 Paccar Financial Corporation, 8.03%, 4/15/98.... 1,030,000
-----------------
Industrial Food and Beverage (2.6%):
1,000,000 PepsiCo, Inc, 6.13%, 1/15/98.................... 997,500
-----------------
Industrial Goods and Services (1.6%):
600,000 Rockwell International, 7.63%, 2/17/98.......... 612,000
-----------------
Manufacturers of Machinery and Industrial Equipment (3.9%):
1,500,000 Ingersoll-Rand, 6.54%, 8/24/98.................. 1,505,625
-----------------
Total Corporate Bonds......................................... 8,668,151
-----------------
U.S. GOVERNMENT AGENCIES (28.0%):
Federal Home Loan Bank (8.9%):
3,500,000 Federal Home Loan Bank Discount Note, 5.17%,
7/3/96......................................... 3,468,334
-----------------
Federal Home Loan Mortgage Corporation (6.4%):
2,500,000 Federal Home Loan Mortgage Corp Discount Note,
5.19%, 7/9/96.................................. 2,475,131
-----------------
Federal National Mortgage Association (12.7%):
1,000,000 Federal National Mortgage Assn Discount Note,
5.23%, 5/3/96.................................. $ 999,710
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
40 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES (CONTINUED):
2,000,000 Federal National Mortgage Assn Discount Note,
5.18%, 7/23/96................................. 1,976,091
2,000,000 Federal National Mortgage Assn Discount Note,
5.16%, 9/13/96................................. 1,961,300
-----------------
4,937,101
-----------------
Total U.S. Government Agencies................................ 10,880,566
-----------------
U.S. TREASURY NOTES (36.8%):
4,000,000 7.25%, 8/31/96.................................. 4,023,200
1,150,000 6.50%, 11/30/96................................. 1,156,394
1,000,000 7.38%, 11/15/97................................. 1,020,180
2,500,000 7.25%, 11/30/96................................. 2,524,775
4,200,000 6.88%, 2/28/97.................................. 4,241,748
1,300,000 7.38%, 5/15/96.................................. 1,301,313
-----------------
Total U.S. Treasury Notes..................................... 14,267,610
-----------------
TOTAL (COST -- $36,557,035)(A) (94.2%)........................ $ 36,530,234
-----------------
-----------------
</TABLE>
- ---------
Percentages indicated are based on net assets of $38,791,517.
(a) For federal income tax purposes, cost is $36,561,141, and net unrealized
appreciation (depreciation) of securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation........................................................... $ 26,131
Unrealized depreciation........................................................... (57,038)
------------
Net unrealized depreciation....................................................... $ (30,907)
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 41
<PAGE>
SHORT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
<C> <S> <C>
ASSET BACKED SECURITIES (8.7%):
768,544 Chase Manhattan Grantor Trust 1995-A, 6.00%,
9/17/01........................................ $ 766,807
1,500,000 Fleetwood Credit Corporation Grantor Trust
1996-A, 6.75%, 10/17/11........................ 1,501,935
900,000 MBNA Master Credit Card Trust 1992-1A, 7.25%,
6/15/99........................................ 912,546
-----------------
Total Asset Backed Securities................................. 3,181,288
-----------------
COLLATERALIZED MORTGAGE OBLIGATIONS (2.7%):
1,000,000 Federal Home Loan Mortgage Corp, 5.50%,
4/15/13........................................ 993,320
-----------------
Total Collateralized Mortgage Obligations..................... 993,320
-----------------
COMMERCIAL PAPER (2.7%):
Industrial Food and Beverage (2.7%):
1,000,000 Coca Cola, 5.26%, 6/13/96....................... 993,717
-----------------
Total Commercial Paper........................................ 993,717
-----------------
CORPORATE BONDS (24.5%):
Banking (4.5%):
250,000 Citicorp, 6.65%, 5/15/00........................ 247,813
500,000 Citicorp, 6.60%, 8/1/00......................... 493,750
900,000 Wachovia Bank, 7.00%, 12/15/99.................. 911,250
-----------------
1,652,813
-----------------
Computer Hardware (1.1%):
400,000 IBM Corp, 6.38%, 6/15/00........................ 395,500
-----------------
Consumer Goods and Services (3.2%):
1,000,000 Disney Global Bond, 6.38%, 3/30/01.............. 985,000
200,000 Walmart, 5.50%, 3/1/98.......................... 197,000
-----------------
1,182,000
-----------------
Electric Utility (2.0%):
750,000 Puget Sound Power & Light, 6.50%, 9/14/99....... 745,312
-----------------
Financial (9.3%):
225,000 American General Finance, 7.15%, 5/15/97........ 228,287
900,000 Commercial Credit, 6.75%, 1/15/97............... 906,093
850,000 General Motors Acceptance Corp, 7.63%, 5/5/03... 873,375
900,000 Ingersoll Rand, 6.55%, 8/7/00................... 893,250
500,000 Paccar Financial Corp, 5.90%, 9/15/99........... 487,500
-----------------
3,388,505
-----------------
Industrial Goods and Services (0.6%):
200,000 Rockwell International, 7.63%, 2/17/98.......... 204,000
-----------------
Master Demand Notes (1.4%):
500,000 R.R. Donnelley, 6.03%, 6/22/98.................. $ 496,875
-----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
42 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
<C> <S> <C>
CORPORATE BONDS (CONTINUED):
Telecommunications (2.4%):
900,000 AT&T Capital Corp, 5.90%, 7/10/98............... 889,875
-----------------
Total Corporate Bonds......................................... 8,954,880
-----------------
MORTGAGE-BACKED SECURITIES (0.5%):
198,835 Federal National Mortgage Assn, 7.00%, 8/1/08... 196,660
-----------------
Total Mortgage-Backed Securities.............................. 196,660
-----------------
U.S. TREASURY NOTES (65.5%):
200,000 6.88%, 10/31/96................................. 201,444
770,000 7.25%, 11/15/96................................. 777,269
1,100,000 6.50%, 5/15/97.................................. 1,108,591
780,000 6.75%, 5/31/97.................................. 788,018
250,000 5.88%, 7/31/97.................................. 250,103
800,000 6.50%, 8/15/97.................................. 806,072
1,300,000 5.38%, 11/30/97................................. 1,288,209
1,500,000 5.13%, 2/28/98.................................. 1,476,210
1,500,000 5.88%, 8/15/98.................................. 1,491,765
4,100,000 5.50%, 11/15/98................................. 4,035,261
500,000 6.75%, 5/31/99.................................. 506,595
2,100,000 8.00%, 8/15/99.................................. 2,202,963
2,000,000 6.88%, 8/31/99.................................. 2,033,220
3,000,000 6.75%, 4/30/00.................................. 3,037,530
3,000,000 5.50%, 12/31/00................................. 2,889,150
1,100,000 6.25%, 2/15/03.................................. 1,081,322
-----------------
Total U.S. Treasury Notes..................................... 23,973,722
-----------------
INVESTMENT COMPANIES (2.1%):
771,934 Prairie U.S. Government Securities Cash
Management Fund................................ 771,934
-----------------
Total Investment Companies.................................... 771,934
-----------------
TOTAL (COST -- $39,445,605)(A) (106.7%)....................... $ 39,065,521
-----------------
-----------------
</TABLE>
- ---------
Percentages indicated are based on net assets of $36,622,187.
(a) For federal income tax purposes, cost is $39,464,589, and net unrealized
appreciation (depreciation) of securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation.......................................................... $ 42,799
Unrealized depreciation.......................................................... (441,847)
------------
Net unrealized depreciation...................................................... $ (399,048)
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 43
<PAGE>
INTERMEDIATE BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL AMOUNT SECURITY DESCRIPTION MARKET VALUE
- ---------------- -------------------------------------------------- ------------
<C> <S> <C>
ASSET BACKED SECURITIES (8.1%):
768,544 Chase Manhattan Grantor Trust 1995-A, 6.00%,
9/17/01.......................................... $ 766,807
329,588 Honda 94-A Auto Receivables, 4.80%, 8/15/99....... 326,493
1,500,000 Premier Auto Trust 94-3A6, 6.85%, 3/2/99.......... 1,515,390
------------
Total Asset Backed Securities.................................... 2,608,690
------------
CORPORATE BONDS (40.5%):
Banking (10.2%):
850,000 Citicorp, 6.65%, 5/15/00.......................... 842,562
1,500,000 First Bank Systems Subordinate Notes, 6.88%,
9/15/07.......................................... 1,438,125
1,000,000 Old Kent Bank, 6.88%, 4/15/98..................... 1,012,500
------------
3,293,187
------------
Consumer Goods and Services (3.0%):
1,000,000 Disney Global Bond, 6.38%, 3/30/01................ 985,000
------------
Electric Utility (4.6%):
1,500,000 Puget Sound Power & Light, 6.50%, 9/14/99......... 1,490,625
------------
Financial (12.0%):
600,000 American General Finance, 7.15%, 5/15/97.......... 608,766
1,500,000 CIT Group Holdings, 6.63%, 6/15/05................ 1,443,750
1,000,000 Paccar Financial Corp, 5.90%, 9/15/99............. 975,000
850,000 Transamerica Financial Corp, 7.40%, 7/29/99....... 865,938
------------
3,893,454
------------
Industrial Goods and Services (6.1%):
1,000,000 Hanson Overseas, PLC, 6.75%, 9/15/05.............. 951,250
1,000,000 Rockwell International, 7.63%, 2/17/98............ 1,020,000
------------
1,971,250
------------
Telecommunications (4.6%):
1,500,000 AT&T Capital Corp, 5.90%, 7/10/98................. 1,483,125
------------
Total Corporate Bonds............................................... 13,116,641
------------
MORTGAGE-BACKED SECURITIES (14.0%):
1,642,552 Federal National Mortgage Assn, 7.00%, 8/1/08..... 1,624,582
1,907,647 Federal National Mortgage Assn, 7.00%, 2/1/24..... 1,839,086
1,132,520 Government National Mortgage Assn, 6.50%,
4/15/24.......................................... 1,059,960
------------
Total Mortgage-Backed Securities.................................... 4,523,628
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
44 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL AMOUNT SECURITY DESCRIPTION MARKET VALUE
- ---------------- -------------------------------------------------- ------------
U.S. GOVERNMENT AGENCIES (4.2%):
<C> <S> <C>
Tennessee Valley Authority (4.2%):
1,400,000 6.38%, 6/15/05.................................... $1,349,250
------------
Total U.S. Government Agencies................................... 1,349,250
------------
U.S. TREASURY NOTES (12.1%):
3,925,000 6.38%, 1/15/00.................................... 3,928,925
------------
Total U.S. Treasury Notes........................................... 3,928,925
------------
U.S. TREASURY STRIPS (17.8%):
850,000 2/15/02........................................... 587,597
4,975,000 8/15/02........................................... 3,321,111
3,150,000 5/15/04........................................... 1,851,570
------------
Total U.S. Treasury Strips.......................................... 5,760,278
------------
INVESTMENT COMPANIES (2.4%):
761,416 Prairie U.S. Government Securities Cash
Management Fund.................................. 761,416
------------
Total Investment Companies.......................................... 761,416
------------
TOTAL (COST -- $32,615,956)(A) (99.1%).............................. $32,048,828
------------
------------
</TABLE>
- ---------
Percentages indicated are based on net assets of $32,353,241.
(a) Represents cost for federal income tax purposes and differs from value by
unrealized appreciation (depreciation) of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation.......................................................... $ 106,841
Unrealized depreciation.......................................................... (673,969)
---------
Net unrealized depreciation...................................................... $(567,128)
---------
---------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 45
<PAGE>
OPPORTUNITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
<C> <S> <C>
ASSET BACKED SECURITIES (0.5%):
165,399 General Motors Acceptance Corp, 7.15%,
3/15/00........................................ $ 167,274
-----------------
Total Asset Backed Securities................................. 167,274
-----------------
COMMERCIAL PAPER (3.2%):
1,000,000 General Electric Credit Corp, 5.28%, 8/13/96.... 984,747
-----------------
Total Commercial Paper........................................ 984,747
-----------------
CORPORATE BONDS (28.9%):
Banking (2.2%):
200,000 Citicorp, 6.65%, 5/15/00........................ 198,250
500,000 First Bank Systems Subordinate Notes, 6.88%,
9/15/07........................................ 479,375
-----------------
677,625
-----------------
Computer Hardware (4.9%):
1,500,000 IBM Corp, 7.50%, 6/15/13........................ 1,505,625
-----------------
Consumer Goods and Services (4.1%):
1,000,000 Disney Global Bond, 6.38%, 3/30/01.............. 985,000
300,000 Walmart, 5.50%, 3/1/98.......................... 295,500
-----------------
1,280,500
-----------------
Electric Utility (3.2%):
500,000 Union Electric, 6.88%, 8/1/04................... 493,125
500,000 Virginia Electric Power Co, 7.38%, 7/1/02....... 508,750
-----------------
1,001,875
-----------------
Financial (12.1%):
500,000 General Motors Acceptance Corp, 8.63%,
6/15/99........................................ 526,875
1,000,000 General Motors Acceptance Corp, 7.75%,
1/15/99........................................ 1,027,500
400,000 CIT Group Holdings, 6.63%, 6/15/05.............. 385,000
1,500,000 Grand Metropolitan Investment, 8.63%, 8/15/01... 1,618,125
190,000 Transamerica Financial Corp, 7.40%, 7/29/99..... 193,563
-----------------
3,751,063
-----------------
Industrial Goods and Services (2.4%):
500,000 Hanson Overseas, PLC, 6.75%, 9/15/05............ 475,625
250,000 Rockwell International, 7.63%, 2/17/98.......... 255,000
-----------------
730,625
-----------------
Total Corporate Bonds......................................... 8,947,313
-----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
46 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------ -----------------
FOREIGN GOVERNMENT BONDS (2.9%):
<C> <S> <C>
1,000,000 British Columbia, 6.50%, 1/15/26................ $ 892,500
-----------------
Total Foreign Government Bonds................................ 892,500
-----------------
MORTGAGE-BACKED SECURITIES (24.5%):
1,199,746 Federal Home Loan Mortgage Corp, 6.50%,
10/1/10........................................ 1,164,126
1,400,000 Federal Home Loan Mortgage Corp, 8.50%,
6/1/17......................................... 1,438,500
966,286 Government National Mortgage Assn, 6.50%,
1/15/24........................................ 904,376
476,912 Federal National Mortgage Assn, 7.00%, 2/1/24... 459,772
371,068 Government National Mortgage Assn, 6.50%,
4/15/24........................................ 347,293
485,733 Government National Mortgage Assn, 6.50%,
5/15/24........................................ 454,612
491,645 Federal National Mortgage Assn, 7.00%, 6/1/24... 473,975
966,476 Federal Home Loan Mortgage Corp, 7.00%,
9/1/25......................................... 933,249
1,514,814 Federal National Mortgage Assn, 6.50%,
10/1/25........................................ 1,421,077
-----------------
Total Mortgage-Backed Securities.............................. 7,596,980
-----------------
U.S. GOVERNMENT AGENCIES (30.9%):
Federal Home Loan Bank (4.5%):
1,300,000 8.09%, 12/28/04................................. 1,392,508
-----------------
Tennessee Valley Authority (1.9%):
600,000 6.38%, 6/15/05.................................. 578,250
-----------------
Total U.S. Government Agencies................................ 9,567,738
-----------------
U.S. TREASURY NOTES (20.9%):
300,000 5.38%, 11/30/97................................. 297,279
1,000,000 7.75%, 11/30/99................................. 1,044,130
1,000,000 5.75%, 10/31/00................................. 974,280
1,000,000 6.38%, 3/31/01.................................. 997,000
3,000,000 7.50%, 2/15/05.................................. 3,155,100
-----------------
Total U.S. Treasury Notes..................................... 6,467,789
-----------------
U.S. TREASURY BONDS (5.1%):
400,000 8.13%, 8/15/19.................................. 446,048
800,000 8.13%, 8/15/21.................................. 895,072
250,000 7.25%, 8/15/22.................................. 254,542
-----------------
Total U.S. Treasury Bonds..................................... 1,595,662
-----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 47
<PAGE>
OPPORTUNITY FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT SECURITY DESCRIPTION MARKET VALUE
------------ ------------------------------------------------- -----------------
U.S. TREASURY STRIPS (4.5%):
<C> <S> <C>
2,960,000 8/15/14.......................................... $ 804,676
4,125,000 2/15/24.......................................... 590,287
-----------------
Total U.S. Treasury Strips..................................... 1,394,963
-----------------
INVESTMENT COMPANIES (1.9%):
601,746 Prairie U.S. Government Securities Cash
Management Fund................................. 601,746
-----------------
Total Investment Companies..................................... 601,746
-----------------
TOTAL (COST -- $31,605,108)(A) (98.8%)......................... $ 30,619,732
-----------------
-----------------
</TABLE>
- ---------
Percentages indicated are based on net assets of $31,007,190.
(a) Represents cost for federal income tax purposes and differs from value by
unrealized appreciation (depreciation) of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation......................................................... $ 53,580
Unrealized depreciation......................................................... (1,038,956)
----------
Net unrealized depreciation..................................................... $ (985,376)
----------
----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
48 Payden & Rygel Investment Group
<PAGE>
MARKET RETURN FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL AMOUNT SECURITY DESCRIPTION MARKET VALUE
- ---------------- -------------------------------------------------- ------------
<C> <S> <C>
CORPORATE BONDS (16.3%):
Brokerage (3.3%):
100,000 Lehman Brothers Holding, 8.38%, 2/15/99 (a)....... $ 103,875
------------
Financial (13.0%):
100,000 CIT Group Holdings, 6.63%, 6/15/05 (a)............ 96,250
100,000 Commercial Credit, 5.55%, 2/15/01 (a)............. 94,750
100,000 Ford Motor Credit, 8.20%, 2/15/02 (a)............. 105,500
100,000 General Motors, 9.13%, 7/15/01 (a)................ 109,000
------------
405,500
------------
Total Corporate Bonds............................................... 509,375
------------
MORTGAGE-BACKED SECURITIES (16.8%):
400,000 Federal Home Loan Mortgage Corp, 7.50%, 1/1/26
(a).............................................. 395,748
129,751 Federal Home Loan Mortgage Corp, 7.50%, 2/1/26
(a).............................................. 128,372
------------
Total Mortgage-Backed Securities.................................... 524,120
------------
U.S. TREASURY NOTES (56.3%):
120,000 5.50%, 7/31/97 (a)................................ 119,573
115,000 5.63%, 1/31/98 (a)................................ 114,280
275,000 6.38%, 7/15/99 (a)................................ 275,712
35,000 6.13%, 7/31/00 (a)................................ 34,633
495,000 7.25%, 8/15/04 (a)................................ 512,345
440,000 7.50%, 2/15/05 (a)................................ 462,748
240,000 6.50%, 5/15/05 (a)................................ 236,621
------------
Total U.S. Treasury Notes........................................... 1,755,912
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 49
<PAGE>
MARKET RETURN FUND (CONTINUED)
- -----------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS
APRIL 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL AMOUNT SECURITY DESCRIPTION MARKET VALUE
- ---------------- -------------------------------------------------- ------------
U.S. TREASURY BONDS (2.2%):
<C> <S> <C>
75,000 6.25%, 8/15/23 (a)................................ $ 67,634
------------
Total U.S. Treasury Bonds........................................... 67,634
------------
INVESTMENT COMPANIES (8.3%):
120,811 Prairie U.S. Government Securities Cash Management
Fund............................................. 120,811
2,100 Standard & Poors Depository Receipts (a).......... 137,320
------------
Total Investment Companies.......................................... 258,131
------------
TOTAL (COST -- $3,178,211)(B) (99.9%)............................... $ 3,115,172
------------
------------
</TABLE>
- ---------
Percentages indicated are based on net assets of $3,119,371.
(a) A portion of the security is held by the custodian in a segregated account
as collateral for open futures contracts.
At April 30, 1996, the Fund's open futures contracts were as follows:
<TABLE>
NUMBER OF EXPIRATION NOTIONAL CURRENT
CONTRACTS CONTRACT TYPE DATE AMOUNT MARKET VALUE
- ---------- ---------------------------------- --------- --------- ------------
<C> <S> <C> <C> <C>
7 S&P 500 Future June 1996 6/20/96 $2,275,200 $ 2,291,975
2 S&P 500 Future Sept 1996 9/19/96 660,600 660,350
</TABLE>
(b) For federal income tax purposes, cost is $3,181,507, and net unrealized
appreciation (depreciation) of securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation.......................................................... $ 1,974
Unrealized depreciation.......................................................... (68,309)
---------
Net unrealized depreciation...................................................... $ (66,335)
---------
---------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
50 Payden & Rygel Investment Group
<PAGE>
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1996 (UNAUDITED)
1. ORGANIZATION
Payden & Rygel Global Fixed Income Fund, Payden & Rygel International Bond
Fund, Payden & Rygel Short Duration Tax Exempt Fund, Payden & Rygel Tax
Exempt Bond Fund, Payden & Rygel U.S. Treasury Fund, Payden & Rygel
Limited Maturity Fund, Payden & Rygel Short Bond Fund, Payden & Rygel
Intermediate Bond Fund, Payden & Rygel Opportunity Fund and Payden & Rygel
Market Return Fund (the Equity Market Tracking Fund prior to February 7,
1996) (the "Funds") are non-diversified series of Payden & Rygel
Investment Group ("Group"), a Massachusetts business trust organized on
January 22, 1992. The Group is registered under the Investment Company Act
of 1940, as amended, as an open-end management investment company.
The objective of the Global Fixed Income, International Bond, U.S.
Treasury, Limited Maturity, Short Bond, Intermediate Bond and Opportunity
Funds is to realize a high level of total return consistent with
preservation of capital. The Limited Maturity Fund further seeks to earn a
total return that, over time, is greater than that available from money
market funds. In order to achieve these objectives, each Fund invests
primarily in debt obligations. The Limited Maturity, Short Bond,
Intermediate Bond and Opportunity Funds invest in debt obligations of the
U.S. Treasury, U.S. government agencies, U.S. dollar-denominated foreign
and domestic public corporations and mortgage-backed securities. The U.S.
Treasury Fund primarily invests in U.S. Treasury securities guaranteed by
the full faith and credit of the United States Government. The Global
Fixed Income and International Bond Funds invest primarily in U.S. and
foreign government notes and bonds and U.S. and foreign corporate debt
securities. The Global Fixed Income and International Bond Funds can also
have substantial investments in foreign currency contracts. The objective
of the Short Duration Tax Exempt and Tax Exempt Bond Funds is to earn
federal tax-free income by investing in debt obligations which are exempt
from federal income tax and consistent with preservation of capital. The
objective of the Market Return Fund is to provide a total return in excess
of the Standard & Poor's 500 Stock Index. To achieve this objective, the
Market Return Fund invests primarily in equity-based investments, such as
stock index futures contracts and equity swap contracts, as well as in
fixed income securities. There can, however, be no assurance that any of
the Funds' investment objectives will be achieved.
The Funds offer both Class A and Class B shares; however, as of April 30,
1996, there have been no Class B shares issued. Class B shares are subject
to certain fees
Semi-Annual Report 51
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
APRIL 30, 1996 (UNAUDITED)
under a shareholder service plan (the "Plan"); Class A shares do not
participate in the Plan. Both classes of shares have identical rights and
privileges except with respect to the shareholder service fees borne by
Class B and voting rights on matters affecting a single class. The Group
is authorized to issue an unlimited number of shares of each class which
are units of beneficial interest with a par value of $.001 per share.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Funds:
SECURITIES VALUATION
Portfolio securities are valued on the basis of quotations obtained from
dealers or from a pricing service with consideration of such factors as
institutional-sized trading in similar groups of securities, quality,
yield, coupon rate, maturity, type of issue, trading characteristics and
other market data. Options, futures, swaps and other similar assets are
valued at the last available bid price in the case of listed securities or
on the basis of information provided by brokers in the case of other
securities. Securities for which market quotations are not readily
available are valued at fair value as determined in good faith pursuant to
guidelines established by the Board of Trustees. Debt securities with
remaining maturities of sixty days or less are valued on an amortized cost
basis unless Payden & Rygel (the "Adviser") determines that such basis
does not represent fair value.
INVESTMENT TRANSACTIONS AND RELATED INCOME
Investment transactions are accounted for on the date the security is
purchased or sold (trade date). Interest income is recognized on the
accrual basis. All premiums or original issue discounts are amortized or
accreted for both financial statement and tax reporting purposes as
required by Federal income tax regulations. Dividend income is recorded on
the ex-dividend date. Realized gains or losses on investment transactions
are determined on the identified cost basis.
FOREIGN CURRENCY TRANSLATION
The accounting records of the Funds are maintained in U.S. dollars. The
Global Fixed Income and International Bond Funds may purchase debt
obligations that are payable in a foreign currency. For these two Funds,
investment securities, other
52 Payden & Rygel Investment Group
<PAGE>
assets and liabilities denominated in a foreign currency are translated
into U.S. dollars at the current exchange rate. Purchases and sales of
securities, income receipts and expense payments are translated into U.S.
dollars at the exchange rate on the dates of the transactions.
Each of these two Funds isolates that portion of the results of operations
resulting from changes in foreign exchange rates on investments from the
fluctuation arising from changes in market prices of securities held.
Reported net realized foreign exchange gains or losses arise from sales
and maturities of securities, purchases and sales of foreign currencies,
currency gains or losses realized between the trade and settlement dates
of securities transactions, and the difference between the amount of
interest or expenses recorded on each of these Fund's books and the U.S.
dollar equivalent of the amounts actually received or paid. Net unrealized
foreign exchange gains and losses arise from changes in the value of
assets and liabilities, including investments in securities, resulting
from changes in the exchange rate.
REPURCHASE AGREEMENTS
Any of the Funds may enter into repurchase agreements (agreements to
purchase U.S. Treasury notes and bills, subject to the seller's agreement
to repurchase them at a specified time and price) with well-established
registered securities dealers or banks. Repurchase agreements are the
equivalent of loans by the Funds. With respect to such agreements, it is
each Fund's policy to take possession of the underlying securities and, on
a daily basis, mark-to-market such securities to ensure that the value,
including accrued interest, is at least equal to the amount to be repaid
to each Fund under each agreement.
OPTIONS TRANSACTIONS
When any of the Funds (except the U.S. Treasury Fund which does not invest
in any option transactions) writes a covered call or put option, an amount
equal to the premium received is included in that Fund's statement of
assets and liabilities as a liability. The amount of the liability is
subsequently marked-to-market to reflect the current market value of the
option. If an option expires on its stipulated expiration date or if the
Fund enters into a closing purchase transaction, a gain or loss is
realized. If a written call option is exercised, a gain or loss is
realized for the
Semi-Annual Report 53
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
APRIL 30, 1996 (UNAUDITED)
sale of the underlying security and the proceeds from the sale are
increased by the premium originally received. If a written put option is
exercised, the cost of the security acquired is decreased by the premium
originally received.
When any of the Funds (except the U.S. Treasury Fund which does not invest
in any option transactions) purchases a call or put option, an amount
equal to the premium paid is included in that Fund's statement of assets
and liabilities as an investment, and is subsequently marked-to-market to
reflect the current market value of the option. If an option expires on
the stipulated expiration date or if a Fund enters into a closing sale
transaction, a gain or loss is realized. If a Fund exercises a call
option, the cost of the security acquired is increased by the premium paid
for the call. If a Fund exercises a put option, a gain or loss is realized
from the sale of the underlying security, and the proceeds from such sale
are decreased by the premium originally paid. Written and purchased
options are non-income producing securities.
The options techniques utilized are to hedge against changes in interest
rates, foreign currency exchange rates or securities prices in order to
establish more definitely the effective return on securities or currencies
held or intended to be acquired by a Fund, to reduce the volatility of the
currency exposure associated with investment in non-U.S. securities, or as
an efficient means of adjusting exposure to the bond, equity and currency
markets and not for speculation.
FUTURES CONTRACTS
Any Fund (except the U.S. Treasury Fund) may purchase or sell futures
contracts and options on futures contracts which provide for the future
sale by one party and purchase by another party of a specified quantity of
a financial instrument or foreign currency at a fixed price on a future
date. Upon entering into such a contract, a Fund is required to deposit
and maintain as collateral such initial margin as required by the exchange
on which the contract is traded. Pursuant to the contract, that Fund
agrees to receive from or pay to the broker an amount equal to the daily
fluctuations in the value of the contract. Such receipts or payments are
known as variation margin and are recorded as unrealized gains or losses
by that Fund. When the contract is closed, that Fund records a realized
gain or loss equal to the difference between the value of the contract at
the time it was opened and the value at the time it was closed. The Funds
invest in futures contracts to hedge against anticipated future changes in
interest or exchange rates or security prices. The potential risk to the
Funds is that the change in value of the underlying securities may not
correlate to the change in value of the contracts.
54 Payden & Rygel Investment Group
<PAGE>
The Market Return Fund may invest in stock index futures contracts which
are an agreement pursuant to which two parties agree to take or make
delivery of an amount of cash equal to the difference between the value of
the index at the close of the last trading day of the contract and the
price at which the index contract was originally written. Variation margin
accounting procedures as discussed above apply to these index futures
contracts. This Fund invests in these futures contracts, combined with a
fixed income portfolio, to permit the Fund to meet its objectives at a
lower cost than investing directly in equity securities, while permitting
the equivalent of an investment in a portfolio of equity securities. The
potential risk to the Fund is that the change in value of the underlying
index may not correlate to the change in value of the contracts.
EQUITY SWAP CONTRACTS
The Market Return Fund may enter into equity swap transactions which
involve an agreement between the Fund and another party to exchange
payments calculated as if they were interest on a fictitious ("notional")
principal amount. The Fund will typically pay a floating rate of interest
and receive the total return of a specified equity index. The Fund usually
enters into such transactions on a "net" basis, with the Fund receiving or
paying, as the case may be, only the net amounts of the two payment
streams. The net amount of the excess or deficiency, if any, of the Fund's
obligations over its entitlements with respect to each swap is accrued on
a daily basis and is recorded as an unrealized gain or loss by the Fund.
The Fund invests in these swap transactions to permit the Fund to meet its
objectives at a lower cost than investing directly in equity securities,
while permitting the equivalent of an investment in a portfolio of equity
securities. The potential risk to the Fund is that the swap position may
correlate imperfectly with the markets or the asset or liability being
hedged.
FORWARD CURRENCY CONTRACTS
The Global Fixed Income and International Bond Funds each may enter into
forward foreign currency exchange contracts for the purchase or sale of a
specific foreign currency at a fixed price on a future date. Risks may
arise upon entering these contracts from the potential inability of
counter parties to meet the terms of their contracts and from
unanticipated movements in the value of a foreign currency relative to the
U.S. dollar. These two Funds will enter into forward contracts as a hedge
against specific transactions or portfolio positions to protect against
adverse currency movements. The forward foreign currency exchange
contracts are adjusted by the daily exchange rate of the underlying
currency and
Semi-Annual Report 55
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
APRIL 30, 1996 (UNAUDITED)
any gains or losses are recorded for financial statement purposes as
unrealized until the contract settlement date, at which time a Fund
records a realized gain or loss equal to the difference between the value
of the contract at the time it was opened and the value at the time it was
closed.
DELAYED DELIVERY TRANSACTIONS
Any of the Funds may purchase securities on a when issued or delayed
delivery basis and sell securities on a delayed delivery basis. These
transactions involve a commitment by a Fund to purchase or sell securities
for a predetermined price or yield with payment and delivery taking place
more than seven days in the future, or after a period longer than the
customary settlement period for that type of security. No interest will be
earned by a Fund on such purchases until the securities are delivered;
however, the market value may change prior to delivery. There were no such
commitments included in any Fund's schedule of portfolio investments at
April 30, 1996.
DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded on the ex-dividend date.
Dividends from net investment income and net realized gains on foreign
currency transactions are declared and paid monthly, except for the
International Bond Fund which are paid quarterly, and net realized gains
on investments, if any, are declared and distributed at least annually.
All distributions are paid in the form of additional shares unless cash
payment is requested.
Distributions to shareholders are determined in accordance with income tax
regulations which may differ from generally accepted accounting
principles.
FEDERAL INCOME TAXES
It is the policy of each Fund to meet the requirements for qualification
as a regulated investment company as defined in applicable sections of the
Internal Revenue Code (the "Code"), and to make distributions of net
investment income and net realized gains sufficient to relieve it from all
Federal income or excise taxes. Accordingly, no provision for Federal
income or excise tax is necessary.
Each Fund files a tax return annually using tax accounting methods
required under provisions of the Code which may differ from generally
accepted accounting principles, the basis on which these financial
statements are prepared. The
56 Payden & Rygel Investment Group
<PAGE>
differences arise primarily from the treatment of foreign currency
transactions and futures contracts and the deferral of certain losses
under Federal income tax regulations. Accordingly, the amount of net
investment income and net realized gains or losses reported in these
financial statements may differ from that reported in each Fund's tax
return and, consequently, the character of distributions to shareholders
reported in the financial highlights may differ from that reported to
shareholders for Federal income tax purposes.
ESTIMATES
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 income and expenses
during the reporting period. Actual results could differ from those
estimates.
OTHER
Shared expenses incurred by the Group are allocated among the series of
the Group on the basis of relative net assets. Series-specific expenses
are charged to each series as incurred. Fund expenses not specific to any
class will be allocated between the classes based upon net assets of each
class. Class-specific expenses will be charged to each class as incurred.
Semi-Annual Report 57
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
APRIL 30, 1996 (UNAUDITED)
3. PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of investments (excluding short-term investments and
long-term U.S. Government securities) for the six months ended April 30,
1996 (from December 1, 1995 to April 30, 1996 [period from commencement of
operations] for the Market Return Fund) were as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
------------ ------------
<S> <C> <C>
Global Fixed Income Fund........................ $342,695,446 $237,156,209
International Bond Fund......................... 21,888,622 20,343,718
Short Duration Tax Exempt Fund.................. 3,505,180 5,197,300
Tax Exempt Bond Fund............................ 17,281,586 2,657,816
U.S. Treasury Fund.............................. 0 0
Limited Maturity Fund........................... 8,627,195 985,316
Short Bond Fund................................. 5,769,176 185,316
Intermediate Bond Fund.......................... 3,533,671 367,439
Opportunity Fund................................ 5,381,595 0
Market Return Fund.............................. 785,719 146,113
</TABLE>
Purchases and sales of long-term U.S. Government securities for the six
months ended April 30, 1996 (from December 1, 1995 to April 30, 1996
[period from commencement of operations] for the Market Return Fund) were
as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
------------ -----------
<S> <C> <C>
Global Fixed Income Fund......................... $115,589,516 $82,012,313
International Bond Fund.......................... 350,547 765,222
Short Duration Tax Exempt Fund................... 0 0
Tax Exempt Bond Fund............................. 0 0
U.S. Treasury Fund............................... 9,116,030 2,797,039
Limited Maturity Fund............................ 23,760,492 20,857,259
Short Bond Fund.................................. 25,267,203 11,410,560
Intermediate Bond Fund........................... 16,585,452 20,663,659
Opportunity Fund................................. 15,136,365 14,971,914
Market Return Fund............................... 3,845,182 1,389,991
</TABLE>
None of the Funds had activity in written options for the six months ended
April 30, 1996 (from December 1, 1995 to April 30, 1996 [period from
commencement of operations] for the Market Return Fund).
58 Payden & Rygel Investment Group
<PAGE>
4. UNAMORTIZED ORGANIZATION COSTS
The organization costs incurred on behalf of the Funds are being
reimbursed to the Adviser and are being amortized on a straight-line basis
over a period not exceeding five years. The organization costs and the
amounts reimbursed as of April 30, 1996 are as follows:
<TABLE>
<CAPTION>
AMORTIZED
ORGANIZATION ORGANIZATION
COSTS EXPENSES
------------- -------------
<S> <C> <C>
Global Fixed Income Fund........................ $ 90,199 $ 65,811
International Bond Fund......................... 5,322 1,129
Short Duration Tax Exempt Fund.................. 6,170 2,513
Tax Exempt Bond Fund............................ 15,168 7,062
U.S. Treasury Fund.............................. 3,926 1,207
Limited Maturity Fund........................... 4,939 3,882
Short Bond Fund................................. 837 837
Intermediate Bond Fund.......................... 837 837
Opportunity Fund................................ 837 837
Market Return Fund.............................. 39,401 3,167
</TABLE>
Any redemption by the Adviser of its initial investment of $100,000 will
reduce the reimbursement by a prorata portion of any of the then
unamortized organization costs.
5. RELATED PARTY TRANSACTIONS
Investment advisory services are provided to the Funds by Payden & Rygel.
Under the terms of the investment advisory agreement, the Adviser is
entitled to receive fees monthly, computed on the average daily net assets
of each of the Funds separately at an annualized rate. The rate for the
Global Fixed Income and International Bond Funds is .37% on net assets up
to $200 million, decreasing to .18% on net assets over $1.5 billion. The
rate for the Short Duration Tax Exempt and Tax Exempt Bond Funds is .32%
on net assets up to $500 million, decreasing to .25% on net assets over $1
billion. The rate for the U.S. Treasury, Limited Maturity, Short Bond,
Intermediate Bond, Opportunity and Market Return Funds is .28% on net
assets up to $1 billion, decreasing to .25% on net assets over $1 billion.
Semi-Annual Report 59
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
APRIL 30, 1996 (UNAUDITED)
The Adviser has agreed to guarantee that, for so long as it acts as
investment adviser to a Fund, the expenses of a Fund attributable to Class
A Shares, including advisory fees (but excluding interest, taxes,
portfolio transaction expenses, blue sky fees, 12b-1 plan fees [if any
such plan is adopted in the future] and extraordinary expenses will not
exceed the percentage indicated below of that Fund's average daily net
assets on an annualized basis. In addition, the Adviser has voluntarily
agreed to temporarily limit each Fund's total expenses, including advisory
fees, to the percentage indicated below of that Fund's average daily net
assets on an annualized basis through October 31, 1996 (exclusive of
interest, taxes, portfolio transaction expenses, blue sky fees, 12b-1 plan
fees [if any such plan is adopted in the future] and extraordinary
expenses). From January 1, 1996 through June 30, 1996, the Adviser has
agreed to limit the Market Return Fund's total expenses, including
advisory fees, to 0.0% of the average daily net assets on an annualized
basis.
<TABLE>
<CAPTION>
EXPENSE
GUARANTEE EXPENSE LIMIT
--------------- -------------
<S> <C> <C>
Global Fixed Income Fund.............................. .70% .70%
International Bond Fund............................... .70% .70%
Short Duration Tax Exempt Fund........................ .60% .45%
Tax Exempt Bond Fund.................................. .60% .45%
U.S. Treasury Fund.................................... .60% .45%
Limited Maturity Fund................................. .60% .30%
Short Bond Fund....................................... .60% .40%
Intermediate Bond Fund................................ .60% .45%
Opportunity Fund...................................... .60% .45%
Market Return Fund.................................... .60% .45%
</TABLE>
Each Fund remains liable to the Adviser for expenses subsidized in any
fiscal year so long as any reimbursement will not cause the annual expense
ratio for the year in which it is made to exceed the amount of the expense
guarantee or expense limit (whichever is in effect at the time of
reimbursement). The remaining deferred expense subsidies will be
recognized in the statement of operations in future periods, if expense
limits permit.
60 Payden & Rygel Investment Group
<PAGE>
Certain expenses incurred by the Funds are paid directly by Payden & Rygel
subject to subsequent reimbursement by the Funds. As of April 30, 1996,
the amounts paid by Payden & Rygel for expenses actually incurred by the
Funds and the reimbursement of expenses previously paid are as follows:
<TABLE>
<CAPTION>
EXPENSES PAID BY REIMBURSEMENT OF
PAYDEN & RYGEL EXPENSES PAID
---------------- ----------------
<S> <C> <C>
International Bond Fund................. $ 132,268 $ 105,003
Short Duration Tax Exempt Fund.......... 175,691 132,056
Tax Exempt Bond Fund.................... 316,598 308,014
U.S. Treasury Fund...................... 111,116 56,089
Limited Maturity Fund................... 177,532 86,538
Short Bond Fund......................... 172,461 84,053
Intermediate Bond Fund.................. 217,823 200,490
Opportunity Fund........................ 177,616 99,597
Market Return Fund...................... 75,838 0
</TABLE>
The Adviser has incurred certain expenses in connection with the offering
of multiple class shares that will be charged to the Group upon the
initial sale of Class B shares to the public. Such expenses, approximately
$41,000 as of April 30, 1996, will be allocated to all series of the Group
that offer Class B shares on the basis of relative net assets at the time
of the initial sale of Class B shares, and will be prorated between the
classes on the basis of eligible net assets of each class over a five year
period.
Payden & Rygel Distributors, a subsidiary of Payden & Rygel, serves as the
distributor for the Funds and is not entitled to receive any fees from the
Group under the distribution agreement.
Through December 31, 1995, BISYS Fund Services ("BISYS"), a subsidiary of
the BISYS Group, Inc., served as administrator to the Group. Under the
terms of the administration agreement, BISYS received fees monthly,
computed on the average daily net assets of the Funds at an annualized
rate of .10% on net assets up to $250 million and decreasing to .02% on
net assets over $1 billion.
Effective January 1, 1996, Treasury Plus, Inc., a subsidiary of Payden &
Rygel, serves as administrator to the Group. Treasury Plus, Inc. has
served as
Semi-Annual Report 61
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
APRIL 30, 1996 (UNAUDITED)
administrator for the Market Return Fund since December 1, 1995
(commencement of operations). Under the terms of the administration
agreement, Treasury Plus, Inc. receives fees monthly, computed on the
average daily net assets of the Group at an annualized rate of .06%.
Through November 10, 1995, BISYS served as transfer agent to the Group.
Under the terms of the transfer agency agreement, BISYS received fees
monthly, based upon a specified amount per shareholder with specified
minimum-per-Fund amounts and surcharges, plus certain out-of-pocket
expenses. BISYS also served as fund accountant through December 31, 1995.
Under the terms of the fund accounting agreement, BISYS received fees
monthly at an annual rate of $30,000 for the Global Fixed Income,
International Bond, Short Duration Tax Exempt and Tax Exempt Bond Funds
and $20,000 for the U.S. Treasury, Limited Maturity, Short Bond,
Intermediate Bond and Opportunity Funds.
Effective November 11, 1995 (December 1, 1995 [commencement of operations]
for the Market Return Fund), Investors Fiduciary Trust Company ("IFTC")
serves as transfer agent to the Funds. Under the terms of the transfer
agency agreement, IFTC is entitled to receive fees based upon a specified
amount per shareholder with specified minimum-per-Fund amounts and
surcharges, plus certain out-of-pocket expenses. Effective January 1, 1996
(December 1, 1995 [commencement of operations] for the Market Return
Fund), IFTC also serves as fund accountant. Under the terms of the fund
accounting agreement, IFTC receives fees based on specified
minimum-per-Group amounts, plus certain out-of-pocket expenses.
Certain officers and/or trustees of the Group are affiliated with Payden &
Rygel, Payden & Rygel Distributors and/or Treasury Plus, Inc. Such
officers and trustees receive no fees from the Funds for serving as
officers and/or trustees of the Group.
62 Payden & Rygel Investment Group
<PAGE>
(This page has been left blank intentionally.)
Semi-Annual Report 63
<PAGE>
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
GLOBAL FIXED INCOME FUND
----------------------------------------------------
----------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR
APRIL 30, ENDED ENDED ENDED
1996 OCTOBER 31, OCTOBER 31, OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- -----------
------------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net asset value -- beginning of
period.............................. $ 10.32 $ 9.77 $ 10.62 $ 9.96
------------- ----------- ----------- -----------
Income (loss) from investment
activities:
Net investment income.............. 0.58 0.89 0.44 0.46
Net realized and unrealized gains
(losses).......................... (0.43) 0.53 (0.65) 0.69
------------- ----------- ----------- -----------
Total from investment
activities.................... 0.15 1.42 (0.21) 1.15
------------- ----------- ----------- -----------
Distributions to shareholders:
From net investment income......... (0.42) (0.87) (0.42) (0.46)
In excess of net investment
income............................
From net realized gains............ (0.22) (0.03)
In excess of net realized gains....
------------- ----------- ----------- -----------
Total distributions to
shareholders.................. (0.42) (0.87) (0.64) (0.49)
------------- ----------- ----------- -----------
Net asset value -- end of period..... $ 10.05 $ 10.32 $ 9.77 $ 10.62
------------- ----------- ----------- -----------
------------- ----------- ----------- -----------
Total return......................... 1.44%* 15.10% (2.09)% 11.88%
------------- ----------- ----------- -----------
Ratios/supplemental data:
Net assets, end of period (000).... $665,195 $540,041 $430,210 $296,958
Ratio of expenses to average net
assets............................ 0.51%** 0.50% 0.55% 0.70%
Ratio of net investment income to
average net assets................ 5.69%** 8.94% 4.24% 4.22%
Ratio of expenses to average net
assets prior to waivers and
reimbursements.................... 0.51%** 0.50% 0.55% 0.68%
Ratio of net investment income to
average net assets prior to
waivers and reimbursements........ 5.69%** 8.94% 4.24% 4.24%
Portfolio turnover rate............ 107.24% 226.72% 348.12% 252.97%
</TABLE>
* Not annualized
** Annualized
SEE NOTES TO FINANCIAL STATEMENTS.
64 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION> GLOBAL FIXED
INCOME FUND INTERNATIONAL BOND FUND SHORT DURATION TAX EXEMPT FUND
------------ ---------------------------- -----------------------------------------
------------ ---------------------------- -----------------------------------------
SIX MONTHS SIX MONTHS
ENDED ENDED YEAR
PERIOD ENDED APRIL 30, PERIOD ENDED APRIL 30, ENDED PERIOD ENDED
OCTOBER 31, 1996 OCTOBER 31, 1996 OCTOBER 31, OCTOBER 31,
1992(A) (UNAUDITED) 1995(B) (UNAUDITED) 1995 1994(C)
------------- ------------- ------------- ------------- ----------- -------------
------------- ------------- ------------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value -- beginning of
period.............................. $ 10.00 $ 10.04 $ 10.00 $ 10.08 $ 9.93 $ 10.00
------------- ------------- ------------- ------------- ----------- -------------
Income (loss) from investment activities:
Net investment income............. 0.05 0.20 0.15 0.20 0.42 0.04
Net realized and unrealized gains
(losses).......................... (0.02) (0.29) 0.09 (0.08) 0.15 (0.07)
------------- ------------- ------------- ------------- ----------- -------------
Total from investment activities: 0.03 (0.09) 0.24 0.12 0.57 (0.03)
------------- ------------- ------------- ------------- ----------- -------------
Distribution to shareholders:
From net investment income......... (0.05) (0.06) (0.15) (0.20) (0.42) (0.04)
In excess of net investment income. (0.02)
From net realized gains............ (0.04) (0.04) (0.01)
In excess of net realized gains.... (0.01)
------------- ------------- ------------- ------------- ----------- -------------
Total distributions to shareholders (0.07) (0.10) (0.20) (0.21) (0.42) (0.04)
------------- ------------- ------------- ------------- ----------- -------------
Net asset value - end of period...... $ 9.96 $ 9.85 $ 10.04 $ 9.99 $ 10.08 $ 9.93
------------- ------------- ------------- ------------- ----------- -------------
------------- ------------- ------------- ------------- ----------- -------------
Total return......................... 0.31%* (0.95)%* 2.43%* 1.19%* 5.88% (0.35)%*
------------- ------------- ------------- ------------- ----------- -------------
Ratios/supplemental data:
Net assets, end of period (000).... $ 20,097 $ 19,585 $ 19,194 $ 25,043 $16,019 $ 20,150
Ratio of expenses to average net
assets........................... 0.70%** 0.70%** 0.70%** 0.45%** 0.45% 0.45%**
Ratio of net investment income to
average net assets............... 4.62%** 5.58%** 5.24%** 3.98%** 4.12% 3.20%**
Ratio of expenses to average net
assets prior to waivers and
reimbursements................... 2.29%** 1.03%** 1.64%** 0.78%** 0.91% 2.87%**
Ratio of net investment income to
average net assets prior to waivers
and reimbursements............... 3.03%** 5.25%** 4.30%** 3.65%** 3.66% 0.78%**
Portfolio turnover rate............ 53.98% 223.46% 96.62% 46.84% 79.81% 0.00%
</TABLE>
- ---------
(a) The Fund commenced operations on September 1, 1992.
(b) The Fund commenced operations on April 1, 1995.
(c) The Fund commenced operations on September 1, 1994.
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 65
<PAGE>
- --------------------------------------------------------
FINANCIAL HIGHLIGHTS (Continued)
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
TAX EXEMPT BOND FUND
-----------------------------------------
-----------------------------------------
SIX MONTHS
ENDED YEAR PERIOD
APRIL 30, ENDED ENDED
1996 OCTOBER 31, OCTOBER 31,
(UNAUDITED) 1995 1994(D)
------------- ----------- -------------
------------- ----------- -------------
<S> <C> <C> <C>
Net asset value -- beginning of period............... $ 9.59 $ 8.90 $ 10.00
------------- ----------- -------------
Income (loss) from investment activities:
Net investment income.............................. 0.22 0.46 0.33
Net realized and unrealized gains (losses)......... (0.17) 0.69 (1.10)
------------- ----------- -------------
Total from investment activities............... 0.05 1.15 (0.77)
------------- ----------- -------------
Distributions to shareholders:
From net investment income......................... (0.22) (0.46) (0.33)
In excess of net investment income.................
From net realized gains............................
In excess of net realized gains....................
------------- ----------- -------------
Total distributions to shareholders............ (0.22) (0.46) (0.33)
------------- ----------- -------------
Net asset value -- end of period..................... $ 9.42 $ 9.59 $ 8.90
------------- ----------- -------------
------------- ----------- -------------
Total return......................................... 0.49%* 13.25% (7.85)%*
------------- ----------- -------------
Ratios/supplemental data:
Net assets, end of period (000).................... $ 54,008 $ 40,052 $ 25,474
Ratio of expenses to average net assets............ 0.45%** 0.45% 0.50%**
Ratio of net investment income to average net
assets............................................ 4.70%** 4.97% 4.47%**
Ratio of expenses to average net assets prior to
waivers and reimbursements........................ 0.62%** 0.74% 1.07%**
Ratio of net investment income to average net
assets prior to waivers and reimbursements........ 4.53%** 4.69% 3.90%**
Portfolio turnover rate............................ 11.43% 41.87% 97.53%
</TABLE>
- ---------
(d) The Fund commenced operations on December 21, 1993.
* Not annualized
** Annualized
SEE NOTES TO FINANCIAL STATEMENTS.
66 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
U.S. TREASURY FUND LIMITED MATURITY FUND
---------------------------- -----------------------------------------
---------------------------- -----------------------------------------
SIX MONTHS SIX MONTHS
ENDED ENDED YEAR
APRIL 30, PERIOD ENDED APRIL 30, ENDED PERIOD ENDED
1996 OCTOBER 31, 1996 OCTOBER 31, OCTOBER 31,
(UNAUDITED) 1995(E) (UNAUDITED) 1995 1994(F)
------------- ------------- ------------- ----------- -------------
------------- ------------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Net asset value -- beginning of period............... $ 10.61 $ 10.00 $ 10.06 $ 10.00 $ 10.00
------------- ------------- ------------- ----------- -------------
Income (loss) from investment activities
Net investment income............................. 0.29 0.53 0.27 0.56 0.19
Net realized and unrealized gains (losses)........ (0.26) 0.61 (0.03) 0.07 (0.01)
------------- ------------- ------------- ----------- -------------
Total from investment activities............... 0.03 1.14 0.24 0.63 0.18
------------- ------------- ------------- ----------- -------------
Distibutions to shareholders:
From net investment income........................ (0.29) (0.53) (0.27) (0.57) (0.18)
In excess of net investment income................
From net realized gains........................... (0.03)
In excess of net realized gains...................
------------- ------------- ------------- ----------- -------------
Total distributions to shareholders............ (0.32) (0.53) (0.27) (0.57) (0.18)
------------- ------------- ------------- ----------- -------------
Net asset value - end of period...................... $ 10.32 $ 10.61 $ 10.03 $ 10.06 $ 10.00
------------- ------------- ------------- ----------- -------------
------------- ------------- ------------- ----------- -------------
Total return......................................... 0.22%* 11.61%* 2.40%* 6.43% 1.84%*
------------- ------------- ------------- ----------- -------------
Ratios/supplemental data:
Net assets, end of period (000).................... $ 17,096 $ 10,894 $ 38,792 $18,414 $ 14,248
Ratio of expenses to average net assets............ 0.45%** 0.45%** 0.30%** 0.30% 0.41%**
Ratio of net investment income to average net assets 5.56%** 6.31%** 5.49%** 5.59% 4.74%**
Ratio of expenses to average net assets prior to
waivers and reimburesments....................... 0.89%** 1.84%** 0.73%** 0.83% 2.92%**
Ratio of net investment income to average net assets
prior to waivers and reimbursements.............. 5.12%** 4.92%** 5.06%** 5.09% 2.23%**
Portfolio turnover rate............................ 36.61% 87.10% 229.33% 166.07% 86.35%
</TABLE>
- ----------
(e) The Fund commenced operations on January 1, 1995.
(f) The Fund commenced operations on May 1, 1994.
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 67
<PAGE>
- --------------------------------------------------------
FINANCIAL HIGHLIGHTS (Continued)
<TABLE>
<CAPTION>
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
SHORT BOND FUND
-----------------------------------------
-----------------------------------------
SIX MONTHS
ENDED YEAR PERIOD
APRIL 30, ENDED ENDED
1996 OCTOBER 31, OCTOBER 31,
(UNAUDITED) 1995 1994(G)
------------- ----------- -------------
------------- ----------- -------------
<S> <C> <C> <C
Net asset value -- beginning of period........... $ 10.04 $ 9.68 $10.00
------------- ----------- -------------
Income (loss) from investment activities:
Net investment income.......................... 0.26 0.54 0.34
Net realized and unrealized gains (losses)..... (0.12) 0.36 (0.32)
------------- ----------- -------------
Total from investment activities........... 0.14 0.90 0.02
------------- ----------- -------------
Distributions to shareholders:
From net investment income..................... (0.26) (0.54) (0.34)
In excess of net investment income.............
From net realized gains........................ (0.01)
In excess of net realized gains................
------------- ----------- -------------
Total distributions to shareholders........ (0.27) (0.54) (0.34)
------------- ----------- -------------
Net asset value -- end of period................. $ 9.91 $ 10.04 $ 9.68
------------- ----------- -------------
------------- ----------- -------------
Total return..................................... 1.39%* 9.56% 0.21%*
------------- ----------- -------------
Ratios/supplemental data:
Net assets, end of period (000)................ $ 36,622 $19,157 $2,592
Ratio of expenses to average net assets........ 0.40%** 0.40% 0.48%**
Ratio of net investment income to average net
assets........................................ 5.55%** 5.72% 4.47%**
Ratio of expenses to average net assets prior
to waivers and reimbursements................. 0.69%** 1.03% 4.56%**
Ratio of net investment income to average net
assets prior to waivers and reimbursements.... 5.26%** 5.09% 0.39%**
Portfolio turnover rate........................ 99.55% 170.27% 186.85%
</TABLE>
- ---------
(g) The Fund commenced operations on January 1, 1994.
* Not annualized
** Annualized
SEE NOTES TO FINANCIAL STATEMENTS.
68 Payden & Rygel Investment Group
<PAGE>
<TABLE>
<CAPTION>
INTERMEDIATE BOND FUND
-----------------------------------------
-----------------------------------------
SIX MONTHS
ENDED
APRIL 30, YEAR ENDED PERIOD ENDED
1996 OCTOBER 31, OCTOBER 31,
(UNAUDITED) 1995 1994(G)
------------- ----------- -------------
------------- ----------- -------------
<S> <C> <C> <C>
Net asset value -- beginning of period........... $ 9.85 $ 9.30 $ 10.00
------------- ----------- -------------
Income (loss) from investment activities:
Net investment income......................... 0.28 0.57 0.35
Net realized and unrealized gains (losses).... (0.23) 0.55 (0.70)
------------- ----------- -------------
Total from investment activities........... 0.05 1.12 (0.35)
------------- ----------- -------------
Distribution to shareholders:
From net investment income.................... (0.28) (0.57) (0.35)
In excess of net investment income............
From net realized gains....................... (0.08)
In excess of net realized gains...............
------------- ----------- -------------
Total distribution to shareholders......... (0.36) (0.57) (0.35)
------------- ----------- -------------
Net asset value - end of period.................. $ 9.54 $ 9.85 $ 9.30
------------- ----------- -------------
------------- ----------- -------------
Total return..................................... 0.45%* 12.43% (3.52)%*
------------- ----------- -------------
Ratios/suppplemental data:
Net assets, end of period (000)............... $32,353 $34,391 $14,312
Ratio of expenses to average net assets....... 0.45%** 0.45% 0.46%**
Ratio of net investment income to average net
assets...................................... 5.88%** 6.10% 5.39%**
Ratio of expenses to average net assets prior
to waivers and reimbursements............... 0.62%** 0.68% 2.03%**
Ratio of net investment income to average net
assets prior to waivers and reimbursements.. 5.71%** 5.87% 3.82%**
Portfolio turnover rate....................... 118.52% 189.00% 358.23%
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION> MARKET RETURN
OPPORTUNITY FUND FUND
----------------------------------------- --------------
----------------------------------------- --------------
SIX MONTHS
ENDED PERIOD ENDED
APRIL 30, YEAR ENDED PERIOD ENDED APRIL 30,
1996 OCTOBER 31, OCTOBER 31, 1996(H)
(UNAUDITED) 1995 1994(G) (UNAUDITED)
------------- ----------- ------------- -------------
------------- ----------- ------------- -------------
<S> <C> <C> <C> <C>
Net asset value -- beginning of period........... $ 9.96 $ 9.09 $10.00 $10.00
------------- ----------- ------------- -------------
Income (loss) from investment activities:
Net investment income......................... 0.28 0.57 0.37 0.21
Net realized and unrealized gains (losses).... (0.38) 0.87 (0.91) 0.15
------------- ----------- ------------- -------------
Total from investment activities........... (0.10) 1.44 (0.54) 0.36
------------- ----------- ------------- -------------
Distribution to shareholders:
From net investment income.................... (0.28) (0.57) (0.37) (0.20)
In excess of net investment income............
From net realized gains.......................
In excess of net realized gains...............
------------- ----------- ------------- -------------
Total distribution to shareholders......... (0.28) (0.57) (0.37) (0.20)
------------- ----------- ------------- -------------
Net asset value - end of period.................. $ 9.58 $ 9.96 $ 9.09 $10.16
------------- ----------- ------------- -------------
------------- ----------- ------------- -------------
Total return..................................... (1.00)%* 16.39% (5.49)%* 3.55%*
------------- ----------- ------------- -------------
Ratios/suppplemental data:
Net assets, end of period (000)............... $31,007 $25,822 $3,030 $3,119
Ratio of expenses to average net assets....... 0.45%** 0.45% 0.49%** 0.05%**
Ratio of net investment income to average net
assets...................................... 5.86%** 6.20% 5.25%** 5.54%**
Ratio of expenses to average net assets prior
to waivers and reimbursements............... 0.67%** 1.11% 4.52%** 6.12%**
Ratio of net investment income to average net
assets prior to waivers and reimbursements.. 5.64%** 5.55% 1.22%** (0.53)%**
Portfolio turnover rate....................... 109.02% 252.09% 513.35% 255.06%
</TABLE>
- ----------
(h) The Fund commenced operations on December 1, 1995.
SEE NOTES TO FINANCIAL STATEMENTS.
Semi-Annual Report 69
<PAGE>
(This page has been left blank intentionally.)
