<PAGE> 1
[PHOTO]
SECURITY
FUNDS
SEMIANNUAL
REPORT
MARCH 31,1995
- - - Security
Growth and
Income Fund
- - - Security Equity
Fund
- Equity Series
- Global Series
- - - Security Ultra
Fund
[LOGO] SECURITY DISTRIBUTORS, INC.
A Member of The Security Benefit
Group of Companies
<PAGE> 2
PRESIDENT'S COMMENTARY
MAY 15, 1995
SECURITY
FUNDS
After a challenging 1994, both U.S. stock and bond investors were pleasantly
surprised by strong market performance in the first quarter of 1995. In fact,
the U.S. equity market had its best quarter in four years. Despite the
disappointing 1994 returns, investors plowed a near-record $124 billion into
stock mutual funds during the year. Both stock and bond markets showed great
resiliency during the first quarter, even though the period was marked by
short-term interest rate increases, England's Barings banking disaster, the
Mexican financial crisis, and a weakening U.S. dollar.
A robust fourth quarter of 1994 set the stage for the first quarter 1995 market
rally. Unexpectedly strong year-end corporate earnings continued into the new
year. The economy finished 1994 with its strongest growth in a decade and its
lowest inflation rate in 12 years. Strong fourth-quarter gross domestic
product, the value of all goods and services produced in the United States,
pushed total growth for the year to 4%. At the same time, the government's
fixed-weighted price index which measures prices paid on specific goods, rose
2.6% for the year - the smallest rise since the government began reporting the
figure in 1983.
The rally was further boosted by a flurry of late first quarter buying as money
managers put excess cash to work to take advantage of the upward momentum of
the equity market. This momentum was most visible in the positive gains posted
by nearly all of the 90 industry groups in the Standard & Poor's 500 Stock
Index.
All three of the major indices, the Dow Jones Industrial Average, the Standard
& Poor's 500 and the NASDAQ, set record highs during the period. Although just
numbers to some, the record highs posted by the major indices may have
represented an important psychological barrier for investors. After a lot of
"wait-and-see", investors exhibited renewed confidence that the economy was
headed for a soft landing and inflation was not a major threat.
The biggest winners included blue-chip growth stocks, U.S. multinationals and
technology issues, as evidenced by the Dow closing above 4000 for the first
time in February. In general, large cap U.S. mutual funds were buoyed by
declining long-term interest rates, strong corporate earnings, and a weakening
dollar which boosted the overseas profits of many multinational companies.
Additionally, domestic equities benefited from the double whammy of a flight to
safety and a flight to quality from cash flowing back into the U.S. as
investors stampeded out of shaky emerging markets.
[PHOTO]
JOHN D. CLELAND
Unfortunately, small capitalization funds didn't fare as well as their larger
cousins. The lion's share of the money flowing back into the U.S. went to
large capitalization growth funds. Spooked by the turmoil of investing
overseas, investors preferred to settle into the relative safety of blue chip
names rather than aggressive small stocks. This was further evidenced as the
NASDAQ did well, but not as well as the Dow or the Standard & Poor's 500.
Since February 1995, there's been a lot of concern about the weakness of the
U.S. dollar. The dollar is principally weak only against the most recognizable
international currencies, namely the Japanese yen and German mark, however it
has fared better against the currencies of our other major trading partners.
1
<PAGE> 3
PRESIDENT'S COMMENTARY (CONTINUED)
MAY 15, 1995
SECURITY
FUNDS
The U.S. dollar does not look nearly as weak when viewed on a trade-weighted
basis. Furthermore, the upside of a weak U.S. dollar is U.S. goods are less
expensive around the world. The global pricing edge these U.S. companies enjoy
in turn boosts corporate earnings.
After yields on long-term bonds peaked in November 1994, the bond market
enjoyed a mixed recovery fueled mainly by an improved inflation outlook and
falling long-term interest rates. However, the bond market may quiet for a
while waiting for stronger data on the true strength of the economy and a
clearer picture of a potential acceleration in inflation
For the period, global markets were weak on a local currency basis, however,
returns improved when translated to U.S. dollars. The U.S. dollar has been in a
free fall for quite some time due to the large U.S. trade deficit, a slowing
economy and the market's belief that the U.S. has no dollar policy. If the
dollar continues to fall, the negative effect on the rest of the world could
begin to hurt U.S. stocks and bonds.
The Japanese economy and stock market had a very rough first quarter of 1995.
Rocked by the devastating Kobe earthquake, a nerve gas attack in a Tokyo subway
and a surge in the value of the yen, the tentative economic recovery was
threatened. Additionally, Japanese exports suffered from shrinking market share
and profitability, which caused equities to tumble during the six-month period.
For investors in Japanese stocks, the market decline was softened by the strong
gains in the yen.
Looking forward, we anticipate core European stocks will perform relatively
well due to rapid acceleration of many European currencies against the U.S.
dollar. Countries with strong currencies such as Germany and Japan could suffer
from a weakened competitive position as domestically produced goods will be
harder to export and will face greater competition from cheaper imports at
home. On the other hand, countries with strong currencies might benefit as
imported goods will cost less and interest rate pressures will be relieved as
their economies growth slows.
We would remind shareholders that in the short run, there will always be market
fluctuations with up and down years. However, when you're looking long term, we
believe it's always a good time to invest in equities. Over the next several
pages, our portfolio managers review the factors influencing the performance of
their respective Funds for the six-month period ending March 31,1995. As always,
our goal is to provide you with positive investment results over time along
with the highest-quality service in the industry. We invite your questions and
comments. Please call our customer service center at 1-800-888-2461, ext.
3112.
Sincerely,
John D. Cleland
John D. Cleland
President - Security Funds
SECURITY BENEFIT LEADS IN QUALITY OF CUSTOMER SERVICE
We're happy to report that during 1994, Security Benefit participated in an
independent customer survey conducted by DALBAR Surveys, Inc. Security
Benefit ranked first or second among peer companies in the timeliness and the
positive attitude we display in providing service to our customers.
2
<PAGE> 4
MANAGER'S COMMENTARY
MAY 15, 1995
Security
Growth and
Income Fund
For the first calendar quarter of 1995, the Security Growth and Income Fund
gained +5.86% compared to the +9.70% return posted by the Standard & Poor's 500
Stock Index. For the six-month period ending March 31,1995, the total return of
the Fund was +3.66%.*
The Fund experienced a difficult fourth quarter of calendar year 1994, losing
2%, primarily due to the general decline in 1994 in both the stock and bond
markets. Additionally, the Fund's underexposure to regional banks and electric
utilities, industries that outperformed the market at the end of 1994 and in
early 1995, negatively impacted performance.
The Fund's overexposure to telecommunications until late in the first quarter
of 1995 also negatively impacted performance. We have subsequently reduced our
exposure to stocks such as AT&T and MCI, primarily because the long distance
pricing wars are still raging and these companies' profits continue to be
adversely affected. It's too early to tell who will be the winner in the battle
for dominance on the information superhighway.
Another factor that negatively affected the performance of the Fund over the
six-month period was its underexposure to paper and forest products, stocks
that tend to do well in the latter stages of economic cycles. As a group, this
sector was up +4.3% in the month of February alone. Other groups where the
portfolio was underweighted
included railroads - up
+4.6% in February - and [PHOTO]
technology, specifically SCOTT STEPHENSON
semiconductor PORTFOLIO MANAGER
manufacturers such as Intel -
up +4% in February.
On the other hand, as interest rates continued to climb during the fourth
quarter, performance was positively impacted due to reduced exposure to
economically-sensitive issues such as autos and housing. This was coupled with
our move to increase weightings in traditional growth names as we continued to
see clear signs of economic slowdown. Growth stocks such as consumer products
giant Colgate Palmolive Company and pharmaceutical supplier Merck & Company,
Inc., are less dependent on economic growth and generally continue to show
positive earnings growth through periods of economic slowdown.
Many of these growth names, including Motorola, Inc. and Walt Disney Company,
were already in the portfolio and we simply increased our exposure to these
companies as the economy began to slow down. Contributing to the portfolio's
performance was our fairly strong weighting in chemicals and specialty
chemicals as demand for consumer nondurable products like bottles and packaging
remained strong. These stocks included W.R.
3
<PAGE> 5
MANAGER'S COMMENTARY (CONTINUED)
MAY 15, 1995
Security
Growth and
Income Fund
Grace and Hercules, Inc. Entertainment companies such as Time-Warner, Inc. and
Carnival Cruise Lines, Inc., which we own, also showed positive earnings
growth.
The portfolio further benefited from its exposure to multinational companies,
large U.S. companies such as PepsiCo, Inc., and McDonald's Corporation, that do
significant business overseas. As foreign economies strengthened, demand for
these companies' products remained strong, positively impacting corporate
earnings. Another positive move was our liquidation of the Telefonos de Mexico
ADR, our only Mexican ADR, before the devaluation of the peso.
The portfolio's fixed-income component increased from 11% to 17% by the
beginning of 1995, with 80% of assets in equities and 3% in cash reserves. The
number of equity names in the portfolio increased from 45 to nearly 70. This
adjustment was primarily a defensive measure to reduce volatility.
Going forward in 1995, we intend to balance cyclicals and growth names. Many
cyclical issues have been pummeled and would enjoy an upward correction if we
do indeed have a soft economic landing as the Federal Reserve Board intends.
However, we will select cyclical stocks on a company-by-company basis, looking
for companies we believe will continue to exhibit earnings growth.
AVERAGE ANNUAL RETURNS
As of March 31, 1995
<TABLE>
<CAPTION>
1 year 5 years 10 years
------ ------- --------
<S> <C> <C> <C>
A SHARES
Growth and Income -0.04% 6.31% 7.96%
Growth and Income -5.76% 5.06% 7.32%
(including 5.75%
Sales Load)
B SHARES
Growth and Income -6.00% -6.26% N/A
(including maximum (10-19-93)
CDSC)
</TABLE>
The performance data above represents past performance which is not predictive
of future results. The investment return and principal value of an investment
in the fund will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. For Class A shares, the figures
above do not reflect deduction of the maximum sales charge, except where noted.
Such figures would be lower if the maximum sales charge were deducted. For
Class B shares, the total return includes deduction of the maximum contingent
deferred sales charge.
*The return quoted is based on Class A shares.
4
<PAGE> 6
MANAGER'S COMMENTARY
MAY 15, 1995
SECURITY EQUITY
FUND -
EQUITY SERIES
Continuing the rally that began around Thanksgiving 1994, the U.S. stock market
experienced its best quarter in nearly four years in the first quarter of 1995.
Investors' perceptions that the economy is headed for a soft landing took the
pressure off interest rates and boosted stock prices. Besides investors'
renewed confidence, cash flowing back into the U.S. from shaky emerging markets
helped boost large capitalization growth stocks for first time since 1991.
Sectors that led the market in 1994 included traditional growth industries such
as consumer nondurables, healthcare, telecommunications and late in 1994 the
technology sector, due to consumers' demand for personal computers. Out of favor
since their superior performance in 1991, relatively stable growth stocks
became the place to be in the fourth quarter of 1994 and first quarter of 1995.
Reacting early to initial signs of economic slowdown in 1994, we positioned the
portfolio to capitalize on the resurgence of traditional growth names, which
tend to perform well during periods of slowing economic growth. As of March 31,
1995, the portfolio had a 65% weighting in growth names, with 10% in
economically-sensitive issues, 15% in value stocks and 10% in
interest-sensitive names. This exposure to growth stocks helped Security Equity
Fund post a first quarter 1995 return of
+9.72%, on par with the +9.70%
returned by the Standard & Poor's [PHOTO]
500 Stock Index. The Fund's total
return for the six-month period TERRY A. MILBERGER
ending March 31, 1995, was 7.88%.* PORTFOLIO MANAGER
Specifically influencing the Fund's performance for the period was the
portfolio's exposure to defensive industries like healthcare, financial
services, insurance, technology, entertainment, restaurants and consumer
products companies. The big appeal of defensive stock groups such as soft
drinks, foods and drugs is steadiness of earnings regardless of the rate of
economic growth. Over the period, the portfolio's healthcare weighting
increased to 10%, and exposure to entertainment company stocks climbed to
nearly 8%. Stocks such as American Home Products Corporation, Merck & Company,
Inc. and Walt Disney Company performed to our expectations. Expecting the
economic slowdown to continue and possibly accelerate, we anticipate the
portfolio will continue to emphasize steady performers such as
Colgate-Palmolive Company, McDonald's Corporation and Microsoft Corporation.
Technology, especially semiconductors, was also a strong performer during the
period, with companies such as Varian Associates, Inc., a
5
<PAGE> 7
MANAGER'S COMMENTARY (CONTINUED)
MAY 15, 1995
SECURITY EQUITY
FUND -
EQUITY SERIES
manufacturer of electronic components and semiconductors, performing well. We
were also pleased with the performance of our holdings of interest-sensitive
financial services and insurance issues, namely Chubb Corporation, American
General Corporation and Jefferson Pilot Corporation. In fact, the insurance
sector was one of the first interest-sensitive sectors to stabilize and
rebound.
The portfolio's exposure to international markets through its multinational
holdings, U.S. companies with significant overseas presence, contributed
significantly to the Fund's positive total return. Worldwide franchise
companies such as McDonald's Corporation and Procter & Gamble Company are
experiencing dramatic international growth as they benefit from economic
recoveries overseas. Demand for these companies' products remains high, with
PepsiCo, Inc., deriving a significant portion of total sales outside the U.S.
Our philosophy is to remain fully invested at all times, regardless of
prevailing economic activity. Diversification and increased exposure to
defensive or offensive names will be used to attempt to counter market shifts.
Although the economy does not often experience a soft landing, it appears we
may be on track for the painless slowdown the Federal Reserve Board attempted
to engineer through its multiple short-term interest rate increases in 1994 and
early 1995. We do not anticipate the Federal Reserve Board will find it
necessary to raise interest rates at this time.
AVERAGE ANNUAL RETURNS
As of March 31, 1995
<TABLE>
<CAPTION>
1 year 5 years 10 years
------ ------- --------
<S> <C> <C> <C>
A SHARES
Equity 10.88% 12.46% 14.40%
Equity 4.48% 11.12% 13.73%
(including 5.75%
Sales Charge)
B SHARES
Equity 4.58% -3.37% N/A
(including maximum CDSC) (10-19-93)
</TABLE>
The performance data above represents past performance which is not predictive
of future results. The investment return and principal value of an investment
in the fund will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. For Class A shares, the figures
above do not reflect deduction of the maximum sales charge, except where noted.
Such figures would be lower if the maximum sales charge were deducted. For
Class B shares, the total return includes deduction of the maximum contingent
deferred sales charge.
* The return quoted is based on Class A shares.
6
<PAGE> 8
MANAGER'S COMMENTARY
MAY 15,1995
SECURITY
EQUITY FUND
GLOBAL SERIES
For the first quarter of 1995, the Series declined -1.27%.* For the six-month
period ending March 31, 1995, the Global Series posted a -4.72%* loss, compared
to a +3.02% return for the Morgan Stanley Capital International World Index
(MSCI).
The positive return of the MSCI was due in large part to a strong U.S. market
and a weak U.S. dollar. Many U.S. companies benefited from the falling dollar
versus the Japanese yen and several European currencies, as the lower dollar
makes U.S. products more competitive on a global basis. Similarly, U.S.
companies with operations in countries with strong currencies benefited from
currency translation gains.
The Japanese stock market and economy experienced a very difficult first
quarter due to the Kobe earthquake and the surge in the value of the yen.
Japanese equities tumbled during the quarter, but due to strong gains in the
yen, the market was down only 2.2% in terms of U.S. dollars. A major factor
negatively influencing the performance of the portfolio was its overweighting
in Japanese cyclical stocks, which were down between 30% and 40%, until midway
through the first quarter.
Although we began liquidating cyclicals and adding financial stocks and other
defensive issues during the first quarter of 1995, our overweighting hurt
performance for the period. The Japanese market is heavily dominated by
financial stocks - at nearly 25% of stocks traded. During a down market in
Japan, financial stocks behave much like classic growth stocks do in the U.S by
showing steady earnings growth. Conversely, the Japanese bond market rallied
as
[PHOTO] [PHOTO]
RICHARD SALER ALAN WAPNICK
PORTFOLIO MANAGER PORTFOLIO MANAGER
investors anticipated a weak economy and continued deflationary pressures.
Although the Japanese economy is in recovery, the strong yen threatens economic
pick up and Japanese exports are suffering from falling profitability and
market share loss.
Another factor affecting performance was the significant trading costs incurred
when we liquidated Japanese cyclicals. However, we have begun adding some of
these issues back into the portfolio as we believe cyclical stocks have
declined in price to the point where they now represent good value. However,
selection will proceed cautiously on a stock-by-stock basis.
Additionally, for the period, the portfolio was underweighted in U.S stocks.
Although we correctly identified the major investment theme - a slowing economy
with resurgence in classic growth stocks - we did not have an adequate
allocation to such stocks in the portfolio. We began the first quarter 1995
with a 23% U.S. weighting. For the same period, the MSCI
7
<PAGE> 9
MANAGER'S COMMENTARY (CONTINUED)
MAY 15, 1995
SECURITY
EQUITY FUND -
GLOBAL SERIES
had a 37% weighting. Over the course of the quarter we were able to increase
the weighting of U.S. stocks to 30%, however, it was still below the index and
continued to hamper the Fund's performance.
Positively impacting the portfolio's performance was our overweighted position
in Europe. In dollar terms, European stocks performed well due to the rapid
appreciation of many European currencies against the dollar. We concentrated in
core European markets, specifically Germany and Switzerland, with strong
currencies and subdued inflation. However, we maintained low exposure in
European countries with high budget deficits and weak currencies such as Spain,
Italy and Sweden. Additionally, our exposure was light in emerging markets
around the world. We anticipate remaining underweighted in these markets and
will add to the portfolio on a stock by stock basis as opposed to employing a
country theme or a general emerging market theme.
As of March 31, 1995, the Series held 10% in cash. We will look for good
investment opportunities in the Japanese market if it continues to weaken. We
expect to maintain our overweighted exposure to core European markets where we
anticipate a strong rally if the U.S. dollar strengthens. If the U.S. economy
continues to grow at a sustainable non-inflationary rate throughout the
remainder of 1995, we expect attractive opportunities resulting from economic
reacceleration as long rates have declined and unemployment remains low.
In the short term the dollar is a key variable. The U.S. dollar has fallen to a
level that could dampen or slow economic growth in foreign countries. However,
we believe a stronger dollar would be a positive for foreign markets. We would
anticipate potentially hedging the dollar as a rising dollar could offset gains
made in local markets in local currency terms.
AVERAGE ANNUAL RETURNS
As of March 31, 1995
<TABLE>
<CAPTION>
1 year 5 years
------ -------
<S> <C> <C>
A SHARES
Global Series -0.30% 2.18%
Global Series (including 5.75% -6.02% -1.78%
Sales Charge) (10-1-93)
B SHARES
Global Series (including -6.21% -1.18%
maximum CDSC) (10-19-93)
</TABLE>
The performance data above represents past performance which is not predictive
of future results. The investment return and principal value of an investment
in the fund will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. For Class A shares, the figures
above do not reflect deduction of the maximum sales charge, except where noted.
Such shares would be lower if the maximum sales charge were deducted. For Class
B shares, the total return includes deduction of the maximum contingent
deferred sales charge.
IMPORTANT INFORMATION ABOUT GLOBAL INVESTING
All investments are subject to certain risks. Investments outside the U.S.
(especially those in developing countries) are subject to additional risks,
including currency fluctuations, political and social instability, differing
securities regulations and accounting standards, limited public information,
possible changes in taxation and periods of illiquidity.
* The return quoted is based on Class A shares.
8
<PAGE> 10
MANAGER'S COMMENTARY
MAY 15, 1995
SECURITY
ULTRA FUND
As a result of significant restructuring in the fourth quarter of 1994, the
focus of the Security Ultra Fund portfolio shifted from micro-cap stocks,
companies with less than $100 million in market capitalization, to stocks of
companies in the range of $200 million to $2 billion in market capitalization.
Although the rewards of investing in very small issues can be dramatic, larger
cap names tend to have greater liquidity and normally experience less extreme
price fluctuations. Low liquidity is not in itself negative, but it makes
protection from loss during market corrections more difficult.
During the same period, the investment style of the portfolio shifted from
value stocks to emphasis on growth-oriented issues. Growth names have generally
outperformed value stocks since mid-1994 when the U.S. economy exhibited early
signs of slowdown. As the economy continues to slow and the growth versus value
cycle lengthens in duration, we expect growth stocks to continue to outperform
the value stocks.
Finally, the results of a study we conducted on the portfolio's risk level led
us to realign the portfolio to be more consistent with the sector and industry
weightings of the Standard & Poor's Midcap Growth Index, the Fund's benchmark.
However, this realignment is not an attempt to exactly duplicate the
benchmark's weightings.
Following the portfolio's restructuring, the Fund posted a +3.44% first quarter
gain, compared to +6.45% for the Lipper peer group average and
+8.20% for the Standard &
Poor's Midcap Growth Index. [PHOTO]
For the six-month period CINDY SHIELDS
ending March 31, 1995, the PORTFOLIO MANAGER
Fund returned +3.39%.*
The Fund's underexposure to technology and heavy cash reserves early in the
first quarter of 1995 were the primary factors impacting its performance.
Technology significantly outperformed other sectors in the final quarter of
1994 and first quarter of 1995, and we gradually increased our technology
exposure to 24% of assets over the first quarter. While we are extremely
bullish on technology for the long-term, we will maintain our current exposure
for the short-term. We expect a moderate second and third quarter correction
due to the European summer holiday and the usual mid-year slowdown in corporate
spending. We have also reduced our cash position from a high of 15% to 5.5% as
of March 31, 1995. We will consider the portfolio fully invested when cash is
around 5% to 7%.
The portfolio experienced positive performance from its exposure to healthcare,
approximately 12% of assets. Having performed to our expectations so far this
year, we anticipate healthcare and pharmaceutical stocks will continue strong
performance in the short-term, the long-term outlook is less clear. The threat
of healthcare reform forced many companies to reexamine their pricing
structures. As they continue voluntary reform, we expect profit margins to
shrink and competition and consolidation in the industry to intensify.
9
<PAGE> 11
MANAGER'S COMMENTARY (CONTINUED)
MAY 15, 1995
SECURITY
ULTRA FUND
Small cap stocks generally underperformed large caps throughout 1994 and the
first quarter of 1995. Even the anticipated January effect, where small caps
typically outperform in January, failed to materialize and provide a jump
start. In part, this underperformance was a result of a lack of positive money
flows into aggressive growth funds. Earlier in the current small cap cycle,
much of the aggressive money flowed to international funds as investors
searched for higher returns in riskier foreign markets. However, given the
number of global woes, from Mexico to China, international funds have begun to
experience massive net redemptions. Although U.S. stocks have benefited from
the flight to safety, most of the inflow has gone to large cap growth names
rather than the more volatile small caps.
Additionally, because small cap stock earnings are driven mainly by domestic
growth, they typically have little multinational exposure. Consequently, they
missed the currency benefit multinationals, U.S. companies with substantial
international earnings, enjoyed through conversion of foreign revenues to a
weaker U.S. dollar.
With emerging growth stocks enjoying a bull market since 1991, it remains to be
seen if this is just a short-term correction or if it heralds the end of the
most recent small cap cycle. Regardless, we believe small and mid cap stocks
belong in almost every long-term investor's portfolio.
Positives for small caps include the decline in the number of initial public
offerings from late 1993 and early 1994. This means more dollars chasing fewer
shares, which tends to boost prices. Add to that the recent surge of stock
repurchase programs, often a positive signal that companies believe their
stocks are undervalued. Passage of a capital gains tax cut although
speculative, could also be a positive for the small cap market. A change in the
tax would make capital appreciation more attractive than dividends. Because
small caps tend to obtain most of their total returns from capital
appreciation, their attractiveness to investors would improve.
AVERAGE ANNUAL RETURNS
As of March 31, 1995
<TABLE>
<CAPTION>
1 year 5 years 10 years
------ ------- --------
<S> <C> <C> <C>
A SHARES
Ultra 2.19% 5.89% 6.43%
Ultra (including 5.75% -3.67% 4.63% 5.81%
Sales Charge)
B SHARES
Ultra (including -3.54% -6.07% N/A
maximum CDSC) (10-19-93)
</TABLE>
The performance data above represents past performance which is not predictive
of future results. The investment return and principal value of an investment in
the fund will fluctuate so that an investor's shares when redeemed, may be worth
more or less than their original cost. For Class A shares, the figures above do
not reflect deduction of the maximum sales charge, except where noted. Such
figures would be lower if the maximum sales charge were deducted. For Class B
shares, the total includes deduction of the maximum contingent deferred sales
charges.
* The return quoted is based on Class A shares.
10
<PAGE> 12
STATEMENTS OF NET ASSETS
MARCH 31, 1995
(Unaudited)
SECURITY GROWTH AND INCOME FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OR
NUMBER MARKET
OF SHARES CORPORATE BONDS VALUE
- - --------------------------------------------------------------------------------------
<S> <C> <C>
COMMUNICATIONS - 3.3%
$1,000,000 Paging Network, Inc.,
11.75% - 2002 ..................................... $ 1,046,250
$1,000,000 Rogers Communications, Inc.,
10.875% - 2004 .................................... 1,006,250
-----------
2,052,500
DIVERSIFIED - 1.5%
$1,000,000 Sequa Corporation, 9.375% - 2003..................... 915,000
GROCERY STORES - 1.6%
$1,000,000 Penn Traffic Company,
10.65% - 2004 ..................................... 1,022,500
HOTELS - 1.4%
$900,000 Embassy Suites, 8.75% - 2000......................... 877,500
MEDICAL & HEALTH SERVICES - 1.6%
$1,000,000 Healthsouth Rehabilitation Corporation,
9.50% - 2001....................................... 997,500
PAPER & PACKAGING - 1.6%
$1,000,000 Riverwood International Corporation,
10.375% - 2004..................................... 1,016,250
RADIO & TELEVISION - 4.8%
$1,000,000 Continental Cablevision, Inc.,
8.875% - 2005...................................... 946,250
$2,000,000 Granite Broadcasting Corporation,
12.75% - 2002...................................... 2,062,500
-----------
3,008,750
STEEL & METAL PRODUCTS - 1.6%
$1,000,000 Weirton Steel Corporation,
11.50% - 1998...................................... 1,002,500
-----------
Total corporate bonds -
(Cost $10,782,000) - 17.4%......................... 10,892,500
PREFERRED STOCK
BANKING & CREDIT - 1.6%
10,000 First Nationwide Bank................................ 1,011,250
OIL & GAS COMPANIES - 1.0%
15,000 Valero Energy Corporation............................ 641,250
-----------
Total preferred stocks -
(Cost $1,801,250) - 2.6%........................... 1,652,500
COMMON STOCK
ADVERTISING - 1.3%
15,000 Omnicom Group, Inc. ................................. 821,250
AEROSPACE & DEFENSE - 3.2%
15,000 Allied-Signal, Inc. ................................. $ 588,750
15,000 McDonnell Douglas Corporation........................ 836,250
15,000 Rockwell International Corporation................... 585,000
-----------
2,010,000
AMUSEMENT & RECREATIONAL SERVICES - 2.8%
40,000 Carnival Cruise Lines, Inc. ......................... 935,000
15,000 Disney (Walt) Company ............................... 800,625
-----------
1,735,625
BANKING & FINANCE - 3.3%
15,000 BankAmerica Corporation.............................. 723,750
10,000 MGIC Investment Corporation.......................... 407,500
25,000 Mercantile Bancorporation, Inc. ..................... 912,500
-----------
2,043,750
BROADCASTING - 1.4%
20,000 Viacom, Inc. (CI.B)* ................................ 895,000
BUSINESS SERVICES - 1.6%
10,000 ITT Corporation...................................... 1,026,250
CHEMICALS - 8.3%
25,000 Cabot Corporation.................................... 921,875
10,000 Dow Chemical Company................................. 730,000
20,000 Grace (W.R.) & Company............................... 1,065,000
20,000 Hercules, Inc. ...................................... 932,500
10,000 Monsanto Company..................................... 802,500
30,000 Praxair, Inc. ....................................... 697,500
-----------
5,149,375
COMMUNICATIONS - 3.5%
25,000 ALC Communications Corporation* ..................... 853,125
15,000 DSC Communications Corporation* ..................... 488,438
40,000 Tele-Communications, Inc.* .......................... 840,000
-----------
2,181,563
COMPUTER SERVICES - 2.5%
30,000 Ceridian Corporation* ............................... 1,001,250
15,000 General Motors Corporation (CI.E) ................... 583,125
-----------
1,584,375
COMPUTER SOFTWARE - 0.5%
8,200 Sybase, Inc.* ...................................... 328,000
</TABLE>
See accompanying notes.
11
<PAGE> 13
STATEMENTS OF NET ASSETS
MARCH 31, 1995
(Unaudited)
<TABLE>
<CAPTION>
SECURITY GROWTH AND INCOME FUND
(continued)
NUMBER MARKET
OF SHARES COMMON STOCK (continued) VALUE
- - -------------------------------------------------------------------------------
<S> <C> <C>
COMPUTER SYSTEMS - 3.3%
15,000 Cabletron Systems, Inc.* .................... $ 673,125
15,000 Compaq Computer Corporation* ................ 517,500
25,000 Sun Microsystems, Inc.* ..................... 868,750
----------
2,059,375
CONSUMER GOODS & SERVICES - 1.2%
30,000 Newell Company .............................. 765,000
DRUGS - 4.8%
10,000 American Home Products Corporation .......... 712,500
10,000 Amgen, Inc.* ................................ 673,750
20,000 Merck & Company, Inc. ....................... 852,500
15,000 Scherer (R.P.) Corporation* ................. 753,750
----------
2,992,500
ELECTRICAL COMPANIES & SYSTEMS - 1.4%
25,000 Philips Electronics, N.V. ................... 853,125
ELECTRICAL MACHINERY & ELECTRONIC
COMPONENTS - 4.9%
15,000 General Electric Company .................... 811,875
20,000 Loral Corporation ........................... 850,000
10,000 Motorola, Inc. ............................. 546,250
20,000 Varian Associates, Inc. .................... 842,500
----------
3,050,625
ENGINEERING & ARCHITECTURAL SERVICES - 1.4%
25,000 Foster Wheeler Corporation .................. 846,875
ENVIRONMENTAL SERVICES - 1.4%
25,000 Browning-Ferris Industries, Inc. ........... 850,000
FERTILIZER - 2.6%
15,000 IMC Global, Inc. ........................... 733,125
20,000 Potash Corporation of
Saskatchewan, Inc. ....................... 890,000
----------
1,623,125
FOOD & BEVERAGES - 1.6%
25,000 PepsiCo, Inc. .............................. 975,000
HOTEL MANAGEMENT - 1.7%
30,000 Marriott International, Inc. ................ 1,042,500
INSURANCE - 2.3%
20,000 American General Corporation ................ 645,000
10,000 Chubb Corporation ........................... 790,000
----------
1,435,000
MACHINERY - 1.3%
10,000 Deere & Company ............................. 812,500
MANUFACTURING - 1.4%
25,000 Corning, Inc. .............................. $ 900,000
MEDICAL & HEALTH CARE - 2.1%
20,000 Columbia Healthcare Corporation ............. 860,000
30,000 Tenet Healthcare* ........................... 476,250
----------
1,336,250
MEDICAL INSTRUMENTS & SUPPLIES - 1.0%
20,000 Baxter International, Inc. ................. 655,000
OIL & GAS COMPANIES - 1.5%
20,000 Chevron Corporation ......................... 960,000
PETROLEUM REFINING - 1.6%
15,000 Texaco, Inc. ................................ 997,500
PHOTOGRAPHIC EQUIPMENT & SUPPLIES - 0.9%
5,000 Xerox Corporation ........................... 586,875
PUBLISHING & PRINTING - 2.1%
30,000 News Corporation, Ltd. (The) ................ 573,750
20,000 Time-Warner, Inc. .......................... 755,000
----------
1,328,750
RESTAURANTS & FOOD SERVICE - 2.1%
20,000 McDonald's Corporation ...................... 682,500
40,000 Wendy's International, Inc. ................ 655,000
----------
1,337,500
RETAIL TRADE - 3.8%
30,000 Federated Department Stores, Inc.* ......... 663,750
20,000 Home Depot, Inc. ........................... 885,000
20,000 Leggett & Platt, Inc. ...................... 840,000
----------
2,388,750
SCIENTIFIC INSTRUMENTS - 1.8%
20,000 Millipore Corporation ....................... 1,115,000
SOAP, CLEANERS & TOILET GOODS - 1.6%
15,000 Colgate-Palmolive Company ................... 990,000
TRANSPORTATION - 1.0%
10,000 Burlington Northern, Inc. .................. 593,750
----------
Total common stock -
(Cost $44,835,417) - 77.2% ................ 48,270,188
</TABLE>
See accompanying notes.
12
<PAGE> 14
STATEMENTS OF NET ASSETS
MARCH 31, 1995
(Unaudited)
SECURITY GROWTH AND INCOME FUND
(continued)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OR
NUMBER MARKET
OF SHARES COMMERCIAL PAPER VALUE
- - ------------------------------------------------------------------------------
<S> <C> <C>
CHEMICALS - 1.1%
$650,000 Lubrizol Corporation,
5.96%, 4-19-95 ............................ $ 648,063
-----------
Total commercial paper -
(Cost $648,063) - 1.1% ................... 648,063
-----------
Total investments -
(Cost $58,066,730) - 98.3% ............... 61,463,251
Cash & other assets, less
liabilities - 1.7% ....................... 1,092,207
-----------
Total net assets - 100.0% .................. $62,555,458
===========
<CAPTION>
SECURITY EQUITY FUND - EQUITY SERIES
COMMON STOCK
------------
<S> <C> <C>
ADVERTISING - 1.4%
100,000 Omnicom Group, Inc. ....................... $ 5,475,000
AEROSPACE & DEFENSE - 6.0%
160,000 Allied-Signal, Inc. ....................... 6,280,000
120,000 McDonnell Douglas
Corporation .............................. 6,690,000
70,000 Raytheon Company ........................... 5,101,250
150,000 Rockwell International
Corporation .............................. 5,850,000
-----------
23,921,250
AMUSEMENT & RECREATIONAL
SERVICES - 2.5%
240,000 Carnival Cruise Lines, Inc. ................ 5,610,000
80,000 Disney (Walt) Company ....................... 4,270,000
-----------
9,880,000
BANKING & FINANCE - 2.9%
120,000 BankAmerica Corporation ..................... 5,790,000
50,000 MGIC Investment Corporation ................. 2,037,500
100,000 Mercantile Bancorporation, Inc. ............ 3,650,000
-----------
11,477,500
BROADCASTING - 1.4%
125,000 Viacom, Inc. (CI.B)* ........................ 5,593,750
BUSINESS SERVICES - 1.3%
50,000 ITT Corporation ............................. 5,131,250
<CAPTION>
SECURITY EQUITY FUND - EQUITY SERIES
(continued)
NUMBER MARKET
OF SHARES COMMON STOCK (continued) VALUE
- - -------------------------------------------------------------------------------
<S> <C> <C>
CHEMICALS - 9.5%
200,000 Cabot Corporation ........................... $ 7,375,000
75,000 Dow Chemical Company ........................ 5,475,000
125,000 Grace (W.R.) & Company ...................... 6,656,250
150,000 Hercules, Inc. ............................. 6,993,750
80,000 Monsanto Company ............................ 6,420,000
200,000 Praxair, Inc. .............................. 4,650,000
-----------
37,570,000
COMMUNICATIONS - 3.2%
175,000 ALC Communications Corporation* ............. 5,971,875
50,000 DSC Communications Corporation* ............. 1,628,125
250,000 Tele-Communications, Inc.* .................. 5,250,000
-----------
12,850.000
COMPUTER SERVICES - 4.0%
150,000 Ceridian Corporation* ....................... 5,006,250
100,000 Computer Sciences Corporation* .............. 4,937,500
150,000 General Motors Corporation (CI.E) ........... 5,831,250
-----------
15,775,000
COMPUTER SOFTWARE - 1.6%
65,000 Microsoft Corporation ....................... 4,623,125
43,400 Sybase, Inc.* ............................... 1,736,000
-----------
6,359,125
COMPUTER SYSTEMS - 2.9%
30,000 Cabletron Systems, Inc.* .................... 1,346,250
60,000 Compaq Computer Corporation* ................ 2,070,000
70,000 International Business Machines
Corporation ............................... 5,731,250
70,000 Sun Microsystems, Inc.* ..................... 2,432,500
-----------
11,580,000
CONSUMER GOODS & SERVICES - 1.3%
200,000 Newell Company .............................. 5,100,000
DRUGS - 4.7%
80,000 American Home Products
Corporation ............................... 5,700,000
100,000 Amgen, Inc.* ................................ 6,737,500
100,000 Merck & Company, Inc. ...................... 4,262,500
42,250 Scherer (R.P.) Corporation* ................. 2,123,063
-----------
18,823,063
ELECTRICAL COMPANIES & SYSTEMS - 1.3%
150,000 Philips Electronics, N.V. .................. 5,118,750
</TABLE>
See accompanying notes.
13
<PAGE> 15
STATEMENTS OF NET ASSETS
MARCH 31, 1995
(Unaudited)
SECURITY EQUITY FUND - EQUITY SERIES
(CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES COMMON STOCK (continued) VALUE
- - ------------------------------------------------------------------
<S> <C> <C>
ELECTRICAL MACHINERY & ELECTRONIC
COMPONENTS - 5.6%
120,000 General Electric Company ................$ 6,495,000
135,000 Loral Corporation ....................... 5,737,500
70,000 Motorola, Inc.*.......................... 3,823,750
140,000 Varian Associates, Inc. ................. 5,897,500
----------
21,953,750
ENGINEERING & ARCHITECTURAL SERVICES - 0.6%
70,000 Foster Wheeler Corporation .............. 2,371,250
ENVIRONMENTAL SERVICES - 1.1%
130,000 Browning-Ferris Industries, Inc. ........ 4,420,000
FERTILIZERS - 2.0%
100,000 IMC Global, Inc. ........................ 4,887,500
70,000 Potash Corporation of
Saskatchewan, Inc. .................... 3,115,000
----------
8,002,500
FINANCE - 1.7%
50,000 Federal National Mortgage
Association ........................... 4,068,750
40,000 Morgan Stanley Group, Inc. .............. 2,695,000
----------
6,763,750
FOOD & BEVERAGES - 1.5%
150,000 PepsiCo, Inc. ........................... 5,850,000
HOTEL MANAGEMENT - 1.2%
135,000 Marriott International, Inc. ............ 4,691,250
INSURANCE - 6.3%
180,000 American General Corporation ............ 5,805,000
60,000 American International Group, Inc. ...... 6,255,000
50,000 Chubb Corporation ....................... 3,950,000
85,000 Jefferson Pilot Corporation ............. 5,025,625
60,000 MBIA, Inc. .............................. 3,772,500
----------
24,808,125
MACHINERY - 1.7%
85,000 Deere & Company ......................... 6,906,250
MANUFACTURING - 2.4%
150,000 Corning, Inc. ........................... 5,400,000
200,000 Pall Corporation ........................ 4,200,000
----------
9,600,000
MEDICAL & HEALTH CARE - 2.1%
125,000 Columbia Healthcare Corporation ......... 5,375,000
175,000 Tenet Healthcare* ....................... 2,778,125
----------
8,153,125
MEDICAL INSTRUMENTS & SUPPLIES - 0.8%
100,000 Baxter International, Inc. ..............$ 3,275,000
OIL & GAS COMPANIES - 2.6%
180,000 Apache Corporation ...................... 4,905,000
110,000 Chevron Corporation ..................... 5,280,000
----------
10,185,000
PAINT & ALLIED PRODUCTS - 1.5%
175,000 Sherwin-Williams Company ................ 5,928,125
PETROLEUM REFINING - 2.9%
50,000 Royal Dutch Petroleum Company ........... 6,000,000
80,000 Texaco, Inc. ............................ 5,320,000
----------
11,320,000
PHOTOGRAPHIC EQUIPMENT &
SUPPLIES - 1.5%
50,000 Xerox Corporation ....................... 5,868,750
PUBLISHING & PRINTING - 2.8%
250,000 News Corporation, Ltd. (The) ............ 4,781,250
170,000 Time-Warner, Inc. ....................... 6,417,500
----------
11,198,750
RESTAURANTS & FOOD SERVICE - 2.9%
200,000 McDonald's Corporation .................. 6,825,000
280,000 Wendy's International, Inc. ............. 4,585,000
----------
11,410,000
RETAIL TRADE - 5.5%
250,000 Federated Department Stores, Inc.* ...... 5,531,250
75,000 Home Depot, Inc. ........................ 3,318,750
75,000 Leggett & Platt, Inc. ................... 3,150,000
135,000 Safeway, Inc.* .......................... 4,691,250
110,000 Walgreen Company ........................ 5,293,750
----------
21,985,000
SCIENTIFIC INSTRUMENTS - 1.1%
75,000 Millipore Corporation ................... 4,181,250
SOAPS, CLEANERS & TOILET GOODS - 2.1%
50,000 Colgate-Palmolive Company ............... 3,300,000
75,000 Procter & Gamble Company ................ 4,968,750
----------
8,268,750
</TABLE>
See accompanying notes.
14
<PAGE> 16
STATEMENTS OF NET ASSETS
SECURITY EQUITY FUND - EQUITY SERIES
(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OR
NUMBER OF MARKET
SHARES COMMON STOCK (continued) VALUE
- - ------------------------------------------------------------------------
<S> <C> <C>
TRANSPORTATION - 2.4%
85,000 Burlington Northern, Inc. ................ $ 5,046,875
135,000 Illinois Central Corporation ............. 4,657,500
------------
9,704,375
------------
Total common stock -
(Cost $318,219,114) - 96.3% ............ 381,499,688
COMMERCIAL PAPER
BUSINESS SERVICES - 1.0%
$4,000,000 Penney (J.C.) Funding Corporation,
5.95%, 4-10-95 ....................... 3,994,050
COMPUTERS - 0.4%
$1,500,000 Hewlett-Packard Company,
5.93%, 4-6-95 ........................ 1,498,765
ELECTRONICS - 0.1%
$500,000 TDK (U.S.A.) Corporation,
5.96%, 4-17-95 ........................ 498,675
LEASING COMPANIES - 0.6%
$2,500,000 P.H.H. Corporation,
5.95%, 4-13-95 ...................... 2,495,042
UTILITIES - 0.8%
$1,000,000 Florida Power Corporation,
5.975%, 4-11-95 ....................... 998,340
$1,500,000 Potomac Electric Power Company,
6.27%, 4-4-95 ......................... 1,499,216
$500,000 Tampa Electric Company,
5.975%, 4-7-95 ....................... 499,502
-----------
2,997,058
-----------
Total commercial paper -
(Cost $11,483,590) - 2.9% .............. 11,483,590
-----------
Total investments -
(Cost $329,702,704) - 99.2% ........... 392,983,278
Cash and other assets, less
liabilities - 0.8% .................... 3,264,334
------------
Total net assets - 100.0% ............... $396,247,612
============
SECURITY EQUITY FUND - GLOBAL SERIES
PREFERRED STOCK
---------------
GERMANY - 1.0%
240 Moebel Walther AG ........................ 115,988
190 Sto Ag-Vor ............................... 117,645
------------
233,633
------------
Total preferred stock-
(Cost $277,409) - 1.0% ................. $ 233,633
COMMON STOCK
------------
AUSTRALIA - 2.6%
24,700 Mayne Nickless Ltd. ..................... 108,058
86,500 Tabcorp Holdings, Ltd. .................. 175,832
15,000 Tabcorp Holdings(1) (ADR) ................ 303,750
------------
587,640
AUSTRIA - 0.3%
1,054 Bohler Uddeholm(1) ...................... 59,792
BELGIUM - 0.5%
1,800 Union Miniere ........................... 119,127
CANADA - 1.1%
11,000 Canadian Pacific Ltd. ................... 164,370
53,000 Markborough Properties, Inc. ............ 77,774
------------
242,144
CHILE - 0.4%
7,000 Banco Osorno y La Union ................. 89,250
DENMARK - 1.2%
2,700 Novo-Nordisk A/S "B" .................... 261,559
FINLAND - 1.1%
8,500 Huhtamaki Series 1 ...................... 253,514
FRANCE - 6.1%
3,620 Banque Nationale de Paribas ............. 183,972
1,154 Cetelem ................................. 250,181
700 Comptoirs Modernes S.A. ................. 216,795
500 Elf Aquitaine ........................... 39,098
300 Groupe Danone ........................... 50,946
1,550 Havas ................................... 116,790
3,100 SEB SA .................................. 329,911
1,640 Societe Generale ........................ 190,214
------------
1,377,907
GERMANY - 4.2%
340 Ava Allig Hande .......................... 113,169
740 Continental Tire Company ................ 107,020
480 Deutsche Bank AG ........................ 226,570
620 Douglas Holding AG ...................... 206,817
850 Kugelfisher Georg Schaef ................ 99,764
1,750 Pfaff GM AG ............................. 184,411
------------
937,751
</TABLE>
See accompanying notes.
15
<PAGE> 17
STATEMENTS OF NET ASSETS
MARCH 31, 1995
(Unaudited)
SECURITY EQUITY FUND - GLOBAL SERIES
(CONTINUED)
<TABLE>
<CAPTION>
NUMBER OF MARKET
SHARES COMMON STOCK (continued) VALUE
- - -------------------------------------------------------------------
<S> <C> <C>
HONG KONG - 2.0%
99,000 Dairy Farm International Holding ...... $ 126,767
25,000 Johnson Electric Holding .............. 58,850
120,000 Semitech Metroelectronics
Global, Ltd. ........................ 199,444
116,000 Shun Tak Holding ...................... 68,641
----------
453,702
HUNGARY - 0.1%
1,900 Fotex RT1 (ADR) ....................... 12,825
IRELAND - 2.6%
37,100 Allied Irish Bank ..................... 163,278
486,900 Waterford Glass Wedgewood
Holdings Plc ......................... 422,257
----------
585,535
ITALY - 0.4%
35,000 Finanza & Futuro Holdings
SPA ................................ 90,376
JAPAN - 15.1%
24,000 Japan Vilene Company, Ltd. ............ 165,899
18,000 Joshin Denki Company, Inc. ............ 206,544
29,000 Kankaku Securities, Ltd. .............. 121,613
10,000 Komatsu Fork Lift Company, Ltd. ....... 68,548
25,000 Makino Milling Company, Ltd. .......... 187,212
16,000 Matsushita Electrical Industrial
Company, Ltd. ....................... 258,065
15,000 Matsushita Refrigeration
Company, Ltd. ....................... 123,560
10,000 Matsuzakaya Company, Ltd. ............. 123,272
21,000 Nippon Chemi-Con Corporation .......... 129,677
3,000 Nippon Steel Corporation .............. 11,578
1,000 Nippon Yakin Kogyo
Company, Ltd. ....................... 5,415
12,000 NOK Corporation ....................... 100,092
10,000 NTN Toyo Bearing Company, Ltd. ........ 63,364
18,000 Okasan Securities, Ltd. ............... 97,465
11,000 Royal Company, Ltd. ................... 160,945
26,000 Sansui Electric Company, Ltd. ......... 72,488
10,000 Shinobu Foods Product
Company, Ltd. ...................... 116,359
4,200 Sony Corporation ...................... 210,484
11,000 Sumitomo Bank ......................... 234,447
18,000 Sumitomo Trust & Bank ................. 242,627
13,000 Wacoal ................................ 149,770
25,000 Yamaichi Securities Company, Ltd. ..... 165,611
17,000 Yamanouchi Pharmaceutical
Company, Ltd. ...................... 372,120
----------
3,387,155
MALAYSIA - 0.4%
17,000 Resorts World Bhd ..................... $ 88,338
MEXICO - 0.3%
21,200 Tubos de Acero de Mexico
S.A. (ADR) ......................... 74,200
NETHERLANDS - 4.0%
5,100 Boskalis Westminster Certificate ...... 68,128
25,600 Elsevier N.V. ......................... 268,932
2,050 Royal Dutch Petroleum Company ......... 245,665
2,400 Unilever Certificates N.V. ............ 314,065
----------
896,790
NEW ZEALAND - 2.4%
194,500 Brierly Investments, Ltd. ............. 141,411
26,700 Ceramco Corporation, Ltd. ............. 43,721
87,700 Fisher & Paykel Industries, Ltd. ...... 227,476
36,300 Independent Newspaper, Ltd. ........... 117,694
----------
530,302
NORWAY - 1.3%
3,200 Petroleum Geo-Services (ADR) .......... 71,200
16,500 Saga Petroleum ........................ 216,700
----------
287,900
PHILIPPINES - 0.9%
193,000 Filinvest Land Inc. ................... 49,564
251,000 Universal Robina ...................... 144,056
----------
193,620
SOUTH AFRICA - 0.9%
4,800 Rustenburg Platinum
Holdings, Ltd. (ADR) ............... 108,370
6,800 Samancor, Ltd. (ADR) .................. 94,112
----------
202,482
SPAIN - 1.3%
3,000 Corporacion Mapfre .................... 119,669
84 Corporacion Mapfre Vida ............... 3,563
5,800 Repsol S.A. ........................... 164,147
----------
287,379
SWITZERLAND - 1.8%
180 Nestle AG ............................. 175,707
320 Schweizerischer Bankverein ............ 105,442
145 Union Bank of Switzerland ............. 131,550
----------
412,699
</TABLE>
See accompanying notes.
16
<PAGE> 18
STATEMENTS OF NET ASSETS
MARCH 31, 1995
(Unaudited)
SECURITY EQUITY FUND - GLOBAL SERIES
(CONTINUED)
<TABLE>
<CAPTION>
NUMBER OF MARKET
SHARES COMMON STOCK (continued) VALUE
- - --------------------------------------------------------------
<S> <C> <C>
UNITED KINGDOM - 5.4%
44,600 Antofagasta Holdings Plc......... $ 216,689
23,600 BAT Industries Plc .............. 167,787
53,800 Body Shop International Plc ..... 150,733
13,000 Rio Tinto Zinc Corporation Plc .. 168,849
56,400 Takare Plc ...................... 191,815
83,100 Tomkins Plc ..................... 316,265
----------
1,212,138
UNITED STATES - 29.8%
12,200 Albemarle Corporation* .......... 155,550
4,300 Atlantic Richfield Company ...... 107,500
5,800 Bank of New York Company, Inc. .. 190,675
9,000 Barnes & Noble, Inc. ............ 273,375
2,400 Bristol-Meyers Squibb Company ... 151,200
2,400 Burlington Northern, Inc. ....... 142,500
3,000 Burlington Resources, Inc. ...... 122,250
4,600 CPC International, Inc. ......... 248,975
5,700 Capital One Financial
Corporation ................... 109,013
4,700 Chevron Corporation ............. 225,600
2,400 Colgate-Palmolive Company ....... 158,400
1,500 Dayton Hudson Corporation ....... 107,250
3,000 Disney (Walt) Company ........... 160,125
2,200 Dow Chemical Company ............ 160,600
7,000 Duracell International Inc. ..... 313,250
4,300 Fluor Corporation ............... 207,475
2,500 General Electric Company ........ 135,313
3,000 Illinois Tool Works, Inc. ....... 146,625
6,500 Ingersoll-Rand Company .......... 213,688
2,700 International Paper Company ..... 202,838
8,300 Marriott International, Inc. .... 288,425
5,000 Mellon Bank Corporation ......... 203,750
3,400 Nabisco Holdings Corporation* ... 97,325
3,200 Pepsico, Inc. ................... 124,800
5,400 Pitney Bowes, Inc. .............. 194,400
3,600 Procter & Gamble Company ........ 238,500
9,900 Rubbermaid, Inc. ................ 326,700
3,500 Schlumberger Ltd. ............... 208,688
5,700 Signet Banking Corporation ...... 116,138
3,100 Texaco, Inc. .................... 206,150
5,400 Toys 'R' Us, Inc. ............... 138,375
4,700 Travelers, Inc. ................. 181,538
4,700 Trinity Industries, Inc. ........ 175,663
4,000 USX-U.S. Steel Corporation ...... 135,000
5,700 Union Camp Corporation .......... 295,688
5,400 WalMart Stores, Inc. ............ 137,700
2,100 York International Corporation .. 82,950
----------
6,683,992
Total common stocks-
(Cost $18,961,104) - 86.2% ....... $19,328,117
GOVERNMENT BONDS - 2.8%
$600,000 Republic of Deutscheland,
7.25%, 5-22-95 ................... 437,398
$300,000 Netherlands Government Bond
6.00%, 4-15-95 ................... 194,520
-----------
Total government bonds -
(Cost $623,995) - 2.8% ........... 631,918
-----------
Total investments-
(Cost $19,812,508) - 90.0% ....... 20,193,668
Cash and other assets,
less liabilities - 10.0% ......... 2,229,608
-----------
Total net assets - 100.0% .......... $22,423,276
===========
</TABLE>
INVESTMENT CONCENTRATION
At March 31,1995, Global Series' investment concentration, by industry, was as
follows:
<TABLE>
<S> <C>
Banking .................................................. 9.7%
Capital Equipment......................................... 7.2%
Consumer Durables ........................................ 8.3%
Consumer Nondurables ..................................... 16.6%
Electrical and Electronics ............................... 1.2%
Energy ................................................... 5.9%
Financial Services ....................................... 4.4%
Healthcare ............................................... 3.6%
Materials ................................................ 7.7%
Merchandising ............................................ 6.5%
Multi-Industry ........................................... 4.7%
Services ................................................. 10.5%
Transportation ........................................... 0.9%
Government Bonds ......................................... 2.8%
Cash and other assets, less liabilities................... 10.0%
-----
Total net assets ......................................... 100.0%
</TABLE> =====
See accompanying notes.
17
<PAGE> 19
STATEMENTS OF NET ASSETS
MARCH 31, 1995
(Unaudited)
SECURITY ULTRA FUND
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES COMMON STOCK VALUE
- - ----------------------------------------------------------------
<S> <C> <C>
ADVERTISING - 1.7%
50,000 ADVO, Inc. ........................ $ 993,750
APPAREL - 3.0%
25,500 AnnTaylor Stores Corporation* ...... 949,875
34,000 Gymboree Corporation* .............. 862,750
----------
1,812,625
BANKING - 1.4%
24,500 Midlantic Corporation................ 839,125
BUILDER - 4.1%
23,500 Butler Manufacturing Company......... 851,875
68,750 Clayton Homes, Inc. ................. 1,177,344
22,350 NCI Building Systems, Inc.*.......... 391,125
----------
2,420,344
BUSINESS SERVICES - 4.9%
27,300 Alternative Resources Corporation*... 1,085,175
46,500 Copart, Inc.*........................ 883,500
21,000 Paychex, Inc. ....................... 966,000
----------
2,934,675
CASINOS - 1.6%
32,000 MGM Grand, Inc.*..................... 968,000
CHEMICALS - 1.5%
34,000 Airgas, Inc.*........................ 901,000
COMMODITIES - 1.5%
49,500 Archer-Daniels-Midland Company....... 921,938
COMMUNICATIONS - 2.6%
24,000 Commnet Celular*..................... 591,000
30,000 DSC Communications Corporation*...... 976,875
----------
1,567,875
COMMUNICATION EQUIPMENT - 3.4%
28,500 Cidco, Inc.*......................... 858,563
48,000 Scientific-Atlanta, Inc. ............ 1,122,000
----------
1,980,563
COMPUTER NETWORKING - 2.2%
23,500 3Com Corporation*.................... 1,330,688
COMPUTER SOFTWARE - 6.6%
31,500 Davidson & Associates, Inc.*......... 1,055,250
16,000 Informix Corporation*................ 550,000
17,500 Softkey International, Inc.*......... 476,875
45,000 Spectrum Holbyte, Inc.*.............. 722,813
49,000 Symantec Corporation*................ 1,127,000
----------
3,931,938
CONSUMER GOODS & SERVICES - 1.9%
42,000 Newell Company....................... $1,071,000
CONTAINERS - 1.7%
34,000 Bemis Company, Inc. ................. 998,750
DRUGS - 1.8%
16,000 Amgen, Inc.*......................... 1,078,000
ELECTRICAL MACHINERY & ELECTRONIC
COMPONENTS - 6.9%
43,000 American Power Conversion
Corporation*....................... 704,125
25,000 Atmel Corporation*................... 965,625
40,500 Cyrix Corporation*................... 885,938
22,500 Kulicke & Soffa Industries, Inc.*.... 615,938
16,382 Vishay Intertechnology, Inc.*........ 919,440
----------
4,091,066
FERTILIZER - 3.2%
20,000 IMC Global, Inc. ..................... 977,500
24,500 Vigoro Corporation, (The)............. 906,500
----------
1,884,000
FINANCE - 3.0%
21,500 First USA, Inc. ...................... 903,000
54,000 Mercury Finance Company............... 870,750
----------
1,773,750
INDUSTRIAL & MACHINERY - 2.7%
37,200 Applied Power, Inc. (CI.A)............ 925,350
26,000 Roper Industries, Inc. ............... 698,750
----------
1,624,100
INSURANCE - 2.7%
18,000 AFLAC Corporation..................... 726,750
14,500 Jefferson-Pilot Corporation........... 857,313
----------
1,584,063
MEDICAL & HEALTH CARE - 4.2%
20,500 Cardinal Health, Inc. ................ 976,313
28,500 Coram Healthcare Corporation*......... 723,188
51,000 Tenet Healthcare*..................... 809,625
----------
2,509,126
MEDICAL INSTRUMENTS & SUPPLIES - 6.1%
70,000 Research Industries Corporation*...... 1,225,000
20,500 St. Jude Medical, Inc. ............... 886,625
42,650 Sunrise Medical, Inc.*................ 1,524,738
----------
3,636,363
</TABLE>
See accompanying notes.
18
<PAGE> 20
Statement of Net Assets
MARCH 31, 1995
(Unaudited)
Security Ultra Fund (continued)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OR
NUMBER MARKET
OF SHARES COMMON STOCK (continued) VALUE
- - ----------------------------------------------------------------------------
<S> <C> <C>
NATURAL GAS PIPELINES - 1.1%
22,500 Sonat, Inc. .................................. $ 675,000
OFFICE SUPPLIES - 1.3%
24,000 Franklin Quest Company*....................... 756,000
PERSONAL CARE PRODUCTS - 1.6%
30,000 Alberto Culver (Cl.A)......................... 787,500
55,000 Zila, Inc.*................................... 195,938
-----------
983,438
PETROLEUM REFINING - 1.0%
27,000 Union Texas Petroleum Holdings, Inc. ........ 621,000
RESTAURANTS - 2.9%
30,000 IHOP Corporation*............................ 883,125
53,000 Wendy's International, Inc................... 867,875
-----------
1,751,000
RETAIL TRADE - 8.9%
16,000 Baby Superstore, Inc.*....................... 628,000
28,000 Barnes & Noble, Inc.*........................ 850,500
60,000 Casey's General Stores, Inc. ................ 952,500
25,700 Leggett & Platt, Inc. ....................... 1,079,400
31,500 Staples, Inc.*............................... 830,813
33,000 Sunglass Hut International, Inc.*............ 977,625
-----------
5,318,838
TRANSPORTATION - 1.5%
26,000 Illinois Central Corporation................. 897,000
-----------
Total common stock -
(Cost $45,707,648) - 87.0%................. 51,855,015
COMMERCIAL PAPER
DRUGS & TOILETRIES - 1.7%
$1,000,000 Schering Corporation,
5.995%, 4-25-95............................ 996,030
<CAPTION>
PRINCIPAL MARKET
AMOUNT COMMERCIAL PAPER (continued) VALUE
- - -------------------------------------------------------------------------------
<S> <C> <C>
TELEPHONE & TELEGRAPH - 3.3%
$2,000,000 Bellsouth Telecommunications, Inc.,
5.96%, 4-10-95............................. $ 1,997,020
UTILITIES - 2.5%
1,500,000 Potomac Electric Power Company,
6.27%, 4-4-95.............................. 1,499,216
-----------
Total commercial paper -
(Cost $4,492,266) - 7.5.%.................. 4,492,266
-----------
Total investments -
(Cost $50,199,914) - 94.5%................. 56,347,281
Cash and other assets, less
liabilities - 5.5%......................... 3,294,446
-----------
Total net assets - 100.0%.................... $59,641,727
===========
</TABLE>
The identified cost of investments owned at March 31, 1995, was the same for
federal income tax and financial statement purposes.
* Securities on which no cash dividend was paid during the preceding twelve
months.
ADR (American Depositary Receipt)
(1) Restricted Security (a portfolio security that may be sold privately, but
that is required to be registered with the SEC or to be exempted from such
registration before it may be sold in a public distribution.) The total value
of restricted securities in Global Series is 1.6% of total net assets.
See accompanying notes.
19
<PAGE> 21
BALANCE SHEETS
MARCH 31, 1995
(Unaudited)
<TABLE>
<CAPTION>
SECURITY EQUITY FUND
--------------------
SECURITY SECURITY
GROWTH AND INCOME EQUITY GLOBAL ULTRA
FUND SERIES SERIES FUND
-------------------------------------------------------------------
ASSETS
<S> <C> <C> <C> <C>
Investments, at value
(identified cost $57,418,667, $318,219,114, $19,812,508
and $45,707,648, respectively) ............................. $60,815,188 $381,499,688 $20,193,668 $51,855,015
Commercial paper, at amortized cost which
approximates market value .................................. 648,063 11,483,590 -- 4,492,266
Cash ......................................................... 159,681 468,071 1,565,440 1,200,747
Foreign currency ............................................. -- -- 11,936 --
Receivables:
Fund shares sold ........................................... 6,997 2,447,693 905 1,005,580
Securities sold ............................................ 1,408,343 6,497,287 1,213,966 3,195,741
Dividends .................................................. 62,540 461,563 43,531 15,610
Interest ................................................... 281,778 -- 36,819 --
Foreign taxes recoverable .................................. -- -- 20,736 --
Other receivables .......................................... -- 37 208 --
----------- ------------ ----------- -----------
Total assets ........................................... $63,382,590 $402,857,929 $23,087,209 $61,764,959
=========== ============ =========== ===========
LIABILITIES AND NET ASSETS
Liabilities:
Payable for:
Fund shares redeemed .................................... $ 31,037 $ 2,070,370 $ 8,841 $ 948,041
Securities purchased .................................... 724,550 4,178,825 610,217 1,103,083
Other Liabilities:
Management fees ......................................... 69,972 348,165 39,977 68,247
12b-1 distribution plan fees ............................ 721 11,112 4,898 3,091
Miscellaneous fees ..................................... 852 1,845 -- 770
----------- ------------ ----------- -----------
Total liabilities ..................................... 827,132 6,610,317 663,933 2,123,232
Net Assets:
Paid in capital ........................................... 59,804,648 324,713,135 22,770,644 48,999,816
Accumulated undistributed net investment income (loss) .... 217,203 5,412,135 (126,746) (118,403)
Accumulated net realized gain (loss) on sale of investments
and foreign currency holdings ....................... (862,914) 2,841,768 (604,250) 4,612,947
Net unrealized appreciation in value of investments ....... 3,396,521 63,280,574 383,628 6,147,367
----------- ------------ ----------- -----------
Net assets ............................................ 62,555,458 396,247,612 22,423,276 59,641,727
----------- ------------ ----------- -----------
Total liabilities and net assets .................. $63,382,590 $402,857,929 $23,087,209 $61,764,959
=========== ============ =========== ===========
CLASS "A" SHARES
Capital shares outstanding .................................. 8,931,783 69,116,947 1,661,106 8,108,497
Net assets .................................................. $61,697,880 $382,201,633 $16,842,657 $56,040,246
Net asset value per share (net assets divided by
shares outstanding) ....................................... $6.91 $5.53 $10.14 $6.91
Add: Selling commission (5.75% of the offering price) ....... 0.42 0.34 0.62 0.42
----------- ------------ ----------- -----------
Offering price per share (net asset
value divided by 94.25%)................................... $7.33 $5.87 $10.76 $7.33
=========== ============ =========== ===========
CLASS "B" SHARES
Capital shares outstanding .................................. 125,412 2,575,042 557,913 524,192
Net assets .................................................. $ 857,578 $ 14,045,979 $ 5,580,619 $ 3,601,481
Net asset value per share
(net assets divided by shares outstanding) ................ $6.84 $5.45 $10.00 $6.87
=========== ============ =========== ===========
</TABLE>
See accompanying notes.
20
<PAGE> 22
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED MARCH 31, 1995
(Unaudited)
<TABLE>
<CAPTION>
Security Equity Fund
--------------------
Security Security
Growth and Income Equity Global Ultra
Fund Series Series Fund
----------------- ------ ------ ----------
<S> <C> <C> <C> <C>
Investment Income:
Interest........................................ $ 732,871 $ 947,135 $ 1,381 $ 174,800
Dividend........................................ 454,642 2,610,118 142,899 114,141
Miscellaneous................................... 30,000 -- -- --
------------ ------------ ---------- ----------
1,217,513 3,557,253 144,280 288,941
Less foreign tax expense................ -- -- 10,224 --
------------ ------------ ---------- ----------
Total investment income................. 1,217,513 3,557,253 134,056 288,941
Expenses:
Management fees................................. 410,591 1,947,732 236,720 397,639
12b-1 distribution plan fees (Class B).......... 3,727 49,706 24,082 9,699
Interest........................................ -- -- -- 6
------------ ------------ ---------- ----------
Total expenses.......................... 414,318 1,997,438 260,802 407,344
------------ ------------ ---------- ----------
Net investment income (loss).... 803,195 1,559,815 (126,746) (118,403)
Realized and unrealized gain (loss)
on investments:
Realized gain (loss) on sale of investments:
Proceeds from sale of investments....... 50,662,528 194,453,601 14,145,613 46,209,583
Cost of investments sold................ 51,580,371 186,075,333 14,820,205 43,792,175
------------ ------------ ---------- ----------
Net realized gain (loss)........ (917,843) 8,378,268 (674,592) 2,417,408
Unrealized appreciation (depreciation) of
investments:
Beginning of year........................ 1,166,701 43,930,276 835,690 6,360,077
End of period............................ 3,396,521 63,280,574 383,628 6,147,367
------------ ------------ ---------- ----------
Unrealized appreciation (depreciation)
of investments during the period..... 2,229,820 19,350,298 (452,062) (212,710)
------------ ------------ ---------- ----------
Net gain (loss) on investments... 1,311,977 27,728,566 (1,126,654) 2,204,698
------------ ------------ ---------- ----------
Net increase (decrease) in net
assets resulting from
operations.................... $ 2,115,172 $29,288,381 $(1,253,400) $2,086,295
============ ============ =========== ==========
</TABLE>
See accompanying notes.
21
<PAGE> 23
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED MARCH 31, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
SECURITY EQUITY FUND
---------------------
SECURITY SECURITY
GROWTH AND INCOME EQUITY GLOBAL ULTRA
FUND SERIES SERIES FUND
------------------- ------- ------- -----------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets from operations:
Net investment income (loss) ................................ $ 803,195 $ 1,559,815 $ (126,746) $ (118,403)
Net realized gain (loss) on sale of investments ............. (917,843) 8,378,268 (674,592) 2,417,408
Unrealized appreciation (depreciation) during the period .... 2,229,820 19,350,298 (452,062) (212,710)
----------- ------------ ----------- -----------
Net increase (decrease) in net assets resulting
from operations ..................................... 2,115,172 29,288,381 (1,253,400) 2,086,295
Distributions to shareholders from:
Net investment income
Class A .................................................. (668,020) -- -- --
Class B .................................................. (5,394) -- -- --
Net realized gain on sale of investments
Class A .................................................. (1,912,985) (26,300,089) (347,497) (1,149,268)
Class B .................................................. (23,632) (690,644) (84,333) (28,511)
---------- ------------ ----------- -----------
Total distributions to shareholders ..................... (2,610,031) (26,990,733) (431,830) (1,177,779)
Capital share transactions (a):
Proceeds from sale of shares
Class A .................................................. 1,507,205 74,401,225 2,859,090 53,714,529
Class B .................................................. 309,947 16,878,453 2,956,421 5,033,455
Dividends reinvested
Class A .................................................. 2,342,870 24,498,990 340,567 1,088,380
Class B .................................................. 28,310 690,270 84,020 28,509
Shares redeemed
Class A .................................................. (6,984,333) (76,983,644) (5,119,260) (60,314,849)
Class B .................................................. (149,366) (11,224,243) (1,100,445) (2,765,803)
----------- ------------ ----------- -----------
Net increase (decrease) from capital share transactions ..... (2,945,367) 28,261,051 20,393 (3,215,779)
---------- ------------ ----------- -----------
Total increase (decrease) in net assets ..................... (3,440,226) 30,558,699 (1,664,837) (2,307,263)
Net assets:
Beginning of period ........................................ 65,995,684 365,688,913 24,088,113 61,948,990
----------- ------------ ----------- -----------
End of period .............................................. $62,555,458 $396,247,612 $22,423,276 $59,641,727
=========== ============ =========== ===========
Undistributed net investment income (loss) at end of
period .................................................... $217,203 $5,412,135 $(126,746) $(118,403)
=========== ============ =========== ===========
(a) Shares issued and redeemed:
Shares sold
Class A ............................................ 223,876 13,954,909 276,152 7,984,045
Class B ............................................ 46,907 3,194,161 289,158 746,766
Dividends reinvested
Class A ............................................ 353,407 4,858,019 33,389 164,782
Class B ............................................ 4,314 138,525 8,327 4,329
Shares redeemed
Class A ............................................ (1,030,272) (14,407,680) (505,235) (8,939,722)
Class B ............................................ (22,635) (2,115,004) (107,988) (411,000)
----------- ------------ ----------- -----------
Net increase (decrease) ........................... (424,403) 5,622,930 (6,197) (450,800)
=========== ============ =========== ===========
</TABLE>
See accompanying notes.
22
<PAGE> 24
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED SEPTEMBER 30, 1994
<TABLE>
<CAPTION>
SECURITY EQUITY FUND
--------------------
SECURITY SECURITY
GROWTH AND INCOME EQUITY GLOBAL ULTRA
FUND SERIES SERIES FUND
-------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income (loss) ........................ $ 1,261,142 $ 3,165,837 $ (63,054) $ (492,428)
Net realized gain on sale of investments............. 2,952,894 28,999,838 502,173 2,698,928
Unrealized appreciation (depreciation)
during the year.................................... (10,068,384) (25,585,163) 835,690 (4,046,772)
----------- ----------- ----------- ------------
Net increase (decrease) in net assets resulting
from operations................................ (5,854,348) 6,580,512 1,274,809 (1,840,272)
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Class A........................................... (1,282,878) (6,495,995) -- --
Class B........................................... (4,016) (3,001) -- --
Net realized gain on sale of investments
Class A........................................... (1,709,797) (65,230,492) -- (8,147,095)
Class B........................................... (1,855) (30,137) -- (4,565)
----------- ----------- ----------- ------------
Total distributions to shareholders............ (2,998,546) (71,759,625) -- (8,151,660)
CAPITAL SHARE TRANSACTIONS (A):
Proceeds from sale of shares
Class A........................................... 7,680,929 173,504,752 24,256,624 59,208,377
Class B........................................... 1,401,417 13,572,886 4,059,395 2,182,716
Dividends reinvested
Class A........................................... 2,687,871 66,562,965 -- 7,719,477
Class B........................................... 5,609 32,937 -- 3,114
Shares redeemed
Class A........................................... (18,206,699) (192,197,708) (5,344,170) (67,279,953)
Class B........................................... (702,391) (6,172,823) (158,545) (949,360)
----------- ----------- ----------- ------------
Net increase (decrease) from capital
transactions.................................... (7,133,264) 55,303,009 22,813,304 884,371
----------- ----------- ----------- ------------
Total increase (decrease) in net assets........ (15,986,158) (9,876,104) 24,088,113 (9,107,561)
NET ASSETS:
Beginning of year.................................... 81,981,842 375,565,017 -- 71,056,551
----------- ----------- ----------- ------------
End of year.......................................... $65,995,684 $365,688,913 24,088,113 $61,948,990
----------- ----------- ----------- ------------
Undistributed net investment income at
end of year........................................ $87,422 $3,852,320 $ -- $ --
=========== =========== =========== ============
(a) Shares issued and redeemed:
Shares sold
Class A....................................... 1,028,902 30,498,096 2,354,656 8,545,741
Class B....................................... 196,294 2,488,139 383,242 326,136
Dividends reinvested
Class A....................................... 363,018 11,982,532 -- 1,079,043
Class B....................................... 789 5,929 -- 436
Shares redeemed
Class A....................................... (2,465,336) (33,603,067) (497,856) (9,467,423)
Class B....................................... (100,257) (1,136,708) (14,826) (142,475)
----------- ----------- ----------- ------------
Net increase (decrease)....................... (976,590) 10,234,921 2,225,216 341,458
=========== =========== =========== ============
</TABLE>
See accompanying notes.
23
<PAGE> 25
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR EACH SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
Net Total
Fiscal asset Net Net gains from Dividends Distribu-
year value invest- or losses on invest- (from net tions Net asset
ended beginn- ment securities ment invest- (from Total value
Septem- ing of income (realized & opera- ment in- capital distri- end of
ber 30 period (loss) unrealized) tions come) gains) butions period
- - ------------------------------------------------------------------------------------------------------------------------------------
SECURITY GROWTH AND INCOME FUND (CLASS A)(b)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1990 $9.06 $0.52 $(0.978) $(0.458) $(0.509) $(0.663) $(1.172) $7.43
1991 7.43 0.45 0.992 1.442 (0.474) (1.088) (1.562) 7.31
1992 7.31 0.35 (0.016) 0.334 (0.343) (0.171) (0.514) 7.13
1993 7.13 0.21 0.876 1.086 (0.218) (0.158) (0.376) 7.84
1994(e) 7.84 0.13 (0.713) (0.583) (0.128) (0.169) (0.297) 6.96
1995(g) 6.96 0.09 0.150 0.240 (0.075) (0.215) (0.290) 6.91
<CAPTION>
SECURITY GROWTH AND INCOME FUND (CLASS B)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1994(e) $7.83 $0.05 $(0.694) $(0.644) $(0.117) $(0.169) $(0.286) $6.90
1995(g) 6.90 0.05 0.150 0.200 (0.045) (0.215) (0.260) 6.84
<CAPTION>
SECURITY EQUITY SERIES (CLASS A)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1990 $6.53 $0.15 $(1.115) $(0.965) $(0.166) $(0.579) $(0.745) $4.82
1991 4.82 0.12 1.403 1.523 (0.148) (0.375) (0.523) 5.82
1992 5.82 0.09 0.475 0.565 (0.132) (0.393) (0.525) 5.86
1993 5.86 0.12 1.165 1.285 (0.053) (0.362) (0.415) 6.73
1994(e) 6.73 0.05 0.085 0.135 (0.120) (1.205) (1.325) 5.54
1995(g) 5.54 0.02 0.377 0.397 -- (0.407) (0.407) 5.53
<CAPTION>
SECURITY EQUITY SERIES (CLASS B)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1994(e) $6.81 $0.01 $(0.005) $0.005 $(0.12) $(1.205) $(1.325) $5.49
1995(g) 5.49 (0.01) 0.377 0.367 -- (0.407) (0.407) 5.45
<CAPTION>
SECURITY GLOBAL SERIES (CLASS A)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1994(e)(f) $10.00 $(0.03) $ 0.87 $0.84 $ -- $ -- $ -- $10.84
1995(g) 10.84 (0.06) (0.45) (0.51) -- (0.19) (0.19) 10.14
<CAPTION>
SECURITY GLOBAL SERIES (CLASS B)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1994(e)(f) $9.96 $(0.12) $ 0.91 $0.79 $ -- $ -- $ -- $10.75
1995(g) 10.75 (0.06) (0.50) (0.56) -- (0.19) (0.19) 10.00
</TABLE>
<TABLE>
<CAPTION>
Ratio of
Fiscal net
year Net assets Ratio of income
ended end of expenses (loss) to Portfolio
Septem- Total period to average average turnover
ber 30 return(a) (thousands) net assets net assets rate
- - ------------------------------------------------------------------------------------------------------------------------------------
SECURITY GROWTH AND INCOME FUND (CLASS A)(b)
<S> <C> <C> <C> <C> <C>
1990 (5.80%) $70,588 1.28% 6.24% 66%
1991 22.30% 77,418 1.28% 6.14% 103%
1992 4.70% 75,436 1.27% 4.79% 74%
1993 15.60% 81,982 1.26% 2.80% 135%
1994(e) (7.60%) 65,328 1.28% 1.70% 163%
1995(g) 3.66% 61,698 1.32% 2.60% 171%
<CAPTION>
SECURITY GROWTH AND INCOME FUND (CLASS B)
<S> <C> <C> <C> <C> <C>
1994(e) (8.00%) $668 2.27% 1.03% 178%
1995(g) 3.08% 858 2.32% 1.61% 171%
<CAPTION>
SECURITY EQUITY SERIES (CLASS A)
<S> <C> <C> <C> <C> <C>
1990 (15.90%) $226,186 1.08% 2.72% 97%
1991 34.20% 295,030 1.08% 2.34% 61%
1992 10.20% 313,582 1.06% 1.48% 83%
1993 22.70% 375,565 1.06% 1.95% 95%
1994(e) 1.95% 358,237 1.06% 0.86% 79%
1995(g) 7.88% 382,202 1.05% 0.87% 114%
<CAPTION>
SECURITY EQUITY SERIES (CLASS B)
<S> <C> <C> <C> <C> <C>
1994(e) (0.15%) $7,452 2.07% (0.01%) 80%
1995(g) 7.38% 14,046 2.06% (0.11%) 114%
<CAPTION>
SECURITY GLOBAL SERIES (CLASS A)
<S> <C> <C> <C> <C> <C>
1994(e)(f) 8.40% $20,128 2.0% (0.01%) 73%
1995(g) (4.72%) 16,843 2.0% (0.81%) 107%
<CAPTION>
SECURITY GLOBAL SERIES (CLASS B)
<S> <C> <C> <C> <C> <C>
1994(e)(f) 7.90% $3,960 3.0% (0.01%) 73%
1995(g) (5.23%) 5,581 3.0% (1.72%) 107%
</TABLE>
See accompanying notes.
24
<PAGE> 26
FINANCIAL HIGHLIGHTS (CONTINUED)
SELECTED DATA FOR EACH SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH
PERIOD
<TABLE>
<CAPTION>
Net Total
Fiscal asset Net gains from Distribu-
year value Net or losses on invest- Dividends tions Net asset Net assets
ended beginn- invest- securities ment (from net (from Total value end of
Septem- ing of ment (realized & opera- investment capital distri- end of Total period
ber 30 period loss unrealized) tions income) gains) butions period return(a) (thousands)
- - -------- -------- -------- ------------- -------- --------- ------- ------- ---------- ---------- -----------
SECURITY ULTRA FUND (CLASS A)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1990(c) $7.89 $(0.140) $(2.845) $(2.985) $ -- $(0.445) $(0.445) $4.46 (39.60%) $31,486
1991(c)(d) 4.46 (0.030) 2.525 2.495 -- (0.235) (0.235) 6.72 58.40% 65,449
1992 6.72 (0.090) (0.202) (0.292) -- (0.172) (0.172) 6.66 1.50% 57,128
1993 6.66 (0.028) 1.791 1.763 -- (0.293) (0.293) 8.13 26.80% 71,056
1994(e) 8.13 (0.056) (0.188) (0.244) -- (1.066) (1.066) 6.82 (3.60%) 60,695
1995(g) 6.82 (0.010) 0.235 0.225 -- (0.135) (0.135) 6.91 3.39% 56,040
<CAPTION>
SECURITY ULTRA FUND (CLASS B)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1994(e) $8.30 $(0.103) $(0.321) $(0.424) $ -- $(1.066) $(1.066) $6.81 (5.70%) $ 1,254
1995(g) 6.81 (0.040) 0.235 0.195 -- (0.135) (0.135) 6.87 2.95% 3,601
<CAPTION>
Fiscal
year Ratio of Ratio of
ended expenses net loss Portfolio
Septem- to average to average turnover
ber 30 net assets net assets rate
- - -------- ---------- ---------- ---------
SECURITY ULTRA FUND (CLASS A)
<S> <C> <C> <C>
1990(c) 2.58% (1.82%) 96%
1991(c)(d) 1.61% (0.51%) 163%
1992 1.32% (0.46%) 142%
1993 1.30% (0.50%) 101%
1994(e) 1.33% (0.80%) 111%
1995(g) 1.33% (0.36%) 151%
<CAPTION>
SECURITY ULTRA FUND (CLASS B)
<S> <C> <C> <C>
1994(e) 2.36% (1.76%) 110%
1995(g) 2.34% (1.36%) 151%
</TABLE>
(a) Total return information does not reflect deduction of any sales charges
imposed at the time of purchase for Class A shares or upon redemption
for Class B shares.
(b) Effective July 6, 1993, Security Growth and Income Fund changed its
investment objective from investing for income with secondary emphasis
on long-term capital growth to long-term capital growth with secondary
emphasis on income. Effective the same date the fund changed its name
from Security Investment Fund to Security Growth and Income Fund.
(c)
<TABLE>
<CAPTION>
Weighted
average debt Weighted
Debt outstanding outstanding during average month- Average debt Interest expense
Year at end of period the period end shares outstanding per share per share
---- ---------------- ------------------ ----------------------- ------------ ----------------
<S> <C> <C> <C> <C> <C> <C>
Security Ultra Fund 1990 $8,207,425 $5,948,569 7,713,750 $.77 $.08
Security Ultra Fund 1991 -- 970,096 8,817,652 .11 .01
</TABLE>
Borrowings and related interest, if any, were immaterial in 1992, 1993,
1994, and six month period ended March 31, 1995.
(d) Portfolio turnover calculation excludes the portfolio investments
acquired in the Omni Fund merger. Per share data has been calculated
using the average month-end shares outstanding.
(e) Class "B" Shares were initially issued on October 19, 1993. Percentage
amounts for the period, except total return, have been annualized. Per
share data has been calculated using the average month-end shares
outstanding.
(f) Security Global Series was initially capitalized on October 1, 1993,
with a net asset value of $10 per share.
(g) For the six months ended March 31, 1995 (unaudited). Percentage
amounts for the period, except total return, have been annualized.
Per share data has been calculated using the average month-end shares
outstanding.
See accompanying notes.
25
<PAGE> 27
NOTES TO FINANCIAL STATEMENTS
MARCH 31,1995
1. SIGNIFICANT ACCOUNTING POLICIES
Security Growth and Income, Equity, and Ultra Funds (the Funds) are
registered under the Investment Company Act of 1940, as amended, as diversified
open-end management investment companies. The shares of Security Equity Fund
are currently issued in two Series, the Equity Series and the Global Series,
(which was initially capitalized on October 1, 1993) with each Series, in
effect representing a separate Fund. The Equity Fund is required to account for
each Series separately. The Funds began offering an additional class of shares
("B" shares) to the public on October 19, 1993. The shares are offered without
a front-end sales charge but incur additional class - specific expenses.
Redemptions of the shares within five years of acquisition incur a contingent
deferred sales charge. The following is a summary of the significant accounting
policies followed by the Funds in the preparation of their financial
statements.
A. SECURITY VALUATION - Valuations of the Funds' securities are supplied by a
pricing service approved by the Board of Directors. Securities listed or traded
on a national securities exchange are valued on the basis of the last sales
price. If there are no sales on a particular day, then the securities are
valued at the mean between the bid and the asked prices. If a mean cannot be
determined then the securities are valued at the best available current bid
price. All other securities for which market quotations are available are
valued on the basis of the current bid price. If there is no bid price or if
the bid price is deemed to be unsatisfactory by the Board of Directors or the
Funds' investment manager, then the securities are valued in good faith by such
method as the Board of Directors determines will reflect the fair market value.
The Funds generally will value short-term debt securities at prices based on
market quotations for securities of similar type, yield, quality and duration,
except that securities purchased with 60 days or less to maturity are valued on
the basis of the amortized cost valuation technique.
Generally, trading in foreign securities markets is substantially completed
each day at various times prior to the close of the New York Stock Exchange.
The values of foreign securities are determined as of the close of such foreign
markets or the close of the New York Stock Exchange if earlier. All investments
quoted in foreign currency are valued in U.S. dollars on the basis of the
foreign currency exchange rate prevailing at the close of business.
Foreign Currency Transactions--Foreign currencies (and foreign currency
receivables and payables) are translated into U.S. dollar amounts at the
current exchange rate. Translation gains or losses resulting from changes in
exchange rates and realized gains and losses on the settlement of foreign
currency transactions are reported in the statement of operations. In addition,
Global Series may enter into forward foreign exchange contracts in order to
manage against foreign currency risk from purchase or sale of securities
denominated in foreign currency. Global Series may also enter into such
contracts to manage changes in foreign currency exchange rates on portfolio
positions. These contracts are marked to market daily, by recognizing the
difference between the contract exchange rate and the current market rate as
unrealized gains or losses. Realized gains or losses are recognized when
contracts are settled and are reflected in the statement of operations. These
contracts involve market risk in excess of the amount reflected in the Balance
Sheet. The face or contract amount in U.S. dollars reflects the total exposure
the Global Series has in that particular currency contract. Losses may arise
due to changes in the value of the foreign currency or if the counterparty does
not perform under the contract.
B. TAXES - The Funds complied with the requirements of the Internal Revenue
Code applicable to regulated investment companies and distributed its taxable
net income and net realized gains sufficient to relieve them from all, or
substantially all, federal income, excise and state income taxes. Therefore, no
provision for federal or state income tax is required.
C. OTHER - Security transactions are accounted for on the date the
securities are purchased or sold. Realized gains and losses are reported on an
identified cost basis. Dividend income and distributions to shareholders are
recorded on the ex-dividend date. Premiums and discounts (except original issue
discounts) on debt securities are not amortized.
2. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Under terms of the investment advisory contracts, Security Management
Company (SMC) agrees to provide, or arrange for others to provide, all the
services required by the Funds for a single fee, including investment advisory
services, transfer agent services and certain other administrative services.
For Growth and Income Fund, Equity Series and Ultra Fund this fee is equal to
2% of the first $10 million of the average daily closing value of each Fund's
net assets, 1 1/2% of the next $20 million, and 1% of the remaining net asset
value of the Fund for the fiscal year, determined daily and payable monthly.
For Global Series this fee is equal to 2% of the first $70 million of the
average daily closing value of the Fund's net assets and 1 1/2% of the
remaining average net assets of the Fund, for the fiscal year, determined daily
and payable monthly. Additionally, SMC agrees to assume all of the Funds'
expenses, except for its fee and the expenses of interest, taxes, brokerage
commissions, extraordinary items and Class B distribution fees. SMC pays the
Sub-Advisor, Lexington Management Corporation (LMC), an annual fee in an amount
equal to .50% of the average daily net assets of Global Series, computed on a
daily basis and payable monthly for investment advisory and certain
administrative services provided to the Global Series.
The Funds have adopted Distribution Plans related to the offering of Class B
shares pursuant to Rule 12b-1 under the Investment Company Act of 1940. The
Plans provide for payments at an annual rate of 1.0% of the average net assets
of each Fund's Class B shares.
26
<PAGE> 28
NOTES TO FINANCIAL STATEMENTS
Security Distributors, Inc. (SDI), a wholly-owned subsidiary of SMC and the
national distributor for the Funds, received net underwriting commissions after
allowances to brokers and dealers in the amounts presented in the following
table:
<TABLE>
<CAPTION>
GROWTH AND EQUITY GLOBAL ULTRA
INCOME FUND SERIES SERIES FUND
----------- ------ ------ ----
<S> <C> <C> <C> <C>
SDI underwriting $ 2,752 $ 45,616 $ 2,669 $ 9,787
Broker/Dealer $14,848 $245,911 $12,886 $48,002
</TABLE>
Certain officers and directors of the Funds are also officers and/or
directors of Security Benefit Life Insurance Company and its subsidiaries,
which include SMC and SDI.
3. FEDERAL INCOME TAX MATTERS
For federal income tax purposes, the amounts of unrealized appreciation
(depreciation) at March 31, 1995, were as follows:
<TABLE>
<CAPTION>
GROWTH
AND EQUITY GLOBAL ULTRA
INCOME FUND SERIES SERIES FUND
----------- ------ ------ ----
<S> <C> <C> <C> <C>
Gross unrealized
appreciation $3,867,184 $64,855,821 $1,219,564 $6,759,719
Gross unrealized
depreciation (470,663) (1,575,247) (835,936) (612,352)
---------- ----------- ---------- ----------
Net unrealized
appreciation $3,396,521 $63,280,574 $ 383,628 $6,147,367
========== =========== ========== ==========
</TABLE>
4. INVESTMENT TRANSACTIONS
Investment transactions for the six months ended March 31, 1995, (excluding
overnight investments and short-term commercial paper) are as follows:
<TABLE>
<CAPTION>
GROWTH
AND EQUITY GLOBAL ULTRA
INCOME FUND SERIES SERIES FUND
----------- ------ ------ ----
<S> <C> <C> <C> <C>
Purchases $48,586,536 $214,871,198 $12,993,249 $39,970,465
Proceeds from sales $50,662,528 $194,453,601 $14,145,613 $46,209,583
</TABLE>
5. INVESTMENT RISKS
The Global Series investments in foreign securities may involve risks not
present in domestic investments. Since foreign securities may be denominated in
a foreign currency and involve settlement and pay interest or dividends in
foreign currencies, changes in the relationship of these foreign currencies to
the U.S. dollar can significantly affect the value of the investments and
earnings of the Global Series. Foreign investments may also subject the Global
Series to foreign government exchange restrictions, expropriation, taxation or
other political, social or economic developments, all of which could affect the
market and/or credit risk of the investments.
27
<PAGE> 29
THE SECURITY GROUP OF MUTUAL FUNDS
Security Growth and Income Fund
Security Equity Fund
- Equity Series
- Global Series
Security Ultra Fund
Security Income Fund
- Corporate Bond Series
- U.S. Government Series
- Limited Maturity Bond Series
Security Tax-Exempt Fund
Security Cash Fund
This report is submitted for the general information of the shareholders of the
Funds. The report is not authorized for distribution to prospective investors
in the Funds unless preceded or accompanied by an effective prospectus which
contains details concerning the sales charges and other pertinent information.
[LOGO]
700 SW Harrison St.
Topeka, KS 66636-0001
(913) 295-3127
(800) 888-2461
SECURITY FUNDS
OFFICERS AND DIRECTORS
DIRECTORS
Willis A. Anton
Donald A. Chubb, Jr.
John D. Cleland
Jack H. Hamilton
Donald L. Hardesty
Penny A. Lumpkin
Mark L. Morris, Jr., D.V.M.
Jeffrey B. Pantages
Harold G. Worswick
OFFICERS
John D. Cleland, President
James R. Schmank, Vice President and Treasurer
Mark E. Young, Vice President
Terry A. Milberger, Vice President, Equity Fund
Amy J. Lee, Secretary
Brenda M. Luthi, Assistant Treasurer and Assistant Secretary
BULK RATE
U.S. POSTAGE PAID
TOPEKA, KS
PERMIT NO. 385
