<PAGE>
- --------------------------------------------------------------------------------
SEMI-ANNUAL REPORT
[LOGO]
BJB
Global
Income
Fund
BJB
International
Equity
Fund
April 30, 1998
<PAGE>
This report is sent to the shareholders of the BJB Investment Funds for their
information. It is not a Prospectus, circular or representation intended for use
in the purchase or sale of shares of the Funds or of any securities mentioned in
the report.
<PAGE>
BJB INVESTMENT FUNDS
BJB GLOBAL INCOME FUND SEMI-ANNUAL REPORT
AND BJB INTERNATIONAL EQUITY FUND APRIL 30, 1998
- --------------------------------------------------------------------------------
Dear Fellow Shareholder:
I am extremely pleased at having been elected President of the BJB
Investment Funds (the 'Funds') at a Special Board of Trustees Meeting held on
May 21, 1998. David Bodner, resigned as President of the Funds at our March
quarterly Board Meeting in order to pursue personal interests related to his
recent retirement. At the same meeting, Bernard Spilko, the prior Chief
Financial Officer, was elected Chairman of the Trust, replacing Peter Widmer.
Management wishes to thank both Mr. Bodner and Mr. Widmer for their dedication
and hard work throughout their tenure with the Funds.
During the first half of the current fiscal year, the BJB International
Equity Fund ('Equity Fund') continued to provide shareholders with excellent
results, significantly outperforming both its benchmark index and the average of
our competitor's funds with a positive return of +30.66% for the six months
ended April 30, 1998. Based on its continued excellent performance record, the
Equity Fund has recently received a Five Star ranking from Morningstar, Inc. The
BJB Global Income Fund ('Income Fund') performed well over the same six-month
period, providing a positive return of +2.51% and outperforming its benchmark
index as detailed in the section below.
BJB GLOBAL INCOME FUND
For the six months ended on April 30, 1998, the Income Fund had a positive
return of +2.51% compared with +2.06% for the equally blended Salomon Brothers
World Government Bond Index and the Lehman Brothers Intermediate Government
Corporate Bond Index. The Income Fund performance relative to the index is
mostly attributable to two central factors: 1) The Income Fund portfolio's
longer average duration resulted in more capital gain during rising bond
markets: 2)The Income Fund was underweight Japanese Yen, which continued to
depreciate relative to the U.S. dollar.
During the period under review, investors' central focus was on developments
in the Asian region. The period witnessed continued financial difficulties in
the region, following the collapse of several financial institutions in Japan
and rescue packages in Indonesia and South Korea. The collapse of five key Asian
currencies and significant declines in several others has severely damaged
economic prospects within the region creating a negative impact on the outlook
for U.S. and European growth.
In Japan, there has been further evidence that the country could be sliding
into recession. New high profile bankruptcies and continued weak economic data
have all added to the gloomy environment.
However, the extent to which the Asian difficulties will have an impact on
global growth is still an open question. The U.S. economy continues to grow at a
healthy pace, with 1998 first quarter GDP of more than 4% and little sign of a
slowdown. Nevertheless, inflation remains at a low level, aided by declining
commodity prices. Hence, in this environment, the G-3 central banks have left
interest rates stable.
In Europe, the main focus has been on the progress towards the European
Monetary Union and the formation of the single currency Euro. With confirmation,
at the beginning of May, that eleven countries will go forward and convert their
currencies into the Euro at the beginning of 1999, further convergence of
interest rates amongst these countries has occurred.
Overall, bond markets have shown positive returns, helped by the low levels
of inflation and the anticipation of slower economic activity as a result of the
Asian crisis. In the currency markets, the U.S. dollar continued to appreciate,
both versus the European currencies and the Japanese Yen.
During this period, the duration of the portfolio was extended through the
purchase of longer dated bonds in order to take advantage of the potential
capital gain available from declining bond yields. Within Europe, exposure to
peripheral European countries, such as Italy and Spain was reduced, reflecting
the fact that interest rates amongst these countries have broadly converged with
those in central Europe. In terms of currency exposure, the portfolio has
maintained hedges into the U.S. dollar, reflecting the expectation of continued
dollar strength.
<PAGE>
BJB INTERNATIONAL EQUITY FUND
The BJB International Equity Fund outperformed both the MSCI EAFE Index and
our average competitor over the 6-month, 12-month, and 3-year periods ending
April 30, 1998. The Equity Fund returned +30.66% for the past 6 months, +38.52%
over the past 12 months, and +84.09% over the past 3 years versus MSCI EAFE's
returns of +15.44%, +18.91%, and +31.30% over comparable periods. Returns for
the Lipper International Equity Fund Index, a reasonable proxy for our
competitors, were +16.60%, +21.53%, and +55.82% respectively:
<TABLE>
<CAPTION>
AGGREGATE TOTAL RETURN
--------------------------------------------------------
6-MONTH 1-YEAR 3-YEAR
10/31/97-4/30/98 4/30/97-4/30/98 4/30/95-4/30/98
---------------- ---------------- ----------------
<S> <C> <C> <C>
BJB INTL. EQUITY FUND................................................. 30.66% 38.52% 84.09%
MSCI EAFE WITH NET DIVIDENDS REINVESTED............................... 15.44% 18.91% 31.30%
LIPPER INTL. EQUITY FUND INDEX........................................ 16.60% 21.53% 55.82%
BJB VS. EAFE.......................................................... +15.22% +19.61% +52.79%
BJB VS. LIPPER........................................................ +14.06% +16.99% +28.27%
</TABLE>
The Equity Fund's strong results during the past 6 months can be attributed
to a number of factors: At the regional level, the Fund has emphasized
continental Europe at the expense of Japan. We continue to believe continental
European companies will benefit from economic recovery, corporate restructuring,
and consolidation in several industries as a natural response to the planned
European Monetary Union. Japan remains unattractive as it tries to resolve its
cyclical and structural problems. Also, we significantly reduced our exposure in
Asia and Latin America in the initial stages of the Asian Contagion. We
recognized early on, that the currency devaluation in many Asian countries would
effectively bankrupt many local companies.
At the country level, we have emphasized countries in the European
periphery, such as Italy, Portugal, and Spain, as the major beneficiaries of
interest rate convergence. We also recently added a relatively sizable position
in Greece in the aftermath of the country's application to enter the European
Monetary Union by the year 2001.
At the sector and stock level, we have redeployed some of our European
investments into companies that have significant domestic operations. Before the
outbreak of the Asian problems, we had many investments in corporations with
geographically diversified sales with a sustainable competitive advantage. Given
the current distressed situation in emerging markets, global exposure has in
some cases become a liability. Hence, we are emphasizing sectors such as banks,
insurance, and telecommunication. Looking forward, economic data from Europe
indicates that European economies and corporate profits are accelerating. As a
result, we may increase emphasis on stocks and sectors that are more sensitive
to economic growth.
We expect the equity market to become more volatile as a result of higher
equity valuations and nervousness about the possibility of an increase in U.S.
interest rates. However, despite the increased volatility, we expect European
equities to continue their strong performance, underpinned by the pipeline of
positive news on the cyclical and structural front.
I would like to inform shareholders that effective July 1, 1998 the name of
the BJB Investment Funds will be changed to the Julius Baer Investment Funds.
The new names of each Fund will be the Julius Baer International Equity Fund and
Julius Baer Global Income Fund.
Finally, I would like to thank you for your continued confidence and
support.
Sincerely,
/s/ Michael Quain
Michael Quain
President
June 9, 1998
The views expressed in this shareholder letter reflect those of the
President of the Fund only through the end of the period covered by the report
as stated on the cover. This shareholder letter contains certain forward looking
statements regarding the intent, belief or current expectations of the
President. Shareholders are cautioned that such forward looking statements are
not guarantees of future performance and involve risks and uncertainties and
that actual results may differ materially from those in the forward looking
statements, as a result of various factors. The President's views are subject to
change based on market and other conditions.
2
<PAGE>
BJB INVESTMENT FUNDS
BJB GLOBAL INCOME FUND
PORTFOLIO OF INVESTMENTS
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
FACE VALUE
CURRENCY VALUE (NOTE 1)
- --------- ------------- -----------
U.S. GOVERNMENT OBLIGATIONS -- 53.6%
<S> <C> <C> <C>
Federal Home Loan Mortgage Corporation,
USD 195,000 6.750% due 05/30/2006........................................................... $ 203,873
Federal National Mortgage Association:
USD 220,000 5.625% due 03/15/2001........................................................... 219,208
USD 530,000 7.400% due 07/01/2004........................................................... 571,446
Government National Mortgage Association (Pass Through),
USD 659,308 7.500% due 09/15/2025........................................................... 677,233
Tennessee Valley Authority,
USD 170,000 6.000% due 03/15/2013........................................................... 167,841
U.S. Treasury Bonds:
USD 220,000 7.875% due 11/15/2004........................................................... 245,366
USD 320,000 8.750% due 05/15/2017........................................................... 417,952
USD 50,000 8.750% due 08/15/2020........................................................... 66,400
USD 380,000 8.125% due 08/15/2021........................................................... 477,671
USD 340,000 8.000% due 11/15/2021........................................................... 422,518
U.S. Treasury Notes:
USD 720,000 6.000% due 08/15/1999........................................................... 723,377
USD 80,000 5.375% due 01/31/2000........................................................... 79,704
USD 940,000 5.750% due 11/15/2000........................................................... 942,632
USD 50,000 6.625% due 03/31/2002........................................................... 51,617
USD 570,000 7.500% due 02/15/2005........................................................... 625,689
USD 240,000 6.500% due 10/15/2006........................................................... 251,304
-----------
TOTAL U.S. GOVERNMENT OBLIGATIONS (COST $6,251,798)............................... 6,143,831
-----------
<CAPTION>
FOREIGN GOVERNMENT BONDS -- 32.8%
<S> <C> <C> <C>
UNITED KINGDOM-10.4%
United Kingdom Gilts:
GBP 152,000 6.500% due 12/07/2003........................................................... 261,387
GBP 280,000 0.000% due 12/07/2005........................................................... 301,903
GBP 145,000 8.500% due 12/07/2005........................................................... 280,261
GBP 30,000 7.250% due 12/07/2007........................................................... 55,326
GBP 130,000 9.000% due 08/06/2012........................................................... 282,459
-----------
1,181,336
-----------
</TABLE>
See Notes to Financial Statements.
3
<PAGE>
BJB INVESTMENT FUNDS
BJB GLOBAL INCOME FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
FACE VALUE
CURRENCY VALUE (NOTE 1)
- --------- ------------- -----------
FOREIGN GOVERNMENT BONDS -- CONTINUED
<S> <C> <C> <C>
GERMANY-7.2%
Deutschland Republic,
DEM 1,291,000 6.500% due 07/04/2027........................................................... $ 819,163
-----------
ITALY-4.7%
Government of Italy:
ITL 330,000,000 5.750% due 09/15/2002........................................................... 192,789
USD 340,000 6.875% due 09/27/2023........................................................... 359,720
-----------
552,509
-----------
SWEDEN-3.9%
Kingdom of Sweden:
SEK 1,000,000 13.000% due 06/15/2001.......................................................... 158,099
SEK 2,100,000 6.500% due 10/25/2006........................................................... 292,150
-----------
450,249
-----------
FINLAND-3.4%
Republic of Finland,
USD 350,000 7.875% due 07/28/2004........................................................... 384,125
-----------
DENMARK-2.1%
Kingdom of Denmark:
DKK 750,000 7.000% due 11/10/2024........................................................... 128,536
DKK 690,000 7.000% due 12/15/2004........................................................... 111,578
-----------
240,114
-----------
BELGIUM-1.1%
Belgium Kingdom,
USD 100,000 9.200% due 06/28/2010........................................................... 124,600
-----------
TOTAL FOREIGN GOVERNMENT BONDS (COST $3,648,571).................................. 3,752,096
-----------
<CAPTION>
CORPORATE BONDS -- 7.4%
<S> <C> <C> <C>
UNITED STATES-3.8%
General Electric Capital Corporation,
USD 370,000 8.625% due 06/15/2008........................................................... 432,715
-----------
</TABLE>
See Notes to Financial Statements.
4
<PAGE>
BJB INVESTMENT FUNDS
BJB GLOBAL INCOME FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
FACE VALUE
CURRENCY VALUE (NOTE 1)
- --------- ------------- -----------
CORPORATE BONDS -- CONTINUED
<S> <C> <C> <C>
UNITED KINGDOM--1.7%
Puma Finance,
USD 200,000 5.911% due 10/27/2029........................................................... $ 200,000
-----------
GERMANY-1.0%
KFW International Finance,
DEM 200,000 5.000% due 01/04/2009........................................................... 110,366
-----------
JAPAN-0.9%
Tohoku Electric Power Co.,
USD 100,000 6.500% due 10/30/2002........................................................... 100,600
-----------
TOTAL CORPORATE DEBT (COST $815,371).............................................. 843,681
-----------
<CAPTION>
ASSET-BACKED SECURITIES -- 0.8%
<S> <C> <C> <C>
UNITED STATES-0.8%
Toyota Auto Receivables Grantor Trust Series 1996-A,
USD 95,867 6.300% due 07/20/2001 (Cost $95,864)............................................ 96,151
-----------
<CAPTION>
REPURCHASE AGREEMENTS -- 3.5%
<S> <C> <C> <C>
USD 400,637 UNITED STATES-3.5%
Investors Bank & Trust Company Repurchase Agreement dated 4/30/1998, due
5/01/1998, with a maturity value of $400,693 and an effective yield of 5.060%,
collateralized by a Government National Mortgage Association Obligation, with a
rate of 7.000%, a maturity date of 8/20/2025, and a market value of $420,910 (at
amortized cost)................................................................... 400,637
-----------
TOTAL INVESTMENTS -- 98.1% (COST $11,212,241)..................................... 11,236,396
OTHER ASSETS AND LIABILITIES (NET) -- 1.9%........................................ 212,208
-----------
NET ASSETS -- 100.0%.............................................................. $11,448,604
-----------
-----------
</TABLE>
See Notes to Financial Statements.
5
<PAGE>
BJB INVESTMENT FUNDS
BJB GLOBAL INCOME FUND
SCHEDULE OF FORWARD FOREIGN EXCHANGE CONTRACTS
APRIL 30, 1998 (UNAUDITED)
FORWARD FOREIGN EXCHANGE CONTRACTS TO BUY
<TABLE>
<CAPTION>
CONTRACTS TO RECEIVE
---------------------------------
EXPIRATION LOCAL VALUE IN IN EXCHANGE NET UNREALIZED
DATE CURRENCY USD FOR USD (DEPRECIATION)
- ---------- -------------------- -------- ----------- --------------
<S> <C> <C> <C> <C>
5/21/98 GBP 290,000 484,368 487,086 $ (2,718)
--------------
Net unrealized depreciation on forward foreign
exchange contracts............................... $ (2,718)
--------------
--------------
</TABLE>
FORWARD FOREIGN EXCHANGE CONTRACTS TO SELL
<TABLE>
<CAPTION>
CONTRACTS TO DELIVER
--------------------------------- NET UNREALIZED
EXPIRATION LOCAL VALUE IN IN EXCHANGE APPRECIATION
DATE CURRENCY USD FOR USD (DEPRECIATION)
- ---------- -------------------- -------- ----------- --------------
<S> <C> <C> <C> <C>
5/20/98 SEK 1,790,000 231,104 230,581 $ (523)
5/27/98 DEM 512,000 285,541 286,034 493
--------------
Net unrealized depreciation on forward foreign
exchange contracts............................... $ (30)
--------------
--------------
</TABLE>
<TABLE>
<CAPTION>
GLOSSARY OF CURRENCIES
<S> <C> <C> <C> <C> <C>
DEM -- German Deutsche Mark ITL -- Italian Lira
DKK -- Danish Krone SEK -- Swedish Krona
GBP -- British Pound Sterling USD -- United States Dollar
</TABLE>
See Notes to Financial Statements.
6
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
COMMON STOCKS -- 94.0%
UNITED KINGDOM-12.7%
ARM Holdings Plc ADR *.............................................................. 15,940 $ 643,578
British Aerospace Plc............................................................... 16,074 536,977
British Airport Authority Plc....................................................... 176 1,807
British Petroleum Co Plc............................................................ 30,232 477,678
British Telecommunications Plc...................................................... 38,089 413,633
Colt Telecom Group Plc *............................................................ 2,500 215,313
General Electric Plc................................................................ 58,000 476,879
Glaxo Wellcome Plc.................................................................. 14,384 407,408
Granada Group Plc................................................................... 7,161 123,324
Hays Plc............................................................................ 16,500 282,777
HSBC Holdings Plc................................................................... 48 1,494
Ladbroke Group...................................................................... 23,594 129,788
Misys Plc........................................................................... 9,482 435,982
National Westminster Bank Plc....................................................... 35,900 714,463
Pearson Plc......................................................................... 23,750 372,480
Royal & Sun Alliance Insurance Group................................................ 28,526 316,817
Siebe Plc........................................................................... 19,193 436,433
Smithkline Beecham Plc.............................................................. 30,000 358,142
Tesco Plc........................................................................... 35,820 337,187
Unilever Plc........................................................................ 39,388 419,507
Virgin Express Holdings Plc ADR *................................................... 17,100 384,750
Vodafone Group Plc.................................................................. 79,200 869,684
-----------
8,356,101
-----------
FRANCE-9.6%
Accor SA............................................................................ 1,931 525,689
Alcatel Alsthom..................................................................... 2,415 447,259
Axa-UAP............................................................................. 7,300 856,042
Banque National De Paris............................................................ 7,558 636,476
Cap Gemini SA (a)................................................................... 3,865 501,381
Coflexip SA......................................................................... 2,400 340,038
Compagnie Generale des Eaux......................................................... 2,141 397,581
Credit Commercial de France......................................................... 6,300 502,284
Dassault Aviation SA................................................................ 800 241,840
Dassault Systemes................................................................... 11,000 431,193
Elf-Aquitaine SA.................................................................... 3,700 484,893
</TABLE>
See Notes to Financial Statements.
7
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
COMMON STOCKS -- CONTINUED
FRANCE -- CONTINUED
L'Oreal............................................................................. 1 $ 477
Rhone Polenc........................................................................ 10,076 492,210
Total SA-Class B.................................................................... 3,752 445,591
-----------
6,302,954
-----------
GERMANY-8.8%
Adidas.............................................................................. 2,250 372,734
Bayer AG............................................................................ 9,100 404,366
Bayerische Motoren Werke AG......................................................... 400 441,017
BHF-Bank AG......................................................................... 15,500 630,927
Deutsche Bank AG.................................................................... 5,800 446,017
Deutsche Pfandbrief & Hypob......................................................... 6,400 493,582
Kamps AG *.......................................................................... 10,000 281,204
Mannesmann AG....................................................................... 885 701,751
MobilCom AG......................................................................... 1,000 740,596
SAP AG.............................................................................. 1,240 586,909
Volkswagen AG....................................................................... 885 704,215
-----------
5,803,318
-----------
NETHERLANDS-7.5%
Akzo Nobel.......................................................................... 1,440 292,715
Baan Company NV *................................................................... 10,000 437,707
Benckiser NV *...................................................................... 15,180 885,168
De Boer Unigro NV................................................................... 11,300 553,291
Heineken NV......................................................................... 1,900 440,348
ING Groep NV........................................................................ 10,617 689,457
KLM Royal Dutch Airlines NV......................................................... 11,002 432,048
Koninklijke Ahold NV................................................................ 218 6,793
Philips Electronics NV.............................................................. 7,580 667,313
Unique International NV............................................................. 17,000 540,630
Wolters Kluwer NV *................................................................. 9 1,176
-----------
4,946,646
-----------
GREECE-6.8%
Alpha Credit Bank................................................................... 6,500 685,739
Commercial Bank of Greece SA........................................................ 7,000 440,451
</TABLE>
See Notes to Financial Statements.
8
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
COMMON STOCKS -- CONTINUED
GREECE -- CONTINUED
Ergo Bank SA........................................................................ 5,500 $ 518,009
Hellenic Duty Free Shops SA *....................................................... 28,000 434,326
Hellenic Telecommunication Organization SA.......................................... 13,600 389,462
Ionian Bank SA *.................................................................... 7,200 291,959
Minoan Lines *...................................................................... 3,900 38,469
National Bank of Greece *........................................................... 8,003 1,408,190
Titan Cement Company................................................................ 3,560 304,709
-----------
4,511,314
-----------
SWITZERLAND-5.9%
Adecco SA........................................................................... 650 283,173
Ares-Serono Group Class B........................................................... 100 143,000
CS Holdings (Registered)............................................................ 2,056 451,267
Nestle SA (Registered).............................................................. 283 547,742
Novartis AG (Bearer)................................................................ 75 124,110
Novartis AG (Registered)............................................................ 330 544,330
Roche Holdings AG................................................................... 210 350,931
Schindler Holding AG................................................................ 135 217,742
Schweizerische Rueckversicherungs-Gesellschaft (Registered)......................... 178 391,872
Swissair (Registered)............................................................... 162 211,403
Zurich Versicherungs (Registered)................................................... 1,080 656,548
-----------
3,922,118
-----------
ITALY-5.5%
Banca Intesa SPA.................................................................... 82,000 460,227
Banca Populare di Brescia (a)....................................................... 34,000 520,662
Credito Italiano.................................................................... 90,000 470,660
Istituto Nazionale delle Assicurazioni.............................................. 170,000 506,644
Mediolanum SPA...................................................................... 18,500 556,690
Telecom Italia Mobile............................................................... 91,000 520,851
Telecom Italia SPA.................................................................. 80,000 602,143
-----------
3,637,877
-----------
FINLAND-4.9%
Cultor Oyj.......................................................................... 6,640 392,409
Hartwall Oy AB...................................................................... 22,585 700,522
</TABLE>
See Notes to Financial Statements.
9
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
COMMON STOCKS -- CONTINUED
FINLAND -- CONTINUED
Merita Ltd Class A.................................................................. 70,980 $ 475,493
Pohjola Insurance Group Class B..................................................... 9,750 545,782
Raision Tehtaat Oy.................................................................. 3,310 607,496
Rauma Oy............................................................................ 167 3,126
Tt Tieto Oy Class B................................................................. 2,815 490,814
-----------
3,215,642
-----------
SWEDEN-4.5%
Biora AB * (a)...................................................................... 39,000 586,243
Ericsson AB Class B................................................................. 6,960 366,401
Incentive AB Class A (a)............................................................ 4,000 387,087
Lindex AB........................................................................... 10,500 399,667
Mandamus AB *....................................................................... 625 1,077
Nordbanken Holding AB............................................................... 63,650 468,123
Sparbanken Sverige.................................................................. 12,500 390,313
Stora Kopparbergs Bergslags Aktiebolag Class A...................................... 23,500 401,764
-----------
3,000,675
-----------
PORTUGAL-4.5%
Banco Espirito Santo (Registered)................................................... 12,175 581,966
BPI-SGPS SA (Registered)............................................................ 10,300 478,354
Brisa-Auto Estradas de Portugal SA (a).............................................. 4,000 177,078
Espirito Santo Financial Group ADR.................................................. 16,000 413,000
Jeronimo Martins.................................................................... 8,247 385,248
Portugal Telecom *.................................................................. 8,160 438,140
Semapa Soc Inv E Gestao-Sgps........................................................ 18,000 526,018
-----------
2,999,804
-----------
JAPAN-3.9%
Canon Sales Co. Inc................................................................. 400 5,329
Circle K Japan Co Ltd............................................................... 66 2,708
Fuji Photo Film..................................................................... 5,000 177,268
Fuji Soft ABC Inc................................................................... 7,000 248,175
Fujitsu Ltd......................................................................... 500 5,815
Nippon Telegraph & Telephone Corporation............................................ 16 139,706
Nippon Telegraph & Telephone Corporation ADR........................................ 5,375 233,813
</TABLE>
See Notes to Financial Statements.
10
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
COMMON STOCKS -- CONTINUED
JAPAN -- CONTINUED
NTT Data Corp....................................................................... 400 $ 172,224
Promise Co Ltd...................................................................... 4,830 244,318
Sakura Bank Ltd..................................................................... 70,000 239,744
Sankyo Co Ltd....................................................................... 10,000 246,895
Sony Corp........................................................................... 5,400 447,527
The Bank of Tokyo-Mitsubishi Ltd.................................................... 20,000 246,744
The Sanwa Bank Ltd.................................................................. 22,000 193,752
-----------
2,604,018
-----------
CANADA-3.1%
Bank of Nova Scotia................................................................. 13,200 362,706
Barrick Gold Corp................................................................... 3,000 67,125
BCE Inc............................................................................. 11,080 470,208
Canadian Imperial Bank of Commerce.................................................. 10,100 358,381
Potash Corporation of Saskatchewan Inc.............................................. 4,500 402,188
Royal Bank of Canada................................................................ 6,740 402,444
-----------
2,063,052
-----------
SPAIN-2.0%
Banco Popular Espanol SA............................................................ 6,466 530,452
Corporacion Bancaria de Espana SA................................................... 2,500 208,374
Telefonica de Espana................................................................ 13,560 566,001
-----------
1,304,827
-----------
IRELAND-1.9%
Bank of Ireland..................................................................... 27,875 566,833
Elan Corp Plc *..................................................................... 4,150 258,078
Irish Life Plc...................................................................... 26,000 243,008
Ryanair Holdings Plc *.............................................................. 5,000 191,875
-----------
1,259,794
-----------
NORWAY-1.6%
Christiania Bank Og Kreditkasse..................................................... 120,900 555,456
Den Norske Bank ASA................................................................. 101,950 535,307
-----------
1,090,763
-----------
</TABLE>
See Notes to Financial Statements.
11
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
COMMON STOCKS -- CONTINUED
UNITED STATES-1.5%
Global TeleSystems Group Inc *...................................................... 21,800 $ 1,021,875
-----------
AUSTRALIA-1.5%
Australia & New Zealand Bank Group.................................................. 49,434 344,201
Sydney Harbor Casino Ltd *.......................................................... 60,000 42,546
Telstra Corporation Limited-Installment Receipts.................................... 143,500 336,074
The News Corporation Ltd............................................................ 43,274 289,402
-----------
1,012,223
-----------
TURKEY-1.1%
Akbank TAS.......................................................................... 1,077,000 91,545
Haci Omer Sabanci Holding AS *...................................................... 1,376,000 100,448
Kazkommertsbank Co GDR *............................................................ 6,659 181,458
Koc Holding AS...................................................................... 434,000 92,008
Migros Turk TAS..................................................................... 97,000 95,060
Turkiye Garanti Bankasi AS.......................................................... 1,738,000 92,114
Yapi Ve Kredi Bankasi............................................................... 2,022,000 99,078
-----------
751,711
-----------
BELGIUM-0.9%
Algemene Maatschappij voor Nijverheidskredit NV..................................... 8,790 584,574
-----------
HONG KONG-0.9%
China Everbright Ltd................................................................ 210,000 142,295
China Telecom (Hong Kong) Ltd *..................................................... 62,000 117,630
HSBC Holdings Plc................................................................... 8,078 230,413
Hutchison Whampoa................................................................... 15,000 92,734
-----------
583,072
-----------
RUSSIA-0.8%
Lukoil Oil Co ADR................................................................... 5,530 366,363
Vimpel Communications............................................................... 3,000 160,068
-----------
526,431
-----------
DENMARK-0.7%
Tele Danmark SA Class B............................................................. 5,700 478,422
-----------
</TABLE>
See Notes to Financial Statements.
12
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
COMMON STOCKS -- CONTINUED
AUSTRIA-0.6%
Oemv AG............................................................................. 2,320 $ 344,030
Scala Business Solutions *.......................................................... 3,330 40,843
-----------
384,873
-----------
HUNGARY-0.5%
Magyar Tavkozlesi Rt ADR *.......................................................... 8,980 264,349
Mol Magyar Olaj-Es Gazipari......................................................... 1,950 59,227
-----------
323,576
-----------
INDONESIA-0.4%
Pt Gudang Garam-Foreign............................................................. 66,000 77,815
Pt Indofood Sukses Makmur........................................................... 262,500 110,185
Pt Kalbe Farma...................................................................... 600,000 61,111
-----------
249,111
-----------
MALAYSIA-0.3%
Amway (Malaysia) Holdings Berhad.................................................... 29,000 57,221
Arab-Malaysian Merchant Bank........................................................ 8,000 8,118
Kentucky Fried Chicken Berhad....................................................... 35,000 55,436
Petronas Gas Berhad................................................................. 18,000 43,490
Rothmans of Pall Mall (Malaysia) Berhad............................................. 5,400 44,577
-----------
208,842
-----------
THAILAND-0.3%
Bangkok Bank Public Company Ltd-Foreign (Registered)................................ 27,800 69,770
Siam Commercial Bank (Foreign Shares)............................................... 51,800 61,651
Thai Farmers Bank Public Company Ltd-Foreign........................................ 33,000 75,563
-----------
206,984
-----------
PHILIPPINES-0.3%
Philippine Long Distance Telephone Company.......................................... 4,000 107,098
San Miguel Corporation Class B (ORD)................................................ 53,150 87,370
-----------
194,468
-----------
</TABLE>
See Notes to Financial Statements.
13
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
COMMON STOCKS -- CONTINUED
SOUTH AFRICA-0.2%
Barlow Limited...................................................................... 3,296 $ 31,855
Nedcor Ltd.......................................................................... 2,928 83,417
South African Breweries Ltd......................................................... 1,343 45,063
-----------
160,335
-----------
POLAND-0.2%
Bank Rozwoju Eksportu SA............................................................ 1,300 37,318
Electrim SA......................................................................... 5,000 71,397
Gorazdze............................................................................ 800 22,140
Mostostal-Export SA................................................................. 10,558 24,557
-----------
155,412
-----------
MEXICO-0.2%
Grupo Posadas SA Class L *.......................................................... 180,000 130,123
-----------
MAURITIUS-0.2%
New Mauritius Hotels Ltd............................................................ 23,500 53,161
State Bank of Mauritius Ltd......................................................... 72,000 49,319
-----------
102,480
-----------
NEW ZEALAND-0.1%
Lion Nathan......................................................................... 27,000 71,596
Sky Network Television Ltd *........................................................ 1,000 15,000
-----------
86,596
-----------
CHILE-0.1%
Vina Concha Y Toro.................................................................. 2,500 81,250
-----------
SOUTH KOREA-0.0%
Korea Electric Power Corp........................................................... 2,500 23,281
-----------
PERU-0.0%
Cementos Lima SA-Trabajo............................................................ 1 2
-----------
TOTAL COMMON STOCKS (COST $45,593,514).............................................. 62,284,544
-----------
</TABLE>
See Notes to Financial Statements.
14
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
RIGHTS & WARRANTS-0.2%
HUNGARY-0.2%
Egis Rights *....................................................................... 780 $ 40,655
Pick Szeged Rights *................................................................ 526 32,401
-----------
73,056
-----------
FRANCE-0.0%
Cap Gemini SA Rights *.............................................................. 3,861 9,940
Compagnie Generale des Eaux Warrants, expire 5/02/2001 *............................ 2,110 3,067
-----------
13,007
-----------
AUSTRIA-0.0%
Scala Business Solution Warrants, expire 3/31/1999 *................................ 1,387 6,585
Scala Business Solution Warrants, expire 3/31/2001 *................................ 1,387 4,610
-----------
11,195
-----------
SPAIN-0.0%
Telefonica SA Rights *.............................................................. 13,560 10,679
-----------
BRAZIL-0.0%
Brahma Warrants, expire 4/30/2003 *................................................. 9,993 612
-----------
SWITZERLAND-0.0%
Roche Holdings Warrants, expire 5/05/1998 *......................................... 5 576
-----------
THAILAND-0.0%
Siam Commercial Bank Public Company Ltd Warrants, expire 12/31/2002*................ 2,100 0
-----------
TOTAL RIGHTS & WARRANTS (COST $49,379).............................................. 109,125
-----------
</TABLE>
See Notes to Financial Statements.
15
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS -- (CONTINUED)
APRIL 30, 1998 (UNAUDITED)
(PERCENTAGE OF NET ASSETS)
<TABLE>
<CAPTION>
MARKET
SHARE VALUE
DESCRIPTION AMOUNT (NOTE 1)
- ------------------------------------------------------------------------------------ ---------- -----------
<S> <C> <C>
INVESTMENT FUNDS-0.2%
POLAND-0.1%
Polish National Investment Fund *................................................... 1,500 $ 49,683
-----------
MULTI-NATIONAL-0.1%
Morgan Stanley Africa Investment Fund Inc........................................... 3,100 44,950
-----------
TOTAL INVESTMENT FUNDS (COST $114,977).............................................. 94,633
-----------
<CAPTION>
FACE
VALUE
----------
<S> <C> <C> <C>
CORPORATE DEBT-0.0%
PORTUGAL-0.0%
Jeronimo Martins 0.000% due 12/30/2004 (Cost $15,535)....................... PTE 2,879,000 15,638
-----------
TOTAL INVESTMENTS-94.4% (COST $45,773,405).................................. 62,503,940
OTHER ASSETS AND LIABILITIES (NET)-5.6%..................................... 3,722,152
-----------
TOTAL NET ASSETS-100.0%..................................................... $66,226,092
-----------
-----------
</TABLE>
PORTFOLIO FOOTNOTES:
ADR American Depositary Receipt
ORD Ordinary Shares
GDR Global Depositary Receipt
* Non-income producing security
(a) Securities that may be resold to 'qualified institutional buyers' under
Rule 144A or securities offered pursuant to Section 4 (2) of the
Securities Act of 1933, as amended. These securities have been
determined to be liquid under guidelines established by the Board of
Trustees.
See Notes to Financial Statements.
16
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
SCHEDULE OF FORWARD FOREIGN EXCHANGE CONTRACTS
APRIL 30, 1998 (UNAUDITED)
FORWARD FOREIGN EXCHANGE CONTRACTS TO BUY
<TABLE>
<CAPTION>
CONTRACTS TO RECEIVE
---------------------------------- NET UNREALIZED
EXPIRATION LOCAL VALUE IN IN EXCHANGE APPRECIATION
DATE CURRENCY USD FOR USD (DEPRECIATION)
- ---------- --------------------- --------- ----------- --------------
<S> <C> <C> <C> <C>
5/04/98 DEM 753,339 419,584 419,828 $ (244)
5/04/98 FRF 18,359,100 3,050,149 3,049,380 769
--------------
Net unrealized appreciation on forward foreign
exchange contracts................................. $ 525
--------------
--------------
</TABLE>
FORWARD FOREIGN EXCHANGE CONTRACTS TO SELL
<TABLE>
<CAPTION>
CONTRACTS TO DELIVER
------------------------------------- NET UNREALIZED
EXPIRATION LOCAL VALUE IN IN EXCHANGE APPRECIATION
DATE CURRENCY USD FOR USD (DEPRECIATION)
- ---------- ------------------------ --------- ----------- --------------
<S> <C> <C> <C> <C>
5/04/98 CHF 504,995 336,039 337,789 $ 1,750
5/04/98 ESP 64,784,971 425,239 425,070 (169)
5/04/98 FRF 18,359,100 3,050,149 3,000,000 (50,149)
5/04/98 GRD 302,142,681 960,675 954,064 (6,611)
5/04/98 NLG 546,710 270,458 270,555 97
5/04/98 SEK 4,130,532 533,024 532,217 (807)
5/06/98 ITL 465,823,360 262,745 262,443 (302)
5/06/98 GBP 386,215 645,557 644,786 (771)
5/08/98 DEM 5,161,410 2,875,387 2,810,919 (64,468)
5/08/98 GBP 953,305 1,593,285 1,586,299 (6,986)
5/20/98 SEK 7,930,200 1,023,855 1,025,899 2,044
5/26/98 CHF 2,952,430 1,969,791 1,994,794 25,003
5/26/98 FRF 30,668,007 5,101,737 5,097,904 (3,833)
5/26/98 NLG 4,102,100 2,031,978 2,035,726 3,748
5/29/98 FRF 3,961,034 659,049 658,701 (348)
7/06/98 ITL 3,549,500,000 2,004,104 2,000,000 (4,104)
--------------
Net unrealized depreciation on forward foreign exchange
contracts.......................................................... $ (105,906)
--------------
--------------
</TABLE>
<TABLE>
<CAPTION>
GLOSSARY OF CURRENCIES
<S> <C> <C> <C> <C> <C>
CHF -- Swiss Franc GRD -- Greek Drachma
DEM -- German Deutsche Mark ITL -- Italian Lira
ESP -- Spanish Peseta NLG -- Netherlands Guilder
FRF -- French Franc PTE -- Portuguese Escudo
GBP -- British Pound Sterling SEK -- Swedish Krona
</TABLE>
See Notes to Financial Statements.
17
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS--INDUSTRY SECTOR (UNAUDITED)
APRIL 30, 1998
(PERCENTAGE OF NET ASSETS)
At April 30, 1998, sector diversification of the Fund's investments was as
follows:
<TABLE>
<CAPTION>
MARKET
% OF NET VALUE
ASSETS (NOTE 1)
---------- -----------
<S> <C> <C>
INDUSTRY SECTOR:
Banking...................................................................................... 26.0% $17,193,758*
Telephone Systems............................................................................ 8.4 5,561,161
Beverages, Food and Tobacco.................................................................. 6.6 4,387,574
Insurance.................................................................................... 6.2 4,073,403
Computer Software and Processing............................................................. 5.1 3,366,363
Communications............................................................................... 5.1 3,348,244
Oil and Gas.................................................................................. 3.8 2,509,995
Pharmaceuticals.............................................................................. 2.6 1,723,479
Chemicals.................................................................................... 2.6 1,704,835
Financial Services........................................................................... 2.5 1,671,270
Building Materials........................................................................... 2.4 1,564,335
Retailers.................................................................................... 2.2 1,482,795
Transportation............................................................................... 1.8 1,207,574
Electronics.................................................................................. 1.8 1,162,502
Automotive................................................................................... 1.7 1,145,232
Commercial Services.......................................................................... 1.7 1,139,102
Airlines..................................................................................... 1.6 1,008,673
Food Retailers............................................................................... 1.5 1,001,176
Industrial--Diversified...................................................................... 1.4 959,041
Cosmetics and Personal Care.................................................................. 1.4 885,645
Heavy Machinery.............................................................................. 1.3 885,055
Other........................................................................................ 6.8 4,522,728
---------- -----------
TOTAL INVESTMENTS.............................................................................. 94.4 62,503,940
OTHER ASSETS AND LIABILITIES (NET)............................................................. 5.6 3,722,152
---------- -----------
NET ASSETS..................................................................................... 100.0% $66,226,092
---------- -----------
---------- -----------
</TABLE>
- ------------------
* The Fund's investment in the Banking industry was subsequently brought below
25%.
See Notes to Financial Statements.
18
<PAGE>
BJB INVESTMENT FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
BJB BJB
GLOBAL INCOME INTERNATIONAL EQUITY
FUND FUND
------------- --------------------
<S> <C> <C>
ASSETS:
Investments in securities, at value (Cost $10,811,604 and $45,773,405,
respectively).................................................................... $10,835,759 $ 62,503,940
Repurchase agreements, at amortized cost............................................ 400,637 --
Cash and foreign currency, at value (Cost $35,613 and $0, respectively)............. 33,421 --
Receivables:
Investments sold................................................................. -- 4,847,622
Fund shares sold................................................................. -- 220,000
Interest and dividends........................................................... 246,362 187,396
Tax reclaim...................................................................... -- 55,082
Unrealized appreciation on forward foreign exchange contracts.................... 493 33,411
Other Assets:
Unamortized organization costs (Note 6).......................................... -- 1,433
Prepaid expense.................................................................. 1,027 3,305
------------- --------------------
Total Assets..................................................................... 11,517,699 67,852,189
------------- --------------------
LIABILITIES:
Payables:
Investments purchased............................................................ -- 1,290,727
Investment advisory fee payable (Note 2)......................................... 17,828 71,508
Custody and administration fee payable........................................... 13,988 27,607
Unrealized depreciation on forward foreign exchange contracts.................... 3,241 138,792
Distribution and shareholder servicing fees payable (Note 3)..................... 6,781 35,423
Accrued expenses and other payables.............................................. 27,257 62,040
------------- --------------------
Total Liabilities................................................................ 69,095 1,626,097
------------- --------------------
NET ASSETS............................................................................ $11,448,604 $ 66,226,092
------------- --------------------
------------- --------------------
NET ASSETS CONSIST OF:
Par value........................................................................... $ 980 $ 3,824
Paid in capital in excess of par value.............................................. 12,254,890 51,497,174
Undistributed net investment income (Distributions in excess of income)............. (73,741) 68,884
Accumulated net realized loss on investments sold, forward foreign exchange
contracts and foreign currency transactions...................................... (733,066) (1,860,232)
Net unrealized appreciation (depreciation) on investments, forward foreign exchange
contracts and foreign currency related transactions.............................. (459) 16,516,442
------------- --------------------
NET ASSETS............................................................................ $11,448,604 $ 66,226,092
------------- --------------------
------------- --------------------
SHARES OUTSTANDING.................................................................... 979,724 3,823,836
------------- --------------------
------------- --------------------
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE........................................ $ 11.69 $ 17.32
------------- --------------------
------------- --------------------
</TABLE>
See Notes to Financial Statements.
19
<PAGE>
BJB INVESTMENT FUNDS
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
BJB BJB
GLOBAL INCOME INTERNATIONAL EQUITY
FUND FUND
------------- --------------------
<S> <C> <C>
INVESTMENT INCOME (LOSS):
Interest............................................................................ $ 347,191 $ 61,162
Dividends+.......................................................................... -- 356,121
------------- --------------------
347,191 417,283
EXPENSES:
Investment advisory fee (Note 2).................................................... 36,501 255,046
Custody and administration fees..................................................... 19,912 108,759
Distribution and shareholder servicing fees (Note 3)................................ 14,039 63,761
Transfer agent fees................................................................. 9,321 10,486
Professional fees................................................................... 9,030 25,767
Amortization of organization costs (Note 6)......................................... -- 2,753
Trustees' fees and expenses (Note 2)................................................ 6,024 6,031
Insurance premium expense........................................................... 3,097 9,754
Shareholder reports................................................................. 3,844 15,947
Registration and filing fees........................................................ 3,998 9,077
Miscellaneous fees.................................................................. 579 637
------------- --------------------
Total gross expenses............................................................. 106,345 508,018
Less: Fees waived by investment adviser (Note 2)................................. -- (127,523)
------------- --------------------
Net Expenses..................................................................... 106,345 380,495
------------- --------------------
NET INVESTMENT INCOME................................................................. 240,846 36,788
------------- --------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS (NOTES 1 AND 4):
Realized gain (loss) on:
Security transactions............................................................ 198,192 2,049,206
Forward foreign exchange contracts............................................... 68,290 401,650
Foreign currency transactions.................................................... 6,319 (63,499)
------------- --------------------
Net realized gain on investments............................................... 272,801 2,387,357
------------- --------------------
Net change in unrealized appreciation (depreciation) on:
Securities....................................................................... (166,116) 11,937,969
Forward foreign exchange contracts............................................... (29,023) (63,854)
Currencies and net other assets.................................................. (46,069) (47,435)
------------- --------------------
Net change in unrealized appreciation (depreciation) of investments............ (241,208) 11,826,680
------------- --------------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS....................................... 31,593 14,214,037
------------- --------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................................. $ 272,439 $ 14,250,825
------------- --------------------
------------- --------------------
</TABLE>
- ------------------
+ Net of foreign withholding taxes of $55,703 for the International Equity Fund.
See Notes to Financial Statements.
20
<PAGE>
BJB INVESTMENT FUNDS
BJB GLOBAL INCOME FUND
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED FOR THE YEAR
APRIL 30, 1998 ENDED
(UNAUDITED) OCTOBER 31, 1997
-------------- ----------------
<S> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income................................................................... $ 240,846 $ 608,753
Net realized gain (loss) on investments................................................. 272,801 (75,438)
Net change in unrealized appreciation (depreciation) of investments..................... (241,208) (148,834)
-------------- ----------------
Net increase in net assets resulting from operations.................................... 272,439 384,481
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 1):
Dividends from net investment income.................................................. (288,312) (700,402)
Distributions from capital............................................................ -- (114,208)
FUND SHARE TRANSACTIONS:
Net decrease from Fund share transactions (Note 5).................................... (424,878) (2,264,748)
-------------- ----------------
Net decrease in net assets............................................................ (440,751) (2,694,877)
NET ASSETS:
Beginning of period..................................................................... 11,889,355 14,584,232
-------------- ----------------
End of period (including distributions in excess of net investment income of $73,741 and
$26,275 respectively)................................................................. $ 11,448,604 $ 11,889,355
-------------- ----------------
-------------- ----------------
</TABLE>
See Notes to Financial Statements.
21
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED FOR THE YEAR
APRIL 30, 1998 ENDED
(UNAUDITED) OCTOBER 31, 1997
-------------- ----------------
<S> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income (loss)............................................................ $ 36,788 $ (848)
Net realized gain on investments........................................................ 2,387,357 917,721
Net change in unrealized appreciation (depreciation) of investments..................... 11,826,680 3,392,380
-------------- ----------------
Net increase in net assets resulting from operations.................................... 14,250,825 4,309,253
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 1):
Dividends from net investment income.................................................... (501,882) (67,184)
FUND SHARE TRANSACTIONS:
Net increase from Fund share transactions (Note 5).................................... 8,175,412 20,898,481
-------------- ----------------
Net increase in net assets............................................................ 21,924,355 25,140,550
NET ASSETS:
Beginning of period..................................................................... 44,301,737 19,161,187
-------------- ----------------
End of period (including undistributed net investment income of $68,884 and $533,978
respectively)......................................................................... $ 66,226,092 $ 44,301,737
-------------- ----------------
-------------- ----------------
</TABLE>
See Notes to Financial Statements.
22
<PAGE>
BJB INVESTMENT FUNDS
BJB GLOBAL INCOME FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
APRIL 30, 1998 ----------------------------------------------------------
(UNAUDITED) 10/31/97 10/31/96 10/31/95# 10/31/94# 10/31/93
-------------- -------- -------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period................. $ 11.70 $ 12.01 $ 12.11 $ 11.16 $ 12.28 $ 12.36
-------------- -------- -------- --------- --------- --------
Income (Loss) from investment operations:
Net investment income 0.25 0.50 0.59 0.59 0.39 0.37
Net realized and unrealized gain (loss) on
investments..................................... 0.04 (0.13) 0.36 0.92 (0.81) 0.58
-------------- -------- -------- --------- --------- --------
Total income (loss) from investment
operations.................................... 0.29 0.37 0.95 1.51 (0.42) 0.95
-------------- -------- -------- --------- --------- --------
Less Distributions:
Dividends from net investment income............... (0.30) (0.58) (1.05) (0.56) (0.27) (0.37)
Distributions from net realized gains.............. -- -- -- -- -- (0.66)
Distributions from capital (Note 1)................ -- (0.10) -- -- (0.43) --
-------------- -------- -------- --------- --------- --------
Total distributions............................. (0.30) (0.68) (1.05) (0.56) (0.70) (1.03)
-------------- -------- -------- --------- --------- --------
Net Asset Value, end of period....................... $ 11.69 $ 11.70 $ 12.01 $ 12.11 $ 11.16 $ 12.28
-------------- -------- -------- --------- --------- --------
-------------- -------- -------- --------- --------- --------
Total Return **...................................... 2.51% 3.24% 8.25% 13.90% (3.54)% 8.15%
-------------- -------- -------- --------- --------- --------
-------------- -------- -------- --------- --------- --------
Ratios/Supplemental Data:
Net assets, end of period (in 000's)................. $ 11,449 $ 11,889 $ 14,584 $17,327 $28,619 $ 57,682
Ratio of net investment income to average net
assets............................................. 4.29%+ 4.32% 4.71% 5.19% 3.29% 2.24%
Ratio of total expenses to average net assets........ 1.89%+ 1.99% 2.53%## 2.15%## 1.66% 1.78%
Portfolio turnover rate.............................. 88% 162% 219% 319% 320% 291%
</TABLE>
- ------------------
** Total return represents aggregate total return for the periods indicated and
does not reflect any applicable sales charge.
+ Annualized.
# Per share amounts have been calculated using the monthly average share
method, which more appropriately presents the per share data for the period
since the use of the undistributed income method does not accord with results
of operations.
## Includes indirectly paid expenses. Excluding indirectly paid expenses the
ratio of total expenses to average net assets would have been 2.43% and 2.05%
for the years ended October 31, 1996 and 1995, respectively.
See Notes to Financial Statements.
23
<PAGE>
BJB INVESTMENT FUNDS
BJB INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED PERIOD
APRIL 30, 1998 -------------------------------------------------- ENDED
(UNAUDITED) 10/31/97# 10/31/96 10/31/95# 10/31/94 10/31/93*
---------------- --------- -------- --------- -------- -------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period...... $ 13.41 $ 11.43 $ 10.13 $ 11.30 $ 13.10 $ 12.00
---------------- --------- -------- --------- -------- -------
Income from investment operations:
Net investment income (expense)++....... 0.01 0.00 (0.02) (0.06) (0.21) (0.02)
Net realized and unrealized gain (loss)
on investments....................... 4.05 2.02 1.32 (1.11) (1.56) 1.12
---------------- --------- -------- --------- -------- -------
Total income (loss) from investment
operations......................... 4.06 2.02 1.30 (1.17) (1.77) 1.10
---------------- --------- -------- --------- -------- -------
Less distributions:
In excess of net investment income........ (0.15) (0.04) -- -- (0.03) --
---------------- --------- -------- --------- -------- -------
Net Asset Value, end of period............ $ 17.32 $ 13.41 $ 11.43 $ 10.13 $ 11.30 $ 13.10
---------------- --------- -------- --------- -------- -------
---------------- --------- -------- --------- -------- -------
Total Return**............................ 30.66% 17.68% 12.73% (10.35)% (13.53)% 9.17%
---------------- --------- -------- --------- -------- -------
---------------- --------- -------- --------- -------- -------
Ratios/Supplemental Data:
Net assets, end of period (in 000's)...... $ 66,226 $ 44,302 $ 19,161 $ 9,643 $ 14,831 $11,292
Ratio of net investment gain (loss) to
average net assets...................... 0.14%+ 0.00% (0.58)% (0.63)% (1.26)% (3.83)%+
Ratio of total expenses to average net
assets.................................. 1.48%+(a) 1.79%(a) 2.46%(c) 2.84%(b)(c) 2.16% 2.09%+
Portfolio turnover rate................... 59% 94% 67% 116% 169% 20%
Average brokerage commission rate (d)..... $0.01242 $ 0.00835 $ 0.0046 N/A N/A N/A
</TABLE>
- ------------------
* The BJB International Equity Fund commenced operations on October 4, 1993.
** Total return represents aggregate total return for the periods indicated and
does not reflect any applicable sales charge.
# Per share amounts have been calculated using the monthly average share
method, which more appropriately presents the per share data for the period
since the use of the undistributed income method does not accord with
results of operations.
+ Annualized.
++ Net investment loss before waiver of fees by the investment adviser was
($0.03), ($0.07) and ($0.05) for the six months ended ended April 30, 1998
and for the years ended October 31, 1997 and 1996, respectively.
(a) Figure is net of the voluntary expense waiver by the Adviser. Excluding
this waiver, the ratio of total expenses to average net assets would have
been 1.98% and 2.29% for the six months ended April 30, 1998 and for the
year ended October 31, 1997, respectively.
(b) Figures are net of the expense reimbursement by the Adviser in connection
with the voluntary and involuntary expense limitation. Before the expense
reimbursement the ratio of total expenses to average net assets would have
been 3.36%.
(c) Includes indirectly paid expenses. Excluding indirectly paid expenses the
ratio of total expenses to average net assets would have been 2.37% and
2.67% for the years ended October 31, 1996 and 1995, respectively.
(d) The average broker commission rate will vary depending on the markets in
which trades are executed.
See Notes to Financial Statements.
24
<PAGE>
BJB INVESTMENT FUNDS
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES
BJB Investment Funds (the 'Trust') is registered with the Securities and
Exchange Commission under the Investment Company Act of 1940, as amended (the
'1940 Act'), as an open-end management investment company that currently offers
two investment funds: BJB Global Income Fund (the 'Income Fund') and BJB
International Equity Fund (the 'Equity Fund') (individually, a 'Fund' and
collectively, the 'Funds'). The Trust was organized as a Massachusetts business
trust under the laws of the Commonwealth of Massachusetts on April 30, 1992. The
Income Fund commenced operations on July 1, 1992 and the Equity Fund commenced
operations on October 4, 1993.
The Income Fund's investment objective is to maximize current income
consistent with the protection of principal by investing in a non-diversified
portfolio of fixed income securities of governmental, supranational and
corporate issuers denominated in various currencies, including U.S. dollars. The
Equity Fund's investment objective is long-term growth of capital from investing
in a diversified portfolio of common stocks of foreign issuers of all sizes.
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. The
presentation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from these estimates.
Portfolio valuation: Generally, each Fund's investments are valued at
market value or, in the absence of a market value, at fair value as determined
by or under the direction of the Trust's Board of Trustees. A security which is
traded primarily on a United States or foreign stock exchange is valued at the
last sale price on that exchange or, if there were no sales during the day, at
the mean of the current quoted bid and asked prices. Portfolio securities which
are traded primarily on foreign securities exchanges are generally valued at the
preceding closing values of such securities on their respective exchanges,
except that when an occurrence subsequent to the time that a value was so
established is likely to have changed such value, then the fair value of those
securities will be determined by consideration of other factors by or under the
direction of the Trust's Board of Trustees or its delegates. Debt securities
(other than government securities and short-term obligations) are valued by
independent pricing services approved by the Trust's Board of Trustees.
Investments in government securities (other than short-term securities) are
valued at the mean of the quoted bid and asked prices in the over-the-counter
market. Short-term investments that mature in 60 days or less are valued at
amortized cost.
Repurchase agreements: The Funds may engage in repurchase agreement
transactions. Under the terms of a typical repurchase agreement, a Fund takes
possession of an underlying debt obligation, in return for the use of the Funds
available cash, subject to an obligation of the seller to repurchase, and the
Fund to resell, the obligation at an agreed-upon price and time, thereby
determining the yield during the Fund's holding period. This arrangement results
in a fixed rate of return that is not subject to market fluctuations during a
Fund's holding period. The value of the collateral at all times is equal to at
least 100% of the total amount of the repurchase obligations, including accrued
interest. In the event of counterparty default, the Fund has the right to use
the collateral to offset losses incurred. There is potential loss to a Fund in
the event the Fund is delayed or prevented from exercising its rights to dispose
of the collateral securities, including the risk of a possible decline in the
value of the underlying securities during the period while the Fund seeks to
assert its rights. The Funds' investment advisers, acting under the supervision
of the Board of Trustees, reviews the value of the collateral and the
creditworthiness of those banks and dealers with which the Funds enter into
repurchase agreements to evaluate potential risks.
Foreign currency: The books and records of the Funds are maintained in
United States (U.S.) dollars. Foreign currencies, investments and other assets
and liabilities are translated into U.S. dollars at the exchange rates
prevailing at the end of the period, purchases and sales of investment
securities and income and expenses are translated on the respective dates of
such transactions. Unrealized gains or losses on investments which result from
changes in foreign currencies have been included in the net unrealized
appreciation (depreciation) of investments. Net realized currency gains and
losses include foreign currency gains and losses between trade date and
settlement date on investment securities transactions, foreign currency
transactions and the difference between the amounts of interest and dividends
recorded on the books of the Funds and the amount actually received. The portion
of foreign currency
25
<PAGE>
BJB INVESTMENT FUNDS
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)--(CONTINUED)
gains and losses related to fluctuations in exchange rates between the purchase
trade date and sale trade date is included in realized gains and losses on
security transactions.
Forward foreign currency contracts: Forward foreign currency contracts are
valued at the forward rate and are marked-to-market daily. The change in market
value is recorded by a Fund as an unrealized gain or loss. When the contract is
closed, a Fund records a realized gain or loss equal to the difference between
the value of the contract at the time it was opened and the value at the time it
was closed.
The use of forward foreign currency contracts does not eliminate
fluctuations in the underlying prices of a Fund's portfolio securities, but it
does establish a rate of exchange that can be achieved in the future. Although
forward foreign currency contracts limit the risk of loss due to a decline in
the value of the currency holdings, they also limit any potential gain that
might result should the value of the currency increase. In addition, a Fund
could be exposed to risks if the counterparties to the contracts are unable to
meet the terms of their contracts.
Option contracts: Purchase of put and call options are recorded as an
investment, the value of which is marked-to-market daily. When a purchased
option expires, a Fund will realize a loss equal to the premium paid. When a
Fund enters into a closing sale transaction, the Fund will realize a gain or
loss depending on whether the sales proceeds from the closing sale transaction
are greater or less than the premium paid. When a Fund exercises a put option,
it will realize a gain or loss from the sale of the underlying security and the
proceeds from such sale will be decreased by the premium originally paid. When a
Fund exercises a call option, the cost of the security which the Fund purchases
upon exercise will be increased by the premium originally paid.
When a Fund writes a call option or a put option, an amount equal to the
premium received by a Fund is recorded as a liability, the value of which is
marked-to-market daily. When a written option expires, a Fund realizes a gain
equal to the amount of the premium received. When a Fund enters into a closing
purchase transaction the Fund realizes a gain (or loss if the cost of the
closing purchase transaction exceeds the premium received when the option was
sold) without regard to any unrealized gain or loss on the underlying security,
and the liability related to such option is eliminated. When a call option is
exercised, a Fund realizes a gain or loss from the sale of the underlying
security and the proceeds from such sale are increased by the premium originally
received. When a put option is exercised, the amount of the premium originally
received will reduce the cost of the security which a Fund purchased upon
exercise.
Unlike options on specific securities, all settlements of options on stock
indices are in cash and gains or losses depend on general movements in the
stocks included in the index rather than price movements on a particular stock.
There is no physical delivery of securities.
The risk associated with purchasing options is limited to the premium
originally paid. The risk in writing a call option is that a Fund may forego the
opportunity of profit if the market price of the underlying security increases
and the option is exercised. The risk in writing a put option is that a Fund may
incur a loss if the market price of the underlying security decreases and the
option is exercised. There is also the risk that a Fund may not be able to enter
into a closing transaction because of an illiquid secondary market. In addition,
the Fund could be exposed to risks if the counterparties to the transactions are
unable to meet the terms of the contracts.
Securities transactions and investment income: Securities transactions are
recorded as of the trade date. Realized gains and losses from securities
transactions are recorded on the identified cost basis. Interest income is
recorded on the accrual basis. Dividend income is recorded on the ex-dividend
date.
Dividends and distributions to shareholders: Distributions to shareholders
are recorded on the ex-dividend date. Each Fund intends to distribute annually
to its shareholders substantially all of its taxable income. The Income Fund
declares and pays monthly dividends. The Equity Fund declares and pays dividends
from its net investment income, if any, annually. Both Funds will distribute net
realized capital gains, if any, annually. Additional distributions of net
investment income and capital gains may be made at the discretion of the Board
of Trustees to avoid the application of the excise tax imposed under Section
4982 of the Internal Revenue Code of 1986, as amended, for certain undistributed
amounts. Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles. These differences are primarily due to differing
treatments of income and gains on various investment securities held by a Fund,
timing differences and differing characterization of distributions made by a
Fund as a whole.
26
<PAGE>
BJB INVESTMENT FUNDS
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)--(CONTINUED)
Federal income taxes: The Trust intends that each Fund separately qualify
as a regulated investment company for U.S. federal income tax purposes.
Accordingly, the Funds do not anticipate that any income taxes will be paid. It
is expected that certain capital gains earned by the Funds and certain dividends
and interest received by the Funds will be subject to foreign withholding taxes.
2. INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS
Julius Baer Investment Management Inc. ('Julius Baer Investment
Management') serves as the Income Fund's investment adviser pursuant to an
investment advisory agreement. The Income Fund pays Julius Baer Investment
Management a quarterly fee for its investment advisory services calculated at an
annual rate of 0.65% of the Income Fund's average daily net assets. Bank Julius
Baer & Co., Ltd.--New York Branch ('Bank Julius Baer') serves as the Income
Fund's servicing agent pursuant to a servicing agent agreement with Julius Baer
Investment Management. Out of its advisory fee, Julius Baer Investment
Management pays Bank Julius Baer a quarterly fee calculated at an annual rate of
0.15% of the Income Fund's average daily net assets.
Bank Julius Baer serves as the Equity Fund's investment adviser pursuant to
an investment advisory agreement. The Equity Fund pays Bank Julius Baer a
quarterly fee for its investment advisory services calculated at an annual rate
of 1.00% of the Equity Fund's average daily net assets. During the six months
ended April 30, 1998, the adviser agreed to waive half (0.50%) of its 1.00% fee.
Bank Julius Baer's voluntary agreement to waive half of its investment advisory
fee terminated May 15, 1998.
No director, officer or employee of Julius Baer Investment Management, Bank
Julius Baer or any affiliates of those entities received any compensation from
the Trust for serving as an officer or Trustee of the Funds. The Funds pay each
of the Trustees who is not a director, officer or employee of Julius Baer
Investment Management, Bank Julius Baer or any affiliate thereof an annual fee
of $5,000 plus $250 for each Board of Trustees meeting attended. In addition,
the Funds reimburse these Trustees for travel and out-of-pocket expenses
incurred in connection with the Board of Trustees meetings.
For the six months ended April 30, 1998, the International Equity Fund
incurred total brokerage commissions of $155,794 of which $13,742 was paid in
total to affiliates of the advisers.
At a Board Meeting held on May 21, 1998, the Board of Trustees of the Trust
approved a new investment advisory agreement pursuant to which, subject to
shareholder approval, Bank Julius Baer would replace Julius Baer Investment
Management as the investment adviser for the Income Fund as of July 1, 1998.
3. DISTRIBUTION AND SHAREHOLDER SERVICING PLAN
The Trust has adopted a Shareholder Services Plan and a Distribution Plan
(the 'Plans') pursuant to Rule 12b-1 of the 1940 Act. Under the Plans, the Funds
may compensate certain financial institutions, including Funds Distributor Inc.,
the distributor, for certain distribution, shareholder servicing, administrative
and accounting services for their clients and customers who are beneficial
owners of each of the Funds' shares. A Fund may expend an aggregate amount on an
annual basis not to exceed 0.25% of the value of the average daily net assets of
the Fund. For the six months ended April 30, 1998, the Income Fund and Equity
Fund incurred $14,039 and $63,761 respectively, in distribution and shareholder
servicing fees.
Under their terms, the Plans shall remain in effect from year to year,
provided such continuance is approved annually by a vote of a majority of the
Trustees and a majority of those Trustees who are not 'interested persons' of
the Trust and who have no direct or indirect financial interest in the operation
of the Plans or in any agreement related to the Plans.
4. PURCHASES AND SALES OF SECURITIES
Cost of purchases and proceeds from sales of securities, excluding U.S.
government securities and short-term investments, during the six months ended
April 30, 1998, were as follows:
<TABLE>
<CAPTION>
COST OF PROCEEDS
PURCHASES FROM SALES
----------- -----------
<S> <C> <C>
Income Fund........................... $ 3,210,017 $ 4,408,624
Equity Fund........................... 36,465,501 29,618,397
</TABLE>
27
<PAGE>
BJB INVESTMENT FUNDS
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)--(CONTINUED)
Cost of purchases and proceeds from sales of long-term U.S. government
securities during the six months ended April 30, 1998, were $6,400,402 and
$6,008,654, respectively for the Income Fund.
At April 30, 1998, aggregate gross unrealized appreciation for all
securities in which there was an excess of value over tax cost, and aggregate
gross unrealized depreciation for all securities in which there was an excess of
tax cost over value was:
<TABLE>
<CAPTION>
UNREALIZED UNREALIZED
APPRECIATION DEPRECIATION
------------ ------------
<S> <C> <C>
Income Fund.............................. $ 204,318 $ 180,163
Equity Fund.............................. 17,747,989 1,017,454
</TABLE>
5. SHARES OF BENEFICIAL INTEREST
The Trust may issue an unlimited number of shares of beneficial interest of
each Fund, with a par value of $.001 per share. Changes in outstanding shares of
beneficial interest on the Income Fund and the Equity Fund were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED 4/30/98 YEAR ENDED 10/31/97
------------------------ ------------------------
SHARES AMOUNT SHARES AMOUNT
--------- ----------- --------- -----------
<S> <C> <C> <C> <C>
Income Fund:
Sold................................................................. 56,485 $ 661,578 287,326 $ 3,378,426
Issued as reinvestment of dividends.................................. 19,626 228,882 48,186 562,733
Redeemed............................................................. (112,207) (1,315,338) (534,288) (6,205,907)
--------- ----------- --------- -----------
Net decrease......................................................... (36,095) $ (424,878) (198,776) $(2,264,748)
--------- ----------- --------- -----------
--------- ----------- --------- -----------
<CAPTION>
SHARES AMOUNT SHARES AMOUNT
--------- ----------- --------- -----------
<S> <C> <C> <C> <C>
Equity Fund:
Sold................................................................. 1,020,642 $15,290,418 2,093,850 $27,215,448
Issued as reinvestment of dividends.................................. 36,110 497,235 104 1,243
Redeemed............................................................. (535,444) (7,612,241) (468,551) (6,318,210)
--------- ----------- --------- -----------
Net increase......................................................... 521,308 $ 8,175,412 1,625,403 $20,898,481
--------- ----------- --------- -----------
--------- ----------- --------- -----------
</TABLE>
6. ORGANIZATIONAL COSTS
All costs in connection with the organization of the International Equity
Fund, including the fees and expenses of registering and qualifying its shares
for distribution under federal and state securities regulations, are being
amortized on the straight-line method over a period of sixty months from October
4, 1993, the date the International Equity Fund commenced operations. In the
event that any of the initial shares of the Fund are redeemed during such
amortization period, the Fund will be reimbursed for any unamortized costs in
the same proportion as the number of initial shares outstanding bears to the
total number of shares outstanding at the time of redemption.
7. FOREIGN SECURITIES
Investing in securities of foreign companies and foreign governments
involves special risks and considerations not typically associated with
investing in U.S. companies and the United States government. These risks
include revaluation of currencies and future adverse political and economic
developments. Moreover, securities of many foreign companies and foreign
governments and their markets may be less liquid and their prices more volatile
than those of securities of comparable U.S. companies and the United States
government.
28
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