<PAGE>
A VARIABLE
ANNUITY ISSUED
BY GENERAL
AMERICAN LIFE
INSURANCE COMPANY
/ /
GT GLOBAL
ALLOCATOR
/ /
SEMIANNUAL REPORT
JUNE 30, 1998
[LOGO]
<PAGE>
TABLE
OF CONTENTS
<TABLE>
<S> <C>
Reports on the
Funds................ 1
Funds'
Financial
Statements........... F1
Portfolio holdings and views of
the Funds' managers described in
this semiannual report are as of
the date of the report, unless
otherwise noted, and are subject
to change.
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Understanding the
Performance Tables
The GT Global Allocator variable annuity issued by General American
Life Insurance
Company offers 14 Variable Divisions within the annuity's Separate
Accounts Twenty-
Eight and Twenty-Nine to which contract owners may allocate premiums.
The performance data shown in the upper left hand corner of each report
are for the GT
Global Variable Divisions and their corresponding GT Global Variable
Funds, which are
the underlying investment vehicles for the Divisions. No annuity
contract owner can
invest directly in the GT Global Variable Funds.
Division performance reflects the corresponding Fund performance, less
the separate
account annual charges of 1.4% (mortality and expense risk charge).
Division
performance is shown both with and without surrender charges. Maximum
surrender
charges are 6% in the first year, decreasing one percentage point
annually thereafter for
each premium. Fund performance assumes all Fund expenses but not the
charges and
expenses of the annuity or separate account described above. None of
the performance
returns reflect the $30 administration fee for annuity contracts less
than $20,000.
Past performance is no guarantee of future results. Investment return
and principal
value will fluctuate; therefore, an investor's units, when surrendered,
may be worth more
or less than their original cost. From time to time, the investment
advisor may waive
some fees and/or reimburse some expenses, without which performance
would be lower.
Waivers and/or reimbursements are subject to change.
Fund holdings and geographic allocations will change as market
conditions change.
GT Global, Inc., Distributor and Principal Underwriter.
Policy Form #10079
</TABLE>
<PAGE>
GT GLOBAL
VARIABLE STRATEGIC INCOME FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: February 10, 1993
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year 2.03% -3.97%
Life of Fund 8.35% 8.22%
Fund Performance
Average Annualized
1 Year 3.46%
Life of Fund 9.87%
</TABLE>
PERFORMANCE
Over the six-month period ending June 30, 1998, the Fund returned a total of
0.84%. During the same time frame, total return for the JP Morgan Global
Government Bond Index(1) was 3.27%; -0.25% for the JP Morgan Emerging Markets
Bond Index (EMBI) (Brady).(2)
MARKET REVIEW
The Japanese economy is still at the center of the Asian crisis and its recovery
is key to resolution. The Japanese economy is officially in recession for the
first time since 1974. As the world's second-largest economy, its lack of growth
has prolonged and deepened the Asian crisis. Now, as global risk premiums have
increased, the turmoil is beginning to spread and capital is fleeing to safer
havens, most notably the U.S.
As a result, many currencies are depreciating and hitting historic lows versus a
rocketing U.S. dollar. The rising dollar is a symptom, not the cause, of global
instability: we believe higher interest rates and intervention will not stop its
ascent; only true economic reform in Asia will. Outright currency
intervention--most notably in Japan, Australia, and South Africa--and high
interest rate policies--in Thailand, Indonesia, Russia, and Mexico--have proven
ineffective and failed to stem the flight of capital.
Recent global instability has led to decreased domestic demand and investment in
the affected countries. Reduced demand and excess manufacturing capacity
continue to impact the industrialized world through a decrease in exports. In
this environment, we expect inflation will remain contained, making it difficult
for America or continental European countries to raise interest rates. We view
this as a potentially positive development for the Fund.
OUTLOOK
Looking ahead, we believe global bonds may trade in a narrow range with a bias
towards lower rates. In this benign inflationary environment, investments based
on credit spreads and certain emerging markets could perform well. The main risk
to this outlook is if the Asian or Russian crisis is not contained. If these
issues are not resolved, we feel they have the potential to ignite global asset
price deflation, causing credit risk premiums to dramatically expand, while the
U.S. dollar continues to appreciate.
In currency markets, the U.S. dollar has appreciated for the last three-
and-a-half years based on the benefits of stronger economic factors such as low
interest rates and inflation. But as European growth is taking hold, we feel
inflation, growth, and the gap between the higher European rates compared to
U.S. rates should continue to narrow. Additionally, we feel the rising U.S.
current account deficit could negatively weigh on the dollar.
The level of the dollar versus the yen is driven by two factors: short-term fear
and long-term fundamentals. In the short term, volatility has increased
substantially as market participants have sold dollars on the slightest hint of
official intervention. In the long term, intervention has given Japanese
authorities a window of stability in which to enact much-needed economic reform.
But even if reforms are enacted, the significant restructuring of the Japanese
economy would most likely imply weaker domestic demand, higher public debt and
looser monetary policy. If no reforms are enacted, however, the economy will
continue to contract. Either way, then, we believe the yen will weaken for the
foreseeable future.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE STRATEGIC INCOME JP MORGAN GLOBAL GOVERNMENT BOND JP MORGAN EMBI
<S> <C> <C> <C>
10-Feb-93 $10,000 $10,000 $10,000
28-Feb-93 $10,008 $10,209 $10,118
31-Mar-93 $10,078 $10,366 $10,646
30-Apr-93 $10,082 $10,555 $10,860
31-May-93 $10,143 $10,622 $11,229
30-Jun-93 $10,521 $10,630 $11,622
31-Jul-93 $10,871 $10,635 $12,106
31-Aug-93 $11,459 $10,950 $12,349
30-Sep-93 $11,502 $11,065 $12,511
31-Oct-93 $12,168 $11,060 $13,565
30-Nov-93 $11,986 $10,979 $13,429
31-Dec-93 $12,755 $11,092 $14,249
31-Jan-94 $12,842 $11,196 $14,288
28-Feb-94 $11,553 $11,073 $13,099
31-Mar-94 $10,506 $11,022 $11,601
30-Apr-94 $10,396 $11,014 $11,606
31-May-94 $10,569 $10,923 $12,408
30-Jun-94 $10,447 $11,052 $11,409
31-Jul-94 $10,482 $11,156 $11,689
31-Aug-94 $10,856 $11,127 $12,524
30-Sep-94 $11,053 $11,183 $12,647
31-Oct-94 $10,975 $11,350 $12,289
30-Nov-94 $10,878 $11,207 $12,414
31-Dec-94 $10,575 $11,233 $11,588
31-Jan-95 $10,487 $11,461 $11,187
28-Feb-95 $10,438 $11,756 $10,604
31-Mar-95 $10,579 $12,354 $10,304
30-Apr-95 $11,130 $12,551 $11,411
31-May-95 $11,584 $12,901 $12,416
30-Jun-95 $11,615 $12,982 $12,657
31-Jul-95 $11,614 $13,043 $12,666
31-Aug-95 $11,614 $12,681 $12,965
30-Sep-95 $11,884 $12,966 $13,411
31-Oct-95 $11,946 $13,093 $13,274
30-Nov-95 $12,233 $13,239 $13,738
31-Dec-95 $12,637 $13,403 $14,779
31-Jan-96 $13,170 $13,265 $16,081
29-Feb-96 $12,686 $13,188 $14,951
31-Mar-96 $12,804 $13,168 $15,334
30-Apr-96 $13,109 $13,119 $16,106
31-May-96 $13,273 $13,132 $16,306
30-Jun-96 $13,472 $13,247 $16,758
31-Jul-96 $13,700 $13,491 $16,885
31-Aug-96 $13,995 $13,547 $17,433
30-Sep-96 $14,518 $13,622 $18,522
31-Oct-96 $14,760 $13,892 $18,570
30-Nov-96 $15,278 $14,090 $19,610
31-Dec-96 $15,364 $13,992 $19,828
31-Jan-97 $15,473 $13,642 $20,544
28-Feb-97 $15,570 $13,548 $20,913
31-Mar-97 $15,134 $13,445 $20,097
30-Apr-97 $15,316 $13,369 $20,779
31-May-97 $15,721 $13,685 $21,614
30-Jun-97 $16,046 $13,840 $22,117
31-Jul-97 $16,374 $13,790 $23,183
31-Aug-97 $16,320 $13,773 $22,955
30-Sep-97 $16,789 $14,078 $23,723
31-Oct-97 $16,169 $14,377 $21,170
30-Nov-97 $16,302 $14,204 $22,692
31-Dec-97 $16,462 $14,188 $23,031
31-Jan-98 $16,524 $14,331 $22,900
28-Feb-98 $16,784 $14,437 $23,651
31-Mar-98 $17,026 $14,329 $24,239
30-Apr-98 $17,145 $14,549 $24,253
31-May-98 $16,861 $14,612 $23,529
30-Jun-98 $16,601 $14,652 $22,974
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the various indices for the same period. It assumes a hypothetical $10,000
initial investment in the Fund and reflects all Fund expenses but not charges
and expenses of the separate account. Past performance is no guarantee of future
results.
(1) The JP Morgan Global Government Bond Index is a market value-weighted
average of government bonds from 13 major bond markets. It includes the
effect of reinvested coupons and is measured in U.S. dollars.
(2) The JP Morgan EMBI (Brady) is a market value-weighted average of Brady bonds
from 10 emerging bond markets. It includes the effect of reinvested coupons
and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not incur
sales charges and professional management fees.
1
<PAGE>
GT GLOBAL
VARIABLE GLOBAL GOVERNMENT INCOME FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: February 10, 1993
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year 7.04% 1.04%
Life of Fund 3.97% 3.82%
Fund Performance
Average Annualized
1 Year 8.54%
Life of Fund 5.42%
</TABLE>
PERFORMANCE
Over the six-month period ending June 30, 1998, the Fund returned a total of
3.76%. During the same time frame, total return for the JP Morgan Global
Government Bond Index(1) was 3.27%.
MARKET REVIEW
The Japanese economy is still at the center of the Asian crisis and its recovery
is the key to the crisis' resolution. The Japanese economy is officially in
recession for the third time this decade. As the world's second-largest economy,
its lack of growth has prolonged and deepened the Asian crisis. Now, as global
risk premiums have increased, the turmoil is beginning to spread and capital is
fleeing to safer havens, most notably the U.S.
As a result, many currencies are depreciating and hitting historic lows versus a
rocketing U.S. dollar. The rising dollar is a symptom, not the cause, of global
instability: we believe higher interest rates and intervention will not stop its
ascent; only true economic reform in Asia will. Outright currency
intervention--most notably in Japan, Australia, and South Africa--and high
interest rate policies--in Thailand, Indonesia, Russia, and Mexico--have proven
ineffective and failed to stem the flight of capital.
Recent global instability has led to decreased domestic demand and investment in
the affected countries. Reduced demand and excess manufacturing capacity
continue to impact the industrialized world through a decrease in exports. In
this environment, we expect inflation will remain contained, making it difficult
for America or continental European countries to raise interest rates. We view
this as a potentially positive development for the Fund.
OUTLOOK
Looking ahead, we believe global bonds may trade in a narrow range with a bias
towards lower rates. In this benign inflationary environment, investments based
on credit spreads and in certain emerging markets could perform well. The main
risk to this outlook is if the Asian or Russian crisis is not contained. If
these issues are not resolved, we feel they have the potential to ignite global
asset price deflation, causing credit risk premiums to dramatically expand,
while the U.S. dollar continues to appreciate.
In currency markets, the U.S. dollar has appreciated for the last three-
and-a-half years based on the benefits of stronger economic factors such as low
interest rates and inflation. But as European growth is taking hold, we feel
inflation, growth, and the gap between the higher European rates compared to
U.S. rates should continue to narrow. Additionally, we feel the rising U.S.
current account deficit could negatively weigh on the dollar.
The level of the dollar versus the yen is driven by two factors: short-term fear
and long-term fundamentals. In the short term, volatility has increased
substantially as market participants have sold dollars on the slightest hint of
official intervention. In the long term, intervention has given Japanese
authorities a window of stability in which to enact much-needed economic reform.
But even if reforms are enacted, the significant restructuring of the Japanese
economy would most likely imply weaker domestic demand, higher public debt, and
looser monetary policy. If no reforms are enacted, however, the economy will
continue to contract. Either way, then, we believe the yen should weaken for the
foreseeable future.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE TELECOMMUNICATIONS MSCI WORLD MSCI TELECOMMUNICATIONS SALOMON GLOBAL TELECOM
<S> <C> <C> <C> <C>
10/18/93 $10,000 $10,000 $10,000 $10,000
10/31/93 $10,008 $10,020 $9,995 $10,125
11/30/93 $9,942 $9,455 $9,469 $9,546
12/31/93 $10,892 $9,919 $9,640 $10,170
1/31/94 $11,358 $10,575 $10,078 $10,979
2/28/94 $11,033 $10,440 $9,421 $10,387
3/31/94 $10,167 $9,991 $9,138 $9,823
4/30/94 $10,402 $10,302 $9,449 $9,919
5/31/94 $10,485 $10,330 $9,517 $9,874
6/30/94 $10,226 $10,303 $9,485 $9,783
7/31/94 $10,927 $10,501 $9,783 $10,181
8/31/94 $11,662 $10,819 $10,105 $10,724
9/30/94 $11,562 $10,537 $9,830 $10,414
10/31/94 $11,871 $10,838 $10,062 $10,543
11/30/94 $11,370 $10,370 $9,390 $9,856
12/31/94 $11,670 $10,473 $9,382 $9,675
1/31/95 $11,529 $10,317 $9,610 $9,503
2/28/95 $11,337 $10,470 $9,622 $9,171
3/31/95 $11,345 $10,977 $9,829 $9,598
4/30/95 $11,662 $11,361 $9,975 $9,849
5/31/95 $12,422 $11,461 $10,147 $9,868
6/30/95 $13,422 $11,459 $10,334 $10,036
7/31/95 $14,552 $12,035 $10,600 $10,430
8/31/95 $14,920 $11,769 $10,863 $10,586
9/30/95 $15,399 $12,114 $11,533 $10,874
10/31/95 $14,166 $11,926 $11,420 $10,526
11/30/95 $14,423 $12,342 $11,519 $10,693
12/31/95 $14,432 $12,705 $11,903 $10,931
1/31/96 $14,594 $12,937 $12,136 $11,166
2/29/96 $15,579 $13,018 $12,061 $11,078
3/31/96 $15,476 $13,237 $11,908 $11,058
4/30/96 $17,231 $13,551 $12,317 $11,497
5/31/96 $18,018 $13,565 $12,215 $11,467
6/30/96 $17,746 $13,636 $12,211 $11,551
7/31/96 $16,208 $13,157 $11,419 $10,974
8/31/96 $16,939 $13,311 $11,503 $11,196
9/30/96 $17,024 $13,834 $11,666 $11,337
10/31/96 $16,255 $13,933 $11,925 $11,464
11/30/96 $17,024 $14,717 $12,603 $12,071
12/31/96 $17,223 $14,483 $13,013 $12,464
1/31/97 $18,524 $14,660 $13,375 $12,811
2/28/97 $17,603 $14,831 $13,541 $12,969
3/31/97 $16,673 $14,541 $13,454 $12,886
4/30/97 $16,844 $15,018 $13,718 $13,139
5/31/97 $18,363 $15,948 $14,859 $14,232
6/30/97 $19,243 $16,746 $15,534 $14,878
7/31/97 $21,044 $17,520 $15,806 $15,139
8/31/97 $20,031 $16,351 $14,684 $14,064
9/30/97 $21,897 $17,241 $15,669 $15,008
10/31/97 $20,074 $16,337 $14,940 $14,310
11/30/97 $19,603 $16,628 $16,059 $15,382
12/31/97 $19,731 $16,834 $16,729 $16,023
1/31/98 $19,946 $17,305 $17,569 $16,827
2/28/98 $21,865 $18,479 $18,474 $17,694
3/31/98 $23,774 $19,262 $20,445 $19,582
4/30/98 $23,870 $19,453 $20,085 $19,237
5/31/98 $23,077 $19,212 $19,663 $18,833
6/30/98 $24,012 $19,671 $20,636 $19,765
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the JP Morgan Global Government Bond Index for the same time period. It assumes
a hypothetical $10,000 initial investment in the Fund and reflects all Fund
expenses but not charges and expenses of the separate account. Past performance
is no guarantee of future results.
(1) The JP Morgan Global Government Bond Index is a market value-weighted
average of government bonds from 13 major bond markets. It includes the
effect of reinvested coupons and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
2
<PAGE>
GT GLOBAL
VARIABLE U.S. GOVERNMENT INCOME FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: February 10, 1993
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year 8.42% 2.42%
Life of Fund 3.75% 3.59%
Fund Performance
Average Annualized
1 Year 9.94%
Life of Fund 5.21%
</TABLE>
PERFORMANCE
The Fund's total return for the six months ended June 30, 1998, was 3.79%; total
return for the JP Morgan U.S. Government Bond Index(1) over the same period was
4.26%.
MARKET REVIEW
Fixed income markets continued to be buffeted by overseas turmoil during the
first half of 1998. Early in January, the market was expecting an imminent
reduction in rates by the Federal Reserve Board (the Fed) to counteract the
negative effects from the Asian economic crises. However, as it became apparent
that the U.S. economy remained strong, the Fed changed its position from a
neutral stance to one with a bias toward raising rates. During this period the
yields on Treasuries traded within a narrow range and ended the second quarter
lower across all maturities. The yields on the two-year note and long bond
declined by 17 and 30 basis points, respectively, for the six months ended June
30.
Fueled by low interest rates and strong stock and labor markets, the U.S.
economy continued its solid growth in the first quarter of 1998, rising at a
5.5% annual rate. Despite this rapid growth, inflation remained contained, with
the annualized rate running between 1% and 2%. During the 12 months ended June
30, the Consumer Price Index rose 1.7%. As the second quarter came to a close,
it appeared that the economy was finally slowing in response to the Asian
influence and the strike at General Motors. This was confirmed when second
quarter GDP was reported as an increase of 1.4%.
During this period, the Fed remained on watch for signs of incipient inflation,
which never appeared. As the Asia situation continued to unfold, the Fed
remained hesitant to raise rates. As a result, the Federal Funds target remained
at 5.5% throughout the reporting period.
OUTLOOK
As the third quarter opened, most market participants were expecting the Fed to
remain on the sidelines for the foreseeable future, though opinion remained
divided about its next move. Some were concerned that strong U.S. growth would
generate inflationary pressures, leading to a tighter Fed policy. Others
remained concerned that Asia's dampening effects on the U.S. would eventually
encourage the Fed to lower rates. With the flat yield curve and all the
uncertainty about the future direction of rates and where the stock market is
headed, Fund managers will continue to remain cautious.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE GROWTH & INCOME MSCI WORLD JP MORGAN GLOBAL GOVT.
<S> <C> <C> <C>
10-Feb-93 $10,000 $10,000 $10,000
28-Feb-93 $10,008 $10,102 $10,161
31-Mar-93 $10,228 $10,689 $10,317
30-Apr-93 $10,261 $11,187 $10,505
31-May-93 $10,361 $11,447 $10,572
30-Jun-93 $10,437 $11,352 $10,580
31-Jul-93 $10,673 $11,588 $10,585
31-Aug-93 $11,145 $12,121 $10,898
30-Sep-93 $11,155 $11,899 $11,013
31-Oct-93 $11,460 $12,229 $11,008
30-Nov-93 $11,333 $11,539 $10,928
31-Dec-93 $11,775 $12,106 $11,039
31-Jan-94 $12,135 $12,906 $11,143
28-Feb-94 $11,639 $12,741 $11,021
31-Mar-94 $11,312 $12,194 $10,970
30-Apr-94 $11,467 $12,573 $10,962
31-May-94 $11,355 $12,608 $10,872
30-Jun-94 $11,278 $12,575 $11,000
31-Jul-94 $11,573 $12,816 $11,104
31-Aug-94 $11,721 $13,204 $11,075
30-Sep-94 $11,455 $12,860 $11,130
31-Oct-94 $11,796 $13,228 $11,297
30-Nov-94 $11,394 $12,656 $11,154
31-Dec-94 $11,439 $12,781 $11,180
31-Jan-95 $11,360 $12,592 $11,407
28-Feb-95 $11,580 $12,778 $11,700
31-Mar-95 $11,590 $13,396 $12,296
30-Apr-95 $11,821 $13,866 $12,492
31-May-95 $12,114 $13,987 $12,841
30-Jun-95 $12,059 $13,986 $12,921
31-Jul-95 $12,417 $14,688 $12,982
31-Aug-95 $12,166 $14,363 $12,621
30-Sep-95 $12,471 $14,785 $12,905
31-Oct-95 $12,597 $14,555 $13,031
30-Nov-95 $12,813 $15,063 $13,177
31-Dec-95 $13,211 $15,506 $13,340
31-Jan-96 $13,301 $15,789 $13,203
29-Feb-96 $13,392 $15,888 $13,126
31-Mar-96 $13,410 $16,156 $13,106
30-Apr-96 $13,483 $16,538 $13,057
31-May-96 $13,647 $16,556 $13,071
30-Jun-96 $13,694 $16,642 $13,185
31-Jul-96 $13,602 $16,057 $13,428
31-Aug-96 $13,951 $16,245 $13,484
30-Sep-96 $14,200 $16,884 $13,558
31-Oct-96 $14,653 $17,005 $13,827
30-Nov-96 $15,245 $17,961 $14,024
31-Dec-96 $15,368 $17,676 $13,927
31-Jan-97 $15,247 $17,892 $13,578
28-Feb-97 $15,489 $18,101 $13,484
31-Mar-97 $15,555 $17,746 $13,382
30-Apr-97 $15,649 $18,329 $13,306
31-May-97 $16,295 $19,464 $13,621
30-Jun-97 $16,706 $20,438 $13,775
31-Jul-97 $17,257 $21,382 $13,725
31-Aug-97 $16,516 $19,955 $13,708
30-Sep-97 $17,477 $21,042 $14,012
31-Oct-97 $17,162 $19,938 $14,309
30-Nov-97 $17,315 $20,294 $14,137
31-Dec-97 $17,860 $20,544 $14,122
31-Jan-98 $18,062 $21,120 $14,264
28-Feb-98 $19,108 $22,552 $14,369
31-Mar-98 $19,751 $23,508 $14,262
30-Apr-98 $20,031 $23,741 $14,481
31-May-98 $20,301 $23,447 $14,543
30-Jun-98 $20,611 $24,007 $14,583
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the JP Morgan US Government Bond Index for the same period. It assumes a
hypothetical $10,000 initial investment in the Fund and reflects all Fund
expenses but not expenses and charges of the separate account. Past performance
is no guarantee of future results.
(1) The JP Morgan U.S. Government Bond Index is a market value-weighted index of
U.S. Treasury issues with remaining maturities of at least one year. It
includes the effect of reinvested coupons and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not incur
sales charges and professional management fees.
3
<PAGE>
GT GLOBAL
VARIABLE LATIN AMERICA FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: February 10, 1993
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year -28.50% -32.79%
Life of Fund 4.14% 3.98%
Fund Performance
Average Annualized
1 Year -27.49%
Life of Fund 5.60%
</TABLE>
PERFORMANCE
During the six-month period to June 30, 1998, sentiment toward many Latin
American equity markets continued to suffer due to the Asian crisis, which began
with the devaluation of the Thai baht in July 1997. The fall in oil prices in
March of this year also contributed to softness in several markets, including
Mexico and Venezuela.
Against this backdrop, the Fund returned -21.63%. The Morgan Stanley Capital
International (MSCI) Emerging Markets Latin America Index returned -19.88% and
the International Finance Corporation Investable (IFCI) Latin America Index
returned -18.97% over the same period.
In terms of country selection, the Fund performed well against the IFCI Index,
with our underweighted positions in Colombia and Mexico contributing on a
relative basis. On the other hand, overall stock selection, and in Brazil in
particular, lowered Fund returns.
MARKET REVIEW
Of all the Latin American markets, Mexico was initially the least affected by
the Asian crisis. However, recent weakness in the price of oil has led to a
tightening of Mexico's fiscal policy, which we believe may dampen domestic
demand. Moreover, trade accounts have deteriorated somewhat and, as a
consequence, the peso may soften.
We are underweighted in Argentina's major oil stocks, which account for about
43% of the stock market's capitalization. However, we are overweighted to banks
and other plays on domestic demand, which remain firm. We believe the Argentine
banking system is well capitalized and has significant potential for expansion
because Argentines have yet to make full use of banking services.
Having been overweighted in Brazil since November, we have recently been
trimming our position, although we see promising medium-term returns. We believe
Brazil's economic growth is likely to be constrained by the doubling in interest
rates, to around 40%, and by the latest fiscal package. Much of the economic
reform program's good news has already been discounted by the market. Further
progress may also be difficult following the deaths of two key political
supporters of President Cardoso.
OUTLOOK
While we felt that valuations in Mexico had become expensive relative to other
Latin American markets at the end of 1997, with recent underperformance we see
more reasonable valuations appearing.
One example would be in the construction sector, where we have stayed clear of
large, heavy civil engineering construction companies but are finding some
attractive home builders and cement companies. These companies are enjoying
strong demand on the back of a housing shortage and recovery in purchasing
power.
Our current stock selection in Brazil concentrates on privatization plays. These
companies tend to be less exposed to the economy, which has been sluggish
recently, yet are positively affected by progress on political reform and
privatization. These stocks should also benefit from any further recovery in
sentiment toward the country. We believe that once the government completes its
reforms--a gradual process at best--Brazil will have a structure in place that
will be able to support accelerated economic growth rates.
Our outlook for Peru is positive. The economy and corporate earnings are
recovering from damage caused by El Nino. Meanwhile, we find equity valuations
attractive. However, we are avoiding Colombia, where the economy remains weak
and political instability continues to be a key issue. We are also not adding to
our position in Venezuela, where we believe the fall in the price of oil will
contribute to an economic slowdown and, possibly, currency weakness.
We are near to neutrally weighted in Chile. Although we are disappointed by the
size of the recent increase in minimum wages, and expect the next fall in
interest rates will be delayed, we believe the stock market continues to
represent good value.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE LATIN AMERICA MSCI EMG LATIN AMERICA IFCI LATIN
<S> <C> <C> <C>
10-Feb-93 $10,000 $10,000 $10,000
28-Feb-93 $10,008 $9,892 $9,600
31-Mar-93 $9,983 $10,617 $10,417
30-Apr-93 $10,017 $10,112 $10,033
31-May-93 $10,167 $10,268 $10,167
30-Jun-93 $10,017 $10,938 $10,728
31-Jul-93 $10,358 $11,256 $11,035
31-Aug-93 $10,875 $12,224 $12,002
30-Sep-93 $11,192 $12,382 $12,198
31-Oct-93 $12,000 $12,832 $13,022
30-Nov-93 $12,767 $13,722 $14,017
31-Dec-93 $14,733 $15,509 $16,052
31-Jan-94 $17,058 $17,941 $18,208
28-Feb-94 $16,658 $17,351 $17,380
31-Mar-94 $15,708 $16,118 $16,214
30-Apr-94 $14,075 $14,901 $15,025
31-May-94 $14,285 $15,750 $15,810
30-Jun-94 $13,731 $14,692 $14,597
31-Jul-94 $14,779 $15,971 $15,994
31-Aug-94 $17,766 $18,560 $18,634
30-Sep-94 $18,688 $19,309 $19,461
31-Oct-94 $18,395 $18,359 $18,324
30-Nov-94 $18,395 $17,840 $18,004
31-Dec-94 $16,080 $14,938 $14,550
31-Jan-95 $13,765 $13,231 $12,236
28-Feb-95 $12,070 $11,235 $10,462
31-Mar-95 $10,820 $10,855 $10,149
30-Apr-95 $12,498 $12,469 $11,744
31-May-95 $12,339 $12,712 $11,775
30-Jun-95 $12,630 $12,923 $12,021
31-Jul-95 $13,102 $13,377 $12,665
31-Aug-95 $13,190 $13,541 $12,844
30-Sep-95 $12,817 $13,410 $12,680
31-Oct-95 $11,658 $12,301 $11,472
30-Nov-95 $11,736 $12,519 $11,869
31-Dec-95 $12,198 $12,916 $12,098
31-Jan-96 $13,377 $14,252 $13,235
29-Feb-96 $12,758 $13,432 $12,536
31-Mar-96 $12,994 $13,607 $12,737
30-Apr-96 $13,740 $14,354 $13,408
31-May-96 $14,084 $14,809 $13,758
30-Jun-96 $14,112 $15,176 $14,004
31-Jul-96 $13,496 $14,574 $13,386
31-Aug-96 $14,031 $14,993 $13,749
30-Sep-96 $14,455 $15,326 $14,015
31-Oct-96 $14,455 $15,170 $13,753
30-Nov-96 $14,607 $15,298 $13,816
31-Dec-96 $14,940 $15,753 $14,180
31-Jan-97 $16,101 $17,285 $15,487
28-Feb-97 $16,767 $18,423 $16,499
31-Mar-97 $16,282 $18,143 $16,307
30-Apr-97 $16,404 $19,026 $16,989
31-May-97 $17,332 $20,365 $18,361
30-Jun-97 $18,493 $22,132 $19,837
31-Jul-97 $19,472 $23,409 $20,937
31-Aug-97 $17,353 $21,197 $19,117
30-Sep-97 $18,927 $23,214 $20,731
31-Oct-97 $15,546 $18,781 $16,869
30-Nov-97 $16,141 $19,426 $17,388
31-Dec-97 $17,110 $20,740 $18,331
31-Jan-98 $15,212 $18,425 $16,209
28-Feb-98 $16,081 $19,384 $17,013
31-Mar-98 $17,019 $20,778 $18,126
30-Apr-98 $16,949 $20,320 $17,968
31-May-98 $14,506 $17,688 $15,729
30-Jun-98 $13,410 $16,617 $14,866
</TABLE>
The chart above shows the performance of the Fund since inception compared to
the various indices for the same period. It assumes a hypothetical $10,000
initial investment in the Fund and reflects all Fund expenses but not expenses
and charges of the separate account. Past performance is no guarantee of future
results.
(1) The MSCI Emerging Markets Latin America and IFCI Latin America indices are
market value-weighted averages of companies listed in Argentina, Brazil,
Chile, Columbia, Mexico, Peru and Venezuela. Both indices are measured in
U.S. dollars and include the effect of reinvested dividends. The MSCI
Emerging Markets Latin America Index has an aggregate market capitalization
of $293.09 billion, and the IFC Investable Latin America Index has an
aggregate market capitalization of $235.4 billiion. The Fund has changed
benchmarks to the IFCI Latin America Index because we feel it presents a
more accurate reflection of investment opportunities for foreign investors.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
4
<PAGE>
GT GLOBAL
VARIABLE GROWTH & INCOME FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: February 10, 1993
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year 21.66% 15.66%
Life of Fund 12.79% 12.68%
Fund Performance
Average Annualized
1 Year 23.37%
Life of Fund 14.38%
</TABLE>
PERFORMANCE
The Fund continued to perform well, returning a total of 15.40% for the
six-month period ended June 30, 1998. Total return over the same period was
16.85% for the Morgan Stanley Capital International (MSCI) World Index(1) and
3.27% for the JP Morgan Global Government Bond Index.(2)
Continuing to concentrate the Fund's equity investments in large capitalization
stocks has worked to advantage; large cap stocks again outperformed small
companies internationally in the first half of 1998. In global fixed income
markets, fears that the ongoing Asian crisis would spread to the developed
economies of Europe and the U.S. produced a flight to quality. Government bonds
in Europe, the UK and the U.S. performed well, as have the Fund's holdings in
this asset class.
MARKET REVIEW
The period has been characterized by markedly divergent outcomes in regional
investment performance. Broadly, European equities have been exceptionally
strong, U.S. stocks made further but less spectacular progress, and Asia and
emerging markets rallied feebly before resuming their declines. Government bonds
initially provided low returns but began to outperform stocks toward the end of
the period.
In Europe, euphoria prevails from the impending advent of the euro and
unprecedented merger and acquisition activity, particularly in financial
services. Many of the impediments to cross-border mergers between banks and
insurers will be effectively abolished by a single currency.
Nonetheless, investors should be aware that we regard some of the optimism
surrounding the Euromarkets as excessive, especially those benefiting from, in
our view, inappropriate and artificially low interest rates such as those found
in Spain, Italy, and Ireland. Because we believe inflation problems in these
countries are just a matter of time, we have not exposed the Fund to their
markets.
The U.S. economy grew at an annualized rate of 4.8% in the first quarter, far
above the trend rate, even though inflation remains effectively non-existent.
Corporate profits, meanwhile, continued to grow, driven by another wave of
consolidation in key U.S. sectors, namely banking, telecommunications, and
pharmaceuticals. We believe the U.S. equity market remains cheap, although this
view is contingent on our forecasts for the U.S. bond market proving correct.
Bond markets rose and fell in line with the ebb and flow of the Asian crisis.
Recently, however, because Japan is in recession for the third time this decade,
Asian economies have wilted again. In addition, as Western companies began to
report the first serious Asian profit ramifications, bond markets rallied,
carrying yields down to levels not seen since the 1960s--5.6% in both the U.S.
and the UK.
We expect inflation to remain low in the West, with the exception of some parts
of the European Union. We therefore anticipate valuable real returns from
government bonds and, possibly, a sustained period in which they outperform
equities. We have a strong preference for U.S. bonds, believing that inflation
expectations can only fall from here. We anticipate the U.S. dollar could remain
the world's strongest currency and a haven of safety.
OUTLOOK
Notwithstanding the crisis in Asia, we believe the world investment picture is
improving. Inflation is low and long-term interest rates are finally beginning
to fall, thanks to the recognition of reduced inflation risk. Lower long-term
rates should encourage more growth and opportunities worldwide. Technological
change, meanwhile, is abolishing geographic barriers and improving life
expectancy and living standards.
While we recognize the risk that current rates of equity market returns are
unsustainable, with even a chance of a significant setback, we find no merit in
bearishness. Under current market conditions, we intend to remain invested in a
mix of the world's most blue-chip bond market--the U.S.--and global blue-chip
companies, whose valuations we do not regard as excessive.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE GROWTH & INCOME MSCI WORLD JP MORGAN GLOBAL GOVT.
<S> <C> <C> <C>
10-Feb-93 $10,000 $10,000 $10,000
28-Feb-93 $10,008 $10,102 $10,161
31-Mar-93 $10,228 $10,689 $10,317
30-Apr-93 $10,261 $11,187 $10,505
31-May-93 $10,361 $11,447 $10,572
30-Jun-93 $10,437 $11,352 $10,580
31-Jul-93 $10,673 $11,588 $10,585
31-Aug-93 $11,145 $12,121 $10,898
30-Sep-93 $11,155 $11,899 $11,013
31-Oct-93 $11,460 $12,229 $11,008
30-Nov-93 $11,333 $11,539 $10,928
31-Dec-93 $11,775 $12,106 $11,039
31-Jan-94 $12,135 $12,906 $11,143
28-Feb-94 $11,639 $12,741 $11,021
31-Mar-94 $11,312 $12,194 $10,970
30-Apr-94 $11,467 $12,573 $10,962
31-May-94 $11,355 $12,608 $10,872
30-Jun-94 $11,278 $12,575 $11,000
31-Jul-94 $11,573 $12,816 $11,104
31-Aug-94 $11,721 $13,204 $11,075
30-Sep-94 $11,455 $12,860 $11,130
31-Oct-94 $11,796 $13,228 $11,297
30-Nov-94 $11,394 $12,656 $11,154
31-Dec-94 $11,439 $12,781 $11,180
31-Jan-95 $11,360 $12,592 $11,407
28-Feb-95 $11,580 $12,778 $11,700
31-Mar-95 $11,590 $13,396 $12,296
30-Apr-95 $11,821 $13,866 $12,492
31-May-95 $12,114 $13,987 $12,841
30-Jun-95 $12,059 $13,986 $12,921
31-Jul-95 $12,417 $14,688 $12,982
31-Aug-95 $12,166 $14,363 $12,621
30-Sep-95 $12,471 $14,785 $12,905
31-Oct-95 $12,597 $14,555 $13,031
30-Nov-95 $12,813 $15,063 $13,177
31-Dec-95 $13,211 $15,506 $13,340
31-Jan-96 $13,301 $15,789 $13,203
29-Feb-96 $13,392 $15,888 $13,126
31-Mar-96 $13,410 $16,156 $13,106
30-Apr-96 $13,483 $16,538 $13,057
31-May-96 $13,647 $16,556 $13,071
30-Jun-96 $13,694 $16,642 $13,185
31-Jul-96 $13,602 $16,057 $13,428
31-Aug-96 $13,951 $16,245 $13,484
30-Sep-96 $14,200 $16,884 $13,558
31-Oct-96 $14,653 $17,005 $13,827
30-Nov-96 $15,245 $17,961 $14,024
31-Dec-96 $15,368 $17,676 $13,927
31-Jan-97 $15,247 $17,892 $13,578
28-Feb-97 $15,489 $18,101 $13,484
31-Mar-97 $15,555 $17,746 $13,382
30-Apr-97 $15,649 $18,329 $13,306
31-May-97 $16,295 $19,464 $13,621
30-Jun-97 $16,706 $20,438 $13,775
31-Jul-97 $17,257 $21,382 $13,725
31-Aug-97 $16,516 $19,955 $13,708
30-Sep-97 $17,477 $21,042 $14,012
31-Oct-97 $17,162 $19,938 $14,309
30-Nov-97 $17,315 $20,294 $14,137
31-Dec-97 $17,860 $20,544 $14,122
31-Jan-98 $18,062 $21,120 $14,264
28-Feb-98 $19,108 $22,552 $14,369
31-Mar-98 $19,751 $23,508 $14,262
30-Apr-98 $20,031 $23,741 $14,481
31-May-98 $20,301 $23,447 $14,543
30-Jun-98 $20,611 $24,007 $14,583
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
various indices for the same period. It assumes a hypothetical $10,000 initial
investment in the Fund and reflects all Fund expenses but not expenses and
charges of the separate account. Past performance is no guarantee of future
results.
(1) The MSCI World Index is a market value-weighted average of the performance
of 1,571 securities listed on major world stock exchanges -- the U.S.,
Europe, Canada, Australia, New Zealand and the Far East. It includes the
effect of reinvested dividends and is measured in U.S. dollars.
(2) The JP Morgan Global Government Bond Index is a market value-weighted
average of government bonds from 13 major bond markets. It includes the
effect of reinvested coupons and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
5
<PAGE>
GT GLOBAL
VARIABLE TELECOMMUNICATIONS FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: October 18, 1993
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year 23.06% 17.06%
Life of Fund 18.83% 18.60%
Fund Performance
Average Annualized
1 Year 24.78%
Life of Fund 20.49%
</TABLE>
PERFORMANCE
The Fund performed well, returning 21.69% over the six-month period ended June
30, 1998, compared to a return of 24.44% for the Morgan Stanley Capital
International (MSCI) Telecommunications Index(1) and 23.36% for the Salomon
Brothers Global Telecommunications Index.(2) The MSCI World Index(3) returned
16.85% for the same period.
MARKET REVIEW
The period was marked by a recovery from the effects of the Asian crisis in
several sectors, including North American technology stocks. Initial concerns
about slowing Asian markets were tempered by booming U.S. and European demand
and by the realization that Asian-sourced components' prices would be dropping,
thus reducing the input costs of many equipment assemblers. Some non-Asian
emerging market shares also rebounded as it became apparent that the Asian
crisis did not spell imminent currency devaluation for every emerging market.
Since the beginning of 1998, the Fund has benefited largely from share price
advances of European telecommunications companies. European stocks have rallied
on the back of euphoria over the approach of European Economic and Monetary
Union (EMU). In addition, European telecommunications companies, in particular,
have performed well as a result of the deregulation of the industry that began
in January. Notable European performers included cellular service, wireless
equipment manufacturers and UK cable-TV companies.
We remained underweighted in Asia and had sharply limited exposure to Japan.
While the brunt of Asia's problems hit in the fourth quarter of 1997, we
continued to experience weakness in most of the region's markets throughout the
first half of this year; few, if any, telecom stocks were immune to the Asian
flu.
OUTLOOK
We think there is potential for continued strong results from the newly
deregulated European telecommunications companies in both wireline and wireless
services. We also forecast that wireless equipment will remain strong for the
rest of the year, though we feel handset margins are bound to narrow over time
and may eventually create problems for manufacturers.
We predict that wireless penetration in Europe will continue to expand at a
faster pace than is generally expected by Wall Street analysts. We believe a
quicker pace of penetration could ultimately be seen in North America as well,
but has affected Europe first because of many technical and marketing advantages
conferred by the Global System for Mobile Telecommunications, a single standard
for cellular communications.
We believe industry consolidation will continue in North America and, possibly,
in Europe as well. Even in some of the emerging markets, privatizations and
strategic positions taken by large telecommunications companies may eventually
lead to increased consolidation and rationalization. All of these trends have
the potential to produce higher valuations for telecommunications stocks, from
both premiums paid in the marketplace and improved profitability.
In the U.S. we believe the trend toward full competition is gathering momentum.
Bell Atlantic's pending agreement with the New York Public Utilities Commission
should open the way for state and federal approval of the company's application
to offer long-distance service in New York. While this agreement is not entirely
a template for other states (Bell Atlantic faces much stiffer competition in New
York City than does any other regional Bell in any other city), it does show the
possibility for compromises that could allow Baby Bells to offer long-distance
and data services, which was their original motivation in agreeing to the
Telecom Act of 1996.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE TELECOMMUNICATIONS MSCI WORLD MSCI TELECOMMUNICATIONS SALOMON GLOBAL TELECOM
<S> <C> <C> <C> <C>
10/18/93 $10,000 $10,000 $10,000 $10,000
10/31/93 $10,008 $10,020 $9,995 $10,125
11/30/93 $9,942 $9,455 $9,469 $9,546
12/31/93 $10,892 $9,919 $9,640 $10,170
1/31/94 $11,358 $10,575 $10,078 $10,979
2/28/94 $11,033 $10,440 $9,421 $10,387
3/31/94 $10,167 $9,991 $9,138 $9,823
4/30/94 $10,402 $10,302 $9,449 $9,919
5/31/94 $10,485 $10,330 $9,517 $9,874
6/30/94 $10,226 $10,303 $9,485 $9,783
7/31/94 $10,927 $10,501 $9,783 $10,181
8/31/94 $11,662 $10,819 $10,105 $10,724
9/30/94 $11,562 $10,537 $9,830 $10,414
10/31/94 $11,871 $10,838 $10,062 $10,543
11/30/94 $11,370 $10,370 $9,390 $9,856
12/31/94 $11,670 $10,473 $9,382 $9,675
1/31/95 $11,529 $10,317 $9,610 $9,503
2/28/95 $11,337 $10,470 $9,622 $9,171
3/31/95 $11,345 $10,977 $9,829 $9,598
4/30/95 $11,662 $11,361 $9,975 $9,849
5/31/95 $12,422 $11,461 $10,147 $9,868
6/30/95 $13,422 $11,459 $10,334 $10,036
7/31/95 $14,552 $12,035 $10,600 $10,430
8/31/95 $14,920 $11,769 $10,863 $10,586
9/30/95 $15,399 $12,114 $11,533 $10,874
10/31/95 $14,166 $11,926 $11,420 $10,526
11/30/95 $14,423 $12,342 $11,519 $10,693
12/31/95 $14,432 $12,705 $11,903 $10,931
1/31/96 $14,594 $12,937 $12,136 $11,166
2/29/96 $15,579 $13,018 $12,061 $11,078
3/31/96 $15,476 $13,237 $11,908 $11,058
4/30/96 $17,231 $13,551 $12,317 $11,497
5/31/96 $18,018 $13,565 $12,215 $11,467
6/30/96 $17,746 $13,636 $12,211 $11,551
7/31/96 $16,208 $13,157 $11,419 $10,974
8/31/96 $16,939 $13,311 $11,503 $11,196
9/30/96 $17,024 $13,834 $11,666 $11,337
10/31/96 $16,255 $13,933 $11,925 $11,464
11/30/96 $17,024 $14,717 $12,603 $12,071
12/31/96 $17,223 $14,483 $13,013 $12,464
1/31/97 $18,524 $14,660 $13,375 $12,811
2/28/97 $17,603 $14,831 $13,541 $12,969
3/31/97 $16,673 $14,541 $13,454 $12,886
4/30/97 $16,844 $15,018 $13,718 $13,139
5/31/97 $18,363 $15,948 $14,859 $14,232
6/30/97 $19,243 $16,746 $15,534 $14,878
7/31/97 $21,044 $17,520 $15,806 $15,139
8/31/97 $20,031 $16,351 $14,684 $14,064
9/30/97 $21,897 $17,241 $15,669 $15,008
10/31/97 $20,074 $16,337 $14,940 $14,310
11/30/97 $19,603 $16,628 $16,059 $15,382
12/31/97 $19,731 $16,834 $16,729 $16,023
1/31/98 $19,946 $17,305 $17,569 $16,827
2/28/98 $21,865 $18,479 $18,474 $17,694
3/31/98 $23,774 $19,262 $20,445 $19,582
4/30/98 $23,870 $19,453 $20,085 $19,237
5/31/98 $23,077 $19,212 $19,663 $18,833
6/30/98 $24,012 $19,671 $20,636 $19,765
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
various indices for the same period. It assumes a hypothetical $10,000 initial
investment in the Fund and reflects all Fund expenses but not charges and
expenses of the separate account. Past performance is no guarantee of future
results.
(1) The MSCI Telecommunications Index is a market value-weighted average of the
performance of 35 securities listed on 10 major stock exchanges. It includes
the effect of reinvested dividends and is measured in U.S. dollars.
(2) The Salomon Brothers Global Telecommunications Index is a market
value-weighted average of the performance of 80 securities. It consists of
telecommunications companies with total adjusted market capitalizations of
US$100 million or more, including those in emerging markets. It includes the
effect of reinvested dividends and is measured in U.S. dollars.
(3) The MSCI World Index is a market value-weighted average of the performance
of 1,571 securities listed on major world stock exchanges -- the U.S.,
Europe, Canada, Australia, New Zealand and the Far East. It includes the
effect of reinvested dividends and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
6
<PAGE>
GT GLOBAL
VARIABLE EMERGING MARKETS FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: July 5, 1994
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year -39.01% -42.67%
Life of Fund -5.06% -5.78%
Fund Performance
Average Annualized
1 Year -38.15%
Life of Fund -3.72%
</TABLE>
PERFORMANCE
During the six months to June 30, 1998, sentiment toward emerging markets failed
to recover from the blows dealt by last year's devaluation of the Thai baht.
June was a particularly dismal month for the East Asian newly industrialized
countries, as investors focused on the perceived problems arising from the
falling yen and the impact of the economic contraction taking place in many
countries in the region. Falls in the prices of oil and other commodities also
had an adverse impact on the stock markets of South Africa, Venezuela, Mexico
and Russia. In the case of the latter, investors were also concerned about the
government's fiscal problems.
In this difficult environment, the Fund returned -17.85%. The International
Finance Corporation (IFC) Global Composite Index returned -15.69% over the same
period. On a country selection basis, the Fund performed well against the IFCI
Index. Stock selection, on the other hand, caused the Fund to underperform.
MARKET REVIEW
Market weakness reverberated throughout the Fund's largest positions--Mexico,
Brazil and South Africa. A fall in the price of oil led to a tightening of
Mexico's fiscal policy, which we think may dampen domestic demand. Moreover,
trade accounts have deteriorated somewhat and, as a consequence, we believe the
peso may soften. Against these negative factors, inflation has stabilized,
interest rates could decline from here, and we are able to identify a range of
attractive stocks.
We believe Brazil's economic growth is likely to be constrained by the doubling
in interest rates, to around 40%, and by the latest fiscal package. Much of the
good news about the economic reform program has already been discounted by the
market. Further progress may also be difficult following the deaths of two key
political supporters of President Cardoso. Although we are still overweighted
relative to the index, we have begun to trim our positions somewhat. In terms of
stock selection, we are concentrating on privatization plays.
We have continued to realize profits in South Africa and are currently
underweighted relative to the index. Short-term inflows of capital have boosted
money supply growth with the consequence that bond yields have risen. Most
analysts are recognizing weakness in the economy and revising down their
earnings forecasts. We feel valuations are demanding.
OUTLOOK
In our opinion, the environment in Asia remains very challenging, and we
continue to believe regional stock markets will remain volatile. Thanks in part
to Japan's worsening problems, economic conditions throughout the region
continue to deteriorate. While additional renegotiations of foreign currency
debt will take place later in 1998, authorities have not moved sufficiently to
recapitalize failed banks in the countries most affected by financial crises
over the last year.
Although our outlook for many emerging markets continues to be overshadowed by
events in Asia, we find some selected opportunities in the emerging markets of
Europe, the Middle East and Africa. In particular, we favor Egypt, Israel and
Hungary.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE EMERGING MARKETS IFC GLOBAL COMPOSITE
<S> <C> <C>
05-Jul-94 $10,000 $10,000
31-Jul-94 $10,250 $10,524
31-Aug-94 $10,408 $11,669
30-Sep-94 $11,358 $12,035
31-Oct-94 $11,400 $11,780
30-Nov-94 $10,917 $11,276
31-Dec-94 $10,012 $10,653
31-Jan-95 $9,095 $9,442
28-Feb-95 $8,337 $9,324
31-Mar-95 $8,135 $9,286
30-Apr-95 $8,867 $9,432
31-May-95 $9,406 $9,789
30-Jun-95 $9,398 $9,770
31-Jul-95 $9,886 $9,956
31-Aug-95 $9,381 $9,568
30-Sep-95 $9,356 $9,627
31-Oct-95 $9,103 $9,343
30-Nov-95 $8,724 $9,077
31-Dec-95 $9,257 $9,340
31-Jan-96 $9,896 $9,821
29-Feb-96 $10,381 $9,759
31-Mar-96 $10,857 $9,914
30-Apr-96 $11,699 $10,652
31-May-96 $11,853 $10,447
30-Jun-96 $11,614 $10,600
31-Jul-96 $11,155 $9,939
31-Aug-96 $11,291 $10,160
30-Sep-96 $11,487 $10,251
31-Oct-96 $11,521 $10,022
30-Nov-96 $12,133 $10,166
31-Dec-96 $12,133 $10,076
31-Jan-97 $12,635 $10,753
28-Feb-97 $13,112 $11,242
31-Mar-97 $12,984 $11,041
30-Apr-97 $12,984 $11,043
31-May-97 $13,393 $11,225
30-Jun-97 $13,899 $11,799
31-Jul-97 $14,368 $11,985
31-Aug-97 $12,227 $10,687
30-Sep-97 $12,535 $10,738
31-Oct-97 $10,644 $9,105
30-Nov-97 $10,219 $8,580
31-Dec-97 $10,464 $8,611
31-Jan-98 $9,541 $8,117
28-Feb-98 $10,265 $8,953
31-Mar-98 $10,690 $9,242
30-Apr-98 $10,997 $9,165
31-May-98 $9,496 $8,076
30-Jun-98 $8,596 $7,272
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the index for the same period. It assumes a hypothetical $10,000 initial
investment in the Fund and reflects all Fund expenses but not charges and
expenses of the separate account. Past performance is no guarantee of future
results.
(1) The IFC Global Composite Index is a market value-weighted average of the
performance of securities listed on the exchanges of 26 countries. It
includes the effect of reinvested dividends and are measured in U.S.
dollars.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
7
<PAGE>
GT GLOBAL
VARIABLE INFRASTRUCTURE FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: January 31, 1995
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year 5.83% -0.17%
Life of Fund 13.22% 12.56%
Fund Performance
Average Annualized
1 Year 7.32%
Life of Fund 14.81%
</TABLE>
PERFORMANCE
For the six months ended June 30, 1998, the Fund's total return was 10.47%. Over
the same period, the Morgan Stanley Capital International (MSCI) World Index(1)
returned a total of 16.85%. The index is designed to represent the performance
of all markets, however, and does not reflect the Fund's concentration in
infrastructure industries.
MARKET REVIEW
The past six months saw greatly improved performance for the Fund compared to
the final six months of 1997. Early in 1998, continued fears regarding the
potential spread of Asian currency crises weakened stock market performance
around the world. Additionally, during April and May, a further correction
ensued, as profit warnings led to profit-taking in many markets. But as these
fears subsided, the trend reversed and particular strength was seen in major
European stock markets, alongside a strong U.S. recovery. A recovery in many
cyclical stocks near the close of the reporting period enabled the Fund to
regain much of the ground lost during the period.
In Europe, positive macroeconomic trends of low interest rates, sharp growth and
low valuations compared to the U.S. combined with strong industry and company
fundamentals to result in solid returns for many of the Fund's European holdings
over the review period. Communications, transportation and utility companies did
particularly well. Privatization and deregulation were significant factors here,
and often led to accelerated earnings growth.
North American markets, meanwhile, continued their strong performance over the
period. With low interest rates, relatively high GDP, and inflation held in
check, equity markets rose to new heights. Stock selection remained important,
however, because falling commodity prices and exposure to weak Asian markets
hurt the performance of some North American infrastructure companies.
Asian and Latin American securities remained weak, except for a brief rally
early in January. Although the Fund's weighting in these markets had been
reduced significantly by the end of the period, exposure to these regions had a
negative impact on the Fund's returns from January to March.
OUTLOOK
Continued acceleration of developed country infrastructure spending proved to be
one of the most positive trends during the review period. Once considered to be
mature, with little or no growth prospects, U.S. and European communications,
utility and transportation industries experienced significant spending
increases. The U.S. Congress, for example, passed the Transportation Equity Act
of the 21(st) Century, mandating an increase in spending on highway
infrastructure by approximately 40%--up to an estimated US$180 billion over the
next six years. We believe this trend is sustainable and expect to stay
overweighted in developed markets for the foreseeable future.
On the other hand, we believe share prices of emerging markets companies,
particularly those in Asia and Latin America, will remain lackluster at best in
the near term. Continued currency volatility, high debt levels and social
instability are expected to keep most of these governments from investing
aggressively in their infrastructure. While we will continue to invest in
selected opportunities in both regions, the Fund's weighting is likely to remain
minimal until we feel a sustainable upturn in infrastructure spending has
materialized.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE INFRASTRUCTURE MSCI WORLD
<S> <C> <C>
31-Jan-95 $10,000 $10,000
28-Feb-95 $9,942 $10,148
31-Mar-95 $9,967 $10,639
30-Apr-95 $10,467 $11,012
31-May-95 $10,742 $11,108
30-Jun-95 $11,025 $11,107
31-Jul-95 $11,550 $11,665
31-Aug-95 $11,250 $11,407
30-Sep-95 $11,225 $11,741
31-Oct-95 $10,700 $11,559
30-Nov-95 $10,900 $11,962
31-Dec-95 $11,058 $12,314
31-Jan-96 $11,308 $12,539
29-Feb-96 $11,392 $12,618
31-Mar-96 $11,508 $12,830
30-Apr-96 $12,450 $13,134
31-May-96 $12,925 $13,148
30-Jun-96 $13,033 $13,217
31-Jul-96 $12,608 $12,752
31-Aug-96 $12,925 $12,901
30-Sep-96 $13,181 $13,409
31-Oct-96 $13,038 $13,505
30-Nov-96 $13,508 $14,264
31-Dec-96 $13,809 $14,038
31-Jan-97 $14,262 $14,209
28-Feb-97 $14,120 $14,375
31-Mar-97 $13,860 $14,093
30-Apr-97 $13,759 $14,556
31-May-97 $14,489 $15,458
30-Jun-97 $14,926 $16,231
31-Jul-97 $15,733 $16,981
31-Aug-97 $14,961 $15,848
30-Sep-97 $15,795 $16,711
31-Oct-97 $14,526 $15,834
30-Nov-97 $14,438 $16,117
31-Dec-97 $14,500 $16,316
31-Jan-98 $14,402 $16,773
28-Feb-98 $15,103 $17,910
31-Mar-98 $16,061 $18,669
30-Apr-98 $16,185 $18,855
31-May-98 $15,804 $18,621
30-Jun-98 $16,018 $19,066
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the MSCI World Index for the same period. It assumes a hypothetical $10,000
initial investment in the Fund and reflects all Fund expenses but not expenses
and charges of the separate account. Past performance is no guarantee of future
results.
(1) The MSCI World Index is a market value-weighted average of the performance
of 1,571 securities listed on major world stock exchanges -- the U.S.,
Europe, Canada, Australia, New Zealand and the Far East. It includes the
effect of reinvested dividends and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
8
<PAGE>
GT GLOBAL
VARIABLE NATURAL RESOURCES FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: January 31, 1995
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year -10.21% -15.60%
Life of Fund 11.21% 10.53%
Fund Performance
Average Annualized
1 Year -8.96%
Life of Fund 12.79%
</TABLE>
PERFORMANCE
For the six-month period ending June 30, 1998, the Fund suffered from weakness
in commodity prices across the board, particularly in the energy sector. In the
early part of the year the Fund was heavily weighted in the energy and energy
service sectors, due to improving fundamentals and growth prospects for these
industries. However, the steep decline in petroleum prices greatly reduced the
value of these companies' stocks. Weakness in Asia has also brought commodity
prices to record lows generally. Against this difficult background, the Fund's
total return for the six-month period was -19.42%.
During the same period, the Morgan Stanley Capital International (MSCI) World
Index(1) returned 16.85%. However, because the index is designed to represent
the performance of all markets, it does not reflect the Fund's concentration in
natural resources industries.
MARKET REVIEW
The period of 1997 to 1998 has been most disappointing for natural resources
stocks. At no other time have we seen a resource-laden region such as Asia be
simultaneously hit by drastically unusual weather and economic crisis. The
results have produced the lowest commodity prices in years, accompanied by
devaluation of their corresponding resource companies.
OUTLOOK
We believe demand for resources should grow in the coming year. As the effects
of El Nino and the turmoil in Asia subside, we think demand for commodities
could recover based on the strength of developed world economies. Recovery could
be delayed, however, by uncertainty over the extent of the Asian crisis and the
glut of petroleum production.
Recent events have precipitated a change in our approach to investing in natural
resources companies, and we have undertaken a major realignment of the Fund. In
the past, we have invested on an earnings momentum basis. Although share prices
of natural resources companies are predominantly influenced by commodity prices,
the earnings momentum approach generally does not reflect changes in commodity
prices on a timely basis.
Because the direction of commodity prices also cannot be accurately forecast, we
have found it difficult to produce superior returns. We are now focusing on risk
control and are seeking to substantially reduce volatility by decreasing our
position in any one company and increasing the number of companies we hold.
We are also introducing greater diversity within the natural resources
industries by increasing our exposure to many commodity groups. Additionally,
geographic diversification has been implemented. Specifically, we have reduced
the Fund's exposure to Canada and the U.S. in favor of Europe.
Finally, we are purchasing more conservative companies. Instead of owning small,
high-growth oil and gas companies, for example, we are investing in companies
such as British Petroleum and other larger companies with significantly lessened
price volatility.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE NATURAL RESOURCES MSCI WORLD
<S> <C> <C>
31-Jan-95 $10,000 $10,000
28-Feb-95 $10,050 $10,148
31-Mar-95 $10,375 $10,639
30-Apr-95 $10,683 $11,012
31-May-95 $10,750 $11,108
30-Jun-95 $11,067 $11,107
31-Jul-95 $11,867 $11,665
31-Aug-95 $11,717 $11,407
30-Sep-95 $11,650 $11,741
31-Oct-95 $11,358 $11,559
30-Nov-95 $11,767 $11,962
31-Dec-95 $12,220 $12,314
31-Jan-96 $12,643 $12,539
29-Feb-96 $13,532 $12,618
31-Mar-96 $14,280 $12,830
30-Apr-96 $15,574 $13,134
31-May-96 $16,208 $13,148
30-Jun-96 $15,407 $13,217
31-Jul-96 $14,976 $12,752
31-Aug-96 $16,252 $12,901
30-Sep-96 $17,282 $13,409
31-Oct-96 $17,643 $13,505
30-Nov-96 $18,321 $14,264
31-Dec-96 $18,471 $14,038
31-Jan-97 $18,620 $14,209
28-Feb-97 $16,437 $14,375
31-Mar-97 $15,618 $14,093
30-Apr-97 $15,046 $14,556
31-May-97 $16,375 $15,458
30-Jun-97 $16,560 $16,231
31-Jul-97 $18,316 $16,981
31-Aug-97 $19,358 $15,848
30-Sep-97 $21,646 $16,711
31-Oct-97 $21,340 $15,834
30-Nov-97 $19,099 $16,117
31-Dec-97 $18,710 $16,316
31-Jan-98 $16,598 $16,773
28-Feb-98 $16,987 $17,910
31-Mar-98 $17,348 $18,669
30-Apr-98 $17,515 $18,855
31-May-98 $16,218 $18,621
30-Jun-98 $15,076 $19,066
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the MSCI World Index for the same period. It assumes a hypothetical $10,000
initial investment in the Fund and reflects all Fund expenses but not charges
and expenses of the separate account. Past performance is no guarantee of future
results.
(1) The MSCI World Index is a market value-weighted average of the performance
of 1,571 securities listed on major world stock-exchanges -- the U.S.,
Europe, Canada, Australia, New Zealand and the Far East. It includes the
effect of reinvested dividends and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
9
<PAGE>
GT GLOBAL
VARIABLE AMERICA FUND
TOTAL RETURNS THROUGH JUNE 30, 1998(1)
Inception date: February 10, 1993
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year 29.69% 23.69%
Life of Fund 17.97% 17.88%
Fund Performance
Average Annualized
1 Year 31.50%
Life of Fund 19.63%
</TABLE>
PERFORMANCE
Steady economic growth provided a basis for continued gains in corporate
earnings during the first half of 1998. Additionally, the long-term downward
trend in interest rates created a favorable environment for continuing economic
growth and may lead to further expansion in the earnings multiples investors are
willing to pay. Against this background, the Fund returned a healthy 12.76%.
During the same period, the Russell Midcap Index(2) returned 13.49%.
MARKET REVIEW
This year has seen tremendous volatility not only in individual share prices,
but also in various industry groups and market capitalizations. In the first
half of 1998 we witnessed an ongoing preference for larger capitalization
companies, while smaller cap companies--although showing gains--have again
lagged their larger counterparts. Investors have also shown a tendency to avoid
companies that supply commodity-related items, such as energy products and
semiconductors, as the Asian crisis dampened demand and depressed pricing for
these products. Instead, the focus this year has been on leading growth
companies, either addressing rapidly growing markets such as the Internet or
possessing strong barriers to new entrants.
Though there were some uncertain moments, on balance it was a good period for
investors. Early in the six months, market participants were pessimistic about
the worldwide impact of Asia's currency and market crises. This view dampened
stock performance and increased volatility, and the widely followed Dow Jones
Industrial Average dropped 222 points (2.8%) on January 9. However, as the new
year unfolded, markets shrugged off these difficulties for a time, and the Dow
proceeded to new highs.
Toward the end of the period, a more cautious climate prevailed as it became
obvious that economies in Asia were not going to recover quickly and that the
slowdown in Japan, Asia's major economy, could be prolonged. Markets worldwide
became more volatile and uncertain.
OUTLOOK
We are cautiously optimistic. It is difficult to imagine, given the current
economic background, that interest rates will move. Inflation seems likely to
remain contained as global competition and lower energy costs offset the
inflationary potential of tight labor markets. The Federal Reserve Board has
left rates unchanged for more than a year.
Earnings growth has slowed, but earnings disappointments have tended to be
company specific rather than across the board.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE AMERICA RUSSELL MIDCAP
<S> <C> <C>
10-Feb-93 $10,000 $10,000
28-Feb-93 $10,008 $10,220
31-Mar-93 $9,908 $10,552
30-Apr-93 $9,525 $10,273
31-May-93 $10,150 $10,599
30-Jun-93 $9,817 $10,719
31-Jul-93 $9,992 $10,771
31-Aug-93 $10,308 $11,249
30-Sep-93 $10,417 $11,293
31-Oct-93 $11,108 $11,302
30-Nov-93 $11,225 $11,040
31-Dec-93 $11,467 $11,440
31-Jan-94 $11,650 $11,755
28-Feb-94 $12,033 $11,595
31-Mar-94 $12,275 $11,102
30-Apr-94 $12,502 $11,178
31-May-94 $12,675 $11,193
30-Jun-94 $12,666 $10,861
31-Jul-94 $12,640 $11,234
31-Aug-94 $13,365 $11,767
30-Sep-94 $13,485 $11,479
31-Oct-94 $13,511 $11,567
30-Nov-94 $13,339 $11,057
31-Dec-94 $13,632 $11,200
31-Jan-95 $13,761 $11,430
28-Feb-95 $14,442 $12,022
31-Mar-95 $14,986 $12,366
30-Apr-95 $15,606 $12,553
31-May-95 $16,003 $12,965
30-Jun-95 $17,028 $13,401
31-Jul-95 $17,968 $14,051
31-Aug-95 $18,135 $14,267
30-Sep-95 $18,222 $14,589
31-Oct-95 $17,555 $14,263
30-Nov-95 $18,012 $14,972
31-Dec-95 $17,089 $15,059
31-Jan-96 $17,204 $15,377
29-Feb-96 $17,581 $15,738
31-Mar-96 $17,766 $15,966
30-Apr-96 $19,180 $16,418
31-May-96 $19,294 $16,666
30-Jun-96 $18,574 $16,416
31-Jul-96 $17,424 $15,400
31-Aug-96 $18,338 $16,133
30-Sep-96 $19,581 $16,930
31-Oct-96 $19,592 $17,065
30-Nov-96 $20,445 $18,105
31-Dec-96 $20,260 $17,920
31-Jan-97 $20,599 $18,591
28-Feb-97 $19,037 $18,563
31-Mar-97 $17,402 $17,774
30-Apr-97 $17,752 $18,216
31-May-97 $19,324 $19,545
30-Jun-97 $19,958 $20,184
31-Jul-97 $21,675 $21,868
31-Aug-97 $21,278 $21,631
30-Sep-97 $23,307 $22,865
31-Oct-97 $22,191 $21,976
30-Nov-97 $22,502 $22,499
31-Dec-97 $23,275 $23,120
31-Jan-98 $22,577 $22,685
28-Feb-98 $24,885 $24,459
31-Mar-98 $26,517 $25,618
30-Apr-98 $25,454 $25,682
31-May-98 $23,973 $25,901
30-Jun-98 $26,244 $26,237
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the Russell Midcap Index for the same period. It assumes a hypothetical $10,000
initial investment in the Fund and reflects all Fund expenses but not charges
and expenses of the separate account. Past performance is no guarantee of future
results.
(1) Prior to January 2, 1997, the Fund normally initially focused on companies
having a market capitalization of $2 billion or less at the time of
purchase. The Fund now normally invests primarily in companies having a
market cap of $1 billion to $5 billion at the time of purchase.
(2) The Russell Midcap Index comprises the capitalization-weighted average price
of 800 selected common stocks of medium-size domestic companies. Its
performance includes the effect of reinvested dividends and is measured in
U.S. dollars.
Indices are unmanaged, not available for direct investment and do not incur
sales charges and professional management fees.
10
<PAGE>
GT GLOBAL
VARIABLE NEW PACIFIC FUND(1)
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: February 10, 1993
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year -52.57% -55.41%
Life of Fund -7.09% -7.26%
Fund Performance
Average Annualized
1 Year -51.90%
Life of Fund -5.78%
</TABLE>
PERFORMANCE
Asian companies continued to be ravaged by the economic turbulence that knocked
the region off its feet in spring 1997 and has kept it down through the first
half of 1998. The extent of the turmoil is reflected in the Fund's performance
for the reporting period. Total return for the six-month period to June 30,
1998, was -19.54%. The Morgan Stanley Capital International (MSCI) Pacific
ex-Japan Index(2) returned -16.81% over the same period.
MARKET REVIEW
The first half of 1998 was a time of crisis throughout Asia, and Indonesia was
particularly hard hit. In the face of difficulties adhering to the International
Monetary Fund reform program, the country erupted in social unrest and violent
rioting early in the second quarter. In response, long-time leader President
Suharto stepped down.
Japan, a crucial character in the Pacific's economic story, faced a serious
downturn as well. A major weakening of the Japanese yen during the second
quarter led to another round of currency devaluations across the region.
Over the course of the period, we made several changes that placed the Fund in a
more defensive position. The Fund continued to have no exposure to Indonesia. We
also have minimal exposure in Malaysia because of the possibility of an easing
of monetary policy in the near future, which we believe would be premature and
could have a negative impact on inflation and the ringgit, the local currency.
Additionally, we reduced our exposure in Singapore, expecting further
deterioration in their economy.
We favored Hong Kong because of attractive valuations and currency stability. We
have, however, altered our strategy, cutting back on property developers and
certain mainland China-based companies. Because we are concerned about the
effect of a slowdown in exports and domestic demand in China, we've shifted our
emphasis to more defensive investments such as utilities, which have greater
earnings stability.
We believe Australia offers a relative safe haven, even though it is far from
immune to problems in the rest of the Asia/Pacific region. First quarter
economic growth of 4.9% was stronger than expected. However, weaker export
growth and a depreciating Australian dollar could indicate a slowdown for the
second half of 1998. Australia's domestic consumption remains healthy,
nonetheless, which could help offset the Asian threat.
OUTLOOK
We believe there is long-term growth potential in Asia, despite its current
struggles, but the region's rebound hinges on reform. Much depends on whether
the Japanese and Chinese governments are able to stimulate their domestic
economies. Should the yen continue to weaken, we think other Asian currencies
will feel the pressure, and if demand in Japan remains soft, the recovery of
Asian exports will be hindered.
Another critical issue in the region is the systemic risk in the banking sector,
caused by rising bankruptcies and non-performing loans. Another concern is
inflation, which has risen primarily due to the impact of currency devaluations.
However, we forecast that inflation will begin tapering off beginning in the
spring of 1999, and interest rates may also begin to drop at the same time,
especially if the current account surplus is sustained.
Over the long term, we expect to see slower but more sustainable growth in gross
domestic product. With more open economies, we believe Asia is likely to
experience greater competitiveness and higher efficiency. We expect corporate
governance to improve, with more attention paid to productivity and returns on
equity. As Asia emerges from the crisis, other positives may include a firmer
economic base and stronger banking systems.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE NEW PACIFIC MSCI PACIFIC EX-JAPAN
<S> <C> <C>
10-Feb-93 $10,000 $10,000
28-Feb-93 $10,008 $10,540
31-Mar-93 $10,308 $10,719
30-Apr-93 $10,833 $11,268
31-May-93 $11,258 $11,700
30-Jun-93 $10,892 $11,345
31-Jul-93 $11,308 $11,746
31-Aug-93 $11,692 $12,633
30-Sep-93 $11,808 $12,877
31-Oct-93 $12,425 $14,960
30-Nov-93 $11,992 $14,513
31-Dec-93 $13,392 $17,527
31-Jan-94 $13,425 $17,046
28-Feb-94 $12,900 $16,216
31-Mar-94 $11,808 $14,494
30-Apr-94 $12,174 $15,167
31-May-94 $12,417 $15,668
30-Jun-94 $11,990 $14,974
31-Jul-94 $12,425 $15,763
31-Aug-94 $13,262 $16,822
30-Sep-94 $13,019 $16,381
31-Oct-94 $12,960 $16,645
30-Nov-94 $11,940 $15,311
31-Dec-94 $11,722 $15,075
31-Jan-95 $10,526 $13,774
28-Feb-95 $10,818 $15,061
31-Mar-95 $10,869 $15,219
30-Apr-95 $11,028 $15,421
31-May-95 $11,638 $16,468
30-Jun-95 $11,655 $16,157
31-Jul-95 $12,226 $16,824
31-Aug-95 $11,773 $16,379
30-Sep-95 $11,714 $16,590
31-Oct-95 $11,319 $16,298
30-Nov-95 $11,134 $16,443
31-Dec-95 $11,697 $17,090
31-Jan-96 $13,025 $18,226
29-Feb-96 $13,008 $18,503
31-Mar-96 $12,941 $18,744
30-Apr-96 $13,630 $19,261
31-May-96 $14,269 $19,069
30-Jun-96 $13,875 $18,714
31-Jul-96 $13,467 $17,776
31-Aug-96 $14,232 $18,576
30-Sep-96 $14,351 $19,056
31-Oct-96 $14,461 $19,579
30-Nov-96 $15,295 $20,629
31-Dec-96 $15,320 $20,674
31-Jan-97 $15,609 $20,431
28-Feb-97 $16,051 $20,726
31-Mar-97 $14,946 $19,769
30-Apr-97 $14,138 $19,368
31-May-97 $15,031 $20,578
30-Jun-97 $15,091 $21,033
31-Jul-97 $15,271 $20,982
31-Aug-97 $12,807 $18,075
30-Sep-97 $12,996 $18,696
31-Oct-97 $9,580 $14,734
30-Nov-97 $9,168 $14,274
31-Dec-97 $9,022 $14,316
31-Jan-98 $8,000 $13,436
28-Feb-98 $8,919 $15,508
31-Mar-98 $8,919 $15,329
30-Apr-98 $8,464 $14,263
31-May-98 $7,777 $12,667
30-Jun-98 $7,259 $11,909
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the MSCI Pacific ex-Japan Index for the same period. It assumes a hypothetical
$10,000 initial investment in the Fund and reflects all Fund expenses but not
charges and expenses of the separate account. Past performance is no guarantee
of future results.
(1) On July 5, 1994, the Fund eliminated Japan from its primary investment area.
(2) The MSCI Pacific ex-Japan Index is a market value-weighted average of the
performance of 205 securities listed on five major Pacific Rim stock
exchanges. It includes the effect of reinvested dividends and is measured in
U.S. dollars.
Indices are unmanaged, not available for direct investment and do not include
the effect of sales charges and professional management fees.
11
<PAGE>
GT GLOBAL
VARIABLE EUROPE FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: February 10, 1993
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year 30.74% 24.74%
Life of Fund 18.36% 18.27%
Fund Performance
Average Annualized
1 Year 32.57%
Life of Fund 20.02%
</TABLE>
PERFORMANCE
European markets have been riding high on an unprecedented wave of growth, which
translated into excellent results for the Fund. For the six months ended June
30, 1998, the Fund's total return was 27.86%. In comparison, the Morgan Stanley
Capital International Europe Index returned 26.67% for the same period.(1)
MARKET REVIEW
Economic news has been mostly positive, with low inflation and expanding GDP.
The prospect of European Economic and Monetary Union (EMU) has been one of the
drivers of growth. To participate in EMU, governments are required to meet
strict budgetary guidelines and improve finances. Consequently, economic growth
has increased, interest rates have dropped, and inflation has dipped
dramatically. In January 1999, 11 European countries (excluding the UK) are
expected to join EMU and begin using a single currency, the euro.
Worldwide, other economies contrasted starkly with those of Europe. In Asia, the
economic crisis continued its downward spiral. In the U.S., many investors have
been worried about slower earnings growth and a possible rate hike by the
Federal Reserve Board (the Fed). These concerns generated an influx of cash into
Europe's relatively more attractive markets.
With European economies steaming ahead, European corporations have embraced the
challenge of becoming more globally competitive. Corporations are trimming down,
becoming more efficient, and focusing on ways to add value for shareholders. The
deep structural changes these corporations are making have spurred corporate
profitability and earnings growth.
Consolidation through mergers and acquisitions has also been very widespread.
Many companies are looking ahead to when monetary union will be established.
Rewards to companies that can consolidate their positions and dominate a market
across Europe are potentially far higher than for companies that only maintain
local franchises.
A new culture of investing among Europeans is also contributing to the market
surge. In the past, individual Europeans have been bank savers; now they are
turning to equities. This trend has helped the markets become broader, larger,
and more liquid. Peripheral countries such as Spain and Italy have also had
noteworthy increases in private investment.
OUTLOOK
We believe the Fund is well positioned to take advantage of opportunities in the
European marketplace during the rest of this year. We predict that inflation
will stay subdued and that European economies will strengthen.
Consolidation and restructuring will continue to be key themes. Most European
companies have a long way to go before they can provide the kind of returns
investors expect from U.S. companies. But many companies are committed to
streamlining operations and improving profitability. That makes Europe an
exciting place to watch in the coming years.
We will also be watching EMU long term, to see how markets are affected.
Although we believe the overall effect will be positive, the market may
experience some volatility as the new system is tested.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE EUROPE MSCI EUROPE
<S> <C> <C>
10-Feb-93 $10,000 $10,000
28-Feb-93 $10,008 $10,164
31-Mar-93 $10,133 $10,690
30-Apr-93 $10,525 $10,930
31-May-93 $10,858 $11,051
30-Jun-93 $10,842 $10,893
31-Jul-93 $11,183 $10,934
31-Aug-93 $11,875 $11,897
30-Sep-93 $11,958 $11,864
31-Oct-93 $12,400 $12,362
30-Nov-93 $12,075 $12,099
31-Dec-93 $12,775 $13,011
31-Jan-94 $13,708 $13,677
28-Feb-94 $13,158 $13,196
31-Mar-94 $12,758 $12,826
30-Apr-94 $13,083 $13,361
31-May-94 $12,557 $12,798
30-Jun-94 $12,399 $12,667
31-Jul-94 $12,950 $13,335
31-Aug-94 $13,225 $13,763
30-Sep-94 $12,891 $13,221
31-Oct-94 $13,292 $13,802
30-Nov-94 $12,674 $13,277
31-Dec-94 $12,699 $13,357
31-Jan-95 $12,457 $13,257
28-Feb-95 $12,290 $13,562
31-Mar-95 $11,907 $14,197
30-Apr-95 $12,466 $14,656
31-May-95 $12,783 $14,961
30-Jun-95 $13,033 $15,107
31-Jul-95 $13,598 $15,900
31-Aug-95 $13,362 $15,291
30-Sep-95 $13,842 $15,758
31-Oct-95 $13,673 $15,689
30-Nov-95 $13,699 $15,806
31-Dec-95 $13,926 $16,313
31-Jan-96 $14,264 $16,425
29-Feb-96 $14,904 $16,730
31-Mar-96 $15,621 $16,936
30-Apr-96 $16,211 $17,064
31-May-96 $16,573 $17,201
30-Jun-96 $16,916 $17,397
31-Jul-96 $16,074 $17,185
31-Aug-96 $16,899 $17,701
30-Sep-96 $16,924 $18,079
31-Oct-96 $17,187 $18,505
30-Nov-96 $17,833 $19,449
31-Dec-96 $18,139 $19,831
31-Jan-97 $18,453 $19,891
28-Feb-97 $18,768 $20,159
31-Mar-97 $19,116 $20,817
30-Apr-97 $18,564 $20,719
31-May-97 $18,972 $21,610
30-Jun-97 $20,144 $22,697
31-Jul-97 $20,515 $23,766
31-Aug-97 $19,226 $22,414
30-Sep-97 $20,923 $24,594
31-Oct-97 $20,135 $23,391
30-Nov-97 $20,274 $23,756
31-Dec-97 $20,886 $24,630
31-Jan-98 $21,712 $25,662
28-Feb-98 $23,659 $27,674
31-Mar-98 $25,588 $29,652
30-Apr-98 $26,126 $30,234
31-May-98 $26,423 $30,854
30-Jun-98 $26,706 $31,199
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the MSCI Europe Index for the same period. It assumes a hypothetical $10,000
initial investment in the Fund and reflects all Fund expenses but not charges
and expenses of the separate account. Past performance is no guarantee of future
results.
(1) The MSCI Europe Index is a market value-weighted average of the performance
of 593 securities listed on 14 major European stock exchanges. It includes
the effect of reinvested dividends and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
12
<PAGE>
GT GLOBAL
MONEY MARKET FUND
PERFORMANCE
The Fund's total return for the six months ended June 30, 1998, was 2.39%. As of
June 30, the Fund's SEC seven-day yield was 3.41%. Because the Fund invests only
in short-term debt obligations with remaining maturities of 13 months or less,
its performance generally reflects the level of short-term interest rates.
Please bear in mind that an investment in the Fund is neither insured nor
guaranteed by the U.S. government, and there can be no assurance the Fund will
be able to maintain a stable net asset value of $1.00 per share.
MARKET REVIEW
Fixed income markets continued to be buffeted by overseas turmoil during the
first half of 1998. Early in January, the market was expecting an imminent
reduction in rates by the Federal Reserve Board (the Fed) to counteract negative
effects from the Asian economic crises. However, as it became apparent that the
U.S. economy was going to shrug off the Asian influence and continue its strong
growth, interest rates rose. The one-year Treasury bill, whose yield had dropped
as low as 5.10% in January, backed up to the 5.45% area by late February.
Fueled by low interest rates and strong stock and labor markets, the U.S.
economy continued its solid growth in the first quarter of 1998, rising at a
5.5% annual rate. Despite this rapid growth, inflation remained contained, with
the annualized rate running between 1% and 2%. During the 12 months ended June
30, the Consumer Price Index rose 1.7%. As the second quarter came to a close,
the economy appeared to be finally slowing in response to the Asian influence
and the strike at General Motors. This was confirmed when second quarter GDP was
reported as an increase of 1.4%.
During this period, the Fed remained on watch for signs of incipient inflation,
which never appeared. As the Asia situation continued to unfold, the Fed
remained hesitant to raise rates. As a result, the Federal funds target remained
at 5.5% throughout the reporting period.
OUTLOOK
As the third quarter opened, most market participants were expecting the Fed to
remain on the sidelines for the foreseeable future, though opinion remained
divided about its next move. Some were concerned that strong U.S. growth would
generate inflationary pressures, leading to a tighter Fed policy. Others
remained concerned that Asia's dampening effects on the U.S. would eventually
encourage the Fed to lower rates. With the flat yield curve and all the
uncertainty about the future direction of rates and where the stock market is
headed, Fund managers will continue to maintain the weighted average maturity
toward the shorter end of the spectrum for the foreseeable future.
13
<PAGE>
GT GLOBAL
VARIABLE INTERNATIONAL FUND
TOTAL RETURNS THROUGH JUNE 30, 1998
Inception date: July 5, 1994
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DIVISION PERFORMANCE
AVERAGE WITHOUT WITH APPLICABLE
ANNUALIZED SURRENDER CHARGE SURRENDER CHARGE
<S> <C> <C>
1 Year 7.86% 1.86%
Life of Fund 3.10% 2.41%
Fund Performance
Average Annualized
1 Year 9.38%
Life of Fund 4.57%
</TABLE>
PERFORMANCE
The world's financial markets have been severely tested in recent months by the
barrage of negative news from Asia, with Japan's weakening economy producing
heightened investor concerns throughout the region. Nonetheless, in an
impressive showing, stock prices in Europe continued to climb to record highs
supported by a positive macroeconomic background. The robust nature of European
stock markets and the protracted bull market in the U.S. have been the key
positives in global investing so far in 1998.
In a mixed global environment, the Fund returned 10.58% over the six-month
period ended June 30, 1998. The Morgan Stanley Capital International Europe,
Australia and the Far East (MSCI-EAFE) Index(1) returned 16.08% over the same
period.
Despite the lag in the Fund's returns relative to the index over the shorter
term, the Fund outperformed over the one-year period based on total returns.
Relative to the index over the six-month review period, however, the Fund's
underweighted positions in Germany and Spain, where the Fund had no holdings,
caused the Fund to trail the index. Stock selection in Italy also contributed to
relative underperformance.
MARKET REVIEW
The Fund continues to benefit from a number of factors that have fueled European
markets. While European economies are steaming ahead, European corporations have
embraced the challenge of becoming more globally competitive. Corporations are
trimming down, becoming more efficient, and focusing on ways to add value to
shareholders. The deep structural changes these corporations are making have
spurred corporate profitability and earnings growth.
Meanwhile, conditions remain difficult in Japan; the Fund has continued to
benefit from its underweighted position relative to the index. With the Japanese
banking system in disarray, we firmly believe, as we have for some time, that
political leaders need to shut down insolvent banks and further address the
tremendous number of bad loans. Moreover, the failure of Japanese banks to
provide the necessary amount of capital to get the economy going has
additionally contributed to weakness.
OUTLOOK
In general, we expect to continue focusing on high-quality companies that
provide broad portfolio diversification, with a goal of achieving predictable
and consistent returns.
More specifically, we believe the Fund is well positioned to take advantage of
opportunities in the European marketplace during the rest of this year, where
consolidation and restructuring will continue to be key themes. Most European
companies have a long way to go before they can provide the kind of returns
investors expect from U.S. companies, but many companies are committed to
streamlining operations and improving profitability. We predict inflation will
remain subdued and European economies will strengthen. Long term, we will be
watching European Economic and Monetary Union to see how markets are affected.
The Fund is likely to remain conservatively positioned in Asia, with an
underweighted position in Japan and limited exposure to the rest of the region.
Given the severity of Asia's problems, we expect markets there to remain
volatile.
Despite recent weakness, we continue to be bullish on the outlook for the stock
markets of Australia and New Zealand. We believe corporate profits are set to
recover at a time that equity valuations are relatively attractive. We are,
however, avoiding stocks exposed to the softness in commodity prices.
In Latin America, we continue to maintain an exposure to Brazil where our
current stock selection concentrates on privatization plays. These companies
tend to be less exposed to the economy, which has been sluggish recently, yet
are positively affected by progress on political reform and privatization. We
believe these stocks should also benefit from any further recovery in sentiment
toward the country.
PERFORMANCE SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GT GLOBAL VARIABLE INTERNATIONAL MSCI-EAFE
<S> <C> <C>
05-Jul-94 $10,000 $10,000
31-Jul-94 $10,025 $10,045
31-Aug-94 $10,217 $10,285
30-Sep-94 $9,800 $9,963
31-Oct-94 $10,083 $10,297
30-Nov-94 $9,625 $9,805
31-Dec-94 $9,420 $9,868
31-Jan-95 $8,817 $9,492
28-Feb-95 $8,599 $9,467
31-Mar-95 $8,557 $10,060
30-Apr-95 $8,792 $10,441
31-May-95 $8,750 $10,319
30-Jun-95 $8,913 $10,141
31-Jul-95 $9,374 $10,775
31-Aug-95 $9,240 $10,367
30-Sep-95 $9,391 $10,572
31-Oct-95 $9,081 $10,290
30-Nov-95 $9,089 $10,579
31-Dec-95 $9,313 $11,008
31-Jan-96 $9,456 $11,056
29-Feb-96 $9,473 $11,096
31-Mar-96 $9,600 $11,335
30-Apr-96 $9,795 $11,667
31-May-96 $9,795 $11,455
30-Jun-96 $9,843 $11,522
31-Jul-96 $9,325 $11,188
31-Aug-96 $9,546 $11,216
30-Sep-96 $9,707 $11,517
31-Oct-96 $9,673 $11,402
30-Nov-96 $10,072 $11,858
31-Dec-96 $10,106 $11,708
31-Jan-97 $10,080 $11,301
28-Feb-97 $10,106 $11,489
31-Mar-97 $10,199 $11,533
30-Apr-97 $10,267 $11,597
31-May-97 $10,581 $12,355
30-Jun-97 $10,925 $13,039
31-Jul-97 $11,112 $13,253
31-Aug-97 $10,551 $12,266
30-Sep-97 $11,299 $12,956
31-Oct-97 $10,475 $11,963
30-Nov-97 $10,466 $11,843
31-Dec-97 $10,806 $11,949
31-Jan-98 $10,823 $12,499
28-Feb-98 $11,622 $13,304
31-Mar-98 $12,013 $13,716
30-Apr-98 $12,148 $13,828
31-May-98 $11,851 $13,764
30-Jun-98 $11,949 $13,871
</TABLE>
The chart above shows the performance of the Fund since inception, compared to
the MSCI-EAFE Index for the same period. It assumes a hypothetical $10,000
initial investment in the Fund and reflects all Fund expenses but not charges
and expenses of the separate account. Past performance is no guarantee of future
results.
(1) The MSCI-EAFE is a market value-weighted average of the performance of 1,106
securities listed on 20 major world stock exchanges. It includes the effect
of reinvested dividends and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
14
<PAGE>
GT GLOBAL
ALLOCATOR
FUNDS'
FINANCIAL
STATEMENTS
<PAGE>
GT GLOBAL VARIABLE STRATEGIC INCOME FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Government & Government Agency Obligations (69.9%)
Algeria (1.6%)
Algeria Tranche 1 Loan Assignment, 6.625% due
9/4/06+ ............................................ USD 500,000 $ 386,250 1.6
Argentina (3.3%)
Republic of Argentina:
Global Bond, 11.375% due 1/30/17 .................... USD 351,000 373,991 1.5
Discount Bond, 6.625% due 3/31/23+ .................. USD 280,000 228,375 0.9
Par Bond Series L, 5.75% (6% at 4/99) due
3/31/23++ .......................................... USD 170,000 126,438 0.5
Government Bond, 9.75% due 9/19/27 .................. USD 98,000 90,846 0.4
Australia (1.1%)
Commonwealth of Australia, 7.5% due 9/15/09 ........... AUD 360,000 258,761 1.1
Brazil (4.1%)
Republic of Brazil:
C Bond, 5% (8% at 4/00) due 4/15/14 (Effective rate
at period end is 8%, including "payment-in-kind"
bonds)[.] ++ ....................................... USD 966,455 710,857 2.9
Par Z-L Bond, 5.5% (5.75% at 4/99) due 4/15/24++ .... USD 242,000 171,064 0.7
Debt Conversion Bond Series L, 6.6875% due
4/15/12+ ........................................... USD 173,000 120,668 0.5
Bulgaria (1.1%)
Republic of Bulgaria, Front Loaded Interest Reduction
Bond Series A, 2.25% (2.5% at 7/98) due 7/28/12++ .... USD 428,000 262,685 1.1
Canada (0.9%)
Canadian Government, 8% due 6/1/27 .................... CAD 240,000 221,360 0.9
Colombia (0.9%)
Republic of Colombia, 8.625% due 4/1/08 ............... USD 235,000 223,720 0.9
Denmark (1.9%)
Kingdom of Denmark, 7% due 11/10/24 ................... DKK 2,600,000 459,924 1.9
Ecuador (1.2%)
Ecuador, Past Due Interest Bond, 6.625% due
2/27/15+ ............................................. USD 520,730 300,070 1.2
Germany (10.9%)
Deutschland Republic:
6% due 1/5/06 ....................................... DEM 2,380,000 1,426,918 5.8
5.625% due 1/4/28 ................................... DEM 980,000 564,538 2.3
6.75% due 4/22/03 ................................... DEM 140,000 85,373 0.4
Treuhandanstalt, 7.125% due 1/29/03 ................... DEM 946,000 582,699 2.4
Greece (1.3%)
Hellenic Republic, 9.2% due 3/21/02 ................... GRD 100,000,000 326,108 1.3
Italy (2.6%)
Italian Government, 6.5% due 11/1/27 .................. ITL 820,000,000 525,276 2.1
Italian Buoni Poliennali Del Tesoro (BTPS), 8.5% due
1/1/04 ............................................... ITL 190,000,000 125,989 0.5
Ivory Coast (0.8%)
Ivory Coast:
1.9% due 3/29/18 .................................... FRF 2,000,000 118,276 0.5
2% due 3/29/18 ...................................... USD 200,000 75,500 0.3
Jamaica (0.1%)
Government of Jamaica, 10.875% due 6/10/05 -
144A{.} .............................................. USD 15,000 15,075 0.1
</TABLE>
The accompanying notes are an integral part of the financial statements.
F1
<PAGE>
GT GLOBAL VARIABLE STRATEGIC INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Government & Government Agency Obligations (Continued)
Jordan (0.7%)
Kingdom of Jordan, 5% (5.5% at 12/98) due
12/23/23++ ........................................... USD 250,000 $ 170,000 0.7
Korea (1.0%)
Korea Republic Restructured Debt, 8.281% due
4/8/00+ .............................................. USD 250,000 237,000 1.0
Mexico (0.9%)
United Mexican States, Discount Bond Series B, 6.47656%
due 12/31/19+ +/+ .................................... USD 250,000 225,000 0.9
Netherlands (0.8%)
Netherlands Government Bond, 5.5% due 1/15/28 ......... NLG 400,000 200,216 0.8
New Zealand (1.7%)
New Zealand Government, 8% due 4/15/04 ................ NZD 750,000 413,902 1.7
Panama (0.8%)
Republic of Panama:
Interest Reduction Bond, 3.75% (4% at 7/98) due
7/17/14++ .......................................... USD 125,000 93,125 0.4
8.875% due 9/30/27 .................................. USD 95,000 89,799 0.4
Peru (1.0%)
Republic of Peru, Past Due Interest Bond, 4% (4.5% at
3/99) due 3/7/17++ ................................... USD 412,000 253,380 1.0
Russia (6.5%)
Russian Ministry of Finance:
12.75% due 6/24/28-Reg S{c} ......................... USD 640,000 572,000 2.3
10% due 6/26/07-Reg S{c} ............................ USD 335,000 253,344 1.0
Bank for Foreign Economic Affairs (Venesheconombank)
Principal Loans, 3.31% due 12/15/20+ ................. USD 1,418,458 675,541 2.7
Bank for Foreign Economic Affairs (Venesheconombank)
Interest Notes, 6.63% due 12/15/15+ .................. USD 228,955 127,356 0.5
Sweden (0.8%)
Swedish Government, 6.5% due 10/25/06 ................. SEK 1,500,000 208,094 0.8
United Kingdom (10.0%)
United Kingdom Treasury, 7.5% due 12/7/06 ............. GBP 725,000 1,331,230 5.4
United Kingdom Treasury Conversion, 9.5% due
4/18/05 .............................................. GBP 580,000 1,146,999 4.6
United States (13.3%)
United States Treasury:
8% due 11/15/21{./} ................................. USD 1,160,000 1,495,177 6.0
6.50% due 10/15/06{./} .............................. USD 1,320,000 1,401,159 5.7
6.375% due 8/15/27 .................................. USD 100,000 109,773 0.4
Federal National Mortgage Association, 7.25% due
6/20/02 .............................................. NZD 550,000 283,137 1.2
Venezuela (0.6%)
Republic of Venezuela, 9.25% due 9/15/27 .............. USD 194,000 150,302 0.6
------------
Total Government & Government Agency Obligations (cost
$17,925,559) ............................................. 17,217,295
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F2
<PAGE>
GT GLOBAL VARIABLE STRATEGIC INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Corporate Bonds (19.3%)
Argentina (1.1%)
Telefonica de Argentina, 9.125% due 5/7/08 -
144A{.} .............................................. USD 245,000 $ 233,003 0.9
Mastellone Hermanos S.A., 11.75% due 4/1/08 -
144A{.} .............................................. USD 53,000 53,000 0.2
Brazil (0.7%)
Comtel Brasileira Ltd. "A", 10.75% due 9/26/04 -
144A{.} .............................................. USD 100,000 93,500 0.4
Banco Hipotecario Espana, 10% due 4/17/03 - 144A{.} ... USD 53,000 53,000 0.2
Banco Nacional de Desenvolvimento Economico e Social
(BNDES), 10.3% due 6/16/08 - 144A{.} ................. USD 15,000 14,978 0.1
China (0.3%)
Greater Beijing First, 9.5% due 6/15/07 - 144A{.} ..... USD 100,000 64,000 0.3
Hong Kong (0.6%)
Road King Infrastructure, 9.5% due 7/15/07 -
144A{.} .............................................. USD 100,000 73,060 0.3
GS Superhighway Holdings, 9.875% due 8/15/04 -
144A{.} .............................................. USD 100,000 72,500 0.3
Jamaica (0.2%)
Mechala Group Jamaica:
12.75% due 12/30/99 - Reg S{c} ...................... USD 44,000 40,480 0.2
Korea (0.3%)
Pohang Iron & Steel, 2% due 10/9/00 ................... JPY 8,000,000 48,890 0.2
Korea Development Bank, 4.35% due 5/25/99 ............. JPY 2,200,000 15,672 0.1
Malaysia (0.1%)
Petroliam Nasional Bhd., 7.625% due 10/15/26 -
144A{.} .............................................. USD 27,000 20,254 0.1
Mexico (4.1%)
Petroleos Mexicanos:
9.25% due 3/30/18 - 144A{.} ......................... USD 420,000 388,500 1.6
8.85% due 9/15/07 - 144A{.} ......................... USD 180,000 174,366 0.7
9.5% due 9/15/27 - 144A{.} .......................... USD 162,000 151,470 0.6
Monterrey Power, S.A. de C.V., 9.625% due 11/15/09 -
144A{.} .............................................. USD 193,000 171,770 0.7
Dine, S.A. de C.V., 8.75% due 10/15/07 - 144A{.} ...... USD 90,000 83,700 0.3
Cemex Valenciana, 9.66% due 12/29/49 .................. USD 40,000 38,748 0.2
Philippines (0.2%)
National Power Corp., 9.625% due 5/15/28 .............. USD 65,000 60,152 0.2
Russia (0.5%)
Lukinter Finance BV Convertible, 3.5% due 5/6/02 -
144A{.} .............................................. USD 94,000 84,957 0.3
Mosenergo Finance BV, 8.375% due 10/9/02 - 144A{.} .... USD 67,000 49,245 0.2
United States (11.2%)
United Stationers Supply, 8.375% due 4/15/08 -
144A{.} .............................................. USD 300,000 300,000 1.2
Lenfest Communications, 8.25% due 2/15/08 - 144A{.} ... USD 150,000 154,500 0.6
Unisys Corp., 7.875% due 4/1/08 ....................... USD 150,000 153,750 0.6
Lin Television Corp., 8.375% due 3/1/08 - 144A{.} ..... USD 150,000 153,000 0.6
Chase Manhattan Corp., 6.25% due 1/15/06 .............. USD 152,000 152,719 0.6
Engle Homes, Inc., 9.25% due 2/1/08 ................... USD 150,000 147,750 0.6
General Motors Acceptance Corp., 6.625% due
10/15/05 ............................................. USD 143,000 147,345 0.6
Globalstar LP Capital, 11.375% due 2/15/04 ............ USD 150,000 145,688 0.6
</TABLE>
The accompanying notes are an integral part of the financial statements.
F3
<PAGE>
GT GLOBAL VARIABLE STRATEGIC INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Corporate Bonds (Continued)
Hollywood Casino Corp., 12.75% due 11/1/03 ............ USD 125,000 $ 137,500 0.6
Riddell Sports, Inc., 10.5% due 7/15/07 ............... USD 135,000 136,013 0.6
Trump Atlantic Association Funding, Inc., 11.25% due
5/1/06 ............................................... USD 135,000 130,950 0.5
Smithfield Foods, Inc., 7.625% due 2/15/08 -
144A{.} .............................................. USD 125,000 124,688 0.5
Graham Packaging/GPC Capital, 8.75% due 1/15/08 -
144A{.} .............................................. USD 125,000 124,375 0.5
Drypers Corp. Series B, 10.25% due 6/15/07 ............ USD 90,000 92,925 0.4
ACME Metal, Inc., 10.875% due 12/15/07 - 144A{.} ...... USD 100,000 85,000 0.3
Chancellor Media Corp., 8.125% due 12/15/07 -
144A{.} .............................................. USD 75,000 76,031 0.3
Allbritton Communication, 8.875% due 2/1/08 -
144A{.} .............................................. USD 55,000 59,400 0.2
Eagle Family Foods, 8.75% due 1/15/08 - 144A{.} ....... USD 60,000 58,500 0.2
Penn National Gaming, Inc., 10.625% due 12/15/04 -
144A{.} .............................................. USD 55,000 57,750 0.2
Duane Reade, Inc., 9.25% due 2/15/08 .................. USD 55,000 55,963 0.2
Norampac, Inc., 9.5% due 2/1/08 - 144A{.} ............. USD 55,000 55,825 0.2
Syratech Corp., 11% due 4/15/07 ....................... USD 60,000 55,800 0.2
BTI Telecommunications Corp., 10.5% due 9/15/07 -
144A{.} .............................................. USD 55,000 55,550 0.2
Revlon Consumer Products, 8.625% due 2/2/08 -
144A{.} .............................................. USD 55,000 55,275 0.2
Anker Coal Group, Inc., 9.75% due 10/1/07 - 144A{.} ... USD 55,000 51,150 0.2
Delco Remy International, Inc., 8.625% due 12/15/07 ... USD 40,000 40,800 0.2
Pillowtex Corp., 9% due 12/15/07 - 144A{.} ............ USD 25,000 25,688 0.1
------------
Total Corporate Bonds (cost $5,023,865) ................... 4,819,180
------------
Mortgage Backed (8.9%)
Denmark (1.1%)
Realkredit Danmark, 6% due 10/1/26 .................... DKK 1,944,000 282,565 1.1
United States (7.8%)
Government National Mortgage Association TBA, 7% due
7/15/28{*} ........................................... USD 1,300,000 1,320,719 5.3
Federal National Mortgage Association Pool #313439, 7%
due 3/1/04 ........................................... USD 618,276 626,971 2.5
------------
Total Mortgage Backed (cost $2,201,625) ................... 2,230,255
------------
Consumer Finance (0.7%)
United States (0.7%)
Ford Motor Credit Corp., effective yield 5.25% due
6/16/08 (cost $179,143) .............................. DEM 320,000 176,898 0.7
------------
Structured Notes (0.4%)
Korea (0.4%)
Fixed Rate Trust Certificate 13.55% due 2/15/02 (Issued
by a newly created Delaware Business Trust,
collateralized by triple A paper. This trust
certificate has a credit risk component linked to the
value of a referenced security: Korean Development[::]
(cost $130,000) ..................................... USD 130,000 108,290 0.4
------------ -----
TOTAL FIXED INCOME INVESTMENTS (cost $25,460,192) ......... 24,551,918 99.2
------------ -----
</TABLE>
The accompanying notes are an integral part of the financial statements.
F4
<PAGE>
GT GLOBAL VARIABLE STRATEGIC INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
UNDERLYING VALUE % OF NET
OPTIONS CURRENCY AMOUNT (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Deutsch Marks Put Option, strike 1.8125 expire 7/29/98
(cost $5,115) .......................................... USD 550,000 $ 4,271 --
------------ -----
INDEX OPTIONS
<CAPTION>
PRINCIPAL VALUE % OF NET
SHORT-TERM INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Commercial Paper - Discounted (5.2%)
United States (5.2%)
Ford Motor Credit Corp., effective yield 5.55%, due
7/21/98(cost $1,296,006) ............................. USD 1,300,000 1,296,006 5.2
------------
Government & Government Agency Obligations (2.1%)
Mexico (2.1%)
Mexican Cetes, current yield 27.7% due 12/17/98 ....... MXN 3,350,000 331,074 1.4
Mexican Cetes, current yield 25.8% due 11/19/98 ....... MXN 1,650,000 166,878 0.7
------------
Total Government & Government Agency Obligations (cost
$541,486) ................................................ 497,952
------------ -----
TOTAL SHORT-TERM INVESTMENTS (cost $1,837,492) ............ 1,793,958 7.3
------------ -----
TOTAL INVESTMENTS (cost $27,302,799) * ................... 26,350,147 106.5
Other Assets and Liabilities .............................. (1,605,467) (6.5)
------------ -----
NET ASSETS ................................................ $ 24,744,680 100.0
------------ -----
------------ -----
</TABLE>
- --------------
[::] Certain events may cause the contract to terminate prior to date
shown.
{.} Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
{c} Security issued under Regulation S. Rule 144A and additional
restrictions may apply in the resale of such securities.
+ The coupon rate shown on floating rate note represents the rate at
period end.
++ The coupon rate shown on step-up coupon bond represents the rate at
period end.
[.] Bond pays stated or additional interest with "payment-in-kind"
(PIK) bonds.
+/+ Issued with detachable warrants or value recovery rights. The
current market value of each warrant or right is zero.
{*} Purchased on a forward commitment basis.
{./} All or part of the Fund's holdings in this security is segregated
as collateral for when issued or derivative instruments.
* For Federal income tax purposes, cost is $27,349,282 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 267,838
Unrealized depreciation: (1,266,973)
-------------
Net unrealized depreciation: $ (999,135)
-------------
-------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F5
<PAGE>
GT GLOBAL VARIABLE STRATEGIC INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
<TABLE>
<CAPTION>
MARKET VALUE UNREALIZED
(U.S. CONTRACT DELIVERY APPRECIATION
CONTRACTS TO BUY: DOLLARS) PRICE DATE (DEPRECIATION)
- ---------------------------------------- ------------ ------------ -------- ------------
<S> <C> <C> <C> <C>
Australian Dollars...................... 498,233 1.53713 8/4/98 $ (23,520)
British Pounds.......................... 294,519 0.61153 8/4/98 4,519
British Pounds.......................... 101,986 0.61410 8/4/98 1,986
Deutsche Marks.......................... 786,290 1.78964 8/4/98 (4,153)
Deutsche Marks.......................... 349,511 1.77100 8/4/98 (5,564)
Deutsche Marks.......................... 227,324 1.76460 8/4/98 (4,456)
Deutsche Marks.......................... 69,545 1.78923 8/4/98 (387)
------------ ------------
Total Contracts to Buy (Payable
amount $2,358,983)................. 2,327,408 (31,575)
------------ ------------
THE VALUE OF CONTRACTS TO BUY AS PERCENTAGE OF NET ASSETS IS 9.41%.
CONTRACTS TO SELL:
- ----------------------------------------
Australian Dollars...................... 540,477 1.45560 8/4/98 57,213
Australian Dollars...................... 126,733 1.48862 8/4/98 10,307
Australian Dollars...................... 85,954 1.57227 8/4/98 2,046
British Pounds.......................... 787,187 0.59966 8/4/98 3,255
Canadian Dollars........................ 117,355 1.43807 8/4/98 2,645
Canadian Dollars........................ 99,967 1.42760 8/4/98 3,003
Deutsche Marks.......................... 677,887 1.79360 8/4/98 2,113
Deutsche Marks.......................... 504,671 1.80715 8/4/98 (2,222)
Deutsche Marks.......................... 459,619 1.79770 8/4/98 381
Deutsche Marks.......................... 250,112 1.83600 8/4/98 (5,014)
Deutsche Marks.......................... 220,998 1.80735 8/4/98 (998)
French Francs........................... 63,261 6.00000 10/15/98 73
French Francs........................... 62,761 5.94000 10/15/98 707
Japanese Yen............................ 50,789 122.90000 7/31/98 6,078
Japanese Yen............................ 15,239 121.89997 7/31/98 1,964
New Zealand Dollars..................... 688,564 1.81159 8/4/98 42,835
------------ ------------
Total Contracts to Sell (Receivable
amount $4,875,960)................. 4,751,574 124,386
------------ ------------
THE VALUE OF CONTRACTS TO SELL AS PERCENTAGE OF NET ASSETS IS 19.20%.
Total Open Forward Foreign Currency
Contracts, Net..................... $ 92,811
------------
------------
</TABLE>
- ----------------
See Note 1 to the financial statements.
The accompanying notes are an integral part of the financial statements.
F6
<PAGE>
GT GLOBAL VARIABLE GLOBAL GOVERNMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Government & Government Agency Obligations (74.2%)
Australia (4.4%)
Commonwealth of Australia, 7.5% due 9/15/09 ............. AUD 510,000 $ 366,579 4.4
Canada (2.0%)
Canadian Government, 8% due 6/1/27 ...................... CAD 180,000 166,020 2.0
Denmark (11.6%)
Kingdom of Denmark, 7% due 11/15/07 ..................... DKK 5,800,000 972,157 11.6
Germany (7.6%)
Deutschland Republic:
6.75% due 4/22/03 ..................................... DEM 370,000 225,628 2.7
7.5% due 11/11/04 ..................................... DEM 350,000 224,651 2.7
6% due 1/5/06 ......................................... DEM 305,000 182,861 2.2
Greece (2.3%)
Hellenic Republic, 9.2% due 3/21/02 ..................... GRD 60,000,000 195,665 2.3
Italy (8.6%)
Italian Buoni Poliennali del Tesoro (BTPS):
8.5% due 1/1/04 ....................................... ITL 440,000,000 291,764 3.5
6.5% due 11/1/27 ...................................... ITL 450,000,000 288,261 3.4
9% due 11/1/23 ........................................ ITL 170,000,000 141,440 1.7
Netherlands (1.6%)
Netherlands Government Bond, 5.5% due 1/15/28 ........... NLG 275,000 137,649 1.6
Sweden (3.0%)
Swedish Government, 6.5% due 10/25/06 ................... SEK 1,800,000 249,712 3.0
United Kingdom (12.5%)
United Kingdom Treasury Conversion, 9.5% due 4/18/05 .... GBP 310,000 613,051 7.3
United Kingdom Treasury, 6.75% due 11/26/04 ............. GBP 250,000 432,564 5.2
United States (19.4%)
United States Treasury:
8% due 11/15/21 ....................................... USD 550,000 708,920 8.5
6.50% due 10/15/06 .................................... USD 640,000 679,350 8.1
6.375% due 8/15/27 .................................... USD 100,000 109,773 1.3
Federal National Mortgage Association, 6.375% due
8/15/07 ................................................ AUD 200,000 128,213 1.5
Uruguay (1.2%)
Republic of Uruguay, 7.875% due 7/15/27 - 144A{.} ....... USD 100,000 102,375 1.2
------------
Total Government & Government Agency Obligations (cost
$6,096,155) ................................................ 6,216,633
------------
Mortgage Backed (10.1%)
Denmark (2.8%)
Realkredit Danmark, 6% due 10/1/26 ...................... DKK 1,630,000 236,925 2.8
United States (7.3%)
Government National Mortgage Association:
Pool #462363, 7% due 11/15/27 ......................... USD 268,835 273,077 3.3
Pool #780515, 9.5% due 12/15/21 ....................... USD 101,297 110,065 1.3
Salomon Brothers Mortgage Securities VII Series 1997 -
HUD1 Class AWAC, 6.0867% due 4/25/30 ................... USD 159,340 158,245 1.9
</TABLE>
The accompanying notes are an integral part of the financial statements.
F7
<PAGE>
GT GLOBAL VARIABLE GLOBAL GOVERNMENT INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Mortgage Backed (Continued)
Federal Home Loan Mortgage Association Pool #E62449, 8.5%
due 3/1/10 ............................................. USD 59,045 $ 63,024 0.8
------------
Total Mortgage Backed (cost $835,204) ....................... 841,336
------------
Corporate Bonds (8.1%)
Germany (0.8%)
Kredit Fuer Wiederaufbau International Finance, 7.25% due
7/16/07 ................................................ AUD 100,000 67,327 0.8
Tunisia (2.9%)
Banque Centrais de Tunisie, 8.25% due 9/19/27 ........... USD 250,000 239,872 2.9
United Kingdom (4.4%)
SBC Jersey, 8.75% due 6/20/05 ........................... GBP 200,000 368,659 4.4
------------
Total Corporate Bonds (cost $675,900) ....................... 675,858
------------
Consumer Finance (1.3%)
United States (1.3%)
Ford Motor Credit Corp., effective yield 5.25% due
6/16/08 (cost $106,365) ................................ DEM 190,000 105,033 1.3
------------ -----
TOTAL FIXED INCOME INVESTMENTS (cost $7,713,624) ............ 7,838,860 93.7
------------ -----
<CAPTION>
UNDERLYING VALUE % OF NET
OPTIONS CURRENCY AMOUNT (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Deutsche Marks Put Option, strike 1.8125 expire 7/29/98
(cost $3,162) ............................................ USD 340,000 2,640 --
------------ -----
INDEX OPTIONS
<CAPTION>
PRINCIPAL VALUE % OF NET
SHORT-TERM INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Government & Government Agency Obligations (3.3%)
Mexico (3.3%)
Mexican Cetes, current yield 25.8% due 11/19/98 ......... MXN 1,780,000 180,026 2.1
Mexican Cetes, current yield 27.7% due 12/17/98 ......... MXN 1,000,000 98,829 1.2
------------
Total Government & Government Agency Obligations (cost
$297,361) .................................................. 278,855
------------ -----
TOTAL SHORT-TERM INVESTMENTS (cost $297,361) ................ 278,855 3.3
------------ -----
TOTAL INVESTMENTS (cost $8,014,147) * ...................... 8,120,355 97.0
Other Assets and Liabilities ................................ 247,472 3.0
------------ -----
NET ASSETS .................................................. $ 8,367,827 100.0
------------ -----
------------ -----
</TABLE>
- --------------
{.} Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
* For Federal income tax purposes, cost is $8,019,857 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 187,688
Unrealized depreciation: (87,190)
-------------
Net unrealized appreciation: $ 100,498
-------------
-------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F8
<PAGE>
GT GLOBAL VARIABLE GLOBAL GOVERNMENT INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
<TABLE>
<CAPTION>
MARKET VALUE UNREALIZED
(U.S. CONTRACT DELIVERY APPRECIATION
CONTRACTS TO BUY: DOLLARS) PRICE DATE (DEPRECIATION)
- ------------------------------------------------------------ ------------ -------- -------- --------------
<S> <C> <C> <C> <C>
Australian Dollars.......................................... 170,219 1.53713 8/4/98 $ (8,035)
Australian Dollars.......................................... 136,051 1.49887 8/4/98 (10,059)
British Pounds.............................................. 172,649 0.61153 8/4/98 2,649
British Pounds.............................................. 81,589 0.61410 8/4/98 1,588
Danish Kroner............................................... 158,455 6.73540 8/4/98 (2,783)
Danish Kroner............................................... 97,422 6.67700 8/4/98 (2,578)
Danish Kroner............................................... 59,199 6.76220 8/4/98 (801)
Deutsche Marks.............................................. 398,121 1.78974 8/4/98 (2,103)
Deutsche Marks.............................................. 154,207 1.78923 8/4/98 (858)
Deutsche Marks.............................................. 122,277 1.81200 8/4/98 864
Deutsche Marks.............................................. 40,405 1.80710 8/4/98 177
Deutsche Marks.............................................. 9,274 1.75640 8/4/98 (226)
------------ --------------
Total Contracts to Buy (Payable amount $1,622,033)...... 1,599,868 (22,165)
------------ --------------
THE VALUE OF CONTRACTS TO BUY AS PERCENTAGE OF NET ASSETS IS 19.12%.
CONTRACTS TO SELL:
- ------------------------------------------------------------
Australian Dollars.......................................... 567,191 1.45560 8/4/98 60,040
Australian Dollars.......................................... 188,235 1.48227 8/4/98 16,181
Australian Dollars.......................................... 81,382 1.48862 8/4/98 6,619
Australian Dollars.......................................... 22,465 1.57227 8/4/98 535
British Pounds.............................................. 398,576 0.59966 8/4/98 1,648
Canadian Dollars............................................ 151,651 1.42760 8/4/98 4,555
Canadian Dollars............................................ 10,758 1.43807 8/4/98 243
Danish Kroner............................................... 122,549 6.91780 8/4/98 (1,136)
Danish Kroner............................................... 95,715 6.89100 8/4/98 (518)
Danish Kroner............................................... 74,412 6.88800 8/4/98 (371)
Danish Kroner............................................... 53,840 6.99999 8/4/98 (1,125)
Danish Kroner............................................... 53,256 6.88600 8/4/98 (250)
Danish Kroner............................................... 9,290 6.72410 8/4/98 179
Deutsche Marks.............................................. 351,713 1.80800 8/4/98 (1,713)
Deutsche Marks.............................................. 332,166 1.81100 8/4/98 (2,166)
Deutsche Marks.............................................. 299,751 1.79770 8/4/98 249
Deutsche Marks.............................................. 190,862 1.80735 8/4/98 (862)
Deutsche Marks.............................................. 40,405 1.81740 8/4/98 (405)
Swedish Kronor.............................................. 39,946 7.90310 8/4/98 281
------------ --------------
Total Contracts to Sell (Receivable amount
$3,166,147)............................................ 3,084,163 81,984
------------ --------------
THE VALUE OF CONTRACTS TO SELL AS A PERCENTAGE OF NET ASSETS IS 36.86%.
Total Open Forward Foreign Currency Contracts, Net...... $ 59,819
--------------
--------------
</TABLE>
- ----------------
See Note 1 to the financial statements.
The accompanying notes are an integral part of the financial statements.
F9
<PAGE>
GT GLOBAL VARIABLE U.S. GOVERNMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Government & Government Agency Obligations (62.7%)
United States Treasury:
5.75% due 8/15/03 ..................................... USD 1,300,000 $ 1,314,066 20.3
7.625% due 2/15/25{z} ................................. USD 800,000 1,006,687 15.5
7.00% due 7/15/06 ..................................... USD 500,000 545,918 8.4
5.25% due 1/31/01 ..................................... USD 250,000 248,374 3.8
Tennessee Valley Authority Series A, 6.375% due
6/15/05 ................................................ USD 400,000 413,500 6.4
Student Loan Marketing Assoc., 7.5% due 3/8/00 .......... USD 350,000 359,898 5.6
Federal National Mortgage Association, 6.8% due
1/10/03 ................................................ USD 90,000 93,753 1.4
Financial Assistance Corp., 9.375% due 7/21/03 .......... USD 75,000 86,752 1.3
------------
Total Government & Government Agency Obligations (cost
$3,964,263) ................................................ 4,068,948
------------
Mortgage Backed (26.9%)
Government National Mortgage Association:
TBA Pass Thru Pool, 7% due 7/15/28{*} ................. USD 650,000 660,360 10.2
Pool # 780523, 7.5% due 3/15/08 ....................... USD 249,979 258,025 4.0
Federal National Mortgage Association:
Pool #398668, 6.5% due 9/1/27 ......................... USD 341,189 339,750 5.2
Pool #363939, 7% due 3/1/04 ........................... USD 162,631 164,918 2.5
Pool #356801, 6% due 12/1/08 .......................... USD 118,861 118,202 1.8
Federal Home Loan Mortgage Corp. Series 1462 PL due
7/15/21 ................................................ USD 155,000 158,391 2.4
Salomon Brothers Mortgage Securities VII Series 1997 -
HUD1 Class AWAC,6.0867% due 4/25/30 ................... USD 51,786 51,430 0.8
------------
Total Mortgage Backed (cost $1,735,740) ..................... 1,751,076
------------
Supranational Bonds (8.7%)
International Bank of Reconstruction & Development, 5.25%
due 9/16/03 .............................................. USD 350,000 346,850 5.4
Asian Development Bank, 8% due 4/30/01 .................... USD 200,000 211,378 3.3
------------
Total Supranational Bonds (cost $527,049) ................... 558,228
------------ -----
TOTAL FIXED INCOME INVESTMENTS (cost $6,227,052) ............ 6,378,252 98.3
------------ -----
<CAPTION>
PRINCIPAL VALUE % OF NET
SHORT-TERM INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Commercial Paper - Discounted (10.0%)
American Express Credit Corp., effective yield 5.51%, due
7/21/98 ................................................ USD 375,000 373,852 5.8
John Deere Capital Corp., effective yield 5.51%, due
7/21/98 ................................................ USD 275,000 274,158 4.2
------------
Total Commercial Paper - Discounted (cost $648,010) ......... 648,010
------------ -----
TOTAL SHORT-TERM INVESTMENTS (cost $648,010) ................ 648,010 10.0
------------ -----
</TABLE>
The accompanying notes are an integral part of the financial statements.
F10
<PAGE>
GT GLOBAL VARIABLE U.S. GOVERNMENT INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated June 30, 1998, with State Street Bank & Trust Co.,
due July 1, 1998, for an effective yield of 5.70%,
collateralized by $45,000 U.S. Treasury Notes, 5.875% due
8/31/99 (market value of collateral is $46,017, including
accrued interest). (cost $42,000) ....................... $ 42,000 0.6
------------ -----
TOTAL INVESTMENTS (cost $6,917,062) * ...................... 7,068,262 108.9
Other Assets and Liabilities ................................ (579,235) (8.9)
------------ -----
NET ASSETS .................................................. $ 6,489,027 100.0
------------ -----
------------ -----
</TABLE>
- --------------
{z} All or part of the Fund's holdings in this security is segregated
as collateral for when issued securities. See Note 1 to the
Financial Statements.
{*} Purchased on a forward commitment basis.
* For Federal income tax purposes, cost is $6,925,172 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 152,171
Unrealized depreciation: (9,081)
-------------
Net unrealized appreciation: $ 143,090
-------------
-------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F11
<PAGE>
GT GLOBAL VARIABLE LATIN AMERICA FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Services (29.3%)
Telecomunicacoes Brasileiras S.A. (Telebras): ............. BRZL -- -- 9.5
TELEPHONE NETWORKS
ADR{\/} ................................................. -- 8,340 $ 910,624 --
Common .................................................. -- 7,892,510 627,852 --
Nortel Inversora S.A. - ADR{\/} ........................... ARG 16,200 402,975 2.5
TELEPHONE NETWORKS
Grupo Televisa, S.A. de C.V. - GDR-/- {\/} ................ MEX 10,300 387,538 2.4
BROADCASTING & PUBLISHING
Telefonos de Mexico, S.A. de C.V. "L" - ADR{\/} ........... MEX 7,720 371,043 2.3
TELEPHONE NETWORKS
Companhia de Saneamento Basico do Estado de Sao Paulo -
SABESP ................................................... BRZL 2,647,100 318,156 2.0
BUSINESS & PUBLIC SERVICES
Telefonica de Argentina S.A. - ADR{\/} .................... ARG 7,100 230,306 1.4
TELEPHONE NETWORKS
Cia de Telecomunicaciones de Chile S.A. - ADR{\/} ......... CHLE 11,200 227,500 1.4
TELEPHONE NETWORKS
Controladora Comercial Mexicana, S.A. de C.V. - UBC[.] .... MEX 240,000 199,443 1.2
RETAILERS-FOOD
Telefonica del Peru S.A. - ADR{\/} ........................ PERU 8,700 177,806 1.1
TELEPHONE NETWORKS
Telecomunicacoes de Sao Paulo S.A. (TELESP): .............. BRZL -- -- 1.0
TELEPHONE NETWORKS
Common-/- ............................................... -- 990,000 149,720 --
Preferred ............................................... -- 66,204 15,571 --
Carso Global Telecom "A1" ................................. MEX 44,500 138,799 0.9
TELEPHONE NETWORKS
Telesp Celular S.A.: ...................................... BRZL -- -- 0.6
WIRELESS COMMUNICATIONS
Preferred-/- ............................................ -- 662,676 55,008 --
Common-/- ............................................... -- 1,183,300 50,187 --
Telecomunicacoes do Rio de Janeiro S.A. (TELERJ)
Preferred ................................................ BRZL 1,370,228 103,078 0.6
TELEPHONE NETWORKS
Telerj Celular S.A. "B" Preferred-/- ...................... BRZL 1,370,228 81,503 0.5
WIRELESS COMMUNICATIONS
Cifra, S.A. de C.V. " V" .................................. MEX 46,179 69,446 0.4
RETAILERS-OTHER
Santa Isabel S.A. - ADR{\/} ............................... CHLE 5,317 58,487 0.4
RETAILERS-FOOD
Telepar Celular S.A. "B" Preferred-/- ..................... BRZL 530,000 48,115 0.3
WIRELESS COMMUNICATIONS
Grupo Posadas S.A.: ....................................... MEX -- -- 0.3
LEISURE & TOURISM
"A"-/- .................................................. -- 48,400 29,546 --
"L"-/- .................................................. -- 24,500 14,956 --
El Puerto de Liverpool, S.A. de C.V. ...................... MEX 26,700 40,153 0.2
RETAILERS-OTHER
Cintra S.A. ............................................... MEX 35,600 32,915 0.2
TRANSPORTATION - AIRLINES
Supermercados Unimarc S.A. - ADR-/- {\/} .................. CHLE 2,700 20,588 0.1
RETAILERS-FOOD
------------
4,761,315
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F12
<PAGE>
GT GLOBAL VARIABLE LATIN AMERICA FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Energy (25.2%)
Petroleo Brasileiro S.A. (Petrobras) Preferred ............ BRZL 3,739,000 $ 695,102 4.3
OIL
Centrais Eletricas Brasileiras S.A. (Eletrobras): ......... BRZL -- -- 3.4
ELECTRICAL & GAS UTILITIES
"B" Preferred ........................................... -- 10,158,000 305,662 --
Common-/- ............................................... -- 8,441,830 248,182 --
Companhia Energetica de Minas Gerais (CEMIG) - ADR{\/} .... BRZL 14,984 462,631 2.8
ELECTRICAL & GAS UTILITIES
Enersis S.A. - ADR{\/} .................................... CHLE 14,800 361,675 2.2
ELECTRICAL & GAS UTILITIES
Empresa Nacional de Electricidad S.A. - ADR{\/} ........... CHLE 21,700 309,225 1.9
ELECTRICAL & GAS UTILITIES
Harken Energy Corp.-/- .................................... US 55,900 269,019 1.7
OIL
Light - Servicos de Electricidade S.A. .................... BRZL 837,800 257,172 1.6
ELECTRICAL & GAS UTILITIES
Gener S.A. - ADR{\/} ...................................... CHLE 13,564 247,543 1.5
ELECTRICAL & GAS UTILITIES
Companhia de Eletricidade do Estado da Bahia -
COELBA-/- ................................................ BRZL 4,960,000 184,333 1.1
ELECTRICAL & GAS UTILITIES
YPF S.A. - ADR{\/} ........................................ ARG 5,500 165,344 1.0
ENERGY SOURCES
C.A. La Electricidad de Caracas ........................... VENZ 306,592 138,515 0.9
ELECTRICAL & GAS UTILITIES
Companhia Brasileira de Petroleo Ipiranga S.A.
Preferred ................................................ BRZL 14,594,000 133,258 0.8
OIL
Eletropaulo Metropolitana Preferred-/- .................... BRZL 1,336,370 100,531 0.6
ELECTRICAL & GAS UTILITIES
Perez Companc S.A. "B" .................................... ARG 18,049 90,615 0.6
OIL
Companhia Paulista de Forca e Luz ......................... BRZL -- -- 0.3
ELECTRICAL & GAS UTILITIES
Common .................................................. -- 430,000 43,877 --
Preferred ............................................... -- 1,832 167 --
Companhia Paranaense de Energia - Copel ................... BRZL 4,050,000 31,868 0.2
ELECTRICAL & GAS UTILITIES
Centrais Geradoras do Sul do Brasil S.A. (Gerasul): ....... BRZL -- -- 0.2
ELECTRICAL & GAS UTILITIES
Preferred-/- ............................................ -- 10,158,000 14,668 --
Common-/- ............................................... -- 8,441,830 11,533 --
Empresa Bandeirante de Energia S.A.-/- .................... BRZL 1,336,370 21,146 0.1
ELECTRICAL & GAS UTILITIES
Empresa Paulista de Transmissao de Energia Eletrica-/- .... BRZL 1,336,370 4,726 --
ELECTRICAL & GAS UTILITIES
Empresa Metropolitana de Aguas e Energia S.A.-/- .......... BRZL 1,336,370 1,040 --
ELECTRICAL & GAS UTILITIES
------------
4,097,832
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F13
<PAGE>
GT GLOBAL VARIABLE LATIN AMERICA FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Materials/Basic Industry (14.5%)
Kimberly-Clark de Mexico, S.A. de C.V. "A" ................ MEX 164,700 $ 582,514 3.6
PAPER/PACKAGING
Apasco, S.A. de C.V. ...................................... MEX 66,600 352,030 2.2
CEMENT
Companhia Vale do Rio Doce Preferred ...................... BRZL 17,000 338,089 2.1
METALS - STEEL
Sociedad Quimica y Minera de Chile S.A. - ADR{\/} ......... CHLE 8,400 281,400 1.7
CHEMICALS
Industrias Penoles S.A. (CP) .............................. MEX 58,600 186,042 1.1
METALS - NON-FERROUS
Grupo Cementos de Chihuahua, S.A. de C.V. "B" ............. MEX 128,500 109,362 0.7
CEMENT
Siderca S.A. "A" .......................................... ARG 54,500 92,659 0.6
METALS - STEEL
Votorantim Celulose e Papel S.A. .......................... BRZL 5,700,000 87,237 0.5
PAPER/PACKAGING
Usinas Siderurgicas de Minas Gerais S.A. - USIMINAS ....... BRZL 15,300 78,054 0.5
METALS - STEEL
Caemi Mineracao e Metalurgia S.A. Preferred ............... BRZL 1,306,000 75,638 0.5
METALS - STEEL
Compania de Minas Buenaventura S.A. - ADR{\/} ............. PERU 4,900 64,313 0.4
METALS - NON-FERROUS
Corporacion Venezolana de Cementos, S.A.C.A.: ............. VENZ -- -- 0.3
CEMENT
"A" ..................................................... -- 30,344 30,190 --
"B" ..................................................... -- 14,129 14,569 --
Grupo Mexico S.A. "B" ..................................... MEX 15,000 41,105 0.3
METALS - NON-FERROUS
Siderar S.A.I.C. "A" ...................................... ARG 1,900 7,221 --
METALS - STEEL
------------
2,340,423
------------
Finance (12.7%)
Uniao de Bancos Brasileiros S.A. (Unibanco) Units{=} ...... BRZL 7,845,500 464,014 2.8
BANKS-MONEY CENTER
Banco Rio de La Plata S.A. - ADR{\/} ...................... ARG 23,900 252,442 1.5
BANKS-MONEY CENTER
Banco de A. Edwards - ADR{\/} ............................. CHLE 17,300 245,444 1.5
BANKS-MONEY CENTER
Administradora de Fondos de Pensiones Provida S.A. -
ADR{\/} .................................................. CHLE 13,181 219,958 1.3
INVESTMENT MANAGEMENT
Banco Frances del Rio de la Plata S.A. - ADR{\/} .......... ARG 7,600 174,325 1.1
BANKS-MONEY CENTER
Credicorp Ltd. - ADR{\/} .................................. PERU 11,440 168,025 1.0
BANKS-MONEY CENTER
Grupo Financiero Banorte, S.A. de C.V. "B"-/- ............. MEX 132,000 147,042 0.9
BANKS-MONEY CENTER
Grupo Financiero Banamex Accival, S.A. de C.V. "B"-/- ..... MEX 58,300 113,652 0.7
BANKS-MONEY CENTER
</TABLE>
The accompanying notes are an integral part of the financial statements.
F14
<PAGE>
GT GLOBAL VARIABLE LATIN AMERICA FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Finance (Continued)
Inversiones y Representaciones S.A. (IRSA) - GDR{\/} ...... ARG 3,217 $ 93,695 0.6
REAL ESTATE
Banco LatinoAmericano de Exportaciones S.A. (Bladex)
"E"{\/} .................................................. PAN 2,713 83,425 0.5
OTHER FINANCIAL
Banco BHIF - ADR{\/} ...................................... CHLE 4,817 71,954 0.4
BANKS-MONEY CENTER
Banco Wiese - ADR{\/} ..................................... PERU 11,900 40,906 0.3
BANKS-MONEY CENTER
Grupo Financiero Bancomer, S.A. de C.V. "B" ............... MEX 51,400 19,181 0.1
INVESTMENT MANAGEMENT
------------
2,094,063
------------
Consumer Non-Durables (7.9%)
Fomento Economico Mexicano, S.A. de C.V. - ADR{\/} ........ MEX 16,300 513,450 3.1
BEVERAGES - NON-ALCOHOLIC
Compania Cervecerias Unidas S.A. - ADR{\/} ................ CHLE 12,600 266,175 1.6
BEVERAGES - ALCOHOLIC
Grupo Industrial Maseca, S.A. de C.V. "B" ................. MEX 304,700 221,983 1.4
FOOD
Pepsi-Gemex S.A. - GDR-/- {\/} ............................ MEX 11,200 135,100 0.8
BEVERAGES - NON-ALCOHOLIC
Companhia de Tecidos Norte de Minas Preferred ............. BRZL 561,000 84,890 0.5
TEXTILES & APPAREL
Quilmes Industrial S.A. - ADR{\/} ......................... ARG 6,300 61,425 0.4
BEVERAGES - ALCOHOLIC
Embotelladora Andina S.A. - ADR{\/} ....................... CHLE 1,200 21,000 0.1
BEVERAGES - NON-ALCOHOLIC
Mavesa S.A. - ADR{\/} ..................................... VENZ 2,080 6,630 --
FOOD
Sudamtex de Venezuela "B" - ADR{\/} ....................... VENZ 2,239 5,318 --
TEXTILES & APPAREL
Cerveceria Backus & Johnston S.A. "T" ..................... PERU 6,244 3,190 --
BEVERAGES - ALCOHOLIC
------------
1,319,161
------------
Multi-Industry/Miscellaneous (7.5%)
Grupo Carso, S.A. de C.V. "A1" ............................ MEX 83,800 347,261 2.1
MULTI-INDUSTRY
Alfa, S.A. de C.V. "A" .................................... MEX 79,800 326,240 2.0
CONGLOMERATE
Itausa Investimentos Itau S.A. Preferred .................. BRZL 374,325 236,280 1.4
MULTI-INDUSTRY
Desc, S.A. de C.V. - ADR{\/} .............................. MEX 8,100 160,988 1.0
CONGLOMERATE
Sanluis Corporacion, S.A. de C.V. ......................... MEX 39,700 154,784 1.0
CONGLOMERATE
------------
1,225,553
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F15
<PAGE>
GT GLOBAL VARIABLE LATIN AMERICA FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Capital Goods (1.0%)
Corporacion GEO, S.A. de C.V. "B"-/- ...................... MEX 26,000 $ 145,394 0.9
CONSTRUCTION
ARA, S.A. de C.V.-/- ...................................... MEX 4,600 14,630 0.1
CONSTRUCTION
------------
160,024
------------
Consumer Durables (0.5%)
Brasmotor S.A. Preferred .................................. BRZL 815,800 74,773 0.5
APPLIANCES & HOUSEHOLD DURABLES
------------ -----
TOTAL EQUITY INVESTMENTS (cost $20,523,006) ................. 16,073,144 98.6
------------ -----
<CAPTION>
PRINCIPAL
AMOUNT
--------
<S> <C> <C> <C> <C>
Corporate Bonds (0.0%)
Brazil (0.0%)
Companhia Vale do Rio Doce - Non Convertible (cost
$0) .................................................... BRL 20,000 -- --
------------ -----
<CAPTION>
REPURCHASE AGREEMENT
- -------------------------------------------------------------
<S> <C> <C> <C> <C>
Dated June 30, 1998, with State Street Bank & Trust Co.,
due July 1, 1998, for an effective yield of 5.70%,
collateralized by $135,000 U.S. Treasury Bills, 5.875% due
1/31/99 (market value of collateral is $138,544, including
accrued interest). (cost $133,000) ....................... 133,000 0.8
------------ -----
TOTAL INVESTMENTS (cost $20,656,006) * ..................... 16,206,144 99.4
Other Assets and Liabilities ................................ 98,374 0.6
------------ -----
NET ASSETS .................................................. $ 16,304,518 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
{\/} U.S. currency denominated.
{=} Each unit represents one preferred share of Unibanco and one
preferred "B" share of Unibanco Holdings.
[.] Each unit represents 3 "B" shares and 1 "C" share.
* For Federal income tax purposes, cost is $20,672,231 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 214,653
Unrealized depreciation: (4,680,740)
-------------
Net unrealized depreciation: $ (4,466,087)
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depositary Receipt
GDR--Global Depositary Receipt
The accompanying notes are an integral part of the financial statements.
F16
<PAGE>
GT GLOBAL VARIABLE LATIN AMERICA FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1998, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET
ASSETS {D}
---------------------
SHORT-TERM
&
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY OTHER TOTAL
- -------------------------------------- ------ ----- -----
<S> <C> <C> <C>
Argentina (ARG/ARS) .................. 9.7 9.7
Brazil (BRZL/BRL) .................... 38.7 38.7
Chile (CHLE/CLP) ..................... 14.1 14.1
Mexico (MEX/MXN) ..................... 29.9 29.9
Panama (PAN/PND) ..................... 0.5 0.5
Peru (PERU/PES) ...................... 2.8 2.8
United States (US/USD) ............... 1.7 1.4 3.1
Venezuela (VENZ/VEB) ................. 1.2 1.2
------ ----- -----
Total ............................... 98.6 1.4 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $16,304,518.
The accompanying notes are an integral part of the financial statements.
F17
<PAGE>
GT GLOBAL VARIABLE GROWTH & INCOME FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Finance (32.2%)
UBS AG - Registered ..................................... SWTZ 9,487 $ 3,530,367 6.1
BANKS-MONEY CENTER
Credit Suisse Group ..................................... SWTZ 8,320 1,852,732 3.2
BANKS-MONEY CENTER
AEGON N.V. .............................................. NETH 17,484 1,522,367 2.6
INSURANCE-LIFE
ABN AMRO Holdings N.V. .................................. NETH 53,642 1,256,080 2.2
BANKS-MONEY CENTER
Royal & Sun Alliance Insurance Group PLC ................ UK 108,531 1,122,641 1.9
INSURANCE - MULTI-LINE
CGU PLC ................................................. UK 59,916 1,118,485 1.9
INSURANCE - MULTI-LINE
First Tennessee National Corp. .......................... US 33,400 1,054,188 1.8
BANKS-REGIONAL
Fortis Amev N.V. ........................................ NETH 16,990 995,429 1.7
OTHER FINANCIAL
ING Groep N.V. .......................................... NETH 14,138 926,398 1.6
BANKS-MONEY CENTER
American General Corp. .................................. US 11,950 850,691 1.5
INSURANCE-LIFE
Kredietbank N.V. ........................................ BEL 6,800 609,037 1.1
BANKS-REGIONAL
Lloyds TSB Group PLC .................................... UK 41,571 582,022 1.0
BANKS-REGIONAL
National Australia Bank Ltd. ............................ AUSL 37,500 495,933 0.9
BANKS-REGIONAL
Fortis AG: .............................................. BEL -- -- 0.9
OTHER FINANCIAL
Common ................................................ -- 1,934 494,164 --
Strip VVPR-/- ......................................... -- 1,934 104 --
CVG-/- ................................................ -- 1,934 -- --
National Westminster Bank PLC ........................... UK 27,000 482,835 0.8
BANKS-MONEY CENTER
Commonwealth Bank of Australia .......................... AUSL 35,500 415,261 0.7
BANKS-SUPER REGIONAL
IKB Deutsche Industriebank AG ........................... GER 19,890 410,882 0.7
BANKS-REGIONAL
M & G Group PLC ......................................... UK 13,244 357,692 0.6
INVESTMENT MANAGEMENT
Reinsurance Australia Corporation Ltd. .................. AUSL 80,100 205,000 0.4
INSURANCE - MULTI-LINE
General Property Trust .................................. AUSL 108,000 175,016 0.3
REAL ESTATE
Infrastructure Trust of Australia Group ................. AUSL 204,600 160,064 0.3
OTHER FINANCIAL
------------
18,617,388
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F18
<PAGE>
GT GLOBAL VARIABLE GROWTH & INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Consumer Non-Durables (15.4%)
Diageo PLC .............................................. UK 124,151 $ 1,471,819 2.6
BEVERAGES - ALCOHOLIC
Cadbury Schweppes PLC ................................... UK 82,255 1,273,861 2.2
BEVERAGES - NON-ALCOHOLIC
Reckitt & Colman PLC .................................... UK 53,816 1,027,976 1.8
HOUSEHOLD PRODUCTS
Pernod Ricard ........................................... FR 12,570 871,242 1.5
BEVERAGES - ALCOHOLIC
Brown-Forman Corp. "B" .................................. US 12,855 825,934 1.4
BEVERAGES - ALCOHOLIC
Avon Products, Inc. ..................................... US 9,600 744,000 1.3
PERSONAL CARE/COSMETICS
Clorox Co. .............................................. US 7,064 673,725 1.2
HOUSEHOLD PRODUCTS
Anheuser-Busch Cos., Inc. ............................... US 12,582 593,713 1.0
BEVERAGES - ALCOHOLIC
Kellogg Co. ............................................. US 14,634 549,690 1.0
FOOD
Philip Morris Cos., Inc. ................................ US 13,450 529,594 0.9
TOBACCO
Foster's Brewing Group Ltd. ............................. AUSL 117,900 278,170 0.5
BEVERAGES - ALCOHOLIC
------------
8,839,724
------------
Energy (10.9%)
Royal Dutch Petroleum Co. ............................... NETH 21,160 1,174,168 2.0
OIL
Exxon Corp. ............................................. US 11,940 851,471 1.5
OIL
Shell Transport & Trading Co., PLC ...................... UK 95,688 674,242 1.2
OIL
VEBA AG ................................................. GER 9,980 671,624 1.2
ELECTRICAL & GAS UTILITIES
Mobil Corp. ............................................. US 7,300 559,359 1.0
OIL
Reunies Electrobel & Tractebel S.A. ..................... BEL 3,815 559,219 1.0
ELECTRICAL & GAS UTILITIES
Electrabel S.A. ......................................... BEL 1,880 533,459 0.9
ELECTRICAL & GAS UTILITIES
RWE AG .................................................. GER 8,170 483,893 0.8
ELECTRICAL & GAS UTILITIES
Elf Aquitaine ........................................... FR 2,980 419,010 0.7
OIL
Groupe Bruxelles Lambert S.A. ........................... BEL 1,680 339,344 0.6
OIL
------------
6,265,789
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F19
<PAGE>
GT GLOBAL VARIABLE GROWTH & INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Services (7.7%)
EMI Group PLC ........................................... UK 87,790 $ 768,108 1.3
LEISURE & TOURISM
McGraw-Hill, Inc. ....................................... US 8,880 724,275 1.3
BROADCASTING & PUBLISHING
Reuters Group PLC ....................................... UK 54,868 627,560 1.1
BROADCASTING & PUBLISHING
Elsevier N.V. ........................................... NETH 37,150 561,051 1.0
BROADCASTING & PUBLISHING
Telecom Corporation of New Zealand Ltd. ................. NZ 113,200 467,375 0.8
TELEPHONE NETWORKS
Qantas Airways Ltd. ..................................... AUSL 208,000 313,821 0.5
TRANSPORTATION - AIRLINES
TABCORP Holdings Ltd. ................................... AUSL 46,600 238,700 0.4
LEISURE & TOURISM
Royal PTT Nederland N.V. ................................ NETH 5,915 227,836 0.4
TELEPHONE NETWORKS
Telstra Corp. Ltd. - Installment Receipts ............... AUSL 76,400 196,384 0.3
TELEPHONE NETWORKS
Dun & Bradstreet Corp. .................................. US 4,800 173,400 0.3
BROADCASTING & PUBLISHING
TNT Post Group N.V.-/- .................................. NETH 5,915 151,309 0.3
TRANSPORTATION - SHIPPING
------------
4,449,819
------------
Health Care (3.8%)
Bristol Myers Squibb Co. ................................ US 13,450 1,545,909 2.7
PHARMACEUTICALS
Bayer AG ................................................ GER 12,500 647,460 1.1
PHARMACEUTICALS
------------
2,193,369
------------
Capital Goods (3.0%)
Lockheed Martin Corp. ................................... US 16,566 1,753,925 3.0
------------
AEROSPACE/DEFENSE
Materials/Basic Industry (2.7%)
BASF AG ................................................. GER 12,870 612,024 1.1
CHEMICALS
Akzo Nobel N.V. ......................................... NETH 2,569 571,479 1.0
CHEMICALS
Solvay S.A. "A" ......................................... BEL 3,760 298,332 0.5
CHEMICALS
Aberfoyle Ltd. .......................................... AUSL 45,130 71,453 0.1
METALS - NON-FERROUS
------------
1,553,288
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F20
<PAGE>
GT GLOBAL VARIABLE GROWTH & INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Multi-Industry/Miscellaneous (0.3%)
Orica Ltd. .............................................. AUSL 29,200 $ 173,140 0.3
MULTI-INDUSTRY
------------ -----
TOTAL EQUITY INVESTMENTS (cost $28,356,055) ............... 43,846,442 76.0
------------ -----
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Government & Government Agency Obligations (16.4%)
Canada (0.9%)
Canadian Government, 8.75% due 12/1/05 ................ CAD 657,000 538,162 0.9
Germany (2.5%)
Deutschland Republic:
6.25% due 1/4/24 .................................... DEM 1,310,000 819,295 1.4
6.25% due 4/26/06 ................................... DEM 1,080,000 658,050 1.1
Italy (1.1%)
Italian Buoni Poliennali del Tesoro (BTPS), 6% due
2/15/00 .............................................. ITL 1,125,000,000 648,702 1.1
New Zealand (0.3%)
New Zealand Government, 8% due 4/15/04 ................ NZD 253,000 139,623 0.3
United Kingdom (1.7%)
United Kindgom Treasury, 6% due 12/7/28 ............... GBP 550,000 995,836 1.7
United States (9.9%)
United States Treasury:
5.5% due 2/15/08 .................................... USD 2,525,000 2,522,534 4.4
6% due 2/15/26 ...................................... USD 2,079,000 2,162,241 3.8
5.625% due 2/28/01 .................................. USD 960,000 962,250 1.7
------------
Total Government & Government Agency Obligations (cost
$9,187,808) .............................................. 9,446,693
------------
Corporate Bonds (0.7%)
Germany (0.0%)
IKB Deutsche Industriebank, 6.45% due 3/31/06 ......... DEM 1,500 925 --
United Kingdom (0.7%)
Daily Mail & General Trust, Convertible Bond, 5.75% due
9/26/03 .............................................. GBP 167,000 401,202 0.7
------------
Total Corporate Bonds (cost $304,364) ..................... 402,127
------------ -----
TOTAL FIXED INCOME INVESTMENTS (cost $9,492,172) .......... 9,848,820 17.1
------------ -----
<CAPTION>
NO. OF VALUE % OF NET
WARRANTS COUNTRY WARRANTS (NOTE 1) ASSETS
- ----------------------------------------------------------- -------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Societe Generale Banque Put Warrants due 11/15/99
Tractebel (cost $0) .................................... BEL 763 267 --
------------ -----
BANKS-MONEY CENTER
</TABLE>
The accompanying notes are an integral part of the financial statements.
F21
<PAGE>
GT GLOBAL VARIABLE GROWTH & INCOME FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ----------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated June 30, 1998, with State Street Bank & Trust Co.,
due July 1, 1998, for an effective yield of 5.70%,
collateralized by $4,260,000 U.S. Treasury Notes, 5.875%
due 8/31/99 (market value of collateral is $4,356,285,
including accrued interest). (cost $4,266,000) ......... $ 4,266,000 7.4
------------ -----
TOTAL INVESTMENTS (cost $42,114,227) * ................... 57,961,529 100.5
Other Assets and Liabilities .............................. (291,212) (0.5)
------------ -----
NET ASSETS ................................................ $ 57,670,317 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
* For Federal income tax purposes, cost is $42,117,402 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 16,352,838
Unrealized depreciation: (508,711)
-------------
Net unrealized appreciation: $ 15,844,127
-------------
-------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1998, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS {D}
-------------------------------------------
FIXED INCOME
& SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY WARRANTS & OTHER TOTAL
- -------------------------------------- ------ ------------- ---------- -----
<S> <C> <C> <C> <C>
Australia (AUSL/AUD) ................. 4.7 4.7
Belgium (BEL/BEF) .................... 5.0 5.0
Canada (CAN/CAD) ..................... 0.9 0.9
France (FR/FRF) ...................... 2.2 2.2
Germany (GER/DEM) .................... 4.9 2.5 7.4
Italy (ITLY/ITL) ..................... 1.1 1.1
Netherlands (NETH/NLG) ............... 12.8 12.8
New Zealand (NZ/NZD) ................. 0.8 0.3 1.1
Switzerland (SWTZ/CHF) ............... 9.3 9.3
United Kingdom (UK/GBP) .............. 16.4 2.4 18.8
United States (US/USD) ............... 19.9 9.9 6.9 36.7
------ ----- ----- -----
Total ............................... 76.0 17.1 6.9 100.0
------ ----- ----- -----
------ ----- ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $57,670,317.
The accompanying notes are an integral part of the financial statements.
F22
<PAGE>
GT GLOBAL VARIABLE TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Telephone Networks (20.6%)
Telecom Italia SpA - Di Risp .............................. ITLY 617,093 $ 3,004,863 4.0
SPT Telecom-/- ............................................ CZCH 165,700 2,287,581 3.0
Cable & Wireless PLC - ADR{\/} ............................ UK 60,000 2,212,500 2.9
NTL, Inc.-/- {\/} ......................................... UK 32,000 1,712,000 2.3
Portugal Telecom S.A. - ADR{\/} ........................... PORT 22,000 1,164,625 1.5
WorldCom, Inc.-/- ......................................... US 23,000 1,114,063 1.5
Telefonica de Espana ...................................... SPN 17,300 800,111 1.1
Helsingin Puhelin Oyj (Helsinki Telephone Corp.) .......... FIN 13,138 611,650 0.8
Magyar Tavkozlesi Rt. ..................................... HGRY 100,000 581,262 0.8
Carso Global Telecom "A1" ................................. MEX 185,900 579,837 0.8
BCE, Inc. ................................................. CAN 10,034 425,100 0.6
Telecom Corporation of New Zealand Ltd. - Installment
Receipts ................................................. NZ 133,500 285,313 0.4
Telecommunicacoes Brasileiras S.A. (Telebras) ............. BRZL 3,340,000 265,698 0.3
Telefonica del Peru S.A. - ADR{\/} ........................ PERU 12,200 249,338 0.3
TeleBermuda International Ltd.-/- {\/} (.) ................ BDA 33,200 249,000 0.3
Hellenic Telecommunication Organization S.A. (OTE) ........ GREC 111 2,850 --
------------
15,545,791
------------
Wireless Communications (18.5%)
Millicom International Cellular S.A.-/- {\/} .............. LUX 46,000 2,012,500 2.6
Nextel Communications, Inc. "A"-/- ........................ US 76,000 1,890,500 2.5
Orange PLC-/- ............................................. UK 116,200 1,232,042 1.6
Paging Network, Inc.-/- ................................... US 85,000 1,190,000 1.6
WinStar Communications, Inc.-/- ........................... US 25,000 1,073,438 1.4
Vodafone Group PLC ........................................ UK 80,900 1,027,291 1.4
Vimpel-Communications - ADR-/- {\/} ....................... RUS 22,000 984,500 1.3
Grupo Iusacell S.A. "L" - ADR-/- {\/} ..................... MEX 64,700 889,625 1.2
Bell Canada International, Inc.: .......................... CAN -- -- 1.1
Common-/- ............................................... -- 27,800 651,695 --
Common-/- {\/} .......................................... -- 5,400 126,225 --
Smartone Telecommunications ............................... HK 291,500 711,113 0.9
Western Wireless Corp. "A"-/- ............................. US 29,600 590,150 0.8
Clearnet Communications, Inc.: ............................ CAN -- -- 0.7
"A"-/- .................................................. -- 40,700 445,247 --
"A"-/- {\/} ............................................. -- 6,125 67,375 --
China Telecom (Hong Kong) Ltd. ............................ HK 170,000 295,127 0.4
Powertel, Inc.-/- ......................................... US 15,000 277,500 0.4
Champion Technology Holding Ltd. .......................... HK 7,173,856 245,379 0.3
Microcell Telecommunications, Inc. "B"-/- {\/} ............ CAN 24,000 216,000 0.3
------------
13,925,707
------------
Telecom Equipment (17.0%)
Nokia Oyj "A" - ADR{\/} ................................... FIN 45,000 3,265,311 4.3
ECI Telecommunications Ltd.{\/} ........................... ISRL 77,000 2,916,375 3.8
ANTEC Corp.-/- ............................................ US 50,000 1,159,375 1.5
Corning, Inc. ............................................. US 30,000 1,042,500 1.4
Tekelec-/- ................................................ US 22,900 1,024,775 1.3
</TABLE>
The accompanying notes are an integral part of the financial statements.
F23
<PAGE>
GT GLOBAL VARIABLE TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Telecom Equipment (Continued)
DSC Communications Corp.-/- ............................... US 32,000 $ 960,000 1.3
P-COM, Inc.-/- ............................................ US 80,000 732,500 1.0
Alcatel Alsthom Compagnie Generale d'Electricite .......... FR 3,390 690,315 0.9
Tellabs, Inc.-/- .......................................... US 9,000 644,625 0.8
Pairgain Technologies, Inc.-/- ............................ US 14,900 259,819 0.3
Mitec Telecom, Inc.-/- .................................... CAN 43,900 189,417 0.2
Performance Technologies, Inc.-/- ......................... US 15,000 168,750 0.2
------------
13,053,762
------------
Telephone - Regional/Local (10.4%)
GTE Corp. ................................................. US 30,000 1,668,750 2.2
SBC Communications ........................................ US 40,000 1,600,000 2.1
ICG Communications, Inc.-/- ............................... US 40,500 1,480,781 1.9
Intermedia Communications of Florida, Inc.-/- ............. US 33,500 1,404,906 1.8
Teleport Communications Group, Inc. "A"-/- ................ US 15,000 813,750 1.1
Bell Atlantic Corporation ................................. US 15,200 693,500 0.9
ING Barings Russian Regional Telecommunications Basket
Bridge Certificates-/-{=}{\/} ............................ RUS 66 336,320 0.4
------------
7,998,007
------------
Multi-Industry (6.0%)
Mannesmann AG ............................................. GER 38,500 3,960,598 5.2
Grupo Carso, S.A. de C.V. "A1" ............................ MEX 100,000 414,392 0.5
Hutchison Whampoa ......................................... HK 49,000 258,677 0.3
------------
4,633,667
------------
Telephone - Long Distance (4.7%)
Tel-Save Holdings, Inc.-/- ................................ US 85,000 1,253,750 1.6
MCI Communications Corp. .................................. US 15,000 871,875 1.1
Qwest Communications International, Inc.-/- ............... US 23,322 813,355 1.1
Rostelecom - ADR{\/} ...................................... RUS 50,000 668,750 0.9
------------
3,607,730
------------
Networking (4.2%)
Cisco Systems, Inc.-/- .................................... US 18,000 1,657,125 2.2
Ascend Communications, Inc.-/- ............................ US 30,000 1,486,875 2.0
------------
3,144,000
------------
Telecom Technology (3.9%)
Uniphase Corp.-/- ......................................... US 33,000 2,071,781 2.7
Orckit Communications Ltd.-/-{\/} ......................... ISRL 25,000 475,000 0.6
Esat Telecom Group PLC - ADR-/-{\/} ....................... IRE 11,300 429,400 0.6
------------
2,976,181
------------
Cable Television (3.3%)
Comcast UK Cable Partners Ltd. "A"{\/} .................... UK 85,000 1,333,438 1.8
Comcast Corp. "A" ......................................... US 22,000 893,063 1.2
</TABLE>
The accompanying notes are an integral part of the financial statements.
F24
<PAGE>
GT GLOBAL VARIABLE TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Cable Television (Continued)
United International Holdings, Inc. "A"-/- ................ US 12,000 $ 192,000 0.3
------------
2,418,501
------------
Consumer Services (2.1%)
Vivendi ................................................... FR 7,400 1,580,328 2.1
------------
Aerospace/Defense (1.7%)
Orbital Sciences Corp.-/- ................................. US 34,000 1,270,750 1.7
------------
Semiconductors (1.3%)
VLSI Technology, Inc.-/- .................................. US 40,000 671,250 0.9
DSP Communications, Inc.-/- ............................... US 23,400 321,750 0.4
------------
993,000
------------
Broadcasting & Publishing (0.9%)
Univision Communications, Inc.-/- ......................... US 18,000 670,500 0.9
------------
Telecom - Other (0.5%)
STET Hellas Telecommunications S.A. - ADR-/- {\/} ......... GREC 8,280 343,620 0.5
------------ -----
TOTAL EQUITY INVESTMENTS (cost $55,389,966) ................. 72,161,544 95.1
------------ -----
REPURCHASE AGREEMENT
Dated June 30, 1998, with State Street Bank & Trust Co.,
due July 1, 1998, for an effective yield of 5.70%,
collateralized by $2,450,000 U.S. Treasury Bills, 5.875%
due 1/31/99 (market value of collateral is $2,514,313,
including accrued interest). (cost $2,462,000) ........... 2,462,000 3.3
------------ -----
TOTAL INVESTMENTS (cost $57,851,966) * ..................... 74,623,544 98.4
Other Assets and Liabilities ................................ 1,241,032 1.6
------------ -----
NET ASSETS .................................................. $ 75,864,576 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
{\/} U.S. currency denominated.
(.) Restricted securities: At June 30, 1998 the Fund owned the
following restricted security constituting less than 0.4% of net
assets which may not be publicly sold without registration under
the Securities Act of 1933 (Note 1).
<TABLE>
<CAPTION>
VALUE
ACQUISITION ACQUISITION PER SHARE
DESCRIPTION DATE SHARES COST (NOTE 1)
- -------------------------------------------------------------------------------- ----------- ------ ----------- ---------
<S> <C> <C> <C> <C>
TeleBermuda International Ltd................................................... 10/4/96 33,200 $282,200 7.5
</TABLE>
{=} Issued by ING Barings, the value of which is linked to the
underlying value of a basket of shares issued by Russian regional
telephone companies.
* For Federal income tax purposes, cost is $57,851,966 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 21,544,421
Unrealized depreciation: (4,772,843)
-------------
Net unrealized appreciation: $ 16,771,578
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depositary Receipt
The accompanying notes are an integral part of the financial statements.
F25
<PAGE>
GT GLOBAL VARIABLE TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1998, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET
ASSETS {d}
---------------------
SHORT-TERM
&
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY OTHER TOTAL
- -------------------------------------- ------ ----- -----
<S> <C> <C> <C>
Bermuda (BDA/BEM) .................... 0.3 0.3
Brazil (BRZL/BRL) .................... 0.3 0.3
Canada (CAN/CAD) ..................... 2.9 2.9
Czech Republic (CZCH/CSK) ............ 3.0 3.0
Finland (FIN/FIM) .................... 5.1 5.1
France (FR/FRF) ...................... 3.0 3.0
Germany (GER/DEM) .................... 5.2 5.2
Greece (GREC/GRD) .................... 0.5 0.5
Hong Kong (HK/HKD) ................... 1.9 1.9
Hungary (HGRY/HUF) ................... 0.8 0.8
Ireland (IRE/IEP) .................... 0.6 0.6
Israel (ISRL/ILS) .................... 4.4 4.4
Italy (ITLY/ITL) ..................... 4.0 4.0
Luxembourg (LUX/LUF) ................. 2.6 2.6
Mexico (MEX/MXN) ..................... 2.5 2.5
New Zealand (NZ/NZD) ................. 0.4 0.4
Peru (PERU/PES) ...................... 0.3 0.3
Portgual (PORT/PTE) .................. 1.5 1.5
Russia (RUS/SUR) ..................... 2.6 2.6
Spain (SPN/ESP) ...................... 1.1 1.1
United Kingdom (UK/GBP) .............. 10.0 10.0
United States (US/USD) ............... 42.1 4.9 47.0
------ ----- -----
Total ............................... 95.1 4.9 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $75,864,576.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
JUNE 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
UNREALIZED
MARKET VALUE DELIVERY APPRECIATION
CONTRACTS TO SELL: (U.S. DOLLARS) CONTRACT PRICE DATE (DEPRECIATION)
- ---------------------------------------- ---------------- -------------- -------- ---------------
<S> <C> <C> <C> <C>
British Pounds.......................... 2,001,598 0.59400 7/20/98 $ 18,602
Deutsche Marks.......................... 751,305 1.74730 8/26/98 21,316
Deutsche Marks.......................... 333,913 1.74900 8/26/98 9,140
Deutsche Marks.......................... 445,345 1.77200 8/31/98 6,122
Finnish Markka.......................... 1,552,637 5.46000 7/21/98 4,139
Italian Lira............................ 1,492,156 1784.71000 7/21/98 (7,321)
Italian Lira............................ 309,693 1774.85001 7/21/98 193
---------------- ---------------
Total Contracts to Sell (Receivable
amount $6,938,838)................... 6,886,647 52,191
---------------- ---------------
THE VALUE OF CONTRACTS TO SELL AS
PERCENTAGE OF NET ASSETS IS 9.08%.
Total Open Forward Foreign Currency
Contracts............................ $ 52,191
---------------
---------------
</TABLE>
- ----------------
See Note 1 to the financial statements.
The accompanying notes are an integral part of the financial statements.
F26
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Services (20.3%)
Telecomunicacoes Brasileiras S.A. (Telebras): ............. BRZL -- -- 6.1
TELEPHONE NETWORKS
ADR{\/} ................................................. -- 3,999 $ 436,632 --
Common .................................................. -- 1,957,538 155,723 --
Telefonica del Peru S.A. - ADR{\/} ........................ PERU 7,780 159,004 1.6
TELEPHONE NETWORKS
Telefonos de Mexico, S.A. de C.V. "L" - ADR{\/} ........... MEX 3,218 154,665 1.6
TELEPHONE NETWORKS
Magyar Tavkozlesi Rt. - ADR{\/} ........................... HGRY 4,440 130,703 1.3
TELEPHONE NETWORKS
Cifra, S.A. de C.V. "V" ................................... MEX 66,795 100,449 1.0
RETAILERS-OTHER
Grupo Televisa, S.A. de C.V. - GDR-/- {\/} ................ MEX 2,300 86,538 0.9
BROADCASTING & PUBLISHING
Telefonica de Argentina S.A. - ADR{\/} .................... ARG 2,663 86,381 0.9
TELEPHONE NETWORKS
Pick'n Pay Stores Ltd. .................................... SAFR 64,431 78,362 0.8
RETAILERS-OTHER
Carso Global Telecom "A1" ................................. MEX 23,700 73,922 0.8
TELEPHONE NETWORKS
Cia de Telecomunicaciones de Chile S.A. - ADR{\/} ......... CHLE 3,064 62,238 0.6
TELEPHONE NETWORKS
Vimpel-Communications - ADR-/- {\/} ....................... RUS 1,100 49,225 0.5
WIRELESS COMMUNICATIONS
Nortel Inversora S.A. - ADR{\/} ........................... ARG 1,900 47,263 0.5
TELEPHONE NETWORKS
Hellenic Telecommunication Organization S.A. (OTE) ........ GREC 1,778 45,603 0.5
TELEPHONE NETWORKS
Telecomunicacoes de Sao Paulo S.A. (TELESP): .............. BRZL -- -- 0.4
TELEPHONE NETWORKS
Common-/- ............................................... -- 256,200 38,746 --
Preferred ............................................... -- 12,040 2,832 --
Mahanagar Telephone Nigam Ltd. ............................ IND 9,500 40,066 0.4
TELECOM - OTHER
Companhia de Saneamento Basico do Estado de Sao Paulo -
SABESP ................................................... BRZL 279,133 33,549 0.3
BUSINESS & PUBLIC SERVICES
Telecom Argentina S.A. - ADR{\/} .......................... ARG 1,100 32,794 0.3
TELEPHONE NETWORKS
Guangshen Railway Co., Ltd. ............................... HK 211,000 28,052 0.3
TRANSPORTATION - ROAD & RAIL
Rostelecom - ADR{\/} ...................................... RUS 1,700 22,738 0.2
TELEPHONE - LONG DISTANCE
Bezeq Israeli Telecommunication Corporation Ltd. .......... ISRL 6,800 21,762 0.2
TELEPHONE NETWORKS
Migros Turk T.A.S. ........................................ TRKY 17,500 17,102 0.2
RETAILERS-FOOD
Danubius Hotel and Spa Rt.-/- ............................. HGRY 767 15,446 0.2
LEISURE & TOURISM
Wooltru Ltd. "N" .......................................... SAFR 11,100 14,438 0.2
RETAILERS-OTHER
</TABLE>
The accompanying notes are an integral part of the financial statements.
F27
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Services (Continued)
Blue Square Chain Investments & Properties Ltd.-/- ........ ISRL 1,070 $ 13,195 0.1
RETAILERS-FOOD
Goody's S.A. .............................................. GREC 450 11,204 0.1
RESTAURANTS
Telesp Celular S.A.-/- .................................... BRZL 256,200 10,866 0.1
WIRELESS COMMUNICATIONS
Trade House GUM - ADR{\/} ................................. RUS 2,310 8,663 0.1
RETAILERS-OTHER
Santa Isabel S.A. - ADR{\/} ............................... CHLE 682 7,502 0.1
RETAILERS-FOOD
------------
1,985,663
------------
Finance (19.3%)
Turkiye Is Bankasi (Isbank): .............................. TRKY -- -- 1.9
BANKS-MONEY CENTER
"C" Bonus Shares ........................................ -- 2,563,875 103,596 --
"C" Common .............................................. -- 1,881,225 76,013 --
Bank Hapoalim Ltd.-/- ..................................... ISRL 43,124 130,597 1.3
BANKS-REGIONAL
Uniao de Bancos Brasileiros S.A. (Unibanco): .............. BRZL -- -- 1.0
BANKS-MONEY CENTER
Units{=} ................................................ -- 1,015,264 60,047 --
GDR-/- {\/} ............................................. -- 1,410 41,595 --
Bank Leumi Le - Israel .................................... ISRL 50,626 101,106 1.0
BANKS-REGIONAL
Turkiye Garanti Bankasi AS-/- ............................. TRKY 1,891,800 87,106 0.9
BANKS-REGIONAL
Yapi ve Kredi Bankasi AS .................................. TRKY 3,317,666 84,797 0.9
BANKS-REGIONAL
Credicorp Ltd. - ADR{\/} .................................. PERU 5,280 77,550 0.8
BANKS-MONEY CENTER
Alpha Credit Bank ......................................... GREC 900 73,012 0.7
BANKS-REGIONAL
Misr International Bank - Reg S GDR{c} {\/} ............... EGPT 6,200 72,385 0.7
BANKS-MONEY CENTER
Commercial International Bank ............................. EGPT 6,500 71,830 0.7
BANKS-MONEY CENTER
ABSA Group Ltd. ........................................... SAFR 11,325 70,781 0.7
BANKS-REGIONAL
Akbank T.A.S. ............................................. TRKY 1,934,500 62,532 0.6
BANKS-REGIONAL
National Bank of Greece S.A. .............................. GREC 480 61,555 0.6
BANKS-MONEY CENTER
LibLife Strategic Investments Ltd. ........................ SAFR 17,500 51,584 0.5
INVESTMENT MANAGEMENT
Grupo Financiero Banamex Accival, S.A. de C.V. "B"-/- ..... MEX 23,500 45,812 0.5
BANKS-MONEY CENTER
National Societe Generale Bank ............................ EGPT 2,375 43,975 0.5
BANKS-MONEY CENTER
State Bank of India Ltd. - Reg S GDR-/- {c} {\/} .......... IND 3,690 43,542 0.4
BANKS-REGIONAL
</TABLE>
The accompanying notes are an integral part of the financial statements.
F28
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Finance (Continued)
Aksigorta AS .............................................. TRKY 627,700 $ 40,698 0.4
INSURANCE - MULTI-LINE
Ergo Bank S.A. ............................................ GREC 470 40,200 0.4
BANKS-REGIONAL
Banco de Galicia y Buenos Aires, S.A. de C.V. - ADR{\/} ... ARG 1,962 35,807 0.4
BANKS-MONEY CENTER
Commercial Bank of Greece S.A. ............................ GREC 480 35,632 0.4
BANKS-MONEY CENTER
Banco de A. Edwards - ADR{\/} ............................. CHLE 2,483 35,228 0.4
BANKS-MONEY CENTER
Banco do Estado de Sao Paulo S.A. - Banespa ............... BRZL 750,000 34,702 0.4
BANKS-REGIONAL
C.G. Smith Ltd. ........................................... SAFR 12,300 33,867 0.3
INVESTMENT MANAGEMENT
Administradora de Fondos de Pensiones Provida S.A. -
ADR{\/} .................................................. CHLE 2,002 33,408 0.3
INVESTMENT MANAGEMENT
Nedcor Ltd. ............................................... SAFR 1,400 30,270 0.3
BANKS-REGIONAL
OTP Bank Rt. .............................................. HGRY 600 29,521 0.3
BANKS-MONEY CENTER
Liberty Life Association of Africa Ltd. ................... SAFR 1,300 25,385 0.3
INSURANCE-LIFE
Wafabank .................................................. MOR 200 24,062 0.2
OTHER FINANCIAL
Liberty Investors Ltd. .................................... SAFR 6,600 23,412 0.2
INVESTMENT MANAGEMENT
Banco Rio de La Plata S.A. - ADR{\/} ...................... ARG 2,200 23,238 0.2
BANKS-MONEY CENTER
Inversiones y Representaciones S.A. (IRSA) - GDR{\/} ...... ARG 750 21,844 0.2
REAL ESTATE
Kazkommertsbank Co. - GDR-/- {\/} ......................... KAZ 1,070 21,400 0.2
BANKS-REGIONAL
Bank Slaski S.A. .......................................... POL 293 19,676 0.2
BANKS-MONEY CENTER
National Mortgage Bank of Greece .......................... GREC 250 15,746 0.2
BANKS-REGIONAL
Global Menkul Degerler AS ................................. TRKY 771,026 14,200 0.1
SECURITIES BROKER
Standard Bank Investment Corporation Ltd. ................. SAFR 1,900 8,120 0.1
BANKS-MONEY CENTER
Malayan Banking Bhd. ...................................... MAL 6,000 6,050 0.1
BANKS-MONEY CENTER
Ayala Land, Inc. .......................................... PHIL 8,600 2,487 --
REAL ESTATE
------------
1,914,368
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F29
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Energy (14.0%)
Petroleo Brasileiro S.A. (Petrobras) Preferred ............ BRZL 841,780 $ 156,492 1.6
OIL
LUKoil Holding - ADR{\/} .................................. RUS 4,340 145,390 1.5
OIL
Companhia Energetica de Minas Gerais (CEMIG) - ADR{\/} .... BRZL 3,561 109,946 1.1
ELECTRICAL & GAS UTILITIES
Centrais Eletricas Brasileiras S.A. (Eletrobras): ......... BRZL -- -- 1.1
ELECTRICAL & GAS UTILITIES
"B" - ADR{\/} ........................................... -- 4,603 69,045 --
"B" Preferred ........................................... -- 1,198,000 36,049 --
YPF S.A. - ADR{\/} ........................................ ARG 3,378 101,551 1.0
ENERGY SOURCES
Sasol Ltd. ................................................ SAFR 15,146 87,883 0.9
ENERGY SOURCES
Empresa Nacional de Electricidad S.A. - ADR{\/} ........... CHLE 5,387 76,765 0.8
ELECTRICAL & GAS UTILITIES
Enersis S.A. - ADR{\/} .................................... CHLE 2,963 72,408 0.7
ELECTRICAL & GAS UTILITIES
Unified Energy Systems - Reg S GDR-/- {c} {\/} ............ RUS 5,000 71,250 0.7
ELECTRICAL & GAS UTILITIES
Eletropaulo Metropolitana Preferred-/- .................... BRZL 608,102 45,746 0.5
ELECTRICAL & GAS UTILITIES
MOL Magyar Olaj-es Gazipari RT - Reg S GDR{c} {\/} ........ HGRY 1,690 45,546 0.5
ENERGY SOURCES
Light - Servicos de Electricidade S.A. .................... BRZL 144,328 44,303 0.5
ELECTRICAL & GAS UTILITIES
Gener S.A. - ADR{\/} ...................................... CHLE 2,386 43,545 0.4
ELECTRICAL & GAS UTILITIES
Companhia de Eletricidade do Estado da Bahia -
COELBA-/- ................................................ BRZL 1,000,000 37,164 0.4
ELECTRICAL & GAS UTILITIES
Cukurova Elektrik AS ...................................... TRKY 13,000 37,136 0.4
ELECTRICAL & GAS UTILITIES
Bombay Suburban Electric Supply (BSES) Ltd. ............... IND 8,850 32,638 0.3
ELECTRICAL & GAS UTILITIES
Ingwe Coal Corp. .......................................... SAFR 10,800 31,014 0.3
COAL
Perez Companc S.A. "B" .................................... ARG 5,326 26,739 0.3
OIL
Chilectra S.A. - ADR{\/} .................................. CHLE 840 17,640 0.2
ELECTRICAL & GAS UTILITIES
Surgutneftegaz - ADR{\/} .................................. RUS 4,410 17,640 0.2
OIL
Irkutskenergo - ADR{\/} ................................... RUS 3,500 17,063 0.2
ELECTRICAL & GAS UTILITIES
Companhia Brasileira de Petroleo Ipiranga S.A.
Preferred ................................................ BRZL 1,616,000 14,756 0.2
OIL
The Hub Power Co., Ltd. - GDR{\/} ......................... PAK 2,000 13,000 0.1
ENERGY SOURCES
Empresa Bandeirante de Energia S.A.-/- .................... BRZL 608,102 9,622 0.1
ELECTRICAL & GAS UTILITIES
</TABLE>
The accompanying notes are an integral part of the financial statements.
F30
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Energy (Continued)
Centrais Geradoras do Sul do Brasil S.A. (Gerasul): ....... BRZL -- -- --
ELECTRICAL & GAS UTILITIES
ADR{\/} ................................................. -- 460 $ 3,222 --
Preferred-/- ............................................ -- 1,198,000 1,730 --
Companhia Paranaense de Energia - Copel ................... BRZL 504,000 3,966 --
ELECTRICAL & GAS UTILITIES
Empresa Paulista de Transmissao de Energia Eletrica-/- .... BRZL 608,102 2,151 --
ELECTRICAL & GAS UTILITIES
Pakistan State Oil Co., Ltd. .............................. PAK 880 1,412 --
OIL
Empresa Metropolitana de Aguas e Energia S.A.-/- .......... BRZL 608,102 473 --
ELECTRICAL & GAS UTILITIES
------------
1,373,285
------------
Multi-Industry/Miscellaneous (13.6%)
GT Taiwan Fund-/- +X+ {\/} ................................ TWN 40,391 465,569 4.8
COUNTRY FUNDS
The Saudi Arabian Investment Fund Ltd.-/- {\/} ............ UK 18,100 142,628 1.5
COUNTRY FUNDS
Haci Omer Sabanci Holding AS .............................. TRKY 1,535,599 95,235 1.0
CONGLOMERATE
NASR (El) City Company For Housing & Construction ......... EGPT 1,950 93,560 1.0
MISCELLANEOUS
Koc Holding AS ............................................ TRKY 448,300 87,621 0.9
CONGLOMERATE
Barlow Ltd. ............................................... SAFR 14,957 78,954 0.8
CONGLOMERATE
Rembrandt Group Ltd. ...................................... SAFR 12,517 78,231 0.8
CONGLOMERATE
Grupo Carso, S.A. de C.V. "A1" ............................ MEX 17,900 74,176 0.8
MULTI-INDUSTRY
Koor Industries Ltd. - ADR{\/} ............................ ISRL 2,145 50,139 0.5
CONGLOMERATE
Sanluis Corporacion, S.A. de C.V. ......................... MEX 10,637 41,472 0.4
CONGLOMERATE
Anglo American Corporation of South Africa Ltd. ........... SAFR 1,003 33,885 0.3
CONGLOMERATE
ONA (Omnium Nord Africain) S.A. "A" ....................... MOR 190 23,035 0.2
CONGLOMERATE
Alfa, S.A. de C.V. "A" .................................... MEX 4,000 16,353 0.2
CONGLOMERATE
Quinenco S.A. - ADR-/- {\/} ............................... CHLE 1,700 15,300 0.2
CONGLOMERATE
Antofagasta Holdings PLC .................................. UK 3,600 15,178 0.2
CONGLOMERATE
Ayala Corp. ............................................... PHIL 10,580 2,741 --
CONGLOMERATE
------------
1,314,077
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F31
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Materials/Basic Industry (11.2%)
Suez Cement Co. - Reg S GDR{c} {\/} ....................... EGPT 7,263 $ 131,642 1.3
CEMENT
Helioplis Housing ......................................... EGPT 1,271 127,380 1.3
BUILDING MATERIALS & COMPONENTS
Kimberly-Clark de Mexico, S.A. de C.V. "A" ................ MEX 32,709 115,686 1.2
PAPER/PACKAGING
Companhia Vale do Rio Doce Preferred ...................... BRZL 4,700 93,472 1.0
METALS - STEEL
Anglo American Platinum Corporation Ltd. .................. SAFR 5,000 54,476 0.6
METALS - NON-FERROUS
Industrias Penoles S.A. (CP) .............................. MEX 16,540 52,511 0.5
METALS - NON-FERROUS
Apasco, S.A. de C.V. ...................................... MEX 9,831 51,964 0.5
CEMENT
Compania de Minas Buenaventura S.A. - ADR{\/} ............. PERU 3,900 51,188 0.5
METALS - NON-FERROUS
De Beers Centenary AG - Linked Unit{.:} ................... SAFR 2,900 51,044 0.5
MISC. MATERIALS & COMMODITIES
Cemex, S.A. de C.V.: ...................................... MEX -- -- 0.5
CEMENT
"CPO" ................................................... -- 10,147 38,149 --
"A" ..................................................... -- 3,200 12,031 --
Ameriyah Cement Co. ....................................... EGPT 2,800 48,553 0.5
CEMENT
SA Iron & Steel Industrial Corporation Ltd. (ISCOR) ....... SAFR 228,147 43,163 0.4
METALS - STEEL
Hindalco Industries Ltd.: ................................. IND -- -- 0.4
METALS - NON-FERROUS
GDR{\/} ................................................. -- 2,400 33,480 --
Common .................................................. -- 400 6,312 --
Sociedad Quimica y Minera de Chile S.A. - ADR{\/} ......... CHLE 960 32,160 0.3
CHEMICALS
Makhteshim-Agan Industries Ltd. ........................... ISRL 9,327 29,723 0.3
CHEMICALS
Grupo Cementos de Chihuahua, S.A. de C.V. "B" ............. MEX 29,100 24,766 0.3
CEMENT
Siderca S.A. "A" .......................................... ARG 12,400 21,082 0.2
METALS - STEEL
Titan Cement Co., S.A. .................................... GREC 300 19,641 0.2
BUILDING MATERIALS & COMPONENTS
Torah Portland Cement Co. ................................. EGPT 900 15,540 0.2
CEMENT
AECI Ltd. ................................................. SAFR 3,800 15,277 0.2
CHEMICALS
Reliance Industries Ltd. - GDR-/- {\/} .................... IND 1,690 11,154 0.1
CHEMICALS
Pannonplast Rt. ........................................... HGRY 291 10,788 0.1
MISC. MATERIALS & COMMODITIES
Agros Holding S.A. "C"-/- ................................. POL 596 8,723 0.1
MISC. MATERIALS & COMMODITIES
</TABLE>
The accompanying notes are an integral part of the financial statements.
F32
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Materials/Basic Industry (Continued)
Engro Chemicals Pakistan Ltd. ............................. PAK 1,470 $ 1,579 --
CHEMICALS
------------
1,101,484
------------
Consumer Non-Durables (7.9%)
Hindustan Lever Ltd. ...................................... IND 3,800 135,605 1.4
PERSONAL CARE/COSMETICS
Fomento Economico Mexicano, S.A. de C.V. - ADR{\/} ........ MEX 3,867 121,811 1.2
BEVERAGES - NON-ALCOHOLIC
ITC Ltd. .................................................. IND 6,500 100,189 1.0
TOBACCO
South African Breweries Ltd. .............................. SAFR 3,223 66,420 0.7
BEVERAGES - ALCOHOLIC
Gruma S.A. "B"-/- ......................................... MEX 23,420 51,082 0.5
FOOD
Compania Cervecerias Unidas S.A. - ADR{\/} ................ CHLE 2,400 50,700 0.5
BEVERAGES - ALCOHOLIC
Embotelladora Andina S.A. "B" - ADR{\/} ................... CHLE 2,907 45,422 0.5
BEVERAGES - NON-ALCOHOLIC
A-Ahram Beverages Co. S.A.E. - 144A GDR{.} {\/} ........... EGPT 1,400 44,450 0.5
BEVERAGES - ALCOHOLIC
Hellenic Bottling Co. S.A. ................................ GREC 970 29,989 0.3
BEVERAGES - NON-ALCOHOLIC
Eastern Tobacco Co. ....................................... EGPT 1,600 28,769 0.3
TOBACCO
SUN Brewing Ltd. - GDR-/- {\/} ............................ RUS 2,400 27,950 0.3
BEVERAGES - ALCOHOLIC
Oriental Weavers "C"-/- ................................... EGPT 1,350 27,595 0.3
TEXTILES & APPAREL
Companhia Cervejaria Brahma Preferred ..................... BRZL 42,241 26,298 0.3
BEVERAGES - ALCOHOLIC
Zaklady Piwowarskie w Zywcu S.A. (Zywiec) ................. POL 103 12,415 0.1
BEVERAGES - ALCOHOLIC
Truworths International Ltd. .............................. SAFR 3,872 2,616 --
TEXTILES & APPAREL
Erciyas Biracilik ve Malt Sanayii AS ...................... TRKY 9,000 1,370 --
BEVERAGES - ALCOHOLIC
------------
772,681
------------
Health Care (2.1%)
Teva Pharmaceutical Industries Ltd. ....................... ISRL 1,900 68,322 0.7
PHARMACEUTICALS
Ranbaxy Laboratories Ltd. ................................. IND 3,000 38,830 0.4
MEDICAL TECHNOLOGY & SUPPLIES
Egypt International Pharmaceutical Industries Co.
(EIPICO) ................................................. EGPT 600 38,442 0.4
PHARMACEUTICALS
Richter Gedeon Rt. - Reg S GDR-/- {c} {\/} ................ HGRY 425 33,894 0.4
PHARMACEUTICALS
</TABLE>
The accompanying notes are an integral part of the financial statements.
F33
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Health Care (Continued)
EGIS Rt. .................................................. HGRY 440 $ 15,506 0.2
PHARMACEUTICALS
------------
194,994
------------
Consumer Durables (1.3%)
Bajaj Auto Ltd. ........................................... IND 2,550 34,482 0.4
AUTOMOBILES
Imperial Holdings Ltd. .................................... SAFR 3,157 30,930 0.3
AUTOMOBILES
Qingling Motors Co., Ltd.{*} .............................. CHNA 110,000 30,526 0.3
AUTOMOBILES
Mahindra & Mahindra Ltd. .................................. IND 3,800 19,332 0.2
AUTOMOBILES
Tata Engineering and Locomotive Co., Ltd. - GDR{\/} ....... IND 2,320 7,424 0.1
AUTOMOBILES
------------
122,694
------------
Capital Goods (1.1%)
NICE-Systems Ltd.-/- ...................................... ISRL 1,100 40,965 0.4
TELECOM EQUIPMENT
Corporacion GEO, S.A. de C.V. "B"-/- ...................... MEX 5,700 31,875 0.3
CONSTRUCTION
Arabian International Construction-/- ..................... EGPT 435 18,410 0.2
CONSTRUCTION
Netas Telekomunik-/- ...................................... TRKY 50,600 13,503 0.1
TELECOM EQUIPMENT
Elektrim Spolka Akcyjna S.A. .............................. POL 1,082 13,197 0.1
ELECTRICAL PLANT/EQUIPMENT
Samsung Electro-Mechanics Co. ............................. KOR 131 1,673 --
ELECTRICAL PLANT/EQUIPMENT
------------
119,623
------------
Technology (0.8%)
Formula Systems Ltd.-/- ................................... ISRL 1,402 49,114 0.5
SOFTWARE
Alcatel Teletas Telekomunikasyon Endustri ve Ticaret AS ... TRKY 223,500 29,402 0.3
TELECOM TECHNOLOGY
Samsung Electronics (1/2 of Common Share) - GDR{\/} ....... KOR 66 1,055 --
SEMICONDUCTORS
------------
79,571
------------ -----
TOTAL EQUITY INVESTMENTS (cost $11,117,975) ................. 8,978,440 91.6
------------ -----
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Government & Government Agency Obligations (1.4%)
Russia (1.4%)
Bank for Foreign Economic Affairs (Venesheconombank)
Interest Notes, 6.63% due 12/15/15 (cost $170,094)+ .... USD 249,698 138,895 1.4
------------ -----
</TABLE>
The accompanying notes are an integral part of the financial statements.
F34
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NO. OF VALUE % OF NET
RIGHTS COUNTRY RIGHTS (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Alpha Credit Bank Rights, expire July 31, 1998 ............ GREC 900 1,602 --
BANKS-REGIONAL
------------ -----
TOTAL RIGHTS (cost $0) ...................................... 1,602 --
------------ -----
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated June 30, 1998, with State Street Bank & Trust Co.,
due July 1, 1998, for an effective yield of 5.70%,
collateralized by $50,000 U.S. Treasury Bills, 5.875% due
1/31/99 (market value of collateral is $51,313, including
accrued interest). (cost $49,000) ....................... 49,000 0.5
------------ -----
TOTAL INVESTMENTS (cost $11,337,069) * ..................... 9,167,937 93.5
Other Assets and Liabilities ................................ 634,284 6.5
------------ -----
NET ASSETS .................................................. $ 9,802,221 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
{*} Security denominated in Hong Kong Dollars.
{\/} U.S. currency denominated.
{.} Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
{c} Security issued under Regulation S. Rule 144A and additional
restrictions may apply in the resale of such securities.
{=} Each unit represents one preferred share of Unibanco and one
preferred "B" share of Unibanco Holdings.
{.:} Each Centenary Linked Unit consists of 1 registered deferred share
of De Beers Consolidated Mine + 1 Centenary Depositary Receipt.
+X+ The GT Global Variable Emerging Markets Fund (the "Fund") has
invested in the GT Global Taiwan Fund, a fund managed by INVESCO
(NY), Inc. which is an affiliate of the Fund's manager, A I M
Advisors, Inc.
+ The coupon rate shown on floating rate note represents the rate at
period end.
* For Federal income tax purposes, cost is $11,476,996 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 375,447
Unrealized depreciation: (2,684,506)
-------------
Net unrealized depreciation: $ (2,309,059)
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depositary Receipt
GDR--Global Depositary Receipt
The accompanying notes are an integral part of the financial statements.
F35
<PAGE>
GT GLOBAL VARIABLE EMERGING MARKETS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1998, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS {D}
-------------------------------------------
FIXED INCOME SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY & RIGHTS & OTHER TOTAL
- -------------------------------------- ------ ------------- ---------- -----
<S> <C> <C> <C> <C>
Argentina (ARG/ARS) .................. 4.0 4.0
Brazil (BRZL/BRL) .................... 15.1 15.1
Chile (CHLE/CLP) ..................... 5.0 5.0
China (CHNA/RMB) ..................... 0.3 0.3
Egypt (EGPT/EGP) ..................... 7.9 7.9
Greece (GREC/GRD) .................... 3.4 3.4
Hong Kong (HK/HKD) ................... 0.3 0.3
Hungary (HGRY/HUF) ................... 3.0 3.0
India (IND/INR) ...................... 5.1 5.1
Israel (ISRL/ILS) .................... 5.0 5.0
Kazakhstan (KAZ/KTS) ................. 0.2 0.2
Malaysia (MAL/MYR) ................... 0.1 0.1
Mexico (MEX/MXN) ..................... 11.2 11.2
Morocco (MOR/MAD) .................... 0.4 0.4
Pakistan (PAK/PKR) ................... 0.1 0.1
Peru (PERU/PES) ...................... 2.9 2.9
Poland (POL/PLZ) ..................... 0.5 0.5
Russia (RUS/SUR) ..................... 3.7 1.4 5.1
South Africa (SAFR/ZAR) .............. 9.2 9.2
Taiwan (TWN/TWD) ..................... 4.8 4.8
Turkey (TRKY/TRL) .................... 7.7 7.7
United Kingdom (UK/GBP) .............. 1.7 1.7
United States (US/USD) ............... 7.0 7.0
------ ----- ----- -----
Total ............................... 91.6 1.4 7.0 100.0
------ ----- ----- -----
------ ----- ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $9,802,221.
The accompanying notes are an integral part of the financial statements.
F36
<PAGE>
GT GLOBAL VARIABLE INFRASTRUCTURE FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Electrical & Gas Utilities (29.4%)
AES Corp.-/- .............................................. US 4,900 $ 257,651 3.1
Viag AG ................................................... GER 350 241,071 2.9
Houston Industries, Inc. .................................. US 6,000 185,250 2.3
Endesa S.A. - ADR{\/} ..................................... SPN 8,000 173,000 2.1
Dominion Resources, Inc. .................................. US 4,000 163,000 2.0
RWE AG .................................................... GER 2,500 148,070 1.8
Interstate Energy Corp. ................................... US 4,446 144,495 1.8
Companhia Energetica de Minas Gerais (CEMIG) - ADR{\/} .... BRZL 4,406 136,025 1.7
Light - Servicos de Electricidade S.A. .................... BRZL 440,000 135,063 1.7
Pinnacle West Capital Corp. ............................... US 3,000 135,000 1.6
National Grid Group PLC ................................... UK 20,000 134,914 1.6
Edison S.p.A. ............................................. ITLY 16,200 130,525 1.6
BG PLC .................................................... UK 20,000 115,712 1.4
MCN Energy Group, Inc. .................................... US 3,500 87,063 1.1
MetroGas S.A. - ADR{\/} ................................... ARG 7,662 67,521 0.8
EVN Energie-Versorgung Niederoesterreich AG ............... ASTRI 400 59,929 0.7
Eletropaulo Metropolitana Preferred-/- .................... BRZL 680,000 51,154 0.6
Hub Power Co. ............................................. PAK 75,400 21,026 0.3
Gener S.A. - ADR{\/} ...................................... CHLE 930 16,973 0.2
Empresa Bandeirante de Energia S.A.-/- .................... BRZL 680,000 10,760 0.1
Empresa Paulista de Transmissao de Energia Eletrica-/- .... BRZL 680,000 2,405 --
Empresa Metropolitana de Aguas e Energia S.A.-/- .......... BRZL 680,000 529 --
------------
2,417,136
------------
Transportation - Airlines (8.3%)
Comair Holdings, Inc. ..................................... US 5,000 154,375 1.9
Alaska Air Group, Inc.-/- ................................. US 2,300 125,494 1.5
America West Holdings Corp. "B"-/- ........................ US 4,000 114,250 1.4
Atlantic Coast Airlines Holdings-/- ....................... US 3,700 111,000 1.4
Airborne Freight Corp. .................................... US 3,000 104,813 1.3
Aeroporti di Roma SpA ..................................... ITLY 10,000 62,943 0.8
------------
672,875
------------
Aerospace/Defense (7.6%)
Gulfstream Aerospace Corp.-/- ............................. US 4,000 186,000 2.3
United Technologies Corp. ................................. US 1,500 138,750 1.7
General Electric Co. PLC .................................. UK 13,000 112,114 1.4
British Aerospace PLC ..................................... UK 12,500 95,801 1.2
Doncasters PLC - ADR-/- {\/} .............................. UK 2,800 77,875 1.0
------------
610,540
------------
Cement (5.8%)
Lafarge S.A. .............................................. FR 2,000 206,776 2.5
Suez Cement Co. - Reg S GDR{c} {\/} ....................... EGPT 5,100 92,438 1.1
La Cementos Nacional, C.A. - 144A GDR{.} {\/} ............. ECDR 543 80,364 1.0
Cimpor-Cimentos de Portugal, SGPS S.A. .................... PORT 1,800 63,296 0.8
</TABLE>
The accompanying notes are an integral part of the financial statements.
F37
<PAGE>
GT GLOBAL VARIABLE INFRASTRUCTURE FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Cement (Continued)
Apasco, S.A. de C.V. ...................................... MEX 5,400 $ 28,543 0.4
------------
471,417
------------
Telephone Networks (5.5%)
Telecom Italia SpA - Di Risp .............................. ITLY 35,900 174,811 2.2
Portugal Telecom S.A. - ADR{\/} ........................... PORT 2,200 116,463 1.4
Magyar Tavkozlesi Rt. - ADR{\/} ........................... HGRY 3,400 100,088 1.2
Telecom Corporation of New Zealand Ltd. - Installment
Receipts ................................................. NZ 25,900 55,353 0.7
Hellenic Telecommunication Organization S.A. (OTE) ........ GREC 111 2,848 --
------------
449,563
------------
Transportation - Road & Rail (5.4%)
Canadian National Railway Co. ............................. CAN 2,600 138,153 1.7
Swift Transportation Co., Inc.-/- ......................... US 5,000 99,063 1.2
Navistar International Corp.-/- ........................... US 3,000 86,625 1.0
Brisa-Auto Estradas de Portugal S.A. ...................... PORT 1,600 66,068 0.8
Tranz Rail Holdings Ltd. - ADR{\/} ........................ NZ 9,000 59,625 0.7
------------
449,534
------------
Building Materials & Components (4.6%)
Masco Corp. ............................................... US 4,000 242,000 3.0
Martin Marietta Materials, Inc. ........................... US 3,000 135,000 1.6
------------
377,000
------------
Wireless Communications (4.5%)
Mannesmann AG ............................................. GER 2,500 257,182 3.1
Paging Network, Inc.-/- ................................... US 7,000 98,000 1.2
China Telecom (Hong Kong) Ltd. ............................ HK 8,000 13,888 0.2
------------
369,070
------------
Housing (3.6%)
Kaufman and Broad Home Corp. .............................. US 5,500 174,625 2.1
D.R. Horton, Inc. ......................................... US 6,000 125,250 1.5
------------
299,875
------------
Machinery & Engineering (3.3%)
Ingersoll-Rand Co. ........................................ US 2,500 110,156 1.3
Sauer, Inc. ............................................... US 7,000 98,438 1.2
Alstom .................................................... FR 2,090 68,800 0.8
------------
277,394
------------
Networking (3.3%)
Ascend Communications, Inc.-/- ............................ US 3,000 148,688 1.8
Cisco Systems, Inc.-/- .................................... US 1,300 119,681 1.5
------------
268,369
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F38
<PAGE>
GT GLOBAL VARIABLE INFRASTRUCTURE FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Consumer Services (3.0%)
Vivendi ................................................... FR 1,140 $ 243,456 3.0
------------
Gas Production & Distribution (2.9%)
Enron Corp. ............................................... US 4,397 237,713 2.9
------------
Telecom Technology (2.1%)
Ciena Corp.-/- ............................................ US 2,500 174,063 2.1
L-3 Communications Holdings, Inc.-/- ...................... US 100 3,269 --
------------
177,332
------------
Industrial Components (1.5%)
Illinois Tool Works, Inc. ................................. US 1,800 120,038 1.5
------------
Metals - Steel (1.0%)
IPSCO, Inc. ............................................... CAN 2,914 79,201 1.0
------------
Semiconductors (0.4%)
EMCORE Corp.-/- ........................................... US 3,000 30,000 0.4
------------ -----
TOTAL EQUITY INVESTMENTS (cost $6,752,971) .................. 7,550,513 92.2
------------ -----
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated June 30, 1998, with State Street Bank & Trust Co.,
due July 1, 1998, for an effective yield of 5.70%,
collateralized by $355,000 U.S. Treasury Bills, 5.875% due
1/31/99 (market value of collateral is $364,319, including
accrued interest). (cost $354,000) ....................... 354,000 4.3
------------ -----
TOTAL INVESTMENTS (cost $7,106,971) * ...................... 7,904,513 96.5
Other Assets and Liabilities ................................ 286,387 3.5
------------ -----
NET ASSETS .................................................. $ 8,190,900 100.0
------------ -----
------------ -----
</TABLE>
- --------------
{\/} U.S. currency denominated.
-/- Non-income producing security.
{c} Security issued under Regulation S. Rule 144A and additional
restrictions may apply in the resale of such securities.
{.} Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
* For Federal income tax purposes, cost is $7,106,971 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 1,205,663
Unrealized depreciation: (408,121)
-------------
Net unrealized appreciation: $ 797,542
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depositary Receipt
GDR--Global Depositary Receipt
The accompanying notes are an integral part of the financial statements.
F39
<PAGE>
GT GLOBAL VARIABLE INFRASTRUCTURE FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1998, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS
{D}
---------------------------
SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY & OTHER TOTAL
- -------------------------------------- ------ ---------- -----
<S> <C> <C> <C>
Argentina (ARG/ARS) .................. 0.8 0.8
Austria (ASTRI/ATS) .................. 0.7 0.7
Brazil (BRZL/BRL) .................... 4.1 4.1
Canada (CAN/CAD) ..................... 2.7 2.7
Chile (CHLE/CLP) ..................... 0.2 0.2
Ecuador (ECDR/ECS) ................... 1.0 1.0
Egypt (EGPT/EGP) ..................... 1.1 1.1
France (FR/FRF) ...................... 6.3 6.3
Germany (GER/DEM) .................... 7.8 7.8
Hong Kong (HK/HKD) ................... 0.2 0.2
Hungary (HGRY/HUF) ................... 1.2 1.2
Italy (ITLY/ITL) ..................... 4.5 4.5
Mexico (MEX/MXN) ..................... 0.4 0.4
New Zealand (NZ/NZD) ................. 1.4 1.4
Pakistan (PAK/PKR) ................... 0.3 0.3
Portgual (PORT/PTE) .................. 3.0 3.0
Spain (SPN/ESP) ...................... 2.1 2.1
United Kingdom (UK/GBP) .............. 6.6 6.6
United States (US/USD) ............... 47.8 7.8 55.6
------ ----- -----
Total ............................... 92.2 7.8 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $8,190,900.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
JUNE 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE CONTRACT DELIVERY UNREALIZED
CONTRACTS TO SELL: (U.S. DOLLARS) PRICE DATE APPRECIATION
- ---------------------------------------- -------------- ----------- -------- --------------
<S> <C> <C> <C> <C>
Deutsche Marks.......................... 389,566 1.74730 8/26/98 11,052
French Francs........................... 232,129 5.94360 8/6/98 3,418
Italian Lira............................ 253,385 1768.80000 7/21/98 1,025
-------------- --------------
Total Contracts to Sell (Receivable
amount $890,575)..................... 875,080 15,495
-------------- --------------
THE VALUE OF CONTRACTS TO SELL AS
PERCENTAGE OF NET ASSETS IS 10.68%.
Total Open Forward Foreign Currency
Contracts............................ $ 15,495
--------------
--------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F40
<PAGE>
GT GLOBAL VARIABLE NATURAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Chemicals (23.3%)
NOVA Corp. ................................................ CAN 28,600 $ 327,450 3.2
Henkel KGaA Non-voting Preferred .......................... GER 3,210 317,760 3.1
Valero Energy Corp. ....................................... US 8,500 282,625 2.7
Cabot Corp. ............................................... US 6,900 222,956 2.2
Ultramar Diamond Shamrock Corp. ........................... US 7,000 220,938 2.1
ERG SpA ................................................... ITLY 49,000 195,205 1.9
E.I. du Pont de Nemours & Company ......................... US 2,400 179,100 1.7
Solutia, Inc. ............................................. US 6,100 174,994 1.7
Monsanto Co. .............................................. US 3,000 167,625 1.6
Akzo Nobel N.V. ........................................... NETH 750 166,839 1.6
Crompton & Knowles Corp. .................................. US 6,200 156,163 1.5
------------
2,411,655
------------
Oil (19.5%)
Total Compagnie Francaise des Petroles S.A. - ADR{\/} ..... FR 5,050 330,144 3.2
Suncor Energy, Inc. ....................................... CAN 8,100 275,192 2.7
Petro-Canada .............................................. CAN 15,100 242,142 2.4
Triton Energy Ltd.-/- ..................................... US 5,700 203,419 2.0
British Petroleum Co., PLC - ADR{\/} ...................... UK 2,100 185,325 1.8
Ente Nazionale Idrocarburi (ENI) S.p.A. - ADR{\/} ......... ITLY 2,700 175,500 1.7
Elf Aquitaine ADR{\/} ..................................... FR 2,200 156,200 1.5
Texaco, Inc. .............................................. US 2,200 131,313 1.3
Orogen Minerals Ltd. - 144A ADR{.} {\/} ................... AUSL 9,000 120,142 1.2
Crestar Energy, Inc.-/- ................................... CAN 9,200 111,585 1.1
Anderson Exploration Ltd.-/- .............................. CAN 5,500 63,532 0.6
------------
1,994,494
------------
Forest Products (10.2%)
St Laurent Paperboard, Inc.-/- ............................ CAN 15,800 181,973 1.8
MacMillan Bloedel Ltd. .................................... CAN 14,700 156,819 1.5
Noranda, Inc. ............................................. CAN 8,115 140,056 1.4
Bowater, Inc. ............................................. US 2,500 118,125 1.1
Noranda Forest, Inc. ...................................... CAN 19,892 104,752 1.0
Tembec, Inc. "A"-/- ....................................... CAN 18,800 97,085 0.9
Stora Kopparbergs Bergslags Aktiebolag (STORA) "A" ........ SWDN 5,920 93,214 0.9
Doman Industries Ltd. "B"-/- .............................. CAN 32,475 88,265 0.9
Alliance Forest Products, Inc.-/- ......................... CAN 4,800 72,569 0.7
------------
1,052,858
------------
Building Materials & Components (7.5%)
USG Corp. ................................................. US 5,700 308,513 3.0
Medusa Corp. .............................................. US 4,209 264,115 2.6
Martin Marietta Materials, Inc. ........................... US 4,400 198,000 1.9
------------
770,628
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F41
<PAGE>
GT GLOBAL VARIABLE NATURAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Energy Equipment & Services (6.3%)
Enerflex Systems Ltd. ..................................... CAN 8,000 $ 198,410 1.9
Core Laboratories N.V.-/-{\/} ............................. NETH 5,600 121,100 1.2
Western Atlas, Inc.-/- .................................... US 1,000 84,875 0.8
Mitcham Industries, Inc.-/- ............................... US 7,200 84,150 0.8
Key Energy Group, Inc.-/- ................................. US 6,200 81,375 0.8
Fred Olsen Energy ASA-/- .................................. NOR 5,800 77,237 0.8
------------
647,147
------------
Metals - Steel (4.8%)
IPSCO, Inc. ............................................... CAN 8,250 224,230 2.2
Stelco, Inc. "A" .......................................... CAN 19,230 137,198 1.3
British Steel PLC - ADR{\/} ............................... UK 5,700 129,675 1.3
------------
491,103
------------
Metals - Non-Ferrous (4.2%)
Phelps Dodge Corporation .................................. US 2,100 120,094 1.2
Freeport-McMoRan Copper & Gold, Inc. "B" .................. US 7,600 115,425 1.1
Inmet Mining Corp.-/- ..................................... CAN 29,000 94,584 0.9
Sutton Resources Ltd.-/- .................................. CAN 8,921 50,615 0.5
Western Copper Holdings Ltd.-/- ........................... CAN 13,993 48,491 0.5
------------
429,209
------------
Construction (4.1%)
J. Ray McDermott S.A.-/- .................................. US 3,600 149,400 1.5
Stolt Comex Seaway S.A.: .................................. UK -- -- 1.0
Common-/- {\/} .......................................... -- 3,500 67,813 --
ADR-/- .................................................. -- 1,750 30,625 --
Global Industries Ltd.-/- ................................. US 5,400 91,125 0.9
Coflexip - ADR{\/} ........................................ FR 1,150 70,294 0.7
------------
409,257
------------
Misc. Materials & Commodities (3.3%)
EdperBrascan Corp. "A" .................................... CAN 15,827 265,629 2.6
Republic Services, Inc. "A"-/- ............................ US 2,900 69,600 0.7
------------
335,229
------------
Business & Public Services (2.6%)
American Disposal Services, Inc.-/- ....................... US 5,800 271,875 2.6
------------
Gas Production & Distribution (1.8%)
Coastal Corp. ............................................. US 2,700 188,494 1.8
------------
Paper/Packaging (1.6%)
Stone Container Corp.-/- .................................. US 10,600 165,625 1.6
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F42
<PAGE>
GT GLOBAL VARIABLE NATURAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Consumer Services (0.6%)
United Road Services, Inc.-/- ............................. US 3,000 $ 57,375 0.6
------------ -----
TOTAL EQUITY INVESTMENTS (cost $9,764,663) .................. 9,224,949 89.8
------------ -----
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated June 30, 1998, with State Street Bank & Trust Co.,
due July 1, 1998, for an effective yield of 5.70%,
collateralized by $1,080,000 U.S. Treasury Bills, 5.875%
due 1/31/99 (market value of collateral is $1,108,350,
including accrued interest). (cost $1,086,000) ........... 1,086,000 10.6
------------ -----
TOTAL INVESTMENTS (cost $10,850,663) * ..................... 10,310,949 100.4
Other Assets and Liabilities ................................ (38,524) (0.4)
------------ -----
NET ASSETS .................................................. $ 10,272,425 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
{\/} U.S. currency denominated.
{.} Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
* For Federal income tax purposes, cost is $10,930,050 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 369,294
Unrealized depreciation: (988,395)
-------------
Net unrealized depreciation: $ (619,101)
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depositary Receipt
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1998, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET
ASSETS {D}
---------------------
SHORT-TERM
&
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY OTHER TOTAL
- -------------------------------------- ------ ----- -----
<S> <C> <C> <C>
Australia (AUSL/AUD) ................. 1.2 1.2
Canada (CAN/CAD) ..................... 28.1 28.1
France (FR/FRF) ...................... 5.4 5.4
Germany (GER/DEM) .................... 3.1 3.1
Italy (ITLY/ITL) ..................... 3.6 3.6
Netherlands (NETH/NLG) ............... 2.8 2.8
Norway (NOR/NOK) ..................... 0.8 0.8
Sweden (SWDN/SEK) .................... 0.9 0.9
United Kingdom (UK/GBP) .............. 4.1 4.1
United States (US/USD) ............... 39.8 10.2 50.0
------ ----- -----
Total ............................... 89.8 10.2 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $10,272,425.
The accompanying notes are an integral part of the financial statements.
F43
<PAGE>
GT GLOBAL VARIABLE AMERICA FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Services (48.0%)
Outdoor Systems, Inc.-/- .................................. US 110,450 $ 3,092,597 6.8
BUSINESS & PUBLIC SERVICES
Clear Channel Communications, Inc.-/- ..................... US 24,019 2,621,073 5.7
BROADCASTING & PUBLISHING
Snyder Communications, Inc.-/- ............................ US 57,600 2,534,400 5.5
BUSINESS & PUBLIC SERVICES
Hilton Hotels Corp. ....................................... US 63,100 1,798,350 3.9
LEISURE & TOURISM
Chancellor Media Corp.-/- ................................. US 31,000 1,539,344 3.4
BROADCASTING & PUBLISHING
Premier Parks, Inc. ....................................... US 20,000 1,332,500 2.9
LEISURE & TOURISM
The ServiceMaster Co. ..................................... US 29,600 1,126,650 2.5
CONSUMER SERVICES
Central Parking Corp. ..................................... US 24,600 1,119,300 2.4
CONSUMER SERVICES
Cablevision Systems Corp. "A" ............................. US 12,000 1,002,000 2.2
CABLE TELEVISION
Young & Rubicam, Inc. ..................................... US 30,300 969,600 2.1
BUSINESS & PUBLIC SERVICES
Keane, Inc. ............................................... US 17,000 952,000 2.1
BUSINESS & PUBLIC SERVICES
Cambridge Technology Partners, Inc. ....................... US 15,300 835,763 1.8
BUSINESS & PUBLIC SERVICES
Univision Communications, Inc.-/- ......................... US 21,500 800,875 1.8
BROADCASTING & PUBLISHING
Lamar Advertising Co.-/- .................................. US 20,300 728,263 1.6
BUSINESS & PUBLIC SERVICES
Personnel Group of America, Inc.-/- ....................... US 33,400 668,000 1.5
BUSINESS & PUBLIC SERVICES
Jacor Communications, Inc. ................................ US 8,700 513,300 1.1
BROADCASTING & PUBLISHING
Paychex, Inc. ............................................. US 8,400 341,775 0.7
BUSINESS & PUBLIC SERVICES
------------
21,975,790
------------
Technology (14.2%)
Sterling Commerce, Inc.-/- ................................ US 29,900 1,450,150 3.2
SOFTWARE
Software AG Systems, Inc.-/- .............................. US 37,000 1,082,250 2.4
SOFTWARE
Aspen Technology, Inc.-/- ................................. US 17,500 883,750 1.9
SOFTWARE
SunGard Data Systems, Inc. ................................ US 22,000 844,250 1.8
SOFTWARE
Platinum Technology, Inc.-/- .............................. US 29,300 836,881 1.8
SOFTWARE
Peoplesoft, Inc.-/- ....................................... US 15,300 719,100 1.6
SOFTWARE
</TABLE>
The accompanying notes are an integral part of the financial statements.
F44
<PAGE>
GT GLOBAL VARIABLE AMERICA FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Technology (Continued)
Ciena Corp.-/- ............................................ US 10,000 $ 696,250 1.5
TELECOM TECHNOLOGY
------------
6,512,631
------------
Finance (13.3%)
Exel Ltd. ................................................. US 13,500 1,050,469 2.3
INSURANCE - PROPERTY-CASUALTY
Golden State Bancorp, Inc. ................................ US 35,000 1,041,250 2.3
SAVINGS & LOANS
GreenPoint Financial Corp. ................................ US 23,800 895,475 2.0
SAVINGS & LOANS
The CIT Group, Inc. "A"-/- ................................ US 23,100 866,250 1.9
OTHER FINANCIAL
Capital One Financial Corp. ............................... US 6,600 819,638 1.8
CONSUMER FINANCE
Ace Ltd. .................................................. US 17,000 663,000 1.5
INSURANCE - PROPERTY-CASUALTY
Heller Financial, Inc.-/- ................................. US 22,100 663,000 1.5
OTHER FINANCIAL
------------
5,999,082
------------
Health Care (7.8%)
Forest Laboratories, Inc. "A"-/- .......................... US 25,100 897,325 2.0
PHARMACEUTICALS
Wellpoint Health Networks - New ........................... US 11,200 828,800 1.8
HEALTH CARE SERVICES
ALZA Corp. ................................................ US 15,500 670,375 1.5
PHARMACEUTICALS
HBO & Co. ................................................. US 18,000 634,500 1.4
HEALTH CARE SERVICES
McKesson Corp. ............................................ US 6,200 503,750 1.1
HEALTH CARE SERVICES
------------
3,534,750
------------
Consumer Non-Durables (6.7%)
U.S. Foodservice .......................................... US 53,600 1,879,350 4.1
FOOD
Suiza Foods Corp.-/- ...................................... US 15,000 895,313 2.0
FOOD
International Home Foods, Inc.-/- ......................... US 12,100 275,275 0.6
FOOD
------------
3,049,938
------------
Materials/Basic Industry (5.2%)
International Specialty Products, Inc.-/- ................. US 60,900 1,134,263 2.5
CHEMICALS
Millenium Chemicals, Inc. ................................. US 20,400 691,050 1.5
CHEMICALS
</TABLE>
The accompanying notes are an integral part of the financial statements.
F45
<PAGE>
GT GLOBAL VARIABLE AMERICA FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Materials/Basic Industry (Continued)
Crompton & Knowles Corp. .................................. US 22,300 $ 561,681 1.2
CHEMICALS
------------
2,386,994
------------
Capital Goods (4.3%)
U.S. Filter Corp.-/- ...................................... US 38,812 1,089,162 2.4
ENVIRONMENTAL
J. Ray McDermott S.A.-/- .................................. US 20,500 850,750 1.9
CONSTRUCTION
------------
1,939,912
------------
Energy (1.0%)
Anadarko Petroleum Corp. .................................. US 7,100 477,031 1.0
ENERGY SOURCES
------------ -----
TOTAL EQUITY INVESTMENTS (cost $37,310,913) ................. 45,876,128 100.5
------------ -----
<CAPTION>
NO. OF VALUE % OF NET
WARRANTS COUNTRY WARRANTS (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Golden State Bancorp. Litigation Warrants (cost
$210,566) ................................................ US 35,000 185,938 0.4
------------ -----
SAVINGS & LOANS
TOTAL INVESTMENTS (cost $37,521,479) * ..................... 46,062,066 100.9
Other Assets and Liabilities ................................ (398,798) (0.9)
------------ -----
NET ASSETS .................................................. $ 45,663,268 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
* For Federal income tax purposes, cost is $37,623,256 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 8,845,013
Unrealized depreciation: (406,203)
-------------
Net unrealized appreciation: $ 8,438,810
-------------
-------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F46
<PAGE>
GT GLOBAL VARIABLE NEW PACIFIC FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Services (29.4%)
News Corp., Ltd. Preferred ................................ AUSL 81,500 $ 578,892 5.0
BROADCASTING & PUBLISHING
Hong Kong Telecommunications Ltd. ......................... HK 300,000 563,408 4.8
TELEPHONE NETWORKS
Telstra Corp. Ltd. - Installment Receipts ................. AUSL 176,000 452,403 3.9
TELEPHONE NETWORKS
Brambles Industries Ltd. .................................. AUSL 16,000 314,814 2.7
BUSINESS & PUBLIC SERVICES
China Telecom (Hong Kong) Ltd. ............................ HK 178,000 309,016 2.6
WIRELESS COMMUNICATIONS
Woolworths Ltd. ........................................... AUSL 75,450 245,941 2.1
RETAILERS-OTHER
Philippine Long Distance Telephone Co. .................... PHIL 10,590 242,422 2.1
TELEPHONE - LONG DISTANCE
TABCORP Holdings Ltd. ..................................... AUSL 46,162 236,456 2.0
LEISURE & TOURISM
Singapore Press Holdings Ltd. ............................. SING 30,624 204,946 1.8
BROADCASTING & PUBLISHING
Telekom Malaysia Bhd. ..................................... MAL 71,000 119,889 1.0
TELEPHONE NETWORKS
Telecom Corporation of New Zealand Ltd. - Installment
Receipts ................................................. NZ 32,400 69,244 0.6
TELEPHONE NETWORKS
Malaysia International Shipping Bhd. - Foreign ............ MAL 37,000 53,998 0.5
TRANSPORTATION - SHIPPING
Berjaya Sports Toto Bhd. .................................. MAL 23,000 34,121 0.3
LEISURE & TOURISM
------------
3,425,550
------------
Finance (21.8%)
National Australia Bank Ltd. .............................. AUSL 42,450 561,396 4.8
BANKS-REGIONAL
Australia & New Zealand Banking Group Ltd. ................ AUSL 73,150 505,955 4.3
BANKS-REGIONAL
HSBC Holdings PLC ......................................... HK 16,268 397,907 3.4
BANKS-MONEY CENTER
Hang Seng Bank ............................................ HK 65,000 367,473 3.1
BANKS-MONEY CENTER
Development Bank of Singapore - Foreign ................... SING 59,800 331,140 2.8
BANKS-MONEY CENTER
Overseas-Chinese Banking Corp., Ltd. - Foreign ............ SING 83,000 282,647 2.4
BANKS-REGIONAL
AMP Ltd.-/- ............................................... AUSL 9,800 115,001 1.0
INSURANCE-LIFE
------------
2,561,519
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F47
<PAGE>
GT GLOBAL VARIABLE NEW PACIFIC FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Multi-Industry/Miscellaneous (9.2%)
Hutchison Whampoa ......................................... HK 100,000 $ 527,912 4.5
MULTI-INDUSTRY
Ocean-Land Group Ltd. ..................................... HK 818,000 158,374 1.4
MULTI-INDUSTRY
Shanghai Industrial Holdings Ltd. ......................... HK 58,000 136,625 1.2
MULTI-INDUSTRY
Beijing Enterprises Holdings Ltd.-/- ...................... HK 87,000 131,946 1.1
MULTI-INDUSTRY
Pacific Dunlop Ltd. ....................................... AUSL 71,800 116,353 1.0
MULTI-INDUSTRY
------------
1,071,210
------------
Materials/Basic Industry (9.0%)
Broken Hill Proprietary Co., Ltd. ......................... AUSL 46,500 394,092 3.4
MISC. MATERIALS & COMMODITIES
CSR Ltd. .................................................. AUSL 100,700 291,358 2.5
BUILDING MATERIALS & COMPONENTS
Rio Tinto Ltd. ............................................ AUSL 22,700 270,607 2.3
MISC. MATERIALS & COMMODITIES
Capral Aluminum Ltd. ...................................... AUSL 67,250 94,783 0.8
METALS - NON-FERROUS
------------
1,050,840
------------
Energy (7.7%)
CLP Holdings Ltd. ......................................... HK 98,000 446,518 3.8
ELECTRICAL & GAS UTILITIES
Manila Electric Co. "B" ................................... PHIL 78,670 208,523 1.8
ELECTRICAL & GAS UTILITIES
Electricity Generating Public Co., Ltd. - Foreign-/- ...... THAI 71,000 110,332 0.9
ELECTRICAL & GAS UTILITIES
PTT Exploration and Production Public Co., Ltd. -
Foreign-/- ............................................... THAI 13,200 100,214 0.9
OIL
YTL Power International Bhd.-/- ........................... MAL 72,000 39,252 0.3
ENERGY SOURCES
------------
904,839
------------
Consumer Durables (4.8%)
New World Development Co., Ltd. ........................... HK 125,000 242,014 2.1
HOUSING
Cheung Kong (Holdings) Ltd. ............................... HK 40,000 196,709 1.7
HOUSING
City Developments Ltd. .................................... SING 40,000 111,815 1.0
HOUSING
------------
550,538
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F48
<PAGE>
GT GLOBAL VARIABLE NEW PACIFIC FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Capital Goods (2.8%)
Cheung Kong Infrastructure Holdings ....................... HK 100,000 $ 189,093 1.6
CONSTRUCTION
New World Infrastructure Ltd.-/- .......................... HK 126,000 144,743 1.2
CONSTRUCTION
------------
333,836
------------
Consumer Non-Durables (2.2%)
Foster's Brewing Group Ltd. ............................... AUSL 107,700 254,104 2.2
------------
BEVERAGES - ALCOHOLIC
Health Care (0.5%)
Cochlear Ltd. ............................................. AUSL 16,000 62,287 0.5
HEALTH CARE SERVICES
------------ -----
TOTAL EQUITY INVESTMENTS (cost $12,826,686) ................. 10,214,723 87.4
------------ -----
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated June 30, 1998, with State Street Bank & Trust Co.,
due July 1, 1998, for an effective yield of 5.70%,
collateralized by $1,260,000 U.S. Treasury Notes, 5.875%
due 8/31/99 (market value of collateral is $1,288,479,
including accrued interest). (cost $1,260,000) ........... 1,260,000 10.8
------------ -----
TOTAL INVESTMENTS (cost $14,086,686) * ..................... 11,474,723 98.2
Other Assets and Liabilities ................................ 216,290 1.8
------------ -----
NET ASSETS .................................................. $ 11,691,013 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
* For Federal income tax purposes, cost is $14,174,944 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 408,689
Unrealized depreciation: (3,108,910)
-------------
Net unrealized depreciation: $ (2,700,221)
-------------
-------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F49
<PAGE>
GT GLOBAL VARIABLE NEW PACIFIC FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1998, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET
ASSETS {D}
---------------------
SHORT-TERM
&
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY OTHER TOTAL
- -------------------------------------- ------ ----- -----
<S> <C> <C> <C>
Australia (AUSL/AUD) ................. 38.5 38.5
Hong Kong (HK/HKD) ................... 32.5 32.5
Malaysia (MAL/MYR) ................... 2.1 2.1
New Zealand (NZ/NZD) ................. 0.6 0.6
Philippines (PHIL/PHP) ............... 3.9 3.9
Singapore (SING/SGD) ................. 8.0 8.0
Thailand (THAI/THB) .................. 1.8 1.8
United States (US/USD) ............... 12.6 12.6
------ ----- -----
Total ............................... 87.4 12.6 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $11,691,013.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACT OUTSTANDING
JUNE 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE CONTRACT DELIVERY UNREALIZED
CONTRACT TO SELL: (U.S. DOLLARS) PRICE DATE APPRECIATION
- ---------------------------------------- -------------- ----------- -------- --------------
<S> <C> <C> <C> <C>
Australian Dollars...................... 1,359,743 1.52036 7/14/98 $ 80,707
-------------- --------------
Total Contract to Sell (Receivable
amount $1,440,450)..................... 1,359,743 80,707
-------------- --------------
THE VALUE OF CONTRACT TO SELL AS
PERCENTAGE OF NET ASSETS IS 11.63%.
Total Open Forward Foreign Currency
Contract............................. $ 80,707
--------------
--------------
</TABLE>
- ----------------
See Note 1 to the financial statements.
The accompanying notes are an integral part of the financial statements.
F50
<PAGE>
GT GLOBAL VARIABLE EUROPE FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Finance (33.8%)
ING Groep N.V. ............................................ NETH 24,086 $ 1,578,244 3.8
BANKS-MONEY CENTER
UBS AG - Registered ....................................... SWTZ 3,952 1,470,771 3.6
BANKS-MONEY CENTER
ForeningsSparbanken AB .................................... SWDN 45,451 1,368,577 3.3
BANKS-REGIONAL
Axa - UAP ................................................. FR 11,400 1,282,340 3.1
INSURANCE - MULTI-LINE
Banque Nationale de Paris ................................. FR 12,000 980,613 2.4
BANKS-MONEY CENTER
Zurich Versicherungsgesellschaft .......................... SWTZ 1,500 958,036 2.3
INSURANCE - MULTI-LINE
CGU PLC ................................................... UK 50,183 936,796 2.3
INSURANCE - MULTI-LINE
Nordbanken Holding AB ..................................... SWDN 119,165 874,619 2.1
BANKS-REGIONAL
National Westminster Bank PLC ............................. UK 46,530 832,086 2.0
BANKS-MONEY CENTER
Lloyds TSB Group PLC ...................................... UK 55,830 781,657 1.9
BANKS-REGIONAL
Safra Republic Holdings S.A.{\/} .......................... LUX 8,600 645,000 1.6
OTHER FINANCIAL
Royal & Sun Alliance Insurance Group PLC .................. UK 59,500 615,466 1.5
INSURANCE - MULTI-LINE
BPI-SGPS S.A. ............................................. PORT 17,550 566,838 1.4
BANKS-MONEY CENTER
Halifax PLC ............................................... UK 43,200 561,189 1.3
BANKS-REGIONAL
Abbey National PLC ........................................ UK 27,999 497,895 1.2
BANKS-SUPER REGIONAL
------------
13,950,127
------------
Services (16.9%)
Orange PLC-/- ............................................. UK 115,800 1,227,801 3.0
WIRELESS COMMUNICATIONS
VNU (Verenigde Nederlandse Uitgeversbedrijven Verenigd
Bezit) ................................................... NETH 32,500 1,181,498 2.9
BROADCASTING & PUBLISHING
Telecom Italia SpA ........................................ ITLY 159,460 1,165,920 2.8
TELEPHONE NETWORKS
Vodafone Group PLC ........................................ UK 90,000 1,142,845 2.8
WIRELESS COMMUNICATIONS
Telecel - Comunicacaoes Pessoais S.A. ..................... PORT 4,807 854,300 2.1
WIRELESS COMMUNICATIONS
Koninklijke Ahold N.V. .................................... NETH 19,367 622,130 1.5
RETAILERS-FOOD
Helsingin Puhelin Oyj (Helsinki Telephone Corp.) .......... FIN 9,800 456,247 1.1
TELEPHONE NETWORKS
STET Hellas Telecommunications S.A. - ADR-/- {\/} ......... GREC 6,870 285,105 0.7
TELECOM - OTHER
------------
6,935,846
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F51
<PAGE>
GT GLOBAL VARIABLE EUROPE FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Consumer Non-Durables (14.4%)
Nestle S.A. - Registered .................................. SWTZ 600 $ 1,285,036 3.1
FOOD
Heineken N.V. ............................................. NETH 25,937 1,019,464 2.5
BEVERAGES - ALCOHOLIC
Cadbury Schweppes PLC ..................................... UK 63,500 983,407 2.4
BEVERAGES - NON-ALCOHOLIC
Gucci Group - NY Registered Shares{\/} .................... NETH 17,800 943,400 2.3
TEXTILES & APPAREL
Oyj Hartwall Abp "A" ...................................... FIN 26,500 851,514 2.1
BEVERAGES - ALCOHOLIC
Reckitt & Colman PLC ...................................... UK 44,320 846,587 2.0
HOUSEHOLD PRODUCTS
------------
5,929,408
------------
Health Care (13.5%)
Novartis AG ............................................... SWTZ 620 1,032,515 2.5
PHARMACEUTICALS
Roche Holding AG .......................................... SWTZ 90 884,501 2.1
PHARMACEUTICALS
Glaxo Wellcome PLC ........................................ UK 28,189 846,753 2.0
PHARMACEUTICALS
Astra AB "A" .............................................. SWDN 40,490 828,037 2.0
PHARMACEUTICALS
Nycomed Amersham PLC ...................................... UK 97,196 724,223 1.7
PHARMACEUTICALS
SmithKline Beecham PLC .................................... UK 57,560 703,041 1.7
PHARMACEUTICALS
Genset - ADR-/- {\/} ...................................... FR 18,804 552,368 1.3
BIOTECHNOLOGY
Nearmedic Ltd.-/- ......................................... ASTRI 71,100 72,871 0.2
PHARMACEUTICALS
------------
5,644,309
------------
Capital Goods (8.7%)
Nokia Oyj "A" ............................................. FIN 26,020 1,923,961 4.6
TELECOM EQUIPMENT
Alcatel Alsthom Compagnie Generale d'Electricite .......... FR 4,850 987,618 2.4
TELECOM EQUIPMENT
Coflexip - ADR{\/} ........................................ FR 11,300 690,713 1.7
CONSTRUCTION
------------
3,602,292
------------
Energy (6.9%)
Viag AG ................................................... GER 1,510 1,040,051 2.5
ELECTRICAL & GAS UTILITIES
Petroleum Geo-Services ASA-/- ............................. NOR 31,260 975,408 2.4
ENERGY EQUIPMENT & SERVICES
</TABLE>
The accompanying notes are an integral part of the financial statements.
F52
<PAGE>
GT GLOBAL VARIABLE EUROPE FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Energy (Continued)
Ente Nazionale Idrocarburi (ENI) S.p.A. ................... ITLY 127,880 $ 833,718 2.0
OIL
------------
2,849,177
------------
Technology (5.8%)
Baan Company N.V.-/- {\/} ................................. NETH 26,000 929,500 2.2
SOFTWARE
Misys PLC ................................................. UK 13,814 785,384 1.9
SOFTWARE
Computacenter PLC-/- ...................................... UK 55,800 697,849 1.7
COMPUTERS & PERIPHERALS
------------
2,412,733
------------
Materials/Basic Industry (2.5%)
Akzo Nobel N.V. ........................................... NETH 4,600 1,023,278 2.5
------------
CHEMICALS
Consumer Durables (2.4%)
Volvo AB "B" .............................................. SWDN 33,020 983,909 2.4
AUTOMOBILES
------------ -----
TOTAL EQUITY INVESTMENTS (cost $31,454,366) ................. 43,331,079 104.9
------------ -----
TOTAL INVESTMENTS (cost $31,454,366) * ..................... 43,331,079 104.9
Other Assets and Liabilities ................................ (2,008,435) (4.9)
------------ -----
NET ASSETS .................................................. $ 41,322,644 100.0
------------ -----
------------ -----
</TABLE>
- --------------
{\/} U.S. currency denominated.
-/- Non-income producing security.
* For Federal income tax purposes, cost is $31,454,366 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 12,382,550
Unrealized depreciation: (505,837)
-------------
Net unrealized appreciation: $ 11,876,713
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depositary Receipt
The accompanying notes are an integral part of the financial statements.
F53
<PAGE>
GT GLOBAL VARIABLE EUROPE FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1998, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS
{D}
---------------------------
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY OTHER TOTAL
- -------------------------------------- ------ ---------- -----
<S> <C> <C> <C>
Austria (ASTRI/ATS) .................. 0.2 0.2
Finland (FIN/FIM) .................... 7.8 7.8
France (FR/FRF) ...................... 10.9 10.9
Germany (GER/DEM) .................... 2.5 2.5
Greece (GREC/GRD) .................... 0.7 0.7
Italy (ITLY/ITL) ..................... 4.8 4.8
Luxembourg (LUX/LUF) ................. 1.6 1.6
Netherlands (NETH/NLG) ............... 17.7 17.7
Norway (NOR/NOK) ..................... 2.4 2.4
Portugal (PORT/PTE) .................. 3.5 3.5
Sweden (SWDN/SEK) .................... 9.8 9.8
Switzerland (SWTZ/CHF) ............... 13.6 13.6
United Kingdom (UK/GBP) .............. 29.4 29.4
United States (US/USD) ............... (4.9) (4.9)
------ ----- -----
Total ............................... 104.9 (4.9) 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $41,322,644.
The accompanying notes are an integral part of the financial statements.
F54
<PAGE>
GT GLOBAL MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MATURITY PRINCIPAL VALUE % OF NET
SHORT-TERM INVESTMENTS YIELD DATE AMOUNT (NOTE 1) ASSETS
- ----------------------------------------------------------------- --------- --------- ----------- ------------ -------------
<S> <C> <C> <C> <C> <C>
Commercial Paper - Discounted (46.6%)
Kingdom of Sweden ............................................. 5.52% 06-Jul-98 1,000,000 $ 999,246 3.2
Motorola Inc. ................................................. 5.52% 13-Jul-98 1,000,000 998,177 3.2
International Lease Finance Corp. ............................. 5.53% 17-Jul-98 1,000,000 997,587 3.2
Household Finance Corp. ....................................... 5.54% 20-Jul-98 1,000,000 997,103 3.2
Coca Cola Co. ................................................. 5.55% 28-Jul-98 1,000,000 995,897 3.2
Shell Oil Co. ................................................. 5.52% 27-Aug-98 1,000,000 991,355 3.2
General Electric Co. .......................................... 5.56% 28-Aug-98 1,000,000 991,268 3.2
John Deere Capital Corp. ...................................... 5.57% 11-Sep-98 1,000,000 989,140 3.1
Minnesota Mining & Manufacturing Co. .......................... 5.61% 22-Sep-98 1,000,000 987,365 3.1
United States Automobile Association Capital Corp. ............ 5.58% 25-Sep-98 1,000,000 986,861 3.1
Walt Disney Co. ............................................... 5.58% 21-Oct-98 1,000,000 983,106 3.1
E.I. Dupont de Nemours & Co. .................................. 5.59% 21-Oct-98 1,000,000 983,075 3.1
American Express Credit Corp. ................................. 5.58% 23-Oct-98 1,000,000 982,742 3.1
Associates Corp. .............................................. 5.58% 09-Nov-98 1,000,000 980,168 3.1
Ford Motor Credit Corp. ....................................... 5.51% 11-Aug-98 800,000 795,116 2.5
------------ -----
Total Commercial Paper - Discounted (amortized cost
$14,658,206) ................................................... 14,658,206 46.6
------------ -----
Government & Government Agency Obligations (7.9%)
United States Treasury Bills .................................. 4.91% 20-Aug-98 2,500,000 2,483,160 7.9
------------ -----
Total Government & Government Agency Obligations (amortized cost
$2,483,160) .................................................... 2,483,160 7.9
------------ -----
TOTAL SHORT-TERM INVESTMENTS (cost $17,141,366) ................. 17,141,366 54.5
------------ -----
<CAPTION>
REPURCHASE AGREEMENTS
- -----------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Dated June 30, 1998, with State Street Bank & Trust Co., due
July 1, 1998, for an effective yield of 5.70%, collateralized
by $6,225,000 U.S. Treasury Bills, 5.875% due 1/31/99 (market
value of collateral is $6,388,406, including accrued
interest). .................................................. 6,262,000 19.9
Dated June 30, 1998, with BancAmerica Robertson Stephens, due
July 1, 1998, for an effective yield of 5.55%, collateralized
by $5,325,000 U.S. Treasury Bonds, 8.75% due 11/15/08 (market
value of collateral is $6,131,659, including accrued
interest). ................................................... 6,000,000 19.1
------------ -----
TOTAL REPURCHASE AGREEMENTS (cost $12,262,000) .................. 12,262,000 39.0
------------ -----
TOTAL SHORT-TERM INVESTMENTS (cost $29,403,366) * .............. 29,403,366 93.5
Other Assets and Liabilities .................................... 2,057,714 6.5
------------ -----
NET ASSETS ...................................................... $ 31,461,080 100.0
------------ -----
------------ -----
</TABLE>
- --------------
* For Federal income tax purposes, cost is $29,403,366
The accompanying notes are an integral part of the financial statements.
F55
<PAGE>
GT GLOBAL VARIABLE INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Finance (27.4%)
UBS AG - Registered-/- .................................... SWTZ 522 $ 194,167 2.6
BANKS-MONEY CENTER
Nordbanken Holding AB ..................................... SWDN 22,830 167,562 2.2
BANKS-REGIONAL
Australia & New Zealand Banking Group Ltd. ................ AUSL 20,400 141,100 1.9
BANKS-REGIONAL
Abbey National PLC ........................................ UK 7,740 137,637 1.8
BANKS-SUPER REGIONAL
ForeningsSparbanken AB .................................... SWDN 4,220 127,069 1.7
BANKS-REGIONAL
Axa - UAP ................................................. FR 970 109,111 1.5
INSURANCE - MULTI-LINE
Lloyds TSB Group PLC ...................................... UK 7,450 104,305 1.4
BANKS-REGIONAL
Royal & Sun Alliance Insurance Group PLC .................. UK 9,900 102,405 1.4
INSURANCE - MULTI-LINE
Zurich Versicherungsgesellschaft .......................... SWTZ 150 95,804 1.3
INSURANCE - MULTI-LINE
ING Groep N.V. ............................................ NETH 1,420 93,046 1.2
BANKS-MONEY CENTER
National Westminster Bank PLC ............................. UK 4,400 78,684 1.1
BANKS-MONEY CENTER
M & G Group PLC ........................................... UK 2,800 75,622 1.0
INVESTMENT MANAGEMENT
Schroders PLC ............................................. UK 2,830 73,054 1.0
BANKS-MONEY CENTER
Banque Nationale de Paris ................................. FR 871 71,176 1.0
BANKS-MONEY CENTER
HSBC Holdings PLC ......................................... HK 2,872 70,248 0.9
BANKS-MONEY CENTER
State Bank of India Ltd. - Reg S GDR-/- {c} {\/} .......... IND 5,650 66,670 0.9
BANKS-REGIONAL
CGU PLC ................................................... UK 3,400 63,470 0.8
INSURANCE - MULTI-LINE
Royal Bank of Canada ...................................... CAN 1,000 60,135 0.8
BANKS-REGIONAL
Safra Republic Holdings S.A.{\/} .......................... LUX 760 57,000 0.8
OTHER FINANCIAL
BPI-SGPS S.A. ............................................. PORT 1,630 52,646 0.7
BANKS-MONEY CENTER
Kokusai Securities Co., Ltd. .............................. JPN 5,000 49,541 0.7
SECURITIES BROKER
Nichiei Co., Ltd. ......................................... JPN 600 40,963 0.5
OTHER FINANCIAL
United Overseas Bank Ltd. - Foreign ....................... SING 5,400 16,790 0.2
BANKS-MONEY CENTER
------------
2,048,205
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F56
<PAGE>
GT GLOBAL VARIABLE INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Services (18.7%)
Telecom Italia SpA ........................................ ITLY 26,140 $ 191,127 2.6
TELEPHONE NETWORKS
Orange PLC-/- ............................................. UK 15,450 163,813 2.2
WIRELESS COMMUNICATIONS
EMI Group PLC ............................................. UK 15,650 136,928 1.8
LEISURE & TOURISM
Telecom Corporation of New Zealand Ltd. ................... NZ 29,800 123,037 1.6
TELEPHONE NETWORKS
Woolworths Ltd. ........................................... AUSL 34,650 112,947 1.5
RETAILERS-OTHER
Telecomunicacoes Brasileiras S.A. (Telebras) - ADR{\/} .... BRZL 900 98,269 1.3
TELEPHONE NETWORKS
EMAP PLC .................................................. UK 4,500 91,067 1.2
BROADCASTING & PUBLISHING
Reuters Group PLC ......................................... UK 7,806 89,282 1.2
BROADCASTING & PUBLISHING
Vodafone Group PLC ........................................ UK 6,894 87,542 1.2
WIRELESS COMMUNICATIONS
Koninklijke Ahold N.V. .................................... NETH 2,296 73,755 1.0
RETAILERS-FOOD
Great Universal Stores PLC ................................ UK 5,100 67,273 0.9
RETAILERS-OTHER
Telecel - Comunicacaoes Pessoais S.A. ..................... PORT 330 58,648 0.8
WIRELESS COMMUNICATIONS
Telstra Corp. Ltd. - Installment Receipts-/- .............. AUSL 19,600 50,381 0.7
TELEPHONE NETWORKS
Amway Japan Ltd. .......................................... JPN 4,000 42,525 0.6
RETAILERS-OTHER
Telecom Corporation of New Zealand Ltd. - Installment
Receipts ................................................. NZ 2,400 5,129 0.1
TELEPHONE NETWORKS
Fast Retailing Co., Ltd. .................................. JPN 44 414 --
RETAILERS-APPAREL
------------
1,392,137
------------
Energy (8.3%)
Petroleum Geo-Services ASA-/- ............................. NOR 4,400 137,294 1.8
ENERGY EQUIPMENT & SERVICES
Viag AG ................................................... GER 192 132,245 1.8
ELECTRICAL & GAS UTILITIES
Coflexip - ADR{\/} ........................................ FR 1,500 91,688 1.2
OIL
Shell Transport & Trading Co., PLC ........................ UK 11,600 81,737 1.1
OIL
Burmah Castrol PLC ........................................ UK 3,600 64,318 0.9
OIL
Petroleo Brasileiro S.A. (Petrobras) - ADR{\/} ............ BRZL 3,240 59,940 0.8
GAS PRODUCTION & DISTRIBUTION
Ente Nazionale Idrocarburi (ENI) S.p.A. ................... ITLY 8,550 55,742 0.7
OIL
------------
622,964
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F57
<PAGE>
GT GLOBAL VARIABLE INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Consumer Non-Durables (8.0%)
Nestle S.A. - Registered .................................. SWTZ 64 $ 137,070 1.8
FOOD
Diageo PLC ................................................ UK 10,072 119,404 1.6
BEVERAGES - ALCOHOLIC
Benckiser N.V. "B"-/- ..................................... NETH 1,500 92,311 1.2
HOUSEHOLD PRODUCTS
United Biscuits (Holdings) PLC ............................ UK 22,100 88,562 1.2
FOOD
Gucci Group - NY Registered Shares{\/} .................... NETH 1,620 85,860 1.1
TEXTILES & APPAREL
Asahi Breweries Ltd. ...................................... JPN 5,000 63,282 0.8
BEVERAGES - ALCOHOLIC
South African Breweries Ltd. .............................. SAFR 990 20,402 0.3
BEVERAGES - ALCOHOLIC
------------
606,891
------------
Health Care (8.0%)
Nycomed Amersham PLC ...................................... UK 21,197 157,942 2.1
PHARMACEUTICALS
Roche Holding AG .......................................... SWTZ 14 137,589 1.8
PHARMACEUTICALS
Novartis AG ............................................... SWTZ 67 111,578 1.5
PHARMACEUTICALS
Astra AB "B" .............................................. SWDN 3,743 74,667 1.0
MEDICAL TECHNOLOGY & SUPPLIES
Richter Gedeon Rt. - Reg S GDR-/- {c} {\/} ................ HGRY 810 64,598 0.9
PHARMACEUTICALS
Takeda Chemical Industries ................................ JPN 2,000 53,374 0.7
PHARMACEUTICALS
------------
599,748
------------
Capital Goods (3.5%)
Nokia Oyj "A" ............................................. FIN 1,620 119,785 1.6
TELECOM EQUIPMENT
Alcatel Alsthom Compagnie Generale d'Electricite .......... FR 495 100,798 1.3
TELECOM EQUIPMENT
Canon, Inc. ............................................... JPN 2,000 45,563 0.6
OFFICE EQUIPMENT
------------
266,146
------------
Consumer Durables (3.4%)
Volvo AB "B" .............................................. SWDN 3,840 114,422 1.5
AUTOMOBILES
Futuris Corp., Ltd. ....................................... AUSL 90,000 79,349 1.1
AUTO PARTS
Mabuchi Motor Co., Ltd. ................................... JPN 900 57,279 0.8
AUTOMOBILES
------------
251,050
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F58
<PAGE>
GT GLOBAL VARIABLE INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Technology (1.4%)
Baan Company N.V.-/- {\/} ................................. NETH 1,460 $ 52,195 0.7
SOFTWARE
Matsushita-Kotobuki Electronics Ltd. ...................... JPN 2,000 50,047 0.7
COMPUTERS & PERIPHERALS
------------
102,242
------------
Materials/Basic Industry (1.3%)
Akzo Nobel N.V. ........................................... NETH 450 100,103 1.3
------------
CHEMICALS
Multi-Industry/Miscellaneous (0.5%)
Shanghai Industrial Holdings Ltd. ......................... HK 16,200 38,161 0.5
MULTI-INDUSTRY
------------ -----
TOTAL EQUITY INVESTMENTS (cost $5,394,600) .................. 6,027,647 80.5
------------ -----
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENTS (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated June 30, 1998, with BancAmerica Robert Stephens, due
July 1, 1998, for an effective yield of 5.20%,
collateralized by $905,000 U.S. Treasury Notes, 5.50% due
2/15/08 (market value of collateral is $932,750 including
accrued interest). ...................................... 900,000 12.0
Dated June 30, 1998, with State Street Bank & Trust Co.,
due July 1, 1998 for an effective yield of 5.70%
collateralized by $845,000 Treasury Bills, 5.875% due
1/31/99 (market value of collateral is $867,181 including
accrued interest). ...................................... 848,000 11.3
------------ -----
TOTAL REPURCHASE AGREEMENTS (cost $1,748,000) ............... 1,748,000 23.3
------------ -----
TOTAL INVESTMENTS (cost $7,142,600) * ...................... 7,775,647 103.8
Other Assets and Liabilities ................................ (287,695) (3.8)
------------ -----
NET ASSETS .................................................. $ 7,487,952 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
{\/} U.S. currency denominated.
{c} Security issued under Regulation S. Rule 144A and additional
restrictions may apply in the resale of such securities.
* For Federal income tax purposes, cost is $7,169,315 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 934,649
Unrealized depreciation: (328,317)
-------------
Net unrealized appreciation: $ 606,332
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depositary Receipt
GDR--Global Depositary Receipt
The accompanying notes are an integral part of the financial statements.
F59
<PAGE>
GT GLOBAL VARIABLE INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1998, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS
{D}
---------------------------
SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY & OTHER TOTAL
- -------------------------------------- ------ ---------- -----
<S> <C> <C> <C>
Australia (AUSL/AUD) ................. 5.2 5.2
Brazil (BRZL/BRL) .................... 2.1 2.1
Canada (CAN/CAD) ..................... 0.8 0.8
Finland (FIN/FIM) .................... 1.6 1.6
France (FR/FRF) ...................... 5.0 5.0
Germany (GER/DEM) .................... 1.8 1.8
Hong Kong (HK/HKD) ................... 1.4 1.4
Hungary (HGRY/HUF) ................... 0.9 0.9
India (IND/INR) ...................... 0.9 0.9
Italy (ITLY/ITL) ..................... 3.3 3.3
Japan (JPN/JPY) ...................... 5.4 5.4
Luxembourg (LUX/LUF) ................. 0.8 0.8
Netherlands (NETH/NLG) ............... 6.5 6.5
New Zealand (NZ/NZD) ................. 1.7 1.7
Norway (NOR/NOK) ..................... 1.8 1.8
Portugal (PORT/PTE) .................. 1.5 1.5
Singapore (SING/SGD) ................. 0.2 0.2
South Africa (SAFR/ZAR) .............. 0.3 0.3
Sweden (SWDN/SEK) .................... 6.4 6.4
Switzerland (SWTZ/CHF) ............... 9.0 9.0
United Kingdom (UK/GBP) .............. 23.9 23.9
United States (US/USD) ............... 19.5 19.5
------ ----- -----
Total ............................... 80.5 19.5 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $7,487,952.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
JUNE 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE CONTRACT DELIVERY UNREALIZED
CONTRACTS TO SELL: (U.S. DOLLARS) PRICE DATE APPRECIATION
- ---------------------------------------- -------------- ----------- -------- --------------
<S> <C> <C> <C> <C>
Deutsche Marks.......................... 69,586 1.77200 8/31/98 $ 956
French Francs........................... 182,387 5.94360 8/6/98 2,686
Japanese Yen............................ 67,260 133.28993 7/7/98 2,513
Japanese Yen............................ 138,196 130.50000 8/6/98 7,398
Japanese Yen............................ 174,716 130.86000 8/12/98 8,686
Swiss Francs............................ 136,400 1.47770 9/21/98 2,329
-------------- --------------
Total Contracts to Sell (Receivable
amount $793,113)..................... 768,545 24,568
-------------- --------------
THE VALUE OF CONTRACTS TO SELL AS
PERCENTAGE OF NET ASSETS IS 10.26%.
Total Open Forward Foreign Currency
Contracts............................ $ 24,568
--------------
--------------
</TABLE>
- ----------------
See Note 1 to the financial statements.
The accompanying notes are an integral part of the financial statements.
F60
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
STATEMENTS OF ASSETS
AND LIABILITIES
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
------------------------------------------------
VARIABLE VARIABLE
VARIABLE GLOBAL U.S. VARIABLE
STRATEGIC GOVERNMENT GOVERNMENT LATIN
INCOME INCOME INCOME AMERICA
FUND FUND FUND FUND
---------- ----------- ----------- ----------
<S> <C> <C> <C> <C>
Assets:
Investments in securities: (Note 1)
At identified cost.................. $27,302,799 $8,014,147 $6,875,062 $20,523,006
---------- ----------- ----------- ----------
---------- ----------- ----------- ----------
At value............................ $26,350,147 $8,120,355 $7,026,262 $16,073,144
Repurchase Agreements, at value and
cost (Note 1)........................ -- -- 42,000 133,000
U.S. currency......................... 324,595 -- 657 --
Foreign currencies (cost $15; $31,963;
$0; $9,764; $3,547; $202,425;
$75,699; $131,383; $0; $0; $0;
$737,899; $0; $5,178,
respectively)........................ 15 32,417 -- 10,111
Dividends and dividend withholding tax
reclaims receivable.................. -- -- -- 64,299
Interest and interest withholding tax
reclaims receivable.................. 460,660 153,471 102,454 21
Receivable for forward foreign
currency contracts -- closed (Note
1)................................... 7,073 -- -- --
Receivable for Fund shares sold....... 17,426 3,316 29 7,400
Receivable for open forward foreign
currency contracts, net (Note 1)..... 92,811 59,819 -- --
Receivable for securities sold........ 350,386 220,412 -- 183,815
Receivable from A I M Advisors, Inc.
(Note 2)............................. 27,841 23,304 16,772 25,402
Unamortized organizational costs (Note
1)................................... -- -- -- --
Miscellaneous receivable.............. 8,229 -- -- --
---------- ----------- ----------- ----------
Total assets........................ 27,639,183 8,613,094 7,188,174 16,497,192
---------- ----------- ----------- ----------
Liabilities:
Distribution payable (Note 1)......... -- -- -- --
Payable for custodian fees............ 4,820 3,172 845 10,473
Payable for forward foreign currency
contracts -- closed (Note 1)......... -- 4,167 -- --
Payable for fund accounting fees (Note
2)................................... 370 129 100 189
Payable for Fund shares repurchased... 49,574 4,877 30 20,216
Payable for investment management and
administration fees (Note 2)......... 26,116 24,952 18,034 34,413
Payable for loan outstanding (Note
1)................................... 1,000,000 189,000 -- --
Payable for printing and postage
expenses............................. 7,204 7,321 10,659 9,757
Payable for professional fees......... 3,579 5,214 7,839 3,497
Payable for registration and filing
fees................................. 782 977 965 1,327
Payable for securities purchased...... 1,797,200 -- 658,328 109,658
Payable for Trustees' fees and
expenses (Note 2).................... 2,234 2,949 1,863 1,240
Other accrued expenses................ 2,624 2,509 484 1,904
---------- ----------- ----------- ----------
Total liabilities................... 2,894,503 245,267 699,147 192,674
---------- ----------- ----------- ----------
Net assets.............................. $24,744,680 $8,367,827 $6,489,027 $16,304,518
---------- ----------- ----------- ----------
---------- ----------- ----------- ----------
Shares outstanding...................... 1,895,536 742,938 548,635 1,261,896
Net asset value per share............... $ 13.05 $ 11.26 $ 11.83 $ 12.92
---------- ----------- ----------- ----------
---------- ----------- ----------- ----------
Net assets consist of:
Paid in capital (Note 4).............. $25,065,428 $9,080,091 $6,208,412 $21,018,688
Undistributed/Accumulated net
investment income (loss)............. 485,547 124,936 72,461 225,002
Accumulated net realized gain (loss)
on investments and foreign currency
transactions......................... 46,749 (998,124) 56,954 (487,994)
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... 99,608 54,716 -- (1,316)
Net unrealized appreciation
(depreciation) of investments........ (952,652) 106,208 151,200 (4,449,862)
---------- ----------- ----------- ----------
Total -- representing net assets
applicable to capital shares
outstanding............................ $24,744,680 $8,367,827 $6,489,027 $16,304,518
---------- ----------- ----------- ----------
---------- ----------- ----------- ----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F61
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
STATEMENTS OF ASSETS
AND LIABILITIES (cont'd)
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
-----------------------------------------------------------------------------------
VARIABLE VARIABLE VARIABLE VARIABLE VARIABLE
GROWTH & TELECOM- EMERGING VARIABLE NATURAL VARIABLE NEW
INCOME MUNICATIONS MARKETS INFRASTRUCTURE RESOURCES AMERICA PACIFIC
FUND FUND FUND FUND FUND FUND FUND
---------- ---------- ---------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in securities: (Note 1)
At identified cost.................. $37,848,227 $55,389,966 $11,288,069 $6,752,971 $9,764,663 $37,521,479 $12,826,686
---------- ---------- ---------- ----------- ---------- ---------- ----------
---------- ---------- ---------- ----------- ---------- ---------- ----------
At value............................ $53,695,529 $72,161,544 $9,118,937 $7,550,513 $9,224,949 $46,062,066 $10,214,723
Repurchase Agreements, at value and
cost (Note 1)........................ 4,266,000 2,462,000 49,000 354,000 1,086,000 -- 1,260,000
U.S. currency......................... -- -- -- -- 767 746 665
Foreign currencies (cost $15; $31,963;
$0; $9,764; $3,547; $202,425;
$75,699; $131,383; $0; $0; $0;
$737,899; $0; $5,178,
respectively)........................ 4,419 203,318 70,933 132,055 -- -- --
Dividends and dividend withholding tax
reclaims receivable.................. 112,754 46,255 46,847 8,629 24,586 8,398 59,504
Interest and interest withholding tax
reclaims receivable.................. 174,955 390 1,341 56 172 -- 200
Receivable for forward foreign
currency contracts -- closed (Note
1)................................... -- -- -- -- -- -- --
Receivable for Fund shares sold....... 47,891 71,925 545,067 16,497 34,027 101,589 35,368
Receivable for open forward foreign
currency contracts, net (Note 1)..... -- 52,191 -- 15,495 -- -- 80,707
Receivable for securities sold........ 2,790,638 1,318,009 50,394 149,664 72,490 93,043 386,200
Receivable from A I M Advisors, Inc.
(Note 2)............................. -- -- 43,864 16,879 18,352 -- 32,922
Unamortized organizational costs (Note
1)................................... -- 1,904 -- -- -- -- --
Miscellaneous receivable.............. -- 2,639 -- -- -- -- --
---------- ---------- ---------- ----------- ---------- ---------- ----------
Total assets........................ 61,092,186 76,320,175 9,926,383 8,243,788 10,461,343 46,265,842 12,070,289
---------- ---------- ---------- ----------- ---------- ---------- ----------
Liabilities:
Distribution payable (Note 1)......... -- -- -- -- -- -- --
Payable for custodian fees............ 2,964 1,415 2,853 912 6,881 3,887 9,959
Payable for forward foreign currency
contracts -- closed (Note 1)......... -- -- -- -- -- -- --
Payable for fund accounting fees (Note
2)................................... 1,054 2,295 89 183 237 721 75
Payable for Fund shares repurchased... 600,793 150,445 20,019 17,098 69,875 321,113 209,373
Payable for investment management and
administration fees (Note 2)......... 46,799 59,918 36,166 20,686 23,302 26,476 37,248
Payable for loan outstanding (Note
1)................................... -- -- -- -- -- 3,000 --
Payable for printing and postage
expenses............................. 11,846 20,627 9,489 8,838 9,339 8,772 8,144
Payable for professional fees......... 1,972 2,605 11,335 887 6,681 8,429 8,033
Payable for registration and filing
fees................................. 840 1,001 859 710 710 1,256 1,133
Payable for securities purchased...... 2,751,840 199,392 37,245 -- 69,600 226,059 103,546
Payable for Trustees' fees and
expenses (Note 2).................... 2,280 1,759 2,231 1,597 1,681 2,232 892
Other accrued expenses................ 1,481 16,142 3,876 1,977 612 629 873
---------- ---------- ---------- ----------- ---------- ---------- ----------
Total liabilities................... 3,421,869 455,599 124,162 52,888 188,918 602,574 379,276
---------- ---------- ---------- ----------- ---------- ---------- ----------
Net assets.............................. $57,670,317 $75,864,576 $9,802,221 $8,190,900 $10,272,425 $45,663,268 $11,691,013
---------- ---------- ---------- ----------- ---------- ---------- ----------
---------- ---------- ---------- ----------- ---------- ---------- ----------
Shares outstanding...................... 2,751,358 3,685,356 1,125,895 457,740 783,420 2,172,519 1,424,374
Net asset value per share............... $ 20.96 $ 20.59 $ 8.71 $ 17.89 $ 13.11 $ 21.02 $ 8.21
---------- ---------- ---------- ----------- ---------- ---------- ----------
---------- ---------- ---------- ----------- ---------- ---------- ----------
Net assets consist of:
Paid in capital (Note 4).............. $39,207,974 $52,566,768 $13,843,685 $6,900,391 $13,381,029 $35,465,271 $16,777,014
Undistributed/Accumulated net
investment income (loss)............. 713,486 97,301 274,838 80,405 35,553 (132,455) 180,327
Accumulated net realized gain (loss)
on investments and foreign currency
transactions......................... 1,901,286 6,382,068 (2,143,739) 397,964 (2,604,445) 1,789,865 (2,731,860)
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... 269 46,861 (3,431) 14,598 2 -- 77,495
Net unrealized appreciation
(depreciation) of investments........ 15,847,302 16,771,578 (2,169,132) 797,542 (539,714) 8,540,587 (2,611,963)
---------- ---------- ---------- ----------- ---------- ---------- ----------
Total -- representing net assets
applicable to capital shares
outstanding............................ $57,670,317 $75,864,576 $9,802,221 $8,190,900 $10,272,425 $45,663,268 $11,691,013
---------- ---------- ---------- ----------- ---------- ---------- ----------
---------- ---------- ---------- ----------- ---------- ---------- ----------
<CAPTION>
VARIABLE MONEY VARIABLE
EUROPE MARKET INTERNATIONAL
FUND FUND FUND
---------- ---------- -----------
<S> <C> <C> <C>
Assets:
Investments in securities: (Note 1)
At identified cost.................. $31,454,366 $17,141,366 $5,394,600
---------- ---------- -----------
---------- ---------- -----------
At value............................ $43,331,079 $17,141,366 $6,027,647
Repurchase Agreements, at value and
cost (Note 1)........................ -- 12,262,000 1,748,000
U.S. currency......................... -- 201 --
Foreign currencies (cost $15; $31,963;
$0; $9,764; $3,547; $202,425;
$75,699; $131,383; $0; $0; $0;
$737,899; $0; $5,178,
respectively)........................ 738,087 -- 5,869
Dividends and dividend withholding tax
reclaims receivable.................. 104,634 -- 20,143
Interest and interest withholding tax
reclaims receivable.................. -- 1,917 264
Receivable for forward foreign
currency contracts -- closed (Note
1)................................... -- -- --
Receivable for Fund shares sold....... 54,204 3,048,293 296,834
Receivable for open forward foreign
currency contracts, net (Note 1)..... -- -- 24,568
Receivable for securities sold........ 307 -- 32,222
Receivable from A I M Advisors, Inc.
(Note 2)............................. -- 4,417 26,578
Unamortized organizational costs (Note
1)................................... -- -- --
Miscellaneous receivable.............. -- -- --
---------- ---------- -----------
Total assets........................ 44,228,311 32,458,194 8,182,125
---------- ---------- -----------
Liabilities:
Distribution payable (Note 1)......... -- 131,263 --
Payable for custodian fees............ 2,683 2,784 4,879
Payable for forward foreign currency
contracts -- closed (Note 1)......... -- -- --
Payable for fund accounting fees (Note
2)................................... 504 821 134
Payable for Fund shares repurchased... 1,545,862 832,772 619,712
Payable for investment management and
administration fees (Note 2)......... 34,192 19,567 28,197
Payable for loan outstanding (Note
1)................................... 992,000 -- --
Payable for printing and postage
expenses............................. 5,784 6,407 12,942
Payable for professional fees......... 2,190 1,584 17,611
Payable for registration and filing
fees................................. 2,017 588 1,140
Payable for securities purchased...... 306,629 -- 5,698
Payable for Trustees' fees and
expenses (Note 2).................... 738 391 1,264
Other accrued expenses................ 13,068 937 2,596
---------- ---------- -----------
Total liabilities................... 2,905,667 997,114 694,173
---------- ---------- -----------
Net assets.............................. $41,322,644 $31,461,080 $7,487,952
---------- ---------- -----------
---------- ---------- -----------
Shares outstanding...................... 1,607,515 31,461,080 567,041
Net asset value per share............... $ 25.71 $ 1.00 $ 13.21
---------- ---------- -----------
---------- ---------- -----------
Net assets consist of:
Paid in capital (Note 4).............. $27,022,053 $31,461,080 $6,531,903
Undistributed/Accumulated net
investment income (loss)............. 194,452 -- 69,100
Accumulated net realized gain (loss)
on investments and foreign currency
transactions......................... 2,231,467 -- 229,764
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... (2,041) -- 24,138
Net unrealized appreciation
(depreciation) of investments........ 11,876,713 -- 633,047
---------- ---------- -----------
Total -- representing net assets
applicable to capital shares
outstanding............................ $41,322,644 $31,461,080 $7,487,952
---------- ---------- -----------
---------- ---------- -----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F62
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
STATEMENTS OF OPERATIONS
Six months ended June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
----------------------------------------------
VARIABLE VARIABLE
VARIABLE GLOBAL U.S. VARIABLE
STRATEGIC GOVERNMENT GOVERNMENT LATIN
INCOME INCOME INCOME AMERICA
FUND FUND FUND FUND
--------- ----------- ----------- ---------
<S> <C> <C> <C> <C>
Investment income: * (Note 1)
Dividend income....................... -- -- -- $ 369,451
Interest income....................... $1,144,865 $ 303,088 $ 204,145 3,506
Securities lending income............. 28,242 4,407 -- 5,848
--------- ----------- ----------- ---------
Total investment income............. 1,173,107 307,495 204,145 378,805
--------- ----------- ----------- ---------
Expenses:
Amortization of organization costs
(Note 1)............................. 720 720 720 720
Custodian fees........................ 12,851 7,602 1,730 21,720
Fund accounting fees (Note 2)......... 3,686 1,110 827 2,928
Interest expense (Note 1)............. 16,417 2,259 1,308 18,208
Investment management and
administration fees (Note 2)......... 102,316 30,804 24,125 108,462
Printing and postage expenses......... 6,785 5,397 6,516 8,145
Professional fees..................... 36,640 17,476 13,756 17,195
Registration and filing fees.......... -- -- -- 362
Trustees' fees and expenses (Note
2)................................... 724 724 724 905
Other expenses (Note 1)............... 1,543 542 539 540
--------- ----------- ----------- ---------
Total expenses before reimbursements
and reductions..................... 181,682 66,634 50,245 179,185
--------- ----------- ----------- ---------
Expenses reimbursed by A I M
Advisors, Inc. (Note 2).......... (27,841) (23,304) (16,772) (25,402)
Expense reductions (Note 5)....... -- -- -- --
--------- ----------- ----------- ---------
Total net expenses.................. 153,841 43,330 33,473 153,783
--------- ----------- ----------- ---------
Net investment income (loss)............ 1,019,266 264,165 170,672 225,022
--------- ----------- ----------- ---------
Net realized and unrealized gain (loss)
on investments and foreign currencies:
(Note 1)
Net realized gain (loss) on
investments.......................... 260,022 (183,955) 75,297 (440,169)
Net realized gain (loss) on foreign
currency transactions................ 297,849 829,352 -- (31,646)
--------- ----------- ----------- ---------
Net realized gain (loss) during the
period............................. 557,871 645,397 75,297 (471,815)
--------- ----------- ----------- ---------
Net change in unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... (215,874) (803,018) -- (1,421)
Net change in unrealized appreciation
(depreciation) of investments........ (1,035,630) 193,751 (210) (4,716,591)
--------- ----------- ----------- ---------
Net unrealized appreciation
(depreciation) during the period... (1,251,504) (609,267) (210) (4,718,012)
--------- ----------- ----------- ---------
Net realized and unrealized gain
(loss) on investments and foreign
currencies........................... (693,633) 36,130 75,087 (5,189,827)
--------- ----------- ----------- ---------
Net increase (decrease) in net assets
resulting from operations.............. $ 325,633 $ 300,295 $ 245,759 $(4,964,805)
--------- ----------- ----------- ---------
--------- ----------- ----------- ---------
*Net of foreign withholding tax of:.... $ -- $ -- $ -- $ 35,812
--------- ----------- ----------- ---------
--------- ----------- ----------- ---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F63
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
STATEMENTS OF OPERATIONS (cont'd)
Six months ended June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
-------------------------------------------------------------------------------------------------
VARIABLE VARIABLE VARIABLE VARIABLE VARIABLE
GROWTH & TELECOM- EMERGING VARIABLE NATURAL VARIABLE NEW
INCOME MUNICATIONS MARKETS INFRASTRUCTURE RESOURCES AMERICA PACIFIC
FUND FUND FUND FUND FUND FUND FUND
------------ ------------ ----------- -------------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income: * (Note 1)
Dividend income............. $ 603,104 $ 352,749 $ 184,605 $ 108,354 $ 103,634 $ 63,801 $ 206,404
Interest income............. 428,715 152,737 15,321 21,730 20,756 12,847 52,552
Securities lending income... 20,408 18,613 3,523 1,513 720 10,412 9,790
------------ ------------ ----------- -------------- ----------- ---------- ------------
Total investment income... 1,052,227 524,099 203,449 131,597 125,110 87,060 268,746
------------ ------------ ----------- -------------- ----------- ---------- ------------
Expenses:
Amortization of organization
costs (Note 1)............. 720 3,105 -- -- -- 720 720
Custodian fees.............. 17,919 14,575 37,616 4,525 11,946 7,500 21,366
Fund accounting fees (Note
2)......................... 7,298 9,921 1,717 1,136 1,943 5,974 2,002
Interest expense (Note 1)... 11,599 -- 14,054 152 4,308 17,249 540
Investment management and
administration fees (Note
2)......................... 269,678 366,482 61,242 42,009 71,926 165,662 74,106
Printing and postage
expenses................... 8,145 9,955 7,059 6,516 6,876 5,507 9,079
Professional fees........... 23,634 22,374 14,118 13,756 13,937 17,842 16,471
Registration and filing
fees....................... -- 362 -- -- -- 300 362
Trustees' fees and expenses
(Note 2)................... 724 905 724 724 724 936 905
Other expenses (Note 1)..... 907 1,090 907 724 905 481 543
------------ ------------ ----------- -------------- ----------- ---------- ------------
Total expenses before
reimbursements and
reductions............... 340,624 428,769 137,437 69,542 112,565 222,171 126,094
------------ ------------ ----------- -------------- ----------- ---------- ------------
Expenses reimbursed by
A I M Advisors, Inc.
(Note 2)............... -- -- (43,864) (16,879) (18,352) -- (32,922)
Expense reductions (Note
5)..................... (1,237) (1,971) (828) (352) (4,656) (2,656) (4,722)
------------ ------------ ----------- -------------- ----------- ---------- ------------
Total net expenses........ 339,387 426,798 92,745 52,311 89,557 219,515 88,450
------------ ------------ ----------- -------------- ----------- ---------- ------------
Net investment income
(loss)....................... 712,840 97,301 110,704 79,286 35,553 (132,455) 180,296
------------ ------------ ----------- -------------- ----------- ---------- ------------
Net realized and unrealized
gain (loss) on investments and
foreign currencies: (Note 1)
Net realized gain (loss) on
investments................ 1,993,147 6,289,791 (1,788,527) 612,865 (2,534,065) 1,892,614 (2,100,092)
Net realized gain (loss) on
foreign currency
transactions............... (80,372) 146,713 (60,576) (11,171) 9,034 -- 135,388
------------ ------------ ----------- -------------- ----------- ---------- ------------
Net realized gain (loss)
during the period........ 1,912,775 6,436,504 (1,849,103) 601,694 (2,525,031) 1,892,614 (1,964,704)
------------ ------------ ----------- -------------- ----------- ---------- ------------
Net change in unrealized
appreciation (depreciation)
on translation of assets
and liabilities in foreign
currencies................. 14,013 (145,200) 2,957 16,394 (566) -- (27,831)
Net change in unrealized
appreciation (depreciation)
of investments............. 5,105,148 7,826,768 (489,929) 131,756 (426,406) 3,646,069 (129,907)
------------ ------------ ----------- -------------- ----------- ---------- ------------
Net unrealized
appreciation
(depreciation) during the
period................... 5,119,161 7,681,568 (486,972) 148,150 (426,972) 3,646,069 (157,738)
------------ ------------ ----------- -------------- ----------- ---------- ------------
Net realized and unrealized
gain (loss) on investments
and foreign currencies..... 7,031,936 14,118,072 (2,336,075) 749,844 (2,952,003) 5,538,683 (2,122,442)
------------ ------------ ----------- -------------- ----------- ---------- ------------
Net increase (decrease) in net
assets resulting from
operations................... $ 7,744,776 $14,215,373 $(2,225,371) $ 829,130 $(2,916,450) $5,406,228 $ (1,942,146)
------------ ------------ ----------- -------------- ----------- ---------- ------------
------------ ------------ ----------- -------------- ----------- ---------- ------------
*Net of foreign withholding
tax of:...................... $ 73,591 $ 38,046 $ 9,948 $ 9,809 $ 12,051 $ -- $ 8,592
------------ ------------ ----------- -------------- ----------- ---------- ------------
------------ ------------ ----------- -------------- ----------- ---------- ------------
<CAPTION>
VARIABLE MONEY VARIABLE
EUROPE MARKET INTERNATIONAL
FUND FUND FUND
---------- ---------- -------------
<S> <C> <C> <C>
Investment income: * (Note 1)
Dividend income............. $ 440,855 -- $ 79,817
Interest income............. 32,865 $ 779,222 33,575
Securities lending income... 22,183 -- 4,009
---------- ---------- -------------
Total investment income... 495,903 779,222 117,401
---------- ---------- -------------
Expenses:
Amortization of organization
costs (Note 1)............. 720 720 --
Custodian fees.............. 18,130 5,249 10,480
Fund accounting fees (Note
2)......................... 4,890 3,859 999
Interest expense (Note 1)... 64,781 -- 2,240
Investment management and
administration fees (Note
2)......................... 190,268 70,158 36,877
Printing and postage
expenses................... 3,326 7,421 7,426
Professional fees........... 18,513 20,618 15,449
Registration and filing
fees....................... 362 -- 362
Trustees' fees and expenses
(Note 2)................... 905 724 631
Other expenses (Note 1)..... 544 906 453
---------- ---------- -------------
Total expenses before
reimbursements and
reductions............... 302,439 109,655 74,917
---------- ---------- -------------
Expenses reimbursed by
A I M Advisors, Inc.
(Note 2)............... -- (4,417) (26,578)
Expense reductions (Note
5)..................... (998) -- (232)
---------- ---------- -------------
Total net expenses........ 301,441 105,238 48,107
---------- ---------- -------------
Net investment income
(loss)....................... 194,462 673,984 69,294
---------- ---------- -------------
Net realized and unrealized
gain (loss) on investments and
foreign currencies: (Note 1)
Net realized gain (loss) on
investments................ 2,175,755 -- 242,046
Net realized gain (loss) on
foreign currency
transactions............... 58,126 -- 52,729
---------- ---------- -------------
Net realized gain (loss)
during the period........ 2,233,881 -- 294,775
---------- ---------- -------------
Net change in unrealized
appreciation (depreciation)
on translation of assets
and liabilities in foreign
currencies................. 526 -- (11,876)
Net change in unrealized
appreciation (depreciation)
of investments............. 7,324,624 -- 379,713
---------- ---------- -------------
Net unrealized
appreciation
(depreciation) during the
period................... 7,325,150 -- 367,837
---------- ---------- -------------
Net realized and unrealized
gain (loss) on investments
and foreign currencies..... 9,559,031 -- 662,612
---------- ---------- -------------
Net increase (decrease) in net
assets resulting from
operations................... $9,753,493 $ 673,984 $731,906
---------- ---------- -------------
---------- ---------- -------------
*Net of foreign withholding
tax of:...................... $ 63,431 $ -- $ 9,440
---------- ---------- -------------
---------- ---------- -------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F64
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
For the six months ended June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
--------------------------------------------------------
VARIABLE VARIABLE
VARIABLE GLOBAL U.S. VARIABLE
STRATEGIC GOVERNMENT GOVERNMENT LATIN
INCOME INCOME INCOME AMERICA
FUND FUND FUND FUND
------------- ------------ ------------ -------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income (loss).......... $ 1,019,266 $ 264,165 $ 170,672 $ 225,022
Net realized gain (loss) on
investments and foreign currency
transactions......................... 557,871 645,397 75,297 (471,815)
Net change in unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... (215,874) (803,018 ) -- (1,421)
Net change in unrealized appreciation
(depreciation) of investments........ (1,035,630) 193,751 (210 ) (4,716,591)
------------- ------------ ------------ -------------
Net increase (decrease) in net
assets resulting from operations... 325,633 300,295 245,759 (4,964,805)
------------- ------------ ------------ -------------
Distributions to shareholders: (Note 1)
From net investment income............ (931,396) (238,225 ) (168,832 ) (304,832)
From net realized gain on
investments.......................... -- -- -- (147,131)
------------- ------------ ------------ -------------
Total distributions................. (931,396) (238,225 ) (168,832 ) (451,963)
------------- ------------ ------------ -------------
Capital share transactions: (Note 4)
Increase from capital shares sold and
reinvested........................... 15,291,352 2,403,797 3,165,409 9,251,105
Decrease from capital shares
repurchased.......................... (18,437,601) (2,349,067 ) (4,125,945 ) (16,316,036)
------------- ------------ ------------ -------------
Net increase (decrease) from capital
share transactions................. (3,146,249) 54,730 (960,536 ) (7,064,931)
------------- ------------ ------------ -------------
Total increase (decrease) in net
assets................................. (3,752,012) 116,800 (883,609 ) (12,481,699)
Net assets:
Beginning of period................... 28,496,692 8,251,027 7,372,636 28,786,217
------------- ------------ ------------ -------------
End of period *...................... $ 24,744,680 $ 8,367,827 $ 6,489,027 $ 16,304,518
------------- ------------ ------------ -------------
------------- ------------ ------------ -------------
*Includes undistributed/accumulated
net investment income (loss) of:..... $ 485,547 $ 124,936 $ 72,461 $ 225,002
------------- ------------ ------------ -------------
------------- ------------ ------------ -------------
</TABLE>
<TABLE>
<CAPTION>
For the year ended December 31, 1997
GT GLOBAL
--------------------------------------------------------
VARIABLE VARIABLE
VARIABLE GLOBAL U.S. VARIABLE
STRATEGIC GOVERNMENT GOVERNMENT LATIN
INCOME INCOME INCOME AMERICA
FUND FUND FUND FUND
------------- ------------ ------------ -------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income (loss).......... $ 2,156,400 $ 591,394 $ 312,388 $ 404,383
Net realized gain (loss) on
investments and foreign currency
transactions......................... 1,618,244 (738,174) (1,476 ) 3,569,822
Net change in unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... 271,762 803,351 (2,603 ) 2,156
Net change in unrealized appreciation
(depreciation) of investments........ (1,968,623) (292,630) 153,207 (244,181)
------------- ------------ ------------ -------------
Net increase (decrease) in net
assets resulting from operations... 2,077,783 363,941 461,516 3,732,180
------------- ------------ ------------ -------------
Distributions to shareholders: (Note 1)
From net investment income............ (2,041,389) (616,309) (262,504 ) --
From net realized gain on
investments.......................... -- -- (42,460 ) --
------------- ------------ ------------ -------------
Total distributions................. (2,041,389) (616,309) (304,964 ) --
------------- ------------ ------------ -------------
Capital share transactions: (Note 4)
Increase from capital shares sold and
reinvested........................... 37,352,357 4,845,991 6,057,200 50,446,691
Decrease from capital shares
repurchased.......................... (40,609,980) (6,739,965) (4,324,042 ) (48,320,307)
------------- ------------ ------------ -------------
Net increase (decrease) from capital
share transactions................. (3,257,623) (1,893,974) 1,733,158 2,126,384
------------- ------------ ------------ -------------
Total increase (decrease) in net
assets................................. (3,221,229) (2,146,342) 1,889,710 5,858,564
Net assets:
Beginning of year..................... 31,717,921 10,397,369 5,482,926 22,927,653
------------- ------------ ------------ -------------
End of year * *...................... $ 28,496,692 $ 8,251,027 $ 7,372,636 $ 28,786,217
------------- ------------ ------------ -------------
------------- ------------ ------------ -------------
* *Includes undistributed/accumulated
net investment income (loss) of:..... $ 397,677 $ 98,996 $ 70,621 $ 304,812
------------- ------------ ------------ -------------
------------- ------------ ------------ -------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F65
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (cont'd)
For the six months ended June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
----------------------------------------------------------------------------------------
VARIABLE VARIABLE VARIABLE VARIABLE
GROWTH & TELECOM- EMERGING VARIABLE NATURAL VARIABLE
INCOME MUNICATIONS MARKETS INFRASTRUCTURE RESOURCES AMERICA
FUND FUND FUND FUND FUND FUND
------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income (loss).......... $ 712,840 $ 97,301 $ 110,704 $ 79,286 $ 35,553 $ (132,455)
Net realized gain (loss) on
investments and foreign currency
transactions......................... 1,912,775 6,436,504 (1,849,103) 601,694 (2,525,031) 1,892,614
Net change in unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... 14,013 (145,200) 2,957 16,394 (566) --
Net change in unrealized appreciation
(depreciation) of investments........ 5,105,148 7,826,768 (489,929) 131,756 (426,406) 3,646,069
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net
assets resulting from operations... 7,744,776 14,215,373 (2,225,371) 829,130 (2,916,450) 5,406,228
------------- ------------- ------------- ------------- ------------- -------------
Distributions to shareholders: (Note 1)
From net investment income............ (643,068) -- (4,623) (76,384 ) -- --
From net realized gain on
investments.......................... (689,824) (5,760,404) (832,060) -- (1,999,187) (6,036,408)
------------- ------------- ------------- ------------- ------------- -------------
Total distributions................. (1,332,892) (5,760,404) (836,683) (76,384 ) (1,999,187) (6,036,408)
------------- ------------- ------------- ------------- ------------- -------------
Capital share transactions: (Note 4)
Increase from capital shares sold and
reinvested........................... 46,201,200 28,941,237 22,774,036 1,024,596 17,093,092 42,804,541
Decrease from capital shares
repurchased.......................... (45,299,031) (29,717,773) (26,418,518) (2,331,627 ) (18,614,037) (40,487,917)
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) from capital
share transactions................. 902,169 (776,536) (3,644,482) (1,307,031 ) (1,520,945) 2,316,624
------------- ------------- ------------- ------------- ------------- -------------
Total increase (decrease) in net
assets................................. 7,314,053 7,678,433 (6,706,536) (554,285 ) (6,436,582) 1,686,444
Net assets:
Beginning of period................... 50,356,264 68,186,143 16,508,757 8,745,185 16,709,007 43,976,824
------------- ------------- ------------- ------------- ------------- -------------
End of period......................... $ 57,670,317 $ 75,864,576 $ 9,802,221 $ 8,190,900 $ 10,272,425 $ 45,663,268
------------- ------------- ------------- ------------- ------------- -------------
------------- ------------- ------------- ------------- ------------- -------------
*Includes undistributed/accumulated
net investment income (loss) of:..... $ 713,486 $ 97,301 $ 274,838 $ 80,405 $ 35,553 $ (132,455)
------------- ------------- ------------- ------------- ------------- -------------
------------- ------------- ------------- ------------- ------------- -------------
<CAPTION>
VARIABLE
NEW VARIABLE MONEY VARIABLE
PACIFIC EUROPE MARKET INTERNATIONAL
FUND FUND FUND FUND
------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income (loss).......... $ 180,296 $ 194,462 $ 673,984 $ 69,294
Net realized gain (loss) on
investments and foreign currency
transactions......................... (1,964,704) 2,233,881 -- 294,775
Net change in unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... (27,831) 526 -- (11,876)
Net change in unrealized appreciation
(depreciation) of investments........ (129,907) 7,324,624 -- 379,713
------------- -------------- -------------- -------------
Net increase (decrease) in net
assets resulting from operations... (1,942,146) 9,753,493 673,984 731,906
------------- -------------- -------------- -------------
Distributions to shareholders: (Note 1)
From net investment income............ (351,881) (60,959) (673,984) (56,951)
From net realized gain on
investments.......................... -- (3,918,823) -- (471,250)
------------- -------------- -------------- -------------
Total distributions................. (351,881) (3,979,782) (673,984) (528,201)
------------- -------------- -------------- -------------
Capital share transactions: (Note 4)
Increase from capital shares sold and
reinvested........................... 85,657,785 155,678,912 342,120,768 37,138,358
Decrease from capital shares
repurchased.......................... (88,162,829) (147,539,729) (337,623,895) (35,783,290)
------------- -------------- -------------- -------------
Net increase (decrease) from capital
share transactions................. (2,505,044) 8,139,183 4,496,873 1,355,068
------------- -------------- -------------- -------------
Total increase (decrease) in net
assets................................. (4,799,071) 13,912,894 4,496,873 1,558,773
Net assets:
Beginning of period................... 16,490,084 27,409,750 26,964,207 5,929,179
------------- -------------- -------------- -------------
End of period......................... $ 11,691,013 $ 41,322,644 $ 31,461,080 $ 7,487,952
------------- -------------- -------------- -------------
------------- -------------- -------------- -------------
*Includes undistributed/accumulated
net investment income (loss) of:..... $ 180,327 $ 194,452 $ -- $ 69,100
------------- -------------- -------------- -------------
------------- -------------- -------------- -------------
</TABLE>
<TABLE>
<CAPTION>
For the year ended December 31, 1997
GT GLOBAL
------------------------------------------------------------------------------------------
VARIABLE VARIABLE VARIABLE VARIABLE
GROWTH & TELECOM- EMERGING VARIABLE NATURAL VARIABLE
INCOME MUNICATIONS MARKETS INFRASTRUCTURE RESOURCES AMERICA
FUND FUND FUND FUND FUND FUND
------------- ------------- ------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Increase (decrease) in net
assets
Operations:
Net investment income
(loss)..................... $ 1,205,645 $ (68,334) $ 221,606 $ 83,258 $ (29,831) $ (142,918)
Net realized gain (loss) on
investments and foreign
currency transactions...... 1,630,452 5,806,561 492,304 (206,416) 2,034,294 6,277,204
Net change in unrealized
appreciation (depreciation)
on translation of assets
and liabilities in foreign
currencies................. (54,835) 167,417 (9,023) (1,800) 2,250 --
Net change in unrealized
appreciation (depreciation)
of investments............. 3,876,889 2,996,284 (2,699,474) 442,473 (1,935,169) (372,530)
------------- ------------- ------------- -------------- ------------- -------------
Net increase (decrease) in
net assets resulting from
operations............... 6,658,151 8,901,928 (1,994,587) 317,515 71,544 5,761,756
------------- ------------- ------------- -------------- ------------- -------------
Distributions to shareholders:
(Note 1)
From net investment
income..................... (1,300,804) -- (84,900) (47,833) -- (196,399)
From net realized gain on
investments................ (90,528) (7,777,355) (1,283,734) (431,226) (762,160) (1,554,377)
------------- ------------- ------------- -------------- ------------- -------------
Total distributions....... (1,391,332) (7,777,355) (1,368,634) (479,059) (762,160) (1,750,776)
------------- ------------- ------------- -------------- ------------- -------------
Capital share transactions:
(Note 4)
Increase from capital shares
sold and reinvested........ 80,082,075 53,743,901 65,386,565 6,628,609 42,957,139 51,554,136
Decrease from capital shares
repurchased................ (71,425,393) (49,940,160) (63,118,511) (3,775,850) (41,865,469) (53,234,901)
------------- ------------- ------------- -------------- ------------- -------------
Net increase (decrease)
from capital share
transactions............. 8,656,682 3,803,741 2,268,054 2,852,759 1,091,670 (1,680,765)
------------- ------------- ------------- -------------- ------------- -------------
Total increase (decrease) in
net assets................... 13,923,501 4,928,314 (1,095,167) 2,691,215 401,054 2,330,215
Net assets:
Beginning of year........... 36,432,763 63,257,829 17,603,924 6,053,970 16,307,953 41,646,609
------------- ------------- ------------- -------------- ------------- -------------
End of year * *............ $ 50,356,264 $ 68,186,143 $ 16,508,757 $ 8,745,185 $ 16,709,007 $ 43,976,824
------------- ------------- ------------- -------------- ------------- -------------
------------- ------------- ------------- -------------- ------------- -------------
* *Includes
undistributed/accumulated
net investment income
(loss) of:................. $ 643,714 $ -- $ 168,757 $ 77,503 $ -- $ --
------------- ------------- ------------- -------------- ------------- -------------
------------- ------------- ------------- -------------- ------------- -------------
<CAPTION>
VARIABLE
NEW VARIABLE MONEY VARIABLE
PACIFIC EUROPE MARKET INTERNATIONAL
FUND FUND FUND FUND
-------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
Increase (decrease) in net
assets
Operations:
Net investment income
(loss)..................... $ 415,628 $ 62,782 $ 1,033,856 $ 69,499
Net realized gain (loss) on
investments and foreign
currency transactions...... (100,720) 4,084,568 -- 501,515
Net change in unrealized
appreciation (depreciation)
on translation of assets
and liabilities in foreign
currencies................. 105,422 (4,948) -- 19,339
Net change in unrealized
appreciation (depreciation)
of investments............. (10,613,599) 417,896 -- (52,826)
-------------- -------------- -------------- -------------
Net increase (decrease) in
net assets resulting from
operations............... (10,193,269) 4,560,298 1,033,856 537,527
-------------- -------------- -------------- -------------
Distributions to shareholders:
(Note 1)
From net investment
income..................... (178,145) (69,048) (1,033,856) (7,912)
From net realized gain on
investments................ (128,263) (2,404,127) -- --
-------------- -------------- -------------- -------------
Total distributions....... (306,408) (2,473,175) (1,033,856) (7,912)
-------------- -------------- -------------- -------------
Capital share transactions:
(Note 4)
Increase from capital shares
sold and reinvested........ 181,437,283 147,172,457 524,518,140 35,266,039
Decrease from capital shares
repurchased................ (187,117,722) (146,386,879) (517,347,993) (34,648,323)
-------------- -------------- -------------- -------------
Net increase (decrease)
from capital share
transactions............. (5,680,439) 785,578 7,170,147 617,716
-------------- -------------- -------------- -------------
Total increase (decrease) in
net assets................... (16,180,116) 2,872,701 7,170,147 1,147,331
Net assets:
Beginning of year........... 32,670,200 24,537,049 19,794,060 4,781,848
-------------- -------------- -------------- -------------
End of year * *............ $ 16,490,084 $ 27,409,750 $ 26,964,207 $ 5,929,179
-------------- -------------- -------------- -------------
-------------- -------------- -------------- -------------
* *Includes
undistributed/accumulated
net investment income
(loss) of:................. $ 351,912 $ 60,949 $ -- $ 56,757
-------------- -------------- -------------- -------------
-------------- -------------- -------------- -------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F66
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
GT GLOBAL
-------------------------------------------------------------------------------
VARIABLE STRATEGIC INCOME FUND
-------------------------------------------------------------------------------
FEBRUARY 10,
1993
(COMMENCEMENT
SIX MONTHS OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
-------------- ---------- ---------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 13.39 $ 13.38 $ 11.86 $ 10.82 $ 14.57 $ 12.00
-------------- ---------- ---------- ---------- ---------- ---------------
Net investment income (loss).......... 0.52(a) 1.00(b) 0.95(c) 1.07(d) 1.71(e) 0.61(f)
Net realized and unrealized gain
(loss) on investments................ (0.40) (0.07) 1.50 0.93 (4.17) 2.57
-------------- ---------- ---------- ---------- ---------- ---------------
Net increase (decrease) resulting
from operations.................... 0.12 0.93 2.45 2.00 (2.46) 3.18
-------------- ---------- ---------- ---------- ---------- ---------------
Distributions to shareholders:
From net investment income............ (0.46) (0.92) (0.85) (0.96) (0.79) (0.61)
From net realized gain on
investments.......................... -- -- (0.08) -- (0.45) --
In excess of net realized gain on
investments.......................... -- -- -- -- -- --
Return of capital..................... -- -- -- -- (0.05) --
-------------- ---------- ---------- ---------- ---------- ---------------
Total distributions................. (0.46) (0.92) (0.93) (0.96) (1.29) (0.61)
-------------- ---------- ---------- ---------- ---------- ---------------
Net asset value, end of period.......... $ 13.05 $ 13.39 $ 13.38 $ 11.86 $ 10.82 $ 14.57
-------------- ---------- ---------- ---------- ---------- ---------------
-------------- ---------- ---------- ---------- ---------- ---------------
Total investment return (h) +.......... 0.84 % 7.14% 21.58% 19.50% (17.09)% 27.5%
-------------- ---------- ---------- ---------- ---------- ---------------
-------------- ---------- ---------- ---------- ---------- ---------------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 24,745 $ 28,497 $ 31,718 $ 25,345 $ 23,367 $ 18,089
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 7.47 % 7.20% 7.74% 9.59% 7.58% 6.6%
Without reimbursement and/or expense
reductions ++........................ 7.26 % 7.03% 7.59% 9.35% 7.43% 6.3%
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 5.2%
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.00 % 0.90% 0.99% 1.00% 1.00% 0.5%
Without reimbursement and/or expense
reductions ++........................ 1.21 % 1.07% 1.14% 1.24% 1.15% 0.9%
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 1.9%
Ratio of interest expense to average net
assets................................. 0.12 % --% --% --% --% --%
Portfolio turnover ++................... 260 % 185% 210% 193% 313% 245%
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
--------------------------------------------------------------------------------
VARIABLE LATIN AMERICA FUND
--------------------------------------------------------------------------------
FEBRUARY 10,
1993
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED)+++ 1997 1996 1995 1994 1993
-------------- ---------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 16.95 $ 14.80 $ 12.42 $ 19.17 $ 17.68 $ 12.00
-------------- ---------- ---------- ---------- ---------- --------
Net investment income (loss).......... 0.16(a) 0.24(b) 0.27(c) 0.51(d) 0.11(e) 0.04(f)
Net realized and unrealized gain
(loss) on investments................ (3.82) 1.91 2.49 (5.10) 1.49 5.64
-------------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... (3.66) 2.15 2.76 (4.59) 1.60 5.68
-------------- ---------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ (0.25) -- (0.37) (0.16) (0.04) --
From net realized gain on
investments.......................... (0.12) -- -- (2.00) (0.07) --
In excess of net investment income.... -- -- (0.01) -- -- --
Return of capital..................... -- -- -- -- -- --
-------------- ---------- ---------- ---------- ---------- --------
Total distributions................. (0.37) -- (0.38) (2.16) (0.11) --
-------------- ---------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 12.92 $ 16.95 $ 14.80 $ 12.42 $ 19.17 $ 17.68
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Total investment return (h) +.......... (21.63)% 14.53% 22.48% (24.14)% 9.14% 47.3 %
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 16,305 $ 28,786 $ 22,928 $ 19,771 $ 26,631 $ 8,240
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 2.07 % 1.36% 1.94% 4.43% 0.82% 1.0 %
Without reimbursement and/or expense
reductions ++........................ 1.84 % 1.21% 1.69% 3.92% 0.49% 0.4 %
Without expenses assumed by the
Manager (g) ++...................... -- % --% --% --% --% (2.5)%
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.25 % 1.25% 1.17% 1.18% 1.25% 0.7 %
Without reimbursement and/or expense
reductions ++........................ 1.48 % 1.40% 1.42% 1.69% 1.58% 1.3 %
Without expenses assumed by the
Manager (g) ++...................... -- -- --% --% --% 4.2 %
Ratio of interest expense to average net
assets................................. 0.17 % --% --% --% --% -- %
Portfolio turnover ++................... 25 % 141% 102% 140% 185% 78 %
</TABLE>
- ------------------------
(a) Includes reimbursement of Fund operating expenses of $0.01 for the
Variable Strategic Income Fund, $0.03 for the Variable Global
Government Income Fund, $0.03 for the Variable U.S. Government Income
Fund, and $0.02 for the Variable Latin America Fund (Note 2).
(b) Includes reimbursement of Fund operating expenses of $0.01 for the
Variable Strategic Income Fund, $0.06 for the Variable Global
Government Income Fund, $0.06 for Variable U.S. Government Income
Fund, $0.02 for the Variable Latin America Fund, and $0.00 for the
Variable Growth & Income Fund (Note 2).
(c) Includes reimbursement of Fund operating expenses of $0.02 for the
Variable Strategic Income Fund, $0.06 for the Variable Global
Government Income Fund, $0.08 for the Variable U.S. Government Income
Fund, $0.02 for the Variable Latin America Fund, and $0.01 for the
Variable Growth & Income Fund (Note 2).
(d) Includes reimbursement of Fund operating expenses of $0.03 for the
Variable Strategic Income Fund, $0.07 for the Variable Global
Government Income Fund, $0.14 for the Variable U.S. Government Income
Fund, $0.06 for the Variable Latin America Fund, $0.03 for the
Variable Growth & Income Fund, and $0.00 for the Variable
Telecommunications Fund (Note 2).
(e) Includes reimbursement of Fund operating expenses of $0.04 for the
Variable Strategic Income Fund, $0.08 for the Variable Global
Government Income Fund, $0.48 for the Variable U.S. Government Income
Fund, $0.04 for the Variable Latin America Fund, $0.03 for the
Variable Growth & Income Fund, and $0.01 for the Variable
Telecommunications Fund (Note 2).
The accompanying notes are an integral part of the financial statements.
F67
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
GT GLOBAL
---------------------------------------------------------------------------------
VARIABLE GLOBAL GOVERNMENT INCOME FUND
---------------------------------------------------------------------------------
FEBRUARY 10,
1993
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
--------------- ---------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 11.17 $ 11.43 $ 11.51 $ 10.63 $ 12.53 $ 12.00
--------------- ---------- ---------- ---------- ---------- --------
Net investment income (loss).......... 0.36(a) 0.82(b) 0.72(c) 0.79(d) 0.77(e) 0.57(f)
Net realized and unrealized gain
(loss) on investments................ 0.06 (0.34) (0.06) 0.84 (1.85) 0.52
--------------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... 0.42 0.48 0.66 1.63 (1.08) 1.09
--------------- ---------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ (0.33) (0.74) (0.74) (0.75) (0.73) (0.56)
From net realized gain on
investments.......................... -- -- -- -- -- --
In excess of net realized gain on
investments.......................... -- -- -- -- -- --
Return of capital..................... -- -- -- -- (0.09) --
--------------- ---------- ---------- ---------- ---------- --------
Total distributions................. (0.33) (0.74) (0.74) (0.75) (0.82) (0.56)
--------------- ---------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 11.26 $ 11.17 $ 11.43 $ 11.51 $ 10.63 $ 12.53
--------------- ---------- ---------- ---------- ---------- --------
--------------- ---------- ---------- ---------- ---------- --------
Total investment return (h) +.......... 3.76% 4.37% 6.17% 15.85% (8.70)% 9.5 %
--------------- ---------- ---------- ---------- ---------- --------
--------------- ---------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 8,368 $ 8,251 $ 10,397 $ 11,944 $ 9,654 $ 6,136
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 6.43% 6.33% 6.32% 7.03% 6.89% 6.1 %
Without reimbursement and/or expense
reductions ++........................ 5.86% 5.74% 5.80% 6.37% 6.21% 5.5 %
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 2.4 %
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.00% 0.95% 0.95% 1.00% 1.00% 0.5 %
Without reimbursement and/or expense
reductions ++........................ 1.57% 1.54% 1.47% 1.66% 1.68% 1.1 %
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 4.2 %
Ratio of interest expense to average net
assets................................. 0.06% --% --% --% --% -- %
Portfolio turnover ++................... 186% 235% 235% 394% 350% 298 %
<CAPTION>
GT GLOBAL
---------------------------------------------------------------------------------
VARIABLE U.S. GOVERNMENT INCOME FUND
---------------------------------------------------------------------------------
FEBRUARY 10,
1993
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
--------------- ---------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 11.70 $ 11.41 $ 11.74 $ 10.79 $ 12.23 $ 12.00
--------------- ---------- ---------- ---------- ---------- --------
Net investment income (loss).......... 0.32(a) 0.63(b) 0.60(c) 0.62(d) 0.63(e) 0.53(f)
Net realized and unrealized gain
(loss) on investments................ 0.12 0.29 (0.35) 0.93 (1.39) 0.23
--------------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... 0.44 0.92 0.25 1.55 (0.76) 0.76
--------------- ---------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ (0.31) (0.54) (0.58) (0.60) (0.62) (0.53)
From net realized gain on
investments.......................... -- (0.09) -- -- (0.06) --
In excess of net realized gain on
investments.......................... -- -- -- -- -- --
Return of capital..................... -- -- -- -- -- --
--------------- ---------- ---------- ---------- ---------- --------
Total distributions................. (0.31) (0.63) (0.58) (0.60) (0.68) (0.53)
--------------- ---------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 11.83 $ 11.70 $ 11.41 $ 11.74 $ 10.79 $ 12.23
--------------- ---------- ---------- ---------- ---------- --------
--------------- ---------- ---------- ---------- ---------- --------
Total investment return (h) +.......... 3.79% 8.30% 2.23% 14.73% (6.27)% 6.4 %
--------------- ---------- ---------- ---------- ---------- --------
--------------- ---------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 6,489 $ 7,373 $ 5,483 $ 5,992 $ 2,415 $ 974
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 5.30% 5.54% 5.24% 5.43% 5.53% 5.3 %
Without reimbursement and/or expense
reductions ++........................ 4.78% 4.92% 4.49% 3.87% 1.29% 3.4 %
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% (6.9)%
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.00% 1.00% 1.00% 1.00% 0.38% 0.0 %
Without reimbursement and/or expense
reductions ++........................ 1.52% 1.62% 1.75% 2.56% 4.63% 1.9 %
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 12.3 %
Ratio of interest expense to average net
assets................................. 0.04% --% --% --% --% -- %
Portfolio turnover ++................... 211% 143% 49% 186% 34% 81 %
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
-------------------------------------------------------------------------------
VARIABLE GROWTH & INCOME FUND
-------------------------------------------------------------------------------
FEBRUARY 10,
1993
(COMMENCEMENT
SIX MONTHS OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
-------------- ---------- ---------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 18.60 $ 16.51 $ 14.57 $ 12.99 $ 13.77 $ 12.00
-------------- ---------- ---------- ---------- ---------- ---------------
Net investment income (loss).......... 0.26 0.41(b) 0.53(c) 0.52(d) 0.46(e) 0.31(f)
Net realized and unrealized gain
(loss) on investments................ 2.59 2.23 1.81 1.46 (0.85) 1.79
-------------- ---------- ---------- ---------- ---------- ---------------
Net increase (decrease) resulting
from operations.................... 2.85 2.64 2.34 1.98 (0.39) 2.10
-------------- ---------- ---------- ---------- ---------- ---------------
Distributions to shareholders:
From net investment income............ (0.24) (0.51) (0.35) (0.40) (0.39) (0.28)
From net realized gain on
investments.......................... (0.25) (0.04) (0.05) -- -- (0.05)
In excess of net investment income.... -- -- -- -- -- --
Return of capital..................... -- -- -- -- -- --
-------------- ---------- ---------- ---------- ---------- ---------------
Total distributions................. (0.49) (0.55) (0.40) (0.40) (0.39) (0.33)
-------------- ---------- ---------- ---------- ---------- ---------------
Net asset value, end of period.......... $ 20.96 $ 18.60 $ 16.51 $ 14.57 $ 12.99 $ 13.77
-------------- ---------- ---------- ---------- ---------- ---------------
-------------- ---------- ---------- ---------- ---------- ---------------
Total investment return (h) +.......... 15.40 % 16.22% 16.33% 15.49% (2.85)% 17.8%
-------------- ---------- ---------- ---------- ---------- ---------------
-------------- ---------- ---------- ---------- ---------- ---------------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 57,670 $ 50,356 $ 36,433 $ 30,565 $ 25,580 $ 11,677
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 2.64 % 2.86% 3.58% 3.87% 3.69% 3.2%
Without reimbursement and/or expense
reductions ++........................ 2.64 % 2.72% 3.48% 3.66% 3.45% 2.7%
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 1.1%
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.22 % 1.13% 1.20% 1.23% 1.25% 0.6%
Without reimbursement and/or expense
reductions ++........................ 1.22 % 1.27% 1.30% 1.44% 1.49% 1.2%
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 2.8%
Ratio of interest expense to average net
assets................................. 0.04 % --% --% --% --% --%
Portfolio turnover ++................... 63 % 60% 57% 73% 53% 17%
<CAPTION>
GT GLOBAL
--------------------------------------------------------------------------------
VARIABLE TELECOMMUNICATIONS FUND
--------------------------------------------------------------------------------
OCTOBER 18, 1993
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
-------------- ---------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 18.40 $ 18.14 $ 16.87 $ 13.98 $ 13.07 $ 12.00
-------------- ---------- ---------- ---------- ---------- --------
Net investment income (loss).......... 0.03 (0.02) (0.05) 0.02(d) 0.01(e) 0.04(f)
Net realized and unrealized gain
(loss) on investments................ 3.88 2.59 3.31 3.26 0.92 1.03
-------------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... 3.91 2.57 3.26 3.28 0.93 1.07
-------------- ---------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ -- -- (0.02) (0.03) (0.02) --
From net realized gain on
investments.......................... (1.72) (2.31) (1.97) (0.36) -- --
In excess of net investment income.... -- -- -- -- -- --
Return of capital..................... -- -- -- -- -- --
-------------- ---------- ---------- ---------- ---------- --------
Total distributions................. (1.72) (2.31) (1.99) (0.39) (0.02) --
-------------- ---------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 20.59 $ 18.40 $ 18.14 $ 16.87 $ 13.98 $ 13.07
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Total investment return (h) +.......... 21.69 % 14.56% 19.34% 23.66% 7.15% 8.9 %
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 75,865 $ 68,186 $ 63,258 $ 50,778 $ 36,029 $ 7,903
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 0.26 % (0.10)% (0.26)% 0.16% 0.31% 2.5 %
Without reimbursement and/or expense
reductions ++........................ 0.26 % (0.15)% (0.31)% 0.10% 0.07% 2.3 %
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 1.6 %
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.16 % 1.11% 1.12% 1.20% 1.25% 0.9 %
Without reimbursement and/or expense
reductions ++........................ 1.16 % 1.16% 1.17% 1.26% 1.49% 1.1 %
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 1.8 %
Ratio of interest expense to average net
assets................................. -- % --% --% --% --% -- %
Portfolio turnover ++................... 64 % 91% 77% 70% 81% 20 %
</TABLE>
- ------------------------
(f) Includes reimbursement of Fund operating expenses of $0.03 for the
Variable Strategic Income Fund, $0.06 for the Variable Global
Government Income Fund, $0.19 for the Variable U.S. Government Income
Fund, $0.02 for the Variable Latin America Fund, $0.05 for the
Variable Growth & Income Fund, and $0.00 for the Variable
Telecommunications Fund (Note 2).
(g) During the period ended December 31, 1993, the Manager voluntarily
assumed certain expenses for the Funds (Note 2).
(h) Total return information does not reflect expenses that apply to the
Separate Accounts or the related insurance contracts, and inclusion of
these charges would reduce the total return figures for all periods
shown.
+ Not annualized for periods of less than one year.
++ Annualized for periods of less than one year.
+++ Calculated based upon average shares outstanding during the period.
The accompanying notes are an integral part of the financial statements.
F68
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
---------------------------------------------------------------------
VARIABLE EMERGING MARKETS FUND
---------------------------------------------------------------------
JULY 5, 1994
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994
--------------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 11.57 $ 14.26 $ 10.88 $ 11.89 $ 12.00
--------------- ---------- ---------- ---------- --------
Net investment income (loss).......... 0.13(a) 0.15(b) 0.11(c) 0.14(d) 0.07(e)
Net realized and unrealized gain
(loss) on investments................ (2.17) (1.89) 3.27 (1.04) (0.05)
--------------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... (2.04) (1.74) 3.38 (0.90) 0.02
--------------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ (0.01) (0.06) -- (0.09) (0.07)
From net realized gain on
investments.......................... (0.81) (0.89) -- -- --
In excess of net realized gain on
investments.......................... -- -- -- -- (0.06)
Return of capital..................... -- -- -- (0.02) --
--------------- ---------- ---------- ---------- --------
Total distributions................. (0.82) (0.95) -- (0.11) (0.13)
--------------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 8.71 $ 11.57 $ 14.26 $ 10.88 $ 11.89
--------------- ---------- ---------- ---------- --------
--------------- ---------- ---------- ---------- --------
Total investment return (h) +.......... (17.85)% (13.76)% 31.07% (7.54)% 0.12 %
--------------- ---------- ---------- ---------- --------
--------------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 9,802 $ 16,509 $ 17,604 $ 8,983 $ 7,267
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.74% 1.05% 0.89% 1.55% 4.10 %
Without reimbursement and/or expense
reductions ++........................ 1.03% 0.78% 0.39% 0.51% (0.20)%
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% -- %
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.23% 1.22% 1.18% 1.18% 0.00 %
Without reimbursement and/or expense
reductions ++........................ 1.94% 1.49% 1.68% 2.22% 4.30 %
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% -- %
Ratio of interest expense to average net
assets................................. 0.22% --% --% --% -- %
Portfolio turnover ++................... 103% 212% 216% 210% 117 %
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
--------------------------------------------------------------------------------
VARIABLE AMERICA FUND
--------------------------------------------------------------------------------
FEBRUARY 10,
1993
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
-------------- ---------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 21.68 $ 19.71 $ 19.46 $ 15.81 $ 13.75 $ 12.00
-------------- ---------- ---------- ---------- ---------- --------
Net investment income (loss).......... (0.06) (0.07) 0.12(c) 0.21(d) 0.48(e) 1.11(f)
Net realized and unrealized gain
(loss) on investments................ 2.60 2.88 3.18 3.80 2.08 0.64
-------------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... 2.54 2.81 3.30 4.01 2.56 1.75
-------------- ---------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ -- (0.09) (0.30) (0.07) (0.50) --
From net realized gain on
investments.......................... (3.20) (0.75) (2.75) (0.29) -- --
In excess of net realized gain on
investments.......................... -- -- -- -- -- --
Return of capital..................... -- -- -- -- -- --
-------------- ---------- ---------- ---------- ---------- --------
Total distributions................. (3.20) (0.84) (3.05) (0.36) (0.50) --
-------------- ---------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 21.02 $ 21.68 $ 19.71 $ 19.46 $ 15.81 $ 13.75
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Total investment return (h) +.......... 12.76 % 14.88% 18.55% 25.37% 18.88% 14.7 %
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 45,663 $ 43,977 $ 41,647 $ 37,643 $ 15,257 $ 1,700
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... (0.60)% (0.35)% 0.52% 1.66% 1.83% 14.1 %
Without reimbursement and/or expense
reductions ++........................ (0.61)% (0.42)% 0.46% 1.60% 0.76% 12.8 %
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 7.6 %
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 0.92 % 0.91% 0.95% 1.00% 0.98% 0.0 %
Without reimbursement and/or expense
reductions ++........................ 0.93 % 0.98% 1.01% 1.06% 2.05% 1.3 %
Without expenses assumed by the
Manager (g) ++...................... -- --% --% --% --% 6.5 %
Ratio of interest expense to average net
assets................................. 0.07 % --% --% --% --% -- %
Portfolio turnover ++................... 177 % 210% 248% 79% 139% 831 %
</TABLE>
- ------------------------
(a) Includes reimbursement of Fund operating expenses of $0.04 for the
Variable Emerging Markets Fund, $0.03 for the Variable Infrastructure
Fund, $0.02 for the Variable Natural Resources Fund, and $0.02 for the
Variable New Pacific Fund (Note 2).
(b) Includes reimbursement of Fund operating expenses of $0.03 for the
Variable Emerging Markets Fund, $0.04 for the Variable Infrastructure
Fund, $0.03 for the Variable Natural Resources Fund, $0.02 for the
Variable New Pacific Fund, and $0.02 for the Variable Europe Fund
(Note 2).
(c) Includes reimbursement of Fund operating expenses of $0.05 for the
Variable Emerging Markets Fund, $0.19 for the Variable Infrastructure
Fund, $0.11 for the Variable Natural Resources Fund, $0.00 for the
Variable America Fund, $0.04 for the Variable New Pacific Fund, and
$0.04 for the Variable Europe Fund (Note 2).
(d) Includes reimbursement of Fund operating expenses of $0.09 for the
Variable Emerging Markets Fund, $0.42 for the Variable Infrastructure
Fund, $0.47 for the Variable Natural Resources Fund, $0.01 for the
Variable America Fund, $0.04 for the Variable New Pacific Fund, and
$0.08 for the Variable Europe Fund (Note 2).
(e) Includes reimbursement of Fund operating expenses of $0.07 for the
Variable Emerging Markets Fund, $0.28 for the Variable America Fund,
$0.03 for the Variable New Pacific Fund, and $0.04 for the Variable
Europe Fund (Note 2).
The accompanying notes are an integral part of the financial statements.
F69
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
GT GLOBAL
GT GLOBAL --------------------------
---------------------------------------------------------
VARIABLE NATURAL RESOURCES
VARIABLE INFRASTRUCTURE FUND FUND
--------------------------------------------------------- --------------------------
JANUARY 31, 1995 YEAR ENDED
SIX MONTHS YEAR ENDED (COMMENCEMENT OF SIX MONTHS DECEMBER
ENDED DECEMBER 31, OPERATIONS) TO ENDED 31,
JUNE 30, 1998 ---------------------- DECEMBER 31, JUNE 30, 1998 ----------
(UNAUDITED) 1997 1996 1995 (UNAUDITED) 1997
--------------- ---------- ---------- ---------------- -------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 16.35 $ 16.47 $ 13.27 $ 12.00 $ 20.20 $ 20.98
--------------- ---------- ---------- -------- -------------- ----------
Net investment income (loss).......... 0.20(a) 0.12(b) 0.11(c) 0.07(d) 0.05(a) (0.03)(b)
Net realized and unrealized gain
(loss) on investments................ 1.51 0.74 3.19 1.20 (3.99) 0.18
--------------- ---------- ---------- -------- -------------- ----------
Net increase (decrease) resulting
from operations.................... 1.71 0.86 3.30 1.27 (3.94) 0.15
--------------- ---------- ---------- -------- -------------- ----------
Distributions to shareholders:
From net investment income............ (0.17) (0.10) (0.03) -- -- --
From net realized gain on
investments.......................... -- (0.88) (0.07) -- (3.15) (0.93)
In excess of net realized gain on
investments.......................... -- -- -- -- -- --
Return of capital..................... -- -- -- -- -- --
--------------- ---------- ---------- -------- -------------- ----------
Total distributions................. (0.17) (0.98) (0.10) -- (3.15) (0.93)
--------------- ---------- ---------- -------- -------------- ----------
Net asset value, end of period.......... $ 17.89 $ 16.35 $ 16.47 $ 13.27 $ 13.11 $ 20.20
--------------- ---------- ---------- -------- -------------- ----------
--------------- ---------- ---------- -------- -------------- ----------
Total investment return (h) +.......... 10.47% 5.00% 24.88% 10.58 % (19.42)% 1.29%
--------------- ---------- ---------- -------- -------------- ----------
--------------- ---------- ---------- -------- -------------- ----------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 8,191 $ 8,745 $ 6,054 $ 1,594 $ 10,272 $ 16,709
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.88% 0.99% 1.35% 1.24 % 0.49 % (0.16)%
Without reimbursement and/or expense
reductions ++........................ 1.47% 0.68% 0.03% (6.11)% 0.17 % (0.38)%
Without expenses assumed by the
Manager (g) ++...................... -- --% --% -- % -- --%
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.24% 1.18% 1.21% 1.22 % 1.18 % 1.20%
Without reimbursement and/or expense
reductions ++........................ 1.65% 1.49% 2.53% 8.57 % 1.50 % 1.42%
Without expenses assumed by the
Manager (g) ++...................... -- --% --% -- % -- --%
Ratio of interest expense to average net
assets................................. --% --% --% -- % 0.06 % --%
Portfolio turnover ++................... 116% 46% 76% 38 % 272 % 315%
<CAPTION>
JANUARY 31, 1995
(COMMENCEMENT OF
OPERATIONS) TO
DECEMBER 31,
1996 1995
---------- ----------------
<S> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 13.88 $ 12.00
---------- --------
Net investment income (loss).......... (0.06) c ) 0.73(d)
Net realized and unrealized gain
(loss) on investments................ 7.16 1.91
---------- --------
Net increase (decrease) resulting
from operations.................... 7.10 2.64
---------- --------
Distributions to shareholders:
From net investment income............ -- (0.71)
From net realized gain on
investments.......................... -- --
In excess of net realized gain on
investments.......................... -- (0.05)
Return of capital..................... -- --
---------- --------
Total distributions................. -- (0.76)
---------- --------
Net asset value, end of period.......... $ 20.98 $ 13.88
---------- --------
---------- --------
Total investment return (h) +.......... 51.15% 22.20 %
---------- --------
---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 16,308 $ 1,365
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... (0.60)% 10.87 %
Without reimbursement and/or expense
reductions ++........................ (1.30)% 2.94 %
Without expenses assumed by the
Manager (g) ++...................... --% -- %
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.19% 1.14 %
Without reimbursement and/or expense
reductions ++........................ 1.89% 9.07 %
Without expenses assumed by the
Manager (g) ++...................... --% -- %
Ratio of interest expense to average net
assets................................. --% -- %
Portfolio turnover ++................... 199% 875 %
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
--------------------------------------------------------------------------------
VARIABLE NEW PACIFIC FUND
--------------------------------------------------------------------------------
FEBRUARY 10,
1993
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
-------------- ---------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 10.50 $ 18.02 $ 13.92 $ 14.01 $ 16.07 $ 12.00
-------------- ---------- ---------- ---------- ---------- --------
Net investment income (loss).......... 0.15(a) 0.26(b) 0.13(c) 0.20(d) 0.08(e) 0.04(f)
Net realized and unrealized gain
(loss) on investments................ (2.19) (7.61) 4.16 (0.23) (2.08) 4.03
-------------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... (2.04) (7.35) 4.29 (0.03) (2.00) 4.07
-------------- ---------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ (0.25) (0.10) (0.19) (0.06) (0.06) --
From net realized gain on
investments.......................... -- (0.07) -- -- -- --
In excess of net realized gain on
investments.......................... -- -- -- -- -- --
Return of capital..................... -- -- -- -- -- --
-------------- ---------- ---------- ---------- ---------- --------
Total distributions................. (0.25) (0.17) (0.19) (0.06) (0.06) --
-------------- ---------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 8.21 $ 10.50 $ 18.02 $ 13.92 $ 14.01 $ 16.07
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Total investment return (h) +.......... (19.54)% (41.11)% 30.97% (0.21)% (12.47)% 33.9 %
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 11,691 $ 16,490 $ 32,670 $ 23,025 $ 19,391 $ 7,945
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 2.43 % 1.50% 0.88% 1.27% 0.83% 0.9 %
Without reimbursement and/or expense
reductions ++........................ 1.92 % 1.16% 0.60% 1.74% 0.48% 0.3 %
Without expenses assumed by the
Manager (g) ++...................... -- -- --% --% --% (2.0)%
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.18 % 1.09% 1.12% 1.14% 1.25% 0.6 %
Without reimbursement and/or expense
reductions ++........................ 1.69 % 1.43% 1.40% 1.61% 1.60% 1.3 %
Without expenses assumed by the
Manager (g) ++...................... -- -- --% --% --% 3.6 %
Ratio of interest expense to average net
assets................................. 0.01 % --% --% --% --% -- %
Portfolio turnover ++................... 90 % 93% 70% 67% 30% 15 %
<CAPTION>
GT GLOBAL
--------------------------------------------------------------------------------
VARIABLE EUROPE FUND
--------------------------------------------------------------------------------
FEBRUARY 10,
1993
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
-------------- ---------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 22.52 $ 21.34 $ 16.52 $ 15.22 $ 15.33 $ 12.00
-------------- ---------- ---------- ---------- ---------- --------
Net investment income (loss).......... 0.13 0.05(b) 0.05(c) 0.18(d) 0.16(e) 0.05(f)
Net realized and unrealized gain
(loss) on investments................ 6.08 3.10 4.93 1.28 (0.25) 3.28
-------------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... 6.21 3.15 4.98 1.46 (0.09) 3.33
-------------- ---------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ (0.05) (0.06) (0.16) (0.16) -- --
From net realized gain on
investments.......................... (2.97) (1.91) -- -- (0.02) --
In excess of net realized gain on
investments.......................... -- -- -- -- -- --
Return of capital..................... -- -- -- -- -- --
-------------- ---------- ---------- ---------- ---------- --------
Total distributions................. (3.02) (1.97) (0.16) (0.16) (0.02) --
-------------- ---------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 25.71 $ 22.52 $ 21.34 $ 16.52 $ 15.22 $ 15.33
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Total investment return (h) +.......... 27.86 % 15.15% 30.25% 9.66% (0.59)% 27.8 %
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 41,323 $ 27,410 $ 24,537 $ 15,641 $ 15,020 $ 5,410
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.02 % 0.22% 0.36% 1.12% 1.48% 1.1 %
Without reimbursement and/or expense
reductions ++........................ 1.01 % 0.01% 0.09% 0.60% 1.07% 0.4 %
Without expenses assumed by the
Manager (g) ++...................... -- -- --% --% --% (2.8)%
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.24 % 1.20% 1.20% 1.20% 1.25% 0.7 %
Without reimbursement and/or expense
reductions ++........................ 1.25 % 1.41% 1.47% 1.72% 1.66% 1.4 %
Without expenses assumed by the
Manager (g) ++...................... -- -- --% --% --% 4.6 %
Ratio of interest expense to average net
assets................................. 0.34 % --% --% --% --% -- %
Portfolio turnover ++................... 40 % 117% 56% 123% 61% 27 %
</TABLE>
- ------------------------
(f) Includes reimbursement of Fund operating expenses of $0.10 for the
Variable America Fund, $0.03 for the Variable New Pacific Fund, and
$0.03 for the Variable Europe Fund (Note 2).
(g) During the period ended December 31, 1993, the Manager voluntarily
assumed certain expenses for the Funds (Note 2).
(h) Total return information does not reflect expenses that apply to the
Separate Accounts or the related insurance contracts, and inclusion of
these charges would reduce the total return figures for all periods
shown.
+ Not annualized for periods of less than one year.
++ Annualized for periods of less than one year.
The accompanying notes are an integral part of the financial statements.
F70
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
--------------------------------------------------------------------------------
MONEY MARKET FUND
--------------------------------------------------------------------------------
FEBRUARY 10,
1993
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
-------------- ---------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------------- ---------- ---------- ---------- ---------- --------
Net investment income (loss).......... 0.02(a) 0.05(b) 0.05(c) 0.05(d) 0.03(e) 0.03(f)
Net realized and unrealized gain
(loss) on investments................ -- -- -- -- -- --
-------------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... 0.02 0.05 0.05 0.05 0.03 0.03
-------------- ---------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ (0.02) (0.05) (0.05) (0.05) (0.03) (0.03)
From net realized gain on
investments.......................... -- -- -- -- -- --
In excess of net realized gain on
investments.......................... -- -- -- -- -- --
Return of capital..................... -- -- -- -- -- --
-------------- ---------- ---------- ---------- ---------- --------
Total distributions................. (0.02) (0.05) (0.05) (0.05) (0.03) (0.03)
-------------- ---------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Total investment return (h) +.......... 2.39 % 4.96% 4.75% 5.26% 3.48% 2.6 %
-------------- ---------- ---------- ---------- ---------- --------
-------------- ---------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 31,461 $ 26,964 $ 19,794 $ 14,891 $ 19,474 $ 3,775
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 4.80 % 4.77% 4.67% 5.15% 3.70% 2.9 %
Without reimbursement and/or expense
reductions ++........................ 4.77 % 4.73% 4.57% 4.85% 3.64% 2.1 %
Without expenses assumed by the
Manager (g) ++...................... -- -- --% --% --% (2.6)%
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 0.75 % 0.75% 0.75% 0.75% 0.75% 0.2 %
Without reimbursement and/or expense
reductions ++........................ 0.78 % 0.79% 0.85% 1.05% 0.81% 1.0 %
Without expenses assumed by the
Manager (g) ++...................... -- -- --% --% --% 5.7 %
Ratio of interest expense to average net
assets................................. N/A N/A N/A N/A N/A N/A
Portfolio turnover ++................... N/A N/A N/A N/A N/A N/A
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
---------------------------------------------------------------------
VARIABLE INTERNATIONAL FUND
---------------------------------------------------------------------
JULY 5, 1994
SIX MONTHS (COMMENCEMENT OF
ENDED YEAR ENDED DECEMBER 31, OPERATIONS) TO
JUNE 30, 1998 ---------------------------------- DECEMBER 31,
(UNAUDITED) 1997 1996 1995 1994
--------------- ---------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 12.72 $ 11.91 $ 11.01 $ 11.25 $ 12.00
--------------- ---------- ---------- ---------- --------
Net investment income (loss).......... 0.09(a) 0.15(b) 0.05(c) 0.09(d) 0.06(e)
Net realized and unrealized gain
(loss) on investments................ 1.24 0.68 0.89 (0.22) (0.76)
--------------- ---------- ---------- ---------- --------
Net increase (decrease) resulting
from operations.................... 1.33 0.83 0.94 (0.13) (0.70)
--------------- ---------- ---------- ---------- --------
Distributions to shareholders:
From net investment income............ (0.09) (0.02) -- (0.09) (0.05)
From net realized gain on
investments.......................... (0.75) -- (0.04) (0.02) --
In excess of net realized gain on
investments.......................... -- -- -- -- --
Return of capital..................... -- -- -- -- --
--------------- ---------- ---------- ---------- --------
Total distributions................. (0.84) (0.02) (0.04) (0.11) (0.05)
--------------- ---------- ---------- ---------- --------
Net asset value, end of period.......... $ 13.21 $ 12.72 $ 11.91 $ 11.01 $ 11.25
--------------- ---------- ---------- ---------- --------
--------------- ---------- ---------- ---------- --------
Total investment return (h) +.......... 10.58% 6.93% 8.52% (1.14)% (5.81)%
--------------- ---------- ---------- ---------- --------
--------------- ---------- ---------- ---------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 7,488 $ 5,929 $ 4,782 $ 3,663 $ 2,229
Ratio of net investment income (loss) to
average net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.88% 1.22% 0.48% 0.93% 3.33 %
Without reimbursement and/or expense
reductions ++........................ 1.15% 0.05% (0.86)% (1.35)% (2.56)%
Without expenses assumed by the
Manager (g) ++...................... -- -- --% --% -- %
Ratio of operating expenses to average
net assets:
With reimbursement and/or expense
reductions (Notes 2 & 5) ++.......... 1.24% 1.14% 1.15% 1.25% 0.69 %
Without reimbursement and/or expense
reductions ++........................ 1.97% 2.31% 2.49% 3.53% 6.58 %
Without expenses assumed by the
Manager (g) ++...................... -- -- --% --% -- %
Ratio of interest expense to average net
assets................................. 0.06% --% --% --% -- %
Portfolio turnover ++................... 76% 112% 92% 107% 17 %
</TABLE>
- ------------------------
(a) Includes reimbursement of Fund operating expenses of $0.00 for the
Money Market Fund and $0.05 for the Variable International Fund (Note
2).
(b) Includes reimbursement of Fund operating expenses of $0.00 for the
Money Market Fund and $0.06 for the Variable International Fund (Note
2).
(c) Includes reimbursement of Fund operating expenses of $0.00 for the
Money Market Fund and $0.14 for the Variable International Fund (Note
2).
(d) Includes reimbursement of Fund operating expenses of $0.00 for the
Money Market Fund and $0.22 for the Variable International Fund (Note
2).
(e) Includes reimbursement of Fund operating expenses of $0.00 for the
Money Market Fund and $0.11 for the Variable International Fund (Note
2).
(f) Includes reimbursement of Fund operating expenses of $0.01 for the
Money Market Fund (Note 2).
(g) During the period ended December 31, 1993, the Manager voluntarily
assumed certain expenses for the Funds (Note 2).
(h) Total return information does not reflect expenses that apply to the
Separate Accounts or the related insurance contracts, and inclusion of
these charges would reduce the total return figures for all periods
shown.
+ Not annualized for periods of less than one year.
++ Annualized for periods of less than one year.
N/A Not applicable.
The accompanying notes are an integral part of the financial statements.
F71
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
NOTES TO FINANCIAL STATEMENTS
June 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES (SEE ALSO NOTE 2)
GT Global Variable Investment Series and GT Global Variable Investment Trust
("Trusts") were reorganized as Delaware business trusts on May 29, 1998.
Previously they were Massachusetts business trusts organized on May 26, 1992 and
September 17, 1992, respectively. The Trusts are registered under the Investment
Company Act of 1940, as amended ("1940 Act"), as open-end management investment
companies. The GT Global Variable Investment Series operates as a series company
currently issuing five classes of shares of beneficial interest: GT Global
Variable New Pacific Fund, GT Global Variable Europe Fund, GT Global Variable
America Fund, GT Global Variable International Fund and GT Global Money Market
Fund. GT Global Variable Investment Trust operates as a series company currently
issuing nine classes of shares of beneficial interest: GT Global Variable Latin
America Fund, GT Global Variable Growth & Income Fund, GT Global Variable
Strategic Income Fund, GT Global Variable Global Government Income Fund, GT
Global Variable U.S. Government Income Fund, GT Global Variable Emerging Markets
Fund, GT Global Variable Telecommunications Fund, GT Global Variable
Infrastructure Fund, and GT Global Variable Natural Resources Fund. (The classes
of shares of beneficial interest for the two companies are referred to herein
collectively as the "Funds".) Each of the Funds is classified as a diversified
management investment company, except for GT Global Variable Latin America Fund,
GT Global Variable Growth & Income Fund, GT Global Variable Strategic Income
Fund and GT Global Variable Global Government Income Fund, which are each
registered as a non-diversified management investment company under the 1940
Act.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates. The following is a summary of
significant accounting policies in conformity with generally accepted accounting
principles consistently followed by the Funds in the preparation of the
financial statements.
(A) PORTFOLIO VALUATION
The Funds calculate the net asset value of and complete orders to purchase,
exchange or repurchase Fund shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.
Equity securities are valued at the last sale price on the exchange on which
such securities are traded, or on the principal over-the-counter market in which
such securities are traded, as of the close of business on the day the
securities are being valued or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by A I M Advisors, Inc. (the
"Manager") to be the primary market.
Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when the
Manager deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost adjusted for foreign exchange
translation and market fluctuation, if any.
Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by, or under the direction of, each of
the Trusts' Board of Trustees.
Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rates, except that when an occurrence subsequent to the
time a value was so established is likely to have materially 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 Trusts' Board of Trustees.
(B) FOREIGN CURRENCY TRANSLATION
The accounting records of the Funds are maintained in U.S. dollars. The market
values of foreign securities, currency holdings, and other assets and
liabilities are recorded in the books and records of the Funds after translation
to U.S. dollars based on the exchange rates on that day. The cost of each
security is determined using historical exchange rates. Income and withholding
taxes are translated at prevailing exchange rates when earned or incurred.
The Funds do not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.
Reported net realized foreign exchange gains and losses arise from sales and
maturities of short-term securities, forward foreign currency contracts, sales
of foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the differences between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Funds' books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
value of assets and liabilities other than investments in securities at year
end, resulting from changes in exchange rates.
F72
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
(C) REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Funds, it is the
Funds' policy to always receive, as collateral, United States government
securities or other high quality debt securities of which the value, including
accrued interest, is at least equal to the amount to be repaid to the Funds
under each agreement at its maturity.
(D) FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward Contract") is an agreement between
two parties to buy and sell a currency at a set price on a future date. The
market value of the Forward Contract fluctuates with changes in currency
exchange rates. The Forward Contract is marked-to-market daily and the change in
market value is recorded by the Funds as an unrealized gain or loss. When the
Forward Contract is closed, the Funds record a realized gain or loss equal to
the difference between the value at the time it was opened and the value at the
time it was closed. Forward Contracts involve market risk in excess of the
amounts shown in the Funds' "Statements of Assets and Liabilities." The Funds
could be exposed to risk if the counterparties are unable to meet the terms of
the contracts or if the value of the currency changes unfavorably. The Funds may
enter into Forward Contracts in connection with planned purchases or sales of
securities or to hedge against adverse fluctuations in exchange rates between
currencies.
(E) OPTION ACCOUNTING PRINCIPLES
When a Fund writes a call or put option, an amount equal to the premium received
is included in the Fund's "Statements of Assets and Liabilities" as an asset and
an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last bid
price, or, in the case of an over-the-counter option, is valued at the average
of the last bid prices obtained from brokers, unless a quotation from only one
broker is available, in which case only that broker's price will be used. If an
option expires on its stipulated expiration date or if a Fund enters into a
closing purchase transaction, a gain or loss is realized without regard to any
unrealized gain or loss on the underlying security, and the liability related to
such option is extinguished. If a written call option is exercised, a gain or
loss is realized from the sale of the underlying security and the proceeds of
the sale are increased by the premium originally received. If a written put
option is exercised, the cost of the underlying security purchased would be
decreased by the premium received. A Fund can write options only on a covered
bases, which, for a call, requires that the Fund hold the underlying securities
and, for a put, requires the Fund to set aside cash, U.S. government securities
or other liquid securities in an amount not less than the exercise price or
otherwise provide adequate cover at all times while the put option is
outstanding. The Funds may use options to manage their exposure to the stock or
bond markets and to fluctuations in currency values or interest rates.
The premium paid by a Fund for the purchase of a call or put option is included
in the Fund's "Statement of Assets and Liabilities" as an investment and
subsequently "marked-to-market" to reflect the current market value of the
option. If an option which a Fund has purchased expires on the stipulated
expiration date, the Fund would realize a loss in the amount of the cost of the
option. If a Fund enters into a closing sale transaction, the Fund would realize
a gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund exercises a call
option, the cost of the securities acquired by exercising the call is increased
by the premium paid to buy the call. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, and the
proceeds from such sale are decreased by the premium originally paid.
The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.
(F) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract a
Fund is required to pledge to the broker an amount of cash or securities equal
to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Fund agrees to receive from or
pay to the broker an amount of cash equal to the daily fluctuation in value of
the contract. Such receipts or payments are known as "variation margin" and are
recorded by the Fund as unrealized gains or losses. When the contract is closed,
the 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 potential risk to the Fund is that the change in value of the
underlying securities may not correlate to the change in value of the contracts.
A Fund may use futures contracts to manage its exposure to the stock or bond
markets and to fluctuations in currency values or interest rates.
(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on a first-in,
first-out basis, unless otherwise specified. Dividends are recorded on the
ex-dividend date. Interest income is recorded on the accrual basis. Where a high
level of uncertainty exists as to the collection of withholding tax rebate,
income is recorded net of all withholding tax with any rebate recorded when
received. A Fund may trade securities on other than normal settlement terms.
This may increase the risk if the other party to the transaction fails to
deliver and causes the Fund to subsequently invest at less advantageous prices.
(H) DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by each Fund on the ex-date. For the
Money Market Fund, dividends are declared daily and
F73
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
paid monthly from net investment income. The Variable Strategic Income Fund,
Variable Global Government Income Fund and Variable U.S. Government Income Fund
declare and pay dividends from net investment income, if any, monthly. The
Variable Growth & Income Fund declares and pays dividends from net investment
income, if any, quarterly. The Variable Latin America Fund, Variable
Telecommunications Fund, Variable New Pacific Fund, Variable Europe Fund,
Variable Emerging Markets Fund, Variable International Fund, Variable America
Fund, Variable Infrastructure Fund, and Variable Natural Resources Fund declare
and pay dividends from net investment income, if any, annually. With respect to
each Fund, dividends from net realized capital gains, if any, are normally
declared and paid annually.
Income and capital gain distributions are determined in accordance with Federal
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 the Fund and timing
differences.
(I) TAXES
It is the policy of the Funds to continue to meet the requirements for
qualification as a "regulated investment company" under the Internal Revenue
Code of 1986, as amended ("Code"). It is also the intention of the Funds to make
distributions sufficient to avoid imposition of any excise tax under Section
4982 of the Code. Therefore, no provision has been made for Federal taxes on
income, capital gains, or unrealized appreciation of securities held, or for
excise tax on income and capital gains. The following funds have capital loss
carryforwards.
<TABLE>
<CAPTION>
CAPITAL LOSS EXPIRES IN
GT GLOBAL FUNDS CARRYFORWARD YEAR
- ------------------------------------------------------------ ------------ ----------
<S> <C> <C>
Variable Strategic Income................................... $ 190,054 2003
Variable Global Government Income........................... 823,063 2002
Variable U.S. Government Income............................. 10,233 2005
Variable Infrastructure..................................... 203,730 2005
Variable New Pacific........................................ 562,115 2003
18,626 2005
</TABLE>
(J) DEFERRED ORGANIZATIONAL EXPENSES
Costs incurred by GT Global Variable Investment Series and Trust in connection
with their organization, which aggregated $125,333 and $188,000, respectively,
are being amortized on a straight-line basis for a five year period. While the
Manager has advanced certain of the Trusts' organizational costs incurred to
date, the Trusts may reimburse the Manager for the amount of these advances. In
the event that the Manager redeems any of the initial 2,083.333 shares of each
of the Variable New Pacific Fund, Variable Europe Fund and Variable America
Fund; or the initial 25,000 shares of Money Market Fund; or the initial
1,666.667 shares of each of the Variable Strategic Income Fund, Variable Global
Government Income Fund, Variable U.S. Government Income Fund, Variable Latin
America Fund and the Variable Growth & Income Fund; or the initial 1.000 share
of the Variable Telecommunications Fund, within the five year amortization
period, the respective Fund's unamortized organizational expenses allocable to
the shares redeemed will be deducted from the Manager's redemption proceeds.
(K) FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent in
investments of domestic origin. The Funds' investments in emerging market
countries may involve greater risks than investments in more developed markets
and the prices of such investments may be volatile. These risks of investing in
foreign and emerging markets may include foreign currency exchange rate
fluctuations, perceived credit risk, adverse political and economic developments
and possible adverse foreign government intervention.
(L) INDEXED SECURITIES
The Funds may invest in indexed securities whose value is linked either directly
or indirectly to changes in foreign currencies, interest rates, equities,
indices, or other reference instruments. Indexed securities may be more volatile
than the reference instrument itself, but any loss is limited to the amount of
the original investment.
(M) RESTRICTED SECURITIES
Certain of the Funds are permitted to invest in a limited amount of privately
placed restricted securities. These securities may be resold in transactions
exempt from registration or to the public if the securities are registered.
Disposal of these securities may involve time-consuming negotiations and
expense, and prompt sale at an acceptable price may be difficult. At the end of
the year, restricted securities (excluding 144A issues) are shown at the end of
the Portfolio of Investments for each Fund, if any.
(N) SECURITIES PURCHASED ON A WHEN-ISSUED OR FORWARD COMMITMENT BASIS
A Fund may trade securities on a when-issued or forward commitment basis, with
payment and delivery scheduled for a future date. These transactions are subject
to market fluctuations and are subject to the risk that the value at delivery
may be less than the trade date purchase price. Although the Fund will generally
purchase these securities with the intention of acquiring such securities, they
may sell such securities before the settlement date. These securities, if any,
are identified on the accompanying Portfolio of Investments. The Variable
Strategic Income Fund and the Variable U.S. Government Income Fund have set
aside sufficient cash or liquid high grade debt securities as collateral for
these purchase commitments.
F74
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
(O) PORTFOLIO SECURITIES LOANED
At June 30, 1998, stocks with an aggregate value listed below were on loan to
brokers. The loans were secured by cash collateral received by the Funds as
follows:
<TABLE>
<CAPTION>
SIX
MONTHS
ENDED
JUNE 30,
JUNE 30, 1998 1998
---------------------------- --------
AGGREGATE VALUE CASH FEES
GT GLOBAL ON LOAN COLLATERAL RECEIVED
- ------------------------------------------------------------ --------------- ---------- --------
<S> <C> <C> <C>
Variable Strategic Income Fund.............................. $ 813,736 $ 889,933 $28,242
Variable Global Government Income Fund...................... 169,221 180,375 4,407
Variable U.S. Government Income Fund........................ -- -- --
Variable Latin America Fund................................. 381,312 400,124 5,848
Variable Growth & Income Fund............................... 2,149,398 2,251,906 20,408
Variable Telecommunications Fund............................ 3,387,452 3,455,600 18,613
Variable Emerging Markets Fund.............................. 128,535 148,284 3,523
Variable Infrastructure Fund................................ 70,844 76,500 1,513
Variable Natural Resources Fund............................. -- -- 720
Variable America Fund....................................... 350,350 365,211 10,412
Variable New Pacific Fund................................... 1,632,603 1,720,503 9,790
Variable Europe Fund........................................ 2,669,145 2,827,819 22,183
Money Market Fund........................................... -- -- --
Variable International Fund................................. 586,768 616,985 4,009
</TABLE>
For international securities, cash collateral is received by the Funds against
loaned securities in an amount at least equal to 105% of the market value of the
loaned securities at the inception of each loan. This collateral must be
maintained at not less than 103% of the market value of the loaned securities
during the period of the loan. For domestic securities, cash collateral is
received by the Funds against loaned securities in an amount at least equal to
102% of the market value of the loaned securities at the inception of each loan.
This collateral must be maintained at not less than 100% of the market value of
the loaned securities during the period of the loan. The cash collateral is
invested in a securities lending trust which consists of a portfolio of high
quality short duration securties whose average effective duration is restricted
to 120 days or less.
(P) LINE OF CREDIT
Certain Funds advised and/or administered by the Manager, have a line of credit
with BankBoston and State Street Bank & Trust Company. The arrangements with the
banks allow the Funds on a first come, first-serve basis, to borrow an aggregate
maximum amount of $250,000,000. The Funds are limited to borrowing up to 33 1/3%
of the value of the Fund's total assets. On June 30, 1998, outstanding loan
balances are as follows:
<TABLE>
<CAPTION>
GT GLOBAL
- ------------------------------------------------------------
<S> <C>
Variable Strategic Income Fund.............................. $ 1,000,000
Variable Global Government Income Fund...................... $ 189,000
Variable America Fund....................................... $ 3,000
Variable Europe Fund........................................ $ 992,000
</TABLE>
For the six months ended June 30, 1998, the average outstanding daily balance of
bank loans (based on the number of days the loans were outstanding), the average
daily interest rate, interest expense for loans and other interest expense are
as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30, 1998
---------------------------------------------------------------------
AVERAGE AVERAGE DAILY
GT GLOBAL OUTSTANDING DAILY BALANCE INTEREST RATE INTEREST EXPENSE
- ------------------------------------------------------------ ------------------------------ ---------------- -------------------
<S> <C> <C> <C>
Variable Strategic Income Fund.............................. $ 1,347,826 6.32% $ 16,323
Variable Global Government Income Fund...................... 136,520 6.30% 1,793
Variable U.S. Government Income Fund........................ 281,333 6.34% 1,308
Variable Latin America Fund................................. 698,226 6.25% 18,178
Variable Growth & Income Fund............................... 3,196,524 6.20% 11,569
Variable Telecommunications Fund............................ -- -- --
Variable Emerging Markets Fund.............................. 610,448 6.29% 13,334
Variable Infrastructure Fund................................ -- -- --
Variable Natural Resources Fund............................. 744,576 6.31% 4,308
Variable America Fund....................................... 886,982 6.31% 17,249
Variable New Pacific Fund................................... 348,375 6.24% 483
Variable Europe Fund........................................ 3,008,967 6.29% 64,660
Money Market Fund........................................... -- -- --
Variable International Fund................................. 470,038 6.33% 2,150
<CAPTION>
GT GLOBAL OTHER INTEREST
- ------------------------------------------------------------ ----------------
<S> <C>
Variable Strategic Income Fund.............................. 94
Variable Global Government Income Fund...................... 466
Variable U.S. Government Income Fund........................ --
Variable Latin America Fund................................. 30
Variable Growth & Income Fund............................... 30
Variable Telecommunications Fund............................ --
Variable Emerging Markets Fund.............................. 720
Variable Infrastructure Fund................................ 152
Variable Natural Resources Fund............................. --
Variable America Fund....................................... --
Variable New Pacific Fund................................... 57
Variable Europe Fund........................................ 121
Money Market Fund........................................... --
Variable International Fund................................. 90
</TABLE>
F75
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
2. RELATED PARTIES
A I M Advisors, Inc. ("AIM" or the "Manager") is the Funds' investment manager
and administrator, and INVESCO (NY), Inc., (formerly, Chancellor LGT Asset
Management, Inc.) is the Funds' investment sub-adviser and/or sub-administrator.
As of the close of business on May 29, 1998, Liechtenstein Global Trust AG
("LGT"), the former indirect parent organization of Chancellor LGT Asset
Management, Inc. ("Chancellor LGT"), consummated a purchase agreement with
AMVESCAP PLC pursuant to which AMVESCAP PLC acquired LGT's Asset Management
Division, which included Chancellor LGT and certain other affiliates. As a
result of this transaction, Chancellor LGT was renamed INVESCO (NY), Inc., and
is now an indirect wholly-owned subsidiary of AMVESCAP PLC. In connection with
this transaction, A I M Advisors, Inc., an indirect wholly-owned subsidiary of
AMVESCAP PLC, became the investment manager and administrator of the Funds and
INVESCO (NY), Inc. became the sub-adviser and sub-administrator of the Funds.
All of the changes became effective as of the close of business on May 29, 1998.
The Money Market Fund pays the Manager an investment management and
administration fee at the annualized rate of 0.50% of that Fund's average daily
net assets. The Variable Strategic Income Fund, Variable Global Government
Income Fund, Variable U.S. Government Income Fund and Variable America Fund each
pays the Manager an investment management and administration fee at the
annualized rate of 0.75% of the Fund's average daily net assets. The Variable
Growth & Income Fund, Variable Latin America Fund Variable, Telecommunications
Fund, Variable New Pacific Fund, Variable Emerging Markets Fund, Variable
International Fund, Variable Europe Fund, Variable Infrastructure Fund, and
Variable Natural Resources Fund each pays the Manager an investment management
and administration fee at the annualized rate of 1.00% of its average daily net
assets. All fees are computed daily and paid monthly.
The Manager has undertaken to limit the total operating expenses (exclusive of
brokerage commissions, interest, taxes and extraordinary items) of each of the
Variable New Pacific Fund, Variable Europe Fund, Variable Latin America Fund,
Variable Telecommunications Fund, Variable Emerging Markets Fund, Variable
International Fund, Variable Infrastructure Fund, Variable Natural Resources
Fund, and the Variable Growth & Income Fund to 1.25% of their respective average
daily net assets. In addition, the Manager has undertaken to limit the total
operating expenses (exclusive of brokerage commissions, interest, taxes and
extraordinary items) of each of the Variable Strategic Income Fund, the Variable
Global Government Income Fund, the Variable U.S. Government Income Fund, and the
Variable America Fund to 1.00% of their respective average daily net assets.
Likewise, the Manager has undertaken to limit the total operating expenses
(exclusive of brokerage commissions, interest, taxes and extraordinary items) of
the Money Market Fund to 0.75% of its average daily net assets. From time to
time, the Manager in its sole discretion may waive its fees and/or voluntarily
assume certain Fund expenses.
All general expenses of the Trusts and joint expenses of the Funds are allocated
among the Funds on a basis deemed fair and equitable.
GT Global, Inc. ("GT Global"), an affiliate of the Manager, is the Funds'
distributor. GT Global Investor Services, Inc. ("GT Services"), an affiliate of
the Manager and GT Global, is the Funds' transfer agent.
GT Global is the principal underwriter of the Variable Annuity Contracts.
Underwriting commissions retained by GT Global are as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
GT GLOBAL JUNE 30, 1998
- ------------------------------------------------------------ -----------------
<S> <C>
Variable Strategic Income Fund.............................. $ 2,292
Variable Global Government Income Fund...................... 196
Variable U.S. Government Income Fund........................ 549
Variable Latin America Fund................................. 638
Variable Growth & Income Fund............................... 5,301
Variable Telecommunications Fund............................ 3,343
Variable Emerging Markets Fund.............................. 1,800
Variable Infrastructure Fund................................ 16,079
Variable Natural Resources Fund............................. 3,827
Variable America Fund....................................... 3,168
Variable New Pacific Fund................................... 1,427
Variable Europe Fund........................................ 2,875
Money Market Fund........................................... 3,224
Variable International Fund................................. 1,082
</TABLE>
The Manager is the pricing and accounting agent for the Funds. The monthly fee
for these services to the Manager is a percentage, not to exceed 0.03% annually,
of each of the Funds' average daily net assets. The annual fee rate is derived
by applying 0.03% to the first $5 billion of assets of all registered mutual
funds advised by the Manager and 0.02% to the assets in excess of $5 billion and
allocating the result according to each Fund's average daily net assets.
The Trusts pay each of their Trustees who is not an employee, officer or
director of the Manager, GT Global or GT Services $5,000 per year.
F76
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
3. PURCHASES AND SALES OF SECURITIES
The following summarizes purchases and sales of investment securities, other
than short-term investments, by Fund, for the six months ended June 30, 1998:
PURCHASES AND SALES OF SECURITIES
<TABLE>
<CAPTION>
PURCHASES
------------------------------
GT GLOBAL U.S. GOVERNMENT OTHER ISSUES
- ------------------------------------------------------------ --------------- ------------
<S> <C> <C>
Variable Strategic Income Fund.............................. $10,295,491 $ 22,940,509
Variable Global Government Income Fund...................... 1,554,863 6,015,666
Variable U.S. Government Income Fund........................ 6,660,617 --
Variable Latin America Fund................................. -- 2,770,323
Variable Growth & Income Fund............................... 4,157,961 12,205,499
Variable Telecommunications Fund............................ -- 21,643,740
Variable Emerging Markets Fund.............................. -- 6,371,673
Variable Infrastructure Fund................................ -- 4,375,001
Variable Natural Resources Fund............................. -- 18,165,230
Variable America Fund....................................... -- 39,378,948
Variable New Pacific Fund................................... -- 5,725,820
Variable Europe Fund........................................ -- 12,921,468
Money Market Fund........................................... -- --
Variable International Fund................................. -- 2,493,509
</TABLE>
<TABLE>
<CAPTION>
SALES
------------------------------
GT GLOBAL U.S. GOVERNMENT OTHER ISSUES
- ------------------------------------------------------------ --------------- ------------
<S> <C> <C>
Variable Strategic Income Fund.............................. $10,250,260 $ 22,716,060
Variable Global Government Income Fund...................... 1,486,951 5,495,012
Variable U.S. Government Income Fund........................ 6,599,975 5,593
Variable Latin America Fund................................. -- 9,309,082
Variable Growth & Income Fund............................... 4,787,890 13,652,754
Variable Telecommunications Fund............................ -- 25,622,078
Variable Emerging Markets Fund.............................. -- 9,157,929
Variable Infrastructure Fund................................ -- 5,426,989
Variable Natural Resources Fund............................. -- 22,072,505
Variable America Fund....................................... -- 43,355,825
Variable New Pacific Fund................................... -- 8,170,756
Variable Europe Fund........................................ -- 7,474,666
Money Market Fund........................................... -- --
Variable International Fund................................. -- 2,319,788
</TABLE>
F77
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
4. CAPITAL SHARES
At June 30, 1998, there were an unlimited number of shares of beneficial
interest authorized, at no par value. Transactions in capital shares of the
Funds were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1997
------------------------------- --------------------------------
GT GLOBAL VARIABLE STRATEGIC INCOME FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 1,062,142 $ 14,359,956 2,611,339 $ 35,310,968
Shares issued in connection with reinvestment of
distributions............................................. 69,285 931,396 151,821 2,041,389
-------------- --------------- --------------- ---------------
1,131,427 15,291,352 2,763,160 37,352,357
Shares repurchased.......................................... (1,364,417) (18,437,601) (3,005,617) (40,609,980)
-------------- --------------- --------------- ---------------
Net decrease................................................ (232,990) $ (3,146,249) (242,457) $ (3,257,623)
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE GLOBAL GOVERNMENT INCOME FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 191,268 $ 2,165,572 380,383 $ 4,229,682
Shares issued in connection with reinvestment of
distributions............................................. 21,080 238,225 55,693 616,309
-------------- --------------- --------------- ---------------
212,348 2,403,797 436,076 4,845,991
Shares repurchased.......................................... (208,040) (2,349,067) (606,738) (6,739,965)
-------------- --------------- --------------- ---------------
Net increase (decrease)..................................... 4,308 $ 54,730 (170,662) $ (1,893,974)
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE U.S. GOVERNMENT INCOME FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 254,724 $ 2,996,577 498,606 $ 5,752,236
Shares issued in connection with reinvestment of
distributions............................................. 14,377 168,832 26,692 304,964
-------------- --------------- --------------- ---------------
269,101 3,165,409 525,298 6,057,200
Shares repurchased.......................................... (350,365) (4,125,945) (375,888) (4,324,042)
-------------- --------------- --------------- ---------------
Net increase (decrease)..................................... (81,264) $ (960,536) 149,410 $ 1,733,158
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE LATIN AMERICA FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 576,628 $ 8,799,142 2,970,336 $ 50,446,691
Shares issued in connection with reinvestment of
distributions............................................. 34,660 451,963 -- --
-------------- --------------- --------------- ---------------
611,288 9,251,105 2,970,336 50,446,691
Shares repurchased.......................................... (1,047,279) (16,316,036) (2,821,639) (48,320,307)
-------------- --------------- --------------- ---------------
Net increase (decrease)..................................... (435,991) $ (7,064,931) 148,697 $ 2,126,384
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE GROWTH & INCOME FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 2,211,098 $ 44,868,308 4,454,366 $ 78,690,743
Shares issued in connection with reinvestment of
distributions............................................. 64,704 1,332,892 78,960 1,391,332
-------------- --------------- --------------- ---------------
2,275,802 46,201,200 4,533,326 80,082,075
Shares repurchased.......................................... (2,231,225) (45,299,031) (4,032,695) (71,425,393)
-------------- --------------- --------------- ---------------
Net increase................................................ 44,577 $ 902,169 500,631 $ 8,656,682
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE TELECOMMUNICATIONS FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 1,125,090 $ 23,180,834 2,426,702 $ 45,966,546
Shares issued in connection with reinvestment of
distributions............................................. 292,704 5,760,403 435,369 7,777,355
-------------- --------------- --------------- ---------------
1,417,794 28,941,237 2,862,071 53,743,901
Shares repurchased.......................................... (1,438,129) (29,717,773) (2,644,456) (49,940,160)
-------------- --------------- --------------- ---------------
Net increase (decrease)..................................... (20,335) $ (776,536) 217,615 $ 3,803,741
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE EMERGING MARKETS FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 1,995,694 $ 21,937,353 4,408,199 $ 64,017,931
Shares issued in connection with reinvestment of
distributions............................................. 93,799 836,683 90,221 1,368,634
-------------- --------------- --------------- ---------------
2,089,493 22,774,036 4,498,420 65,386,565
Shares repurchased.......................................... (2,390,513) (26,418,518) (4,305,787) (63,118,511)
-------------- --------------- --------------- ---------------
Net increase (decrease)..................................... (301,020) $ (3,644,482) 192,633 $ 2,268,054
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
</TABLE>
F78
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1997
------------------------------- --------------------------------
GT GLOBAL VARIABLE INFRASTRUCTURE FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 54,702 $ 948,212 361,007 $ 6,149,550
Shares issued in connection with reinvestment of
distributions............................................. 4,365 76,384 28,498 479,059
-------------- --------------- --------------- ---------------
59,067 1,024,596 389,505 6,628,609
Shares repurchased.......................................... (136,297) (2,331,627) (222,095) (3,775,850)
-------------- --------------- --------------- ---------------
Net increase (decrease)..................................... (77,230) $ (1,307,031) 167,410 $ 2,852,759
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE NATURAL RESOURCES FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 817,259 $ 15,093,904 2,023,682 $ 42,194,979
Shares issued in connection with reinvestment of
distributions............................................. 153,429 1,999,188 42,776 762,160
-------------- --------------- --------------- ---------------
970,688 17,093,092 2,066,458 42,957,139
Shares repurchased.......................................... (1,014,401) (18,614,037) (2,016,632) (41,865,469)
-------------- --------------- --------------- ---------------
Net increase (decrease)..................................... (43,713) $ (1,520,945) 49,826 $ 1,091,670
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE AMERICA FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 1,631,552 $ 36,768,133 2,483,444 $ 49,803,360
Shares issued in connection with reinvestment of
distributions............................................. 307,353 6,036,408 93,176 1,750,776
-------------- --------------- --------------- ---------------
1,938,905 42,804,541 2,576,620 51,554,136
Shares repurchased.......................................... (1,795,102) (40,487,917) (2,660,773) (53,234,901)
-------------- --------------- --------------- ---------------
Net increase (decrease)..................................... 143,803 $ 2,316,624 (84,153) $ (1,680,765)
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE NEW PACIFIC FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 8,938,545 $ 85,305,904 11,514,400 $ 181,130,875
Shares issued in connection with reinvestment of
distributions............................................. 42,293 351,881 17,420 306,408
-------------- --------------- --------------- ---------------
8,980,838 85,657,785 11,531,820 181,437,283
Shares repurchased.......................................... (9,126,322) (88,162,829) (11,774,960) (187,117,722)
-------------- --------------- --------------- ---------------
Net decrease................................................ (145,484) $ (2,505,044) (243,140) $ (5,680,439)
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE EUROPE FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 5,821,275 $ 151,699,130 6,563,342 $ 144,699,282
Shares issued in connection with reinvestment of
distributions............................................. 158,305 3,979,782 115,031 2,473,175
-------------- --------------- --------------- ---------------
5,979,580 155,678,912 6,678,373 147,172,457
Shares repurchased.......................................... (5,588,996) (147,539,729) (6,610,990) (146,386,879)
-------------- --------------- --------------- ---------------
Net increase................................................ 390,584 $ 8,139,183 67,383 $ 785,578
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL MONEY MARKET FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 341,455,359 $ 341,455,359 523,529,726 $ 523,529,726
Shares issued in connection with reinvestment of
distributions............................................. 665,409 665,409 988,414 988,414
-------------- --------------- --------------- ---------------
342,120,768 342,120,768 524,518,140 524,518,140
Shares repurchased.......................................... (337,623,895) (337,623,895) (517,347,993) (517,347,993)
-------------- --------------- --------------- ---------------
Net increase................................................ 4,496,873 $ 4,496,873 7,170,147 $ 7,170,147
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
<CAPTION>
GT GLOBAL VARIABLE INTERNATIONAL FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------ -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Shares sold................................................. 2,661,078 $ 36,610,157 2,840,820 $ 35,258,127
Shares issued in connection with reinvestment of
distributions............................................. 40,537 528,201 621 7,912
-------------- --------------- --------------- ---------------
2,701,615 37,138,358 2,841,441 35,266,039
Shares repurchased.......................................... (2,600,850) (35,783,290) (2,776,796) (34,648,323)
-------------- --------------- --------------- ---------------
Net increase................................................ 100,765 $ 1,355,068 64,645 $ 617,716
-------------- --------------- --------------- ---------------
-------------- --------------- --------------- ---------------
</TABLE>
F79
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
5. EXPENSE REDUCTIONS
The Manager has directed certain portfolio trades to brokers who then paid a
portion of the Funds' expenses. The Funds' expenses were reduced as follows
under these arrangements:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
GT GLOBAL JUNE 30, 1998
- ------------------------------------------------------------ -----------------
<S> <C>
Variable Strategic Income Fund.............................. $ --
Variable Global Government Income Fund...................... --
Variable U.S. Government Income Fund........................ --
Variable Latin America Fund................................. --
Variable Growth & Income Fund............................... 1,237
Variable Telecommunications Fund............................ 1,971
Variable Emerging Markets Fund.............................. 828
Variable Infrastructure Fund................................ 352
Variable Natural Resources Fund............................. 4,656
Variable America Fund....................................... 2,656
Variable New Pacific Fund................................... 4,722
Variable Europe Fund........................................ 998
Money Market Fund........................................... --
Variable International Fund................................. 232
</TABLE>
6. HOLDINGS OF 5% VOTING SECURITIES OF PORTFOLIO COMPANIES
Investments of 5% or more of an issuer's outstanding voting securities by a Fund
or Portfolio are defined in the Investment Company Act of 1940 as an affiliated
company. On June 30, 1998, there were no investments in affiliated companies.
F80
<PAGE>
GT GLOBAL VARIABLE INVESTMENT FUNDS
NOTES
- --------------------------------------------------------------------------------
