<PAGE> 1
DOMINION INSIGHT GROWTH FUND
SEMI-ANNUAL REPORT
DECEMBER 31, 1995
DOMINION INSIGHT GROWTH FUND
A SERIES OF DOMINION FUNDS, INC.
- --------------------------------------------------------------------------------
To Our Shareholders:
Clearly, 1995 was a remarkable year for Dominion Insight Growth Fund (DIGF).
With a total return of 64.7%, DIGF was ranked as the #1 growth fund for the
year by Lipper Analytical Services as reported in The Wall Street Journal.
While our goals for 1996 include above average investment performance, it
should be remembered that 1995 was more the exception.
Yet the equity market remains strong as the economy continues its rather slow
pace. Earnings surprises and volatility are to be expected, especially with
small and mid-cap companies. The market tends to respond dramatically to even
slight differences between projected and reported earnings. This emphasizes
the need to retain qualified management in directing your portfolio.
John A. Knubel, a founding member of DIGF's Board of Directors, was confirmed
by the U.S. Senate as Chief Financial Officer of the Department of Housing and
Urban Development. As a result, he was required to resign his position on all
outside boards. While we will sincerely miss Mr. Knubel's attendance, he
remains a trusted and valuable friend as a shareholder and advisor.
To replace Mr. Knubel, the Board of Directors unanimously elected the Honorable
Allen B. Clark to the Board at its quarterly meeting held in January, 1996.
Following his graduation, in 1963, from the U.S. Military Academy at West
Point, Mr. Clark served his country as an officer in the U.S. Army. Later,
Mr. Clark worked for the United States Department of Veterans Affairs as
Assistant Secretary for Veterans Liaison and as Director of the National
Cemetery System. He also brings extensive experience in managing the affairs
of state government and business, and is well qualified to represent
shareholders as DIGF continues to manage the capital entrusted to it.
We remain committed to serving you, and anticipate 1996 to be a year of superb
performance, expanded services, and shareholder growth.
/s/ DOUGLAS W. POWELL
December 31, 1995 Douglas W. Powell
Chairman of the Board and CEO
The performance data presented does not reflect the deduction of the sales load
and, if reflected, the load would reduce the performance quoted. The
performance data presented represents past performance, and the investment
return and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their original
cost.
<PAGE> 2
DOMINION INSIGHT GROWTH FUND
INVESTMENTS IN SECURITIES
DECEMBER 31, 1995
<TABLE>
<CAPTION>
Common Stocks - 92.92% Shares Value
- ---------------------- ------ -----
<S> <C> <C>
Commercial Services -- 3.46%
Accustaff Inc. (a) 9,180 403,920
Computer- Graphics -- 2.84%
S Three Inc. (a) 18,800 331,350
Computer - Integrated Systems -- 2.95%
Cognex Corporation (a) 9,910 344,372
Computer - Local Network -- 13.39%
3 Com Corporation (a) 9,200 428,950
Ascend Communications (a) 9,600 778,800
Bay Networks (a) 8,625 354,703
Computer - Memory Devices -- 9.10%
C-Cube Microsystems, Inc. (a) 10,860 678,750
Veritas Software (a) 10,100 383,800
Computer - Mini/Micro -- 2.74%
Sun Microsystems (a) 7,010 319,831
Computer - Peripheral Equipment -- 4.36%
US Robotics Corporation (a) 5,800 508,950
Computer - Software -- 26.19%
Electronics For Imaging (a) 10,000 437,500
Hummingbird Communications (a) 7,850 317,925
Informix Corporation (a) 11,200 336,000
Macro Media, Inc. (a) 11,000 574,750
McAfee Association (a) 8,250 361,969
PeopleSoft (a) 8,920 383,560
Quarterdeck Office Systems (a) 9,200 253,000
Structured Dynamics Research Corp. (a) 13,200 391,275
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 3
DOMINION INSIGHT GROWTH FUND
INVESTMENTS IN SECURITIES
DECEMBER 31, 1995
(CONTINUED)
<TABLE>
<CAPTION>
Common Stocks, (continued) Shares Value
- -------------------------- ------ -----
<S> <C> <C>
Electronics - Products - Misc. -- 3.00%
California Amplifier (a) 12,330 348,323
Electronics - Semiconductors -- 2.09%
DSP Communications, Inc. (a) 5,570 242,991
Financial Services - Misc. -- 1.97%
PMT Services (a) 7,580 229,295
Leisure - Toys/Gamers/Hobbies -- 2.74%
Ride Inc. (a) 9,830 320,704
Medical - Generic Drugs -- 3.36%
Watson Pharmaceutical (a) 8,000 392,000
Medical - Products -- 3.73%
Quintiles Transportation (a) 10,600 434,600
Telecommunications - Equipment -- 11.00%
Aspect Telecommunications (a) 9,430 315,905
Pairgain Technologies (a) 4,320 236,520
PictureTel Corporation (a) 9,200 396,750
Stratacom Inc. (a) 4,530 332,955
------ ------------
Total Investments in Securities
(cost $7,167,271) $ 10,839,448
============
</TABLE>
Note: (a) Presently not paying dividend income.
Percentage of investments as shown is the ratio of the total
market value to total assets
The accompanying notes are an integral part of these financial statements.
<PAGE> 4
DOMINION INSIGHT GROWTH FUND
Statement of Assets and Liabilities
December 31, 1995
(unaudited)
<TABLE>
<CAPTION>
Assets
<S> <C>
Investments in securities, at value-
identified cost of $7,167,271 (Note 2) $ 10,839,448
Cash 824,915
Receivables
Capital shares sold 145,681
Interest 1,250
Organization costs, net 14,305
--------------
TOTAL ASSETS 11,825,599
--------------
Liabilities
Payables
Administrative fee 12,034
Investment advisory fee 9,652
Distribution to shareholder 10
--------------
TOTAL LIABILITIES 21,696
--------------
Net Assets $ 11,803,903
==============
Shares outstanding 744,791
Net asset value and offering price per share
Net asset value per share 15.85
Offering price per share 16.43
</TABLE>
The accompanying notes are an integral part of these financial statem
<PAGE> 5
DOMINION INSIGHT GROWTH FUND
Statement of Operations
For The Six Months Ended December 31, 1995
(unaudited)
<TABLE>
<CAPTION>
Investment income
<S> <C>
Income
Dividends $ 422
Interest 9,754
--------------
Total Investment Income 10,176
--------------
Expenses
Investment advisory fee (Note 6) 50,419
Administrative fee (Note 6) 63,025
Amortization 4,810
--------------
Total Expenses 118,254
--------------
Net Investment Loss (108,078)
--------------
Realized and unrealized gain on investments
Net realized gain on investments 1,280,931
Unrealized appreciation on investments 1,235,432
--------------
Net gain on investments 2,516,363
--------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 2,408,285
==============
</TABLE>
The accompanying notes are an integral part of these financial statem
<PAGE> 6
DOMINION INSIGHT GROWTH FUND
Statement of Changes in Net Assets
For The Six Months Ended December 31, 1995
(unaudited)
<TABLE>
<CAPTION>
Change in net assets from operations
<S> <C>
Net investment loss $ (108,078)
Net realized gain on investments 1,280,931
Change in unrealized appreciation 1,235,432
------------
Net increase in net assets from
operations 2,408,285
Capital share transactions (Note 3) 2,310,306
Shareholder distributions (Note 4) (1,003,826)
------------
Total Increase 3,714,765
Net assets
Beginning of period 8,089,138
------------
END OF PERIOD (including undistributed $ 11,803,903
investment loss of $489,077) ============
</TABLE>
The accompanying notes are an integral part of these financial statments.
<PAGE> 7
DOMINION INSIGHT GROWTH FUND
Financial Highlights
<TABLE>
<CAPTION>
Six Months Ended Year Ended
December 31, 1995 June 30, 1995
(unaudited)
(1)(2) (2)
----------------- -------------
Per Share Income and Capital Changes
for a Share Outstanding During the
Period:
<S> <C> <C>
Net asset value, beginning of $ 13.53 $ 10.24
---------- ------------
Income From Investment Operations:
Net investment loss (0.15) (0.24)
Net realized and unrealized gains
(losses) on securities 3.83 4.33
---------- ------------
Total from investment operations 3.68 4.09
---------- ------------
Less Distributions:
Dividends from net investment incom 0 0
Distributions from net realized gai (1.36) (0.80)
Returns of capital 0.00 0
---------- ------------
Total distributions (1.36) (0.80)
---------- ------------
Net asset value, end of period $ 15.85 $ 13.53
========== ============
Total return (3) (4) 34.28% 42.25%
========== ============
Ratios to Average Net Assets/Supplemental
Data:
Net assets, end of period (in $ 11,804 $ 8,089
Ratio of expenses to average net as 1.19% 2.38%
Ratio of net investment loss to ave 1.08% 2.16%
Portfolio turnover rate 73.15% 210.23%
</TABLE>
(1)Other than total return, financial highlights have not been
(2)Per share information has been calculated using the average
(3)Sales load is not reflected in total return.
(4)Total return is annualized, and net of capital gains distri
The accompanying notes are an integral part of these financial statements.
<PAGE> 8
DOMINION INSIGHT GROWTH FUND
Notes to Financial Statements
Note 1 - Organization and Nature of Operations
Dominion Insight Growth Fund (the "Fund") is a separate series
of shares of common stock of Dominion Funds, Inc. (the
"Company"). The Company was incorporated in the State of Texas
on June 5, 1992. The Company is registered under the
Investment Company Act of 1940 as a diversified, open-end
management investment company. The Fund is subject to various
investment restrictions as set forth in the Statement of
Additional Information. The effective date of the Fund's
Registration Statement under the Securities Act of 1933 was
October 27, 1992. The primary investment objective of the
Fund is capital appreciation. The Company may designate one
or more series of common stock. The only series currently
designated is the Fund. Each share represents an equal
proportionate interest in the assets of the Fund with each
other share in such series and no interest in any other
series.
Note 2 - Summary of Significant Accounting Policies
Use of Estimates in the Preparation of Finacial Statements
The preparation of financial statements in conformity with
generally accepted accounting principles requires mangement to
make estimates and assumptions that affect the reported
amounts of the assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
those estimates.
Security Valuation
Investments in securities traded on a national securities
exchange (or reported on the NASDAQ national market) are
stated at the last reported sales price on the day of
valuation; other securities traded in the over-the-counter
market and listed securities for which no sale was reported on
that date are stated at the last quoted bid price. Other
securities for which quotations are not readily available are
valued at fair value as determined by the Board of Directors.
Security Transactions and Related Investment Income
The Company follows industry practice and records security
transactions on the trade date. Dividend income is recognized
on the ex-dividend date, and interest income is recognized on
an accrual basis. Realized security gains and losses are
reported on an identified cost basis.
<PAGE> 9
DOMINION INSIGHT GROWTH FUND
Notes to Financial Statements
Note 2 - Summary of Significant Accounting Policies, continued
Cash
Cash is held in a credit interest account at May Financial
Corporation, a member of the Chicago Stock Exchange, Inc.,
bearing interest at a variable rate. At December 31, 1995,
the interest rate was 4.781%.
Organization Costs
Organization costs have been capitalized and are being
amortized on a straight-line basis over a period of five
years. If any of the initial shares are redeemed before all
the organizational costs have been amortized, the proceeds
will be reduced by the redeemed share's pro rata share of the
then- unamortized organization costs, in the same proportion
as the number of shares redeemed bears to the total number of
initial shares outstanding.
Income Taxes
The Fund intends to qualify, under the Internal Revenue Code,
as a regulated investment company and if so qualified, will
not have to pay federal income taxes to the extent its taxable
net income is distributed. On a calendar year basis, the Fund
is subject to a 4% federal excise tax to the extent it does
not distribute substantially all of its net investment income
and realized gains, if any.
Net investment income, net realized gains and the cost of
investments in securities may differ for financial statement
and tax purposes because of book-to-tax differences. The
character of distributions from net investment income or net
realized gains may therefore differ form their ultimate
characterization for federal income tax purposes. At December
31, 1995, there were no material differences. Also, due to
the timing of dividend distributions, the fiscal year in which
amounts are distributed may differ from the year that the
income or realized gains were recorded by the Fund.
Income and Capital Gains Distributions
It is the policy of the Fund to generally pay annual
distributions from net investment income and make
distributions of any realized capital gains as required by
law. These dividends are recorded on the ex-dividend date,
and are reinvested in additional shares of the Fund at net
asset value or are payable in cash without any charge to the
shareholder.
<PAGE> 10
DOMINION INSIGHT GROWTH FUND
Notes to Financial Statements
Note 3 - Capital Share Transactions
There were 1,000,000,000 shares of $.001 par value capital
stock authorized of which 200,000,000 shares are classified as
the Fund's series and the balance is unclassified. As of
December 31, 1995, capital paid-in aggregated $8,255,128.
Transactions in capital stock for the six months ended
December 31, 1995 were as follows:
<TABLE>
<CAPTION>
Shares Amount
------ ------
<S> <C> <C>
Shares sold 140,760 $ 2,181,321
Shares issued in reinvestment
of dividends 61,981 987,344
------- -----------
202,741 3,168,665
Shares redeemed 56,007 858,359
------- -----------
Net increase 146,734 $ 2,310,306
======= ===========
</TABLE>
Note 4 - Distribution To Shareholders
On November 09, 1995, a distribution of $1.54 aggregating
$1,003,826 was declared from net realized gains from
investment transactions. The dividend was paid on November
30, 1995, to all shareholders of record on November 29, 1995.
Note 5 - Investment Transactions
Purchases of investment securities and sales of investment
securities (excluding short-term securities) for the six
months ended December 31, 1995 were $7,215,628 and $6,784,856,
respectively, for common stocks. The cost of securities for
federal income taxes is the same as that shown in the schedule
of investments. Net gain on investments for the six months
ended December 31, 1995, was $2,516,363. All security
transactions were in long transactions. As of December 31,
1995, the aggregate gross unrealized appreciation and
depreciation of securities was as follows:
<TABLE>
<S> <C>
Unrealized appreciation $ 3,749,081
Unrealized depreciation (76,904)
------------
Net unrealized appreciation $ 3,672,177
============
</TABLE>
<PAGE> 11
DOMINION INSIGHT GROWTH FUND
Notes to Financial Statements
Note 6 - Investment Advisory Fees and Other Agreements and Transactions
with Affiliates
The Fund has an Investment Advisory Agreement (the "Advisory
Agreement") with Insight Capital Management, Inc. (the
"Advisor") to act as its investment advisor. The Advisor also
serves as investment advisor to certain private accounts. The
Advisor provides the Fund with investment advice and
recommendations for the Fund consistent with its investment
objective, policies and restrictions, and supervises the
purchase and sale of security transactions on behalf of the
Fund, including the negotiation of commissions and the
allocation of principal business and portfolio brokerage. For
such services, the Advisor receives an annual fee of 1.0% of
the Fund's average daily net assets, computed daily and paid
on a monthly basis.
The Fund has an Administration Agreement with Dominion
Institutional Services Corporation (the "Administrator").
Pursuant to the Administration Agreement, and subject to the
authority of the Board of Directors of the Company, the
Administrator is responsible for the administration of the
Fund and overall management of the Fund's business affairs.
The Administrator provides all services required to carry on
the Fund's general administrative and corporate affairs.
These services include furnishing all executive and managerial
personnel, office space and equipment, and providing federal
and state regulatory compliance. For its services, the
Administrator receives an annual fee of 1.25% of the Fund's
average daily net assets, computed daily and paid on a monthly
basis.
The Fund has entered into a Distribution Agreement with
Dominion Capital Corporation (the "Distributor") pursuant to
which the Distributor performs services and bears the expenses
relating to the offering of Fund shares for sale to the
public. As compensation for the services provided and
expenses borne by the Distributor, the Fund pays the
Distributor the sales charges. Sales charges received by the
Distributor for Fund shares sold for the six months ended
December 31, 1995 were approximately $37,747.
During the six months ended December 31, 1995, all orders for
the Fund's portfolio securities transactions were placed
through the Distributor, and it is expected that the Advisor
will continue to place such orders with the Distributor.
Commissions received by the Distributor for executing
portfolio transactions for the six months ended December 31,
1995 were approximately $41,997.
Certain directors and officers of the Company are also
directors, officers, and/or employees of the Administrator
and the Distributor.
<PAGE> 12
NOTES
-----
<PAGE> 13
NOTES
-----
<PAGE> 14
DOMINION INSIGHT GROWTH FUND
SEMI-ANNUAL REPORT
DECEMBER 31, 1995
Officers
Douglas W. Powell
Chairman and Chief Executive Officer
C. Dewey Elliott, III
President
Directors
Douglas W. Powell
C. Dewey Elliott, III
Robert H. Spiro, Jr.
Peter R. Goldschmidt
John A. Knubel
Investment Advisor
Insight Capital Management, Inc.
1656 North California Blvd., Suite 300
Walnut Creek, CA 94696
Administrator
Dominion Institutional Services Corporation
5000 Quorum Dr., Suite 620
Dallas, TX 75240
Distributor
Dominion Capital Corporation
5000 Quorum Dr., Suite 620
Dallas, TX 75240
Custodian
May Financial Corporation
8333 Douglas Ave., Suite 400
Dallas, TX 75225
Transfer Agent
Fund Services, Inc.
1500 Forest Avenue, Suite 111
Richmond, VA 23229
Independent Auditors
Kinder & Wyman, P.C.
Certified Public Accountants
511 E. John Carpenter Freeway
Suite 200
Irving, TX 75062
Legal Counsel
Frederick C. Summers, III
A Professional Corporation
3700 Bank One Center
1717 Main Street
Dallas, TX 75201
<PAGE> 15
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<PAGE> 16
DOMINION CAPITAL CORPORATION
5000 Quorum Drive, Suite 620
Dallas, Texas 75240
