[Logo Omitted]
We Bring good things to life.
GE Funds
Annual Report
[Graphic Omitted[
September 30, 1998
<PAGE>
Understanding Your Report
President's Letter ................................. 1
Review of Performance and Schedules of Investments
Portfolio managers discuss your Funds and what we
invested in and why
GE International Funds .......................... 3
o GE International Equity Fund
o GE Global Equity Fund
GE Premier Growth Equity Fund ................... 12
GE U.S. Equity Fund ............................. 15
GE Mid-Cap Growth Fund .......................... 20
GE Value Equity Fund ............................ 24
GE Strategic Investment Fund .................... 28
GE Tax-Exempt Fund .............................. 36
GE Fixed Income Funds ........................... 41
o GE Fixed Income Fund
o GE Government Securities Fund
o GE Short-Term Government Fund
o GE Money Market Fund
Notes to Performance ............................ 56
Notes to Schedules of Investments ............... 57
Financial Statements
Financial Highlights ............................ 58
Notes to the Financial Highlights ............... 69
Statements of Assets and Liabilities,
Operations, and Changes in Net Assets ........... 70
Notes
Notes to the Financial Statements ............... 78
Report of Independent Accountants .................. 86
Tax Information .................................... 87
GE Funds' Investment Team .......................... 88
Shareholder Inquiries ........................Inside Back Cover
How you can obtain more information
Top Rated GE Funds
BY MORNINGSTAR
THROUGH SEPTEMBER 30, 1998
*****
OVERALL AND 3 YEARS RATINGS
FUNDS NUMBER OF FUNDS
FUND/CLASS PEER GROUP IN PEER GROUP
- --------------------------------------------------------------------------------
GE US EQUITY-D Domestic Equity 2678
GE SHORT-TERM GOV'T-D Taxable Bond 1491
- --------------------------------------------------------------------------------
****
OVERALL AND 3 YEARS RATINGS
FUNDS NUMBER OF FUNDS
FUND/CLASS PEER GROUP IN PEER GROUP
- --------------------------------------------------------------------------------
GE INTERNATIONAL
EQUITY - C & D International Equity 819
GE US EQUITY - A, B, & C*
GE STRATEGIC INVESTMENT - D Domestic Equity 2678
GE VALUE EQUITY - A* & B*
GE FIXED INCOME - D Taxable Bond 1491
GE SHORT-TERM GOV'T. - C
- --------------------------------------------------------------------------------
Morningstar is an independent fund rating company that seeks to provide a
non-biased rating system used in making investment decisions. A fund is rated in
its investment class on a scale of one to five stars through the evaluation of
the historical balance of risk and return after 3 years' performance.
Morningstar proprietary ratings reflect historical risk-adjusted performance
through September 30, 1998. The ratings are subject to change every month.
Morningstar ratings are calculated from a fund's three-, five- and ten-year
returns (with fee and sales charge adjustments) in excess of 90-day T-Bill
returns. The top ten percent of the funds in a rating category receive five
stars and the next 22.5% receive four stars.
Star ratings for the Funds and/or classes of shares not shown above were lower
than those shown. Investment return and principal value of an investment will
fluctuate and you may have a gain or loss when you sell your shares. The adviser
has voluntarily agreed to waive and/or bear certain fees and expenses. Without
these provisions, which may be terminated in the future, the results may have
been lower. Returns assume changes in share price and reinvestment of dividends
and capital gains. Past performance is no guarantee of future results.
* Funds were rated among 1584 funds for the 5 year period in the Domestic
Equity category
- --------------------------------------------------------------------------------
This report has been prepared for shareholders and may be distributed to others
only if preceded or accompanied by a current prospectus.
<PAGE>
A LETTER FROM THE PRESIDENT
[PICTURE OF Michael J. Cosgrove OMITTED]
DEAR SHAREHOLDER:
We are pleased to provide you with the 1998 GE Funds Annual Report.
At GE Mutual Funds, we continue to focus on customer service and fund
performance. Recently, we added a useful new service, the GE Mutual Fund web
site (WWW.GE.COM/MUTUALFUNDS). The site offers helpful fund information,
practical financial and retirement planning tools, and a wide range of other
data. Additionally, we have taken the initiative to look for opportunities to
add new funds to the GE Fund family in an effort to provide our shareholders
with greater levels of investment flexibility and asset diversification. We are
therefore excited to announce the October 1st start of the GE Small-Cap Value
Equity Fund. This is a part of our continuing plan to provide you with tools to
build portfolios the way you want. Look for announcements of more new GE Funds
in the upcoming months.
Turning to performance, this has been a rugged year for stocks. We saw the Dow
reach historic highs, take its deepest one-day point plunge, recover, and then
drop steeply again as growing global economic turmoil shook the U.S. financial
system. What follows will give you a snapshot of what occurred during the year
and how we expect events to play out in the months ahead.
FUND HIGHLIGHTS
During the past 12 months, the GE family of funds continued to grow as a steady
stream of cash flowed in from investors. This is a noteworthy accomplishment.
Many funds had significant withdrawals as investors reacted to stock market
turmoil. In August, equity funds reportedly experienced their first net cash
outflows in eight years. In contrast, cash continued to flow into the GE equity
funds in August, as it had all year. In fact, August was one of the best net
cash inflow months experienced by GE equity funds during the year.
Despite the market's choppiness, a number of GE equity funds outperformed their
benchmarks and peer groups for the 12 months ending September 30, 1998. All
classes of the GE Premier Growth Equity Fund had double-digit performances,
gaining more than 12% for the year. The GE Premier Growth Equity Fund
outperformed the S&P 500 Index with a return of 9.12% and far exceeded the
average for its Lipper Growth peer group, which reported a loss of 1.44%. All
classes of the GE Value Equity, GE Strategic Investment and GE International
Equity Fund also outperformed the average of their Lipper peers. Lipper is an
independent mutual fund rating service. Average returns for all fund categories
and complete details on each fund's performance, including the reductions for
the effect of loads, can be found in this report's fund performance profile
pages.
As expected during uncertain times, fixed income funds produced higher returns
than in recent years. GE's fixed income funds were in line with this trend.
Showing the strength of treasuries, the Government Fund achieved double-digit
returns for the year.
Many of our funds continued to earn favorable ratings from Morningstar, an
independent fund ranking company that analyzes risk-adjusted performance.
Highly-rated funds are listed on the inside front cover of this report.
MARKET REVIEW
Early in 1998, the stock market seemed to be setting the pace for its fourth
year of more than 20% annual gains. The economy was steady, Asia was apparently
calm and the controversies surrounding the White House abated. In mid-July, the
Dow reached 9337.97, its highest historic level.
The surprise collapse of the Russian stock market in August triggered a
world-wide stock market slide. As uncertainty in Asia came back to the
forefront, the turbulence in Russia spread to Latin America and other emerging
markets where U.S. companies have much larger exposure than they do in Russia,
U.S. corporate earnings came under pressure and exports fell to their lowest
levels in a decade.
1
<PAGE>
A LETTER FROM THE PRESIDENT (CONTINUED)
Continental Europe was a bright spot for much of the period, with markets
posting double-digit gains through August. Barring unforeseen events, they
should quickly snap back from blows delivered by their investments in Russia and
other emerging markets. European economies and corporate profits continue to
grow as companies ready themselves for a single currency.
Three events fueled market jitters in September. In Washington, the U.S.
Congress began deliberating whether to impeach the President. The U.S. Federal
Reserve Bank helped organize the rescue of a large American investment fund
whose collapse could have threatened world financial markets. And, in hopes of
cushioning the U.S. economy, the Federal Reserve (the "Fed") cut the short-term
interest rate by a quarter-percentage point, the first reduction in nearly three
years.
At the end of September, the yield on the benchmark 30-year Treasury Bond fell
below 5% for the first time in 30 years. U.S. treasuries and other government
securities were major beneficiaries of the Fed's action and world market
volatility. For two quarters now, investors have moved into treasuries because
of their safety and liquidity. Their performance exceeded that of corporate
bonds and other bonds with credit risk during the period.
MARKET OUTLOOK
This is a time for caution. Volatility should continue at least through early
1999 as the market deals with uncertainty. We expect earnings disappointments
when companies report third and fourth quarter results. However, the U.S.
economy's underlying fundamentals remain fairly strong. Interest rates and
inflation are low, companies are productive and unemployment numbers, while
beginning to rise, are still good.
We expect fixed income securities to continue performing well in the next
quarter as investors trade risk for safety. With respect to the stock market,
bargains exist in small-caps, in the capital goods, financial and energy
sectors, and in large pharmaceuticals whose earnings are driven by new products,
rather than the economic cycle.
The global correction also presents opportunities for bargain-hunting in Europe
and emerging markets in Asia and Eastern Europe, as well as in Israel and
Mexico.
As prices rise and fall, it is best to focus on long-term investment objectives
rather than on short-term market fluctuations.
On a final note, many shareholders have inquired about the Year 2000. GE
Investment Management has incorporated Year 2000 analysis into its investment
decision making process. GE Investment Management has also been working to
identify and address Year 2000 date-related issues in a broad range of areas
including applications, process-enabling systems and facilities. With respect to
third-party systems, GE Investment Management, like many other similarly
situated companies, must largely rely on the efforts and affirmations of others.
Although the interaction of various software and hardware elements is highly
complex - and the possibility of Year 2000 related problems cannot be totally
eliminated - GE Investment Management believes it is taking appropriate steps.
/s/ signature omitted
Michael J. Cosgrove
Mike Cosgrove is the President of the Investment Services Group of GE Financial
Assurance Holdings, Inc. and GE Investment Distributors, Inc., the funds'
distributor. In this role, he is responsible for the marketing, product
development and sales of the funds, and is also a Trustee of the GE Pension
Trust and GE's employee savings program.
In Mike's previous position as Chief Financial Officer of GE Investments and
Assistant Treasurer-GE Company, he had financial responsibility for all assets
under GE Investments' management. Mike joined GE in 1970. After completing the
GE Financial Management Program, he held a number of managerial positions in
finance and sales in the International Operation, including serving as Vice
President and Treasurer and later as the Vice President - Countertrade and
Barter for GE Trading Company.
Mike graduated from Fordham University in 1970 with a B.S. degree in
Economics and received his M.B.A. degree from St. John's University in 1973.
2
<PAGE>
GE INTERNATIONAL FUNDS
Q & A
[Picture of Ralph Layman & Michael J. Solecki omitted]
Ralph Layman (pictured on the left) manages the international equity operation
with assets under management exceeding $9 billion. He leads a team of portfolio
managers for the GE International Equity Fund and shares portfolio management
responsibility for the GE Global Equity Fund with Michael J. Solecki. Prior to
joining GE Investments in 1991, Ralph was Executive Vice President, Partner and
Portfolio Manager of the International Equity Operations at Northern Capital
Management. Previously, he was a Vice President and Portfolio Manager at
Templeton Investment Counsel, Inc. He was instrumental in forming Templeton's
Emerging Markets Fund, the first listed emerging markets equity fund in the U.S.
Ralph is a Trustee of the GE Pension Trust, and GE's employee savings program,
and serves on the GE Investments' Asset Allocation Committee. He is a Chartered
Financial Analyst, a charter member of the International Society of Security
Analysts and a member of the New York Society of Security Analysts. Ralph is a
graduate of the University of Wisconsin with a B.S. in Economics and a M.S. in
Finance.
Michael J. Solecki is Co-Portfolio Manager of the GE Global Equity Fund and has
served the fund in that capacity since September 1997. Mike has more than nine
years of investment experience and has held positions with GE Investments since
1990. He is currently a Vice President of GE Investments. Mike is a Chartered
Financial Analyst and a member of the New York Society of Security Analysts. He
holds a B.S. in Finance from Western New England College.
Q. HOW DID THE GE INTERNATIONAL EQUITY AND GE GLOBAL EQUITY FUNDS' INDUSTRY
BENCHMARKS AND LIPPER PEERS PERFORM FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER
30, 1998?
A. The GE International Equity Fund's benchmark, the MSCI EAFE was down 8.34%.
Our Lipper peer group of 542 International Stock funds fell 10.40% for the
same period.
The GE Global Equity Fund's benchmark the MSCI World Index, returned 0.14%.
Our Lipper peer group of 233 Global Stock funds fell 9.10% for the same
period.
To see how your class of shares in the above funds performed compared to its
benchmarks, please refer to page 4 for the GE International Equity Fund and
page 8 for the GE Global Equity Fund.
Q. WHAT DROVE THE FUNDS' PERFORMANCE?
A. The GE International Equity Fund's overweighting in Europe, which helped the
fund outperform its benchmark for most of the year, was neutralized in August
when the Asian economic crisis suddenly spread first to Russia, then to Latin
America. United Kingdom (U.K.) holdings with exposure in Asia and Russia
suffered the largest losses. Latin American equities, which toppled by an
average of 40%, also undermined the fund's performance while Asian and
Japanese equities had slight positive effects.
The GE Global Equity Fund entered 1998 with low exposure in Far Eastern
markets. Therefore, the region's poor performance later in the year had a
marginal effect. Continental European companies, where the fund has 48% of
its holdings, helped fuel fund performance for much of the year but these
advances were beaten back during the third quarter, when European markets
fell nearly 16% due to the ongoing Asian economic crisis and the collapse of
Russia's economy. The fund's performance was also edged lower by a drop in
Latin American equities, which represents 3% of the fund. For most of the
year, the U.S. market outperformed other world markets. However, it too
retreated 9.9% in the third quarter. The decline in average U.S. stocks was
much greater than the stock-index decline. On the New York Stock Exchange,
the S&P 500 dropped 19% from its peak but the average stock was down 32%.
Q. WHAT CHANGES DID YOU MAKE IN THE FUNDS?
A. In the GE International Equity Fund, because Latin America's investment
picture is shaky, we sold a significant portion of Telebras (Telecomunicacoes
Brasileiras), the Brazilian telecommunications company, when the government
privatized it. We added two U.K.-based companies, Somerfield, a restructuring
retailer and Cable and Wireless Communications, the U.K.'s second largest
telecommunications provider, which has had 25% growth and good margins. The
GE International and Global Equity Funds acquired Munich Reinsurance
(Muencheners), a restructuring global company; food retailers Jeronimo
Martins of Portugal, which is expanding into Brazil and Poland, and SEMA, a
leading European-based software company. Because of the poor outlook for
commodities, we also sold our stake in Du Pont. In both funds, we added
Koninklijke Ahold, a Netherlands-based retailer which has significant
interests in the U.S., Europe and Latin America and sold off Hong Kong-based
HSBC when the government began buying stock to fend off speculators.
Q. WHAT IS YOUR OUTLOOK FOR THE FUNDS?
A. Until the Russian ruble collapsed, Europe's economic growth looked strong as
countries readied for a common currency. Because long-term growth still
appears favorable, we do not plan to make any major changes in our
portfolios. In Asia, Japan holds the key to economic recovery. Weakness
should continue in the region until the Japanese government enacts
significant structural changes. Because most companies in other parts of Asia
are in deep recession, investments there would be highly speculative.
However, we continue to have a small investment in emerging markets,
particularly in Latin America and Israel. Even though investments in these
regions became riskier in the third quarter, some undervalued companies
should deliver over the long term. We will wait to see what actions the
International Monetary Fund takes before moving new capital into the region.
3
<PAGE>
GE INTERNATIONAL EQUITY FUND
======================================================================
TOP TEN LARGEST HOLDINGS
AT SEPTEMBER 30, 1998
======================================================================
Total S.A. (Class B) 3.39%
- ----------------------------------------------------------------------
Mannesmann AG 3.10%
- ----------------------------------------------------------------------
Nokia Oyj 2.90%
- ----------------------------------------------------------------------
Cap Gemini S.A. 2.51%
- ----------------------------------------------------------------------
AXA-UAP 2.43%
- ----------------------------------------------------------------------
Preussag AG 2.36%
- ----------------------------------------------------------------------
Siebe PLC 2.35%
- ----------------------------------------------------------------------
ING Groep N.V. 2.30%
- ----------------------------------------------------------------------
Pharmacia & Upjohn Inc. 2.10%
- ----------------------------------------------------------------------
Airtours PLC 2.00%
- ----------------------------------------------------------------------
INVESTMENT PROFILE
A mutual fund designed for investors who seek long-term growth of capital by
investing primarily in foreign equity securities.
* LIPPER PERFORMANCE COMPARISON
International Stock Peer Group
Based on average annual total returns for the period ended 9/30/98
One Three
Year Year
Number of Funds
in peer group: 542 322
Peer group
average
total return: -10.40% 4.82%
Lipper categories in peer group:
International, Canadian, International Small Cap
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A W/O LOAD WITH LOADEAFE
3/2/94 10000 10000 10000
3/31/94 9753.33 9290.05 9569.11
6/30/94 9753.32 9290.04 10057.82
9/30/94 10119.99 9639.29 10067.63
12/30/94 9622.69 9165.62 9965.09
3/31/95 9682.87 9222.94 10150.54
6/30/95 10298.07 9808.92 10224.17
9/30/95 10612.37 10108.28 10650.7
12/30/95 11003.64 10480.96 11082.14
3/30/96 11338.5 10799.92 11402.31
6/30/96 11700.15 11144.39 11582.47
9/30/96 11820.71 11259.23 11568.67
12/30/96 12325.49 11616.78 11751.94
3/30/97 12456.76 11740.5 11568.12
6/30/97 13817.82 13023.29 13069.01
9/30/97 13997.45 13192.6 12977.06
12/30/97 13044.86 12294.78 11960.97
3/30/98 15334.54 14452.81 13720.41
6/30/98 15564.31 14669.36 13866.18
9/30/98 12748 12011 11895.38
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Int'l Equity -8.93% 6.30% 5.44%
GE Int'l Equity w/load -14.18% 4.22% 4.08%
(maximum load-5.75%)
MSCI EAFE -8.34% 3.75% 3.86%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
QUARTERLY W/O LOAD WITH LOADEAFE
3/2/94 10000 10000 10000
3/31/94 9753.33 9753.33 9569.11
6/30/94 9740 9740 10057.82
9/30/94 10086.65 10086.65 10067.63
12/30/94 9582.65 9582.65 9965.09
3/31/95 9629.36 9629.36 10150.54
6/30/95 10223.29 10223.29 10224.17
9/30/95 10523.58 10523.58 10650.7
12/30/95 10897.29 10897.29 11082.14
3/30/96 11210.92 11210.92 11402.31
6/30/96 11557.93 11557.93 11582.47
9/30/96 11658.03 11658.03 11568.67
12/30/96 12141.03 12141.03 11751.94
3/30/97 12257.71 12257.71 11568.12
6/30/97 13575.46 13575.46 13069.01
9/30/97 13740.18 13640.18 12977.06
12/30/97 12793.89 12793.89 11960.97
3/30/98 15011.34 15011.34 13720.41
6/30/98 15223.37 15223.37 13866.18
9/30/98 12450 12450 11895.38
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Int'l Equity -9.39% 5.76% 4.90%
GE Int'l Equity w/load -12.32% 5.21% 4.90%
maximum load 4.0% 2.0% 0.0%
MSCI EAFE -8.34% 3.75% 3.86%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS
CLASS C
QUARTERLY W/O LOAD EAFE
3/2/94 10000 10000
3/31/94 9760 9569.11
6/30/94 9760 10057.82
9/30/94 10126.66 10067.63
12/30/94 9636.58 9965.09
3/31/95 9703.64 10150.54
6/30/95 10320.59 10224.17
9/30/95 10649.18 10650.7
12/30/95 11036.55 11082.14
3/30/96 11379.76 11402.31
6/30/96 11756.63 11582.47
9/30/96 11877.76 11568.67
12/30/96 12398.08 11751.94
3/30/97 12543.6 11568.12
6/30/97 13915.78 13069.01
9/30/97 14109.82 12977.06
12/30/97 13161.44 11960.97
3/30/98 15473.21 13720.41
6/30/98 15711.92 13866.18
9/30/98 12882 11895.38
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Int'l Equity -8.71% 6.55% 5.68%
MSCI EAFE -8.34% 3.75% 3.86%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS
CLASS D
QUARTERLY W/O LOAD EAFE
3/2/94 10000 10000
3/31/94 9760 9569.11
6/30/94 9773.34 10057.82
9/30/94 10146.67 10067.63
12/30/94 9666.15 9965.09
3/31/95 9733.29 10150.54
6/30/95 10357.55 10224.17
9/30/95 10699.89 10650.7
12/30/95 11103.89 11082.14
3/30/96 11461.43 11402.31
6/30/96 11845.95 11582.47
9/30/96 11980.87 11568.67
12/30/96 12508.42 11751.94
3/30/97 12669.13 11568.12
6/30/97 14066.73 13069.01
9/30/97 14276.37 12977.06
12/30/97 13327.67 11960.97
3/30/98 15697.18 13720.41
6/30/98 15955.79 13866.18
9/30/98 13085 11895.38
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Int'l Equity -8.34% 6.94% 6.04%
MSCI EAFE -8.34% 3.75% 3.86%
Legend as Follows:
GE In't Equity Fund
GE In't Equity Fund w/load
MSCI EAFE
4
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
GE INTERNATIONAL EQUITY FUND
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Pacific Rim 4.0%
Japan 5.0%
Other Regions 6.6%
Europe 81.0%
Cash & Other 3.4%
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
COMMON STOCK -- 96.2%
- --------------------------------------------------------------------------------
AUSTRALIA -- 1.8%
Brambles Industries Ltd. 29,403 $ 634,676
Coca Cola Amatil Ltd. 24,508 64,609
699,285
AUSTRIA -- 0.4%
VA Technologie AG 1,852 168,027
BRAZIL -- 1.0%
Telecomunicacoes Brasileiras S.A. ADR 3,734 263,014(a)
Uniao de Banco Brasiliero S.A. GDR 9,589 129,451
392,465
CANADA -- 0.3%
Newcourt Credit Group Inc. 5,081 131,567
CROATIA -- 0.2%
Pliva D D GDR (Regd.) 4,967 65,316
FINLAND -- 5.1%
Merita Ltd. (Series A) 71,494 364,185
Nokia Oyj 14,312 1,137,191
Pohjola Group Insurance Ltd. Co.
(Series B) 2,367 93,572
Sampo Insurance Co.
Ltd. (Series A) 14,865 424,213
2,019,161
[GRAPHIC OF FRENCH FLAG OMITTED]
FRANCE -- 19.9%
Alstom 15,475 331,619(a)
AXA-UAP 10,393 952,107
Cap Gemini S.A. 6,439 986,582
Carrefour S.A. 1,073 680,421
Coflexip S.A. ADR 11,643 461,354
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
Elf Aquitaine S.A. ADR 2,942 $ 363,035
Lyonnaise Des Eaux S.A. 3,912 666,461
Michelin CGDE (Regd.) (Class B) 3,875 152,238
Renault S.A. 10,685 427,415
Rhone-Poulenc S.A. (Class A) 10,814 453,818
Schneider S.A. 11,568 603,210
Societe Generale 3,665 405,782
Total S.A. (Class B) 10,548 1,329,849
7,813,891
[GRAPHIC OF GERMAN FLAG OMITTED]
GERMANY -- 12.4%
Bayerische Vereinsbank AG 9,212 678,509
Daimler-Benz AG 6,853 573,699
Fresenius Medical Care AG 8,001 426,413
Mannesmann AG 13,295 1,218,081
Muenchener Rueckversicherungs-
Gesellschaft AG (Regd.) 1,609 710,033
Preussag AG 2,683 927,832
Volkswagen AG 4,679 337,627
4,872,194
GREECE -- 0.6%
Alpha Credit Bank (Regd.) 2,284 169,850
National Bank Greece S.A. GDR 2,141 56,736 (b)
226,586
HONG KONG -- 0.6%
Giordano International Ltd. 238,000 32,250
Johnson Electric Holdings 103,900 197,106
229,356
ISRAEL -- 2.8%
Comverse Technology Inc. 6,494 265,442(a)
ECI Telecommunications Ltd. 20,494 502,103
Teva Pharmaceutical Industries
Ltd. ADR 8,398 318,075
1,085,620
[GRAPHIC OF ITALIAN FLAG OMITTED]
ITALY -- 7.2%
Assicurazioni Generali 12,248 398,460
Banca Intesa S.p.A. 75,474 317,780
Credito Italiano 101,064 421,240
Industrie Natuzzi S.p.A. ADR 3,663 72,344
Montedison S.p.A. 458,306 438,135
Saipem 89,940 381,413
Telecom Italia Mobile S.p.A. 89,749 523,058
Telecom Italia S.p.A. 42,275 291,327
2,843,757
JAPAN -- 5.0%
Canon Inc. 32,000 648,878
Honda Motor Co. 4,000 121,518
Minebea Co. Ltd. 13,000 105,728
NTT Data Corp. 88 320,808
Shin-Etsu Chemical Co. 10,000 158,486
Sony Corp. 8,100 562,710
Sumitomo Realty & Development 26,000 47,583
1,965,711
LUXEMBOURG -- 0.1%
Societe Europeene de
Communicion 2,322 13,628(a,m)
- ----------
See Notes to Schedule of Investments and Financial Statements.
5
<PAGE>
GE INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
MEXICO -- 1.4%
Desc S.A. de C.V. (Series B) 56,045 $ 43,196
Desc S.A. de C.V. ADR (Class C) 7,301 100,389
Gruma S.A. de C.V. (Series B) 31,129 64,103
Grupo Carso S.A. de C.V. ADR 34,431 189,370
Grupo Financiero Bancomer S.A.
ADR (Series C) 42,286 148,001(b)
545,059
[GRAPHIC OF NETHERLANDS FLAG OMITTED]
NETHERLANDS -- 5.9%
IHC Caland N.V. 11,449 534,961
ING Groep N.V. 19,978 900,607
Ispat International N.V. (Regd.)
(Class A) 7,255 54,413
Koninklijke Ahold N.V. 11,917 356,241
Philips Electronics N.V. 8,853 477,118
2,323,340
NORWAY -- 0.1%
Den Norske Bank ASA 16,875 52,948
PANAMA -- 0.6%
Panamerican Beverages Inc.
(Class A) 12,095 215,442
PHILIPPINES -- 0.2%
Metro Bank & Trust Co. 3,440 11,794
San Miguel Corp. S.A. 58,998 76,192
87,986
PORTUGAL -- 1.7%
Banco Comercial Portugues (Regd.) 16,569 447,813
Jeronimo Martins, SGPS S.A. 5,876 199,201
647,014
SOUTH AFRICA -- 0.3%
Barlow Ltd. 21,853 81,794
Iscor Ltd. 86,573 19,442
101,236
SOUTH KOREA -- 0.5%
Hyundai Heavy Industries 9,041 135,217
Pohang Iron & Steel Co. Ltd. 1,967 77,342
Samsung Display Devices Co. 20 137(a,m)
212,696
SPAIN -- 2.7%
Argentaria S.A. 34,828 693,198
Repsol S.A. 9,024 381,471
1,074,669
SWEDEN -- 5.3%
Autoliv Inc. SDR 21,997 676,399
Ericson LM Telephone (Series B) 8,768 165,571
Investor AB (Series B) 1,553 60,238
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
Invik & Co. AB 1,300 $ 93,716
Kinnevik AB (Series B) 2,601 68,364
NetCom Systems AB (Series B) 5,935 199,159
Pharmacia & Upjohn Inc. 16,410 823,577
2,087,024
SWITZERLAND -- 3.5%
ABB AG 368 374,558
Novartis AG (Regd.) 328 527,262
Zurich Allied AG (Regd.) 982 488,723(a)
1,390,543
TAIWAN -- 0.9%
Taiwan Semiconductor Manufacturing Co. 178,450 341,878
[GRAPHIC OF UNITED KINGDOM FLAG OMITTED]
UNITED KINGDOM -- 15.7%
Airtours PLC 129,821 783,515
Bank of Scotland PLC 31,586 301,522
Cable & Wireless Communication PLC 53,617 364,617(a)
Coca-Cola Beverages PLC 63,592 150,726(a)
Commercial Union PLC 20,478 317,335
FKI PLC 105,475 202,629
Granada Group PLC 46,044 579,267
Johnson Matthey PLC 13,822 71,504
LucasVarity PLC 176,017 541,636
Railtrack Group PLC 9,765 281,561
Reed International PLC 35,788 301,782
Royal & Sun Alliance Insurance
Group PLC 71,467 619,655
Saatchi & Saatchi PLC 36,874 65,197
SEMA Group PLC 27,733 274,878
Siebe PLC 286,012 923,873
Somerfield PLC 32,106 227,886
Vodafone Group PLC 12,827 148,943
6,156,526
TOTAL COMMON STOCK
(COST $40,699,354) 37,762,925
- --------------------------------------------------------------------------------
PREFERRED STOCK -- 0.4%
- --------------------------------------------------------------------------------
Fresenius Medical Care AG 1,713 64,624
Telecomunicacoes de
Rio de Janiero S.A. 1,158,781 32,747
Telerj Celular S.A. 2,376,671 49,119(a)
TOTAL PREFERRED STOCK
(Cost $308,069) 146,490
- --------------------------------------------------------------------------------
WARRANTS -- 0.0%
- --------------------------------------------------------------------------------
Muenchener Rueckversicherungs-
Gesellschaft AG, 06/03/02
(Cost $0) 57 2,253(a)
TOTAL INVESTMENTS IN SECURITIES
(Cost $41,007,423) 37,911,668
- ----------
See Notes to Schedule of Investments and Financial Statements.
6
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 0.9%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(Cost $350,294) 350,294 $ 350,294
OTHER ASSETS AND LIABILITIES,
NET 2.5% 971,583
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $39,233,545
================================================================================
- --------------------------------------------------------------------------------
OTHER INFORMATION (unaudited)
- --------------------------------------------------------------------------------
The GE International Equity Fund invested in the following sectors at September
30, 1998:
PERCENTAGE (BASED ON
SECTOR TOTAL NET ASSETS)
- --------------------------------------------------------------------------------
Finance 23.94%
Capital Equipment 22.48%
Consumer Goods 18.61%
Services 17.14%
Energy 7.87%
Multi Industry 3.37%
Materials 3.22%
Cash & Other 3.37%
- --------------------------------------------------------------------------------
100.00%
================================================================================
- ----------
See Notes to Schedule of Investments and Financial Statements.
[graphic of flag omitted]
ICONS REPRESENT THE TOP FIVE COUNTRY WEIGHTINGS IN THE
GE INTERNATIONAL EQUITY FUND AT SEPTEMBER 30, 1998.
7
<PAGE>
GE GLOBAL EQUITY FUND
======================================================================
TOP TEN LARGEST HOLDINGS
AT SEPTEMBER 30, 1998
======================================================================
Airtouch Communications Inc. 3.29%
- ----------------------------------------------------------------------------
Mannesmann AG 2.66%
- ----------------------------------------------------------------------------
Cardinal Health Inc. 2.56%
- ----------------------------------------------------------------------------
Nokia AB Oy (Series A) 2.32%
- ----------------------------------------------------------------------------
Total S.A. (Class B) 2.30%
- ----------------------------------------------------------------------------
AlliedSignal Inc. 2.18%
- ----------------------------------------------------------------------------
AXA-UAP 2.16%
- ----------------------------------------------------------------------------
ING Groep N.V. 2.06%
- ----------------------------------------------------------------------------
Siebe PLC 1.98%
- ----------------------------------------------------------------------------
Preussag AG 1.83%
- ----------------------------------------------------------------------------
INVESTMENT PROFILE
A mutual fund designed for investors who seek long-term growth of capital by
investing primarily in equity securities of global companies.
* LIPPER PERFORMANCE COMPARISON
Global Stock Peer Group
Based on average annual total returns for the period ended 9/30/98
One Three Five
Year Year Year
Number of funds in peer group: 233 159 76
Peer group
average
total return: -9.10% 8.06% 9.45%
Lipper categories
in peer group: Global, Global Small Cap
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- ----------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A
W/O LOAD W/LOAD MSCI
1/1/94 10000 10000 10000
MAR-94 9989.33 9414.94 10060.53
6/30/94 9872.06 9304.42 10362.27
SEP-94 10309.17 9716.39 10584.52
12/31/94 9771.67 9209.8 10507.72
MAR-95 9979.69 9405.86 10999.19
6/30/95 10795.37 10174.64 11468.06
SEP-95 11047.19 10411.98 12108.59
12/31/95 11099.2 10461 12694.07
3/30/96 11651.65 10981.68 13200.83
6/30/96 12081.33 11386.65 13583.25
SEP-96 12282.23 11576 13763.66
DEC-96 12740.03 12007.48 14394.25
MAR-97 12698.64 11968.47 14434.91
JUN-97 14248.27 13428.99 16607.57
SEP-97 14555.83 13718.87 17082.59
DEC-97 13601 12818.94 16662.35
MAR-98 15777.16 14869.97 19048.44
JUN-98 15962.93 15045.06 19435.56
SEP-98 12951 12209 17105.81
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Global Equity -11.03% 5.44% 5.60%
GE Global Equity w/load -16.14% 3.38% 4.29%
(maximum load-5.75%)
MSCI World 0.14% 12.21% 11.97%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
W/O LOAD W/LOAD MSCI
12/22/93 10000 10000 10000
DEC-93 10263.26 10263.26 10000
MAR-94 10257.78 10257.78 10060.53
6/30/94 10137.42 10137.42 10362.27
SEP-94 10569.61 10569.61 10584.52
12/31/94 10004.78 10004.78 10507.72
MAR-95 10206.22 10206.22 10999.19
6/30/95 11023.16 11023.16 11468.06
SEP-95 11269.36 11269.36 12108.59
12/31/95 11307.77 11307.77 12694.07
3/30/96 11860.62 11860.62 13200.83
6/30/96 12276.68 12276.68 13583.25
SEP-96 12464.76 12264.76 13763.66
DEC-96 12915.25 12915.25 14394.25
MAR-97 12854.81 12854.81 14434.91
JUN-97 14408.02 14408.02 16607.57
SEP-97 14698.12 14598.12 17082.59
DEC-97 13722.68 13722.68 16662.35
MAR-98 15895.5 15895.5 19048.44
JUN-98 16065.25 16065.25 19435.56
SEP-98 13017 13017 17105.81
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Global Equity -11.44% 4.92% 5.68%
GE Global Equity w/load -14.59% 4.34% 5.68%
maximum load 4.0% 2.0% 0.0%
MSCI World 0.14% 12.21% 11.97%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS C
W/O LOAD MSCI
2/22/93 10000 10000
MAR-93 10405.58 10578.82
JUN-93 10585.11 11218.33
SEP-93 11409.58 11744.47
DEC-93 12608.53 11934.23
MAR-94 12615.25 12006.47
JUN-94 12480.83 12366.58
SEP-94 13038.67 12631.81
DEC-94 12370.65 12540.16
MAR-95 12646.61 13126.68
JUN-95 13681.53 13686.25
SEP-95 14012.7 14450.67
DEC-95 14087.43 15137.47
MAR-96 14798.5 15754.18
JUN-96 15347.65 16210.57
SEP-96 15615.16 16425.88
DEC-96 16212.54 17178.44
MAR-97 16167.68 17226.95
JUN-97 18149.38 19819.86
SEP-97 18553.2 20386.76
DEC-97 17335.72 19885.24
MAR-98 20128.56 22732.85
JUN-98 20371.78 23194.84
SEP-98 16539 20414.47
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Global Equity -10.86% 7.71% 9.39%
MSCI World 0.14% 11.69% 13.58%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS D
W/O LOAD MSCI
11/29/93 10000 10000
DEC-93 10855.63 10486.97
MAR-94 10861.41 10550.45
JUN-94 10757.37 10866.89
SEP-94 11242.92 11099.95
DEC-94 10670.15 11019.42
MAR-95 10919.95 11534.82
JUN-95 11824 12026.53
SEP-95 12115.44 12698.25
DEC-95 12184.04 13301.75
MAR-96 12810.58 13843.68
JUN-96 13297.2 14244.72
SEP-96 13534.42 14433.92
DEC-96 14059.67 15095.22
MAR-97 14027.2 15137.85
JUN-97 15761.11 17416.31
SEP-97 16124.78 17914.47
DEC-97 15089.2 17473.77
MAR-98 17523.65 19976.05
JUN-98 17750.28 20382.02
SEP-98 14417 17938.82
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Global Equity -10.59% 5.97% 7.85%
MSCI World 0.14% 12.21% 12.84%
Legend as Follows:
GE Global Equity Fund
GE Global Equity Fund w/load
MSCI World
8
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
GE GLOBAL EQUITY FUND
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Pacific Rim 2.2%
Japan 4.1%
Other Regions 5.0%
Europe 58.5%
Cash & Other 9.7%
United States 20.5%
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
COMMON STOCK -- 89.8%
- --------------------------------------------------------------------------------
AUSTRALIA -- 0.2%
Coca Cola Amatil Ltd. 30,966 $ 81,634
AUSTRIA -- 0.5%
VA Technologie AG 2,778 252,040
BRAZIL -- 1.1%
Telecomunicacoes Brasileiras S.A
ADR 5,396 380,081(a)
Uniao de Banco Brasiliero
S.A. GDR 8,160 110,160
490,241
CROATIA -- 0.3%
Pliva D D GDR (Regd.) 10,472 137,707
[GRAPHIC OF FINLAND FLAG OMITTED]
FINLAND -- 4.8%
Helsingin Puhelin Oyj 3,341 149,818
Merita Ltd. (Series A) 67,952 346,142
Nokia AB Oy (Series A) 13,417 1,066,077
Sampo Insurance Co. Ltd. (Series A) 23,093 659,021
2,221,058
[GRAPHIC OF FRENCH FLAG OMITTED]
FRANCE -- 13.2%
Alstom 7,475 160,184(a)
AXA-UAP 10,822 991,408
Cap Gemini S.A 4,494 688,569
Carrefour S.A 864 547,888
Coflexip S.A. ADR 13,053 517,225
Elf Aquitaine S.A. ADR 2,007 247,658
Lyonnaise Des Eaux S.A 1,662 283,144
Renault S.A 7,463 298,531
Rhone-Poulenc S.A. (Class A) 9,612 403,375
Schneider S.A 10,696 557,740
Societe Generale 2,836 313,997
Total S.A. (Class B) 8,359 1,053,869
6,063,588
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
[GRAPHIC OF GERMAN FLAG OMITTED]
GERMANY -- 9.0%
Bayerische Vereinsbank AG 7,093 $ 522,434
Daimler-Benz AG 5,405 452,480
Fresenius Medical Care AG 8,875 472,993
Mannesmann AG 13,297 1,218,265
Muenchener Rueckversicherungs -
Gesellschaft AG (Regd.) 1,216 536,603
Preussag AG 2,428 839,648
Volkswagen AG 1,431 103,258
4,145,681
GREECE -- 0.2%
Alpha Credit Bank (Regd.) 305 22,681
National Bank Greece S.A. GDR 2,500 66,261 (b)
88,942
HONG KONG -- 0.6%
Giordano International Ltd. 394,000 53,389
Johnson Electric Holdings 109,000 206,780
260,169
ISRAEL -- 1.9%
Comverse Technology Inc. 7,118 290,948(a)
ECI Telecommunications Ltd. 15,058 368,921
Teva Pharmaceutical Industries
Ltd. ADR 5,652 214,070
873,939
ITALY -- 4.2%
Assicurazioni Generali 6,333 206,029
Credito Italiano 78,492 327,159
Industrie Natuzzi S.p.A ADR 18,295 361,326
Montedison S.p.A 212,954 203,581
Saipem 72,407 307,060
Telecom Italia Mobile S.p.A 73,512 428,429
Telecom Italia S.p.A 12,155 83,763
1,917,347
JAPAN -- 4.1%
Canon Inc. 23,000 466,381
Honda Motor Co. 6,000 182,277
Minebea Co. Ltd. 14,000 113,861
NTT Data Corp. 100 364,555
Shin-Etsu Chemical Co. 11,000 174,335
Sony Corp. 8,300 576,604
1,878,013
MEXICO -- 1.2%
Desc S.A. de C.V. (Series B) 62,185 47,929
Desc S.A. de C.V. ADR (Class C) 6,339 87,161
Gruma S.A. de C.V. (Series B) 31,745 65,370
Grupo Carso S.A. de C.V. (Series A) 25,083 70,345
Grupo Carso S.A. de C.V. ADR 23,882 131,351
Grupo Financiero Bancomer S.A
ADR (Series C) 36,550 127,925(b)
530,081
- ----------
See Notes to Schedule of Investments and Financial Statements.
9
<PAGE>
GE GLOBAL EQUITY FUND
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
NETHERLANDS -- 4.5%
IHC Caland N.V 9,733 $ 454,777
ING Groep N.V 20,995 946,445
Ispat International N.V. (Regd.)
(Class A) 21,541 161,558(a)
Koninklijke Ahold N.V 7,007 209,464
Philips Electronics N.V 5,186 279,491(a)
2,051,735
NORWAY -- 0.2%
Petroleum Geo Services 6,558 107,319
PANAMA -- 0.6%
Banco Latinoamericano de
Exportaciones S.A. (Class E) 7 112
Panamerican Beverages Inc.
(Class A) 14,338 255,396
255,508
PHILIPPINES -- 0.2%
Metro Bank & Trust Co. 1,300 4,457
San Miguel Corp. S.A 73,780 95,282
99,739
PORTUGAL -- 2.0%
Banco Comercial Portugues (Regd.) 12,549 339,164
Jeronimo Martins, SGPS S.A 9,229 312,871
Telecel-Comunicacoes Pessoais S.A 1,914 247,573
899,608
SOUTH KOREA -- 0.3%
Hyundai Heavy Industries 3,211 48,023
Pohang Iron & Steel Co. Ltd. 2,560 100,659
148,682
SPAIN -- 2.5%
Argentaria S.A 26,184 521,153
Repsol S.A 14,463 611,392
1,132,545
SWEDEN -- 3.7%
Autoliv Inc. SDR 23,156 712,038
Ericson LM Telephone (Series B) 15,215 287,313
Pharmacia & Upjohn Inc. 13,934 699,313
1,698,664
SWITZERLAND -- 2.0%
ABB AG 322 327,738
Novartis AG (Regd.) 315 506,364
Zurich Allied AG (Regd.) 208 103,518(a)
937,620
TAIWAN -- 0.9%
Taiwan Semiconductor
Manufacturing Co. 207,900 398,299
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
[GRAPHIC OF UNITED KINGDOM FLAG OMITTED]
UNITED KINGDOM -- 11.1%
Airtours PLC 54,041 $ 326,156
Bank of Scotland PLC 5,250 50,117
Cable & Wireless Communication
PLC 21,032 143,026(a)
Coca-Cola Beverages PLC 55,719 132,065(a)
Commercial Union PLC 13,881 215,106
FKI PLC 64,598 124,100
Granada Group PLC 29,581 372,151
Johnson Matthey PLC 65,107 336,814
LucasVarity PLC 202,502 623,135
Railtrack Group PLC 4,871 140,449
Reed International PLC 25,505 215,071
Royal & Sun Alliance Insurance
Group PLC 57,897 501,996
SEMA Group PLC 9,364 92,812
Senior Engineering PLC 60,230 122,876
Siebe PLC 280,936 907,476
Somerfield PLC 29,998 212,923
United Assurance Group 59,639 593,144
5,109,417
[GRAPHIC OF U.S. FLAG OMITTED]
UNITED STATES -- 20.5%
Airtouch Communications Inc. 26,490 1,509,930(a)
AlliedSignal Inc. 28,254 999,485
Cardinal Health Inc. 11,368 1,173,746
Citicorp 5,116 475,468
Ecolab Inc. 11,671 331,894
EMC Corp. 13,433 768,200(a)
First Data Corp. 1 24
Harman International Industries Inc. 15,212 558,090
Intel Corp. 4,429 379,787
International Business Machines 3,303 422,784
MCI WorldCom Inc. 5,679 277,561(a)
Morgan Stanley, Dean Witter 6,691 288,131
Northern Telecom Ltd. 3,243 104,984
SBC Communications Inc. 8,727 387,806
Sears Roebuck & Co. 10,915 482,307
Sun Microsystems Inc. 3,522 175,440(a)
Travelers Group Inc. 11,441 429,037
Xerox Corp. 2,819 238,910
Zebra Technologies Corp. (Class A) 12,388 414,998(a)
9,418,582
TOTAL COMMON STOCK
(COST $41,343,034) 41,198,158
- --------------------------------------------------------------------------------
PREFERRED STOCK -- 0.5%
- --------------------------------------------------------------------------------
Fresenius Medical Care AG 3,217 121,363
Telecomunicacoes de
Rio de Janiero S.A 1,191,797 33,679
Telerj Celular S.A 2,653,597 54,843(a)
TOTAL PREFERRED STOCK
(COST $504,654) 209,885
- --------------------------------------------------------------------------------
WARRANTS -- 0.0%
- --------------------------------------------------------------------------------
Muenchener Rueckversicherungs
-Gesellschaft AG, 06/03/02
(COST $0) 46 1,818(a)
TOTAL INVESTMENTS IN SECURITIES
(COST $41,847,688) 41,409,861
- ----------
See Notes to Schedule of Investments and Financial Statements.
10
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 7.7%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $3,546,544) 3,546,544 $ 3,546,544
OTHER ASSETS AND LIABILITIES,
NET 2.0% 898,720
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $45,855,125
================================================================================
- --------------------------------------------------------------------------------
OTHER INFORMATION (unaudited)
- --------------------------------------------------------------------------------
The GE Global Equity Fund invested in the following sectors at September 30,
1998:
PERCENTAGE (BASED ON
SECTOR TOTAL NET ASSETS)
- --------------------------------------------------------------------------------
Capital Equipment 23.64%
Services 19.00%
Finances 18.97%
Consumer Goods 14.84%
Energy 6.66%
Multi Industry 4.75%
Materials 2.45%
Cash & Other 9.69%
- --------------------------------------------------------------------------------
100.00%
================================================================================
[GRAPHIC OF FLAG OMITTED]
ICONS REPRESENT THE TOP FIVE COUNTRY WEIGHTINGS IN THE
GE GLOBAL EQUITY FUND AT SEPTEMBER 30, 1998.
- ----------
See Notes to Schedule of Investments and Financial Statements.
11
<PAGE>
GE PREMIER GROWTH EQUITY FUND
Q & A
David Carlson manages pension and mutual fund portfolios with total assets of
nearly $6 billion. Dave joined GE in 1980 on the GE Financial Management
Program. In 1982, he joined GE Investments as a Security Analyst responsible for
several consumer industries. In 1988, Dave assumed responsibility for managing
Elfun Trusts. He is a Trustee for the GE Canada Pension Trust, a Chartered
Financial Analyst (CFA) and a member of the New York Society of Security
Analysts. Dave is a graduate of Indiana University with a B.S. in Business.
Q. HOW DID THE GE PREMIER GROWTH EQUITY FUND'S BENCHMARK AND LIPPER PEER GROUP
PERFORM FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. For the one year period ending September 30, the Standard & Poor's 500
Composite Index, advanced 9.12%. Our Lipper peer group of 934 Growth funds
fell 1.44%. To see how your class of shares of GE Premier Growth Equity Fund
performed compared to its benchmarks, please refer to the next page.
Q. WHAT FACTORS AFFECTED THE FUND'S PERFORMANCE?
A. This concentrated portfolio currently holds just 34 stocks. During the year,
a handful of the fund's stocks had sizeable gains, which is why it compared
favorably with the results of the much broader S&P 500 Index. The fund was
overweighted in technology and healthcare, stock sectors that did well during
the twelve month period. In technology, Cisco Systems was up 90% and
Microsoft rose 66%. The Fund also had several strong performers among
communication stocks. NTL, a cable television programmer based in the United
Kingdom, advanced 80%. Cable television services provider Tele-Communications
Inc. Liberty Media Group was up 84%. Airtouch Communications, a cellular
telephone provider, rose 61%. In the retail group, CVS and Home Depot both
had returns of over 50%. Two stock sectors had weak results over the period:
oil services, because of the mild winter and the continuing uncertainty in
Asia, and financials, which were affected by global economic turmoil in the
third quarter.
Q. WHAT CHANGES WERE MADE IN THE FUND?
A. As the fund's name indicates, we look for industry leaders and good-quality
companies that generate long-term capital gains. Following our strategy, we
are not changing our holdings but are adding to or subtracting from the
amount of shares we hold. We added Avon Products, the beauty care retailer,
to the portfolio in August.
Q. WHAT IS YOUR OUTLOOK FOR THE FUND?
A. This is a period of earnings uncertainty. We continue to focus on companies
that we believe to have the strength to grow earnings regardless of the
economic environment. Cash currently constitutes 8% of our portfolio. Should
the market decline further from current levels, we will put that cash to
work.
[Picture of David Carlson Omitted]
12
<PAGE>
GE PREMIER GROWTH EQUITY FUND
======================================================================
TOP TEN LARGEST HOLDINGS
AT SEPTEMBER 30, 1998
======================================================================
Tele-Communications Inc.
Liberty Media Group (Series A) 3.65%
- --------------------------------------------------------------------------------
Cardinal Health Inc. 3.56%
- --------------------------------------------------------------------------------
Cisco Systems Inc. 3.52%
- --------------------------------------------------------------------------------
Microsoft Corp. 3.50%
- --------------------------------------------------------------------------------
Airtouch Communications Inc. 3.35%
- --------------------------------------------------------------------------------
Catalina Marketing Corp. 3.33%
- --------------------------------------------------------------------------------
Automatic Data Processing Inc. 3.25%
- --------------------------------------------------------------------------------
Waste Management Inc. 3.25%
- --------------------------------------------------------------------------------
Carnival Corp. (Class A) 3.19%
- --------------------------------------------------------------------------------
Tenet Healthcare Corp. 3.18%
- --------------------------------------------------------------------------------
INVESTMENT PROFILE
A mutual fund designed for investors who seek long-term growth of capital and
future income by primarily investing in growth-oriented equity securities.
* LIPPER PERFORMANCE COMPARISON
Growth Peer Group
Based on average annual total returns
for the period ended
9/30/98
One
Year
Number of Funds
in peer group: 934
Peer group
average annual
total return: -1.44%
Lipper categories
in peer group: Growth
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- --------------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A
W/O LOAD W/LOAD S&P 500
12/31/96 10000 10000 10000
3/97 9526.66 8978.88 10260.73
6/97 11013.32 10380.06 12053.8
9/97 12206.66 11504.77 12960.26
12/97 12612.02 11886.83 13329.4
3/98 14244.41 13425.35 15190.35
6/98 14799.82 13948.83 15693.88
9/98 13804.14 13010.4 14141.85
AVERAGE ANNUAL
TOTAL RETURN
ONE SINCE
YEAR INCEPTION
GE Premier Growth Equity 13.09% 20.25%
GE Premier Growth Equity w/load 6.57% 16.23%
(maximum load-5.75%)
S&P 500 9.12% 21.93%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
W/O LOAD W/LOAD S&P 500
12/31/96 10000 10000 10000
3/97 9513.33 9513.33 10260.73
6/97 10986.67 10986.67 12053.8
9/97 12166.67 11766.67 12960.26
12/97 12552.07 12552.07 13329.4
3/98 14157.49 14157.49 15190.35
6/98 14692.63 14392.63 15693.88
9/98 13683.31 13383.31 14141.85
AVERAGE ANNUAL
TOTAL RETURN
ONE SINCE
YEAR INCEPTION
GE Premier Growth Equity 12.47% 19.65%
GE Premier Growth Equity w/load 8.47% 18.14%
maximum load 4.0% 3.0%
S&P 500 9.12% 21.93%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS C
W/O LOAD S&P 500
12/31/96 10000 10000
3/97 9533.32 10260.73
6/97 11033.32 12053.8
9/97 12233.32 12960.26
12/97 12645.51 13329.4
3/98 14294.04 15190.35
6/98 14863.91 15693.88
9/98 13866.65 14141.85
AVERAGE ANNUAL
TOTAL RETURN
ONE SINCE
YEAR INCEPTION
GE Premier Growth Equity 13.35% 20.57%
S&P 500 9.12% 21.93%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS D
W/O LOAD S&P 500
12/31/96 10000 10000
3/97 9539.99 10260.73
6/97 11039.99 12053.8
9/97 12253.32 12960.26
12/97 12676.35 13329.4
3/98 14333.92 15190.35
6/98 14918.15 15693.88
9/98 13926.32 14141.85
AVERAGE ANNUAL
TOTAL RETURN
ONE SINCE
YEAR INCEPTION
GE Premier Growth Equity 13.65% 20.86%
S&P 500 9.12% 21.93%
Legend as Follows:
GE Premier Fund
GE Premier Fund w/load
S&P 500
13
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
GE PREMIER GROWTH EQUITY FUND
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Financials 3.4%
Energy 4.7%
Retail Trade 5.1%
Technology--Electronics & Services 6.1%
Utility 6.4%
Cash & Other 7.9%
Capital Goods 10.5%
Technology--Software & Services 15.7%
Consumer - Cyclical 18.5%
Healthcare 19.9%
Consumer - Stable 1.8%
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
COMMON STOCK -- 92.1%
- --------------------------------------------------------------------------------
[GRAPHIC OF FACTORY OMITTED]
CAPITAL GOODS -- 10.5%
AlliedSignal Inc. 13,806 $ 488,387
Dover Corp. 29,737 918,130
Molex Inc. (Class A) 29,843 809,492(h)
Waste Management Inc. 20,789 999,171
3,215,180
[GRAPHIC OF PRODUCTS OMITTED]
CONSUMER - CYCLICAL -- 18.5%
Carnival Corp. (Class A) 30,799 979,793
Catalina Marketing Corp. 21,771 1,023,237(a)
Comcast UK Cable Partners Ltd.
(Class A) 31,436 487,258(a)
Interpublic Group Cos. Inc. 16,461 887,865
NTL Inc. 20,124 865,332(a)
Tele-Communications Inc. Liberty
Media Group (Series A) 30,586 1,122,124(a)
Walt Disney Co. 12,744 322,583
5,688,192
CONSUMER - STABLE -- 1.8%
Avon Products Inc. 20,178 566,245
ENERGY -- 4.7%
Baker Hughes Inc. 33,985 711,561
Schlumberger Ltd. 14,868 748,046
1,459,607
FINANCIAL -- 3.4%
Citicorp 5,523 513,294
Travelers Group Inc. 14,125 529,687
1,042,981
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
[GRAPHIC OF HEALTH SIGN OMITTED]
HEALTHCARE -- 19.9%
Cardinal Health Inc. 10,619 $1,096,412
Dentsply International Inc. 26,657 596,450(h)
Johnson & Johnson 11,788 922,411
Lincare Holdings Inc. 19,116 740,745(a)
Omnicare Inc. 26,550 935,887
Sybron International Corp. 44,605 853,071(a)
Tenet Healthcare Corp. 33,985 977,069(a)
6,122,045
RETAIL TRADE -- 5.1%
CVS Corp. 13,806 604,875
Home Depot Inc. 24,002 948,079
1,552,954
TECHNOLOGY - ELECTRONICS & EQUIPMENT -- 6.1%
Cisco Systems Inc. 17,523 1,083,141(a)
Intel Corp. 9,240 792,330
1,875,471
[GRAPHIC OF DISCS OMITTED]
TECHNOLOGY - SOFTWARE & SERVICES -- 15.7%
Automatic Data Processing Inc. 13,381 1,000,230
EMC Corp. 16,992 971,730(a)
Equifax Inc. 26,338 939,937
First Data Corp. 36,109 848,561(h)
Microsoft Corp. 9,771 1,075,421(a)
4,835,879
[GRAPHIC OF PLUG OMITTED]
UTILITIES -- 6.4%
Airtouch Communications Inc. 18,054 1,029,078(a,h)
MCI WorldCom Inc. 19,116 934,295(a)
1,963,373
TOTAL INVESTMENTS IN SECURITIES
(COST $25,116,770) 28,321,927
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 8.2%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $2,533,560) 2,533,560 2,533,560
OTHER ASSETS AND LIABILITIES,
NET (0.3)% (95,686)
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $30,759,801
================================================================================
- --------------------------------------------------------------------------------
OTHER INFORMATION
- --------------------------------------------------------------------------------
The GE Premier Growth Equity Fund had the following long Futures Contracts open
at September 30, 1998:
NUMBER
EXPIRATION OF UNDERLYING UNREALIZED
DESCRIPTION DATE CONTRACTS FACE VALUE LOSS
- --------------------------------------------------------------------------------
S&P 500 December 1998 2 $ 513,000 $ (8,813)
[GRAPHIC OMITTED]
ICONS REPRESENT THE TOP FIVE INDUSTRY WEIGHTINGS IN THE
GE PREMIER GROWTH EQUITY FUND AT SEPTEMBER 30, 1998.
- ----------
See Notes to Schedule of Investments and Financial Statements.
14
<PAGE>
GE U.S. EQUITY FUND
Q & A
Gene Bolton is responsible for the overall management of the U.S. equity
operations at GE Investments with total assets of over $26 billion. His
responsibilities include overseeing the portfolio management team of the GE U.S.
Equity Fund. Gene joined GE in 1964. After completing GE's Financial Management
Program he held a number of financial and strategic planning positions in the
U.S. and Europe. Joining GE Investments in 1984 as Chief Financial Officer, he
moved to equities as a Portfolio Manager in 1986 and was named to his present
position in 1991. Gene is a Trustee of the GE Pension Trust and GE's employee
savings program, as well as Chairman of the Asset Allocation Committee of GE
Investments. He also serves as a Trustee of the Investment Management Workshop,
sponsored by the Association for Investment Management and Research. Gene is a
graduate of Mundelein College with a B.A. in Business Management.
Q. HOW DID THE GE U.S. EQUITY FUND'S INDUSTRY BENCHMARK AND LIPPER PEER GROUP
PERFORM FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. The Standard & Poor's 500 Composite Index posted a 9.12% return for the year
ended September 30, 1998. The fund's Lipper peer group of 800 Growth and
Income funds was down .06% for the same period. To see how your class of GE
U.S. Equity Fund shares performed compared to the aforementioned benchmarks,
please refer to the following page.
Q. WHAT FACTORS CONTRIBUTED TO THE FUND'S PERFORMANCE?
A. The fund is overweighted in healthcare stocks which performed well over this
period as their earnings are less affected by market cycles. On the downside,
the fund was underweighted in technology stocks and utilities, two sectors
that performed well during the third quarter. Fast-growing technology
companies may be well run but many have high valuation levels that our
valuation discipline doesn't allow us to own. Utilities are a favorite with
investors when the stock market slows but we don't believe they will show
much long-term earnings growth.
Q. WHICH INVESTMENTS STAND OUT?
A. Many noteworthy performers for the year were in the healthcare sector:
Cardinal Health (+45%), a new addition to the fund; Allergan (+63%); Watson
Pharmaceuticals (+73%); Abbott Laboratories (+36%); and Johnson & Johnson
(+35%). Investors see them as companies which can grow earnings even in a
slowing global economy.
Q. PLEASE COMMENT ON ANY CHANGES YOU MADE IN THE PORTFOLIO.
A. The fund increased its holdings in healthcare, beverages and utilities, all
of which can show earnings growth in an economic slowdown. We reduced our
position in energy stocks, which were battered by the warm winter and slower
Asian demand. Financial stocks, hit hard by the worldwide economic crisis,
and overvalued technology stocks, were also reduced.
Q. WHAT IS YOUR OUTLOOK FOR THE FUND?
A. We expect market volatility to continue over the next six months. Corporate
earnings, especially those of multi-nationals, are under pressure because of
the ongoing instability in Asia, Russia and Latin America. Balancing that is
the weaker dollar, which should help the earnings of companies that do
business abroad. We watch stock valuations closely. Overvalued stocks get
hurt in volatile markets such as the one we are in now. However, stocks with
strong fundamentals and attractive valuations should be positioned to perform
well when this correction is over.
[picture of Gene Bolton Omitted]
15
<PAGE>
GE U.S. EQUITY FUND
======================================================================
TOP TEN LARGEST HOLDINGS
AT SEPTEMBER 30, 1998
======================================================================
Merck & Co. Inc. 2.40%
- --------------------------------------------------------------------------------
Federal National Mortgage Assoc 2.31%
- --------------------------------------------------------------------------------
Bristol-Myers Squibb Co. 2.12%
- --------------------------------------------------------------------------------
International Business Machines 2.04%
- --------------------------------------------------------------------------------
AlliedSignal Inc. 1.88%
- --------------------------------------------------------------------------------
Johnson & Johnson 1.79%
- --------------------------------------------------------------------------------
Exxon Corp. 1.79%
- --------------------------------------------------------------------------------
Cardinal Health Inc. 1.58%
- --------------------------------------------------------------------------------
Abbott Laboratories 1.58%
- --------------------------------------------------------------------------------
Airtouch Communications Inc. 1.52%
- --------------------------------------------------------------------------------
INVESTMENT PROFILE
A mutual fund designed for investors who seek long-term growth of capital by
primarily investing in a diversified portfolio of Growth and Value stocks of
U.S. companies.
* LIPPER PERFORMANCE COMPARISON
Growth and Income Peer Group
Based on average annual total returns
for the periods ended 9/30/98
One Three Five
Year Year Year
Number of
funds in
peer group: 800 498 326
Peer group
average
total return: -0.06% 17.16% 15.58%
Lipper categories
in peer group: Growth & Income, S&P 500 Index
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- ----------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A W/O LOAD W/LOAD S&P
1/1/94 10000 10000 10000
3/94 9526.45 8978.68 9618.15
6/94 9544.89 8996.06 9657.88
9/94 9913.9 9343.85 10132.9
12/94 9765.97 9204.43 10129.82
3/95 10668.97 10055.5 11116.13
6/95 11677.1 11005.67 12175.41
9/95 12542.98 11821.76 13145.54
12/95 13192.46 12433.89 13927.96
3/96 14032.09 13225.25 14685.15
6/96 14528.24 13692.87 15348.14
9/96 14846.29 13992.63 15818.4
12/96 16100.78 15174.99 17147.09
3/97 16424.34 15479.94 17594.16
6/97 19104.28 18005.78 20668.76
9/97 20700.99 19510.69 22223.07
12/97 21234.7 20013.7 22856.04
3/98 23721.99 22357.98 26047.04
6/98 24285.88 22889.45 26910.44
9/98 21814 20562 24249.15
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE U.S. Equity 5.38% 20.26% 17.85%
GE U.S. Equity w/load -0.70% 17.90% 16.40%
(maximum load-5.75%)
S&P 500 9.12% 22.64% 20.50%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
W/O LOAD W/LOAD S&P
12/22/93 10000 10000 10000
12/93 10133.91 10133.91 10000
3/94 9647.78 9647.78 9618.15
6/30/94 9641.56 9641.56 9657.88
9/94 9990.57 9990.57 10132.9
12/31/94 9835.35 9835.35 10129.82
3/95 10728.9 10728.9 11116.13
6/30/95 11724.56 11724.56 12175.41
9/95 12579.81 12579.81 13145.54
12/31/95 13215.1 13215.1 13927.96
3/30/96 14022.58 14022.58 14685.15
6/30/96 14514.95 14514.95 15348.14
9/96 14816.93 14816.93 15818.4
12/96 16040.71 16040.71 17147.09
3/97 16345.27 16345.27 17594.16
6/97 18992.14 18992.14 20668.76
9/97 20558.5 20458.5 22223.07
12/97 21052.75 21052.75 22856.04
3/98 23492.61 23492.61 26047.04
6/98 24025.09 24025.09 26910.44
9/98 21545 21545 24249.15
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE U.S. Equity 4.80% 19.64% 17.44%
GE U.S. Equity w/load 0.98% 19.18% 17.44%
maximum load 4.0% 2.0% 0.0%
S&P 500 9.12% 22.64% 20.50%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS C
W/O LOAD S&P
2/22/93 10000 10000
10519.58 10216.1
10681.52 10268.05
9/93 11032.38 10530.86
11218.84 10775.93
10701.37 10364.46
10715.17 10407.27
9/94 11129.16 10919.15
10973.84 10915.83
11991.38 11978.67
13136.11 13120.14
9/95 14118.31 14165.55
14865.82 15008.68
15797.66 15824.63
16387.34 16539.05
9/96 16758.61 17045.81
12/96 18180.62 18477.59
3/97 18560.23 18959.35
6/97 21597.06 22272.51
9/97 23422.39 23947.44
12/97 24036.96 24629.52
3/98 26873.73 28068.12
6/98 27522.89 28998.52
9/98 24739 26130.73
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE U.S. Equity 5.62% 17.53% 17.54%
S&P 500 9.12% 19.93% 18.69%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS D
11/29/93 10000 10000
12/93 10158.53 10123.4
3/94 9696.21 9736.84
6/94 9714.95 9777.06
9/94 10096.06 10257.94
12/94 9964.02 10254.82
3/95 10889.12 11253.31
6/95 11936.28 12325.65
9/95 12835.67 13307.76
12/95 13520.19 14099.83
3/96 14388.82 14866.37
6/96 14925.9 15537.53
9/96 15270.71 16013.6
12/96 16582.64 17358.68
3/97 16937.04 17811.27
6/97 19720.5 20923.81
9/97 21403.88 22497.3
12/97 21972.52 23138.08
3/98 24582.47 26368.45
6/98 25194.18 27242.51
9/98 22658 24548.38
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE U.S. Equity 5.86% 20.86% 18.42%
S&P 500 9.12% 22.64% 20.40%
Legend as Follows:
GE U.S. Equity Fund
GE U.S. Equity Fund w/load
S&P 500
16
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
GE U.S. EQUITY FUND
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Transportation 2.2%
Cash & Other 2.7%
Retail Trade 4.5%
Insurance 5.5%
Utilities 9.0%
Capital Goods 10.3%
Financials 10.8%
Energy & Basic Materials 11.5%
Technology 12.4%
Healthcare 15.2%
Consumer 15.9%
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
COMMON STOCK -- 96.7%
- --------------------------------------------------------------------------------
BASIC MATERIALS -- 2.8%
Air Products & Chemicals Inc. 37,719 $ 1,122,140
Airgas Inc. 36,347 440,707(a)
Avery Dennison Corp. 10,132 442,642
Barrick Gold Corp. 31,612 632,240
Champion International Corp. 7,903 247,463
Delta & Pine Land Co. 14,739 648,516
Du Pont de Nemours (E.I.) & Co. 75,069 4,213,248
FMC Corp. 1,971 101,630(a)
Fort James Corp. 4,606 151,134
Great Lakes Chemical Corp. 13,357 519,253
IMC Global Inc. 5,987 115,998
Mead Corp. 30,028 883,949
Morton International Inc. 68,227 1,492,466
Newmont Mining Corp. 84,050 2,038,213
Rayonier Inc. 22,503 877,617
Union Camp Corp. 4,937 194,394
Weyerhaeuser Co. 11,458 483,384
14,604,994
[GRAPHIC OF FACTORY OMITTED]
CAPITAL GOODS -- 10.3%
AlliedSignal Inc. 272,230 9,630,136(h)
Cooper Industries Inc. 27,633 1,126,045
Deere & Co. 42,370 1,281,693
Dover Corp. 247,275 7,634,616(h)
Emerson Electric Co. 90,666 5,643,959
Hubbell Inc. (Class B) 120,628 4,282,294
Lockheed Martin Corp. 19,942 2,010,403
Mannesmann AG 3,455 316,545
Martin Marietta Materials Inc. 65,416 2,825,154
Masco Corp. 43,197 1,063,726
Minnesota Mining &
Manufacturing Co. 1,612 118,784
Molex Inc. (Class A) 57,688 1,564,787
National Service Industries Inc. 12,526 399,266
Parker Hannifin Corp. 14,738 437,534
Safety-Kleen Corp. 48,993 162,289(a)
Sherwin-Williams Co. 52,870 1,143,314
Tenneco Inc. 9,672 317,967
Textron Inc. 82,495 5,001,259
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
Timken Co. 11,054 $ 167,192
Tyco International Ltd. 14,498 801,015
United Technologies Corp. 29,674 2,268,206
Waste Management Inc. 93,623 4,499,755
52,695,939
CONSUMER - CYCLICAL -- 8.3%
ACNielsen Corp. 36,983 822,872(a)
Carnival Corp. (Class A) 34,541 1,098,836
Catalina Marketing Corp. 27,146 1,275,862(a)
Cendant Corp. 13,430 156,124(a)
Circus Circus Enterprises Inc. 21,333 201,330(a)
Comcast Corp. (Class A) 82,789 3,885,909
Comcast UK Cable Partners Ltd.
(Class A) 33,979 526,675(a)
Ford Motor Co. 28,415 1,333,729
Gannett Inc. 76,573 4,101,441
General Motors Corp. 5,020 274,531
Goodyear Tire & Rubber Co. 13,817 709,848
Harman International
Industries Inc. 15,014 550,826
Interpublic Group Cos. Inc. 76,066 4,102,810
ITT Industries Inc. 16,460 557,583
Knight-Ridder Inc. 37,323 1,660,874
McDonald's Corp. 46,986 2,804,477
Metromedia International
Group Inc. 9,054 35,084(a)
NTL Inc. 84,355 3,627,265(a)
Stanley Works 30,507 907,583
Tele-Communications Inc. (Series A) 93,593 3,661,826(a)
Tele-Communications Inc. Liberty
Media Group (Series A) 31,760 1,165,195(a)
Tele-Communications TCI
Ventures Group 32,239 578,287(a)
Time Warner Inc. 14,111 1,235,594
Walt Disney Co. 158,028 4,000,084(h)
Xerox Corp. 39,110 3,314,572
42,589,217
CONSUMER - STABLE -- 7.6%
Anheuser Busch Cos. Inc. 72,970 3,940,380(h)
Archer-Daniels Midland Co. 38,686 647,991
Avon Products Inc. 89,789 2,519,704
Bestfoods 33,694 1,632,053
Coca Cola Co. 3,334 192,122
Colgate-Palmolive Co. 25,791 1,766,683
Conagra Inc. 27,633 744,364
Diageo PLC 12,895 122,768
General Mills Inc. 18,423 1,289,610
Gillette Co. 12,766 488,300
Hershey Foods Corp. 7,507 513,760
International Multifoods Corp. 4,145 68,133
Kellogg Co. 13,816 455,065
Kimberly Clark Corp. 72,348 2,930,094
Nestle S.A. (Regd.) 608 1,213,005
Pepsico Inc. 160,695 4,730,459
Philip Morris Cos. Inc. 122,644 5,649,289(h)
Procter & Gamble Co. 39,681 2,814,871
Ralston Purina Co. 73,677 2,155,052
Sara Lee Corp. 68,161 3,680,694
Sysco Corp. 22,125 521,320
Unilever N.V 11,744 719,320
38,795,037
- ----------
See Notes to Schedule of Investments and Financial Statements.
17
<PAGE>
GE U.S. EQUITY FUND
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
[GRAPHIC OF GAS PUMP OMITTED]
ENERGY -- 8.7%
Anadarko Petroleum Co. 25,293 $ 994,331
Atlantic Richfield Co. 11,238 797,196
Baker Hughes Inc. 74,600 1,561,937
British Petroleum PLC ADR 26,401 2,303,511
Burlington Resources Inc. 97,609 3,648,136
Chevron Corp. 21,002 1,765,481
Elf Aquitaine S.A. ADR 7,507 466,841
Exxon Corp. 131,074 9,199,756(h)
Halliburton Co. 7,903 225,729
Mobil Corp. 62,772 4,766,749
Nabors Industries Inc. 52,926 803,814(a)
Newpark Resources Inc. 17,041 117,157(a)
R & B Falcon Corp. 32,238 386,856(a)
Royal Dutch Petroleum Co. ADR 90,314 4,301,204
Schlumberger Ltd. 125,730 6,325,791
Texaco Inc. 33,546 2,102,915
Tosco Corp. 15,410 331,315
Total S.A. ADR 14,738 925,731
Unocal Corp. 81,876 2,968,005
USX-Marathon Group 4,606 163,225
YPF S.A. ADR (Class D) 18,772 488,072
44,643,752
[GRAPHIC OF MONEY OMITTED]
FINANCIAL -- 10.8%
American Express Co. 62,974 4,888,357(h)
AmSouth Bancorp 10,132 345,755
Associates First Capital Corp. 21,877 1,427,474
Bank of New York Inc. 33,079 905,538
BankAmerica Corp. 68,228 4,102,208
BankBoston Corp. 69,772 2,302,476
Chase Manhattan Corp. 51,352 2,220,974
Citicorp 58,325 5,420,580
Comerica Inc. 5,923 324,654
Countrywide Credit Industries 10,224 425,574
Crestar Financial Corp. 8,478 481,126
Echelon International Corp. 1 21(a)
Edwards A.G. Inc. 15,309 464,054
Federal National Mortgage Assoc 184,471 11,852,262
First Union Corp. 13,301 680,845
Fleet Financial Group Inc. 7,111 522,214
GATX Corp. 6,217 205,550
Household International Inc. 1,636 61,350
ING Groep N.V. ADR 10,132 444,542
Morgan Stanley, Dean Witter 58,813 2,532,635
National City Corp. 30,157 1,988,477
NationsBank Corp. 9,211 492,788
Norwest Corp. 16,598 594,416
State Street Corp. 23,856 1,301,643
T. Rowe Price & Associates 11,053 324,682
Travelers Group Inc. 186,569 6,996,337
United States Bancorp 36,896 1,312,114
Wachovia Corp. 8,695 741,249
Waddell & Reed Financial Inc.
(Class A) 18,422 350,018
Wells Fargo & Co. 4,192 1,488,160
55,198,073
[GRAPHIC OF HEALTH SIGN OMITTED]
HEALTHCARE -- 15.2%
Abbott Laboratories 186,089 8,083,241
Allergan Inc. 66,089 3,857,945
American Home Products Corp. 92,756 4,858,096(h)
Bristol-Myers Squibb Co. 104,610 10,866,364
Cardinal Health Inc. 78,315 8,086,024
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
Dentsply International Inc. 26,472 $ 592,311
Eli Lilly & Co. 6,715 525,868
Henry Schein Inc. 12,066 419,294(a)
Johnson & Johnson 117,698 9,209,868
Lincare Holdings Inc. 30,396 1,177,845(a)
Merck & Co. Inc. 95,011 12,309,863
Mylan Laboratories Inc. 7,368 217,356
Omnicare Inc. 8,289 292,187
Pfizer Inc. 45,594 4,830,114
Pharmacia & Upjohn Inc. 42,832 2,149,631
Pharmerica Inc. 14,222 77,332(a)
Schering Plough Corp. 35,923 3,720,276
Shire Pharmaceuticals Group
PLC ADR 10,592 231,700(a)
Smithkline Beecham PLC ADR 4,603 252,014
Sun Healthcare Group Inc. 14,737 95,791(a)
Sybron International Corp. 46,035 880,419(a)
Tenet Healthcare Corp. 35,002 1,006,308(a)
Watson Pharmaceuticals Inc. 79,215 4,020,161(a)
77,760,008
INSURANCE -- 5.5%
Allstate Corp. 9,212 384,025
American International Group Inc. 55,092 4,242,045
AXA-UAP 4,606 421,958
Chubb Corp. 23,009 1,449,567
General Reinsurance Corp. 26,269 5,332,607
Hartford Financial Services
Group Inc. 18,422 873,894
Jefferson-Pilot Corp. 6,908 417,934
Lincoln National Corp. 25,791 2,121,310
Loews Corp. 44,987 3,795,778
Marsh & McLennan Cos. Inc. 67,995 3,382,751
Progressive Corp. 2,303 259,663
Provident Cos. Inc. 70,050 2,364,187
Reliastar Financial Corp. 24,924 972,036
St. Paul Cos. Inc. 23,857 775,353
SunAmerica Inc. 1,842 112,362
UNUM Corp. 28,695 1,425,783
28,331,253
RETAIL TRADE -- 4.5%
Costco Cos. Inc. 25,791 1,221,848(a)
CVS Corp. 32,698 1,432,581
Dayton Hudson Corp. 102,465 3,663,124
Federated Department Stores Inc. 41,450 1,507,744(a)
Home Depot Inc. 112,042 4,425,659
Lowes Cos. Inc. 57,910 1,842,262
Sears Roebuck & Co. 76,618 3,385,558
Wal-Mart Stores Inc. 107,356 5,864,321
23,343,097
TECHNOLOGY - ELECTRONICS & EQUIPMENT -- 6.7%
3Com Corp. 11,974 359,968(a)
Analog Devices Inc. 44,444 713,882(a)
Applied Materials Inc. 23,479 592,845(a)
Cisco Systems Inc. 88,536 5,472,631(a)
EG & G Inc. 14,968 338,651
GTECH Holdings Corp. 9,091 241,480(a)
Hewlett Packard Co. 41,265 2,184,466
Intel Corp. 75,023 6,433,222
International Business Machines 81,739 10,462,592
Perkin Elmer Corp. 5,527 379,636
Pitney Bowes Inc. 82,833 4,353,909
- ----------
See Notes to Schedule of Investments and Financial Statements.
18
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
Storage Technology Corp. 18,191 $ 462,734(a)
Sun Microsystems Inc. 46,928 2,337,601(a)
Varian Associates Inc. 5,296 186,684
34,520,301
TECHNOLOGY - SOFTWARE & SERVICES -- 5.1%
Automatic Data Processing Inc. 70,188 5,246,553
Computer Associates
International Inc. 4,817 178,229
Computer Sciences Corp. 5,536 301,712
EMC Corp. 55,542 3,176,308(a)
Equifax Inc. 191,586 6,837,225
First Data Corp. 279,093 6,558,685
Microsoft Corp. 13,595 1,496,300(a)
Reuters Holdings PLC ADR 41,486 2,063,928
Symantec Corp. 16,120 212,583(a)
UNOVA Inc. 5,378 88,401(a)
26,159,924
TRANSPORTATION -- 2.2%
AMR Corp. 11,717 649,561(a)
Burlington Northern Santa Fe 128,548 4,113,536
Canadian Pacific Ltd. 60,342 1,248,325
Continental Airlines Inc. (Class B) 59,025 2,228,194(a)
Delta Air Lines Inc. 23,028 2,239,473
FDX Corp. 9,211 415,646(a)
Pittston Brinks Group 15,410 539,350
11,434,085
[GRAPHIC OF PLUG OMITTED]
UTILITIES -- 9.0%
Airtouch Communications Inc. 137,124 7,816,068(a)
American Electric Power Inc. 31,318 1,528,710
American Telephone &
Telegraph Corp. 55,412 3,238,139
Bell Atlantic Corp. 77,833 3,770,036
Bellsouth Corp. 12,896 970,424
Cincinnati Bell Inc. 12,895 335,270
CMS Energy Corp. 31,042 1,352,267
Duke Energy Corp. 57,428 3,801,016
Edison International 23,029 591,557
El Paso Energy Corp. 25,929 841,072
Florida Progress Corp. 24,870 1,077,182
FPL Group Inc. 20,430 1,423,715
GTE Corp. 40,068 2,203,740
Illinova Corp. 13,356 383,150
MCI WorldCom Inc. 56,531 2,762,963(a)
MCN Energy Group Inc. 22,106 377,184
New Century Energies Inc. 16,598 808,115
Niagara Mohawk Power Corp. 23,028 354,055(a)
Northern States Power Co. 27,633 775,451
Peco Energy Co. 7,831 286,321
SBC Communications Inc. 161,655 7,183,544
Sprint Corp. 19,528 1,406,016
Texas Utilities Co. 23,948 1,115,079
U.S. WEST Inc. 30,397 1,593,943
45,995,017
TOTAL COMMON STOCK
(COST $429,927,527) 496,070,697
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
PREFERRED STOCK -- 0.6%
- --------------------------------------------------------------------------------
Microsoft Corp. (Series A), $2.20
(COST $2,999,902) 34,772 $ 3,351,152
TOTAL INVESTMENTS IN SECURITIES
(COST $432,927,429) 499,421,849
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 2.4%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund 11,758,616 11,758,616
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
TIME DEPOSIT
State Street Cayman Islands
5.625% 10/01/98 485,000 485,000
TOTAL SHORT-TERM INVESTMENTS
(COST $12,243,616) 12,243,616
OTHER ASSETS AND LIABILITIES,
NET 0.3% 1,432,930
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $513,098,395
================================================================================
- --------------------------------------------------------------------------------
OTHER INFORMATION
- --------------------------------------------------------------------------------
The GE U.S. Equity Fund had the following long Futures Contracts open at
September 30, 1998:
NUMBER
EXPIRATION OF UNDERLYING UNREALIZED
DESCRIPTION DATE CONTRACTS FACE VALUE LOSS
- --------------------------------------------------------------------------------
S&P 500 December 1998 10 $ 2,565,000 $(5,424)
[GRAPHIC OMITTED]
ICONS REPRESENT THE TOP FIVE INDUSTRY WEIGHTINGS IN THE
GE U.S. EQUITY FUND AT SEPTEMBER 30, 1998.
- ----------
See Notes to Schedule of Investments and Financial Statements.
19
<PAGE>
GE MID-CAP GROWTH FUND
Q&A
Elaine G. Harris is the Portfolio Manager of the GE Mid-Cap Growth Fund. Elaine
is currently a Senior Vice President of GE Investments and manages equity assets
which exceed $1 billion. She has more than 14 years of investment experience and
has held positions with GE Investments since 1993. From 1991 to 1993, Elaine
served as Senior Vice President and Portfolio Manager at SunAmerica Asset
Management and before that as Portfolio Manager at Alliance Capital Management
Company and in various positions at Fidelity Management and Research
Corporation. Elaine is a member of the New York Society of Security Analysts.
She holds an MBA in Finance from the Wharton School and a BA in Math and
Computer Science from Tufts University.
Q. HOW DID THE GE MID-CAP GROWTH FUND'S INDUSTRY BENCHMARK AND LIPPER PEERS
PERFORM FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. The fund's benchmark, the Standard & Poors Composite Index of 400 mid-cap
stocks, dropped 6.14%. Our Lipper peer group of 298 Mid-Cap funds was down
11.95% for the same period. To see how your class of shares in the GE
Mid-Cap Growth Fund performed compared to its benchmarks, please refer to
the following page.
Q. WHAT FACTORS CONTRIBUTED TO THE FUND'S PERFORMANCE?
A. The fund did not perform as well as its benchmark or its peer group. In
this market downturn, consumer goods and healthcare stocks held up best. We
were underinvested in both areas because these stocks looked expensive,
selling at a price/earnings ratio greater than their growth rate. We were
overweighted in the capital goods sector. Many companies in cyclical
industries declined as much as 30% to 50%, in line with their industry
group, even though corporate performance was on track.
Q. WHICH STOCKS IN THE PORTFOLIO DID WELL?
A. In technology, Compuware, a software company with strong year 2000 and
client/server business, was up 83%, Berg Electronics, a semiconductor
company with a new corporate parent, rose 50%; and Gilat Satellite
Networks, a leader in satellite communications, advanced nearly 60%. In
healthcare, which tends to do well in a slowing economy, top performers
included drug distributors McKesson (+70%) and Cardinal Health (+40%), and
a drug maker, Mylan Laboratories (+40%).
Q. WHAT CHANGES HAVE YOU MADE IN THE PORTFOLIO?
A. We eliminated the fund's exposure in the agricultural area out of concern
that the marketplace may not recover quickly. We plan to add to our
position in healthcare, especially if stock prices become cheaper. Many
consumer goods companies are attractive because stock prices have dropped
as much as 50%. Given the current economic environment, we do not plan to
increase holdings in industrial or capital goods companies.
Q. WHAT IS YOUR OUTLOOK FOR THE FUND?
A. Because of the uncertain global economic climate, we plan to invest in
companies whose business is focused in the U.S. Attractive industries are
healthcare and consolidating industries where momentum is independent of
economic considerations. Providers of outsourced services also are
promising investments as companies continue to look for ways to remove cost
from operations.
[Picture of Elaine G. Harris Omitted]
20
<PAGE>
GE MID-CAP GROWTH FUND
================================================================================
TOP TEN LARGEST HOLDINGS
AT SEPTEMBER 30, 1998
============================================================================
McKesson Corp. 2.20%
- ----------------------------------------------------------------------------
Nokia Corp. ADR 2.11%
- ----------------------------------------------------------------------------
Airtouch Communications Inc. 1.89%
- ----------------------------------------------------------------------------
Berg Electronics Corp. 1.83%
- ----------------------------------------------------------------------------
Cardinal Health Inc. 1.78%
- ----------------------------------------------------------------------------
HBO & Co. 1.72%
- ----------------------------------------------------------------------------
HealthCare Financial Partners Inc. 1.71%
- ----------------------------------------------------------------------------
Firstar Corp. 1.65%
- ----------------------------------------------------------------------------
Tyco International Ltd. 1.65%
- ----------------------------------------------------------------------------
MCI WorldCom Inc. 1.62%
- ----------------------------------------------------------------------------
INVESTMENT PROFILE
A mutual fund designed for investors who seek long-term growth of capital by
investing primarily in equity securities of companies with medium-sized market
capitalizations that have the potential for above-average growth.
* LIPPER PERFORMANCE COMPARISON
Mid-Cap Peer Group
Based on average annual total returns for the periods ended 9/30/98
One Three Five
Year Year Year
Number of Funds
in peer group: 298 178 99
Peer group
average annual
total return: -11.95% 9.10% 10.62%
Lipper categories
in peer group: Mid-Cap
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- ----------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A
W/O LOAD W/LOAD S&P 400 MID CAP
9/93 10000 10000 10000
10435.29 9835.26 10335.74
9847.06 9280.85 9949.26
9447.06 8903.85 9565.21
9/94 10251.1 9661.66 10205.03
10322.37 9728.83 9951.67
11106.35 10467.73 10768.61
12377.34 11665.64 11704.57
9/95 13743.36 12953.12 12854.13
13588.94 12807.58 13000.64
14277.89 13456.91 13778.25
14551.1 13714.41 14172.93
9/96 15715.18 14811.56 14556.15
16000.27 15080.25 15434.45
15430.1 14542.87 15214.14
18447.23 17386.51 17464.08
9/97 20917.94 19715.16 20284.85
20200.03 19038.53 20461.56
22427.98 21138.37 22702.66
21536.8 20298.43 22235.63
9/98 17548 16536 19083.19
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Mid-Cap Growth -16.11% 11.03% 11.75%
GE Mid-Cap Growth w/load -20.92% 9.72% 10.44%
(maximum load-5.75%)
S&P 400 Mid-Cap -6.14% 13.53% -13.61%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
W/O LOAD W/LOAD S&P 400 MID CAP
9/93 10000 10000 10000
10423.53 10423.53 10335.74
9823.53 9823.53 9949.26
9400 9400 9565.21
9/94 10180.31 10180.31 10205.03
10227.82 10227.82 9951.67
10976.2 10976.2 10768.61
12211.62 12211.62 11704.57
9/95 13542.06 13542.06 12854.13
13363.88 13363.88 13000.64
14017.22 14017.22 13778.25
14266.68 14266.68 14172.93
9/96 15383.31 15383.31 14556.15
15632.77 15632.77 15434.45
15050.7 15050.7 15214.14
17949.17 17949.17 17464.08
9/97 20336.85 20336.85 20284.85
19610.16 19610.16 20461.56
21740.75 21740.75 22702.66
20849.38 20849.38 22235.63
9/98 16958 16958 19083.19
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Mid-Cap Growth -16.62% 10.25% 10.99%
GE Mid-Cap Growth w/load -18.44% 10.13% 10.99%
maximum load 4.0% 1.0% 0.0%
S&P 400 Mid-Cap -6.14% 13.53% -13.61%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS C
S&P 400 MID CAP
10/3/97 10000 10000
10/97 9490 9535.4
11/97 9488.44 9678.92
12/97 9581.01 10062.21
1/98 9442.15 9865.51
2/98 10275.29 10678.59
3/98 10645.57 11164.29
4/98 10691.85 11365
5/98 10182.72 10854.66
6/98 10229 10934.63
7/98 9766.24 10511.89
8/98 7961.05 8572.45
9/98 8331.24 9384.38
AGGREGATE ANNUAL
TOTAL RETURN
SINCE
INCEPTION
GE Mid-Cap Growth -16.69%
S&P 400 Mid-Cap -6.16%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS D
JAN 6, 98
S&P 400 MID CAP
12/97 10000 10000
1/98 9830 9847.5
2/98 10720 10659.09
3/98 11120 11143.91
4/98 11140 11344.25
5/98 10620 10834.84
6/98 10680 10914.66
7/98 10219.69 10492.7
8/98 8319.85 8556.8
9/98 8710.05 9367.24
AVERAGE ANNUAL
TOTAL RETURN
SINCE
INCEPTION
GE Mid-Cap Growth -12.90%
S&P 400 Mid-Cap -6.33%
Legend as Follows:
GE Mid Cap Fund
GE Mid Cap Fund w/load
S&P 400
21
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
GE MID-CAP FUND
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Transportation 2.5%
Utilities 4.1%
Insurance 5.1%
Cash & Other 6.7%
Consumer 6.9%
Retail Trade 6.9%
Energy & Basic Materials 10.3%
Healthcare 13.2%
Financials 13.3%
Technology 14.1%
Capital Goods 16.9%
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
COMMON STOCK -- 93.3%
- --------------------------------------------------------------------------------
BASIC MATERIALS -- 3.6%
Crompton & Knowles Corp. 18,144 $ 264,222
Minerals Technologies Inc. 9,237 407,005
Morton International Inc. 11,876 259,788
Sealed Air Corp. 9,237 294,429(a)
1,225,444
[GRAPHIC OF FACTORY OMITTED]
CAPITAL GOODS -- 16.9%
Allied Waste Industries Inc. 5,938 138,801(a)
AlliedSignal Inc. 9,897 350,106
Berg Electronics Corp. 18,141 628,132(a)
Dover Corp. 12,536 387,049
Gerber Scientific Inc. 7,008 189,216
Hexcel Corp. 6,827 73,390(a)
Hubbell Inc. (Class B) 8,742 310,341
JLK Direct Distribution Inc.
(Class A) 8,246 88,644(a)
Kennametal Inc. 8,412 226,598
Martin Marietta Materials Inc. 11,711 505,769
Masco Corp. 17,814 438,670
Mettler-Toledo International Inc. 16,494 354,621(a)
Molex Inc. (Class A) 12,990 352,354
Oak Industries Inc. 7,093 191,511(a)
Textron Inc. 6,433 390,001
Thermo Electron Corp. 10,557 159,015(a)
Thomas & Betts Corp. 7,423 282,538
Tyco International Ltd. 10,227 565,041
U.S. Filter Corp. 11,546 184,736(a)
5,816,533
[GRAPHIC OF PRODUCTS OMITTED]
CONSUMER - CYCLICAL -- 6.9%
Cendant Corp. 13,476 156,659(a)
CKS Group Inc. 10,557 186,727(a)
Interpublic Group Cos. Inc. 8,412 453,722
Jacor Communications Inc. 9,237 467,623(a)
Jones Apparel Group Inc. 15,834 363,192(a)
Laidlaw Environmental Services Inc. 13,196 124,537(h)
United Rentals Inc. 12,370 296,107(a)
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
Walter Industries Inc. 10,301 $ 128,119(a)
Wolverine World Wide Inc. 18,804 204,493
2,381,179
ENERGY -- 6.7%
Anadarko Petroleum Co. 11,546 453,902
Apache Corp. 9,897 265,363(h)
BJ Services Co. 11,216 182,260(a)
Burlington Resources Inc. 8,049 300,831
Nabors Industries Inc. 10,557 160,335(a)
Schlumberger Ltd. 5,113 257,248
Tosco Corp. 12,371 265,977
USX-Marathon Group 11,216 397,467
2,283,383
[GRAPHIC OF MONEY OMITTED]
FINANCIAL -- 13.3%
American Express Co. 5,113 396,897(h)
Comdisco Inc. 26,392 359,591
Crestar Financial Corp. 8,742 496,108
FINOVA Group Inc. 8,907 444,793
First American Corp. 8,742 335,474
Firstar Corp. 11,216 567,810
GATX Corp. 12,866 425,382
HealthCare Financial Partners Inc. 14,020 588,840(a)
Imperial Credit Industries Inc. 16,330 102,063(a)
New Century Financial Corp. 23,422 177,129(a)
Summit Bancorp 9,402 352,575
Travelers Group Inc. 8,907 334,013
4,580,675
[GRAPHIC OF HEALTH SIGN OMITTED]
HEALTHCARE -- 13.2%
Baxter International Inc. 7,917 471,062
Cardinal Health Inc. 5,938 613,098
Covance Inc. 19,629 509,127(a)
Henry Schein Inc. 11,711 406,957(a)
McKesson Corp. 8,248 755,723
MedPartners Inc. 7,422 24,122(a)
Mylan Laboratories Inc. 13,436 396,362(h)
Sybron International Corp. 19,464 372,249(a)
Tenet Healthcare Corp. 14,680 422,050(a)
Teva Pharmaceutical Industries
Ltd. ADR 7,423 281,146
United Healthcare Corp. 8,082 282,870
4,534,766
INSURANCE -- 5.1%
American International Group Inc. 6,186 476,322(h)
Equitable Cos. Inc. 9,897 409,488
Hartford Financial Services
Group Inc. 9,566 453,787
Provident Cos. Inc. 12,206 411,953
1,751,550
RETAIL TRADE -- 6.9%
Barnes & Noble Inc. 15,670 423,090(a)
Consolidated Stores Corp. 9,732 190,991(a)
Federated Department Stores Inc. 9,402 341,998(a)
Pier 1 Imports Inc. 21,536 161,520
Polo Ralph Lauren Corp. (Class A) 12,536 249,936(a)
St. John Knits Inc. 9,072 146,286
The Timberland Co. 4,786 174,689(a)
- ----------
See Notes to Schedule of Investments and Financial Statements.
22
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
Tiffany & Co. 9,237 $ 289,811
Zale Corp. 15,010 384,631(a,h)
2,362,952
TECHNOLOGY - ELECTRONICS & EQUIPMENT -- 6.3%
ADC Telecommunications Inc. 5,114 108,033(a)
Analog Devices Inc. 12,206 196,059(a)
Gilat Satellite Networks Ltd. 11,381 512,145(a)
Nokia Corp. ADR 9,236 724,449
Northern Telecom Ltd. 7,918 253,376
Perkin Elmer Corp. 5,608 385,199
2,179,261
[GRAPHIC OF DISCS OMITTED]
TECHNOLOGY - SOFTWARE & SERVICES -- 7.8%
Cadence Design Systems Inc. 15,505 396,347(a)
Compuware Corp. 7,175 422,428(a)
HBO & Co. 20,454 590,609
National Data Corp. 10,721 331,011
Sterling Commerce Inc. 12,206 422,633(a)
SunGard Data Systems Inc. 16,330 514,395(a)
2,677,423
TRANSPORTATION -- 2.5%
Canadian Pacific Ltd. 14,020 290,039
CNF Transportation Inc. 9,897 288,250
U.S. Xpress Enterprises Inc.
(Class A) 9,898 121,250(a)
Wisconsin Central
Transportation Corp. 11,216 157,024(a)
856,563
UTILITIES -- 4.1%
Airtouch Communications Inc. 11,381 648,717(a)
MCI WorldCom Inc. 11,381 556,247(a)
Qwest Communications
International Inc. 6,641 207,946(a)
1,412,910
TOTAL INVESTMENTS IN SECURITIES
(COST $35,847,737) 32,062,639
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 6.5%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $2,220,429) 2,220,429 $ 2,220,429
OTHER ASSETS AND LIABILITIES,
NET 0.2% 64,573
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $34,347,641
================================================================================
- --------------------------------------------------------------------------------
OTHER INFORMATION
- --------------------------------------------------------------------------------
The GE Mid-Cap Growth Fund had the following short Futures Contracts open at
September 30, 1998:
NUMBER
EXPIRATION OF UNDERLYING UNREALIZED
DESCRIPTION DATE CONTRACTS FACE VALUE LOSS
- --------------------------------------------------------------------------------
S&P Mid-Cap 400 December 1998 6 $ (933,600) $ (425)
[GRAPHIC OMITTED]
ICONS REPRESENT THE TOP FIVE INDUSTRY WEIGHTINGS IN THE
GE MID-CAP GROWTH FUND AT SEPTEMBER 30, 1998.
- ----------
See Notes to Schedule of Investments and Financial Statements.
23
<PAGE>
GE VALUE EQUITY FUND
Q&A
Peter J. Hathaway is the Portfolio Manager for the GE Value Equity Fund. He is
currently a Senior Vice President of GE Investments and manages equity assets of
over $6 billion. Pete has more than 36 years of investment experience and has
held positions with GE Investments since 1985. Pete was Senior Vice President
and portfolio manager at Ameritrust from 1975 to 1985, and he previously held
investment positions at Merrill Lynch, Equitable Life and US Trust. He holds an
MBA from the Wharton School at the University of Pennsylvania and a BS in
Finance from Arizona State University.
Q. HOW DID THE GE VALUE EQUITY FUND'S BENCHMARK AND LIPPER PEERS PERFORM FOR
THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. The S&P/Barra Value Composite Index of 500 value stocks dropped 0.18% for
the one-year period ending September 30. The fund's Lipper peer group of
800 Growth and Income funds fell .06%. To see how your class of shares in
the GE Value Equity Fund performed compared to the aforementioned
benchmarks, please refer to the next page.
Q. WHAT FACTORS INFLUENCED FUND PERFORMANCE?
A. All of our fund classes significantly outperformed their benchmarks. The
fund concentrates on large-cap stocks, which did well during the recent
period of market volatility, as they have all year. Drug and technology
stocks were among the fund's top performers. During the last six months, we
increased our position in utilities, especially electric companies which
benefited from lower interest rates. As the Asian economic crisis deepened
and troubles spread to Russia and emerging markets, the fund built up
positions in companies whose markets are U.S.-based. For example, the fund
holds Martin Marietta Materials, whose earnings benefit from the nationwide
increase in road-building.
Q. WHICH STOCKS WERE NOTEWORTHY?
A. Some of the portfolio's better performing stocks were Sara Lee in consumer
goods, Bristol Myers in the drug sector, and Duke Energy Corporation, an
electric utility. Lower interest rates helped Home Depot and Lowes, which
sell to homeowners. Continental and Delta airlines also had good numbers.
Some analysts predict a cyclical downturn in airlines. The industry is much
better run than it was five years ago and yields are good, so we will
continue to hold these stocks although we may not add to our position.
Q. WHAT IS YOUR STRATEGY FOR THE FUND IN THIS MARKET?
A. We have adopted a defensive investment strategy for several reasons. The
U.S. economy faces more risk from Asia. Excess global capacity may pressure
corporate profits in 1999. Stock valuations are still too high.
The fund has relatively low turnover and a long-term focus, generally
intending to hold stocks for three or four years. We will seek to take
advantage of the market's increased volatility by adding to positions we
think are undervalued on weakness and reducing positions as they approach
price targets. We have cut back in areas such as capital goods and
technology as the economy slows and businesses reduce capital expenditures.
We increased weightings in utilities and large integrated oil companies
because both have good dividend yields. We are focused on food, drugs and
other consumer staples whose earnings tend not to follow economic cycles.
Our final strategy in this volatile market is, simply put, to avoid problem
stocks.
[picture of Peter J. Hathaway Omitted]
24
<PAGE>
GE VALUE EQUITY FUND
======================================================================
TOP TEN LARGEST HOLDINGS
AT SEPTEMBER 30, 1998
======================================================================
International Business Machines 2.91%
- -----------------------------------------------------
Merck & Co. Inc. 2.43%
- -----------------------------------------------------
Bristol-Myers Squibb Co. 2.29%
- -----------------------------------------------------
Federal National Mortgage Assoc 1.84%
- -----------------------------------------------------
Exxon Corp. 1.73%
- -----------------------------------------------------
Wal-Mart Stores Inc. 1.73%
- -----------------------------------------------------
Cisco Systems Inc. 1.59%
- -----------------------------------------------------
Schering Plough Corp. 1.50%
- -----------------------------------------------------
Johnson & Johnson 1.45%
- -----------------------------------------------------
SBC Communications Inc. 1.35%
- -----------------------------------------------------
INVESTMENT PROFILE
A mutual fund designed for investors who seek long-term growth of capital and
future income by investing primarily in equity securities of companies with
large-sized market capitalizations that the Fund's management considers to be
undervalued by the market.
* LIPPER PERFORMANCE COMPARISON
Growth and Income Peer Group
Based on average annual total returns for the periods ended 9/30/98
One Three Five
Year Year Year
Number of Funds
in peer group: 800 498 326
Peer group
average annual
total return: -0.06% 17.16% 15.58%
Lipper categories
in peer group: Growth & Income, S&P 500 Index
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- ----------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A
W/O LOAD W/LOAD S&P 500 BARRA VALUE
9/93 10000 10000 10000
10141.36 9558.23 10041.89
9573.86 9023.37 9714
9594.86 9043.16 9803.34
9/94 9925.18 9354.48 10054.67
9972.2 9398.8 9979.02
10731.37 10114.31 10940.99
11517.08 10854.85 11893.55
9/95 12288.84 11582.23 12839.03
12919.1 12176.25 13669.45
13491.08 12715.34 14543.03
13986.04 13181.85 14841.62
9/96 14770.05 13920.77 15232.85
15843.18 14932.19 16674.41
16253.7 15319.11 16969.02
19568.3 18443.12 19423.9
9/97 20647.82 19460.57 21203.35
21087.9 19875.35 21673.4
23729.39 22364.95 24177.39
24345.74 22945.86 24302.52
9/98 21858 20601.48 21164.4
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Value Equity 5.86% 16.84% 16.70%
GE Value Equity w/load -0.23% 15.46% 15.34%
(maximum load-5.75%)
S&P 500/Barra Value -0.18% 16.18% 15.95%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
W/O LOAD W/LOAD S&P 500 BARRA VALUE
9/93 10000 10000 10000
10146.82 10146.82 10041.89
9555.57 9555.57 9714
9560.91 9560.91 9803.34
9/94 9873.06 9873.06 10054.67
9901.68 9901.68 9979.02
10625.67 10625.67 10940.99
11383.23 11383.23 11893.55
9/95 12139.56 12139.56 12839.03
12724.23 12724.23 13669.45
13268.08 13268.08 14543.03
13732.38 13732.38 14841.62
9/96 14461.66 14461.66 15232.85
15490.47 15490.47 16674.41
15862.84 15862.84 16969.02
19065.19 19065.19 19423.9
9/97 20078.03 20078.03 21203.35
20474.92 20474.92 21673.4
23007.23 23007.23 24177.39
23569.96 23569.96 24302.52
9/98 21146 21146 21164.4
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Value Equity 5.32% 16.00% 15.94%
GE Value Equity
w/load 2.42% 15.89% 15.94%
maximum load 4.0% 1.0% 0.0%
S&P 500/Barra Value -0.18% 16.18% 15.95%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS C OCT 3, 97
S&P 500 BARRA VALUE
10/3/97 10000 10000
10/97 9510 9548
11/97 9896.4 9911.78
12/97 10122.11 10132.02
1/98 10174.19 10007.09
2/98 10868.68 10757.72
3/98 11406.9 11302.6
4/98 11597.89 11436.42
5/98 11406.9 11275.51
6/98 11702.06 11361.09
7/98 11545.54 11114.56
8/98 9931.48 9327.34
9/98 10521.41 9894.07
AGGREGATE ANNUAL
TOTAL RETURN
SINCE
INCEPTION
GE Value Equity 5.21%
S&P 500/Barra Value -1.06%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS D JAN 6, 98 JAN 6, 98
S&P 500 BARRA VALUE
12/97 10000 10000
1/98 10010 9865.3
2/98 10700 10605.3
3/98 11240 11142.45
4/98 11430 11274.38
5/98 11240 11115.75
6/98 11540 11200.12
7/98 11379.59 10957.08
8/98 9789.86 9195.18
9/98 10380.19 9753.88
AVERAGE ANNUAL
TOTAL RETURN
SINCE
INCEPTION
GE Value Equity 3.80%
S&P 500/Barra Value -2.46%
Legend as Follows:
GE Value Fund
GE Value Fund w/load
S&P 500
25
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
GE VALUE EQUITY FUND
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Cash & Other 4.0%
Transportation 3.6%
Insurance 4.9%
Retail Trade 6.3%
Capital Goods 8.9%
Utilities 10.7%
Healthcare 13.2%
Energy & Basic Materials 11.6%
Consumer 13.4%
Financials 11.5%
Technology 11.9%
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
COMMON STOCK -- 94.9%
- --------------------------------------------------------------------------------
BASIC MATERIALS -- 2.9%
Barrick Gold Corp. 8,021 $ 160,420
Delta & Pine Land Co. 1,987 87,428
Du Pont de Nemours (E.I.) & Co. 12,854 721,431
Mead Corp. 4,812 141,653
Newmont Mining Corp. 18,229 442,053
Rayonier Inc. 4,207 164,073
Weyerhaeuser Co. 2,907 122,639
1,839,697
[GRAPHIC OF FACTORY OMITTED]
CAPITAL GOODS -- 8.9%
AlliedSignal Inc. 21,271 752,462(h)
Cooper Industries Inc. 7,011 285,698
Deere & Co. 8,180 247,445
Dover Corp. 15,887 490,511(h)
Emerson Electric Co. 10,925 680,081(h)
Hubbell Inc. (Class B) 12,152 431,396
Lockheed Martin Corp. 3,272 329,859
Martin Marietta Materials Inc. 10,984 474,372
Masco Corp. 7,011 172,646
Molex Inc. (Class A) 1,103 29,919
Parker Hannifin Corp. 3,740 111,031
Sherwin-Williams Co. 7,317 158,230
Textron Inc. 12,223 741,019
Timken Co. 2,804 42,411
United Technologies Corp. 4,460 340,911
Waste Management Inc. 6,894 331,343
5,619,334
CONSUMER - CYCLICAL -- 5.7%
ACNielsen Corp. 2,606 57,983(a)
Comcast Corp. (Class A) 3,506 164,563
Ford Motor Co. 4,674 219,386
Gannett Inc. 7,245 388,060
Goodyear Tire & Rubber Co. 3,506 180,121
Interpublic Group Cos. Inc. 4,791 258,415
ITT Industries Inc. 1,169 39,600
Knight-Ridder Inc. 5,259 234,025
McDonald's Corp. 9,273 553,482
Stanley Works 2,337 69,526
Tele-Communications Inc. (Series A) 7,245 283,461(a)
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
Walt Disney Co. 15,157 $ 383,661
Xerox Corp. 8,921 756,055
3,588,338
CONSUMER - STABLE -- 7.7%
Anheuser Busch Cos. Inc. 8,179 441,666(h)
Archer-Daniels Midland Co. 9,815 164,401
Avon Products Inc. 7,477 209,823
Bestfoods 5,843 283,020
Colgate-Palmolive Co. 2,900 198,650
Conagra Inc. 7,011 188,859
General Mills Inc. 4,674 327,180
Kimberly Clark Corp. 1,704 69,012
Nestle S.A. (Regd.) 154 307,241
Pepsico Inc. 18,584 547,067(h)
Philip Morris Cos. Inc. 8,219 378,588
Procter & Gamble Co. 6,310 447,616
Ralston Purina Co. 14,139 413,566
Sara Lee Corp. 14,022 757,188
Sysco Corp. 5,613 132,256
4,866,133
[GRAPHIC OF GAS PUMP OMITTED]
ENERGY -- 8.7%
British Petroleum PLC ADR 4,536 395,769
Burlington Resources Inc. 12,029 449,584(h)
Chevron Corp. 3,809 320,194
Exxon Corp. 15,534 1,090,293
Halliburton Co. 2,005 57,268
Mobil Corp. 10,049 763,096
Nabors Industries Inc. 6,310 95,833(a)
R & B Falcon Corp. 5,843 70,116(a)
Royal Dutch Petroleum Co. ADR 10,827 515,636
Schlumberger Ltd. 9,348 470,321
Texaco Inc. 6,015 377,065
Total S.A. ADR 3,739 234,856
Unocal Corp. 13,438 487,127
USX-Marathon Group 1,169 41,426
YPF S.A. ADR (Class D) 3,739 97,214
5,465,798
[GRAPHIC OF MONEY OMITTED]
FINANCIAL -- 11.5%
American Express Co. 8,647 671,223
AmSouth Bancorp 2,571 87,735
Associates First Capital Corp. 4,674 304,978
Bank of New York Inc. 4,412 120,779
BankAmerica Corp. 10,633 639,309
BankBoston Corp. 7,011 231,363
Chase Manhattan Corp. 5,375 232,469
Citicorp 7,536 700,377
Comerica Inc. 1,503 82,383
Crestar Financial Corp. 2,138 121,332
Edwards A.G. Inc. 3,884 117,734
Federal National Mortgage Assoc 17,994 1,156,114
First Union Corp. 3,375 172,758
Fleet Financial Group Inc. 1,804 132,481
ING Groep N.V. ADR 2,577 113,066
Morgan Stanley, Dean Witter 12,970 558,521
National City Corp. 5,843 385,273
Norwest Corp. 4,211 150,806
T. Rowe Price & Associates 2,804 82,368
Travelers Group Inc. 15,991 599,662
United States Bancorp 8,420 299,436
Wachovia Corp. 2,206 188,062
Waddell & Reed Financial Inc.
(Class A) 4,674 88,806
7,237,035
- ----------
See Notes to Schedule of Investments and Financial Statements.
26
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
[GRAPHIC OF HEALTH SIGN OMITTED]
HEALTHCARE -- 13.2%
Abbott Laboratories 15,191 $ 659,859(h)
Allergan Inc. 11,451 668,452
American Home Products Corp. 7,011 367,201(h)
Bristol-Myers Squibb Co. 13,835 1,437,111(h)
Cardinal Health Inc. 6,193 639,427
Johnson & Johnson 11,685 914,351
Merck & Co. Inc. 11,814 1,530,651
Mylan Laboratories Inc. 1,869 55,136
Pfizer Inc. 3,506 371,417
Pharmacia & Upjohn Inc. 6,660 334,249
Schering Plough Corp. 9,114 943,869
Tenet Healthcare Corp. 3,739 107,496(a)
Watson Pharmaceuticals Inc. 5,843 296,532(a)
8,325,751
INSURANCE -- 4.9%
American International Group Inc. 5,305 408,485
AXA-UAP 1,169 107,093
General Reinsurance Corp. 3,309 671,727
Hartford Financial Services
Group Inc. 4,674 221,723
Jefferson-Pilot Corp. 1,754 106,117
Lincoln National Corp. 4,908 403,683
Loews Corp. 3,973 335,222
Progressive Corp. 584 65,846
Provident Cos. Inc. 10,517 354,949
Reliastar Financial Corp. 6,310 246,090
St. Paul Cos. Inc. 4,089 132,892
3,053,827
RETAIL TRADE -- 6.3%
Costco Cos. Inc. 6,544 310,022(a)
CVS Corp. 1,169 51,217
Dayton Hudson Corp. 21,030 751,822(h)
Federated Department Stores Inc. 6,310 229,526(a)
Home Depot Inc. 14,022 553,869
Lowes Cos. Inc. 11,685 371,729
Sears Roebuck & Co. 13,087 578,282
Wal-Mart Stores Inc. 19,865 1,085,126(h)
3,931,593
TECHNOLOGY - ELECTRONICS & EQUIPMENT -- 8.3%
3Com Corp. 3,038 91,330(a)
Analog Devices Inc. 8,881 142,651(a)
Applied Materials Inc. 3,506 88,527(a)
Cisco Systems Inc. 16,125 996,727(a,h)
Hewlett Packard Co. 6,380 337,741
Intel Corp. 8,179 701,349
International Business Machines 14,277 1,827,456
Perkin Elmer Corp. 1,402 96,300
Pitney Bowes Inc. 6,895 362,418
Sun Microsystems Inc. 10,984 547,140(a)
5,191,639
TECHNOLOGY - SOFTWARE & SERVICES -- 2.5%
Automatic Data Processing Inc. 3,410 254,897
Computer Sciences Corp. 1,405 76,573
EMC Corp. 8,413 481,118(a)
Equifax Inc. 9,115 325,292
First Data Corp. 18,696 439,356
UNOVA Inc. 1,365 22,437(a)
1,599,673
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
TRANSPORTATION -- 3.6%
AMR Corp. 2,973 $ 164,816(a)
Burlington Northern Santa Fe 21,033 673,056
Canadian Pacific Ltd. 11,802 244,154
Continental Airlines Inc. (Class B) 12,970 489,617(a)
Delta Air Lines Inc. 5,843 568,232
FDX Corp. 2,337 105,457(a)
2,245,332
[GRAPHIC OF PLUG OMITTED]
UTILITIES -- 10.7%
Airtouch Communications Inc. 6,544 373,008(a)
American Electric Power Inc. 7,946 387,864(h)
American Telephone &
Telegraph Corp. 7,946 464,344
Bell Atlantic Corp. 14,957 724,480(h)
Bellsouth Corp. 3,272 246,218
CMS Energy Corp. 6,590 287,077
Duke Energy Corp. 9,348 618,721
Edison International 3,506 90,060
El Paso Energy Corp. 4,674 151,613
Florida Progress Corp. 6,310 273,302
FPL Group Inc. 3,008 209,620
GTE Corp. 10,155 558,525
MCI WorldCom Inc. 3,155 154,201(a)
MCN Energy Group Inc. 3,272 55,828
New Century Energies Inc. 4,211 205,023
Northern States Power Co. 7,011 196,746
SBC Communications Inc. 19,163 851,556
Sprint Corp. 2,571 185,112
Texas Utilities Co. 6,076 282,914
U.S. WEST Inc. 7,712 404,398
6,720,610
TOTAL COMMON STOCK
(COST $56,220,866) 59,684,760
- --------------------------------------------------------------------------------
PREFERRED STOCK -- 1.1%
- --------------------------------------------------------------------------------
Microsoft Corp. (Series A), $2.20
(COST $623,707) 7,018 676,360
TOTAL INVESTMENTS IN SECURITIES
(COST $56,844,573) 60,361,120
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 3.6%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $2,265,344) 2,265,344 2,265,344
OTHER ASSETS AND LIABILITIES,
NET 0.4% 249,220
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $62,875,684
================================================================================
- --------------------------------------------------------------------------------
OTHER INFORMATION
- --------------------------------------------------------------------------------
The GE Value Equity Fund had the following long Futures Contracts open at
September 30, 1998:
NUMBER
EXPIRATION OF UNDERLYING UNREALIZED
DESCRIPTION DATE CONTRACTS FACE VALUE GAIN
- --------------------------------------------------------------------------------
S&P 500 December 1998 6 $ 1,539,000 $ 20,738
[GRAPHIC OMITTED]
ICONS REPRESENT THE TOP FIVE INDUSTRY WEIGHTINGS IN THE
GE VALUE EQUITY FUND AT SEPTEMBER 30, 1998.
- ----------
See Notes to Schedule of Investments and Financial Statements.
27
<PAGE>
GE STRATEGIC INVESTMENT FUND
Q&A
The GE Strategic Investment Fund is managed jointly by David Carlson, Ralph
Layman and Robert MacDougall. The fund follows an asset allocation strategy and
each portfolio manager is responsible for investments within his area of
expertise: Dave manages the domestic equity investments in the portfolio (please
refer to page 12 for Dave's biographical details), Ralph manages the
international equity holdings within the portfolio (please refer to page 3 for
Ralph's biographical details) and Bob manages the fixed income related
investments in the portfolio (please refer to page 41 for Bob's biographical
details).
Q. HOW DID THE GE STRATEGIC INVESTMENT FUND'S INDUSTRY BENCHMARKS AND LIPPER
PEERS PERFORM FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. The 395 funds in the Lipper peer group of Balanced funds had an average
return of 3.26%. As for the various asset classes in the fund, the Standard
& Poors 500 Composite Index of U.S. stocks returned 9.12% for the year; the
Morgan Stanley Capital International EAFE Index of international stocks was
down 8.34%; and the Lehman Brothers Aggregate Bond Index registered a gain
of 11.50%. To see how your class of shares of GE Strategic Investment Fund
performed compared to its benchmarks, please refer to the following page.
Q. WHAT FACTORS AFFECTED THE FUND'S PERFORMANCE?
A. For the first time in several years, bonds were the best-performing asset
class, followed by U.S. equities. The fund has a slightly higher than
average allocation in fixed income securities than its peer group, which
helped performance. International holdings were hurt by the ongoing
economic situation in Asia and by the August collapse of Russia's economy,
which spread uncertainty to Latin America and other emerging markets.
Q. HOW DID THE FUND'S ASSET ALLOCATIONS CHANGE DURING THE YEAR?
A. Currently, the fund is 46% invested in U.S. equities, 14% in international
equities, 37% in fixed income securities and 3% in cash. During the year,
we reduced our exposure in international equities and increased our
position in domestic equities because we foresaw that Asia's economic
crisis would impact not only the Japanese and Southeast Asian markets, but
eventually European markets. We also increased the percentage of fixed
income securities in the portfolio. Our judgement was proven correct as the
Asian crisis slowed economic growth elsewhere, causing interest rates to
decline and the prices of fixed income securities to rise in value.
Q. WHAT IS YOUR OUTLOOK FOR THE FUND?
A. Despite the recent decline in U.S. stock prices, we are not inclined to
raise our U.S. equity weighting just yet. We remain with a below normal
allocation to U.S. equities. The economy is slowing, and earnings growth
has now turned negative for the first time since the 1990-91 recession.
Valuation levels, while better than they were earlier this year, are still
high by historical standards. We will be looking for an opportunity to
increase the equity weighting in the months to come.
28
<PAGE>
GE STRATEGIC INVESTMENT FUND
======================================================================
TOP TEN LARGEST HOLDINGS
AT SEPTEMBER 30, 1998
======================================================================
Cardinal Health Inc. 1.66%
- ----------------------------------------------------------------------------
Airtouch Communications Inc. 1.55%
- ----------------------------------------------------------------------------
Federal National Mortgage Assoc
5.75% 4/15/03 1.53%
- ----------------------------------------------------------------------------
Federal National Mortgage Assoc 1.52%
- ----------------------------------------------------------------------------
U.S. Treasury Bonds 8.125% 8/15/19 1.35%
- ----------------------------------------------------------------------------
Dover Corp. 1.33%
- ----------------------------------------------------------------------------
Johnson & Johnson 1.27%
- ----------------------------------------------------------------------------
AlliedSignal Inc. 1.27%
- ----------------------------------------------------------------------------
Abbott Laboratories 1.27%
- ----------------------------------------------------------------------------
Equifax Inc. 1.22%
- ----------------------------------------------------------------------------
INVESTMENT PROFILE
A mutual fund designed for investors who seek to maximize total return through
asset allocation designed to achieve capital appreciation primarily from common
stocks and other equity securities and current income from bonds and other fixed
income securities.
* LIPPER PERFORMANCE COMPARISON
Balanced Peer Group
Based on average annual total returns for the periods ended 9/30/98
One Three Five
Year Year Year
Number of Funds
in category: 395 274 146
Peer group
average annual
total return: 3.26% 13.15% 11.58%
Lipper categories
in peer group: Balanced
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- ----------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A W/O LOAD W/LOAD LB AGG. S&P 500
1/1/94 10000 10000 10000 10000
9579.14 9028.34 9712.67 9618.15
9579.14 9040.17 9612.81 9657.88
9/94 9868.08 9300.67 9671.58 10132.9
9820.91 9256.21 9708.14 10129.82
10509.08 9904.81 10197.82 11116.13
11274.43 10626.15 10819.18 12175.41
9/95 11853.26 11171.7 11031.99 13145.54
12476.93 11759.5 11501.83 13927.96
12800.75 12064.71 11296.66 14685.15
13144.39 12388.59 11361.16 15348.14
9/96 13435.17 12662.64 11570.35 15818.4
14156.87 13342.85 11917.58 17147.09
14177.38 13362.18 11851.39 17594.16
15688.1 14786.03 12287.94 20668.75
9/97 16412.69 15468.96 12697.63 22223.07
16658.08 15700.24 13071.71 22856.04
17999.38 16964.41 13273.41 26047.04
18410.42 17351.82 13583.67 26910.44
9/98 17329 16334 14157.79 24249.15
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Strategic Investment 5.58% 13.49% 12.28%
GE Strategic Investment
w/load -0.47% 11.28% 10.89%
(maximum load-5.75%)
S&P 500 9.12% 22.64% 20.50%
LB Aggregate 11.50% 8.67% 7.55%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
W/O LOAD W/LOAD LB AGG S&P 500
10000 10000 10000 10000
12/31/93 10070.87 10070.87 10000 10000
9640.98 9640.98 9712.67 9618.15
9640.98 9640.98 9612.81 9657.88
9/94 9874.9 9874.9 9671.58 10132.9
9819.38 9819.38 9708.14 10129.82
10491.68 10491.68 10197.82 11116.13
11241.55 11241.55 10819.18 12175.41
9/95 11803.95 11803.95 11031.99 13145.54
12409.85 12409.85 11501.83 13927.96
12715.28 12715.28 11296.66 14685.15
13033.99 13033.99 11361.16 15348.14
9/96 13306.23 13306.23 11570.35 15818.4
14005.58 14005.58 11917.58 17147.09
14012.4 14012.4 11851.39 17594.16
15486.67 15486.67 12287.94 20668.75
9/97 16176.03 16076.03 12697.63 22223.07
16374.22 16374.22 13071.71 22856.04
17672.96 17672.96 13273.41 26047.04
18053.25 18053.25 13583.67 26910.44
9/98 16970 16970 14157.79 24249.15
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Strategic Investment 4.91% 12.86% 11.71%
GE Strategic Investment
w/load 0.92% 12.34% 11.71%
maximum load 4.0% 2.0% 0.0%
S&P 500 9.12% 22.64% 20.50%
LB Aggregate 11.50% 8.67% 7.55%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS C
W/O LOAD LB AGG S&P 500
2/22/93 10000 10000 10000
10309.14 10042 10216.1
10436.83 10308.71 10268.05
9/93 10806.46 10577.38 10530.86
10928.42 10583.12 10775.93
10482.79 10279.04 10364.46
10462.21 10173.36 10407.27
9/94 10777.59 10235.55 10919.15
10729.24 10274.25 10915.83
11488.09 10792.48 11978.67
12331.24 11450.07 13120.14
9/95 12970.65 11675.28 14165.55
13654.56 12172.53 15008.68
14023.21 11955.39 15824.63
14399.09 12023.65 16539.05
9/96 14731.61 12245.04 17045.81
15525.56 12612.52 18477.59
15562.97 12542.46 18959.35
17231.49 13004.47 22272.51
9/97 18039.57 13438.06 23947.44
18324.57 13833.94 24629.52
19811.42 14047.41 28068.12
20278.03 14375.76 28998.52
9/98 19100 14983.36 26130.73
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Strategic Investment 5.88% 12.06% 12.24%
S&P 500 9.12% 19.93% 18.69%
LB Aggregate 11.50% 7.21% 7.48%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS D
W/O LOAD LB AGG S&P 500
11/29/93 10000 10000 10000
10152.68 10054 10123.4
9745.04 9765.12 9736.84
9732.3 9664.72 9777.06
9/94 10025.3 9723.81 10257.94
9993.6 9760.57 10254.82
10700.41 10252.89 11253.31
11498.86 10877.6 12325.65
9/95 12100.96 11091.56 13307.76
12750.55 11563.94 14099.83
13101.36 11357.66 14866.37
13472.41 11422.51 15537.53
9/96 13789.47 11632.83 16013.6
14546.31 11981.94 17358.68
14588.35 11915.38 17811.27
16157.9 12354.29 20923.81
9/97 16928.65 12766.2 22497.3
17204.61 13142.29 23138.08
18607.41 13345.09 26368.46
19060.16 13657.02 27242.52
9/98 17962 14234.25 24548.38
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Strategic Investment 6.10% 14.07% 12.87%
S&P 500 9.12% 22.64% 20.40%
LB Aggregate 11.50% 8.67% 7.57%
Legend as Follows:
GE Strategic Fund
GE Strategic Fund w/load
S&P 500
LB Aggregate
29
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
GE STRATEGIC INVESTMENT FUND
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Cash & Other 3.2%
Foreign Equity 13.8%
Bonds & Notes 37.0%
Domestic Equity 46.0%
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
DOMESTIC EQUITY -- 45.5%
- --------------------------------------------------------------------------------
BASIC MATERIALS -- 0.6%
Air Products & Chemicals Inc. 5,850 $ 174,037
Airgas Inc. 18,440 223,585(a)
Great Lakes Chemical Corp. 3,276 127,355
Morton International Inc. 19,071 417,178
942,155
[GRAPHIC OF FACTORY OMITTED]
CAPITAL GOODS -- 5.2%
Alleghany Corp. Delaware 1,040 194,480
AlliedSignal Inc. 52,023 1,840,314
Dover Corp. 62,563 1,931,632
Emerson Electric Co. 4,018 250,120
Hubbell Inc. (Class B) 21,060 747,630
Molex Inc. (Class A) 27,102 735,142
Textron Inc. 3,115 188,847
Tyco International Ltd. 7,355 406,364
United Technologies Corp. 2,174 166,175
Waste Management Inc. 23,634 1,135,909
7,596,613
[GRAPHIC OF PRODUCTS OMITTED]
CONSUMER - CYCLICAL -- 5.5%
Carnival Corp. (Class A) 17,550 558,309
Catalina Marketing Corp. 13,764 646,908(a)
Circus Circus Enterprises Inc. 2,808 26,501(a)
Comcast Corp. (Class A) 23,400 1,098,337
Comcast UK Cable Partners Ltd.
(Class A) 10,240 158,720(a)
Gannett Inc. 10,240 548,480
Harman International
Industries Inc. 7,618 279,485
Interpublic Group Cos. Inc. 14,274 769,904
Metromedia International Group Inc. 4,593 17,798(a)
NTL Inc. 25,740 1,106,820(a)
Stanley Works 7,254 215,806
Tele-Communications Inc. (Series A) 12,168 476,073(a)
Tele-Communications Inc. Liberty
Media Group (Series A) 16,113 591,146(a)
Tele-Communications
TCI Ventures Group 16,359 293,440(a)
Time Warner Inc. 4,362 381,948
Walt Disney Co. 33,439 846,425
8,016,100
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
CONSUMER - STABLE -- 2.8%
Anheuser Busch Cos. Inc. 7,511 $ 405,594
Avon Products Inc. 18,720 525,330
Coca Cola Co. 1,691 97,444
Colgate-Palmolive Co. 3,683 252,286
Gillette Co. 6,476 247,707
Kimberly Clark Corp. 17,667 715,513
Pepsico Inc. 25,267 743,797
Philip Morris Cos. Inc. 23,044 1,061,464
4,049,135
ENERGY -- 3.6%
Anadarko Petroleum Co. 12,832 504,458
Atlantic Richfield Co. 3,604 255,659
Baker Hughes Inc. 21,060 440,944
Burlington Resources Inc. 7,862 293,842
Exxon Corp. 8,607 604,104
Nabors Industries Inc. 10,240 155,520(a)
Newpark Resources Inc. 8,646 59,441(a)
Royal Dutch Petroleum Co. ADR 23,400 1,114,425
Schlumberger Ltd. 27,144 1,365,682
Unocal Corp. 10,764 390,195
5,184,270
[GRAPHIC OF MONEY OMITTED]
FINANCIAL -- 4.9%
American Express Co. 7,427 576,521
Chicago Title Corp. 3,120 137,670
Citicorp 9,927 922,591
Countrywide Credit Industries 5,188 215,951
Federal National Mortgage Assoc 34,253 2,200,755
Morgan Stanley, Dean Witter 1,685 72,560
State Street Corp. 12,104 660,425
Travelers Group Inc. 40,029 1,501,087
Wells Fargo & Co. 2,127 755,085
7,042,645
[GRAPHIC OF HEALTH SIGN OMITTED]
HEALTHCARE -- 10.3%
Abbott Laboratories 42,335 1,838,926
American Home Products Corp. 18,954 992,716
Bristol-Myers Squibb Co. 12,107 1,257,615
Cardinal Health Inc. 23,400 2,416,050
Dentsply International Inc. 13,430 300,496
Eli Lilly & Co. 3,407 266,811
Henry Schein Inc. 6,123 212,774(a)
Johnson & Johnson 23,559 1,843,492
Lincare Holdings Inc. 15,421 597,564(a)
Merck & Co. Inc. 13,652 1,768,787
Omnicare Inc. 4,205 148,226
Pfizer Inc. 11,232 1,189,890
Pharmacia & Upjohn Inc. 8,868 445,063
Pharmerica Inc. 7,216 39,237(a)
Smithkline Beecham PLC ADR 936 51,246
Sun Healthcare Group Inc. 7,476 48,594(a)
Sybron International Corp. 23,351 446,588(a)
Tenet Healthcare Corp. 10,296 296,010(a)
Watson Pharmaceuticals Inc. 16,848 855,036(a)
15,015,121
INSURANCE -- 2.6%
American International Group Inc. 12,845 989,065
Chubb Corp. 7,338 462,294
General Reinsurance Corp. 3,210 651,630
Loews Corp. 8,878 749,081
Marsh & McLennan Cos. Inc. 15,360 764,160
UNUM Corp. 3,753 186,477
3,802,707
- ----------
See Notes to Schedule of Investments and Financial Statements.
30
<PAGE>
GE STRATEGIC INVESTMENT FUND
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
MISCELLANEOUS -- 0.8%
SPDR Trust 11,300 $1,148,363
RETAIL TRADE -- 0.8%
CVS Corp. 10,062 440,841
Home Depot Inc. 15,996 631,842
Sears Roebuck & Co. 936 41,360
1,114,043
TECHNOLOGY - ELECTRONICS & EQUIPMENT -- 1.4%
Applied Materials Inc. 3,412 86,153(a)
Cisco Systems Inc. 9,982 617,012(a)
Hewlett Packard Co. 4,095 216,779
Intel Corp. 11,700 1,003,275
Pitney Bowes Inc. 3,009 158,161
2,081,380
[GRAPHIC OF DISCS OMITTED]
TECHNOLOGY - SOFTWARE & SERVICES -- 4.6%
Automatic Data Processing Inc. 19,801 1,480,125
EMC Corp. 6,023 344,440(a)
Equifax Inc. 49,608 1,770,385
First Data Corp. 62,946 1,479,231
Microsoft Corp. 6,898 759,211(a)
Reuters Holdings PLC ADR 15,861 789,085
6,622,477
TRANSPORTATION -- 0.2%
Pittston Brinks Group 7,818 273,630
UTILITIES -- 2.2%
Airtouch Communications Inc. 39,602 2,257,314(a)
MCI WorldCom Inc. 7,830 382,691(a)
SBC Communications Inc. 13,338 592,708
3,232,713
TOTAL DOMESTIC EQUITY
(COST $51,395,214) 66,121,352
- --------------------------------------------------------------------------------
FOREIGN EQUITY -- 13.7%
- --------------------------------------------------------------------------------
BASIC MATERIALS -- 0.3%
Barlow Ltd. 11,206 41,943
Iscor Ltd. 41,818 9,391
Ispat International N.V. (Regd.)
(Class A) 3,920 29,400
Johnson Matthey PLC 7,469 38,639
Montedison S.p.A 247,652 236,752
Pohang Iron & Steel Co. Ltd. 924 36,332
Shin-Etsu Chemical Co. 5,000 79,243
471,700
[GRAPHIC OF FACTORY OMITTED]
CAPITAL GOODS -- 2.4%
ABB AG 199 202,546
Alstom 8,363 179,214(a)
Desc S.A. de C.V. (Series B) 30,542 23,540
Desc S.A. de C.V. ADR (Class C) 3,930 54,037
FKI PLC 57,332 110,141
Grupo Carso S.A. de C.V. ADR 18,606 102,333
Hyundai Heavy Industries Co. 4,898 73,254
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
Lyonnaise Des Eaux S.A 2,114 $ 360,148
Mannesmann AG 7,096 650,132
Minebea Co. Ltd. 7,000 56,931
Nokia AB Oy (Series A) 7,734 614,522
Preussag AG 1,450 501,437
Siebe PLC 154,557 499,248
VA Technologie AG 998 90,546
3,518,029
[GRAPHIC OF PRODUCTS OMITTED]
CONSUMER - CYCLICAL -- 2.5%
Airtours PLC 70,154 423,404
Autoliv Inc. SDR 11,888 365,551
Canon Inc. 17,000 344,717
Daimler-Benz AG 3,703 309,997
Granada Group PLC 24,883 313,046
Honda Motor Co. 2,000 60,759
Industrie Natuzzi S.p.A. ADR 1,979 39,085
Johnson Electric Holdings 55,600 105,477
Kinnevik AB (Series B) 1,406 36,955
LucasVarity PLC 95,664 294,375
Michelin CGDE (Regd.) (Class B) 2,094 82,267
Philips Electronics N.V 4,721 254,431(a)
Reed International PLC 19,339 163,076
Renault S.A 5,775 231,008
Saatchi & Saatchi PLC 19,926 35,231
SEMA Group PLC 14,874 147,425
Societe Europeene de
Communicion 1,074 6,304(a,m)
Sony Corp. 4,300 298,723
Volkswagen AG 2,528 182,415
3,694,246
CONSUMER - STABLE -- 0.2%
Coca Cola Amatil Ltd. 11,581 30,530
Coca-Cola Beverages PLC 32,218 76,363(a)
Gruma S.A. de C.V. (Series B) 16,822 34,640
Panamerican Beverages Inc. (Class A) 6,536 116,423
San Miguel Corp. S.A 31,910 41,210
299,166
ENERGY -- 1.1%
Coflexip S.A. ADR 6,292 249,320
Elf Aquitaine S.A. ADR 1,590 196,202
Repsol S.A 4,876 206,123
Saipem 48,934 207,517
Total S.A. (Class B) 5,700 718,633
1,577,795
[GRAPHIC OF MONEY OMITTED]
FINANCIAL -- 2.2%
Alpha Credit Bank (Regd.) 1,355 100,764
Argentaria S.A 18,821 374,603
Banca Intesa S.p.A 40,786 171,728
Banco Comercial Portugues (Regd.) 8,956 242,055
Bank of Scotland PLC 17,067 162,923
Bayerische Vereinsbank AG 4,978 366,654
Credito Italiano 54,614 227,634
Den Norske Bank ASA 7,973 25,017
Grupo Financiero Bancomer S.A
ADR (Series C) 22,850 79,975(b)
ING Groep N.V 9,437 425,429
Investor AB (Series B) 839 32,543
Invik & Co. AB 702 50,607
Merita Ltd. (Series A) 38,635 196,803
Metro Bank & Trust Co. 1,040 3,566
- ----------
See Notes to Schedule of Investments and Financial Statements.
31
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
National Bank Greece S.A. GDR 1,098 $ 29,097(b)
Newcourt Credit Group Inc. 2,746 71,105
Societe Generale 1,981 219,333
Sumitomo Realty & Development 13,000 23,791
Uniao de Banco Brasiliero S.A. GDR 4,917 66,380
Zurich Allied AG (Regd.) 531 264,269(a)
3,134,276
[GRAPHIC OF HEALTH SIGN OMITTED]
HEALTHCARE -- 0.7%
Fresenius Medical Care AG 4,324 230,448
Novartis AG (Regd.) 177 284,528
Pliva D D GDR (Regd.) 2,684 35,295
Rhone-Poulenc S.A. (Class A) 5,844 245,248
Shire Pharmaceuticals Group PLC
ADR 5,375 117,578(a)
Teva Pharmaceutical
Industries Ltd. ADR 4,538 171,877
1,084,974
INSURANCE -- 1.3%
Assicurazioni Generali 6,619 215,334
AXA-UAP 5,616 514,484
Commercial Union PLC 11,066 171,483
Muenchener Rueckversicherungs-
Gesellschaft AG (Regd.) 868 383,043
Pohjola Group Insurance Ltd. Co.
(Series B) 1,279 50,561
Royal & Sun Alliance Insurance
Group PLC 38,620 334,855
Sampo Insurance Co.
Ltd. (Series A) 8,033 229,243
1,899,003
RETAIL TRADE -- 0.6%
Carrefour S.A 580 367,795
Giordano International Ltd. 128,000 17,345
Jeronimo Martins, SGPS S.A 3,175 107,635
Koninklijke Ahold N.V 6,308 188,568
Somerfield PLC 17,353 123,170
804,513
TECHNOLOGY - ELECTRONICS & EQUIPMENT -- 1.1%
Brambles Industries Ltd. 15,889 342,971
Cable & Wireless Communication
PLC 28,913 196,620(a)
Comverse Technology Inc. 3,509 143,430(a)
ECI Telecommunications Ltd. 11,075 271,337
Ericson LM Telephone (Series B) 4,739 89,489
NetCom Systems AB (Series B) 3,043 102,113
Schneider S.A 6,251 325,957
Taiwan Semiconductor
Manufacturing Co. 96,000 183,919
1,655,836
[GRAPHIC OF DISCS OMITTED]
TECHNOLOGY - SOFTWARE & SERVICES -- 0.5%
Cap Gemini S.A 3,481 533,358
NTT Data Corp. 48 174,986
708,344
TRANSPORTATION -- 0.3%
IHC Caland N.V 6,187 289,089
Railtrack Group PLC 5,277 152,156
441,245
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
UTILITIES -- 0.5%
Telecom Italia Mobile S.p.A 48,501 $ 282,664
Telecom Italia S.p.A 22,845 157,430
Telecomunicacoes Brasileiras S.A
ADR 1,970 138,762(a)
Vodafone Group PLC 6,932 80,492
659,348
TOTAL FOREIGN EQUITY
(COST $20,319,019) 19,948,475
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
BONDS AND NOTES -- 37.0%
- --------------------------------------------------------------------------------
U.S. TREASURIES -- 9.0%
U.S. Treasury Bonds
12.50% 08/15/14 $ 136,000 223,826
10.625% 08/15/15 356,000 581,558(h)
8.125% 08/15/19 1,435,000 1,965,720
6.125% 11/15/27 471,000 542,974(h)
5.50% 08/15/28 395,000 426,971
3,741,049
U.S. Treasury Notes
5.50% 05/31/00 1,157,000 1,176,519(h)
5.375% 06/30/00 1,324,000 1,345,104
5.125% 08/31/00 1,118,000 1,133,887
5.375% 02/15/01 155,000 158,512
6.625% 07/31/01 753,000 797,239(h)
6.625% 03/31/02 1,011,000 1,083,984
5.375% 06/30/03 120,000 125,494
5.25% 08/15/03 1,020,000 1,065,584
6.625% 05/15/07 617,000 710,802
5.625% 05/15/08 725,000 792,969
8,390,094
U.S. Treasury STRIPS
5.58% 08/15/11 973,000 513,004(d,f)
5.62% 02/15/12 845,000 431,474(d,f)
944,478
TOTAL U.S. TREASURIES
(COST $12,486,701) 13,075,621
FEDERAL AGENCIES -- 6.2%
Federal Home Loan Bank
5.62% 08/10/00 400,000 406,188
6.22% 03/18/08 175,000 183,503
5.75% 04/15/08 515,000 544,453
1,134,144
Federal National Mortgage Assoc.
5.60% 03/27/00 330,000 333,970
5.67% 05/26/00 850,000 862,214
5.56% 07/24/00 565,000 572,859
5.38% 01/16/01 665,000 673,938
5.625% 03/15/01 250,000 256,015
6.41% 07/08/02 200,000 211,374
5.75% 04/15/03 2,135,000 2,227,061
6.99% 07/09/07 855,000 917,654
6.00% 05/15/08 1,075,000 1,158,979
6.16% 08/07/28 495,000 528,611
7,742,675
Small Business Administration
6.55% 10/01/17 - 12/01/17 129,335 136,713
TOTAL FEDERAL AGENCIES
(COST $8,706,896) 9,013,532
- ----------
See Notes to Schedule of Investments and Financial Statements.
32
<PAGE>
GE STRATEGIC INVESTMENT FUND
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
AGENCY MORTGAGE BACKED -- 10.1%
Federal Home Loan Mortgage Corp.
7.50% 06/01/10 $ 257,832 $ 265,985
9.00% 04/01/16 - 07/01/16 101,404 107,908
9.00% 02/01/17 142,140 151,234
9.00% 06/01/21 55,291 58,920(h)
6.50% 04/01/28 - 05/01/28 1,001,834 1,019,987
1,604,034
Federal National Mortgage Assoc.
6.50% 01/01/04 9,588 9,710
8.50% 04/01/17 17,937 18,815(h)
7.00% 06/18/20 125,085 126,063(b)
6.247% 03/25/21 81,000 84,189
6.424% 12/25/23 91,000 95,436
7.00% 10/01/27 - 11/01/27 746,382 768,368
6.50% 03/01/28 - 07/01/28 2,570,267 2,613,628
7.00% 07/01/28 648,019 666,040
6.103% 03/01/33 32,761 33,129(e)
6.154% 11/01/35 504,477 510,152(e)
6.139% 05/01/36 283,369 286,557(e)
6.00% TBA 1,020,000 1,030,200(c)
6,242,287
Federal National Mortgage Assoc. REMIC
7.623% 12/17/04 89,398 95,293(d)
6.225% 05/25/14 32,907 33,709
6.42% 05/25/18 61,000 63,935
192,937
Government National Mortgage Assoc.
7.00% 03/15/12 566,192 583,704
8.50% 10/15/17 1,319,686 1,407,102
7.50% 01/15/23 130,060 134,896
6.50% 02/15/24 - 03/15/24 985,473 1,008,868(b)
7.50% 01/15/28 - 05/15/28 687,292 713,065
6.50% 04/15/28 2,156,151 2,203,975
7.00% 04/15/28 480,376 495,834
6,547,444
TOTAL AGENCY MORTGAGE BACKED
(COST $14,288,856) 14,586,702
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 0.7%
Collateralized Mortgage Obligation Trust
6.82% 09/01/15 18,388 17,325(d,f)
4.78% 11/01/18 33,384 27,980(d,f)
45,305
Federal Home Loan Mortgage Corp.
8.00% 04/15/20 22,520 23,625
6.50% 04/15/28 - 06/15/28 817,000 841,114
864,739
Federal National Mortgage Assoc.
8.50% 03/01/17 - 04/01/17 46,317 8,120(g)
8.50% 01/01/18 5,570 976(g)
9.00% 05/25/22 58,997 11,297(g)
8.50% 07/25/22 77,422 14,246(g)
34,639
Federal National Mortgage Assoc. REMIC
3.40% 07/25/20 43,948 43,423(d,f)
8.00% 10/25/20 44,833 47,901
3.58% 12/25/22 48,984 43,639(d,f)
134,963
TOTAL AGENCY COLLATERALIZED MORTGAGE
OBLIGATIONS
(COST $1,058,756) 1,079,646
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
ASSET BACKED -- 0.3%
Advanta Mortgage Loan Trust Corp.
6.30% 07/25/25 $ 16,195 $ 16,382
Carco Auto Loan Master Trust
6.689% 08/15/04 148,000 152,902
Iroquois Trust
6.752% 06/25/07 141,000 143,512(b)
Provident Bank Home Equity Loan Trust
6.72% 01/25/13 130,953 135,285
TOTAL ASSET BACKED
(COST $431,605) 448,081
CORPORATE NOTES -- 7.6%
Abbey National PLC
7.35% 10/15/06 42,000 46,522
6.70% 06/29/07 55,000 53,144
Applied Materials Inc.
7.125% 10/15/17 40,000 39,978
Bank Austria AG
7.25% 02/15/17 250,000 255,130
Bank of Scotland
7.00% 11/20/07 60,000 61,681(b)
Beckman Instruments Inc.
7.10% 03/04/03 85,000 87,294
Bellsouth Telecomm Inc.
6.375% 06/01/28 75,000 78,765
Black & Decker Holdings Inc.
7.05% 07/01/28 70,000 71,487(b)
Boston University
7.625% 07/15/97 200,000 237,806
Brascan Ltd.
7.375% 10/01/02 60,000 62,582
Carnival Corp.
5.65% 10/15/00 175,000 176,745
Carter Holt Harvey Ltd.
8.875% 12/01/04 200,000 219,760
Circus Circus Enterprises Inc.
6.70% 11/15/03 70,000 66,115
Cleveland Electric Illuminating Co.
7.19% 07/01/00 30,000 30,719
Columbia University Trustees
6.83% 12/15/20 65,000 73,262
Conseco Inc.
6.40% 06/15/01 135,000 136,011
6.80% 06/15/05 70,000 70,926
8.70% 11/15/26 90,000 93,676
Continental Cablevision Inc.
8.50% 09/15/01 70,000 75,629
Corporacion Andina De Fomento
6.75% 03/15/05 130,000 124,050
DDR Pass-Through Asset Trust
7.125% 03/15/02 330,000 335,466(b)
Empresa Nacional De Electricidad
8.125% 02/01/97 65,000 47,475
Energy Group Overseas
7.375% 10/15/17 75,000 76,598
Fairfax Financial Holdings Ltd.
7.375% 04/15/18 100,000 97,531
Federated Department Stores Inc.
6.125% 09/01/01 45,000 45,864
First Security Capital
8.41% 12/15/26 41,000 46,509
Ford Motor Credit Corp.
7.32% 05/23/02 187,000 188,870(a)
Fujian International Trust & Investment Corp.
7.375% 08/25/07 65,000 33,996(b)
- ----------
See Notes to Schedule of Investments and Financial Statements.
33
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Goldman Sachs Group L.P.
6.20% 12/15/00 $ 100,000 $ 102,802(b)
Guangdong International Trust &
Investment Corp.
8.75% 10/24/16 50,000 25,789(b)
Heritage Media Corp.
8.75% 02/15/01 90,000 96,750
Household Finance Corp.
6.125% 07/15/02 40,000 40,600
Hydro-Quebec
8.05% 07/07/24 95,000 113,714
8.25% 04/15/26 50,000 60,944
International Lease Finance Corp.
5.62% 02/01/00 250,000 252,035
Israel Electric Corp. Ltd.
7.125% 07/15/05 50,000 51,246(b)
8.10% 12/15/96 25,000 25,531(b)
Korea Development Bank
7.125% 09/17/01 70,000 61,111
6.625% 11/21/03 75,000 58,103
Landeskreditbank Baden
7.875% 04/15/04 40,000 45,399
Lasmo USA Inc.
6.75% 12/15/07 95,000 93,977
LCI International Inc.
7.25% 06/15/07 49,000 50,074
Lehman Brothers Holdings Inc.
6.90% 03/30/01 35,000 35,012
8.05% 01/15/19 80,000 80,600
7.50% 08/01/26 115,000 116,731
Liberty Property Ltd. Partnership
7.50% 01/15/18 70,000 66,543
Loewen Group International Inc.
6.70% 10/01/99 300,000 290,250(b)
7.50% 04/15/01 180,000 170,775
Long Island Lighting
7.30% 07/15/99 80,000 80,806
MBNA Corp.
6.306% 04/22/03 150,000 155,365
MCI Communications Corp.
6.125% 04/15/02 200,000 205,014
Meditrust
7.114% 08/15/04 100,000 89,125
MIC Financing Trust
8.375% 02/01/27 130,000 136,662(b)
Morgan Stanley Finance PLC
8.03% 02/28/17 40,000 43,300
Nabisco Inc.
6.125% 02/01/03 70,000 70,312
National Rural Utilities Cooperative
6.046% 04/15/03 100,000 103,658
National Westminster Bank PLC
7.75% 04/29/07 35,000 37,488
New Jersey Economic Development
Authority
7.425% 02/15/29 65,000 77,244
News America Holdings Inc.
8.15% 10/17/36 210,000 233,822
Niagara Mohawk Power Corp.
9.50% 06/01/00 80,000 84,449
Norfolk Southern Corp.
7.90% 05/15/97 138,000 162,234
North Atlantic Energy Corp.
9.05% 06/01/02 77,000 80,225
NRG Energy Inc.
7.50% 06/15/07 160,000 172,000
NWCG Holding Corp.
5.29% 06/15/99 120,000 115,742(d)
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Ontario Province of Canada
6.125% 06/28/00 $ 250,000 $ 255,302
Oryx Energy Co.
10.00% 06/15/99 100,000 102,845
9.50% 11/01/99 75,000 78,040
Paramount Communications Inc.
5.875% 07/15/00 150,000 151,665
Philip Morris Cos. Inc.
7.25% 09/15/01 60,000 62,846
7.20% 02/01/07 30,000 32,500
Reliance Industries Ltd.
10.50% 08/06/46 30,000 23,100(b)
Republic of Columbia
7.25% 02/15/03 35,000 31,838
Republic of Panama
7.875% 02/13/02 50,000 45,000(b)
Riggs Capital Trust
8.625% 12/31/26 40,000 42,226(b)
RJR Nabisco Inc.
8.00% 07/15/01 125,000 127,636
7.625% 09/15/03 50,000 49,555
St. George Funding Co.
8.485% 12/31/49 180,000 181,575(b)
Stop & Shop Cos. Inc.
9.75% 02/01/02 40,000 42,600
Sun Life Canada Capital Trust
8.526% 05/29/49 95,000 102,778(b)
Sunamerica Inc.
5.60% 07/31/97 150,000 126,952
Suntrust Banks Inc.
6.00% 01/15/08 60,000 62,165
TCI Communications Inc.
8.65% 09/15/04 85,000 98,062
Tele-Communications Inc.
9.80% 02/01/12 125,000 167,089
Tenet Healthcare Corp.
7.875% 01/15/03 60,000 60,900
8.00% 01/15/05 25,000 25,375
Time Warner Inc.
4.90% 07/29/99 100,000 99,484(b)
6.10% 12/30/01 180,000 183,193(b)
Transamerica Capital III
7.625% 11/15/37 100,000 106,000
Turner Broadcasting Systems Inc.
8.375% 07/01/13 90,000 102,410
Tyco International Group S.A.
6.25% 06/15/03 85,000 88,013
7.00% 06/15/28 305,000 319,128
United Illuminating Co.
6.25% 12/15/02 25,000 25,362
United Parcel Service Inc.
8.375% 04/01/30 115,000 146,431
US West Capital Funding Inc.
6.125% 07/15/02 30,000 31,001
6.875% 07/15/28 45,000 47,703
USA Waste Services Inc.
6.125% 07/15/01 250,000 254,722
USX Marathon Group
9.80% 07/01/01 60,000 65,824
8.125% 07/15/23 60,000 64,392
Washington Mutual Capital
8.375% 06/01/27 65,000 71,920
Waterford Funding Corp.
8.09% 01/02/17 200,000 221,786
Westdeutsche Landesbank
6.75% 06/15/05 100,000 106,809
Westinghouse Electric Corp.
8.875% 06/01/01 40,000 42,689
Williams Cos. Inc.
6.125% 02/15/02 120,000 121,813
- ----------
See Notes to Schedule of Investments and Financial Statements.
34
<PAGE>
GE STRATEGIC INVESTMENT FUND
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Worldcom Inc.
6.125% 08/15/01 $ 55,000 $ 56,269
6.40% 08/15/05 85,000 89,694
8.875% 01/15/06 100,000 109,696
6.95% 08/15/28 35,000 36,874
Yale University Notes
7.375% 04/15/96 65,000 78,307
Zurich Capital Trust
8.376% 06/01/37 40,000 43,753(b)
TOTAL CORPORATE NOTES
(COST $10,775,006) 11,002,345
NON-AGENCY MORTGAGE BACKED SECURITIES -- 2.5%
Amresco Commercial Mortgage Funding Corp.
6.73% 06/17/29 85,902 88,399
Asset Securitization Corp.
6.50% 12/14/02 71,153 73,154
BHN Mortgage Trust
7.54% 04/30/07 61,174 40,375(b)
7.916% 02/15/12 31,246 21,247(b)
DLJ Mortgage Acceptance Corp.
6.14% 10/15/06 91,931 94,258
6.41% 02/15/08 246,000 256,455
6.65% 12/17/27 26,430 27,198(b)
First Union Lehman Brothers Bank
6.28% 11/15/35 316,931 326,835
GS Mortgage Securities Corp.
5.58% 07/13/30 117,000 124,056(d)
Merrill Lynch Mortgage Investors Inc.
6.36% 11/15/26 291,000 302,958
Mid State Trust
6.96% 07/01/25 28,590 29,546(d)
Morgan Stanley Capital Inc.
6.52% 01/15/08 204,000 217,196
6.476% 10/15/10 107,871 110,821(b)
6.86% 07/15/29 126,969 134,111(b)
6.54% 07/15/30 315,000 330,799
6.70% 10/03/30 47,750 49,995
Salomon Brothers Mortgage
Securities Inc.
7.00% 10/01/27 222,283 217,862
Sawgrass Finance REMIC Trust
6.45% 01/20/06 60,000 61,266
Structured Asset Securities Corp.
5.65% 09/25/99 12,544 12,537(b)
6.256% 08/25/00 533,753 527,582(b)
8.495% 04/25/27 90,427 93,931
6.79% 11/01/27 72,486 75,861
0.49% 02/25/28 752,843 41,642(d,g)
Vornado Finance Corp.
6.36% 12/01/00 355,000 361,989(b)
TOTAL NON-AGENCY MORTGAGE BACKED SECURITIES
(COST $3,571,255) 3,620,073
NON-AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 0.6%
BlackRock Capital Financial
7.22% 11/25/28 255,000 263,527
7.25% 11/25/28 151,264 144,977
5.476% 11/25/38 96,612 99,269
Residential Assets Securitization Trust
7.75% 04/25/27 - 06/25/27 251,370 261,315(a)
7.50% 08/25/27 140,200 144,450(a)
TOTAL NON-AGENCY COLLATERALIZED
MORTGAGE OBLIGATIONS
(COST $897,986) 913,538
TOTAL BONDS AND NOTES
(COST $52,217,061) 53,739,538
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
PREFERRED STOCK -- 0.6%
- --------------------------------------------------------------------------------
DOMESTIC PREFERRED -- 0.5%
Coastal Financial Corp., 8.375% 1,200 $ 29,700
Microsoft Corp.
(Series A), $2.20 3,613 348,203
New Plan Realty Trust,
8.625% 1,915 92,399
News Corp. Exchange Trust, 5.00% 680 43,520(a,b)
Simon DeBartolo Group Inc.
(Series C), 7.89% 1,455 68,021
TCI Communications Inc., 10.00% 2,800 76,475
658,318
INTERNATIONAL PREFERRED -- 0.1%
Banesto Holdings Ltd. (Series A),
10.50% 2,400 75,600(a,b)
Fresenius Medical Care AG 878 33,123
Telecomunicacoes de
Rio de Janiero S.A. 513,300 14,505
Telerj Celular S.A. 1,122,832 23,206(a)
146,434
TOTAL PREFERRED STOCK
(COST $878,841) 804,752
- --------------------------------------------------------------------------------
WARRANTS -- 0.0%
- --------------------------------------------------------------------------------
Muenchener Rueckversicherungs-
Gesellschaft AG, 06/03/02
(COST $0) 27 1,067
TOTAL INVESTMENTS IN SECURITIES
(COST $124,810,135) 140,615,184
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 3.0%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $4,298,512) 4,298,512 4,298,512
NUMBER
EXPIRATION DATE/ OF
STRIKE PRICE CONTRACTS VALUE
- --------------------------------------------------------------------------------
CALL OPTIONS -- 0.0%
- --------------------------------------------------------------------------------
U.S. Treasury Notes Oct 98/110.09 (725) (3,058)
U.S. Treasury Notes Oct 98/107.88 (395) (4,629)
(WRITTEN OPTION PREMIUM $(4,663)) (7,687)
- --------------------------------------------------------------------------------
PUT OPTIONS -- 0.0%
- --------------------------------------------------------------------------------
U.S. Treasury Bonds Oct 98/102.92 (700) (0)
U.S. Treasury Notes Oct 98/107.01 (725) (3,285)
U.S. Treasury Notes Oct 98/101.88 (395) (62)
(WRITTEN OPTION PREMIUM $(7,108)) (3,347)
OTHER ASSETS AND LIABILITIES,
NET 0.2% 287,705
================================================================================
NET ASSETS -- 100% $145,190,367
================================================================================
[GRAPHIC OMITTED]
ICONS REPRESENT THE TOP FIVE COMBINED INDUSTRY WEIGHTINGS FOR THE DOMESTIC AND
FOREIGN EQUITIES IN THE GE STRATEGIC INVESTMENT FUND AS OF SEPTEMBER 30, 1998.
- ----------
See Notes to Schedule of Investments and Financial Statements.
35
<PAGE>
GE TAX-EXEMPT FUND
Q&A
Barbara A. Brinkley, a Manager of Brown Brothers Harriman and Co. and a member
of its U.S. Bond Policy Group and its Fixed Income Credit Committee, is the
Portfolio Manager of the GE Tax-Exempt Fund. Ms. Brinkley has been employed by
Brown Brothers since 1976. Total assets under Brown Brothers management exceed
$29 billion. Throughout her career with Brown Brothers, and during her previous
four years with American Re-Insurance Company, Ms. Brinkley has specialized as a
municipal bond credit analyst, trader and portfolio manager. Ms. Brinkley is a
member and former chairman of the Municipal Analysts Group of New York, and is a
member of the Fixed Income Analysts Society, Inc. Ms. Brinkley holds a B.A.
degree from Smith College.
Q. HOW DID THE GE TAX-EXEMPT FUND'S INDUSTRY BENCHMARK AND LIPPER PEERS
PERFORM FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. The Lehman Brothers 10-Year General Obligation Municipal Bond Index
returned 9.02% for the one-year period ended September 30, 1998. Our Lipper
peer group of 329 Intermediate Municipal Bond funds posted an average
return of 6.99% for the same period. To see how your class of shares in the
GE Tax-Exempt Fund performed compared to the aforementioned benchmarks,
please refer to the following page.
Q. WHAT DROVE THE FUND'S PERFORMANCE?
A. The fund's performance was influenced by two major events: 1) yield
movements during the year; and 2) the escrow-to-maturity bond market. The
fund is positioned to generate greater tax-free income than money market
funds but with a shorter duration than longer term funds, which are
susceptible to greater price fluctuations. As yields fell during the fiscal
year, the fund's performance benefited from its intermediate and longer
maturity bond holdings. However, the price return experienced by the fund
was less than that of the benchmark index, which has a longer duration.
Yields between credit quality bonds also narrowed throughout the year and
investors moved to bonds with lower credit quality in search of higher
yields. The fund's benchmark index, which has lower credit quality bond
components, particularly benefited from this spread compression. Since our
portfolio is managed conservatively and therefore holds higher credit
quality bonds than in the benchmark index, the fund generated lower yields.
The fund's performance was also hurt by our holdings of escrow-to-maturity
("ETM") bonds. In late April, the Gainesville, Florida Utility Authority
announced its intention to call $280 million of ETM bonds. As investors
viewed these securities as non-callable, the announcement shook the ETM
bond market and prices of these bonds fell. In June, the issuer announced
that it was withdrawing the attempted call. Subsequently, ETM bond prices
have regained some of their former values, however, the episode unnerved
investors and ETM bonds never recovered sufficiently to fully participate
in the price gains experienced by the general bond market. Ultimately, we
continue to believe that these bonds will produce sustainable high
tax-exempt income, and are a very attractive component of our portfolio.
Q. WHAT HAS YOUR INVESTMENT STRATEGY BEEN?
A. The fund has been neutral in its duration stance for much of the year,
expecting interest rates to fluctuate narrowly. As the emerging markets
turmoil started to spill over into the domestic markets, we began
anticipating that interest rates would move lower over the coming months.
On September 24, 1998, we lengthened the fund's duration. Our strategy has
been to purchase securities in the 7-18 year maturity range, which we
believe best balances opportunity and risk. These maturities lock in high
tax-free yields, and will benefit the fund if interest rates continue to
fall and from downward movements along the yield curve. We emphasize call
protection premium coupon bonds, and issuers that are fully backed by U.S.
Government securities held in escrow by the bond trustee. These bonds are
of the highest credit quality, and are immune to any changes in the
issuer's economy or repayment ability.
Q. WHAT IS THE OUTLOOK FOR THE FUND?
A. U.S. economic growth is beginning to show signs of slowing as the global
economy and dislocated market confidence chips away at U.S. exports,
business investment and consumer confidence. With financial land mines
going off among a wide range of intermediaries, the Federal Reserve has
initiated what we expect will be a series of rate reductions.
Reflecting our moderately bullish view that municipal rates are set to move
lower, the fund's average duration has been extended somewhat to capture
the expected positive price movement, and the fund's holdings are
concentrated in call-protected maturities in the 7-18 year range, in order
to sustain a high level of income exempt from federal taxation.
[picture of Barbara A. Brinkley Omitted]
36
<PAGE>
GE TAX-EXEMPT FUND
======================================================================
QUALITY RATINGS
AT SEPTEMBER 30, 1998
======================================================================
Percent of
Moody's Ratings++ Market Value
- ----------------------------------------------------------------------
Aaa 86.1%
Aa 8.4%
A 4.7%
Baa 0.8%
- ----------------------------------------------------------------------
100.0%
++ Moody's Investors Service, Inc. is a nationally recognized statistical
rating organization.
INVESTMENT PROFILE
A mutual fund designed for investors who seek a high level of current
income exempt from federal income taxes while preserving capital by
investing primarily in tax-exempt debt obligations.
* LIPPER PERFORMANCE COMPARISON
Intermediate Municipal Debt Peer Group
Based on average annual total
returns for the periods ended 9/30/98
One Three Five
Year Year Year
Number of Funds
in peer group: 329 267 167
Peer group
average annual
total return: 6.99% 6.11% 5.12%
Lipper categories in peer group: Intermediate Municipal Debt,
including single state Funds
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- ----------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A
W/O LOAD W/LOAD LB 10 YEAR GO BOND
8/93 10000 9575 10000
9/93 10030.21 9603.93 10125
10162.36 9730.46 10277.54
9724.93 9311.62 9710.26
9794.65 9378.38 9853.84
9/94 9883.82 9463.75 9917.7
9793.39 9377.17 9755.27
10427.05 9983.9 10446.56
10613.47 10162.4 10709.77
9/95 10813.77 10354.18 11087.72
11289.22 10809.43 11426.93
11110.74 10638.54 11372.75
11208.4 10732.04 11386.87
9/96 11508.82 11019.69 11626.07
11742.69 11243.63 11971.57
11833.68 11330.75 11966.21
12101.14 11586.85 12377.44
9/97 12403.79 11876.63 12753.05
12590.07 12054.99 13077.91
12705.81 12165.81 13221.72
12836.42 12290.87 13426.97
9/98 13185 12626 13903.97
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Tax-Exempt 6.33% 5.62% 5.61%
GE Tax-Exempt w/load 1.78% 4.71% 4.71%
(maximum load-4.25%)
LB 10 Yr. GO Muni Bond 9.02% 6.55% 6.72%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
W/O LOAD W/LOAD LB 10 YEAR GO BOND
8/93 10000 10000 10000
9/93 10034.24 10034.24 10125
10146.76 10146.76 10277.54
9682.67 9682.67 9710.26
9742.67 9742.67 9853.84
9/94 9826.66 9826.66 9917.7
9736.87 9736.87 9755.27
10366.28 10366.28 10446.56
10560.87 10560.87 10709.77
9/95 10759.89 10759.89 11087.72
11222.51 11222.51 11426.93
11045.21 11045.21 11372.75
11152.07 11152.07 11386.87
9/96 11450.52 11450.52 11626.07
11672.73 11672.73 11971.57
11763.04 11763.04 11966.21
12026.41 12026.41 12377.44
9/97 12305.35 12305.35 12753.05
12474.52 12474.52 13077.91
12573.35 12573.35 13221.72
12671.61 12671.61 13426.97
9/98 13000 13000 13903.97
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Tax-Exempt 5.68% 5.31% 5.32%
GE Tax-Exempt w/load 2.68% 5.16% 5.32%
maximum load 3.0% 1.0% 0.0%
LB 10 Yr. GO Muni Bond 9.02% 6.55% 6.72%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS C
W/O LOAD LB 10 YEAR GO BOND
9/26/97 10000 10000
9/29/97 10001.23 10000
9/30/97 10010.94 10000
12/31/97 10168 10254.73
3/31/98 10276 10367.49
6/30/98 10377 10528.43
9/30/98 10663 10902.46
AGGREGATE
TOTAL RETURN
ONE SINCE
YEAR INCEPTION
GE Tax-Exempt 6.48% 6.55%
LB 10 Yr. GO Muni Bond 9.02% 9.02%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS D W/O LOAD LB 10 YEAR GO BOND
9/26/97 10000 10000
9/29/97 9992.96 10000
9/30/97 10002.63 10000
12/31/97 10175 10254.73
3/31/98 10291 10367.49
6/30/98 10441 10528.43
9/30/98 10744 10902.46
AGGREGATE
TOTAL RETURN
ONE SINCE
YEAR INCEPTION
GE Tax-Exempt 7.30% 7.36%
LB 10 Yr. GO Muni Bond 9.02% 9.02%
Legend as Follows:
GE Tax Exempt Fund
GE Tax Exempt Fund w/load
LB 10 Yr. GO Muni Bond
37
<PAGE>
GE TAX-EXEMPT FUND
GE TAX-EXEMPT FUND
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Cash & Other 1.1%
Lease & Pollution Control 2.5%
Sales Tax 6.6%
General Obligation 7.1%
Education 8.0%
Transportation 8.0%
Water & Sewer 10.2%
Housing 16.4%
Hospital 19.8%
Utilities 20.3%
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
MUNICIPAL BONDS -- 98.9%
- --------------------------------------------------------------------------------
ARKANSAS -- 4.5%
Arkansas Housing Development
Agency Rev. - Housing
8.375% 07/01/10 $ 370,000 $ 466,008(i)
8.375% 07/01/11 305,000 420,403(i)
Pulaski County Arkansas Hospital
Rev. - Health
9.25% 03/01/10 195,000 253,874(i)
1,140,285
CALIFORNIA -- 5.1%
Sacramento California Utility
Rev. - Electric Utility
9.00% 04/01/13 670,000 928,379(i)
San Diego California Hospital
Rev. - Health
8.875% 02/01/11 280,000 362,939(i)
1,291,318
COLORADO -- 3.7%
Colorado Springs Colorado Utility
Rev. - Electric Utility
8.50% 11/15/11 100,000 132,853(i)
Denver Colorado City & County,
Housing Finance Authority - Housing
7.00% 08/01/10 510,000 599,245(i)
Loveland Cnty Rev. - Water & Sewer
8.875% 11/01/05 165,000 204,169(i)
936,267
[GRAPHIC OF STATE OF CONNECTICUT OMITTED]
CONNECTICUT -- 7.4%
Connecticut State Health &
Educational Fac. Auth. Rev. - Health
5.50% 07/01/12 500,000 546,530(k)
7.00% 07/01/12 765,000 900,948(i)
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Connecticut State Housing Finance
Auth. Rev. - Housing
6.05% 05/15/14 $ 410,000 $ 439,241
1,886,719
FLORIDA -- 2.9%
Dade County Florida Special
Obligation - Special Tax
8.625% 12/01/07 140,000 180,439(i,k)
Florida State Broward County G.O.
10.00% 07/01/14 235,000 365,636
Gainesville Florida Utilities Systems
Rev. - Electric Utility
8.125% 10/01/14 175,000 199,206(i)
745,281
GEORGIA -- 2.1%
Clarke County Georgia Hospital
Auth. Rev. - Health
9.875% 01/01/06 80,000 103,742(i,k)
Columbus Georgia Medical Center
Hospital Auth. Rev. - Health
7.75% 07/01/10 305,000 377,312(i)
Metropolitan Rapid Transportation
Auth. - Transportation
7.00% 07/01/11 50,000 62,506(i)
543,560
IDAHO -- 3.2%
Idaho Falls Idaho Electric Rev. -
Electric Utility
10.375% 04/01/07 570,000 824,442(j)
ILLINOIS -- 0.2%
Chicago Illinois Motor Fuel Tax
Rev. - Sales Tax
6.50% 01/01/01 20,000 21,232(j,k)
Chicago Illinois Wastewater
Treatment Rev. - Water & Sewer
6.30% 01/01/03 20,000 22,273(j,k)
43,505
INDIANA -- 1.8%
Indiana State Toll Road Commission
Rev. - Transportation
9.00% 01/01/15 105,000 152,420(i)
Indiana University Rev. - Education
6.00% 11/15/14 290,000 316,283
468,703
IOWA -- 4.9%
Muscatine Iowa Electric Rev. - Electric Utility
9.70% 01/01/13 865,000 1,232,530(i)
LOUISIANA -- 2.6%
Jefferson Parish Louisiana Hospital
Rev. - Health
7.25% 01/01/09 575,000 668,345(i)
MAINE -- 0.0%
Maine Municipal Bond Bank G.O.
7.10% 11/01/99 10,000 10,588(j)
38
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
[GRAPHIC OF STATE OF MASSACHUSETTS OMITTED]
MASSACHUSETTS -- 6.1%
Massachusetts State G.O.
6.75% 08/01/09 $ 90,000 $ 98,737(k)
5.25% 08/01/15 500,000 530,480
Massachusetts State Port Auth.
Rev. - Trans.
13.00% 07/01/13 535,000 928,305(i)
1,557,522
[GRAPHIC OF STATE OF MICHIGAN OMITTED]
MICHIGAN -- 5.6%
Michigan State Hospital Finance Auth.
Rev. - Health
9.00% 05/01/08 595,000 783,175(i)
7.125% 05/01/09 545,000 632,843(i)
1,416,018
MINNESOTA -- 1.3%
Rochester Minnesota Health Care
Facilities Rev. - Health
6.25% 11/15/14 300,000 329,970
MISSISSIPPI -- 2.6%
Mississippi State G.O.
6.20% 02/01/08 580,000 666,710(i)
MISSOURI -- 0.1%
Lees Summit Missouri Water & Sewer
Rev. - Water & Sewer
10.00% 07/01/00 20,000 22,144(j,k)
NEW JERSEY -- 2.5%
Atlantic City New Jersey Improvement
Auth. Rev. - Lease Rev.
7.40% 03/01/12 270,000 339,395(i,k)
New Jersey State Tpke. Auth.
Rev. - Trans.
6.50% 01/01/16 250,000 306,290(k)
645,685
NEW MEXICO -- 0.7%
Farmington New Mexico Utility Systems
Rev. - Electric Utility
9.875% 01/01/08 125,000 165,305(i,k)
[GRAPHIC OF STATE OF NEW YORK OMITTED]
NEW YORK -- 14.6%
New York City Transitional Finance
Auth Rev. - Sales Tax
5.00% 08/15/16 450,000 457,339
Erie County New York Water Auth.
Rev. - Water & Sewer
6.00% 12/01/08 400,000 449,604(i,k)
Long Island Power Authority New York
Electric System - Electric Utility
5.75% 12/01/24 200,000 216,538
New York New York G.O.
6.00% 08/01/06 300,000 306,456(i,k)
New York New York G.O. - VRDN
4.10% 08/01/18 100,000 100,000
4.25% 10/01/23 200,000 200,000
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
New York State Dormitory Auth.
Rev. - Education
7.50% 05/15/11 $ 165,000 $ 206,678
5.20% 02/15/16 200,000 204,910
7.375% 07/01/16 640,000 818,803(i)
5.00% 05/15/17 500,000 502,500
New York State Environmental
Facilities Rev. - Water & Sewer
6.80% 11/15/10 200,000 230,562
3,693,390
NORTH CAROLINA -- 5.4%
North Carolina Municipal Power
Rev. - Electric Utility
10.50% 01/01/10 990,000 1,373,882(i)
OHIO -- 4.2%
Columbus Ohio G.O.
6.00% 07/01/02 50,000 54,836(j)
Ohio State Higher Educational
Rev. - Education
6.00% 05/15/09 550,000 625,658(k)
Ohio State Water Development
Auth. Rev. - Water & Sewer
7.00% 12/01/09 325,000 389,122(i,k)
1,069,616
[GRAPHIC OF STATE OF PENNSYLVANIA OMITTED]
PENNSYLVANIA -- 9.0%
Allegheny County Pennsylvania
Hospital Development Rev. - Health
7.375% 07/01/12 315,000 389,296(i)
Pennsylvania Intergovernmental
Co-op. - Special Tax
5.60% 06/15/15 500,000 527,950(k)
Philadelphia Pennsylvania
Hospital Rev. - Health
9.875% 07/01/05 505,000 679,710(j)
Pittsburgh Pennsylvania Water &
Sewer Rev. - Water & Sewer
7.25% 09/01/14 555,000 692,590(i,k)
2,289,546
PENNSYLVANIA & NEW JERSEY -- 1.5%
Delaware River Port Authority
Pennsylvania & New Jersey - Trans.
6.50% 01/15/11 330,000 376,197(i)
TEXAS -- 2.5%
Austin Texas Utility Systems
Rev. - Electric Utility
7.25% 11/15/98 50,000 51,241(j)
Houston Texas Sewer Systems
Rev. - Water & Sewer
9.375% 10/01/13 65,000 94,791(i,k)
Laredo Texas International Toll
Bridge Rev. - Transportation
5.00% 10/01/17 500,000 504,900(k)
650,932
UTAH -- 0.0%
Intermountain Power Agency Utah
Rev. - Electric Utility
7.20% 07/01/99 10,000 10,482(j)
- ----------
See Notes to Schedule of Investments and Financial Statements.
39
<PAGE>
GE TAX-EXEMPT FUND
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
VIRGINIA -- 0.5%
Richmond Virginia Metropolitan
Expressway Auth. Rev. - Trans.
7.00% 10/15/13 $ 115,000 $ 133,837(i,k)
WASHINGTON -- 0.1%
Snohomish County Washington
Public Utility Rev. - Electric Utility
6.375% 01/01/05 20,000 22,645(i)
WEST VIRGINIA -- 0.9%
Wood County West Virginia Building
Commission - St. Joseph
Hospital - Health
6.625% 01/01/06 215,000 232,985(i,k)
PUERTO RICO -- 2.9%
Puerto Rico Commonwealth Aquaduct
& Sewer Rev. - Water & Sewer
10.25% 07/01/09 535,000 731,522(i)
TOTAL INVESTMENTS IN SECURITIES
(COST $23,738,319) 25,179,931
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 0.1%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $17,323) 17,323 17,323
OTHER ASSETS AND LIABILITIES, NET 1.0% 256,347
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $25,453,601
================================================================================
- ----------
See Notes to Schedule of Investments and Financial Statements.
[GRAPHIC OMITTED]
ICONS REPRESENT THE TOP FIVE STATE WEIGHTINGS IN THE
GE TAX-EXEMPT FUND AS OF SEPTEMBER 30, 1998.
40
<PAGE>
GE FIXED INCOME FUNDS
- --------------------------------------------------------------------------------
Q&A
Robert MacDougall leads the fixed income team at GE Investments. Assets under
management exceed $29 billion. His responsibilities include leading a team of
managers for the GE Fixed Income, GE Short-Term Government, GE Government
Securities and GE Money Market Funds. Bob joined GE Investments in 1986 as a
Mutual Fund Portfolio Manager and was appointed to head the taxable Fixed Income
team in 1992, and the tax-exempt Fixed Income team in 1998. Previously he was
with GE's Corporate Treasury Operation managing the Company's $2 billion
portfolio of marketable securities and supporting the Treasurer in the areas of
debt management and capital structure planning. Prior to that, Bob has held
various financial management positions since joining GE in 1973. He holds
Bachelor's and Master's degrees in Business Administration from the University
of Massachusetts.
Q. DESCRIBE WHAT HAPPENED IN THE FIXED INCOME MARKETS DURING THE ONE-YEAR
PERIOD ENDED SEPTEMBER 30, 1998.
A. The past twelve months have seen a significant rally in the bond market.
Yields on the 30-Year U.S. Treasury Bonds fell 107 basis points (1.07%)
from 6.04% to 4.97%. Similar declines occurred in Treasuries of shorter
maturities as well. During the first half of the year the Federal Reserve,
concerned about the tight labor market, had a bias to raise interest rates
to help slow the economy and prevent an acceleration of inflation.
Uncertainty about the impact of the Asian crisis and whether it would
spread to other regions of the world kept them on the sidelines. As the
Asian financial crisis worsened and spread to Russia and Latin America,
investors were increasingly attracted to the U.S. Treasury market's
quality, liquidity and value. Signs of a slowing of domestic economic
activity and continued low inflation, together with the global market
turmoil, prompted the Federal Reserve to ease monetary policy in late
September.
Not all sectors of the fixed income market fared as well, however.
Declining interest rates caused many homeowners to refinance their
mortgages. This had a dampening effect on the price performance of
securities backed by home mortgages. The mortgage sector, as measured by
the Lehman Brothers Mortgage Index, returned 7.31% for the twelve months
ended September 1998 compared with a 10.75% return for the Treasury index.
While mortgage backed securities were affected by "prepayment" risk (the
uncertainty about the cash flow due to the prepayment option granted to
homeowners), corporate and other non-U.S. government bonds were hit with
fears of "repayment" risk. For years investors have increasingly "reached
for yield" by buying lower rated corporates and driving credit spreads
tighter and tighter. After the Russian debt default in August, the markets
reassessed - and repriced - the credit risk premiums in the corporate bond
market. Lower quality bonds were sold in favor of high quality U.S.
Treasuries. This "flight to quality" pushed corporate yields up while
driving Treasury yields down. The yield differential, or spread, widened in
some cases to levels not seen since the 1990-91 recession. Emerging market
debt declined 24% while high yield corporate bonds eked out a 1.7% return
over the past year. Over the life of a bond its return is generally equal
to its yield (barring a default). During the past couple of months there
has been an inverse correlation between yield and return. The lowest
yielding sectors (Treasuries) outperformed higher yielding corporates and
mortgages.
GE Fixed Income Fund
Q. HOW DID THE GE FIXED INCOME FUND'S BENCHMARK AND LIPPER PEER GROUP PERFORM
FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. The Lehman Brothers Aggregate Bond Index returned 11.50% while the average
return for the 129 Intermediate U.S. Government Bond funds tracked by
Lipper was 10.74%. To see how your class of shares in the GE Fixed Income
Fund performed compared to these benchmarks, please refer to page 43.
Q. WHAT WERE THE KEY DRIVERS OF FUND PERFORMANCE?
A. Our strategy was to hold a portfolio which yielded more than the benchmark
and was well diversified as to sectors and issuers. During the last couple
of months, this approach did not provide the results we anticipated. Our
holdings of government agency mortgage backed securities and our
lower-rated corporate bond positions underperformed. Partially offsetting
that was a positive contribution from having an average duration (interest
rate exposure) longer than the index. Overall, however, the returns were
clearly higher than we would have expected to achieve when the year began.
[picture of Robert MacDougall Omitted]
41
<PAGE>
GE FIXED INCOME FUNDS (CONTINUED)
Q&A
GE Government Securities Fund
Q. HOW DID THE GE GOVERNMENT SECURITIES FUND'S MARKET BENCHMARK AND LIPPER
PEER GROUP PERFORM FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. The Lehman Brothers Government Bond Index returned 13.60% while the average
return for the 129 Intermediate U.S. Government Bond funds tracked by
Lipper was 10.74%. To see how your class of shares in the GE Government
Securities Fund performed compared to these benchmarks, please refer to
page 48.
Q. WHAT WERE THE KEY DRIVERS OF FUND PERFORMANCE?
A. During this period, the fund maintained an average maturity longer than its
benchmark which added to the fund's performance. However, this positive
performance was overshadowed by our sector allocation to mortgage-backed,
asset backed and corporate securities which were negatively impacted as a
result of the market pricing in higher risk premiums.
GE Short-Term Government Fund
Q. HOW DID THE GE SHORT-TERM GOVERNMENT FUND'S MARKET BENCHMARK AND LIPPER
PEER GROUP PERFORM FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. The Lehman Brothers 1 - 3 Year Government Bond Index returned 7.93% while
the average return for the 201 Short Term U.S. Government Bond funds
tracked by Lipper was 7.69%. To see how your class of shares in the GE
Short-Term Government Fund performed compared to these benchmarks, please
refer to page 51.
Q. WHAT WERE THE KEY DRIVERS OF FUND PERFORMANCE?
A. Early in 1998, we positioned the fund for a rally by extending the average
maturity of the fund and lowering our exposure to mortgage backed
securities, which are not in the market index. Our longer duration enhanced
fund performance throughout the year as U.S. Treasury securities have
marched to the lowest yields in a generation. Callable securities, like
mortgage-backed securities, have been a drag on fund performance during the
market rally of late. New lows in mortgage rates have set off a wave of
home refinancings that has caused mortgage-backed securities to
underperform U.S. Treasury securities.
GE Money Market Fund
Q. HOW DID THE GE MONEY MARKET FUND'S MARKET BENCHMARK AND LIPPER PEER GROUP
PERFORM FOR THE ONE-YEAR PERIOD ENDED SEPTEMBER 30, 1998?
A. The 90-day U.S. Treasury Bill returned 5.08% while the average return for
the 303 Money Market funds tracked by Lipper was 4.93%. To see how your
shares in the GE Money Market Fund performed compared to these benchmarks,
please refer to page 54.
Q. WHAT WERE THE KEY DRIVERS OF FUND PERFORMANCE?
A. While the Federal Reserve waited until the end of September to ease
monetary policy, the markets did not. The money market yield curve became
inverted, as shorter maturities yielded more than longer maturities. By
holding our average maturity shorter than the peer funds we were able to
capture these higher rates.
Q. WHAT IS YOUR OUTLOOK FOR THE BOND MARKET?
A. With bond yields at multi-year and, in some cases, record lows, it is
difficult to expect further declines. Having said that, however, bonds
continue to offer good value on both a fundamental (real) basis as well as
on a relative (to other asset classes) basis. Inflation remains low and
well controlled, fiscal policy is supportive and monetary policy has been
effective. The widening of mortgage and credit spreads has presented many
opportunities for value in those sectors. We believe that high quality
bonds will continue to play an important role in a well balanced portfolio.
42
<PAGE>
GE FIXED INCOME FUND
======================================================================
QUALITY RATINGS
AT SEPTEMBER 30, 1998
======================================================================
Percent of
Moody's Ratings+ Market Value
- ----------------------------------------------------------------------
Aaa 80.0%
A to AA 7.0%
Below A 13.0%
- ----------------------------------------------------------------------
100.0%
+ Moody's Investors Service, Inc. is a nationally recognized statistical
rating organization.
INVESTMENT PROFILE
A mutual fund designed for investors who seek high current income and
preservation of capital by investing primarily in fixed income securities
including government and corporate bonds and asset- and mortgage-backed
securities including CMOs & ARMs.
* LIPPER PERFORMANCE COMPARISON
Intermediate U.S. Government Peer Group
Based on average annual total returns for the periods ended 9/30/98
One Three Five
Year Year Year
Number of Funds
in category: 129 107 69
Peer group
average annual
total return: 10.74% 7.58% 5.92%
Lipper categories in peer group: Intermediate U.S. Government,
Intermediate U.S. Treasury
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- ----------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A
W/O LOAD W/LOAD LB AGGR.
JAN 1, 94 10000 10000 10000
9746.86 9332.62 9712.67
9654.97 9244.63 9612.53
SEP-94 9698.17 9286 9671.1
9719.6 9306.52 9707.56
10150.16 9718.78 10197.12
10735.92 10279.64 10818.11
SEP-95 10908.39 10444.78 11030.9
11357.95 10875.24 11500.7
11105.43 10633.45 11295.55
11128.73 10655.76 11360.04
SEP-96 11335.1 10853.36 11569.21
11670.32 11174.33 11916.41
11597.7 11104.8 11850.22
12010.11 11499.68 12286.73
SEP-97 12376.85 11850.83 12696.38
12660.51 12122.44 13070.42
12858.12 12311.65 13272.1
13145.56 12586.87 13582.33
SEP-98 13578 12997 14156.4
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Fixed Income 9.70% 7.57% 6.65%
GE Fixed Income w/load 5.08% 6.02% 5.68%
(maximum load-4.25%)
LB Aggregate 11.50% 8.67% 7.59%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
W/O LOAD W/LOAD LB AGGR.
DEC 22, 93 10000 10000 10000
10020.6 10020.6 10000
9742.02 9742.02 9712.67
9638.19 9638.19 9612.53
SEP-94 9669.13 9669.13 9671.1
9678.39 9678.39 9707.56
10094.77 10094.77 10197.12
10673.82 10673.82 10818.11
SEP-95 10827.5 10827.5 11030.9
11255.17 11255.17 11500.7
10997.08 10997.08 11295.55
11006.6 11006.6 11360.04
SEP-96 11196.65 10996.65 11569.21
11522.84 11522.84 11916.41
11437.39 11437.39 11850.22
11828.98 11828.98 12286.73
SEP-97 12164.5 12064.5 12696.38
12437.88 12437.88 13070.42
12616.61 12616.61 13272.1
12871.97 12871.97 13582.33
SEP-98 13288 13288 14156.4
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Fixed Income 9.24% 7.06% 6.13%
GE Fixed Income w/load 6.24% 6.48% 6.13%
maximum load 3.0% 2.0% 0.0%
LB Aggregate 11.50% 8.67% 7.59%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS C
W/O LOAD LB AGGR
FEB 22, 93 10000 10000
10081.05 10041.8
10293.97 10307.89
SEP-93 10524 10576.96
10521.85 10583.22
10249.59 10279.87
10159.39 10173.87
SEP-94 10211.26 10235.87
10240.36 10274.46
10700.74 10792.61
11334.65 11449.87
SEP-95 11519.5 11675.08
11996.49 12172.31
11743.72 11955.18
11765.79 12023.44
SEP-96 11991.43 12244.82
12353.64 12612.3
12293.78 12542.24
12727.47 13004.24
SEP-97 13124.17 13437.82
13433.3 13833.7
13651.43 14047.16
13965.06 14375.51
SEP-98 14444 14983.1
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Fixed Income 10.06% 6.54% 6.78%
LB Aggregate 11.50% 7.21% 7.48%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS D
W/O LOAD LB AGGR.
NOV 29, 93 10000 10000
10043.77 10054.2
9790 9766.01
9709.77 9665.32
SEP-94 9765.5 9724.21
9799.5 9760.88
10246.42 10253.12
10859.91 10877.53
SEP-95 11044.37 11091.48
11510.21 11563.86
11269.08 11357.58
11297.78 11422.43
SEP-96 11521.71 11632.74
11887.32 11981.85
11828.12 11915.3
12264.5 12354.21
SEP-97 12643.48 12766.11
12960.2 13142.2
13178.51 13344.99
13478.76 13656.93
SEP-98 13950 14234.14
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Fixed Income 10.33% 8.10% 7.12%
LB Aggregate 11.50% 8.67% 7.57%
Legend as Follows:
GE Fixed Income Fund
GE Fixed Income Fund w/load
LB Aggregate
43
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
GE FIXED INCOME FUND
- --------------------------------------------------------------------------------
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Cash & Other 0.1%
Corporate Notes 19.3%
Mortgage Backed 31.6%
U.S. Governments 49.0%
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
BONDS AND NOTES -- 103.6%
- --------------------------------------------------------------------------------
U.S. TREASURIES -- 29.3%
U.S. Treasury Bonds
12.50% 08/15/14 $ 110,000 $ 181,036
10.625% 08/15/15 600,000 980,154(h)
8.125% 08/15/19 2,509,000 3,436,929
6.125% 11/15/27 3,177,000 3,662,477(h)
5.50% 08/15/28 835,000 902,585
9,163,181
U.S. Treasury Notes
7.75% 12/31/99 1,910,000 1,983,421(h)
5.50% 05/31/00 3,851,000 3,915,966
5.375% 06/30/00 3,390,000 3,444,037
5.125% 08/31/00 1,144,000 1,160,256
5.375% 02/15/01 135,000 138,059
6.25% 04/30/01 788,000 823,586(h)
6.625% 07/31/01 4,684,000 4,959,185
6.625% 03/31/02 1,486,000 1,593,274
5.375% 06/30/03 275,000 287,589
5.25% 08/15/03 1,799,000 1,879,397
6.625% 05/15/07 955,000 1,100,189
5.625% 05/15/08 1,553,000 1,698,594
22,983,553
U.S. Treasury STRIPS
5.58% 08/15/11 2,530,000 1,333,917 (d,f)
5.62% 02/15/12 1,650,000 842,523 (d,f)
2,176,440
TOTAL U.S. TREASURIES
(COST $32,847,825) 34,323,174
FEDERAL AGENCIES -- 19.7%
Federal Home Loan Bank
5.40% 10/01/98 11,000,000 11,000,000(d)
5.62% 08/10/00 700,000 710,829
6.22% 03/18/08 330,000 346,035
5.75% 04/15/08 850,000 898,611
12,955,475
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Federal National Mortgage Assoc.
5.60% 03/27/00 $ 715,000 $ 723,601
5.67% 05/26/00 1,420,000 1,440,405
5.56% 07/24/00 600,000 608,346
5.38% 01/16/01 895,000 907,029
5.625% 03/15/01 500,000 512,030
6.41% 07/08/02 370,000 391,042
5.75% 04/15/03 1,735,000 1,809,813
6.99% 07/09/07 945,000 1,014,250
6.00% 05/15/08 765,000 824,762
6.16% 08/07/28 1,025,000 1,094,598
9,325,876
Small Business Administration
6.55% 10/01/17 - 12/01/17 228,295 241,316
6.125% 01/10/18 539,118 557,987
799,303
TOTAL FEDERAL AGENCIES
(COST $22,669,175) 23,080,654
AGENCY MORTGAGE BACKED -- 26.2%
Federal Home Loan Mortgage Corp.
7.50% 06/01/10 662,996 683,960
9.00% 12/01/16 327,382 348,355
9.50% 04/01/21 29,293 31,801(h)
8.00% 08/01/25 - 10/01/25 540,358 559,747
6.50% 12/01/27 189,922 193,364
6.50% 04/01/28 - 07/01/28 891,215 907,363
2,724,590
Federal National Mortgage Assoc.
6.50% 01/01/04 28,236 28,592
8.50% 04/01/17 71,748 75,261(h)
7.00% 06/18/20 231,737 233,547(b)
6.247% 03/25/21 176,000 182,930
6.424% 12/25/23 175,000 183,531
7.00% 10/01/27 - 11/01/27 2,230,670 2,298,625
6.50% 04/01/28 - 07/01/28 5,884,476 5,983,749
7.00% 07/01/28 448,629 461,105
6.154% 11/01/35 1,350,003 1,365,190(e)
6.139% 05/01/36 482,251 487,676(e)
6.00% TBA 3,980,000 4,019,800(c)
6.50% TBA 1,889,612 1,920,599(c)
17,240,605
Federal National Mortgage Assoc. REMIC
7.623% 12/17/04 163,173 173,933
6.225% 05/25/14 61,825 63,332
6.42% 05/25/18 132,000 138,352
375,617
Government National Mortgage Assoc.
7.00% 03/15/12 1,617,692 1,667,727
7.50% 01/15/23 - 12/15/23 2,182,144 2,263,274
6.50% 02/15/24 - 04/15/24 649,932 665,362
6.50% 02/15/24 471,114 482,298(b)
7.50% 01/15/28 - 03/15/28 1,201,140 1,246,183
6.50% 04/15/28 1,784,070 1,823,641
7.00% 02/15/28 - 04/15/28 971,884 1,003,159
7.50% TBA 1,080,000 1,119,150(c)
10,270,794
TOTAL AGENCY MORTGAGE BACKED
(COST $30,103,820) 30,611,606
- ----------
See Notes to Schedule of Investments and Financial Statements.
44
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 1.8%
Collateralized Mortgage Obligation Trust
6.82% 09/01/15 $ 50,816 $ 47,878(d,f)
4.78% 11/01/18 92,258 77,323(d,f)
125,201
Federal Home Loan Mortgage Corp.
8.00% 04/15/20 52,546 55,124
6.50% 04/15/28 - 06/15/28 1,479,000 1,522,663
1,577,787
Federal National Mortgage Assoc.
8.50% 03/01/17 - 04/01/17 127,840 22,412(g)
8.50% 01/01/18 15,393 2,699(g)
9.00% 05/25/22 108,781 20,831(g)
8.50% 07/25/22 195,510 35,979(g)
81,921
Federal National Mortgage Assoc. REMIC
3.40% 07/25/20 110,958 109,633(d,f)
8.00% 10/25/20 89,666 95,802
3.58% 12/25/22 106,998 95,321(d,f)
300,756
TOTAL AGENCY COLLATERALIZED MORTGAGE
OBLIGATIONS
(COST $2,046,976) 2,085,665
ASSET BACKED -- 0.5%
Advanta Mortgage Loan Trust Corp.
6.30% 07/25/25 32,388 32,763
Carco Auto Loan Master Trust
6.689% 08/15/04 260,000 268,612
Fleetwood Credit Grantor Trust
6.40% 05/15/13 100,410 103,892
Iroquois Trust
6.752% 06/25/07 248,000 252,418(b)
TOTAL ASSET BACKED
(COST $632,623) 657,685
CORPORATE NOTES -- 19.3%
Abbey National PLC
7.35% 10/15/06 145,000 160,612
6.70% 06/29/07 530,000 512,113
Applied Materials Inc.
7.125% 10/15/17 100,000 99,945
Arizona Public Service Co.
6.25% 01/15/05 120,000 123,248
Atlantic City Electric Co.
6.19% 01/17/06 305,000 316,932
Banco Hipotecario Nacional
8.00% 06/04/99 250,000 225,000(b)
Bank Austria AG
7.25% 02/15/17 250,000 255,130
Bank of Scotland
7.00% 11/20/07 180,000 185,044(b)
Beckman Instruments Inc.
7.10% 03/04/03 170,000 174,588
Bell Telephone Co. - Pennsylvania
8.35% 12/15/30 75,000 98,431
Bellsouth Telecomm Inc.
6.375% 06/01/28 115,000 120,773
Black & Decker Holdings Inc.
7.05% 07/01/28 160,000 163,398(b)
Boston University
7.625% 07/15/97 325,000 386,435
Brascan Ltd.
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
7.375% 10/01/02 $ 120,000 $ 125,164
Carnival Corp.
5.65% 10/15/00 265,000 267,642
Circus Circus Enterprises Inc.
6.70% 11/15/03 150,000 141,675
Cleveland Electric Co.
7.19% 07/01/00 60,000 61,438
Columbia University Trustees
6.83% 12/15/20 120,000 135,253
Conseco Inc.
6.40% 06/15/01 305,000 307,284
6.80% 06/15/05 250,000 253,308
8.70% 11/15/26 160,000 166,534
Continental Cablevision Inc.
8.50% 09/15/01 125,000 135,051
Corporacion Andina De Fomento
6.75% 03/15/05 190,000 181,304
DDR Pass-Through Asset Trust
7.125% 03/15/02 415,000 421,873(b)
Dow Chemical Co.
8.55% 10/15/09 110,000 134,619
Empresa Nacional De Electricidad
8.125% 02/01/97 100,000 73,038
Energy Group Overseas
7.375% 10/15/17 180,000 183,836
Fairfax Financial Holdings Ltd.
7.375% 04/15/18 165,000 160,926
Federated Department Stores Inc.
6.125% 09/01/01 90,000 91,728
Felcor Suites Ltd.
7.375% 10/01/04 100,000 96,100
First Security Capital
8.41% 12/15/26 90,000 102,093
Ford Motor Credit Corp.
7.32% 05/23/02 328,000 331,280
Fujian International Trust &
Investment Corp.
7.375% 08/25/07 65,000 33,996(b)
Goldman Sachs Group L.P.
6.20% 12/15/00 195,000 200,464(b)
Gruma SA de C.V.
7.625% 10/15/07 100,000 82,500
Guangdong International Trust &
Investment Corp.
8.75% 10/24/16 65,000 33,526(b)
Heritage Media Corp.
8.75% 02/15/01 135,000 145,125
Household Finance Corp.
6.125% 07/15/02 135,000 137,025
Hydro-Quebec
8.05% 07/07/24 60,000 71,819
8.25% 04/15/26 360,000 438,797
International Lease Finance Corp.
5.62% 02/01/00 450,000 453,663
Israel Electric Corp. Ltd.
7.125% 07/15/05 95,000 97,366(b)
8.10% 12/15/96 240,000 245,098(b)
Korea Development Bank
7.125% 09/17/01 50,000 43,650
6.625% 11/21/03 135,000 104,586
Landeskreditbank Baden
7.875% 04/15/04 160,000 181,595
Lasmo USA Inc.
6.75% 12/15/07 170,000 168,169
LCI International Inc.
7.25% 06/15/07 226,000 230,954
Lehman Brothers Holdings Inc.
6.90% 03/30/01 55,000 55,019
7.50% 08/01/26 205,000 208,085
8.05% 01/15/19 100,000 100,750
- ----------
See Notes to Schedule of Investments and Financial Statements.
45
<PAGE>
GE FIXED INCOME FUND
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Liberty Property Ltd. Partnership
7.50% 01/15/18 $ 250,000 $ 237,655
Loewen Group International Inc.
7.50% 04/15/01 285,000 270,394
Loewen Pass Through Asset Trust
6.70% 10/01/99 510,000 493,425(b)
Long Island Lighting
7.30% 07/15/99 130,000 131,309
MBNA Corp.
6.306% 04/22/03 200,000 207,154
MCI Communications Corp.
6.125% 04/15/02 300,000 307,521
Meditrust
7.114% 08/15/04 130,000 115,863
Merita Bank Ltd.
7.15% 09/11/02 145,000 149,185(b)
MIC Financing Trust
8.375% 02/01/27 160,000 168,200(b)
Morgan Stanley Finance PLC
8.03% 02/28/17 90,000 97,425
Nabisco Inc.
6.70% 06/15/02 1,000,000 1,021,350
6.125% 02/01/03 140,000 140,624
National Rural Utilities Cooperative
6.046% 04/15/03 115,000 119,207
National Westminster Bank PLC
7.75% 04/29/07 265,000 283,836
New Jersey Economic Development
Authority
7.425% 02/15/29 115,000 136,663
News America Holdings Inc.
6.703% 05/21/04 200,000 208,256(b)
8.15% 10/17/36 100,000 111,344
Niagara Mohawk Power Corp.
9.50% 06/01/00 145,000 153,063
Norfolk Southern Corp.
7.90% 05/15/97 252,000 296,254
North Atlantic Energy Corp.
9.05% 06/01/02 145,000 151,073
NRG Energy Inc.
7.50% 06/15/07 140,000 150,500
NWCG Holding Corp.
5.29% 06/15/99 215,000 207,372(d)
Oryx Energy Co.
10.00% 06/15/99 150,000 154,268
9.50% 11/01/99 150,000 156,079
Paramount Communications Inc.
7.50% 01/15/02 125,000 130,915
Philip Morris Cos. Inc.
7.25% 09/15/01 120,000 125,693
7.20% 02/01/07 100,000 108,333
Reliance Industries Ltd.
10.50% 08/06/46 85,000 65,450(b)
Republic of Columbia
7.25% 02/15/03 100,000 90,966
Republic of Panama
7.875% 02/13/02 100,000 90,000(b)
Riggs Capital Trust
8.625% 12/31/26 90,000 95,009(b)
RJR Nabisco Inc.
8.00% 07/15/01 300,000 306,327
7.625% 09/15/03 105,000 104,065
St. George Funding Co.
8.485% 12/31/49 415,000 418,631(b)
Stop & Shop Cos. Inc.
9.75% 02/01/02 80,000 85,200
Sun Life Canada Capital Trust
8.526% 05/29/49 175,000 189,327(b)
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Sunamerica Inc.
5.60% 07/31/97 $ 485,000 $ 410,480
Suntrust Bank Inc.
6.00% 01/15/08 120,000 124,330
TCI Communications Inc.
8.65% 09/15/04 70,000 80,757
Tele-Communications Inc.
9.25% 04/15/02 100,000 112,227
9.80% 02/01/12 165,000 220,557
Tenet Healthcare Corp.
7.875% 01/15/03 105,000 106,575
8.00% 01/15/05 40,000 40,600
Time Warner Entertainment Co. L.P.
10.15% 05/01/12 75,000 101,393
Time Warner Inc.
4.90% 07/29/99 315,000 313,375(b)
6.10% 12/30/01 100,000 101,774(b)
Toledo Edison Co.
7.38% 03/31/00 250,000 256,455
Transamerica Capital
7.625% 11/15/37 105,000 111,300
Turner Broadcasting Systems Inc.
8.375% 07/01/13 160,000 182,062
Tyco International Group S.A.
6.25% 06/15/03 255,000 264,040
7.00% 06/15/28 135,000 141,253
United Illuminating Co.
6.25% 12/15/02 50,000 50,724
United Parcel Service Inc.
8.375% 04/01/30 200,000 254,662
US West Capital Funding Inc.
6.125% 07/15/02 55,000 56,834
6.875% 07/15/28 85,000 90,106
USA Waste Services Inc.
6.125% 07/15/01 500,000 509,445
USX Marathon Group
9.80% 07/01/01 120,000 131,648
8.125% 07/15/23 120,000 128,783
Viacom Inc.
7.75% 06/01/05 250,000 269,965
Washington Mutual Capital
8.375% 06/01/27 131,000 144,946
Waterford Funding Corp.
8.09% 01/02/17 400,000 443,572
Westdeutsche Landesbank
6.75% 06/15/05 200,000 213,618
Westinghouse Electric Corp.
8.875% 06/01/01 75,000 80,042
Williams Cos. Inc.
6.125% 02/15/02 235,000 238,551
Worldcom Inc.
6.125% 08/15/01 105,000 107,423
6.40% 08/15/05 165,000 174,111
8.875% 01/15/06 200,000 219,392
6.95% 08/15/28 125,000 131,695
Yale University Notes
7.375% 04/15/96 100,000 120,472
Zurich Capital Trust
8.376% 06/01/37 100,000 109,383(b)
TOTAL CORPORATE NOTES
(COST $22,124,410) 22,544,468
NON-AGENCY MORTGAGE BACKED SECURITIES -- 5.4%
Amresco Commercial Mortgage
Funding Corp.
6.73% 06/17/29 155,757 160,283
Asset Securitization Corp.
6.50% 12/14/02 115,624 118,875
- ----------
See Notes to Schedule of Investments and Financial Statements.
46
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
BHN Mortgage Trust
7.54% 04/30/07 $ 113,609 $ 74,982(b)
7.916% 02/15/12 62,493 42,495(b)
DLJ Mortgage Acceptance Corp.
6.41% 02/15/08 462,000 481,635
6.65% 12/17/27 58,145 59,835(b)
First Union Lehman Brothers Bank
6.28% 11/15/35 565,947 583,633
GS Mortgage Securities Corp.
5.58% 07/13/30 207,000 219,485(d)
Merrill Lynch Mortgage Investors Inc.
6.36% 11/15/26 376,000 391,451
Mid State Trust
6.96% 07/01/25 57,181 59,093
Morgan Stanley Capital Inc.
6.52% 01/15/08 400,000 425,875
6.476% 10/15/10 180,797 185,741(b)
6.86% 07/15/29 229,841 242,770(b)
6.54% 07/15/30 580,000 609,091
6.70% 10/03/30 84,780 88,767
Salomon Brothers Mortgage Securities Inc.
7.00% 07/25/24 394,182 386,344
Sawgrass Finance REMIC Trust
6.45% 01/20/06 100,000 102,109
Structured Asset Securities Corp.
5.65% 09/25/99 14,723 14,714(b)
6.256% 08/25/00 979,244 967,922(b)
6.79% 11/01/27 128,320 134,295
8.495% 04/25/27 284,116 295,125
0.49% 02/25/28 1,542,261 85,306(d,g)
Vornado Finance Corp.
6.36% 12/01/00 572,000 583,261(b)
TOTAL NON-AGENCY MORTGAGE BACKED SECURITIES
(COST $6,232,822) 6,313,087
NON-AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 1.4%
BlackRock Capital Financial
7.22% 11/25/28 456,000 471,248
7.25% 11/25/28 271,098 259,830
5.476% 11/25/38 173,173 177,935
Residential Assets Securitization Trust
7.75% 04/25/27 - 06/25/27 443,490 461,031
7.50% 08/25/27 247,000 254,487
TOTAL NON-AGENCY COLLATERALIZED MORTGAGE
OBLIGATIONS
(COST $1,596,518) 1,624,531
TOTAL BONDS AND NOTES
(COST $118,254,169) 121,240,870
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
PREFERRED STOCK -- 0.9%
- --------------------------------------------------------------------------------
CORPORATE PREFERRED
Banesto Holdings Ltd., 10.50% 4,600 $ 144,900(b)
Coastal Finance Corp., 8.375% 2,000 49,500
New Plan Realty Trust, 8.625% 4,151 200,286
News Corp. Ltd., 5.00% 1,600 102,400(b)
Pinto Totta International
Finance Ltd., 7.777% 270 233,660(b)
Simon DeBartolo Group Inc., 7.89% 2,860 133,705
TCI Communications Inc., 10.00%. 4,800 131,101
TOTAL PREFERRED STOCK
(COST $1,066,130) 995,552
TOTAL INVESTMENTS IN SECURITIES
(COST $119,320,299) 122,236,422
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 0.3%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $414,526) 414,526 414,526
NUMBER
EXPIRATION DATE/ OF
STRIKE PRICE CONTRACTS VALUE
- --------------------------------------------------------------------------------
CALL OPTIONS -- 0.0%
- --------------------------------------------------------------------------------
U.S. Treasury Notes Oct 98/110.09 (1,550) (6,539)
U.S. Treasury Notes Oct 98/107.88 (835) (9,785)
(WRITTEN OPTION PREMIUM $(9,931)) (16,324)
- --------------------------------------------------------------------------------
PUT OPTIONS -- 0.0%
- --------------------------------------------------------------------------------
U.S. Treasury Bonds Oct 98/102.92 (1,600) (0)
U.S. Treasury Notes Oct 98/107.01 (1,550) (7,023)
U.S. Treasury Notes Oct 98/101.88 (835) (131)
(WRITTEN OPTION PREMIUM $(15,481)) (7,154)
OTHER ASSETS AND LIABILITIES,
NET (4.8)% (5,627,576)
================================================================================
NET ASSETS -- 100% $116,999,894
================================================================================
- ----------
See Notes to Schedule of Investments and Financial Statements.
47
<PAGE>
GE GOVERNMENT SECURITIES FUND
FIVE YEAR TREASURY NOTE YIELD HISTORY
10/1/97 -- 9/30/98
[LINE GRAPHIC OMITTED]
PLOT POINTS TO FOLLOW
INVESTMENT PROFILE
A mutual fund designed for investors who seek a high level of current
income with safety of principal by investing primarily in obligations
insured or guaranteed by the U.S. Government or by its agencies or
instrumentalities.
* LIPPER PERFORMANCE COMPARISON
Intermediate U.S. Government Peer Group
Based on average annual total returns for the periods ended 9/30/98
One Three Five Ten
Year Year Year Year
Number of Funds
in peer group: 129 107 69 20
Peer group
average annual
total return: 10.74% 7.58% 5.92% 8.04%
Lipper categories in peer group: Intermediate U.S. Treasury,
Intermediate U.S. Government
* See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- ----------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A
W/O LOAD W/LOAD LB GOVERNMENT
10000 10000 10000
9/93 9903.09 9482.2 10038
9910.14 9488.96 10004.17
9609.14 9200.75 9702.89
9162.03 8772.64 9591.62
9/94 9084.41 8698.33 9632.3
9060.13 8675.08 9666.84
9365.2 8967.18 10121.71
9842.12 9423.83 10749.7
9/95 9978.59 9554.5 10939.25
10350.65 9910.75 11438.93
10155.47 9723.87 11180.35
10173.63 9741.25 11232.97
9/96 10352.8 9912.81 11422.8
10646.56 10194.08 11756.09
10601.57 10151.01 11660.57
10981.84 10515.11 12063.83
9/97 11329.33 10847.83 12467.87
11632.14 11137.77 12882.11
11788.54 11287.52 13076.55
12114.14 11599.29 13421.97
9/98 12646 12109 14163.97
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Gov't Securities 11.61% 5.01% 4.75%
GE Gov't Securities
w/load 6.87% 4.10% 3.85%
(maximum load-4.25%)
LB Gov't 13.60% 7.13% 7.11%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS
CLASS B (10 YR.)
W/O LOAD W/LOAD LB GOVERNMENT
9/88 10000 10000 10000
9/89 10920.3 10920.3 11112.89
9/90 11889.15 11889.15 11884.76
9/91 13518.99 13518.99 13724.14
9/92 14894.9 14894.9 15497.96
9/93 16052.28 16052.28 17215.19
9/94 14608.99 14608.99 16519.41
9/95 15962.84 15962.84 18760.83
9/96 16416.08 16416.08 19590.14
9/97 17964.52 17964.52 21382.43
9/98 20050.38 20050.38 24291.25
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE TEN
YEAR YEAR YEAR
GE Gov't Securities 10.99% 4.29% 7.21%
GE Gov't Securities
w/load 7.99% 4.14% 7.21%
maximum load 3.0% 1.0% 0.0%
LB Gov't 13.60% 7.13% 9.28%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS
CLASS C INCEPTION DATE 10/27/97
W/O LOAD LB GOVERNMENT
10000 10000
10/97 10016.45 10037
11/97 10046.04 10088.19
12/97 10137.96 10194.11
1/98 10279.85 10347.03
2/98 10255.23 10319.09
3/98 10269.55 10347.98
4/98 10287.57 10394.55
5/98 10404.81 10501.61
6/98 10537.96 10621.33
7/98 10548.62 10637.26
8/98 10759.64 10913.83
9/98 11000.66 11208.51
AGGREGATE ANNUAL
TOTAL RETURN
SINCE
INCEPTION
GE Gov't Securities 10.01%
LB Gov't 12.09%
Legend as Follows:
GE Government Securities Fund
GE Government Securities Fund w/load
LB Gov't
48
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
GE GOVERNMENT SECURITIES FUND
- --------------------------------------------------------------------------------
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Cash & Other 4.1%
CMOs 5.7%
Corporate Notes 7.0%
U.S. Governments 83.2%
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
BONDS AND NOTES -- 97.8%
- --------------------------------------------------------------------------------
U.S. TREASURIES -- 19.7%
U.S. Treasury Bonds
11.875% 11/15/03 $12,500,000 $ 16,710,875
8.125% 08/15/19 2,450,000 3,356,108
6.125% 11/15/27 40,460,000 46,642,693(l)
5.50% 08/15/28 3,800,000 4,107,572(l)
70,817,248
U.S. Treasury Notes
5.375% 06/30/00 11,619,000 11,804,207
5.50% 03/31/03 1,310,000 1,373,862
13,178,069
TOTAL U.S. TREASURIES
(COST $78,198,935) 83,995,317
FEDERAL AGENCIES -- 42.0%
Federal National Mortgage Assoc.
11.875% 05/19/00 29,000,000 32,207,980
5.56% 07/24/00 1,335,000 1,353,570
12.00% 11/13/00 40,000,000 45,768,800(h)
6.16% 08/07/28 14,800,000 15,804,920
95,135,270
Financing Corp.
10.70% 10/06/17 28,165,000 45,446,763(h)
9.65% 11/02/18 2,020,000 3,033,151
48,479,914
Small Business Administration
8.15% 02/01/15 1,711,861 1,915,680
8.10% 03/01/15 8,350,637 9,334,446
7.60% 05/01/16 3,647,624 4,022,646
7.55% 06/01/16 7,729,753 8,512,390
7.70% 07/01/16 5,398,648 5,994,186
7.15% 03/01/17 4,668,481 5,074,055
34,853,403
TOTAL FEDERAL AGENCIES
(COST $168,613,371) 178,468,587
AGENCY MORTGAGE BACKED -- 21.5%
Federal Home Loan Mortgage Corp.
7.50% 02/01/07 90,932 93,830
7.50% 02/01/09 - 09/01/09 173,991 179,409
7.50% 06/01/10 - 12/01/10 5,872,134 6,053,359
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
7.50% 02/01/11 - 11/01/11 $5,387,381 $ 5,552,476
7.50% 01/01/12 - 07/01/12 4,950,168 5,100,906
9.00% 12/01/14 1,916,797 2,020,553
6.50% 08/01/25 - 12/01/25 7,604,202 7,749,237
6.50% 01/01/26 2,339,439 2,384,754
7.00% 12/01/26 20,481 21,025
7.00% 01/01/27 1,219,574 1,251,966
6.50% 02/01/27 828,894 843,914
7.50% 10/01/27 23,126 23,787(h)
31,275,216
Federal National Mortgage Assoc.
9.00% 05/01/21 - 07/01/21 1,765,821 1,875,071
7.00% 10/01/27 - 12/01/27 9,760,502 10,077,718
11,952,789
Government National Mortgage Assoc.
7.00% 03/15/12 4,610,421 4,753,022
9.00% 05/15/13 232,471 249,491
9.50% 05/15/16 - 12/15/16 209,235 225,971
9.50% 06/15/17 - 12/15/17 1,622,399 1,752,175
8.50% 05/15/21 87,692 92,952
8.50% 10/15/22 10,425 11,031
8.50% 03/15/23 483,223 510,703
6.50% 05/15/23 - 12/15/23 4,618,135 4,729,247
6.50% 01/15/24 - 04/15/24 3,676,464 3,763,743
7.00% 08/15/25 - 10/15/25 12,648,838 13,059,927
7.00% 04/15/26 2,286,436 2,360,014
7.50% 05/15/27 165,162 171,200
7.50% TBA 15,800,000 16,372,750(c)
48,052,226
TOTAL AGENCY MORTGAGE BACKED
(COST $88,272,594) 91,280,231
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 3.6%
Federal National Mortgage Assoc. REMIC
3.50% 10/25/21 14,200,000 12,935,206
5.00% 01/25/23 2,436,574 2,425,585
TOTAL AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS
(COST $13,691,889) 15,360,791
CORPORATE NOTES -- 7.0%
Abbey National PLC
7.35% 10/15/06 2,500,000 2,769,175
Bank Austria AG
7.25% 02/15/17 2,500,000 2,551,300
Continental Cablevision Inc.
8.30% 05/15/06 2,500,000 2,827,775
Hydro-Quebec
8.25% 04/15/26 2,500,000 3,047,200
Korea Development Bank
7.125% 09/17/01 2,500,000 2,182,525
Merita Bank Ltd.
7.15% 09/11/02 2,500,000 2,572,150(b)
National Westminster Bank PLC
7.75% 04/29/07 2,500,000 2,677,700
Philip Morris Cos. Inc.
7.20% 02/01/07 2,500,000 2,708,325
Sun Life Canada Capital Trust
8.526% 05/29/49 2,500,000 2,704,675(b)
Tele-Communications Inc.
9.25% 04/15/02 2,500,000 2,805,675
Washington Mutual Capital
8.375% 06/01/27 2,500,000 2,766,150
TOTAL CORPORATE NOTES
(COST $28,884,775) 29,612,650
- ----------
See Notes to Schedule of Investments and Financial Statements.
49
<PAGE>
GE GOVERNMENT SECURITIES FUND
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
NON-AGENCY MORTGAGE BACKED SECURITIES -- 1.9%
BHN Mortgage Trust
7.916% 02/15/12 $ 781,156 $ 531,187(b)
DLJ Mortgage Acceptance Corp.
6.99% 02/15/05 862,586 879,029(b)
Structured Asset Securities Corp.
6.256% 08/25/00 6,925,284 6,845,211(b)
TOTAL NON-AGENCY MORTGAGE BACKED
SECURITIES
(COST $8,552,573) 8,255,427
NON-AGENCY COLLATERALIZED
MORTGAGE OBLIGATIONS -- 2.1%
Norwest Asset Securities Corp.
7.25% 12/25/27 3,355,749 3,405,036
NYC Mortgage Loan Trust
6.75% 06/25/06 5,373,214 5,579,747(b)
TOTAL NON-AGENCY COLLATERALIZED
MORTGAGE OBLIGATIONS
(COST $8,605,406) 8,984,783
TOTAL INVESTMENTS IN SECURITIES
(COST $394,819,543) 415,957,786
NUMBER
OF
SHARES VALUE
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 12.6%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $53,673,074) 53,673,074 53,673,074
NUMBER
EXPIRATION DATE/ OF
STRIKE PRICE CONTRACTS VALUE
- --------------------------------------------------------------------------------
CALL OPTIONS -- 0.0%
- --------------------------------------------------------------------------------
U.S. Treasury Notes Oct 98/107.88 (3,800) (44,531)
(WRITTEN OPTION PREMIUM $(15,437)) (44,531)
- --------------------------------------------------------------------------------
PUT OPTIONS -- 0.0%
- --------------------------------------------------------------------------------
U.S. Treasury Bond Oct 98/102.92 (7,300) 0
U.S. Treasury Notes Oct 98/101.88 (3,800) (594)
(WRITTEN OPTION PREMIUM $(38,547)) (594)
OTHER ASSETS AND LIABILITIES,
NET (10.4%) (44,397,842)
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $425,187,893
================================================================================
- ----------
See Notes to Schedule of Investments and Financial Statements.
50
<PAGE>
GE SHORT-TERM GOVERNMENT FUND
- --------------------------------------------------------------------------------
TWO YEAR TREASURY NOTE YIELD HISTORY
10/1/97 -- 9/30/98
[LINE GRAPHIC OMITTED]
PLOT POINTS TO FOLLOW
High 5.78%
Low 4.58%
Avg. 5.46%
INVESTMENT PROFILE
A mutual fund designed for investors who seek high current income and
preservation of capital by investing primarily in short-term U.S. Government
Securities.
* LIPPER PERFORMANCE COMPARISON
Short-Term U.S. Government Bond Peer Group
Based on average annual total returns for the periods ended 9/30/98
One Three
Year Year
Number of Funds
in peer group: 201 154
Peer group average
annual total return: 7.69% 6.41%
Lipper categories in peer
group: Short-Term U.S. Treasury, Short U.S. Government,
Short-Intermediate U.S. Government
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- ----------------------------------------------------------------------------
CLASS A SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
CLASS A W/O LOAD WITH LOAD LB 1-3
3/2/94 10000 10000 10000
3/31/94 9942.3 9693.74 9949
6/30/94 9939.96 9691.46 9949.88
9/1/94 10039.62 9788.63 10049.39
12/30/94 10046.85 9795.68 10049.26
3/31/95 10323.98 10065.88 10382.28
6/30/95 10642.26 10376.2 10711.33
9/1/95 10790.1 10520.35 10871.71
12/30/95 11023.38 10747.79 11138.03
3/30/96 11046.68 10770.51 11181.07
6/30/96 11135.85 10857.45 11298.75
9/96 11289.72 11007.48 11488.39
12/30/96 11499.44 11211.95 11706.52
3/31/97 11580.09 11290.59 11781.51
6/30/97 11791.65 11496.86 12043.8
9/30/97 12001.3 11701.26 12279.88
12/30/97 12169.37 11865.13 12484.77
3/31/98 12332.21 12023.9 12665.17
6/30/98 12474.3 12162.44 12858.66
9/30/98 12854 12530 13253.24
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Short Term Gov't 7.10% 6.01% 5.63%
GE Short Term Gov't w/load 4.46% 5.10% 5.04%
(maximum load-2.5%)
LB 1-3 Yr. 7.93% 6.83% 6.34%
CLASS B SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS B
QUARTERLY W/O LOAD WITH LOAD LB 1-3
3/2/94 10000 10000 10000
3/31/94 9939.3 9939.3 9949
6/30/94 9936.92 9936.92 9949.88
9/30/94 10019.58 10019.58 10049.39
12/31/94 10017.76 10017.76 10049.26
3/31/95 10285.38 10285.38 10382.28
6/30/95 10593.6 10593.6 10711.33
9/30/95 10722.29 10722.29 10871.71
12/31/95 10944.67 10944.67 11138.03
3/30/96 10958.27 10958.27 11181.07
6/30/96 11037.1 11037.1 11298.75
9/1/96 11189.26 11189.26 11488.39
12/31/96 11377.44 11377.44 11706.52
3/30/97 11447.24 11447.24 11781.51
6/30/97 11656.1 11656.1 12043.8
9/30/97 11842.93 11742.93 12279.88
12/30/97 11998.26 11998.26 12484.77
3/30/98 12148.34 12148.34 12665.17
6/30/98 12288.55 12288.55 12858.66
9/30/98 12652 12652 13253.24
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Short Term Gov't 6.83% 5.67% 5.27%
GE Short Term Gov't w/load 3.83% 5.07% 5.27%
maximum load 3.0% 2.0% 0.0%
LB 1-3 Yr. 7.93% 6.83% 6.34%
CLASS C SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS C
QUARTERLY W/O LOAD LB 1-3
3/2/94 10000 10000
3/31/94 9942.8 9949
6/30/94 9955.14 9949.88
9/1/94 10052.77 10049.39
12/31/94 10074.78 10049.26
3/31/95 10359.1 10382.28
6/30/95 10684.97 10711.33
9/30/95 10831.26 10871.71
12/31/95 11081.52 11138.03
3/30/96 11102.52 11181.07
6/30/96 11208.51 11298.75
9/30/96 11370.47 11488.39
12/31/96 11588.85 11706.52
3/30/97 11667.42 11781.51
6/30/97 11898.02 12043.8
9/30/97 12117.11 12279.88
12/30/97 12294.69 12484.77
3/30/98 12455.99 12665.17
6/30/98 12616.79 12858.66
9/30/98 13009 13253.24
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Short Term Gov't 7.36% 6.30% 5.91%
LB 1-3 Yr. 7.93% 6.83% 6.34%
CLASS D SHARES
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
CLASS D
QUARTERLY W/O LOAD LB 1-3
3/2/94 10000 10000
3/31/94 9946.3 9949
6/30/94 9964.81 9949.88
9/94 10068.86 10049.39
12/30/94 10088.45 10049.26
3/31/95 10379.78 10382.28
6/30/95 10712.87 10711.33
9/95 10866.25 10871.71
12/30/95 11124.38 11138.03
3/30/96 11152.31 11181.07
6/30/96 11265.73 11298.75
9/96 11435.67 11488.39
12/30/96 11662.73 11706.52
3/30/97 11748.92 11781.51
6/30/97 11988.6 12043.8
9/30/97 12217.07 12279.88
12/30/97 12403.82 12484.77
3/30/98 12574.67 12665.17
6/30/98 12747.06 12858.66
9/30/98 13151 13253.24
AVERAGE ANNUAL
TOTAL RETURN
ONE THREE SINCE
YEAR YEAR INCEPTION
GE Short Term Gov't 7.65% 6.57% 6.16%
LB 1-3 Yr. 7.93% 6.83% 6.34%
Legend as Follows:
GE Short-Term Fund
GE Short-Term Fund w/load
LB 1-3 Yr.
51
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
GE SHORT-TERM GOVERNMENT FUND
- --------------------------------------------------------------------------------
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Cash & Other 1.8%
Asset Backed 5.3%
Mortgage Backed 5.3%
Corporate Notes 5.9%
U.S. Governments 81.7%
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
BONDS AND NOTES -- 98.3%
- --------------------------------------------------------------------------------
U.S. TREASURIES -- 40.4%
U.S. Treasury Notes
5.88% 08/31/99 $ 334,000 $ 337,758
5.50% 05/31/00 490,000 498,266
5.38% 01/31/00 - 07/31/00 2,630,000 2,669,445
5.75% 11/15/00 5,655,000 5,809,608(h)
5.38% 02/15/01 200,000 204,532
6.63% 07/31/01 235,000 248,806
5.88% 09/30/02 1,050,000 1,107,750
5.75% 11/30/02 215,000 226,186
TOTAL U.S. TREASURIES
(COST $10,896,661) 11,102,351
FEDERAL AGENCIES -- 28.9%
Federal Home Loan Bank
5.40% 10/01/98 300,000 300,000(d)
Federal National Mortgage Assoc.
5.60% 03/27/00 2,500,000 2,530,075
5.67% 05/26/00 465,000 471,682
5.56% 07/24/00 1,110,000 1,125,440
5.38% 01/16/01 675,000 684,072
5.63% 03/15/01 2,745,000 2,811,045
7,622,314
TOTAL FEDERAL AGENCIES
(COST $7,788,741) 7,922,314
AGENCY MORTGAGE BACKED -- 11.7%
Federal Home Loan Mortgage Corp.
8.00% 08/01/03 187,969 191,751
6.00% 12/01/08 62,487 63,047(h)
254,798
Federal National Mortgage Assoc.
6.59% 03/25/02 434,775 442,791
6.88% 11/17/02 85,613 87,566
9.00% 08/01/10 239,748 252,369
4.56% 10/17/16 1,800,000 82,116(d,g)
7.00% 06/18/20 49,376 49,761(b)
914,603
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Federal National Mortgage Assoc. REMIC
6.23% 05/25/14 $199,434 $ 204,296
Government National Mortgage Assoc.
6.52% 09/17/04 182,835 186,491
5.93% 05/17/06 236,847 240,621
9.00% 08/15/09 - 12/15/09 648,805 701,133
9.50% 12/15/09 666,921 716,431
1,844,676
TOTAL AGENCY MORTGAGE BACKED
(COST $3,194,896) 3,218,373
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 0.7%
Federal Home Loan Mortgage Corp.
6.25% 09/15/18 150,000 151,593
Federal Home Loan Mortgage Corp.
REMIC
1.00% 09/15/05 140 1,254(d,g)
1.00% 07/15/06 263 4,167(d,g)
5,421
Federal National Mortgage Assoc. REMIC
4.67% 11/25/06 25,620 24,894(d,f)
TOTAL AGENCY COLLATERALIZED MORTGAGE
OBLIGATIONS
(COST $178,252) 181,908
ASSET BACKED -- 5.3%
Capital Asset Research Funding L.P.
6.40% 03/15/02 67,379 67,884
Carco Auto Loan Master Trust
6.69% 08/15/04 54,000 55,789
Chemical Master Credit Card Trust I
5.55% 09/15/03 350,000 353,279
Discover Card Master Trust I
5.80% 09/16/03 200,000 202,936
Fleetwood Credit Grantor Trust
6.40% 05/15/13 119,004 123,132
Ford Motor Credit Corp.
4.95% 10/15/01 260,000 262,519(d)
Lehman FHA Title I Loan Trust
7.30% 05/25/17 41,146 41,596
Premier Auto Trust
5.21% 01/06/02 33,000 33,825
5.38% 01/06/02 250,000 252,343(d)
Provident Bank Home Equity
Loan Trust
6.72% 01/25/13 52,381 54,114
TOTAL ASSET BACKED
(COST $1,423,044) 1,447,417
CORPORATE NOTES -- 5.9%
Carnival Corp.
5.65% 10/15/00 125,000 126,246
Conseco Inc.
6.40% 06/15/01 40,000 40,300
Federated Department Stores Inc.
6.13% 09/01/01 100,000 101,920
Fleet Credit Card LLC
6.45% 10/30/00 250,000 256,090
Ford Motor Credit Corp.
7.32% 05/23/02 150,000 151,500
General Motors Acceptance Corp.
8.38% 01/19/99 100,000 100,815
Goldman Sachs Group L.P.
6.20% 12/15/00 100,000 102,802(b)
- ----------
See Notes to Schedule of Investments and Financial Statements.
52
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
National City Capital Trust
6.75% 06/01/99 $150,000 $ 151,500
NWCG Holding Corp.
5.29% 06/15/99 135,000 130,210(d)
Republic of Columbia
8.75% 10/06/99 50,000 47,750
USA Waste Services Inc.
6.13% 07/15/01 100,000 101,889
Vastar Resources Inc.
6.00% 04/20/00 100,000 101,042
Woolworth Corp.
7.00% 06/01/00 150,000 150,111
Worldcom Inc.
6.13% 08/15/01 50,000 51,153
TOTAL CORPORATE NOTES
(COST $1,597,621) 1,613,328
NON-AGENCY MORTGAGE BACKED SECURITIES -- 5.3%
Asset Securitization Corp.
6.50% 12/14/02 190,334 195,687
BlackRock Capital Finance
7.05% 12/25/08 516,109 518,045
DLJ Mortgage Acceptance Corp.
5.91% 02/08/00 214,945 214,676(b)
GS Mortgage Securities Corp.
6.94% 07/13/30 148,582 153,318
Salomon Brothers Mortgage
Securities Inc.
6.47% 01/20/28 188,921 192,579
Structured Asset Securities Corp.
6.75% 06/25/30 173,752 172,883(b)
TOTAL NON-AGENCY MORTGAGE
BACKED SECURITIES
(COST $1,438,756) 1,447,188
NON-AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 0.1%
Salomon Brothers Mortgage Securities Inc.
8.13% 11/01/12
(COST $27,169) 26,370 26,716
TOTAL INVESTMENTS IN SECURITIES
(COST $26,545,140) 26,959,595
NUMBER
OF
SHARES VALUE
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 0.8%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $225,282) 225,282 225,282
OTHER ASSETS AND LIABILITIES,
NET 0.9% 256,725
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $27,441,602
================================================================================
- ----------
See Notes to Schedule of Investments and Financial Statements.
53
<PAGE>
GE MONEY MARKET FUND
- --------------------------------------------------------------------------------
INVESTMENT PROFILE
A mutual fund designed for investors who seek current income and liquidity while
preserving their capital by investing in short-term, high grade money market
securities.
* LIPPER PERFORMANCE COMPARISON
Money Market Peer Group
Based on average annual total returns for the periods ended 9/30/98
One Three Five
Year Year Year
Number of Funds
in peer group: 303 264 193
Peer group average
total return: 4.93% 4.91% 4.66%
Lipper categories
in peer group: Money Market
*See Notes to Performance for explanation of peer categories
SEE NOTES TO PERFORMANCE.
PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
- --------------------------------------------------------------------------------
[LINE GRAPH OMITTED]
PLOT POINTS AS FOLLOWS:
9/98
GE MONEY MARKET 90 DAY T-BILL
FEB 22, 93 10000 10000
2/22/93 10000 10000
10028.72 10024.74
10094.88 10099.91
9/93 10164.21 10176.55
10236.25 10255.35
10307.06 10339.42
10392.39 10443.81
9/94 10500.2 10562.06
10627.61 10702.77
10778.38 10857.68
10928.54 11011.2
9/95 11079.32 11160.37
11227.98 11308.52
11369.71 11449.21
11509.01 11594.04
9/96 11653.48 11743.11
11800.27 11890.81
11944.97 12042.37
12096.32 12195.67
9/97 12252.89 12350.52
12412.02 12508.93
12570.34 12668.16
12730.09 12825.77
9/98 12894 12977.48
AVERAGE ANNUAL
TOTAL RETURN
ONE FIVE SINCE
YEAR YEAR INCEPTION
GE Money Market 5.23% 4.87% 4.64%
90 Day T-Bill 5.08% 4.98% 4.76%
Legend as Follows:
GE Money Market Fund
90 Day T-Bill
FUND YIELD
- --------------------------------------------------------------------------------
FUND IBC MONEY FUND
7 day current 5.05%+ 4.93%
7 day effective 5.18% 5.05%
CURRENT YIELD represents income earned on an investment in the Money Market Fund
for a seven day period and then annualized.
EFFECTIVE YIELD is calculated similarly but is slightly higher because it
reflects the compounding effect of earnings on reinvested dividends.
AN INVESTMENT IN THE GE MONEY MARKET FUND IS NEITHER INSURED NOR GUARANTEED BY
THE U.S. GOVERNMENT, AND NO ASSURANCE CAN BE GIVEN THAT THE GE MONEY MARKET FUND
WILL BE ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
+ The seven day yield, rather than the total return, more closely reflects
the current earnings of the GE Money Market Fund at September 30, 1998.
[Line Graphic of Money Omitted]
54
<PAGE>
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
GE MONEY MARKET FUND
- --------------------------------------------------------------------------------
[PIE CHART OMITTED]
PLOT POINTS ARE AS FOLLOWS:
Commercial Paper 28.3%
Certificates of Deposit & Other 35.5%
U.S. Government 36.2%
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 98.5%
- --------------------------------------------------------------------------------
U.S. GOVERNMENT (d) -- 36.2%
Federal Agricultural Mortgage Corp.
5.40% 11/04/98 $5,000,000 $ 4,974,500
Federal Farm Credit Bank
5.45% 10/08/98 300,000 299,682
Federal Home Loan Bank
5.07% 03/19/99 6,000,000 5,857,195
Federal Home Loan Mortgage Corp.
5.45% 10/09/98 5,600,000 5,593,214
5.42% 10/16/98-11/06/98 10,840,000 10,790,898
16,384,112
Federal National Mortgage Assoc.
5.36% 10/08/98 4,200,000 4,195,623
5.43% 10/16/98-10/23/99 13,600,000 13,556,482
5.41% 11/30/98 4,500,000 4,459,448
5.11% 03/19/99 6,000,000 5,856,208
28,067,761
TOTAL U.S. GOVERNMENT
(COST $55,583,250) 55,583,250
COMMERCIAL PAPER -- 28.3%
Abbey National PLC
5.48% 11/30/98 5,430,000 5,380,406
Associates Corp. of North America
5.48% 10/22/98 5,400,000 5,382,738
Bank of Montreal
5.49% 10/30/98 5,400,000 5,376,119
Citicorp
5.75% 10/01/98 6,300,000 6,300,000
Halifax Building Society
5.475% 10/01/98 5,430,000 5,430,000
Morgan (J.P.) & Co. Inc.
5.51% 10/02/98 6,000,000 5,999,075
Morgan Stanley Group Inc.
5.49% 10/22/98 4,080,000 4,066,934
UBS Finance Delaware Inc.
5.49% 10/13/98 5,580,000 5,569,788
TOTAL COMMERCIAL PAPER
(COST $43,505,060) 43,505,060
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
YANKEE CERTIFICATES OF DEPOSIT -- 13.1%
Bayerische Hypotheken
5.54% 10/13/98 $5,400,000 $ 5,400,000
Canadian Imperial
5.55% 10/06/98 1,000,000 1,000,000
5.56% 10/15/98 2,870,000 2,870,000
Deutsche Bank AG
5.56% 10/30/98 5,500,000 5,500,000
Dresdner Bank AG
5.56% 10/09/98 5,430,000 5,430,000
TOTAL YANKEE CERTIFICATES OF DEPOSIT
(COST $20,200,000) 20,200,000
TIME DEPOSITS -- 17.4%
Bank of Nova Scotia
5.813% 10/01/98 6,300,000 6,300,000
5.438% 10/02/98 7,300,000 7,300,000
Bayerische Vereinsbank AG
5.813% 10/01/98 6,490,000 6,490,000
Rabobank
5.75% 10/01/98 6,300,000 6,300,000
State Street Cayman Islands
5.625% 10/01/98 343,317 343,317
TOTAL TIME DEPOSITS
(COST $26,733,317) 26,733,317
BANKER'S ACCEPTANCE NOTE -- 3.5%
First Union Corp.
(COST $5,400,000) 5,400,000 5,400,000
TOTAL SHORT-TERM INVESTMENTS
(COST $151,421,627) 151,421,627
OTHER ASSETS AND LIABILITIES,
NET 1.5% 2,243,671
- --------------------------------------------------------------------------------
NET ASSETS -- 100% $153,665,298
================================================================================
- ----------
See Notes to Schedule of Investments and Financial Statements.
55
<PAGE>
NOTES TO PERFORMANCE (UNAUDITED)
- --------------------------------------------------------------------------------
Information on the preceding performance pages relating to the Funds' one-year
total return and top ten largest holdings is audited, all other information on
the performance pages is unaudited.
Total returns take into account changes in share price and assume reinvestment
of dividends and capital gains, if any. Investment returns and net asset value
on an investment will fluctuate and you may have a gain or loss when you sell
your shares. Classes A and B are shown both without the sales charge and also
assuming the reduction of the returns by the current maximum applicable sales
charges as described in Note 1 of the Notes to Financial Statements. Periods
less than one year are not annualized.
The performance data relating to Class A and B shares of GE Mid-Cap Growth Fund,
GE Value Equity Fund, GE Tax-Exempt Fund and GE Government Securities Fund, for
all periods except the year ended September 30, 1998, reflect the prior
performance and expense ratios (adjusted to reflect GE Funds current sales
charges) of Investors Trust Growth Fund, Investors Trust Value Fund, Investors
Trust Tax Free Fund and Investors Trust Government Fund respectively, each a
series of Investors Trust (collectively, the "Investors Trust Funds"), the
assets of which were acquired by the corresponding GE Fund on September 26, 1997
(the "Merger Date"). Because the Investors Trust Funds did not offer Class C or
D shares, performance data relating to the Class C and D shares of GE Tax-Exempt
Fund is limited to the period from the Merger Date to September 30, 1998. GE
Government Securities Fund did not offer Class D shares during the annual period
ended September 30, 1998, therefore no performance data is shown for Class D
shares of this fund.
Shares of the GE Government Securities Fund and GE Short-Term Government Fund
are neither insured nor guaranteed by the U.S. Government, and their prices will
fluctuate with market conditions.
A portion of the GE Tax-Exempt Fund's income may be subject to state, federal
and/or alternative minimum tax. Capital gains, if any, are subject to capital
gains tax.
GE Investment Management Incorporated ("GEIM") currently waives certain fees.
Had these fees and expenses not been absorbed, the returns (and/or yields) would
have been lower. These provisions may be terminated in the future.
The Standard & Poor's ("S&P") 500 Composite Price Index of stocks (S&P 500
Index), the S&P 400 Mid-Cap Composite Price Index of 400 (S&P Mid-Cap 400
Index), the S&P/Barra Composite Index of 500 value stocks (S&P/Barra 500 Value
Index), Morgan Stanley Capital International World Index (MSCI World), Morgan
Stanley Capital International EAFE Index (MSCI EAFE), Lehman Brothers Aggregate
Bond Index (LB Aggregate), Lehman Brothers 1-3 Year Government Bond Index (LB
1-3yr.), the Lehman Brothers 10-Year General Obligation Municipal Bond Index (LB
10yr. GO Muni Bond) and the Lehman Brothers Government Bond Index (LB Gov't) are
unmanaged indices and do not reflect the actual cost of investing in the
instruments that comprise each index. The S&P 500 Index is a composite of the
prices of 500 widely held stocks recognized by investors to be representative of
the stock market in general. The S&P Mid-Cap 400 Index is a
capitalization-weighted index of 400 U.S. stocks with a median market
capitalization of approximately $700 million. The S&P/Barra 500 Value Index is a
capitalization-weighted index of all the stocks in the S&P 500 Index that have
low price-to-book ratios. MSCI World Index is a composite of 1,559 stocks in
companies from 23 countries representing the European, Pacific Basin and
American regions. MSCI EAFE Index is a composite of 1,100 stocks of companies
from 21 countries representing stock markets of Europe, Australasia, New Zealand
and the Far East. LB Aggregate is a composite index of short-, medium-, and
long-term bond performance and is widely recognized as a barometer of the bond
market in general. The LB 1-3 is a composite of government and U.S. Treasury
obligations with maturities of 1-3 years. The LB 10yr. GO Muni Bond Index is
comprised of all municipal general obligation investment-grade debt issues with
maturities between 8 and 11 years and each issue must be at least $50 million.
The LB Gov't Index is comprised of all U.S. dollar fixed-rate U.S. agency and
Treasury bond issues (excluding stripped issues) with remaining maturities
greater than one year and with at least $100 million in outstanding issuance. A
number of the broad market returns are not available for the funds' commencement
of investment operations through September 30, 1998. In instances where the
inception date was not at the beginning of the month, broad market index returns
are calculated from the month end nearest to some of the funds' inception dates.
The 90-Day T-Bill is the average return on three month U.S. Treasury Bills. The
IBC Money Fund Report yields represent the average yields of 887 taxable money
market funds. The results shown for the foregoing indices assume the
reinvestment of net dividends or interest.
The peer universe of funds used in our peer ranking calculation is based on the
blend of Lipper peer categories, as shown. This blend is the same as the
category blend used by the Wall Street Journal (except for the GE Strategic
Investment Fund for which we use the specific Lipper peer group and the GE Money
Market Fund which is not in the Wall Street Journal). The actual number of funds
and numerical rankings in the Lipper and Wall Street Journal universes could
differ since the Wall Street Journal excludes certain funds which do not meet
their net asset or number of shareholder publication thresholds. Lipper is an
independent mutual fund rating service.
The views expressed in this document reflect our judgment as of the publication
date and are subject to change at any time without notice. The securities cited
may not represent future holdings and should not be considered as a
recommendation to purchase or sell a particular security. See the prospectus for
complete descriptions of investment objectives, policies, risks and permissible
investments.
56
<PAGE>
NOTES TO SCHEDULES OF INVESTMENTS
- --------------------------------------------------------------------------------
(a) Non-income producing security.
(b) Pursuant to Rule 144A under the Securities Act of 1933, these securities
may be resold in transactions exempt from registration, normally to
qualified institutional buyers. At September 30, 1998, these securities
amounted to $204,737, $194,186, $3,973,768, $7,628,723, $19,111,999 and
$540,122 or 0.5%, 0.4%, 2.7%, 6.5%, 4.5% and 2.0% of net assets for the GE
International Equity, GE Global Equity, GE Strategic Investment, GE Fixed
Income, GE Government Securities and GE Short-Term Government Funds,
respectively.
(c) Settlement is on a delayed delivery or when-issued basis with final
maturity to be announced (TBA) in the future.
(d) Coupon amount represents effective yield.
(e) Adjustable rate mortgage coupon. The stated rate represents the rate at
September 30, 1998.
(f) Principal only securities represent the right to receive the monthly
principal payments on an underlying U.S. Treasury or pool of mortgages. No
payments of interest are passed through to the "principal only" holder.
(g) Interest only securities represent the right to receive the monthly
interest payments on an underlying pool of mortgages. Payments of principal
on the pool reduce the value of the interest only holding.
(h) At September 30, 1998, all or a portion of this security was pledged to
cover collateral requirements for futures, options or TBAs.
(i) Escrowed to maturity. Bonds which are collateralized by U.S. Treasury
securities which are held in escrow by a trustee and used to pay principal
and interest on such bonds.
(j) Prerefunded. Bonds which are collateralized by U.S. Treasury securities
which are held in escrow and are used to pay principal and interest on the
tax-exempt issue and to retire the bonds at the earliest refunding date.
(k) The security is insured by AMBAC, MBIA or FGIC. The GE Tax-Exempt Fund had
insurance concentrations of 5% or greater as of September 30, 1998 (as a
percentage of net assets) as follows:
AMBAC 8.5%
MBIA 10.6%
(l) All or a portion of security out on loan.
(m) Rights - Samsung Display Devices Co. rights expire 10/15/98 and Societe
Europeene de Communicion rights were exchanged for acceptance shares, which
will convert to SEC Series A ADS and SEC Series B ADS upon their U.S.
listing date.
ABBREVIATIONS:
ADR -- American Depositary Receipt
AMBAC -- AMBAC Indemnity Corporation
FGIC -- Financial Guarantee Insurance Corporation
GDR -- Global Depository Receipt
G.O. -- General Obligation
MBIA -- Municipal Bond Investors Assurance Corporation
Regd. -- Registered
REMIC -- Real Estate Mortgage Investment Conduit
SDR -- Special Drawing Rights
STRIPS -- Separate Trading of Registered Interest and Principal of Securities
VRDN -- Variable Rate Demand Note
57
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS A CLASS B
9/30/98(b) 9/30/97 9/30/96(b) 9/30/95 9/30/94 9/30/98(b) 9/30/97 9/30/96(b) 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 3/2/94 -- -- -- -- 3/2/94
Net asset value,
beginning of period $20.26 $17.65 $15.87 $15.18 $15.00 $20.02 $17.47 $15.77 $15.13 $15.00
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income (loss) 0.04 0.01 0.07 0.09 0.06 (0.05) (0.06) 0.05 0.01 0.00
Net realized and unrealized
gains (losses) on investments (1.58) 3.16 1.74 0.64 0.12 (1.55) 3.11 1.65 0.64 0.13
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS)
FROM INVESTMENT OPERATIONS (1.54) 3.17 1.81 0.73 0.18 (1.60) 3.05 1.70 0.65 0.13
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.00 0.06 0.03 0.04 0.00 0.00 0.00 0.00 0.01 0.00
Net realized gains 3.74 0.50 0.00 0.00 0.00 3.74 0.50 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 3.74 0.56 0.03 0.04 0.00 3.74 0.50 0.00 0.01 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $14.98 $20.26 $17.65 $15.87 $15.18 $14.68 $20.02 $17.47 $15.77 $15.13
====================================================================================================================================
TOTAL RETURN (a) (8.93%) 18.41% 11.39% 4.87% 1.20% (9.39%) 17.86% 10.78% 4.33% 0.87
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $16,805 $17,270 $8,462 $3,948 $25 $948 $455 $272 $57 $34
Ratios to average net assets:
Net investment income (loss)* 0.22% 0.20% 0.43% 1.28% 1.01% (0.26%) (0.30%) 0.28% 0.10% 0.47%
Net expenses* 1.60% 1.60% 1.59% 1.60% 1.60% 2.10% 2.10% 2.10% 2.10% 2.10%
Gross expenses* 1.61% 1.60% 1.66% 1.95% 1.93% 2.59% 4.12% 3.50% 3.50% 2.43%
Portfolio turnover rate 93% 51% 36% 27% 6% 93% 51% 36% 27% 6%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
CLASS C CLASS D
9/30/98(B) 9/30/97 9/30/96(B) 9/30/95 9/30/94 9/30/98(B) 9/30/97 9/30/96(B) 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 3/2/94 -- -- -- -- 3/2/94
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value,
beginning of period $20.36 $17.65 $15.88 $15.19 $15.00 $20.43 $17.76 $15.94 $15.22 $15.00
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.09 0.05 0.11 0.12 0.00 0.01 0.13 0.17 0.12 0.10
Net realized and
unrealized gains
(losses) on
investments (1.60) 3.19 1.72 0.65 0.19 (1.46) 3.18 1.73 0.70 0.12
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
INVESTMENT OPERATIONS (1.51) 3.24 1.83 0.77 0.19 (1.45) 3.31 1.90 0.82 0.22
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.00 0.03 0.06 0.08 0.00 0.06 0.14 0.08 0.10 0.00
Net realized gains 3.74 0.50 0.00 0.00 0.00 3.74 0.50 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 3.74 0.53 0.06 0.08 0.00 3.80 0.64 0.08 0.10 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $15.11 $20.36 $17.65 $15.88 $15.19 $15.18 $20.43 $17.76 $15.94 $15.22
====================================================================================================================================
TOTAL RETURN (a) (8.71%) 18.79% 11.54% 5.16% 1.27% (8.34%) 19.16% 11.97% 5.45% 1.47%
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $6,114 $6,152 $3,230 $1,262 $481 $15,367 $75,098 $63,225 $32,907 $26,460
Ratios to average
net assets:
Net investment income* 0.50% 0.45% 0.68% 0.83% 0.66% 0.08% 0.76% 0.99% 0.97% 1.52%
Net expenses* 1.35% 1.35% 1.35% 1.35% 1.35% 1.04% 1.01% 1.03% 1.07% 1.10%
Gross expenses* 1.42% 1.58% 1.96% 2.75% 1.68% 1.06% 1.01% 1.03% 1.18% 1.43%
Portfolio turnover rate 93% 51% 36% 27% 6% 93% 51% 36% 27% 6%
</TABLE>
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
58
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GE GLOBAL EQUITY FUND
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS A CLASS B
9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94(c) 9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 12/22/93 -- -- -- -- 12/22/93
Net asset value,
beginning of period $24.61 $22.01 $20.18 $19.34 $18.61 $24.32 $21.87 $20.14 $19.32 $18.48
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment
income (loss) (0.01) 0.00 0.02 0.10 0.03 (0.11) (0.08) (0.04) 0.00 (0.01)
Net realized and
unrealized gains
(losses) on investments (2.61) 3.89 2.20 1.22 0.91 (2.57) 3.82 2.14 1.23 1.06
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS)
FROM INVESTMENT
OPERATIONS (2.62) 3.89 2.22 1.32 0.94 (2.68) 3.74 2.10 1.23 1.05
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.00 0.00 0.02 0.09 0.01 0.00 0.00 0.00 0.02 0.01
Net realized gains 2.47 1.29 0.37 0.39 0.20 2.47 1.29 0.37 0.39 0.20
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 2.47 1.29 0.39 0.48 0.21 2.47 1.29 0.37 0.41 0.21
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $19.52 $24.61 $22.01 $20.18 $19.34 $19.17 $24.32 $21.87 $20.14 $19.32
====================================================================================================================================
TOTAL RETURN (a) (11.03%) 18.51% 11.18% 7.16% 3.09% (11.44%) 17.92% 10.61% 6.62% 5.70%
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $1,414 $1,524 $4,054 $2,811 $694 $989 $877 $600 $356 $128
Ratios to average net assets:
Net investment income (loss)* (0.03%) (0.09%) 0.12% 0.47% 0.44% (0.48%) (0.52%) (0.34%) (0.11%) (0.08%)
Net expenses* 1.60% 1.60% 1.60% 1.60% 1.60% 2.10% 2.10% 2.10% 2.10% 2.10%
Gross expenses* 1.98% 3.10% 1.90% 2.17% 2.02% 2.45% 3.33% 3.50% 3.50% 2.52%
Portfolio turnover rate 71% 70% 46% 46% 26% 71% 70% 46% 46% 26%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS C CLASS D
9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94 9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 1/5/93 -- -- -- -- 11/29/93
Net asset value,
beginning of period $24.81 $22.18 $20.31 $19.40 $17.16 $24.83 $22.25 $20.37 $19.45 $17.49
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.05 0.04 0.06 0.09 0.07 0.09 0.10 0.13 0.13 0.11
Net realized and
unrealized gains
(losses) on
investments (2.65) 3.94 2.22 1.30 2.37 (2.63) 3.94 2.21 1.31 2.06
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS)
FROM INVESTMENT
OPERATIONS (2.60) 3.98 2.28 1.39 2.44 (2.54) 4.04 2.34 1.44 2.17
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.02 0.06 0.04 0.09 0.00 0.10 0.17 0.09 0.13 0.01
Net realized gains 2.47 1.29 0.37 0.39 0.20 2.47 1.29 0.37 0.39 0.20
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 2.49 1.35 0.41 0.48 0.20 2.57 1.46 0.46 0.52 0.21
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $19.72 $24.81 $22.18 $20.31 $19.40 $19.72 $24.83 $22.25 $20.37 $19.45
====================================================================================================================================
TOTAL RETURN (a) (10.86%) 18.82% 11.44% 7.47% 14.28% (10.59%) 19.14% 11.71% 7.76% 12.43%
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $28,412 $35,120 $28,682 $23,683 $20,432 $15,039 $22,642 $10,123 $9,785 $10,504
Ratios to average
net assets:
Net investment income* 0.22% 0.24% 0.33% 0.59% 0.52% 0.37% 0.48% 0.56% 0.84% 0.82%
Net expenses* 1.34% 1.35% 1.35% 1.35% 1.31% 1.07% 1.10% 1.10% 1.10% 1.10%
Gross expenses* 1.35% 1.45% 1.60% 1.42% 1.77% 1.07% 1.10% 1.12% 1.75% 1.52%
Portfolio turnover rate 71% 70% 46% 46% 26% 71% 70% 46% 46% 26%
</TABLE>
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
59
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE PREMIER GROWTH EQUITY FUND
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS A CLASS B CLASS C CLASS D
9/30/98(b) 9/30/97(b,f) 9/30/98(b) 9/30/97(b,f) 9/30/98(b) 9/30/97(b,f) 9/30/98(b) 9/30/97(b,f)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- 12/31/96 -- 12/31/96 -- 12/31/96 -- 12/31/96
Net asset value,
beginning of period $18.31 $15.00 $18.25 $15.00 $18.35 $15.00 $18.38 $15.00
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income (loss) 0.00 (0.04) (0.12) (0.09) 0.03 0.00 0.09 0.04
Net realized and unrealized
gains (losses)
on investments 2.36 3.35 2.36 3.34 2.38 3.35 2.37 3.34
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
INVESTMENT OPERATIONS 2.36 3.31 2.24 3.25 2.41 3.35 2.46 3.38
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.00 0.00 0.00 0.00 0.03 0.00 0.05 0.00
Net realized gains 0.29 0.00 0.29 0.00 0.29 0.00 0.29 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.29 0.00 0.29 0.00 0.32 0.00 0.34 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $20.38 $18.31 $20.20 $18.25 $20.44 $18.35 $20.50 $18.38
====================================================================================================================================
TOTAL RETURN (a) 13.09% 22.07% 12.47% 21.67% 13.35% 22.33% 13.65% 22.53%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $6,059 $1,395 $2,076 $447 $15,044 $7,287 $7,580 $5,770
Ratios to average net assets:
Net investment income (loss)* (0.01%) (0.34%) (0.62%) (0.76%) 0.17% (0.03%) 0.47% 0.31%
Net expenses* 1.37% 1.40% 1.90% 1.90% 1.12% 1.15% 0.88% 0.90%
Gross expenses* 1.42% 4.09% 2.27% 9.30% 1.16% 1.62% 0.89% 1.17%
Portfolio turnover rate 35% 17% 35% 17% 35% 17% 35% 17%
</TABLE>
[Graphic of Building Omitted]
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
60
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE U.S. EQUITY FUND
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS A CLASS B
9/30/98 9/30/97 9/30/96 9/30/95 9/30/94 9/30/98 9/30/97 9/30/96 9/30/95
(b) (b) (b) (b) (c) (b) (b) (b) (b) 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 12/22/93 -- -- -- -- 12/22/93
Net asset value,
beginning of period $29.43 $23.34 $20.28 $16.12 $16.48 $28.35 $22.57 $19.71 $16.03 $16.41
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.20 0.23 0.31 0.34 3.23 0.05 0.11 0.19 0.21 0.24
Net realized and
unrealized gains
(losses) on
investments 1.25 8.33 3.34 3.91 (3.22) 1.20 8.03 3.25 3.84 (0.25)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
INVESTMENT OPERATIONS 1.45 8.56 3.65 4.25 0.01 1.25 8.14 3.44 4.05 (0.01)
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.21 0.28 0.32 0.00 0.20 0.06 0.17 0.31 0.28 0.20
Net realized gains 2.43 2.19 0.27 0.09 0.17 2.43 2.19 0.27 0.09 0.17
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 2.64 2.47 0.59 0.09 0.37 2.49 2.36 0.58 0.37 0.37
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $28.24 $29.43 $23.34 $20.28 $16.12 $27.11 $28.35 $22.57 $19.71 $16.03
====================================================================================================================================
TOTAL RETURN (a) 5.38% 39.44% 18.36% 26.52% (0.86%) 4.80% 38.75% 17.78% 25.92% (0.09%)
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $85,907 $65,535 $34,523 $15,148 $1,214 $21,407 $14,380 $7,194 $1,563 $91
Ratios to average
net assets:
Net investment income* 0.67% 0.93% 1.40% 1.85% 1.87% 0.17% 0.44% 0.90% 1.29% 1.28%
Net expenses* 1.00% 1.00% 1.00% 1.00% 1.00% 1.50% 1.50% 1.50% 1.50% 1.50%
Gross expenses* 1.07% 1.11% 1.15% 1.25% 1.46% 1.63% 1.88% 2.08% 3.50% 1.96%
Portfolio turnover rate 29% 38% 49% 43% 51% 29% 38% 49% 43% 51%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS C CLASS D
9/30/98 9/30/97 9/30/96 9/30/95 9/30/98 9/30/97 9/30/96
(b) (b) (b) (b) 9/30/94 (b) (b) (b) 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 1/5/93 -- -- -- -- 11/29/93
Net asset value,
beginning of period $29.00 $23.02 $19.98 $16.13 $16.35 $28.99 $23.03 $19.98 $16.16 $16.37
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.27 0.30 0.36 0.37 1.00 0.34 0.37 0.40 0.38 0.32
Net realized and
unrealized gains
(losses) on
investments 1.22 8.19 3.30 3.86 (0.85) 1.21 8.19 3.31 3.88 (0.16)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS)
FROM INVESTMENT
OPERATIONS 1.49 8.49 3.66 4.23 0.15 1.55 8.56 3.71 4.26 0.16
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.24 0.32 0.35 0.29 0.20 0.33 0.41 0.39 0.35 0.20
Net realized gains 2.43 2.19 0.27 0.09 0.17 2.43 2.19 0.27 0.09 0.17
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 2.67 2.51 0.62 0.38 0.37 2.76 2.60 0.66 0.44 0.37
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $27.82 $29.00 $23.02 $19.98 $16.13 $27.78 $28.99 $23.03 $19.98 $16.16
====================================================================================================================================
TOTAL RETURN (a) 5.62% 39.76% 18.70% 26.86% 0.88% 5.86% 40.16% 18.97% 27.14% 0.96%
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $124,714 $97,886 $50,035 $26,007 $16,382 $281,071 $212,957 $144,470 $128,247 $114,885
Ratios to average
net assets:
Net investment income* 0.92% 1.18% 1.66% 2.12% 2.11% 1.16% 1.45% 1.90% 2.36% 2.27%
Net expenses* 0.75% 0.75% 0.75% 0.75% 0.62% 0.50% 0.50% 0.50% 0.50% 0.50%
Gross expenses* 0.84% 0.93% 1.06% 1.19% 1.21% 0.56% 0.52% 0.59% 0.71% 0.96%
Portfolio turnover rate 29% 38% 49% 43% 51% 29% 38% 49% 43% 51%
</TABLE>
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
61
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE MID-CAP GROWTH FUND
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS A CLASS B
9/30/98(b) 9/30/97(d) 10/31/96 10/31/95 10/31/94 9/30/98(b) 9/30/97(d) 10/31/96 10/31/95 10/31/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 9/8/93 -- -- -- -- 9/8/93
Net asset value,
beginning of period $17.61 $13.16 $11.38 $8.81 $8.69 $17.11 $12.87 $11.21 $8.74 $8.70
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment
income (loss) (0.04) (0.07) 0.00 0.01 (0.01) (0.08) (0.18) (0.09) (0.05) (0.04)
Net realized and
unrealized gains
(losses) on
investments (1.86) 4.52 1.78 2.56 0.21 (1.79) 4.42 1.75 2.52 0.16
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
INVESTMENT OPERATIONS (1.90) 4.45 1.78 2.57 0.20 (1.87) 4.24 1.66 2.47 0.12
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Net realized gains 7.37 0.00 0.00 0.00 0.08 7.40 0.00 0.00 0.00 0.08
Return of capital 0.07 0.00 0.00 0.00 0.00 0.04 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 7.44 0.00 0.00 0.00 0.08 7.44 0.00 0.00 0.00 0.08
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $8.27 $17.61 $13.16 $11.38 $8.81 $7.80 $17.11 $12.87 $11.21 $8.74
====================================================================================================================================
TOTAL RETURN (a) (16.11%) 33.81% 15.64% 29.17% 2.48% (16.62%) 33.02% 14.81% 28.26% 1.67%
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $10,134 $10,885 $8,222 $5,986 $4,182 $22,038 $32,280 $27,616 $14,311 $5,857
Ratios to average
net assets:
Net investment
income (loss)* (0.35%) (0.51%) 0.03% 0.10% (0.11%) (0.86%) (1.26%) (0.73%) (0.66%) (0.82%)
Net expenses* 1.40% 1.31% 1.35% 1.35% 1.34% 1.90% 2.06% 2.10% 2.10% 2.09%
Gross expenses* 1.45% 1.46% 1.70% 2.44% 3.53% 1.93% 2.21% 2.41% 3.19% 4.06%
Portfolio turnover rate 13% 139% 41% 74% 100% 13% 139% 41% 74% 100%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
CLASS C CLASS D
9/30/98(b,g,j) 9/30/98(b,h)
- --------------------------------------------------------------------------------
INCEPTION DATE 10/2/97 1/5/98
Net asset value, beginning of period $47.12 $10.00
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment income 0.00 0.01
Net realized and unrealized
gains (losses) on investments (3.58) (1.30)
- --------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM INVESTMENT OPERATIONS (3.58) (1.29)
- --------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.00 0.00
Net realized gains 34.86 0.00
Return of capital 0.19 0.00
- --------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 35.05 0.00
- --------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $8.49 $8.71
================================================================================
TOTAL RETURN (a) (16.69%) (12.90%)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $1,705 $471
Ratios to average net assets:
Net investment income (loss)* (0.06%) 0.21%
Net expenses* 1.15% 0.89%
Gross expenses* 1.32% 0.89%
Portfolio turnover rate 13% 13%
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
62
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE VALUE EQUITY FUND
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS A CLASS B
9/30/98(b) 9/30/97(d) 10/31/96 10/31/95 10/31/94 9/30/98(b) 9/30/97(d) 10/31/96 10/31/95 10/31/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 9/8/93 -- -- -- -- 9/8/93
Net asset value,
beginning of period $13.58 $10.83 $8.95 $7.51 $7.63 $13.48 $10.79 $8.93 $7.50 $7.64
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment
income (loss) 0.05 0.07 0.05 0.14 0.13 0.00 (0.01) 0.04 0.07 0.08
Net realized and
unrealized
gains (losses)
on investments 0.46 3.59 1.99 1.45 (0.16) 0.45 3.57 1.93 1.45 (0.17)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
INVESTMENT OPERATIONS 0.51 3.66 2.04 1.59 (0.03) 0.45 3.56 1.97 1.52 (0.09)
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.00 0.04 0.09 0.15 0.09 0.00 0.00 0.04 0.09 0.05
Net realized gains 4.16 0.87 0.07 0.00 0.00 4.16 0.87 0.07 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 4.16 0.91 0.16 0.15 0.09 4.16 0.87 0.11 0.09 0.05
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $9.93 $13.58 $10.83 $8.95 $7.51 $9.77 $13.48 $10.79 $8.93 $7.50
====================================================================================================================================
TOTAL RETURN (a) 5.86% 36.18% 23.10% 21.45% (0.32%) 5.32% 35.23% 22.30% 20.50% (1.10%)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $14,276 $8,236 $5,833 $4,083 $3,267 $44,655 $46,035 $33,318 $14,450 $7,970
Ratios to average
net assets:
Net investment
income (loss)* 0.50% 0.63% 1.03% 1.71% 1.92% 0.00% (0.12%) 0.23% 0.94% 1.09%
Net expenses* 1.31% 1.30% 1.35% 1.35% 1.35% 1.81% 2.05% 2.10% 2.10% 2.10%
Gross expenses* 1.33% 1.33% 1.73% 2.43% 3.55% 1.81% 2.07% 2.40% 3.18% 4.02%
Portfolio turnover rate 40% 131% 100% 27% 15% 40% 131% 100% 27% 15%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
CLASS C CLASS D
9/30/98(b,g,j) 9/30/98(b,h)
- --------------------------------------------------------------------------------
INCEPTION DATE 10/2/97 1/5/98
Net asset value, beginning of period $16.76 10.00
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment income 0.08 0.08
Net realized and unrealized
gains (losses) on investments 0.29 0.30
- --------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM INVESTMENT OPERATIONS 0.37 0.38
- --------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.00 0.00
Net realized gains 6.97 0.00
- --------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 6.97 0.00
- --------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $10.16 $10.38
================================================================================
TOTAL RETURN (a) 5.21% 3.80%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $2,366 $1,580
Ratios to average net assets:
Net investment income* 0.75% 0.98%
Net expenses* 1.06% 0.81%
Gross expenses* 1.23% 0.81%
Portfolio turnover rate 40% 40%
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
63
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE STRATEGIC INVESTMENT FUND
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS A CLASS B
9/30/98 9/30/97 9/30/96 9/30/95 9/30/94 9/30/98 9/30/97 9/30/96 9/30/95
(b) (b) (b) (b) (c) (b) (b) (b) (b) 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 12/22/93 -- -- -- -- 12/22/93
Net asset value,
beginning of period $24.01 $20.33 $18.43 $15.71 $16.21 $23.70 $20.04 $18.26 $15.62 $16.14
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.53 0.53 0.51 0.52 0.48 0.42 0.42 0.41 0.40 0.27
Net realized and
unrealized gains
(losses) on
investments 0.74 3.87 1.90 2.57 (0.65) 0.69 3.82 1.87 2.58 (0.46)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS)
FROM INVESTMENT
OPERATIONS 1.27 4.40 2.41 3.09 (0.17) 1.11 4.24 2.28 2.98 (0.19)
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.47 0.47 0.43 0.37 0.27 0.38 0.33 0.42 0.34 0.27
Net realized gains 0.78 0.25 0.08 0.00 0.06 0.78 0.25 0.08 0.00 0.06
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 1.25 0.72 0.51 0.37 0.33 1.16 0.58 0.50 0.34 0.33
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $24.03 $24.01 $20.33 $18.43 $15.71 $23.65 $23.70 $20.04 $18.26 $15.62
====================================================================================================================================
TOTAL RETURN (a) 5.58% 22.16% 13.35% 20.12% (1.32%) 4.91% 21.57% 12.73% 19.53% (1.25%)
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $32,689 $39,731 $25,232 $8,778 $1,104 $11,158 $5,685 $3,701 $882 $150
Ratios
to average net assets:
Net investment income* 2.18% 2.42% 2.60% 2.95% 2.59% 1.72% 1.92% 2.11% 2.46% 1.92%
Net expenses* 1.14% 1.15% 1.12% 1.15% 1.15% 1.63% 1.65% 1.65% 1.65% 1.65%
Gross expenses* 1.14% 1.15% 1.15% 1.19% 1.58% 1.63% 1.93% 2.10% 3.50% 2.08%
Portfolio turnover rate 119% 106% 93% 98% 68% 119% 106% 93% 98% 68%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS C CLASS D
9/30/98 9/30/97 9/30/96 9/30/95 9/30/98 9/30/97 9/30/96
(b) (b) (b) (b) 9/30/94 (b) (b) (b) 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 1/5/93 -- -- -- -- 11/29/93
Net asset value,
beginning of period $24.11 $20.38 $18.46 $15.72 $16.08 $24.16 $20.44 $18.49 $15.74 $16.02
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment
income (loss) 0.61 0.59 0.54 0.53 0.44 0.67 0.64 0.63 0.55 0.45
Net realized and
unrealized gains
(losses) on investments 0.73 3.88 1.92 2.59 (0.48) 0.72 3.89 1.90 2.62 (0.40)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS)
FROM INVESTMENT
OPERATIONS 1.34 4.47 2.46 3.12 (0.04) 1.39 4.53 2.53 3.17 0.05
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.52 0.49 0.46 0.38 0.26 0.57 0.56 0.50 0.42 0.27
Net realized gains 0.78 0.25 0.08 0.00 0.06 0.78 0.25 0.08 0.00 0.06
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 1.30 0.74 0.54 0.38 0.32 1.35 0.81 0.58 0.42 0.33
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $24.15 $24.11 $20.38 $18.46 $15.72 $24.20 $24.16 $20.44 $18.49 $15.74
====================================================================================================================================
TOTAL RETURN (a) 5.88% 22.45% 13.58% 20.35% (0.27%) 6.10% 22.76% 13.95% 20.70% 0.25%
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $49,540 $40,516 $26,467 $17,821 $13,018 $51,802 $37,924 $36,162 $18,665 $17,159
Ratios to average
net assets:
Net investment
income (loss)* 2.49% 2.66% 2.81% 3.21% 2.62% 2.70% 2.90% 3.16% 3.46% 2.93%
Net expenses* 0.85% 0.90% 0.90% 0.90% 0.85% 0.64% 0.65% 0.58% 0.65% 0.65%
Gross expenses* 0.85% 0.94% 1.05% 1.03% 1.33% 0.64% 0.65% 0.59% 0.97% 1.08%
Portfolio turnover rate 119% 106% 93% 98% 68% 119% 106% 93% 98% 68%
</TABLE>
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
64
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE TAX-EXEMPT FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
9/30/98(b) 9/30/97(d) 10/31/96 10/31/95 10/31/94 9/30/98(b) 9/30/97(d) 10/31/96 10/31/95 10/31/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 9/8/93 -- -- -- -- 9/8/93
Net asset value,
beginning of period $11.63 $11.42 $11.31 $10.59 $11.48 $11.63 $11.44 $11.32 $10.60 $11.48
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.51 0.53 0.62 0.55 0.45 0.44 0.51 0.62 0.55 0.43
Net realized and
unrealized gains
(losses) on investments 0.20 0.22 0.05 0.73 (0.78) 0.21 0.21 0.06 0.73 (0.82)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS)
FROM INVESTMENT
OPERATIONS 0.71 0.75 0.67 1.28 (0.33) 0.65 0.72 0.68 1.28 (0.39)
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.51 0.54 0.56 0.56 0.56 0.45 0.53 0.56 0.56 0.49
Net realized gains 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.51 0.54 0.56 0.56 0.56 0.45 0.53 0.56 0.56 0.49
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $11.83 $11.63 $11.42 $11.31 $10.59 $11.83 $11.63 $11.44 $11.32 $10.60
====================================================================================================================================
TOTAL RETURN (a) 6.33% 6.77% 6.13% 12.24% (2.99%) 5.68% 6.46% 6.12% 12.33% (3.45%)
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $5,730 $16,542 $16,169 $16,025 $14,283 $8,905 $10,133 $9,184 $7,668 $4,990
Ratios to average
net assets:
Net investment income* 4.32% 5.01% 5.42% 5.01% 4.08% 3.81% 4.79% 5.43% 5.01% 3.75%
Net expenses* 1.10% 0.35% 0.00% 0.00% 0.77% 1.60% 0.57% 0.00% 0.00% 1.14%
Gross expenses* 1.23% 1.57% 1.52% 1.81% 1.62% 1.71% 2.32% 2.26% 2.56% 2.30%
Portfolio turnover rate 74% 13% 6% 25% 0% 74% 13% 6% 25% 0%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
CLASS C CLASS D
9/30/98(b) 9/30/97(e) 9/30/98(b) 9/30/97(e)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCEPTION DATE -- 9/26/97 -- 9/26/97
Net asset value, beginning of period $12.09 $12.08 $12.10 $12.09
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.55 0.02 0.58 0.02
Net realized and unrealized gains on investments 0.21 0.00 0.27 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM INVESTMENT OPERATIONS 0.76 0.02 0.85 0.02
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.55 0.01 0.65 0.01
Net realized gains 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.55 0.01 0.65 0.01
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $12.30 $12.09 $12.30 $12.10
====================================================================================================================================
TOTAL RETURN (a) 6.48% 0.11% 7.30% 0.11%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $10,794 $8,032 $24 $3,216
Ratios to average net assets:
Net investment income* 4.57% 4.04% 4.74% 4.31%
Net expenses* 0.85% 0.74% 0.60% 0.54%
Gross expenses* 0.98% 0.76% 1.25% 0.56%
Portfolio turnover rate 74% 13% 74% 13%
</TABLE>
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
65
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE FIXED INCOME FUND
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS A CLASS B
9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94(c) 9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 12/22/93 -- -- -- -- 12/22/93
Net asset value,
beginning of period $12.05 $11.69 $11.91 $11.27 $12.19 $12.06 $11.70 $11.91 $11.26 $12.15
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.64 0.69 0.65 0.73 0.47 0.58 0.63 0.60 0.65 0.42
Net realized and
unrealized gains
(losses) on
investments 0.50 0.35 (0.19) 0.63 (0.84) 0.50 0.36 (0.20) 0.66 (0.81)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS)
FROM INVESTMENT OPERATIONS 1.14 1.04 0.46 1.36 (0.37) 1.08 0.99 0.40 1.31 (0.39)
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.64 0.68 0.68 0.72 0.47 0.57 0.63 0.61 0.66 0.42
Net realized gains 0.00 0.00 0.00 0.00 0.08 0.00 0.00 0.00 0.00 0.08
In excess of net
investment income 0.02 0.00 0.00 0.00 0.00 0.02 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.66 0.68 0.68 0.72 0.55 0.59 0.63 0.61 0.66 0.50
- -----------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $12.53 $12.05 $11.69 $11.91 $11.27 $12.55 $12.06 $11.70 $11.91 $11.26
====================================================================================================================================
TOTAL RETURN (a) 9.70% 9.19% 3.91% 12.48% (3.02%) 9.24% 8.64% 3.41% 11.98% (3.31%)
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $35,342 $18,617 $15,653 $5,400 $26,023 $1,855 $1,401 $1,673 $234 $65
Ratios to average
net assets:
Net investment income* 5.28% 5.81% 5.66% 6.22% 5.37% 4.79% 5.17% 5.19% 5.57% 4.83%
Net expenses* 1.05% 1.09% 1.05% 1.08% 1.10% 1.55% 1.56% 1.60% 1.60% 1.58%
Gross expenses* 1.06% 1.14% 1.12% 1.18% 1.51% 1.85% 2.19% 2.44% 3.50% 2.01%
Portfolio turnover rate 219% 258% 275% 315% 298% 219% 258% 275% 315% 298%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
CLASS C CLASS D
9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94 9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 1/5/93 -- -- -- -- 11/29/93
Net asset value,
beginning of period $12.06 $11.70 $11.92 $11.27 $12.31 12.05 $11.69 $11.92 $11.27 $12.17
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.68 0.72 0.69 0.73 0.61 0.71 0.75 0.72 0.77 0.55
Net realized and
unrealized gains
(losses) on
investments 0.50 0.35 (0.21) 0.67 (0.96) 0.50 0.35 (0.22) 0.65 (0.83)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS)
FROM INVESTMENT OPERATIONS 1.18 1.07 0.48 1.40 (0.35) 1.21 1.10 0.50 1.42 (0.28)
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.67 0.71 0.70 0.75 0.61 0.70 0.74 0.73 0.77 0.54
Net realized gains 0.00 0.00 0.00 0.00 0.08 0.00 0.00 0.00 0.00 0.08
In excess of net
investment income 0.02 0.00 0.00 0.00 0.00 0.02 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.69 0.71 0.70 0.75 0.69 0.72 0.74 0.73 0.77 0.62
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $12.55 $12.06 $11.70 $11.92 $11.27 $12.54 $12.05 $11.69 $11.92 $11.27
====================================================================================================================================
TOTAL RETURN (a) 10.06% 9.45% 4.10% 12.81% (2.97%) 10.33% 9.74% 4.32% 13.10% (2.34%)
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $49,736 $35,097 $28,115 $21,401 $13,600 $30,067 $16,229 $19,098 $6,642 $2,732
Ratios to average
net assets:
Net investment income* 5.53% 6.17% 5.84% 6.37% 5.22% 5.58% 5.97% 6.14% 6.57% 5.40%
Net expenses* 0.80% 0.85% 0.85% 0.85% 0.79% 0.55% 0.56% 0.55% 0.59% 0.58%
Gross expenses* 0.83% 0.96% 0.99% 0.95% 1.26% 0.57% 0.59% 0.57% 2.50% 1.01%
Portfolio turnover rate 219% 258% 275% 315% 298% 219% 258% 275% 315% 298%
</TABLE>
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
66
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE GOVERNMENT SECURITIES FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
9/30/98(b) 9/30/97(d) 10/31/96 10/31/95 10/31/94 9/30/98(b) 9/30/97(d) 10/31/96 10/31/95 10/31/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 9/8/93 -- -- -- -- 4/22/87
Net asset value,
beginning of period $8.53 $8.48 $8.70 $8.43 $10.14 $8.54 $8.49 $8.71 $8.42 $10.14
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.56 0.53 0.62 0.58 0.70 0.52 0.47 0.55 0.51 0.60
Net realized and
unrealized gains
(losses) on
investments 0.39 0.05 (0.22) 0.38 (1.60) 0.39 0.05 (0.22) 0.41 (1.58)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
INVESTMENT OPERATIONS 0.95 0.58 0.40 0.96 (0.90) 0.91 0.52 0.33 0.92 (0.98)
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.53 0.53 0.54 0.58 0.70 0.48 0.47 0.48 0.52 0.60
Net realized gains 0.00 0.00 0.00 0.00 0.03 0.00 0.00 0.00 0.00 0.03
Return of capital 0.00 0.00 0.08 0.11 0.08 0.00 0.00 0.07 0.11 0.11
In excess of net
investment income 0.05 0.00 0.00 0.00 0.00 0.04 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.58 0.53 0.62 0.69 0.81 0.52 0.47 0.55 0.63 0.74
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $8.90 $8.53 $8.48 $8.70 $8.43 $8.93 $8.54 $8.49 $8.71 $8.42
====================================================================================================================================
TOTAL RETURN (a) 11.61% 7.13% 4.80% 11.77% (9.17%) 10.99% 6.36% 4.00% 11.19% (9.98%)
RATIOS/SUPPLEMENTAL
DATA:
Net assets, end of period
(in thousands) $24,541 $24,027 $29,090 $26,889 $21,498 $399,675 $523,303 $767,216 $1,112,254 $1,252,348
Ratios to average
net assets:
Net investment income* 6.52% 6.91% 6.59% 6.78% 7.09% 6.00% 6.15% 5.77% 6.08% 6.45%
Net expenses* 1.10% 0.88% 0.90% 1.01% 0.99% 1.60% 1.63% 1.69% 1.76% 1.76%
Gross expenses* 1.16% 0.88% 0.90% 1.01% 0.99% 1.61% 1.63% 1.69% 1.76% 1.76%
Portfolio turnover rate 64% 110% 334% 316% 129% 64% 110% 334% 316% 129%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
CLASS C
9/30/98(b,i)
- --------------------------------------------------------------------------------
INCEPTION DATE 10/28/97
Net asset value, beginning of period $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.61
Net realized and unrealized gains on investments 0.36
- --------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM INVESTMENT OPERATIONS 0.97
- --------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.51
Net realized gains 0.00
In excess of net investment income 0.05
- --------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.56
- --------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $10.41
================================================================================
TOTAL RETURN (a) 10.01%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $972
Ratios to average net assets:
Net investment income* 6.01%
Net expenses* 0.78%
Gross expenses* 1.46%
Portfolio turnover rate 64%
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
67
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE SHORT-TERM GOVERNMENT FUND
<TABLE>
<CAPTION>
CLASS A CLASS B
9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94 9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 3/2/94 -- -- -- -- 3/2/94
Net asset value,
beginning of period $11.85 $11.78 $11.91 $11.72 $12.00 $11.84 $11.78 $11.90 $11.72 $12.00
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.62 0.65 0.60 0.64 0.35 0.58 0.61 0.56 0.59 0.33
Net realized and
unrealized gains
(losses) on
investments 0.19 0.07 (0.06) 0.21 (0.30) 0.20 0.06 (0.05) 0.21 (0.31)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM
INVESTMENT OPERATIONS 0.81 0.72 0.54 0.85 0.05 0.78 0.67 0.51 0.80 0.02
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.63 0.64 0.61 0.66 0.33 0.59 0.60 0.57 0.62 0.30
Net realized gains 0.02 0.01 0.06 0.00 0.00 0.02 0.01 0.06 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.65 0.65 0.67 0.66 0.33 0.61 0.61 0.63 0.62 0.30
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $12.01 $11.85 $11.78 $11.91 $11.72 $12.01 $11.84 $11.78 $11.90 $11.72
====================================================================================================================================
TOTAL RETURN (a) 7.10% 6.30% 4.63% 7.48% 0.40% 6.83% 5.84% 4.35% 7.01% 0.20%
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $8,905 $7,298 $340 $285 $35 $895 $1,031 $145 $83 $25
Ratios to average
net assets:
Net investment income* 5.21% 5.24% 5.04% 5.27% 4.75% 4.87% 4.84% 4.67% 5.07% 4.38%
Net expenses* 0.95% 0.95% 0.95% 0.95% 0.95% 1.30% 1.30% 1.30% 1.30% 1.30%
Gross expenses* 1.17% 2.19% 3.00% 3.00% 1.71% 1.88% 7.77% 3.35% 3.35% 2.06%
Portfolio turnover rate 185% 265% 201% 415% 146% 185% 265% 201% 415% 146%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
CLASS C CLASS D
9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94 9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 3/2/94 -- -- -- -- 3/2/94
Net asset value,
beginning of period $11.86 $11.79 $11.91 $11.72 $12.00 $11.85 $11.78 $11.90 $11.72 $12.00
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment income 0.65 0.67 0.63 0.66 0.36 0.68 0.70 0.66 0.69 0.39
Net realized and
unrealized gains
(losses) on
investments 0.19 0.08 (0.05) 0.22 (0.30) 0.19 0.08 (0.05) 0.21 (0.31)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM
INVESTMENT OPERATIONS 0.84 0.75 0.58 0.88 0.06 0.87 0.78 0.61 0.90 0.08
- ------------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.66 0.67 0.64 0.69 0.34 0.69 0.70 0.67 0.72 0.36
Net realized gains 0.02 0.01 0.06 0.00 0.00 0.02 0.01 0.06 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.68 0.68 0.70 0.69 0.34 0.71 0.71 0.73 0.72 0.36
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE,
END OF PERIOD $12.02 $11.86 $11.79 $11.91 $11.72 $12.01 $11.85 $11.78 $11.90 $11.72
====================================================================================================================================
TOTAL RETURN (a) 7.36% 6.57% 4.98% 7.74% 0.53% 7.65% 6.83% 5.24% 7.92% 0.69%
RATIOS/SUPPLEMENTAL DATA:
Net assets,
end of period
(in thousands) $8,199 $5,319 $3,653 $2,437 $287 $9,444 $7,717 $7,786 $8,048 $7,822
Ratios to average net assets:
Net investment income* 5.47% 5.57% 5.28% 5.62% 5.18% 5.74% 5.80% 5.54% 5.89% 5.32%
Net expenses* 0.70% 0.70% 0.70% 0.70% 0.70% 0.45% 0.45% 0.45% 0.45% 0.45%
Gross expenses* 0.95% 1.07% 1.34% 1.84% 1.46% 0.68% 0.68% 0.83% 0.98% 1.21%
Portfolio turnover rate 185% 265% 201% 415% 146% 185% 265% 201% 415% 146%
</TABLE>
- ----------
See Notes to Financial Highlights and Notes to Financial Statements.
68
<PAGE>
FINANCIAL HIGHLIGHTS
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
- --------------------------------------------------------------------------------
GE MONEY MARKET FUND
<TABLE>
<CAPTION>
9/30/98(b) 9/30/97 9/30/96 9/30/95 9/30/94
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
INCEPTION DATE -- -- -- -- 1/5/93
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.05 0.05 0.05 0.05 0.03
Net realized and unrealized gains
on investments 0.00 0.00 0.00 0.00 0.00
- --------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM INVESTMENT
OPERATIONS 0.05 0.05 0.05 0.05 0.03
- --------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income 0.05 0.05 0.05 0.05 0.03
Net realized gains 0.00 0.00 0.00 0.00 0.00
- --------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.05 0.05 0.05 0.05 0.03
- --------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00
========================================================================================================
TOTAL RETURN (a) 5.23% 5.14% 5.18% 5.52% 3.31%
- --------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $153,665 $114,030 $85,842 $71,664 $53,607
Ratios to average net assets:
Net investment income* 5.11% 5.04% 5.06% 5.32% 3.41%
Net expenses* 0.50% 0.47% 0.45% 0.45% 0.45%
Gross expenses* 0.52% 0.56% 0.66% 0.70% 1.04%
- --------------------------------------------------------------------------------------------------------
</TABLE>
NOTES TO FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(a) Total returns are historical and assume changes in share price,
reinvestment of dividends and capital gains distributions, and assume no
sales charge. Had the Adviser not absorbed a portion of expenses, total
returns would have been lower. Periods less than one year are not
annualized.
(b) Per share data is based on average shares outstanding during the period.
(c) Per share information is for the period since inception through September
30, 1994, and the total return information is for the period January 1,
1994, commencement of investment operations, through September 30, 1994.
(d) For the period November 1, 1996, through September 30, 1997.
(e) For the period September 27, 1997, through September 30, 1997.
(f) For the period December 31, 1996 (commencement of operations), through
September 30, 1997.
(g) For the period October 2, 1997 (commencement of operations), through
September 30, 1998.
(h) For the period January 5, 1998 (commencement of operations), through
September 30, 1998.
(i) For the period October 28, 1997 (commencement of operations), through
September 30, 1998.
(j) The values shown for the per share information have been adjusted to
reflect the 1 share for 4.71 shares and the 1 share for 1.68 shares reverse
stock split in the GE Mid-Cap Growth and GE Value Equity Funds,
respectively, on November 6, 1998. Also see note 9 of Notes to Financial
Statements.
* Annualized for periods less than one year.
- ----------
See Notes to Financial Statements.
69
<PAGE>
STATEMENTS OF ASSETS
AND LIABILITIES SEPTEMBER 30, 1998
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE GE GE GE
INTERNATIONAL GLOBAL PREMIER GROWTH U.S. MID-CAP VALUE
EQUITY EQUITY EQUITY EQUITY GROWTH EQUITY
FUND FUND FUND FUND FUND FUND
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments in securities,
at market (cost $41,007,423;
$41,847,688; $25,116,770;
$432,927,429; $35,847,737;
$56,844,573; $124,810,135;
$23,738,319; $119,320,299;
$394,819,543; $26,545,140;
and $0, respectively) $37,911,668 $41,409,861 $28,321,927 $499,421,849 $32,062,639 $60,361,120
Short-term investments
(at amortized cost) 350,294 3,546,544 2,533,560 12,243,616 2,220,429 2,265,344
Cash -- -- -- -- -- --
Foreign currency (cost $798,335;
$141,920; $0; $244,947; $0;
$59,985; $616,270; $0;
$2,189; $0; $0; and $0,
respectively) 780,235 141,890 -- -- -- 60,011
Receivable for investments sold 118,198 776,788 -- 921,385 54,374 91,435
Income receivables 150,943 143,289 18,620 615,678 32,769 88,480
Receivable for fund shares sold 20,878 61,528 55,642 583,654 28,171 120,214
Receivable from advisor -- -- -- -- -- --
Variation margin receivable -- -- -- -- 16,875 --
Deferred organizational costs 8,806 -- 8,852 -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS 39,341,022 46,079,900 30,938,601 514,032,358 34,415,257 62,986,604
- ------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Options written, at market ** -- -- -- -- -- --
Distributions payable
to shareholders -- -- -- -- -- --
Payable upon return of
securities loaned -- -- -- -- -- --
Payable for investments purchased 26,366 109,553 138,379 611,076 47,947 5,850
Payable for fund shares redeemed 57,442 54,466 4,410 77,938 11,618 33,559
Payable to GEIM 23,669 53,331 20,261 166,199 8,051 24,261
Variation margin payable -- -- 15,750 78,750 -- 47,250
Payable to custodian -- 7,425 -- -- -- --
====================================================================================================================================
TOTAL LIABILITIES 107,477 224,775 178,800 933,963 67,616 110,920
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $39,233,545 $45,855,125 $30,759,801 $513,098,395 $34,347,641 $62,875,684
====================================================================================================================================
NET ASSETS CONSIST OF:
Capital paid in $41,164,297 $44,316,582 $26,460,067 $400,952,465 $39,596,337 $56,929,374
Undistributed (overdistributed)
net investment income (177,615) (91,940) 106,765 60,209 142,908 173,039
Accumulated net realized gain (loss) 1,360,204 2,062,153 996,625 41,946,277 (1,606,081) 2,238,031
Net unrealized appreciation /
(depreciation) on:
Investments (3,095,755) (437,827) 3,205,157 66,494,420 (3,785,098) 3,516,547
Futures -- -- (8,813) (5,424) (425) 20,738
Written options -- -- -- -- -- --
Foreign currency
related transactions (17,586) 6,157 -- 386 -- (2,045)
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $39,233,545 $45,855,125 $30,759,801 $513,098,395 $34,347,641 $62,875,684
====================================================================================================================================
CLASS A:
Net assets $16,805,161 $1,414,279 $6,059,380 $85,907,458 $10,134,429 $14,275,701
Shares outstanding ($.001 par value) 1,121,470 72,461 297,360 3,042,506 1,225,905 1,436,999
Net asset value per share $14.98 $19.52 $20.38 $28.24 $8.27 $9.93
Maximum offering price per share $15.89 $20.71 $21.62 $29.96 $8.77 $10.54
CLASS B:
Net assets $948,004 $989,199 $2,076,489 $21,406,660 $22,037,654 $44,654,539
Shares outstanding ($.001 par value) 64,572 51,608 102,778 789,581 2,825,726 4,570,649
Net asset value per share* $14.68 $19.17 $20.20 $27.11 $7.80 $9.77
CLASS C:
Net assets $6,113,654 $28,412,188 $15,044,208 $124,713,770 $1,704,836 $2,365,854
Shares outstanding ($.001 par value) 404,657 1,440,739 735,989 4,483,334 200,743 232,948
Net asset value per share $15.11 $19.72 $20.44 $27.82 $8.49 $10.16
CLASS D:
Net assets $15,366,726 $15,039,459 $7,579,724 $281,070,507 $470,722 $1,579,590
Shares outstanding ($.001 par value) 1,012,309 762,712 369,734 10,117,173 54,022 152,205
Net asset value per share $15.18 $19.72 $20.50 $27.78 $8.71 $10.38
</TABLE>
70
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE GE GE GE
STRATEGIC TAX- FIXED GOVERNMENT SHORT-TERM MONEY
INVESTMENT EXEMPT INCOME SECURITIES GOVERNMENT MARKET
FUND FUND FUND FUND FUND FUND***
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments in securities, at market
(cost $41,007,423; $41,847,688;
$25,116,770; $432,927,429;
$35,847,737; $56,844,573;
$124,810,135; $23,738,319;
$119,320,299; $394,819,543;
$26,545,140; and $0,
respectively) $140,615,184 $25,179,931 $122,236,422 $415,957,786 $26,959,595 $ --
Short-term investments
(at amortized cost) 4,298,512 17,323 414,526 53,673,074 225,282 151,421,627
Cash 1,954 -- -- -- -- --
Foreign currency (cost
$798,335; $141,920;
$0; $244,947; $0; $59,985;
$616,270; $0; $2,189; $0;
$0; and $0, respectively) 616,012 -- 2,218 -- -- --
Receivable for investments sold 1,564,991 1,334,541 6,319,970 19,764,260 -- --
Income receivables 783,993 435,223 1,328,056 8,601,312 281,945 263,358
Receivable for fund shares sold 140,276 19,828 92,438 -- 2,500 2,231,218
Receivable from advisor -- 23,651 -- -- -- --
Variation margin receivable -- -- -- -- -- --
Deferred organizational costs -- -- -- -- 8,810 --
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS 148,020,922 27,010,497 130,393,630 497,996,432 27,478,132 153,916,203
- ------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Options written, at market ** 11,034 -- 23,478 45,125 -- --
Distributions payable to shareholders -- 9,012 51,574 267,481 11,175 62,446
Payable upon return of
securities loaned -- -- -- 55,219,975 -- --
Payable for investments purchased 2,689,654 1,547,884 13,260,058 16,344,771 -- --
Payable for fund shares redeemed 58,275 -- 5,009 314,274 12,377 128,430
Payable to GEIM 71,592 -- 53,617 616,913 12,978 60,029
Variation margin payable -- -- -- -- -- --
Payable to custodian -- -- -- -- -- --
====================================================================================================================================
TOTAL LIABILITIES 2,830,555 1,556,896 13,393,736 72,808,539 36,530 250,905
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $145,190,367 $25,453,601 $116,999,894 $425,187,893 $27,441,602 $153,665,298
====================================================================================================================================
NET ASSETS CONSIST OF:
Capital paid in $114,753,851 $24,363,489 $114,949,056 $592,371,438 $26,994,436 $153,613,931
Undistributed (overdistributed)
net investment income 2,577,260 76,824 304,228 2,051,756 16,033 60,209
Accumulated net realized gain (loss) 12,052,154 (428,324) (1,171,476) (190,382,403) 16,678 (8,842)
Net unrealized appreciation /
(depreciation) on:
Investments 15,805,049 1,441,612 2,916,123 21,138,243 414,455 --
Futures -- -- -- -- -- --
Written options 737 -- 1,934 8,859 -- --
Foreign currency
related transactions 1,316 -- 29 -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $145,190,367 $25,453,601 $116,999,894 $425,187,893 $27,441,602 $153,665,298
====================================================================================================================================
CLASS A:
Net assets $32,689,445 $5,730,080 $35,342,367 $24,540,708 $8,904,634 $ --
Shares outstanding ($.001 par value) 1,360,629 484,304 2,819,828 2,758,476 741,310 --
Net asset value per share $24.03 $11.83 $12.53 $8.90 $12.01 $ --
Maximum offering price per share $25.50 $12.36 $13.09 $9.30 $12.32 $ --
CLASS B:
Net assets $11,158,423 $8,904,843 $1,854,969 $399,675,406 $894,724 $ --
Shares outstanding ($.001 par value) 471,776 752,804 147,778 44,738,403 74,523 --
Net asset value per share* $23.65 $11.83 $12.55 $8.93 $12.01 $ --
CLASS C:
Net assets $49,540,190 $10,794,406 $49,735,675 $971,779 $8,198,520 $153,665,298
Shares outstanding ($.001 par value) 2,051,444 877,706 3,964,240 93,377 682,000 153,676,045
Net asset value per share $24.15 $12.30 $12.55 $10.41 $12.02 $1.00
CLASS D:
Net assets $51,802,309 $24,272 $30,066,883 $ -- $9,443,724 $ --
Shares outstanding ($.001 par value) 2,140,884 1,973 2,397,641 -- 786,298 --
Net asset value per share $24.20 $12.30 $12.54 $ -- $12.01 $ --
</TABLE>
* Redemption price per share is equal to net asset value per share less any
applicable contingent deferred sales charge.
** Premiums received for the GE Strategic Investment Fund, GE Fixed Income
Fund, and GE Government Securities Fund were $11,771, $25,412, and $53,984,
respectively.
*** GE Money Market Fund is a no load fund offering only one class of shares to
all investors.
- ----------
See Notes to Financial Statements.
70 & 71
<PAGE>
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED SEPTEMBER 30, 1998
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE GE GE GE
INTERNATIONAL GLOBAL PREMIER GROWTH U.S. MID-CAP VALUE
EQUITY EQUITY EQUITY EQUITY GROWTH EQUITY
FUND FUND FUND FUND FUND FUND
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
INCOME:
Dividends $ 868,729 $ 858,798 $ 190,259 $ 6,845,069 $ 266,817 $ 936,664
Interest 122,881 55,964 127,447 986,969 172,942 198,310
Less: Foreign taxes withheld (95,003) (87,124) (1,495) (55,287) (3,277) (7,398)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME 896,607 827,638 316,211 7,776,751 436,482 1,127,576
- ------------------------------------------------------------------------------------------------------------------------------------
EXPENSES:
Advisory and administration fees 513,776 405,430 143,798 1,859,219 251,052 343,640
Distribution fees
Class A 93,169 7,461 22,425 407,188 57,865 62,686
Class B 6,976 10,425 11,664 189,090 286,820 475,716
Class C 16,213 84,372 28,153 298,964 3,146 3,295
Blue Sky fees 28,134 28,410 21,293 97,847 29,577 32,007
Transfer agent fees 69,860 101,446 18,889 370,192 55,707 66,483
Trustees' fees 1,512 1,336 488 10,095 1,082 1,476
Custody and accounting expenses 27,950 27,032 22,560 73,128 25,696 27,766
Professional fees 17,887 15,824 5,757 119,541 12,818 17,470
Registration expenses 5,247 4,640 1,689 35,065 3,758 5,124
Amortization of deferred
organization expenses 21,145 7,394 3,149 11,608 5,228 5,269
Other expenses 12,519 11,234 3,621 84,008 8,802 12,231
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSES BEFORE WAIVER 814,388 705,004 283,486 3,555,945 741,551 1,053,163
Less: Expenses waived or borne by
the adviser (18,400) (13,686) (11,424) (305,619) (18,322) (3,378)
- ------------------------------------------------------------------------------------------------------------------------------------
Net expenses 795,988 691,318 272,062 3,250,326 723,229 1,049,785
- ------------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME (LOSS) 100,619 136,320 44,149 4,526,425 (286,747) 77,791
====================================================================================================================================
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS
REALIZED GAIN (LOSS) ON:
Investments 17,904,686 2,694,613 1,223,716 46,729,598 (1,642,408) 2,735,061
Futures -- -- (25,513) (772,634) 164,676 (160,575)
Written options -- -- -- 1,698 -- 481
Foreign currency
related transactions (284,964) (177,498) 573 4,325 (57) 108
INCREASE (DECREASE) IN
UNREALIZED APPRECIATION/
DEPRECIATION ON:
Investments (21,291,887) (9,232,441) 1,063,109 (38,765,751) (5,050,812) 117,645
Futures -- -- (8,813) (19,400) (425) 24,363
Written options -- -- -- -- -- --
Foreign currency
related transactions (5,853) 17,100 -- 396 -- (2,045)
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain
(loss) on investments (3,678,018) (6,698,226) 2,253,072 7,178,232 (6,529,026) 2,715,038
- ------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE)
IN NET ASSETS RESULTING
FROM OPERATIONS $(3,577,399) $(6,561,906) $2,297,221 $11,704,657 $(6,815,773) $2,792,829
====================================================================================================================================
</TABLE>
72
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE GE GE GE
STRATEGIC TAX- FIXED GOVERNMENT SHORT-TERM MONEY
INVESTMENT EXEMPT INCOME SECURITIES GOVERNMENT MARKET
FUND FUND FUND FUND FUND FUND*
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
INCOME:
Dividends $ 1,284,246 $ -- $ 71,849 $ -- $ -- $ --
Interest 3,333,665 1,412,129 5,764,320 35,993,185** 1,492,790 6,929,500
Less: Foreign taxes withheld (51,418) -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME 4,566,493 1,412,129 5,836,169 35,993,185 1,492,790 6,929,500
- ------------------------------------------------------------------------------------------------------------------------------------
EXPENSES:
Advisory and administration fees 478,553 91,406 322,161 1,895,373 72,503 308,751
Distribution fees
Class A 174,949 35,354 140,376 119,848 41,202 --
Class B 90,000 94,182 15,773 4,491,350 7,947 --
Class C 116,692 22,109 105,233 912 17,224 --
Blue Sky fees 43,324 21,774 34,905 73,875 20,681 32,659
Transfer agent fees 215,116 31,448 84,266 537,482 17,455 181,790
Trustees' fees 3,080 730 2,028 12,702 563 2,911
Custody and accounting expenses 36,212 23,839 30,669 86,860 22,969 35,321
Professional fees 36,481 8,637 24,004 150,433 6,679 34,473
Registration expenses 10,700 2,534 7,042 44,127 1,959 10,112
Amortization of deferred
organization expenses 7,394 5,215 8,798 -- 21,141 5,987
Other expenses 26,666 6,045 16,992 105,444 4,674 24,261
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSES BEFORE WAIVER 1,239,167 343,273 792,247 7,518,406 234,997 636,265
Less: Expenses waived or borne by
the adviser -- (35,084) (24,174) (68,899) (59,817) (18,762)
- ------------------------------------------------------------------------------------------------------------------------------------
Net expenses 1,239,167 308,189 768,073 7,449,507 175,180 617,503
- ------------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME (LOSS) 3,327,326 1,103,940 5,068,096 28,543,678 1,317,610 6,311,997
====================================================================================================================================
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS
REALIZED GAIN (LOSS) ON:
Investments 12,648,691 314,282 1,815,242 6,472,598 208,995 491
Futures (31,518) -- -- -- -- --
Written options 33,551 -- 64,996 256,803 -- --
Foreign currency
related transactions (44,738) -- 33,994 -- -- --
INCREASE (DECREASE) IN
UNREALIZED APPRECIATION/
DEPRECIATION ON:
Investments (9,995,409) 87,364 1,941,943 13,314,613 242,914 --
Futures -- -- -- -- -- --
Written options (1,004) -- (2,967) 8,859 -- --
Foreign currency
related transactions 3,362 -- 36,727 -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain
(loss) on investments 2,612,935 401,646 3,889,935 20,052,873 451,909 491
- ------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE)
IN NET ASSETS RESULTING
FROM OPERATIONS $ 5,940,261 $ 1,505,586 $ 8,958,031 $ 48,596,551 $ 1,769,519 $ 6,312,488
====================================================================================================================================
</TABLE>
* GE Money Market Fund is a no load fund offering only one class of shares to
all investors.
** Income attributable to security lending activity, net of rebate expenses,
for the GE Government Securities Fund was $384,628.
- ----------
See Notes to Financial Statements.
73
<PAGE>
STATEMENTS OF CHANGES
IN NET ASSETS
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE
INTERNATIONAL GLOBAL PREMIER GROWTH
EQUITY EQUITY EQUITY
FUND FUND FUND
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE)
IN NET ASSETS
OPERATIONS:
Net investment
income/(loss) $ 100,619 $ 563,474 $ 136,320 $ 154,615 $ 44,149 $ 8,169
Net realized gain
(loss) on investments,
futures, written options,
and foreign currency
related transactions 17,619,722 2,350,213 2,517,115 5,416,080 1,198,776 140,932
Net increase (decrease)
in unrealized
appreciation/depreciation (21,297,740) 12,454,659 (9,215,341) 3,302,780 1,054,296 2,142,048
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
from operations (3,577,399) 15,368,346 (6,561,906) 8,873,475 2,297,221 2,291,149
- ------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income
Class A -- (31,255) -- -- -- --
Class B -- -- -- -- -- --
Class C -- (6,212) (24,430) (75,298) (13,202) --
Class D (224,494) (492,285) (90,621) (111,661) (17,092) --
In excess of net
investment income
Class A -- -- -- -- -- --
Class B -- -- -- -- -- --
Class C -- -- -- -- -- --
Class D -- -- -- -- -- --
Tax return of capital
Class A -- -- -- -- -- --
Class B -- -- -- -- -- --
Class C -- -- -- -- -- --
Class D -- -- -- -- -- --
Net realized gains
Class A (3,380,824) (262,419) (150,721) (41,620) (32,269) --
Class B (115,286) (8,157) (99,362) (36,858) (11,673) --
Class C (1,110,552) (106,194) (3,436,488) (1,688,506) (130,090) --
Class D (14,195,464) (1,792,954) (2,293,450) (832,366) (90,458) --
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS (19,026,620) (2,699,476) (6,095,072) (2,786,309) (294,784) --
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease)
in net assets from
operations and
distributions (22,604,019) 12,668,870 (12,656,978) 6,087,166 2,002,437 2,291,149
- ------------------------------------------------------------------------------------------------------------------------------------
SHARE TRANSACTIONS:
Proceeds from
sale of shares
Class A 15,760,753 9,346,593 621,999 907,794 5,068,340 1,613,168
Class B 917,197 145,617 440,879 274,406 1,665,872 394,141
Class C 1,841,361 2,763,355 3,978,342 6,488,610 8,332,734 6,940,203
Class D 52,750,459 61,528,741 7,111,585 12,920,814 1,303,750 4,709,150
Value of
distributions
reinvested
Class A 3,380,724 292,984 150,788 41,520 32,272 --
Class B 106,474 6,989 99,333 36,754 11,511 --
Class C 1,074,389 107,698 3,342,507 1,735,843 140,941 --
Class D 14,343,411 2,285,228 2,384,063 944,022 107,550 --
Cost of shares
redeemed
Class A (14,299,215) (2,710,964) (522,162) (3,599,332) (873,788) (352,602)
Class B (306,317) (21,353) (178,609) (117,375) (99,702) --
Class C (1,101,264) (669,241) (6,992,560) (5,528,374) (1,489,425) (695,771)
Class D (111,605,714) (61,958,762) (12,087,216) (3,488,049) (342,129) --
Proceeds from
acquisition of fund -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase
(decrease) from
share transactions (37,137,742) 11,116,885 (1,651,051) 10,616,633 13,857,926 12,608,289
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCREASE
(DECREASE)
IN NET ASSETS (59,741,761) 23,785,755 (14,308,029) 16,703,799 15,860,363 14,899,438
NET ASSETS
Beginning of period 98,975,306 75,189,551 60,163,154 43,459,355 14,899,438 --
- ------------------------------------------------------------------------------------------------------------------------------------
End of period $39,233,545 $98,975,306 $45,855,125 $60,163,154 $30,759,801 $14,899,438
====================================================================================================================================
UNDISTRIBUTED
(OVERDISTRIBUTED)
NET INVESTMENT
INCOME, END OF PERIOD $ (177,615) $ (15,699) $ (91,940) $ (20,833) $ 106,765 $ 11,168
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE
U.S. MID-CAP
EQUITY GROWTH
FUND FUND
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
30, 1998 30, 1997 30, 1998 30, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE)
IN NET ASSETS
OPERATIONS:
Net investment
income/(loss) $ 4,526,425 $ 3,892,364 $ (286,747) $ (386,718)
Net realized gain
(loss) on investments,
futures, written options,
and foreign currency
related transactions 45,962,987 32,007,920 (1,477,789) 19,179,275
Net increase (decrease)
in unrealized
appreciation/depreciation (38,784,755) 66,505,232 (5,051,237) (7,395,902)
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
from operations 11,704,657 102,405,516 (6,815,773) 11,396,655
- ------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income
Class A (481,181) (332,785) -- --
Class B (32,171) (58,927) -- --
Class C (855,823) (758,606) -- --
Class D (2,463,920) (2,607,415) -- --
In excess of net
investment income
Class A -- -- -- --
Class B -- -- -- --
Class C -- -- -- --
Class D -- -- -- --
Tax return of capital
Class A -- -- (25,589) --
Class B -- -- (73,996) --
Class C -- -- (1,885) --
Class D -- -- -- --
Net realized gains
Class A (5,530,158) (2,630,802) (4,618,651) --
Class B (1,340,093) (765,822) (13,413,646) --
Class C (8,562,260) (5,196,483) (341,767) --
Class D (18,140,095) (14,080,728) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS (37,405,701) (26,431,568) (18,475,534) --
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease)
in net assets from
operations and
distributions (25,701,044) 75,973,948 (25,291,307) 11,396,655
- ------------------------------------------------------------------------------------------------------------------------------------
SHARE TRANSACTIONS:
Proceeds from
sale of shares
Class A 39,908,081 32,487,800 2,242,341 651,141
Class B 9,344,808 4,876,961 3,303,026 4,138,692
Class C 39,694,037 33,202,755 2,724,759 --
Class D 148,277,145 54,548,257 749,812 --
Value of
distributions
reinvested
Class A 6,011,339 2,963,444 4,628,103 --
Class B 1,323,764 808,909 13,080,553 434
Class C 9,238,804 5,854,736 343,652 --
Class D 20,389,435 16,688,138 -- --
Cost of shares
redeemed
Class A (22,060,445) (14,806,398) (1,094,533) (763,248)
Class B (2,702,360) (1,027,087) (8,646,813) (8,096,306)
Class C (17,397,625) (9,333,878) (662,619) --
Class D (83,986,003) (47,701,146) (194,710) --
Proceeds from
acquisition of fund -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase
(decrease) from
share transactions 148,040,980 78,562,491 16,473,571 (4,069,287)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCREASE
(DECREASE)
IN NET ASSETS 122,339,936 154,536,439 (8,817,736) 7,327,368
NET ASSETS
Beginning of period 390,758,459 236,222,020 43,165,377 35,838,009
- ------------------------------------------------------------------------------------------------------------------------------------
End of period $513,098,395 $390,758,459 $34,347,641 $43,165,377
====================================================================================================================================
UNDISTRIBUTED
(OVERDISTRIBUTED)
NET INVESTMENT
INCOME, END OF PERIOD $ 3,710,271 $ 3,003,982 $ 142,908 $ --
</TABLE>
* GE Money Market Fund is a no load Fund offering only one class of shares to
all investors.
- ----------
See Notes to Financial Statements.
74
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE
VALUE STRATEGIC TAX-
EQUITY INVESTMENT EXEMPT
FUND FUND FUND
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE)
IN NET ASSETS
OPERATIONS:
Net investment
income/(loss) $ 77,791 $ (4,103) $ 3,327,326 $ 2,776,537 $ 1,103,940 $ 1,151,538
Net realized gain
(loss) on investments,
futures, written options,
and foreign currency
related transactions 2,575,075 16,217,779 12,605,986 3,696,675 314,282 (55,544)
Net increase (decrease)
in unrealized
appreciation/depreciation 139,963 (1,649,840) (9,993,051) 14,813,759 87,364 550,991
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
from operations 2,792,829 14,563,836 5,940,261 21,286,971 1,505,586 1,646,985
- ------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income
Class A -- (21,440) (814,947) (461,097) (305,754) (767,703)
Class B -- (2,231) (111,753) (63,980) (359,269) (421,200)
Class C -- -- (927,488) (691,773) (404,359) (4,518)
Class D -- -- (936,622) (1,079,566) (35,569) (1,880)
In excess of net
investment income
Class A -- -- -- -- -- --
Class B -- -- -- -- -- --
Class C -- -- -- -- -- --
Class D -- -- -- -- -- --
Tax return of capital
Class A -- -- -- -- -- --
Class B -- -- -- -- -- --
Class C -- -- -- -- -- --
Class D -- -- -- -- -- --
Net realized gains
Class A 2,507,957) (475,283) (1,344,753) (243,915) -- --
Class B (13,807,227) (2,729,341) (230,774) (48,212) -- --
Class C (117,795) -- (1,380,557) (353,335) -- --
Class D -- -- (1,269,011) (478,496) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS (16,432,979) (3,228,295) (7,015,905) (3,420,374) (1,104,951) (1,195,301)
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease)
in net assets from
operations and
distributions (13,640,150) 11,335,541 (1,075,644) 17,866,597 400,635 451,684
- ------------------------------------------------------------------------------------------------------------------------------------
SHARE TRANSACTIONS:
Proceeds from
sale of shares
Class A
Class B 7,573,642 823,722 13,892,894 21,737,339 323,984 93,600
Class C 8,084,776 10,675,955 6,179,827 1,584,741 519,672 1,106,385
Class D 2,734,074 -- 13,331,124 11,916,896 3,461,252 1,653
Value of 2,145,188 -- 35,615,406 14,484,361 2 --
distributions
reinvested
Class A 2,501,541 496,574 2,157,656 703,204 27,838 27,172
Class B 13,405,062 2,619,315 331,559 111,422 253,474 298,059
Class C 117,795 -- 2,232,380 1,017,319 337,596 --
Class D -- -- 2,205,624 1,558,062 26,477 --
Cost of shares
redeemed
Class A (1,991,397) (589,327) (22,533,547) (13,641,813) (11,220,260) (594,559)
Class B (11,473,261) (10,241,538) (984,281) (507,717) (2,153,769) (1,863,309)
Class C (274,073) -- (6,507,447) (4,581,193) (1,212,139) (2,050)
Class D (578,798) -- (23,511,013) (19,955,143) (3,234,639) --
Proceeds from
acquisition of fund -- -- -- -- -- 13,051,759
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase
(decrease) from
share transactions 22,244,549 3,784,701 22,410,182 14,427,478 (12,870,512) 12,118,710
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCREASE
(DECREASE)
IN NET ASSETS 8,604,399 15,120,242 21,334,538 32,294,075 (12,469,877) 12,570,394
NET ASSETS
Beginning of period 54,271,285 39,151,043 123,855,829 91,561,754 37,923,478 25,353,084
- ------------------------------------------------------------------------------------------------------------------------------------
End of period $62,875,684 $54,271,285 $145,190,367 $123,855,829 $25,453,601 $37,923,478
====================================================================================================================================
UNDISTRIBUTED
(OVERDISTRIBUTED)
NET INVESTMENT
INCOME, END OF PERIOD $ 173,039 $ -- $ 2,577,260 $ 2,080,037 $ 76,824 $ 73,800
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE GE
FIXED GOVERNMENT SHORT-TERM MONEY
INCOME SECURITIES GOVERNMENT MARKET
FUND FUND FUND FUND*
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE)
IN NET ASSETS
OPERATIONS:
Net investment
income/(loss) $5,068,096 $3,870,453 $28,543,678 $37,145,128 $1,317,610 $ 749,505 $6,311,997 $5,081,919
Net realized gain
(loss) on
investments, futures,
written options,
and foreign currency
related transactions 1,914,232 994,264 6,729,401 3,276,687 208,995 44,179 491 (474)
Net increase
(decrease)
in unrealized
appreciation/
depreciation 1,975,703 1,049,251 13,323,472 (1,376,782) 242,914 49,129 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
from operations 8,958,031 5,913,968 48,596,551 39,045,033 1,769,519 842,813 6,312,488 5,081,445
- ------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income
Class A (1,446,282) (888,166) (1,482,314) (1,774,779) (439,601) (38,125) -- --
Class B (74,005) (80,626) (24,576,037) (34,870,480) (46,925) (5,375) -- --
Class C (2,279,994) (1,886,051) (19,806) -- (385,296) (265,636) (6,311,997) (5,083,754)
Class D (1,154,520) (1,047,014) -- -- (476,763) (453,643) -- --
In excess of net
investment income
Class A (48,982) -- (137,534) -- -- -- -- --
Class B (2,506) -- (2,280,240) -- -- -- -- --
Class C (77,218) -- (1,838) -- -- -- -- --
Class D (39,101) -- -- -- -- -- -- --
Tax return of capital
Class A -- -- -- (14,200) -- -- -- --
Class B -- -- -- (278,995) -- -- -- --
Class C -- -- -- -- -- -- -- --
Class D -- -- -- -- -- -- -- --
Net realized gains
Class A -- -- -- -- (12,916) (469) -- --
Class B -- -- -- -- (1,764) (143) -- --
Class C -- -- -- -- (11,323) (5,468) -- --
Class D -- -- -- -- (13,601) (9,662) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS (5,122,608) (3,901,857) (28,497,769) (36,938,454) (1,388,189) (778,521) (6,311,997) (5,083,754)
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease)
in net assets from
operations and
distributions 3,835,423 2,012,111 20,098,782 2,106,579 381,330 64,292 491 (2,309)
- ------------------------------------------------------------------------------------------------------------------------------------
SHARE TRANSACTIONS:
Proceeds from
sale of shares
Class A 24,826,414 7,378,651 5,748,451 6,420,060 1,913,508 1,007,456 -- --
Class B 454,176 178,891 1,975,186 1,910,220 139,431 1,016,179 -- --
Class C 18,055,834 10,863,901 1,072,103 -- 3,768,403 2,442,574 249,769,855 234,308,541
Class D 22,825,479 9,329,217 -- -- 2,038,639 4,875,679 -- --
Value of
distributions
reinvested
Class A 1,490,154 877,956 1,024,680 953,206 447,377 32,067 -- --
Class B 66,019 73,560 14,233,382 18,663,303 39,774 2,461 -- --
Class C 1,972,220 1,552,771 15,945 -- 364,028 249,182 6,056,055 4,838,099
Class D 1,189,393 1,049,141 -- -- 490,364 456,946 -- --
Cost of shares
redeemed
Class A (10,689,227) (5,791,665) (7,282,931) (12,540,641) (874,765) (164,903) -- --
Class B (130,035) (569,926) (158,884,041) (246,487,916) (327,201) (1,118,841) -- --
Class C (7,139,096) (6,396,220) (144,030) -- (1,369,667) (1,048,136) (216,190,647) (210,956,472)
Class D (11,100,710) (13,753,765) -- -- (934,445) (5,443,242)
Proceeds from -- --
acquisition
of fund -- -- -- -- -- 7,069,264 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase
(decrease) from
share transactions 41,820,621 4,792,512 (142,241,255) (231,081,768) 5,695,446 9,376,686 39,635,263 28,190,168
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCREASE
(DECREASE)
IN NET ASSETS 45,656,044 6,804,623 (122,142,473) (228,975,189) 6,076,776 9,440,978 39,635,754 28,187,859
NET ASSETS
Beginning of period 71,343,850 64,539,227 547,330,366 776,305,555 21,364,826 11,923,848 114,029,544 85,841,685
- ------------------------------------------------------------------------------------------------------------------------------------
End of period $116,999,894 $71,343,850 $425,187,893 $547,330,366 $27,441,602 $21,364,826 $153,665,298 $114,029,544
====================================================================================================================================
UNDISTRIBUTED
(OVERDISTRIBUTED)
NET INVESTMENT
INCOME,
END OF PERIOD $ 304,228 $ 149,640 $ 2,051,756 $ (417,464) $ 16,033 $ 13,243 $ 60,209 $ 55,271
</TABLE>
75
<PAGE>
STATEMENTS OF CHANGES
IN NET ASSETS (CONTINUED)
CHANGES IN FUND SHARES
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE GE
INTERNATIONAL GLOBAL PREMIER GROWTH U.S.
EQUITY EQUITY EQUITY EQUITY
FUND FUND FUND FUND
- ------------------------------------------------------------------------------------------------------------------------------------
YEAR YEAR YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED ENDED ENDED
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A:
Shares sold by subscription 849,142 501,638 27,204 38,598 262,567 96,889 1,344,147 1,229,311
Issued for distributions
reinvested 204,348 16,618 7,432 1,932 1,793 -- 223,670 127,023
Shares redeemed (784,389) (145,418) (24,111) (162,855) (43,151) (20,738) (751,831) (608,801)
Shares from acquisitions
of fund -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in fund shares 269,101 372,838 10,525 (122,325) 221,209 76,151 815,986 747,533
====================================================================================================================================
CLASS B:
Shares sold by subscription 52,960 7,935 18,635 12,065 82,590 24,530 324,472 194,796
Issued for distributions
reinvested 6,550 400 4,967 1,724 643 -- 52,027 35,856
Shares redeemed (17,677) (1,175) (8,038) (5,170) (4,985) -- (94,240) (42,077)
Shares from acquisitions
of fund -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in fund shares 41,833 7,160 15,564 8,619 78,248 24,530 282,259 188,575
====================================================================================================================================
CLASS C:
Shares sold by
subscription 99,589 149,455 169,269 284,215 404,093 440,229 1,354,049 1,319,280
Issued for
distributions
reinvested 64,512 6,092 163,280 80,285 7,816 -- 349,552 255,106
Shares redeemed (61,675) (36,301) (307,386) (242,109) (72,985) (43,164) (595,640) (372,791)
Shares from
acquisitions of fund -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in
fund shares 102,426 119,246 25,163 122,391 338,924 397,065 1,107,961 1,201,595
====================================================================================================================================
CLASS D:
Shares sold by
subscription 2,982,399 3,325,700 304,658 564,945 66,412 313,891 4,892,297 2,185,018
Issued for distributions
reinvested 858,464 129,182 116,751 43,705 5,965 -- 774,086 729,058
Shares redeemed (6,505,018) (3,338,513) (570,743) (151,578) (16,534) -- (2,895,887) (1,839,879)
Shares from acquisitions
of fund -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in fund shares (2,664,155) 116,369 (149,334) 457,072 55,843 313,891 2,770,496 1,074,197
====================================================================================================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE GE
MID-CAP VALUE STRATEGIC TAX-
GROWTH EQUITY INVESTMENT EXEMPT
FUND FUND FUND FUND
- ------------------------------------------------------------------------------------------------------------------------------------
YEAR YEAR YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED ENDED ENDED
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A:
Shares sold by subscription 226,004 45,252 750,562 69,116 566,785 1,013,955 27,965 7,816
Issued for distributions
reinvested 489,229 -- 269,272 46,979 94,758 33,678 2,387 2,371
Shares redeemed (107,318) (52,136) (189,310) (48,223) (955,787) (633,971) (968,784) (51,517)
Shares from acquisitions
of fund -- -- -- -- -- -- -- 48,461
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in fund shares 607,915 (6,884) 830,524 67,872 (294,244) 413,662 (938,432) 7,131
====================================================================================================================================
CLASS B:
Shares sold by subscription 331,551 293,713 769,421 910,258 257,968 73,254 44,630 96,638
Issued for distributions
reinvested 1,459,769 32 1,461,859 248,003 14,710 5,385 21,736 25,858
Shares redeemed (852,340) (553,350) (1,076,407) (830,850) (40,768) (23,418) (184,662) (162,031)
Shares from acquisitions
of fund -- -- -- -- -- -- -- 107,527
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in fund shares 938,980 (259,605) 1,154,873 327,411 231,910 55,221 (118,296) 67,992
====================================================================================================================================
CLASS C:
Shares sold by
subscription 226,192 -- 245,325 -- 540,921 542,727 285,575 137
Issued for
distributions
reinvested 36,751 -- 13,339 -- 97,714 48,606 27,838 --
Shares redeemed (62,200) -- (25,716) -- (267,511) (209,785) (99,769) (170)
Shares from
acquisitions of fund -- -- -- -- -- -- -- 664,095
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in
fund shares 200,743 -- 232,948 -- 371,124 381,548 213,644 664,062
====================================================================================================================================
CLASS D:
Shares sold by
subscription 72,759 -- 204,968 -- 1,414,703 660,856 -- --
Issued for distributions
reinvested -- -- -- -- 96,568 74,407 2,197 --
Shares redeemed (18,737) -- (52,763) -- (940,177) (934,956) (266,126) --
Shares from acquisitions
of fund -- -- -- -- -- -- -- 265,902
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in fund shares 54,022 -- 152,205 -- 571,094 (199,693) (263,929) 265,902
====================================================================================================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GE GE GE GE
FIXED GOVERNMENT SHORT-TERM MONEY
INCOME SECURITIES GOVERNMENT MARKET
FUND FUND FUND FUND*
- ------------------------------------------------------------------------------------------------------------------------------------
YEAR YEAR YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED ENDED ENDED
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997 30, 1998 30, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A:
Shares sold by subscription 2,027,068 622,149 666,957 759,978 161,494 83,835 -- --
Issued for distributions
reinvested 121,804 74,052 118,722 112,984 37,766 2,714 -- --
Shares redeemed (874,272) (490,365) (843,431) (1,487,386) (73,896) (13,950)
Shares from acquisitions
of fund -- -- -- -- -- 514,537 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in fund shares 1,274,600 205,836 (57,752) (614,424) 125,364 587,136 -- --
====================================================================================================================================
CLASS B:
Shares sold by subscription 36,886 15,044 228,535 226,547 11,782 87,200 -- --
Issued for distributions
reinvested 5,393 6,199 1,645,646 2,209,474 3,358 208 -- --
Shares redeemed (10,610) (48,093) (18,393,279) (29,214,346) (27,658) (94,431)
Shares from acquisitions
of fund -- -- -- -- -- 81,740 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in fund shares 31,669 (26,850) (16,519,098) (26,778,325) (12,518) 74,717 -- --
====================================================================================================================================
CLASS C:
Shares sold by
subscription 1,476,623 915,906 106,023 -- 318,037 206,389 249,769,855 234,308,541
Issued for
distributions
reinvested 161,153 130,841 1,575 -- 30,702 21,072 6,056,055 4,838,098
Shares redeemed (583,721) (539,791) (14,221) -- (115,358) (88,632) (216,190,647) (210,956,472)
Shares from
acquisitions of fund -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in
fund shares 1,054,055 506,956 93,377 -- 233,381 138,829 39,635,263 28,190,167
====================================================================================================================================
CLASS D:
Shares sold by
subscription 1,861,485 787,978 -- -- 172,114 412,203 -- --
Issued for distributions
reinvested 97,133 88,445 -- -- 41,521 38,673 -- --
Shares redeemed (907,273) (1,163,393) -- -- (78,863) (460,152) -- --
Shares from acquisitions
of fund -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in fund shares 1,051,345 (286,970) -- -- 134,772 (9,276) -- --
====================================================================================================================================
</TABLE>
* GE Money Market Fund is a no load Fund offering only one class of shares to
all investors.
- ----------
See Notes to Financial Statements.
76 & 77
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
1. ORGANIZATION OF THE FUNDS
GE Funds (the "Trust") is registered under the Investment Company Act of 1940,
as amended, (the "1940 Act") as an open-end management investment company. The
Trust was organized as a Massachusetts business trust on August 10, 1992, and is
authorized to issue an unlimited number of shares. It is comprised of sixteen
investment portfolios (each a "Fund" and collectively the "Funds") only twelve
of which are currently being offered, as follows: GE International Equity Fund,
GE Global Equity Fund, GE Premier Growth Equity Fund, GE U.S. Equity Fund, GE
Mid-Cap Growth Fund, GE Value Equity Fund, GE Strategic Investment Fund, GE
Tax-Exempt Fund, GE Fixed Income Fund, GE Government Securities Fund, GE
Short-Term Government Fund and GE Money Market Fund. The Funds (except GE Money
Market Fund) are presently authorized to issue four classes of shares. However,
as of September 30, 1998, only three classes were being offered for the GE
Government Securities Fund.
The commencement dates of the Funds were as follows:
FUND CLASS A CLASS B CLASS C CLASS D
- --------------------------------------------------------------------------------
GE INTERNATIONAL
EQUITY 3/2/1994 3/2/1994 3/2/1994 3/2/1994
- --------------------------------------------------------------------------------
GE GLOBAL EQUITY 1/1/1994 12/22/1993 2/22/1993 11/29/1993
- --------------------------------------------------------------------------------
GE PREMIER
GROWTH EQUITY 12/31/1996 12/31/1996 12/31/1996 12/31/1996
- --------------------------------------------------------------------------------
GE U.S. EQUITY 1/1/1994 12/22/1993 2/22/1993 11/29/1993
- --------------------------------------------------------------------------------
GE MID-CAP
GROWTH 9/8/1993 9/8/1993 10/2/1997 1/5/1998
- --------------------------------------------------------------------------------
GE VALUE EQUITY 9/8/1993 9/8/1993 10/2/1997 1/5/1998
- --------------------------------------------------------------------------------
GE STRATEGIC
INVESTMENT 1/1/1994 12/22/1993 2/22/1993 11/29/1993
- --------------------------------------------------------------------------------
GE TAX-EXEMPT 9/8/1993 9/8/1993 9/26/1997 9/26/1997
- --------------------------------------------------------------------------------
GE FIXED INCOME 1/1/1994 12/22/1993 2/22/1993 11/29/1993
- --------------------------------------------------------------------------------
GE GOVERNMENT
SECURITIES 9/8/1993 4/22/1987 10/28/1997 --
- --------------------------------------------------------------------------------
GE SHORT-TERM
GOVERNMENT 3/2/1994 3/2/1994 3/2/1994 3/2/1994
- --------------------------------------------------------------------------------
GE MONEY MARKET -- -- 2/22/1993 --
- --------------------------------------------------------------------------------
MAXIMUM SALES LOAD IMPOSED ON PURCHASES OF CLASS A SHARES (AS A PERCENTAGE OF
OFFERING PRICE):
5.75% 4.25% 2.50%
- --------------------------------------------------------------------------------
GE International Equity Fund GE Tax-Exempt Fund GE Short-Term
GE Global Equity Fund GE Fixed Income Fund Government Fund
GE Premier Growth GE Government
Equity Fund Securities Fund
GE U.S. Equity Fund
GE Mid-Cap Growth Fund
GE Value Equity Fund
GE Strategic Investment Fund
There is no front-end sales load imposed on purchases of Class A shares of $1
million or more.
MAXIMUM CONTINGENT DEFERRED SALES CHARGE IMPOSED ON REDEMPTIONS OF CLASS B
SHARES (AS A PERCENTAGE OF REDEMPTION PROCEEDS):
3.00% 4.00%
- --------------------------------------------------------------------------------
GE Tax-Exempt Fund GE International Equity Fund
GE Fixed Income Fund GE Global Equity Fund
GE Government Securities Fund GE Premier Growth Equity Fund
GE Short-Term Government Fund GE U.S. Equity Fund
GE Mid-Cap Growth Fund
GE Value Equity Fund
GE Strategic Investment Fund
Except as described in the next paragraph, the maximum contingent deferred sales
charge for Class B redemptions for all Funds, after the first year, is as
follows: 3.00% within the second year, 2.00% within the third year, 1.00% within
the fourth year, and 0.00% thereafter.
The maximum contingent deferred sales charge for Class B redemptions from shares
acquired, either by purchase or exchange, as a result of the combination on
September 26, 1997 of the Investors Trust Funds, with the Trust is as follows:
5.00% within the first year, 4.00% within the second year, 3.00% within the
third year, 2.00% within the fourth year, 1.00% within the fifth year, and 0.00%
thereafter.
A maximum contingent deferred sales charge of 1.00% is charged on redemptions of
Class A shares that were not subject to a front-end sales load upon purchase.
No front-end load or back-end sales charges, redemption fees or exchange fees
are assessed by the Trust with respect to Class C shares, Class D shares or
shares of GE Money Market Fund.
78
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 at the date of the
financial statements and the reported amounts of income and expenses during the
reporting period. Actual results may differ from those estimates.
The following summarizes the significant accounting policies of the Trust:
SECURITY VALUATION AND TRANSACTIONS
Securities for which exchange quotations are readily available are valued at the
last sale price, or if no sales occurred on that day, at the last quoted bid
price. Certain fixed income securities are valued by a dealer or by a pricing
service based upon a computerized matrix system, which considers market
transactions and dealer supplied valuations. Valuations for municipal bonds are
based on prices obtained from a qualified municipal bond pricing service; prices
represent the mean of the bid and ask of the secondary market. Futures contracts
are valued at the settlement price established each day by the board of trade or
exchange on which they are principally traded. Options are valued at the last
sale price, or if no sales occurred on that day, at the last quoted bid price.
Forward foreign currency contracts are valued at the mean between the bid and
the offered forward rates as last quoted by a recognized dealer. Short-term
investments maturing within 60 days are valued at amortized cost or original
cost plus accrued interest, both of which approximate current value. Fund
positions which cannot be valued as set forth above are valued at fair value
determined under procedures approved by the Board of Trustees of the Funds.
In accordance with Rule 2a-7 of the 1940 Act, GE Money Market Fund values its
securities initially at cost and, thereafter, securities are assumed to have a
constant amortization to maturity of any discount or premium. Amortized cost
approximates fair value.
Transactions are accounted for as of the trade date. Realized gains and losses
on investments sold are recorded on the basis of specific identified cost for
both financial statement and federal tax purposes.
Each Fund's income, expenses (other than advisory, administration, and
distribution fees which are accrued by each applicable class based upon
contractual rates specified to that class) and realized and unrealized gains and
losses are allocated proportionally each day among the classes based upon the
relative net assets of each class. During the year the funds changed their
method for accruing blue sky fees and transfer agent fees to be consistent with
the other operating expenses. Previously the fund accrued such expenses on a
class specific basis.
FOREIGN CURRENCY
Accounting records of the Funds are maintained in U.S. dollars. Investment
securities and other assets and liabilities denominated in a foreign currency
are translated to U.S. dollars at the prevailing rates of exchange at period
end. Purchases and sales of securities, income receipts and expense payments are
translated into U.S. dollars at the prevailing exchange rate on the respective
dates of the transactions.
The Funds do not isolate the portion of the results of operations resulting from
changes in foreign exchange rates on investments from the fluctuations arising
from changes in their market prices. Such fluctuations are included in net
realized or unrealized gain or loss from investments. Reported net realized
exchange gains or losses from foreign currency transactions represent gains or
losses on sales of foreign currencies, currency gains or losses between the
trade date and the settlement date on securities transactions, net realized
gains and losses on sales and maturities of forward foreign currency contracts,
and the difference between the amounts of foreign investment income and
withholding taxes accrued on the Funds' books and the U.S. dollar equivalent of
the amounts actually received or paid. Net unrealized exchange gains and losses
arising from changes in the value of assets and liabilities as a result of
changes in exchange rates are included as increases or decreases in unrealized
appreciation/depreciation on foreign currency related transactions.
INCOME TAXES
The Funds intend to comply with all sections of the Internal Revenue Code
applicable to regulated investment companies and to distribute taxable income,
tax-exempt income, and realized gains to its shareholders and, therefore, no
provision for federal income tax has been made. Each Fund is treated as a
separate taxpayer for federal income tax purposes.
79
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
As of September 30, 1998, the following Funds have capital loss carryovers as
indicated below. The capital loss carryover of the GE Tax-Exempt Fund includes a
capital loss carryover of $42,651 acquired as a result of the reorganization
with the Investors Trust Tax Free Fund. The capital loss carryover is available
to offset future realized capital gains to the extent provided in the Internal
Revenue Code and regulations thereunder. To the extent that these carryover
losses are used to offset future capital gains, it is probable that the gains so
offset will not be distributed to shareholders because they would be taxable as
ordinary income.
FUND AMOUNT EXPIRES
- --------------------------------------------------------------------------------
GE Tax-Exempt Fund $ 428,324 2004
GE Fixed Income Fund 684,519 2003
38,636 2004
445,270 2005
GE Government
Securities Fund 80,657,745 2002
107,525,597 2003
1,748,819 2004
GE Money Market Fund 3,153 2003
5,688 2005
Any net capital and currency losses incurred after October 31, within each
Fund's tax year, are deemed to arise on the first day of the Fund's next tax
year if the Fund so elects to defer such losses. The Funds incurred and elected
to defer losses at October 31, 1997 as follows:
FUND CURRENCY CAPITAL
- --------------------------------------------------------------------------------
GE International Equity Fund $235,892 --
GE Global Equity Fund 134,986 --
GE Mid-Cap Growth Fund 57 $1,601,458
GE Strategic Investment Fund 57,568 --
INVESTMENT INCOME
Corporate actions (including cash dividends) are recorded net of non-reclaimable
tax withholdings on the ex-dividend date, except for certain foreign securities
for which corporate actions are recorded as soon after ex-dividend date as such
information becomes available. Interest income is recorded on the accrual basis.
All discounts on taxable bonds and discounts and premiums on tax-exempt bonds
are amortized to call or maturity date, whichever is shorter, using the
effective yield method. For tax-exempt bonds purchased on or after May 1, 1993,
both market discount and original issue discount are amortized.
EXPENSES
Expenses of the Trust which are directly identifiable to a specific Fund are
allocated to that Fund. Expenses which are not directly identifiable to a
specific Fund are allocated in such a manner as deemed equitable, taking into
consideration the nature and type of expense and the relative sizes of the
Funds. All expenses of the Funds are paid by GEIM, investment adviser to the
Funds, and reimbursed by the Funds up to the voluntary expense limitations.
DISTRIBUTIONS TO SHAREHOLDERS
GE Tax-Exempt Fund, GE Fixed Income Fund, GE Government Securities Fund, GE
Short-Term Government Fund and GE Money Market Fund declare investment income
dividends daily and pay them monthly. All other Funds declare and pay dividends
from investment income annually. All Funds declare and pay net realized capital
gains distributions annually. The character of income and gains to be
distributed is determined in accordance with income tax regulations which may
differ from generally accepted accounting principles. These differences include
treatment of realized and unrealized gains and losses on forward foreign
currency contracts, paydown gains and losses on mortgage-backed securities,
losses deferred due to wash sale transactions, and deferred organization
expenses. Reclassifications are made to the Funds' capital accounts to reflect
income and gains available for distribution (or available capital loss
carryovers) under income tax regulations. The calculation of net investment
income per share in the Financial Highlights table excludes these adjustments.
During any particular year, net realized gains from investment transactions in
excess of any applicable capital loss carryforwards would be taxable to the
Funds if not distributed and, therefore, will be declared and paid to their
shareholders annually.
GE Government Securities Fund will declare a distribution each day in an amount
based on periodic projections of its future net investment income. Consequently,
the amount of each daily distribution may differ from actual net investment
income.
DEFERRED ORGANIZATIONAL COSTS
Organizational expenses applicable to the Funds have been deferred and are being
amortized on a straight-line basis over a period of five years from commencement
of investment operations.
WHEN-ISSUED SECURITIES AND FORWARD COMMITMENTS
The Funds may purchase and sell securities on a when-issued or forward
commitment basis. These transactions are arrangements in which the Funds
purchase and sell securities with payment and delivery scheduled for a future
time. Settlement dates may be a month or more after entering into these
transactions, and the purchase of securities
80
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
on a when-issued or forward commitment basis involves a risk of loss if the
value of the underlying security declines prior to the settlement date. The
price of the underlying securities and the date when these securities will be
delivered and paid for are fixed at the time the transaction is negotiated. This
may increase the risk if the other party involved in the transaction fails to
deliver and causes the Funds to subsequently invest at less advantageous prices
and yields. In connection with such purchases, the Funds maintain cash or liquid
assets in an amount equal to purchase commitments for such underlying securities
until settlement date and for sales commitments the Funds maintain equivalent
deliverable securities as "cover" for the transaction. Unsettled commitments are
valued at current market value of the underlying security. Daily fluctuations in
the value of such contracts are recorded as unrealized gains or losses. The
Funds will not enter into such agreements for the purpose of investment
leverage.
FOREIGN SECURITIES
All Funds may invest in foreign securities, subject to certain limitations.
There are certain additional risks involved when investing in foreign securities
(including those denominated in foreign currencies) that are not inherent in
domestic securities. These risks may involve foreign currency exchange rate
fluctuations; changes in foreign exchange control regulations; application of
foreign tax laws, including withholding taxes; lack of uniform accounting,
auditing and financial reporting standards; and increased uncertainty about
changes in governmental administration or economic or monetary policy (in the
United States or abroad). The Funds may be subject to restrictions on the
repatriation or foreign currencies and may be limited on the use or removal of
its assets.
FOREIGN CURRENCY CONTRACTS
A foreign currency contract is an agreement between two parties to buy or sell
currency at a set price on a future date. Certain portfolios may enter into
foreign currency contracts to facilitate transactions in foreign denominated
securities and to manage the Fund's currency exposure. Contracts to sell are
generally used to hedge the Fund's investments against currency fluctuations or
to offset a previous contract to buy. Contracts to buy are generally used to
hedge exposure to foreign currencies or to offset a previous contract to sell.
Currency exposure exists during the period that a foreign denominated investment
is held or during a period between the trade date and settlement date of an
investment which is purchased or sold. These contracts involve market risk in
excess of the unrealized gain or loss reflected in the fund's Statement of
Assets and Liabilities. Losses may arise from changes in the value of foreign
currency or if the counterparties do not perform under the contracts' terms.
REPURCHASE AGREEMENTS
Each of the Funds may enter into repurchase agreements. The Funds value the
underlying collateral daily on a mark-to-market basis to determine that the
value, including accrued interest, is at least equal to the repurchase price. In
the event of default of the obligation to repurchase, the Funds have the right
to liquidate the collateral and apply the proceeds in satisfaction of the
obligation. There is the risk that the collateral may be insufficient to meet
the obligation in the event of default.
FUTURES CONTRACTS AND OPTIONS
Each Fund, other than GE Money Market Fund, may invest in futures contracts and
purchase and write options, subject to certain limitations. The Funds may invest
in futures and options contracts for the following reasons: (1) for the purpose
of hedging against the effects of changes in the value of portfolio securities
or other investments due to anticipated changes in interest rates, stock market
conditions and currency market conditions, (2) to gain stock, bond, or currency
market exposure for accumulating and residual cash positions, (3) for duration
management, and (4) when such transactions are an economically appropriate way
to reduce risks inherent in the management of a Fund. Buying futures, writing
puts and buying calls tend to increase a Fund's exposure to the underlying
instrument. Selling futures, buying puts and writing calls tend to decrease a
Fund's exposure to the underlying instrument, or hedge other Fund investments. A
Fund will not enter into a transaction involving futures and options on futures
for speculative purposes.
These investments involve, to varying degrees, elements of market risk and risks
in excess of the amount recognized in the Statements of Assets and Liabilities.
The face or contract amounts, shown in the Schedule of Investments under the
captions "Other Information", "Call Options" and "Put Options" reflect the
extent of the involvement the Funds have in the particular classes of these
instruments. Losses may be caused by an imperfect correlation between movements
in the price of the underlying securities and interest rates and currency.
Losses also may arise if there is an illiquid secondary market for the
instruments, or an inability of counterparties to perform.
81
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
Upon entering into a futures contract, the Funds are required to deposit with
the Funds' custodian in a segregated account, either cash or securities in an
amount (initial margin) equal to a certain percentage of the contract value.
Subsequent payments (variation margin) are made or received by the Funds each
day. The variation margin payments are equal to the daily change in the contract
value and are recorded as unrealized gains and losses. The Funds recognize a
realized gain or loss when the futures contract is closed. The Funds will
realize a gain or loss upon the expiration or closing of an option transaction.
When an option is exercised, the proceeds on the sales of a security as a result
of exercising a written call option, the purchase cost of a security acquired
from exercising a written put option, or the proceeds on the sale of the
security from exercising a purchased put option or cost of the security acquired
from exercising a purchased call option is adjusted by the amount of original
premium received or paid.
SECURITY LENDING
The Funds may loan securities to brokers, dealers, and financial institutions
determined by GEIM to be creditworthy, up to a maximum of 30% (5% in the case of
the GE Tax-Exempt Fund) of the total value of the Fund's assets. The loans of
securities will be secured by collateral in the form of cash or other liquid
assets, which will be segregated and maintained with the custodian in an amount
at least equal to the current market value of the loaned securities. The Funds
receive a lender fee in addition to the interest and dividends on the loaned
securities during the term of the loan. A Fund will receive any gain or loss in
the market value of its loaned securities and of securities in which cash
collateral is invested net of any rebate during the term of the loan. In the
event the counterparty (borrower) does not meet its contracted obligation to
return the securities, the Fund may be exposed to the risk of loss of
reacquiring the loaned securities at prevailing market prices using the proceeds
of the sale of the collateral. At September 30, 1998 the total market value of
securities loaned and the related collateral amounted to $54,208,695 and
$55,219,975, respectively, with regard to the GE Government Securities Fund,
which is the only fund that participated in securities lending.
3. FEES AND COMPENSATION PAID TO AFFILIATES
ADVISORY AND ADMINISTRATION FEES
Compensation of GE Investment Management Incorporated ("GEIM"), a wholly-owned
subsidiary of General Electric Company, for investment advisory and
administrative services, is paid monthly based on the average daily net assets
of each Fund. Until further notice, GEIM has agreed to reduce other operating
expenses (exclusive of advisory, administration and distribution fees) for each
Fund as stated in the following schedule:
Annualized based on average daily net assets
ADVISORY AND LIMITATION OF OTHER
ADMINISTRATION FEES OPERATING EXPENSES
- --------------------------------------------------------------------------------
GE International Equity Fund .80% .30%
GE Global Equity Fund .75% .35%
GE Premier Growth
Equity Fund .60% .30%
GE U.S. Equity Fund* .40% .10%
GE Mid-Cap Growth Fund .60% .30%
GE Value Equity Fund .55% .30%
GE Strategic Investment Fund .35% .30%
GE Tax-Exempt Fund .35% .25%
GE Fixed Income Fund .35% .20%
GE Government
Securities Fund .40% .20%
GE Short-Term
Government Fund .30% .15%
GE Money Market Fund .25% .25%
* Effective January 28, 1998, the GE U.S. Equity Fund changed its Limitation
of Other Operating Expenses. The rate for Limitation of Other Operating
Expenses in effect during a portion of the fiscal year ended September 30,
1997, and the ensuing period through January 28, 1998, for this Fund was
higher than the rate indicated in the above table.
DISTRIBUTION AND SHAREHOLDER SERVICING FEES
The Funds have adopted a Shareholder Servicing and Distribution Plan ("the
Plan") pursuant to Rule 12b-1 under the 1940 Act with respect to each Fund
except the GE Money Market Fund. Each Fund pays GE Investment Distributors, Inc.
("GEID"), a wholly-owned subsidiary of GE Financial Assurance Holdings, Inc. (an
indirect wholly-owned subsidiary of General Electric Company) and the
82
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
Funds' principal underwriter, a monthly fee for distribution and/or shareholder
services provided, at an annual rate of the average daily net assets
attributable to each applicable class of shares. The annual rates applicable
are: .50% for Class A shares; 1.00% for Class B shares (except GE Short-Term
Government Fund which is .85%); and .25% for Class C shares. Currently Class D
shares are not subject to a 12b-1 fee plan.
GEID has agreed that once Class B shares automatically convert to Class A
shares, six years after the date of purchase (eight years in the case of shares
acquired or exchanged from shares of Investors Trust Funds), such shareholders
will be subject to the .50% distribution and/or shareholder services fees
attributable to Class A shares.
TRUSTEES COMPENSATION
The Funds pay no compensation to their Trustees who are officers or employees of
GEIM. Trustees who are not such officers or employees receive an annual fee of
$10,000 and an additional fee of $500 per Trustees' meeting attended in person.
OTHER
For the period ended September 30, 1998, the Trust was informed that GEID acting
as underwriter received net commissions of $38,166 from the sale of Class A
shares and $784,422 in contingent deferred sales charges from redemptions of
Class A and Class B shares.
4. SUB-ADVISORY AGREEMENT
Pursuant to an investment sub-advisory agreement with GEIM, effective September
27, 1997, Brown Brothers Harriman & Co. ("Brown Brothers") is the investment
sub-adviser to the GE Tax-Exempt Fund. Brown Brothers is responsible for the
day-to-day portfolio management of the Tax-Exempt Fund's assets, including the
responsibility for making decisions and placing orders to buy, sell or hold a
particular security, under the general supervision of GEIM and the Board. For
its services GEIM pays Brown Brothers a monthly sub-advisory fee which is
calculated as a percentage of the average daily net assets of the Fund at the
following annual rate: .20% of the first $25 million; .175% of the next $25
million; .15% of the next $50 million; and .125% of amounts in excess of $100
million.
5. AGGREGATE UNREALIZED
APPRECIATION AND DEPRECIATION
Aggregate gross unrealized appreciation/(depreciation) of investments for each
Fund at September 30, 1998, were as follows:
NET
GROSS GROSS UNREALIZED
UNREALIZED UNREALIZED APPRECIATION/
APPRECIATION DEPRECIATION (DEPRECIATION)
- --------------------------------------------------------------------------------
GE International
Equity Fund $ 3,231,599 $ 6,327,354 $ (3,095,755)
GE Global Equity
Fund 5,478,636 5,916,463 (437,827)
GE Premier Growth
Equity Fund 4,816,330 1,611,173 3,205,157
GE U.S. Equity
Fund 88,909,406 22,414,986 66,494,420
GE Mid-Cap
Growth Fund 3,588,625 7,373,723 (3,785,098)
GE Value Equity
Fund 7,874,741 4,358,194 3,516,547
GE Strategic
Investment Fund 20,741,218 4,936,169 15,805,049
GE Tax-Exempt
Fund 1,453,576 11,964 1,441,612
GE Fixed Income
Fund 3,492,370 576,247 2,916,123
GE Government
Securities Fund 27,117,918 5,979,675 21,138,243
GE Short-Term
Government Fund 432,004 17,549 414,455
The aggregate cost of each Fund's investments was substantially the same for
book and federal income tax purposes at September 30, 1998.
83
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
6. OPTIONS
During the period ended September 30, 1998, the following option contracts were
written:
GE FIXED GE STRATEGIC
INCOME FUND INVESTMENT FUND
- --------------------------------------------------------------------------------
NUMBER NUMBER
OF CONTRACTS PREMIUM OF CONTRACTS PREMIUM
- --------------------------------------------------------------------------------
Balance as of
September 30, 1997 1,216 $ 5,267 403 $ 1,817
Written 28,810 104,776 14,820 53,607
Closed and Expired (20,581) (71,542) (10,708) (36,936)
Exercised (3,075) (13,089) (1,575) (6,717)
- --------------------------------------------------------------------------------
Balance as of
September 30, 1998 6,370 $ 25,412 2,940 $ 11,771
- --------------------------------------------------------------------------------
GE GOVERNMENT GE VALUE
SECURITIES FUND EQUITY FUND
- --------------------------------------------------------------------------------
NUMBER NUMBER
OF CONTRACTS PREMIUM OF CONTRACTS PREMIUM
- --------------------------------------------------------------------------------
Balance as of
September 30, 1997 0 $ 0 0 $ 0
Written 113,385 381,973 200 481
Closed and
Expired (82,445) (256,803) (200) (481)
Exercised (16,040) (71,186) 0 0
- --------------------------------------------------------------------------------
Balance as of
September 30, 1998 14,900 $ 53,984 0 $ 0
- --------------------------------------------------------------------------------
GE U.S.
EQUITY FUND
- --------------------------------------------------------------------------------
NUMBER
OF CONTRACTS PREMIUM
- --------------------------------------------------------------------------------
Balance as of
September 30, 1997 0 $ 0
Written 7 1,698
Closed and
Expired (7) (1,698)
Exercised 0 0
- --------------------------------------------------------------------------------
Balance as of
September 30, 1998 0 $ 0
- --------------------------------------------------------------------------------
7. INVESTMENT TRANSACTIONS
The cost of purchases and the proceeds from sales of investments, other than
U.S. Government securities, short-term securities and options, for the period
ended September 30, 1998, were as follows:
PURCHASES SALES
- --------------------------------------------------------------------------------
GE International
Equity Fund $55,325,094 $108,916,284
GE Global Equity Fund 36,994,979 47,710,192
GE Premier Growth
Equity Fund 19,751,474 7,657,508
GE U.S. Equity Fund 240,387,493 128,044,231
GE Mid-Cap Growth Fund 4,905,238 7,097,555
GE Value Equity Fund 27,558,894 23,367,128
GE Strategic
Investment Fund 72,028,125 60,967,321
GE Tax-Exempt Fund 19,138,606 31,013,035
GE Fixed Income Fund 30,659,559 18,692,543
GE Government
Securities Fund 4,305,844 2,460,525
GE Short-Term
Government Fund 6,539,639 5,048,971
The cost of purchases and the proceeds from sales of long-term U.S. Government
securities for the period ended September 30, 1998, were as follows:
PURCHASES SALES
- --------------------------------------------------------------------------------
GE U.S. Equity Fund $ 2,974,621 $ 1,082,986
GE Strategic
Investment Fund 106,576,182 93,815,345
GE Fixed Income Fund 209,466,027 177,575,239
GE Government
Securities Fund 291,987,981 414,785,176
GE Short-Term
Government Fund 44,916,561 38,390,780
84
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998
- --------------------------------------------------------------------------------
8. BENEFICIAL INTEREST
The number of shareholders each owning 5% or more of a Fund and the total
percentage of the Fund held by such shareholders at September 30, 1998 are:
5% OR GREATER SHAREHOLDERS
- --------------------------------------------------------------------------------
NUMBER % OF FUND HELD
- --------------------------------------------------------------------------------
GE International Equity Fund 3 42%
GE Global Equity Fund 2 29%
GE Premier Growth Equity Fund 2 28%
GE U.S. Equity Fund 3 27%
GE Mid-Cap Growth Fund 1 15%
GE Value Equity Fund 2 12%
GE Strategic Investment Fund 4 32%
GE Tax-Exempt Fund 1 17%
GE Fixed Income Fund 3 22%
GE Short-Term Government Fund 4 56%
GE Money Market Fund 2 19%
At September 30, 1998, Employers Reinsurance Corporation, an indirect
wholly-owned subsidiary of General Electric Company, owned 17% of the shares
outstanding of the GE Tax-Exempt Fund; GE Capital Assurance Company, an indirect
wholly-owned subsidiary of General Electric Company, owned 7% and 19%,
respectively, of the shares outstanding of the GE Premier Growth Equity and GE
Short-Term Government Funds; GNA Corporation, a direct subsidiary of General
Electric Capital Corporation, owned 13%, 7%, and 5%, respectively, of the shares
outstanding of the GE Mid-Cap Growth, GE Value Equity and GE Short-Term
Government Funds; and GE Moderate Strategy Fund, an open-end management
investment company operating as a "fund of funds," being advised by GEIM, owned
15%, 7%, 7% and 5%, respectively, of the outstanding shares of the GE
International Equity Fund, GE Fixed Income Fund, GE Premier Growth Fund and GE
Value Equity Fund. GE Conservative Strategy and GE Aggresive Strategy Funds
owned less than 3% of shares outstanding of certain GE Funds.
9. CAPITAL STOCK
On October 29, 1998, the Trustees declared a reverse stock split, with an
effective date of November 6, 1998 in the ratios of 1 share for 4.71 shares of
the GE Mid-Cap Growth Fund and 1 share for 1.68 shares for the GE Value Equity
Fund. All capital share activity and per share data for these funds have been
restated to reflect the reverse stock splits.
85
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and Trustees of GE Funds
In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of each of the funds constituting GE
Funds (the "Trust") at September 30, 1998, and the results of their operations,
the changes in their net assets and the financial highlights for the periods
indicated, in conformity with generally accepted accounting principles. These
financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Trust's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of investments owned at
September 30, 1998 by correspondence with the custodian and brokers, provide a
reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
Boston, Massachusetts
November 9, 1998
86
<PAGE>
TAX INFORMATION, UNAUDITED
- --------------------------------------------------------------------------------
Of the dividends paid from net investment income by the GE Tax-Exempt Fund for
the tax period ended September 30, 1998, 99.02% represents exempt interest
dividends for Federal income tax purposes.
Please consult a tax adviser if you have any questions about federal or state
income tax laws or on how to prepare your tax returns. If you have specific
questions about your Fund account, please consult your investment representative
or call 1-800-242-0134.
87
<PAGE>
GE FUNDS INVESTMENT TEAM
- --------------------------------------------------------------------------------
PORTFOLIO MANAGERS
GE INTERNATIONAL EQUITY FUND
Team led by
Ralph R. Layman
GE GLOBAL EQUITY FUND
Ralph R. Layman
Michael J. Solecki
GE PREMIER GROWTH EQUITY FUND
David B. Carlson
GE U.S. EQUITY FUND
Team led by
Eugene K. Bolton
GE MID-CAP GROWTH FUND
Elaine G. Harris
GE VALUE EQUITY FUND
Peter J. Hathaway
GE STRATEGIC INVESTMENT FUND
David B. Carlson
Ralph R. Layman
Robert A. MacDougall
GE TAX-EXEMPT FUND
Barbara A. Brinkley-
Brown Brothers Harriman & Co.
GE FIXED INCOME FUND
GE GOVERNMENT SECURITIES FUND
GE SHORT-TERM GOVERNMENT FUND
GE MONEY MARKET FUND
Team led by
Robert A. MacDougall
INVESTMENT ADVISER
AND ADMINISTRATOR
GE Investment Management Inc.
TRUSTEES
Michael J. Cosgrove
John R. Costantino
Alan M. Lewis
William J. Lucas
Robert P. Quinn
SECRETARY
Matthew J. Simpson
TREASURER
Jeffrey A. Groh
ASSISTANT TREASURERS
Michael M. D'Ambrosio
Sandra J. O'Keefe
Michael J. Tansley
DISTRIBUTOR
GE Investment Distributors, Inc.
Member NASD and SIPC
COUNSEL
Willkie Farr & Gallagher
CUSTODIAN
State Street Bank & Trust Company
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
OFFICERS OF THE INVESTMENT ADVISER
John H. Myers, Chairman of the Board and President
Eugene K. Bolton, EVP, Domestic Equities
Michael J. Cosgrove, EVP, Mutual Funds
Ralph R. Layman, EVP, International Equities
Alan M. Lewis, EVP, General Counsel and Secretary
Robert A. MacDougall, EVP, Fixed Income
Geoffrey R. Norman, EVP, Institutional Marketing
Thomas J. Szkutak, EVP, Chief Financial Officer
Don W. Torey, EVP, Alternative Investments and Real Estate
88
<PAGE>
SHAREHOLDER INQUIRIES
- --------------------------------------------------------------------------------
CLASS A, B AND C INVESTORS: For questions regarding the Funds or your account,
call your Investment Representative or the GE Funds Inquiry Center at
1-800-242-0134.
Address inquiries regarding the Funds to: GE FUNDS
3003 SUMMER STREET
P.O. BOX 7900
STAMFORD, CT 06904-7900
Address requests regarding your account(s) to: GE FUNDS
P.O. BOX 419631
KANSAS CITY, MO 64141-6631
Overnight express mail Address: GE FUNDS
C/O NFDS
330 WEST 9TH STREET
KANSAS CITY, MO 64105
CLASS D INVESTORS: Contact your designated GE Investments account
representative
401(k) PLAN INVESTORS: Call your company's designated plan number.
At GE, we're dedicated to providing the investment options you'll need to tailor
your financial portfolio to every stage of your life. Each member of the GE
Family of Funds is managed according to the same principles of integrity and
quality that have guided GE over the past century, and have made it the
world-class company that it is today. Each fund draws strength from a tradition
of investment management that spans more than 75 years. Whether you're creating
a new investment portfolio or adding to an established one, the GE Family of
Funds offers an array of professionally managed investment options that will
help you meet a lifetime of financial needs.
The GE Family of Funds is just one of the investment product lines available
through GE Financial Assurance -- a dynamic family of investment and insurance
companies devoted to providing financial solutions to consumers seeking to
accumulate, preserve and protect wealth over their lifetimes.
<PAGE>
Bulk Rate
U.S. Postage
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Canton, MA
Permit No. 313
Investment Adviser
GE Investment Management Incorporated
3003 Summer Street
Stamford, CT 06905
Distributor
GE Investment Distributors Inc.
Member NASD and SIPC
777 Long Ridge Road, Building B
Stamford, CT 06927
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